
 
                                                           EXHIBIT 1.2   

                   PLACEMENT AGENTS' WARRANT AGREEMENT


      PLACEMENT AGENTS' WARRANT AGREEMENT, dated as of this ____ day
of May 1998, by and between Energy Conversion Devices, Inc. (the "Company"),
Janney Montgomery Scott Inc. ("JMS") and Nolan Securities Corporation  ("Nolan"
and, together with JMS, collectively, the "Placement Agents").

                             W I T N E S S E T H:

    WHEREAS,  the Company  proposes to make a public  offering  ("Offering")  of
 shares of its common stock, $.01 par value ("Common Stock") and common stock
purchase warrants  ("Warrants"),  each Warrant exercisable to purchase one share
of Common Stock, in units ("Units"), each Unit consisting of one share of Common
Stock
                             and one Warrant; and

      WHEREAS, the Units have been registered under a registration  statement on
Form S-3 declared  effective by the  Securities  and  Exchange  Commission  (the
"SEC") on May ___, 1998 (the "Registration Statement"); and

      WHEREAS, in connection with the Offering,  the Company has agreed to issue
to the Placement Agents, at $.01 per warrant,  warrants to purchase an aggregate
of _____ units  identical  to the Units (such  warrants,  the  "Placement  Agent
Warrants",  and the units  purchasable  upon  exercise  of the  Placement  Agent
Warrants, the "Underlying Units");

      NOW, THEREFORE, the Placement Agents and Company hereby agree as follows:

      SECTION 1.  Definitions.  The following terms as used in this Agreement 
shall have the meanings set forth below:

                  (a) "Business  Day" means a day other than a Saturday,  Sunday
or other day on which  banks in the State of New York are  authorized  by law to
remain closed;

                  (b) "Exercise  Date" means the date on which the Company shall
have  received  both  (i)  a  Placement  Agent  Warrant  Certificate  evidencing
Placement Agent Warrants, with the exercise form thereon duly executed, and (ii)
payment in cash,  or by official  bank or  certified  check made  payable to the
Company,  of an amount in lawful money of the United  States of America equal to
the Exercise Price for the Underlying Units, plus transfer taxes, if any;

                  (c)  "Exercise   Price"  means  the  purchase   price  for  an
Underlying Unit payable upon exercise of a Placement Agent Warrant  Certificate,
which price shall be $__________ per Unit,  subject to adjustment as provided in
Section 4 hereof.

                  (d) "Placement Agent Warrant  Certificate" means a certificate
evidencing  Placement  Agent  Warrants  substantially  in the form of  Exhibit A
hereto;



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                  (e) "Holder"means a person or entity in whose name a Placement
Agent Warrant  Certificate is registered  upon the books to be maintained by the
Company for such purpose.

                  (f) "Notice Event" means (i) any  authorization by the Company
of the issuance to all holders of shares of Common  Stock of rights,  options or
warrants to  subscribe  for or purchase  shares of Common  Stock or of any other
subscription rights or warrants, or (ii) any authorization by the Company of the
distribution  to all  holders  of  shares of Common  Stock of  evidences  of its
indebtedness or assets (other than cash dividends or  distributions  payable out
of  consolidated  earnings or earned  surplus or dividends  payable in shares of
Common Stock), (iii) any consolidation or merger to which the Company is a party
and for which  approval of  stockholders  of the Company is required,  or of the
conveyance or transfer of the properties and assets of the Company substantially
as an entirety,  or of any  reclassification  or change of Common Stock issuable
upon exercise of a Placement Agent Warrant (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), or a tender offer or exchange offer for
shares  of  Common  Stock,  (iv)  any  voluntary  or  involuntary   dissolution,
liquidation or winding-up of the Company.  or (v) any proposal by the Company to
take any other action that would  require an  adjustment,  pursuant to Section 4
hereof,  of the Exercise Price or in the number of Underlying Units  deliverable
upon exercise of a Placement Agent Warrant Certificate;

                  (g) "Transfer Agent" means State Street Bank and Trust
Company, as transfer agent for the Common Stock;

                  (h) "Underlying Securities" means, collectively, the
Underlying Shares and Underlying Warrants constituting the Underlying Units;

                  (i)  "Underlying  Shares"  means the  shares of Common  Stock,
subject to adjustment from time to time as provided herein, constituting part of
the Underlying Units;

                  (j) "Underlying Warrants" means the Warrants, subject to
adjustment from time to time as provided herein, constituting part of the
Underlying Units;

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

                  (l) "Warrant Agent" means State Street Bank and Trust
Company, as warrant agent for the Warrants;

                  (m) "Warrant Agreement" means that Warrant Agreement, dated as
of the date hereof, by and between the Company and the Warrant Agent;





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      SECTION 2.  Exercise of Placement Agent Warrants.

                  (a) Time of Exercise.  Subject to the  provisions of Section 4
hereof,  the Placement  Agent Warrants may be exercised from time to time,  upon
the terms and subject to the conditions set forth herein,  on or after 9:00 am.,
New York City time, on the first  anniversary  hereof and at or before 5:00 pm.,
New York City time, on May __, 2003, at which time the Placement  Agent Warrants
shall  expire  (the  "Expiration  Date"),  or, if the  Expiration  Date is not a
Business Day, at or before 5:00 pm. on the next following Business Date.

                  (b) Manner of Exercise.

                  (i) The Placement Agent Warrants may be exercised by a Holder,
in whole or in part,  to  purchase  Underlying  Units in such  amounts as may be
elected,  upon  surrender of the Placement  Agent Warrant  Certificate  with the
subscription form thereon duly executed,  to the Company at its corporate office
at 1675 West Maple Road, Troy, Michigan 48084,  together with the Exercise Price
for the  number of  Underlying  Units to be  purchased,  in lawful  money of the
United  States,  or by certified  check or bank draft  payable in United  States
Dollars to the order of the Company and upon  compliance with and subject to the
conditions set forth herein.

                  (ii) Upon  receipt of a Placement  Agent  Warrant  Certificate
with the  subscription  form thereon duly executed and accompanied by payment of
the  Exercise  Price for the number of  Underlying  Units  subscribed  for,  the
Company,  subject  to Section  6(b),  shall  cause to be issued  and  delivered,
promptly to the  Holder,  certificates  for the  Underlying  Securities  in such
denominations as the Holder shall request.

                  (iii) In the event a Holder shall  subscribe for less than all
of the Underlying Units  purchasable,  the Company shall execute a new Placement
Agent Warrant  Certificate  exercisable for the balance of the Underlying  Units
purchasable  and shall deliver such new Placement  Agent Warrant  Certificate to
the exercising Holder.

                  (iv) A Placement Agent Warrant  Certificate shall be deemed to
have been exercised  immediately  prior to the close of business on the Exercise
Date, and the person  entitled to receive the Underlying  Units shall be treated
for all purposes as the holder of the Underlying  Securities  constituting  such
Underlying Units as of the close of business on the Exercise Date.

                  (v) The Company  covenants  and agrees that it will pay,  when
due and payable, any and all taxes that may be payable with respect to the issue
of the Placement Agent Warrants or the Underlying  Securities  deliverable  upon
exercise  thereof.  The Company shall not,  however,  be required to pay any tax
that may be payable in

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respect of any transfer or assignment of Placement Agent Warrants or
the Underlying Securities.

      SECTION 3.  Covenants

                  (a)  Reservation  of  Shares  of  Common  Stock.  The  Company
covenants  that it will at all  times  reserve  and keep  available,  free  from
preemptive rights, out of its authorized Common Stock, solely for the purpose of
issuance upon exercise of the Placement Agent Warrants and Underlying  Warrants,
such  number  of  shares of Common  Stock as shall  equal the  aggregate  of the
Underlying Shares and Underlying  Warrant Shares and that the shares so reserved
shall,  at the  time of  delivery,  be duly  and  validly  issued,  fully  paid,
nonassessable  and free from all taxes,  liens and charges  with  respect to the
issue  thereof.  The Company  further  covenants  that the  Underlying  Warrants
issuable upon exercise of the Placement  Agent  Warrants shall be validly issued
and the legal, valid and binding obligations of the Company.

                  (b) Registration.

                  (i) The Company  shall  advise each Holder or its  transferee,
whether the Holder holds a Placement  Agent Warrant  Placement Agent Warrant and
holds the Underlying Securities,  by written notice at least four weeks prior to
the filing of any post-effective  amendment to the Registration  Statement or of
any new registration statement or post-effective  amendment thereto covering any
securities  of the  Company for its own account or for the account of others and
will, for a period of four years  commencing one year from the effective date of
the Registration Statement,  upon the request of any such Holder, include in any
such post-effective amendment or registration statement, such information as may
be  required  to permit a public  offering  by such  Holder of all or any of the
Underlying   Securities  or   Underlying   Warrant   Shares  (the   "Registrable
Securities").  The Company shall supply prospectuses and such other documents as
the  Holders  may  request  in  order to  facilitate  the  public  sale or other
disposition of the Registrable Securities,  use its best efforts to register and
qualify  the  Registrable  Securities  for sale in such  states as such  Holders
designate  and do any and all other acts and things  which  maybe  necessary  or
desirable  to  enable  such  Holders  to  consummate  the  public  sale or other
disposition of the  Registrable  Securities,  and shall indemnify the Holders in
the manner  provided  in  subparagraph  (c) below.  The  Holders  shall  furnish
information and  indemnification  as set forth in subparagraph  (c) below except
that the maximum  amount which may be recovered from any Holder shall be limited
to the  amount  of  proceeds  received  by  the  Holder  from  the  sale  of the
Registrable Securities.

                  (ii) JMS may on one occasion subsequent to May ____, 1999 give
notice to the Company that it desires to register under

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the Act all or any of the Underlying  Securities in which event the Company will
promptly  and no  later  than 30 days  after  receipt  of  such  notice,  file a
post-effective  amendment to the  Registraiton  Statement or a new  registration
statement to the end that the Underlying  Securities  and/or  Underling  Warrant
Shares may be  publicly  sold as  promptly as  practicable  thereafter,  and the
Company  will use its best  efforts  to cause  such  registration  to become and
remain effective  (including the taking of such steps as are necessary to obtain
the removal of any stop  order);  provided,  that JMS shall  furnish the Company
with appropriate  information.  Within ten days after receiving such notice, the
Company  shall give  notice to the other  Holders  advising  that the Company is
proceeding  with such  post-effective  amendment or  registraiton  statement and
offering to include therein the Underlying  Securities and/or Underlying Warrant
Shares of such other  Holders,  provided  that the  Holders  shall  furnish  the
Company with such  appropriate  information  (relating to the intentions of such
Holders) in  connection  therewith as the Company  shall  reasonably  request in
writing.  All  costs  and  expenses  of  such  post-effective  amendment  or new
registration  statement  shall be borne by the Company,  except that the Holders
shall  bear the fees of their own  counsel  and any  underwriting  discounts  or
commissions  applicable to any of the securities  sold by them. The Company will
maintain such registration  statement or post-effective  amendment current for a
period of at least  six  months  (and for up to an  additional  three  months if
requested  bythe  Holders)  from the effective  date thereof.  The Company shall
supply  prospectuses,  and such other  documents  as the  Holders may request in
order to  facilitate  the public sale or other  disposition  of the  Registrable
Securities,  use its best efforts to register and quality any of the Registrable
Securities  for  sale in such  states  as such  Holders  designate  and  furnish
indemnification in the manner provided below.

                  (c) Indemnification.

                  (i) In the  event  the  Company  shall  file a  post-effective
amendment to the Registration  Statement or a new registraiton statement for the
public offering of the Underlying  Securities and/or Underlying  Warrant Shares,
the Company  shall  indemnify  and hold  harmless  such Holder whose  Underlying
Securities  and/or  Underlying  Warrant Shares are included therein (such Holder
being hereinafter  called the "Distributing  Holder"),  and each person, if any,
who controls (within the meaning of the Act) the Distributing  Holder,  and each
underwriter  (within the meaning of the Act) of such securities and each person,
if any,  who  controls  (within  the  meaning of the Act) any such  underwriter,
against any losses, claims,  damages or liabilities,  joint or several, to which
the Distributing Holder, any such controlling person or any such underwriter may
become  subject,  under the Act or  otherwise,  insofar as such losses,  claims,
damages or liabilities (or actions in

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respect  thereof) arise out of or are based upon any untrue statement or alleged
untrue  statement  of any  materials  fact  contained  in any such  registraiton
statement or any preliminary prospectus or final prospectus  constituting a part
thereof or any  amendment or  supplement  thereto,  or arise out of or are based
upon the omission to state therein a material fact required to be stated therein
or necessary to make the statements  therein not misleading;  and will reimburse
the Distributing Holder and each such controlling person and underwriter for any
legal or other expenses  reasonably  incurred by the Distributing Holder or such
controlling  person or underwriter in connection with investigating or defending
any such loss, claim, damage, liability or action;  provided,  however, that the
Company  will not be liable in any such case to the  extent  that any such loss,
claim, damage or liability arises out of or is based upon an untrue statement or
alleged  untrue   statement  or  omission  or  alleged  omission  made  in  said
registraiton statement,  said preliminary  prospectus,  said final prospectus or
said  amendment or supplement  in reliance  upon and in conformity  with written
information  furnished  by such  Distributing  Holder or any other  Distributing
Holder, for use in the preparation thereof.

                  (ii) The Distributing  Holder will indemnify and hold harmless
the Company,  each of its  directors,  each of its officers who have signed said
registration  statement  and such  officers  who have signed  said  registraiton
statement and such amendments and supplements thereto,  each person, if any, who
controls the Company (within the meaning of the Act) against any losses, claims,
damages or  liabilities  to which the Company or any such  director,  officer or
controlling  person may become subject,  under the Act or otherwise,  insofar as
such losses,  claims,  damages or liabilities arise out of or are based upon any
untrue or alleged  untrue  statement  of any  material  fact  contained  in said
registration statement,  said preliminary prospectus,  said final prospectus, or
said amendment or supplement,  or arise out of or are based upon the omission or
the alleged  omission  to state  therein a material  fact  required to be stated
therein or necessary to make the statements therein not misleading, in each case
to the  extent,  but only to the extent that such  untrue  statement  or alleged
untrue statement or omission or alleged  omission was made in said  registraiton
statement, said preliminary prospectus,  said final prospectus or said amendment
or  supplement  in reliance  upon and in  conformity  with  written  information
furnished by such Distributing  Holder for use in the preparation  thereof;  and
will reimburse the Company or any such director,  officer or controlling  person
for any legal or other expenses  reasonably  incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or action.

                  (iii)  Promptly  after receipt by an  indemnified  party under
this subparagraph (c) of notice of the commencement of any

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action, such indemnified party will, if a claim in respect thereof is to be made
against  any  indemnifying  party,  give the  indemnifying  party  notice of the
commencement  thereof; but the omission so to notify the indemnifying party will
not relieve it from any  liability  which it may have to any  indemnified  party
otherwise than under this subparagraph (c).

                  (iv)  In  case  any  such   action  is  brought   against  any
indemnified  party,  and it notifies an indemnifying  party of the  commencement
thereof,  the indemnifying party will be entitled to participate in, and, to the
extent that it may wish,  jointly with any other  indemnifying  party  similarly
notified to assume the defense thereof, with counsel reasonably  satisfactory to
such indemnified  party,  and after notice from the  indemnifying  party to such
indemnified  party  of its  election  so to  assume  the  defense  thereof,  the
indemnifying  party  will not be liable to such  indemnified  party  under  this
subparagraph (c) for any legal or other expenses  subsequently  incurred by such
indemnified  party in connection  with the defense thereof other than reasonable
costs of investigation.

                  (d)  SEC  Reports.  So long as the  Placement  Agent  Warrants
remain  outstanding,  the Company shall cause copies of all quarterly and annual
financial  reports  and of the  information,  documents,  and other  reports (or
copies  of such  portions  of any of the  foregoing  as the SEC may by rules and
regulations  prescribe)  which  the  Company  is  required  to file with the SEC
pursuant to Section 13 or 15(d) of the  Securities  Exchange  Act of 19334 ("SEC
Report")  to be mailed to each  Holder at his or her  address  appearing  in the
register  maintained  by the Company for such purpose,  in each case,  within 15
days of filing with the SEC.  If the Company is not subject to the  requirements
of the aforesaid Section 13 or 15(d), the Company shall nevertheless continue to
cause  SEC  Reports,  comparable  to those  which it would be  required  to file
pursuant  to the  aforesaid  Section  13 or  15(d)  if it  were  subject  to the
requirements  of either such  Section,  to be so filed with the SEC (but only if
the SEC permits such  filings) and mailed to each Holder,  in each case,  within
the same time  periods  as would have  applied  (including  under the  preceding
sentence)  had the Company been  subject to the  requirements  of the  aforesaid
Section 13 or 15(d).

      SECTION  4.   Adjustment  of  Exercise  Price  and  Number  of  Underlying
Securities. The number of Underlying Securities purchasable upon the exercise of
the  Placement  Agent  Warrants  and the  Exercise  Price  shall be  subject  to
adjustment from time to time as follows:

                  (a) Stock Splits, Combinations, etc. In case the Company shall
hereafter  (i) pay a dividend  or make a  distribution  on its  Common  Stock in
shares of its capital stock- (whether shares of Common Stock or of capital stock
of any other  class),  (ii)  subdivide its  outstanding  shares of Common Stock,
(iii) combine its  outstanding  shares of Common Stock into a smaller  number of
shares,  or (iv)  issue by  reclassification  of its shams of  Common  Stock any
shares of capital  stock of the Company,  the  Exercise  Price in effect and the
number of Underlying  Shares issuable upon exercise of a Placement Agent Warrant
immediately prior to such action shall be adjusted so that the

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Holder shall be entitled to receive the number of shares of capital stock of the
Company at the same  aggregate  Exercise  Price that the Holder would have owned
immediately  following  such  action  had  such  Placement  Agent  Warrant  been
exercised  immediately  prior  thereto.  An  adjustment  made  pursuant  to this
paragraph shall become effective  immediately  after the record date in the case
of a dividend and shall become effective immediately after the effective date in
the case of a subdivision,  combination or reclassification It as a result of an
adjustment made pursuant to this paragraph,  the Holder  thereafter shall become
entitled  to  receive  shares of two or more  classes  of  capital  stock of the
Company,  the Board of Directors of the Company  (whose  determination  shall be
conclusive)  shall  determine  the  allocation  of the adjusted  Exercise  Price
between or among shares of such classes of capital stock.

                  (b) Reclassification  Combinations,  Mergers.  etc, In case of
any  reclassification  or change of outstanding  shares of Common Stock issuable
upon  exercise  of the  Placement  Agent  Warrants  (other  than as set forth in
paragraph  (a) above and 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),  or in case of any  consolidation or merger of the Company with
or into another  corporation or entity (other than a merger in which the Company
is the continuing  corporation and which does not result in any reclassification
or change of the then outstanding  shares of Common Stock or other capital stock
issuable upon exercise of the Placement Agent  Warrants),  or in the case of any
sale or  conveyance  of all or  substantially  all of the assets of the  Company
followed by a related distribution to holders of shares of Common Stock of cash,
securities  or other  property,  then as a condition  of such  reclassification,
change,  consolidation,  merger,  or  sale  of  assets,  the  Company  or such a
successor corporation or entity, as the case may be, shall forthwith make lawful
and adequate  provision  whereby each Holder shall have the right  thereafter to
receive on exercise of a Placement  Agent  Warrant the kind and amount of shares
of  stock   and   other   securities   and   property   receivable   upon   such
reclassification,  change. consolidation, merger, or sale of assets, by a holder
of the number of shares of Common Stock issuable upon exercise of such Placement
Agent Warrant immediately prior to such reclassification, change, consolidation,
merger,  or sale of assets,  and enter into a supplemental  warrant agreement so
providing. Such provisions shall include provision for adjustments that shall be
as nearly  equivalent as may be practicable to the  adjustments  provided for in
this  Section 4. If the issuer of  securities  deliverable  upon  exercise  of a
Placement Agent Warrant under the supplemental warrant agreement is an affiliate
of the formed or surviving  corporation or other entity,  that issuer shall join
in the supplemental warrant agreement. The above provisions of this subparagraph
(b) shall similarly apply to successive  reclassifications and changes of shares
of Common Stock and to successive consolidations or mergers.

                  (c)  In  the  event  that  at  any  time,  as a  result  of an
adjustment made pursuant to this Section 4, each Holder shall become entitled to
receive any  securities  of the Company  other than the  Underlying  Securities,
thereafter the number of such other  securities so receivable upon exercise of a
Placement  Agent  Warrant and the Price  applicable  to such  exercise  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 shares of Common
Stock contained in this Section 4.

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                  (d) Notice of Change in Exercise Price. Upon any adjustment of
the Exercise Price pursuant to Section 4, the Company shall promptly  thereafter
(i) cause to be prepared a  certificate  of the  President  and Chief  Financial
Officer of the  Company  setting  forth the  adjusted  Exercise  Price  and,  in
reasonable  detail,  the  method of  calculation  and the facts  upon which such
calculations  are based,  and setting forth the number of Underlying  Securities
(or portion thereof) issuable after such adjustment,  which certificate shall be
conclusive  evidence of the  correctness of the matters set forth therein absent
manifest error, provided that if a Holder reasonably requests, the Company shall
engage a firm of independent public accountants of recognized  standing selected
by the Board of Directors of the Company (who may be the regular auditors of the
Company) to prepare and file such  certificate in lieu of the certificate of the
President and Chief Financial  Officer,  in which case such certificate shall be
conclusive  evidence of the matters set forth therein absent manifest error, and
(ii)  send to  each  Holder  at the  address  appearing  on the  registry  books
maintained by the Company  written  notice of such  adjustments  by  first-class
mail, postage prepaid.

                  (e)  Notice of  Certain  Events.  With  respect  to any Notice
Event,  the  Company  shall  cause to be given to each  Holder at such  Holder's
address  appearing on the registry books maintained by the Company,  at least 20
days prior to the applicable record date hereinafter  specified,  or promptly in
the case of events  for which  there is no record  date,  by first  class  mail,
postage  prepaid,  a written notice stating (i) the date as of which the holders
of record of the Common  Stock  entitled  to receive any such  rights,  options,
warrants or distribution is to be determined,  (ii) the initial  expiration date
set forth in any tender offer or exchange  offer for shares of Common Stock,  or
(iii) the date on which any such consolidation,  merger,  conveyance,  transfer,
dissolution,  liquidation  or  winding up is  expected  to become  effective  or
consummated,  and the date as of which it is expected  that holders of record of
shares of Common Stock shall be entitled to exchange such shares for  securities
or  other   property,   if  any,   deliverable   upon   such   reclassification,
consolidation, merger, conveyance, transfer, dissolution, liquidation or winding
up. The  failure to give the notice  required by this  subsection  or any defect
therein  shall not affect the legality or validity of any  distribution,  right,
option, warrant,  consolidation,  merger, conveyance,  transfer, dissolution, or
liquidation  or  winding  up, or the vote upon any  action,  provided  that each
Holder  shall  retain any right to damages from the Company with respect to such
failure.


      SECTION 5. Change in Number of the Underlying  Warrants and the Underlying
Warrant Purchase Price. Under the Warrant Agreement, the Company may elect, upon
any  adjustment of the exercise  price of the Warrants,  to adjust the number of
Warrants  outstanding  in lieu of adjusting the number of shares of Common Stock
purchasable upon the exercise of each Warrant,  so that each Warrant outstanding
after such adjustment  shall represent the right to purchase one share of Common
Stock.  In such a case (i) the  Underlying  Warrant  Purchase Price shall become
that  price  (calculated  to the  nearest  1/1,000  of one cent)  determined  by
multiplying the Underlying Warrant Purchase Price in effect immediately prior to
such  adjustment  by a fraction,  the  numerator  of which shall be the exercise
price of the Warrants in effect  immediately  prior to such  adjustment  and the
denominator of which shall be the exercise price of the Warrants in

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effect  immediately after such adjustment and (ii) each Underlying Warrant under
this  Placement  Agent  Warrant  that has not  been  purchased  pursuant  to the
exercise of such Placement  Agent Warrant prior to such adjustment of the number
of Warrants shall become that number of Underlying  Warrants  (calculated to the
nearest  tenth)  determined  by  multiplying  the number one by a fraction.  the
numerator  of  which  shall be the  exercise  price of the  Warrants  in  effect
immediately  prior to such  adjustment and the denominator of which shall be the
exercise price of the Warrants in effect immediately after such adjustment. Upon
each  adjustment  of such  Underlying  warrants  pursuant to this Section 5. the
Company  shall,  as promptly as  practicable,  cause to be  distributed  to each
Holder,  on the date of such  adjustment,  Placement Agent Warrant  Certificates
evidencing,  subject to Section 6(b) hereof, the number of additional Underlying
Warrants to which such Holder  shall be entitled as a result of such  adjustment
or, at the option of the  Company,  cause to be  distributed  to such  Holder in
substitution and replacement for the Placement Agent Warrant  Certificates  held
by such Holder prior to the date of adjustment (and upon surrender  thereof,  if
required by the Company) new Placement Agent Warrant Certificates evidencing the
number of Underlying  Warrants to which such Holder shall be entitled after such
adjustment.

      SECTION 6.  Other-Provisions Relating to Rights of a Holder.

                  (a) Holder not  Stockholder.  A Holder,  as such, shall not be
entitled to vote or receive  dividends  or be deemed a holder of Common Stock or
Warrants of the Company for any purpose,  nor shall  anything  contained in this
Agreement  be  construed  to confer  upon the Holder,  as such,  any rights of a
holder of Common  Stock or  Warrants of the Company or the right to vote or give
or  withhold   consent  to  any  action  by  the  Company   (whether   upon  any
recapitalization,  issue of stock,  reclassification  of  stock,  consolidation,
merger,  conveyance or  otherwise),  receive  notice of meetings or other action
affecting  holders of Common Stock or Warrants  (except for notices provided for
in this Agreement), receive dividends or subscription rights, or otherwise until
the Underlying  Units shall be deliverable  upon exercise of the Placement Agent
Warrant Certificate.

                  (b) Fractional Shares or Warrants.  Anything  contained herein
to the contrary notwithstanding,  the Company shall not be required to issue any
fractional shares of Underlying Shares or Underlying Warrants in connection with
the  exercise  of a Placement  Agent  Warrant  Certificate.  In any case where a
Holder would,  except for the provisions of this Section 6(b), be entitled under
the terms of this  Agreement  to receive a fraction  of an  Underlying  Share or
Underlying  Warrant upon the exercise of a Placement Agent Warrant  Certificate,
the Company shall  round-up to the next highest  Underlying  Shares and the next
highest Underlying Warrant, as the case may be.

                  (c)  Holder  Absolute  Owner.  Prior  to due  presentment  for
registration of transfer of any Placement Agent Warrant Certificate, the Company
may deem and treat the Holder as the absolute owner thereof.


                                     10

<PAGE>

      SECTION 7.   Exchange and Transfer of Placement Agent Warrants

                  (a) Request.  At the request of the Holder,  a Placement Agent
Warrant  Certificate  may be divided split up,  combined or exchanged for one or
more other Placement Agent Warrant Certificates of like tenor to purchase a like
aggregate number of Underlying  Units. The request shall be in writing delivered
to the  Company at its office in Troy,  Michigan  accompanied  by the  Placement
Agent Warrant  Certificate[s] to be so divided,  split up, combined or exchanged
at said office.  Upon any such surrender,  the Company shall execute and deliver
to the person entitled thereto new Placement Agent Warrant  Certificate[s] as so
requested.  The  Company  may  require  the  surrendering  Holder  to  pay a sum
sufficient  to cover  any tax or  governmental  charge  that may be  imposed  in
connection therewith.

                  (b)   Assignment;   Replacement  of  Placement  Agent  Warrant
Certificates.  The  Placement  Agent  Warrants  may  not be  sold,  transferred,
assigned,  or  hypothecated,  in whole or in part, for a period of one year from
the effective date of the Offering,  except to officers of the Placement Agents.
Thereafter,  the Placement Agent Warrants may be sold, transferred,  assigned or
hypothecated, in whole or in part, subject to federal and state securities laws.
Any  permitted  assignment  shall be made by  surrender of the  Placement  Agent
Warrant  Certificate  to the  Company at its  principal  office with the form of
assignment  attached  thereto duly executed and with funds sufficient to pay any
transfer  tax, in which event the Company  shall,  without  charge,  execute and
deliver a new Placement Agent Warrant Certificate in the name of the assignee so
named.  Upon receipt by the Company of evidence  satisfactory to it of the loss,
theft,  destruction or mutilation of a Placement  Agent Warrant  Certificate and
(in  the  case  of  loss,  theft  or  destruction)  of  reasonably  satisfactory
indemnification, and (in the cast of mutilation) upon surrender and cancellation
of such  Placement  Agent  Warrant  Certificate,  the Company  will  execute and
deliver a new Placement Agent Warrant Certificate of like tenor and date and any
such  lost,  stolen or  destroyed  Placement  Agent  Warrant  Certificate  shall
thereupon become void. Any such new Placement Agent Warrant Certificate executed
and delivered shall constitute an additional  contractual obligation on the part
of the Company,  whether or not the Placement Agent Warrant Certificate so lost,
stolen, destroyed or mutilated shall be at any time enforceable by anyone.

      SECTION 8.  Other Matters.

                  (a)  Taxes and  Charges.  The  Company  will from time to time
promptly pay,  subject to the  provisions of paragraph (v) of Section 2(b),  all
taxes and  charges  that may be  imposed  upon the  Company  in  respect  of the
issuance or delivery,  but not the transfer,  of the Placement Agent Warrants or
the Underlying Securities.

                  (b)  Notices to  Company.  Notice or demand  pursuant  to this
Agreement  to be given or made by a Holder to or on the Company  shall be deemed
given or made if delivered or sent by registered or certified mail, postage

                                     11

<PAGE>



prepaid,  return  receipt  requested,  and addressed,  until another  address is
designated in writing by the Company, or by facsimile transmission, as follows:

          Energy Conversion Devices, Inc.
          1675 West Maple Road
          Troy, Michigan 48084
          Attention: Roger J. Lesinski, Esq.
          Facsimile No.: (248) 280-1456

                  (c) Notices to the Placement Agents. Notice or demand pursuant
to this  agreement  to be given or made by the Company to the  Placement  Agents
shall be deemed given or made if delivered  or sent by  registered  or certified
mail, postage prepaid,  return receipt requested,  and addressed,  until another
address is designated in writing, or by facsimile transmission, as follows:



(i)   if to JMS:

          Janney Montgomery Scott Inc.26 Broadway
          New York, New York 10004
          Attention: Herbert M. Gardner
          Facsimile No.: (212) 510-0683



(ii) if to Nolan:

          Nolan Securities, Inc.
          1201 Elm Street
          Suite 3500
          Dallas, Texas 75270
          Attention: C. William Dedmon, Jr.
          Phone No.: (214) 651-1800
          Facsimile No.: (214) 658-9441


                                     12

<PAGE>





                  (d) Notices to Holders. Notice to Holders provided for in this
Agreement  shall be deemed  given or made by the Company if delivered or sent by
registered or certified mail, postage prepaid,  return receipt requested, to the
Holder's  address  appearing on the registry books maintained by the Company for
Holders of Placement Agent Warrant Certificates.

                  (e)   Governing   Law.  The   validity,   interpretation   and
performance of this Agreement  shall be governed by the laws of the State of New
York without giving effect to the conflicts of laws principles thereof.

                  (f) Exclusive Benefit.  Nothing in this Agreement expressed or
nothing that may be implied from any of the  provisions  hereof is intended,  or
shall be construed,  to confer upon, or give to any person or corporation  other
than the Company,  JMS,  Nolan,  and the Placement  Agents'  Warrant Holders any
right, remedy or claim hereunder, and all covenants,  conditions,  stipulations,
promises and agreements  contained in this  Agreement  shall be for the sole and
exclusive benefit of such persons and their successors,  survivors and permitted
assigns  hereunder.  This  Agreement is for the benefit of and is enforceable by
any subsequent Placement Agents' Warrant Holder.

                  (g) Headings.  The article  headings herein am for convenience
only and are not part of this Agreement and shall not affect the  interpretation
hereof.


            (THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK)



                                     13

<PAGE>



            IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and delivered as of the date first above written.

                                  ENERGY CONVERSION DEVICES, INC.


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

                                  JANNEY MONTGOMERY SCOTT INC.


                                    By: --------------------------------
                                          Herbert M. Gardner
                                          Senior Vice President


                                  NOLAN SECURITIES, CORPORATION


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

                                          Senior Vice President



                                      14

<PAGE>



                               EXHIBIT A

                             No.__________

                 PLACEMENT AGENTS' WARRANT CERTIFICATE



                    ENERGY CONVERSION DEVICES, INC.


 This  warrant  certificate  certifies  that   ______________________,   or  its
registered  assigns,  is the  registered  holder of a  Placement  Agent  Warrant
representing  the right to  purchase  _____  Units (the  "Underlying  Units") of
securities of Energy  Conversion  Devices,  Inc. (the "company") each Underlying
Unit consisting of one share of the Company's common stock, $.01 par value (each
an Underlying Share and,  collectively the "Underlying  Shares") and one warrant
to purchase one share of the Company's  common stock  issuable under the Warrant
Agreement between the Company and State Street Bank and Trust Company as warrant
agent.  (each  an  "Underlying  Warrant"  and,  collectively,   the  "Underlying
Warrants"). This Placement
     Agent Warrant expires on May ___, 2003 (the "Expiration Date".

            This  Placement  Agent  Warrant   entitles  the  registered   holder
(the"Holder")  upon exercise from time to time from 9:00 am., New York City time
on or after May ____,  1999 until 5:00 p.m New York City time on the  Expiration
Date to purchase Underlying Units at $_______ per Underlying Unit (the "Exercise
Price") in lawful money of the United  States of America upon  surrender of this
certificate  and payment of the  Exercise  Price.  The Exercise  Price,  and the
number of Underlying  Shares and Underlying  Warrants  issuable upon exercise of
this  Placement  Agent Warrant are subject to adjustment  upon the occurrence of
certain events set forth in the Placement Agents' Warrant Agreement.

            This Placement Agent Warrant may not be exercised after 5:00 p.m. on
the  Expiration  Date and to the extent not exercised by such tirne shall become
void.

            This  warrant  certificate  shall be  governed by and  construed  in
accordance with the internal laws of the State of New York.

            IN WITNESS WHEREOF,  Energy conversion Devices, Inc. has caused this
warrant certificate to be signed by its President and its Secretary.

Dated: ----------------

                                    ENERGY CONVERSION DEVISIONS, INC.



                                    ------------------------------------
                                    President


                                    A-1

<PAGE>



                                    ------------------------------------
                                    Treasurer


                                    A-2

<PAGE>


                           FORM OF ASSIGNMENT


            For value  received,  the  undersigned  hereby  sells,  assigns  and
transfers unto ______________ whose address is ________________________and whose
social security or other identifying number is ______________________  the right
to purchase __________  Underlying Units evidenced by the within Placement Agent
Warrant,  and hereby  irrevocably  constitutes and appoints the Secretary of the
Company as his, her or its attorney-in-fact to transfer the same on the books of
the Company with full power of substitution and  resubstitution.  If said number
of  Underlying  Units  is less  than  all of the  Underlying  Units  purchasable
hereunder,   the  undersigned  requests  that  a  new  Placement  Agent  Warrant
Certificate  representing  the right to purchase the balance of such  Underlying
Units  be   registered  in  the  name  of   _______________   whose  address  is
________________  and  whose  social  security  or other  identifying  number is
_______________  and that such Placement Agent Warrant  Certificate be delivered
to ___________ whose address is ______________________.


Dated: ----------




                           SUBSCRIPTION FORM

            The  undersigned  hereby  irrevocably  elects to exercise the right,
represented by this Placement Agent Warrant  Certificate,  to purchase  ________
Underlying  Units and tenders  payment  herewith in the amount of $_______.  The
undersigned requests that a certificate for the Underlying Shares and Underlying
Warrants  constituting  the  Underlying  Units  be  registered  in the  name  of
____________,  whose address is ___________________ and whose social security or
other identifying  number is  ______________.  If said number of Underlying Sham
and/or  Underlying  Warrants is less than all of the  Underlying  Shares  and/or
Underlying Warrants purchasable  hereunder,  the undersigned requests that a new
Placement  Agent  Warrant  Certificate  representing  the right to purchase  the
balance of such Underlying  Shares and Underlying  Warrants be registered in the
name of  _______________________  whose  address is  ________________  and whose
social  security  or other  identifying  number  is  ____________  and that such
Placement Agent Warrant Certificate be delivered to ____________________,  whose
address is ___________________.




Dated: -----------                  ------------------------------------
                                    Signature


                                    A-3

