Document:

Exhibit 10.2

 

SUBSCRIPTION
AGREEMENT

 

VectoIQ
Acquisition Corp.

1354
Flagler Drive

Mamaroneck,
NY 10543

 

Ladies
and Gentlemen:

 

In
connection with the proposed business combination (the “Transaction”) between VectoIQ Acquisition Corp., a
Delaware corporation (the “Company”), and Nikola Corporation, a Delaware corporation (“Nikola”),
the undersigned desires to subscribe for and purchase from the Company, and the Company desires to sell to the undersigned, that
number of shares of the Company’s common stock, par value $0.0001 per share (the “Common Stock”), set
forth on the signature page hereof for a purchase price of $10.00 per share (the “Per Share Price” and the aggregate
of such Per Share Price for all Shares subscribed for by the undersigned being referred to herein as the “Purchase Price”),
on the terms and subject to the conditions contained herein. In connection with the Transaction, certain other “accredited
investors” (as defined in rule 501 under the Securities Act of 1933, as amended (the “Securities Act”))
have entered into separate subscription agreements with the Company (the “Other Subscription Agreements”), pursuant
to which such investors have, together with the undersigned pursuant to this Subscription Agreement, agreed to purchase an aggregate
of 52,500,000 shares of Common Stock at the Per Share Price (each such investor, including the undersigned, a “Subscriber”
and together, the “Subscribers”). In connection therewith, the undersigned and the Company agree as follows:

 

1.                 
Subscription. Subject to the immediately succeeding paragraph, the undersigned hereby irrevocably subscribes for
and agrees to purchase from the Company such number of shares of Common Stock as is set forth on the signature page of this Subscription
Agreement on the terms and subject to the conditions provided for herein (the “Shares”). The undersigned understands
and agrees that the Company reserves the right to accept or reject the undersigned’s subscription for the Shares for any
reason or for no reason, in whole or in part, at any time prior to its acceptance by the Company, and the same shall be deemed
to be accepted by the Company only when this Subscription Agreement is signed by a duly authorized person by or on behalf of the
Company; the Company may do so in counterpart form. In the event of rejection of the entire subscription by the Company or the
termination of this subscription in accordance with the terms hereof, the undersigned’s payment hereunder will be returned
promptly to the undersigned along with this Subscription Agreement, and this Subscription Agreement shall have no force or effect.

 

2.                 
Closing. The closing of the sale of the Shares contemplated hereby (the “Subscription Closing”)
is contingent upon the substantially concurrent consummation of the Transaction (the “Transaction Closing”).
The Subscription Closing shall occur on the date of, and immediately prior to, the consummation of the Transaction (the “Transaction
Closing Date”). Not less than five (5) business days prior to the scheduled Transaction Closing Date, the Company shall
provide written notice to the undersigned (the “Closing Notice”) (i) of such scheduled Transaction Closing
Date and (ii) that the Company reasonably expects all conditions to the closing of the Transaction to be satisfied or waived.
The undersigned shall deliver to Continental Stock Transfer & Trust Company, as escrow agent (the “Escrow Agent”),
at least one (1) business day prior to the Transaction Closing Date specified in the Closing Notice, the Purchase Price, which
shall be held in a segregated escrow account for the benefit of the Subscriber (the “Escrow Account”) until
the Subscription Closing pursuant to the terms of a customary escrow agreement, which shall be on terms and conditions reasonably
satisfactory to the undersigned (the “Escrow Agreement”) to be entered into by the undersigned, the Company
and the Escrow Agent, by wire transfer of United States dollars in immediately available funds to the account specified by the
Company in the Closing Notice. On the Transaction Closing Date, the Company shall deliver to the undersigned (i) the Shares in
book-entry form, or, if required by the undersigned, certificated form, free and clear of any liens or other restrictions whatsoever
(other than those arising under state or federal securities laws as set forth herein), in the name of the undersigned (or its
nominee in accordance with its delivery instructions) or to a custodian designated by the undersigned, as applicable, and (ii) a
copy of the records of the Company’s transfer agent (the “Transfer Agent”) showing the undersigned (or
such nominee or custodian) as the owner of the Shares on and as of the Transaction Closing Date. Upon delivery of the Shares to
the undersigned (or its nominee or custodian, if applicable), the Purchase Price shall be released from the Escrow Account automatically
and without further action by the Company or the undersigned.

 

     

     

    

 

If
the Transaction Closing does not occur within two (2) business days of the Transaction Closing Date specified in the Closing Notice,
the Escrow Agent shall promptly (but not later than one (1) business day thereafter) return the Purchase Price to the undersigned
by wire transfer of U.S. dollars in immediately available funds to the account specified by the undersigned. Furthermore, if the
Transaction Closing does not occur on the same day as the Subscription Closing, the Escrow Agent (or the Company, if the Purchase
Price has been released by the Escrow Agent) shall promptly (but not later than one (1) business day thereafter) return the
Purchase Price to the undersigned by wire transfer of U.S. dollars in immediately available funds to the account specified by
the undersigned, and any book-entries and, if applicable, certificated shares, shall be deemed cancelled (and, in the case of
certificated shares, the undersigned shall promptly return such certificates to the Company or, as directed by the Company, to
the Company’s representative or agent).

 

If
this Subscription Agreement terminates following the delivery by the undersigned of the Purchase Price for the Shares, the Escrow
Agent shall promptly (but not later than one (1) business day thereafter) return the Purchase Price to the undersigned, whether
or not the Transaction Closing shall have occurred. If this Subscription Agreement terminates following the Transaction Closing,
the undersigned shall promptly upon the return to the undersigned of the Purchase Price by the Escrow Agent, transfer the Shares
to the Company.

 

3.                 
Closing Conditions.

 

a.                  
The obligations of the Company to consummate the transactions contemplated hereunder are subject to the conditions that,
at the Subscription Closing:

 

		i.	all
                                         representations and warranties of the undersigned contained in this Subscription Agreement
                                         shall be true and correct in all material respects (other than representations and warranties
                                         that are qualified as to materiality or Material Adverse Effect (as defined herein),
                                         which representations and warranties shall be true in all respects) at and as of the
                                         Subscription Closing, and consummation of the Subscription Closing shall constitute a
                                         reaffirmation by the undersigned of each of the representations, warranties and agreements
                                         of such party contained in this Subscription Agreement as of the Subscription Closing,
                                         but in each case without giving effect to consummation of the Transaction; and

 

    2

     

    

 

		ii.	the
                                         undersigned shall have performed or complied in all material respects with all agreements
                                         and covenants required by this Subscription Agreement.

 

b.                 
The obligations of the undersigned to consummate the transactions contemplated hereunder are subject to the conditions
that, at the Subscription Closing:

 

		i.	all
                                         representations and warranties of the Company contained in this Subscription Agreement
                                         shall be true and correct in all material respects (other than representations and warranties
                                         that are qualified as to materiality or Material Adverse Effect (as defined herein),
                                         which representations and warranties shall be true in all respects) at and as of the
                                         Subscription Closing, and consummation of the Subscription Closing shall constitute a
                                         reaffirmation by the Company of each of the representations, warranties and agreements
                                         of such party contained in this Subscription Agreement as of the Subscription Closing,
                                         but in each case without giving effect to consummation of the Transaction;

 

		ii.	the
                                         Company shall have performed or complied in all material respects with all agreements
                                         and covenants required by this Subscription Agreement; and

 

		iii.	the
                                         terms of the Transaction Agreement (as defined below) shall not have been amended in
                                         a manner that is materially adverse to the undersigned as a shareholder of the Company,
                                         including, without limitation, any amendment or waiver of any material representation
                                         or covenant of the Company relating to the financial position or outstanding indebtedness
                                         of the Company.

 

c.                  
The obligations of each of the Company and the undersigned to consummate the transactions contemplated hereunder are subject
to the conditions that, at the Subscription Closing:

 

		i.	no
                                         governmental authority shall have enacted, issued, promulgated, enforced or entered any
                                         judgment, order, law, rule or regulation (whether temporary, preliminary or permanent)
                                         which is then in effect and has the effect of making consummation of the transactions
                                         contemplated hereby illegal or otherwise restraining or prohibiting consummation of the
                                         transactions contemplated hereby, and no governmental authority shall have instituted
                                         or threatened in writing a proceeding seeking to impose any such restraint or prohibition;
                                         and

 

    3

     

    

 

		ii.	all
                                         conditions precedent to the closing of the Transaction, including the approval of the
                                         Company’s stockholders, shall have been satisfied or waived (other than those conditions
                                         which, by their nature, are to be satisfied at the closing of the Transaction).

 

4.                 
Further Assurances. At the Subscription Closing, the parties hereto shall execute and deliver such additional documents
and take such additional actions as the parties reasonably may deem to be practical and necessary in order to consummate the subscription
as contemplated by this Subscription Agreement.

 

5.                 
Company Representations and Warranties. The Company represents and warrants to the undersigned that:

 

a.                 
The Company has been duly incorporated, is validly existing and is in good standing under the laws of the State of Delaware,
with corporate power and authority to own, lease and operate its properties and conduct its business as presently conducted.

 

b.                 
The Shares have been duly authorized and, when issued and delivered to the undersigned against full payment therefor in
accordance with the terms of this Subscription Agreement, the Shares will be validly issued, fully paid and non-assessable and
will not have been issued in violation of or subject to any preemptive or similar rights created under the Company’s Amended
and Restated Certificate of Incorporation or under the laws of the State of Delaware.

 

c.                 
The Shares are not, and following the Transaction Closing and the Subscription Closing will not be, subject to any Transfer
Restriction. The term “Transfer Restriction” means any condition to or restriction on the ability of the undersigned
to pledge, sell, assign or otherwise transfer the Shares under any organizational document, policy or agreement of, by or with
the Company, but excluding the restrictions on transfer described in paragraph 6(c) of this Subscription Agreement with respect
to the status of the Shares as “restricted securities” pending their registration for resale under the Securities
Act of 1933, as amended (the “Securities Act”) in accordance with the terms of this Subscription Agreement.

 

d.                 
This Subscription Agreement has been duly authorized, executed and delivered by the Company and is enforceable in accordance
with its terms, except as may be limited or otherwise affected by (i) bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium or other laws relating to or affecting the rights of creditors generally, and (ii) principles of equity, whether considered
at law or equity.

 

    4

     

    

 

e.                 
The issuance and sale of the Shares and the compliance by the Company with all of the provisions of this Subscription Agreement
and the consummation of the transactions herein will not conflict with or result in a breach or violation of any of the terms
or provisions of, or constitute a default under, or result in the creation or imposition of any lien, charge or encumbrance upon
any of the property or assets of the Company or any of its subsidiaries pursuant to the terms of (i) any indenture, mortgage,
deed of trust, loan agreement, lease, license or other agreement or instrument to which the Company or any of its subsidiaries
is a party or by which the Company or any of its subsidiaries is bound or to which any of the property or assets of the Company
is subject, which would have a material adverse effect on the business, properties, financial condition, stockholders’ equity
or results of operations of the Company (a “Material Adverse Effect”) or materially affect the validity of
the Shares or the legal authority of the Company to comply in all material respects with the terms of this Subscription Agreement;
(ii) result in any violation of the provisions of the organizational documents of the Company; or (iii) result in any violation
of any statute or any judgment, order, rule or regulation of any court or governmental agency or body, domestic or foreign, having
jurisdiction over the Company or any of its properties that would have a Material Adverse Effect or materially affect the validity
of the Shares or the legal authority of the Company to comply with this Subscription Agreement.

 

f.                 
The Company is not required to obtain any consent, waiver, authorization or order of, give any notice to, or make any filing
or registration with, any court or other federal, state, local or other governmental authority, self-regulatory organization (including
The Nasdaq Stock Market (“Nasdaq”)) or other person in connection with the execution, delivery and performance
of this Subscription Agreement (including, without limitation, the issuance of the Shares), other than (i) filings with the Securities
and Exchange Commission (the “Commission”), (ii) filings required by applicable state securities laws, (iii)
filings required by Nasdaq, including with respect to obtaining shareholder approval, (vi) filings required to consummate the
Transaction as provided under the definitive documents relating to the Transaction, and (vii) where the failure of which to obtain
would not be reasonably likely to have a Material Adverse Effect or have a material adverse effect on the Company’s ability
to consummate the transactions contemplated hereby, including the issuance and sale of the Shares.

 

g.                 
The Company has not received any written communication from a governmental entity that alleges that the Company is not
in compliance with or is in default or violation of any applicable law, except where such non-compliance, default or violation
would not be reasonably likely to have, individually or in the aggregate, a Material Adverse Effect.

 

h.                 
The issued and outstanding shares of Common Stock of the Company are registered pursuant to Section 12(b) of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”), and are listed for trading on Nasdaq under the symbol
 “VTIQ” (it being understood that the trading symbol will be changed in connection with the Transaction Closing). Except
as disclosed in the Company’s filings with the Commission, there is no suit, action, proceeding or investigation pending
or, to the knowledge of the Company, threatened against the Company by Nasdaq or the Commission, respectively, to prohibit or
terminate the listing of the Company’s Common Stock on Nasdaq or to deregister the Common Stock under the Exchange Act.
The Company has taken no action that is designed to terminate the registration of the Common Stock under the Exchange Act.

 

i.                 
Assuming the accuracy of the undersigned’s representations and warranties set forth in Section 6 of this
Subscription Agreement, no registration under the Securities Act is required for the offer and sale of the Shares by the
Company to the undersigned.

 

    5

     

    

 

j.                 
A copy of each form, report, statement, schedule, prospectus, proxy, registration statement and other document, if any,
filed by the Company with the Commission since its initial registration of the Common Stock under the Exchange Act (the “SEC
Documents”) is available to the undersigned via the Commission’s EDGAR system. None of the SEC Documents contained,
when filed or, if amended, as of the date of such amendment with respect to those disclosures that are amended, any untrue statement
of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading; provided, that with respect to the information
about the Company’s affiliates contained in the Schedule 14A and related proxy materials (or other SEC document) to be filed
by the Company the representation and warranty in this sentence is made to the Company’s knowledge. The Company has timely
filed each report, statement, schedule, prospectus, and registration statement that the Company was required to file with the
Commission since its initial registration of the Common Stock under the Exchange Act. There are no material outstanding or unresolved
comments in comment letters from the staff of the Division of Corporation Finance (the “Staff”) of the Commission
with respect to any of the SEC Documents.

 

k.                 
Except for such matters as have not had and would not be reasonably likely to have, individually or in the aggregate, a
Material Adverse Effect, there is no (i) action, suit, claim or other proceeding, in each case by or before any governmental authority
pending, or, to the knowledge of the Company, threatened against the Company or (ii) judgment, decree, injunction, ruling or order
of any governmental entity or arbitrator outstanding against the Company.

 

l.                 
Other than the Other Subscription Agreements, the Company has not entered into any side letter or similar agreement with
any Subscriber in connection with such Subscriber’s direct or indirect investment in the Company or with or any other investor,
and such Other Subscription Agreements have not been amended in any material respect following the date of this Subscription Agreement
and reflect the same Per Share Purchase Price and terms that are no more favorable to such Subscriber thereunder than the terms
of this Subscription Agreement. The Company has not agreed and will not agree to issue any warrants to any person in connection
with the Transaction.

 

6.                 
Subscriber Representations and Warranties. The undersigned represents and warrants to the Company that:

 

a.                 
The undersigned is (i) a “qualified institutional buyer” (as defined under the Securities Act) or (ii) an institutional
 “accredited investor” (within the meaning of Rule 501(a) under the Securities Act), in each case, satisfying the requirements
set forth on Schedule A, and is acquiring the Shares only for his, her or its own account and not for the account of others,
and not on behalf of any other account or person or with a view to, or for offer or sale in connection with, any distribution
thereof in violation of the Securities Act (and shall provide the requested information on Schedule A following the signature
page hereto). Accordingly, the undersigned understands that the offering of the Shares meets the exemptions from filing under
FINRA Rule 5123(b)(1)(C) or (J). The undersigned is not an entity formed for the specific purpose of acquiring the Shares.

 

    6

     

    

 

b.                 
The undersigned (i) is an institutional account as defined in FINRA Rule 4512(c), (ii) is a sophisticated investor, experienced
in investing in private equity transactions and capable of evaluating investment risks independently, both in general and with
regard to all transactions and investment strategies involving a security or securities and (iii) has exercised independent judgment
in evaluating its participation in the purchase of the Shares. Accordingly, the undersigned understands that the offering meets
(x) the exemptions from filing under FINRA Rule 5123(b)(1)(A) and (y) the institutional customer exemption under FINRA Rule 2111(b).

 

c.                 
The undersigned understands that the Shares are being offered in a transaction not involving any public offering within
the meaning of the Securities Act and that the Shares have not been registered under the Securities Act. The undersigned understands
that the Shares may not be resold, transferred, pledged or otherwise disposed of by the undersigned absent an effective registration
statement under the Securities Act except (i) to the Company or a subsidiary thereof, (ii) to non-U.S. persons pursuant to offers
and sales that occur outside the United States within the meaning of Regulation S under the Securities Act or (iii) pursuant to
another applicable exemption from the registration requirements of the Securities Act, and in each of cases (i) and (iii) in accordance
with any applicable securities laws of the states and other jurisdictions of the United States, and that any certificates or book-entry
positions representing the Shares shall contain a legend to such effect. The undersigned acknowledges that the Shares will not
be eligible for resale pursuant to Rule 144A promulgated under the Securities Act. The undersigned understands and agrees that
the Shares will be subject to the foregoing transfer restrictions and, as a result of these transfer restrictions, the undersigned
may not be able to readily resell the Shares and may be required to bear the financial risk of an investment in the Shares for
an indefinite period of time. The undersigned understands that it has been advised to consult legal counsel prior to making any
offer, resale, pledge or transfer of any of the Shares.

 

d.                  The
undersigned understands and agrees that the undersigned is purchasing Shares directly from the Company. The undersigned further
acknowledges that there have been no representations, warranties, covenants and agreements made to the undersigned by the Company,
its officers or directors, or any other party to the Transaction or person or entity, expressly or by implication, other than
those representations, warranties, covenants and agreements included in this Subscription Agreement.

 

e.                 
Either (i) the undersigned is not a Benefit Plan Investor as contemplated by the Employee Retirement Income Security Act
of 1974, as amended (“ERISA”), or (ii) the undersigned’s acquisition and holding of the Shares will not
constitute or result in a non-exempt prohibited transaction under Section 406 of ERISA, Section 4975 of the Internal Revenue Code
of 1986, as amended, or any applicable similar law.

 

f.                  
The undersigned acknowledges and agrees that the undersigned has received and has had an adequate opportunity to review,
such financial and other information as the undersigned deems necessary in order to make an investment decision with respect to
the Shares and made its own assessment and is satisfied concerning the relevant tax and other economic considerations relevant
to the undersigned’s investment in the Shares. Without limiting the generality of the foregoing, the undersigned acknowledges
that it has reviewed the documents provided to the undersigned by the Company. The undersigned represents and agrees that the
undersigned and the undersigned’s professional advisor(s), if any, have had the full opportunity to ask such questions,
receive such answers and obtain such information as the undersigned and such undersigned’s professional advisor(s), if any,
have deemed necessary to make an investment decision with respect to the Shares. The undersigned further acknowledges that the
information provided to the undersigned is preliminary and subject to change, and that any changes to such information, including,
without limitation, any changes based on updated information or changes in terms of the Transaction, shall in no way affect the
undersigned’s obligation to purchase the Shares hereunder.

 

    7

     

    

 

g.                 
The undersigned became aware of this offering of the Shares solely by means of direct contact between the undersigned and the
Company or a representative of the Company, and the Shares were offered to the undersigned solely by direct contact between the
undersigned and the Company or a representative of the Company. The undersigned did not become aware of this offering of the Shares,
nor were the Shares offered to the undersigned, by any other means. The undersigned acknowledges that the Company represents and
warrants that the Shares (i) were not offered by any form of general solicitation or general advertising and (ii) are not being
offered in a manner involving a public offering under, or in a distribution in violation of, the Securities Act, or any state
securities laws.

 

h.                 
The undersigned acknowledges that it is aware that there are substantial risks incident to the purchase and ownership of
the Shares. The undersigned is able to fend for himself, herself or itself in the transactions completed herein, has such knowledge
and experience in financial and business matters as to be capable of evaluating the merits and risks of an investment in the Shares
and has the ability to bear the economic risks of such investment in the Shares and can afford a complete loss of such investment.
The undersigned has sought such accounting, legal and tax advice as the undersigned has considered necessary to make an informed
investment decision.

 

i.            
        Alone, or together with any professional advisor(s), the undersigned has adequately analyzed
and fully considered the risks of an investment in the Shares and determined that the Shares are a suitable investment for the
undersigned and that the undersigned is able at this time and in the foreseeable future to bear the economic risk of a total loss
of the undersigned’s investment in the Company. The undersigned acknowledges specifically that a possibility of total loss
exists.

 

j.                  
In making its decision to purchase the Shares, the undersigned has relied solely upon independent investigation made by
the undersigned and the representations, warranties and covenants contained herein. Without limiting the generality of the foregoing,
the undersigned has not relied on any statements or other information provided by the Placement Agents (as defined below) concerning
the Company or the Shares or the offer and sale of the Shares.

 

k.                 
The undersigned understands and agrees that no federal or state agency has passed upon or endorsed the merits of the offering
of the Shares or made any findings or determination as to the fairness of this investment.

 

l.                  
The undersigned has been duly formed or incorporated and is validly existing in good standing under the laws of its jurisdiction
of incorporation or formation.

 

    8

     

    

 

m.               
The execution, delivery and performance by the undersigned of this Subscription Agreement are within the powers of the undersigned,
have been duly authorized and will not constitute or result in a breach or default under or conflict with any order, ruling or
regulation of any court or other tribunal or of any governmental commission or agency, or any agreement or other undertaking,
to which the undersigned is a party or by which the undersigned is bound, and, if the undersigned is not an individual, will not
violate any provisions of the undersigned’s charter documents, including, without limitation, its incorporation or formation
papers, bylaws, indenture of trust or partnership or operating agreement, as may be applicable. The signature on this Subscription
Agreement is genuine, and the signatory, if the undersigned is an individual, has legal competence and capacity to execute the
same or, if the undersigned is not an individual, the signatory has been duly authorized to execute the same, and this Subscription
Agreement constitutes a legal, valid and binding obligation of the undersigned, enforceable against the undersigned in accordance
with its terms.

 

n.                 
Neither the due diligence investigation conducted by the undersigned in connection with making its decision to acquire the Shares
nor any representations and warranties made by the undersigned herein shall modify, amend or affect the undersigned’s right
to rely on the truth, accuracy and completeness of the Company’s representations and warranties contained herein.

 

o.                 
The undersigned is not (i) a person or entity named on the List of Specially Designated Nationals and Blocked Persons administered
by the U.S. Treasury Department’s Office of Foreign Assets Control (“OFAC”) or in any Executive Order
issued by the President of the United States and administered by OFAC (“OFAC List”), or a person or entity
prohibited by any OFAC sanctions program, (ii) a Designated National as defined in the Cuban Assets Control Regulations, 31 C.F.R.
Part 515, or (iii) a non-U.S. shell bank or providing banking services indirectly to a non-U.S. shell bank (collectively, a “Prohibited
Investor”). The undersigned agrees to provide law enforcement agencies, if requested thereby, such records as required
by applicable law, provided that the undersigned is permitted to do so under applicable law. If the undersigned is a financial
institution subject to the Bank Secrecy Act (31 U.S.C. Section 5311 et seq.) (the “BSA”), as amended by the
USA PATRIOT Act of 2001 (the “PATRIOT Act”), and its implementing regulations (collectively, the “BSA/PATRIOT
Act”), the undersigned maintains policies and procedures reasonably designed to comply with applicable obligations under
the BSA/PATRIOT Act.  To the extent required, it maintains policies and procedures reasonably designed for the screening
of its investors against the OFAC sanctions programs, including the OFAC List. To the extent required, it maintains policies and
procedures reasonably designed to ensure that the funds held by the undersigned and used to purchase the Shares were legally derived.

 

p.                 
No disclosure or offering document has been prepared by Morgan Stanley & Co. LLC or Cowen and Company, LLC (collectively,
the “Placement Agents”) or any of their respective affiliates in connection with the offer and sale of the
Shares.

 

q.                 
The Placement Agents and their respective directors, officers, employees, representatives and controlling persons have
made no independent investigation with respect to the Company or the Shares or the accuracy, completeness or adequacy of any information
supplied to the undersigned by the Company.

 

    9

     

    

 

r.                   
In connection with the issue and purchase of the Shares, the Placement Agents have not acted as the undersigned’s
financial advisor or fiduciary.

 

s.                  
If the undersigned is a resident of Canada, the undersigned hereby declares, represents, warrants and agrees as set forth
in the attached Schedule B.

 

7.                 
Registration Rights.

 

a.                 
In the event that the Shares are not registered in connection with the consummation of the Transaction, the Company agrees
that, within forty-five (45) calendar days after the consummation of the Transaction (the “Filing Deadline”),
the Company will file with the Commission (at the Company’s sole cost and expense) a registration statement (the “Registration
Statement”) registering such resale, and the Company shall use its commercially reasonable efforts to have the Registration
Statement declared effective as soon as practicable after the filing thereof, but no later than the 60th calendar day
(or 120th calendar day if the Commission notifies the Company that it will “review” the Registration Statement)
following the Filing Deadline (such date, the “Effectiveness Date”); provided, however, that
the Company’s obligations to include the Shares in the Registration Statement are contingent upon the undersigned furnishing
in writing to the Company such information regarding the undersigned, the securities of the Company held by the undersigned and
the intended method of disposition of the Shares as shall be reasonably requested by the Company to effect the registration of
the Shares, and shall execute such documents in connection with such registration as the Company may reasonably request that are
customary of a selling stockholder in similar situations. The Company will use its commercially reasonable efforts to maintain
the continuous effectiveness of the Registration Statement until the earliest of (i) the date on which the Shares may be resold
without volume or manner of sale limitations pursuant to Rule 144 promulgated under the Securities Act, (ii) the date on which
such Shares have actually been sold and (iii) the date which is two years after the Subscription Closing. For purposes of clarification,
any failure by the Company to file the Registration Statement by the Filing Deadline or to effect such Registration Statement
by the Effectiveness Date shall not otherwise relieve the Company of its obligations to file or effect the Registration Statement
set forth in this Section 7.

 

    10

     

    

 

b.                 
The Company further agrees that, in the event that (i) the Registration Statement is not filed with the Commission on or
prior to the Filing Deadline, (ii) the Registration Statement has not been declared effective by the Commission by the Effectiveness
Date, (iii) after such Registration Statement is declared effective by the Commission, (A) such Registration Statement ceases
for any reason (including without limitation by reason of a stop order, or the Company’s failure to update the Registration
Statement), to remain continuously effective as to all Shares for which it is required to be effective or (B) a Subscriber is
not permitted to utilize the Registration Statement to resell its Shares (in each case of (A) and (B), (x) other than within the
time period(s) permitted by this Agreement and (y) excluding by reason of a post-effective amendment required in connection with
the Company’s filing of an amendment thereto (a “Special Grace Period”), which Special Grace Period shall
not be treated as a Registration Default (as defined below)), or (iv) after the date six months following the Transaction Closing
Date, and only in the event the Registration Statement is not effective or available to sell all of the Shares, the Company fails
to file with the Commission any required reports under Section 13 or 15(d) of the Exchange Act such that it is not in compliance
with Rule 144(c)(1) (or Rule 144(i)(2), if applicable), as a result of which the Subscribers who are not affiliates are unable
to sell their Shares without restriction under Rule 144 (or any successor thereto) (each such event referred to in clauses (i)
through (iv), a “Registration Default” and, for purposes of such clauses, the date on which such Registration
Default occurs, a “Default Date”), then in addition to any other rights such Subscriber may have hereunder
or under applicable law, on each such Default Date and on each monthly anniversary of each such Default Date (if the applicable
Registration Default shall not have been cured by such date) until the applicable Registration Default is cured, the Company shall
pay to each Subscriber an amount in cash, as partial liquidated damages and not as a penalty (“Liquidated Damages”),
equal to 0.5% of the aggregate Purchase Price paid by the Subscriber pursuant to this Subscription Agreement for any Shares held
by the Subscriber on the Default Date; provided, however, that if such Subscriber fails to provide the Company with any information
requested by the Company that is required to be provided in such Registration Statement with respect to such Subscriber as set
forth herein, then, for purposes of this Section 7, the Filing Date or Effectiveness Date, as applicable, for a Registration Statement
with respect to such Subscriber shall be extended until two (2) Business Days following the date of receipt by the Company of
such required information from such Subscriber; and in no event shall the Company be required hereunder to pay to such Subscriber
pursuant to this Subscription Agreement an aggregate amount that exceeds 5.0% of the aggregate Purchase Price paid by such Subscriber
for its Shares. The Liquidated Damages pursuant to the terms hereof shall apply on a daily pro-rata basis for any portion of a
month prior to the cure of a Registration Default, except in the case of the first Default Date. The Company shall deliver the
cash payment to such Subscriber with respect to any Liquidated Damages by the fifth Business Day after the date payable. If the
Company fails to pay said cash payment to such Subscriber in full by the fifth Business Day after the date payable, the Company
will pay interest thereon at a rate of 5.0% per annum (or such lesser maximum amount that is permitted to be paid by applicable
law, and calculated on the basis of a year consisting of 360 days) to such Subscriber, accruing daily from the date such Liquidated
Damages are due until such amounts, plus all such interest thereon, are paid in full. Notwithstanding the foregoing, nothing shall
preclude any Subscriber from pursuing or obtaining any available remedies at law, specific performance or other equitable relief
with respect to this Section 7 in accordance with applicable law. The parties agree that notwithstanding anything to the contrary
herein, no Liquidated Damages shall be payable to any Subscriber with respect to any period during which all of such Subscriber’s
Shares may be sold by such Subscriber without volume or manner of sale restrictions under Rule 144 and the Company is in compliance
with the current public information requirements under Rule 144(c)(1) (or Rule 144(i)(2), if applicable).

 

    11

     

    

 

c.                  
Notwithstanding anything to the contrary in this Subscription Agreement, the Company shall be entitled to delay or postpone
the effectiveness of the Registration Statement, and from time to time to require any Subscriber not to sell under the Registration
Statement or to suspend the effectiveness thereof, if the negotiation or consummation of a transaction by the Company or its subsidiaries
is pending or an event has occurred, which negotiation, consummation or event, the Company’s board of directors reasonably
believes, upon the advice of legal counsel, would require additional disclosure by the Company in the Registration Statement of
material information that the Company has a bona fide business purpose for keeping confidential and the non-disclosure of which
in the Registration Statement would be expected, in the reasonable determination of the Company’s board of directors, upon
the advice of legal counsel, to cause the Registration Statement to fail to comply with applicable disclosure requirements (each
such circumstance, a “Suspension Event”); provided, however, that the Company may not delay or suspend the
Registration Statement on more than two occasions or for more than sixty (60) consecutive calendar days, or more than ninety (90)
total calendar days, in each case during any twelve-month period. Upon receipt of any written notice from the Company of the happening
of any Suspension Event (which notice shall not contain material non-public information) during the period that the Registration
Statement is effective or if as a result of a Suspension Event the Registration Statement or related prospectus contains any untrue
statement of a material fact or omits to state any material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made (in the case of the prospectus) not misleading, each Subscriber
agrees that (i) it will immediately discontinue offers and sales of the Shares under the Registration Statement (excluding, for
the avoidance of doubt, sales conducted pursuant to Rule 144) until such Subscriber receives copies of a supplemental or amended
prospectus (which the Company agrees to promptly prepare) that corrects the misstatement(s) or omission(s) referred to above and
receives notice that any post-effective amendment has become effective or unless otherwise notified by the Company that it may
resume such offers and sales, and (ii) it will maintain the confidentiality of any information included in such written notice
delivered by the Company unless otherwise required by law or subpoena. If so directed by the Company, each Subscriber will deliver
to the Company or, in such Subscriber’s sole discretion destroy, all copies of the prospectus covering the Shares in such
Subscriber’s possession; provided, however, that this obligation to deliver or destroy all copies of the prospectus covering
the Shares shall not apply (i) to the extent such Subscriber is required to retain a copy of such prospectus (a) in order to comply
with applicable legal, regulatory, self-regulatory or professional requirements or (b) in accordance with a bona fide pre-existing
document retention policy or (ii) to copies stored electronically on archival servers as a result of automatic data back-up.

 

    12

     

    

 

d.                 
The Company shall, notwithstanding any termination of this Subscription Agreement, indemnify, defend and hold harmless
each Subscriber (to the extent a seller under the Registration Statement), the officers, directors and agents of each of them,
and each person who controls such Subscriber (within the meaning of Section 15 of the Securities Act or Section 20 of
the Exchange Act) to the fullest extent permitted by applicable law, from and against any and all losses, claims, damages, liabilities,
costs (including, without limitation, reasonable attorneys’ fees) and expenses (collectively, “Losses”),
as incurred, that arise out of or are based upon (i) any untrue or alleged untrue statement of a material fact contained
in the Registration Statement, any prospectus included in the Registration Statement or any form of prospectus or in any amendment
or supplement thereto or in any preliminary prospectus, or arising out of or relating to any omission or alleged omission to state
a material fact required to be stated therein or necessary to make the statements therein (in the case of any prospectus or form
of prospectus or supplement thereto, in light of the circumstances under which they were made) not misleading, or (ii) any
violation or alleged violation by the Company of the Securities Act, Exchange Act or any state securities law or any rule or regulation
thereunder, in connection with the performance of its obligations under this Section 7, except to the extent, but only to
the extent, that such untrue statements, alleged untrue statements, omissions or alleged omissions are based upon information
regarding such Subscriber furnished in writing to the Company by such Subscriber expressly for use therein or such Subscriber
has omitted a material fact from such information or otherwise violated the Securities Act, Exchange Act or any state securities
law or any rule or regulation thereunder; provided, however, that the indemnification contained in this Section 7 shall not apply
to amounts paid in settlement of any Losses if such settlement is effected without the consent of the Company (which consent shall
not be unreasonably withheld, conditioned or delayed), nor shall the Company be liable for any Losses to the extent they arise
out of or are based upon a violation which occurs (A) in reliance upon and in conformity with written information furnished by
a Subscriber, (B) in connection with any failure of such person to deliver or cause to be delivered a prospectus made available
by the Company in a timely manner, (C) as a result of offers or sales effected by or on behalf of any person by means of a freewriting
prospectus (as defined in Rule 405) that was not authorized in writing by the Company, or (D) in connection with any offers or
sales effected by or on behalf of a Subscriber in violation of Section 7(c) hereof. The Company shall notify such Subscriber promptly
of the institution, threat or assertion of any proceeding arising from or in connection with the transactions contemplated by
this Section 7 of which the Company is aware. Such indemnity shall remain in full force and effect regardless of any investigation
made by or on behalf of an indemnified party and shall survive the transfer of the Shares by such Subscriber.

 

e.                  
Each Subscriber shall, severally and not jointly, indemnify and hold harmless the Company, its directors, officers, agents
and employees, and each person who controls the Company (within the meaning of Section 15 of the Securities Act and Section 20
of the Exchange Act), to the fullest extent permitted by applicable law, from and against all Losses, as incurred, arising out
of or are based upon any untrue or alleged untrue statement of a material fact contained in any Registration Statement, any prospectus
included in the Registration Statement, or any form of prospectus, or in any amendment or supplement thereto or in any preliminary
prospectus, or arising out of or relating to any omission or alleged omission of a material fact required to be stated therein
or necessary to make the statements therein (in the case of any prospectus, or any form of prospectus or supplement thereto, in
light of the circumstances under which they were made) not misleading to the extent, but only to the extent, that such untrue
statements or omissions are based upon information regarding such Subscriber furnished in writing to the Company by such Subscriber
expressly for use therein; provided, however, that the indemnification contained in this Section 7 shall not apply to amounts
paid in settlement of any Losses if such settlement is effected without the consent of such Subscriber (which consent shall not
be unreasonably withheld, conditioned or delayed). In no event shall the liability of any Subscriber be greater in amount than
the dollar amount of the net proceeds received by such Subscriber upon the sale of the Shares giving rise to such indemnification
obligation. Each Subscriber shall notify the Company promptly of the institution, threat or assertion of any proceeding arising
from or in connection with the transactions contemplated by this Section 7 of which such Subscriber is aware. Such indemnity
shall remain in full force and effect regardless of any investigation made by or on behalf of an indemnified party and shall survive
the transfer of the Shares by such Subscriber.

 

    13

     

    

 

8.                 
Termination. This Subscription Agreement shall terminate and be void and of no further force and effect, and all
rights and obligations of the parties hereunder shall terminate without any further liability on the part of any party in respect
thereof, upon the earliest to occur of (a) such time as the Company notifies the undersigned in writing, or publicly discloses,
that it does not intend to consummate the Transaction, (b) following the execution of a definitive agreement among the Company
and Nikola with respect to the Transaction (a “Transaction Agreement”), such date and time as such Transaction
Agreement is terminated in accordance with its terms without the Transaction being consummated, (c) upon the mutual written
agreement of each of the parties hereto to terminate this Subscription Agreement, (d) if any of the conditions to the Subscription
Closing set forth in Section 3 of this Subscription Agreement are not satisfied or waived on or prior to the Subscription
Closing and, as a result thereof, the transactions contemplated by this Subscription Agreement are not consummated at the Subscription
Closing, (e) if the consummation of the Transaction shall not have occurred by the earlier of (x) the 10th business day after
the anticipated Transaction Closing Date specified in the Closing Notice, or (y) July 31, 2020 or (h) if following the execution
of the Transaction Agreement and prior to the consummation of the Transaction, the aggregate amount of valid and enforceable subscriptions
by the Subscribers (including any such amounts that have been actually funded) is less than $500.0 million; provided
that nothing herein will relieve any party from liability for any willful breach hereof prior to the time of termination, and
each party will be entitled to any remedies at law or in equity to recover losses, liabilities or damages arising from such breach.
The Company shall promptly notify the undersigned of the termination of the Transaction Agreement after the termination of such
agreement.

 

9.                 
Trust Account Waiver. The undersigned acknowledges that the Company is a blank check company with the powers and
privileges to effect a merger, asset acquisition, reorganization or similar business combination involving the Company and one
or more businesses or assets. The undersigned further acknowledges that, as described in the Company’s prospectus relating
to its initial public offering dated May 15, 2018 (the “Prospectus”) available at www.sec.gov, substantially
all of the Company’s assets consist of the cash proceeds of the Company’s initial public offering and private placements
of its securities, and substantially all of those proceeds have been deposited in a trust account (the “Trust Account”)
for the benefit of the Company, its public stockholders and the underwriters of the Company’s initial public offering. For
and in consideration of the Company entering into this Subscription Agreement, the receipt and sufficiency of which are hereby
acknowledged, the undersigned hereby irrevocably waives any and all right, title and interest, or any claim of any kind it has
or may have in the future, in or to any monies held in the Trust Account, and agrees not to seek recourse against the Trust Account,
in each case, as a result of, or arising out of, this Subscription Agreement; provided that nothing in this Section
9 shall be deemed to limit the undersigned’s right, title, interest or claim to the Trust Account by virtue of the undersigned’s
record or beneficial ownership of Common Stock of the Company acquired by any means other than pursuant to this Subscription Agreement.

 

10.               
Miscellaneous.

 

a.                  
The Company shall, no later than 9:00 a.m., New York City time, on the first (1st) business day immediately following the
date of this Subscription Agreement, issue one or more press releases or file with the Commission a Current Report on Form 8-K
(collectively, the “Disclosure Document”) disclosing all material terms of the transactions contemplated hereby,
the Transaction and any other material, nonpublic information that the Company has provided to the undersigned at any time prior
to the filing of the Disclosure Document. From and after the issuance of the Disclosure Document, the undersigned shall not be
in possession of any material, non-public information received from the Company or any of its officers, directors or employees.
Notwithstanding anything in this Subscription Agreement to the contrary, each party hereto acknowledges and agrees that without
the prior written consent of the other party hereto it will not publicly make reference to such other party or any of its affiliates
(i) in connection with the Transaction or this Subscription Agreement (provided that the undersigned may disclose its entry into
this Subscription Agreement and the Purchase Price) or (ii) in any promotional materials, media, or similar circumstances, except,
in each case, as required by law or regulation or at the request of the Staff of the Commission or regulatory agency or under
the regulations of Nasdaq, including, in the case of the Company (a) as required by the federal securities law in connection with
the Registration Statement, (b) the filing of this Subscription Agreement (or a form of this Subscription Agreement) with the
Commission and (c) the filing of the Registration Statement on Form S-4 and Schedule 14A and related materials to be filed by
the Company with respect to the Transaction.

 

    14

     

    

 

b.                  Neither
this Subscription Agreement nor any rights that may accrue to the undersigned hereunder (other than the Shares acquired hereunder,
if any) may be transferred or assigned.

 

c.                 
The Company may request from the undersigned such additional information as the Company may deem necessary to evaluate
the eligibility of the undersigned to acquire the Shares, and the undersigned shall provide such information as may reasonably
be requested, to the extent readily available and to the extent consistent with its internal policies and procedures.

 

d.                
The undersigned acknowledges that the Company and the Placement Agents (pursuant to the ultimate sentence of this paragraph)
and Nikola will rely on the acknowledgments, understandings, agreements, representations and warranties contained in this Subscription
Agreement. Prior to the Subscription Closing, the undersigned agrees to promptly notify the Company if any of the acknowledgments,
understandings, agreements, representations and warranties set forth herein are no longer accurate. The undersigned agrees that
each purchase by the undersigned of Shares from the Company will constitute a reaffirmation of the acknowledgments, understandings,
agreements, representations and warranties herein (as modified by any such notice) by the undersigned as of the time of such purchase.
The undersigned further acknowledges and agrees that the Placement Agents are third-party beneficiaries of the representations
and warranties of the undersigned contained in Sections 6(a), 6(b), 6(c), 6(f), 6(h), 6(p), 6(q) and 6(r) of this Subscription
Agreement.

 

e.                 
The Company is entitled to rely upon this Subscription Agreement and is irrevocably authorized to produce this Subscription
Agreement or a copy hereof when required by law, regulatory authority or Nasdaq to do so in any administrative or legal proceeding
or official inquiry with respect to the matters covered hereby.

 

f.                  
Except if required by law or Nasdaq, without the prior written consent of the undersigned, the Company shall not, and shall
cause its representatives, including the Placement Agents and their respective representatives, not to, disclose the existence
of this Subscription Agreement or any negotiations related hereto, or to use the name of the undersigned or any information provided
by the undersigned in connection herewith in or for the purpose of any marketing activities or materials or for any similar or
related purpose.

 

g.                 
All the agreements, representations and warranties made by each party hereto in this Subscription Agreement shall survive
the Subscription Closing.

 

    15

     

    

 

h.                 
This Subscription Agreement may not be modified, waived or terminated except by an instrument in writing, signed by the
party against whom enforcement of such modification, waiver, or termination is sought.

 

i.                 
This Subscription Agreement constitutes the entire agreement, and supersedes all other prior agreements, understandings,
representations and warranties, both written and oral, among the parties, with respect to the subject matter hereof. Except as
otherwise expressly set forth in subsection (d) of this Section 11, this Subscription Agreement shall not confer any rights or
remedies upon any person other than the parties hereto, and their respective successor and assigns.

 

j.                  
Except as otherwise provided herein, this Subscription Agreement shall be binding upon, and inure to the benefit of the
parties hereto and their heirs, executors, administrators, successors, legal representatives, and permitted assigns, and the agreements,
representations, warranties, covenants and acknowledgments contained herein shall be deemed to be made by, and be binding upon,
such heirs, executors, administrators, successors, legal representatives and permitted assigns.

 

k.                  
If any provision of this Subscription Agreement shall be invalid, illegal or unenforceable, the validity, legality or enforceability
of the remaining provisions of this Agreement shall not in any way be affected or impaired thereby and shall continue in full
force and effect.

 

l.                  
This Subscription Agreement may be executed in one or more counterparts (including by facsimile or electronic mail or in
..pdf) and by different parties in separate counterparts, with the same effect as if all parties hereto had signed the same document.
All counterparts so executed and delivered shall be construed together and shall constitute one and the same agreement.

 

m.               
The parties hereto agree that irreparable damage would occur in the event that any of the provisions of this Subscription
Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that
the parties shall be entitled to an injunction or injunctions to prevent breaches of this Subscription Agreement and to enforce
specifically the terms and provisions of this Subscription Agreement, this being in addition to any other remedy to which such
party is entitled at law, in equity, in contract, in tort or otherwise.

 

n.                 
THIS SUBSCRIPTION AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK,
WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF LAWS THAT WOULD OTHERWISE REQUIRE THE APPLICATION OF THE LAW OF ANY OTHER STATE.
EACH PARTY HERETO HEREBY WAIVES ANY RIGHT TO A JURY TRIAL IN CONNECTION WITH ANY LITIGATION PURSUANT TO THIS SUBSCRIPTION AGREEMENT
AND THE TRANSACTIONS CONTEMPLATED HEREBY. 

 

[SIGNATURE
PAGES FOLLOW]

 

    16

     

    

 

IN
WITNESS WHEREOF, the undersigned has executed or caused this Subscription Agreement to be executed by its duly authorized
representative as of the date set forth below.

 

	Name of
    Investor:	 	State/Country
    of Formation or Domicile:

 

	 	 	 
	By: 	 	 	 
	 	 	 	 
	Name:		 	 
	 	 	 	 
	Title: 		 	 

 

	Name in
    which shares are to be registered (if different):	 	Date:
                                         _______________, 2020 
	 	 	 
	Investor’s EIN:	 	 
	 	 	 
	Business Address-Street:	 	Mailing
                                         Address-Street (if different):
	 	 	 
	City, State, Zip:	 	City,
                                         State, Zip:
	 	 	 
	Attn:__________________	 	Attn:__________________
	 	 	 
	Telephone No.:	 	Telephone
                                         No.:
	 	 	 
	Facsimile No.:	 	Facsimile
                                         No.:
	 	 	 
	Number of Shares subscribed
    for:	 	 
	 	 	 
	Aggregate Subscription
    Amount: $	 	Price
                                         Per Share: $10.00

 

You
must pay the Subscription Amount by wire transfer of United States dollars in immediately available funds to the account specified
by the Company in the Closing Notice. To the extent the offering is oversubscribed, the number of Shares received may be less
than the number of Shares subscribed for.

 

    17

     

    

 

IN
WITNESS WHEREOF, VectoIQ Acquisition Corp. has accepted this Subscription Agreement as of the date set forth below.

 

 

	 	VECTOIQ
    ACQUISITION CORP.
	 	 
	 	By:	                   
	 	 
	 	Name:	     
	 	 
	 	Title:	 
	 	 
	Date:
    ____________, 2020	 

 

    18

     

    

 

 

SCHEDULE A

ELIGIBILITY REPRESENTATIONS OF THE INVESTOR

 

A.           QUALIFIED
INSTITUTIONAL BUYER STATUS

(Please check the applicable
subparagraphs):

 

		1.	 ̈          We are a “qualified institutional
                                                                buyer” (as defined in Rule 144A under the Securities Act).

 

B.            INSTITUTIONAL
ACCREDITED INVESTOR STATUS

(Please check the applicable
subparagraphs):

 

		1.	 ̈          We are an “accredited investor”
                                                                (within the meaning of Rule 501(a) under the Securities Act. for one or more of the following reasons (Please check the
                                                                applicable subparagraphs):

 

		 ̈	We
are a bank, as defined in Section 3(a)(2) of the Securities Act or any savings and loan association or other institution as defined
in Section 3(a)(5)(A) of the Securities Act, whether acting in an individual or a fiduciary capacity.
	 	 	 
	 	 ̈	We
are a broker or dealer registered under Section 15 of the Securities Exchange Act of 1934, as amended.
	 	 	 
	 	 ̈	We
are an insurance company, as defined in Section 2(13) of the Securities Act.
	 	 	 
	 	 ̈	We
are an investment company registered under the Investment Company Act of 1940 or a business development company, as defined in
Section 2(a)(48) of that act.
	 	 	 
	 	 ̈	We
are 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.
	 	 	 
	 	 ̈	We
are 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 the plan has total assets in excess of $5 million.
	 	 	 
	 	 ̈	We are an employee benefit plan within the meaning of Title
I of the Employee Retirement Income Security Act of 1974, if the investment decision is being made by a plan fiduciary, as defined
in Section 3(21) of such act, and the plan fiduciary is either a bank, an insurance company, or a registered investment adviser,
or if the employee benefit plan has total assets in excess of $5 million.
	 	 	 
	 	 ̈	We
are a private business development company, as defined in Section 202(a)(22) of the Investment Advisers Act of 1940.
	 	 	 
	 	 ̈	We
are a corporation, Massachusetts or similar business trust, or partnership, or an organization described in Section 501(c)(3)
of the Internal Revenue Code of 1986, as amended, that was not formed for the specific purpose of acquiring the Securities,
and that has total assets in excess of $5 million.

 

Schedule A

 

     

     

    

 

		 ̈	We
are a trust with total assets in excess of $5 million not formed for the specific purpose of acquiring the Securities, whose purchase
is directed by a sophisticated person as described in Rule 506(b)(2)(ii) under the Securities Act.
	 	 	 
	 	 ̈	We
are an entity in which all of the equity owners are accredited investors.

 

C.           AFFILIATE
STATUS

 

(Please check the applicable
box)

 

THE INVESTOR:

 

 ̈       is:

 

 ̈       is
not:

 

   an “affiliate” (as
defined in Rule 144 under the Securities Act) of the Company or acting on behalf of an affiliate of the Company.

 

This page should
be completed by the Investor and constitutes a part of the Subscription Agreement

 

Schedule A

 

     

     

    

 

SCHEDULE B

ELIGIBILITY REPRESENTATIONS OF THE INVESTOR
(Canadian Investors Only)

 

		1.	We
                                         hereby declare, represent and warrant that:

 

		(a)	we
                                         are purchasing the Shares as principal for our own account, or are deemed to be purchasing
                                         the Shares as principal for our own account in accordance with applicable Canadian securities
                                         laws, and not as agent for the benefit of another investor;
	 	 	 

		(b)	we are residents in or subject to the laws of one of the provinces or territories of Canada;
	 	 	 

		(c)	we are entitled under applicable securities laws to purchase the Shares without the benefit of
a prospectus qualified under such securities laws and, without limiting the generality of the foregoing, are both:
	 	 	 

		a.	an “accredited investor” as defined in section 1.1 of National Instrument 45-106 Prospectus
Exemptions (“NI 45-106”) or section 73.3(2) of the Securities Act (Ontario) by virtue of satisfying the
indicated criterion in Section 11 below, and we are not a person created or used solely to purchase or hold securities as an “accredited
investor” as described in paragraph (m) of the definition of "accredited investor" in section 1.1 of NI 45-106;
and
	 	 	 

		b.	a “permitted client” as defined in section 1.1 of National Instrument 31-103 Registration
Requirements, Exemptions and Ongoing Registrant Obligations (“NI 31-103”) by virtue of satisfying the indicated
criterion in Section 12 below
	 	 	 

		(d)	we have received, reviewed and understood, this Subscription Agreement and certain disclosure materials
relating to the placing of Shares in Canada and, are basing our investment decision solely on this Subscription and the materials
provided by the Company and not on any other information concerning the Company or the offering of the Shares;
	 	 	 

		(e)	the acquisition of Shares does not and will not contravene any applicable Canadian securities laws,
rules or policies of the jurisdiction in which we are resident and does not trigger (i) any obligation to prepare and file a prospectus
or similar document or (ii) any registration or other similar obligation on the part of any person;
	 	 	 

		(f)	we will execute and deliver within the applicable time periods all documentation as may be required
by applicable Canadian securities laws to permit the purchase of the Shares on the terms set forth herein and, if required by applicable
Canadian securities laws, will execute, deliver and file or assist the Company in obtaining and filing such reports, undertakings
and other documents relating to the purchase of the Shares as may be required by any applicable Canadian securities laws, securities
regulator, stock exchange or other regulatory authority; and
	 	 	 

		(g)	neither we nor any party on whose behalf we are acting has been established, formed or incorporated
solely to acquire or permit the purchase of Shares without a prospectus in reliance on an exemption from the prospectus requirements
of applicable Canadian securities laws.

 

Schedule B

 

     

     

    

 

		2.	We are aware of the characteristics of the Shares, the risks relating to an investment therein
and agree that we must bear the economic risk of its investment in the Shares. We understand that we will not be able to resell
the Shares under applicable Canadian securities laws except in accordance with limited exemptions and compliance with other requirements
of applicable law, and we (and not the Company) are responsible for compliance with applicable resale restrictions or hold periods
and will comply with all relevant Canadian securities laws in connection with any resale of the Shares.
	 	 	 

		3.	We hereby undertake to notify the Company immediately of any change to any declaration, representation,
warranty or other information relating to us set forth herein which takes place prior to the closing of the purchase of the Shares
applied for hereby.
	 	 	 

		4.	We understand and acknowledge that (i) the Company is not a reporting issuer in any province or
territory in Canada and its securities are not listed on any stock exchange in Canada and there is currently no public market for
the Shares in Canada; and (ii) the Company currently has no intention of becoming a reporting issuer in Canada and the Company
is not obligated to file and has no present intention of filing a prospectus with any securities regulatory authority in Canada
to qualify the resale of the Shares to the public, or listing the Company’s securities on any stock exchange in Canada and
thus the applicable restricted period or hold period may not commence and the Shares may be subject to an unlimited hold period
or restricted period in Canada and in that case may only be sold pursuant to limited exemptions under applicable securities legislation.
	 	 	 

		5.	We confirm we have reviewed applicable resale restrictions under relevant Canadian legislation
and regulations.
	 	 	 

		6.	It is acknowledged that we should consult our own legal and tax advisors with respect to the tax
consequences of an investment in the Shares in our particular circumstances and with respect to the eligibility of the Shares for
investment by us and resale restrictions under relevant Canadian legislation and regulations, and that we have not relied on the
Company or on the contents of the disclosure materials provided by the Company, for any legal, tax or financial advice.
	 	 	 

		7.	If we are a resident of Quebec, we acknowledge that it is our express wish that all documents evidencing
or relating in any way to the sale of the Shares be drawn in the English language only. Si nous sommes résidents de la
province de Québec, nous reconnaissons par les présentes que c’est notre volonté expresse que tous les
documents faisant foi ou se rapportant de quelque manière à la vente des engagements soient rédigés
en anglais seulement.
	 	 	 

		8.	We understand and acknowledge that we are making the representations, warranties and agreements
contained herein with the intent that they may be relied upon by the Company and the agents in determining our eligibility to purchase
the Shares, including the availability of exemptions from the prospectus requirements of applicable Canadian securities laws in
connection with the issuance of the Shares.
	 	 	 

		9.	We consent to the collection, use and disclosure of certain personal information for the purposes
of meeting legal, regulatory, self-regulatory, security and audit requirements (including any applicable tax, securities, money
laundering or anti-terrorism legislation, rules or regulations) and as otherwise permitted or required by law, which disclosures
may include disclosures to tax, securities or other regulatory or self-regulatory authorities in Canada and/or in foreign jurisdictions,
if applicable, in connection with the regulatory oversight mandate of such authorities.
	 	 	 

		10.	If we are an individual resident in Canada, we acknowledge that: (A) the Company or the agents
may be required to provide personal information pertaining to us as required to be disclosed in Schedule I of Form 45-106F1
Report of Exempt Distribution (“Form 45-106F1”) under NI 45-106 (including its name, email address, address, telephone
number and the aggregate purchase price paid by the purchaser) (“personal information”) to the securities regulatory
authority or regulator in the local jurisdiction (the “Regulator”); (B) the personal information is being collected
indirectly by the Regulator under the authority granted to it in securities legislation; and (C) the personal information is being
collected for the purposes of the administration and enforcement of the securities legislation; and by purchasing the securities,
we shall be deemed to have authorized such indirect collection of personal information by the Regulator. Questions about the indirect
collection of information should be directed to the Regulator in the local jurisdiction, using the contact information set out
below:

 

Schedule B

 

     

     

    

 

		(a)	in Alberta, the Alberta Securities Commission, Suite 600, 250 - 5th Street SW, Calgary, Alberta
T2P 0R4, Telephone: (403) 297-6454, toll free in Canada: 1-877-355-0585;
	 	 	 

		(b)	in British Columbia, the British Columbia Securities Commission, P.O. Box 10142, Pacific Centre,
701 West Georgia Street, Vancouver, British Columbia V7Y 1L2, Inquiries: (604) 899-6581, toll free in Canada: 1-800-373-6393, Email:
inquiries@bcsc.bc.ca;
	 	 	 

		(c)	in Manitoba, The Manitoba Securities Commission, 500 - 400 St. Mary Avenue, Winnipeg, Manitoba
R3C 4K5, Telephone: (204) 945-2548, toll free in Manitoba 1-800-655-5244;
	 	 	 

		(d)	in New Brunswick, Financial and Consumer Services Commission (New Brunswick), 85 Charlotte Street,
Suite 300, Saint John, New Brunswick E2L 2J2, Telephone: (506) 658-3060, toll free in Canada: 1-866-933-2222, Email: info@fcnb.ca;
	 	 	 

		(e)	in Newfoundland and Labrador, Government of Newfoundland and Labrador, Financial Services Regulation
Division, P.O. Box 8700, Confederation Building, 2nd Floor, West Block, Prince Philip Drive, St. John’s, Newfoundland and
Labrador, A1B 4J6, Attention: Director of Securities, Telephone: (709) 729-4189,
	 	 	 

		(f)	in the Northwest Territories, the Government of the Northwest Territories, Office of the Superintendent
of Securities, P.O. Box 1320, Yellowknife, Northwest Territories X1A 2L9, Attention: Deputy Superintendent, Legal & Enforcement,
Telephone: (867) 920-8984;
	 	 	 

		(g)	in Nova Scotia, the Nova Scotia Securities Commission, Suite 400, 5251 Duke Street, Duke Tower,
P.O. Box 458, Halifax, Nova Scotia B3J 2P8, Telephone: (902) 424-7768;
	 	 	 

		(h)	in Nunavut, Government of Nunavut, Department of Justice, Legal Registries Division, P.O. Box 1000,
Station 570, 1st Floor, Brown Building, Iqaluit, Nunavut X0A 0H0, Telephone: (867) 975-6590;
	 	 	 

		(i)	in Ontario, the Inquiries Officer at the Ontario Securities Commission, 20 Queen Street West, 22nd
Floor, Toronto, Ontario M5H 3S8, Telephone: (416) 593-8314, toll free in Canada: 1-877-785-1555, Email: exemptmarketfilings@osc.gov.on.ca;
	 	 	 

		(j)	in Prince Edward Island, the Prince Edward Island Securities Office, 95 Rochford Street, 4th Floor
Shaw Building, P.O. Box 2000, Charlottetown, Prince Edward Island C1A 7N8, Telephone: (902) 368-4569;
	 	 	 

		(k)	in
                                         Québec, the Autorité des marchés financiers, 800, Square Victoria,
                                         22e étage, C.P. 246, Tour de la Bourse, Montréal, Québec H4Z 1G3,
                                         Telephone: (514) 395-0337 or 1-877-525-0337, Email:financementdessocietes@lautorite.qc.ca
                                         (For corporate finance issuers), fonds_dinvestissement@lautorite.qc.ca (For investment
                                         fund issuers);

 

Schedule B

 

     

     

    

 

		(l)	in Saskatchewan, the Financial and Consumer Affairs Authority of Saskatchewan, Suite 601 - 1919
Saskatchewan Drive, Regina, Saskatchewan S4P 4H2, Telephone: (306) 787-5879; and
	 	 	 

		(m)	in Yukon, Government of Yukon, Department of Community Services, Law Centre, 3rd Floor, 2130 Second
Avenue, Whitehorse, Yukon Y1A 5H6, Telephone: (867) 667-5314.

 

		11.	We hereby represent, warrant, covenant and certify that we are,
or any party on whose behalf we are acting is, an “accredited investor” as defined in NI 45-106 or section 73.3(1)
of the Securities Act (Ontario) by virtue of satisfying the indicated criterion below:

 

Please check the category that applies:

 

	 ̈	 	 	a
    Canadian financial institution or a Schedule III bank of the Bank Act (Canada),
	 ̈	 	 	the
    Business Development Bank of Canada incorporated under the Business Development Bank of Canada Act (Canada),
	 ̈	 	 	a
    subsidiary of any person or company referred to in paragraphs (a) or (b) if the person or company owns all of the voting securities
    of the subsidiary, except the voting securities required by law to be owned by directors of that subsidiary,
	 ̈	 	 	a
    person or company registered under the securities legislation of a province or territory of Canada as an adviser or dealer,
    except as otherwise prescribed by the regulations,
	 	 	 	[omitted]
	 	 	(e.1)	[omitted]
	 ̈	 	 	the
    Government of Canada, the government of a province or territory of Canada, or any Crown corporation, agency or wholly owned
    entity of the Government of Canada or of the government of a province or territory of Canada,
	 ̈	 	 	a
    municipality, public board or commission in Canada and a metropolitan community, school board, the Comité de gestion
    de la taxe scolaire de l’île de Montréal or an intermunicipal management board in Québec,
	 ̈	 	 	any
    national, federal, state, provincial, territorial or municipal government of or in any foreign jurisdiction, or any agency
    of that government,
	 ̈	 	(i)	a
    pension fund that is regulated by either the Office of the Superintendent of Financial Institutions (Canada) or a pension
    commission or similar regulatory authority of a province or territory of Canada,
	 	 	 	[omitted]
	 ̈	 	(j.1)	an
    individual who beneficially owns financial assets having an aggregate realizable value that before taxes, but net of any related
    liabilities, exceeds CAD$5,000,000,
	 	 	 	[omitted]
	 	 	 	[omitted]
	 ̈	 	 	a
    person, other than an individual or investment fund, that has net assets of at least $5,000,000 as shown on its most recently
    prepared financial statements,

 

Schedule B

 

     

     

    

 

	 ̈	 	 	an
    investment fund that distributes or has distributed its securities only to
	 	 	 	a
    person that is or was an accredited investor at the time of the distribution,
	 	 	 	a
    person that acquires or acquired securities in the circumstances referred to in sections 2.10 of NI 45-106 [Minimum
    amount investment], or 2.19 of NI 45-106 [Additional investment in investment funds], or
	 	 	 	a
    person described in paragraph (i) or (ii) that acquires or acquired securities under section 2.18 of NI 45-106 [Investment
    fund reinvestment],
	 ̈	 	 	an
    investment fund that distributes or has distributed securities under a prospectus in a jurisdiction of Canada for which the
    regulator or, in Québec, the securities regulatory authority, has issued a receipt,
	 ̈	 	 	a
    trust company or trust corporation registered or authorized to carry on business under the Trust and Loan Companies Act
    (Canada) or under comparable legislation in a jurisdiction of Canada or a foreign jurisdiction, acting on behalf of a
    fully managed account managed by the trust company or trust corporation, as the case may be,
	 ̈	 	 	a
    person acting on behalf of a fully managed account1 managed by that person, if that person is registered or authorized
    to carry on business as an adviser or the equivalent under the securities legislation of a jurisdiction of Canada or a foreign
    jurisdiction,
	 ̈	 	 	a
    registered charity under the Income Tax Act (Canada) that, in regard to the trade, has obtained advice from an eligibility
    adviser or an adviser registered under the securities legislation of the jurisdiction of the registered charity to give advice
    on the securities being traded,
	 ̈	 	 	an
    entity organized in a foreign jurisdiction that is analogous to any of the entities referred to in paragraphs (a) through
    (d) or paragraph (i) in form and function,
	 ̈	 	 	a
    person in respect of which all of the owners of interests, direct, indirect or beneficial, except the voting securities required
    by law to be owned by directors, are persons that are accredited investors,
	 ̈	 	 	an
    investment fund that is advised by a person registered as an adviser or a person that is exempt from registration as an adviser,
	 ̈	 	 	a
    person that is recognized or designated by the Commission as an accredited investor,
	 ̈	 	 	a
    trust established by an accredited investor for the benefit of the accredited investor’s family members of which a majority
    of the trustees are accredited investors and all of the beneficiaries are the accredited investor’s spouse, a former
    spouse of the accredited investor or a parent, grandparent, brother, sister, child or grandchild of that accredited investor,
    of that accredited investor’s spouse or of that accredited investor’s former spouse.

 

		12.	We
                                         hereby represent, warrant, covenant and certify that we are, or any party on whose behalf
                                         we are acting is, a “permitted client” by virtue of the criterion indicated
                                         below,

Please check the category that applies:

 

	 ̈	(a)	a
    Canadian financial institution or a Schedule III bank;
	 ̈	(b)	the
    Business Development Bank of Canada incorporated under the Business Development Bank of Canada Act (Canada);

 

 

1       A
 “fully managed account” means an account of a client for which a person makes the investment decisions if that
person has full discretion to trade in securities for the account without requiring the client’s express consent to a transaction.

 

Schedule B

 

     

     

    

 

	 ̈	(c)	a
    subsidiary of any person or company referred to in paragraph (a) or (b), if the person or company owns all of the voting securities
    of the subsidiary, except the voting securities required by law to be owned by directors of the subsidiary;
	 ̈	(d)	a
    person or company registered under the securities legislation of a jurisdiction of Canada as an adviser, investment dealer,
    mutual fund dealer or exempt market dealer;
	 ̈	(e)	a
    pension fund that is regulated by either the Office of the Superintendent of Financial Institutions or a pension commission
    or similar regulatory authority of a jurisdiction of Canada or a wholly-owned subsidiary of such a pension fund;
	 ̈	(f)	an
    entity organized in a foreign jurisdiction that is analogous to any of the entities referred to in paragraphs (a) through
    (e);
	 ̈	(g)	the
    Government of Canada or a jurisdiction of Canada, or any Crown corporation, agency or wholly-owned entity of the Government
    of Canada or a jurisdiction of Canada;
	 ̈	(h)	any
    national, federal, state, provincial, territorial or municipal government of or in any foreign jurisdiction, or any agency
    of that government;
	 ̈	(i)	a
    municipality, public board or commission in Canada and a metropolitan community, school board, the Comité de gestion
    de la taxe scolaire de l’île de Montréal or an intermunicipal management board in Quebec;
	 ̈	(j)	a
    trust company or trust corporation registered or authorized to carry on business under the Trust and Loan Companies Act (Canada)
    or under comparable legislation in a jurisdiction of Canada or a foreign jurisdiction, acting on behalf of a managed account
    managed by the trust company or trust corporation, as the case may be;
	 ̈	(k)	a
    person or company acting on behalf of a managed account managed by person or company, if the person or company is registered
    or authorized to carry on business as an adviser or the equivalent under the securities legislation of a jurisdiction of Canada
    or a foreign jurisdiction;
	 ̈	(l)	an
        investment fund if one or both of the following apply:

         

        (i)
        the fund is managed by a person or company registered as an investment fund manager under the securities legislation of
        a jurisdiction of Canada;

         

        (ii)
        the fund is advised by a person or company authorized to act as an adviser under the securities legislation of a jurisdiction
        of Canada;

         

	 ̈	(m)	in
    respect of a dealer, a registered charity under the Income Tax Act (Canada) that obtains advice on the securities to
    be traded from an eligibility adviser or an adviser registered under the securities legislation of the jurisdiction of the
    registered charity;
	 ̈	(n)	in
    respect of an adviser, a registered charity under the Income Tax Act (Canada) that is advised by an eligibility adviser or
    an adviser registered under the securities legislation of the jurisdiction of the registered charity;
	 ̈	(o)	a
    registered charity under the Income Tax Act (Canada) that obtains advice on the securities to be traded from an eligibility
    adviser or an adviser registered under the securities legislation of the jurisdiction of the registered charity;

 

Schedule B

 

     

     

    

 

	 ̈	(p)	an
    individual who beneficially owns financial assets having an aggregate realizable value that, before taxes but net of any related
    liabilities, exceeds $5 million;
	 ̈	(q)	a
    person or company that is entirely owned by an individual or individuals referred to in paragraph (o), who holds the beneficial
    ownership interest in the person or company directly or through a trust, the trustee of which is a trust company or trust
    corporation registered or authorized to carry on business under the Trust and Loan Companies Act (Canada) or under
    comparable legislation in a jurisdiction of Canada or a foreign jurisdiction;
	 ̈	(r)	a
    person or company, other than an individual or an investment fund, that has net assets of at least C$25,000,000 as shown on
    its most recently prepared financial statements; or
	 ̈	(s)	a
    person or company that distributes securities of its own issue in Canada only to persons or companies referred to in paragraphs
    (a) through (r).

 

Schedule BEXHIBIT 4.5

 

DESCRIPTION OF THE REGISTRANT’S
SECURITIES

REGISTERED PURSUANT TO SECTION 12 OF
THE SECURITIES

EXCHANGE ACT OF 1934

 

As of December 31,
2019, Horizon Technology Finance Corporation had the following two classes of securities registered under Section 12 of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”): (i) its common stock, $0.001 par value per share (“common
stock”), and (ii) its 6.25% Notes due 2022.

 

DESCRIPTION OF COMMON STOCK

 

The following is a
description of some of the terms of our common stock, our amended and restated certificate of incorporation (the “certificate
of incorporation”), our amended and restated bylaws (the “bylaws”) and certain provisions of the Delaware General
Corporation Law (the “DGCL”). The following description is not complete and is subject to, and qualified in its entirety
by reference to, our charter and bylaws, each of which is filed or incorporated by reference as an exhibit to our Annual Report
on Form 10-K of which this Exhibit is a part, and the DGCL. You should read our charter and bylaws and the applicable provisions
of the DGCL for a complete statement of the provisions described under this caption “Description of Common Stock” and
for other provisions that may be important to you.

 

Under the terms of
our certificate of incorporation, our authorized common stock consists solely of 100,000,000 shares, par value $0.001 per share.
Our common stock is traded on Nasdaq under the symbol “HRZN”. There are no outstanding options or warrants to purchase
our stock. No stock has been authorized for issuance under any equity compensation plans. Under the DGCL, our stockholders generally
are not personally liable for our debts or obligations.

 

Under the terms of
our certificate of incorporation, all shares of our common stock have equal rights as to earnings, assets, distributions and voting.
When they are issued, shares of our common stock will be duly authorized, validly issued, fully paid and non-assessable. Distributions
may be paid to the holders of our common stock if, as and when declared by our Board out of assets legally available therefor,
subject to any preferential dividend rights of outstanding preferred stock. Holders of common stock are entitled to one vote for
each share held on all matters submitted to a vote of stockholders, including the election of directors, and do not have cumulative
voting rights. Accordingly, holders of a majority of the shares of common stock entitled to vote in any election of directors may
elect all of the directors standing for election. Upon our liquidation, dissolution or winding up, the holders of common stock
are entitled to receive ratably our net assets available after the payment of all debts and other liabilities and subject to the
prior rights of any outstanding preferred stock. Holders of common stock have no preemptive, subscription, redemption or conversion
rights. The rights, preferences and privileges of holders of common stock are subject to the rights of the holders of any series
of preferred stock which we may designate and issue in the future. In addition, holders of our common stock may participate in
our DRIP.

 

Anti-takeover effects of provisions
of our certificate of incorporation, bylaws, the DGCL and other arrangements.

 

Certain provisions
of our certificate of incorporation and bylaws, applicable provisions of the DGCL and certain other agreements to which we are
a party may make it more difficult for or prevent an unsolicited third party from acquiring control of us or changing our Board
and management. These provisions may have the effect of deterring hostile takeovers or delaying changes in our control or in our
management. These provisions are intended to enhance the likelihood of continued stability in the composition of our Board and
in the policies furnished by them and to discourage certain types of transactions that may involve an actual or threatened change
in our control. The provisions also are intended to discourage certain tactics that may be used in proxy fights. These provisions,
however, could have the effect of discouraging others from making tender offers for our shares and, as a consequence, they also
may inhibit fluctuations in the market price of our shares that could result from actual or rumored takeover attempts.

 

Election
of directors. Our certificate of incorporation and bylaws provide that the affirmative vote of a plurality of all votes
cast at a meeting of stockholders duly called at which a quorum is present shall be sufficient to elect a director. Under our certificate
of incorporation, our Board may amend the bylaws to alter the vote required to elect directors.

 

    

     

    

 

Classified
board of directors. The classification of our Board and the limitations on removal of directors and filling of vacancies
could have the effect of making it more difficult for a third party to acquire us, or of discouraging a third party from acquiring
us. Our Board is divided into three classes, with the term of one class expiring at each annual meeting of stockholders. At each
annual meeting, one class of directors is elected to a three-year term. This provision could delay for up to two years the replacement
of a majority of our Board.

 

Number
of directors; vacancies; removal. Our certificate of incorporation provides that, by amendment to our bylaws, our Board
is authorized to change the number of directors without the consent of stockholders to any number between three and nine.

 

Our certificate of
incorporation provides that, subject to the rights of any holders of preferred stock, any vacancy on our Board, however the vacancy
occurs, including a vacancy due to an enlargement of our Board, may only be filled by vote of a majority of the directors then
in office.

 

Subject to the rights
of any holders of preferred stock, a director may be removed at any time at a meeting called for that purpose, but only for cause
and only by the affirmative vote of the holders of at least 75% of the shares then entitled to vote for the election of the respective
director.

 

The limitations on
the ability of our stockholders to remove directors and fill vacancies could make it more difficult for a third party to acquire,
or discourage a third party from seeking to acquire, control of us.

 

Action
by stockholders. Under our certificate of incorporation and bylaws, stockholder action can only be taken at an annual
meeting or special meeting and not by written action in lieu of a meeting. This may have the effect of delaying consideration of
a stockholder proposal until the next annual meeting.

 

Advance
notice requirements for stockholder proposals and director nominations. Our bylaws provide that with respect to an annual
meeting of stockholders, nominations of persons for election to our Board and the proposal of business to be considered by stockholders
may be made only (1) by or at the direction of our Board, (2) pursuant to our notice of meeting or (3) by a stockholder who is
entitled to vote at the meeting and who has complied with the advance notice procedures of the bylaws. Nominations of persons for
election to our Board at a special meeting may be made only (1) by or at the direction of our Board, or (2) provided that our Board
has determined that directors will be elected at the meeting, by a stockholder who is entitled to vote at the meeting and who has
complied with the advance notice provisions of the bylaws. The purpose of requiring stockholders to give us advance notice of nominations
and other business is to afford our Board a meaningful opportunity to consider the qualifications of the proposed nominees and
the advisability of any other proposed business and, to the extent deemed necessary or desirable by our Board, to inform our stockholders
and make recommendations about such qualifications or business, as well as to provide a more orderly procedure for conducting meetings
of stockholders. Although our bylaws do not give our Board any power to disapprove stockholder nominations for the election of
directors or proposals recommending certain action, they may have the effect of precluding a contest for the election of directors
or the consideration of stockholder proposals if proper procedures are not followed and of discouraging or deterring a third party
from conducting a solicitation of proxies to elect its own slate of directors or to approve its own proposal without regard to
whether consideration of such nominees or proposals might be harmful or beneficial to us and our stockholders.

 

Amendments
to certificate of incorporation and bylaws. The DGCL provides generally that the affirmative vote of a majority of the
shares entitled to vote on any matter is required to amend a corporation’s certificate of incorporation or bylaws, unless
a corporation’s certificate of incorporation or bylaws requires a greater percentage. Our certificate of incorporation provides
that the affirmative vote of 75% of the then outstanding shares entitled to vote generally in the election of directors voting
together as a single class is required to amend provisions of our certificate of incorporation relating to the classification,
size and vacancies of our Board, as well as the removal of directors. However, if 66 2/3% of the continuing directors have approved
such amendment or repeal, the affirmative vote for such amendment or repeal shall be a majority of such shares. The affirmative
vote of 75% of the then outstanding shares voting together as a single class is required to amend provisions of our certificate
of incorporation relating to the calling of a special meeting of stockholders or the ability to amend or repeal the bylaws. Our
certificate of incorporation permits our Board to amend or repeal our bylaws, provided that any amendment or repeal shall require
the approval of at least 66 2/3% of the continuing directors. The stockholders do not have the right to adopt or repeal the bylaws.

 

Stockholder
meetings. Our certificate of incorporation and bylaws provide that any action required or permitted to be taken by stockholders
at an annual meeting may only be taken if it is properly brought before such meeting. For business to be properly brought before
an annual meeting by a stockholder, the stockholder must provide timely notice to our Secretary. Notice is timely if it is delivered
by a nationally recognized courier service or mailed by first class United States mail and received not earlier than 90 days nor
more than 120 days in advance of the anniversary of the date our proxy statement was released to stockholders in connection with
the previous year’s annual meeting. Action taken at a special meeting of stockholders is limited to the purposes stated in
the properly provided notice of meeting. These provisions could have the effect of delaying until the next stockholder meeting
actions that are favored by the holders of a majority of our outstanding voting securities.

 

    

     

    

 

Calling
of special meetings by stockholders. Our certificate of incorporation and bylaws provide that special meetings of the
stockholders may only be called by our Board, Chairman, Chief Executive Officer or President.

 

Section
203 of the DGCL. We are subject to the provisions of Section 203 of the DGCL. In general, these provisions prohibit
a Delaware corporation from engaging in any business combination with any interested stockholder for a period of three years following
the date that the stockholder became an interested stockholder, unless:

 

		•	prior to such time, the board of directors approved either
the business combination or the transaction which resulted in the stockholder becoming an interested stockholder;

 

		•	upon consummation of the transaction that resulted in
the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the voting stock of the corporation
outstanding at the time the transaction commenced; or

 

		•	on or after the date the business combination is approved by the board of directors and authorized
at a meeting of stockholders, by at least two-thirds of the outstanding voting stock that is not owned by the interested stockholder.

 

Section 203 defines
 “business combination” to include the following:

 

		•	any merger or consolidation involving the corporation
and the interested stockholder;

 

		•	any sale, transfer, pledge or other disposition (in one
transaction or a series of transactions) of 10% or more of either the aggregate market value of all the assets of the corporation
or the aggregate market value of all the outstanding stock of the corporation involving the interested stockholder;

 

		•	subject to certain exceptions, any transaction that results
in the issuance or transfer by the corporation of any stock of the corporation to the interested stockholder;

 

		•	any transaction involving the corporation that has the
effect of increasing the proportionate share of the stock of any class or series of the corporation owned by the interested stockholder;
or

 

		•	the receipt by the interested stockholder of the benefit
of any loans, advances, guarantees, pledges or other financial benefits provided by or through the corporation.

 

In general, Section
203 defines an interested stockholder as any entity or person beneficially owning 15% or more of the outstanding voting stock of
the corporation and any entity or person affiliated with or controlling or controlled by any of these entities or persons.

 

The statute could
prohibit or delay mergers or other takeover or change in control attempts and, accordingly, may discourage attempts to acquire
us.

 

Conflict
with 1940 Act. Our bylaws provide that, if and to the extent that any provision of the DGCL or our bylaws conflict with
any provision of the 1940 Act, the applicable provision of the 1940 Act will control.

 

Approval
of certain transactions. To convert us to an open-end investment company, to merge or consolidate us with any entity
in a transaction as a result of which the governing documents of the surviving entity do not contain substantially the same anti-takeover
provisions as are provided in our certificate of incorporation, to liquidate and dissolve us, or to amend any of the anti-takeover
provisions discussed herein, our certificate of incorporation requires the affirmative vote of a majority of our continuing directors
followed by the favorable vote of the holders of at least 75% of each affected class or series of our shares, voting separately
as a class or series, unless such amendment has been approved by the holders of at least 80% of the then outstanding shares of
our capital stock, voting together as a single class. If approved in the foregoing manner, our conversion to an open-end investment
company could not occur until 90 days after the stockholders meeting at which such conversion was approved and would also require
at least 30 days’ prior notice to all stockholders. As part of any such conversion to an open-end investment company, substantially
all of our investment policies and strategies and portfolio would have to be modified to assure the degree of portfolio liquidity
required for open-end investment companies. In the event of conversion, the common shares would cease to be listed on any national
securities exchange or market system. Stockholders of an open-end investment company may require the company to redeem their shares
at any time, except in certain circumstances as authorized by or under the 1940 Act, at their net asset value, less such redemption
charge, if any, as might be in effect at the time of a redemption. You should assume that it is not likely that our Board would
vote to convert us to an open-end fund.

 

    

     

    

 

The 1940 Act defines
 “a majority of the outstanding voting securities” as the lesser of a majority of the outstanding shares and 67% of
a quorum of a majority of the outstanding shares. For the purposes of calculating “a majority of the outstanding voting securities”
under our certificate of incorporation, each class and series of our shares vote together as a single class, except to the extent
required by the 1940 Act or our certificate of incorporation, with respect to any class or series of shares. If a separate class
vote is required, the applicable proportion of shares of the class or series, voting as a separate class or series, also will be
required.

 

Our Board has determined
that provisions with respect to our Board and the stockholder voting requirements described above, which voting requirements are
greater than the minimum requirements under the DGCL or the 1940 Act, are in the best interest of stockholders generally.

 

Limitations of liability and indemnification

 

The indemnification
of our officers and directors is governed by Section 145 of the DGCL, and our certificate of incorporation and bylaws. Subsection
(a) of Section 145 of the DGCL empowers a corporation to indemnify any person who was or is a party or is threatened to be made
a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative
(other than an action by or in the right of the corporation) by reason of the fact that the person is or was a director, officer,
employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or
agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys’
fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by the person in connection with such action,
suit or proceeding if (1) such person acted in good faith, (2) in a manner such person reasonably believed to be in or not opposed
to the best interests of the corporation and (3) with respect to any criminal action or proceeding, such person had no reasonable
cause to believe the person’s conduct was unlawful.

 

Subsection (b) of Section
145 of the DGCL empowers a corporation to indemnify any person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason
of the fact that the person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request
of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other
enterprise against expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection with
the defense or settlement of such action or suit if such person acted in good faith and in a manner the person reasonably believed
to be in, or not opposed to, the best interests of the corporation, and except that no indemnification may be made in respect of
any claim, issue or matter as to which such person has been adjudged to be liable to the corporation unless and only to the extent
that the Delaware Court of Chancery or the court in which such action or suit was brought determines upon application that, despite
the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses which the Delaware Court of Chancery or such other court deems proper.

 

Section 145 of the DGCL
further provides that to the extent that a present or former director or officer is successful, on the merits or otherwise, in
the defense of any action, suit or proceeding referred to in subsections (a) and (b) of Section 145 of the DGCL, or in defense
of any claim, issue or matter therein, such person will be indemnified against expenses (including attorneys’ fees) actually
and reasonably incurred by such person in connection with such action, suit or proceeding. In all cases in which indemnification
is permitted under subsections (a) and (b) of Section 145 of the DGCL (unless ordered by a court), it will be made by the corporation
only as authorized in the specific case upon a determination that indemnification of the present or former director, officer, employee
or agent is proper in the circumstances because the applicable standard of conduct has been met by the party to be indemnified.
Such determination must be made, with respect to a person who is a director or officer at the time of such determination, (1) by
a majority vote of the directors who are not parties to such action, suit or proceeding, even though less than a quorum, (2) by
a committee of such directors designated by majority vote of such directors, even though less than a quorum, (3) if there are no
such directors, or if such directors so direct, by independent legal counsel in a written opinion or (4) by the stockholders. The
statute authorizes the corporation to pay expenses incurred by an officer or director in advance of the final disposition of a
proceeding upon receipt of an undertaking by or on behalf of the person to whom the advance will be made, to repay the advances
if it is ultimately determined that he or she was not entitled to indemnification. Section 145 of the DGCL also provides that indemnification
and advancement of expenses permitted under such Section are not to be exclusive of any other rights to which those seeking indemnification
or advancement of expenses may be entitled under any bylaw, agreement, vote of stockholders or disinterested directors, or otherwise.
Section 145 of the DGCL also authorizes the corporation to purchase and maintain liability insurance on behalf of its directors,
officers, employees and agents regardless of whether the corporation would have the statutory power to indemnify such persons against
the liabilities insured.

 

    

     

    

 

Our certificate of incorporation
provides that our directors will not be liable to us or our stockholders for monetary damages for breach of fiduciary duty as a
director to the fullest extent permitted by the DGCL. Section 102(b)(7) of the DGCL provides that the personal liability of a director
to a corporation or its stockholders for breach of fiduciary duty as a director may be eliminated except for liability (1) for
any breach of the director’s duty of loyalty to the corporation or its stockholders, (2) for acts or omissions not in good
faith or which involve intentional misconduct or a knowing violation of law, (3) under Section 174 of the DGCL, relating to unlawful
payment of distributions or unlawful stock purchases or redemption of stock or (4) for any transaction from which the director
derives an improper personal benefit.

 

Under our certificate
of incorporation, we fully indemnify any person who was or is involved in any actual or threatened action, suit or proceeding by
reason of the fact that such person is or was one of our directors or officers. So long as we are regulated under the 1940 Act,
the above indemnification and limitation of liability is limited by the 1940 Act or by any valid rule, regulation or order of the
SEC thereunder. The 1940 Act provides, among other things, that a company may not indemnify any director or officer against liability
to it or its security holders to which he or she might otherwise be subject by reason of his or her willful misfeasance, bad faith,
gross negligence or reckless disregard of the duties involved in the conduct of his or her office unless a determination is made
by final decision of a court, by vote of a majority of a quorum of directors who are disinterested, non-party directors or by independent
legal counsel that the liability for which indemnification is sought did not arise out of the foregoing conduct.

 

We have obtained liability
insurance for our directors and officers. In addition, we have entered into indemnification agreements with each of our directors
and officers in order to effect the foregoing except to the extent that such indemnification would exceed the limitations on indemnification
under Section 17(h) of the 1940 Act.

 

    

     

    

 

DESCRIPTION OF NOTES

 

Our 6.25% Notes due
2022 (the “notes”) were issued under an indenture dated as of March 23, 2012 (the “base indenture”), as
amended and supplemented by a second supplemental indenture dated as of September 27, 2017 (the “supplemental indenture;”
the base indenture, as amended and supplemented by the supplemental indenture, is hereinafter called the “indenture”),
each between us and U.S. Bank National Association, as trustee.

 

We may issue our debt
securities under the indenture from time to time in one or more series. The notes are a separate series of our debt securities
issued and outstanding under the indenture, which means that, for purposes of giving any consent, notice or waiver or taking any
other action under the indenture, the registered holders of the notes will act separately from the registered holders of each other
series of our debt securities that may be outstanding under the indenture from time to time. Unless otherwise expressly stated
or the context otherwise requires, references to “debt securities” under this caption “Description of Notes”
and the caption “Description of Indenture” below shall include the notes.

 

The description of some
of the terms of the notes and the indenture contained under this caption “Description of Notes” are not complete and
are subject to, and qualified in their entirety by reference to, the indenture and the form of the notes, which are incorporated
by reference as exhibits to the Annual Report on Form 10-K of which this Exhibit is a part. You should read the indenture and the
form of the notes for a complete statement of the provisions described under this caption “Description of Notes” and
other provisions that may be important to you.

 

General

 

The Notes:

 

		•	were issued in an initial principal amount of $37,375,000;

 

		•	will mature on September 15, 2022, unless redeemed prior
to maturity;

 

		•	were issued in denominations of $25 and integral multiples
of $25 in excess thereof;

 

		•	are redeemable in whole or in part at any time or from
time to time on and after September 15, 2019, at a redemption price of $25 per Note plus accrued and unpaid interest payments
otherwise payable for the then-current quarterly interest period accrued to the date fixed for redemption as described under “—
Redemption and Repayment” below;

 

		•	are listed on NYSE under the symbol “HTFA”.

 

The Notes are our direct
unsecured obligations and rank:

 

		•	pari passu with current and future unsecured unsubordinated
indebtedness;

 

		•	senior to any of our future indebtedness that expressly
provides it is subordinated to the Notes;

 

		•	effectively subordinated to all of our existing and future
secured indebtedness (including indebtedness that is initially unsecured to which we subsequently grant security), to the extent
of the value of the assets securing such indebtedness; and

 

		•	structurally subordinated to all existing and future
indebtedness and other obligations of any of our subsidiaries, financing vehicles or similar facilities, including without limitation
amounts outstanding under our revolving credit facility with KeyBank National Association (the “Key Facility”).

 

Our subsidiaries are
separate and distinct legal entities and have no obligation, contingent or otherwise, to pay any amounts due on the Notes or to
make any funds available for payment on the Notes, whether by dividends, loans or other payments. In addition, the payment of dividends
and the making of loans and advances to us by our subsidiaries may be subject to statutory, contractual or other restrictions,
may depend on the earnings or financial condition of all of the foregoing and are subject to various business considerations. As
a result, we may be unable to gain significant, if any, access to the cash flow or assets of our subsidiaries.

 

The Indenture does not
limit the amount of debt (secured and unsecured) that we and our subsidiaries may incur or our ability to pay dividends, sell assets,
enter into transactions with affiliates or make investments. In addition, the Indenture does not contain any provisions that would
necessarily protect holders of Notes if we become involved in a highly leveraged transaction, reorganization, merger or other similar
transaction that adversely affects us or them.

 

    

     

    

 

The Notes are issuable
in fully registered form only, without coupons, in minimum denominations of $25 and integral multiples thereof. The Notes are represented
by one or more global notes deposited with or on behalf of DTC, or a nominee thereof. Except as otherwise provided in the Indenture,
the Notes are registered in the name of that depositary or its nominee. We will make payments on a global security in accordance
with the applicable policies of the depositary as in effect from time to time. Under those policies, we will make payments directly
to the depositary, or its nominee, and not to any indirect holders who own beneficial interests in the global security. An indirect
holder’s right to those payments will be governed by the rules and practices of the depositary and its participants.

 

We are permitted, under
specified conditions, to issue multiple classes of indebtedness if our asset coverage, as defined in the 1940 Act, is at least
equal to 200% immediately after each such issuance. In addition, while any indebtedness and senior securities remain outstanding,
we must make provisions to prohibit the distribution to our stockholders or the repurchase of such securities or shares unless
we meet the applicable asset coverage ratios at the time of the distribution or repurchase. Specifically, we may be precluded from
declaring dividends or repurchasing shares of our common stock unless our asset coverage is at least 200%. We may also borrow amounts
up to 5% of the value of our total assets for temporary or emergency purposes without regard to asset coverage.

 

Interest Provisions Related to the Notes

 

Interest on the Notes
accrues at the rate of 6.25% per annum and is payable quarterly on each March 15, June 15, September 15, and December 15. The 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 date, as the case may be. We will pay interest to those persons who were holders of record of such Notes on the
first day of the month during which each interest payment date occurs: each March 1, June 1, September 1 and December 1, commencing
December 1, 2017.

 

Interest on the Notes
accrues from the date of original issuance and is computed on the basis of a 360-day year comprised of twelve 30-day months. The
notes are not entitled to the benefit of any sinking fund.

 

Interest payments
are made only on a business day, defined in the Indenture as each Monday, Tuesday, Wednesday, Thursday and Friday that is not a
day on which banking institutions in New York City and Chicago are authorized or required by law or executive order to close. If
any interest payment is due on a non-business day, we will make the payment on the next day that is a business day. Payments made
on the next business day in this situation will be treated under the Indenture as if they were made on the original due date. Such
payment will not result in a default under the Notes or the Indenture, and no interest will accrue on the payment amount from the
original due date to the next day that is a business day.

 

Redemption and Repayment

 

The Notes may be redeemed
in whole or in part at any time or from time to time at our option on or after September 15, 2019, upon not less than 30 days nor
more than 60 days written notice by mail prior to the date fixed for redemption thereof, at a redemption price of $25 per Note
plus accrued and unpaid interest payments otherwise payable for the then-current quarterly interest period accrued to the date
fixed for redemption.

 

Holders may be prevented
from exchanging or transferring the Notes when they are subject to redemption. In case any Notes are to be redeemed in part only,
the redemption notice will provide that, upon surrender of such Note, a holder will receive, without a charge, a new Note or Notes
of authorized denominations representing the principal amount of a holder’s remaining unredeemed Notes.

 

Any exercise of our
option to redeem the Notes will be done in compliance with the 1940 Act, to the extent applicable.

 

If we redeem only a
portion of the Notes, the Trustee will determine the method for selection of the particular Notes to be redeemed in compliance
with the requirements of the NYSE (or such other principal national securities exchange on which the Notes are then listed), or,
if the Notes are not then listed on any national securities exchange, on a pro rata basis, by lot, or by such method as the trustee
deems fair and appropriate, in accordance with the 1940 Act to the extent applicable and in accordance with any applicable depositary
procedures. Unless we default in payment of the redemption price, on and after the date of redemption, interest will cease to accrue
on the Notes called for redemption.

 

    

     

    

 

Holders do not have
the option to have the Notes repaid prior to the stated maturity date.

 

Trading Characteristics

 

We expect the Notes
to trade at a price that takes into account the value, if any, of accrued and unpaid interest. This means that purchasers will
not pay, and sellers will not receive, accrued and unpaid interest on the Notes that is not included in their trading price. Any
portion of the trading price of a Note that is attributable to accrued and unpaid interest will be treated as a payment of interest
for U.S. federal income tax purposes and will not be treated as part of the amount realized for purposes of determining gain or
loss on the disposition of the Notes.

 

Certain Covenants

 

In addition to standard
covenants relating to payment of principal and interest, maintaining an office where payments may be made or securities surrendered
for payment, payment of taxes and related matters, the following covenants apply to the Notes.

 

Reporting

 

We have agreed to provide
to holders of the Notes and the trustee (if at any time when Notes are outstanding we are not subject to the reporting requirements
of Sections 13 or 15(d) of the Exchange Act to file any periodic reports with the SEC), our audited annual consolidated financial
statements, within 90 days of our fiscal year end, and unaudited interim consolidated financial statements, within 45 days of our
fiscal quarter end (other than our fourth fiscal quarter). All such financial statements will be prepared, in all material respects,
in accordance with applicable United States generally accepted accounting principles.

 

940 Act Compliance

 

We have agreed that,
for the period of time during which the Notes are outstanding, we will not violate Section 18(a)(1)(A) as modified by Section 61(a)(1)
of the 1940 Act or any successor provisions.

 

We have agreed that,
for the period of time during which the Notes are outstanding, we will not violate Section 18(a)(1)(B) as modified by (i) Section
61(a)(1) of the 1940 Act, the definitional provisions of the 1940 Act or any successor provisions and after giving effect to any
exemptive relief granted to us by the SEC and (ii) the two other exceptions set forth below. These statutory provisions of the
1940 Act are not currently applicable to us and will not be applicable to us as a result of this offering. However, if Section
18(a)(1)(B) as modified by Section 61(a)(1) of the 1940 Act were currently applicable to us in connection with this offering, these
provisions would generally prohibit us from declaring any cash dividend or distribution upon any class of our capital stock, or
purchasing any such capital stock if our asset coverage, as defined for purposes of Section 18(a)(1)(B) in the 1940 Act, were below
200% at the time of the declaration of the dividend or distribution or purchase and after deducting the amount of such dividend,
distribution, or purchase. Under the covenant, we will be permitted to declare a cash dividend or distribution notwithstanding
the prohibition contained in Section 18(a)(1)(B) as modified by Section 61(a)(1) of the 1940 Act, but only up to such amount as
is necessary for us to maintain our status as a regulated investment company under Subchapter M of the Internal Revenue Code of
1986. Furthermore, the covenant will not be triggered unless and until such time as our asset coverage has not been in compliance
with the minimum asset coverage required by Section 18(a)(1)(B) as modified by Section 61(a)(1) of the 1940 Act (after giving effect
to any exemptive relief granted to us by the SEC) for more than six consecutive months.

 

Events of Default

 

A holder will have rights
if an Event of Default occurs in respect of the Notes and is not cured, as described later in this subsection.

 

The term “Event
of Default” in respect of the Notes means any of the following:

 

		•	We do not pay the principal of, or any premium on, the
Notes when due, whether at maturity, upon redemption or otherwise.

 

		•	We do not pay interest on the Notes when due, and such
default is not cured within 30 days.

 

		•	We remain in breach of a covenant in respect of the Notes
for 60 days after we receive a written notice of default stating we are in breach. The notice must be sent by either the trustee,
if such default is known to a responsible officer of the trustee or a responsible officer of the trustee has received written
notice of such default, or holders of at least 25% of the principal amount of the Notes.

 

    

     

    

 

		•	The acceleration of our or our subsidiaries’ indebtedness
for money borrowed in aggregate principal amount of $10 million or more so that it becomes due and payable before the date on
which it would otherwise have become due and payable, if such acceleration is not rescinded within 30 days after we receive a
written notice of default stating we are in breach. The notice must be sent by either the trustee or holders of at least 25% of
the principal amount of the Notes.

 

	 	•	We or any of our subsidiaries fail, within 30 days, to pay, bond or otherwise discharge any final, non-appealable judgments or orders for the payment of money the total uninsured amount of which for us or any of our subsidiaries exceeds $10 million, which are not stayed on appeal.

 

		•	We or any of our subsidiaries that is a “significant
subsidiary” (as defined in Regulation S-X under the Exchange Act) or any group of our subsidiaries that in the aggregate
would constitute a “significant subsidiary” file for bankruptcy, or certain other events of bankruptcy, insolvency
or reorganization occur and in the case of certain orders or decrees entered against us under bankruptcy law, such order or decree
remains undischarged or unstayed for a period of 60 days.

 

		•	On the last business day of each of twenty-four consecutive
calendar months, we have an asset coverage of less than 100%.

 

The trustee may withhold
notice to the holders of the Notes any default, except in the payment of principal, premium or interest, if it considers the withholding
of notice to be in the best interests of the holders.

 

Remedies if an Event of Default Occurs

 

If an Event of Default,
other than an Event of Default referred to in the second to last bullet point above with respect to us (but including an Event
of Default referred to in that bullet point solely with respect to a significant subsidiary, or group of subsidiaries that in the
aggregate would constitute a significant subsidiary of ours), has occurred and has not been cured, the trustee, if such event of
default is known to a responsible officer of the trustee or a responsible officer of the trustee has received written notice of
such event of default, or the holders of at least 25% in principal amount of Notes may declare the entire principal amount of all
the Notes to be due and immediately payable. If an Event of Default referred to in the second to last bullet point above with respect
to us (and not solely with respect to a significant subsidiary, or group of subsidiaries that in the aggregate would constitute
a significant subsidiary of ours) has occurred, the entire principal amount of all the Notes will automatically become due and
immediately payable. This is called a declaration of acceleration of maturity. In certain circumstances, a declaration of acceleration
of maturity may be canceled by the holders of a majority in principal amount of the Notes.

 

The trustee is not
required to take any action under the Indenture at the request of any holders unless the holders offer the trustee reasonable protection
from expenses and liability (called an “indemnity”) (Section 315 of the Trust Indenture Act of 1939). If reasonable
indemnity is provided, the holders of a majority in principal amount of the Notes may direct the time, method and place of conducting
any lawsuit or other formal legal action seeking any remedy available to the trustee. The trustee may refuse to follow those directions
in certain circumstances. No delay or omission in exercising any right or remedy will be treated as a waiver of that right, remedy
or Event of Default.

 

Before a holder is
allowed to bypass the trustee and bring their own lawsuit or other formal legal action or take other steps to enforce their rights
or protect their interests relating to the Notes, the following must occur:

 

		•	A holder must give the trustee written notice that an
Event of Default has occurred and remains uncured.

 

		•	The holders of at least 25% in principal amount of all
outstanding Notes must make a written request that the trustee take action because of the default and must offer reasonable indemnity
to the trustee against the cost and other liabilities of taking that action.

 

		•	The trustee must not have taken action for 60 calendar
days after receipt of the above notice and offer of indemnity.

 

    

     

    

 

		•	The holders of a majority in principal amount of the
Notes must not have given the trustee a direction inconsistent with the above notice during that 60 calendar day period.

 

However, a holder
is entitled at any time to bring a lawsuit for the payment of money due on Notes on or after the due date.

 

Holders of a majority
in principal amount of the Notes may waive any past defaults other than:

 

		•	the payment of principal, any premium or interest; or

 

		•	in respect of a covenant that cannot be modified or amended
without the consent of each holder.

 

Each year, we will
furnish to the trustee a written statement of certain of our officers certifying that to their knowledge we are in compliance with
the Indenture, or else specifying any default.

 

Merger or Consolidation

 

Under the terms of
the Indenture, we are generally permitted to consolidate or merge with another entity. We are also permitted to sell all or substantially
all of our assets to another entity. However, we may not consolidate with or into any other corporation or convey or transfer all
or substantially all of our property or assets to any person unless all the following conditions are met:

 

		•	Where we merge out of existence or sell our assets, the
resulting entity must agree to be legally responsible for all of our obligations under the Notes and the Indenture.

 

		•	Immediately after giving effect to such transaction,
no Default or Event of Default shall have happened and be continuing.

 

		•	We must deliver certain certificates and documents to
the trustee.

 

Modification or Waiver

 

There are three types
of changes we can make to the Indenture and the Notes.

 

Changes Requiring Approval of Holders

 

First, there are changes
that we cannot make to the Notes without the specific approval of the holders. The following is a list of those types of changes:

 

		•	change the stated maturity of the principal of or interest
on the Notes;

 

		•	reduce any amounts due on the Notes;

 

		•	reduce the amount of principal payable upon acceleration
of the maturity of the Notes following a default;

 

		•	adversely affect any right of repayment at the holder’s
option;

 

		•	change the place (except as otherwise described in the
accompanying prospectus or prospectus supplement) or currency of payment on the Notes;

 

		•	impair a holder’s right to sue for payment;

 

		•	reduce the percentage of holders of Notes whose consent
is needed to modify or amend the Indenture;

 

		•	reduce the percentage of holders of Notes whose consent
is needed to waive compliance with certain provisions of the Indenture or to waive certain defaults;

 

		•	modify any other aspect of the provisions of the Indenture
dealing with supplemental indentures, modification and waiver of past defaults, changes to the quorum or voting requirements or
the waiver of certain covenants; and

 

		•	change any obligation we have to pay additional amounts.

 

    

     

    

 

Changes Not Requiring Approval

 

The second type of
change does not require any vote by the holders of the Notes. This type is limited to clarifications and certain other changes
that would not adversely affect holders of the Notes in any material respect. We also do not need any approval to make any change
that affects only debt securities to be issued under the indenture after the change takes effect.

 

Changes Requiring Majority Approval

 

Any other change to
the Indenture and the Notes would require the following approval:

 

		•	If the change affects only the Notes, it must be approved
by the holders of a majority in principal amount of the Notes outstanding at such time.

 

		•	If the change affects more than one series of debt securities
issued under the indenture, it must be approved by the holders of a majority in principal amount of all of the series affected
by the change, with all affected series voting together as one class for this purpose.

 

The holders of a majority
in principal amount of all of the series of debt securities issued under an indenture, voting together as one class for this purpose,
may waive our compliance with some of our covenants in that indenture. However, we cannot obtain a waiver of a payment default
or of any of the matters covered by the bullet points included above under “— Changes Requiring Approval of Holders.

”

Defeasance

 

Covenant Defeasance

 

Under current United
States federal tax law, we can make the deposit described below and be released from some of the restrictive covenants in the Indenture
under which the Notes were issued. This is called “covenant defeasance.” In that event, a holder would lose the protection
of those restrictive covenants but would gain the protection of having money and government securities set aside in trust to repay
a holder’s Notes. In order to achieve covenant defeasance, we must do the following:

 

		•	We must irrevocably deposit in trust for the benefit
of all holders of such Notes a combination of money and United States government or United States government agency notes or bonds
that will generate enough cash to make interest, principal and any other payments on the Notes on their various due dates. No
Default or Event of Default with respect to the Notes shall have occurred and be continuing on the date of such deposit, or in
the case of a bankruptcy Event of Default, at any time during the period ending on the 91st day after the date of such deposit.

 

		•	We must deliver to the trustee a legal opinion of our
counsel confirming that, under current U.S. federal income tax law, we may make the above deposit without causing holders to be
taxed on the Notes any differently than if we did not make the deposit and just repaid the Notes ourselves at maturity.

 

We must deliver to
the trustee a legal opinion of our counsel stating that the above deposit does not require registration by us under the 1940 Act
and a legal opinion and officers’ certificate stating that all conditions precedent to covenant defeasance have been complied
with.

 

If we accomplish covenant
defeasance, a holder can still look to us for repayment of the Notes if there were a shortfall in the trust deposit or the trustee
is prevented from making payment. For example, if one of the remaining Events of Default occurred (such as our bankruptcy) and
the Notes became immediately due and payable, there might be a shortfall. Depending on the event causing the default, a holder
may not be able to obtain payment of the shortfall.

 

Full Defeasance

 

If there is a change
in U.S. federal tax law, as described below, we can legally release ourselves from all payment and other obligations on the Notes
(called “full defeasance”) if we put in place the following other arrangements for a holder to be repaid:

 

		•	We must deposit in trust for the benefit of all holders
of such Notes a combination of money and United States government or United States government agency notes or bonds that will
generate enough cash to make interest, principal and any other payments on the Notes and for payment of amounts due to the trustee.
No Default or Event of Default with respect to the Notes shall have occurred and be continuing on the date of such deposit, or
in the case of a bankruptcy Event of Default, at any time during the period ending on the 91st day after the date of such deposit.

 

    

     

    

 

		•	We must deliver to the trustee a legal opinion confirming
that there has been a change in current U.S. federal tax law or a ruling issued by the Internal Revenue Service, or IRS, that
allows us to make the above deposit without causing holders to be taxed on the Notes any differently than if we did not make the
deposit and just repaid the Notes ourselves at maturity. Under current U.S. federal tax law, the deposit and our legal release
from the Notes would be treated as though we paid holders their share of the cash and notes or bonds at the time the cash and
notes or bonds were deposited in trust in exchange for their Notes and holders would recognize gain or loss on the Notes at the
time of the deposit.

 

		•	We must deliver to the trustee a legal opinion of our
counsel stating that the above deposit does not require registration by us under the 1940 Act and a legal opinion and officers’
certificate stating that all conditions precedent to defeasance have been complied with.

 

If we ever did accomplish
full defeasance, as described above, holders would have to rely solely on the trust deposit for repayment of the Notes. Holders
could not look to us for repayment in the unlikely event of any shortfall. Conversely, the trust deposit would most likely be protected
from claims of our lenders and other creditors if we ever became bankrupt or insolvent.

 

No service charge will
be made for any registration of transfer or any exchange of Notes, but we may require payment of a sum sufficient to cover any
transfer tax or similar governmental charge payable in connection therewith.

 

Satisfaction and Discharge

 

The Indenture will
be discharged and will cease to be of further effect with respect to the Notes when either:

 

		•	all the Notes that have been authenticated have been
delivered to the trustee for cancellation; or

 

		•	all the Notes that have not been delivered to the trustee
for cancellation:

 

		•	have become due and payable,

 

		•	will become due and payable at their stated maturity
within one year, or

 

		•	are to be called for redemption within one year, and
we, in the case of the first, second and third sub-bullets above, have irrevocably deposited or caused to be deposited with the
trustee as trust funds in trust solely for the benefit of the holders of the Notes, in amounts as will be sufficient, without
consideration of any reinvestment of interest, to pay and discharge the entire indebtedness (including all principal, premium,
if any, and interest) on such Notes delivered to the trustee for cancellation (in the case of Notes that have become due and payable
on or prior to the date of such deposit) or to the stated maturity or redemption date, as the case may be,

 

		•	we have paid or caused to be paid all other sums payable
by us under the Indenture with respect to the Notes; and

 

		•	we have delivered to the trustee an officers’ certificate
and legal opinion, each stating that all conditions precedent provided for in the Indenture, including amounts payable to the
trustee, relating to the satisfaction and discharge of the Indenture and the Notes have been complied with.

 

Additional Notes and Additional Series
of Notes

 

We may from time to
time, without notice to or the consent of the registered holders of the Notes, create and issue further notes ranking equally and
ratably with the Notes in all respects, including having the same CUSIP number, so that such further notes shall be consolidated
and form a single series of notes and shall have the same terms as to status or otherwise as the Notes. No additional notes may
be issued if an event of default has occurred and is continuing with respect to the Notes. The indenture also allows for the issuance
of additional series of debt securities from time to time.

 

    

     

    

 

The Trustee Under the Indenture

 

U.S. Bank National
Association serves as the trustee under the Indenture.

 

Payment, Paying Agent, Registrar and
Transfer Agent

 

The principal amount
of each Note is payable on the stated maturity date at the office of the Paying Agent, Registrar and Transfer Agent for the Notes
or at such other office in New York City as we may designate. The trustee acts as Paying Agent, Registrar and Transfer Agent for
the Notes.

 

Governing Law

 

The Indenture and the
Notes are governed by the laws of the State of New York.

 

Book-Entry Debt Securities

 

DTC acts as securities
depository for the Notes. The Notes are issued as fully registered securities registered in the name of Cede & Co. (DTC’s
partnership nominee) or such other name as may be requested by an authorized representative of DTC. One fully-registered certificate
is issued for the Notes, in the aggregate principal amount of such issue, and is deposited with DTC.

 

DTC is a limited-purpose
trust company organized under the New York Banking Law, a “banking organization” within the meaning of the New York
Banking Law, a member of the Federal Reserve System, a “clearing corporation” within the meaning of the New York Uniform
Commercial Code, and a “clearing agency” registered pursuant to the provisions of Section 17A of the Exchange Act.
DTC holds and provides asset servicing for issues of U.S. and non-U.S. equity issues, corporate and municipal debt issues, and
money market instruments that DTC’s participants (“Direct Participants”) deposit with DTC. DTC also facilitates
the post-trade settlement among Direct Participants of sales and other securities transactions in deposited securities through
electronic computerized book-entry transfers and pledges between Direct Participants’ accounts. This eliminates the need
for physical movement of securities certificates. Direct Participants include both U.S. and non-U.S. securities brokers and dealers,
banks, trust companies, clearing corporations, and certain other organizations. DTC is a wholly owned subsidiary of The Depository
Trust & Clearing Corporation (“DTCC”).

 

DTCC is the holding
company for DTC, National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered clearing
agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system is also available to others such as
both U.S. and non-U.S. securities brokers and dealers, banks, trust companies and clearing corporations that clear through or maintain
a custodial relationship with a Direct Participant, either directly or indirectly (“Indirect Participants”).

 

Purchases of debt securities
under the DTC system must be made by or through Direct Participants, which will receive a credit for the debt securities on DTC’s
records. The ownership interest of each actual purchaser of each security (“Beneficial Owner”) is in turn to be recorded
on the Direct and Indirect Participants’ records. Beneficial Owners do not receive written confirmation from DTC of their
purchase. Beneficial Owners are, however, expected to receive written confirmations providing details of the transaction, as well
as periodic statements of their holdings, from the Direct or Indirect Participant through which the Beneficial Owner entered into
the transaction. Transfers of ownership interests in the debt securities are to be accomplished by entries made on the books of
Direct and Indirect Participants acting on behalf of Beneficial Owners. Beneficial Owners do not receive certificates representing
their ownership interests in debt securities, except in the event that use of the book-entry system for the debt securities is
discontinued.

 

To facilitate subsequent
transfers, all debt securities deposited by Direct Participants with DTC are registered in the name of DTC’s partnership
nominee, Cede & Co. or such other name as may be requested by an authorized representative of DTC. The deposit of debt securities
with DTC and their registration in the name of Cede & Co. or such other DTC nominee do not affect any change in beneficial
ownership. DTC has no knowledge of the actual Beneficial Owners of the debt securities; DTC’s records reflect only the identity
of the Direct Participants to whose accounts such debt securities are credited, which may or may not be the Beneficial Owners.
The Direct and Indirect Participants are responsible for keeping account of their holdings on behalf of their customers.

 

Conveyance of notices
and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants
and Indirect Participants to Beneficial Owners will be governed by arrangements among them, subject to any statutory or regulatory
requirements as may be in effect from time to time.

 

    

     

    

 

Redemption notices
shall be sent to DTC. If less than all of the debt securities within an issue are being redeemed, DTC’s practice is to determine
by lot the amount of the interest of each Direct Participant in such issue to be redeemed.

 

Neither DTC nor Cede
 & Co. (nor such other DTC nominee) will consent or vote with respect to the Notes unless authorized by a Direct Participant
in accordance with DTC’s Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to us as soon as possible after
the record date. The Omnibus Proxy assigns Cede & Co.’s consenting or voting rights to those Direct Participants to whose
accounts the Notes are credited on the record date (identified in a listing attached to the Omnibus Proxy).

 

Redemption proceeds,
distributions, and dividend payments on the Notes will be made to Cede & Co., or such other nominee as may be requested by
an authorized representative of DTC. DTC’s practice is to credit Direct Participants’ accounts upon. DTC’s receipt
of funds and corresponding detail information from us or the trustee on the payment date in accordance with their respective holdings
shown on DTC’s records. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary
practices, as is the case with securities held for the accounts of customers in bearer form or registered in “street name,”
and will be the responsibility of such Participant and not of DTC nor its nominee, the trustee, or us, subject to any statutory
or regulatory requirements as may be in effect from time to time. Payment of redemption proceeds, distributions, and dividend payments
to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is the responsibility of us
or the trustee, but disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement of
such payments to the Beneficial Owners will be the responsibility of Direct and Indirect Participants.

 

DTC may discontinue
providing its services as securities depository with respect to the Notes at any time by giving reasonable notice to us or to the
trustee. Under such circumstances, in the event that a successor securities depository is not obtained, certificates are required
to be printed and delivered. We may decide to discontinue use of the system of book-entry-only transfers through DTC (or a successor
securities depository). In that event, certificates will be printed and delivered to DTC.

 

The information in
this section concerning DTC and DTC’s book-entry system has been obtained from sources that we believe to be reliable, but
we take no responsibility for the accuracy thereof.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00305-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00305-of-00352.parquet"}]]