Exhibit 10.2
SECURED CONVERTIBLE PROMISSORY NOTE

$475,500   December 13, 2006

     FOR VALUE RECEIVED, the undersigned, Sutura, Inc., a Delaware corporation
(the “Maker”), hereby promises to pay to the order of Whitebox Hedged High Yield
Partners, L.P., a British Virgin Islands limited partnership, or its assigns
(the “Payee”), at such place as the Payee may designate in writing, the
principal sum of Four Hundred Seventy-Five Thousand Five Hundred Dollars
($475,500) under the terms set forth herein. This Note is one of a series of
four Notes (together, the “Series Notes”) being issued by Maker on the date
hereof.
1. Interest. The unpaid principal balance hereof from time to time outstanding
shall bear interest from the date hereof at the rate of eight percent (8%) per
annum.
2. Payment. Except as otherwise provided herein, and subject to any default
hereunder, the principal and interest hereof is payable as follows:
     (a) Interest only is payable in cash or stock (as provided below) quarterly
in arrears on the last day of each calendar quarter, beginning March 31, 2007.
          (i) The parties hereby agree that the Company may pay interest due
hereunder, or any portion thereof, by issuing to the Payee fully paid and
nonassessable shares of Maker’s Common Stock, par value $0.001 per share, in
lieu of cash. The number of shares of Common Stock issuable upon payment of any
portion of an interest payment hereunder in stock shall be computed by dividing
each such applicable portion of the interest payment to be paid in shares of
Common Stock by the Conversion Rate (as defined below ) in effect at such time.
          (ii) The Conversion Rate shall be equal to the greater of (i) $0.045
per share; or (ii) the average of the daily closing bid prices for the Company’s
Common Stock over a period of 30 consecutive Trading Days. The last day of such
30 day period will be the Trading Day immediately prior to the day in which a
interest payment is due. A “Trading Day” is (x) a day on which the Common Stock
is traded on the New York Stock Exchange, the American Stock Exchange, the
NASDAQ National Market, the NASDAQ SmallCap Market or OTC Bulletin Board (all
“Trading Markets”), or (y) if the Common Stock is not quoted on any Trading
Market, a day on which the Common Stock is quoted in the over-the-counter market
as reported by the Pink Sheets, LLC (or any similar organization or agency
succeeding to its function of reporting prices).
          (iii) Any Common Stock issued in payment of any portion of the
interest payments shall have those registration rights set forth in the
Registration Rights Agreement.
     (b) On June 30, 2008 (the “Maturity Date”), the remaining outstanding
principal balance of this Note will be due and payable in cash, together with
all then-accrued but unpaid interest.
     (c) Except as provided herein, the Maker will have no right of early
prepayment on this Note.

 

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3. Conversion.
     (a) At any time while any portion of the principal or interest of this Note
is outstanding, the Payee may give the Maker written notice (the “Payee Notice”)
of its intention to convert all or any portion of the outstanding principal
and/or accrued but unpaid interest on this Note into shares of the Maker’s
Common Stock based on a conversion rate as described below (the “Conversion
Rate”). The number of shares of Common Stock issuable upon payment of any
portion of the outstanding principal and/or accrued but unpaid interest on this
Note shall be computed by dividing each such applicable portion of the payment
to be paid in shares of Common Stock by the Conversion Rate in effect at such
time. Upon receipt of the Payee Notice, the Maker shall immediately cause
certificates dated the Payee Notice date and representing these shares to be
delivered to Payee within 20 days of, and payment shall be deemed to have been
made on, the date of the Payee Notice.
     (b) The Conversion Rate shall initially be equal to $0.045.
     (c) The Conversion Rate (and, as applicable, the factors above used to
compute it) shall be adjusted proportionally for any subsequent stock dividend
or split, stock combination or other similar recapitalization, reclassification
or reorganization of or affecting Maker’s Common Stock. In case of any
consolidation or merger to which the Maker is a party other than a merger or
consolidation in which the Maker is the continuing corporation, or in case of
any sale or conveyance to another corporation of the property of the Maker as an
entirety or substantially as an entirety, or in the case of any statutory
exchange of securities with another corporation (including any exchange effected
in connection with a merger of a third corporation into the Maker), then instead
of receiving shares of Maker’s Common Stock, Payee shall have the right
thereafter to receive the kind and amount of shares of stock and other
securities and property which the Payee would have owned or have been entitled
to receive immediately after such consolidation, merger, statutory exchange,
sale or conveyance had the same portion of this Note been paid or converted
immediately prior to the effective date of such consolidation, merger, statutory
exchange, sale or conveyance and, in any such case, if necessary, appropriate
adjustment shall be made in the application of the provisions set forth in this
Section with respect to the rights and interests thereafter of the Payee, to the
end that the provisions set forth in this Section shall thereafter
correspondingly be made applicable, as nearly as may reasonably be, in relation
to any shares of stock and other securities and property thereafter deliverable
in connection with this Note. The provisions of this subsection shall similarly
apply to successive consolidations, mergers, statutory exchanges, sales or
conveyances.
     (d) Any Common Stock issued in payment of all any portion of the
outstanding principal and/or accrued but unpaid interest on this Note shall have
those registration rights set forth in the Registration Rights Agreement of even
date herewith by and among Maker, Payee and certain other parties thereto.
4. Security. The full and timely payment of this Note shall be secured by that
certain Fourth Amended Security Agreement and Fourth Amended Patent and
Trademark Security Agreement, each of this date (together, the “Security
Agreements”), covering all of Maker’s assets. The security interest granted
under the Security Agreements shall be a first priority

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security interest subordinate to no other secured rights, but shared with the
other holders of the Series Notes and the secured parties under the Security
Agreements.
5. Default. The occurrence of any one or more of the following events shall
constitute an event of default, upon which Payee may declare the entire
principal amount of this Note, together with all accrued but unpaid interest, to
be immediately due and payable:
     (a) The Maker shall fail to make any required payment of principal or
interest when due, and such failure shall continue through five days after Payee
gives written notice of such failure to Maker.
     (d) The Maker shall fail to materially perform or comply with any covenant,
agreement, term or provision contained in any of the Security Agreements, and
such failure shall continue through five days after Payee gives written notice
of such default to Maker.
     (e) The Maker shall be in default of any term or provision of any of the
promissory notes sold pursuant that certain Purchase Agreement dated
September 7, 2005 among Sutura, the Payee and the other purchasers named therein
(the “September 2005 Notes”), or any of the promissory notes sold pursuant to
that certain Purchase Agreement dated March 25, 2005 among Sutura, the Payee and
the other purchasers named there (the “March 2005 Notes”), or any of the
promissory notes sold pursuant to that certain Purchase Agreement dated
September 17, 2004 among Sutura, the Payee and the other purchasers named
therein (the “September 2004 Notes”), and such default is not cured within five
days after written notice from Payee to Sutura.
     (f) The Maker shall become insolvent or shall fail to pay, or become unable
to pay, its debts as they become due; or any bankruptcy, reorganization, debt
arrangement or other proceeding under any bankruptcy or insolvency law shall be
instituted by or against the Maker.
     (g) Any representation or warranty of the Maker contained in any of the
Security Agreements shall be untrue in any material respect.
     (h) The Maker incurs an event of default under the terms of any of the
other Series Notes.
     Without limiting the above, the Maker acknowledges that payments on the
various scheduled due dates in Sections 2 are of essence and that any failure to
timely pay any installment of principal or interest (within any permitted grace
period above) permits Payee to declare this Note immediately due in cash in its
entirety without any prior notice of any kind to Maker, except for the specific
notices provided above. Further, the Maker agrees that any event of default
under this Note shall constitute an event of default under each of the other
Series Notes, the September 2005 Notes, the March 2005 Notes and the
September 2004 Notes.
6. Mandatory Prepayments. If Maker or its controlling stockholders enter into a
definitive agreement relating to a Sale Transaction, the Maker shall give Payee
at least fifteen days prior written notice of the proposed date for consummation
of the Sale Transaction. The Maker’s notice shall include a description of the
proposed price, terms and conditions of the Sale Transaction. Despite any other
provisions hereof, the entire principal balance of this Note, and all accrued
but unpaid interest, shall be due and payable immediately prior to (and as a
condition

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of) the closing on the Sale Transaction. However, within fifteen days after
receipt of Maker’s notice, Payee may give written notice to Maker that Payee
elects to convert all or any portion of the outstanding principal and/or accrued
but unpaid interest on this Note into shares of the Maker’s Common Stock (in
which case, the Payee’s notice will constitute a Payee Notice under Section 3
above and the portion of this Note not so converted will be retired in cash as
otherwise provided in this Section).
     The Maker shall not consummate any Sale Transaction, the price, terms and
conditions of which materially deviate from those described in Maker’s notice to
the Payee, without first giving the Payee a new notice specifying such changes.
Such new notice will commence a new 15-day period during which time Payee may
give its notice to Maker as provided above. Nothing in this Section will
restrict the Maker’s ability to effect a Sale Transaction if Maker complies with
the foregoing provisions hereof.
7. Limitations on Conversion. Notwithstanding anything to the contrary contained
herein, the number of shares of Common Stock that may be acquired by the Payee
upon any conversion of this Note (or otherwise in respect hereof) shall be
limited to the extent necessary to insure that, following such conversion (or
other issuance), the total number of shares of Common Stock then beneficially
owed by Payee and its affiliates and any other persons whose beneficial
ownership of Common Stock would be aggregated with the Payee’s for purposes of
Section 13(d) of the Exchange Act does not exceed 9.99% of the total number of
issued and outstanding shares of Common Stock (including for such purpose the
shares of Common Stock issuable upon such conversion or payment). For such
purposes, beneficial ownership shall be determined in accordance with Section
13(d) of the Exchange Act and the rules and regulations promulgated thereunder.
This provision shall not restrict the number of shares of Common Stock which
Payee may receive or beneficially own in order to determine the amount of
securities or other consideration that Payee may receive in the event of a
merger, sale or other transaction as contemplated in Section 3(c) of this Note.
8. Applicable Law. THE VALIDITY, CONSTRUCTION AND ENFORCEABILITY OF THE NOTE
SHALL BE GOVERNED BY THE INTERNAL LAWS OF THE STATE OF MINNESOTA, WITHOUT GIVING
EFFECT TO CONFLICT OF LAWS PRINCIPLES THEREOF.
9. Waivers. The Maker hereby waives presentment for payment, notice of dishonor,
protest and notice of payment and all other notices of any kind in connection
with the enforcement of this Note.
10. No Setoffs. The Maker shall pay principal and interest under the Note
without any deduction for any setoff or counterclaim.

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11. Costs of Collection. If this Note is not paid when due, the Maker shall pay
Payee’s reasonable costs of collection, including reasonable attorney’s fees.

            SUTURA, INC.
      By           David Teckman, President and        Chief Executive Officer 
   

Sutura.Secured Convertible Note (12.06)

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