Exhibit
10.3


NEITHER THESE SECURITIES NOR THE
SECURITIES FOR WHICH THESE SECURITIES ARE EXERCISABLE HAVE BEEN REGISTERED WITH
THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY
STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE
OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A
TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT
AND IN COMPLIANCE WITH APPLICABLE STATE SECURITIES OR BLUE SKY LAWS.  THESE SECURITIES AND THE SECURITIES ISSUABLE
UPON EXERCISE OF THESE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE
MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES, SUBJECT TO THE TERMS
OF THIS LEGEND AND THE SECURITIES ACT.


SATCON TECHNOLOGY CORPORATION


WARRANT A


	
  Warrant A No. [ ]

  	
   

  	
  Dated: July 19, 2006

  



 


SatCon Technology Corporation, a Delaware corporation
(the “Company”), hereby certifies
that, for value received, [Name of Holder] or its registered assigns (the “Holder”), is entitled to purchase from the
Company up to a total of [          ]
shares of common stock, $0.01 par value per share (the “Common Stock”), of the Company (each such
share, a “Warrant Share” and all
such shares, the “Warrant Shares”)
at an exercise price equal to $1.815 per share (as adjusted from time to time
as provided in Section 9, the “Exercise
Price”), at any time and from time to time from and after the six
month anniversary of the Closing Date and through and including the date that
is seven years from the date of issuance hereof (the “Expiration Date”), and subject to the
following terms and conditions.  This
Warrant (this “Warrant”) is one of
a series of similar warrants issued pursuant to that certain Securities
Purchase Agreement, dated as of July 19, 2006, by and among the Company and the
Purchasers identified therein (the “Purchase
Agreement”).  All such
warrants are referred to herein, collectively, as the “Warrants.”


1.             Definitions.  In addition to the terms defined elsewhere in
this Warrant, capitalized terms that are not otherwise defined herein have the
meanings given to such terms in the Purchase Agreement.


2.             Registration
of Warrant.  The Company shall
register this Warrant, upon records to be maintained by the Company for that
purpose (the “Warrant Register”),
in the name of the record Holder hereof from time to time.  The Company may deem and treat the registered
Holder









 



of this Warrant as the
absolute owner hereof for the purpose of any exercise hereof or any
distribution to the Holder, and for all other purposes, absent actual notice to
the contrary.


3.             Registration
of Transfers.  The Company shall
register the assignment and transfer of any portion of this Warrant in the
Warrant Register, upon surrender of this Warrant, with the Form of Assignment
attached hereto on Annex B duly completed and signed, to the Company at
its address specified herein.  Upon any
such registration or transfer, a new warrant to purchase Common Stock, in
substantially the form of this Warrant (any such new warrant, a “New Warrant”), evidencing the portion of
this Warrant so transferred shall be issued to the transferee and a New Warrant
evidencing the remaining portion of this Warrant not so transferred, if any,
shall be issued to the transferring Holder. 
The acceptance of the New Warrant by the transferee thereof shall be
deemed the acceptance by such transferee of all of the rights and obligations
of a holder of a Warrant.


4.             Exercise
and Duration of Warrants.


(a)           This Warrant shall be exercisable by the
registered Holder at any time and from time to time on or after the six month
anniversary of the Closing Date to and including the Expiration Date.  At 6:30 P.M., New York City time on the
Expiration Date, the portion of this Warrant not exercised prior thereto shall
be and become void and of no value; provided that, if the average of the Closing
Prices for the five Trading Days immediately prior to (but not including) the
Expiration Date exceeds the Exercise Price on the Expiration Date, then this
Warrant shall be deemed to have been exercised in full (to the extent not
previously exercised) on a “cashless exercise” basis at 6:30 P.M. New York City
time on the Expiration Date if a “cashless exercise” may occur at such time
pursuant to Section 10 below.


(b)           A Holder may exercise this Warrant by
delivering to the Company (i) an exercise notice, in the form attached hereto
on Annex A (the “Exercise
Notice”), appropriately completed and duly signed, and
(ii) payment of the Exercise Price for the number of Warrant Shares as to
which this Warrant is being exercised (which may take the form of a “cashless
exercise” if so indicated in the Exercise Notice and if a “cashless exercise”
may occur at such time pursuant to this Section 10 below), and the date such
items are delivered to the Company (as determined in accordance with the notice
provisions hereof) is an “Exercise Date.”  The Holder shall not be required to deliver
the original Warrant in order to effect an exercise hereunder.  Execution and delivery of the Exercise Notice
shall have the same effect as cancellation of the original Warrant and issuance
of a New Warrant evidencing the right to purchase the remaining number of
Warrant Shares.


5.             Delivery
of Warrant Shares.


(a)           Upon exercise of this Warrant, the
Company shall promptly (but in no event later than three Trading Days after the
Exercise Date) issue or cause to be issued and cause to be delivered to or upon
the written order of the Holder and in such name or names as the Holder may
designate, a certificate for the Warrant Shares issuable upon such exercise,
free of restrictive legends unless a registration statement covering the resale
of the Warrant Shares and naming the Holder as a selling stockholder thereunder
is not then effective and the Warrant Shares are not freely transferable
without volume restrictions pursuant to Rule 144 under the 



 2
  
 






 



Securities Act.  The Holder, or
any Person so designated by the Holder to receive Warrant Shares, shall be
deemed to have become holder of record of such Warrant Shares as of the
Exercise Date.  The Company shall, upon
request of the Holder, use its best efforts to deliver Warrant Shares hereunder
electronically through the Depository Trust Corporation or another established
clearing corporation performing similar functions.


(b)           This Warrant is exercisable, either in
its entirety or, from time to time, for a portion of the number of Warrant
Shares.  Upon surrender of this Warrant
following one or more partial exercises, the Company shall issue or cause to be
issued, at its expense, a New Warrant evidencing the right to purchase the
remaining number of Warrant Shares.


(c)           In addition to any other rights
available to a Holder, if the Company fails to deliver to the Holder a
certificate representing Warrant Shares by the third Trading Day after exercise
of this Warrant in full compliance with Section 4(b), and if after such third
Trading Day the Holder purchases (in an open market transaction or otherwise)
shares of Common Stock to deliver in satisfaction of a sale by the Holder of
the Warrant Shares that the Holder anticipated receiving from the Company (a “Buy-In”), then the Company shall, within three Trading Days
after the Holder’s request and in the Holder’s discretion, either (i) pay cash
to the Holder in an amount equal to the Holder’s total purchase price
(including brokerage commissions, if any) for the shares of Common Stock so
purchased (the “Buy-In Price”), at which point
the Company’s obligation to deliver such certificate (and to issue such Common
Stock) shall terminate, or (ii) promptly honor its obligation to deliver to the
Holder a certificate or certificates representing such Common Stock and pay
cash to the Holder in an amount equal to the excess (if any) of the Buy-In
Price over the product of (A) such number of shares of Common Stock, times (B)
the Closing Price on the date of the event giving rise to the Company’s
obligation to deliver such certificate.


(d)           The Company’s obligations to issue and
deliver Warrant Shares in accordance with the terms hereof are absolute and
unconditional, irrespective of any action or inaction by the Holder to enforce
the same, any waiver or consent with respect to any provision hereof, the
recovery of any judgment against any Person or any action to enforce the same,
or any setoff, counterclaim, recoupment, limitation or termination, or any breach
or alleged breach by the Holder or any other Person of any obligation to the
Company or any violation or alleged violation of law by the Holder or any other
Person, and irrespective of any other circumstance which might otherwise limit
such obligation of the Company to the Holder in connection with the issuance of
Warrant Shares.  Nothing herein shall
limit a Holder’s right to pursue any other remedies available to it hereunder,
at law or in equity including, without limitation, a decree of specific performance
and/or injunctive relief with respect to the Company’s failure to timely
deliver certificates representing shares of Common Stock upon exercise of the
Warrant  as required pursuant to the
terms hereof.


6.             Charges,
Taxes and Expenses.   Issuance and
delivery of certificates for shares of Common Stock upon exercise of this
Warrant shall be made without charge to the Holder for any issue or transfer
tax, withholding tax, transfer agent fee or other incidental tax or expense in
respect of the issuance of such certificates, all of which taxes and expenses
shall be paid by the Company; provided, however, that the Company shall not be
required to pay any tax which may be payable in respect of any transfer
involved in the registration of any certificates for Warrant 



 3
  
 






 



Shares or Warrants in a
name other than that of the Holder or an Affiliate thereof.  The Holder shall be responsible for all other
tax liability that may arise as a result of holding or transferring this
Warrant or receiving Warrant Shares upon exercise hereof.


7.             Replacement
of Warrant.  If this Warrant is
mutilated, lost, stolen or destroyed, the Company shall issue or cause to be
issued in exchange and substitution for and upon cancellation hereof, or in
lieu of and substitution for this Warrant, a New Warrant, but only upon receipt
of evidence reasonably satisfactory to the Company of such loss, theft or
destruction and customary and reasonable indemnity, if requested.


8.             Reservation
of Warrant Shares.  The Company
covenants that it will at all times reserve and keep available out of the
aggregate of its authorized but unissued and otherwise unreserved Common Stock,
solely for the purpose of enabling it to issue Warrant Shares upon exercise of
this Warrant as herein provided, the number of Warrant Shares which are then
issuable and deliverable upon the exercise of this entire Warrant, free from
preemptive rights or any other contingent purchase rights of persons other than
the Holder (taking into account the adjustments and restrictions of Section
9). The Company covenants that all Warrant Shares so issuable and
deliverable shall, upon issuance and the payment of the applicable Exercise
Price in accordance with the terms hereof, be duly and validly authorized,
issued and fully paid and nonassessable. 
The Company will take all such action as may be necessary to assure that
such shares of Common Stock may be issued as provided herein without violation
of any applicable law or regulation, or of any requirements of any securities
exchange or automated quotation system upon which the Common Stock may be
listed.


9.             Certain
Adjustments.  The Exercise Price and
number of Warrant Shares issuable upon exercise of this Warrant are subject to
adjustment from time to time as set forth in this Section 9.


(a)           Stock Dividends and Splits.  If the Company, at any time while this
Warrant is outstanding, (i) pays a stock dividend on its Common Stock or
otherwise makes a distribution on any class of capital stock that is payable in
shares of Common Stock, (ii) subdivides outstanding shares of Common Stock into
a larger number of shares, or (iii) combines outstanding shares of Common Stock
into a smaller number of shares, then in each such case the Exercise Price
shall be multiplied by a fraction of which the numerator shall be the number of
shares of Common Stock outstanding immediately before such event and of which
the denominator shall be the number of shares of Common Stock outstanding
immediately after such event.  Any
adjustment made pursuant to clause (i) of this paragraph shall become effective
immediately after the record date for the determination of stockholders
entitled to receive such dividend or distribution, and any adjustment pursuant
to clause (ii) or (iii) of this paragraph shall become effective immediately
after the effective date of such subdivision or combination.


(b)           Pro Rata Distributions.  If the Company, at any time while this
Warrant is outstanding, distributes to holders of Common Stock (i) evidences of
its indebtedness, (ii) any security (other than a distribution of Common Stock
covered by the preceding paragraph), (iii) rights or warrants to subscribe
for or purchase any security, or (iv) any other asset (in each case, “Distributed Property”), then in each such case the Exercise
Price in effect immediately prior to the record date fixed for determination of
stockholders entitled to receive such 



 4
  
 






 



distribution shall be adjusted (effective on such record date) to equal
the product of such Exercise Price times a fraction of which the denominator
shall be the average of the Closing Prices for the five Trading Days
immediately prior to (but not including) such record date and of which the
numerator shall be such average less the then fair market value of the
Distributed Property distributed in respect of 
one outstanding share of Common Stock, as determined by the Company’s
independent certified public accountants that regularly examine the financial
statements of the Company, (an “Appraiser”).  In such event, the Holder, after receipt of
the determination by the Appraiser, shall have the right to select an
additional appraiser (which shall be a nationally recognized accounting firm),
in which case such fair market value shall be deemed to equal the average of
the values determined by each of the Appraiser and such appraiser.  As an alternative to the foregoing adjustment
to the Exercise Price, at the request of the Holder delivered to the Company in
writing before the 45th day after such record date, the Company will deliver to
such Holder, within five Trading Days after such request (or, if later, on the
effective date of such distribution), the Distributed Property that such Holder
would have been entitled to receive in respect of the Warrant Shares for which
this Warrant could have been exercised immediately prior to such record
date.  If such Distributed Property is
not delivered to a Holder pursuant to the preceding sentence, then upon
expiration of or any exercise of the Warrant that occurs after such record
date, such Holder shall remain entitled to receive, in addition to the Warrant
Shares otherwise issuable upon such exercise (if applicable), such Distributed
Property.


(c)           Fundamental Transactions.  If, at any time while this Warrant is
outstanding, (i) the Company effects any merger or consolidation of the Company
with or into another Person, (ii) the Company effects any sale of all or
substantially all of its assets in one or a series of related transactions,
(iii) any tender offer or exchange offer (whether by the Company or another
Person) is completed pursuant to which holders of Common Stock are permitted to
tender or exchange their shares for other securities, cash or property, or (iv)
the Company effects any reclassification of the Common Stock or any compulsory share
exchange pursuant to which the Common Stock is effectively converted into or
exchanged for other securities, cash or property (other than as a result of a
subdivision or combination of shares of Common Stock covered by Section 9(a)
above) (in any such case, a “Fundamental
Transaction”), then the Holder shall have the right thereafter to
receive, upon exercise of this Warrant, the same amount and kind of securities,
cash or property as it would have been entitled to receive upon the occurrence
of such Fundamental Transaction if it had been, immediately prior to such
Fundamental Transaction, the holder of the number of Warrant Shares then
issuable upon exercise in full of this Warrant (the “Alternate
Consideration”).  The
aggregate Exercise Price for this Warrant will not be affected by any such
Fundamental Transaction, but the Company shall apportion such aggregate
Exercise Price among the Alternate Consideration in a reasonable manner
reflecting the relative value of any different components of the Alternate
Consideration.  If holders of Common
Stock are given any choice as to the securities, cash or property to be
received in a Fundamental Transaction, then the Holder shall be given the same
choice as to the Alternate Consideration it receives upon any exercise of this
Warrant following such Fundamental Transaction. 
In the event of a Fundamental Transaction, the Company or the successor
or purchasing Person, as the case may be, shall execute with the Holder a
written agreement providing that:



 5
  
 






 



(x)   this Warrant shall thereafter entitle the
Holder to purchase the Alternate Consideration in accordance with this section
9(c),


(y)  in the case of any such successor or
purchasing Person, upon such consolidation, merger, statutory exchange,
combination, sale or conveyance such successor or purchasing Person shall be
jointly and severally liable with the Company for the performance of all of the
Company’s obligations under this Warrant and the Purchase Agreement, and


(z)   if registration or qualification is required
under the Exchange Act or applicable state law for the public  resale by the Holder of shares of stock and
other securities so issuable upon exercise of this Warrant, such registration
or qualification shall be completed prior to such reclassification, change,
consolidation, merger, statutory exchange, combination or sale.


If, in the
case of any Fundamental Transaction, the Alternate Consideration includes
shares of stock, other securities, other property or assets of a Person other
than the Company or any such successor or purchasing Person, as the case may
be, in such Fundamental Transaction, then such written agreement shall also be
executed by such other Person and shall contain such additional provisions to
protect the interests of the Holder as the Board of Directors of the Company
shall reasonably consider necessary by reason of the foregoing.  At the Holder’s request, any successor to the
Company or surviving entity in such Fundamental Transaction shall issue to the
Holder a new warrant consistent with the foregoing provisions and evidencing
the Holder’s right to purchase the Alternate Consideration for the aggregate
Exercise Price upon exercise thereof. 
The terms of any agreement pursuant to which a Fundamental Transaction
is effected shall include terms requiring any such successor or surviving
entity to comply with the provisions of this paragraph (c) and insuring that
the Warrant (or any such replacement security) will be similarly adjusted upon
any subsequent transaction analogous to a Fundamental Transaction. If any
Fundamental Transaction constitutes or results in a Change of Control, then at
the request of the Holder delivered to the Company in writing before the 45th
day after such Fundamental Transaction, the Company (or any such successor or
surviving entity) will purchase this Warrant from the Holder for a purchase
price, payable in cash within five Trading Days after such request (or, if
later, on the effective date of the Fundamental Transaction), equal to the
Black-Scholes value of the remaining unexercised portion of this Warrant on the
date of such request.


(d)           Subsequent Equity Sales.


(i)            For so long as this Warrant is
outstanding, the Company or any Subsidiary shall not issue additional shares of
Common Stock or rights, warrants, options or other securities or debt
convertible, exercisable or exchangeable for shares of Common Stock or
otherwise entitling any Person to acquire shares of Common Stock (collectively,
“Common Stock Equivalents”)
at an effective price per share of Common Stock (prior to deducting fees,
commissions and other expenses related to such issuance) (the “Effective Price”) less than the Conversion Price (as defined
in the Notes) (as adjusted to such date) (a “Prohibited
Issuance”).  For purposes of
this paragraph, in connection with any issuance of any Common Stock
Equivalents, (A) the maximum number of shares of Common Stock potentially
issuable at any time upon conversion, exercise or exchange of 



 6
  
 






 



such Common
Stock Equivalents (the “Deemed
Number”) shall be deemed to be outstanding upon issuance of such
Common Stock Equivalents, (B) the Effective Price applicable to such Common
Stock shall equal the minimum dollar value of consideration payable to the
Company to purchase such Common Stock Equivalents and to convert, exercise or
exchange them into Common Stock (prior to deducting any fees, commissions and
other expenses related thereto), divided by the Deemed Number, and (C) the
actual issuance of Common Stock upon conversion, exercise or exchange of such
Common Stock Equivalents shall not be subject again to this Section 9(d)(i).


(ii)           If, at any time while this Warrant is
outstanding, the Company or any Subsidiary issues Common Stock Equivalents with
an Effective Price or a number of underlying shares that floats or resets or
otherwise varies or is subject to adjustment based (directly or indirectly) on
market prices of the Common Stock (a “Floating
Price Security”), then for purposes of applying the preceding
paragraph, whether Section 9(d)(i) has been violated will be determined
separately each time such adjustment occurs.


(iii)          In the event the Company breaches Section
9(d)(i), then at the request of the Holder delivered to the Company in
writing before the 45th day after such Prohibited Issuance, the Company (or any
such successor or surviving entity) will purchase this Warrant from the Holder
for a purchase price, payable in cash within five Trading Days after such
request, equal to the Black-Scholes value of the remaining unexercised portion
of this Warrant on the date of such request.


(iv)          Notwithstanding the foregoing, the
Company shall be permitted to issue Excluded Stock.


(e)           Number of Warrant Shares.  Simultaneously with any adjustment to the
Exercise Price pursuant to paragraphs (a) or (b) of this Section, the number of
Warrant Shares that may be purchased upon exercise of this Warrant shall be
increased or decreased proportionately, so that after such adjustment the
aggregate Exercise Price payable hereunder for the increased or decreased
number of Warrant Shares shall be the same as the aggregate Exercise Price in
effect immediately prior to such adjustment.


(f)            Calculations.  All calculations under this Section 9
shall be made to the nearest cent or the nearest 1/100th of a share, as
applicable.  The number of shares of
Common Stock outstanding at any given time shall not include shares owned or
held by or for the account of the Company, and the disposition of any such
shares shall be considered an issue or sale of Common Stock.


(g)           Notice of Adjustments.  Upon the occurrence of each adjustment
pursuant to this Section 9, the Company at its expense will promptly
compute such adjustment in accordance with the terms of this Warrant and
prepare a certificate setting forth such adjustment, including a statement of
the adjusted Exercise Price and adjusted number or type of Warrant Shares or
other securities issuable upon exercise of this Warrant (as applicable),
describing the transactions giving rise to such adjustments and showing in
detail the facts upon which such adjustment is based.  The Company will promptly deliver a copy of
each such certificate to the Holder within 10 Trading Days of the occurrence of
such adjustment.



 7
  
 






 



(h)           Notice of Corporate Events.  If the Company  (i) declares a dividend or any other
distribution of cash, securities or other property in respect of its Common
Stock, including without limitation any granting of rights or warrants to
subscribe for or purchase any capital stock of the Company or any Subsidiary,
(ii) authorizes or approves, enters into any agreement contemplating or
solicits stockholder approval for any Fundamental Transaction or (iii)
authorizes the voluntary dissolution, liquidation or winding up of the affairs
of the Company, then the Company shall deliver to the Holder a notice
describing the material terms and conditions of such transaction, at least 20
calendar days prior to the applicable record or effective date on which a
Person would need to hold Common Stock in order to participate in or vote with
respect to such transaction, and the Company will take all steps reasonably
necessary in order to insure that the Holder is given the practical opportunity
to exercise this Warrant prior to such time so as to participate in or vote
with respect to such transaction; provided, however, that the failure to
deliver such notice or any defect therein shall not affect the validity of the
corporate action required to be described in such notice.


10.           Payment
of Exercise Price.  The Holder shall
pay the Exercise Price in cash in immediately available funds; provided,
however, that if a Registration Statement covering the resale of the
Warrant Shares is not effective at the time of exercise, the Holder may satisfy
its obligation to pay the Exercise Price through a “cashless exercise,” in
which event the Company shall issue to the Holder the number of Warrant Shares
determined as follows:




	
  

  	
   

  	
  X = Y [(A-B)/A]

  
	
  where:

  	
   

  	
   

  
	
   

  	
   

  	
  X = the number of Warrant Shares to be issued to the
  Holder.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Y = the number of Warrant Shares with respect to
  which this Warrant is being exercised.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  A = the arithmetic average of the VWAP for the five
  Trading Days immediately prior to (but not including) the Exercise Date.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  B = the Exercise Price.

  






 


For purposes of
Rule 144 promulgated under the Securities Act, it is intended, understood and
acknowledged that the Warrant Shares issued in a cashless exercise transaction
shall be deemed to have been acquired by the Holder, and the holding period for
the Warrant Shares shall be deemed to have commenced, on the date this Warrant
was originally issued pursuant to the Purchase Agreement.


11.           Limitation on Exercise.


(a)           Notwithstanding
anything to the contrary contained herein, the
number of shares of Common Stock that may be acquired by the Holder upon any
exercise of this Warrant (or otherwise in respect hereof) shall be limited to
the extent necessary to insure that, following such exercise (or other
issuance), the total number of shares of Common Stock then beneficially owned
by such Holder and its Affiliates and any other Persons whose beneficial
ownership of 



 8
  
 






 



Common Stock would be aggregated
with the Holder’s for purposes of Section 13(d) of the Exchange Act, does not
exceed 4.999%  (the “Threshold Percentage”) or 9.999% (the “Maximum Percentage”) of the
total number of issued and outstanding shares of Common Stock (including for
such purpose the shares of Common Stock issuable upon such exercise).  For such purposes, beneficial ownership shall
be determined in accordance with Section 13(d) of the Exchange Act and the
rules and regulations promulgated thereunder. 
Each delivery of an Exercise Notice hereunder will constitute a
representation by the Holder that it has evaluated the limitations set forth in
this paragraph and determined that issuance of the full number of Warrant
Shares requested in such Exercise Notice is permitted under this
paragraph.  The Company’s obligation to
issue shares of Common Stock in excess of the limitation referred to in this
Section shall be suspended (and shall not terminate or expire notwithstanding
any contrary provisions hereof) until such time, if any, as such shares of
Common Stock may be issued in compliance with such limitation.  By written notice to the Company, the Holder
shall have the right (x) at any time and from time to time to reduce its
Maximum Percentage immediately upon notice to the Company in the event and only
to the extent that Section 16 of the Exchange Act or the rules promulgated thereunder
(or any successor statute or rules) is changed to reduce the beneficial
ownership percentage threshold thereunder to a percentage less than 9.999% and
(y) at any time and from time to time, to waive the provisions of this Section
insofar as they relate to the Threshold Percentage or to increase or decrease
its Threshold Percentage (but not in excess of the Maximum Percentage) unless
the Holder shall have, by written instrument delivered to the Company,
irrevocably waived its rights to so increase or decrease its Threshold
Percentage, but (i) any such waiver, increase or decrease will not be effective
until the 61st day after such notice is delivered to the Company, and (ii) any
such waiver or increase or decrease will apply only to the Holder and not to
any other holder of Warrants.


(b)           Notwithstanding anything to the contrary
contained herein, the number of shares of
Common Stock that may be acquired by the Holder upon any exercise of this
Warrant (or otherwise in respect hereof) shall be limited to the extent
necessary to insure that, following such exercise (or other issuance), the
total number of shares of Common Stock then beneficially owned by such Holder
and its Affiliates and any other Persons whose beneficial ownership of Common
Stock would be aggregated with the Holder’s for purposes of Section 13(d) of
the Exchange Act, does not exceed 19.999% of the total number of issued and
outstanding shares of Common Stock (including for such purpose the shares of
Common Stock issuable upon such exercise).  For such purposes, beneficial ownership shall
be determined in accordance with Section 13(d) of the Exchange Act and the
rules and regulations promulgated thereunder.


12.           Fractional
Shares.  The Company shall not be
required to issue or cause to be issued fractional Warrant Shares on the
exercise of this Warrant.  If any
fraction of a Warrant Share would, except for the provisions of this Section,
be issuable upon exercise of this Warrant, the number of Warrant Shares to be
issued will be rounded up to the nearest whole share or right to purchase the nearest whole
share, as the case may be.


13.           Notices.  Any and all notices or other communications
or deliveries hereunder (including without limitation any Exercise Notice)
shall be in writing and shall be deemed given and effective on the earliest of
(i) the date of transmission, if such notice or communication is delivered via
facsimile at the facsimile number specified in this Section prior to 6:30 p.m.
(New York City time) on a Trading Day, (ii) the next Trading Day after the date
of transmission, if such notice or communication is delivered via facsimile at
the facsimile number specified in this Section on a day that is not a Trading
Day or later than 6:30 p.m. (New 



 9
  
 






 



York City time) on any Trading Day, (iii) the Trading
Day following the date of mailing, if sent by a nationally recognized overnight
courier service, or (iv) upon actual receipt by the party to whom such notice
is required to be given.  The address for
such notices or communications shall be as set forth in the Purchase Agreement.


14.           Call Right.


(a)           If following the later of the (i)
Effective Date and (ii) the six month anniversary of the date hereof, the
Closing Prices for any 20 consecutive Trading Days exceeds 200% of the Exercise
Price (the “Threshold I Price”,
and such 20 day period, the “Threshold I
Period”), then the Company will have the right, but not obligation
(the “Call I Right”), on prior
written notice in accordance with Section 14(c) below to require the Holder to
exercise up to 50% of any unexercised portion of this Warrant for which an
Exercise Notice has not yet been delivered (the “Call I Amount”); provided that the Call I Right must be
exercised within 20 Trading Days of the last day of the Threshold I Period.


(b)           If following the 24 month anniversary of
the date hereof, the Closing Prices for any 20 consecutive Trading Days exceeds
300% of the Exercise Price (the “Threshold II
Price”, and together with the Threshold I Price, each a “Threshold Price” and such 20 day period,
the “Threshold II Period”), then
the Company will have the right, but not obligation (the “Call II Right”, and together with the Call
I Right, each a “Call Right”), on
prior written notice in accordance with Section 14(c) below to require the
Holder to exercise any unexercised portion of this Warrant for which an
Exercise Notice has not yet been delivered (the “Call II Amount”, and together with the Call I Amount, each a “Call Amount”); provided that the Call II
Right must be exercised within 20 Trading Days of the last day of the Threshold
II Period.


(c)           To exercise a Call Right, the Company
shall deliver to the Holder an irrevocable written notice (a “Call Notice”), indicating the applicable Call Amount.  The date that the Company delivers the Call
Notice to the Holders will be referred to as the “Call Date.” Within 15 Trading Days of receipt of the Call
Notice, the Holder shall exercise this Warrant for up to the applicable Call
Amount in accordance with Section 4(b) above. 
Any portion of the Call Amount that is not exercised by 6:30 p.m. (New
York City time) on the 15th Trading Day following the date of receipt of the
Call Notice (the “Forced Exercise Date”)
shall be cancelled.  Any unexercised
portion of this Warrant to which the Call Notice does not pertain (the “Remaining Portion”) will be unaffected by such Call
Notice.  The Company covenants and agrees
that it will honor any Exercise Notice with respect to the Call Amount that are
tendered from the Call Date through and including 6:30 p.m. (New York City
time) on the Forced Exercise Date.


(d)           Notwithstanding anything to the contrary
set forth in this Warrant, the Company may not require the cancellation of any
unexercised Call Amount (and any Call Notice will be void), unless from the
beginning of the 20 consecutive Trading Days used to determine whether the
Common Stock has achieved the applicable Threshold Price through the Forced 



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Exercise Date (the “Call Period”)
(i) the Closing Prices for each Trading Day during such Call Period exceeds
such Threshold Price, (ii) the Company shall have honored in accordance with
the terms of this Warrant any Exercise Notice delivered by 6:30 p.m. (New York
City time) on the Forced Exercise Date, (iii) the Equity Conditions (as defined
in the Notes) are satisfied (or waived in writing by the applicable Holder) on
each Trading Day with respect to all Underlying Shares issuable upon exercise
of the Call Amount, and (iv) the average daily trading volume as reported on
Bloomberg, L.P. during such Call Period (determined by calculating the
arithmetic average of the daily trading volume for each Trading Day in such
Call Period) is greater than 100,000 shares.


(e)           Notwithstanding anything herein to the
contrary, (i) in connection with the Company’s exercise of a Call Right, the
Threshold Percentage limitation on exercise set forth in Section 11 shall not
apply and (ii) if after the Call Right is exercised, the stated Expiration Date
of this Warrant would occur prior to the Forced Exercise Date, the “Expiration
Date” hereof shall be extended to end of the Forced Exercise Date solely to the
extent necessary to enable this Warrant to be exercised for the Call Amount on
the Forced Exercise Date.


15.           Warrant
Agent.  The Company shall serve as
warrant agent under this Warrant.  Upon
30 days’ notice to the Holder, the Company may appoint a new warrant
agent.  Any corporation into which the
Company or any new warrant agent may be merged or any corporation resulting
from any consolidation to which the Company or any new warrant agent shall be a
party or any corporation to which the Company or any new warrant agent
transfers substantially all of its corporate trust or stockholders services
business shall be a successor warrant agent under this Warrant without any
further act.  Any such successor warrant
agent shall promptly cause notice of its succession as warrant agent to be
mailed (by first class mail, postage prepaid) to the Holder at the Holder’s
last address as shown on the Warrant Register.


16.           Miscellaneous.


(a)           Subject to the restrictions on transfer
set forth on the first page hereof, this Warrant may be assigned by the
Holder.  This Warrant may not be assigned
by the Company except to a successor in the event of a Fundamental
Transaction.  This Warrant shall be
binding on and inure to the benefit of the parties hereto and their respective
successors and assigns.  Subject to the
preceding sentence, nothing in this Warrant shall be construed to give to any
Person other than the Company and the Holder any legal or equitable right,
remedy or cause of action under this Warrant. 
This Warrant may be amended only in writing signed by the Company and
the Holder and their successors and assigns.


(b)           The Company will not, by amendment of
its governing documents or through any reorganization, transfer of assets,
consolidation, merger, dissolution, issue or sale of securities or any other
voluntary action, avoid or seek to avoid the observance or performance of any
of the terms of this Warrant, but will at all times in good faith assist in the
carrying out of all such terms and in the taking of all such action as may be
necessary or appropriate in order to protect the rights of the Holder against
impairment.  Without limiting the
generality of the foregoing, the Company (i) will not increase the par value of
any Warrant Shares above the amount payable therefor on such exercise, (ii)
will take all such action as may be reasonably necessary or appropriate in
order that the Company may validly and legally issue fully paid and 



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nonassessable Warrant Shares on the exercise of this Warrant, and (iii)
will not close its stockholder books or records in any manner which interferes
with the timely exercise of this Warrant.


(C)           GOVERNING LAW; VENUE; WAIVER OF JURY
TRIAL.  ALL QUESTIONS CONCERNING THE
CONSTRUCTION, VALIDITY, ENFORCEMENT AND INTERPRETATION OF THIS WARRANT SHALL BE
GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF NEW YORK.  EACH PARTY HEREBY
IRREVOCABLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF THE STATE AND FEDERAL
COURTS SITTING IN THE CITY OF NEW YORK, BOROUGH OF MANHATTAN, FOR THE
ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION HEREWITH OR WITH ANY
TRANSACTION CONTEMPLATED HEREBY OR DISCUSSED HEREIN (INCLUDING WITH RESPECT TO
THE ENFORCEMENT OF ANY OF THE TRANSACTION DOCUMENTS), AND HEREBY IRREVOCABLY
WAIVES, AND AGREES NOT TO ASSERT IN ANY SUIT, ACTION OR PROCEEDING, ANY CLAIM
THAT IT IS NOT PERSONALLY SUBJECT TO THE JURISDICTION OF ANY SUCH COURT, THAT SUCH
SUIT, ACTION OR PROCEEDING IS IMPROPER. 
EACH PARTY HEREBY IRREVOCABLY WAIVES PERSONAL SERVICE OF PROCESS AND
CONSENTS TO PROCESS BEING SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING BY
MAILING A COPY THEREOF VIA REGISTERED OR CERTIFIED MAIL OR OVERNIGHT DELIVERY
(WITH EVIDENCE OF DELIVERY) TO SUCH PARTY AT THE ADDRESS IN EFFECT FOR NOTICES
TO IT UNDER THIS AGREEMENT AND AGREES THAT SUCH SERVICE SHALL CONSTITUTE GOOD
AND SUFFICIENT SERVICE OF PROCESS AND NOTICE THEREOF. NOTHING CONTAINED HEREIN
SHALL BE DEEMED TO LIMIT IN ANY WAY ANY RIGHT TO SERVE PROCESS IN ANY MANNER
PERMITTED BY LAW.  THE COMPANY HEREBY
WAIVES ALL RIGHTS TO A TRIAL BY JURY.


(d)           The headings herein are for convenience
only, do not constitute a part of this Warrant and shall not be deemed to limit
or affect any of the provisions hereof.


(e)           In case any one or more of the
provisions of this Warrant shall be invalid or unenforceable in any respect,
the validity and enforceability of the remaining terms and provisions of this
Warrant shall not in any way be affected or impaired thereby and the parties
will attempt in good faith to agree upon a valid and enforceable provision
which shall be a commercially reasonable substitute therefor, and upon so
agreeing, shall incorporate such substitute provision in this Warrant.


[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK,

SIGNATURE PAGE FOLLOWS]



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IN WITNESS WHEREOF, the Company has caused this
Warrant A to be duly executed by its authorized officer as of the date first
indicated above.


	
   

  	
   

  
	
   

  	
  SATCON TECHNOLOGY CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:                                                                                          

  
	
   

  	
  Name:  David
  B. Eisenhaure

  
	
   

  	
  Title:  Chief
  Executive Officer

  
	
   

  	
   

  
	
   

  	
  By                                                                                           

  
	
   

  	
  Name:  David
  E. O’Neil

  
	
   

  	
  Title:  Vice
  President of Finance and Treasurer

  



 


 



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Annex A


FORM OF EXERCISE NOTICE


(To be executed by the Holder to exercise the right to
purchase shares of Common Stock under the foregoing Warrant)


To:  SATCON
TECHNOLOGY CORPORATION


The undersigned is the Holder of Warrant A No. _______
(the “Warrant”) issued by SatCon
Technology Corporation, a Delaware corporation (the “Company”).  Capitalized
terms used herein and not otherwise defined have the respective meanings set
forth in the Warrant.


1.                               The Warrant is currently
exercisable to purchase a total of ______________ Warrant Shares.


2.                               The undersigned Holder
hereby exercises its right to purchase _________________ Warrant Shares
pursuant to the Warrant.


3.                               The Holder intends that
payment of the Exercise Price shall be made as (check one):


____       “Cash Exercise” under Section 10


____       “Cashless Exercise” under Section 10 (if
permitted)


4.                               If the holder has elected a
Cash Exercise, the holder shall pay the sum of $____________ to the Company in
accordance with the terms of the Warrant.


5.                               Pursuant to this exercise,
the Company shall deliver to the holder _______________ Warrant Shares in
accordance with the terms of the Warrant.


6.                               Following this exercise, the
Warrant shall be exercisable to purchase a total of ______________ Warrant Shares.


	
  

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Dated: ________________,
  ___

  	
   

  	
  Name of Holder:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (Print)   _____________________________

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:   ________________________________

  
	
   

  	
   

  	
  Name:   ______________________________

  
	
   

  	
   

  	
  Title:   _______________________________

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (Signature must conform in all respects to name of
  holder as specified on the face of the Warrant)

  



 









 



Annex B


FORM OF ASSIGNMENT


[To be completed and signed only upon transfer of
Warrant]


FOR VALUE RECEIVED, the undersigned hereby sells,
assigns and transfers unto ________________________________ the right
represented by the within Warrant to purchase 
____________ shares of Common Stock of SatCon Technology Corporation to
which the within Warrant relates and appoints ________________ attorney to
transfer said right on the books of SatCon Technology Corporation with full
power of substitution in the premises.


	
  Dated:  _________________, _____

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (Signature must conform in all respects to name of
  holder as specified on the face of the Warrant)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Address of Transferee

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  In the presence
  of: