Document:

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                                                                     EXHIBIT 4.1

                          REGISTRATION RIGHTS AGREEMENT

                  This Registration Rights Agreement (this "Agreement") is made
                                                            ---------
and entered into as of May 2, 2002, by and among Storage Computer Corporation, a
Delaware corporation (the "Company"), and the investors signatory hereto (each a
                           -------
"Purchaser" and collectively, the "Purchasers").
 ---------                         ----------

                  This Agreement is made pursuant to the Securities Purchase
Agreement, dated as of the date hereof among the Company and the Purchasers (the
"Purchase Agreement").
 ------------------

                  The Company and the Purchasers hereby agree as follows:

         1.       Definitions. Capitalized terms used and not otherwise defined
                  -----------
herein that are defined in the Purchase Agreement shall have the meanings given
such terms in the Purchase Agreement. As used in this Agreement, the following
terms shall have the following meanings:

                  "Effectiveness Date" means, (1) with respect to the initial
                   ------------------
Registration Statement required to be filed hereunder, the earlier of (a) 90th
day following the Closing Date and (b) the fifth Trading Day following the date
on which the Company is notified by the Commission that such Registration
Statement will not be reviewed or is no longer subject to further review and
comments, and, (2) with respect to any additional Registration Statements that
may be required pursuant to Section 2(c), (a) the 90th day following the date on
                            -----------
which the Company first knows, or reasonably should have known, that such
additional Registration Statement is required under such Section and (b) the
fifth Trading Day following the date on which the Company is notified by the
Commission that such Registration Statement will not be reviewed or is no longer
subject to further review and comments, such 90 day period to be extended by one
day for each Trading Day beyond three Trading Days that the Holder has not
furnished the Company with its comments on the Registration Statement furnished
to it by the Company in accordance with Section 3(a) of this Agreement.

                  "Effectiveness Period" shall have the meaning set forth in
                   --------------------
Section 2(a).

                  "Filing Date" means, with respect to the initial Registration
                   -----------
Statement required to be filed hereunder, the 30th day following the Closing
Date, and, with respect to any additional Registration Statements that may be
required pursuant to Section 2(c), the 30th day following the date on which the
                     ------------
Company first knows, or reasonably should have known that such additional
Registration Statement is required under such Section.

                  "Holder" or "Holders" means the holder or holders, as the case
                   ------      -------
may be, from time to time of Registrable Securities.

                  "Indemnified Party" shall have the meaning set forth in
                   -----------------
Section 5(c).

                  "Indemnifying Party" shall have the meaning set forth in
                   ------------------
Section 5(c).

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                  "Losses" shall have the meaning set forth in Section 5(a).
                   ------

                  "Proceeding" means an action, claim, suit, investigation or
                   ----------
proceeding (including, without limitation, an investigation or partial
proceeding, such as a deposition), whether commenced or threatened.

                  "Prospectus" means the prospectus included in a Registration
                   ----------
Statement (including, without limitation, a prospectus that includes any
information previously omitted from a prospectus filed as part of an effective
registration statement in reliance upon Rule 430A promulgated under the
Securities Act), as amended or supplemented by any prospectus supplement, with
respect to the terms of the offering of any portion of the Registrable
Securities covered by a Registration Statement, and all other amendments and
supplements to the Prospectus, including post-effective amendments, and all
material incorporated by reference or deemed to be incorporated by reference in
such Prospectus.

                  "Registrable Securities" means (i) the Shares, and (ii) the
                   ----------------------
Warrant Shares, together with any securities issued or issuable upon any stock
split, dividend or other distribution, recapitalization or similar event with
respect to the foregoing.

                  "Registration Statement" means the initial registration
                   ----------------------
statement required to be filed hereunder and any additional registration
statements contemplated by Section 2(c), including (in each case) the
                           ------------
Prospectus, amendments and supplements to such registration statement or
Prospectus, including pre- and post-effective amendments, all exhibits thereto,
and all material incorporated by reference or deemed to be incorporated by
reference in such registration statement.

                  "Rule 144" means Rule 144 promulgated by the Commission
                   --------
pursuant to the Securities Act, as such Rule may be amended from time to time,
or any similar rule or regulation hereafter adopted by the Commission having
substantially the same effect as such Rule.

                  "Rule 415" means Rule 415 promulgated by the Commission
                   --------
pursuant to the Securities Act, as such Rule may be amended from time to time,
or any similar rule or regulation hereafter adopted by the Commission having
substantially the same effect as such Rule.

                  "Rule 424" means Rule 424 promulgated by the Commission
                   --------
pursuant to the Securities Act, as such Rule may be amended from time to time,
or any similar rule or regulation hereafter adopted by the Commission having
substantially the same effect as such Rule.

                  "Shares" means the shares of Common Stock issued or issuable
                   ------
to the Purchasers pursuant to the Purchase Agreement.

                  "Special Counsel" means Purchaser Counsel who will be
                   ---------------
reimbursed by the Company pursuant to Section 4.

                  "Warrants" means the Warrants issued or issuable under the
                   --------
Purchase Agreement.

                  "Warrant Shares" means shares of Common Stock issuable upon
                   --------------
exercise in full of the Warrants.

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         2.       Registration.
                  ------------

                  (a)      On or prior to each Filing Date, the Company shall
prepare and file with the Commission a Registration Statement covering the
resale of all Registrable Securities for an offering to be made on a continuous
basis pursuant to Rule 415. Each Registration Statement shall be on Form S-3
(except if the Company is not then eligible to register for resale the
Registrable Securities on Form S-3, in which case such registration shall be on
another appropriate form in accordance herewith) and shall contain (except if
otherwise directed by the Holders) the "Plan of Distribution" attached hereto as
                                        --------------------
Annex A. The Company shall cause such Registration Statement to become
-------
effective and remain effective as provided herein. The Company shall use its
best efforts to cause each Registration Statement to be declared effective under
the Securities Act as promptly as possible after the filing thereof, but in any
event prior to its Effectiveness Date, and shall use its best efforts to keep
each Registration Statement continuously effective under the Securities Act
until the date which is two years after the date that such Registration
Statement is declared effective by the Commission or such earlier date when all
Registrable Securities covered by such Registration Statement have been sold or
may be sold without volume restrictions pursuant to Rule 144(k) as determined by
the counsel to the Company pursuant to a written opinion letter to such effect,
addressed and acceptable to the Company's transfer agent and the affected
Holders (the "Effectiveness Period").
              --------------------

                  (b)      If: (a) a Registration Statement is not filed on or

prior to its Filing Date (if the Company files a Registration Statement without
affording the Holder the opportunity to review and comment on the same as
required by Section 3(a), the Company shall not be deemed to have satisfied this
clause (a)), or (b) the Company fails to file with the Commission a request for
acceleration in accordance with Rule 461 promulgated under the Securities Act,
within five Trading Days of the date that the Company is notified (orally or in
writing, whichever is earlier) by the Commission that a Registration Statement
will not be "reviewed," or not subject to further review, or (c) prior to the
date when such Registration Statement is first declared effective by the
Commission, the Company fails to file a pre-effective amendment and otherwise
respond in writing to comments made by the Commission in respect of such
Registration Statement within ten Trading Days after the receipt of comments by
or notice from the Commission that such amendment is required in order for a
Registration Statement to be declared effective, or (d) a Registration Statement
filed or required to be filed hereunder is not declared effective by the
Commission by its Effectiveness Date, or (e) after a Registration Statement is
first declared effective by the Commission, it ceases for any reason to remain
continuously effective as to all Registrable Securities for which it is required
to be effective, or the Holders are not permitted to utilize the Prospectus
therein to resell such Registrable Securities, for in any such cases an
aggregate of ten Trading Days (which need not be consecutive Trading Days) (any
such failure or breach being referred to as an "Event," and for purposes of
                                                -----
clause (a) or (d) the date on which such Event occurs, or for purposes of clause
(b) the date on which such five Trading Day period is exceeded, or for purposes
of clauses (c) the date which such ten Trading Day period is exceeded, or for
purposes of clause (e) the date on which such ten Trading Day period is exceeded
being referred to as "Event Date"), then in additional to any other rights the
                      ----------
Holders may have hereunder or applicable law: (x) on each such Event Date the
Company shall pay to each Holder an amount in cash, as liquidated damages and
not as a penalty, equal to 1% of the aggregate purchase price paid by such
Holder pursuant to the Purchase Agreement; and (y) on each monthly anniversary
of each such Event Date (if the applicable Event shall not have been

                                      -3-

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cured by such date) until the applicable Event is cured, the Company shall pay
to each Holder an amount in cash, as liquidated damages and not as a penalty,
equal to 1% of the aggregate purchase price paid by such Holder pursuant to the
Purchase Agreement. If the Company fails to pay any liquidated damages pursuant
to this Section in full within seven days after the date payable, the Company
will pay interest thereon at a rate of 18% per annum (or such lesser maximum
amount that is permitted to be paid by applicable law) to the Holder, accruing
daily from the date such liquidated damages are due until such amounts, plus all
such interest thereon, are paid in full.

                  (c)      The Company will file additional Registration
Statements if the number of Registrable Securities at any time exceeds 85% of
the number of shares of Common Stock then registered in a Registration
Statement. Such additional Registration Statement shall cover the resale by the
Holders of not less than 110% of the number of shares required in order that all
Registrable Securities outstanding and issuable upon exercise of the Warrants
relating to such Registration Statement would then be registered.

         3.       Registration Procedures
                  -----------------------

                  In connection with the Company's registration obligations
hereunder, the Company shall:

                  (a)      Not less than five Trading Days prior to the filing
of a Registration Statement or any related Prospectus or any amendment or
supplement thereto, the Company shall, (i) furnish to the Holders and their
Special Counsel copies of all such documents proposed to be filed (including
documents incorporated or deemed incorporated by reference) which documents will
be subject to the review of such Holders and their Special Counsel, and (ii)
cause its officers and directors, counsel and independent certified public
accountants to respond to such inquiries as shall be necessary, in the
reasonable opinion of respective counsel to conduct a reasonable investigation
within the meaning of the Securities Act. The Company shall not file a
Registration Statement or any such Prospectus or any amendments or supplements
thereto to which the Holders of a majority of the Registrable Securities and
their Special Counsel shall reasonably object.

                  (b)      (i) Prepare and file with the Commission such
amendments, including post-effective amendments, to a Registration Statement and
the Prospectus used in connection therewith as may be necessary to keep a
Registration Statement continuously effective as to the applicable Registrable
Securities for the Effectiveness Period and prepare and file with the Commission
such additional Registration Statements in order to register for resale under
the Securities Act all of the Registrable Securities; (ii) cause the related
Prospectus to be amended or supplemented by any required Prospectus supplement,
and as so supplemented or amended to be filed pursuant to Rule 424; (iii)
respond as promptly as reasonably possible, and in any event within ten days, to
any comments received from the Commission with respect to a Registration
Statement or any amendment thereto and, as promptly as reasonably possible
provide the Holders true and complete copies of all correspondence from and to
the Commission relating to such Registration Statement; and (iv) comply in all
material respects with the provisions of the Securities Act and the Exchange Act
with respect to the disposition of all Registrable Securities covered by a
Registration Statement during the applicable period in accordance with the
intended

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methods of disposition by the Holders thereof set forth in such Registration
Statement as so amended or in such Prospectus as so supplemented.

                  (c)      Notify the Holders of Registrable Securities to be
sold and their Special Counsel as promptly as reasonably possible (and, in the
case of (i)(A) below, not less than three Trading Days prior to such filing) and
(if requested by any such Person) confirm such notice in writing no later than
one Trading Day following the day (i)(A) when a Prospectus or any Prospectus
supplement or post-effective amendment to a Registration Statement is proposed
to be filed; (B) when the Commission notifies the Company whether there will be
a "review" of such Registration Statement and whenever the Commission comments
in writing on such Registration Statement (the Company shall provide true and
complete copies thereof and all written responses thereto to each of the
Holders); and (C) with respect to a Registration Statement or any post-effective
amendment, when the same has become effective; (ii) of any request by the
Commission or any other Federal or state governmental authority for amendments
or supplements to a Registration Statement or Prospectus or for additional
information; (iii) of the issuance by the Commission of any stop order
suspending the effectiveness of a Registration Statement covering any or all of
the Registrable Securities or the initiation of any Proceedings for that
purpose; (iv) of the receipt by the Company of any notification with respect to
the suspension of the qualification or exemption from qualification of any of
the Registrable Securities for sale in any jurisdiction, or the initiation or
threatening of any Proceeding for such purpose; and (v) of the occurrence of any
event or passage of time that makes the financial statements included in a
Registration Statement ineligible for inclusion therein or any statement made in
such Registration Statement or Prospectus or any document incorporated or deemed
to be incorporated therein by reference untrue in any material respect or that
requires any revisions to such Registration Statement, Prospectus or other
documents so that, in the case of a Registration Statement or the Prospectus, as
the case may be, it will not contain any untrue statement of a material fact or
omit to state any 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.

                  (d)      Use its best efforts to avoid the issuance of, or,
if issued, obtain the withdrawal of (i) any order suspending the effectiveness
of a Registration Statement, or (ii) any suspension of the qualification (or
exemption from qualification) of any of the Registrable Securities for sale in
any jurisdiction, at the earliest practicable moment.

                  (e)      Furnish to each Holder and their Special Counsel,
without charge, at least one conformed copy of each Registration Statement and
each amendment thereto, including financial statements and schedules, all
documents incorporated or deemed to be incorporated therein by reference, and
all exhibits to the extent requested by such Person (including those previously
furnished or incorporated by reference) promptly after the filing of such
documents with the Commission.

                  (f)      Promptly deliver to each Holder and their Special
Counsel, without charge, as many copies of the Prospectus or Prospectuses
(including each form of prospectus) and each amendment or supplement thereto as
such Persons may reasonably request. The Company hereby consents to the use of
such Prospectus and each amendment or supplement

                                      -5-

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thereto by each of the selling Holders in connection with the offering and sale
of the Registrable Securities covered by such Prospectus and any amendment or
supplement thereto.

                  (g)      Prior to any public offering of Registrable
Securities, use its best efforts to register or qualify or cooperate with the
selling Holders and their Special Counsel in connection with the registration or
qualification (or exemption from such registration or qualification) of such
Registrable Securities for offer and sale under the securities or Blue Sky laws
of such jurisdictions within the United States as any Holder requests in
writing, to keep each such registration or qualification (or exemption
therefrom) effective during the Effectiveness Period and to do any and all other
acts or things necessary or advisable to enable the disposition in such
jurisdictions of the Registrable Securities covered by a Registration Statement;
provided, that the Company shall not be required to qualify generally to do
--------
business in any jurisdiction where it is not then so qualified or subject the
Company to any material tax in any such jurisdiction where it is not then so
subject.

                  (h)      Cooperate with the Holders to facilitate the timely
preparation and delivery of certificates representing Registrable Securities to
be delivered to a transferee pursuant to a Registration Statement, which
certificates shall be free, to the extent permitted by the Purchase Agreement,
of all restrictive legends, and to enable such Registrable Securities to be in
such denominations and registered in such names as any such Holders may request.

                  (i)      Upon the occurrence of any event contemplated by
Section 3(c)(v), as promptly as reasonably possible, prepare a supplement or
amendment, including a post-effective amendment, to a Registration Statement or
a supplement to the related Prospectus or any document incorporated or deemed to
be incorporated therein by reference, and file any other required document so
that, as thereafter delivered, neither such Registration Statement nor such
Prospectus will contain an 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, in light of the circumstances under which they were made,
not misleading.

                  (j)      Comply with all applicable rules and regulations of
the Commission.

                  (k)      The Company may require each selling Holder to
furnish to the Company a certified statement as to the number of shares of
Common Stock beneficially owned by such Holder and, if requested by the
Commission, the controlling person thereof.

         4.       Registration Expenses. All fees and expenses incident to the
                  ---------------------
performance of or compliance with this Agreement by the Company shall be borne
by the Company whether or not any Registrable Securities are sold pursuant to a
Registration Statement. The fees and expenses referred to in the foregoing
sentence shall include, without limitation, (i) all registration and filing fees
(including, without limitation, fees and expenses (A) with respect to filings
required to be made with the Trading Market on which the Common Stock is then
listed for trading, and (B) in compliance with applicable state securities or
Blue Sky laws), (ii) printing expenses (including, without limitation, expenses
of printing certificates for Registrable Securities and of printing prospectuses
if the printing of prospectuses is reasonably requested by the holders of a
majority of the Registrable Securities included in a Registration Statement),
(iii) messenger, telephone and delivery expenses, (iv) fees and disbursements of
counsel for the Company and

                                      -6-

<PAGE>

$5,000 of the fees and disbursements of Special Counsel for the Holders, (v)
Securities Act liability insurance, if the Company so desires such insurance,
and (vi) fees and expenses of all other Persons retained by the Company in
connection with the consummation of the transactions contemplated by this
Agreement. In addition, the Company shall be responsible for all of its internal
expenses incurred in connection with the consummation of the transactions
contemplated by this Agreement (including, without limitation, all salaries and
expenses of its officers and employees performing legal or accounting duties),
the expense of any annual audit and the fees and expenses incurred in connection
with the listing of the Registrable Securities on any securities exchange as
required hereunder.

         5.       Indemnification
                  ---------------

                  (a)      Indemnification by the Company. The Company shall,
                           ------------------------------
notwithstanding any termination of this Agreement, indemnify and hold harmless
each Holder, the officers, directors, agents and employees of each of them, each
Person who controls any such Holder (within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act) and the officers, directors,
agents and employees of each such controlling Person, to the fullest extent
permitted by applicable law, from and against any and all losses, claims,
damages, liabilities, costs (including, without limitation, reasonable costs of
preparation and reasonable attorneys' fees) and expenses (collectively,
"Losses"), as incurred, arising out of or relating to any untrue or alleged
 ------
untrue statement of a material fact contained in a Registration Statement, any
Prospectus or any form of prospectus or in any amendment or supplement thereto
or in any preliminary prospectus, or arising out of or relating to any omission
or alleged omission of a material fact required to be stated therein or
necessary to make the statements therein (in the case of any Prospectus or form
of prospectus or supplement thereto, in light of the circumstances under which
they were made) not misleading, except to the extent, but only to the extent,
that (1) such untrue statements or omissions are based solely upon information
regarding such Holder furnished in writing to the Company by such Holder
expressly for use therein, or to the extent that such information relates to
such Holder or such Holder's proposed method of distribution of Registrable
Securities and was reviewed and expressly approved in writing by such Holder
expressly for use in a Registration Statement, such Prospectus or such form of
Prospectus or in any amendment or supplement thereto (it being understood that
the Holder has approved Annex A hereto for this purpose) or (2) in the case of
an occurrence of an event of the type specified in Section 3(c)(ii)-(v), the use
by such Holder of an outdated or defective Prospectus after the Company has
notified such Holder in writing that the Prospectus is outdated or defective and
prior to the receipt by such Holder of the Advice contemplated in Section 6(d).
The Company shall notify the Holders promptly of the institution, threat or
assertion of any Proceeding of which the Company is aware in connection with the
transactions contemplated by this Agreement.

                  (b)      Indemnification by Holders. Each Holder shall,
                           --------------------------
severally and not jointly, indemnify and hold harmless the Company, its
directors, officers, agents and employees, each Person who controls the Company
(within the meaning of Section 15 of the Securities Act and Section 20 of the
Exchange Act), and the directors, officers, agents or employees of such
controlling Persons, to the fullest extent permitted by applicable law, from and
against all Losses, as incurred, arising solely out of or based solely upon: (x)
such Holder's failure to comply with the prospectus delivery requirements of the
Securities Act or (y) any untrue

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statement of a material fact contained in any Registration Statement, any
Prospectus, or any form of prospectus, or in any amendment or supplement
thereto, or arising solely out of or based solely upon any omission of a
material fact required to be stated therein or necessary to make the statements
therein not misleading to the extent, but only to the extent, that such untrue
statement or omission is contained in any information so furnished in writing by
such Holder to the Company specifically for inclusion in such Registration
Statement or such Prospectus or to the extent that (1) such untrue statements or
omissions are based solely upon information regarding such Holder furnished in
writing to the Company by such Holder expressly for use therein, or to the
extent that such information relates to such Holder or such Holder's proposed
method of distribution of Registrable Securities and was reviewed and expressly
approved in writing by such Holder expressly for use in a Registration Statement
(it being understood that the Holder has approved Annex A hereto for this
purpose), such Prospectus or such form of Prospectus or in any amendment or
supplement thereto or (2) in the case of an occurrence of an event of the type
specified in Section 3(c)(ii)-(v), the use by such Holder of an outdated or
defective Prospectus after the Company has notified such Holder in writing that
the Prospectus is outdated or defective and prior to the receipt by such Holder
of the Advice contemplated in Section 6(d). In no event shall the liability of
any selling Holder hereunder be greater in amount than the dollar amount of the
net proceeds received by such Holder upon the sale of the Registrable Securities
giving rise to such indemnification obligation.

                  (c)      Conduct of Indemnification Proceedings. If any
                           --------------------------------------
Proceeding shall be brought or asserted against any Person entitled to indemnity
hereunder (an "Indemnified Party"), such Indemnified Party shall promptly notify
               -----------------
the Person from whom indemnity is sought (the "Indemnifying Party") in writing,
                                               ------------------
and the Indemnifying Party shall assume the defense thereof, including the
employment of counsel reasonably satisfactory to the Indemnified Party and the
payment of all fees and expenses incurred in connection with defense thereof;
provided, that the failure of any Indemnified Party to give such notice shall
not relieve the Indemnifying Party of its obligations or liabilities pursuant to
this Agreement, except (and only) to the extent that it shall be finally
determined by a court of competent jurisdiction (which determination is not
subject to appeal or further review) that such failure shall have proximately
and materially adversely prejudiced the Indemnifying Party.

                  An Indemnified Party shall have the right to employ separate
counsel in any such Proceeding and to participate in the defense thereof, but
the fees and expenses of such counsel shall be at the expense of such
Indemnified Party or Parties unless: (1) the Indemnifying Party has agreed in
writing to pay such fees and expenses; (2) the Indemnifying Party shall have
failed promptly to assume the defense of such Proceeding and to employ counsel
reasonably satisfactory to such Indemnified Party in any such Proceeding; or (3)
the named parties to any such Proceeding (including any impleaded parties)
include both such Indemnified Party and the Indemnifying Party, and such
Indemnified Party shall have been advised by counsel that a conflict of interest
is likely to exist if the same counsel were to represent such Indemnified Party
and the Indemnifying Party (in which case, if such Indemnified Party notifies
the Indemnifying Party in writing that it elects to employ separate counsel at
the expense of the Indemnifying Party, the Indemnifying Party shall not have the
right to assume the defense thereof and such counsel shall be at the expense of
the Indemnifying Party). The Indemnifying Party shall not be liable for any
settlement of any such Proceeding effected without its written consent, which
consent shall not be unreasonably withheld. No Indemnifying Party shall, without
the prior

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written consent of the Indemnified Party, effect any settlement of any
pending Proceeding in respect of which any Indemnified Party is a party, unless
such settlement includes an unconditional release of such Indemnified Party from
all liability on claims that are the subject matter of such Proceeding.

                  All fees and expenses of the Indemnified Party (including
reasonable fees and expenses to the extent incurred in connection with
investigating or preparing to defend such Proceeding in a manner not
inconsistent with this Section) shall be paid to the Indemnified Party, as
incurred, within ten Trading Days of written notice thereof to the Indemnifying
Party (regardless of whether it is ultimately determined that an Indemnified
Party is not entitled to indemnification hereunder; provided, that the
                                                    --------
Indemnifying Party may require such Indemnified Party to undertake to reimburse
all such fees and expenses to the extent it is finally judicially determined
that such Indemnified Party is not entitled to indemnification hereunder).

                  (d)      Contribution. If a claim for indemnification under
                           ------------
Section 5(a) or 5(b) is unavailable to an Indemnified Party (by reason of public
policy or otherwise), then each Indemnifying Party, in lieu of indemnifying such
Indemnified Party, shall contribute to the amount paid or payable by such
Indemnified Party as a result of such Losses, in such proportion as is
appropriate to reflect the relative fault of the Indemnifying Party and
Indemnified Party in connection with the actions, statements or omissions that
resulted in such Losses as well as any other relevant equitable considerations.
The relative fault of such Indemnifying Party and Indemnified Party shall be
determined by reference to, among other things, whether any action in question,
including any untrue or alleged untrue statement of a material fact or omission
or alleged omission of a material fact, has been taken or made by, or relates to
information supplied by, such Indemnifying Party or Indemnified Party, and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such action, statement or omission. The amount paid or
payable by a party as a result of any Losses shall be deemed to include, subject
to the limitations set forth in Section 5(c), any reasonable attorneys' or other
reasonable fees or expenses incurred by such party in connection with any
Proceeding to the extent such party would have been indemnified for such fees or
expenses if the indemnification provided for in this Section was available to
such party in accordance with its terms.

                  The parties hereto agree that it would not be just and
equitable if contribution pursuant to this Section 5(d) were determined by pro
rata allocation or by any other method of allocation that does not take into
account the equitable considerations referred to in the immediately preceding
paragraph. Notwithstanding the provisions of this Section 5(d), no Holder shall
be required to contribute, in the aggregate, any amount in excess of the amount
by which the proceeds actually received by such Holder from the sale of the
Registrable Securities subject to the Proceeding exceeds the amount of any
damages that such Holder has otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission or alleged omission.

                  The indemnity and contribution agreements contained in this
Section are in addition to any liability that the Indemnifying Parties may have
to the Indemnified Parties.

                                      -9-

<PAGE>

         6.       Miscellaneous
                  -------------

                  (a)      Remedies. In the event of a breach by the Company or
                           --------
by a Holder, of any of their obligations under this Agreement, each Holder or
the Company, as the case may be, in addition to being entitled to exercise all
rights granted by law and under this Agreement, including recovery of damages,
will be entitled to specific performance of its rights under this Agreement. The
Company and each Holder agree that monetary damages would not provide adequate
compensation for any losses incurred by reason of a breach by it of any of the
provisions of this Agreement and hereby further agrees that, in the event of any
action for specific performance in respect of such breach, it shall waive the
defense that a remedy at law would be adequate.

                  (b)      No Piggyback on Registrations. Except as and to the
                           -----------------------------
extent specified in Schedule 6(b) hereto, neither the Company nor any of its
                    -------------
security holders (other than the Holders in such capacity pursuant hereto) may
include securities of the Company in a Registration Statement other than the
Registrable Securities, and the Company shall not after the date hereof enter
into any agreement providing any such right to any of its security holders.
Except as and to the extent specified in Schedule 6(b) hereto, the Company has
                                         ------------
not previously entered into any agreement granting any registration rights with
respect to any of its securities to any Person which have not been fully
satisfied.

                  (c)      Compliance. Each Holder covenants and agrees that it
                           ----------
will comply with the prospectus delivery requirements of the Securities Act as
applicable to it in connection with sales of Registrable Securities pursuant to
a Registration Statement.

                  (d)      Discontinued Disposition. Each Holder agrees by its
                           ------------------------
acquisition of such Registrable Securities that, upon receipt of a notice from
the Company of the occurrence of any event of the kind described in Section
3(c), such Holder will forthwith discontinue disposition of such Registrable
Securities under a Registration Statement until such Holder's receipt of the
copies of the supplemented Prospectus and/or amended Registration Statement or
until it is advised in writing (the "Advice") by the Company that the use of the
                                     ------
applicable Prospectus may be resumed, and, in either case, has received copies
of any additional or supplemental filings that are incorporated or deemed to be
incorporated by reference in such Prospectus or Registration Statement. The
Company may provide appropriate stop orders to enforce the provisions of this
paragraph.

                  (e)      Piggy-Back Registrations. If at any time during the
                           ------------------------
Effectiveness Period there is not an effective Registration Statement covering
all of the Registrable Securities and the Company shall determine to prepare and
file with the Commission a registration statement relating to an offering for
its own account or the account of others under the Securities Act of any of its
equity securities, other than on Form S-4 or Form S-8 (each as promulgated under
the Securities Act) or their then equivalents relating to equity securities to
be issued solely in connection with any acquisition of any entity or business or
equity securities issuable in connection with stock option or other employee
benefit plans, then the Company shall send to each Holder written notice of such
determination and, if within fifteen days after receipt of such notice, any such
Holder shall so request in writing, the Company shall include in such
registration statement all or any part of such Registrable Securities such
holder requests to be

                                      -10-

<PAGE>

registered, subject to customary underwriter cutbacks applicable to all holders
of registration rights.

                  (f)      Amendments and Waivers. The provisions of this
                           ----------------------
Agreement, including the provisions of this sentence, may not be amended,
modified or supplemented, and waivers or consents to departures from the
provisions hereof may not be given, unless the same shall be in writing and
signed by the Company and the Holders of the then outstanding Registrable
Securities.

                  (g)      Notices. Any and all notices or other communications
                           -------
or deliveries required or permitted to be provided hereunder shall be in writing
and shall be deemed given and effective on the earliest of (i) the date of
transmission, if such notice or communication is delivered via facsimile at the
facsimile number specified in this Section prior to 6:30 p.m. (New York City
time) on a Trading Day, (ii) the Trading Day after the date of transmission, if
such notice or communication is delivered via facsimile at the facsimile number
specified in this Agreement later than 6:30 p.m. (New York City time) on any
date and earlier than 11:59 p.m. (New York City time) on such date, (iii) the
Trading Day following the date of mailing, if sent by nationally recognized
overnight courier service, or (iv) upon actual receipt by the party to whom such
notice is required to be given. The address for such notices and communications
shall be as follows:

         If to the Company:         Storage Computer Corporation
                                    11 Riverside Street
                                    Nashua, New Hampshire 03062-1373
                                    Facsimile No.: (603) 889-7232
                                    Attn: Peter N. Hood, Chief Financial Officer

         With a copy to:            Peabody & Arnold LLP
                                    50 Rowes Wharf
                                    Boston, MA 02110-3342
                                    Facsimile No.: (617) 951-2125
                                    Attn.: Anil Khosla, Esq.

         If to a Purchaser:         To the address set forth under such
                                    Purchaser's name on the signature pages
                                    hereto.

         With a copy to:            Robinson Silverman Pearce Aronsohn & Berman
                                    LLP 1290 Avenue of the Americas New York,
                                    NY 10104 Facsimile No.: (212) 541-4630 and
                                    (212) 541-1432 Attn: Eric L. Cohen, Esq.

         If to any other Person who is then the registered Holder:

                                    To the address of such Holder as it appears
                                    in the stock transfer books of the Company

                                      -11-

<PAGE>

or such other address as may be designated in writing hereafter, in the same
manner, by such Person.

                  (h)      Successors and Assigns. This Agreement shall inure to
                           ----------------------
the benefit of and be binding upon the successors and permitted assigns of each
of the parties and shall inure to the benefit of each Holder. The Company may
not assign its rights or obligations hereunder without the prior written consent
of each Holder. Each Holder may assign their respective rights hereunder in the
manner and to the Persons as permitted under the Purchase Agreement.

                  (i)      Execution and Counterparts. This Agreement may be
                           --------------------------
executed in any number of counterparts, each of which when so executed shall be
deemed to be an original and, all of which taken together shall constitute one
and the same Agreement. In the event that any signature is delivered by
facsimile transmission, such signature shall create a valid binding obligation
of the party executing (or on whose behalf such signature is executed) the same
with the same force and effect as if such facsimile signature were the original
thereof.

                  (j)      Governing Law. All questions concerning the
                           -------------
construction, validity, enforcement and interpretation of this Agreement shall
be governed by and construed and enforced in accordance with the internal laws
of the State of New York, without regard to the principles of conflicts of law
thereof. Each party agrees that all Proceedings concerning the interpretations,
enforcement and defense of the transactions contemplated by this Agreement
(whether brought against a party hereto or its respective affiliates, directors,
officers, shareholders, employees or agents) shall be commenced exclusively in
the state and federal courts sitting in the City of New York, Borough of
Manhattan. Each party hereto hereby irrevocably submits to the exclusive
jurisdiction of the state and federal courts sitting in the City of New York,
Borough of Manhattan for the adjudication of any dispute hereunder or in
connection herewith or with any transaction contemplated hereby or discussed
herein (including with respect to the enforcement of the any of this Agreement),
and hereby irrevocably waives, and agrees not to assert in any Proceeding, any
claim that it is not personally subject to the jurisdiction of any such court,
that such Proceeding is improper. Each party hereto hereby irrevocably waives
personal service of process and consents to process being served in any such
Proceeding by mailing a copy thereof via registered or certified mail or
overnight delivery (with evidence of delivery) to such party at the address in
effect for notices to it under this Agreement and agrees that such service shall
constitute good and sufficient service of process and notice thereof. Nothing
contained herein shall be deemed to limit in any way any right to serve process
in any manner permitted by law. Each party hereto hereby irrevocably waives, to
the fullest extent permitted by applicable law, any and all right to trial by
jury in any legal proceeding arising out of or relating to this Agreement or the
transactions contemplated hereby. If either party shall commence a Proceeding to
enforce any provisions of this Agreement, then the prevailing party in such
Proceeding shall be reimbursed by the other party for its attorneys fees and
other costs and expenses incurred with the investigation, preparation and
prosecution of such Proceeding.

                  (k)      Cumulative Remedies. The remedies provided herein are
                           -------------------
cumulative and not exclusive of any remedies provided by law.

                                      -12-

<PAGE>

                  (l)      Severability. If any term, provision, covenant or
                           ------------
restriction of this Agreement is held by a court of competent jurisdiction to be
invalid, illegal, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions set forth herein shall remain in full force and
effect and shall in no way be affected, impaired or invalidated, and the parties
hereto shall use their reasonable efforts to find and employ an alternative
means to achieve the same or substantially the same result as that contemplated
by such term, provision, covenant or restriction. It is hereby stipulated and
declared to be the intention of the parties that they would have executed the
remaining terms, provisions, covenants and restrictions without including any of
such that may be hereafter declared invalid, illegal, void or unenforceable.

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

                  (n)      Independent Nature of Purchasers' Obligations and
                           -------------------------------------------------
Rights. The obligations of each Purchaser hereunder is several and not joint
------
with the obligations of any other Purchaser hereunder, and no Purchaser shall be
responsible in any way for the performance of the obligations of any other
Purchaser hereunder. Nothing contained herein or in any other agreement or
document delivered at any closing, and no action taken by any Purchaser pursuant
hereto or thereto, shall be deemed to constitute the Purchasers as a
partnership, an association, a joint venture or any other kind of entity, or
create a presumption that the Purchasers are in any way acting in concert with
respect to such obligations or the transactions contemplated by this Agreement.
Each Purchaser shall be entitled to protect and enforce its rights, including
without limitation the rights arising out of this Agreement, and it shall not be
necessary for any other Purchaser to be joined as an additional party in any
proceeding for such purpose.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
                           SIGNATURE PAGES TO FOLLOW]

                                      -13-

<PAGE>

                  IN WITNESS WHEREOF, the parties have executed this
Registration Rights Agreement as of the date first written above.

                               STORAGE COMPUTER CORPORATION

                               By:    /  S  /
                               Name:  Peter N. Hood
                               Title: Chief Financial Officer

                   [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
                     SIGNATURE PAGES OF PURCHASER TO FOLLOW]

<PAGE>

                  IN WITNESS WHEREOF, the parties have executed this
Registration Rights Agreement as of the date first written above.

                               [PURCHASER]

                               By:  See attached list of Purchasers
                                    -------------------------------
                               Name:_______________________________
                               Title:______________________________

                               Address for Notice:
                               [ ]

                               With a copy to:

                               Robinson Silverman Pearce Aronsohn & Berman LLP
                               1290 Avenue of the Americas
                               New York, NY  10104
                               Facsimile No.: (212) 541-4630 and (212) 541-1432
                               Attn: Eric L. Cohen, Esq.

                                      -15-

<PAGE>

                                                                         Annex A
                                                                         -------

                              Plan of Distribution
                              --------------------

         The Selling Stockholders and any of their pledgees, assignees and
successors-in-interest may, from time to time, sell any or all of their shares
of Common Stock on any stock exchange, market or trading facility on which the
shares are traded or in private transactions. These sales may be at fixed or
negotiated prices. The Selling Stockholders may use any one or more of the
following methods when selling shares:

$        ordinary brokerage transactions and transactions in which the
         broker-dealer solicits purchasers;

$        block trades in which the broker-dealer will attempt to sell the shares
         as agent but may position and resell a portion of the block as
         principal to facilitate the transaction;

$        purchases by a broker-dealer as principal and resale by the
         broker-dealer for its account;

$        an exchange distribution in accordance with the rules of the applicable
         exchange;

$        privately negotiated transactions;

$        short sales

$        broker-dealers may agree with the Selling Stockholders to sell a
         specified number of such shares at a stipulated price per share;

$        a combination of any such methods of sale; and

$        any other method permitted pursuant to applicable law.

         The Selling Stockholders may also sell shares under Rule 144 under the
Securities Act, if available, rather than under this prospectus.

         Broker-dealers engaged by the Selling Stockholders may arrange for
other brokers-dealers to participate in sales. Broker-dealers may receive
commissions or discounts from the Selling Stockholders (or, if any broker-dealer
acts as agent for the purchaser of shares, from the purchaser) in amounts to be
negotiated. The Selling Stockholders do not expect these commissions and
discounts to exceed what is customary in the types of transactions involved.

         The selling stockholder may from time to time pledge or grant a
security interest in some or all of the Shares or common stock or Warrant owned
by them and, if they default in the performance of their secured obligations,
the pledgees or secured parties may offer and sell the shares of common stock
from time to time under this prospectus, or under an amendment to this
prospectus under Rule 424(b)(3) or other applicable provision of the Securities
Act of 1933 amending the list of selling stockholders to include the pledgee,
transferee or other successors in interest as selling stockholders under this
prospectus.

                                      -16-

<PAGE>

         The selling stockholders also may transfer the shares of common stock
in other circumstances, in which case the transferees, pledgees or other
successors in interest will be the selling beneficial owners for purposes of
this prospectus.

         The Selling Stockholders and any broker-dealers or agents that are
involved in selling the shares may be deemed to be "underwriters" within the
meaning of the Securities Act in connection with such sales. In such event, any
commissions received by such broker-dealers or agents and any profit on the
resale of the shares purchased by them may be deemed to be underwriting
commissions or discounts under the Securities Act. The Selling Stockholders have
informed the Company that it does not have any agreement or understanding,
directly or indirectly, with any person to distribute the Common Stock.

         The Company is required to pay all fees and expenses incident to the
registration of the shares, including $5,000 of fees and disbursements of
counsel to the Selling Stockholders. The Company has agreed to indemnify the
Selling Stockholders against certain losses, claims, damages and liabilities,
including liabilities under the Securities Act.

                                      -17-

<PAGE>

                               LIST OF PURCHASERS
                               ------------------

     Securities Purchase Agreement Dated May 2, 2002 between Storage Computer
Corporation and the Purchasers.

..    ZLP Master Technology Fund
     45 Broadway - 28th floor
     New York, NY 10006
     Number of shares                   250,000

..    Alpha Capital Aktiengesellschaft
     Pradafant 7
     Furstentums 9490
     Vaduz, Liechtenstein
     Number of shares                   150,000

              Mail all Documents to:
              LH Financial
              160 Central Park South, Suite 2701
              New York, NY 10019
              Att: Mr. Brian Shatz

..    Euram Cap Strat. "A" Fund Limited
     666 Dundee Rd, Suite 1901
     Northbrook, IL 60062
     Number of shares                   100,000

..    Crescent International Ltd.
     c/o GreenLight (Switzerland) S.A.
     84, av. Louis-Casai
     P.O. Box 161
     CH - 1216 Cointrin/Geneva
     Switzerland
     Number of shares                   100,000

                                      -18-<PAGE>

                                                                     EXHIBIT 4.2

NEITHER THESE SECURITIES NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE
EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR
THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN
AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE
SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO
SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE
COMPANY. THESE SECURITIES AND THE SECURITIES ISSUABLE UPON EXERCISE OF THESE
SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER
LOAN SECURED BY SUCH SECURITIES.

                          STORAGE COMPUTER CORPORATION

                                    WARRANT

Warrant No. CSW-[See attached list of Warrant Holders] Date of Original
Issuance: May 3, 2002

         Storage Computer Corporation, a Delaware corporation (the "Company"),
                                                                    -------
hereby certifies that, for value received, [See attached list of Warrant
Holders] or its registered assigns (the "Holder"), is entitled to purchase from
                                         ------
the Company up to a total of [See attached list of Warrant Holders] shares of
common stock, $.001 par value per share (the "Common Stock"), of the Compan/y
                                              ------------
(each such share, a "Warrant Share" and all such shares, the "Warrant Shares")
                     -------------                            --------------
at an exercise price per Warrant Share equal to $6.18 (as adjusted from time to
time as provided in Section 9, the "Exercise Price"), at any time and from time
                                    --------------
to time from and after the date hereof and through and including May 3, 2007
(the "Expiration Date"), and subject to the following terms and conditions:
      ---------------

                  1.       Definitions. In addition to the terms defined
                           -----------
elsewhere in this Warrant, capitalized terms that are not otherwise defined
herein that are defined in the Securities Purchase Agreement, dated May 2, 2002,
between the Company and the original Holder (the "Purchase Agreement"), shall
                                                  ------------------
have the meanings given to such terms in the Purchase Agreement.

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

<PAGE>

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

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

                  4.       Exercise and Duration. Subject to the provisions of
                           ---------------------
Section 5, this Warrant shall be exercisable by the registered Holder at any
time and from time to time on or after the date hereof to and including the
Expiration Date. At 6:30 p.m., New York City time on the Expiration Date, the
portion of this Warrant available for exercise and not exercised prior thereto
shall be and become void and of no value, provided, that if the closing sales
                                          --------
price of the Common Stock on the Expiration Date is greater than 102% of the
Exercise Price on the Expiration Date, then this Warrant shall be deemed to have
been exercised in full (to the extent not previously exercised) on a "cashless
exercise" basis at 6:30 P.M. New York City time on the Expiration Date. The
Company may not call or redeem all or any portion of this Warrant without the
prior written consent of the Holder.

                  5.       Delivery of Warrant Shares.
                           --------------------------

                           (a)      Upon delivery of the Form of Election to
Purchase to the Company (with the attached Warrant Shares Exercise Log) at its
address for notice set forth in Section 13 and upon payment of the Exercise
Price multiplied by the number of Warrant Shares that the Holder intends to
purchase hereunder, the Company shall promptly (but in no event later than five
Trading Days after the Date of Exercise (as defined herein) issue and deliver to
the Holder, a certificate for the Warrant Shares issuable upon such exercise
free of restrictive legends unless otherwise required by the Purchase Agreement.
The Company shall, upon request of the Holder, if available, use its best
efforts to deliver Warrant Shares hereunder electronically through the
Depository Trust Corporation or another established clearing corporation
performing similar functions, provided, that, the Company may, but will not be
required to change its transfer agent if its current transfer agent cannot
deliver Warrant Shares electronically through the Depository Trust Corporation.

                  A "Date of Exercise" means the date on which the Holder shall
                     ----------------
have delivered to the Company (i) the Form of Election to Purchase attached
hereto (with the Warrant Exercise Log attached to it), appropriately completed
and duly signed and (ii) payment of the Exercise Price for the number of Warrant
Shares so indicated by the Holder to be purchased.

                                      2

<PAGE>

                           (b)      If by the third Trading Day after a Date of
Exercise the Company fails to deliver the required number of Warrant Shares in
the manner required pursuant to Section 5(a), then the Holder will have the
right to rescind such exercise.

                           (c)      If by the fifth Trading Day after a Date of
Exercise the Company fails to deliver the required number of Warrant Shares in
the manner required pursuant to Section 5(a), and if after such third Trading
Day the Holder purchases (in an open market transaction or otherwise) shares of
Common Stock to deliver in satisfaction of a sale by the Holder of the Warrant
Shares which the Holder anticipated receiving upon such exercise (a "Buy-In"),
                                                                     ------
then the Company shall (1) pay in cash to the Holder the amount by which (x) the
Holder's total purchase price (including brokerage commissions, if any) for the
shares of Common Stock so purchased exceeds (y) the amount obtained by
multiplying (A) the number of Warrant Shares that the Company was required to
deliver to the Holder in connection with the exercise at issue by (B) the
closing sales price of the Common Stock at the time of the obligation giving
rise to such purchase obligation and (2) at the option of the Holder, either
reinstate the portion of the Warrant and equivalent number of Warrant Shares for
which such exercise was not honored or deliver to the Holder the number of
shares of Common Stock that would have been issued had the Company timely
complied with its exercise and delivery obligations hereunder. For example, if
the Holder purchases Common Stock having a total purchase price of $11,000 to
cover a Buy-In with respect to an attempted exercise of shares of Common Stock
with a market price on the date of exercise totaled $10,000, under clause (1) of
the immediately preceding sentence the Company shall be required to pay the
Holder $1,000. The Holder shall provide the Company written notice indicating
the amounts payable to the Holder in respect of the Buy-In.

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

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

                                      3

<PAGE>

responsible for all other tax liability that may arise as a result of holding or
transferring this Warrant or receiving Warrant Shares upon exercise hereof.

                  7.       Replacement of Warrant. If this Warrant is mutilated,
                           ----------------------
lost, stolen or destroyed, the Company shall issue or cause to be issued in
exchange and substitution for and upon cancellation hereof, or in lieu of and
substitution for this Warrant, a New Warrant, but only upon receipt of evidence
reasonably satisfactory to the Company of such loss, theft or destruction and
customary and reasonable indemnity, if requested. Applicants for a New Warrant
under such circumstances shall also comply with such other reasonable
regulations and procedures and pay such other reasonable third-party costs as
the Company may prescribe.

                  8.       Reservation of Warrant Shares. The Company covenants
                           -----------------------------
that it will at all times reserve and keep available out of the aggregate of its
authorized but unissued and otherwise unreserved Common Stock, solely for the
purpose of enabling it to issue Warrant Shares upon exercise of this Warrant as
herein provided, the number of Warrant Shares which are then issuable and
deliverable upon the exercise of this entire Warrant. The Company covenants that
all Warrant Shares so issuable and deliverable shall, upon issuance and the
payment of the applicable Exercise Price in accordance with the terms hereof, be
duly and validly authorized, issued and fully paid and nonassessable.

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

                           (a)      Stock Dividends and Splits. If the Company,
                                    --------------------------
at any time while this Warrant is outstanding, (i) pays a stock dividend on its
Common Stock or otherwise makes a distribution on any class of capital stock
that is payable in shares of Common Stock, except for regularly scheduled
dividends payable in the ordinary course of business in respect of any preferred
stock of the Company, (ii) subdivides outstanding shares of Common Stock into a
larger number of shares, or (iii) combines outstanding shares of Common Stock
into a smaller number of shares, then in each such case the Exercise Price shall
be multiplied by a fraction of which the numerator shall be the number of shares
of Common Stock outstanding immediately before such event and of which the
denominator shall be the number of shares of Common Stock outstanding
immediately after such event.

                           (b)      Pro Rata Distributions. If the Company, at
                                    ----------------------
any time while this Warrant is outstanding, distributes to all holders of Common
Stock (i) evidences of its indebtedness, (ii) any security (other than a
distribution of Common Stock covered by the preceding paragraph), (iii) rights
or warrants to subscribe for or purchase any security, or (iv) any other asset
(in each case, "Distributed Property"), then, at the request of any Holder
                --------------------
delivered before the 90th day after the record date fixed for determination of
stockholders entitled to receive such distribution, the Company will deliver to
such Holder, within five Trading Days after such request (or, if later, on the
effective date of such distribution), the Distributed Property that such Holder
would have been entitled to receive in respect of the Warrant Shares for which
such Holder's Warrant could have been exercised immediately prior to such record
date. If such Distributed Property is not delivered to a Holder pursuant to the
preceding sentence, then upon any exercise of the Warrant that occurs after such
record date,

                                      4

<PAGE>

such Holder shall be entitled to receive, in addition to the Warrant Shares
otherwise issuable upon such conversion, the Distributed Property that such
Holder would have been entitled to receive in respect of such number of Warrant
Shares had the Holder been the record holder of such Warrant Shares immediately
prior to such record date.

                           (c)      Fundamental Transactions. If, at any time
                                    ------------------------
while this Warrant is outstanding: (i) the Company effects any merger or
consolidation of the Company with or into another Person, (ii) the Company
effects any sale of all or substantially all of its assets in one or a series of
related transactions, (iii) any tender offer or exchange offer (whether by the
Company or another Person) is completed pursuant to which holders of Common
Stock are permitted to tender or exchange their shares for other securities,
cash or property, or (iv) the Company effects any reclassification of the Common
Stock or any compulsory share exchange pursuant to which the Common Stock is
effectively converted into or exchanged for other securities, cash or property
(in any such case, a "Fundamental Transaction"), then the Holder shall have the
                      -----------------------
right thereafter to receive, upon exercise of this Warrant, the same amount and
kind of securities, cash or property as it would have been entitled to receive
upon the occurrence of such Fundamental Transaction if it had been, immediately
prior to such Fundamental Transaction, the holder of the number of Warrant
Shares then issuable upon exercise in full of this Warrant (the "Alternate
                                                                 ---------
Consideration"). For purposes of any such exercise, the determination of the
-------------
Exercise Price shall be appropriately adjusted to apply to such Alternate
Consideration based on the amount of Alternate Consideration issuable in respect
of one share of Common Stock in such Fundamental Transaction, and the Company
shall apportion the Exercise Price among the Alternate Consideration in a
reasonable manner reflecting the relative value of any different components of
the Alternate Consideration. If holders of Common Stock are given any choice as
to the securities, cash or property to be received in a Fundamental Transaction,
then the Holder shall be given the same choice as to the Alternate Consideration
it receives upon any exercise of this Warrant following such Fundamental
Transaction. At the Company's option, any successor to the Company or surviving
entity in such Fundamental Transaction shall, either (i) issue to the Holder a
new warrant substantially in the form of this Warrant and consistent with the
foregoing provisions and evidencing the Holder's right to purchase the Alternate
Consideration for the aggregate Exercise Price upon exercise thereof, or (ii)
purchase the Warrant from the Holder for a purchase price, payable in cash
within five Trading Days after such request (or, if later, on the effective date
of the Fundamental Transaction), equal to the Black Scholes value (determined
using the Holder's underlying assumptions) of the remaining unexercised portion
of this Warrant on the date of such request. The terms of any agreement pursuant
to which a Fundamental Transaction is effected shall include terms requiring any
such successor or surviving entity to comply with the provisions of this
paragraph (c) and insuring that the Warrant (or any such replacement security)
will be similarly adjusted upon any subsequent transaction analogous to a
Fundamental Transaction.

                           (d)      Subsequent Equity Sales.
                                    -----------------------

                                       (i)    If the Company or any subsidiary
thereof, as applicable with respect to Common Stock Equivalents (as defined
below), at any time while this Warrant is outstanding, shall issue shares of
Common Stock or rights, warrants (including those issued under the purchase
agreement pursuant to which this Warrant was issued), options or other

                                      5

<PAGE>

securities or debt that is convertible into or exchangeable for shares of Common
Stock ("Common Stock Equivalents") entitling any Person to acquire shares of
        ------------------------
Common Stock, at a price per share less than the Exercise Price (if the holder
of the Common Stock or Common Stock Equivalent so issued shall at any time,
whether by operation of purchase price adjustments, reset provisions, floating
conversion, exercise or exchange prices or otherwise, or due to warrants,
options or rights issued in connection with such issuance, be entitled to
receive shares of Common Stock at a price less than the Exercise Price, such
issuance shall be deemed to have occurred for less than the Exercise Price),
then, at the option of the Holder for such exercises as it shall indicate, the
Exercise Price shall be adjusted to equal the conversion, exchange or purchase
price for such Common Stock or Common Stock Equivalents (including any reset
provisions thereof) at issue. Such adjustment shall be made whenever such Common
Stock or Common Stock Equivalents are issued. The Company shall notify the
Holder in writing, no later than the Trading Day following the issuance of any
Common Stock or Common Stock Equivalent subject to this section, indicating
therein the applicable issuance price, or of applicable reset price, exchange
price, conversion price and other pricing terms. Notwithstanding the foregoing,
no adjustment will be made under this Section in respect of: (i) the granting of
options to employees, officers and directors of the Company pursuant to any
stock option plan duly adopted by the Company or to the issuance of Common Stock
upon exercise of such options or (ii) a bona fide underwritten public offering
of the Common Stock (it being understood that equity line transactions,
including any on-going warrant financing, or any similar arrangements shall not
constitute a bona fide underwritten public offering of the Common Stock for the
purposes hereof).

                                       (ii)   If, at any time while this Warrant
is outstanding, the Company or any Subsidiary issues Common Stock Equivalents at
a price per share that floats or resets or otherwise varies or is subject to
adjustment based on market prices of the Common Stock (a "Floating Price
                                                          --------------
Security"), then for purposes of applying the preceding paragraph in connection
--------
with any subsequent exercise, the Exercise Price will be determined separately
on each Exercise Date and will be deemed to equal the lowest price per share at
which any holder of such Floating Price Security is entitled to acquire shares
of Common Stock on such Exercise Date (regardless of whether any such holder
actually acquires any shares on such date).

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

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

                           (g)      Notice of Adjustments. Upon the occurrence
                                    ---------------------
of each adjustment pursuant to this Section 9, the Company at its expense will
                                    ---------
promptly compute such adjustment in

                                      6

<PAGE>

accordance with the terms of this Warrant and prepare a certificate setting
forth such adjustment, including a statement of the adjusted Exercise Price and
adjusted number or type of Warrant Shares or other securities issuable upon
exercise of this Warrant (as applicable), describing the transactions giving
rise to such adjustments and showing in detail the facts upon which such
adjustment is based. Upon written request, the Company will promptly deliver a
copy of each such certificate to the Holder and to the Company's Transfer Agent.

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

                  10.      Payment of Exercise Price. The Holder shall pay the
                           -------------------------
Exercise Price in one of the following manners:

                           (a)      Cash Exercise. The Holder may deliver
                                    -------------
immediately available funds; or

                           (b)      Cashless Exercise. The Holder may surrender
                                    -----------------
this Warrant to the Company together with a notice of cashless exercise, in
which event the Company shall issue to the Holder the number of Warrant Shares
determined as follows

                                    X = Y [(A-B)/A]
                  where:
                                    X = the number of Warrant Shares to be
                                    issued to the Holder.

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

                                    A = the average of the closing bid prices
                                    for the five Trading Days immediately prior
                                    to (but not including) the Exercise Date.
                                    B = the Exercise Price.

                  For purposes of Rule 144 promulgated under the Securities Act,
it is intended, understood and acknowledged that the Warrant Shares issued in a
cashless exercise transaction shall be deemed to have been acquired by the
Holder, and the holding period for the Warrant

                                      7

<PAGE>

Shares shall be deemed to have commenced, on the date this Warrant was
originally issued pursuant to the Purchase Agreement.

                  11.      Limitations on Exercise.
                           -----------------------

                           (a)      Notwithstanding anything to the contrary
contained herein, the number of shares of Common Stock that may be acquired by
the Holder upon any exercise of this Warrant (or otherwise in respect hereof)
shall be limited to the extent necessary to insure that, following such exercise
(or other issuance), the total number of shares of Common Stock then
beneficially owned by such Holder and its Affiliates and any other Persons whose
beneficial ownership of Common Stock would be aggregated with the Holder's for
purposes of Section 13(d) of the Exchange Act, does not exceed 4.999% of the
total number of issued and outstanding shares of Common Stock (including for
such purpose the shares of Common Stock issuable upon such exercise). Each
delivery of an Exercise Notice hereunder will constitute a representation by the
Holder that it has evaluated the limitation set forth in this paragraph and
determined that issuance of the full number of Warrant Shares issuable in
respect of such Exercise Notice does not violate the restrictions contained in
this paragraph. This provision shall not restrict the number of shares of Common
Stock which a Holder may receive or beneficially own in order to determine the
amount of securities or other consideration that such Holder may receive in the
event of a merger, sale or other business combination or reclassification
involving the Company as contemplated herein. The provisions of this Section may
be waived by a Holder (but only as to itself and not to any other Holder) upon
not less than 61 days' prior notice to the Company. Other Holders shall be
unaffected by any such waiver.

                           (b)      Notwithstanding anything to the contrary
contained herein, the number of shares of Common Stock that may be acquired by
the Holder upon any exercise of this Warrant (or otherwise in respect hereof)
shall be limited to the extent necessary to insure that, following such exercise
(or other issuance), the total number of shares of Common Stock then
beneficially owned by such Holder and its Affiliates and any other Persons whose
beneficial ownership of Common Stock would be aggregated with the Holder's for
purposes of Section 13(d) of the Exchange Act, does not exceed 9.999% of the
total number of issued and outstanding shares of Common Stock (including for
such purpose the shares of Common Stock issuable upon such exercise). Each
delivery of an Exercise Notice hereunder will constitute a representation by the
Holder that it has evaluated the limitation set forth in this paragraph and
determined that issuance of the full number of Warrant Shares issuable in
respect of such Exercise Notice does not violate the restrictions contained in
this paragraph. This provision shall not restrict the number of shares of Common
Stock which a Holder may receive or beneficially own in order to determine the
amount of securities or other consideration that such Holder may receive in the
event of a merger, sale or other business combination or reclassification
involving the Company as contemplated herein.

                           (c)      If the Company has not previously obtained
the Shareholder Approval (as defined below), then the Company may not issue in
excess of the Issuable Maximum upon exercise of this Warrant at a price per
share that is less than the Closing Price on the Trading Day immediately
preceding the Closing Date (other than to the extent such price per share is
reached due to adjustments to the Exercise Price due to stock splits of the
Common

                                      8

<PAGE>

Stock). The "Issuable Maximum" means a number of shares of Common Stock equal to
             ----------------
3,838,413 (which equals 19.99% of the number of shares of Common Stock
outstanding on the Trading Day immediately preceding the Closing Date), less a
number of shares equal to the shares of Common Stock previously issued: (x) to
the Purchasers under the Purchase Agreement and (y) upon exercise of any
Warrants, in each case of (x) and (y) at a price per share that is less than the
Closing Price on the Trading Date immediately preceding the Closing Date (other
than to the extent such price per share is reached due to adjustments to the
Exercise Price due to stock splits of the Common Stock) (the "Threshold Price").
                                                              ---------------
Each Holder shall be entitled to a portion of the Issuable Maximum equal to the
quotient obtained by dividing: (x) the number of shares of Common Stock issued
and sold to the Holder on the Closing Date by (y) the aggregate number of shares
of Common Stock issued and sold by the Company on the Closing Date. If this
Warrant shall have been fully exercised, then the Holder's remaining portion of
the Issuable Maximum shall be allocated pro-rata among the remaining holders of
Warrants. If on any Exercise Date: (A) the Exercise Price then in effect is less
than the Threshold Price and the aggregate number of shares of Common Stock that
would then be issuable upon exercise in full of all then outstanding Warrants,
together with any shares of Common Stock previously issued to the Purchasers at
Closing under the Purchase Agreement upon exercise of Warrants at a price below
the Threshold Price would exceed the Issuable Maximum, and (B) the Company shall
not have previously obtained the vote of shareholders, as may be required by the
applicable rules and regulations of the American Stock Exchange (or any
successor entity or, if the Common Stock is not then traded on the American
Stock Exchange, such other exchange or trading facility on which the Common
Stock is then quoted or listed for trading) applicable to approve the issuance
of shares of Common Stock in excess of the Issuable Maximum pursuant to the
terms hereof (the "Shareholder Approval"), then the Company shall issue to the
                   --------------------
Holder a number of shares of Common Stock equal to its pro-rata portion (which
shall be calculated pursuant to the terms hereof) of the Issuable Maximum and,
with respect to the remainder of the Warrant Shares then underlying this Warrant
for which an exercise in accordance with the Exercise Price would result in an
issuance of shares of Common Stock in excess of the Holder's pro-rata portion
(which shall be calculated pursuant to the terms hereof) of the Issuable Maximum
(the "Excess Warrant Shares"), the Holder shall have the right to require the
      ---------------------
Company to either: (1) obtain the Shareholder Approval applicable to such
issuance as soon as is possible, but in any event not later than the 110th day
after such request, or (2) pay cash, as liquidated damages and not as a penalty,
to the Holder in an amount equal to the product of (x) the Excess Warrant Shares
and (y) the greater of (i) the Closing Price on the applicable Exercise Date and
(ii) the Closing Price on the date the cash payment is paid in full, less the
Exercise Price for the Excess Warrant Shares to the extent not previously paid
by the Holder (the "Mandatory Amount"). If a Holder shall have elected the first
                    ----------------
option pursuant to the immediately preceding sentence and the Company shall have
failed to obtain the Shareholder Approval on or prior to the 110th day after
such request, then within three (3) days of such 110th day, the Company shall
pay cash to the Holder in an amount equal to the Mandatory Amount, as liquidated
damages and not as a penalty. Any such payment of the Mandatory Amount shall be
deemed to constitute the Holder's exercise in full of the Excess Warrant Shares.
The Company and the Holder understand and agree that shares of Common Stock
issued to and then held by the Holder as a result of the exercise of this
Warrant shall not be entitled to cast votes on any resolution to obtain the
Shareholder Approval pursuant hereto.

                                      9

<PAGE>

                  12.      No Fractional Shares. No fractional shares of Warrant
                           --------------------
Shares will be issued in connection with any exercise of this Warrant. In lieu
of any fractional shares which would, otherwise be issuable, the Company shall
pay cash equal to the product of such fraction multiplied by the closing bid
price of one Warrant Share as reported on the American Stock Exchange on the
date of exercise.

                  13.      Notices. Any and all notices or other communications
                           -------
or deliveries hereunder (including without limitation any Exercise Notice) shall
be in writing and shall be deemed given and effective on the earliest of (i) the
date of transmission, if such notice or communication is delivered via facsimile
at the facsimile number specified in this Section prior to 6:30 p.m. (New York
City time) on a Trading Day, (ii) the next Trading Day after the date of
transmission, if such notice or communication is delivered via facsimile at the
facsimile number specified in this Section on a day that is not a Trading Day or
later than 6:30 p.m. (New York City time) on any Trading Day, (iii) the Trading
Day following the date of mailing, if sent by nationally recognized overnight
courier service, or (iv) upon actual receipt by the party to whom such notice is
required to be given. The addresses for such communications shall be: (i) if to
the Company, to 11 Riverside Street, Nashua, NH 03062-1373, Facsimile No.: (603)
889-7232, Attn: Chief Financial Officer, or (ii) if to the Holder, to the
address or facsimile number appearing on the Warrant Register or such other
address or facsimile number as the Holder may provide to the Company in
accordance with this Section.

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

                  15.      Miscellaneous.
                           -------------

                           (a)      This Warrant shall be binding on and inure
to the benefit of the parties hereto and their respective successors and
assigns. Subject to the preceding sentence, nothing in this Warrant shall be
construed to give to any Person other than the Company and the Holder any legal
or equitable right, remedy or cause of action under this Warrant. This Warrant
may be amended only in writing signed by the Company and the Holder and their
successors and assigns.

                           (b)      All questions concerning the construction,
validity, enforcement and interpretation of this Warrant shall be governed by
and construed and enforced in accordance with the internal laws of the State of
New York, without regard to the principles of conflicts of law thereof. Each
party agrees that all legal proceedings concerning the interpretations,
enforcement and defense of the transactions contemplated by this Warrant
(whether brought against a party hereto or its respective affiliates, directors,
officers, shareholders, employees or agents) shall be commenced in the state and
federal courts sitting in the City of New York,

                                      10

<PAGE>

Borough of Manhattan. Each party hereto hereby irrevocably submits to the
exclusive jurisdiction of the state and federal courts sitting in the City of
New York, Borough of Manhattan for the adjudication of any dispute hereunder or
in connection herewith or with any transaction contemplated hereby or discussed
herein (including with respect to the enforcement of this Warrant), and hereby
irrevocably waives, and agrees not to assert in any suit, action or proceeding,
any claim that it is not personally subject to the jurisdiction of any such
court, that such suit, action or proceeding is improper. Each party hereto
hereby irrevocably waives personal service of process and consents to process
being served in any such suit, action or proceeding by mailing a copy thereof
via registered or certified mail or overnight delivery (with evidence of
delivery) to such party at the address in effect for notices to it under this
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.
Each party hereto (including its affiliates, agents, officers, directors and
employees) hereby irrevocably waives, to the fullest extent permitted by
applicable law, any and all right to trial by jury in any legal proceeding
arising out of or relating to this Warrant or the transactions contemplated
hereby. If either party shall commence an action or proceeding to enforce any
provisions of this Warrant, then the prevailing party in such action or
proceeding shall be reimbursed by the other party for its attorneys fees and
other costs and expenses incurred with the investigation, preparation and
prosecution of such action or proceeding.

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

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

                 [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK,
                           SIGNATURE PAGE FOLLOWS]

                                      11

<PAGE>

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

                                              STORAGE COMPUTER CORPORATION

                                              By:    /  S  /
                                              Name:  Peter N. Hood
                                              Title: Chief Financial Officer

                                      12

<PAGE>

                          FORM OF ELECTION TO PURCHASE

To Storage Computer Corporation:

         In accordance with Warrant No. [ ] issued to the undersigned, the
undersigned hereby elects to purchase _____________ shares of common stock
("Common Stock"), $.001 par value per share, of Storage Computer Corporation,
and, if such Holder is not utilizing the cashless exercise provisions set forth
in this Warrant, encloses herewith $________ in cash, certified or official bank
check or checks, which sum represents the aggregate Exercise Price (as defined
in the Warrant) for the number of shares of Common Stock to which this Form of
Election to Purchase relates.

         By its delivery of this Form of Election To Purchase, the Holder
represents and warrants to the Company that in giving effect to the exercise
evidenced hereby the Holder will not beneficially own in excess of the number of
shares of Common Stock (determined in accordance with Section 13(d) of the
Securities Exchange Act of 1934) permitted to be owned under Section 11 of this
Warrant to which this notice relates.

         The undersigned requests that certificates for the shares of Common
Stock issuable upon this exercise be issued in the name of

                                            PLEASE INSERT SOCIAL SECURITY OR TAX
                                            IDENTIFICATION NUMBER

                         (Please print name and address)

                                      13

<PAGE>

                           Warrant Shares Exercise Log
                           ---------------------------

<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------
Date                   Number of Warrant Shares            Number of Warrant Shares        Number of Warrant Shares
                       Available to be Exercised           Exercised                       Remaining to be Exercised
----------------------------------------------------------------------------------------------------------------------
<S>                    <C>                                 <C>                             <C>

----------------------------------------------------------------------------------------------------------------------
</TABLE>

                                      14

<PAGE>

                               FORM OF ASSIGNMENT

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

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

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

                            Address of Transferee

In the presence of:

                                      15

<PAGE>

                             LIST OF WARRANT HOLDERS

..    ZLP Master Technology Fund
     45 Broadway - 28th floor
     New York, NY 10006
     Number of warrants                           100,000
     Warrant Number                                #CSW-1

..    Alpha Capital Aktiengesellschaft
     Pradafant 7
     Furstentums 9490
     Vaduz, Liechtenstein
     Number of warrants                            60,000
     Warrant Number                                #CSW-2

              Mail all Documents to:
              LH Financial
              160 Central Park South, Suite 2701
              New York, NY 10019
              Att: Mr. Brian Shatz

..    Euram Cap Strat. "A" Fund Limited
     666 Dundee Rd, Suite 1901
     Northbrook, IL 60062
     Number of warrants                            40,000
     Warrant Number                                #CSW-3

..    Crescent International Ltd.
     c/o GreenLight (Switzerland) S.A.
     84, av. Louis-Casai
     P.O. Box 161
     CH - 1216 Cointrin/Geneva
     Switzerland
     Number of warrants                            40,000
     Warrant Number                                #CSW-4

..    Dunwoody Brokerage Services, Inc.
     4243 Dunwoody Club Drive, Suite 200
     Atlanta, GA 30350
     Number of warrants                            20,000
     Warrant Number                                #CSW-5

                                      16

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