Document:

Exhibit 10.2

 

THE SECURITIES REPRESENTED HEREBY
HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”) AND ARE “RESTRICTED SECURITIES”
AS DEFINED IN RULE 144 PROMULGATED UNDER THE ACT. THE SECURITIES MAY NOT BE OFFERED, SOLD, PLEDGED, OR OTHERWISE DISTRIBUTED OR
TRANSFERRED EXCEPT (i) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR (ii) PURSUANT TO AN EXEMPTION FROM REGISTRATION
UNDER THE ACT, AND, IN THE CASE OF A TRANSACTION EXEMPT FROM REGISTRATION, UNLESS THE COMPANY AND DEPOSITARY HAVE RECEIVED AN OPINION
OF COUNSEL REASONABLY SATISFACTORY TO EACH OF THEM THAT SUCH TRANSACTION DOES NOT REQUIRE REGISTRATION UNDER THE ACT.

 

 

WARRANT TO PURCHASE ORDINARY SHARES REPRESENTED
BY AMERICAN DEPOSITARY SHARES

 

AKARI THERAPEUTICS, PLC.

 

	Warrant No.: 2020 __________ - __	Initial Exercise Date:  __________, 2020
	 	Issuance Date:    __________, 2020

 

Number of American Depositary Shares: ________________

 

THIS WARRANT TO PURCHASE
ORDINARY SHARES REPRESENTED BY AMERICAN DEPOSITARY SHARES (the “Warrant”) certifies that, for value received,
_____________ or its assigns (the “Holder”) is entitled, upon the terms and subject to the limitations on exercise
and the conditions hereinafter set forth, at any time on or after  __________, 2020 (the “Initial Exercise Date”)
and on or prior to 5:00 p.m. (New York City time) on  __________, 2025 (the “Termination Date”) but not thereafter,
to subscribe for and purchase from Akari Therapeutics, Plc., a public company with limited liability incorporated under the laws
of England and Wales (the “Company”), up to ______ Ordinary Shares (the “Warrant Shares”)
represented by ________ American Depositary Shares (“ADSs”), as subject to adjustment hereunder (the “Warrant
ADSs”). The purchase price of one Warrant ADS shall be equal to the Exercise Price, as defined in Section 2(b).

 

Section 1. Definitions.
Capitalized terms used and not otherwise defined herein shall have the meanings set forth in those certain Securities Purchase
Agreements (the “Purchase Agreements”), dated  __________, 2020, by
and among the Company and the purchasers signatory thereto.

 

Section 2. Exercise.

 

a) Exercise
of Warrant. Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any time or times
on or after the Initial Exercise Date and on or before the Termination Date by delivery to the Company (or such other office or
agency of the Company as it may designate by notice in writing to the registered Holder at the address of the Holder appearing
on the books of the Company) and the Depositary of a duly executed facsimile copy (or .pdf copy via e-mail) of the Notice
of Exercise in the form annexed hereto (the “Notice of Exercise”). Within the earlier of (i) two (2) Trading
Days and (ii) the number of Trading Days comprising the Standard Settlement Period (as defined in Section 2(d)(i) herein) following
the date of exercise as aforesaid the Holder shall deliver to the Company the aggregate applicable Exercise Price of the Warrant
ADSs thereby purchased by wire transfer or cashier’s check drawn on a United States bank. No ink-original Notice of Exercise
shall be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice of Exercise be
required. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this Warrant
to the Company until the Holder has purchased all of the Warrant ADSs available hereunder and the Warrant has been exercised in
full, in which case, the Holder shall surrender this Warrant to the Company for cancellation within three (3) Trading Days of the
date the final Notice of Exercise is delivered to the Company. Partial exercises of this Warrant resulting in purchases of a portion
of the total number of Warrant ADSs available hereunder shall have the effect of lowering the outstanding number of Warrant ADSs
purchasable hereunder in an amount equal to the applicable number of Warrant ADSs purchased. The Holder and the Company shall maintain
records showing the number of Warrant ADSs purchased and the date of such purchases. The Company shall deliver any objection to
any Notice of Exercise within one (1) Trading Day of receipt of such notice. The Holder and any assignee, by acceptance of this
Warrant, acknowledge and agree that, by reason of the provisions of this paragraph, following the purchase of a portion of the
Warrant ADSs hereunder, the number of Warrant ADSs available for purchase hereunder at any given time may be less than the amount
stated on the face hereof.

 

     

     

    

 

b) Exercise
Price. Subject to Section 2(c) hereof, the exercise price per ADS under this Warrant shall be $2.20, subject to adjustment
hereunder (or, if higher, the nominal value of an ADS at the time of issue) (the “Exercise Price”).

 

c) Cashless
Exercise. If at any time after the 6-month anniversary of the Issuance Date there is no effective registration statement registering
with a current prospectus available for the resale of the Warrant ADSs by the Holder, then this Warrant may (if permitted by applicable
law and the Company’s articles of association) also be exercised, in whole or in part, at such time by means of a “cashless
exercise” in which the Holder shall, upon payment to the Company of a reduced Exercise Price per Warrant ADS actually to
be issued pursuant to the cashless exercise equal to the nominal value of an ADS (i.e., at the Issuance Date, £1), be entitled
to receive a number of Warrant ADSs equal to the quotient obtained by dividing [(A-B) (X)] by (A), where:

 

	 	(A) = 	as applicable: (i) the VWAP on the Trading Day immediately preceding the date of the applicable Notice of Exercise if such Notice of Exercise is (1) both executed and delivered pursuant to Section 2(a) hereof on a day that is not a Trading Day or (2) both executed and delivered pursuant to Section 2(a) hereof on a Trading Day prior to the opening of “regular trading hours” (as defined in Rule 600(b)(64) of Regulation NMS promulgated under the federal securities laws) on such Trading Day, (ii) at the option of the Holder, either (y) the VWAP on the Trading Day immediately preceding the date of the applicable Notice of Exercise or (z) the Bid Price of the ADSs on the principal Trading Market as reported by Bloomberg L.P. as of the time of the Holder’s execution of the applicable Notice of Exercise if such Notice of Exercise is executed during “regular trading hours” on a Trading Day and is delivered within two (2) hours thereafter (including until two (2) hours after the close of “regular trading hours” on a Trading Day) pursuant to Section 2(a) hereof or (iii) the VWAP on the date of the applicable Notice of Exercise if the date of such Notice of Exercise is a Trading Day and such Notice of Exercise is both executed and delivered pursuant to Section 2(a) hereof after the close of “regular trading hours” on such Trading Day;

 

	 	(B) = 	the Exercise Price of this Warrant for cash exercise, as adjusted hereunder; and

 

	 	(X) = 	the number of Warrant ADSs that would be issuable upon exercise of this Warrant in accordance with the terms of this Warrant if such exercise were by means of a cash exercise rather than a cashless exercise.

 

“Bid
Price” means, for any date, the price determined by the first of the following
clauses that applies: (a) if the ADSs are then listed or quoted on a Trading Market, the bid price of the ADSs for the time in
question (or the nearest preceding date) on the Trading Market on which the ADSs are then listed or quoted as reported by Bloomberg
L.P. (based on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is not
a Trading Market, the volume weighted average price of the ADSs for such date (or the nearest preceding date) on OTCQB or OTCQX
as applicable, (c) if the ADSs not then listed or quoted for trading on OTCQB or OTCQX and if prices for the ADSs are then reported
in the “Pink Sheets” published by OTC Markets Group, Inc. (or a similar organization or agency succeeding to its functions
of reporting prices), the most recent bid price per share of the ADSs so reported, or (d) in all other cases, the fair market value
of an ADSs as determined by an independent appraiser selected in good faith by the Holders of a majority in interest of the Securities
then outstanding and reasonably acceptable to the Company, the fees and expenses of which shall be paid by the Company.

 

“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the ADSs then listed or quoted
on a Trading Market, the daily volume weighted average price of the ADSs for such date (or the nearest preceding date) on the Trading
Market on which the ADSs then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30 a.m. (New York City
time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is not a Trading Market, the volume weighted average price of the
ADSs for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, (c) if the ADSs not then listed or quoted for
trading on OTCQB or OTCQX and if prices for the ADSs are then reported in the “Pink Sheets” published by OTC Markets
Group, Inc. (or a similar organization or agency succeeding to its functions of reporting prices), the most recent bid price per
ADS so reported, or (d) in all other cases, the fair market value of an ADS as determined by an independent appraiser selected
in good faith by the Holders of a majority in interest of the Securities then outstanding and reasonably acceptable to the Company,
the fees and expenses of which shall be paid by the Company.

  

     

     

    

 

d) Mechanics
of Exercise.

 

i. Delivery
of Warrant ADSs Upon Exercise. The Company shall deposit the Warrant Shares subject to such exercise with Deutsche Bank Trust
Company Americas, the Depositary for the ADSs (the “Depositary”) and instruct the Depositary to credit the account
of the Holder’s in book entry format at American Stock Transfer and Trust bearing the restrictive legend in Section 5. If
eligible the Depositary may credit the Holder’s prime broker with The Depository Trust Company through its Deposit/Withdrawal
At Custodian system (“DWAC”) if the Depositary is then a participant in such system and either (A) there is
an effective registration statement with a current prospectus registering for resale of the Warrant Shares represented by the Warrant
ADSs by the Holder or (B) the Warrant Shares represented by the Warrant ADSs are eligible for resale by the Holder without the
current information requirements, or the volume or manner-of-sale limitations pursuant to Rule 144 and the Warrant ADSs have been
sold by the Holder prior to the Warrant ADS Delivery Date (as defined below), and otherwise by electronic (registered in book-entry
format) or physical delivery to the address specified by the Holder in the Notice of Exercise, in each case (provided that the
whole Exercise Price payable has been received by the Company) by the date that is two (2) Trading Days after the delivery to the
Company of the Notice of Exercise (such date, the “Warrant ADS Delivery Date”). If the Warrant ADSs can be delivered
via DWAC, then in addition to the delivery of the Warrant Shares to the Depositary, within one (1) Trading Day of the applicable
exercise, the Depositary shall have received from the Company any legal opinions or other documentation required by the Depositary
to deliver such ADSs without legend and, if applicable and requested by the Company prior to the Warrant ADS Delivery Date, the
Depositary shall have received from the Holder a confirmation of sale of the Warrant ADSs (provided the requirement of the Holder
to provide a confirmation as to the sale of Warrant ADSs shall not be applicable to the issuance of unlegended Warrant ADS’s
upon a cashless exercise of this Warrant if the Warrant ADSs are then eligible for resale pursuant to Rule 144(b)(1)). The Holder
(or other person named in the Notice of Exercise as recipient of the Warrant ADSs) shall be treated by the Company as if it were
the beneficial owner of the Warrant Shares represented by the Warrant ADSs subject to a Notice of Exercise for all purposes, as
of the date the Warrant has been exercised, with payment to the Company of the applicable Exercise Price and all taxes required
to be paid by the Holder, if any, pursuant to Section 2(d)(vi) prior to the issuance of such Warrant ADSs having been made.

 

ii. Delivery
of New Warrants Upon Exercise. If this Warrant shall have been exercised in part, the Company shall, at the request of a Holder
and upon surrender of this Warrant certificate, at the time of delivery of the Warrant ADSs, deliver to the Holder a new Warrant
evidencing the rights of the Holder to purchase the unpurchased Warrant ADSs called for by this Warrant, which new Warrant shall
in all other respects be identical with this Warrant.

 

iii. Rescission
Rights. If the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant ADSs pursuant to Section 2(d)(i)
by the Warrant ADS Delivery Date, then the Holder will have the right to rescind such exercise in respect of the untransmitted
Warrant ADSs (with the effect that the Holder’s right to acquire such Warrant ADSs pursuant to this Warrant shall be restored)
and the Company shall return to the Holder the aggregate Exercise Price paid to the Company for such Warrant ADSs.

 

iv. Compensation
for Buy-In on Failure to Timely Deliver Warrant ADSs Upon Exercise. In addition to any other rights available to the Holder,
if the Company fails to cause the Depositary to deliver to the Holder the Warrant ADSs in accordance with the provisions of Section
2(d)(i) above pursuant to an exercise on or before the Warrant ADS Delivery Date, and if after such date the Holder is required
by its broker to purchase (in an open market transaction or otherwise) or the Holder’s brokerage firm otherwise purchases,
ADSs to deliver in satisfaction of a sale by the Holder of the Warrant ADSs which the Holder anticipated receiving upon such exercise
(a “Buy-In”), then the Company shall (A) pay in cash to the Holder the amount, if any, by which (x) the Holder’s
total purchase price (including brokerage commissions, if any) for the ADSs so purchased exceeds (y) the amount obtained by multiplying
(1) the number of Warrant ADSs that the Company failed to deliver to the Holder in connection with the exercise at issue by (2)
the price at which the sell order giving rise to such purchase obligation was executed, and (B) at the option of the Holder, either
reinstate the portion of the Warrant in respect of the Warrant ADSs for which such exercise was not honored and return any amount
received by the Company in respect of the Exercise Price for those Warrant ADSs (in which case such exercise shall be deemed rescinded)
or deliver to the Holder the number of ADSs that would have been issued had the Company timely complied with its exercise and delivery
obligations hereunder. For example, if the Holder purchases ADSs having a total purchase price of $11,000 to cover a Buy-In with
respect to an attempted exercise of the Warrant with an aggregate sale price giving rise to such purchase obligation of $10,000,
under clause (A) of the immediately preceding sentence the Company shall be required to pay the Holder $1,000. The Holder shall
provide the Company written notice indicating the amounts payable to the Holder in respect of the Buy-In and, upon request of the
Company, evidence of the amount of such loss. Nothing herein shall limit a Holder’s right to pursue any other remedies available
to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with
respect to the Company’s failure to timely deliver ADSs upon exercise of the Warrant as required pursuant to the terms hereof.

 

     

     

    

 

v. No
Fractional Shares or Scrip. No fractional Warrant Shares or Warrant ADSs shall be issued upon the exercise of this Warrant.
As to any fraction of an ADS which the Holder would otherwise be entitled to purchase upon such exercise, the Company shall, at
its election, either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by
the Exercise Price or round up to the next whole ADS; provided, however, the fraction of an ADS shall not be rounded up to the
next whole ADS if such rounding results in the issue price being lower than the nominal value of the ADS.

 

vi. Charges,
Taxes and Expenses. Issuance of Warrant ADSs shall be made without charge to the Holder for any issue or transfer tax or other
incidental expense in respect of the issuance of Warrant ADSs, all of which taxes and expenses shall be paid by the Company, and
such Warrant ADSs shall be issued in the name of the Holder or in such name or names as may be directed by the Holder; provided,
however, that in the event that Warrant ADSs are to be issued in a name other than the name of the Holder, this Warrant
when surrendered for exercise shall be accompanied by the Assignment Form attached hereto duly executed by the Holder and the Company
may require, as a condition thereto, the payment of a sum sufficient to reimburse it for any transfer tax incidental thereto. The
Company shall pay all Depositary fees required for same-day processing of any Notice of Exercise and all fees to the Depository
Trust Company (or another established clearing corporation performing similar functions) required for same-day electronic issuance
and delivery of the Warrant ADSs.

 

vii. Closing
of Books. The Company will not close its shareholder books or records in any manner which prevents the timely exercise of this
Warrant, pursuant to the terms hereof; provided, however, that the foregoing shall not be deemed or construed to limit any rights
of the Depositary under the terms and provisions of the deposit agreement among, inter alia, the Company and the Depositary.

 

e) Holder’s
Exercise Limitations. Notwithstanding anything to the contrary contained herein, the Company shall not effect the exercise
of any portion of this Warrant, and the Holder shall not have the right to exercise any portion of this Warrant, pursuant to the
terms and conditions of this Warrant and any such exercise shall be null and void and treated if never made, to the extent that
after giving effect to such exercise, the Holder together with the other Attribution Parties collectively would beneficially own
in excess of [9.99][4.99]% (the “Maximum Percentage”) of the number of Ordinary Shares outstanding immediately
after giving effect to such exercise. For purposes of the foregoing sentence, the aggregate number of Ordinary Shares beneficially
owned by the Holder and the other Attribution Parties shall include the number of Ordinary Shares underlying ADSs held by the Holder
and all other Attribution Parties plus the number of Ordinary Shares underlying ADSs issuable upon exercise of this Warrant with
respect to which the determination of such sentence is being made, but shall exclude the number of Ordinary Shares underlying ADSs
which would be issuable upon (A) exercise of the remaining, unexercised portion of this Warrant beneficially owned by the Holder
or any of the other Attribution Parties and (B) exercise or conversion of the unexercised or unconverted portion of any other securities
of the Company beneficially owned by the Holder or any other Attribution Party subject to a limitation on conversion or exercise
analogous to the limitation contained in this Section 3(e). For purposes of this Section 3(e), beneficial ownership shall be calculated
in accordance with Section 13(d) of the Exchange Act. For purposes of this Warrant, in determining the number of Ordinary Shares
underlying ADSs the Holder may acquire upon the exercise of this Warrant without exceeding the Maximum Percentage, the Holder may
rely on the number of Ordinary Shares as reflected in (x) the Company’s most recent Annual Report on Form 20-F, Current Report
on Form 6-K or other public filing with the Commission, as the case may be, (y) a more recent public announcement by the Company
or (3) any other written notice by the Company setting forth the number of Ordinary Shares outstanding (the “Reported
Outstanding Share Number”). If the Company receives an Exercise Notice from the Holder at a time when the actual number
of outstanding Ordinary Shares is less than the Reported Outstanding Share Number, the Company shall (i) notify the Holder in writing
of the number of Ordinary Shares then outstanding and, to the extent that such Exercise Notice would otherwise cause the Holder’s
beneficial ownership, as determined pursuant to this Section 2(e), to exceed the Maximum Percentage, the Holder must notify the
Company of a reduced number of Warrant ADSs to be purchased pursuant to such Exercise Notice (the number of shares by which such
purchase is reduced, the “Reduction Shares”) and (ii) as soon as reasonably practicable, the Company shall return
to the Holder any exercise price paid by the Holder for the Reduction Shares. For any reason at any time, upon the written or oral
request of the Holder, the Company shall within one (1) Business Day confirm orally and in writing or by electronic mail to the
Holder the number of Ordinary Shares then outstanding. In any case, the number of outstanding Ordinary Shares shall be determined
after giving effect to the conversion or exercise of securities of the Company, including this Warrant, by the Holder and any other
Attribution Party since the date as of which the Reported Outstanding Share Number was reported. In the event that the issuance
of Ordinary Shares to the Holder upon exercise of this Warrant results in the Holder and the other Attribution Parties being deemed
to beneficially own, in the aggregate, more than the Maximum Percentage of the number of outstanding Ordinary Shares (as determined
under Section 13(d) of the Exchange Act), the Company and the Holder shall use commercially reasonable efforts to procure that
the number of shares so issued by which the Holder’s and the other Attribution Parties’ aggregate beneficial ownership
exceeds the Maximum Percentage (the “Excess Shares”) are repurchased by the Company (out of its distributable
reserves pursuant to a contract duly authorized in accordance with the law, or as it may otherwise be legally permitted from time
to time) for a price equal to the applicable Exercise Price, and pending such repurchase the Holder agrees it shall not exercise
any rights relating to the power to vote or to transfer the Excess Shares. Upon delivery of a written notice to the Company, the
Holder may from time to time increase (with such increase not effective until the sixty-first (61st) day after delivery of such
notice) or decrease the Maximum Percentage to any other percentage not in excess of 9.99% as specified in such notice; provided
that (i) any such increase in the Maximum Percentage will not be effective until the sixty-first (61st) day after such notice is
delivered to the Company and (ii) any such increase or decrease will apply only to the Holder and the other Attribution Parties
and not to any other holder of Warrants that is not an Attribution Party of the Holder. For purposes of clarity, the Ordinary Shares
issuable pursuant to the terms of this Warrant in excess of the Maximum Percentage shall not be deemed to be beneficially owned
by the Holder for any purpose including for purposes of Section 13(d) or Rule 16a-1(a)(1) of the Exchange Act. The provisions of
this paragraph shall be construed and implemented in a manner otherwise than in strict conformity with the terms of this Section
3(e) to the extent necessary to correct this paragraph or any portion of this paragraph which may be defective or inconsistent
with the intended beneficial ownership limitation contained in this Section 2(e) or to make changes or supplements necessary or
desirable to properly give effect to such limitation. The limitation contained in this paragraph may not be waived and shall apply
to a successor holder of this Warrant. “Attribution Parties” means, collectively, the following Persons and
entities: (i) any investment vehicle, including, any funds, feeder funds or managed accounts, currently, or from time to time after
the issuance date, directly or indirectly managed or advised by the Holder’s investment manager or any of its Affiliates
or principals, (ii) any direct or indirect Affiliates of the Holder or any of the foregoing, (iii) any Person acting or who could
be deemed to be acting as a group together with the Holder or any of the foregoing and (iv) any other Persons whose beneficial
ownership of the Company’s Ordinary Shares would or could be aggregated with the Holder’s and the other Attribution
Parties for purposes of Section 13(d) of the Exchange Act. For clarity, the purpose of the foregoing is to subject collectively
the Holder and all other Attribution Parties to the Maximum Percentage.

 

     

     

    

 

f) Call Provision. Subject
to the provisions of Section 2(e) and this Section 2(f), if, after the Initial Exercise Date, (i) the VWAP for each of 10 consecutive
Trading Days (the “Measurement Period,” which 10 consecutive Trading Day period shall not have commenced until
after the Initial Exercise Date) exceeds $3.30 (subject to adjustment for forward and reverse stock splits, recapitalizations,
stock dividends and the like after the Initial Exercise Date), (ii) the average daily volume for such Measurement Period exceeds
$100,000 per Trading Day (subject to adjustment for forward and reverse stock splits, recapitalizations, stock dividends and the
like after the Initial Exercise Date) and (iii) the Holder is not in possession of any information that constitutes, or might constitute,
material non-public information which was provided by the Company, any of its Subsidiaries, or any of their officers, directors,
employees, agents or Affiliates, then the Company may, within 1 Trading Day of the end of such Measurement Period, call for cancellation
of all or any portion of this Warrant for which a Notice of Exercise has not yet been delivered (such right, a “Call”)
for consideration equal to $.001 per Warrant Share. To exercise this right, the Company must deliver to the Holder an irrevocable
written notice (a “Call Notice”), indicating therein the portion of unexercised portion of this Warrant to which
such notice applies. If the conditions set forth below for such Call are satisfied from the period from the date of the Call Notice
through and including the Call Date (as defined below), then any portion of this Warrant subject to such Call Notice for which
a Notice of Exercise shall not have been received by the Call Date will be cancelled at 6:30 p.m. (New York City time) on the tenth
Trading Day after the date the Call Notice is received by the Holder (such date and time, the “Call Date”).
Any unexercised portion of this Warrant to which the Call Notice does not pertain will be unaffected by such Call Notice. In furtherance
thereof, the Company covenants and agrees that it will honor all Notices of Exercise with respect to Warrant Shares subject to
a Call Notice that are tendered through 6:30 p.m. (New York City time) on the Call Date. The parties agree that any Notice of Exercise
delivered following a Call Notice which calls less than all of the Warrants shall first reduce to zero the number of Warrant Shares
subject to such Call Notice prior to reducing the remaining Warrant Shares available for purchase under this Warrant. For example,
if (A) this Warrant then permits the Holder to acquire 100 Warrant Shares, (B) a Call Notice pertains to 75 Warrant Shares, and
(C) prior to 6:30 p.m. (New York City time) on the Call Date the Holder tenders a Notice of Exercise in respect of 50 Warrant Shares,
then (x) on the Call Date the right under this Warrant to acquire 25 Warrant Shares will be automatically cancelled, (y) the Company,
in the time and manner required under this Warrant, will have issued and delivered to the Holder 50 Warrant Shares in respect of
the exercises following receipt of the Call Notice, and (z) the Holder may, until the Termination Date, exercise this Warrant for
25 Warrant Shares (subject to adjustment as herein provided and subject to subsequent Call Notices). Subject again to the provisions
of this Section 2(f), the Company may deliver subsequent Call Notices for any portion of this Warrant for which the Holder shall
not have delivered a Notice of Exercise. Notwithstanding anything to the contrary set forth in this Warrant, the Company may not
deliver a Call Notice or require the cancellation of this Warrant (and any such Call Notice shall be void), unless, from the beginning
of the Measurement Period through the Call Date, (1) the Company shall have honored in accordance with the terms of this Warrant
all Notices of Exercise delivered by 6:30 p.m. (New York City time) on the Call Date, and (2) a registration statement shall be
effective as to all Warrant Shares and the prospectus thereunder available for use by the Company for the sale of all such Warrant
Shares to the Holder, and (3) the ADSs shall be listed or quoted for trading on the Trading Market, and (4) the directors of the
Company have authority to allot a sufficient number of shares to provide for the issuance of the Warrant ADSs and underlying Ordinary
Shares upon the exercise of any purchase rights under this Warrant, and (5) the issuance of all Warrant Shares subject to a Call
Notice shall not cause a breach of any provision of Section 2(e) herein. The Company’s right to call the Warrants under this
Section 2(f) shall be exercised ratably among the Holders based on each Holder’s initial purchase of Warrants.

 

     

     

    

 

Section 3. Certain
Adjustments.

 

a) Share
Dividends and Splits. If the Company, at any time while this Warrant is outstanding: (i) pays a share dividend or otherwise
makes a distribution or distributions on its Ordinary Shares or ADSs or any other equity or equity equivalent securities payable
in Ordinary Shares or ADSs (which, for avoidance of doubt, shall not include any ADSs issued by the Company upon exercise of this
Warrant), as applicable, (ii) subdivides outstanding Ordinary Shares or ADSs into a larger number of shares or ADSs, as applicable,
(iii) combines (including by way of reverse share split) outstanding Ordinary Shares or ADSs into a smaller number of shares or
ADSs, as applicable, (iv) redesignates any other securities as Ordinary Shares or ADSs or (v) issues Ordinary Shares or ADSs by
way of capitalization of profits or reserves, then in each case the Exercise Price shall be multiplied by a fraction of which the
numerator shall be the number of ADSs (excluding treasury shares, if any) outstanding immediately before such event and of which
the denominator shall be the number of ADSs outstanding immediately after such event, and the number of shares issuable upon exercise
of this Warrant shall be proportionately adjusted so that the aggregate Exercise Price of this Warrant shall remain unchanged.
Any adjustment made pursuant to this Section 3(a) shall become effective immediately after the record date or (if there is no record
date) the effective date of the transaction giving rise to the adjustment.

 

b) [RESERVED]

 

c) Subsequent
Rights Offerings. In addition to any adjustments pursuant to Section 3(a) above, if at any time the Company grants, issues
or sells any Ordinary Share Equivalents or rights to purchase shares, warrants, securities or other property pro rata to the record
holders of any class of Ordinary Shares or ADSs (the “Purchase Rights”), then the Holder will be entitled to
acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired
if the Holder had held the number of Ordinary Shares or ADSs acquirable upon complete exercise of this Warrant (without regard
to any limitations on exercise hereof, including without limitation, the Maximum Percentage) immediately before the date on which
a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which
the record holders of Ordinary Shares or ADSs are to be determined for the grant, issue or sale of such Purchase Rights (provided,
however, to the extent that the Holder’s right to participate in any such Purchase Right would result in the Holder exceeding
the Maximum Percentage, then the Holder shall not be entitled to participate in such Purchase Right to such extent (or beneficial
ownership of such ADSs as a result of such Purchase Right to such extent) and such Purchase Right to such extent shall be held
in abeyance for the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Maximum
Percentage).

 

d) Pro
Rata Distributions. Except to the extent that the adjustments pursuant to Section 3(a) above apply, during such time as this
Warrant is outstanding, if the Company shall declare or make any dividend or other distribution of its assets (or rights to acquire
its assets) to holders of Ordinary Shares or ADSs, by way of return of capital or otherwise (including, without limitation, any
distribution of cash, shares or other securities, property or options by way of a dividend, spin off, reclassification, corporate
rearrangement, scheme of arrangement or other similar transaction) (a “Distribution”), at any time after the
issuance of this Warrant, then, in each such case, the Holder shall be entitled to receive at the time such Distribution is made
the amount of cash or assets that are distributed in the Distribution per Ordinary Share or ADS multiplied by the number of Ordinary
Shares or ADSs acquirable upon complete exercise of this Warrant (without regard to any limitations on exercise hereof, including
without limitation, the Maximum Percentage) immediately before the date of which a record is taken for such Distribution, or, if
no such record is taken, the date as of which the record holders of Ordinary Shares or ADSs are to be determined for the participation
in such Distribution (provided, however, that the Holder shall not be entitled to receive any Ordinary Shares or
ADSs pursuant to the foregoing right to the extent that this would result in the Holder exceeding the Maximum Percentage, and any
such Ordinary Shares or ADSs shall be held in abeyance for the benefit of the Holder until such time, if ever, as its right thereto
would not result in the Holder exceeding the Maximum Percentage).

 

     

     

    

 

e) Fundamental
Transactions. If, at any time while this Warrant is outstanding, (i) the Company,
directly or indirectly, in one or more related transactions effects any merger or consolidation of the Company with or into another
Person, (ii) the Company, directly or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other
disposition of all or substantially all of its assets in one or a series of related transactions, (iii) any, direct or indirect,
purchase offer, tender offer or exchange offer (whether by the Company or another Person) is completed pursuant to which holders
of Ordinary Shares are permitted to sell, tender or exchange their shares for other securities, cash or property and has been accepted
by the holders of 50% or more of the outstanding Ordinary Shares, (iv) the Company, directly or indirectly, in one or more
related transactions effects any reclassification, reorganization or recapitalization of the Ordinary Shares or any compulsory
share exchange pursuant to which the Ordinary Shares is effectively converted into or exchanged for other securities, cash or property,
or (v) the Company, directly or indirectly, in one or more related transactions consummates a stock or share purchase agreement
or other business combination (including, without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement)
with another Person or group of Persons whereby such other Person or group acquires more than 50% of the outstanding Ordinary Shares
(not including any Ordinary Shares held by the other Person or other Persons making or party to, or associated or affiliated with
the other Persons making or party to, such stock or share purchase agreement or other business combination) (each a “Fundamental
Transaction”), then, upon any subsequent exercise of this Warrant, the Holder shall have the right to receive, for each
Warrant Share that would have been issuable upon such exercise immediately prior to the occurrence of such Fundamental Transaction,
at the option of the Holder (without regard to any limitation in Section 2(e) on the exercise of this Warrant), the number
of shares of the successor or acquiring corporation or of the Company, if it is the surviving corporation, and/or any additional
consideration (the “Alternate Consideration “) receivable as a result of such Fundamental Transaction by
a holder of the number of Ordinary Shares for which this Warrant is exercisable immediately prior to such Fundamental Transaction
(without regard to any limitation in Section 2(e) on the exercise of this Warrant). For purposes of any such exercise,
the determination of the Exercise Price shall be appropriately adjusted to apply to such Alternate Consideration based on the amount
of Alternate Consideration issuable in respect of one Ordinary Share in such Fundamental Transaction, and the Company shall apportion
the Exercise Price among the Alternate Consideration in a reasonable manner reflecting the relative value of any different components
of the Alternate Consideration. If holders of Ordinary Shares are given any choice as to the securities, cash or property to be
received in a Fundamental Transaction, then the Holder shall be given the same choice as to the Alternate Consideration it receives
upon any exercise of this Warrant following such Fundamental Transaction. The Company shall cause any successor entity in a Fundamental
Transaction in which the Company is not the survivor (the “Successor Entity”) to assume in writing all of the
obligations of the Company under this Warrant in accordance with the provisions of this Section 3(d) pursuant to written
agreements in form and substance reasonably satisfactory to the Holder and approved by the Holder (without unreasonable delay)
prior to such Fundamental Transaction and shall, at the option of the Holder, deliver to the Holder in exchange for this Warrant
a security of the Successor Entity evidenced by a written instrument substantially similar in form and substance to this Warrant
which is exercisable for a corresponding number of shares of capital stock of such Successor Entity (or its parent entity) equivalent
to the Ordinary Shares acquirable and receivable upon exercise of this Warrant (without regard to any limitations on the exercise
of this Warrant) prior to such Fundamental Transaction, and with an Exercise price which applies the Exercise Price hereunder to
such shares of capital stock (but taking into account the relative value of the Ordinary Shares pursuant to such Fundamental Transaction
and the value of such shares of capital stock, such number of shares of capital stock and such exercise price being for the purpose
of protecting the economic value of this Warrant immediately prior to the consummation of such Fundamental Transaction), and which
is reasonably satisfactory in form and substance to the Holder. Upon the occurrence of any such Fundamental Transaction, the Successor
Entity shall succeed to, and be substituted for (so that from and after the date of such Fundamental Transaction, the provisions
of this Warrant referring to the “Company” shall refer instead to the Successor Entity), and may exercise every right
and power of the Company and shall assume all of the obligations of the Company under this Warrant with the same effect as if such
Successor Entity had been named as the Company herein.

 

f) Calculations.
All calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of an ADS, as the case may be. For
purposes of this Section 3, the number of Ordinary Shares deemed to be issued and outstanding as of a given date shall be the sum
of the number of Ordinary Shares (excluding treasury shares, if any) issued and outstanding.

 

g) Notice
to Holder.

 

i. Adjustment
to Exercise Price. Whenever the Exercise Price is adjusted pursuant to any provision of this Section 3, the Company shall promptly
mail to the Holder a notice setting forth the Exercise Price after such adjustment and any resulting adjustment to the number of
Warrant ADSs and setting forth a brief statement of the facts requiring such adjustment.

 

     

     

    

 

ii. Notice
to Allow Exercise by Holder. If (A) the Company shall declare a dividend (or any other distribution in whatever form) on the
Ordinary Shares, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Ordinary Shares or
ADSs, (C) the Company shall authorize the granting to all holders of the Ordinary Shares or ADSs rights or warrants to subscribe
for or purchase any shares of capital stock of any class or of any rights, (D) the approval of any shareholders of the Company
shall be required in connection with any reclassification of the Ordinary Shares or ADSs, any consolidation or merger to which
the Company is a party, any sale or transfer of all or substantially all of the assets of the Company, or any compulsory share
exchange whereby the Ordinary Shares are converted into other securities, cash or property, or (E) the Company shall authorize
the voluntary or involuntary dissolution, liquidation or winding up of the affairs of the Company, then, in each case, the Company
shall cause to be mailed to the Holder at its last address as it shall appear upon the Warrant Register of the Company, at least
20 calendar days prior to the applicable record or effective date hereinafter specified, a notice stating (x) the date on which
a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants, or if a record is not to
be taken, the date as of which the holders of the Ordinary Shares or ADSs of record to be entitled to such dividend, distributions,
redemption, rights or warrants are to be determined or (y) the date on which such reclassification, consolidation, merger, sale,
transfer or share exchange is expected to become effective or close, and the date as of which it is expected that holders of the
Ordinary Shares of record shall be entitled to exchange their Ordinary Shares for securities, cash or other property deliverable
upon such reclassification, consolidation, merger, sale, transfer or share exchange; provided that the failure to mail such notice
or any defect therein or in the mailing thereof shall not affect the validity of the corporate action required to be specified
in such notice. To the extent that any notice provided in this Warrant constitutes, or contains, material, non-public information
regarding the Company or any of the Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant
to a Report on Form 6-K. The Holder shall remain entitled to exercise this Warrant during the period commencing on the date of
such notice to the effective date of the event triggering such notice except as may otherwise be expressly set forth herein.

 

 

Section 4. Transfer
of Warrant.

 

a) Transferability.
Subject to compliance with any applicable securities laws and the conditions set forth in Section 4(d) hereof and to the provisions
of Section 4.1 of the Purchase Agreements, this Warrant and all rights hereunder are transferable, in whole or in part, upon surrender
of this Warrant at the principal office of the Company or its designated agent, together with a written assignment of this Warrant
substantially in the form attached hereto duly executed by the Holder or its agent or attorney and funds sufficient to pay any
transfer taxes payable upon the making of such transfer. Upon such surrender and, if required, such payment, the Company shall
execute and deliver a new Warrant or Warrants in the name of the assignee or assignees, as applicable, and in the denomination
or denominations specified in such instrument of assignment, and shall issue to the assignor a new Warrant evidencing the portion
of this Warrant not so assigned, and this Warrant shall promptly be cancelled. Notwithstanding anything herein to the contrary,
the Holder shall not be required to physically surrender this Warrant to the Company unless the Holder has assigned this Warrant
in full, in which case, the Holder shall surrender this Warrant to the Company within three (3) Trading Days of the date the Holder
delivers an assignment form to the Company assigning this Warrant in full. The Warrant, if properly assigned in accordance herewith,
may be exercised by a new holder for the purchase of Warrant ADSs without having a new Warrant issued.

 

b) New
Warrants. This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of the
Company, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by
the Holder or its agent or attorney. Subject to compliance with Section 4(a), as to any transfer which may be involved in such
division or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants
to be divided or combined in accordance with such notice. All Warrants issued on transfers or exchanges shall be dated the Issue
Date and shall be identical with this Warrant except as to the number of Warrant ADSs issuable pursuant thereto.

 

c) Warrant
Register. The Company shall register this Warrant, upon records to be maintained by the Company for that purpose (the “Warrant
Register”), in the name of the record Holder hereof from time to time. The Company may deem and treat the registered
Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder, and
for all other purposes, absent actual notice to the contrary.

 

d) Transfer
Restrictions. If, at the time of the surrender of this Warrant in connection with any transfer of this Warrant, the transfer
of this Warrant shall not be either (i) registered pursuant to an effective registration statement under the Securities Act and
under applicable state securities or blue sky laws or (ii) eligible for resale without volume or manner-of-sale restrictions or
current public information requirements pursuant to Rule 144, the Company may require, as a condition of allowing such transfer,
that the Holder or transferee of this Warrant, as the case may be, comply with the provisions of the Purchase Agreements, including
Section 4.13 thereof.

 

     

     

    

 

e) Representation
by the Holder. The Holder, by the acceptance hereof, represents and warrants that it is acquiring this Warrant and, upon any
exercise hereof, will acquire the Warrant ADSs issuable upon such exercise, for its own account and not with a view to or for distributing
or reselling such Warrant ADSs or any part thereof in violation of the Securities Act or any applicable state securities law, except
pursuant to sales registered or exempted under the Securities Act.

 

Section 5. Miscellaneous.

 

a) Legends.
The Holder agrees to the provisions of section 4.1 of the Purchase Agreements, including the restrictive legends and restrictions
on transfer.

 

b) No
Rights as Shareholder Until Exercise. This Warrant does not entitle the Holder to any voting rights, dividends or other rights
as a shareholder of the Company prior to the exercise hereof as set forth in Section 2(d)(i), except as expressly set forth in
Section 3.

 

c) Loss,
Theft, Destruction or Mutilation of Warrant. The Company covenants that upon receipt by the Company of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any stock certificate relating to the Warrant
ADSs, and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of
the Warrant, shall not include the posting of any bond), and upon surrender and cancellation of such Warrant or stock certificate,
if mutilated, the Company will make and deliver a new Warrant or stock certificate of like tenor and dated as of such cancellation,
in lieu of such Warrant or stock certificate.

 

d) Saturdays,
Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required or
granted herein shall not be a Business Day, then, such action may be taken or such right may be exercised on the next succeeding
Business Day.

 

e) Authorized
Shares.

 

The Company
covenants that, during the period the Warrant is outstanding, its directors will have authority to allot a sufficient number of
shares to provide for the issuance of the Warrant ADSs and underlying Ordinary Shares upon the exercise of any purchase rights
under this Warrant. The Company further covenants that its issuance of this Warrant shall constitute full authority to its officers
who are charged with the duty of issuing the necessary Warrant Shares upon the exercise of the purchase rights under this Warrant.
The Company will take all such reasonable action as may be necessary to assure that such Warrant ADSs may be issued as provided
herein without violation of any applicable law or regulation, or of any requirements of the applicable Trading Market upon which
the Ordinary Shares and ADSs may be listed. The Company covenants that all Warrant Shares which may be issued upon the exercise
of the purchase rights represented by this Warrant will, upon exercise of the purchase rights represented by this Warrant and payment
for such Warrant ADSs in accordance herewith, be duly authorized, validly issued, fully paid and nonassessable and free from all
taxes, liens and charges created by the Company in respect of the issue thereof (other than taxes in respect of any transfer occurring
contemporaneously with such issue).

 

Except and
to the extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending
its certificate of incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or
sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this
Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions
as may be necessary or appropriate to protect the rights of Holder as set forth in this Warrant against impairment. Without limiting
the generality of the foregoing, the Company will (i) not increase the par value of any Warrant Shares above the amount payable
therefor upon such exercise immediately prior to such increase in par value, (ii) take all such action as may be necessary or appropriate
in order that the Company may validly and legally issue fully paid and nonassessable Warrant Shares upon the exercise of this Warrant
and (iii) use commercially reasonable efforts to obtain all such authorizations, exemptions or consents from any public regulatory
body having jurisdiction thereof, as may be, necessary to enable the Company to perform its obligations under this Warrant.

 

Before taking
any action which would result in an adjustment in the number of Warrant ADSs for which this Warrant is exercisable or in the Exercise
Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from any
public regulatory body or bodies having jurisdiction thereof. Unless required by law, the Company shall not do anything that would
require the Exercise Price to be adjusted to an amount that is less than the nominal value of an ADS at that time.

 

     

     

    

 

f) Jurisdiction.
All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be determined in accordance
with the provisions of the Purchase Agreements.

 

g) Restrictions.
The Holder acknowledges that the Warrant, and the Warrant Shares and the Warrant ADSs acquired upon the exercise of this Warrant,
if not registered, will have restrictions upon resale imposed by state and federal securities laws.

 

h) Nonwaiver
and Expenses. No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall operate
as a waiver of such right or otherwise prejudice the Holder’s rights, powers or remedies, notwithstanding the fact that all
rights hereunder terminate on the Termination Date. If the Company willfully and knowingly fails to comply with any provision of
this Warrant, which results in any material damages to the Holder, the Company shall pay to the Holder such amounts as shall be
sufficient to cover any costs and expenses including, but not limited to, reasonable attorneys’ fees, including those of
appellate proceedings, incurred by the Holder in collecting any amounts due pursuant hereto or in otherwise enforcing any of its
rights, powers or remedies hereunder.

 

i) Notices.
Any notice, request or other document required or permitted to be given or delivered to the Holder by the Company shall be delivered
in accordance with the notice provisions of the Purchase Agreements.

 

j) Limitation
of Liability. No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant to purchase
Warrant ADSs, and no enumeration herein of the rights or privileges of the Holder, shall give rise to any liability of the Holder
for the purchase price of any Ordinary Shares or ADSs or as a shareholder of the Company, whether such liability is asserted by
the Company or by creditors of the Company.

 

k) Remedies.
The Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled
to specific performance of its rights under this Warrant. The Company agrees that monetary damages would not be adequate compensation
for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees to waive and not to assert
the defense in any action for specific performance that a remedy at law would be adequate.

 

l) Depositary.
For the avoidance of doubt, notwithstanding anything to the contrary contained herein, the Depositary’s rights and obligations
with respect to the Company and the ADSs (including the Warrant ADSs) shall be as set forth in, and subject to, the terms and provisions
of the deposit agreement among, inter alia, the Company and the Depositary and in no event shall this Warrant be deemed
or construed to impose any additional obligations or liabilities on the Depositary.

 

m) Successors
and Assigns. Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall inure
to the benefit of and be binding upon the successors and permitted assigns of the Company and the successors and permitted assigns
of Holder. The provisions of this Warrant are intended to be for the benefit of any Holder from time to time of this Warrant and
shall be enforceable by the Holder or holder of Warrant ADSs.

 

n) Amendment.
This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company and the Holder.

 

o) Severability.
Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid under applicable
law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall be ineffective
to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining provisions
of this Warrant.

 

p) Headings.
The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of
this Warrant.

 

********************

(Signature Page Follows)

 

 

 

     

     

    

 

IN WITNESS WHEREOF, the
Company has caused this Warrant to be executed by its officer thereunto duly authorized as of the date first above indicated.

 

	 	AKARI THERAPEUTICS, PLC
	 	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:

 

 

 

 

 

 

 

     

     

    

 

NOTICE OF EXERCISE

 

 

	 	To:	AKARI THERAPEUTICS, PLC

Deutsche
Bank TRUST COMPANY AMERICAS, AS DEPOSITARY

 

(1) The undersigned hereby
elects to purchase ________ Warrant ADSs of the Company pursuant to the terms of the attached Warrant (only if exercised in full),
and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes, if any.

 

(2) Payment shall take
the form of (check applicable box):

 

☐
in lawful money of the United States; or

 

☐
if permitted the cancellation of such number of Warrant ADSs as is necessary, in accordance with the formula set forth in subsection
2(c), to exercise this Warrant with respect to the maximum number of Warrant ADSs purchasable pursuant to the cashless exercise
procedure set forth in subsection 2(c).

 

(3) Please register and
issue said Warrant ADSs in the name of the undersigned or in such other name as is specified below:

 

For Warrant ADSs not bearing a restrictive
legend

DTC Participant name and number:
________________________

Contact of DTC Participant: ___________________________

Telephone Number of Participant
Contact: _____________________

 

For Warrant ADSs bearing a restrictive
legend

Name:_______________________________

Address:______________________________

Tax ID:_______________________________

Telephone Number of Holder:______________

 

(4) Accredited Investor.
If the Warrant is being exercised via cash exercise, the undersigned is an “accredited investor” as defined in Regulation
D promulgated under the Securities Act of 1933, as amended.

 

[SIGNATURE
OF HOLDER]

 

Name of Investing Entity: ________________________________________________________________________

Signature of Authorized Signatory of
Investing Entity: _________________________________________________

Name of Authorized Signatory: ___________________________________________________________________

Title of Authorized Signatory: ____________________________________________________________________

Date: ________________________________________________________________________________________

 

     

     

    

 

EXHIBIT B

 

ASSIGNMENT FORM

 

(To assign the
foregoing Warrant, execute this form and supply required information. Do not use this form to purchase Warrant ADSs.)

 

FOR VALUE RECEIVED,
the foregoing Warrant and all rights evidenced thereby are hereby assigned to

 

	Name:	 
	 	(Please Print)
	 	 
	Address:	 
	 	(Please Print)
	 	 
	Dated: _______________ __, ______	 
	 	 
	Holder’s Signature: _________________	 
	 	 
	Holder’s Address: __________________ck1698538-ex101_6.htm

Exhibit 10.1

FOURTH AMENDMENT TO SECOND AMENDED AND RESTATED 
CREDIT AGREEMENT

THIS FOURTH AMENDMENT TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT (this “Amendment”) dated effective as of the 27th day of February, 2020 by and between SSSHT OPERATING PARTNERSHIP, L.P., a Delaware limited partnership (“SSSHTOP”), H. MICHAEL SCHWARTZ, a California resident (“Individual Borrower”), NOBLE PPS, LLC, a Nevada limited liability company (“Noble”), SMARTSTOP ASSET MANAGEMENT, LLC, a Delaware limited liability company (“SAM”), each with an address at 10 Terrace Road, Ladera Ranch, California 92694 (collectively, “Borrower”) and KEYBANK NATIONAL ASSOCIATION, a national banking association having an address at 225 Franklin Street, 16th Floor, Boston, Massachusetts (“Lender”).

W I T N E S S E T H

WHEREAS, Borrower and Lender are parties to that certain Second Amended and Restated Credit Agreement dated as of February 23, 2018, as amended by that certain First Credit Agreement Supplement and Amendment dated as of the Portland Closing Date, as further amended by that certain Joinder Agreement and Second Amendment to Second Amended and Restated Credit Agreement, each dated as of March 29, 2019 and by that certain Third Amendment to Second Amended and Restated Credit Agreement dated as of December 4, 2019 (collectively, the “Original Agreement”, and as amended by this Amendment, the “Credit Agreement”);

WHEREAS, Lender and Borrower have agreed to execute and deliver this Amendment.

NOW, THEREFORE, in consideration of the premises, Borrower hereby agrees with Lender as follows:

1.Defined Terms; Amendments to Credit Agreement.  

(a)Unless otherwise defined herein, terms which are defined in the Original Agreement and used herein are so used as so defined, and the following terms shall have the following meanings.

(b)The following definitions are hereby added to Section 1.01 of the Original Credit Agreement in their entirety in the proper alphabetical order:

“Base Rate Loan” means all or a portion of the Loan bearing interest based upon the Adjusted Base Rate.

‎“Base Rate Principal” means, at any time, the Principal Debt minus the ‎portion, if any, of such Principal Debt which is LIBOR Rate Principal.‎

“Benchmark Replacement” means the sum of: (a) the alternate benchmark rate (which may include Term SOFR) that has been selected by Lender and Borrower giving due consideration to (i) any selection or recommendation of a replacement rate or the mechanism for determining such a rate by the Relevant Governmental Body or (ii) any evolving or then-prevailing market convention for determining a rate of interest as a replacement to the LIBOR Rate for U.S. dollar-denominated syndicated credit facilities at such time and (b) the Benchmark Replacement 

 

82001324v.7

 

Adjustment; provided that, if the Benchmark Replacement as so determined would be less than zero, the Benchmark Replacement will be deemed to be zero for the purposes of this Note.

“Benchmark Replacement Adjustment” means, with respect to any replacement of the LIBOR Rate with an Unadjusted Benchmark Replacement for each applicable Interest Period, the spread adjustment, or method for calculating or determining such spread adjustment (which may be a positive or negative value or zero) that has been selected by Lender and Borrower giving due consideration to (i) any selection or recommendation of a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of the LIBOR Rate with the applicable Unadjusted Benchmark Replacement by the Relevant Governmental Body or (ii) any evolving or then-prevailing market convention for determining a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of the LIBOR Rate with the applicable Unadjusted Benchmark Replacement for U.S. dollar-denominated syndicated credit facilities at such time.

“Benchmark Replacement Conforming Changes” means, with respect to any Benchmark Replacement, any technical, administrative or operational changes (including changes to the definition of “Base Rate,” the definition of “Interest Period,” timing and frequency of determining rates and making payments of interest and other administrative matters) that Lender decides may be appropriate to reflect the adoption and implementation of such Benchmark Replacement and to permit the administration thereof by Lender in a manner substantially consistent with market practice (or, if Lender decides that adoption of any portion of such market practice is not administratively feasible or if Lender determines that no market practice for the administration of the Benchmark Replacement exists, in such other manner of administration as Lender decides is reasonably necessary in connection with the administration of the Loan Documents).

“Benchmark Replacement Date” means the earlier to occur of the following events with respect to the LIBOR Rate: (1) in the case of clause (1) or (2) of the definition of “Benchmark Transition Event,” the later of (a) the date of the public statement or publication of information referenced therein and (b) the date on which the administrator of the LIBOR Rate permanently or indefinitely ceases to provide the LIBOR Rate; or (2) in the case of clause (3) of the definition of “Benchmark Transition Event,” the date of the public statement or publication of information referenced therein.

“Benchmark Transition Event” means the occurrence of one or more of the following events with respect to the LIBOR Rate: 

(1)a public statement or publication of information by or on behalf of the administrator of the LIBOR Rate announcing that such administrator has ceased or will cease to provide the LIBOR Rate, permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide the LIBOR Rate;

(2)a public statement or publication of information by the regulatory supervisor for the administrator of the LIBOR Rate, the U.S. Federal Reserve System, an insolvency official with jurisdiction over the administrator for the LIBOR Rate, a resolution authority with jurisdiction over the administrator for the LIBOR Rate or a court or an entity with similar insolvency or resolution authority over the administrator for the LIBOR Rate, which states that the administrator of the LIBOR Rate has ceased or will cease to provide the LIBOR Rate permanently or indefinitely, provided that, at the time of 

-2-

82001324v.7

 

such statement or publication, there is no successor administrator that will continue to provide the LIBOR Rate; or

(3)a public statement or publication of information by the regulatory supervisor for the administrator of the LIBOR Rate or a Relevant Governmental Body announcing that the LIBOR Rate is no longer representative.

“Benchmark Transition Start Date” means (a) in the case of a Benchmark Transition Event, the earlier of (i) the applicable Benchmark Replacement Date and (ii) if such Benchmark Transition Event is a public statement or publication of information of a prospective event, the 90th day prior to the expected date of such event as of such public statement or publication of information (or if the expected date of such prospective event is fewer than 90 days after such statement or publication, the date of such statement or publication) and (b) in the case of an Early Opt-in Election, the date specified by Lender by notice to Borrower.

“Benchmark Unavailability Period” means, if a Benchmark Transition Event and its related Benchmark Replacement Date have occurred with respect to the LIBOR Rate and solely to the extent that the LIBOR Rate has not been replaced with a Benchmark Replacement, the period (x) beginning at the time that such Benchmark Replacement Date has occurred if, at such time, no Benchmark Replacement has replaced the LIBOR Rate for all purposes hereunder in accordance with Section 2.11 and (y) ending at the time that a Benchmark Replacement has replaced the LIBOR Rate for all purposes hereunder pursuant to Section 2.11.

‎“Daily Floating LIBOR Rate” means the average rate (rounded upwards to ‎the nearest 1/16th) as shown by Reuters at which deposits in U.S. dollars are offered ‎by first class banks in the London Interbank Market for the “one month” LIBOR ‎Rate at approximately 11:00 a.m. (London time) on the day that is two (2) LIBOR ‎Business Days prior to the date of determination of such Daily Floating LIBOR ‎Rate, adjusted for reserves and taxes if required by the applicable regulations.  If ‎Reuters no longer reports such rate or Lender determines in good faith that the rate ‎so reported no longer accurately reflects the rate available to Lender in the London ‎Interbank Market, Lender may select a replacement index.‎

‎“Early Opt-in Election” means the occurrence of: (1) a determination by ‎Lender that U.S. dollar-denominated syndicated credit facilities being executed at ‎such time, or that include language similar to that contained in Section 2.11(c) are ‎being executed or amended, as applicable, to incorporate or adopt a new benchmark ‎interest rate to replace the LIBOR Rate, and (2) the election by Lender to declare ‎that an Early Opt-in Election has occurred and the provision by Lender of written ‎notice of such election to Borrower.‎

‎“Federal Reserve Bank of New York’s Website” means the website of the ‎Federal Reserve Bank of New York at http://www.newyorkfed.org, or any successor ‎source.‎

“Fourth Amendment” means that certain Fourth Amendment to Second Amended and Restated Credit Agreement dated as of the Fourth Amendment Date by and between Borrower and Lender.

“Fourth Amendment Date” means February 27, 2020.

“Fourth Amendment Date Net Worth” means the Net Worth (SSSHT) as of December 31, 2019, as disclosed to Lender in writing on or before the Fourth Amendment Date.

-3-

82001324v.7

 

“Fourth Amendment Extension Fee” has the meaning set forth in Section 2.09(g).

“LIBOR Business Day” means a Business Day on which dealings in U.S. dollars are carried on in the London Interbank Market.

“LIBOR Loan” means all or a portion of the Loan bearing interest based upon the Adjusted LIBOR Rate.

‎“Principal Debt” means the aggregate unpaid principal balance of the Note at the ‎time in question.

‎“Relevant Governmental Body” means the Federal Reserve Board and/or the ‎Federal Reserve Bank of New York, or a committee officially endorsed or convened by the ‎Federal Reserve Board and/or the Federal Reserve Bank of New York or any successor ‎thereto, including without limitation the Alternative Reference Rates Committee.

“SOFR” with respect to any day means the secured overnight financing rate published for such day by the Federal Reserve Bank of New York, as the administrator of the benchmark, (or a successor administrator) on the Federal Reserve Bank of New York’s Website.

“Term SOFR” means the forward-looking term rate based on SOFR that has been selected or recommended by the Relevant Governmental Body.

“Tribunal” means any state, commonwealth, federal, foreign, territorial or other court or governmental department, commission, board, bureau, district, authority, agency, central bank, or instrumentality, or any arbitration authority.

“Unadjusted Benchmark Replacement” means the Benchmark Replacement excluding the Benchmark Replacement Adjustment.

(c)The following definitions set forth in the Original Agreement are hereby amended and restated in their entirety to read as follows:

‎“Adjusted Base Rate” means an interest rate per annum per equal to the greater of ‎‎(a) the Base Rate plus the Base Rate Margin, or (b) the LIBOR Rate Margin.  Any change in ‎the Adjusted Base Rate shall be effective immediately from and after a change in the ‎Adjusted Base Rate (or the Federal Funds Effective Rate, as applicable).

“Adjusted LIBOR Rate” means for any Interest Period, an interest rate per annum equal to (a) the rate obtained by dividing (x) the LIBOR Rate for such Interest Period by (y) a percentage equal to one (1.00) minus the Reserve Percentage for such Interest Rate Period plus (b) the LIBOR Rate Margin. ‎

‎“Base Rate” means for any day, a fluctuating interest rate per annum as shall be in ‎effect from time to time which rate per annum shall at all times be equal to the greatest of: ‎‎(a) the rate of interest established by KeyBank National Association, from time to time, as ‎its “prime rate,” whether or not publicly announced, which interest rate may or may not be ‎the lowest rate charged by it for commercial loans or other extensions of credit; (b) the ‎Federal Funds Effective Rate in effect from time to time, determined one Business Day in arrears, ‎plus 1/2 of 1% per annum; and (c) the then applicable LIBOR Rate for one month interest ‎periods plus 1.00% per annum.‎

-4-

82001324v.7

 

‎“Daily LIBOR Rate” means on any day, for any LIBOR Rate Principal, a ‎simple rate per annum equal to (a) the Daily Floating LIBOR Rate plus (b) the ‎LIBOR Rate Margin.

‎“Interest Period” means with respect to each amount bearing ‎interest at the Adjusted LIBOR Rate, the period commencing on the date such ‎amount is disbursed, continued or converted, and ending on the date one (1), two ‎‎(2) or three (3) month(s) thereafter (to the extent deposits which such maturities are ‎available to Lender), as selected by Borrower by written notice to Lender, no more ‎than three (3) Business Days prior to the first day of such period; provided that:‎

	
 
	
(i)‎
	
Each Interest Period must commence on a LIBOR ‎Business Day;‎

	
 
	
‎(ii)‎
	
In the case of the continuation of the Adjusted LIBOR Rate, the ‎Interest Period applicable after the continuation of such amount shall ‎commence on the last day of the preceding Interest Period;‎

	
 
	
(iii)‎
	
The last day for each Interest Period and the actual ‎number of days during the Interest Period shall be determined by ‎Lender using the practices of the London Interbank Market; ‎

	
 
	
(iv)‎
	
No Interest Period shall extend beyond the Maturity ‎Date, and any Interest Period which begins before the Maturity Date ‎and would otherwise end after the Maturity Date shall instead end on the Maturity ‎Date; and

	
 
	
(v)‎
	
At the end of each Interest Period a new Adjusted ‎LIBOR Rate will automatically go into effect for a new one-month LIBOR Rate ‎Interest Period unless Borrower elects differently in writing.‎

‎‎“LIBOR Rate” means for any Interest Period, the average rate ‎‎(rounded upwards to the nearest 1/16th) as shown by Reuters at which deposits in ‎U.S. dollars are offered by first class banks in the London Interbank Market at ‎approximately 11:00 a.m. (London time) on the day that is two (2) LIBOR Business ‎Days prior to the first day of such Interest Period with a maturity ‎approximately equal to such Interest Period and in an amount ‎approximately equal to the amount to which such Interest Period ‎relates, adjusted for reserves and taxes if required by future regulations.  If Reuters ‎no longer reports such rate or Lender determines in good faith that the rate so ‎reported no longer accurately reflects the rate available to Lender in the London ‎Interbank Market, Lender may select a replacement index.  If the rate as determined ‎above shall be less than zero for any Interest Period, the LIBOR Rate ‎shall be deemed to be zero for purposes of the Note and all of the Loan Documents ‎for such period.

“LIBOR Rate Principal” means any portion of the Principal Debt which bears interest at an applicable LIBOR Rate at the time in question.

“MBK Maturity Date” means April 30, 2021.

“Permitted Restricted Payments” means (a) distributions from Entities to Student Holdco or Senior Holdco and from Student ‎Holdco or Senior Holdco to SSSHTOP so long as (1) such distribution does not violate the ‎Property Loan Documents; and (2) such distributions, to the extent received by a Credit Party, ‎may not be used for any purpose other than repayment of the Loans to the extent required by this ‎Agreement; (b) any Restricted Payments from an Entity which is not a Credit Party to any Credit ‎Party or other Entity; (c) distributions required by Section 5.14; (d) distributions constituting ‎Transaction Costs permitted by Section 2.08(e); (e) Required REIT 

-5-

82001324v.7

 

Distributions, (f) payments or ‎prepayments of the obligations evidenced by the Strategic 1031 Properties III Notes to the ‎extent permitted hereby, (g) other distributions by a Credit Party to its members or other equity ‎holders not permitted by clauses (a) through (f) above (other than distributions to Investors, ‎which are addressed in clause (h) below) so long as no Default or ‎Event of Default has occurred and is continuing, (h) distributions to Investors (other than ‎Required REIT Distributions, which are addressed in clause (d) above), (i) distributions by SAM to the holders of its existing Series A and Series B Preferred Equity Interests; and (j) distributions declared and paid by SAM to the holders of its Equity Interests to pay any state or federal income tax liability of such holders of the Equity Interests on account of the ownership of such Equity Interests; provided, however, that, distributions described in clauses (h), (i) and (j) above shall only be permitted ‎so long as (1) no Event of Default has occurred and is continuing or (2) if an Event of Default ‎has occurred and is continuing, not more than one hundred twenty (120) days has passed since ‎the occurrence of such Event of Default (the “Permitted Distribution Period”); provided, ‎however, that if more than one Event of Default exists at any time, the Permitted Distribution ‎Period shall commence on the date the earliest of such Events of Default occurred, provided, however, that in no event shall any distributions on the preferred Equity Interests in SSSHTOP and/or SSSHT constitute Permitted Restricted Payments.‎

“Portland Maturity Date” means April 30, 2021.

“Reserve Percentage” means for any Interest Period, that percentage which is specified three (3) Business Days before the first day of such Interest Period by the Board of Governors of the Federal Reserve System (or any successor) or any other governmental or quasi-governmental authority with jurisdiction over Lender for determining the maximum reserve requirement (including, but not limited to, any marginal reserve requirement) for Lender with respect to liabilities constituting of or including (among other liabilities) Eurocurrency liabilities in an amount equal to that portion of the Loan affected by such Interest Period and with a maturity equal to such Interest Period.

(d)The definitions of “Portland Closing Date Net Worth” “Portland Extended Maturity Date”, “Portland Extension Fee”, “Portland Extension Request” and “Portland Initial Maturity Date” are hereby deleted in their entirety from the Original Agreement

(e)Section 2.07(a)(iv) of the Original Agreement is hereby amended by deleting clauses (B) and (C) in their entirety therefrom.

(f)Section 2.09 of the Credit Agreement is hereby amended as follows:

(i)By amending and restated clause (e) thereof in its entirety to read as follows:

	
 
	
(e)
	
[reserved].

(ii)By adding the following clause (g) thereof in its entirety to read as follows:

	
 
	
(g)
	
On the Fourth Amendment Date, Borrower shall pay to the Lender an extension fee equal to 0.50% of the outstanding principal balance of the Loans as of the Fourth Amendment Date (the “Fourth Amendment Extension Fee”).

(g)Section 2.11 is hereby amended and restated in its entirety to read as follows:

-6-

82001324v.7

 

SECTION 2.11LIBOR Rate Lending Unlawful; Inability to Determine Rate.

(a)If Lender shall determine (which determination shall, upon notice thereof to Borrower, be conclusive and binding on Borrower absent manifest error) that, after the Closing Date, (A) the introduction of or any change in or in the interpretation of any Law makes it unlawful or (B) any governmental authority with jurisdiction over Lender or any of its assets asserts that it is unlawful for Lender to make or continue the Loan as, or to convert (if permitted pursuant to the Note) the Loan into a LIBOR Loan, the obligations of such Lender to make, continue or convert into any such LIBOR Loan shall, upon such determination, be suspended until Lender shall determine that the circumstances causing such suspension no longer exist, and all outstanding LIBOR Loans shall automatically convert into Base Rate Loans at the end of the then current Interest Periods with respect thereto or sooner, if required by Law or such assertion.

(b)If Lender shall determine that for any reason adequate and reasonable means do not exist for determining the LIBOR Rate for any requested Interest Period with respect to a proposed LIBOR Loan, or that the LIBOR Rate for any requested Interest Period with respect to a proposed LIBOR Loan does not adequately and fairly reflect the cost to Lender of funding such LIBOR Loan, Lender will promptly so notify Borrower.  Thereafter, the obligation of Lender to make or maintain such LIBOR Loan shall be suspended until Lender revokes such notice.  Upon receipt of such notice, Borrower may, prior to the effectiveness of any requested borrowing, conversion or continuation, revoke any pending request for a borrowing of, conversion to or continuation of such LIBOR Loan or, failing that, will be deemed to have converted such request into a request for a borrowing of a Base Rate Loan in the amount specified therein.

(c)Benchmark Transition Event.

(i)Benchmark Replacement. Notwithstanding anything to the contrary herein or in any other Loan ‎Document, (i) upon the determination of Lender (which shall be conclusive absent ‎manifest error) that a Benchmark Transition Event has occurred or (ii) upon the occurrence of ‎an Early Opt-in Election, as applicable, Lender and Borrower may amend this Agreement, the Note and any other Loan Document to replace the LIBOR Rate with a Benchmark Replacement, by a written document executed by ‎Borrower and Lender, subject to the requirements of this Section 2.11. Notwithstanding anything else to the contrary herein or in any ‎other Loan Document, any such amendment with respect to a Benchmark Transition Event will ‎become effective and binding upon Borrower and Lender at 5:00 ‎p.m. on the fifth (5th) Business Day after Lender has delivered such proposed ‎amendment to Borrower. No replacement of LIBOR with a Benchmark Replacement ‎pursuant to this Section 2.11 will occur prior to the applicable ‎Benchmark Transition Start Date.  ‎

(ii)Benchmark Replacement Conforming Changes. In connection with the implementation of a ‎Benchmark Replacement, Lender will have the right to make Benchmark ‎Replacement Conforming Changes from time to time and, notwithstanding anything to the contrary ‎herein or in any other Loan Document, any amendments implementing such Benchmark Replacement ‎Conforming Changes will become effective without any further action or consent of any other party to ‎this Agreement.

(iii)Notices; Standards for Decisions and Determinations. Lender will promptly notify Borrower in writing of (i) any occurrence of a Benchmark Transition Event or an ‎Early Opt-in Election, as applicable, and its related Benchmark Replacement Date and Benchmark ‎Transition Start Date, (ii) the implementation of any Benchmark 

-7-

82001324v.7

 

Replacement, (iii) the effectiveness of ‎any Benchmark Replacement Conforming Changes and (iv) the commencement or conclusion of any ‎Benchmark Unavailability Period. Any determination, decision or election that may be made by Lender pursuant to this Section 2.11 including, without limitation, any determination with respect to a tenor, comparable replacement rate ‎or adjustment, or implementation of any Benchmark Replacement Rate Conforming Changes, or of ‎the occurrence or non-occurrence of an event, circumstance or date and any decision to take or ‎refrain from taking any action, will be conclusive and binding on all parties hereto absent manifest ‎error and may be made in its or their sole discretion and without consent from any other party hereto, ‎except, in each case, as expressly required pursuant to this Section 2.11 and shall not be a basis of any claim of liability of any kind or nature by any party ‎hereto, all such claims being hereby waived individually be each party hereto.

(iv)Benchmark Unavailability Period. Upon Borrower’s receipt of notice of the commencement of ‎a Benchmark Unavailability Period, Borrower may revoke any request for a LIBOR Loan, conversion to or continuation of LIBOR Loans to be made, converted or continued during any ‎Benchmark Unavailability Period and, failing that, Borrower will be deemed to have converted any ‎such request into a request for a Loan of or conversion to Base Rate Loans. During any Benchmark ‎Unavailability Period, the components of Base Rate based upon the LIBOR Rate will not be used in any determination ‎of the Base Rate. 

(h)Section 5.02(b) of the Original Agreement is hereby amended and restated in its entirety to read as follows:

	
(b)
	
SSSHT.  SSSHT shall at all times have and maintain, on a consolidated basis in accordance with ‎GAAP or other accounting principles consistently applied and reasonably acceptable to ‎Lender, tested as of the close of each fiscal quarter (i) commencing on September 30, 2020, ‎Net Worth (SSSHT) of at least the sum of (A) eighty-five percent (85%) of the Fourth Amendment  Date Net Worth plus (B) eighty-five percent (85%) of Equity Issuance Net Proceeds ‎received following the Fourth Amendment Date at all times thereafter; (ii) a Leverage Ratio of not greater than (A) seventy-five percent (75%) at all times from the Fourth Amendment Date through and including December 30, 2020 and (B) sixty-five percent (65%) at all times thereafter, and ‎‎(iii) a Fixed Charge ‎Coverage Ratio of not less than (A) 0.90 to 1.00 at all times from the Fourth Amendment Date through and including June 29, 2020; (B) 1.00 to 1.00 at all times from and including June 30, 2020 through and including December 30, 2020 and (C) 1.15 to 1.00 at all times thereafter‎.  Notwithstanding anything set forth herein or in the Original Credit Agreement to the contrary, SSSHT’s compliance with the financial covenants set forth in this clause (b) are hereby waived for the test period ending on December 31, 2019.

(i)Exhibit A-3 attached to the Original Credit Agreement is hereby replaced in its entirety with Exhibit A-3 attached hereto.

(j)Notwithstanding anything set forth in the Original Credit Agreement to the contrary, Lender shall have no further obligation to fund any Additional Loans or any Portland Delayed Draw Loans.

2.Conditions Precedent.  The effectiveness of this Amendment is subject to satisfaction of the following conditions precedent, as determined by Lender in its reasonable discretion:

-8-

82001324v.7

 

(a)Lender (or its counsel) shall have received from each Credit Party a counterpart of this Amendment and all other Loan Documents to which it is party signed on behalf of such party in connection with this Amendment.

(b)Lender shall have received such documents and certificates as Lender or its counsel may reasonably request relating to the organization, existence and good standing of the Credit Parties, the authorization of the transactions with respect to this Amendment and any other legal matters relating to the Credit Parties, this Amendment or the transactions with respect hereto, all in form and substance satisfactory to Lender and its counsel.

(c)Lender shall have received all fees and other amounts due and payable on or prior to the Fourth Amendment Date, including, the Fourth Amendment Extension Fee and, to the extent invoiced, reimbursement or payment of all out-of-pocket expenses required to be reimbursed or paid by Borrower hereunder.

(d)The Collateral shall not be subject to any Liens other than Permitted Liens.

(e)At the time of and immediately after giving effect to this Amendment, no Default or Event of Default shall have occurred and be continuing.

(f)No Material Adverse Effect shall have occurred since December 31, 2018.

(g)The representations and warranties of the Credit Parties and Entities as set forth in the Credit Agreement and each Loan Document shall be true and correct in all material respects as of the Fourth Amendment Date.

3.Representations and Warranties.  

(a)The representations and warranties set forth in the Original Agreement are true and correct as of the Fourth Amendment Date, except to the extent such representation or warranty relates to an earlier date, in which case, such representation or warranty is true and correct as of such earlier date.

(b)This Amendment (i) has been duly authorized, executed and delivered by Borrower and (ii) constitutes the legal, valid and binding obligation of Borrower enforceable in accordance with the terms hereof, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, receivership, fraudulent conveyance, moratorium or similar laws affecting creditors’ rights generally, and by general equitable principles (whether enforcement is sought by proceedings in equity or at law).

(c)Each Borrower (other than Individual Borrower) is a duly organized and validly existing entity in good standing under the laws of the state of its organization or formation, has all requisite power and authority to conduct its business and to own its property as now conducted or owned, and is qualified to do business in all jurisdictions where the nature and extent of its business is such that such qualification is required by law.

4.Severability.  Any provision of this Amendment which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or 

-9-

82001324v.7

 

unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

5.Paragraph Headings.  The paragraph headings used in this Amendment are for convenience of reference only and are not to affect the construction, or be taken into consideration in interpreting, this Amendment.

6.Governing Law; Venue.  The construction, interpretation, validity, enforceability and effect of all provisions of this Amendment including, but not limited to, the payment of the Obligations and the legality of the interest rate and other charges shall be construed and enforced in accordance with the internal laws of the Commonwealth of Massachusetts (without regard to conflicts of laws).  Borrower agrees to submit to non-exclusive personal jurisdiction in the Commonwealth of Massachusetts in any action or proceeding arising out of this Amendment and, in furtherance of such agreement, Borrower hereby agrees and consents that, without limiting other methods of obtaining jurisdiction, personal jurisdiction over Borrower in any such action or proceeding may be obtained within or without the jurisdiction of any court located in the Commonwealth of Massachusetts, and that any process or notice of motion or other application to any such court in connection with any such action or proceeding may be served upon Borrower by registered or certified mail to or by personal service at the last known address of Borrower, whether such address be within or without the jurisdiction of any such court.

7.WAIVER OF JURY TRIAL.  BORROWER AND LENDER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES THE RIGHT TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AMENDMENT OR ANY OTHER LOAN DOCUMENTS (AS DEFINED EITHER IN THE CREDIT AGREEMENT) CONTEMPLATED TO BE EXECUTED IN CONNECTION HEREWITH, OR ANY COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY.  THIS WAIVER CONSTITUTES A MATERIAL INDUCEMENT FOR THE LENDER TO ACCEPT THIS AMENDMENT.

8.Multiple Counterparts.  This Amendment may be executed in one or more counterparts, each of which shall be deemed an original.  Each of the counterparts shall constitute but one in the same instrument and shall be binding upon each of the parties individually as fully and completely as if all had signed but one instrument.

9.References in Loan Documents.  All references in any of the Loan Documents to the “Credit Agreement”, or to the “Loan Documents” shall, from and after the Fourth Amendment Date be deemed to mean and refer to the Original Agreement as amended and affected by this Amendment.  This Amendment shall be deemed to be a “Loan Document” for the purposes of the Credit Agreement and the other Loan Documents.

10.Ratification by Credit Parties.  Borrower hereby ratifies, affirms and confirms the Loan Documents (as modified by this Amendment), and acknowledges and agrees that the Loan Documents (as modified by this Amendment) remain in full force and effect and are enforceable against Borrower and against the Collateral described therein in accordance with their respective 

-10-

82001324v.7

 

terms.  Borrower hereby further acknowledges and agrees that, as of the Fourth Amendment Date, the Loan Documents, as amended by this Amendment, are not subject to any defenses, rights of setoff, claims or counterclaims that might limit the enforceability thereof, the obligations created and evidenced thereby or the terms and provisions thereof

11.No Waiver.  This Amendment is only a modification of the Original Agreement and is not intended to, and shall not be construed to, effect a novation of the Original Agreement, or to constitute a modification of, or a course of dealing at variance with, the Original Agreement (each as amended by this Amendment), such as to require further notice by Lender to require strict compliance with the terms of the Original Agreement in the future.

12.Release; Set-off.  Borrower hereby unconditionally releases and forever discharges Lender and its officers, directors, shareholders, employees, and attorneys from any and all claims, demands, causes of action, expenses, losses and other damages of whatever kind, whether known or unknown, liquidated or unliquidated, at law or in equity, that exists as of the Fourth Amendment Date in connection with the Credit Agreement, the Loan Documents, and any other documents relating thereto

13.Miscellaneous.

(a)All costs and expenses of Lender, including, without limitation, appraisal fees and reasonable attorney’s fees of counsel to Lender relating to the negotiation, preparation, execution and delivery of this Amendment and all instruments, agreements and documents contemplated hereby shall be the responsibility of Borrower.

(b)This Amendment may be executed in any number of counterparts, all of which when taken together shall constitute one agreement binding on the parties hereto, notwithstanding that all parties are not signatories to the same counterpart.

(c)Delivery of an executed signature page of this Amendment by facsimile transmission or by means of electronic mail (in so-called “pdf’, “TIF” or any similar format) shall be effective as an in-hand delivery of an original executed counterpart hereof.

 

[SIGNATURE PAGES FOLLOW]

 

-11-

82001324v.7

Exhibit 10.1

IN WITNESS WHEREOF, the undersigned has caused this Amendment to be duly executed and delivered as of the date first above written.

BORROWER:

 

SSSHT OPERATING PARTNERSHIP, L.P., a Delaware limited partnership 

 

	
 
	
by:
	
Strategic Student & Senior Housing Trust, Inc. a Maryland corporation

 

By: /s/ H. Michael Schwartz                

H. Michael Schwartz, Chief Executive Officer

 

 

/s/ H. Michael Schwartz                

H. Michael Schwartz

 

 

NOBLE PPS, LLC 

 

 

By: /s/ H. Michael Schwartz                 

H. Michael Schwartz, Manager

 

 

SMARTSTOP ASSET MANAGEMENT, LLC 

 

 

By: /s/ H. Michael Schwartz                 

H. Michael Schwartz, Manager

 

 

LENDER:

 

KEYBANK NATIONAL ASSOCIATION

 

 

By: /s/ Christopher T. Neil                      

Christopher T. Neil, Senior Banker

 

[Signature Page to Fourth Amendment]

82001324v.7

 

EXHIBIT A-3

SSSHT Compliance Certificate 

 

Date:___________________________

KeyBank National Association

225 Franklin Street, 16th Floor

Boston, Massachusetts 02110

Attn: Christopher T. Neil, Institutional Real Estate

 

Ladies and Gentlemen:

 

This Compliance Certificate is made with reference to that certain Second Amended and Restated Credit Agreement dated as of February 23, 2018 (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”), among SSSHT Operating Partnership, L.P., H. Michael Schwartz, Noble PPS, LLC and SmartStop Asset Management, LLC and KeyBank National Association and that certain Second Amended and Restated Guaranty Agreement dated as of February 23, 2018 (as amended, supplemented or otherwise modified from time to time, the “Guaranty”) made by Strategic Student & Senior Housing Trust, Inc. (“SSSHT”).  All capitalized terms used in this Compliance Certificate (including any attachments hereto) and not otherwise defined in this Compliance Certificate shall have the meaning set forth for such terms in the Credit Agreement.  All Section references herein shall refer to the Credit Agreement.  The undersigned (a) is a Financial Officer of SSSHT and (b) has reviewed the financial activities for SSSHT for the fiscal quarter ending ________, 20__ (the “Reporting Period”) with a view to determining whether SSSHT has kept and fulfilled its obligations under the Credit Agreement and Guaranty.  The undersigned hereby certifies as follows: 

1.Net Worth (SSSHT): [§5.02(b)(i) of the Credit Agreement]1$

		
	
Covenant:  Minimum Net Worth (SSSHT) not less than $  (85% of Fourth Amendment Date Net Worth (SSSHT) ($__________) plus 85% of Equity Issuance Net Proceeds since Fourth Amendment Date ($__________))

In compliance?  Yes/No
	
 

2.Leverage Ratio [§5.02(b)(ii) of the Credit Agreement]:

		
	
(a)Total Indebtedness (SSSHT)
	
$

	
(b)Total Assets (SSSHT)
	
$

	
Leverage Ratio ((a) divided by (b), expressed as a percentage)
	
____%

	
	 

	
1 
	
 Commencing as of September 30, 2020.

Exhibit A-3

 

82001324v.7

 

		
	
Covenant:  Maximum Leverage Ratio not greater than [75% / 65%]

In compliance?  Yes/No
	
 

3.Fixed Charge Coverage Ratio [§5.02(b)(iii) of the Credit Agreement]:

		
	
(a)EBITDA of SSSHT (calculated pursuant to Attachment 1)
	
$

	
(b)Principal and Interest due on SSSHT’s Indebtedness2
	
$

	
(c)Distributions paid with respect to any preferred Equity Interests
	
$

	
(d)Fixed Charge Ratio (3(a) ÷ (3(b) plus 3(c)):1.00
	
____:1.00

	
Covenant:  not less than [0.90 to 1.00 / 1.00 to 1.00 / 1.15 to 1.00]

In compliance?  Yes/No
	
 

 

 

STRATEGIC STUDENT & SENIOR HOUSING TRUST, INC., a Maryland corporation

 

 

By:________________________________

Name:__________________________

Title:___________________________

	
	 

	
2 
	
 Excluding principal due with respect to the Loans or due at maturity of any Indebtedness and including, without limitation, scheduled payments on Capital Lease Obligations and SSSHT’s Equity Percentage of the Property Level Debt but excluding any payments with respect to the Loans.

Exhibit A-3

 

82001324v.7

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00306-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00306-of-00352.parquet"}]]