Exhibit 4.4
EXECUTION
COPY
REGISTRATION RIGHTS
AGREEMENT
THIS REGISTRATION RIGHTS
AGREEMENT (this “
Agreement ”) is dated as of September 20, 2006,
between Monarch Pointe Fund, Ltd. (“ Monarch
”), Mercator Momentum Fund, L.P. (“ MMF
”), Mercator Momentum Fund III, L.P. (“ MMF
III ”), M.A.G. Capital, LLC (“
MAG ”) and each of the undersigned additional
accredited investors signatories hereto (the “
Accredited Investors ,” and together with
M.A.G, Monarch, MMF and MMF III, referred to individually as a
“ Holder ” and collectively as the
“ Holders ”) and Diametrics Medical, Inc.
a Minnesota corporation (the “ Company
”).
WHEREAS , on the date hereof, the Holders (other than
MAG) have purchased from the Company, for aggregate consideration
of $28,500,000, 2,850 shares of the Company’s Series J
Convertible Preferred Stock (the “ Series J
Stock ”), and have the right to cause such Series J
Stock to be converted into shares of the Company’s common
stock, par value $0.01 per share (the “ Common
Stock ”), pursuant to the conversion formula set
forth in the Certificate of Designations of Series J Convertible
Preferred Stock as filed with the Secretary of State of the State
of Minnesota on or about September 20, 2006 (the “
Certificate of Designations ”);
WHEREAS , on the date hereof, MAG has acquired warrants
(the “ Warrants ”) from the Company,
pursuant to which MAG has the right to purchase in the aggregate up
to 6,500,000 shares of Common Stock; and
WHEREAS , the Company desires to grant to the Holders
the registration rights set forth herein with respect to the shares
of Common Stock issuable upon the conversion of the Series J Stock
and the exercise of the Warrants.
NOW, THEREFORE
, the parties hereto mutually agree
as follows:
1. Registrable
Securities . As used herein the terms “
Registrable Security ” means each share of
Common Stock (A) issuable (i) upon the conversion of the
Series J Stock (the “ Conversion Shares
”), (ii) upon exercise of the Warrants (the “
Warrant Shares ”) or (iii) upon the
exercise or conversion of the other securities set forth in
Section 2(b) hereof and (B) issued as a dividend or other
distribution with respect to or in exchange for or in replacement
of the shares referenced in clause (A) above , provided,
however , that with respect to any particular Registrable
Security, such security shall cease to be a Registrable Security as
of the date of determination that it has been effectively
registered under the Securities Act of 1933, as amended (the
“ Securities Act ”), and disposed of
pursuant thereto. The term “ Registrable
Securities ” means any and/or all of the securities
falling within the foregoing definition of a “Registrable
Security.” In the event of any merger, reorganization,
consolidation, recapitalization or other change in corporate
structure affecting the Common Stock, such adjustment shall be made
in the definition of “Registrable Security” as is
appropriate in order to prevent any dilution or enlargement of the
rights granted pursuant to this Section 1.
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2. Registration
.
(a) The Company shall prepare or
file a registration statement on Form SB-2 or Form S-3 (the “
Registration Statement ”) with the Securities
and Exchange Commission (the “ SEC ”) no
later than the later of (x) the date that is ninety
(90) days from the date hereof or (y) the date that is
five (5) business days following the receipt of the
Shareholder Approval (as defined in the Certificate of
Designations) (such date of filing, the “ Filing
Date ”), in order to register the resale of the
Registrable Securities under the Securities Act. The Company shall
use its commercially reasonable efforts to cause the Registration
Statement to be declared effective no later than the date that is
60 days after the Filing Date in the event the SEC has no comments
on the Registration Statement (or by the date that is 120 days
after the Filing Date in the event the SEC has comments on the
Registration Statement). Once effective, the Company shall use its
commercially reasonable efforts to maintain the effectiveness of
the Registration Statement until earlier of the date that all of
the Registrable Securities have been sold and the third anniversary
of the effectiveness date of such Registration Statement (such
date, the “ Expiration Date
”).
(b) The Company will initially
include in the Registration Statement as Registrable Securities
(i) the maximum number of shares of Common Stock issuable upon
conversion of the Series J Stock, (ii) the maximum number of
shares of Common Stock issuable upon exercise of the Warrants,
(iii) the maximum number of shares of Common Stock issued or
issuable upon the conversion of all outstanding shares of Series H
Convertible Preferred Stock, Series I Convertible Preferred Stock
and the $750,000 Convertible Promissory Notes issued by the Company
prior to the date hereof, (iv) the maximum number of shares of
Common Stock issued or issuable upon the exercise of all
outstanding warrants issued by the Company on or prior to the date
hereof and (v) and the maximum number of shares of Common
Stock issued or issuable upon the exercise of all outstanding stock
options issued by the Company on or prior to the date
hereof.
(c) In the event that the Company
fails to have the Registration Statement declared effective by the
SEC by the date that is 60 days after the Filing Date, in the event
the SEC has no comments on the Registration Statement, or by the
date that is 120 days after the Filing Date, in the event the SEC
has comments on the Registration Statement, or maintain the
effectiveness of the Registration Statement thereafter (each, a
“ Registration Effectiveness Default ”),
then the Company shall pay the Holders an amount equal to $6,250
for each day that such Registration Effectiveness Default remains
uncured; provided, however , that the obligation of the
Company to pay such amount shall cease on the second anniversary of
the date hereof. The Company shall pay such amount upon demand to
MAG, for distribution pro rata to the Holders, by wire transfer of
immediately available funds to such account as MAG may designate in
writing to the Company.
3. Covenants of the Company
with Respect to Registration .
The Company covenants and agrees as
follows:
(a) If any stop order shall be
issued by the SEC in connection therewith, the Company shall use
its commercially reasonable efforts to obtain promptly the removal
of such
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order. Following the effective date of the
Registration Statement, the Company shall, upon the request of any
Holder, forthwith supply such reasonable number of copies of the
Registration Statement, preliminary prospectus and prospectus
meeting the requirements of the Securities Act, and any other
documents necessary or incidental to the public offering of the
Registrable Securities, as shall be reasonably requested by any
Holder to permit such Holder to make a public distribution of such
Holder’s Registrable Securities. The obligations of the
Company hereunder with respect to any Holder’s Registrable
Securities are subject to such Holder’s furnishing to the
Company such appropriate information concerning such Holder, such
Holder’s Registrable Securities and the terms of such
Holder’s offering of such Registrable Securities as the
Company may reasonably request in writing.
(b) Prepare and file with the SEC
such amendments and supplements to such Registration Statement and
the prospectus used in connection with such Registration Statement
as may be necessary to comply with the provisions of the Securities
Act with respect to the disposition of all securities covered by
such Registration Statement;
(c) Notify each seller of
Registrable Securities covered by such Registration Statement at
any time when a prospectus relating thereto is required to be
delivered under the Securities Act of the happening of any event as
a result of which the prospectus included in such Registration
Statement, as then in effect, includes an untrue statement of a
material fact or omits to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading in the light of the circumstances then existing, and at
the request of any such seller, prepare and furnish to such seller
a reasonable number of copies of a supplement to or an amendment of
such prospectus as may be necessary so that, as thereafter
delivered to the purchaser of such shares, such prospectus shall
not include an untrue statement of a material fact or omit to state
a material fact required to be stated therein or necessary to make
the statements therein not misleading in the light of the
circumstances then existing;
(d) Use its commercially reasonable
efforts to register and qualify the securities covered by such
Registration Statement under such other securities or blue sky laws
of such jurisdictions as shall be reasonably requested by the
Holders, provided that the Company shall not be required in
connection therewith or as a condition thereto to qualify to do
business or to file a general consent to service of process in any
such states or jurisdictions;
(e) Cause all such Registrable
Securities to be listed on each securities exchange on which
similar securities issued by the Company are then
listed;
(f) Provide a transfer agent and
registrar for all Registrable Securities and a CUSIP number for all
such Registrable Securities, in each case not later than the
effective date of such registration;
(g) Use its commercially reasonable
efforts to furnish, at the request of any Holder, on the date that
such Holder’s Registrable Securities are delivered to the
underwriters for sale in connection with a registration pursuant to
this Agreement, if such securities are being sold through
underwriters, or, if such securities are not being sold through
underwriters, on the date that the Registration Statement with
respect to such securities becomes effective, (i) an opinion,
dated such date, of the counsel representing the Company for the
purposes of such registration,
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in form and substance as is customarily given to
underwriters in an underwritten public offering, addressed to the
underwriters, if any, and to the Holders and (ii) if
appropriate, a letter, dated such date, from the independent
certified public accountants of the Company, in form and substance
as is customarily given by independent certified public accountants
to underwriters in an underwritten public offering, addressed to
the underwriters, if any, and to the Holders (to the extent the
then-applicable standards of professional conduct permit said
letter to be addressed to the Holders).
(h) The Company shall pay all costs,
fees and expenses in connection with the Registration Statement
filed pursuant to Section 2 hereof including, without
limitation, the Company’s legal and accounting fees, all
registration, qualification, listing and filing fees, printing
expenses, escrow fees, and blue sky fees and expenses; provided,
however , that each Holder shall be solely responsible for the
fees of any counsel retained by such Holder in connection with such
registration and any transfer taxes or underwriting discounts,
commissions or fees applicable to the Registrable Securities sold
by such Holder pursuant thereto.
4. Additional Terms
.
(a) To the extent permitted by law,
the Company will indemnify each Holder, each of its officers,
directors, partners, legal counsel, and accountants, and each
person controlling such Holder within the meaning of
Section 15 of the Securities Act, with respect to which
registration, qualification, or compliance has been effected
pursuant t
