Document:

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                                                                     EXHIBIT 4.3

                                    EXHIBIT C

                                 FORM OF WARRANT

[THE FOLLOWING PARAGRAPH SHALL APPEAR ON THE FACE OF EACH RESTRICTED WARRANT:]

THE SECURITIES REPRESENTED BY THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR APPLICABLE STATE
SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED
OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE
SECURITIES UNDER THE SECURITIES ACT OR APPLICABLE STATE SECURITIES LAWS OR AN
EXEMPTION THEREFROM. THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA
FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY THE SECURITIES.

[THE COMPANY SHALL PLACE THE FOLLOWING PARAGRAPH ON THE FACE OF ANY WARRANT HELD
BY OR TRANSFERRED TO AN "AFFILIATE" (AS DEFINED IN RULE 501(B) OF REGULATION D
UNDER THE SECURITIES ACT) OF THE COMPANY:]

THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE HELD BY A PERSON WHO MAY BE
DEEMED TO BE AN AFFILIATE OF THE ISSUER FOR PURPOSES OF RULE 144 PROMULGATED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND MAY BE
SOLD ONLY IN COMPLIANCE WITH RULE 144, PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO A VALID EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT.

                                ELECTROGLAS, INC.

                        WARRANT TO PURCHASE COMMON STOCK

Warrant No.:  [     ]                                  Number of Shares: [     ]
CUSIP No.:    285324117                                (subject to adjustment)

Date of Issuance:  June 21, 2002

            ELECTROGLAS, INC., a Delaware corporation (the "Company"), hereby
certifies that, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, [____________], the registered holder hereof
or its permitted assigns, is entitled, subject to the terms and conditions set
forth below, to purchase from the Company upon surrender of this Warrant (as
defined below), at any time or times on or after the date hereof, but not after
5:00

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p.m., Eastern Time, on the Expiration Date (as defined below), [______________]
fully paid nonassessable shares of Common Stock (as defined below) of the
Company at the Exercise Price per share provided in Section 1(c) of this
Warrant, subject to adjustment as provided below. Capitalized terms used herein
but not defined shall have the same meanings assigned to them in the Securities
Purchase Agreement dated as of June 19, 2002, by and between the Company and the
parties listed on the Schedule of Buyers attached thereto as Exhibit A (as such
agreement may be amended, supplemented and modified from time to time as
provided in such agreement, the "Securities Purchase Agreement").

      This Warrant (as defined below) is one of a series of Warrants issued in
connection with the transactions described in that certain (i) Securities
Purchase Agreement, (ii) the Company's 5.25% Convertible Subordinated Note Due
2007 (the "Note") issued pursuant to the Securities Purchase Agreement to the
holder hereof, and (iii) certain other related documents and agreements
including, without limitation, the Transaction Documents (as defined in the
Securities Purchase Agreement). The Warrant Shares (as defined below) issued
upon exercise of this Warrant and the holder hereof and thereof shall be
entitled to all of the rights and privileges set forth in the Transaction
Documents.

SECTION 1. DEFINITIONS. The following terms as used in this Warrant shall have
the following meanings:

      (a) "Business Day" means any day other than Saturday, Sunday or other day
on which commercial banks in The City of New York are required by law to remain
closed.

      (b) "Common Stock" means (i) the common stock, $0.01 par value per share,
of the Company, and (ii) any capital stock into which such Common Stock shall
have been changed or any capital stock resulting from a reclassification of such
Common Stock.

      (c) "Exercise Price" shall be equal to $15.4440, subject to further
adjustment as hereinafter provided.

      (d) "Expiration Date" means June 15, 2007 or, if such date does not fall
on a Business Day or on a Trading Day, then the next Business Day.

      (e) "Person" means an individual, a limited liability company, a
partnership, a joint venture, a corporation, a trust, an unincorporated
organization or association and a government or any department or agency
thereof.

      (f) "Principal Market" means The Nasdaq National Market ("NASDAQ") or if
the Common Stock is not traded on NASDAQ, then the principal securities exchange
or trading market for the Common Stock.

      (g) "Registration Rights Agreement" means that certain Registration Rights
Agreement, dated as of June 19, 2002, among the Company, Robertson and the
initial purchasers of the Notes and the Warrants as such agreement may be
amended, supplemented and modified from time to time in a writing signed by all
of the signatories thereto.

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      (h) "Securities Act " means the Securities Act of 1933, as amended, and
the rules and regulations promulgated thereunder.

      (i) "Trading Day" shall mean (x) a day on which the Principal Market is
open for business or (y) if the applicable security is not so listed on a
Principal Market or admitted for trading or quotation, a Business Day.

      (j) "Warrant" means this Warrant and the other warrants to purchase shares
of Common Stock issued pursuant to the Securities Purchase Agreement and all
warrants issued in exchange, transfer or replacement thereof.

      (k) "Warrant Shares" means all shares of Common Stock issuable upon
exercise of the Warrants.

SECTION 2. EXERCISE OF WARRANT.

      (a) Subject to the terms and conditions hereof, including the early
termination of this Warrant pursuant to Section 3(b) of this Warrant, this
Warrant may be exercised by the holder hereof then registered on the books of
the Company, in whole or in part, at any time on any Business Day on or after
the opening of business on the date hereof and prior to 5:00 p.m., Eastern Time,
on the Expiration Date by (i) delivery of a written notice, in the form of the
subscription notice attached as Exhibit A hereto or a reasonable facsimile
thereof (the "Exercise Notice"), to the Company and the Company's designated
transfer agent (the "Transfer Agent"), of such holder's election to exercise all
or a portion of this Warrant, which notice shall specify the number of Warrant
Shares to be purchased, (ii) (A) payment to the Company of an amount equal to
the Exercise Price multiplied by the number of Warrant Shares as to which this
Warrant is being exercised (the "Aggregate Exercise Price") in cash or delivery
of a certified check or bank draft payable to the order of the Company or wire
transfer of immediately available funds or (B) notification to the Company that
this Warrant is being exercised pursuant to a Cashless Exercise (as defined in
Section 2(e) of this Warrant), and (iii) the surrender of this Warrant to a
common carrier for overnight delivery to the Company as soon as practicable
following such date (or an indemnification undertaking or other form of security
reasonably satisfactory to the Company with respect to this Warrant in the case
of its loss, theft or destruction); provided, however, that if such Warrant
Shares are to be issued in any name other than that of the registered holder of
this Warrant, such issuance shall be deemed a transfer and the provisions of
Section 8 of this Warrant shall be applicable. In the event of any exercise of
the rights represented by this Warrant in compliance with this Section 2(a), the
Company shall use its best efforts on or before the third Business Day, but in
no event later than the fifth Business Day (the "Warrant Share Delivery Date")
following the date of its receipt of the Exercise Notice, the Aggregate Exercise
Price (or notice of Cashless Exercise) and this Warrant (or an indemnification
undertaking or other form of security reasonably satisfactory to the Company
with respect to this Warrant in the case of its loss, theft or destruction) (the
"Exercise Delivery Documents"), (A) in the case of a public resale of such
Warrant Shares, at the holder's request, credit such aggregate number of shares
of Common Stock to which the holder shall be entitled to the holder's or its
designee's balance account with the Company's designated registrar (the
"Registrar") through its Deposit Withdrawal Agent Commission system or (B) issue
and deliver to the address as specified in the

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Exercise Notice, a certificate or certificates in such denominations as may be
requested by the holder in the Exercise Notice, registered in the name of the
holder or its designee, for the number of shares of Common Stock to which the
holder shall be entitled upon such exercise. Upon delivery of the Exercise
Notice, this Warrant and Aggregate Exercise Price referred to in clause (ii)(A)
above or notification to the Company of a Cashless Exercise referred to in
Section 2(e) of this Warrant, the holder of this Warrant shall be deemed for all
corporate purposes to have become the holder of record of the Warrant Shares
with respect to which this Warrant has been exercised, irrespective of the date
of delivery of this Warrant as required by clause (iii) above or the
certificates evidencing such Warrant Shares. In the case of a dispute as to the
determination of the Exercise Price or the arithmetic calculation of the number
of Warrant Shares, the Company shall promptly issue to the holder the number of
shares of Common Stock that is not disputed and shall submit the disputed
determination or arithmetic calculation to the holder via facsimile within two
(2) Business Days after receipt of the holder's Exercise Notice. If the holder
and the Company are unable to agree upon the determination of the Exercise Price
or arithmetic calculation of the number of Warrant Shares within two (2)
Business Days of such disputed determination or arithmetic calculation being
submitted to the holder, then the Company shall immediately submit via facsimile
(i) the disputed determination of the Exercise Price or the Closing Sale Price
(as defined in Section 9(f) of this Warrant) to an independent, reputable
investment banking firm selected jointly by the Company and the holder or (ii)
the disputed arithmetic calculation of the number of Warrant Shares to its
independent, outside auditor. The Company shall cause the investment banking
firm or the auditor, as the case may be, to perform the determination or
calculation and notify the Company and the holder of the results no later than
ten (10) Business Days from the time it receives the disputed determination or
calculation. Such investment banking firm's or auditor's determination or
calculation, as the case may be, shall be deemed conclusive absent manifest
error. All fees and expenses of such determinations shall be borne solely by the
Company.

      (b) Unless the rights represented by this Warrant shall have expired or
shall have been fully exercised, the Company shall, as soon as practicable but
in no event later than five (5) Business Days after any exercise (the "Warrant
Delivery Date") and at its own expense, issue a new Warrant identical in all
respects to this Warrant exercised except it shall represent rights to purchase
the number of Warrant Shares purchasable immediately prior to such exercise
under this Warrant, less the number of Warrant Shares with respect to which this
Warrant is exercised.

      (c) Notwithstanding anything contained in this Warrant to the contrary,
the Company shall not be required to issue fractions of shares of Common Stock
upon exercise of this Warrant or to distribute certificates which evidence such
fractional shares. If more than one Warrant shall be presented for exercise in
full at the same time by the same holder, the number of full shares of Common
Stock which shall be issuable upon the exercise thereof shall be computed on the
basis of the aggregate number of shares of Common Stock purchasable on exercise
of all Warrants so presented. In lieu of any fractional shares, there shall be
paid to the holder an amount of cash equal to the same fraction of the current
market value of a share of Common Stock. For purposes of this Section 2(c) of
this Warrant, the current market value of a share of Common Stock shall be the
Closing Sale Price of a share of Common Stock for the Trading Day immediately
prior to the date of such exercise or if not listed on a Principal Market, then
as determined by the holders of Warrants

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representing a majority of the shares of Common Stock issuable upon exercise of
all of the Warrants then outstanding.

      (d) If the Company shall fail for any reason or for no reason (except in
the case of a dispute as to the Exercise Price or the Closing Sale Price which
is being resolved in accordance with Section 2(a) of this Warrant) to issue to
the holder within five (5) Business Days of receipt of the Exercise Delivery
Documents, a certificate for the number of shares of Common Stock to which the
holder is entitled or to credit the holder's or its designee's balance account
with the Registrar, in accordance with Section 2 of this Warrant, for such
number of shares of Common Stock to which the holder is entitled upon the
holder's exercise of this Warrant or a new Warrant for the number of shares of
Common Stock to which such holder is entitled pursuant to Section 2(b) of this
Warrant, the Company shall, in addition to any other remedies under this Warrant
or the Securities Purchase Agreement or otherwise available to such holder,
including any indemnification under Section 8 of the Securities Purchase
Agreement, pay as additional damages in cash to such holder on each day after
the Warrant Share Delivery Date if such exercise is not timely effected and/or
each day after the Warrant Delivery Date if such Warrant is not delivered, as
the case may be, in an amount equal to one-half percent (0.5%) per month
multiplied by the product of (I) the sum of the number of shares of Common Stock
not issued to the holder on or prior to the Warrant Share Delivery Date and to
which such holder is entitled and, in the event the Company has failed to
deliver a Warrant to the holder on or prior to the Warrant Delivery Date and to
which such holder is entitled, the number of shares of Common Stock issuable
upon exercise of the Warrant as of the Warrant Delivery Date and (II) the
Closing Sale Price of the Common Stock on the Warrant Share Delivery Date, in
the case of failure to deliver Common Stock, or on the Warrant Delivery Date, in
the case of failure to deliver a Warrant, provided that if the Common Stock is
not listed on a Principal Market, then the Closing Sale Price shall be as
determined in good faith by a majority of the Company's Board of Directors,
whose determination shall be final, binding and conclusive.

      (e) Notwithstanding anything contained herein to the contrary, the holder
of this Warrant may, at its election exercised in its sole discretion, exercise
this Warrant as to all or a portion of the Warrant Shares and, in lieu of making
the cash payment otherwise contemplated to be made to the Company upon such
exercise in payment of the Aggregate Exercise Price, elect instead to receive
upon such exercise the "Net Number" of shares of Common Stock determined
according to the following formula (a "Cashless Exercise"):

                      Net Number = (A x B) - (A x C)
                                   -----------------
                                             B

      For purposes of the foregoing formula:

            A=    the total number of shares with respect to which this Warrant
                  is then being exercised.

            B=    the Closing Sale Price of the Common Stock on the Trading Day
                  immediately preceding the date of the Exercise Notice.

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            C=    the Exercise Price then in effect for the applicable Warrant
                  Shares at the time of such exercise.

SECTION 3. DATE; DURATION; EARLY TERMINATION OF WARRANTS.

      (a) The date of this Warrant is June 21, 2002 (the "Warrant Date"). This
Warrant, in all events, shall be wholly void and of no effect at 5:00 pm,
Eastern Time, on the Expiration Date, or the Termination Date (as defined
below), if applicable, as the case may be, except that notwithstanding any other
provisions hereof, the provisions of Section 8(c) of this Warrant shall continue
in full force and effect after such date as to any Warrant Shares or other
securities issued upon the exercise of this Warrant.

      (b) At any time after June 21, 2005, if (1) the Closing Sale Price per
share of the Common Stock has exceeded 175% of the Exercise Price then in effect
for any fifteen (15) Trading Days within a period of twenty (20) consecutive
Trading Days (the "Determination Period") and (2) a shelf registration statement
covering resales of the Common Stock issuable upon exercise of the Warrants is
effective and available for use at all times during the period beginning thirty
(30) days prior to the Notice Date (as defined below) and ending on the
Termination Date, and is expected to remain effective and available for use
until at least the earlier of thirty (30) days following the Termination Date or
the last date on which the shelf registration statement is required to be kept
effective under the terms of the Registration Rights Agreement, then the Company
may, at its option, terminate the Warrants. By following the procedures set
forth below, the Company may exercise this right of termination only if, within
ten (10) days following the Determination Period, the Company shall mail or
cause to be mailed a notice of such termination (the "Termination Notice," and
the date such Termination Notice is mailed, the "Notice Date") to the holders of
the Warrant at the address set forth for such holder in Section 12 of this
Warrant. Such mailing shall be by first class mail and the Company shall
contemporaneously issue a press release through PRNewswire or Bloomberg
Financial Markets containing substantially the same information as the
Termination Notice described below. Each Termination Notice shall specify the
CUSIP number of the Warrant, the Termination Date, that the Warrants may not be
exercised after 5:00 p.m., Eastern Time, on the Termination Date and the current
Exercise Price.

      If all of the conditions described in the preceding paragraph have been
met and if no Event of Default (as that term is defined in the Indenture) shall
have occurred and be continuing under the Indenture, dated as of June 21, 2002
between the Company and The Bank of New York, as trustee (the "Indenture"), any
Warrant not exercised before the close of business on the ninetieth (90th) day
after the mailing date of the Termination Notice (such ninetieth (90th) day, the
"Termination Date") shall automatically be deemed exercised in accordance with
Section 2(e) of this Warrant and the Company will deliver the Warrant Shares to
the holder upon receipt of a completed Exercise Notice along with the original
copy of the Warrant for cancellation (or an affidavit of lost Warrant in
accordance with Section 11).

SECTION 4. COVENANTS AS TO COMMON STOCK. The Company hereby covenants and agrees
as follows:

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      (a) Issuance of Warrants and Warrant Shares. This Warrant is, and any
Warrants issued in substitution for or replacement of this Warrant will, upon
issuance, be, validly issued, fully paid and non-assessable and free from all
taxes, liens and charges with respect to the issuance thereof, and shall not be
subject to preemptive rights or other similar rights of stockholders of the
Company. All Warrant Shares which may be issued upon the exercise of the rights
represented by this Warrant will, upon issuance and payment hereof or cashless
exercise in accordance with the terms hereof, be validly issued, fully paid and
nonassessable and free from all taxes, liens and charges created by or through
the Company with respect to the issue thereof, with the holders being entitled
to all rights accorded to a holder of Common Stock.

      (b) Reservation of Shares. During the period within which the rights
represented by this Warrant may be exercised, the Company will take all actions
reasonably necessary to at all times have authorized, and reserved for the
purpose of issuance, no less than one hundred five percent (105%) of the number
of shares of Common Stock needed to provide for the issuance of the Warrant
Shares upon exercise of all of the Warrants without regard to any limitations on
conversions or exercise.

      (c) Listing. The Company shall promptly use reasonable efforts to secure
the listing of the shares of Common Stock issuable upon exercise of this Warrant
upon each national securities exchange and automated quotation system, if any,
upon which shares of Common Stock are then listed (subject to official notice of
issuance upon exercise of this Warrant) and shall use reasonable efforts to
maintain, so long as any other shares of Common Stock shall be so listed, such
listing of all shares of Common Stock issuable from time to time upon the
exercise of this Warrant; and the Company shall use reasonable efforts to list
on the Principal Market or automated quotation system, as the case may be, and
shall use reasonable efforts to maintain such listing of, any other shares of
capital stock of the Company issuable upon the exercise of this Warrant if and
so long as any shares of the same class shall be listed on such Principal Market
or automated quotation system. The Company shall pay all fees and expenses in
connection with satisfying its obligations under this Section 4(c).

      (d) Certain Actions. The Company will not, by amendment of its certificate
of incorporation 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 to be observed or performed by it hereunder. Without limiting the
generality of the foregoing, the Company (i) will not increase the par value of
any shares of Common Stock issuable upon the exercise of this Warrant above the
Exercise Price then in effect, (ii) will take all such actions as may be
reasonably necessary or appropriate in order that the Company may validly and
legally issue fully paid and nonassessable shares of Common Stock upon the
exercise of this Warrant and (iii) will not take any action which results in any
adjustment of the Exercise Price if the total number of shares of Common Stock
issuable after the action upon the exercise of all of the Warrants would exceed
the total number of shares of Common Stock then authorized by the Company's
certificate of incorporation and available for the purpose of issue upon such
exercise.

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      (e) Obligations Binding on Successors. This Warrant will be binding upon
any entity succeeding to the Company in one or a series of transactions by
merger, consolidation or acquisition of all or substantially all of the
Company's assets or other similar transactions.

SECTION 5. TAXES.

      (a) The Company shall pay any and all documentary, stamp, transfer and
other similar taxes which may be payable with respect to the issuance and
delivery of Warrant Shares upon exercise of this Warrant.

      (b) Notwithstanding any other provision of this Warrant or any other
Transaction Document, for income tax purposes, any assignee or transferee shall
agree that the Company and the Transfer Agent shall be permitted to withhold
from any amounts payable to such assignee or transferee any taxes required by
law to be withheld from such amounts. Unless exempt from the obligation to do
so, each assignee or transferee shall execute and deliver to the Company or the
Transfer Agent, as applicable, a properly completed Form W-8 or W-9, indicating
that such assignee or transferee is not subject to back-up withholding for
United States Federal income tax purposes. Each assignee or transferee that does
not deliver such a form pursuant to the preceding sentence shall have the burden
of proving to the Company's reasonable satisfaction that it is exempt from such
requirement.

SECTION 6. WARRANT HOLDER NOT DEEMED A STOCKHOLDER. Except as otherwise
specifically provided herein, prior to the exercise of the Warrants represented
hereby, the holder of this Warrant shall not be entitled, as such, to any rights
of a stockholder of the Company, including, without limitation, the right to
vote or to consent to any action of the stockholders of the Company, to receive
dividends or other distributions, to exercise any preemptive right or to receive
dividends or other distributions, to exercise any preemptive right or to receive
any notice of meetings of stockholders of the Company, and shall not be entitled
to receive any notice of any proceedings of the Company. In addition, nothing
contained in this Warrant shall be construed as imposing any liabilities on such
holder to purchase any securities (upon exercise of this Warrant or otherwise)
or as a stockholder of the Company, whether such liabilities are asserted by the
Company or by creditors of the Company.

SECTION 7. COMPLIANCE WITH SECURITIES LAWS.

      (a) The holder of this Warrant, by the acceptance hereof, represents and
warrants that (i) it is acquiring this Warrant and (ii) upon exercise of this
Warrant will acquire the Warrant Shares then issuable upon exercise thereof for
its own account for investment only and not with a view towards, or for resale
in connection with, the public sale or distribution thereof, except pursuant to
sales registered or exempted from registration under the Securities Act;
provided, however, that by making the representations herein, the holder does
not agree to hold this Warrant or any of the Warrant Shares for any minimum or
other specific term and reserves the right to dispose of this Warrant and the
Warrant Shares at any time in accordance with or pursuant to a registration
statement or an exemption under the Securities Act. The holder of this Warrant
further represents, by acceptance hereof, that, as of this date, such holder is
an "accredited investor" as such term is defined in Rule 501(a) of Regulation D
promulgated by the Securities and Exchange Commission

                                      -8-
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under the Securities Act and was not organized for the specific purpose of
acquiring the Warrants or Warrant Shares.

      (b) This Warrant and all the Warrant Shares issued upon exercise hereof or
conversion thereof shall be stamped or imprinted with a legend in substantially
the following form (in addition to any legend required by state securities laws
or any securities exchange upon which such Warrant Shares may, at the time of
such exercise, be listed) on the face thereof unless at the time of exercise
such Warrant Shares shall be registered under the Securities Act:

      THE SECURITIES REPRESENTED BY THIS WARRANT HAVE NOT BEEN REGISTERED UNDER
      THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR
      APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR
      SALE, SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE
      REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OR
      APPLICABLE STATE SECURITIES LAWS OR AN EXEMPTION THEREFROM. THE SECURITIES
      MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN
      SECURED BY THE SECURITIES.

      In addition, any Warrants or Warrant Shares held by or transferred to an
"affiliate" (as defined in Rule 501(b) of Regulation D under the Securities Act)
of the Company shall be stamped or imprinted with a legend substantially in the
following form:

      THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE HELD BY A PERSON WHO
      MAY BE DEEMED TO BE AN AFFILIATE OF THE ISSUER FOR PURPOSES OF RULE 144
      PROMULGATED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
      ACT"), AND MAY BE SOLD ONLY IN COMPLIANCE WITH RULE 144, PURSUANT TO AN
      EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO A
      VALID EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT.

      The legends set forth above shall be removed and the Company (in the case
of Warrants) or the Transfer Agent (in the case of Warrant Shares) shall issue a
new Warrant or Warrant(s) of like tenor and aggregate principal amount, or a
certificate or certificates representing Warrant Shares, as appropriate, without
such legends to the holder of the Warrant(s) or Warrant Shares upon which they
are stamped, (i) if such Warrant(s) or Warrant Shares are registered for resale
under the Securities Act and are transferred or sold pursuant to such
registration, (ii) if, pursuant to a sale transaction, such holder provides the
Company with an opinion of counsel reasonably acceptable to the Company to the
effect that a public sale, assignment or transfer of the Warrant(s) or Warrant
Shares may be made without registration under the Securities Act, or (iii) if
the holder of the Securities has not been an "affiliate" (as defined in Rule
501(b) of Regulation D under the Securities Act) during the preceding three (3)
months, upon expiration of the two- (2) year period under Rule 144(k)
promulgated under the Securities Act (or any successor rule). In the event Rule
144(k) (or any successor rule) is amended to change the two- (2) year or three-
(3) month periods, the reference(s) in the preceding sentence shall be deemed to
be a reference to such changed period(s), provided that

                                      -9-
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such change shall not become effective if it is otherwise prohibited by, or
would otherwise cause a violation of, the then applicable federal securities
laws. The Company shall not require such opinion of counsel for the sale of
Warrant(s) or Warrant Shares in accordance with Rule 144 of the Securities Act,
provided the seller provides such representations that the Company shall
reasonably request confirming compliance with the requirements of Rule 144.

SECTION 8. OWNERSHIP AND TRANSFER.

      (a) The Company shall maintain at its principal executive offices (or such
other office or agency of the Company as it may designate by notice to the
holder hereof), a register for this Warrant (the "Warrant Register"), in which
the Company shall record the name and address of the Person in whose name this
Warrant has been issued, as well as the name and address of each transferee. The
Company may treat the Person in whose name any Warrant is registered on the
Warrant Register as the owner and holder thereof for all purposes,
notwithstanding any notice to the contrary, but in all events recognizing any
transfers made in accordance with the terms of this Warrant.

      (b) This Warrant and all rights hereunder shall be assignable and
transferable by the holder hereof without the consent of the Company upon
surrender of this Warrant with a properly executed assignment (in the form of
Exhibit B attached hereto) at the principal executive offices of the Company (or
such other office or agency of the Company as it may designate in writing to the
holder hereof).

      (c) The Company is obligated to register all of the Warrants and the
Warrant Shares for resale under the Securities Act pursuant to the Registration
Rights Agreement. The Warrants and the shares of Common Stock issuable upon
exercise of this Warrant shall constitute Registrable Securities (as such term
is defined in the Registration Rights Agreement). Each holder of this Warrant
shall be entitled to all of the benefits afforded to a holder of any such
Registrable Securities under the Registration Rights Agreement and such holder,
by its acceptance of this Warrant, agrees and shall agree to be bound by and to
comply with the terms and conditions of the Registration Rights Agreement
applicable to such holder as a holder of such Registrable Securities.

SECTION 9. ADJUSTMENT OF EXERCISE PRICE AND NUMBER OF SHARES ISSUABLE. The
Exercise Price, the number of Warrant Shares issuable upon the exercise of each
Warrant and the number of Warrants outstanding are subject to adjustment from
time to time upon the occurrence of the events enumerated in this Section 9.

      (a) In case the Company shall hereafter pay a dividend or make a
distribution to all holders of the outstanding Common Stock in shares of Common
Stock, the Exercise Price in effect at the opening of business on the date
following the date fixed for the determination of stockholders entitled to
receive such dividend or other distribution shall be reduced by multiplying such
Exercise Price by a fraction of which (i) the numerator shall be the number of
shares of Common Stock outstanding at the close of business on the Record Date
(as defined in Section 9(f) of this Warrant) fixed for such determination and
(ii) the denominator shall be the sum of such number of shares and the total
number of shares constituting such dividend or other distribution, such
reduction in the

                                      -10-
<PAGE>

Exercise Price to become effective immediately after the opening of business on
the day following the Record Date. If any dividend or distribution of the type
described in this Section 9(a) of this Warrant is declared but not so paid or
made, the Exercise Price shall again be adjusted to the Exercise Price which
would then be in effect if such dividend or distribution had not been declared.

      (b) In case the outstanding shares of Common Stock shall be subdivided
into a greater number of shares of Common Stock, the Exercise Price in effect at
the opening of business on the day following the day upon which such subdivision
becomes effective shall be proportionately reduced, and conversely, in case
outstanding shares of Common Stock shall be combined into a smaller number of
shares of Common Stock, the Exercise Price in effect at the opening of business
on the day following the day upon which such combination becomes effective shall
be proportionately increased, such reduction or increase, as the case may be, to
become effective immediately after the opening of business on the day following
the day upon which such subdivision or combination becomes effective.

      (c) In case the Company shall issue rights or warrants to all holders of
its outstanding shares of Common Stock entitling them to subscribe for or
purchase shares of Common Stock at a price per share less than the Current
Market Price (as defined in Section 9(f) of this Warrant) on the Record Date
fixed for the determination of stockholders entitled to receive such rights or
warrants, the Exercise Price shall be adjusted so that the same shall equal the
price determined by multiplying the Exercise Price in effect at the opening of
business on the date after such Record Date by a fraction (i) the numerator of
which shall be the sum of the number of shares of Common Stock outstanding at
the close of business on the Record Date plus the number of shares that the
aggregate offering price of the total number of shares so offered for
subscription or purchase would purchase at such Current Market Price and (ii)
the denominator of which shall be the sum of the number of shares of Common
Stock outstanding at the close of business on the Record Date plus the total
number of additional shares of Common Stock so offered for subscription or
purchase. Such adjustment shall become effective immediately after the opening
of business on the day following the Record Date fixed for determination of
stockholders entitled to receive such rights or warrants. To the extent that
shares of Common Stock are not delivered pursuant to such rights or warrants,
upon the expiration or termination of such rights or warrants, the Exercise
Price shall be readjusted to the Exercise Price that would then be in effect had
the adjustments made upon the issuance of such rights or warrants been made on
the basis of delivery of only the number of shares of Common Stock actually
delivered. In the event that such rights or warrants are not so issued, the
Exercise Price shall again be adjusted to be the Exercise Price that would then
be in effect if such date fixed for the determination of stockholders entitled
to receive such rights or warrants had not been fixed. In determining whether
any rights or warrants entitle the holders to subscribe for or purchase shares
of Common Stock at less than the Current Market Price, and in determining the
aggregate offering price of such shares of Common Stock, there shall be taken
into account any consideration received for such rights or warrants, the value
of such consideration, if other than cash, to be determined in good faith by the
Company's Board of Directors.

      (d) In case the Company shall, by dividend or otherwise, distribute to all
holders of its Common Stock shares of any class of capital stock of the Company
(other than any dividends or

                                      -11-
<PAGE>

distributions to which Section 9(a) of this Warrant applies) or evidences of its
indebtedness or other assets (including securities, but excluding (1) any rights
or warrants referred to in Section 9(c) of this Warrant and (2) dividends and
distributions paid exclusively in cash (except as set forth in Sections 9(e) and
9(f) of this Warrant, (the foregoing hereinafter in this Section 9(d) called the
"Securities")), unless the Company elects to reserve such Securities for
distribution to the holders upon exercise of the Warrants so that any such
holder converting Warrants will receive upon such exercise, in addition to the
shares of Common Stock to which such holder is entitled, the amount and kind of
such Securities which such holder would have received if such holder had
exercised its Warrants into Common Stock immediately prior to the Record Date
for such distribution of the Securities, then, in each such case, the Exercise
Price shall be reduced so that the same shall be equal to the price determined
by multiplying the Exercise Price in effect immediately prior to the close of
business on the Record Date with respect to such distribution by a fraction the
numerator of which shall be the Current Market Price (as defined in Section 9(f)
of this Warrant) on such date less the fair market value (as determined in good
faith by the Company's Board of Directors, whose determination shall be
conclusive) on such date of the portion of the Securities so distributed
applicable to one share of Common Stock and the denominator of which shall be
such Current Market Price, such reduction to become effective immediately prior
to the opening of business on the day following the Record Date; provided,
however, that in the event the then fair market value (as determined in good
faith by the Company's Board of Directors, whose determination shall be
conclusive) of the portion of the Securities so distributed applicable to one
share of Common Stock is equal to or greater than the Current Market Price on
the Record Date, in lieu of the foregoing adjustment, adequate provision shall
be made so that each holder shall have the right to receive upon conversion of a
Warrant (or any portion thereof) the amount of Securities such holder would have
received had such holder converted such Warrant (or portion thereof) immediately
prior to such Record Date.

      In the event that such dividend or distribution is not so paid or made,
the Exercise Price shall again be adjusted to be the Exercise Price which would
then be in effect if such dividend or distribution had not been declared. If a
majority of the independent members of the Company's Board of Directors
determines the fair market value of any distribution for purposes of this
Section 9(d) by reference to the actual or when issued trading market for any
securities comprising all or part of such distribution, it must in doing so
consider the prices in such market over the same period (the "Reference Period")
used in computing the Current Market Price pursuant to Section 9(f) of this
Warrant to the extent possible, unless a majority of the independent members of
the Company's Board of Directors determines in good faith that determining the
fair market value during the Reference Period would not be in the best interest
of the holders.

      In the event that the Company implements a new stockholder rights plan,
such rights plan shall provide that upon exercise of the Warrants the holders
will receive, in addition to the Common Stock issuable upon such exercise, the
rights issued under such rights plan (as if the holder had exercised the Warrant
prior to implementing the rights plan and notwithstanding the occurrence of an
event causing such rights to separate from the Common Stock at or prior to the
time of exercise). Any distribution of rights or warrants pursuant to a
stockholder rights plan complying with the

                                      -12-
<PAGE>

requirements set forth in the immediately preceding sentence of this paragraph
shall not constitute a distribution of rights or warrants for the purposes of
this Section 9(d).

      Rights or warrants distributed by the Company to all holders of Common
Stock entitling the holders thereof to subscribe for or purchase shares of the
Company's capital stock (either initially or under certain circumstances), which
rights or warrants, until the occurrence of a specified event or events
("Trigger Event"), (i) are deemed to be transferred with such shares of Common
Stock, (ii) are not exercisable, and (iii) are also issued in respect of future
issuances of Common Stock, shall be deemed not to have been distributed for
purposes of this Section 9(d) (and no adjustment to the Exercise Price under
this Section 9(d) will be required) until the occurrence of the earliest Trigger
Event. If such right or warrant is subject to subsequent events, upon the
occurrence of which such right or warrant shall become exercisable to purchase
different securities, evidences of indebtedness or other assets or entitle the
holder to purchase a different number or amount of the foregoing or to purchase
any of the foregoing at a different purchase price, then the occurrence of each
such event shall be deemed to be the date of issuance and record date with
respect to a new right or warrant (and a termination or expiration of the
existing right or warrant without exercise by the holder thereof). In addition,
in the event of any distribution (or deemed distribution) of rights or warrants,
or any Trigger Event or other event (of the type described in the preceding
sentence) with respect thereto, that resulted in an adjustment to the Exercise
Price under this Section 9(d), (1) in the case of any such rights or warrants
that shall all have been redeemed or repurchased without exercise by any holders
thereof, the Exercise Price shall be readjusted upon such final redemption or
repurchase to give effect to such distribution or Trigger Event, as the case may
be, as though it were a cash distribution, equal to the per share redemption or
repurchase price received by a holder of Common Stock with respect to such
rights or warrants (assuming such holder had retained such rights or warrants),
made to all holders of Common Stock as of the date of such redemption or
repurchase, and (2) in the case of such rights or warrants all of which shall
have expired or been terminated without exercise, the Exercise Price shall be
readjusted as if such rights and warrants had never been issued.

      For purposes of this Section 9(d) and Sections 9(a) and (c) of this
Warrant, any dividend or distribution to which this Section 9(d) is applicable
that also includes shares of Common Stock, or rights or warrants to subscribe
for or purchase shares of Common Stock to which Section 9(a) or (c) of this
Warrant applies (or both), shall be deemed instead to be (1) a dividend or
distribution of the evidences of indebtedness, assets, shares of capital stock,
rights or warrants other than such shares of Common Stock or rights or warrants
to which Section 9(c) of this Warrant applies (and any Exercise Price reduction
required by this Section 9(e) with respect to such dividend or distribution
shall then be made) immediately followed by (2) a dividend or distribution of
such shares of Common Stock or such rights or warrants (and any further Exercise
Price reduction required by Sections 9(a) and (c) of this Warrant with respect
to such dividend or distribution shall then be made), except (A) the Record Date
of such dividend or distribution shall be substituted as "the date fixed for the
determination of stockholders entitled to receive such dividend or other
distribution," "Record Date fixed for such determination" and "Record Date"
within the meaning of Section 9(a) of this Warrant and as "the date fixed for
the determination of stockholders entitled to receive such rights or warrants,"
"the Record Date fixed for the determination of the stockholders

                                      -13-
<PAGE>

entitled to receive such rights or warrants" and "such Record Date" within the
meaning of Section 9(c) of this Warrant and (B) any shares of Common Stock
included in such dividend or distribution shall not be deemed "outstanding at
the close of business on the date fixed for such determination" within the
meaning of Section 9(a) of this Warrant.

      (e) In case the Company shall, by dividend or otherwise, distribute to all
holders of its Common Stock cash (excluding any cash that is distributed upon a
merger or consolidation to which Section 10 of this Warrant applies or as part
of a distribution referred to in Section 9(d) of this Warrant), in an aggregate
amount that, combined together with (1) the aggregate amount of any other such
distributions to all holders of its Common Stock made exclusively in cash within
the twelve (12) months preceding the date of payment of such distribution, and
in respect of which no adjustment pursuant to this Section 9(e) has been made,
and (2) the aggregate of any cash plus the fair market value (as determined in
good faith by the Company's Board of Directors, whose determination shall be
final, binding and conclusive) of consideration payable in respect of any tender
offer by the Company or any of its subsidiaries for all or any portion of the
Common Stock concluded within the twelve (12) months preceding the date of
payment of such distribution exceeds six percent (6%) of the product of the
Current Market Price (determined as provided in Section 9(f) of this Warrant) on
the Record Date with respect to such distribution times the number of shares of
Common Stock outstanding on such date, then, and in each such case, immediately
after the close of business on such date, the Exercise Price shall be reduced so
that the same shall equal the price determined by multiplying the Exercise Price
in effect immediately prior to the close of business on such Record Date by a
fraction (i) the numerator of which shall be equal to the Current Market Price
on the Record Date less an amount equal to the quotient of (x) such combined
amount and (y) the number of shares of Common Stock outstanding on the Record
Date and (ii) the denominator of which shall be equal to the Current Market
Price on such date; provided, however, that in the event the portion of the cash
so distributed applicable to one share of Common Stock is equal to or greater
than the Current Market Price of the Common Stock on the Record Date, in lieu of
the foregoing adjustment, adequate provision shall be made so that each holder
shall have the right to receive upon exercise of a Warrant (or any portion
thereof) the amount of cash such holder would have received had such holder
exercised such Warrant (or portion thereof) immediately prior to such Record
Date. In the event that such dividend or distribution is not so paid or made,
the Exercise Price shall again be adjusted to be the Exercise Price that would
then be in effect if such dividend or distribution had not been declared.

      (f) For purposes of this Section 9, the following terms shall have the
meanings indicated:

            (1) "Closing Sale Price" with respect to any securities on any day
shall mean the closing sale price regular way on such day or, in case no such
sale takes place on such day, the average of the reported closing bid and asked
prices, regular way, in each case on the Principal Market, or, if not quoted or
listed or admitted to trading on any national securities exchange or quotation
system, the average of the closing bid and asked prices of such security on the
over-the-counter market on the day in question as reported by the National
Quotation Bureau Incorporated, or a similar generally accepted reporting
service, or if not so available, in such manner as furnished by

                                      -14-
<PAGE>

any New York Stock Exchange member firm selected from time to time by the
Company's Board of Directors for that purpose, whose determination shall be
conclusive.

            (2) "Current Market Price" shall mean the average of the daily
Closing Sale Prices per share of Common Stock for the ten (10) consecutive
Trading Days immediately prior to the date in question; provided, however, that
(1) if the "ex" date (as hereinafter defined) for any event (other than the
issuance or distribution requiring such computation) that requires an adjustment
to the Exercise Price pursuant to Section 9(a), (b), (c), (d) or (e) of this
Warrant occurs during such ten (10) consecutive Trading Days, the Closing Sale
Price for each Trading Day prior to the "ex" date for such other event shall be
adjusted by multiplying such Closing Sale Price by the same fraction by which
the Exercise Price is so required to be adjusted as a result of such other
event, (2) if the "ex" date for any event (other than the issuance or
distribution requiring such computation) that requires an adjustment to the
Exercise Price pursuant to Section 9(a), (b), (c), (d) or (e) of this Warrant
occurs on or after the "ex" date for the issuance or distribution requiring such
computation and prior to the day in question, the Closing Sale Price for each
Trading Day on and after the "ex" date for such other event shall be adjusted by
multiplying such Closing Sale Price by the reciprocal of the fraction by which
the Exercise Price is so required to be adjusted as a result of such other
event, and (3) if the "ex" date for the issuance or distribution requiring such
computation is prior to the day in question, after taking into account any
adjustment required pursuant to clause (1) or (2) of this proviso, the Closing
Sale Price for each Trading Day on or after such "ex" date shall be adjusted by
adding thereto the amount of any cash and the fair market value (as determined
in good faith by the Company's Board of Directors in a manner consistent with
any determination of such value for purposes of Section 9(d) of this Warrant,
whose determination shall be conclusive) of the evidences of indebtedness,
shares of capital stock or assets being distributed applicable to one share of
Common Stock as of the close of business on the day before such "ex" date. For
purposes of this paragraph, the term "ex" date, (1) when used with respect to
any issuance or distribution, means the first date on which the Common Stock
trades regular way on the relevant exchange or in the relevant market from which
the Closing Sale Price was obtained without the right to receive such issuance
or distribution and (2) when used with respect to any subdivision or combination
of shares of Common Stock, means the first date on which the Common Stock trades
regular way on such exchange or in such market after the time at which such
subdivision or combination becomes effective. Notwithstanding the foregoing,
whenever successive adjustments to the Exercise Price are called for pursuant to
this Section 9, such adjustments shall be made to the Current Market Price as
may be necessary or appropriate to effectuate the intent of this Section 9 and
to avoid unjust or inequitable results as determined in good faith by the
Company's Board of Directors.

            (3) "fair market value" shall mean the amount which a willing buyer
would pay a willing seller in an arm's length transaction.

            (4) "Record Date" shall mean, with respect to any dividend,
distribution or other transaction or event in which the holders of Common Stock
have the right to receive any cash, securities or other property or in which the
Common Stock (or other applicable security) is exchanged for or converted into
any combination of cash, securities or other property, the date fixed

                                      -15-
<PAGE>

for determination of stockholders entitled to receive such cash, securities or
other property (whether such date is fixed by the Company's Board of Directors
or by statute, contract or otherwise).

      (g) The Company may make such reductions in the Exercise Price, in
addition to those required by Section 9(a), (b), (c), (d) or (e) of this
Warrant, as the Company's Board of Directors considers to be advisable to avoid
or diminish any income tax to holders of Common Stock or rights to purchase
Common Stock resulting from any dividend or distribution of stock (or rights to
acquire stock) or from any event treated as such for income tax purposes.

      (h) To the extent permitted by applicable law, the Company from time to
time may reduce the Exercise Price by any amount for any period of time if the
period is at least twenty (20) days, the reduction is irrevocable during such
period and the Company's Board of Directors shall have made a determination that
such reduction would be in the best interests of the Company, which
determination shall be conclusive and described in a Board Resolution. Whenever
the Exercise Price is reduced pursuant to the preceding sentence, the Company
shall mail to the holder of each Warrant at his last address in the Warrant
Register a notice of the reduction at least fifteen (15) days prior to the date
the reduced Exercise Price is to take effect, and such notice shall state the
reduced Exercise Price and the period during which it will be in effect.

      (i) No adjustment in the Exercise Price shall be required under this
Section 9 unless such adjustment would require an increase or decrease of at
least one percent (1%) in the Exercise Price; provided, however, that any
adjustments which by reason of this Section 9(i) are not required to be made
shall be carried forward and taken into account in any subsequent adjustment.
All calculations under this Section 9 shall be made by the Company and shall be
made to the nearest cent or to the nearest one hundredth of a share, as the case
may be. No adjustment need be made for a change in the par value of the Common
Stock.

      (j) Notice to Holders of Warrants Prior to Certain Actions. In case:

            (1) the Company shall declare a dividend (or any other distribution)
on its Common Stock that would require an adjustment in the Exercise Price
pursuant to this Section 9; or

            (2) the Company shall authorize the granting to the holders of its
Common Stock of rights or warrants to subscribe for or purchase any share of any
class or any other rights or warrants; or

            (3) of any reclassification of the Common Stock of the Company
(other than a subdivision or combination of its outstanding Common Stock, or a
change from par value to no par value), or of any consolidation or merger to
which the Company is a party and for which approval of any stockholders of the
Company is required, or of the sale and transfer of all or substantially all of
the assets of the Company; or

            (4) of the voluntary or involuntary dissolution, liquidation or
winding-up of the Company;

                                      -16-
<PAGE>

      the Company shall mail to the holder at such address appearing in the
Warrant Register as promptly as possible but in any event at least fifteen (15)
days prior to the applicable date hereinafter specified, a notice stating (x)
the date on which a record is to be taken for the purpose of such dividend,
distribution or rights are to be determined, or (y) the date on which such
reclassification, consolidation, merger, sale, transfer, dissolution,
liquidation or winding-up is expected to become effective or occur, and the date
as of which it is expected that holders of Common Stock of record shall be
entitled to exchange their Common Stock for securities or other property
deliverable upon such reclassification, consolidation, merger, sale, transfer,
dissolution, liquidation or winding-up and the Company shall contemporaneously
issue a press release through PRNewswire or Bloomberg Financial Markets
containing substantially the same information as the notice described above.
Failure to give such notice, or any defect therein, shall not affect the
legality or validity of such dividend, distribution, reclassification,
consolidation, merger, sale, transfer, dissolution, liquidation or winding-up.
In addition, whenever the Exercise Price is adjusted as provided in this Section
9, the Company shall prepare a notice of such adjustment of the Exercise Price
setting forth the adjusted Exercise Price and the date on which each adjustment
becomes effective and shall mail such notice of such adjustment of the Exercise
Price to the holder of each Warrant at his last address in the Warrant Register
within twenty (20) days of the effective date of such adjustment. Failure to
deliver such notice shall not effect the legality or validity of any such
adjustment.

      (k) In any case in which this Section 9 provides that an adjustment shall
become effective immediately after a Record Date for an event, the Company may
defer until the occurrence of such event (i) issuing to the holder of any
Warrant exercised after such Record Date and before the occurrence of such event
the additional shares of Common Stock issuable upon such exercise by reason of
the adjustment required by such event over and above the Common Stock issuable
upon such conversion before giving effect to such adjustment and (ii) paying to
such holder any amount in cash in lieu of any fractions of shares of Common
Stock pursuant to Section 2(c) of this Warrant.

      (l) For purposes of this Section 9, the number of shares of Common Stock
at any time outstanding shall not include shares held in the treasury of the
Company but shall include shares issuable in respect of scrip certificates
issued in lieu of fractions of shares of Common Stock. The Company will not pay
any dividend or make any distribution on shares of Common Stock held in the
treasury of the Company.

      (m) Upon each adjustment of the Exercise Price pursuant to this Section 9,
each Warrant shall thereupon evidence the right to purchase that number of
shares of Common Stock (calculated to the nearest hundredth of a share) obtained
by multiplying the number of shares of Common Stock purchasable immediately
prior to such adjustment upon exercise of the Warrant by the Exercise Price in
effect immediately prior to such adjustment and dividing the product so obtained
by the Exercise Price in effect immediately after such adjustment. The
adjustment pursuant to this Section 9(m) to the number of shares of Common Stock
purchasable upon exercise of a Warrant shall be made each time an adjustment of
the Exercise Price is made pursuant to this Section 9 (or would be made but for
Section 9(k) of this Warrant).

                                      -17-
<PAGE>

SECTION 10. EFFECT OF RECLASSIFICATION, CONSOLIDATION, MERGER OR SALE. If any of
the following events occur, namely (i) any reclassification or change of the
outstanding shares of Common Stock (other than a change in par value, or from
par value to no par value, or from no par value to par value, or as a result of
a subdivision or combination), (ii) any consolidation, merger or combination of
the Company with another person as a result of which holders of Common Stock
shall be entitled to receive stock, securities or other property or assets
(including cash) with respect to or in exchange for such Common Stock (other
than as a result of a change in name, a change in par value or a change in the
jurisdiction of incorporation), (iii) any statutory exchange, as a result of
which holders of Common Stock generally shall be entitled to receive stock,
securities or other property or assets (including cash) with respect to or in
exchange for such Common Stock (such transaction, a "Statutory Exchange"), (iv)
any sale or conveyance of the properties and assets of the Company as, or
substantially as, an entirety to any other person as a result of which holders
of Common Stock shall be entitled to receive stock, securities or other property
or assets (including cash) with respect to or in exchange for such Common Stock,
then the Company or the successor or purchasing person, as the case may be,
shall issue a replacement Warrant providing that such Warrant shall be
exercisable for the kind and amount of shares of stock and other securities or
property or assets (including cash) receivable upon such reclassification,
change, consolidation, merger, combination, Statutory Exchange, sale or
conveyance by a holder of a number of shares of Common Stock issuable upon
exercise of such Warrants (assuming, for such purposes, a sufficient number of
authorized shares of Common Stock available for issuance upon exercise of all
such Warrants) immediately prior to such reclassification, change,
consolidation, merger, combination, Statutory Exchange, sale or conveyance
assuming such holder of Common Stock did not exercise his rights of election, if
any, that holders of Common Stock who were entitled to vote or consent to such
transaction had as to the kind or amount of securities, cash or other property
receivable upon such consolidation, merger, combination, Statutory Exchange,
sale or conveyance (provided that, if the kind or amount of securities, cash or
other property receivable upon such consolidation, merger, combination,
Statutory Exchange, sale or conveyance is not the same for each share of Common
Stock in respect of which such rights of election shall not have been exercised
("non-electing share"), then for the purposes of this Section 10, the kind and
amount of securities, cash or other property receivable upon such consolidation,
merger, combination, Statutory Exchange, sale or conveyance for each
non-electing share shall be deemed to be the kind and amount so receivable per
share by a plurality of the non-electing shares). Such replacement Warrant shall
provide for adjustments which shall be as nearly equivalent as may be
practicable to the adjustments provided for in Section 9 of this Warrant. If, in
the case of any such reclassification, change, consolidation, merger,
combination, Statutory Exchange, sale or conveyance, the stock or other
securities and assets receivable thereupon by a holder of shares of Common Stock
shall include shares of stock or other securities and assets of a corporation
other than the successor or purchasing person, as the case may be, in such
reclassification, change, consolidate, merger, combination, Statutory Exchange,
sale or conveyance, then such replacement Warrant shall also be executed by such
other person and shall contain such additional provisions to protect the
interests of the holder of the Warrants as the Company's Board of Directors
shall reasonably consider necessary by reason of the foregoing. The Exercise
Price for the stock and other securities, property and assets (including cash)
so receivable upon such event shall be an amount equal to the Exercise Price
immediately prior to such event.

                                      -18-
<PAGE>

      The Company shall mail such replacement Warrant to each holder of
Warrants, at such holder's address appearing in the Warrant Register within
twenty (20) days after execution thereof. Failure to deliver such notice shall
not affect the legality or validity of such replacement Warrant.

      The above provisions of this Section 10 shall similarly apply to
successive reclassifications, changes, consolidations, mergers, combinations,
sales and conveyances.

      If this Section 10 applies to any event or occurrence, Section 9 of this
Warrant shall not apply.

SECTION 11. LOST, STOLEN, MUTILATED OR DESTROYED WARRANTS. If this Warrant is
lost, stolen, mutilated or destroyed, the Company shall promptly, on receipt of
an indemnification undertaking or other form of security reasonably acceptable
to the Company (or in the case of a mutilated Warrant, the Warrant), issue a new
Warrant of like denomination and tenor as this Warrant so lost, stolen,
mutilated or destroyed. Notwithstanding the foregoing, if this Warrant is lost
by, stolen from or destroyed by the original holder hereof, the affidavit of
such original holder setting forth the circumstances of such loss, theft or
destruction shall be accepted as satisfactory evidence thereof, and no
indemnification bond or other security shall be required by the Company as a
condition to the execution and delivery by the Company of a new Warrant to such
original holder other than such original holder's unsecured written agreement to
indemnify the Company solely for losses actually incurred by the Company as a
direct consequence of the loss, theft or destruction of the Warrant.

SECTION 12. NOTICE. Any notices, consents, waivers or other communications
required or permitted to be given under the terms of this Warrant must be in
writing and will be deemed to have been delivered: (i) upon receipt, when
delivered personally; (ii) upon receipt, when sent by facsimile; or (iii) one
(1) Business Day after deposit with a nationally recognized overnight delivery
service, in each case properly addressed to the party to receive the same. If
notice is to be sent to the Company, the holder shall use its reasonable best
efforts to provide additional copies to the individuals listed below; provided,
however, that the failure of such holder to send such additional copies shall in
no way limit the effectiveness of any notice sent to the Company to the
attention of Chief Financial Officer as provided for below. The addresses and
facsimile numbers for such communications shall be:

            If to the Company:
                                         Electroglas, Inc.
                                         6024 Silver Creek Valley Road
                                         San Jose, California  95138-10111
                                         Telephone: (408) 528-3000
                                         Facsimile: (408) 528-3542
                                         Attention: Curtis Wozniak

                                      -19-
<PAGE>

                             with a copy to:

                                         Morrison & Foerster LLP
                                         755 Page Mill Road
                                         Palo Alto, California
                                         Telephone: (650) 813-5600
                                         Facsimile: (650) 494-0792
                                         Attention: Justin Bastian, Esq.

            If to the Transfer Agent:

                             EquiServe Trust Company, N.A.
                             150 Royall Street
                             Mail Stop 45-02-62
                             Canton, MA 92021
                             Telephone: (781) 575-4489
                             Facsimile: (781) 575-2550
                             Attention: Paul Alfano

      If to a holder of this Warrant, to it at the address and facsimile number
set forth on the Schedule of Buyers to the Securities Purchase Agreement, with
copies to such holder's representatives as set forth on such Schedule of Buyers,
or at such other address and facsimile as shall be delivered to the Company upon
the issuance or transfer of this Warrant. Each party shall provide five days'
prior written notice to the other party of any change in address or facsimile
number. Written confirmation of receipt (A) given by the recipient of such
notice, consent, waiver or other communication, (B) mechanically or
electronically generated by the sender's facsimile machine containing the time,
date, recipient facsimile number and an image of the first page of such
transmission or (C) provided by a nationally recognized overnight delivery
service shall be rebuttable evidence of personal service, receipt by facsimile
or receipt from a nationally recognized overnight delivery service in accordance
with clause (i), (ii) or (iii) above, respectively.

SECTION 13. AMENDMENTS. This Warrant and any term hereof may be amended,
changed, waived, discharged, or terminated only by an instrument in writing
signed by the Company and holders of a majority of Warrant Shares represented by
all Warrants. Such amendment, change, waiver, discharge or termination shall be
binding on the Company and all of the Warrant holder's assignees and
transferees; provided, however, that no such action may increase the Exercise
Price, including by a waiver of or an amendment to Section 9 of this Agreement,
or decrease the number of shares or class of stock issuable upon exercise of any
Warrants without the written consent of the holder of such Warrant. No waivers
of any term, condition or provision of this Warrant in any one or more instances
shall be deemed to be or construed as a further or continuing waiver of any such
term, condition or provision.

                                      -20-
<PAGE>

SECTION 14. GOVERNING LAW; JURISDICTION; WAIVER OF JURY TRIAL. The corporate
laws of the State of California shall govern all issues concerning the relative
rights of the Company and its stockholders. All other questions concerning the
construction, validity, enforcement and interpretation of this Warrant shall be
governed by the internal laws of the State of New York, without giving effect to
any choice of law or conflict of law provision or rule (whether of the State of
New York or any other jurisdictions) that would cause the application of the
laws of any jurisdictions other than the State of New York. Each party hereby
irrevocably submits to the non-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, 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 brought in an inconvenient forum or that the
venue of 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 to such
party at the address for such notices to it under this Warrant 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. If any provision of this
Warrant shall be invalid or unenforceable in any jurisdiction, such invalidity
or unenforceability shall not affect the validity or enforceability of the
remainder of this Warrant in that jurisdiction or the validity or enforceability
of any provision of this Warrant in any other jurisdiction. EACH PARTY HEREBY
IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY
TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION HEREWITH OR
ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.

SECTION 15. DESCRIPTIVE HEADINGS. The headings of this Warrant are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.

                                      -21-
<PAGE>

      IN WITNESS WHEREOF, the Company has caused this Warrant to be duly
executed as of day and year first above written.

                                        "COMPANY"

                                        ELECTROGLAS, INC.

                                        By:
                                             -----------------------------------
                                        Its:
                                             -----------------------------------

                                      S-1
<PAGE>

                              EXHIBIT A TO WARRANT

                             FORM OF EXERCISE NOTICE

      The undersigned holder hereby exercises the right to purchase
______________ shares of Common Stock ("Warrant Shares") of ELECTROGLAS, INC., a
Delaware corporation (the "Company"), evidenced by the attached Warrant (the
"Warrant"). Capitalized terms used herein and not otherwise defined shall have
the respective meanings set forth in the Warrant.

      1. Form of Exercise Price. The Holder intends that payment of the Exercise
Price shall be made as:

            ______      "Cash Exercise" with respect to ________ Warrant Shares;
                        and/or

            ______      "Cashless Exercise" with respect to ______ Warrant
                        Shares (to the extent permitted by the terms of the
                        Warrant).

      2. Payment of Exercise Price. In the event that the holder has elected a
Cash Exercise with respect to some or all of the Warrant Shares to be issued
pursuant hereto, the holder shall pay the sum of $___________________ to the
Company in accordance with the terms of the Warrant.

      3. Delivery of Warrant Shares. The holder of this warrant has sold or will
sell the shares of common stock issuable pursuant to this Notice pursuant to a
registration statement or an exemption from registration under the Securities
Act of 1933, as amended.

      4. Private Placement Representations. The holder of this Warrant confirms
the continuing validity of, and reaffirms as of the date hereof, its
representations and warranties set forth in Section 7 of the Warrant.

Date: _______________, ____

------------------------------------    ----------------------------------------
Name of Registered Holder               Tax ID of Registered Holder
                                        (if applicable)

By:
     -------------------------------
Its:
     -------------------------------

                                      A-1
<PAGE>

                                 ACKNOWLEDGMENT

      The Company hereby acknowledges this Exercise Notice and hereby directs
EquiServe Trust Company, N.A. to issue the above indicated number of shares of
Common Stock in accordance with the Irrevocable Transfer Agent Instructions
dated ________, 2002 from the Company and acknowledged and agreed to by
[_____________].

                                        ELECTROGLAS, INC.

                                        By:
                                             -----------------------------------
                                        Its:
                                             -----------------------------------

                                      A-2
<PAGE>

                              EXHIBIT B TO WARRANT

                               FORM OF ASSIGNMENT

      FOR VALUE RECEIVED, the undersigned does hereby assign and transfer to
________________, Federal Identification No. __________, a warrant to purchase
____________ shares of the capital stock of ELECTROGLAS, INC., a Delaware
corporation, represented by warrant certificate no. _____, standing in the name
of the undersigned on the books of said corporation. The undersigned does hereby
irrevocably constitute and appoint ______________, attorney to transfer the
warrants of said corporation, with full power of substitution in the premises.

Dated:  _________, 200_

                                        ----------------------------------------

                                        By:
                                             -----------------------------------
                                        Its:
                                             -----------------------------------<PAGE>

                                                                     EXHIBIT 4.4

================================================================================

                               ELECTROGLAS, INC.,

                                 as the Company

                            ROBERTSON STEPHENS, INC.,

                                  as Robertson

                                       and

                                     BUYERS,

                                as defined herein

                          REGISTRATION RIGHTS AGREEMENT

                            Dated as of June 19, 2002

                  5.25% Convertible Subordinated Notes due 2007
                      and Warrants to Purchase Common Stock

================================================================================

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                       PAGE
<S>                                                                                    <C>
SECTION 1.  Definitions..............................................................    1

SECTION 2.  Registration.............................................................    2

SECTION 3.  Related Obligations......................................................    5

SECTION 4.  Obligations Of The Investors.............................................   10

SECTION 5.  Expenses Of Registration.................................................   11

SECTION 6.  Indemnification..........................................................   11

SECTION 7.  Contribution.............................................................   14

SECTION 8.  Reporting................................................................   14

SECTION 9.  Assignment of Registration Rights........................................   14

SECTION 10. Amendment of Registration Rights.........................................   15

SECTION 11. Miscellaneous............................................................   15

EXHIBIT A   Schedule of Buyers.......................................................  A-1

EXHIBIT B   Form of Notice of Effectiveness of Registration Statement................  B-1
</TABLE>

                                       i
<PAGE>

                          REGISTRATION RIGHTS AGREEMENT

            THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement"), is entered
into as of June 19, 2002, by and among Electroglas, Inc., a Delaware corporation
(the "Company"), Robertson Stephens, Inc. ("Robertson") and the buyers listed on
the Schedule of Buyers attached hereto as Exhibit A (each, a "Buyer" and,
collectively, the "Buyers").

            THE PARTIES TO THIS AGREEMENT enter into this agreement on the basis
of the following facts, intentions and understanding:

            A. The Company and the Buyers entered into that certain Securities
Purchase Agreement of even date herewith (the "Securities Purchase Agreement"),
and, upon the terms and subject to the conditions of the Securities Purchase
Agreement, the Company has agreed (i) to issue and sell to the Buyers an
aggregate of up to (A) Thirty-Five Million Five Hundred Thousand United States
Dollars ($35,500,000) of the Company's 5.25% Convertible Subordinated Notes due
2007 (such Convertible Subordinated Notes, as the same may be amended, modified
or supplemented from time to time in accordance with the terms thereof (the
"Notes")), which shall be convertible into shares of common stock, $0.01 par
value per share (the "Common Stock") of the Company (as converted, the
"Conversion Shares"), and (B) Warrants (such Warrants, as the same may be
amended, modified or supplemented from time to time in accordance with the terms
thereof, the "Buyer Warrants") to purchase up to 649,612 shares of Common Stock
(as exercised collectively, the "Buyer Warrant Shares"), and (ii) to issue to
Robertson Warrants (such Warrants, as the same may be amended, modified or
supplemented from time to time in accordance with the terms thereof, the
"Robertson Warrants" and, together with the Buyer Warrants, the "Warrants") to
purchase the number of shares of Common Stock set forth on the Schedule of Fees
attached as Exhibit D to the Securities Purchase Agreement (as exercised
collectively, the "Robertson Warrant Shares" and, together with the Buyer
Warrant Shares, the "Warrant Shares").

            B. To induce the Buyers to execute and deliver the Securities
Purchase Agreement and to induce Robertson to act as the Company's exclusive
placement agent, the Company has agreed to provide certain registration rights
to the Buyers and Robertson under the Securities Act of 1933, as amended, and
the rules and regulations thereunder, or any similar successor statute
(collectively, the "Securities Act"), and applicable state securities laws.

            NOW, THEREFORE, in consideration of the promises and the mutual
covenants contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Company, Robertson
and each of the Buyers hereby agree as follows:

            SECTION 1. DEFINITIONS. As used in this Agreement, the following
terms shall have the following meanings:

            (a) "Business Day" means any day other than Saturday, Sunday or any
other day on which commercial banks in The City of New York are required by law
to remain closed.

<PAGE>

            (b) "Investor" means Robertson and each Buyer and any transferee or
assignee thereof to whom Robertson or a Buyer assigns its rights under this
Agreement and who agrees to become bound by the provisions of this Agreement in
accordance with Section 9 of this Agreement, and any subsequent transferee or
assignee thereof to whom a transferee or assignee assigns its rights under this
Agreement and who agrees to become bound by the provisions of this Agreement in
accordance with Section 9 of this Agreement.

            (c) "Person" means an individual, a limited liability company, a
partnership, a joint venture, a corporation, a trust, an unincorporated
organization or association and governmental or any department or agency
thereof.

            (d) "register," "registered," and "registration" means a
registration effected by preparing and filing one or more Registration
Statements (as defined below) in compliance with the Securities Act and pursuant
to Rule 415 under the Securities Act or any successor rule providing for
offering securities on a continuous or delayed basis ("Rule 415"), and the
declaration or ordering of effectiveness of such Registration Statements by the
United States Securities and Exchange Commission (the "Commission").

            (e) "Registrable Securities" means (i) the Notes, (ii) the Warrants,
(iii) the Conversion Shares issued or issuable upon conversion of the Notes,
(iv) the Warrant Shares issued or issuable upon exercise of the Warrants, (v)
any shares of capital stock issued or issuable with respect to the Conversion
Shares, the Notes, the Warrant Shares or the Warrants as a result of any stock
split, stock dividend, recapitalization, exchange or similar event or otherwise,
without regard to any limitations on conversions of the Notes or the exercise of
the Warrants, and (vi) any shares of capital stock of any entity issued in
respect of the capital stock referenced in the immediately preceding clauses
(i), (ii), (iii), (iv) and (v) as a result of a merger, consolidation, sale of
assets, sale or exchange of capital stock or other similar transaction.

            (f) "Registration Statement" means a registration statement or
registration statements of the Company filed under the Securities Act and
covering all of the Registrable Securities.

            (g) Capitalized terms used herein and not otherwise defined herein
shall have the respective meanings set forth in the Securities Purchase
Agreement.

            SECTION 2. REGISTRATION.

            (a) Mandatory Registration. The Company shall use its reasonable
efforts to prepare and, as soon as practicable but in no event later than 30
calendar days after the Closing Date (as that term is defined in the Securities
Purchase Agreement) (the "Filing Deadline"), file with the Commission a
Registration Statement on Form S-3 covering the resale of all of the Registrable
Securities. In the event that Form S-3 is unavailable for such a registration,
the Company shall use such other form as is available for such a registration,
subject to the provisions of Section 2(d) of this Agreement. The Registration
Statement prepared pursuant hereto shall register the Registrable Securities for
resale, including at least 105% of the number of shares of Common Stock issuable
upon conversion of the Notes and exercise of the Warrants by the Investors from
time to time in accordance with the methods of distribution elected by such

                                       2
<PAGE>

Investors. The Company shall use reasonable efforts to have the Registration
Statement declared effective by the Commission as soon as practicable, but not
later than 90 calendar days after the Closing Date (the "Effectiveness
Deadline"); provided, however, that if the Commission reviews the Registration
Statement and requires the Company to make modifications thereto, then the
Effectiveness Deadline shall be extended to 120 calendar days after the Closing
Date. In the event that, after the Closing Date and before the Registration
Statement is declared effective, the offices of the Commission are closed due to
acts of God, war or terror, the Effectiveness Deadline will be extended by a
number of days equal to the days of any such closure.

            (b) Allocation of Registrable Securities. The initial number of
Conversion Shares and Warrant Shares included in any Registration Statement and
each increase in the number of Registrable Securities included therein shall be
allocated pro rata among the Investors based on the number of Registrable
Securities held by each Investor at the time the Registration Statement covering
such initial number of Registrable Securities or increase thereof is declared
effective by the Commission. In the event that an Investor sells or otherwise
transfers any of such Investor's Registrable Securities, each transferee shall
be allocated the portion of the then remaining number of Conversion Shares and
Warrant Shares included in such Registration Statement allocable to the
transferor. In no event shall the Company include any securities other than
Registrable Securities on any Registration Statement without the prior written
consent of the Investors holding at least a majority of the Conversion Shares
and Warrant Shares, determined as if all of the Notes held by Investors then
outstanding have been converted into Conversion Shares and all Warrants then
outstanding have been exercised for Warrant Shares without regard to any
limitations on conversion of the Notes or on the exercise of the Warrants.

            (c) Legal Counsel. Subject to Section 5 of this Agreement, the
Investors holding at least a majority of the Conversion Shares and Warrant
Shares, determined as if all of the Notes held by Investors then outstanding
have been converted into Conversion Shares and all Warrants then outstanding
have been exercised for Warrant Shares without regard to any limitations on
conversion of the Notes or on the exercise of the Warrants, shall have the right
to select one legal counsel to review and comment upon any registration pursuant
to this Agreement (the "Legal Counsel"), which the Investors agree shall be
Gibson, Dunn & Crutcher LLP or such other counsel as thereafter designated in
writing by the holders of at least a majority of the Conversion Shares and
Warrant Shares, determined as set forth above. The Investors hereby waive any
conflict of interest or potential conflict of interest that may arise as a
result of the representation of such Investors by Gibson, Dunn & Crutcher LLP in
connection with the subject matter of this Agreement. The provision will not
prohibit any other counsel to an Investor from reviewing and commenting on any
registration filed pursuant to this Agreement at no cost to the Company.

            (d) Ineligibility for Form S-3. If Form S-3 is not available for the
registration of the resale of the Registrable Securities hereunder or the
Company is not permitted by the Securities Act or the Commission to use Form
S-3, then the Company shall (i) register the resale of the Registrable
Securities on another appropriate form reasonably acceptable to the holders of
at least a majority of the Conversion Shares and Warrant Shares, determined as
if all of the Notes held by Investors then outstanding have been converted into
Conversion Shares and all Warrants then outstanding have been exercised for
Warrant Shares without regard to any limitations on conversion of the Notes or
on the exercise of the Warrants and (ii) undertake to register the Registrable
Securities on Form S-3 as soon as such form is available; provided, however,
that the

                                       3
<PAGE>

Company shall maintain the effectiveness of the Registration Statement then in
effect until such time as a Registration Statement on Form S-3 covering all of
the Registrable Securities has been declared effective by the Commission.

            (e) Sufficient Number of Shares Registered. In the event the number
of shares registered under a Registration Statement filed pursuant to Section
2(a) of this Agreement is insufficient to cover all of the Conversion Shares and
Warrant Shares or all of an Investor's allocated portion of the Conversion
Shares and Warrant Shares pursuant to Section 2(b) of this Agreement, the
Company shall amend the Registration Statement, or file a new Registration
Statement (on the short form available therefor, if applicable), or both, so as
to cover at least one hundred five percent (105%) of the number of such
Conversion Shares and Warrant Shares as of the trading day immediately preceding
the date of the filing of such amendment and/or new Registration Statement, in
each case, as soon as practicable, but in no event later than fifteen (15) days
after the necessity therefor arises. The Company shall use its reasonable
efforts to cause such amendment and/or new Registration Statement to become
effective as soon as practicable following the filing thereof. The calculation
of the number of shares sufficient to cover all of the Conversion Shares and
Warrant Shares shall be made without regard to any limitations on the conversion
of the Notes or the exercise of the Warrants, and such calculation shall assume
that all of the Notes are then convertible into, and all of the Warrants are
then exercisable for, shares of Common Stock at the then prevailing Conversion
Rate (as defined in the Notes) or Warrant Exercise Price (as defined in the
Warrants), as applicable.

            (f) Effect of Failure to File and Obtain and Maintain Effectiveness
of Registration Statement. If (i) a Registration Statement covering all the
Registrable Securities is not filed with the Commission on or before the Filing
Deadline or is not declared effective by the Commission on or before the
Effectiveness Deadline, (ii) a Registration Statement covering all of the
Registrable Securities required to be covered thereby, as described in Section
2(e) of this Agreement, is not filed with the Commission on or before the
deadline described in Section 2(e) of this Agreement or is not declared
effective by the Commission on or before the deadline described in Section 2(e)
of this Agreement, (iii) on any day after such Registration Statement has been
declared effective by the Commission, sales of all of the Registrable Securities
required to be included on such Registration Statement cannot be made (other
than during an Allowable Grace Period (as defined in Section 3(n) of this
Agreement) pursuant to such Registration Statement (including, without
limitation, because of a failure to keep such Registration Statement effective,
to disclose such information as is necessary for sales to be made pursuant to
such Registration Statement or to register a sufficient number of shares of
Common Stock), or (iv) a Grace Period (as defined in Section 3(n) of this
Agreement) exceeds the length of an Allowable Grace Period (each of the items
described in clauses (i), (ii) and (iii) above shall be referred to as a
"Registration Delay"), then the Company shall pay (1) to each holder of the
Notes or Conversion Shares an amount in cash equal to the product of (i) the
initial principal amount paid for such Note or the related Conversion Shares
multiplied by (ii) the product of (I) the percentage determined by dividing (A)
the Applicable Percentage by (B) 30, multiplied by (II) the sum of (x) the
number of days (including any partial days) after the Filing Deadline or the
deadline described in Section 2(e) of this Agreement, as applicable, that the
Registration Statement is not filed with the Commission, plus (y) the number of
days (including any partial days) after the Effectiveness Deadline or the
deadline described in Section 2(e) of this Agreement that the Registration
Statement is not declared effective by the Commission, plus (z) after the

                                       4
<PAGE>

Registration Statement has been declared effective by the Commission, the number
of days (including any partial days) that such Registration Statement is not
available (other than during an Allowable Grace Period) for the sale of all the
Registrable Securities and (2) to each holder of the Warrants or Warrant Shares
an amount in cash equal to the product of (i) the Exercise Price for such
Warrant or the related Warrant Shares multiplied by (ii) the product of (I) the
percentage determined by dividing (A) the Applicable Percentage by (B) 30,
multiplied by (II) the sum of (x) the number of days (including any partial
days) after the Filing Deadline or the deadline described in Section 2(e) of
this Agreement, as applicable, that the Registration Statement is not filed with
the Commission, plus (y) the number of days (including any partial days) after
the Effectiveness Deadline or the deadline described in Section 2(e) of this
Agreement, as applicable, that the Registration Statement is not declared
effective by the Commission, plus (z) after the Registration Statement has been
declared effective by the Commission, the number of days (including any partial
days) that such Registration Statement is not available (other than during an
Allowable Grace Period) for the sale of all Registrable Securities. The
"Applicable Percentage" shall mean (A) for period that only include days on or
before the day that is 60 days after the commencement of a Registration Delay,
eight-tenths percent (0.8%), (B) for periods that only include days after the
date that is 60 days after the commencement of a Registration Delay, one percent
(1.0%) and (C) for periods that include days both before and after the date that
is 60 days after the commencement of a Registration Delay, a percentage equal to
a fraction, the numerator of which shall be the sum of (i) the number of days in
such period that are on or before the date that is 60 days after the
commencement of such Registration Delay multiplied by eight-tenths percent
(0.8%) and (ii) the number of days in such period that are after the date that
is 60 days after the commencement of such Registration Delay multiplied by one
percent (1.0%) and the denominator of which shall be the total number of days
comprising such period. The payments to which a holder shall be entitled
pursuant to this Section 2(f) are referred to herein as "Registration Delay
Payments." The Registration Delay Payments shall be paid in cash on the earlier
of (A) the last day of the calendar month during which such Registration Delay
Payments are incurred and (B) the third Business Day after the event or failure
giving rise to the Registration Delay Payments is cured. In the event the
Company fails to make Registration Delay Payments in a timely manner, such
Registration Delay Payments shall bear interest at the rate of one and
two-tenths percent (1.2%) per month (prorated for partial months) until paid in
full.

            SECTION 3. RELATED OBLIGATIONS. At such time as the Company is
obligated to file a Registration Statement with the Commission pursuant to
Section 2(a), 2(d) or 2(e) of this Agreement, the Company will use reasonable
efforts to effect the registration of all of the Registrable Securities in
accordance with the intended method of disposition thereof and, pursuant
thereto, the Company shall have the following obligations:

            (a) The Company shall promptly prepare and file with the Commission
a Registration Statement with respect to all of the Registrable Securities (but
in no event later than the applicable Filing Deadline) and use reasonable
efforts to cause such Registration Statement relating to all of the Registrable
Securities required to be covered thereby to become effective as soon as
practicable after such filing (but in no event later than the applicable
Effectiveness Deadline). The Company shall, subject to the terms of this
Agreement, keep each Registration Statement effective pursuant to Rule 415 at
all times until the earliest of (i) the second anniversary of the date such
Registration Statement is filed, (ii) the date as of which all of the

                                       5
<PAGE>

Investors (other than any Investors who are "affiliates" of the Company as such
term is used in Rule 144(k) promulgated under the Securities Act) may sell all
of the Registrable Securities without restriction pursuant to Rule 144(k) (or
the successor rule thereto) promulgated under the Securities Act or (iii) the
date on which all of the Investors shall have sold all of the Registrable
Securities (the "Registration Period"), which Registration Statement, as of its
filing and effective dates and each day thereafter (including all amendments or
supplements thereto, as of their respective filing and effective dates and each
day thereafter), shall 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, and the prospectus contained in
such Registration Statement, as of its filing date and each day thereafter
(including all amendments and supplements thereto, as of their respective filing
dates and each day thereafter), shall not contain any untrue statement of a
material fact or omit to state a material fact required to be stated thereon, or
necessary to make the statements therein, in light of the circumstances in which
they were made, not misleading.

            (b) Subject to Section 3(n) of this Agreement, the Company shall
prepare and file with the Commission such amendments (including post-effective
amendments) and supplements to the Registration Statement and the prospectus
used in connection with such Registration Statement, which prospectus is to be
filed pursuant to Rule 424 (or any successor rule thereto) promulgated under the
Securities Act, as may be necessary to keep such Registration Statement
effective at all times during the Registration Period, and, during such period,
comply with the provisions of the Securities Act. In the case of amendments and
supplements to a Registration Statement and the prospectus used in connection
with such Registration Statement which are required to be filed pursuant to this
Agreement (including pursuant to this Section 3(b)) by reason of the Company
filing a report on Form 10-K, Form 10-Q or Form 8-K or any analogous report
under the Securities Exchange Act of 1934, as amended, and the rules and
regulations thereunder, or any similar successor statute (the "Exchange Act"),
the Company shall have incorporated such report by reference into such
Registration Statement, if applicable, or shall file such amendments or
supplements with the Commission on the same day on which the Exchange Act report
is filed which created the requirement for the Company to amend or supplement
such Registration Statement and prospectus.

            (c) The Company shall permit Legal Counsel to review and comment
upon each Registration Statement, prospectus and all amendments and supplements
thereto at least one (1) Business Day prior to their filing with the Commission.
The Company shall furnish to the Investors and Legal Counsel, without charge,
(i) promptly after receipt of such correspondence, copies of all correspondence
from the Commission or the staff of the Commission to the Company or its
representatives relating to each Registration Statement, prospectus and all
amendments and supplements thereto, (ii) promptly after the same is prepared and
filed with the Commission, one (1) copy of each Registration Statement,
prospectus and all amendments and supplements thereto, including all exhibits
and financial statements related thereto, and (iii) promptly upon the
effectiveness of each Registration Statement and each amendment and supplement
thereto, one (1) copy of the prospectus included in each such Registration
Statement and all amendments and supplements thereto. The Company agrees that it
will, and it will cause its counsel to, consider in good faith any comments or
objections from Legal Counsel as to the form or content of each Registration
Statement, prospectus and all amendments or supplements

                                       6
<PAGE>

thereto or any request for acceleration of the effectiveness of each
Registration Statement, prospectus and all amendments or supplements thereto.

            (d) The Company shall furnish to each Investor whose Registrable
Securities are included in any Registration Statement, without charge to such
Investor, (i) promptly after the same is prepared and filed with the Commission,
at least one copy of such Registration Statement and all amendments and
supplements thereto, including all exhibits and financial statements and each
preliminary prospectus, (ii) upon the effectiveness of each Registration
Statement, such number of copies of the prospectus included in such Registration
Statement and all amendments and supplements thereto as such Investor may
reasonably request, and (iii) such other documents, including copies of any
preliminary or final prospectus, as such Investor may reasonably request from
time to time in order to facilitate the disposition of the Registrable
Securities.

            (e) Subject to Section 3(n) of this Agreement, the Company shall use
reasonable efforts to (i) promptly register and qualify, unless an exemption
from registration and qualification applies, the resale of the Registrable
Securities under such other securities or "blue sky" laws of all applicable
jurisdictions in the United States as any holder of Registrable Shares
reasonably requests in writing, (ii) promptly prepare and file in those
jurisdictions, such amendments (including post-effective amendments) and
supplements to such registrations and qualifications as may be necessary to
maintain the effectiveness thereof during the Registration Period, (iii)
promptly take such other actions as may be reasonably necessary to maintain such
registrations and qualifications in effect at all times during the Registration
Period, and (iv) promptly take all other actions reasonably necessary or
advisable to qualify the Registrable Securities for sale in such jurisdictions;
provided, however, that the Company shall not be required in connection
therewith or as a condition thereto to file a general consent to service of
process in any such jurisdiction, except in such jurisdictions where the Company
is subject to service of process. The Company shall promptly notify each
Investor who holds Registrable Securities and Legal Counsel of the receipt by
the Company of any notification with respect to the suspension of the
registration or qualification of any of the Registrable Securities for sale
under the securities or "blue sky" laws of any jurisdiction in the United States
or its receipt of notice of the initiation or threatening of any proceeding for
such purpose.

            (f) Notwithstanding anything to the contrary set forth herein, as
promptly as practicable after becoming aware of such event, the Company shall
notify each Investor and Legal Counsel in writing of the happening of any event
as a result of which (i) the Registration Statement or any amendment or
supplement thereto, as then in effect, includes an untrue statement of a
material fact or omission to state a material fact required to be stated therein
or necessary to make the statements therein not misleading or (ii) the
prospectus related to such Registration Statement or any amendment or supplement
thereto includes an untrue statement of a material fact or omission to state a
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading, and, subject to Section 3(n) of this Agreement, promptly prepare a
supplement or amendment to such Registration Statement and prospectus to correct
such untrue statement or omission, and deliver such number of copies of such
supplement or amendment to each Investor and Legal Counsel as such Investor or
Legal Counsel may reasonably request. The Company shall also promptly notify
each Investor and Legal Counsel in writing (i) when a prospectus and

                                       7
<PAGE>

each prospectus supplement or amendment thereto has been filed, and when a
Registration Statement and each amendment (including post-effective amendments)
and supplement thereto has been declared effective by the Commission
(notification of such effectiveness shall be delivered to each Investor and
Legal Counsel by facsimile on the same day of such effectiveness and by
overnight mail), (ii) of any request by the Commission for amendments or
supplements to a Registration Statement or related prospectus or related
information, and (iii) of the Company's reasonable determination that an
amendment (including any post-effective amendment) or supplement to a
Registration Statement or prospectus would be appropriate (subject to Section
3(n) hereof).

            (g) Subject to Section 3(n) of this Agreement, the Company shall use
reasonable efforts to (i) prevent the issuance of any stop order or other
suspension of effectiveness of a Registration Statement, or the suspension of
the qualification of any of the Registrable Securities for sale in any
jurisdiction, (ii) if such an order or suspension is issued, obtain the
withdrawal of such order or suspension at the earliest practicable moment and
notify each holder of Registrable Securities and Legal Counsel of the issuance
of such order and the resolution thereof or its receipt of notice of the
initiation or threat of any proceeding for such purpose.

            (h) The Company shall hold in confidence and not make any disclosure
of information concerning an Investor provided to the Company unless (i)
disclosure of such information is necessary to comply with United States federal
or state securities laws, (ii) the disclosure of such information is necessary
to avoid or correct a misstatement or omission in any Registration Statement,
prospectus or any amendment or supplement thereto, (iii) the release of such
information is ordered pursuant to a subpoena or other final, non-appealable
order from a court or governmental body of competent jurisdiction, or (iv) such
information has been made generally available to the public other than by
disclosure in violation of this Agreement or any other agreement. The Company
agrees that it shall, upon learning that disclosure of such information
concerning an Investor is sought in or by a court or governmental body of
competent jurisdiction or through other means, unless ordered or requested by
the Commission or other governmental authority not to do so, give prompt written
notice to such Investor and allow such Investor, at the Investor's expense, to
undertake appropriate action to prevent disclosure of, or to obtain a protective
order for, such information.

            (i) The Company shall use reasonable efforts to (i) cause all the
Conversion Shares and Warrant Shares to be listed on each securities exchange on
which securities of the same class or series issued by the Company are then
listed, if any, if the listing of such Conversion Shares and Warrant Shares is
then permitted under the rules of such exchange, or (ii) secure designation and
quotation of all the Conversion Shares and Warrant Shares on The Nasdaq National
Market, or (iii) if the Company is unsuccessful in satisfying the preceding
clause (i) or (ii), to secure the inclusion for quotation on The Nasdaq SmallCap
Market for such Conversion Shares and Warrant Shares and, without limiting the
generality of the foregoing, to arrange for at least two market makers to
register with the National Association of Securities Dealers, Inc. ("NASD") as
such with respect to such Conversion Shares and Warrant Shares. The Company
shall pay all fees and expenses in connection with satisfying its obligation
under this Section 3(i).

                                       8
<PAGE>

            (j) In connection with any sale or transfer of Registrable
Securities pursuant to a Registration Statement, the Company shall cooperate
with the Investors who hold Registrable Securities being offered and, to the
extent applicable, facilitate the timely preparation and delivery of
certificates (not bearing any restrictive legend) representing the Registrable
Securities to be offered pursuant to a Registration Statement and enable such
certificates to be in such denominations or amounts, as the case may be, as the
Investors may reasonably request and, registered in such names as the Investors
may request.

            (k) If requested by an Investor, the Company shall (i) as soon as
practicable, incorporate in each prospectus supplement or post-effective
amendment to the Registration Statement such information as an Investor
reasonably requests to be included therein relating to the sale and distribution
of the Registrable Securities, (ii) as soon as practicable, make all required
filings of such prospectus supplement or post-effective amendment after being
notified of the matters to be incorporated in such prospectus supplement or
post-effective amendment, and (iii) as soon as practicable, supplement or make
amendments to any Registration Statement and prospectus if reasonably requested
by an Investor holding any Registrable Securities.

            (l) The Company shall comply with all applicable rules and
regulations of the Commission in connection with any registration hereunder.

            (m) Within two (2) Business Days after a Registration Statement is
ordered effective by the Commission, the Company shall deliver, and shall cause
legal counsel for the Company to deliver, to the transfer agent for the
Registrable Securities (with copies to the Investors whose Registrable
Securities are included in such Registration Statement) confirmation that such
Registration Statement has been declared effective by the Commission in the form
attached hereto as Exhibit B.

            (n) Notwithstanding anything to the contrary herein, at any time
after a Registration Statement has been declared effective by the Commission,
the Company may delay the disclosure of material non-public information
concerning the Company if the disclosure of such information at the time is not,
in the good faith judgment of the Board of Directors of the Company, in the best
interests of the Company (a "Grace Period"); provided, however, that the Company
shall promptly (i) notify the Investors in writing of the existence of material
non-public information giving rise to a Grace Period (provided that the Company
shall not disclose the content of such material non-public information to the
Investors) and the date on which the Grace Period will begin, and (ii) notify
the Investors in writing of the date on which the Grace Period ends; provided
further, that no single Grace Period shall exceed thirty (30) consecutive days,
and during any three hundred sixty-five (365) day period, the aggregate of all
of the Grace Periods shall not exceed an aggregate of sixty (60) days and the
first day of any Grace Period must be at least ten (10) trading days after the
last day of any prior Grace Period (an "Allowable Grace Period"). For purposes
of determining the length of a Grace Period, the Grace Period shall be deemed to
begin on and include the date the Investors receive the notice referred to in
clause (i) above and shall end on and include the later of the date the
Investors receive the notice referred to in clause (ii) above and the date
referred to in such notice; provided, however, that no Grace Period shall be
longer than an Allowable Grace Period. The provisions of Section 3(g) of this
Agreement shall not be applicable during the period of any Allowable Grace
Period. Upon

                                       9
<PAGE>

expiration of the Grace Period, the Company shall again be bound by the first
sentence of Section 3(f) of this Agreement.

            SECTION 4. OBLIGATIONS OF THE INVESTORS.

            (a) At least seven (7) Business Days prior to the first anticipated
filing date of a Registration Statement, the Company shall notify each Investor
in writing of the information the Company requires from each such Investor if
such Investor elects to have any of such Investor's Registrable Securities
included in such Registration Statement. It shall be a condition precedent to
the obligations of the Company to complete the registration pursuant to this
Agreement with respect to the Registrable Securities of a particular Investor
that such Investor shall furnish to the Company such information regarding
itself, the Registrable Securities held by it and the intended method of
disposition of the Registrable Securities held by it as shall be reasonably
required to effect the effectiveness of the registration of such Registrable
Securities and shall execute such documents in connection with such registration
as the Company may reasonably request. Each Investor shall promptly notify the
Company of any material change with respect to such information previously
provided to the Company by such Investor.

            (b) Each Investor agrees to cooperate with the Company as reasonably
requested by the Company in connection with the preparation and filing of any
Registration Statement hereunder, unless such Investor has notified the Company
in writing of such Investor's election to exclude all of such Investor's
Registrable Securities from such Registration Statement, in which case, such
Investor does not need to cooperate with the Company until it notifies the
Company of its desire to include one or more shares of the Registrable
Securities in such Registration Statement.

            (c) Each Investor agrees that, upon receipt of any notice from the
Company of the happening of any event of the kind described in Section 3(g) or
3(n) of this Agreement or the first sentence of Section 3(f) of this Agreement,
such Investor will immediately discontinue disposition of Registrable Securities
pursuant to any Registration Statements covering such Registrable Securities
until such Investor's receipt of the copies of the amended or supplemented
prospectus contemplated by Section 3(g) of this Agreement or the first sentence
of Section 3(f) of this Agreement or receipt of notice that no amendment or
supplement is required and, if so directed by the Company, such Investor shall
deliver to the Company (at the expense of the Company) or destroy (and deliver
to the Company a certificate of destruction) all copies of the prospectus
covering such Registrable Securities current at the time of receipt of such
notice (other than a single file copy, which such Investor may keep) in such
Investor's possession. Notwithstanding anything to the contrary in this
Agreement, the Company shall cause its transfer agent to deliver unlegended
shares of Common Stock to a transferee of an Investor in accordance with the
terms of the Securities Purchase Agreement, the Notes, and/or the Warrant, as
applicable, in connection with any sale of Registrable Securities with respect
to which an Investor has entered into a contract for sale prior to the
Investor's receipt of a notice from the Company of the happening of any event of
the kind described in Section 3(g) of this Agreement or the first sentence of
Section 3(f) of this Agreement and for which the Investor has not yet settled.

                                       10
<PAGE>

            SECTION 5. EXPENSES OF REGISTRATION. All expenses, other than
underwriting discounts and commissions, incurred in connection with
registrations, filings or qualifications pursuant to Sections 2 and 3 of this
Agreement, including, without limitation, all registration, listing and
qualifications fees, printers and accounting fees, transfer agent fees and fees
and disbursements of counsel for the Company, shall be paid by the Company. The
Company shall also reimburse the Investors for the fees and disbursements of
Legal Counsel in connection with registration, filing or qualification pursuant
to Sections 2 and 3 of this Agreement, which amount shall be limited to Ten
Thousand Dollars ($10,000) for each Registration Statement. In addition, the
Company shall pay all of the Investors' reasonable costs (including fees and
disbursements of Legal Counsel) incurred in connection with the successful
enforcement of the Investors' rights under this Agreement.

            SECTION 6. INDEMNIFICATION. In the event any Registrable Securities
are included in a Registration Statement under this Agreement:

            (a) To the fullest extent permitted by law, the Company will, and
hereby does, indemnify, hold harmless and defend each Investor, the directors,
officers, members, partners, employees, agents, representatives of, and each
Person, if any, who controls any Investor within the meaning of the Securities
Act or the Exchange Act (each, an "Indemnified Person"), against any losses,
claims, damages, liabilities, judgments, fines, penalties, charges, costs,
reasonable attorneys' fees, amounts paid in settlement or expenses, joint or
several, (collectively, "Claims") incurred in investigating, preparing or
defending any action, claim, suit, inquiry, proceeding, investigation or appeal
taken from the foregoing by or before any court or governmental, administrative
or other regulatory agency, body or the Commission, whether pending or
threatened, whether or not an indemnified party is or may be a party thereto
("Indemnified Damages"), to which any of them may become subject insofar as such
Claims (or actions or proceedings, whether commenced or threatened, in respect
thereof) arise out of or are based upon (i) any untrue statement or alleged
untrue statement of a material fact in a Registration Statement or any amendment
(including post-effective amendments) or supplement thereto or in any filing
made in connection with the qualification of the offering under the securities
or other "blue sky" laws of any jurisdiction in which the Registrable Securities
are offered ("Blue Sky Filing"), or the omission or alleged omission to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading, (ii) any untrue statement or alleged untrue statement of
a material fact contained in any preliminary prospectus if used prior to the
effective date of such Registration Statement, or contained in the final
prospectus (as amended or supplemented, if any) or the omission or alleged
omission to state therein any material fact necessary to make the statements
made therein, in light of the circumstances under which the statements therein
were made, not misleading, (iii) any violation or alleged violation by the
Company of the Securities Act, the Exchange Act, any other law, including,
without limitation, any state securities law, or any rule or regulation
thereunder relating to the offer or sale of the Registrable Securities pursuant
to a Registration Statement, or (iv) any material violation of this Agreement by
the Company (the matters in the foregoing clauses (i) through (iv) being,
collectively, "Violations"). Subject to Section 6(c) of this Agreement, the
Company shall reimburse the Indemnified Persons, promptly as such expenses are
incurred and are due and payable, for any legal fees or other reasonable
expenses incurred by them in connection with investigating or defending any such
Claim. Notwithstanding anything to the contrary contained herein, the
indemnification agreement contained in this Section 6(a): (i) shall not apply to
a

                                       11
<PAGE>

Claim by an Indemnified Person arising out of or based upon a Violation which
occurs in reliance upon and in conformity with information furnished in writing
to the Company by such Indemnified Person expressly for use in connection with
the preparation of the Registration Statement or any such amendment thereof or
supplement thereto; (ii) shall not be available to the extent such Claim is
based on a failure of the Investor to deliver or to cause to be delivered the
prospectus made available by the Company, including a corrected prospectus, if
such prospectus or corrected prospectus was timely made available by the Company
pursuant to Section 3(d) of this Agreement; and (iii) shall not apply to amounts
paid in settlement of any Claim if such settlement is effected without the prior
written consent of the Company, which consent shall not be unreasonably
withheld, conditioned or delayed. Such indemnity shall remain in full force and
effect regardless of any investigation made by or on behalf of the Indemnified
Person and shall survive the transfer of the Registrable Securities by the
Investors pursuant to Section 9 of this Agreement.

            (b) In connection with any Registration Statement in which an
Investor is participating, each such Investor agrees to severally and not
jointly indemnify, hold harmless and defend, to the same extent and in the same
manner as is set forth in Section 6(a) of this Agreement, the Company, each of
its directors, each of its officers who signs the Registration Statement and
each Person, if any, who controls the Company within the meaning of the
Securities Act or the Exchange Act (each, an "Indemnified Party"), against any
Claims or Indemnified Damages to which any of them may become subject, under the
Securities Act, the Exchange Act or otherwise, insofar as such Claims or
Indemnified Damages arise out of or are based upon any Violation (including for
purposes of this paragraph, a material violation of this Agreement by the
Investor), in each case to the extent, and only to the extent, that such
Violation occurs in reliance upon and in conformity with written information
furnished to the Company by such Investor expressly for use in connection with
such Registration Statement and, subject to Section 6(c) of this Agreement, such
Investor will reimburse any legal or other expenses reasonably incurred by an
Indemnified Party in connection with investigating or defending any such Claim;
provided, however, that the indemnification agreement contained in this Section
6(b) and the agreement with respect to contribution contained in Section 7 of
this Agreement shall not apply to amounts paid in settlement of any Claim if
such settlement is effected without the prior written consent of such Investor,
which consent shall not be unreasonably withheld or delayed; provided, further,
that the Investor shall be liable under this Section 6(b) for only that amount
of the Claims and Indemnified Damages as does not exceed the net proceeds to
such Investors as a result of the sale of Registrable Securities pursuant to
such Registration Statement. Such indemnification agreement shall remain in full
force and effect regardless of any investigation made by or on behalf of such
Indemnified Party and shall survive the transfer of the Registrable Securities
by the Investors pursuant to Section 9 of this Agreement. Notwithstanding
anything to the contrary contained herein, the indemnification agreement
contained in this Section 6(b) shall not inure to the benefit of any Indemnified
Party if the untrue statement or omission of material fact contained in the
preliminary prospectus was corrected on a timely basis in the prospectus, as
then amended or supplemented.

            (c) Promptly after an Indemnified Person or Indemnified Party under
this Section 6 has knowledge of any Claim as to which such Indemnified Person or
Indemnified Party reasonably believes indemnity may be sought or promptly after
such Indemnified Person or Indemnified Party receives notice of the commencement
of any action or proceeding (including

                                       12
<PAGE>

any governmental action or proceeding) involving a Claim, such Indemnified
Person or Indemnified Party shall, if a Claim in respect thereof is to be made
against any indemnifying party under this Section 6, deliver to the indemnifying
party a written notice of such Claim, and the indemnifying party shall have the
right to participate in, and, to the extent the indemnifying party so desires,
jointly with any other indemnifying party similarly noticed, to assume control
of the defense thereof with counsel mutually satisfactory to the indemnifying
party and the Indemnified Person or the Indemnified Party, as the case may be;
provided, however, that an Indemnified Person or Indemnified Party shall have
the right to retain its own counsel if, in the reasonable opinion of counsel
retained by the indemnifying party, the representation by such counsel of the
Indemnified Person or Indemnified Party and the indemnifying party would be
inappropriate due to actual or potential differing interests between such
Indemnified Person or Indemnified Party and any other party represented by such
counsel in such proceeding; provided, further, that the indemnifying party shall
not be responsible for the reasonable fees and expense of more than one (1)
separate legal counsel for such Indemnified Person or Indemnified Party. In the
case of an Indemnified Person, the legal counsel referred to in the immediately
preceding sentence shall be selected by the Investors holding at least a
majority in interest of the Conversion Shares and Warrant Shares included in the
Registration Statement to which the Claim relates. The Indemnified Party or
Indemnified Person shall cooperate fully with the indemnifying party in
connection with any negotiation or defense of any such action or Claim by the
indemnifying party and shall furnish to the indemnifying party all information
reasonably available to the Indemnified Party or Indemnified Person which
relates to such action or Claim. The indemnifying party shall keep the
Indemnified Party or Indemnified Person fully apprised at all times as to the
status of the defense or any settlement negotiations with respect thereto. No
indemnifying party shall be liable for any settlement of any action, claim or
proceeding effected without its prior written consent; provided, however, that
the indemnifying party shall not unreasonably withhold, delay or condition its
consent. No indemnifying party shall, without the prior written consent of the
Indemnified Party or Indemnified Person, consent to entry of any judgment or
enter into any settlement or other compromise which does not include as an
unconditional term thereof the giving by the claimant or plaintiff to such
Indemnified Party or Indemnified Person of a full release from all liability in
respect to such Claim and action and proceeding. After indemnification as
provided for under this Agreement, the rights of the indemnifying party shall be
subrogated to all rights of the Indemnified Party or Indemnified Person with
respect to all third parties, firms or corporations relating to the matter for
which indemnification has been made. The failure to deliver written notice to
the indemnifying party as provided in this Agreement shall not relieve such
indemnifying party of any liability to the Indemnified Person or Indemnified
Party under this Section 6, except to the extent that the indemnifying party is
prejudiced in its ability to defend such action.

            (d) The indemnification required by this Section 6 shall be made by
periodic payments of the amount thereof during the course of the investigation
or defense, as and when bills are received or Indemnified Damages are incurred.

            (e) The indemnification agreements contained herein shall be in
addition to (i) any cause of action or similar right of the Indemnified Party or
Indemnified Person against the indemnifying party or others, and (ii) any
liabilities the indemnifying party may be subject to pursuant to the law.

                                       13
<PAGE>

            SECTION 7. CONTRIBUTION. To the extent any indemnification by an
indemnifying party is prohibited or limited by law, the indemnifying party
agrees to make the maximum contribution with respect to any amounts for which it
would otherwise be liable under Section 6 of this Agreement to the fullest
extent permitted by law; provided, however, that: (i) no contribution shall be
made under circumstances where the maker would not have been liable for
indemnification under the fault standards set forth in Section 6 of this
Agreement, (ii) no Person involved in the sale of Registrable Securities who is
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) in connection with such sale shall be entitled to
contribution from any Person involved in such sale of Registrable Securities who
is not guilty of fraudulent misrepresentation, and (iii) contribution by any
seller of Registrable Securities shall be limited in amount to the net amount of
proceeds received by such seller from the sale of such Registrable Securities
pursuant to such Registration Statement. The provisions of this Section 7 shall
remain in full force and effect, regardless of the investigation made by or on
behalf of the beneficiaries of this Section 7 and shall survive the transfer of
Registrable Securities by the Investors pursuant to Section 9 of this Agreement.

            SECTION 8. REPORTING.

            (a) Reports Under The Exchange Act. With a view to making available
to the Investors the benefits of Rule 144 promulgated under the Securities Act
or any other similar rule or regulation of the Commission that may at any time
permit the Investors to sell securities of the Company to the public without
registration ("Rule 144"), the Company shall use reasonable efforts to:

                        (1) make and keep public information available, as those
            terms are understood and defined in Rule 144;

                        (2) file with the Commission in a timely manner all
            reports and other documents required of the Company under the
            Securities Act and the Exchange Act; and

                        (3) furnish to each Investor, so long as such Investor
            owns Registrable Securities, promptly upon request, (A) a written
            statement by the Company, if true, that it has complied with the
            applicable reporting requirements of Rule 144, the Securities Act
            and the Exchange Act, (B) a copy of the most recent annual or
            quarterly report of the Company and copies of such other reports and
            documents so filed by the Company, and (C) such other information as
            may be reasonably requested to permit the Investors to sell such
            securities pursuant to Rule 144 without registration.

            (b) Rule 144A Information. The Company shall, upon request of any
Investor, make available to such Investor the information required by Rule
144A(d)(4) (or any successor rule) under the Securities Act.

            SECTION 9. ASSIGNMENT OF REGISTRATION RIGHTS. The rights under this
Agreement shall be automatically assignable by the Investors to any transferee
of all or any portion of such Investor's Registrable Securities if: (i) the
Investor agrees in writing with the

                                       14
<PAGE>

transferee or assignee to assign such rights, and a copy of such agreement is
furnished to the Company within a reasonable time after such assignment; (ii)
the Company is, within a reasonable time after such transfer or assignment,
furnished with written notice of (a) the name and address of such transferee or
assignee, and (b) the securities with respect to which such rights are being
transferred or assigned; (iii) immediately following such transfer or
assignment, the further disposition of such securities by the transferee or
assignee is restricted under the Securities Act and applicable state securities
laws; (iv) at or before the time the Company receives the written notice
contemplated by clause (ii) of this sentence, the transferee or assignee agrees
in writing with the Company to be bound by all of the obligations of an Investor
under this Agreement; (v) such transfer shall have been made in accordance with
the applicable requirements of the Securities Purchase Agreement, the Notes and
the Warrants; and (vi) such transfer shall have been conducted in accordance
with all applicable federal and state securities laws.

            SECTION 10. AMENDMENT OF REGISTRATION RIGHTS. Any provision of this
Agreement may be amended and the observance of any provision of this Agreement
may be waived (either generally or in a particular instance and either
retroactively or prospectively), only with the written consent of the Company
and Investors who then hold at least a majority of the Conversion Shares and
Warrant Shares, determined as if all of the Notes held by Investors then
outstanding have been converted into Conversion Shares and all Warrants then
outstanding have been exercised for Warrant Shares without regard to any
limitations on conversion of the Notes or on the exercise of the Warrants. Any
amendment or waiver effected in accordance with this Section 10 shall be binding
upon each Investor and the Company. No such amendment shall be effective to the
extent that it applies to less than all of the holders of the Registrable
Securities. No consideration shall be offered or paid to any Person to amend or
consent to a waiver or modification of any provision of any of this Agreement
unless the same consideration also is offered to all of the parties to this
Agreement.

            SECTION 11. MISCELLANEOUS.

            (a) A Person is deemed to be a holder of Registrable Securities
whenever such Person owns or is deemed to own of record such Registrable
Securities. If the Company receives conflicting instructions, notices or
elections from two or more Persons with respect to the same Registrable
Securities, the Company shall act upon the basis of instructions, notice or
election received from such record owner of such Registrable Securities.

            (b) Any notices, consents, waivers or other communications required
or permitted to be given under the terms of this Agreement must be in writing
and will be deemed to have been delivered: (i) upon receipt, when delivered
personally; (ii) upon receipt, when sent by facsimile; or (iii) one (1) Business
Day after deposit with a nationally recognized overnight delivery service, in
each case properly addressed to the party to receive the same. The addresses and
facsimile numbers for such communications shall be:

                  If to the Company:

                                       15
<PAGE>

                            Electroglas, Inc.
                            6024 Silver Creek Valley Road
                            San Jose, California  95138-10111
                            Telephone: (408) 528-3000
                            Facsimile: (408) 528-3542
                            Attention: Curtis Wozniak

            with a copy to:

                            Morrison & Foerster, LLP
                            755 Page Mill Road
                            Palo Alto, California
                            Telephone: (650) 813-5600
                            Facsimile: (650) 494-0792
                            Attention: Justin Bastian, Esq.

            If to Robertson Stephens:

                            Robertson Stephens, Inc.
                            555 California Street
                            Suite 2600
                            San Francisco, California  94101
                            Telephone: (415) 676-2886
                            Facsimile: (415) 982-2488
                            Attention: Mr. James Anderson
                                       Mr. Matt Seedorf
                                       Mr. David Fullerton

                                       16
<PAGE>

            with a copy to:

                            Gibson, Dunn & Crutcher LLP
                            1050 Connecticut Avenue NW
                            Washington, DC 20036
                            Telephone: (202) 955-8500
                            Facsimile: (202) 467-0539
                            Attention: Brian Lane, Esq.

            If to Legal Counsel:

                            Gibson, Dunn & Crutcher LLP
                            1050 Connecticut Avenue NW
                            Washington, DC 20036
                            Telephone: (202) 955-8500
                            Facsimile: (202) 467-0539
                            Attention: Brian Lane, Esq.

If to a Buyer, to its address and facsimile number set forth on the Schedule of
Buyers attached hereto as Exhibit A, with copies to such Buyer's representatives
as set forth on the Schedule of Buyers, or to such other address and/or
facsimile number and/or to the attention of such other Person as the recipient
party has specified by written notice given to each other party five (5) days
prior to the effectiveness of such change. Written confirmation of receipt (A)
given by the recipient of such notice, consent, waiver or other communication,
(B) mechanically or electronically generated by the sender's facsimile machine
containing the time, date, recipient facsimile number and an image of the first
page of such transmission, or (C) provided by a courier or overnight courier
service shall be rebuttable evidence of personal service, receipt by facsimile
or receipt from a nationally recognized overnight delivery service in accordance
with clause (i), (ii) or (iii) above, respectively.

            (c) Failure of any party to exercise any right or remedy under this
Agreement or otherwise, or delay by a party in exercising such right or remedy,
shall not operate as a waiver thereof.

            (d) All questions concerning the construction, validity, enforcement
and interpretation of this Agreement shall be governed by the internal laws of
the State of New York, without giving effect to any choice of law or conflict of
law provision or rule (whether of the State of New York or any other
jurisdictions) that would cause the application of the laws of any jurisdictions
other than the State of New York. Each party hereby irrevocably submits to the
non-exclusive jurisdiction of the state and federal courts sitting 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, 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 brought
in an inconvenient forum or that the venue of 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 to such party at the address for

                                       17
<PAGE>

such 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. If any provision of this Agreement shall be
invalid or unenforceable in any jurisdiction, such invalidity or
unenforceability shall not affect the validity or enforceability of the
remainder of this Agreement in that jurisdiction or the validity or
enforceability of any provision of this Agreement in any other jurisdiction.
EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO
REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN
CONNECTION HEREWITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION
CONTEMPLATED HEREBY.

            (e) This Agreement, the Securities Purchase Agreement, the
Indenture, the Notes, the Warrants and the documents referenced herein and
therein constitute the entire agreement among the parties hereto with respect to
the subject matter hereof and thereof. There are no restrictions, promises,
warranties or undertakings, other than those set forth or referred to herein and
therein. This Agreement, the Indenture, the Securities Purchase Agreement, the
Notes and the Warrants supersede all prior agreements and understandings among
the parties hereto with respect to the subject matter hereof and thereof.

            (f) Subject to the requirements of Section 9 of this Agreement, this
Agreement shall inure to the benefit of and be binding upon the permitted
successors and assigns of each of the parties hereto.

            (g) The headings in this Agreement are for convenience of reference
only and shall not limit or otherwise affect the meaning hereof.

            (h) This Agreement may be executed in identical counterparts, each
of which shall be deemed an original but all of which shall constitute one and
the same agreement. This Agreement, once executed by a party, may be delivered
to the other parties hereto by facsimile transmission of a copy of this
Agreement bearing the signature of the party so delivering this Agreement.

            (i) Each party shall do and perform, or cause to be done and
performed, all such further acts and things, and shall execute and deliver all
such other agreements, certificates, instruments and documents, as the other
party may reasonably request in order to carry out the intent and accomplish the
purposes of this Agreement and the consummation of the transactions contemplated
hereby.

            (j) All consents and other determinations required to be made by the
Investors pursuant to this Agreement shall be made, unless otherwise specified
in this Agreement, by Investors holding at least a majority of the majority of
the Conversion Shares and Warrant Shares, determined as if all of the Notes held
by Investors then outstanding have been converted into Conversion Shares and all
Warrants then outstanding have been exercised for Warrant Shares without regard
to any limitations on conversion of the Notes or on the exercise of the
Warrants.

                                       18
<PAGE>

            (k) The language used in this Agreement will be deemed to be the
language chosen by the parties to express their mutual intent and no rules of
strict construction will be applied against any party.

            (l) This Agreement is intended for the benefit of the parties hereto
and their respective permitted successors and assigns, and is not for the
benefit of, nor may any provision hereof be enforced by, any other Person.

                                       19
<PAGE>

            IN WITNESS WHEREOF, the parties have caused this Registration Rights
Agreement to be duly executed as of day and year first above written.

                                        "COMPANY"

                                        ELECTROGLAS, INC.

                                        By:
                                            ------------------------------------
                                            Its:
                                                 -------------------------------

                                        "ROBERTSON"

                                        ROBERTSON STEPHENS, INC.

                                        By:
                                            ------------------------------------
                                            Its:
                                                 -------------------------------

                    [Signatures of Buyers on Following Page]

                                      S-1
<PAGE>

                [SIGNATURE PAGE TO REGISTRATION RIGHTS AGREEMENT]

                                   "BUYER"

                                   ---------------------------------------------
                                          (print full legal name of Buyer)

                                   By:
                                      ------------------------------------------
                                       (signature of authorized representative)

                                   Name:
                                        ----------------------------------------

                                   Its:
                                       -----------------------------------------

                                      S-2
<PAGE>

                   EXHIBIT A TO REGISTRATION RIGHTS AGREEMENT

                               SCHEDULE OF BUYERS

<TABLE>
<CAPTION>
             NAME OF BUYERS                PRINCIPAL AMOUNT OF NOTES  NUMBER OF WARRANTS
-----------------------------------------  -------------------------  ------------------
<S>                                        <C>                        <C>
1.  [Name of Buyer]                            $
    [Contact Information for Buyer]
</TABLE>

                                  Exhibit A-1
<PAGE>

                   EXHIBIT B TO REGISTRATION RIGHTS AGREEMENT

                         FORM OF NOTICE OF EFFECTIVENESS
                            OF REGISTRATION STATEMENT

[Date]

-----------------------
[Address]
[Address]

Attention:
           -----------------

      RE:   ELECTROGLAS, INC.

Ladies and Gentlemen:

      We are counsel to Electroglas, Inc., a Delaware corporation (the
"Company"), and have represented the Company in connection with that certain
Securities Purchase Agreement dated as of June 19, 2002 (the "Securities
Purchase Agreement"), by and among the Company, Robertson Stephens, Inc, and the
buyers named therein (collectively, the "Investors"), pursuant to which the
Company issued to the Investors its 5.25% Convertible Subordinated Notes due
2007 (the "Notes"), convertible into shares of Common Stock, par value $0.01 per
share (the "Common Stock"), of the Company and warrants exercisable for shares
of its Common Stock (the "Warrants"). Pursuant to the Securities Purchase
Agreement, the Company and the Investors also has entered into that certain
Registration Rights Agreement dated as of June 19, 2002 (the "Registration
Rights Agreement"), pursuant to which the Company agreed, among other things, to
register the Registrable Securities (as defined in the Registration Rights
Agreement), including the shares of Common Stock issuable upon conversion of the
Notes and exercise of the Warrants under the Securities Act of 1933, as amended
(the "Securities Act"). In connection with the Company's obligations under the
Registration Rights Agreement, on [____________] [__], 2002, the Company filed a
Registration Statement on Form S-3 (File No. 333-[_____________]) (the
"Registration Statement") with the Securities and Exchange Commission (the
"Commission") relating to the Registrable Securities which names each of the
Investors and their respective transferees as a selling stockholder thereunder.

      In connection with the foregoing, we advise you that a member of the
Commission's staff has advised us by telephone that the Commission has entered
an order declaring the Registration Statement effective under the Securities Act
at [time of effectiveness] on [date of effectiveness] and, we have no knowledge,
after telephonic inquiry of a member of the Commission's staff, that any stop
order suspending its effectiveness has been issued or that any proceedings for
that

                                  Exhibit B-1
<PAGE>

purpose are pending before, or threatened by, the Commission and the Registrable
Securities are available for resale under the Securities Act pursuant to the
Registration Statement.

                                        Very truly yours,

                                        MORRISON & FOERSTER LLP

                                        By:
                                            ------------------------------------

cc:  Brian J. Lane
     [Names of Investors]

                                  Exhibit B-2

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