Exhibit 10.64


 


REGISTRATION
RIGHTS AGREEMENT


 


This
Registration Rights Agreement (this “Agreement”) is made and entered
into as
of                         ,
2004, among MFIC Corporation, a Delaware corporation (the “Company”),
and the purchasers signatory hereto (each such purchaser is a “Purchaser”
and all such purchasers are, collectively, the “Purchasers”).


 


This Agreement is made pursuant to the
Subscription Agreement(s), dated as of the date hereof among the Company and
each of the Purchasers (the “Subscription Agreement(s)”).  The signature of each Purchaser to his, her
or its Subscription Agreement is deemed to be, and is effective as, such
Purchasers’ signature hereto.


 


The Company and the Purchasers hereby agree
as follows


 


1.             Certain Definitions.  Capitalized terms used and not otherwise
defined herein that are defined in the Subscription Agreements shall have the
meanings given such terms in the Subscription Agreements.  As used in this Agreement, the following
terms shall have the following respective meanings:


 


“Commission” shall mean the Securities and Exchange Commission or any
other federal agency at the time administering the Securities Act.


 


“Exchange Act” shall mean the
Securities Exchange Act of 1934, as amended, or any similar successor federal
statute and the rules and regulations thereunder, all as the same shall be in
effect from time to time.


 


“Holders” shall mean the Purchasers
and any holder of Registrable Securities to whom the registration rights
conferred by this Agreement have been transferred.


 


“Registrable Securities” shall mean (i) Common Stock held by the Holders, (ii) the
Warrant Shares, (iii) the Common Stock issuable upon exercise of warrants
held by Casimir Capital L.P. or its assigns or designees, or (iv) any
Common Stock issued as a dividend or other distribution with respect to or in
exchange for or in replacement of the stock referenced in (i), (ii) or
(iii) above.


 


The terms “register”, “registered” and “registration” shall refer to a
registration effected by preparing and filing a registration statement in
compliance with the Securities Act and applicable rules and
regulations thereunder, and the declaration or ordering of the effectiveness of
such registration statement.


 


“Registration Expenses” shall mean all expenses
incurred by the Company in compliance with the registration obligation of the
Company, including, without limitation, all registration and filing fees,
printing expenses, fees and disbursements of counsel for the Company.


 


“Restricted Securities” shall mean
the securities of the Company required to bear or bearing the legend set forth
in Section 3 hereof.


 

















 


“Selling Expenses” shall mean all underwriting discounts, selling
commissions and expense allowances applicable to the sale of Registrable
Securities and all fees and disbursements of counsel for any Holder.


 


2.             Restrictions on Transferability.  The Securities and any other securities
issued in respect of the Securities upon any stock split, stock dividend,
recapitalization, merger, consolidation, or similar event, shall not be
transferred except upon the conditions specified in this Agreement, which
conditions are intended to ensure compliance with the provisions of the
Securities Act.  Any transferee of such
securities shall take and hold such securities subject to the provisions and
upon the conditions specified in this Agreement.


 


3.             Restrictive Legend.  Each certificate representing the Securities,
the shares of Common Stock underlying the Warrants and any other securities
issued in respect of the Securities upon any stock split, stock dividend,
recapitalization, merger, consolidation or similar event, shall (unless
otherwise permitted or unless the securities evidenced by such certificate
shall have been registered under the Securities Act) be stamped or otherwise
imprinted with a legend substantially in the following form (in addition to any
legend required under applicable state securities laws):


 


THE SECURITIES REPRESENTED BY
THIS CERTIFICATE HAVE BEEN ACQUIRED FOR INVESTMENT AND HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”) OR ANY STATE SECURITIES LAWS. 
SUCH SECURITIES MAY NOT BE SOLD OR OFFERED FOR SALE IN THE ABSENCE OF
SUCH REGISTRATION OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY AND ITS
COUNSEL THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE ACT.


 


Upon
request of Purchaser, the Company shall remove the foregoing legend from the
certificate or issue to such holder a new certificate therefor free of any
transfer legend, if, with such request, the Company shall have received either an
opinion of counsel or the “no-action” letter
referred to in Section 4 to the effect that any transfer by such holder of the securities
evidenced by such certificate will not violate the Securities Act and
applicable state securities laws, unless any such transfer legend may be
removed pursuant to Rule 144 or any
successor rule, in which case no such opinion or “no-action” letter shall be required.


 


The Company acknowledges and agrees that a Purchaser may from time to
time pledge pursuant to a bona fide margin agreement or grant a security
interest in some or all of the Registrable Securities and, if required under
the terms of such arrangement, such Purchaser may transfer pledged or secured
Registrable Securities to the pledgees or secured parties.  If required by the Company’s transfer agent
in order to effect a pledge, the Company shall cause its counsel, at no cost to
the Purchasers, to issue an opinion of counsel to the Company’s transfer
agent.  Further, no notice shall be
required of such pledge.  At the
appropriate Purchaser’s expense, the Company will execute and deliver such
reasonable documentation as a pledgee or secured party of Securities may
reasonably request in connection with a pledge or transfer of the Registrable
Securities, including the preparation and filing of any required prospectus
supplement under Rule 424(b)(3) of the Securities Act or other applicable
provision of the Securities Act to appropriately amend the list of selling
stockholders thereunder.


 


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Certificates
evidencing shares of Common Stock (including shares underlying the Warrants)
shall not contain any legend (i) while a registration statement covering the
resale of such security is effective under the Securities Act, or (ii)
following any sale of such shares pursuant to Rule 144, or (iii) if such shares
are eligible for sale under Rule 144(k), or (iv) if such legend is not required
under applicable requirements of the Securities Act (including judicial
interpretations and pronouncements issued by the staff of the Commission).  If all or any portion of a Warrant is
converted or exercised at a time when there is an effective registration
statement to cover the resale of the underlying shares, or if such underlying
shares of Common Stock may be sold under Rule 144 or if such legend is not
otherwise required under applicable requirements of the Securities Act
(including judicial interpretations thereof) then such underlying shares shall
be issued free of all legends.  The
Company agrees that following the effective date of the registration statement
required to be filed hereunder or at such time as such legend is no longer
required, it will, no later than three trading days following the delivery by a
Purchaser to the Company or the Company’s transfer agent of a certificate
representing shares of Common Stock issued with a restrictive legend, deliver
or cause to be delivered to such Purchaser a certificate representing such
shares that is free from all restrictive and other legends.  The Company may not make any notation on its
records or give instructions to any transfer agent of the Company that enlarge
the restrictions on transfer set forth in this Section.


 


4.             Notice of Proposed Transfers.  The holder of each certificate representing
Restricted Securities by acceptance thereof agrees to comply in all respects
with the provisions of this Section 4. 
Prior to any proposed transfer of any Restricted Securities, the holder
thereof shall give written notice to the Company of such holder’s intention to
affect such transfer.  Each such notice
shall describe the manner and circumstances of the proposed transfer in
sufficient detail, and shall be accompanied by either (i) if required, a
written opinion of legal counsel to the holder who shall be reasonably
satisfactory to the Company, addressed to the Company, to the effect that the
proposed transfer of the Restricted Securities may be effected without
registration under the Securities Act or (ii) a “no-action” letter from
the Commission to the effect that the distribution of such securities without
registration will not result in a recommendation by the staff of the Commission
that action be taken with respect thereto, whereupon the holder of such Restricted
Securities shall be entitled to transfer such Restricted Securities in
accordance with the terms of the notice delivered by such holder to the
Company. The Company will not require such a legal opinion or “no action”
letter (x) in any transaction in compliance with Rule 144 promulgated
under the Securities Act, (y) in any transaction in which the Purchaser
distributes Restricted Securities solely to its stockholders on a pro rata
basis for no consideration, or (z) in any transaction in which a holder which
is a partnership or limited liability company distributes Restricted Securities
solely to its partners or members, as applicable, for no consideration;
provided that each transferee agrees in writing to be subject to the terms of
this Section 4.  Each certificate
evidencing the Restricted Securities transferred as above provided shall bear
the restrictive legend set forth in Section 3 above.


 


5.             Registration.


 


(i)            The Company
shall file a registration statement on Form SB-2 or other appropriate registration
document under the Securities Act for resale of Common Stock  and shall use its best efforts to maintain
the registration effective  for a
period of 24 months (or so long


 


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as a Holder
is subject to the volume limitations of Rule 144(e) under the Securities Act
(the “Effectiveness Period”)).  The
Company shall file such registration statement as soon as practicable following
the last closing of the Offering, but in any event no later than thirty (30) days
after the date of the Final Closing of the Offering, and shall cause such
registration statement to become effective within the earlier of (i)
the fifth trading day following
the date on which the Company is notified by the Commission that such registration
statement will not be reviewed or is no longer subject to further review and
comments or (ii) ninety (90) days after the date of such final
closing of the Offering (120 days in the event of a “full review” by the
Commission).


 


(ii)           Notwithstanding
the foregoing, the Company shall not be obligated to take any action pursuant
to this Section 5 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 in such jurisdiction and except as may be required
by the Securities Act.


 


(iii)          In the
event that the Company fails to file the registration statement pursuant to
this Section 5 within thirty (30) days after the last closing date or if
such registration statement has not been declared effective within ninety
(90) days after the date of the Final Closing of the Offering (120 days in
the event of a “full review” by the Commission) (such failure to file or become
effective, an “Event”), the Company shall pay to each such Holder upon
the occurrence of each such Event and (y) on each monthly anniversary of the
date of each such Event  (if the
applicable Event shall not have been cured by such date) until the applicable
Event is cured, an amount in cash, as liquidated damages and not as a penalty,
equal to 1% of the aggregate purchase price paid by such Holder pursuant to its
Subscription Agreement.  If the Company
fails to pay any liquidated damages pursuant to this Section in full within
seven days after the date payable, the Company will pay interest thereon at a
rate of 15% per annum (or such lesser maximum amount that is permitted to be
paid by applicable law) to the Holder, accruing daily from the date such
liquidated damages are due until such amounts, plus all such interest thereon,
are paid in full.  The liquidated
damages pursuant to the terms hereof shall apply on a pro-rata basis for any
portion of a month prior to the cure of an Event.


 


(iv)          If during the
Effectiveness Period, the number of Registrable Securities at any time exceeds
100% of the number of shares of Common Stock then registered in a registration
statement required hereunder, then the Company shall file as soon as reasonably
practicable but in any case prior to the 30th day following the date
such number is exceeded, an additional registration statement covering the
resale of by the Holders of not less than all of such Registrable Securities
and the Company shall use commercially reasonable efforts to cause such
registration statement to be declared effective as soon as reasonably
practicable thereafter.


 


6.             Expenses of Registration.  The Company shall bear all Registration
Expenses incurred in connection with any registration, qualification or
compliance pursuant to this Agreement and all underwriting discounts, selling
commissions and expense allowances applicable to the sale of any securities by
the Company for its own account in any registration.  All Selling Expenses shall be borne by the Holders whose
securities are included in such registration pro rata on the basis of the
number of their Registrable Securities so registered.


 


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7.             Indemnification.


 


(i)            The Company
will indemnify each Holder, each of its officers, directors, agents, employees
and partners, and each person controlling such Holder, with respect to each
registration, qualification or compliance effected pursuant to this Agreement,
and each underwriter, if any, and each person who controls any underwriter, and
their respective counsel against all claims, losses, damages and liabilities
(or actions, proceedings or settlements in respect thereof) arising out of or
based on any untrue statement (or alleged untrue statement) of a material fact
contained in any prospectus, offering circular or other document prepared by
the Company (including any related registration statement, notification or the
like) incident to any such registration, qualification or compliance, or based
on any omission (or alleged omission) to state therein a material fact required
to be stated therein or necessary to make the statements therein not
misleading, or any violation by the Company of the Securities Act or any rule
or regulation thereunder applicable to the Company and relating to action or
inaction required of the Company in connection with any such registration,
qualification or compliance, and will reimburse each such Holder, each of its
officers, directors, agents, employees and partners, and each person
controlling such Holder, each such underwriter and each person who controls any
such underwriter, for any legal and any other expenses as they are reasonably
incurred in connection with investigating and defending any such claim, loss,
damage, liability or action, provided that the Company will not be liable in
any such case to the extent that any such claim, loss, damage, liability or
expense arises primarily and directly out of or is based on any untrue
statement (or alleged untrue statement) or omission (or alleged omissions)
based upon written information furnished to the Company by such Holder or
underwriter and stated to be specifically for use therein.


 


(ii)           Each Holder
whose Registrable Securities are included in any registration, qualification or
compliance effected pursuant to this Agreement will indemnify the Company, each
of its directors and officers and each underwriter, if any, of the Company’s securities covered by such a
registration statement, each person who controls the Company or such
underwriter within the meaning of the Securities Act and the rules and
regulations thereunder, each other such Holder and each of their officers,
directors and partners, and each person controlling such Holder, and their
respective counsel against all claims, losses, damages and liabilities (or
actions in respect thereof) arising primarily and directly out of or based on
any untrue statement (or alleged untrue statement) of a material fact contained
in any such registration statement, prospectus, offering circular or other
document, or any omission (or alleged 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 Company and such Holders, directors,
officers, partners, persons, underwriters or control persons for any legal or
any other expenses as they are reasonably incurred in connection with
investigating or defending any such claim, loss, damage, liability or action,
in each case to the extent, but only to the extent, that such untrue statement
(or alleged untrue statement) or omission (or alleged omission) is made in such
registration statement, prospectus, offering circular or other document in
reliance upon and in conformity with written information furnished to the
Company by such Holder and stated to be specifically for use therein; provided,
however, that the obligations of such Holders hereunder shall be limited
to an amount equal to the net proceeds to each such Holder sold under such
registration statement, prospectus, offering circular or other document as
contemplated herein.


 


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(iii)          Each party
entitled to indemnification under this Section 7 (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 any litigation resulting therefrom, 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 if
any Indemnified Party reasonably concludes that there may be one or more legal
defenses available to it that are not available to the Indemnifying Party, or
that such claim or litigation involves or could have an effect on matters
beyond the scope of this Agreement, then the Indemnified Party may retain its
own counsel at the expense of the Indemnifying Party; 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 and only to the extent that such failure to give notice results in
material prejudice to the Indemnifying Party. 
No Indemnifying Party, in the defense of any such claim or litigation,
shall, except with the consent of each Indemnified Party, consent to entry of
any judgment or enter into any settlement which does not include as an unconditional
term thereof the giving by the claimant or plaintiff to such Indemnified Party
of a release from all liability in respect to such claim or litigation.  Each Indemnified Party shall furnish such
information regarding itself or the claim in question as an Indemnifying Party
may reasonably request in writing and as shall be reasonably required in
connection with defense of such claim and litigation resulting therefrom.


 


(iv)          If the indemnification
provided for in this Section 7 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 herein, then the
Indemnifying Party, in lieu of indemnifying such Indemnified Party hereunder,
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.


 


8.             Transfer or
Assignment of Rights. The benefits to the Holder hereunder may be
transferred or assigned by a Holder to a transferee or assignee of any of the
Restricted Securities, provided that the Company is given written notice prior
to the time that such right is exercised, stating the name and address of said
transferee or assignee and identifying the securities with respect to which
such registration rights are being transferred or assigned; provided further
that the transferee or assignee of such rights assumes in writing the
obligations of the Holder under this Agreement.


 


9.             Registration
Procedures.  In the case of the
registration effected by the Company pursuant to this Agreement, the Company
will keep each Holder who is entitled to registration benefits


 


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hereunder advised in writing as
to the initiation of each registration and as to the completion thereof.  At its expense, the Company will:


 


(i)            Prepare and file with
the Commission 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 securities covered by such registration statement;


 


(ii)           Respond as promptly as
reasonably possible, and in any event within ten days, to any comments received
from the Commission with respect to a registration statement or any amendment
thereto.


 


(iv)          Notify the Holders as
promptly as reasonably possible and (if requested by any such person) confirm
such notice in writing no later than one trading day following the day (i)(A)
when a Prospectus or any Prospectus supplement or post-effective amendment to a
registration statement is proposed to be filed and (B) with respect to a
registration statement or any post-effective amendment, when the same has
become effective;


 


(v)           Furnish such number of
prospectuses and other documents incident thereto, including supplements and
amendments, as a Holder may reasonably request; and


 


(vi)          Furnish to each selling
Holder, upon request, a copy of all documents filed with and all correspondence
from or to the Commission in connection with any such registration statement
other than nonsubstantive cover letters and the like.


 


(vii)         Use its best efforts to
avoid the issuance of, or, if issued, obtain the withdrawal of (i) any order
suspending the effectiveness of a registration statement, or (ii) any
suspension of the qualification (or exemption from qualification) of any of the
Registrable Securities for sale in any jurisdiction, at the earliest
practicable moment.


 


(viii)        Comply with all applicable
rules and regulations of the Commission.


 


(ix)           The Company may require
each selling Holder to furnish to the Company a certified statement as to the
number of shares of Common Stock beneficially owned by such Holder and, if
requested by the Commission, the controlling person thereof.


 


10.           Rule 144
Reporting.  With a view to making
available the benefits of certain rules and regulations of the Commission which
may permit the sale of the Restricted Securities to the public without
registration, the Company agrees to:


 


(i)            Make and keep public
information available, as those terms are understood and defined in
Rule 144 under the Securities Act; and


 


(ii)           Use its reasonable best
efforts to file with the Commission in a timely manner all reports and other
documents required of the Company under the Securities Act and the Exchange
Act.


 


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11.           Reporting Under the Exchange Act. The Company agrees to take no action designed to, or with the
effect of, causing the Company to cease to be subject to the reporting
requirements of the Exchange Act for so long as a registration statement under
this Agreement is required to be filed or caused to be effective, or shall be
required to be or remain effective.


 


12.           Miscellaneous.


 


(i)            Neither the Company
nor any of its security holders (other than the Holders in such capacity
pursuant hereto) may include securities of the Company in the registration
statement required to be filed hereunder other than the Registrable Securities,
and the Company shall not after the date hereof enter into any agreement
providing any such right to any of its security holders.  The Company shall not file any other
registration statement until the initial registration statement required hereunder
is declared effective by the Commission.


 


(ii) Compliance.
Each Holder covenants and agrees that it will comply with the prospectus
delivery requirements of the Securities Act as applicable to it in connection
with sales of Registrable Securities pursuant to the registration statement
required hereunder.


 


(iii) Piggy-Back
Registrations. If at any time during the Effectiveness Period there is not
an effective registration statement covering all of the Registrable Securities
and the Company shall determine to prepare and file with the Commission a
registration statement relating to an offering for its own account or the
account of others under the Securities Act of any of its equity securities,
other than on Form S-4 or Form S-8 (each as promulgated under the Securities
Act) or their then equivalents relating to equity securities to be issued
solely in connection with any acquisition of any entity or business or equity
securities issuable in connection with stock option or other employee benefit
plans, then the Company shall send to each Holder written notice of such
determination and, if within fifteen days after receipt of such notice, any
such Holder shall so request in writing, the Company shall include in such
registration statement all or any part of such Registrable Securities such
holder requests to be registered; provided, that, the Company shall not be
required to register any Registrable Securities pursuant to this Section that
are eligible for resale pursuant to Rule 144(k) promulgated under the
Securities Act.


 


(iv)          Notices. Any and
all notices or other communications or deliveries required or permitted to be
provided hereunder shall be delivered as set forth in the Subscription
Agreement(s).


 


(v)           Successors and
Assigns. This Agreement shall inure to the benefit of and be binding upon
the successors and permitted assigns of each of the parties and shall inure to
the benefit of each Holder. The Company may not assign its rights or
obligations hereunder without the prior written consent of all of the Holders
of the then-outstanding Registrable Securities. Each Holder may assign their
respective rights hereunder in the manner and to the persons as permitted under
the Subscription Agreement(s) provided that no Holder may transfer or assign
its rights hereunder to any person unless such person agrees in writing to be
bound by and to perform all of the terms and conditions of this Agreement.


 


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(vi)          Counterparts.
This Agreement may be executed in any number of counterparts, each of which
when so executed shall be deemed to be an original and, all of which taken
together shall constitute one and the same Agreement. In the event that any
signature is delivered by facsimile transmission, such signature shall create a
valid binding obligation of the party executing (or on whose behalf such
signature is executed) the same with the same force and effect as if such
facsimile signature were the original thereof.


 


(vii)         Governing Law. All
questions concerning the construction, validity, enforcement and interpretation
of this Agreement shall be governed by and construed and enforced in accordance
with the internal laws of the State of New York, without regard to the
principles of conflicts of law thereof.


 


(viii)        Severability. If
any term, provision, covenant or restriction of this Agreement is held by a
court of competent jurisdiction to be invalid, illegal, void or unenforceable,
the remainder of the terms, provisions, covenants and restrictions set forth
herein shall remain in full force and effect and shall in no way be affected,
impaired or invalidated, and the parties hereto shall use their reasonable
efforts to find and employ an alternative means to achieve the same or
substantially the same result as that contemplated by such term, provision,
covenant or restriction. It is hereby stipulated and declared to be the
intention of the parties that they would have executed the remaining terms,
provisions, covenants and restrictions without including any of such that may
be hereafter declared invalid, illegal, void or unenforceable.


 


(ix)           Headings. The
headings in this Agreement are for convenience of reference only and shall not
limit or otherwise affect the meaning hereof.


 


(x)            Independent Nature
of Purchasers’ Obligations and Rights. The obligations of each Purchaser
hereunder is several and not joint with the obligations of any other Purchaser
hereunder, and no Purchaser shall be responsible in any way for the performance
of the obligations of any other Purchaser hereunder. Nothing contained herein
or in any other agreement or document delivered at any closing, and no action
taken by any Purchaser pursuant hereto or thereto, shall be deemed to
constitute the Purchasers as a partnership, an association, a joint venture or
any other kind of entity, or create a presumption that the Purchasers are in
any way acting in concert with respect to such obligations or the transactions
contemplated by this Agreement. Each Purchaser shall be entitled to protect and
enforce its rights, including without limitation the rights arising out of this
Agreement, and it shall not be necessary for any other Purchaser to be joined
as an additional party in any proceeding for such purpose.


 


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


 


 


	
   

  	
  MFIC CORPORATION

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
					



 


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