Attached files
| file | filename |
|---|---|
| S-1 - NEPHROS INC | v197780_s1.htm |
| EX-5.1 - NEPHROS INC | v197780_ex5-1.htm |
| EX-99.3 - NEPHROS INC | v197780_ex99-3.htm |
| EX-99.2 - NEPHROS INC | v197780_ex99-2.htm |
| EX-99.5 - NEPHROS INC | v197780_ex99-5.htm |
| EX-4.11 - NEPHROS INC | v197780_ex4-11.htm |
| EX-99.4 - NEPHROS INC | v197780_ex99-4.htm |
| EX-10.57 - NEPHROS INC | v197780_ex10-57.htm |
| EX-10.56 - NEPHROS INC | v197780_ex10-56.htm |
| EX-99.6 - NEPHROS INC | v197780_ex99-6.htm |
| EX-99.7 - NEPHROS INC | v197780_ex99-7.htm |
| EX-23.1 - NEPHROS INC | v197780_ex23-1.htm |
Exhibit
99.1
INSTRUCTIONS
FOR USE OF
NEPHROS,
INC. SUBSCRIPTION RIGHTS CERTIFICATES
CONSULT
THE INFORMATION AGENT, YOUR BANK,
OR
YOUR BROKER AS TO ANY QUESTIONS
The
following instructions relate to a rights offering (the “Rights Offering”) by
Nephros, Inc., a Delaware corporation (the “Company”), to the holders of record
(the “Record Holders”) of its common stock, par value $0.001 per share (the
“Common Stock”), as described in the Company’s Prospectus, dated [•], 2010 (the
“Prospectus”). Record Holders of Common Stock at the close of business on [•],
2010 (the “Record Date”) will receive at no charge non-transferable subscription
rights (the “Subscription Rights”) to purchase up to an aggregate of 175,000,000
Units at a subscription price (the “Subscription Price”) of $0.02 per Unit,
for up to an aggregate purchase price of $3,500,000. Each Record Holder
will receive one Subscription Right for each share of Common Stock owned on the
Record Date, evidenced by a subscription rights certificate (the “Subscription
Rights Certificate”) registered in the Record Holder’s name or in the name of
the Record Holder’s nominee. Each Subscription Right will entitle its Record
Holder to purchase 4.185496618 Units at the Subscription Price of $0.02 per Unit
(the “Basic Subscription Privilege”). Each Unit consists of one share of Common
Stock and a warrant to purchase 0.924532845 shares of Common Stock at the
exercise price of $0.02 per share for a period of five years following the
Expiration Date (as defined below).
The
Subscription Rights will expire, if not exercised, at 5:00 p.m., Eastern Time,
on [•], 2010, unless extended in the sole discretion of the Company (as so
extended, the “Expiration Date”). After the Expiration Date, unexercised
Subscription Rights will be null and void. The Company will not be obligated to
honor any purported exercise of the Subscription Rights received by Continental
Stock Transfer & Trust Company (the “Subscription Agent”) after 5:00
p.m., Eastern Time, on the Expiration Date, regardless of when the documents
relating to such exercise were sent. The Company may extend the Expiration Date
by giving oral or written notice to the Subscription Agent on or before the
Expiration Date, followed by a press release no later than 9:00 a.m., Eastern
Time, on the next business day after the previously scheduled Expiration
Date.
There is no minimum number
of Units you must purchase, but you may not purchase fractional Units. To
determine the number of Units you may purchase under your Basic Subscription
Privilege, multiply the number of shares of Common Stock you own by 4.185496618
and round down to the nearest whole number. For example, if you own 100 shares
of Common Stock, you will be entitled to subscribe for up to 418 Units (100
shares × 4.185496618 = 418.5496618, rounded down to 418, the nearest whole
number) under your Basic Subscription Privilege.
If you
exercise your Basic Subscription Privilege in full, you may also subscribe for
additional Units not subscribed for by other Record Holders in the offering at
the same subscription price of $0.02 per Unit, subject to certain limitations
(the “Over-Subscription Privilege”). If an insufficient number of Units is
available to fully satisfy all Over-Subscription Privilege requests, the
available Units will be allocated proportionately among Record Holders who
exercise their Over-Subscription Privileges based on the number of Units each
such Record Holder subscribed for under the Basic Subscription Privilege. See
“The Rights Offering–The Subscription Rights–Over-Subscription Privilege” in the
Prospectus.
The
number of Subscription Rights to which you are entitled is printed on the face
of your Subscription Rights Certificate. You should indicate your wishes with
regard to the exercise of your Subscription Rights by completing the appropriate
portions of your Subscription Rights Certificate and returning the certificate
to the Subscription Agent in the envelope provided pursuant to the procedures
described in these Instructions.
YOUR
SUBSCRIPTION RIGHTS CERTIFICATE AND SUBSCRIPTION PRICE PAYMENT, BY CHECK OR BANK
DRAFT DRAWN ON A U.S. BANK, U.S. POSTAL MONEY ORDER OR BY WIRE TRANSFER OF
IMMEDIATELY AVAILABLE FUNDS, MUST BE ACTUALLY RECEIVED BY THE SUBSCRIPTION
AGENT, OR GUARANTEED DELIVERY REQUIREMENTS WITH RESPECT TO YOUR SUBSCRIPTION
CERTIFICATE MUST BE COMPLIED WITH, ON OR BEFORE 5:00 P.M., EASTERN TIME, ON THE
EXPIRATION DATE. ONCE A HOLDER OF SUBSCRIPTION RIGHTS HAS EXERCISED THE
BASIC SUBSCRIPTION PRIVILEGE AND THE OVER-SUBSCRIPTION PRIVILEGE, SUCH EXERCISE
MAY NOT BE REVOKED. SUBSCRIPTION RIGHTS NOT EXERCISED ON OR PRIOR TO 5:00 P.M.,
EASTERN TIME, ON THE EXPIRATION DATE OF THE RIGHTS OFFERING WILL EXPIRE WITHOUT
VALUE.
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1.
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Method
of Subscription—Exercise of Rights.
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To
exercise Subscription Rights, complete your Subscription Rights Certificate and
send the properly completed and executed Subscription Rights Certificate
evidencing such Subscription Rights, with any signatures required to be
guaranteed so guaranteed, together with payment in full of the Subscription
Price for each Unit subscribed for pursuant to the Basic Subscription Privilege
and the Over-Subscription Privilege, to the Subscription Agent so that it will
be actually received by the Subscription Agent on or prior to 5:00 p.m., Eastern
Time, on the Expiration Date. Payment of the Subscription Price for the Basic
Subscription Privilege and the Over-Subscription Privilege will be held in a
segregated account to be maintained by the Subscription Agent until shares and
warrants to purchase shares of Common Stock are issued upon the expiration of
the Rights Offering and after all pro rata allocations and
adjustments have been completed. All payments must be made in U.S.
dollars for the full number of Units being subscribed for by check or bank draft
drawn on a U.S. bank, or U.S. Postal money order, payable to “Continental Stock
Transfer & Trust Company (acting as subscription agent for Nephros, Inc.)”
or by 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, Acct. # 475-508351 FBO Nephros, Inc.
Subscription, with reference to the rights holder’s name. Please
reference your Subscription Rights Certificate Number on your
check.
The
Subscription Rights Certificate and payment of the Subscription Price (unless
submitted by wire transfer) must be delivered to the Subscription Agent by hand,
mail or overnight courier to the following address:
Continental
Stock Transfer & Trust Company
17
Battery Place, 8th Floor
New
York, NY 10004
(212) 509-4000,
ext. 536
The
risk of delivery of all documents and payments is on you, not us or the
Subscription Agent. Delivery to any address or by a method other than those set
forth above will not constitute valid delivery.
If you
have any questions, require assistance regarding the method of exercising rights
or require additional copies of relevant documents, please contact the
Information Agent, Morrow & Co., LLC, toll-free at (800)
414-4313.
When
making arrangements with your bank or broker for the delivery of funds on your
behalf, you may also request such bank or broker to exercise the Subscription
Rights Certificate on your behalf.
Banks,
brokers, and other nominee holders of Subscription Rights who exercise the Basic
Subscription Privilege and the Over-Subscription Privilege on behalf of
beneficial owners of Subscription Rights will be required to certify to the
Subscription Agent and the Company, in connection with the exercise of the
Over-Subscription Privilege, as to the aggregate number of Subscription Rights
that have been exercised and the number of Units that are being subscribed for
pursuant to the Over-Subscription Privilege, by each beneficial owner of
Subscription Rights (including such nominee itself) on whose behalf such nominee
holder is acting. If more Units are subscribed for pursuant to the
Over-Subscription Privileges than are available, the available Units will be
allocated proportionately among beneficial owners who exercise their
Over-Subscription Privileges based on the number of Units each such owner
subscribed for under the Basic Subscription Privilege.
If the
aggregate Subscription Price paid by you is insufficient to purchase the number
of Units subscribed for, or if no number of Units is specified, then you will be
deemed to have exercised your Subscription Rights to the full extent of the
payment tendered.
2
If the
aggregate Subscription Price paid by you exceeds the amount necessary for the
full exercise of your Subscription Rights, including any Over-Subscription
Privilege exercised or permitted, the excess will be returned to you promptly in
cash. You will not receive interest or a deduction on any payments refunded to
you.
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2.
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Issuance
of Common Stock and Warrants.
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Following
the receipt of a properly completed and executed Subscription Rights
Certificate, together with the payment of the Subscription Price for each Unit
subscribed for, and promptly after all pro rata allocations and
adjustments contemplated by the terms of the Rights Offering have been effected,
the following deliveries and payments will be made to the address shown on the
face of your Subscription Rights Certificate, or, if you hold your shares in
book-entry form, such deliveries and payments will be in the form of a credit to
your account:
|
|
a.
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Basic Subscription
Privilege: The Subscription Agent will deliver to each exercising
Subscription Rights holder one share of Common Stock and a warrant to
purchase 0.924532845 shares of Common Stock for each Unit subscribed for
pursuant to the Basic Subscription Privilege. See “The Rights Offering—The
Subscription Rights—Basic Subscription Privilege” in the
Prospectus.
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b.
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Over-Subscription
Privilege: The Subscription Agent will deliver to each Subscription
Rights holder who validly exercises the Over-Subscription Privilege the
one share of Common Stock and a warrant to purchase 0.924532845 shares of
Common Stock for each Unit, if any, allocated to such Subscription Rights
holder pursuant to the Over-Subscription Privilege. See “The Rights
Offering—The Subscription Rights—Over-Subscription Privilege” in the
Prospectus.
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c.
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Excess Cash Payments:
The Subscription Agent will mail to each Subscription Rights holder who
exercises the Over-Subscription Privilege any excess amount, without
interest or deduction, received in payment of the Subscription Price
for Units that are subscribed for by such Subscription Rights holder but
not allocated to such Subscription Rights holder pursuant to the
Over-Subscription Privilege. See “The Rights Offering—Payment Adjustments”
in the Prospectus.
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3.
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Sale,
Transfer or Assignment of Subscription
Rights.
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Subscription
Rights may not be sold, transferred or assigned; provided, however, that
Subscription Rights are transferable by operation of law (for example, the
transfer of Rights to the estate of a recipient upon the recipient’s
death).
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4.
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Commissions,
Fees and Expenses.
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The
Company will pay all fees and expenses of the Subscription Agent and the
Information Agent related to their acting in such roles in connection with the
Rights Offering. You are responsible for paying any other commissions, fees,
taxes or expenses incurred in connection with the exercise of Subscription
Rights or subscribing for Units. Neither the Subscription Agent nor the Company
will pay such expenses.
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5.
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Execution.
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a.
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Execution by Registered
Holder. The signature on the Subscription Rights Certificate must
correspond with the name of the registered holder exactly as it appears on
the face of the Subscription Rights Certificate without any alteration,
enlargement or change whatsoever. Persons who sign the Subscription Rights
Certificate in a representative or other fiduciary capacity on behalf of a
registered holder must indicate their capacity when signing and, unless
waived by the Subscription Agent in its sole and absolute discretion, must
present to the Subscription Agent satisfactory evidence of their authority
so to act.
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3
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b.
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Signature Guarantees.
If you are neither a registered holder (or signing in a representative or
other fiduciary capacity on behalf of a registered holder) nor an eligible
institution, such as a member firm of a registered national securities
exchange or a member of the Financial Industry Regulatory Authority or a
commercial bank or trust company having an office or correspondent in the
United States, your signature must be guaranteed by such an eligible
institution.
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6.
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Method
of Delivery to Subscription Agent.
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The
method of delivery of Subscription Rights Certificates and payment of the
Subscription Price to the Subscription Agent for each Unit subscribed for will
be at the risk of the holders of Subscription Rights. If sent by mail, we
recommend that you send those certificates and payments by overnight courier or
by registered mail, properly insured, with return receipt requested, and that a
sufficient number of days be allowed to ensure delivery to the Subscription
Agent and clearance of payment at or before 5:00 p.m., Eastern Time, on the
Expiration Date. Because uncertified personal checks may take at least five or
more business days to clear, we urge you to pay or arrange for payment by means
of certified check made payable to “Continental Stock Transfer & Trust
Company (acting as subscription agent for Nephros, Inc.)” to avoid missing the
opportunity to exercise your Subscription Rights should you decide to exercise
them.
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7.
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Guaranteed
Delivery Procedures and Special Provisions Relating to the Delivery of
Subscription Rights through the Depository Trust
Company.
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The
Subscription Agent will grant you three (3) business days after the Expiration
Date to deliver the Subscription Rights Certificate if you follow the following
instructions for providing the Subscription Agent notice of guaranteed delivery.
On or prior to the Expiration Date, the Subscription Agent must receive payment
in full in cash and/or securities, as described under Section 1, “Method of
Subscription–Exercise of Rights,” above, for all Units subscribed for through
the exercise of the Basic Subscription Privilege and the Over-Subscription
Privilege, together with a properly completed and duly executed Notice of
Guaranteed Delivery substantially in the form accompanying the Prospectus either
by mail or overnight carrier, that specifies the name of the registered holder
and the number of Units subscribed for. If applicable, it must state separately
the number of Units subscribed for through the exercise of the Over-Subscription
Privilege and a member firm of a registered national securities exchange, a
member of the Financial Industry Regulatory Authority, Inc., or a commercial
bank or trust company having an office or correspondent in the United States
must guarantee that the properly completed and executed Subscription Rights
Certificate for all Units subscribed for will be delivered to the Subscription
Agent within three business days after the Expiration Date. The Subscription
Agent will then conditionally accept the exercise of the Subscription Rights and
will withhold the certificates for shares of Common Stock and Warrants until it
receives the properly completed and duly executed Subscription Rights
Certificate within the three-business-day time period.
In the case of Subscription Rights that
are held of record through the Depository Trust Company (the “Book-Entry
Transfer Facility”), exercises of Subscription Rights under the Basic
Subscription Privilege and the Over-Subscription Privilege may be effected by
instructing the Book-Entry Transfer Facility to transfer Subscription Rights
from the Book-Entry Transfer Facility account of such holder to the Book-Entry
Transfer Facility account of the Subscription Agent, together with certification
as to the aggregate number of Subscription Rights exercised and the number of
Units thereby subscribed for pursuant to the Basic Subscription Privilege and
the Over-Subscription Privilege by each beneficial owner of Subscription Rights
on whose behalf such nominee is acting, and payment of the Subscription Price
for each Unit subscribed for pursuant to the Basic Subscription Privilege and
the Over-Subscription Privilege.
Notices
of Guaranteed Delivery and payments (unless submitted by wire transfer) should
be mailed or delivered to the appropriate address (or, for wire transfer
payments, to the appropriate account) as described under Section 1, “Method of
Subscription–Exercise of Rights,” above.
4