Document:

Terms and Conditions
of the

 

 

 

Nokia Performance
Share Plan 2020

 

 

 

 

Approved by the Board
of Directors on

March 5, 2020, amended on July 20, 2020 and on October 6, 2020

 

 

 

 

 

 

 

 

 

    	 	 	 

     

    

 

TERMS AND CONDITIONS OF THE NOKIA PERFORMANCE
SHARE PLAN 2020

 

		1.	Purpose and Scope of the
Plan

		1.1.	The purpose of the Nokia
Performance Share Plan 2020 is to retain Nokia Group employees, to promote employees’ engagement and to reward them for Nokia
Group’s long-term performance. This is accomplished by focusing the Participants on Nokia Group’s long-term financial
performance and share price appreciation and thus aligning the interests of the Participants with those of the shareholders. To
accomplish these objectives the Company may award eligible Nokia Group employees Performance Shares under this Plan. 

		1.2.	The Plan is tied directly
to the performance of Nokia Group. For the purposes of this plan, performance is measured through the Performance Criterion. The
financial benefits of the Plan materialize if the performance levels measured by Performance Criterion are achieved by the end
of the Plan Period. 

		1.3.	The Grant of Performance
Shares under the Plan may result in the settlement of a maximum of 88 million Shares. The Board determines the general principles
of the Plan and approves the Grants of Performance Shares to eligible employees within its authority. Grants of Performance Shares
under these Terms & Conditions may be made between March 5, 2020 and December 31, 2020, inclusive. 

 

		2.	Definitions

 

Baseline
Share Price: The average closing share price for Nokia shares on NASDAQ Helsinki during the
five trading days immediately prior to the Grant Date.

Board:
The Board of Directors of the Company.

Company:
Nokia Corporation.

Delivery
Date: the date Shares are delivered to a Participant; the date being a Helsinki banking date
chosen by the Company which falls after the date the Board approves the outcome of measuring the satisfaction of the applicable
Performance Criterion following the end of the Plan Period.

Grant:
The awarding of Performance Shares to an employee of Nokia in accordance with the Plan.

Grant
Amount: The number of Performance Shares Granted to a Participant.

Grant
Date: The date on which the Grant of Performance Shares is formally made. 

Maximum
Number: The number of Performance Shares to be delivered if the maximum performance is achieved
with respect to the Performance Criterion as defined under rule 4. The Maximum Number equals two times the Grant Amount.

Nokia:
Nokia Corporation.

Nokia
Group: The Company together with the companies over which the Company effectively exercises
control and which are included in the consolidated financial statements of the Company.

Participant:
Employee of the Nokia Group who has received a Grant of Performance Shares under the Plan.

Performance
Criterion: Performance is measured by reference to the Total Shareholder Return (TSR) for
Nokia during the Plan Period, as determined by the Board. 

    	 	 	 

     

    

 

TSR is defined
as the share price growth for Nokia shares on NASDAQ Helsinki over the Baseline Share Price at the end of the Plan Period, plus
any dividends declared during this period.

Plan
Period: The Plan Period shall start on the Grant Date and end no less than three years following
that date. Subject to rule 7, a Participant shall forfeit their Performance Shares if their last day of employment with the Nokia
Group occurs before the last day of the Plan Period.

Performance
Share/Shares: Each Performance Share represents a right to receive a certain number of Shares
or their cash equivalent upon delivery, subject to the fulfilment of the conditions under rule 4, and provided that no other restriction
related to these Terms & Conditions is applicable.

Plan:
Performance Share Plan 2020 of the Company.

Share/Shares:
The Company’s ordinary shares. The terms and conditions applicable to Shares shall apply to their
cash equivalent used for delivery, as applicable.

Terms
& Conditions: The terms and conditions of this Plan.

 

		3.	Grant
of Performance Shares

 

		3.1.	On the Grant Date, each
Participant is offered a Grant Amount of Performance Shares. The Company will notify each Participant of the Grant, the Grant Amount,
the applicable Performance Criterion and Plan Period.

 

		3.2.	As a precondition for a
valid Grant, the Participant must be employed by Nokia Group at the time of the Grant. 

 

		3.3.	The Participant may be required
to give the Company such authorizations and consents, as the Company deems necessary in order to administer the Plan. 

 

		4.	Financial
Performance Criterion

 

		4.1.	The number of Performance
Shares to be delivered is determined in respect of the Performance Criterion.

 

		4.2.	A Baseline Share Price,
an absolute target and a Maximum performance level shall be set for the Performance Criterion, as determined by the Board.

 

		4.3.	To the extent the Baseline
Share Price is exceeded, the number of Performance Shares to be delivered on Delivery Date will increase from 0%, up to the Maximum
Number, following a linear scale based on actual performance level achieved.

 

		4.4.	The total number of Performance
Shares to be delivered may not exceed two times the Grant Amount. 

 

		5.	Measurement
and Calculation of Pay-out

 

		5.1.	The measurement of the Performance
Criteria shall be made by the Board in its sole discretion after the end of the Plan Period, upon the recommendation of the Personnel
Committee of the Board. 

 

		5.2.	Based
on the Board’s measurement, the number of Performance Shares to be delivered as Shares or the equivalent amount of cash shall
be calculated.

 

    	 	 	 

     

    

 

		5.3.	The calculation of the number
of Performance Shares to be delivered shall not result in fractional Shares. The number of Shares shall be rounded to the nearest
whole Share.

 

 

		6.	SHARE
DELIVERY 

 

		6.1.	Until the Delivery Date,
the Participant does not have any legal ownership or any other rights relating to the Shares. The Participant shall not be entitled
to any dividend or have any voting rights or any other rights as a shareholder to the Shares until and unless the Shares have been
transferred to the Participant and, in case of new Shares issued by the Company, until the Shares have been entered in the Trade
Register. 

 

		6.2.	The Company will complete
the delivery by transferring the applicable number of Shares or their cash equivalent to the Participant’s book-entry, brokerage
or other account, as applicable on the Delivery Date. 

 

		6.3.	Completion of share delivery
is dependent on the Participant’s compliance with these Terms & Conditions and all necessary instructions and actions
to enable the Company to facilitate the delivery. If the Participant has not performed all necessary actions to enable the Company
to complete the delivery, the Company will consider, in its sole discretion, what appropriate action to take. 

 

		6.4.	The Company may, in its
sole discretion, use one or more of the following instruments to settle Performance Shares: newly issued Shares, the Company’s
own existing Shares (treasury Shares), Shares purchased from the open market, or, in lieu of Shares, cash. 

 

		6.5.	The Participants shall not
be entitled to any dividend or have any voting rights or any other shareholder rights until and unless the Shares have been transferred
to the Participant and, where new Shares issued by the Company are used for delivery, until the Shares have been entered in the
Trade Register. 

 

		7.	Changes
in Employment 

 

		7.1.	If the Participant’s
last day of employment with the Nokia Group occurs before the end of the Plan Period by the reason of permanent disability (as
defined by the Company in its sole discretion), the Participant retains the right to delivery on the scheduled Delivery Date. 

		7.2.	In the case of death of
the Participant before the end of the Plan Period, unless the Company determines otherwise in its sole discretion, the Performance
Shares will be delivered at the Grant Amount as soon as practicable thereafter. If made, such special delivery will constitute
full and final delivery of that Performance Share Grant.

		7.3.	If the Participant’s
last day of employment with the Nokia Group occurs before the end of the Plan Period for any reason other than those mentioned
above, then, unless the Personnel Committee of the Board, or the Board as applicable, determines otherwise in its sole discretion,
the Company shall redeem the Performance Shares from the Participant without consideration, in which case the Participant shall
not be entitled to any delivery under the Plan.

		7.4.	In cases of voluntary and/or
statutory leave of absence of the Participant, the Company has the right to prorate the delivery.

 

    	 	 	 

     

    

 

		8.	Terms
of Employment 

		8.1.	The Grant or delivery of
Performance Shares does not constitute a term or a condition of the Participant’s employment contract with Nokia Group under
applicable local laws and the rights and obligations arising from a Participant’s employment with Nokia are separate from,
and are not affected by, the Participant’s participation in the Plan. The Performance Shares, Shares or their cash equivalent
under the Plan do not form a part of the Participant’s salary or benefit of any kind.

		8.2.	The Grant or delivery of
Performance Shares does not create any right for that Participant to be offered participation in the Plan in future or to be Granted
any additional Performance Shares on any particular terms, including the number of Performance Shares. 

		8.3.	By Participating in the
Plan, a Participant waives all rights to compensation for any loss in relation to the Plan, including:

		8.3.1.	any loss or reduction of
any rights or expectations under the Plan in any circumstances or for any reason;

		8.3.2.	any exercise of a discretion
or a decision taken in relation to any Performance Shares, and/or to the Plan, or any failure to exercise a discretion or take
a decision; and

		8.3.3.	the operation, suspension,
termination or amendment of the Plan.

 

		9.	Taxes
and other Obligations

		9.1.	The Participant is personally
responsible for all taxes and social security charges associated with the Performance Share Grants and Shares delivered upon delivery.
This includes responsibility for any and all tax liabilities in multiple countries, if applicable. Participants are advised to
consult their own financial and tax advisers (at their own expense) before accepting the Grant in order to verify their tax position.

		9.2.	The Participant is also
personally responsible for any potential charges debited by any plan administrator, broker or financial institution in connection
with the delivery of the Performance Shares or any subsequent transactions related to the Shares. 

		9.3.	Performance Shares must
not be used as security for any liability, be transferred or otherwise disposed of (except in the event of the Participant’s
death, to his personal representatives) and will lapse immediately on any attempt to do so.

		9.4.	Pursuant to applicable laws,
the Nokia Group is, or may be required or may deem it appropriate to withhold taxes, social security charges or fulfil employment
related and other obligations upon Grant or delivery of Performance Shares, or when the Shares are disposed of by a Participant.
The Nokia Group shall have the right to determine how such collection, withholding or other measures will be arranged or carried
out, including but not limited to a delivery of a net amount remaining after the completion of such measures or a potential sale
of the Shares on behalf of a Participant for the completion of such measures.

 

		10.	Breach
of these Terms and Conditions 

		10.1.	The Participant shall comply
with these Terms & Conditions, as well as any instructions given by the Company regarding the Plan from time to time. 

		10.2.	If the Participant breaches
these Terms & Conditions and/or any instructions given by the Company, the Company may in its discretion, at any time prior
to the Delivery Date, rescind the Grant of Performance Shares. 

 

    	 	 	 

     

    

 

		11.	Validity
of these Terms and Conditions and Amendments

		11.1.	These Terms & Conditions
shall become valid and effective upon the approval by the Board.

		11.2.	The Board may, in its absolute
discretion, at any time amend, modify or terminate these Terms & Conditions. 

		11.3.	Action taken by the Board
in rule 11.2 may also, as in each case determined by the Board, affect the Performance Shares that are then outstanding, but not
delivered. 

		11.4.	Notwithstanding rule 11.1,
the definition of Baseline Share Price, Eligibility Date and Plan Period as well as rule 7 for Grants made prior to July 20, 2020
remain as defined in the Plan rules approved by the Board on March 5, 2020 and as communicated to the participants at the time
of Grant. 

 

		12.	Administration

		12.1.	The Plan shall be administered
by the Company. The Company has the authority to interpret these Terms & Conditions, approve such other rules and procedures
and take such other measures, as it deems necessary or appropriate to benefit the administration of the Plan, including, but not
limited to, taking action to take account of a change in legislation or to maintain favourable tax, exchange control or regulatory
treatment for Participants or for Nokia. Such action may also affect the Performance Share Grants that are then outstanding, but
not delivered.

		12.2.	The Company has the right
to determine the practical manner of administration and delivery of the Performance Shares, including but not limited to the acquisition,
issuance, sale, and transfer of the Shares or their cash equivalent to the Participant. Furthermore, the Company has the right
to require from the Participant the submission of such information or contribution that is necessary for the administration and
delivery of the Performance Share Grants. 

		12.3.	Any
notice or other communication in connection with the Plan may be delivered personally or sent by electronic means or post. Where
a notice or other communication is given by post, it will be deemed to have been received 72 hours after it was put into the post
properly addressed and stamped. If a notice or communication is sent by electronic means, it will be deemed to be received immediately
after the communication is sent, on the date and in the time zone where the sender is located.

 

		13.	Rights
of Participants in Corporate Events

		13.1.	Should the Annual General
Meeting in accordance with the proposal of the Board decide, prior to the delivery of the Performance Shares, to distribute a special
dividend constituting a deviation from the customary dividend policy of the Company:

		13.1.1.	the Board may determine,
in its sole discretion if and how the Participants will be compensated for the special dividend. 

		13.1.2.	such distribution of special
dividend can include, but is not limited to, a distribution of assets from reserves of unrestricted equity or distribution of share
capital to the shareholders. 

		13.1.3.	the Board will specify in
any proposal for the dividend, whether the dividend, or a part of it, shall be considered a special dividend.

		13.2.	Should the Company, prior
to the delivery of the Performance Shares, issue new shares, stock options or other special rights to all shareholders, the Board
will in its sole discretion decide what the rights of the Participants will be in such cases.

		13.3.	The Company’s decision
to cancel existing shares held by the Company prior to the delivery of the Performance Shares will not affect the delivery of Performance
Shares.

    	 	 	 

     

    

 

		13.4.	Should the Company, during
the Plan Period, be placed into liquidation:

		13.4.1.	the Board may determine,
in its sole discretion, whether Performance Shares may be delivered at Grant Amount. Any delivery will be within such period as
resolved by the Board;

		13.4.2.	notwithstanding any other
provisions in these Terms & Conditions, should the Company, prior to the delivery of the Performance Shares, be deregistered
from the Trade Register, the Participants shall not have any right to delivery. 

		13.5.	Should the Company, during
the Plan Period, resolve to merge with another existing company or merge with a company to be formed, or should the Company resolve
to be demerged:

		13.5.1.	the Board may determine,
in its sole discretion, whether Performance Shares may be delivered at the Grant Amount prior to the merger or demerger. Any delivery
will be within such period as resolved by the Board;

		13.5.2.	the Board may determine,
in is sole discretion, whether Performance Shares should be converted into similar equity rights issued by the other company. In
such circumstances, the Board shall determine the terms and the period in which any Performance Shares may be converted; and

		13.5.3.	notwithstanding any other
provisions in these Terms & Conditions, following the closing of the merger or demerger, the Participants shall have no right
to delivery under this Plan. The same also applies to a merger, in which the Company takes part, and whereby the Company registers
itself as a European Company (Societas Europae) in another member state in the European Economic Area or, if the Company after
registering itself into a European Company registers a transfer of its domicile into another member state. 

		13.6.	Should the Company, during
the Plan Period, make a resolution to acquire its own shares through a tender offer to all the shareholders, the Company shall
make an equal offer to the Participants in respect of Performance Shares to settle the Performance Shares at the Grant Amount.
If the Company acquires or redeems its own shares in any other manner, or if the Company acquires stock options or other special
rights entitling to shares, no measures will need to be taken in relation to this Plan, unless the Board, in its sole discretion,
determines otherwise.

		13.7.	Should during the Plan Period
a tender offer regarding all shares and stock options issued by the Company be made or should a shareholder under the Articles
of Association of the Company or the Finnish Securities Markets Act have the obligation to redeem the shares from the Company’s
other shareholders, or to redeem the stock options, or should a shareholder have under the Finnish Companies Act the right and
obligation to redeem the shares from the Company’s other shareholders:

		13.7.1.	the Board may determine,
in its sole discretion, whether Performance Shares may be delivered at the Grant Amount prior to the tender offer or the offer
to redeem the shares.

		13.8.	Should a shareholder under
the Finnish Companies Act have the right to redeem the shares from the Company’s other shareholders, the Board may determine,
in its sole discretion, during the Plan Period, whether Performance Shares will be delivered at the Grant Amount prior to the redemption,
after which the Participants’ obligation to transfer all of their shares will be subject to the Finnish Companies Act.

		13.9.	The Board may, however,
in any of the situations resolved in this rule 14, determine, in its sole discretion, to provide the Participants with an opportunity
to convert their Performance Shares into equity-based incentives issued by another company on such terms and within such time period
prior to the completion of the tender offer or redemption, as resolved by the Board. 

    	 	 	 

     

    

 

		13.10.	Should the shares of the
Company during the Plan Period be delisted, with the effect that the shares are no longer listed on any recognised stock exchange,
nor subject to any other public trading:

		13.10.1.	the Board, may determine,
in its sole discretion, whether any Performance Shares may be delivered as a result of the delisting. Any delivery will be within
such period as resolved by the Board; and

		13.10.2.	the Board may also determine
whether any other amendments to these Terms & Conditions are required as a result of the delisting.

 

		14.	The
Recoupment of Equity in the Event of Certain Restatements

		14.1.	Under the Nokia policy on
the clawback of incentive compensation (“Clawback Policy”), as amended from time to time, the Board of Directors may,
in its sole discretion and at any time, resolve to recover or require reimbursement of all or a portion of incentive compensation,
which is defined in the Clawback Policy. The Grant of Performance Shares and delivery of Shares are covered by the Clawback Policy.

		14.2.	The impacted employees as
well as the events that trigger recoupment are defined in the Clawback Policy.

 

		15.	Governing
Law and Settlement of Disputes

		15.1.	These Terms & Conditions
are governed by Finnish laws. 

		15.2.	Disputes arising out of
these Terms & Conditions shall be settled by arbitration in Helsinki, Finland, in accordance with the Arbitration Rules of
the Finland Chamber of Commerce.

 

		16.	Processing
of personal data 

		16.1.	Participants’ personal
data is processed in connection with their participation in the Plan by any Group Member (and any third party appointed by a Group
Member in connection with the Plan) including the administration and maintenance of records. Depending on the location of the Participant,
the data might be transferred internationally. The processing is described in more detail in the privacy supplement that will be
provided to each Participant.

 

 

 

 

    	 	 	 

     

    

 

Schedule 1

 

Extract of the Plan rules approved by
the Board on March 5, 2020 and applied to Grants made prior to July 20, 2020.

 

 

		2.	Definitions

 

Baseline
Share Price: The average closing share price for Nokia shares on NASDAQ Helsinki for the five
trading days following the publication of Nokia’s fourth-quarter and full-year 2019 report.

 

Eligibility
Date: Subject to Rule 8, Participants remaining employees of the Nokia Group until December
31, 2022 (inclusive) will become eligible to receive the delivery of Shares under the Plan on the Delivery Date.

 

Plan
Period: The period beginning on the date Nokia’s fourth-quarter and full-year 2019 report
is published and ending on the fifth trading day following the publication of Nokia’s fourth-quarter and full-year 2022 report.

 

		7.	Changes
in Employment 

 

		7.1.	If the Participant’s
last day of employment with the Nokia Group occurs before the Eligibility Date by the reason of permanent disability (as defined
by the Company in its sole discretion), the Participant retains the right to delivery on the scheduled Delivery Date. 

		7.2.	In the case of death of
the Participant before the Eligibility Date, unless the Company determines otherwise in its sole discretion, the Performance Shares
will be delivered at the Grant Amount as soon as practicable thereafter. If made, such special delivery will constitute full and
final delivery of that Performance Share Grant.

		7.3.	If the Participant’s
last day of employment with the Nokia Group occurs before the Eligibility Date for any reason other than those mentioned above,
then, unless the Personnel Committee of the Board, or the Board as applicable, determines otherwise in its sole discretion, the
Company shall redeem the Performance Shares from the Participant without consideration, in which case the Participant shall not
be entitled to any delivery under the Plan.

		7.4.	In cases of voluntary and/or
statutory leave of absence of the Participant, the Company has the right to prorate the delivery.a03bxrd_hc2xholdingsxrig

.                                                                          NNNNNNNNNNNN                                                                                                                                                         +                                                                                                                Computershare Trust Company,  N.A.                                                                                                                                  150 Royall Street                                                                                                                      Canton Massachusetts  02021                                                                                                             For questions  call the Information Agent                                                                                                                Okapi Partners LLC at (855) 208-8902                MR A SAMPLE              DESIGNATION (IF ANY)              ADD 1              ADD 2              ADD 3                                                                                    NNNNNN              ADD 4              ADD 5              ADD 6                                                                                    C 1234567890     J N T     NNNNNNNNN                                                                                         NNNNNN                                                                                                        Primary Subscription     12345678901234                                                                                                       Rights   SUBSCRIPTION RIGHTS CERTIFICATE                             TO SUBSCRIBE FOR SHARES OF COMMON STOCK OF HC2 HOLDINGS, INC. (THE “COMPANY”)                            PLEASE FOLLOW THE INSTRUCTIONS BELOW:                            If you wish to subscribe for additional shares of common stock of the Company, you must submit your instructions in one of the following                            ways:    Option 1) Internet – Visit the Offer Website at hc2rightsoffer.com and using the Account and Control Codes printed above sign in and follow the instructions on the website.    Option 2) Mail – Complete the instructions, sign and return this Subscription Rights Certificate and your check in the envelope provided.                                              HC2 HOLDINGS, INC. SUBSCRIPTION RIGHTS FOR SHARES OF COMMON STOCK      To enter the above site, enter your Account Code and Control Code located above when prompted, the Company has provided this dedicated and secure website for you to                                              submit your subscription instructions and view electronic payment instructions.      VOID IF NOT RECEIVED BY THE SUBSCRIPTION AGENT BEFORE 5:00 P.M. NEW YORK CITY TIME ON NOVEMBER 20, 2020, UNLESS EXTENDED BY THE COMPANY (THE                                                                       “EXPIRATION DATE”)   The registered holder (the “holder”) whose name is inscribed hereon is the owner of the number of subscription rights (“Rights”) set forth above. Each Right provides the holder thereof the opportunity to purchase  (the “Basic Subscription Privilege”) 0.5462 shares of common stock, par value $0.001 per share (the “Common Stock”), of the Company, at a subscription price of $2.27 per share of Common Stock (the “Subscription  Price”), pursuant to a rights offering (the “Rights Offering”), on the terms and subject to the conditions set forth in the Company’s Base Prospectus, dated September 9, 2020 (the “Base Prospectus”), and the  Prospectus Supplement, dated October 7, 2020 (the “Prospectus Supplement” and, together with the Base Prospectus, the “Prospectus”). If you subscribe for all of the shares available pursuant to the Basic  Subscription Privilege, you are also entitled to purchase additional shares at the Subscription Price up to that number of shares of Common Stock that are offered in the Rights Offering but are not purchased by  the other Rights holders under their Basic Subscription Privilege (the “Oversubscription Privilege”). If oversubscription requests exceed the number of shares which are available, the Company will allocate the  available shares pro rata among those Rights holders who oversubscribed based on the number of shares each Rights holder subscribed for under the Basic Subscription Privilege. The other terms and conditions  of these Rights are set forth in the enclosed Prospectus. The Rights represented by this Rights Certificate may be exercised, as described further in the Prospectus, by delivering to Computershare Trust Company,  N.A. (the “Subscription Agent”) this Rights Certificate, properly completed and executed, together with full payment for all Rights completing the appropriate forms on the reverse side hereof and by returning the  full payment for all the Rights the holder elects to exercise under the Basic Subscription Privilege and Oversubscription Privilege prior to 5:00 p.m., New York City time, on the Expiration Date (unless extended by  the Company). If the holder attempts to exercise its Oversubscription Privilege and the Company is unable to issue the holder the full amount of shares of Common Stock requested, the Subscription Agent will  return to the holder any excess amount, in the manner in which made, without interest or deduction as soon as practicable after the Expiration Date of the Rights Offering. This Rights Certificate may be transferred  by duly completing and signing Section 2 on the reverse side hereof. All Rights not exercised prior to the Expiration Date (unless extended by the Company) shall be null and void.  If you choose to exercise your Rights, your completed Rights Certificate must be received by 5:00 p.m., New York City time, on November 20, 2020, which is the Expiration Date (unless extended by the Company).  If you choose to transfer your Rights, your completed Rights Certificate must be received by the Subscription Agent by 5:00 P.M., New York City time, on November 13, 2020, which is five business days prior   to the Expiration Date, as may be adjusted in the event of an extension of the Expiration Date.        Holder ID                COY                     ClassRights Qty Issued                           Rights Cert #      123456789              XXXX      Subscription Rights                XXX.XXXXXX                       12345678      Signature of Owner and U.S. Person for Tax Certification Signature of Co-Owner (if more than one registered holder listed) Date (mm/dd/yyyy)              12345678                       CLS                   XRT2                  COYC                                                              +                     03BXRD

 

.   FOR A MORE COMPLETE DESCRIPTION OF THE TERMS AND CONDITIONS OF THE RIGHTS OFFERING, PLEASE REFER TO THE PROSPECTUS, WHICH IS  INCORPORATED HEREIN BY REFERENCE. COPIES OF THE PROSPECTUS ARE AVAILABLE UPON REQUEST FROM THE INFORMATION AGENT, OKAPI  PARTNERS LLC, AT (855) 208-8902 (TOLL FREE)                               EXERCISABLE ON OR BEFORE 5:00 P.M., NEW YORK CITY TIME, ON NOVEMBER 20, 2020,                                          UNLESS EXTENDED BY THE COMPANY (THE “EXPIRATION DATE”)                                            (Complete appropriate section on subsequent pages of this form.)  The Company is conducting a Rights Offering, which entitles holders of shares of Common Stock and shares of the Company’s Series A Convertible Participating Preferred  Stock, par value $0.001 per share (the “Series A Preferred Stock”), Series A-2 Convertible Participating Preferred Stock, par value $0.001 per share (the “Series A-2 Preferred  Stock”), and Series B Non-Voting Convertible Participating Preferred Stock, par value $0.001 per share (the “Series B Preferred Stock” and, together with the Series A  Preferred Stock and the Series A-2 Preferred Stock, the “Preferred Stock”) to receive one Right for each share of Common Stock and Preferred Stock held by them as of  5:00 P.M. New York City time, on October 2, 2020 (the “Record Date”). Each Right provides the holder to subscribe for 0.5462 shares of Common Stock pursuant to its Basic  Subscription Privilege and, if its Basic Subscription Privilege is fully exercised, to subscribe for additional shares of Common Stock pursuant to its Oversubscription Privilege.  If the aggregate Subscription Price delivered or transmitted by the holder with the Rights Certificate exceeds the aggregate Subscription Price for all shares for which the  holder would be entitled to subscribe pursuant to its Basic Subscription Privilege and no direction is given as to the excess, such holder will be deemed to have subscribed  for a number of additional shares of Common Stock equal to the maximum whole number of additional shares of Common Stock that could be purchased with such excess  Subscription Price. Shares of Common Stock purchased pursuant to the Rights Offering will be issued as soon as practicable following the Expiration Date. Rights may only  be exercised in aggregate for whole numbers of shares of Common Stock; no fractional Rights or cash in lieu thereof were issued or paid. Fractional Rights will be rounded  to the nearest whole number with such adjustments as may be necessary to ensure that if all Rights are exercised, the Company will receive gross proceeds of $65 million.  Set forth herein is the number of Rights evidenced by this Rights Certificate that the holder is entitled to exercise pursuant to such holder’s Basic Subscription Privilege. If  shares of Common Stock or Preferred Stock applicable to a subscription are held by more than one record holder, the Rights Certificate must be signed by each such holder;  if a holder or joint holders (registrants) hold more than one position in the Company, as indicated by different accounts on the relevant record holder list, then separate,  properly completed and executed Rights Certificates must be submitted for each such position held by that or those joint holders (registrants).  This Rights Certificate is transferable. Holders should be aware that if they choose to exercise, assign, transfer or sell only part of their Rights they may not receive a new  Rights Certificate in sufficient time to exercise, assign, transfer or sell the remaining Rights evidenced thereby.                  For questions and to request copies of materials, call the Information Agent – Okapi Partners LLC at  (855) 208-8902 (toll free)                                 Please complete and return, as described below, on or before the dates outlined below.                                                  SUBSCRIPTION AGENT: Computershare, N.A.                                      By First Class Mail:      By Registered, Certified or Express Mail, or Overnight Courier:                                      Computershare, N.A.                         Computershare, N.A.                           HC2 Holdings, Inc. Rights Offering                HC2 Holdings, Inc. Rights Offering                                          P.O. Box 43011                         150 Royall Street, Suite V                                 Providence, RI 02940-3011                         Canton, MA 02021   To participate in the Rights Offering available through your shares held through Computershare you must follow the instructions and complete the relevant section(s) below,  sign and date the front page of this document, and return this signed Rights Certificate, with payment or any additional documents if applicable, to the  Subscription Agent listed above. The above language does not apply if you exercise your Rights via our website.  1.     Exercise Your Rights and Subscribe for Shares of Common Stock  To subscribe for shares of Common Stock under the Basic Subscription Privilege, please complete Sections 1.A and 1.C below.  If you wish to subscribe for shares of  Common Stock under the Oversubscription Privilege as well, you must also complete Section 1.B below. This Form of Exercise, Sale or Transfer and payment to the  Subscription Agent must be received by 5:00 p.m., New York City time, on November 20, 2020, which is the Expiration Date (unless extended by the Company). Funds  must clear your account before the Expiration Date. Please note that personal checks may take approximately five business days to clear your account. Please  see paragraph 1 of the instructions accompanying this Rights Certificate. 

 

.       PLEASE FILL IN ALL APPLICABLE INFORMATION.      A. Basic Subscription       ___________________________    =    ___________________________    x  $__________________________2.27 =  $____________________          (1 Rights = 0.5462 Shares    (Rights Exercised)            (No. of Class C common shares)   (Estimated Subscription Price)        of Common Stock)      B.  Over-Subscription Privilege*                                ___________________________   x  $___________________________2.27 =  $____________________                                                                     (No. of Class C common shares)   (Estimated Subscription Price)    * The Oversubscription Privilege may only be exercised if the Basic Subscription Privilege is exercised to the fullest extent possible and may only be exercised by Record Date   Shareholders as described in the Prospectus. Oversubscriptions may not be accepted by the Company and are subject to pro rata deductions.    C.   Amount of Check Enclosed (A + B) (or amount in Notice of Guaranteed Delivery)                  = $       ______________     SECTION 1. TO SUBSCRIBE: I acknowledge that I have received the Prospectus for the Rights Offering and I hereby irrevocably subscribe for the number of shares of Common Stock   indicated as the total of A and B hereon upon the terms and conditions specified in the Prospectus. I hereby agree that if I fail to pay for the shares of Common Stock for which I have   subscribed (or are deemed to have subscribed for as set forth above), the Company may exercise any of the remedies set forth in the Prospectus.    SECTION 2. TO TRANSFER RIGHTS: For value received, _____of the Rights represented by this Subscription Certificate are assigned to:    (Print Full Name of Assignee) _____________________________________________________________________________________________________________________________                                                                                                                                      Social Security Number    (Print Full Address) _____________________________________________________________________________________________________________________________________     (Print Full Address) _____________________________________________________________________________________________________________________________________     Signature(s) of Assignor(s) _______________________________________________________________________________________________________________________________    IMPORTANT: The signature(s) must correspond in every particular, without alteration, with the name(s) as printed on your Subscription Certificate.     Your Signature must be guaranteed by an Eligible Guarantor Institution as that term is defined under Rule 17Ad-15 of the Securities Exchange Act of 1934, which may include:             a) a commercial bank or trust company, or             b) a member firm of a domestic stock exchange, or             c) a savings bank or credit union.    Signature Guaranteed By:  __________________________________     __________________________________                                 (Name of Bank or Firm)                            (Signature of Officer and Title)   Return Subscription Certificate by first class mail or overnight courier to: Computershare.   By First Class Mail:                                                By Express Mail or Overnight Courier:  Computershare                                                       Computershare  C/O Voluntary Corporate Actions/HC2 Holdings, Inc.                  C/O Voluntary Corporate Actions/HC2 Holdings, Inc.  P.O. Box 43011                                                      150 Royall Street  Suite V  Providence, RI  02940-3011                                          Canton, MA  02021

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