Document:

Exhibit 4.11

 

	RIGHTS CERTIFICATE #:	NUMBER OF RIGHTS:

 

THE TERMS AND CONDITIONS OF THE RIGHTS
OFFERING ARE SET FORTH IN THE COMPANY’S PROSPECTUS DATED FEBRUARY 7, 2014 (THE “PROSPECTUS”) AND ARE INCORPORATED
HEREIN BY REFERENCE. COPIES OF THE PROSPECTUS ARE AVAILABLE UPON REQUEST FROM CONTINENTAL STOCK TRANSFER & TRUST COMPANY, THE
SUBSCRIPTION AGENT.

 

NEPHROS, INC.

 

(Incorporated under the laws of the State
of Delaware)

 

NONTRANSFERABLE SUBSCRIPTION RIGHTS
CERTIFICATE

 

Evidencing Nontransferable Subscription Rights to Purchase Shares
of Common Stock of Nephros, Inc.

Subscription Price: $0.30 per Share

THE SUBSCRIPTION RIGHTS WILL EXPIRE IF NOT EXERCISED ON OR BEFORE
5:00 P.M., EASTERN TIME, ON MARCH 10, 2014, UNLESS EXTENDED BY THE COMPANY. THIS CERTIFIES THAT

 

the registered owner whose name is
inscribed hereon is the owner of the number of subscription rights (“Rights”) set forth on the face of this
certificate. Each whole Right entitles the holder thereof to subscribe for and purchase 0.28673 of a share of common stock
(“Share”), par value of $0.001 per Share, of Nephros, Inc., a Delaware corporation (the “Company”),
at a subscription price of $0.30 per Share (the “Subscription Privilege”), pursuant to a rights offering (the
“Rights Offering”), on the terms and subject to the conditions set forth in the Prospectus and the
“Instructions for Use of Nephros, Inc. Subscription Rights Certificates” accompanying this Subscription Rights
Certificate. The Rights expire at 5:00 p.m. on March 10, 2014, unless extended. If the Company extends the time for
exercising the Rights, it will not extend such time more than 60 days past the date of the Prospectus. The Rights represented
by this Subscription Rights Certificate may be exercised by completing the “Form of Election to Purchase” on the
reverse side hereof and by returning the full payment of the subscription price for each Share in accordance with the
“Instructions for Use of Nephros, Inc. Subscription Rights Certificates” that accompanies this Subscription
Rights Certificate.

 

This Subscription Rights Certificate is not valid unless countersigned
by the transfer agent and registered by the registrar.

 

	WITNESS the facsimile signatures of a duly authorized officer of Nephros, Inc.	 	NEPHROS, INC. COUNTERSIGNED AND REGISTERED
	 	 	 	 
	 	 	 	By:	 
	 	 	 	  John C. Houghton 
	 	 	 	  President, Chief Executive Officer and
	 	 	 	  Acting Chief Financial Officer

 

	CONTINENTAL STOCK TRANSFER & TRUST COMPANY	 
	 	 	 
	By:	 	 

 

    	 

    	 

    

 

FORM OF ELECTION
TO PURCHASE

 

PLEASE PRINT ALL INFORMATION CLEARLY
AND LEGIBLY

 

The registered holder of this Rights Certificate
is entitled to exercise the number of Rights shown in the upper right hand corner of the Subscription Rights Certificate and may
subscribe for additional Shares upon the terms and conditions specified in the Prospectus. The undersigned hereby notifies the
Subscription Agent of its irrevocable election to subscribe for Shares in the following amounts: To subscribe for Shares pursuant
to your Subscription Privilege, please complete lines (a) and (b) and sign below.

 

		(a)	EXERCISE OF SUBSCRIPTION PRIVILEGE:

 

	 	 	NUMBER
    OF SHARES OF 

    COMMON STOCK OWNED 

    AS OF THE RECORD DATE	 	SUBSCRIPTION

    RATIO	 	SUBSCRIPTION

    PRICE	 	PAYMENT
	 	 	 	 	 	 	 	 	 
	Subscription Privilege:		                                           
      X                      	 	     0.28673   
       X    	 	      $
    0.30          =	 	$                    

 

	 	 	NUMBER
    OF SHARES OF COMMON 

    STOCK UNDERLYING A WARRANT 

    OWNED AS OF THE RECORD DATE	 	SUBSCRIPTION

    RATIO	 	SUBSCRIPTION

    PRICE	 	PAYMENT
	 	 	 	 	 	 	 	 	 
	Plus the Product of:		                                           
      X                     		     0.28673   
        X   	 	      $
    0.30        =	 	$                    

 

		(b)	Total Amount of Payment Enclosed $                                                        

 

		(c)	METHOD OF PAYMENT (CHECK ONE):

 

		 ̈	Check or bank draft payable to “Continental Stock Transfer &
Trust Company (acting as subscription agent for Nephros, Inc.)”, drawn on a U.S. bank.

 

		 ̈	U.S. Postal money order payable to “Continental Stock Transfer
& Trust Company (acting as subscription agent for Nephros, Inc.)”.

 

		 ̈	Wire transfer of immediately available funds directly to the account
maintained by Continental Stock Transfer & Trust Company as agent for Nephros, Inc., for purposes of accepting subscriptions
in the Rights Offering, at JPMorgan Chase; ABA # 021-000021; Account # 475-508351 FBO Nephros, Inc. Subscription, with reference
to the rights holder’s name.

 

		(d)	The undersigned acknowledges receipt of the Prospectus, dated February 7, 2014, in connection with the Rights Offering
and agrees to its terms.

 

	 	By:Exhibit 4.12

 

SUBSCRIPTION
AGENT AGREEMENT

 

THIS SUBSCRIPTION AGENT
AGREEMENT (“Agreement”) between Nephros, Inc., a Delaware corporation (the “Company”), and
Continental Stock Transfer & Trust Company, a New York corporation (“Continental”), is dated as of February
7, 2014.

 

1.            Appointment.

 

(a)          The
Company is distributing at no charge (the “Rights Offering”) to its stockholders and warrantholders
of record (each, a “Record Holder” and collectively, the “Record Holders”) at the close
of business on January 30, 2014 (the “Record Date”), non-transferable subscription rights
(the “Rights”) to purchase up to an aggregate of 9,166,667 shares of the Company’s common stock,
par value $0.001 per share (the “Common Stock”). Each Record Holder will receive one Right for each share
of Common Stock owned and/or each share of Common Stock underlying the warrants owned. Each Right entitles the Record Holder
to purchase 0.28673 of a share of Common Stock at a purchase price of $0.30 per share (the “Subscription
Price”). The Company will not issue any fractional shares of Common Stock and will round up any fractional shares
of Common Stock to the nearest whole share. The term “Subscribed” shall mean submitted for purchase from
the Company by a Record Holder in accordance with the terms of the Rights Offering, and the term
“Subscription” shall mean any such submission.

 

(b)          The
Rights Offering will expire on March 10, 2014 at 5:00 p.m. Eastern Time (the “Expiration Time”), unless the
Company shall have extended the period of time for which the Rights Offering is open, in its sole discretion for up to 60 days
from the date of the Prospectus (as defined below), in which event the term “Expiration Time” shall mean the latest
time and date at which the Rights Offering, as so extended by the Company from time to time, shall expire.

 

(c)          The
Company filed a Registration Statement on Form S-1 (File No. 333-193215) relating to the rights offering on January 7, 2014, as
amended by a Registration Statement on Form S-1/A filed on February 3, 2014, with the Securities and Exchange Commission (the
“SEC”) under the Securities Act of 1933, as amended (the “Registration Statement”). The
terms of the Rights Offering are more fully described in the Prospectus (the “Prospectus”) forming part of
the Registration Statement as such Registration Statement may be declared effective by the SEC. A copy of the Prospectus is attached
hereto as Exhibit 1. All terms used and not defined herein shall have the same meaning as in the Prospectus. Promptly
after the Record Date, Continental, in its capacity as transfer agent, will generate a list of holders of Record Holders as of
the Record Date (the “Record Holders List”).

 

(d)          The
Company hereby appoints Continental to act as subscription agent (the “Subscription Agent”) for the Rights Offering
in accordance with and subject to the following terms and conditions.

 

2.            Subscription
of Rights. The Rights are evidenced by subscription rights certificates (the “Certificates”), a
copy of the form of which is attached hereto as Exhibit 2. The Certificates entitle the Record Holders to
Subscribe, upon payment of the Subscription Price, for shares of Common Stock at the rate of 0.28673 of a share per Right
evidenced by a Certificate (the “Subscription Privilege”). No fractional shares will be issued and any
fractional shares will be rounded up to the nearest whole share.

 

3.            Duties of
Subscription Agent. As Subscription Agent, Continental is authorized and directed to perform the following:

 

(a)          Issue
the Certificates in accordance with this Agreement in the names of the Record Holders or other nominees on the Record Date, keep
such records as are necessary for the purpose of recording such issuance, and furnish a copy of such records to the Company. The
Certificates may be signed on behalf of the Subscription Agent by the manual or facsimile signature of a Vice President or Assistant
Vice President of the Subscription Agent, or by the manual signature of any of its other authorized officers.

 

    	 

    	 

    

 

(b)          Promptly
after Continental generates the Record Holders List, Continental shall:

 

(i)            mail
or cause to be mailed, by first class mail, or deliver (which delivery may be done electronically through the facilities of the
Depository Trust Company (“DTC”) or otherwise) to each Record Holder as of the Record Date whose address of
record is within the United States and Canada, (i) a Certificate evidencing the Rights to which such Record Holder is entitled
under the Rights Offering, (ii) a copy of the Prospectus, and (iii) a return envelope addressed to the Subscription Agent;

 

(ii)           mail
or cause to be mailed, by first class mail, or deliver through Broadridge Financial Solutions, Inc., or other intermediary firms,
a Prospectus and other ancillary documents to be distributed to beneficial holders of the Common Stock and/or the warrants; and

 

(iii)          mail
or cause to be mailed, to each Record Holder as of the Record Date whose address of record is outside the United States and Canada,
or is an A.P.O. or F.P.O. address, a copy of the Prospectus. Continental shall refrain from mailing Certificates issuable to any
Record Holder as of the Record Date whose address of record is outside the United States and Canada, or is an A.P.O. or F.P.O.
address, and hold such Certificates for the account of such Record Holder subject to such Record Holder making satisfactory arrangements
with the Subscription Agent for the exercise of the Rights evidenced thereby, and follow the instructions of such Record Holder
for the exercise of such Rights if such instructions are received at or before 11:00 a.m., Eastern Time, at least three business
days prior to the Expiration Time.

 

(c)          Mail
or deliver (which delivery may be done electronically through the facilities of DTC or otherwise) a copy of the Prospectus with
certificates for shares of Common Stock when such are issued to persons other than the registered holder of the Certificate.

 

(d)          Accept
Subscriptions upon the due exercise (including payment of the Subscription Price) on or prior to the Expiration Time of Rights
in accordance with the terms of the Certificates and the Prospectus.

 

(e)          Subject
to the next sentence, accept Subscriptions from Record Holders whose Certificates are alleged to have been lost, stolen, or destroyed
upon receipt by Continental of an affidavit of theft, loss, or destruction and a bond of indemnity in form and substance reasonably
satisfactory to Continental, accompanied by payment of the Subscription Price for the total number of Rights Subscribed. Upon receipt
of such affidavit and bond of indemnity and compliance with any other applicable requirements, stop orders shall be placed on said
Certificates and Continental shall withhold delivery of the Rights Subscribed for until after the Certificates have expired and
it has been determined that the Rights evidenced by the Certificates have not otherwise been purported to have been exercised or
otherwise surrendered.

 

(f)          Accept
Subscriptions, without further authorization or direction from the Company, without procuring supporting legal papers or other
proof of authority to sign (including without limitation proof of appointment of a fiduciary or other person acting in a representative
capacity), and without signatures of co-fiduciaries, co-representatives, or any other person:

 

(i)            if the
Certificate is registered in the name of a fiduciary and is executed by, and the Rights are to be issued in the name of, such fiduciary;

 

(ii)           if
the Certificate is registered in the name of joint tenants and is executed by one of the joint tenants, provided the certificate
representing the Rights is issued in the names of, and is to be delivered to, such joint tenants;

 

    	2

    	 

    

 

(iii)          if
the Certificate is registered in the name of a corporation and is executed by a person in a manner which appears or purports to
be done in the capacity of an officer, or agent thereof, provided the Rights are to be issued in the name of such corporation;
or

 

(iv)          if
the Certificate is registered in the name of an individual and is executed by a person purporting to act as such individual’s
executor, administrator, or personal representative, provided, the Rights are to be registered in the name of the subscriber as
executor or administrator of the estate of the deceased registered holder and there is no evidence indicating the subscriber is
not the duly authorized representative that he purports to be.

 

(g)          Accept
Subscriptions not accompanied by Certificates if submitted by a firm having membership in the New York Stock Exchange or another
national securities exchange or by a commercial bank or trust company having an office in the United States and accompanied by
proper payment for the total number of Rights Subscribed.

 

(h)          Refer
to the Company for specific instructions as to acceptance or rejection, Subscriptions received after the Expiration Time, Subscriptions
not authorized to be accepted, and Subscriptions otherwise failing to comply with the requirements of the Prospectus and the terms
and conditions of the Certificates.

 

4.            Acceptance
of Subscriptions. Upon acceptance of a Subscription, Continental shall from time to time during the offering:

 

(a)          Hold
all monies received in a dedicated, non-interest bearing account for the benefit of the Company. Promptly following the Expiration
Time, Continental shall, upon the receipt of the Distribution Letter in the form attached hereto as Exhibit 3 and executed
by the Company, distribute to the Company the funds from exercise of the Subscription Privileges in such account and following
the Expiration Date issue (in physical form or electronically through the facilities of DTC, in each case in a manner approved
by the Company) certificates for shares of Common Stock issuable with respect to Subscriptions that have been accepted. Continental
will not be obligated to calculate or pay interest to any holder or any other party claiming through a holder or otherwise. It
is hereby agreed immediately following the effective date of the Subscription, immediately available funds, represented by certified
check, money order, or wire transfer but not personal check, will be deposited with Continental. In the event that the Rights Offering
is not consummated because the Company has withdrawn, cancelled or terminated the Rights Offering, Continental shall, upon the
receipt of the Liquidation Letter in the form attached hereto as Exhibit 4 and executed by the Company, liquidate the
segregated account in which the Subscription monies were held as promptly as practicable and distribute the funds to each respective
Subscribing Record Holder who elected to exercise its Rights;

 

(b)          Advise
the Company daily by facsimile transmission and confirm by letter to the attention of John C. Houghton, President, Chief Executive
Officer and Acting Chief Financial Officer of the Company (the “Company Representative”) as to the total number
of shares of Common Stock Subscribed for and the amount of funds received, with cumulative totals for each; and in addition advise
the Company Representative, by telephone at (201) 343-5202, ext. 101, confirmed by facsimile transmission at (201) 343-5207, of
the amount of funds received identified in accordance with (a) above, deposited, available, or transferred in accordance with (a)
above from each Subscribing Record Holder, with cumulative totals; and

 

(c)          As
promptly as possible but in any event on or before 3:30 p.m., Eastern Time, on the first full business day following the Expiration
Time, deliver to the Company Representative a report in accordance with (b) above of the number of shares Subscribed and the number
of shares of Common Stock unsubscribed; provided, however, that a final report will be delivered to the Company as promptly as
possible following the Expiration Time.

 

    	3

    	 

    

 

5.            Completion
of Rights Offering. Upon completion of the Rights Offering:

 

(a)          Continental
shall issue (in physical form or electronically through the facilities of DTC, in each case in a manner approved by the Company)
certificates for the Common Stock for which Subscriptions have been received.

 

(b)          The
Certificates may be physical certificates but may, as instructed by the Company be issued electronically through the facilities
of DTC. Continental, in its capacity as transfer agent, shall keep books and records of the registration and transfers and exchanges
of Certificates (such books and records are hereinafter called the “Certificate Register”). The Company shall
promptly notify Continental of the exercise of any Certificates.

 

(c)          All
Certificates issued upon any registration of transfer or exchange of Certificates shall be the valid obligations of the Company,
evidencing the same obligations, and entitled to the same benefits under this Agreement, as the Certificates surrendered for such
registration of transfer or exchange.

 

(d)          For
so long as this Agreement shall be in effect, the Company will reserve for issuance and keep available free from preemptive rights
a sufficient number of shares of Common Stock to permit the exercise in full of all Rights issued pursuant to the Rights Offering.
Subject to the terms and conditions of this Agreement, Continental will issue (in physical form or electronically through the facilities
of DTC, in each case in a manner approved by the Company) certificates evidencing the appropriate number of shares of Common Stock
as required from time to time in order to effectuate the Subscriptions.

 

(e)          The
Company shall take any and all action, including without limitation obtaining the authorization, consent, lack of objection, registration,
or approval of any governmental authority, or the taking of any other action under the laws of the United States of America or
any political subdivision thereof, to insure that all shares of Common Stock issuable upon the exercise of the Certificates at
the time of delivery of the certificates therefor (subject to payment of the Subscription Price) will be duly and validly issued
and fully paid and non-assessable shares of Common Stock, free from all preemptive rights and taxes, liens, charges, and security
interests created by or imposed upon the Company with respect thereto.

 

(f)          The
Company shall from time to time take all action necessary or appropriate to obtain and keep effective all registrations, permits,
consents, and approvals of the SEC and any other governmental agency or authority and make such filings under federal and state
laws which may be necessary or appropriate in connection with the issuance and delivery of Certificates or the issuance, sale,
transfer, and delivery of Common Stock issued upon exercise of Certificates.

 

6.            Procedure
for Discrepancies. Continental shall follow its regular procedures to attempt to reconcile any discrepancies between the number
of shares of Common Stock that any Certificate may indicate are to be issued to a Record Holder and the number that the Record
Holders List indicates may be issued to such Record Holder. In any instance where Continental cannot reconcile such discrepancies
by following such procedures, Continental will consult with the Company for instructions as to the number of shares of Common Stock,
if any, it is authorized to issue. In the absence of such instructions, Continental is authorized not to issue any shares of Common
Stock to such Record Holder.

 

7.            Procedure
for Deficient Items. Continental shall examine the Certificates received by it as Subscription Agent to ascertain whether they
appear to have been properly completed and executed. In the event Continental determines that any Certificate does not appear to
have been properly completed or executed, or where the Certificates do not appear to be in proper form for Subscription, or any
other irregularity in connection with the Subscription appears to exist, Continental shall follow, where possible, its regular
procedures to attempt to cause such irregularity to be corrected. Continental is not authorized to waive any irregularity in connection
with the Subscription, unless Continental shall have received from the Company the Certificate which was delivered, duly dated
and signed by an authorized officer of the Company, indicating that any irregularity in such Certificate has been cured or waived
and that such Certificate has been accepted by the Company. If any such irregularity is neither corrected nor waived, Continental
will return to the Subscribing Record Holder (at its option by either first class mail under a blanket surety bond or insurance
protecting Continental and the Company from losses or liabilities arising out of the non-receipt or nondelivery of Certificates
or by registered mail insured separately for the value of such Certificates) to such Record Holder’s address as set forth
in the Subscription any Certificates surrendered in connection therewith and any other documents received with such Certificates,
and a letter of notice to be furnished by the Company explaining the reasons for the return of the Certificates and other documents.

 

    	4

    	 

    

 

8.            Date/Time
Stamp. Each document received by Continental relating to its duties hereunder shall be dated and time stamped when received.

 

9.            Tax Reporting.
Should any issue arise regarding federal income tax reporting or withholding, Continental shall take such action as the Company
reasonably instructs in writing.

 

10.          Termination.
The Company may terminate this Agreement at any time by so notifying Continental in writing. Continental may terminate this Agreement
upon 60 days’ prior written notice to the Company. Upon any such termination, Continental shall be relieved and discharged
of any further responsibilities with respect to its duties hereunder. Upon payment of all Continental’s outstanding fees
and expenses, Continental shall forward to the Company or its designee promptly any Certificate or other document relating to Continental’s
duties hereunder that Continental may receive after its appointment has so terminated. Sections 11, 12, 13, and 18 of this Agreement
shall survive any termination of this Agreement.

 

11.          Authorizations
and Protections. As agent for the Company, Continental:

 

(a)          shall
have no duties or obligations other than those specifically set forth herein or as may subsequently be agreed to in writing by
Continental and the Company;

 

(b)          shall
have no obligation to issue any shares of Common Stock unless the Company shall have provided a sufficient number of certificates
for such Common Stock;

 

(c)          shall
be regarded as making no representations and having no responsibilities as to the validity, sufficiency, value, or genuineness
of any Certificates surrendered to Continental hereunder or shares of Common Stock issued in exchange therefor, and will not be
required to or be responsible for and will make no representations as to, the validity, sufficiency, value or genuineness of the
Rights Offering;

 

(d)          shall
not be obligated to take any legal action hereunder; if, however, Continental determines to take any legal action hereunder, and
where the taking of such action might, in Continental’s judgment, subject or expose it to any expense or liability, Continental
shall not be required to act unless it shall have been furnished with an indemnity reasonably satisfactory to it;

 

(e)          may
rely on and shall be fully authorized and protected in acting or failing to act upon any certificate, instrument, opinion, notice,
letter, telegram, telex, facsimile transmission, or other document or security delivered to Continental and believed by it to be
genuine and to have been signed by the proper party or parties;

 

(f)           shall
not be liable or responsible for any recital or statement contained in the Prospectus or any other documents relating thereto;

 

(g)          shall
not be liable or responsible for any failure on the part of the Company to comply with any of its covenants and obligations relating
to the Rights Offering, including without limitation obligations under applicable securities laws;

 

(h)          may
rely on and shall be fully authorized and protected in acting or failing to act upon the written, telephonic, or oral instructions
of officers of the Company with respect to any matter relating to Continental acting as Subscription Agent covered by this Agreement
(or supplementing or qualifying any such actions);

 

(i)           may
consult with counsel satisfactory to Continental, including internal counsel, and the advice of such counsel shall be full and
complete authorization and protection in respect of any action taken, suffered, or omitted by Continental hereunder in good faith
and in reliance upon the advice of such counsel; and

 

    	5

    	 

    

 

(j)           is
not authorized, and shall have no obligation, to pay any brokers, dealers, or soliciting fees to any person.

 

12.          Indemnification.

 

(a)          The
Company agrees to indemnify Continental for, and hold it harmless from and against, any loss, liability, claim, or expense (“Loss”)
arising out of or in connection with Continental’s performance of its duties under this Agreement or this appointment, including
the costs and expenses of defending itself against any Loss or enforcing this Agreement, except to the extent that such Loss shall
have been determined by a court of competent jurisdiction to be a result of Continental’s negligence or intentional misconduct.

 

(b)          Continental
agrees to indemnify the Company for, and hold it harmless from and against, any Loss arising out of or in connection with: (i)
Continental’s failure to comply with the terms of this Agreement; and/or (ii) Continental’s negligence or willful misconduct.

 

(c)          Upon
the assertion of a claim for which one party may be required to indemnify the other, the party seeking indemnification shall promptly
notify the other party of such assertion, and shall keep the other party advised with respect to all developments concerning such
claim. The indemnifying party shall have the option to participate with the indemnified party in the defense of such claim or to
defend against said claim in its own name or the name of the indemnified party. The indemnified party shall in no case confess
any claim or make any compromise in any case in which the indemnifying party may be required to indemnify it except with the indemnifying
party’s prior written consent.

 

13.          Limitation
of Liability.

 

(a)          In
the absence of negligence or intentional misconduct on its part, Continental shall not be liable for any action taken, suffered,
or omitted by it or for any error of judgment made by it in the performance of its duties under this Agreement. Anything in this
Agreement to the contrary notwithstanding, in no event shall Continental be liable for special, indirect, incidental, or consequential
loss or damage of any kind whatsoever (including but not limited to lost profits), even if Continental has been advised of the
likelihood of such damages and regardless of the form of action. Notwithstanding anything to contrary herein, any liability of
Continental with respect to, arising from, or arising in connection with this Agreement, or from all services provided or omitted
to be provided under this Agreement, whether in contract, or in tort, or otherwise, is limited to two times the amount of fees
paid by the Company hereunder. Notwithstanding anything to the contrary herein, any liability of the Company with respect to, arising
from, or arising in connection with this Agreement will be limited to two times the amount of fees paid by the Company hereunder.

 

(b)          In
the event any question or dispute arises with respect to the proper interpretation of this Agreement or Continental’s duties
hereunder or the rights of the Company or of any Record Holders surrendering certificates for shares of Common Stock pursuant to
the Rights Offering, Continental shall not be required to act and shall not be held liable or responsible for refusing to act until
the question or dispute has been judicially settled (and Continental may, if it deems it advisable, but shall not be obligated
to, file a suit in interpleader or for a declaratory judgment for such purpose) by final judgment rendered by a court of competent
jurisdiction, binding on all Record Holders and parties interested in the matter which is no longer subject to review or appeal,
or settled by a written document in form and substance satisfactory to Continental and executed by the Company and each such Record
Holder and party. In addition, Continental may require for such purpose, but shall not be obligated to require, the execution of
such written settlement by all the Record Holders and all other parties that may have an interest in the settlement.

 

    	6

    	 

    

 

14.           Representations,
Warranties and Covenants. The Company represents, warrants, and covenants that (a) it is duly incorporated, validly existing,
and in good standing under the laws of its jurisdiction of incorporation, (b) the making and consummation of the Rights Offering
and the execution, delivery, and performance of all transactions contemplated thereby (including without limitation this Agreement)
have been duly authorized by all necessary corporate action and will not result in a breach of or constitute a default under the
certificate of incorporation or bylaws of the Company or any indenture, agreement, or instrument to which either is a party or
is bound, (c) this Agreement has been duly executed and delivered by the Company and constitutes a legal, valid, binding obligation
of the Company, enforceable against the Company in accordance with its terms, (d) the Rights Offering will comply in all material
respects with all material applicable requirements of law, and (e) to the best of its knowledge, there is no litigation pending
as of the date hereof in connection with the Rights Offering.

 

15.            Notices.
All notices, demands, and other communications given pursuant to the terms and provisions hereof shall be in writing, shall (except
as provided for in Section 17 hereof) be deemed effective on the date of receipt, and may be sent by facsimile, overnight delivery
services, or by certified or registered mail, return receipt requested to:

 

	If to the Company:
	
        Nephros, Inc.

        41 Grand Avenue

        River Edge, New Jersey 07661

        Telephone: (201) 343-5202

        Facsimile: (201) 343-5207

        Attn: John C. Houghton, President, Chief Executive
        Officer and Acting Chief Financial Officer

	 
	with a copy to:
	
        Day Pitney LLP

        One Jefferson Road

        Parsippany, NJ 07054

        Telephone: (973) 966-8123

        Facsimile: (973) 206-6791

        Attn: Michael T. Rave, Esq.

	 
	If to Continental:
	Continental Stock Transfer & Trust Company

17 Battery Place, 8th Floor

New York, NY 10004

Telephone:  (212) 845-3287

Facsimile:  (212) 616-7616

Attn:  Compliance Department

 

16.          Specimen
Signatures. Set forth in Exhibit 5 hereto is a list of the names and specimen signatures of the persons authorized
to act for the Company under this Agreement. The Company Representative shall, from time to time, certify to Continental the names
and signatures of any other persons authorized to act for the Company, as the case may be, under this Agreement.

 

17.          Instructions.
Any instructions given to Continental orally, as permitted by any provision of this Agreement, shall, upon the request of Continental,
be confirmed in writing by the Company (which for these purposes only may be undertaken by e-mail transmission) as soon as practicable.
Continental shall not be liable or responsible and shall be fully authorized and protected for acting, or failing to act, in accordance
with any oral instructions which do not conform with the written confirmation received in accordance with this Section.

 

18.          Fees.
Whether or not any Certificates are surrendered to Continental, for its services as Subscription Agent and transfer agent hereunder,
the Company shall pay to Continental a fee of Eleven Thousand Five Hundred Dollars ($11,500), together with reimbursement for reasonable
out-of-pocket expenses. All amounts owed to Continental hereunder are due upon receipt of the invoice.

 

    	7

    	 

    

 

19.          Force Majeure.
Continental shall not be liable for any failure or delay arising out of conditions beyond its reasonable control including, but
not limited to, work stoppages, fires, civil disobedience, riots, rebellions, storms, electrical, mechanical, computer or communications
facilities failures, acts of God or similar occurrences.

 

20.          Miscellaneous.

 

(a)          This
Agreement shall be governed by and construed in accordance with the laws of the State of New York without giving effect to conflict
of laws, rules, or principles.

 

(b)          No
provision of this Agreement may be amended, modified, or waived, except in writing signed by all of the parties hereto.

 

(c)          Except
as expressly set forth elsewhere in this Agreement, all notices, instructions, and communications under this Agreement shall be
in writing, shall be effective upon receipt and shall be addressed as provided in Section 15 to such other address as a party hereto
shall notify the other parties in writing.

 

(d)          In
the event that any claim of inconsistency between this Agreement and the terms of the Rights Offering arise, as they may from time
to time be amended, the terms of the Rights Offering shall control, except with respect to Continental’s duties, liabilities,
and rights, including without limitation compensation and indemnification, which shall be controlled by the terms of this Agreement.

 

(e)          If
any provision of this Agreement shall be held illegal, invalid, or unenforceable by any court, this Agreement shall be construed
and enforced as if such provision had not been contained herein and shall be deemed an Agreement among the parties hereto to the
full extent permitted by applicable law.

 

(f)           This
Agreement shall be binding upon, inure to the benefit of, and be enforceable by, the respective successors and assigns of the parties
hereto.

 

(g)          This
Agreement may not be assigned by any party without the prior written consent of all parties.

 

(h)          This
Agreement may be executed in counterparts, each of which, when taken together, shall constitute one and the same agreement, and
each of which may be delivered by the parties by facsimile or other electronic transmission, which shall not impair the validity
of such counterparts.

 

(Signature page follows)

 

    	8

    	 

    

 

Signature Page

to

Subscription Agent Agreement

 

IN WITNESS WHEREOF,
the parties hereto have executed this Agreement by their duly authorized officers as of the day and year above written.

 

	 	By:	 
	 	Name:	John C. Houghton
	 	Title:	President, Chief Executive Officer and
	 	 	Acting Chief Financial Officer
	 	 
	 	CONTINENTAL STOCK TRANSFER & TRUST COMPANY, as Subscription Agent and transfer agent
	 	 
	 	By:	 
	 	Name:
	 	Title:

 

	Exhibit 1	Prospectus
	Exhibit 2	Form of Subscription Rights Certificate 
	Exhibit 3	Distribution Letter
	Exhibit 4	Liquidation Letter
	Exhibit 5	List of Authorized Representatives

 

    	9

    	 

    

 

Exhibit 1

to

Subscription Agent Agreement

 

Prospectus

 

    	 

    	 

    

 

Exhibit 2

to

Subscription Agent Agreement

 

Form of Subscription Rights Certificate

 

    	 

    	 

    

 

Exhibit 3

to

Subscription Agent Agreement

 

Form of Distribution Letter

 

[Letterhead of Company]

 

[Insert date]

 

Continental Stock Transfer & Trust
Company

17 Battery Place

New York, New York 10004

Attn: [                     ]

Re: Trust Account No. [    ]
Termination Letter

 

Ladies and Gentlemen:

 

Pursuant to Section
4(a) of the Subscription Agent Agreement between Nephros, Inc., a Delaware corporation (“Company”) and Continental
Stock Transfer & Trust Company (“Subscription Agent”), dated as of February 7, 2014 (“Subscription Agent
Agreement”), you are hereby directed and authorized to transfer the subscription funds held in the segregated account immediately
in accordance with the terms of the Subscription Agent Agreement.

 

	 	Very truly yours,
	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:

 

    	 

    	 

    

 

Exhibit 4

to

Subscription Agent Agreement

 

Form of Liquidation Letter

 

[Letterhead of Company]

 

[Insert date]

 

Continental Stock Transfer & Trust
Company

17 Battery Place

New York, New York 10004

Attn: [            ]

 

Re: Trust Account No. [ ] Termination Letter

 

Ladies and Gentlemen:

 

Pursuant to Section
4(a) of the Subscription Agent Agreement between Nephros, Inc., a Delaware corporation (“Company”) and Continental
Stock Transfer & Trust Company (“Subscription Agent”), dated as of February 7, 2014 (“Subscription Agent
Agreement”), this is to advise you that the Company has withdrawn or otherwise terminated its Rights Offering (as defined
in the Subscription Agent Agreement).

 

In accordance with
the terms of the Subscription Agent Agreement, we hereby authorize you to commence liquidation of the segregated account in which
the Subscription monies were held as promptly as practicable to Record Holders who elected to exercise their Rights. You shall
commence distribution of such funds in accordance with the terms of the segregated account and you shall oversee the distribution
of such funds. Upon the payment of all the funds in the segregated account, your obligations under the Subscription Agent Agreement
shall be terminated.

 

	 	Very truly yours,
	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:

 

    	 

    	 

    

 

Exhibit 5

to

Subscription Agent Agreement

 

List of Authorized Representatives

 

 

	
        Authorized

        Representative
	
	
        Specimen
        Signature

	 	 	 
	 	 	 
	John C. Houghton	 	 
	President, Chief Executive Officer	 	 
	and Acting Chief Financial Officer

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00225-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00225-of-00352.parquet"}]]