Document:

EXHIBIT 10.5

 

Subscription Agreement No.:____________

 

Name:_____________________________

 

Date:________________

 

GYROTRON TECHNOLOGY, INC.

 

SUBSCRIPTION AGREEMENT

 

SERIES B1 PREFERRED STOCK 

 

Gyrotron Technology, Inc.

3412 Progress Drive

Bensalem, Pennsylvania 19020

 

Gentlemen:

 

1. Subscription.

 

(a) The undersigned subscriber (the “Subscriber”), intending to be legally bound, hereby irrevocably subscribes to purchase from Gyrotron Technology, Inc., a Delaware corporation (the “Company”) _______ units (the “Units”) each consisting of (i) one share of 10% Convertible Redeemable Series B1 Preferred Stock, par value $0.001 per Share (the “Series B1 Preferred Stock”), of the Company, and (ii) fifty warrants (the “Warrants”), each to acquire one share of common stock, par value $0.001 per share of the Company (each, a “Common Share”), expiring no earlier than 12/31/14 and no later than March 31, 2016 with an exercise price of $1.00 per Common Share, at a price of $35.00 per Unit, plus accrued dividends, if any; all as set forth on the signature page hereof. The form of Certificate of Designation (“COD”) for the Series B1 Preferred Stock, and the Warrant Agreement for the Warrants are attached as Exhibit B and C respectively and all references to their terms are qualified in their entirety by reference to said exhibits.

 

This subscription is made in accordance with and subject to the terms and conditions described in this Subscription Agreement (this “Agreement”) and any other documents concerning the Company that have been furnished to the Subscriber concerning the Offering (the “Other Offer Documents”).

 

The Shares that are the subject of this Agreement are part of an offering of Units by the Company (the “Offering”), on a best efforts basis. There are 80,000 shares of Series B1 Preferred Stock authorized. The number of Units that the Company may offer and/or sell is at the Company’s discretion.

 

The Company may use broker-dealers and other agents to offer and sell the Units, and/or finders identify and introduce potential subscribers to the Company. Compensation may be paid to these persons in the amount of (i) up to 6% of the gross proceeds to the Company of the Units that they have placed, to be paid in cash and/or in Units, and (ii) up to 4% of the number of Warrants purchased hereunder as part of the Units. in additional Warrants

 

	 
	
1

	

 

The Company may terminate the Offering at any time without prior notice. Also, the Company, in its sole discretion, may accept or reject this subscription for Shares and Warrants in whole or in part for any reason, but the Company will issue Shares and Warrants in respect of all subscriptions accepted prior to such termination. If the Company decides to reject this subscription, it will do so promptly following its receipt and will return the Subscriber’s funds without interest as soon as practicable.

 

The Series B1 Preferred Stock pro forma began to accrue dividends as of September 1, 2012. In lieu of requesting payment in the amount of dividends accrued through the date of delivery of the Subscriber’s subscription payment, the Company will withhold from the dividend payments otherwise payable to a Subscriber the amount of the dividends accrued through the date of delivery of the subscription payment. For the avoidance of doubt, for payments received prior to the filing of the COD, dividends accruing pro forma to the date of receipt of payment will be withheld.

 

THE SHARES AND THE WARRANTS BEING OFFERED HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION, NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY APPLICABLE STATE OR OTHER REGULATORY AUTHORITY PASSED UPON THE ACCURACY OR ADEQUACY OF THE OTHER OFFER DOCUMENTS OR ENDORSED THE MERITS OF THE OFFERING. ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL.

 

THE SHARES AND THE WARRANTS ARE OFFERED PURSUANT TO EXEMPTIONS PROVIDED BY THE SECURITIES ACT, CERTAIN STATE SECURITIES LAWS AND CERTAIN RULES AND REGULATIONS PROMULGATED PURSUANT THERETO. NEITHER THE SHARES AND THE WARRANTS NOR ANY INTEREST THEREIN MAY BE SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND COMPLIANCE WITH ANY APPLICABLE STATE OR OTHER SECURITIES LAWS OR AN EXEMPTION FROM SUCH REGISTRATION REQUIREMENT AND COMPLIANCE, THE AVAILABILITY OF WHICH MUST BE ESTABLISHED TO THE SATISFACTION OF THE COMPANY.

 

The Subscriber understands that the Shares and the Warrants are being is­sued pursuant to the exemption from the registration requirements of the Securities Act, provided by Section 4(2) of such Act, or Regulation D promulgated thereunder, or both. As such, the Shares and the Warrants are only being offered and sold to investors who qualify as “accredited investors,” and the Company is relying on the representations made by the Subscriber in this Agreement that the Subscriber qualifies as such an ac­credited investor. The Shares and the Warrants are “restricted securities” for purposes of the United States securities laws and cannot be transferred except as permitted under these laws.

 

(b) The Subscriber is delivering (i) two executed copies of the signature page of this Agreement (including Exhibit A), and (ii) the subscription pay­ment, in the form of:

 

	 
	
2

	

 

(x) a check payable to “Gyrotron Technology, Inc.” to:

 

Gyrotron Technology, Inc.

3412 Progress Drive

Bensalem, Pennsylvania 19020

Attention:  Vlad Sklyar; or

 

(y) a wire transfer to “Gyrotron Technology, Inc.”,

 

Wire Transfer Instructions to the Company:

 

	
Bank:

	
Wells Fargo Bank.

	
Account Name:

	
Swift WFBIUS6S

	
Gyrotron Technology Inc.

	
ABA No.:

	
121000248

	
Ref: Series B1 Units;

	
Account No.: 

	
8788010547

	
 

 

or (z) by agreeing to accept Units for funds previously advanced to the Company or other amounts due Subscriber from Company.

 

If this subscription is accepted by the Company, in whole or in part, then, as soon as practicable following the acceptance, the Company will deliver to the Subscriber a certificate representing the Shares and the Warrants that the Subscriber has subscribed for and a fully executed copy of this Agreement.

 

If the Offering is oversubscribed, or for any other reason determined by the Company in its discretion, the Company may determine to accept a subscription for only a portion of the Shares and the Warrants for which the Subscriber has subscribed in this Agreement. In such a case, the Company will deliver the portion of the Shares and the Warrants that the Company has agreed to sell to the Subscriber, and the balance of the purchase price will be repaid to the Subscriber without interest.

 

	 
	
3

	

 

(c) The Subscriber may not withdraw this subscription or any amount paid pursuant thereto.

 

2. Conditions. It is understood and agreed that this subscription is made subject to all terms and conditions set forth in this Agreement, including those set forth in Section 1 above.

 

3.  Representations and Warranties of the Company. The Company represents and warrants to, and agrees with the Subscriber as follows, in each case as of the date hereof and in all material respects as of the date of any closing, except for any changes resulting solely from the Offering:

 

(a) The Company is duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation with full power and authority to own, lease, license and use its properties and assets and to carry out the business in which it is engaged. The Company is duly qualified to transact the business in which it is engaged and is in good standing as a foreign corporation in every jurisdiction in which its ownership, leasing, licensing or use of property or assets or the conduct of its business makes such qualification necessary, except where the failure to be so qualified would not have a material adverse effect on the Company.

 

(b) The pro forma capitalization of the company as of 6/30/14 is set forth below.

 

	
BS"D

	 		 	 		 	 		 	 		 	 		 
	 	 		 	 		 	 		 	 		 	 		 
	
GYTI CAPITALIZATION

	 		 	 	6/30/2014	 	 		 	 		 	 		 
	 	 		 	 		 	 	strike/	 	 		 	 		 
	 	 	Shares	 	 	F/D Shares	 	 	conversion	 	 	Liq preference	 	 	Div rate	 
	
common

	 		
14,388,454

	 	 		
14,388,454

	 	 	 	 	 	 	 	 	 	 	 	 	 
	
Pfd A and A1

	 	 	
498,951

	 	 	 	
1,871,066

	 	 	
$

	
1.60

	 	 	
$

	
2,993,706

	 	 		
10

	
%

	
Pfd B

	 	 	
39,959

	 	 	 	
1,198,770

	 	 	
$

	
1.00

	 	 	
$

	
1,198,770

	 	 	 	
10

	
%

	
Pfd B1

	 	 	
32,737

	 	 	 	
1,636,850

	 	 	
$

	
0.70

	 	 	
$

	
1,145,795

	 	 	 	
10

	
%

	
Warrants

	 	 	
60,000

	 	 	 	
60,000

	 	 	
$

	
0.75

	 	 	 	 	 	 	 	 	 
	
Warrants

	 	 	
2,588,614

	 	 	 	
2,588,614

	 	 	
$

	
1.00

	 	 	 	 	 	 	 	 	 
		 	 	 	 	 	 	
21,743,754

	 	 	 	 	 	 	 	 	 	 	 	 	 
	
accrued dividends

	 	 	 	 	 	 	 	 	 	 	 	 	 	
$

	
393,450

	 	 	 	 	 
	
neg working capital

	 	 	 	 	 	 	 	 	 	 	 	 	 	
$

	
700,000

	 	 	 	 	 

 

	 
	
4

	

 

Except as described herein or in the Other Offer Documents, there is no commitment, plan or arrangement to issue, and no outstanding option, warrant or other right calling for the issuance of, any share of capital stock of the Company or any security or other instrument which by its terms is convertible into, exercisable for or exchangeable for capital stock of the Company. The Company may in the ordinary course pay bonuses in stock or issue options to employees. The Company is currently seeking to raise additional capital on the same terms as are offered herein.

 

(c) The Company has all requisite power and authority to execute, deliver and perform its obligations under this Agreement and to issue and sell the Shares and the Warrants.

 

All necessary proceedings of the Company have been duly taken to authorize the execution, delivery, and performance of this Agreement. This Agreement has been duly authorized by the Company and, when executed and delivered by the Company will constitute the legal, valid and binding obligation of the Company enforceable against the Company in accordance with its terms.

 

(d) No consent of any party to any contract, agreement, instrument, lease, license, arrangement or understanding to which the Company or any of its subsidiaries is a party or to which any of their respective properties or assets are subject is required for the execution, delivery or performance by the Company of any of this Agreement or the issuance and sale of the Shares or the Warrants.

 

(e) The execution, delivery and performance of this Agreement and the issuance and sale of the Shares and the Warrants will not violate or result in a breach of, or entitle any party (with or without the giving of notice or the passage of time or both) to terminate or call a default under any contract or agreement to which the Company is a party or violate or result in a breach of any term of the certificate of incorporation or by-laws of the Company, or violate any law, rule, regulation, order, judgment or decree binding upon, the Company or any of its subsidiaries, or to which any of their respective operations, businesses, properties or assets are subject, the breach, termination or violation of which, or default under which, would have a material adverse effect on the operations, business, properties or assets of the Company.

 

4. Representations, Warranties and Covenants of the Subscriber. The Subscriber hereby represents and warrants to, and agrees with, the Company as follows:

 

(a) The Subscriber is an “Accredited Investor” as that term is de­fined in Rule 501(a) of Regulation D promulgated under the Securities Act, and as spe­cifically indicated in Exhibit A to this Agreement.

 

(b) If a natural person, the Subscriber is: a bona fide resident of the state or non-United States jurisdiction contained in the address set forth on the signa­ture page of this Agreement as the Subscriber’s home address; at least 21 years of age; and legally competent to execute this Agreement. If an entity, the Subscriber has its principal offices or principal place of business in the state or non-United States jurisdic­tion contained in the address set forth on the signature page of this Agreement, the indi­vidual signing on behalf of the Subscriber is duly authorized to execute this Agreement.

 

	 
	
5

	

 

(c) This Agreement has been duly executed and delivered by the Subscriber and constitutes the legal, valid and binding obligation of the Subscriber, enforceable against the Subscriber in accordance with its terms.

 

(d) Neither the execution, delivery or performance of this Agree­ment by the Subscriber violates or conflicts with, creates (with or without the giv­ing of notice or the lapse of time, or both) a default under or a lien or encumbrance upon any of the Subscriber’s assets or properties pursuant to, or requires the consent, approval or order of any government or governmental agency or other person or entity under (i) any note, indenture, lease, license or other material agreement to which the Subscriber is a party or by which it or any of its assets or properties is bound or (ii) any statute, law, rule, regulation or court decree binding upon or applicable to the Subscriber or its assets or properties. If the Subscriber is not a natural person, the execution, delivery and per­formance by the Subscriber of this Agreement, and all other documents relating to an in­vestment by Subscriber in the Shares, have been duly authorized by all necessary corpo­rate or other action on behalf of the Subscriber and such execution, delivery and perform­ance does not and will not constitute a breach or violation of, or default under, the charter or by-laws or equivalent governing documents of the Subscriber.

 

(e) The Subscriber has received, read carefully and is familiar with this Agreement; the Certificate of Designation for the Series B1 Preferred Stock; and the form of Warrant.

 

(f) The Subscriber, together with its professional advisor, is fa­miliar with the Company’s business, plans and financial condition, the terms of the Of­fering and any other matters relating to the Offering; the Subscriber has received all ma­terials which have been requested by the Subscriber; has had a reasonable opportunity to ask questions of the Company and its representatives; and the Company has answered to the satisfaction of the Subscriber all inquiries that the Subscriber or the Subscriber’s rep­resentatives have put to it. The Subscriber has had access to all additional information that the Subscriber has deemed necessary to verify the accuracy of the information set forth in this Agreement and the Other Offer Documents, and has taken all the steps nec­essary to evaluate the merits and risks of an investment as proposed under this Agreement and the Other Offer Documents.

 

(g) The Subscriber acknowledges that this subscription is and shall be irrevocable and this subscription and the agreements contained herein shall sur­vive the insolvency, death or disability of the Subscriber (as applicable), except that the Subscriber shall have no obligation hereunder in the event that its subscription is for any reason rejected or the Offering is cancelled or terminated by the Company, which the Company reserves the right to do in its sole and absolute discretion and for any reason.

 

(h) The Subscriber or the Subscriber’s purchaser representative has such knowledge and experience in finance, securities, taxation, investments and other business matters so as to be able to protect the interests of the Subscriber in connection with this transaction.

 

(i) The Subscriber understands the various risks of an invest­ment in the Company as proposed herein and can afford to bear such risks, including, without limitation, the risks of losing the entire investment.

 

	 
	
6

	

 

(j) The Subscriber acknowledges that no market for the Shares (or the Common Shares into which they are convertible) presently exists and none may develop in the future and that the Subscriber may find it impossible to liquidate the in­vestment at a time when it may be desirable to do so, or at any other time.

 

(k) The Subscriber has been advised by the Company that nei­ther the Shares nor the Warrants being offered (or the Common Shares into which the Shares are convertible of for which the Warrants are exercisable) have been registered under the Securities Act, that the Shares and the Warrants will be issued on the basis of the statutory exemption provided by Section 4(2) of the Securities Act or Regulation D promulgated thereunder, or both, relating to transactions by an issuer not involving any public offering and under similar exemptions under certain state securities laws; that this transaction has not been reviewed by, passed on or submitted to any United States Fed­eral or state agency or self-regulatory organization where an exemption is being relied upon; and that the Company’s reliance thereon is based in part upon the representations made by the Subscriber in this Agreement.

 

(l) The Subscriber acknowledges that the Subscriber has been in­formed by the Company of, or is otherwise familiar with, the nature of the limitations imposed by the Securities Act and the rules and regulations thereunder on the transfer of the Shares and the Warrants acquired hereunder (or the Common Shares into which the Shares are convertible of for which the Warrants are exercisable). In particular, the Sub­scriber agrees that no sale, assignment or transfer of any of the Shares or the Warrants acquired by the Subscriber (or the Common Shares into which the Shares are convertible of for which the Warrants are exercisable) shall be valid or effective, and the Company shall not be required to give any effect to such a sale, assignment or transfer, unless (i) the sale, assignment or transfer of such Shares or Warrants are registered under the Secu­rities Act, it being understood that the Shares or the Warrants are not currently registered for sale and that the Company has no obligation or intention to so register the Shares or the Warrants, except as contemplated by the terms of this Agreement; (ii) the Shares (or the Common Shares into which the Shares are convertible of for which the Warrants are exercisable) are sold, assigned or transferred in accordance with all the requirements and limitations of Rule 144 under the Securities Act (it being understood that Rule 144 is not available at the present time for the sale of the Shares or the Warrants), or (iii) such sale, assignment or transfer is otherwise exempt from registration under the Securities Act, including Regulation S promulgated thereunder. The Subscriber further understands that an opinion of counsel and other documents may be required to transfer the Shares or the Warrants.

 

(m) The Subscriber acknowledges that the Shares to be ac­quired will be subject to a stop transfer order and any certificate or certificates evidencing any Shares shall bear the following or a substantially similar legend and such other leg­ends as may be required by state blue sky laws:

 

“THE SHARES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS, AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF U.S. PERSONS EXCEPT PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT.”

 

	 
	
7

	

 

The Subscriber acknowledges that the Warrants to be acquired will be subject to a stop transfer order and the certificate or certificates evidencing the War­rants shall bear the following or a substantially similar legend and such other legends as may be required by state blue sky laws:

 

“THE WARRANTS EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS, AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF U.S. PERSONS EXCEPT PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT.”

 

(n) The Subscriber will acquire the Shares and the Warrants for the Subscriber’s own account (or, if such individual is married, for the joint account of the Subscriber and the Subscriber’s spouse either in joint tenancy, tenancy by the entirety or tenancy in common) for investment and not with a view to the sale or distribution thereof or the granting of any participation therein in violation of the securities laws, and has no present intention of distributing or selling to others any of such interest or granting any participation therein in violation of the securities laws.

 

(o) No representation, guarantee or warranty has been made to the Subscriber by any broker, the Company, any of the officers, directors, stockholders, partners, employees or agents of any of them, or any other persons, whether expressly or by implication, that:

 

(I) the Company or the Subscriber will realize any given percentage of profits and/or amount or type of consideration, profit or loss as a result of the Company’s activities or the Subscriber’s invest­ment in the Company; or

 

(II) the past performance or experience of the manage­ment of the Company, or of any other person, will in any way indicate the predictable results of the ownership of the Shares or the Warrants or of the Company’s activities.

 

(p) The Subscriber is not subscribing for the Shares or the War­rants as a result of or subsequent to any advertisement, article, notice or other com­munication published in any newspaper, magazine or similar media or broadcast over television or radio, or presented at any seminar or similar gathering; or any solicitation of a subscription by a person, other than Company personnel, previously not known to the undersigned.

 

(q) The Subscriber is not relying on the Company with respect to the tax considerations or the economic merit of an investment.

 

	 
	
8

	

 

(r) The Subscriber understands that the net proceeds from all sub­scriptions paid and accepted pursuant to the Offering (after deduction for commis­sions, discounts and expenses of the Offering) will be used in all material respects to fund the business and operations of the Company in the discretion of management.

 

(s) The Subscriber acknowledges that the representations, war­ranties and agreements made by the Subscriber herein shall survive the execution and de­livery of this Agreement and the purchase of the Shares and the Warrants.

 

(t) The Subscriber has consulted the Subscriber’s own finan­cial, legal and tax advisors with respect to the economic, legal and tax consequences of an investment in the Shares and the Warrants and has not relied on the Other Offer Documents or the Company, its officers, directors or professional advisors for advice as to such consequences.

 

(u) Except as set forth on the signature page hereto, the Sub­scriber has not engaged any broker or other person or entity that is entitled to a commis­sion, fee or other remuneration as a result of the execution, delivery or performance of this Agreement.

 

(v) For California and Massachusetts individuals: If the Sub­scriber is a California resident, such Subscriber’s investment in the Company will not ex­ceed 10% of such Subscriber’s net worth (or joint net worth with his spouse). If the Sub­scriber is a Massachusetts resident, such Subscriber’s investment in the Company will not exceed 25% of such Subscriber’s joint net worth with his spouse (exclusive of principal residence and its furnishings).

 

5. Indemnification . The Subscriber understands the meaning and legal consequences of the representations and warranties contained in Section 4 hereof, and agrees to indemnify and hold harmless the Company and each officer, direc­tor, partner, employee, agent and controlling person of each of them, past, present or fu­ture, from and against any and all loss, damage or liability due to or arising out of a breach of any such representation or warranty.

 

6. Transferability. Neither this Agreement, nor any interest of the Subscriber herein, shall be assignable or transferable by the Subscriber in whole or in part except by operation of law. Any attempt to assign or transfer this agreement or any interest therein other than by operation of law shall be void. Notwithstanding the foregoing, Subscriber may transfer the securities acquired hereunder in accordance with the provisions of paragraph 4(l) above.

 

	 
	
9

	

 

7. Confidentiality. The Subscriber acknowledges and agrees that all information, written and oral, concerning the Company furnished from time to time to the Subscriber, has been and is provided on a confidential basis. The Subscriber further acknowledges and agrees that it may not disclose such information, other than to the extent that (i) the information becomes publicly available other than as a result of dis­closure in violation of the provisions of this Agreement or (ii) such disclosure is required by law, to anyone other than (I) the Subscriber’s officers, directors, employees, legal counsel, accountants or authorized agents or advisors who have a need to know such in­formation in connection with evaluating whether the Subscriber should enter into this Agreement and acquire the Shares, each of whom have agreed to the provisions of this Section 7 and (II) other stockholders of the Company and their representatives who have similarly agreed to the provisions of this Section 7. The provisions of this Section 7 shall survive the purchase of the Shares and the Warrants and/or the termination of this Agreement.

 

8.  Registration and Trading. Beginning 9 months from the date hereof, the Company agrees to pay to the Subscriber 1⁄2% per month calculated day-to-day on a 30/360 basis, of the Liquidation Preference of the Shares held by the Subscriber and acquired pursuant to this Agreement (the “Monthly Payment”), until the date that both of the following conditions shall be satisfied: (i) the Common Stock is listed for trading on a national securities exchange, an inter-dealer automated quotation system of a national association of securities dealers or listed on the OTC Pinks (or its successor or an equivalent or better regarded marketplace or listing) and (ii) the Common Shares issuable upon conversion of the Shares shall be registered under the Securities Act of 1933, as amended (the “Act”) or the Subscriber is then able to sell such Common Shares under Rule 144 promulgated pursuant to the Act (or the foreign equivalent of this condition (ii) if the listing in (i) is on a foreign exchange). The Monthly Fee will be pro rated if these condi­tions are satisfied with respect to only a portion of such Common Shares. The Monthly Payment shall be due and payable at the end of each month. If at any time during the six-month period commencing upon the day that both of the above conditions are first satisfied they are no longer satisfied, then the Company shall again become obligated to make the Monthly Payment until the above conditions have been satisfied for a period of six months in aggregate.

 

9. Miscellaneous.

 

(a) This Agreement, including the exhibits hereto, sets forth the entire understanding of the parties with respect to the subject matter hereof, super­sedes all existing agreements among them concerning such subject matter, and may be modified only by a written instrument duly executed by the party to be charged.

 

(b) Except as otherwise specifically provided herein, any no­tice or other communication required or permitted to be given hereunder shall be in writ­ing and shall be mailed by certified mail, return receipt requested, or by Federal Express, Express Mail or similar overnight delivery or courier service or delivered (in person or by telecopy, telex or similar telecommunications equipment) against receipt to the party to whom it is to be given,

 

(i) if to the Company:

Gyrotron Technology, Inc.

3412 Progress Drive

Bensalem, Pennsylvania 19020

Attention: Vlad Sklyar

Fax: (215) 244-4742

Confirm: (215) 244- 4740

 

	 
	
10

	

 

with a copy to:

 

David Lubin

David Lubin & Associates, PLLC

10 Union Ave, Suite 5

Lynbrook, NY 11563

(516) 887-8200

fax: (516) 887-8250

 

(ii) if to the Subscriber, at the address set forth on the signature page hereof,

 

or in either case, to such other address as the party shall have furnished in writing in ac­cordance with the provisions of this Section 9(b). Any notice given by means permitted by this Section 9(b) shall be deemed given at the time of receipt thereof at the address specified in this Section 9(b).

 

(c) This Agreement shall be binding upon and inure to the bene­fit of the parties hereto, the successors and assigns of the Company, and the permit­ted successors, assigns, heirs and personal representatives of the Subscriber, not includ­ing, however, any transferees of the Shares.

 

(d) The headings in this Agreement are solely for convenience of reference and shall be given no effect in the construction or interpretation of this Agreement.

 

(e) This Agreement may be executed in any number of counter­parts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

 

(f) This Agreement shall be governed by and construed in accor­dance with the laws of the State of New York, without giving effect to principles governing conflicts of law that would defer to the substantive law of another jurisdiction. The parties hereby irrevocably consent to resolve any disputes in connection with, arising out of, or relating to this agreement by arbitration in New York City in front of three arbitrators with each party picking one arbitrator and the two selected arbitrators picking a third. Without limiting the foregoing, no action or proceeding in connection with, arising out of, or relating to this agreement shall be brought by the parties hereto in any court other than the courts of the State of New York or any federal court located in such State.

 

(g) This Agreement does not create, and shall not be construed as creating, any rights enforceable by any person not a party to this Agreement (except as specifically provided in this Agreement).

 

 [Signature page follows]

 

	 
	
11

	

 

SIGNATURE PAGE

 

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year this subscription has been accepted by the Company as set forth below.

 

 

	
Units Subscribed For:

		
Print Name of Subscriber

	
 

	
 

	
 

	
 

	
 

		
 

	
 

		
 

	
 

	
 

	
By:

	
 

	
 

	
Social Security Number or other

Taxpayer Identification Number

	
 

	
 

	
(Signature of Subscriber or

Authorized Signatory)

	
 

	
 

	
 

	
Address:

	
 

	
	
 

	
 

	
 

	
 

	
	
 

	
 

	
 

	
 

	
	
 

	
 

	
 

	
 

	
	
 

	
 

	
Telephone:

	
 

	
	
 

	
 

	
 

	
 

	
	
 

	
 

	
Fax:

	
 

	

 

If the Shares will be held as joint tenants, tenants in common, or community property, please complete the following:

 

 

	 	 	 
	 	
Print name of spouse or other co-subscriber

	 
	 	 	 
	 	 	 
	 	
Signature of spouse or other co-subscriber

	 
	 	 	 
	 	 	 
	 	
Print manner in which Shares and Warrant will be held

	 

 

 

If the Shares and the Warrants have been purchased through a broker or other intermedi­ary, please identify such entity: 

 

[Please complete Exhibit A for each subscriber.]

 

	 
	
12

	

 

ACCEPTANCE OF SUBSCRIPTION

 

	
 

	
 

	
 

		
 

	
 

	
 

	
 

	
Name of Subscriber

	
 

	
ACCEPTED BY:

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
GYROTRON TECHNOLOGY, INC.

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
By:

	
 

	
 

	
 

	
 

	
Name:

	
 

	
 

	
 

	
 

	
Title:

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
Date: _______________, 2014

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
Funds Received: ____________, 2014

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
Accepted for ________________ Units

	
 

	
 

	
 

 

	 
	
13

	

 

EXHIBIT A

ACCREDITED INVESTOR STATUS

 

The oversigned subscriber represents that it is an Accredited Investor on the basis that it is (check one):

 

_____(i) A bank as defined in Section 3(a)(2) of the Act, or a savings and loan association or other institution as defined in Section 3(a)(5)(A) of the Act, whether acting in its individual or fiduciary capacity; a broker or dealer registered pursuant to Section 15 of the Securities Exchange Act of 1934; an insurance company as defined in Section 2(13) of the Act; an investment company registered under the Investment Company Act of 1940 (the “Investment Company Act”) or a business development company as defined in Section 2(a)(48) of the Investment Company Act; a Small Business Investment Company li­censed by the U.S. Small Business Administration under Section 301(c) or (d) of the Small Business In­vestment Act of 1958; a plan established and maintained by a state, its political subdivisions or any agency or instrumentality of a state or its political subdivisions for the benefit of its employees, if such plan has total assets in excess of $5,000,000; an employee benefit plan within the meaning of the Employee Retirement Income Security Act of 1974 (“ERISA”), if the investment decision is made by a plan fiduciary, as defined in Section 3(21) of ERISA, which is either a bank, savings and loan association, insurance company, or registered investment advisor, or if the employee benefit plan has total assets in excess of $5,000,000 or, if a self-directed plan, with investment decisions made solely by persons that are accredited investors.

 

_____(ii) A private business development company as defined in Section 202(a)(22) of the In­vestment Advisers Act of 1940.

 

_____(iii) An organization described in Section 501(c)(3) of the Internal Revenue Code, corpo­ration, Massachusetts or similar business trust, or partnership, not formed for the specific purpose of ac­quiring the securities offered, with total assets in excess of $5,000,000.

 

_____(iv) A director or executive officer of the Company.

 

_____(v) A natural person whose individual net worth, or joint net worth with that person’s spouse, at the time of his or her purchase exceeds $1,000,000 excluding his/their principal residence.

 

_____(vi) A natural person who had an individual income in excess of $200,000 in each of the two most recent years or joint income with that person’s spouse in excess of $300,000 in each of those years and has a reasonable expectation of reaching the same income level in the current year.

 

_____(vii) A trust, with total assets in excess of $5,000,000, not formed for the specific purpose of acquiring the securities offered, whose purchase is directed by a sophisticated person as described in Rule 506(b)(2)(ii) (i.e., a person who has such knowledge and experience in financial and business mat­ters that he is capable of evaluating the merits and risks of the prospective investment).

 

_____(viii) An entity in which all of the equity owners are accredited investors. (If this alterna­tive is checked, the Subscriber must identify each equity owner and provide statements signed by each demonstrating how each is qualified as an accredited investor. Further, the Subscriber represents that it has made such investigation as is reasonably necessary in order to verify the accuracy of this alternative.

 

 

14Prepared by R.R. Donnelley Financial -- EX-4.2

 Exhibit 4.2 
  

 
 SOLARCITY CORPORATION, as Issuer, 

-and- 
 U.S. BANK NATIONAL
ASSOCIATION, as Trustee 
  
  

FIRST SUPPLEMENTAL INDENTURE 

Dated as of October 15, 2014 

to 
 INDENTURE 

Dated as of October 15, 2014 
  

 
 2.00% Solar
Bonds, Series 2014/1-1 
  
  

 

 TABLE OF CONTENTS 

 

							
	 	 	 	  	PAGE	 
	ARTICLE 1	  
	DEFINITIONS	  
			
	 SECTION 1.01
	 	Scope of Supplemental Indenture	  	 	2	  
	 SECTION 1.02
	 	Definitions	  	 	2	  
	
	ARTICLE 2	  
	ISSUE, DESCRIPTION, EXECUTION, REGISTRATION AND EXCHANGE OF NOTES	  
			
	 SECTION 2.01
	 	Title and Terms	  	 	3	  
	 SECTION 2.02
	 	Company Global Securities	  	 	3	  
	 SECTION 2.03
	 	Payments	  	 	4	  
	
	ARTICLE 3	  
	MISCELLANEOUS PROVISIONS	  
			
	 SECTION 3.01
	 	Trustee Acceptance	  	 	4	  
	 SECTION 3.02
	 	Governing Law	  	 	5	  
	 SECTION 3.03
	 	Trust Indenture Act	  	 	5	  
	 SECTION 3.04
	 	Execution in Counterparts	  	 	5	  
	 SECTION 3.05
	 	Severability	  	 	5	  
	 SECTION 3.06
	 	Appointment of Paying Agent and Security Registrar	  	 	5	  
	 SECTION 3.07
	 	Ratification of Original Indenture	  	 	5	  
	
	EXHIBIT	  
		
	 Exhibit A     Form of Note
	  	 	A-1	  

  
 i 

 FIRST SUPPLEMENTAL INDENTURE, dated as of October 15, 2014 (the “Supplemental
Indenture”), between SolarCity Corporation, a Delaware corporation (hereinafter called the “Company”), having its principal executive office located at 3055 Clearview Way, San Mateo, California, 94402, and U.S. Bank National
Association, a national banking association duly organized and existing under the laws of the United States of America, as trustee (in such capacity, the “Trustee”), to the indenture, dated as of October 15, 2014, between the Company
and the Trustee (as amended or supplemented from time to time in accordance with the terms thereof, the “Original Indenture”). 

RECITALS OF THE COMPANY 

WHEREAS, the Company executed and delivered the Original Indenture to the Trustee to provide, among other things, for the issuance, from time
to time, of the Company’s Securities, unlimited as to principal amount, in one or more series to be established by the Company under, and authenticated and delivered as provided in, the Original Indenture; 

WHEREAS, Section 801(8) of the Original Indenture provides for the Company and the Trustee to enter into a supplemental indenture to the
Original Indenture to provide for the issuance of and establish the forms and terms and conditions of Securities as permitted by Sections 201 and 301 of the Original Indenture; 

WHEREAS, the Board of Directors has duly adopted resolutions authorizing the Company to execute and deliver this Supplemental Indenture; 

WHEREAS, pursuant to the terms of the Original Indenture, the Company desires to establish a new series of its Securities to be known as its
2.00% Solar Bonds, Series 2014/1-1 (the “Notes”), the form and substance of such Notes and the terms, provisions and conditions thereof to be set forth as provided in the Original Indenture and this Supplemental Indenture; 

WHEREAS, the Form of Note contemplated under the terms of the Notes is to be substantially in the form hereinafter provided; and 

WHEREAS, the Company has requested that the Trustee execute and deliver this Supplemental Indenture, and all requirements necessary to make
(i) this Supplemental Indenture a valid instrument in accordance with its terms, and (ii) the Notes, when executed by the Company and authenticated and delivered by the Trustee, the valid obligations of the Company, in each case, have been
performed, and the execution and delivery of this Supplemental Indenture have been duly authorized in all respects. 
 NOW, THEREFORE, THIS
SUPPLEMENTAL INDENTURE WITNESSETH, for and in consideration of the premises and the purchases of the Notes by the Holders thereof, it is mutually agreed, for the benefit of the Company and the equal and proportionate benefit of all Holders of the
Notes, as follows: 

 ARTICLE 1 

DEFINITIONS 

SECTION 1.01 Scope of Supplemental Indenture. The changes, modifications and supplements to the Original Indenture effected by
this Supplemental Indenture shall be applicable only with respect to, and shall only govern the terms of (and only the rights of the Holders and the obligations of the Company with respect to), the Notes, which may be issued from time to time, and
shall not apply to any other Securities that may be issued under the Original Indenture (or govern the rights of the Holders or the obligations of the Company with respect to any other such Securities) unless a supplemental indenture with respect to
such other Securities specifically incorporates such changes, modifications and supplements. The provisions of this Supplemental Indenture shall supersede any corresponding or conflicting provisions in the Original Indenture. 

SECTION 1.02 Definitions. For all purposes of the Indenture, except as otherwise expressly provided or unless the context
otherwise requires: 
 (i) the terms defined in this Article 1 shall have the meanings assigned to them in this Article 1 and
include the plural as well as the singular; 
 (ii) all words, terms and phrases defined in the Original Indenture (but not
otherwise defined herein) shall have the same meanings as in the Original Indenture; 
 (iii) all other terms used herein
that are defined in the Trust Indenture Act, either directly or by reference therein, shall have the meanings assigned to them in the Trust Indenture Act; 

(iv) all accounting terms not otherwise defined herein shall have the meanings assigned to them in accordance with generally
accepted accounting principles, and, except as otherwise herein expressly provided, the term “generally accepted accounting principles” with respect to any computation required or permitted hereunder shall mean such accounting principles
as are generally accepted at the date of this instrument; and 
 (v) the words “herein,” “hereof” and
“hereunder” and other words of similar import refer to this Supplemental Indenture as a whole and not to any particular Article, Section or other subdivision. 

“Company” has the meaning set forth in the first paragraph of this Supplemental Indenture. 

“Form of Note” shall mean the “Form of Note” attached hereto as Exhibit A. 

“Indenture” means the Original Indenture, as originally executed and as supplemented from time to time by one or more indentures
supplemental thereto, including this Supplemental Indenture, entered into pursuant to the applicable provisions of the Indenture, including, for all purposes of this instrument and any such supplemental indenture, the provisions of the Trust
Indenture Act that are deemed to be a part of and govern the Original Indenture and this Supplemental Indenture. 

  
 2 

 “Initial Notes” has the meaning specified in Section 2.01. 

“Interest Payment Date” means February 15 and August 15 of each year, beginning on February 15, 2015. 

“Issue Date” means, with respect to Notes owned by any Holder, the date upon which such Notes were originally issued to such Holder
(or transferor of such Holder), as set forth on the Security Register. 
 “Note” or “Notes” has the meaning specified in
the fourth paragraph of the recitals of this Supplemental Indenture, and shall include any Additional Notes issued pursuant to Section 2.01. 

“Noteholder,” “Holder” or “holder” as applied to any Note, or other similar terms (but excluding the term
“beneficial holder”), means any Person in whose name at the time a particular Note is registered in the Security Register. 

“Original Indenture” has the meaning specified in the first paragraph of this Supplemental Indenture. 

“Regular Record Date” for the interest payable on any Interest Payment Date means the fifteenth day prior to such Interest Payment
Date (whether or not a Business Day). 
 “Stated Maturity” means, with respect to the payment of principal on the Notes,
October 15, 2015. 
 “Supplemental Indenture” has the meaning specified in the first paragraph hereof. 

ARTICLE 2 
 ISSUE,
DESCRIPTION, EXECUTION, REGISTRATION AND EXCHANGE OF NOTES 
 SECTION 2.01 Title and Terms. There is hereby established a
series of Securities designated the “2.00% Solar Bonds, Series 2014/1-1”. The aggregate principal amount of the Notes shall not be limited and shall be initially authenticated and delivered from time to time upon delivery to the Trustee of
the documents required by Section 303 of the Indenture. The Notes shall be issued only in fully registered form, in denominations of $1,000 and any integral multiples thereof. 

SECTION 2.02 Company Global Securities. The Notes initially shall be represented by one or more permanent Company Global
Securities. The Form of Note shall be substantially as set forth in Exhibit A, which is incorporated into and shall be deemed a part of this Supplemental Indenture, with such appropriate insertions, omissions, substitutions and other
variations as are required or permitted by the Indenture, and may have such letters, numbers or other marks of identification and such legends or endorsements placed thereon as may be required to comply with the rules of any securities exchange or
as may, consistently herewith, be determined to be necessary or appropriate by the Officers of the Company executing such Notes, as evidenced by their execution of the Notes. 

  
 3 

 SECTION 2.03 Payments. 

The principal amount of Notes then Outstanding shall be payable at the Stated Maturity. Interest on the Notes shall accrue at a rate of
2.00% per annum, from and including the Issue Date with respect to such Notes, or from the most recent date on which interest has been paid or duly provided for with respect to such Notes, to, but excluding, the next Interest Payment Date,
until the principal thereof is paid or made available for payment. Interest shall be payable in arrears on each Interest Payment Date, beginning on February 15, 2015, to the Persons in whose name a Note is registered on the Security Register at
the Close of Business on the Regular Record Date immediately preceding the applicable Interest Payment Date. If any Stated Maturity or Maturity of, or any other day on which a payment is due shall be a day which is not a Business Day, then such
payment may be made on the next succeeding day that is a Business Day with the same force and effect as if made at the Stated Maturity or Maturity or on any such other payment date, as the case may be, and no interest shall accrue on the amount
payable on such date or at such time for the period from and after such Stated Maturity, Maturity or other payment date, as the case may be, to the next succeeding Business Day. Interest will be computed on the basis of twelve 30-day months and a
360-day year. The amount of interest payable for any period shorter than a full quarterly interest period will be computed on the basis of the number of days elapsed in a 90-day quarter of three 30-day months. Up to $10,000,000 aggregate principal
amount of Notes will be authenticated on the date of this Supplemental Indenture (the “Initial Notes”). 
 The Company may,
without the consent of the Holders of the Notes, hereafter issue additional Notes (“Additional Notes”) under the Indenture with the same terms and conditions, except for any difference in the issue price, Issue Date and interest accrued
prior to the issue date of the Additional Notes, as the Initial Notes, in an unlimited aggregate principal amount. Any such Additional Notes shall constitute a single series together with the Initial Notes for all purposes hereunder, including,
without limitation, for purposes of any waivers, supplements or amendments to the Indenture requiring the approval of Holders of the Notes and any offers to purchase the Notes. 

The Company shall pay the principal of and interest on any Note in immediately available funds to the Persons in whose name such Note is
registered in the Security Register, at the office or agency designated by the Company for that purpose. All payments on the Notes will be made in US. Dollars or in such other coin or currency of the United States of America as of the time of
payment is legal tender for the payment of public and private debts. 
 ARTICLE 3 

MISCELLANEOUS PROVISIONS 

SECTION 3.01 Trustee Acceptance. The Trustee has accepted the amendment of the Original Indenture effected by this Supplemental
Indenture and agrees to execute the trust created by the Original Indenture as hereby amended, but only upon the terms and conditions set forth in the Indenture, including the terms and provisions defining and limiting the liabilities and 

  
 4 

 
responsibilities of the Trustee, and without limiting the generality of the foregoing, the Trustee shall not be responsible in any manner whatsoever for or with respect of any of the recitals or
statements contained herein, all of which recitals or statements are made solely by the Company, or for or with respect to (a) the validity or sufficiency of this Supplemental Indenture or any of the terms or provisions hereof, (b) the
proper authorization hereof by the Company by corporate action or otherwise, and (c) the due execution hereof by the Company. 

SECTION 3.02 Governing Law. This Supplemental Indenture and the Notes shall be governed by, and construed in accordance with, the
laws of the State of New York. 
 SECTION 3.03 Trust Indenture Act. This Supplemental Indenture will be subject to, and governed
by, the provisions of the Trust Indenture Act that are required to be part of this Supplemental Indenture and shall, to the extent applicable, be governed by such provisions. 

SECTION 3.04 Execution in Counterparts. This Supplemental Indenture may be executed in any number of counterparts, each of which
shall be an original, but such counterparts shall together constitute but one and the same instrument. 
 SECTION 3.05
Severability. In case any provision in this Supplemental Indenture or in the Notes shall be invalid, illegal or unenforceable, then (to the extent permitted by law) the validity, legality and enforceability of the remaining provisions shall
not in any way be affected or impaired thereby. 
 SECTION 3.06 Appointment of Paying Agent and Security Registrar. The Company
is hereby appointed to act as Paying Agent and Security Registrar subject to and in accordance with the terms and conditions set forth herein and in the Original Indenture and shall have all of the rights, benefits and immunities of a Paying Agent
and Security Registrar as set forth herein and therein. 
 SECTION 3.07 Ratification of Original Indenture. The Original
Indenture, as supplemented by this Supplemental Indenture, is in all respects ratified and confirmed, and this Supplemental Indenture shall be deemed part of the Original Indenture in the manner and to the extent herein and therein provided. For the
avoidance of doubt, each of the Company and each Holder of the Notes, by its acceptance of such Notes, acknowledges and agrees that all of the rights, privileges, protections, immunities and benefits afforded to the Trustee and the Agents under the
Original Indenture are deemed to be incorporated herein, and shall be enforceable by the Trustee and the Agents hereunder, as if set forth herein in full. 

U.S. Bank, National Association hereby accepts the trusts in this Supplemental Indenture declared and provided, upon the terms and conditions
herein above set forth. 
 [Remainder of the page intentionally left blank] 

  
 5 

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

			
	 SOLARCITY CORPORATION

		
	By:	 	 /s/ Brad Buss

		 	Name: Brad Buss
		 	Title: Chief Financial Officer
	
	U.S. BANK, NATIONAL ASSOCIATION, as Trustee
		
	By:	 	 /s/ K. Wendy Kumar

		 	Name: K. Wendy Kumar
		 	Title: Vice President

 Exhibit A 

Form of Note 

  
 7 

 FORM OF NOTE 

SOLARCITY CORPORATION 
 2.00% SOLAR
BONDS, SERIES 2014/1-1 
 No. [    ] 

SolarCity Corporation, a Delaware corporation (herein called the “Company,” which term includes any successor Person under the
Indenture referred to on the reverse hereof), for value received hereby promises to pay to each of the Holders listed on Schedule A hereto, or their registered assigns, the principal sum set forth next to such Holder’s name on
Schedule A (the aggregate of which principal sums shall not exceed $10,000,000), on October 15, 2015 at the office or agency of the Company maintained for that purpose in accordance with the terms of the Indenture, in such coin or
currency of the United States of America as at the time of payment shall be legal tender for the payment of public and private debts, and to pay interest, semiannually, on February 15 and August 15 of each year (each, an “Interest
Payment Date”), commencing on the Issue Date set forth set forth next to such Holder’s name on Schedule A, on said principal sum at said office or agency, in like coin or currency, at the rate per annum of 2.00%, from and including
the most recent Interest Payment Date in respect of which interest has been paid (or commencing on the Issue Date set forth set forth next to such Holder’s name on Schedule A if no interest has been paid hereon). If any Stated Maturity
or Maturity of, or any other day on which a payment is due shall be a day which is not a Business Day, then such payment may be made on the next succeeding day that is a Business Day with the same force and effect as if made at the Stated Maturity
or Maturity or on any such other payment date, as the case may be, and no interest shall accrue on the amount payable on such date or at such time for the period from and after such Stated Maturity, Maturity or other payment date, as the case may
be, to the next succeeding Business Day. Interest will be computed on the basis of twelve 30-day months and a 360-day year. The amount of interest payable for any period shorter than a full quarterly interest period will be computed on the basis of
the number of days elapsed in a 90-day quarter of three 30-day months. 
 Reference is made to the further provisions of this Note set forth
on the reverse hereof. Such further provisions shall for all purposes have the same effect as though fully set forth at this place. 
 This
Note shall not be valid or become obligatory for any purpose until the certificate of authentication hereon shall have been manually signed by the Trustee or other duly authorized Authenticating Agent under the Indenture. 

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

Dated: [    ] 
  

			
	SOLARCITY CORPORATION
		
	By:	 	  

		 	Name:
		 	Title:

  

			
	ATTEST:
		
	By	 	  

		 	Name:
		 	Title:

 TRUSTEE’S CERTIFICATE OF AUTHENTICATION 

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

U.S. BANK NATIONAL ASSOCIATION 
 as Trustee 

 

			
	By:	 	  

		 	Authorized Signatory

 FORM OF REVERSE OF NOTE 

SOLARCITY CORPORATION 
 2.00% SOLAR
BONDS, SERIES 2014/1-1 
 This note is one of a duly authorized issue of notes of the Company, designated as its “2.00% Solar Bonds,
Series 2014/1-1” (herein called the “Notes”), issued under and pursuant to an Indenture, dated as of October 15, 2014 (the “Original Indenture”), between the Company and U.S. Bank National Association, as trustee (in
such capacity, the “Trustee”), as supplemented with respect to the Notes by the First Supplemental Indenture, dated as of October 15, 2014 (the “Supplemental Indenture,” and together with the Original Indenture, the
“Indenture”), between the Company, as issuer, paying agent and security registrar (herein called the “ Paying Agent and Security Registrar”), and the Trustee, as trustee, and as the authenticating agent (herein called the
“Authenticating Agent”), to which Indenture and all indentures supplemental thereto reference is hereby made for a description of the rights, limitations of rights, obligations, duties and immunities thereunder of the Trustee,
Authenticating Agent, Paying Agent, Security Registrar, the Company and the Holders of the Notes. Capitalized terms used but not otherwise defined in this Note shall have the respective meanings ascribed thereto in the Indenture. 

If an Event of Default (other than an Event of Default specified in clauses (4), (5) or (6) of Section 501 of the Indenture)
occurs and is continuing with respect to the Notes, then the Trustee, or the Holders of not less than 25% in aggregate principal amount of the Notes may declare the principal of all the Notes, and accrued and unpaid interest, if any, and premium, if
any, thereon to be due and payable immediately. If an Event of Default specified in clauses (4), (5) or (6) of Section 501 occurs, then the principal and accrued and unpaid interest, if any, and premium, if any, on all the Notes shall
ipso facto become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holder of the Notes. 

Subject to the provisions of the Indenture, the Holders of not less than a majority in aggregate principal amount of the Notes at the time
Outstanding may, on behalf of the Holders of all of the Notes, waive any past default or Event of Default, subject to exceptions set forth in the Indenture. Upon any such waiver, said default shall for all purposes of this Note and the Indenture be
deemed to have been cured and not to be continuing, but no such waiver shall extend to any subsequent or other default or impair any right consequent thereon. 

The Indenture contains provisions permitting the Company and the Trustee, with the consent of the Holders of not less than a majority in
aggregate principal amount of the Notes at the time Outstanding, to execute supplemental indentures to modify provisions of the Indenture, subject to exceptions permitting the modification of the Indenture without the consent of any Holder of Notes
or requiring the consent of each Holder of a Note affected by such modification all as set forth in the Indenture. 
 The Notes are issuable
in fully registered form, without coupons, in denominations of $1,000 principal amount and any integral multiples thereof. The Notes may be exchanged for a like aggregate principal amount of Notes of any other authorized denominations, on the terms
and subject to the conditions and limitations set forth in the Indenture. 

 The Company, the Trustee, Authenticating Agent, Paying Agent and Security Registrar may deem the
Persons in whose name this Note shall be registered upon the Security Register to be, and may treat them as, the absolute owners of this Note with respect to the principal sum set forth opposite such Person’s name on Schedule A hereto
(whether or not amounts under this Note shall be overdue and notwithstanding any notation of ownership or other writing thereon made by any Person other than the Company or any Security Registrar), for the purpose of receiving payment of or on
account of the principal of, and interest on this Note and for all other purposes; and neither the Company or the Trustee nor any Authenticating Agent, Paying Agent or any Security Registrar shall be affected by any notice to the contrary. All such
payments so made to any Holders for the time being, or upon their orders, shall be valid, and, to the extent of the sum or sums so paid, effectual to satisfy and discharge the liability for monies payable upon this Note. 

No recourse for the payment of the principal of or interest on this Note, or for any claim based hereon or otherwise in respect hereof, and no
recourse under or upon any obligation, covenant or agreement of the Company in the Indenture or any supplemental indenture or in any Note, or because of the creation of any indebtedness represented hereby, shall be had against any incorporator,
stockholder, partner, member, manager, employee, agent, officer, director or subsidiary, as such, past, present or future, of the Company or any of the Company’s subsidiaries or of any successor thereto, either directly or through the Company
or any of the Company’s subsidiaries or of any successor thereto, whether by virtue of any constitution, statute or rule of law, or by the enforcement of any assessment or penalty or otherwise; it being expressly understood that all such
liability is hereby expressly waived and released as a condition of, and as consideration for, the execution of the Indenture and the issue of this Note. 

In the case of any conflict between the provisions of this Note and the Indenture, the provisions of the Indenture shall control. The
Indenture and this Note shall be governed by, and construed in accordance with, the laws of the State of New York. 

 Schedule A 

SOLARCITY CORPORATION 
 2.00% SOLAR
BONDS, SERIES 2014/1-1 
  

					
	 Name of Holder
	  	Principal Amount	  	Issue Date
		  		  	

 Aggregate Principal Amount Outstanding:

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00236-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00236-of-00352.parquet"}]]