EXHIBIT 99-1
SECOND AMENDMENT TO AGREEMENT
FOR PURCHASE AND SALE OF STOCK
This Second Amendment to Agreement for Purchase and Sale of Stock dated as
of March 14, 1997 (the "Second Amendment") is entered into among LaserSight
Incorporated, a Delaware corporation (the "Buyer"), LaserSight Centers
Incorporated, a Delaware corporation (the "Corporation"), and the undersigned
individuals and entities named on the signature pages hereof (collectively,
"Sellers").
RECITALS
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A. Buyer, the Corporation and the Sellers entered into a certain agreement
for Purchase and Sale of Stock dated December 3, 1992 which was amended and
restated on January 15, 1993 and further amended by an Amendment to Agreement
for Purchase and Sale of Stock as of April 5, 1993 (the "First Amendment") and
by a Lasersight Centers Incorporated Consent of Shareholders dated as of July
10, 1995 (as so amended, "Current Agreement").
B. The parties desire to amend the Current Agreement.
C. The Audit Committee of the Board of Directors of Buyer (the "LaserSight
Board") has recommended that the LaserSight Board approve the Second Amendment,
and the LaserSight Board has approved the Second Amendment.
AGREEMENTS
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The parties agree as follows:
1. Paragraph 1.2 of the Current Agreement is hereby deleted and the
following substituted therefore:
1.2 As full payment for the transfer of the Shares by Sellers to
Buyer, Buyer shall deliver to Sellers unregistered shares of Buyer's
common stock, par value $.001 ("LSI Stock"), pursuant to the following
terms and conditions:
(a) 500,000 shares of LSI Stock were issued on the Closing Date,
divided proportionately among Sellers as set forth on Exhibit A to
the First Amendment, the previous receipt of which shares is
acknowledged by the Sellers; and
(b) Up to 1,225,000 additional shares of LSI Stock (collectively,
the "Earnout Shares") shall be issuable as follows:
(i) Within 30 days after the date of the Second Amendment,
625,000 Earnout Shares (the "Initial Earn-Out Shares") to be
issued and allocated among the Sellers as set forth under the
column captioned "Number of Initial Earn-Out Shares" on Exhibit
A to the Second Amendment; and
(ii) Up to an additional 600,000 Earnout Shares (the
"Contingent Earn-Out Shares") to be issued according to the
following formula as calculated for each fiscal quarter
commencing after the date of the Second Amendment, but before
the fifth anniversary of the Second Amendment):
===================================================================
PRK Earnings (as defined in Paragraph = Number of
1.2(c)) for such fiscal quarter Contingent
$4.00 Earn-Out Shares
===================================================================
The Contingent Earn-Out Shares shall be allocated among the
Sellers according to the percentages set forth under the column
captioned "Percentage of LCI Shares" on Exhibit A to the Second
Amendment. Sellers shall in no event be entitled to any Contin-
gent Earnout Shares in respect of any fiscal quarter commencing
after the fifth anniversary of the Second Amendment.
(c) For purposes hereof, "PRK Earnings" in respect of a fiscal
quarter means PRK Revenues (as defined below) for such fiscal
quarter minus PRK Expenses (as defined below) for such fiscal
quarter.
For purposes hereof, "PRK Revenues" means the sum of:
(i) all per procedure revenues received by Buyer or a
Subsidiary (as defined below) in connection with the utilization
of a fixed or mobile excimer laser to perform photorefractive
keratectomy ("PRK") and treat myopia, astigmatism and hyperopia;
provided that such excimer laser is owned or operated by Buyer
or a Subsidiary,
(ii) revenues received by Buyer or a Subsidiary from managed
care companies or employers which are specifically designated in
the contract with Buyer or such Subsidiary (as applicable) as
being in exchange for arranging for the delivery of PRK, and
(iii) any license fee, royalty or similar payment received
by Buyer or the Corporation that is exclusively on account of
patents which have been assigned to the Corporation pursuant to
the Current Agreement.
PRK Revenues shall not include any revenues received by Buyer or a
Subsidiary from:
(i) the manufacture, sale or servicing of excimer lasers,
(ii) any license fee, royalty or similar payment received by
Buyer that relate in whole or in part to patents, trade secrets,
know-how or other similar intellectual property which has not
been assigned to the Corporation pursuant to the Current
Agreement,
(iii) managed care companies or employers in exchange for
Buyer or a Subsidiary arranging for the delivery of eye care
services other than PRK or for eye care services which include
PRK without any identifiable fee attributable thereto, and
(iv) laser procedures which do not involve the use of an
excimer laser (e.g., follow-up treatment related to the removal
of cataracts, iridotomy, treatment of glaucoma, etc.).
For purposes hereof, "PRK Expenses" means all expenses incurred
by Buyer in connection with PRK Revenue, including without limitation
fees paid to optometrists and ophthalmologists, per procedure royalty
fees paid to third parties, and other operating expenses directly
attributable to the performance of PRK procedures, including without
limitation costs of personnel and other direct operating costs, but
excluding depreciation or amortization expense, any cost properly
capitalizable under generally accepted accounting principles (GAAP),
and general corporate, management, selling, marketing and
administrative expenses which are not directly related to the
performance of PRK procedures, provided that such expenses shall
include amortization expenses related to (i) any patent transferred to
Corporation by any of the Sellers, or (ii) patents which relate to PRK
and are purchased and held by, or transferred to, the Corporation.
For purposes hereof, "Subsidiary" means a corporation,
partnership or limited liability company of which Buyer or its other
Subsidiaries own, directly or indirectly, more than 80% of the shares,
or ownership interests, as applicable, necessary to elect the board of
directors or other governing body, as applicable, of such corporation,
partnership or limited liability company.
(d) PRK Earnings shall be calculated by Buyer within 60 days
after the end of each fiscal quarter commencing after the date of the
Second Amendment. Certificates for any Contingent Earn-Out Shares
issuable in respect of such fiscal quarter shall be mailed to Sellers
within 90 days after the end of such fiscal quarter.
(e) No fractional Earnout Shares will be issued; each Seller who
would otherwise be entitled to a fractional Earnout Share shall
receive in lieu thereof an amount of cash (rounded to the nearest
whole cent), without interest, equal to such fractional Earnout Share
multiplied by the closing price of LSI Stock as of the date of the
Second Amendment as reported by the NASDAQ Stock Market or such other
securities exchange or national market system on which LSI Stock is
then listed.
2. Paragraph 1.3 of the Current Agreement is hereby deleted and the
following is substituted therefore:
1.3 (a) If during the period commencing on the date of the Second
Amendment and concluding on the date on which all Sellers are able to
resell Contingent Earn-Out Shares without registration and without the
satisfaction of any limitation or condition Buyer proposes or is
required to file with the Securities and Exchange Commission ("SEC") a
registration statement under the Securities Act relating to any shares
of LSI 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 Contingent Earn-Out Shares)
(the "Registration Statement"), Buyer will each such time give prompt
written notice of its intention to do so to all Sellers. Upon the
written request of any such Sellers (collectively, "Requesting
Holders") given within 10 days after the delivery or mailing of such
notice from Buyer, Buyer will use commercially reasonable efforts to
cause the Contingent Earn-Out Shares then outstanding which such
Requesting Holders shall have requested to be included (subject to the
limitations set forth in Sections 1.3(b) and 1.3(c) below) in such
Registration Statement (the "Requested Shares") so as to permit the
public sale or other disposition of such Requested Shares, provided
that if the total number of Requested Shares exceeds 10% of the total
number of shares to be registered pursuant to the Registration
Statement, then the number of Requested Shares to be included for the
account of each Requesting Holder may at Buyer's option be reduced on
a pro rata basis in accordance with the number of Contingent Earn-Out
Shares then held by such Requesting Holder.
(b) If the Registration Statement of which Buyer gives notice
relates to an underwritten public offering, Buyer shall so advise the
holders as a part of the written notice given pursuant to Section
1.3(a) above. In such event, the right of any Requesting Holder to
registration shall be conditioned upon such Requesting Holder's
execution of the underwriting agreement agreed to among Buyer and the
managing underwriters selected by Buyer for such underwritten
offering.
(c) Notwithstanding any other provisions of this Section 1.3, if
the managing underwriter or underwriters advise Buyer that marketing
factors require a limit on the number of shares to be underwritten,
Buyer 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 Registration Statement and underwriting. In such
event, Buyer shall so advise all Requesting Holders, and the number of
Requested Shares and other shares ("Other Shares") requested to be
included in such Registration Statement and underwriting by other
persons or entities that are then stockholders of Buyer ("Other
Holders"), after providing for all shares that Buyer proposes to offer
and sell for its own account, shall be allocated among Requesting
Holders and Other Holders pro rata on the basis of (i) the number of
Requested Shares then held by such Requesting Holders and (ii) the
aggregate number of Other Shares then held by Other Holders. If any
Requested Shares or Other Shares are excluded or withdrawn from such
Registration Statement and underwriting for any reason other than
pursuant to the previous sentence, then Buyer shall offer to
Requesting Holders and Other Holders the right to include additional
Requested Shares or Other Shares, as applicable, in the Registration
Statement and underwriting in an amount equal to the number of shares
so excluded or withdrawn, with such additional shares to be allocated
among Requesting Holders and Other Holders requesting additional
inclusion, on the same basis as in the preceding sentence.
(d) In the case of each Registration Statement effected by Buyer
pursuant to this Paragraph 1.3, Buyer will advise each Requesting
Holder in writing as to the initial filing of each Registration
Statement and as to the effectiveness thereof. Buyer will use
reasonable efforts to: (i) furnish such number of prospectuses and
other documents incident thereto, including any amendment of or
supplement to the prospectus, as a Requesting Holder from time to time
may reasonably request; and (ii) cause all such Requested Shares that
are registered under a Registration Statement to be listed on each
securities exchange or national market system on which Buyer's common
stock is then listed.
(e) Each Seller shall from time to time promptly supply to Buyer
in writing any information relating to such Seller, his holdings of
LSI Stock, and his intended plan of distribution as Buyer may
reasonably request in order for it to comply with the rules of the SEC
relating to such registration statement.
(f) All expenses incurred in connection with the registration
effected pursuant to this Section 1.3, including without limitation
all registration, filing, and qualification fees (including blue sky
fees and expenses), printing expenses, escrow fees, fees and
disbursements of counsel for Buyer, expenses of special audits
incidental to or required by such registration shall be the
responsibility of Buyer and any other stockholders of Buyer
registering shares at the same time, if applicable, provided that the
Sellers shall be responsible for (i) all discounts and brokers' and
underwriters' fees and commissions associated with Requested Shares,
and (ii) all expenses of the Sellers' counsel.
3. Paragraph 1.4(a) of the Current Agreement is hereby deleted and the
following is substituted therefore:
1.4(a) [Intentionally left blank.]
4. Paragraphs 3.7(a), 3.7(b), 3.7(c), 3.7(f) and 8.4 of the Current
Agreement are hereby deleted.
5. Paragraph 9.5 of the Current Agreement is hereby deleted.
6. It is a condition precedent to Buyer's obligations under the Second
Amendment and the Current Agreement that:
(a) Each Seller shall have completed, dated and executed a
Seller's Certificate in the form attached to the Second Amendment as
Exhibit B and each Seller who is not an "accredited investor" (as
defined in Regulation D of the SEC) shall have established to the
satisfaction of the Buyer that such Seller, either alone or with such
Seller's "purchaser representative" (as defined in such Regulation D),
has such knowledge and experience in financial and business matters as
to be capable of evaluating the merits and risks of an investment in
the Earnout Shares.
(b) Buyer shall have entered into:
(i) a settlement agreement, in form and of substance which
is satisfactory to Buyer, determined in Buyer's sole discretion,
related to the action known as Public Company Publishing, Inc.
v. LaserSight Incorporated, Case Number 96-546-CV-ORL-19 pending
in the United States District, Middle District of Florida,
Orlando Division, and
(ii) an Amendment to Royalty Agreement among the
Corporation, Buyer and Laser Partners, a Florida general
partnership, which amends the Royalty Agreement dated January
15, 1993 between the Corporation and such partnership.
7. The Sellers shall cause to be delivered to Xxxxxx X. Xxxxxx, c/x Xxxxxx
& Xxxxx, P.A., 0000 Xxxxxxxx Xxxx., Xxxxx 000, Xxxxxxxx, Xxxxxxx, in person or
by registered mail, return receipt requested, on or before March 1, 1997
certificates evidencing 75,000 shares of LSI Stock, duly executed for transfer
or accompanied by executed stock powers (in either case with all signatures
guaranteed by a member firm of the New York Stock Exchange).
8. Nothing contained in the Second Amendment or in the Current Agreement
shall create, or imply that any of Buyer or any Subsidiary has, any duty or
obligation to perform or arrange for the performance of PRK by a fixed or mobile
excimer laser (the "Business"). The LaserSight Board may in its discretion
discontinue, sell or transfer the Business at any time.
9. If any term of the Second Amendment conflicts with one or more terms of
the Current Agreement, the term of the Second Amendment shall prevail. Except as
amended hereby, the Current Agreement remains in full force and effect.
10. No amendment or waiver of any provision of the Second Amendment shall
be effective against a party hereto unless the same shall be in writing and
signed by such party.
11. All notices, requests, demands and other communications hereunder shall
be in writing and shall be delivered in person or sent by registered or
certified mail, postage prepaid or by facsimile to the following addresses for
the Sellers and the Buyer:
If to the Sellers: Xxxxxxx X. X'Xxxxxxx, Xx., M.D.
0000 Xxxxx Xxxxxxxx
Xx. Xxxxx, Xxxxxxxx 00000
with a copy to: Xxxxxx Xxxxx
Star Tobacco Co.
00 Xxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Telecopy No.: (000) 000-0000
If to Buyer: LaserSight Incorporated
00000 Xxxxxxxx Xxxx
Xx. Xxxxx, Xxxxxxxx 00000
Attention: Chief Executive Officer
Telecopy No.: (000) 000-0000
with a copy to: Xxxxxxxxxxxx Xxxx & Xxxxxxxxx
Xxx Xxxxxxxxxxxx Xxxxxx
Xxxxx 0000
Xx. Xxxxx, Xxxxxxxx 00000
Attention: Xxxx X. Xxxxxxxxx
Telecopy No.: (000) 000-0000
Any party may change its address for receiving notice by written notice given to
the others named above.
12. Each party to the Second Amendment shall pay its own expenses in
connection with the transactions contemplated hereby. If any action is brought
by any party to enforce any provision of the Second Amendment or the Current
Agreement, the prevailing party shall be entitled to recover court costs,
arbitration expenses and reasonable attorneys fees.
13. The Second Amendment may be executed simultaneously in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one in the same document.
14. The Second Amendment shall bind and inure to the benefit of the parties
hereto and their respective successors and assigns, except as may otherwise be
provided in the Seller's Certificate.
15. The Second Amendment and the documents referred to herein contain the
entire understanding among the parties with respect to the transactions
contemplated hereby and supersedes all other agreements, understandings and
undertakings among the parties on the subject matter hereof.
16. The Second Amendment and the Current Agreement shall be governed by and
construed in accordance with the internal substantive laws of the State of
Missouri and the parties hereby irrevocably and unconditionally consent and
submit to the jurisdiction of Missouri courts over all matters relating to the
Current Agreement and the Second Amendment. Each party agrees that service of
process and any action or proceeding hereunder may be made upon such party by
certified mail, return receipt requested to the address for notice set forth
herein. Each party irrevocably waives any objection it may have to the venue of
any action, suit or proceeding brought in such courts or to the convenience of
the form and each party irrevocably waives the right to proceed in any other
jurisdiction. Final judgment in any such action, suit or other 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 that the amount of any indebtedness or liability of any party therein
described.
17. The Second Amendment and the Current Agreement shall be deemed
severable, and the invalidity or unenforceability of any term or provision
hereof shall not affect the validity or enforceability of the Second Amendment
or the Current Agreement or of any other term or provision hereof.
18. None of the Sellers shall issue or cause the publication of any press
release or other announcement with respect to the Second Amendment or the
transactions contemplated hereby without the written consent of the Buyer.
IN WITNESS WHEREOF, the parties hereto have duly executed this Amendment as
of the day and year first above written.
LASERSIGHT CENTERS LASERSIGHT INCORPORATED
INCORPORATED
/s/ Xxxxxxx X. Xxxxxx /s/ Xxxxxxx X. Xxxxxx
By: ---------------------------- By:-----------------------------------
Title: Xxxxxxx X. Xxxxxx
--------------------------- President and Chief Executive Officer
SELLERS:
/s/ Xxxxxx Xxxxxx
--------------------------------------
Xxxxxx Xxxxxx
/s/ Xxxx X. Xxxxx
--------------------------------------
Xxxx X. Xxxxx
/s/ Xxxxxx X. Xxxxxxxx
--------------------------------------
Xxxxxx X. Xxxxxxxx
/s/ Xxxxxxxx X. X'Xxxxxxx, Trustee
--------------------------------------
Xxxxxxxx X. X'Xxxxxxx, as Trustee for
Irrevocable Trust Number 7 for the
benefit of Xxxxxxx X. X'Xxxxxxx, Xx.,
M.D., and the Xxxxxxx X. X'Xxxxxxx,Xx.,
Descendant's Trust
/s/ X. X. Xxx
--------------------------------------
X. X. Xxx
/s/ Xxxx Xxxxxx
--------------------------------------
Xxxx Xxxxxx
/s/ Xxxxxxx X. Xxxxxx, Xx.
--------------------------------------
Xxxxxxx Xxxxxxx
/s/ Xxxx Xxxx
--------------------------------------
Xxxx Xxxx
/s/ Xxxxxxx X. Xxxxxxx
--------------------------------------
Xxxxxxx X. Xxxxxxx
/s/ W. Xxxxxxx Xxxxxx
--------------------------------------
W. Xxxxxxx Xxxxxx
/s/ Xxxxxx X. Xxxxxx
--------------------------------------
Xxxxxx X. Xxxxxx
/s/ Xxxxxx X. Xxxxxxx, M.D.
--------------------------------------
Xxxxxx X. Xxxxxxx, M.D.
/s/ Xxxxx X. Xxxxx
--------------------------------------
Xxxxx X. Xxxxx
/s/ Xxxxxxx X. Xxxxxxx
--------------------------------------
Xxxxxxx X. Xxxxxxx
L&R Medical Associates
/S/ Xxxxx X. Xxxxxxxxxx
By: --------------------------------
Xxxxx X. Xxxxxxxxxx
President
Title:------------------------------
EXHIBIT A-1
Centers Shares Owned Number
or Percentage of of Initial
Name Under Option LCI Shares Earn-Out Shares (1)
---- ------------ ---------- -------------------
Xxxxxx X. Xxxxxxxx.............................. 380,000 34.9747 218,591.875
Xxxxxxxx X. X'Xxxxxxx, as Trustee for Irrevocable
Trust No. 7 for the benefit of Xxxxxxx X.
X'Xxxxxxx, Xx., M.D.......................... 349,000 32.1215 200,759.375
Xxxxxx Xxxxxx................................... 137,500 12.6553 79,095.625
Xxxxxxx Xxxxxxx................................. 50,000 4.6019 28,761.875
Xxxxxxxx X. X'Xxxxxxx, as Trustee for Xxxxxxx X.
X'Xxxxxxx, Xx., Descendant's Trust........... 45,000 4.1417 25,885.625
Xxxx Xxxx....................................... 20,000 1.8408 11,505.000
X.X. Xxx........................................ 20,000 1.8408 11,505.000
Xxxxxx X. Xxxxxxx.............................. 15,000 1.3806 8,628.750
W. Xxxxxxx Xxxxxx............................... 15,000 1.3806 8,628.750
Xxxxxx X. Xxxxxx................................ 15,000 1.3806 8,628.750
Xxxx Xxxxxx..................................... 15,000 1.3806 8,628.750
Xxxx X. Xxxxx................................... 3,000 0.2761 1,725.625
Rozakis, M.D.................................... 10,000 0.9204 5,752.500
Xxxxx X. Xxxxx.................................. 7,850 0.7225 4,515.625
Xxxxxxx X. Xxxxxxx.............................. 3,100 0.2853 1,783.125
L&R Medical Associates.......................... 1,050 0.0966 603.750
----- ------ -------
TOTALS.................................. 1,086,500 100.0000 625,000.000
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(1) Fractional shares are to be paid in cash as provided in the Second Amendment.
