EXHIBIT 2.(i)
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PATENT PURCHASE AGREEMENT
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This PATENT PURCHASE AGREEMENT is made and entered into as of July 15,
1997 by and between LASERSIGHT INCORPORATED, a Delaware corporation
("LaserSight") and XXXXXXXX X. XXXXXX, M.D. ("Xxxxxx").
RECITALS
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A. LaserSight, Photomed Acquisition, Inc., Photomed, Inc. Xxxxxx, and
the other shareholders of Photomed, Inc. entered in an Agreement and Plan of
Merger of even date herewith (the "Merger Agreement").
X. Xxxxxx is the owner of the entire right, title and interest in and
to a certain U.S. letters patent known as patent number 5,586,980, dated
December 24, 1996, pertaining to a microkeratome (the "Patent"), as identified
on Schedule 5.6 attached hereto and made a part hereof.
X. Xxxxxx desires to sell and assign to LaserSight, and LaserSight
desires to purchase from Xxxxxx, all right, title and interest in and to the
Patent and all know-how and information related to the Patent.
THEREFORE, intending to be bound and for good and valuable
consideration, the parties agree as follows:
SECTION 1. TRANSFER OF THE PATENT
1.1 Patent. Xxxxxx shall sell, assign, transfer and convey to
LaserSight, free and clear of any lien, pledge, contract right, security
interest or option, and LaserSight shall purchase and accept (i) the Patent and
any and all reissues, divisionals, continuations, and continuations-in-part
thereof, and (ii) all know-how and confidential technical information related to
the Patent, including, all books, records, files, manuals, plans, specifications
and other information related to the Patent (collectively, the "Patent Assets").
1.2 Transfer of the Patent Assets. The transfer of the Patent Assets
contemplated by this Agreement shall be evidenced by delivery by Xxxxxx to
LaserSight of a Xxxx of Sale substantially in the form attached hereto as
Exhibit A (the "Xxxx of Sale"), a Patent Assignment substantially in the form
attached hereto as Exhibit B (the "Patent Assignment"), and other documents
reasonably necessary to effectuate the transfer contemplated by Section 1.1.
1.3 Evidence of Transfer. At the Closing (as defined herein) and
thereafter, as LaserSight may from time to time reasonably request, Xxxxxx shall
execute and deliver to LaserSight such documents and instruments of conveyance,
which were prepared at LaserSight's cost and expense, as may be appropriate and
Xxxxxx shall take or cause to be taken such actions necessary to effectuate the
transfer contemplated by Section 1.1. All such documents shall be in form and
substance reasonably satisfactory to LaserSight.
1.4 No Further Interest. On and after the Closing Date (as defined
herein) Xxxxxx shall cease to have any right, title or interest in or to the
Patent Assets, except for (i) the rights set forth in this Agreement, and (ii)
the right to use general knowledge gained while developing or using the Patent
in connection with the development of other products and procedures so long as
such use does not violate the terms of any agreement between LaserSight and
Xxxxxx.
SECTION 2. PURCHASE PRICE
2.1 Purchase Price for the Patent. In consideration for the transfer
of the Patent Assets LaserSight agrees as follows:
(a) Cash. At the Closing LaserSight shall pay to Xxxxxx
$333,300.00 via wire transfer of immediately available funds to an account
designated by Xxxxxx (the "Cash Consideration").
(b) LaserSight Common Stock. At the Closing LaserSight shall
deliver to Xxxxxx that number of shares of unregistered, validly issued, fully
paid and nonassessable common stock, $.001 par value, of LaserSight ("LaserSight
Common Stock") which results from dividing (i) $666,700.00, by (ii) the average
closing price of a share of LaserSight common stock for the ten (10) day period
immediately preceding the Closing. The total number of shares of LaserSight
Common Stock issued to Xxxxxx pursuant to this Section 2.1(b) shall be referred
to herein as the "Patent Closing Shares."
(c) Royalty. After the Closing Date LaserSight agrees to pay
Xxxxxx a royalty equal to 30% of the Licensing Fees (as defined herein),
provided that if the aggregate amount of Licensing Fees exceed $1,428,600, then
the royalty payable to Xxxxxx shall increase to 70% of Licensing Fees received
in excess of $1,428,600.00. If the license of the Patent is bundled with
licenses of other patents or intellectual property rights owned by or licensed
to LaserSight, then LaserSight agrees that such a licensing agreement will
specifically state the amount being paid to LaserSight for licensing the Patent
and the royalty payments contemplated by this Section will be calculated based
on such allocated amount. Within 45 days after the end of each of LaserSight's
fiscal quarters which commence after the Closing Date LaserSight will (i)
provide Xxxxxx with a statement setting forth the amount of licensing fees
associated with the Patent which were actually received by LaserSight during
such quarter, and (ii) deliver to Xxxxxx a LaserSight check in the amount any
royalties then due, if any. LaserSight shall use reasonable efforts to license
the Patent.
For purposes hereof, "Licensing Fees " shall mean (i) the gross amount
of any fees LaserSight may receive from licensing the Patent, (ii) the gross
amount of any fees (including, without limitation, royalties) that LaserSight
may receive from any exclusive or co-exclusive license LaserSight grants in
connection with the Patent, (iii) the gross amount of payments that LaserSight
receives from the sale of the Patent, (iv) 3% of the sales price of any
microkeratome which is manufactured by or for LaserSight utilizing the Patent,
and (v) 3% of the sales price of any microkeratome which is manufactured by or
for LaserSight utilizing technology or know how which would be deemed by a court
of competent jurisdiction to infringe the Patent.
If the Patent is bundled with licenses of other patents or
intellectual property rights and Xxxxxx does not agree with the allocation of
the amount paid for the license of the Patent, Xxxxxx and LaserSight will
mutually agree on an independent third party with expertise in the area of
valuing patent license fees (the "Expert") who will review the allocation in
question. If the Expert determines that the allocation in question is not
reasonable in light of current market conditions and the nature of the
transaction in question then LaserSight will pay the fee of the Expert and
Xxxxxx shall promptly receive from LaserSight (i) payment of the royalty amount
that had been miscalculated by LaserSight, (ii) interest thereon at the prime
interest rate stated in the Wall Street Journal plus four percent (4%) per annum
from the date the payment should have originally been made, and (iii)
reimbursement for all reasonable costs and expenses incurred by Xxxxxx in
determining the miscalculation and collecting the amount due (including, without
limitation, reasonable legal fees and costs). If it is determined by the Expert
that the allocation in question is reasonable in light of current market
conditions and the nature of the transaction in question, then Xxxxxx will pay
the fee of the Expert and shall reimburse LaserSight for all reasonable costs
and expenses incurred by LaserSight in connection with the Expert's review of
such allocation (including, without limitation, reasonable legal fees and
costs).
2.2 Transfer of LaserSight Common Stock. All LaserSight Common Stock
issued and delivered pursuant to this Agreement will be authorized but
previously unissued shares of LaserSight Common Stock which have not been
registered under the Securities Act of 1933, as amended (the "Securities Act").
Unless and until otherwise permitted by this Agreement, each certificate of
LaserSight Common Stock issued pursuant to this Agreement shall be stamped or
otherwise imprinted with a legend in substantially the following form:
"These shares have not been registered under the Securities Act
of 1933 and may not be offered for sale, sold, pledged or
otherwise disposed of except pursuant to an effective
registration statement under such Act or pursuant to an exemption
from the registration requirements of such Act. Further, any such
offer, sale, pledge or transfer is subject to the conditions
specified in a Patent Purchase Agreement dated as of July 15,
1997 ("Agreement") delivered in connection with the issuance of
such shares by LaserSight Incorporated, a copy of which Agreement
will be furnished to the holder hereof upon request and without
charge."
2.3 Fractional Shares. No fraction of a share of LaserSight Common
Stock will be issued; therefore, when calculating the number of shares to be
issued pursuant to this Agreement LaserSight shall round to the nearest whole
number, with .500 and greater being rounded up to the next whole number, and
anything less than .500 being rounded down to the next whole number.
SECTION 3. ASSUMPTION OF LIABILITIES.
LaserSight does not and shall not assume, nor will in any way be
liable or responsible for, any liabilities or obligations of Xxxxxx whether
known or unknown, and whether now existing or hereafter accruing, except to the
extent provided in Section 8.
SECTION 4. CLOSING.
4.1. Closing. The closing of the transactions contemplated by this
Agreement (the "Closing") shall take place on July 15, 1997 if the conditions
set forth in Section 7 have been satisfied, or as soon thereafter as such
conditions have either been satisfied or waived by the party benefiting from
such conditions, at the offices of Sonnenschein, Nath & Xxxxxxxxx, Xxx
Xxxxxxxxxxxx Xxxxxx, Xxxxx 0000, Xx. Xxxxx, Xxxxxxxx or at such other place as
the parties shall agree, and shall be effective as of the Effective Time (the
"Closing Date"). At the Closing:
(a) Xxxxxx shall deliver to LaserSight all other previously
undelivered documents required to be delivered by Xxxxxx to LaserSight at or
prior to the Closing pursuant to the terms of this Agreement.
(b) LaserSight shall deliver or cause to be delivered to Xxxxxx the
following:
(i) the Cash Consideration;
(ii) a copy of the letter sent via facsimile on the Closing Date
to LaserSight's transfer agent instructing that the Patent Closing
Shares be issued and delivered to Xxxxxx at the address set forth in
Section 10.6 hereof (the "Transfer Agent Letter"); and
(iii) all other previously undelivered documents required to be
delivered by LaserSight to Xxxxxx at or prior to the Closing pursuant
to the terms of this Agreement.
SECTION 5. REPRESENTATIONS, WARRANTIES AND COVENANTS OF
XXXXXX.
Xxxxxx hereby represents and warrants to LaserSight as of the date
hereof and as of the Closing Date as follows.
5.1 Authority. This Agreement has been duly and validly executed and
delivered by Xxxxxx and, assuming this Agreement constitutes valid and binding
obligations of LaserSight and Xxxxxx, will constitute a valid and binding
obligation of Xxxxxx enforceable against him in accordance with its terms,
except to the extent that such enforcement may be subject to applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect relating to creditors' rights generally, and the remedy of
specific performance and injunctive and other forms of equitable relief may be
subject to equitable defenses and to the discretion of the court before which
any proceeding therefore may be brought. Xxxxxx has the necessary legal capacity
to enter into and perform this Agreement and the other agreements contemplated
hereby.
5.2 No Violation. Neither the execution, delivery nor the performance
by Xxxxxx of this Agreement violates or will violate any provision of any
material law, of any order, judgment or decree of any court or other
governmental or regulatory authority, nor violates or will result in a breach of
or constitute (with due notice or lapse of time or both) a default under any
contract, lease, loan agreement, mortgage, security agreement, trust indenture
or other agreement or instrument to which Xxxxxx is a party or by which he is
bound or to which any of his properties or assets is subject, nor will result in
the creation or imposition of any lien, charge or encumbrance of any kind
whatsoever upon any of the properties or assets of Xxxxxx.
5.3 Consents and Approvals. No consent, waiver, authorization, or
approval of any governmental or regulatory authority, domestic or foreign, or of
any other person, firm or corporation, and no declaration to or filing or
registration with any such governmental or regulatory authority, is required in
connection with the execution and delivery of this Agreement by Xxxxxx or the
performance by Xxxxxx of his obligations hereunder, except that an assignment
form will have to be filed with the United States Patent and Trademark Office to
record the transfer of the Patent.
5.4 Litigation. Except as set forth on Schedule 5.4, there are no
claims, actions, suits, proceedings, disputes or investigations pending or, to
Xxxxxx'x actual knowledge, threatened before any federal, state or local court
or governmental or regulatory authority, domestic or foreign, or before any
arbitrator of any nature, brought by or against Xxxxxx involving, affecting or
relating to any assets, properties or operations of Xxxxxx or the transactions
contemplated by this Agreement which, if determined adversely, would have a
material adverse effect upon Xxxxxx. Neither Xxxxxx nor any of his assets or
properties is subject to any order, writ, judgment, award, injunction or decree
of any federal, state or local court or governmental or regulatory authority or
arbitrator, which could materially and adversely effect the assets, properties,
operations, prospects, net income or financial condition or which would
interfere with the transactions contemplated by this Agreement.
5.5 Title. Xxxxxx is the owner of all right, title and interest in and
to the Patent Assets. Xxxxxx has the legal right to transfer the Patent Assets
as set forth in this Agreement, and Xxxxxx has not executed an agreement which
is in conflict with the terms of this Agreement.
5.6 Patent Protection. Schedule 5.6 represents a complete and accurate
list of all jurisdictions and registration numbers related to such jurisdictions
where the Patent has been registered, or where any continuation or reissue
applications corresponding to the Patent have been filed and there are no other
jurisdictions where the Patent has been registered or an application for
registration has been made.
5.7 Third-Party Rights. Except as provided in Schedule 5.7, Xxxxxx has
not previously used or disclosed the Patent Assets or any part thereof anywhere
in the world, and will not do so without LaserSight's prior consent. Except as
provided in Schedule 5.7, to Xxxxxx'x actual knowledge, no part of the Patent
Assets are being infringed anywhere in the world. The Patent is valid and
enforceable, and to Xxxxxx'x actual knowledge, no part of the Patent will
infringe the rights of any third parties anywhere in the world. Xxxxxx has not
granted any license, right or option in or to any of the Patent Assets.
5.8 Accuracy of Information. None of the representations, warranties
or statements contained in this Agreement, in the exhibits hereto, or in any
other agreement, instrument or document executed or delivered by or on behalf of
Xxxxxx in connection with the transactions contemplated by this Agreement
contains any untrue statement of a material fact or omits to state any material
fact necessary in order to make any of such representations, warranties or
statements not misleading.
5.9 Agreements, Judgments and Decrees. Xxxxxx represents and warrants
that he is not subject to any agreement, judgment or decree which could
materially and adversely affect his ability to satisfy his obligations
hereunder.
5.10 Purchase for Investment; Restricted Securities. Xxxxxx will
acquire the LaserSight Common Stock for his own account for investment purposes
and, except for the registration contemplated by Section 7.7, not with a present
view toward any resale or distribution thereof. Certificates representing the
acquired LaserSight Common Stock shall bear the restrictive legend set forth in
Section 2.2 hereof indicating the absence of registration under the Securities
Act and imposing all applicable transfer restrictions thereon. Xxxxxx
acknowledges that (i) LaserSight Common Stock has not been registered under the
Securities Act, (ii) LaserSight Common Stock cannot be sold, assigned, pledged
or otherwise transferred unless registered or qualified under the Securities Act
and any applicable state securities laws or unless an exemption from such
registration and qualification is available, as established by an opinion of
counsel which is accepted by LaserSight in its sole discretion based upon
applicable law, (iii) except as set forth in Section 7.7 LaserSight is not
required to cause any of LaserSight Common Stock to be registered or qualified
under the Securities Act or any applicable state securities laws, and (iv)
Xxxxxx is prepared to bear the economic risk of an investment in LaserSight
Common Stock for an indefinite period of time.
5.11 LaserSight Common Stock.
(a) Xxxxxx acknowledges the receipt of (i) LaserSight's Proxy
Statement dated May 21, 1997 (filed May 19, 1997), (ii) LaserSight's Annual
Report on Form 10-K for the year ended December 31, 1996, (iii) LaserSight's
Quarterly Report on Form 10-Q for the quarter ended March 31, 1997, (iv)
LaserSight's Current Reports on Form 8-K filed on February 25, March 18, March
27, April 8, April 25 and July 1, 1997, (v) Form 8-A/A (Amendment No. 2) filed
April 26, 1996 describing LaserSight's Common Stock, and (vi) such other
publicly available information relating to LaserSight as was requested by Xxxxxx
(collectively, the "SEC Filings").
(b) Xxxxxx acknowledges that representatives of LaserSight have
responded to all questions of such parties relating to the SEC Filings.
(c) Xxxxxx has relied upon consultations with his or her legal,
financial and other advisers with respect to this transaction, and the nature of
the investment together with the additional information concerning LaserSight
set forth in the SEC Filings.
(d) Xxxxxx has completed, dated and executed an Seller's Certificate
(the "Certificate") substantially in the form attached hereto as Exhibit C, and
the information and representations contained in the Certificate are true and
accurate as of the Closing Date.
(e) The representations and warranties contained in this Section 4.22
shall survive the execution and delivery of this Agreement and the issuance by
LaserSight of the LaserSight Common Stock.
Except as provided in Section 5.6 (i) no representation or warranty is
made by Xxxxxx that the Patent and the Patent Assets do not infringe upon any
person's or entity's patent or patents and LaserSight assumes all risks of
infringement claims by others which (A) relate to the Patent, (B) are made after
the Closing Date, and (C) relate to the period after the Closing Date, and (ii)
no representation or warranty is made by Xxxxxx that the Patent can be developed
for commercial use.
Except as set forth in this Section 5, Xxxxxx does not make any
representation or warranty to LaserSight.
SECTION 6. REPRESENTATIONS AND WARRANTIES OF LASERSIGHT.
LaserSight hereby represents and warrants to Xxxxxx and covenants and
agrees, as of the date hereof and the Closing Date, as follows:
6.1 Corporate Organization. LaserSight is a corporation duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation, with all requisite power and authority
(corporate and other) to own its properties and assets and to conduct its
business as now conducted.
6.2 Corporate Authority. As of the Closing Date, LaserSight will have
the corporate power to enter into this Agreement and to carry out its respective
obligations hereunder and thereunder. As of the Closing Date, the execution and
delivery of this Agreement and all agreements contemplated hereunder and the
performance of LaserSight's obligations hereunder and thereunder, will have been
duly authorized by the Board of Directors of LaserSight, and no other corporate
proceedings on the part of LaserSight will be necessary to authorize such
execution, delivery and performance. This Agreement and all agreements
contemplated hereunder have been duly executed by LaserSight and, as of the
Closing Date, will constitute valid and legally binding obligations of
LaserSight, enforceable against LaserSight in accordance with the terms hereof
and thereof, except to the extent that such enforcement may be subject to
bankruptcy, insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect relating to creditors' rights generally, and the remedy of
specific performance and injunctive and other forms of equitable relief may be
subject to equitable defenses and to the discretion of the court before which
any proceeding therefore may be brought.
6.3 No Violation. Neither the execution, delivery nor the performance
by LaserSight of this Agreement and all agreements contemplated hereunder
violates or will violate any provision of law, of any order, judgment or decree
of any court or other governmental or regulatory authority, or of the charter
documents or by-laws of LaserSight, nor violates or will result in a breach of
or constitute (with due notice or lapse of time or both) a default under any
contract, lease, loan agreement, mortgage, security agreement, trust indenture
or other agreement or instrument to which LaserSight is a party or by which it
is bound or to which any of its properties or assets is subject, nor will result
in the creation or imposition of any lien, charge or encumbrance of any kind
whatsoever upon any of the properties or assets of LaserSight.
6.4 Consents and Approvals. Other than requirements of federal and
state securities laws, no filing or registration with, no notice to and no
permit, authorization, consent or approval of any third party or any public or
governmental body or authority is necessary for the consummation by LaserSight
of the transactions contemplated by this Agreement.
6.5 Litigation. Except for matters expressly disclosed to Xxxxxx in a
writing addressed to Xxxxxx on or prior to the Closing Date or as set forth on
Schedule 5.5, there are no material claims, actions, suits, proceedings,
disputes or investigations pending or, to the best of LaserSight's knowledge,
threatened before any federal, state or local court or governmental or
regulatory authority, domestic or foreign, or before any arbitrator of any
nature, brought by or against LaserSight. Except for matters expressly disclosed
to Xxxxxx in a writing addressed to Xxxxxx on or prior to the Closing Date or as
set forth on Schedule 5.5, neither LaserSight nor any of its assets or
properties is subject to any order, writ, judgment, award, injunction or decree
of any federal, state or local court or governmental or regulatory authority or
arbitrator. As of the date of this Agreement LaserSight is not subject to an FDA
investigation.
6.6 Capitalization. As of May 31, 1997, the authorized capital stock
of LaserSight consisted of (i) 20,000,000 shares of LaserSight Common Stock of
which 9,423,907 shares were issued and outstanding and 170,200 shares were held
in treasury, and (ii) 10,000,000 shares of preferred stock, par value $.001, of
which none are issued and outstanding. No material change in such capitalization
has occurred between May 31, 1997 and the date hereof. The shares of LaserSight
Common Stock to be issued pursuant to this Agreement will be duly authorized,
validly issued, fully paid and nonassessable.
6.7 Accuracy of Information. None of the representations, warranties
or statements contained in the SEC Filings, this Agreement, in the exhibits
hereto or in any other agreement, instrument or document executed or delivered
by or on behalf of LaserSight in connection with the transactions contemplated
by this Agreement contains any untrue statement of a material fact or omits to
state any material fact necessary in order to make any of such representations,
warranties or statements not misleading.
Except as set forth in this Section 6, LaserSight does not make any
representation or warranty to Xxxxxx.
SECTION 7. CONDITIONS AND ADDITIONAL AGREEMENTS.
7.1 IBM Patent. If LaserSight acquires all right, title and interest
in and to United States Patent No. 4,784,135 (the "IBM Patent"), or otherwise
acquires the right to enforce the IBM Patent against infringement, LaserSight
will not assert against Xxxxxx, Eyes of the Future, P.C., a Pennsylvania
professional corporation ("EOTF"), or Xxxxxxxx X. Xxxxxx, M.D., P.C., a
Pennsylvania professional corporation ("PC"), for so long as Xxxxxx maintains an
ownership interest of at least 25% in EOTF and PC, any claim for infringement of
the IBM Patent based on Xxxxxx'x, EOTF's or PC's manufacture, use, sale or offer
to sell any laser described on Schedule 6.7 to the Merger Agreement (the "Xxxxxx
Laser Assets"). LaserSight further covenants that for any lasers purchased or
obtained by Xxxxxx or a Xxxxxx Affiliate (as defined herein) from LaserSight for
use by Xxxxxx or a Xxxxxx Affiliate in connection with the private medical
practice located at 000 Xxxx Xxxxxxxxx, Xxxx xx Xxxxxxx, Xxxxxxxxxxxx (or such
other addresses as may be used by Xxxxxx in connection with his private medical
practice), or by a Xxxxxx Affiliate in connection with a Center or Centers (as
defined in the Merger Agreement), LaserSight will not assert any claim for
infringement of the IBM Patent based on the use of any such LaserSight laser.
The non-assertion clauses of this Section 7.1 apply to normal repairs or
replacement of parts to the Xxxxxx Laser Assets necessary for continued use, but
does not include reconstruction of a worn-out laser. The non-assertion clauses
of this Section 7.1 do not constitute a license or convey any right or interest
in the IBM Patent and is not assignable or otherwise transferable by Xxxxxx,
EOTF, PC or a Xxxxxx Affiliate (collectively, the "Xxxxxx Parties"), provided
that if a laser is subject to the non-assertion clauses of this Section 7.1,
such laser will continue to be subject to such clauses if such laser is
transferred from one of the Xxxxxx Parties to another of the Xxxxxx Parties. For
purposes hereof "Xxxxxx Affiliate" shall mean an entity in which Xxxxxx (i) has
an ownership interest of 40% or greater, or (ii) has the ability to appoint or
elect a majority of the board of directors or similar governing body, for
example, a general partner in a limited partnership or board of managers or
manager in a limited liability company, provided that in no event will the term
"Xxxxxx Affiliate" include an entity in which any ownership interest is held,
directly or indirectly, by an individual or entity which is a competitor of
LaserSight and (i) manufactures or services refractive lasers, or (ii)
distributes or sells refractive lasers on a commercial basis.
7.2 Consignment of Laser. Within 90 days after the Closing Date
LaserSight will deliver to Xxxxxx'x office located at 000 Xxxx Xxxxxxxxx, Xxxx
xx Xxxxxxx, Xxxxxxxxxxxx LaserSight's LaserScan 2000 model refractive laser to
be utilized in connection with LaserSight clinical trials (the "Consignment
Laser"). Within 90 days after the date LaserSight has filled its first three
outstanding purchase orders for LaserSight's LSX model refractive laser,
LaserSight will deliver a LSX model excimer laser to Xxxxxx'x office and remove
the LaserScan 2000 excimer laser and thereafter the LSX model laser will be
considered the Consignment Laser. The parties agree (i) the Consignment Laser
will be labeled for non-human use, (ii) to cooperate in obtaining an
investigational device exemption from the United States Food and Drug
Administration for the Consignment Laser, and (iii) that the Consignment Laser
will remain the property of LaserSight and is only being delivered to Xxxxxx on
a consignment basis.
7.3 Option to Purchase. LaserSight hereby grants Xxxxxx or a Xxxxxx
Affiliate the option to purchase up to a total of four refractive lasers which
are the most advanced model then manufactured by or for LaserSight. This option
will include the scanning laser currently manufactured by LaserSight and the
laser which may be manufactured by LaserSight if the FDA Approval (as defined in
the Merger Agreement) is received. The option to purchase the laser which is the
then most advanced type of laser manufactured by LaserSight will be at a price
of $100,000.00 per laser, provided that the option to purchase the laser which
may be manufactured based on the Xxxxxx Laser as a result of the FDA Approval
will be at a price of $150,000.00. If the option to purchase granted under this
Section 7.3 is not exercised on or before the date which is 36 months after the
date of the FDA Approval (such date to be referred to as the "Option Termination
Date") then such option will expire and will be of no further force or effect.
The terms for the purchase of any laser pursuant to this Section 7.3 shall be as
follows: (i) Xxxxxx shall pay as a deposit ten percent (10%) of the purchase
price for each laser at the time Xxxxxx orders a laser and the balance of the
purchase price within 90 days after Xxxxxx'x or a Xxxxxx Affiliates' receipt
thereof, (ii) LaserSight will use all reasonable efforts to ship such laser
within 30 days after LaserSight's receipt of the deposit associated with such
laser, (iii) the cost of delivery for each laser shall be the responsibility of
Xxxxxx, (iv) each laser will be covered by LaserSight's standard warranty then
in effect for domestic sales at no cost to Xxxxxx or the Xxxxxx Affiliate, as
applicable, and (v) LaserSight shall provide one year of maintenance for each
such laser in accordance with its standard practice at no cost to Xxxxxx or the
Xxxxxx Affiliate, as applicable. LaserSight's obligations under this Section 7.3
shall terminate upon the Termination Date.
7.4 Sale of Lasers. LaserSight agrees that in addition to the options
to purchase described in Section 7.3, after the date of the FDA Approval,
LaserSight, if requested by Xxxxxx or a Xxxxxx Affiliate, will sell additional
lasers to Xxxxxx or a Xxxxxx Affiliate, as the case may be, on the same as or
better Terms (as defined herein) as LaserSight has utilized in the immediately
preceding 12 months when selling other lasers of the same type in the United
States. These Terms will only be offered for lasers which are purchased for
Xxxxxx'x use in connection with his private medical practice located at 000 Xxxx
Xxxxxxxxx, Xxxx xx Xxxxxxx, Xxxxxxxxxxxx (or such other addresses as may be used
by Xxxxxx in connection with his private medical practice) or for the use of a
Xxxxxx Affiliate in connection with a Center or Centers, and neither Xxxxxx nor
any Xxxxxx Affiliate will have the right to assign this right except to one
another. For purposes hereof, "Terms" shall mean (i) purchase price for an equal
quantity of lasers, (ii) amount of down payment, (iii) payment terms, (iv)
length of warranty period, (v) length of maintenance received at no additional
cost, and (vi) type of purchase (e.g., cash purchase, per procedure lease,
etc.). The parties agree that the sale of an excimer laser to Xxxxxx or a Xxxxxx
Affiliate pursuant to Section 7.3 will not be deemed a sale by LaserSight which
grants Xxxxxx or a Xxxxxx Affiliate any right under this Section 7.4.
7.5 Patent Royalties. LaserSight agrees that, unless otherwise
approved in writing in advance by Xxxxxx, LaserSight will only enter into
agreements to license the Patent to a third party which provide for a licensing
fee of five percent (5%) or greater of the ultimate sales price of the
microkeratome manufactured utilizing the Patent.
7.6 Inspection of Records. LaserSight shall maintain complete and
accurate books, accounts, records and other materials used to calculate the
royalty payments described in Section 7.5 in a manner such that the information
contained in the statements referred to in Section 7.5 may be readily
determined. Xxxxxx and/or his duly authorized representatives, shall have the
right to inspect and audit such materials during reasonable business hours and
upon at least 48 hours advance notice to LaserSight. If Xxxxxx'x (or his
representative's) inspection and audit reveals that a miscalculation has been
made in the amount of the royalty, Xxxxxx shall promptly receive from LaserSight
(i) payment of the royalty amount that had been miscalculated by LaserSight,
(ii) interest thereon at the prime interest rate stated in the Wall Street
Journal plus four percent (4%) per annum from the date the payment should have
originally been made, and (iii) reimbursement for all reasonable costs and
expenses incurred by Xxxxxx in determining the miscalculation and collecting the
amount due (including, without limitation, reasonable legal fees and costs). If
it is determined by a court of competent jurisdiction or other neutral party
chosen by the parties to resolve their dispute, that there was no miscalculation
notwithstanding Xxxxxx'x assertion to the contrary, has been made in the amount
of the royalty, then Xxxxxx will reimburse LaserSight for all reasonable costs
and expenses incurred by LaserSight in connection with Xxxxxx'x inspection and
audit (including, without limitation, reasonable legal fees and costs). The
right to audit described in this Section 7.6 shall terminate 90 days after
LaserSight make its final payment of royalty fees to Xxxxxx.
7.7 Registration.
(a) Demand Registration Rights. Upon LaserSight's receipt of a written
request executed by Xxxxxx stating that Xxxxxx desires to sell all or a portion
of the LaserSight Common Stock then held by Xxxxxx (the "Demand Registration
Request"), LaserSight shall, subject to the limitations of this Section 7.7, (i)
promptly file with the Securities and Exchange Commission ("SEC") a registration
statement in compliance with the Securities Act on Form S-3, if available, or
such other appropriate registration form promulgated by the SEC as shall be
selected by LaserSight if Form S-3 is unavailable registering at least the
number of shares of LaserSight Common Stock requested to be registered in the
Demand Registration Request, provided that in no event will LaserSight be
required to register more than the total number of Closing Shares (as defined in
the Merger Agreement) and Patent Closing Shares (the "Demand Registration
Statement"), and (ii) use all commercially reasonable efforts to cause the
Demand Registration Statement to become effective under the Securities Act as
soon as reasonably possible after the filing thereof and remain effective for
150 days or such shorter period as may be required if all such LaserSight Common
Stock covered by the Demand Registration Statement is sold prior to the
expiration of such 90-day period.
Xxxxxx agrees (i) that a Demand Registration Request shall only be
valid if delivered to LaserSight at the same time the Shareholders (as defined
in the Merger Agreement) deliver a similar request pursuant to Section 6.4(a) of
the Merger Agreement, and (ii) subject to the limitations of this Section 7.7,
the Demand Registration Statement related to such Demand Registration Request
will include the Patent Closing Shares and the shares of LaserSight Common Stock
to be registered pursuant to Section 6.4(a) of the Merger Agreement. LaserSight
shall only be obligated to effect one such registration pursuant to this Section
7.7(a) and LaserSight shall not be obligated to effect such registration after
the first anniversary of the Closing Date (provided that a registration
effective on or before such anniversary date shall remain effective for the full
150-day period (or such shorter period as is provided for in this Section
7.7(a)).
(b) Piggy-Back Registration Rights. If during the period commencing on
the Closing Date and concluding on the first anniversary of the Closing Date
LaserSight proposes or is required to file with the SEC a registration statement
under the Securities Act relating to any shares of LaserSight Common Stock
(other than a registration statement on Form S-8 or Form S-4 or any successor
forms thereto, or any registration form that does not permit the inclusion
therein of the Patent Closing Shares) (the "Piggy-Back Registration Statement"),
LaserSight will each such time give prompt written notice of its intention to do
so to Xxxxxx. Upon the written request of Xxxxxx received by LaserSight within
10 days after the delivery or mailing of such notice from LaserSight (the
"Piggy-Back Registration Request"), subject to the limitations of this Section
7.7, LaserSight will use all commercially reasonable efforts to register at
least the number of shares of LaserSight Common Stock then outstanding which are
not then the subject of another registration statement and which are requested
to be registered in the Piggy-Back Registration Request, provided that in no
event will LaserSight, on behalf of Xxxxxx, be required to include in such
registration more than the total number of Closing Shares and Patent Closing
Shares (the "Requested Shares").
Xxxxxx agrees (i) that a Piggy-Back Registration Request shall only be
valid if delivered to LaserSight at the same time the Shareholders deliver a
similar request pursuant to Section 6.4(b) of the Merger Agreement, and (ii)
subject to the limitations of this Section 7.7, the Piggy-Back Registration
Statement related to such Piggy-Back Registration Request will include the
Patent Closing Shares and the shares of LaserSight Common Stock to be registered
pursuant to Section 6.4(b) of the Merger Agreement. Xxxxxx'x right pursuant to
this Section 7.7(b) to receive notice and participate in a Piggy-Back
Registration Statement shall cease on the day after the first anniversary of the
Closing Date.
(c) Limitations. The foregoing notwithstanding, in the event of an
underwritten offering pursuant to Sections 7.7(b), if the managing underwriter
of such offering shall advise LaserSight that, in its opinion, the distribution
of a specified portion of the securities requested to be included in the
Piggy-Back Registration Statement, would materially adversely affect the
distribution of such securities by increasing the aggregate amount of the
offering in excess of the maximum amount of securities which such managing
underwriter believes can reasonably be sold in the contemplated distribution,
then LaserSight may (subject to the limitations set forth below) exclude all
Requested Shares from, or limit the number of Requested Shares to be included in
the Piggy-Back Registration Statement. In such event, LaserSight shall so advise
Xxxxxx, and the number of Requested Shares and other shares ("Other Shares") to
be included in the Piggy-Back Registration Statement by other persons or
entities that are then stockholders of LaserSight ("Other Holders"), after
providing for all shares that LaserSight proposes to offer and sell for its own
account, shall be allocated among Xxxxxx and Other Holders pro rata on the basis
of (i) the sum of (A) the number of Requested Shares then held by Xxxxxx, and
(B) the number of Closing Shares (as defined in the Merger Agreement) then held
by the Shareholders (as defined in the Merger Agreement), and (ii) the aggregate
number of Other Shares then held by Other Holders.
LaserSight shall be entitled to suspend the right of Xxxxxx to sell
any Patent Closing Shares pursuant to a Demand Registration Statement and a
Piggy-Back Registration Statement if the LaserSight Board of Directors ("Board")
determines reasonably and in good faith that such sales pursuant to a Demand
Registration Statement or Piggy-Back Registration Statement, as applicable,
would materially impede, delay or interfere with any material financing, offer
or sale of securities by LaserSight, acquisition, corporate reorganization or
other significant transaction involving LaserSight or any of its subsidiaries,
which material financing, offer or sale of securities, acquisition, corporate
reorganization or other significant transaction is under active consideration by
LaserSight at the time of such suspension described above; provided, however,
that LaserSight shall not be entitled to more than one such suspension and the
suspension shall not be longer than four weeks duration. If LaserSight shall so
suspend Xxxxxx'x right to sell, Xxxxxx shall receive an extension of the
registration period equal to the number of days of the suspension.
(d) Execution of Agreements. If a Demand Registration Statement or
Piggy-Back Registration Statement relates to an underwritten public offering,
LaserSight shall so advise Xxxxxx. In such event, the right of Xxxxxx to
registration shall be conditioned upon Xxxxxx'x execution of the underwriting
agreement agreed to among LaserSight and the managing underwriters selected by
LaserSight for such underwritten offering.
(e) Notice. LaserSight will promptly advise Xxxxxx as to the initial
filing of a Demand Registration Statement or Piggy-Back Registration Statement
and as to the effectiveness thereof. LaserSight will promptly furnish such
number of prospectuses, and any amendments thereof or supplements thereto, as
Xxxxxx from time to time may reasonably request.
(f) Information. Xxxxxx shall from time to time promptly supply to
LaserSight in writing any information relating to any holdings of LaserSight
Common Stock by Xxxxxx, and his intended plan of distribution, all as LaserSight
may reasonably request in order for LaserSight to comply with the rules of the
SEC applicable to the Demand Registration Statement and Piggy-Back Registration
Statement. In addition, Xxxxxx agrees to furnish promptly to LaserSight all
information required to be disclosed in order to make the information previously
furnished to LaserSight by Xxxxxx not materially misleading.
(g) Expenses. All expenses incurred in connection with a Demand
Registration Statement and a Piggy-Back Registration Statement, including
without limitation all filing fees, duplication expenses, fees and expenses of
legal counsel for LaserSight, and the fees and expenses of LaserSight's
independent accountants, shall be paid by LaserSight, except that Xxxxxx shall
pay any and all brokers' or underwriters' fees, commissions and discounts and
any fees and expenses of their legal counsel, if any.
7.8 LaserSight's Conditions to Close. The Closing and all obligations
of LaserSight pursuant to this Agreement shall be conditioned upon the
following:
(a) all representations and warranties contained in Section 5 shall be
true in all material respects as of the Closing Date;
(b) there shall not have been any material adverse change in the
Patent Assets (either individually or in the aggregate) from the date of
LaserSight's execution of this Agreement through the Closing Date if the date of
execution of this Agreement and the Closing Date are not one and the same;
(c) Xxxxxx shall have performed all of his obligations under this
Agreement required to be performed as of the Closing Date;
(d) no suit, action or other proceeding shall have been instituted to
restrain, enjoin or otherwise prevent or question the legality of the
consummation of the transactions contemplated by this Agreement;
(e) LaserSight shall have received an executed original of the Merger
Agreement and all documents contemplated thereby;
(f) LaserSight shall have received an executed original of the Patent
Assignment from Xxxxxx;
(g) LaserSight shall have received an executed original of the
Certificate from Xxxxxx;
(h) Foothill Capital Corporation shall have taken all necessary action
to authorize the execution, delivery and performance of this Agreement and the
transactions contemplated hereby; and
(i) The Board of Directors of LaserSight, or the appropriate committee
thereof, shall have taken all necessary action to authorize the execution,
delivery and performance of this Agreement and the transactions contemplated
hereby.
In the event that any of the foregoing conditions is not satisfied, then
LaserSight may, at its option, terminate this Agreement in which event
LaserSight shall be relieved of all obligations hereunder, so long as it is not
in breach of this Agreement at such time, and this Agreement shall be deemed
null, void and of no force or effect.
7.9 LaserSight's Deliveries. At or prior to the Closing, LaserSight
shall deliver to Xxxxxx:
(a) the Cash Consideration; and
(b) the Transfer Agent Letter.
7.10 Xxxxxx'x Conditions To Close. The Closing and all obligations of
Xxxxxx pursuant to this Agreement shall be conditioned upon the following:
(a) all representations and warranties contained in Section 6 shall be
true as of the Closing Date;
(b) LaserSight shall have performed all of its obligations under this
Agreement required to be performed as of the Closing Date;
(c) no suit, action or other proceeding shall have been instituted to
restrain, enjoin or otherwise prevent or question the legality of the
consummation of the transactions contemplated by this Agreement; and
(d) Xxxxxx shall have received an executed original of the Merger
Agreement and the Consulting Agreement.
In the event Xxxxxx believes that any of the foregoing conditions is not
satisfied, then Xxxxxx may, at his option, terminate this Agreement in which
event Xxxxxx shall be relieved of all obligations hereunder, so long as he is
not in breach of this Agreement at such time, and this Agreement shall be deemed
null, void and of no force or effect.
7.11 Xxxxxx'x Deliveries. At or prior to the Closing, Xxxxxx shall
deliver to LaserSight the following documents:
(a) the Xxxx of Sale, conveying all of Xxxxxx'x right, title and
interest in the Patent Assets;
(b) The Patent Assignment;
(c) all such documents and instruments LaserSight and its counsel may
reasonably request in connection with the consummation of the transactions
contemplated by this Agreement; and
(d) An executed original of the Certificate.
SECTION 8. TERMINATION AND ABANDONMENT.
8.1 Methods of Termination. This Agreement may be terminated and the
transactions contemplated hereby may be abandoned at any time prior to the
Closing:
(a) By the mutual written consent of Xxxxxx and LaserSight;
(b) By LaserSight, if all of the conditions set forth in Section 7.8
of this Agreement shall not have been satisfied or waived on or prior to the
Closing Date;
(c) By Xxxxxx, if all of the conditions set forth in Section 7.10 of
this Agreement shall not have been satisfied or waived on or prior to the
Closing Date; or
(d) By Xxxxxx or LaserSight at any time after August 31, 1997.
If this Agreement is terminated pursuant to this Section 8.1, it shall become
null and void and of no further force or effect, except as provided in Section
8.2.
8.2 Procedure Upon Termination. In the event of termination and
abandonment of this Agreement by Xxxxxx or LaserSight pursuant to Section 8.1
hereof, written notice thereof shall forthwith be given to the other party or
parties as provided herein and this Agreement shall terminate and the
transactions contemplated hereby shall be abandoned, without further action by
Xxxxxx or LaserSight, and Xxxxxx and LaserSight shall each return to the other
party any documents or copies thereof in possession of such party furnished by
such other party in connection with the transactions contemplated by this
Agreement. If this Agreement is terminated as provided herein, no party to this
Agreement shall have any liability or further obligation to any other party to
this Agreement with respect to this Agreement or the transactions contemplated
hereby except as provided in this Section 8.2; provided, however, that no
termination of this Agreement pursuant to the provisions of this Section 8 shall
relieve any party of liability for a breach of any provision of this Agreement
occurring prior to such termination.
SECTION 9. INDEMNIFICATION.
9.1 Indemnification.
(a) From and after the Closing Date and subject to the other
provisions of this Section 9, Xxxxxx agrees to indemnify and hold LaserSight and
LaserSight's affiliates, officers, directors and agents harmless from damages,
losses or expenses suffered or paid, directly or indirectly ("Loss"), as a
result of any and all claims, demands, suits, causes of action, proceedings,
judgments and liabilities, including reasonable counsel fees and other expenses
incurred in litigation or otherwise, assessed, incurred or sustained
(collectively "LaserSight Loss") by or against any of them with respect to or
arising out of (i) the failure of any representation or warranty made by Xxxxxx
in this Agreement or in any Schedule delivered pursuant hereto to be true and
correct in all material respects as of the date of this Agreement as of the
Closing Date, (ii) claims of third parties that microkeratomes manufactured by
Xxxxxx prior to the Closing Date which are based on the Patent and its related
know-how infringes on the rights or properties of such third party, and (iii)
the breach by or nonperformance of Xxxxxx of any covenants or agreements
contained in this Agreement, provided that the indemnification covenant
contained in this Section will not require Xxxxxx to indemnify in connection
with consequential damages sustained by the parties eligible for indemnification
hereunder.
(b) From and after the Closing Date and subject to the other
provisions of this Section 9, LaserSight agrees to indemnify and hold Xxxxxx
harmless from damages, losses or expenses suffered or paid, directly or
indirectly, as a result of any and all claims, demands, suits, causes of action,
proceedings, judgments and liabilities, including reasonable counsel fees and
other expenses incurred in litigation or otherwise, assessed, incurred or
sustained (collectively "Xxxxxx Loss") by or against any of them with respect to
or arising out of (i) the failure of any representation or warranty made by
LaserSight in this Agreement or in any Schedule delivered pursuant hereto to be
true and correct in all material respects as of the date of this Agreement and
as of the Closing Date, (ii) claims of third parties that microkeratomes
manufactured by or for LaserSight after the Closing Date which are based on the
Patent and its related know-how infringes on the rights or properties of such
third party, and (iii) the breach by or nonperformance of LaserSight of any
covenants or agreements contained in this Agreement, provided that the
indemnification covenant contained in this Section will not require LaserSight
to indemnify in connection with consequential damages sustained by the parties
eligible for indemnification hereunder.
(c) If any action or proceeding be commenced, or if any claim, demand
or assessment be asserted, in respect of which a party indemnified hereunder
(the "Indemnified Party") proposes to hold any one or more of the indemnifying
party or parties (the "Indemnifying Party") liable under the provisions of this
Agreement, the Indemnifying Party shall have no liability therefor unless (i)
the Indemnifying Party shall receive written notice of such claim, demand or
assessment ("Claims Notice") within 30 days after the Indemnified Party acquires
knowledge thereof, and (ii) the Indemnifying Party shall have received copies of
all information and documents relating thereto within twenty (20) days after the
Indemnified Party's receipt thereof. If any one or more of the Indemnifying
Party or Parties shall, at its or his option, elect to contest or defend any
such action, proceeding, claim, demand or assessment, such Indemnifying Party
shall be entitled, at its or his sole cost and expense, to contest or defend the
same with counsel of their own choosing, and the Indemnified Party and its or
his respective successors or assigns shall not admit any liability with respect
thereto or settle, compromise, pay or discharge the same without the prior
written consent of the Indemnifying Party so long as any Indemnifying Party is
contesting or defending the same in good faith, and the Indemnified Party (and
their respective successors and assigns) shall cooperate with the Indemnifying
Party in the contest or defense thereof and shall accept any settlement thereof
recommended by a majority in interest of the Indemnifying Party so long as the
amount of such settlement is paid by the Indemnifying Party. If the Indemnified
Party fails to notify the Indemnifying Party of a claim in accordance with the
terms of this Section 9.1(c), and the Indemnifying Party is thereby prejudiced
by such failure of notice in its defense of the claim, the Indemnifying Party's
obligation to indemnify hereunder shall be extinguished with respect to such
claim to the extent that the Indemnifying Party has been prejudiced by the
failure to give such notice.
(d) LaserSight shall not be entitled to indemnification for any claim
until the aggregate amount of claims against Xxxxxx hereunder exceeds $10,000.00
(the "Threshold Amount"), and then the LaserSight may only recover the amount in
excess of the Threshold Amount. Prior to seeking indemnification hereunder the
parties must first utilize proceeds available from relevant insurance policies
of the Indemnified Party.
(e) Notwithstanding anything to the contrary contained in this
Agreement, Xxxxxx shall not be liable under the indemnification provisions of
this Section hereof or otherwise have any liability for any misrepresentation or
breach of warranty or covenant under this Agreement or otherwise have any
liability in connection with the transactions contemplated by this Agreement to
the extent that:
(i) the existence of such liability, the breach of warranty or
covenant or the falsity of the representation upon which such
liability would be based is disclosed in any of the contracts and
documents referred to in this Agreement, in the Schedules attached
hereto or in any other contracts, documents, records or other
instruments made available to LaserSight hereunder or which is
disclosed in a written notice furnished to LaserSight prior to the
Closing; provided, however, that any such misrepresentation or breach
of warranty or covenant so disclosed to LaserSight after the execution
and delivery of this Agreement and prior to the Closing shall not
affect the right of LaserSight to elect not to close the transactions
contemplated by this Agreement as provided in Section 8 hereof (it
being understood and agreed that if, despite such right of LaserSight
to elect not to close by reason of the misrepresentation or breach so
disclosed, LaserSight nevertheless elect to close, thereby waiving
such misrepresentation or breach, LaserSight shall thereafter have no
claim against Xxxxxx by reason of any such disclosed misrepresentation
or breach of warranty or covenant); or
(ii) such liability is based upon a claim, assessment or
deficiency for federal, state and/or local income or franchise taxes
which arise from adjustments which have the effect only of shifting
income, credits and/or deductions from one fiscal period to another;
or
(iii) such liability is offset by a credit in accordance with the
provisions of subsection 9.1(j) below.
(f) Notwithstanding anything to the contrary contained in this
Agreement, LaserSight shall not be liable under the indemnification provisions
of this Section hereof or otherwise have any liability for any misrepresentation
or breach of warranty or covenant under this Agreement or otherwise have any
liability in connection with the transactions contemplated by this Agreement to
the extent that the existence of such liability, the breach of warranty or
covenant or the falsity of the representation upon which such liability would be
based is disclosed in this Agreement, in the Schedules attached hereto, in the
SEC Filings, or which is disclosed in a written notice furnished to Xxxxxx prior
to the Closing; provided, however, that any such misrepresentation or breach of
warranty or covenant so disclosed to Xxxxxx after the execution and delivery of
this Agreement and prior to the Closing shall not affect the right of Xxxxxx to
elect not to close the transactions contemplated by this Agreement as provided
in Section 8 hereof (it being understood and agreed that if, despite such right
of Xxxxxx to elect not to close by reason of the misrepresentation or breach so
disclosed, Xxxxxx nevertheless elects to close, thereby waiving such
misrepresentation or breach, Xxxxxx shall thereafter have no claim against
LaserSight by reason of any such disclosed misrepresentation or breach of
warranty or covenant).
(g) All representations and warranties contained in Section 5, and the
indemnities set forth in Sections 9.1(a)(i) and (iii) (except for indemnities
pursuant to Section 9.1(a)(iii) which relate to Sections 7.1, 7.2, 7.3, 7.4,
7.6, 7.8(f) and 7.8(g)) shall expire on the first anniversary of the Closing
Date, and Xxxxxx shall have no liability under the indemnification provisions of
Section 9 with respect to such Sections or, except pursuant to Section 9.1(n),
otherwise have any liability under this Agreement or otherwise in connection
with the transactions contemplated by this Agreement unless (i) with respect to
other than third party claims, LaserSight gives written notice to Xxxxxx of its
claim for any such liability, setting forth in reasonable detail the specific
facts and circumstances pertaining thereto, on or before the date which is 12
months after the Closing Date, and (ii) with respect to other than third party
claims, if Xxxxxx does not satisfy such claim within 30 days after the giving of
such notice, LaserSight commences a legal action or proceeding against Xxxxxx
with respect to such claim within 45 days after the giving of such notice. With
respect to third party claims for which a Claims Notice has been sent, no
indemnification or other liability shall be due or owing under Section 9 with
respect to any LaserSight Loss to the extent it (i) is a potential claim or
cause of action which LaserSight believes may be asserted rather than a
LaserSight Loss, claim, cause of action liability which has, in fact, been
asserted, or (ii) is a LaserSight Loss, claim cause of action or liability with
respect to which LaserSight has taken action to accelerate the time period in
which such matter is asserted, wherein a material purpose of such action was to
facilitate a claim prior to the expiration of the survival period set forth in
this subsection (g) of Section 9 so that LaserSight could make an
indemnification claim prior to the expiration of such period.
(h) All representations and warranties contained in Sections 6.1 and
6.2 shall expire on the first anniversary of the Closing Date, and the
indemnities set forth in Section 9.1(b)(i) hereof and all representations and
warranties contained in Sections 6.3, 6.4, 6.5, 6.6 and 6.7 shall expire on the
fourth anniversary of the Closing Date, and after such dates LaserSight shall
have no liability under the indemnification provisions of Section 9 hereof with
respect to such Sections or, except pursuant to Section 9.1(m), otherwise have
any liability under this Agreement or otherwise in connection with the
transactions contemplated by this Agreement unless (i) with respect to other
than third party claims, Xxxxxx give written notice to LaserSight of Xxxxxx'x
claim for any such liability, setting forth in reasonable detail the specific
facts and circumstances pertaining thereto, on or before the first anniversary
of the Closing Date or the fourth anniversary of the Closing Date, as
applicable, and (ii) with respect to other than third party claims, if Xxxxxx
does not satisfy such claim within 30 days after the giving of such notice,
Xxxxxx commences a legal action or proceeding against LaserSight with respect to
such claim within 45 days after the giving of such notice. With respect to third
party claims for which a Claims Notice has been sent, no indemnification or
other liability shall be due or owing under Section 9 with respect to any Xxxxxx
Loss to the extent it (i) is a potential claim or cause of action which Xxxxxx
believes may be asserted rather than a Xxxxxx Loss, claim, cause of action
liability which has, in fact, been asserted, or (ii) is a Xxxxxx Loss, claim
cause of action or liability with respect to which Xxxxxx has taken action to
accelerate the time period in which such matter is asserted, wherein a material
purpose of such action was to facilitate a claim prior to the expiration of the
survival period set forth in this subsection (h) of Section 9 so that Xxxxxx
could make an indemnification claim prior to the expiration of such period.
(i) It is specifically understood and agreed that, except as provided
in the last sentence of Section 9.1(k), in the event a misrepresentation or
breach of warranty, covenant or agreement is discovered by a party hereto after
the Closing, the remedy of such party shall be limited to indemnification as set
forth in Section 9 hereof (as limited by the provisions set forth therein or
elsewhere in this Agreement), which shall be such party's sole and exclusive
remedy, and such party shall not be entitled to a rescission of this Agreement.
(j) In the event that, notwithstanding the limitations contained in
this Section 9 or elsewhere in this Agreement, Xxxxxx becomes liable to
LaserSight under the provisions of this Agreement or otherwise, Xxxxxx shall be
entitled to a credit or offset against any such liability of an amount equal to
the value of any net tax benefit realized (by reason of a tax deduction, basis
reduction, shifting of income, credits and/or deductions or otherwise) by
LaserSight in connection with the loss or damage suffered by LaserSight which
forms the basis of Xxxxxx'x liability hereunder. Such net tax benefit shall be
calculated by LaserSight's independent certified public accountant utilizing, to
the extent possible, generally accepted accounting principles.
(k) Notwithstanding anything to the contrary contained in this
Agreement, in the event that, notwithstanding the limitations contained in this
Section 9 or elsewhere in this Agreement, Xxxxxx become liable to LaserSight
pursuant to this Section 9 as a result of a misrepresentation or breach of a
warranty, in no event shall the aggregate amount of such liability of Xxxxxx
(including all costs, expenses and attorneys' fees paid or incurred by Xxxxxx in
connection therewith or the curing of any and all misrepresentations or breaches
of warranties under this Agreement) exceed the number which results from
multiplying 66% times the total dollar amount received by Xxxxxx pursuant to
this Agreement. The total dollar amount received by Xxxxxx pursuant to this
Agreement shall be the sum of (i) all amounts paid to Xxxxxx in immediately
available funds, and (ii) the dollar amount utilized to calculate the number of
shares of LaserSight Common Stock actually issued pursuant to this Agreement.
Nothing contained herein shall limit LaserSight's rights and remedies associated
with a breach or nonperformance by Xxxxxx of an agreement or covenant contained
in Sections 7.1, 7.2, 7.3, 7.4, 7.6, 7.8(f), 7.8(g) and indemnities pursuant to
Section 9.1(a)(iii) which relate to Sections 7.1, 7.2, 7.3, 7.4, 7.6, 7.8(f),
7.8(g).
(l) Notwithstanding anything to the contrary contained in Section 7 or
elsewhere in this Agreement, LaserSight shall not, except as otherwise expressly
provided in subsection (e)(i) of this Section 9, have the right to elect not to
close the transactions contemplated by this Agreement by reason of any
misrepresentation or breach of warranty or covenant contained in this Agreement
or otherwise if (i) Xxxxxx shall have no liability therefor to LaserSight by
reason of the provisions contained in this Section 9 or elsewhere in this
Agreement, or (ii) Xxxxxx undertakes, at his sole cost and expense (but subject
to the limitations and other provisions contained in this Section 9 or elsewhere
in this Agreement), to promptly cure such misrepresentation or breach (and/or
defend, settle, compromise and/or discharge any third party claim which forms
the basis thereof) prior to the Closing. The Threshold Amount shall not be
considered when determining whether Xxxxxx has liability pursuant to subsection
(i) of this Section 9.1(l) and determining the limitations on liability referred
to in subsection (ii) of this Section 9.1(l).
(m) Notwithstanding anything to the contrary contained in this
Agreement LaserSight's obligations pursuant to Sections 9.1(b)(ii)-(iii) shall
survive the termination of this Agreement.
(n) Notwithstanding anything to the contrary contained in this
Agreement Xxxxxx'x indemnification obligations pursuant to Section 9.1(a)(iii)
which relate to Sections 7.1, 7.2, 7.3, 7.4, 7.6, 7.8(f), 7.8(g) shall survive
the termination of this Agreement.
(o) The parties agree that there will be no ability to offset amounts
owed to a party pursuant to this Section 8 against amounts such party is
required to pay pursuant to the terms of this Agreement, the Merger Agreement or
the Consulting Agreement (as defined in the Merger Agreement).
SECTION 10. GENERAL PROVISIONS.
10.1 Survival of Provisions. The respective representations,
warranties, covenants and agreements of each of the parties to this Agreement
(except covenants and agreements which are expressly required to be performed
and are performed in full on or prior to the Closing Date) shall survive the
Closing Date and the consummation of the transactions contemplated by this
Agreement, provided that the representations and warranties contained herein
shall only survive until such time as described in Sections 9.1(g) and 9.1(h),
as applicable.
10.2 Publicity. So long as this Agreement shall be in effect, neither
Xxxxxx nor LaserSight shall issue or cause the publication of any press release
or other announcement with respect to this Agreement or the transactions
contemplated hereby without the consent of the other party, which consent shall
not be withheld where such release or announcement is required by applicable
law.
10.3 Successors and Assigns. This Agreement shall inure to the benefit
of, and be binding upon, the parties hereto and their respective successors and
assigns; provided, however, that neither party shall assign or delegate this
Agreement or any of the rights or obligations created hereunder without the
prior written consent of the other party. Notwithstanding the foregoing,
LaserSight shall have the unrestricted right to assign this Agreement and all or
any part of its rights hereunder and to delegate all or any part of its
obligations hereunder to any affiliate of LaserSight, but in such event
LaserSight shall remain fully liable for the performance of all of such
obligations in the manner prescribed in this Agreement. Nothing in this
Agreement shall confer upon any person, firm or corporation not a party to this
Agreement, or the legal representatives of such person, firm or corporation, any
rights or remedies of any nature or kind whatsoever under or by reason of this
Agreement.
10.4 Brokers and Finders. Each of parties represents and warrants to
the other that he or it has not engaged any broker, finder or investment banker
in connection with the transactions contemplated by this Agreement. Each of
LaserSight and Xxxxxx agrees to indemnify and hold harmless the other against
any brokerage fee, commission, finder's fee, or financial advisory fee due to
any person, firm or corporation acting on his or its behalf in connection with
the transactions contemplated by this Agreement.
10.5 Expenses. Except as otherwise expressly provided in this
Agreement, all legal and other fees, costs and expenses incurred in connection
with this Agreement and the transactions contemplated hereby shall be paid by
the party incurring such fees, costs or expenses.
10.6 Notices. Any notice required or permitted hereunder shall be
given in writing and shall be effective for all purposes if hand delivered to
the party designated below, sent via overnight delivery utilizing a nationally
recognized overnight delivery service or placed in the United States mail,
postage prepaid, addressed to the addresses set forth below, or to such other
address and persons as shall be designated from time to time by any party hereto
in a written notice to the other in the manner provided for in this paragraph.
The notice shall be deemed to have been given upon deposit in the United States
mail, postage prepaid, or at the time of delivery if hand delivered. A party
receiving notice which does not comply with the technical requirements for
notice under this paragraph may elect to waive any deficiencies and treat the
notice as having been properly given.
1. if to Xxxxxx, to:
Photomed, Inc.
000 Xxxx Xxxxxxxxx
Xxxx xx Xxxxxxx, Xxxxxxxxxxxx 00000
Attn: Xxxxxxxx X. Xxxxxx, M.D.
with a copy to:
Blank Rome Xxxxxxx & XxXxxxxx
Four Xxxx Xxxxxx Xxxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000
Attn: Xxxxxx Xxxxx, Esq.
or, from and after
September 1, 1997:
Blank Rome Comisky & XxXxxxxx
Xxx Xxxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000
Attn: Xxxxxx Xxxxx, Esq.
2. if to LaserSight, to:
LaserSight Incorporated
00000 Xxxxxxxx Xxxx
Xx. Xxxxx, Xxxxxxxx 00000
Attn: Chief Executive Officer
with a copy to:
Xxxxxxxxxxxx Xxxx & Xxxxxxxxx
Xxx Xxxxxxxxxxxx Xxxxxx
Xxxxx 0000
Xx. Xxxxx, Xxxxxxxx 00000
Attn: Xxxx Xxxxxxxxx, Esq.
10.7 Entire Agreement. This Agreement, together with the exhibits
hereto, represents the entire agreement and understanding of the parties with
reference to the transactions set forth herein and no representations or
warranties have been made in connection with this Agreement other than those
expressly set forth herein or in the exhibits, certificates and other documents
delivered in accordance herewith. This Agreement supersedes all prior
negotiations, discussions, correspondence, communications, understandings and
agreements between the parties relating to the subject matter of this Agreement
and all prior drafts of this Agreement, all of which are merged into this
Agreement.
10.8 Waivers and Amendments. Each of LaserSight and Xxxxxx may by
written notice to the other (a) extend the time for the performance of any of
the obligations or other actions of the other; (b) waive any inaccuracies in the
representations or warranties of the other contained in this Agreement; (c)
waive compliance with any of the covenants of the other contained in this
Agreement; (d) waive performance of any of the obligations of the other created
under this Agreement; or (e) waive fulfillment of any of the conditions to his
own obligations under this Agreement. The waiver by any party hereto of a breach
of any provision of this Agreement shall not operate or be construed as a waiver
of any subsequent breach. This Agreement may be amended, modified or
supplemented only by a written instrument executed by the parties hereto.
10.9 Severability. This Agreement shall be deemed severable, and the
invalidity or unenforceability of any term or provision hereof shall not affect
the validity or enforceability of this Agreement or of any other term or
provision hereof.
10.10 Article and Section Headings. The Article and Section headings
contained in this Agreement are solely for convenience of reference and shall
not affect the meaning or interpretation of this Agreement or of any term or
provision hereof.
10.11 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original and all of which
together shall be considered one and the same agreement.
10.12 Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of Pennsylvania, without regard to such
state's conflict of law provisions.
10.13 LaserSight Venue. LaserSight hereby irrevocably and
unconditionally consents and submits to the jurisdiction of Pennsylvania courts
in connection with all actions, suits or proceedings filed by Xxxxxx relating
LaserSight's misrepresentation or breach of the terms of this Agreement.
LaserSight irrevocably waives any objection it may have to the venue of any such
action, suit or proceeding brought in such courts or the convenience of the
forum and LaserSight irrevocably waives the right to proceed in any other
jurisdiction in connection with such action, suit or proceeding. Final judgment
in any such action, suit or proceeding shall be conclusive and may be enforced
in other jurisdictions by suit on the judgment, a certified or true copy of
which shall be conclusive evidence of the fact and the amount of any
indebtedness or liability of LaserSight therein described. LaserSight agrees
that services of process in any action or proceeding hereunder may be made upon
LaserSight by certified mail, return receipt requested to the address for notice
set forth in Section 10.6.
10.14 Xxxxxx Venue. Xxxxxx hereby irrevocably and unconditionally
consents and submits to the jurisdiction of a court chosen by LaserSight from
time to time which has legal jurisdiction as a matter of law, without reference
to this Section 10.14, over any actions, suits or proceedings filed by
LaserSight relating to any of Xxxxxx'x misrepresentation or breach of the terms
of this Agreement, provided that in no event will Xxxxxx be required to consent
to the jurisdiction of a court which as a matter of law has legal jurisdiction
other than the courts of Delaware, Missouri or Pennsylvania, provided further
that if it is determined that none of the courts of Delaware, Missouri or
Pennsylvania has jurisdiction, Xxxxxx will consent to the jurisdiction of the
courts of the state in which he then resides. Xxxxxx irrevocably waives any
objection he may have to the venue of any such action, suit or proceeding
brought in such courts or the convenience of the forum and Xxxxxx irrevocably
waives the right to proceed in any other jurisdiction in connection with such
action, suit or proceeding if venue exists as a matter of law or as a result of
Xxxxxx being domiciled in such jurisdiction. Final judgment in any such action,
suit or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment, a certified or true copy of which shall
be conclusive evidence of the fact and the amount of any indebtedness or
liability of Xxxxxx therein described. Xxxxxx agrees that services of process in
any action or proceeding hereunder may be made upon Xxxxxx by certified mail,
return receipt requested to the address for notice set forth in Section 10.6.
IN WITNESS WHEREOF, the parties hereto have duly executed this Patent
Purchase Agreement as of the date and year first above written.
Xxxxxx: LaserSight:
LASERSIGHT INCORPORATED
/s/ Xxxxxxxx X. Xxxxxx By: /s/ Xxxxxxx X. Xxxxxx
------------------------ -----------------------------
Xxxxxxxx X. Xxxxxx, M.D. Xxxxxxx X. Xxxxxx
President/Chief Executive Officer
