SECURITIES PURCHASE AGREEMENT
Exhibit 10.1
SECURITIES PURCHASE AGREEMENT
This Securities Purchase Agreement (this “Agreement”) is dated as of November 29, 2005, among
MicroMed Cardiovascular, Inc., a Delaware corporation (the “Company”), on the one hand, and each
purchaser identified on the signature pages hereto (each, including its successors and assigns, a
“Purchaser” and collectively the “Purchasers”) on the other hand;
WHEREAS, subject to the terms and conditions set forth in this Agreement and pursuant to
Section 4(2) of the Securities Act (as defined below), and Rule 506 promulgated thereunder, the
Company desires to issue and sell to each Purchaser, and each Purchaser, severally and not jointly,
desires to purchase from the Company in the aggregate, up to $5,150,000 of shares of Common Stock
on the Closing Date.
NOW, THEREFORE, IN CONSIDERATION of the mutual covenants contained in this Agreement, and for
other good and valuable consideration the receipt and adequacy of which are hereby acknowledged,
the Company and each Purchaser agrees as follows:
ARTICLE I
DEFINITIONS
DEFINITIONS
1.1 Definitions. In addition to the terms defined elsewhere in this Agreement, for
all purposes of this Agreement, the following terms have the meanings indicated in this Section
1.1:
“Action” shall have the meaning ascribed to such term in Section 3.1(i).
“Affiliate” means any Person that, directly or indirectly through one or more
intermediaries, controls or is controlled by or is under common control with a Person as such terms
are used in and construed under Rule 144. With respect to a Purchaser, any investment fund or
managed account that is managed on a discretionary basis by the same investment manager as such
Purchaser will be deemed to be an Affiliate of such Purchaser.
“Anti-Dilution Shares” means any Shares issued further to Section 4.9 hereof or
further to Section 4.9 of the August 2005 Securities Purchase Agreement.
“August 2005 Purchase Agreement” means that Securities Purchase Agreement dated as of
August 9, 2005 by and among the Company and certain purchasers named therein.
“Closing” means the closing of the purchase and sale of the Shares and the Placement
Agent Warrants pursuant to Section 2.1.
“Closing Date” means the date when all of the Transaction Documents have been executed
and delivered by the applicable parties thereto, and all conditions precedent to (i) the
Purchasers’ obligations to pay the Subscription Amount and (ii) the Company’s obligations to
deliver the Shares have been satisfied or waived.
“Commission” means the Securities and Exchange Commission.
“Common Stock” means the common stock of the Company, par value $0.001 per share, and
any securities into which such common stock may hereafter be reclassified.
“Common Stock Equivalents” means any securities of the Company or the Subsidiaries
which would entitle the holder thereof to acquire at any time Common Stock, including without
limitation, any debt, preferred stock, rights, options, warrants or other instrument that is at any
time convertible into or exchangeable for, or otherwise entitles the holder thereof to receive,
Common Stock.
“Disclosure Schedules” means the Disclosure Schedules of the Company delivered
concurrently herewith.
“Effective Date” means the date that the Registration Statement is first declared
effective by the Commission.
“Exchange Act” means the Securities Exchange Act of 1934, as amended.
“Exempt Issuance” means the issuance of (a) shares of Common Stock or options to
employees, officers or directors of the Company pursuant to any stock or option plan duly adopted
by a majority of the non-employee members of the Board of Directors of the Company or a majority of
the members of a committee of non-employee directors established for such purpose, (b) securities
upon the exercise of or conversion of any securities issued hereunder, or convertible securities,
options or warrants issued and outstanding on the date of this Agreement, provided that such
securities have not been amended since the date of this Agreement to increase the number of such
securities, (c) securities issued pursuant to strategic transactions with an operating company in a
business synergistic with the business of the Company and in which the Company receives benefits in
addition to the investment of funds or pursuant to acquisitions, but shall not include a
transaction in which the Company is issuing securities primarily for the purpose of raising capital
or to an entity whose primary business is investing in securities; and (d) securities issued to
consultants for services rendered to the Company in non-capital raising transactions in an amount
per individual issuance not to exceed 30,000 shares for particular services rendered.
“GAAP” shall have the meaning ascribed to such term in Section 3.1(h).
“Hunter” means Hunter World Markets, Inc.
“Intellectual Property Rights” shall have the meaning ascribed to such term in Section
3.1(k).
“Legend Removal Date” shall have the meaning ascribed to such term in Section 4.1(c).
“Liens” means a lien, charge, security interest, encumbrance, right of first refusal,
preemptive right or other restriction.
“Material Adverse Effect” shall have the meaning ascribed to such term in Section
3.1(b).
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“Material Permits” shall have the meaning ascribed to such term in Section 3.1(i).
“Per Share Purchase Price” equals $0.75, subject to adjustment for reverse and forward
stock splits, stock dividends, stock combinations and other similar transactions of the Common
Stock that occur after the date of this Agreement.
“Person” means an individual or corporation, partnership, trust, incorporated or
unincorporated association, joint venture, limited liability company, joint stock company,
government (or an agency or subdivision thereof) or other entity of any kind.
“Placement Agent Agreement” means that certain Placement Agent Agreement between the
Company and Hunter.
“Placement Agent Warrants” means those warrants to be issued to Hunter further to the
Placement Agent Agreement.
“Proceeding” means an action, claim, suit, investigation or proceeding (including,
without limitation, an investigation or partial proceeding, such as a deposition), whether
commenced or threatened.
“Registration Rights Agreement” means the Registration Rights Agreement, dated as of
the date of this Agreement, among the Company and each Purchaser, providing for the registration of
the Shares in the form of Exhibit A attached hereto.
“Registration Statement” means a registration statement meeting the requirements set
forth in the Registration Rights Agreement and covering the resale by the Purchasers of the Shares.
“Required Approvals” shall have the meaning ascribed to such term in Section 3.1(e).
“Rule 144” means Rule 144 promulgated by the Commission pursuant to the Securities
Act, as such Rule may be amended from time to time, or any similar rule or regulation hereafter
adopted by the Commission having substantially the same effect as such Rule.
“Securities Act” means the Securities Act of 1933, as amended.
“Shares” means the shares of the Company’s Common Stock issued or issuable to each
Purchaser pursuant to this Agreement.
“Subscription Amount” means, as to each Purchaser, the amounts set forth below such
Purchaser’s signature block on the signature page hereto, in United States dollars and in
immediately available funds.
“Subsidiary” shall mean the subsidiaries of the Company, if any, set forth on Schedule
3.1(a).
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“Trading Day” means a day on which the Common Stock is traded on a Trading Market.
“Trading Market” means the following markets or exchanges on which the Common Stock is
listed or quoted for trading on the date in question: the American Stock Exchange, the New York
Stock Exchange, the Nasdaq National Market, the Nasdaq SmallCap Market or the OTC Bulletin Board.
“Transaction Documents” means this Agreement, the Registration Rights Agreement, the
Placement Agent Warrants and any other documents or agreements executed in connection with the
transactions contemplated hereunder.
ARTICLE II
PURCHASE AND SALE
PURCHASE AND SALE
2.1 Closing. On the Closing Date, each Purchaser shall purchase from the Company,
severally and not jointly with the other Purchasers, and the Company shall issue and sell to each
Purchaser, a number of Shares equal to such Purchaser’s Subscription Amount divided by the Per
Share Purchase Price. Upon satisfaction of the conditions set forth in Section 2.3, the Closing
shall occur at the offices of Xxxx & Xxxxx, located at 0000 Xxxxxxx Xxxx Xxxx, 00xx
Xxxxx, Xxx Xxxxxxx, Xxxxxxxxxx 00000, or such other location as the parties shall mutually agree.
The aggregate Subscription Amounts for the Shares sold hereunder shall be up to $5,150,000.
Notwithstanding the foregoing, the payment of the aggregate Subscription Amounts and disbursement
of funds shall be through an escrow with Xxxxx Fargo Bank, Los Angeles, California or such other
escrow agent as Hunter approves (the “Escrow Agent”). The Company and each Purchaser acknowledge
and agree that $150,000 of the Subscription Amount for the Shares results from the conversion of
the issuance of that certain Term Note in the principal amount of $150,000 by and between the
Company as Borrower and The Hunter Fund Limited as payee pursuant to that certain Term Credit
Agreement dated October 13, 2005 by and between the Company and The Hunter Fund Limited.
2.2 Deliveries.
(a) On the Closing Date, the Company shall deliver or cause to be delivered to each Purchaser
or Hunter, as the case may be the following:
(i) this Agreement duly executed by the Company;
(ii) a copy of the irrevocable instructions to the Company’s transfer agent instructing the
transfer agent to deliver, on an expedited basis, a certificate evidencing a number of Common
Shares equal to such Purchaser’s Subscription Amount divided by the Per Share Purchase Price,
registered in the name of such Purchaser;
(iii) the Placement Agent Warrants;
(iv) the Registration Rights Agreement duly executed by the Company; and
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(v) an executed Lock-Up Agreement in the form attached hereto as Annex B from each of
Xxxxxxx From and Peyton, Chandler & Xxxxxxxx, Inc.
(b) On the Closing Date, each Purchaser shall deliver or cause to be delivered to the Company
the following:
(i) this Agreement duly executed by such Purchaser;
(ii) such Purchaser’s Subscription Amount by wire transfer of same day funds to the account as
specified in writing by the Escrow Agent; and
(iii) the Registration Rights Agreement duly executed by such Purchaser.
2.3 Closing Conditions.
(a) The obligations of the Company hereunder in connection with the Closing are subject to the
following conditions being met:
(i) the accuracy in all material respects when made and on the Closing Date of the
representations and warranties of the Purchasers contained herein;
(ii) all obligations, covenants and agreements of the Purchasers required to be performed at
or prior to the Closing Date shall have been performed; and
(iii) the delivery by the Purchasers of the items set forth in Section 2.2(b) of this
Agreement.
(b) The respective obligations of the Purchasers hereunder in connection with the Closing are
subject to the following conditions being met:
(i) the accuracy in all material respects on the Closing Date of the representations and
warranties of the Company contained herein;
(ii) all obligations, covenants and agreements of the Company required to be performed at or
prior to the Closing Date shall have been performed;
(iii) the delivery by the Company of the items set forth in Section 2.2(a) of this Agreement;
(iv) there shall have been no Material Adverse Effect with respect to the Company since the
date hereof;
(v) the Company shall have in force a Lock-Up Agreement in the form attached hereto as
Annex B from each of Xxxxxxx From and Peyton, Chandler & Xxxxxxxx, Inc.; and
(vi) The Purchasers shall have received an opinion of counsel to the Company in form and
substance reasonably satisfactory to the Purchasers.
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ARTICLE III
REPRESENTATIONS AND WARRANTIES
REPRESENTATIONS AND WARRANTIES
3.1 Representations and Warranties of the Company. Except as set forth under the
corresponding section of the Disclosure Schedules which Disclosure Schedules shall be deemed a part
hereof, the Company hereby makes the representations and warranties set forth below to each
Purchaser:
(a) Subsidiaries. All of the direct and indirect subsidiaries of the Company, if any,
are set forth on Schedule 3.1(a). The Company owns, directly or indirectly, all of the capital
stock or other equity interests of each Subsidiary free and clear of any Liens, and all the issued
and outstanding shares of capital stock of each Subsidiary are validly issued and are fully paid,
non-assessable and free of preemptive and similar rights to subscribe for or purchase securities.
If the Company has no subsidiaries, then references in the Transaction Documents to the
Subsidiaries will be disregarded.
(b) Organization and Qualification. Each of the Company and the Subsidiaries is an
entity duly incorporated or otherwise organized, validly existing and in good standing under the
laws of the jurisdiction of its incorporation or organization (as applicable), with the requisite
power and authority to own and use its properties and assets and to carry on its business as
currently conducted. Neither the Company nor any Subsidiary is in violation or default of any of
the provisions of its respective certificate or articles of incorporation, bylaws or other
organizational or charter documents. Each of the Company and the Subsidiaries is duly qualified to
conduct business and is in good standing as a foreign corporation or other entity in each
jurisdiction in which the nature of the business conducted or property owned by it makes such
qualification necessary, except where the failure to be so qualified or in good standing, as the
case may be, could not have or reasonably be expected to result in (i) a material adverse effect on
the legality, validity or enforceability of any Transaction Documents, (ii) a material adverse
effect on the results of operations, assets, business, prospects or financial condition of the
Company and the Subsidiaries, taken as a whole, or (iii) a material adverse effect on the Company’s
ability to perform in any material respect on a timely basis its obligations under any Transaction
Documents (any of (i), (ii) or (iii), a “Material Adverse Effect”) and no Proceeding has been
instituted in any such jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or
curtail such power and authority or qualification.
(c) Authorization; Enforcement. The Company has the requisite corporate power and
authority to enter into and to consummate the transactions contemplated by each of the Transaction
Documents and otherwise to carry out its obligations thereunder. The execution and delivery of
each of the Transaction Documents by the Company and the consummation by it of the transactions
contemplated thereby have been duly authorized by all necessary action on the part of the Company
and no further action is required by the Company in connection therewith other than in connection
with the Required Approvals. Each of the Transaction Documents has been (or upon delivery will
have been) duly executed by the Company and, when delivered in accordance with the terms hereof,
will constitute the valid and binding obligation of the Company enforceable against the Company in
accordance with its terms except (i) as limited by applicable bankruptcy, insolvency,
reorganization, moratorium and other laws of general application affecting enforcement of
creditors’ rights generally, (ii) as limited by laws relating to
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the availability of specific performance, injunctive relief or other equitable remedies and
(iii) insofar as indemnification and contribution provisions may be limited by applicable law.
(d) No Conflicts. The execution, delivery and performance of the Transaction
Documents by the Company, the issuance and sale of the Shares and the consummation by the Company
of the other transactions contemplated thereby do not and will not (i) conflict with or violate any
provision of the Company’s or any Subsidiary’s certificate or articles of incorporation, bylaws or
other organizational or charter documents, or (ii) conflict with, or constitute a default (or an
event that with notice or lapse of time or both would become a default) under, result in the
creation of any Lien upon any of the properties or assets of the Company or any Subsidiary, or give
to others any rights of termination, amendment, acceleration or cancellation (with or without
notice, lapse of time or both) of, any agreement, credit facility, debt or other instrument
(evidencing a Company or Subsidiary debt or otherwise) or other understanding to which the Company
or any Subsidiary is a party or by which any property or asset of the Company or any Subsidiary is
bound or affected, or (iii) subject to the Required Approvals, conflict with or result in a
violation of any law, rule, regulation, order, judgment, injunction, decree or other restriction of
any court or governmental authority to which the Company or a Subsidiary is subject (including
federal and state securities laws and regulations), or by which any property or asset of the
Company or a Subsidiary is bound or affected; except in the case of each of clauses (ii) and (iii),
such as could not have or reasonably be expected to result in a Material Adverse Effect.
(e) Filings, Consents and Approvals. The Company is not required to obtain any
consent, waiver, authorization or order of, give any notice to, or make any filing or registration
with, any court or other federal, state, local or other governmental authority or other Person in
connection with the execution, delivery and performance by the Company of the Transaction
Documents, other than (i) filings required pursuant to Section 4.4 of this Agreement, (ii) the
filing with the Commission of the Registration Statement, (iii) application(s) to each applicable
Trading Market for the listing of the Common Shares for trading thereon in the time and manner
required thereby, and (iv) the filing of Form D with the Commission and such filings as are
required to be made under applicable state securities laws (collectively, the “Required
Approvals”).
(f) Issuance of the Securities. The Shares are duly authorized and, when issued and
paid for in accordance with the Transaction Documents, will be duly and validly issued, fully paid
and nonassessable, free and clear of all Liens imposed by the Company other than restrictions on
transfer provided for in the Transaction Documents. The Company has reserved from its duly
authorized capital stock the maximum number of shares of Common Stock issuable pursuant to this
Agreement.
(g) Capitalization. The authorized capital stock of the Company consists of
100,000,000 shares of common stock, $.001 par value per share, and 50,000,000 shares of preferred
stock, $.001 par value per share. As of the date hereof, there were 18,611,361 shares of common
stock outstanding, 36,978 shares held as Treasury Stock and 1,500,000 shares held in escrow and no
shares of preferred stock outstanding. In addition, there were outstanding options and warrants to
purchase 4,299,823 shares of common stock and an option to purchase 588,428 shares issuable
pursuant to the exercise of anti-dilution rights granted to purchasers in the August
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2005 Securities Purchase Agreement. All of the outstanding shares of capital stock of the
Company are validly issued, fully paid and nonassessable, have been issued in compliance with all
federal and state securities laws, and none of such outstanding shares was issued in violation of
any preemptive rights or similar rights to subscribe for or purchase securities. No further
approval or authorization of any stockholder, the Board of Directors of the Company or others is
required for the issuance and sale of the Shares. There are no stockholders agreements, voting
agreements or other similar agreements with respect to the Company’s capital stock to which the
Company is a party or, to the knowledge of the Company, between or among any of the Company’s
stockholders.
(h) Material Changes. Since September 30, 2005, (i) the Company has not incurred any
liabilities (contingent or otherwise) other than (A) trade payables and accrued expenses incurred
in the ordinary course of business consistent with past practice and (B) liabilities not required
to be reflected in the Financial Statements (as defined below) pursuant to GAAP, and (C) a bridge
loan to the Company in the amount of $150,000 from Hunter (ii) the Company has not altered its
method of accounting, and (iii) the Company has not declared or made any dividend or distribution
of cash or other property to its stockholders or purchased, redeemed or made any agreements to
purchase or redeem any shares of its capital stock.
(i) Litigation. There is no action, suit, inquiry, notice of violation, proceeding or
investigation pending or, to the knowledge of the Company, threatened against or affecting the
Company, any Subsidiary or any of their respective properties before or by any court, arbitrator,
governmental or administrative agency or regulatory authority (federal, state, county, local or
foreign) (collectively, an “Action”) which (i) adversely affects or challenges the legality,
validity or enforceability of any of the Transaction Documents or the Shares or (ii) could, if
there were an unfavorable decision, have or reasonably be expected to result in a Material Adverse
Effect. Neither the Company nor any Subsidiary, nor any current director or officer thereof, is or
has been the subject of any Action involving a claim of violation of or liability under federal or
state securities laws or a claim of breach of fiduciary duty. There has not been, and to the
knowledge of the Company, there is not pending or contemplated, any investigation by the Commission
involving the Company or any current director or officer of the Company.
(j) Permits. The Company and the Subsidiaries possess all certificates,
authorizations and permits issued by the appropriate federal, state, local or foreign regulatory
authorities necessary to conduct their respective businesses, except where the failure to possess
such permits could not have or reasonably be expected to result in a Material Adverse Effect
(“Material Permits”), and neither the Company nor any Subsidiary has received any notice of
proceedings relating to the revocation or modification of any Material Permit.
(k) Patents and Trademarks. The Company and the Subsidiaries have, or have rights to
use, all patents, patent applications, trademarks, trademark applications, service marks, trade
names, copyrights, licenses and other similar rights necessary or material for use in connection
with their respective businesses and which the failure to so have could have a Material Adverse
Effect (collectively, the “Intellectual Property Rights”). Neither the Company nor any Subsidiary
has received a written notice that the Intellectual Property Rights used by the Company or any
Subsidiary violates or infringes upon the rights of any Person. To the
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knowledge of the Company, all such Intellectual Property Rights are enforceable and there is
no existing infringement by another Person of any of the Intellectual Property Rights of others.
(l) Certain Fees. Except for placement agent fees to Hunter, no brokerage or finder’s
fees or commissions are or will be payable by the Company to any broker, financial advisor or
consultant, finder, placement agent, investment banker, bank or other Person with respect to the
transactions contemplated by this Agreement. The Purchasers shall have no obligation with respect
to any fees or with respect to any claims made by or on behalf of other Persons for fees of a type
contemplated in this Section that may be due in connection with the transactions contemplated by
this Agreement.
(m) Private Placement. Assuming the accuracy of the Purchasers’ representations and
warranties set forth in Section 3.2, no registration under the Securities Act is required for the
offer and sale of the Shares by the Company to the Purchasers as contemplated hereby. Neither the
Company nor any person acting on behalf of the Company has offered or sold any of the Shares by any
form of general solicitation or general advertising. The Company has offered the Shares for sale
only to the Purchasers and certain other “accredited investors” within the meaning of Rule 501
under the Securities Act.
(n) Investment Company. The Company is not, and is not an Affiliate of, and
immediately after receipt of payment for the Shares, will not be or be an Affiliate of, an
“investment company” within the meaning of the Investment Company Act of 1940, as amended. The
Company shall conduct its business in a manner so that it will not become subject to the Investment
Company Act.
(o) Registration Rights. No Person has any right to cause the Company to effect the
registration under the Securities Act of any securities of the Company.
(p) Financial Statements. The Company has made available to the Purchasers its (a)
audited balance sheets as at December 31, 2003 and 2004 and related statements of operations,
changes in stockholders equity and cash flows for the years ended December 31, 2004 and 2003, and
(b) unaudited balance sheets as at September 30, 2005 and the related statement of operations,
changes in stockholders equity and cash flows for the nine months ended September 30, 2005
(collectively, the “Financial Statements”). The Financial Statements (i) were in accordance with
the books and records of the Company, (ii) are correct and complete, (iii) fairly present the
financial position and results of operations of the Company as of the dates indicated, and (iv) are
prepared in accordance with U.S. GAAP (except that (x) unaudited financial statements may not be in
accordance with GAAP because of the absence of footnotes normally contained therein, and (y)
interim (unaudited) financials are subject to normal year-end audit adjustments that in the
aggregate will not have a material adverse effect on the Company or its business, financial
conditions or results of operations).
3.2 Representations and Warranties of the Purchasers. Each Purchaser hereby, for
itself and for no other Purchaser, represents and warrants as of the date hereof and as of the
Closing Date to the Company as follows:
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(a) Organization; Authority. Such Purchaser is an entity duly organized, validly
existing and in good standing under the laws of the jurisdiction of its organization with full
right, corporate or partnership power and authority to enter into and to consummate the
transactions contemplated by the Transaction Documents and otherwise to carry out its obligations
thereunder. The execution, delivery and performance by such Purchaser of the transactions
contemplated by this Agreement have been duly authorized by all necessary corporate or similar
action on the part of such Purchaser. Each of the Transaction Documents to which it is a party has
been duly executed by such Purchaser, and when delivered by such Purchaser in accordance with the
terms hereof, will constitute the valid and legally binding obligation of such Purchaser,
enforceable against it in accordance with its terms, except (i) as limited by general equitable
principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of
general application affecting enforcement of creditors’ rights generally, (ii) as limited by laws
relating to the availability of specific performance, injunctive relief or other equitable remedies
and (iii) insofar as indemnification and contribution provisions may be limited by applicable law.
(b) Investment Intent. Such Purchaser understands that the Shares are “restricted
securities” and have not been registered under the Securities Act or any applicable state
securities law and is acquiring the Shares as principal for its own account and not with a view to
or for distributing or reselling such Shares or any part thereof, has no present intention of
distributing any of such Shares and has no arrangement or understanding with any other persons
regarding the distribution of such Shares (this representation and warranty not limiting such
Purchaser’s right to sell the Shares pursuant to the Registration Statement or otherwise in
compliance with applicable federal and state securities laws). Such Purchaser is acquiring the
Shares hereunder in the ordinary course of its business. Such Purchaser does not have any
agreement or understanding, directly or indirectly, with any Person to distribute any of the
Shares.
(c) Purchaser Status. At the time such Purchaser was offered the Shares, it was, and
at the date hereof it is, (i) an “accredited investor” as defined in Rule 501(a)(1), (a)(2),
(a)(3), (a)(7) or (a)(8) under the Securities Act or (ii) a “qualified institutional buyer” as
defined in Rule 144A(a) under the Securities Act. Such Purchaser is not required to be registered
as a broker-dealer under Section 15 of the Exchange Act.
(d) Experience of Such Purchaser. Such Purchaser, either alone or together with its
representatives, has such knowledge, sophistication and experience in business and financial
matters so as to be capable of evaluating the merits and risks of the prospective investment in the
Shares, and has so evaluated the merits and risks of such investment. Such Purchaser is able to
bear the economic risk of an investment in the Shares and, at the present time, is able to afford a
complete loss of such investment.
(e) General Solicitation. Such Purchaser is not purchasing the Shares as a result of
any advertisement, article, notice or other communication regarding the Shares published in any
newspaper, magazine or similar media or broadcast over television or radio or presented at any
seminar or any other general solicitation or general advertisement.
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ARTICLE IV
OTHER AGREEMENTS OF THE PARTIES
OTHER AGREEMENTS OF THE PARTIES
4.1 Transfer Restrictions.
(a) The Shares may only be disposed of in compliance with state and federal securities laws.
In connection with any transfer of the Securities other than pursuant to an effective registration
statement or Rule 144, to the Company or to an affiliate of a Purchaser or in connection with a
pledge as contemplated in Section 4.1(b), the Company may require the transferor thereof to provide
to the Company an opinion of counsel selected by the transferor and reasonably acceptable to the
Company, the form and substance of which opinion shall be reasonably satisfactory to the Company,
to the effect that such transfer does not require registration of such transferred Securities under
the Securities Act. As a condition of transfer, any such transferee shall agree in writing to be
bound by the terms of this Agreement and shall have the rights of a Purchaser under this Agreement
and the Registration Rights Agreement.
(b) The Purchasers agree to the imprinting, so long as is required by this Section 4.1(b), of
a legend on any of the Shares in the following form:
THESE SECURITIES HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR
PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO,
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH
APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL
TO THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY
ACCEPTABLE TO THE COMPANY. THESE SECURITIES MAY BE PLEDGED IN CONNECTION
WITH A BONA FIDE MARGIN ACCOUNT WITH A REGISTERED BROKER-DEALER OR OTHER
LOAN WITH A FINANCIAL INSTITUTION THAT IS AN “ACCREDITED INVESTOR” AS
DEFINED IN RULE 501(a) UNDER THE SECURITIES ACT.
The Company acknowledges and agrees that a Purchaser may from time to time pledge pursuant to
a bona fide margin agreement with a registered broker-dealer or grant a security interest in some
or all of the Shares to a financial institution that is an “accredited investor” as defined in Rule
501(a) under the Securities Act and who agrees to be bound by the provisions of this Agreement and
the Registration Rights Agreement and, if required under the terms of such arrangement, such
Purchaser may transfer pledged or secured Shares to the pledgees or secured parties. Such a pledge
or transfer would not be subject to approval of the Company and no legal
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opinion of legal counsel of the pledgee, secured party or pledgor shall be required in
connection therewith. Further, no notice shall be required of such pledge. At the appropriate
Purchaser’s expense, the Company will execute and deliver such reasonable documentation as a
pledgee or secured party of Shares may reasonably request in connection with a pledge or transfer
of the Shares, including, if the Shares are subject to registration pursuant to the Registration
Rights Agreement, the preparation and filing of any required prospectus supplement under Rule
424(b)(3) under the Securities Act or other applicable provision of the Securities Act to
appropriately amend the list of Selling Stockholders thereunder.
(c) Certificates evidencing the Shares shall not contain any legend (including the legend set
forth in Section 4.1(b)), (i) while a registration statement (including the Registration Statement)
covering the resale of such security is effective under the Securities Act provided that at the
time a Purchaser requests a removal of the legend on any certificate evidencing all or any portion
of any of the Shares, such Purchaser (or a broker acting on such Purchaser’s behalf) provides to
the Company (or to the transfer agent on the Company’s behalf), a representation that any of the
Shares, sold or to be sold by such Purchaser have been, or will be, sold in accordance with the
plan of distribution set forth in the Prospectus and in compliance with the prospectus delivery
requirements under the Securities Act, or (ii) following any sale of such Shares pursuant to Rule
144, or (iii) if such Shares are eligible for sale under Rule 144(k), or (iv) if such legend is not
required under applicable requirements of the Securities Act (including judicial interpretations
and pronouncements issued by the Staff of the Commission). The Company agrees that following the
Effective Date or at such time as such legend is no longer required under this Section 4.1(c), it
will, no later than three Trading Days following the delivery by a Purchaser to the Company or the
Company’s transfer agent of a certificate representing Shares issued with a restrictive legend
(such date, the “Legend Removal Date”), deliver or cause to be delivered to such Purchaser a
certificate representing such Shares that is free from all restrictive and other legends. The
Company may not make any notation on its records or give instructions to any transfer agent of the
Company that enlarge the restrictions on transfer set forth in this Section.
(d) Each Purchaser, severally and not jointly with the other Purchasers, agrees that the
removal of the restrictive legend from certificates representing Shares as set forth in this
Section 4.1 is predicated upon the Company’s reliance that the Purchaser will sell any Shares
pursuant to either the registration requirements of the Securities Act, including any applicable
prospectus delivery requirements, or an exemption therefrom.
4.2 Furnishing of Information. As long as any Purchaser owns Shares, the Company will
use best efforts to timely file (or obtain extensions in respect thereof and file within the
applicable grace period) all reports required to be filed by the Company after the date hereof
pursuant to the Exchange Act. As long as any Purchaser owns Shares, if the Company is not required
to file reports pursuant to the Exchange Act, it will prepare and furnish to the Purchasers and
make publicly available in accordance with Rule 144(c) such information as is required for the
Purchasers to sell the Shares under Rule 144. The Company further covenants that it will take such
further action as any holder of Shares may reasonably request, all to the extent required from time
to time to enable such Person to sell such Shares without registration under the Securities Act
within the limitation of the exemptions provided by Rule 144.
12
4.3 Integration. The Company shall not sell, offer for sale or solicit offers to buy
or otherwise negotiate in respect of any security (as defined in Section 2 of the Securities Act)
that would be integrated with the offer or sale of the Shares in a manner that would require the
registration under the Securities Act of the sale of the Shares to the Purchasers or that would be
integrated with the offer or sale of the Shares for purposes of the rules and regulations of any
Trading Market such that it would require shareholder approval prior to the closing of such other
transaction unless shareholder approval is obtained before the closing of such subsequent
transaction.
4.4 Publicity. The Company, and each Purchaser shall consult with each other in
issuing any other press releases with respect to the transactions contemplated hereby, and neither
the Company, nor any Purchaser shall issue any such press release or otherwise make any such public
statement without the prior consent of the Company, with respect to any press release of any
Purchaser, or without the prior consent of each Purchaser, with respect to any press release of the
Company, which consent shall not unreasonably be withheld, except if such disclosure is required by
law, in which case the disclosing party shall promptly provide the other party with prior notice of
such public statement or communication. Notwithstanding the foregoing, neither the Company shall
publicly disclose the name of any Purchaser, or include the name of any Purchaser in any filing
with the Commission or any regulatory agency or Trading Market, without the prior written consent
of such Purchaser, except (i) as required by federal securities law and (ii) to the extent such
disclosure is required by law or Trading Market regulations.
4.5 Reservation of Common Stock. As of the date hereof, each of the Company has
reserved and the Company shall continue to reserve and keep available at all times, free of
preemptive rights, a sufficient number of shares of Common Stock for the purpose of enabling the
Company to issue the Shares pursuant to this Agreement.
4.6 Equal Treatment of Purchasers. No consideration shall be offered or paid to any
person to amend or consent to a waiver or modification of any provision of any of the Transaction
Documents unless the same consideration is also offered to all of the parties to the Transaction
Documents. For clarification purposes, this provision constitutes a separate right granted to each
Purchaser by the Company and negotiated separately by each Purchaser, and is intended to treat for
the Company the Purchasers as a class and shall not in any way be construed as the Purchasers
acting in concert or as a group with respect to the purchase, disposition or voting of Shares or
otherwise.
4.7 Subsequent Equity Sales. Except for Exempt Issuances, from the date hereof until
the Effective Date, neither the Company nor any Subsidiary shall issue shares of Common Stock or
Common Stock Equivalents.
4.8 Delivery of Shares After Closing. The Company shall deliver, or cause to be
delivered, the respective Shares purchased by each Purchaser to such Purchaser within three Trading
Days of the Closing Date.
4.9 Most Favored Nations. If, at any time and from time to time during the period
commencing on the Closing Date and ending on the first anniversary of the Effective Date, the
Company issues additional shares of Common Stock or Common Stock Equivalents, excluding
13
any Anti-Dilution Shares (the “Additional Shares”) at a price or exercise price per share of
Common Stock (the “Effective Price”) less than Per Share Purchase Price (as adjusted hereunder to
such date), then the Company shall provide notice thereof to the Purchasers, and, within twenty
business days from receipt of such notice, the Purchasers or any of them shall have the right to
purchase additional shares of Common Stock (the “Purchase Shares”) at a purchase price equal to the
par value thereof (the “Purchase Share Price”) in accordance with the following: (a) There shall be
calculated a per share price (the “Adjusted Price”) determined by a fraction, the numerator of
which shall be 19,397,020 PLUS the product of the number of Additional Shares multiplied by the
Effective Price PLUS any prior products of previously issued Additional Shares multiplied by the
applicable Effective Price(s) with respect to such issuances, and the denominator of which shall be
25,862,694 PLUS the number of Additional Shares PLUS any previously issued Additional Shares. (b)
Each Purchaser shall be entitled to purchase that number of Purchase Shares at the Purchase Price
equal to the difference between the product of the total dollars paid by Purchaser for shares of
common stock hereunder (the “Purchaser Amount”) divided by the Adjusted Price LESS the product of
the Purchaser Amount divided by the Per Share Purchase Price. By way of example only, if the
Company issued 4,000,000 Additional Shares at an Effective Price of $.50 per share, and there had
been no previous adjustments further to this Section 4.9, the Adjusted Price would be $.7165
(19,397,020 PLUS 2,000,000 divided by 25,862,694 PLUS 4,000,000). If the Purchaser purchased
$1,000,000 of Common Stock further to this Agreement, he/she/it would be entitled to purchase
62,340 Purchase Shares (1,000,000 divided by .7165 or 1,395,673 shares LESS 1,000,000 divided by
..75 or 1,333,333 shares). Notwithstanding the foregoing, no adjustment will be made in respect of
Exempt Issuances.
4.10 Board Nominee. At each of the next two annual meetings of stockholders where
directors are elected, the Company agrees to place Hunter’s designee on the slate of directors for
nomination to the Board at each such meeting. In addition, the Company agrees to cause a proposal
to be put in front of the Board for its consideration at its next regular meeting in the month of
November 2005 to elect Xxxx Xxxxxx to a vacancy presently existing as of the date hereof on the
Board.
ARTICLE V
MISCELLANEOUS
MISCELLANEOUS
5.1 Termination. This Agreement may be terminated by any Purchaser, by written notice
to the other parties, if the Closing has not been consummated on or before December 31, 2005;
provided that no such termination will affect the right of any party to xxx for any breach by the
other party (or parties).
5.2 Fees and Expenses. The Company shall deliver, prior to the Closing, a completed
and executed copy of the Closing Statement, attached hereto as Annex A. Except as otherwise set
forth in this Agreement or in the Placement Agent Agreement, each party shall pay the fees and
expenses of its advisers, counsel, accountants and other experts, if any, and all other expenses
incurred by such party incident to the negotiation, preparation, execution, delivery and
performance of this Agreement. The Company shall pay all stamp and other taxes and duties levied
in connection with the sale of the Shares.
14
5.3 Entire Agreement. The Transaction Documents, together with the exhibits and
schedules thereto, contain the entire understanding of the parties with respect to the subject
matter hereof and supersede all prior agreements and understandings, oral or written, with respect
to such matters, which the parties acknowledge have been merged into such documents, exhibits and
schedules.
5.4 Notices. Any and all notices or other communications or deliveries required or
permitted to be provided hereunder shall be in writing and shall be deemed given and effective on
the earliest of (a) the date of transmission, if such notice or communication is delivered via
facsimile at the facsimile number set forth on the signature pages attached hereto prior to 6:30
p.m. (New York City time) on a Trading Day, (b) the next Trading Day after the date of
transmission, if such notice or communication is delivered via facsimile at the facsimile number
set forth on the signature pages attached hereto on a day that is not a Trading Day or later than
6:30 p.m. (New York City time) on any Trading Day, (c) the second Trading Day following the date
of mailing, if sent by U.S. nationally recognized overnight courier service, or (d) upon actual
receipt by the party to whom such notice is required to be given. The address for such notices and
communications shall be as set forth on the signature pages attached hereto.
5.5 Amendments; Waivers. No provision of this Agreement may be waived or amended
except in a written instrument signed, in the case of an amendment, by the Company and Purchasers
holding at least 66% of the Shares at such time or, in the case of a waiver, by the party against
whom enforcement of any such waiver is sought. No waiver of any default with respect to any
provision, condition or requirement of this Agreement shall be deemed to be a continuing waiver in
the future or a waiver of any subsequent default or a waiver of any other provision, condition or
requirement hereof, nor shall any delay or omission of either party to exercise any right hereunder
in any manner impair the exercise of any such right.
5.6 Construction. The headings herein are for convenience only, do not constitute a
part of this Agreement and shall not be deemed to limit or affect any of the provisions hereof.
The language used in this Agreement will be deemed to be the language chosen by the parties to
express their mutual intent, and no rules of strict construction will be applied against any party.
5.7 Successors and Assigns. This Agreement shall be binding upon and inure to the
benefit of the parties and their successors and permitted assigns. The Company may not assign this
Agreement or any rights or obligations hereunder without the prior written consent of each
Purchaser. Any Purchaser may assign any or all of its rights under this Agreement to any Person to
whom such Purchaser assigns or transfers any Shares, provided such transferee agrees in writing to
be bound, with respect to the transferred Shares, by the provisions hereof that apply to the
“Purchasers”.
5.8 No Third-Party Beneficiaries. This Agreement is intended for the benefit of the
parties hereto and their respective successors and permitted assigns and is not for the benefit of,
nor may any provision hereof be enforced by, any other Person.
5.9 Governing Law. All questions concerning the construction, validity, enforcement
and interpretation of the Transaction Documents shall be governed by and construed and enforced in
accordance with the internal laws of the State of Delaware, without regard to the
15
principles of conflicts of law thereof. Each party agrees that all legal proceedings
concerning the interpretations, enforcement and defense of the transactions contemplated by this
Agreement and any other Transaction Documents (whether brought against a party hereto or its
respective affiliates, directors, officers, shareholders, employees or agents) shall be commenced
exclusively in the state and federal courts sitting in the City of Los Angeles. Each party hereby
irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in the
City of Los Angeles, for the adjudication of any dispute hereunder or in connection herewith or
with any transaction contemplated hereby or discussed herein (including with respect to the
enforcement of any of the Transaction Documents), and hereby irrevocably waives, and agrees not to
assert in any suit, action or proceeding, any claim that it is not personally subject to the
jurisdiction of any such court, that such suit, action or proceeding is improper or inconvenient
venue for such proceeding. Each party hereby irrevocably waives personal service of process and
consents to process being served in any such suit, action or proceeding by mailing a copy thereof
via registered or certified mail or overnight delivery (with evidence of delivery) to such party at
the address in effect for notices to it under this Agreement and agrees that such service shall
constitute good and sufficient service of process and notice thereof. Nothing contained herein
shall be deemed to limit in any way any right to serve process in any manner permitted by law. The
parties hereby waive all rights to a trial by jury. If either party shall commence an action or
proceeding to enforce any provisions of the Transaction Documents, then the prevailing party in
such action or proceeding shall be reimbursed by the other party for its attorneys’ fees and other
costs and expenses incurred with the investigation, preparation and prosecution of such action or
proceeding.
5.10 Survival. The representations and warranties herein shall survive the Closing
and delivery of the Shares for two years from the date hereof.
5.11 Execution. This Agreement may be executed in two or more counterparts, all of
which when taken together shall be considered one and the same agreement and shall become effective
when counterparts have been signed by each party and delivered to the other party, it being
understood that both parties need not sign the same counterpart. In the event that any signature
is delivered by facsimile transmission, such signature shall create a valid and binding obligation
of the party executing (or on whose behalf such signature is executed) with the same force and
effect as if such facsimile signature page were an original thereof.
5.12 Severability. If any provision of this Agreement is held to be invalid or
unenforceable in any respect, the validity and enforceability of the remaining terms and provisions
of this Agreement shall not in any way be affected or impaired thereby and the parties will attempt
to agree upon a valid and enforceable provision that is a reasonable substitute therefor, and upon
so agreeing, shall incorporate such substitute provision in this Agreement.
5.13 Replacement of Shares. If any certificate evidencing any Shares is mutilated,
lost, stolen or destroyed, the Company shall issue or cause to be issued in exchange and
substitution for and upon cancellation thereof, or in lieu of and substitution therefor, a new
certificate, but only upon receipt of evidence reasonably satisfactory to the Company of such loss,
theft or destruction and customary and reasonable indemnity, if requested. The applicants for a
new certificate under such circumstances shall also pay any reasonable third-party costs associated
with the issuance of such replacement Shares.
16
5.14 Remedies. In addition to being entitled to exercise all rights provided herein
or granted by law, including recovery of damages, each of the Purchasers and the Company will be
entitled to specific performance under the Transaction Documents. The parties agree that monetary
damages may not be adequate compensation for any loss incurred by reason of any breach of
obligations described in the foregoing sentence and hereby agrees to waive in any action for
specific performance of any such obligation the defense that a remedy at law would be adequate.
(Signature Pages Follows)
IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be
duly executed by their respective authorized signatories as of the date first indicated above.
| MICROMED CARDIOVASCULAR, INC. | ||||||
| By: | /s/ Xxxxxx X. Xxxxx | |||||
| Name: | Xxxxxx X. Xxxxx | |||||
| Title: | President and Chief Executive Officer | |||||
| Address for Notice | ||||||
| 0000 Xxxxxxxxxxx Xxxxx | ||||||
| Xxxxxxx XX 00000 | ||||||
with a copy to (which shall not constitute notice):
Xxxxxx X. Xxxxxxx, Esq.
Xxxxxxxxxxx & Xxxxxxxx Xxxxxxxxx Xxxxxx LLP
00000 Xxxxx Xxxxxx Xxxxxxxxx
Xxxxxxx Xxxxx
Xxx Xxxxxxx, XX 00000
Xxxxxxxxxxx & Xxxxxxxx Xxxxxxxxx Xxxxxx LLP
00000 Xxxxx Xxxxxx Xxxxxxxxx
Xxxxxxx Xxxxx
Xxx Xxxxxxx, XX 00000
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
SIGNATURE PAGES FOR PURCHASERS FOLLOW]
SIGNATURE PAGES FOR PURCHASERS FOLLOW]
17
[PURCHASER SIGNATURE PAGES TO MICROMED CARDIOVASCULAR, INC.
SECURITIES PURCHASE AGREEMENT PURCHASE AGREEMENT]
SECURITIES PURCHASE AGREEMENT PURCHASE AGREEMENT]
IN WITNESS WHEREOF, the undersigned have caused this Common Stock Purchase Agreement to be
duly executed by their respective authorized signatories as of the date first indicated above.
| INVESTING ENTITY | ||||||
| ABSOLUTE RETURN EUROPE FUND | ||||||
| By: /s/ Xxxxxxx Xxxx | ||||||
| Name: Xxxxxxx Xxxx | ||||||
| Title: Investment Advisor | ||||||
| Address for Notice of Investing Party: | ||||||
| c/o Xxxx Xxxxxx | ||||||
| Xxxxxx World Markets, Inc. | ||||||
| 0000 Xxxxxxxx Xxxx. | ||||||
| Xxxxxxxxx Xxxxx | ||||||
| Xxxxxxx Xxxxx, XX 00000 | ||||||
With a copy to (which shall not constitute
notice):
Xxxxx X. Xxxxxxxx
Xxxx & Xxxxx
0000 Xxxxxxx Xxxx Xxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Xxxx & Xxxxx
0000 Xxxxxxx Xxxx Xxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Address for Delivery of Securities for
Investing Entity (if not same as above):
Investing Entity (if not same as above):
Subscription Amount: |
$2,000,000 | |||
Shares: |
2,666,667 shares of Common Stock | |||
EIN Number: |
||||
[SIGNATURE PAGES CONTINUE]
18
[PURCHASER SIGNATURE PAGES TO MICROMED CARDIOVASCULAR, INC.
SECURITIES PURCHASE AGREEMENT PURCHASE AGREEMENT]
SECURITIES PURCHASE AGREEMENT PURCHASE AGREEMENT]
IN WITNESS WHEREOF, the undersigned have caused this Common Stock Purchase Agreement to be
duly executed by their respective authorized signatories as of the date first indicated above.
| INVESTING ENTITY | ||||||
| EUROPEAN CATALYST FUND | ||||||
| By: | /s/ Xxxxxxx Xxxx | |||||
| Name: Xxxxxxx Xxxx | ||||||
| Title: Investment Advisor | ||||||
| Address for Notice of Investing Party: | ||||||
| c/o Xxxx Xxxxxx | ||||||
| Xxxxxx World Markets, Inc. | ||||||
| 0000 Xxxxxxxx Xxxx. | ||||||
| Xxxxxxxxx Xxxxx | ||||||
| Xxxxxxx Xxxxx, XX 00000 | ||||||
With a copy to (which shall not constitute
notice):
Xxxxx X. Xxxxxxxx
Xxxx & Xxxxx
0000 Xxxxxxx Xxxx Xxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Xxxx & Xxxxx
0000 Xxxxxxx Xxxx Xxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Address for Delivery of Securities for
Investing Entity (if not same as above):
Investing Entity (if not same as above):
Subscription Amount: |
$2,200,000 | |||
Shares: |
2,933,333 shares of Common Stock | |||
EIN Number: |
||||
[SIGNATURE PAGES CONTINUE]
19
[PURCHASER SIGNATURE PAGES TO MICROMED CARDIOVASCULAR, INC.
SECURITIES PURCHASE AGREEMENT PURCHASE AGREEMENT]
SECURITIES PURCHASE AGREEMENT PURCHASE AGREEMENT]
IN WITNESS WHEREOF, the undersigned have caused this Common Stock Purchase Agreement to be
duly executed by their respective authorized signatories as of the date first indicated above.
| INVESTING ENTITY | ||||||
| ABSOLUTE OCTANE FUND | ||||||
| By: | /s/ Xxxxxxx Xxxx | |||||
| Name: Xxxxxxx Xxxx | ||||||
| Title: Investment Advisor | ||||||
| Address for Notice of Investing Party: | ||||||
| c/o Xxxx Xxxxxx | ||||||
| Xxxxxx World Markets, Inc. | ||||||
| 0000 Xxxxxxxx Xxxx. | ||||||
| Xxxxxxxxx Xxxxx | ||||||
| Xxxxxxx Xxxxx, XX 00000 | ||||||
With a copy to (which shall not constitute
notice):
Xxxxx X. Xxxxxxxx
Xxxx & Xxxxx
0000 Xxxxxxx Xxxx Xxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Xxxx & Xxxxx
0000 Xxxxxxx Xxxx Xxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Address for Delivery of Securities for
Investing Entity (if not same as above):
Investing Entity (if not same as above):
Subscription Amount: |
$400,000 | |||
Shares: |
533,333 shares of Common Stock | |||
EIN Number: |
||||
[SIGNATURE PAGES CONTINUE]
20
[PURCHASER SIGNATURE PAGES TO MICROMED CARDIOVASCULAR, INC.
SECURITIES PURCHASE AGREEMENT PURCHASE AGREEMENT]
SECURITIES PURCHASE AGREEMENT PURCHASE AGREEMENT]
IN WITNESS WHEREOF, the undersigned have caused this Common Stock Purchase Agreement to be
duly executed by their respective authorized signatories as of the date first indicated above.
| INVESTING ENTITY | ||||||
| ABSOLUTE GERMAN FUND | ||||||
| By: | /s/ Xxxxxxx Xxxx | |||||
| Name: Xxxxxxx Xxxx | ||||||
| Title: Investment Advisor | ||||||
| Address for Notice of Investing Party: | ||||||
| c/o Xxxx Xxxxxx | ||||||
| Xxxxxx World Markets, Inc. | ||||||
| 0000 Xxxxxxxx Xxxx. | ||||||
| Xxxxxxxxx Xxxxx | ||||||
| Xxxxxxx Xxxxx, XX 00000 | ||||||
With a copy to (which shall not constitute
notice):
Xxxxx X. Xxxxxxxx
Xxxx & Xxxxx
0000 Xxxxxxx Xxxx Xxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Xxxx & Xxxxx
0000 Xxxxxxx Xxxx Xxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Address for Delivery of Securities for
Investing Entity (if not same as above):
Investing Entity (if not same as above):
Subscription Amount: |
$400,000 | |||
Shares: |
533,333 shares of Common Stock | |||
EIN Number: |
||||
[SIGNATURE PAGES CONTINUE]
21
[PURCHASER SIGNATURE PAGES TO MICROMED CARDIOVASCULAR, INC.
SECURITIES PURCHASE AGREEMENT PURCHASE AGREEMENT]
SECURITIES PURCHASE AGREEMENT PURCHASE AGREEMENT]
IN WITNESS WHEREOF, the undersigned have caused this Common Stock Purchase Agreement to be
duly executed by their respective authorized signatories as of the date first indicated above.
| INVESTING ENTITY | ||||||
| THE HUNTER FUND LTD | ||||||
| By: | /s/ Xxxx X. Xxxxxx | |||||
| Name: Xxxx Xxxxxx | ||||||
| Title: Investment Advisor | ||||||
| Email Address: xxxxxxx@xxxxxxxxx.xxx | ||||||
| Address for Notice of Investing Party: | ||||||
| c/o Xxxx Xxxxxx | ||||||
| Xxxxxx World Markets, Inc. | ||||||
| 0000 Xxxxxxxx Xxxx. | ||||||
| Xxxxxxxxx Xxxxx | ||||||
| Xxxxxxx Xxxxx, XX 00000 | ||||||
With a copy to (which shall not constitute
notice):
Xxxxx X. Xxxxxxxx
Xxxx & Xxxxx
0000 Xxxxxxx Xxxx Xxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Xxxx & Xxxxx
0000 Xxxxxxx Xxxx Xxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Address for Delivery of Securities for
Investing Entity (if not same as above):
Investing Entity (if not same as above):
Subscription Amount: |
$200,000 | |||
Shares: |
150,000 shares of Common Stock | |||
EIN Number: |
||||
22
ANNEX A
CLOSING STATEMENT
Pursuant to the attached Securities Purchase Agreement, dated as of the date hereto, the
purchasers shall purchase up to $5,000,000 of Shares from MicroMed Cardiovascular, Inc., a Delaware
corporation (the “Company”). All funds will be wired into an escrow account. All funds will be
disbursed in accordance with this Closing Statement.
Disbursement Date: November 29, 2005
| I. | PURCHASE PRICE | |||||||||
| Gross Proceeds to be Received in Trust | $ | 5,000,000 | ||||||||
| II. | DISBURSEMENTS | |||||||||
| Payee: | MicroMed Cardiovascular, Inc. | $ | 4,465,000 | |||||||
| 0000 Xxxxxxxxxxx Xxxxx | ||||||||||
| Xxxxxxx XX 00000 | ||||||||||
| ABA#: 000000000 | ||||||||||
| Acct.#: 3300362576 | ||||||||||
| Payee: | Hunter World Markets, Inc. | $ | 525,000 | |||||||
| 0000 Xxxxxxxx Xxxx., Xxx. Xxxxxxxxx | ||||||||||
| Xxxxxxx Xxxxx, XX 00000 | ||||||||||
| ABA#: 000000000 | ||||||||||
| Acct.#: 20601 66768 | ||||||||||
| Payee: | Xxxx & Xxxxx PC | $ | 10,000 | |||||||
| U.S. Bank | ||||||||||
| 0000 Xxxxxxxx Xxxxxxxxx | ||||||||||
| Xxxxxxx Xxxxx, Xxxxxxxxxx 00000 | ||||||||||
| Xxxx & Xxxxx Trust Account | ||||||||||
| Routing No.: 0-000-00000 | ||||||||||
| Acct.#.: 164301242180 | ||||||||||
| Total Amount Disbursed: | $ | 5,000,000 | ||||||||
23
Schedule of Purchasers
| Purchaser’s Name | Share Amount | Purchase Amount | ||||||
Absolute Return Europe |
2,666,667 | $ | 2,000,000 | |||||
European Catalyst Fund |
2,933,333 | $ | 2,200,000 | |||||
Absolute Octane Fund |
533,333 | $ | 400,000 | |||||
Absolute German Fund |
533,333 | $ | 400,000 | |||||
The Hunter Fund Ltd. |
200,000 | $ | 150,000 | |||||
TOTAL: |
6,866,666 | $ | 5,150,000 | |||||
24
