Document:

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                                                                   EXHIBIT 10.30

                         SECURITIES PURCHASE AGREEMENT

        This SECURITIES PURCHASE AGREEMENT (this "Agreement"), dated as of March
10, 2000 is made by and among Micro Therapeutics, Inc., a Delaware corporation,
with headquarters located at 2 Goodyear, Irvine, California 92618 (the
"Company"), and the investors named on the signature pages hereto, together with
their permitted transferees (the "Investors").

                                    RECITALS:

        A. The Company and the Investors are executing and delivering this
Agreement in reliance upon the exemption from securities registration afforded
by Section 4(2) of the Securities Act and Rule 506 under Regulation D.

        B. The Investors desire, upon the terms and conditions stated in this
Agreement, to purchase shares of the Company's Common Stock, for an aggregate
purchase price of Eleven Million Nine Hundred Thirty-Six Thousand Dollars
($11,936,000). The purchase price per share of the Common Stock is Seven Dollars
and Forty-Six Cents ($7.46).

        C. Contemporaneously with the execution and delivery of this Agreement,
the parties hereto are executing and delivering a Registration Rights Agreement
under which the Company has agreed to provide certain registration rights under
the Securities Act, the rules and regulations promulgated thereunder and
applicable state securities laws.

        D. The capitalized terms used herein and not otherwise defined have the
meanings given them in Article IX hereof.

        In consideration of the premises and the mutual covenants contained
herein and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the Company and the Investors hereby agree as
follows:

                                    ARTICLE I
                         PURCHASE AND SALE OF SECURITIES

        1.1 Purchase and Sale of Securities. At the Closing, subject to the
terms of this Agreement and the satisfaction or waiver of the conditions set
forth in Articles VI and VII hereof, the Company will issue and sell to each
Investor, and each Investor will (on a several and not a joint basis) purchase
from the Company, the number of shares of Common Stock set forth beneath such
Investor's name on the signature pages hereof.

        1.2 Payment. Each Investor will pay the purchase price for the number of
Securities set forth beneath its name on the signature pages hereof, by wire
transfer of immediately available funds in accordance with the Company's written
wire instructions, upon delivery by the Company to each Investor of certificates
representing the Securities so purchased by such Investor and the Company will
deliver such certificates against delivery of the purchase price as described
above.

        1.3 Closing Date. Subject to the satisfaction or waiver of the
conditions set forth in Articles VI and VII hereof, the Closing will take place
at 10 a.m. Pacific Standard Time on March 10, 2000 or at another date or time
agreed upon by the parties to this Agreement (the "Closing

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Date"). The Closing will be held at the offices of Stradling Yocca Carlson &
Rauth or at such other place as the parties agree.

                                   ARTICLE II
                    INVESTOR'S REPRESENTATIONS AND WARRANTIES

        Each Investor represents and warrants to the Company, severally and
solely with respect to itself and its purchase hereunder and not with respect to
any other Investor, that:

        2.1 Investment Purpose. The Investor is purchasing the Securities for
its own account and not with a present view toward the public sale or
distribution thereof, except pursuant to sales registered or exempted from
registration under the Securities Act; provided, however, that by making the
representation herein, the Investor does not agree to hold any of the Securities
for any minimum or other specific term and reserves the right to dispose of the
Securities at any time in accordance with or pursuant to a registration
statement or an exemption under the Securities Act.

        2.2 Accredited Investor Status. The Investor is an "accredited investor"
as defined in Rule 501(a) of Regulation D. The Investor has delivered an
Investor Questionnaire in the form of Exhibit A to the Company and to U.S.
Bancorp Piper Jaffray Inc.

        2.3 Reliance on Exemptions. The Investor understands that the Securities
are being offered and sold to it in reliance upon specific exemptions from the
registration requirements of United States federal and state securities laws and
that the Company is relying upon the truth and accuracy of, and the Investor's
compliance with, the representations, warranties, agreements, acknowledgments
and understandings of the Investor set forth herein in order to determine the
availability of such exemptions and the eligibility of the Investor to acquire
the Securities.

        2.4 Information. The Investor and its advisors, if any, have been
furnished with all materials relating to the business, finances and operations
of the Company, and materials relating to the offer and sale of the Securities,
that have been requested by the Investor or its advisors, if any. The Investor
and its advisors, if any, have been afforded the opportunity to ask questions of
the Company. Neither such inquiries nor any other due diligence investigation
conducted by Investor or any of its advisors or representatives modify, amend or
affect the Investor's right to rely on the Company's representations and
warranties contained in Article III below. The Investor acknowledges and
understands that its investment in the Securities involves a significant degree
of risk, including the risks reflected in the SEC Documents.

        2.5 Governmental Review. The Investor understands that no United States
federal or state agency or any other government or governmental agency has
passed upon or made any recommendation or endorsement of the Securities or an
investment therein.

        2.6 Transfer or Resale. The Investor understands that:

                (a) except as provided in the Registration Rights Agreement, the
Securities have not been and are not being registered under the Securities Act
or any applicable state securities laws and, consequently, the Investor may have
to bear the risk of owning the Securities for an indefinite period of time
because the Securities may not be transferred unless (i) the resale of the
Securities is registered pursuant to an effective registration statement under
the Securities Act; (ii) the Investor has delivered to the Company an opinion of
counsel (in form, substance and scope customary for

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opinions of counsel in comparable transactions) to the effect that the
Securities to be sold or transferred may be sold or transferred pursuant to an
exemption from such registration; (iii) the Securities are sold or transferred
pursuant to Rule 144 or (iv) the Securities are sold or transferred to an
affiliate (as defined in Rule 144) of the Investor;

                (b) any sale of the Securities made in reliance on Rule 144 may
be made only in accordance with the terms of Rule 144 and, if Rule 144 is not
applicable, any resale of the Securities under circumstances in which the seller
(or the person through whom the sale is made) may be deemed to be an underwriter
(as that term is defined in the Securities Act) may require compliance with some
other exemption under the Securities Act or the rules and regulations of the SEC
thereunder; and

                (c) except as set forth in the Registration Rights Agreement,
neither the Company nor any other person is under any obligation to register the
Securities under the Securities Act or any state securities laws or to comply
with the terms and conditions of any exemption thereunder.

        2.7 Legends. The Investor understands that until (a) the Securities may
be sold by the Investor under Rule 144(k) or (b) such time as the resale of the
Securities have been registered under the Securities Act as contemplated by the
Registration Rights Agreement, the certificates representing the Securities will
bear a restrictive legend in substantially the following form (and a
stop-transfer order may be placed against transfer of the certificates for such
Securities):

        THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY
STATE OF THE UNITED STATES. THE SECURITIES MAY NOT BE SOLD, TRANSFERRED OR
ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE
SECURITIES UNDER APPLICABLE SECURITIES LAWS, OR UNLESS OFFERED, SOLD OR
TRANSFERRED PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THOSE LAWS.

        The legend set forth above will be removed and the Company will issue a
certificate without the legend to the holder of any certificate upon which it is
stamped, in accordance with the terms of Article V hereof.

        2.8 Authorization; Enforcement. This Agreement and the Registration
Rights Agreement have been duly and validly authorized, executed and delivered
on behalf of the Investor and are valid and binding agreements of the Investor
enforceable in accordance with their terms, subject to the effect of any
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the rights of creditors generally and the application of general
principles of equity.

        2.9 Residency. The Investor is a resident of the jurisdiction set forth
immediately below such Investor's name on the signature pages hereto.

        2.10 Acknowledgements Regarding Placement Agent. Purchaser acknowledges
that U.S. Bancorp Piper Jaffray Inc. is acting as placement agent (the
"Placement Agent") for the Securities being offered hereby and will be
compensated by the Company for acting in such capacity. Purchaser further
acknowledge that the Placement Agent has acted solely as placement agent in
connection with the offering of the Securities by the Company, that the
information and data

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provided to Purchaser in connection with the transactions contemplated hereby
have not been subjected to independent verification by the Placement Agent, and
that the Placement Agent makes no representation or warranty with respect to the
accuracy or completeness of such information, data or other related disclosure
material. Purchaser further acknowledges that in making its decision to enter
into this Agreement and purchase the Securities it has relied on its own
examination of the Company and the terms of, and consequences, of holding the
Securities. Purchaser further acknowledges that the provisions of this Section
2.10 are for the benefit of, and may be enforced by, the Placement Agent.

                                   ARTICLE III
                  REPRESENTATIONS AND WARRANTIES OF THE COMPANY

        The Company represents and warrants to the Investors that:

        3.1 Organization and Qualification. The Company is duly incorporated,
validly existing and in good standing under the laws of the jurisdiction in
which it is incorporated, with full power and authority (corporate and other) to
own, lease, use and operate its properties and to carry on its business as and
where now owned, leased, used, operated and conducted. The Company is duly
qualified to do business and is in good standing in every jurisdiction in which
the nature of the business conducted by it makes such qualification necessary,
except where the failure to be so qualified or in good standing would not have a
Material Adverse Effect.

        3.2 Authorization; Enforcement. (a) The Company has all requisite
corporate power and authority to enter into and to perform its obligations under
this Agreement and the Registration Rights Agreement, to consummate the
transactions contemplated hereby and thereby and to issue the Securities in
accordance with the terms hereof and thereof; (b) the execution, delivery and
performance of this Agreement and the Registration Rights Agreement by the
Company and the consummation by it of the transactions contemplated hereby and
thereby (including without limitation the issuance of the Securities) have been
duly authorized by the Company's Board of Directors and no further consent or
authorization of the Company, its Board or Directors, or its shareholders is
required; (c) this Agreement and the Registration Rights Agreement have been
duly executed by the Company; and (d) each of this Agreement and the
Registration Rights Agreement constitutes a legal, valid and binding obligation
of the Company enforceable against the Company in accordance with its terms,
subject to the effect of any applicable bankruptcy, insolvency, reorganization,
or moratorium or similar laws affecting the rights of creditors generally and
the application of general principles of equity.

        3.3 Capitalization. As of the date hereof, the authorized capital stock
of the Company consists of (a) 20,000,000 shares of Common Stock, par value
$.001 per share, of which 8,272,634 shares are issued and outstanding, 2,850,000
shares are reserved for issuance under the Company's employee and director stock
option plans, 200,000 are reserved for issuance pursuant to the Company's
employee stock purchase plan, and 810,164 shares are reserved for issuance
pursuant to securities (other than securities issued under the foregoing plans)
exercisable for, or convertible into or exchangeable for shares of Common Stock;
(b) 5,000,000 shares of preferred stock, par value $.001 per share, none of
which shares are designated and none are issued and outstanding. All of such
outstanding shares of capital stock are, or upon issuance will be, duly
authorized, validly issued, fully paid and nonassessable. No shares of capital
stock of the Company, including the Securities issuable pursuant to this
Agreement, are subject to preemptive rights or any other similar rights of the
stockholders of the Company or any liens or encumbrances imposed through the
actions or failure to

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act of the Company. Except as disclosed in Schedule 3.3 and except for the
transactions contemplated hereby, (i) there are no outstanding options,
warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal,
agreements, understandings, claims or other commitments or rights of any
character whatsoever relating to, or securities or rights convertible into,
exercisable for, or exchangeable for any shares of capital stock of the Company,
or arrangements by which the Company is or may become bound to issue additional
shares of capital stock of the Company; (ii) there are no agreements or
arrangements (other than the Registration Rights Agreement) under which the
Company is obligated to register the sale of any of its securities under the
Securities Act and (iii) there are no anti-dilution or price adjustment
provisions contained in any security issued by the Company (or in any agreement
providing rights to security holders) that will be triggered by the issuance of
the Securities. The Company has furnished to the Investors true and correct
copies of the Company's Certificate of Incorporation, as amended, as in effect
on the date hereof, the Company's By-laws as in effect on the date hereof and
the terms of all securities convertible into or exercisable for Common Stock of
the Company and the material rights of the holders thereof in respect thereto.

        3.4 Issuance of Securities. The Securities are duly authorized and, upon
issuance in accordance with the terms of this Agreement, will be validly issued,
fully paid and non-assessable, free from all taxes, liens, claims, encumbrances
and charges with respect to the issue thereof, will not be subject to preemptive
rights or other similar rights of stockholders of the Company, and will not
impose personal liability on the holders thereof.

        3.5 No Conflicts; No Violation.

                (a) The execution, delivery and performance of this Agreement
and the Registration Rights Agreement by the Company and the consummation by the
Company of the transactions contemplated hereby and thereby (including, without
limitation, the issuance of the Securities) will not (i) conflict with or result
in a violation of any provision of the Certificate of Incorporation or By-laws
or (ii) violate or conflict with, or result in a breach of any provision of, or
constitute a default (or an event which with notice or lapse of time or both
could become a default) under, or give to others any rights of termination,
amendment (including without limitation, the triggering of any anti-dilution
provision), acceleration or cancellation of, any agreement, indenture, patent,
patent license, or instrument to which the Company is a party, or (iii) result
in a violation of any law, rule, regulation, order, judgment or decree
(including U.S. federal and state securities laws and regulations and
regulations of any self-regulatory organizations to which the Company or its
securities are subject) applicable to the Company or by which any property or
asset of the Company is bound or affected (except for such conflicts, breaches,
defaults, terminations, amendments, accelerations, cancellations and violations
as would not, individually or in the aggregate, have a Material Adverse Effect).

                (b) The Company is not in violation of its Certificate of
Incorporation, By-laws or other organizational documents and the Company is not
in default (and no event has occurred which with notice or lapse of time or both
could put the Company in default) under any agreement, indenture or instrument
to which the Company is a party or by which any property or assets of the
Company is bound or affected, except for possible defaults as would not,
individually or in the aggregate, have a Material Adverse Effect.

                (c) The Company is not conducting its business in violation of
any law, ordinance or regulation of any governmental entity, the failure to
comply with which would, individually or in the aggregate, have a Material
Adverse Effect.

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                (d) Except as specifically contemplated by this Agreement and as
required under the Securities Act and any applicable state securities laws or
any listing agreement with any securities exchange or automated quotation
system, the Company is not required to obtain any consent, authorization or
order of, or make any filing or registration with, any court or governmental
agency or any regulatory or self regulatory agency in order for it to execute,
deliver or perform any of its obligations under this Agreement or the
Registration Rights Agreement, in each case in accordance with the terms hereof
or thereof, or to issue and sell the Securities in accordance with the terms
hereof. Except as set forth in Schedule 3.5, all consents, authorizations,
orders, filings and registrations which the Company is required to obtain
pursuant to the preceding sentence have been obtained or effected on or prior to
the date hereof. The Company is not in violation of the listing requirements of
Nasdaq.

        3.6 SEC Documents, Financial Statements. Since December 31, 1998, the
Company has timely filed all reports, schedules, forms, statements and other
documents required to be filed by it with the SEC pursuant to the reporting
requirements of the Exchange Act (all of the foregoing filed prior to the date
hereof and all exhibits included therein and financial statements and schedules
thereto and documents (other than exhibits) incorporated by reference therein,
being hereinafter referred to herein as the "SEC Documents"). The Company has
delivered to each Investor, or each Investor has had access to, true and
complete copies of the SEC Documents, except for such exhibits and incorporated
documents. As of their respective dates, the SEC Documents complied in all
material respects with the requirements of the Exchange Act or the Securities
Act, as the case may be, and the rules and regulations of the SEC promulgated
thereunder applicable to the SEC Documents, and none of the SEC Documents, at
the time they were filed with the SEC, contained any untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading. As of their respective
dates, the financial statements of the Company included in the SEC Documents
complied as to form in all material respects with applicable accounting
requirements and the published rules and regulations of the SEC with respect
thereto. Such financial statements have been prepared in accordance with U.S.
generally accepted accounting principles, consistently applied, during the
periods involved (except (i) as may be otherwise indicated in such financial
statements or the notes thereto, or (ii) in the case of unaudited interim
statements, to the extent they may not include footnotes or may be condensed or
summary statements) and fairly present in all material respects the financial
position of the Company as of the dates thereof and the results of its
operations and cash flows for the periods then ended (subject, in the case of
unaudited statements, to normal year-end audit adjustments). Except as set forth
in the financial statements included in the SEC Documents, the Company has no
liabilities, contingent or otherwise, other than liabilities incurred in the
ordinary course of business subsequent to September 30, 1999, and liabilities of
the type not required under generally accepted accounting principles to be
reflected in such financial statements. Such liabilities incurred subsequent to
September 30, 1999, are not, in the aggregate, material to the financial
condition or operating results of the Company.

        3.7 Absence of Certain Changes. Except as disclosed in the SEC
Documents, since December 31, 1998, there has been no material adverse change in
the assets, liabilities, business, properties, operations, financial condition,
prospects or results of operations of the Company.

        3.8 Absence of Litigation. There is no action, suit, claim, proceeding,
inquiry or investigation before or by any court, public board, government
agency, self-regulatory organization or body pending or, to the knowledge of the
Company, threatened against or affecting the Company

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or any of its officers or directors acting as such that could, individually or
in the aggregate, have a Material Adverse Effect.

        3.9 Intellectual Property Rights. The Company owns or possesses the
licenses or rights to use all patents, patent applications, patent rights,
inventions, know-how, trade secrets, trademarks, trademark applications, service
marks, service names, trade names and copyrights necessary to enable it to
conduct its business as now operated or as currently proposed to be operated
(the "Intellectual Property"). Except as set forth in the SEC Documents (as
defined in Section 3.6 hereof), there are no material outstanding options,
licenses or agreements relating to the Intellectual Property, nor is the Company
bound by or a party to any material options, licenses or agreements relating to
the patents, patent applications, patent rights, inventions, know-how, trade
secrets, trademarks, trademark applications, service marks, service names, trade
names or copyrights of any other person or entity. There is no claim or action
or proceeding pending or, to the Company's knowledge, threatened that challenges
the right of the Company with respect to any Intellectual Property.

        3.10 Tax Status. Except as set forth on Schedule 3.10, the Company has
timely made or filed all federal, state and foreign income and all other tax
returns, reports and declarations required by any jurisdiction to which it is
subject (unless and only to the extent that the Company has set aside on its
books provisions reasonably adequate for the payment of all unpaid and
unreported taxes) and has timely paid all taxes and other governmental
assessments and charges that are material in amount, shown or determined to be
due on such returns, reports and declarations, except those being contested in
good faith, and has set aside on its books provisions reasonably adequate for
the payment of all taxes for periods subsequent to the periods to which such
returns, reports or declarations apply. To the knowledge of the Company, there
are no unpaid taxes in any material amount claimed to be due by the taxing
authority of any jurisdiction, and the officers of the Company know of no basis
for any such claim. The Company has not executed a waiver with respect to the
statute of limitations relating to the assessment or collection of any foreign,
federal, state or local tax. Except as set forth on Schedule 3.10, none of the
Company's tax returns is presently being audited by any taxing authority.

        3.11 Environmental Laws. The Company (i) is in compliance with all
applicable foreign federal, state and local laws and regulations relating to the
protection of human health and safety, the environment or hazardous or toxic
substances or wastes, pollutants or contaminants ("Environmental Laws"), (ii)
has received all permits, licenses or other approvals required of them under
applicable Environmental Laws to conduct its business and (iii) is in compliance
with all terms and conditions of any such permit, license or approval where, in
each of the three foregoing clauses, the failure to so comply would have,
individually or in the aggregate, a Material Adverse Effect

        3.12 No Integrated Offering. Neither the Company, nor any of its
affiliates, nor any person acting on its or their behalf, has directly or
indirectly made any offers or sales in any security or solicited any offers to
buy any security under circumstances that would require registration under the
Securities Act of the issuance of the Securities to the Investors. The issuance
of the Securities to the Investors will not be integrated with any other
issuance of the Company's securities (past, current or future) for purposes of
the Securities Act or any applicable rules of Nasdaq.

        3.13 No Brokers. The Company has taken no action which would give rise
to any claim by any person for brokerage commissions, finder's fees or similar
payments relating to this

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Agreement or the transactions contemplated hereby, except for dealings with U.S.
Bancorp Piper Jaffray Inc., whose commissions and fees will be paid for by the
Company.

        3.14 Insurance. The Company is insured by insurers of recognized
financial responsibility against such losses and risks and in such amounts as
management of the Company believes to be prudent and customary in the businesses
in which the Company is engaged.

        3.15 Employment Matters. The Company is in compliance with all federal,
state, local and foreign laws and regulations respecting employment and
employment practices, terms and conditions of employment and wages and hours
except where failure to be in compliance would not have a Material Adverse
Effect. The Company is not bound by or subject to (and none of its assets or
properties is bound by or subject to) any written or oral, express or implied,
contract, commitment or arrangement with any labor union, and no labor union has
requested or, to the Company's knowledge, has sought to represent any of the
employees, representatives or agents of the Company. There is no strike or other
labor dispute involving the Company pending, or to the Company's knowledge,
threatened, that could have a Material Adverse Effect nor is the Company aware
of any labor organization activity involving its employees. The Company is not
aware that any officer or key employee, or that any group of officers or key
employees, intends to terminate their employment with the Company, nor does the
Company have a present intention to terminate the employment of any of the
foregoing.

        3.16 Employee Benefit Plans. Except as set forth in the SEC Documents
(as defined in Section 3.6 hereof), the Company does not have any Employee
Benefit Plans, as such term is defined in the Employee Retirement Security Act
of 1974.

        3.17 Investment Company Status. The Company is not and upon consummation
of the sale of the Securities will not be an "investment company," a company
controlled by an "investment company" or an "affiliated person" of, or
"promoter" or "principal underwriter" for, an "investment company" as such terms
are defined in the Investment Company Act of 1940, as amended.

        3.18 Subsidiaries. Except as set forth in the SEC Documents (as defined
in Section 3.6 hereof), the Company does not presently own or control, directly
or indirectly, any interest in any other corporation, association, joint
venture, partnership or other business entity and the Company is not a direct or
indirect participant in any joint venture or partnership.

        3.19 No Conflict of Interest. The Company is not indebted, directly or
indirectly, to any of its officers or directors or to their respective spouses
or children, in any amount whatsoever other than in connection with expenses or
advances of expenses incurred in the ordinary course of business or relocation
expenses of employees. None of the Company's officers, directors or employees,
or any members of their immediate families, are directly, or indirectly,
indebted to the Company (other than in connection with purchases of the
Company's stock or as set forth on Schedule 3.19) or, to the best of the
Company's knowledge, have any direct or indirect ownership interest in any
entity with which the Company is affiliated or with which the Company has a
business relationship, or any entity which competes with the Company except that
officers, directors, employees and/or stockholders of the Company may own stock
in (but not exceeding five percent (5%) of the outstanding capital stock of) any
publicly traded company that may compete with the Company. To the best of the
Company's knowledge, none of the Company's officers, directors or employees or
any members of their immediate families are, directly or indirectly, interested
in any material contract with the Company. The Company is not a guarantor or
indemnitor of any indebtedness of any other person or entity.

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                                   ARTICLE IV
                                    COVENANTS

        4.1 Best Efforts. Each party will use its best efforts to satisfy in a
timely fashion each of the conditions to be satisfied by it under Articles VI
and VII of this Agreement.

        4.2 Form D; Blue Sky Laws. The Company will timely file a Notice of Sale
of Securities on Form D with respect to the Securities, as required under
Regulation D, and to provide a copy thereof to each Investor promptly after such
filing. The Company will, on or before the Closing Date, take such action as it
reasonably determines to be necessary to qualify the Securities for sale to the
Investors under this Agreement under applicable securities (or "blue sky") laws
of the states of the United States (or to obtain an exemption from such
qualification), and will provide evidence of any such action so taken to the
Investors on or prior to the date of the Closing. The Company will file with the
SEC a Current Report on Form 8-K disclosing this Agreement and the transactions
contemplated hereby within 10 business days after the Closing Date.

        4.3 Reporting Status; Eligibility to Use Form S-3. The Company's Common
Stock is registered under Section 12 of the Exchange Act. Throughout the
Registration Period (as defined in the Registration Rights Agreement), the
Company will timely file all reports, schedules, forms, statements and other
documents required to be filed by it with the SEC under the reporting
requirements of the Exchange Act, and the Company will not terminate its status
as an issuer required to file reports under the Exchange Act even if the
Exchange Act or the rules and regulations thereunder would permit such
termination. The Company currently meets, and will take all reasonably necessary
action to continue to meet, the "registrant eligibility" requirements set forth
in the general instructions to Form S-3 to enable the registration of the
Registrable Securities as defined in the Registration Rights Agreement.

        4.4 Expenses. The Company and each Investor is liable for, and will pay,
its own expenses incurred in connection with the negotiation, preparation,
execution and delivery of this Agreement and the other agreements to be executed
in connection herewith, including, without limitation, attorneys' and
consultants' fees and expenses.

        4.5 Financial Information. The financial statements of the Company will
be prepared in accordance with United States generally accepted accounting
principles, consistently applied, and will fairly present in all material
respects the consolidated financial position of the Company and results of its
operations and cash flows as of, and for the periods covered by, such financial
statements (subject, in the case of unaudited statements, to normal year-end
audit adjustments).

        4.6 Listing. On or before the tenth business day after the date of this
Agreement, the Company will secure the listing of the Securities upon each
national securities exchange or automated quotation system, if any, upon which
shares of Common Stock are then listed (subject to official notice of issuance)
and, so long as any Investor owns any of the Securities, will maintain such
listing of the Securities. The Company will use its best efforts to obtain and,
so long as any Investor owns any of the Securities, maintain the listing and
trading of its Common Stock on Nasdaq, the American Stock Exchange or the New
York Stock Exchange and will comply in all respects with the Company's
reporting, filing and other obligations under the bylaws or rules of the
National Association of Securities Dealers, Inc. and such exchanges, as
applicable. Until an Investor transfers, assigns or sells all of the Securities
owned by it, the Company will promptly provide to each Investor copies of any
notices it receives regarding the continued eligibility of the Common Stock for
listing

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on Nasdaq or other principal exchange or quotation system on which the Common
Stock is listed or traded.

        4.7 Compliance with Law. As long as an Investor owns any of the
Securities, the Company will conduct its business in compliance with all
applicable laws, rules and regulations of the jurisdictions in which it is
conducting business, including, without limitation, all applicable local, state
and federal environmental laws and regulations, the failure to comply with which
would have a Material Adverse Effect.

        4.8 No Integration. The Company will not make any offers or sales of any
security (other than the Securities) under circumstances that would cause the
offering of the Securities to be integrated with any other offering of
securities by the Company (i) for the purpose of any stockholder approval
provision applicable to the Company or its securities or (ii) for purposes of
any registration requirement under the Securities Act.

        4.9 Sales by Investors. Each Investor will sell any Securities sold by
it in compliance with applicable prospectus delivery requirements, if any, or
otherwise in compliance with the requirements for an exemption from registration
under the Securities Act and the rules and regulations promulgated thereunder.
No Investor will make any sale, transfer or other disposition of the Securities
in violation of federal or state securities laws.

                                    ARTICLE V
                 TRANSFER AGENT INSTRUCTIONS; REMOVAL OF LEGENDS

        5.1 Issuance of Certificates. The Company will instruct its transfer
agent to issue certificates, registered in the name of each Investor or its
nominee, for the Securities. All such certificates will bear the restrictive
legend described in Section 2.7, except as otherwise specified in this Article
V. In addition, the Company will issue irrevocable Transfer Agent Instructions
to the transfer agent in the form of Exhibit B hereto. The Company will not give
to its transfer agent any instruction other than as described in this Article V
and stop transfer instructions to give effect to Section 2.7 hereof (prior to
registration of the Securities under the Securities Act). Nothing in this
Section will affect in any way the Investor's obligations and agreement set
forth in Section 2.7 hereof to comply with all applicable prospectus delivery
requirements, if any, upon resale of the Securities.

        5.2 Unrestricted Securities. If, unless otherwise required by applicable
state securities laws, (a) the Securities represented by a certificate have been
registered under an effective registration statement filed under the Securities
Act, (b) a holder of Securities provides the Company and the Transfer Agent with
an opinion of counsel, in form, substance and scope customary for opinions of
counsel in comparable transactions, to the effect that a public sale or transfer
of such Securities may be made without registration under the Securities Act and
such sale either has occurred or may occur without restriction on the manner of
such sale or transfer, (c) such holder provides the Company and the Transfer
Agent with reasonable assurances that such Securities can be sold under Rule
144, or (d) the Securities represented by a certificate can be sold without
restriction as to the number of securities sold under Rule 144(k), the Company
will permit the transfer of the Securities, and the Transfer Agent will issue
one or more certificates, free from any restrictive legend, in such name and in
such denominations as specified by such holder. Notwithstanding anything herein
to the contrary, the Securities may be pledged as collateral in connection with
a bona fide margin account or other lending arrangement; provided that such
pledge will not alter the provisions of this Article V with respect to the
removal of restrictive legends.

                                       10
<PAGE>   11

        5.3 Enforcement of Provision. The Company acknowledges that a breach by
it of its obligations hereunder will cause irreparable harm to the Investor by
vitiating the intent and purpose of the transaction contemplated hereby.
Accordingly, the Company acknowledges that the remedy at law for a breach of its
obligations under this Article V will be inadequate and agrees, in the event of
a breach or threatened breach by the Company of the provisions of this Section,
that the Investor will be entitled, in addition to all other available remedies,
to an injunction restraining any breach and requiring immediate transfer,
without the necessity of showing economic loss and without any bond or other
security being required.

                                   ARTICLE VI
                 CONDITIONS TO THE COMPANY'S OBLIGATION TO SELL

        The obligation of the Company to issue and sell the Securities to each
Investor at the Closing is subject to the satisfaction by such Investor, on or
before the Closing Date, of each of the following conditions. These conditions
are for the Company's sole benefit and may be waived by the Company at any time
in its sole discretion:

        6.1 The Investor will have executed this Agreement and the Registration
Rights Agreement and will have delivered those agreements to the Company.

        6.2 The Investor will have delivered the purchase price for the
Securities to the Company in accordance with this Agreement.

        6.3 The representations and warranties of the Investor must be true and
correct in all material respects as of the Closing Date as though made at that
time (except for representations and warranties that speak as of a specific
date, which representations and warranties must be correct as of such date), and
the Investor will have performed and complied in all material respects with the
covenants and conditions required by this Agreement to be performed or complied
with by the Investor at or prior to the Closing.

        6.4 No statute, rule, regulation, executive order, decree, ruling or
injunction will have been enacted, entered, promulgated or endorsed by or in any
court or governmental authority of competent jurisdiction or any self-regulatory
organization having authority over the matters contemplated hereby which
prohibits the consummation of any of the transactions contemplated by this
Agreement.

                                   ARTICLE VII
               CONDITIONS TO THE INVESTOR'S OBLIGATION TO PURCHASE

        The obligation of each Investor hereunder to purchase the Securities
from the Company at the Closing is subject to the satisfaction, on or before the
Closing Date, of each of the following conditions. These conditions are for each
Investor's respective benefit and may be waived by any Investor at any time in
its sole discretion:

        7.1 The Company will have executed this Agreement and the Registration
Rights Agreement and will have delivered those Agreements to the Investor.

        7.2 The Company will have delivered to the Investors duly executed
certificates representing the Securities in the amounts specified in Section 1.1
hereof.

                                       11
<PAGE>   12

        7.3 The representations and warranties of the Company must be true and
correct in all material respects as of the Closing as though made at that time
(except for representations and warranties that speak as of a specific date,
which representations and warranties must be true and correct as of such date)
and the Company must have performed and complied in all material respects with
the covenants and conditions required by this Agreement to be performed or
complied with by the Company at or prior to the Closing. The Investor must have
received a certificate or certificates dated as of the Closing Date and executed
by the Chief Executive Officer or the Chief Financial Officer of the Company
certifying as to the matters in contained in this Section 7.3 and as to such
other matters as may be reasonably requested by such Investor, including, but
not limited to, the Company's Certificate of Incorporation, By-laws, Board of
Directors' resolutions relating to the transactions contemplated hereby and the
incumbency and signatures of each of the officers of the Company who may execute
on behalf of the Company any document delivered at the Closing.

        7.4 No litigation, statute, rule, regulation, executive order, decree,
ruling or injunction will have been enacted, entered, promulgated or endorsed by
or in any court or governmental authority of competent jurisdiction or any
self-regulatory organization having authority over the matters contemplated
hereby which prohibits the consummation of any of the transactions contemplated
by this Agreement.

        7.5 Trading and listing of the Common Stock on Nasdaq must not have been
suspended by the SEC or Nasdaq.

        7.6 The Investors will have received an opinion of the Company's
counsel, dated as of the Closing Date, in form, scope and substance reasonably
satisfactory to the Investors and in substantially the form attached hereto as
Exhibit C.

        7.7 The Irrevocable Transfer Agent Instructions, in form and substance
satisfactory to the Investors, will have been delivered to the Company's
transfer agent and acknowledged in writing by such transfer agent.

                                  ARTICLE VIII
                                 INDEMNIFICATION

        In consideration of each Investor's execution and delivery of this
Agreement and its acquisition of the Securities hereunder, and in addition to
all of the Company's other obligations under this Agreement and the Registration
Rights Agreement, the Company will defend, protect, indemnify and hold harmless
each Investor and each other holder of the Securities and all of their
stockholders, officers, directors, employees and direct or indirect investors
and any of the foregoing person's agents or other representatives (including,
without limitation, those retained in connection with the transactions
contemplated by this Agreement) (collectively, the "Indemnitees") from and
against any and all actions, causes of action, suits, claims, losses, costs,
penalties, fees, liabilities and damages, and expenses in connection therewith
(regardless of whether any such Indemnitee is a party to the action for which
indemnification hereunder is sought), and including reasonable attorneys' fees
and disbursements (the "Indemnified Liabilities"), incurred by an Indemnitee as
a result of, or arising out of, or relating to (a) any breach of any
representation or warranty made by the Company herein or in any other
certificate, instrument or document contemplated hereby or thereby, (b) any
breach of any covenant, agreement or obligation of the Company contained herein
or in any other certificate, instrument or document contemplated hereby or
thereby or (c) any cause of action, suit or claim brought or made against such
Indemnitee and arising out of or resulting from the execution, delivery,

                                       12
<PAGE>   13

performance, breach or enforcement of this Agreement or the Registration Rights
Agreement by the Company. To the extent that the foregoing undertaking by the
Company is unenforceable for any reason, the Company will make the maximum
contribution to the payment and satisfaction of each of the Indemnified
Liabilities that is permissible under applicable law.

                                   ARTICLE IX
                                   DEFINITIONS

        9.1 "Closing" means the closing of the purchase and sale of the
Securities under this Agreement.

        9.2 "Closing Date" has the meaning set forth in Section 1.3.

        9.3 "Common Stock" means the common stock, par value $.001 per share, of
the Company.

        9.4 "Company" means Micro Therapeutics, Inc.

        9.5 "Exchange Act" means the Securities Exchange Act of 1934, as
amended.

        9.6 "Indemnified Liabilities" has the meaning set forth in Article VIII.

        9.7 "Indemnitees" has the meaning set forth in Article VIII.

        9.8 "Investors" means the investors whose names are set forth on the
signature pages of this Agreement, and their permitted transferees.

        9.9 "Material Adverse Effect" means a material adverse effect on (a) the
business, operations, prospects, assets or financial condition of the Company or
(b) the ability of the Company to perform its obligations pursuant to the
transactions contemplated by this Agreement or under the agreements or
instruments to be entered into or filed in connection herewith.

        9.10 "Nasdaq" means the Nasdaq National Market System.

        9.11 "Registration Rights Agreement" means the Registration Rights
Agreement, dated as of the date of this Agreement and among the parties to this
Agreement, in the form attached hereto as Exhibit D.

        9.12 "Regulation D" means Regulation D as promulgated under by the SEC
under the Securities Act.

        9.13 "Rule 144" and "Rule 144(k)" mean Rule 144 and Rule 144(k),
respectively, promulgated under the Securities Act, or any successor rule.

        9.14 "SEC" means the United States Securities and Exchange Commission.

        9.15 "SEC Documents" has the meaning set forth in Section 3.6.

        9.16 "Securities" means the Common Stock sold pursuant to this
agreement.

                                       13
<PAGE>   14

        9.17 "Securities Act" means the Securities Act of 1933, as amended, and
the rules and regulations thereunder, or any similar successor statute.

                                    ARTICLE X
                          GOVERNING LAW; MISCELLANEOUS

        10.1 Governing Law; Jurisdiction. This Agreement will be governed by and
interpreted in accordance with the laws of the State of Delaware without regard
to the principles of conflict of laws. The parties hereto hereby submit to the
exclusive jurisdiction of the United States federal and state courts located in
the State of Delaware with respect to any dispute arising under this Agreement,
the agreements entered into in connection herewith or the transactions
contemplated hereby or thereby.

        10.2 Counterparts; Signatures by Facsimile. This Agreement may be
executed in two or more counterparts, all of which are considered one and the
same agreement and will become effective when counterparts have been signed by
each party and delivered to the other parties. This Agreement, once executed by
a party, may be delivered to the other parties hereto by facsimile transmission
of a copy of this Agreement bearing the signature of the party so delivering
this Agreement.

        10.3 Headings. The headings of this Agreement are for convenience of
reference only, are not part of this Agreement and do not affect its
interpretation.

        10.4 Severability. If any provision of this Agreement is invalid or
unenforceable under any applicable statute or rule of law, then such provision
will be deemed modified in order to conform with such statute or rule of law.
Any provision hereof that may prove invalid or unenforceable under any law will
not affect the validity or enforceability of any other provision hereof.

        10.5 Entire Agreement; Amendments. This Agreement and the Registration
Rights Agreement (including all schedules and exhibits thereto) constitute the
entire agreement among the parties hereto with respect to the subject matter
hereof and thereof. There are no restrictions, promises, warranties or
undertakings, other than those set forth or referred to herein or therein. This
Agreement supersedes all prior agreements and understandings among the parties
hereto with respect to the subject matter hereof. No provision of this Agreement
may be waived or amended other than by an instrument in writing signed by the
party to be charged with enforcement.

        10.6 Notices. Any notices required or permitted to be given under the
terms of this Agreement must be sent by certified or registered mail (return
receipt requested) or delivered personally or by courier (including a recognized
overnight delivery service) or by facsimile and will be effective five days
after being placed in the mail, if mailed by regular U.S. mail, or upon receipt,
if delivered personally, by courier (including a recognized overnight delivery
service) or by facsimile, in each case addressed to a party. The addresses for
such communications are:

        If to the Company:          George Wallace
                                    Micro Therapeutics, Inc.
                                    2 Goodyear
                                    Irvine, California 92618
                                    (949) 837-3700

                                       14
<PAGE>   15

        With a copy to:             Bruce W. Feuchter, Esq.
                                    Stradling Yocca Carlson & Rauth
                                    660 Newport Center Drive, Suite 1600
                                    Newport Beach, California 92660
                                    (949) 725-4000

        If to an Investor: To the address set forth immediately below such
Investor's name on the signature pages hereto.

        Each party will provide written notice to the other parties of any
change in its address.

        10.7 Successors and Assigns. This Agreement is binding upon and inures
to the benefit of the parties and their successors and assigns. The Company will
not assign this Agreement or any rights or obligations hereunder without the
prior written consent of the Investors, and no Investor may assign this
Agreement or any rights or obligations hereunder without the prior written
consent of the Company. Notwithstanding the foregoing, an Investor may assign
all or part of its rights and obligations hereunder to any of its "affiliates,"
as that term is defined under the Securities Act, without the consent of the
Company so long as the affiliate is an accredited investor (within the meaning
of Regulation D under the Securities Act) and agrees in writing to be bound by
this Agreement. This provision does not limit the Investor's right to transfer
the Securities pursuant to the terms of this Agreement or to assign the
Investor's rights hereunder to any such transferee pursuant to the terms of this
Agreement.

        10.8 Third Party Beneficiaries. This Agreement is intended for the
benefit of the parties hereto and their respective permitted successors and
assigns, and is not for the benefit of, nor may any provision hereof be enforced
by, any other person.

        10.9 Survival. The representations and warranties of the Company and the
agreements and covenants set forth herein will survive the Closing hereunder.
The Company makes no representations or warranties in any oral or written
information provided to Investors, other than the representations and warranties
included herein.

        10.10 Further Assurances. Each party will do and perform, or cause to be
done and performed, all such further acts and things, and will execute and
deliver all other agreements, certificates, instruments and documents, as
another party may reasonably request in order to carry out the intent and
accomplish the purposes of this Agreement and the consummation of the
transactions contemplated hereby.

        10.11 No Strict Construction. The language used in this Agreement is
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.

        10.12 Equitable Relief. The Company recognizes that, if it fails to
perform or discharge any of its obligations under this Agreement, any remedy at
law may prove to be inadequate relief to the Investors. The Company therefore
agrees that the Investors are entitled to temporary and permanent injunctive
relief in any such case without the necessity of proving actual damages.

                                       15
<PAGE>   16

        IN WITNESS WHEREOF, the undersigned Investors and the Company have
caused this Agreement to be duly executed as of the date first above written.

                                            COMPANY:

                                            Micro Therapeutics, Inc.

                                            By:    /s/ Harold A. Hurwitz
                                                   -----------------------------
                                            Name:  Harold A. Hurwitz
                                                   -----------------------------
                                            Title: Chief Financial Officer
                                                   -----------------------------

                                       16
<PAGE>   17

                            OMNIBUS SIGNATURE PAGE TO
                            MICRO THERAPEUTICS, INC.
                          SECURITIES PURCHASE AGREEMENT

        The undersigned hereby executes and delivers the Securities Purchase
Agreement to which this Signature Page is attached, which, together with all
counterparts of the Agreement and Signature Pages of the other parties named in
said Agreement, shall constitute one and the same document in accordance with
the terms of the Agreement.

                                           T. ROW PRICE NEW HORIZONS FUND, INC.

                                           Sign Name:  /s/ John H. Laporte
                                                       -------------------------
                                           Print Name: John H. Laporte, Director
                                                       -------------------------

                                       17
<PAGE>   18

                            OMNIBUS SIGNATURE PAGE TO
                            MICRO THERAPEUTICS, INC.
                          SECURITIES PURCHASE AGREEMENT

        The undersigned hereby executes and delivers the Securities Purchase
Agreement to which this Signature Page is attached, which, together with all
counterparts of the Agreement and Signature Pages of the other parties named in
said Agreement, shall constitute one and the same document in accordance with
the terms of the Agreement.

                                            PEQUOT PRIVATE EQUITY FUND II, L.P.

                                            Sign Name: /s/ David J. Malat
                                                       -------------------------
                                            By:  Pequot Capital Management, Inc.
                                                --------------------------------
                                                 David J. Malot, CFO
                                                --------------------------------
                                            Its: Investment Manager
                                                --------------------------------

                                       18
<PAGE>   19

                            OMNIBUS SIGNATURE PAGE TO
                            MICRO THERAPEUTICS, INC.
                          SECURITIES PURCHASE AGREEMENT

        The undersigned hereby executes and delivers the Securities Purchase
Agreement to which this Signature Page is attached, which, together with all
counterparts of the Agreement and Signature Pages of the other parties named in
said Agreement, shall constitute one and the same document in accordance with
the terms of the Agreement.

                                            FRAMLINGTON INVESTMENT MANAGEMENT
                                            FOR FRAMLINGTON HEALTH FUND

                                            Sign Name: /s/ Bill Kennedy
                                                       -------------------------
                                            Its:       Treasury Manager
                                                       -------------------------

                                       19
<PAGE>   20

                            OMNIBUS SIGNATURE PAGE TO
                            MICRO THERAPEUTICS, INC.
                          SECURITIES PURCHASE AGREEMENT

        The undersigned hereby executes and delivers the Securities Purchase
Agreement to which this Signature Page is attached, which, together with all
counterparts of the Agreement and Signature Pages of the other parties named in
said Agreement, shall constitute one and the same document in accordance with
the terms of the Agreement.

                                            FRAMLINGTON INVESTMENT MANAGEMENT
                                            FOR MUNDER HEALTH FUND

                                            Sign Name: /s/ Bill Kennedy
                                                       -------------------------
                                            Its:       Treasury Manager
                                                       -------------------------

                                       20<PAGE>   1

                                                                   EXHIBIT 10.31

                         REGISTRATION RIGHTS AGREEMENT

        This REGISTRATION RIGHTS AGREEMENT, dated as of March 10, 2000 (this
"Agreement"), is made by and among Micro Therapeutics, Inc., a Delaware
corporation, with headquarters located at 2 Goodyear, Irvine, California 92618
(the "Company"), and the investors named on the signature pages hereto (the
"Initial Investors").

                                    RECITALS:

        A. In connection with the Securities Purchase Agreement dated March 10,
2000 between the Initial Investors and the Company (the "Purchase Agreement"),
the Company has agreed, upon the terms and subject to the conditions of the
Purchase Agreement, to issue and sell to the Initial Investors 1,600,000 shares
of the Company's Common Stock (the "Common Shares").

        B. In order to induce the Initial Investors to execute and deliver the
Purchase Agreement, the Company has agreed to provide certain registration
rights under the Securities Act and applicable state securities laws with
respect to the Common Shares.

        In consideration of the premises and the mutual covenants contained
herein and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the Company and the Initial Investors hereby
agree as follows:

                                    ARTICLE I
                                   DEFINITIONS

        Capitalized terms used and not otherwise defined herein have the
respective meanings given them set forth in the Purchase Agreement. In addition,
as used in this Agreement, the following terms have the following meanings:

        1.1 "Common Shares" means the shares of Common Stock sold pursuant to
the Purchase Agreement.

        1.2 "Investors" means the Initial Investors and any of their transferees
or assignees who agree to become bound by the provisions of this Agreement in
accordance with Article IX hereof.

        1.3 "Registrable Securities" means the Common Shares sold pursuant to
the Purchase Agreement and any shares of capital stock issued or issuable from
time to time (with any adjustments) in exchange for or otherwise with respect to
the Common Shares.

        1.4 "Registration Period" means the period between the date of this
Agreement and the earlier of (i) the date on which all of the Registrable
Securities have been sold by the Initial Investors and no further Registrable
Securities may be issued in the future, or (ii) the date on which all the
Registrable Securities (in the opinion of the Investors' counsel) may be
immediately sold by the Initial Investors without registration and without
restriction (including without limitation as to volume by each holder thereof)
as to the number of Registrable Securities to be sold, pursuant to Rule 144 or
otherwise.

<PAGE>   2

        1.5 "Registration Statement" means a Registration Statement of the
Company filed under the Securities Act.

        1.6 The terms "register," "registered," and "registration" refer to a
registration effected by preparing and filing a Registration Statement or
statements in compliance with the Securities Act and pursuant to Rule 415 and
the declaration or ordering of effectiveness of such Registration Statement by
the SEC.

        1.7 "Rule 415" means Rule 415 under the Securities Act, or any successor
Rule providing for offering securities on a continuous basis, and applicable
rules and regulations thereunder.

                                   ARTICLE II
                                  REGISTRATION

        2.1 Mandatory Registration. The Company will use best efforts to file
with the SEC a Registration Statement on Form S-3 registering the Registrable
Securities and no other securities for resale within 30 business days after the
Closing Date of the purchase of the Common Shares under the Purchase Agreement.
If Form S-3 is not available at that time, then the Company will file a
Registration Statement on such form as is then available to effect a
registration of the Registrable Securities, subject to the consent of the
Initial Investors, which consent will not be unreasonably withheld.

        2.2 Effectiveness of the Registration Statement. The Company will use
its best efforts to cause the Registration Statement to be declared effective by
the SEC as soon as practicable after filing, and in any event no later than the
90th day after the Closing Date (the "Required Effective Date"). However, so
long as the Company filed the Registration Statement within 30 business days
after the Closing Date, (a) if the SEC takes the position that registration of
the resale of the Registrable Securities by the Investors is not available under
applicable laws, rules and regulation and that the Company must register the
offering of the Registrable Securities as a primary offering by the Company, or
(b) if the Registration Statement receives SEC review, then the Required
Effective Date will be the 120th day after the Closing Date. In the case of an
SEC response described in clause (a), the Company will, within 40 business days
after the date the Company receives such SEC response, file a Registration
Statement as a primary offering. The Company's best efforts will include, but
not be limited to, promptly responding to all comments received from the staff
of the SEC. If the Company receives notification from the SEC that the
Registration Statement will receive no action or review from the SEC, then the
Company will cause the Registration Statement to become effective within five
business days after such SEC notification. Once the Registration Statement is
declared effective by the SEC, the Company will cause the Registration Statement
to remain effective throughout the Registration Period, except as permitted
under Section 3.

        2.3 Payments by the Company. If (i) at any time after effectiveness of
the Registration Statement, sales cannot be made thereunder for any reason,
other than suspension of effectiveness of the Registration Statement as
described in Section 3.6, for a period of more than 10 consecutive business
days, or 30 days in the aggregate, during any 12-month period or (ii) the Common
Stock is not listed or included for quotation on Nasdaq, Nasdaq SmallCap, the
NYSE or AMEX for more than an aggregate of 10 business days in any 12-month
period, then the Company will thereafter make cash payments to each Investor as
partial compensation for such delay. The amount of the cash payment made to each
Investor will be equal to 2% of the purchase price paid for the Common

                                       2
<PAGE>   3

Shares purchased by the Investor and not previously sold by the Investor for the
first 30 days that sales cannot be made under the effective Registration
Statement or the Common Stock is not listed or included for quotation on Nasdaq,
Nasdaq SmallCap, the NYSE or AMEX. These payments will be prorated on a daily
basis during the 30 day period and will be paid to each Investor in cash within
five business days following the end of each month after the 20th day that sales
could not be made. Nothing herein limits any Investor's right to pursue actual
damages for the Company's failure to ensure sales can be made under the
Registration Statement or the Company's failure to ensure the Common Stock is
listed or included for quotation on the Nasdaq SmallCap market.

        2.4 Effect of Late Registration. If the Registration Statement has not
been declared effective by the Required Effective Date, then the Company will
make cash payments to each Investor as partial compensation for such delay (the
"Late Registration Payments"). The Late Registration Payments will be equal to
2% of the purchase price paid for the Common Shares purchased by such Investor
and not previously sold by such Investor for the first 30 days after the
Required Effective Date. The Late Registration Payments will be prorated on a
daily basis during the 30 day period and will be paid to the Initial Investors
in cash within five business days after the earlier of (i) the end of the 30
days following the Required Effective Date or (ii) the effective date of the
Registration Statement. Nothing herein limits any Investor's right to pursue
actual damages for the Company's failure to file a Registration Statement or to
have it declared effective by the SEC on or prior to the Required Effective Date
in accordance with the terms of this Agreement.

        2.5 Piggyback Registrations.

                (a) If, at any time prior to the expiration of the Registration
Period, a Registration Statement is not effective with respect to all of the
Registrable Securities and the Company decides to register any of its securities
for its own account or for the account of others, then the Company will promptly
give the Investors written notice thereof and will use its best efforts to
include in such registration all or any part of the Registrable Securities
requested by such Investors to be included therein (excluding any Registrable
Securities previously included in a Registration Statement). This requirement
does not apply to Company registrations on Form S-4 or S-8 or their equivalents
relating to equity securities to be issued solely in connection with an
acquisition of any entity or business or equity securities issuable in
connection with stock option or other employee benefit plans. Each Investor must
give its request for registration under this paragraph to the Company in writing
within 15 days after receipt from the Company of notice of such pending
registration. If the registration for which the Company gives notice is a public
offering involving an underwriting, the Company will so advise the Investors as
part of the above-described written notice. In that event, if the managing
underwriter(s) of the public offering impose a limitation on the number of
shares of Common Stock that may be included in the Registration Statement
because, in such underwriter(s)' judgment, such limitation would be necessary to
effect an orderly public distribution, then the Company will be obligated to
include only such limited portion, if any, of the Registrable Securities with
respect to which such Investors have requested inclusion hereunder. Any
exclusion of Registrable Securities will be made pro rata among all holders of
the Company's securities seeking to include shares of Common Stock in proportion
to the number of shares of Common Stock sought to be included by those holders.
However, the Company will not exclude any Registrable Securities unless the
Company has first excluded all outstanding securities the holders of which are
not entitled by right to inclusion of securities in such Registration Statement
or are not entitled pro rata inclusion with the Registrable Securities.

                                       3
<PAGE>   4

                (b) No right to registration of Registrable Securities under
this Section 2.5 limits in any way the registration required under Section 2.1
above. The obligations of the Company under this Section 2.5 expire upon the
earlier of (i) the effectiveness of the Registration Statement filed pursuant to
Section 2.1 above, (ii) after the Company has afforded the opportunity for the
Investors to exercise registration rights under this Section 2.5 for two
registrations (provided, however, that any Investor that has had any Registrable
Securities excluded from any Registration Statement in accordance with this
Section 2.5 may include in any additional Registration Statement filed by the
Company the Registrable Securities so excluded), (iii) when all of the
Registrable Securities held by any Investor may be sold by such Investor under
Rule 144 without being subject to any volume restrictions, or (iv) the second
anniversary of the date of this Agreement.

        2.6 Eligibility to use Form S-3. The Company represents and warrants
that it meets the requirements for the use of Form S-3 for registration of the
sale by the Investors of the Registrable Securities. The Company will file all
reports required to be filed by the Company with the SEC in a timely manner so
as to preserve its eligibility for the use of Form S-3.

                                   ARTICLE III
                      ADDITIONAL OBLIGATIONS OF THE COMPANY

        3.1 Continued Effectiveness of Registration Statement. Subject to the
limitations set forth in Section 3.6, the Company will keep the Registration
Statement covering the Registrable Securities effective under Rule 415 at all
times during the Registration Period. In the event that the number of shares
available under a Registration Statement filed pursuant to this Agreement is
insufficient to cover all of the Registrable Securities issued, the Company will
(if permitted) amend the Registration Statement or file a new Registration
Statement (on the short form available therefor, if applicable), or both, so as
to cover all of the Registrable Securities. The Company will file such amendment
or new Registration Statement as soon as practicable, but in no event later than
30 business days after the necessity therefor arises (based upon the market
price of the Common Stock and other relevant factors on which the Company
reasonably elects to rely). The Company will use its best efforts to cause such
amendment or new Registration Statement to become effective as soon as is
practicable after the filing thereof, but in no event later than 90 days after
the date on which the Company reasonably first determines (or reasonably should
have determined) the need therefor.

        3.2 Accuracy of Registration Statement. Any Registration Statement
(including any amendments or supplements thereto and prospectuses contained
therein) filed by the Company covering Registrable Securities will not contain
any untrue statement of a material fact or omit to state a material fact
required to be stated therein, or necessary to make the statements therein, in
light of the circumstances in which they were made, not misleading. The Company
will prepare and file with the SEC such amendments (including post-effective
amendments) and supplements to the Registration Statement and the prospectus
used in connection with the Registration Statement as may be necessary to permit
sales pursuant to the Registration Statement at all times during the
Registration Period, and, during such period, will comply with the provisions of
the Securities Act with respect to the disposition of all Registrable Securities
of the Company covered by the Registration Statement until the termination of
the Registration Period, or if earlier, until such time as all of such
Registrable Securities have been disposed of in accordance with the intended
methods of disposition by the seller or sellers thereof as set forth in the
Registration Statement.

        3.3 Furnishing Documentation. The Company will furnish to each Investor
whose Registrable Securities are included in a Registration Statement, or to its
legal counsel, (a) promptly

                                       4
<PAGE>   5

after each document is prepared and publicly distributed, filed with the SEC or
received by the Company, one copy of any Registration Statement filed pursuant
to this Agreement and any amendments thereto, each preliminary prospectus and
final prospectus and each amendment or supplement thereto; and (b) a number of
copies of a prospectus, including a preliminary prospectus, and all amendments
and supplements thereto, and such other documents as the Investor may reasonably
request in order to facilitate the disposition of the Registrable Securities
owned by the Investor. The Company will immediately notify by facsimile each
Investor whose Registrable Securities are included in any Registration Statement
of the effectiveness of the Registration Statement and any post-effective
amendment.

        3.4 Additional Obligations. The Company will use its best efforts to (a)
register and qualify the Registrable Securities covered by a Registration
Statement under such other securities or blue sky laws of such jurisdictions as
each Investor who holds (or has the right to hold) Registrable Securities being
offered reasonably requests, (b) prepare and file in those jurisdictions any
amendments (including post-effective amendments) and supplements to such
registrations and qualifications as may be necessary to maintain their
effectiveness during the Registration Period, (c) take any other actions
necessary to maintain such registrations and qualifications in effect at all
times during the Registration Period, and (d) take any other actions reasonably
necessary or advisable to qualify the Registrable Securities for sale in such
jurisdictions. Notwithstanding the foregoing, the Company is not required, in
connection such obligations, to (i) qualify to do business in any jurisdiction
where it would not otherwise be required to qualify but for this Section 3.4,
(ii) subject itself to general taxation in any such jurisdiction, (iii) file a
general consent to service of process in any such jurisdiction, (iv) provide any
undertakings that cause material expense or burden to the Company, or (v) make
any change in its charter or bylaws, which in each case the Board of Directors
of the Company determines to be contrary to the best interests of the Company
and its stockholders.

        3.5 Underwritten Offerings. If the Investors who hold a majority in
interest of the Registrable Securities being offered in an offering pursuant to
a Registration Statement or any amendment or supplement thereto under this
Agreement select underwriters reasonably acceptable to the Company for such
offering, the Company will enter into and perform its obligations under an
underwriting agreement in usual and customary form including, without
limitation, customary indemnification and contribution obligations, with the
managing underwriter of such offering.

        3.6 Suspension of Registration.

                (a) The Company will notify (by telephone and also by facsimile
and reputable overnight courier) each Investor who holds Registrable Securities
being sold pursuant to a Registration Statement of the happening of any event of
which the Company has knowledge as a result of which the prospectus included in
the Registration Statement as then in effect includes an untrue statement of a
material fact or omits to state a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading. The Company will make such notification as
promptly as practicable after the Company becomes aware of the event (but in no
event, without the prior written consent of the Investor, will the Company
disclose to any Investor any of the facts or circumstances regarding the event),
will promptly (but in no event more than ten business days) prepare a supplement
or amendment to the Registration Statement to correct such untrue statement or
omission, and will deliver a number of copies of such supplement or amendment to
each Investor as such Investor may reasonably request.

                                       5
<PAGE>   6

                (b) Notwithstanding the obligations under Section 3.6(a), if in
the good faith judgment of the Company, following consultation with legal
counsel, it would be detrimental to the Company and its stockholders for resales
of Registrable Securities to be made pursuant to the Registration Statement due
to (i) the existence of a material development or potential material development
involving the Company which the Company would be obligated to disclose in the
Registration Statement, which disclosure would be premature or otherwise
inadvisable at such time or would have a Material Adverse Effect upon the
Company and its stockholders, or (ii) in the good faith judgment of the
Company's Board of Directors, it would adversely affect or require premature
disclosure of the filing of a Company-initiated registration of any class of its
equity securities, the Company will have the right to suspend the use of the
Registration Statement for a period of not more than ninety days, provided,
however, that the Company may so defer or suspend the use of the Registration
Statement no more than one time in any twelve-month period, and provided,
further, that, after deferring or suspending the use of the Registration
Statement, the Company may not again defer or suspend the use of the
Registration Statement until a period of thirty days has elapsed after
resumption of the use of the Registration Statement.

                (c) Subject to the Company's rights under this Section 3, the
Company will use its best efforts to prevent the issuance of any stop order or
other suspension of effectiveness of a Registration Statement and, if such an
order is issued, will use its best efforts to obtain the withdrawal of such
order at the earliest possible time and to notify each Investor that holds
Registrable Securities being sold (or, in the event of an underwritten offering,
the managing underwriters) of the issuance of such order and the resolution
thereof.

                (d) Notwithstanding anything to the contrary contained herein or
in the Purchase Agreement, if the use of the Registration Statement is suspended
by the Company, the Company will promptly give notice of the suspension to all
Investors whose securities are covered by the Registration Statement, and will
promptly notify each such Investor as soon as the use of the Registration
Statement may be resumed. Notwithstanding anything to the contrary contained
herein or in the Purchase Agreement, the Company will cause the Transfer Agent
to deliver unlegended shares of Common Stock to a transferee of an Investor in
accordance with the terms of the Purchase Agreement in connection with any sale
of Registrable Securities with respect to which such Investor has entered into a
contract for sale prior to receipt of notice of such suspension and for which
such Investor has not yet settled.

        3.7 Review by the Investors. The Company will permit a single firm of
legal counsel, designated by the Investors who hold a majority in interest of
the Registrable Securities being sold pursuant to a Registration Statement, to
review the Registration Statement and all amendments and supplements thereto (as
well as all requests for acceleration or effectiveness thereof) a reasonable
period of time prior to their filing with the SEC, and will not file any
document in a form to which such counsel reasonably objects, unless otherwise
required by law in the opinion of the Company's counsel. The sections of any
such Registration Statement including information with respect to the Investors,
the Investors' beneficial ownership of securities of the Company or the
Investors' intended method of disposition of Registrable Securities must conform
to the information provided to the Company by each of the Investors.

        3.8 Comfort Letter; Legal Opinion. At the request of the Investors who
hold a majority in interest of the Registrable Securities being sold pursuant to
a Registration Statement, and on the date that Registrable Securities are
delivered to an underwriter for sale in connection with the Registration
Statement, the Company will furnish to the Investors and the underwriters (i) a
letter,

                                       6
<PAGE>   7

dated such date, from the Company's independent certified public accountants, in
form and substance as is customarily given by independent certified public
accountants to underwriters in an underwritten public offering, addressed to the
underwriters; and (ii) an opinion, dated such date, from counsel representing
the Company for purposes of the Registration Statement, in form and substance as
is customarily given in an underwritten public offering, addressed to the
underwriters and Investors.

        3.9 Due Diligence; Confidentiality.

                (a) The Company will make available for inspection by any
Investor whose Registrable Securities are being sold pursuant to a Registration
Statement, any underwriter participating in any disposition pursuant to the
Registration Statement, and any attorney, accountant or other agent retained by
any such Investor or underwriter (collectively, the "Inspectors"), all pertinent
financial and other records, pertinent corporate documents and properties of the
Company (collectively, the "Records"), as each Inspector reasonably deems
necessary to enable the Inspector to exercise its due diligence responsibility.
The Company will cause its officers, directors and employees to supply all
information that any Inspector may reasonably request for purposes of performing
such due diligence.

                (b) Each Inspector will hold in confidence, and will not make
any disclosure (except to an Investor) of, any Records or other information that
the Company determines in good faith to be confidential, and of which
determination the Inspectors are so notified, unless (i) the disclosure of such
Records is necessary to avoid or correct a misstatement or omission in any
Registration Statement, (ii) the release of such Records is ordered pursuant to
a subpoena or other order from a court or government body of competent
jurisdiction, (iii) the information in such Records has been made generally
available to the public other than by disclosure in violation of this or any
other agreement (to the knowledge of the relevant Inspector), (iv) the Records
or other information was developed independently by an Inspector without breach
of this Agreement, (v) the information was known to the Inspector before receipt
of such information from the Company, or (vi) the information was disclosed to
the Inspector by a third party without restriction. The Company is not required
to disclose any confidential information in the Records to any Inspector unless
and until such Inspector has entered into a confidentiality agreement (in form
and substance satisfactory to the Company) with the Company with respect
thereto, substantially in the form of this Section 3.9. Each Investor will, upon
learning that disclosure of Records containing confidential information is
sought in or by a court or governmental body of competent jurisdiction or
through other means, give prompt notice to the Company and allow the Company, at
the Company's expense, to undertake appropriate action to prevent disclosure of,
or to obtain a protective order for, the Records deemed confidential. Nothing
herein will be deemed to limit the Investor's ability to sell Registrable
Securities in a manner that is otherwise consistent with applicable laws and
regulations.

                (c) The Company will hold in confidence, and will not make any
disclosure of, information concerning an Investor provided to the Company under
this Agreement unless (i) disclosure of such information is necessary to comply
with federal or state securities laws, (ii) the disclosure of such information
is necessary to avoid or correct a misstatement or omission in any Registration
Statement, (iii) the release of such information is ordered pursuant to a
subpoena or other order from a court or governmental body of competent
jurisdiction, (iv) such information has been made generally available to the
public other than by disclosure in violation of this Agreement or any other
agreement (v) the information was disclosed to the Company by a third party
without restriction or (vi) such Investor consents to the form and content of
any such disclosure. If the

                                       7
<PAGE>   8

Company learns that disclosure of such information concerning an Investor is
sought in or by a court or governmental body of competent jurisdiction or
through other means, the Company will give prompt notice to such Investor prior
to making such disclosure and allow such Investor, at its expense, to undertake
appropriate action to prevent disclosure of, or to obtain a protective order
for, such information.

        3.10 Listing. The Company will (i) cause all of the Registrable
Securities covered by each Registration Statement to be listed on each national
securities exchange on which securities of the same class or series issued by
the Company are then listed, if any, if the listing of such Registrable
Securities is then permitted under the rules of such exchange, or (ii) to the
extent the securities of the same class or series are not then listed on a
national securities exchange, secure the designation and quotation of all of the
Registrable Securities covered by each Registration Statement on Nasdaq and,
without limiting the generality of the foregoing, arrange for at least two
market makers to register with the National Association of Securities Dealers,
Inc. as such with respect to such Registrable Securities.

        3.11 Transfer Agent; Registrar. The Company will provide a transfer
agent and registrar, which may be a single entity, for the Registrable
Securities not later than the effective date of the Registration Statement.

        3.12 Share Certificates. The Company will cooperate with the Investors
who hold Registrable Securities being sold and with the managing underwriter(s),
if any, to facilitate the timely preparation and delivery of certificates (not
bearing any restrictive legends) representing Registrable Securities to be
offered pursuant to a Registration Statement and will enable such certificates
to be in such denominations or amounts as the case may be, and registered in
such names as the Investors or the managing underwriter(s), if any, may
reasonably request, all in accordance with Article V of the Purchase Agreement.

        3.13 Plan of Distribution. At the request of the Investors holding a
majority in interest of the Registrable Securities registered pursuant to a
Registration Statement, the Company will promptly prepare and file with the SEC
such amendments (including post-effective amendments) and supplements to the
Registration Statement, and the prospectus used in connection with the
Registration Statement, as may be necessary in order to change the plan of
distribution set forth in such Registration Statement.

        3.14 Securities Laws Compliance. The Company will comply with all
applicable laws related to any Registration Statement relating to the sale of
Registrable Securities and to offering and sale of securities and with all
applicable rules and regulations of governmental authorities in connection
therewith (including, without limitation, the Securities Act, the Exchange Act
and the rules and regulations promulgated by the SEC).

        3.15 Further Assurances. The Company will take all other reasonable
actions as any Investor or the underwriters, if any, may reasonably request to
expedite and facilitate disposition by such Investor of the Registrable
Securities pursuant to the Registration Statement.

        3.16 No Additional Selling Shareholders. The Company will not, and will
not agree to, allow the holders of any securities of the Company to include any
of their securities in any Registration Statement under Section 2.1 hereof, or
any amendment or supplement thereto under

                                       8
<PAGE>   9

Section 3.2 hereof, without the consent of the holders of a majority in interest
of the Registrable Securities.

                                   ARTICLE IV
                          OBLIGATIONS OF THE INVESTORS

        4.1 Investor Information. As a condition to the obligations of the
Company to complete any registration pursuant to this Agreement with respect to
the Registrable Securities of each Investor, such Investor will furnish to the
Company such information regarding itself, the Registrable Securities held by it
and the intended method of disposition of the Registrable Securities held by it
as is reasonably required by the Company to effect the registration of the
Registrable Securities. At least 10 business days prior to the first anticipated
filing date of a Registration Statement for any registration under this
Agreement, the Company will notify each Investor of the information the Company
requires from that Investor if the Investor elects to have any of its
Registrable Securities included in the Registration Statement. If, within three
business days prior to the filing date, the Company has not received the
requested information from an Investor, then the Company may file the
Registration Statement without including Registrable Securities of that
Investor.

        4.2 Further Assurances. Each Investor will cooperate with the Company,
as reasonably requested by the Company, in connection with the preparation and
filing of any Registration Statement hereunder, unless such Investor has
notified the Company in writing of such Investor's election to exclude all of
such Investor's Registrable Securities from the Registration Statement.

        4.3 Suspension of Sales. Upon receipt of any notice from the Company of
the happening of any event of the kind described in Section 3.6, each Investor
will immediately discontinue disposition of Registrable Securities pursuant to
the Registration Statement covering such Registrable Securities until it
receives copies of the supplemented or amended prospectus contemplated by
Section 3.6. If so directed by the Company, each Investor will deliver to the
Company (at the expense of the Company) or destroy (and deliver to the Company a
certificate of destruction) all copies in the Investor's possession (other than
a limited number of file copies) of the prospectus covering such Registrable
Securities that is current at the time of receipt of such notice.

        4.4 Underwritten Offerings.

                (a) If Investors holding a majority in interest of the
Registrable Securities being registered (with the approval of the Initial
Investors) determine to engage the services of an underwriter, each Investor
will enter into and perform such Investor's obligations under an underwriting
agreement, in usual and customary form, including, without limitation, customary
indemnification and contribution obligations, with the managing underwriter of
such offering, and will take such other actions as are reasonably required in
order to expedite or facilitate the disposition of the Registrable Securities,
unless such Investor has notified the Company in writing of such Investor's
election to exclude all of its Registrable Securities from such Registration
Statement.

                (b) Without limiting any Investor's rights under Section 2.1
hereof, no Investor may participate in any underwritten distribution hereunder
unless such Investor (a) agrees to sell such Investor's Registrable Securities
on the basis provided in any underwriting arrangements approved by the Investors
entitled hereunder to approve such arrangements, (b) completes and executes all
questionnaires, powers of attorney, indemnities, underwriting agreements and
other documents reasonably required under the terms of such underwriting
arrangements, and (c) agrees to pay its pro

                                       9
<PAGE>   10

rata share of all underwriting discounts and commissions and other fees and
expenses of investment bankers and any manager or managers of such underwriting,
and legal expenses of the underwriter, applicable with respect to its
Registrable Securities, in each case to the extent not payable by the Company
under the terms of this Agreement.

                                    ARTICLE V
                            EXPENSES OF REGISTRATION

        The Company will bear all reasonable expenses, other than underwriting
discounts and commissions, and transfer taxes, if any, incurred in connection
with registrations, filings or qualifications pursuant to Articles II and III of
this Agreement, including, without limitation, all registration, listing and
qualifications fees, printers and accounting fees, the fees and disbursements of
counsel for the Company, and the reasonable fees and disbursements of one firm
of legal counsel selected by the Initial Investors pursuant to Section 3.7
hereof.

                                   ARTICLE VI
                                 INDEMNIFICATION

        In the event that any Registrable Securities are included in a
Registration Statement under this Agreement:

        6.1 To the extent permitted by law, the Company will indemnify and hold
harmless each Investor that holds such Registrable Securities, any underwriter
(as defined in the Securities Act) for the Investors, any directors or officers
of such Investor or such underwriter and any person who controls such Investor
or such underwriter within the meaning of the Securities Act or the Exchange Act
(each, an "Indemnified Person") against any losses, claims, damages, expenses or
liabilities (joint or several) (collectively, and together with actions,
proceedings or inquiries by any regulatory or self-regulatory organization,
whether commenced or threatened in respect thereof, "Claims") to which any of
them become subject under the Securities Act, the Exchange Act or otherwise,
insofar as such Claims arise out of or are based upon any of the following
statements, omissions or violations in a Registration Statement filed pursuant
to this Agreement, any post-effective amendment thereof or any prospectus
included therein: (a) any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or any post-effective
amendment thereof or the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, (b) any untrue statement or alleged untrue statement of
a material fact contained in the prospectus (as it may be amended or
supplemented) or the omission or alleged omission to state therein any material
fact necessary to make the statements made therein, in light of the
circumstances under which the statements therein were made, not misleading, or
(c) any violation or alleged violation by the Company of the Securities Act, the
Exchange Act or any other law, including without limitation any state securities
law or any rule or regulation thereunder (the matters in the foregoing clauses
(a) through (c) being, collectively, "Violations"). Subject to the restrictions
set forth in Section 6.3 with respect to the number of legal counsel, the
Company will reimburse the Investors and each such underwriter or controlling
person and each such other Indemnified Person, promptly as such expenses are
incurred and are due and payable, for any legal fees or other reasonable
expenses incurred by them in connection with investigating or defending any
Claim. Notwithstanding anything to the contrary contained herein, the
indemnification agreement contained in this Section 6.1 (i) does not apply to a
Claim by an Indemnified Person arising out of or based upon a Violation that
occurs in reliance upon and in conformity with information furnished in writing
to the Company by such Indemnified Person

                                       10
<PAGE>   11

expressly for use in connection with the preparation of the Registration
Statement or any such amendment thereof or supplement thereto, if such
prospectus was timely made available by the Company pursuant to Section 3.3
hereof; and (ii) does not apply to amounts paid in settlement of any Claim if
such settlement is made without the prior written consent of the Company, which
consent will not be unreasonably withheld. This indemnity obligation will remain
in full force and effect regardless of any investigation made by or on behalf of
the Indemnified Persons and will survive the transfer of the Registrable
Securities by the Investors under Article IX of this Agreement.

        6.2 In connection with any Registration Statement in which an Investor
is participating, each such Investor will indemnify and hold harmless, to the
same extent and in the same manner set forth in Section 6.1 above, the Company,
each of its directors, each of its officers who signs the Registration
Statement, each person, if any, who controls the Company within the meaning of
the Securities Act or the Exchange Act, and any other stockholder selling
securities pursuant to the Registration Statement or any of its directors or
officers or any person who controls such stockholder within the meaning of the
Securities Act or the Exchange Act (each an "Indemnified Person") against any
Claim to which any of them may become subject under the Securities Act, the
Exchange Act or otherwise, insofar as such Claim arises out of or is based upon
any Violation, in each case to the extent (and only to the extent) that such
Violation occurs in reliance upon and in conformity with written information
furnished to the Company by such Investor expressly for use in connection with
such Registration Statement. Subject to the restrictions set forth in Section
6.3, such Investor will promptly reimburse any legal or other expenses (promptly
as such expenses are incurred and due and payable) reasonably incurred by them
in connection with investigating or defending any such Claim. However, the
indemnity agreement contained in this Section 6.2 does not apply to amounts paid
in settlement of any Claim if such settlement is effected without the prior
written consent of such Investor, which consent will not be unreasonably
withheld, and no Investor will be liable under this Agreement (including this
Section 6.2 and Article VII) for the amount of any Claim that exceeds the net
proceeds actually received by such Investor as a result of the sale of
Registrable Securities pursuant to such Registration Statement. This indemnity
will remain in full force and effect regardless of any investigation made by or
on behalf of an Indemnified Party and will survive the transfer of the
Registrable Securities by the Investors under Article IX of this Agreement.

        6.3 Promptly after receipt by an Indemnified Person under this Article
VI of notice of the commencement of any action (including any governmental
action), such Indemnified Person will, if a Claim in respect thereof is to be
made against any indemnifying party under this Article VI, deliver to the
indemnifying party a written notice of the commencement thereof. The
indemnifying party may participate in, and, to the extent the indemnifying party
so desires, jointly with any other indemnifying party similarly given notice,
assume control of the defense thereof with counsel mutually satisfactory to the
indemnifying parties and the Indemnified Person. In that case, the indemnifying
party will diligently pursue such defense. If, in the reasonable opinion of
counsel retained by the indemnifying party, the representation by such counsel
of the Indemnified Person and the indemnifying party would be inappropriate due
to actual or potential conflicts of interest between the Indemnified Person and
any other party represented by such counsel in such proceeding or the actual or
potential defendants in, or targets of, any such action including the
Indemnified Person, and any such Indemnified Person reasonably determines that
there may be legal defenses available to such Indemnified Person that are
different from or in addition to those available to the indemnifying party, then
the Indemnified Person is entitled to assume such defense and may retain its own
counsel, with the fees and expenses to be paid by the indemnifying party. The
Company will pay for only one separate legal counsel for the Investors
collectively, and such legal counsel will be selected by the Investors holding a
majority in interest of the Registrable Securities. The failure to deliver
written

                                       11
<PAGE>   12

notice to the indemnifying party within a reasonable time of the commencement of
any such action does not relieve an indemnifying party of any liability to an
Indemnified Person under this Article VI, except to the extent that the
indemnifying party is prejudiced in its ability to defend such action. The
indemnification required by this Article VI will be made by periodic payments of
the amount thereof during the course of the investigation or defense, as such
expense, loss, damage or liability is incurred and is due and payable.

                                   ARTICLE VII
                                  CONTRIBUTION

        To the extent that any indemnification provided for herein is prohibited
or limited by law, the indemnifying party will make the maximum contribution
with respect to any amounts for which it would otherwise be liable under Article
VI to the fullest extent permitted by law. However, (a) no contribution will be
made under circumstances where the maker would not have been liable for
indemnification under the fault standards set forth in Article VI, (b) no seller
of Registrable Securities guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) will be entitled to contribution
from any seller of Registrable Securities who was not guilty of such fraudulent
misrepresentation, and (c) contribution (together with any indemnification or
other obligations under this Agreement) by any seller of Registrable Securities
will be limited in amount to the net amount of proceeds received by such seller
from the sale of such Registrable Securities.

                                  ARTICLE VIII
                             EXCHANGE ACT REPORTING

        In order to make available to the Investors the benefits of Rule 144 or
any similar rule or regulation of the SEC that may at any time permit the
Investors to sell securities of the Company to the public without registration,
the Company will:

                (a) File with the SEC in a timely manner, and make and keep
available, all reports and other documents required of the Company under the
Securities Act and the Exchange Act so long as the Company remains subject to
such requirements (it being understood that nothing herein limits the Company's
obligations under Section 4.3 of the Purchase Agreement) and the filing and
availability of such reports and other documents is required for the applicable
provisions of Rule 144; and

                (b) Furnish to each Investor, so long as such Investor holds
Registrable Securities, promptly upon the Investor's request, (i) a written
statement by the Company that it has complied with the reporting requirements of
Rule 144, the Securities Act and the Exchange Act, (ii) a copy of the most
recent annual or quarterly report of the Company and such other reports and
documents filed by the Company with the SEC and (iii) such other information as
may be reasonably requested to permit the Investors to sell such securities
pursuant to Rule 144 without registration.

                                   ARTICLE IX
                        ASSIGNMENT OF REGISTRATION RIGHTS

        The rights of the Investors hereunder, including the right to have the
Company register Registrable Securities pursuant to this Agreement, will be
automatically assigned by the Investors to transferees or assignees of all or
any portion of the Registrable Securities, but only if (a) the Investor

                                       12
<PAGE>   13

agrees in writing with the transferee or assignee to assign such rights, and a
copy of such agreement is furnished to the Company within a reasonable time
after such assignment, (b) the Company is, within a reasonable time after such
transfer or assignment, furnished with written notice of the name and address of
such transferee or assignee and the securities with respect to which such
registration rights are being transferred or assigned, (c) after such transfer
or assignment, the further disposition of such securities by the transferee or
assignee is restricted under the Securities Act and applicable state securities
laws, (d) at or before the time the Company received the written notice
contemplated by clause (b) of this sentence, the transferee or assignee agrees
in writing with the Company to be bound by all of the provisions contained
herein, (e) such transfer is made in accordance with the applicable requirements
of the Purchase Agreement, and (f) the transferee is an "accredited investor" as
that term is defined in Rule 501 of Regulation D.

                                    ARTICLE X
                        AMENDMENT OF REGISTRATION RIGHTS

        This Agreement may be amended and the obligations hereunder may be
waived (either generally or in a particular instance, and either retroactively
or prospectively) only with the written consent of the Company and of the
Investors who then hold a two-thirds (2/3) interest of the Registrable
Securities (but not including any Investor who is not affected by such amendment
or waiver). Any amendment or waiver effected in accordance with this Article X
is binding upon each Investor and the Company. Notwithstanding the foregoing, no
amendment or waiver will retroactively affect any Investor without its consent,
or will prospectively adversely affect any Investor who no longer owns any
Registrable Securities without its consent. Neither Article VI nor Article VII
hereof may be amended or waived in a manner adverse to an Investor without its
consent.

                                   ARTICLE XI
                                  MISCELLANEOUS

        11.1 Conflicting Instructions. A person or entity is deemed to be a
holder of Registrable Securities whenever such person or entity owns of record
such Registrable Securities. If the Company receives conflicting instructions,
notices or elections from two or more persons or entities with respect to the
same Registrable Securities, the Company will act upon the basis of
instructions, notice or election received from the registered owner of such
Registrable Securities.

        11.2 Notices. Any notices required or permitted to be given under the
terms of this Agreement will be given as set forth in the Purchase Agreement.

        11.3 Waiver. Failure of any party to exercise any right or remedy under
this Agreement or otherwise, or delay by a party in exercising such right or
remedy, does not operate as a waiver thereof.

        11.4 Governing Law. This Agreement will be governed by and interpreted
in accordance with the laws of the State of Delaware without regard to the
principles of conflict of laws. The parties hereto hereby submit to the
exclusive jurisdiction of the United States federal and state courts located in
the State of Delaware with respect to any dispute arising under this Agreement,
the agreements entered into in connection herewith or the transactions
contemplated hereby or thereby.

        11.5 Severability. If any provision of this Agreement is invalid or
unenforceable under any applicable statute or rule of law, then such provision
will be deemed modified in order to

                                       13
<PAGE>   14

conform with such statute or rule of law. Any provision hereof that may prove
invalid or unenforceable under any law will not affect the validity or
enforceability of any other provision hereof.

        11.6 Entire Agreement. This Agreement and the Purchase Agreement
(including all schedules and exhibits thereto) constitute the entire agreement
among the parties hereto with respect to the subject matter hereof and thereof.
There are no restrictions, promises, warranties or undertakings, other than
those set forth or referred to herein or therein. This Agreement supersedes all
prior agreements and understandings among the parties hereto with respect to the
subject matter hereof.

        11.7 Successors and Assigns. Subject to the requirements of Article IX
hereof, this Agreement inures to the benefit of and is binding upon the
successors and assigns of each of the parties hereto. Notwithstanding anything
to the contrary herein, including, without limitation, Article IX, the rights of
an Investor hereunder are assignable to and exercisable by a bona fide pledgee
of the Registrable Securities in connection with an Investor's margin or
brokerage accounts.

        11.8 Use of Pronouns. All pronouns refer to the masculine, feminine or
neuter, singular or plural, as the context may require.

        11.9 Headings. The headings of this Agreement are for convenience of
reference only, are not part of this Agreement and do not affect its
interpretation.

        11.10 Counterparts. This Agreement may be executed in two or more
counterparts, each of which is deemed an original but all of which constitute
one and the same agreement. This Agreement, once executed by a party, may be
delivered to the other party hereto by facsimile transmission, and facsimile
signatures are binding on the parties hereto.

        11.11 Further Assurances. Each party will do and perform, or cause to be
done and performed, all such further acts and things, and will execute and
deliver all other agreements, certificates, instruments and documents, as
another party may reasonably request in order to carry out the intent and
accomplish the purposes of this Agreement and the consummation of the
transactions contemplated hereby.

        11.12 Consents. All consents and other determinations to be made by the
Investors pursuant to this Agreement will be made by the Initial Investors or
the Investors holding a majority in interest of the Registrable Securities.

        11.13 No Strict Construction. The language used in this Agreement is
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.

                                       14
<PAGE>   15

        IN WITNESS WHEREOF, the undersigned Investors and the Company have
caused this Agreement to be duly executed as of the date first above written.

                                            COMPANY:

                                            MICRO THERAPEUTICS, INC.

                                            By:    /s/ Harold A. Hurwitz
                                               ---------------------------------
                                               Name:  Harold A. Hurwitz
                                               Title: Chief Financial Officer

                                            INVESTOR:

                                            T. ROWE PRICE NEW HORIZONS FUND,
                                            INC.

                                            By:    /s/ John H. Laporte
                                               ---------------------------------
                                               Name:  John H. Laporte
                                               Its:   Director

                                       15
<PAGE>   16

        IN WITNESS WHEREOF, the undersigned Investors and the Company have
caused this Agreement to be duly executed as of the date first above written.

                                            COMPANY:

                                            MICRO THERAPEUTICS, INC.

                                            By:    /s/ Harold A. Hurwitz
                                               ---------------------------------
                                               Name:  Harold A. Hurwitz
                                               Title: Chief Financial Officer

                                            INVESTOR:

                                            PEQUOT PRIVATE EQUITY FUND II, L.P.

                                            By:    /s/ David J. Malat
                                               ---------------------------------
                                               Name:  Pequot Capital Management,
                                                      Inc.
                                                      David J. Malat, CFO
                                               Its:   Investment Manager

                                       16
<PAGE>   17

        IN WITNESS WHEREOF, the undersigned Investors and the Company have
caused this Agreement to be duly executed as of the date first above written.

                                            COMPANY:

                                            MICRO THERAPEUTICS, INC.

                                            By:    /s/ Harold A. Hurwitz
                                               ---------------------------------
                                               Name:  Harold A. Hurwitz
                                               Title: Chief Financial Officer

                                            INVESTOR:

                                            FRAMLINGTON INVESTMENT MANAGEMENT
                                            FOR FRAMLINGTON HEALTH FUND

                                            By:    /s/ Bill Kennedy
                                               ---------------------------------
                                               Name:  Bill Kennedy
                                               Its:   Treasury Manager

                                       17
<PAGE>   18

        IN WITNESS WHEREOF, the undersigned Investors and the Company have
caused this Agreement to be duly executed as of the date first above written.

                                            COMPANY:

                                            MICRO THERAPEUTICS, INC.

                                            By:    /s/ Harold A. Hurwitz
                                               ---------------------------------
                                               Name:  Harold A. Hurwitz
                                               Title: Chief Financial Officer

                                            INVESTOR:

                                            FRAMLINGTON INVESTMENT MANAGEMENT
                                            FOR MUNDER HEALTH FUND

                                            By:    /s/ Bill Kennedy
                                               ---------------------------------
                                               Name:  Bill Kennedy
                                               Its:   Treasury Manager

                                       18

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