X0306 4 2014-03-14 0 0001196298 NEPHROS INC NEPH 0001413621 Lambda Investors LLC 411 WEST PUTNAM AVENUE SUITE 125 GREENWICH CT 06830 0 0 1 0 0001048462 WEXFORD CAPITAL LP 411 WEST PUTNAM AVENUE SUITE 125 GREENWICH CT 06830 0 0 1 0 0001472112 Wexford GP LLC C/O WEXFORD CAPITAL LP SUITE 125 GREENWICH CT 06830 0 0 1 0 0001001391 DAVIDSON CHARLES E C/O WEXFORD CAPITAL LP 411 WEST PUTNAM AVE. GREENWICH CT 06830 0 0 1 0 0001048485 JACOBS JOSEPH C/O WEXFORD CAPITAL LP 411 WEST PUTNAM AVENUE, SUITE 125 GREENWICH CT 06830 0 0 1 0 Common Stock, par value $0.001 2014-03-14 4 J 0 5250264 A 11971940 I Held directly by Lambda Investors LLC Common Stock, par value $0.001 2014-03-14 4 J 0 27811 A 124803 I Held directly by Wexford Capital LP Class D Warrants 2014-03-14 4 J 0 2935525 A 2007-11-14 2019-03-14 Common Stock 2935525 11742100 I Held directly by Lambda Investors LCC On March 14, 2014, Lambda Investors LLC ("Lambda") exercised certain subscription rights certificates received pursuant to a rights offering with Nephros, Inc. (the "Company"), Lambda received 5,250,264 shares of Common Stock at a purchase price of $0.30 per share for a cost of $1,575,079.12. On March 14, 2014, Wexford Capital LP ("Wexford") exercised certain subscription rights certificates received pursuant to a rights offering with the Company, Wexford received 27,811 shares of Common Stock at a purchase price of $0.30 per share for a cost of $8,343.16. In addition to these shares, since the date of the last group filing, Wexford received 10,834 shares of Common Stock and 39,466 shares of Common which the Company granted to Mr. Arthur Amron and Dr. Paul Mieyal in respect of their service as members of the Board of Directors of the Company. The grant of these shares was reported on Form 4's filed by Mr. Arthur Amron and Dr. Paul Mieyal on August 22, 2013 and January 6, 2014, respectively. Each Form 4 indicated that the shares were assigned to Wexford. This form is jointly filed by Lambda, Wexford, Charles E. Davidson ("Davidson"), Joseph M. Jacobs ("Jacobs") and Wexford GP LLC ("Wexford GP"). The reported securities are held directly by Lambda and by Wexford. Wexford serves as manager, investment advisor or sub-advisor of Lambda, and as such may be deemed to share beneficial ownership of the securities beneficially owned by Lambda, but disclaims such beneficial ownership to the extent such beneficial ownership exceeds its pecuniary interest. Wexford GP, as the general partner of Wexford, may be deemed to share beneficial ownership of the securities beneficially owned by Lambda, but disclaims such ownership to the extent such beneficial ownership exceeds its pecuniary interest. (continued under Footnote (4) below). (continued from Footnote (3) above) Messrs. Davidson and Jacobs, as the controlling persons of Wexford GP, may be deemed to share beneficial ownership of any securities beneficially owned by Lambda for which Wexford serves as manager, investment advisor or sub-advisor, but disclaim such beneficial ownership to the extent such beneficial ownership exceeds their pecuniary interest. The 8,806,575 shares of common stock underlying Class D Warrants held by Lambda Investors had an exercise price of $0.40 per share prior to the rights offering. However, the Class D Warrants contained full ratchet anti-dilution protection provisions, which were triggered in connection with the rights offering. The Class D Warrant provides that if Nephros, Inc. conducts a rights offering, then the number of shares of common stock for which the Class D Warrant was exercisable immediately after the rights offering shall be adjusted to equal the number of shares which a record holder of the same number of shares of common stock for which the Class D Warrant was exercisable immediately prior to the rights offering would own or be entitled to receive after the rights offering. Therefore, the number of Class D Warrants were adjusted from 8,806,575 to 11,742,100.(continued under Footnote (6) below). (continued from Footnote (5) above) Additionally, the Class D Warrant further provides that the per share exercise price in effect immediately prior to the rights offering shall be adjusted to equal (A) the per share exercise price in effect immediately prior to the rights offering multiplied by (B) the number of shares of common stock for which the Class D Warrant was exercisable immediately prior to the rights offering divided by (C) the number of shares of common stock for which the Class D Warrant was exercisable immediately after such adjustment. Therefore, the exercise price per share of the Class D Warrants was also adjusted from $0.40 to $0.30 per share. Nephros, Inc. agreed to amend the expiration date of the existing Class D Warrants held by Lambda Investors from March 10, 2017 to March 14, 2019. Lambda Investors LLC By: Arthur Amron, Vice President and Assistant Secretary 2014-03-18 Wexford Capital LP, By: Wexford GP LLC, its general partner By Arthur Amron, Vice President and Assistant Secretary 2014-03-18 Wexford GP LLC, By Arthur Amron, Vice Presidentand Assistant Secretary 2014-03-18 Charles E. Davidson 2014-03-18 Joseph M. Jacobs 2014-03-18