-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, OnI9olRLIhgF90IzUog+RbnrNr909XIWujnZQ4b8juNfkX6vlpiQvWRThu1fwB2Y GG4gpmTWmMC2lyGkrO55rg== 0001017386-01-500078.txt : 20010910 0001017386-01-500078.hdr.sgml : 20010910 ACCESSION NUMBER: 0001017386-01-500078 CONFORMED SUBMISSION TYPE: SB-2/A PUBLIC DOCUMENT COUNT: 13 FILED AS OF DATE: 20010907 FILER: COMPANY DATA: COMPANY CONFORMED NAME: LASIK AMERICA INC CENTRAL INDEX KEY: 0001157814 STANDARD INDUSTRIAL CLASSIFICATION: [] FILING VALUES: FORM TYPE: SB-2/A SEC ACT: 1933 Act SEC FILE NUMBER: 333-68942 FILM NUMBER: 1732592 BUSINESS ADDRESS: STREET 1: 6646 INDIAN SCHOOL ROAD NE CITY: ALBUQUERQUE STATE: NM ZIP: 87110 BUSINESS PHONE: 5058372020 SB-2/A 1 file001.txt REGISTRATION STATEMENT AMENDMENT NO. 1 As filed with the U.S. Securities and Exchange Commission on September 6, 2001 REGISTRATION NO. 333-68942 - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------------------ AMENDMENT 1 to FORM SB-2 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ------------------------ LASIK AMERICA, INC. (Name of Small Business Issuer in its charter) NEVADA 8741 88-0490720 ---------------------------- ----------------- ---------------- (State or other jurisdiction (Primary Standard (I.R.S. Employer of Industrial Classification Identification incorporation or organization) Code Number) Number) ------------------------------- 6646 INDIAN SCHOOL ROAD, N.E. ALBUQUERQUE, NEW MEXICO 87110 505-837-2020 (ADDRESS AND TELEPHONE NUMBER OF PRINCIPAL EXECUTIVE OFFICES) -------------------------------------------------- HOWARD P. SILVERMAN, CHIEF EXECUTIVE OFFICER LASIK AMERICA, INC. 6646 INDIAN SCHOOL ROAD, N.E. ALBUQUERQUE, NEW MEXICO 87110 505-837-2020 (Name, Address, And Telephone Number Of Agent For Service) ------------------------------------------------------------------ COPIES TO: GREGORY BARTKO, ESQ. Law Office of Gregory Bartko 3475 Lenox Road, Suite 400 Atlanta, Georgia 30326 (404) 238-0550 (telephone) (404) 238-0551 (facsimile) ------------------------ 1 APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as practicable after this registration statement becomes effective. If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering: / /__________________ If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering: / /__________________ If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering: / /__________________ If delivery of the prospectus is expected to be made pursuant to Rule 434, check the following box: / /__________________ ------------------------------ THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE COMPANY SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE. - -------------------------------------------------------------------------------- CALCULATION OF REGISTRATION FEE PROPOSED PROPOSED MAXIMUM MAXIMUM TITLE OF EACH CLASS OF AMOUNT TO OFFERING PRICE OFFERING SECURITIES TO BE REGISTERED BE REGISTERED PER SHARE(1) PRICE(1) FEE - ---------------------------- ------------- -------------- --------------- --- Units, comprised of one share of common stock, par value $.001 per share and one redeemable common stock purchase warrant, each warrant to purchase one share of common stock (2)(3)...................... 550,000 $6.10 $3,355,000 $833.75 Common stock underlying redeemable warrants included in the units (3)............ 550,000 $7.20 $3,960,000 $990.00 Representative's warrants(3). 42,500 $.001 $ --- $ 42.50 2 Common stock issuable upon exercise of the representative's warrants(4). 42,500 $9.90 $ 420,750 $105.19 Redeemable warrants issuable upon exercise of the representative's warrants(4). 42,500 $.165 $ 7,013 $ 1.75 Common stock issuable on exercise of redeemable warrants included in the representative's warrants(2). 42,500 $9.90 $ 420,750 $105.19 Total................... --- --- $8,163,513 $2,078.38 ========== ========= (1) Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457 of the Securities Act. (2) Includes 125,000 shares of common stock beneficially owned by Howard P. Silverman, selling shareholder, that are registered for resale in this registration statement. (3) Includes 125,000 redeemable common stock purchase warrants beneficially owned by Howard P. Silverman, selling shareholder, that are registered for resale in this registration statement. (4) No registration fee is required pursuant to Rule 457 of the Securities Act. (5) Pursuant to Rule 416, we are registering additional securities as may become issuable pursuant to the anti-dilution provisions of the redeemable warrants, the representative's warrants and the redeemable warrants underlying the representative's warrants. 3 SUBJECT TO COMPLETION, DATED SEPTEMBER ___, 2001 INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE. LASIK AMERICA, INC. 425,000 UNITS This is an initial public offering by us of 425,000 units of LASIK America, Inc., each unit consists of one share of common stock and one redeemable common stock purchase warrant, each warrant exercisable to purchase one share of common stock. This prospectus also includes the offer and resale of 125,000 units on behalf of a selling shareholder identified in this prospectus. Proceeds from the units sold on behalf of the selling shareholder will not be received by us, rather all proceeds from those units will be received by the selling shareholder, who is our chief executive officer. Before this offering, there has been no public market for any of our securities. We anticipate that the initial public offering price will be $6.10 per unit, which consists of $6.00 per share of common stock and $.10 per warrant. The common stock and the warrants will trade as separate securities immediately upon the completion of this offering. Please see the risk factors beginning on page 5 to read about factors you should consider before buying any of our securities. Neither the United States Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per Unit Total -------- -------- o Price to the public..................... $6.10 $2,592,500 o Underwriting discounts and commissions.. $0.79 $ 335,750 o Proceeds, before expenses, to LASIK America..................... $5.31 $2,256,750 o Proceeds, before expenses, to the selling shareholder................... $5.31 $ 663,750 Delivery of the securities offered by this prospectus will be made on or about September , 2001. The underwriters are offering the units on a best efforts basis. The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities, and we are not soliciting an offer to buy these securities, in any state where the offer and sale is not permitted. WEST AMERICA SECURITIES CORP. Prospectus dated September , 2001 1 Table of contents Page No. -------- Prospectus summary.......................................... 2 Risk factors................................................ 5 Cautionary note regarding forward-looking statements........ 10 Use of proceeds............................................. 11 Dividend policy............................................. 12 Capitalization.............................................. 12 Dilution.................................................... 13 Selected financial data..................................... 14 Management's discussion and analysis of financial condition and results of operations................................. 15 Business.................................................... 18 Management.................................................. 29 Certain transactions........................................ 33 Principal stockholders and the selling shareholder.......... 33 Description of securities................................... 35 Shares eligible for future sale............................. 38 Underwriting................................................ 39 Plan of distribution for selling shareholder................ 43 Legal matters............................................... 44 Experts..................................................... 44 Index to financial statements............................... F-1 1 Prospectus summary This summary highlights information contained elsewhere in this prospectus. Investors should read the entire prospectus carefully, including the financial statements which are a part of this prospectus. Our business LASIK America, Inc. provides laser vision correction procedures to individuals at our center in Albuquerque, New Mexico. Our ophthalmologist and those with which we are affiliated, provide these services using state-of-the-art excimer laser technology. Corporate background On March 21, 2001, we formed our company as a Nevada corporation. Our executive office is located at 6646 Indian School Road, N.E., Albuquerque, New Mexico and our telephone number is (505) 837-2020. In this prospectus, "LASIK America", "we", "us" and "our" refer to LASIK America, Inc. The offering Securities that we are offering.............. 425,000 units, each unit consisting of one share of common stock and one common stock purchase warrant, each warrant exercisable to purchase one share of common stock at an exercise price of $7.20 per share; Securities offered on behalf of the selling shareholder.................... 125,000 units offered for resale; Common stock outstanding before this offering................................... 2,082,043 shares; Common stock to be outstanding after this offering.............................. 2,507,043 shares; Redeemable common stock purchase warrants outstanding before this offering........... 125,000 warrants; Redeemable common stock purchase warrants to be outstanding after this offering...... 550,000 redeemable common stock purchase warrants included as a part of the units offered by this prospectus; Use of proceeds.............................. Laser and refractive equipment; office build-out expenditures; expenses associated with one new center; advertising; accounts payable; working capital and general corporate purposes, which includes offering expenses, salaries, cost of additional personnel, support and management systems, capital costs for computers and related equipment. Proposed Over-the-Counter Electronic Bulletin Board symbols Common stock ........................... "LASK" Redeemable warrants..................... "LASK W" Unless stated otherwise, all information in this prospectus assumes: o an initial public offering price of $6.10 per unit; and o the exercise of 42,500 representative's warrants and the issuance of the securities underlying the warrants. Summary financial data The following table summarizes the financial data of our business. This information is qualified by reference to, and should be read together with, the historical financial data for the period March 21, 2001 (inception) through July 31, 2001 and should be read in conjunction with our audited financial statements included elsewhere in this prospectus. The historical financial data as of July 31, 2001 is derived from and should be read in conjunction with our audited financial statements included elsewhere in this prospectus. The data presented below should also be read in conjunction with "Management's Discussion and Analysis of Financial Condition and Results of Operations" and the financial statements and accompanying notes appearing elsewhere in this prospectus. March 21, 2001 (inception) through July 31, 2001 --------------------------- Statement of operations data: Revenues................................... $ 184,040 Cost of revenues........................... 79,353 Operating costs and expenses............... 12,609,640 ---------- Loss from operations....................... (12,504,953) Interest expense........................... (3,884) ---------- Net loss.................................. $(12,508,837) ============ Basic and diluted net loss per share....... $(6.01) ========== Shares used in computing basic and diluted net loss per share....................... 2,082,043 ========== The following table includes a summary of our balance sheet at July 31, 2001; o on an actual basis; and o on an as adjusted basis giving effect: 3 o to the issuance of 425,000 units, consisting of one share of common stock and one redeemable common stock purchase warrant , offered by us at an offering price of $6.10 per unit, or $6.00 per share and $.10 per warrant. Balance sheet data: July 31, 2001 As actual adjusted ----------- ---------- Cash and cash equivalents................ $ 19 $ 2,256,769 Total working capital (deficit).......... (178,032) 2,078,718 Total assets............................. 229,712 2,486,462 Current portion of long term liabilities...................... 110,263 110,263 Long term debt........................... 105,820 105,820 Total liabilities........................ 293,791 293,791 Total shareholders' (deficit) equity..... (64,079) 2,192,671 4 Risk factors The purchase of our securities involves a high degree of risk. Accordingly, each prospective purchaser, before placing an order for any units, should carefully read this prospectus in its entirety and should consider the following risks and speculative features inherent in and affecting this offering and our business, as well as general investment risks. An investment in our securities should be made only by persons who can afford an investment involving such risks and is suitable only for persons able to sustain the loss of their entire investment. WE BEGAN PROVIDING OUR SERVICES IN MAY 2001 AND HAVE A VERY BRIEF AND LIMITED OPERATING HISTORY UPON WHICH YOU MAY EVALUATE OUR BUSINESS AND PROSPECTS. Since we started providing our services in May 2001, we have a limited operating history. As a result, we have a limited basis upon which you may evaluate our business and prospects. Our prospects must be considered in light of the risks, expenses, delays, problems and difficulties frequently experienced by early stage companies. WE HAVE INCURRED NET LOSSES SINCE COMMENCING OUR BUSINESS AND EXPECT LOSSES FROM OPERATIONS IN THE FUTURE. We have not achieved profitability and expect to continue to incur operating losses for the foreseeable future. For the period from the commencement of our operations (March 21, 2001) until July 31, 2001, our net loss was $12,508,837 and our accumulated deficit at that same date was $12,508,837. We expect to continue to incur significant operating and capital expenditures and, as a result, we expect significant net losses in the future and we will need to generate significant revenues to achieve and maintain profitability. We will continue to need additional capital in order to effectuate our business plan and meet our operational challenges. IF WE ARE UNABLE TO COMPLETE OUR PUBLIC OFFERING, ALTERNATE FUNDING WILL BE NEEDED AND WE WILL HAVE TO MODIFY OUR BUSINESS OPERATIONS ACCORDINGLY. Based on our current operating plan, we anticipate that the net proceeds of this offering and cash provided by operations will allow us to meet our cash and capital requirements for at least 12 months following the date of this prospectus. Our accountants have included in a note in their report that our financial statements have been prepared assuming we will continue as a going concern. If appropriate financing is not obtained by us through our public offering, we intend to modify our operations accordingly. We may require additional funding sooner than anticipated. If we raise additional capital through the sale of equity, including preferred stock, or convertible debt securities, our stockholders may experience dilution. We currently do not have a credit facility or any commitments for additional financing. We cannot be certain that additional financing will be available when and to the extent required. If adequate funds are not available on acceptable terms, we may be unable to fund our expansion, develop or enhance our services or respond to competitive pressures. OUR MANAGEMENT WILL HAVE BROAD DISCRETION TO ALLOCATE THE OFFERING PROCEEDS AND YOU WILL LIKELY HAVE NO VOICE AS TO HOW OUR MANAGEMENT WILL USE THESE NET PROCEEDS. We expect to use total net proceeds of approximately $2,256,750 for the purposes described under "Use of Proceeds." Our management will have broad discretion to allocate the proceeds of this offering, including 5 proceeds currently specifically allocated as described in this prospectus, and any other cash resources to such uses as they determine to be in our best interests. The amounts actually allocated to each expense category and the source of the cash so allocated, may vary significantly, depending on a number of factors, including the amount of future revenue growth, the amount of cash generated or used by our operations and the success of our marketing efforts for our laser vision correction procedures. A SIGNIFICANT AMOUNT OF THE NET PROCEEDS OF THIS OFFERING MAY BE USED TO BENEFIT OUR MANAGEMENT AND OTHER INSIDERS. The allocation of the net proceeds from this offering includes approximately 26.4% for working capital and general corporate purposes and 11.1% for the payment of outstanding accounts payable. Substantial amounts of our working capital will be applied towards the payment of salaries and related costs of our management personnel. Accordingly, substantial amounts of the net proceeds we receive from this offering may ultimately be used to benefit our officers, consultants or other insiders. SINCE THE LASER REFRACTIVE SURGERY MARKET IS RELATIVELY NEW, WE DO NOT KNOW IF OUR SERVICES WILL GENERATE WIDE SPREAD MARKET ACCEPTANCE. The commercial market for laser refractive surgery in the United States is relatively new and we do not know if these procedures will generate widespread market acceptance. Several factors may contribute to refractive surgery not achieving broad market acceptance, which include: o cost of the procedure; o effectiveness of conventional eye correction technologies including eye glasses and contact lenses; o general resistance to surgery; o availability of other surgical techniques; o the short history of laser refractive surgery in the United States; o side effects; and o any resistance by third-party payors to reimburse patients for elective laser vision correction. POTENTIAL SIDE EFFECTS AND NEGATIVE LONG-TERM RESULTS OF LASER REFRACTIVE SURGERY COULD DAMAGE THE DEMAND FOR OUR SERVICES. There are concerns about the safety and efficacy of the performance of laser refractive surgery. These concerns include: o the predictability and stability of results; o complications and side effects including: o post-operative pain; o corneal haze during healing; o glare/halos; 6 o decrease in contrast sensitivity; o temporary increases in intraocular pressure in reaction to post-procedure medication; o modest fluctuations in astigmatism and modest decreases in best corrected vision; o loss of fixation during the procedure; o unintended over-or under-corrections; instability, reversion or regression of effect; and o corneal scars, corneal ulcers, and corneal healing disorders. The occurrence of any of these or any other complications may damage the demand for the services we offer. THE TECHNOLOGIES WE USE IN OUR LASER VISION CORRECTION PROCEDURES ARE SUBJECT TO RAPID TECHNOLOGICAL CHANGE AND COULD CAUSE US TO MAKE SIGNIFICANT CAPITAL INVESTMENT IN NEW EQUIPMENT. Our market is characterized by rapid technological changes. Newer technologies, techniques or products for the treatment of refractive vision disorders, could be developed with better performance than the excimer lasers that we currently use. The availability of new and better ophthalmic laser technologies or other surgical or non-surgical methods for correcting refractive vision disorders could require us to make significant investments in technology, render our current technology obsolete and have a significant negative impact on our business and results of operations. WE MAY NOT COMPETE EFFECTIVELY WITH OTHER EYE CARE SERVICES COMPANIES THAT HAVE MORE RESOURCES AND EXPERIENCE THAN WE DO. Many of our competitors have substantially greater financial, technical, managerial, marketing, and other resources than we do may compete more effectively than we can. We compete with Laser Vision Centers, Inc., LCA Vision, Aris Vision, NovaMed Eyecare Management, LLC, TLC The Laser Center, Inc., Clear Vision Laser Centers, Inc., and other entities, including other refractive laser center companies, hospitals, individual ophthalmologists and optometrists, other surgery and laser centers, eye care clinics and providers of retail optical products in offering our services and products. Our surgical procedures compete with other surgical and non-surgical treatments for refractive disorders, including eyeglasses, contact lenses, other types of refractive surgery, such as radial keratotomy, and technologies currently under development. If our competitors offer laser vision correction or other refractive surgery services at lower prices than we do, we may have to lower the prices we charge, which will adversely affect our results of operations. THE DEMAND FOR OUR LASER REFRACTIVE SURGERY PROCEDURES MAY BE ADVERSELY AFFECTED BY HEALTH CARE REFORM INITIATIVES. The continuing effort of government regulators of health care services to contain or reduce the costs of health care may reduce our revenues and profitability by increasing our regulatory burden or increasing our administrative costs associated with delivering services to our customers. We cannot predict the effect that health care reforms may have on our business, and it is possible that any reforms will hurt our business. 7 SIGNIFICANT DECREASES IN EXCIMER LASER PRICES COULD HARM OUR BUSINESS BY MAKING IT MORE ATTRACTIVE FOR EYE SURGEONS TO BUY THEIR OWN LASERS AND FORCE US TO LOWER OUR PRICES. significant reduction in the price of excimer lasers could reduce the demand for our services by making it economically more attractive for eye surgeons to buy excimer lasers for themselves instead of utilizing our centers. Also, excimer laser price decreases could force us to reduce our fees in response to this reduction in demand or as a means to remain competitive with other laser providers. WE ARE DEPENDENT UPON A LIMITED NUMBER OF SUPPLIERS FOR OUR LASER SURGERY EQUIPMENT AND WE DON'T HAVE A CONTINGENCY PLAN FOR ALTERNATIVE SUPPLIERS, SO IF ANY OF THESE SUPPLIERS WERE UNABLE OR UNWILLING TO MEET OUR NEEDS, WE MAY NOT BE ABLE TO EQUIP OUR CENTER WITH THE APPROPRIATE TECHNOLOGY. We are dependent on a small number of manufacturers for our supply of ophthalmic lasers. To our knowledge, five companies, Bausch & Lomb, Nidek, Summit Technologies, Inc., Autonomous Technologies Corporation and VISX, Inc. have been approved by the United States Food and Drug Administration for commercial sale of excimer lasers in the U. S. If any of these manufactures were for any reason to discontinue commercial sale of ophthalmic lasers, or be unwilling or unable to meet our needs, we may not be able to equip our centers with the appropriate technology. WE MAY BE FORCED TO ALTER THE WAY WE MARKET OUR SERVICES AND THE MANNER IN WHICH WE ENTER INTO RELATIONSHIPS WITH OUR EQUIPMENT PROVIDERS, SERVICE PROVIDERS, OPHTHALMOLOGISTS, OPTOMETRISTS, AND OTHER HEALTH CARE PROVIDERS AS A RESULT OF GOVERNMENT REGULATIONS. We are subject to extensive federal, state, local and foreign laws, rules and regulations, including: o restrictions on the approval, distribution, and use of medical devices; o anti-kickback statutes; o fee-splitting laws; o corporate practice of medicine and optometric restrictions; o self-referral laws; o anti-fraud provisions; o facility license requirements and certificates of need; o conflict of interest regulations; and o sales and use taxes Many of these laws and regulations are ambiguous, and courts and regulatory authorities have provided little clarification. Moreover, state and local laws vary from jurisdiction to jurisdiction. As a result, we may not always be able to accurately interpret applicable law, and some of our activities could be challenged. Failure to comply with applicable FDA requirements could subject us, and the ophthalmologists who use our centers to enforcement actions, including 8 product seizure, recalls, withdrawal of approvals and civil and criminal penalties. Further, failure to comply with regulatory requirements, or any adverse regulatory action could result in limitations or prohibitions on our use of excimer lasers. See "Business--Government regulation." OUR MANAGEMENT WILL CONTROL APPROXIMATELY 44.5% OF OUR COMMON STOCK AFTER THIS OFFERING AND THEIR INTERESTS MAY BE DIFFERENT FROM AND CONFLICT WITH YOURS AND AS A RESULT, YOU MAY HAVE NO EFFECTIVE VOICE IN OUR MANAGEMENT, INCLUDING THE ELECTION OF DIRECTORS AND THE APPROVAL OF SIGNIFICANT CORPORATE TRANSACTIONS. Following this offering, our executive officers and directors will beneficially own or control a total of approximately 44.5% of our outstanding common stock, assuming no exercise of the redeemable common stock purchase warrants. Accordingly, if our management acts together, they have the power to control the election of all of our directors and the approval of significant corporate transactions for which the approval of our stockholders is required. If you purchase our securities, you may have no effective voice in our management. PROVIDING LASER SURGERY PROCEDURES AND RELATED EYE CARE SERVICES ON OUR PATIENTS COULD SUBJECT US TO MALPRACTICE, PRODUCT LIABILITY, AND OTHER CLAIMS WHICH COULD EXCEED OUR INSURANCE COVERAGE OR FORCE US TO OBTAIN CASUALTY INSURANCE WHICH MAY NOT BE AVAILABLE AT COMMERCIALLY REASONABLE RATES. Providing our services to our patients subjects us to the potential that significant physical injury will occur to patients at our centers and the resulting risk of malpractice, product liability and other claims. Our insurance may not be adequate to satisfy claims or protect us or our affiliated providers against these claims. Furthermore, our insurance coverage may not continue to be available at acceptable costs and terms. WE ARE NOT LICENSED TO PRACTICE MEDICINE OR OPTOMETRY, SO IN ORDER FOR US TO DELIVER OUR EYE CARE SERVICES, WE ARE DEPENDENT, IN PART, UPON OUR RELATIONSHIPS WITH OUR MEMBER-PHYSICIANS AND OPTOMETRISTS AND OUR ABILITY TO ENTER INTO AFFILIATIONS WITH LICENSED MEDICAL AND OPTOMETRIC PROFESSIONALS. Since we do not practice medicine or optometry, our activities are limited to establishing centers at which ophthalmologists and other eye care professionals that we employ, and others with whom we've established affiliations, render eye care services. Accordingly, our success depends upon our ability to attract talented physicians that we desire to employ and our ability to develop relationships with affiliated physicians and to enter into agreements with health care providers, including institutions, independent physicians and optometrists, to render surgical and other professional services at centers owned or managed by us. There can be no assurance that we will be able to enter into these agreements with health care providers on satisfactory terms, if at all. Our inability to enter into these affiliations would likely limit our revenues, our services, and our ability to expand our operations. WE FINANCE THE PURCHASES OF OUR LASER SURGERY EQUIPMENT WHICH INCREASES OUR LEVERAGE AND FINANCE COSTS AND IF WE DO NOT SATISFY OUR DEBT PAYMENTS WHEN DUE, WE MAY BE FORCED TO FORFEIT OUR EQUIPMENT. We finance the purchases of our excimer laser equipment. The use of leverage to finance our equipment increases our risk of loss as opposed to if we borrowed a smaller portion or none of the purchase price of this equipment. Our risk is increased because we must satisfy these obligations on specific dates, regardless of our revenues. If we do not 9 meet our debt service payments when due, we may be forced to forfeit the equipment securing the debt. WE NEED THE CONTINUED AVAILABILITY OF THE EXPERTISE AND STRATEGIC PLANNING OF OUR CHIEF EXECUTIVE OFFICER, HOWARD P. SILVERMAN AND OTHER KEY PERSONNEL EXPERIENCED IN THE LASER REFRACTIVE SURGERY INDUSTRY. We believe that the efforts and industry knowledge of our senior management, key employees and contractors, particularly that of our chief executive officer, Howard P. Silverman, in the laser refractive surgery industry, are essential to our operations and growth. Dr. Silverman is responsible for our strategic planning, and the loss of his services would have an adverse affect on our long-term operations. We have not, at this date, entered into any employment agreement with Dr. Silverman, nor have we obtained key man life insurance on Dr. Silverman's life. If we do not succeed in retaining or motivating our current personnel or in hiring additional qualified employees, our business will be materially adversely affected. In addition, competition for personnel in our industry, including the doctors who perform our services, is intense and there can be no assurance that we will be able to attract and retain the necessary personnel. OUR INABILITY TO LIST OUR SECURITIES ON A NATIONAL SECURITIES EXCHANGE MAY IMPAIR OUR ABILITY TO DEVELOP A PUBLIC MARKET FOR OUR SECURITIES. We have not made an application to list the units, our common stock, or the redeemable common stock purchase warrants on any national securities exchange. Our inability to list our securities on a national securities exchange may impair our ability to develop a liquid and orderly market in our securities after this offering is completed. Further, the prices and volume of trading in our securities may be adversely affected since our securities will not be listed on a national securities exchange. Our underwriter lacks experience as an underwriter of securities in public offerings, and this lack of experience may impair our ability to develop a public market for our common stock. The representative of the underwriters has not conducted, managed or co-managed public underwritings of securities except only in a limited number of situations involving the public offering of securities. This lack of experience may impair our ability to develop a public market for our securities. We can give no assurances that the representative of the underwriters will be able to act as a market maker or that any broker-dealer will become a market maker in our securities. If there are no market makers for our securities, or if only a few market makers choose to act as such for our securities, then the market price of our common stock and the redeemable common stock purchase warrants could be adversely affected. Cautionary note regarding forward looking statements This prospectus contains forward-looking statements. These forward-looking statements are not historical facts, but rather are based on our current expectations, estimates, and projections about our industry, our beliefs and assumptions. Words including "may," "could," "would," "will," "anticipates," "expects," "intends," "plans," "projects," "believes," "seeks," "estimates," and similar expressions are intended to identify forward-looking statements. These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, some of which are beyond our control, are difficult to predict and could cause actual results to differ materially from 10 those expressed or forecasted in the forward-looking statements. These risks and uncertainties are described in "Risk Factors" and elsewhere in this prospectus. We caution you not to place undue reliance on these forward-looking statements, which reflect our management's view only as of the date of this prospectus. We are not obligated to update these statements or publicly release the result of any revisions to them to reflect events or circumstances after the date of this prospectus or to reflect the occurrence of unanticipated events. Use of proceeds We estimate that we will receive net proceeds of approximately $2,256,750 from our sale of the 425,000 units offered by this prospectus, assuming an initial public offering price of $6.10 per unit. These amounts are after deducting estimated underwriting discounts and commissions, and after fees and expenses of approximately $335,750, payable by us. None of the proceeds of sale of the 125,000 units offered by the selling shareholder will be received by us. We intend to use the net proceeds as follows: Net Percent proceeds of total ----------- -------- Laser and refractive equipment ........................ $ 600,000 26.6% Office build-out expenditures.......................... 85,000 3.8% Expenses of opening new center......................... 650,000 28.8% Advertising............................................ 75,000 3.3% Accounts payable and offering expenses................. 250,000 11.1% Working capital and general corporate purposes which includes salaries, cost of additional personnel, support and management systems, capital costs for computers and related equipment..................... 596,750 26.4% ---------- ------ Total.............................................. $2,256,750 100 % ========== ====== Proceeds allocated to advertising will include the costs of newspaper, radio, television, and other media spots designed to increase public awareness of our laser vision correction surgery procedures and the benefits of the procedures for our customers. Expenses of opening one additional new center in a location to be determined, office build-out expenditures and laser and refractive equipment relate to build out expenses in our Albuquerque center, consisting primarily of construction costs for up-fitting additional office and patient facilities, and possibly the cost of mobile excimer laser equipment. A small portion of our net proceeds will be utilized for expansion of internal corporate operations, which include expanding our computer network, equipment for our corporate office facilities, software, and our Web site development costs. The remaining net proceeds, or approximately 26.4% of the net proceeds, will be utilized as working capital for general corporate purposes. These purposes include salaries, additional personnel, expansion costs of our 11 operations, support and management systems, as well as capital expenses for computers and related equipment. The proposed allocation of the net proceeds represents our management's best estimate of the allocation of the net proceeds of the offering, based upon the current status of our operations, our current plans and current economic conditions. Our management may re-allocate the net proceeds among the categories listed above. We also may, when the opportunity arises, acquire or invest in complementary businesses, products or technologies. However, we have no present understandings, commitments or agreements with respect to any acquisition or investment. Any net proceeds received from the sale of the underwriter's over-allotment option will be allocated to working capital and general corporate purposes. Pending application of the net proceeds in the manner described above, we intend to invest the net proceeds in short-term, interest bearing investment grade securities. Dividend policy We have never declared or paid any cash or stock dividends on our capital stock. We intend to reinvest earnings, if any, to fund the development and expansion of our business and, as a result, we do not anticipate paying cash dividends on our common stock in the foreseeable future. The declaration of dividends will be at the discretion of our board of directors and will depend upon our earnings, capital requirements, financial position, general economic conditions, and other pertinent factors. Capitalization The following table sets forth our: o actual capitalization as of July 31, 2001; o our as adjusted capitalization as of July 31, 2001 giving effect to; o the issuance of 425,000 units, consisting of one share of common stock and one redeemable common stock purchase warrant offered by us at an offering price of $6.10 per unit, or $6.00 per share and $.10 per warrant; and o the application of the estimated net proceeds from this offering. The following table should be read in conjunction with our financial statements, related notes and other financial information included elsewhere in this prospectus. July 31, 2001 -------------------------------------- Actual As adjusted ----------- ----------- Current portion of long term liabilities. $ 110,263 $ 110,263 =========== =========== Long term debt........................... $ 105,820 $ 105,820 =========== =========== Stockholders' (deficit) equity: Preferred stock, $.001 par value; 100,000 authorized, no shares issued.. $ 0 $ 0 ----------- ----------- 12 Common stock, $.001 par value; 25,000,000 shares authorized; 2,082,043 to be issued, actual, 2,507,043 issued and outstanding, as adjusted.............. 2,082 2,507 Additional paid in capital............. 12,510,176 14,766,501 Deferred compensation.................. (67,500) (67,500) Accumulated deficit.................... (12,508,837) (12,508,837) ----------- ----------- Total stockholders' (deficit) equity. (64,079) 2,192,671 ----------- ----------- Total capitalization................. $ 152,004 2,408,754 =========== =========== The preceding table does not include the exercise of: o the redeemable common stock purchase warrants; and o 42,500 representative's warrants. Dilution As of July 31, 2001, our net tangible book value, or deficit, was $(64,079), or $(0.03) per share of common stock. Net tangible book value, or deficit, per share represents the amount of our total tangible assets less total liabilities divided by the number of shares of common stock outstanding. After giving effect to the sale of the 425,000 units offered by this prospectus and after deducting the underwriting discounts and estimated offering expenses, net tangible book value at July 31, 2001, would have been $2,192,671, or approximately $0.87 per share of our common stock. This represents an immediate increase in net tangible book value of $0.90 per share of common stock to our existing stockholders and an immediate dilution in net tangible book value of $(5.13) per share of common stock, or approximately 85.4%, to new investors. The following table illustrates this per share dilution: Assumed initial public offering price....................... $ 6.00 Net tangible book value(deficit) prior to the offering.................................................. (0.03) Increase in net tangible book value per share attributable to this offering.......................................... 0.90 As adjusted, net tangible book value per share after the offering........................................ 0.87 Dilution of net tangible book value per share to new investors................................................... $(5.13) ==== The following table summarizes, as of July 31, 2001, on an as adjusted basis, the number of shares of common stock purchased from us, the total consideration paid and the average price per share paid by existing stockholders and investors in this offering, and after giving effect to the sale of the 425,000 units offered by this prospectus, assuming an initial offering price of $6.10 per unit. The calculations are based upon total consideration given by new investors and existing stockholders before any deduction of underwriting discounts, offering expenses payable by us, and does not include the purchase of or any exercise of the redeemable common stock purchase warrants offered by this prospectus. 13 Shares purchased Total consideration Average -------------------- --------------------- price per Number Percent Amount Percent share --------- -------- ---------- -------- ---------- Existing stockholders....... 2,082,043 83% $ 73,371 2.80% $0.04 New investors........ 425,000 17% 2,550,000 97.20% $6.00 --------- ---- ---------- ------- Total............ 2,507,043 100% $2,623,371 100% ========= ==== ========== ======= Selected financial data The following selected financial data should be read in conjunction with our audited financial statements for the period March 21, 2001 (inception) through July 31, 2001 included elsewhere in the prospectus and Management's Discussion and Analysis of Financial Condition and Results of Operations. The historical selected financial data as of July 31, 2001 and for the period March 21, 2001 (inception) through July 31, 2001 are derived from and should be read in conjunction with our audited financial statements included elsewhere in the prospectus. The results of operations for the period March 21, 2001 (inception) through July 31, 2001 are not necessarily indicative of results to be expected for the current fiscal year. March 21, 2001 (inception) through July 31, 2001 -------------------------- Statement of operations data: Revenues...................................$ 184,040 Cost of revenues........................... 79,353 ---------- Gross profit............................... 104,687 Operating costs and expenses: General and administrative............... 243,369 Compensation expense related to common stock...................... 12,351,387 Depreciation............................. 14,884 ---------- Total operating costs and expenses..... 12,609,640 ---------- Loss from operations....................... (12,504,953) Interest expense........................... (3,884) ---------- Net loss...................................$(12,508,837) ========== Basic and diluted net loss per share....... $(6.01) ========== Shares used in computing basic and diluted net loss per share....................... 2,082,043 ========== 14 The following table includes a summary of our balance sheet at July 31, 2001; o on an actual basis; and o on an as adjusted basis giving effect: o to the issuance of 425,000 shares of our common stock and warrants for the purchase of 425,000 shares offered by us at an offering price of $6.10 per unit, or $6.00 per share and $.10 per warrant. Balance sheet data: July 31, 2001 ------------------------------------ Actual As adjusted ----------- ------------ Cash and cash equivalents................ $ 19 $ 2,256,769 Total working capital (deficit).......... (178,032) 2,078,718 Total assets............................. 229,712 2,486,462 Current portion of long term liabilities....................... 110,263 110,263 Long term debt........................... 105,820 105,820 Total liabilities........................ 293,791 293,791 Total shareholders' (deficit) equity..... (64,079) 2,192,671 Management's discussion and analysis of financial condition and Results of operations The following management's discussion and analysis of financial condition and results of operations should be read in conjunction with our financial statements and accompanying notes and the other financial information included elsewhere in this prospectus. Overview We are a medical services company that focuses on delivering laser vision correction surgical procedures to consumers. We were incorporated on March 21, 2001 as LASIK America, Inc. In October 1995 and in March 1996, the United States Food and Drug Administration approved the use of excimer lasers manufactured by Summit Technology, Inc. and VISX, Inc., to treat low to moderate nearsightedness. In May, 2001, we opened our first excimer laser center in Albuquerque, New Mexico. We perform laser vision correction surgery procedures through affiliated and employed physicians in our New Mexico Center Office. We provide our ophthalmologists and optometrists with state-of-the-art equipment and facilities as well as support services necessary to perform vision correction procedures. To date, the supply of our excimer laser and related equipment has come through agreements that we have entered into with DVI Financial, Inc., Bausch & Lomb, Inc., and a patent licenses with VISX, Incorporated. In the event that we would not be able to obtain additional excimer lasers and related equipment from these providers, we believe that other satisfactory sources of supply are available now that the FDA has approved additional manufacturers of excimer lasers. 15 The following table sets forth, for the period March 21, 2001 (inception) through July 31, 2001, operating information expressed as a percentage of revenue. The results of operations data for the period March 21, 2001 (inception) through July 31, 2001 is not necessarily indicative of the results to be expected for future periods. March 21, 2001 (inception) through July 31, 2001 ------------- Net revenues........................... 100.0% Cost of revenues....................... 43.1% Gross margin........................... 56.9% General and administrative expense..... 132.2% Compensation expense related to common stock........................ 6,711.3% Depreciation expense................... 8.1% Total operating expenses............... 6851.6% Loss from Operations................... 6794.7% Interest Expense....................... 2.1% Net (loss)............................ 6,796.8% Results of operations Revenues Revenues from inception at March 21, 2001 to July 31, 2001 totaled $184,040. Total revenue is predicated on the number of procedures of laser vision correction we performed during the period. Due to the fact that our operations in performing laser vision correction surgery did not begin until May 2001, the number of procedures performed during the period from inception to July 31, 2001, we believe to be below what we anticipate will be performed during subsequent periods. Cost of revenues Cost of revenues consists of doctor fees, royalty fees and medical supplies. The total cost of revenue from inception to July 31, 2001 was $79,353. As a percentage of revenue, cost of revenue equaled 43.1% of total revenue during the period. General and administrative expenses General and administrative expenses consist primarily of salaries, wages and related costs for general corporate functions. General and administrative expenses from inception to July 31, 2001 totaled $243,369. As a percentage of revenue, general and administrative expenses equaled 132.2% of total revenue. We believe that this current percentage is high during this 16 period as a result of our accounting, legal and other fees for professional services incurred during our formation and start-up process. Compensation expense related to common stock Compensation expense of $12,351,387 related to common stock is the result of applying the anticipated initial public offering price of $6.00 per share to the shares issued upon our formation and common stock sold in a small private placement since our inception on March 21, 2001. Depreciation Depreciation expense amounted to $14,884 from the depreciation of capital items acquired for use in our operations. Interest expense Interest expense of $3,884 results from our financing costs of some of our capital equipment. Net loss Our net loss for the period March 21, 2001 (inception) through July 31, 2001 was $12,508,837. This net loss is primarily due to the $12,351,387 recognized as compensation expense related to common stock for shares issued to employees and sold to individuals since our inception and prior to the anticipated sale of the units in this offering. Liquidity and capital resources Since our inception, we have financed our operations through revenues and capital raised through the sale of our common stock. As of July 31, 2001 we had a cash balance of $19. Cash flows used in operating activities was $54,778 for the period March 21, 2001 (inception) through July 31, 2001. Net cash used in investing activities was $14,341 during the same period. Net cash flows provided by financing activities of $69,138 results from the sale of our common stock in conjunction with our formation. Recently issued accounting standards We believe that recently issued financial standards will not have a significant impact on our results of operations, financial position, or cash flows. 17 Business Overview LASIK America, Inc. provides laser vision correction procedures to individuals, at our New Mexico Center Office in Albuquerque, New Mexico. Our ophthalmologist, and those with which we are affiliated, provide these services using state-of-the-art excimer laser technology. We opened our first LASIK America center in Albuquerque, New Mexico in May 2001. Corporate background We were incorporated in Nevada on March 21, 2001 as LASIK America, Inc., and since that time have been providing laser vision correction services using the VISX, Incorporated excimer laser. Our strategy Our goal is to be a leading provider of laser vision correction procedures. In order to achieve this goal, we will implement the following strategies: o Expand our geographic presence by opening additional centers; o Equip our centers with state-of-the-art medical technologies; o Recruit, employ and affiliate talented ophthalmologists and optometrists and to capitalize on these doctors' relationships within their local communities; and o Increase our marketing and sales efforts to further penetrate our target markets. Our industry The laser vision correction industry has experienced dramatic growth during the past five years. Since 1995, approximately 2.25 million Americans have had refractive surgery, including more than 1.5 million who have had LASIK surgery. The American Society of Cataract and Refractive Surgery has forecasted that in 2001, approximately 1.8 million LASIK procedures, or 900,000 patients will have LASIK eye surgery. The growth trend in LASIK surgical procedures during the last five years has been dramatic, with approximately 170,000 procedures occurring in 1997, 440,000 in 1998, 870,000 in 1999 and 1,500,000 procedures in 2000. Total sales for the laser vision correction industry have been over $1.0 billion since approval of the excimer laser in the U.S. in October 1995. We believe that we can take advantage of this growing market through the opening of our New Mexico Center Office, and plan to selectively expand our ability to provide laser vision corrective surgery to new patients by expanding our services to other selected geographic markets. 18 Common refractive vision disorders Refractive vision disorders typically result from improper curvature of the cornea relative to the size and shape of the eye. If the curvature of the cornea is not precisely correct, it cannot properly focus the light passing through it onto the retina. The result is a blurred image. The three most common refractive vision disorders are: o Myopia, also known as nearsightedness--images focus in front of the retina, resulting in a blurred perception of distant objects; o Hyperopia, also known as farsightedness--images focus behind the retina, resulting in a blurred perception of near objects; o Astigmatism--images do not focus on any point due to the varying curvature of the eye along different axes. Corrective laser vision procedures Currently, eyeglasses and contact lenses are the most common and traditional means of correcting common vision disorders. Vision correction is achieved through the use of corrective lenses over the eye. Laser vision correction procedures are designed to reshape the outer layers of the eye to correct refractive vision disorders. Changing the curvature of the cornea with an excimer laser, eliminates or reduces the need for corrective lenses. We use the excimer laser in our centers which is approved to treat nearsightedness within parameters of the optical power of the human eye, and is approved to treat farsightedness and astigmatism within other parameters that measure the optical power of the eye. There are currently two outpatient procedures that we offer at our LASIK-America centers that use the excimer laser to correct common refractive vision disorders. One is laser in-situ keratomileusis, commonly known as LASIK and the other is photorefractive keratectomy, commonly known as PRK. Prior to either LASIK or PRK, an assessment is made of the correction required to program the excimer laser. Using a specially developed algorithm, the software of the excimer laser then calculates the optimal number of pulses needed to achieve the intended correction. The patient reclines in a chair, eyes focused on a fixed target, while the doctor positions the patient's cornea for the procedure. An eyelid holder is inserted to prevent blinking and topical anesthetic eye drops are applied. The excimer laser emits energy in a series of pulses, with each pulse lasting only several billionths of a second. High-energy ultraviolet light produced by the excimer laser creates a non-thermal process known as ablation, which removes tissue and reshapes the cornea without damaging adjacent tissue. The amount of tissue removed depends upon the amount of corneal reshaping required to correct the vision disorder. The typical procedure takes 15 to 30 minutes from set-up to completion, while the excimer laser is generally used for less than 40 seconds. The front surface of the eye is flattened when corrected for nearsightedness and steepened when corrected for farsightedness. In effect, the change made in the middle or periphery of the cornea is translated to the front surface of cornea and results 19 in vision correction. Following the procedure, a series of patient follow-up visits are scheduled in our center, with an ophthalmologist or optometrist, to monitor the corneal healing process, to verify that there are no complications and to test the amount of correction achieved by the laser vision correction procedure. LASIK. LASIK was approved for commercial use in the U.S. in 1999. Currently, the majority of laser vision correction procedures are LASIK, since it is believed that LASIK generally allows for: o More precise correction than PRK for higher levels of nearsightedness and farsightedness, with or without astigmatism; o Greater predictability of results; o Shorter patient recovery times and less discomfort; and o Decreased possibility of corneal regression. In the LASIK procedure, a small flap of the cornea is raised by use of a microkeratome, a tiny surgical blade with rapid oscillations. The laser is then applied to the surface of the cornea under the flap and the flap is put back in place. Generally, no bandage contact lens is required and the patient experiences minimal discomfort. Generally, LASIK has the advantage of a quicker recovery as compared to PRK. With LASIK, our experience has been that most patients see well enough to drive a car the next day and heal completely within one to three months. LASIK generally allows a doctor to treat both eyes in one visit. PRK. In PRK procedures, the doctor removes the thin layer of cells covering the outer surface of the cornea, by applying the excimer laser pulses directly to the surface of the cornea. Following the PRK procedure, a contact lens bandage is placed on the eye to protect it. The patient typically experiences discomfort for up to 24 hours and blurred vision for up to 72 hours until the epithelium, the outer surface of the cornea, heals. To alleviate discomfort and promote corneal healing, a doctor will typically prescribe topical pharmaceuticals. Although a patient usually experiences improvement in clarity of vision within a few days following the procedure, it usually takes one to three months for the full benefit of the PRK procedure to be realized. Patients usually have one eye treated per visit. Our laser vision correction center We operate one laser vision correction center in Albuquerque, New Mexico and operate it through affiliated and employed doctors. Our center is supported by our fully credentialed ophthalmologists and optometrists who perform pre-procedure evaluations, laser vision correction procedures, and post-procedure follow-ups. We strive to meet the needs of our patients as well as our ophthalmologists and optometrists. We recruit our doctors in several ways. Generally, we first identify and meet with doctors within the community to demonstrate our technical and marketing capabilities. We provide our ophthalmologists and optometrists with: 20 o STATE-OF-THE-ART EQUIPMENT AND FACILITIES. We provide our doctors with the facilities, equipment, support services and state-of-the-art laser technologies necessary to perform vision correction procedures. Our doctors focus on treating patients without the burden of meeting the financial, management, administrative, maintenance and regulatory requirements associated with establishing and operating a laser vision correction center. Our center has a fully-equipped laser procedure room, three ophthalmic examination rooms. A post-operative room, a vision screening room, a sales and business office and a patient waiting area. We are equipped with a VISX Star laser. We also have corneal topography instruments, ophthalmic examination equipment, a computer system, and standard office equipment. o A TRAINED TECHNICIAN AND SUPPORT STAFF. Staffing includes technicians who assist the doctors during the laser vision correction procedure. They also provide support services such as sterilization of surgical instruments. The excimer laser manufacturer and the microkeratome supplier, certify our technicians. The center also has a medical support director who supports our doctors, and assists in developing laser vision correction programs; We provide our patients with: o ACCESS TO HIGHLY CREDENTIALED OPHTHALMOLOGISTS AND OPTOMETRISTS. Our ophthalmologists have completed extensive FDA-mandated training and have met our qualification criteria. Our centers are designed to create a patient friendly environment and reduce any anxiety associated with laser vision correction procedures. We believe our centers have an aesthetically pleasing and comfortable waiting area and our center staff is focused on addressing the needs of each patient; o EDUCATIONAL CONSULTATIONS AND MATERIALS. The education process begins with our initial contact with the patient. Potential patients receive a free consultation focused on educating the patient on vision correction procedures, how the procedure corrects a specific refractive vision disorder and the results the patient should expect after the procedure. Patients are given written materials and can view a video of the procedure or witness an actual procedure during their initial visit. We believe that an educated patient has realistic expectations and should be more satisfied with procedure results; o REGULARLY SCHEDULED POST-PROCEDURE FOLLOW-UPS. We strive towards 100% patient satisfaction. We schedule post-procedure follow-ups with patients to monitor procedure results. In those instances when the desired correction is not achieved, the patient receives a follow up LASIK re-treatment procedure at no cost to the patient; 21 o AFFORDABLE FINANCING ALTERNATIVES. Laser vision correction procedures are elective and generally not reimbursable by third-party payers. We offer patients several financing alternatives and in some circumstances promotional discounts. We have multiple payment plans offered by an unaffiliated finance company. We also provide information regarding installment plans, insurance coverage and payment through employer-flexible benefit plans. In the majority of the procedures financed, we bear no credit risk. Our intellectual property rights We purchase or lease our excimer lasers and related laser equipment from manufacturers of the excimer laser. Our ability to use the excimer laser to perform laser vision correction procedures in our centers is derived from a license agreement, that has been filed as an exhibit to our registration statement, that governs the intellectual property rights covering the excimer laser technology. We are able to license from the manufacturer all necessary intellectual property rights associated with the laser and related equipment so long as we are in conformity with the terms of each license agreement and so long as we pay the royalty fee included as a part of each license agreement. Patent rights covering the excimer laser equipment we use in our laser vision correction procedures have been granted to the manufacturers of our excimer lasers. Our sales and marketing strategy We are developing and implementing direct marketing campaigns. We believe many of our competitors focus all of their resources on building affiliations with eye care providers, and rely on doctor relationships to produce their clients. Although our relationships with doctors is a key component of our overall strategy, we focus much of our resources directly on the consumer and attempt to create our own client relationships. Our "integrated marketing protocol," a consumer oriented marketing program for our services, was developed to focus our LASIK America staff on existing and prospective clients. Our laser vision correction surgical procedures currently cost approximately $2,390 for both eyes. LASIK America-employed doctors deliver our services and are paid a fixed per diem salary with no additional fees. LASIK America-affiliated ophthalmologists pay us a facility fee for each eye they perform surgery on at our center. They collect the entire fee from each patient. Competition The market for laser vision correction surgery is subject to intense competition. We compete with other entities, including refractive laser center companies, hospitals, individual doctors, other surgery and laser centers and manufacturers of laser equipment in offering such services and access to related equipment. In addition, the laser vision correction procedures provided at our centers compete with more traditional non-surgical treatments for refractive conditions including eyeglasses and contact lenses. Eye care professionals interested in deploying excimer laser technology have formed commercial enterprises in order to support the capital requirements 22 for acquiring the lasers and other necessary equipment. The industry today remains highly fragmented, with most procedures performed by independent physician groups. There are also several national laser vision correction companies. In addition, there are several eye care companies that feature access to laser vision correction and other refractive surgery services as an increasingly important component of their ophthalmic practice development activities. Our laser vision correction centers compete on the basis of quality of patient care, reputation and price. Our principal corporate competitors in the market for laser vision correction and other refractive surgery include: o TLC The Laser Center, Inc.; o Laser Vision Centers, Inc.; o ClearVision Laser Centers, Ltd.; o LCA-Vision Inc.; o NovaMed EyeCare, Inc.; and o ARIS Vision, Inc. The bases for competition in this market are: o systems; o pricing; o strength of delivery network; o strength of operational systems; o the degree of cost efficiencies and surgeries; o marketing strength; o information technology systems; o managed care expertise; o patient access; and o quality assessment programs. Many of our current and potential competitors have significantly greater financial and human resources than we currently have, and as a result, we may be at a competitive disadvantage to these current and potential competitors even though we believe that we can successfully compete on the basis of our marketing efforts, quality of patient care, our reputation and the price of our services. Suppliers of conventional vision correction, which includes eyeglasses and contact lenses, such as optometric chains, may also compete with us either by marketing alternatives to laser vision correction or other refractive surgery procedures or by purchasing excimer lasers and offering refractive surgery to their customers. 23 Government regulation As a participant in the health care industry, our operations and the operations of our affiliated ophthalmologists and optometrists are subject to extensive and increasing regulation by governmental entities at the Federal, state and local levels. Many of these laws and regulations are subject to varying interpretations. We believe courts and regulatory authorities have generally provided little clarification. Moreover, state and local laws and interpretations vary from jurisdiction to jurisdiction. As a result, we may not always be able to accurately predict interpretations of applicable law. As a result, some of our activities, or the activities of our affiliated providers, could be challenged. The regulatory environment in which we and our affiliated providers operate, may change significantly in the future. In response to new or revised laws, regulations or interpretations, we could be required to: o revise the structure of our legal arrangements or the structure of our fees; o incur substantial legal fees, fines or other costs; or o curtail our business activities, reducing the potential profit to us of some of our legal arrangements. Any of these outcomes may have a material adverse effect on our business, financial condition and results of operations. The following is a summary of some of the health care regulatory issues affecting us, our affiliated eye care providers and our respective operations. Federal Law ANTI-KICKBACK STATUTE. The U.S. Federal anti-kickback statute prohibits the knowing and willful solicitation, receipt, offer or payment of any direct or indirect remuneration in return for the referral of patients or the ordering or purchasing of items or services payable under Medicare, Medicaid or other federal health care programs. Violations of this statute may result in criminal penalties, including imprisonment or criminal fines of up to $25,000 per violation, civil penalties of up to $50,000 per violation, and exclusion from federal programs including Medicare or Medicaid. SELF-REFERRAL LAW. Subject to limited exceptions, the Federal self-referral law, known as the "Stark Law," prohibits physicians and optometrists from referring their Medicare or Medicaid patients for the provision of "designated health services" to any entity with which they or their immediate family members have a financial relationship. "Financial relationships" include both compensation and ownership relationships. "Designated health services" include clinical laboratory services, radiology and ultrasound services, durable medical equipment and supplies, and prosthetics, orthotics and prosthetic devices, as well as seven other categories of services. We do not provide "designated health services." Our affiliated providers, however, do provide limited categories of designated health services, specifically, ultrasound services, such as A-scans and B-scans, and prosthetic devices, such as eyeglasses and contact lenses furnished to patients following cataract surgery. 24 Violating the Stark Law may result in denial of payment for the designated health services performed. This may also result in: o civil fines of up to $15,000 for each service provided in connection with a prohibited referral, o a fine of up to $100,000 for participation in a circumvention scheme, and o exclusion from the Medicare, Medicaid and other Federal health care programs. The Stark Law is a strict liability statute. Any referral made where a financial relationship exists that fails to meet an exception constitutes a violation of the law. To the extent that our affiliated professional entities provide designated health services to Medicare and Medicaid beneficiaries, or make or receive Medicare or Medicaid referrals for such services, the Stark Law could be implicated. State law ANTI-KICKBACK LAWS. In addition to the Federal anti-kickback law, a number of states have enacted laws, which prohibit the payment for referrals and other types of anti-kickback arrangements. These state laws typically apply to all patients regardless of their source of payment. SELF-REFERRAL LAWS. In addition to the Federal Stark Law, a number of states have enacted laws that require disclosure of or prohibit referrals by health care providers to entities in which the providers have an investment interest or compensation relationship. In some states, those restrictions apply regardless of the patient's source of payment. CORPORATE PRACTICE OF MEDICINE LAWS. A number of states have enacted laws that prohibit the corporate practice of medicine. Those laws are designed to prevent interference in the medical decision-making process by anyone who is not a licensed physician. Many states have similar restrictions in connection with the practice of optometry. Application of the corporate practice of medicine prohibition varies from state-to-state. While some states may allow a corporation to exercise significant management responsibilities over the day-to-day operation of a physician or optometric practice, other states may restrict or prohibit various activities. FEE-SPLITTING LAWS. The laws of some states prohibit providers from dividing with anyone, other than providers who are part of the same group practice, any fee, commission, rebate or other form of compensation for any services not actually and personally rendered. Penalties for violating these fee-splitting statutes or regulations may include revocation, suspension or probation of a provider's license, or other disciplinary action. If we expand into a state with different or more restrictive laws, we may need to amend or restrict some of our operations in order to ensure compliance with applicable state laws, rules and regulations. FACILITY LICENSURE AND CERTIFICATE OF NEED. We may be required to obtain licenses from the state departments of health in states where we open or acquire 25 eye surgery and laser centers. Some states require a Certificate of Need, or CON, prior to the construction or modification of an ambulatory surgery center, such as our eye surgery and laser centers, or the purchase of medical equipment in excess of an amount set by the state. Excimer laser regulation Medical devices, such as the excimer lasers used in our eye surgery and laser centers, are subject to regulation by the U.S. Food and Drug Administration. Medical devices may not be marketed for commercial sale in the U.S. until the FDA grants pre-market approval for the device. The FDA has not approved the use of an excimer laser to treat both eyes on the same day, called a bilateral treatment. The FDA has stated that it considers the use of the excimer laser for bilateral treatment to be a practice of medicine decision, which the FDA is not authorized to regulate. Physicians, including our affiliated physicians, widely perform bilateral treatment as an exercise of professional judgment in connection with the practice of medicine. Failure to comply with applicable FDA requirements could subject us, our affiliated providers or laser manufacturers to enforcement action, product seizures, recalls, withdrawal of approvals and civil and criminal penalties. Failure to comply with regulatory requirements, or any adverse regulatory action, could result in a limitation on or prohibition of our use of the excimer laser. The marketing and promotion of laser vision correction surgical procedures in the U.S. is regulated by the FDA and the Federal Trade Commission. The FDA and FTC have released a joint communique on the requirements for marketing these procedures in compliance with the laws administered by both agencies. The FTC staff also issued more detailed staff guidance on the marketing and promotion of these procedures and has been monitoring marketing activities in this area through a non-public inquiry to identify areas that may require further FTC attention. Although the FDA does not regulate surgeons' use of excimer lasers, the FDA actively enforces regulations prohibiting the marketing of products for non-indicated uses and conducts periodic inspections of manufacturers to determine compliance with good manufacturing practice regulations. We believe that we conduct our operations in compliance with these laws and regulations. Insurance We believe that the insurance coverage for our business is generally in accordance with industry standards, including adequate coverage for potential premises liability and malpractice insurance for our employed doctors. We believe our insurance coverage is adequate in light of our business and the risks to which we are subject. We intend to obtain officers' and directors' liability insurance coverage prior to the completion of this offering. Employees As of July 31, 2001, we had 10 full-time and part-time employees. Of our total number of employees, seven are full-time and three are part-time. Of 26 this total, six employees function as medical or technical employees, two work in sales functions and one is administrative. We have no collective bargaining agreements covering any of our employees, and our management believes that relations with our employees is good. In addition to our employees, we have affiliate relationships with local ophthalmologists who provide medical services to our patients. As of July 31, 2001, we had one active member-affiliate for our New Mexico Center. Our facilities We lease our principal executive office and our medical facilities in Albuquerque, New Mexico under a three-month temporary lease arrangement. This temporary facility consists of a total of approximately 2,310 square feet, which we lease currently at $782.00 per month. We also have made arrangements for a permanent leased facility for our center, which is located adjacent to our temporary facility. Our proposed permanent facility consists of a 4,018 square feet office area that is the subject of a proposed initial lease term of three years expiring May 31, 2004, with two three-year renewal options. Although we have not yet fully executed the lease agreement covering our proposed permanent facility, we intend to have these arrangements in place in the near term. Base rent for our permanent facility will be $10.50 per square foot, increasing to $11.50 per square foot in the third year. This results in proposed monthly rental for our permanent facility of approximately $3,516 during the initial term of the lease. Our permanent facility will be adequate for our needs during at least the initial term. Legal proceedings We are not involved in any pending, or to our knowledge threatened, legal proceedings. Where you can find additional information about us We have filed with the Securities and Exchange Commission a registration statement on Form SB-2 under the Securities Act with respect to the securities offered by this prospectus. This prospectus, which forms a part of the registration statement, does not contain all of the information set forth in the registration statement and the accompanying exhibits and schedules. For further information with respect to us and the securities offered by this prospectus, reference is made to the registration statement and the accompanying exhibits and schedules. Statements contained in this prospectus as to the contents of any contract or other document filed as an exhibit to the registration statement are not necessarily complete and are qualified in their entirety by reference to the exhibits for a complete statement of their terms and conditions. The registration statement, including all amendments, exhibits and schedules, may be inspected without charge at the offices of the Securities and Exchange Commission at Judiciary Plaza, 450 Fifth Street NW, Washington, D.C. 20549 and the Commission's regional offices located at 7 World Trade Center, 13th Floor, New York, New York 10048 and 500 West Madison Street, Suite 1400, 27 Chicago, Illinois 60661. Copies of this material may be obtained at prescribed rates from the Public Reference Section of the Commission at 450 Fifth Street NW, Washington, DC. 20549. The public may obtain information on the operations of the Public Reference Room by calling the Commission at 1-800-SEC-0330. The Securities and Exchange Commission also maintains a Web site (http://www.sec.gov) through which the registration statement and other information can be retrieved. We have applied for quotation privileges for our securities on the Over-the-Counter Electronic Bulletin Board maintained by the NASD, and upon listing, investors can obtain information about us on Over-the-Counter Electronic Bulletin Board web site, (http://www.otcbb.com) Upon effectiveness of the registration statement, we will be subject to the reporting and other requirements of the Securities Exchange Act and intend to furnish our stockholders annual reports containing financial statements audited by our independent accountants and to make available quarterly reports containing unaudited financial statements for each of the first three quarters of each fiscal year. 28 Management Directors and officers Our executive officers, directors, and key employees and their ages as of September 6, 2001, are as follows. NAME AGE POSITION - --------------- ----- ------------------------------------- Dr. Howard P. Silverman...... 60 Chairman of the Board, Chief Executive Officer, Treasurer and Director Robert S. Helmer............. 46 Chief Operating Officer and Director Stuart S. Greenberg.......... 69 Director Steven D. De Vicenzi ........ 58 Director Dr. Howard P. Silverman is our founding shareholder, and has been our chief executive officer, chairman of the board, treasurer and a director, since our inception. He has been involved in various companies developing products and methods of delivery from the ophthalmic industry. Such companies include Precision Contract Lens Labs, Inc., Diversified Health Industries, Inc., Hydro Optics, Inc., Staar Surgical Company and Vision Science, Inc. From 1991 until the date we were incorporated, Dr. Silverman has been actively involved in a private consulting business designed to address the capital and corporate structural needs of companies in the ophthalmic and vision correction industries. In addition, from 1994 to 1997, Dr. Silverman served as an investment banking professional at Rickel & Associates, in New York, New York. Robert S. Helmer has been our chief operating officer in our Albuquerque, New Mexico center since we began operations in May, 2001. Prior to joining us in that capacity, Mr. Helmer served as the clinical support manager from October, 1998 to April, 2001, for TrueVision International, Inc., another company that performed eye vision corrective surgical procedures in Albuquerque, New Mexico. Mr. Helmer is a graduate physician and surgical assistant with 25 years of medical experience in emergency medicine, laser medicine, dermatology, cosmetic surgery and hair transplant surgery. From May 1998 until October, 1998, Mr. Helmer was a director and the president of the International College of Skin-Care Specialists. From October 1991 to October 1995, Mr. Helmer was a surgical assistant with Qualified Emergency Specialists, Inc., in Cincinnati, 29 Ohio, and from February 1991 to December 1991 was a surgical assistant and electrologist for Dermatology Associates of Atlanta, Georgia. Mr. Helmer has been a certified ophthalmic laser technician since September 1998 and a certified microkeratome technician since June 1999. Mr. Helmer received his associate of applied science degrees as a physician's assistant and surgical assistant in 1974 from the Cincinnati Technical College. He is a member of the American Academy of Physicians Assistants. Stuart S. Greenberg became one of our directors in May, 2001. Mr. Greenberg has worked with a number of leading investment banking and securities firms for over 35 years, having entered the field in 1960 with Merrill Lynch. From March 2001 to the present, Mr. Greenberg has served as the managing director of the investment banking division of West America Securities Corp., located in Westlake Village, California. From March 1999 to February 2001, Mr. Greenberg was the managing director of R.H. Investment Corp., an investment banking firm located in Los Angeles, California. From March 1992 to April 1996, he served in the capacities of chairman of the board and the chief executive officer of Baraban Securities. During a portion of that same time frame, Mr. Greenberg also functioned as the chairman of the board and chief executive officer of M.A. Investment Corp. out of Los Angeles, California. Mr. Greenberg has experience as branch manager, regional sales manager, as well as national sales manager during his tenure in the securities and brokerage industry. He received his bachelors degree from the City College of New York and a banking certification from the American Banking Institute of Banking in New York, New York. Steven Lee De Vincenzi became one of our directors in May, 2001. From March 2000 to the present time, Mr. De Vincenzi has served as a senior vice president of sales and marketing with Medpay, WebCVO and HealthCap. There, he is responsible for sales, marketing and business development for three pre-public offering companies that provide internet services to medical solution companies. From October 1992 to February 2000, Mr. De Vincenzi served as the president and chief operating officer of Interlink Rehab Services of California. In that position, Mr. De Vincenzi was responsible for all operations, business development and marketing for his company, which contracted for therapy services to 35 nursing facilities and outpatient clinics. Between May, 1991 and October, 1992, Mr. De Vincenzi was the vice president--western region for Monroe Systems for Business. There he had full profit and loss responsibility for sales, service and the administration of 40 branch offices in 13 Western states. Mr. De Vincenzi received his bachelor of science degree in marketing and his masters in business administration in marketing and finance from California State University in Long Beach, California. Directors' compensation Our non-employee directors receive reimbursement for their out-of-pocket expenses for attendance at each meeting of the board of directors or any committee of the board of directors. We anticipate that our directors will meet at least twice each year. No directors' fees are paid to our non-employee directors. Board composition Our board of directors consists of at least three members who each serve as directors for one-year terms. Terms for each of our directors expire at 30 the annual meeting next ensuing. There are no family relationships among any of our directors, officers or key employees. Each director holds office until their successor is duly elected and qualified. Vacancies in the office of any director may be filled by a majority vote of the directors then in office. Both of our outside directors will serve as members of both committees. Our president and chief executive officer is appointed by our board of directors, and all of our other executive officers are appointed by the president and chief executive officer. We have agreed that for five years from the completion of this offering, the representative of the underwriters may designate one person for election to our board of directors. If this election is not exercised, the representative may designate one person to attend all meetings of our board of directors. If the representative chooses to designate a person to attend our directors' meetings, we have agreed to reimburse that person for out-of-pocket expenses in connection with their attendance. Committees of the board Upon completion of this offering, the board of directors will establish an audit and compensation committee. The committee will: o recommend to the entire board of directors the independent public accountants to be engaged by us, o review the plan and scope of our annual audit, o review our internal controls and financial management policies with our independent public accountants; o review all related party transactions; o will determine the compensation and benefits to be paid to our officers and directors; o will recommend the adoption of a stock option plan; o will approve the grant of options under any stock option plan that we may adopt; and o will establish and review general policies relating to compensation and benefits of our employees. Executive compensation The following table sets forth the total compensation paid to our chief executive officer, Howard P. Silverman from our inception on March 21, 2001 to July 31, 2001, the end of our most current fiscal year. 31 Summary compensation table Annual Compensation Other compensation ------------ ------------------- Salary($) Bonus($) Other annual All other 2001 2001 compensation compensation ---- ---- ------------ ------------ Name and position - ----------------- Howard P. Silverman, chief executive officer.......... -0- -0- -0- -0- The aggregate compensation paid or delivered to all persons who served in the capacity of a director or executive officer during the period from inception (March 21, 2001) to July 31, 2001, 4 persons, was $939,152. Of this total, $19,152 was paid as salary and the balance was delivered to the officers and directors as a group, in the form of 150,000 shares of our common stock, valued at the proposed public offering price of our shares of common stock in this offering and services contributed by the chief executive officer. These contributed services are valued at $20,000 during the period. Option grants from inception(1) to the fiscal year ended July 31, 2001 Percent of total options(1) --------------------------- Number of Securities Granted to Underlying options employees in Exercise Expiration Granted fiscal year Price ($/sh) Date(2) ------- ----------- ------------ ------- 2001 2001 ---- ---- Name and position - ----------------- Howard P. Silverman, chief executive officer.....125,000 125,000 $7.20/share - -------------------------------- (1) This table includes 125,000 redeemable common stock purchase warrants granted to Howard P. Silverman, our chief executive officer, on August 24, 2001, which warrants are being registered for resale in this prospectus, and which warrants are included for resale with the 125,000 units offered by Dr. Silverman as selling shareholder. Through the date of this prospectus, we have not issued any options to purchase our securities. This table includes only warrants to purchase our securities. (2) These warrants expire five (5) years after the effective date of this registration statement. Limitation of liability and indemnification of directors and officers Our articles of incorporation and our by-laws contain provisions that eliminate the personal liability of our directors to us or our stockholders for 32 monetary damages for breach of their fiduciary duty as a director to the fullest extent permitted by the Nevada General Corporation Law, except for liability for: o any breach of their duty of loyalty to us or our stockholders; o acts or omissions not in good faith or which involve intentional misconduct; o misconduct or a knowing violation of law; o unlawful payments of dividends or unlawful stock repurchases or redemptions; o any act or omission occurring prior to our incorporation; and o any transaction from which the director derived an improper personal benefit. Our articles of incorporation and by-laws also contain provisions that require us to indemnify our directors and permits us to indemnify our incorporators, directors and officers to the fullest extent permitted by Nevada law, including circumstances where indemnification would be discretionary. Insofar as indemnification for liabilities arising under the securities Act may be permitted to directors, officers, and persons controlling us in connection with the foregoing provisions, or otherwise, we have been advised that in the opinion of the Securities and Exchange Commission, such indemnification is against public policy as expressed in the Securities Act, and is unenforceable. Certain transactions As partial consideration for the services rendered to us by Howard P. Silverman since our inception on March 21, 2001, on August 24, 2001, we granted to Dr. Silverman 125,000 redeemable common stock purchase warrants entitling him to purchase 125,000 shares of our common stock at $7.20 per share. These warrants are exercisable commencing six months from the effective date of this registration statement and have a five year term from the date of issuance. As further consideration for the services rendered to us by Dr. Silverman, we have agreed to register the 125,000 redeemable common stock purchase warrants and the 125,000 shares of our common stock underlying those warrants, for resale, on the first registration statement we file with the United States Securities and Exchange Commission pursuant to Section 5 of the Securities Act of 1933. Dr. Silverman's 125,000 redeemable common stock purchase warrants and the 125,000 underlying shares of our common stock, are being registered for resale pursuant to this registration statement, of which this prospectus forms a part. Principal and selling stockholders The following table sets forth information regarding the beneficial ownership of our common stock as of August 31, 2001, and as adjusted to reflect the sales of the units offered hereby. The information in this table provides the beneficial ownership for: o each person known by us to be the beneficial owner of more than 5% of the outstanding shares of our common stock; 33 o each of our directors and executive officers; o our executive officers and directors as a group; and o the selling shareholder. Beneficial ownership is determined in accordance with the rules of the Securities and Exchange Commission and generally includes voting or investment power with respect to securities. Except as indicated, we believe each person possesses sole voting and investment power with respect to all of the shares of common stock owned by such person, subject to community property laws where applicable. In computing the number of shares beneficially owned by a person and the percentage ownership of that person, shares of common stock subject to options or warrants held by that person that are currently exercisable or exercisable within 60 days are deemed outstanding. Such shares, however, are not deemed outstanding for the purposes of computing the percentage ownership of any other person. The number of shares beneficially owned by a person and the percentage ownership of that person includes shares of our common stock issuable upon exercise of warrants held by that person, but not those held by any other persons, that are currently exercisable or exercisable within 60 days from the date of this prospectus. Shares of our common stock registered for resale under this prospectus will constitute approximately 21.9% of our issued and outstanding common stock after giving effect to the common stock registered for resale hereunder. NUMBER OF SHARES PERCENT BENEFICIALLY OWNED NAMES AND ADDRESS BENEFICIALLY BEFORE NUMBER OF SHARES AFTER OF BENEFICIAL OWNER OWNED OFFERING(2) OFFERED OFFERING(2) - ------------------------ ------------- ------------ ---------- ------------- Howard P. Silverman(3) 1,090,000(1) 52.4% 125,000(1) 38.5% Robert S. Helmer(3) 150,000 7.2% -0- 6.0% Stuart S. Greenberg(3) -0- -0- -0- -0- Steven D. De Vicenzi(3) -0- -0- -0- -0- All directors and executive officers as a group (4 persons).... 1,240,000 59.6% 125,000 44.5% - ------------------------ (1) Excludes 125,000 redeemable common stock purchase warrants for the purchase of 125,000 shares of common stock held by Howard P. Silverman, which are being offered for resale as units along with 125,000 shares of common stock held by Dr. Silverman as a selling shareholder. Such warrants are not exercisable until six months after the date of this prospectus. (2) Based on an aggregate of 2,082,043 shares of common stock issued and outstanding as of August 31, 2001. The percentages after the offering are based on 2,507,043 shares of common stock outstanding after the offering. 34 (3) Unless otherwise noted, the address of these beneficial owners is 6646 Indian School Road, N.E., Albuquerque, New Mexico 87110. Description of securities General Our authorized capital stock consists of (a) 25,000,000 shares of common stock, $.001 par value per share and (b) 100,000 shares of preferred stock, $.001 par value per share, the rights and preferences of which may be established from time to time by our board of directors. As of August 31, 2001, there were 2,082,043 shares of our common stock issued and outstanding, and no shares of our preferred stock outstanding. The description of our securities are summaries and do not contain all the information that may be important to you. For more complete information, you should read our certificate of incorporation and all amendments that are all filed as exhibits to the registration statement of which this prospectus forms a part. Common stock Holders of our common stock are entitled to one vote for each share on all matters submitted to a vote of stockholders and there are no cumulative voting rights. Accordingly, holders of a majority of the shares of our common stock entitled to vote in any election of directors may elect all of the directors standing for election. Holders of common stock are entitled to receive ratably such dividends, if any, as may be declared by our board of directors out of funds legally available, subject to any preferential dividend rights of any outstanding shares of preferred stock. Upon the liquidation, dissolution or winding up of us, holders of our common stock are entitled to share in our assets remaining after the payment of all liabilities and liquidation preferences on any outstanding shares of preferred stock. Holders of our common stock have no: o preemptive, o subscription, o redemption or o conversion rights, and there are no redemption or sinking fund provisions applicable to our common stock. All outstanding shares of common stock are, and the shares offered by us as units in this offering will be, when issued and paid for, duly authorized, validly issued, fully paid and non-assessable. The rights, preferences and privileges of holders of our common stock are subject to, and may be adversely affected by, the rights of the holders of shares of any series of preferred stock that we may designate and issue in the future. 35 Preferred stock Our board of directors has the authority, without stockholder approval, to issue up to an aggregate of 100,000 shares of preferred stock, in one or more series. The board may fix the rights, preferences, privileges and restrictions of the shares of each series, including dividend rights, conversion rights, voting rights, terms of redemption and liquidation preferences, and to fix the number of shares constituting any series and the designations of these series. These shares may have rights senior to our common stock. The issuance of preferred stock may have the effect of delaying or preventing a change of control of us. The issuance of preferred stock could decrease the amount of earnings and assets available for distribution to the holders of our common stock or could adversely affect the rights and powers, including voting rights, of the holders of our common stock. We have no present plans to issue any shares of preferred stock. Redeemable common stock purchase warrants Generally. Each warrant entitles the registered holder to purchase, at any time commencing six months after the date of this prospectus until 60 months after the date of this prospectus, one share of common stock at a price equal to $7.20. As of August 31, 2001, we have issued 125,000 redeemable common stock purchase warrants, all of which were issued on August 24, 2001 to our chief executive officer, Howard P. Silverman. Dr. Silverman's redeemable common stock purchase warrants are not exercisable until the date when the warrants we intend to issue to the public as registered under this prospectus become exercisable. Redemption provisions. Commencing six months after the date of this prospectus, we may redeem the warrants, in whole but not in part, at $.10 per warrant on 30 days' prior written notice. The warrants may only be redeemed if the average closing sale price of our common stock as reported on the Over-the-Counter Electronic Bulletin Board equals or exceeds $9.00 for any 20 consecutive trading days. Since we have the right to redeem the warrants under these circumstances, this may impact a decision as to if and when to exercise the warrants. If we decide to redeem the warrants, holders will lose their rights to purchase the underlying shares of common stock unless the warrant is exercised before we redeem them. The holder of any warrant may exercise the warrant by surrendering the certificate representing the warrant to the warrant agent, with the subscription form properly completed and executed, together with payment of the exercise price. No fractional shares will be issued upon the exercise of the warrants. The exercise price of the warrants bears no relationship to any objective criteria of value and should in no event be regarded as an indication of any future market price of the securities offered in this offering. Adjustments. The exercise price of the warrants and the number of shares of common stock that may be issued upon the exercise of the warrants will be adjusted upon the occurrence of specific events, including stock dividends, stock splits, combinations or reclassifications of the common stock. Additionally, an adjustment would be made in the case of a reclassification or exchange of common stock, consolidation or merger of us with or into another corporation, other than a consolidation or merger in which we are the surviving 36 corporation, or sale of all or substantially all of our assets, in order to enable warrant holders to acquire the kind and number of shares of stock or other securities or property receivable in such event by a holder of the number of the number of shares of common stock that might otherwise have been purchased upon the exercise of the warrant. Transfer, exchange and exercise. The warrants are in registered form and may be presented to the warrant agent for transfer, exchange or exercise at any time on or prior to their expiration date, at which time they will be void and have no value. The warrants may not be exercised until six months after the date of this prospectus. If a market for the warrants develops, the holder may sell the warrants instead of exercising them. There can be no assurance, however, that a market for the warrants will develop or, if developed, will continue. Modification of warrants. We and the warrant agent may make such modifications to the warrants as we deem necessary and desirable that do not adversely affect the interests of the warrant holders. We may, in our sole discretion, lower the exercise price of the warrants for a period of no less than 30 days on not less than 30 days' prior written notice to the warrant holders and the representative. Modification of the number of securities purchasable upon the exercise of any warrant, the exercise price, other than as provided in the preceding sentence, and the expiration date with respect to any warrant requires the consent of at least two-thirds of the warrant holders. The redeemable common stock purchase warrants included in the units offered by this prospectus are not exercisable unless, at the time of exercise, we have a current prospectus covering the shares of common stock issuable upon exercise of the warrants, and the shares have been registered, qualified or deemed to be exempt under the securities laws of the state of residence of the exercising holder of the warrants. Although we have agreed to use our best efforts to keep a registration statement covering the shares of common stock issuable upon the exercise of the warrants effective for the term of the warrants, if we fail to do so for any reason, the warrants may be deprived of value. The common stock and warrants included in the units offered by this prospectus are detachable and separately transferable immediately following completion of maximum amount of this offering. Purchasers may buy warrants in the aftermarket or may move to jurisdictions in which the shares underlying the warrants are not so registered or qualified during the period that the warrants are exercisable. In that event, we would be unable to issue shares to those holders desiring to exercise their warrants, and these holders would have no choice but to attempt to sell the warrants in a jurisdiction where a sale is permissible or allow the warrants to expire unexercised. The representative's warrants We have agreed to issue to the representative and/or its designees, at the closing of this offering, for a total of $42.50, 42,500 five year warrants exercisable to purchase an aggregate of 42,500 units, each unit consisting of one share of common stock and one redeemable common stock purchase warrant. The representative's warrants are exercisable at any time during a period of four years commencing at the beginning of the second year after their issuance at an 37 exercise price of $10.065 per unit. The units issuable upon exercise of the representative's warrants are identical to those offered to the public and the securities underlying the representatives warrants, including the common stock and the redeemable common stock purchase warrants are being registered in this offering. The representative's warrants contain anti-dilution provisions providing for adjustment of the number of securities issuable upon the exercise of the warrants under specific circumstances, including stock dividends, stock splits, mergers, acquisitions and recapitalizations. The holders of the representative's warrants will have no voting, dividend or other stockholder rights solely for being a holder of the warrants. For a period of five years after the completion of our initial public offering, the holders of the representative's warrants and/or the shares of common stock underlying the representative's warrants have piggyback registration rights covering the underlying shares and warrants, at our expense, except as to fees and expenses of the holders' counsel and selling commissions applicable to those units. In addition, for a five year period from the completion of our initial public offering, upon demand by the holders of at least a majority of the representative's warrants or of the underlying securities, the holders of the representative's warrants and of the underlying securities, have a right to demand a one time registration of the securities underlying the representative's warrants. The cost of these registrations are at our expense, except as to fees and expenses of the holders' counsel and selling commissions applicable to the warrants and the underlying securities. Transfer agent and registrar We intend to make application to appoint Corporate Stock Transfer, 3200 Cherry Creek Drive South, Suite 430, Denver, Colorado 80209 as our transfer agent, warrant agent, and registrar. The telephone and facsimile numbers for our proposed stock transfer agent are 303-282-4800 and 303-282-5800, respectively. Shares eligible for future sale Prior to this offering, there has been no public market for any of our securities and there can be no assurance that a significant public market for any of our securities will be developed or sustained after this offering. Sales of substantial amounts of our common stock in the public market after this offering, or the possibility of those sales occurring could adversely affect the prevailing market price for our securities and our ability to raise equity capital in the future. Upon completion of this offering, there will be 2,507,043 shares of our common stock outstanding. Including the 125,000 units offered on behalf of the selling shareholder, there will be 550,000 shares of common stock and 550,000 redeemable common stock purchase warrants being offered by this prospectus that will be freely tradable without restriction under the Securities Act, unless purchased by an affiliate of ours, as that term is defined under the rules and regulations of the Securities Act, which will be subject to the resale limitations of Rule 144 under the Securities Act. The remaining 1,957,043 shares of our common stock are considered "restricted securities" as defined in Rule 144. These shares were issued in private transactions and have not been registered under the Securities Act and 38 may not be sold unless registered under the Securities Act or sold under an exemption from registration, such as the exemption provided by Rule 144. In general, under Rule 144, beginning 90 days after the completion of this offering, a person, or persons whose shares are aggregated, who has beneficially owned restricted shares for at least one year, including the holding period of any prior owner who is not an affiliate of ours, would be entitled to sell within any three-month period, a number of shares that does not exceed the greater of: o one percent, or approximately 25,071 shares following this offering, of the number of shares of our common stock then outstanding; or o the average weekly trading volume of our common stock during the four calendar weeks preceding the sale. Sales under Rule 144 are also subject to manner of sale provisions, notice requirements and to the availability of current public information about us. Under Rule 144(k), a person who is not deemed to have been an affiliate of ours at any time during the 90 days preceding a sale, and who has beneficially owned the shares for at least two years, including the holding period of any prior owner who is not an affiliate of ours, would be entitled to sell those shares under Rule 144(k) without complying with the manner of sale, public information, volume limitation or notice provisions of Rule 144. We and all of our existing stockholders, except 125,000 shares of our common stock and 125,000 redeemable common stock purchase warrants that are included in this prospectus and are being registered on behalf of the selling shareholder, our executive officers and directors, have agreed that, for a period of 12 months from the completion of this offering, we and they will not, without the prior written consent of the representative of the underwriters: o offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase or otherwise transfer or dispose of, directly or indirectly, any shares of our common stock or any securities convertible into or exercisable or exchangeable for our common stock. Underwriting Subject to the terms and conditions of the underwriting agreement, the form of which is filed as an exhibit to the registration statement filed with the Commission of which this prospectus is a part, the underwriters named below, have agreed through West America Securities Corp. as the representative of the underwriters, to place as our agents, on a best efforts basis, the aggregate number of units set forth opposite their respective names. The underwriters, through the representative, have also agreed to offer to the public for resale on a best efforts basis, 125,000 units on behalf of the selling shareholder. No units offered for resale on behalf of the selling shareholder will be placed with investors until all 425,000 units offered directly by us are first placed by the underwriters. We will not receive any proceeds from the resale of our common stock by the selling shareholder. 39 UNDERWRITERS NUMBER OF UNITS - ------------ --------------- West America Securities Corp................................ 425,000 West America Securities Corp., for the selling shareholder............................... 125,000 ------- Total............................................... 550,000 ======= The underwriting agreement provides that the obligations of the several underwriters under that agreement depend on various conditions, including; o the absence of any material adverse change in our business; o the absence of any event that has materially disrupted or in the representative's opinion will in the immediate future materially adversely disrupt the financial markets; o the absence of our default under any of our agreements or contracts; o the continued truth of the statements made in this prospectus; o the absence of any event that in the representative's opinion that would make it inadvisable to proceed with this offering, and o the receipt of certificates, opinions and letters from us, our counsel and our independent public accountants. This section contains the material conditions upon which the underwriting agreement depends, although we direct you to the underwriting agreement, the form of which is filed in an exhibit to the registration statement, of which this prospectus forms a part for a complete list of the conditions of the underwriters' obligations. The underwriters are committed only to use their best efforts to place the units for sale to the public. In the event of a default by any of the underwriters, the best efforts undertaking of the non-defaulting underwriters may be increased or the underwriting agreement may be terminated. The underwriters will offer the units to the public, on a best efforts basis, at the public offering price set forth on the cover page of this prospectus. The underwriters may allow some dealers concessions of not more than $ per unit. The underwriters also may allow, and those dealers may re-allow, a concession of not more than $ per unit to some other dealers. The public offering price, concessions, and re-allowances may be changed after the completion of this offering. The representative of the underwriters has agreed to use its best efforts to place for resale to the public the 125,000 units offered by this prospectus on behalf of the selling shareholder. The terms of underwriting on behalf of the selling shareholder are the same as the terms of the underwriting on our behalf, except that the selling shareholder is responsible for the payment of all expense of the resale of the 125,000 units offered for resale, such as all discounts, commissions and the non-accountable 40 expense allowance applicable to the 125,000 units offered for resale by this prospectus. We have agreed to indemnify the underwriters and their controlling persons against some liabilities, as more fully set forth in the underwriting agreement, including liabilities under the Securities Act, and to contribute to payments the underwriters and their controlling persons may be required to make. We have also agreed to pay to the representative, a non-accountable expense allowance equal to three percent of the gross proceeds of this offering. We have also agreed to pay all expenses in connection with qualifying the securities under the laws of those states that the representative may designate, including fees and expenses of counsel retained for these purposes by the representative, and the costs and expenses in connection with qualifying the offering with the National Association of Securities Dealers, Inc. The representative of the underwriters has informed us that the underwriters do not expect sales of the units offered by this prospectus to be made to discretionary accounts to exceed five percent of the total number of units offered. We, and all of our existing stockholders, except the 125,000 units being offered for resale in this prospectus by the selling shareholder, our executive officers and directors, have agreed that, for a period of 12 months from the completion of this offering, we and they will not, without the prior written consent of the representative of the underwriters: o offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase or otherwise transfer or dispose of, directly or indirectly, any shares of our common stock or any securities convertible into or exercisable or exchangeable for our common stock. We have agreed to issue and sell to the representative of the underwriters and/or its designees, for nominal consideration, 42,500 five-year warrants to purchase in the aggregate, 42,500 units. The representative's warrants are exercisable on a cashless basis for a period of four years commencing one-year after the date of issuance at a price equal to $10.065 per unit. The representative's warrants contain anti-dilution provisions providing for adjustments of the exercise price and the number of shares issuable upon exercise, upon the occurrence of specific events, including stock dividends, stock splits, and recapitalizations. The representative's warrants contain demand and piggyback registration rights relating to the shares of common stock issuable upon exercise of these warrants. For the life of the representative's warrants, the representative will have the opportunity to profit from a rise in the market price of our shares of common stock. The representative's warrants are restricted from sale, transfer, assignment or hypothecation for the one year period from the date of this prospectus, except to officers or partners of the underwriters and members of the selling group and/or their officers or partners. We have agreed that for five years from the completion of this offering, the representative may designate one person for election to our board 41 of directors. In the event that the representative elects not to exercise this right, then it may designate one person to attend all meetings of our board of directors. The representative has not yet exercised this right to designate this person. We have agreed to reimburse the representative's designee for all out-of-pocket expenses incurred in connection with the designee's attendance at meetings of our board of directors. As a result of our agreements with the representative of the underwriters, the representative will continue to have influence over us following the completion of this offering. Prior to this offering, there has been no public market for any of our securities. The initial public offering price of the units offered by this prospectus and the terms of redeemable common stock purchase warrants will be determined by negotiations between the representative and us. Among the factors considered in determining the price include: o prevailing market conditions, o the history of and the prospects for the industry in which we compete, o an assessment of our management, o our prospects, and o our capital structure. The offering price does not necessarily bear any relationship to our assets, results of operations or net worth. There can be no assurance that an active trading market will develop for any of the securities offered by this prospectus, or that such securities will trade in the public market at or above the initial public offering price. The representative, on behalf of the underwriters, may engage in: o stabilizing transactions, o syndicate covering transactions; and o penalty bids. Stabilizing transactions permit bids to purchase the shares of common stock and/or warrants being offered so long as the stabilizing bids do not exceed a specified maximum. Syndicate covering transactions involve purchases of the shares of common stock or the redeemable common stock purchase warrants in the open market after the distribution has been completed in order to cover syndicate short positions. Penalty bids permit the representative to reclaim a selling concession from a syndicate member when the shares of common stock and warrants originally sold by the syndicate member are purchased in a syndicate covering transaction and penalty bids may cause the price of the shares of common stock to be higher than it would otherwise be in the absence of such transactions. These transactions may be commenced and may be discontinued at any time. In addition, the underwriters may engage in passive market making transactions in our 42 securities in accordance with Rule 103 of Regulation M. Neither we nor the underwriters make any representation or prediction as to the direction or magnitude of any effect that the transactions described above may have on the price of the securities offered by this prospectus. Certain persons participating in this offering may engage in transactions that stabilize, maintain or otherwise affect the price of our securities offered in this prospectus. These actions include purchasing the securities to cover some or all of a short position of any of the securities maintained by the representative and the imposition of penalty bids. Plan of distribution for selling shareholder We will not receive any proceeds from the resale of the 125,000 units offered for resale by the selling shareholder. The selling shareholder will be offering for resale up to 125,000 units. The representative has agreed to be named as statutory underwriters within the meaning of the Securities Act of 1933 in connection with the resales of these units and they will be acting as an underwriter in their resales of the units under this prospectus. The selling shareholder has, prior to any sales, agreed not to effect any offers or sales of our securities in any manner other than as specified in this prospectus and has agreed not to purchase or induce others to purchase any of our securities in violation of any applicable state and federal securities laws, rules, and regulations and the rules and regulations governing the Over-the-Counter Electronic Bulletin Board maintained by the NASD. We have agreed with the selling shareholder that we will prepare and file this registration statement and such amendments and supplements to the registration statement and the prospectus as may be necessary in accordance with the Securities Act of 1933 and the rules and regulations promulgated thereunder to keep it effective until the date as of which the selling shareholder has sold all of the 125,000 units offered by this prospectus. The selling shareholder is subject to the applicable provisions of the Exchange Act of 1934, including without limitations, Rule 10b-5 thereunder. Under applicable rules and regulations under the Exchange Act, any person engaged in a distribution of our securities stock may not simultaneously engage in market making activities with respect to such securities for a period beginning when such person becomes a distribution participant and ending upon such person's completion of participation in a distribution, including stabilization activities in our securities to effect covering transactions, to impose penalty bids, or to effect passive market making bids. In connection with the transactions in our common stock, we also will be subject to applicable provisions of the Exchange Act and the rules and regulations promulgated thereunder, including, without limitations, the rule set forth above. These restrictions may affect the marketability of the shares of our common stock and the redeemable common stock purchase warrants owned by the selling shareholder. The selling shareholder has advised us that, prior to the date of this prospectus, he has entered into a form of underwriting agreement that delineates the facts material to the resale of his 125,000 units through the best efforts 43 to be undertaken by the representative. The form of underwriting agreement, which has been attached as an exhibit to this registration statement, includes terms and provisions which are the same as the terms and provisions of the underwriting commitment made by the representative with respect to the 425,000 units offered by us to the public through this prospectus. The units have not been registered for resale by the selling shareholder under the securities laws of any state as of the date of this prospectus. Brokers or dealers effecting transactions in these securities should confirm the registration thereof under the securities laws of the states in which transactions occur or the existence of any exemption from registration. We expect that the selling shareholder will resell his units covered by this prospectus through the representative acting as placement agent on his hehalf, at an expected public offering price of $6.10 per unit, which consists of $6.00 per share of common stock and $.10 per redeemable common stock purchase warrant. We further expect that the units offered for resale by the selling shareholder will be placed for sale by the representative to the public only at such time as the 425,000 units offered by us have been placed to the public. The selling shareholder may effect the resale of his units by selling the securities to or through broker-dealers, and such broker-dealers may receive compensation in the form of concessions or commissions from the selling shareholder. To the extent that such broker-dealers receive concessions or commissions from the selling shareholder, they will be on the same terms of sale as the 425,000 units offered on our behalf. The selling shareholder and any broker-dealers that participate with the selling shareholder in the distribution of units may be deemed to be underwriters and commissions received by them and any profit on the resale of securities positioned by them might be deemed to be underwriting discounts and commissions under the Securities Act. There can be no assurance that the selling shareholder will sell any or all of the units being registered for resale under this prospectus. The selling shareholder will pay all commissions and his own expenses, if any, associated with the resale of his 125,000 units, other than the expenses associated with preparing this prospectus and the registration statement of which it is a part, which we have agreed to pay on behalf of the selling shareholder. Legal matters The validity of the units, the shares of common stock and the redeemable common stock purchase warrants being offered by this prospectus will be passed upon for us by Gregory Bartko, Esq., of the Law Offices of Gregory Bartko, Atlanta, Georgia, our legal counsel. Experts Our financial statements as of July 31, 2001 included in this prospectus have been so included in reliance on the report of Pannell Kerr Forster, Certified Public Accountants, A Professional Corporation, San Diego, California, independent auditors, given on the authority of such firm as experts in auditing and accounting. 44 Table of contents Page -------- Prospectus Summary.................... 2 Risk Factors.......................... 5 Cautionary Note Regarding Forward- Looking Statements.................. 10 Use Of Proceeds....................... 11 Dividend Policy....................... 12 Capitalization........................ 12 Dilution.............................. 13 Selected Financial Data............... 14 Management's Discussion And Analysis Of Financial Condition And Results Of Operations....................... 15 Business.............................. 18 Management............................ 29 Certain Transactions.................. 33 Principal and Selling Shareholder..... 33 Description Of Securities............. 34 Shares Eligible For Future Sale....... 38 Underwriting.......................... 39 Plan of Distribution for Selling Shareholder......................... 43 Legal Matters......................... 44 Experts............................... 44 Index To Financial Statements......... F-1 UNTIL , 2000, 25 DAYS AFTER THE DATE OF THIS PROSPECTUS, ALL DEALERS THAT BUY, SELL OR TRADE THE UNITS, WHETHER OR NOT PARTICIPATING IN THIS OFFERING, MAY BE REQUIRED TO DELIVER A PROSPECTUS. THIS DELIVERY REQUIREMENT IS IN ADDITION TO THE OBLIGATIONS OF DEALERS TO DELIVER A PROSPECTUS WHEN ACTING AS UNDERWRITERS AND WITH RESPECT TO THEIR UNSOLD ALLOTMENTS OR SUBSCRIPTIONS. 425,000 UNITS CONSISTING OF ONE SHARE OF COMMON STOCK AND ONE REDEEMABLE COMMON STOCK PURCHASE WARRANT. [LOGO] --------------------- PROSPECTUS --------------------- WEST AMERICA SECURITIES CORP. SEPTEMBER , 2001 45 LASIK AMERICA, INC. TABLE OF CONTENTS ----------------- INDEPENDENT AUDITOR'S REPORT F-2 FINANCIAL STATEMENTS Balance Sheet F-3 Statement of Operations F-4 Statement of Shareholders' Deficit F-5 Statement of Cash Flows F-6 - F-7 NOTES TO FINANCIAL STATEMENTS F-8 - F-14 F-1 INDEPENDENT AUDITOR'S REPORT To the Shareholders Lasik America, Inc. Albuquerque, New Mexico We have audited the balance sheet of Lasik America, Inc. (the "Company") as of July 31, 2001, and the related statements of operations, shareholders' deficit and cash flows for the period March 21, 2001 (inception) through July 31, 2001. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Lasik America, Inc. at July 31, 2001, and the results of its operations and its cash flows for the period March 21, 2001 (inception) through July 31, 2001, in conformity with accounting principles generally accepted in the United States of America. The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company has limited capital resources and a working capital deficit. These conditions raise substantial doubt about the Company's ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 1. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. San Diego, California PANNELL KERR FORSTER August 13, 2001 (except for Note 8 Certified Public Accountants as to which the date is August 24, 2001) A Professional Corporation F-2 LASIK AMERICA, INC. BALANCE SHEET July 31, 2001 ASSETS ------ Current assets: Cash $ 19 Accounts receivable 2,370 Other current assets 7,550 ----------------- Total current assets 9,939 ----------------- Property and equipment, net 219,773 ----------------- Total assets $ 229,712 ================= LIABILITIES AND SHAREHOLDERS' DEFICIT ------------------------------------- Current liabilities: Accounts payable $ 51,537 Patient deposits 11,105 Sales tax payable 12,554 Other liabilities 2,512 Current portion of long-term debt 110,263 ----------------- Total current liabilities 187,971 ----------------- Long-term debt 105,820 ----------------- Total liabilities 293,791 ---------------- Commitments (Note 4) Shareholders' deficit: Preferred stock, $.001 par value, 100,000 shares authorized; no shares issued and outstanding - Common stock, $.001 par value, 25,000,000 shares authorized; 2,082,043 to be issued 2,082 Additional paid-in capital 12,510,176 Deferred compensation (67,500) Accumulated deficit (12,508,837) ---------------- Total shareholders' deficit (64,079) ----------------- Total liabilities and shareholders' deficit $ 229,712 ================ The accompanying footnotes are an integral part of the financial statements. F-3 LASIK AMERICA, INC. STATEMENT OF OPERATIONS For the period March 21, 2001 (Inception) through July 31, 2001 Revenues: Patient Fees (net of discounts) $ 147,230 Facility Fees 36,810 ------------------- Total revenues 184,040 Costs and expenses: Cost of revenues 79,353 General and administrative 243,369 Compensation expense related to common stock 12,351,387 Depreciation 14,884 ------------------ Total costs and expenses 12,688,993 ------------------ Loss from operations (12,504,953) Other expense: Interest expense 3,884 ------------------ Net loss $ (12,508,837) ================== Basic and diluted net loss per share $ (6.01) ================== Shares used to compute basic and diluted net loss per share 2,082,043 ================== The accompanying footnotes are an integral part of the financial statements. F-4 LASIK AMERICA, INC. STATEMENT OF SHAREHOLDERS' DEFICIT For the period March 21, 2001 (Inception) through July 31, 2001 Common Stock ------------------------ Additional Deferred Accumulated Shares Amount Paid in Capital Compensation Deficit Total ----------- ---------- --------------- ------------ ------------ ------------ Balance, March 21, 2001 (Inception) - $ - $ - $ - $ - $ - Common stock for cash 1,865,000 1,865 11,188,135 - - 11,190,000 Common stock to employees 185,000 185 1,109,815 (90,000) - 1,020,000 Common stock for cash 32,043 32 192,226 - - 192,258 Contributed services of executive officer - - 20,000 - - 20,000 Amortization of deferred compensation - - - 22,500 - 22,500 Net loss - - - - (12,508,837) (12,508,837) ---------- --------- ------------ ----------- ------------ ----------- Balance, July 31, 2001 2,082,043 $ 2,082 $ 12,510,176 $ (67,500) $(12,508,837) $ (64,079) ========= ========= ============ =========== ============ ===========
The accompanying footnotes are an integral part of the financial statements. F-5 LASIK AMERICA, INC. STATEMENT OF CASH FLOWS For the period March 21, 2001 (Inception) through July 31, 2001 Cash flows from operating activities: Net loss $ (12,508,837) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation 14,884 Contributed services of executive officer 20,000 Compensation expense related to common stock 12,328,887 Amortization of deferred compensation 22,500 Changes in operating assets and liabilities: Increase in accounts receivable (2,370) Increase in other current assets (7,550) Increase in accounts payable 51,537 Increase in patient deposits 11,105 Increase in sales tax payable and other liabilities 15,066 -------------- Net cash flows used in operating activities (54,778) -------------- Cash flows from investing activities: Purchase of property and equipment (14,341) -------------- Net cash flows used in investing activities (14,341) -------------- Cash flows from financing activities: Proceeds from issuance of common stock 73,371 Repayments on long-term debt (4,233) -------------- Net cash flows provided by financing activities 69,138 -------------- Net increase in cash 19 Cash at beginning of period - -------------- Cash at end of period $ 19 ============== The accompanying footnotes are an integral part of the financial statements. F-6 LASIK AMERICA, INC. STATEMENT OF CASH FLOWS (Continued) For the period March 21, 2001 (Inception) through July 31, 2001 SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: Cash paid during the period for: Interest $ 1,654 ================= Income taxes $ - ================= Supplemental disclosure of noncash investing and financing activities: Equipment obtained through issuance of long-term debt $ 220,316 ================= Deferred compensation for shares to employee $ 90,000 ================= The accompanying footnotes are an integral part of the financial statements. F-7 LASIK AMERICA, INC. NOTES TO FINANCIAL STATEMENTS For the period March 21, 2001 (Inception) through July 31, 2001 NOTE 1 - ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES - --------------------------------------------------------- Organization and Business ------------------------- Lasik America, Inc. (the "Company") was incorporated in the state of Nevada on March 21, 2001. The Company operates an ophthalmic laser vision correction center in Albuquerque, New Mexico. Fiscal Year ----------- The Company's year-end for financial reporting purposes is July 31. Financial Instruments --------------------- The carrying amounts reported in the balance sheet for cash, accounts receivable, accounts payable, sales tax payable and patient deposits approximate fair value due to the immediate short-term maturity of these financial instruments. The fair value of the Company's long-term debt approximates the carrying amount based on the current rates offered to the Company for debt of the same remaining maturities with similar collateral requirements. Property and Equipment ---------------------- Property and equipment are recorded at cost. Depreciation is calculated on a straight-line basis over the estimated useful lives of the depreciable assets which range from three to five years. Deferred Compensation --------------------- Deferred compensation represents the unamortized value of common stock granted to an employee. The deferred compensation recorded in the accompanying balance sheet is being amortized over the service period (one year) required for the employee to vest in the stock grant. Revenue Recognition ------------------- Revenues are generated by the vision correction procedures performed at the Company's laser center. Follow-up corrective procedures for customer satisfaction, consisting of retreatment, are performed when necessary. Facility fees are derived from the use of the Company's equipment by affiliate doctors who pay the Company a standard fee per procedure. The Company recognizes revenues when the vision correction procedures are performed. F-8 LASIK AMERICA, INC. NOTES TO FINANCIAL STATEMENTS For the period March 21, 2001 (Inception) through July 31, 2001 NOTE 1 - ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (Continued) - --------------------------------------------------------- Concentration Risk ------------------ The Company's revenues are generated by the vision correction procedures performed at its laser center in Albuquerque, New Mexico. If the demand for this procedure decreased or if the Company's ability to continue to provide this service was impaired, the Company's revenue source would be severely impacted. The Company is dependent on a small number of manufacturers for the supply of its excimer laser and related equipment. If any of these manufacturers were unable to continue to provide this equipment, the Company's revenue generating ability would be severely impacted. Earnings Per Share ------------------ In 1997, the FASB issued SFAS No. 128, "Earnings Per Share", which specifies the computation, presentation and disclosure requirements for earnings per share for entities with publicly held common stock. SFAS No. 128 supercedes the provisions of APB No. 15, and requires the presentation of basic earnings per share and diluted earnings per share. The Company has adopted the provisions of SFAS No. 128 effective March 21, 2001. Basic net income (loss) per share excludes dilution and is computed by dividing net income (loss) by the weighted average number of common shares outstanding during the reported periods. Diluted net income (loss) per share reflects the potential dilution that could occur if stock warrants and other commitments to issue common stock were exercised. During the period March 21, 2001 (Inception) through July 31, 2001, the Company had no outstanding warrants to purchase common shares and no warrants were included in the weighted average share computation. Due to the fact the initial common shares were issued at a price lower than the anticipated initial public offering price of $6.00 per share, the initial common shares have been treated as if they had been outstanding during the entire period March 21, 2001 (inception) through July 31, 2001. The Company is presenting its basic and diluted net loss per share as a single line on the statement of operations. Income Taxes ------------ The Company accounts for income taxes using the asset and liability method. Under the asset and liability method, deferred income taxes are recognized for the tax consequences of "temporary differences" by applying enacted statutory tax rates applicable to future years to differences between the financial statement carrying amounts and the tax bases of existing assets and liabilities. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. F-9 LASIK AMERICA, INC. NOTES TO FINANCIAL STATEMENTS For the period March 21, 2001 (Inception) through July 31, 2001 NOTE 1 - ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (Continued) - --------------------------------------------------------- Management's Plans for Future Operations and Financing ------------------------------------------------------ The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. At present, the Company's working capital plus limited capital resources will not be sufficient to meet the Company's objectives as structured. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty. The Company estimates it will need additional capital to achieve its operations as planned. The Company plans to seek up to approximately $2,600,000 in equity financing via a Form SB-2 offering pursuant to the Securities Act of 1933. In the event financing is not obtained, the Company will adjust its corporate infrastructure to reflect current operations. Use of Estimates ---------------- The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. NOTE 2 - PROPERTY AND EQUIPMENT - ------------------------------- Property and equipment consist of the following as of July 31, 2001: Medical equipment $ 224,161 Office equipment, furniture and fixtures 10,496 ----------------- 234,657 Less accumulated depreciation (14,884) ----------------- Net property and equipment $ 219,773 ================= F-10 LASIK AMERICA, INC. NOTES TO FINANCIAL STATEMENTS For the period March 21, 2001 (Inception) through July 31, 2001 NOTE 3 - LONG-TERM DEBT - ----------------------- Long-term debt consists of the following as of July 31, 2001: The Company's CEO has entered into a loan agreement for the acquisition of the excimer laser used in the operations of the Company. By oral agreement, the Company is acquiring the laser from the CEO under terms which mirror the original loan agreement. This loan bears interest at 10% per annum with interest and principal payable in monthly installments of approximately $6,200. The note is secured by a first security interest in the excimer laser and related equipment. The note is due in November 2003. $ 159,083 Unsecured note payable bearing interest at 10% per annum with interest and principal payable in monthly installments of approximately $3,400. The note is due in November 2002. Payments due to the holder of this note have been assigned to the Internal Revenue Service. (See Note 7). 57,000 ----------------- 216,083 Less: Current portion (110,263) ----------------- $ 105,820 ================= Aggregate maturities of long-term obligations at July 31 are as follows: Year ending Amount ----------- ----------------- 2002 $ 110,263 2003 81,573 2004 24,247 ----------------- $ 216,083 ================= NOTE 4 - COMMITMENTS - -------------------- The Company leases its facility on a month to month basis pending the completion of the new office facility. The monthly rent is $782. The Company has entered into a one year maintenance agreement for the laser with monthly payments of $4,375. The Company also leases certain surgical equipment with expiration dates through November 2001. Approximate minimum future obligations under these leases and the maintenance agreement as of July 31, 2002 are $53,875. Rent expense for the facility was $3,255 for the period March 21, 2001 (inception) through July 31, 2001. F-11 LASIK AMERICA, INC. NOTES TO FINANCIAL STATEMENTS For the period March 21, 2001 (Inception) through July 31, 2001 NOTE 5 - SHAREHOLDERS' EQUITY - ----------------------------- During March 2001, the Company sold 1,090,000 shares of common stock to the Company's CEO. As of July 31, 2001 these shares had not been issued. Proceeds from this transaction amounted to $8,510. Management has valued these shares at $6.00 per share based on the proximity of the anticipated initial public offering. As a result of this, the Company has taken a charge of $6,531,490 relating to this transaction which has been accounted for in the accompanying statement of operations as compensation expense related to common stock. During March 2001, the Company sold 775,000 shares of common stock to individuals, considered to related parties to the CEO, in conjunction with the formation of the Company. As of July 31, 2001 these shares had not been issued. Proceeds from this transaction amounted to $775. Management has valued these shares at $6.00 per share based on the proximity of the anticipated initial public offering. As a result of this, the Company has taken a charge of $4,649,225 relating to this transaction which has been accounted for in the accompanying statement of operations as compensation expense related to common stock. During April 2001, the Company granted 185,000 shares of common stock to employees. As of July 31, 2001 these shares had not been issued. Management has valued these shares at $6.00 per share based on the proximity of the anticipated initial public offering. One employee's stock award vests over a one year period. Accordingly, this amount is being amortized over the vesting period. As a result of these stock grants, the Company has taken a charge of $1,042,500, net of deferred compensation, which has been accounted for in the accompanying statement of operations as compensation expense related to common stock. During April, May and June 2001, the Company sold 32,043 shares of common stock to individuals considered to be related parties to the CEO. As of July 31, 2001 these shares had not been issued. Proceeds from these transactions amount to $64,086. Management has valued these shares at $6.00 per share based on the proximity of the anticipated initial public offering. As a result of this, the Company has taken a charge of $128,172 relating to this transaction which has been accounted for in the accompanying statement of operations as compensation expense related to common stock. For the period from March 21, 2001 (inception) through July 31, 2001, the CEO contributed services with a fair value of $20,000, at no cost. This amount is included in additional paid in capital and in general and administrative expenses for the period from March 21, 2001 (inception) through July 31, 2001. NOTE 6 - INCOME TAXES - --------------------- Deferred income taxes reflect the net tax effects of the temporary differences between the carrying amounts of assets and liabilities for financial reporting and the amounts used for income tax purposes. The tax effect of temporary differences consisted of the following as of July 31, 2001: F-12 LASIK AMERICA, INC. NOTES TO FINANCIAL STATEMENTS For the period March 21, 2001 (Inception) through July 31, 2001 NOTE 6 - INCOME TAXES (Continued) - --------------------- Deferred tax assets: Net operating loss carryforwards $ 102,600 ---------------- Gross deferred tax assets 102,600 Less valuation allowance (102,600) ---------------- Deferred tax liabilities - ---------------- $ - ================ Realization of deferred tax assets is dependant upon sufficient future taxable income during the period that deductible temporary differences and carryforwards are expected to be available to reduce taxable income. As the achievement of required future taxable income is uncertain, the Company recorded a valuation allowance. The valuation allowance increased by $102,600 during the period March 21, 2001 (inception) through July 31, 2001. As of July 31, 2001, the Company has net operating loss carryforwards for both federal and state income tax purposes. Federal net operating loss carryforwards totaling approximately $258,000 expire in 2021; state net operating loss carryforwards totaling approximately $258,000 expire in 2006. A reconciliation of the effective tax rates with the federal statutory rate is as follows for the period March 21, 2001 (inception) through July 31, 2001: Income tax benefit at 35% statutory rate $ (90,200) State income taxes, net (12,400) Change in valuation allowance 102,600 ----------------- $ - ================= NOTE 7 - RELATED PARTY TRANSACTION - ---------------------------------- During April 2001, the Company acquired certain medical and office equipment from a related entity via the execution of a promissory note to the related entity. This promissory note has been assigned by the related entity to the Internal Revenue Service. (See Note 3). F-13 LASIK AMERICA, INC. NOTES TO FINANCIAL STATEMENTS For the period March 21, 2001 (Inception) through July 31, 2001 NOTE 8 - SUBSEQUENT EVENT - -------------------------- During August 2001, the Company granted 125,000 warrants to purchase shares of the Company's common stock to the CEO at an exercise price of 120% of the initial public offering price of the common stock. These 125,000 warrants are being offered for resale as part of the 125,000 units being offered for resale by the selling shareholder. The warrants expire sixty months from the effective date of the Registration Statement filed on Form SB-2 by the Company and are exercisable at 120% of the initial offering price per share of the Common Stock. The warrants are redeemable by the Company commencing six months after the effective date of the offering at $0.10 per warrant, provided the average closing bid price for the Company's common stock equals or exceeds one hundred fifty percent of the initial public offering price per share for any twenty consecutive trading days. These warrants have been valued at $0.10 per share based on the price of similar warrants included in the units offered in the Form SB-2 offering. F-14 PART II INFORMATION NOT REQUIRED IN PROSPECTUS ITEM 24. INDEMNIFICATION OF DIRECTORS AND OFFICERS. Section 78.751 of the Nevada Business Corporation Act provides that a corporation may indemnify directors and officers as well as other employees and individuals against expenses (including attorneys' fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with any threatened, pending or completed actions, suits or proceedings in which such person is made a party by reason of such person being or having been a director, officer, employee or agent of the company. The Nevada Business Corporation Act provides that Section 78.751 is not exclusive of any other rights to which those seeking indemnification may be entitled under any bylaw, agreement, vote of stockholders or disinterested directors or otherwise. The Company's Articles of Incorporation dated March 21, 2001, provides for indemnification by the Registrant of its directors, officers and employees to the fullest extent permitted by the Nevada General Corporation Law. Section 78.751 of the Nevada Business Corporation Act permits a corporation to provide in its certificate of incorporation that a director of the corporation shall not be personally liable to the corporation or its stockholders for monetary damages for breach of fiduciary duty as a director, except for liability (i) for any breach of the director's duty of loyalty to the corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) for unlawful payments of dividends or unlawful stock repurchases, redemptions or other distributions, or (iv) for any transaction from which the director derived an improper personal benefit. The Registrant's Certificate of Incorporation eliminates the personal liability of directors to the furthest extent permissible under the Nevada Business Corporation Act. Reference is also made to the underwriting agreements filed as Exhibits 1.1 and 1.2 to the Registration Statement for information concerning the underwriters' obligation to indemnify the Registrant and its officers and directors as well as the selling shareholder, in certain circumstances, and our obligation and the obligation of the selling shareholder to indemnify the underwriters. Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant and the selling shareholder have been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. ITEM 25. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION. The estimated expenses to be incurred in connection with this offering are as follows: SEC Registration Fee........................................ $ 2,078 NASD Filing Fee............................................. $ 917 Accounting Fees and Expenses*............................... $ 25,000 Printing and Engraving*..................................... $ 20,000 Legal Fees and Expenses*.................................... $ 30,000 Blue Sky Fees and Expenses*................................. $ 7,500 Transfer Agent and Registrar Fees*.......................... $ 10,000 46 Miscellaneous Expenses*..................................... $ 12,500 -------- Total*................................................ $107,995 ======== ------------------------ * Estimated. ITEM 26. RECENT SALES OF UNREGISTERED SECURITIES. During the last three years, the Registrant has sold and issued the following unregistered securities in transactions which were exempt from registration under the Securities Act of 1933, pursuant to Section 4(2) of the Securities Act, as they were transactions not involving a public offering: In a private placement to accredited investors made by us shortly after our incorporation in March 2001, which was exempt from registration under the Securities Act pursuant to the statutory exemption from registration provided by Section 4(2) of the Securities Act and pursuant to Rule 506 of Regulation D promulgated thereunder, the Registrant offered and sold 1,865,000 shares of our common stock at par value, which is $.001 per share. During this same time, 185,000 additional shares of our common stock were issued to employees in lieu of cash compensation for their services rendered during the start-up of our operations. Pursuant to a warrant agreement we entered into with Howard P. Silverman, our chief executive officer, on August 24, 2001, we granted a redeemable common stock purchase warrant to Dr. Silverman entitling him to purchase 125,000 shares of our common stock at an exercise price of $7.20 per share as a part of his compensation for services rendered to us. Dr. Silverman's warrant is outstanding, has not been exercised, and is being registered for resale with his 125,000 units offered for sale by this registration statement and the prospectus which forms a part thereof. Our grant of the redeemable common stock purchase warrant to Dr. Silverman was a transaction exempt from registration pursuant to Section 4(2) of the Securities Act. Dr. Silverman had full access to our business plans, financial statements and financial projections. Dr. Silverman also had access to any other corporate information he requested when he received his warrant. In a private placement to five accredited investors made by us in April and May 2001, which was exempt from registration under the Securities Act pursuant to Rule 506 of Regulation D promulgated thereunder, the Registrant offered and sold 32,043 shares of our common stock at a price of $2.00 per share, for total gross aggregate offering proceeds of $64,086. ITEM 27. EXHIBITS. a. The following Exhibits are filed as a part of this Registration Statement pursuant to Item 601 of Regulation S-B: EXHIBIT NUMBER DESCRIPTION OF EXHIBITS - --------------- ----------------------------------------------------- 1.0 Form of Underwriting Agreement For The Registrant* 47 1.1 Form of Underwriting Agreement For Selling Shareholder* 1.2 Form of Representative's Warrant Agreement, including Form of Representative's Warrant* 1.3 Form of Public Warrant Agreement 3.1 Articles of Incorporation of Registrant 3.2 By-laws of the Registrant 4.0 Specimen of Common Stock Certificate 4.1 Specimen of Common Stock Purchase Warrant* 4.2 Specimen of Unit Certificate* 5.0 Opinion of Gregory Bartko, Esq.* 10.0 Warrant Agreement Dated August 24, 2001 Between the Registrant and Howard P. Silverman 10.1 Equipment Purchase Agreement Dated May 3, 2001 Between Howard P. Silverman and TrueVision Medical Associates, Inc. 10.2 Bill of Sale Dated May 3, 2001 Between TrueVision Medical Associates, Inc. 10.3 Promissory Note Dated May 3, 2001 by Howard P. Silverman and TrueVision Medical Associates, Inc. 10.4 Security Agreement Dated May 3, 2001 Between Howard P. Silverman and TrueVision Medical Associates, Inc. 10.5 Sales Agreement Dated May 10, 2001 Between VISX, Incorporated and the Registrant 10.6 VISX, Incorporated Patent License to the Registrant, Dated May 11, 2001 10.7 Equipment Lease Agreement Dated May 23, 2001 Between Bausch & Lomb and the Registrant 23.0 Consent of Gregory Bartko, Esq. (included in opinion filed as Exhibit 5.0)* 23.1 Consent of Pannell Kerr Forster, Certified Public Accountants, A Professional Corporation, San Diego, California, independent auditors 24.0 Power of Attorney (included in Part II of the Registration Statement under the caption "Signatures") ------------------------ * To be filed by amendment 48 ITEM 28. UNDERTAKINGS. (a) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the small business issuer pursuant to the foregoing provisions, or otherwise, the undersigned Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the undersigned Registrant of expenses incurred or paid by a director, officer or controlling person of the undersigned Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the undersigned Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. (b) The undersigned Registrant in all instances will provide to the Underwriter at the closing specified in the underwriting agreement certificates in such denominations and registered in such names as required by the underwriter to permit prompt delivery to each purchaser. (c) The undersigned Registrant hereby undertakes that: (1) For purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of a registration statement in reliance upon Rule 430A and contained in the form of prospectus filed by the undersigned Registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act of 1933 shall be deemed to be part of the registration statement as of the time it was declared effective; and (2) For the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (d) The undersigned Registrant hereby undertakes that it will: (1) File, during any period in which it offers or sells securities, a post-effective amendment to this registration statement to: (i) Include any prospectus required by Section 10(a)(3) of the Securities Act; (ii) Reflect in the prospectus any facts or events which, individually or together, represent a fundamental change in the information in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum 49 offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement; and (iii) Include any additional or changed material information on the plan of distribution; (2) For determining liability under the Securities Act, treat each post-effective amendment as a new registration statement of the securities offered, and the offering of the securities at that time to be the initial bona fide offering. (3) File a post-effective amendment to remove from registration any of the securities that remain unsold at the end of the offering. SIGNATURES In accordance with the requirements of the Securities Act of 1933, the Registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form SB-2 and authorized this amended registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Albuquerque, New Mexico, on the 6th day of September, 2001. LASIK AMERICA, INC. By: ---------------------------------------- Howard P. Silverman, president and chief executive officer NAME CAPACITY DATE - ----------------------------- ------------------------ ------------------- - ----------------------------- Chairman, president, September 6, 2001 Howard P. Silverman chief executive officer and director * - ----------------------------- Chief Operating Officer September 6, 2001 Robert S. Helmer and Director - ----------------------------- Principal Howard P. Silverman accounting officer September 6, 2001 * - ----------------------------- Director September 6, 2001 Stuart S. Greenberg * - ----------------------------- Director September 6, 2001 Steven L. De Vicenzi * Howard P. Silverman As Power of Attorney 50 LIST OF EXHIBITS EXHIBIT NUMBER DESCRIPTION OF EXHIBITS - --------------------- ----------------------------------------------------- 1.0 Form of Underwriting Agreement For The Registrant* 1.1 Form of Underwriting Agreement For Selling Shareholder* 1.2 Form of Representative's Warrant Agreement, including Form of Representative's Warrant* 1.3 Form of Public Warrant Agreement 3.1 Articles of Incorporation of Registrant 3.2 By-laws of the Registrant 4.0 Specimen of Common Stock Certificate 4.1 Specimen of Common Stock Purchase Warrant* 4.2 Specimen of Unit Certificate* 5.0 Opinion of Gregory Bartko, Esq.* 10.0 Warrant Agreement Dated August 24, 2001 Between the Registrant and Howard P. Silverman 10.1 Equipment Purchase Agreement Dated May 3, 2001 Between Howard P. Silverman and TrueVision Medical Associates, Inc. 10.2 Bill of Sale Dated May 3, 2001 Between TrueVision Medical Associates, Inc. 10.3 Promissory Note Dated May 3, 2001 by Howard P. Silverman and TrueVision Medical Associates, Inc. 10.4 Security Agreement Dated May 3, 2001 Between Howard P. Silverman and TrueVision Medical Associates, Inc. 10.5 Sales Agreement Dated May 10, 2001 Between VISX, Incorporated and the Registrant 10.6 VISX, Incorporated Patent License to the Registrant, Dated May 11, 2001 10.7 Equipment Lease Agreement Dated May 23, 2001 Between Bausch & Lomb and the Registrant 51 23.0 Consent of Gregory Bartko, Esq. (included in opinion filed as Exhibit 5.0)* 23.1 Consent of Pannell Kerr Forster, Certified Public Accountants, A Professional Corporation, San Diego, California, independent auditors 24.0 Power of Attorney (included in Part II of the Registration Statement under the caption "Signatures") - ------------------------ * To be filed by amendment 52 EX-1.3 3 file002.txt FORM OF PUBLIC WARRANT AGREEMENT Exhibit 1.3 ----------- - ---------------------------------------------------------------------- LASIK AMERICA, INC. AND CORPORATE STOCK TRANSFER ------------ WARRANT AGREEMENT DATED AS OF ___________, 2001 - ---------------------------------------------------------------------- 1 AGREEMENT, dated this _____ day of ________, 2001, by and between LASIK AMERICA, INC., a Nevada corporation (the "Company") and CORPORATE STOCK TRANSFER, as Warrant Agent (the "Warrant Agent"). W I T N E S S E T H: WHEREAS, in connection with (i) the offering to the public of 550,000 Units, which include, in the aggregate, (i) 550,000 shares of Common Stock (as defined in Section 1) and 550,000 redeemable common stock purchase warrants (the "Warrants"), each warrant entitling the holder thereof to purchase one additional share of Common Stock, and (ii) the sale to West America Securities Corp. ("WAS") the representative of the several underwriters (the "Representative"), of warrants (the "Representative's Warrants") to purchase up to 42,500 shares of Common Stock and/or 42,500 Warrants, the Company will issue up to 592,500 Warrants (subject to increase as provided in the Representative's Warrant Agreement); and WHEREAS, the Company desires to provide for the issuance of certificates representing the Warrants; and WHEREAS, the Company desires the Warrant Agent to act on behalf of the Company, and the Warrant Agent is willing to so act, in connection with the issuance, registration, transfer, exchange and redemption of the Warrants, the issuance of certificates representing the Warrants, the exercise of the Warrants and the rights of the holders thereof. NOW, THEREFORE, in consideration of the premises and the mutual agreements hereinafter set forth and for the purpose of defining the terms and provisions of the Warrants and the certificates representing the Warrants and the respective rights and obligations thereunder of the Company, the holders of certificates representing the Warrants and the Warrant Agent, the parties hereto agree as follows: SECTION 1. DEFINITIONS. As used herein, the following terms shall have the following meanings, unless the context shall otherwise require: (a) "Act" shall mean the Securities Act of 1933, as amended. (b) "Amex" shall mean the American Stock Exchange. (c) "Common Stock" shall mean the authorized stock of the Company of any class, whether now or hereafter authorized, which has the right to participate in the voting and in the distribution of earnings and assets of the Company without limit as to amount or percentage. (d) "Commission" shall mean the Securities and Exchange Commission. (e) "Corporate Office" shall mean the office of the Warrant Agent (or its successor) at which at any particular time its business in Denver, Colorado, shall be administered, which office is located on the date hereof at 3200 Cherry Creek Drive South, Suite 430, Denver, Colorado 80209. (f) "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended. 2 (g) "Exercise Date" shall mean, subject to the provisions of Section 5(b) hereof, as to any Warrant, the date on which the Warrant Agent shall have received both (i) the Warrant Certificate representing such Warrant, with the exercise form thereon duly executed by the Registered Holder thereof or his attorney duly authorized in writing, and (ii) payment in cash or by official bank or certified check made payable to the Warrant Agent for the account of the Company, of the amount in lawful money of the United States of America equal to the applicable Purchase Price (as hereinafter defined) in good funds. (h) "Initial Public Offering Price" shall mean $6.00 per Share of Common Stock. (i) "Initial Warrant Exercise Date" shall mean _________, 2002. [six months from the date of issuance] (j) "Initial Warrant Redemption Date" shall mean __________, 2002. [six months from the date of issuance] (k) "NASD" shall mean the National Association of Securities Dealers, Inc. (l) "Nasdaq" shall mean the Nasdaq Stock Market. (m) "Purchase Price" shall mean, subject to modification and adjustment as provided in Section 8, $7.20 and further subject to the Company's right, in its sole discretion, to decrease the Purchase Price for a period of not less than 30 days on not less than 30 days' prior written notice to the Registered Holders. (n) "Redemption Date" shall mean the date (which may not occur before the Initial Warrant Redemption Date) fixed for the redemption of the Warrants in accordance with the terms hereof. (o) "Redemption Price" shall mean the price at which the Company may, at its option, redeem the Warrants, in accordance with the terms hereof, which price shall be $0.10 per Warrant, subject to adjustment from time to time pursuant to the provisions of Section 9 hereof. (p) "Registered Holder" shall mean the person in whose name any certificate representing the Warrants shall be registered on the booksmaintained by the Warrant Agent pursuant to Section 6. (q) "Transfer Agent" shall mean Corporate Stock Transfer, or its authorized successor. (r) "Underwriting Agreement" shall mean the underwriting agreement dated __________, 2001 between the Company and the several underwriters listed therein relating to the purchase for resale to the public of the Common Stock and the Warrants. (s) "Representative's Warrant Agreement" shall mean the agreement dated as of ___________, 2001 between the Company and the Representative relating to and governing the terms and provisions of the Representative's Warrants. 3 (t) "Warrant Certificate" shall mean a certificate representing each of the Warrants substantially in the form annexed hereto as Exhibit A. (u) "Warrant Expiration Date" shall mean, unless the Warrants are redeemed as provided in Section 9 hereof prior to such date, 5:30 p.m. (New York time), on ___________, 2005 [five years after date of Prospectus], or the Redemption Date as defined herein, whichever date is earlier; PROVIDED that if such date shall in the State of New York be a holiday or a day on which banks are authorized to close, then 5:30 p.m. (New York time) on the next following day which, in the State of New York, is not a holiday or a day on which banks are authorized to close. Upon five business days' prior written notice to the Registered Holders, the Company shall have the right to extend the Warrant Expiration Date. SECTION 2. WARRANTS AND ISSUANCE OF WARRANT CERTIFICATES. (a) Each Warrant shall initially entitle the Registered Holder of the Warrant Certificate representing such Warrant to purchase at the Purchase Price therefor from the Initial Warrant Exercise Date until the Warrant Expiration Date one share of Common Stock upon the exercise thereof in accordance with the terms hereof, subject to modification and adjustment as provided in Section 8. (b) Upon execution of this Agreement, Warrant Certificates representing the number of Warrants sold pursuant to the Underwriting Agreement (subject to modification and adjustment as provided in Section 8) shall be executed by the Company and delivered to the Warrant Agent. (c) Upon exercise of the Representative's Warrants as provided therein, Warrant Certificates representing all or a portion of 550,000 Warrants to purchase up to an aggregate of 550,000 shares of Common Stock (subject to modification and adjustment as provided in Section 8 hereof and in the Representative's Warrant Agreement), shall be countersigned, issued and delivered by the Warrant Agent upon written order of the Company signed by its Chairman of the Board, Chief Executive Officer, President or a Vice President and by its Treasurer or an Assistant Treasurer or its Secretary or an Assistant Secretary. (d) From time to time, up to the Warrant Expiration Date or the Redemption Date, whichever date is earlier, the Warrant Agent shall countersign and deliver Warrant Certificates in required denominations of one or whole number multiples thereof to the person entitled thereto in connection with any transfer or exchange permitted under this Agreement. Except as provided herein, no Warrant Certificates shall be issued except (i) Warrant Certificates initially issued hereunder and those issued on or after the Initial Warrant Exercise Date, upon the exercise of fewer than all Warrants held by the exercising Registered Holder, (ii) Warrant Certificates issued upon any transfer or exchange of Warrants, (iii) Warrant Certificates issued in replacement of lost, stolen, destroyed or mutilated Warrant Certificates pursuant to Section 7, (iv) Warrant Certificates issued pursuant to the Representative's Warrant Agreement, and (v) at the option of the Company, Warrant Certificates in such form as may be approved by its Board of Directors, to reflect any adjustment or change in the Purchase Price, the number of shares of Common Stock purchasable upon exercise of the Warrants or the Redemption Price therefor made pursuant to Section 8 hereof. 4 SECTION 3. FORM AND EXECUTION OF WARRANT CERTIFICATES. (a) The Warrant Certificates shall be substantially in the form annexed hereto as Exhibit A (the provisions of which are hereby incorporated herein) and may have such letters, numbers or other marks of identification or designation and such legends, summaries or endorsements printed, lithographed or engraved thereon as the Company may deem appropriate and as are not inconsistent with the provisions of this Agreement, or as may be required to comply with any law or with any rule or regulation made pursuant thereto or with any rule or regulation of any stock exchange on which the Warrants may be listed, or to conform to usage. The Warrant Certificates shall be dated the date of issuance thereof (whether upon initial issuance, transfer, exchange or in lieu of mutilated, lost, stolen or destroyed Warrant Certificates) and issued in registered form. Warrants shall be numbered serially with the letter W on the Warrants. (b) Warrant Certificates shall be executed on behalf of the Company by its Chairman of the Board, Chief Executive Officer, President or any Vice President and by its Treasurer or an Assistant Treasurer or its Secretary or an Assistant Secretary, by manual signatures or by facsimile signatures printed thereon, and shall have imprinted thereon a facsimile of the Company's seal. Warrant Certificates shall be manually countersigned by the Warrant Agent and shall not be valid for any purpose unless so countersigned. In case any officer of the Company who shall have signed any of the Warrant Certificates shall cease to be such officer of the Company before the date of issuance of the Warrant Certificates or before countersignature by the Warrant Agent and issue and delivery thereof, such Warrant Certificates, nevertheless, may be countersigned by the Warrant Agent, issued and delivered with the same force and effect as though the person who signed such Warrant Certificates had not ceased to be such officer of the Company. After countersignature by the Warrant Agent, Warrant Certificates shall be delivered by the Warrant Agent to the Registered Holder promptly and without further action by the Company, except as otherwise provided by Section 4(a) hereof. SECTION 4. EXERCISE. (a) Warrants in denominations of one or whole number multiples thereof may be exercised by the Registered Holder thereof commencing at any time on or after the Initial Warrant Exercise Date, but not after the Warrant Expiration Date, upon the terms and subject to the conditions set forth herein and in the applicable Warrant Certificate. A Warrant shall be deemed to have been exercised immediately prior to the close of business on the Exercise Date and the person entitled to receive the securities deliverable upon such exercise shall be treated for all purposes as the holder, upon exercise thereof, as of the close of business on the Exercise Date. If Warrants in denominations other than whole number multiples thereof shall be exercised at one time by the same Registered Holder, the number of full shares of Common Stock which shall be issuable upon exercise thereof shall be computed on the basis of the aggregate number of full shares of Common Stock issuable upon such exercise. As soon as practicable on or after the Exercise Date and in any event within five business days after such date, if one or more Warrants have been exercised, the Warrant Agent on behalf of the Company shall cause to be issued to the person or persons entitled to receive the same a Common Stock certificate or certificates for the shares of Common Stock deliverable upon such exercise, and the Warrant Agent 5 shall deliver the same to the person or persons entitled thereto. Upon the exercise of any one or more Warrants, the Warrant Agent shall promptly notify the Company in writing of such fact and of the number of securities delivered upon such exercise and, subject to subsection (b) below, shall cause all payments of an amount in cash or by check made payable to the order of the Company, equal to the Purchase Price, to be deposited promptly in the Company's bank account. (b) The Company shall not be required to issue fractional shares on the exercise of Warrants. Warrants may only be exercised in such multiples as are required to permit the issuance by the Company of one or more whole shares. If one or more Warrants shall be presented for exercise in full at the same time by the same Registered Holder, the number of whole shares which shall be issuable upon such exercise thereof shall be computed on the basis of the aggregate number of shares purchasable on exercise of the Warrants so presented. If any fraction of a share would, except for the provisions provided herein, be issuable on the exercise of any Warrant (or specified portion thereof), the Company shall pay an amount in cash equal to such fraction multiplied by the then current market value of a share of Common Stock, determined as follows: (1) If the Common Stock is listed, or admitted to unlisted trading privileges on a national securities exchange, or is traded on Nasdaq, the current market value of a share of Common Stock shall be the closing sale price of the Common Stock at the end of the regular trading session on the last business day prior to the date of exercise of the Warrants on whichever of such exchanges or Nasdaq had the highest average daily trading volume for the Common Stock on such day; or (2) If the Common Stock is not listed or admitted to unlisted trading privileges on any national securities exchange, or listed, quoted or reported for trading on Nasdaq, but is traded in the over-the-counter market, the current market value of a share of Common Stock shall be the average of the last reported bid and asked prices of the Common Stock reported by the National Quotation Bureau, Inc. on the last business day prior to the date of exercise of the Warrants; or (3) If the Common Stock is not listed, admitted to unlisted trading privileges on any national securities exchange, or listed, quoted or reported for trading on Nasdaq, and bid and asked prices of the Common Stock are not reported by the National Quotation Bureau, Inc., the current market value of a share of Common Stock shall be an amount, not less than the book value thereof as of the end of the most recently completed fiscal quarter of the Company ending prior to the date of exercise, determined by the members of the Board of Directors of the Company exercising good faith and using customary valuation methods. SECTION 5. RESERVATION OF SHARES; LISTING; PAYMENT OF TAXES; ETC. (a) The Company covenants that it will at all times reserve and keep available out of its authorized Common Stock, solely for the purpose of issue upon exercise of Warrants, such number of shares of Common Stock as shall then be issuable upon the exercise of all outstanding Warrants. The Company covenants that all shares of Common Stock which shall be issuable upon exercise 6 of the Warrants shall, at the time of delivery thereof, be duly and validly issued and fully paid and nonassessable and free from all preemptive or similar rights, taxes, liens and charges with respect to the issue thereof, and that upon issuance such shares shall be listed on each securities exchange, if any, on which the other shares of outstanding Common Stock of the Company are then listed. (b) The Company covenants that if any securities to be reserved for the purpose of exercise of Warrants hereunder require registration with, or approval of, any governmental authority under any federal securities law before such securities may be validly issued or delivered upon such exercise, then the Company will file a registration statement under the federal securities laws or a post-effective amendment, use its best efforts to cause the same to become effective and to keep such registration statement current while any of the Warrants are outstanding and deliver a prospectus which complies with Section 10(a)(3) of the Act, to the Registered Holder exercising the Warrant (except, if in the opinion of counsel to the Company, such registration is not required under the federal securities law or if the Company receives a letter from the staff of the Commission stating that it would not take any enforcement action if such registration is not effected). The Company will use its best efforts to obtain appropriate approvals or registrations under state "blue sky" securities laws with respect to any such securities. However, Warrants may not be exercised by, or shares of Common Stock issued to, any Registered Holder in any state in which such exercise would be unlawful. (c) The Company shall pay all documentary, stamp or similar taxes and other governmental charges that may be imposed with respect to the issuance of Warrants, or the issuance or delivery of any shares of Common Stock upon exercise of the Warrants; provided, however, that if shares of Common Stock are to be delivered in a name other than the name of the Registered Holder of the Warrant Certificate representing any Warrant being exercised, then no such delivery shall be made unless the person requesting the same has paid to the Warrant Agent the amount of transfer taxes or charges incident thereto, if any. (d) The Warrant Agent is hereby irrevocably authorized as the Transfer Agent to requisition from time to time certificates representing shares of Common Stock or other securities required upon exercise of the Warrants, and the Company will comply with all such requisitions. SECTION 6. EXCHANGE AND REGISTRATION OF TRANSFER. (a) Warrant Certificates may be exchanged for other Warrant Certificates representing an equal aggregate number of Warrants of the same class or may be transferred in whole or in part. Warrant Certificates to be exchanged shall be surrendered to the Warrant Agent at its Corporate Office, and, upon satisfaction of the terms and provisions hereof, the Company shall execute and the Warrant Agent shall countersign, issue and deliver in exchange therefor the Warrant Certificate or Certificates which the Registered Holder making the exchange shall be entitled to receive. (b) The Warrant Agent shall keep, at its office, books in which, subject to such reasonable regulations as it may prescribe, it shall register Warrant Certificates and the transfer thereof in accordance with customary 7 practice. Upon due presentment for registration of transfer of any Warrant Certificate at such office, the Company shall execute and the Warrant Agent shall issue and deliver to the transferee or transferees a new Warrant Certificate or Certificates representing an equal aggregate number of Warrants of the same class. (c) With respect to all Warrant Certificates presented for registration of transfer, or for exchange or exercise, the subscription or exercise form, as the case may be, on the reverse thereof shall be duly endorsed or be accompanied by a written instrument or instruments of transfer and subscription, in form satisfactory to the Company and the Warrant Agent, duly executed by the Registered Holder thereof or his attorney-in-fact duly authorized in writing. (d) A service charge may be imposed by the Warrant Agent for any exchange or registration of transfer of Warrant Certificates. In addition, the Company may require payment by such Holder of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection therewith. (e) All Warrant Certificates surrendered for exercise or for exchange in case of mutilated Warrant Certificates shall be promptly canceled by the Warrant Agent and thereafter retained by the Warrant Agent until termination of this Agreement. (f) Prior to due presentment for registration of transfer thereof, the Company and the Warrant Agent may deem and treat the Registered Holder of any Warrant Certificate as the absolute owner thereof and of each Warrant represented thereby (notwithstanding any notations of ownership or writing thereon made by anyone other than a duly authorized officer of the Company or the Warrant Agent) for all purposes and shall not be affected by any notice to the contrary. SECTION 7. LOSS OR MUTILATION. Upon receipt by the Company and the Warrant Agent of evidence satisfactory to them of the ownership of and the loss, theft, destruction or mutilation of any Warrant Certificate and (in the case of loss, theft or destruction) of indemnity satisfactory to them, and (in case of mutilation) upon surrender and cancellation thereof, the Company shall execute and the Warrant Agent shall (in the absence of notice to the Company and/or the Warrant Agent that a new Warrant Certificate has been acquired by a bona fide purchaser) countersign and deliver to the Registered Holder in lieu thereof a new Warrant Certificate of like tenor representing an equal aggregate number of Warrants. Applicants for a substitute Warrant Certificate shall also comply with such other reasonable regulations and pay such other reasonable charges as the Warrant Agent may prescribe. SECTION 8. ADJUSTMENT OF PURCHASE PRICE AND NUMBER OF SHARES OF COMMON STOCK DELIVERABLE. (a) Except as hereinafter provided, in the event the Company shall, issue or sell any shares of Common Stock for a consideration per share less than the Initial Public Offering Price of the shares of Common Stock or issue any shares of Common Stock as a stock dividend to the holders of Common Stock, or subdivide or combine the outstanding shares of Common Stock into a greater or lesser number of shares (any such issuance, subdivision or combination being 8 herein called a "Change of Shares"), then, and thereafter upon each further Change of Shares, the Purchase Price for the Warrants (whether or not the same shall be issued and outstanding) in effect immediately prior to such Change of Shares shall be changed to a price (including any applicable fraction of a cent to the nearest cent) determined by dividing (i) the sum of (a) the total number of shares of Common Stock outstanding immediately prior to such Change of Shares, multiplied by the Purchase Price in effect immediately prior to such Change of Shares and (b) the consideration, if any, received by the Company upon such sale, issuance, subdivision or combination, by (ii) the total number of shares of Common Stock outstanding immediately after such Change of Shares; PROVIDED, HOWEVER, that in no event shall the Purchase Price be adjusted pursuant to this computation to an amount in excess of the Purchase Price in effect immediately prior to such computation, except in the case of a combination of outstanding shares of Common Stock. For the purposes of any adjustment to be made in accordance with this Section 8(a), the following provisions shall be applicable: (A) In case of the issuance or sale of shares of Common Stock (or of other securities deemed hereunder to involve the issuance or sale of shares of Common Stock) for a consideration part or all of which shall be cash, the amount of the cash portion of the consideration therefor deemed to have been received by the Company shall be (i) the subscription price, if shares of Common Stock are offered by the Company for subscription, or (ii) the public offering price (before deducting therefrom any compensation paid or discount allowed in the sale, underwriting or purchase thereof by underwriters or dealers or others performing similar services, or any expenses incurred in connection therewith), if such securities are sold to underwriters or dealers for public offering without a subscription offering, or (iii) the gross amount of cash actually received by the Company for such securities, in any other case. (B) In case of the issuance or sale (otherwise than as a dividend or other distribution on any stock of the Company, and otherwise than on the exercise of options, rights or warrants or the conversion or exchange of convertible or exchangeable securities) of shares of Common Stock (or of other securities deemed hereunder to involve the issuance or sale of shares of Common Stock) for a consideration part or all of which shall be other than cash, the amount of the consideration therefor other than cash deemed to have been received by the Company shall be the value of such consideration as determined in good faith by the Board of Directors of the Company, using customary valuation methods and on the basis of prevailing market values for similar property or services. (C) Shares of Common Stock issuable by way of dividend or other distribution on any stock of the Company shall be deemed to have been issued immediately after the opening of business on the day following the record date for the determination of shareholders entitled to receive such dividend or other distribution and shall be deemed to have been issued without consideration. (D) The reclassification of securities of the Company other than shares of Common Stock into securities including shares of Common Stock 9 shall be deemed to involve the issuance of such shares of Common Stock for a consideration other than cash immediately prior to the close of business on the date fixed for the determination of security holders entitled to receive such shares, and the value of the consideration allocable to such shares of Common Stock shall be determined as provided in subsection (B) of this Section 8(a). (E) The number of shares of Common Stock at any one time outstanding shall be deemed to include the aggregate maximum number of shares issuable (subject to readjustment upon the actual issuance thereof) upon the exercise of options, rights or warrants and upon the conversion or exchange of convertible or exchangeable securities. (b) Upon each adjustment of the Purchase Price pursuant to this Section 8, the number of shares of Common Stock purchasable upon the exercise of each Warrant shall be the number derived by multiplying the number of shares of Common Stock purchasable immediately prior to such adjustment by the Purchase Price in effect prior to such adjustment and dividing the product so obtained by the applicable adjusted Purchase Price. (c) In case the Company shall at any time after the date hereof issue options, rights or warrants to subscribe for shares of Common Stock, or issue any securities convertible into or exchangeable for shares of Common Stock, for a consideration per share (determined as provided in Sections 8(a) and 8(b) and as provided below) less than the Initial Public Offering Price of the Common Stock, or without consideration (including the issuance of any such securities by way of dividend or other distribution), the Purchase Price for the Warrants (whether or not the same shall be issued and outstanding) in effect immediately prior to the issuance of such options, rights or warrants, or such convertible or exchangeable securities, as the case may be, shall be reduced to a price determined by making the computation in accordance with the provisions of Sections 8(a) and 8(b) hereof, PROVIDED that: (A) The aggregate maximum number of shares of Common Stock, as the case may be, issuable or that may become issuable under such options, rights or warrants (assuming exercise in full even if not then currently exercisable or currently exercisable in full) shall be deemed to be issued and outstanding at the time such options, rights or warrants were issued, for a consideration equal to the minimum purchase price per share provided for in such options, rights or warrants at the time of issuance, plus the consideration, if any, received by the Company for such options, rights or warrants; PROVIDED, HOWEVER, that upon the expiration or other termination of such options, rights or warrants, if any thereof shall not have been exercised, the number of shares of Common Stock deemed to be issued and outstanding pursuant to this subsection (A) (and for the purposes of subsection (E) of Section 8(a) hereof) shall be reduced by the number of shares as to which options, warrants and/or rights shall have expired, and such number of shares shall no longer be deemed to be issued and outstanding, and the Purchase Price then in effect shall forthwith be readjusted and thereafter be the price that it would have been had adjustment been made on the basis of the issuance only of the shares actually issued plus the shares remaining issuable upon the exercise of those options, rights or warrants as to which the exercise rights shall not have expired or terminated unexercised. (B) The aggregate maximum number of shares of Common Stock issuable or that may become issuable upon conversion or exchange of any 10 convertible or exchangeable securities (assuming conversion or exchange in full even if not then currently convertible or exchangeable in full) shall be deemed to be issued and outstanding at the time of issuance of such securities, for a consideration equal to the consideration received by the Company for such securities, plus the minimum consideration, if any, receivable by the Company upon the conversion or exchange thereof; PROVIDED, HOWEVER, that upon the termination of the right to convert or exchange such convertible or exchangeable securities (whether by reason of redemption or otherwise), the number of shares of Common Stock deemed to be issued and outstanding pursuant to this subsection (B) (and for the purposes of subsection (E) of Section 8(a) hereof) shall be reduced by the number of shares as to which the conversion or exchange rights shall have expired or terminated unexercised, and such number of shares shall no longer be deemed to be issued and outstanding, and the Purchase Price then in effect shall forthwith be readjusted and thereafter be the price that it would have been had adjustment been made on the basis of the issuance only of the shares actually issued plus the shares remaining issuable upon conversion or exchange of those convertible or exchangeable securities as to which the conversion or exchange rights shall not have expired or terminated unexercised. (C) If any change shall occur in the price per share provided for in any of the options, rights or warrants referred to in subsection (A) of this Section 8(c), or in the price per share or ratio at which the securities referred to in subsection (B) of this Section 8(c) are convertible or exchangeable, such options, rights or warrants or conversion or exchange rights, as the case may be, to the extent not theretofore exercised, shall be deemed to have expired or terminated on the date when such price change became effective in respect of shares not theretofore issued pursuant to the exercise or conversion or exchange thereof, and the Company shall be deemed to have issued upon such date new options, rights or warrants or convertible or exchangeable securities. (d) In case of any reclassification or change of outstanding shares of Common Stock issuable upon exercise of the Warrants (other than a change in par value, or from par value to no par value, or from no par value to par value or as a result of a subdivision or combination), or in case of any consolidation or merger of the Company with or into another corporation (other than (1) a merger with a subsidiary of the Company in which merger the Company is the continuing corporation or (2) any consolidation or merger of the Company with or into another corporation which, in either instance, does not result in any reclassification or change of the then outstanding shares of Common Stock or other capital stock issuable upon exercise of the Warrants (other than a change in par value, or from par value to no par value, or from no par value to par value or as a result of subdivision or combination)) or in case of any sale or conveyance to another corporation of the property of the Company as an entirety or substantially as an entirety, then, as a condition of such reclassification, change, consolidation, merger, sale or conveyance, the Company, or such successor or purchasing corporation, as the case may be, shall make lawful and adequate provision whereby the Registered Holder of each Warrant then outstanding shall have the right thereafter to receive on exercise of such Warrant the kind and amount of securities and property receivable upon such reclassification, change, consolidation, merger, sale or conveyance by a holder of the number of securities issuable upon exercise of such Warrant immediately prior to such reclassification, change, consolidation, merger, sale or conveyance and shall forthwith file at the Corporate Office of the Warrant Agent 11 a statement signed by its Chief Executive Officer, President or a Vice President and by its Treasurer or an Assistant Treasurer or its Secretary or an assistant Secretary evidencing such provision. Such provisions shall include provision for adjustments which shall be as nearly equivalent as may be practicable to the adjustments provided for in Sections 8(a), (b) and (c). The above provisions of this Section 8(d) shall similarly apply to successive reclassifications and changes of shares of Common Stock and to successive consolidations, mergers, sales or conveyances. (e) Irrespective of any adjustments or changes in the Purchase Price or the number of shares of Common Stock purchasable upon exercise of the Warrants, the Warrant Certificates theretofore and thereafter issued shall, unless the Company shall exercise its option to issue new Warrant Certificates pursuant to Section 2(e) hereof, continue to express the Purchase Price per share and the number of shares purchasable thereunder as the Purchase Price per share and the number of shares purchasable thereunder were expressed in the Warrant Certificates when the same were originally issued. (f) After each adjustment of the Purchase Price pursuant to this Section 8, the Company will promptly prepare a certificate signed by the Chairman, Chief Executive Officer or President, and by the Treasurer or an Assistant Treasurer or the Secretary or an Assistant Secretary, of the Company setting forth: (i) the Purchase Price as so adjusted, (ii) the number of shares of Common Stock purchasable upon exercise of each Warrant, after such adjustment, and (iii) a brief statement of the facts accounting for such adjustment. The Company will promptly file such certificate with the Warrant Agent and cause a brief summary thereof to be sent by ordinary first class mail to each Registered Holder at his last address as it shall appear on the registry books of the Warrant Agent. No failure to mail such notice nor any defect therein or in the mailing thereof shall affect the validity thereof except as to the holder to whom the Company failed to mail such notice, or except as to the holder whose notice was defective. The affidavit of an officer of the Warrant Agent or the Secretary or an Assistant Secretary of the Company that such notice has been mailed shall, in the absence of fraud, be prima facie evidence of the facts stated therein. (g) No adjustment of the Purchase Price shall be made as a result of or in connection with (A) the issuance or sale of shares of Common Stock pursuant to options, warrants, stock purchase agreements and convertible or exchangeable securities outstanding or in effect on the date hereof and on the terms described in the final prospectus relating to the public offering contemplated by the Underwriting Agreement; (B) stock options to be granted under the Company's 1998 Incentive Stock Option Plan or any other stock option plan which has been approved by the Company's stockholders to employees, consultants and directors; or (C) the issuance or sale of shares of Common Stock if the amount of said adjustment shall be less than $.10, PROVIDED, HOWEVER, that in such case, any adjustment that would otherwise be required then to be made shall be carried forward and shall be made at the time of and together with the next subsequent adjustment that shall amount, together with any adjustment so carried forward, to at least $.10. In addition, Registered Holders shall not be entitled to cash dividends paid by the Company prior to the exercise of any Warrant or Warrants held by them. 12 SECTION 9. REDEMPTION. (a) Commencing on the Initial Warrant Redemption Date, the Company may, on 30 days' prior written notice, redeem all the Warrants at ten cents ($.10) per Warrant, PROVIDED, HOWEVER, that before any such call for redemption of Warrants can take place, the average closing bid price for the Common Stock as reported by Nasdaq, if the Common Stock is then traded on Nasdaq, (or the average closing sale price, if the Common Stock is then traded on Amex) shall have equaled or exceeded $9.00 per share for any twenty (20) trading days prior to the date on which the notice contemplated by (b) and (c) below is given (subject to adjustment in the event of any stock splits or other similar events as provided in Section 8 hereof). (b) In case the Company shall exercise its right to redeem all of the Warrants, it shall give or cause to be given notice to the Registered Holders of the Warrants, by mailing to such Registered Holders a notice of redemption, first class, postage prepaid, at their last address as shall appear on the records of the Warrant Agent. Any notice mailed in the manner provided herein shall be conclusively presumed to have been duly given whether or not the Registered Holder receives such notice. Not less than four (4) trading days prior to the mailing to the Registered Holders of the Warrants of the notice of redemption, the Company shall deliver or cause to be delivered to WAS a similar notice telephonically and confirmed in writing together with a list of the Registered Holders (including their respective addresses and number of Warrants beneficially owned) to whom such notice of redemption has been or will be given. (c) The notice of redemption shall specify (i) the redemption price, (ii) the Redemption Date, which shall in no event be less than thirty (30) days after the date of mailing of such notice, (iii) the place where the Warrant Certificate shall be delivered and the redemption price shall be paid, and (iv) that the right to exercise the Warrant shall terminate at 5:30 p.m. (New York time) on the business day immediately preceding the date fixed for redemption. No failure to mail such notice nor any defect therein or in the mailing thereof shall affect the validity of the proceedings for such redemption except as to a holder (a) to whom notice was not mailed or (b) whose notice was defective. An affidavit of the Warrant Agent or the Secretary or Assistant Secretary of the Company that notice of redemption has been mailed shall, in the absence of fraud, be prima facie evidence of the facts stated therein. (d) Any right to exercise a Warrant shall terminate at 5:30 p.m. (New York time) on the business day immediately preceding the Redemption Date. The redemption price payable to the Registered Holders shall be mailed to such persons at their addresses of record. SECTION 10. CONCERNING THE WARRANT AGENT. (a) The Warrant Agent acts hereunder as agent and in a ministerial capacity for the Company, and its duties shall be determined solely by the provisions hereof. The Warrant Agent shall not, by issuing and delivering Warrant Certificates or by any other act hereunder, be deemed to make any representations as to the validity or value or authorization of the Warrant Certificates or the Warrants represented thereby or of any securities or other property delivered upon exercise of any Warrant or whether any stock issued upon exercise of any Warrant is fully paid and nonassessable. 13 (b) The Warrant Agent shall not at any time be under any duty or responsibility to any holder of Warrant Certificates to make or cause to be made any adjustment of the Purchase Price or the Redemption Price provided in this Agreement, or to determine whether any fact exists which may require any such adjustments, or with respect to the nature or extent of any such adjustments, when made, or with respect to the method employed in making the same. It shall not (i) be liable for any recital or statement of fact contained herein or for any action taken, suffered or omitted by it in reliance on any Warrant Certificate or other document or instrument believed by it in good faith to be genuine and to have been signed or presented by the proper party or parties, (ii) be responsible for any failure on the part of the Company to comply with any of its covenants and obligations contained in this Agreement or in any Warrant Certificate, or (iii) be liable for any act or omission in connection with this Agreement except for its own negligence, bad faith or willful misconduct. (c) The Warrant Agent may at any time consult with counsel satisfactory to it (who may be counsel for the Company or for WAS) and shall incur no liability or responsibility for any action taken, suffered or omitted by it in good faith in accordance with the opinion or advice of such counsel. (d) Any notice, statement, instruction, request, direction, order or demand of the Company shall be sufficiently evidenced by an instrument signed by the Chairman of the Board of Directors, Chief Executive Officer, President or any Vice President (unless other evidence in respect thereof is herein specifically prescribed). The Warrant Agent shall not be liable for any action taken, suffered or omitted by it in accordance with such notice, statement, instruction, request, direction, order or demand reasonably believed by it to be genuine. (e) The Company agrees to pay the Warrant Agent reasonable compensation for its services hereunder and to reimburse it for its reasonable expenses hereunder; the Company further agrees to indemnify the Warrant Agent and save it harmless from and against any and all losses, expenses and liabilities, including judgments, costs and counsel fees, for anything done or omitted by the Warrant Agent in the execution of its duties and powers hereunder EXCEPT losses, expenses and liabilities arising as a result of the Warrant Agent's negligence, bad faith or willful misconduct. (f) The Warrant Agent may resign its duties and be discharged from all further duties and liabilities hereunder (except liabilities arising as a result of the Warrant Agent's own gross negligence or willful misconduct), after giving 30 days' prior written notice to the Company. At least 15 days prior to the date such resignation is to become effective, the Warrant Agent shall cause a copy of such notice of resignation to be mailed to the Registered Holder of each Warrant Certificate at the Company's expense. Upon such resignation, or any inability of the Warrant Agent to act as such hereunder, the Company shall appoint in writing a new warrant agent. If the Company shall fail to make such appointment within a period of 15 days after it has been notified in writing of such resignation by the resigning Warrant Agent, then the Registered Holder of any Warrant Certificate may apply to any court of competent jurisdiction for the 14 appointment of a new warrant agent. Any new warrant agent, whether appointed by the Company or by such a court, shall be a bank or trust company having a capital and surplus, as shown by its last published report to its stockholders, of not less than $10,000,000 or a stock transfer company. After acceptance in writing of such appointment by the new warrant agent is received by the Company, such new warrant agent shall be vested with the same powers, rights, duties and responsibilities as if it had been originally named herein as the Warrant Agent, without any further assurance, conveyance, act or deed; but if for any reason it shall be necessary or expedient to execute and deliver any further assurance, conveyance, act or deed, the same shall be done at the expense of the Company and shall be legally and validly executed and delivered by the resigning Warrant Agent. Not later than the effective date of any such appointment the Company shall file notice thereof with the resigning Warrant Agent and shall forthwith cause a copy of such notice to be mailed to the Registered Holder of each Warrant Certificate. (g) Any corporation into which the Warrant Agent or any new warrant agent may be converted or merged, any corporation resulting from any consolidation to which the Warrant Agent or any new warrant agent shall be a party, or any corporation succeeding to the corporate trust business of the Warrant Agent or any new warrant agent shall be a successor warrant agent under this Agreement without any further act, provided that such corporation is eligible for appointment as successor to the Warrant Agent under the provisions of the preceding paragrah. Any such successor warrant agent shall promptly cause notice of its succession as warrant agent to be mailed to the Company and to the Registered Holders of each Warrant Certificate. (h) The Warrant Agent, its subsidiaries and affiliates, and any of its or their officers or directors, may buy and hold or sell Warrants or other securities of the Company and otherwise deal with the Company in the same manner and to the same extent and with like effect as though it were not Warrant Agent. Nothing herein shall preclude the Warrant Agent from acting in any other capacity for the Company or for any other legal entity. (i) The Warrant Agent shall retain for a period of two years from the date of exercise any Warrant Certificate received by it upon such exercise. SECTION 11. MODIFICATION OF AGREEMENT. The Warrant Agent and the Company may by supplemental agreement make any changes or corrections in this Agreement (i) that they shall deem appropriate to cure any ambiguity or to correct any defective or inconsistent provision or manifest mistake or error herein contained; or (ii) that they may deem necessary or desirable and which shall not adversely affect the interests of the holders of Warrant Certificates; PROVIDED, HOWEVER, that no change in the number or nature of the securities purchasable upon the exercise of any Warrant, or to increase the Purchase Price therefor or to accelerate the Warrant Expiration Date, shall be made without the consent in writing of the Registered Holders representing not less than 66-2/3% of the Warrants then outstanding, other than such changes as are presently specifically prescribed by this Agreement as originally executed. In addition, this Agreement may not be modified, amended or supplemented without the prior written consent of the Representative, other than to cure any ambiguity or to correct any provision which is inconsistent with any other provision of this Agreement or to make any such change that is necessary or desirable and which shall not adversely affect the interests of the Representatives and except as may be required by law. 15 SECTION 12. NOTICES. All notices, requests, consents and other communications hereunder shall be in writing and shall be deemed to have been made when delivered or mailed first-class registered or certified mail, postage prepaid, as follows: if to the Registered Holder of a Warrant Certificate, at the address of such holder as shown on the registry books maintained by the Warrant Agent; if to the Company at 6646 Indian School Road, N.E., Albuquerque, New Mexico 87110, Attn: Howard P. Silverman, or at such other address as may have been furnished to the Warrant Agent in writing by the Company; and if to the Warrant Agent, at its Corporate Office. Copies of any notice delivered pursuant to this Agreement shall also be delivered to the Representatives c/o West America Securities Corp., 4510 East Thousand Oaks Boulevard, Suite 100, Westlake Village, CA 91362, Attention: General Counsel, or at such other address as may have been furnished to the Company and the Warrant Agent in writing. SECTION 13. GOVERNING LAW. This Agreement shall be governed by and construed in accordance with the laws of the State of Nevada without giving effect to conflicts of laws. SECTION 14. BINDING EFFECT. This Agreement shall be binding upon and inure to the benefit of the Company, the Warrant Agent and their respective successors and assigns and the holders from time to time of Warrant Certificates or any of them. Nothing in this Agreement is intended or shall be construed to confer upon any other person any right, remedy or claim, in equity or at law, or to impose upon any other person any duty, liability or obligation. SECTION 15. TERMINATION. This Agreement shall terminate at the close of business on the Expiration Date of all of the Warrants or such earlier date upon which all Warrants have been exercised or redeemed, except that the Warrant Agent shall account to the Company for cash held by it and the provisions of Section 10 hereof shall survive such termination. SECTION 16. COUNTERPARTS. This Agreement may be executed in several counterparts, which taken together shall constitute a single document. 16 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first above written. [SEAL] LASIK AMERICA, INC. By: ----------------------------- Name: Howard P. Silverman Title: Chief Executive Off. Attest: By: ------------------------------ Name: Title: CORPORATE STOCK TRANSFER As Warrant Agent By: ---------------------------- Name: Title: 17 EXHIBIT A No. W___ VOID AFTER _______, 2005 ______________ WARRANTS REDEEMABLE WARRANT CERTIFICATE TO PURCHASE ONE SHARE OF COMMON STOCK LASIK AMERICA, INC. CUSIP_____ THIS CERTIFIES THAT, FOR VALUE RECEIVED ______________ or registered assigns (the "Registered Holder") is the owner of the number of Redeemable Warrants (the "Warrants") specified above. Each Warrant initially entitles the Registered Holder to purchase, subject to the terms and conditions set forth in this Certificate and the Warrant Agreement (as hereinafter defined), one fully paid and nonassessable share of Common Stock of LASIK America, Inc., a Nevada corporation (the "Company"), at any time between _____________, 2002 (the "Initial Warrant Exercise Date"), and the Expiration Date (as hereinafter defined) upon the presentation and surrender of this Warrant Certificate with the Subscription Form on the reverse hereof duly executed, at the corporate office of Corporate Stock Transfer, as Warrant Agent, or its successor (the "Warrant Agent"), accompanied by payment of $9.00 subject to adjustment (the "Purchase Price"), in lawful money of the United States of America in cash or by check made payable to the Warrant Agent for the account of the Company. This Warrant Certificate and each Warrant represented hereby are issued pursuant to and are subject in all respects to the terms and conditions set forth in the Warrant Agreement (the "Warrant Agreement"), dated ________, 2002, between the Company and the Warrant Agent. In the event of certain contingencies provided for in the Warrant Agreement, the Purchase Price and the number of shares of Common Stock subject to purchase upon the exercise of each Warrant represented hereby are subject to modification or adjustment. Each Warrant represented hereby is exercisable at the option of the Registered Holder, but no fractional interests will be issued. In the case of the exercise of less than all the Warrants represented hereby, the Company shall cancel this Warrant Certificate upon the surrender hereof and shall execute and deliver a new Warrant Certificate or Warrant Certificates of like tenor, which the Warrant Agent shall countersign, for the balance of such Warrants. The term "Expiration Date" shall mean 5:30 p.m. (New York time) on the date which is forty-eight (48) months after the Initial Warrant Exercise Date. If each such date shall in the State of New York be a holiday or a day on which the banks are authorized to close, then the expiration Date shall mean 5:30 p.m. (New York time) on the next following day which in the State of New York is not a holiday or a day on which banks are authorized to close. The Company shall not be obligated to deliver any securities pursuant to the exercise of this Warrant unless a registration statement under the Securities Act of 1933, as amended (the "Act"), with respect to such 18 securities is effective or an exemption thereunder is available. The Company has covenanted and agreed that it will file a registration statement under the Federal securities laws, use its best efforts to cause the same to become effective, use its best efforts to keep such registration statement current, if required under the Act, while any of the Warrants are outstanding, and deliver a prospectus which complies with Section 10(a)(3) of the Act to the Registered Holder exercising this Warrant. This Warrant shall not be exercisable by a Registered Holder in any state where such exercise would be unlawful. This Warrant Certificate is exchangeable, upon the surrender hereof by the Registered Holder at the corporate office of the Warrant Agent, for a new Warrant Certificate or Warrant Certificates of like tenor representing an equal aggregate number of Warrants, each of such new Warrant Certificates to represent such number of Warrants as shall be designated by such Registered Holder at the time of such surrender. Upon due presentment and payment of any tax or other charge imposed in connection therewith or incident thereto, for registration of transfer of this Warrant Certificate at such office, a new Warrant Certificate or Warrant Certificates representing an equal aggregate number of Warrants will be issued to the transferee in exchange therefor, subject to the limitations provided in the Warrant Agreement. Prior to the exercise of any Warrant represented hereby, the Registered Holder shall not be entitled to any rights of a stockholder of the Company, including, without limitation, the right to vote or to receive dividends or other distributions, and shall not be entitled to receive any notice of any proceedings of the Company, except as provided in the Warrant Agreement. Subject to the provisions of the Warrant Agreement, this Warrant may be redeemed at the option of the Company, at a redemption price of $0.10 per Warrant, at any time commencing after ________, 2002, provided that the average closing sale price for the Common Stock as reported by Amex (or the closing bid price, if the Common Stock is then traded on Nasdaq), shall have equaled or exceeded $16.00 per share for any twenty (20) trading days within a period of thirty (30) consecutive trading days ending on the fifth trading day prior to the Notice of Redemption, as defined below (subject to adjustment in the event of any stock splits or other similar events). Notice of redemption (the "Notice of Redemption") shall be given not later than the thirtieth day before the date fixed for redemption, all as provided in the Warrant Agreement. On and after the date fixed for redemption, the Registered Holder shall have no rights with respect to the Warrants except to receive the $.10 per Warrant upon surrender of this Warrant Certificate. Prior to due presentment for registration of transfer hereof, the Company and the Warrant Agent may deem and treat the Registered Holder as the absolute owner hereof and of each Warrant represented hereby (notwithstanding any notations of ownership or writing hereon made by anyone other than a duly authorized officer of the Company or the Warrant Agent) for all purposes and shall not be affected by any notice to the contrary, except as provided in the Warrant Agreement. This Warrant Certificate shall be governed by and construed in accordance with the laws of the State of New York without giving effect to conflicts of laws. 19 This Warrant Certificate is not valid unless countersigned by the Warrant Agent. IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to be duly executed, manually or in facsimile by two of its officers thereunto duly authorized and a facsimile of its corporate seal to be imprinted hereon. Dated: LASIK AMERICA, INC. [SEAL] By: ---------------------------- Name: Title: COUNTERSIGNED: CORPORATE STOCK TRANSFER as Warrant Agent By: ----------------------------------------------- Authorized Officer 20 SUBSCRIPTION FORM To Be Executed by the Registered Holder in Order to Exercise Warrants The undersigned Registered Holder hereby irrevocably elects to exercise Warrants represented by this Warrant Certificate, and to purchase the securities issuable upon the exercise of such Warrants, and requests that certificates for such securities shall be issued in the name of PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER -------------------------------- -------------------------------- -------------------------------- (please print or type name and address) and be delivered to -------------------------------- -------------------------------- -------------------------------- (please print or type name and address) and if such number of Warrants shall not be all the Warrants evidenced by this Warrant Certificate, that a new Warrant Certificate for the balance of such Warrants be registered in the name of, and delivered to, the Registered Holder at the address stated below. Dated: X -------------------- -------------------- -------------------- -------------------- Address -------------------- Social Security or Taxpayer Identification Number ------------------- Signature Guaranteed 21 ASSIGNMENT To Be Executed by the Registered Holder in Order to Assign Warrants FOR VALUE RECEIVED,_______________________, hereby sells, assigns and transfers unto PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER ------------------------------ ------------------------------ ------------------------------ ------------------------------ ------------------------------ (please print or type name and address) ___________________ of the Warrants represented by this Warrant Certificate, and ereby irrevocably constitutes and appoints _____________________ Attorney to ransfer this Warrant Certificate on the books of the Company, with full power of substitution in the premises. Dated: X -------------------------- -------------------- Signature Guaranteed THE SIGNATURE TO THE ASSIGNMENT OR THE SUBSCRIPTION FORM MUST CORRESPOND TO THE AME AS WRITTEN UPON THE FACE OF THIS WARRANT CERTIFICATE IN EVERY PARTICULAR, ITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATSOEVER AND MUST BE UARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (BANKS, STOCKBROKERS, SAVINGS ND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED SIGNATURE UARANTEE MEDALLION PROGRAM), PURSUANT TO S.E.C. RULE 17Ad-15. 22 EX-3.1 4 file003.txt ARTICLES OF INCORPORATION Exhibit 3.1 ----------- Articles of Incorporation FILED # C7147-01 ------------------------- -------- of MAR 2 1 2001 -- LASIK AMERICA INC. IN THE OFFICE OF ------------------ DEAN HELLER SECRETARY OF STATE FIRST. The name of the corporation is: ------ LASIK AMERICA, INC. SECOND. Its principle office in the State of Nevada is located at 251 ------- Jeanell Dr. Suite 3, Carson City, NV 89703, although this Corporation may maintain an office, or offices, in such other place within or without the state of Nevada as may from time to time be designated by the Board of Directors, or by the by-laws of said Corporation, and that this Corporation may conduct all Corporation business of every kind and nature, including the holding of all meetings of Directors and Stockholders, outside the State of Nevada as well as within the State of Nevada. THIRD. The objects for which this Corporation is formed are: To ------ engage in any lawful activity, including, but not limited to the following: (A) Shall have such rights, privileges and powers as may be conferred upon corporations by any existing law. (B) May at any time exercise such rights, privileges and powers, when not inconsistent with the purposes and objects for which this corporation is organized. (C) Shall have power to have succession by its corporate name for the period limited in its certificate or articles of incorporation, and when no period is limited, perpetually, or until dissolved and its affairs wound up according to law. (D) Shall have power to sue and be sued in any court of law or equity. (E) Shall have power to make contracts. (F) Shall have power to hold, purchase and convey real and personal estate and to mortgage or lease any such real and personal estate with its franchises. The power to hold real and personal estate shall include the power to take the same devise or bequest in the State of Nevada, or any other state, territory or country. (G) Shall have power to appoint such officers and agents as the affairs of the corporation shall require, and to allow them suitable compensation. (H) Shall have power to make by-laws not inconsistent with the constitution of the United States, or of the State of Nevada, for the management, regulation and government of its affairs and property, the transfer of its stock, the transaction of its business, and the calling and holding of meetings of its stockholders. (I) Shall have power to wind up and dissolve itself, or be wound up or dissolved. (J) Shall have power to adopt and use a common seal or stamp by the corporation on any corporate documents is not necessary. The corporation may use 1 a seal or stamp, if it desires, but such non-use shall not in any way affect the legality of the document. (K) Shall have power to borrow money and contract debts when necessary for the transaction of its business, or for the exercise of its corporate rights, privileges or franchises, or for any other lawful purpose of its incorporation; to issue bonds, promissory notes, bills of exchange, debentures, and other obligations and evidences of indebtedness, payable upon the happening of a specified event or events, whether secured by mortgage, pledge, or otherwise, or unsecured, for money borrowed, or in payment for property purchased, or acquired, or for any other lawful object. (L) Shall have power to guarantee, purchase, hold, sell, assign, transfer, mortgage, pledge or otherwise dispose of the shares of the capital stock, or any bonds, securities or evidences of the indebtedness created by, any other corporation or corporations of the State of Nevada, or any other state or government, and while owners of such stock, bonds, securities or evidences of indebtedness, to exercise all the rights, powers and privileges of ownership, including the right to vote, if any. (M) Shall have power to purchase, hold, sell and transfer shares of its own capital stock, and use therefore its capital, capital surplus, surplus, or other property or fund. (N) Shall have power to conduct business, have one or more offices, and hold, purchase, mortgage and convey real and personal property in the State of Nevada, and in any of the states, territories, possessions and dependencies of the United States, the District of Columbia, and any foreign countries. (O) Shall have power to do all and everything necessary and proper for the accomplishment of the objects enumerated in its certificate or articles of incorporation, or any amendment thereof, or necessary or incidental to the protection and benefit of the corporation, and, in general, to carry on any lawful business necessary or incidental to the attainment of the objects of the corporation, or any amendment thereof. (P) Shall have the power to make donations for the public welfare or for charitable, scientific or educational purposes. (Q) Shall have the power to enter into partnerships, general or limited, or joint ventures, in connection with any lawful activities. FOURTH. That the voting common stock authorized that may be issued by ------- the corporation is TWENTY FIVE MILLION (25,000,000) shares with a nominal or par value of .001 and ONE HUNDRED THOUSAND (100,000) shares of preferred stock with a par value of .001 and no other class of stock shall be authorized. Said shares with a nominal or par value may be issued by the corporation from time to time for such considerations as may be fixed from time to time by the Board of Directors. FIFTH. The governing body of the corporation shall be known as ------ directors, and the number of directors may from time to time be increased or decreased in such manner as shall be provided by the By-Laws of this Corporation, providing that the number of directors shall be reduced to no less than one (1). The name and post office address of the first board of Directors shall be one (1) in number and listed as follows: 2 NAME POST OFFICE ADDRESS Sara A. Zaro 251 Jeanell Dr. Suite 3 Carson City, NV 89703 SIXTH. The capital stock, after the amount of the subscription price, ------ or par value, has been paid in, shall not be subject to assessment to pay the debts of the corporation. SEVENTH. The name and post office address of the incorporator(s) ------- signing the Articles of Incorporation is as follows: NAME ADDRESS Sara A. Zaro 251 Jeanell Dr. Suite 3 Carson City, Nevada 89703 EIGHTH. The resident agent for this corporation shall be: ------ CORPORATE ADVISORY SERVICE, INC. The address of said agent, and, the principle or statutory address of this corporation in the State of Nevada is. 251 Jeanell Dr. Suite 3, Carson City, Nevada 89703 NINTH. The corporation is to have perpetual existence. ------ TENTH. In furtherance and not in limitation of the powers conferred by ------ statute, the Board of Directors is expressly authorized: Subject to the By-Laws, if any, adopted by the stockholders,to make, alter or amend the By-Laws of the Corporation. To fix the amount to be reserved as working capital over and above its capital stock paid in; to authorize and cause to be executed, mortgages and liens upon the real and personal property of this corporation. By resolution passed by a majority of the whole Board, to consist of one (1) or more committees, each committee to consist of one or more directors of the corporation, which, to the extent provided in the resolution, or in the By-Laws of the Corporation, shall have and may exercise the powers of the Board of Directors in the management of the business and affairs of the Corporation. Such committee, or committees, shall have such name, or names, as may be stated in the By-Laws of the Corporation, or as may be determined from time to time by resolution adopted by the Board of Directors. When and as authorized by the affirmative vote of the Stockholders holding stock entitling them to exercise at least a majority of the voting power given at a Stockholders meeting called for the purpose, or when authorized by written consent of the holders of at least a majority of the voting stock issued and outstanding, the Board of Directors shall have power and authority at any meeting to sell, lease or exchange all of the property and assets of the Corporation, including its good will and its corporate franchises, upon such 3 terms and conditions as its Board of Directors deems expedient and for the best interests of the Corporation. ELEVENTH. No shareholder shall be entitled as a matter of right to --------- subscribe for, or receive additional shares of any class of stock of the Corporation, whether now or hereafter authorized, or any bonds, debentures or securities convertible into stock may be issued or disposed of by the Board of Directors to such persons and on such terms as is in its discretion it shall deem advisable. TWELFTH. No director or officer of the Corporation shall be personally -------- liable to the Corporation or any of its stockholders for damages for breach of fiduciary duty as a director or officer involving any act of omission of any such director or officer; provided, however, that the foregoing provision shall not eliminate or limit the liability of a director or officer (i) for acts or omissions which involve intentional misconduct, fraud or a knowing violation of the law, or (ii) the payment of dividends in violation of Section 78.300 of the Nevada Revised Statutes. Any repeal or modification of this Article by the stockholders of the Corporation shall be prospective only, and shall not adversely affect any limitation on the personal liability of a director or officer of the Corporation for acts or omissions prior to such repeal or modification. THIRTEENTH. This Corporation reserves the right to amend, alter, ----------- change, in any manner now or hereafter prescribed by statute, or by the Articles of Incorporation, and all rights conferred upon Stockholders herein are granted subject to this reservation. I, THE UNDERSIGNED, being the Incorporator Herein before named for the purpose of forming a Corporation pursuant to the General Corporation Law of the State of Nevada, do make and file these Articles of Incorporation, hereby declaring and certifying that the facts herein are true, and accordingly have hereunto set my hand this 21st day of March, 2001. /s/ Sara Zaro --------------- Sara A. Zaro Corporate Advisory Service, Inc. does hereby accept as Resident Agent for the previously named Corporation. Corporate Advisory Service, Inc. /s/ Sara Zaro 3/21/01 - ------------------------------- ----------------- By Sara A. Zaro, Vice President Date 4 EX-3.2 5 file004.txt BY-LAWS Exhibit 3.2 ----------- LASIK AMERICA, INC. ------------------- By-Laws ------- ARTICLE I MEETINGS OF STOCKHOLDERS - ------------------------------------- 1. Stockholders meetings shall be held in the office of the Corporation, at Carson City, NV, or at such other place or places as the directors shall from time to time determine. 2. The annual meeting of the Stockholders of this Corporation shall be held at 11 A.M., on the 21st day of March of each year beginning in 2002, at which time there shall be elected by the Stockholders of the Corporation a Board of Directors for the ensuing year, and the Stockholders shall transact such other business as shall properly come before them. 3. A notice setting out the time and place of such annual meeting shall be mailed postage prepaid to each of the Stockholders of record, at his address and as the same appears on the stock book of the company, or if no such address appears, at his last known place of business, at least ten (10) days prior to the annual meeting. 4. If a quorum is not present at the annual meeting, the Stockholders present, in person or by proxy, may adjourn to such future time as shall be agreed upon by them, and notice of such adjournment shall be mailed, postage prepaid, to each Stockholder of record at least ten (10) days before such date to which the meeting was adjourned; but if a quorum is present, they may adjourn from day to day as they see fit, and no notice of such adjournment need be given. 5. Special meetings of the Stockholders may be called at any time by the President; by all of the Directors provided there are no more than three, or if more than three, by any three Directors; or by the holder of a majority share of the capital stock of the Corporation. The Secretary shall send a notice of such called meeting to each Stockholder of record at least ten (10) days before such meeting, and such notice shall state the time and place of the meeting, and the object thereof. No business shall be transacted at a special meeting except as stated in the notice to the Stockholders, unless by unanimous consent of all the Stockholders present, either in person or by proxy, all such stock being represented at the meeting. 6. A majority of the stock issued and outstanding, either in person or by proxy, shall constitute a quorum for the transaction of business at any meeting of the Stockholders. 7. Each Stockholder shall be entitled to one vote for each share of stock in his own name on the books of the company, whether represented in person or by proxy. 1 8. All proxies shall be in writing and signed. 9. The following order of business shall be observed at all of the Stockholders so far as is practicable: a. Call the roll; b. Reading, correcting, and approving of the minutes of the previous meeting; c. Reports of Officers; d. Reports of Committees; e. Election of Directors; f. Unfinished business; and g. New business. ARTICLE II STOCK - ------------------ 1. Certificates of stock shall be in a form adopted by the Board of Directors and shall be signed by the President and Secretary of the Corporation. 2. All certificates shall be consecutively numbered; the name of the person owning the shares represented thereby, with the number of shares and the date of issue shall be entered on the company's books. 3. All certificates of stock transferred by endorsement thereon shall be surrendered by cancellation and new certificates issued to the purchaser or assignee. ARTICLE III DIRECTORS - ---------------------- 1. A Board of Directors, consisting of at least one (1) person shall be chosen annually by the Stockholders at their meeting to manage the affairs of the company. The Directors' term of office shall be one year, and Directors may be re-elected for successive annual terms. 2. Vacancies on the Board of Directors by reason of death, resignation or other causes shall be filled by the remaining Director or Directors choosing a Director or Directors to fill the unexpired term. 3. Regular meetings of the Board of Directors shall be held at 1 P.M., on the 21st day of March of each year beginning in 2002 at the office of the company at Carson City, NV, or at such other time or place as the Board of Directors shall by resolution appoint; special meetings may be called by the President or any Director giving ten (10) days notice to each Director. Special meetings may also be called by execution of the appropriate waiver of notice and call when executed by a majority of the Directors of the company. A majority of the Directors shall constitute a quorum. 4. The Directors have the general management and control of the business and affairs of the company and shall exercise all the powers that may be exercised or performed by the Corporation, under the statutes, the Articles of Incorporation, and the By-Laws. Such management will be by equal vote of each member of the Board of Directors with each board member having an equal vote. 2 5. A resolution, in writing, signed by all or a majority of the members of the Board of Directors, shall constitute action by the Board of Directors to effect therein expressed, with the same force and effect as though such resolution has been passed at a duly convened meeting; and it shall be the duty of the Secretary to record every such resolution in the Minute Book of the Corporation under its proper date. ARTICLE IV OFFICERS - --------------------- 1. The officers of this company shall consist of: a President, one or more Vice President(s), Secretary, Treasurer, Resident Agent, and such other officers as shall, from time to time, be elected or appointed by the Board of Directors. 2. The PRESIDENT shall preside at all meetings of the Directors and the Stockholders and shall have general charge and control over the affairs of the Corporation subject to the Board of Directors. He shall sign or countersign all certificates, contracts and other instruments of the Corporation as authorized by the Board of Directors and shall perform all such other duties as are incident to his office or are required by him by the Board of Directors. 3. The VICE PRESIDENT shall exercise the functions of the President during the absence or disability of the President and shall have such powers and such duties as may be assigned to him from time to time by the Board of Directors. 4. The SECRETARY shall issue notices for all meetings as required by the By-Laws, shall keep a record of the minutes of the proceedings of the meetings of the Stockholders and Directors, shall have charge of the corporate books, and shall make such reports and perform such other duties as are incident to his office, or properly required of him by the Board of Directors. He shall be responsible that the corporation complies with Section 78.105 of the Nevada Corporation laws and supplies to the Nevada Resident Agent or Registered Office in Nevada, and maintain, any and all amendments or changes to the By-Laws of the Corporation. In compliance with Section 78.105, he will also supply to the Nevada Resident Agent or registered Office in Nevada, and maintain, a current statement setting out the name of the custodian of the stock ledger or duplicate stock ledger, and the present and complete Post Office address, including street and number, if any, where such stock ledger or duplicate stock ledger specified in the section is kept. 5. The TREASURER shall have the custody of all monies and securities of the Corporation and shall keep regular books of account. He shall disburse the funds of the Corporation in payment of the just demands against the Corporation, or as may be ordered by the Board of Directors, making proper vouchers for such disbursements and shall render to the Board of Directors, from time to time, as may be required of him, an account of all his transactions as Treasurer and of the financial condition of the Corporation. He shall perform all duties incident to his office or which are properly required of him by the Board of Directors. 6. The RESIDENT AGENT shall be in charge of the Corporation's registered office in the State of Nevada, upon whom process against the 3 Corporation may be served and shall perform all duties required of him by statute. 7. The salaries of all offices shall be fixed by the Board of Directors and may be changed from time to time by a majority vote of the board. 8. Each such officer shall serve for a term of one (1) year or until their successors are chosen and qualified. Officers may be re-elected or appointed for successive annual terms. 9. The Board of Directors may appoint such other officers and agents, as it shall deem necessary or expedient, who shall hold their offices for such terms and shall exercise such powers and perform such duties as shall be determined from time to time by the Board of Directors. ARTICLE V INDEMNIFICATION OF OFFICERS AND DIRECTORS - ---------------------------------------------------- 1. The Corporation shall indemnify any and all of its Directors and Officers, and its former Directors and Officers, or any person who may have served at the Corporations request as a Director or Officer of another Corporation in which it owns shares of capital stock or of which it is a creditor, against expenses actually and necessarily incurred by them in connection with the defense of any action, suit or proceeding in which they, or any of them, are made parties, or a party, by reason of being or having been Director(s) or Officer(s) of the Corporation, or of such other Corporation, except, in relation to matters as to which any such director or officer or former Director or Officer or person shall be adjudged in such action, suit or proceeding to be liable for negligence or misconduct in the performance of duty. Such indemnification shall not be deemed exclusive of any other rights to which those indemnified may be entitled, under By-Law, agreement, vote of Stockholders or otherwise. ARTICLE VI AMENDMENTS - ------------------------- 1. Any of these By-Laws may be amended by a majority vote of the Stockholders at any meeting or at any special meeting called for that purpose. 2. The Board of Directors may amend the By-Laws or adopt additional By-Laws, but shall not alter or repeal any By-Law adopted by the Stockholders of the company. ******************************************************************************** CERTIFIED TO BE THE BY-LAWS OF: LASIK AMERICA, INC. BY: /s/ ---------------------------------- Secretary 4 EX-4.1 6 file005.txt SPECIMEN OF COMMON STOCK CERTIFICATE Exhibit 4.1 ----------- Specimen of Common Stock Certificate 1 EX-10.0 7 file006.txt WARRANT AGREEMENT Exhibit 10.0 ------------ WARRANT AGREEMENT WARRANT AGREEMENT, dated as of August 24, 2001, between LASIK America, Inc., a Nevada corporation (the "Company"), and Dr. Howard P. Silverman, the Chief Executive Officer and President of the Company ("Silverman"). W I T N E S S E T H: 1. Issue. The Company shall issue to Silverman a certificate (the "Warrant Certificate") dated as of the date hereof providing Silverman, and any subsequent assignee or transferee of Silverman, with the right to purchase, at any time, commencing six months after the date that the Company's registration statement filed on Form SB-2 with the U.S. Securities and Exchange Commission becomes effective ("Effective Date"), until 5:30 p.m., New York time, five (5) years from the Effective Date, 125,000 shares of Common Shares of the Company (the "Warrant Shares") (subject to adjustment as provided in Section 10 hereof), at an exercise price (subject to adjustment as provided in Section 10 hereof) of $7.20 per Common Share. 2. Warrant Certificate. The Warrant Certificate to be delivered pursuant to this Agreement shall be in the form set forth as an Exhibit, attached hereto and made a part hereof, with such appropriate insertions, omissions, substitutions and other variations as are required or permitted by this Agreement. 3. Exercisability of Warrants. The Warrants shall be exercisable at any time commencing six months after the Effective Date, until 5:30 p.m., New York time, five (5) years after the Effective Date. 4. Procedure for Exercise of Warrants. 4.1 Cash Exercise. The Warrants are exercisable at an aggregate initial exercise price per Common Share set forth in Section 8 hereof payable by certified check or official bank check in New York Clearing House funds. Upon surrender of a Warrant Certificate with the annexed Form of Election to Purchase duly executed, together with payment of the Exercise Price (as hereinafter defined) for the Warrant Shares purchased, at the Company's principal offices in Albuquerque, New Mexico (presently located at 6646 Indian School Road, N.E., Albuquerque, New Mexico), Silverman shall be entitled to receive a certificate for the Warrant Shares so purchased. The purchase rights represented by the Warrant Certificate are exercisable at the option of Silverman, in whole or in part (but not as to fractional Common Shares underlying the Warrants). In the case of the purchase of less than all the Warrant Shares purchasable under the Warrant Certificate, the Company shall cancel said Warrant Certificate upon the surrender thereof and shall execute and deliver a new Warrant Certificate of like tenor for the balance of the Warrant Shares purchasable thereunder. 4.2 Cashless Exercise. In addition to the exercise of all or a portion of the Warrants by the payment of the Exercise Price in cash or check as set forth in Section 4.1 above, and in lieu of any such payment, Silverman has the right to exercise the Warrants, in full or in part, by surrendering the Warrant Certificate with the annexed Form 1 of Election to Purchase duly executed, in exchange for the number of Common Shares equal to the product of (x) the number of Common Shares as to which the Warrants are being exercised multiplied by (y) a fraction, the numerator of which is the Current Market Price of the Common Shares (as defined below) less the Exercise Price then in effect and the denominator of which is the Current Market Price. 4.3 Current Market Price. The term "Current Market Price" shall mean (i) if the Shares are traded in the over-the-counter market or on the National Association of Securities Dealers, Inc. Automated Quotations System ("NASDAQ"), the average per Share closing bid prices on the 20 consecutive trading days immediately preceding the date of exercise, as reported by NASDAQ or an equivalent generally accepted reporting service, or (ii) if the Shares are traded on a national securities exchange, the average for the 20 consecutive trading days immediately preceding the exercise date of the daily per Share closing prices on the principal stock exchange on which the Shares are listed, as the case may be. The closing price referred to in clause (ii) above shall be the last reported sales price or, if no such reported sale takes place on such day, the average of the reported closing bid and asked prices, in either case on the national securities exchange on which the Shares are then listed. 5. Issuance of Certificate. Upon the exercise of the Warrants, the issuance of a certificate for Warrant Shares (or Other Securities) shall be made forthwith (and in any event within five (5) business days thereafter) without charge to Silverman including, without limitation, any tax which may be payable in respect of the issuance thereof, and such certificate shall (subject to the provisions of Sections 6 and 9 hereof) be issued in the name of, or in such names as may be directed by Silverman; provided, however, that the Company shall not be required to pay any tax which may be payable in respect of any transfer involved in the issuance and delivery of any such certificate in a name other than that of Silverman and the Company shall not be required to issue or deliver such certificate unless or until the person or persons requesting the issuance thereof shall have paid to the Company the amount of such tax or shall have established to the satisfaction of the Company that such tax has been paid. The Warrant Certificate and the certificate representing the Warrant Shares (or Other Securities) shall be executed on behalf of the Company by the manual or facsimile signature of the then present Chairman or Vice Chairman of the Board of Directors or President or any Vice President of the Company under its corporate seal reproduced thereon, attested to by the manual or facsimile signature of the then present Secretary or any Assistant Secretary of the Company. The Warrant Certificate shall be dated the date of execution by the Company upon initial issuance, division, exchange, substitution or transfer. 6. Transfer of Warrants. Silverman, by his acceptance hereof, covenants and agrees that the Warrants are being acquired as an investment and not with a view to the distribution thereof. The Warrants may be sold, transferred, assigned, hypothecated or otherwise disposed of, in whole or in part, without restriction, subject to compliance with applicable securities laws. 7. Redemption of Warrant. 7.1 Commencing on the date which is six months after the Effective Date, Redemption Date, the Company may, on 30 days' prior 2 written notice, redeem all the Warrants at ten cents ($.10) per Warrant, PROVIDED, HOWEVER, that before any such call for redemption of Warrants can take place, the average closing bid price for the Common Stock as reported by the Over-the-Counter Electronic Bulletin Board maintained by the NASD, if the Common Stock is not then traded on any national securities exchange shall have equaled or exceeded $9.00 per share for any twenty (20) trading days prior to the date on which the notice contemplated by (b) and (c) below is given (subject to adjustment in the event of any stock splits or other similar events as provided in Section 9 hereof). 7.2 In case the Company shall exercise its right to redeem all of the Warrants, it shall give or cause to be given notice to the Registered Holders of the Warrants, by mailing to such Registered Holders a notice of redemption, first class, postage prepaid, at their last address as shall appear on the records of the Warrant Agent. Any notice mailed in the manner provided here shall be conclusively presumed to have been duly given whether or not the Registered Holder receives such notice. Not less than four (4) trading days prior to the mailing to the Registered Holders of the Warrants of the notice of redemption, the Company shall deliver or cause to be delivered to the representative of the underwriters, a similar notice telephonically and confirmed in writing together with a list of the Registered Holders (including their respective addresses and number of Warrants beneficially owned) to whom such notice of redemption has been or will be given. 7.3 The notice of redemption shall specify (i) the redemption price, (ii) the Redemption Date, which shall in no event be less than thirty (30) days after the date of mailing of such notice, (iii) the place where the Warrant Certificate shall be delivered and the redemption price shall be paid, and (iv) that the right to exercise the Warrant shall terminate at 5:30 p.m. (New York time) on the business day immediately preceding the date fixed for redemption. No failure to mail such notice nor any defect therein or in the mailing thereof shall affect the validity of the proceedings for such redemption except as to a holder (a) to whom notice was not mailed or (b) whose notice was defective. An affidavit of the Warrant Agent or the Secretary or Assistant Secretary of the Company that notice of redemption has been mailed shall, in the absence of fraud, be prima facie evidence of the facts stated therein. 7.4 Any right to exercise a Warrant shall terminate at 5:30 p.m. (New York time) on the business day immediately preceding the Redemption Date. The redemption price payable to the Registered Holders shall be mailed to such persons at their addresses of record. 8. Exercise Price. 8.1 Initial and Adjusted Exercise Price. Except as otherwise provided in Section 9 hereof, the initial exercise price of each 3 Warrant shall be the price set forth in Section 1 hereof per Warrant Share issued hereunder. The adjusted exercise price shall be the price which shall result from time to time from any and all adjustments of the initial exercise price in accordance with the provisions of Section 9 hereof. 8.2 Exercise Price. The term "Exercise Price" herein shall mean the initial exercise price or the adjusted exercise price, depending upon the context. 9. Registration Under the Securities Act of 1933. As of the date hereof, the Warrants, the Warrant Shares and any of the other securities issuable upon exercise of the Warrants have not been registered under the Securities Act of 1933, as amended (the "Act"). Upon exercise, in whole or in part, of the Warrants, a certificate representing the Warrant Shares underlying the Warrants, and any of the other securities issuable upon exercise of the Warrants (collectively, the "Warrant Securities") shall bear the following legend unless such Warrant Shares previously have been registered under the Act in accordance with the terms hereof: THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED ("ACT"), AND MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO (i) AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT, (ii) TO THE EXTENT APPLICABLE, RULE 144 UNDER THE ACT (OR ANY SIMILAR RULE UNDER THE ACT RELATING TO THE DISPOSITION OF SECURITIES), OR (iii) AN OPINION OF COUNSEL, IF SUCH OPINION SHALL BE REASONABLY SATISFACTORY TO COUNSEL TO THE ISSUER, THAT AN EXEMPTION FROM REGISTRATION UNDER THE ACT IS AVAILABLE. 10. Adjustments to Exercise Price and Number of Securities. The Exercise Price and, in some cases, the number of Warrant Shares purchasable upon the exercise of the Warrants, shall be subject to adjustment from time to time upon the occurrence of certain events described in this Section 10. 10.1 Subdivision or Combination of Common Shares and Common Share Dividend. In case the Company shall at any time subdivide its outstanding Common Shares into a greater number of Common Shares or declare a dividend upon its Common Shares payable solely in Common Shares, the Exercise Price in effect immediately prior to such subdivision or declaration shall be proportionately reduced, and the number of Warrant Shares issuable upon exercise of the Warrants shall be proportionately increased. Conversely, in case the outstanding Common Shares of the Company shall be combined into a smaller number of Common Shares, the Exercise Price in effect immediately prior to such combination shall be proportionately increased, and the number of Warrant Shares issuable upon exercise of the Warrants shall be proportionately reduced. 10.2 Notice of Adjustment. Promptly after adjustment of the Exercise Price or any increase or decrease in the number of Warrant Shares purchasable upon the exercise of this Warrant, the Company shall give written notice thereof, by first class mail, postage prepaid, addressed to Silverman of this Warrant at the address shown on the books of the Company. The notice shall be signed by the Company's chief financial officer and shall state (i) the effective date of the adjustment and the Exercise Price resulting from such adjustment and 4 (ii) the increase or decrease, if any, in the number of Common Shares purchasable at such price upon the exercise of this Warrant, setting forth in reasonable detail the method of calculation and the facts upon which such calculation is based. 10.3 Other Notices. If at any time: (a) the Company shall declare any cash dividend upon its Common Shares; (b) the Company shall declare any dividend upon its Common Shares payable in securities (other than a dividend payable solely in Common Shares) or make any special dividend or other distribution to Silverman of its Common Shares; (c) there shall be any consolidation or merger of the Company with another corporation, or a sale of all or substantially all of the Company's assets to another corporation; or (d) there shall be a voluntary or involuntary dissolution, liquidation or winding-up of the Company; then, in any one or more of said cases, the Company shall give, by certified or registered mail, postage prepaid, addressed to Silverman of this Warrant at the address of Silverman as shown on the books of the Company, (i) at least 15 days' prior written notice of the date on which the books of the Company shall close or a record shall be taken for such dividend, distribution or subscription rights or for determining rights to vote in respect of any such dissolution, liquidation or winding-up; (ii) at least 10 days' prior written notice of the date on which the books of the Company shall close or a record shall be taken for determining rights to vote in respect of any such reorganization, reclassification, consolidation, merger or sale, and (iii) in the case of any such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation or winding-up, at least 15 days' written notice of the date when the same shall take place. Any notice given in accordance with clause (i) above shall also specify, in the case of any such dividend, distribution or option rights, the date on which shall be entitled thereto. Any notice given in accordance with clause (iii) above shall also specify the date on which Silverman shall be entitled to exchange his Common Shares for securities or other property deliverable upon such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation or winding-up, as the case may be. If Silverman does not exercise this Warrant prior to the occurrence of an event described above, except as provided in Sections 10.1 and 10.5, then Silverman shall not be entitled to receive the benefits accruing to existing holders of the Common Shares in such event. 10.4 Changes in Common Shares. In case at any time the Company shall be a party to any transaction (including, without limitation, a merger, consolidation, sale of all or substantially all of the Company's assets or recapitalization of the Common Shares) in which the previously outstanding Common Shares shall be changed into or exchanged for different securities of the Company or common stock or other securities of another corporation or interests in a non-corporate entity or other property (including cash) or any combination of any of the foregoing (each such transaction being herein called the "Transaction" and the date of consummation of the Transaction being herein called the "Consummation Date"), then, as a condition of the consummation of the Transaction, lawful and adequate provisions shall be made so that Silverman, upon the exercise hereof at any time on or 5 after the Consummation Date, shall be entitled to receive, and this Warrant shall thereafter represent the right to receive, in lieu of the Common Shares issuable upon such exercise prior to the Consummation Date, the highest amount of securities or other property to which Silverman would actually have been entitled upon the consummation of the Transaction if Silverman had exercised such Warrant immediately prior thereto. The provisions of this Section 10.5 shall similarly apply to successive Transactions. 11. Exchange and Replacement of Warrant Certificate. The Warrant Certificate is exchangeable without expense, upon the surrender thereof by Silverman at the principal executive office of the Company, for a new Warrant Certificate of like tenor and date representing in the aggregate the right to purchase the same number of Warrant Shares in such denominations as shall be designated by Silverman thereof at the time of such surrender. Upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of the Warrant Certificate, and, in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it, and reimbursement to the Company of all reasonable expenses incidental thereto, and upon surrender and cancellation of the Warrants, if mutilated, the Company will make and deliver a new Warrant Certificate of like tenor, in lieu thereof. 12. Elimination of Fractional Interests. The Company shall not be required to issue certificates representing fractions of Common Shares upon the exercise of the Warrants, nor shall it be required to issue scrip or pay cash in lieu of fractional interests, it being the intent of the parties that all fractional interests shall be eliminated by rounding any fraction up to the nearest whole number of Common Shares or Other Securities. 13. Reservation of Securities. The Company shall at all times reserve and keep available out of its authorized Common Shares, solely for the purpose of issuance upon the exercise of the Warrants, such number of Common Shares or Other Securities as shall be issuable upon the exercise thereof. The Company covenants and agrees that, upon exercise of the Warrants and payment of the Exercise Price therefor, all Common Shares or Other Securities issuable upon such exercise shall be duly and validly issued, fully paid, non-assessable and not subject to the preemptive rights of any holder of Common Shares. 14. Notices to Warrant Holder. Nothing contained in this Agreement shall be construed as conferring upon the holder by virtue of his holding the Warrant the right to vote or to consent or to receive notice as a holder of Common Shares in respect of any meetings of such holders for the election of directors or any other matter, or as having any rights whatsoever as such a shareholder of the Company. 15. Notices. All notices, requests, consents and other communications hereunder shall be in writing and shall be deemed to have been duly made and sent when delivered, or mailed by registered or certified mail, return receipt requested: (a) If to Silverman, to the address of Silverman as shown on the books of the Company; or (b) If to the Company, to the address set forth in Section 4 hereof or to such other address as the Company may designate by notice to the Silverman. 6 16. Supplements and Amendments. The Company and Silverman may from time to time supplement or amend this Agreement in order to cure any ambiguity, to correct or supplement any provision contained herein which may be defective or inconsistent with any provisions herein, or to make any other provisions in regard to matters or questions arising hereunder which the Company and Silverman may deem necessary or desirable. 17. Successors. All the covenants and provisions of this Agreement shall be binding upon and inure to the benefit of the Company, Silverman and their respective successors and assigns hereunder. 18. Termination. This Agreement shall terminate at the close of business on the tenth anniversary of the issuance of the Warrants. 19. Governing Law. This Agreement and the Warrant Certificate issued hereunder shall be deemed to be a contract made under the laws of the State of Nevada and for all purposes shall be construed in accordance with the laws of the State of Nevada without giving effect to the rules of the State of Nevada governing the conflicts of laws. 20. Entire Agreement; Modification. This Agreement contains the entire understanding between the parties hereto with respect to the subject matter hereof and may not be modified or amended except by a writing duly signed by the party against whom enforcement of the modification or amendment is sought. 21. Severability. If any provision of this Agreement shall be held to be invalid or unenforceable, such invalidity or unenforceability shall not affect any other provision of this Agreement. 22. Captions. The caption headings of the Sections of this Agreement are for convenience of reference only and are not intended, nor should they be construed as, a part of this Agreement and shall be given no substantive effect. 23. Benefits of this Agreement. Nothing in this Agreement shall be construed to give to any person or corporation other than the Company and Silverman any legal or equitable right, remedy or claim under this Agreement; and this Agreement shall be for the sole and exclusive benefit of the Company and Silverman. 24. Counterparts. This Agreement may be executed in any number of counterparts and each of such counterparts shall for all purposes be deemed to be an original, and such counterparts shall together constitute but one and the same instrument. 7 IN WITNESS WHEREOF, the parties hereto have caused this Warrant Agreement to be duly executed, as of the day and year first above written. LASIK AMERICA, INC. By:_______________________________ Robert Helmer, Chief Operating Officer ACCEPTED AND AGREED TO: HOLDER - --------------------------------------- Name: Address: Social Security/Tax I.D. No.: Howard P. Silverman 8 [FORM OF WARRANT CERTIFICATE] THE WARRANTS REPRESENTED BY THIS CERTIFICATE AND THE OTHER SECURITIES ISSUABLE UPON EXERCISE THEREOF MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO (i) AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT") (ii) TO THE EXTENT APPLICABLE, RULE 144 UNDER THE ACT (OR ANY SIMILAR RULE UNDER THE ACT RELATING TO THE DISPOSITION OF SECURITIES), OR (iii) AN OPINION OF COUNSEL, IF SUCH OPINION SHALL BE REASONABLY SATISFACTORY TO COUNSEL FOR THE ISSUER, THAT AN EXEMPTION FROM REGISTRATION UNDER THE ACT IS AVAILABLE. EXERCISABLE FROM THE EFFECTIVE DATE UNTIL 5:30 P.M., NEW YORK TIME, FIVE YEARS (5) AFTER THE EFFECTIVE DATE. WARRANT CERTIFICATE This Warrant Certificate certifies that or his/her registered assigns ("Holder"), is the registered Holder of 125,000 Warrants to purchase initially at any time commencing six months after the Effective Date, until 5:30 p.m. New York time, five (5) years after the Effective Date ("Expiration Date"), up to 125,000 fully-paid and non-assessable shares of common stock, par value $.001 per share ("Common Shares") of LASIK AMERICA, INC., a Nevada corporation (the "Company"), at an initial exercise price, subject to adjustment in certain events (the "Exercise Price"), equal to $7.20 per Common Share, upon surrender of this Warrant Certificate and payment of the initial exercise price at an office or agency of the Company, but subject to the conditions set forth herein and in the Warrant Agreement dated as of the date hereof between the Company and Silverman (the "Warrant Agreement"). Payment of the Exercise Price shall be made by certified check or official bank check in New York Clearing House funds payable to the order of the Company, unless exercise is made pursuant to Section 4.2 of the Warrant Agreement. No Warrant may be exercised after 5:30 p.m., New York time, on the Expiration Date, at which time all Warrants evidenced hereby, unless exercised prior thereto, shall thereafter be void. The Warrants evidenced by this Warrant Certificate are part of a duly authorized issue of Warrants issued pursuant to a certain Warrant Agreement, which Warrant Agreement is hereby incorporated by reference in and made a part of this instrument and is hereby referred to for a description of the rights, limitation of rights, obligations, duties and immunities thereunder of the Company and the Holder (the word "Holder" meaning the registered Holder) of the Warrants. The Warrant Agreement provides that upon the occurrence of certain events, the Exercise Price and the type and/or number of the Company's securities issuable thereupon may, subject to certain conditions, be adjusted. In such event, the Company will, at the request of the Holder, issue a new Warrant Certificate evidencing the adjustment in the Exercise Price and the number and/or type of securities issuable upon the exercise of the Warrants; provided, however, that the failure of the Company to issue such new Warrant Certificate shall not in any way change, alter, or otherwise impair, the rights of the Holder as set forth in the Warrant Agreement. Upon due presentment for registration of transfer of this Warrant Certificate at an office or agency of the Company, a new Warrant Certificate or Warrant Certificates of like tenor and evidencing in the aggregate a like number of Warrants shall be issued to the transferee(s) in exchange for this Warrant Certificate, subject to the limitations provided herein and in the Warrant Agreement, without any charge except for any tax or other governmental charge imposed in connection with such transfer. Upon the exercise of less than all of the Warrants evidenced by this Certificate, the Company shall forthwith issue to the Holder hereof a new Warrant Certificate 9 representing such number of unexercised Warrants. The Company may deem and treat the registered Holder(s) hereof as the absolute owner(s) of this Warrant Certificate (notwithstanding any notation of ownership or other writing hereon made by anyone), for the purpose of any exercise hereof, and of any distribution to the Holder(s) hereof, and for all other purposes, and the Company shall not be affected by any notice to the contrary. All terms used in this Warrant Certificate which are defined in the Warrant Agreement shall have the meanings assigned to them in the Warrant Agreement. IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to be duly executed. Dated as of August 24, 2001. LASIK AMERICA, INC. - ---------------------------------- By: Robert S. Helmer Chief Operating Officer 10 [FORM OF ELECTION TO PURCHASE] The undersigned hereby irrevocably elects to exercise the right, represented by this Warrant Certificate, to purchase _______ Common Shares and herewith tenders in payment for such securities a certified check or official bank check payable in New York Clearing House Funds to the order of LASIK AMERICA, INC. in the amount of $_____, all in accordance with the terms of Section 4 of the Warrant Agreement dated as of ____________, 2001, between LASIK AMERICA, INC. and the undersigned (or its assignor). The undersigned requests that a certificate for such securities be registered in the name of __________ whose address is __________ and that such Certificate be delivered to whose address is _________. Dated: Signature _________________________________ (Signature must conform in all respects to name of Holder as specified on the face of the Warrant Certificate.) (Insert Social Security or Other Identifying Number of Holder) [FORM OF ASSIGNMENT] (To be executed by the registered Holder if such Holder desires to transfer the Warrant Certificate.) FOR VALUE RECEIVED ________________ hereby sells, assigns and transfers unto (Please print name and address of transferee) this Warrant Certificate, together with all right, title and interest therein, and does hereby irrevocably constitute and appoint Attorney, to transfer the within Warrant Certificate on the books of the within-named Company, with full power of substitution. Dated: ________________ Signature:________________________ SSN:__________________________ (Signature must conform in all respects to name of Holder as specified on the face of the Warrant Certificate.) (Insert Social Security or Other Identifying Number of Assignee) 11 EX-10.1 8 file007.txt EQUIPMENT PURCHASE AGREEMENT Exhibit 10.1 ------------ EQUIPMENT PURCHASE AGREEMENT This agreement is entered into this 3rd day of May, 2001 by and between --- ---- TrueVision Medical Associates, Inc., ("TVMA") Seller, and Dr. Howard Silverman ("Silverman") Purchaser. In consideration of the mutual covenants and promises contained herein the parties hereby agree as follows: 1. Sale of assets: - ------------------ Upon the terms and conditions hereinafter set forth, and in consideration of the payment of the purchase price, the Seller agrees to sell to Buyer all the assets described on the attached Exhibit A, herein referred to as the "Equipment". 2. The purchase price: - ---------------------- The purchase price shall be $64,000.00. The purchase price shall be paid in the following manner: A down payment of $7,000.00 in cash has been made [initialed and crossed out text: towards past due liabilities on the underlying obligation owed on the Equipment]. The balance of $57,000.00 will be payable in equal monthly installments over 18 months commencing June 1, 2001. The unpaid balance will accrue interest at the rate of 10%. A copy of the promissory note evidencing the indebtedness is attached hereto as Exhibit B. 3. Operational and maintenance expense: - --------------------------------------- Buyer agrees to assume all operational and maintenance expense involved with the equipment being purchased. 4. Seller's Indemnity: - ---------------------- Seller agrees to indemnify, and hold harmless Buyer in respect to any and all claims, losses, damages, liabilities, and expenses, (including without limitation, settlement costs, and any legal, accounting, and any other expenses for investigating or defending any actions or a threatened action) reasonably 1 incurred by Buyer in connection with any liabilities or claims made against Buyer because of any act or failure to act of Seller, rising prior to the purchase of the assets.(7) [circled] 5. Security documents: - ---------------------- The parties shall execute a security agreement, bill of sale, financing statement and any associated UCC documents, and other documents reasonably necessary to consummate the intention of this agreement and security of this agreement to insure prompt payment of the deferred portion of the purchase price. 6. Seller's Warranty: - --------------------- Seller represents and warrants that as of the date hereof: a. Seller has the authority to sell the assets described in Exhibit A. b. Those assets are free and clear of all security interests. 7. Buyer's Warranty: - -------------------- Buyer Expressly Warrants And Covenants That: a. Buyer will use the Collateral for business purposes and will keep the Collateral in Albuquerque, New Mexico, except as provided for in paragraphs C and D below. b. Buyer will not permit any of the Collateral to be removed from the above mentioned location outside the ordinary course of business without the prior written consent of Seller. c. Buyer will immediately advise Seller in writing of any change in any of Buyer's places of business, or the opening of any new place of business. d. Buyer will at Buyer's own expense forthwith insure the Collateral in a reliable insurance company against loss or damage by fire and extended coverage for an amount equal to its approximate value, and keep the same so insured 2 continuously until the full amount of said indebtedness is paid, with loss payable to Seller as Seller's interest may appear, and that Buyer will deliver said policies of insurance or copies of them or furnish proof of such insurance to Seller, and in case of loss, the Buyer shall have to right to apply the insurance proceeds to replace the Collateral which at all times will be large enough in value to fully and adequately secure the amount owed Seller. In the event the Buyer elects not to replace the Collateral, Seller shall retain from the insurance money an amount equal to the total balance of said indebtedness remaining unpaid, whether according to the tenor and effect of any promissory note or notes evidencing such indebtedness the same is due or not. Should the Buyer fail or refuse to forthwith effect such insurance and deliver the policies or furnish proof of such insurance as aforesaid, or fail to deep the Collateral so insured continuously until the full amount of said indebtedness is paid, Seller may at Seller's option effect such insurance and the amount so paid for such insurance with interest at the rate of ten percent (10%) per annum from the date of payment until repaid shall be added to said indebtedness, and the same shall be secured by the security agreement. e. Buyer will keep the Collateral in good condition and repair, reasonable wear and tear excepted, and will permit Seller and his/her agents to inspect the Collateral at any reasonable time. 8. Default: - ----------- Buyer shall be in default upon breaking of any covenant mentioned hereinabove, and further, upon the happening of any of the following events or conditions: 1. Default in thepayment or performance of any obligation, covenant or liability contained or referred to herein or in any note evidencing the same; 3 2. Any warranty, representation or statement made or furnished to Seller by or on behalf of Buyer proves to have been false in any material respect; 3. Loss, theft, damage, destruction, or sale of any of the Collateral without replacement, or the encumbering or making of any levy, seizure, or attachment thereon; 4. Dissolution, termination of existence, insolvency, business failure, appointment of a receive of any part of the property of, assignment for the benefit of creditors by, or the commencement of any proceeding, under any bankruptcy or insolvency lows by or against Buyer or any guarantor or surety for Buyer. Upon such default, or at any time thereafter, Seller shall give Buyer written notice setting forth the default and demanding a cure within ten (10) days after the notice is mailed. If the Buyer shall fail to cure the alleged default within the fifteen day period following notice, Seller may declare all obligations secured hereby immediately due and payable and shall have the remedies of a seller under the New Mexico Uniform Commercial Code. Buyer will upon demand make the Collateral available to Seller at the place and time designated by Seller which is reasonably convenient to both parties. Expenses of retaking, holding, preparing for sale, selling or the like shall include Seller's reasonable attorney's fees and legal expenses. Buyer waives the posting of bond in any replevin action against the equipment as a result of default. No waiver by Seller of any default shall operate as a waiver of any other default or of the same default on a future occasion. 9. Miscellaneous: - ----------------- a. The parties agree to execute any further documents and do all other acts necessary or appropriate to complete this transaction. b. All notices under this Agreement shall be in writing and shall be delivered by personal service, or by certified or registered mail, postage prepaid, return receipt requested as follows: SELLER TrueVision Medical Associates, Inc. P. O. Box 4834 San Diego, CA 92164 4 BUYER Mr. Howard Silverman 6646 Indian School Rd NE Albuquerque, NM 87110 All notices and other communications shall be deemed to be given at the expiration of three days after the date of mailing. The address of a party to which notices or other communications shall be mailed may be changed from time to time by giving written notice to the other parties. c. No amendment, supplement, modification or waiver of this agreement shall be binding unless executed in writing by the party to be bound thereby. d. This agreement shall be binding upon and inure to the benefit of the successors and assignees of the parties hereto. No other person shall have any right, benefit or obligation hereunder. e. This agreement shall be governed by and construed and enforced in accordance with the laws of New Mexico. f. In any court action involving this transaction, the losing party shall pay the prevailing party's reasonable attorney's fees and costs. IN WITNESS WHEREOF, each of the parties has executed this agreement as of the day and year first above written. "BUYER" /s/ Howard Silverman -------------------------- Howard Silverman "SELLER" TrueVision Medical Associates, Inc. /s/ John Homan -------------------------- By John Homan, President 5 |---------------------| |/seal/ OFFICIAL SEAL | | RACHEL FIERRO | | NOTARY PUBLIC | | STATE OF NEW MEXICO| |My Commission Expires| | 3-23-2003 | | --------- | |---------------------| STATE OF New Mexico ) -----------) SS. COUNTY OF Bernalillo ) ------------- 6 The foregoing instrument was acknowledged before me this ------- day of May, 2001, by Dr. Howard Silverman. ---------------------------- Notary Public My Commission Expires: - ---------------------- STATE OF NEW MEXICO ) ) SS. COUNTY OF Bernalillo ) ---------- The foregoing instrument was acknowledged before me this 3rd day --- of May, 2001, by John Homan, President of TrueVision Medical Associates, inc., a New Mexico corporation, on behalf of said corporation. /s/ -------------------- Notary Public |---------------------| |/seal/ OFFICIAL SEAL | | Thomas G. Rice | | NOTARY PUBLIC | | STATE OF NEW MEXICO| |My Commission Expires| | 10/26/02 | | --------- | |---------------------| My Commission Expires: 10/26/02 - ---------------------- 7 BILL OF SALE The undersigned, TrueVision Medical Associates, Inc., hereinafter designated as "Seller", for consideration received, does hereby grant, bargain and sell unto Dr. Howard Silverman, hereinafter designated as "Buyer", the following assets of Seller. The assets as set forth on the Assets List attached hereto And incorporated herein by reference as Exhibit 1. Buyer shall have all rights and title to the aforementioned personal property in Buyer and Buyer's executors, administrators, and assigns. Seller is the lawful owner of the aforementioned personal property and the personal property is free from all liens and encumbrances except as previously disclosed to Buyer in the Purchase Agreement. Seller has good title to sell the aforementioned personal property and will warrant and defend the title against the lawful claims and demands of all persons. Seller further warrants that all tangible personal property being transferred is in working order. SELLER GIVES NO WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. THERE ARE NO EXPRESS OR IMPLIED WARRANTIES WHICH EXTEND BEYOND THE DESCRIPTION ON THE FACE HEREOF. IN WITNESS WHEREOF, the seller has executed this Bill of Sale this 3rd --- Day of May 2001. SELLER: TVMA, INC. /s/ John Homan ------------------------- By John Homan, President 8 ACKNOWLEDGEMENT STATE OF NEW MEXICO ) ) SS. COUNTY OF Bernalillo ) The foregoing instrument was acknowledged before me this 3rd day --- of May, 2001, by John Homan, President of TrueVision Medical Associates, inc., a New Mexico corporation, on behalf of said corporation. -------------------- Notary Public |---------------------| |/seal/ OFFICIAL SEAL | | Thomas G. Rice | | NOTARY PUBLIC | | STATE OF NEW MEXICO| |My Commission Expires| | 10/26/02 | | --------- | |---------------------| My Commission Expires: 10/26/02 - ---------------------- 9 EX-10.3 9 file008.txt PROMISSORY NOTE Exhibit 10.3 ------------ PROMISSORY NOTE $57,000.00 Albuquerque, May 3 , 2001 New Mexico ----- For value received, the undersigned (hereafter Maker"), promises to pay to the order of TrueVision Medical Associates, Inc. (hereinafter "Holder"), at P. O. Box 4834, San Diego, CA 92164, (or to such other person, entity or address as Holder advises Maker in writing), the sum of Fifty-seven Thousand Dollars and no/100ths ($57,000.00), at ten percent (10%) interest per annum in the following manner until the entire balance hereof, with the interest thereon, has been fully paid: a. $3,423.26 on June 1, 2001; and b. $3,423.26 on the 1st day of each and every month thereafter until this Note is paid in full. The said monthly installments of $3,423.26 shall include interest on said principal amount and/or on the unpaid balance thereof at the rate of ten percent (10%) per annum, and when said installments are paid, they shall be apportioned between interest and principal, and applied first to the payment of all interest due at date of payment, and the balance applied on the principle amount. If any installment is not received within ten [initialed and crossed out text: (10)] (15) days of the due date, Maker agrees to pay as a late fee, an additional five percent(5%)of the monthly installment per month for each installment which is late, and Holder may mail to Maker at, 6646 Indian School Rd. NE, Albuquerque, NM 87110 (or such other address as Maker advises Holder in writing), certified mail, return receipt requested, written notice that the payment has not been received, and Maker will have ten (10) days from the 1 mailing of the notice to cure that default. If the default is not cured within a ten (10) day period, the whole of the principle sum then remaining unpaid, together with late fees and interest which shall continue to accrue at the same rate after default, shall forthwith become due and payable without further notice or demand, at the option of the Holder of this note. Maker further agrees after default of this obligation, the time of making the payment of the same may be extended without prejudice to the Holder and without releasing any maker hereof. Maker agrees to pay, in addition to all other sums due hereunder, all costs and expenses of collection of this note and/or enforcing same, including a reasonable attorney's fee, should this note be placed in the hands of an attorney for collection and/or enforcement, or is collected or enforced through bankruptcy, probate, or other judicial proceedings. Maker reserves the right without penalty to prepay all or a portion of the principal of this not at any time. MAKER: /s/ Dr. Howard Silverman - ------------------------ Dr. Howard Silverman 2 ASSIGNMENT OF PROMISSORY NOTE For and in consideration of the sum of $10.00 and other good and valuable consideration, TrueVision Medical Associates, Inc, (assignor) does hereby sell, assign, transfer and set over to the United States of America, Internal Revenue Service, (assignee) and unto its successors, all of its right, title, claim or interest of the assignor in and to that certain promissory note executed by Howard Silverman on May 3rd, 2001 for and in behalf of the assignor. The Promissory Note has a face amount of $57,000.00 and is due and payable in monthly installment over 18 months with monthly payments of $3,423.26. A copy of the note is attached hereto. The undersigned parties hereby agree that all future payments should be made by assignee to the Internal Revenue Service on behalf of any employee payroll trust fund liability owed by assignor to the Internal Revenue Service for the 2nd, 3rd, and 4th quarters of 2000. Assignor agrees that all payments made by Silverman may be made directly to the United States of America Internal Revenue Service. Assignor will advise Silverman of the address to which all payments are to be made to comply with this assignment. /s/ Howard Silverman -------------------------- Howard Silverman /s/ John Homan --------------------------- By John Homan, President TrueVision Medical Associates, Inc. 3 ACCEPTANCE OF ASSIGNMENT The United States of America, Internal Revenue Service, agrees to accept the payments under this assignment and to credit said payments to the employee payroll trust fund liability of TrueVision Medical Associates, Inc., FIN # 88-0434187 for the 2nd, 3rd, and 4th quarters of 2000. ------------------------- Internal Revenue Service 4 EX-10.4 10 file009.txt SECURITY AGREEMENT Exhibit 10.4 ------------ SECURITY AGREEMENT MAY 3, 2001 ----------- DATE Howard Silverman - ----------------------------------------------------------------------------- NAME A resident(s) of 6646 Indian School Rd. NE ------------------------------------------------------------- NO. AND STREET Albuquerque NM 87110 - ----------------------------------------------------------------------------- CITY COUNTY STATE (Hereinafter called "DEBTOR"), for consideration grants to TrueVision Medical Associates, Inc. - ------------------------------------------------------------------------------ NAME P.O. Box 4834 - ------------------------------------------------------------------------------ NO. AND STREET San Diego CA 92164 - ------------------------------------------------------------------------------ CITY COUNTY STATE (Hereinafter called "SECURED PARTY") a security interest in the following property and any and all additions, accessions and substitutions thereto or therefore (hereinafter called the "COLLATERAL"): See attached Exhibit A If marked here,[ ] Debtor grants a security interest in all similar property owned by Debtor during the time the Obligations are outstanding, although such property may be acquired after the date hereof; provided, however, that no security interest shall attach to consumer goods other than accessions unless the Debtor acquires rights in them within ten (10) days after the Secured Party gives value. To secure payment of the indebtedness evidenced by A Certain promissory note --- of even date herewith, payable to the Secured Party, or order, as follows: - ------ 1. $3,423.26 payable in June 1, 2001 2. 3,423.26 on 1st of each and every month unti8l Promissory Note of $57,000.00 is paid in full. 1 Together with such additional sums as may hereafter be advanced to the Debtor or expended by the Secured Party or its assigns on behalf of the Debtor or his assigns for any purpose whatsoever and evidenced by notes, drafts, open account, or otherwise, with interest thereon at rates to be fixed at the time of advancing or expending such additional sums; provided, however that the making of any such advances or expenditures shall be optional with Secured Party, or its assigns; and this security agreement shall secure the payment of any and all extensions or renewals and successive extensions or renewals of said note or notes, and of any indebtedness at any time owing to Secured Party, or its assigns, and shall further secure the payment of any and all indebtedness owing by Debtor to Secured Party, and for all of which this security agreement shall stand as continuing security until paid (all of such indebtedness being referred to as the "Obligations"); and the Debtor agrees that the Secured Party, its successors or assigns, may apply any payments made on the Obligations secured hereby, at its option, on any of the notes or other indebtedness secured hereby. DEBTOR EXPRESSLY WARRANTS AND COVENANTS: 1. That except for the security interest granted hereby Debtor is, or to the extent that this agreement states that the Collateral is to be acquired after the date hereof, will be, the owner of the Collateral free from any adverse lien, security interest or encumbrance; and that Debtor will defend the Collateral against all claims and demands of all persons at any time claiming the same or any interest therein. 2. That is marked here , the Collateral is used or bought primarily for personal, family or household purposes; that if marked here , the Collateral is used or bought primarily for use in farming operations; that if marked here the Collateralis being acquired with the proceeds of the note or notes, which Secured Party may disburse direct to the Seller of the collateral. 3. That Debtor's count of residence is as stated above, and the Collateral will be kept at 1700 Louisiane Blve. NE Albuquerque Bernalillo New Mexico - ------------------------------------------------------------------------------ NO. STREET CITY COUNTY STATE 4. That if any of the Collateral is crops growing or to be grown, goods which are or are to become fixtures, timber to be cut or minerals or the like (including oil and gas) or accounts financed at the wellhead or minehead of the well or mine, a description of the real estate is as follows: And the name of the record owner of the real estate is ------------------------- - ------------------------------------------------------------------------------- And that if the Collateral is attached to real estate or if the Collateral includes crops growing or to be grown, goods which are or are to become 2 fixtures, timber to be cut or minerals or the like (including oil and gas) or accounts financed at the wellhead or minehead or the well or mine, Debtor will, on demand or Secured Party, furnish Secured Party with a disclaimer or disclaimers or a subordination agreement signed by all persons having an interest in the real estate, disclaiming or subordinating any interest in the Collateral which is prior to Secured Party's interest. 5. That no financing statement covering the Collateral or any proceeds thereof is on file in any public office and that at the request of Secured Party, Debtor will join with Secured Party in executing one or more financing statements pursuant to the New Mexico Uniform Commercial Code in form satisfactory to Secured Party and will pay the cost of filing such financing statement, this security agreement and any continuation or termination statement, in all public offices wherever filing is deemed by Secured Party to be necessary or desirable. A carbon, photographic or other reproduction of a Security Agreement or a Financing Statement is sufficient as a Financing Statement. 6. Not to sell, transfer or dispose of the Collateral, nor take the same or attempt to take the same from the county where dept as above stated, without prior consent of the Secured Party. 7. To pay all taxes and assessments of every nature which may be levied or assessed against the Collateral. 8. Not to permit or allow any adverse lien, security interest or encumbrance whatsoever upon the Collateral, and not to permit the same to be attached or replevined. 9. That the Collateral is in good condition, and that he will. At his own expense, keep the same in good condityion and from time to time, forthwith, replace and repair all such parts of the collateral as may be broken, worn out, or damaged without allowing any lien to be created upon the Collateral on account of such replacement or repairs, and that the Secured Party may examine and inspect the Collateral at any time, wherever located. 10.At its option, Secured Party may discharge taxes, liens or security interests or other encumbrances at any time levied or placed on the collateral and may pay for the repair of any damage or injury and may pay for the maintenance and preservation of the Collateral. Debtor agrees to reimburse Secured Party on demand for any payment made or expense incurred by Secured Party pursuant to the foregoing authorization. Until such reimbursement, the amount of any such payment, with interest at the rate of 10% annum from date of payment until reimbursement, shall be added to the indebtedness owed by Debtor and shall be secured by this security agreement. 11.That he will at his own expense forthwith insure the Collateral in a reliable insurance company against loss or damage by fire and Extended coverage For an amount equal to the aggregate sum of said indebtedness, and keep the same so insured continuously until the full amount of said indebtedness is paid, with loss payable to Secured Party as its interest may appear, and that he will on demand deliver said policies of insurance or furnish proof of such insurance to 3 the Secured Party, and in case of loss, the Secured Party shall retain from the insurance money an amount equal to the total balance of said indebtedness the same is due or not. Should the Debtor fail or forthwith effect such insurance and deliver the policies or furnish proof of such insurance as aforesaid, or fail to keep the Collateral so insured continuously until the full amount to said indebtedness is paid, the Secured Party may at its option effect such insurance and the amount so paid for such insurance with interest at the rate of 10% per annum form date of payment until repaid shall be added to said indebtedness, and the same shall be secured by this security agreement. 12. That in the event this security agreement is placed in the hands of any attorney for enforcement, said Debtor will pay the reasonable attorney's fees of Secured Party, but in no event less than then per cent (10%) of the total amount due or unpaid and said Debtor will pay said Secured Party any and all costs and expenses incurred in recovering possession of the Collateral and incurred in enforcing this security agreement, and the same shall be secured by this security agreement. 13. That he will not use the Collateral in violation of any applicable statuses, regulations or ordinances, and that if the Collateral includes one or more motor vehicles he will not rent the Collateral nor allow the Collateral to be used in rental service, or in any speed or endurance contest. 14. That if the Collateral includes one or more motor vehicles he will not use or cause or permit the Collateral to be used for the transportation of liquor, wines or any other beverage for personal or commercial use, prohibited by any Federal or State statute to be transported. UNTIL DEFAULT debtor may have possession of the Collateral and use it in any lawful manner not inconsistent with this agreement and not inconsistent with this agreement and not inconsistent with any policy of insurance thereon, and upon default Secured Party shall have the immediate right to the possession of the Collateral. DEBTOR SHALL BE IN DEFAULT under this agreement upon the happening of any of the following events or conditions: (a) default in the payment or performance of any obligation, covenant or liability contained or referred to herein or in any note evidencing the same; (b) any warranty, representation or statement made or furnished to Secured Party or on behalf of Debtor proves to be false in any material respect when made or furnished; (c) any event which results in the acceleration of the maturity of the indebtedness of Debtor to others under any indenture, agreement or undertaking; (d) loss, theft, damage, destruction, sale or encumbrance to or of any of the Collateral, or the making of any levy, seizure or attachment thereof or thereon; 4 (e) death, dissolution, termination of existence, insolvency, business failure, appointment of a receiver of any part of the property of, assignment for the benefit of creditors by, or the commencement of nay proceeding under any bankruptcy or insolvency laws by or against Debtor or any guarantor or surety for Debtor. UPON SUCH DEFAULT and at any time thereafter, or if it deems itself insecure, Secured Party may declare all Obligations secured hereby immediately due and payable and shall have the remedies of a secured party under the New Mexico Uniform Commercial Code. Secured Party may require Debtor to assemble the Collateral and deliver or make it available to Secured Party at a place to be designated by Secured Party which is reasonably convenient to both parties. Unless the Collateral is perishable or threatens to decline speedily in value or is of a type customarily sold on a recognized market, Secured Party will give Debtor reasonable notice of the time and place of any public sale thereof or of the time after which any private sale or any other intended disposition thereof is to be made. The requirements of reasonable notice shall be met if such notice is mailed, posage prepaid, to the address of Debtor shown at the beginning of this agreement at least five days before the time of the sale or disposition. Expenses of retaking, holding, preparing for sale, selling or the like shall include Second Party's reasonable attorney's fees and legal expenses. No waiver by Secured Party of any default shall operate as a waiver of any other default or of the same default on a future occasion. The taking of this security agreement shall not waive or impair any other security said Secured Party may have or hereafter acquire for the payment of the above indebtedness, nor shall the taking of any such additional security waive or impair this security agreement; but said Secured Party may resort to any security it may have in the order it may deem proper, and notwithstanding any collateral security, Secured Party shall retain its rights of setoff against the Debtor. All rights of Secured Party hereunder shall inure to the benefit of its successors and assigns; and all promises and duties of Debtor shall bind his heirs, executors or administrators or his or its successors or assigns. If there be more than one Debtor, their liabilities hereunder shall be joint and several. This agreement shall become effective when it is signed by Debtor. Secured Party: Debtor: /s/ /s/ Howard Silverman - ------------------------------------ -------------------------------- True Vision Medical Associates, Inc. Howard Silverman - ------------------------------------ -------------------------------- - ------------------------------------ -------------------------------- Note: Notarized acknowledgments are not required by New Mexico Statutes for UCC financing statements and security agreements (New Mexico Statutes Annotated, w/1985 Cumulative Supplements, Sec. 14-8-4). 5 Item Qty Manufacturer Model Number Serial Lot Number Name Number Pachymeter 1 Sonomed Micropach 200p P2-0699-0449 Topographer 1 Zeis-Humphreys Ae992 992-2332 Autoclave 1 SCICAN Statum 2000 2109I6730 Autoclave 1 SCICAN Statum 2000 208887A Autoclave 1 Ritter Speedclave 678L Autoclave 1 Fisher 750 D59983577 Plum Sled-base chairs 4 Hayworth C500-1213 MKB122018 Plum Sled-base chairs 2 Hayworth C500-1213 MKB122292 Plum Sled-base chairs 3 Hayworth Chair 1 Marco 1280 99H0101 Stand 1 Marco 1290 99G0207 Phoropter 1 Marco Reichert 11635 17255-4 Slit Lamp 1 Marco Ultra Slitlamp 99HJ0123 G2 Projector 1 Marco 25839 Chair 1 Marco 1280 99H0102 Stand 1 Marco 1290 999G0208 Phoropter 1 Reichert 11635 17255-4 Slit Lamp 1 Marco 25836 Projector 1 Marco 25836 Side Chair 1 Reliance 4246 43109902110 Side Chair 1 Reliance 4246 43109902121 Side Chair 1 Reliance 4246 4310990216 Assorted Refractive Surgical Instruments 2 Black Leather/Wood Recliner Chairs 2 Black Leather/Wood Ottomans 3 Wood Office Desks 1 Wood Credenza 1 Toshiba Phone Systems & 9 Handsets Computer Network: 1 Server & 3 Complete Work Stations ACT Database CompuLink Software ALL PATIENT FILES
EXHIBIT A To Security agreement dated May 3, 2001 By and between Howard Silverman, Debtor and TrueVision Medical Associates, Inc., Secured Party /s/ Howard Silverman - ------------------------- Howard Silverman /s/ John C. Homan - ------------------------- John C. Homan, President TrueVision Medical Associates, Inc., 6 EX-10.5 11 file010.txt VISX SALES AGREEMENT Exhibit 10.5 ------------ V I S X 3400 Central Expressway WE MAKE THINGS CLEAR Santa Clara, CA 95051-0703 sales agreement Tel: (408) 733-2020 FAX: (408) 773-7055 BILL TO: Lasik America, Inc. SHIP TO: Lasik America, Inc. "Buyer" 6644 Indian School Rd. NE 6644 Indian School Rd. NE Albuquerque, NM 87110 Albuquerque, NM 87110 Telephone No. 505-837-2020 Telephone No. 505-837-2020 Contact: Robert Helmer Contact: Robert Helmer - ---------|--------|----------------------|--------------|----------------------- DATE |SHIP VIA| F.O.B. | PAYMENT TERMS|ESTIMATED DELIVERY DATE - ---------|--------|----------------------|--|-----------|----------------------- | |Destination - Charge Back| Net 30 | - ---------|--------|-------------------------|----|------|------|---------------- QUANTITY |ITEM NO.| PRODUCT DESCRIPTION "PRODUCT"| UNIT COST | EXTENDED COST - ---------|--------|------------------------------|-------------|---------------- | | VISX VisionKey(R)Cards | $10.00 | All taxes| | S/N 3095 |(plus | Shipping,| | | applicable | and | | | licensefee) | Insurance| | | Subtotal:| are the | | |Less Deposit:| Buyer's | | | Tax:| respons- | | |Shipping/Ins:| ibility | | | TOTAL:| | | | | - ---------|--------|------------------------------|-------------|---------------- SALES TAX STATUS: Goods are being purchased for resale: Yes X No (check one). ---- --- If yes, resale certificate # Applied for 5/10/01 (please attach copy as required). ------------------------- Purchaser of goods being purchased is exempt from sales tax: Yes No (check one). --- --- If yes, please state basis and provide exemption certificate as appropriate. - -------------------------------------------------------------------------------- CAUTION: THE VISX STAR EXCIMER LASER SYSTEM (T M) (THE "SYSTEM) MAY ONLY BE USED IN THE UNITED STATES BY EYE CARE PRACTIONERS WHO HAVE BEEN TRAINED IN THE SYSTEM'S CALIBRATION AND OPERATION AND WHO HAVE EXPERIENCE IN THE SURGICAL MANAGEMENT AND TREATMENT OF THE CORNEA. THE SYSTEM MAY ONLY BE USED IN THE UNITED STATES FOR PERFORMING INDICATIONS APPROVED BY THE UNITED STATES FOOD AND DRUG ADMINISTRATON, AS DESCRIBED IN THE VISX OPERATOR'S MANUALS. USE OF THE SYSTEM FOR ANY OTHER PROCEDURE IS INVESTIGATIONAL. USE OF THE SYSTEM IS PROHIBITED IN THE ABSENCE OF A VALID VISX PATENT LICENSE. 1 VISX RESERVES THE RIGHT TO REJECT ALL ORDERS PRIOR TO SHIPMENT IN ITS SOLE DEISCRETION. THE SALE OF THE PRODUCTS IS GOVERNED BY THIS SALES AGREEMENT WITH THE ATTACHED TERMS AND CONDITIONS. NO TERM OR CONDITION CONTAINED IN THE BUYER'S PURCHASE ORDER (OTHER THAN SHIPPING DESTINATION) SHALL APPLY AND VISX HEREBY OBJECTS TO ANY SUCH TERM OR CONDITION. ACCEPTED: AGREED: VISX, INCORPORATED BUYER I am authorized to sign this Sales Agreement on Buyer's behalf. /s/ Robert S. Helmer - -------------------------------- ------------------------------------ By: Print Name: Robert S. Helmer Title: Print Title: Chief Operating Officer Date: Print Date: 5/10/01 Terms and Conditions attached TERMS AND CONDITIONS OF SALE FOR VISX PRODUCTS Purchase. Subject to these Terms and conditions. Buyer agrees to purchase and - -------- VISX agrees to sell the Products described on the front page of these Terms and Conditions, provided that VISX retains title to the VisionKey card data and all copyrights, trade secret rights and other intellectual property rights. All sales, use, and other taxes and charges that VISX may be required to pay or collect with respect to the Products covered by this Agreement shall be charged to the Buyer. Restrictions. Use of the VISX Excimer Laser System (T M) (the "System) and the - ------------ Vision Key cards is subject to Buyer's agreement to the terms of the separate VISX Patent License (the "License Agreement"). The License Agreement must be executed by Buyer prior to installation of the System. Sale of the Products alone shall in no way be construed as an implied license to perform procedures using the System, nor does sale of Products convey any license, expressly or by implication, to manufacture, duplicate or otherwise copy or reproduce any of the Products. Buyer man not assign or otherwise transfer this Agreement or any of its rights or obligations hereunder. Buyer is prohibited from tampering with or attempting to reverse engineer the VisionKey card or any device or software installed on the System for the purpose of monitoring the number of Licensed Procedures performed. MODIFYING OR ALTERING THE SYSTEM, THE SOFTWARE IN THE SYSTEM, THE VISIONKEY CARD OR THE CARD READING MECHANISM IN ANY WAY CONSTITUTES WILLFUL INFRINGEMENT OF VISX'S INTELLECTUALPROPERTY AND MAY ENDANGER PATIENT SAFETY AND COSMETIC ACT AND COULD SUBJECT THE BUYER AND/OR THE AUTHORIZED USERS TO ACTION BY THE FDA RESUTING IN SEIZURE, INJUNCTION, CIVIL PENALTIES, AND/OR CRIMINAL PROSECUTION. Security Interest. Buyer hereby grants to VISX a security interest in all of its - ----------------- right and interest, now or in the future,in and to the System and all additions, accessions, and upgrades to the System to secure performance of the Buyer's obligations under the License Agreement, including the obligation to pay the fees associated with performance of Licensed Procedures. Buyer agrees to execute 2 any documents as reasonably requested by VISX to perfect and enforce its rights. Buyer understands that if it breaches any obligation in the License Agreement, VISX will be entitled to disable or take possession of the System without notice. Downpayment and Cancellation. If Buyer cancels delivery prior to shipment of the - ---------------------------- Products, any downpayment paid by Buyer shall be non-refundable. Delivery. VISX shall use reasonable efforts to deliver the Products on the date - -------- specified on the front of these Terms and Conditions. Risk of loss of or damage to the Products shall pass to Buyer upon delivery to the Buyer's location set forth under "Ship To" on the front page of these Terms and Conditions. Buyer shall obtain and maintain at its own expense insurance against loss of or damage to the System, and public liability and property damage insurance, for the period beginning on the date of delivery to Buyer's location and ending on the date full payment for the System is made. VISX reserves title to all Products until full payment has been received, except that title to VisionKey card data remains in VISX. Shipping, delivery and installation dates are approximate and are based upon prompt receipt of all necessary information. VISX will not be liable for failure to ship products in connection with governmental order, strikes, floods, fires, earthquakes, and other causes reasonably beyond VISX's control, including inability to obtain labor or materials or other production delays, in which case VISX may postpone delivery, shipment, or installation at its option without liability. Installation and Acceptance. VISX will install the System at Buyer's facility - --------------------------- and shall complete the items required by VISX's standard installation checklist. Upon successful completion of the items on the installation checklist. Buyer will sign the delivery and acceptance form acknowledging acceptance of the System. Buyer's Remedies. In the event of a breach by VISX of any of the terms, - ---------------- provisions, or warranties under this contract, or a violation of any representation made in this Agreement. VISX's sole and exclusive liability and Buyer's sole and exclusive remedy shall be limited at VISX's option to either (a) repair or replacement of any goods which are the subject of any such breach, default or violation, or (b) refund of the purchase price of such goods. EXCEPT AS SET FORTH IN THE ATTACHED "TERMS OF WARRANTY OF VISX EXCIMER LASER SYSTEM," ALL WARRANTIES OF ANY NATURE, EXPRESS OR IMPLIED, INCLUDING ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, ARE EXCLUDED AND DISCLAIMED. Training. VISX will provide Buyer with initial system operator and physician - -------- training as specified by the Food and Drug Administration, not to exceed five (5) physicians per System; training for additional system operators and physicians will be provided at VISX's standard charges. VISX will notify Buyer of any further training that may be required in the future to comply with FDA requirements of VISX licensing policies. 3 Governing Law. This Agreement shall be governed by and construed under the laws - ------------- of the State of California without regard to conflict of law principles. Buyer consents to the jurisdiction of the federal and state courts in California and agrees that venue shall lie exclusively in Santa Clara County, California. Arbitration. Any controversy or claim arising out of or relating to this Sales - ----------- Agreement, or the beach thereof, shall be finally settled by binding arbitration in Santa Clara County, California under the Commercial Arbitration Rules of the American Arbitration Association by one arbitrator appointed in accordance with such Rules; provided, however, that neither party shall be precluded from seeking injunctive relief in a court of law. Judgment on the award rendered by the arbitrator may be entered in any court having jurisdiction thereof. Entire Agreement; No Modification. This writing together with the License - --------------------------------- Agreement is intended by VISX and Buyer as a final expression of their agreement and as a complete and exclusive statement of the terms of their agreement. No course of Prior dealings between the parties and no usage of the trade shall be relevant to supplement or explain any term used in this Agreement. No modification of or amendment to this Agreement, nor any waiver of any rights under this Agreement, shall be effective unless in writing signed by the party to be charged. Limitation Period. No suit or legal proceeding arising under the terms, - ------------------ conditions, and warranty provisions of this Sales Agreement shall in any case be maintainable against VISX unless commenced or made against VISX within one year after the expiration of the applicable warranty period, and the lapse of such period shall be a complete bar to any recovery in any such suit or proceeding. Severability of Terms. If any term or condition (or part thereof) contained - --------------------- herein is held to be invalid, the remaining terms and conditions of this Sales Agreement shall not be affected thereby. TERMS OF WARRANTY OF VISX EXCIMER LASER SYSTEM Product Warranty. VISX warrants that, subject to the limitation and disclaimer - ---------------- below, the System and VisionKey cards will be free from defects in materials and workmanship for a period of one year from the date of initial installation of the System when properly installed, maintained, and used for its intended purpose. During the warranty period VISX will, at its option, either repair or replace any equipment that does not conform with the foregoing warranty or refund the purchase price. Warranty Repair. Before returning any Product to VISX Buyer shall first obtain - --------------- return material authorization from the VISX Service Department. The Returned Material Authorization Number issued by VISX must be noted on the outside of the shipping container. VISX DISCLAIMS ALL LIABILITY WITH RESPECT TO DATA CONTAINED IN ANY PRODUCT RETURNED FOR REPAIR. 4 Limitations. This warranty applies only to the end user who is the original - ----------- purchaser of the Product, and only so long as the Product is used in the country to which it was originally shipped by VISX. This warranty will not apply to any Product that has been subjected to improper operation, unauthorized repair or modification of hardware or software, or operation outside of the environmental specifications of the Product. This warranty is null and void if the user attempts to service or repair the Products (other than performing the maintenance described in the operator and technical manuals), or if service is performed by persons who are neither trained nor certified by VISX. TAMPERING WITH THE VISIONKEY CARD OR THE SYSTEM'S CARD READER INSTALLED IN THE SYSTEM WILL AUTOMATICALLY VOID THIS WARRANTY. Disclaimer. EXCEPT AS SET FORTH HEREIN, ALL WARRANTIES OF ANY NATURE, EXPRESSOR - ---------- IMPLIED, INCLUDING ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, ARE EXPRESSLY EXCLUDED AND DISCLAIMED. THE FOREGOING WARRANTIES ARE EXCLUSIVE AND IN LIEU OF ALL OTHER WARRANTIES, EXPRESS, IMPLIED, STATUTORY OR OTHERWISE. VISX DOES NOT WARRANT THAT THE OPERATION OF THE PRODUCTS WILL BE UNINTERRUPTED OR ERROR FREE. Service Contract. VISX offers repair and maintenance services beyond the - ----------------- warranty period under a separate service contract. Any out-of-warranty repair services provided to Buyer without a service contract shall be paid for by Buyer at VISX's standard charges. Limitation of Liability. VISX WILL NOT BE LIABLE FOR INCIDENTAL, CONSEQUENTIAL, - ----------------------- INDIRECT OR SPECIAL DAMAGES OF ANY KIND, INCLUDING BUT NOT LIMITED TO DAMAGES FOR LOSS OF REVENUE, LOSS OF DATA, LOSS OF BUSINESS OR BUSINESS OPPORTUNITY OR OTHER FINANCIAL LOSS ARISING OUT OF OR IN CONNECITON WITH THE SALE, INSTALLATION, PERFORMANCE, FAILURE, USE OR INTERRUPTED USE OF ITS PORDUCTS, OR THE UNAUTHORIZED USE OF THE PRODUCTS. VISX'S LIABILITY FOR ANY LOSS OR DAMAGE ARISING OUT OF OR RESULTING FROM THIS AGREEMENT OR ITS PERFORMANCE OR BREACH, OR IN CONNECTION WITH THE PRODUCTS FURNISHED HEREUNDER, WILL IN NO CASE EXCEED THE PRICE OF THE SPECIFIC PRODUCT WHICH GIVES RISE TO THE CLAIM. 5 EX-10.6 12 file011.txt PATENT LICENSE Exhibit 10.6 ------------ Visx (logo) PATENT LICENSE -------------- This Patent License (this "License") is entered into by and between VISX, Incorporated ("VISX") and the Licensee listed below in connection with the use of the VISX STAR S2(TM) Excimer Laser System Serial Number C3095 _ (the "System") and is effective as of the date of the later of the parties signatures set out below. - ------------------------------------------------|------------------------------- The Licensee is: | The Authorized Users are: Lasik America, Inc. | Stuart Cooper, M.D. 6644 Indian School Rd. NE | Alfred Lovato Jr., M.D. Albuquerque, NM 87110 | Donald E. Rodgers, M.D. | Stephen Graham, M.D. System shall initially be installed at ("Site") | The License Fee is $100.00 per | Licensed Procedure - ------------------------------------------------|------------------------------- A. WHO MAY USE THE SYSTEM? ----------------------- Authorized Users. Licensee and the individuals designated above (the "Authorized - ---------------- Users") are the only persons permitted to use the System. Licensee shall permit only eye care practitioners who have experience in the surgical management and treatment of the cornea and who are legally qualified, properly licensed and fully trained and certified by VISX (or its designees) to perform Licensed Procedures (as defined below) on the System. Licensee will provide VISX at least 10 days prior written notice of any change in the designated Authorized Users. Licensee represents, warrants and covenants that it is and its Authorized Users are, and will remain for so long as Licensee is using the System, fully licensed and legally qualified and certified by VISX to perform the specific Licensed Procedure to be performed, and that Licensee and its Authorized Users shall remain trained in the proper techniques for performing that Licensed Procedure in the most effective and safe manner. Licensee shall notify VISX promptly of any exception to the foregoing representation, warranty and covenant. B. INTELLECTUAL PROPERTY RIGHTS ---------------------------- 1. Patents. The System, the VisionKey (R) card, and certain related ------- disposables, and their use, are covered by several United States patents for which VISX has the authority to provide this License. A list of these patents is set forth in Schedule A (the "Patents"). The Patents cover apparatus and methods for performing ophthalmic laser surgery. Use of the System to perform any procedure covered by the Patents is prohibited unless 1 such use is authorized by a valid VISX Patent License. The sale, lease or other transfer of the System by VISX or any other person or entity does not in any way grant a license under any Patent to use the System to perform any procedures. Such license may only be granted by the delivery to VISX of a fully-executed VISX Patent License. 2. Ownership of Intellectual Property Rights. VISX owns all right, title, and ------------------------------------------ interest in the VisionKey cards, and in all of VISX's patents, trademarks, trade names, inventions, copyrights, know-how, and trade secrets relating to the design, use, manufacture, operation or service of the System and relating to performance of Licensed Procedures. The use by Licensee of any of these intellectual property rights is permitted only for the purposes authorized in this License and only in connection with use of the System, and upon termination of this License for any reason such authorization shall cease. Licensee recognizes that performance of the Licensed Procedures without payment of the License Fee constitutes infringement of VISX's intellectual property rights. C. GRANT ----- 1. License Grant. Subject to Licensee's compliance with the terms of this -------------- License. VISX continuations, continuations-in-part, divisional patents, reexaminations, renewals, hereby grants to Licensee the right and license under the Patents (including any extensions and reissues of such Patents) to perform, and permit Authorized Users to perform, any ultraviolet laser corneal surgery procedure using the System and related disposables, which performance or use is covered by at least one claim of a Patent (a "Licensed Procedure") at the Site. Upon breach by Licensee of any of its obligations contained in this License, the license granted hereby shall be revoked and VISX shall have the right, without notice or demand, to disable or take possession of the System. This License is limited to the performance of Licensed Procedures using the System. 2. Consideration. In consideration for the license granted under the Patents ------------- pursuant to Section C.1, Licensee shall pay the License Fee listed on the front page of this License each time the System is used to perform a Licensed Procedure, except that the License Fee shall be $-0- each time the System is used to perform a phototherapeutic keratectomy (PTK). For convenience of the parties, payment of the License Fee is due upon shipment of each VisionKey card and payable on the terms set forth in the Sales or Lease Agreement. The License Fee does not include the cost of the card. 3. Tampering. Licensee is prohibited from tampering with or attempting to --------- reverse engineer the VisionKey card or any device or software installed on the System for the purpose of monitoring the number of Licensed Procedures performed. MODIFYING OR ALTERING THE SYSTEM, THE VISIONKEY CARD OR THE CARD READING MECHANISM IN ANY WAY CONSTITUTES WILLFUL INFRINGEMENT OF THE INTELLECTUAL PROPERTY LICENSED UNDER THIS LICENSE AND MAY ENDANGER PATIENT 2 SAFETY. ANY SUCH MIDIFICATIONOR ALTERATION WILL RENDER THE SYSTEM ADULTERATED UNDER THE FEDERAL FOOD, DRUG AND COSMETIC ACT AND COULD SUBJECT THE LICENSEE AND/OR THE AUTHORIZED USERS TO ACTION BY THE FDA RESULTING IN SEIZURE, INJUNCTION, CIVIL PENALTIES, AND/OR CRIMINAL PROSECUTION. 4. Term and Termination. This License will continue until the expiration of --------------------- the last of the Patents to expire and Licensee's obligation to pay the License Fee shall terminate for a given procedure on the expiration of the last of the Patents containing one or more claims which cover use of the System or performance of such procedure. This License may be terminated at any time by VISX if (a) Licensee fails to make any payment due under this License within 30 days of the due date, (b) Licensee has tampered in any way with the VisionKey card or the card reading mechanism, the software installed in the System, or any other part of the System, or (c) Licensee fails to cure any other breach of this License within 30 days after VISX provides written notice of such breach to Licensee. Upon any early termination, Licensee and all Authorized Users shall cease all use of the System. Licensee understands that the security interest in the system granted to VISX in the Sales or Lease secures performance of Licensee's obligations under this License. The respective rights and obligations of VISX and Licensee under the provisions of Sections C.3, C.4, D.2, E.1, E.2, and E.4 shall survive any termination of this License. D. LOCATION AND CONDITION OF THE SYSTEM ------------------------------------ 1. Initial Installation Site. The System shall initially be installed at the ------------------------- Site designated on the first page of this License. 2. Relocation and Transfer. Licensee shall not move the System from the Site ------------------------ unless it provides at least 30 days prior written notice of the new site to VISX. Licensee man not sell or otherwise transfer the System unless the proposed transferee has entered into the then current form of VISX Patent License for the System, at which time this License shall terminate and Licensee's rights under this License shall expire. Licensee may not transfer or sublicense any of its rights or obligations under this License without VISX's prior written consent, except as may be implicit in its granting the Authorized Users the privilege to use the System pursuant to this License. 3. Use and Maintenance. Licensee and the Authorized Users shall use the System ------------------- only in accordance with the procedures and other requirements set forth in the user's manuals or other documentation accompanying the System or otherwise provided to Licensee by VISX. Licensee shall cause the System to be properly maintained in accordance with VISX's service recommendations and shall ensure that all Licensed Procedures performed using the System are performed in a safe and effective manner. Licensee shall not be obligated by this License to retain VISX or any of its affiliates to perform maintenance on the System. 3 4. Access to System. Licensee shall allow VISX, at VISX's sole expense, from ---------------- time to time to install or to attach to the System, and to modify, adjust and read, a memory, recording or other device and/or software (including telephone connections of the devices with VISX) which measures the number and types of Licensed Procedures performed with the System. Licensee shall not permit anyone other than an authorized VISX representative to alter or remove any such devices or software. In addition, Licensee shall permit VISX, its affiliates and authorized representatives to inspect the System and/or Licensee's records at least once per month during reasonable business hours and upon at least 48 hours prior notice for the purpose of obtaining the information measured by any device or software installed on the System and to monitor Licensee's compliance with the terms of this License. E. LIABILITY, IMMUNITY, AND COMPLIANCE WITH LAWS --------------------------------------------- 1. Disclaimer of Liability. VISX SHALL NOT BE LIABLE FOR INCIDENTAL, ------------------------- CONSEQUENTIAL, INDIRECT OR SPEICAL DAMAGES OF ANY KIND, INCLUDING BUT NOT LIMITED TO DAMAGTES FOR LOSS OF REVENUE, LOSS OF DATA, LOSS OF BUSINESS OR BUSINESS OPPORTUNITY OR OTHER FINANCIAL LOSS ARISING OUT OF OR IN CONNECITON WITH THE SALE, INSTALLATION, PERFOMANCE, FAILURE, USE OR INTERRUPTED USE OF ITS PRODUCTS, OR THE UNAUTHORIZED USE OF THE PRODUCTS. VISX'S LIABILITY FOR ANY LOSS OR DAMAGE ARISING OUT OF OR RESULTING FROM THIS LICENSE OR ITS PERFORMANCE OR BREACH, OR IN CONNECTION WITH THE PRODUCTS FURNISHED PURSUANT TO THIS LICENSE, WILL IN NO CASE EXCEED THE PRICE OF THE SPECIFIC PRODUCT WHICH GIVES RISE TO THE CLAIM. 2. Required Insurance. Licensee shall maintain general liability insurance ------------------- covering use of the System. Such insurance shall name VISX as an additional insured and shall be in minimum amounts of $1,000,000 per occurrence, $5,000,000 annual aggregate. Licensee shall obtain from each Authorized User proof of professional liability insurance in minimum amounts of $1,000,000 per occurrence, $3,000,000 annual aggregate. 3. Immunity and Indemnification. So long as the Licensee and its Authorized ----------------------------- Users comply in full with this License Agreement. VISX hereby grants immunity to the Licensee and the Authorized Users from any infringement or other legal action under the Patents arising from Licensee's use of the System to perform Licensed Procedures. VISX makes no representation or warranty regarding the scope or validity of any of the Patents. VISX agrees to indemnify Licensee and its Authorized Users against liability actually and reasonably incurred arising from a third party claim that the possession or use of the System in accordance with VISX's instructions for us constitutes an infringement of any United States patent or other intellectual property right of such third party. This indemnification is subject to the following conditions: (a) Licensee must notify VISX immediately upon receipt of notice of any such claim, (b) Licensee must 4 keep VISX fully informed of any developments in connection with any such claim, (c) Licensee shall cooperate fully with VISX in the defense of any such claim, and (d) VISX shall have the right to undertake the defense, compromise or settlement of any such claim on Licensee's behalf, subject to Licensee's approval which approval shall not unreasonably be withheld. No implied licenses are created by this provision. 4. Compliance with Laws. Licensee shall comply with, and shall cause each --------------------- Authorized User to comply with, all laws, rules and regulations of any governmental authority applicable to use of the System, including without limitation the federal Food, Drug and Cosmetic Act and any labeling requirements of the United States Food and Drug Administration. Licensee shall permit VISX to affix to the System additional notices that VISX reasonably deems necessary. Licensee shall not remove or tamper with any notices or labels affixed to the System. F. GENERAL PROVISIONS ------------------ This License between VISX And Licensee is binding on their respective successors and permitted assigns and legal representatives. This License is subject to and interpreted under the laws of the State of California (without regard to principle of conflict of laws) and cannot be amended, nor can any term be waived, except in a writing signed by both parties. Any controversy or claim arising out of or relating to this License, or the breach thereof, shall be settle by arbitration administered by the American Arbitration Association under its Commercial Arbitration Rules, and judgment on the award rendered by the arbitrator(s) may be entered in any court having jurisdiction thereof, provided however, that neither party shall be precluded from seeking injunctive relief in a court of law. No waiver or modification in any one instance shall be a waiver or modification in any other. No third party rights will be created by the execution or performance of this License. This License together with the Sales or Lease Agreement, as applicable, contains the entire understanding between VISX and Licensee with respect to its subject matter and supersedes all other agreements, discussions, and understandings with respect to the subject matter. Notices under this License shall be sent by overnight courier to the principal offices of the subject party. If any provision (or part of any provision) of this License, or the enforcement thereof, is held to be illegal, invalid, or unenforceable, then the parties shall renegotiate this License promptly and in good faith so as to place each of the parties, to the fullest extent legally possible, in substantially the same economic position as each of them would have been if such illegality, invalidity, or unenforceability had not occurred. Section and subsection headings in this License are included for convenience of reference only and shall not constitute part of this License for any other purpose or be given any substantive effect. This License may be executed in one or more counterparts all of which together shall constitute one original document. VISX, INCORPORATED LICENSEE Signature: Signature: /s/ Robert Helmer ---------------------------- ------------------------ Name: Name: Robert Helmer -------------------------------- ----------------------------- Title: Title: Chief Operating Officer -------------------------------- --------------------------- Date: Date: 5/11/01 -------------------------------- ----------------------------- 5 SCHEDULE A ---------- United States Patents Patent Name U.S. Patent No. - ----------- --------------- VISX Patents - ------------ Method for Ophthalmological Surgery 4,665,913 Method and Apparatus for Analysis and Correction 4,669,466 Abnormal Refractive Errors of the Eye Apparatus for Ophthalmological Surgery 4,718,418 Apparatus for Analysis and Correction of Abnormal Refractive 4,721,379 Errors of the Eye Apparatus for Performing Ophthalmic Laser Surgery 4,729,372 Method for Performing Ophthalmological Surgery 4,732,148 Method of Laser-Sculpture of the Optically Used Portion of 4,773,414 The Cornea Method of Laser-Sculpture of the Optically Used Portion of 4,798,204 The Cornea Ultraviolet Radiometer 4,885,471 Topography Measuring Apparatus 4,902,123 Method and Apparatus for Performing A Keratomileusis or the 4,903,695 Like Operation (includes LASIK) Eye Restraining Device 4,905,711 Sculpture Apparatus for Correcting Curvature of Cornea 4,911,711 Beam Intensity Profilometer 4,916,319 Topography Measuring Apparatus 4,993,826 Topography Measuring Apparatus 4,998,819 Gas Purging, Eye Fixation Hand Piece 5,009,660 Topography Measuring Apparatus 5,106,183 Laser Surgery Method (Includes LASIK) 5,108,388 Photorefractive Keratectomy 5,163,934 Method and Apparatus for Ophthalmologic Surgery 5,188,831 Method and Apparatus for Ophthalmologic Surgery 5,207,668 Apparatus for Performing Ophthalmologic Surgery 5,219,343 Method and Apparatus for Laser Sculpture of the Cornea 5,219,344 Apparatus for Perfoming Ophthalmological Surgery 5,312,320 Rectilinear Photokeratoscope 5,339,121 Ophthalmic Method for Laser Surgery of the Cornea 5,507,741 In Situ Astigmatism Axis Alignment 5,549,597 Method and System for Laser Treatment of Refractive Error 5,556,395 Using an Offset Image of a Rotatable Mask Method and Apparatus for Temporal and Spatial Beam Integration 5,646,791 Laser Surgery Apparatus and Method 5,711,762 Laser Surgery Apparatus and Method 5,735,843 Method and Apparatus for Temporal and Spatial Beam Integration 5,912,775 IBM Patent - ---------- Far Ultraviolet Surgical and Dental Procedures 4,784,135 6 Summit Patents - -------------- Laser Reprofiling Systems and Methods 4,856,513 Surface Erosion Using Lasers 4,941,093 Surgical Apparatus for Modifying the Curvature of the Eye Cornea 4,973,330 Surface Shaping Using Laser 4,994,058 LaserReprofiling system Employing an Erodable Mask 5,019,074 Optical System for Use in a Surgical Apparatus 5,147,352 Laser Reprofiling System Employing a Photodecomposable Mask 5,432,801 Laser Corneal Surgery 5,423,801 7 EX-10.7 13 file012.txt EQUIPMENT LEASE Exhibit 10.7 ------------ --------------------------------------------------- 555 West Arrow Highway 909-624-2020 Claremont, CA 91711 USA 909-338-2020 --------------------------------------------------- BAUSCH BAUSCH AND LOMB, INC. & LOMB RENT TO OWN PROGRAM - -------------------------------------------------------------------------------- Customer: Lasik America, Inc. Account Number: 146820 Address: 6644 Indian School Road NE City, State Zip: Albuquerque, NM 87110 Customer is a /s/Corporation (corporation, partnership, sole proprietor) -------------- - -------------------------------------------------------------------------------- This Agreement is entered into by BAUSCH AND LOMB, a New York corporation, with offices at 555 West Arrow Highway, Claremont California, 91711 (hereafter referred to as "B&L"), and the Customer listed above (hereafter referred to as "Customer"). Description of Program Under the program, Customer leases the Equipment for a term of six (6) months or longer. At the end of the lease, Customer has the option to purchase the B&L equipment set forth in III.2. A portion of the rental paid by Customer will then be credited toward Customer's payment of the Purchase Price, subject to the limits set forth in III.4. SCHEDULE "A" EQUIPMENT* - -------------------------------------------------------------------------------- QTY. PRODUCTS PRICES 1 Hansatome (R) Microkeratome Unit $40,000.00 VALUE OF EQUIPMENT INCLUDED HEREIN $40,000.00 - -------------------------------------------------------------------------------- 507-0028 Accuglide Blades $65.00 each - -------------------------------------------------------------------------------- *All references to Equipment in this Agreement refer to the Equipment as described in Schedule "A" above. - -------------------------------------------------------------------------------- I. Duties of Customer 1. Subject to the terms and conditions of this Agreement, Customer agrees to lease the Equipment from B&L for a period of six (6) months., commencing upon ---- --- installation of the Equipment (the "Term"). 2. Customer agrees to pay $1,800 per month to B&L as rental for the Equipment (the "Rental"), payable at the above address, in arrears, on or before the fifteenth (15th) day of the month following each month of the Term. 1 3. Customer agrees to pay any applicable state and local taxes on the leasing or purchase of the Equipment, and any shipping/return shipping charges. Tax exempt accounts will not be charged taxes. 4. Customer agrees to return the Equipment, at Customer's expense, at the end of the Term in good condition and repair, ordinary wear and tear excepted. 5. Customer authorizes and appoints B&L, and its agents, as Customer's attorney in fact, to execute and file, without Customer's involvement, any necessary UCC-1 Financing Statements and continuation statements, acknowledging that the Equipment listed in Schedule "A" is subject to a lease agreement between B&L and Customer, in order to protect the lessor interest of B&L in the Equipment. 6. Customer agrees that, for the period of this Agreement set forth above, Customer shall purchase all of its requirements for single-use disposable blades for use with the Hansatome (R) Microkeratome from B&L. Customer shall order Accuglide Blades at the price set forth in Schedule A. Accuglide (R) Blades shall be ordered by Customer and sold by B&L, and the purchase price therefor, in accordance with and subject to B&L's then current terms and conditions of sale. II. Duties of B&L 1. B&L agrees to perform initial start-up and installation of the Equipment. 2. B&L shall provide maintenance and repair service to the Equipment at its expense during the Term of this Agreement. III. Release of Obligation/Termination of Program 1. This program may be terminated at any time after six (6) months by either party upon ninety (90) days prior written notice, given in accordance with IV.8. 2. Upon termination of the Agreement or the end of the Term, Customer shall have the following options: (i) Purchase the B&L equipment for the purchase price stated in Schedule A; or (ii) return the Equipment to B&L ; or (iii)continue leasing the Equipment on a month-to-month basis, until terminated by either party upon ninety (90) days prior written notice. 3. Customer shall notify B&L no later than ninety (90) days prior to the end of the Term which option Customer plans to exercise. 4. In the event that Customer shall elect the option to purchase the equipment pursuant to Schedule A, B&L agrees to credit fifty percent (50%) of all Rentals paid toward Customer's payment of the Purchase Price. B&L shall promptly notify Customer by invoice of the balance due on the Purchase Price after applying the Credit, and Customer shall pay the invoice within thirty (30) days of its exercise of the option to purchase. 2 5. In the event that Customer shall fail to notify B&L of its election pursuant to III.3, the Agreement will continue on a month-to-month basis until terminated by either party upon ninety (90) days prior written notice. 6. In the event that Customer becomes a "debtor" in any proceeding under the federal Bankruptcy Act or any state insolvency law, or makes an assignment for the benefit of creditors, or is adjudicated bankrupt or insolvent, or admits in writing Customer's inability to pay its debts as they mature, this leases shall immediately terminate and the Equipment shall be returned to B&L. B&L shall have all of the rights and remedies of a secured creditor which are permitted or provided for under the Uniform Commercial Code, without the need of specifically enumerating them in this Agreement, including, but not necessarily limited to, the right to seize the Equipment without breach of peace. IV. General Terms 1. This Agreement is not assignable by Customer to a third party without the prior written consent of B&L. B&L may assign this Agreement to an affiliate or successor upon written notice to Customer. 2. Title to the Equipment shall remain with B&L throughout the term of this Agreement and Customer agrees to execute any documents requested by B&L to evidence same. 3. This Agreement is not binding upon B&L until accepted and executed on behalf of B&L at its office in Claremont, California. 4. This Agreement shall be construed in accordance with and governed by New York law. 5. This Agreement states the entire agreement of the parties with respect to the subject matter hereof, and all oral agreements, understandings and representations have been incorporated. 6. The prevailing party in any litigation brought under this Agreement shall be entitled to recover, as part of its judgment against the other, its reasonable attorneys' fees, costs and expenses. 7. Risk of loss to the Equipment is on Customer, and any such loss, damage or destruction will not have the effect of discharging any obligation of Customer under this Agreement. 8. Any notice hereunder will be in writing and will be effective when received at the address set forth above or, if sent by first class mail to such address, four (4) business days after deposit in the U.S. mails with postage prepaid. Either party, by notice, may change its address for receiving notices hereunder. 9. It is agreed that the terms, conditions and discounts granted in this Agreement are to remain confidential. They are not to be revealed to outside physicians, hospitals, ambulatory surgery centers, groups, vendors, or other outside resources unless required by law. 3 10. No failure or delay at any time by B&L to exercise any right hereunder, or to enforce any particular provision hereof, will be construed or operate as a waiver of its right to insist upon the strict performance of, or the enforcement of its rights with respect to, such provisions(s) or any other provisions(s) hereof at any time. Agreed to and accepted by authorized representatives of both parties as of the dates set forth below: B&L CUSTOMER: BAUSCH AND LOMB Lasik America, Inc. Signature: Signature: /s/ Howard Silverman --------------------------- -------------------------- Print Name: Ron Esola Print Name: Howard Silverman --------------------------- ------------------------- Title: Director, Commercial Operations Title: CEO -------------------------------- ------------------------------- Date: Date: 5/23/01 -------------------------------- ----------------------------- Telepnone: 800-521-2020 extension 1454 Telephone: 505-837-2020 ---------------------------- ------------------------ - ------------------------------------------------------------------------------- This Agreement offer valid through: May 31, 2001 - ------------------------------------------------------------------------------- 4 EX-23.1 14 file013.txt CONSENT OF INDEPENDENT PUBLIC ACCOUNTANT Exhibit 23.1 ------------ CONSENT OF INDEPENDENT PUBLIC ACCOUNTANT We consent to the use in Amendment 1 to the Form SB-2 of Lasik America, Inc. of our report dated August 13, 2001 (except for Note 8 as to which the date is August 24, 2001), relating to the financial statements of Lasik America, Inc., and to the reference to us under the heading "Experts" in such registration statement. San Diego, California PANNELL KERR FORSTER September 6, 2001 Certified Public Accountants A Professional Corporation -----END PRIVACY-ENHANCED MESSAGE-----