Document:

Exhibit 4.8

 

FIRST WARRANT

 

COMMON STOCK PURCHASE WARRANT

 

NEITHER THE WARRANT REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES
ISSUABLE UPON EXERCISE HEREOF HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED. NEITHER THE WARRANT NOR SUCH SHARES MAY BE OFFERED OR
SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT, OR
AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT.

 

MICROMEM
TECHNOLOGIES INC.

 

	
  No.        

  	
   

  	
              
  Units

  

 

THIS CERTIFIES that, for value received,                       
(the “Holder”) currently residing at                               ,
is entitled to subscribe for and purchase from MICROMEM TECHNOLOGIES INC., an
Ontario, Canada corporation (the
“Company”), upon the terms and conditions set forth herein, at any time after
the date hereof, and before 5:00 P.M. on the one year anniversary of the
date this Warrant was first issued, (the “Exercise Period”), Three Hundred and
Fifty Thousand  (350,000) Units, each
comprised of (i) one fully paid, validly issued and nonassessable share of
common stock, without par value, of the Company (“Common Stock”) and (ii) one
warrant to acquire one share of Common Stock at any time on or before 5:00 P.M.
on the two year anniversary of the date this Warrant was first issued (the “Second
Warrant”).  The exercise price of this
Warrant is U.S.$0.60 per Unit (the “Exercise Price”) and the exercise price of
the Second Warrant shall be U.S. $0.60 per share of Common Stock (the “Second
Warrant Exercise Price”). If the last day of the Exercise Period is a day on
which banking institutions in the State of Ontario are required or authorized
to close, then the Exercise Period shall end on the next succeeding day which
is not such a day. The number of Units and the component parts thereof issuable
upon exercise of the Warrant (the “Warrant Units”) and the Exercise Price may
be adjusted from time to time as hereinafter set forth.

 

As used herein the term “this Warrant” shall mean and include this
Warrant and any Warrant or Warrants hereafter issued as a consequence of the
exercise or transfer of this Warrant in whole or in part.  Upon each adjustment of the Exercise Price and
the Second Warrant Exercise Price as a result of the calculations made in Section 5,
(i) this Warrant shall thereafter evidence the right to receive, at the
adjusted Exercise Price, that number of Warrant Units (calculated to the
nearest one-hundredth) obtained by multiplying the aggregate number of Warrant
Units covered by this Warrant immediately prior to such adjustment by a
fraction, the numerator of which is the Exercise Price in effect immediately
prior to such adjustment of the Exercise Price and the denominator of which is
the Exercise Price in effect immediately after such adjustment of the Exercise
Price and (ii) the Second Warrant shall thereafter evidence the right to
receive, at the adjusted Second Warrant Exercise Price, that number of shares
of Common Stock (calculated to the nearest one-hundredth) obtained by
multiplying the aggregate number of shares of Common Stock covered by the
Second Warrant immediately prior to such adjustment by a fraction, the
numerator of which is the Second Warrant Exercise Price in effect immediately
prior to such

 

 

adjustment of the Second
Warrant Exercise Price and the denominator of which is the Second Warrant
Exercise Price in effect immediately after such adjustment of the Second
Warrant Exercise Price.

 

1.                                       This
Warrant may be exercised during the Exercise Period, as to the whole or any
lesser number of the respective whole Warrant Units, by surrender of this
Warrant to the principal offices of the Company, together with the Form of
Election attached hereto, duly executed, and accompanied by payment to the
Company of an amount equal to the Exercise Price multiplied by the number of
Warrant Units as to which this Warrant is then being exercised (the “Purchase
Price”).   Such payment may be made, at
the option of the Holder, by cash, money order, certified or bank cashier’s
check or wire transfer.

 

2.                                       Upon
the exercise of the Holder’s rights to purchase Warrant Units pursuant to Section 1
above, the Holder shall be deemed to be the holder of record of the Warrant Units
issuable upon such exercise, and the component parts thereof, notwithstanding
that the transfer books of the Company shall then be closed or certificates
representing the component parts of such Warrant Units shall not then have been
actually delivered to the Holder.  As
soon as practicable after the exercise of this Warrant pursuant to Section 1
above, a certificate or certificates for the component parts of the Warrant Units
(i.e. the shares of Common Stock and the Second Warrants) issuable upon such
exercise, registered in the name of the Holder or its designee and dated the
date of such exercise, shall be issued by the Company to the Holder.  If the Warrant should be exercised in part
only, the Company shall, upon surrender of this Warrant for cancellation,
execute and deliver a new Warrant evidencing the right of the Holder to
purchase the balance of the Warrant Units (or portions thereof) subject to
purchase hereunder.

 

3.                                       The
Holder may transfer or assign this Warrant, in whole or in part, from time to
time without the consent of the Company. 
Upon surrender of this Warrant to the Company at its principal office or
at the office of its stock transfer agent, if any, with the Form of Assignment
annexed hereto duly executed (with signature guaranteed, if required by the
Company or its stock transfer agent) and funds sufficient to pay any transfer
tax, the Company shall, without charge, execute and deliver a new Warrant in
the name of the assignee or assignees named in such instrument of assignment
and this Warrant shall promptly be canceled.

 

4.                                       The
Company shall at all times reserve and keep available out of its authorized and
unissued Common Stock, solely for the purpose of providing for the exercise of
the rights to purchase all shares of Common Stock issuable upon the exercise of
this Warrant and the exercise of the Second Warrant, such number of shares of
Common Stock as shall, from time to time, be sufficient therefor. The Company
covenants that all shares of Common Stock issuable upon exercise of this
Warrant and the Second Warrant, upon receipt by the Company of the full
Exercise Price or Second Warrant Exercise Price (as the case may be) shall at
the time of issuance be validly issued, fully paid, nonassessable, free of all
taxes, liens and charges created by the Company, and free of preemptive
rights.  If the Common Stock is or
becomes listed on any national securities exchange or the NASDAQ Stock Market,
the Company shall at its expense cause all shares of Common Stock issuable upon
exercise of this Warrant and the Second Warrant to be listed on such exchange
subject to notice of issuance or quoted on the NASDAQ Stock Market, as the case
may be.

 

5.                                       So
long as this Warrant shall be outstanding, (i) the number of Warrant Units
for which this Warrant shall be exercisable, and the number of shares of Common
Stock for which the Second Warrant shall be exercisable, shall each be subject
to the adjustment described in the second paragraph of this Warrant and (ii) the
Exercise Price and Second Warrant Exercise Price

 

2

 

in effect at any time, and the
number and kind of securities purchasable upon the exercise of the Warrant and
the Second Warrant, shall each be subject to adjustment from time to time upon
the happening of certain events as follows:

 

(a)  In case the Company shall (i) declare a dividend or make
a distribution on its outstanding shares of Common Stock in shares of Common
Stock, (ii) issue shares of Common Stock or securities convertible into
Common Stock for consideration less than the Exercise Price and the Second
Warrant Exercise Price on the date of issuance of such securities; (iii) subdivide
or reclassify its outstanding shares of Common Stock into a greater number of
shares (including any such reclassification in connection with a consolidation
or merger, whether or not the Company is the continuing corporation), or (iv) combine
or reclassify its outstanding shares of Common Stock into a smaller number of
shares, each of the Exercise Price and the Second Warrant Exercise Price in
effect at the time of the record date for such dividend or distribution, the
sale of such securities or the effective date of such subdivision, combination
or reclassification shall be proportionately adjusted as of the effective date
of such event by multiplying each of such Exercise Price and Second Warrant
Exercise Price by a fraction, the denominator of which shall be the number of
shares of Common Stock outstanding immediately following such event and the
numerator of which shall be the number of shares of Common Stock outstanding
immediately prior thereto. Such adjustment shall be made successively whenever
any event listed above shall occur.

 

(b)  No adjustment in the Exercise Price or Second Warrant
Exercise Price shall be required unless such adjustment would require an
increase or decrease of at least $.05 in such price; provided, however, that
any adjustments which by reason of this subsection (5)(b) are not
required to be made shall be carried forward and taken into account in any
subsequent adjustment required to be made hereunder.

 

(c)  Each computation required by this Section 5 for purposes
of determining whether the Exercise Price and Second Warrant Exercise Price shall
be adjusted shall be performed by the Company’s Chief Financial Officer on the
basis of the Company’s internally prepared unaudited financial statements. Such
unaudited financial statements shall be prepared and delivered to each Holder
promptly after the event requiring such adjustment, and shall be accompanied by
a certificate signed by the President and Chief Financial Officer certifying
that such unaudited statements have been prepared in accordance with U.S.
Generally Accepted Accounting Principles on a basis consistently applied and
included all adjustments (consisting only of normal, recurring accruals)
necessary for a fair presentation of the financial position and results of the
Company as of the end of each such period. Any dispute between the Holder and
the Company in regard to such a computation shall be referred to and decided by
a firm of independent certified public accountants mutually acceptable to the
Company and the Holder, which shall be a firm of recognized national reputation
(the “Accounting Firm”). Absent manifest error, the computations of the
Accounting Firm shall be final and binding on the Company and the Holder.

 

(d)  Whenever the Exercise Price or the Second Warrant Exercise
Price is adjusted, as herein provided, the Company shall promptly cause to be
mailed to the Holder, at its address appearing in the Warrant Register, a
notice setting forth the adjusted Exercise Price and the adjusted Second
Warrant Exercise Price, as well as the adjusted number of Warrant Units (and
the component parts thereof) issuable upon exercise of each Warrant and the
adjusted number of shares of Common Stock issuable upon exercise of each Second
Warrant, and shall cause a certified copy of sucn notice to be mailed to its
transfer agent, if any.

 

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(e)  All calculations under this Section (5) shall be
made to the nearest cent or to the nearest Warrant Unit or share of Common
Stock, as the case may be.

 

(f)  In the event that at any time, as a result of an adjustment
made pursuant to this Warrant or the Second Warrant, the Holder of this Warrant
or the Second Warrant thereafter shall become entitled to receive any shares of
the Company other than Common Stock, thereafter the number of such other shares
so receivable upon exercise of this Warrant or the Second Warrants shall be
subject to adjustment from time to time in a manner and on terms as nearly
equivalent as practicable to the provisions with respect to the Common Stock
contained in subsection (a) above.

 

(g)  Irrespective of any adjustments in the Exercise Price or
Second Warrant Exercise Price, or in the number or kind of Warrant Units or shares
of Common Stock purchasable upon exercise of this Warrant or the Second Warrant
(as the case may be), Warrants and Second Warrants theretofore or thereafter
issued may continue to express the same price and number and kind of securities
as are stated in the similar Warrants and/or Second Warrants initially issuable
pursuant to this Agreement.

 

6.                                       (a)                                  In
case of any consolidation with or merger of the Company with or into another
corporation (other than a merger in which the Company is the surviving corporation),
or in case of any sale, lease, or conveyance to another corporation of the
business, property or assets of any nature of the Company as an entirety or
substantially as an entirety, such successor, leasing, or purchasing
corporation, as the case may be, shall as a condition precedent to such
transaction (i) execute with the Holder an agreement providing that the
Holder shall have the right thereafter to receive upon exercise of this Warrant
at any time prior to the expiration of the Exercise Period, at the Exercise
Price in effect immediately prior to the consummation of such transaction, the
kind and amount of shares of stock and other securities, property, cash, or any
combination thereof receivable upon such consolidation, merger, sale, lease, or
conveyance by a holder of the number of shares of Common Stock for which this
Warrant might have been exercised immediately prior to such consolidation,
merger, sale, lease, or conveyance, (ii) execute with the Holder an
agreement providing that the Holder shall have the right thereafter to receive
upon exercise of the Second Warrant at any time prior to the expiration of the
exercise period applicable thereto, at the Second Warrant Exercise Price in
effect immediately prior to the consummation of such transaction, the kind and
amount of shares of stock and other securities, property, cash, or any
combination thereof receivable upon such consolidation, merger, sale, lease, or
conveyance by a holder of the number of shares of Common Stock for which the
Second Warrant might have been exercised immediately prior to such
consolidation, merger, sale, lease, or conveyance and (iii) make effective
provision in its certificate of incorporation or otherwise, if necessary, to
effect such agreements. Such agreements shall provide for adjustments which
shall be identical to the adjustments in Section 5. In the event that in
connection with any such consolidation, merger, sale, lease or conveyance,
additional shares of Common Stock and/or warrants to acquire such shares of
Common Stock shall be issued in exchange, conversion, substitution or payment,
in whole or in part, for a security of the Company other than Common Stock, any
such issue shall be treated as an issuance of additional securities covered by
the provisions of Section 5(a) hereof .

 

(b)                                 In
case of any reclassification, reorganization or other change of the shares of
Common Stock issuable upon exercise of this Warrant or the Second Warrant (other
than a change in par value or from no par value to a specified par value, or as
a result of a subdivision or combination, but including any change in the
shares into two or more classes or

 

4

 

series of shares), or in case
of any consolidation or merger of another corporation into the Company in which
the Company is the continuing corporation and in which there is a
reclassification, reorganization or other change (including the right to
receive cash, securities or other property of any other person) of the shares
of Common Stock (other than a change in par value, or from no par value to a
specified par value, or as a result of a subdivision or combination, but
including any change in the shares into two or more classes or series of
shares), the Holder shall have the right thereafter (i) to receive upon
exercise of this Warrant at any time prior to the expiration of the Exercise
Period the kind and amount of shares of stock and other securities, property,
cash, or any combination thereof receivable upon such reclassification,
reorganization, change, consolidation, or merger by a holder of the number of
shares of Common Stock for which this Warrant might have been exercised immediately
prior to such reclassification, reorganization, change, consolidation, or
merger and (ii) to receive upon exercise of the Second Warrant at any time
prior to the expiration of the exercise period applicable thereto the kind and
amount of shares of stock and other securities, property, cash, or any
combination thereof receivable upon such reclassification, reorganization,
change, consolidation, or merger by a holder of the number of shares of Common
Stock for which the Second Warrant might have been exercised immediately prior
to such reclassification, reorganization, change, consolidation, or merger.
Thereafter, appropriate provision shall be made for adjustments which shall be
identical to the adjustments in Section 5. In the event that in connection
with any such reclassification, reorganization, change of shares, consolidation
or merger additional shares of Common Stock and/or warrants to acquire such
shares of Common Stock shall be issued in exchange, conversion, substitution or
payment, in whole or in part, for a security of the Company other than Common
Stock, any such issue shall be treated as an issue of additional securities
covered by the provisions of Section 5(a) hereof.

 

(c)                                  The
above provisions of this Section 6 shall similarly apply to successive
reclassifications and changes of shares of Common Stock and to successive
consolidations, mergers, sales, leases, or conveyances.

 

7.                                       In
case at any time the Company shall propose:

 

(a)                                  to
pay any dividend or make any distribution on shares of Common Stock in shares
of Common Stock or make any other distribution (other than regularly scheduled
cash dividends which are not in a greater amount per share than the most recent
such cash dividend) to all holders of Common Stock; or

 

(b)                                 to
issue any rights, warrants, or other securities to all holders of Common Stock
entitling them to purchase any additional shares of Common Stock or any other
rights, warrants, or other securities; or

 

(c)                                  to
effect any reclassification, reorganization or other change of outstanding
shares of Common Stock, or any consolidation, merger, sale, lease, or
conveyance of property, described in Section 6; or

 

(d)                                 to
effect any liquidation, dissolution, or winding-up of the Company, or if any
involuntary proceeding is commenced for the liquidation, dissolution or winding-up
of the Company; or

 

(e)                                  to
take any other action which would cause an adjustment to the Exercise Price
and/or the Second Warrant Exercise Price;

 

5

 

then, and in any one or more of such cases, the Company shall give
written notice thereof, by registered mail, postage prepaid, to the Holder at
the Holder’s address as it shall appear on the books of the Company, mailed at
least twenty (20) days prior to (i) the date as of which the holders of
record of shares of Common Stock to be entitled to receive any such dividend,
distribution, rights, warrants, or other securities are to be determined, (ii) the
date on which any such reclassification, change of outstanding shares of Common
Stock, consolidation, merger, sale, lease, conveyance of property, liquidation,
dissolution, winding-up or otherwise is expected to become effective, and the
date as of which it is expected that holders of record of shares of Common
Stock shall be entitled to exchange their shares for securities or other
property, if any, deliverable upon such reclassification, change of outstanding
shares, consolidation, merger, sale, lease, conveyance of property,
liquidation, dissolution, winding-up or otherwise, or (iii) the date of
such action which would require an adjustment to the Exercise Price and/or the
Second Warrant Exercise Price.  Such
notice shall contain a description in reasonable detail of the proposed action
and stating the date or expected date referred to in clauses (i) through (iii) above,
as applicable.

 

8.                                       The
issuance of any Warrant Units or other securities upon the exercise of this
Warrant, and the delivery of certificates or other instruments representing
such shares or other securities, shall be made without charge to the Holder for
any tax or other charge in respect of such issuance. The Company shall not,
however, be required to pay any tax which may be payable in respect of any
transfer involved in the issue and delivery of any certificate in a name other
than that of the Holder and the Company shall not be required to issue or deliver
any such certificate unless and until the person or persons requesting the
issue thereof shall have paid to the Company the amount of such tax or shall
have established to the reasonable satisfaction of the Company that such tax
has been paid. This Warrant is exchangeable, without expense, at the option of
the Holder, upon presentation and surrender hereof to the Company, for other
Warrants of different denominations entitling the Holder hereof to purchase in
the aggregate the same number of Warrant Units purchasable hereunder.

 

9.                                       No
fractional shares or scrip representing fractional shares shall be issued upon
the exercise of the Warrant. With respect to any fraction of a share called for
upon any exercise hereof, the Company shall pay to the Holder an amount in cash
equal to such fraction multiplied by the Fair Market Value of a share of Common
Stock.   “Fair Market Value” means, as of
any date, (i) if shares of Common Stock are listed on a national
securities exchange, the average of the closing sale price per share therefor
on the securities exchange on which the greatest average volume of such shares
are traded over the last ten (10) trading days before such date, (ii) if
such shares of Common Stock are listed on The Nasdaq National Market, the Nasdaq
SmallCap Market or quoted on an interdealer quotation system but not on any
national securities exchange, the average of the closing sales price per share
therefor on The Nasdaq National Market, the Nasdaq SmallCap Market or
interdealer quotation system (as the case may be), for the last ten (10) trading
days before such date, (iii) if such shares of Common Stock are not listed
or quoted on either a national securities exchange, The Nasdaq National Market,
the Nasdaq SmallCap Market or other interdealer quotation system, the average
over the last twenty (20) trading days before such date of the average of the
closing bid and asked prices per share therefor on the pink-sheets or
non-interdealer quotation system, or (iv) if no such sales or bid and
asked prices are available, the fair market value per share of the Common Stock
as of such date, as determined in good faith by the Board of Directors of the
Company and shall not, in any event, be less than the greater of the price per
share of the Common Stock payable in connection with the then most recent
issuance of Common Stock and the average exercise price placed upon any
warrants and Options issued in the thirty days prior to the date of
determination of such Fair Market Value, or

 

6

 

if no such issuances have
occurred within such thirty day period, the average exercise price placed upon
the prior three issuances of warrants and/or options by the Company.

 

10.                                 The
Company represents and warrants to Holder that:

 

(a)                                  The
Company is a corporation duly organization, validly existing and in good
standing under the laws of Ontario, Canada; has all requisite corporate power
and authority to own or lease and operate its properties and to carry on its
business as now conducted; and is duly qualified or licensed to do business as
a foreign corporation in good standing in all jurisdictions in which it owns or
leases property or in which the conduct of its business requires it to so
qualify or be licensed.

 

(b)                                 The
Company has all requisite power and authority to enter into and perform all of
its obligations under this Warrant and the Second Warrant and to carry out the
transactions contemplated hereby and thereby. The Company has taken all
corporate or stockholder actions necessary to authorize it to enter into and
perform all of its obligations under this Warrant and the Second Warrant and to
consummate the transactions contemplated hereby and thereby. The execution and
delivery of this Warrant does not, and the consummation of the transactions
contemplated hereby and compliance with the provisions hereof will not,
conflict with, or result in any violation of, or default (with or without
notice or lapse of time, or both) under, or give rise to a right of
termination, cancellation or acceleration of any obligation or loss of a
benefit under, or result in the creation of any lien upon any of the properties
or assets of the Company under, (i) its articles or organization, by-laws
or other governing documents, (ii) any agreement, contract, lease,
license, mortgage, indenture, guarantee, or other instrument, undertaking or
commitment to which the Company is a party or by which it or its properties or
assets are bound or (iii) any judgment, order, injunction, decree,
statute, law, ordinance, rule or regulation applicable to the Company or
its properties or assets.

 

(c)                                  This
Warrant is the legal, valid and binding obligation of the Company, enforceable
in accordance with its terms, except as enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium and other similar laws
affecting the rights of creditors generally.

 

(d)                                 There
are no claims for brokerage commissions, finder’s fees or similar sales
compensation in connection with this Warrant based upon any arrangement or
agreement made by or on behalf of the Company, and the Company agrees to
indemnify and hold harmless any holder of this Warrant against any liability or
expense to it arising out of such a claim to the extent that such claim arises
out of actions or alleged actions of the Company.

 

(e)                                  The
Company agrees to indemnify and hold harmless the holder of this Warrant and
any affiliates, officers, directors, shareholders, members, partners and agents
of the holder of this Warrant against any and all loss, liability, claim,
damage, and expense whatsoever (including, but not limited to, any and all
expenses whatsoever, including the fees and disbursements of counsel,
reasonably incurred in investigating, preparing, or defending against any
litigation commenced or threatened or any claim whatsoever), arising out of or
based upon any breach or failure by the Company to comply with any
representation, warranty, covenant, or agreement made by the Company herein.

 

(f)                                    The
Company agrees that it shall not by any action including, without limitation,
amending its Articles of Organization or By-laws, or through any
reorganization,

 

7

 

transfer of assets,
amalgamation, consolidation, merger, dissolution, issue or sale of securities
or any other 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 the Holder hereof against
dilution (to the extent provided herein) or impairment.

 

11.                                 Registration Rights.  The
initial holder of this Warrant is entitled to the benefit of certain
registration rights with respect to the shares of Common Stock issuable upon
the exercise of this Warrant and the Second Warrant as provided in the
Registration Rights Agreement (as defined below), and any subsequent holder
hereof may be entitled to such rights.

 

12.                                 Certificates
evidencing the securities issuable upon exercise of the Warrants shall bear the
following legend, unless a registration statement under the Securities Act of
1933 is then effective with respect to such securities:

 

“THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR ANY
STATE SECURITIES LAWS BY REASON OF EXEMPTIONS FROM THE REGISTRATION
REQUIREMENTS OF THE ACT AND SUCH STATE SECURITIES LAWS, AND MAY NOT BE
SOLD, PLEDGED, ASSIGNED OR OTHERWISE DISPOSED OF IN ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE ACT AND APPLICABLE STATE SECURITIES LAWS OR
UNLESS AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE.”

 

The Holder shall be entitled to the rights and benefits set forth in a
certain Registration Rights Agreement of even date herewith by and among the
Company and the persons named therein (the “Registration Rights Agreement”).

 

13.                                 Upon
receipt of evidence reasonably satisfactory to the Company of the loss, theft,
destruction, or mutilation of any Warrant (and upon surrender of any Warrant if
mutilated), and upon reimbursement of the Company’s reasonable incidental
expenses, the Company shall execute and deliver to the Holder thereof a new
Warrant of like date, tenor, and denomination.

 

14.                                 The
Holder of any Warrant shall not have, solely on account of such status, any
rights of a stockholder of the Company, either at law or in equity, or to any
notice of meetings of stockholders or of any other proceedings of the Company, except
as provided in this Warrant.

 

15.                                 Any
notice or other communication required or permitted to be given hereunder shall
be in writing and shall be mailed by certified mail, return receipt requested
or sent by Federal Express, Express Mail, or similar overnight delivery or
courier service or delivered (in person or by telecopy, telex, or similar
telecommunications equipment) against receipt to the party to whom it is to be
given, if sent to the Company, at: 777
Bay Street, Suite 1910, Toronto, Ontario M5G 2E4, Canada,
Attention: Joseph Fuda; or if sent to the Holder, at the Holder’s address as it
shall appear on the Warrant Register; or to such other address as the party
shall have furnished in writing in accordance with the provisions of this Section 15.  Any notice or other communication given by
certified mail shall be deemed given at the time of certification thereof,
except for a notice changing a party’s address which will be deemed given at
the time of receipt thereof. Any notice given by other means permitted by this Section 15
shall be deemed given at the time of receipt thereof.

 

8

 

16.                                 This
Warrant shall be binding upon the Company and its successors and assigns and
shall inure to the benefit of the Holder and its successors and assigns.

 

17.                                 This
Warrant shall be construed in accordance with the laws of the State of New York
applicable to contracts made and performed within such State, without regard to
principles of conflicts of law.

 

18.                                 The
Company irrevocably consents to the jurisdiction of the courts of the State of
New York and of any federal court located in such State in connection with any
action or proceeding arising out of or relating to this Warrant, any document
or instrument delivered pursuant to, in connection with or simultaneously with
this Warrant, or a breach of this Warrant or any such document or instrument.
In any such action or proceeding, the Company waives personal service of any
summons, complaint or other process.

 

	
  Dated: December 23, 2004

  	
  MICROMEM
  TECHNOLOGIES INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

9

 

FORM OF ASSIGNMENT

 

(To be executed by the registered holder if such holder desires to
transfer the attached Warrant.)

 

FOR VALUE RECEIVED,                                                             
hereby sells, assigns, and transfers unto                                           
a Warrant to purchase Units, Units, each comprised of one fully paid, validly
issued and nonassessable shares of common stock, without par value, of the
Company (“Common Stock”) and one warrant to acquire one share of Common Stock
at any time on or before 5:00 P.M. on the two year anniversary of the date
this First Warrant was first issued (the “Second Warrant”), at an exercise
price of U.S.$0.60 per Unit, of Micromem Technologies, Inc. (the “Company”),
together with all right, title, and interest therein, and does hereby
irrevocably constitute and appoint                                       
attorney to transfer such Warrant on the books of the Company, with full power
of substitution.

 

	
  Dated:                                                 

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Signature

  	
   

  	
   

  

 

 

NOTICE

 

The signature on the foregoing Assignment must correspond to the name
as written upon the face of this Warrant in every particular, without
alteration or enlargement or any change whatsoever.

 

 

To:                              Micromem
Technologies, Inc.

777 Bay Street, Suite 1910

Toronto,
Ontario M5G 2E4

Canada

Fax: (416) 360-4034

 

ELECTION TO EXERCISE

 

The undersigned hereby exercises its rights to purchase                             
Warrant Units covered by the within warrant and tenders payment herewith in the
amount of $                          
in accordance with the terms thereof, and requests that certificates for such
securities be issued in the name of, and delivered to:

 

	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
  (Print Name, Address and Social Security

  or Tax Identification Number)

  

 

and, if such number of Warrant Units shall not be all the Warrant Units
covered by the within Warrant, that a new Warrant for the balance of the
Warrant Units covered by the within Warrant be registered in the name of, and
delivered to, the undersigned at the address stated below.

 

 

	
  Dated:

  	
   

  	
   

  	
  Name

  	
   

  	
   

  
	
   

  	
  (Print)

  
	
   

  
	
  Address:

  	
   

  	
   

  
	
   

  
	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (Signature)Exhibit 4.9

 

SECOND WARRANT

 

COMMON
STOCK PURCHASE WARRANT

 

NEITHER THE WARRANT REPRESENTED BY THIS
CERTIFICATE NOR THE SHARESRES ISSUABLE UPON EXERCISE HEREOF HAVE BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. NEITHER THE WARRANT
NOR SUCH SHARES MAY BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER SUCH ACT, OR AN EXEMPTION FROM REGISTRATION UNDER
SUCH ACT.

 

MICROMEM TECHNOLOGIES INC.

 

	
  No.       

  	
   

  	
                      Shares

  

 

THIS CERTIFIES that, for value received,                                   
(the “Holder”) currently residing at                                              ,
is entitled to subscribe for and purchase from MICROMEM TECHNOLOGIES INC., an
Ontario, Canada corporation (the
“Company”), upon the terms and conditions set forth herein, at any time after
the date hereof, and before 5:00 P.M. on                         
(insert the two year anniversary of the date the
First Warrant was first issued), (the “Exercise Period”),                               
 (                  )
Units, each comprised of one fully paid, validly issued and nonassessable
shares of common stock, without par value, of the Company (“Common Stock”), at
an exercise price of U.S.$0.60 per share (the “Exercise Price”).  If the last day of the Exercise Period is a
day on which banking institutions in the State of Ontario are required or
authorized to close, then the Exercise Period shall end on the next succeeding
day which is not such a day. The number of shares of Common Stock issuable upon
exercise of the Warrant (the “Warrant Shares”) and the Exercise Price may be
adjusted from time to time as hereinafter set forth.

 

As used herein the term “this Warrant” shall
mean and include this Warrant and any Warrant or Warrants hereafter issued as a
consequence of the exercise or transfer of this Warrant in whole or in
part.  Upon each adjustment of the
Exercise Price as a result of the calculations made in Section 5, this
Warrant shall thereafter evidence the right to receive, at the adjusted
Exercise Price, that number of shares of Common Stock (calculated to the
nearest one-hundredth) obtained by multiplying the aggregate number of shares
covered by this Warrant immediately prior to such adjustment by a fraction, the
numerator of which is the Exercise Price in effect immediately prior to such
adjustment of the Exercise Price and the denominator of which is the Exercise
Price in effect immediately after such adjustment of the Exercise Price.

 

1.                                       This
Warrant may be exercised during the Exercise Period, as to the whole or any
lesser number of the respective whole Warrant Shares, by surrender of this
Warrant to the principal offices of the Company, together with the Form of
Election attached hereto, duly executed, and accompanied by payment to the
Company of an amount equal to the Exercise Price multiplied by the number of
Warrant Shares as to which this Warrant is then being exercised (the “Purchase
Price”).  Such payment may be made, at
the option of the Holder, by cash, money order, certified or bank cashier’s
check or wire transfer;.

 

 

2.                                       Upon
the exercise of the Holder’s rights to purchase Warrant Shares pursuant to Section 1
above, the Holder shall be deemed to be the holder of record of the Warrant
Shares issuable upon such exercise, notwithstanding that the transfer books of
the Company shall then be closed or certificates representing such Warrant
Shares shall not then have been actually delivered to the Holder.  As soon as practicable after the exercise of
this Warrant pursuant to Section 1 above, a certificate or certificates
for the Warrant Shares issuable upon such exercise, registered in the name of
the Holder or its designee and dated the date of such exercise, shall be issued
by the Company to the Holder.  If the
Warrant should be exercised in part only, the Company shall, upon surrender of
this Warrant for cancellation, execute and deliver a new Warrant evidencing the
right of the Holder to purchase the balance of the Warrant Shares (or portions
thereof) subject to purchase hereunder.

 

3.                                       The
Holder may transfer or assign this Warrant, in whole or in part, from time to
time without the consent of the Company. 
Upon surrender of this Warrant to the Company at its principal office or
at the office of its stock transfer agent, if any, with the Form of Assignment
annexed hereto duly executed (with signature guaranteed, if required by the
Company or its stock transfer agent) and funds sufficient to pay any transfer
tax, the Company shall, without charge, execute and deliver a new Warrant in
the name of the assignee or assignees named in such instrument of assignment
and this Warrant shall promptly be canceled.

 

4.                                       The
Company shall at all times reserve and keep available out of its authorized and
unissued Common Stock, solely for the purpose of providing for the exercise of
the rights to purchase all Warrant Shares granted pursuant to this Warrant,
such number of shares of Common Stock as shall, from time to time, be
sufficient therefor. The Company covenants that all shares of Common Stock
issuable upon exercise of this Warrant, upon receipt by the Company of the full
Exercise Price shall at the time of issuance be validly issued, fully paid,
nonassessable, free of all taxes, liens and charges created by the Company, and
free of preemptive rights.  If the Common
Stock is or becomes listed on any national securities exchange or the NASDAQ
Stock Market, the Company shall at its expense cause all shares of Common Stock
issuable upon exercise of the Warrants to be listed on such exchange subject to
notice of issuance or quoted on the NASDAQ Stock Market, as the case may be.

 

5.                                       So
long as this Warrant shall be outstanding, the number of Warrant Sharess for
which this Warrant shall be exercisable shall be subject to the adjustment
described in the second paragraph of this Warrant and the Exercise Price in
effect at any time and the number and kind of securities purchasable upon the
exercise of the Warrants shall be subject to adjustment from time to time upon
the happening of certain events as follows:

 

(a)  In case the Company shall (i) declare
a dividend or make a distribution on its outstanding shares of Common Stock in
shares of Common Stock, (ii) issue shares of Common Stock or securities
convertible into Common Stock for consideration less than the Exercise Price of
the Warrant on the date of issuance of such securities; (iii) subdivide or
reclassify its outstanding shares of Common Stock into a greater number of
shares (including any such reclassification in connection with a consolidation or
merger, whether or not the Company is the continuing corporation), or (iv) combine
or reclassify its outstanding shares of Common Stock into a smaller number of
shares, the number of Warrant Units shall be Exercise Price in effect at the
time of the record date for such dividend or distribution, the sale of such
securities or the effective date of such subdivision, combination or
reclassification shall be proportionately adjusted as of the effective date of
such event by multiplying such Exercise Price by a fraction, the denominator of
which shall be the number of shares of Common Stock outstanding immediately
following such event and the numerator of which shall be the number of shares
of

 

2

 

Common Stock outstanding
immediately prior thereto. Such adjustment shall be made successively whenever
any event listed above shall occur.

 

(b)  No adjustment in the Exercise Price
shall be required unless such adjustment would require an increase or decrease
of at least $.05 in such price; provided, however, that any adjustments which
by reason of this subsection (5)(b) are not required to be made shall
be carried forward and taken into account in any subsequent adjustment required
to be made hereunder.

 

(c)  Each computation required by this Section 5
for purposes of determining whether the Exercise Price shall be adjusted shall
be performed by the Company’s Chief Financial Officer on the basis of the
Company’s internally prepared unaudited financial statements. Such unaudited
financial statements shall be prepared and delivered to each Holder promptly
after the event requiring such adjustment, and shall be accompanied by a
certificate signed by the President and Chief Financial Officer certifying that
such unaudited statements have been prepared in accordance with U.S. Generally
Accepted Accounting Principles on a basis consistently applied and included all
adjustments (consisting only of normal, recurring accruals) necessary for a
fair presentation of the financial position and results of the Company as of
the end of each such period. Any dispute between the Holder and the Company in
regard to such a computation shall be referred to and decided by a firm of
independent certified public accountants mutually acceptable to the Company and
the Holder, which shall be a firm of recognized national reputation (the “Accounting
Firm”). Absent manifest error, the computations of the Accounting Firm shall be
final and binding on the Company and the Holder.

 

(d)  Whenever the Exercise Price is
adjusted, as herein provided, the Company shall promptly cause to be mailed to
the Holder, at its address appearing in the Warrant Register, a notice setting
forth the adjusted Exercise Price and adjusted number of Warrant Units (and the
component parts thereof) issuable upon exercise of each Warrant, and shall
cause a certified copy thereof to be mailed to its transfer agent, if any.

 

(e)  All calculations under this Section (5) shall
be made to the nearest cent or to the nearest Warrant Unit, as the case may be.

 

(f)  In the event that at any time, as a
result of an adjustment made pursuant to this Warrant, the Holder of this
Warrant thereafter shall become entitled to receive any shares of the Company
other than Common Stock, thereafter the number of such other shares so
receivable upon exercise of this Warrant or the Second Warrants shall be
subject to adjustment from time to time in a manner and on terms as nearly
equivalent as practicable to the provisions with respect to the Common Stock
contained in subsection (a) above.

 

(g)  Irrespective of any adjustments in
the Exercise Price or the number or kind of Warrant Shares purchasable upon
exercise of this Warrant, Warrants theretofore or thereafter issued may
continue to express the same price and number and kind of shares as are stated
in the similar Warrants initially issuable pursuant to this Agreement.

 

6.                                       (a)                                  In
case of any consolidation with or merger of the Company with or into another
corporation (other than a merger in which the Company is the surviving
corporation), or in case of any sale, lease, or conveyance to another
corporation of the business, property or assets of any nature of the Company as
an entirety or substantially as an entirety, such successor, leasing, or
purchasing corporation, as the case may be, shall as a condition precedent to
such transaction (i) execute with the Holder an agreement providing that
the Holder shall have the

 

3

 

right thereafter to receive
upon exercise of this Warrant at any time prior to the expiration of the
Exercise Period, at the Exercise Price in effect immediately prior to the
consummation of such transaction, the kind and amount of shares of stock and
other securities, property, cash, or any combination thereof receivable upon
such consolidation, merger, sale, lease, or conveyance by a holder of the
number of shares of Common Stock for which this Warrant might have been
exercised immediately prior to such consolidation, merger, sale, lease, or conveyance
and (ii) make effective provision in its certificate of incorporation or
otherwise, if necessary, to effect such agreement. Such agreement shall provide
for adjustments which shall be identical to the adjustments in Section 5.
In the event that in connection with any such consolidation, merger, sale,
lease or conveyance, additional shares of Common Stock shall be issued in
exchange, conversion, substitution or payment, in whole or in part, for a
security of the Company other than Common Stock, any such issue shall be
treated as an issuance of additional shares covered by the provisions of Section 5
hereof.

 

(b)                                 In
case of any reclassification, reorganization or other change of the shares of
Common Stock issuable upon exercise of this Warrant (other than a change in par
value or from no par value to a specified par value, or as a result of a
subdivision or combination, but including any change in the shares into two or
more classes or series of shares), or in case of any consolidation or merger of
another corporation into the Company in which the Company is the continuing
corporation and in which there is a reclassification, reorganization or other
change (including the right to receive cash, securities or other property of
any other person) of the shares of Common Stock (other than a change in par
value, or from no par value to a specified par value, or as a result of a
subdivision or combination, but including any change in the shares into two or
more classes or series of shares), the Holder shall have the right thereafter
to receive upon exercise of this Warrant at any time prior to the expiration of
the Exercise Period the kind and amount of shares of stock and other
securities, property, cash, or any combination thereof receivable upon such
reclassification, reorganization, change, consolidation, or merger by a holder
of the number of shares of Common Stock for which this Warrant might have been
exercised immediately prior to such reclassification, reorganization, change,
consolidation, or merger. Thereafter, appropriate provision shall be made for
adjustments which shall be identical to the adjustments in Section 5. In
the event that in connection with any such reclassification, reorganization,
change of shares, consolidation or merger additional shares of Common Stock
shall be issued in exchange, conversion, substitution or payment, in whole or
in part, for a security of the Company other than Common Stock, any such issue
shall be treated as an issue of additional shares covered by the provisions of Section 5
hereof.

 

(c)                                  The
above provisions of this Section 6 shall similarly apply to successive
reclassifications and changes of shares of Common Stock and to successive
consolidations, mergers, sales, leases, or conveyances.

 

7.                                       In
case at any time the Company shall propose:

 

(a)                                  to
pay any dividend or make any distribution on shares of Common Stock in shares
of Common Stock or make any other distribution (other than regularly scheduled
cash dividends which are not in a greater amount per share than the most recent
such cash dividend) to all holders of Common Stock; or

 

(b)                                 to
issue any rights, warrants, or other securities to all holders of Common Stock
entitling them to purchase any additional shares of Common Stock or any other
rights, warrants, or other securities; or

 

4

 

(c)                                  to
effect any reclassification, reorganization or other change of outstanding
shares of Common Stock, or any consolidation, merger, sale, lease, or
conveyance of property, described in Section 6; or

 

(d)                                 to
effect any liquidation, dissolution, or winding-up of the Company, or if any
involuntary proceeding is commenced for the liquidation, dissolution or winding-up
of the Company; or

 

(e)                                  to
take any other action which would cause an adjustment to the Exercise Price;

 

then, and in any one or more of such cases, the Company shall give
written notice thereof, by registered mail, postage prepaid, to the Holder at
the Holder’s address as it shall appear on the books of the Company, mailed at
least twenty (20) days prior to (i) the date as of which the holders of
record of shares of Common Stock to be entitled to receive any such dividend,
distribution, rights, warrants, or other securities are to be determined, (ii) the
date on which any such reclassification, change of outstanding shares of Common
Stock, consolidation, merger, sale, lease, conveyance of property, liquidation,
dissolution, winding-up or otherwise is expected to become effective, and the
date as of which it is expected that holders of record of shares of Common
Stock shall be entitled to exchange their shares for securities or other
property, if any, deliverable upon such reclassification, change of outstanding
shares, consolidation, merger, sale, lease, conveyance of property,
liquidation, dissolution, winding-up or otherwise, or (iii) the date of
such action which would require an adjustment to the Exercise Price.  Such notice shall contain a description in
reasonable detail of the proposed action and stating the date or expected date
referred to in clauses (i) through (iii) above, as applicable.

 

8.                                       The
issuance of any Warrant Shares or other securities upon the exercise of this
Warrant, and the delivery of certificates or other instruments representing
such shares or other securities, shall be made without charge to the Holder for
any tax or other charge in respect of such issuance. The Company shall not,
however, be required to pay any tax which may be payable in respect of any
transfer involved in the issue and delivery of any certificate in a name other
than that of the Holder and the Company shall not be required to issue or
deliver any such certificate unless and until the person or persons requesting
the issue thereof shall have paid to the Company the amount of such tax or
shall have established to the reasonable satisfaction of the Company that such
tax has been paid. This Warrant is exchangeable, without expense, at the option
of the Holder, upon presentation and surrender hereof to the Company, for other
Warrants of different denominations entitling the Holder hereof to purchase in
the aggregate the same number of shares of Common Stock purchasable hereunder.

 

9.                                       No
fractional shares or scrip representing fractional shares shall be issued upon
the exercise of the Warrant. With respect to any fraction of a share called for
upon any exercise hereof, the Company shall pay to the Holder an amount in cash
equal to such fraction multiplied by the Fair Market Value of a share of Common
Stock. “Fair Market Value” means, as of any date, (i) if shares of Common
Stock are listed on a national securities exchange, the average of the closing
sale price per share therefor on the securities exchange on which the greatest
average volume of such shares are traded over the last ten (10) trading
days before such date, (ii) if such shares of Common Stock are listed on
The Nasdaq National Market, the Nasdaq SmallCap Market or quoted on an
interdealer quotation system but not on any national securities exchange, the
average of the closing sales price per share therefor on The Nasdaq National
Market, the Nasdaq SmallCap Market or interdealer quotation system (as the case
may be), for the last ten (10) trading days before such date, (iii) if
such shares of Common Stock are not listed or quoted

 

5

 

on either a national securities
exchange, The Nasdaq National Market, the Nasdaq SmallCap Market or other
interdealer quotation system, the average over the last twenty (20) trading
days before such date of the average of the closing bid and asked prices per
share therefor on the pink-sheets or non-interdealer quotation system ,or (iv) if
no such sales or bid and asked prices are available, the fair market value per
share of the Common Stock as of such date, as determined in good faith by the
Board of Directors of the Company and shall not, in any event, be less than the
greater of the price per share of the Common Stock payable in connection with
the then most recent issuance of Common Stock and the average exercise price
placed upon any warrants and Options issued in the thirty days prior to the
date of determination of such Fair Market Value, or if no such issuances have
occurred within such thirty day period, the average exercise price placed upon
the prior three issuances of warrants and/or options by the Company.

 

10.                                 The
Company represents and warrants to Holder that:

 

(a)                                  The
Company is a corporation duly organization, validly existing and in good
standing under the laws of Ontario, Canada; has all requisite corporate power
and authority to own or lease and operate its properties and to carry on its
business as now conducted; and is duly qualified or licensed to do business as
a foreign corporation in good standing in all jurisdictions in which it owns or
leases property or in which the conduct of its business requires it to so
qualify or be licensed.

 

(b)                                 The
Company has all requisite power and authority to enter into and perform all of
its obligations under this Warrant and to carry out the transactions
contemplated hereby. The Company has taken all corporate or stockholder actions
necessary to authorize it to enter into and perform all of its obligations
under this Warrant and to consummate the transactions contemplated hereby. The
execution and delivery of this Warrant does not, and the consummation of the
transactions contemplated hereby and compliance with the provisions hereof will
not, conflict with, or result in any violation of, or default (with or without
notice or lapse of time, or both) under, or give rise to a right of
termination, cancellation or acceleration of any obligation or loss of a
benefit under, or result in the creation of any lien upon any of the properties
or assets of the Company under, (i) its articles or organization, by-laws
or other governing documents, (ii) any agreement, contract, lease,
license, mortgage, indenture, guarantee, or other instrument, undertaking or
commitment to which the Company is a party or by which it or its properties or
assets are bound or (iii) any judgment, order, injunction, decree,
statute, law, ordinance, rule or regulation applicable to the Company or
its properties or assets.

 

(c)                                  This
Warrant is the legal, valid and binding obligation of the Company, enforceable
in accordance with its terms, except as enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium and other similar laws
affecting the rights of creditors generally.

 

(d)                                 There
are no claims for brokerage commissions, finder’s fees or similar sales
compensation in connection with this Warrant based upon any arrangement or
agreement made by or on behalf of the Company, and the Company agrees to
indemnify and hold harmless any holder of this Warrant against any liability or
expense to it arising out of such a claim to the extent that such claim arises
out of actions or alleged actions of the Company.

 

(e)                                  The
Company agrees to indemnify and hold harmless the holder of this Warrant and
any affiliates, officers, directors, shareholders, members, partners and agents
of the holder of this Warrant against any and all loss, liability, claim,
damage, and expense whatsoever

 

6

 

(including, but not limited to,
any and all expenses whatsoever, including the fees and disbursements of
counsel, reasonably incurred in investigating, preparing, or defending against
any litigation commenced or threatened or any claim whatsoever), arising out of
or based upon any breach or failure by the Company to comply with any
representation, warranty, covenant, or agreement made by the Company herein.

 

(f)                                    The
Company agrees that it shall not by any action including, without limitation,
amending its Articles of Organization or By-laws, or through any
reorganization, transfer of assets, amalgamation, consolidation, merger,
dissolution, issue or sale of securities or any other 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 the Holder hereof against dilution (to the extent provided
herein) or impairment.

 

11.                                 Registration
Rights.  The initial holder of this Warrant is entitled to the benefit of
certain registration rights with respect to the shares of Common Stock issuable
upon the exercise of this Warrant as provided in the Registration Rights
Agreement (as defined below), and any subsequent holder hereof may be entitled
to such rights.

 

12.                                 Certificates
evidencing the Warrant Shares issued upon exercise of the Warrant shall bear
the following legend, unless a registration statement under the Securities Act
of 1933 is then effective with respect to the Warrant Shares:

 

“THIS STOCK HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR ANY STATE SECURITIES LAWS BY
REASON OF EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF THE ACT AND SUCH
STATE SECURITIES LAWS, AND MAY NOT BE SOLD, PLEDGED, ASSIGNED OR OTHERWISE
DISPOSED OF IN ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT AND
APPLICABLE STATE SECURITIES LAWS OR UNLESS AN EXEMPTION FROM SUCH REGISTRATION
IS AVAILABLE.”

 

The Holder shall be entitled to the rights and benefits set forth in a
certain Registration Rights Agreement of even date herewith by and among the
Company and the persons named therein (the “Registration Rights Agreement”)..

 

13.                                 Upon
receipt of evidence reasonably satisfactory to the Company of the loss, theft,
destruction, or mutilation of any Warrant (and upon surrender of any Warrant if
mutilated), and upon reimbursement of the Company’s reasonable incidental
expenses, the Company shall execute and deliver to the Holder thereof a new
Warrant of like date, tenor, and denomination.

 

14.                                 The
Holder of any Warrant shall not have, solely on account of such status, any
rights of a stockholder of the Company, either at law or in equity, or to any
notice of meetings of stockholders or of any other proceedings of the Company,
except as provided in this Warrant.

 

15.                                 Any
notice or other communication required or permitted to be given hereunder shall
be in writing and shall be mailed by certified mail, return receipt requested
or sent by Federal Express, Express Mail, or similar overnight delivery or
courier service or delivered (in person or by telecopy, telex, or similar
telecommunications equipment) against receipt to the party to whom it is to be
given, if sent to the Company, at: 777
Bay Street, Suite 1910,

 

7

 

Toronto,
Ontario M5G 2E4, Canada, Attention: Joseph Fuda; or if sent to
the Holder, at the Holder’s address as it shall appear on the Warrant Register;
or to such other address as the party shall have furnished in writing in accordance
with the provisions of this Section 15. 
Any notice or other communication given by certified mail shall be
deemed given at the time of certification thereof, except for a notice changing
a party’s address which will be deemed given at the time of receipt thereof.
Any notice given by other means permitted by this Section 15 shall be
deemed given at the time of receipt thereof.

 

16.                                 This
Warrant shall be binding upon the Company and its successors and assigns and
shall inure to the benefit of the Holder and its successors and assigns.

 

17.                                 This
Warrant shall be construed in accordance with the laws of the State of New York
applicable to contracts made and performed within such State, without regard to
principles of conflicts of law.

 

18.                                 The
Company irrevocably consents to the jurisdiction of the courts of the State of
New York and of any federal court located in such State in connection with any
action or proceeding arising out of or relating to this Warrant, any document
or instrument delivered pursuant to, in connection with or simultaneously with
this Warrant, or a breach of this Warrant or any such document or instrument.
In any such action or proceeding, the Company waives personal service of any
summons, complaint or other process.

 

	
  Dated:
                    ,
  2004

  	
  MICROMEM TECHNOLOGIES INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

8

 

FORM OF ASSIGNMENT

 

(To be executed by the registered holder if such holder desires to
transfer the attached Warrant.)

 

FOR VALUE RECEIVED,                                                             
hereby sells, assigns, and transfers unto                                           
a Warrant to purchase shares of Common Stock, without par value, of Micromem
Technologies, Inc. (the “Company”), together with all right, title, and
interest therein, and does hereby irrevocably constitute and appoint                                       
attorney to transfer such Warrant on the books of the Company, with full power
of substitution.

 

	
  Dated:

  	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Signature 

  	
   

  

 

 

NOTICE

 

The signature on the foregoing Assignment
must correspond to the name as written upon the face of this Warrant in every
particular, without alteration or enlargement or any change whatsoever.

 

 

To:                              Micromem
Technologies, Inc.

777 Bay
Street, Suite 1910

Toronto, Ontario M5G 2E4

Canada

Fax: (416) 360-4034

 

ELECTION TO EXERCISE

 

The undersigned hereby exercises its rights
to purchase                             
Warrant Shares covered by the within warrant and tenders payment herewith in
the amount of $                          
in accordance with the terms thereof, and requests that certificates for such
securities be issued in the name of, and delivered to:

 

 

	
   

  
	
   

  
	
   

  
	
   

  
	
   

  
	
  (Print Name,
  Address and Social Security

  or Tax Identification Number)

  

 

and, if such number of Warrant Shares shall not be all the Warrant
Shares covered by the within Warrant, that a new Warrant for the balance of the
Warrant Shares covered by the within Warrant be registered in the name of, and
delivered to, the undersigned at the address stated below.

 

	
  Dated:

  	
   

  	
   

  	
  Name

  	
   

  	
   

  
	
   

  	
   

  	
  (Print)

  
	
   

  
	
  Address:

  	
   

  	
   

  
	
   

  
	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (Signature)

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