Document:

saic-ex101_7.htm

 

Exhibit 10.1

AGREEMENT AND GENERAL RELEASE

THIS AGREEMENT and GENERAL RELEASE (the “Agreement”), made and effective for all purposes and in all respects as of January 19, 2017, by and between Science Applications International Corporation, (“EMPLOYER”) and Kimberly Admire (“EMPLOYEE”), (collectively, “the parties.”)

WHEREAS, EMPLOYER AND EMPLOYEE have agreed that EMPLOYEE’s employment with EMPLOYER will terminate on April 14, 2017;

WHEREAS, from February 4, 2017, through and including April 14, 2017, EMPLOYEE will be on a paid leave, but will be available for any and all projects assigned by EMPLOYER;

WHEREAS, the parties desire that EMPLOYEE’S employment end with an Agreement;

WHEREAS, EMPLOYER has agreed to provide certain consideration to EMPLOYEE, as specified below, in return for this Agreement;

WHEREAS, EMPLOYEE has made commitments and promises of acknowledged value to EMPLOYER; and,

WHEREAS, each party to this Agreement has made the decision and determination that it or she has sufficient information necessary to enter into and execute this Agreement.

NOW, THEREFORE, in consideration of the agreements, covenants, releases, and obligations contained herein and other valuable consideration, including the continuing employment of EMPLOYEE from February 4, 2017 through April 14, 2017, and Severance Payments, the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending legally to be bound, hereby agree as follows:

1. Termination of Employment

	
 
	
A.
	
EMPLOYER and EMPLOYEE agree that, effective April 14, 2017, EMPLOYEE’s employment with EMPLOYER will terminate.  The parties further agree that from February 4, 2017 through and including April 14, 2017, EMPLOYEE shall be on paid leave status, for all time during which EMPLOYEE is not engaged in the performance of services for or on behalf of EMPLOYER, in accordance with paragraph 3 herein.  This period of paid leave, from February 4, 2017 through April 14, 2017, shall hereinafter be referred to as “Consulting Leave” or the “Consulting Leave Period.” During the Consulting Leave Period, EMPLOYEE shall be permitted to volunteer her time and service to one or more charities or other not-for-profit organizations.

	
 
	
B.
	
Except in the event of termination for “cause,” and provided EMPLOYEE executes the Second Release, the form of which is attached hereto as Appendix A, if EMPLOYER terminates EMPLOYEE’s employment prior to April 14, 2017, EMPLOYER agrees to pay to EMPLOYEE, within ten (10) business days of such termination an amount sufficient to provide EMPLOYEE with: (1) all compensation and benefits (including without limitation the weekly salary and benefits for the Consulting Leave Period, as set forth in paragraph 3; (2) the severance payments set forth in paragraph 4 herein, under the same terms and conditions specified in paragraph 4, as if EMPLOYEE’s employment had continued through April 14, 2017; and, (3) the cash equivalent of any and all amounts EMPLOYEE would have earned from the vesting of restricted stock units and stock options in which EMPLOYEE would have vested had her employment not been terminated before April 14, 2017, as set forth in paragraph 4 herein, subject to the same terms and conditions as provided in paragraph 4.  In the event EMPLOYER terminates EMPLOYEE’s employment for “cause,” EMPLOYEE shall not be entitled to any severance payments pursuant to this Agreement and shall only be entitled to those wages, including Comprehensive Leave and 

- 1 -

 

 

	
 
		
benefits that EMPLOYEE has earned and accrued prior to termination.  For purposes of this Agreement, “cause” means employment-related dishonesty, fraud, violation of the SAIC Code of Conduct, misconduct, disclosure or misuse of confidential information, or other employment related conduct that is likely to cause significant injury to EMPLOYER, its affiliates or subsidiaries, or any of its or their respective employees, officers or directors (including, without limitation, commission of a felony or similar offense), in each case as determined by a court of law or arbitrator. “Cause” shall not require that a civil judgment or criminal conviction has been entered against EMPLOYEE, or a guilty plea shall have been made by EMPLOYEE, regarding any of the matters referred to in the previous sentence.  If EMPLOYEE is criminally charged with a felony or similar offense, that shall be a sufficient, but not a necessary, basis for such belief.

 2. Officer Status

The parties agree that effective February 4, 2017, EMPLOYEE will no longer serve as a Section 16 officer or an officer of EMPLOYER or any of its affiliates or subsidiaries.

3. Consulting Leave Compensation

	
 
	
A.
	
Subject to EMPLOYEE signing this Agreement, during her Consulting Leave, EMPLOYER will continue to pay to EMPLOYEE the gross weekly salary EMPLOYEE currently earns (Seven Thousand Two Hundred and Twenty Two Dollars and Twelve Cents ($7,222.12)) (the “Weekly Salary”). EMPLOYEE will also continue to be eligible for benefits under the same terms and conditions as in effect on the date of execution of this Agreement. Notwithstanding anything to the contrary, EMPLOYER’s benefits may change in the future, and EMPLOYEE will be eligible to participate in applicable future benefits, as may be provided by EMPLOYER to similarly situated employees.  The Weekly Salary and any benefits to which EMPLOYEE is entitled under this Agreement shall be paid on a W-2 basis and shall be subject to all required withholdings and statutory deductions.

	
 
	
B.
	
The parties agree that during her Consulting Leave, EMPLOYEE shall continue to earn and accrue Comprehensive Leave in accordance with EMPLOYER’s Comprehensive Leave policy. EMPLOYEE will be compensated by EMPLOYER for all earned and accrued Comprehensive Leave that remains unused on April 14, 2017, in a lump sum payment.

4. Severance Payments  Following the execution by EMPLOYEE of the Second Release in the form of the release attached hereto in Appendix A on termination of her employment with EMPLOYER on April 14, 2017, EMPLOYER agrees to:

	
 
	
A.
	
Pay to EMPLOYEE within ten (10) business days, in a lump sum, a severance payment of Seven Hundred Sixty Thousand, One Hundred Eighty Three Dollars ($760,183), which is composed of the amounts set forth in Appendix B, attached hereto and incorporated herein by reference.

	
 
	
B.
	
EMPLOYER also agrees to provide EMPLOYEE with twelve (12) months of executive outplacement services, up to a maximum amount of Twenty Five Thousand Dollars ($25,000). Employee may begin using those services on a mutually agreeable date once this Agreement has been executed, and may continue to do so for up to twelve (12) consecutive months once the service provider has been engaged.

	
 
	
C.
	
Solely as a result of EMPLOYER’s agreement to allow EMPLOYEE to continue to be employed through April 14, 2017, as set forth in this Agreement, and unless terminated earlier for cause, EMPLOYEE will vest in certain equity grants.  These additional vesting opportunities provide EMPLOYEE with additional compensation (rounded to the nearest whole share) as follows:

	
 
	
i.
	
Vesting on April 10, 2017, of Three Thousand Two Hundred Seventy Five (3,275) stock options, granted on April 10, 2015;

- 2 -

 

 

	
 
	
ii.
	
Vesting on April 1, 2017, of Three Thousand Eight Hundred Fifty Two (3,852) stock options, granted on April 1, 2016;

	
 
	
iii.
	
Vesting on April 10, 2017, of Five Hundred Fifty Five (555) restricted stock units, granted on April 10, 2015;

	
 
	
iv.
	
Vesting on April 1, 2017 of Five Hundred Fifty (550) restricted stock units, granted on April 1, 2016.

 

	
 
	
D.
	
EMPLOYEE understands that pursuant to EMPLOYER’s Amended and Restated 2013 Equity Incentive Plan, any and all vested options must be exercised within 90 days of termination of employment.  Furthermore, it is understood and agreed by the parties that in the event the terms and conditions of EMPLOYER’s Amended and Restated 2013 Equity Incentive Plan differ from or conflict with the terms and conditions of this Agreement, the terms and conditions of EMPLOYER’s Amended and Restated 2013 Equity Incentive Plan shall control.

5. Non-Competition  Without the prior written consent of EMPLOYER, which consent must be signed by EMPLOYER’S Chief Executive Officer, while EMPLOYEE remains employed by EMPLOYER and for a period of one (1) year commencing on the termination of EMPLOYEE’S employment with EMPLOYER, EMPLOYEE shall not take any employment, or serve as a director, officer, consultant, advisor, agent, or in any other capacity whatsoever, directly or indirectly, with (i) Booz Allen Hamilton; CACI International, Inc.; CSRA Inc.; Engility Holdings, Inc.; Leidos, Inc.; ManTech International Corporation; Vencore, Inc.; and, Vectrus, Inc.

EMPLOYEE acknowledges and agrees that, in view of her responsibilities while employed by EMPLOYER, including participation in the development of and having access to the business plans and growth strategy of EMPLOYER, employment by an entity referenced above would result in the inevitable disclosure or use of sensitive EMPLOYER information and, in view of these circumstances, the term and scope of this restrictive covenant is reasonable. EMPLOYEE further acknowledges and agrees that a violation of this restrictive covenant would cause irreparable damage to EMPLOYER and that in the event of a breach or threatened breach by EMPLOYEE, EMPLOYER would be entitled to injunctive relief, without the posting of any bond, in addition to such other relief as may be available at law or in equity.

6. Release  EMPLOYEE agrees and acknowledges that she is entitled to no other severance payments or severance benefits and that no severance payments described in paragraph 4 herein will be made unless and until EMPLOYEE has fulfilled all of her obligations under this Agreement, including signing the Release contained herein and, upon the termination of her employment on April 14, 2017, signing the Second Release, attached hereto as Appendix A. Nothing herein can or is intended to affect EMPLOYEE’s pension rights or other retirement benefits or the amount (if any) of any pension payments or other retirement benefits to which she is entitled, or rights to indemnification pursuant to EMPLOYER’s or any of its affiliates’ organizational documents and/or director and officer liability policies covering her activities in connection with her employment with EMPLOYER.

Except as otherwise provided in this Agreement, and except for causes of action arising under or in connection with this Agreement, EMPLOYEE hereby absolutely, unconditionally, and forever releases, acquits, and discharges EMPLOYER and EMPLOYER’s representatives, officers, directors, employees, and agents, from any and all actions, causes of action, suits, debts, costs, expenses, damages, losses, claims, liabilities, and demands of any character, nature or kind, whether known or unknown, matured or contingent, liquidated or unliquidated, in law, equity, or otherwise, which any party ever had, now has or can, shall or may have arising from or relating to EMPLOYEE’s employment by EMPLOYER and/or the cessation of that employment.  This Agreement and General Release expressly extends to all claims based on the present and future effects of past acts of EMPLOYER. The general release in this paragraph is intended specifically to include, but is not limited to, all claims or causes of action which any party could, might or may assert arising under any federal, state, or local statute or ordinance providing any remedy, including, but not limited to, claims or causes of action arising under Title VII of the Civil Rights Act of 1964, as amended, the Age 

- 3 -

 

 

Discrimination in Employment Act, as amended, and the Older Workers Benefit Protection Act of 1990, from the beginning of time to the date of execution of this Release.

7. Covenants, Representations and Warranties to Continue  The agreements, covenants, representations, and warranties of the parties set forth in this Agreement shall survive the date of the Agreement and the performance by the parties of any and all obligations under it. All such agreements and covenants shall be binding and enforceable against the parties bound thereby in accordance with their terms.

Notwithstanding anything contained in this Agreement to the contrary, nothing herein, expressed or implied, is intended to confer on any person or entity other than the parties hereto or their respective officers, directors, representatives, employees, agents, successors, heirs, executors, estates, and personal and legal representatives, any rights, remedies, obligations, or liabilities under, or by reason of, this Agreement.

8. Authority to Contract  Each party represents that it or she understands all the terms of this Agreement that it or she is duly authorized and permitted to enter into this Agreement on behalf of itself or herself, and that it or she enters into this Agreement voluntarily.

9. Entire Agreement  This Agreement constitutes the final written expression of all of the agreements between the parties with respect to the subject matter hereof and is a complete and exclusive statement of those terms. EMPLOYEE agrees that no representations, promises or agreements of any kind, other than the express written terms of this Agreement, have been made to her or on her behalf by any person or entity to cause her to sign this Agreement.

10. Non-Admission  This Agreement is made by the parties to avoid the threat of future litigation and shall never, at any time, for any purpose, be considered as an admission of liability, fault, or responsibility on the part of any party or representative thereof.  Specifically, it is understood and agreed that the payments and any other consideration referred to herein shall not be deemed to be an admission of liability by EMPLOYER.

11. Proprietary Information 

	
 
	
A.
	
EMPLOYEE understands that EMPLOYER possesses confidential, sensitive and proprietary, non-public information (collectively, “Proprietary Information” as defined below) which is important to its business.  For purposes of this Agreement, “Proprietary Information” includes, but is not limited to, information about or from or related to any clients of EMPLOYER or its subsidiary(ies) or affiliate(s); information that was or will be developed, created, or discovered by or on behalf of EMPLOYER or is developed, created or discovered by EMPLOYEE while performing services; or which became or will become known by, or was or is conveyed to EMPLOYER which has commercial value in EMPLOYER’s business.  “Proprietary Information” includes, but is not limited to, trade secrets, designs, technology, know-how, works of authorship, source and object code, algorithms, processes, data, computer programs, ideas, techniques, inventions (whether patentable or not), business and product development plans, clients’ customers, customer lists and other information concerning EMPLOYER’s actual or anticipated business, research or development, personnel information, terms of compensation and performance levels of EMPLOYER’s employees, information related to EMPLOYER’s products, processes, practices, programs, strategies, suppliers, pricing, information which EMPLOYEE has received in confidence by or for EMPLOYER from any other person. “Proprietary Information” does not include information that was within EMPLOYEE’s possession or knowledge prior to it being provided or disclosed to EMPLOYEE by EMPLOYER or that is required to be disclosed in a judicial or administrative proceeding or is otherwise requested or required by law or regulation or legal authority.

	
 
	
B.
	
At all times, both during the term of this Agreement and after its termination, EMPLOYEE agrees to keep confidential and in trust, and will not use or disclose, any Proprietary 

- 4 -

 

 

	
 
		
Information without the prior written consent of an officer of EMPLOYER, except as may be necessary in the ordinary course of performing the services under this Agreement.  At the termination of the Agreement, EMPLOYEE shall return to EMPLOYER all information, materials, documents, manuals, and all other printed or reproduced materials, regardless of the format, including, but not limited to, computer discs and programs, hard drives, flash drives, materials stored on a cloud or server, cell or smart phones, tablets or any other electronic device provided by EMPLOYER to EMPLOYEE, or which the EMPLOYEE uses in her employment with EMPLOYER, and all copies of such materials made by or for the benefit of EMPLOYEE.

12. Return of EMPLOYER Property  EMPLOYEE agrees to return to EMPLOYER all property provided to her by EMPLOYER, including but not limited to all computers, electronic devices, tablets, cell or smart phones, equipment, computer hardware, software and accessories, credit cards, company badge and keys.

13. Federal Law Protections 

	
 
	
A.
	
Notwithstanding anything contained in this Agreement to the contrary, to the extent protected by the whistleblower provisions of federal law or regulation, nothing in this Agreement prohibits EMPLOYEE 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.  EMPLOYEE does not need the prior authorization of EMPLOYER to make any such reports or disclosures, and EMPLOYEE is not required to notify EMPLOYER that she has made such reports or disclosures. Furthermore, this Agreement is not intended to interfere with EMPLOYEE’s exercise of any protected, non-waivable right, such as those identified herein, including, specifically, EMPLOYEE’s right to file a charge with the Equal Employment Opportunity Commission or other government agency.

	
 
	
B.
	
By entering into this Agreement, however, EMPLOYEE acknowledges that the consideration set forth herein is in full satisfaction and is inclusive of any and all amounts, including but not limited to attorneys’ fees, to which EMPLOYEE might be entitled or which may be claimed by EMPLOYEE or on EMPLOYEE’s behalf against EMPLOYER, except with respect to those claims protected by the whistleblower provisions of federal law or regulation.  With respect to all other claims, EMPLOYEE forever discharges the EMPLOYER from any liability to EMPLOYEE for any acts or omissions occurring on or before the date of EMPLOYEE’s signing of this Agreement.

14. Breach of Agreement  If EMPLOYEE breaches her promise and files or participates in a legal proceeding based on any such released claims, except with respect to those claims protected by the whistleblower provisions of federal law or regulation, EMPLOYER’s obligation to make the payments and benefits referred to herein shall terminate immediately, and the EMPLOYEE shall (i)  repay to EMPLOYER any money paid to her pursuant to this Agreement; (ii) pay for all costs incurred by EMPLOYER, including reasonable attorneys’ fees, in defending against EMPLOYEE’s claim; and (iii) pay all other damages awarded by a court of competent jurisdiction or arbitral tribunal.

15. Non-Disparagement  EMPLOYEE agrees that she will not disparage, debase, or demean EMPLOYER and EMPLOYER’s representatives, officers, directors, employees, and agents.  If the EMPLOYEE breaches the terms of this paragraph, EMPLOYER’s obligation to make the payments and benefits set forth herein shall terminate immediately, and the EMPLOYEE will (i) repay to EMPLOYER any money paid to her pursuant to this Agreement; (ii) pay for all costs incurred by EMPLOYER, including reasonable attorneys’ fees, in defending against EMPLOYEE’s claim; and (iii) pay all other damages awarded by a court of competent jurisdiction or arbitral tribunal.  EMPLOYER agrees that it will not disparage, debase or demean EMPLOYEE and will use reasonable efforts to ensure that its officers, directors, executives and employees do not disparage, debase or demean EMPLOYEE.  If EMPLOYER breaches the term of this paragraph, the EMPLOYER will pay for all costs incurred by EMPLOYEE, 

- 5 -

 

 

including reasonable attorneys’ fees, in bringing a cause of action against EMPLOYER, and pay all other damages awarded by a court of competent jurisdiction or arbitral tribunal.

16. Non-Solicitation  Following her termination of employment on April 14, 2017, and for one (1) year thereafter, EMPLOYEE agrees that she will not directly or indirectly recruit, solicit, or hire any employee of EMPLOYER, or induce or attempt to induce any employee of EMPLOYER to terminate his/her employment with, or otherwise cease his/her relationship with, EMPLOYER. EMPLOYEE also agrees that for the same one (1) year period, EMPLOYEE will not directly solicit the business of any of the customers of EMPLOYER with whom EMPLOYEE worked directly or who were introduced by EMPLOYER.

17. Continued Availability and Cooperation  EMPLOYEE shall reasonably cooperate with EMPLOYER and with EMPLOYER’s counsel in connection with any present and future actual or threatened litigation or administrative proceeding involving EMPLOYER that relates to events, occurrences or conduct occurring (or claimed to have occurred) during the period of EMPLOYEE’s employment by EMPLOYER.  EMPLOYER agrees to pay all reasonable expenses incurred by EMPLOYEE in cooperating.  This cooperation by EMPLOYEE shall include, but not be limited to:

	
 
	
A.
	
Making herself reasonably available for interviews and discussions with EMPLOYER’s counsel for depositions and trial testimony; and,

	
 
	
B.
	
If depositions or trial testimony are to occur, making herself reasonably available and cooperating in the preparation therefor as and to the extent that EMPLOYER or the EMPLOYER’s counsel reasonably requests.

18. Amendment. This Agreement may be amended or modified only by a written instrument executed by both EMPLOYEE and EMPLOYER.

19. Provisions to Survive Agreement  The parties agree that the provisions of paragraphs 4, 5, 6, 7, 9, 10, 11, 12 and 16 shall survive the Agreement.

20. Governing Law This Agreement shall be construed, interpreted and enforced in accordance with the laws of the Commonwealth of Virginia.

21. Arbitration  Any disputes arising under or relating to this Agreement shall be subject to arbitration pursuant to the American Arbitration Association’s Employment Arbitration Rules and Mediation Procedures, as in effect when the dispute arose.  The situs of any arbitration between the parties shall be Virginia, and the arbitrators shall have the authority to decide the issue of arbitrability.  Any such arbitration will be conducted in the Commonwealth of Virginia and will be decided in accordance with and determined by the laws of the Commonwealth of Virginia, without regard to conflicts of laws or choice of laws.

22. Successors and Assigns  This Agreement shall be binding upon, and inure to the benefit of, both parties.  The parties agree that the EMPLOYEE may not assign this Agreement, her obligations to perform services, or her right to receive any sums due thereunder without the prior written consent of the EMPLOYER, including the EMPLOYER’S successors and assigns, including any corporation or entity with which, or into which, the EMPLOYER may be merged or which may succeed to its assets or business.

23. Captions and Paragraph Headings  Captions and paragraph headings used herein are for convenience and are not part of this Agreement and shall not be used in construing it.

24. Further Assurances  Each party hereto shall execute such additional documents, and do such additional things, as may reasonably be requested by the other party to effectuate the purposes and provisions of this Agreement.

25. Miscellaneous 

	
 
	
A.
	
No delay or omission by the either party in exercising any right under this Agreement shall operate as a waiver of that or any other right. A waiver or consent given by a party on any 

- 6 -

 

 

	
 
		
one occasion shall be effective only in that instance and shall not be construed as a bar or waiver by that party of any right on any other occasion.

	
 
	
B.
	
In the event that any provision of this Agreement shall be invalid, illegal or otherwise unenforceable, the validity, legality and enforceability of the remaining provisions shall in no way be affected or impaired thereby.

26. Acknowledgement  EMPLOYEE acknowledges that:

	
 
	
A.
	
She has been advised to consult an attorney prior to signing this Agreement;

	
 
	
B.
	
With respect only to claims or causes of action or potential claims or causes of action subject to the Age Discrimination in Employment Act, as amended (the “ADEA”), she has twenty-one (21) days after the date of this Agreement is provided to her to sign and deliver the signed copy of the Agreement to EMPLOYER (although she may choose to sign and deliver the Agreement sooner);

	
 
	
C.
	
With respect only to claims or causes of action or potential claims or causes of action subject to the ADEA, she has a period of seven (7) days after a signed copy of this Agreement is delivered to EMPLOYER to cancel and revoke it;

	
 
	
D.
	
With respect to all claims or causes of action or potential claims or causes of action other than those under the ADEA, this Agreement is effective and binding upon signature of all parties;

	
 
	
E.
	
She has read and fully understands all of the provisions of this Agreement, and she is knowingly and voluntarily agreeing to its terms;

	
 
	
F.
	
Should she rescind her acceptance of this Agreement as provided in sub-paragraph (C) above, with respect to claims pursuant to the ADEA, EMPLOYER has no obligation to pay any part of the amounts described herein.

- 7 -

 

 

IN WITNESS WHEREOF, EMPLOYER and EMPLOYEE, intending to be legally bound, have executed this Agreement as of the last date stated below.

Dated this 19th day of January, 2017.

 

	
WITNESS:
	
 
	
Science Applications International Corporation

	
/s/  Steven G. Mahon
	
 
	
/s/  Anthony J. Moraco

	
 
	
 
	
By:
	
Anthony J. Moraco

	
 
	
 
	
Title:
	
Chief Executive Officer

 

- 8 -

 

 

With respect to claims or causes of action or potential claims or causes of actions pursuant to the Age Discrimination in Employment Act, as amended, I understand that I have twenty-one (21) days to consider the offer made to me in this Agreement. My signature below affirms that I have knowingly and voluntarily elected to shorten that period.

Dated this 10th day of January, 2017.

 

	
WITNESS:
	
  
	
    
	
 

	
/s/   Vernon Wilkins
	
  
	
    
	
/s/   Kimberly Admire

	
Vernon Wilkins
	
  
	
    
	
Kimberly Admire

 

 

- 9 -

 

 

APPENDIX A

 

SECOND RELEASE

 

FOR GOOD AND VALUABLE CONSIDERATION received by Kimberly Admire (“EMPLOYEE”) from Science Applications International Corporation, (“EMPLOYER”), the receipt of which is hereby acknowledged, and in accordance with the AGREEMENT AND GENERAL RELEASE entered into between the parties on or about January 19, 2017 (the “Agreement”), which Agreement is incorporated herein by reference and made a part hereof, and except in each case for causes of action arising under or in connection with the foregoing Agreement and this Second Release, EMPLOYEE hereby absolutely, unconditionally, and forever releases, acquits, and discharges EMPLOYER and EMPLOYER’s representatives, officers, directors, employees, and agents, from any and all actions, causes of action, suits, debts, costs, expenses, damages, losses, claims, liabilities, and demands of any character, nature or kind, whether known or unknown, matured or contingent, liquidated or unliquidated, in law, equity, or otherwise, which any party ever had, now has or can, shall or may have arising from or relating to EMPLOYEE’s employment by EMPLOYER and/or the cessation of that employment.  This release expressly extends to all claims based on the present and future effects of past acts of EMPLOYER.  The general release in this paragraph is intended specifically to include, but is not limited to, all claims or causes of action which any party could, might or may assert, or which any personal representative, successor, heir or assign of EMPLOYEE hereafter can, shall or may have, against EMPLOYER arising under any federal, state, or local statute or ordinance providing any remedy, including, but not limited to, claims or causes of action arising under Title VII of the Civil Rights Act of 1964, as amended, the Age Discrimination in Employment Act, as amended, and the Older Workers Benefit Protection Act of 1990, from the beginning of time to the date of execution of this Release.  Nothing herein can or is intended to affect EMPLOYEE’s pension rights or other retirement benefits or the amount (if any) of any pension payments or other retirement benefits to which she is entitled, or rights to indemnification pursuant to EMPLOYER’s or any of its affiliates’ organizational documents and/or director and officer liability policies covering her activities in connection with her employment with EMPLOYER.

 

 

EMPLOYEE acknowledges that:

 

	
 
	
A.
	
She has been advised to consult an attorney prior to signing this Agreement;

	
 
	
B.
	
With respect only to claims or causes of action or potential claims or causes of action subject to the Age Discrimination in Employment Act, as amended (the “ADEA”), she has twenty-one (21) days after the date of this Agreement is provided to her to sign and deliver the signed copy of the Agreement to EMPLOYER (although she may choose to sign and deliver the Agreement sooner);

	
 
	
C.
	
With respect only to claims or causes of action or potential claims or causes of action subject to the ADEA, she has a period of seven (7) days after a signed copy of this Agreement is delivered to EMPLOYER to cancel and revoke it;

	
 
	
D.
	
With respect to all claims or causes of action or potential claims or causes of action other than those under the ADEA, this Agreement is effective and binding upon both parties;

	
 
	
E.
	
She has read and fully understands all of the provisions of this Agreement and she is knowingly and voluntarily agreeing to its terms;

	
 
	
F.
	
Should she rescind her acceptance of this Agreement as provided in sub- paragraph (C) above, with respect to claims pursuant to the ADEA, EMPLOYER has no obligation to pay any part of the amounts described herein.

IN WITNESS WHEREOF, EMPLOYEE, intending to be legally bound, has executed this Release as of the date stated below.

With respect to claims or causes of action or potential claims or causes of actions pursuant to the Age Discrimination in Employment Act, as amended, I understand that I have twenty-one (21) days to consider this Release.  My signature below affirms that I have knowingly and voluntarily elected to shorten that period.

Dated this __________ day of __________, 2017.

 

	
WITNESS:
	
  
	
    
	
 

	
 
	
  
	
    
	
 

	
 
	
  
	
    
	
Kimberly Admire

 

 

 

 

 

APPENDIX B

 

 

 

CALCULATION OF SEVERANCE

 

 

	
 
	
Current base
	
$375,550
	
 
	
 

	
 
	
 
	
      X 1.25
	
 
	
 

	
 
	
 
	
$469,438
	
 
	
 

	
 
	
 
	
 
	
 
	
 

	
 
	
STI
	
$220,596
	
 
	
(Average of 3 years)

	
 
	
 
	
      X 1.25
	
 
	
 

	
 
	
 
	
$275,745
	
 
	
 

	
 
	
 
	
 
	
 
	
 

	
 
	
Benefits1
	
$12,000
	
 
	
 

	
 
	
 
	
      X 1.25
	
 
	
 

	
 
	
 
	
$15,000
	
 
	
 

	
 
	
 
	
 
	
 
	
 

	
 
	
TOTAL
	
$760,183
	
 
	
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1 Based on estimated annual health & welfare benefits costs.Exhibit 4.1

 

 

 

THIRD SUPPLEMENTAL INDENTURE

 

between

 

MEDLEY LLC

 

and

 

U.S. BANK NATIONAL ASSOCIATION,

 

as Trustee

 

Dated as of January 18, 2017

 

 

 

THIRD SUPPLEMENTAL INDENTURE

 

THIS THIRD SUPPLEMENTAL INDENTURE (this
“Third Supplemental Indenture”), dated as of January 18, 2017, is between Medley LLC, a Delaware limited liability
company (the “Company”), and U.S. Bank National Association, as trustee (the “Trustee”). All capitalized
terms used but not otherwise defined 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 August 9, 2016 (the “Base Indenture” and, as amended and supplemented by this Third
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 $34,500,000
of the Company’s 7.25% Notes due 2024 (the “Notes”).

 

Sections 901(5) and 901(7) 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 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 Indenture applicable to the Notes
(“Future Supplemental Indenture”)).

 

The Company has duly authorized the execution
and delivery of this Third Supplemental Indenture to provide for the issuance of the Notes and amendment of certain provisions
of the Base Indenture as herein provided and all acts and things necessary to make this Third 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 101
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 “7.25% Notes due 2024.” The Notes shall bear
a CUSIP number of 58503Y 204 and an ISIN number of US58503Y2046.

 

(b) The
aggregate principal amount of the Notes that may be 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 $34,500,000.
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 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 January 30, 2024, unless earlier redeemed or repurchased in accordance with the provisions of this
Third Supplemental Indenture.

 

(d) The
rate at which the Notes shall bear interest shall be 7.25% per annum (the “Applicable Interest Rate”). The date from
which interest shall accrue on the Notes shall be January 18, 2017, or the most recent Interest Payment Date to which interest
has been paid or provided for; the Interest Payment Dates for the Notes shall be January 30, April 30, July 30 and October 30,
commencing April 30, 2017 (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 January 18, 2017, to, but excluding, the initial Interest Payment
Date, 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 January 15, April 15, July 15
or October 15 (whether or not a Business Day), as the case may be, next 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 Corporate Trust Office of the Trustee in Boston,
Massachusetts 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 Third 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, redemptions and issuances. 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 1007, 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 January 30, 2020, 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) Any exercise of the Company’s
option to redeem the Notes will be done in compliance with the Indenture to the extent applicable.

 

(iv) If the Company elects to
redeem only a portion of the Notes, the Trustee or the Depositary, as applicable, 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.

 

(v) 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 “Designated
Senior Securities” under the Indenture.

 

ARTICLE
II

DEFINITIONS
AND OTHER PROVISIONS OF GENERAL APPLICATION

 

Section 201
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
I of the Base Indenture shall be amended by adding the following defined terms to Section 101 in appropriate alphabetical sequence,
as follows:

 

“‘Exchange
Act’ means the Securities Exchange Act of 1934, as amended, and any statute successor
thereto.”

 

“‘GAAP’
means generally accepted accounting principles in the United States set forth in the opinions and pronouncements of the Accounting
Principles Board of the American Institute of Certified Public Accountants, the opinions and pronouncements of the Public Company
Accounting Oversight Board and the statements and pronouncements of the Financial Accounting Standards Board or in such other statements
by such other entity as have been approved by a significant segment of the accounting profession in the United States, which are
in effect from time to time.”

 

     

     

    

 

ARTICLE
III

COVENANTS

 

Section 301
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
X of the Base Indenture shall be amended by adding the following new Section 1007 thereto, as set forth below:

 

“Section 1007
Commission Reports and Reports to Holders.

 

If, at any time, the Company or
Medley Management Inc. are 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, 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
IV

REDEMPTION
OF SECURITIES

 

Section 401
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
1103 of the Base Indenture shall be amended by replacing the heading and the first paragraph thereof with the following:

 

“Section
1103. Selection of Securities to Be Redeemed.

 

If less than all the Securities
of any series issued on the same day with the same terms are to be redeemed, the particular Securities to be redeemed shall be
selected not more than 45 days prior to the Redemption Date by the Trustee, or by the Depositary in the case of global Securities,
from the Outstanding Securities of such series issued on such date with the same terms not previously called for redemption, in
compliance with the requirements of DTC and in compliance with the requirements of the principal national securities exchange on
which the Securities are listed (if the Securities are listed on any national securities exchange), or if the Securities are not
held through DTC or listed on any national securities exchange, or DTC prescribed no method of selection, on a pro rata basis,
or by such method as the Trustee shall deem fair and appropriate and subject to and otherwise in accordance with the procedures
of the applicable Depositary; provided that such method may provide for the selection for redemption of portions (equal to the
minimum authorized denomination for Securities of that series or any integral multiple thereof) of the principal amount of Securities
of such series of a denomination larger than the minimum authorized denomination for Securities of that series; provided, however,
that no such partial redemption shall reduce the portion of the principal amount of a Security not redeemed to less than the minimum
authorized denomination for Securities of such series.”

 

ARTICLE
V

MEETINGS
OF HOLDERS OF SECURITIES

 

Section 501
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
VI

MISCELLANEOUS

 

Section 601
This Third Supplemental Indenture and the Notes 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. This Third 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 602
In case any provision in this Third 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 603
This Third 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 Third Supplemental Indenture. The exchange
of copies of this Third Supplemental Indenture and of signature pages by facsimile, .pdf transmission, email or other electronic
means shall constitute effective execution and delivery of this Third 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 604
The Base Indenture, as supplemented and amended by this Third Supplemental Indenture,
is in all respects ratified and confirmed, and the Base Indenture and this Third Supplemental Indenture shall be read, taken and
construed as one and the same instrument with respect to the Notes. All provisions included in this Third 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 Third Supplemental Indenture, and agrees to perform
the same upon the terms and conditions of the Base Indenture, as supplemented by this Third Supplemental Indenture.

 

Section 605
The provisions of this Third Supplemental Indenture shall become effective as of the
date hereof.

 

Section 606
Notwithstanding anything else to the contrary herein, the terms and provisions of this
Third Supplemental Indenture shall apply only to the Notes and shall not apply to any other series of Securities under the Indenture
and this Third 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 Indenture, whether now or hereafter issued and Outstanding.

 

Section 607
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 Third Supplemental Indenture, the Notes or any Additional Notes, except that the Trustee represents that
it is duly authorized to execute and deliver this Third 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 WITNESS WHEREOF, the parties hereto have caused this Third
Supplemental Indenture to be duly executed as of the date first above written.

 

	 	MEDLEY LLC
	 	 
	 	By:	 /s/ Richard T. Allorto, Jr.
	 	Name: 	 Richard T. Allorto, Jr.
	 	Title:	 Chief Financial Officer
	 	 
	 	U.S. BANK NATIONAL ASSOCIATION, as Trustee
	 	 
	 	By:	 /s/ David W. Doucette
	 	Name:	 David W. Doucette
	 	Title:	Vice President

 

 

 

 

 

[Signature page to Third Supplemental
Indenture]

 

 

     

     

    

 

Exhibit A – Form of Global Note

 

This Security is a Global Note 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.

 

	 	Medley LLC	 
	 	 	 
	No. 1	 	$ 
	 	 	CUSIP No. 58503Y 204
	 	 	ISIN No. US58503Y2046

 

7.25% Notes due 2024

 

Medley LLC, a limited liability company
duly organized and existing under the laws of Delaware (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 U.S. DOLLARS (U.S.$ ) on January 30, 2024, and to pay interest thereon from January 18, 2017, or
from the most recent Interest Payment Date to which interest has been paid or duly provided for, quarterly on January 30, April
30, July 30 and October 30 in each year, commencing April 30, 2017, at the rate of 7.25% 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 January 15, April 15, July 15 or October 15 (whether or not a Business
Day), as the case may be, next 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 Corporate Trust Office
of the Trustee in Boston, Massachusetts 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:

 

	 	MEDLEY LLC
	 	 
	 	By:	 
	 	 	Name:
	 	 	Title: 

 

Attest

 

	By:	 	 
	 	Name:	 
	 	Title:	 

 

 

     

     

    

 

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

 

 

     

     

    

 

Medley LLC

7.25% Notes due 2024

 

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 August 9, 2016 (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 Third Supplemental Indenture relating to the Securities, dated as of January 18, 2017, by and
between the Company and the Trustee (herein called the “Third Supplemental Indenture”; the Third Supplemental Indenture
and the Base Indenture collectively are herein called the “Indenture”). In the event of any conflict between the Base
Indenture and the Third Supplemental Indenture, the Third 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 $34,500,000.
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,
redemptions and issuances.

 

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 January 30, 2020, 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.

 

Any exercise of the Company’s option
to redeem the Securities will be done in compliance with the Indenture and the Investment Company Act, to the extent applicable.

 

If the Company elects to redeem only a portion
of the Securities, the Trustee or the Depositary, as applicable, will determine the method for selecting the particular Securities
to be redeemed, in accordance with the Indenture to the extent applicable. 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.

 

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 50% 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 reasonable indemnity 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. 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 or Trustee 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 and any agent of the Company or the Trustee 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 neither the
Company, the Trustee nor any such agent 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.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00266-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00266-of-00352.parquet"}]]