As filed with the Securities and Exchange Commission on April 22, 1998
Registration No.333-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
ENERGY CONVERSION DEVICES, INC.
(Exact name of registrant as specified in its charter)
Delaware 8731 38-1749884
(State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer
incorporation or organization) Classification Code Number) Identification
No.)
1675 West Maple Road
Troy, MI 48084
(248) 280-1900
(Address, including zip code, and telephone number, including
area code, of Registrant's principal executive offices)
ROGER JOHN LESINSKI, ESQ.
Energy Conversion Devices, Inc.
1675 West Maple Road
Troy, MI 48084
(248) 280-1900
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Copies to:
CRAIG A. ROEDER, ESQ. SIDNEY TODRES, ESQ.
JENNER & BLOCK EPSTEIN, BECKER & GREEN, P.C.
One IBM Plaza 250 Park Avenue
Chicago, IL 60611 New York, NY 10177
(312) 222-9350 (212) 351-4500
Approximate date of proposed commencement of sale to the public:
As soon as practicable after this Registration Statement becomes effective.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box.[ ]
If any of the securities being registered on this Form are to be offered
on a delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933, other than securities offered only in connection with dividend or
interest-reinvestment plans, check the following box.
[X ]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective Registration Statement for the same offering. [ ]
- -----------------------.
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, please check the following box and list the Securities
Act registration statement number of the earlier effective Registration
Statement for the same offering. [ ]
- ------------------------.
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
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<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
=========================================================================================================================
Proposed Proposed
Title of Securities to be Registered Amount to be Maximum Offering Maximum Amount of
Registered Price Per Unit(1) Aggregate Offering Registration Fee
Price(1)
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<S> <C> <C> <C> <C>
Units, each Unit consists of one share 2,000,000 $13.625 $27,250,000.00 $ 8,038.75
Common Stock, $.01 par value, and one
Warrant to purchase one share of Common
Stock, $.01 par value
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Common Stock, $.01 par value, issuable 2,000,000 $21.119 $42,238,000.00 $12,460.21
upon exercise of Warrants
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Placement Agent Warrants to Purchase 80,000 $ .01 $ 800.00 $ .24
Units
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Units issuable upon exercise of Placement 80,000 $17.713 $ 1,417,040.00 $ 418.03
Agent Warrants
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Common Stock, $.01 par value, issuable 80,000 $21.119 $ 1,689,520.00 $ 498.41
upon exercise of Warrants included in
Placement Agent Units
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TOTAL: $21,415.64
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</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c) based on the average of the high and low sales prices of
the Common Stock on the Nasdaq National Market on April 20, 1998.
- ------------
The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant shall
file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until this Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
<PAGE>
ENERGY CONVERSION DEVICES, INC.
CROSS-REFERENCE SHEET
Item Number and Heading in
Form S-3 Registration Statement Location in Prospectus
------------------------------- ----------------------
1. Forepart of the Registration Statement and Outside Front Cover Page
Outside Front Cover Page of Prospectus
2. Inside Front and Outside Back Cover Pages Inside Front Cover Page
of Prospectus
3. Summary Information, Risk Factors and Ratio Risk Factors
of Earnings to Fixed Charges
4. Use of Proceeds Use of Proceeds
5. Determination of Offering Price Outside Front Cover Page;
Plan of Distribution
6. Dilution Risk Factors
7. Selling Security-holders Inapplicable
8. Plan of Distribution Outside Front Cover Page;
Plan of Distribution
9. Description of Securities to be Registered Outside Front Cover Page;
Documents Incorporated by
Reference; Description of
Warrants
10. Interests of Named Experts and Counsel Inapplicable
11. Material Changes Risk Factors
12. Incorporation of Certain Information by Documents Incorporated by
Reference Reference
13. Disclosure of Commission Position on Inapplicable
Indemnification for Securities Act
Liabilities
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Subject to Completion, Dated April 22, 1998
PROSPECTUS
ENERGY CONVERSION DEVICES, INC.
2,000,000 Units
Each Unit consists of one share of Common Stock, $.01 par value,
and one Warrant to purchase one share of Common Stock, $.01 par value,
which are immediately separately transferrable.
--------------
All of the 2,000,000 Units offered hereby are being issued and sold by
Energy Conversion Devices, Inc. (the "Company"). Sales of the Units offered
hereby will be limited to "qualified institutional buyers" as defined in Rule
144A under the Securities Act of 1933, as amended. Janney Montgomery Scott Inc.
("JMS") and Nolan Securities Corporation ("Nolan") are acting as placement
agents for the Units on a best-effort basis. The offer will terminate at 5:00
P.M. Eastern Daylight Time on ________; no minimum number of Units is required
to be sold.
Each Warrant entitles the holder to purchase one share of Common Stock for
$____ on or prior to January 31, 2000, and for $__ at any time thereafter on or
prior to July 31, 2001, the expiration date of the Warrants.
The Company's Common Stock is traded on the Nasdaq Stock Market's National
Market under the symbol "ENER." On April 21, 1998, the closing price of the
Common Stock, as reported by the Nasdaq Stock Market, was $13.313 per share.
There is no public market for the Warrants and there can be no assurances that
anu such market for the Warrants will develop.
An investment in the Units offered hereby involves a high degree of Risk.
See "Risk Factors" on Page 6.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY
STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
--------------
================================================================================
Fees and Proceeds to
Price Commissions(1) the Company (2)
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Per Unit $______ $______ $_____
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Total Units(3) $______ $______ $_____
================================================================================
(1) The Company has agreed to indemnify JMS and Nolan (the "Placement
Agents") against certain liabilities, including liabilities under the Securities
Act of 1933, as amended, and to issue to the Placement Agents as additional
compensation a unit purchase warrant to purchase such number of additional Units
as shall equal 4% of the number of Units sold. (See Plan of Distribution.)
(2) Before deducting expenses payable by the Company, estimated at
approximately $250,000, including reimbursement of certain expenses of the
Placement Agents.
(3) Assumes all 2,000,000 Units offered hereby are sold.
JANNEY MONTGOMERY SCOTT INC. NOLAN SECURITIES CORPORATION
Placement Agents
The date of this Prospectus is April __, 1998.
<PAGE>
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may any
offers to buy be accepted prior to the time the registration statement becomes
effective. This Prospectus shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sales of these securities
in any State in which such offer, solicitation or sale would be unlawful prior
to the registration or qualification under the securities laws of any such
State.
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No dealer, salesman, or any other person has been authorized to give any
information or to make any representations other than those contained in this
Prospectus in connection with the offering herein contained and, if given or
made, such information or representations must not be relied upon as having been
authorized by the Company. This Prospectus does not constitute an offer to sell,
or a solicitation of an offer to buy, the securities offered hereby in any
jurisdiction to any person to whom it is unlawful to make an offer or
solicitation. Neither the delivery of this Prospectus nor any sale made
hereunder shall, under any circumstances, create an implication that there has
been no change in the facts herein set forth since the date hereof.
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AVAILABLE INFORMATION
The Company is subject to the information requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and, in accordance
therewith, files reports, proxy statements and other information with the
Securities and Exchange Commission (the "Commission"). Such material may be
inspected and copies made at the regional offices of the Commission at Seven
World Trade Center, Suite 1300, New York, New York 10048, and at Citicorp
Center, 500 West Madison Street, Suite 1400, Chicago Illinois 60661-2511. This
material may also be inspected and copies made at and, upon written request
copies obtained at prescribed rates from the Public Reference Section of the
Commission at Room 1024 at its principal office, Judiciary Plaza, 450 Fifth
Street, N.W., Washington, D.C. 20549. The Commission maintains a Web site that
contains reports, proxy and information statements and other information of
registrants that file electronically with the Commission pursuant to the EDGAR
system. The address of the Commission's Web Site is http://www.sec.gov.
The Company has filed with the Commission in Washington, D.C. a registration
statement on Form S-3 (the "Registration Statement") under the Securities Act of
1933 with respect to the securities covered by this Prospectus. As permitted by
the rules and regulations of the Commission, this Prospectus does not contain
all of the information set forth in the Registration Statement. For further
information with respect to the Company and the securities offered hereby,
reference is made to the Registration Statement, including the exhibits filed or
incorporated as a part thereof. Statements contained herein concerning the
provisions of documents filed with, or incorporated by reference in, the
Registration Statement as exhibits are necessarily summaries of such documents
and each such statement is qualified in its entirety by reference to the copy of
the applicable documents filed with the Commission.
DOCUMENTS INCORPORATED BY REFERENCE
The Company's (i) Annual Report on Form 10-K/A (Amendment No. 1) for the
fiscal year ended June 30, 1997, (ii) Quarterly Reports on Form 10-Q for the
periods ended September 30, 1997 and December 31, 1997, and (iii) description of
the Common Stock of the Company included in the Company's Registration Statement
on Form 8-A as filed with the Commission
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on November 27, 1968, including any amendments or reports filed for the purpose
of updating such description, are incorporated in and made a constituent part
of this Prospectus by reference. All documents filed by the Company with the
Commission pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act
after the date of this Prospectus and prior to termination of the offering of
the Units covered by this Prospectus shall likewise be deemed incorporated
herein and made a constituent part hereof by reference from the respective dates
of filing.
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained herein
or in any subsequently filed document that is also incorporated by reference
herein modifies or replaces such statement. Any statements so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
Upon oral or written request, the Company will provide without charge a copy
of any document incorporated in this Prospectus by reference, exclusive of
exhibits unless specifically incorporated herein by reference, to each person to
whom this Prospectus is delivered. Requests for such documents should be
directed to the Secretary of the Company, 1675 West Maple Road, Troy, MI 48084.
TABLE OF CONTENTS
Page
----
Available Information ................................................. 3
Documents Incorporated By Reference ................................... 3
Special Note Regarding Forward-Looking Statements ..................... 5
The Company ........................................................... 5
Risk Factors .......................................................... 6
Description of Warrants ............................................... 10
Use of Proceeds ....................................................... 11
Plan of Distribution .................................................. 11
Validity of Securities ................................................ 12
Experts ............................................................... 12
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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Prospectus and the documents incorporated herein by reference contain
forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933 (the "Securities Act") and Section 21E of the Securities Exchange
Act of 1934 (the "Exchange Act" ) which are not historical facts and involve
risks and uncertainties that could cause actual results to differ materially
from those expected and projected. These forward-looking statements concern,
among other things, the Company's expectations, plans and strategies for the
development and commercialization of products based on its technologies and are
generally identified by the use of such terms as "intends," "expects," "plans,"
"projects," "estimates," "anticipates," "should" and "believes."
All of such forward-looking statements are based on assumptions which the
Company, as of the date of this Prospectus, believes to be reasonable and
appropriate. The Company cautions, however, that the actual facts and conditions
that may exist in the future could vary materially from the assumed facts and
conditions upon which such forward-looking statements are based.
The factors discussed in this Prospectus under "Risk Factors" and in other
documents and reports filed by the Company with the Securities and Exchange
Commission pursuant to the requirements of the federal securities laws could
cause the actual facts and conditions that may exist in the future to vary
materially from the assumed facts and conditions upon which the forward-looking
statements contained herein are based.
THE COMPANY
The Company is in the business of synthesizing new materials and developing
advanced production technology and innovative products based on amorphous
(disordered) and related materials, with an emphasis on alternative energy and
advanced information technologies. The Company's products and production
technology in the field of alternative energy are being manufactured and
marketed through alliances throughout the world with major companies, such as
General Motors Corporation and Canon, Inc. In the field of information
technology, the Company's Ovonic phase change erasable optical memory technology
is licensed by major optical memory disk manufacturers, including Matsushita
Electric Industries Co., Ltd. and Sony Corporation.
The Company's principal executive offices are located at 1675 West
Maple Road, Troy, Michigan 48084, and its telephone number is (248) 280-1900.
Recent Events
The Company recently received, subject to closing, a line of credit of up
$5 million to be secured by the Company's inventory and accounts receivable and
a line of credit of up to $6 million for the refinancing of currently or
previously leased manufacturing equipment, the
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sale and leaseback of certain other manufacturing equipment owned by the Company
and the purchase of additional equipment.
RISK FACTORS
The following risk factors should be considered in conjunction with the
other information included and incorporated by reference in this Prospectus
before purchasing or otherwise acquiring the Units offered hereby.
History of Losses
From its founding through December 31, 1997, the Company has incurred net
losses totaling approximately $182.9 million. The Company's ability in future
years to achieve profitability will depend largely on securing additional
licensing agreements and the successful commercialization of its products as to
which there can be no assurance.
Need to Raise Additional Capital
The Company has in the past experienced substantial losses and negative
cash flow from operations and has required significant additional financing in
order to pursue the commercialization of products based on its technologies. The
Company cannot predict when or if additional financing will be needed or, if
needed, in what amounts and may seek additional financing at any time, including
the next 12 months. There can be no assurance that such additional financing
will be available or that the terms of such additional financing, if available,
will be acceptable to the Company. Additional equity financing by the Company
may result in substantial dilution to the Company's stockholders, including
purchasers of the Units.
The Company is currently in the process of finalizing a definitive
agreement for a line of credit of up to $5 million to be secured by the
Company's inventory and accounts receivable and has line of credit of up to $6
million for the refinancing of currently or previously leased manufacturing
equipment, the sale and leaseback of certain other manufacturing equipment owned
by the Company and the purchase of additional equipment, no part of which line
has been taken down.
Dependence Upon Licensing Arrangements and Joint Ventures
In the fields of consumer rechargeable batteries, electric vehicle
batteries, scooter batteries, photovoltaics and information technologies, the
Company has entered into licensing and/or joint venture agreements with estab-
lished industrial companies. Any revenues or profits which may be derived
by the Company from these licensing and joint venture agreements will be sub-
stantially dependent upon the willingness and ability of the Company's licensees
and joint venture partners to devote their financial resources and manufacturing
and marketing capabilities to commercialize products based on the Company's
technologies. There can be no assurance that such financial resources will be
available or that such commercialization will be successful. Certain of the
Company's joint venture and business agreements contain conditions which, if not
satisfied, permit the joint venture or business partner to discontinue such
arrangements. Many of such conditions are outside of the Company's control and
there can accordingly be no assurance that such conditions will be satisfied.
There are also various business, technological and other uncertainties that
affect the Company and its joint venture partners and licensees. In fields in
which it is not presently a party to joint venture or license agreements, the
Company may be required to enter into collaborative arrangements with
established industry partners to produce products on a
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commercial scale. There can be no assurance that the Company will be able to
enter into such collaborative arrangements.
Concentration of Revenues
The Company historically has entered into agreements with a relatively
small number of major customers throughout the world. For the six months ended
December 31, 1997, three major customers--General Motors Corporation, GM Ovonic
L.L.C. ("GM Ovonic") and G.P.Batteries International, Ltd. ("G.P. Batteries")--
accounted for approximately 61% of total revenue. GM Ovonic and GP Batteries
accounted for approximately 56% of total revenue for the year ended June 30,
1997.
Competition
The Company and its affiliates compete with firms, both domestic and
foreign, that perform research and development, as well as firms that
manufacture and sell products. Some competing firms are among the largest
industrial companies in the world and have well-established business
organizations and product lines, extensive resources and large research and
development staffs and facilities. There can be no assurance that one or more
such companies will not succeed in developing technologies or products that will
become available for commercial sale prior to the Company's products, that will
have performance superior to the Company's products or that would otherwise
render the Company's products obsolete or non-competitive.
Technology Risks
Additional research and development efforts will be required before certain
of the Company's products and technologies may be manufactured and sold
commercially. There can be no assurance that such research and development
efforts will be successful or that the Company will be able to develop
commercial applications for its products and technologies. The areas in which
the Company is developing technologies and products are characterized by rapid
and significant technological change. Rapid technological development may result
in the Company's products becoming obsolete or non-competitive before the
Company is able to recover any portion of the research and development and other
expenses it has incurred to develop its products and technologies.
Manufacturing Uncertainties
In order to produce products on a commercial scale, the Company and its
joint venture partners and certain of its licensees will be required to expand
or establish manufacturing capabilities significantly greater than the
manufacturing capabilities currently being used to produce certain of the
Company's products. Although substantially all of its joint venture partners and
licensees have experience in commercial scale manufacturing, the Company has
little such experience and there can be no assurance that the Company or such
other parties will expand or establish manufacturing capabilities for
manufacturing the Company's products beyond those presently in existence.
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Uncertainty of Market Acceptance
The market prices for the Company's products may exceed the prices of
competitive products based on current technologies or new products based on
technologies currently under development by competitors. There can be no
assurance that the prices of the Company's products will be perceived by
consumers as cost-effective or that the prices of such products will be
competitive with existing products or with other new products or technologies.
Uncertainty of Patents and Protection of Proprietary Technology
The Company's ability to compete effectively will depend, in part, on its
ability to protect and maintain the proprietary nature of its technology. There
can be no assurance as to the degree of protection offered by the patents owned
by the Company, or as to the likelihood that additional patents will be issued
based upon pending patent applications. Patent applications in the United States
are maintained in secrecy until patents are issued and the Company, therefore,
cannot be certain that it was the first creator of the inventions covered by its
patents or pending patent applications, or that it was the first to file patent
applications for such inventions. The high costs of enforcing patent and other
proprietary rights may also limit the degree of protection afforded the Company.
Claims alleging the invalidity of the Company's patents, such as proceedings
which have been brought in the French and German patent offices seeking to have
certain of the Company's issued patents nullified, or other proprietary rights,
even if unfounded, may have a material adverse effect on the commercialization
of products or technologies based on such rights. The Company also relies on
unpatented proprietary technology, and there can be no assurance that others may
not independently develop the same or similar technology or otherwise obtain
access to the Company's proprietary technology. There can be no assurance that
the Company's patents or other proprietary rights will be determined to be valid
or enforceable if challenged in court or administrative proceedings or that the
Company's patents or other proprietary rights, even if determined to be valid,
will be broad enough in scope to enable the Company to prevent third parties
from producing products using similar technologies or processes. There can also
be no assurance that the Company will not become involved in disputes with
respect to the patents or proprietary rights of third parties. See " - Legal
Proceedings." An adverse outcome from such proceedings could subject the Company
to significant liabilities to third parties, require disputed rights to be
licensed from third parties, prevent the Company from collecting royalties from
licensees or require the Company to stop using such technology, any of which
would have a material adverse effect on the Company's financial condition and
business prospects.
Dependence on Key Personnel
The Company's success is highly dependent on the continued services of a
limited number of skilled managers and scientists. The loss of any of these
individuals could have a material adverse effect on the Company. In addition,
the success of the Company will depend upon, among other factors, the
recruitment and retention of additional highly skilled and experienced
management and technical personnel. There can be no assurance that the Company
will be able to retain existing employees or to attract and retain additional
personnel
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on acceptable terms given the competition for such personnel in industry,
universities and non-profit research institutions.
Legal Proceedings
Although there are no currently pending legal proceedings to which the
Company is a party which management believes to be material, the Company is
involved in legal proceedings arising in the normal course of business. Due to
the inherent uncertainties of legal proceedings, the outcome of any such
proceedings could be unfavorable, and the Company may choose to make payments,
or enter into other arrangements, to settle such proceedings or may be required
to pay damages or other expenses, which could have a material adverse effect on
the Company's financial condition or results of operations. The Company has been
subject to legal proceedings in recent years involving the validity and
enforceability of certain of its patents. While such patent-related legal
proceedings have been successfully resolved in favor of the Company, such
proceedings can require the expenditure of substantial management time and
financial resources and can adversely affect the financial performance of the
companies involved. There can be no assurance that the Company will not be a
party to other legal proceedings in the future.
Concentration of Ownership
Mr. Stanford R. Ovshinsky and his wife, Dr. Iris M. Ovshinsky (executive
officers, directors and co-founders of the Company), own of record 153,420
shares and 65,601 shares, respectively (or approximately 69.8% and 29.8%,
respectively), of the outstanding shares of Class A Common Stock, which are
entitled to 25 votes per share, as compared to the Common Stock which has one
vote per share. Mr. and Dr. Ovshinsky also have the right to acquire 126,082 and
84,055 shares, respectively, of Class A Common Stock pursuant to the exercise of
presently exercisable stock options. Class A Common Stock is convertible into
Common Stock on a share-for-share basis at any time and from time to time at the
option of the holders, and will be deemed to be so converted on September 14,
1999, unless such conversion date is extended with the approval of the Company's
stockholders. As of March 31, 1998, Mr. Ovshinsky also had the right to vote
126,500 shares of Common Stock owned by Sanoh Industrial Co., Ltd. which shares,
together with the shares of Class A Common Stock and 9,989 shares of Common
Stock owned by Mr. and Dr. Ovshinsky, give Mr. and Dr. Ovshinsky voting control
over outstanding shares representing approximately 34.5% of the combined voting
power of the Company (approximately 50.5% in the event they exercise their
options to acquire Class A Common Stock).
Upon completion of this offering, assuming the sale of all 2,000,000 Units
offered hereby (without giving effect to the exercise of the Warrants), the
directors and executive officers of the Company will have voting control over
outstanding shares representing approximately 30.6% of the combined voting power
of the Company.
The Company may, from time to time in the future, grant stock options or
warrants to Mr. and Dr. Ovshinsky and other directors and executive officers of
the Company, which may increase the combined voting power of the Company
controlled by these persons.
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The Company, the Company's 93.5%-owned subsidiary, Ovonic Battery Company,
Inc. ("Ovonic Battery"), and Mr. Ovshinsky are parties to an employment
agreement providing for Mr. Ovshinsky's right to vote the shares of Ovonic
Battery held by the Company following a change in control of the Company,
enabling Mr. Ovshinsky to control Ovonic Battery and direct its business and
affairs notwithstanding a change in the control of the Company.
The foregoing provisions, together with other provisions of the Company's
Certificate of Incorporation and Bylaws, may have the effect of deterring
hostile takeovers or delaying or preventing changes in the control or management
of the Company, including transactions in which stockholders might otherwise
receive a premium for their shares over prevailing market prices. The Company
may, in the future, adopt additional provisions by amendment of its Certificate
of Incorporation or Bylaws or extend the effectiveness of existing provisions
which could have similar
effects.
Possible Volatility of Stock Price
There has been a history of significant volatility in the market price of
the Company's Common Stock. The Company believes that many factors, including
actual or anticipated announcements of technological innovations, new commercial
products, actual or anticipated changes in laws and governmental regulations,
disputes relating to patents or proprietary rights, changes in business
practices and other factors may have a significant effect on the market price of
the Company's Common Stock.
Dilution
The net tangible book value per share of Common Stock at December 31, 1997
was $1.80. Giving effect to the net proceeds from the sale of the 2,000,000
Units offered hereby, the pro forma net tangible book value at December 31,
1997, would have been $___ per share (attributing no value to the Warrants
included in the Units). Purchasers of the Units will, therefore, suffer an
immediate and substantial dilution of $____ in the net tangible book value per
share of the Common Stock from the offering price (attributing no value to
the Warrants included in the Units). In addition, such purchasers will
experience dilution upon the exercise of outstanding stock options and warrants.
As of March 31, 1998, 3,166,257 shares of Common Stock were reserved for
issuance pursuant to the Company's stock option plans. In addition, 474,624
shares of Common Stock were reserved for issuance upon exercise of certain
warrants (other than the Warrants), 219,913 shares of Common Stock were reserved
for the conversion of Class A Common Stock into Common Stock and 6,021 shares of
Common Stock were reserved for conversion of Convertible Investment
Certificates. Future capital funding transactions necessary to fund the
continued operations of the Company may also result in dilution to purchasers of
the Units offered hereby.
DESCRIPTION OF WARRANTS
Each Warrant entitles the holder to purchase one share of Common Stock at
$____ per share (equal to 135% of the per Unit offering price of the Units
offered hereby) on or prior to
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January 31, 2000 and at $____ per share (equal to 155% of the per Unit offering
price of the Units offered hereby) at any time thereafter and on or prior to
July 31, 2001, the expiration date of the Warrants.
Warrants are issuable pursuant to a Warrant Agreement between the Company
and the State Street Bank and Trust Company as Warrant Agent. The Warrant
Agreement provides for adjustment of the exercise price of the Warrants and for
change of the number and kind of shares of Common Stock or other securities
purchasable upon exercise of the Warrants upon occurrence of certain events in
order to protect the warrantholders against dilution. The events requiring such
adjustments and changes include stock dividends, split-ups, combinations and
reclassification.
USE OF PROCEEDS
The net proceeds to the Company from the sale of the Units offered hereby
(without giving effect to the exercise of the Warrants) are estimated to be
approximately $__ million. The Company intends to invest approximately $2.5
million of the net proceeds of this offering in United Solar Systems Corp., the
Company's joint venture with Canon Inc. of Japan, for the production and sale of
photovoltaic products, and approximately $2 million for upgrading Ovonic
Battery's production facilities, with the balance of the net proceeds to be used
for working capital, funding of the Company's ongoing product development
activities and other general corporate purposes.
PLAN OF DISTRIBUTION
The 2,000,000 Units offered hereby are being issued and sold by the
Company, for whom Janney Montgomery Scott Inc. and Nolan Securities Corporation
are acting as placement agents (the "Placement Agents"), to "qualified
institutional buyers" as defined in Rule 144A under the Securities Act of 1933.
No Units will be issued or sold to purchasers other than the foregoing
institutional buyers. The Company has agreed to pay the Placement Agents a fee
equal to six percent of the gross proceeds to the Company from the sale of the
Units. The Company has also agreed to issue the Placement Agents unit purchase
warrants (the "Placement Agent Warrants") to acquire units of the Company's
securities identical to the Units offered hereby, in an amount equal to four
percent of the number of Units sold, at an exercise price per unit equal to 130%
of the per Unit price of the Units offered hereby. The Placement Agent Warrants
are exercisable at any time, in whole or in part, for a four-year period
commencing one year following the date of issuance. The Company has granted
demand and piggy-back registration rights, at the Company's expense (limited to
$15,000 with respect to a demand registration), for the securities issuable upon
exercise of the Placement Agent Warrants.
The Company has agreed to pay or reimburse the Placement Agents for their
reasonable expenses incurred in connection with this offering up to a maximum of
$100,000, of which $25,000 has been paid. The Company has also agreed to
indemnify the Placement Agents and certain related parties against certain civil
liabilities, including liabilities arising under the Securities Act of 1933.
11
<PAGE>
The selling price of the Units offered hereby will be determined by
negotiation between the Company, the Placement Agents and the purchasers based
on the trading price of the Company's Common Stock on the NASDAQ National Market
System.
VALIDITY OF SECURITIES
The validity of the securities being sold in the offering has been passed
upon for the Company by Jenner & Block, Chicago, Illinois.
EXPERTS
The financial statements incorporated in this Prospectus by reference from
the Company's Annual Report on Form 10-K/A (Amendment No. 1) for the year ended
June 30, 1997 have been audited by Deloitte & Touche LLP, independent auditors,
as stated in their report, which is incorporated herein by reference, and has
been so incorporated in reliance upon such report given upon the authority of
such firm as experts in accounting and auditing.
12
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
Registration fee............................................ $ 21,415.64
NASD fee.................................................... 3,225.00
NASDAQ listing fees......................................... 17,500.00
Legal fees and expenses..................................... 45,000.00*
Accountants' fees and expenses.............................. 25,000.00*
Placement Agent Reimbursable Expenses....................... 100,000.00*
Miscellaneous............................................... 37,859.36*
------------
Total ................................................ $250,000.00
------------
- ----------
* Estimated
The Company will bear all of the foregoing expenses.
Item 15. Indemnification of Directors and Officers
Section 145 of the General Corporation Law of the State of Delaware
provides that a corporation may indemnify any person who was or is a party to or
is threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative, by
reason of the fact that he is or was a director, officer, employee of another
corporation, partnership, joint venture, trust or other enterprise, against
expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by him in connection with such
actions, suit or proceeding if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
corporation, and, with respect to any criminal action or proceedings, had no
reasonable cause to believe his conduct was unlawful; provided, however, in a
suit by or in the right of the corporation no indemnification shall be made in
respect of any claim, issue or matter as to which such person shall have been
adjudged to be liable to the corporation unless and only to the extent that the
Court of Chancery of the State of Delaware or the court in which such action or
suit was brought has determined upon application that, despite the adjudication
of liability but in view of all of the circumstances of the case, such person is
fairly and reasonably entitled to indemnity or such expenses deemed proper by
the court.
The Company's Certificate of Incorporation provides that the Company will
indemnify its directors and officers (and their heirs, executors and
administrators) against expenses reasonably incurred or imposed upon them in
connection with or arising out of any action, suit or proceeding in which they
may be involved or to which they may be made a party by reason of being or
having been a director or officer of the Company, or, at the Company's request,
any other corporation of which the Company is a stockholder or creditor and from
which they are not entitled to be indemnified, except in respect of matters as
to which they are finally
II-1
<PAGE>
adjudged in such action, suit or proceeding to be liable for negligence or mis-
conduct. In the event of the settlement of any such action, suit or proceeding,
the Company is obligated to provide indemnification only in connection with such
matters covered by the settlement as to which the Company is advised by counsel
that the person to be indemnified did not commit a breach of duty.
The Company's Bylaws provide that the Company will indemnify each person
who is or was a director or officer of the Company, or is or was serving as a
director or officer of another corporation or as a trustee or officer of an
association or trust of which the Company owns stock or shares or of which the
Company is a creditor, against all liabilities and expenses at any time imposed
upon or reasonably incurred by such person in connection with, arising out of or
resulting from any action, suit or proceeding in which such person may be
involved or with which such person may be threatened, by reason of his then
serving or theretofore having served as such director, trustee or officer, or by
reason of any alleged act or omission by him in any such capacity, whether or
not he is serving as such director, trustee or officer at the time any or all of
such liabilities or expenses are imposed upon or incurred by him. The matters
covered by the foregoing indemnity include amounts paid by any such person in
compromise or settlement, if such compromise or settlement is approved as in the
best interests of the Company by vote of a majority of disinterested directors
then in office or by vote of a majority of the shares of stock held by
disinterested stockholders entitled to vote at a meeting called for such
purpose. The foregoing indemnity excludes liabilities or expenses incurred in
connection with any matters as to which the person seeking indemnification is
finally adjudged in such action, suit or proceeding to be liable by reason of
negligence or misconduct in the performance of his duties as such director,
trustee or officer.
Item 16. Exhibits
See Exhibit Index.
Item 17. Undertakings
A. Rule 415
The Company hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this Registration Statement to include any mate-
rial information with respect to the plan of distribution not previously dis-
closed in the Registration Statement or any material change to such information
in the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
II-2
<PAGE>
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the Offering.
B. Incorporation by Reference.
The Company hereby undertakes that, for purposes of determining any
liability under the Securities Act, each filing of the Company's annual report
pursuant to Section 13(a) or Section 15(d) of the Exchange Act that is
incorporated by reference in this Registration Statement shall be deemed to be a
new Registration Statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
C. Indemnification.
Insofar as the indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the Company pursuant to the foregoing provisions, or otherwise, the Company
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Company of expenses
incurred or paid by a director, officer or controlling person of the Company in
the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Company will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
D. Rule 430A
The Company hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act of
1933, the information omitted from the form of Prospectus filed as part of this
Registration Statement in reliance upon Rule 430A and contained in a form of
Prospectus filed by the Company pursuant to Rule 424(b)(1) or (4) or 497(h)
under the Securities Act shall be deemed to be part of this Registration
Statement as of the time it was declared effective.
(2) For purposes of determining any liability under the Securities Act,
each post-effective amendment that contains a form of Prospectus shall be deemed
to be a new Registration Statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
the Company certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned thereunto
duly authorized, in the City of Troy, State of Michigan, on April 22, 1998.
ENERGY CONVERSION DEVICES, INC.
By /s/Stanford R. Ovshinsky
--------------------------------------------
President and Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Roger John Lesinski and Ghazaleh Koefod, and each
of them, as his or her lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him or her and in his or her name, place
and stand, in any and all capacities, to sign any and all amendments (including
post-effective amendments) to this Registration Statement and to file the same,
with all exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto such attorneys-in-fact and
agents, and each of them, full power and authority to do and perform each and
every act and thing requisite and necessary to be done in connection therewith,
as fully to all intents and purposes as he or she might or could do in person,
hereby ratifying and confirming all that such attorneys-in-fact and agents, or
any of them, or their substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons on behalf
of the Company in the capacities and on the dates indicated.
Signature Title Date
- --------- ----- ----
/s/ Stanford R. Ovshinsky Director, President and Chief April 22, 1998
- -------------------------- Executive Officer (principal --------------
Stanford R. Ovshinsky executive officer)
/s/ Stephan W. Zumsteg Treasurer April 22, 1998
- ---------------------- (principal financial officer --------------
Stephan W. Zumsteg and principal accounting
officer)
II-4
<PAGE>
/s/ Robert C. Stempel Chairman of the Board of April 22, 1998
- ---------------------- Directors --------------
Robert C. Stempel
/s/ Iris M. Ovshinsky Director April 22, 1998
- ---------------------- --------------
Iris M. Ovshinsky
/s/ Nancy M. Bacon Director April 22, 1998
- ---------------------- --------------
Nancy M. Bacon
/s/ Umberto Colombo Director April 22, 1998
- ---------------------- --------------
Umberto Colombo
/s/ Hellmut Fritzsche Director April 22, 1998
- ---------------------- --------------
Hellmut Fritzsche
/s/ Joichi Ito Director April 22, 1998
- ---------------------- --------------
Joichi Ito
Director
- ---------------------- --------------
Seymour Liebman
II-5
<PAGE>
Director
- ---------------------------
Walter J. McCarthy, Jr. --------------
/s/ Florence I. Metz Director April 22, 1998
- ---------------------- --------------
Florence I. Metz
Director
- ----------------------
Haru Reischauer ---------------
/s/ Nathan J. Robfogel Director April 22, 1998
- ---------------------- --------------
Nathan J. Robfogel
/s/ Stanley K. Stynes Director April 22, 1998
- ---------------------- --------------
Stanley K. Stynes
II-6
<PAGE>
EXHIBIT INDEX
PAGE OR
EXHIBIT NO. REFERENCE
- ----------- ---------
1.1 Form of Placement Agreement by and among
the Registrant, Janney Montgomery Scott Inc.
and Nolan Securities Corporation
3.1 Restated Certificate of Incorporation filed
September 29, 1967 (a)
3.2 Certificate of Amendment to Certificate of Incorporation
filed September 15, 1978 increasing and extending voting
rights of the Company's Class A Common Stock and
establishing class voting with respect to other matters (b)
3.3 Certificate of Amendment to Certificate of Incorporation
filed January 7, 1982 increasing and extending voting
rights to the Company's Class A Common Stock (c)
3.4 Certificate of Amendment to Certificate of Incorporation
filed September 13, 1993 extending voting rights of the
Company's Class A Common Stock (d)
3.5 Certificate of Amendment to Certificate of Incorporation
filed February 24, 1998 increasing to 20,000,000 the
number of shares of Common Stock, par value one cent
($.01) per share
3.6 Bylaws of the Company in effect as of July 17, 1997 (e)
3.7 Amendment to Article VIII of Bylaws
4.1 Form of Warrant Agreement and Warrant
10.1 Agreement among the Company, Stanford R. Ovshinsky
and Iris M. Ovshinsky, relating to the automatic
conversion of Class A Common Stock into the Company's
Common Stock upon the occurrence of certain events,
dated September 15, 1964 (f)
5.1 Opinion of Jenner & Block
23.1 Consent of Jenner & Block (included in the opinion
filed as Exhibit 5.1)
23.2 Consent of Deloitte & Touche LLP
II-7
<PAGE>
Notes to Exhibit List
---------------------
(a) Filed as Exhibit 2-A to the Company's Form 8-A and incorporated
herein by reference.
(b) Filed as Exhibit 3-A-2 to Post-Effective Amendment No. 1 to the
Company's Registration Statement on Form S-1 (Registration No.
2-61551) and incorporated herein by reference.
(c) Filed as Exhibit 1 to the Company's Quarterly Report on Form 10-Q
for the quarter ended December 31, 1981 and incorporated herein by
reference.
(d) Filed as Exhibit 3.11 to the Company's Annual Report on Form 10-K
for the fiscal year ended June 30, 1993 and incorporated herein by
reference.
(e) Filed as Exhibit 3.10 to the Company's Annual Report on Form 10-K/A
(Amendment No. 1) for the fiscal year ended June 30, 1997 and
incorporated herein by reference.
(f) Filed as Exhibit 13-D to the Company's Registration Statement on
Form S-1 (Registration No. 2-26772) and incorporated herein by
reference.
II-8
EXHIBIT 1.1
JANNEY MONTGOMERY SCOTT INC.
NOLAN SECURITIES CORPORATION
April __, 1998
Energy Conversion Devices, Inc.
1675 West Maple Road
Troy, Michigan 48084
Attention: Stanford R. Ovshinsky
Re: Proposed Limited Public Offering on Form S-3
Ladies and Gentlemen:
We are pleased to confirm the engagement of Janney Montgomery Scott
Inc. ("JMS") and Nolan Securities Corporation ("Nolan") as co-placement agents
on a "best efforts" basis with respect to the proposed limited public offering
(the "Offering") by Energy Conversion Devices, Inc. ("ECD" or the "Company") of
up to 2 million units ("Units") comprised of 2 million shares of the Company's
common stock, $.01 par value (the "Shares") and 2 million warrants to purchase
shares of the Company's common stock $.01 par value (the "Warrants") solely to
persons who are "qualified institutional buyers" as such term is defined in Rule
144A under the Securities Act.
A. REGISTRATION STATEMENT
1. The Units (including the shares of the Company's common stock
issuable upon exercise of the Warrants) will be registered under the Securities
Act of 1933, as amended (the "Securities Act"), and the Rules and Regulations
promulgated thereunder, pursuant to a registration statement on Form S-3
("Registration Statement") or other applicable form, to be prepared and filed by
the Company with the Securities and Exchange Commission (the "Commission").
2. The Registration Statement and any amendment thereto ("Amendment")
or other papers or instruments relating to the proposed Offering shall not be
filed with the Commission unless satisfactory, in form and substance, to JMS and
Nolan and their respective counsel. JMS and Nolan shall be provided with
sufficient copies of the proposed Registration Statement,
1
<PAGE>
related Preliminary and Final Prospectuses and all Exhibits thereto necessary
for their approval prior to filing with the Commission or dissemination to any
party.
B. BEST EFFORTS PLACEMENT; NO MINIMUM AMOUNT OF UNITS TO
BE SOLD
1. JMS and Nolan shall act as co-placement agents on a "best
efforts" basis to sell for the account of the Company up to 2 million Units to
persons who are "qualified institutional buyers" as such term is defined in Rule
144A under the Securities Act. No minimum number of Units is required to be sold
pursuant to the Offering for the closing to take place.
2. For acting as placement agents, JMS and Nolan shall receive a fee
equal to six percent (6%) of the gross proceeds of the Units sold, payable to
the order of JMS. In addition, as set forth in greater detail below, JMS and
Nolan shall receive reimbursement of expenses and JMS shall receive warrants, at
$.01 per warrant, to purchase units identical to the Units. The fee provided for
herein will not apply to any proceeds received by the Company from exercise of
the Warrants.
C. PRICING
The offering price of the Units (the "Per Unit Offering Price")
shall be determined by negotiation by and among the Company, JMS, Nolan and the
purchasers of the Units based on the closing bid price of the Company's common
stock on the Nasdaq National Market on the closing date of the Offering (the
"Closing Date").
D. WARRANTS.
The Warrants shall entitle the holders to purchase shares of the
Company's common stock at an exercise price per share equal to 135% of the Per
Unit Offering Price on or prior to January 31, 2000, and at an exercise price
per share equal to 155% of the Per Unit Offering Price at any time thereafter
and until expiration of the Warrants on July 31, 2001.
E. EXPENSES OF THE OFFERING
1. Irrespective of whether the Offering is consummated, the Company
shall be responsible for and pay all reasonable expenses directly and
necessarily incurred in connection with the offering, including, without
limitation:
2
<PAGE>
(a) the fees, costs and expenses of the Company's accountants and
attorneys;
(b) the costs of preparing, delivering and filing with the Commission
the Registration Statement, Preliminary and Final Prospectuses,
Exhibits and related documents and all amendments and supplements
thereto; and the costs of delivering all such documents to JMS and
Nolan in such reasonable quantities as they may request;
(c) the cost of preparing and delivering certificates representing the
Units;
(d) the cost and expenses, including legal fees, of registering or
qualifying the Units for offer and sale under the securities or Blue
Sky laws of the various states in which JMS and Nolan intend to
offer and sell the Units;
(e) NASD filing fees, if any;
(f) the fees and expenses of the Transfer Agent and Registrar of the
Company's common stock;
(g) the fees and expenses of the Warrant Agent for the Warrants;
(h) the reasonable fees and expenses of legal counsel to JMS and Nolan
incurred in connection with the Offering;
(i) the Company's own expenses for roadshows and tombstone advertising
expenses; and
(j) any other usual and customary expenses in connection with the
foregoing.
The expenses of JMS and Nolan will be billed on a monthly
basis and the Company's reimbursement obligation for such expenses shall not
exceed an aggregate of $100,000, inclusive of legal fees. JMS acknowledges
receipt of an advance against expenses in the amount of $25,000.
F. JMS AND NOLAN WARRANTS; REGISTRATION RIGHTS
At the Closing Date, the Company will issue to JMS and Nolan,
or their designees, warrants (the "Placement Agent Warrants") to purchase units
identical to the Units in an amount equal to four percent (4%) of
3
<PAGE>
the Units sold in the Offering. The Placement Agent Warrants shall expire five
(5) years from the Closing Date and shall be exercisable commencing one year
from the Closing Date, from time to time, in whole or in part, prior to the
expiration date at an exercise price per unit equal to one hundred thirty
percent (130%) of the Per Unit Offering Price.
At the written request of JMS at any time during the four-year
exercisable period, the Company, on one occasion, shall promptly prepare and
file with the Commission a registration statement (or post-effective amendment
to the Registration Statement) and such other documents as, in the opinion of
counsel to the Company and counsel to JMS, shall be required to permit a public
offering of the securities issuable upon exercise of the Placement Agent
Warrants and shall use its reasonable best efforts to cause such registration
statement to be declared effective as promptly as possible. Notwithstanding the
foregoing, ECD may postpone for up to 90 days the filing or the effectiveness of
a registration statement for a demand registration if ECD determines that such
demand registration would reasonably be expected to have an adverse effect on
any proposal or plan by ECD or any of its subsidiaries to engage in any
acquisition or disposition of assets (other than in the ordinary course of
business), merger, consolidation, tender offer, joint venture, license
arrangement or similar transaction. The Company shall pay the initial $15,000 of
the related fees and expenses, other than the fees and expenses of counsel to
JMS and any underwriting or selling commissions, and JMS shall pay the excess,
if any, of such fees and expenses.
After the Closing Date, in the event the Company determines to
register any of its securities pursuant to a registration statement filed with
the Commission other than on Form S-4 or Form S-8, the Company will so notify
JMS and Nolan in writing and JMS and Nolan shall have the right, exercisable
within 30 days after such written notice, to request that the securities
issuable upon exercise of the Placement Agent Warrants be included in such
registration statement, which the Company shall so include; provided, however,
that if the managing underwriters of an underwritten public offering advise the
Company that in their opinion the securities requested for inclusion by JMS
and/or Nolan could not be sold in an orderly manner in such underwritten
offering within a price range acceptable to the Company, then the holders of the
Placement Agent Warrants shall agree, at the request of such managing
underwriters, not to offer for sale, sell or otherwise dispose of the securities
so registered for a period beginning seven days prior to and ending 90 days
after the effective date of the underwritten offering.
The Company shall indemnify and hold harmless the holders of the
Placement Agent Warrants whose securities are included in a registration
statement filed pursuant to this Section to the identical extent as JMS and
4
<PAGE>
Nolan are indemnified under Section G hereunder and the Company shall provide
such holders with a written agreement to such effect upon request.
G. INDEMNIFICATION
The Company agrees to indemnify and hold harmless JMS and/or Nolan
and each person, if any, who controls JMS and/or Nolan within the meaning of
either Section 15 of the Securities Act or Section 20 of the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), from and against any and all
losses, claims, damages and liabilities (including, without limitation, any
legal or other expenses reasonably incurred by JMS and/or Nolan or any such
controlling person in connection with defending or investigating any such action
or claim) caused by any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or any amendment thereof,
any preliminary or final prospectus (as amended or supplemented if the Company
shall have furnished any amendments or supplements thereto), or caused by 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 such losses, claims, damages or liabilities are caused by any
such untrue statement or omission or alleged untrue statement or omission based
upon information relating to JMS and/or Nolan and furnished to the Company in
writing by JMS and/or Nolan expressly for use therein.
JMS and Nolan agree to indemnify and hold harmless the Company, its
directors, its officers who sign the Registration Statement and each person, if
any, who controls the Company within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act to the same extent as the
foregoing indemnity from the Company to JMS and Nolan, but only with reference
to the failure of JMS or Nolan to comply with the prospectus delivery
requirements of the federal securities laws in connection with the Offering and
sale of the Units or to information relating to JMS and/or Nolan furnished to
the Company in writing by JMS and/or Nolan, as the case may be, expressly for
use in the Registration Statement, any preliminary or final prospectus, or any
amendments or supplements thereto.
In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may be
sought pursuant to the preceding two paragraphs, such person (the "indemnified
party") shall promptly notify the person against whom such indemnity may be
sought (the "indemnifying party") in writing and the indemnifying party, upon
request of the indemnified party, shall retain counsel reasonably satisfactory
to the indemnified party to represent the indemnified party and any others the
indemnifying party may designate in such proceeding and shall pay the fees
5
<PAGE>
and disbursements of such counsel related to such proceeding. In any such
proceeding, the indemnifying party may assume the defense of any action the
subject of the first sentence of this paragraph with counsel reasonably
satisfactory to the indemnified party. In addition, any indemnified party shall
have the right to retain its own counsel, but the fees and expenses of such
counsel shall be at the expense of such indemnified party unless (i) the
indemnifying party and the indemnified party shall have mutually agreed to the
retention of such counsel or (ii) the named parties to any such proceeding
(including any impleaded parties) include both the indemnifying party and the
indemnified party and representation of both parties by the same counsel would
be inappropriate due to actual or potential differing interests between them. It
is understood that the indemnifying party shall not, in respect of the legal
expenses of any indemnified party in connection with any proceeding or related
proceedings in the same jurisdiction, be liable for the fees and expenses of
more than one separate firm (in addition to any local counsel) for all such
indemnified parties and that all such fees and expenses shall be reimbursed as
they are incurred. The indemnifying party shall not be liable for any settlement
of any proceeding effected without its written consent, but if settled with such
consent or if there be a final judgment for the plaintiff not subject to any
appeals, the indemnifying party agrees to indemnify the indemnified party from
and against any loss or liability by reason of such settlement or judgment. No
indemnifying party shall, without the prior written consent of the indemnified
party (which shall not be unreasonably withheld or delayed), effect any
settlement of any pending or threatened proceeding in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability on claims
that are the subject matter of such proceeding.
If the indemnification provided for in the first or second paragraph
of this Section G is unavailable to an indemnified party, then each indemnifying
party under such paragraph, in lieu of indemnifying such indemnified party
thereunder, shall contribute to the amount paid or payable by such indemnified
party as a result of such losses, claims, damages or liabilities (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company on the one hand and JMS and/or Nolan on the other hand from the offering
of the Units or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but also the relative
fault of the Company on the one hand and of JMS and/or Nolan on the other hand
in connection with the statements or omissions that resulted in such losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand
and JMS and/or Nolan on the other hand in connection with the offering of the
6
<PAGE>
Units shall be deemed to be in the same respective proportions as the net
proceeds from the offering of the Units (before deducting expenses) received by
the Company and the fee paid to JMS and Nolan bear to the aggregate offering
price of the Units. The relative fault of the Company on the one hand and JMS
and/or Nolan on the other hand shall be determined by references to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company or by JMS and/or Nolan and the parties' relative intent,
knowledge, access to information supplied by the Company or by JMS and/or Nolan
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
The Company, JMS and Nolan agree that it would not be just or
equitable if contribution pursuant to this Section G were determined by pro rata
allocation or by any other method of allocation that does not take account of
the equitable considerations referred to in the immediately preceding paragraph.
The amount paid or payable by an indemnified party as a result of the losses,
claims, damages and liabilities referred to in the immediately preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses reasonably incurred by such indemnified party
in connection with investigating or defending such action or claim.
Notwithstanding the provisions of this Section G, JMS and/or Nolan shall not be
required to contribute any amount in excess of the aggregate fee paid to JMS and
Nolan by the Company. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The remedies provided for in this Section G are not exclusive
and shall not limit any rights or remedies which may otherwise be available to
any indemnified party at law or in equity.
The indemnity and contribution provisions contained in this Section
G shall remain operative and in full force and effect regardless of any
termination of this Agreement.
H. DISSEMINATION OF INFORMATION
During the pendency of the Offering, the Company agrees and
undertakes to consult with JMS and Nolan prior to distribution to third parties
of any financial information, news releases and/or other publicity regarding the
Company, its business or any terms of the Offering. Copies of all documents
7
<PAGE>
which the Company or its public relations advisors intend to distribute during
the pendency of the Offering will be provided to JMS and Nolan for review prior
to such distribution.
I. TERMINATION OF PLACEMENT
In the event that the proposed Offering is, for any reason,
terminated prior to the effective date of the Registration Statement, the
Company agrees, acknowledges and undertakes to remain responsible for payment of
all expenses as provided in Section E above.
J. DUE DILIGENCE INVESTIGATION
1. The Company shall supply and deliver to JMS and Nolan and their
respective legal counsel at their respective offices, all information required
to enable them to make such investigation of the Company and its business
prospects as they shall desire and shall make available to them such persons as
they deem reasonably necessary or appropriate in order to verify or substantiate
any information regarding the Company.
2. It is expressly understood and agreed that JMS, Nolan and their
respective legal counsel will be undertaking a thorough review of all the
Company's contractual commitments and operational practices and in the event
that these do not meet with the approval of JMS and/or Nolan, JMS and Nolan will
not proceed with the Offering. JMS and Nolan agree to hold in confidence and not
disclose confidential information of ECD or its affiliates to any person or
entity without the prior written consent of ECD. For purposes of this Agreement,
confidential information does not include: matters of public knowledge;
information rightfully received by JMS and/or Nolan from a third party without a
duty of confidentiality to ECD; information independently developed by JMS or
Nolan; or information required by law to be disclosed (provided that JMS and
Nolan will give ECD prior written notice of any disclosure so required).
K. REPRESENTATIONS, WARRANTIES AND COVENANTS
The Company hereby represents and warrants to, and covenants with,
JMS and Nolan as follows:
1. The Company will not issue any Units until the Registration
Statement has been declared effective and no stop order suspending the
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effectiveness of the Registration Statement shall be in effect, and no
proceedings for such purpose shall be pending before or, to ECD's knowledge,
threatened by the Commission at the time the Units are issued.
2. (i) As of the date that the Units are issued, each part of the
Registration Statement, when such part became effective, will not contain and
each such part, as amended and supplemented, if applicable, will not contain any
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not misleading,
(ii) the Registration Statement and the prospectus, as amended and supplemented,
if applicable, will comply in all material respects with the Securities Act and
the applicable rules and regulations of the Commission thereunder and (iii) the
prospectus, as amended and supplemented, if applicable, will not contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements therein, in light of the circumstances under which they
were made, not misleading.
3. The Company has been duly incorporated, is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to own its property and to
conduct its business as described in the Registration Statement and is duly
qualified to transact business and is in good standing in each jurisdiction in
which the conduct of its business or its ownership or leasing of property
requires such qualification, except to the extent that the failure to be so
qualified or be in good standing would not have a material adverse effect on the
Company.
4. The authorized capital stock of the Company conforms as to legal
matters to the description thereof contained in the Registration Statement.
5. The shares of common stock of ECD outstanding prior to the Offering
have been duly authorized and are validly issued, fully paid and non-assessable.
The Units, when issued and delivered as contemplated by this Agreement, will be
validly issued, fully paid and non-assessable and the issuance of such Units
will not be subject to any preemptive or similar right.
6. This Agreement has been duly authorized, executed and delivered by
ECD.
7. ECD shall keep effective the registration under the Securities Act
of the Company's common stock issuable upon exercise of the Warrants in order
that the holders of Warrants shall, upon exercise of the Warrants, receive
shares fully registered under the Securities Act upon exercise of the Warrants.
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8. The execution and delivery by ECD of, the performance of its
obligations under, and the consummation of the transactions contemplated by,
this Agreement will not contravene any provision of (i) the certificate or
articles of incorporation or by-laws of ECD or (ii) applicable law, rule or
regulation or any agreement or other instrument binding upon ECD, or any
judgment, order or decree of any governmental body or agency or court having
jurisdiction over ECD, and all consents, approvals, authorizations,
registrations, filings or qualifications of or with any court or governmental
body or agency of the United States or any state thereof required for the
execution and delivery by ECD of, the performance by ECD of its obligations
under, and the consummation by ECD of the transactions contemplated by, this
Agreement have been or will be obtained or made and are or will be in full force
and effect, except as may be required by state securities or Blue Sky laws in
connection with the offer and sale of the Units.
9. Each preliminary prospectus filed as part of the Registration
Statement or any amendment thereto, or filed pursuant to Rule 424 under the
Securities Act, will comply in all material respects with Securities Act and the
rules and regulations of the Commission thereunder.
10. No person is or will be entitled, directly or indirectly, to
compensation from the Company or any of its affiliate for services as a finder
in connection with the Offering.
11. JMS and Nolan shall have received such additional documents,
certificates, opinions of counsel and other deliveries as it may reasonably
request and as are customary to effect a closing of the matters herein
contemplated.
L. TERM OF AGREEMENT
This Agreement shall terminate: (i) at any time upon the mutual
agreement of the parties; (ii) upon notice given by ECD, JMS or Nolan, as the
case may be, if any party material breaches any of the provisions hereof; (iii)
upon notice given by ECD to JMS and Nolan, if ECD determines for any reason not
to consummate this Offering on the terms and conditions specified in this
Agreement and in the prospectus; provided, however, that if ECD terminates this
Agreement pursuant to the immediately preceding clause (iii), ECD shall pay to
JMS and Nolan a pro rata amount of the fee specified in Section B if, during the
first twelve (12) months following the date of such termination, ECD issues any
securities on a private- placement basis to any investor previously contacted by
either JMS or Nolan in connection with this Offering, (the
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"Investors"). For purposes of this provision, JMS and Nolan shall provide ECD
with a list of all such Investors. .
During the first twenty four (24) months following the date of the Closing
of the Offering, if a purchaser of Units in the Offering acquires any additional
securities of ECD on a private placement basis from ECD, and JMS and Nolan are
not designated as ECD's agent for such placement or are designated on an
unreasonable or unacceptable basis, ECD shall pay to JMS and Nolan a cash fee
equal to 3% of the gross proceeds raised thereby.
M. LAWS AND JURISDICTION TO GOVERN
This Agreement shall be construed and enforced in accordance with
the laws of the State of New York and the parties agree to submit themselves to
the jurisdiction of the courts of the State of New York which shall be the sole
tribunal in which any parties may institute and maintain a legal proceeding
against the other party arising from any dispute in this Agreement. In the event
any party initiates a legal proceeding in a jurisdiction other than in the
courts of the State of New York, the other party may assert as a complete
defense and as a basis for dismissal of such legal proceeding that the legal
proceeding was not initiated and maintained in the courts of the State of New
York in accordance with the provisions of this Section M.
N. MISCELLANEOUS
The letter dated April 17, 1998 by JMS to ECD relating to
arrangements set forth herein shall terminate upon execution of this agreement,
except that the indemnification provisions contained therein shall remain
operative and full force and effect with respect to acts occurring prior to the
date of this Agreement. The provisions of Section G shall apply with respect to
acts occurring on and after the date of this Agreement.
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If the foregoing is acceptable to you, please sign and return two
copies of this letter, retaining the original and one copy for your records.
Very truly yours,
JANNEY MONTGOMERY SCOTT INC.
By: ______________________________
Name:
Title:
NOLAN SECURITIES CORPORATION
By: ______________________________
Name:
Title:
Accepted and Agreed:
ENERGY CONVERSION DEVICES, INC.
By: ________________________________
Stanford R. Ovshinsky
President
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EXHIBIT 3.5
CERTIFICATE OF AMENDMENT
TO
CERTIFICATE OF INCORPORATION
OF
ENERGY CONVERSION DEVICES, INC.
ENERGY CONVERSION DEVICES, INC., a corporation organized and existing
under and by virtue of the General Corporation Law of the State of Delaware (the
"Corporation"), does hereby certify:
FIRST: The following amendment to the Certificate of Incorporation of
said Corporation was duly adopted in accordance with the provisions of Section
242, Title 8, Chapter 1, Delaware Code;
The first sentence of Article Fourth is to be modified to read as
follows:
"FOURTH: The total number of shares of all classes of stock which
the Corporation shall have authority to issue is 20,500,000 shares,
of which 500,000 shares shall be Class A Common Stock of a par
value of one cent ($.01) per share and 20,000,000 shares shall be
Common Stock of a par value of one cent ($.01) per share."
SECOND: That the capital of the Corporation will not be reduced under,
or by reason of, same amendment.
IN WITNESS WHEREOF, the Corporation has caused this amendment to be
signed by its President and its corporate seal to be hereunto affixed by its
Secretary this 19th day of February, 1998.
ENERGY CONVERSION DEVICES, INC.
/s/ Stanford R. Ovshinsky
----------------------------
By: Stanford R. Ovshinsky
Its: President and Chief
Executive Officer
ATTEST:
/s/ Ghazaleh Koefod
- ---------------------------
Ghazaleh Koefod, Secretary
EXHIBIT 3.7
Amendment to Article VIII of the Bylaws
of Energy Conversion Devices, Inc.
The first sentence of the fourth paragraph of Article VIII of the Bylaws
is amended, effective as of February 19, 1998 as follows:
The total number of directors shall consist
of not less than three nor more than thirteen
directors.
EXHIBIT 4.1
WARRANT AGREEMENT
AGREEMENT, dated as of this ___ day of April, 1998, by and between
ENERGY CONVERSION DEVICES, INC., a Delaware corporation (the "Company"), and
STATE STREET BANK AND TRUST COMPANY, as warrant agent (the "Warrant Agent").
W I T N E S S E T H
WHEREAS, the Company proposes to make a public offering (the "Public
Offering") of units (the "Units"), each Unit consisting of one share of Common
Stock (as defined in Section 1 hereof) and one warrant (the "Warrants") of the
Company to purchase one share of Common Stock; and
WHEREAS, in relation to the Public Offering, the Company has filed a
registration statement on Form S-3 (Registration No. 333-_____) (as amended or
supplemented, the "Registration Statement") and a related prospectus (as amended
or supplemented, the "Prospectus") with the Securities and Exchange Commission;
and
WHEREAS, the Company desires the Warrant Agent to act on behalf of
the Company, and the Warrant Agent is willing so to act, in connection with the
issuance, registration, transfer, exchange and redemption of the Warrants, the
issuance of certificates representing the Warrants, the exercise of the
Warrants, and the rights of the registered holders thereof (the "Registered
Holders");
NOW, THEREFORE, in consideration of the premises and the mutual
agreements hereinafter set forth and for the purpose of defining the terms and
provisions of the Warrants and the certificates representing the Warrants and
the respective rights and obligations thereunder of the Company, the Registered
Holders and the Warrant Agent, the parties hereto hereby agree as follows:
SECTION 1. Definitions. As used herein, the following terms shall
have the following meanings, unless the context shall otherwise require:
(a) "Common Stock" shall mean the common stock, par value $.01 per
share, of the Company.
(b) "Corporate Office" shall mean the office of the Warrant Agent
(or its successor) at which at any particular time its principal business shall
be administered, which office is located at
__________________________________________ as of the date hereof.
(c) "Exercise Date" shall mean, as to any Warrant, the date on which
the Warrant Agent shall have received both (a) the Warrant Certificate
representing such Warrant, with the exercise form thereon duly executed by the
Registered Holder thereof or his attorney duly authorized in writing, with the
appropriate signature guarantees, as described in the Warrant Certificate, and
(b) payment in cash, or by official bank or certified check made
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payable to the Company, of an amount in lawful money of the United States of
America equal to the Exercise Price plus transfer taxes, if any.
(d) "Exercise Price" shall mean the purchase price to be paid upon
exercise of the Warrants (each Warrant exercisable to purchase one share of
Common Stock) in accordance with the terms hereof, which price shall be $____
per share (equal to 135% of the offering price of the Units) on or prior to
January 31, 2000, and $____ per share (155% of the offering price of the Units)
on or prior to July 31, 2001, the Warrant Expiration Date (defined below),
subject to adjustment from time to time pursuant to the provisions of Section 8
hereof.
(e) "Registered Holder" shall mean the person in whose name any
certificate representing Warrants shall be registered on the books maintained by
the Warrant Agent pursuant to Section 6 hereof.
(f) "Transfer Agent" shall mean State Street Bank and Trust Company,
as the Company's transfer agent, or its authorized successor, as such.
(g) "Warrant Expiration Date" shall mean 5:00 P.M. (New York City
time) on July 31, 2001, provided that, if in the State of New York, such date
shall be a holiday or a day on which banks are authorized to close, then 5:00
P.M. (New York City time) on the next following day which in the State of New
York is not a holiday or a day on which banks are authorized to close.
SECTION 2. Warrants and Issuance of Warrant Certificates.
(a) A Warrant shall initially entitle the Registered Holder of the
Warrant Certificate representing such Warrant to purchase one share of Common
Stock upon the exercise thereof, in accordance with the terms hereof, subject to
modification and adjustment as provided in Section 8 hereof.
(b) From time to time, up to the Warrant Expiration Date, the
Transfer Agent shall execute and deliver stock certificates in required whole
number denominations representing up to an aggregate of 2,000,000 shares of
Common Stock, subject to adjustment as described herein, upon the exercise of
Warrants in accordance with this Agreement.
(c) From time to time, up to the Warrant Expiration Date, the
Warrant Agent shall execute and deliver Warrant Certificates in required whole
number denominations to the persons entitled thereto in connection with any
transfer or exchange permitted under this Agreement; provided that no Warrant
Certificates shall be issued except (i) those initially issued hereunder; (ii)
those issued upon the exercise of fewer than all Warrants represented by any
Warrant Certificate, to evidence any unexercised Warrants held by the exercising
Registered Holder; (iii) those issued upon any transfer or exchange pursuant to
Section 6 hereof; (iv) those issued in replacement of lost, stolen, destroyed or
mutilated Warrant Certificates pursuant to Section 7 hereof; and (v) at the
option of the Company, in such form as may be approved by its Board of
Directors, to reflect (a) any adjustment or change in the
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number of shares of Common Stock purchasable upon exercise of the Warrants made
pursuant to Section 8 hereof and (b) other modifications approved by Registered
Holders in accordance with Section 15 hereof.
SECTION 3. Form and Execution of Warrant Certificates.
(a) The Warrant Certificates shall be substantially in the form
annexed hereto as Exhibit A (the provisions of which are hereby incorporated
herein) and may have such letters, numbers or other marks of identification or
designation and such legends, summaries or endorsements printed, lithographed,
engraved or typed thereon as the Company may deem appropriate and as are not
inconsistent with the provisions of this Agreement, or as may be required to
comply with any law or with any rule or regulation made pursuant thereto or with
any rule or regulation of any stock exchange or securities association on which
or through which the Warrants may be listed, or to conform to usage. The Warrant
Certificates shall be dated the date of issuance thereof (whether upon initial
issuance, transfer, exchange or in lieu of mutilated, lost, stolen, or destroyed
Warrant Certificates) and issued in registered form.
Warrants shall be numbered serially with the letter W.
(b) Warrant Certificates shall be executed on behalf of the Company
by its Chairman of the Board, President or any Vice President and by its
Secretary or an Assistant Secretary, by manual signatures or by facsimile
signatures printed thereon, shall have imprinted thereon a facsimile of the
Company's seal and shall be countersigned by an authorized signatory of the
Warrant Agent. In case any officer of the Company who shall have signed any of
the Warrant Certificates shall cease to be such officer of the Company before
the date of issuance of the Warrant Certificates and issue and delivery thereof,
such Warrant Certificates may nevertheless be issued and delivered with the same
force and effect as though the person who signed such Warrant Certificates had
not ceased to be such officer of the Company. After execution by the Company,
Warrant Certificates shall be delivered by the Warrant Agent to the Registered
Holders.
SECTION 4. Exercise. Each Warrant may be exercised by the Registered
Holder thereof at any time after the effective date of the Registration
Statement and until the Warrant Expiration Date, upon the terms and subject to
the conditions set forth herein and in the applicable Warrant Certificate. A
Warrant shall be deemed to have been exercised immediately prior to the close of
business on the Exercise Date and the person entitled to receive the securities
deliverable upon such exercise shall be treated for all purposes as the holder
of such securities upon exercise of the Warrant Certificate as of the close of
business on the Exercise Date. As soon as practicable on or after the Exercise
Date, the Warrant Agent shall deposit the proceeds received from the exercise of
a Warrant, and promptly after clearance of checks received in payment of the
Exercise Price pursuant to such Warrants, cause to be issued and delivered by
the Transfer Agent, to the person or persons entitled to receive the same, a
certificate or certificates for the securities deliverable upon such exercise
(plus a certificate for any remaining unexercised Warrants of the Registered
Holder, if applicable). Notwithstanding the foregoing, in the case of payment
made in the form of a check drawn on an account of such investment banks and
brokerage houses as the Company
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shall approve, certificates shall immediately be issued without any delay. Upon
the exercise of any Warrant and clearance of the funds received, the Warrant
Agent shall promptly remit the payment received for the Warrant to the Company
or as the Company may direct in writing.
SECTION 5. Reservation of Shares; Listing; Payment of Taxes; etc.
(a) The Company covenants that it will at all times reserve and keep
available out of its authorized Common Stock, solely for the purpose of issuance
upon exercise of Warrants, such number of shares of Common Stock as shall then
be issuable upon the exercise of all outstanding Warrants. The Company covenants
that all shares of Common Stock which shall be issuable upon exercise of the
Warrants and payment of the Exercise Price in compliance with this Warrant
Agreement and the Warrant Certificate shall, at the time of delivery, be duly
and validly issued, fully paid, nonassessable and free from all taxes, liens and
charges with respect to the issue thereof (other than those which the Company
shall promptly pay or discharge).
(b) The Company will use reasonable efforts to obtain appropriate
approvals or registrations under state "blue sky" securities laws with respect
to the exercise of the Warrants; provided, however, that the Company shall not
be obligated to file any general consent to service of process, consent to
taxation or qualify as a foreign corporation in any jurisdiction. With respect
to any such securities laws, however, Warrants may not be exercised by, or
shares of Common Stock issued to, any Registered Holder in any state in which
such exercise would be unlawful.
(c) The Company shall pay all documentary, stamp or similar taxes
and other governmental charges that may be imposed with respect to the issuance
of Warrants, or the issuance or delivery of any shares upon exercise of the
Warrants; provided, however, that, if shares of Common Stock are to be delivered
in a name other than the name of the Registered Holder of the Warrant
Certificate representing any Warrant being exercised, then no such delivery
shall be made unless the person requesting the same has paid to the Warrant
Agent the amount of transfer taxes or charges incident thereto, if any.
(d) The Warrant Agent is hereby irrevocably authorized to
requisition the Transfer Agent from time to time for certificates representing
shares of Common Stock required to be issued upon exercise of the Warrants, and
the Company will authorize the Transfer Agent to comply with all such proper
requisitions.
SECTION 6. Exchange and Registration of Transfer.
Subject to the restrictions on transfer contained in the Warrant
Certificates:
(a) Warrant Certificates may be exchanged for other Warrant
Certificates representing an equal aggregate number of Warrants or may be
transferred in whole or in part. Warrant Certificates to be exchanged shall be
surrendered to the Warrant Agent at its
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Corporate Office, and upon satisfaction of the terms and provisions herein, the
Company shall execute, and the Warrant Agent shall countersign, issue and
deliver in exchange therefor, the Warrant Certificate or Certificates which the
Registered Holder making the exchange shall be entitled to receive.
(b) The Warrant Agent shall keep books at its office, in which it
shall register Warrant Certificates and the transfer thereof in accordance with
its regular practice. Upon due presentment for registration of transfer of any
Warrant Certificate at its office, the Company shall execute and the Warrant
Agent shall issue and deliver to the transferee or transferees a new Warrant
Certificate or Certificates representing an equal aggregate number of Warrants.
(c) With respect to all Warrant Certificates presented for
registration of transfer, or for exchange or exercise, the exercise form on the
reverse thereof shall be duly endorsed, or be accompanied by a written
instrument or instruments of transfer and exercise, in form satisfactory to the
Company, duly executed by the Registered Holder or his attorney-in-fact duly
authorized in writing.
(d) A service charge may be imposed by the Warrant Agent upon the
Registered Holder for any exchange or registration of transfer of Warrant
Certificates. The Company may require payment by a Registered Holder of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection therewith.
(e) Prior to due presentment for registration of transfer thereof,
the Company and the Warrant Agent may deem and treat the Registered Holder of
any Warrant Certificate
as the absolute owner thereof and of each Warrant represented thereby
(notwithstanding any notations of ownership or writing thereon made by anyone
other than a duly authorized officer of the Company or the Warrant Agent) for
all purposes and shall not be affected by any notice to the contrary. The
Warrants, which the Company intends to publicly offer with the Common Stock,
will be separately transferable immediately following the completion of the
Public Offering.
SECTION 7. Loss or Mutilation. Upon receipt by the Company and the
Warrant Agent of evidence satisfactory to them of the ownership and loss, theft,
destruction or mutilation of any Warrant Certificate and (in case of loss, theft
or destruction) of indemnity satisfactory to them, and (in the case of
mutilation) upon surrender and cancellation thereof, the Company shall execute
and the Warrant Agent shall (in the absence of notice to the Company and/or
Warrant Agent that the Warrant Certificate has been acquired by a bona fide
purchaser) countersign and deliver to the Registered Holder in lieu thereof a
new Warrant Certificate of like tenor representing an equal aggregate number of
Warrants. Registered Holders requesting a substitute Warrant Certificate will be
required to comply with such other reasonable regulations and pay such other
reasonable charges as the Warrant Agent may prescribe.
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SECTION 8. Adjustment of Exercise Price and Number of Shares of
Common Stock or Warrants.
(a) Subject to the exceptions referred to in Section 8(g) below, in
the event the Company shall, at any time or from time to time after the date
hereof, issue any shares of Common Stock as a stock dividend to the holders of
Common Stock, or subdivide or combine the outstanding shares of Common Stock
into a greater or lesser number of shares (any such sale, issuance, subdivision
or combination being herein called a "Change of Shares"), then, and thereafter
upon each Change of Shares, the Exercise Price in effect immediately prior to
such Change of Shares shall be changed to a price (including any applicable
fraction of a cent) determined by multiplying the Exercise Price in effect
immediately prior thereto by a fraction, the numerator of which shall be the
number of shares of Common Stock outstanding immediately prior to such Change of
Shares and the denominator of which shall be the sum of the number of shares of
Common Stock outstanding immediately after such Change of Shares. Such
adjustment shall be made successively whenever such Change of Shares occurs.
Upon each adjustment of the Exercise Price pursuant to this Section
8, the total number of shares of Common Stock purchasable upon the exercise of
each Warrant shall (subject to the provisions contained in Section 8(b) hereof)
be such number of shares (calculated to the nearest tenth) purchasable at the
Exercise Price immediately prior to such adjustment multiplied by a fraction,
the numerator of which shall be the Exercise Price in effect immediately prior
to such adjustment and the denominator of which shall be the Exercise Price in
effect immediately after such adjustment.
(b) The Company may elect upon any adjustment of the Exercise Price
hereunder, to adjust the number of Warrants outstanding, in lieu of the
adjustment in the number of shares of Common Stock purchasable upon the exercise
of each Warrant as hereinabove provided, so that each Warrant outstanding after
such adjustment shall represent the right to purchase one share of Common Stock.
Each Warrant held of record prior to such adjustment of the number of Warrants
shall become that number of Warrants (calculated to the nearest tenth)
determined by multiplying the number one by a fraction, the numerator of which
shall be the Exercise Price in effect immediately prior to such adjustment and
the denominator of which shall be the Exercise Price in effect immediately after
such adjustment. Upon each adjustment of the number of Warrants pursuant to this
Section 8, the Company shall, as promptly as practicable, cause to be
distributed to each Registered Holder of Warrant Certificates, on the date of
such adjustment, Warrant Certificates evidencing, subject to Section 10 hereof,
the number of additional Warrants to which such Holder shall be entitled as a
result of such adjustment or, at the option of the Company, cause to be
distributed to such Holder in substitution and replacement for the Warrant
Certificates held by him prior to the date of adjustment (and upon surrender
thereof, if required by the Company) new Warrant Certificates evidencing the
number of Warrants to which such Holder shall be entitled after such adjustment.
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(c) In case of any reclassification, capital reorganization or other
similar change of outstanding shares of Common Stock, or in case of any
consolidation or merger of the Company with or into another corporation (other
than a consolidation or merger in which the Company is the continuing
corporation and which does not result in any reclassification, capital
reorganization or other change of outstanding shares of Common Stock), or in
case of any sale or conveyance to another corporation of the property of the
Company as, or substantially as, an entirety (other than a sale/leaseback,
mortgage or other financing transaction), the Company shall cause effective
provision to be made so that each holder of a Warrant then outstanding shall
have the right thereafter, by exercising such Warrant, to purchase the kind and
number of shares of stock or other securities or property (including cash)
receivable upon such reclassification, capital reorganization or other change,
consolidation, merger, sale or conveyance by a holder of the number of shares of
Common Stock that might have been purchased upon exercise of such Warrant
immediately prior to such reclassification, capital reorganization or other
similar change, consolidation, merger, sale or conveyance. Any such provision
shall include provision for adjustments that shall be as nearly equivalent as
may be practicable to the adjustments provided for in this Section 8. The
foregoing provisions shall similarly apply to successive reclassifications,
capital reorganizations and other changes of outstanding shares of Common Stock
and to successive consolidations, mergers, sales or conveyances. Neither the
authorization or issuance by the
Company of additional shares of its Common Stock, Class A Common Stock, par
value $.01 per share, or any new class of capital stock, nor the modification of
the voting rights attributable thereto, shall be deemed to constitute a
reclassification, capital reorganization or other similar change of the
outstanding shares of the Common Stock for purposes of this Section 8.
(d) Irrespective of any adjustments or changes in the Exercise Price
or the number of shares of Common Stock purchasable upon exercise of the
Warrants, the Warrant Certificates theretofore issued, unless the Company shall
exercise its option to issue new Warrant Certificates pursuant to Section 2(c)
hereof, need not be amended or replaced, but certificates thereafter issued
shall bear an appropriate legend or other notice of any adjustments.
(e) After each adjustment of the Exercise Price pursuant to this
Section 8, the Company will promptly prepare a certificate signed by the
Chairman or President, the Secretary or an Assistant Secretary, of the Company
setting forth: (i) the Exercise Price as so adjusted, (ii) the number of shares
of Common Stock purchasable upon exercise of each Warrant after such adjustment,
and, if the Company shall have elected to adjust the number of Warrants, the
number of Warrants to which the Registered Holder of each Warrant shall then be
entitled, and (iii) a brief statement of the facts accounting for such
adjustment. The Company will promptly file such certificate with the Warrant
Agent and cause a brief summary thereof to be sent by ordinary first class mail
to each Registered Holder at his last address as it shall appear on the registry
books of the Warrant Agent. The affidavit of an officer of the Warrant Agent or
the Secretary or an Assistant Secretary of the Company that such notice has been
mailed shall, in the absence of fraud, be prima facie evidence of the facts
stated therein.
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(f) For purposes of Section 8(a) and 8(b) hereof, the following
provisions (A) and (B) shall also be applicable:
(A) The number of shares of Common Stock outstanding at any
given time shall include shares of Common Stock owned or held by or
for the account of the Company and the sale or issuance of such
treasury shares or the distribution of any such treasury shares
shall not be considered a Change of Shares for purposes of said
sections.
(B) No adjustment of the Exercise Price shall be made unless
such adjustment would require an increase or decrease of at least
$.02 in such price; provided that any adjustments which by reason of
this clause (B) are not required to be made shall be carried forward
and shall be made at the time of and together with the next
subsequent adjustment which, together with any adjustment(s) so
carried forward, shall require an increase or decrease of at least
$.02 in the Exercise Price then in effect hereunder.
(g) As used in this Section 8, the term "Common Stock" shall mean
and include the Common Stock authorized on the date of the original issue of the
Warrants and shall also include any capital stock of any class of the Company
thereafter authorized which shall not be limited to a fixed sum or percentage in
respect of the rights of the holders thereof to participate in dividends and in
the distribution of assets upon the voluntary liquidation, dissolution or
winding up of the Company; provided, however, that the shares issuable upon
exercise of the Warrants shall include only shares of such class designated in
the Company's Certificate of Incorporation as Common Stock on the date of the
original issue of the Warrants or (i), in the case of any reclassification,
change, consolidation, merger, sale or conveyance of the character referred to
in Section 8(c) hereof, the stock, securities or property provided for in such
section or (ii), in the case of any reclassification or change in the
outstanding shares of Common Stock issuable upon exercise of the Warrants as a
result of a subdivision or combination or consisting of a change in par value,
or from par value to no par value, or from no par value to par value, such
shares of Common Stock as so reclassified or changed.
(h) Any determination as to whether an adjustment in the Exercise
Price in effect hereunder is required pursuant to Section 8, or as to the amount
of any such adjustment, if required, shall be binding upon the Registered
Holders of the Warrants and the Company if made in good faith by the Board of
Directors of the Company.
(i) If and whenever the Company shall declare any dividends or
distributions payable otherwise than in cash out of earnings or earned surplus
(determined in accordance with generally accepted accounting principles,
consistently applied) or grant to all holders of Common Stock, as such, rights
or warrants to subscribe for or to purchase, or any options for the purchase of,
Common Stock or securities convertible into or exchangeable for or carrying a
right, warrant or option to purchase Common Stock, the Company shall notify each
of the then Registered Holders of the Warrants of such event prior to its
occurrence to
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enable such Registered Holders to exercise their Warrants and participate as
holders of Common Stock in such event.
SECTION 9. Fractional Warrants and Fractional Shares.
(a) Regardless of whether or not the number of shares of Common
Stock purchasable upon the exercise of each Warrant is adjusted pursuant to
Section 8 hereof, the Company shall nevertheless not be required to issue
fractions of shares upon exercise of the Warrants or otherwise, or to distribute
certificates that evidence fractional shares. With respect to any fraction of a
share called for upon any exercise hereof, the Company shall pay to the
Registered Holder an amount in cash equal to such fraction multiplied by the
current market price per share on the last business day prior to the date of
exercise. The current market price per share shall be determined, with respect
to any date, as follows:
(1) if the Common Stock is listed on a national securities exchange
or admitted to unlisted trading privileges on such exchange or listed for
trading on the Nasdaq National Market System ("NMS"), the current market
price per share on any date shall be the last reported sale price of the
Common Stock on such exchange or system on the last business day prior to
such date; or
(2) if the Common Stock is listed in the over-the-counter market
(other than on NMS) or admitted to unlisted trading privileges thereon,
the current market price per share for any date shall be the mean of the
last reported bid and asked prices reported by the National Quotation
Bureau, Inc. on the last business day prior to such date; or
(3) if the Common Stock is not so listed or admitted to unlisted
trading privileges and bid and asked prices are not so reported, the
current market price per share shall be an amount determined in such
reasonable manner as may be prescribed by the Board of Directors of the
Company.
SECTION 10. Warrant Holders Not Deemed Stockholders. No
Registered Holder shall, as such, be entitled to vote or to receive dividends or
be deemed the holder of Common Stock that may at any time be issuable upon
exercise of such Warrants for any purpose whatsoever, nor shall anything
contained herein be construed to confer upon the holder of Warrants, as such,
any of the rights of a stockholder of the Company or any right to vote for the
election of directors or upon any matter submitted to stockholders at any
meeting thereof, or to give or withhold consent to any corporate action (whether
upon any recapitalization, issue or reclassification of stock, change of par
value or change of stock to no par value, consolidation, merger or conveyance or
otherwise), or to receive notice of meetings, or to receive dividends or
subscription rights, until such Registered Holder shall have exercised such
Warrants and been issued shares of Common Stock in accordance with the
provisions hereof.
SECTION 11. Rights of Action. All rights of action with respect
to this Agreement are vested in the respective Registered Holders of the
Warrants, and any
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<PAGE>
Registered Holder of a Warrant, without consent of the Warrant Agent or of the
holder of any other Warrant, may, on his own behalf and for his own benefit,
enforce against the Company his right to exercise his Warrants for the purchase
of shares of Common Stock in the manner provided in the Warrant Certificate and
this Agreement.
SECTION 12. Agreement of Warrant Holders. Every holder of a Warrant,
by his acceptance thereof, consents and agrees with the Company, the Warrant
Agent and every other holder of a Warrant that:
(a) The Warrants are transferable only on the registry books of the
Warrant Agent by the Registered Holder thereof in person or by his
attorney-in-fact duly authorized in writing and only if the Warrant Certificates
representing such Warrants are surrendered at the office of the Warrant Agent,
duly endorsed or accompanied by a proper instrument of transfer satisfactory to
the Warrant Agent and the Company in their sole discretion, together with
payment of any applicable transfer taxes; and
(b) The Company may deem and treat the person in whose name the
Warrant Certificate is registered as the Registered Holder thereof and as the
absolute, true and lawful owner of the Warrants represented thereby for all
purposes, and the Company shall not be affected by any notice or knowledge to
the contrary, except as otherwise expressly provided in Section 7 hereof.
SECTION 13. Cancellation of Warrant Certificates. If the Company
shall purchase or acquire any Warrant or Warrants, whether upon exercise
thereof, open market purchase, redemption or otherwise, upon presentation
thereof to the Warrant Agent, the Warrant Certificate or Warrant Certificates
evidencing the same shall thereupon be cancelled by the Warrant Agent and
retired. The Warrant Agent shall also cancel Warrant Certificates surrendered to
the Warrant Agent following exercise of any or all of the Warrants represented
thereby or delivered to it for transfer, split-up, combination or exchange.
SECTION 14. Concerning the Warrant Agent. The Warrant Agent acts
hereunder as agent and in a ministerial capacity for the Company, and its duties
shall be determined solely by the provisions hereof. The Warrant Agent shall
not, by issuing and delivering Warrant Certificates or by any other act
hereunder, be deemed to make any representations as to the validity, value or
authorization of the Warrant Certificates or the Warrants represented thereby or
of any securities or other property delivered upon exercise of any Warrant or
whether any stock issued upon exercise of any Warrant is fully paid and
nonassessable.
The Warrant Agent shall account promptly to the Company with respect
to Warrants exercised and concurrently pay the Company, as provided in Section
4, all moneys received by the Warrant Agent upon the exercise of such Warrants.
The Warrant Agent shall, upon request of the Company from time to time, deliver
to the Company such complete reports of registered ownership of the Warrants and
such complete records of transactions with respect to the Warrants and the
shares of Common Stock as the Company may request. The
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<PAGE>
Warrant Agent shall also make available to the Company for inspection by its
agents or employees, from time to time as it may request, such original books of
accounts and record as may be maintained by the Warrant Agent in connection with
the issuance and exercise of Warrants hereunder, such inspections to occur at
the Warrant Agent's office as specified in Section 16 hereof, during normal
business hours.
The Warrant Agent shall not at any time be under any duty or
responsibility to any Registered Holder to make or cause to be made any
adjustment of the Exercise Price
provided in this Agreement, or to determine whether any fact exists which may
require any such adjustments, or with respect to the nature or extent of any
such adjustment, when made, or with respect to the method employed in making the
same. It shall not (i) be liable for any recital or statement of facts contained
herein or for any action taken, suffered or omitted by it in reliance on any
Warrant Certificate or other document or instrument believed by it in good faith
to be genuine and to have been signed or presented by the proper party or
parties, (ii) be responsible for any failure on the part of the Company to
comply with any of its covenants and obligations contained in this Agreement or
in any Warrant Certificate, or (iii) be liable for any act or omission in
connection with this Agreement except for its own negligence or willful
misconduct.
The Warrant Agent may at any time consult with counsel satisfactory
to it (who may be counsel for the Company) and shall incur no liability or
responsibility for any action taken, suffered or omitted by it in good faith in
accordance with the opinion or advice of such counsel.
Any notice, statement, instruction, request, direction, order or
demand of the Company shall be sufficiently evidenced by an instrument signed by
the Chairman of the Board, President, any Vice President, its Secretary, or
Assistant Secretary (unless other evidence in respect thereof is herein
specifically prescribed). The Warrant Agent shall not be liable for any action
taken, suffered or omitted by it in accordance with such notice, statement,
instruction, request, direction, order or demand believed by it to be genuine.
The Company agrees to pay the Warrant Agent reasonable compensation
for its services hereunder and to reimburse it for its reasonable out-of-pocket
expenses hereunder; it further agrees to indemnify the Warrant Agent and save it
harmless against any and all losses, expenses and liabilities, including
judgments, costs and counsel fees, for anything done or omitted by the Warrant
Agent in the execution of its duties and powers hereunder except losses,
expenses and liabilities arising as a result of the Warrant Agent's negligence
or willful misconduct.
The Warrant Agent may resign its duties and be discharged from all
further duties and liabilities hereunder (except liabilities arising as a result
of the Warrant Agent's own negligence or willful misconduct), upon 30 days'
prior written notice to the Company and the Company may discharge the Warrant
Agent from its duties and liabilities hereunder (except liabilities arising as a
result of the Warrant Agent's own negligence or willful misconduct) upon 30
days' prior written notice to the Warrant Agent. At least 15 days prior to
11
<PAGE>
the date such resignation or discharge is to become effective, the Warrant Agent
shall cause a copy of such notice of resignation or discharge to be mailed to
the Registered Holder of each Warrant Certificate at the Company's expense. Upon
such resignation or discharge, or any inability of the Warrant Agent to act as
such hereunder, the Company shall appoint a new warrant agent in writing. If the
Company shall fail to make such appointment within a period of 15 days after it
has been notified in writing of such resignation by the resigning Warrant Agent,
or within a period of 15 days after the Warrant Agent has been notified by the
Company of such discharge, then the Registered Holder of any Warrant Certificate
may apply to any court of competent jurisdiction for the appointment of a new
warrant agent. Any new warrant agent, whether appointed by the Company or by
such a court, shall be a bank or trust company having a capital and surplus, as
shown by its last published report to its stockholders, of not less than
$10,000,000 or a stock transfer company. After acceptance in writing of such
appointment by the new warrant agent is received by the Company, the Warrant
Agent's resignation or discharge shall be deemed to be effective and such new
warrant agent shall be vested with the same powers, rights, duties and
responsibilities as if it had been originally named herein as the Warrant Agent,
without any further assurance, conveyance, act or deed; but if for any reason it
shall be necessary or expedient to execute and deliver any further assurance,
conveyance, act or deed, the same shall be done at the expense of the Company
and shall be legally and validly executed and delivered by the resigning Warrant
Agent. Not later than the effective date of any such appointment the Company
shall file notice thereof with the resigning Warrant Agent and shall forthwith
cause a copy of such notice to be mailed to the Registered Holder of each
Warrant Certificate.
Any corporation into which the Warrant Agent or any new warrant
agent may be converted or merged or any corporation resulting from any
consolidation to which the Warrant Agent or any new warrant agent shall be a
party or any corporation succeeding to the trust business of the Warrant Agent
shall be a successor warrant agent under this Agreement without any further act,
provided that such corporation is eligible for appointment as successor to the
Warrant Agent under the provisions of the preceding paragraph. Any such
successor warrant agent shall promptly cause notice of its succession as warrant
agent to be mailed to the Company and to the Registered Holder of each Warrant
Certificate.
The Warrant Agent, its subsidiaries and affiliates, and any of its
or their officers or directors, may buy and hold or sell Warrants or other
securities of the Company and otherwise deal with the Company in the same manner
and to the same extent and with like effects as though it were not Warrant
Agent. Nothing herein shall preclude the Warrant Agent from acting in any other
capacity for the Company or for any other legal entity.
SECTION 15. Modification of Agreement.
(a) Subject to the provisions of Section 4(b) hereof, the parties
hereto may by supplemental agreement make any changes or corrections in this
Agreement (i) that they shall deem appropriate to cure any ambiguity or to
correct any defective or inconsistent provision or manifest mistake or error
herein contained or (ii) that they may deem necessary or desirable and which
shall not adversely affect the interests of the holders of Warrant Certificates;
12
<PAGE>
provided, however, that except as otherwise indicated in this Section and this
Agreement, this Agreement shall not otherwise be modified, supplemented or
altered in any respect except with the consent in writing of the Registered
Holders of Warrant Certificates representing not less than a majority of the
Warrants then outstanding.
(b) The Company shall have the right to reduce the Exercise Price
for a period of not less than thirty days on not less than thirty days' prior
written notice to the Registered Holders of the Warrants.
SECTION 16. Notices. All notices, requests, consents and other
communications hereunder shall be in writing and shall be deemed to have been
made when delivered or mailed first class registered or certified mail, postage
prepaid as follows: if to the Registered Holder of a Warrant Certificate, at the
address of such holder as shown on the registry books maintained by the Warrant
Agent; if to the Company, at 1675 West Maple Road, Troy, Michigan 48084,
Attention: Corporate Secretary; if to the Warrant Agent, at its Corporate
Office.
SECTION 17. Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of __________, without
reference to principles of conflict of laws.
SECTION 18. Binding Effect. This Agreement shall be binding upon and
inure to the benefit of the Company and the Warrant Agent (and their respective
successors and assigns) and the holders from time to time of Warrant
Certificates. Nothing in this Agreement is intended or shall be construed to
confer upon any other person any right, remedy or claim, in equity or at law, or
to impose upon any other person any duty, liability or obligation.
SECTION 19. Termination. This Agreement shall terminate on the
earliest to occur of (i) the Expiration Date of all the Warrants, (ii) the date
upon which all Warrants have been exercised and (iii) the date on which the
Company certifies to the Warrant Agent that no Warrants are outstanding;
provided however, that notwithstanding any such termination, the Warrant Agent
shall be obligated to deliver funds to the Company in accordance with this
Agreement.
SECTION 20. Counterparts. This Agreement may be executed in all
counterparts, all of which taken together shall constitute a single document.
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the date first above written.
ENERGY CONVERSION DEVICES, INC.
By: __________________________
Nancy M. Bacon
Senior Vice President
STATE STREET BANK AND
TRUST COMPANY
By: __________________________
Authorized Officer
14
<PAGE>
CERTIFICATE
NUMBER W _________ ____________WARRANTS
NOT EXERCISABLE AFTER 5:00 P.M.,
(NEW YORK CITY TIME), ON JULY 31, 2001,
OR SUCH EARLIER DATE AS PROVIDED HEREIN
ENERGY CONVERSION DEVICES, INC.
COMMON STOCK
PURCHASE WARRANTS CUSIP _________
THIS CERTIFIES THAT: ______________________________________ or
registered assigns is the registered holder (the "Registered Holder") of the
number of Warrants set forth above, each of which represents the right to
purchase one fully paid and nonassessable share of common stock, par value $.01
per share (the "Common Stock"), of Energy Conversion Devices, Inc., a Delaware
corporation (the "Company"), at any time until the Expiration Date hereinafter
referred to, by surrendering this Warrant Certificate, with the exercise form
set forth hereon duly executed with signatures guaranteed as provided below, at
the office maintained pursuant to the Warrant Agreement hereinafter referred to
for that purpose by State Street Bank and Trust Company, or its successor as
warrant agent (any such warrant agent being herein called the "Warrant Agent"),
and by paying in full the sum of $_____ per share, on or prior to January 31,
2000 and $____ per share on or prior to July 31, 2001 (the "Exercise Price"),
plus transfer taxes, if any. Payment of the Exercise Price shall be made in
United States currency, by certified check or money order payable to the order
of the Company.
Upon certain events provided for in the Warrant Agreement
hereinafter referred to, the Exercise Price and the number of shares of Common
Stock issuable upon the exercise of each Warrant are required to be adjusted.
No Warrant may be exercised after 5:00 P.M. (New York City time) on
the expiration date (the "Expiration Date") which will be July 31, 2001. After
the Expiration Date, all Warrants evidenced hereby shall thereafter become void,
and the holders thereof shall have no rights thereunder, except for the right to
receive the Redemption Price, if applicable.
Prior to the Expiration Date, subject to any applicable laws, rules
or regulations restricting transferability and to any restriction on
transferability that may appear on this Warrant Certificate in accordance with
the terms of the Warrant Agreement hereinafter referred to, the Registered
Holder shall be entitled to transfer this Warrant Certificate in whole
1
<PAGE>
or in part upon surrender of this Warrant Certificate at the office of the
Warrant Agent maintained for that purpose with the form of assignment set forth
hereon duly executed, with signatures guaranteed by a member firm of a national
securities exchange, a commercial bank, a savings bank or a savings and loan
association or a trust company located in the United States, a member of the
National Association of Securities Dealers, Inc. or other eligible guarantor
institution which is a participant in a signature guarantee program (as such
terms are defined in Reg. 240.17Ad-15 under the Securities Exchange Act of 1934)
applicable to the Warrant Agent. Upon any such transfer, a new Warrant
Certificate or Warrant Certificates representing the same aggregate number of
Warrants will be issued in accordance with the instructions in the form of
assignment.
Upon the exercise of less than all of the Warrants evidenced by this
Warrant Certificate, there shall be issued to the Registered Holder a new
Warrant Certificate in respect of the Warrants not exercised.
Prior to the Expiration Date, the Registered Holder shall be
entitled to exchange this Warrant Certificate, with or without other Warrant
Certificates, for another Warrant
Certificate or Warrant Certificates for the same aggregate number of Warrants,
upon surrender of this Warrant Certificate at the office maintained for such
purpose by the Warrant Agent.
No fractional shares will be issued upon the exercise of Warrants.
As to any final fraction of a share, which the Registered Holder of one or more
Warrant Certificates, the rights under which are exercised in the same
transaction, would otherwise be entitled to purchase upon such exercise, the
Company shall pay the cash value thereof determined as provided in the Warrant
Agreement.
This Warrant Certificate is issued under and in accordance with a
Warrant Agreement between the Company and the Warrant Agent (the "Warrant
Agreement") and is subject to the terms and provisions contained in said Warrant
Agreement, to all of which terms and provisions the Registered Holder consents
by acceptance hereof.
This Warrant Certificate shall not entitle the Registered Holder to
any of the rights of a stockholder of the Company, including, without
limitation, the right to vote, to receive dividends and other distributions, or
to attend or receive any notice of meetings of stockholders or any other
proceedings of the Company.
This Warrant Certificate shall not be valid for any purpose until it
shall have been countersigned by the Warrant Agent.
2
<PAGE>
IN WITNESS WHEREOF, the Company has caused this Warrant Certificate
to be duly executed under its corporate seal.
DATED: COUNTERSIGNED:
STATE STREET AND TRUST COMPANY
WARRANT AGENT
BY: ___________________________
AUTHORIZED OFFICER
ENERGY CONVERSION DEVICES, INC.
BY: ___________________________
PRESIDENT AND CHIEF
EXECUTIVE OFFICER
- -----------------------------
SECRETARY
3
<PAGE>
EXERCISE FORM
To Be Executed by the Registered Holder
in Order to Exercise Warrants
The undersigned Registered Holder hereby irrevocably elects to exercise
___________ Warrants represented by this Warrant Certificate, and to purchase
the securities issuable upon the exercise of such Warrants, and requests that
certificates for such securities shall be issued in the name of:
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER
==================================
==================================
[please print or type name and address]
and be delivered to:
==================================
==================================
[please print or type name and address]
and if such number of Warrants shall not be all the Warrants evidenced by this
Warrant Certificate, that a new Warrant Certificate for the balance of such
Warrants be registered in the name of, and delivered to, the Registered Holder
at the address stated above.
Accepted and Agreed To:
X______________________________ Address:
==========================
==========================
Social Security or Tax Payer
Identification Number
--------------------------
Signature Guaranteed
--------------------------
A-1
<PAGE>
ASSIGNMENT
To Be Executed by the Registered Holder
in Order to Assign Warrants
FOR VALUE RECEIVED, ______________________________________ hereby sells, assigns
and transfers unto:
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER
==================================
==================================
[please print or type name and address]
_______________________________ of the Warrants represented by this Warrant
Certificate, and hereby irrevocably constitutes and appoints _________________
- ---------------------------------------------------------------------
Attorney-in-fact to transfer this Warrant Certificate on the books of the
Company, with full power of substitution in the premises.
Dated: __________________________ Signature(s) Guaranteed:
Signed: _________________________ __________________________
THE SIGNATURE(S) SHOULD BE
GUARANTEED BY AN ELIGIBLE
GUARANTOR INSTITUTION (BANKS,
STOCKBROKERS, SAVINGS AND LOAN
ASSOCIATIONS AND CREDIT UNIONS
WITH MEMBERSHIP IN AN APPROVED
SIGNATURE GUARANTEE MEDALLION
PROGRAM), PURSUANT TO S.E.C.
RULE 17Ad-15
THE SIGNATURE TO THE ASSIGNMENT OR THE EXERCISE FORM M[UST CORRESPOND TO THE
NAME AS WRITTEN UPON THE FACE OF THIS WARRANT CERTIFICATE IN EVERY PARTICULAR,
WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATSOEVER, AND MUST BE
GUARANTEED BY A COMMERCIAL BANK, TRUST COMPANY OR SAVINGS BANK OR SAVINGS AND
LOAN ASSOCIATION OR A MEMBER FIRM OF THE AMERICAN STOCK EXCHANGE, NEW YORK STOCK
EXCHANGE, PACIFIC STOCK EXCHANGE OR MIDWEST STOCK EXCHANGE.
A-2
EXHIBIT 5.1
[JENNER & BLOCK LETTERHEAD]
April 21, 1998
Energy Conversion Devices, Inc.
1675 West Maple Road
Troy, Michigan 48084
Gentlemen:
We have acted as counsel to Energy Conversion Devices, Inc., a
Delaware corporation (the "Company"), in connection with the Registration
Statement on Form S-3 (the "Registration Statement") filed by the Company with
the Securities and Exchange Commission (the "Commission") under the Securities
Act of 1933, as amended (the "Securities Act") , relating to the issuance and
sale by the Company of up to 2,000,000 units consisting of one share of the
Company's Common Stock, par value $.01 per share ("Common Stock"), and a warrant
to purchase one additional share of Common Stock. The shares of Common Stock to
be registered pursuant to the Registration Statement are referred to herein
collectively as the "Shares." We have examined the Registration Statement as
filed by the Company with the Commission. We have additionally reviewed such
other documents and made such further investigations as we have deemed necessary
to enable us to express the opinion hereinafter set forth.
Based on the foregoing, we hereby advise you that in our opinion
the Shares will, when issued by the Company in accordance with the plan of
distribution described in the Registration Statement, be validly issued, fully
paid and nonassessable.
We hereby consent to the filing of this opinion as a exhibit to
the Registration Statement.
Very truly yours,
JENNER & BLOCK
By /S/ Craig A. Roeder
----------------------
A Partner
EXHIBIT 23.2
[DELOITTE & TOUCHE LETTERHEAD]
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
Energy Conversion Devices, Inc. on Form S-3 of our report dated September 26,
1997 included in the Annual Report on Form 10-K/A (Amendment No. 1) of Energy
Conversion Devices, Inc. for the year ended June 30, 1997 and to the reference
to us under the heading "Experts" in the Prospectus, which is part of this
Registration Statement.
Deloitte & Touche LLP
Detroit, Michigan
April 21, 1998
