Exhibit 10.1
SECURITIES PURCHASE AGREEMENT
     This Securities Purchase Agreement (this “Agreement”) is dated as of
November 29, 2005, among MicroMed Cardiovascular, Inc., a Delaware corporation
(the “Company”), on the one hand, and each purchaser identified on the signature
pages hereto (each, including its successors and assigns, a “Purchaser” and
collectively the “Purchasers”) on the other hand;
     WHEREAS, subject to the terms and conditions set forth in this Agreement
and pursuant to Section 4(2) of the Securities Act (as defined below), and
Rule 506 promulgated thereunder, the Company desires to issue and sell to each
Purchaser, and each Purchaser, severally and not jointly, desires to purchase
from the Company in the aggregate, up to $5,150,000 of shares of Common Stock on
the Closing Date.
     NOW, THEREFORE, IN CONSIDERATION of the mutual covenants contained in this
Agreement, and for other good and valuable consideration the receipt and
adequacy of which are hereby acknowledged, the Company and each Purchaser agrees
as follows:
ARTICLE I
DEFINITIONS
     1.1 Definitions. In addition to the terms defined elsewhere in this
Agreement, for all purposes of this Agreement, the following terms have the
meanings indicated in this Section 1.1:
          “Action” shall have the meaning ascribed to such term in
Section 3.1(i).
          “Affiliate” means any Person that, directly or indirectly through one
or more intermediaries, controls or is controlled by or is under common control
with a Person as such terms are used in and construed under Rule 144. With
respect to a Purchaser, any investment fund or managed account that is managed
on a discretionary basis by the same investment manager as such Purchaser will
be deemed to be an Affiliate of such Purchaser.
          “Anti-Dilution Shares” means any Shares issued further to Section 4.9
hereof or further to Section 4.9 of the August 2005 Securities Purchase
Agreement.
          “August 2005 Purchase Agreement” means that Securities Purchase
Agreement dated as of August 9, 2005 by and among the Company and certain
purchasers named therein.
          “Closing” means the closing of the purchase and sale of the Shares and
the Placement Agent Warrants pursuant to Section 2.1.
          “Closing Date” means the date when all of the Transaction Documents
have been executed and delivered by the applicable parties thereto, and all
conditions precedent to (i) the Purchasers’ obligations to pay the Subscription
Amount and (ii) the Company’s obligations to deliver the Shares have been
satisfied or waived.
          “Commission” means the Securities and Exchange Commission.

 

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          “Common Stock” means the common stock of the Company, par value $0.001
per share, and any securities into which such common stock may hereafter be
reclassified.
          “Common Stock Equivalents” means any securities of the Company or the
Subsidiaries which would entitle the holder thereof to acquire at any time
Common Stock, including without limitation, any debt, preferred stock, rights,
options, warrants or other instrument that is at any time convertible into or
exchangeable for, or otherwise entitles the holder thereof to receive, Common
Stock.
          “Disclosure Schedules” means the Disclosure Schedules of the Company
delivered concurrently herewith.
          “Effective Date” means the date that the Registration Statement is
first declared effective by the Commission.
          “Exchange Act” means the Securities Exchange Act of 1934, as amended.
          “Exempt Issuance” means the issuance of (a) shares of Common Stock or
options to employees, officers or directors of the Company pursuant to any stock
or option plan duly adopted by a majority of the non-employee members of the
Board of Directors of the Company or a majority of the members of a committee of
non-employee directors established for such purpose, (b) securities upon the
exercise of or conversion of any securities issued hereunder, or convertible
securities, options or warrants issued and outstanding on the date of this
Agreement, provided that such securities have not been amended since the date of
this Agreement to increase the number of such securities, (c) securities issued
pursuant to strategic transactions with an operating company in a business
synergistic with the business of the Company and in which the Company receives
benefits in addition to the investment of funds or pursuant to acquisitions, but
shall not include a transaction in which the Company is issuing securities
primarily for the purpose of raising capital or to an entity whose primary
business is investing in securities; and (d) securities issued to consultants
for services rendered to the Company in non-capital raising transactions in an
amount per individual issuance not to exceed 30,000 shares for particular
services rendered.
          “GAAP” shall have the meaning ascribed to such term in Section 3.1(h).
          “Hunter” means Hunter World Markets, Inc.
          “Intellectual Property Rights” shall have the meaning ascribed to such
term in Section 3.1(k).
          “Legend Removal Date” shall have the meaning ascribed to such term in
Section 4.1(c).
          “Liens” means a lien, charge, security interest, encumbrance, right of
first refusal, preemptive right or other restriction.
          “Material Adverse Effect” shall have the meaning ascribed to such term
in Section 3.1(b).

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          “Material Permits” shall have the meaning ascribed to such term in
Section 3.1(i).
          “Per Share Purchase Price” equals $0.75, subject to adjustment for
reverse and forward stock splits, stock dividends, stock combinations and other
similar transactions of the Common Stock that occur after the date of this
Agreement.
          “Person” means an individual or corporation, partnership, trust,
incorporated or unincorporated association, joint venture, limited liability
company, joint stock company, government (or an agency or subdivision thereof)
or other entity of any kind.
          “Placement Agent Agreement” means that certain Placement Agent
Agreement between the Company and Hunter.
          “Placement Agent Warrants” means those warrants to be issued to Hunter
further to the Placement Agent Agreement.
          “Proceeding” means an action, claim, suit, investigation or proceeding
(including, without limitation, an investigation or partial proceeding, such as
a deposition), whether commenced or threatened.
          “Registration Rights Agreement” means the Registration Rights
Agreement, dated as of the date of this Agreement, among the Company and each
Purchaser, providing for the registration of the Shares in the form of Exhibit A
attached hereto.
          “Registration Statement” means a registration statement meeting the
requirements set forth in the Registration Rights Agreement and covering the
resale by the Purchasers of the Shares.
          “Required Approvals” shall have the meaning ascribed to such term in
Section 3.1(e).
          “Rule 144” means Rule 144 promulgated by the Commission pursuant to
the Securities Act, as such Rule may be amended from time to time, or any
similar rule or regulation hereafter adopted by the Commission having
substantially the same effect as such Rule.
          “Securities Act” means the Securities Act of 1933, as amended.
          “Shares” means the shares of the Company’s Common Stock issued or
issuable to each Purchaser pursuant to this Agreement.
          “Subscription Amount” means, as to each Purchaser, the amounts set
forth below such Purchaser’s signature block on the signature page hereto, in
United States dollars and in immediately available funds.
          “Subsidiary” shall mean the subsidiaries of the Company, if any, set
forth on Schedule 3.1(a).

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          “Trading Day” means a day on which the Common Stock is traded on a
Trading Market.
          “Trading Market” means the following markets or exchanges on which the
Common Stock is listed or quoted for trading on the date in question: the
American Stock Exchange, the New York Stock Exchange, the Nasdaq National
Market, the Nasdaq SmallCap Market or the OTC Bulletin Board.
          “Transaction Documents” means this Agreement, the Registration Rights
Agreement, the Placement Agent Warrants and any other documents or agreements
executed in connection with the transactions contemplated hereunder.
ARTICLE II
PURCHASE AND SALE
     2.1 Closing. On the Closing Date, each Purchaser shall purchase from the
Company, severally and not jointly with the other Purchasers, and the Company
shall issue and sell to each Purchaser, a number of Shares equal to such
Purchaser’s Subscription Amount divided by the Per Share Purchase Price. Upon
satisfaction of the conditions set forth in Section 2.3, the Closing shall occur
at the offices of Troy & Gould, located at 1801 Century Park East, 16th Floor,
Los Angeles, California 90067, or such other location as the parties shall
mutually agree. The aggregate Subscription Amounts for the Shares sold hereunder
shall be up to $5,150,000. Notwithstanding the foregoing, the payment of the
aggregate Subscription Amounts and disbursement of funds shall be through an
escrow with Wells Fargo Bank, Los Angeles, California or such other escrow agent
as Hunter approves (the “Escrow Agent”). The Company and each Purchaser
acknowledge and agree that $150,000 of the Subscription Amount for the Shares
results from the conversion of the issuance of that certain Term Note in the
principal amount of $150,000 by and between the Company as Borrower and The
Hunter Fund Limited as payee pursuant to that certain Term Credit Agreement
dated October 13, 2005 by and between the Company and The Hunter Fund Limited.
     2.2 Deliveries.
          (a) On the Closing Date, the Company shall deliver or cause to be
delivered to each Purchaser or Hunter, as the case may be the following:
               (i) this Agreement duly executed by the Company;
               (ii) a copy of the irrevocable instructions to the Company’s
transfer agent instructing the transfer agent to deliver, on an expedited basis,
a certificate evidencing a number of Common Shares equal to such Purchaser’s
Subscription Amount divided by the Per Share Purchase Price, registered in the
name of such Purchaser;
               (iii) the Placement Agent Warrants;
               (iv) the Registration Rights Agreement duly executed by the
Company; and

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               (v) an executed Lock-Up Agreement in the form attached hereto as
Annex B from each of Richard From and Peyton, Chandler & Sullivan, Inc.
          (b) On the Closing Date, each Purchaser shall deliver or cause to be
delivered to the Company the following:
               (i) this Agreement duly executed by such Purchaser;
               (ii) such Purchaser’s Subscription Amount by wire transfer of
same day funds to the account as specified in writing by the Escrow Agent; and
               (iii) the Registration Rights Agreement duly executed by such
Purchaser.
     2.3 Closing Conditions.
          (a) The obligations of the Company hereunder in connection with the
Closing are subject to the following conditions being met:
               (i) the accuracy in all material respects when made and on the
Closing Date of the representations and warranties of the Purchasers contained
herein;
               (ii) all obligations, covenants and agreements of the Purchasers
required to be performed at or prior to the Closing Date shall have been
performed; and
               (iii) the delivery by the Purchasers of the items set forth in
Section 2.2(b) of this Agreement.
          (b) The respective obligations of the Purchasers hereunder in
connection with the Closing are subject to the following conditions being met:
               (i) the accuracy in all material respects on the Closing Date of
the representations and warranties of the Company contained herein;
               (ii) all obligations, covenants and agreements of the Company
required to be performed at or prior to the Closing Date shall have been
performed;
               (iii) the delivery by the Company of the items set forth in
Section 2.2(a) of this Agreement;
               (iv) there shall have been no Material Adverse Effect with
respect to the Company since the date hereof;
               (v) the Company shall have in force a Lock-Up Agreement in the
form attached hereto as Annex B from each of Richard From and Peyton, Chandler &
Sullivan, Inc.; and
               (vi) The Purchasers shall have received an opinion of counsel to
the Company in form and substance reasonably satisfactory to the Purchasers.

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ARTICLE III
REPRESENTATIONS AND WARRANTIES
     3.1 Representations and Warranties of the Company. Except as set forth
under the corresponding section of the Disclosure Schedules which Disclosure
Schedules shall be deemed a part hereof, the Company hereby makes the
representations and warranties set forth below to each Purchaser:
          (a) Subsidiaries. All of the direct and indirect subsidiaries of the
Company, if any, are set forth on Schedule 3.1(a). The Company owns, directly or
indirectly, all of the capital stock or other equity interests of each
Subsidiary free and clear of any Liens, and all the issued and outstanding
shares of capital stock of each Subsidiary are validly issued and are fully
paid, non-assessable and free of preemptive and similar rights to subscribe for
or purchase securities. If the Company has no subsidiaries, then references in
the Transaction Documents to the Subsidiaries will be disregarded.
          (b) Organization and Qualification. Each of the Company and the
Subsidiaries is an entity duly incorporated or otherwise organized, validly
existing and in good standing under the laws of the jurisdiction of its
incorporation or organization (as applicable), with the requisite power and
authority to own and use its properties and assets and to carry on its business
as currently conducted. Neither the Company nor any Subsidiary is in violation
or default of any of the provisions of its respective certificate or articles of
incorporation, bylaws or other organizational or charter documents. Each of the
Company and the Subsidiaries is duly qualified to conduct business and is in
good standing as a foreign corporation or other entity in each jurisdiction in
which the nature of the business conducted or property owned by it makes such
qualification necessary, except where the failure to be so qualified or in good
standing, as the case may be, could not have or reasonably be expected to result
in (i) a material adverse effect on the legality, validity or enforceability of
any Transaction Documents, (ii) a material adverse effect on the results of
operations, assets, business, prospects or financial condition of the Company
and the Subsidiaries, taken as a whole, or (iii) a material adverse effect on
the Company’s ability to perform in any material respect on a timely basis its
obligations under any Transaction Documents (any of (i), (ii) or (iii), a
“Material Adverse Effect”) and no Proceeding has been instituted in any such
jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or
curtail such power and authority or qualification.
          (c) Authorization; Enforcement. The Company has the requisite
corporate power and authority to enter into and to consummate the transactions
contemplated by each of the Transaction Documents and otherwise to carry out its
obligations thereunder. The execution and delivery of each of the Transaction
Documents by the Company and the consummation by it of the transactions
contemplated thereby have been duly authorized by all necessary action on the
part of the Company and no further action is required by the Company in
connection therewith other than in connection with the Required Approvals. Each
of the Transaction Documents has been (or upon delivery will have been) duly
executed by the Company and, when delivered in accordance with the terms hereof,
will constitute the valid and binding obligation of the Company enforceable
against the Company in accordance with its terms except (i) as limited by
applicable bankruptcy, insolvency, reorganization, moratorium and other laws of
general application affecting enforcement of creditors’ rights generally,
(ii) as limited by laws relating to

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the availability of specific performance, injunctive relief or other equitable
remedies and (iii) insofar as indemnification and contribution provisions may be
limited by applicable law.
          (d) No Conflicts. The execution, delivery and performance of the
Transaction Documents by the Company, the issuance and sale of the Shares and
the consummation by the Company of the other transactions contemplated thereby
do not and will not (i) conflict with or violate any provision of the Company’s
or any Subsidiary’s certificate or articles of incorporation, bylaws or other
organizational or charter documents, or (ii) conflict with, or constitute a
default (or an event that with notice or lapse of time or both would become a
default) under, result in the creation of any Lien upon any of the properties or
assets of the Company or any Subsidiary, or give to others any rights of
termination, amendment, acceleration or cancellation (with or without notice,
lapse of time or both) of, any agreement, credit facility, debt or other
instrument (evidencing a Company or Subsidiary debt or otherwise) or other
understanding to which the Company or any Subsidiary is a party or by which any
property or asset of the Company or any Subsidiary is bound or affected, or
(iii) subject to the Required Approvals, conflict with or result in a violation
of any law, rule, regulation, order, judgment, injunction, decree or other
restriction of any court or governmental authority to which the Company or a
Subsidiary is subject (including federal and state securities laws and
regulations), or by which any property or asset of the Company or a Subsidiary
is bound or affected; except in the case of each of clauses (ii) and (iii), such
as could not have or reasonably be expected to result in a Material Adverse
Effect.
          (e) Filings, Consents and Approvals. The Company is not required to
obtain any consent, waiver, authorization or order of, give any notice to, or
make any filing or registration with, any court or other federal, state, local
or other governmental authority or other Person in connection with the
execution, delivery and performance by the Company of the Transaction Documents,
other than (i) filings required pursuant to Section 4.4 of this Agreement,
(ii) the filing with the Commission of the Registration Statement,
(iii) application(s) to each applicable Trading Market for the listing of the
Common Shares for trading thereon in the time and manner required thereby, and
(iv) the filing of Form D with the Commission and such filings as are required
to be made under applicable state securities laws (collectively, the “Required
Approvals”).
          (f) Issuance of the Securities. The Shares are duly authorized and,
when issued and paid for in accordance with the Transaction Documents, will be
duly and validly issued, fully paid and nonassessable, free and clear of all
Liens imposed by the Company other than restrictions on transfer provided for in
the Transaction Documents. The Company has reserved from its duly authorized
capital stock the maximum number of shares of Common Stock issuable pursuant to
this Agreement.
          (g) Capitalization. The authorized capital stock of the Company
consists of 100,000,000 shares of common stock, $.001 par value per share, and
50,000,000 shares of preferred stock, $.001 par value per share. As of the date
hereof, there were 18,611,361 shares of common stock outstanding, 36,978 shares
held as Treasury Stock and 1,500,000 shares held in escrow and no shares of
preferred stock outstanding. In addition, there were outstanding options and
warrants to purchase 4,299,823 shares of common stock and an option to purchase
588,428 shares issuable pursuant to the exercise of anti-dilution rights granted
to purchasers in the August

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2005 Securities Purchase Agreement. All of the outstanding shares of capital
stock of the Company are validly issued, fully paid and nonassessable, have been
issued in compliance with all federal and state securities laws, and none of
such outstanding shares was issued in violation of any preemptive rights or
similar rights to subscribe for or purchase securities. No further approval or
authorization of any stockholder, the Board of Directors of the Company or
others is required for the issuance and sale of the Shares. There are no
stockholders agreements, voting agreements or other similar agreements with
respect to the Company’s capital stock to which the Company is a party or, to
the knowledge of the Company, between or among any of the Company’s
stockholders.
          (h) Material Changes. Since September 30, 2005, (i) the Company has
not incurred any liabilities (contingent or otherwise) other than (A) trade
payables and accrued expenses incurred in the ordinary course of business
consistent with past practice and (B) liabilities not required to be reflected
in the Financial Statements (as defined below) pursuant to GAAP, and (C) a
bridge loan to the Company in the amount of $150,000 from Hunter (ii) the
Company has not altered its method of accounting, and (iii) the Company has not
declared or made any dividend or distribution of cash or other property to its
stockholders or purchased, redeemed or made any agreements to purchase or redeem
any shares of its capital stock.
          (i) Litigation. There is no action, suit, inquiry, notice of
violation, proceeding or investigation pending or, to the knowledge of the
Company, threatened against or affecting the Company, any Subsidiary or any of
their respective properties before or by any court, arbitrator, governmental or
administrative agency or regulatory authority (federal, state, county, local or
foreign) (collectively, an “Action”) which (i) adversely affects or challenges
the legality, validity or enforceability of any of the Transaction Documents or
the Shares or (ii) could, if there were an unfavorable decision, have or
reasonably be expected to result in a Material Adverse Effect. Neither the
Company nor any Subsidiary, nor any current director or officer thereof, is or
has been the subject of any Action involving a claim of violation of or
liability under federal or state securities laws or a claim of breach of
fiduciary duty. There has not been, and to the knowledge of the Company, there
is not pending or contemplated, any investigation by the Commission involving
the Company or any current director or officer of the Company.
          (j) Permits. The Company and the Subsidiaries possess all
certificates, authorizations and permits issued by the appropriate federal,
state, local or foreign regulatory authorities necessary to conduct their
respective businesses, except where the failure to possess such permits could
not have or reasonably be expected to result in a Material Adverse Effect
(“Material Permits”), and neither the Company nor any Subsidiary has received
any notice of proceedings relating to the revocation or modification of any
Material Permit.
          (k) Patents and Trademarks. The Company and the Subsidiaries have, or
have rights to use, all patents, patent applications, trademarks, trademark
applications, service marks, trade names, copyrights, licenses and other similar
rights necessary or material for use in connection with their respective
businesses and which the failure to so have could have a Material Adverse Effect
(collectively, the “Intellectual Property Rights”). Neither the Company nor any
Subsidiary has received a written notice that the Intellectual Property Rights
used by the Company or any Subsidiary violates or infringes upon the rights of
any Person. To the

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knowledge of the Company, all such Intellectual Property Rights are enforceable
and there is no existing infringement by another Person of any of the
Intellectual Property Rights of others.
          (l) Certain Fees. Except for placement agent fees to Hunter, no
brokerage or finder’s fees or commissions are or will be payable by the Company
to any broker, financial advisor or consultant, finder, placement agent,
investment banker, bank or other Person with respect to the transactions
contemplated by this Agreement. The Purchasers shall have no obligation with
respect to any fees or with respect to any claims made by or on behalf of other
Persons for fees of a type contemplated in this Section that may be due in
connection with the transactions contemplated by this Agreement.
          (m) Private Placement. Assuming the accuracy of the Purchasers’
representations and warranties set forth in Section 3.2, no registration under
the Securities Act is required for the offer and sale of the Shares by the
Company to the Purchasers as contemplated hereby. Neither the Company nor any
person acting on behalf of the Company has offered or sold any of the Shares by
any form of general solicitation or general advertising. The Company has offered
the Shares for sale only to the Purchasers and certain other “accredited
investors” within the meaning of Rule 501 under the Securities Act.
          (n) Investment Company. The Company is not, and is not an Affiliate
of, and immediately after receipt of payment for the Shares, will not be or be
an Affiliate of, an “investment company” within the meaning of the Investment
Company Act of 1940, as amended. The Company shall conduct its business in a
manner so that it will not become subject to the Investment Company Act.
          (o) Registration Rights. No Person has any right to cause the Company
to effect the registration under the Securities Act of any securities of the
Company.
          (p) Financial Statements. The Company has made available to the
Purchasers its (a) audited balance sheets as at December 31, 2003 and 2004 and
related statements of operations, changes in stockholders equity and cash flows
for the years ended December 31, 2004 and 2003, and (b) unaudited balance sheets
as at September 30, 2005 and the related statement of operations, changes in
stockholders equity and cash flows for the nine months ended September 30, 2005
(collectively, the “Financial Statements”). The Financial Statements (i) were in
accordance with the books and records of the Company, (ii) are correct and
complete, (iii) fairly present the financial position and results of operations
of the Company as of the dates indicated, and (iv) are prepared in accordance
with U.S. GAAP (except that (x) unaudited financial statements may not be in
accordance with GAAP because of the absence of footnotes normally contained
therein, and (y) interim (unaudited) financials are subject to normal year-end
audit adjustments that in the aggregate will not have a material adverse effect
on the Company or its business, financial conditions or results of operations).
     3.2 Representations and Warranties of the Purchasers. Each Purchaser
hereby, for itself and for no other Purchaser, represents and warrants as of the
date hereof and as of the Closing Date to the Company as follows:

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          (a) Organization; Authority. Such Purchaser is an entity duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its organization with full right, corporate or partnership power
and authority to enter into and to consummate the transactions contemplated by
the Transaction Documents and otherwise to carry out its obligations thereunder.
The execution, delivery and performance by such Purchaser of the transactions
contemplated by this Agreement have been duly authorized by all necessary
corporate or similar action on the part of such Purchaser. Each of the
Transaction Documents to which it is a party has been duly executed by such
Purchaser, and when delivered by such Purchaser in accordance with the terms
hereof, will constitute the valid and legally binding obligation of such
Purchaser, enforceable against it in accordance with its terms, except (i) as
limited by general equitable principles and applicable bankruptcy, insolvency,
reorganization, moratorium and other laws of general application affecting
enforcement of creditors’ rights generally, (ii) as limited by laws relating to
the availability of specific performance, injunctive relief or other equitable
remedies and (iii) insofar as indemnification and contribution provisions may be
limited by applicable law.
          (b) Investment Intent. Such Purchaser understands that the Shares are
“restricted securities” and have not been registered under the Securities Act or
any applicable state securities law and is acquiring the Shares as principal for
its own account and not with a view to or for distributing or reselling such
Shares or any part thereof, has no present intention of distributing any of such
Shares and has no arrangement or understanding with any other persons regarding
the distribution of such Shares (this representation and warranty not limiting
such Purchaser’s right to sell the Shares pursuant to the Registration Statement
or otherwise in compliance with applicable federal and state securities laws).
Such Purchaser is acquiring the Shares hereunder in the ordinary course of its
business. Such Purchaser does not have any agreement or understanding, directly
or indirectly, with any Person to distribute any of the Shares.
          (c) Purchaser Status. At the time such Purchaser was offered the
Shares, it was, and at the date hereof it is, (i) an “accredited investor” as
defined in Rule 501(a)(1), (a)(2), (a)(3), (a)(7) or (a)(8) under the Securities
Act or (ii) a “qualified institutional buyer” as defined in Rule 144A(a) under
the Securities Act. Such Purchaser is not required to be registered as a
broker-dealer under Section 15 of the Exchange Act.
          (d) Experience of Such Purchaser. Such Purchaser, either alone or
together with its representatives, has such knowledge, sophistication and
experience in business and financial matters so as to be capable of evaluating
the merits and risks of the prospective investment in the Shares, and has so
evaluated the merits and risks of such investment. Such Purchaser is able to
bear the economic risk of an investment in the Shares and, at the present time,
is able to afford a complete loss of such investment.
          (e) General Solicitation. Such Purchaser is not purchasing the Shares
as a result of any advertisement, article, notice or other communication
regarding the Shares published in any newspaper, magazine or similar media or
broadcast over television or radio or presented at any seminar or any other
general solicitation or general advertisement.

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ARTICLE IV
OTHER AGREEMENTS OF THE PARTIES
     4.1 Transfer Restrictions.
          (a) The Shares may only be disposed of in compliance with state and
federal securities laws. In connection with any transfer of the Securities other
than pursuant to an effective registration statement or Rule 144, to the Company
or to an affiliate of a Purchaser or in connection with a pledge as contemplated
in Section 4.1(b), the Company may require the transferor thereof to provide to
the Company an opinion of counsel selected by the transferor and reasonably
acceptable to the Company, the form and substance of which opinion shall be
reasonably satisfactory to the Company, to the effect that such transfer does
not require registration of such transferred Securities under the Securities
Act. As a condition of transfer, any such transferee shall agree in writing to
be bound by the terms of this Agreement and shall have the rights of a Purchaser
under this Agreement and the Registration Rights Agreement.
          (b) The Purchasers agree to the imprinting, so long as is required by
this Section 4.1(b), of a legend on any of the Shares in the following form:
THESE SECURITIES HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO
AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH
APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO
THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY
ACCEPTABLE TO THE COMPANY. THESE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A
BONA FIDE MARGIN ACCOUNT WITH A REGISTERED BROKER-DEALER OR OTHER LOAN WITH A
FINANCIAL INSTITUTION THAT IS AN “ACCREDITED INVESTOR” AS DEFINED IN RULE 501(a)
UNDER THE SECURITIES ACT.
     The Company acknowledges and agrees that a Purchaser may from time to time
pledge pursuant to a bona fide margin agreement with a registered broker-dealer
or grant a security interest in some or all of the Shares to a financial
institution that is an “accredited investor” as defined in Rule 501(a) under the
Securities Act and who agrees to be bound by the provisions of this Agreement
and the Registration Rights Agreement and, if required under the terms of such
arrangement, such Purchaser may transfer pledged or secured Shares to the
pledgees or secured parties. Such a pledge or transfer would not be subject to
approval of the Company and no legal

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opinion of legal counsel of the pledgee, secured party or pledgor shall be
required in connection therewith. 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 Shares
may reasonably request in connection with a pledge or transfer of the Shares,
including, if the Shares are subject to registration pursuant to the
Registration Rights Agreement, the preparation and filing of any required
prospectus supplement under Rule 424(b)(3) under the Securities Act or other
applicable provision of the Securities Act to appropriately amend the list of
Selling Stockholders thereunder.
          (c) Certificates evidencing the Shares shall not contain any legend
(including the legend set forth in Section 4.1(b)), (i) while a registration
statement (including the Registration Statement) covering the resale of such
security is effective under the Securities Act provided that at the time a
Purchaser requests a removal of the legend on any certificate evidencing all or
any portion of any of the Shares, such Purchaser (or a broker acting on such
Purchaser’s behalf) provides to the Company (or to the transfer agent on the
Company’s behalf), a representation that any of the Shares, sold or to be sold
by such Purchaser have been, or will be, sold in accordance with the plan of
distribution set forth in the Prospectus and in compliance with the prospectus
delivery requirements 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). The Company agrees that
following the Effective Date or at such time as such legend is no longer
required under this Section 4.1(c), 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 issued with a restrictive legend
(such date, the “Legend Removal Date”), 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.
          (d) Each Purchaser, severally and not jointly with the other
Purchasers, agrees that the removal of the restrictive legend from certificates
representing Shares as set forth in this Section 4.1 is predicated upon the
Company’s reliance that the Purchaser will sell any Shares pursuant to either
the registration requirements of the Securities Act, including any applicable
prospectus delivery requirements, or an exemption therefrom.
     4.2 Furnishing of Information. As long as any Purchaser owns Shares, the
Company will use best efforts to timely file (or obtain extensions in respect
thereof and file within the applicable grace period) all reports required to be
filed by the Company after the date hereof pursuant to the Exchange Act. As long
as any Purchaser owns Shares, if the Company is not required to file reports
pursuant to the Exchange Act, it will prepare and furnish to the Purchasers and
make publicly available in accordance with Rule 144(c) such information as is
required for the Purchasers to sell the Shares under Rule 144. The Company
further covenants that it will take such further action as any holder of Shares
may reasonably request, all to the extent required from time to time to enable
such Person to sell such Shares without registration under the Securities Act
within the limitation of the exemptions provided by Rule 144.

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     4.3 Integration. The Company shall not sell, offer for sale or solicit
offers to buy or otherwise negotiate in respect of any security (as defined in
Section 2 of the Securities Act) that would be integrated with the offer or sale
of the Shares in a manner that would require the registration under the
Securities Act of the sale of the Shares to the Purchasers or that would be
integrated with the offer or sale of the Shares for purposes of the rules and
regulations of any Trading Market such that it would require shareholder
approval prior to the closing of such other transaction unless shareholder
approval is obtained before the closing of such subsequent transaction.
     4.4 Publicity. The Company, and each Purchaser shall consult with each
other in issuing any other press releases with respect to the transactions
contemplated hereby, and neither the Company, nor any Purchaser shall issue any
such press release or otherwise make any such public statement without the prior
consent of the Company, with respect to any press release of any Purchaser, or
without the prior consent of each Purchaser, with respect to any press release
of the Company, which consent shall not unreasonably be withheld, except if such
disclosure is required by law, in which case the disclosing party shall promptly
provide the other party with prior notice of such public statement or
communication. Notwithstanding the foregoing, neither the Company shall publicly
disclose the name of any Purchaser, or include the name of any Purchaser in any
filing with the Commission or any regulatory agency or Trading Market, without
the prior written consent of such Purchaser, except (i) as required by federal
securities law and (ii) to the extent such disclosure is required by law or
Trading Market regulations.
     4.5 Reservation of Common Stock. As of the date hereof, each of the Company
has reserved and the Company shall continue to reserve and keep available at all
times, free of preemptive rights, a sufficient number of shares of Common Stock
for the purpose of enabling the Company to issue the Shares pursuant to this
Agreement.
     4.6 Equal Treatment of Purchasers. No consideration shall be offered or
paid to any person to amend or consent to a waiver or modification of any
provision of any of the Transaction Documents unless the same consideration is
also offered to all of the parties to the Transaction Documents. For
clarification purposes, this provision constitutes a separate right granted to
each Purchaser by the Company and negotiated separately by each Purchaser, and
is intended to treat for the Company the Purchasers as a class and shall not in
any way be construed as the Purchasers acting in concert or as a group with
respect to the purchase, disposition or voting of Shares or otherwise.
     4.7 Subsequent Equity Sales. Except for Exempt Issuances, from the date
hereof until the Effective Date, neither the Company nor any Subsidiary shall
issue shares of Common Stock or Common Stock Equivalents.
     4.8 Delivery of Shares After Closing. The Company shall deliver, or cause
to be delivered, the respective Shares purchased by each Purchaser to such
Purchaser within three Trading Days of the Closing Date.
     4.9 Most Favored Nations. If, at any time and from time to time during the
period commencing on the Closing Date and ending on the first anniversary of the
Effective Date, the Company issues additional shares of Common Stock or Common
Stock Equivalents, excluding

13

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any Anti-Dilution Shares (the “Additional Shares”) at a price or exercise price
per share of Common Stock (the “Effective Price”) less than Per Share Purchase
Price (as adjusted hereunder to such date), then the Company shall provide
notice thereof to the Purchasers, and, within twenty business days from receipt
of such notice, the Purchasers or any of them shall have the right to purchase
additional shares of Common Stock (the “Purchase Shares”) at a purchase price
equal to the par value thereof (the “Purchase Share Price”) in accordance with
the following: (a) There shall be calculated a per share price (the “Adjusted
Price”) determined by a fraction, the numerator of which shall be 19,397,020
PLUS the product of the number of Additional Shares multiplied by the Effective
Price PLUS any prior products of previously issued Additional Shares multiplied
by the applicable Effective Price(s) with respect to such issuances, and the
denominator of which shall be 25,862,694 PLUS the number of Additional Shares
PLUS any previously issued Additional Shares. (b) Each Purchaser shall be
entitled to purchase that number of Purchase Shares at the Purchase Price equal
to the difference between the product of the total dollars paid by Purchaser for
shares of common stock hereunder (the “Purchaser Amount”) divided by the
Adjusted Price LESS the product of the Purchaser Amount divided by the Per Share
Purchase Price. By way of example only, if the Company issued 4,000,000
Additional Shares at an Effective Price of $.50 per share, and there had been no
previous adjustments further to this Section 4.9, the Adjusted Price would be
$.7165 (19,397,020 PLUS 2,000,000 divided by 25,862,694 PLUS 4,000,000). If the
Purchaser purchased $1,000,000 of Common Stock further to this Agreement,
he/she/it would be entitled to purchase 62,340 Purchase Shares (1,000,000
divided by .7165 or 1,395,673 shares LESS 1,000,000 divided by .75 or 1,333,333
shares). Notwithstanding the foregoing, no adjustment will be made in respect of
Exempt Issuances.
     4.10 Board Nominee. At each of the next two annual meetings of stockholders
where directors are elected, the Company agrees to place Hunter’s designee on
the slate of directors for nomination to the Board at each such meeting. In
addition, the Company agrees to cause a proposal to be put in front of the Board
for its consideration at its next regular meeting in the month of November 2005
to elect Todd Ficeto to a vacancy presently existing as of the date hereof on
the Board.
ARTICLE V
MISCELLANEOUS
     5.1 Termination. This Agreement may be terminated by any Purchaser, by
written notice to the other parties, if the Closing has not been consummated on
or before December 31, 2005; provided that no such termination will affect the
right of any party to sue for any breach by the other party (or parties).
     5.2 Fees and Expenses. The Company shall deliver, prior to the Closing, a
completed and executed copy of the Closing Statement, attached hereto as Annex
A. Except as otherwise set forth in this Agreement or in the Placement Agent
Agreement, each party shall pay the fees and expenses of its advisers, counsel,
accountants and other experts, if any, and all other expenses incurred by such
party incident to the negotiation, preparation, execution, delivery and
performance of this Agreement. The Company shall pay all stamp and other taxes
and duties levied in connection with the sale of the Shares.

14

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     5.3 Entire Agreement. The Transaction Documents, together with the exhibits
and schedules thereto, contain the entire understanding of the parties with
respect to the subject matter hereof and supersede all prior agreements and
understandings, oral or written, with respect to such matters, which the parties
acknowledge have been merged into such documents, exhibits and schedules.
     5.4 Notices. Any and all notices or other communications or deliveries
required or permitted to be provided hereunder shall be in writing and shall be
deemed given and effective on the earliest of (a) the date of transmission, if
such notice or communication is delivered via facsimile at the facsimile number
set forth on the signature pages attached hereto prior to 6:30 p.m. (New York
City time) on a Trading Day, (b) the next Trading Day after the date of
transmission, if such notice or communication is delivered via facsimile at the
facsimile number set forth on the signature pages attached hereto on a day that
is not a Trading Day or later than 6:30 p.m. (New York City time) on any Trading
Day, (c) the second Trading Day following the date of mailing, if sent by U.S.
nationally recognized overnight courier service, or (d) upon actual receipt by
the party to whom such notice is required to be given. The address for such
notices and communications shall be as set forth on the signature pages attached
hereto.
     5.5 Amendments; Waivers. No provision of this Agreement may be waived or
amended except in a written instrument signed, in the case of an amendment, by
the Company and Purchasers holding at least 66% of the Shares at such time or,
in the case of a waiver, by the party against whom enforcement of any such
waiver is sought. No waiver of any default with respect to any provision,
condition or requirement of this Agreement shall be deemed to be a continuing
waiver in the future or a waiver of any subsequent default or a waiver of any
other provision, condition or requirement hereof, nor shall any delay or
omission of either party to exercise any right hereunder in any manner impair
the exercise of any such right.
     5.6 Construction. The headings herein are for convenience only, do not
constitute a part of this Agreement and shall not be deemed to limit or affect
any of the provisions hereof. The language used in this Agreement will be deemed
to be the language chosen by the parties to express their mutual intent, and no
rules of strict construction will be applied against any party.
     5.7 Successors and Assigns. This Agreement shall be binding upon and inure
to the benefit of the parties and their successors and permitted assigns. The
Company may not assign this Agreement or any rights or obligations hereunder
without the prior written consent of each Purchaser. Any Purchaser may assign
any or all of its rights under this Agreement to any Person to whom such
Purchaser assigns or transfers any Shares, provided such transferee agrees in
writing to be bound, with respect to the transferred Shares, by the provisions
hereof that apply to the “Purchasers”.
     5.8 No Third-Party Beneficiaries. This Agreement is intended for the
benefit of the parties hereto and their respective successors and permitted
assigns and is not for the benefit of, nor may any provision hereof be enforced
by, any other Person.
     5.9 Governing Law. All questions concerning the construction, validity,
enforcement and interpretation of the Transaction Documents shall be governed by
and construed and enforced in accordance with the internal laws of the State of
Delaware, without regard to the

15

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principles of conflicts of law thereof. Each party agrees that all legal
proceedings concerning the interpretations, enforcement and defense of the
transactions contemplated by this Agreement and any other Transaction Documents
(whether brought against a party hereto or its respective affiliates, directors,
officers, shareholders, employees or agents) shall be commenced exclusively in
the state and federal courts sitting in the City of Los Angeles. Each party
hereby irrevocably submits to the exclusive jurisdiction of the state and
federal courts sitting in the City of Los Angeles, for the adjudication of any
dispute hereunder or in connection herewith or with any transaction contemplated
hereby or discussed herein (including with respect to the enforcement of any of
the Transaction Documents), and hereby irrevocably waives, and agrees not to
assert in any suit, action or proceeding, any claim that it is not personally
subject to the jurisdiction of any such court, that such suit, action or
proceeding is improper or inconvenient venue for such proceeding. Each party
hereby irrevocably waives personal service of process and consents to process
being served in any such suit, action or proceeding by mailing a copy thereof
via registered or certified mail or overnight delivery (with evidence of
delivery) to such party at the address in effect for notices to it under this
Agreement and agrees that such service shall constitute good and sufficient
service of process and notice thereof. Nothing contained herein shall be deemed
to limit in any way any right to serve process in any manner permitted by law.
The parties hereby waive all rights to a trial by jury. If either party shall
commence an action or proceeding to enforce any provisions of the Transaction
Documents, then the prevailing party in such action or proceeding shall be
reimbursed by the other party for its attorneys’ fees and other costs and
expenses incurred with the investigation, preparation and prosecution of such
action or proceeding.
     5.10 Survival. The representations and warranties herein shall survive the
Closing and delivery of the Shares for two years from the date hereof.
     5.11 Execution. This Agreement may be executed in two or more counterparts,
all of which when taken together shall be considered one and the same agreement
and shall become effective when counterparts have been signed by each party and
delivered to the other party, it being understood that both parties need not
sign the same counterpart. In the event that any signature is delivered by
facsimile transmission, such signature shall create a valid and binding
obligation of the party executing (or on whose behalf such signature is
executed) with the same force and effect as if such facsimile signature page
were an original thereof.
     5.12 Severability. If any provision of this Agreement is held to be invalid
or unenforceable in any respect, the validity and enforceability of the
remaining terms and provisions of this Agreement shall not in any way be
affected or impaired thereby and the parties will attempt to agree upon a valid
and enforceable provision that is a reasonable substitute therefor, and upon so
agreeing, shall incorporate such substitute provision in this Agreement.
     5.13 Replacement of Shares. If any certificate evidencing any Shares is
mutilated, lost, stolen or destroyed, the Company shall issue or cause to be
issued in exchange and substitution for and upon cancellation thereof, or in
lieu of and substitution therefor, a new certificate, but only upon receipt of
evidence reasonably satisfactory to the Company of such loss, theft or
destruction and customary and reasonable indemnity, if requested. The applicants
for a new certificate under such circumstances shall also pay any reasonable
third-party costs associated with the issuance of such replacement Shares.

16

--------------------------------------------------------------------------------

 

     5.14 Remedies. In addition to being entitled to exercise all rights
provided herein or granted by law, including recovery of damages, each of the
Purchasers and the Company will be entitled to specific performance under the
Transaction Documents. The parties agree that monetary damages may not be
adequate compensation for any loss incurred by reason of any breach of
obligations described in the foregoing sentence and hereby agrees to waive in
any action for specific performance of any such obligation the defense that a
remedy at law would be adequate.
(Signature Pages Follows)
     IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase
Agreement to be duly executed by their respective authorized signatories as of
the date first indicated above.

                  MICROMED CARDIOVASCULAR, INC.    
 
           
 
  By:   /s/ Travis E. Baugh    
 
  Name:   Travis E. Baugh    
 
  Title:   President and Chief Executive Officer    
 
                Address for Notice    
 
                8965 Interchange Drive         Houston TX 77054    

with a copy to (which shall not constitute notice):
Thomas J. Poletti, Esq.
Kirkpatrick & Lockhart Nicholson Graham LLP
10100 Santa Monica Boulevard
Seventh Floor
Los Angeles, CA 90067
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
SIGNATURE PAGES FOR PURCHASERS FOLLOW]

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[PURCHASER SIGNATURE PAGES TO MICROMED CARDIOVASCULAR, INC.
SECURITIES PURCHASE AGREEMENT PURCHASE AGREEMENT]
     IN WITNESS WHEREOF, the undersigned have caused this Common Stock Purchase
Agreement to be duly executed by their respective authorized signatories as of
the date first indicated above.

                  INVESTING ENTITY    
 
                ABSOLUTE RETURN EUROPE FUND    
 
                By: /s/ Florian Homm         Name: Florian Homm    
 
      Title: Investment Advisor    
 
           
 
      Address for Notice of Investing Party:    
 
      c/o Todd Ficeto    
 
      Hunter World Markets, Inc.    
 
      9300 Wilshire Blvd.    
 
      Penthouse Suite    
 
      Beverly Hills, CA 90212    

With a copy to (which shall not constitute notice):
David L. Ficksman
Troy & Gould
1801 Century Park East, 16th Floor
Los Angeles, California 90067
Address for Delivery of Securities for
Investing Entity (if not same as above):

         
Subscription Amount:
  $2,000,000    
Shares:
  2,666,667 shares of Common Stock    
EIN Number:
       
 
     

[SIGNATURE PAGES CONTINUE]

18

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[PURCHASER SIGNATURE PAGES TO MICROMED CARDIOVASCULAR, INC.
SECURITIES PURCHASE AGREEMENT PURCHASE AGREEMENT]
     IN WITNESS WHEREOF, the undersigned have caused this Common Stock Purchase
Agreement to be duly executed by their respective authorized signatories as of
the date first indicated above.

                  INVESTING ENTITY    
 
                EUROPEAN CATALYST FUND    
 
           
 
  By:   /s/ Florian Homm    
 
      Name: Florian Homm    
 
      Title: Investment Advisor    
 
           
 
      Address for Notice of Investing Party:    
 
      c/o Todd Ficeto    
 
      Hunter World Markets, Inc.    
 
      9300 Wilshire Blvd.    
 
      Penthouse Suite    
 
      Beverly Hills, CA 90212    

With a copy to (which shall not constitute notice):
David L. Ficksman
Troy & Gould
1801 Century Park East, 16th Floor
Los Angeles, California 90067
Address for Delivery of Securities for
Investing Entity (if not same as above):

         
Subscription Amount:
  $2,200,000    
Shares:
  2,933,333 shares of Common Stock    
EIN Number:
       
 
     

[SIGNATURE PAGES CONTINUE]

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[PURCHASER SIGNATURE PAGES TO MICROMED CARDIOVASCULAR, INC.
SECURITIES PURCHASE AGREEMENT PURCHASE AGREEMENT]
     IN WITNESS WHEREOF, the undersigned have caused this Common Stock Purchase
Agreement to be duly executed by their respective authorized signatories as of
the date first indicated above.

                  INVESTING ENTITY    
 
                ABSOLUTE OCTANE FUND    
 
           
 
  By:   /s/ Florian Homm    
 
      Name: Florian Homm    
 
      Title: Investment Advisor    
 
           
 
      Address for Notice of Investing Party:    
 
      c/o Todd Ficeto    
 
      Hunter World Markets, Inc.    
 
      9300 Wilshire Blvd.    
 
      Penthouse Suite    
 
      Beverly Hills, CA 90212    

With a copy to (which shall not constitute notice):
David L. Ficksman
Troy & Gould
1801 Century Park East, 16th Floor
Los Angeles, California 90067
Address for Delivery of Securities for
Investing Entity (if not same as above):

         
Subscription Amount:
  $400,000    
Shares:
  533,333 shares of Common Stock    
EIN Number:
       
 
     

[SIGNATURE PAGES CONTINUE]

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[PURCHASER SIGNATURE PAGES TO MICROMED CARDIOVASCULAR, INC.
SECURITIES PURCHASE AGREEMENT PURCHASE AGREEMENT]
     IN WITNESS WHEREOF, the undersigned have caused this Common Stock Purchase
Agreement to be duly executed by their respective authorized signatories as of
the date first indicated above.

                  INVESTING ENTITY    
 
                ABSOLUTE GERMAN FUND    
 
           
 
  By:   /s/ Florian Homm    
 
      Name: Florian Homm    
 
      Title: Investment Advisor    
 
           
 
      Address for Notice of Investing Party:    
 
      c/o Todd Ficeto    
 
      Hunter World Markets, Inc.    
 
      9300 Wilshire Blvd.    
 
      Penthouse Suite    
 
      Beverly Hills, CA 90212    

With a copy to (which shall not constitute notice):
David L. Ficksman
Troy & Gould
1801 Century Park East, 16th Floor
Los Angeles, California 90067
Address for Delivery of Securities for
Investing Entity (if not same as above):

         
Subscription Amount:
  $400,000    
Shares:
  533,333 shares of Common Stock    
EIN Number:
       
 
     

[SIGNATURE PAGES CONTINUE]

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[PURCHASER SIGNATURE PAGES TO MICROMED CARDIOVASCULAR, INC.
SECURITIES PURCHASE AGREEMENT PURCHASE AGREEMENT]
     IN WITNESS WHEREOF, the undersigned have caused this Common Stock Purchase
Agreement to be duly executed by their respective authorized signatories as of
the date first indicated above.

                  INVESTING ENTITY    
 
                THE HUNTER FUND LTD    
 
           
 
  By:   /s/ Todd M. Ficeto    
 
      Name: Todd Ficeto    
 
      Title:   Investment Advisor    
 
           
 
      Email Address: tficeto@hwmarkets.com    
 
           
 
      Address for Notice of Investing Party:    
 
      c/o Todd Ficeto    
 
      Hunter World Markets, Inc.    
 
      9300 Wilshire Blvd.    
 
      Penthouse Suite    
 
      Beverly Hills, CA 90212    

With a copy to (which shall not constitute notice):
David L. Ficksman
Troy & Gould
1801 Century Park East, 16th Floor
Los Angeles, California 90067
Address for Delivery of Securities for
Investing Entity (if not same as above):

         
Subscription Amount:
  $200,000    
Shares:
  150,000 shares of Common Stock    
EIN Number:
       
 
     

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ANNEX A
CLOSING STATEMENT
         Pursuant to the attached Securities Purchase Agreement, dated as of the
date hereto, the purchasers shall purchase up to $5,000,000 of Shares from
MicroMed Cardiovascular, Inc., a Delaware corporation (the “Company”). All funds
will be wired into an escrow account. All funds will be disbursed in accordance
with this Closing Statement.
Disbursement Date: November 29, 2005

                      I.   PURCHASE PRICE        
 
                   
 
          Gross Proceeds to be Received in Trust   $ 5,000,000  
 
                    II.   DISBURSEMENTS        
 
                        Payee:   MicroMed Cardiovascular, Inc.   $ 4,465,000    
      8965 Interchange Drive                 Houston TX 77054                
ABA#: 121140399                 Acct.#: 3300362576      
 
                        Payee:   Hunter World Markets, Inc.   $ 525,000        
  9300 Wilshire Blvd., Ste. Penthouse                 Beverly Hills, CA 90212  
              ABA#: 122000496                 Acct.#: 20601 66768      
 
                        Payee:   Troy & Gould PC   $ 10,000           U.S. Bank
                9595 Wilshire Boulevard                 Beverly Hills,
California 90212                 Troy & Gould Trust Account                
Routing No.: 1-222-35821                 Acct.#.:         164301242180      
 
                   
 
          Total Amount Disbursed:   $ 5,000,000  

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Schedule of Purchasers

                  Purchaser’s Name   Share Amount     Purchase Amount  
Absolute Return Europe
    2,666,667     $ 2,000,000  
European Catalyst Fund
    2,933,333     $ 2,200,000  
Absolute Octane Fund
    533,333     $ 400,000  
Absolute German Fund
    533,333     $ 400,000  
The Hunter Fund Ltd.
    200,000     $ 150,000  
 
               
 
           
TOTAL:
    6,866,666     $ 5,150,000  

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