SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
VISION TWENTY-ONE, INC.
-----------------------
(Name of Issuer)
Common Stock, $.01 par value
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(Title of Class of Securities)
92831N 10 1
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(CUSIP Number)
Gregory L. Wilson
Chief Financial Officer
LaserSight Incorporated
12161 Lackland Road
St. Louis, Missouri 63146
(314) 576-1563
Copy to:
Sonnenschein Nath & Rosenthal
One Metropolitan Square
Suite 3000
St. Louis, Missouri 63102
(314) 241-1800
Attn: Timothy L. Elliott, Esq.
J. Timothy Gorman, Esq.
----------------------------------------
(Name, Address and Telephone Number of Persons
Authorized to Receive Notices and Communications)
December 30, 1997
-----------------------------
(Date of Event which Requires
Filing of this Statement)
<PAGE>
CUSIP No. 92831N 10 1 13D Page 2 of 11 Pages
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box [ ]
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act.
(Continued on following page(s))
Exhibit Index at Page 9
<PAGE>
CUSIP No. 92831N 10 1 13D Page 3 of 11 Pages
1. NAME OF REPORTING PERSON LASERSIGHT INCORPORATED
S.S. OR I.R.S. IDENTIFICATION NO. 65-0273162
2. CHECK THE APPROPRIATE BOX (a) [ ]
IF A MEMBER OF A GROUP (b) [X]
3. SEC USE ONLY
4. SOURCE OF FUNDS OO
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS
IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e) [ ]
6. CITIZENSHIP OR PLACE OF ORGANIZATION Delaware Corporation
- -------------------------------------
NUMBER OF 7. SOLE VOTING POWER 820,085
SHARES
8. SHARED VOTING POWER -0-
BENEFICIALLY
OWNED BY EACH 9. SOLE DISPOSITIVE POWER 820,085
REPORTING
10. SHARED DISPOSITIVE POWER -0-
PERSON WITH
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 820,085
12. CHECK BOX IF THE AGGREGATE AMOUNT
IN ROW (11) EXCLUDES CERTAIN SHARES [ ]
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 6.5%
14. TYPE OF REPORTING PERSON CO
<PAGE>
CUSIP No. 92831N 10 1 13D Page 4 of 11 Pages
Item 1. Security and Issuer
This statement relates to the Common Stock, $.01 par value (the
"Shares"), of Vision Twenty-One, Inc., a Florida corporation ("Vision 21").
Vision 21's principal executive offices are located at 7209 Bryan Dairy Road,
Largo, Florida 33777.
Item 2. Identity and Background
This statement is filed by LaserSight Incorporated, a Delaware
corporation ("LaserSight"). LaserSight and its subsidiaries operate in two major
operating segments: technology and health care services. The technology segment
of LaserSight's operations includes LaserSight Technologies, Inc. and related
subsidiaries. These entities develop, manufacture and market ophthalmic lasers
with a galvanometric scanning system primarily for use in performing
photorefractive keratectomy. In addition, they license and hold title to various
patents related to the use of excimer lasers to ablate biological tissue and
related to keratome design and usage. Since December 31, 1997, the health care
services segment has consisted of MRF, Inc., d/b/a The Farris Group. The Farris
Group provides consulting health care and vision care services to hospitals,
managed care companies and physicians. The address of the principal business and
principal office of LaserSight is 12161 Lackland Road, St. Louis, Missouri
63146.
Information responsive to Items 2(a), 2(b), 2(c) and 2(f) of Schedule
13D in respect of LaserSight is set forth in Annex I to this Schedule 13D and is
incorporated herein by this reference.
During the last five years, neither LaserSight nor, to its knowledge,
any of its executive officers or directors (i) has been convicted in any
criminal proceeding (excluding traffic violations or similar misdemeanors), or
(ii) has been a party to any civil proceeding of a judicial or administrative
body of competent jurisdiction and as a result of such proceeding was or is
subject to a judgment, decree or final order enjoining future violations of, or
prohibiting or mandating activities subject to, federal or state securities laws
or any violation with respect to such laws.
Item 3. Source and Amount of Funds or Other Consideration
LaserSight received 820,085 of Vision 21's Shares (the "Vision 21
Shares") in exchange for all of the outstanding capital stock of its MEC Health
Care, Inc., a Maryland corporation ("MEC"), subsidiary and its LSI Acquisition,
Inc., a New Jersey corporation ("LSIA"), subsidiary. Such exchange was pursuant
to the terms and conditions of the Stock Purchase Agreement described in item 6
below.
<PAGE>
CUSIP No. 92831N 10 1 13D Page 5 of 11 Pages
Item 4. Purpose of Transaction
(a) On or before May 29, 1998, all of the Vision 21 Shares shall be
liquidated in accordance with the terms and conditions set forth in the Stock
Distribution Agreement referred to in Item 6.
Except as set forth in this Item 4, neither LaserSight nor, to its
knowledge, any of its executive officers or directors has any present plans or
proposals that relate to or that would result in any of the actions specified in
clauses (b) through (j) of Item 4 of Schedule 13D.
Item 5. Interest in Securities of the Issuer
(a) As of the date hereof, LaserSight beneficially owned the Vision 21
Shares, which represent approximately 6.5% of the 12,650,251 outstanding
Shares1. Thomas Quinn, a LaserSight director, beneficially owns 46,050 or 0.4%
of the outstanding Shares (the "Quinn Shares"). To LaserSight's knowledge, none
of its other executive officers or directors beneficially owns any Shares.
(b) LaserSight has the sole power to vote, and the sole power to
dispose of, the Vision 21 Shares, subject to the terms and conditions of the
Stock Distribution Agreement, the Escrow Agreement and the Stock Pledge
Agreement referred to in Item 6. To LaserSight's knowledge, Thomas Quinn has the
sole power to vote, and the sole power to dispose of the Quinn Shares. To
LaserSight's knowledge, none of its other executive officers or directors has
any sole or shared power to vote, or to direct the vote or to dispose or direct
the disposition of, any Shares.
(c) Except for the acquisition by LaserSight of the Vision 21 Shares in
connection with the Stock Purchase Agreement, neither LaserSight nor, to its
knowledge, any of its executive officers or directors has effected any
transactions in Shares during the past 60 days.
(d) LaserSight's right to receive or the power to direct the receipt of
the dividends from, or the proceeds from the sale of the Vision 21 Shares is
subject to the rights of (i) Foothill Capital Corporation, a California
corporation ("Foothill"), under the Stock Pledge Agreement, and (ii) Vision 21
under the Stock Distribution Agreement, as described in Item 6 below. To
LaserSight's knowledge, no other person has a right to receive or the power to
direct the receipt of the dividends from, or the proceeds from the sale of the
- -----------------------
(1) Share number represents the sum of (i) 11,830,166 Shares represented to be
outstanding as of December 29, 1997 by Vision 21 in the Stock Purchase
Agreement, and (ii) the 820,085 Shares issued on December 30, 1997 to
LaserSight pursuant to the Stock Purchase Agreement.
<PAGE>
CUSIP No. 92831N 10 1 13D Page 6 of 11 Pages
Vision 21 Shares. To LaserSight's knowledge, no other person has a right to
receive or the power to direct the receipt of the dividends from, or the
proceeds from the sale of the Quinn Shares.
(e) Not Applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships With Respect to
Securities of the Issuer
Stock Purchase Agreement
- ------------------------
The Vision 21 Shares which are the subject of this statement were
acquired by LaserSight in connection with the sale of LaserSight's wholly-owned
subsidiaries, MEC and LSIA to Vision 21 pursuant to the terms and conditions of
the Stock Purchase Agreement, dated as of December 1, 1997 (the "Stock Purchase
Agreement"), among LaserSight, MEC, LSIA and Vision 21. In accordance with the
terms and conditions of the Stock Purchase Agreement, Vision 21 acquired all of
the issued and outstanding capital stock of MEC and LSIA in exchange for the
delivery to LaserSight of the Vision 21 Shares and $6,500,000 in cash.
Stock Distribution Agreement
- ----------------------------
In connection with the Stock Purchase Agreement, Vision 21 and
LaserSight entered into a Stock Distribution Agreement dated as of December 30,
1997 (the "Stock Distribution Agreement"). The Vision 21 Shares are to be
liquidated pursuant to the following schedule (or sooner, at Vision 21's
option):
Month Approximate
(1998) Percentage
------ ----------
February........ 21%
March........... 21%
April........... 28%
May............. 30%
---
Total........ 100%
====
Under its agreements with LaserSight, Vision 21 is to liquidate the
Vision 21 Shares by a sale through a market maker designated by Vision 21
pursuant to a shelf registration statement or a private placement, or its
repurchase of the Vision 21 Shares. LaserSight is entitled to receive a minimum
of $6,500,000 and a maximum of $7,475,000 from the liquidation of the Vision 21
Shares. If LaserSight has not received at least $6,500,000 (subject to certain
post-closing adjustments) from the liquidation of the Vision 21 Shares by May
29, 1998, then on such date Vision 21 is to pay LaserSight such shortfall in
cash.
<PAGE>
CUSIP No. 92831N 10 1 13D Page 7 of 11 Pages
If Vision 21 fails to make the payments contemplated by the plan of
distribution, Vision 21 is required to prepare and file a registration statement
covering the sale of the Vision 21 Shares within 20 business days after the date
of Vision 21's failure to make a payment and such registration statement is to
be effective as soon as possible, but in no event later than 90 days following
the date of default. If the registration statement is not effective within such
90 day period or if it becomes effective and subsequently LaserSight is unable
to sell shares pursuant to the registration statement then Vision 21 has agreed
to pay LaserSight certain monetary penalties. In addition, if Vision 21 fails to
make the payments contemplated by the plan of distribution, LaserSight is free
to sell the Vision 21 Shares in a private placement subject only to compliance
with applicable securities laws.
LaserSight has agreed not to sell, pledge, transfer or dispose of the
Vision 21 Shares except in accordance with the terms of the Stock Distribution
Agreement and the terms of the Stock Pledge Agreement (as defined below).
Escrow Agreement
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In connection with the Stock Purchase Agreement, Vision 21 and
LaserSight have entered into an Escrow Agreement dated as of December 30, 1997
(the "Escrow Agreement"), pursuant to which LaserSight agreed to place 126,167
of the Vision 21 Shares in escrow (the "Escrow Shares"). LaserSight may be
required to return certain of the Escrow Shares to Vision 21 depending on the
results of certain post-closing adjustments pursuant to the Stock Purchase
Agreement.
Stock Pledge Agreement
- ----------------------
LaserSight and Foothill Capital Corporation, a California corporation
("Foothill"), have entered into a Stock Pledge Agreement (the "Stock Pledge
Agreement"), dated December 30, 1997, pursuant to which LaserSight has pledged
the Vision 21 Shares as collateral to secure its obligations to Foothill under
that certain Loan and Security Agreement, dated March 31, 1997, as amended,
between Foothill, LaserSight and certain of LaserSight's subsidiaries.
* * * *
The foregoing summary of certain provisions of the Stock Distribution
Agreement, the Escrow Agreement, and the Stock Pledge Agreement is not intended
to be complete and is qualified by reference to such agreements set forth in
Exhibits 1 through 3 attached hereto.
Except as summarized above, to LaserSight's knowledge, there
exists no contracts, arrangements, understanding or relationships (legal or
otherwise) among LaserSight and its executive officers or directors or between
<PAGE>
CUSIP No. 92831N 10 1 13D Page 8 of 11 Pages
such persons and any person with respect to any securities of Vision 21,
including but not limited to transfer or voting of any Shares, finder's fees,
joint ventures, loan or option arrangements, puts or calls, guarantees of
profits, division or profits or loss, or the giving or withholding of proxies.
Item 7. Material to be Filed as Exhibits
The Exhibit Index set forth on page 9 of this statement is hereby
incorporated herein by this reference.
SIGNATURE
After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set forth in this statement is true,
complete and correct.
Date: January 9, 1998
LASERSIGHT INCORPORATED
By: \s\ Gregory L. Wilson
-------------------------
Gregory L. Wilson
Chief Financial Officer
<PAGE>
CUSIP No. 92831N 10 1 13D Page 9 of 11 Pages
INDEX TO EXHIBITS
1. Stock Distribution Agreement, dated as of December 30, 1997, between
LaserSight and Vision 21.
2. Escrow Agreement, dated as of December 30, 1997, between LaserSight and
Vision 21.
3. Stock Pledge Agreement, dated as of December 30, 1997, among LaserSight,
certain of LaserSight's subsidiaries and Foothill.
<PAGE>
CUSIP No. 92831N 10 1 13D Page 10 of 11 Pages
ANNEX I
Set forth below are the name, business address and present principal
occupation of each of the directors and executive officers of LaserSight
Incorporated. Except as otherwise noted, each such individual is a citizen of
the United States and the business address of each such person is c/o LaserSight
Incorporated, 12161 Lackland Road, St. Louis, Missouri 63146.
Present Principal Occupation, Citizenship
and Business Address (if other than as
Name indicated above)
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Directors
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Francis E. O'Donnell Jr., M.D. Medical Director
O'Donnell Eye Institute
1028 S. Kirkwood Road
Kirkwood, Missouri 63122-7200
J. Richard Crowley President and Chief Operating Officer
LaserSight Technologies, Inc. (a wholly-
owned subsidiary ofLaserSight Incorporated)
12249 Science Drive, Suite 160
Orlando, Florida 32826
Michael R. Farris President and Chief Executive Officer
LaserSight Incorporated
Terry A. Fuller, Ph.D. President and Chief Executive Officer
Fuller Research Corporation
944 Morgan Road
Rydal, Pennsylvania 19046
Richard C. Lutzy Founder and Chief Executive Officer
Palmer Capital Corporation
545 Cedar Lane
Teaneck, New Jersey 07666
David T. Pieroni President
Pieroni Management Counselors, Inc.
9666 Olive Blvd., Suite 150
St. Louis, Missouri 63132
<PAGE>
CUSIP No. 92831N 10 1 13D Page 11 of 11 Pages
Thomas Quinn President
Smithton Rockwell & Irwin (a subsidiary of
Olsten Corporation)
345 Route 17 South
Upper Saddle River, New Jersey 07458
Executive Officers who are
not Directors
--------------------------
Gregory L. Wilson Chief Financial Officer
LaserSight Incorporated
Richard L. Stensrud Chief Operating Officer
LaserSight Incorporated
President
The Farris Group (a wholly-owned subsidiary
of LaserSight Incorporated)
STOCK DISTRIBUTION AGREEMENT
----------------------------
This Stock Distribution Agreement ("Agreement"), dated as of December 30,
1997, is by and between Vision Twenty-One, Inc. ("Vision 21"), a Florida
corporation and any successor, and LaserSight Incorporated (the "Stockholder"),
a Delaware corporation.
R E C I T A L S
---------------
A. The Stockholder and Vision 21 have executed that certain Stock Purchase
Agreement effective as of December 1, 1997 (the "Stock Purchase Agreement"),
pursuant to which Vision 21 has agreed to acquire all of the issued and
outstanding stock of MEC Health Care, Inc. and LSI Acquisition, Inc., in
exchange for delivery to the Stockholder of 812,500 shares of Vision 21 common
stock and the Additional Shares (as defined in the Stock Purchase Agreement,
collectively, the "Restricted Shares") and $6,500,000 in cash, as more fully set
forth in the Stock Purchase Agreement.
B. The Stockholder and Vision 21 desire to enter into the plan of
distribution (the "Plan of Distribution") described herein for liquidation of
the Restricted Shares through, at Vision 21's sole option, a "shelf"
registration statement, private placement, redemption by Vision 21 or other
method acceptable to Vision 21 and the Stockholder.
NOW THEREFORE, for and in consideration of the mutual agreements, terms,
covenants and conditions herein and for other good and valuable consideration,
the receipt and adequacy of which are hereby acknowledged, the parties agree as
follows:
1. Plan of Distribution of Restricted Shares.
(a) Stockholder agrees that on each date specified in Section 1(b)
below that number of the Restricted Shares so indicated in connection with such
date shall, at Vision 21's sole option, either (i) be sold through a market
maker designated by Vision 21 through a "shelf" registration statement (the
"Registration Statement") pursuant to Sections 2, 3 and 4 hereof, (ii) be sold
through a market maker designated by Vision 21 through a private placement
pursuant to Sections 5, 6 and 7 hereof or other method of sale reasonably
acceptable to Vision 21 and the Stockholder, or (iii) be purchased by Vision 21
pursuant to Section 8 hereof.
(b) The Restricted Shares shall be liquidated on, or, at Vision 21's
option, before the following specified dates in the following specified
increments in accordance with the terms of this Agreement:
RESTRICTED SHARES DISTRIBUTION SCHEDULE
---------------------------------------
Number of Shares
Date to be Liquidated
-------------------------------------------------------------------------------
February 2 through 166,666 and 25% of the Additional Shares
February 27, 1998
March 2 through March 31, 1998 166,667 and 25% of the Additional Shares
<PAGE>
April 1 through April 30, 229,167 and 25% of the Additional Shares
1998
May 1 through May 29, 250,000 and 25% of the Additional Shares
1998
(c) Vision 21 agrees that no matter how the Restricted Shares are
liquidated pursuant to this Agreement on each of the dates set forth in Section
1(b) hereof the Stockholder shall receive from Vision 21 and/or the party
purchasing Restricted Shares a sum equal to the number of Restricted Shares to
be sold on such date times the closing price of Vision 21 common stock as quoted
by the NASDAQ National Market System on such date. Vision 21 also agrees the
Stockholder shall receive a minimum of an aggregate of Six Million Five Hundred
Thousand Dollars ($6,500,000) and a maximum of an aggregate of Seven Million
Four Hundred Seventy-Five Thousand Dollars ($7,475,000) in connection with the
liquidation of the Restricted Shares. In the event the Stockholder realizes
aggregate gross proceeds from the sale of the Restricted Shares equal to Seven
Million Four Hundred Seventy-Five Thousand Dollars ($7,475,000) prior to all
Restricted Shares being liquidated pursuant to the Plan of Distribution, the
Restricted Shares not yet liquidated, if any, shall be returned to Vision 21. If
by 4:00 p.m., New York time, on May 29, 1998, the Stockholder has not realized
the sum of at least Six Million Five Hundred Thousand Dollars ($6,500,000) from
the sale of the Restricted Shares, Vision 21 shall pay the Stockholder by wire
transfer of immediately available funds on May 29, 1998 the cash sum which is
equal to Six Million Five Hundred Thousand Dollars ($6,500,000) less the
proceeds received through such date by the Stockholder from the sale of
Restricted Shares. However, if on such date not all Restricted Shares have been
liquidated and Vision 21 exercises its right under Section 8 of this Agreement
to redeem such Restricted Shares, then, such Restricted Shares shall be returned
to Vision 21 in connection with the purchase thereof.
(d) Stockholder agrees not to sell, pledge, transfer or dispose of the
Restricted Shares except in accordance with the terms of this Agreement and the
terms of that certain Stock Pledge Agreement between the Stockholder and
Foothill Capital Corporation dated as of December 30, 1997.
(e) The parties acknowledge and agree that the number of Restricted
Shares (and therefore the Six Million Five Hundred Thousand Dollar ($6,500,000)
minimum payment contemplated by Section 1(c) and the Seven Million Four Hundred
Seventy-Five Thousand Dollar ($7,475,000) maximum payment contemplated by
Section 1(c)) shall be subject to the adjustments contemplated by Section 2.5 of
the Stock Purchase Agreement.
2. Shelf Registration.
(a) Vision 21 may, in its sole discretion, file and cause to be
declared effective as soon as practicable a Registration Statement pursuant to
the Securities Act of 1933, as amended (the "Securities Act") for all of the
Restricted Shares not yet liquidated in accordance with the Plan of
Distribution, which form will then be available for the sale of the Restricted
Shares in accordance with the Plan of Distribution. The Registration Statement
shall be kept effective until such time as all of the Restricted Shares have
been liquidated, provided that Vision 21 may terminate an effective Registration
Statement prior to all of the Restricted Shares being liquidated if on the date
of such termination Vision 21 is in compliance with the terms of this Agreement.
<PAGE>
(b) Vision 21 shall have the right to extend, temporarily suspend or
delay the effectiveness of any Registration Statement for a period of up to
thirty (30) days if, upon the advice of counsel, such extension, suspension or
delay is advisable and in the best interests of Vision 21 because of the
existence of non-public material information, or to allow Vision 21 to complete
any pending audit of its financial statements, any material public financing
plan, any pending material acquisition, or to release audited financial
statements for any pending material acquisition as required by the Securities
and Exchange Commission (the "Commission"), provided that Vision 21 shall only
be entitled to one such suspension during the Plan of Distribution.
(c) The Stockholder agrees to cooperate with Vision 21 in all
reasonable respects in connection with registration of the Restricted Shares,
including timely supplying all information and executing and returning all
documents requested by Vision 21 which are reasonable and customary.
(d) Vision 21 shall be entitled to include in the Registration
Statement any other securities of Vision 21 (whether to be offered by Vision 21
or other Vision 21 security holders and regardless of the proposed terms of the
transfer or sale of such other securities).
3. Registration Covenants of Vision 21. In the event Vision 21 elects to
file a Registration Statement to liquidate the Restricted Shares, Vision 21
hereby covenants and agrees to:
(a) Take such steps as may be necessary to comply with the Blue Sky
laws of such states as may be required by law; provided that in no event shall
Vision 21 be obligated to qualify to do business in any state where it is not so
qualified or to take any action which would subject it to unlimited service of
process in any state where it is not at such time so subject;
(b) Pay all fees and expenses of Vision 21's counsel, all accounting
costs (including costs associated with the preparation of interim period
financial statements), registration and Blue Sky filing fees, NASD fees,
printing costs, experts' fees and expenses, costs of post-effective amendments,
Eligible Broker's Fees (as defined herein), and all other usual and customary
expenses in connection with the Registration Statement;
(c) Notify the Stockholder promptly after it shall receive notice
thereof, of the date and time when such Registration Statement and each
post-effective amendment thereto has become effective or a supplement to any
prospectus forming a part of such Registration Statement has been filed and
provide the Stockholder with such number of prospectuses, and any amendments
thereof or supplements thereto, the Stockholder may reasonably request;
(d) Promptly notify the Stockholder of any request by the Commission
for the amending or supplementing of such registration statement or prospectus
or for additional information and provide the Stockholder with copies of such
requests;
<PAGE>
(e) Prepare and promptly file with the Commission and promptly notify
Stockholder of the filing of such amendments or supplements to such Registration
Statement or prospectus as may be necessary to correct any statements or
omissions if, at the time when a prospectus relating to the Restricted Shares is
required to be delivered under the Securities Act, any event has occurred as the
result of which any such prospectus or any other prospectus as then in effect
may include an untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein
not misleading;
(f) Advise the Stockholder promptly after it shall receive notice or
obtain knowledge thereof, of the issuance of any stop order by the Commission
suspending the effectiveness of such Registration Statement or the initiation or
threatening of any proceeding for that purpose and promptly use its best efforts
to prevent the issuance of any stop order or to obtain its withdrawal if such
stop order should be issued; and
(g) Once the Registration Statement is effective Vision 21 shall, on or
before the relevant date set forth in Section 1(b) hereof, instruct its transfer
agent to immediately remove any restrictive legend from that number Restricted
Shares then eligible to be sold pursuant to the Plan of Distribution. For
purposes of Sections 3(b) and 6(b) "Eligible Broker's Fees" shall mean brokers',
underwriters' and placement agents' fees, commissions and discounts related to
the liquidation of Restricted Shares pursuant to a Registration Statement or a
private placement, provided that if the Stockholder receives in excess of Six
Million Five Hundred Thousand Dollars ($6,500,000) from the liquidation of
Restricted Shares then the amount so received by the Stockholder in excess of
Six Million Five Hundred Thousand Dollars ($6,500,000), shall be utilized to pay
all customary brokers', underwriters' and placement agents' fees, commissions
and discounts related to the liquidation of Restricted Shares, until such fees
are paid in full and thereafter such excess shall be retained by the Stockholder
subject to the limitations of Section 1(c).
4. Registration Covenants of Stockholder. In the event Vision 21 elects to
file a Registration Statement to liquidate the Restricted Shares, Stockholder
hereby covenants and agrees:
(a) To cooperate with Vision 21 in its compliance with all federal and
state securities laws, including without limitation providing such information
and signing such documents as are necessary to effect registration pursuant to
this Agreement; and
(b) To the entry of stop transfer instructions with Vision 21's
transfer agent against the transfer of any Restricted Shares except in
compliance with all applicable securities laws.
5. Private Placement.
(a) Vision 21 may, in its sole discretion, sell Restricted Shares
pursuant to a private placement through a market maker designated by Vision 21.
<PAGE>
(b) The Stockholder agrees to cooperate with Vision 21 in all
reasonable respects in connection with the private placement of the Restricted
Shares, including timely supplying all information and executing and returning
all documents requested by Vision 21 which are reasonable and customary.
(c) Vision 21 shall be entitled to include in the private placement any
other securities of Vision 21 (whether to be offered by Vision 21 or other
Vision 21 security holders and regardless of the proposed terms of the transfer
or sale of such other securities).
(d) In connection with any private placement of Restricted Shares the
Stockholder shall be entitled to receive from Vision 21 and/or the purchaser of
the Restricted Shares so sold the closing price of Vision 21 common stock as
quoted by the NASDAQ National Market System on the date of the sale pursuant to
the private placement.
6. Private Placement Covenants of Vision 21. In the event Vision 21 elects
to liquidate the Restricted Shares pursuant to a private placement, Vision 21
hereby covenants and agrees to:
(a) Take such steps as may be necessary to comply with the Blue Sky
laws of such states as may be required by law; provided that in no event shall
Vision 21 be obligated to qualify to do business in any state where it is not so
qualified or to take any action which would subject it to unlimited service of
process in any state where it is not at such time so subject; and
(b) Pay all fees and expenses of Vision 21's counsel, all accounting
costs (including costs associated with the preparation of interim period
financial statements), registration and Blue Sky filing fees, printing costs,
experts' fees and expenses, Eligible Brokers' Fees, and all other usual and
customary expenses in connection with the private placement.
7. Private Placement Covenants of Stockholder. In the event Vision 21
elects to liquidate the Restricted Shares pursuant to a private placement,
Stockholder hereby covenants and agrees:
(a) To cooperate with Vision 21 in its compliance with all federal and
state securities laws, including without limitation providing such information
and signing such documents as are necessary to effect the private placement
pursuant to this Agreement; and
(b) That in no event will the Stockholder be eligible to receive more
than the maximum amount contemplated by Section 1(c) from the liquidation of
Restricted Shares.
8. Redemption. Vision 21 shall have the right to redeem all or any part of
the Restricted Shares at any time by paying the Stockholder a cash sum equal to
the number resulting from multiplying the number of Restricted Shares so
redeemed by the greater of (i) the Valuation Price (as defined in the Stock
Purchase Agreement), and (ii) the closing price of Vision 21 common stock as
quoted by the NASDAQ National Market System on the date of such redemption. In
no event will the Stockholder be eligible to receive more than the maximum
amount contemplated by Section 1(c) from the liquidation of Restricted Shares.
<PAGE>
9. Indemnification of Stockholder. Whenever registration with respect to
any shares of Stockholder's Restricted Shares is effected under the Securities
Act pursuant hereto or when Restricted Shares are sold pursuant to a private
placement, Vision 21 will indemnify and hold harmless the Stockholder and its
directors and officers from and against any and all losses, claims, liabilities,
expenses and damages (including any and all investigative, legal and other
expenses reasonably incurred in connection with, and any amount paid in
settlement of, any action, suit or proceeding or any claim asserted), to which
they may become subject under the Securities Act, the Exchange Act of 1934 (the
"Exchange Act") or other federal or state statutory law or regulation, at common
law or otherwise, insofar as such losses, claims, liabilities, expenses or
damages arise out of or are based on any untrue statement or alleged omission to
state in the Registration Statement, private placement memorandum or other
document filed with the Commission, a material fact required to be stated or
necessary to make the statements in such a document not misleading, provided
that Vision 21 will not be liable to Stockholder to the extent that such loss,
claim, liability, expense or damage is based on an untrue statement or omission
made in reliance on and in conformity with written information furnished to
Vision 21 by Stockholder or through any attorney-in-fact for Stockholder,
expressly for inclusion in the Registration Statement or any prospectus included
in the Registration Statement or a private placement memorandum.
10. Indemnification of Vision 21. Whenever registration with respect to any
shares of Stockholder's Restricted Shares is effected under the Securities Act
pursuant hereto or when Restricted Shares are sold pursuant to a private
placement, the Stockholder will indemnify and hold harmless Vision 21 and each
of Vision 21's directors and officers from and against any and all losses,
claims, liabilities, expenses and damages (including any and all investigative,
legal and other expenses reasonably incurred in connection with, and any amount
paid in settlement of, any addition, suit or proceeding or any claim asserted),
to which they, or any of them, may become subject under the Securities Act, the
Exchange Act or other federal or state statutory law or regulation, at common
law or otherwise, insofar as such losses, claims, liabilities, expenses or
damages arise out of or are based on any untrue statement or alleged untrue
statement of a material fact required to be stated in the Registration Statement
or private placement memorandum or necessary to make the statements in such
documents not misleading; provided that Stockholder will not be liable except to
the extent that such loss, claim, liability, expense or damage arises from or is
based upon an untrue statement or omission or alleged untrue statement or
omission made in reliance on and in conformity with written information
furnished to Vision 21 by the Stockholder, or by the Stockholder through any
attorney-in-fact, expressly for inclusion in the registration statement or any
prospectus included in such registration statement or a private placement
memorandum.
11. Defense of Claim. Promptly after receipt by an indemnified party of
notice of the commencement of any action, the indemnified party shall notify the
indemnifying party in writing of the commencement thereof if a claim in respect
thereof is to be made against any indemnifying party under this Agreement, but
the omission of such notice shall not relieve the indemnifying party from
liability which it may have to the indemnified party under this Agreement,
except to the extent that the indemnifying party is actually prejudiced by such
failure to give notice, and shall not relieve the indemnifying party from any
liability which it may have to any indemnified party otherwise than under this
Agreement. In case any action is brought against the indemnified party and it
shall notify the indemnifying party of the commencement thereof, the
indemnifying party shall be entitled to participate in, and to the extent that
<PAGE>
it chooses, to assume the defense thereof with counsel reasonably satisfactory
to the indemnified party, and after notice from the indemnifying party to the
indemnified party that it so chooses, the indemnifying party shall not be liable
for any legal or other expenses subsequently incurred by the indemnified party
in connection with the defense thereof; provided however that (i) if the
indemnifying party fails to take reasonable steps necessary to defend diligently
the claim within twenty (20) days after receiving notice from the indemnified
party that the indemnified party believes the indemnifying party has failed to
diligently defend such claim, or (ii) if the indemnified party who is a
defendant in any action or proceeding which is also brought against the
indemnifying party reasonably shall have concluded that there are legal defenses
available to the indemnified party which conflict with the defense strategy of
the indemnifying party, or (iii) if in the opinion of counsel for the
indemnified party a conflict of interest exists that requires separate
representation of the indemnified party and the indemnifying party, then the
indemnified party shall have the right to assume or continue its own defense as
set forth above and the indemnifying party shall reimburse the indemnified party
for the costs of such defense. In no event shall the indemnifying party be
reasonable for the fees of more than one firm for all indemnified parties.
12. Survival of Indemnity. The indemnifications provided by this Agreement
shall be a continuing right to indemnification and shall survive the
registration and sale of any securities by any person entitled to
indemnification hereunder and the expiration or termination of this Agreement.
13. Remedies. If Vision 21 fails to take the actions or make the payments
described in Sections 1(a) or 1(c) hereof on or before the date which is three
business days after the date specified in such Sections (the "Default Date")
then the following shall apply:
(a) Vision 21 shall prepare, and, on or prior to 20 business days after
the Default Date (the "Filing Date"), file with the Commission a registration
statement on Form S-3 (or, if Form S-3 is not then available, on such form of
registration statement as is then available to effect a registration of all of
the Restricted Shares) covering the resale of all of the Restricted Shares. Such
registration statement (and each amendment or supplement thereto) shall be
provided to (and subject to the approval of (which approval shall not be
unreasonably withheld or delayed)) the Stockholder and their counsel prior to
its filing or other submission, except to the extent that a post-effective
amendment of such registration statement, or supplement to the related
prospectus, is required by applicable securities law to be filed before such
approval can reasonably be obtained, in which case Vision 21 shall provide a
copy of such amendment or supplement, as applicable, to the Stockholder and
their counsel as soon as practicable after such filing. Vision 21 shall cause
such registration statement to become effective as soon as practicable after
such filing and keep such registration statement effective at all times until
such date as is the earlier of (i) the date on which all of the Restricted
Shares have been sold, and (ii) the date on which all of the Restricted Shares
may be immediately sold to the public without registration conditions, or
limitations, whether pursuant to Rule 144(k) or otherwise (the "Registration
Period").
Vision 21 shall cause such registration statement to become effective
as soon as practicable, but in no event later than the ninetieth (90th) day
following the Default Date (the "Registration Deadline"). If (i) such
registration statement covering all of the Restricted Shares is not declared
<PAGE>
effective by the Commission on or before the Registration Deadline, or (ii)
after such registration statement has been declared effective by the Commission,
sales of all the Restricted Shares cannot be made pursuant to such registration
statement (by reason of a stop order or Vision 21's failure to update the
registration statement), then Vision 21 will make payments to the Stockholder in
such amounts and at such times as shall be determined pursuant to this Section
13(a) as partial relief for the damages to the Stockholder by reason of any such
delay in or reduction of their ability to sell the Restricted Shares (which
remedy shall not be exclusive of any other remedies available at law or in
equity). Vision 21 shall pay to the Stockholder an amount equal to (i) (A) .01
per month (prorated daily during the first 30 days after the Registration
Deadline) and .02 per month, prorated daily (thereafter) times (B) the aggregate
value of the Restricted Shares not yet liquidated pursuant to the Plan of
Distribution (such value shall be calculated utilizing the closing price of
Vision 21 common stock as quoted by the NASDAQ National Market System as of the
date the Restricted Stock was issued) times (ii) the sum of: (A) the number of
months (prorated per day for partial months) following the Registration Deadline
but prior to the date such registration statement is declared effective by the
Commission plus (B) the number of months (prorated per day for partial months)
following the Registration Deadline but prior to the termination of the
Registration Period that sales cannot be made pursuant to the Registration
Statement after the Registration Statement has been declared effective. Such
amounts shall be paid in cash within five business days after the end of each
period that gives rise to such obligation, provided that, if any such period
extends for more than 30 days, payments shall be made for each such 30 day
period within five business days after the end of such 30 day period.
(b) The Stockholder will be free to sell all of the Restricted Shares
in a private placement or other transaction subject only to compliance with
applicable securities laws, including, without limitation, to persons in the
United States whom the Stockholder reasonably believes to be qualified
institutional buyers as defined in Rule 144A under the Securities Act, as such
rule may be amended from time to time ("Rule 144A"), in transactions under Rule
144A and (ii) to a limited number of other institutional "accredited investors"
(as defined in Rule 501(a)(1), (2), (3) and (7) under Regulation D of the Act)
in private sales exempt from registration under the Act (such persons specified
in clauses (i) and (ii) being referred to herein as the "Eligible Purchasers").
Sales to Eligible Purchasers shall be made in compliance with applicable
securities laws and any shares so sold shall bear appropriate restrictive
legends.
Vision 21 agrees to take all necessary steps to facilitate the
Stockholder's sale of the Restricted Shares to Eligible Purchasers. During the
period of time the Stockholder is trying to sell the Restricted Shares pursuant
to this Section 13(b), Vision 21 shall advise the Stockholder promptly and, if
requested by it, shall promptly confirm such advice in writing, of any material
adverse change, or of any event or condition known to Vision 21 which is
reasonably likely to result in a material change, in the condition (financial or
other), business, prospects, liabilities (contingent or otherwise), properties,
net worth, solvency or results of operations of Vision 21 (whether or not
arising in the ordinary course of business), or of the happening of any event,
any information becoming known or the existence of any condition that would
require any amendment or supplement to any Vision 21 filing with the Commission
so that such filings would 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 the light of the circumstances under which they
were made, not misleading.
<PAGE>
Vision 21 will cooperate with the Stockholder and with its counsel in
connection with the qualification of the Restricted Shares for offering and sale
by the Stockholder and by dealers to Eligible Purchasers under the securities or
Blue Sky laws of such jurisdictions as the Stockholder may designate and will
file such consents to service of process or other documents necessary or
appropriate in order to effect such qualification.
For so long as any of the Restricted Shares are held by the Stockholder
and are "restricted securities" within the meaning of Rule 144(a)(3) under the
Act and during any period in which Vision 21 is not subject to Section 13 or
15(d) of the Securities Exchange Act of 1934, as amended, Vision 21 will furnish
to holders and beneficial owners of the Restricted Shares and prospective
purchasers of Restricted Shares designated by such holders, upon request of such
holders or beneficial owners or such prospective purchasers, the information
required to be delivered pursuant to Rule 144A(d)(4) under the Act to permit
compliance with Rule 144A in connection with resales of the Restricted Shares.
(c) The Stockholder will be free to seek all other remedies which may
be available at law or in equity in connection with Vision 21's failure to
comply with the terms of this Agreement.
14. Listing on Securities Exchanges. Vision 21 shall cause the listing and
the continuation of listing of Vision 21's common stock on the NASDAQ National
Market. By February 1, 1998 Vision 21 shall file the appropriate application
(and pay the associated fee) for listing the Restricted Shares with NASDAQ.
15. SEC Filings. During the period of time the Stockholder owns the
restricted Shares Vision 21 shall supply the Stockholder with a copy of all
annual or quarterly reports of Vision 21 and such other reports and documents
filed by the Company with the Commission. Such copies shall be supplied within
three business days after the filing thereof with the Commission.
16. Non-Transferability. The benefits set forth herein, including
indemnification by Vision 21, are granted for the sole and personal benefit of
the Stockholder and may not be transferred or assigned, provided that Vision 21
consents to the terms and conditions of that certain Collateral Assignment among
Vision 21, the Stockholder and Foothill Capital Corporation dated December 30,
1997.
17. Delay of Registration. Stockholder agrees that it shall have no right
to obtain or seek an injunction restraining or otherwise delaying any
registration statement filed by Vision 21.
18. Notices.
(a) All communications under this Agreement shall be in writing and
shall be sufficient in all respects if personally delivered or mailed by prepaid
certified or registered mail, return receipt requested, addressed as follows:
<PAGE>
(i) If to Vision 21, at:
Vision Twenty-One, Inc.
7209 Bryan Dairy Road
Largo, Florida 34647
Attn: Theodore N. Gillette, Chief Executive Officer
With a copy to:
Darrell C. Smith, Esquire
Shumaker, Loop & Kendrick, LLP
101 E. Kennedy Boulevard, Suite 2800
Tampa, Florida 33602
(ii) If to the Stockholder at:
LaserSight Incorporated
12161 Lackland Road
St. Louis, Missouri 63146
Attn: Michael R. Farris, Chief Executive Officer
with a copy to:
Alan B. Bornstein, Esquire
Sonnenschein Nath & Rosenthal
One Metropolitan Square
Suite 3000
St. Louis, Missouri 63102
or at such other address as one party may have furnished in writing to the other
party.
(b) Any notice so addressed, when mailed by registered or certified
mail, shall be deemed to be given three days after so mailed, and when delivered
by hand shall be deemed to be given upon delivery.
19. Counterparts. One or more counterparts of this Agreement may be signed
by the parties, each of which shall be an original but all of which together
shall constitute one and the same instrument.
20. Governing Law. This Agreement shall be construed in accordance with and
governed by the internal laws of the State of Florida, which shall prevail in
all matters arising under or in connection with this Agreement.
21. Headings. The headings in this Agreement are for convenience of
reference only and shall not be deemed to alter or affect the meaning or
interpretation of any provisions hereof.
<PAGE>
22. Stock Lettering. Vision 21 shall have the right to provide a legend on
the shares of Common Stock covered hereunder reflecting the restrictions
described herein.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the
date and year first above written.
VISION TWENTY-ONE, INC.
By: /s/ Richard T. Welch
-------------------------------
Richard T. Welch,
its Chief Financial Officer
LASERSIGHT INCORPORATED
By: /s/ Michael R. Farris
-------------------------------
Michael R. Farris,
its Chief Executive Officer
ESCROW AGREEMENT
----------------
This Escrow Agreement is made and entered into this 30th day of
December, 1997, by and among LASERSIGHT INCORPORATED, a Delaware corporation
(the "Stockholder"), VISION TWENTY-ONE, INC., a Florida corporation ("Vision
21"), and SHUMAKER, LOOP & KENDRICK, LLP, as escrow agent (the "Escrow Agent").
R E C I T A L S
---------------
A. The Stockholder and Vision 21 have executed that certain Stock Purchase
Agreement effective as of December 1, 1997 (the "Stock Purchase Agreement"),
pursuant to which Vision 21 has agreed to acquire all of the issued and
outstanding stock of MEC Health Care, Inc., a Maryland corporation, and LSI
Acquisition, Inc., a New Jersey corporation (the "Acquired Companies"), in
exchange for shares of Vision 21 common stock and cash, as more fully set forth
in the Stock Purchase Agreement.
B. The parties hereto desire that the transactions contemplated in the
Stock Purchase Agreement shall be consummated effective as of December 1, 1997
pending satisfaction of the terms and conditions set forth in the Stock Purchase
Agreement and this Escrow Agreement.
C. The Stock Purchase Agreement provides for the Adjustment Shares to be
held in escrow as a component of the Stock Purchase Consideration. The Escrow
Agent is willing to act as escrow agent in respect of the Adjustment Shares on
the terms and conditions set forth herein.
D. Capitalized terms used herein and not otherwise defined shall have the
meanings ascribed thereto in the Stock Purchase Agreement.
NOW THEREFORE, for and in consideration of the mutual agreements, terms,
covenants and conditions herein and for other good and valuable consideration,
the receipt and adequacy of which are hereby acknowledged, the parties agree as
follows:
1. Recitals. The foregoing recitals are incorporated into and made an
integral part of this Escrow Agreement.
2. Escrow of Adjustment Shares. The Escrow Agent acknowledges receipt of
the Adjustment Shares delivered to it at closing pursuant to the Stock Purchase
Agreement. The Adjustment Shares and any other funds delivered by the
Stockholder to the Escrow Agent shall be held in escrow by the Escrow Agent, at
no charge for such services, until Escrow Agent either receives the appropriate
notice specified in Section 3 below or receives written instructions signed by
both the Stockholder and the Purchaser describing how the Adjustment Shares and
any other funds are to be disbursed.
3. Letter of Direction and Termination of Escrow.
<PAGE>
(a) At the same time the Stockholder delivers to Vision 21 the Proposed
Stock Purchase Consideration Adjustment contemplated by Section 2.5(b) of the
Stock Purchase Agreement, the Stockholder shall provide a letter of direction to
the Escrow Agent (the "Stockholder Letter of Direction") setting forth the
number of Adjustment Shares which are to be delivered to the Stockholder in
accordance with Section 2.5(a) of the Stock Purchase Agreement. Subject to the
terms of Section 3(b) herein, the Escrow Agent shall deliver to the Stockholder
the number of Adjustment Shares described in the Stockholder Letter of Direction
on the first to occur of (i) the expiration of the thirty-first day after the
date the Stockholder Letter of Direction is delivered to the Escrow Agent, or
(ii) Vision 21 providing Escrow Agent with written instructions that the number
of Adjustment Shares described in the Stockholder Letter of Direction be
delivered to the Stockholder. Vision 21 agrees that if prior to the date which
is 30 days after the date the Stockholder supplies Vision 21 with the Proposed
Stock Purchase Consideration Adjustment it has determined that it agrees with
the calculation of the Proposed Stock Purchase Consideration Adjustment, then it
will promptly provide the Escrow Agent with the written notice described in
subsection (ii) of the immediately preceding sentence.
(b) If Vision 21 disputes the calculation of the Proposed Stock
Purchase Consideration Adjustment, then on or before the date which is 30 days
after the date on which the Stockholder delivers the Proposed Stock Purchase
Consideration Adjustment to Vision 21, Vision 21 shall so object to the
Stockholder and Escrow Agent in writing (the "Vision 21 Objection") setting
forth a specific description of the nature of the objection and the
corresponding adjustments Vision 21 believes should be made. If the Escrow Agent
has received the Vision 21 Objection it will not release any Adjustment Shares
until the first to occur of:
(i) receipt of a written notice signed jointly by Vision 21 and
the Stockholder setting forth the number of Adjustment Shares to
be delivered to the Stockholder; or
(ii) receipt of the notice of determination by the arbitrator to
be appointed pursuant to Section 2.5(b) of the Stock Purchase
Agreement as to how many Adjustment Shares are to be delivered to
the Stockholder.
Immediately upon receipt of the notice contemplated by subsection (i) or (ii) of
the immediately preceding sentence the Escrow Agent shall deliver the indicated
number of Adjustment Shares to the Stockholder.
(c) If less than all of the Adjustment Shares are to be delivered to
the Stockholder, the Escrow Agent and Vision 21 will utilize their best efforts
to instruct Vision 21's transfer agent to cancel the stock certificate
representing the Adjustment Shares and issue a new certificate representing that
<PAGE>
number of Adjustment Shares to be delivered to the Stockholder. Adjustment
Shares which are not delivered to the Stockholder pursuant to this Section 3
shall be returned to Vision 21.
(d) The obligation of the Escrow Agent hereunder shall terminate
immediately upon the delivery of all Adjustment Shares and other funds held by
the Escrow Agent in accordance with the provisions of this Agreement and any
other agreement among the Stockholder, Vision 21 and the Escrow Agent.
4. Notices. All notices, demands or other communications given under or in
connection with this Escrow Agreement shall be in writing and sent by certified
mail, return receipt requested, to the parties at the following addresses or
such other addresses as the parties notify each other in writing:
If to the Stockholder: LaserSight Incorporated
12161 Lackland Road
St. Louis, MO 63146
Attn: Michael R. Farris, Chief Executive Officer
With copies to: Sonnenschein Nath & Rosenthal
One Metropolitan Square
Suite 3000
St. Louis, Missouri 63102
Facsimile No. (314) 259-5959
Attn: Alan Bornstein, Esquire
If to Vision 21: Vision Twenty-One, Inc.
7209 Bryan Dairy Road
Largo, Florida 33777
Attn: Richard Welch, CFO
With a copy to: Shumaker, Loop & Kendrick, LLP
101 East Kennedy Boulevard, Suite 2800
Tampa, Florida 33602
Attn: Darrell C. Smith, Esquire
If to Escrow Agent: Shumaker, Loop & Kendrick, LLP
101 East Kennedy Boulevard, Suite 2800
Tampa, Florida 33602
5. Escrow Agent. The following provisions shall govern the duties and
responsibilities and define the liabilities of the Escrow Agent hereunder:
<PAGE>
(a) Limited Liability. It is agreed that the duties of the Escrow Agent
are only such as herein specifically provided, being purely ministerial in
nature, and that the Escrow Agent shall incur no liability whatsoever except for
willful misconduct. The Stockholder and Vision 21 release Escrow Agent from any
act done or omitted to be done by the Escrow Agent in good faith in the
performance of the Escrow Agent's duties hereunder.
(b) Responsibilities. Escrow Agent shall be under no responsibility
with respect to the Adjustment Shares to be held by it pursuant to this
Agreement other than to faithfully follow the instructions herein contained.
Escrow Agent may consult with counsel and shall be fully protected in any
actions taken in good faith, in accordance with such advice. Escrow Agent shall
not be required to defend any legal proceedings which may be instituted against
the Escrow Agent in respect to the subject matter of these instructions unless
requested to do so by the Stockholder and Vision 21 and indemnified to the
satisfaction of the Escrow Agent against the cost and expense of such defense.
Escrow Agent shall not be required to institute legal proceedings of any kind.
Escrow Agent shall have no responsibility for the genuineness or validity of any
documents or other items deposited with the Escrow Agent, and shall be fully
protected in acting in accordance with any written instructions given to the
Escrow Agent hereunder and believed by the Escrow Agent to have been signed by
the proper parties.
(c) Interpleader. If there is any dispute as to whether the Escrow
Agent is obligated to disburse the Adjustment Shares, or as to whom the
Adjustment Shares are to be delivered, the Escrow Agent will not be obligated to
make any delivery of said Adjustment Shares, but in such event may hold said
Adjustment Shares, until receipt by the Escrow Agent of any authorization in
writing signed by all of the persons having an interest in such dispute,
directing the disposition of the Adjustment Shares, or in the absence of such
authorization, the Escrow Agent may hold the Adjustment Shares until the final
determination of the rights of the parties in an appropriate proceeding. If such
written authorization is not given, or proceedings for such determination are
not begun and diligently continued, the Escrow Agent may, but is not required
to, bring an appropriate action or proceeding for leave to deposit the
Adjustment Shares in any Circuit Court in the State of Florida. In making
delivery of the Adjustment Shares in the manner provided for in this Agreement,
the Escrow Agent shall have no further liability in the matter, and the
Stockholder and Vision 21 shall be liable for all Escrow Agent's costs and fees,
to include, without limitation, attorney's fees related to the performance of
Escrow Agent's duties hereunder. Such liability will be divided evenly between
Vision 21 on the one hand and the Stockholder on the other hand.
(d) No Conflict. The Stockholder acknowledge that Escrow Agent acts as
Vision 21's legal counsel. The Stockholder and Vision 21 stipulate and agree
that, in the event a dispute arises between the parties concerning this
Agreement, Escrow Agent may continue to represent Vision 21 and the Stockholder
shall not request the disqualification of Escrow Agent as counsel for Vision 21
because Escrow Agent is also acting as the Escrow Agent hereunder.
<PAGE>
(e) Indemnification. The Stockholder and Vision 21 agree to indemnify
and hold the Escrow Agent harmless from any and all matters, liabilities and
damages arising out of this Agreement or the Escrow Agent's duties and
obligations under this Agreement, including, without limitation, attorneys'
fees. Such indemnification will be divided evenly between Vision 21 on the one
hand and the Stockholder on the other hand.
6. Arbitration. Disputes, controversies or claims arising out of this
Agreement shall be resolved in accordance with the terms of Section 17.1 of the
Stock Purchase Agreement.
7. Agreement. This Agreement shall not be amended except by an instrument
in writing signed by all the parties hereto. This Agreement may be executed in
one or more counterparts, each of which shall be deemed an original. This
Agreement shall be binding on the parties hereto and their successors and
assigns. In the event that any provision of this Agreement is held to be illegal
or unenforceable, the remainder of this Agreement shall remain in full force and
effect. This Agreement shall be construed and enforced in accordance with the
laws of the State of Florida.
IN WITNESS WHEREOF, the parties hereto have duly executed this Escrow
Agreement as of the date first written above.
"STOCKHOLDER"
LASERSIGHT INCORPORATED
By: /s/ Michael R. Farris
----------------------------
Michael R. Farris
As Its: Chief Executive Officer
"VISION 21"
VISION TWENTY-ONE, INC.
By: /s/ Richard T. Welch
----------------------------
Richard T. Welch
As Its: Chief Financial Officer
"ESCROW AGENT"
SHUMAKER, LOOP & KENDRICK, LLP
By: /s/ Victoria J. Elliot
----------------------------
Victoria J. Elliot
STOCK PLEDGE AGREEMENT
----------------------
THIS STOCK PLEDGE AGREEMENT (this "Agreement"), dated as of
December 30, 1997, is entered into between Lasersight Incorporated, a Delaware
corporation ("Pledgor"), and Foothill Capital Corporation, a California
corporation ("Secured Party"), with reference to the following:
WHEREAS, Pledgor, MEC Health Care, Inc., a Maryland corporation
("MEC"), LSI Acquisition, Inc., a New Jersey corporation ("LSI"), Lasersight
Technologies, Inc., a Delaware corporation, Lasersight Centers Incorporated, a
Delaware corporation, and MRF, Inc., a Missouri corporation ("MRF")
(collectively "Borrower") and Secured Party have entered into that certain Loan
and Security Agreement dated as of March 31, 1997, as amended by that certain
Consent and Amendment Number One to Loan and Security Agreement, dated as of
July 28, 1997, by that certain Consent and Amendment number Two to Loan and
Security Agreement, dated as of August 29, 1997, by that certain Consent and
Amendment Number Three to Loan and Security Agreement, dated as of September 10,
1997, and by that certain Consent and Amendment Number Four to Loan and Security
Agreement, of even date herewith (as amended, the "Loan Agreement");
WHEREAS, Pledgor has entered into that certain Stock Purchase
Agreement dated as of December 1, 1997 (the "Stock Purchase Agreement") whereby
Pledgor has sold all of the issued and outstanding common stock held by Pledgor
in MEC and LSI to Vision Twenty-One, Inc., a Florida corporation ("Vision");
WHEREAS, Borrower has requested that Foothill consent to the sale
by Pledgor of all of the issued and outstanding capital stock of MEC and LSI to
Vision for a total purchase price of $13,000,000, payable $6,500,000 in cash at
closing to occur on the date hereof, and the balance of $6,500,000 (subject to
adjustment as described in the Stock Purchase Agreement) to be paid between the
date hereof and May 29, 1998 through Pledgor's disposition, on a periodic basis,
pursuant to the terms of the certain Stock Distribution Agreement between
Pledgor and Vision dated as of December 30, 1997 (the "Distribution Agreement"),
of shares of Vision's common stock received from Vision at the closing (the
"Vision Pledged Shares") as more fully described on Schedule A attached hereto,
(subject to $1,000,000 of the Vision Pledged Shares (the "Escrow Shares") being
retained by Vision subject to an Escrow Agreement between Pledgor and Vision
dated as of December 30, 1997 (the "Escrow Agreement") to effect certain stock
purchase consideration adjustments set forth in Section 2.5 of the Stock
Purchase Agreement) and, in the event that Pledgor has not received $6,500,000
through the disposition of the Vision Pledged Shares on or before May 29, 1998
(subject to adjustment as described in the Stock Purchase Agreement), Vision
will pay the amount of any such shortfall on such date to Pledgor in cash; that
<PAGE>
Foothill further agrees to a waiver of compliance by Borrower with the Financial
Covenants as set forth in the Loan Agreement until June 15, 1998; that the Loan
Agreement be amended to delete MEC and LSI as borrowers thereunder and that all
other Loan Documents, including, but not limited to, the Stock Pledge Agreement,
the Copyright Security Agreement, the Patent Security Agreement, the Trademark
Security Agreement, and the Suretyship Agreement, in each case between the
Borrower and Foothill and dated as of March 31, 1997, be simultaneously amended
to delete MEC and LSI as parties thereto; and that Foothill further agree to
release its lien of the capital stock and assets of each of MEC and LSI and to
amend all filed financing statements to delete MEC and LSI as debtors (the
foregoing hereinafter referred to as the "Transaction").
WHEREAS, as a condition precedent to Foothill's consent to the
Transaction, Foothill requires that the Borrower, out of the initial cash
proceeds received by it from the Transaction, reduce the amount outstanding
under the Term Loan as of the date hereof by $2,000,000, with the balance of the
Term Loan to be repaid on or before June 15, 1998, out of the proceeds received
from Pledgor's disposition of the Vision Pledged Shares after Pledgor has
received $2,500,000 of such proceeds; that the Borrower, also out of the initial
cash proceeds from the Transaction, repay all Revolving Advances outstanding as
of the date hereof; and that the Loan Agreement be amended to change the Maximum
Revolver Amount from $4,000,000 to $2,000,000, with all Revolving Advances being
fully repaid and the Loan Agreement terminated as of June 15, 1998.
WHEREAS, to induce Secured Party to consent to the Transaction,
Pledgor desires to pledge, grant, transfer, and assign to Secured Party a
security interest in the Collateral (as hereinafter defined) to secure the
Secured Obligations (as hereinafter defined), as provided herein.
NOW, THEREFORE, in consideration of the mutual promises,
covenants, representations, and warranties set forth herein and for other good
and valuable consideration, the parties hereto agree as follows:
1. Definitions and Construction.
(A) Definitions. All initially capitalized terms used herein
and not otherwise defined herein shall have the meaning ascribed thereto in the
Loan Agreement. As used in this Agreement:
"Agreement" shall mean this Stock Pledge Agreement.
"Borrower" shall have the meaning set forth in the
recitals to this Agreement.
"Chief Executive Office" shall mean where Pledgor is
deemed located pursuant to ss.9-103(3)(d) of the Code.
<PAGE>
"Code" means the California Uniform Commercial Code.
"Collateral" shall mean the Vision Pledged Shares,
including, but not limited to, the Escrow Shares, the Future Rights, and the
Proceeds, collectively.
"Future Rights" shall mean: (a) all shares of stock (other
than Vision Pledged Shares) of Borrower, and all securities convertible or
exchangeable into, and all warrants, options, or other rights to purchase,
shares of stock of Borrower; and (b) the certificates or instruments
representing such additional shares, convertible or exchangeable securities,
warrants, and other rights and all dividends, cash, options, warrants, rights,
instruments, and other property or proceeds from time to time received,
receivable, or otherwise distributed in respect of or in exchange for any or all
of such shares.
"Holder" and "Holders" shall have the meaning set forth in
Section 3 of this Agreement.
"Lien" shall mean any lien, mortgage, pledge, assignment
(including any assignment of rights to receive payments of money), security
interest, charge, or encumbrance of any kind (including any conditional sale or
other title retention agreement, any lease in the nature thereof, or any
agreement to give any security interest).
"Loan Agreement" shall have the meaning ascribed thereto
in the recitals to this Agreement.
"Loan Documents" means the Loan Agreement, the
Disbursement Letter, the Lockbox Agreements, the Guaranty, the Stock Pledge
Agreement, the Copyright Security Agreement, the Patent Security Agreement, the
Trademark Security Agreement, the Warrant, the Suretyship Agreement, the IBM
Consent, any note or notes executed by a Borrower and payable to Foothill, and
any other agreement entered into, now or in the future, in connection with the
Loan Agreement.
"Pledgor" shall have the meaning set forth in the preamble
to this Agreement.
"Proceeds" shall mean all proceeds (including proceeds of
proceeds) of the Vision Pledged Shares and Future Rights including all: (a)
rights, benefits, distributions, premiums, profits, dividends, interest, cash,
instruments, documents of title, accounts, contract rights, inventory,
equipment, general intangibles, deposit accounts, chattel paper, and other
property from time to time received, receivable, or otherwise distributed in
respect of or in exchange for, or as a replacement of or a substitution for, any
of the Vision Pledged Shares, Future Rights, or proceeds thereof (including any
cash, stock, or other securities or instruments issued after any
<PAGE>
recapitalization, readjustment, reclassification, merger or consolidation with
respect to Borrower and any claims against financial intermediaries under
ss.8-313(2) of the Code or otherwise); (b) "proceeds," as such term is used in
ss.9-306 of the Code; (c) proceeds of any insurance, indemnity, warranty, or
guaranty (including guaranties of delivery) payable from time to time with
respect to any of the Vision Pledged Shares, Future Rights, or proceeds thereof;
(d) payments (in any form whatsoever) made or due and payable to Pledgor from
time to time in connection with any requisition, confiscation, condemnation,
seizure or forfeiture of all or any part of the Vision Pledged Shares, Future
Rights, or proceeds thereof; and (e) other amounts from time to time paid or
payable under or in connection with any of the Vision Pledged Shares, Future
Rights, or proceeds thereof.
"Revolving Advances" shall mean advances made by Secured
Party to Borrower pursuant to Section 2.1 of the Loan Agreement.
"Secured Obligations" shall mean all liabilities,
obligations, or undertakings owing by Borrower to Secured Party of any kind or
description arising out of or outstanding under, advanced or issued pursuant to,
or evidenced by the Loan Agreement, the other Loan Documents, or this Agreement,
irrespective of whether for the payment of money, whether direct or indirect,
absolute or contingent, due or to become due, voluntary or involuntary, whether
now existing or hereafter arising, and including all interest (including
interest that accrues after the filing of a case under the Bankruptcy Code) and
any and all costs, fees (including attorneys fees), and expenses which Borrower
is required to pay pursuant to any of the foregoing, by law, or otherwise.
"Secured Party" shall have the meaning set forth in the
preamble to this Agreement, together with its successors or assigns.
"Securities Act" shall have the meaning set forth in
Section 9(c) of this Agreement.
"Stock Purchase Agreement" shall have the meaning set
forth in the recitals of this Agreement.
"Term Loan" shall mean the term loan by Secured Party to
Borrower pursuant to Section 2.3 of the Loan Agreement.
"Transaction" shall have the meaning set forth in the
recitals to this Agreement.
"Vision Pledged Shares" shall mean all of the shares
described in the recitals to this Agreement including, but not limited to, the
Escrow Shares.
<PAGE>
"Vision Stock Distribution Agreement" shall mean that
certain Stock Distribution Agreement dated as of December 30, 1997 entered into
between Pledgor and Vision.
(B) Construction.
(I) Unless the context of this Agreement clearly
requires otherwise, references to the plural include the singular and to the
singular include the plural, the part includes the whole, the term "including"
is not limiting, and the term "or" has, except where otherwise indicated, the
inclusive meaning represented by the phrase "and/or." The words "hereof,"
"herein," "hereby," "hereunder," and other similar terms in this Agreement refer
to this Agreement as a whole and not exclusively to any particular provision of
this Agreement. Article, section, subsection, exhibit, and schedule references
are to this Agreement unless otherwise specified. All of the exhibits or
schedules attached to this Agreement shall be deemed incorporated herein by
reference. Any reference to any of the following documents includes any and all
alterations, amendments, restatements, extensions, modifications, renewals, or
supplements thereto or thereof, as applicable: this Agreement, the Loan
Agreement, or any of the other Loan Documents.
(II) Neither this Agreement nor any uncertainty or
ambiguity herein shall be construed or resolved against Secured Party or
Pledgor, whether under any rule of construction or otherwise. On the contrary,
this Agreement has been reviewed by both of the parties and their respective
counsel and shall be construed and interpreted according to the ordinary meaning
of the words used so as to fairly accomplish the purposes and intentions of the
parties hereto.
(III) In the event of any direct conflict between the
express terms and provisions of this Agreement and of the Loan Agreement, the
terms and provisions of the Loan Agreement shall control.
2. Pledge. As security for the prompt payment and performance of
the Secured Obligations in full by Borrower when due, whether at stated
maturity, by acceleration or otherwise (including amounts that would become due
but for the operation of the provisions of the Bankruptcy Code), Pledgor hereby
pledges, grants, transfers, and assigns to Secured Party a security interest in
all of Pledgor's right, title, and interest in and to the Collateral subject in
all respects to the Vision Stock Distribution Agreement.
<PAGE>
3. Delivery and Registration of Collateral.
(A) Upon receipt by Pledgor, all certificates or instruments
representing or evidencing the Collateral shall be promptly delivered by Pledgor
to Secured Party or Secured Party's designee pursuant hereto at a location
designated by Secured Party and shall be held by or on behalf of Secured Party
pursuant hereto, and shall be in suitable form for transfer by delivery, or
shall be accompanied by duly executed instruments of transfer or assignment in
blank, all in form and substance satisfactory to Secured Party.
(B) After the occurrence and during the continuance of an
Event of Default, Secured Party shall have the right, at any time in its
discretion and without notice to Pledgor, to transfer to or to register on the
books of Borrower (or of any other Person maintaining records with respect to
the Collateral) in the name of Secured Party or any of its nominees any or all
of the Collateral. In addition, Secured Party shall have the right at any time
to exchange certificates or instruments representing or evidencing Collateral
for certificates or instruments of smaller or larger denominations.
(C) If, at any time and from time to time, any Collateral
(including any certificate or instrument representing or evidencing any
Collateral) is in the possession of a Person other than Secured Party or Pledgor
(a "Holder"), then Pledgor shall immediately, at Secured Party's option, either
cause such Collateral to be delivered into Secured Party's possession, or
execute and deliver to such Holder a written notification/instruction, and take
all other steps necessary to perfect the security interest of Secured Party in
such Collateral, including obtaining from such Holder a written acknowledgement
that such Holder holds such Collateral for Secured Party, all pursuant to
ss.ss.8-313 and 8-321 of the Code or other applicable law governing the
perfection of Secured Party's security interest in the Collateral in the
possession of such Holder. Each such notification/instruction and
acknowledgement shall be in form and substance satisfactory to Secured Party.
(D) Any and all Collateral (including dividends, interest, and
other cash distributions) at any time received or held by Pledgor shall be so
received or held in trust for Secured Party, shall be segregated from other
funds and property of Pledgor and shall be forthwith delivered to Secured Party
in the same form as so received or held, with any necessary endorsements;
provided that cash dividends or distributions received by Pledgor, if and to the
extent they are not prohibited by the Loan Agreement, may be retained by Pledgor
in accordance with Section 4 and used in the ordinary course of Pledgor's
business.
(E) If at any time and from time to time any Collateral
consists of an uncertificated security or a security in book entry form, then
Pledgor shall immediately cause such Collateral to be registered or entered, as
<PAGE>
the case may be, in the name of Secured Party, or otherwise cause Secured
Party's security interest thereon to be perfected in accordance with applicable
law.
4. Voting Rights and Dividends.
(A) So long as no Event of Default shall have occurred and be
continuing, Pledgor shall be entitled to exercise any and all voting and other
consensual rights pertaining to the Collateral or any part thereof for any
purpose not inconsistent with the terms of the Loan Documents and shall be
entitled to receive and retain any cash dividends or distributions paid in
respect of the Collateral.
(B) Upon the occurrence and during the continuance of an Event
of Default, all rights of Pledgor to exercise the voting and other consensual
rights or receive and retain cash dividends or distributions that it would
otherwise be entitled to exercise or receive and retain, as applicable pursuant
to Section 4(a), shall cease, and all such rights shall thereupon become vested
in Secured Party, who shall thereupon have the sole right to exercise such
voting or other consensual rights and to receive and retain such cash dividends
and distributions. Pledgor shall execute and deliver (or cause to be executed
and delivered) to Secured Party all such proxies and other instruments as
Secured Party may reasonably request for the purpose of enabling Secured Party
to exercise the voting and other rights which it is entitled to exercise and to
receive the dividends and distributions that it is entitled to receive and
retain pursuant to the preceding sentence.
5. Representations and Warranties. Pledgor represents, warrants,
and covenants as follows:
(A) Pledgor has taken all steps it deems necessary or
appropriate to be informed on a continuing basis of changes or potential changes
affecting the Collateral (including rights of conversion and exchange, rights to
subscribe, payment of dividends, reorganizations or recapitalization, tender
offers and voting rights), and Pledgor agrees that Secured Party shall have no
responsibility or liability for informing Pledgor of any such changes or
potential changes or for taking any action or omitting to take any action with
respect thereto;
(B) All information herein or hereafter supplied to Secured
Party by or on behalf of Pledgor in writing with respect to the Collateral is,
or in the case of information hereafter supplied will be, accurate and complete
in all material respects;
(C) Pledgor is and will be the sole legal and beneficial owner
of the Collateral (including the Vision Pledged Shares and all other Collateral
acquired by Pledgor after the date hereof) free and clear of any adverse claim,
Lien, or other right, title, or interest of any party; provided, however,
Secured Party acknowledges and agrees that the Escrow Shares are subject to
adjustment as described in the Stock Purchase Agreement;
<PAGE>
(D) This Agreement, and the delivery to Secured Party of the
Vision Pledged Shares representing Collateral (or the delivery to all Holders of
the Vision Pledged Shares representing Collateral of the
notification/instruction referred to in Section 3 of this Agreement), creates a
valid, perfected, and first priority security interest in one hundred percent
(100%) of the Vision Pledged Shares, not including the Escrow Shares, in favor
of Secured Party securing payment of the Secured Obligations, and all actions
necessary to achieve such perfection have been duly taken;
(E) Schedule A to this Agreement is true and correct and
complete in all material respects; without limiting the generality of the
foregoing: (i) all the Vision Pledged Shares are in certificated form, and,
except to the extent registered in the name of Secured Party or its nominee
pursuant to the provisions of this Agreement, are registered in the name of
Pledgor; and (ii) as of the date hereof the Vision Pledged Shares constitute at
least the percentage of all the fully diluted issued and outstanding shares of
stock of Vision as set forth in Schedule A to this Agreement;
(F) There are no presently existing Future Rights or Proceeds
owned by Pledgor;
(G) To the best of Pledgor's knowledge, the Vision Pledged
Shares have been duly authorized and validly issued and are fully paid and
nonassessable; and
(H) Neither the pledge of the Collateral pursuant to this
Agreement nor the extensions of credit represented by the Secured Obligations
violates Regulation G, T, U or X of the Board of Governors of the Federal
Reserve System.
<PAGE>
6. Further Assurances.
(A) Pledgor agrees that from time to time, at the expense of
Pledgor, Pledgor will promptly execute and deliver all further instruments and
documents, and take all further action that may be necessary or reasonably
desirable, or that Secured Party may request, in order to perfect and protect
any security interest granted or purported to be granted hereby or to enable
Secured Party to exercise and enforce its rights and remedies hereunder with
respect to any Collateral. Without limiting the generality of the foregoing,
Pledgor will: (i) at the request of Secured Party, mark conspicuously each of
its records pertaining to the Collateral with a legend, in form and substance
reasonably satisfactory to Secured Party, indicating that such Collateral is
subject to the security interest granted hereby; (ii) execute and file such
financing or continuation statements, or amendments thereto, and such other
instruments or notices, as may be necessary or reasonably desirable, or as
Secured Party may request, in order to perfect and preserve the security
interests granted or purported to be granted hereby; (iii) allow inspection of
the Collateral by Secured Party or Persons designated by Secured Party; and (iv)
appear in and defend any action or proceeding that may affect Pledgor's title to
or Secured Party's security interest in the Collateral.
(B) Pledgor hereby authorizes Secured Party to file one or
more financing or continuation statements, and amendments thereto, relative to
all or any part of the Collateral without the signature of Pledgor where
permitted by law. A carbon, photographic, or other reproduction of this
Agreement or any financing statement covering the Collateral or any part thereof
shall be sufficient as a financing statement where permitted by law.
(C) Pledgor will furnish to Secured Party, upon the request of
Secured Party: (i) a certificate executed by an authorized officer of Pledgor,
and dated as of the date of delivery to Secured Party, itemizing in such detail
as Secured Party may request, the Collateral which, as of the date of such
certificate, has been delivered to Secured Party by Pledgor pursuant to the
provisions of this Agreement; and (ii) such statements and schedules further
identifying and describing the Collateral and such other reports in connection
with the Collateral as Secured Party may request.
7. Covenants of Pledgor. Pledgor shall:
(A) Perform each and every covenant in the Loan Documents and
agreements with Vision applicable to Pledgor;
(B) At all times keep at least one complete set of its records
concerning substantially all of the Collateral at its Chief Executive Office as
set forth in Schedule B hereto, and not change the location of its Chief
Executive Office or such records without giving Secured Party at least thirty
(30) days prior written notice thereof; and
<PAGE>
(C) Upon receipt by Pledgor of any material notice, report, or
other communication from Vision or any Holder relating to all or any part of the
Collateral, deliver such notice, report or other communication to Secured Party
as soon as possible, but in no event later than five (5) days following the
receipt thereof by Pledgor.
8. Secured Party as Pledgor's Attorney-in-Fact.
(A) Pledgor hereby irrevocably appoints Secured Party as
Pledgor's attorney-in-fact, with full authority in the place and stead of
Pledgor and in the name of Pledgor, Secured Party or otherwise, from time to
time at Secured Party's discretion, to take any action and to execute any
instrument that Secured Party may reasonably deem necessary or advisable to
accomplish the purposes of this Agreement, including: (i) after the occurrence
and during the continuance of an Event of Default, to receive, endorse, and
collect all instruments made payable to Pledgor representing any dividend,
interest payment or other distribution in respect of the Collateral or any part
thereof to the extent permitted hereunder and to give full discharge for the
same and to execute and file governmental notifications and reporting forms;
(ii) to issue any notifications/instructions Secured Party deems necessary
pursuant to Section 3 of this Agreement; or (iii) to arrange for the transfer of
the Collateral on the books of Borrower or any other Person to the name of
Secured Party or to the name of Secured Party's nominee.
(B) In addition to the designation of Secured Party as
Pledgor's attorney-in-fact in subsection (a), Pledgor hereby irrevocably
appoints Secured Party as Pledgor's agent and attorney-in-fact to make, execute
and deliver any and all documents and writings which may be necessary or
appropriate for approval of, or be required by, any regulatory authority located
in any city, county, state or country where Pledgor or any other Borrower engage
in business, in order to transfer or to more effectively transfer any of the
Vision Pledged Shares or otherwise enforce Secured Party's rights hereunder.
<PAGE>
9. Remedies upon Default. Upon the occurrence and during the
continuance of an Event of Default and subject to the terms and conditions of
the Vision Stock Distribution Agreement:
(A) Secured Party may exercise in respect of the Collateral,
in addition to other rights and remedies provided for herein or otherwise
available to it, all the rights and remedies of a secured party on default under
the Code (irrespective of whether the Code applies to the affected items of
Collateral), and Secured Party may also without notice (except as specified
below) sell the Collateral or any part thereof in one or more parcels at public
or private sale, at any exchange, broker's board or at any of Secured Party's
offices or elsewhere, for cash, on credit or for future delivery, at such time
or times and at such price or prices and upon such other terms as Secured Party
may deem commercially reasonable, irrespective of the impact of any such sales
on the market price of the Collateral. To the maximum extent permitted by
applicable law, Secured Party may be the purchaser of any or all of the
Collateral at any such sale and shall be entitled, for the purpose of bidding
and making settlement or payment of the purchase price for all or any portion of
the Collateral sold at any such public sale, to use and apply all or any part of
the Secured Obligations as a credit on account of the purchase price of any
Collateral payable at such sale. Each purchaser at any such sale shall hold the
property sold absolutely free from any claim or right on the part of Pledgor,
and Pledgor hereby waives (to the extent permitted by law) all rights of
redemption, stay, or appraisal that it now has or may at any time in the future
have under any rule of law or statute now existing or hereafter enacted. Pledgor
agrees that, to the extent notice of sale shall be required by law, at least ten
(10) calendar days notice to Pledgor of the time and place of any public sale or
the time after which a private sale is to be made shall constitute reasonable
notification. Secured Party shall not be obligated to make any sale of
Collateral regardless of notice of sale having been given. Secured Party may
adjourn any public or private sale from time to time by announcement at the time
and place fixed therefor, and such sale may, without further notice, be made at
the time and place to which it was so adjourned. To the maximum extent permitted
by law, Pledgor hereby waives any claims against Secured Party arising because
the price at which any Collateral may have been sold at such a private sale was
less than the price that might have been obtained at a public sale, even if
Secured Party accepts the first offer received and does not offer such
Collateral to more than one offeree.
(B) Pledgor hereby agrees that any sale or other disposition
of the Collateral conducted in conformity with reasonable commercial practices
of banks, insurance companies, or other financial institutions in the City of
Los Angeles, California in disposing of property similar to the Collateral shall
be deemed to be commercially reasonable.
(C) Pledgor hereby acknowledges that the sale by Secured Party
of any Collateral pursuant to the terms hereof in compliance with the Securities
Act of 1933 as now in effect or as hereafter amended, or any similar statute
<PAGE>
hereafter adopted with similar purpose or effect (the "Securities Act"), as well
as applicable "Blue Sky" or other state securities laws may require strict
limitations as to the manner in which Secured Party or any subsequent transferee
of the Collateral may dispose thereof. Pledgor acknowledges and agrees that in
order to protect Secured Party's interest it may be necessary to sell the
Collateral at a price less than the maximum price attainable if a sale were
delayed or were made in another manner, such as a public offering under the
Securities Act. Pledgor has no objection to sale in such a manner and agrees
that Secured Party shall have no obligation to obtain the maximum possible price
for the Collateral. Without limiting the generality of the foregoing, Pledgor
agrees that, upon the occurrence and during the continuation of an Event of
Default, Secured Party may, subject to applicable law, from time to time attempt
to sell all or any part of the Collateral by a private placement, restricting
the bidders and prospective purchasers to those who will represent and agree
that they are purchasing for investment only and not for distribution. In so
doing, Secured Party may solicit offers to buy the Collateral or any part
thereof for cash, from a limited number of investors deemed by Secured Party, in
its reasonable judgment, to be institutional investors or other responsible
parties who might be interested in purchasing the Collateral. If Secured Party
shall solicit such offers, then the acceptance by Secured Party of one of the
offers shall be deemed to be a commercially reasonable method of disposition of
the Collateral.
(D) If Secured Party shall determine to exercise its right to
sell all or any portion of the Collateral pursuant to this Section, Pledgor
agrees that, upon request of Secured Party, Pledgor will, at the expense of
Secured Party, if so requested:
(I) use its reasonable efforts to execute and deliver,
and request that Vision and the directors and officers thereof execute and
deliver, all such instruments and documents, and to do or cause to be done all
such other acts and things, as may be necessary or, in the opinion of Secured
Party, advisable to register such Collateral under the provisions of the
Securities Act, and to cause the registration statement relating thereto to
become effective and to remain effective for such period as prospectuses are
required by law to be furnished, and to make all amendments and supplements
thereto and to the related prospectuses which, in the opinion of Secured Party,
are necessary or advisable, all in conformity with the requirements of the
Securities Act and the rules and regulations of the Securities and Exchange
Commission applicable thereto;
(II) use its reasonable efforts to qualify the
Collateral under the state securities laws or "Blue Sky" laws and to obtain all
necessary governmental approvals for the sale of the Collateral, as requested by
Secured Party;
(III) request that Vision make available to their
respective security holders, as soon as practicable, an earnings statement which
will satisfy the provisions of Section 11(a) of the Securities Act;
<PAGE>
(IV) execute and deliver, or cause the officers and
directors of Vision to execute and deliver, to any person, entity or
governmental authority as Secured Party may choose, any and all documents and
writings which, in Secured Party's reasonable judgment, may be necessary or
appropriate for approval, or be required by, any regulatory authority located in
any city, county, state or country where Pledgor or Vision engage in business,
in order to transfer or to more effectively transfer the Vision Pledged Shares
or otherwise enforce Secured Party's rights hereunder; and
(V) do or cause to be done all such other acts and
things as may be necessary to make such sale of the Collateral or any part
thereof valid and binding and in compliance with applicable law.
Pledgor acknowledges that there is no adequate remedy at law for failure by it
to comply with the provisions of this Section and that such failure would not be
adequately compensable in damages, and therefore agrees that its agreements
contained in this Section may be specifically enforced.
(E) PLEDGOR EXPRESSLY WAIVES TO THE MAXIMUM EXTENT PERMITTED
BY LAW: (i) ANY CONSTITUTIONAL OR OTHER RIGHT TO A JUDICIAL HEARING PRIOR TO THE
TIME SECURED PARTY DISPOSES OF ALL OR ANY PART OF THE COLLATERAL AS PROVIDED IN
THIS SECTION; (ii) ALL RIGHTS OF REDEMPTION, STAY, OR APPRAISAL THAT IT NOW HAS
OR MAY AT ANY TIME IN THE FUTURE HAVE UNDER ANY RULE OF LAW OR STATUTE NOW
EXISTING OR HEREAFTER ENACTED; AND (iii) EXCEPT AS SET FORTH IN SUBSECTION (a)
OF THIS SECTION, ANY REQUIREMENT OF NOTICE, DEMAND, OR ADVERTISEMENT FOR SALE.
10. Application of Proceeds. After the occurrence and during the
continuance of an Event of Default, any cash held by Secured Party as Collateral
and all cash proceeds received by Secured Party in respect of any sale of,
collection from, or other realization upon all or any part of the Collateral
pursuant to the exercise by Secured Party of its remedies as a secured creditor
as provided in Section 9 shall be applied from time to time by Secured Party as
provided in the Loan Agreement.
11. Duties of Secured Party. The powers conferred on Secured
Party hereunder are solely to protect its interests in the Collateral and shall
not impose on it any duty to exercise such powers. Except as provided in Section
9-207 of the Code, Secured Party shall have no duty with respect to the
Collateral or any responsibility for taking any necessary steps to preserve
rights against any Persons with respect to any Collateral.
12. Choice of Law and Venue. THE VALIDITY OF THIS AGREEMENT, ITS
CONSTRUCTION, INTERPRETATION, AND ENFORCEMENT, AND THE RIGHTS OF THE PARTIES
HERETO SHALL BE DETERMINED UNDER, GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH
<PAGE>
THE LAWS OF THE STATE OF CALIFORNIA. THE PARTIES AGREE THAT ALL ACTIONS OR
PROCEEDINGS ARISING IN CONNECTION WITH THIS AGREEMENT SHALL BE TRIED AND
LITIGATED ONLY IN THE STATE AND FEDERAL COURTS LOCATED IN THE COUNTY OF LOS
ANGELES, STATE OF CALIFORNIA OR, AT THE SOLE OPTION OF SECURED PARTY, IN ANY
OTHER COURT IN WHICH SECURED PARTY SHALL INITIATE LEGAL OR EQUITABLE PROCEEDINGS
AND WHICH HAS SUBJECT MATTER JURISDICTION OVER THE MATTER IN CONTROVERSY. EACH
OF PLEDGOR AND SECURED PARTY WAIVES, TO THE EXTENT PERMITTED UNDER APPLICABLE
LAW, ANY RIGHT EACH MAY HAVE TO ASSERT THE DOCTRINE OF FORUM NON CONVENIENS OR
TO OBJECT TO VENUE TO THE EXTENT ANY PROCEEDING IS BROUGHT IN ACCORDANCE WITH
THIS SECTION.
13. Amendments; Etc. No amendment or waiver of any provision of
this Agreement nor consent to any departure by Pledgor herefrom shall in any
event be effective unless the same shall be in writing and signed by Secured
Party, and then such waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given. No failure on the part of
Secured Party to exercise, and no delay in exercising any right under this
Agreement, any other Loan Document, or otherwise with respect to any of the
Secured Obligations, shall operate as a waiver thereof; nor shall any single or
partial exercise of any right under this Agreement, any other Loan Document, or
otherwise with respect to any of the Secured Obligations preclude any other or
further exercise thereof or the exercise of any other right. The remedies
provided for in this Agreement or otherwise with respect to any of the Secured
Obligations are cumulative and not exclusive of any remedies provided by law.
14. Notices. Unless otherwise specifically provided herein, any
notice or other communication herein required or permitted to be given shall be
in writing and shall be delivered in the manner set forth in the Loan Agreement.
15. Continuing Security Interest. This Agreement shall create a
continuing security interest in the Collateral and shall: (i) remain in full
force and effect until the indefeasible payment in full of the Secured
Obligations, including the cash collateralization, expiration, or cancellation
of all Secured Obligations, if any, consisting of letters of credit, and the
full and final termination of any commitment to extend any financial
accommodations under the Loan Agreement; (ii) be binding upon Pledgor and its
successors and assigns; and (iii) inure to the benefit of Secured Party and its
successors, transferees, and assigns. Upon the indefeasible payment in full of
the Secured Obligations, including the cash collateralization, expiration, or
cancellation of all Secured Obligations, if any, consisting of letters of
credit, and the full and final termination of any commitment to extend any
financial accommodations under the Loan Agreement, the security interests
granted herein shall automatically terminate and all rights to the Collateral
shall revert to Pledgor. Upon any such termination, Secured Party will, at
<PAGE>
Pledgor's expense, execute and deliver to Pledgor such documents as Pledgor
shall reasonably request to evidence such termination. Such documents shall be
prepared by Pledgor and shall be in form and substance reasonably satisfactory
to Secured Party.
16. Security Interest Absolute. To the maximum extent permitted
by law, all rights of Secured Party, all security interests hereunder, and all
obligations of Pledgor hereunder, shall be absolute and unconditional
irrespective of:
(A) any lack of validity or enforceability of any of the
Secured Obligations or any other agreement or instrument relating thereto,
including any of the Loan Documents;
(B) any change in the time, manner, or place of payment of, or
in any other term of, all or any of the Secured Obligations, or any other
amendment or waiver of or any consent to any departure from any of the Loan
Documents, or any other agreement or instrument relating thereto;
(C) any exchange, release, or non-perfection of any other
collateral, or any release or amendment or waiver of or consent to departure
from any guaranty for all or any of the Secured Obligations; or
(D) any other circumstances that might otherwise constitute a
defense available to, or a discharge of, Pledgor.
To the maximum extent permitted by law, Pledgor hereby waives any right to
require Secured Party to: (A) proceed against or exhaust any security held from
Pledgor; or (B) pursue any other remedy in Secured Party's power whatsoever.
17. Headings. Section and subsection headings in this Agreement
are included herein for convenience of reference only and shall not constitute a
part of this Agreement or be given any substantive effect.
18. Severability. In case any provision in or obligation under
this Agreement shall be invalid, illegal or unenforceable in any jurisdiction,
the validity, legality and enforceability of the remaining provisions or
obligations, or of such provision or obligation in any other jurisdiction, shall
not in any way be affected or impaired thereby.
19. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original and all of which
together shall constitute one and the same Agreement.
<PAGE>
20. Waiver of Marshaling. Each of Pledgor and Secured Party
acknowledges and agrees that in exercising any rights under or with respect to
the Collateral: (i) Secured Party is under no obligation to marshal any
Collateral; (ii) may, in its absolute discretion, realize upon the Collateral in
any order and in any manner it so elects; and (iii) may, in its absolute
discretion, apply the proceeds of any or all of the Collateral to the Secured
Obligations in any order and in any manner it so elects. Pledgor and Secured
Party waive any right to require the marshaling of any of the Collateral.
21. Waiver of Jury Trial. PLEDGOR AND SECURED PARTY HEREBY WAIVE
THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED
UPON OR ARISING OUT OF THIS AGREEMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED
HEREIN, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL
OTHER COMMON LAW OR STATUTORY CLAIMS. PLEDGOR AND SECURED PARTY REPRESENT THAT
EACH HAS REVIEWED THIS WAIVER AND EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY
TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF
LITIGATION, A COPY OF THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A
TRIAL BY THE COURT.
22. Vision Stock Distribution Agreement. Notwithstanding anything
herein to the contrary, Pledgor may direct Secured Party in writing to sell all
or a portion of the Collateral in accordance with the terms of the Distribution
Agreement specifying the time, place and manner of any such sale and the price
per share for which any of the Collateral is to be sold or otherwise disposed
of. Upon receipt of such direction, Secured Party will sell or cause to be sold
that portion of the Collateral in the manner as directed by Pledgor. The first
$2,500,000 of proceeds from the Collateral received by Secured Party will be
applied as and when collected to the then outstanding Revolving Advances. All
proceeds received after the receipt of the initial $2,500,000 in proceeds shall
be applied by Secured Party as and when collected in repayment of the then
outstanding balance under the Term Loan until the Term Loan is fully repaid. All
proceeds received in excess of the amount necessary to fully repay the Term Loan
will be applied as and when collected to the then outstanding Revolving
Advances.
23. The Escrow Shares. Any Escrow Shares released to Pledgor by
Vision pursuant to the terms of the Escrow Agreement, after the determination of
any stock purchase consideration adjustment pursuant to Section 2.5 of the Stock
Purchase Agreement, shall be immediately delivered or caused to be delivered by
Pledgor to Secured Party subject to this Agreement and Pledgor shall immediately
deliver to Secured Party sufficient stock powers endorsed in black to cover such
released Escrow Shares.
<PAGE>
IN WITNESS WHEREOF, Pledgor and Secured Party have caused this
Agreement to be duly executed and delivered by their officers thereunto duly
authorized as of the date first written above.
FOOTHILL CAPITAL CORPORATION, LASERSIGHT INCORPORATED
a California corporation a Delaware corporation
By /s/ Kent Dahl By /s/ Michael R. Farris
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Title: E.V.P. Title:
