Document:

EXHIBIT 10.3

 

EXCHANGE AGREEMENT

 

This EXCHANGE AGREEMENT
(the “Agreement”), dated as of June 25, 2015, is made by and among Real Goods Solar, Inc., a Colorado corporation,
with headquarters located at 833 West South Boulder Road, Louisville, CO 80027 (the “Company”), and the
Company investor listed on the signature page attached hereto (the “Holder”). Capitalized terms used herein
and not otherwise defined herein shall have the respective meanings set forth in the Securities Purchase Agreement (as defined
below).

 

Pursuant to that certain
Securities Purchase Agreement (“Securities Purchase Agreement”) dated as of February 23, 2015, by and
among the Company, the Holder and certain other investors party thereto (the “Other Holders” and together with
the Holder, the “Holders”), the Company sold to the Holders (i) shares (the “Common Shares”)
of the Company’s Class A common stock, par value $0.0001 per share (the “Common Stock”) and (ii) among
other warrants issued pursuant to the Securities Purchase Agreement, the Series A warrants in substantially the form attached as
Exhibit A to the Securities Purchase Agreement (the “Series A Warrants”) and the Series C warrants in
substantially the form attached as Exhibit A to the Securities Purchase Agreement (the “Series C Warrants”
and together with the Series A Warrants, the “Warrants”), in each case, representing the right to acquire additional
shares of Common Stock (the Series A Warrants as exercised, collectively, the “Series A Warrant Shares”
and the Series C Warrants as exercised, collectively, the “Series C Warrant Shares” and together with
the Series A Warrant Shares, the “Warrant Shares”).

 

The Company and the Holder
desire to exchange all of the Warrants held by the Holders for shares of Common Stock (the “Exchange Shares”)
pursuant to the terms hereof in a transaction undertaken in reliance upon the exemption from registration provided by Section 3(a)(9)
of the Securities Act of 1933, as amended (the “1933 Act”).

 

The Company is negotiating,
and intends to implement, the exchange of certain other Warrants issued pursuant to the Securities Purchase Agreement that are
currently outstanding by entering into agreements (the “Other Agreements”) in the same form as this Agreement.

 

NOW THEREFORE, in
consideration of the foregoing mutual premises and the covenants and agreements hereinafter set forth, and for other good and valuable
consideration, the receipt, and legal adequacy of which is hereby acknowledged, the parties hereto, intending to be legally bound,
hereby agree as follows:

 

		1.	ISSUANCE OF EXCHANGE SHARES.

 

Subject to the satisfaction
(or waiver) of the conditions set forth in Sections 4 and 5 below, the Company and the Holder hereby agree that on the Closing
Date (as defined in Section 2(a)), all the Warrants held by the Holder shall be exchanged for the right to receive from time to
time pursuant to the terms of this Agreement up to a number of Exchange Shares set forth on the Holder’s signature page attached
hereto. On the Closing Date, the Warrants held by the Holder will be deemed cancelled and all rights of the Holder thereunder will
terminate. The Holder shall return the original Warrant to the Company as soon as reasonably practicable after the Closing Date.

 

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		2.	CLOSING; EXCHANGES; RATIFICATIONS; CONFLICTS.

 

(a)          Closing. The
date and time of the closing (the “Closing”) of the transactions specified in Section 1 above (the “Closing
Date”) shall be 10:00 a.m., New York City Time, on June 30, 2015 (or such other date and time as is mutually agreed to
by the Company and the Holder), subject to the notification of satisfaction (or waiver) of the conditions to Closing set forth
in Sections 4 and 5 hereof. The Closing shall occur at the offices of Schulte Roth & Zabel LLP, 919 Third Avenue, New York,
New York 10022 and may be undertaken remotely by electronic exchange of documentation.

 

(b)          Exchanges.

 

(i)          Mechanics
of Exchange. Subject to the limitations set forth in Section 2(b)(vi), the Holder may at any time or times on or after the
Closing Date deliver to the Company and the Transfer Agent a written notice in the form attached hereto as Exhibit A (an
“Exchange Notice”) of the Holder’s election to receive all or any portion of the Exchange Shares set forth
on the Holder’s signature page attached hereto. Execution and delivery of an Exchange Notice with respect to less than all
of the Exchange Shares set forth on the Holder’s signature page attached hereto shall have the effect of lowering the number
of Exchange Shares still available to the Holder under this Agreement, if any, by the number of Exchange Shares set forth on such
Exchange Notice. On or before the first (1st) Trading Day following the date on which the Company has received an Exchange
Notice, the Company shall transmit by facsimile an acknowledgment of confirmation of receipt of such Exchange Notice to the Holder
and the Company’s transfer agent (the “Transfer Agent”). On or before the third (3rd) Trading Day following
the date on which the Company has received an Exchange Notice (a “Share Delivery Date”), the Company shall credit
such aggregate number of Exchange Shares to which the Holder is entitled pursuant to such Exchange Notice to the Holder’s
or its designee’s balance account with The Depository Trust Company (“DTC”) through its Deposit / Withdrawal
At Custodian system. The Company shall be responsible for all fees and expenses of the Transfer Agent and all fees and expenses
with respect to the issuance of Exchange Shares via DTC, if any. Upon delivery of an Exchange Notice, the Holder shall be deemed
for all corporate purposes to have become the holder of record of the Exchange Shares with respect to which the Exchange Notice
has been delivered, irrespective of the date such Exchange Shares are credited to the Holder’s DTC account. The Company shall
pay any and all taxes (other than the Holder’s income taxes) which may be payable with respect to the issuance and delivery
of Exchange Shares upon delivery of an Exchange Notice. The Company’s obligations to issue and deliver Exchange Shares in
accordance with the terms and subject to the conditions hereof are absolute and unconditional, irrespective of any action or inaction
by the Holder to enforce the same, any waiver or consent with respect to any provision hereof, the recovery of any judgment against
any Person or any action to enforce the same, or any setoff, counterclaim, recoupment, limitation or termination. As used herein,
“Trading Day” means any day on which the Common Stock is traded on the Principal Market, or, if the Principal
Market is not the principal trading market for the Common Stock, then on the principal securities exchange or securities market
on which the Common Stock is then traded; provided that “Trading Day” shall not include any day on which the
Common Stock is scheduled to trade on such exchange or market for less than 4.5 hours or any day that the Common Stock is suspended
from trading during the final hour of trading on such exchange or market (or if such exchange or market does not designate in advance
the closing time of trading on such exchange or market, then during the hour ending at 4:00:00 p.m., New York time).

 

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(ii)           [Intentionally
omitted.]

 

(iii)        Company’s
Failure to Timely Deliver Securities. If the Company shall fail on or prior to the applicable Share Delivery Date, for any
reason or for no reason, to credit the Holder’s or its designee’s balance account with DTC for such number of shares
of Common Stock to which the Holder is entitled pursuant to the applicable Exchange Notice (an “Exchange Failure”)
or credit the Holder’s or its designee’s balance account with DTC for the number of shares of Common Stock to which
the Holder is entitled hereunder or pursuant to the Company’s obligation pursuant to clause (ii) below, and if on or after
such Trading Day the Holder (or any other Person in respect, or on behalf, of the Holder) purchases (in an open market transaction
or otherwise) shares of Common Stock to deliver in satisfaction of a sale by the Holder of all or any portion of the number of
shares of Common Stock equal to or any portion of the number of shares of Common Stock issuable upon such exchange that the Holder
anticipated receiving from the Company (a “Buy-In”), then, in addition to all other remedies available to the
Holder, the Company shall, within three (3) Trading Days after the Holder’s request and in the Holder’s discretion,
either (i) pay cash to the Holder in an amount equal to the Holder’s total purchase price (including brokerage commissions
and other out-of-pocket expenses, if any) for the shares of Common Stock so purchased (the “Buy-In Price”),
at which point the Company’s obligation to credit the Holder’s or its designee’s balance account with DTC for
such shares of Common Stock shall terminate, or (ii) promptly honor its obligation to credit such Holder’s or its designee’s
balance account with DTC and pay cash to the Holder in an amount equal to the excess (if any) of the Buy-In Price over the product
of (A) such number of shares of Common Stock, times (B) any trading price of the Common Stock selected by the Holder in writing
as in effect at any time during the period beginning on the date of the applicable Exchange Notice and ending on the date of such
issuance and payment under this Section 1(b)(iii). In addition to the foregoing, if an Exchange Failure occurs and continues for
five (5) consecutive Trading Days, the Company shall within three (3) Trading Days after the Holder’s request and in the
Holder’s discretion, deliver a warrant in substantially the form of the Warrants to purchase a number of shares of Common
Stock equal to the number of Exchange Shares to which the Holder is entitled pursuant to the applicable Exchange Notice, with an
exercise price equal to the par value of the Common Stock and exercisable immediately for a term of up to sixty (60) months and
using at any time during such period, at the election of the Holder, the cashless feature of such Warrants. Nothing shall limit
the Holder’s right to pursue any other remedies available to it hereunder, at law or in equity, including, without limitation,
a decree of specific performance and/or injunctive relief with respect to the Company’s failure to timely electronically
deliver such shares of Common Stock upon the delivery of an Exchange Notice pursuant to the terms hereof.

 

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(iv)        Certain
Adjustments. 

 

(1) Adjustment
Upon Subdivision or Combination of Shares of Common Stock. If the Company at any time on or after the date of this Agreement
subdivides (by any stock split, stock dividend, recapitalization or otherwise) one or more classes of its outstanding shares of
Common Stock into a greater number of shares, the number of Exchange Shares will be proportionately increased. If the Company at
any time on or after the date of this Agreement combines (by combination, reverse stock split or otherwise) one or more classes
of its outstanding shares of Common Stock into a smaller number of shares, the number of Exchange Shares will be proportionately
decreased. Any adjustment under this Section 1(b)(iv) shall become effective at the close of business on the date the subdivision
or combination becomes effective.

 

(2)Purchase
Rights. If the Company shall grant, issue or sell any Options, Convertible Securities (each as defined in the Securities Purchase
Agreement) or rights to purchase stock, warrants, securities or other property pro rata to the record holders of any class of Common
Stock (the “Purchase Rights”), at any time after the date hereof and prior to the date of issuance of all Exchange
Shares which the Company is obligated to issue under this Agreement, then, in each case, the Holder shall be entitled to acquire,
upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights, with respect to each unissued Exchange Share,
to the same extent that the Holder would have participated therein with respect to each such Exchange Share if the Holder had held
such unissued Exchange Shares (without taking into account any limitations or restrictions on the issuance of Exchange shares,
including without limitation, the Maximum Percentage (as defined in Section 2(b)(vi)) immediately before the date on which a record
is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record
holders of shares of Common Stock are to be determined for the grant, issue or sale of such Purchase Rights (provided, however,
that to the extent that the Holder’s right to participate in any such Purchase Right would result in the Holder and the other
Attribution Parties (as defined in Section 2(b)(vi)) exceeding the Maximum Percentage, then the Holder shall not be entitled to
participate in such Purchase Right to such extent (and shall not be entitled to beneficial ownership of such shares of Common Stock
as a result of such Purchase Right (and beneficial ownership) to such extent) and such Purchase Right to such extent shall be held
in abeyance for the benefit of the Holder until such time or times as its right thereto would not result in the Holder and the
other Attribution Parties exceeding the Maximum Percentage, at which time or times the Holder shall be granted such right (and
any Purchase Right granted, issued or sold on such initial Purchase Right or on any subsequent Purchase Right held similarly in
abeyance) to the same extent as if there had been no such limitation).

 

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(3)Other
Events. If any event occurs of the type contemplated by the provisions of this Section 2(b)(iv) but not expressly provided
for by such provisions (including, without limitation, the granting of stock appreciation rights, phantom stock rights or other
rights with equity features), then the Company’s Board of Directors will make an appropriate adjustment in the number of
Exchange Shares, as mutually determined by the Company’s Board of Directors and the Holder, so as to protect the rights of
the Holder; provided that no such adjustment pursuant to this Section 2(b)(iv) will decrease the number of Exchange Shares as otherwise
determined pursuant to this Section 2(b)(iv).

 

(4)Pro
Rata Distributions. If the Company shall declare or make any dividend or other distributions of its assets (or rights to acquire
its assets) to any or all holders of Common Stock, by way of return of capital or otherwise (including, without limitation, any
distribution of cash, stock or other securities, property or options by way of a dividend, spin off, reclassification, corporate
rearrangement, scheme of arrangement or other similar transaction) (a “Distribution”), at any time after the
date hereof and prior to the date of issuance of all Exchange Shares which the Company is obligated to issue under this Agreement
then, in each such case, the Holder shall be entitled to participate in such Distribution, with respect to each unissued Exchange
Share, to the same extent that the Holder would have participated therein with respect to each such Exchange Share if the Holder
had held such unissued Exchange Shares (without taking into account any limitations or restrictions on the issuance of Exchange
Shares, including without limitation, the Maximum Percentage) immediately before the date of which a record is taken for such Distribution,
or, if no such record is taken, the date as of which the record holders of shares of Common Stock are to be determined for the
participation in such Distribution (provided, however, to the extent that the Holder’s right to participate
in any such Distribution would result in the Holder exceeding the Maximum Percentage, then the Holder shall not be entitled to
participate in such Distribution to such extent (or in the beneficial ownership of any shares of Common Stock as a result of such
Distribution to such extent) and the portion of such Distribution shall be held in abeyance for the benefit of the Holder until
such time, if ever, as its right thereto would not result in the Holder exceeding the Maximum Percentage).

 

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(5)Fundamental
Transaction. If, at any time after the date hereof and until the date any Exchange Shares may be issued hereunder, a Fundamental
Transaction occurs or is consummated, the Company shall cause any Successor Entity (as defined in the Warrants) to assume in writing
all of the obligations of the Company under this Agreement in accordance with the provisions of this Section 2(b)(iv)(5) pursuant
to written agreements in form and substance reasonably satisfactory to the Holder and approved by the Holder, such approval not
to be unreasonably withheld or delayed, prior to such Fundamental Transaction, such that for each Exchange Share otherwise issuable
under this Agreement not issued prior to the date of the occurrence or consummation of such Fundamental Transaction, the Holder
shall be entitled to receive a corresponding number of shares of capital stock of the successor or acquiring corporation or of
the Company, if it is the surviving corporation (but taking into account the relative value of the shares of Common Stock pursuant
to such Fundamental Transaction and the value of such shares of capital stock, such adjustments to the number of shares of capital
stock being for the purpose of protecting the economic value of the Exchange Shares immediately prior to the occurrence or consummation
of such Fundamental Transaction) (provided, however, to the extent that the Holder’s right to receive any such
shares of publicly traded common stock (or their equivalent) of the Successor Entity would result in the Holder and its other Attribution
Parties exceeding the Maximum Percentage, if applicable, then the Holder shall not be entitled to receive such shares to such extent
(and shall not be entitled to beneficial ownership of such shares of publicly traded common stock (or their equivalent) of the
Successor Entity as a result of such consideration to such extent) and the portion of such shares shall be held in abeyance for
the Holder until such time or times, as its right thereto would not result in the Holder and its other Attribution Parties exceeding
the Maximum Percentage, at which time or times the Holder shall be delivered such shares to the extent as if there had been no
such limitation), and any additional consideration (the “Alternate Consideration”) receivable as a result of
such Fundamental Transaction by a holder of shares of Common Stock immediately prior to such Fundamental Transaction.  If
holders of Common Stock are given any choice as to the securities, cash or property to be received in a Fundamental Transaction,
then the Holder shall be given the same choice as to the Alternate Consideration it receives upon the issuance of Exchange Shares
following such Fundamental Transaction. Upon the occurrence or consummation of any Fundamental Transaction, and it shall be a required
condition to the occurrence or consummation of any Fundamental Transaction that, the Company and the Successor Entity or Successor
Entities, jointly and severally, shall succeed to, and the Company shall cause any Successor Entity or Successor Entities to jointly
and severally succeed to, and be added to the term “Company” under this Agreement (so that from and after the date
of such Fundamental Transaction, and the provisions of this Agreement referring to the “Company” shall refer instead
to each of the Company and the Successor Entity or Successor Entities, jointly and severally), and the Company and the Successor
Entity or Successor Entities, jointly and severally, may exercise every right and power of the Company prior thereto and shall
assume all of the obligations of the Company prior thereto under this Agreement with the same effect as if the Company and such
Successor Entity or Successor Entities, jointly and severally, had been named as the Company in this Agreement. The Company shall
provide the Holder with written notice, including a summary of material terms, of any Fundamental Transaction described in the
preceding sentence no less than fifteen (15) days prior to the occurrence or consummation such Fundamental Transaction, provided
that if the Company does not have knowledge of such Fundamental Transaction or material terms thereof at least fifteen (15) days
prior to the occurrence or consummation of such Fundamental Transaction, the Company shall provide written notice, including a
summary of material terms, within two (2) Trading Days of having such knowledge.  

 

(6)Calculations.
All calculations under this Section 2(b) shall be made to the nearest cent or the nearest 1/100th of a share. For purposes of this
Section 2(b), the number of shares of Common Stock deemed to be issued and outstanding as of a given date shall be the sum of the
number of shares of Common Stock (excluding treasury shares, if any) issued and outstanding.

 

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(7)Notice
to the Holder.

 

(A) Adjustment
to Number of Exchange Shares. Whenever there is an adjustment pursuant to any provision of Section 2(b)(iv), the Company
shall promptly notify the Holder by providing a notice setting forth the adjustment to
the number of Exchange Shares and setting forth a brief statement of the facts requiring such adjustment.  

 

(B) Notice of
Certain Events. If (A) the Company shall declare a dividend (or any other distribution
in whatever form) on the Common Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of
the Common Stock, (C) the Company shall authorize the granting to all holders of the Common Stock rights or warrants to subscribe
for or purchase any shares of capital stock of any class or of any rights, (D) the approval of any stockholders of the Company
shall be required in connection with any Fundamental Transaction whereby the Common Stock are converted into other securities,
cash or property, or (E) the Company shall authorize the voluntary or involuntary dissolution, liquidation or winding up of the
affairs of the Company, in each case until the date any Exchange Shares may be issued hereunder, then, in each case, the Company
shall notify the Holder at its last address, at least twenty (20) calendar days prior to the applicable record or effective date
hereinafter specified, a notice stating (x) the date on which a record is to be taken for
the purpose of such dividend, distribution, redemption, rights or warrants, or if a record is not to be taken, the date as of which
the holders of the Common Stock of record to be entitled to such dividend, distributions, redemption, rights or warrants are to
be determined or (y) the date on which such Fundamental Transaction is expected to become effective or close, and the date
as of which it is expected that holders of the Common Stock of record shall be entitled to exchange their shares of the Common
Stock for securities, cash or other property deliverable upon such Fundamental Transaction; provided that the failure to mail such
notice or any defect therein or in the mailing thereof shall not affect the validity of the corporate action required to be specified
in such notice.  To the extent that any notice provided hereunder constitutes, or contains, material, non-public information
regarding the Company or any of its subsidiaries, the Company shall simultaneously file such notice with the SEC pursuant to a
Current Report on Form 8-K.

 

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(v)         Dispute
Resolution.  In the case of a dispute as to the determination of the number of Exchange Shares issuable hereunder
and/or the amount of cash payable hereunder, the Company shall submit the disputed determinations or arithmetic calculations via
facsimile within two (2) Business Days of event giving rise to such dispute, as the case may be, to the Holder.  If the
Holder and the Company are unable to agree upon such determination or calculation of the number of shares of Common Stock issauble
within three (3) Business Days of such disputed determination or arithmetic calculation being submitted to the Holder, then the
Company shall, within two (2) Business Days submit via facsimile (a) the disputed determination of the number of Exchange Shares
and/or the amount of cash to an independent, reputable investment bank selected by the Holder and approved by the Company, such
approval not to be unreasonably withheld or delayed or (b) the disputed arithmetic calculation of the number of Exchange Shares
and/or the amount of cash to the Company’s independent, outside accountant.  The Company shall cause at its expense
the investment bank or the accountant, as the case may be, to perform the determinations or calculations and notify the Company
and the Holder of the results no later than ten (10) Business Days from the time it receives the disputed determinations or calculations.  Such
investment bank’s or accountant’s determination or calculation, as the case may be, shall be binding upon all parties
absent demonstrable error. As used herein, “Business Day” means any day other than Saturday, Sunday or other
day on which commercial banks in The City of New York are authorized or required by law to remain closed.

 

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(vi)        Beneficial
Ownership Limitation on Exchanges. Notwithstanding anything to the contrary contained herein, the Company shall not effect
any exchange as set forth in Section 2(b)(i) hereof, and the Holder shall not have the right to deliver an Exchange Notice to the
Company pursuant to this Agreement and any such exchange shall be null and void and treated as if never made, to the extent that
after giving effect to such exchange, the Holder together with the other Attribution Parties collectively would beneficially own
in excess of 9.99% (the “Maximum Percentage”) of the number of shares of Common Stock outstanding immediately
after giving effect to such exchange. For purposes of the foregoing sentence, the aggregate number of shares of Common Stock beneficially
owned by the Holder and the other Attribution Parties shall include the number of shares of Common Stock held by the Holder and
all other Attribution Parties plus the number of shares of Common Stock pursuant to this Agreement with respect to which the determination
of such sentence is being made, but shall exclude the number of shares of Common Stock which would be issuable upon (A) exchange
of the remaining, unexercised portion of the Exchange Shares pursuant to this Agreement and (B) exercise or conversion of the unexercised
or unconverted portion of any other securities of the Company beneficially owned by the Holder or any other Attribution Party subject
to a limitation on conversion or exercise analogous to the limitation contained in this Section 2(b)(vi). For purposes of this
Section 2(b)(vi), beneficial ownership shall be calculated in accordance with Section 13(d) of the 1934 Act. For purposes hereof,
in determining the number of outstanding shares of Common Stock the Holder may acquire pursuant to this Agreement without exceeding
the Maximum Percentage, the Holder may rely on the number of outstanding shares of Common Stock as reflected in (x) the Company’s
most recent Annual Report on Form 10-K, Quarterly Report on Form 10-Q, Current Report on Form 8-K or other public filing with the
SEC, as the case may be, (y) a more recent public announcement by the Company or (3) any other written notice by the Company or
the Transfer Agent setting forth the number of shares of Common Stock outstanding (the “Reported Outstanding Share Number”).
If the Company receives an Exchange Notice from the Holder at a time when the actual number of outstanding shares of Common Stock
is less than the Reported Outstanding Share Number, the Company shall (i) notify the Holder in writing of the number of shares
of Common Stock then outstanding and, to the extent that such Exchange Notice would otherwise cause the Holder’s beneficial
ownership, as determined pursuant to this Section 2(b)(vi), to exceed the Maximum Percentage, the Holder must notify the Company
of a reduced number of Exchange Shares to be purchased pursuant to such Exchange Notice. For any reason at any time, upon the written
or oral request of the Holder, the Company shall within one (1) Business Day confirm orally and in writing or by electronic mail
to the Holder the number of shares of Common Stock then outstanding. In any case, the number of outstanding shares of Common Stock
shall be determined after giving effect to the conversion or exercise of securities of the Company or exchange pursuant to this
Agreement by the Holder and any other Attribution Party since the date as of which the Reported Outstanding Share Number was reported.
In the event that the issuance of Exchange Shares results in the Holder and the other Attribution Parties being deemed to beneficially
own, in the aggregate, more than the Maximum Percentage of the number of outstanding shares of Common Stock (as determined under
Section 13(d) of the 1934 Act), the number of shares so issued by which the Holder’s and the other Attribution Parties’
aggregate beneficial ownership exceeds the Maximum Percentage (the “Excess Shares”) shall be deemed null and
void and shall be cancelled ab initio and the Holder shall not have the power to vote or to transfer the Excess Shares. Upon delivery
of a written notice to the Company, the Holder may from time to time increase (with such increase not effective until the sixty-first
(61st) day after delivery of such notice) or decrease the Maximum Percentage to any other percentage not in excess of
9.99% as specified in such notice; provided that (i) any such increase in the Maximum Percentage will not be effective until the
sixty-first (61st) day after such notice is delivered to the Company and (ii) any such increase or decrease will apply
only to the Holder and the other Attribution Parties and not to any other shareholder of the Company that is not an Attribution
Party of the Holder. For purposes of clarity, the Exchange Shares issuable pursuant to the terms of this Agreement in excess of
the Maximum Percentage shall not be deemed to be beneficially owned by the Holder for any purpose including for purposes of Section
13(d) or Rule 16a-1(a)(1) of the 1934 Act. The provisions of this paragraph shall be construed and implemented in a manner otherwise
than in strict conformity with the terms of this Section 2(b)(vi) to the extent necessary to correct this paragraph or any portion
of this paragraph which may be defective or inconsistent with the intended beneficial ownership limitation contained in this Section
2(b)(vi) or to make changes or supplements necessary or desirable to properly give effect to such limitation. The limitation contained
in this paragraph may not be waived and shall apply to a successor of the Holder. As used herein, (x) “Attribution Parties”
means, collectively, the following Persons and entities: (i) any investment vehicle, including, any funds, feeder funds or managed
accounts, currently, or from time to time after the Issuance Date, directly or indirectly managed or advised by the Holder’s
investment manager or any of its Affiliates or principals, (ii) any direct or indirect Affiliates of the Holder or any of the foregoing,
(iii) any Person acting or who could be deemed to be acting as a Group together with the Holder or any of the foregoing and (iv)
any other Persons whose beneficial ownership of the Company’s Common Stock would or could be aggregated with the Holder’s
and the other Attribution Parties for purposes of Section 13(d) of the 1934 Act. For clarity, the purpose of the foregoing is to
subject collectively the Holder and all other Attribution Parties to the Maximum Percentage, (y) “Group” means
a “group” as that term is used in Section 13(d) of the 1934 Act and as defined in Rule 13d-5 thereunder and (z) ) “Affiliate”
has the meaning set forth in Rule 405 under the 1933 Act.

 

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(c)          Ratifications.
Except as otherwise expressly provided herein, the Securities Purchase Agreement and each other Transaction Document, are, and
shall continue to be, in full force and effect and is hereby ratified and confirmed in all respects, except that on and after the
Closing Date (i) all references in the Securities Purchase Agreement to “this Agreement”, “hereto”, “hereof”,
“hereunder” or words of like import referring to the Securities Purchase Agreement shall mean the Securities Purchase
Agreement as amended by this Agreement, and (ii) all references in the other Transaction Documents and to the “Securities
Purchase Agreement” (and corollary references to “thereto”, “thereof”, “thereunder” or
words of like import referring to the Securities Purchase Agreement) shall mean the Securities Purchase Agreement as amended by
this Agreement.

 

(d)          Conflicts.
To the extent of any inconsistencies in interpretation between the terms of this Agreement and the terms of the Transaction Documents
as originally entered into between the Company and the Holder on or about February 23, 2015, the terms of this Agreement shall
govern.

 

		3.	REPRESENTATIONS, WARRANTIES, AGREEMENTS AND
COVENANTS.

 

(a)         Holder Representations,
Warranties and Covenants. The Holder hereby represents, warrants and covenants, as applicable, to the Company that:

 

(i)          Organization;
Authorization; Enforcement; Validity. The Holder is an entity duly organized, validly existing and in good standing under the
laws of the jurisdiction of its organization. The Holder has the power and authority to execute and deliver this Agreement and
perform its obligations hereunder and this Agreement and the transactions contemplated hereby have been duly authorized by the
Holder. This Agreement has been duly and validly authorized, executed and delivered on behalf of the Holder and shall constitute
the legal, valid and binding obligations of the Holder enforceable against the Holder in accordance with its terms, except as such
enforceability may be limited by general principles of equity or to applicable bankruptcy, insolvency, reorganization, moratorium,
liquidation and other similar laws relating to, or affecting generally, the enforcement of applicable creditors’ rights and
remedies.

 

(ii)         No Conflicts.
The execution, delivery and performance by the Holder of this Agreement and the consummation by the Holder of the transactions
contemplated hereby will not (i) result in a violation of the organizational documents of the Holder or (ii) conflict with, or
constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give to others any
rights of termination, amendment, acceleration or cancellation of, any agreement, indenture or instrument to which the Holder is
a party, or (iii) result in a violation of any law, rule, regulation, order, judgment or decree (including federal and state securities
laws) applicable to the Holder, except in the case of clauses (ii) and (iii) above, for such conflicts, defaults, rights or violations
which would not, individually or in the aggregate, reasonably be expected to have a material adverse effect on the ability of the
Holder to perform its obligations hereunder.

 

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(iii)        Title to Warrant.
The Holder is the beneficial owner and sole legal owner of, and has good and valid title to, the Warrants, free and clear of any
mortgage, lien, pledge, charge, security interest, encumbrance, title retention agreement, option, equity or other adverse claim
thereto other than encumbrances by one or more brokers of the Holder, which shall terminate upon the Closing, and encumbrances
under federal or state securities laws (“Claims”). The Holder has not, in whole or in part, (i) assigned, transferred,
hypothecated, pledged or otherwise disposed of the Warrant or its rights in the Warrant, or (ii) given any person or entity
any transfer order, power of attorney or other authority of any nature whatsoever with respect to the Warrant. Good and valid title
to the Warrant, free and clear of any Claims, will pass to the Company upon consummation of the transaction contemplated hereby.

 

(b)          Company Representations,
Warranties and Covenants. The Company hereby represents, agrees, warrants and covenants, as applicable, to and with the Holder
that:

 

(i)          Organization
and Qualification. Each of the Company and its Subsidiaries are entities duly organized and validly existing and in
good standing under the laws of the jurisdiction in which they are formed, and have the requisite power and authorization to own
their properties and to carry on their business as now being conducted. Each of the Company and its Subsidiaries is duly qualified
as a foreign entity to do business and is in good standing in every jurisdiction in which its ownership of property or the nature
of the business conducted by it makes such qualification necessary, except to the extent that the failure to be so qualified or
be in good standing would not reasonably be expected to have a Material Adverse Effect. As used in this Agreement, “Material
Adverse Effect” means any material adverse effect on (i) the business, properties, assets, operations, results of operations,
condition (financial or otherwise) or prospects of the Company and its Subsidiaries, individually or taken as a whole, (ii) the
transactions contemplated hereby, or (iii) the authority or the ability of the Company to perform its obligations under this Agreement
or to consummate any transactions contemplated by this Agreement.

 

(ii)          Solvency.
Neither the Company nor any of its Subsidiaries has taken any steps to seek protection pursuant to any bankruptcy law nor does
the Company have knowledge that its creditors or its Subsidiaries’ creditors intend to initiate involuntary bankruptcy proceedings
or knowledge of any fact which would reasonably lead a creditor to do so. The Company and its Subsidiaries, individually and on
a consolidated basis, are not as of the date hereof, and after giving effect to the transactions contemplated hereby will not be,
Insolvent.

 

(iii)        Authorization;
Enforcement; Validity. The Company has the requisite corporate power and authority to enter into and perform its obligations
under this Agreement and to issue the Exchange Shares from time to time in accordance with the terms hereof. The execution and
delivery of this Agreement by the Company and the consummation by the Company of the transactions contemplated hereby, including,
without limitation, the issuance of the Exchange Shares from time to time have been duly authorized by the Company’s Board
of Directors and no further filing, consent or authorization is required by the Company, its Board of Directors or its shareholders.
This Agreement has been duly executed and delivered by the Company, and constitutes the legal, valid and binding obligations of
the Company, enforceable against the Company in accordance with its terms, except as such enforceability may be limited by general
principles of equity or applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or similar laws relating to,
or affecting generally, the enforcement of applicable creditors’ rights and remedies.

 

    	11

    	 

    

 

(iv)        Issuance of
Securities. The issuance of the Exchange Shares is duly authorized and, upon issuance in accordance with the terms hereof,
the Exchange Shares shall be validly issued, fully paid and non-assessable and free from all preemptive or similar rights, taxes,
liens and charges and other encumbrances with respect to the issue thereof and the Exchange Shares shall be fully paid and nonassessable
with the holder thereof being entitled to all rights accorded to a holder of Common Stock. The offer and issuance by the Company
of the Exchange Shares in conformity with this Agreement constitute transactions exempt from registration under the 1933 Act pursuant
to Section 3(a)(9) of the 1933 Act.

 

(v)         No Conflicts.
The execution, delivery and performance of this Agreement by the Company and the consummation by the Company of the transactions
contemplated hereby (including, without limitation, the reservation for issuance and issuance of the Exchange Shares) will not
(i) result in a violation of the Company’s Articles of Incorporation or Bylaws or other organizational documents of the Company
or any of its Subsidiaries, any capital stock of the Company or any of its Subsidiaries or the articles of association or bylaws
of the Company or any of its Subsidiaries or (ii) conflict with, or constitute a default (or an event which with notice or lapse
of time or both would become a default) in any respect under, or give to others any rights of termination, amendment, acceleration
or cancellation of, any agreement, indenture or instrument to which the Company or any of its Subsidiaries is a party, or (iii)
result in a violation of any law, rule, regulation, order, judgment or decree (including foreign, federal and state securities
laws and regulations and the rules and regulations of Principal Market and including all applicable foreign, federal and state
laws, rules and regulations) applicable to the Company or any of its Subsidiaries or by which any property or asset of the Company
or any of its Subsidiaries is bound or affected.

 

(vi)        Consents.
The Company is not required to obtain any consent from, authorization or order of, or make any filing or registration with any
court, governmental agency or any regulatory or self-regulatory agency or any other Person in order for it to execute, deliver
or perform any of its obligations under or contemplated by this Agreement, in each case, in accordance with the terms hereof. All
consents, authorizations, orders, filings and registrations which the Company is required to obtain pursuant to the preceding sentence
have been obtained or effected on or prior to the Closing Date, and the Company is unaware of any facts or circumstances which
might prevent the Company from obtaining or effecting any of such registrations, applications or filings. The Company is not in
violation of the requirements of the Principal Market and has no knowledge of any facts or circumstances which would reasonably
lead to delisting or suspension of the Common Stock in the foreseeable future. The issuance by the Company of the Exchange Shares
shall not have the effect of delisting or suspending the Common Stock from the Principal Market.

 

    	12

    	 

    

 

(vii)        Absence of
Litigation. There is no action, suit, proceeding, inquiry or investigation before or by the Principal Market, any court, public
board, government agency, self-regulatory organization or body pending or, to the knowledge of the Company, threatened against
or affecting the Company or any of its Subsidiaries, the Common Stock or any of the Company’s Subsidiaries or any of the
Company’s or its Subsidiaries’ officers or directors, whether of a civil or criminal nature or otherwise, in their
capacities as such, which has not been previously disclosed in an SEC Document (as defined in Section 3(b)(ix)) or would reasonably
be expected to result in a Material Adverse Effect.

 

(viii)      Other Agreements.
The Company will not provide any Other Holder with a more favorable exchange ratio than is provided to the Holder hereunder or
offer any consideration (other than the reimbursement of legal fees) to any Other Holder without offering the same consideration
to the Holder.

 

(ix)         SEC Filings.
As of their respective filing dates, the Company’s filings with the SEC under the 1934 Act since February 23, 2015 (the “SEC
Documents”), complied in all material respects with the requirements of the Exchange Act and the rules and regulations
of the SEC promulgated thereunder applicable to the SEC Documents, and none of the SEC Documents, at the time they were filed with
the SEC, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or
necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.
 The Company represents that, as of the date hereof, no material event or circumstance has occurred which would be required
to be publicly disclosed or announced on a Current Report on Form 8-K, either as of the date hereof or solely with the passage
of time by the Company but which has not been so publicly announced or disclosed.

 

(x)           Disclosure of
Transactions and Other Material Information. The Company shall file a current report on Form 8-K (the “8-K Filing”)
on or before 8:30 a.m., New York City time, on the first Business Day following the date of this Agreement, in the form required
by the 1934 Act, relating to the transactions contemplated by this Agreement and attaching this Agreement or a form hereof (including,
without limitation, all schedules and exhibits to this Agreement) as an exhibit to such filing. From and after the filing of the
8-K Filing with the SEC, the Holder shall not be in possession of any material, nonpublic information received from the Company,
any of its Subsidiaries or any of their respective officers, directors, Affiliates, employees or agents, that is not disclosed
in the 8-K Filing. In addition, effective upon the filing of the 8-K Filing, the Company acknowledges and agrees that any and all
confidentiality or similar obligations under any agreement, whether written or oral, between the Company, any of its Subsidiaries
or any of their respective officers, directors, Affiliates, employees or agents, on the one hand, and the Holder or any of its
Affiliates, on the other hand, shall terminate. The Company shall not, and shall cause each of its Subsidiaries and its and each
of their respective officers, directors, Affiliates, employees and agents, not to, provide the Holder with any material, nonpublic
information regarding the Company or any of its Subsidiaries from and after the date hereof without the express prior written consent
of the Holder. To the extent that the Company, any of its Subsidiaries or any of their respective officers, directors, Affiliates,
employees or agents delivers any material, non-public information to the Holder without the Holder’s consent, the Company
hereby covenants and agrees that the Holder’s shall not have any duty of confidentiality to the Company, any of its Subsidiaries
or any of their respective officers, directors, Affiliates, employees or agents with respect to, or a duty to the Company, any
of its Subsidiaries or any of their respective officers, directors, Affiliates, employees or agents not to trade on the basis of,
such material, non-public information. The Company understands and confirms that the Holder will rely on the foregoing representations
in effecting transactions in securities of the Company.

 

    	13

    	 

    

 

(xi)         Holding Period.
The Company acknowledges and agrees that in accordance with Section 3(a)(9) of the 1933 Act, the Exchange Shares shall take on
the registered characteristics of the Warrants with respect to which such Exchange Shares are being issued, and the holding period
of such Warrants may be tacked on to the holding period of the Exchange Shares. The Company agrees not to take any position contrary
to this Section 3(b)(ix) for purposes of Section 3(a)(9) or Rule 144 of the 1933 Act. The Company agrees to take all actions, including,
without limitation, the issuance by its legal counsel of any necessary legal opinions, necessary to issue unrestricted Exchange
Shares that are freely tradable on the Principal Market without restriction and not containing any restrictive legend without the
need for any action by the Holder.

 

(xii)        Listing.
The Company shall promptly secure the listing of all of (i) the Exchange Shares and (ii) any capital stock of the Company issued
or issuable with respect to the Exchange Shares, as applicable, as a result of any stock split, stock dividend, recapitalization,
exchange or similar event or otherwise (the “Listed Securities”) upon each national securities exchange and
automated quotation system, if any, upon which the Common Stock is then listed (subject to official notice of issuance) and shall
maintain such listing of all Listed Securities from time to time issuable under the terms of the Transaction Documents. The Company
shall pay all fees and expenses in connection with satisfying its obligations under this Section 3(b)(x).

 

(xiii)       Reporting
Status. Until the date on which the Holder has sold all the Exchange Shares, the Company shall timely file all reports required
to be filed with the SEC pursuant to the 1934 Act, and the Company shall not terminate its status as an issuer required to file
reports under the 1934 Act even if the 1934 Act or the rules and regulations thereunder would no longer require or otherwise permit
such termination.

 

(xiv)       No Integration
Actions. None of the Company, any of its Affiliates or any Person acting on behalf of the Company or such Affiliate will sell,
offer for sale or solicit offers to buy in respect of any security (as defined in the 1933 Act) that would be integrated with the
issuance of the Exchange Shares in a manner that would require the registration under the 1933 Act of the issuance to the Holder
or require shareholder approval under the rules and regulations of the Principal Market, and the Company will take all action that
is appropriate or necessary to assure that its offerings of other securities will not be integrated for purposes of the 1933 Act
or the rules and regulations of the Principal Market with the issuance of Exchange Shares contemplated hereby.

 

(xv)        Reservation
of Shares. From the date hereof until the Closing, the Company shall take all action necessary to at all times have authorized,
and reserved for the purpose of issuance, no less than 2,000,000 shares of Common Stock (as adjusted for any stock dividend, stock
split, stock combination, reclassification or similar transaction occurring after the date hereof) issuable as Exchange Shares
under this Agreement and under the Other Agreements.

 

    	14

    	 

    

 

(xvi)      Most Favored
Nation. The Company hereby represents and warrants as of the date hereof and covenants and agrees from and after the date hereof
that none of the terms offered to any Person with respect to any amendment, exercise or exchange of the Warrants (each an “Exchange
Document”), is or will be more favorable to such Person than those of the Holder and this Agreement shall be, without
any further action by the Holder or the Company, deemed amended and modified in an economically and legally equivalent manner such
that the Holder shall receive the benefit of the more favorable terms contained in such Exchange Document. Notwithstanding the
foregoing, the Company agrees, at its expense, to take such other actions (such as entering into amendments to this Agreement)
as the Holder may reasonably request to further effectuate the foregoing.

 

(xvii)     [INSERT ONLY
IN THE EXCHANGE AGREEMENT OF LEAD INVESTOR: Fees and Expenses. The Company shall reimburse the Holder for its legal
fees and expenses in connection with the preparation and negotiation of this Agreement and transactions contemplated thereby, by
paying any such amount to Schulte Roth & Zabel LLP in an amount not to exceed $10,000 (the “Holder Counsel Expense”)
by wire transfer of immediately available funds in accordance with the written instructions of Schulte Roth & Zabel LLP delivered
to the Company on or prior to the Closing. The Holder Counsel Expense shall be paid by the Company whether or not the transactions
contemplated by this Agreement are consummated. Except as otherwise set forth above, each party shall pay the fees and expenses
of its advisers, counsel, accountants and other experts, if any, and all other expenses incurred by such party incident to the
negotiation, preparation, execution, delivery and performance of this Agreement. The Company shall pay all stamp and other taxes
and duties levied in connection with the transactions contemplated hereby, if any.]

 

		4.	CONDITIONS TO ComPANY’S OBLIGATIONs hereunder.

 

The obligations of the
Company to the Holder hereunder are subject to the satisfaction of each of the following conditions, provided that these conditions
are for the Company’s sole benefit and may be waived by the Company at any time in its sole discretion by providing the Holder
with prior written notice thereof:

 

(a)         The Holder shall have
duly executed this Agreement and delivered the same to the Company; and

 

(b)         The representations
and warranties of the Holder shall be true and correct as of the date when made and as of the Closing Date as though made at that
time (except for representations and warranties that speak as of a specific date which shall
be true and correct as of such specified date), and the Holder shall have performed, satisfied
and complied with the covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with
by the Holder at or prior to the Closing Date.

 

(c)          The Principal Market
shall have verbally approved, and shall not have disapproved, in writing or otherwise, the transactions contemplated by this Agreement
and the issuance and delivery of the Exchange Shares pursuant to terms set forth in this Agreement.

 

    	15

    	 

    

 

		5.	CONDITIONS TO HOLDER’S OBLIGATIONs HEREUNDER.

 

The obligations of the
Holder hereunder are subject to the satisfaction of each of the following conditions, provided that these conditions are for the
Holder’s sole benefit and may be waived by the Holder in respect of itself at any time in its sole discretion by providing
the Company with prior written notice thereof:

 

(a)         The Company shall
have duly executed this Agreement and delivered the same to the Holder;

 

(b)         The Company shall
have obtained the listing of all of the Exchange Shares on upon each national securities exchange and automated quotation system,
if any, upon which the Common Stock is then listed;

 

(c)         The representations
and warranties of the Company under this Agreement shall be true and correct in all respects as of the date when made and as of
the Closing Date as though made at that time (except for representations and warranties that speak as of a specific date which
shall be true and correct as of such specified date) and the Company shall have performed, satisfied and complied in all respects
with the covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by the Company
at or prior to the Closing Date;

 

(d)         The Common Stock (i)
shall be designated for quotation or listed on the Principal Market and (ii) shall not have been suspended, as of the Closing Date,
by the SEC or the Principal Market from trading on the Principal Market nor shall suspension by the SEC or the Principal Market,
which has not previously been disclosed in an SEC Document, have been threatened, as of the Closing Date, either (A) in writing
by the SEC or the Principal Market or (B) by falling below the minimum listing maintenance requirements of the Principal Market;
and

 

(e)         The Company shall
have obtained all governmental, regulatory or third party consents and approvals, if any, necessary for the transactions contemplated
hereby.

 

(f)          The Principal Market
shall have verbally approved, and shall not have disapproved, in writing or otherwise, the transactions contemplated by this Agreement
and the issuance and delivery of the Exchange Shares pursuant to terms set forth in this Agreement.

 

		6.	TERMINATION.

 

In the event that the Closing
shall not have occurred by on or before five (5) Business Days from the date hereof, due to the Company’s or the Holder’s
failure to satisfy the conditions set forth in Sections 4 and 5 hereof (and the nonbreaching party’s failure to waive such
unsatisfied conditions(s)), the nonbreaching party shall have the option to terminate this Agreement with respect to such breaching
party at the close of business on such date by delivering a written notice to that effect to the other party to this Agreement
and without liability of such party to the other party. Upon such termination, the terms hereof shall be null and void.

 

    	16

    	 

    

 

		7.	MISCELLANEOUS.

 

(a)         Governing Law;
Jurisdiction; Jury Trial. All questions concerning the construction, validity, enforcement and interpretation of this Agreement
shall be governed by the internal laws of the State of New York, without giving effect to any choice of law or conflict of law
provision or rule (whether of the State of New York or any other jurisdictions) that would cause the application of the laws of
any jurisdictions other than the State of New York. Each party hereby irrevocably submits to the exclusive jurisdiction of the
state and federal courts sitting in The City of New York, Borough of Manhattan, for the adjudication of any dispute hereunder or
in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees
not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court,
that such suit, action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding is
improper. Each party hereby irrevocably waives personal service of process and consents to process being served in any such suit,
action or proceeding by mailing a copy thereof to such party at the address for such notices to it under this Agreement and agrees
that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be
deemed to limit in any way any right to serve process in any manner permitted by law. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY
RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH
OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.

 

(b)         Counterparts.
This Agreement may be executed in two or more identical counterparts, all of which shall be considered one and the same agreement
and shall become effective when counterparts have been signed by each party and delivered to the other party; provided that a facsimile
signature shall be considered due execution and shall be binding upon the signatory thereto with the same force and effect as if
the signature were an original, not a facsimile signature.

 

(c)         Headings. The
headings of this Agreement are for convenience of reference and shall not form part of, or affect the interpretation of, this Agreement.

 

(d)         Severability.
If any provision of this Agreement is prohibited by law or otherwise determined to be invalid or unenforceable by a court of competent
jurisdiction, the provision that would otherwise be prohibited, invalid or unenforceable shall be deemed amended to apply to the
broadest extent that it would be valid and enforceable, and the invalidity or unenforceability of such provision shall not affect
the validity of the remaining provisions of this Agreement so long as this Agreement as so modified continues to express, without
material change, the original intentions of the parties as to the subject matter hereof and the prohibited nature, invalidity or
unenforceability of the provision(s) in question does not substantially impair the respective expectations or reciprocal obligations
of the parties or the practical realization of the benefits that would otherwise be conferred upon the parties. The parties will
endeavor in good faith negotiations to replace the prohibited, invalid or unenforceable provision(s) with a valid provision(s),
the effect of which comes as close as possible to that of the prohibited, invalid or unenforceable provision(s).

 

    	17

    	 

    

 

(e)         Entire Agreement;
Amendments. This Agreement shall supersede all other prior oral or written agreements among the Holder, the Company, their
Affiliates and persons acting on their behalf with respect to the matters discussed herein and therein, and this Agreement, and
the instruments referenced herein contain the entire understanding of the parties with respect to the matters covered herein and
therein. No provision of this Agreement may be amended other than by an instrument in writing signed by the Company and the Holder,
and any amendment to this Agreement made in conformity with the provisions of this Section 7(e) shall be binding on the Holder
and the Company. No provision hereof may be waived other than by an instrument in writing signed by the party against whom enforcement
is sought. No consideration shall be offered or paid to any Other Holder to amend or consent to a waiver or modification of any
provision of any of the Other Agreements unless the same consideration (other than the reimbursement of legal fees) also is offered
to the Holder.

 

(f)           Notices. Any
notices, consents, waivers or other communications required or permitted to be given under the terms of this Agreement must be
in writing and will be deemed to have been delivered if delivered pursuant to Section 9(f) of the Securities Purchase Agreement.

 

(g)          Successors and
Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and assigns,
including any purchasers of the Warrants.

 

(h)          No Third Party
Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective permitted successors and
assigns, and is not for the benefit of, nor may any provision hereof be enforced by, any other Person.

 

(i)          Survival. The
representations, warranties and covenants of the Company and the Holder contained herein shall survive the Closing and delivery
of the Exchange Shares.

 

(j)          Further Assurances.
Each party shall do and perform, or cause to be done and performed, all such further acts and things, and shall execute and deliver
all such other agreements, certificates, instruments and documents, as any other party may reasonably request in order to carry
out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby.

 

(k)         No Strict Construction.
The language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent, and
no rules of strict construction will be applied against any party.

 

[Signature Page Follows]

 

    	18

    	 

    

 

IN WITNESS WHEREOF,
the Holder and the Company have caused their respective signature pages to this Agreement to be duly executed as of the date first
written above. 

 

	 	COMPANY:
	 	 
	 	REAL GOODS SOLAR, INC.
	 	 	 
	 	By:	
         

	 	 	Name:	 
	 	 	Title:  	 

 

[Signature
Page to Exchange Agreement]

 

    	 

    	 

    

   

IN WITNESS WHEREOF,
the Holder and the Company have caused their respective signature pages to this Agreement to be duly executed as of the date first
written above. 

 

	 	HOLDER:
	 	 
	 	[               ]
	 	 	 
	 	By:	
         

	 	 	Name:	 
	 	 	Title:  	 
	 	 	 
	 	 	Number of Series A Warrants:
	 	 	 	 
	 	 	 
	 	 	Number of Series C Warrants:
	 	 	 
	 	 	 
	 	 	Number of Exchange Shares:
	 	 	

 

	DWAC Instructions:	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 

 

[Signature
Page to Exchange Agreement] 

 

    	 

    	 

    

 

EXHIBIT A

 

EXCHANGE NOTICE

 

TO BE EXECUTED BY THE HOLDER TO RECEIVE EXCHANGE
SHARES 

 

REAL
GOODS SOLAR, INC.

 

The
undersigned holder hereby exercises the right to receive _________________ of the shares of Class A Common Stock, par value $0.0001
per share (“Exchange Shares”) of Real Goods Solar, Inc., a Colorado corporation
(the “Company”) and hereby directs the Company to deliver to the undersigned such number of Exchange Shares,
in each case, in accordance with the terms of that certain Exchange Agreement dated as of June 25, 2015, by and between the Company
and the Holder listed on the signature page attached thereto.

 

Date: _______________ __, ______

 

	

	Name of Registered Holder 	 
	 	 
	By:	 
	 	Name:	 
	 	Title:  	 

 

    	 

    	 

    

 

ACKNOWLEDGMENT

 

The Company hereby acknowledges
this Exchange Notice and hereby directs Computershare Trust Company, N.A. to issue the above indicated number of shares of Common
Stock. 

 

 COMPUTERSHARE
TRUST COMPANY, N.A. 

	 	 	 
	 	By:	 	 
	 	Name:
Title:scty-ex42_6.htm

 

Exhibit 4.2

 

SolarCity Corporation, as Issuer,

-and-

U.S. Bank National Association, as Trustee

 

 

One Hundred-and-Second SUPPLEMENTAL INDENTURE

Dated as of August 10, 2015

to

INDENTURE

Dated as of October 15, 2014

 

 

1.60% Solar Bonds, Series 2015/C78-1

 

 

 

 

 

	
 
	
TABLE OF CONTENTS
	
 

	
 
	
 
	
PAGE

	
ARTICLE 1
DEFINITIONS

	
SECTION 1.01
	
Scope of Supplemental Indenture
	
2

	
SECTION 1.02
	
Definitions
	
2

	
ARTICLE 2
ISSUE, DESCRIPTION, EXECUTION, REGISTRATION AND EXCHANGE OF NOTES

	
 
	
 
	
 

	
SECTION 2.01
	
Title and Terms
	
3

	
SECTION 2.02
	
Depository Global Securities
	
3

	
SECTION 2.03
	
Payments
	
3

	
ARTICLE 3
SURVIVOR’S OPTION

	
 
	
 
	
 

	
SECTION 3.01
	
Survivor’s Option
	
3

	
 
	
 
	
 

	
ARTICLE 4
MISCELLANEOUS PROVISIONS

 

	
SECTION 4.01
	
Trustee Acceptance
	
5

	
SECTION 4.02
	
Governing Law
	
5

	
SECTION 4.03
	
Trust Indenture Act
	
5

	
SECTION 4.04
	
Execution in Counterparts
	
5

	
SECTION 4.05
	
Severability
	
5

	
SECTION 4.06
	
Appointment of Paying Agent, Security Registrar and Place of Payment
	
5

	
SECTION 4.07
	
Ratification of Original Indenture
	
6

	
EXHIBIT

	
Exhibit A
	
Form of Note
	
A-1

 

 

i

 

 

One Hundred-and-Second SUPPLEMENTAL INDENTURE, dated as of August 10, 2015 (the “Supplemental Indenture”), between SolarCity Corporation, a Delaware corporation (hereinafter called the “Company”), having its principal executive office located at 3055 Clearview Way, San Mateo, California, 94402, and U.S. Bank National Association, a national banking association duly organized and existing under the laws of the United States of America, as trustee (in such capacity, the “Trustee”), to the indenture, dated as of October 15, 2014, between the Company and the Trustee (as amended or supplemented from time to time in accordance with the terms thereof, the “Original Indenture”).

RECITALS OF THE COMPANY

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

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

WHEREAS, the Board of Directors and the Offering Committee thereof have duly adopted resolutions authorizing the Company to execute and deliver this Supplemental Indenture;

WHEREAS, pursuant to the terms of the Original Indenture, the Company desires to establish a new series of its Securities to be known as its 1.60% Solar Bonds, Series 2015/C78-1 (the “Notes”), the form and substance of such Notes and the terms, provisions and conditions thereof to be set forth as provided in the Original Indenture and this Supplemental Indenture;

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

WHEREAS, the Company has requested that the Trustee execute and deliver this Supplemental Indenture, and all requirements necessary to make (i) this Supplemental Indenture a valid instrument in accordance with its terms, and (ii) the Notes, when executed by the Company and authenticated and delivered by the Trustee, the valid obligations of the Company, in each case, have been performed, and the execution and delivery of this Supplemental Indenture have been duly authorized in all respects.

NOW, THEREFORE, THIS SUPPLEMENTAL INDENTURE WITNESSETH, for and in consideration of the premises and the purchases of the Notes by the Holders thereof, it is mutually agreed, for the benefit of the Company and the equal and proportionate benefit of all Holders of the Notes, as follows:

 

 

Article 1
DEFINITIONS

SECTION 1.01  Scope of Supplemental Indenture.  The changes, modifications and supplements to the Original Indenture effected by this Supplemental Indenture shall be applicable only with respect to, and shall only govern the terms of (and only the rights of the Holders and the obligations of the Company with respect to), the Notes, which may be issued from time to time, and shall not apply to any other Securities that may be issued under the Original Indenture (or govern the rights of the Holders or the obligations of the Company with respect to any other such Securities) unless a supplemental indenture with respect to such other Securities specifically incorporates such changes, modifications and supplements.  The provisions of this Supplemental Indenture shall supersede any corresponding or conflicting provisions in the Original Indenture.  If Notes are not authenticated on the Issue Date (as defined in Section 1.02 below), this Supplemental Indenture shall be null and of no effect.

SECTION 1.02  Definitions.  For all purposes of the Indenture, except as otherwise expressly provided or unless the context otherwise requires:

(i) the terms defined in this Article 1 shall have the meanings assigned to them in this Article 1 and include the plural as well as the singular;

(ii) all words, terms and phrases defined in the Original Indenture (but not otherwise defined herein) shall have the same meanings as in the Original Indenture;

(iii) all other terms used herein that are defined in the Trust Indenture Act, either directly or by reference therein, shall have the meanings assigned to them in the Trust Indenture Act;

(iv) all accounting terms not otherwise defined herein shall have the meanings assigned to them in accordance with generally accepted accounting principles, and, except as otherwise herein expressly provided, the term “generally accepted accounting principles” with respect to any computation required or permitted hereunder shall mean such accounting principles as are generally accepted at the date of this instrument; and

(v) the words “herein,” “hereof” and “hereunder” and other words of similar import refer to this Supplemental Indenture as a whole and not to any particular Article, Section or other subdivision.

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

“DTC” means The Depository Trust Company.

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

“Indenture” means the Original Indenture, as originally executed and as supplemented from time to time by one or more indentures supplemental thereto, including this Supplemental Indenture, entered into pursuant to the applicable provisions of the Indenture, including, for all 

2

 

 

purposes of this instrument and any such supplemental indenture, the provisions of the Trust Indenture Act that are deemed to be a part of and govern the Original Indenture and this Supplemental Indenture.

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

“Interest Payment Date” means February 15 and August 15 of each year, beginning on February 15, 2016.

“Issue Date” means August 20, 2015 or such other date as the Company may identify in a written notice to the Trustee.

“Note” or “Notes” has the meaning specified in the fourth paragraph of the recitals of this Supplemental Indenture, and shall include any Additional Notes issued pursuant to Section 2.01.

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

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

“Regular Record Date” for the interest payable on any Interest Payment Date means the fifteenth day prior to such Interest Payment Date (whether or not a Business Day).

“Stated Maturity” means, with respect to the payment of principal on the Notes, August 20, 2016.

“Supplemental Indenture” has the meaning specified in the first paragraph hereof.

Article 2
ISSUE, DESCRIPTION, EXECUTION, REGISTRATION AND EXCHANGE OF NOTES

SECTION 2.01  Title and Terms. There is hereby established a series of Securities designated the “1.60% Solar Bonds, Series 2015/C78-1”.  The aggregate principal amount of the Notes shall not be limited and shall be initially authenticated and delivered from time to time upon delivery to the Trustee of the documents required by Section 303 of the Indenture.  The Notes shall be issued only in fully registered form, in denominations of $1,000 and any integral multiples thereof.  Up to $5,000,000 aggregate principal amount of Notes will be authenticated on the Issue Date (the “Initial Notes”).

The Company may, without the consent of the Holders of the Notes, hereafter issue additional Notes (“Additional Notes”) under the Indenture with the same terms and conditions, except for any difference in the issue price, Issue Date and interest accrued prior to the issue date of the Additional Notes, as the Initial Notes, in an unlimited aggregate principal amount.  Any such Additional Notes shall constitute a single series together with the Initial Notes for all purposes hereunder, including, without limitation, for purposes of any waivers, supplements or 

3

 

 

amendments to the Indenture requiring the approval of Holders of the Notes and any offers to purchase the Notes.

SECTION 2.02  Depository Global Securities.  The Notes initially shall be represented by one or more permanent Depository Global Securities and registered in the name of Cede & Co., the nominee of DTC.  The Form of Note shall be substantially as set forth in Exhibit A, which is incorporated into and shall be deemed a part of this Supplemental Indenture, with such appropriate insertions, omissions, substitutions and other variations as are required or permitted by the Indenture, and may have such letters, numbers or other marks of identification and such legends or endorsements placed thereon as may be required to comply with the rules of any securities exchange or as may, consistently herewith, be determined to be necessary or appropriate by the Officers of the Company executing such Notes, as evidenced by their execution of the Notes.  Each Depository Global Security shall be duly executed by the Company and authenticated and delivered by the Trustee, and shall be retained by the Trustee, as custodian for DTC, at its Corporate Trust Office.  The aggregate principal amount of the Depository Global Notes may from time to time be increased or decreased by adjustments made on the records of the Trustee, as custodian, and of DTC or its nominee, as hereinafter provided.

SECTION 2.03  Payments.  The principal amount of Notes then Outstanding shall be payable at the Stated Maturity.  Interest on the Notes shall accrue at a rate of 1.60% per annum, from and including the Issue Date with respect to such Notes, or from the most recent date on which interest has been paid or duly provided for with respect to such Notes, to, but excluding, the next Interest Payment Date, until the principal thereof is paid or made available for payment.  Interest shall be payable in arrears on each Interest Payment Date, beginning on February 15, 2016, to the Persons in whose name a Note is registered at the Close of Business on the Regular Record Date immediately preceding the applicable Interest Payment Date.  If any Stated Maturity or Maturity of, or any other day on which a payment is due shall be a day which is not a Business Day, then such payment may be made on the next succeeding day that is a Business Day with the same force and effect as if made at the Stated Maturity or Maturity or on any such other payment date, as the case may be, and no interest shall accrue on the amount payable on such date or at such time for the period from and after such Stated Maturity, Maturity or other payment date, as the case may be, to the next succeeding Business Day.  Interest will be computed on the basis of twelve 30-day months and a 360-day year. The amount of interest payable for any period shorter than a full semi-annual interest period will be computed on the basis of the number of days elapsed in a 180-day semi-annual period of six 30-day months. 

The Paying Agent shall (upon receipt of sufficient immediately available funds from the Company) pay the principal of and interest on any Note in immediately available funds to the registered holder thereof (which shall be DTC or its nominee or any other depository, in the case of Depository Global Securities).  All payments on the Notes will be made in US. Dollars or in such other coin or currency of the United States of America as of the time of payment is legal tender for the payment of public and private debts. 

Article 3
SURVIVOR’S OPTION

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SECTION 3.01  Survivor’s Option.  The Notes shall contain a provision that provides for the optional repayment of the Notes prior to their Stated Maturity, if requested by the authorized representative of the beneficial owner of those Notes (the “Representative”), following the death of the beneficial owner (a “Survivor’s Option”), so long as the Notes were owned by the beneficial owner or his or her estate at least six months prior to the request and certain documentation requirements are satisfied; provided, however, that if the terms of any such Note conflict with any provision of this Article 3, the terms of such Note shall govern.  Pursuant to the valid exercise of the Survivor’s Option, the Company shall repay any Note (or portion thereof) properly tendered for repayment by the Representative under the laws of the appropriate jurisdiction (including, without limitation, the personal representative or executor of the deceased beneficial owner or surviving joint owner with such deceased beneficial owner) at a price equal to 100% of the principal amount of the deceased beneficial owner’s beneficial interest in such Note plus accrued and unpaid interest to, but not including, the date of such repayment (or at a price equal to the amortized face amount for Original Issue Discount Securities on the date of such repayment), subject to certain limitations.  Any Note (or portion thereof) tendered pursuant to a valid exercise of the Survivor’s Option may not be withdrawn.

The Company has the discretionary right to limit the aggregate principal amount of Notes as to which exercises of the Survivor’s Option shall be accepted by the Company from the Representatives of all deceased beneficial owners in any calendar year to an amount equal to the greater of $1,000,000 or 1% of the principal amount of all the Notes outstanding as of the end of the most recent calendar year.  The Company also has the discretionary right to limit to $250,000 in any calendar year the aggregate principal amount of Notes as to which exercises of the Survivor’s Option shall be accepted by the Company from the Representative of any individual deceased beneficial owner of Notes in such calendar year.  The Company may also limit the exercise of the Survivor’s Option to principal amounts of $1,000 and integral multiples of $1,000.  Each of these limitations is referred to herein as a “Put Limitation.”

The death of a person holding a beneficial interest in a Note as a joint tenant or tenant by the entirety with another person, or as a tenant in common with the deceased holder’s spouse, will be deemed to be the death of the beneficial owner of the Note, and the entire principal amount of the Note so held shall be subject to repayment.  However, the death of a person holding a beneficial interest in a Note as tenant in common with a person other than such deceased holder’s spouse will be deemed to be the death of a beneficial owner only with respect to the deceased person’s interest in the Note, and only the deceased beneficial owner’s percentage interest in the principal amount of the Note will be subject to repayment to the estate of the deceased beneficial owner upon application of the applicable Representative.

The death of a person who, during his or her lifetime, was entitled to substantially all of the beneficial interests of ownership of a Note will be deemed to be the death of the beneficial owner of such Note for purposes of this provision, regardless of whether such beneficial owner was the registered holder of the Note, if such beneficial interest can be established to the satisfaction of the Trustee and the Company.  Such beneficial ownership interest will be deemed to exist in typical cases of nominee ownership, ownership under the Uniform Transfers to Minors Act or Uniform Gifts to Minors Act, community property or other joint ownership arrangements between spouses.  In addition, the beneficial ownership interest will be deemed to 

5

 

 

exist in custodial and trust arrangements where one person has all of the beneficial ownership interest in the Note during his or her lifetime.

Tenders of Notes (or portion thereof) pursuant to valid exercises of the Survivor’s Option shall be accepted in the order all such Notes are received by the Trustee, except for any Note (or portion thereof) the acceptance of which would contravene a Put Limitation, if applied.  If, as of the end of any calendar year, the aggregate principal amount of Notes (or portions thereof) that have been tendered pursuant to the valid exercise of the Survivor’s Option during such year has exceeded a Put Limitation, any exercise(s) of the Survivor’s Option with respect to Notes (or portions thereof) not accepted during such calendar year because such acceptance would have contravened such Put Limitation, if applied, shall be deemed to be tendered in the following calendar year in the order such Notes (or portions thereof) were originally tendered.  Any Note (or portion thereof) accepted for repayment pursuant to exercise of the Survivor’s Option shall be repaid on the first Interest Payment Date that occurs 30 or more calendar days after the date of acceptance. In the event that a Note (or any portion thereof) tendered for repayment pursuant to a valid exercise of the Survivor’s Option is not accepted, the Trustee shall deliver a notice, by first-class mail to the applicable Representative, that states the reason such Note (or portion thereof) has not been accepted for payment.

Subject to the foregoing, in order for a Survivor’s Option to be validly exercised, the Trustee and the Company must receive from the applicable Representative:  (i) a written request for repayment signed by such Representative, and such signature must be guaranteed by a member firm of a registered national securities exchange or of the Financial Industry Regulatory Authority, Inc. or a commercial bank or trust company having an office or correspondent in the United States or medallion guaranteed by a savings bank or credit union; (ii) as applicable, tender of the Note to be repaid; (iii) appropriate evidence that (A) the deceased was the beneficial owner of the Note at the time of death and the interest in such Note was owned by the deceased beneficial owner or his or her estate at least six months prior to the request for repayment, (B) the death of such beneficial owner has occurred and the date of such death and (C) such Representative has authority to act on behalf of the deceased beneficial owner; (iv) if applicable, a properly executed assignment or endorsement; (v) if the interest in such Note is held by a nominee, trustee, custodian or other person in a similar capacity of the deceased beneficial owner, a certificate satisfactory to the Trustee and the Company from such nominee, trustee, custodian or similar person attesting to the deceased’s beneficial ownership in such Note; (vi) tax waivers and such other instruments or documents that the Trustee and the Company reasonably require in order to establish the validity of the beneficial ownership of the Notes and the claimant’s entitlement to payment; and (vii) any additional information the Trustee or the Company reasonably requires to evidence satisfaction of any conditions to the exercise of the Survivor’s Option or to document beneficial ownership or authority to make the election and to cause the repayment of the Notes.  

For Notes represented by a Depository Global Security, the Depository or its nominee shall be the holder of such Note and therefore shall be the only entity that can exercise the Survivor’s Option for such Note.  To obtain repayment pursuant to exercise of the Survivor’s Option with respect to such Note, the Representative must provide to the broker or other entity through which the beneficial interest in such Note is held by the deceased beneficial owner:  (i) a written instruction to such broker or other entity to notify the Depository of the Representative’s 

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desire to obtain repayment pursuant to exercise of the Survivor’s Option; (ii) the documents referenced above in the preceding paragraph; (ii) a certificate satisfactory to the Trustee and the Company from such broker or other entity stating that it represents the deceased beneficial owner; and (iii) a detailed description of the Note, including CUSIP, interest rate, and Maturity Date.  Such broker or other entity shall be responsible for disbursing any payments it receives pursuant to exercise of the Survivor’s Option to the appropriate Representative.

Subject to the Company’s right hereunder with respect to any Put Limitation, and provided that the requisite items above are in fact received by the Trustee, the Trustee shall be entitled to fully rely, and shall have no liability in relying, on the information supplied by a broker, the Representative or other entity with respect to the above and/or in processing the exercise of the Survivor’s Option.  All questions as to the eligibility or validity of any exercise of the Survivor’s Option will be determined by the Company, in its sole discretion, which determination shall be final and binding on all parties, and the Trustee shall be entitled to fully rely upon the Company’s determination as to the eligibility or validity of any exercise of a Survivor’s Option and shall not be liable with respect to the acceptance or rejection of any exercise of the Survivor’s Option.

Article 4
MISCELLANEOUS PROVISIONS

SECTION 4.01  Trustee Acceptance.  The Trustee has accepted the supplement of the Original Indenture effected by this Supplemental Indenture and agrees to execute the trust created by the Original Indenture as hereby supplemented, but only upon the terms and conditions set forth in the Indenture, including the terms and provisions defining and limiting the liabilities and responsibilities of the Trustee, and without limiting the generality of the foregoing, the Trustee shall not be responsible in any manner whatsoever for or with respect of any of the recitals or statements contained herein, all of which recitals or statements are made solely by the Company, or for or with respect to (a) the validity or sufficiency of this Supplemental Indenture or any of the terms or provisions hereof, (b) the proper authorization hereof by the Company by corporate action or otherwise, and (c) the due execution hereof by the Company.

SECTION 4.02  Governing Law.  This Supplemental Indenture and the Notes shall be governed by, and construed in accordance with, the laws of the State of New York.

SECTION 4.03  Trust Indenture Act.  This Supplemental Indenture will be subject to, and governed by, the provisions of the Trust Indenture Act that are required to be part of this Supplemental Indenture and shall, to the extent applicable, be governed by such provisions.

SECTION 4.04  Execution in Counterparts.  This Supplemental Indenture may be executed in any number of counterparts, each of which shall be an original, but such counterparts shall together constitute but one and the same instrument.

SECTION 4.05  Severability.  In case any provision in this Supplemental Indenture or in the Notes shall be invalid, illegal or unenforceable, then (to the extent permitted by law) the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

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SECTION 4.06  Appointment of Paying Agent, Security Registrar and Place of Payment.  The Company initially appoints the Trustee to act as Paying Agent and Security Registrar for the Notes, subject to and in accordance with the terms and conditions set forth herein and in the Original Indenture.  The Trustee shall have all of the rights, benefits and immunities of a Paying Agent and Security Registrar as set forth herein and therein.  The Company initially designates the Corporate Trust Office of the Trustee as the Place of Payment for the Notes and the office or agency described in Section 902 of the Original Indenture and initially designates DTC as the Depositary for the Notes.  The Company may change the Paying Agent or the Security Registrar without prior notice to or consent of the Holders, and the Company or any of its subsidiaries may act as Paying Agent or Security Registrar.

SECTION 4.07 Ratification of Original Indenture.  The Original Indenture, as supplemented by this Supplemental Indenture, is in all respects ratified and confirmed, and this Supplemental Indenture shall be deemed part of the Original Indenture in the manner and to the extent herein and therein provided.  For the avoidance of doubt, each of the Company and each Holder of the Notes, by its acceptance of such Notes, acknowledges and agrees that all of the rights, privileges, protections, immunities and benefits afforded to the Trustee and the Paying Agent under the Original Indenture are deemed to be incorporated herein, and shall be enforceable by the Trustee and the Paying Agent hereunder, as if set forth herein in full.

U.S. Bank National Association hereby accepts the trusts in this Supplemental Indenture declared and provided, upon the terms and conditions herein above set forth.

[Remainder of the page intentionally left blank]

 

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

SOLARCITY CORPORATION

		
	
By:
	
/s/ Brad Buss

	
 
	
Name: Brad Buss

	
 
	
Title: Chief Financial Officer

 

U.S. BANK NATIONAL ASSOCIATION, as Trustee 

		
	
By:
	
/s/ K. Wendy Kumar

	
 
	
Name: K. Wendy Kumar

	
 
	
Title: Vice President

 

 

 

 

Exhibit A

Form of Note

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO SOLARCITY CORPORATION OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

A-1

FORM OF GLOBAL NOTE

 

SOLARCITY CORPORATION
1.60% Solar Bonds, Series 2015/C78-1

	
 
	
 
	
CUSIP:  83417KDF2

	
 
	
 
	
 

	
No. 1
	
 
	
Principal Amount (US)

	
 
	
 
	
$__________

	
 
	
 
	
(as revised by the Schedule of Increases and Decreases in Global Note attached hereto)

 

SolarCity Corporation, a Delaware corporation (herein called the “Company,” which term includes any successor Person under the Indenture referred to on the reverse hereof), for value received hereby promises to pay to CEDE & CO., the registered Holder hereof, or registered assigns, the principal sum of ____________________________ Dollars ($_______) (as revised by the Schedule of Increases and Decreases in Global Note attached hereto), on August 20, 2016 (or such portion thereof as may be payable on the date of repayment by the Company prior to the Stated Maturity pursuant to the valid exercise of the Survivor’s Option) at the office or agency of the Company maintained for that purpose in accordance with the terms of the Indenture, in such coin or currency of the United States of America as at the time of payment shall be legal tender for the payment of public and private debts, and to pay interest, semiannually, on February 15 and August 15 of each year (each, an “Interest Payment Date”), commencing on February 15, 2016, on said principal sum at said office or agency, in like coin or currency, at the rate per annum of 1.60%, from and including the most recent Interest Payment Date in respect of which interest has been paid (or, with respect to the initial Interest Payment Date for any Note, or portion thereof, from and including the date of issuance of the Note, or portion thereof).  If any Stated Maturity or Maturity of, or any other day on which a payment is due shall be a day which is not a Business Day, then such payment may be made on the next succeeding day that is a Business Day with the same force and effect as if made at the Stated Maturity or Maturity or on any such other payment date, as the case may be, and no interest shall accrue on the amount payable on such date or at such time for the period from and after such Stated Maturity, Maturity or other payment date, as the case may be, to the next succeeding Business Day.  Interest will be computed on the basis of twelve 30-day months and a 360-day year. The amount of interest payable for any period shorter than a full semi-annual interest period will be computed on the basis of the number of days elapsed in a 180-day semi-annual period of six 30-day months.

Reference is made to the further provisions of this Note set forth on the reverse hereof.  Such further provisions shall for all purposes have the same effect as though fully set forth at this place.

This Note shall not be valid or become obligatory for any purpose until the certificate of authentication hereon shall have been manually signed by the Trustee or other duly authorized Authenticating Agent under the Indenture.

A-2

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

Dated: 

	
 
	
 
	
SOLARCITY CORPORATION

	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
 
	
By:
	
 

	
 
	
 
	
 
	
Name:  Brad Buss

	
 
	
 
	
 
	
Title:  Chief Financial Officer

 

 

	
ATTEST:
	
 

	
 
	
 

	
 
	
 

	
By
	
 
	
 

	
 
	
Name:  Seth Weissman
	
 

	
 
	
Title:  Secretary
	
 

 

 

A-3

TRUSTEE’S CERTIFICATE OF AUTHENTICATION

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

U.S. BANK NATIONAL ASSOCIATION 
as Trustee

	
By:
	
 
	
 

	
 
	
Authorized Signatory 
	
 

 

A-4

FORM OF REVERSE OF NOTE
SOLARCITY CORPORATION
1.60% Solar Bonds, Series 2015/C78-1

This note is one of a duly authorized issue of notes of the Company, designated as its “1.60% Solar Bonds, Series 2015/C78-1” (herein called the “Notes”), issued under and pursuant to an Indenture, dated as of October 15, 2014 (the “Original Indenture”), between the Company and U.S. Bank National Association, as trustee (in such capacity, the “Trustee”), as supplemented with respect to the Notes by the One Hundred-and-Second Supplemental Indenture, dated as of August 10, 2015 (the “Supplemental Indenture,” and together with the Original Indenture, the “Indenture”), between the Company, as issuer, and the Trustee, as trustee and as the authenticating agent, paying agent and security registrar (herein called the “Authenticating Agent,” “Paying Agent” and “Security Registrar”), to which Indenture and all indentures supplemental thereto reference is hereby made for a description of the rights, limitations of rights, obligations, duties and immunities thereunder of the Trustee, Authenticating Agent, Paying Agent, Security Registrar, the Company and the Holders of the Notes.  Capitalized terms used but not otherwise defined in this Note shall have the respective meanings ascribed thereto in the Indenture.

This Note shall be repayable at the option of the Holder prior to its Stated Maturity if properly exercised pursuant to the Survivor’s Option.  In the event of repayment of a Note, in whole or in part, annotation of such repayment shall be made by the Trustee on the Schedule of Increases and Decreases in Global Note.

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

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

The Indenture contains provisions permitting the Company and the Trustee, with the consent of the Holders of not less than a majority in aggregate principal amount of the Notes at the time Outstanding, to execute supplemental indentures to modify provisions of the Indenture, subject to exceptions permitting the modification of the Indenture without the consent of any Holder of Notes or requiring the consent of each Holder of a Note affected by such modification all as set forth in the Indenture.

A-5

The Notes are issuable in fully registered form, without coupons, in denominations of $1,000 principal amount and any integral multiples thereof.  The Notes may be exchanged for a like aggregate principal amount of Notes of any other authorized denominations, on the terms and subject to the conditions and limitations set forth in the Indenture.

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

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

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

A-6

 

Schedule of Increases and Decreases in Global Note

 

SOLARCITY CORPORATION
1.60% Solar Bonds, Series 2015/C78-1

The following increases or decreases in this Note have been made:

 

	
Date of Increase or Decrease
	
Amount of Increase in Principal Amount of This Note
	
Amount of Decrease in Principal Amount of This Note
	
Principal Amount of This Note Following Such Increase or Decrease
	
Signature of Authorized Signatory of Trustee or Security Custodian

	
 
	
 
	
 
	
 
	
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

A-7

ASSIGNMENT

 

FOR VALUE RECEIVED, the undersigned assigns and transfers this Note to:

 

________________________________________________________________________

 

________________________________________________________________________

(Insert assignee’s social security or tax identification number)

 

 

________________________________________________________________________

 

________________________________________________________________________

 

________________________________________________________________________

(Insert address and zip code of assignee)

 

and irrevocably appoints ____________________________ as agent to transfer this Note on the Security Register.  The agent may substitute another to act for him or her.

 

 

		
	
Dated: 
	
Signature:

	
 
	
 

	
 
	
Signature Guarantee:

 

(Sign exactly as your name appears on the other side of this Note)

 

Signatures must be guaranteed by an “eligible guarantor institution” meeting the requirements of the Security Registrar, which requirements include membership or participation in the Security Transfer Agent Medallion Program (“STAMP”) or such other “signature guarantee program” as may be determined by the Security Registrar in addition to, or in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended.

 

A-8

 

FORM OF NOTICE OF ELECTION TO EXERCISE SURVIVOR’S OPTION

 

By checking this box, the undersigned represents that:  (1) it is the authorized representative of the deceased beneficial owner identified below; (2) (a) the deceased was the beneficial owner of the principal amount of the SolarCity Corporation 1.60% Solar Bonds, Series 2015/C78-1 (the “Notes”) listed below at the date of his or her death and the Notes have been held by the deceased beneficial owner or his or her estate for at least six-months, (b) the death of the beneficial owner listed below has occurred and (c) the undersigned representative has authority to act on behalf of the deceased beneficial owner; (3) it hereby elects to tender the principal amount of Notes set forth below for repayment by SolarCity Corporation for a price equal to 100% (or such lesser amount as may be accepted for payment) of the principal amount of the beneficial interest of the deceased owner plus accrued interest to the date of repayment; and (4) it acknowledges that SolarCity Corporation’s acceptance of the election submitted hereby is subject to, in SolarCity Corporation’s sole discretion, certain aggregate limitations on the amount of Notes that shall be accepted by SolarCity Corporation from authorized representatives of all deceased beneficial owners in any calendar year.

 

The deceased beneficial owner held the principal amount of Notes to be tendered as (check one):

 

___ a sole beneficial owner, a joint tenant or a tenant by the entirety with another or others, a tenant in common with a spouse or an individual entitled to substantially all of the beneficial interest

___ a tenant in common with another (other than a spouse).  If applicable, please provide the amount of interest held by the deceased beneficial owner.  $_______________________

 

Full Name of deceased beneficial owner (please attach death certificate):

 

_____________________________________________________________________________

 

 

If applicable, full name of the nominee of the deceased beneficial owner (please attach a certificate attesting to the deceased’s ownership of the beneficial interest in the notes):

 

_____________________________________________________________________________

 

 

Signature Guarantee: ___________________________________________________________

 

Participant in a recognized Signature Guarantee

Medallion Program (or other signature guarantor

program reasonably acceptable to the Trustee and SolarCity Corporation)

 

Principal amount of Notes being tendered for repayment (only principal amounts of $1,000 and integral multiples of $1,000):  $__________________________________________________________

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SolarCity Corporation may, in its sole discretion, limit the aggregate principal amount of Notes that shall be accepted by it from authorized representatives of all deceased beneficial owners in any calendar year to an amount equal to the greater of $1,000,000 or 1% of the principal amount of all the Solar Bonds outstanding as of the end of the most recent calendar year.  SolarCity Corporation also has the discretionary right to limit to $250,000 in any calendar year the aggregate principal amount of Solar Bonds as to which exercises of the Survivor’s Option shall be accepted by us from the authorized representative of any individual deceased beneficial owner of Solar Bonds in such calendar year.  Additional tender limitations and terms of acceptance are also applicable and are more fully described in the One Hundred-and-Second Supplemental Indenture dated August 10, 2015 and the Program Supplement dated March 9, 2015 to the Prospectus dated October 15, 2014.  The Trustee, on behalf of and at the direction of SolarCity Corporation, has the right to reject tenders of Notes if a properly executed election is not submitted or if it fails to receive any tax or additional information that is required to document adherence to any conditions precedent, ownership or authority to make the election.

THIS NOTICE OF ELECTION MAY NOT BE WITHDRAWN

 

 

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