AGREEMENT FOR
ASSIGNMENT OF LICENSE INTERESTS AND
RELATED MATTERS
Agreement made as of November 1, 1996 by and among National Vision
Associates, Ltd., a Georgia corporation ("NVAL"), NVAL Visioncare Systems
of California, Inc., a California corporation ("NVS-C"), NVAL Visioncare
Systems of North Carolina, Inc., a North Carolina corporation ("NVS-NC"),
Eyecare Leasing, Inc., an Alabama corporation ("▇▇▇"), ▇▇▇▇▇▇▇-▇▇▇▇▇▇▇▇,
Inc., a California corporation ("SPI"), ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, O.D., an
optometrist licensed in the State of Alabama ("▇▇▇▇▇▇▇"), and ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇, O.D., an optometrist licensed in the State of Florida
("▇▇▇▇▇▇▇▇").
Recitals
A. NVAL provides vision care products and services in Wal-Mart stores
pursuant to a certain Vision Center Master License Agreement dated as of
June 16, 1994.
B. On or about November 19, 1990, NVAL and ▇▇▇ executed an agreement
with respect to certain consulting and management services ▇▇▇ was to
perform for the benefit of NVAL. This agreement was subsequently amended
by six addendums to the agreement.
C. NVAL entered into a master assignment agreement dated March 1, 1991
with SPI pursuant to which NVAL assigned to SPI certain rights of NVAL with
respect to certain optometric clinics located in California. Immediately
prior to the Closing Time (as defined below), NVAL and SPI will, subject
to the terms and conditions of this agreement, enter into a successor
master assignment agreement, which will confirm and modify the original
master assignment in various respects. Pursuant to the successor master
assignment agreement, NVAL will assign to SPI certain rights of NVAL
with respect to optometric clinics located in California and West Virginia.
D. Each of NVS-C and NVS-NC is an affiliate of NVAL.
▇. ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇ are officers and the principals of ▇▇▇ and
of SPI.
F. NVAL and ▇▇▇ wish to terminate their consulting agreement, subject
to the terms and conditions of this agreement. In connection with such
termination, NVAL wishes to purchase the goodwill and miscellaneous assets
associated with ELI's business.
G. Subject to the terms and conditions of this agreement, SPI intends
to assign to NVS-C, and NVS-C intends to receive from SPI, the interest of
SPI in the master assignment agreement, insofar as such master assignment
agreement applies to optometric clinics located in California. Subject to
the terms and conditions of this agreement, SPI intends to assign to NVS-NC,
and NVS-NC intends to receive from SPI, the interest of SPI in the master
assignment agreement, insofar as such master assignment agreement applies
to optometric clinics located in West Virginia.
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Agreement
The parties agree as follows:
1. Definitions. As used herein, the terms identified below in this
Section 1 shall have the meanings indicated.
A. The Act. The ▇▇▇▇-▇▇▇▇▇ Health Care Service Plan Act of
1975 of California.
B. Agreement. This Agreement, including all Exhibits and
Schedules listed on the Index.
C. ▇▇▇▇ of Sale. ▇▇▇▇ of sale whereby ▇▇▇ conveys the
Miscellaneous Assets to NVAL. A copy of the ▇▇▇▇ of Sale
is attached as Exhibit A.
D. California Assignment. Agreement by which SPI assigns the
California License Interest to NVS-C. A copy of the
California Assignment is attached as Exhibit B.
E. California License Interest. The right, title, and interest
of SPI under the Master Assignment Agreement with respect to
the Clinic Spaces (and accompanying Clinic Personalty) located
in California.
F. California Note. Promissory note in the amount of $2,655,000
made by NVAL in favor of SPI. A copy of the California Note
is attached as Exhibit C.
G. California Optometrist. An Optometrist whose Optometric
Sublicense covers a Clinic Space located in California.
H. Clinic Personalty. All "Clinic Personalty", as defined in
Section 4(a) of the Master Assignment Agreement.
I. Clinic Spaces. All "Clinic Spaces", as defined in the
recitals to the Master Assignment Agreement.
J. Closing. The completion of the transactions contemplated
hereby, as described in Section 7 hereof.
K. Closing Date. The later of (a) January 3, 1997 and (b) the
first day of the first month which is at least 5 days after
the date NVS-C receives notice from the Department that NVS-C
has been granted the License.
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L. Closing Time. 10:00 a.m. on the Closing Date, or the time
on the Closing Date at which the Closing actually occurs. All
events that are to occur at the Closing Time shall, for all
purposes, be deemed to occur simultaneously and to have
occurred at the close of business on the Closing Date.
M. Consulting and Management Services Agreement. Consulting and
Management Services Agreement dated as of December 18, 1990
by and between NVAL and ▇▇▇, including a First Addendum dated
as of December 18, 1990, Second Addendum dated as of March 1,
1991, Amended and Restated Second Addendum dated as of
March 1, 1991, Third Addendum dated as of January 1, 1992,
Fourth Addendum dated as of August 6, 1993, Fifth Addendum
dated as of October 1, 1993, and a Sixth Addendum dated as
of April 1, 1994. A copy of the Consulting Agreement is
attached as Exhibit D.
N. Credit Agreement. Credit agreement dated as of November 15,
1994 among NVAL, Wachovia Bank of Georgia, N.A., Trust
Company Bank, and Bank South, N.A.
O. Department. The California Department of Corporations.
P. Execution Date. November 1, 1996.
Q. Goodwill. All goodwill and know-how of and know-how ▇▇▇
associated with its business, including, without limitation,
contacts, information, files about, lists of practicing
optometrists in all states of the United States except
California and West Virginia, rights to (and all goodwill
associated with) the name "Eyecare Leasing", and any and
all Records (as defined in Section 5A6 hereof) insofar as
such Records relate to and concern ▇▇▇ and Optometrists in
states other than California and West Virginia.
R. Goodwill Assignment. Assignment by ▇▇▇ to NVAL of ELI's
interest in the Goodwill. A copy of the Assignment is
attached as Exhibit E.
S. Index. Index of Exhibits and Schedules to this Agreement,
as attached.
T. License. The license as a specialized health care service
plan for which NVS-C is applying under the Act.
U. License Interests. Collectively, the California License
Interest and the West Virginia License Interest.
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V. Master Assignment Agreement. Master Assignment Agreement by
and between NVAL and SPI dated as of June 16, 1994 and is
to be executed and delivered prior to the Closing Time
pursuant to Section 6A hereof. A copy of the Master
Assignment Agreement is attached as Exhibit F.
W. Miscellaneous Assets. The assets of ▇▇▇ listed on
Schedule 1W.
X. Noncompetition Agreements. An agreement between NVAL and
▇▇▇▇▇▇▇ and an agreement between NVAL and ▇▇▇▇▇▇▇▇ pursuant
to which each of ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇ agrees not to engage
in certain activities competitive with NVAL. A copy of each
such agreement is attached as Exhibit G-1 and G-2.
Y. Noncompetition Notes. A promissory note in the principal
amount of $125,000 made by NVAL in favor of ▇▇▇▇▇▇▇ and a
promissory note in the amount of $125,000 made by NVAL in
favor of ▇▇▇▇▇▇▇▇. A copy of each such note is attached
as Exhibit H-1 and H-2.
Z. Notes. Collectively, the California Note, the Noncompetition
Notes, the Termination and Goodwill Note, and the West
Virginia Note.
AA. NVAL Group. Individually and collectively, NVAL, NVS-C, and
NVS-NC.
AB. Optometric Sublicenses. (i) Sublicenses with optometrists
executed by SPI with respect to the Clinic Spaces and (ii)
sublicenses with optometrists executed by ▇▇▇ as agent of
NVAL pursuant to the Consulting Agreement. A copy of the
standard forms of the Optometric Sublicenses is attached as
Exhibit I.
AC. Optometrist. An optometrist (or a professional corporation
controlled by such optometrist) who is a party to an
Optometric Sublicense.
AD. Person. An individual, a corporation, an association, a
partnership, a trust, a joint venture, an unincorporated
organization, or a governmental entity (or any department,
agency, or political subdivision thereof).
AE. Preclosing Payment. Payment in the amount of $100,000,
made by NVAL to ▇▇▇, in the circumstances described in and
pursuant to the provisions of Section 10 hereof.
AF. SPI Group. Individually and collectively, SPI, ELI, Stewart,
and ▇▇▇▇▇▇▇▇.
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AG. Technical Assistance Agreements. An agreement between NVAL
and ▇▇▇▇▇▇▇ and an agreement between NVAL and ▇▇▇▇▇▇▇▇ for
the performance of certain technical services. A copy of
each such agreement is attached as Exhibit J-1 and J-2.
AH. Termination Agreement. Agreement by NVAL and ▇▇▇, terminating
the Consulting Agreement. A copy of the Termination Agreement
is attached as Exhibit K.
AI. Termination and Goodwill Note. Promissory note in the
principal amount of $1,105,000 made by NVAL in favor of ▇▇▇.
A copy of the Termination Note is attached as Exhibit L.
AJ. West Virginia Assignment. Agreement by which SPI assigns
the West Virginia License Interest to NVS-NC. A copy of the
West Virginia Assignment is attached as Exhibit M.
AK. West Virginia License Interest. The right, title, and
interest of SPI under the Master Assignment Agreement with
respect to the Clinic Spaces (and accompanying Clinic
Personalty) located in West Virginia.
AL. West Virginia Note. Promissory note in the principal amount
of $90,000 made by NVAL in favor of SPI. A copy of the West
Virginia Note is attached as Exhibit N.
2. Conveyances and Actions. On the terms and conditions hereinafter
set forth, (a) SPI shall transfer and assign to NVS-C, and NVS-C shall take
and accept, the California License Interest, (b) SPI shall transfer and
assign to NVS-NC, and NVS-NC shall take and accept, the West Virginia
License Interest, (c) ▇▇▇ shall sell to NVAL, and NVAL shall purchase from
▇▇▇, the Goodwill and the Miscellaneous Assets, (d) NVAL and ▇▇▇ shall
terminate the Consulting Agreement, and (e) the other deliveries and
exchanges of documents as described in Section 7 hereof shall take place.
3. Purchase Price and Allocation.
A. Purchase Price. The purchase price for the (a) California
License Interest shall be $3,000,000, (b) West Virginia
License Interest shall be $100,000, (c) Goodwill shall be
$750,000, (d) termination of the Consulting Agreement shall
be $500,000, and (e) Miscellaneous Assets shall be $4,000,
in each case to be paid at the Closing, in the manner
described in Section 7 hereof. Each of (a),(b),(c) and (e)
shall be deemed capital assets.
B. Allocation. Each member of the NVAL Group, on the one hand,
and each member of the SPI Group, on the other hand, agrees
that the purchase price and allocation described in Section
3A hereof represents the results of their economic
negotiations and the present fair market value of each of
the assets described above.
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4. Representations and Warranties.
A. By SPI Group. Each of the SPI Group represents and warrants
(jointly and severally) to and for the benefit of each of the
NVAL Group as follows as of the Execution Date and the Closing
Date:
1. Existence and Authority. Each of SPI and ▇▇▇ is a
corporation duly organized, validly existing and in good
standing under the laws of the state of its incorporation
with corporate power to own and operate its business and
properties and to carry on its business as presently
conducted. The execution, delivery and performance
of this Agreement has been duly authorized by all
corporate action required on the part of each of SPI
and ▇▇▇, and no further corporate action will be
necessary on the part of each of SPI and ▇▇▇ to make
this Agreement valid and binding upon each of them.
2. Compliance with Laws. Each of SPI and ▇▇▇ has fully
complied with all federal, state and local laws, rules
and regulations with respect to the recruitment of
optometrists. (The parties acknowledge and agree
that this representation and warranty does not extend
to the manner in which any Optometrist conducts his or
her practice.)
3. Enforceability. This Agreement constitutes a legal,
valid and binding obligation of each of SPI and ▇▇▇,
enforceable in accordance with its terms, and will not
result in the violation of any term or provision of
the articles of incorporation or by-laws of each of
SPI and ▇▇▇ or the laws of any jurisdiction to which
either of SPI and ▇▇▇ may be subject or of any agreement,
contract or indenture to which either of SPI or ▇▇▇ is
a party or by which any of SPI, ▇▇▇ or the License
Interests may be bound or affected; nor is any consent
or approval of any Person to the consummation of the
transactions herein described necessary or required,
other than as expressly provided herein.
4. Title. SPI has good and marketable title to and is the
sole and lawful owner of the License Interests with
full right, power and authority to transfer SPI's
rights, titles and interest in and to the California
License Interest and the West Virginia License Interest
to NVS-C and NVS-NC, respectively. (The parties
acknowledge and agree that the right, title, and
interest of SPI in the Clinic Spaces and Clinic
Personalty derive solely from SPI's status as a
party to the Master Assignment Agreement.) The
License Interests are currently and will be on the
Closing Date owned by SPI free and clear of any claim,
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lien, encumbrance, security interest,judgment,
mortgage, pledge, conditional sales agreement, contract
of sale, restriction or charge of any nature whatsoever,
or any other liability or encumbrance of any kind or
character. SPI has duly filed or will file when due
all tax returns and reports with respect to taxes
imposed upon the License Interests, or taxes imposed
on SPI which might create a lien or encumbrance relating
to any period prior to the Closing Date on the License
Interests or which would be a valid and subsisting
lien thereon after transfer thereof to NVS-C and NVS-NC,
respectively, and SPI has paid or will pay when due all
of such taxes. ▇▇▇ has good and marketable title to
and is the sole and lawful owner of the Miscellaneous
Assets and the Goodwill with full right, power and
authority to transfer ELI's rights, titles and interest
in and to the Miscellaneous Assets and the Goodwill.
The Miscellaneous Assets and the Goodwill are currently
and will be on the Closing Date owned by ▇▇▇ free and
clear of any claim, lien, encumbrance, security interest,
judgment, mortgage, pledge, conditional sales agreement,
contract of sale, restriction or charge of any nature
whatsoever, or any other liability or encumbrance of
any kind or character.
5. Condition. To the best of its knowledge, all the
Miscellaneous Assets will be on the Closing Date in
good condition and repair, subject to normal wear and
tear, suited for the use intended and operated in
conformity with all applicable laws, rules, regulations
and ordinances, including without limitation all
applicable building and zoning laws, ordinances and
regulations. To the best of its knowledge, there are
no defects or conditions which would cause the
Miscellaneous Assets to be or to become inoperable or
unsafe.
6. Litigation. To the best of its knowledge, there is
no claim, action, counterclaim, suit, proceeding or
investigation pending or threatened against any member
of the SPI Group, before any court or any arbitrator
or governmental agency affecting the License Interests,
the Clinic Personalty, any Optometric Sublicenses, or
the consummation of the transactions contemplated hereby.
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7. Licenses. Each of SPI and ▇▇▇ possesses all franchises,
certificates, licenses, permits and other authorizations
from public, government, regulatory or judicial
authorities, free from restrictions not customary for
comparable businesses, that are necessary for the
ownership, maintenance and operation of (as to SPI only)
the License Interests, and each of SPI and ▇▇▇ is not in
violation thereof. There are no approvals of
governmental, regulatory or judicial bodies necessary
for the consummation of the transactions contemplated
by this Agreement, other than as expressly provided
herein. (The parties acknowledge and agree that this
representation and warranty does not extend to the manner
in which any Optometrist conducts his or her practice.)
8. Optometric Sublicenses. Each Optometric Sublicense is
valid and in full force and effect in accordance with its
terms. A true and correct copy of the standard form of
each Optometric Sublicense is attached and made part of
Exhibit I. Schedule 4A8 accurately and completely sets
forth, for each Optometric Sublicense, (i) the parties
to the Optometric Sublicense, (ii) the date of its
execution, (iii) the location of the property which is
the subject of the Optometric Sublicense, (iv) license
fees payable thereunder, (v) the standard form on which
it is based, and (vi) any terms and provisions which
differ from those contained in the standard form
for such Optometric Sublicense. There has not been any
amendment, modification, or variation of any of the
Optometric Sublicenses other than as reflected on
Schedule 4A8 and each Optometric Sublicense truly,
accurately, and completely sets forth all terms and
conditions of the entire contractual relationship
between SPI and the Optometrist and between the
Optometrist and ▇▇▇, as agent for NVAL. Except as
disclosed on Schedule 4A8, there is not under any
Optometric Sublicense any default (or any claim of
default) by any party to such Optometric Sublicense, or
any event of default or event which with notice or
lapse of time or both would constitute a default by
such party and in respect of which such party has not
taken adequate steps to prevent a default on its part
from occurring. Neither SPI nor ▇▇▇ has received (or
has notice of) any exercise (by any Person (including,
without limitation, any Optometrist)) of a right to
cancel or terminate (whether or not arising out of an
alleged default) any Optometric Sublicense. The
interest of each of SPI and ▇▇▇ in and under each
Optometric Sublicense is unencumbered and is subject
to no present claim, contest, dispute, action or
threatened action at law or in equity or otherwise.
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Each of SPI and ▇▇▇ has performed all the obligations
required to be performed by each of them under each of
the Optometric Sublicenses. SPI is lawfully in possession
of all property which is the subject of each Optometric
Sublicense. Except as disclosed in Schedule 4A8, no
options have been granted by SPI or ▇▇▇ to others to
purchase, lease or otherwise acquire any interest in
the property, or any part thereof, which is the subject
of any Optometric Sublicense. Each Optometric Sublicense
for Clinic Space can, by its terms, be assigned to NVS-C
and NVS-NC as appropriate, without the consent of any
Person and without penalty or cost or decreased license
fees payable thereunder to NVS-C or NVS-NC, as
appropriate.
9. Compliance with Agreements. Each of SPI and ▇▇▇ is
(and, at all times prior to the Execution Date, has been)
in compliance with all terms and conditions of each of
the predecessor master assignment agreement described in
Recital C hereof and the Consulting Agreement,
respectively.
10. No Contracts. Other than the Optometric Sublicenses and
except as disclosed in Schedule 4A10, each of SPI and
▇▇▇ is not a party to any contract, agreement, or
understanding whatsoever with respect to or in any way
relating to (or delegating duties or responsibilities
under) (i) the Master Assignment Agreement, (ii) the
Consulting Agreement, (iii) the Miscellaneous Assets, or
(iv) any space (including, without limitation, the
Clinic Spaces) subject to the Optometric Sublicenses.
11. Disclosure. The representations and warranties contained
in this Section 4A do not contain any untrue statement
of a fact or omit to state a fact necessary in order
to make the statements and information contained herein
not materially misleading.
12. Investment. Each of SPI and ▇▇▇ (i) understands that
the Notes have not been, and will not be, registered
under the Securities Act of 1933, as amended, or under
any state securities laws, and are being offered and
sold in reliance upon federal and state exemptions for
transactions not involving any public offering, (ii)
is acquiring the applicable Notes solely for its own
account for investment purposes, and not with a view
to the distribution thereof (except to ▇▇▇▇▇▇▇ and
▇▇▇▇▇▇▇▇, as shareholders of each of SPI and ▇▇▇), (iii)
is a sophisticated investor with knowledge and
experience in business and financial matters, (iv) has
received certain information concerning NVAL and has
had the opportunity to obtain additional information
as desired in order to evaluate the merits and the
risks inherent in holding the Notes, (v) is able to
bear the economic risk and lack of liquidity inherent
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in holding the Notes, and (vi) is an "accredited
investor" as defined in Regulation D promulgated by
the Securities and Exchange Commission.
B. By NVAL Group. Each of the NVAL Group represents and warrants
(jointly and severally) to and for the benefit of each of the SPI
Group as follows as of the Execution Date and the Closing Date:
1. Existence and Authority. Each of NVAL, NVS-C, and NVS-NC
is a corporation duly organized, validly existing and in
good standing under the laws of the state of its
incorporation with corporate power to own and operate
its business and properties and to carry on its business
as presently conducted. The execution, delivery and
performance of this Agreement has been duly authorized
by all corporate action required on the part of each of
NVAL, NVS-C, and NVS-NC, and no further corporate action
will be necessary on the part of each of NVAL, NVS-C,
and NVS-NC to make this Agreement valid and binding
upon each of them.
2. Enforceability. This Agreement constitutes a legal,
valid and binding obligation of each of NVAL, NVS-C,
and NVS-NC, enforceable in accordance with its terms,
and will not result in the violation of any term or
provision of the articles of incorporation or by-laws
of each of NVAL, NVS-C, and NVS-NC or the laws of any
jurisdiction to which NVAL, NVS-C and NVS-NC may be
subject or of any agreement, contract or indenture to
which NVAL, NVS-C, or NVS-NC is a party or by which
any of NVAL, NVS-C, or NVS-NC may be bound or affected;
nor is any consent or approval of any Person to the
consummation of the transactions herein described
necessary or required, other than as expressly provided
herein.
3. Litigation. To the best of its knowledge, there is no
claim, action, counterclaim, suit, proceeding or
investigation pending or threatened against any member
of the NVAL Group, before any court or any arbitrator
or governmental agency affecting the License Interests,
the Clinic Personalty or the consummation of the
transactions contemplated hereby.
4. Disclosure. The representations and warranties contained
in this Section 4B do not contain any untrue statement
of a fact or omit to state a fact necessary in order
to make the statements and information contained herein
not materially misleading.
5. Compliance with Credit Agreement. NVAL is in compliance
with all terms and conditions of the Credit Agreement.
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5. Conduct of Business Pending Closing.
A. SPI Group. Each member of the SPI Group covenants and
agrees that, between the Execution Date and the Closing Date:
1. Business. The business and operations of each of SPI
and ▇▇▇ shall, subject to Section 5A4 hereof, be
conducted only in the ordinary course and each of SPI
and ▇▇▇ shall use its best efforts to preserve the
goodwill of Optometrists and other Persons having
business with each of SPI and ▇▇▇.
2. Miscellaneous Assets. ▇▇▇ will maintain the
Miscellaneous Assets in the same condition as on the
Execution Date, ordinary wear and tear excepted.
3. Liens. SPI will not sell or transfer, mortgage, pledge
or subject to any lien, charge or other encumbrance any
asset included in the License Interests.
4. Sublicenses. Each of SPI and ▇▇▇ will not enter into
any (a) new optometric sublicenses or (b) amendments
to any of the Optometric Sublicenses, without the prior
written consent of a member of the NVAL Group.
5. Cooperation. Each member of the SPI Group shall fully
cooperate with NVS-C in connection with its (a)
application to obtain the License and (b) request to
the Department that the Department approve the
transaction whereby the California License Interest is
transferred by SPI to NVS-C. Such cooperation shall
include, without limitation, (a) promptly assisting
NVS-C in (i) responding to requests by the Department
for information or documentation, and (ii) obtaining
from the California Optometrists executed provider
agreements with NVS-C (in form and substance satisfactory
to NVS-C and the Department), (b) promptly executing and
delivering documents or instruments requested by NVS-C
or the Department, and (c) traveling to California,
when and as requested by NVS-C, to meet with, as
appropriate, (i) representatives of the Department,
(ii) California Optometrists, and (iii) representatives
of NVS-C. All such cooperation shall be at the cost
and expense of SPI except that, if SPI incurs out of
pocket expenses on or after November 1, 1996 in
connection with such cooperation, such expenses shall
be reimbursed by a member of the NVAL Group.
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6. Access. Each of SPI and ▇▇▇ will permit representatives
of any member of the NVAL Group to have full access to
all books, records, software, hardware, contracts, files,
and documents (all the foregoing, collectively, "Records")
and premises and personnel relating to SPI, ▇▇▇, or their
respective businesses, including, without limitation,
Records relating to the License Interests, the Optometric
Sublicenses, and any Optometrist. Neither the granting
of such access nor the information obtained from any
Records shall impair or in any way affect the
representations, warranties, and covenants made in this
Agreement by any member of the SPI Group or the rights
of any member of the NVAL Group with respect thereto,
under this Agreement or otherwise.
7. Notice of Developments. Each member of the SPI Group
will give prompt written notice to NVAL of any material
adverse development causing a breach of any of its own
representations and warranties in Section 4A hereof. No
disclosure by any party pursuant to this Section 5A7,
however, shall be deemed to prevent or cure any
misrepresentation, breach of warranty, or breach of
covenant.
8. Exclusivity. Each of SPI and ▇▇▇ will not (a) solicit,
initiate, or encourage the submission of any proposal
or offer from any Person relating to the acquisition of
any capital stock or other voting securities, or any
substantial portion of the assets, of SPI or ▇▇▇
(including any acquisition structured as a merger,
consolidation, or share exchange) or any sale or
disposition of any, all, or part of the License
Interests, or the Optometric Sublicenses, or (b)
participate in any discussions or negotiations regarding,
furnish any information with respect to, assist or
participate in, or facilitate in any other manner any
effort or attempt by any Person to do or seek any of
the foregoing. Each of SPI and ▇▇▇ will notify NVAL
immediately if any Person makes any proposal, offer,
inquiry, or contact with respect to any of the foregoing.
9. Employee. SPI and ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇ shall assist in
NVS-C's obtaining the services of ▇▇▇▇▇ ▇▇▇▇▇▇▇, O.D.,
as Director of Quality Assurance for NVS-C, on terms
satisfactory to NVS-C.
10. General. Each member of the SPI Group shall exercise
its best efforts to take all action and to do all things
necessary, proper, and advisable to consummate the
transactions contemplated herein.
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B. NVAL Group. Each member of the NVAL Group covenants and
agrees that, between the Execution Date and the Closing Date:
1. Notice of Developments. Each member of the NVAL Group
will give prompt written notice to the SPI Group of any
material adverse development causing a breach of any of
its own representations and warranties in Section 4B
hereof. No disclosure by any party pursuant to this
Section 5B1, however, shall be deemed to prevent or
cure any misrepresentation, breach of warranty, or
breach of covenant.
2. Capital Contributions. NVAL shall cause each of the
California Note and West Virginia Note to be contributed
to the capital of each of NVS-C and NVS-NC, respectively.
3. General. Each member of the NVAL Group shall exercise
its best efforts to take all action and to do all things
necessary, proper, and advisable to consummate the
transactions contemplated herein.
6. Conditions to Closing.
A. In Favor of NVAL Group. The obligation of each member of the
NVAL Group to consummate the transactions contemplated hereby
is subject to the satisfaction, at or before the Closing Time,
of the following conditions:
1. Representations and Warranties. All representations and
warranties made in Section 4A hereof shall be true on
and as of the Closing Date as though such representations
and warranties were made on and as of the Closing Date.
2. Covenants. Each member of the SPI Group shall have
performed and complied in all material respects with all
covenants and agreements and satisfied all conditions
that each such party is required by this Agreement to
perform and comply with before or at the Closing.
3. Documents. All documents and instruments required to be
delivered by each member of the SPI Group pursuant to
this Agreement prior to or at the Closing Time shall
have been delivered prior to or at such time.
4. License. NVS-C shall have obtained the License on terms
and conditions satisfactory to it.
13
5. Department. The Department shall have consented, on
terms and conditions satisfactory to NVS-C, to the
transaction whereby the California License Interest is
transferred by SPI to NVS-C.
6. Credit Agreement. The banks which are parties to the
Credit Agreement have either (a) approved this Agreement
and the transactions contemplated hereby or (b) have
executed an amendment to the Credit Agreement which,
either expressly or by implication, permits each member
of the NVAL Group to consummate the transactions
contemplated hereby without there being a breach or
default under the Credit Agreement by NVAL, in either
case on terms and conditions satisfactory to each member
of the NVAL Group.
7. Master Assignment Agreement. SPI shall have, prior to
the Closing Time, executed the Master Assignment
Agreement and delivered such agreement to NVAL.
8. Actions. All actions to be taken by each member of the
SPI Group in connection with the transactions contemplated
herein and all certificates, opinions, instruments, and
other documents required to consummate the transactions
contemplated herein will be reasonably satisfactory in
form and substance to each member of the NVAL Group.
B. In Favor of SPI Group. The obligation of each member of the
SPI Group to consummate the transactions contemplated hereby
is subject to the satisfaction, at or before the Closing Time,
of the following conditions:
1. Representations and Warranties. All representations and
warranties made in Section 4B hereof shall be true on and
as of the Closing Date as though such representations and
warranties were made on and as of the Closing Date.
2. Covenants. Each member of the NVAL Group shall have
performed and complied in all material respects with all
covenants and agreements and satisfied all conditions
that each such party is required by this Agreement to
perform and comply with before or at the Closing.
3. Documents. All documents, payments, and instruments
required to be delivered by each member of the NVAL
Group pursuant to this Agreement prior to or at the
Closing Time shall have been delivered prior to or at
such time.
14
4. Actions. All actions to be taken by each member of the
NVAL Group in connection with the transactions
contemplated herein and all certificates, opinions,
instruments, and other documents required to consummate
the transactions contemplated herein will be reasonably
satisfactory in form and substance to each member of
the SPI Group.
7. Closing.
A. Time and Place. The Closing will take place on the Closing
Date at the offices of NVAL at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇.
B. Documents and Instruments. The following items will be
delivered at the Closing Time:
1. Deliveries by SPI. SPI shall execute and deliver:
a. California Assignment. The California Assignment to
NVS-C.
b. West Virginia Assignment. The West Virginia
Assignment to NVS-NC.
2. Delivery by ▇▇▇. ▇▇▇ shall execute and deliver to NVAL
(a) the Goodwill Assignment and (b) the ▇▇▇▇ of Sale.
3. Deliveries by SPI Group. The SPI Group will deliver to
NVAL:
a. Opinion Letter. An opinion letter of Doffermyre
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇, counsel for the
SPI Group, dated as of the Closing Date, in the
form of Exhibit O.
b. Closing Certificate. A certificate substantially
in the form of Exhibit P, dated as of the Closing
Date, and signed by each of ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇, to
the effect that the representations and warranties
of the SPI Group contained in Section 4A hereof are
true and correct on and as of the Closing Date.
c. Resolutions. Certified copies of resolutions of the
Board of Directors and the shareholders of each of
SPI and ▇▇▇ authorizing the execution, delivery,
and performance (by SPI and ▇▇▇, respectively) of
this Agreement.
15
4. Delivery by NVS-C. NVS-C will deliver the executed
California Note to SPI.
5. Delivery by NVS-NC. NVS-NC will deliver the executed
West Virginia Note to SPI.
6. Deliveries by NVAL. NVAL will execute and deliver:
a. Termination and Goodwill Note. The Termination and
Goodwill Note to ▇▇▇.
b. Noncompetition Notes. A Noncompetition Note to
▇▇▇▇▇▇▇ and a Noncompetition Note to ▇▇▇▇▇▇▇▇.
c. Cash Payments. The following payments (made by
corporate check):
i. $345,000 to SPI, with respect to the California
License Interest.
ii. $10,000 to SPI, with respect to the West Virginia
License Interest.
iii. $85,000 (less one half the Preclosing Payment
(if any) which may have been made pursuant to
Section 10 hereof) to ▇▇▇, with respect to the
Goodwill.
iv. $60,000 (less one half the Preclosing Payment
(if any) which may have been made pursuant to
Section 10 hereof) to ▇▇▇, with respect to the
termination of the Consulting Agreement.
v. $4,000 for the Miscellaneous Assets.
d. Closing Certificate. A certificate substantially in
the form of Exhibit Q, dated as of the Closing Date,
and signed by an officer of NVAL, to the effect that
the representations and warranties of the NVAL Group
contained in Section 4B hereof are true and correct
on and as of the Closing Date.
7. Exchanges.
a. Termination Agreement. NVAL and ▇▇▇ will execute and
exchange the Termination Agreement.
16
b. Noncompetition Agreements. NVAL and ▇▇▇▇▇▇▇ will
execute and exchange and NVAL and ▇▇▇▇▇▇▇▇ will
execute and exchange the applicable Noncompetition
Agreement.
c. Technical Assistance Agreements. NVAL and ▇▇▇▇▇▇▇
will execute and exchange and NVAL and ▇▇▇▇▇▇▇▇ will
execute and exchange the applicable Technical
Assistance Agreement.
8. Indemnification.
A. Obligation. Each member of the SPI Group on the one hand and
of the NVAL Group on the other hand ("Indemnitor") jointly
and severally agrees to indemnify and hold harmless each member
of the other group, its affiliates, officers and directors
(hereinafter collectively, "Indemnitee") from and against and
in respect of any and all loss, damage, liability, cost
and expense, including reasonable attorney's fees and amounts
paid in settlement, suffered or incurred by any Indemnitee by
reason of or arising out of any misrepresentation, breach of
warranty or breach or nonfulfillment of any agreement of the
other party hereto contained in this Agreement or in any
certificate, schedule, instrument or document delivered
pursuant to the provisions of this Agreement. It is expressly
agreed that, subject to the provisions of Section 12N hereof,
no member of the NVAL Group, nor its successors and assigns,
shall have the right to offset its obligations under the Notes.
B. Claims. If any claim or action by a third party arises after
the Closing Date for which Indemnitor may be liable under the
terms hereof, then Indemnitee shall notify Indemnitor within
a reasonable time after such claim or action arises and is
known to Indemnitee, and shall give Indemnitor a reasonable
opportunity:
1. to conduct any proceedings or negotiations in connection
therewith and necessary or appropriate to defend
Indemnitee;
2. to take all other required steps or proceedings to settle
or defend any such claim or action; and
3. to employ counsel to contest any such claim or action
in the name of Indemnitee or otherwise.
The expenses of all proceedings, contests or lawsuits with
respect to such claims or actions shall be borne by Indemnitor.
If Indemnitor wishes to assume the defense of such claim or
action, then Indemnitor shall give written notice to
Indemnitee within 30 days after notice from Indemnitee
17
of such claim or action (unless the claim or action reasonably
requires a response in less than 30 days after the notice
is given to Indemnitor, in which event Indemnitor shall notify
Indemnitee at least 10 days prior to such reasonably required
response date), and Indemnitor shall thereafter assume the
defense of any such claim or liability, through counsel
reasonably satisfactory to Indemnitee; provided that
Indemnitee may participate in such defense at its own expense
and shall, in any event, have the right to control the
defense of the claim or action.
C. Defense. If Indemnitor does not assume the defense of, or
if after so assuming Indemnitor fails to defend, any such
claim or action, then Indemnitee may defend against such
claim or action in such manner as it may deem appropriate
(provided that Indemnitor may participate in such defense
at its own expense) and Indemnitee may settle such claim or
litigation on such terms as it may deem appropriate and in
good faith, and Indemnitor shall promptly reimburse Indemnitee
for the amount of all expenses, legal and otherwise,
reasonably and necessarily incurred by Indemnitee in
connection with the defense against the settlement of such
claim or action. If no settlement of such claim or litigation
is made, Indemnitor shall satisfy any judgment rendered with
respect to such claim or in such action, before Indemnitee
is required to do so, and pay all expenses, legal or
otherwise, reasonably and necessarily incurred by Indemnitee
in the defense of such claim or litigation.
D. Judgment. If a judgment is rendered against Indemnitee in
any action covered by the indemnification hereunder, or any
lien in respect of such judgment attaches to any of the
assets of Indemnitee, Indemnitor shall immediately upon
such entry or attachment pay such judgment in full or
discharge such lien unless, at the expense and direction of
Indemnitor, an appeal is taken under which the execution of
the judgment or satisfaction of the lien is stayed. If and
when a final judgment is rendered in any such action,
Indemnitor shall forthwith pay such judgment or discharge
such lien before Indemnitee is compelled to do so.
9. Bulk Sales Act and Non-Assumption of Liabilities.
A. Bulk Sales Act. Each of SPI and ▇▇▇ does hereby jointly and
severally indemnify and hold harmless each member of the NVAL
Group against any claims made by creditors of SPI or ▇▇▇,
including but not limited to any losses, reasonable expenses
and attorney fees which are incurred by any member of the NVAL
Group as the result of any litigation, action, or proceeding
which may arise out of any failure of SPI or ▇▇▇ to comply
with the bulk sales act of either California or of Georgia.
18
B. Non-Assumption of Liabilities. Except and only except as
expressly stated to the contrary in this Agreement, no member
of the NVAL Group does or will hereby assume or be responsible
for any liability or obligation whatsoever of any of the
members of the SPI Group.
10. Preclosing Payment. If and only if the Closing Date has not
occurred on or before January 3, 1997, then NVAL shall on such date deliver
the Preclosing Payment to ▇▇▇. If the Closing subsequently occurs pursuant
to this Agreement, then the Preclosing Payment shall be applied in the manner
described in Section 7B6 hereof. If the Closing does not subsequently
occur pursuant to this Agreement, then the Preclosing Payment shall be
returned by ▇▇▇ to NVAL no later than March 1, 1997. Failure by ▇▇▇ to
timely return such payment shall be deemed a default by ▇▇▇ under the
Consulting Agreement.
11. Termination.
A. Termination of Agreement. Certain of the parties hereto
may terminate this Agreement as provided below:
1. The parties hereto may terminate this Agreement by
written consent at any time prior to the Closing.
2. Any member of the NVAL Group may terminate this
Agreement by giving written notice to SPI at any time
prior to the Closing (a) in the event any member of
the SPI Group has breached any material representation,
warranty, or covenant contained in this Agreement in
any material respect, NVAL has notified SPI of the
breach, and the breach has continued without cure for
a period of 30 days after the notice of breach or (b)
if the Closing shall not have occurred on or before
February 28, 1997, by reason of the failure of any
condition precedent under Section 6A hereof (unless
the failure results primarily from any member of the
NVAL Group itself breaching any representation, warranty,
or covenant contained in this Agreement).
3. Any member of the SPI Group may terminate this Agreement
by giving written notice to NVAL at any time prior to
the Closing (a) in the event any member of the NVAL
Group has breached any material representation, warranty,
or covenant contained in this Agreement in any material
respect, SPI has notified NVAL of the breach, and the
breach has continued without cure for a period of
30 days after the notice of breach or (b) if the Closing
shall not have occurred on or before February 28, 1997,
by reason of the failure of any condition precedent
under Section 6B hereof (unless the failure results
primarily from any member of the SPI Group itself
breaching any representation, warranty, or covenant
contained in this Agreement).
19
B. Effect of Termination. If any party hereto terminates this
Agreement pursuant to Section 11A hereof, all rights and
obligations of the parties hereunder shall terminate without
any liability of any party to any other party (except for
any liability pursuant to Section 10 hereof or of any
party then in breach).
12. Miscellaneous Provisions.
A. Survival of Representations. All statements contained herein
or in any certificate or other instrument delivered by or
on behalf of any of the parties hereto or in connection with
the transactions contemplated hereby shall be deemed
representations, warranties, covenants and agreements
made by the respective parties to this Agreement and shall
survive the consummation of the transactions contemplated
herein.
B. Specific Performance. The parties acknowledge that irreparable
damage would result if this Agreement is not specifically
enforced and that, therefore, the rights and obligations of
the parties under this Agreement may be enforced by a decree
of specific performance issued by a court of competent
jurisdiction. Such remedy shall, however, not be exclusive and
shall be in addition to any other remedies which any party may
have under this Agreement or otherwise.
C. Waiver of Right to Rescind. If the transactions contemplated
hereby are consummated, each party hereto waives
(notwithstanding any breach by any party of its representations,
warranties, or covenants set forth in this Agreement) any
rights it may have to rescind either this Agreement or the
transactions contemplated hereby. The foregoing waiver shall
not affect any other rights or remedies available to the
parties under this Agreement or otherwise.
D. Notices. This Section governs the transmission of all notices.
1. Address.
a. To Any Member of the NVAL Group. All notices to any
member of the NVAL Group must be delivered to ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, Attn:
Vice President, General Counsel, or such other
address of which such party notifies SPI.
20
b. To Any Member of the SPI Group. All notices to any
member of the SPI Group must be delivered to
__________________ with a copy to: ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, Esq., Doffermyre ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, or to such other address of
which such party has notified NVAL.
2. Manner of Delivery. All notices shall be hand delivered
or sent by (a) registered or certified mail, postage
prepaid, with return receipt requested; or (b) recognized
overnight courier service.
3. Effective Time of Notice. Notices shall be deemed
delivered (a) upon receipt if delivered by hand; (b)
three business days after mailing if mailed (provided
that any such mailed notice is sent by certified mail,
postage prepaid, with return receipt requested and
a return receipt is received); or (c) one business day
after deposit with an overnight courier service if
delivered by overnight courier.
E. Pronouns. The use of the neuter singular pronoun to refer to
any party shall be deemed a proper reference even though
such party may be an individual, group of individuals,
association, partnership, or corporation or groups of
corporations. The necessary grammatical changes required
to make the provisions of this Agreement apply in the plural
sense where a party consists of more than one Person shall
in all instances be assumed as though in each case fully
expressed.
F. Applicable Law. Subject to the following sentence, this
Agreement shall be governed by, construed, and enforced in
accordance with the laws of Georgia without giving effect
to its conflict of laws principles or rules. Notwithstanding
the foregoing, each of the California Assignment and the
California Note shall be governed by, construed, and enforced
in accordance with the laws of California without giving
effect to its conflict of laws principles or rules.
G. Expenses. Whether or not the transactions contemplated
hereby are consummated, the parties shall pay their own
respective expenses.
H. Attorney Fees. In the event of any litigation arising out
of this Agreement, the non-prevailing party will pay the
expenses of the prevailing party, including, without
limitation, reasonable attorney and accounting fees.
21
I. Time of Essence. Time is of the essence under this Agreement,
including the Notes.
J. Headings. The headings in this Agreement are solely for
convenience of reference and shall be given no effect in the
construction or interpretation of this Agreement.
K. Publicity. No member of the SPI Group shall issue any press
release or make any other public statement relating to or
connected with or arising out of this Agreement or the
matters contained herein, without obtaining the prior
written approval of NVAL of the contents and the manner of
presentation and publication thereof. At least one day
prior to issuing any press release concerning this
Agreement, NVAL shall provide a proposed draft thereof to
▇▇▇ and shall in good faith consider any comments ▇▇▇
may have, provided that (1) such comments are provided to
NVAL within 24 hours of delivery of the press release by
NVAL to ▇▇▇ and (2) NVAL shall have no legal obligation
to revise the press release.
L. Severability. Any term or provision of this Agreement that
is invalid or unenforceable in any situation in any
jurisdiction shall not affect the validity or enforceability
of the remaining terms and provisions hereof or the validity
or enforceability of the offending term or provision in any
other situation or in any other jurisdiction.
M. No Third Party Beneficiary. This Agreement does not confer
any rights or remedies upon any Person not a party hereto.
N. Arbitration. Any dispute or controversy arising out of,
based on, or in connection with this Agreement, or any
transaction contemplated hereby shall, subject to the other
provisions of this Section 12N, be settled by arbitration
to be held in Atlanta, Georgia in accordance with the rules
then in effect of the American Arbitration Association or
any successor thereto. The arbitrator may grant injunctions
or other relief (including, by way of example and not by
limitation, allowing a party hereto to offset its
obligations under or exercise rights of recoupment with
respect to the Notes or other instruments) in such dispute
or controversy. The decision of the arbitrator shall be
final, conclusive, and binding on the parties to the
arbitration. Judgment may be entered on the arbitrator's
decision in any court having jurisdiction, and the parties
irrevocably consent to the jurisdiction of the Georgia
courts for this purpose. In any such arbitration, the
parties waive personal service of any process or other
papers and agree that service thereof may be made in
accordance with Section 12D hereof. The losing party in
such arbitration shall pay all the costs and expenses of
such arbitration and all the reasonable counsel fees
and expenses of all the other parties thereto.
Notwithstanding the foregoing provisions of this Section 12N,
any dispute or controversy arising out of, based on, or in
connection with either or both of the Noncompetition
22
Agreements shall be brought in the forum described in Section
4I of each of the Noncompetition Agreements.
O. Further Assurances. From time to time subsequent to the
Closing Date, each party shall at the request of any other
party execute and deliver such additional instruments,
conveyances, transfers and other assurances and take such
other actions as the requesting party may reasonably request
in order to complete the transactions contemplated by this
Agreement and to carry out its provisions.
P. Assignment. No member of the SPI Group may assign its
rights or delegate its duties under this Agreement.
Q. Entire Agreement; Amendments. This Agreement contains the
entire understanding of the parties with respect to the
subject matter contained herein. This Agreement supersedes
all prior agreements and understandings between the parties
with respect to such subject matter. This Agreement may be
modified only by an agreement in writing signed by the
parties hereto. The terms "hereof, "hereunder" and similar
terms refer to the specified provision or provisions of
this Agreement for Assignment of License Interests and
Related Matters.
IN WITNESS WHEREOF, the parties have executed this Agreement for
Assignment of License Interests and Related Matters as of the Execution
Date.
NATIONAL VISION ASSOCIATES, LTD. EYECARE LEASING, INC.
By /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, O.D.
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, O.D.
Title: Vice President Title: President
NVAL VISIONCARE SYSTEMS ▇▇▇▇▇▇▇-▇▇▇▇▇▇▇▇, INC.
OF CALIFORNIA, INC.
By /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, O.D.
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, O.D.
Title: Vice President Title: President
NVAL VISIONCARE SYSTEMS
OF NORTH CAROLINA, INC.
By /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, O.D.
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, O.D.
Title: Vice President
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, O.D.
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, O.D.
23
AGREEMENT FOR
ASSIGNMENT OF LICENSE INTERESTS AND
RELATED MATTERS
INDEX TO EXHIBITS AND SCHEDULES
EXHIBITS: SCHEDULES:
A ▇▇▇▇ of Sale 1W Miscellaneous Assets
B California Assignment 4A8 Optometric Sublicenses
C California Note 4A10 Contracts
D Consulting Agreement
E Goodwill Assignment
F Master Assignment Agreement
G-1 Noncompetition Agreement
between NVAL and ▇▇▇▇▇▇▇
G-2 Noncompetition Agreement
between NVAL and ▇▇▇▇▇▇▇▇
H-1 Noncompetition Note in favor
of ▇▇▇▇▇▇▇
H-2 Noncompetition Note in favor
of ▇▇▇▇▇▇▇▇
I Optometric Sublicenses
J-1 Technical Assistance Agreement
between NVAL and ▇▇▇▇▇▇▇
J-2 Technical Assistance Agreement
between NVAL and ▇▇▇▇▇▇▇▇
K Termination Agreement
L Termination and Goodwill Note
M West Virginia Assignment
N West Virginia Note
O Opinion of Counsel for SPI Group
P Closing Certificate by ▇▇▇▇▇▇▇
and ▇▇▇▇▇▇▇▇
Q Closing Certificate by Officer
of NVAL