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ck0001466225-ex44_310.htm

 

Exhibit 4.4

DESCRIPTION OF THE REGISTRANT’S SECURITIES

REGISTERED PURSUANT TO SECTION 12 OF THE

SECURITIES EXCHANGE ACT OF 1934

 

Resource Real Estate Opportunity REIT, Inc. has shares of its common stock, $0.01 par value per share, registered under Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).  References in the following discussion to “we,” “our” and “us” and similar references mean Resource Real Estate Opportunity REIT, Inc., excluding its subsidiaries, unless the context otherwise requires or otherwise expressly stated, and references to “you” and “your” mean holders of our common stock.

 

Description of Our Common Stock

The following description of our common stock does not purport to be complete and is subject to and qualified in its entirety by reference to Maryland law and to our charter and bylaws, copies of which are filed as exhibits to the Annual Report on Form 10-K to which this Exhibit 4.4 is a part.

General 

Our charter provides that we may issue up to 1,010,050,000 shares of capital stock, of which 1,000,000,000 shares are designated as common stock, par value $0.01 per share, 50,000 shares are designated as convertible stock, par value $0.01 per share and 10,000,000 shares are designated as preferred stock, par value $0.01 per share. In addition, our board of directors may amend our charter to increase or decrease the amount of our authorized shares. 

Common Stock 

All shares of our common stock have equal rights as to earnings, assets, distributions and voting. When the shares of our common stock are issued in the manner contemplated, they will be duly authorized, validly issued, fully paid and non-assessable. Distributions may be paid to the holders of our common stock, if and when authorized by our board of directors and declared by us out of funds legally available therefore, subject to any preferential rights of any preferred stock that we issue in the future. Holders of shares of our common stock do not have preemptive rights, which means that you will not have an automatic option to purchase any new shares that we issue, nor do holders of our shares have any preference, conversion, exchange, sinking fund, redemption or appraisal rights. In the event of our liquidation, dissolution or winding up, each share of our common stock would be entitled to share ratably in all of our assets that are legally available for distribution after payment of or adequate provision for all our known debts and other liabilities and subject to any preferential rights of holders of preferred stock, if any preferred stock is outstanding at such time. Subject to our charter restrictions on the transfer and ownership of our common stock and except as may be specified otherwise in the terms of any class or series of our common stock, each share of our common stock entitles the holder to one vote on all matters submitted to a vote of stockholders, including the election of our directors. Except as provided with respect to any other class or series of stock, the holders of our common stock will possess exclusive voting power. There is no cumulative voting in the election of directors, which means that holders of a majority of our outstanding common shares can elect all of our directors and holders of less than a majority of such shares will be unable to elect any director. 

Our board of directors has authorized the issuance of shares of our capital stock without certificates. We expect that, until our shares are listed on a national securities exchange, we will not issue shares in certificated form. Information regarding restrictions on the transferability of our shares that, under Maryland law, would otherwise have been required to appear on our share certificates will instead be furnished to stockholders upon request and without charge. 

We maintain a stock ledger that contains the name and address of each stockholder and the number of shares that the stockholder holds. With respect to uncertificated stock, we will continue to treat the stockholder registered on our stock ledger as the owner of the shares until the new owner delivers a properly executed form to us, which form we will provide to any registered holder upon request. 

 

Convertible Stock 

Our authorized capital stock includes 50,000 shares of convertible stock, par value $0.01 per share. There will be no distributions paid on shares of convertible stock. The conversion of the convertible stock into common shares will dilute the value of our shares of common stock. 

With certain limited exceptions, shares of convertible stock shall not be entitled to vote on any matter, or to receive notice of, or to participate in, any meeting of stockholders of the company at which they are not entitled to vote. However, the affirmative vote of the holders of more than two-thirds of the outstanding shares of convertible stock is required (A) for the adoption of any amendment, alteration or repeal of a provision of the charter or (B) to effect or validate a consolidation with or 

 

 

merger of our company into another entity, that adversely changes the preferences, limitations or relative rights of the shares of convertible stock. 

Upon the occurrence of (A) our making total distributions on the then outstanding shares of our common stock equal to the issue price of those shares (that is, the price paid for those shares) plus a 10% cumulative, non-compounded, annual return on the issue price of those outstanding shares; or (B) the listing of the shares of common stock for trading on a national securities exchange, each outstanding share of our convertible stock will convert into the number of shares of our common stock described below. Before we will be able to pay distributions to our stockholders equal to the aggregate issue price of our then outstanding shares plus a 10% cumulative, non-compounded, annual return on the issue price of those outstanding shares, we will need to sell a portion of our assets. Thus, the sale of one or more assets will be a practical prerequisite for conversion under clause (A) above. 

Upon the occurrence of either such event, each share of convertible stock shall, unless our advisory agreement with our advisor has been terminated or not renewed on account of a material breach by our advisor, generally be converted into a number of shares of common stock equal to 1/50,000 of the quotient of: 

 

				
	
 
	
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(A) the lesser of 

 

				
	
 
	
◾  
	
 
	
(i) 25% of the amount, if any, by which 

 

				
	
 
	
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(1) the value of the company (determined in accordance with the provisions of the charter and summarized in the following paragraph) as of the date of the event triggering the conversion plus the total distributions paid to our stockholders through such date on the then outstanding shares of our common stock exceeds 

 

				
	
 
	
◾
	
 
	
(2) the sum of the aggregate issue price of those outstanding shares plus a 10% cumulative, non-compounded, annual return on the issue price of those outstanding shares as of the date of the event triggering the conversion, or 

 

				
	
 
	
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(ii) 15% of the amount, if any, by which 

 

				
	
 
	
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(1) the value of the company as of the date of the event triggering the conversion plus the total distributions paid to our stockholders through such date on the then outstanding shares of our common stock exceeds 

 

				
	
 
	
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(2) the sum of the aggregate issue price of those outstanding shares plus a 6% cumulative, non-compounded, annual return on the issue price of those outstanding shares as of the date of the event triggering the conversion, divided by 

 

				
	
 
	
•
	
 
	
(B) the value of the company divided by the number of outstanding shares of common stock, in each case, as of the date of the event triggering the conversion. In the case of conversion upon the listing of our shares, the conversion of the convertible stock will not occur until the 31st trading day after the date of such listing.

However, if our advisory agreement with our advisor expires without renewal or is terminated (other than because of a material breach by our advisor) prior to each such triggering event described in the foregoing paragraph (an “advisory agreement termination”), then upon either such triggering event the holder of the convertible stock will be entitled to a prorated portion of the number of shares of common stock determined by the foregoing calculation, where such proration is based on the percentage of time we were advised by our advisor. 

As used above and in our charter, “value of the company” as of a specific date means our actual value as a going concern on the applicable date based on the difference between (A) the actual value of all of our assets as determined in good faith by our board, including a majority of the independent directors, and (B) all of our liabilities as set forth on our balance sheet for the period ended immediately prior to the determination date, provided that (1) if such value is being determined in connection with a change of control that establishes our net worth, then the value shall be the net worth established thereby and (2) if such value is being determined in connection with the listing of our common stock for trading on a national securities exchange, then the value shall be the number of outstanding shares of common stock multiplied by the closing price of a single share of common stock, averaged over a period of 30 trading days after the date of listing. If the holder of shares of convertible stock disagrees with the value determined by the board, then each of the holder of the convertible stock and us shall name one appraiser and the two named appraisers shall promptly agree in good faith to the appointment of one other appraiser whose determination of the value of the company shall be final and binding on the parties. The cost of such appraisal shall be shared evenly between us and our advisor. 

 

Our charter provides that if we: 

 

				
	
 
	
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reclassify or otherwise recapitalize our outstanding common stock (except to change the par value, or to change from no par value to par value, or to subdivide or otherwise split or combine shares); or 

 

 

 

				
				
	
 
	
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consolidate or merge with another entity in a transaction in which we are either (1) not the surviving entity or (2) the surviving entity but that results in a reclassification or recapitalization of our common stock (except to change the par value, or to change from no par value to par value, or to subdivide or otherwise split or combine shares), 

then we or the successor or purchasing business entity must provide that the holder of each share of our convertible stock outstanding at the time one of the above events occurs will continue to have the right to convert the convertible stock upon an event triggering conversion. After one of the above transactions occurs, the convertible stock will be convertible into the kind and amount of stock and other securities and property received by the holders of common stock in the transaction that occurred, such that upon conversion, the holders of convertible stock will realize as nearly as possible the same economic rights and effects as described above in the description of the conversion of our convertible stock. This right will apply to successive reclassifications, recapitalizations, consolidations, and mergers until the convertible stock is converted. 

Our board of directors will oversee the conversion of the convertible stock to ensure that any shares of common stock issuable in connection with the conversion is calculated in accordance with the terms of our charter and to evaluate the impact of the conversion on our REIT status. If, in the good faith judgment of our board, full conversion of the convertible stock would jeopardize our status as a REIT, then only such number of shares of convertible stock (or fraction of a share thereof) shall be converted into a number of shares of common stock such that our REIT status would not be jeopardized. The conversion of the remaining shares of convertible stock will be deferred until the earliest date after our board of directors determines that such conversion will not jeopardize our qualification as a REIT. Any such deferral will not otherwise alter the terms of the convertible stock. 

Preferred Stock 

Our charter authorizes our board of directors to designate and issue one or more classes or series of preferred stock without stockholder approval. A majority of our independent directors who do not have an interest in the transaction must approve any issuance of preferred stock. Our board of directors may determine the relative rights, preferences and privileges of each class or series of preferred stock so issued, which may be more beneficial than the rights, preferences and privileges attributable to our common stock. The issuance of preferred stock could have the effect of delaying or preventing a change in control. Our board of directors has no present plans to issue preferred stock but may do so at any time in the future without stockholder approval. 

Restriction on Ownership of Shares 

Ownership Limit 

To maintain our REIT qualification, not more than 50% in value of our outstanding shares may be owned, directly or indirectly, by five or fewer individuals (including certain entities treated as individuals under the Internal Revenue Code) during the last half of each taxable year. In addition, at least 100 persons who are independent of us and each other must beneficially own our outstanding shares for at least 335 days per 12-month taxable year or during a proportionate part of a shorter taxable year. We may prohibit certain acquisitions and transfers of shares so as to ensure our continued qualification as a REIT under the Internal Revenue Code. However, we cannot assure you that this prohibition will be effective. 

To help ensure that we meet these tests, our charter prohibits any person or group of persons from acquiring, directly or indirectly, beneficial ownership of more than 9.8% of our aggregate outstanding shares unless exempted by our board of directors. Our board of directors may waive this ownership limit with respect to a particular person if the board receives evidence that ownership in excess of the limit will not jeopardize our REIT status. For purposes of this provision, we treat corporations, partnerships and other entities as single persons. 

This limitation does not apply to the holder(s) of our convertible stock or the common stock issued upon conversion of our convertible stock. However, our board of directors may defer the timing of the conversion of all or a portion of our convertible stock if it determines that full conversion could jeopardize our qualification as a REIT under then applicable federal income tax laws and regulation. Any such deferral will not otherwise alter the terms of the convertible stock, and such stock will convert at the earliest date after our board of directors determines that such conversion will not jeopardize our qualification as a REIT. 

Any attempted transfer of our shares that, if effective, would result in a violation of our ownership limit or would result in our shares being owned by fewer than 100 persons will be null and void and will cause the number of shares causing the violation to be automatically transferred to a trust for the exclusive benefit of one or more charitable beneficiaries. The prohibited transferee will not acquire any rights in the shares. The automatic transfer will be deemed to be effective as of the close of business on the business day prior to the date of the attempted transfer. We will designate a trustee of the trust that will not be affiliated with us or the prohibited transferee. We will also name one or more charitable organizations as a beneficiary of the share trust. 

Shares held in trust will remain issued and outstanding shares and will be entitled to the same rights and privileges as all 

 

 

other shares of the same class or series. The prohibited transferee will not benefit economically from any of the shares held in trust, will not have any rights to dividends or distributions and will not have the right to vote or any other rights attributable to the shares held in the trust. The trustee will receive all dividends and distributions on the shares held in trust and will hold such dividends or distributions in trust for the benefit of the charitable beneficiary. The trustee may vote any shares held in trust. 

Within 20 days of receiving notice from us that any of our shares have been transferred to the trust for the charitable beneficiary, the trustee will sell those shares to a person designated by the trustee whose ownership of the shares will not violate the above restrictions. Upon the sale, the interest of the charitable beneficiary in the shares sold will terminate and the trustee will distribute the net proceeds of the sale to the prohibited transferee and to the charitable beneficiary as follows. The prohibited transferee will receive the lesser of (i) the price paid by the prohibited transferee for the shares or, if the prohibited transferee did not give value for the shares in connection with the event causing the shares to be held in the trust (e.g., a gift, devise or other similar transaction), the market price (as defined in our charter) of the shares on the day of the event causing the shares to be held in the trust and (ii) the price received by the trustee from the sale or other disposition of the shares. Any net sale proceeds in excess of the amount payable to the prohibited transferee will be paid immediately to the charitable beneficiary. If, prior to our discovery that shares have been transferred to the trust, the shares are sold by the prohibited transferee, then (i) the shares shall be deemed to have been sold on behalf of the trust and (ii) to the extent that the prohibited transferee received an amount for the shares that exceeds the amount he was entitled to receive, the excess shall be paid to the prohibited trustee upon demand. 

In addition, shares held in the trust for the charitable beneficiary will be deemed to have been offered for sale to us, or our designee, at a price per share equal to the lesser of (i) the price per share in the transaction that resulted in the transfer to the trust (or, in the case of a devise or gift, the market price at the time of the devise or gift) and (ii) the market price on the date we, or our designee, accept the offer. We will have the right to accept the offer until the trustee has sold the shares. Upon a sale to us, the interest of the charitable beneficiary in the shares sold will terminate and the trustee will distribute the net proceeds of the sale to the prohibited transferee. 

 

Any person who acquires or attempts to acquire shares in violation of the foregoing restrictions or who would have owned the shares that were transferred to any such trust must give us immediate written notice of such event, and any person who proposes or attempts to acquire or receive shares in violation of the foregoing restrictions must give us at least 15 days’ written notice prior to such transaction. In both cases, such persons shall provide to us such other information as we may request in order to determine the effect, if any, of such transfer on our status as a REIT. 

The foregoing restrictions will continue to apply until our board of directors determines it is no longer in our best interest to continue to qualify as a REIT. The ownership limit does not apply to any underwriter in an offering of our shares or to a person or persons exempted from the ownership limit by our board of directors based upon appropriate assurances that our qualification as a REIT would not be jeopardized. 

Within 30 days after the end of each taxable year, every owner of 5% or more of our outstanding capital stock will be asked to deliver to us a statement setting forth the number of shares owned directly or indirectly by such person and a description of how such person holds the shares. Each such owner shall also provide us with such additional information as we may request in order to determine the effect, if any, of his or her beneficial ownership on our status as a REIT and to ensure compliance with our ownership limit. 

These restrictions could delay, defer or prevent a transaction or change in control of our company that might involve a premium price for our shares of common stock or otherwise be in the best interests of our stockholders. 

Suitability Standards and Minimum Purchase Requirements 

 

Our charter provides that, until our common stock is listed on a national securities exchange, to purchase our common stock, the purchaser must represent to us:

 

	
 
	
(i)
	
that such purchaser (or, in the case of sales to fiduciary accounts, that the beneficiary, the fiduciary account or the grantor or donor who directly or indirectly supplies the funds to purchase the shares if the grantor or donor is the fiduciary) has a minimum annual gross income of $70,000 and a net worth (excluding home, home furnishings and automobiles) of not less than $70,000; or

 

	
 
	
(ii)
	
that such purchaser (or, in the case of sales to fiduciary accounts, that the beneficiary, the fiduciary account or the grantor or donor who directly or indirectly supplies the funds to purchase the shares if the grantor or donor is the fiduciary) has a net worth (excluding home, home furnishings and automobiles) of not less than $250,000.

 

Each purchase of shares of common stock shall comply with the requirements regarding minimum initial and subsequent cash investment amounts set forth in our then effective registration statement as such registration statement has been amended or supplemented as of the date of such purchase or any higher or lower applicable state requirements with respect to minimum initial and subsequent cash investment amounts in effect as of the date of the issuance or transfer.  Subsequent 

 

 

purchasers, i.e., potential purchasers of your shares, must also meet the net worth or income standards, and unless you are transferring all of your shares, you may not transfer your shares in a manner that causes you or your transferee to own fewer than the number of shares required to meet the minimum purchase requirements, except for the following transfers without consideration: transfers by gift, transfers by inheritance, intrafamily transfers, family dissolutions, transfers to affiliates and transfers by operation of law. These suitability and minimum purchase requirements are applicable until our shares of common stock are listed on a national securities exchange, and these requirements may make it more difficult for you to sell your shares.

 

Meetings and Special Voting Requirements 

An annual meeting of our stockholders will be held each year, at least 30 days after delivery of our annual report. Special meetings of stockholders may be called only upon the request of a majority of our directors, a majority of our independent directors, our chief executive officer, our president or upon the written request of stockholders holding at least 10% of the shares entitled to be cast on any issue proposed to be considered at the special meeting. Upon receipt of a written request of common stockholders holding at least 10% of the shares entitled to be cast stating the purpose of the special meeting, our secretary will provide all of our stockholders written notice of the meeting and the purpose of such meeting. The meeting must be held not less than 15 days or more than 60 days after the distribution of the notice of the meeting. The presence in person or by proxy of stockholders entitled to cast a majority of all the votes entitled to be cast at any stockholder meeting constitutes a quorum. Unless otherwise provided by the Maryland General Corporation Law or our charter, the affirmative vote of a majority of all votes cast is necessary to take stockholder action. With respect to the election of directors, each candidate nominated for election to the board of directors must receive a majority of the votes present, in person or by proxy, in order to be elected. Therefore, if a nominee receives fewer “for” votes than “withhold” votes in an election, then the nominee will not be elected. 

Our charter provides that the concurrence of the board is not required in order for the common stockholders to amend the charter, dissolve the corporation or remove directors. However, we have been advised that Section 2-604 and Section 3-403 of the Maryland General Corporation Law do require board approval in order to amend our charter or dissolve, respectively. Without the approval of a majority of the shares of common stock entitled to vote on the matter, the board of directors may not: 

 

				
	
 
	
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amend the charter to adversely affect the rights, preferences and privileges of the common stockholders; 

 

				
	
 
	
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amend charter provisions relating to director qualifications, fiduciary duties, liability and indemnification, conflicts of interest, investment policies or investment restrictions; 

 

				
	
 
	
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cause our liquidation or dissolution after our initial investment in property; 

 

				
	
 
	
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sell all or substantially all of our assets other than in the ordinary course of business; or 

 

				
	
 
	
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cause our merger or reorganization. 

Advance Notice for Stockholder Nominations for Directors and Proposals of New Business 

Our bylaws provide that with respect to an annual meeting of stockholders, nominations of individuals for election to the board of directors and the proposal of business to be considered by stockholders may be made only: 

 

				
	
 
	
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pursuant to our notice of the meeting; 

 

				
	
 
	
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by the board of directors; or 

 

				
	
 
	
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by a stockholder who gives notice of the nomination or proposal not less than 90 days prior to the first anniversary of the date of the mailing of the notice for the preceding year’s annual stockholders’ meeting. 

Our bylaws contain a similar notice requirement in connection with nominations for directors at a special meeting of stockholders called for the purpose of electing one or more directors. Failure to comply with the notice provisions will make stockholders unable to nominate directors or propose new business. The purpose of requiring stockholders to give us advance notice of nominations and other business is to afford our board of directors a meaningful opportunity to consider the qualifications of the proposed nominees and the advisability of any other proposed business and, to the extent deemed necessary or desirable by our board of directors, to inform stockholders and make recommendations about such qualifications or business, as well as to provide a more orderly procedure for conducting meetings of stockholders. 

 

Inspection of Books and Records 

As a part of our books and records, we maintain at our principal office an alphabetical list of the names of our common stockholders, along with their addresses and telephone numbers and the number of shares held by each of them. We update this 

 

 

stockholder list at least quarterly. Except as noted below, the list is available for inspection at our principal office by a common stockholder or his or her designated agent upon request of the stockholder and we will mail this list to any common stockholder within 10 days of receipt of his or her request. We may impose a reasonable charge for expenses incurred in reproducing such list. Stockholders, however, may not sell or use this list for a commercial purpose other than in the interest of the applicant as a stockholder relative to the affairs of our company. The purposes for which stockholders may request this list include matters relating to their voting rights. Each common stockholder who receives a copy of the stockholder list shall keep such list confidential and shall sign a confidentiality agreement to the effect that such stockholder will keep the stockholder list confidential and share such list only with its employees, representatives or agents who agree in writing to maintain the confidentiality of the stockholder list. 

If our advisor or our board of directors neglects or refuses to exhibit, produce or mail a copy of the stockholder list as requested, our advisor or board, as the case may be, shall be liable to the common stockholder requesting the list for the costs, including attorneys’ fees, incurred by that stockholder for compelling the production of the stockholder list and any actual damages suffered by any common stockholder for the neglect or refusal to produce the list. It shall be a defense that the actual purpose and reason for the requests for inspection or for a copy of the stockholder list is not for a proper purpose but is instead for the purpose of securing such list of stockholders or other information for the purpose of selling such list or copies thereof, or of using the same for a commercial purpose other than in the interest of the applicant as a stockholder relative to the affairs of our company. We may require that the stockholder requesting the stockholder list represent that the request is not for a commercial purpose unrelated to the stockholder’s interest in our company. The remedies provided by our charter to stockholders requesting copies of the stockholder list are in addition to, and do not in any way limit, other remedies available to stockholders under federal law, or the law of any state. As the operations of both RRE Opportunity Holdings, LLC and our Operating Partnership will be conducted by us, an inspection of the our books and records would include an inspection of the books and records of RRE Opportunity Holdings, LLC and our Operating Partnership. 

Control Share Acquisitions 

The Maryland General Corporation Law provides that control shares of a Maryland corporation acquired in a control share acquisition have no voting rights except to the extent approved by a vote of two-thirds of the votes entitled to be cast on the matter. Shares owned by the acquirer, by officers or by directors who are employees of the corporation are excluded from shares entitled to vote on the matter. Control shares are voting shares of stock that, if aggregated with all other shares owned by the acquirer or with respect to which the acquirer has the right to vote or to direct the voting of (except solely by virtue of revocable proxy) would entitle the acquirer to exercise voting power in electing directors within one of the following ranges of voting powers: 

 

				
	
 
	
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one-tenth or more but less than one-third; 

 

				
	
 
	
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one-third or more but less than a majority; or 

 

				
	
 
	
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a majority or more of all voting power. 

Control shares do not include shares the acquiring person is then entitled to vote as a result of having previously obtained stockholder approval. A control share acquisition means the acquisition of control shares, but does not include the acquisition of shares (i) under the laws of descent and distribution, (ii) under the satisfaction of a pledge or other security interest created in good faith and not for the purpose of circumventing this subtitle, or (iii) under a merger, consolidation, or share exchange effected under the control share acquisition statute if the corporation is a party to the merger, consolidation, or share exchange. 

A person who has made or proposes to make a control share acquisition may compel the board of directors of the corporation to call a special meeting of stockholders to be held within 50 days of the demand to consider the voting rights of the shares. The right to compel the calling of a special meeting is subject to the satisfaction of certain conditions, including an undertaking to pay the expenses of the meeting. If no request for a meeting is made, the corporation may itself present the question at any stockholders meeting. 

If voting rights are not approved at the meeting or if the acquiring person does not deliver an acquiring person statement as required by the statute, then the corporation may repurchase for fair value any or all of the control shares, except those for which voting rights have previously been approved. The right of the corporation to repurchase control shares is subject to certain conditions and limitations. Fair value is determined, without regard to the absence of voting rights for the control shares, as of the date of the last control share acquisition by the acquirer or of any meeting of stockholders at which the voting rights of the shares are considered and not approved. If voting rights for control shares are approved at a stockholders meeting and the acquirer becomes entitled to vote a majority of the shares entitled to vote, all other stockholders may exercise appraisal rights. The fair value of the shares as determined for purposes of these appraisal rights may not be less than the highest price per share paid in the control share acquisition. 

The control share acquisition statute does not apply to shares acquired in a merger, consolidation or share exchange if the 

 

 

corporation is a party to the transaction or to acquisitions approved or exempted by the charter or bylaws of the corporation. 

Our bylaws contain a provision exempting from the control share acquisition statute any and all acquisitions by any person of share of our stock. There can be no assurance that this provision will not be amended or eliminated at any time in the future. 

Business Combinations 

Under the Maryland General Corporation Law, “business combinations” between a Maryland corporation and an interested stockholder or an affiliate of an interested stockholder are prohibited for five years after the most recent date on which the interested stockholder becomes an interested stockholder. These business combinations include mergers, consolidations, share exchanges, or, in circumstances specified in the statute, asset transfers or issuances or reclassifications of equity securities. An interested stockholder is defined as: 

 

				
	
 
	
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any person who beneficially owns 10% or more of the voting power of the corporation’s shares; or 

 

				
	
 
	
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an affiliate or associate of the corporation who, at any time within the two-year period before the date in question, was the beneficial owner of 10% or more of the voting power of the then outstanding voting stock of the corporation. 

A person is not an interested stockholder under the statute if the board of directors approved in advance the transaction by which he or she otherwise would have become an interested stockholder. However, in approving a transaction, the board of directors may provide that its approval is subject to compliance, at or after the time of approval, with any terms and conditions determined by the board. 

 

After the five-year prohibition, any business combination between the corporation and an interested stockholder generally must be recommended by the board of directors of the corporation and approved by the affirmative vote of at least: 

 

				
	
 
	
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80% of the votes entitled to be cast by holders of outstanding voting stock of the corporation; and 

 

				
	
 
	
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two-thirds of the votes entitled to be cast by holders of voting stock of the corporation other than shares held by the interested stockholder with whom or with whose affiliate the business combination is to be effected, or held by an affiliate or associate of the interested stockholder. 

These super-majority vote requirements do not apply if the corporation’s common stockholders receive a minimum price, as defined under the Maryland General Corporation Law, for their shares in the form of cash or other consideration in the same form as previously paid by the interested stockholder for its shares. 

The statute permits various exemptions from its provisions, including business combinations that are exempted by the board of directors before the time that the interested stockholder becomes an interested stockholder. We have opted out of these provisions by resolution of our board of directors. However, our board of directors may, by resolution, opt in to the business combination statute in the future. 

Subtitle 8 

Subtitle 8 of Title 3 of the Maryland General Corporation Law permits a Maryland corporation with a class of equity securities registered under the Exchange Act, and at least three independent directors to elect to be subject, by provision in its charter or bylaws or a resolution of its board of directors and notwithstanding any contrary provision in the charter or bylaws, to any or all of five provisions: 

 

				
	
 
	
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a classified board, 

 

				
	
 
	
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a two-thirds vote requirement for removing a director, 

 

				
	
 
	
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a requirement that the number of directors be fixed only by vote of the directors, 

 

				
	
 
	
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a requirement that a vacancy on the board be filled only by the remaining directors and for the remainder of the full term of the directorship in which the vacancy occurred, and 

 

				
	
 
	
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a majority requirement for the calling of a special meeting of stockholders. 

We have added provisions to our charter that prohibit us, until such time that our shares of common stock are listed on a national securities exchange, from electing to be subject to the provisions under Subtitle 8. Through provisions in our bylaws unrelated to Subtitle 8, we already vest in our board of directors the exclusive power to fix the number of directorships. Our bylaws may be amended by our stockholders or the board of directors. 

 

 

Tender Offer by Stockholders 

Our charter provides that any tender offer made by a stockholder, including any “mini-tender” offer, must comply with certain notice and disclosure requirements. These procedural requirements with respect to tender offers apply to any widespread solicitation for shares of our stock at firm prices for a limited time period. 

In order for one of our stockholders to conduct a tender offer to another stockholder, our charter requires that the stockholder comply with Regulation 14D of the Exchange Act, and provide us with notice of such tender offer at least ten business days before initiating the tender offer. Pursuant to our charter, Regulation 14D would require any stockholder initiating a tender offer to provide: 

 

				
	
 
	
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specific disclosure to stockholders focusing on the terms of the offer and information about the bidder; 

 

				
	
 
	
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the ability to allow stockholders to withdraw tendered shares while the offer remains open; 

 

				
	
 
	
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the right to have tendered shares accepted on a pro rata basis throughout the term of the offer if the offer is for less than all of our shares; and 

 

				
	
 
	
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that all stockholders of the subject class of shares be treated equally. 

In addition to the foregoing, there are certain ramifications to stockholders should they attempt to conduct a noncompliant tender offer. If any stockholder initiates a tender offer without complying with the provisions set forth above, in our sole discretion, we shall have the right to redeem such noncompliant stockholder’s shares and any shares acquired in such tender offer. The noncomplying stockholder shall also be responsible for all of our expenses in connection with that stockholder’s noncompliance. 

 

Restrictions on Roll-Up Transactions 

A Roll-up Transaction is a transaction involving the acquisition, merger, conversion or consolidation, directly or indirectly, of us and the issuance of securities of an entity that is created or would survive after the successful completion of a Roll-up Transaction, which we refer to as a Roll-up Entity. This term does not include: 

 

				
	
 
	
•
	
 
	
a transaction involving our securities that have been for at least 12 months listed on a national securities exchange; or 

 

				
	
 
	
•
	
 
	
a transaction involving only our conversion into a trust or association if, as a consequence of the transaction, there will be no significant adverse change in the voting rights of our common stockholders, the term of our existence, the compensation to our advisor or our investment objectives. 

In connection with any proposed Roll-up Transaction, an appraisal of all our assets will be obtained from a competent independent appraiser. Our assets will be appraised on a consistent basis, and the appraisal will be based on an evaluation of all relevant information and will indicate the value of our assets as of a date immediately preceding the announcement of the proposed Roll-up Transaction. If the appraisal will be included in a prospectus used to offer the securities of a Roll-Up Entity, the appraisal will be filed with the SEC and, if applicable, the states in which registration of such securities is sought, as an exhibit to the registration statement for the offering. The appraisal will assume an orderly liquidation of assets over a 12-month period. The terms of the engagement of the independent appraiser will clearly state that the engagement is for our benefit and the benefit of our stockholders. A summary of the appraisal, indicating all material assumptions underlying the appraisal, will be included in a report to our stockholders in connection with any proposed Roll-up Transaction. 

In connection with a proposed Roll-up Transaction, the person sponsoring the Roll-up Transaction must offer to our common stockholders who vote “no” on the proposal the choice of: 

 

			
	
 
	
(1)
	
accepting the securities of the Roll-up Entity offered in the proposed Roll-up Transaction; or 

 

			
	
 
	
(2)
	
one of the following: 

 

			
	
 
	
(A)
	
remaining as common stockholders of us and preserving their interests in us on the same terms and conditions as existed previously; or 

 

			
	
 
	
(B)
	
receiving cash in an amount equal to the stockholders’ pro rata share of the appraised value of our net assets. 

We are prohibited from participating in any proposed Roll-up Transaction: 

 

				

 

 

				
	
 
	
•
	
 
	
that would result in our common stockholders having democracy rights in a Roll-up Entity that are less than those provided 

in our charter and bylaws with respect to the election and removal of directors and the other voting rights of our common stockholders, annual and special meetings of common stockholders, the amendment of our charter and our dissolution; 

 

				
	
 
	
•
	
 
	
that includes provisions that would operate to materially impede or frustrate the accumulation of shares by any purchaser of the securities of the Roll-up Entity, except to the minimum extent necessary to preserve the tax status of the Roll-up Entity, or that would limit the ability of an investor to exercise the voting rights of its securities of the Roll-up Entity on the basis of the number of shares of common stock that such investor has held in us; 

 

				
	
 
	
•
	
 
	
in which investors’ rights of access to the records of the Roll-up Entity would be less than those provided in our charter and described above under “—Meetings and Special Voting Requirements”; or 

 

				
	
 
	
•
	
 
	
in which any of the costs of the Roll-up Transaction would be borne by us if the Roll-up Transaction would not be approved by our common stockholders.Exhibit 4.1

 

THIS WARRANT AND THE SHARES ISSUABLE HEREUNDER
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAWS OF
ANY STATE AND, EXCEPT AS SET FORTH IN SECTIONS 5.3 AND 5.4 BELOW, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED (I)
UNLESS AND UNTIL REGISTERED UNDER SAID ACT AND LAWS OR (II) WITHOUT AN OPINION OF COUNSEL, IN FORM AND SUBSTANCE REASONABLY SATISFACTORY
TO THE COMPANY, THAT SUCH OFFER, SALE, PLEDGE OR OTHER TRANSFER IS EXEMPT FROM SUCH REGISTRATION.

 

FORM OF
WARRANT TO PURCHASE STOCK1

 

	 	Company	ROCKWELL MEDICAL, INC.
	 	Number of Shares	[    ]
	 	Type/Series of Stock	Common Stock
	 	Warrant Price	$[    ]per share
	 	Issue Date	[    ]
	 	Expiration Date	[    ] (See also Section 5.1(b))
	 	Credit Facility	This Warrant to Purchase Stock (“Warrant”) is issued in connection with
    that certain Loan and Security Agreement, dated March 16, 2020, among Innovatus Life Sciences Lending Fund I, LP, as Lender
    and Collateral Agent, the Lenders from time to time party thereto, and the Company (as modified, amended and/or restated from
    time to time, the “Loan Agreement”).

 

THIS WARRANT CERTIFIES
THAT, for good and valuable consideration, Innovatus Life Sciences Lending Fund I, LP
(“Innovatus”), a Delaware limited partnership with an office located at 777 Third Avenue, 25th Floor, New York,
NY 10017 (together with any successor or permitted assignee or transferee of this Warrant or of any shares issued upon exercise
hereof, “Holder”) is entitled to purchase the number of fully paid and non-assessable shares (the “Shares”)
of the above-stated Type/Series of Stock (the “Class”) of the above-named company (the “Company”)
at the above-stated Warrant Price, all as set forth above and as adjusted pursuant to Section 2 of this Warrant, subject to the
provisions and upon the terms and conditions set forth in this Warrant.

 

SECTION
1.             
EXERCISE.

 

1.1              Method
of Exercise. Holder may at any time and from time to time exercise this Warrant, in whole or in part, by delivering to
the Company the original of this Warrant together with a duly executed Notice of Exercise in substantially the form attached
hereto as Appendix 1 and, unless Holder is exercising this Warrant pursuant to a cashless exercise set forth in Section 1.2,
a check, wire transfer of same-day funds (to an account designated by the Company), or other form of payment acceptable to
the Company for the aggregate Warrant Price for the Shares being purchased.

 

 

1
The Company acknowledges and agrees that the Warrant issued in connection with the Term A Loan under, and as defined in,
the Loan Agreement, will be at the lower of (i) the volume weighted average closing price of Rockwell’s stock for the 5-trading
day period ending on the last trading day immediately preceding the execution of the Loan Agreement or (ii) the closing price
on the last trading day immediately preceding the execution of the Loan Agreement, and that, in the event the Company draws the
Term B Loan and/or the Term C Loan,  each as defined therein, the Company shall issue the Holder additional Warrants to purchase
shares of the Company’s common stock, equal to 3.50% of the funded amount of such Term B and Term C Loans, respectively,
at the lower of (i) Warrant Price for this Warrant or (ii) the volume weighted average closing price of Rockwell’s stock
for the 5-trading day period ending on the last trading day immediately preceding the funding of the Term B Loan or Term C Loan,
as applicable.

 

     

     

    

 

1.2             
Cashless Exercise. On any exercise of this Warrant, in lieu of payment of the aggregate Warrant Price in the manner
as specified in Section 1.1 above, but otherwise in accordance with the requirements of Section 1.1, Holder may elect to receive
Shares equal to the value of this Warrant, or portion hereof as to which this Warrant is being exercised. Thereupon, the Company
shall issue to the Holder such number of fully paid and non-assessable Shares as are computed using the following formula:

 

X = Y(A-B)/A

 

where:

		X =	the
                                         number of Shares to be issued to the Holder;

 

		Y =	the number of Shares with respect
                                         to which this Warrant is being exercised (inclusive of the Shares surrendered to the
                                         Company in payment of the aggregate Warrant Price);

 

		A =	the
                                         Fair Market Value (as determined pursuant to Section 1.3 below) of one Share; and

 

		B =	the
                                         Warrant Price.

 

1.3             
Fair Market Value. If the Company’s common stock is then traded or quoted on a nationally recognized securities
exchange, inter-dealer quotation system or over-the-counter market (a “Trading Market”) and the Class is common
stock, the fair market value of a Share shall be the closing price or last sale price of a share of common stock reported for
the Business Day immediately before the date on which Holder delivers this Warrant together with its Notice of Exercise to the
Company. If the Company’s common stock is not traded or quoted on a Trading Market, the Board of Directors of the Company
shall determine the fair market value of a Share in its reasonable good faith judgment.

 

1.4             
Delivery of Certificate and New Warrant. Promptly after Holder exercises this Warrant in the manner set forth in
Section 1.1 or 1.2 above, the Company shall deliver to Holder a certificate representing the Shares issued to Holder upon such
exercise and, if this Warrant has not been fully exercised and has not expired, a new warrant of like tenor representing the Shares
not so acquired.

 

1.5             
Replacement of Warrant. On receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction
or mutilation of this Warrant and, in the case of loss, theft or destruction, on delivery of an indemnity agreement reasonably
satisfactory in form, substance and amount to the Company or, in the case of mutilation, on surrender of this Warrant to the Company
for cancellation, the Company shall, within a reasonable time, execute and deliver to Holder, in lieu of this Warrant, a new warrant
of like tenor and amount.

 

1.6             
Treatment of Warrant Upon Acquisition of Company.

 

(a)               Acquisition.
For the purpose of this Warrant, “Acquisition” means any transaction or series of related transactions
involving: (i) the sale, lease, exclusive license or other disposition of all or substantially all of the assets of the
Company; (ii) any merger or consolidation of the Company into or with another person or entity (other than a merger or
consolidation effected exclusively to change the Company’s domicile), or any other corporate reorganization, in which
the stockholders of the Company in their capacity as such immediately prior to such merger, consolidation or reorganization,
own less than a majority of the Company’s (or the surviving or successor entity’s) outstanding voting power
immediately after such merger, consolidation or reorganization; or (iii) any sale or other transfer by the stockholders of
the Company of shares representing a majority of the Company’s then-total outstanding combined voting power.

 

    2

     

    

 

(b)              
Treatment of Warrant at Acquisition. In the event of an Acquisition in which the consideration to be received by
the Company’s stockholders consists solely of cash, solely of Marketable Securities or a combination of cash and Marketable
Securities (a “Cash/Public Acquisition”), either (i) Holder shall exercise this Warrant pursuant to Section
1.1 and/or 1.2 and such exercise will be deemed effective immediately prior to and contingent upon the consummation of such Acquisition
or (ii) if Holder elects not to exercise the Warrant, this Warrant will expire immediately prior to the consummation of such Acquisition.

 

(c)              
The Company shall provide Holder with written notice of its request relating to the Cash/Public Acquisition (together with
such reasonable information as Holder may reasonably require regarding the treatment of this Warrant in connection with such contemplated
Cash/Public Acquisition giving rise to such notice), which is to be delivered to Holder not less than ten (10) Business Days prior
to the closing of the proposed Cash/Public Acquisition. Notwithstanding the foregoing, if, immediately prior to the Cash/Public
Acquisition, the fair market value of one Share (or other security issuable upon the exercise hereof) as determined in accordance
with Section 1.3 above would be greater than the Warrant Price in effect on such date, then this Warrant shall automatically be
deemed on and as of such date to be exercised pursuant to Section 1.2 above as to all Shares (or such other securities) for which
it shall not previously have been exercised, and the Company shall promptly notify the Holder of the number of Shares (or such
other securities) issued upon such exercise to the Holder.

 

(d)              
Upon the closing of any Acquisition other than a Cash/Public Acquisition defined above, the acquiring, surviving or successor
entity shall assume the obligations of this Warrant, and this Warrant shall thereafter be exercisable for the same securities
and/or other property as would have been paid for the Shares issuable upon exercise of the unexercised portion of this Warrant
as if such Shares were outstanding on and as of the closing of such Acquisition, subject to further adjustment from time to time
in accordance with the provisions of this Warrant.

 

(e)              
As used in this Warrant, “Marketable Securities” means securities meeting all of the following requirements:
(i) the issuer thereof is then subject to the reporting requirements of Section 13 or Section 15(d) of the Securities Exchange
Act of 1934, as amended (the “Exchange Act”), and is then current in its filing of all required reports and
other information under the Act and the Exchange Act; (ii) the class and series of shares or other security of the issuer that
would be received by Holder in connection with the Acquisition were Holder to exercise this Warrant on or prior to the closing
thereof is then traded in Trading Market; and (iii) Holder would be able to publicly re-sell, within six (6) months following
the closing of such Acquisition, all of the issuer’s shares and/or other securities that would be received by Holder in
such Acquisition were Holder to exercise this Warrant in full on or prior to the closing of such Acquisition.

 

    3

     

    

 

SECTION
2.             
ADJUSTMENTS TO THE SHARES AND WARRANT PRICE.

 

2.1             
Stock Dividends, Splits, Etc. If the Company declares or pays a dividend or distribution on the outstanding shares
of the Class payable in common stock or other securities or property (other than cash), then upon exercise of this Warrant, for
each Share acquired, Holder shall receive, without additional cost to Holder, the total number and kind of securities and property
which Holder would have received had Holder owned the Shares of record as of the date the dividend or distribution occurred. If
the Company subdivides the outstanding shares of the Class by reclassification or otherwise into a greater number of shares, the
number of Shares purchasable hereunder shall be proportionately increased and the Warrant Price shall be proportionately decreased.
If the outstanding shares of the Class are combined or consolidated, by reclassification or otherwise, into a lesser number of
shares, the Warrant Price shall be proportionately increased and the number of Shares shall be proportionately decreased.

 

2.2             
Reclassification, Exchange, Combinations or Substitution. Upon any event whereby all of the outstanding shares of
the Class are reclassified, exchanged, combined, substituted, or replaced for, into, with or by Company securities of a different
class and/or series, then from and after the consummation of such event, this Warrant will be exercisable for the number, class
and series of Company securities that Holder would have received had the Shares been outstanding on and as of the consummation
of such event, and subject to further adjustment thereafter from time to time in accordance with the provisions of this Warrant.
The provisions of this Section 2.2 shall similarly apply to successive reclassifications, exchanges, combinations substitutions,
replacements or other similar events.

 

2.3             
Intentionally Omitted.

 

2.4             
Intentionally Omitted.

 

2.5             
No Fractional Share. No fractional Share shall be issuable upon exercise of this Warrant and the number of Shares
to be issued shall be rounded down to the nearest whole Share. If a fractional Share interest arises upon any exercise of the
Warrant, the Company shall eliminate such fractional Share interest by paying Holder in cash the amount computed by multiplying
the fractional interest by (a) the fair market value (as determined in accordance with Section 1.3 above) of a full Share, less
(b) the then-effective Warrant Price.

 

2.6             
Notice/Certificate as to Adjustments. Upon each adjustment of the Warrant Price, Class and/or number of Shares,
the Company, at the Company’s expense, shall notify Holder in writing within a reasonable time setting forth the adjustments
to the Warrant Price, Class and/or number of Shares and facts upon which such adjustment is based. The Company shall, upon written
request from Holder, furnish Holder with a certificate of its Chief Financial Officer, including computations of such adjustment
and the Warrant Price, Class and number of Shares in effect upon the date of such adjustment.

 

    4

     

    

 

SECTION
3.             
 REPRESENTATIONS
AND COVENANTS OF THE COMPANY.

 

3.1              
Representations and Warranties. The Company represents and warrants to, and agrees with, the Holder as follows:

 

(a)              
[The initial Warrant Price referenced on the first page of this Warrant is not greater than the lower of (i) the volume
weighted average closing price of Rockwell’s stock for the 5-trading day period ending on the last trading day immediately
preceding the execution of the Loan Agreement or (ii) the closing price on the last trading day immediately preceding the execution
of the Loan Agreement.]2 [The initial Warrant Price referenced on the first
page of this Warrant is not greater than the lower of (i) Warrant Price for the Warrant issued by the Company to the Holder on
March 16, 2020 or (ii) the volume weighted average closing price of Rockwell’s stock for the 5-trading day period ending
on the last trading day immediately preceding the Issue Date.]3

 

(b)              
All Shares which may be issued upon the exercise of this Warrant, and all securities, if any, issuable upon conversion
of the Shares, shall, upon issuance, be duly authorized, validly issued, fully paid and non-assessable, and free of any liens
and encumbrances except for restrictions on transfer provided for herein or under applicable federal and state securities laws.
The Company covenants that it shall at all times cause to be reserved and kept available out of its authorized and unissued capital
stock such number of shares of the Class, common stock and other securities as will be sufficient to permit the exercise in full
of this Warrant and the conversion of the Shares into common stock or such other securities.

 

(c)              
The Company’s capitalization table attached hereto as Schedule 1 is true and complete, in all material respects,
as of the Issue Date.

 

3.2             
Notice of Certain Events. If the Company proposes at any time to:

 

(a)              
declare any dividend or distribution upon the outstanding shares of the Class or common stock, whether in cash, property,
stock, or other securities and whether or not a regular cash dividend;

 

(b)              
offer for subscription or sale pro rata to the holders of the outstanding shares of the Class any additional shares of
any class or series of the Company’s stock (other than pursuant to contractual pre-emptive rights);

 

(c)              
effect any reclassification, exchange, combination, substitution, reorganization or recapitalization of the outstanding
shares of the Class; or

 

(d)              
effect an Acquisition or to liquidate, dissolve or wind up;

 

then, in connection with each such event,
the Company shall give Holder:

 

(1) at least
seven (7) Business Days prior written notice of the date on which a record will be taken for such dividend, distribution, or subscription
rights (and specifying the date on which the holders of outstanding shares of the Class will be entitled thereto) or for determining
rights to vote, if any, in respect of the matters referred to in (a) and (b) above; and

 

(2) in
the case of the matters referred to in (c) and (d) above at least seven (7) Business Days prior written notice of the date
when the same will take place (and specifying the date on which the holders of outstanding shares of the Class will be
entitled to exchange their shares for the securities or other property deliverable upon the occurrence of such event).

 

 

2       To
be included for the Term A Warrants.

3       To
be included for the Term B Warrants and Term C Warrants, as applicable.

 

    5

     

    

 

Reference is made to Section 1.6(c) whereby
this Warrant will be deemed to be exercised pursuant to Section 1.2 hereof if the Company does not give written notice to Holder
of a Cash/Public Acquisition as required by the terms hereof. Company will also provide information requested by Holder that is
reasonably necessary to enable Holder to comply with Holder’s accounting or reporting requirements.

 

3.3             
Registration Rights. In the event that the Company files a resale registration statement at any time after the Issue
Date, the Company will use reasonable efforts to include the securities to be acquired upon exercise of this Warrant in such resale
registration statement.

 

SECTION
4.             
REPRESENTATIONS,
WARRANTIES OF THE HOLDER.

 

The Holder represents
and warrants to the Company as follows:

 

4.1             
Purchase for Own Account. This Warrant and the securities to be acquired upon exercise of this Warrant by Holder
are being acquired for investment for Holder’s account, not as a nominee or agent, and not with a view to the public resale
or distribution within the meaning of the Act. Holder also represents that it has not been formed for the specific purpose of
acquiring this Warrant or the Shares.

 

4.2             
Disclosure of Information. Holder is aware of the Company’s business affairs and financial condition and has
received or has had full access to all the information it considers necessary or appropriate to make an informed investment decision
with respect to the acquisition of this Warrant and its underlying securities. Holder further has had an opportunity to ask questions
and receive answers from the Company regarding the terms and conditions of the offering of this Warrant and its underlying securities
and to obtain additional information (to the extent the Company possessed such information or could acquire it without unreasonable
effort or expense) necessary to verify any information furnished to Holder or to which Holder has access.

 

4.3             
Investment Experience. Holder understands that the purchase of this Warrant and its underlying securities involves
substantial risk. Holder has experience as an investor in securities of companies in the development stage and acknowledges that
Holder can bear the economic risk of such Holder’s investment in this Warrant and its underlying securities and has such
knowledge and experience in financial or business matters that Holder is capable of evaluating the merits and risks of its investment
in this Warrant and its underlying securities and/or has a preexisting personal or business relationship with the Company and
certain of its officers, directors or controlling persons of a nature and duration that enables Holder to be aware of the character,
business acumen and financial circumstances of such persons.

 

4.4             
Accredited Investor Status. Holder is an “accredited investor” within the meaning of Regulation D promulgated
under the Act.

 

4.5              The
Act. Holder understands that this Warrant and the Shares issuable upon exercise hereof have not been registered under the
Act in reliance upon a specific exemption therefrom, which exemption depends upon, among other things, the bona fide nature
of the Holder’s investment intent as expressed herein. Holder understands that this Warrant and the Shares issued upon
any exercise hereof must be held indefinitely unless subsequently registered under the Act and qualified under applicable
state securities laws, or unless exemption from such registration and qualification are otherwise available. Holder is aware
of the provisions of Rule 144 promulgated under the Act.

 

    6

     

    

 

4.6             
No Voting Rights. Holder, as a Holder of this Warrant, will not have any voting rights until the exercise of this
Warrant.

 

SECTION
5.              MISCELLANEOUS.

 

5.1              
Term and Automatic Conversion Upon Expiration.

 

(a)              
Term. Subject to the provisions of Section 1.6 above, this Warrant is exercisable in whole or in part at any time
and from time to time on or before 6:00 P.M., Eastern time, on the Expiration Date and shall be void thereafter.

 

(b)              
Automatic Cashless Exercise upon Expiration. In the event that, upon the Expiration Date, the fair market value
of one Share (or other security issuable upon the exercise hereof) as determined in accordance with Section 1.3 above is greater
than the Warrant Price in effect on such date, then this Warrant shall automatically be deemed on and as of such date to be exercised
pursuant to Section 1.2 above as to all Shares (or such other securities) for which it shall not previously have been exercised,
and the Company shall, within a reasonable time, deliver a certificate representing the Shares (or such other securities) issued
upon such exercise to Holder.

 

5.2             
Legends. The Shares (and the securities issuable, directly or indirectly, upon conversion of the Shares, if any)
shall be imprinted with a legend in substantially the following form:

 

THE SHARES EVIDENCED BY THIS CERTIFICATE
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAWS OF
ANY STATE AND, EXCEPT AS SET FORTH IN THAT CERTAIN WARRANT TO PURCHASE STOCK ISSUED BY THE ISSUER TO Innovatus
Life Sciences Lending Fund I, LP DATED MARCH 16, 2020, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED (I) UNLESS
AND UNTIL REGISTERED UNDER SAID ACT AND LAWS OR (II) WITHOUT AN OPINION OF COUNSEL, IN FORM AND SUBSTANCE REASONABLY SATISFACTORY
TO THE ISSUER, THAT SUCH OFFER, SALE, PLEDGE OR OTHER TRANSFER IS EXEMPT FROM SUCH REGISTRATION.

 

5.3             
Compliance with Securities Laws on Transfer. This Warrant and the Shares issuable upon exercise of this Warrant
(and the securities issuable, directly or indirectly, upon conversion of the Shares, if any) may not be transferred or assigned
in whole or in part except in compliance with applicable federal and state securities laws by the transferor and the transferee
(including, without limitation, the delivery of investment representation letters and legal opinions reasonably satisfactory to
the Company, as reasonably requested by the Company). The Company shall not require Holder to provide an opinion of counsel if
the transfer is to an affiliate of Holder. Additionally, the Company shall also not require an opinion of counsel if there is
no material question as to the availability of Rule 144 promulgated under the Act.

 

    7

     

    

 

5.4             
Transfer Procedure. Subject to the provisions of Section 5.3 and upon providing the Company with written notice,
Holder may transfer all or part of this Warrant or the Shares issuable upon exercise of this Warrant (or the securities issuable
directly or indirectly, upon conversion of the Shares, if any) to any transferee, provided, however, in connection
with any such transfer, Holder will give the Company notice of the portion of the Warrant being transferred with the name, address
and taxpayer identification number of the transferee and Holder will surrender this Warrant to the Company for reissuance to the
transferee(s) (and Holder if applicable); and provided further, that any subsequent transferee shall agree in writing with
the Company to be bound by all of the terms and conditions of this Warrant.

 

5.5             
Notices. All notices and other communications hereunder from the Company to the Holder, or vice versa, shall be
deemed delivered and effective (i) when given personally, (ii) on the third (3rd) Business Day after being mailed by
first-class registered or certified mail, postage prepaid, (iii) upon actual receipt if given by facsimile or electronic mail
and such receipt is confirmed in writing by the recipient, or (iv) on the first Business Day following delivery to a reliable
overnight courier service, courier fee prepaid, in any case at such address as may have been furnished to the Company or Holder,
as the case may be, in writing by the Company or such Holder from time to time in accordance with the provisions of this Section
5.5. All notices to Holder shall be addressed as follows until the Company receives notice of a change of address in connection
with a transfer or otherwise:

 

INNOVATUS LIFE SCIENCES LENDING FUND I, LP

777 Third Avenue, 25th Floor

New York, NY 10017

Attention: Claes Ekstrom

 

Notice to the Company
shall be addressed as follows until Holder receives notice of a change in address:

 

ROCKWELL MEDICAL, INC.

411 Hackensack Avenue, Suite 501

Hackensack, NJ 07601

 

Attn: Chief Financial Officer

 

With a copy (which shall not constitute notice) to:

 

Gibson, Dunn & Crutcher LLP

555 Mission Street, Suite 3000

San Francisco, CA 94105

 

5.6             
Waiver. This Warrant and any term hereof may be changed, waived, discharged or terminated (either generally or in
a particular instance and either retroactively or prospectively) only by an instrument in writing signed by the party against
which enforcement of such change, waiver, discharge or termination is sought.

 

    8

     

    

 

5.7             
Attorneys’ Fees. In the event of any dispute between the parties concerning the terms and provisions of this
Warrant, the party prevailing in such dispute shall be entitled to collect from the other party all costs incurred in such dispute,
including reasonable attorneys’ fees.

 

5.8             
Counterparts; Facsimile/Electronic Signatures. This Warrant may be executed in counterparts, all of which together
shall constitute one and the same agreement. Any signature page delivered electronically or by facsimile shall be binding to the
same extent as an original signature page with regards to any agreement subject to the terms hereof or any amendment thereto.

 

5.9             
Governing Law. This Warrant shall be governed by and construed in accordance with the laws of the State of New York,
without giving effect to its principles regarding conflicts of law.

 

5.10         
Headings. The headings in this Warrant are for purposes of reference only and shall not limit or otherwise affect
the meaning of any provision of this Warrant.

 

5.11         
Business Days. “Business Day” is any day that is not a Saturday, Sunday or a day on which banks
in New York, New York are closed.

 

[Signature page follows]

 

    9

     

    

 

IN WITNESS WHEREOF,
the parties have caused this Warrant to Purchase Stock to be executed by their duly authorized representatives effective as of
the Issue Date written above.

 

	“COMPANY”	 
	 	 
	ROCKWELL MEDICAL, INC.	 
	 	 
	By: 	                	 

 

	Name:	       	 
	 	(Print)	 
	Title:	 	 

 

	“HOLDER”	 
	 	 
	INNOVATUS LIFE SCIENCES LENDING FUND I, LP	 
	 	 
	By:	           	 

 

	Name:	       	 
	 	(Print)	 
	Title:	    	 

 

    10

     

    

 

APPENDIX
1

NOTICE
OF EXERCISE

 

1.       The
undersigned Holder hereby exercises its right purchase ___________ shares of the Common Stock of ROCKWELL MEDICAL, INC. (the “Company”)
in accordance with the attached Warrant To Purchase Stock, and tenders payment of the aggregate Warrant Price for such shares
as follows:

 

	 ̈ 	check in the amount of $________ payable
    to order of the Company enclosed herewith
	 	 
	 ̈ 	Wire transfer of immediately available funds to
    the Company’s account
	 	 
	 ̈ 	Cashless Exercise pursuant to Section 1.2 of the
    Warrant
	 	 
	 ̈ 	Other [Describe] __________________________________________

 

2.       Please
issue a certificate or certificates representing the Shares in the name specified below:

 

	 	___________________________________________
	 	Holder’s Name
	 	 
	 	___________________________________________
	 	 
	 	___________________________________________
	 	(Address)

 

3.       By
its execution below and for the benefit of the Company, Holder hereby restates each of the representations and warranties in Section
4 of the Warrant to Purchase Stock as of the date hereof.

 

	 	HOLDER:
	 	 
	 	 
	 	By:	                       
	 	Name:	 
	 	Title:	 
	 	(Date):	 

 

Appendix
1

 

     

     

    

 

SCHEDULE
1

 

Company Capitalization Table

 

The number of shares of common stock outstanding as of
November 12, 2019 was 63,955,893 (as set forth in the Company’s quarterly report on Form 10-Q filed with the SEC).

 

Schedule 1

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