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THIS WARRANT AND ANY SHARES ACQUIRED UPON THE EXERCISE OF THIS WARRANT HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE
SOLD OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT FILED UNDER SUCH ACT OR PURSUANT TO AN EXEMPTION FROM REGISTRATION
UNDER SUCH ACT.
THIS WARRANT MAY NOT BE SOLD, TRANSFERRED, HYPOTHECATED OR ASSIGNED TO ANY
OTHER PERSON OR ENTITY EXCEPT OFFICERS OF THE WARRANTHOLDER.
WARRANT
TO SUBSCRIBE FOR AND PURCHASE COMMON STOCK OF
SUPERCONDUCTOR TECHNOLOGIES INC.
VOID AFTER 5:00 P.M. SAN FRANCISCO TIME, ON , 2001,
OR IF NOT A BUSINESS DAY, AS DEFINED HEREIN, AT 5:00 P.M.,
SAN FRANCISCO TIME ON THE IMMEDIATELY PRECEDING BUSINESS DAY
THIS CERTIFIES that, for and in consideration of $500, ▇▇▇ ▇▇▇▇▇▇ &
COMPANY ("▇▇▇ ▇▇▇▇▇▇"), or registered assigns, is entitled to subscribe for and
purchase from Superconductor Technologies Inc., a Delaware corporation
(hereinafter the "Company"), at the price of __________ per share (such price,
as from time to time to be adjusted as hereinafter provided, being hereinafter
called the "Warrant Price"), at any time and from time to time but not earlier
than the Commencement Date (as defined below) or later than the Expiration Date
(as defined below), up to 150,000 fully paid, nonassessable shares of Common
Stock, par value $.001 per share, of the Company ("Common Stock"), subject,
however, to the provisions and upon the terms and conditions hereinafter set
forth, including without limitation the provisions of Section 3 hereof.
"Commencement Date" shall mean _______________, 1997, which is one year from
the date hereof. "Expiration Date" shall mean 5:00 P.M., San Francisco time,
on ____________, 2001, which is five years from the date hereof, or if not a
Business Day, as defined herein, at 5:00 P.M., San Francisco time, on the
immediately preceding Business Day. "Business Day" shall mean a day other than
a Saturday, Sunday or other day on which banks in the State of California are
authorized by law to remain closed.
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SECTION 1. EXERCISE OF WARRANT
(a) CASH EXERCISE
This Warrant may be exercised, at any time and from time to time but
not earlier than the Commencement Date or later than the Expiration Date, by
the holder hereof or its permitted assigns (hereinafter referred to as the
"Warrantholder"), in whole or in part (but not as to a fractional share of
Common Stock and in no event for less than 100 shares (unless less than an
aggregate of 100 shares are then purchasable under all outstanding Warrants
held by a Warrantholder)), by the completion of the subscription form attached
hereto and by the surrender of this Warrant (properly endorsed) at the
Company's offices at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇-▇▇▇▇ (or at such other location in the United States as it may designate
by notice in writing to the Warrantholder at the address of the Warrantholder
appearing on the books of the Company), and by payment to the Company of the
Warrant Price, in cash or by certified or official bank check, for each share
being purchased.
(b) NET EXERCISE
Notwithstanding anything to the contrary contained in Subsection 1(a),
the Warrantholder may elect to exercise this Warrant and receive shares on a
"net exercise" basis in an amount equal to the value of this Warrant by
delivery of the subscription form attached hereto and surrender of this Warrant
at the principal office of the Company, in which event the Company shall issue
to Holder a number of shares computed using the following formula:
X= (P)(Y)(A-B)
-----------
A
Where: X= the number of shares of Common Stock to be
issued to Holder.
P= the portion of the Warrant being exercised
(expressed as a fraction).
Y= the total number of shares of Common Stock
issuable upon exercise of this Warrant.
A= the Current Market Price (as determined
pursuant to Subsection 1(d)) of one share
of Common Stock.
B= Warrant Price.
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(c) PROCEDURE FOR EXERCISE
In the event of any exercise of the rights represented by this
Warrant, a certificate or certificates for the total number of whole shares of
Common Stock so purchased, registered in the name of the Warrantholder, shall
be delivered to the Warrantholder within a reasonable time, not exceeding five
Business Days, after the rights represented by this Warrant shall have been so
exercised; and, unless this Warrant has expired, a new Warrant representing the
number of shares (except a remaining fractional share), if any, with respect to
which this Warrant shall not then have been exercised shall also be issued to
the Warrantholder within such time. With respect to any such exercise, the
Warrantholder shall for all purposes be deemed to have become the holder of
record of the number of shares of Common Stock evidenced by such certificate or
certificates, from the date on which this Warrant was surrendered and, if
exercise is pursuant to Section 1(a), payment of the Warrant Price was made,
irrespective of the date of delivery of such certificate, except that, if the
date of such surrender and payment is a date on which the stock transfer books
of the Company are closed, such person shall be deemed to have become the
holder of such shares at the close of business on the next succeeding date on
which the stock transfer books are open. No fractional shares shall be issued
upon exercise of this Warrant and no payment or adjustment shall be made upon
any exercise on account of any cash dividends on the Common Stock issued upon
such exercise. If any fractional interest in a share of Common Stock would,
except for the provisions of this Section 1, be delivered upon any such
exercise, the Company, in lieu of delivering the fractional share thereof,
shall pay to the Warrantholder an amount in cash equal to the current market
price of such fractional interest, as determined below.
(d) CURRENT MARKET PRICE
For any computation hereunder, the current market price per share of
Common Stock on any date shall be deemed to be the average of the daily market
price per share for the 30 consecutive Trading Days commencing 45 Trading Days
before the date in question. "Market Price" is defined as the closing sale
price (or, if no closing sale price is reported, the closing bid price) of the
Common Stock in the over-the-counter market, as reported by the National
Association of Securities Dealers Automated Quotation System ("Nasdaq"), or, if
the Common Stock is not quoted on Nasdaq, as reported by the National Quotation
Bureau Incorporated. In the event that the Common Stock is hereafter listed
for trading on one or more United States national or regional securities
exchanges, Market Price shall be the closing price on the exchange or system
designated by the Board of Directors of the Company as the principal United
States market in which the Common Stock is traded. If Market Price cannot be
established as described above, market price shall be the fair market value of
the Common Stock as determined in good faith by the Board of Directors whose
determination shall be conclusive. The term "Trading Day" shall mean a day on
which Nasdaq or the principal national securities exchange on which the Common
Stock is listed or admitted to trading is open for the transaction of business.
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SECTION 2. ADJUSTMENT OF NUMBER OF SHARES
Upon each adjustment of the Warrant Price for any stock dividend or
distribution or any subdivision or combination of the outstanding shares of the
Common Stock as provided in Section 3, the Warrantholder shall thereafter be
entitled to purchase, at the Warrant Price resulting from such adjustment, the
number of shares (calculated to the nearest tenth of a share) obtained by
multiplying the Warrant Price in effect immediately prior to such adjustment by
the number of shares purchasable pursuant hereto immediately prior to such
adjustment and dividing the product thereof by the Warrant Price resulting from
such adjustment.
SECTION 3. ADJUSTMENT OF WARRANT PRICE
The Warrant Price and the number and kind of shares issuable hereunder
shall be subject to adjustment from time to time upon the happening of certain
events as provided in this Section 3.
(a) ADJUSTMENTS
(1) If at any time prior to the exercise of this Warrant
in full, the Company shall (A) declare a dividend or make a distribution on the
Common Stock payable in shares of its capital stock (whether shares of Common
Stock or of capital stock of any other class); (B) subdivide, reclassify or
recapitalize its outstanding Common Stock into a greater number of shares; (C)
combine, reclassify or recapitalize its outstanding Common Stock into a smaller
number of shares; or (D) issue any shares of its capital stock by
reclassification of its Common Stock (excluding any such reclassification in
connection with a consolidation or a merger that is subject to Section 3(c)),
the Warrant Price in effect at the time of the record date of such dividend,
distribution, subdivision, combination, reclassification or recapitalization
shall be adjusted so that the Warrantholder shall be entitled to receive the
aggregate number and kind of shares which, if this Warrant had been exercised
in full immediately prior to such event, it would have owned upon such exercise
and been entitled to receive by virtue of such dividend, distribution,
subdivision, combination, reclassification or recapitalization. Any adjustment
required by this Section 3 (a) shall be made successively immediately after the
record date, in the case of a dividend or distribution, or the effective date,
in the case of a subdivision, combination, reclassification or
recapitalization, to allow the purchase of such aggregate number and kind of
shares.
(2) If at any time prior to the exercise of this Warrant
in full, the Company shall make a distribution to all holders of the Common
Stock of stock of a subsidiary or securities convertible into or exercisable
for such stock, then in lieu of an adjustment in the Warrant Price or the
number of shares of Common Stock purchasable upon the exercise of this Warrant,
each Warrantholder, upon the exercise hereof at any time after such
distribution, shall be entitled to receive from the Company, such subsidiary or
both, as the Company shall determine, the stock or other securities to which
such Warrantholder would have been entitled if such Warrantholder had exercised
this Warrant immediately prior thereto, all subject to further adjustment as
provided in this Section 3, and the Company shall reserve, for the life of the
Warrant, such securities of such
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subsidiary or other corporation; provided, however, that no adjustment in
respect of dividends or interest on such stock or other securities shall be
made during the term of this Warrant or upon its exercise.
(3) If at any time prior to the expiration of this
Warrant in full, the Company shall issue rights or Warrants to all holders of
Common Stock as such entitling them (for a period expiring within sixty days
after the record date of the determination of stockholders entitled to receive
the same), to subscribe for or purchase Common Stock at a price per share less
than the current market price per share (calculated pursuant to Section 1(d)
above) on such record date, then, in each such case the number of shares
subject to this Warrant thereafter purchasable upon the exercise of this
Warrant shall be determined by multiplying the number of shares of Common Stock
theretofore purchasable upon exercise of each Warrant by a fraction, of which
the numerator shall be the number of shares of Common Stock outstanding on the
date of issuance of such rights or Warrants, plus the number of additional
shares of Common Stock offered for subscription or purchase, and of which the
denominator shall be the number of shares of Common Stock outstanding on the
date of issuance of such rights or Warrants plus the number of shares that the
aggregate offering price of the total number of shares of Common Stock so
offered would purchase at such current market price. For purposes of this
Section 3(a)(3), the issuance of rights or Warrants to subscribe for or
purchase securities convertible into Common Stock shall be deemed to be the
issuance of rights or Warrants to purchase the Common Stock into which such
securities are convertible at an aggregate offering price equal to the
aggregate offering price of such securities plus the minimum aggregate amount
(if any) payable upon conversion of such securities into Common Stock.
(4) If at any time prior to the exercise of this Warrant
in full, the Company shall distribute to all holders of its Common Stock
evidence of indebtedness of the Company or assets of the Company (excluding
cash dividends or distributions out of earned surplus) or rights or Warrants to
subscribe for securities of the Company (excluding those referred to in
Sections 3(a)(2) or (3) above), then in each case the Warrant Price shall be
adjusted to a price determined by multiplying the Warrant Price in effect
immediately prior to such distribution by a fraction, of which the numerator
shall be the then current market price per share of Common Stock (calculated
pursuant to Section 1(d) above) on the record date for determination of
stockholders entitled to receive such distribution, less the then fair value
(as determined by the Board of Directors of the Company, whose determination
shall be conclusive) of the portion of the assets or evidences of indebtedness
so distributed or of such subscription rights or Warrants which are applicable
to one share of Common stock, and of which the denominator shall be the market
price per share of Common Stock; provided, however, that if the then current
market price per share of Common Stock on the record date for determination, of
stockholders entitled to receive such distribution is less than the then fair
value of the portion of the assets or evidence of indebtedness so distributed
or of such subscription rights or Warrants which are applicable to one share of
Common Stock, the foregoing adjustment of the Warrant Price shall not be made
and in lieu thereof the number of shares purchasable upon exercise of each
Warrant immediately prior to such distribution shall be adjusted so that the
holder of such Warrant shall be entitled to receive upon exercise of such
Warrant the kind and number of assets, evidence of indebtedness, subscription
rights and Warrants (or, in the event of the redemption of
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such evidence of indebtedness, subscription rights or Warrants, any cash paid
in respect of such redemption) that such Warrantholder would have owned or have
been entitled to receive after the happening in such distribution had such
Warrant been exercised immediately prior to the record date of such
distribution.
(5) No adjustment in the Warrant Price shall be required
unless such adjustment would require an increase or decrease of at least five
cents ($.05) in such price; provided, however, that any adjustments which by
reason of this Section 3(a)(5) are not required to be made shall be carried
forward and taken into account in any subsequent adjustment. All calculations
under this Section 3(a) shall be made to the nearest cent or to the nearest
tenth of a share, as the case may be. Notwithstanding anything in this Section
3(a) to the contrary, the Warrant Price shall not be reduced to less than the
then existing par value of the Common Stock as a result of any adjustment made
hereunder.
(6) In the event that at any time, as the result of any
adjustment made pursuant to this Section 3(a), the Warrantholder thereafter
shall become entitled to receive any securities other than Common Stock,
thereafter the number of such other securities so receivable upon exercise of
any Warrant shall be subject to adjustment from time to time in a manner and on
terms as nearly equivalent as practicable to the provisions with respect to the
Common Stock contained in Section 3(a).
(7) Notwithstanding the foregoing, no adjustments shall
be made pursuant to Sections 3(a)(2), (3) or (4) hereof unless the Company
directly or indirectly shall make substantially similar adjustments to any
stock options granted pursuant to any stock option plan or otherwise grant
benefits in lieu of such adjustments to the holder of such stock option.
(b) NO ADJUSTMENT FOR DIVIDENDS
Except as provided in Section 3(a) of this Agreement, no adjustment in
respect of any cash dividends shall be made during the term of this Warrant or
upon the exercise of this Warrant.
(c) PRESERVATION OF PURCHASE RIGHTS IN CERTAIN TRANSACTIONS
In case of any reclassification, capital reorganization or other
change of outstanding shares of Common Stock (other than a subdivision or
combination of the outstanding Common Stock and other than a change in the par
value of the Common Stock) or in case of any consolidation or merger of the
Company with or into another corporation (other than a merger with a subsidiary
in which the Company is the continuing corporation and that does not result in
any reclassification, capital reorganization or other change of outstanding
shares of Common Stock of the class issuable upon exercise of this Warrant) or
in the case of any sale, lease, transfer or conveyance to another corporation
or entity of the property and assets of the Company as an entirety or
substantially as an entirety, this Warrant shall become exercisable on the
record date for such event, if this Warrant was not previously exercisable. If
this Warrant is not exercised on or prior to the consummation of any
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such event, then this Warrant shall terminate, if notice of such event was
properly given by the Company pursuant to Sections 5 and 8 of this Agreement.
(d) FORM OF WARRANT AFTER ADJUSTMENTS
The form of this Warrant need not be changed because of any
adjustments in the Warrant Price of the number or kind of the shares
purchasable pursuant to this Warrant, and Warrants theretofore or thereafter
issued may continue to express the same price and number and kind of shares as
are stated in this Warrant, as initially issued, provided, however, that the
Company may, at any time in its sole discretion (which shall be conclusive),
make any change in the form of Warrant certificate that it may deem appropriate
and that does not affect the substance thereof. Any Warrant certificate
thereafter issued, whether upon registration of transfer of, or in exchange or
substitution for, an outstanding Warrant certificate may be in the form so
changed.
(e) TREATMENT OF WARRANTHOLDER
Prior to due presentment for registration of transfer of this Warrant,
the Company may deem and treat the Warrantholder as the absolute owner of this
Warrant (notwithstanding any notation of ownership or other writing hereon) for
all purposes and shall not be affected by any notice to the contrary.
(f) NOTICE OF ADJUSTMENT
Upon any adjustment of the Warrant Price, then and in each such case
the Company shall give written notice thereof, by first-class mail, postage
prepaid, addressed to each Warrantholder at the address of such holder as shown
on the books of the Company, which notice shall state the Warrant Price
resulting from such adjustments setting forth in reasonable detail the method
of calculation and the facts upon which such calculation is based.
(g) STOCK TO BE RESERVED
The Company will at all times reserve and keep available out of its
authorized Common Stock, solely for the purpose of issuance upon the exercise
of this Warrant as herein provided, such number of shares of Common Stock as
shall then be issuable upon the exercise of this Warrant. The Company
covenants that all shares of Common Stock which shall be so issued, upon full
payment of the Warrant Price therefor or as otherwise set forth herein, shall
be duly and validly issued and fully paid and nonassessable and free from all
taxes, liens and charges with respect to the issue thereof, and, without
limiting the generality of the foregoing, the Company covenants that it will
from time to time take all such action as may be required to ensure that the
par value per share, if any, of the Common Stock is at all times equal to or
less than the effective Warrant Price. The Company will take all such action
as may be necessary to ensure that all such shares of Common Stock may be so
issued without violation of any applicable law or regulation, or of any
requirement of any national securities exchange or automated quotation system
upon which the Common Stock
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of the Company may be listed. The Company will not take any action which
results in any adjustment of the Warrant Price if the total number of shares of
Common Stock issued and issuable after such action upon exercise of this
Warrant would exceed the total number of shares of Common Stock then authorized
by the Company's Articles of Incorporation. The Company has not granted and
will not grant any right of first refusal with respect to shares issuable upon
exercise of this Warrant, and there are no preemptive rights associated with
such shares.
(h) ISSUE TAX
The issuance of certificates for shares of Common Stock upon exercise
of any Warrant shall be made without a charge to the Warrantholder for any
issuance tax in respect thereto provided that the Company shall not be required
to pay any tax which may be payable in respect of any transfer involved in the
issuance and delivery of any certificate in a name other than that of the
Warrantholder.
(i) CLOSING OF BOOKS
The Company will at no time close its transfer books against the
transfer of the shares of Common Stock issued or issuable upon the exercise of
this Warrant in any manner which interferes with the timely exercise of this
Warrant.
(j) DEFINITION OF COMMON STOCK
The shares purchasable pursuant to this Warrant shall include only
securities designated as Common Stock of the Company. As used herein the term
"Common Stock" shall mean and include the Common Stock, par value $.001 per
share, of the Company as authorized on the date hereof, or shares of any class
or classes resulting from any recapitalization or reclassification thereof which
are not limited to any fixed sum or percentage and are not subject to redemption
by the Company and in case at any time there shall be more than one such
resulting class, the shares of each class then so issuable shall be
substantially in the proportion which the total number of shares of such class
resulting from all such reclassification bears to the total number of shares of
all such classes resulting from all such reclassification.
SECTION 4. REGISTRATION RIGHTS
(a) DEMAND REGISTRATION
At any time and from time to time but not earlier than the Commencement
Date or later than the Expiration Date, the Warrantholder shall have the right
to make written request of the Company to register under the rules and
regulations (the "Regulations") of the Securities and Exchange Commission (the
"SEC") at least 66-2/3% of the underlying shares of Common Stock which would be
issuable upon exercise of this Warrant pursuant to the terms and conditions of
this Warrant (the "Registrable Stock"). The underlying shares of Registrable
Stock specified in such request or a
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request pursuant to Section 4(c) hereof is referred to hereto as the "Subject
Stock." Promptly upon receipt of such request the Company shall file with the
SEC a registration statement on the applicable form for the registration of the
Subject Stock ("registration statement") and use its best efforts to cause such
registration statement to become effective (including, without limitation,
filing post-effective amendments, appropriate qualifications under applicable
blue sky or other state securities laws, and appropriate compliance with the
Regulations) as soon as practicable to permit or facilitate the sale and
distribution of the Subject Stock. Immediately upon receipt of a request for
registration pursuant to this Section 4(a), the Company shall notify each of
the Warrantholders of such request. The Company is obligated to effect only
one (1) such registration pursuant to this Section 4(a).
Notwithstanding the provisions of this Section 4(a), if the Company
shall furnish to the Warrantholder a certificate signed by the Chief Executive
Officer of the Company stating that in the good faith judgment of the Board of
Directors of the Company it would be seriously detrimental to the Company and
its stockholders for such a registration statement to be filed and it is
therefore essential to defer a filing of such registration statement, the
Company shall have the right to defer such filing for a period of not more than
one hundred twenty (120) days after receipt of the request from the
Warrantholder to effect such a registration; provided, however, that the
Company may not utilize the right more than once in any twenty-four month
period; and provided, further that the Warrantholder may, at any time in
writing, withdraw such request for such registration and therefore preserve the
right provided in this Section 4 (a) for the Warrantholder to request such
registration.
(b) PREPARATION OF DOCUMENTS
Prior to filing a registration statement or any amendments or
supplements thereto with the SEC required hereby, the Company will furnish to
the counsel selected by the Warrantholder copies of all documents proposed to
be filed, which documents will be subject to the timely review of such counsel.
In connection therewith, the Company shall prepare and file a registration
statement on a form then available to it to effect such registration. The
Warrantholder agrees to provide all such information and materials and take all
such action as may be reasonably required in order to permit the Company to
comply with all applicable requirements of the SEC and to obtain any desired
acceleration of the effective date of such registration statement.
(c) PIGGYBACK REGISTRATION
If (but without any obligation to do so) the Company proposes to
register with the SEC any of the Common Stock under the Regulations of the SEC
(other than pursuant to a request under Section 4(a) and other than securities
to be issued pursuant to a stock option or other employee benefit or similar
plan, or in connection with a merger, acquisition, or a Rule 145 transaction),
the Company shall, as promptly as practicable, but at least 30 days prior to
the filing of the applicable registration statement give written notice to the
Warrantholder of its intention to effect such registration. If, within 20 days
after receipt of such notice and after the Commencement Date but before the
Expiration Date, the Warrantholder submits a written request to the Company
specifying
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the amount of Registrable Stock that the Warrantholder proposes to sell, the
Company shall include the shares specified in such request in such registration
statement (and any related qualification under blue sky laws or other
compliance) and the Company shall keep each such registration statement in
effect and maintain compliance with each federal and state law and regulation
as set forth in Section 4(d).
Prior to filing a registration statement pursuant to the Regulations
under which the shares of Common Stock issuable upon exercise of this Warrant
may be included, the Company shall give reasonable notice to the holder(s) of
this Warrant or such shares of Common Stock and shall allow such shares of
Common Stock of the Warrantholder to be included in such registration statement
subject to the following terms and conditions: (i) such shares need not be
included in any underwritten offering if and to the extent that the managing
underwriter determines in its best judgment that their inclusion would impair
the success of the offering provided that (A) if other selling stockholders
without contractual registration rights have requested registration of
securities in the proposed offering, the Company will reduce or eliminate such
securities held by selling stockholders without registration rights before any
reduction or elimination of Registrable Stock; and (B) any such reduction or
elimination (after taking into account the effect of clause (A)) shall be pro
rata to all other selling stockholders with contractual registration rights;
(ii) if shares of Registrable Stock are included in such registration, to the
extent requested in writing by a managing underwriter, if any, of any
registration effected pursuant to Section 4(a) or (c), each holder of
Registrable Stock agrees not to sell, transfer or otherwise dispose of,
including any sale pursuant to Rule 144 under the Securities Act, any Common
Stock, or any other equity security of the Company or any security convertible
into or exchangeable or exercisable for any equity security of the Company
(other than as part of such underwritten public offering) during the time period
reasonably requested by the managing underwriter, not to exceed 180 days,
provided that in no event shall such "lockup" period applicable to the
Warrantholder exceed the length of the shortest "lockup" period applicable to
any other person including shares in such registration (and the Company hereby
also so agrees (except that the Company may effect any sale or distribution of
any such securities pursuant to a registration on Form S-4 (if reasonably
acceptable to such managing underwriter) or Form S-8, or any successor or
similar form which is then in effect or upon the conversion, exchange or
exercise of any then outstanding derivative security relating to Common Stock)
to use its reasonable bests efforts to cause each holder of any equity security
or any security convertible into or exchangeable or exercisable for any equity
security of the Company purchased from the Company at any time other than in a
public offering so to agree); and (iii) the Company shall have no obligation
pursuant to this Section if at the time the registration statement is proposed
to be filed the holders may freely sell the shares of Common Stock issuable upon
exercise of this Warrant pursuant to the Regulations of the SEC.
(d) COVENANTS OF THE COMPANY
In connection with any offering of Subject Stock registered pursuant
to this Warrant, the Company shall (a) furnish to the Warrantholder such number
of copies of any registration statement (including any preliminary prospectus)
as it may reasonably request in order to effect the offering and sale of the
Subject Stock to be offered and sold, but only while the Company shall be
required under the provisions hereof to cause the registration statement to
remain current, (b) take such action as shall be desirable or necessary to
qualify the Subject Stock covered by such registration statement under such
blue sky or other state securities laws for offer and sale as the Warrantholder
shall
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request, and (c) keep the Warrantholder advised in writing as to the initiation
of each registration and as to the completion thereof. Upon any registration
becoming effective pursuant to this Section 4, the Company shall use its best
efforts to: (i) keep such registration statement current for a period of 120
days; (ii) prepare and file with the SEC such amendments and supplements to such
registration statement as may be necessary to comply with the provisions of the
Regulations of the SEC with respect to the disposition of all securities covered
by such registration statement; (iii) cause all such Subject Stock registered
pursuant to such registration statement to be listed on each securities exchange
or automated quotation system on which the Common Stock is then listed; (iv)
provide a transfer agent and registrar for all Subject Stock registered pursuant
to such registration statement and CUSIP number for all such Subject Stock, in
each case not later than the effective date of such registration; and (v)
otherwise use its best efforts to comply with all applicable rules and
regulations of the SEC.
(e) SALES BY THE COMPANY
In connection with any offering of Subject Stock pursuant to Section
4(a), the Company agrees not to effect any public sale or distribution of
Common stock for the seven-day period preceding, and the 90-day period
following, the effective date of any such registration.
(f) EXPENSES
With respect to the registration of Subject Stock pursuant to Section
4(a), together with any inclusion of the Subject Stock in a so-called piggyback
registration pursuant to Section 4(c), the Company will pay all expenses
incident to its performance of or compliance with this Section 4 including,
without limitation, all registration and filing fee, fees and expenses of
compliance with securities or blue sky laws, printing expenses, messenger,
telephone and delivery expenses, and fees and disbursements of its counsel and
independent certified public accountants. The Warrantholder will be responsible
for the underwriting discounts and commissions and any stock transfer taxes,
broker's fees or other direct marketing expenses with respect to shares sold for
its account, all internal management personnel and administrative costs of the
Warrantholder and the fees and expenses of its attorneys, if any, incurred by it
in connection with affecting any such transactions.
(g) INDEMNIFICATION
The Company will, indemnify, to the maximum extent permitted by law,
the Warrantholder, its officers and directors and each person who controls the
Warrantholder (within the meaning of the Regulations of the SEC) against all
losses, claims, damages, liabilities and expenses (or actions, proceedings or
settlements in respect thereof) caused by, arising out of or based on any untrue
or alleged untrue statement of a material fact contained in any registration
statement (or any amendment or supplement thereto) of the Company relating to
the sale of Subject Stock registered pursuant to this Section 4, or any exhibits
or materials incorporated by reference therein, filed with the SEC, or any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading,
except insofar as the same are
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caused by or contained in any information furnished in writing to the Company
by the Warrantholder expressly for use therein.
The Warrantholder will indemnify, to the maximum extent permitted by
law, the Company, its officers and directors and each person who controls the
Company (within the meaning of the Regulations of the SEC) against all losses,
claims, damages, liabilities and expenses (or actions, proceedings or
settlements in respect thereof) caused by, arising out of or based on any
untrue or alleged untrue statement of a material fact contained in any
registration statement (or any amendment or supplement thereto) of the Company
relating to the sale of Subject Stock registered pursuant to this Section 4, or
any exhibits or materials incorporated by reference therein, filed with the
SEC, or any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, but only insofar as the same are caused by or contained in any
information furnished in writing to the Company by the Warrantholder expressly
for use therein.
Any person entitled to indemnification under this Section 4(g) will
(i) give prompt written notice to the indemnifying party of any claim with
respect to which it seeks indemnification and (ii) unless in such indemnified
party's reasonable judgment a conflict of interest between such indemnified and
indemnifying parties may exist with respect to such claim, permit such
indemnifying party to assume the defense of such claim with counsel reasonably
satisfactory to the indemnified party. If such defense is assumed, the
indemnifying party will not be subject to any liability for any settlement made
by the indemnified party without its consent (but such consent will not be
unreasonably withheld). An indemnifying party who is not entitled to, or
elects not to, assume the defense of a claim will not be obligated to pay the
fees and expenses of more than one counsel for all parties indemnified by such
indemnifying party with respect to such claim, unless in the reasonable
judgment of any indemnified party a conflict of interest may exist between such
indemnified party and any other of such indemnified parties with respect to
such claim in which case, the indemnifying party shall be obligated to pay the
fees and expenses of up to two counsel for all parties indemnified by such
indemnifying party with respect to such claim.
The indemnification provisions set forth in this Section 4(g) shall
survive the termination or expiration of this Warrant.
SECTION 5. NOTICES OF RECORD DATES
In the event of:
(a) any taking by the Company of a record of the holders of any
class of securities for the purpose of determining the holders thereof who are
entitled to receive any dividend or other distribution (other than cash
dividends out of earned surplus), or any right to subscribe for, purchase or
otherwise acquire any shares of stock of any class or any other securities or
property, or to receive any right to sell shares of stock of any class or any
other right, or
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(b) any capital reorganization of the Company, any
reclassification or recapitalization of the capital stock of the Company or any
transfer of all or substantially all the assets of the Company to or
consolidation or merger of the Company with or into any other corporation or
entity, or
(c) any voluntary or involuntary dissolution, liquidation or
winding-up of the Company, then and in each such event the Company will give
notice to the Warrantholder specifying (1) the date on which any such record is
to be taken for the purpose of such dividend, distribution or right and stating
the amount and character of such dividend, distribution or right, and (2) the
date on which any such reorganization, reclassification, recapitalization,
transfer, consolidation, merger, dissolution, liquidation or winding-up is to
take place, and the time, if any is to be fixed, as of which the holders of
record of Common Stock will be entitled to exchange their shares of Common
Stock for securities or other property deliverable upon such reorganization,
reclassification, recapitalization, transfer, consolidation, merger,
dissolution, liquidation or winding-up. Such notice shall be given at least 20
days and not more than 90 days prior to the date therein specified, and such
notice shall state that the action in question or the record date is subject to
the effectiveness of a registration statement under the Securities Act or to a
favorable vote of stockholders, if either is required. Failure to mail or
receive such notice or any defect therein shall not affect the validity of any
action with respect thereto.
SECTION 6. NO STOCKHOLDERS RIGHTS OR LIABILITIES
This Warrant shall not entitle the Warrantholder to any voting rights
or other rights as a stockholder of the Company. No provision hereof, in the
absence of affirmative action by the Warrantholder to purchase shares of Common
Stock, and no mere enumeration herein of the rights or privileges of the
Warrantholder shall give rise to any liability of such Warrantholder for the
Warrant Price or as a stockholder of the Company, whether such liability is
asserted by the Company or by creditors of the Company.
SECTION 7. LOST, STOLEN, MUTILATED OR DESTROYED WARRANT
In case the certificate or certificates evidencing the Warrants shall
be mutilated, lost, stolen or destroyed, the Company shall, at the request of
the Warrantholder, issue and deliver in exchange and substitution for and upon
cancellation or the mutilated certificate or certificates, or in lieu of and
substitution for the certificate or certificates lost, stolen or destroyed, a
new Warrant certificate or certificates of like tenor and representing an
equivalent right or interest but only upon receipt of evidence satisfactory to
the Company of such loss, theft or destruction of such Warrant and a bond of
indemnity, if requested, also satisfactory in form and amount at the
applicant's cost. Applicants for such substitute Warrant certificate or
certificates shall also comply with such other reasonable regulations and pay
such other reasonable charges as the Company may prescribe.
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SECTION 8. NOTICES
All notices, requests and other communications required or permitted
to be given or delivered hereunder shall be in writing, and shall be delivered,
or shall be sent by certified or registered mail or overnight courier, postage
prepaid and addressed, or by facsimile, and if to the Warrantholder to such
Warrantholder at such address or facsimile number as shall have been furnished
to the Company by notice from such Warrantholder and if to the Company, at ▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇; Attention:
President, facsimile number (▇▇▇) ▇▇▇-▇▇▇▇, or at such other address or
facsimile number as shall have been furnished to the Warrantholder by notice
from the Company.
SECTION 9. RESTRICTIONS ON TRANSFER
This Warrant may not be sold, transferred, hypothecated or assigned to
any other person or entity except officers of the Warrantholder and in
accordance with all applicable laws, which transfers will be registered on the
stock transfer books of the Company. This Warrant shall bear a legend setting
forth the foregoing restriction.
SECTION 10. AMENDMENTS AND WAIVERS
This Warrant and any term hereof may be changed, waived, discharged or
terminated only by an instrument in writing signed by each of (i) a majority in
interest of the holders of the Registrable Stock and (ii) an authorized
representative of the Company.
SECTION 11. SEVERABILITY
If one or more provisions of this Warrant are held to be unenforceable
under applicable law, such provisions shall be excluded from this Warrant, and
the balance of this Warrant shall be interpreted as if such provision were so
excluded and shall be enforceable in accordance with its terms.
SECTION 12. GOVERNING LAW
This Warrant shall be governed by and construed under the laws of the
State of California without regard to conflict of law principles.
SECTION 13. HEADINGS
The headings in this Warrant are for purposes of reference only and
shall not limit or otherwise affect any of the terms hereof.
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SECTION 14. COUNTERPARTS
This Warrant may be executed in any number of counterparts, each of
which shall be deemed an original but all of which together shall constitute
one and the same instrument.
IN WITNESS WHEREOF, the Company and ▇▇▇ ▇▇▇▇▇▇ have executed this
Warrant on and as of the day and year first above written.
Superconductor Technologies Inc.,
a Delaware corporation
--------------------------------------
▇▇▇▇▇▇ ▇. ▇▇
President and Chief Executive Officer
Attest:
----------------------------------
▇▇▇ ▇▇▇▇▇▇ & Company
--------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Vice President, Corporate Finance
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SUBSCRIPTION FORM
(To be executed upon exercise of this Warrant)
__________________________________:
The undersigned hereby irrevocably elects to exercise the right of
purchase represented by the within Warrant for, and to purchase thereunder,
______________ shares of Common Stock, as provided for therein, and either
tenders herewith payment of the purchase price in full in the form of cash or a
certified or official bank check in the amount of $____________ or, if the
undersigned elects pursuant to Section 1(b) of the within Warrant to convert
such Warrant into Common Stock net issuance, the undersigned exercises the
within Warrant by exchange under the terms of Section 1(b).
Please issue a certificate or certificates for such Common Stock in
the name of, and pay any cash for any fractional share to:
Name:
-------------------------------------
Address:
----------------------------------
Social
Security No:
------------------------------
Signature
---------------------------------
Note: The above signature must correspond
exactly with the name on the first
page of this Warrant or with the
name of the assignee appearing in
the assignment form below.
If said number of shares shall not be all the shares purchasable under
the within Warrant, a new Warrant is to be issued in the name of said
undersigned for the balance remaining of the shares purchasable thereunder
rounded up to the next higher number of shares.
Signature Guaranteed:______________________________
(Signature must be guaranteed by a bank or trust company having an
office or correspondence in the United States or by a member firm of a
registered securities exchange or the National Association of Security Dealers,
Inc.)
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ASSIGNMENT
(To be executed only upon assignment of Warrant)
For value received, ____________________ hereby sells, designs and transfers
unto _____________ the within Warrant Certificate, together with all right,
title and interest therein, and does hereby irrevocably constitute and appoint
__________________ attorney, to transfer said Warrant on the books of the
within-named Company with respect to the number of Warrants set forth below,
with full power of substitution in the premises:
Name(s) of
Assignee(s)/Address No. of Warrants
------------------- ---------------
And if said number of Warrants shall not be all the Warrants represented by the
Warrant, a new Warrant is to be issued in the name of said undersigned for the
balance remaining of the Warrants registered by said Warrant.
Dated: Signature
-------------------- -------------------------
Note: The above signature must
correspond exactly with the
name on the face of this Warrant
Signature Guaranteed:
--------------------------
(Signature must be guaranteed by a bank or trust company having an
office or correspondence in the United States or by a member firm of a
registered securities exchange or the National Association of Security Dealers,
Inc.)
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