Document:

Warrant Agreement, dated April 26, 2004

 Exhibit 10.5 
 WARRANT AGREEMENT 
  
 THIS
WARRANT AGREEMENT (the “Agreement”), dated as of April 26, 2004, is made and entered into by and between Syntroleum Corporation, a Delaware corporation (the “Company”), and Sovereign Oil & Gas Company II, LLC, a Texas limited
liability company (the “Warrantholder”). This Agreement is being executed in connection with the Joint Development Agreement dated as of March 1, 2004 by and between the Company and the Warrantholder (the “JD Agreement”).

  
 The Company agrees to issue, and the Warrantholder agrees to
accept, the warrants, as hereinafter described (the “Warrants”), to purchase up to 50,000 shares (the “Shares”), of the Company’s Common Stock, par value $.01 per share (the “Common Stock”), as provided in the JD
Agreement. 
  
 In consideration of the foregoing and for the
purpose of defining the terms and provisions of the Warrants and the respective rights and obligations thereunder, the Company and the Warrantholder, for value received, hereby agree as follows: 
  
 Section 1. Transferability and Form of Warrants. 
  
 1.1 Registration. The Warrants shall be numbered and shall be
registered on the books of the Company when issued. 
  
 1.2
Limitations on Transfer. The Warrants and the Shares shall not be sold, assigned, transferred or pledged except upon the conditions specified in this Agreement. The Warrantholder will cause any proposed purchaser, assignee, transferee or
pledgee of the Warrants or the Shares, except for transferees in dispositions of Shares that are pursuant to an effective registration statement under the Securities Act of 1933, as amended (the “Act”), or dispositions of Shares pursuant
to Rule 144 under the Act, to agree to take and hold such securities subject to the provisions and upon the conditions specified in this Agreement. The Warrants may be divided or combined, upon request to the Company by the Warrantholder, into a
certificate or certificates representing the right to purchase the same aggregate number of Shares. Unless the context indicates otherwise, the term “Warrantholder” shall include any transferee or transferees of the Shares that are
required to be bound by the terms hereof, and the term “Warrants” shall include any and all warrants outstanding pursuant to this Agreement, including those evidenced by a certificate or certificates issued upon division, exchange or
substitution pursuant to this Agreement. The Warrantholder by its receipt of a Warrant certificate, agrees to be bound by and comply with the terms of this Agreement. The Warrantholder represents and agrees that the Warrant (and Shares if the
Warrant is exercised) is purchased only for investment, for the Warrantholder’s own account, and without any present intention to sell, or with a view to distribution of, the Warrant or Shares. 
  
 1.3 Form of Warrants. The text of the Warrants and of the form of
election to purchase Shares shall be substantially as set forth in Exhibit A attached hereto. The number of Shares issuable upon exercise of the Warrants is subject to adjustment upon the occurrence of 
  

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 certain events, all as hereinafter provided. The Warrant shall be executed on behalf of the Company by its Chief
Executive Officer, President or by a Vice President, attested to by its Secretary or an Assistant Secretary. A Warrant bearing the signature of an individual who was at any time the proper officer of the Company shall bind the Company,
notwithstanding that such individual shall have ceased to hold such office prior to the delivery of such Warrant or did not hold such office on the date of this Agreement. 
  
 The Warrants shall be dated as of the date of signature thereof by the Company either upon initial issuance or upon
division, exchange or substitution. 
  
 1.4 Legend on
Warrants. Each Warrant certificate shall bear the following legend: 
  

	 	(a)	“THE WARRANTS EVIDENCED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES
LAWS. NO SALE OR DISPOSITION MAY BE EFFECTED WITHOUT (I) AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO, (II) AN OPINION OF COUNSEL FOR THE HOLDER, REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION IS NOT REQUIRED AND ANY
PROSPECTUS DELIVERY REQUIREMENTS ARE NOT APPLICABLE OR (III) RECEIPT OF NO-ACTION LETTERS FROM THE APPROPRIATE GOVERNMENTAL AUTHORITIES. COPIES OF THE WARRANT AGREEMENT AND THE JOINT DEVELOPMENT AGREEMENT COVERING THE ISSUANCE OF THESE WARRANTS AND
VARIOUS REQUIREMENTS, INCLUDING WITHOUT LIMITATION PROVISIONS RESTRICTING THEIR TRANSFER, MAY BE OBTAINED AT NO COST BY WRITTEN REQUEST MADE BY THE HOLDER OF RECORD OF THIS CERTIFICATE TO THE SECRETARY OF THE COMPANY AT THE PRINCIPAL EXECUTIVE
OFFICES OF THE COMPANY.”; and 

  

	 	(b)	any legend required by applicable state securities law. 

  
 Any certificate issued at any time in exchange or substitution for any certificate bearing such legends (except, in the case of the Shares, a new
certificate issued upon completion of a public distribution pursuant to a registration statement under the Act or upon completion of a sale under Rule 144 under the Act of the securities represented thereby) shall also bear the above legend or
similar legend unless, in the opinion of the Company’s counsel, the securities represented thereby need no longer be subject to such restrictions. The Warrantholder consents to the Company making a notation on its records and giving
instructions to any registrar or transfer agent of the Warrants and the Common Stock in order to implement the restrictions on transfer established in this Agreement. 
  

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 Section 2. Exchange of Warrant Certificate. Any Warrant certificate may be exchanged for another
certificate or certificates entitling the Warrantholder to purchase a like aggregate number of Shares as the certificate or certificates surrendered then entitled the Warrantholder to purchase. If the Warrantholder desires to exchange a Warrant
certificate, it shall make such request in writing delivered to the Company, and shall surrender, properly endorsed, the certificate evidencing the Warrant to be so exchanged. Thereupon, the Company shall execute and deliver to the person entitled
thereto a new Warrant certificate as so requested. 
  
 Section 3.
Term of Warrants; Exercise of Warrants. 
  
 (a) Subject to
the terms of this Agreement, the Warrantholder shall have the right, at any time and from time to time on a day that is not a Saturday, Sunday or public holiday in Tulsa, Oklahoma during the period commencing on April 26, 2004, and ending at 5:00
p.m., Tulsa, Oklahoma time, on April 26, 2009 the “Termination Date”), to exercise a Warrant and to purchase from the Company up to the number of fully paid and nonassessable Shares to which the Warrantholder may at the time be entitled to
purchase pursuant to this Agreement, upon surrender to the Company, at its principal office, of the certificate evidencing the Warrants to be exercised, together with the purchase form on the reverse thereof duly completed and signed, and upon
payment to the Company of the Warrant Price (as defined in and determined in accordance with the provisions of this Section 3 and Sections 7 and 8 hereof), for the number of Shares in respect of which such Warrants are then exercised, but in no
event for less than 100 Shares (unless less than an aggregate of 100 Shares are then purchasable under all outstanding Warrants held by the Warrantholder). 
  
 (b) Payment by the Warrantholder of the aggregate Warrant Price due from it shall be made in cash or by immediately available funds, check or any
combination thereof. 
  
 (c) Upon such surrender of the Warrants
and payment of such Warrant Price as aforesaid, the Company shall issue and cause to be delivered to or upon the written order of the Warrantholder and in the name of the Warrantholder a certificate or certificates for the number of full Shares so
purchased upon the exercise of its Warrant, together with cash, as provided in Section 9 hereof, in respect of any fractional Shares otherwise issuable upon such surrender. Such certificate or certificates shall be deemed to have been issued and the
Warrantholder shall be deemed to have become a holder of record of such securities as of the date of surrender of the Warrants and payment of the Warrant Price, as aforesaid, notwithstanding that the certificate or certificates representing such
securities shall not actually have been delivered or that the stock transfer books of the Company shall then be closed. The Warrants shall be exercisable, at the election of the Warrantholder, either in full or from time to time in part and, in the
event that a certificate evidencing the Warrants is exercised in respect of less than all of the Shares specified therein at any time prior to the Termination Date, a new certificate evidencing the remaining portion of the Warrants held by the
Warrantholder will be issued by the Company. 
  
 Section 4.
Payment of Taxes. The Company will pay all documentary stamp taxes, if any, attributable to the initial issuance of the Warrants or the Shares; provided, however, the Company shall not be required to pay any tax which may be payable in
respect of any secondary transfer of the Warrants or the Shares. 
  

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 Section 5. Mutilated or Missing Warrants. In case the certificate or certificates evidencing the
Warrants shall be mutilated, lost, stolen or destroyed, the Company shall, at the request of the Warrantholder, issue and deliver in exchange and substitution for and upon cancellation of the mutilated certificate or certificates, or in lieu of and
substitution for the certificate or certificates lost, stolen or destroyed, a new Warrant certificate or certificates of like tenor and representing an equivalent right or interest, but only upon receipt of evidence satisfactory to the Company of
such loss, theft or destruction of such Warrant and a bond of indemnity, if requested, also satisfactory in form and amount at the applicant’s cost. Applicants for such substitute Warrants certificate shall also comply with such other
reasonable regulations and pay such other reasonable charges as the Company may prescribe. 
  
 Section 6. Reservation of Shares. There has been reserved, and the Company shall at all times keep reserved so long as the Warrants remain outstanding, out of its authorized Common Stock, such number of shares
of Common Stock as shall be subject to purchase under the Warrants. On or before taking any action that would cause an adjustment pursuant to the terms of the Warrants resulting in an increase in the number of shares of Common Stock deliverable upon
such conversion or exercise above the number thereof previously authorized, reserved and available therefor, the Company shall take all such action so required for compliance with this Section. 
  
 Section 7. Warrant Price. The price per Share at which Shares shall be
purchasable upon the exercise of the Warrants (the “Warrant Price”) shall be $6.40, subject to adjustment pursuant to Section 8 hereof. 
  
 Section 8. Adjustment of Number of Shares. The number and kind of securities purchasable upon the exercise of the Warrants and the Warrant Price
shall be subject to adjustment from time to time upon the happening of certain events, as follows: 
  
 8.1 Adjustments. The number of Shares purchasable upon the exercise of the Warrants and the Warrant Price shall be subject to adjustment as
follows: (a) In case the Company after the date hereof shall (1) make or pay a dividend or make a distribution in shares of Common Stock on its Common Stock, (2) subdivide its outstanding shares of Common Stock into a greater number of shares or (3)
combine or reclassify its outstanding shares of Common Stock into a smaller number of shares, the number of Shares purchasable upon exercise of the Warrants immediately prior to such action shall be adjusted so that the Warrantholder upon exercise
of the Warrants shall be entitled to receive the number of shares of Common Stock which it would have owned or would have been entitled to receive immediately following such action had the Warrants been exercised immediately prior thereto. An
adjustment made pursuant to this subsection (a) shall become effective on the day immediately after the record date, except as provided in subsection (f) below, in the case of a dividend or distribution and shall become effective on the day
immediately after the effective date in the case of a subdivision or combination. Whenever the number of Shares purchasable upon the exercise of a Warrant is adjusted as provided in this paragraph (a), the Warrant Price shall be adjusted by
multiplying such Warrant Price immediately prior to such adjustment by a fraction, of which the numerator shall be the number of Shares purchasable upon the exercise of the Warrants immediately prior to such adjustment, and of which the denominator
shall be the number of Shares so purchasable immediately thereafter. 
  

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 (b) In case the Company after the date hereof shall distribute any rights, warrants or options to all
holders of its Common Stock entitling them, for a period expiring within 60 days after the record date for such distribution, to purchase shares of Common Stock or securities convertible into Common Stock at a price per share less than the Relevant
Current Market Price Per Share (as defined below), the Warrant Price shall be adjusted by multiplying the Warrant Price in effect immediately prior to such adjustment by a fraction, of which (i) the numerator shall be the sum of (A) the number of
shares of Common Stock outstanding on the record date for the distribution to which this subsection (b) is being applied and (B) the number of shares of Common Stock which the aggregate price of the total number of shares of Common Stock offered
pursuant to the distribution to which this subsection (b) is being applied would purchase at the Relevant Current Market Price Per Share and (ii) the denominator shall be the sum of (A) the number of shares of Common Stock outstanding on the record
date for the distribution to which this subsection (b) is being applied and (B) the number of additional shares of Common Stock offered pursuant to the distribution to which this subsection (b) is being applied. For purposes of this subsection (b),
the “Relevant Current Market Price Per Share” means the then current market price per share of the Common Stock (determined as provided in subsection (d) below) on the record date for the distribution to which this subsection (b) applies,
minus, for any distribution to which subsection (c) applies and for which (x) the record date shall occur on or before the record date for the distribution to which this subsection (b) applies and (y) the “‘ex’ date” shall occur
on or after the record date for the determination of shareholders entitled to receive the rights, warrants or options to which this subsection (b) applies, the fair market value (on the record date for the distribution to which this subsection (b)
applies and as reasonably determined in good faith by the Board of Directors of the Company) of the assets of the Company or evidences of indebtedness, cash or securities distributed in respect of each share of Common Stock in such subsection (c)
distribution. The adjustment shall, except as provided in subsection (f) below, become effective on the day immediately after the record date for the determination of shareholders entitled to receive the rights, warrants or options to which this
subsection (b) applies. 
  
 (c) In case the Company or any
subsidiary of the Company after the date hereof shall distribute to all holders of Common Stock any of its assets, evidences of indebtedness, cash or securities (excluding any distributions referred to in subsections (a) or (b) and any dividend or
distribution paid in cash out of earned surplus of the Company) then in each such case the Warrant Price shall be adjusted so that the same shall equal the price determined by multiplying the Warrant Price in effect immediately prior to the record
date of such distribution by a fraction of which the numerator shall be the then current market price per share of the Common Stock (determined as provided in subsection (d) below) on the record date mentioned below less the then fair market value
(as reasonably determined in good faith by the Board of Directors of the Company) of the portion of the assets, evidences of indebtedness, cash or securities so distributed applicable to one share of Common Stock, and of which the denominator shall
be such current market price per share of the Common Stock. Such adjustment shall, except as provided in subsection (f) below, become effective on the day immediately after the record date for the determination of stockholders entitled to receive
such distribution. 
  
 (d) For the purpose of any computation
under subsection (b) or (c) above, the current market price per share of Common Stock on any date shall be deemed to be the average of the Market Value of the Common Stock for the 10 trading days before, and ending not later than, the earlier of the
date in question and the date before the “‘ex’ date”, with respect to the issuance or 
  

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 distribution requiring such computation. For purposes of subsection (b) and this subsection (d), the term
“‘ex’ date,” when used with respect to any issuance or distribution, means the first date on which the Common Stock trades regular way on the Nasdaq (or, if not listed or admitted to trading thereon, then on the principal
national securities exchange or automated quotation system on which the Common Stock is listed or admitted to trading and if not listed or admitted to trading on any national securities exchange or automated quotation system, as determined in good
faith by the Company’s Board of Directors) without the right to receive such issuance or distribution. 
  
 (e) In addition to the foregoing adjustments in subsections (a), (b) and (c) above, the Company will be permitted to make such reductions in the Warrant
Price as it considers to be advisable in order that any event treated for Federal income tax purposes as a dividend of stock or stock rights will not be taxable to the holders of the shares of Common Stock. 
  
 (f) In any case in which this Section 8 shall require that an adjustment be
made effective on the day immediately following a record date, the Company may elect to defer the effectiveness of such adjustment (but in no event until a date later than the effective time of the event giving rise to such adjustment), in which
case the Company shall, with respect to any Warrant exercised after such record date and on and before such adjustment shall have become effective (i) defer paying any cash payment pursuant to Section 9 hereof or issuing to the Warrantholder the
number of shares of Common Stock (or other assets or securities) issuable upon such exercise in excess of the number of shares of Common Stock and other capital stock of the Company issuable thereupon only on the basis of the Warrant Price prior to
such adjustment, and (ii) not later than five business days after such adjustment shall have become effective, pay to the Warrantholder the appropriate cash payment pursuant to Section 9 hereof and issue to the Warrantholder the additional shares of
Common Stock (or other asset or securities) issuable on such exercise. 
  
 (g) Upon the expiration of any rights, warrants or options referred to in subsection (b) or (c) above, to the extent the Warrants shall not have been exercised, the Warrant Price shall be adjusted to such amount as would have been received
by the Warrantholder had the adjustment in such Warrant Price made upon the distribution of such rights, warrants or options been made upon the basis of the distribution of only such number of rights, warrants or options as were actually exercised.

  
 (h) No adjustment in the number of Shares purchasable pursuant
to the Warrants or in the Warrant Price shall be required unless such adjustment would require an increase or decrease of at least 1.0% of the number of Shares then purchasable upon exercise of the Warrants or in the Warrant Price; provided,
however, that any adjustments which by reason of this subsection 8.1(h) are not required to be made immediately shall be carried forward and taken into account in any subsequent adjustment. All calculations under this Section 8 shall be made to the
nearest cent or to the nearest one-hundredth of a share, as the case may be. 
  
 (i) Whenever the number of Shares purchasable upon the exercise of the Warrants or the Warrant Price is adjusted as herein provided, the Company shall cause to be promptly mailed to the Warrantholder by first class
mail, postage prepaid, notice of such adjustment setting forth the number of Shares purchasable upon the exercise of the Warrants and the Warrant Price after such adjustment, a brief statement of the facts requiring such adjustment and the
computation by which such adjustment was made. 
  

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 (j) Except as provided in this Section 8 or in Section 11, during the term of the Warrants or upon the
exercise of the Warrants, no adjustment shall be made (i) in respect of any dividends or distributions or (ii) in respect of the consummation of any business combination or other extraordinary transaction. 
  
 (k) Irrespective of any adjustments in the number of securities issuable upon
exercise of Warrants or in the Warrant Price, Warrant certificates theretofore or thereafter issued may continue to express the same number of securities and Warrant Price as are stated in the Warrant certificates initially issuable pursuant to this
Agreement. However, the Company may, at any time in its sole discretion (which shall be conclusive), make any change in the form of Warrant certificate that it may deem appropriate and that does not affect the substance thereof; and any Warrant
certificate thereafter issued, whether upon registration of, or in exchange or substitution for, an outstanding Warrant certificate, may be in the form so changed. 
  
 8.2 Par Value of Shares of Common Stock. Before taking any action which would cause an adjustment effectively
reducing the portion of the Warrant Price allocable to each Share below the then par value per share of the Common Stock issuable upon exercise of the Warrants, the Company will take any corporate action which may, in the opinion of its counsel, be
necessary in order that the Company may validly and legally issue fully paid and nonassessable Common Stock upon exercise of the Warrants. 
  
 8.3 Independent Public Accountants. The Company may retain a firm of independent public accountants of recognized national standing (which may be
any such firm regularly employed by the Company) to make any computation required under this Section 8, and a certificate signed by such firm shall be conclusive evidence of the correctness of any computation made under this Section 8. 

 
 8.4 Statement on Warrant Certificates. Irrespective of any
adjustments in the number of securities issuable upon exercise of Warrants or in the Warrant Price, Warrant certificates theretofore or thereafter issued may continue to express the same number of securities and Warrant Price as are stated in the
Warrant certificates initially issuable pursuant to this Agreement. However, the Company may, at any time in its sole discretion (which shall be conclusive), make any change in the form of Warrant certificate that it may deem appropriate and that
does not affect the substance thereof; and any Warrant certificate thereafter issued, whether upon registration of, or in exchange or substitution for, an outstanding Warrant certificate, may be in the form so changed. 
  
 Section 9. Fractional Interests; Fair Value. The Company shall not be
required to issue fractional Shares on the exercise of the Warrants. If any fraction of a Share would, except for the provisions of this Section 9, be issuable on the exercise of the Warrants (or specified portion thereof), the Company shall pay an
amount in cash equal to the then Market Value of the Common Stock on the day of such exercise multiplied by such fraction. 
  
 Section 10. No Right as Stockholder; Notices to Warrantholder. Nothing contained in this Agreement or in the Warrants shall be construed as
conferring upon the Warrantholder or its transferees any rights as a stockholder of the Company, including the right to vote, receive dividends, call meetings, consent or receive notices as a stockholder in respect of any meeting of stockholders for
the election of directors of the Company or any other matter or 
  

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 imposing any fiduciary or other duty on the Company, its officers or directors, in favor of the Warrantholder, all of
which rights and duties owed to stockholders are disclaimed and waived by the Warrantholder. If, however, at any time prior to the expiration of the Warrants and prior to their exercise, any one or more of the following events shall occur:

  
 (a) any action which would require an adjustment pursuant to
Section 8.1; or 
  
 (b) a dissolution, liquidation or winding up
of the Company or a consolidation, merger or similar business combination or sale of its property, assets and business as an entirety or substantially as an entirety shall be proposed; 
  
 then the Company shall give notice in writing of such event to the Warrantholder, as provided in Section 13 hereof, promptly prior to the
date fixed as a record date or the date of closing the transfer books for the determination of the stockholders entitled to any relevant dividend, distribution, subscription rights or other rights, or for the determination of stockholders entitled
to vote on such proposed dissolution, liquidation or winding up. Such notice shall specify such record date or the date of closing the transfer books, as the case may be. Failure to mail or receive such notice or any defect therein shall not affect
the validity of any action taken with respect thereto. 
  
 Section
11. Continuation of Purchase Rights in Case of Reclassification, Change, Merger, Consolidation or Sale of Assets. If any of the following shall occur, namely: (a) any reclassification or change of outstanding shares of Common Stock issuable
upon exercise of the Warrants (other than a change in par value, or from par value to no par value, or from no par value to par value, or as a result of a subdivision or combination of outstanding shares of Common Stock), (b) any consolidation or
merger of the Company with or into any other person, or the merger of any other person with or into the Company (other than a merger which does not result in any reclassification, change, conversion, exchange or cancellation of outstanding shares of
Common Stock) or (c) sale, transfer or conveyance of all or substantially all of the assets of the Company (computed on a consolidated basis), then the Company, or such successor or purchasing entity, as the case may be, shall, as a condition
precedent to such reclassification, change, consolidation, merger, sale, transfer or conveyance, execute and deliver to the Warrantholder an agreement providing that the Warrantholder shall have the right to exercise the Warrants only into the kind
and amount of shares of stock and other securities and property (including cash) receivable upon such reclassification, change, consolidation, merger, sale, transfer or conveyance by a holder of the number of shares of Common Stock issuable upon
exercise of the Warrants and (ii) failed to exercise its rights of an election, if any, as to the kind or amount of securities, cash and upon such reclassification, change, consolidation, merger, sale, transfer or conveyance (provided that if the
kind or amount of securities, cash, and other property receivable upon such reclassification, change, consolidation, merger, sale, transfer or conveyance is not the same for each share of Common Stock of the Company held immediately prior to such
reclassification, change, consolidation, merger, sale, transfer or conveyance in respect of which such rights of election shall not have been exercised (“non-electing share”), then for the purpose of this Section 11 the kind and amount of
securities, cash and other property receivable upon such reclassification, change, consolidation, merger, sale, transfer or conveyance by each non-electing share shall be deemed to be the kind and amount so receivable per share by a plurality of the
non-electing shares). Such agreement shall provide for adjustments which shall be as nearly equivalent as may be practicable to the adjustments provided for in this Agreement. If, in the case of any such consolidation, merger, sale or conveyance,
the 
  

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 stock or other securities and property (including cash) receivable thereupon by a holder of shares of Common Stock
includes shares of stock or other securities and property (including cash) of a corporation other than the successor or purchasing corporation, as the case may be, in such consolidation, merger, sale or conveyance, then such agreement shall also be
executed by such other corporation and shall contain such additional provisions to protect the interests of the Warrantholder as the Board of Directors of the Company shall reasonably consider necessary by reason of the foregoing. The provisions of
this Section 11 shall similarly apply to successive consolidations, mergers, sales or conveyances. Notice of the execution of each such agreement shall be mailed to the Warrantholder by first class mail, postage prepaid. 
  
 Section 12. Securities Laws; Restrictions on Transfer of Shares;
Registration Rights. 
  
 (a) The Warrantholder agrees that
the Warrant and the related Shares (each of the Warrant and the Shares being referred to herein as a “Security” and together, “Securities”) are being acquired for investment and that the Warrantholder will not purchase, offer,
sell or otherwise dispose of any of the Securities except under circumstances which will not result in a violation of the Act. In order to exercise this Warrant, the Warrantholder must be able to confirm and shall confirm in writing, by executing a
certificate to be supplied by the Company, all of the representations and other covenants contained in this Agreement, including that the Securities so purchased are being acquired for investment and not with a view toward distribution or resale.
The Shares (unless registered under the Act) shall be stamped or imprinted with, in addition to any other appropriate or required legend, a legend in substantially the following form: 
  
 “THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE
SECURITIES LAWS. NO SALE OR DISPOSITION MAY BE EFFECTED WITHOUT (i) AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO, (ii) AN OPINION OF COUNSEL FOR THE HOLDER, REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION IS NOT REQUIRED AND
ANY PROSPECTUS DELIVERY REQUIREMENTS ARE NOT APPLICABLE OR (iii) RECEIPT OF NO-ACTION LETTERS FROM THE APPROPRIATE GOVERNMENTAL AUTHORITIES. COPIES OF THE AGREEMENT COVERING THE ISSUANCE OF THESE SECURITIES AND RESTRICTING THEIR TRANSFER MAY BE
OBTAINED AT NO COST BY WRITTEN REQUEST MADE BY THE HOLDER OF RECORD OF THIS CERTIFICATE TO THE SECRETARY OF THE COMPANY AT THE PRINCIPAL EXECUTIVE OFFICES OF THE COMPANY.” 
  

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 (b) In addition, the Warrantholder specifically represents to the Company both at the time of initial
purchase of the Warrant and at those future times as specified herein: 
  
 (1) The Warrantholder has experience in analyzing and investing in companies like the Company and is capable of evaluating the merits and risks of an investment in the Company and has the capacity to protect its own interests. The
Warrantholder is an “Accredited Investor” as that term is defined in Rule 501(a) promulgated under the Act. The Warrantholder is aware of the Company’s business affairs and financial condition, and has acquired information about the
Company sufficient to reach an informed and knowledgeable decision to acquire the Securities. The Warrantholder is acquiring the Securities for its own account for investment purposes only not as a nominee or agent and not with a view to, or for the
resale in connection with, any “distribution” thereof for purposes of the Act. The Warrantholder is acquiring the Securities for investment for its own account, not as a nominee or agent, and not with a view to, or for resale in connection
with, any distribution thereof. The Warrantholder acknowledges the Company’s obligation to file a registration statement with respect to the Shares as set forth in the Registration Rights Agreement dated as of the date hereof by and among the
Company and the Warrantholder (the “Registration Rights Agreement”), the effectiveness of which registration statement may be required for the resale of the Shares. The Warrantholder has not offered or sold any portion of the Securities to
be acquired by the Warrantholder and has no present intention of reselling or otherwise disposing of any portion of such Securities either currently or after the passage of a fixed or determinable period of time or upon the occurrence or
nonoccurrence of any predetermined event or circumstance, and in particular the Warrantholder has no current intention to resell the Shares under such registration statement nor would it have such intention if such registration statement were
effective as of the date of purchase. The Warrantholder understands that investment in the Securities is subject to a high degree of risk. The Warrantholder can bear the economic risk of its investment, including the full loss of its investment, and
by reason of its business or financial experience or the business or financial experience of its professional advisors has the capacity to evaluate the merits and risks of its investment and protect its own interest in connection with the purchase
of the Securities. If other than an individual, the Warrantholder also represents it has not been organized for the purpose of acquiring the Securities. 
  
 (2) The Warrantholder understands that the Securities have not been and except as provided in the Registration Rights Agreement with respect to the Shares
will not be registered under the Act or any applicable State securities law in reliance upon a specific exemption therefrom, which exemption depends upon, among other things, the bona fide nature of the Warrantholder’s investment intent and the
accuracy of the Warrantholder’s representations as expressed herein and the Warrantholder will furnish the Company with such additional information as is reasonably requested by the Company in connection with such exemption. 
  
 (3) The Warrantholder further understands that the Securities must be held
indefinitely unless subsequently registered under the Act and any applicable state securities laws, or unless exemptions from registration are otherwise available. Moreover, the Warrantholder understands that the Company is under no obligation to
and does not expect to register the Securities except as provided for in the Registration Rights Agreement with respect to the Shares. 
  
 (4) The Warrantholder is aware of the provisions of Rule 144, promulgated under the Act, which, in substance, permit limited public resale of
“restricted securities” acquired, directly or indirectly, from the issuer thereof (or from an Affiliate of such issuer), in a nonpublic offering subject to the satisfaction of certain conditions, if applicable, including, among other
things: The availability of certain public information about the Company, the resale occurring not 
  

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 less than one year after the party has purchased and paid for the Securities to be sold; the sale being made through a
broker in an unsolicited “broker’s transaction” or in transactions directly with a market maker (as said term is defined under the Securities Exchange Act of 1934, as amended) and the amount of securities being sold during any
three-month period not exceeding the specified limitations stated therein. 
  
 (5) The Warrantholder further understands that it may not transfer the Warrants and that at the time it wishes to sell the Securities, it is possible that there will be no public market upon which to make such a sale,
and that, even if such a public market then exists, the Company may not be satisfying the current public information requirements of Rule 144, and that, in such event, the Warrantholder may be precluded from selling the Securities under Rule 144
even if the one-year minimum holding period had been satisfied. 
  
 (6) The Warrantholder further understands that in the event all of the requirements of Rule 144 are not satisfied, registration under the Act or compliance with registration exemption will be required; and that, notwithstanding the fact
that Rule 144 is not exclusive, the Staff of the Securities and Exchange Commission has expressed its opinion that persons proposing to sell private placement securities other than in a registered offering and otherwise than pursuant to Rule 144
will have a substantial burden of proof in establishing that an exemption from registration is available for such offers or sales, and that such persons and their respective brokers who participate in such actions do so at their own risk.

  
 (7) To the Warrantholder’s knowledge, the Company has
made available copies of the Company’s reports filed under the Exchange Act since the beginning of the Company’s current fiscal year. The Warrantholder has had a reasonable opportunity to ask questions relating to and otherwise discuss the
Company’s business, management and financial affairs with the Company’s management, customers and other parties, and the Warrantholder has received satisfactory responses to the Warrantholder’s inquiries. The Warrantholder has relied
solely on its own independent investigation before deciding to enter into the purchase of the Warrants contemplated hereby. Unless the Warrantholder has otherwise notified the Company in writing, the Warrantholder is not, and has not been within the
ninety (90) days prior to the closing date of the purchase of the Securities, a broker or dealer of securities. Unless the Warrantholder has otherwise notified the Company in writing, the Warrantholder is not an employee, officer or director of the
Company nor prior to the consummation of the actions contemplated hereby, is the Warrantholder the beneficial owner of 5% or more of the Common Stock of the Company. 
  
 (c) With respect to any offer, sale or other disposition of any Securities that is not registered under the Act, the
Warrantholder agrees to give written notice to the Company prior thereto, describing briefly the manner thereof, together with a written opinion of the Warrantholder’s counsel, if reasonably requested by the Company, to the effect that such
offer, sale or other disposition may be effected without registration or qualification (under the Act as then in effect or any federal or state law then in effect) of such Securities and indicating whether or not under the Act, certificates for the
Securities in question to be sold or otherwise disposed of require any restrictive legend as to applicable restrictions on transferability in order to ensure compliance with such law. Such opinion must be satisfactory to the Company in its
reasonable judgment and shall state that it may be relied upon by counsel to the Company, and any stock exchange or transfer agent. Promptly upon receiving such written notice and satisfactory opinion, if so requested, the 
  

 11 

 Company shall notify the Warrantholder that the Warrantholder may sell or otherwise dispose of such Securities all in
accordance with the terms of the notice delivered to the Company. If a determination has been made pursuant to this subsection (c) that the opinion of counsel for the Warrantholder is not satisfactory to the Company, the Company shall so notify the
Warrantholder promptly after such determination has been made and shall specify in detail the legal analysis supporting any such conclusion. Each certificate representing the Securities thus transferred (except a transfer registered under the Act or
a transfer of Shares pursuant to Rule 144) shall bear a legend as to the applicable restrictions on transferability in order to ensure compliance with such laws, unless in the aforesaid opinion of counsel for the Warrantholder, such legend is not
required in order to ensure compliance with such laws. The Company may issue stop transfer instructions to its transfer agent in connection with such restrictions. 
  
 (d) Prior to any transfer of the Securities (except a transfer registered under the Act or a transfer of Shares pursuant to
Rule 144), the proposed transferee shall agree in writing with the Company to be bound by the terms of this Agreement (whether or not the Warrant has been exercised or otherwise outstanding) as if an original signatory hereto and the proposed
transferee must be able to and must make representations as set forth in this Section 12. 
  
 (e) As used in this Section 12, “Affiliate” shall mean, with respect to any person, any other person controlling, controlled by or under direct or indirect common control with such person (for the purposes
of this definition “control,” when used with respect to any specified person, shall mean the power to direct the management and policies of such person, directly or indirectly, whether through ownership of voting securities, by contract or
otherwise; and the terms “controlling” and “controlled” shall have meanings correlative to the foregoing). 
  
 Section 13. Notices. Any notice pursuant to this Agreement by the Company or by the Warrantholder or a holder of Shares shall be in writing and
shall be deemed to have been duly given if delivered or mailed by certified mail, return receipt requested: 
  
 (a) If to the Warrantholder or holders of Shares addressed to it at 3555 Timmons Lane, Suite 1150, Houston, Texas 77027, Attention: President. 

 
 (b) If to the Company addressed to it at 4322 South 49th West Avenue,
Tulsa, Oklahoma 74107, Attention: Chief Financial Officer. 
  
 Each party may from time to time change the address to which notices to it are to be delivered or mailed hereunder by notice in accordance herewith to the other party. 
  
 Section 14. Successors. All the covenants and provisions of this Agreement by or for the benefit of the Company, the
Warrantholder or the holders of Shares shall bind and inure to the benefit of their respective successors and assigns hereunder. 
  
 Section 15. Applicable Law. This Agreement shall be deemed to be a contract made under the laws of the State of Delaware and for all purposes
shall be construed in accordance with the laws of said State. 
  
 Section 16. Benefits of this Agreement. Nothing in this Agreement shall be construed to give to any person or corporation other than the Company, the Warrantholder and the 
  

 12 

 holders of Shares any legal or equitable right, remedy or claim under this Agreement. This Agreement shall be for the
sole and exclusive benefit of the Company, the Warrantholder and the holders of Shares. 
  
 Section 17. Counterparts. This Agreement may be executed in any number of counterparts each of which shall be deemed an original, but all of which shall constitute one and the same instrument. 
  
 Section 18. Amendment. Except as expressly provided herein, neither
this Agreement nor any term hereof may be amended, waived, discharged or terminated other than by a written instrument signed by the party against whom enforcement of any such amendment, waiver, discharge or termination is sought; provided, however,
that any provisions hereof may be amended, waived, discharged or terminated upon the written consent of the Company and the Warrantholder. 
  

 13 

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

			
	 SYNTROLEUM CORPORATION

		
	 By:
	 	 
	 Name:
	 	 John B. Holmes, Jr.

	 Title:
	 	 President and Chief Operating Officer

	
	 SOVEREIGN OIL & GAS COMPANY II, LLC

		
	 By:
	 	 
	 Name:
	 	 Joseph M. Bruso, Jr.

	 Title:
	 	 President

  

 14 

 Exhibit 10.5 
  
 Exhibit A 
  
 THE WARRANTS EVIDENCED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
ANY STATE SECURITIES LAWS. NO SALE OR DISPOSITION MAY BE EFFECTED WITHOUT (I) AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO, (II) AN OPINION OF COUNSEL FOR THE HOLDER, REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION IS NOT
REQUIRED AND ANY PROSPECTUS DELIVERY REQUIREMENTS ARE NOT APPLICABLE OR (III) RECEIPT OF NO-ACTION LETTERS FROM THE APPROPRIATE GOVERNMENTAL AUTHORITIES. COPIES OF THE WARRANT AGREEMENT AND THE JOINT DEVELOPMENT AGREEMENT COVERING THE ISSUANCE OF
THESE WARRANTS AND VARIOUS REQUIREMENTS, INCLUDING WITHOUT LIMITATION PROVISIONS RESTRICTING THEIR TRANSFER, MAY BE OBTAINED AT NO COST BY WRITTEN REQUEST MADE BY THE HOLDER OF RECORD OF THIS CERTIFICATE TO THE SECRETARY OF THE COMPANY AT THE
PRINCIPAL EXECUTIVE OFFICES OF THE COMPANY. 
  
 Warrant Certificate
No. 001 
  
 WARRANTS TO PURCHASE 
 50,000 SHARES OF COMMON STOCK 
  
 SYNTROLEUM CORPORATION 
  
 INCORPORATED UNDER THE LAWS 
 OF THE STATE OF DELAWARE 
  
 This certifies that, for value received, SOVEREIGN OIL & GAS COMPANY II,
LLC, the registered holder hereof (the “Warrantholder”), is entitled to purchase from SYNTROLEUM CORPORATION (the “Company”), at any time during the period commencing the date hereof and ending at 5:00 p.m., Tulsa, Oklahoma time,
on April 26, 2009 at a purchase price per share of $6.40, (the “Warrant Price”) the number of shares of Common Stock of the Company set forth above (the “Shares”). The number of shares of Common Stock of the Company purchasable
upon exercise of each Warrant evidenced hereby and the Warrant Price shall be subject to adjustment from time to time as set forth in the Warrant Agreement. 
  
 The Warrants evidenced hereby may be exercised in whole or in part by presentation of this Warrant certificate with the Purchase Form attached hereto duly
executed and simultaneous payment of the Warrant Price at the principal office of the Company. Payment of such price shall be made in cash or immediately available funds. 
  
 The Warrants evidenced hereby are issued under and in accordance with a Warrant 
  

 A-1 

 Agreement, dated as of April 26, 2004 (the “Warrant Agreement”), between the Company and the Warrantholder and
are subject to the terms and provisions contained in the Warrant Agreement, including certain restrictions on the exercise thereof, to all of which the Warrantholder by acceptance hereof consents. 
  
 Upon any partial exercise of the Warrants evidenced hereby, there shall be
signed and issued to the Warrantholder a new Warrant certificate in respect of the Shares as to which the Warrants evidenced hereby shall not have been exercised. These Warrants may be exchanged at the office of the Company by surrender of this
Warrant certificate properly endorsed for one or more new Warrants of the same aggregate number of Shares as here evidenced by the Warrant or Warrants exchanged. No fractional shares of Common Stock will be issued upon the exercise of rights to
purchase hereunder, but the Company shall pay the cash value of any fraction upon the exercise of one or more Warrants. These Warrants are transferable in the manner and subject to the restrictions set forth or referred to in the Warrant Agreement.

  
 This Warrant Certificate does not entitle the Warrantholder to
any of the rights of a stockholder of the Company. 
  

 A-2 

	
	 SYNTROLEUM CORPORATION

	
	 By:

	 Name:

	 Title:

  
 Dated: April 26, 2004

  

	
	ATTEST:
	
	  

	 Secretary

  

 A-3 

 SYNTROLEUM CORPORATION 
 PURCHASE FORM 
  
 SYNTROLEUM CORPORATION

 4322 South 49th West Avenue 
 Tulsa, Oklahoma 74107 

 
 The undersigned hereby irrevocably elects to exercise the right of
purchase represented by the within Warrant certificate for, and to purchase thereunder,              shares of Common Stock (the “Shares”) provided for therein, and
requests that certificates for the Shares be issued in the name of: 
  

					
	 	 	                                      
                              	 	 
			
	 	 	                                      
                              	 	 
			
	 	 	                                      
                              	 	 

  
 (Please Print or Type
Name, Address and Social Security Number or Taxpayer Identification Number) 
  
 and, if said number of Shares shall not be all the Shares purchasable thereunder, that a new Warrant certificate for the balance of the Shares purchasable under the within Warrant certificate be registered in the name of the undersigned
Warrantholder as below indicated and delivered to the address stated below. The undersigned has also submitted to the Company a certificate in which it has made the representations and covenants required in Section 12 of the Warrant Agreement.

  
 Dated: 
  
 Name of Warrantholder: 

			
	
	                                       
                                        
                         

	 (Please Print)

	 Address:
	 	                                       
                                        
     

		
	 	 	                                       
                                        
     

		
	Signature:	 	                                       
                                        
     

  
 Note: The above signature must
correspond with the name as written upon the face of this Warrant certificate in every particular, without alteration or enlargement or any change whatever. 
  

 A-4Registration Rights Agreement, dated April 26, 2004

 Exhibit 10.6 
  
 REGISTRATION RIGHTS AGREEMENT 
  
 THIS REGISTRATION RIGHTS AGREEMENT is entered into effective as of April 26, 2004 by and between Syntroleum Corporation, a Delaware corporation (the
“Company”), and Sovereign Oil & Gas Company II, LLC, a Texas limited liability company (“Sovereign”). 
  
 RECITALS 
  
 WHEREAS, the Company and Sovereign are parties to that certain Joint Development Agreement, dated as of March 1, 2004 (the “JD Agreement”),
providing for the issuance by the Company to Sovereign or certain individuals identified by Sovereign (each, an “Individual”, and collectively, the “Individuals”) of warrants (the “Warrants”) to purchase up to 2,000,000
shares (the “Warrant Shares”) of the Company’s common stock, par value $0.01 per share (the “Common Stock”); and 
  
 WHEREAS, the issuance of the Warrants to Sovereign and the Individuals is conditioned upon granting the rights set forth herein to Sovereign and the
respective Individuals; 
  
 NOW THEREFORE, in consideration of the
foregoing, the parties agree as follows: 
  
 ARTICLE 1

 DEFINITIONS 
  
 1.1 Certain Definitions. As used in this Agreement, the following terms shall have the following respective meanings: 
  
 “Affiliate” means, with respect to any Person, any other
Person controlling, controlled by or under direct or indirect common control with such Person (for the purposes of this definition “control,” when used with respect to any specified Person, shall mean the power to direct the management and
policies of such Person, directly or indirectly, whether through ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” shall have meanings correlative to the foregoing).

  
 “Exchange Act” means the Securities Exchange
Act of 1934, as amended. 
  
 “Holder” means
Sovereign or each of the Individuals. 
  
 “Indemnitee” shall have the meaning ascribed to such term in subsection 2.1(f). 
  
 “Indemnified Party” shall have the meaning ascribed to such term in subsection 2.1(f). 
  
 “Indemnifying Party” shall have the meaning ascribed to such
term in subsection 2.1(f). 
  
 “Person” means any
person, individual, corporation, partnership, trust or other nongovernmental entity or any governmental agency, court, authority or other body (whether foreign, federal, state, local or otherwise). 
  

 1 

 The terms “register,” “registered” and “registration”
refer to the registration effected by preparing and filing a registration statement in compliance with the Securities Act, and the declaration or ordering of the effectiveness of such registration statement. 
  
 “Registrable Securities” means (A) the Warrant Shares, and
(B) any shares of Common Stock issued as (or issuable upon the conversion of any warrant, right or other security which is issued as) a dividend or other distribution with respect to or in replacement of the Shares or the Warrant Shares; provided,
however, that securities shall only be treated as Registrable Securities if and only for so long as they are held by a Holder and (1) have not been disposed of pursuant to a registration statement declared effective by the SEC and (2) have not been
sold in a transaction exempt from the registration and prospectus delivery requirements of the Securities Act so that all transfer restrictions and restrictive legends with respect thereto are removed upon the consummation of such sale.
Notwithstanding the foregoing, securities shall cease to constitute Registrable Securities when such Holder may sell under Rule 144 under the Securities Act in a three-month period all Registrable Securities then held by such Holder. 
  
 “Registration Expenses” means all expenses incurred by the
Company in complying with subsection 2.1(a) or (b) hereof, including, without limitation, all registration, qualification and filing fees, printing expenses, escrow fees, fees and expenses of counsel for the Company, blue sky fees and expenses (for
a reasonable number of states) and the expense of any special audits incident to or required by any such registration (but excluding the fees of legal counsel for any Holder). 
  
 “Registration Statement” means a registration statement under the Securities Act filed by the Company with
the SEC. 
  
 “Registration Period” shall have the
meaning ascribed to such term in subsection 2.1(d). 
  
 “SEC” means the Securities and Exchange Commission of the United States or any other U.S. federal agency at the time administering the Securities Act. 
  
 “Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations of the
Commission thereunder, all as the same shall be in effect at the time. 
  
 “Selling Expenses” means all underwriting discounts and selling commissions and similar fees applicable to the sale of Registrable Securities and all fees and expenses of legal counsel for any Holder and all transfer taxes.

  
 ARTICLE 2 
 REGISTRATION RIGHTS 
  
 2.1 Registration Rights. 
  
 (a) Piggyback Registration. 
  
 (i) If the Company at any time proposes to register any of its Common Stock or any other of its securities (collectively with the Common
Stock, “Other Securities”) under the Securities Act, whether or not for sale for its own account, in a 
  

 2 

 manner which would permit registration of Registrable Securities for sale for cash to the public under
the Securities Act, it will at such time give prompt written notice to Sovereign of its intention to do so at least 10 business days prior to the anticipated filing date of the Registration Statement relating to such registration. Such notice shall
offer Sovereign the opportunity to include in such Registration Statement such number of Registrable Securities as Sovereign may request. Upon the written request of Sovereign made within 5 business days after the receipt of the Company’s
notice (which request shall specify the number of Registrable Securities intended to be disposed of and the intended method of disposition thereof), the Company shall effect, in the manner set forth in subsection 2.1(e), in connection with the
registration of the Other Securities, the registration under the Securities Act of all Registrable Securities which the Company has been so requested to register, to the extent required to permit the disposition (in accordance with such intended
methods thereof) of the Registrable Securities so requested to be registered; provided, that if at any time after giving written notice of its intention to register any securities and prior to the effective date of such registration, the Company
shall determine for any reason not to register or to delay registration of such securities, the Company may, at its election, give written notice of such determination to Sovereign and, thereupon, (A) in the case of a determination not to register,
the Company shall be relieved of its obligation to register any Registrable Securities in connection with such registration and (B) in the case of a determination to delay such registration, the Company shall be permitted to delay registration of
any Registrable Securities requested to be included in such registration for the same period as the delay in registering such other securities, but, in either such case, without prejudice to the rights of Sovereign under subsection 2.1(b) or (c);

  
 (ii) If the registration referred to in the
first sentence of this subsection 2.1(a) is to be a registration in connection with an underwritten offering on behalf of either the Company or holders of securities (other than Registrable Securities) of the Company (“Other Holders”), and
the managing underwriter for such offering advises the Company in writing that, in such firm’s opinion, such offering would be materially and adversely affected by the inclusion therein of Registrable Securities requested to be included therein
because such Registrable Securities are not of the same type, class or series as the securities to be offered and sold in such offering on behalf of the Company and/or the Other Holders, the Company may exclude all such Registrable Securities from
such offering; 
  
 (iii) If the registration
referred to in the first sentence of this subsection 2.1(a) is to be a registration in connection with an underwritten primary offering on behalf of the Company, and the managing underwriter for such offering advises the Company in writing that, in
such firm’s opinion, such offering would be materially and adversely affected by the inclusion therein of the Registrable Securities requested to be included therein because the number or principal amount of such Registrable Securities,
considered together with the number or principal amount of securities proposed to be offered by the Company, exceeds the aggregate number or principal amount of securities which, in such firm’s opinion, can be sold in such offering without
materially and adversely affecting the offering, the Company shall include in such registration: (1) first, all securities the Company proposes to sell for its own account (“Company Securities”) 
  

 3 

 and (2) second, the number or principal amount of Registrable Securities and securities, if any,
requested to be included therein by Other Holders in excess of the number or principal amount of Company Securities which, in the opinion of such underwriter, can be so sold without materially and adversely affecting such offering (allocated pro
rata among Sovereign and the Other Holders on the basis of the number of securities (including Registrable Securities) requested to be included therein by Sovereign and each such Other Holder); 
  
 (iv) If the registration referred to in the first sentence
of this subsection 2.1(a) is to be a registration in connection with an underwritten secondary offering on behalf of Other Holders made pursuant to demand registration rights granted by the Company to such Other Holders (the “Initiating
Holders”), and the managing underwriter for such offering advises the Company in writing that, in such firm’s opinion, such offering would be materially and adversely affected by the inclusion therein of the Registrable Securities
requested to be included therein because the number or principal amount of such Registrable Securities, considered together with the number or principal amount of securities proposed to be offered by the Initiating Holders, exceeds the aggregate
number or principal amount of securities which, in such firm’s opinion, can be sold in such offering without materially and adversely affecting the offering, the Company shall include in such registration; (1) first, to the extent the
registration rights granted to an Initiating Holder permit it to exclude other securities from its registration on substantially the same basis as that set forth in subsection 2.1(a)(iii) hereof, all securities any such Initiating Holder proposes to
sell for its own account, and (2) second, the number or principal amount of additional securities (including Registrable Securities) that such managing underwriter advises can be sold without materially and adversely affecting such offering,
allocated pro rata among any Other Holders to which clause (1) does not apply and Sovereign on the basis of the number of securities (including Registrable Securities) requested to be included therein by Sovereign and each such Other Holder;

  
 (v) The Company shall not be required to
effect any registration of Registrable Securities under this subsection 2.1(a) incidental to the registration of any of its securities in connection with stock option or other executive or employee benefit or compensation plans of the Company;

  
 (vi) No registration of Registrable
Securities effected under this subsection 2.1(a) shall relieve the Company of its obligation to effect any registration of Registrable Securities required of the Company pursuant to subsection 2.1(b) or (c) hereof; and 
  
 (vii) The provisions of this subsection 2.1(a) shall not
require the Company to include Registrable Securities in any registration statement of the Company that has been filed prior to the date of this Agreement. 
  
 (b) Form S-8 Registration Statement. If any of the Warrants are issued to the Individuals, no later than 60 days following the receipt of a written
demand requiring registration of the Registrable Securities from Sovereign to Company subsequent to issuance of any 
  

 4 

 Warrants, the Company will file a Registration Statement on Form S-8 (or other applicable Form) with the SEC with respect
to the Registrable Securities and will use its commercially reasonable best efforts to cause such Registration Statement to be declared effective by the SEC. 
  
 (c) Form S-3 Registration Statement. If any of the Warrants are issued to Sovereign, no later than 60 days following the receipt of written demand
requiring registration of the Registrable Securities from Sovereign to Company subsequent to issuance of any Warrants, the Company will file a Registration Statement on Form S-3 (or other applicable Form) with respect to such Registrable Securities
and will use its commercially reasonable best efforts to cause such Registration Statement to be declared effective by the SEC. 
  
 (d) Expenses of Registration. All Registration Expenses incurred in connection with any registration, qualification or compliance pursuant to
subsection 2.1(a), (b) or (c) shall be borne by the Company. All Selling Expenses relating to the sale of securities registered by or on behalf of Holders shall be borne by such Holders pro rata on the basis of the number of securities so registered
except to the extent such Selling Expense is specifically attributable to one Holder, in which case it shall be borne by such Holder. 
  
 (e) Registration Procedures. In the case of the registration, qualification or compliance effected by the Company pursuant to this Agreement, the
Company will, upon reasonable request, inform each Holder as to the status of such registration, qualification and compliance. At its expense, the Company will during such time as the Holder holds Registrable Securities: 
  
 (i) use its commercially reasonable best efforts to keep
such registration, and any qualification or compliance under state securities laws which the Company determines to obtain, effective until (A) in the case of a Registration Statement on Form S-8, the date all of the Warrants have been exercised or
cease to be exercisable in accordance with their terms and (B) in the case of a Registration Statement on Form S-3 (or other applicable Form), the later of the date all of the Warrants cease to be exercisable in accordance with their terms and the
first anniversary of the date all of the Warrants have been exercised; 
  
 (ii) furnish such number of prospectuses and other documents incident thereto as the Holders from time to time may reasonably request; 
  
 (iii) use its commercially reasonable best efforts to register or qualify such Registrable Securities under
such other securities or blue sky laws of such jurisdictions as any Holder reasonably requests and do any and all other acts and things which may be reasonably necessary or advisable to enable such Holder to consummate the disposition of the
Registrable Securities owned by such Holder in such jurisdictions; provided, that the Company will not be required to (A) qualify generally to do business in any jurisdiction where it would not otherwise be required to qualify but for this Section
2.1(d), or (B) subject itself to income taxation in any such jurisdiction; 
  
 (iv) notify each Holder of such Registrable Securities, at any time when a prospectus relating thereto is required to be delivered under the Securities Act, of 
  

 5 

 the happening of any event as a result of which the prospectus included in such Registration Statement
contains an untrue statement of a material fact or omits any fact necessary to make the statements therein not misleading, and, at the request of any such Holder, the Company will prepare a supplement or amendment to such prospectus so that, as
thereafter delivered to the purchasers of such Registrable Securities, such prospectus will not contain an untrue statement of a material fact or omit to state any fact necessary to make the statements therein not misleading; 
  
 (v) cause all such Registrable Securities to be listed or
quoted on each securities exchange or automated quotation system on which similar securities issued by the Company are then listed or quoted; 
  
 (vi) appoint a transfer agent and registrar for all such Registrable Securities not later than the effective date of such Registration
Statement; and 
  
 (vii) the Company will use its
commercially reasonable best efforts to effect the registration, qualifications or compliances (including, without limitation, the execution of any required undertaking to file post-effective amendments, appropriate qualifications under applicable
blue sky or other state securities laws and appropriate compliance with applicable securities laws, requirements or regulations) as may be so reasonably requested and as would permit or facilitate the sale and distribution of all Registrable
Securities; provided that the Company shall not be obligated to take any action to effect any such state registration, qualification or compliance pursuant to this Section 2 in any particular jurisdiction in which the Company would be required to
execute a general consent to service of process in effecting such registration, qualification or compliance unless the Company is already subject to service or is required to qualify in such jurisdiction, as the case may be, and except as may be
required by the Securities Act. 
  
 The period of time during which the Company is
required hereunder to keep the Registration Statement effective is referred to herein as “the Registration Period.” 
  
 (f) Delay of Registration. The Holders shall have no right to take any action to restrain, enjoin or otherwise delay any registration pursuant to
subsection 2.1(a), (b) or (c) hereof as a result of any controversy that may arise with respect to the interpretation or implementation of this Agreement. 
  
 (g) Indemnification. In the case of the sale of Registrable Securities pursuant to a Registration Statement on Form S-3: 
  
 (i) To the extent permitted by law, the Company will
indemnify Sovereign and each Person controlling Sovereign within the meaning of Section 15 of the Securities Act, with respect to which any registration, qualification or compliance has been effected pursuant to this Agreement, (each an
“Indemnitee”), against all claims, losses, damages and liabilities (or actions in respect thereof), including any of the foregoing incurred in settlement of any litigation, commenced or threatened, arising out of or based on any untrue
statement of a material fact contained in any registration 
  

 6 

 statement, prospectus, offering circular or other document, or any amendment or supplement thereof,
incident to any such registration, qualification or compliance, or based on any omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, and will reimburse each Indemnitee
for reasonable legal and any other expenses reasonably incurred in connection with investigating, preparing or defending any such claim, loss, damage, liability or action; provided that the Company will not be liable in the case of any untrue
statement or omission to the extent that such untrue statement or omission is made in reliance upon and in conformity with written information furnished to the Company by an instrument duly executed by or on behalf of such Indemnitee and stated to
be specifically for use in preparation of such registration statement, prospectus, offering circular or other document; and provided that the Company will not be liable in any such case where the expense, claim, loss, damage or liability arises out
of or is related to the failure of Sovereign to comply with the covenants and agreements contained in this Agreement respecting sales of Registrable Securities; and, provided, further, that the indemnity with respect to any preliminary prospectus
shall not apply to the extent that any such claim, loss, damage or liability results from the fact that a current copy of the prospectus was not sent or given to the Person asserting any such claims, losses, damages or liabilities at or prior to the
written confirmation of the sale of the Registrable Securities confirmed to such Person if such current copy of the prospectus would have cured the defect giving rise to such claim, loss, damage or liability. 
  
 (ii) To the extent permitted by law, if Registrable
Securities held by Sovereign are included in the securities as to which such registration, qualification or compliance is being effected, Sovereign will indemnify the Company, each of its directors, officers, employees, legal counsel and accountants
and each Person who controls the Company within the meaning of Section 15 of the Securities Act, against all claims, losses, damages and liabilities (or actions in respect thereof), including any of the foregoing incurred in settlement of any
litigation, commenced or threatened, arising out of or based on any untrue statement of a material fact contained in any registration statement, prospectus, offering circular or other document, or any amendment or supplement thereof, incident to any
such registration, qualification or compliance, or based on any omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, or any failure by Sovereign to comply with the
covenants or agreements contained in this Agreement respecting the Registrable Securities and will reimburse the Company, such directors, officers, employees, legal counsel and accountants and such controlling Person for reasonable legal and any
other expenses reasonably incurred in connection with investigating, preparing or defending any such claim, loss, damage, liability or action; provided that Sovereign will only be liable in the case of any untrue statement or omission to the extent
that such untrue statement or omission is made in reliance upon and in conformity with written information furnished to the Company by an instrument duly executed by or on behalf of Sovereign and stated to be specifically for use in preparation of
such registration statement, prospectus, offering circular or other document. Notwithstanding the foregoing, in no event shall Sovereign be liable for any such claims, losses, damages or liabilities in excess of the proceeds received by Sovereign in
the offering, except in the event of fraud by Sovereign. 
  

 7 

 (iii) Each party entitled to indemnification under this subsection 2.1(f) (the
“Indemnified Party”) shall give notice to the party required to provide indemnification (the “Indemnifying Party”) promptly after such Indemnified Party has actual knowledge of any claim as to which indemnity may be sought, and
shall permit the Indemnifying Party to assume the defense of any such claim or any litigation resulting therefrom, provided that counsel for the Indemnifying Party, who shall conduct the defense of such claim or litigation, shall be approved by the
Indemnified Party (whose approval shall not unreasonably be withheld), and the Indemnified Party may participate in such defense at such party’s expense, and provided further that the failure of any Indemnified Party to give notice as provided
herein shall not relieve the Indemnifying Party of its obligations under this Agreement, unless such failure is prejudicial to the Indemnifying Party in defending such claim or litigation. An Indemnifying Party shall not be liable for any settlement
of an action or claim effected without its written consent (which consent will not be unreasonably withheld). 
  
 (iv) If the indemnification provided for in this subsection 2.1(f) is held by a court of competent jurisdiction to be unavailable to an
Indemnified Party with respect to any loss, liability, claim, damage or expense referred to therein, then the Indemnifying Party, in lieu of indemnifying such Indemnified Party thereunder, shall contribute to the amount paid or payable by such
Indemnified Party as a result of such loss, liability, claim, damage or expense in such proportion as is appropriate to reflect the relative fault of the Indemnifying Party on the one hand and of the Indemnified Party on the other in connection with
the statements or omissions which resulted in such loss, liability, claim, damage or expense as well as any other relevant equitable considerations. The relative fault of the Indemnifying Party and of the Indemnified Party shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission to state a material fact relates to information supplied by the Indemnifying Party or by the Indemnified Party and the parties’
relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. 
  
 (h) Covenants of Holders. 
  
 (i) Sovereign agrees that, upon receipt of any notice from the Company of the happening of any event requiring the preparation of a
supplement or amendment to a prospectus relating to Registrable Securities so that, as thereafter delivered to Sovereign, such prospectus will not contain an untrue statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein not misleading, Sovereign will forthwith discontinue disposition of Registrable Securities pursuant to the registration statement contemplated by subsection 2.1(c) until its receipt of
copies of the supplemented or amended prospectus from the Company and, if so directed by the Company, Sovereign shall deliver to the Company all copies, other than permanent file copies then in Sovereign’s possession, of the prospectus covering
such Registrable Securities current at the time of receipt of such notice. 
  
 (ii) Each Holder severally agrees for a period of 90 days from the effective date of any registration (other than a registration effected solely to implement an 
  

 8 

 employee benefit plan) of securities of the Company for any underwritten offering in which securities of
the Company are sold not to sell, make any short sale of, loan, grant any option for the purchase of, or otherwise dispose of any Registrable Securities or any other stock of the Company held by such Holder, other than any shares of Registrable
Securities included in such registration, without the prior written consent of the Company or the underwriters managing such underwritten offering, as the case may be; provided that this obligation is subject to the condition that all executive
officers and directors of the Company shall enter into similar agreements. 
  
 (iii) Sovereign agrees to suspend, upon request of the Company, any disposition of Registrable Securities pursuant to the Registration Statement and prospectus contemplated by subsection 2.1(c) during any period, not
to exceed in the aggregate 90 days in any 12-month period, when the Company determines in good faith that offers and sales pursuant thereto should not be made by reason of the presence of material, undisclosed circumstances or developments with
respect to which the disclosure that would be required in such a prospectus is premature, would have an adverse effect on the Company or is otherwise inadvisable. Any such request by the Company shall be held confidential by Sovereign. 

 
 (iv) Sovereign agrees to notify the Company, at any time
when a prospectus relating to the registration statement contemplated by subsection 2.1(c) is required to be delivered by it under the Securities Act, of the occurrence of any event relating to Sovereign which requires the preparation of a
supplement or amendment to such prospectus so that, as thereafter delivered to the purchasers of Registrable Securities, such prospectus will not contain an untrue statement of a material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading relating to Sovereign, and Sovereign shall promptly make available to the Company the information to enable the Company to prepare any such supplement or amendment. Sovereign also
agrees that, upon delivery of any notice by it to the Company of the happening of any event of the kind described in the preceding sentence of this subsection, Sovereign will forthwith discontinue disposition of Registrable Securities pursuant to
such registration statement until its receipt of the copies of the supplemental or amended prospectus contemplated by this subsection, which the Company shall promptly make available to Sovereign and, if so directed by the Company, Sovereign shall
deliver to the Company all copies, other than permanent file copies then in Sovereign’s possession, of the prospectus covering such Registrable Securities current at the time of receipt of such notice. 
  
 (v) Each Holder shall promptly furnish to the Company such
information regarding such Holder and the distribution proposed by such Holder as the Company may request in writing or as shall be required in connection with any registration, qualification or compliance referred to in this Section 2.1. Such
Holder will promptly keep the Company informed as to all sales of Registrable Securities made under the Registration Statement and assist the Company in updating such information in the Registration Statement and any prospectus supplement relating
thereto. 
  

 9 

 (vi) Sovereign hereby covenants with the Company (1) not to make any sale of the Shares
pursuant to the registration statement contemplated by subsection 2.1(c) without effectively causing the prospectus delivery requirements under the Securities Act to be satisfied, and (2) if such Shares are to be sold by any method or in any
transaction other than on a national securities exchange, in the over-the-counter market, on the Nasdaq, in privately negotiated transactions, or in a combination of such methods, to notify the Company at least five business days prior to the date
on which Sovereign first offers to sell any such Shares. 
  
 (vii) Sovereign acknowledges and agrees that the Registrable Securities sold pursuant to the registration statement contemplated by subsection 2.1(c) are not transferable on the books of the Company unless the stock
certificate submitted to the transfer agent evidencing such Registrable Securities is accompanied by a certificate reasonably satisfactory to the Company to the effect that (A) the Registrable Securities have been sold in accordance with such
registration statement and (B) the requirement of delivering a current prospectus has been satisfied. 
  
 (viii) In the event that the Company determines that Form S-8 is not available for the issuance of the Registrable Securities, Sovereign
agrees that it will not effect any disposition of the Registrable Securities that would constitute a sale within the meaning of the Securities Act except as contemplated in the registration statement contemplated by subsection 2.1(c). Sovereign
agrees not to take any action with respect to any distribution deemed to be made pursuant to such registration statement that constitutes a violation of Regulation M under the Exchange Act or any other applicable rule, regulation or law. 

 
 (i) Rule 144 Reporting. With a view to making available to the
Holders the benefits of certain rules and regulations of the SEC which at any time permit the sale of the Registrable Securities to the public without registration, the Company agrees to use its reasonable best efforts to: 
  
 (i) make and keep public information available, as those
terms are understood and defined in Rule 144 under the Securities Act, at all times; and 
  
 (ii) file with the SEC in a timely manner all reports and other documents required of the Company under the Exchange Act. 
  
 ARTICLE 3 
 MISCELLANEOUS 
  
 3.1 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, without regard to any principles of conflicts of law thereof. 

 
 3.2 Severability. In the event that any provision of this
Agreement becomes or is declared by a court of competent jurisdiction to be illegal, invalid, unenforceable or void, this Agreement shall continue in full force and effect without said provision. In such event, the 
  

 10 

 parties shall negotiate, in good faith, a legal, valid and binding substitute provision which most nearly effects the
intent of the parties in entering into this Agreement. 
  
 3.3
Notices. All notices and other communications required or permitted hereunder shall be in writing (or in the form of a telex or telecopy (confirmed in writing) to be given only during the recipient’s normal business hours unless
arrangements have otherwise been made to receive such notice by telex or telecopy outside of normal business hours) and shall be mailed by registered or certified mail, postage prepaid, or otherwise delivered by hand, messenger, or telex or telecopy
(as provided above) addressed (a) if to a Holder, at such address as such Holder shall have furnished to the Company in writing or (b) if to the Company, one copy should be sent to its principal executive offices and addressed to the attention of
the President, or at such other address as the Company shall have furnished to the Holders. 
  
 Each such notice or other communication shall for all purposes of this Agreement be treated as effective or having been given when delivered if delivered personally, or, if sent by mail, at the earlier of its receipt
or 72 hours after the same has been deposited in a regularly maintained receptacle for the deposit of the United States mail, addressed and mailed as aforesaid, or, if by telex or telecopy pursuant to the above, when received. 
  
 3.4 Facsimile Signatures. Any signature page delivered by a fax
machine or telecopy machine shall be binding to the same extent as an original signature page, with regard to any agreement subject to the terms hereof or any amendment thereto. Any party who delivers such a signature page agrees to later deliver an
original counterpart to any party which requests it. 
  
 3.5
Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be enforceable against the parties actually executing such counterparts and all of which together shall constitute one instrument.

  
 3.6 Titles and Subtitles. The titles and
subtitles used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement. 
  
 3.7 Termination. Except as otherwise provided herein, this Agreement shall terminate on the tenth anniversary of the date hereof.

  
 3.8 Waivers and Amendments. With the written
consent of the Company and the Holders holding at least a majority of the Registrable Securities, any provision of this Agreement may be waived (either generally or in a particular instance, either retroactively or prospectively and either for a
specified period of time or indefinitely) or amended. Upon the effectuation of each such waiver or amendment, the Company shall promptly give written notice thereof to the Holders, if any, who have not previously received notice thereof or consented
thereto in writing. 
  
 3.9 Successors and Assigns.
Except as otherwise provided herein, the provisions hereof shall inure to the benefit of and be binding upon, the successors, assigns, heirs, executors and administrators of the parties hereto. 
  
 3.10 Entire Agreement; Amendment. This Agreement constitutes
the full and entire understanding and agreement between the parties with regard to the subject hereof. 
  

 11 

 3.11 Construction. Whenever the context so requires, the singular number includes the
plural and vice versa, and a reference to one gender includes the other gender or the neuter. 
  
 3.12 Interpretation. The parties hereto acknowledge and agree that: (i) the rule of construction to the effect that any ambiguities are resolved against the drafting party shall not be employed in the
interpretation of this Agreement, and (ii) the terms and provisions of this Agreement shall be construed fairly as to all parties hereto and not in favor of or against any party, regardless of which party was generally responsible for the
preparation of this Agreement. 
  

 12 

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

			
	SYNTROLEUM CORPORATION
		
	 By:
	 	  

	 	 	 Name:    John B. Holmes, Jr.

	 	 	 Title:      President and Chief Operating Officer

	
	SOVEREIGN OIL & GAS COMPANY II, LLC
		
	 By:
	 	  

	 	 	 Name:    Joseph M. Bruso, Jr.

	 	 	 Title:      President

  

 13

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