Document:

ex4_4.htm

    
      

    

    

      EXHIBIT
4.4

      

      FIRST
AMENDMENT

      TO

      KNIGHT
TRANSPORTATION, INC.

      AMENDED
AND RESTATED

      2003
STOCK OPTION PLAN

      

      

      This
First Amendment (the “Amendment”) to the Knight Transportation, Inc. Amended and
Restated 2003 Stock Option Plan (the “Plan”) shall be effective as of the
14th
day of February, 2007.

      

      Recitals:

      

      A.           The
Board of Directors of Knight Transportation, Inc. (the “Company”) established
the Plan in 1994 to attract and retain its executives, directors and key
employees.

       

      B.           The
Board of Directors has determined that it is in the best interests of the
Company to eliminate the automatic grant of stock options to Independent
Directors and to replace those with a restricted stock grant.

       

      C.           The
Board of Directors has determined that it is in the best interests of the
Company to pay one-half of the Directors’ annual fees in Company stock on the
date of the Company’s Annual Meeting of the Board of Directors occurring in May
of each calendar year.

       

      D.           The
Board of Directors has determined that it is in the best interests of the
Company to require that shares issued as Director compensation not be sold by an
individual while he or she is acting as a Director.

       

      E.           Pursuant
to the authority granted in Section 8.16 of the Plan, the Board of Directors, on
behalf of the Company, adopts the following amendment to the Plan, effective as
of May 24, 2007:

      

      Amendment:

      

      1.           Section
6.1 of the Plan is hereby deleted.

      

      2.           Sections
6.2 through 6.5 are hereby denominated as Sections 6.1 through 6.4.

      

      3.           Section
6.2 of the Plan, as denominated above, is hereby deleted and the following is
substituted therefore:

      

      6.2         Holding
Period.  Any Stock Grant made to an Independent Director may
not be sold at any time while the individual is a Director of the Company,
without the Director obtaining the prior consent of the Compensation
Committee.

      
        
           

        

        
          
          

          
            

          

        

        
           

        

      

      4.           Section
6.4 of the Plan, as denominated above, is hereby amended and the following is
substituted therefore:

      

      6.4         Payment
of Director’s Fees in Stock.  The Company shall pay one-half of
the director’s fees due any Independent Director in Stock of the
Company.  The Company shall issue to each Independent Director at the
Annual Meeting of the Board of Directors occurring in May of each calendar year
the number of shares of Company Stock (disregarding any fraudulent shares) equal
to one-half of the director’s fees due such Independent Director for services
performed as of the date of issuance, based on the Fair Market Value of the
Company’s Stock, as provided in Section 5.3(c) above, at the closing price as of
the day such grant is awarded.  Each Director shall be deemed to have
earned the stock issued to such Director as of the date of the Annual
Meeting.

      

      5.           The
foregoing First Amendment to the Plan was approved by the Company’s Board of
Directors at the Quarterly Meeting of the Board of Directors on February 14,
2007, to be effective for calendar years from and after January 1,
2007.

       

      6.           Except
as amended by this Amendment, the Plan shall continue in full force and effect
as previously constituted and amended.

      

      DATED
this 24th day of May, 2007.

      

      
        	 
      	
                KNIGHT
      TRANSPORTATION, INC., an Arizona corporation

              
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
                By:

              	
                /s/
      Kevin P. Knight,

              
	 
      	 
      	
                Kevin
      P. Knight,

              
	 
      	 
      	
                Chief
      Executive Officer

              
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
                By:

              	
                /s/
      Timothy M. Kohl,

              
	 
      	 
      	
                Timothy
      M. Kohl,

              
	 
      	 
      	
                President
      and SecretaryExhibit
      4.1

    

      Warrant
        No. ____ 

       

      NEITHER
        THIS SECURITY NOR THE SECURITIES FOR WHICH THIS SECURITY IS 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. THIS SECURITY
        AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS SECURITY MAY BE PLEDGED
        IN
        CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH
        SECURITIES.

      

      COMMON
        STOCK PURCHASE WARRANT

      

      SJ
        ELECTRONICS, INC.

      

        
          	
                  Warrant
                    Shares: __________

                	
                  Initial
                    Exercise Date: February 13,
                    2008

                

        

      

       

      THIS
        COMMON STOCK PURCHASE WARRANT (the “Warrant”)
        certifies that, for value received, _____________ (the “Holder”)
        is
        entitled, upon the terms and subject to the limitations on exercise and the
        conditions hereinafter set forth, at any time on or after the date hereof
        (the
“Initial
        Exercise Date”)
        and on
        or prior to the close of business on the five year anniversary of the Initial
        Exercise Date (the “Termination
        Date”)
        but
        not thereafter, to subscribe for and purchase from SJ Electronics, Inc.,
        a
        Nevada corporation (the “Company”),
        up to
        ___________ shares (the “Warrant
        Shares”)
        of
        Common Stock. The purchase price of one share of Common Stock under this
        Warrant
        shall be equal to the Exercise Price, as defined in Section 2(b). 

       

      Section
        1. Definitions.
        Capitalized terms used and not otherwise defined herein shall have the meanings
        set forth in that certain Securities Purchase Agreement (the “Purchase
        Agreement”),
        dated
        November 30, 2007, by and among Shing Mei Enterprises Limited (“Shing Mei”) and
        the purchasers signatory thereto, and the Securities Exchange Agreement (the
        “Exchange Agreement”), dated February 12, 2008 by and among the Company, Shing
        Mei and the shareholders of Shing Mei named therein.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      Section
        2. Exercise.

       

      a)  Exercise
        of Warrant.
        Exercise of the purchase rights represented by this Warrant may be made,
        in
        whole or in part, at any time or times on or after the Initial Exercise Date
        and
        on or before the Termination Date by delivery to the Company of a duly executed
        facsimile copy of the Notice of Exercise Form annexed hereto (or such other
        office or agency of the Company as it may designate by notice in writing
        to the
        registered Holder at the address of the Holder appearing on the books of
        the
        Company); and, within 3 Trading Days of the date said Notice of Exercise
        is
        delivered to the Company, the Company shall have received payment of the
        aggregate Exercise Price of the shares thereby purchased by wire transfer
        or
        cashier’s check drawn on a United States bank. Notwithstanding anything herein
        to the contrary, the Holder shall not be required to physically surrender
        this
        Warrant to the Company until the Holder has purchased all of the Warrant
        Shares
        available hereunder and the Warrant has been exercised in full, in which
        case,
        the Holder shall surrender this Warrant to the Company for cancellation within
        3
        Trading Days of the date the final Notice of Exercise is delivered to the
        Company. Partial exercises of this Warrant resulting in purchases of a portion
        of the total number of Warrant Shares available hereunder shall have the
        effect
        of lowering the outstanding number of Warrant Shares purchasable hereunder
        in an
        amount equal to the applicable number of Warrant Shares purchased. The Holder
        and the Company shall maintain records showing the number of Warrant Shares
        purchased and the date of such purchases. The Company shall deliver any
        objection to any Notice of Exercise Form within 1 Business Day of receipt
        of
        such notice. In the event of any dispute or discrepancy, the records of the
        Holder shall be controlling and determinative in the absence of manifest
        error.
The
        Holder and any assignee, by acceptance of this Warrant, acknowledge and agree
        that, by reason of the provisions of this paragraph, following the purchase
        of a
        portion of the Warrant Shares hereunder, the number of Warrant Shares available
        for purchase hereunder at any given time may be less than the amount stated
        on
        the face hereof.

       

      b)  Exercise
        Price.
        The
        exercise price per share of the Common Stock under this Warrant shall be
        $1.00,
        subject
        to adjustment hereunder (the “Exercise
        Price”).

       

      c)  Cashless
        Exercise.
        If at
        any time after the completion of the then-applicable holding period required
        by
        Rule 144, or any successor provision then in effect, there is no effective
        Registration Statement registering, or no current prospectus available for,
        the
        resale of the Warrant Shares by the Holder, then this Warrant may also be
        exercised at such time by means of a “cashless exercise” in which the Holder
        shall be entitled to receive a certificate for the number of Warrant Shares
        equal to the quotient obtained by dividing [(A-B) (X)] by (A),
        where:

       

      (A)
        = the
        average closing price of the Common Stock for the ten Trading Days ending
        on the
        day immediately preceding the date of such election;

      

      (B)
        = the
        Exercise Price of this Warrant, as adjusted; and 

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      (X)
        = the
        number of Warrant Shares issuable upon exercise of this Warrant in accordance
        with the terms of this Warrant by means of a cash exercise rather than a
        cashless exercise.

      

      Notwithstanding
        anything herein to the contrary, on the Termination Date, this Warrant shall
        be
        automatically exercised via cashless exercise pursuant to this Section
        2(c).

      

      d)  Exercise
        Limitations.
        The
        Company shall not effect any exercise of this Warrant, and a Holder shall
        not
        have the right to exercise any portion of this Warrant, pursuant to Section
        2 or
        otherwise, to the extent that after giving effect to such issuance after
        exercise as set forth on the applicable Notice of Exercise, the Holder (together
        with the Holder’s Affiliates, and any other person or entity acting as a group
        together with the Holder or any of the Holder’s Affiliates), would beneficially
        own in excess of the Beneficial Ownership Limitation (as defined below). 
For purposes of the foregoing sentence, the number of shares of Common Stock
        beneficially owned by the Holder and its Affiliates shall include the number
        of
        shares of Common Stock issuable upon exercise of this Warrant with respect
        to
        which such determination is being made, but shall exclude the number of shares
        of Common Stock which would be issuable upon (A) exercise of the remaining,
        nonexercised portion of this Warrant beneficially owned by the Holder or
        any of
        its Affiliates and (B) exercise or conversion of the unexercised or nonconverted
        portion of any other securities of the Company (including, without limitation,
        any other Common Stock Equivalents) subject to a limitation on conversion
        or
        exercise analogous to the limitation contained herein beneficially owned
        by the
        Holder or any of its affiliates.  Except as set forth in the preceding
        sentence, for purposes of this Section 2(d), beneficial ownership shall be
        calculated in accordance with Section 13(d) of the Exchange Act and the rules
        and regulations promulgated thereunder, it being acknowledged by the Holder
        that
        the Company is not representing to the Holder that such calculation is in
        compliance with Section 13(d) of the Exchange Act and the Holder is solely
        responsible for any schedules required to be filed in accordance therewith.
        To
        the extent that the limitation contained in this Section 2(d) applies, the
        determination of whether this Warrant is exercisable (in relation to other
        securities owned by the Holder together with any Affiliates) and of which
        portion of this Warrant is exercisable shall be in the sole discretion of
        the
        Holder, and the submission of a Notice of Exercise shall be deemed to be
        the
        Holder’s determination of whether this Warrant is exercisable (in relation to
        other securities owned by the Holder together with any Affiliates) and of
        which
        portion of this Warrant is exercisable, in each case subject to the Beneficial
        Ownership Limitation, and the Company shall have no obligation to verify
        or
        confirm the accuracy of such determination. In addition, a determination
        as to
        any group status as contemplated above shall be determined in accordance
        with
        Section 13(d) of the Exchange Act and the rules and regulations promulgated
        thereunder. For purposes of this Section 2(d), in determining the number
        of
        outstanding shares of Common Stock, a Holder may rely on the number of
        outstanding shares of Common Stock as reflected in (x) the Company’s most recent
        periodic or annual report, as the case may be, (y) a more recent public
        announcement by the Company or (z) any other notice by the Company or the
        Company’s Transfer Agent setting forth the number of shares of Common Stock
        outstanding.  Upon the written or oral request of a Holder, the Company
        shall within two Trading Days confirm orally and in writing to the Holder
        the
        number of shares of Common Stock then outstanding.  In any case, the number
        of outstanding shares of Common Stock shall be determined after giving effect
        to
        the conversion or exercise of securities of the Company, including this Warrant,
        by the Holder or its Affiliates since the date as of which such number of
        outstanding shares of Common Stock was reported. The “Beneficial
        Ownership Limitation”
shall
        be 9.99% of the number of shares of the Common Stock outstanding immediately
        after giving effect to the issuance of shares of Common Stock issuable upon
        exercise of this Warrant. The provisions of this paragraph shall be construed
        and implemented in a manner otherwise than in strict conformity with the
        terms
        of this Section 2(d) to correct this paragraph (or any portion hereof) which
        may
        be defective or inconsistent with the intended Beneficial Ownership Limitation
        herein contained or to make changes or supplements necessary or desirable
        to
        properly give effect to such limitation. The limitations contained in this
        paragraph shall apply to a successor holder of this Warrant.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      e)  Mechanics
        of Exercise.
        

       

      i.  Delivery
        of Certificates Upon Exercise.
        Certificates for shares purchased hereunder shall be transmitted by the transfer
        agent of the Company to the Holder by crediting the account of the Holder’s
        prime broker with the Depository Trust Company through its Deposit Withdrawal
        Agent Commission (“DWAC”)
        system
        if the Company is a participant in such system and there is an effective
        Registration Statement permitting the resale of the Warrant Shares by the
        Holder, and otherwise by physical delivery to the address specified by the
        Holder in the Notice of Exercise within five (5) Trading Days from the delivery
        to the Company of the Notice of Exercise Form, surrender of this Warrant
        (if
        required) and payment of the aggregate Exercise Price as set forth above
        (“Warrant
        Share Delivery Date”).
        This
        Warrant shall be deemed to have been exercised on the date the Exercise Price
        is
        received by the Company. The Warrant Shares shall be deemed to have been
        issued,
        and Holder or any other person so designated to be named therein shall be
        deemed
        to have become a holder of record of such shares for all purposes, as of
        the
        date the Warrant has been exercised by payment to the Company of the Exercise
        Price (or by cashless exercise, if permitted) and all taxes required to be
        paid
        by the Holder, if any, pursuant to Section 2(e)(vi) prior to the issuance
        of
        such shares, have been paid. If the Company fails for any reason to deliver
        to
        the Holder certificates evidencing the Warrant Shares subject to a Notice
        of
        Exercise by the Warrant Share Delivery Date, the Company shall pay to the
        Holder, in cash, as liquidated damages and not as a penalty, for each $1,000
        of
        Warrant Shares subject to such exercise (based on the average closing price
        of
        the Common Stock for the ten Trading Days ending on the day immediately prior
        to
        the date of the applicable Notice of Exercise), $10 per Trading Day (increasing
        to $20 per Trading Day on the fifth Trading Day after such liquidated damages
        begin to accrue) for each Trading Day after such Warrant Share Delivery Date
        until such certificates are delivered. 

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      ii.  Delivery
        of New Warrants Upon Exercise.
        If this
        Warrant shall have been exercised in part, the Company shall, at the request
        of
        a Holder and upon surrender of this Warrant certificate, at the time of delivery
        of the certificate or certificates representing Warrant Shares, deliver to
        Holder a new Warrant evidencing the rights of Holder to purchase the unpurchased
        Warrant Shares called for by this Warrant, which new Warrant shall in all
        other
        respects be identical with this Warrant.

       

      iii.  Rescission
        Rights.
        If the
        Company fails to cause its transfer agent to transmit to the Holder a
        certificate or certificates representing the Warrant Shares pursuant to Section
        2(e)(i) by the Warrant Share Delivery Date, then the Holder will have the
        right
        to rescind such exercise..

       

      iv.  No
        Fractional Shares or Scrip.
        No
        fractional shares or scrip representing fractional shares shall be issued
        upon
        the exercise of this Warrant. As to any fraction of a share which Holder
        would
        otherwise be entitled to purchase upon such exercise, the Company shall at
        its
        election, either pay a cash adjustment in respect of such final fraction in an
        amount equal to such fraction multiplied by the Exercise Price or round up
        to
        the next whole share.

       

      v.  Charges,
        Taxes and Expenses.
        Issuance of certificates for Warrant Shares shall be made without charge
        to the
        Holder for any issue or transfer tax or other incidental expense in respect
        of
        the issuance of such certificate, all of which taxes and expenses shall be
        paid
        by the Company, and such certificates shall be issued in the name of the
        Holder
        or in such name or names as may be directed by the Holder; provided,
        however,
        that in
        the event certificates for Warrant Shares are to be issued in a name other
        than
        the name of the Holder, this Warrant when surrendered for exercise shall
        be
        accompanied by the Assignment Form attached hereto duly executed by the Holder;
        and the Company may require, as a condition thereto, the payment of a sum
        sufficient to reimburse it for any transfer tax incidental thereto.

       

      vi.  Closing
        of Books.
        The
        Company will not close its stockholder books or records in any manner which
        prevents the timely exercise of this Warrant, pursuant to the terms
        hereof.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      f)  Call
        Provision.
        Subject
        to the provisions of Section 2(d) and this Section 2(f), if, after the Effective
        Date, (i) the average closing price of the Common Stock for ten consecutive
        Trading Days (the “Measurement
        Period,”
which
        period shall not have commenced until after the Effective Date) exceeds $2.00
        (subject to adjustment for forward and reverse stock splits, recapitalizations,
        stock dividends and the like after the Initial Exercise Date), (ii) the average
        daily volume of the Common Stock for such Measurement Period exceeds 50,000
        shares of Common Stock per Trading Day (subject to adjustment for forward
        and
        reverse stock splits, recapitalizations, stock dividends and the like after
        the
        Initial Exercise Date), (iii) the Holder is not in possession of any information
        that constitutes, or might constitute, material non-public information which
        was
        provided by the Company, and (iv) there is an effective Registration Statement
        pursuant to which the Holder is permitted to utilize the prospectus thereunder
        to resell all of the shares issuable pursuant to the Transaction Documents
        (and
        the Company believes, in good faith, that such effectiveness will continue
        uninterrupted for the foreseeable future), then the Company may, within 1
        Trading Day of the end of such Measurement Period, call for cancellation
        of all
        or any portion of this Warrant for which a Notice of Exercise has not yet
        been
        delivered (such right, a “Call”)
        for
        consideration equal to $.001 per Share. To exercise this right, the Company
        must
        deliver to the Holder an irrevocable written notice (a “Call
        Notice”),
        indicating therein the portion of unexercised portion of this Warrant to
        which
        such notice applies. If the conditions set forth below for such Call are
        satisfied from the period from the date of the Call Notice through and including
        the Call Date (as defined below), then any portion of this Warrant subject
        to
        such Call Notice for which a Notice of Exercise shall not have been received
        by
        the Call Date will be cancelled at 6:30 p.m. (New York City time) on the
        fifth
        Trading Day after the date the Call Notice is received by the Holder (such
        date
        and time, the “Call
        Date”).
        Any
        unexercised portion of this Warrant to which the Call Notice does not pertain
        will be unaffected by such Call Notice. In furtherance thereof, the Company
        covenants and agrees that it will honor all Notices of Exercise with respect
        to
        Warrant Shares subject to a Call Notice that are tendered through 6:30 p.m.
        (New
        York City time) on the Call Date. 

       

      Section
        3. Certain
        Adjustments.

       

      a)  Stock
        Dividends and Splits.
        If the
        Company, at any time while this Warrant is outstanding: (A) pays a stock
        dividend or otherwise make a distribution or distributions on shares of its
        Common Stock or any other equity or equity equivalent securities payable
        in
        shares of Common Stock (which, for avoidance of doubt, shall not include
        any
        shares of Common Stock issued by the Company upon exercise of this Warrant),
        (B)
        subdivides outstanding shares of Common Stock into a larger number of shares,
        (C) combines (including by way of reverse stock split) outstanding shares
        of
        Common Stock into a smaller number of shares, or (D) issues by reclassification
        of shares of the Common Stock any shares of capital stock of the Company,
        then
        in each case the Exercise Price shall be multiplied by a fraction of which
        the
        numerator shall be the number of shares of Common Stock (excluding treasury
        shares, if any) outstanding immediately before such event and of which the
        denominator shall be the number of shares of Common Stock outstanding
        immediately after such event and the number of shares issuable upon exercise
        of
        this Warrant shall be proportionately adjusted such that the aggregate Exercise
        Price of this Warrant shall remain unchanged. Any adjustment made pursuant
        to
        this Section 3(a) shall become effective immediately after the record date
        for
        the determination of stockholders entitled to receive such dividend or
        distribution and shall become effective immediately after the effective date
        in
        the case of a subdivision, combination or re-classification.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      b)  Subsequent
        Equity Sales.
        If the
        Company or any Subsidiary thereof, as applicable, at any time while this
        Warrant
        is outstanding, shall sell or grant any option to purchase, or sell or grant
        any
        right to reprice, or otherwise dispose of or issue (or announce any offer,
        sale,
        grant or any option to purchase or other disposition) any Common Stock or
        Common
        Stock Equivalents entitling any Person to acquire shares of Common Stock,
        at an
        effective price per share less than the then Exercise Price (such lower price,
        the “Base
        Share Price”
and
        such issuances collectively, a “Dilutive
        Issuance”)
        (if
        the holder of the Common Stock or Common Stock Equivalents 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 per share which are issued in connection with
        such
        issuance, be entitled to receive shares of Common Stock at an effective price
        per share which is less than the Exercise Price, such issuance shall be deemed
        to have occurred for less than the Exercise Price on such date of the Dilutive
        Issuance), then the Exercise Price shall be reduced and only reduced to equal
        the Base Share Price. Additionally, the number of Warrant Shares issuable
        hereunder shall be increased such that the aggregate Exercise Price payable
        hereunder, after taking into account the decrease in the Exercise Price,
        shall
        be equal to the aggregate Exercise Price prior to such adjustment. Such
        adjustment shall be made whenever such Common Stock or Common Stock Equivalents
        are issued. Notwithstanding the foregoing, no adjustments shall be made,
        paid or
        issued under this Section 3(b) in respect of an Exempt Issuance. The Company
        shall notify the Holder in writing, no later than the Trading Day following
        the
        issuance of any Common Stock or Common Stock Equivalents subject to this
        Section
        3(b), indicating therein the applicable issuance price, or applicable reset
        price, exchange price, conversion price and other pricing terms (such notice
        the
“Dilutive
        Issuance Notice”).
        For
        purposes of clarification, whether or not the Company provides a Dilutive
        Issuance Notice pursuant to this Section 3(b), upon the occurrence of any
        Dilutive Issuance, after the date of such Dilutive Issuance the Holder is
        entitled to receive a number of Warrant Shares based upon the Base Share
        Price
        regardless of whether the Holder accurately refers to the Base Share Price
        in
        the Notice of Exercise.

       

      c)  Subsequent
        Rights Offerings.
        If the
        Company, at any time while the Warrant is outstanding, shall issue rights,
        options or warrants to all holders of Common Stock (and not to Holders)
        entitling them to subscribe for or purchase shares of Common Stock at a price
        per share less than the average closing price of the Common Stock for the
        ten
        Trading Days ending on the day immediately prior to the record date mentioned
        below, then the Exercise Price shall be multiplied by a fraction, of which
        the
        denominator shall be the number of shares of the Common Stock outstanding
        on the
        date of issuance of such rights or warrants plus the number of additional
        shares
        of Common Stock offered for subscription or purchase, and of which the numerator
        shall be the number of shares of the Common Stock outstanding on the date
        of
        issuance of such rights or warrants plus the number of shares which the
        aggregate offering price of the total number of shares so offered (assuming
        receipt by the Company in full of all consideration payable upon exercise
        of
        such rights, options or warrants) would purchase at such average closing
        price.
        Such adjustment shall be made whenever such rights or warrants are issued,
        and
        shall become effective immediately after the record date for the determination
        of stockholders entitled to receive such rights, options or warrants.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      d)  Pro
        Rata Distributions.
        If the
        Company, at any time while this Warrant is outstanding, shall distribute
        to all
        holders of Common Stock (and not to Holders of the Warrants) evidences of
        its
        indebtedness or assets (including cash and cash dividends) or rights or warrants
        to subscribe for or purchase any security other than the Common Stock (which
        shall be subject to Section 3(b)), then in each such case the Exercise Price
        shall be adjusted by multiplying the Exercise Price in effect immediately
        prior
        to the record date fixed for determination of stockholders entitled to receive
        such distribution by a fraction of which the denominator shall be the average
        closing price of the Common Stock for the ten Trading Days ending on the
        day
        immediately prior to the record date mentioned above, and of which the numerator
        shall be such average closing price on such record date less the then per
        share
        fair market value at such record date of the portion of such assets or evidence
        of indebtedness so distributed applicable to one outstanding share of the
        Common
        Stock as determined by the Board of Directors in good faith. In either case
        the
        adjustments shall be described in a statement provided to the Holder of the
        portion of assets or evidences of indebtedness so distributed or such
        subscription rights applicable to one share of Common Stock. Such adjustment
        shall be made whenever any such distribution is made and shall become effective
        immediately after the record date mentioned above.

       

      e)  Fundamental
        Transaction.
        If, at
        any time while this Warrant is outstanding, other than a Reverse Merger,
        (A) the
        Company effects any merger or consolidation of the Company with or into another
        Person, (B) the Company effects any sale of all or substantially all of its
        assets in one or a series of related transactions, (C) 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 (D) 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 (each “Fundamental
        Transaction”),
        then,
        upon any subsequent exercise of this Warrant, the Holder shall have the right
        to
        receive, for each Warrant Share that would have been issuable upon such exercise
        immediately prior to the occurrence of such Fundamental Transaction, the
        number
        of shares of Common Stock of the successor or acquiring corporation or of
        the
        Company, if it is the surviving corporation, and any additional consideration
        (the “Alternate
        Consideration”)
        receivable as a result of such merger, consolidation or disposition of assets
        by
        a holder of the number of shares of Common Stock for which this Warrant is
        exercisable immediately prior to such event. 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. To the extent necessary to effectuate
        the foregoing provisions, any successor to the Company or surviving entity
        in
        such Fundamental Transaction shall issue to the Holder a new warrant consistent
        with the foregoing provisions and evidencing the Holder’s right to exercise such
        warrant into Alternate Consideration. 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
        Section
        3(e) and insuring that this Warrant (or any such replacement security) will
        be
        similarly adjusted upon any subsequent transaction analogous to a Fundamental
        Transaction. Notwithstanding anything to the contrary, in the event of a
        Fundamental Transaction that is (1) an all cash transaction, (2) a “Rule 13e-3
        transaction” as defined in Rule 13e-3 under the Securities Exchange Act of 1934,
        as amended, or (3) a Fundamental Transaction involving a person or entity
        not
        traded on a national securities exchange, the Nasdaq Global Select Market,
        the
        Nasdaq Global Market, or the Nasdaq Capital Market, the Company or any successor
        entity shall pay at the Holder’s option, exercisable at any time concurrently
        with or within 30 days after the consummation of the Fundamental Transaction,
        an
        amount of cash equal to the value of this Warrant as determined in accordance
        with the Black Scholes Option Pricing Model obtained from the “OV” function on
        Bloomberg L.P. using (i) a price per share of Common Stock equal to the average
        closing price of the Common Stock for the ten Trading Days ending on the
        day
        immediately preceding the date of consummation of the applicable Fundamental
        Transaction, (ii) a risk-free interest rate corresponding to the U.S. Treasury
        rate for a period equal to the remaining term of this Warrant as of the date
        of
        consummation of the applicable Fundamental Transaction and (iii) an expected
        volatility equal to the 100 day volatility obtained from the “HVT” function on
        Bloomberg L.P. determined as of the Trading Day immediately following the
        public
        announcement of the applicable Fundamental Transaction.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      f)  Calculations.
        All
        calculations under this Section 3 shall be made to the nearest cent or the
        nearest 1/100th of a share, as the case may be. For purposes of this Section
        3,
        the number of shares of Common Stock deemed to be issued and outstanding
        as of a
        given date shall be the sum of the number of shares of Common Stock (excluding
        treasury shares, if any) issued and outstanding.

       

      g)  Voluntary
        Adjustment By Company.
        The
        Company may at any time during the term of this Warrant reduce the then current
        Exercise Price to any amount and for any period of time deemed appropriate
        by
        the Board of Directors of the Company.

       

      h)  Notice
        to Holder.
        

       

      i.  Adjustment
        to Exercise Price.
        Whenever the Exercise Price is adjusted pursuant to any provision of this
        Section 3, the Company shall promptly mail to the Holder a notice setting
        forth
        the Exercise Price after such adjustment and setting forth a brief statement
        of
        the facts requiring such adjustment. If the Company enters into a Variable
        Rate
        Transaction (as defined in the Purchase Agreement), despite the prohibition
        thereon in the Purchase Agreement, the Company shall be deemed to have issued
        Common Stock or Common Stock Equivalents at the lowest possible conversion
        or
        exercise price at which such securities may be converted or exercised.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      ii.  Notice
        to Allow Exercise by Holder.
        If (A)
        the Company shall declare a dividend (or any other distribution in whatever
        form) on the Common Stock; (B) the Company shall declare a special nonrecurring
        cash dividend on or a redemption of the Common Stock; (C) the Company shall
        authorize the granting to all holders of the Common Stock rights or warrants
        to
        subscribe for or purchase any shares of capital stock of any class or of
        any
        rights; (D) the approval of any stockholders of the Company shall be required
        in
        connection with any reclassification of the Common Stock, any consolidation
        or
        merger to which the Company is a party, any sale or transfer of all or
        substantially all of the assets of the Company, of any compulsory share exchange
        whereby the Common Stock is converted into other securities, cash or property;
        (E) the Company shall authorize the voluntary or involuntary dissolution,
        liquidation or winding up of the affairs of the Company; then, in each case,
        the
        Company shall cause to be mailed to the Holder at its last address as it
        shall
        appear upon the Warrant Register of the Company, at least 20 calendar days
        prior
        to the applicable record or effective date hereinafter specified, a notice
        stating (x) the date on which a record is to be taken for the purpose of
        such
        dividend, distribution, redemption, rights or warrants, or if a record is
        not to
        be taken, the date as of which the holders of the Common Stock of record
        to be
        entitled to such dividend, distributions, redemption, rights or warrants
        are to
        be determined or (y) the date on which such reclassification, consolidation,
        merger, sale, transfer or share exchange is expected to become effective
        or
        close, and the date as of which it is expected that holders of the Common
        Stock
        of record shall be entitled to exchange their shares of the Common Stock
        for
        securities, cash or other property deliverable upon such reclassification,
        consolidation, merger, sale, transfer or share exchange; provided that the
        failure to mail such notice or any defect therein or in the mailing thereof
        shall not affect the validity of the corporate action required to be specified
        in such notice. The Holder is entitled to exercise this Warrant during the
        period commencing on the date of such notice to the effective date of the
        event
        triggering such notice.

       

      Section
        4. Transfer
        of Warrant.

       

      a)  Transferability.
        Subject
        to compliance with any applicable securities laws and the conditions set
        forth
        in Section 4(d) hereof and to the provisions of Section 4.1 of the Purchase
        Agreement, this Warrant and all rights hereunder (including, without limitation,
        any registration rights) are transferable, in whole or in part, upon surrender
        of this Warrant at the principal office of the Company or its designated
        agent,
        together with a written assignment of this Warrant substantially in the form
        attached hereto duly executed by the Holder or its agent or attorney and
        funds
        sufficient to pay any transfer taxes payable upon the making of such transfer.
        Upon such surrender and, if required, such payment, the Company shall execute
        and deliver a new Warrant or Warrants in the name of the assignee or assignees
        and in the denomination or denominations specified in such instrument of
        assignment, and shall issue to the assignor a new Warrant evidencing the
        portion
        of this Warrant not so assigned, and this Warrant shall promptly be cancelled.
        A
        Warrant, if properly assigned, may be exercised by a new holder for the purchase
        of Warrant Shares without having a new Warrant issued. 

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      b)  New
        Warrants.
        This
        Warrant may be divided or combined with other Warrants upon presentation
        hereof
        at the aforesaid office of the Company, together with a written notice
        specifying the names and denominations in which new Warrants are to be issued,
        signed by the Holder or its agent or attorney. Subject to compliance with
        Section 4(a), as to any transfer which may be involved in such division or
        combination, the Company shall execute and deliver a new Warrant or Warrants
        in
        exchange for the Warrant or Warrants to be divided or combined in accordance
        with such notice. All Warrants issued on transfers or exchanges shall be
        dated
        the Initial Exercise Date and shall be identical with this Warrant except
        as to
        the number of Warrant Shares issuable pursuant thereto. 

       

      c)  Warrant
        Register.
        The
        Company shall register this Warrant, upon records to be maintained by the
        Company for that purpose (the “Warrant
        Register”),
        in
        the name of the record Holder hereof from time to time. The Company may deem
        and
        treat the registered Holder of this Warrant as the absolute owner hereof
        for the
        purpose of any exercise hereof or any distribution to the Holder, and for
        all
        other purposes, absent actual notice to the contrary.

       

      d)  Transfer
        Restrictions.
        If,
        at the
time
        of
        the surrender of this Warrant in connection with any transfer of this Warrant,
        the transfer of this Warrant shall not be registered pursuant to an effective
        registration
        statement under the Securities Act
        and
under
        applicable state securities or blue sky laws, the Company may require, as
        a
        condition of allowing such transfer, that the Holder or transferee of this
        Warrant, as the case may be, comply
        with the provisions of Section 5.7 of the Purchase Agreement.

       

      Section
        5. Miscellaneous.

       

      a)  No
        Rights as Shareholder Until Exercise.
        This
        Warrant does not entitle the Holder to any voting rights or other rights
        as a
        shareholder of the Company prior to the exercise hereof as set forth in Section
        2(e)(i). 

       

      b)  Loss,
        Theft, Destruction or Mutilation of Warrant.
        The
        Company covenants that upon receipt by the Company of evidence reasonably
        satisfactory to it of the loss, theft, destruction or mutilation of this
        Warrant
        or any stock certificate relating to the Warrant Shares, and in case of loss,
        theft or destruction, of indemnity or security reasonably satisfactory to
        it
        (which, in the case of the Warrant, shall not include the posting of any
        bond),
        and upon surrender and cancellation of such Warrant or stock certificate,
        if
        mutilated, the Company will make and deliver a new Warrant or stock certificate
        of like tenor and dated as of such cancellation, in lieu of such Warrant
        or
        stock certificate.

       

      c)  Saturdays,
        Sundays, Holidays, etc.
        If the
        last or appointed day for the taking of any action or the expiration of any
        right required or granted herein shall not be a Business Day, then such action
        may be taken or such right may be exercised on the next succeeding Business
        Day.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      d)  Authorized
        Shares.
        

       

      The
        Company covenants that during the period the Warrant is outstanding, it will
        reserve from its authorized and unissued Common Stock a sufficient number
        of
        shares to provide for the issuance of the Warrant Shares upon the exercise
        of
        any purchase rights under this Warrant. The Company further covenants that
        its
        issuance of this Warrant shall constitute full authority to its officers
        who are
        charged with the duty of executing stock certificates to execute and issue
        the
        necessary certificates for the Warrant Shares upon the exercise of the purchase
        rights under this Warrant. The Company will take all such reasonable action
        as
        may be necessary to assure that such Warrant Shares may be issued as provided
        herein without violation of any applicable law or regulation, or of any
        requirements of the Trading Market upon which the Common Stock may be listed.
        The Company covenants that all Warrant Shares which may be issued upon the
        exercise of the purchase rights represented by this Warrant will, upon exercise
        of the purchase rights represented by this Warrant, be duly authorized, validly
        issued, fully paid and nonassessable and free from all taxes, liens and charges
        created by the Company in respect of the issue thereof (other than taxes
        in
        respect of any transfer occurring contemporaneously with such issue).

       

      Except
        and to the extent as waived or consented to by the Holder, the Company shall
        not
        by any action, including, without limitation, amending its certificate of
        incorporation or through any reorganization, transfer of assets, consolidation,
        merger, dissolution, issue or sale of securities or any other voluntary action,
        avoid or seek to avoid the observance or performance of any of the terms
        of this
        Warrant, but will at all times in good faith assist in the carrying out of
        all
        such terms and in the taking of all such actions as may be necessary or
        appropriate to protect the rights of Holder as set forth in this Warrant
        against
        impairment. Without limiting the generality of the foregoing, the Company
        will
        (a) not increase the par value of any Warrant Shares above the amount payable
        therefor upon such exercise immediately prior to such increase in par value,
        (b)
        take all such action as may be necessary or appropriate in order that the
        Company may validly and legally issue fully paid and nonassessable Warrant
        Shares upon the exercise of this Warrant, and (c) use commercially reasonable
        efforts to obtain all such authorizations, exemptions or consents from any
        public regulatory body having jurisdiction thereof as may be necessary to
        enable
        the Company to perform its obligations under this Warrant.

       

      Before
        taking any action which would result in an adjustment in the number of Warrant
        Shares for which this Warrant is exercisable or in the Exercise Price, the
        Company shall obtain all such authorizations or exemptions thereof, or consents
        thereto, as may be necessary from any public regulatory body or bodies having
        jurisdiction thereof.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      e)  Jurisdiction.
        All
        questions concerning the construction, validity, enforcement and interpretation
        of this Warrant shall be determined in accordance with the provisions of
        the
        Purchase Agreement and the Exchange Agreement.

       

      f)  Restrictions.
        The
        Holder acknowledges that the Warrant Shares acquired upon the exercise of
        this
        Warrant, if not registered, will have restrictions upon resale imposed by
        state
        and federal securities laws.

       

      g)  Nonwaiver
        and Expenses.
        No
        course of dealing or any delay or failure to exercise any right hereunder
        on the
        part of Holder shall operate as a waiver of such right or otherwise prejudice
        Holder’s rights, powers or remedies, notwithstanding the fact that all rights
        hereunder terminate on the Termination Date. If the Company willfully and
        knowingly fails to comply with any provision of this Warrant, which results
        in
        any material damages to the Holder, the Company shall pay to Holder such
        amounts
        as shall be sufficient to cover any costs and expenses including, but not
        limited to, reasonable attorneys’ fees, including those of appellate
        proceedings, incurred by Holder in collecting any amounts due pursuant hereto
        or
        in otherwise enforcing any of its rights, powers or remedies
        hereunder.

       

      h)  Notices.
        Any
        notice, request or other document required or permitted to be given or delivered
        to the Holder by the Company shall be delivered in accordance with the notice
        provisions of the Exchange Agreement.

       

      i)  Limitation
        of Liability.
        No
        provision hereof, in the absence of any affirmative action by Holder to exercise
        this Warrant to purchase Warrant Shares, and no enumeration herein of the
        rights
        or privileges of Holder, shall give rise to any liability of Holder for the
        purchase price of any Common Stock or as a stockholder of the Company, whether
        such liability is asserted by the Company or by creditors of the
        Company.

       

      j)  Remedies.
        Holder,
        in addition to being entitled to exercise all rights granted by law, including
        recovery of damages, will be entitled to specific performance of its rights
        under this Warrant. The Company agrees that monetary damages would not be
        adequate compensation for any loss incurred by reason of a breach by it of
        the
        provisions of this Warrant and hereby agrees to waive and not to assert the
        defense in any action for specific performance that a remedy at law would
        be
        adequate.

       

      k)  Successors
        and Assigns.
        Subject
        to applicable securities laws, this Warrant and the rights and obligations
        evidenced hereby shall inure to the benefit of and be binding upon the
        successors of the Company and the successors and permitted assigns of Holder.
        The provisions of this Warrant are intended to be for the benefit of all
        Holders
        from time to time of this Warrant and shall be enforceable by the Holder
        or
        holder of Warrant Shares.

       

      l)  Amendment.
        This
        Warrant may be modified or amended or the provisions hereof waived with the
        written consent of the Company and the Holder.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      m)  Severability.
        Wherever possible, each provision of this Warrant shall be interpreted in
        such
        manner as to be effective and valid under applicable law, but if any provision
        of this Warrant shall be prohibited by or invalid under applicable law, such
        provision shall be ineffective to the extent of such prohibition or invalidity,
        without invalidating the remainder of such provisions or the remaining
        provisions of this Warrant.

       

      n)  Headings.
        The
        headings used in this Warrant are for the convenience of reference only and
        shall not, for any purpose, be deemed a part of this Warrant.

       

      

      ********************

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

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

       

       

      
        	 	 	 
	 	
                SJ
                  ELECTRONICS, INC.

              
	 
 	 
 	 
 
	Date: 	By:  	/s/ 
	 	
                

                Name:
                  

              
	 	Title: 

      

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      NOTICE
        OF EXERCISE

      

      TO: SJ
        ELECTRONICS, INC. 

      (1)  The
        undersigned hereby elects to purchase_____ Warrant Shares of the Company
        pursuant to the terms of the attached Warrant (only if exercised in full),
        and
        tenders herewith payment of the exercise price in full, together with all
        applicable transfer taxes, if any.

       

      (2)  Payment
        shall take the form of (check applicable box):

       

      [
        ] in
        lawful money of the United States; or

       

      [
        ] [if
        permitted] the cancellation of such number of Warrant Shares as is necessary,
        in
        accordance with the formula set forth in subsection 2(c), to exercise this
        Warrant with respect to the maximum number of Warrant Shares purchasable
        pursuant to the cashless exercise procedure set forth in subsection
        2(c).

       

      (3)  Please
        issue a certificate or certificates representing said Warrant Shares in the
        name
        of the undersigned or in such other name as is specified below:

       

       

      

       

      

      The
        Warrant Shares shall be delivered to the following DWAC Account Number or
        by
        physical delivery of a certificate to:

      

      _______________________________

       

      _______________________________

       

      _______________________________

      

      (4)
        Accredited
        Investor.
        The
        undersigned is an “accredited investor” as defined in Regulation D promulgated
        under the Securities Act of 1933, as amended.

      

      [SIGNATURE
        OF HOLDER]

       

      Name
        of
        Investing Entity:
        ________________________________________________________________________

      Signature
        of Authorized Signatory of Investing Entity:
        _________________________________________________

      Name
        of
        Authorized Signatory:
        ___________________________________________________________________

      Title
        of
        Authorized Signatory:
        ____________________________________________________________________

      Date:
        ________________________________________________________________________________________

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      ASSIGNMENT
        FORM

      

      (To
        assign the foregoing warrant, execute

      this
        form
        and supply required information. 

      Do
        not
        use this form to exercise the warrant.)

       

      

      FOR
        VALUE
        RECEIVED, [____] all of or [_______] shares of the foregoing Warrant and
        all
        rights evidenced thereby are hereby assigned to
        __________________________

       

      

      ______________________________________________
        whose address is

      

      _______________________________________________________________.

      

      

      

      _______________________________________________________________

      

      Dated:
        ______________, _______

      

      

      Holder’s
        Signature: _____________________________

      

      Holder’s
        Address: _____________________________

       

      _____________________________

      

      

      

      Signature
        Guaranteed: ___________________________________________

      

      

      NOTE:
        The
        signature to this Assignment Form must correspond with the name as it appears
        on
        the face of the Warrant, without alteration or enlargement or any change
        whatsoever, and must be guaranteed by a bank or trust company. Officers of
        corporations and those acting in a fiduciary or other representative capacity
        should file proper evidence of authority to assign the foregoing
        Warrant.

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