Document:

ex_220589.htm

Exhibit 10.3

 

First Amendment of

MEZZANINE b LOAN Forbearance Agreement

 

 

 

This First Amendment of Mezzanine B Loan Forbearance Agreement (this “Amendment”) is made effective as of January 7, 2021 (the “Effective Date”), by and among HIT PORTFOLIO I MEZZ B, LLC (“Borrower”), and HIT PORTFOLIO I TRS MEZZ B, LLC and HIT 2PK TRS MEZZ B, LLC (collectively, “Leasehold Pledgor”) and HOSPITALITY INVESTORS TRUST OPERATING PARTNERSHIP, L.P. and HOSPITALITY INVESTORS TRUST, INC. (collectively, “Guarantor” and, with Borrower and Leasehold Pledgor, the “Borrower Parties”) , and CC6 INVESTMENTS LTD. and NC GARNET FUND, L.P. (collectively, and together with their successors and/or assigns, “Lender”). Borrower, Guarantor and Lender are sometimes hereinafter collectively referred to in this Agreement as the “Parties” and each as a “Party.”

 

RECITALS

 

The following recitals are a material part of this Amendment:

 

A.     Borrower, Leasehold Pledgor, Guarantor and Lender entered into that certain Mezzanine B Loan Forbearance Agreement, dated to be effective as of April 7, 2020 (the “Forbearance Agreement”), pursuant to which, among other things, Lender agreed to forbear from exercising certain rights and remedies related to the Existing Default. Unless otherwise defined herein, all initially capitalized terms have the meanings given to them in the Forbearance Agreement.

 

B.     Under the Forbearance Agreement, the Forbearance Period shall expire no later than January 6, 2021 (“Original Forbearance Expiration Date”).

 

C.     Each of the Borrower Parties has requested that Lender agree to (i) extend the Forbearance Expiration Date, and (ii) otherwise amend the Forbearance Agreement, as more particularly described herein, and Lender is willing to do so, but only pursuant to the terms and provisions set forth in this Amendment.

 

D.     In connection with this Amendment, the Mortgage Borrowers are entering into a corresponding forbearance agreement amendment with respect to the Mortgage Loan (the “Mortgage Loan Forbearance Amendment”), on similar terms as set forth herein.

 

E.     In connection with this Amendment, the Mezzanine A Borrowers are entering into a corresponding forbearance agreement amendment with respect to the Mezzanine A Loan (the “Mezzanine A Loan Forbearance Amendment”), on similar terms as set forth herein.

 

NOW, THEREFORE, in consideration of the mutual agreements set forth herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

 

 

 

 

1.     Recitals. The matters stated in the Recitals set forth above are true and accurate in all respects, are a material part of this Amendment, are hereby incorporated by reference, and may be relied upon for all purposes by the Parties.

 

2.     Forbearance Expiration Date; Forbearance Period. Subject to (i) Borrower’s delivery to Lender of the Extension Legal Fee Payment (as defined below), (ii) delivery of the Mortgage Loan Forbearance Amendment and the Mezzanine A Loan Forbearance Amendment, which Mortgage Loan Forbearance Amendment and Mezzanine A Loan Forbearance Amendment shall each have been, prior to its execution, approved in writing by Lender, and (iii) satisfaction of the terms and conditions of this Amendment:

 

(a)     the Forbearance Expiration Date is hereby extended to the earlier to occur of either: (i) April 6, 2021, or (ii) the date a Forbearance Termination Event occurs (the “Extended Forbearance Expiration Date”), and all references to the “Forbearance Expiration Date” in the Forbearance Agreement shall hereafter be deemed to refer to the Extended Forbearance Expiration Date; and

 

(b)     the Forbearance Period is amended to be the time period between the Effective Date of the Forbearance Agreement and the Extended Forbearance Expiration Date.

 

Borrower acknowledges and agrees that it shall have no right or option to extend the Forbearance Expiration Date beyond the Extended Forbearance Expiration Date.

 

3.     Fees Payable to Lender in Connection With Amendment. Upon their execution of this Amendment, Borrower shall owe Lender an amount equal to $10,000.00 (the “Extension Legal Fee Payment”), in order to reimburse Lender for all or part of the fees and costs incurred by Lender in connection with the negotiation and drafting of this Amendment, and to reimburse Lender for any other fees and costs incurred by Lender in connection with the Loan during the Forbearance Period and Extended Forbearance Period. The Extension Legal Fee Payment are payable to Lender as part of, and in the same manner as, the Reimbursement Payment as set forth in the Forbearance Agreement. The Extension Legal Fee shall be paid to Lender together with the execution and delivery of this Amendment by Borrower Parties to Lender, and shall be a prerequisite to the effectiveness of this Amendment. Borrower acknowledges and agrees that additional fees and costs may be payable to Lender hereunder or in accordance with the terms and provisions of the Loan Documents, that such fees and costs, if any, shall be payable to Lender in accordance with the terms of the Forbearance Agreement, and that the Extension Legal Fee Payment shall not be applied to the Indebtedness.

 

4.     Repayment of Forbearance Amounts. Section 4(c) of the Forbearance Agreement is hereby deleted in its entirety and replaced with the following:

 

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“(c)     Notwithstanding anything herein to the contrary, all monthly payment obligations of Borrower owed during the Forbearance Period and until payment in full of the forbearance payments required to be made to Mortgage Lender under the Mortgage Loan Forbearance Agreement, as modified by that certain First Amendment to Forbearance Agreement, dated as of January 7, 2021, with respect to the Mortgage Loan (the “Mortgage Loan Forbearance Amendment”) (or sooner, if paid sooner by Mortgage Borrower in Mortgage Borrower’s discretion) and all other monetary and non-monetary obligations of Borrower under the Mezzanine B Loan Documents shall remain in full force and effect, unmodified by this Agreement, and the Existing Default shall continue in full force and effect. Lender, however, shall, so long as Borrower fully and timely performs its obligations under this Agreement and the Mezzanine B Loan Documents (and so long as Mezzanine A Borrower fully and timely performs its obligations under the Mezzanine A Loan Forbearance Agreement (as modified by that certain First Amendment to Mezzanine A Loan Forbearance Agreement, dated as of January 7, 2021, with respect to the Mezzanine A Loan) and the Mezzanine A Loan Documents, and Mortgage Borrower fully and timely performs its obligations under the Mortgage Loan Forbearance Agreement (as modified by the Mortgage Loan Forbearance Amendment) and the Mortgage Loan Documents), continue to forbear, even after the initial Forbearance Period, solely with respect to the Existing Default, from enforcement of its rights and remedies as set forth and to the same extent called for in this Agreement until the earlier of either the Monthly Payment Date occurring in April 2022 or, in the alternative, such period after the initial Forbearance Period that continues through the occurrence of a Forbearance Termination Event (collectively, the “Extended Forbearance Period”). ”

 

5.     Release. As of the Effective Date, each of the Borrower Parties and its respective past, present and future employees, agents, attorneys, representatives, successors, assigns, and all persons or entities claiming by, through, or under any of them (and their respective successors and assigns, collectively, the “Releasing Parties”) hereby:

 

(a)     acknowledges, agrees and affirms that none of them possesses any claims, defenses, offsets, rights of recoupment or counterclaims of any kind or nature against or with respect to the enforcement or administration of the Loan or the Mezzanine B Loan Documents (including any aspect of the origination, administration or enforcement thereof), or any knowledge of any facts or circumstances that might give rise to or be the basis of any such claims, defenses, offsets, rights of recoupment or counterclaims;

 

(b)     remises, releases, acquits and forever discharges Lender, and its predecessors in interest, affiliates, subsidiaries, participants or assigns, and all of their respective past, present, and future shareholders, certificate holders, members, directors, managers, officers, employees, attorneys, advisers, consultants, servicers, representatives or agents (collectively, the “Lender Released Parties”) from any and all manner of debts, accounts, bonds, warranties, representations, covenants, promises, contracts, controversies, agreements, liabilities, obligations, expenses, damages, judgments, executions, actions, claims, demands and causes of action of any nature whatsoever, whether at law or in equity, whether known or unknown, that any of the Releasing Parties now have or may hereafter have by reason of any act, omission, matter, cause or thing, from the beginning of the world to and including the Effective Date, including matters arising out of or relating to the Loan and the Mezzanine B Loan Documents, including the origination, funding, servicing or administration thereof and any other agreement or transaction between any of the Releasing Parties and any of the Lender Released Parties concerning the Loan (all of the foregoing released claims are sometimes referred to as the “Released Claims”);

 

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(c)     agrees that it is the intention of each of the Releasing Parties that the foregoing release shall be effective with respect to all matters, past and present, known and unknown, suspected and unsuspected. Each of the Releasing Parties realizes and acknowledges that factual matters now unknown to it may have given or may hereafter give rise to losses, damages, liabilities, costs and expenses which are presently unknown, unanticipated and unsuspected, and that each of the Releasing Parties further agrees that the waivers and releases in this Release have been negotiated and agreed upon in light of that realization and that each of the Releasing Parties nevertheless hereby intends to release, discharge and acquit the Lender Released Parties from any such unknown losses, damages, liabilities, costs and expenses; and

 

(d)     agrees that all releases and discharges by each of the Releasing Parties in this Amendment shall have the same effect as if each released or discharged matter had been the subject of a legal proceeding, adjudicated to final judgment from which no appeal could be taken and therein dismissed with prejudice.

 

6.     Ratification of Forbearance Agreement. Except as modified or affected by this Amendment, the Forbearance Agreement is hereby ratified, is unmodified and remains in full force and effect. Each of the Borrower Parties hereby re-makes all of the acknowledgements, confirmations, representations and warranties made in the Forbearance Agreement as if the Forbearance Agreement was executed on the Effective Date.

 

7.     Acknowledgments.

 

(a)     Each of the Borrower Parties acknowledge that Lender is specifically relying upon each of the Borrower Parties acknowledgements and agreements in Sections 5 and 6 hereof in executing this Amendment, and that in the absence of such agreements Lender would be unwilling to agree to the modifications provided for in this Amendment.

 

(b)     Subject to Borrower’s compliance with the terms hereof, Lender hereby consents to the execution and provisions of the Mortgage Loan Forbearance Amendment and the Mezzanine A Loan Forbearance Amendment.

 

8.     Severability. If any one or more of the provisions of this Amendment are deemed unenforceable, the remainder of this Amendment shall, at the sole option of Lender, remain enforceable in accordance with its original terms to the fullest extent possible.

 

9.     Entire Agreement. This Amendment, the Forbearance Agreement, the Loan Documents, and the documents referred to, contemplated, or required herein or therein, constitute the sole and entire agreement between the Parties with respect to the subject matter hereof, and there are no other covenants, promises, agreements or understandings regarding the same.

 

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10.     Counterparts. This Amendment may be executed in more than one counterpart, each of which shall be deemed an original and all of which together shall constitute one and the same document, binding upon all the Parties notwithstanding that all Parties are not signatories to the same counterpart. This Amendment shall become effective when all Parties have executed a counterpart hereof. A signature of a Party by facsimile or other electronic transmission shall be deemed to constitute an original and fully effective signature of such Party.

 

11.     Conflict. In the event of any conflict between the provisions of this Amendment and the provisions of the Forbearance Agreement or any Loan Document, the provisions of this Amendment shall control.

 

 

 

[Signature Pages Follow.]

 

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IN WITNESS WHEREOF, the Parties have executed this Amendment to be effective as of the Effective Date.

 

 

	 	
			LENDER:

			 

			CC6 INVESTMENT LTD.,

			a Cayman Islands exempted company

			 

			By:       Carbon VI GP LLC,

			as its sole director

			 

			By:       BlackRock Realty Advisors, Inc.,

			as its sole member

			 

			 

			 

			By:      /s/ Paul Horowitz

			            Name: Paul Horowitz

			            Title:   Vice President

			 

			 

			NC GARNET FUND, L.P., 

			a Delaware limited partnership

			 

			By:        BlackRock Financial Management, Inc.,

			its investment manager

			 

			 

			 

			By:      /s/ Paul Horowitz

			            Name: Paul Horowitz

			            Title:   Director

			
	 	 
	 	 
	 	 

[Signatures Continue on the Following Page]

 

 

 

 

	 	
			BORROWER:

			 

			 

			 

			HIT PORTFOLIO I MEZZ B, LLC

			a Delaware limited company

			 

			By:         /s/ Jonathan P. Mehlman

			Name: Jonathan P. Mehlman

			Title: President & Chief Executive Officer

			

 

 

 

 

[Signatures Continue on the Following Page]

 

 

 

 

	 	
			LEASEHOLD PLEDGOR:

			 

			 

			 

			HIT PORTFOLIO I TRS MEZZ B, LLC

			a Delaware limited liability company

			 

			 

			By:         /s/ Jonathan P. Mehlman

			Name: Jonathan P. Mehlman

			Title: President & Chief Executive Officer

			 

			 

			HIT 2PK TRS MEZZ B, LLC 

			a Delaware limited liability company

			 

			 

			By:         /s/ Jonathan P. Mehlman

			Name: Jonathan P. Mehlman

			Title: President & Chief Executive Officer

			

 

[Signatures Continue on the Following Page]

 

 

 

 

	 	
			GUARANTOR:

			 

			 

			 

			HOSPITALITY INVESTORS TRUST, INC.,

			a Maryland corporation

			 

			 

			By:         /s/ Jonathan P. Mehlman

			Name: Jonathan P. Mehlman

			Title: President & Chief Executive Officer

			 

			 

			 

			 

			HOSPITALITY INVESTORS TRUST OPERATING 

			PARTNERSHIP, L.P., a Delaware limited partnership

			 

			By: HOSPITALITY INVESTORS TRUST, INC.,

			a Maryland corporation, its general partner

			 

			 

			 

			 

			By:         /s/ Jonathan P. Mehlman

			Name: Jonathan P. Mehlman

			Title: President & Chief Executive OfficerEX-4.3

 Exhibit 4.3 

COMMON STOCK PURCHASE WARRANT 

KEMPHARM, INC. 
  

			
	 Warrant Shares: [_______]
	  	 Initial Exercise Date: January 12, 2021

 THIS COMMON STOCK PURCHASE WARRANT (the “Warrant” and, together with each other Common Stock
Purchase Warrant issued pursuant to the December 2020 Exchange Agreement (as defined below), the “Warrants”) 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 the date hereof (the “Initial Exercise Date”) and on or prior to 5:00 p.m. (New York City time) on January 12,
2026 (the “Termination Date”) but not thereafter, to subscribe for and purchase from KemPharm, Inc., a Delaware corporation (the “Company”), up to [_______] shares (as subject to adjustment hereunder, the
“Warrant Shares”) of Common Stock (as defined below). The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price, as defined in Section 2(b). 

Section 1. Definitions. In addition to the terms defined elsewhere in this Warrant, the following terms have
the meanings indicated in this Section 1: 
 “Affiliate” means any Person that, directly or indirectly
through one or more intermediaries, controls or is controlled by or is under common control with a Person, as such terms are used in and construed under Rule 405 under the Securities Act. With respect to the Holder, any investment fund or managed
account that is managed on a discretionary basis by the same investment manager as the Holder shall, for purposes hereof, be deemed to be an Affiliate of the Holder. 

“Bid Price” means, for any date, the price determined by the first of the following clauses that applies:
(a) if the Common Stock is then listed or quoted on a Trading Market, the bid price of the Common Stock for the time in question (or the nearest preceding date) on the Trading Market on which the Common Stock is 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 the Common Stock is not then listed on a Trading Market, the volume weighted average price of the Common Stock for
such date (or the nearest preceding date) on OTCQB or OTCQX, as applicable, (c) if the Common Stock is not then listed or quoted for trading on a Trading Market or on OTCQB or OTCQX and if prices for the Common Stock are then reported on the
Pink Open Market (or a similar organization or agency succeeding to its functions of reporting prices), the most recent bid price per share of the Common Stock so reported, or (d) in all other cases, the fair market value of a share of Common
Stock as determined by an independent appraiser selected in good faith by the Company and reasonably acceptable to the Required Holders, the fees and expenses of which shall be paid by the Company. 

“Board of Directors” means the board of directors of the Company. 

  
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 “Business Day” means any day other than Saturday, Sunday or
other day on which commercial banks in The City of New York are authorized or required by law to remain closed; provided, however, for clarification, commercial banks shall not be deemed to be authorized or required by law to remain
closed due to “stay at home”, “shelter-in-place”, “non-essential employee” or any other
similar orders or restrictions or the closure of any physical branch locations at the direction of any governmental authority so long as the electronic funds transfer systems (including for wire transfers) of commercial banks in The City of New York
generally are open for use by customers on such day. 
 “Commission” means the United States Securities and
Exchange Commission. 
 “Common Stock” means the common stock of the Company, par value $0.0001 per share,
and any other class of securities into which such securities may hereafter be reclassified or changed. 
 “Common
Stock Equivalents” means any securities of the Company or any Subsidiaries which would entitle the holder thereof to acquire at any time Common Stock, including, without limitation, any debt, preferred stock, right, option, warrant or other
instrument that is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Common Stock. 

“December 2020 Exchange Agreement” means that certain Exchange Agreement and Amendment to Facility Agreement,
Notes and Investors’ Rights Agreement, dated as of December 23, 2020, among the Company, Deerfield Private Design Fund III, L.P., Deerfield Special Situations Fund, L.P. and the other Participating Lenders party thereto, as the same may be
amended, modified or restated from time to time. 
 “Exchange Act” means the Securities Exchange Act of
1934, as amended, and the rules and regulations promulgated thereunder. 
 “Person” means an individual or
corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind. 

“Required Holders” means the holders of Warrants representing a majority of the shares of Common Stock
underlying the Warrants then outstanding. 
 “Securities Act” means the Securities Act of 1933, as amended,
and the rules and regulations promulgated thereunder. 
 “Subsidiary” means any subsidiary of the Company
and shall, where applicable, also include any direct or indirect subsidiary of the Company formed or acquired after the date hereof. 

“Trading Day” means a day on which the Common Stock is traded on a Trading Market; provided, however, that
during any period in which the Common Stock is not traded on a Trading Market, the term “Trading Day” shall mean a Business Day. 

  
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 “Trading Market” means any of the following markets or
exchanges on which the Common Stock is listed or quoted for trading on the date in question: the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the New York Stock Exchange (or any successors to
any of the foregoing). 
 “Transfer Agent” means Computershare Trust Company, N.A., the current transfer
agent of the Company, with a mailing address of 144 Fernwood Avenue, Edison, NJ 08837 and a phone number of 732-417-2700, and any successor transfer agent of the
Company. 
 “VWAP” means, for any date, the price determined by the first of the following clauses that
applies: (a) if the Common Stock is then listed or quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest preceding date) on the Trading Market on which the Common Stock is 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 the Common Stock is not then listed or quoted on a Trading Market, the volume weighted average
price of the Common Stock for such date (or the nearest preceding date) on OTCQB or OTCQX, as applicable, (c) if the Common Stock is not then listed or quoted for trading on a Trading Market or on OTCQB or OTCQX (or on a Trading Market) and if
prices for the Common Stock are then reported on the Pink Open Market (or a similar organization or agency succeeding to its functions of reporting prices), the most recent bid price per share of the Common Stock so reported, or (d) in all
other cases, the fair market value of a share of Common Stock as determined by an independent appraiser selected in good faith by the Company and reasonably acceptable to the Required Holders, the fees and expenses of which shall be paid by the
Company. 
 “Warrants” means this Warrant and other Common Stock purchase warrants issued by the Company
pursuant to the December 2020 Exchange Agreement. 
 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 of a duly executed facsimile copy or PDF copy submitted by e-mail (or e-mail attachment) 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 the aggregate Exercise Price for the shares specified in the applicable Notice of Exercise by
wire transfer or cashier’s check drawn on a United States bank unless the cashless exercise procedure specified in Section 2(c) below is specified in the applicable Notice of Exercise. 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 Shares available hereunder and the Warrant has been exercised in full, in which case, the Holder shall
surrender this Warrant to the 

  
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Company for cancellation within three (3) Trading Days of the date on which 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 Shares available hereunder shall have the effect of lowering the outstanding number of Warrant Shares purchasable hereunder in an amount equal to the applicable number of Warrant Shares purchased. The
Holder and the Company shall maintain records showing the number of Warrant Shares purchased and the date of such purchases. The Company shall deliver any objection to any Notice of Exercise within one (1) Business Day of receipt of such
notice. The Holder and any assignee of the Holder, 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 Shares hereunder, the number of
Warrant Shares available for purchase hereunder at any given time may be less than the amount stated on the face hereof. 

b) Exercise Price. The exercise price per share of Common Stock under this Warrant shall be $6.50, subject to adjustment
hereunder (the “Exercise Price”). 
 c) Cashless Exercise. If at the time of exercise hereof there is
no effective registration statement registering the resale of all of the Warrant Shares by the Holder, or the prospectus contained in such a registration statement is not available for the resale of all of the Warrant Shares by the Holder (subject
to the limitations under Section 2(e) of this Warrant), then this Warrant may also be exercised, in whole or in part, at such time by means of a “cashless exercise” in which the Holder shall be entitled to receive a number of Warrant
Shares 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)(68) 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 Common Stock 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, as adjusted hereunder; and 

  
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	 	(X) =	 the number of Warrant Shares 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. 

 If
Warrant Shares are issued in such a cashless exercise, the parties acknowledge and agree that for purposes of Rule 144 under the Securities Act, the Holder’s holding period for such Warrant Shares shall be deemed to have commenced on or prior
to the date the Holder acquired this Warrant from the Company or an Affiliate of the Company. 
  

	 	d)	 Mechanics of Exercise. 

 

	 	i.	 Delivery of Warrant Shares Upon Exercise. On or before the earliest of (i) two (2) Trading Days
after the delivery to the Company of a Notice of Exercise, (ii) one (1) Trading Day after delivery of the aggregate Exercise Price to the Company in respect of such Notice of Exercise and (iii) the number of Trading Days comprising the
Standard Settlement Period after the delivery to the Company of such Notice of Exercise (such date, the “Warrant Share Delivery Date”), if any Unrestricted Condition (as defined below) is satisfied as of the Exercise Date with
respect to the Warrant Shares issuable pursuant to the applicable Notice of Exercise, the Transfer Agent shall (and the Company shall cause the Transfer Agent to) credit such aggregate number of Warrant Shares to which the Holder shall be entitled
to the Holder’s or its designee’s balance account with The Depository Trust Company (“DTC”) through its Deposit/Withdrawal at Custodian (DWAC) system for the number of Warrant Shares to which the Holder shall be entitled,
or if none of the Unrestricted Conditions is satisfied as of the Exercise Date with respect to the Warrant Shares issuable pursuant to the applicable Notice of Exercise, the Company shall, on or before the Warrant Share Delivery Date, issue and
deliver to the Holder or its designee certificates, registered in the name of the Holder or its designee, representing the aggregate number of shares of Common Stock to which the Holder shall be entitled. Upon delivery of a Notice of Exercise, the
Holder shall be deemed for all corporate purposes to have become the holder of record of the Warrant Shares with respect to which this Warrant has been exercised, irrespective of the date of delivery of the Warrant Shares, provided that payment of
the aggregate Exercise Price (other than in the case of a cashless exercise) is received within the earlier of (i) two (2) Trading Days and (ii) the number of Trading Days comprising the Standard Settlement Period following delivery of the
Notice of Exercise. If the Company fails for any reason to deliver to the Holder the Warrant Shares subject to a Notice of Exercise by the Warrant Share Delivery Date, the Company shall pay to the Holder, in cash, as partial liquidated damages and
not as a penalty, for each $1,000 of Warrant Shares subject to such exercise (based on the VWAP of the Common Stock on the date of the applicable Notice of Exercise), $10 per Trading Day (increasing to $20 per Trading Day on the fifth Trading Day
after such liquidated damages begin to accrue) for each Trading Day after such Warrant Share Delivery Date until such 

  
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Warrant Shares are delivered or the Holder rescinds such exercise. The Company agrees maintain a transfer agent that is a participant in the DTC Fast Automated Securities Transfer Program so long
as this Warrant remains outstanding and exercisable. As used herein, “Standard Settlement Period” means the standard settlement period, expressed in a number of Trading Days, for equity trades effected by U.S. broker-dealers, as in
effect on the date of delivery of the applicable Notice of Exercise. Nothing herein shall limit Holder’s right to pursue any other remedies available to it hereunder, at law or in equity, including a decree of specific performance and/or
injunctive relief with respect to the Company’s failure to timely deliver Warrant Shares upon exercise of this Warrant as required pursuant to the terms hereof. 

ii. Delivery of New Warrants Upon Exercise. If this Warrant shall have been exercised in part, the Company shall, at
the request of the Holder and upon surrender of this Warrant certificate, at the time of delivery of the Warrant Shares, deliver to the Holder a new Warrant evidencing the rights of the Holder to purchase the unpurchased Warrant Shares 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 Shares pursuant to Section 2(d)(i) by the Warrant Share Delivery Date, then the Holder will have the right to rescind such exercise. 

iv. Compensation for Buy-In on Failure to Timely Deliver Warrant Shares Upon
Exercise. In addition to any other rights available to the Holder, if the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares in accordance with the provisions of Section 2(d)(i) above pursuant to an
exercise on or before the Warrant Share 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, shares of Common
Stock to deliver in satisfaction of a sale by the Holder of the Warrant Shares 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 shares of Common Stock so purchased exceeds (y) the amount obtained by multiplying (1) the
number of Warrant Shares that the Company was required to deliver to the Holder in connection with the exercise at issue times (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 and equivalent number of Warrant Shares for which such exercise was not honored (in which case such exercise shall be deemed rescinded) or deliver to the Holder the number of shares
of Common Stock that would have been issued had the Company timely 

  
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complied with its exercise and delivery obligations hereunder. For example, if the Holder purchases Common Stock having a total purchase price of $11,000 to cover a
Buy-In with respect to an attempted exercise of shares of Common Stock 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 shares of Common Stock upon exercise of the Warrant as required pursuant to the terms hereof. 

v. No Fractional Shares or Scrip. No fractional shares or scrip representing fractional shares shall be issued upon the
exercise of this Warrant. As to any fraction of a share 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 share. 
 vi. Charges, Taxes and
Expenses. Issuance of Warrant Shares shall be made without charge to the Holder for any issue or transfer tax or other incidental expense in respect of the issuance of such Warrant Shares, all of which taxes and expenses shall be paid by the
Company, and such Warrant Shares 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 Shares are to be issued in a name other than the
name of the Holder, its prime broker or a similar designee, 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 Transfer Agent 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 delivery of the Warrant Shares. 

vii. Closing of Books. The Company will not close its stockholder books or records in any manner which prevents the
timely exercise of this Warrant, pursuant to the terms hereof. 

  
 7 

	 	viii.	 Authorization of Transfer Agent. Upon the exercise of this Warrant or any part hereof and subject to
delivery of the applicable Exercise Price to the Company as provided in Section 2(a) if this Warrant is effected in accordance with Section 2(b) hereof, the Company shall at its own cost and expense, take all reasonably necessary action,
including obtaining and delivering an opinion of counsel, if reasonably requested by the Transfer Agent, to assure that the Transfer Agent shall credit the Holder’s balance account with DTC or issue stock certificates in the name of Holder (or
its nominee) or such other persons as designated by Holder and in such denominations as Holder shall specify at the time of exercise (in each case, in accordance with Section 2(d)(i)), representing the number of Warrant Shares issuable upon
such exercise. The Company warrants that no instructions other than these instructions have been or will be given to the Transfer Agent and that, unless waived by the Holder, this Warrant and the Warrant Shares issued upon the exercise hereof will
be free-trading, and freely transferable, and will not contain or be subject to a legend (or be subject to any stop transfer instruction) restricting the resale or transferability of such Warrant Shares if any of the Unrestricted Conditions is met.

 e) Holder’s Exercise Limitations. Notwithstanding anything herein to the contrary, but
subject to the last sentence of this Section 2(e), the Company shall not effect any exercise of this Warrant, and a Holder shall not have the right to exercise this Warrant (in whole or in part), to the extent that, after giving effect to an
attempted exercise set forth on the applicable Notice of Exercise, such Holder together with such Holder’s Affiliates, and any other Person whose beneficial ownership of Common Stock would be aggregated with the Holder’s for purposes of
Section 13(d) of the Exchange Act and the applicable rules and regulations of the Commission, including any “group” of which the Holder is a member, would beneficially own a number of shares of Common Stock in excess of the Beneficial
Ownership Limitation (as defined below). Delivery of a Notice of Exercise by a Holder in respect of an exercise of this Warrant shall constitute a representation by such Holder that the issuance of shares of Common Stock in accordance with such
Notice of Exercise will not cause such Holder (together with such Holder’s Affiliates, and any other Person whose beneficial ownership of Common Stock would be aggregated with such Holder’s for purposes of Section 13(d) of the
Exchange Act and the applicable regulations of the Commission) to beneficially own a number of shares of Common Stock in excess of the Beneficial Ownership Limitation, as determined in accordance with this Warrant. For purposes of this
Section 2(e), the number of shares of Common Stock beneficially owned by such Holder and its Affiliates shall include the number of shares of Common Stock issuable upon exercise of this Warrant pursuant to the Notice of Exercise with respect to
which such determination is being made, but shall exclude the number of shares of Common Stock which are issuable upon exercise, exchange or conversion of the unexercised, unexchanged or unconverted portion of this Warrant, any other Warrants and
any other securities of the Company subject to a limitation on conversion, exchange or exercise analogous to the limitation contained herein beneficially owned by such Holder or any of its Affiliates. Except as set forth in the preceding sentence,
for purposes of this Section 2(e), beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. In addition, a determination as to any “group”
status as contemplated above shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations 

  
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promulgated thereunder. For purposes of this Section 2(e), in determining the number of outstanding shares of Common Stock, a Holder may rely on the number of outstanding shares of Common
Stock as stated in the Company’s most recent quarterly or annual report filed with the Commission, or any current report filed by the Company with the Commission subsequent thereto. Upon the written request of a Holder (which may be via
electronic mail), the Company shall within two (2) Trading Days following such request, confirm in writing via electronic mail to such Holder the number of shares of Common Stock then outstanding. In any case, the number of outstanding shares
of Common Stock shall be determined after giving effect to any actual conversion, exchange or exercise of securities of the Company, including this Warrant, by such Holder or its Affiliates since the date as of which such number of outstanding
shares of Common Stock was last publicly reported. The “Beneficial Ownership Limitation” shall be 4.985% of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares of Common
Stock issuable upon the exercise of the Warrants held by the Holder. 
 Section 3. Certain Adjustments.

 a) Stock Dividends and Splits. If the Company, at any time while this Warrant is outstanding: (i) pays a stock
dividend or otherwise makes a distribution or distributions on shares of its Common Stock or any other equity or equity equivalent securities payable in shares of Common Stock (which, for avoidance of doubt, shall not include any shares of Common
Stock issued by the Company upon exercise of this Warrant), (ii) subdivides outstanding shares of Common Stock into a larger number of shares, (iii) combines (including by way of reverse stock split) outstanding shares of Common Stock into a
smaller number of shares, or (iv) issues by reclassification of shares of the Common Stock any shares of capital stock of the Company, then in each case the Exercise Price shall be multiplied by a fraction of which the numerator shall be the
number of shares of Common Stock (excluding treasury shares, if any) outstanding immediately before such event and of which the denominator shall be the number of shares of Common Stock outstanding immediately after such event, and the number of
shares issuable upon exercise of this Warrant shall be proportionately adjusted such 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 for the determination of stockholders entitled to receive such dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or
re-classification. 
 b) 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 Common Stock Equivalents or rights to purchase stock, warrants, securities or other property pro rata to the record holders of any class of
shares of Common Stock (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 shares of Common Stock acquirable upon complete exercise of this Warrant (without regard to any limitations on exercise hereof, including without limitation, the Beneficial Ownership Limitation) immediately before the date on
which a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of shares of Common Stock are to be determined for

  
 9 

 
the grant, issue or sale of such Purchase Rights (provided, however, that, to the extent that the Holder’s right to participate in any such Purchase Right would result in the Holder
exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Purchase Right to such extent (or beneficial ownership of such shares of Common Stock 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 Beneficial Ownership Limitation). 

c) Pro Rata Distributions. 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 shares of Common Stock, by way of return of capital or otherwise (including, without limitation, any distribution of cash, stock or other securities,
property or options by way of a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a “Distribution”), at any time after the issuance of this Warrant, then, in each
such case, the Holder shall be entitled to participate in such Distribution to the same extent that the Holder would have participated therein if the Holder had held the number of shares of Common Stock acquirable upon complete exercise of this
Warrant (without regard to any limitations on exercise hereof, including without limitation, the Beneficial Ownership Limitation) immediately before the date of which a record is taken for such Distribution, or, if no such record is taken, the date
as of which the record holders of shares of Common Stock are to be determined for the participation in such Distribution (provided, however, that, to the extent that the Holder’s right to participate in any such Distribution would
result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Distribution to such extent (or in the beneficial ownership of any shares of Common Stock as a result of such
Distribution to such extent) and the portion of such Distribution shall be held in abeyance for the benefit of the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation).

 d) Fundamental Transaction. 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 or any Subsidiary, 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 Common Stock 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 Common Stock, (iv) the
Company, directly or indirectly, in one or more related transactions effects any reclassification, reorganization or recapitalization of the Common Stock or any compulsory share exchange pursuant to which the Common Stock 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, merger or scheme of arrangement) with another 

  
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Person or group of Persons whereby such other Person or group acquires more than 50% of the outstanding shares of Common Stock (not including any shares of Common Stock 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 Common Stock of the successor or acquiring corporation or of the Company, if it is the surviving corporation, and any additional
consideration (the “Alternate Consideration”) receivable as a result of such Fundamental Transaction by a holder of the number of shares of Common Stock 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 share of Common Stock 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 Common Stock are given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then the Holder shall be given the
same choice as to the Alternate Consideration it receives upon any exercise of this Warrant following such Fundamental Transaction, subject to any restrictions under applicable law. Notwithstanding anything to the contrary, in the event of a
Fundamental Transaction, the Company or any Successor Entity (as defined below) shall, at the Holder’s option, exercisable at any time concurrently with, or within 30 days after, the consummation of the Fundamental Transaction (or, if later,
the date of the public announcement of the applicable Fundamental Transaction), purchase this Warrant from the Holder by paying to the Holder an amount of cash equal to the Black Scholes Value (as defined below) of the remaining unexercised portion
of this Warrant on the date of the consummation of such Fundamental Transaction; provided, however, that, if the Fundamental Transaction is not within the Company’s control, including not approved by the Company’s Board of Directors,
Holder shall only be entitled to receive from the Company or any Successor Entity the same type or form of consideration (and in the same proportion), at the Black Scholes Value of the unexercised portion of this Warrant, that is being offered and
paid to the holders of Common Stock of the Company in connection with the Fundamental Transaction, whether that consideration be in the form of cash, stock or any combination thereof, or whether the holders of Common Stock are given the choice to
receive from among alternative forms of consideration in connection with the Fundamental Transaction; provided, further, that if holders of Common Stock of the Company are not offered or paid any consideration in such Fundamental Transaction, such
holders of Common Stock will be deemed to have received common stock of the Successor Entity (which Entity may be the Company following such Fundamental Transaction) in such Fundamental Transaction. “Black Scholes Value” means the value of
this Warrant based on the Black-Scholes Option Pricing Model obtained from the “OV” function on Bloomberg, L.P. (“Bloomberg”) determined as of the day of 

  
 11 

 
consummation of the applicable Fundamental Transaction for pricing purposes and reflecting (A) a risk-free interest rate corresponding to the U.S. Treasury rate for a period equal to the
time between the date of the public announcement of the applicable contemplated Fundamental Transaction and the Termination Date, (B) an expected volatility equal to the greater of 100% and the 100 day volatility obtained from the HVT function
on Bloomberg (determined utilizing a 365 day annualization factor) as of the Trading Day immediately following the public announcement of the applicable contemplated Fundamental Transaction, (C) the underlying price per share used in such
calculation shall be the greater of (i) the sum of the price per share being offered in cash, if any, plus the value of any non-cash consideration, if any, being offered in such Fundamental Transaction
and (ii) the highest VWAP during the period beginning on the Trading Day immediately preceding the announcement of the applicable Fundamental Transaction (or the consummation of the applicable Fundamental Transaction, if earlier) and ending on
the Trading Day of the Holder’s request pursuant to this Section 3(d) and (D) a remaining option time equal to the time between the date of the public announcement of the applicable contemplated Fundamental Transaction and the
Termination Date and (E) a zero cost of borrow. The payment of the Black Scholes Value will be made by wire transfer of immediately available funds within the later of (i) five Business Days of the Holder’s election and (ii) the
date of consummation of the 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 shares of Common Stock 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 shares of Common Stock 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. 

  
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 e) Calculations. All calculations under this Section 3 shall be
made to the nearest cent or the nearest 1/100th of a share, as the case may be. For purposes of this Section 3, the number of shares of Common Stock deemed to be issued and outstanding as of a given date shall be the sum of the number of shares
of Common Stock (excluding treasury shares, if any) issued and outstanding. 
 f) 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 deliver to the Holder by email a notice setting forth the Exercise Price after such adjustment and any resulting adjustment to the number of Warrant Shares 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 Common Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common Stock, (C) the Company shall authorize the granting to all
holders of the Common Stock rights or warrants to subscribe for or purchase any shares of capital stock of any class or of any rights, (D) the approval of any stockholders of the Company shall be required in connection with any reclassification
of the Common Stock, any consolidation or merger to which the Company (or any of its Subsidiaries) is a party, any sale or transfer of all or substantially all of its assets, or any compulsory share exchange whereby the Common Stock is 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 delivered by email
to the Holder at its last email 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 Common Stock of record to be entitled to such dividend, distributions,
redemption, rights or warrants are to be determined or (y) the date on which such 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 Common Stock of record shall be entitled to exchange their shares of the Common Stock for securities, cash or other property deliverable upon such reclassification, consolidation, merger, sale, transfer or share exchange; provided,
that, notwithstanding the foregoing, any notice delivery requirement under this Section 3(f) shall also be deemed satisfied by filing or furnishing such communication with the Commission via the EDGAR system; and provided, further that the
failure to deliver such notice or any defect therein or in the delivery thereof shall not affect the validity of the corporate action required to be specified in such notice. 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 

  
 13 

 
notice except as may otherwise be expressly set forth herein or as restricted by applicable law. To the extent that any notice provided in this Warrant constitutes, or contains, material
nonpublic information regarding the Company or any of the Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant to a Current Report on Form 8-K. 

iii. Notwithstanding anything in this Warrant to the contrary, the Holder and the Company acknowledge and agree that the
provisions of the last paragraph of Section 5.1 of the Facility Agreement (as defined in the December 2020 Exchange Agreement) shall apply to any notice required or permitted to be given to the Holder hereunder, mutatis mutandis, as if
the Holder were a “Restricted Lender” within the meaning of the Facility Agreement. 
 g) Voluntary Adjustment
By Company. Subject to the rules and regulations of the Trading Market, the Company may at any time during the term of this Warrant, reduce the then current Exercise Price to any amount and for any period of time deemed appropriate by the Board
of Directors. In the event of any adjustment to the exercise price or the amendment or modification of any term of provision of the Public Warrants (as defined below), in each case, in a manner that is favorable to the holders thereof and, if
applied to this Warrant, could be favorable to the Holder, the Company shall offer to the Holder the option to adjust the exercise price or otherwise amend or modify this Warrant in a manner that is proportionate to the applicable adjustment,
amendment or modification of the Public Warrants. “Public Warrants” means the warrants to purchase common stock (other than the pre-funded warrants) offered and sold pursuant to the
Company’s Registration Statement on Form S-1 (File No. 333-250495), as amended. 

Section 4. Transfer of Warrant. 

a) Transferability. This Warrant and all rights hereunder (including, without limitation, any registration rights) 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 on which 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 Shares without having a new Warrant issued. 

  
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 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 initial issuance date of this Warrant and shall be identical with this Warrant except as to the number of Warrant Shares 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. 
 Section 6. Legends. 

a) Restrictive Legend. The Holder understands that until such time as the Warrant Shares have been registered under the
Securities Act or otherwise may be sold pursuant to Rule 144 or an exemption from registration under the Securities Act without any restriction as to the number of securities as of a particular date that can then be immediately sold, the Warrant
Shares may bear a restrictive legend in substantially the following form (and a stop-transfer order consistent therewith may be placed against transfer of the certificates for such securities): 

“THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE
STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER SAID ACT, EXCEPT PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER SAID ACT INCLUDING
PURSUANT TO SECTION 4(A)(7) OF THE SECURITIES ACT OR RULE 144 UNDER SAID ACT OR PURSUANT TO A PRIVATE SALE EFFECTED UNDER APPLICABLE FORMAL OR INFORMAL SEC INTERPRETATION OR GUIDANCE, SUCH AS A SO-CALLED
“4[(a)](1) AND A HALF” SALE.” NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES.” 

  
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 (i) Removal of Restrictive Legends. The certificates (or electronic book entries, if applicable)
evidencing the shares issuable upon exercise hereof shall not contain or be subject to any legend restricting the transfer thereof (including the legend set forth above in subsection 6(a)) or be subject to any stop-transfer instructions:
(A) while a registration statement (including a Registration Statement, as defined in the Investors’ Rights Agreement (as defined in the December 2020 Exchange Agreement) covering the sale or resale of such security is effective under the
Securities Act, or (B) following any sale of such Warrant Shares pursuant to Rule 144, or (C) if such Warrant Shares are eligible for sale under Rule 144(b)(1), or (D) at any time on or after the date hereof on which the applicable
holding period for purposes of subsection (d)(1) of Rule 144 under the Securities Act with respect to such Warrant Shares has been satisfied and the Holder certifies that it is not an Affiliate of the Company, or (E) if it is reasonably
determined by the Company’s counsel that such legend is not required under applicable requirements of the Securities Act (including judicial interpretations and pronouncements issued by the staff of the Commission) (collectively, the
“Unrestricted Conditions”). The Company shall cause the delivery of an instruction letter to the Transfer Agent promptly after the Effective Date (as defined below) or at such earlier time as any of the Unrestricted Conditions has
been met, if required by the Transfer Agent to effect the issuance of the Warrant Shares (or any portion thereof), as applicable, without a restrictive legend or removal of the legend hereunder. If any of the Unrestricted Conditions is met at the
time of issuance of the Warrant Shares, then such Warrant Shares shall be issued free of all legends and stop-transfer instructions. The Company agrees that at such time as any of the Unrestricted Conditions is met or such legend is otherwise no
longer required under this Section 6(b), it will, no later than the earlier of (x) two (2) Trading Days and (y) the number of Trading Days comprising the Standard Settlement Period following the delivery by the Holder to the Company
or the Transfer Agent of a certificate representing Warrant Shares, issued with a restrictive legend, deliver or cause to be delivered to the Holder this Warrant and/or a certificate (or electronic transfer) representing such shares that is free
from all restrictive and other legends (and stop transfer instructions). For purposes hereof, “Effective Date” shall mean the date that the first Registration Statement that the Company is required to file pursuant to the December
2020 Exchange Agreement has been declared effective by the Commission. For the avoidance of doubt, upon any cashless exercise of this Warrant, the Company acknowledges and agrees that an Unrestricted Condition shall have been met and the Warrant
Shares issued in respect of such cashless exercise shall be issued free of all legends and stop transfer instructions so long as the Holder certifies that it is not an Affiliate of the Company in connection with such exercise. Notwithstanding
anything to the contrary contained herein, the Holder shall be deemed to have certified that it is not an Affiliate of the Company upon each delivery of a Notice of Exercise, unless the Holder otherwise advises the Company in writing, 

Section 5. Miscellaneous. 

a) No Rights as Stockholder Until Exercise; No Settlement in Cash. This Warrant does not entitle the Holder to any
voting rights, dividends or other rights as a stockholder of the Company prior to the exercise hereof as set forth in Section 2(d)(i), except as expressly set forth in Section 3. Without limiting any rights of a Holder to receive Warrant
Shares on a “cashless exercise” pursuant to Section 2(c) or to receive cash payments pursuant to Section 2(d)(i) and Section 2(d)(iv) herein, in no event shall the Company be required to net cash settle an exercise of this
Warrant. 

  
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 b) 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 Shares, 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. 

c) 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 Trading Day, then such action may be taken or such right may be exercised on the next succeeding Trading Day. 

d) Authorized Shares. 

The Company covenants that, during the period the Warrant is outstanding, it will reserve from its authorized and unissued
Common Stock a sufficient number of shares to provide for the issuance of the Warrant Shares upon the exercise in full of this Warrant (assuming the cash exercise hereof). 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 Shares may be issued as provided herein without violation of any applicable law or regulation, or of any requirements of the Trading Market upon which the Common Stock 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 Shares in accordance herewith (including upon a
cashless exercise of this Warrant in accordance with Section 2(c)), 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 in accordance with the terms of this Warrant, 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 carry out the provisions of this Warrant and take
any action as reasonably required 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

  
 17 

 
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 Shares 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 to effect such action. 

e) Governing Law. All questions concerning the construction, validity, enforcement and interpretation of this Warrant
shall be governed by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles of conflicts of law thereof. Each party agrees that all legal proceedings concerning the interpretations,
enforcement and defense of the transactions contemplated by this Warrant (whether brought against a party hereto or their respective affiliates, directors, officers, shareholders, partners, members, employees or agents) shall be commenced
exclusively in the state and federal courts sitting in the City of New York. Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in the City of New York, Borough of Manhattan for the
adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not
personally subject to the jurisdiction of any such court, that such suit, action or proceeding is improper or is an inconvenient venue for such proceeding. Each party hereby irrevocably waives personal service of process and consents to process
being served in any such suit, action or proceeding by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Warrant and agrees
that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law. 

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

g) 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. Without limiting any other provision of this Warrant, if either party shall commence an action, suit or proceeding to enforce any
provisions of this Warrant, the prevailing party in such action, suit or 

  
 18 

 
proceeding shall be reimbursed by the other party for their reasonable and documented costs and expenses incurred including, but not limited to, reasonable attorneys’ fees, including those
of appellate proceedings, incurred by such party in collecting any amounts due pursuant hereto or in otherwise enforcing any of its rights, powers or remedies hereunder. 

h) Notices. Any and all notices or other communications or deliveries to be provided by the Holders hereunder including,
without limitation, any Notice of Exercise, shall be in writing and delivered personally, by facsimile or e-mail, or sent by a nationally recognized overnight courier service, addressed to the Company, at 1180
Celebration Blvd. Suite 103, Celebration, FL 34747, Attention: R. LaDuane Clifton, Chief Financial Officer, facsimile number: 321-250-3698, email address:
lclifton@kempharm.com, or such other facsimile number, email address or address as the Company may specify for such purposes by notice to the Holders. Except as otherwise provided in Section 3(f), any and all notices or other communications or
deliveries to be provided by the Company hereunder shall be in writing and delivered personally, by e-mail, or sent by a nationally recognized overnight courier service addressed to each Holder at the e-mail address or address of such Holder appearing on the books of the Company; provided, that the failure to deliver such notice or any defect therein or in the delivery thereof shall not affect the validity of the
corporate action required to be specified in such notice. Except as provided in Section 2 with respect to any Notice of Exercise delivered hereunder, any notice or other communication or deliveries hereunder shall be deemed given and effective
on the earliest of (i) the time of transmission, if such notice or communication is delivered via facsimile at the facsimile number or via e-mail at the e-mail
address set forth in this Section prior to 5:30 p.m. (New York City time) on any date, (ii) the next Trading Day after the time of transmission, if such notice or communication is delivered via facsimile at the facsimile number or via e-mail at the e-mail address set forth in this Section on a day that is not a Trading Day or later than 5:30 p.m. (New York City time) on any Trading Day, (iii) the
second Trading Day following the date of mailing, if sent by U.S. nationally recognized overnight courier service, or (iv) upon actual receipt by the party to whom such notice is required to be given. 

i) Limitation of Liability. No provision hereof, in the absence of any affirmative action by the Holder to exercise this
Warrant to purchase Warrant Shares, 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 Common Stock or as a stockholder of the Company, whether such
liability is asserted by the Company or by creditors of the Company, to the extent permitted under applicable law. 
 j)
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. 

  
 19 

 k) 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 assigns of Holder and any permitted assigns of the Company in accordance with the terms of this Warrant. 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 any holder of Warrant Shares. 

l) Amendment. This Warrant may be modified or amended or the provisions hereof waived with the written consent of the
Company, on the one hand, and the Required Holders, on the other hand; provided that no amendment or waiver will be effective as to the Holder without the written consent of the Holder, unless such amendment or waiver applies to all Warrants on
substantially the same basis. 
 m) 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. 
 n)
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) 

  
 20 

 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. 
  

			
	KEMPHARM, INC.
		
	By:	 	              

		 	Name:
		 	Title:

  
 21 

 NOTICE OF EXERCISE 

TO: KEMPHARM, INC. 
 (1) [__________]
{Insert Holder Name} (the “Holder”) hereby elects to purchase ________ Warrant Shares 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 Shares 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 Shares purchasable pursuant to the cashless exercise procedure set forth in subsection 2(c). 

(3) Please issue said Warrant Shares in the name of the Holder or in such other name as is specified below: 

 

                       
                                         
                         
 The
Warrant Shares shall be delivered to the following DWAC Account Number: 
  

                       
                                         
                         
  

                       
                                         
                         
  

                       
                                         
                         

 ASSIGNMENT FORM 

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

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

Name: 
  

							
				
		  	                                    	  	  
 (Please Print)
	  	
	 Address:
  
	  		  		  	                            
	 Phone Number:
  

Email Address:
	  		  	  
 (Please Print)

 
  
	  	
				
	Dated: _______________ __, ______	  		  	  
	  	
			
	Holder’s Signature:_______________________	  		  	
			
	Holder’s Address:________________________	  		  	

 Schedule of Warrant Holders 

 

					
	 Holder
	  	Shares of Common Stock Issuable
Upon Exercise of Warrant	 
	 Deerfield Private Design Fund III, L.P.
	  	 	2,561,892	 
	 Deerfield Special Situations Fund, L.P.
	  	 	432,936	 
	 Delaware Street Capital Master Fund, L.P.
	  	 	467,631	 
	 M. Kingdon Offshore Master Fund, LP
	  	 	169,560	 
		  	  
	  
	 
	 Total:
	  	 	3,632,019

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