------------------------------------------


                           LOAN AND SECURITY AGREEMENT


                                  by and among


                            LASERSIGHT INCORPORATED,

                   each of its Subsidiaries signatory hereto,


                                       and


                          FOOTHILL CAPITAL CORPORATION


                           Dated as of March 31, 1997


                   ------------------------------------------





<PAGE>



                                TABLE OF CONTENTS
                                -----------------


1.       DEFINITIONS AND CONSTRUCTION
         1.1      Definitions
         1.2      Accounting Terms
         1.3      Code
         1.4      Construction
         1.5      Schedules and Exhibits

2.       LOAN AND TERMS OF PAYMENT
         2.1      Revolving Advances
         2.2      [Intentionally Omitted]
         2.3      Term Loan
         2.4      [Intentionally Omitted]
         2.5      Overadvances
         2.6      Interest:  Rates, Payments, and Calculations
         2.7      Collection of Accounts
         2.8      Crediting Payments; Application of Collections
         2.9      Designated Account
         2.10     Maintenance of Loan Account; Statements of Obligations
         2.11     Fees

3.       CONDITIONS; TERM OF AGREEMENT
         3.1      Conditions  Precedent to the Initial Advance and the Term Loan
         3.2      Conditions Precedent to all Advances and the Term Loan
         3.3      Conditions Subsequent
         3.4      Term
         3.5      Effect of Termination
         3.6      Early Termination by Borrower
         3.7      Termination Upon Event of Default

4.       CREATION OF SECURITY INTEREST
         4.1      Grant of Security Interest
         4.2      Negotiable Collateral
         4.3      Collection  of  Accounts, General  Intangibles, and Negotiable
                  Collateral
         4.4      Delivery of Additional Documentation Required
         4.5      Power of Attorney
         4.6      Right to Inspect


5.       REPRESENTATIONS AND WARRANTIES
         5.1      No Encumbrances
         5.2      Eligible Contract Receivables
         5.3      Purchase Agreements
         5.4      Equipment
         5.5      Location of Inventory and Equipment
         5.6      Inventory Records
         5.7      Location of Chief Executive Offices; FEINs
         5.8      Due Organization and Qualification; Subsidiaries
         5.9      Due Authorization; No Conflict
         5.10     Litigation
         5.11     No Material Adverse Change
         5.12     Solvency
         5.13     Employee Benefits
         5.14     Environmental Condition

6.       AFFIRMATIVE COVENANTS
         6.1      Accounting System
         6.2      Collateral Reporting
         6.3      Financial Statements, Reports, Certificates
         6.4      Tax Returns
         6.5      Guarantor Reports
         6.6      Returns
         6.7      [Intentionally Omitted]
         6.8      Maintenance of Equipment
         6.9      Taxes....
         6.10     Insurance
         6.11     No Setoffs or Counterclaims
         6.12     Location of Inventory and Equipment
         6.13     Compliance with Laws
         6.14     Employee Benefits
         6.15     Leases
         6.16     Purchase Agreements
         6.17     Broker Indemnity

7.       NEGATIVE COVENANTS
         7.1      Indebtedness
         7.2      Liens
         7.3      Restrictions on Fundamental Changes
         7.4      Disposal of Assets
         7.5      Change Name
         7.6      Guarantee
         7.7      Nature of Business
         7.8      Prepayments and Amendments
         7.9      Change of Control
         7.10     Consignments
         7.11     Distributions
         7.12     Accounting Methods
         7.13     Investments
         7.14     Transactions with Affiliates
         7.15     Suspension
         7.16     Compensation
         7.17     Use of Proceeds
         7.18     Change in  Location  of  Chief Executive Office; Inventory and
                  Equipment with Bailees
         7.19     No Prohibited Transactions Under ERISA
         7.20     Financial Covenants
         7.21     Capital Expenditures
         7.22     Non-Material Subsidiaries

8.       EVENTS OF DEFAULT

9.       FOOTHILL'S RIGHTS AND REMEDIES
         9.1      Rights and Remedies
         9.2      Remedies Cumulative

10.      TAXES AND EXPENSES

11.      WAIVERS; INDEMNIFICATION
         11.1     Demand; Protest; etc.
         11.2     Foothill's Liability for Collateral
         11.3     Indemnification

12.      NOTICES

13.      CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER

14.      DESTRUCTION OF BORROWER'S DOCUMENTS

15.      GENERAL PROVISIONS
         15.1     Effectiveness
         15.2     Successors and Assigns
         15.3     Section Headings
         15.4     Interpretation
         15.5     Severability of Provisions
         15.6     Amendments in Writing
         15.7     Counterparts; Telefacsimile Execution
         15.8     Revival and Reinstatement of Obligations
         15.9     Integration


                  SCHEDULES AND EXHIBITS
                  ----------------------

Schedule E-1                        Existing Purchase Agreements
Schedule N-1                        Non-Material Subsidiaries
Schedule P-1                        Permitted Liens
Schedule 5.3(b)                     Existing Purchase Agreement Defaults
Schedule 5.8                        Subsidiaries
Schedule 5.10                       Litigation
Schedule 5.13                       ERISA Benefit Plans
Schedule 6.12                       Location of Inventory and Equipment
Schedule 7.14(a)                    Existing Transactions with Affiliates

Exhibit C-1                         Form of Compliance Certificate



<PAGE>



                           LOAN AND SECURITY AGREEMENT
                           ---------------------------


     THIS LOAN AND SECURITY AGREEMENT (this "Agreement"),  is entered into as of
March 31, 1997, between FOOTHILL CAPITAL CORPORATION,  a California  corporation
("Foothill"),  with a place of business located at 11111 Santa Monica Boulevard,
Suite 1500, Los Angeles,  California 90025-3333, on the one hand, and LASERSIGHT
INCORPORATED,  a Delaware corporation  ("LaserSight"),  with its chief executive
office located at 12161 Lackland Road,  St. Louis,  Missouri  63146,  LASERSIGHT
TECHNOLOGIES,  INC.,  a Delaware  corporation  ("Technologies"),  with its chief
executive  office located at 12249 Science Drive,  Suite 160,  Orlando,  Florida
32826, MEC HEALTH CARE,  INC., a Maryland  corporation  ("MEC"),  with its chief
executive  office located at 100 Park Avenue,  Baltimore,  Maryland  21201,  LSI
ACQUISITION,  INC., a New Jersey corporation  ("LSI"),  with its chief executive
office located at 71 Second Street,  South Orange, New Jersey 07079,  LASERSIGHT
CENTERS  INCORPORATED,  a  Delaware  corporation  ("Centers"),  with  its  chief
executive office located at 12161 Lackland Road, St. Louis,  Missouri 63146, and
MRF,  INC., a Missouri  corporation  ("MRF"),  with its chief  executive  office
located at 12161 Lackland Road, St. Louis, Missouri 63146.

     The parties agree as follows:

     1. DEFINITIONS AND CONSTRUCTION.

        1.1  Definitions.  As used in this Agreement,  the following terms shall
have the following definitions:

             "Account  Debtor"  means  any  Person  who  is or  who  may  become
obligated  under,  with  respect  to, or on account  of, an Account or  contract
receivable.

             "Accounts"  means all  currently  existing  and  hereafter  arising
accounts,  contract  rights,  and all  other  forms  of  obligations  owing to a
Borrower  arising out of the sale or lease of goods or the rendition of services
by such Borrower, irrespective of whether earned by performance, and any and all
credit insurance, guaranties, or security therefor.

             "Advances" has the meaning set forth in Section 2.1(a).

             "Affiliate"  means, as applied to any Person,  any other Person who
directly or indirectly controls,  is controlled by, is under common control with
or is a director or officer of such  Person.  For  purposes of this  definition,
"control" means the possession, directly or indirectly, of the power to vote 10%
or more of the  securities  having  ordinary  voting  power for the  election of
directors or the direct or indirect  power to direct the management and policies
of a Person.

             "Agreement"  has the  meaning  set  forth in the  preamble  to this
Agreement.

             "Authorized  Person"  means  any  officer  or other  employee  of a
Borrower.

             "Bankruptcy  Code"  means the  United  States  Bankruptcy  Code (11
U.S.C.ss. 101 et seq.), as amended, and any successor statute.

             "Benefit  Plan"  means a  "defined  benefit  plan" (as  defined  in
Section 3(35) of ERISA) for which Borrower,  any Subsidiary of Borrower,  or any
ERISA  Affiliate  has been an  "employer"  (as defined in Section 3(5) of ERISA)
within the past six years.

             "Borrower" means LaserSight,  Technologies,  MEC, LSI, Centers, and
MRF, individually and collectively, jointly and severally.

             "Borrower's  Books"  means  all of  Borrower's  books  and  records
including:  ledgers; records indicating,  summarizing,  or evidencing Borrower's
properties or assets (including the Collateral) or liabilities;  all information
relating to  Borrower's  business  operations  or financial  condition;  and all
computer  programs,  disk or tape  files,  printouts,  runs,  or other  computer
prepared information.

             "Borrower  Letters of Credit"  means any and all  letters of credit
under which Borrower is the beneficiary.

             "Borrowing Base" has the meaning set forth in Section 2.1(a).

             "Business  Day" means any day that is not a  Saturday,  Sunday,  or
other day on which national banks are authorized or required to close.

             "Centers"  has  the  meaning  set  forth  in the  preamble  to this
Agreement.

             "Change of Control"  shall be deemed to have  occurred at such time
as a "person" or "group"  (within the meaning of Sections  13(d) and 14(d)(2) of
the Securities  Exchange Act of 1934) becomes the "beneficial owner" (as defined
in  Rule  13d-3  under  the  Securities  Exchange  Act  of  1934),  directly  or
indirectly,  of more than 20% of the total  voting power of all classes of stock
then outstanding of any Borrower entitled to vote in the election of directors.

             "Closing  Date"  means the date of the first to occur of the making
of the initial Advance or the funding of the Term Loan.

             "Code" means the California Uniform Commercial Code.

             "Collateral" means each of the following:

             (a) the Accounts,

             (b) Borrower's Books,

             (c) the Equipment,

             (d) the General Intangibles,

             (e) the Inventory,

             (f) the Negotiable Collateral,

             (g) any money,  or other  assets of Borrower  that now or hereafter
come into the possession, custody, or control of Foothill, and

             (h) the proceeds and products,  whether tangible or intangible,  of
any of the foregoing, including proceeds of insurance covering any or all of the
Collateral,  and any and all  Accounts,  Borrower's  Books,  Equipment,  General
Intangibles, Inventory, Negotiable Collateral, money, deposit accounts, or other
tangible or intangible property resulting from the sale,  exchange,  collection,
or other disposition of any of the foregoing, or any portion thereof or interest
therein, and the proceeds thereof.

             "Collateral  Access  Agreement" means a landlord waiver,  mortgagee
waiver,  bailee  letter,  or  acknowledgement  agreement  of  any  warehouseman,
processor,  lessor,  consignee,  or other Person in possession of, having a Lien
upon, or having rights or interests in the Equipment or Inventory, in each case,
in form and substance satisfactory to Foothill.

             "Collections" means all cash, checks, notes, instruments, and other
items of payment (including,  insurance proceeds, proceeds of cash sales, rental
proceeds, and tax refunds).

             "Commitment  Letter"  means that certain  letter  agreement,  dated
March 12, 1997, from Foothill to LaserSight,  which letter  agreement sets forth
the terms and  conditions  of the credit  facility to be extended by Foothill to
Borrower.

             "Compliance  Certificate" means a certificate  substantially in the
form of Exhibit C-1 and delivered by the chief  financial  officer of LaserSight
to Foothill.

             "Consolidated   Current   Assets"   means,   as  of  any   date  of
determination,  the  aggregate  amount of all current  assets of  Borrower  that
would,  in  accordance  with GAAP,  be  classified on a balance sheet as current
assets.

             "Consolidated  Current  Liabilities"  means,  as  of  any  date  of
determination,  the aggregate amount of all current liabilities of Borrower that
would,  in  accordance  with GAAP,  be  classified on a balance sheet as current
liabilities.  For purposes of this definition, all Obligations outstanding under
this  Agreement  shall be deemed to be  current  liabilities  without  regard to
whether they would be deemed to be so under GAAP.

             "Copyright   Security   Agreement"  means  that  certain  Copyright
Security Agreement, in form and substance satisfactory to Foothill, executed and
delivered by each Borrower.

             "Daily  Balance" means the amount of an Obligation  owed at the end
of a given day.

             "deems itself insecure" means that the Person deems itself insecure
in accordance with the provisions of Section 1208 of the Code.

             "Default"  means an event,  condition,  or default  that,  with the
giving of notice, the passage of time, or both, would be an Event of Default.

             "Designated  Account" means account  number  3410627712 of Borrower
maintained  with  Borrower's  Designated  Account  Bank,  or such other  deposit
account  of  Borrower   (located  within  the  United  States)  which  has  been
designated, in writing and from time to time, by Borrower to Foothill.

             "Designated  Account  Bank" means Mark Twain Bank,  whose office is
located at  Clarkson  Square,  1795  Clarkson  Road,  Suite  100,  Chesterfield,
Missouri 63017, and whose ABA number is 081-003-408.

             "Disbursement  Letter" means an  instructional  letter executed and
delivered by Borrower to Foothill  regarding the extensions of credit to be made
on the Closing Date,  the form and substance of which shall be  satisfactory  to
Foothill.

             "Dollars or $" means United States dollars.

             "Early  Termination  Premium"  has the meaning set forth in Section
3.6.

             "EBITDA"  means the  consolidated  net income of  Borrower  and its
Subsidiaries (excluding  extraordinary gains, non-cash extraordinary losses, and
non-operating  income)  for the  applicable  period plus all  interest  expense,
income tax expense,  non-operating  expenses,  and depreciation and amortization
(including amortization of any goodwill or other intangibles) for the applicable
period.

             "Eligible  Contract  Receivables"  means Eligible Existing Contract
Receivables and Eligible New Contract Receivables.

             "Eligible  Existing  Contract  Receivables"  means  those  contract
receivables  (net of commissions,  unapplied  cash, and financing  discounts and
charges)  created by  Technologies in the ordinary course of business that arise
out of Technologies'  sale of goods pursuant to an Existing Purchase  Agreement,
that strictly  comply with each and all of the  representations  and  warranties
respecting  Eligible  Contract  Receivables  made by Borrower to Foothill in the
Loan  Documents,  and that are and at all times  continue  to be  acceptable  to
Foothill in all respects;  provided,  however, that standards of eligibility may
be fixed and  revised  from time to time by Foothill  in  Foothill's  reasonable
credit judgment.  Eligible Existing  Contract  Receivables shall not include the
following:

             (a) Contract  receivables (i) that the Account Debtor has failed to
pay  within 60 days of the  payment  date set forth in the  respective  Purchase
Agreement,  or (ii) that are payable under a  restructured  Purchase  Agreement,
until such time as the Account  Debtor has made the initial  payment  thereunder
within  60 days of the  payment  date set forth in the  respective  restructured
Purchase Agreement;

             (b)  Contract   receivables  owed  by  an  Account  Debtor  or  its
Affiliates  where 50% or more of all contract  receivables  owed by that Account
Debtor (or its Affiliates) are deemed ineligible under clause (a) above;

             (c) Contract  receivables  with respect to which the Account Debtor
is an employee, Affiliate, or agent of Borrower;

             (d) Contract  receivables with respect to which goods are placed on
consignment,  guaranteed sale, sale or return, sale on approval,  bill and hold,
or other  terms by reason of which the  payment  by the  Account  Debtor  may be
conditional;

             (e) Contract  receivables  with respect to which the Account Debtor
is either (i) the United States or any department, agency, or instrumentality of
the United States (exclusive,  however, of contract  receivables with respect to
which  Technologies  has complied,  to the  satisfaction  of Foothill,  with the
Assignment of Claims Act, 31 U.S.C.  ss. 3727),  or (ii) any State of the United
States (exclusive,  however, of contract receivables owed by any State that does
not have a statutory counterpart to the Assignment of Claims Act);

             (f) Contract  receivables  with respect to which the Account Debtor
is a creditor of Borrower,  has or has asserted a right of setoff,  has disputed
its liability, or has made any claim with respect to the contract receivables;

             (g) Contract  receivables  with respect to an Account  Debtor whose
total  obligations  owing to  Technologies  exceed 10% of all Eligible  Contract
Receivables,  to the extent of the  obligations  owing by such Account Debtor in
excess of such percentage;

             (h) Contract  receivables  with respect to which the Account Debtor
is subject to any Insolvency  Proceeding,  or becomes insolvent,  or goes out of
business;

             (i) Contract  receivables the collection of which Foothill,  in its
reasonable  credit  judgment,  believes  to be doubtful by reason of the Account
Debtor's financial condition;

             (j)  Contract  receivables  with  respect to which the goods giving
rise to such  contract  receivables  have not been  shipped  and  billed  to the
Account Debtor,  the services giving rise to such contract  receivables have not
been performed and accepted by the Account Debtor,  or the contract  receivables
otherwise do not represent a final sale; and

             (k) Contract receivables that are evidenced by a Purchase Agreement
that is not in Foothill's possession and control.

             "Eligible   New   Contract   Receivables"   means  those   contract
receivables  (net of commissions,  unapplied  cash, and financing  discounts and
charges)  created by  Technologies in the ordinary course of business that arise
out of Technologies' sale of goods pursuant to a Purchase Agreement entered into
by  Technologies  and an  Account  Debtor on or after  the  Closing  Date,  that
strictly  comply  with  each  and  all of  the  representations  and  warranties
respecting  Eligible  Contract  Receivables  made by Borrower to Foothill in the
Loan  Documents,  and that are and at all times  continue  to be  acceptable  to
Foothill in all respects;  provided,  however, that standards of eligibility may
be fixed and  revised  from time to time by Foothill  in  Foothill's  reasonable
credit  judgment.  Eligible  New  Contract  Receivables  shall not  include  the
following:

             (a) Contract  receivables (i) that the Account Debtor has failed to
pay  within 60 days of the  payment  date set forth in the  respective  Purchase
Agreement, (ii) that are payable under a restructured Purchase Agreement,  until
such time as the Account Debtor has made the initial payment  thereunder  within
60 days of the payment date set forth in the  respective  restructured  Purchase
Agreement, or (iii) with selling terms of more than 24 months;

             (b)  Contract   receivables  owed  by  an  Account  Debtor  or  its
Affiliates  where 50% or more of all contract  receivables  owed by that Account
Debtor (or its Affiliates) are deemed ineligible under clause (a) above;

             (c) Contract  receivables  with respect to which the Account Debtor
is an employee, Affiliate, or agent of Borrower;

             (d) Contract  receivables with respect to which goods are placed on
consignment,  guaranteed sale, sale or return, sale on approval,  bill and hold,
or other  terms by reason of which the  payment  by the  Account  Debtor  may be
conditional;

             (e) Contract  receivables  with respect to which the Account Debtor
is either (i) the United States or any department, agency, or instrumentality of
the United States (exclusive,  however, of contract  receivables with respect to
which  Technologies  has complied,  to the  satisfaction  of Foothill,  with the
Assignment of Claims Act, 31 U.S.C.  ss. 3727),  or (ii) any State of the United
States (exclusive,  however, of contract receivables owed by any State that does
not have a statutory counterpart to the Assignment of Claims Act);

             (f) Contract  receivables  with respect to which the Account Debtor
is a creditor of Borrower,  has or has asserted a right of setoff,  has disputed
its liability, or has made any claim with respect to the contract receivables;

             (g) Contract  receivables  with respect to an Account  Debtor whose
total  obligations  owing to  Technologies  exceed 10% of all Eligible  Contract
Receivables,  to the extent of the  obligations  owing by such Account Debtor in
excess of such percentage;

             (h) Contract  receivables  with respect to which the Account Debtor
is subject to any Insolvency  Proceeding,  or becomes insolvent,  or goes out of
business;

             (i) Contract  receivables the collection of which Foothill,  in its
reasonable  credit  judgment,  believes  to be doubtful by reason of the Account
Debtor's financial condition;

             (j)  Contract  receivables  with  respect to which the goods giving
rise to such  contract  receivables  have not been  shipped  and  billed  to the
Account Debtor,  the services giving rise to such contract  receivables have not
been performed and accepted by the Account Debtor,  or the contract  receivables
otherwise do not represent a final sale; and

             (k) Contract receivables that are evidenced by a Purchase Agreement
that is not in Foothill's possession and control.

             "Equipment"  means all of each  Borrower's  present  and  hereafter
acquired machinery,  machine tools, motors, equipment,  furniture,  furnishings,
fixtures,  vehicles (including motor vehicles and trailers), tools, parts, goods
(other than consumer  goods,  farm products,  or Inventory),  wherever  located,
including,  (a) any interest of a Borrower in any of the foregoing,  and (b) all
attachments,  accessories, accessions, replacements,  substitutions,  additions,
and improvements to any of the foregoing.

             "ERISA" means the Employee  Retirement Income Security Act of 1974,
29 U.S.C.  ss.ss. 1000 et seq.,  amendments  thereto,  successor  statutes,  and
regulations or guidance promulgated thereunder.

             "ERISA Affiliate" means (a) any corporation  subject to ERISA whose
employees  are  treated as employed by the same  employer  as the  employees  of
Borrower under IRC Section  414(b),  (b) any trade or business  subject to ERISA
whose employees are treated as employed by the same employer as the employees of
Borrower  under IRC Section  414(c),  (c) solely for  purposes of Section 302 of
ERISA and Section 412 of the IRC,  any  organization  subject to ERISA that is a
member of an affiliated  service  group of which  Borrower is a member under IRC
Section  414(m),  or (d) solely for purposes of Section 302 of ERISA and Section
412 of the IRC,  any party  subject to ERISA  that is a party to an  arrangement
with Borrower and whose  employees are aggregated with the employees of Borrower
under IRC Section 414(o).

             "ERISA  Event"  means (a) a  Reportable  Event with  respect to any
Benefit Plan or Multiemployer  Plan, (b) the withdrawal of Borrower,  any of its
Subsidiaries or ERISA Affiliates from a Benefit Plan during a plan year in which
it was a "substantial employer" (as defined in Section 4001(a)(2) of ERISA), (c)
the  providing  of notice of intent to  terminate  a Benefit  Plan in a distress
termination (as described in Section  4041(c) of ERISA),  (d) the institution by
the PBGC of proceedings to terminate a Benefit Plan or  Multiemployer  Plan, (e)
any event or condition (i) that provides a basis under Section 4042(a)(1),  (2),
or (3) of ERISA for the  termination  of,  or the  appointment  of a trustee  to
administer,  any Benefit Plan or Multiemployer  Plan, or (ii) that may result in
termination of a Multiemployer  Plan pursuant to Section 4041A of ERISA, (f) the
partial or complete  withdrawal  within the meaning of Sections 4203 and 4205 of
ERISA,  of  Borrower,  any  of  its  Subsidiaries  or  ERISA  Affiliates  from a
Multiemployer  Plan,  or (g)  providing  any security to any Plan under  Section
401(a)(29)  of the IRC by  Borrower  or its  Subsidiaries  or any of their ERISA
Affiliates.

             "Event of Default" has the meaning set forth in Section 8.

             "Existing  Lender" means,  collectively,  Mark B. Gordon,  O.D. and
Howard H. Levin, O.D.

             "Existing  Purchase   Agreements"  means  the  purchase  agreements
identified on Schedule E-1.

             "FEIN" means Federal Employer Identification Number.

             "Foothill"  has the  meaning  set  forth  in the  preamble  to this
Agreement.

             "Foothill Account" has the meaning set forth in Section 2.7.

             "Foothill  Expenses"  means all:  (a) costs or expenses  (including
taxes, and insurance  premiums) required to be paid by Borrower under any of the
Loan Documents  that are paid or incurred by Foothill;  (b) fees or charges paid
or  incurred  by  Foothill  in  connection  with  Foothill's  transactions  with
Borrower,  including  (i) fees or  charges  for  appraisal  (including  periodic
Collateral appraisals),  real estate surveys, and environmental audits, and (ii)
reasonable  fees  or  charges  for  photocopying,   notarization,  couriers  and
messengers,  telecommunication,  public  record  searches  (including  tax lien,
litigation,  and UCC  searches  and  including  searches  with  the  patent  and
trademark  office,  the copyright  office, or the department of motor vehicles),
filing, recording, publication, and real estate title policies and endorsements;
(c) costs and  expenses  incurred by Foothill  in the  disbursement  of funds to
Borrower  (by wire  transfer  or  otherwise);  (d)  charges  paid or incurred by
Foothill  resulting  from the  dishonor  of  checks;  (e)  reasonable  costs and
expenses  paid or  incurred  by  Foothill  to correct any default or enforce any
provision  of the Loan  Documents,  or in gaining  possession  of,  maintaining,
handling,  preserving,  storing,  shipping,  selling,  preparing  for  sale,  or
advertising to sell the  Collateral,  or any portion  thereof,  irrespective  of
whether a sale is  consummated;  (f)  costs and  expenses  paid or  incurred  by
Foothill in examining  Borrower's  Books;  (g) reasonable  costs and expenses of
third party  claims or any other suit paid or incurred by Foothill in  enforcing
or  defending  the  Loan  Documents  or  in  connection  with  the  transactions
contemplated by the Loan Documents or Foothill's  relationship  with Borrower or
any  guarantor;  and (h)  Foothill's  reasonable  attorneys  fees  and  expenses
incurred in advising, structuring, drafting, reviewing, administering, amending,
terminating,  enforcing  (including  attorneys  fees and  expenses  incurred  in
connection  with a "workout," a  "restructuring,"  or an  Insolvency  Proceeding
concerning  Borrower  or  any  guarantor  of  the  Obligations),  defending,  or
concerning the Loan Documents, irrespective of whether suit is brought.

             "GAAP" means generally accepted accounting  principles as in effect
from time to time in the United States, consistently applied.

             "General  Intangibles"  means all of each  Borrower's  present  and
future general  intangibles  and other  personal  property  (including  contract
rights,  rights arising under common law,  statutes,  or regulations,  choses or
things in action,  goodwill,  patents,  trade names,  trademarks,  servicemarks,
copyrights, blueprints, drawings, purchase orders, customer lists, monies due or
recoverable from pension funds, route lists,  rights to payment and other rights
under  any  royalty  or  licensing  agreements,  infringement  claims,  computer
programs, information contained on computer disks or tapes, literature, reports,
catalogs,  deposit  accounts,  insurance premium rebates,  tax refunds,  and tax
refund claims), other than goods, Accounts, and Negotiable Collateral.

             "Governing   Documents"   means  the  certificate  or  articles  of
incorporation,  by-laws,  or other  organizational or governing documents of any
Person.

             "Guarantor"  means LST Laser,  S.A.  (Costa  Rica),  a  corporation
organized under the laws of Costa Rica.

             "Guaranty" means that certain General Continuing Guaranty,  in form
and substance  satisfactory to Foothill,  executed and delivered by Guarantor in
favor of Foothill.

             "Hazardous  Materials"  means (a)  substances  that are  defined or
listed  in,  or  otherwise  classified  pursuant  to,  any  applicable  laws  or
regulations  as  "hazardous   substances,"   "hazardous  materials,"  "hazardous
wastes," "toxic substances," or any other formulation  intended to define, list,
or classify substances by reason of deleterious properties such as ignitability,
corrosivity,   reactivity,   carcinogenicity,   reproductive  toxicity,  or  "EP
toxicity",  (b) oil, petroleum,  or petroleum derived  substances,  natural gas,
natural gas liquids,  synthetic gas, drilling fluids, produced waters, and other
wastes associated with the exploration, development, or production of crude oil,
natural gas, or geothermal resources, (c) any flammable substances or explosives
or any  radioactive  materials,  and (d)  asbestos  in any  form  or  electrical
equipment  that  contains  any oil or  dielectric  fluid  containing  levels  of
polychlorinated biphenyls in excess of 50 parts per million.

             "IBM" means International Business Machines Corporation, a New York
corporation.

             "IBM  Consent"  means that certain  letter of consent,  dated as of
March 31, 1997,  executed and  delivered by IBM to Foothill and  LaserSight,  in
form and substance satisfactory to Foothill.

             "IBM License Agreement" means that certain  Agreement,  dated as of
April 1, 1992, by and between LaserSight and IBM, pursuant to which IBM licensed
the right to use certain patents to LaserSight.

             "IBM Option  Agreement" means that certain  Agreement,  dated as of
January  1, 1997,  by and  between  Lasersight  and IBM,  pursuant  to which (a)
LaserSight  may  acquire  certain  IBM patents  relating  to  ultraviolet  light
ophthalmic products and procedures,  and (b) IBM will transfer to LaserSight all
of IBM's rights under  certain of IBM's patent  license  agreements  with Summit
Technology, Inc. and VISX, Inc.

             "Indebtedness"  means: (a) all obligations of Borrower for borrowed
money, (b) all obligations of Borrower evidenced by bonds, debentures, notes, or
other similar instruments and all reimbursement or other obligations of Borrower
in respect of letters of credit,  bankers  acceptances,  interest rate swaps, or
other financial products,  (c) all obligations of Borrower under capital leases,
(d) all  obligations  or liabilities of others secured by a Lien on any property
or asset of Borrower,  irrespective  of whether such  obligation or liability is
assumed,  and (e)  any  obligation  of  Borrower  guaranteeing  or  intended  to
guarantee  (whether  guaranteed,  endorsed,  co-made,  discounted,  or sold with
recourse to Borrower) any indebtedness,  lease,  dividend,  letter of credit, or
other obligation of any other Person.

             "Insolvency  Proceeding"  means  any  proceeding  commenced  by  or
against any Person under any provision of the Bankruptcy Code or under any other
bankruptcy or insolvency law,  assignments for the benefit of creditors,  formal
or informal moratoria,  compositions,  extensions  generally with creditors,  or
proceedings seeking reorganization, arrangement, or other similar relief.

             "Intangible Assets" means, with respect to any Person, that portion
of the book  value of all of such  Person's  assets  that  would be  treated  as
intangibles under GAAP.

             "Intercompany  Agreement" means an agreement  between  Technologies
and Guarantor,  in form and substance  satisfactory to Foothill,  whereby, among
other things,  Technologies and Guarantor  clarify their  respective  rights and
interests  in  and  to  ophthalmic   lasers  and  related  products   developed,
manufactured,  sold,  leased,  or licensed by  Technologies or Guarantor and the
Inventory,  Accounts,  and contract receivables related to the assembly and sale
thereof.

             "Inventory"  means all  present  and  future  inventory  in which a
Borrower  has any  interest,  including  goods  held  for sale or lease or to be
furnished under a contract of service and all of a Borrower's present and future
raw  materials,  work in process,  finished  goods,  and  packing  and  shipping
materials, wherever located.

             "Investment  Property" means "investment  property" as that term is
defined in Section 9115 of the Code.

             "IRC" means the Internal Revenue Code of 1986, as amended,  and the
regulations thereunder.

             "LaserSight"  has the  meaning  set forth in the  preamble  to this
Agreement.

             "Lien" means any interest in property  securing an obligation  owed
to, or a claim by, any Person other than the owner of the property, whether such
interest shall be based on the common law,  statute,  or contract,  whether such
interest  shall be recorded or  perfected,  and whether such  interest  shall be
contingent  upon the  occurrence of some future event or events or the existence
of some future  circumstance  or  circumstances,  including the lien or security
interest  arising  from  a  mortgage,  deed  of  trust,   encumbrance,   pledge,
hypothecation,  assignment,  deposit  arrangement,  security agreement,  adverse
claim  or  charge,   conditional  sale  or  trust  receipt,  or  from  a  lease,
consignment,  or bailment for security purposes and also including reservations,
exceptions,  encroachments,  easements,  rights-of-way,  covenants,  conditions,
restrictions, leases, and other title exceptions and encumbrances affecting real
property.

             "Loan Account" has the meaning set forth in Section 2.10.

             "Loan Documents" means this Agreement, the Disbursement Letter, the
Lockbox  Agreements,  the Guaranty,  the Stock Pledge  Agreement,  the Copyright
Security  Agreement,  the Patent  Security  Agreement,  the  Trademark  Security
Agreement,  the Warrants, the Suretyship Agreement, the IBM Consent, any note or
notes  executed by a Borrower and payable to Foothill,  and any other  agreement
entered into, now or in the future, in connection with this Agreement.

             "Lockbox  Account"  shall  mean a  depositary  account  established
pursuant to one of the Lockbox Agreements.

             "Lockbox   Agreements"   means  those  certain  Lockbox   Operating
Procedural  Agreements and those certain Depository Account Agreements,  in form
and  substance  satisfactory  to  Foothill,  each of which  is  among  Borrower,
Foothill, and one of the Lockbox Banks.

             "Lockbox Banks" means Mercantile Bank of St. Louis, N.A.

             "Lockboxes" has the meaning set forth in Section 2.7.

             "LSI" has the meaning set forth in the preamble to this Agreement.

             "Material  Adverse  Change" means (a) a material  adverse change in
the business, prospects,  operations, results of operations, assets, liabilities
or condition (financial or otherwise) of LaserSight and its Subsidiaries,  taken
as a whole, (b) the material  impairment of the ability of Borrower,  taken as a
whole,  to perform its  obligations  under the Loan  Documents  to which it is a
party or of Foothill to enforce the  Obligations or realize upon the Collateral,
(c) a material  adverse effect on the value of the Collateral or the amount that
Foothill  would be likely to receive  (after giving  consideration  to delays in
payment and costs of enforcement) in the liquidation of such Collateral,  or (d)
a material  impairment of the priority of  Foothill's  Liens with respect to the
Collateral.

             "Maturity Date" has the meaning set forth in Section 3.4.

             "Maximum Amount" means, as of any date of determination, the sum of
(a) the Maximum Revolving Amount, and (b) the then outstanding principal balance
of the Term Loan.

             "Maximum  Revolving  Amount" means $4,000,000;  provided,  however,
that, commencing on the first day of the seventeenth month following the Closing
Date and continuing on the first day of each succeeding  month,  the then extant
Maximum Revolving Amount shall be reduced by $1,333,000;  provided further, that
the Maximum Revolving Amount shall be reduced to zero on the Maturity Date.

             "MEC" has the meaning set forth in the preamble to this Agreement.

             "MRF" has the meaning set forth in the preamble to this Agreement.

             "Multiemployer  Plan" means a  "multiemployer  plan" (as defined in
Section 4001(a)(3) of ERISA) to which Borrower, any of its Subsidiaries,  or any
ERISA Affiliate has contributed, or was obligated to contribute, within the past
six years.

             "Negotiable  Collateral" means all of a Person's present and future
letters of credit  (including the Borrower  Letters of Credit),  notes,  drafts,
instruments,  Investment Property,  documents, personal property leases (wherein
such Person is the  lessor),  chattel  paper,  and Books  relating to any of the
foregoing.

             "Non-Material   Subsidiary"  means  any  Subsidiary  identified  on
Schedule N-1 attached hereto.

             "Obligations" means all loans, Advances, debts, principal, interest
(including any interest  that,  but for the  provisions of the Bankruptcy  Code,
would  have  accrued),   premiums   (including  Early   Termination   Premiums),
liabilities  (including all amounts charged to Borrower's Loan Account  pursuant
hereto), obligations,  fees, charges, costs, or Foothill Expenses (including any
fees or expenses that, but for the provisions of the Bankruptcy Code, would have
accrued), lease payments, guaranties, covenants, and duties owing by Borrower to
Foothill of any kind and  description  (whether  pursuant to or evidenced by the
Loan Documents or pursuant to any other agreement between Foothill and Borrower,
and  irrespective  of  whether  for the  payment of  money),  whether  direct or
indirect,  absolute  or  contingent,  due or to  become  due,  now  existing  or
hereafter arising, and including any debt,  liability,  or obligation owing from
Borrower to others that  Foothill may have  obtained by assignment or otherwise,
and further  including all interest not paid when due and all Foothill  Expenses
that Borrower is required to pay or reimburse by the Loan Documents,  by law, or
otherwise.

             "Overadvance" has the meaning set forth in Section 2.5.

             "Participant"  means  any  Person  to  which  Foothill  has  sold a
participation interest in its rights under the Loan Documents.

             "Patent  Security  Agreement"  means that certain  Patent  Security
Agreement,  in  form  and  substance  satisfactory  to  Foothill,  executed  and
delivered by each Borrower.

             "Pay-Off Letter" means a letter,  in form and substance  reasonably
satisfactory to Foothill,  from Existing Lender  respecting the amount necessary
to repay in full all of the obligations of Borrower owing to Existing Lender and
obtain  a  termination  or  release  of all of the  Liens  existing  in favor of
Existing  Lender in and to the  properties or assets of Borrower,  including the
capital stock of MEC.

             "PBGC" means the Pension Benefit Guaranty Corporation as defined in
Title IV of ERISA, or any successor thereto.

             "Permitted Dispositions" means: (a) the sale of Inventory to buyers
in the  ordinary  course  of  business;  (b) the  sale or other  disposition  of
obsolete or substantially worn-out Equipment in the ordinary course of business;
and (c) the sale of  Technologies  if and only if this  Agreement is  terminated
pursuant  to  Section  3.4 and all  Obligations  have  been  fully  and  finally
discharged.

             "Permitted Patent Acquisition Transaction" means the acquisition of
the patents and related rights  contemplated under the IBM Option Agreement made
by: (a) a joint venture including Borrower (the "Joint Venture"), so long as (i)
Borrower  has granted to  Foothill a security  interest  with  respect to all of
Borrower's  right,  title,  and interest in and to the Joint  Venture,  (ii) the
Joint Venture and Technologies have executed and delivered a license  agreement,
in form and  substance  satisfactory  to  Foothill,  pursuant to which the Joint
Venture  licenses to  Technologies  the right to use the acquired  patents,  and
(iii)  Technologies  has granted to  Foothill a security  interest in all of its
right, title, and interest in and to such licenses;  or (b) LaserSight utilizing
the proceeds of purchase  money  financing from a Person (that is not a Borrower
or an  Affiliate  thereof),  so long as (i)  LaserSight  and  Technologies  have
executed and delivered a license agreement,  in form and substance  satisfactory
to Foothill,  pursuant to which LaserSight licenses to Technologies the right to
use the acquired  patents,  (ii) Technologies has granted to Foothill a security
interest in all of its right,  title, and interest in and to such licenses,  and
(iii) if such purchase money lender  requires the  subordination  by Foothill of
Foothill's  security  interest in the acquired patents in favor of the interests
therein  of such  purchase  money  lender  (the  terms and  conditions  of which
subordination shall be reasonably satisfactory to Foothill), such purchase money
lender has executed and delivered a non-disturbance and attornment agreement, in
form and substance  satisfactory to Foothill, in respect of the licenses granted
by LaserSight to Technologies pursuant to clause (b)(i) above.

             "Permitted  Liens" means (a) Liens held by Foothill,  (b) Liens for
unpaid taxes that either (i) are not yet due and payable or (ii) are the subject
of Permitted Protests, (c) Liens set forth on Schedule P-1, (d) the interests of
lessors under operating leases and purchase money Liens of lessors under capital
leases to the extent that the  acquisition or lease of the  underlying  asset is
permitted  under Section 7.21 and so long as the Lien only attaches to the asset
purchased  or acquired and only  secures the  purchase  price of the asset,  (e)
Liens arising by operation of law in favor of warehousemen, landlords, carriers,
mechanics, materialmen,  laborers, or suppliers, incurred in the ordinary course
of business of Borrower and not in connection  with the borrowing of money,  and
which  Liens  either (i) are for sums not yet due and  payable,  or (ii) are the
subject  of  Permitted  Protests,  (f)  Liens  arising  from  deposits  made  in
connection with obtaining worker's compensation or other unemployment insurance,
(g) Liens or deposits to secure performance of bids,  tenders, or leases (to the
extent  permitted  under this  Agreement),  incurred in the  ordinary  course of
business of Borrower and not in  connection  with the  borrowing  of money,  (h)
Liens  arising by reason of security  for surety or appeal bonds in the ordinary
course of business of Borrower,  (i) Liens of or resulting  from any judgment or
award that would not  result in a  Material  Adverse  Change and as to which the
time for the appeal or petition for  rehearing of which has not yet expired,  or
in  respect  of  which  Borrower  is in good  faith  prosecuting  an  appeal  or
proceeding  for a review,  and in respect of which a stay of  execution  pending
such appeal or proceeding  for review has been secured,  (j) with respect to any
real  property,  easements,  rights of way,  zoning and  similar  covenants  and
restrictions,  and similar  encumbrances that customarily exist on properties of
Persons  engaged in similar  activities  and similarly  situated and that in any
event do not  materially  interfere  with or impair the use or  operation of the
Collateral  by Borrower or the value of Foothill's  Lien thereon or therein,  or
materially interfere with the ordinary conduct of the business of Borrower,  and
(k) the purchase  money Lien,  if any, of a Person (that is not a Borrower or an
Affiliate thereof) on the patents and related rights  contemplated under the IBM
Option  Agreement  and  acquired  pursuant  to clause (b) of the  definition  of
"Permitted Patent Acquisition Transaction", so long as the Lien only attaches to
the asset  purchased  or acquired  and any  royalties  derived  from the license
thereof and only secures the purchase price of the asset.

             "Permitted Protest" means the right of Borrower to protest any Lien
other than any such Lien that secures the  Obligations,  tax (other than payroll
taxes or taxes that are the subject of a United  States  federal  tax lien),  or
rental  payment,  provided that (a) a reserve with respect to such obligation is
established   on  the  books  of  Borrower  in  an  amount  that  is  reasonably
satisfactory  to Foothill,  (b) any such protest is  instituted  and  diligently
prosecuted by Borrower in good faith,  and (c) Foothill is satisfied that, while
any such protest is pending,  there will be no impairment of the enforceability,
validity, or priority of any of the Liens of Foothill in and to the Collateral.

             "Person" means and includes natural persons, corporations,  limited
liability  companies,  limited  partnerships,   general  partnerships,   limited
liability partnerships, joint ventures, trusts, land trusts, business trusts, or
other  organizations,  irrespective  of  whether  they are legal  entities,  and
governments and agencies and political subdivisions thereof.

             "Plan" means any employee  benefit plan,  program,  or  arrangement
maintained or  contributed  to by Borrower or with respect to which it may incur
liability.

             "Purchase   Agreement"   means  a   purchase   agreement   used  by
Technologies  in  connection  with  Technologies'  sale of goods or rendition of
services, which agreement shall be assignable by its terms.

             "Reference  Rate" means the variable  rate of interest,  per annum,
most recently announced by Norwest Bank Minnesota,  National Association, or any
successor  thereto,  as its "base rate,"  irrespective of whether such announced
rate is the best rate available from such financial institution.

             "Reportable  Event"  means any of the events  described  in Section
4043(c) of ERISA or the regulations  thereunder other than a Reportable Event as
to which the provision of 30 days notice to the PBGC is waived under  applicable
regulations.

             "Retiree  Health Plan" means an  "employee  welfare  benefit  plan"
within  the  meaning  of  Section  3(1)  of  ERISA  that  provides  benefits  to
individuals  after  termination of their  employment,  other than as required by
Section 601 of ERISA.

             "Solvent"  means,  with respect to any Person on a particular date,
that on such date (a) at fair  valuations,  all of the  properties and assets of
such  Person  are  greater  than  the  sum of the  debts,  including  contingent
liabilities,  of  such  Person,  (b)  the  present  fair  salable  value  of the
properties  and assets of such  Person is not less than the amount  that will be
required  to pay the  probable  liability  of such  Person  on its debts as they
become  absolute  and  matured,  (c) such  Person  is able to  realize  upon its
properties  and  assets  and pay its  debts and  other  liabilities,  contingent
obligations  and  other  commitments  as they  mature  in the  normal  course of
business, (d) such Person does not intend to, and does not believe that it will,
incur debts beyond such Person's  ability to pay as such debts  mature,  and (e)
such Person is not engaged in  business  or a  transaction,  and is not about to
engage in business or a  transaction,  for which such  Person's  properties  and
assets  would   constitute   unreasonably   small   capital   after  giving  due
consideration  to the prevailing  practices in the industry in which such Person
is engaged. In computing the amount of contingent liabilities at any time, it is
intended that such  liabilities will be computed at the amount that, in light of
all the facts and  circumstances  existing at such time,  represents  the amount
that reasonably can be expected to become an actual or matured liability.

             "Stock Pledge Agreement" means that certain Stock Pledge Agreement,
in form and substance  satisfactory to Foothill,  executed and delivered by each
Borrower  relative to the shares of stock (if any) that it owns with  respect to
each of its direct Subsidiaries.

             "Subsidiary" of a Person means a corporation,  partnership, limited
liability  company,  or other entity in which that Person directly or indirectly
owns or  controls  the  shares  of  stock or other  ownership  interests  having
ordinary  voting power to elect a majority of the board of directors (or appoint
other comparable managers) of such corporation,  partnership,  limited liability
company, or other entity.

             "Suretyship  Agreement"  means an agreement,  in form and substance
satisfactory  to  Foothill,  dated as of even date  herewith and entered into by
each Borrower for the benefit of Foothill.

             "Technologies"  has the meaning  set forth in the  preamble to this
Agreement.

             "Term Loan" has the meaning set forth in Section 2.3.

             "Trademark   Security   Agreement"  means  that  certain  Trademark
Security Agreement, in form and substance satisfactory to Foothill, executed and
delivered by each Borrower.

             "Voidable Transfer" has the meaning set forth in Section 15.8.

             "Warrants"  means those  certain  common  stock  purchase  warrants
issued  and  delivered  to  Foothill  by  LaserSight,   in  form  and  substance
satisfactory to Foothill, on the Closing Date for the purchase of 500,000 shares
of LaserSight's common stock, $0.001 par value, having the powers,  preferences,
and rights, and the  qualifications,  limitations,  or restrictions set forth in
LaserSight's Governing Documents.

        1.2 Accounting  Terms.  All accounting  terms not  specifically  defined
herein shall be construed in accordance  with GAAP.  When used herein,  the term
"financial  statements" shall include the notes and schedules thereto.  Whenever
the term  "Borrower"  is used in respect of a  financial  covenant  or a related
definition,  it shall be  understood to mean  Borrower on a  consolidated  basis
unless the context clearly requires otherwise.

        1.3 Code.  Any terms used in this Agreement that are defined in the Code
shall be construed and defined as set forth in the Code unless otherwise defined
herein.

        1.4 Construction.  Unless the context of this Agreement clearly requires
otherwise,  references  to the plural  include the  singular,  references to the
singular include the plural, the term "including" is not limiting,  and the term
"or" has, except where otherwise indicated, the inclusive meaning represented by
the phrase "and/or." The words "hereof,"  "herein,"  "hereby,"  "hereunder," and
similar terms in this  Agreement  refer to this  Agreement as a whole and not to
any particular provision of this Agreement. An Event of Default shall "continue"
or be  "continuing"  until such Event of Default  has been  waived in writing by
Foothill. Section,  subsection,  clause, schedule, and exhibit references are to
this Agreement unless otherwise specified. Any reference in this Agreement or in
the Loan Documents to this Agreement or any of the Loan Documents  shall include
all  alterations,  amendments,  changes,  extensions,  modifications,  renewals,
replacements,   substitutions,   and  supplements,   thereto  and  thereof,   as
applicable.

        1.5 Schedules and Exhibits.  All of the schedules and exhibits  attached
to this Agreement shall be deemed incorporated herein by reference.

     2. LOAN AND TERMS OF PAYMENT

        2.1 Revolving Advances.

             (a) Subject to the terms and conditions of this Agreement, Foothill
agrees to make advances ("Advances") to Borrower in an amount outstanding not to
exceed at any one time the lesser of (i) the Maximum  Revolving  Amount, or (ii)
the Borrowing Base. For purposes of this Agreement,  "Borrowing Base", as of any
date of determination, shall mean the result of:

                 (y) 80% of Eligible Contract Receivables, minus

                 (z) the aggregate  amount of reserves,  if any,  established by
Foothill under Section 2.1(b).

             (b) Anything   to   the   contrary   in   Section    2.1(a)   above
notwithstanding,  Foothill  may create  reserves  against or reduce its  advance
rates based upon Eligible  Contract  Receivables  without  declaring an Event of
Default if it determines that there has occurred a Material Adverse Change.

             (c) Foothill shall have no obligation to make Advances hereunder to
the extent they would cause the  outstanding  Obligations  (other than under the
Term Loan) to exceed the Maximum Revolving Amount.

             (d) Amounts  borrowed  pursuant  to this  Section 2.1 may be repaid
and,  subject to the terms and conditions of this  Agreement,  reborrowed at any
time during the term of this Agreement.

        2.2 [Intentionally Omitted]

        2.3 Term Loan. Foothill has agreed to make a term loan (the "Term Loan")
to Borrower in the original principal amount of $4,000,000.  The Term Loan shall
be repaid in 3 installments of principal in the following amounts:

                 Month                             Installment Amount
                 -----                             ------------------
             14 through 15                             $1,333,000
                  16                                   $1,334,000

Each such  installment  shall be due and  payable on the first day of each month
commencing on the first day of the fourteenth  month  following the Closing Date
and continuing on the first day of each succeeding month until and including the
date on  which  the  unpaid  balance  of the  Term  Loan is  paid in  full.  The
outstanding principal balance and all accrued and unpaid interest under the Term
Loan shall be due and payable upon the termination of this Agreement, whether by
its terms, by prepayment,  by acceleration,  or otherwise.  The unpaid principal
balance of the Term Loan may be prepaid in whole or in part  without  penalty or
premium at any time during the term of this Agreement upon 30 days prior written
notice by Borrower to Foothill,  all such  prepaid  amounts to be applied to the
installments  due on the Term Loan in the inverse order of their  maturity.  All
amounts outstanding under the Term Loan shall constitute Obligations.

        2.4 [Intentionally Omitted].

        2.5  Overadvances.  If,  at any time or for any  reason,  the  amount of
Obligations owed by Borrower to Foothill pursuant to Section 2.1 is greater than
either  the  Dollar  or  percentage  limitations  set forth in  Section  2.1 (an
"Overadvance"),  Borrower immediately shall pay to Foothill, in cash, the amount
of such  excess  to be used by  Foothill  to repay  Advances  outstanding  under
Section 2.1.

        2.6 Interest: Rates, Payments, and Calculations.

             (a) Interest Rate.  Except as provided in clause (b) below, (i) all
Obligations  (except for the Term Loan) shall bear  interest at a per annum rate
of 1.50 percentage points above the Reference Rate, and (ii) the Term Loan shall
bear interest at a per annum rate of 12.50 percentage points.

             (b) Default Rate.  Upon the occurrence and during the  continuation
of an Event of  Default,  (i) all  Obligations  (except for the Term Loan) shall
bear  interest  at a per annum rate equal to 4.50  percentage  points  above the
Reference  Rate,  and (ii) the Term Loan shall bear interest at a per annum rate
equal to 15.50 percentage points.

             (c) [Intentionally Omitted].

             (d) Payments.  Interest payable hereunder shall be due and payable,
in arrears, on the first day of each month during the term hereof. Each Borrower
hereby  authorizes  Foothill,  at its  option,  without  prior  notice  to  such
Borrower, to charge such interest, all Foothill Expenses (as and when incurred),
the fees and  charges  provided  for in  Section  2.11 (as and when  accrued  or
incurred), and all installments or other payments due under the Term Loan or any
Loan Document to Borrower's Loan Account,  which amounts thereafter shall accrue
interest at the rate then  applicable  to Advances  hereunder.  Any interest not
paid when due shall be compounded and shall  thereafter  accrue  interest at the
rate then applicable to Advances hereunder.

             (e)  Computation.  The  Reference  Rate  as of  the  date  of  this
Agreement  is 8.5% per annum.  In the event the  Reference  Rate is changed from
time to time hereafter,  the applicable rate of interest hereunder automatically
and  immediately  shall be  increased  or  decreased  by an amount equal to such
change in the Reference  Rate. All interest and fees  chargeable  under the Loan
Documents shall be computed on the basis of a 360 day year for the actual number
of days elapsed.

             (f) Intent to Limit  Charges to Maximum  Lawful  Rate.  In no event
shall the interest rate or rates payable  under this  Agreement,  plus any other
amounts paid in connection  herewith,  exceed the highest rate permissible under
any law that a court of competent  jurisdiction shall, in a final determination,
deem  applicable.  Each Borrower and Foothill,  in executing and delivering this
Agreement, intend legally to agree upon the rate or rates of interest and manner
of payment stated within it; provided,  however, that, anything contained herein
to the contrary notwithstanding,  if said rate or rates of interest or manner of
payment exceeds the maximum  allowable under applicable law, then, ipso facto as
of the date of this  Agreement,  Borrower  is and shall be  liable  only for the
payment of such maximum as allowed by law, and payment received from Borrower in
excess of such legal maximum,  whenever received, shall be applied to reduce the
principal balance of the Obligations to the extent of such excess.

        2.7  Collection of Accounts.  Each Borrower  shall at all times maintain
its respective  lockboxes (the "Lockboxes")  and,  immediately after the Closing
Date,  shall instruct all Account Debtors with respect to the Accounts,  General
Intangibles, and Negotiable Collateral of such Borrower to remit all Collections
in respect thereof to such Lockboxes.  Each Borrower,  Foothill, and the Lockbox
Banks shall enter into the Lockbox  Agreements,  which among other  things shall
provide for the opening of a Lockbox Account for the deposit of Collections at a
Lockbox  Bank.  Each  Borrower  agrees that all  Collections  and other  amounts
received  by  such  Borrower  from  any  Account  Debtor  or  any  other  source
immediately upon receipt shall be deposited into a Lockbox  Account.  No Lockbox
Agreement or  arrangement  contemplated  thereby shall be modified by a Borrower
without the prior written consent of Foothill. Upon the terms and subject to the
conditions  set forth in the Lockbox  Agreements,  all amounts  received in each
Lockbox  Account shall be wired each Business Day into an account (the "Foothill
Account") maintained by Foothill at a depositary selected by Foothill.

        2.8 Crediting Payments;  Application of Collections.  The receipt of any
Collections by Foothill (whether from transfers to Foothill by the Lockbox Banks
pursuant to the Lockbox  Agreements or otherwise)  immediately  shall be applied
provisionally to reduce the Obligations outstanding under Section 2.1, but shall
not be  considered a payment on account  unless such  Collection  item is a wire
transfer of  immediately  available  federal  funds and is made to the  Foothill
Account or unless and until such  Collection  item is honored when presented for
payment.  If,  after  applying  Collections  to  Obligations  then due, a credit
remains,  and if no Event of Default has  occurred and is  continuing,  Foothill
shall  transfer  such credit,  in  immediately  available  funds,  to Borrower's
Designated Account.  From and after the Closing Date, Foothill shall be entitled
to charge Borrower for 2 Business Days of `clearance' or `float' at the rate set
forth  in  Section  2.6(a)(i)  or  Section  2.6(b)(i),  as  applicable,  on  all
Collections  that are received by Foothill  (regardless of whether  forwarded by
the  Lockbox  Banks to  Foothill,  whether  provisionally  applied to reduce the
Obligations under Section 2.1, or otherwise).  This  across-the-board 2 Business
Day clearance or float charge on all  Collections is acknowledged by the parties
to  constitute  an integral  aspect of the pricing of  Foothill's  financing  of
Borrower,  and shall  apply  irrespective  of the  characterization  of  whether
receipts are owned by a Borrower or  Foothill,  and whether or not there are any
outstanding  Advances,  the effect of such  clearance  or float charge being the
equivalent of charging 2 Business Days of interest on such  Collections.  Should
any  Collection  item not be honored when  presented for payment,  then Borrower
shall  be  deemed  not  to  have  made  such  payment,  and  interest  shall  be
recalculated   accordingly.   Anything   to  the   contrary   contained   herein
notwithstanding,  any Collection  item shall be deemed received by Foothill only
if it is received into the Foothill Account on a Business Day on or before 11:00
a.m.  California  time.  If any  Collection  item is received  into the Foothill
Account on a non-Business Day or after 11:00 a.m.  California time on a Business
Day,  it shall be deemed to have been  received by Foothill as of the opening of
business on the immediately following Business Day.

        2.9 Designated Account.  Foothill is authorized to make the Advances and
the Term Loan under this Agreement based upon  telephonic or other  instructions
received  from  anyone  purporting  to  be  an  Authorized  Person,  or  without
instructions  if pursuant to Section  2.6(d).  Borrower  agrees to establish and
maintain the Designated Account with the Designated Account Bank for the purpose
of  receiving  the  proceeds of the  Advances  requested by Borrower and made by
Foothill  hereunder.  Unless  otherwise  agreed by Foothill  and  Borrower,  any
Advance  requested by Borrower and made by Foothill  hereunder  shall be made to
the Designated Account.

        2.10  Maintenance of Loan Account;  Statements of Obligations.  Foothill
shall  maintain  an  account  on its books in the name of  Borrower  (the  "Loan
Account") on which  Borrower will be charged with all Advances and the Term Loan
made by  Foothill  to Borrower or for  Borrower's  account,  including,  accrued
interest,  Foothill Expenses,  and any other payment Obligations of Borrower. In
accordance with Section 2.8, the Loan Account will be credited with all payments
received by Foothill  from  Borrower or for  Borrower's  account,  including all
amounts received in the Foothill  Account from any Lockbox Bank.  Foothill shall
render statements  regarding the Loan Account to Borrower,  including principal,
interest,  fees,  and  including  an  itemization  of all charges  and  expenses
constituting  Foothill Expenses owing, and such statements shall be conclusively
presumed to be correct and accurate and  constitute  an account  stated  between
Borrower and Foothill unless,  within 30 days after receipt thereof by Borrower,
Borrower  shall deliver to Foothill  written  objection  thereto  describing the
error or errors contained in any such statements.

        2.11 Fees. Borrower shall pay to Foothill the following fees:

             (a) Origination Fee. Unless previously paid to Foothill pursuant to
the terms of the Commitment  Letter,  on the Closing Date, an origination fee of
$150,000;

             (b) Financial  Examination and Appraisal Fees. Foothill's customary
fee of $650 per day per examiner, plus out-of-pocket expenses for each financial
analysis  and  examination  (i.e.,  audits) of Borrower  performed  by personnel
employed by Foothill;  Foothill's  customary appraisal fee of $1,500 per day per
appraiser,  plus  out-of-pocket  expenses for each  appraisal of the  Collateral
performed by  personnel  employed by  Foothill;  and the actual  charges paid or
incurred by  Foothill  if it elects to employ the  services of one or more third
Persons to perform such financial  analyses and examinations  (i.e.,  audits) of
Borrower or to appraise the Collateral;  provided, however, that, in the absence
of an Event of Default,  such financial  examination  and appraisal fees, in the
aggregate, shall not exceed $15,000 per year; and

             (c)  Servicing  Fee. On the first day of each month during the term
of this Agreement,  commencing on May 1, 1997 and continuing  thereafter so long
as any  Obligations  are  outstanding,  a  servicing  fee in an amount  equal to
$5,000.

     3.      CONDITIONS; TERM OF AGREEMENT

        3.1 Conditions  Precedent to the  Initial Advance and the Term Loan. The
obligation  of Foothill to make the initial  Advance or the Term Loan is subject
to the fulfillment,  to the satisfaction of Foothill and its counsel, of each of
the following conditions on or before the Closing Date:

             (a) the Closing Date shall occur on or before March 31, 1997;

             (b) Foothill shall have received searches  reflecting the filing of
its financing statements and fixture filings;

             (c) Foothill  shall have received each of the following  documents,
duly executed, and each such document shall be in full force and effect:

                 1. the Lockbox Agreements;

                 2. the Disbursement Letter;

                 3.  the  Pay-Off  Letter,  together  with  any UCC  termination
                 statements and other  documentation  evidencing the termination
                 by Existing  Lender of its Liens in and to the  properties  and
                 assets of Borrower;

                 4. the Guaranty;

                 5. the Stock Pledge Agreement;

                 6. the Copyright Security Agreements;

                 7. the Patent Security Agreements;

                 8. the Trademark Security Agreements;

                 9. the Warrants;

                 10. the Suretyship Agreement; and

                 11. the IBM Consent.

             (d)  Foothill   shall  have  received  the  original   certificates
representing  or evidencing  all of the Pledged  Shares (as defined in the Stock
Pledge Agreement) of each Issuer (as defined in the Stock Pledge Agreement) that
is not a  Non-Material  Subsidiary,  together  with stock  powers or  equivalent
assignments with respect thereto duly endorsed in blank;

             (e) Foothill  shall have received a certificate  from the Secretary
or other  officer  acceptable  to Foothill  of each  Borrower  and of  Guarantor
attesting  to the  resolutions  of  such  Borrower's  or  Guarantor's  Board  of
Directors authorizing its execution, delivery, and performance of this Agreement
and the other Loan  Documents to which such Borrower or Guarantor is a party and
authorizing specific officers of such Borrower or Guarantor to execute the same;

             (f) Foothill shall have received  copies of each  Borrower's and of
Guarantor's  Governing Documents,  as amended,  modified, or supplemented to the
Closing Date, certified by the Secretary or other officer acceptable to Foothill
of such Borrower or Guarantor, as applicable;

             (g)  Foothill  shall have  received a  certificate  of status  with
respect to each  Borrower  and  Guarantor,  dated  within 10 days of the Closing
Date,  such  certificate  to  be  issued  by  the  appropriate  officer  of  the
jurisdiction of organization of such Borrower or Guarantor, as applicable, which
certificate shall indicate that such Borrower or Guarantor, as applicable, is in
good standing in such jurisdiction;

             (h)  Foothill  shall  have  received  certificates  of status  with
respect to each Borrower and Guarantor, each dated within 15 days of the Closing
Date,  such  certificates  to be  issued  by  the  appropriate  officer  of  the
jurisdictions  in which its  failure  to be duly  qualified  or  licensed  would
constitute a Material  Adverse Change,  which  certificates  shall indicate that
such  Borrower  or  Guarantor,  as  applicable,  is in  good  standing  in  such
jurisdictions;

             (i)  Foothill  shall have  received  a  certificate  of  insurance,
together with the  endorsements  thereto,  as are required by Section 6.10,  the
form and substance of which shall be satisfactory to Foothill and its counsel;

             (j) Foothill  shall have received a certificate  from the Secretary
or other officer acceptable to Foothill of Guarantor certifying to Foothill that
Guarantor does not own or hold any patents,  trademarks,  or copyrights,  or any
applications or licenses in respect of any of the foregoing.

             (k) [intentionally omitted];

             (l) Foothill  shall have received an opinion of Borrower's  counsel
in form and substance satisfactory to Foothill in its sole discretion;

             (m)  Foothill  shall have  received  satisfactory  evidence  (which
evidence may be in the form of a certificate of the Chief  Financial  Officer of
Borrower to such effect)  that all tax returns  required to be filed by Borrower
have been timely filed and all taxes upon  Borrower or its  properties,  assets,
income,  and franchises  (including  real property taxes and payroll taxes) have
been paid, except such taxes that are the subject of a Permitted Protest;

             (n) Foothill  shall have  received  the  original of each  Existing
Purchase Agreement;

             (o) Foothill shall have received  LaserSight's 1996 fiscal year-end
consolidated,  audited financial statements,  the contents of which shall not be
materially  different  from  the  draft  version  of such  financial  statements
previously delivered to Foothill;

             (p) Foothill  shall have  received a set of  projections  as to the
projected  financial  performance  of  Borrower  (after  giving  effect  to  the
transactions  contemplated  hereby)  for a period  of 18  months  following  the
Closing Date, which projections shall be (i) in form and substance  satisfactory
to Lender,  and (ii)  certified  by the chief  financial  officer of Borrower as
being such  officer's  good faith best estimate of the financial  performance of
Borrower  during such period,  provided  that  Foothill  acknowledges  that such
projections  may be subject  to certain  variables  and  assumptions  beyond the
control of Borrower;

             (q) Foothill shall have received the results of reference checks on
key management  personnel of Borrower,  which results shall be  satisfactory  to
Foothill in is sole discretion;

             (r) Foothill shall have received a copy the Intercompany Agreement,
together with a certificate of an appropriate officer of Technologies certifying
that the same is true, correct,  and complete and that such agreement is in full
force and effect;

             (s)  Foothill  shall  have  received  copies  of  the  IBM  License
Agreement  and the IBM  Option  Agreement,  together  with a  certificate  of an
appropriate  officer  of  LaserSight  certifying  that each of the same is true,
correct,  and complete and that each such agreement is in full force and effect;
and

             (t) all other  documents and legal  matters in connection  with the
transactions contemplated by this Agreement shall have been delivered, executed,
or recorded and shall be in form and substance  satisfactory to Foothill and its
counsel.

        3.2  Conditions  Precedent  to all  Advances  and  the  Term  Loan.  The
following  shall be  conditions  precedent  to all  Advances  and the Term  Loan
hereunder:

             (a) the representations and warranties  contained in this Agreement
and the other Loan Documents shall be true and correct in all material  respects
on and as of the date of such  extension of credit,  as though made on and as of
such date (except to the extent that such  representations and warranties relate
solely to an earlier date);

             (b) no  Default  or Event of Default  shall  have  occurred  and be
continuing on the date of such extension of credit, nor shall either result from
the making thereof; and

             (c) no injunction,  writ,  restraining order, or other order of any
nature prohibiting,  directly or indirectly,  the extending of such credit shall
have been  issued  and  remain in force by any  governmental  authority  against
Borrower, Foothill, or any of their Affiliates.

        3.3 Conditions  Subsequent.  As conditions subsequent to initial closing
hereunder,  Borrower  shall perform or cause to be performed the following  (the
failure by Borrower to so perform or cause to be performed constituting an Event
of Default):

             (a) within 30 days of the Closing  Date,  deliver to  Foothill  the
certified  copies of the policies of insurance,  together with the  endorsements
thereto,  as are required by Section 6.10, the form and substance of which shall
be satisfactory to Foothill and its counsel;

             (b) within 45 days of the Closing  Date,  deliver to Foothill  such
fully executed Collateral Access Agreements from lessors, warehousemen, bailees,
and other third persons as Foothill reasonably may require;

             (c)  (i)  on  or  before   the  date  on  which  the   transactions
contemplated by the IBM Option Agreement are consummated,  Foothill and Borrower
shall have amended the schedules to the Patent Security Agreement, as necessary,
to reflect any and all  additional  Patent  Collateral (as defined in the Patent
Security  Agreement)  acquired  by Borrower  in  connection  with the IBM Option
Agreement,  and (ii)  within  10 days of the date on which the  Patent  Security
Agreement has been amended  pursuant to clause (i) above,  such amendment  shall
have been recorded with the U.S. Patent and Trademark Office;

             (d) within 120 days of the  Closing  Date,  Foothill  and  Borrower
shall have  negotiated  in good faith to  establish  and shall have  established
mutually  agreeable  criteria  with  respect to (i) the timing and amount of the
down  payment  required of Account  Debtors in  connection  with the purchase of
goods from Borrower,  and (ii) the  underwriting  requirements  to be applied by
Borrower with respect to new Account Debtors;

             (e)  within  45  days  of the  Closing  Date,  in the  case of each
Borrower Letter of Credit  outstanding on the Closing Date, or within 45 days of
the date on which a  Borrower  Letter of Credit is  issued,  in the case of each
Borrower Letter of Credit issued after the Closing Date, (i) deliver to Foothill
the  original of such  Borrower  Letter of Credit,  or (ii) cause each Person in
possession  of a  Borrower  Letter  of  Credit  (which  Person  shall  not be an
Affiliate  of any Borrower or the issuer of such  Borrower  Letter of Credit) to
enter into a bailment agreement, in form and substance satisfactory to Foothill,
pursuant to which  agreement  such Person shall  acknowledge  that it is holding
such Borrower Letter of Credit as a bailee for Foothill; and

             (f)  within  30 days  of the  Closing  Date,  Foothill  shall  have
received the original certificates representing or evidencing all of the Pledged
Shares (as defined in the Stock Pledge  Agreement) of each Issuer (as defined in
the Stock Pledge  Agreement)  that is a Non-Material  Subsidiary,  together with
stock powers or  equivalent  assignments  with respect  thereto duly endorsed in
blank.

        3.4 Term. This Agreement  shall become  effective upon the execution and
delivery  hereof by each Borrower and Foothill and shall  continue in full force
and  effect  for a term  ending on the date (the  "Maturity  Date")  that is the
earlier of (a) 18 months  from the Closing  Date,  and (b) the date on which the
sale   of   Technologies   by   LaserSight   is   consummated.   The   foregoing
notwithstanding,  Foothill  shall have the right to  terminate  its  obligations
under this  Agreement  immediately  and without  notice upon the  occurrence and
during the continuation of an Event of Default.

        3.5 Effect of Termination. On the date of termination of this Agreement,
all  Obligations  immediately  shall  become due and payable  without  notice or
demand.  No termination of this Agreement,  however,  shall relieve or discharge
Borrower  of  Borrower's  duties,   Obligations,  or  covenants  hereunder,  and
Foothill's  continuing  security  interests  in the  Collateral  shall remain in
effect  until  all  Obligations  have  been  fully and  finally  discharged  and
Foothill's obligation to provide additional credit hereunder is terminated.

        3.6 Early  Termination  by Borrower.  The provisions of Section 3.4 that
allow  termination  of this  Agreement  by Borrower  only on the  Maturity  Date
notwithstanding, Borrower has the option, at any time upon 30 days prior written
notice to Foothill,  to terminate this Agreement by paying to Foothill, in cash,
the  Obligations,  in full,  together  with a premium  (the  "Early  Termination
Premium")  equal to (a)  $10,000  times the  number of  months  (either  full or
partial, and including the month in which the termination occurs) remaining from
the date of the  termination to the Maturity  Date, if termination  occurs on or
prior to the first anniversary of the Closing Date; provided,  however,  that in
the  event  that  the  Agreement  is  terminated  as a  result  of the  sale  of
Technologies  during such time, the Early  Termination  Premium instead shall be
$50,000,  irrespective of the number of such months  remaining,  and (b) -0-, if
the termination occurs after the first anniversary of the Closing Date.

        3.7  Termination  Upon Event of  Default.  If Foothill  terminates  this
Agreement  upon  the  occurrence  of  an  Event  of  Default,  in  view  of  the
impracticability  and extreme  difficulty of ascertaining  actual damages and by
mutual  agreement of the parties as to a reasonable  calculation  of  Foothill's
lost  profits  as a result  thereof,  Borrower  shall pay to  Foothill  upon the
effective  date of such  termination,  a premium in an amount equal to the Early
Termination  Premium.  The Early Termination Premium shall be presumed to be the
amount of damages  sustained by Foothill as the result of the early  termination
and Borrower  agrees that it is  reasonable  under the  circumstances  currently
existing.  The Early Termination  Premium provided for in this Section 3.7 shall
be deemed included in the Obligations.

     4. CREATION OF SECURITY INTEREST

        4.1 Grant of Security Interest.  Each Borrower hereby grants to Foothill
a continuing  security interest in all currently existing and hereafter acquired
or  arising  Collateral  in  order to  secure  prompt  repayment  of any and all
Obligations  and in order to secure prompt  performance by such Borrower of each
of its  covenants  and  duties  under the Loan  Documents.  Foothill's  security
interests in the Collateral  shall attach to all Collateral  without further act
on the part of Foothill or such Borrower.  Anything  contained in this Agreement
or any other Loan Document to the contrary notwithstanding, except for Permitted
Dispositions,  Borrower has no authority,  express or implied, to dispose of any
item or portion of the Collateral.

        4.2 Negotiable Collateral.  In the event that any Collateral,  including
proceeds,  is  evidenced  by or consists  of  Negotiable  Collateral,  Borrower,
immediately  upon the request of Foothill,  shall  endorse and deliver  physical
possession of such Negotiable Collateral to Foothill.

        4.3  Collection  of  Accounts,   General  Intangibles,   and  Negotiable
Collateral.  At any  time,  Foothill  or  Foothill's  designee  may  (a)  notify
customers or Account Debtors of Borrower that the Accounts, General Intangibles,
or Negotiable  Collateral  have been assigned to Foothill or that Foothill has a
security interest therein,  and (b) collect the Accounts,  General  Intangibles,
and Negotiable  Collateral directly and charge the collection costs and expenses
to the Loan  Account.  Each  Borrower  agrees  that it will  hold in  trust  for
Foothill,   as  Foothill's  trustee,   any  Collections  that  it  receives  and
immediately  will deliver said Collections to Foothill in their original form as
received by such Borrower.

        4.4 Delivery of Additional  Documentation Required. At any time upon the
request of Foothill,  each  Borrower  shall  execute and deliver to Foothill all
financing  statements,   continuation  financing  statements,  fixture  filings,
security  agreements,  pledges,  assignments,  endorsements  of  certificates of
title,  applications  for title,  affidavits,  reports,  notices,  schedules  of
accounts, letters of authority, and all other documents that Foothill reasonably
may request, in form satisfactory to Foothill, to perfect and continue perfected
Foothill's  security  interests  in  the  Collateral,  and  in  order  to  fully
consummate all of the transactions  contemplated  hereby and under the other the
Loan Documents.

        4.5  Power  of  Attorney.   Each  Borrower  hereby   irrevocably  makes,
constitutes,  and appoints Foothill (and any of Foothill's officers,  employees,
or agents  designated by Foothill) as such Borrower's true and lawful  attorney,
with power to (a) if such  Borrower  refuses to, or fails  timely to execute and
deliver any of the  documents  described in Section  4.4,  sign the name of such
Borrower on any of the documents  described in Section 4.4, (b) at any time that
an Event of Default has  occurred  and is  continuing  or Foothill  deems itself
insecure, sign such Borrower's name on any invoice or bill of lading relating to
any Account or contract  receivable,  drafts against Account Debtors,  schedules
and assignments of Accounts or contract  receivables,  verifications of Accounts
or contract  receivables,  and notices to Account Debtors, (c) send requests for
verification  of Accounts or contract  receivables,  (d) endorse such Borrower's
name on any Collection item that may come into Foothill's possession, (e) at any
time that an Event of Default has occurred and is continuing  or Foothill  deems
itself  insecure,  notify the post office  authorities to change the address for
delivery  of such  Borrower's  mail to an address  designated  by  Foothill,  to
receive and open all mail  addressed  to such  Borrower,  and to retain all mail
relating to the Collateral  and forward all other mail to such Borrower,  (f) at
any time that an Event of Default has  occurred  and is  continuing  or Foothill
deems itself insecure, make, settle, and adjust all claims under such Borrower's
policies of insurance and make all  determinations and decisions with respect to
such  policies  of  insurance,  and (g) at any time that an Event of Default has
occurred and is continuing or Foothill deems itself insecure,  settle and adjust
disputes and claims  respecting  the Accounts or contract  receivables  directly
with Account Debtors,  for amounts and upon terms that Foothill determines to be
reasonable,  and Foothill may cause to be executed and  delivered  any documents
and releases  that  Foothill  determines to be  necessary.  The  appointment  of
Foothill as Borrower's attorney, and each and every one of Foothill's rights and
powers,  being  coupled  with  an  interest,  is  irrevocable  until  all of the
Obligations  have been fully and finally  repaid and  performed  and  Foothill's
obligation to extend credit hereunder is terminated.

        4.6 Right to Inspect. Foothill (through any of its officers,  employees,
or  agents)  shall  have the  right,  from  time to time  hereafter  to  inspect
Borrower's  Books and to check,  test,  and appraise the  Collateral in order to
verify Borrower's financial condition or the amount,  quality,  value, condition
of, or any other matter relating to, the Collateral.

     5. REPRESENTATIONS AND WARRANTIES.

        In order to induce Foothill to enter into this Agreement, Borrower makes
the following  representations and warranties which shall be true, correct,  and
complete in all respects as of the date hereof, and shall be true, correct,  and
complete in all  respects as of the Closing  Date,  and at and as of the date of
the making of each Advance or Term Loan made  thereafter,  as though made on and
as of the date of such  Advance  or Term Loan,  (except to the extent  that such
representations  and  warranties  relate  solely  to an  earlier  date) and such
representations  and warranties shall survive the execution and delivery of this
Agreement:

        5.1 No  Encumbrances.  Borrower has good and  indefeasible  title to the
Collateral, free and clear of Liens except for Permitted Liens.

        5.2 Eligible Contract Receivables. The Eligible Contract Receivables are
bona fide existing  obligations created by the sale and delivery of Inventory or
the  rendition  of  services  to  Account  Debtors  in the  ordinary  course  of
Technologies'  business,  unconditionally owed to Technologies without defenses,
disputes,  offsets,  counterclaims,  or rights of  return or  cancellation.  The
property giving rise to such Eligible Contract Receivables has been delivered to
the Account Debtor,  or to the Account Debtor's agent for immediate  shipment to
and  unconditional  acceptance  by the  Account  Debtor.  Technologies  has  not
received  notice of actual  or  imminent  bankruptcy,  insolvency,  or  material
impairment  of the  financial  condition  of any Account  Debtor  regarding  any
Eligible Contract Receivable.

        5.3 Purchase  Agreements.  Each Existing  Purchase  Agreement is in full
force and  effect and  constitutes  the only  original  agreement  executed  and
delivered by  Technologies  and the Account Debtor party thereto (other than any
original agreement given to such Account Debtor at the time of execution).

        5.4  Equipment.  All of  the  Equipment  is  used  or  held  for  use in
Borrower's business and is fit for such purposes.

        5.5 Location of Inventory and Equipment. The Inventory and Equipment are
located only at the locations identified on Schedule 6.12 or otherwise permitted
by  Sections  6.12 and 7.10.  Except for  Inventory,  in an amount not to exceed
$300,000  in the  aggregate,  that is  located  at one or more of the  locations
identified on Schedule 6.12 as being a warehouse and as to which Borrower timely
has delivered to Foothill a Collateral  Access Agreement from such bailee,  none
of the Inventory or Equipment is stored with a bailee, warehouseman,  or similar
party (without Foothill's prior written consent).

        5.6  Inventory  Records.  Borrower  keeps  correct and accurate  records
itemizing and describing the kind, type, quality, and quantity of the Inventory,
and Borrower's cost therefor.

        5.7 Location of Chief  Executive  Offices;  FEINs.  The chief  executive
office of each  Borrower is located at the address  indicated in the preamble to
this  Agreement.   LaserSight's  FEIN  is  65-0273162,   Technologies'  FEIN  is
59-3250400, MEC's FEIN is 52-1618385, LSI's FEIN is 22-3434291, Centers' FEIN is
63-0138090, and MRF's FEIN is 43-1561764.

        5.8 Due Organization and Qualification; Subsidiaries.

        (a) Each  Borrower is duly  organized  and existing and in good standing
under  the laws of the  jurisdiction  of its  incorporation  and  qualified  and
licensed to do business in, and in good standing in, any state where the failure
to be so licensed or qualified  reasonably  could be expected to have a Material
Adverse Change.

        (b) The authorized capital stock of LaserSight consists of the number of
shares of each class of common and  preferred  stock set forth on Schedule  5.8,
which schedule also sets forth the number of such shares  outstanding or held in
its treasury as of the date hereof. No shares of such capital stock are entitled
to preemptive  rights by reason of any provision of the General  Corporation Law
of the State of Delaware or the certificate of incorporation  of LaserSight.  To
the best of our knowledge,  except as disclosed in LaserSight's Annual Report on
Form 10-K for the year-ended  December 31, 1996 or as described on Schedule 5.8,
there are no  outstanding  options,  warrants,  scrip,  rights to subscribe  to,
calls, or commitments of any character  whatsoever relating to, or securities or
rights  convertible  into,  shares  of  any  capital  stock  of  LaserSight,  or
contracts,  commitments,  understandings, or arrangements by which LaserSight is
or may become bound to issue additional shares of its capital stock.

        (c) Set  forth  on  Schedule  5.8 is a  complete  and  accurate  list of
LaserSight's direct and indirect Subsidiaries,  showing: (i) the jurisdiction of
their  incorporation;  (ii) the  number of shares  of each  class of common  and
preferred stock authorized for each of such  Subsidiaries;  and (iii) the number
and the percentage of the  outstanding  shares of each such class owned directly
or indirectly by LaserSight.  All of the outstanding  capital stock of each such
Subsidiary has been validly issued and is fully paid and non-assessable.

        (d)  Except as set  forth on  Schedule  5.8,  no  capital  stock (or any
securities,  instruments,  warrants,  options,  purchase  rights,  conversion or
exchange rights, calls,  commitments or claims of any character convertible into
or  exercisable  for  capital  stock) of any direct or  indirect  Subsidiary  of
LaserSight  is subject to the  issuance of any  security,  instrument,  warrant,
option,  purchase right, conversion or exchange right, call, commitment or claim
of any right, title, or interest therein or thereto.

        (e)  No  direct  or  indirect  Subsidiary  of  LaserSight,   other  than
Non-Material Subsidiaries,  (i) owns any property or assets with a book value in
excess of $50,000,  (ii) currently engages in any material business activity, or
(iii) intends in the future to engage in any material business activity.

        5.9 Due Authorization; No Conflict.

        (a) The execution,  delivery,  and  performance by each Borrower of this
Agreement  and the  Loan  Documents  to  which  it is a  party  have  been  duly
authorized by all necessary corporate action.

        (b) The execution,  delivery,  and  performance by each Borrower of this
Agreement and the Loan  Documents to which it is a party do not and will not (i)
violate any provision of federal,  state, or local law or regulation  (including
Regulations  G, T, U, and X of the Federal  Reserve  Board)  applicable  to such
Borrower,  the Governing Documents of such Borrower, or any order,  judgment, or
decree of any court or other  Governmental  Authority  binding on such Borrower,
(ii) conflict  with,  result in a breach of, or  constitute  (with due notice or
lapse of time or both) a default  under any material  contractual  obligation or
material  lease of such  Borrower,  (iii)  result in or require the  creation or
imposition of any Lien of any nature whatsoever upon any properties or assets of
such  Borrower,  other than  Permitted  Liens,  or (iv)  require any approval of
stockholders  or any  approval  or  consent  of any  Person  under any  material
contractual obligation of such Borrower.

        (c) Other than the filing of appropriate financing  statements,  fixture
filings,  and  mortgages,  the  execution,  delivery,  and  performance  by each
Borrower of this  Agreement  and the Loan  Documents to which such Borrower is a
party do not and will not require any registration  with,  consent,  or approval
of, or notice to, or other action with or by, any federal,  state,  foreign,  or
other Governmental Authority or other Person.

        (d) This  Agreement and the Loan Documents to which Borrower is a party,
and all other  documents  contemplated  hereby and  thereby,  when  executed and
delivered by each Borrower will be the legally valid and binding  obligations of
such  Borrower,  enforceable  against  such  Borrower in  accordance  with their
respective terms,  except as enforcement may be limited by equitable  principles
or by  bankruptcy,  insolvency,  reorganization,  moratorium,  or  similar  laws
relating to or limiting creditors' rights generally.

        (e) The Liens  granted by Borrower to Foothill in and to its  properties
and assets  pursuant to this  Agreement and the other Loan Documents are validly
created, perfected, and first priority Liens, subject only to Permitted Liens.

        5.10  Litigation.  There are no  actions  or  proceedings  pending by or
against Borrower before any court or administrative agency and Borrower does not
have  knowledge or belief of any pending,  threatened,  or imminent  litigation,
governmental  investigations,  or claims,  complaints,  actions, or prosecutions
involving Borrower or any guarantor of the Obligations,  except for: (a) ongoing
collection matters in which Borrower is the plaintiff;  (b) matters specifically
disclosed in writing to Foothill  before the Closing  Date or on Schedule  5.10;
and (c) matters  arising  after the date hereof  that,  if decided  adversely to
Borrower, would not have a Material Adverse Change.

        5.11 No Material Adverse Change.  All financial  statements  relating to
Borrower  or any  guarantor  of the  Obligations  that  have been  delivered  by
Borrower to Foothill have been prepared in accordance with GAAP (except,  in the
case of unaudited  financial  statements,  for the lack of  footnotes  and being
subject to year-end audit  adjustments)  and fairly present  Borrower's (or such
guarantor's,  as  applicable)  financial  condition  as of the date  thereof and
Borrower's results of operations for the period then ended. There has not been a
Material  Adverse  Change  with  respect  to  Borrower  (or such  guarantor,  as
applicable)  since the date of the  latest  financial  statements  submitted  to
Foothill on or before the Closing Date.

        5.12  Solvency.  Borrower is  Solvent.  No transfer of property is being
made by Borrower and no obligation  is being  incurred by Borrower in connection
with the transactions contemplated by this Agreement or the other Loan Documents
with the intent to hinder,  delay, or defraud either present or future creditors
of Borrower.

        5.13 Employee Benefits.  None of Borrower,  any of its Subsidiaries,  or
any of their ERISA  Affiliates  maintains or  contributes  to any Benefit  Plan,
other than those listed on Schedule 5.13.  Borrower,  each of its  Subsidiaries,
and each ERISA Affiliate have satisfied the minimum  funding  standards of ERISA
and the IRC with  respect  to each  Benefit  Plan to which  it is  obligated  to
contribute.  No ERISA Event has occurred nor has any other event  occurred  that
may result in an ERISA  Event that  reasonably  could be expected to result in a
Material  Adverse  Change.  None of  Borrower  or its  Subsidiaries,  any  ERISA
Affiliate,  or any  fiduciary  of any Plan is subject to any direct or  indirect
liability  with  respect to any Plan under any  applicable  law,  treaty,  rule,
regulation,  or  agreement.  None of Borrower or its  Subsidiaries  or any ERISA
Affiliate is required to provide  security to any Plan under Section  401(a)(29)
of the IRC.

        5.14 Environmental  Condition.  None of Borrower's  properties or assets
has ever  been used by  Borrower  or, to the best of  Borrower's  knowledge,  by
previous owners or operators in the disposal of, or to produce,  store,  handle,
treat, release, or transport,  any Hazardous Materials except in compliance with
all Environmental Laws in all material respects.  None of Borrower's  properties
or assets has ever been  designated or identified in any manner  pursuant to any
environmental  protection  statute as a Hazardous  Materials disposal site, or a
candidate for closure pursuant to any environmental  protection statute. No Lien
arising under any environmental  protection statute has attached to any revenues
or to any real or personal property owned or operated by Borrower.  Borrower has
not received a summons,  citation,  notice,  or directive from the Environmental
Protection Agency or any other federal or state  governmental  agency concerning
any action or omission by Borrower  resulting  in the  releasing or disposing of
Hazardous Materials into the environment.
<PAGE>

     6. AFFIRMATIVE COVENANTS.

        Borrower  covenants  and agrees  that,  so long as any credit  hereunder
shall be  available  and until full and final  payment of the  Obligations,  and
unless Foothill shall otherwise consent in writing, Borrower shall do all of the
following:

        6.1  Accounting  System.  Maintain  a  standard  and  modern  system  of
accounting that enables Borrower to produce  financial  statements in accordance
with GAAP,  and  maintain  records  pertaining  to the  Collateral  that contain
information  as from time to time may be requested by  Foothill.  Borrower  also
shall keep a modern inventory reporting system that shows all additions,  sales,
claims, returns, and allowances with respect to the Inventory.

        6.2 Collateral Reporting.  Provide Foothill with the following documents
at the following times in form satisfactory to Foothill:  (a) on a weekly basis,
a sales journal,  collection  journal,  and credit  register since the last such
schedule  and a  calculation  of the  Borrowing  Base as of such date,  (b) on a
monthly  basis and,  in any  event,  by no later than the 15th day of each month
during the term of this Agreement,  (i) a detailed  calculation of the Borrowing
Base, and (ii) a detailed aging, by total, of the contract receivables, together
with a  reconciliation  to  the  detailed  calculation  of  the  Borrowing  Base
previously provided to Foothill, (c) on a monthly basis and, in any event, by no
later  than the 15th day of each  month  during  the term of this  Agreement,  a
summary aging, by vendor, of Borrower's accounts payable and any book overdraft,
(d) on a weekly  basis,  notice of all returns,  disputes,  or claims,  (e) upon
request,  copies  of  invoices  in  connection  with the  contract  receivables,
customer  statements,  credit  memos,  remittance  advices and reports,  deposit
slips,   shipping  and  delivery  documents  in  connection  with  the  contract
receivables  and for  Inventory  and  Equipment  acquired by Borrower,  purchase
orders and  invoices,  and (f) such other  reports as to the  Collateral  or the
financial condition of Borrower as Foothill may request from time to time.

        6.3 Financial Statements,  Reports,  Certificates.  Deliver to Foothill:
(a) as soon as available,  but in any event within 45 days after the end of each
month during each of LaserSight's fiscal years, a company prepared  consolidated
balance sheet, consolidated income statement, and consolidated statement of cash
flow covering  Lasersight's  consolidated  operations during such period; (b) as
soon as  available,  but in any event within 45 days after the end of each month
during each of  Technologies  fiscal years,  a company  prepared  balance sheet,
income statement,  and statement of cash flow covering Technologies'  operations
during such  period;  and (c) as soon as  available,  but in any event within 90
days after the end of each of LaserSight's fiscal years,  consolidated financial
statements  of  LaserSight  for each such fiscal  year,  audited by  independent
certified public  accountants  reasonably  acceptable to Foothill and certified,
without  any  qualifications,  by such  accountants  to have  been  prepared  in
accordance with GAAP, together with a certificate of such accountants  addressed
to Foothill stating that such accountants do not have knowledge of the existence
of any Default or Event of Default.  Such  audited  financial  statements  shall
include a consolidated  balance sheet,  consolidated  profit and loss statement,
and  consolidated  statement  of cash flow and, if prepared,  such  accountants'
letter to management. In addition to the financial statements referred to above,
LaserSight  agrees  to  deliver  annual  financial   statements  prepared  on  a
consolidating  basis  so  as to  present  each  Borrower  separately,  and  on a
consolidated basis.

        Together  with the  above,  Borrower  also  shall  deliver  to  Foothill
LaserSight's Form 10-Q Quarterly Reports, Form 10-K Annual Reports, and Form 8-K
Current  Reports,  and any other filings made by LaserSight  with the Securities
and Exchange  Commission,  if any,  within 2 Business  Days of the date that the
same are filed, or any other  information  that is provided by LaserSight to its
shareholders,  and any other report reasonably requested by Foothill relating to
the financial condition of LaserSight and its Subsidiaries.

        Each month, together with the consolidated financial statements provided
pursuant to Section 6.3(a),  LaserSight  shall deliver to Foothill a certificate
signed by its chief financial  officer to the effect that: (i) all  consolidated
financial  statements  delivered or caused to be delivered to Foothill hereunder
have been  prepared in accordance  with GAAP  (except,  in the case of unaudited
financial  statements,  for the lack of footnotes  and being subject to year-end
audit adjustments) and fairly present the financial  condition of LaserSight and
its Subsidiaries,  (ii) the representations and warranties of Borrower contained
in this  Agreement  and the other  Loan  Documents  are true and  correct in all
material respects on and as of the date of such  certificate,  as though made on
and as of  such  date  (except  to the  extent  that  such  representations  and
warranties relate solely to an earlier date),  (iii) for each month that also is
the  date on  which a  financial  covenant  in  Sections  7.20 and 7.21 is to be
tested, a Compliance  Certificate  demonstrating in reasonable detail compliance
at the end of such period with the applicable  financial  covenants contained in
Sections 7.20 and 7.21, and (iv) on the date of delivery of such  certificate to
Foothill there does not exist any condition or event that  constitutes a Default
or Event of Default  (or, in the case of clauses  (i),  (ii),  or (iii),  to the
extent of any  non-compliance,  describing such non-compliance as to which he or
she may have  knowledge  and what  action  Borrower  has taken,  is  taking,  or
proposes to take with respect thereto).

        LaserSight  shall have issued written  instructions  to its  independent
certified public  accountants  authorizing them to communicate with Foothill and
to release to Foothill whatever financial information  concerning LaserSight and
its  Subsidiaries  that Foothill may request in accordance  with such  certified
public  accountants'  policies and procedures.  Each Borrower hereby irrevocably
authorizes  and directs all  auditors,  accountants,  or other third  parties to
deliver to Foothill, at Borrower's expense,  copies of such Borrower's financial
statements,  papers related thereto,  and other accounting records of any nature
in their  possession,  and to disclose to Foothill any information they may have
regarding such Borrower's business affairs and financial conditions.

        6.4 Tax  Returns.  Deliver to  Foothill  copies of each of  LaserSight's
future federal income tax returns, and any amendments thereto, within 30 days of
the filing thereof with the Internal Revenue Service.

        6.5 Guarantor Reports.  Cause any guarantor of any of the Obligations to
deliver its annual financial  statements at the time when Borrower  provides its
audited  financial  statements to Foothill and copies of all federal  income tax
returns as soon as the same are available and in any event no later than 30 days
after the same are required to be filed by law.

        6.6 Returns.  Cause returns and allowances,  if any, as between Borrower
and its Account Debtors to be on the same basis and in accordance with the usual
customary practices of Borrower,  as they exist at the time of the execution and
delivery of this Agreement.  If, at a time when no Event of Default has occurred
and is  continuing,  any Account  Debtor  returns  any  Inventory  to  Borrower,
Borrower  promptly  shall  determine the reason for such return and, if Borrower
accepts  such  return,  issue  a  credit  memorandum  (with a copy to be sent to
Foothill) in the appropriate  amount to such Account Debtor.  If, at a time when
an Event of Default has occurred and is  continuing,  any Account Debtor returns
any Inventory to Borrower, Borrower promptly shall determine the reason for such
return  and, if  Foothill  consents  (which  consent  shall not be  unreasonably
withheld), issue a credit memorandum (with a copy to be sent to Foothill) in the
appropriate amount to such Account Debtor.

        6.7 [Intentionally Omitted]

        6.8  Maintenance of Equipment.  Maintain the Equipment in good operating
condition and repair  (ordinary wear and tear excepted),  and make all necessary
replacements thereto so that the value and operating efficiency thereof shall at
all times be maintained and preserved.  Other than those items of Equipment that
constitute  fixtures on the Closing Date,  Borrower shall not permit any item of
Equipment to become a fixture to real estate or an accession to other  property,
and such Equipment shall at all times remain personal property.

        6.9 Taxes. Cause all assessments and taxes, whether real,  personal,  or
otherwise,  due or payable by, or imposed,  levied, or assessed against Borrower
or any of its  property  to be paid in full,  before  delinquency  or before the
expiration  of any extension  period,  except to the extent that the validity of
such  assessment  or tax shall be the subject of a Permitted  Protest.  Borrower
shall make due and timely  payment or deposit of all such  federal,  state,  and
local  taxes,  assessments,  or  contributions  required of it by law,  and will
execute and deliver to Foothill, on demand,  appropriate  certificates attesting
to the payment  thereof or deposit  with  respect  thereto.  Borrower  will make
timely payment or deposit of all tax payments and withholding  taxes required of
it by applicable laws, including those laws concerning F.I.C.A., F.U.T.A., state
disability,  and local, state, and federal income taxes, and will, upon request,
furnish  Foothill with proof  satisfactory to Foothill  indicating that Borrower
has made such payments or deposits.

        6.10 Insurance.

             (a) (i) At its expense, keep the Collateral insured against loss or
damage by fire, theft,  explosion,  and sprinklers,  and in such amounts, as are
ordinarily insured against by other owners in similar businesses.  Borrower also
shall  maintain  public  liability,   product  liability,  and  property  damage
insurance relating to Borrower's ownership and use of the Collateral.

                 (ii) At its or Guarantor's expense, cause Guarantor to keep the
assets and  operations  of  Guarantor  insured  against  loss or damage by fire,
theft, explosion, and sprinklers, and in such amounts, as are ordinarily insured
against  by other  owners in  similar  businesses.  Borrower  also  shall  cause
Guarantor  to  maintain  business   interruption,   public  liability,   product
liability,  and property damage insurance relating to Guarantor's  ownership and
use of its assets.

             (b) All such policies of insurance shall be in such form, with such
companies,  and in such amounts as may be reasonably  satisfactory  to Foothill.
All hazard  insurance and such other insurance as Foothill shall specify,  shall
contain a California  Form 438BFU (NS) mortgagee  endorsement,  or an equivalent
endorsement  satisfactory  to  Foothill,  showing  Foothill  as sole loss  payee
thereof,  and shall  contain a waiver of  warranties.  Every policy of insurance
referred to in this Section 6.10 shall  contain an agreement by the insurer that
it will not cancel  such policy  except  after 30 days prior  written  notice to
Foothill and that any loss payable  thereunder shall be payable  notwithstanding
any act or negligence of Borrower,  Guarantor,  or Foothill which might,  absent
such  agreement,  result  in a  forfeiture  of all or a part of  such  insurance
payment. Borrower shall deliver to Foothill certified copies of such policies of
insurance and evidence of the payment of all premiums therefor.

             (c)  Original  policies or  certificates  thereof  satisfactory  to
Foothill  evidencing  such insurance  shall be delivered to Foothill at least 30
days prior to the  expiration  of the existing or preceding  policies.  Borrower
shall give  Foothill  prompt notice of any loss covered by such  insurance,  and
Foothill  shall  have the right to  adjust  any loss.  Foothill  shall  have the
exclusive  right to adjust all losses payable under any such insurance  policies
without any liability to Borrower whatsoever in respect of such adjustments. Any
monies received as payment for any loss under any insurance policy including the
insurance policies mentioned above, shall be paid over to Foothill to be applied
at the option of Foothill  either to the prepayment of the  Obligations  without
premium, in such order or manner as Foothill may elect, or shall be disbursed to
Borrower under stage payment terms  satisfactory  to Foothill for application to
the cost of repairs,  replacements, or restorations.  All repairs, replacements,
or restorations  shall be effected with reasonable  promptness and shall be of a
value at least  equal to the value of the items or property  destroyed  prior to
such damage or destruction. Upon the occurrence of an Event of Default, Foothill
shall  have the  right to apply  all  prepaid  premiums  to the  payment  of the
Obligations in such order or form as Foothill shall determine.

             (d) Borrower  shall not take out separate  insurance  concurrent in
form or  contributing  in the event of loss with that  required to be maintained
under this Section 6.10,  unless  Foothill is included  thereon as named insured
with the loss  payable to  Foothill  under a  standard  California  438BFU  (NS)
Mortgagee  endorsement,  or its local  equivalent.  Borrower  immediately  shall
notify Foothill  whenever such separate  insurance is taken out,  specifying the
insurer thereunder and full particulars as to the policies  evidencing the same,
and originals of such policies immediately shall be provided to Foothill.

        6.11 No Setoffs or Counterclaims.  Make payments hereunder and under the
other Loan Documents by or on behalf of Borrower  without setoff or counterclaim
and free and clear of, and without  deduction or  withholding  for or on account
of, any federal, state, or local taxes.

        6.12  Location  of  Inventory  and  Equipment.  Keep the  Inventory  and
Equipment only at the locations identified on Schedule 6.12; provided,  however,
that  Borrower  may  amend  Schedule  6.12 so long as such  amendment  occurs by
written  notice to Foothill not less than 30 days prior to the date on which the
Inventory  or  Equipment  is  moved to such  new  location,  so long as such new
location is within the continental United States, and so long as, at the time of
such written notification, Borrower provides any financing statements or fixture
filings  necessary  to  perfect  and  continue  perfected   Foothill's  security
interests  in such  assets and also  provides to  Foothill a  Collateral  Access
Agreement.

        6.13  Compliance  with  Laws.   Comply  with  the  requirements  of  all
applicable laws, rules,  regulations,  and orders of any governmental authority,
including the Fair Labor Standards Act and the Americans With  Disabilities Act,
other than laws, rules,  regulations,  and orders the non-compliance with which,
individually  or in the  aggregate,  would not have and could not  reasonably be
expected to have a Material Adverse Change.

        6.14 Employee Benefits.

             (a) Cause to be delivered to Foothill,  each of the following:  (i)
promptly,  and in any event within 10 Business Days after any Borrower  knows or
has reason to know that an ERISA Event has  occurred  that  reasonably  could be
expected to result in a Material  Adverse  Change,  a written  statement  of the
chief financial officer of LaserSight describing such ERISA Event and any action
that is being taking with respect thereto by any Borrower or an ERISA Affiliate,
and any action taken or  threatened by the IRS,  Department  of Labor,  or PBGC,
(ii) promptly,  and in any event within 3 Business Days after the filing thereof
with the IRS, a copy of each funding  waiver  request  filed with respect to any
Benefit  Plan  and  all  communications  received  by any  Borrower  or,  to the
knowledge of any Borrower, any ERISA Affiliate with respect to such request, and
(iii)  promptly,  and in any event within 3 Business  Days after  receipt by any
Borrower or, to the knowledge of any Borrower,  any ERISA Affiliate,  of written
notice of the PBGC's  intention to terminate a Benefit Plan or to have a trustee
appointed to administer a Benefit Plan, copies of each such notice.  Borrower or
any ERISA Affiliate,  as applicable,  shall be deemed to know all facts known by
the administrator of any Benefit Plan of which it is the plan sponsor.

             (b) Cause to be  delivered to Foothill,  upon  Foothill's  request,
each of the  following:  (i) a copy of each Plan (or, where any such plan is not
in writing,  complete  description  thereof) (and, if applicable,  related trust
agreements or other funding instruments) and all amendments thereto, all written
interpretations   thereof  and  written  descriptions  thereof  that  have  been
distributed to employees or former  employees of Borrower;  (ii) the most recent
determination  letter issued by the IRS with respect to each Benefit Plan; (iii)
for the three  most  recent  plan  years,  annual  reports  on Form 5500  Series
required to be filed with any  governmental  agency for each Benefit Plan;  (iv)
all actuarial  reports prepared for the last 3 plan years for each Benefit Plan;
(v) a listing of all Multiemployer  Plans, with the aggregate amount of the most
recent  annual  contributions  required to be made by any  Borrower or any ERISA
Affiliate to each such plan and copies of the collective  bargaining  agreements
requiring such contributions; (vi) any information that has been provided to any
Borrower  or any  ERISA  Affiliate  regarding  withdrawal  liability  under  any
Multiemployer  Plan;  and (vii) the  aggregate  amount of the most recent annual
payments made to former employees of Borrower under any Retiree Health Plan.

        6.15 Leases.  Pay when due all rents and other amounts payable under any
leases to which Borrower is a party or by which Borrower's properties and assets
are bound,  unless such payments are the subject of a Permitted Protest.  To the
extent  that  Borrower  fails  timely to make  payment  of such  rents and other
amounts  payable when due under its leases,  Foothill shall be entitled,  in its
discretion,  to reserve  an amount  equal to such  unpaid  amounts  against  the
Borrowing Base.

        6.16 Purchase Agreements. Within 5 days of the execution and delivery of
any Purchase Agreement between Technologies and an Account Debtor,  Technologies
shall deliver physical possession of such agreement to Foothill.

        6.17 Broker Indemnity.  Pay any and all brokerage  commission or finders
fees  incurred  in  connection  with  or as a  result  of  Borrower's  obtaining
financing from Foothill under this Agreement.

     7. NEGATIVE COVENANTS.

        Each Borrower covenants and agrees that, so long as any credit hereunder
shall be available  and until full and final  payment of the  Obligations,  such
Borrower  will not do any of the  following  without  Foothill's  prior  written
consent:

        7.1 Indebtedness. Create, incur, assume, permit, guarantee, or otherwise
become  or  remain,   directly  or  indirectly,   liable  with  respect  to  any
Indebtedness, except:

             (a) Indebtedness evidenced by this Agreement;

             (b) Indebtedness  set forth in the latest  financial  statements of
LaserSight and its Subsidiaries submitted to Foothill on or prior to the Closing
Date;

             (c) Indebtedness secured by Permitted Liens; and

             (d) refinancings, renewals, or extensions of Indebtedness permitted
under clauses (b) and (c) of this Section 7.1 (and continuance or renewal of any
Permitted Liens  associated  therewith) so long as: (i) the terms and conditions
of such  refinancings,  renewals,  or  extensions do not  materially  impair the
prospects  of  repayment  of the  Obligations  by  Borrower,  (ii)  the net cash
proceeds  of such  refinancings,  renewals,  or  extensions  do not result in an
increase in the aggregate  principal  amount of the  Indebtedness so refinanced,
renewed,  or  extended,  (iii)  such  refinancings,   renewals,  refundings,  or
extensions do not result in a shortening of the average weighted maturity of the
Indebtedness so refinanced,  renewed,  or extended,  and (iv) to the extent that
Indebtedness  that is  refinanced  was  subordinated  in right of payment to the
Obligations,  then the  subordination  terms and  conditions of the  refinancing
Indebtedness  must be at least as favorable to Foothill as those  applicable  to
the refinanced Indebtedness.

        7.2  Liens.  Create,  incur,  assume,  or permit to exist,  directly  or
indirectly, any Lien on or with respect to any of its property or assets, of any
kind,  whether  now  owned or  hereafter  acquired,  or any  income  or  profits
therefrom,  except for Permitted Liens (including Liens that are replacements of
Permitted Liens to the extent that the original Indebtedness is refinanced under
Section 7.1(d) and so long as the  replacement  Liens only encumber those assets
or property that secured the original Indebtedness).

        7.3  Restrictions  on  Fundamental  Changes.   Enter  into  any  merger,
consolidation,  reorganization,  or recapitalization,  or reclassify its capital
stock,  or liquidate,  wind up, or dissolve itself (or suffer any liquidation or
dissolution), or convey, sell, assign, lease, transfer, or otherwise dispose of,
in one transaction or a series of  transactions,  all or any substantial part of
its property or assets; provided,  however, that any Non-Material Subsidiary may
merge with and into any  Borrower,  so long as that  Borrower  is the  surviving
corporation.  For the avoidance of any doubt,  the  consummation  of a Permitted
Patent Acquisition Transaction shall not be deemed to violate this Section 7.3.

        7.4 Disposal of Assets. Except for Permitted Dispositions,  sell, lease,
assign,  transfer,  or  otherwise  dispose of any of  Borrower's  properties  or
assets.

        7.5 Change Name. Change any Borrower's name, FEIN,  corporate  structure
(within the meaning of Section 9402(7) of the Code), or identity, or add any new
fictitious name.

        7.6  Guarantee.  Guarantee  or  otherwise  become in any way liable with
respect  to the  obligations  of any  third  Person  except  by  endorsement  of
instruments  or items of payment for  deposit to the account of any  Borrower or
which are transmitted or turned over to Foothill.

        7.7 Nature of Business.  (a) Make any change in the principal  nature of
Technologies'  business,  or (b) make any  change  in the  principal  nature  of
Borrower's  business  taken  as a  whole.  For the  avoidance  of any  doubt,  a
Permitted  Patent  Acquisition  Transaction  shall not be deemed to violate this
Section 7.7.

        7.8 Prepayments and Amendments.

             (a) Except in connection  with a  refinancing  permitted by Section
7.1(d),  prepay,  redeem,  retire,  defease,  purchase, or otherwise acquire any
Indebtedness owing to any third Person, other than the Obligations in accordance
with this Agreement, and

             (b) Directly or indirectly,  amend,  modify,  alter,  increase,  or
change any of the terms or conditions of any  agreement,  instrument,  document,
indenture,  or other writing  evidencing or  concerning  Indebtedness  permitted
under Sections 7.1(b), (c), or (d).

        7.9 Change of Control. Cause, permit, or suffer, directly or indirectly,
any Change of Control.

        7.10  Consignments.  Consign any Inventory or sell any Inventory on bill
and hold, sale or return, sale on approval,  or other conditional terms of sale.
For the avoidance of doubt,  LaserSight's practice of providing an excimer laser
for offshore tradeshows,  clinical trials, or research and development,  in each
case,  in the ordinary  course of business,  shall not be deemed to violate this
Section 7.10.

        7.11  Distributions.  Make  any  distribution  or  declare  or  pay  any
dividends (in cash or other property, other than capital stock) on, or purchase,
acquire,  redeem,  or retire any of any Borrower's  capital stock, of any class,
whether now or hereafter outstanding.

        7.12  Accounting  Methods.  Modify or change its method of accounting or
enter into,  modify, or terminate any agreement  currently  existing,  or at any
time  hereafter  entered  into with any third party  accounting  firm or service
bureau  for the  preparation  or storage of any  Borrower's  accounting  records
without said  accounting  firm or service  bureau  agreeing to provide  Foothill
information  regarding the Collateral or such  Borrower's  financial  condition.
Each Borrower waives the right to assert a confidential relationship, if any, it
may have with any  accounting  firm or  service  bureau in  connection  with any
information  requested  by  Foothill  pursuant  to or in  accordance  with  this
Agreement,  and agrees that  Foothill may contact  directly any such  accounting
firm or service bureau in order to obtain such  information  in accordance  with
such accounting firm's or service bureau's policies and procedures.

        7.13 Investments.  Other than with respect to Guarantor or in connection
with a Permitted Patent  Acquisition  Transaction,  directly or indirectly make,
acquire, or incur any liabilities  (including contingent  obligations) for or in
connection with (a) the  acquisition of the securities  (whether debt or equity)
of, or other interests in, a Person, (b) loans, advances, capital contributions,
or  transfers  of  property  to a  Person,  or  (c)  the  acquisition  of all or
substantially all of the properties or assets of a Person.

        7.14 Transactions with Affiliates.  Directly or indirectly enter into or
permit to exist any  material  transaction  with any  Affiliate  of any Borrower
except for (a) transactions  entered into prior to the Closing Date as set forth
in detail on Schedule  7.14(a),  or (b)  transactions  that are in the  ordinary
course of a Borrower's business,  upon fair and reasonable terms, that are fully
disclosed to Foothill,  and that are no less  favorable  to such  Borrower  than
would be obtained in an arm's length transaction with a non-Affiliate.

        7.15 Suspension.  Suspend or go out of all or  substantially  all of its
business.

        7.16 Compensation.  (a) Increase the annual fee or per-meeting fees paid
to directors during any year by more than 15% over the prior year.

             (b) Pay or accrue  total cash  compensation,  during  any year,  to
officers and senior  management  employees  in an aggregate  amount in excess of
115% of that paid or accrued in the prior year; provided,  however,  that if any
Borrower hires or appoints an officer (who is not a replacement for another such
officer),  the total cash  compensation  paid or accrued by such  Borrower  with
respect to such individual  (the "Additive  Amount") during such year of hire or
appointment  (the "Hire Year") shall not be included in the aggregate  amount of
total cash  compensation paid or accrued by Borrower for purposes of calculating
whether  Borrower  exceeded  the  aggregate  amount of total  cash  compensation
allowable  during  such  year;  provided  further,  however,  that,  in the year
following the Hire Year, the Additive  Amount  (annualized if the individual was
hired or appointed for less than a full year) shall be included in the aggregate
amount of total cash  compensation paid or accrued by such Borrower for the Hire
Year solely for the purpose of calculating the total cash  compensation  paid or
accrued by such Borrower for the prior year.

        7.17 Use of Proceeds. Use the proceeds of the Advances and the Term Loan
made  hereunder for any purpose other than (a) on the Closing Date, (i) to repay
in full the  outstanding  principal,  accrued  interest,  and  accrued  fees and
expenses  owing to  Existing  Lender,  and (ii) to pay  transactional  costs and
expenses  incurred  in  connection  with  this  Agreement,  and (b)  thereafter,
consistent  with the terms and conditions  hereof,  for its lawful and permitted
corporate purposes.

        7.18  Change  in  Location  of Chief  Executive  Office;  Inventory  and
Equipment with Bailees.  Relocate its chief  executive  office to a new location
without providing 30 days prior written  notification thereof to Foothill and so
long as, at the time of such written  notification,  such Borrower  provides any
financing  statements  or fixture  filings  necessary  to perfect  and  continue
perfected  Foothill's  security  interests  and  also  provides  to  Foothill  a
Collateral Access Agreement with respect to such new location. The Inventory and
Equipment  shall  not at any time now or  hereafter  be  stored  with a  bailee,
warehouseman,  or similar party without Foothill's prior written consent, except
for Inventory,  in an amount not to exceed  $300,000 in the  aggregate,  that is
located at one or more of the  locations  identified on Schedule 6.12 as being a
warehouse and as to which Borrower timely has delivered to Foothill a Collateral
Access Agreement from such bailee.

        7.19 No Prohibited Transactions Under ERISA. Directly or indirectly:

             (a) engage,  or permit any  Subsidiary of LaserSight to engage,  in
any  prohibited  transaction  which is  reasonably  likely  to result in a civil
penalty or excise tax  described in Sections 406 of ERISA or 4975 of the IRC for
which a statutory or class exemption is not available or a private exemption has
not been previously obtained from the Department of Labor;

             (b)  permit  to  exist  with   respect  to  any  Benefit  Plan  any
accumulated  funding  deficiency (as defined in Sections 302 of ERISA and 412 of
the IRC), whether or not waived;

             (c) fail,  or permit any  Subsidiary  of LaserSight to fail, to pay
timely required  contributions  or annual  installments  due with respect to any
waived funding deficiency to any Benefit Plan;

             (d) terminate, or permit any Subsidiary of LaserSight to terminate,
any Benefit Plan where such event would result in any  liability of  LaserSight,
any of its  Subsidiaries,  or any ERISA  Affiliate to the PBGC under Title IV of
ERISA;

             (e) fail,  or permit any  Subsidiary of LaserSight to fail, to make
any required contribution or payment to any Multiemployer Plan;

             (f) fail,  or permit any  Subsidiary  of LaserSight to fail, to pay
any required  installment or any other payment required under Section 412 of the
IRC on or before the due date for such installment or other payment;

             (g) amend,  or permit any Subsidiary of LaserSight to amend, a Plan
resulting in an increase in current liability for the plan year such that either
of LaserSight,  any Subsidiary of LaserSight, or any ERISA Affiliate is required
to provide security to such Plan under Section 401(a)(29) of the IRC; or

             (i) withdraw,  or permit any  Subsidiary of LaserSight to withdraw,
from any Multiemployer Plan where such withdrawal is reasonably likely to result
in any liability of any such entity under Title IV of ERISA;

which,  individually  or in the  aggregate,  results in or  reasonably  would be
expected to result in a claim  against or  liability of  LaserSight,  any of its
Subsidiaries, or any ERISA Affiliate in excess of $1.00.

        7.20 Financial Covenants. Commencing with the fiscal quarter ending June
30, 1997 and thereafter, fail to maintain:

             (a) Current Ratio. A ratio of  Consolidated  Current Assets divided
by Consolidated  Current Liabilities of at least 1.5 : 1.0, measured on a fiscal
quarter-end basis;


             (b) Unit and Revenue Volume. Minimum unit sales of ophthalmic laser
systems and consolidated  revenue (after laser commissions) during the following
periods, as measured on a cumulative basis at the end of each fiscal quarter:

                                                     Minimum Consolidated
Fiscal Quarter             Minimum Unit Volume            Net Revenue
--------------             -------------------            -----------
                                                                          
June 30, 1997                      14                     $ 5,291,000
September 30, 1997                 28                     $11,674,000
December 31, 1997                  42                     $18,793,000
March 31, 1998                     60                     $27,560,000
June 30, 1998                      77                     $37,025,000
September 30, 1998                109                     $50,760,000

             (c) Consolidated  EBITDA.  Minimum  consolidated  EBITDA during the
following  periods,  as measured on a cumulative basis at the end of each fiscal
quarter:

Fiscal Quarter                            Minimum Consolidated EBITDA
--------------                            ---------------------------

June 30, 1997                                     $ (355,000)
September 30, 1997                                $  552,000
December 31, 1997                                 $1,747,000
March 31, 1998                                    $2,942,000
June 30, 1998                                     $4,203,000
September 30, 1998                                $7,515,000

             (d) Contract Receivable  Maintenance.  An amount, in the aggregate,
due and payable to Technologies  pursuant to Purchase  Agreements then in effect
of not  less  than  120%  of  the  aggregate  amount  of  the  Obligations  then
outstanding under this Agreement, measured on a fiscal quarter-end basis.

        7.21 Capital Expenditures.  Make capital expenditures in any fiscal year
in excess of $900,000.

        7.22   Non-Material   Subsidiaries.   Cause,   suffer,   or  permit  any
Non-Material  Subsidiary  to have any property or assets with an aggregate  book
value in excess of $50,000 or to engage in any material business activity.

     8. EVENTS OF DEFAULT.

        Any one or more of the  following  events shall  constitute  an event of
default (each, an "Event of Default") under this Agreement:

        8.1 If Borrower  fails to pay when due and payable or when  declared due
and payable,  any portion of the  Obligations  (whether of  principal,  interest
(including any interest  which,  but for the provisions of the Bankruptcy  Code,
would  have  accrued  on  such   amounts),   fees  and  charges  due   Foothill,
reimbursement of Foothill Expenses, or other amounts constituting  Obligations);
provided,  however,  that in the case of  Overadvances  that are  caused  by the
charging of interest, fees, or Foothill Expenses to the Loan Account, such event
shall not constitute an Event of Default if, within 5 Business Days of incurring
such Overadvance, Borrower repays, or otherwise eliminates, such Overadvance;

        8.2 (a) If Borrower  fails or neglects to perform,  keep, or observe any
term,  provision,  condition,  covenant,  or agreement contained in Sections 6.2
(Collateral Reporting), 6.3 (Financial Statements, Reports,  Certificates),  6.4
(Tax Returns), 6.12 (Location of Inventory and Equipment), 6.13 (Compliance with
Laws),  6.14  (Employee  Benefits),  or 6.15 (Leases) of this Agreement and such
failure  continues  for a period of 5 Business  Days;  (b) If Borrower  fails or
neglects to perform, keep, or observe any term, provision,  condition, covenant,
or agreement  contained in Sections 6.1 (Accounting  System) or 6.8 (Maintenance
of  Equipment) of this  Agreement and such failure  continues for a period of 15
Business  Days;  or (c) If Borrower or  Guarantor  fails or neglects to perform,
keep, or observe any other term,  provision,  condition,  covenant, or agreement
contained  in this  Agreement,  or in any of the other  Loan  Documents  (giving
effect  to any  grace  periods,  cure  periods,  or  required  notices,  if any,
expressly  provided for in such Loan  Documents);  in each case,  other than any
such term, provision,  condition,  covenant, or agreement that is the subject of
another provision of this Section 8, in which event such other provision of this
Section 8 shall govern);  provided that, during any period of time that any such
failure  or neglect of  Borrower  or  Guarantor  referred  to in this  paragraph
exists, even if such failure or neglect is not yet an Event of Default by virtue
of the existence of a grace or cure period or the pre-condition of the giving of
a notice,  Foothill shall not be required during such period to make Advances to
Borrower;

        8.3 If there is a Material Adverse Change;

        8.4 If any  material  portion  of  Borrower's  properties  or  assets is
attached, seized, subjected to a writ or distress warrant, or is levied upon, or
comes into the possession of any third Person;

        8.5 If an Insolvency Proceeding is commenced by Borrower;

        8.6 If an Insolvency Proceeding is commenced against Borrower and any of
the following  events occur:  (a) Borrower  consents to the  institution  of the
Insolvency  Proceeding  against it; (b) the petition  commencing  the Insolvency
Proceeding  is  not  timely  controverted;   (c)  the  petition  commencing  the
Insolvency  Proceeding is not  dismissed  within 45 calendar days of the date of
the filing thereof; provided, however, that, during the pendency of such period,
Foothill shall be relieved of its obligation to extend credit hereunder;  (d) an
interim trustee is appointed to take possession of all or a substantial  portion
of the properties or assets of, or to operate all or any substantial  portion of
the business of, Borrower;  or (e) an order for relief shall have been issued or
entered therein;

        8.7 If Borrower is  enjoined,  restrained,  or in any way  prevented  by
court order from  continuing to conduct all or any material part of its business
affairs;

        8.8 If a notice of Lien,  levy,  or  assessment  is filed of record with
respect  to any  of  Borrower's  properties  or  assets  by  the  United  States
Government,  or any department,  agency, or instrumentality  thereof,  or by any
state, county, municipal, or governmental agency, or if any taxes or debts owing
at any  time  hereafter  to any one or more of  such  entities  becomes  a Lien,
whether choate or otherwise, upon any of Borrower's properties or assets and the
same is not paid on the payment date thereof;

        8.9 If a judgment or other claim becomes a Lien or encumbrance  upon any
material portion of Borrower's properties or assets;

        8.10 If there is a default in any material  agreement to which  Borrower
is a party with one or more third  Persons  and such  default  (a) occurs at the
final maturity of the obligations thereunder,  or (b) results in a right by such
third Person(s),  irrespective of whether exercised,  to accelerate the maturity
of Borrower's obligations thereunder;

        8.11 If Borrower makes any payment on account of  Indebtedness  that has
been  contractually  subordinated  in right of  payment  to the  payment  of the
Obligations,  except to the extent such payment is permitted by the terms of the
subordination provisions applicable to such Indebtedness;

        8.12 If any material  misstatement  or  misrepresentation  exists now or
hereafter in any warranty, representation, statement, or report made to Foothill
by Borrower or any officer,  employee, agent, or director of Borrower, or if any
such warranty or representation is withdrawn; or

        8.13 If the  obligation  of any  guarantor  under its  guaranty or other
third Person under any Loan  Document is limited or  terminated  by operation of
law or by the guarantor or other third Person thereunder,  or any such guarantor
or other third Person becomes the subject of an Insolvency Proceeding.

     9. FOOTHILL'S RIGHTS AND REMEDIES.

        9.1  Rights  and  Remedies.   Upon  the   occurrence,   and  during  the
continuation,  of an Event of Default  Foothill  may, at its  election,  without
notice of its election and without demand,  do any one or more of the following,
all of which are authorized by each Borrower:

             (a) Declare all Obligations,  whether  evidenced by this Agreement,
by any of the other Loan Documents, or otherwise, immediately due and payable;

             (b) Cease advancing money or extending credit to or for the benefit
of Borrower under this Agreement,  under any of the Loan Documents, or under any
other agreement between Borrower and Foothill;

             (c) Terminate this Agreement and any of the other Loan Documents as
to any future  liability  or  obligation  of  Foothill,  but  without  affecting
Foothill's rights and security interests in the Collateral and without affecting
the Obligations;

             (d) Settle or adjust  disputes  and claims  directly  with  Account
Debtors for amounts and upon terms which Foothill  considers  advisable,  and in
such cases,  Foothill  will credit  Borrower's  Loan  Account  with only the net
amounts  received by Foothill in payment of such disputed  contract  receivables
after  deducting  all  Foothill  Expenses  incurred or  expended  in  connection
therewith;

             (e) Cause  Borrower  to hold all  returned  Inventory  in trust for
Foothill,  segregate all returned  Inventory from all other property of Borrower
or in Borrower's  possession and conspicuously  label said returned Inventory as
the property of Foothill;

             (f)  Without  notice to or demand upon  Borrower or any  guarantor,
make  such  payments  and do  such  acts  as  Foothill  considers  necessary  or
reasonable to protect its security  interests in the  Collateral.  Each Borrower
agrees to assemble  the  Collateral  if Foothill  so  requires,  and to make the
Collateral  available  to Foothill  as Foothill  may  designate.  Each  Borrower
authorizes  Foothill to enter the premises where the  Collateral is located,  to
take and maintain  possession of the Collateral,  or any part of it, and to pay,
purchase,  contest,  or  compromise  any  encumbrance,  charge,  or Lien that in
Foothill's  determination appears to conflict with its security interests and to
pay all  expenses  incurred  in  connection  therewith.  With  respect to any of
Borrower's  owned or leased  premises,  each Borrower  hereby grants  Foothill a
license  to enter  into  possession  of such  premises  and to occupy  the same,
without charge, for up to 120 days in order to exercise any of Foothill's rights
or remedies provided herein, at law, in equity, or otherwise;

             (g)  Without  notice  to  Borrower  (such  notice  being  expressly
waived),  and without constituting a retention of any collateral in satisfaction
of an obligation  (within the meaning of Section 9505 of the Code),  set off and
apply to the  Obligations any and all (i) balances and deposits of Borrower held
by Foothill  (including any amounts received in the Lockbox  Accounts),  or (ii)
indebtedness  at any time owing to or for the credit or the  account of Borrower
held by Foothill;

             (h) Hold, as cash collateral,  any and all balances and deposits of
Borrower held by Foothill,  and any amounts received in the Lockbox Accounts, to
secure the full and final repayment of all of the Obligations;

             (i)  Ship,  reclaim,  recover,  store,  finish,  maintain,  repair,
prepare  for sale,  advertise  for sale,  and sell (in the manner  provided  for
herein) the  Collateral.  Foothill hereby is granted a license or other right to
use, without charge,  Borrower's labels, patents,  copyrights,  rights of use of
any name, trade secrets, trade names, trademarks, service marks, and advertising
matter,  or any property of a similar nature,  as it pertains to the Collateral,
in completing  production of,  advertising  for sale, and selling any Collateral
and  Borrower's  rights under all licenses and all  franchise  agreements  shall
inure to Foothill's benefit;

             (j) Sell the  Collateral  at either a public or  private  sale,  or
both, by way of one or more contracts or transactions,  for cash or on terms, in
such  manner and at such  places  (including  Borrower's  premises)  as Foothill
determines is commercially  reasonable.  It is not necessary that the Collateral
be present at any such sale;

             (k) Foothill shall give notice of the disposition of the Collateral
as follows:

                 (1) Foothill  shall give Borrower and each holder of a security
interest in the  Collateral  who has filed with  Foothill a written  request for
notice,  a notice in  writing of the time and place of public  sale,  or, if the
sale is a private sale or some other  disposition other than a public sale is to
be made of the  Collateral,  then the time on or after which the private sale or
other disposition is to be made;

                 (2) The notice shall be personally delivered or mailed, postage
prepaid,  to Borrower as provided in Section 12, at least 5 days before the date
fixed for the sale,  or at least 5 days  before  the date on or after  which the
private  sale or other  disposition  is to be made;  no notice needs to be given
prior to the  disposition of any portion of the Collateral that is perishable or
threatens to decline  speedily in value or that is of a type customarily sold on
a recognized market.  Notice to Persons other than Borrower claiming an interest
in the  Collateral  shall be sent to such  addresses  as they have  furnished to
Foothill;

                 (3) If the sale is to be a public  sale,  Foothill  also  shall
give  notice of the time and place by  publishing  a notice  one time at least 5
days before the date of the sale in a newspaper  of general  circulation  in the
county in which the sale is to be held;

             (l) Foothill may credit bid and purchase at any public sale; and

             (m) Any deficiency that exists after  disposition of the Collateral
as  provided  above will be paid  immediately  by  Borrower.  Any excess will be
returned,  without  interest  and  subject  to the rights of third  Persons,  by
Foothill to Borrower.

             9.2 Remedies Cumulative.  Foothill's rights and remedies under this
Agreement,  the Loan Documents,  and all other  agreements  shall be cumulative.
Foothill shall have all other rights and remedies not  inconsistent  herewith as
provided  under the Code,  by law, or in equity.  No exercise by Foothill of one
right or remedy  shall be deemed an  election,  and no waiver by Foothill of any
Event of Default shall be deemed a continuing waiver. No delay by Foothill shall
constitute a waiver, election, or acquiescence by it.

     10. TAXES AND EXPENSES

        If  Borrower  fails  to pay  any  monies  (whether  taxes,  assessments,
insurance  premiums,  or, in the case of leased  properties or assets,  rents or
other amounts payable under such leases) due to third Persons,  or fails to make
any  deposits  or furnish  any  required  proof of payment  or  deposit,  all as
required  under the terms of this  Agreement,  then, to the extent that Foothill
determines  that such  failure by Borrower  could  result in a Material  Adverse
Change, in its discretion and without prior notice to Borrower,  Foothill may do
any or all of the  following:  (a) make payment of the same or any part thereof;
(b) set up such reserves in Borrower's  Loan Account as Foothill deems necessary
to protect Foothill from the exposure created by such failure; or (c) obtain and
maintain  insurance policies of the type described in Section 6.10, and take any
action with respect to such policies as Foothill deems prudent. Any such amounts
paid by Foothill shall constitute  Foothill Expenses.  Any such payments made by
Foothill shall not constitute an agreement by Foothill to make similar  payments
in the  future  or a waiver  by  Foothill  of any Event of  Default  under  this
Agreement. Foothill need not inquire as to, or contest the validity of, any such
expense,  tax,  or Lien and the  receipt  of the usual  official  notice for the
payment  thereof shall be conclusive  evidence that the same was validly due and
owing.

     11. WAIVERS; INDEMNIFICATION

        11.1 Demand;  Protest; etc. Each Borrower waives demand, protest, notice
of protest,  notice of default or  dishonor,  notice of payment and  nonpayment,
nonpayment at maturity, release, compromise,  settlement,  extension, or renewal
of accounts, documents,  instruments,  chattel paper, and guarantees at any time
held by Foothill on which such Borrower may in any way be liable.

        11.2 Foothill's  Liability for Collateral.  So long as Foothill complies
with its obligations, if any, under Section 9207 of the Code, Foothill shall not
in any way or manner be liable or  responsible  for: (a) the  safekeeping of the
Collateral; (b) any loss or damage thereto occurring or arising in any manner or
fashion from any cause; (c) any diminution in the value thereof;  or (d) any act
or default of any carrier,  warehouseman,  bailee,  forwarding  agency, or other
Person.  All risk of loss,  damage,  or destruction  of the Collateral  shall be
borne by Borrower.

        11.3  Indemnification.  Each Borrower shall pay, indemnify,  defend, and
hold  Foothill,  each  Participant,  and  each  of  their  respective  officers,
directors,   employees,   counsel,   agents,  and  attorneys-in-fact  (each,  an
"Indemnified Person") harmless (to the fullest extent permitted by law) from and
against  any  and  all  claims,   demands,   suits,   actions,   investigations,
proceedings,  and damages,  and all reasonable  attorneys fees and disbursements
and other costs and expenses actually  incurred in connection  therewith (as and
when they are incurred and irrespective of whether suit is brought), at any time
asserted against, imposed upon, or incurred by any of them in connection with or
as a result of or related to the execution, delivery, enforcement,  performance,
and  administration  of this  Agreement  and any  other  Loan  Documents  or the
transactions  contemplated  herein,  and  with  respect  to  any  investigation,
litigation, or proceeding related to this Agreement, any other Loan Document, or
the use of the  proceeds  of the  credit  provided  hereunder  (irrespective  of
whether any Indemnified Person is a party thereto), or any act, omission,  event
or circumstance in any manner related thereto (all the foregoing,  collectively,
the  "Indemnified  Liabilities").  Borrower  shall  have  no  obligation  to any
Indemnified  Person  under this  Section  11.3 with  respect to any  Indemnified
Liability  that a court of competent  jurisdiction  finally  determines  to have
resulted  from the gross  negligence or willful  misconduct of such  Indemnified
Person.  This provision  shall survive the termination of this Agreement and the
repayment of the Obligations.

     12. NOTICES

        Unless otherwise  provided in this Agreement,  all notices or demands by
any party  relating to this  Agreement  or any other Loan  Document  shall be in
writing and (except for financial  statements and other informational  documents
which may be sent by  first-class  mail,  postage  prepaid)  shall be personally
delivered or sent by  registered  or certified  mail  (postage  prepaid,  return
receipt  requested),  overnight  courier,  or  telefacsimile  to  Borrower or to
Foothill, as the case may be, at its address set forth below:

        If to any Borrower:       c/o LASERSIGHT INCORPORATED
                                  12161 Lackland Road
                                  St. Louis, Missouri 63146
                                  Attn: Mr. Gregory Wilson
                                  Fax No. 314.576.1073

        with copies to:           SONNENSCHEIN NATH & ROSENTHAL
                                  1 Metropolitan Square
                                  Suite 3000
                                  St. Louis, Missouri 63102
                                  Attn:  Alan Bornstein, Esq.
                                  Fax No. 314.259.5959

        If to Foothill:           FOOTHILL CAPITAL CORPORATION
                                  11111 Santa Monica Boulevard
                                  Suite 1500
                                  Los Angeles, California 90025-3333
                                  Attn:  Business Finance Division Manager
                                  Fax No. 310.478.9788

        with copies to:           BROBECK, PHLEGER & HARRISON LLP
                                  550 South Hope Street
                                  Los Angeles, California 90071
                                  Attn:  John Francis Hilson, Esq.
                                  Fax No. 213.745.3345

        The  parties  hereto may change the address at which they are to receive
notices  hereunder,  by notice in writing in the  foregoing  manner given to the
other.  All notices or demands  sent in  accordance  with this Section 12, other
than notices by Foothill in  connection  with Sections 9504 or 9505 of the Code,
shall be deemed  received on the earlier of the date of actual receipt or 5 days
after the deposit  thereof in the mail.  Borrower  acknowledges  and agrees that
notices sent by Foothill in  connection  with  Sections 9504 or 9505 of the Code
shall be deemed sent when  deposited in the mail or  personally  delivered,  or,
where permitted by law,  transmitted  telefacsimile  or other similar method set
forth above.

     13. CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER.

        THE  VALIDITY OF THIS  AGREEMENT  AND THE OTHER LOAN  DOCUMENTS  (UNLESS
EXPRESSLY   PROVIDED  TO  THE  CONTRARY  IN  AN  ANOTHER  LOAN  DOCUMENT),   THE
CONSTRUCTION, INTERPRETATION, AND ENFORCEMENT HEREOF AND THEREOF, AND THE RIGHTS
OF THE PARTIES HERETO AND THERETO WITH RESPECT TO ALL MATTERS ARISING  HEREUNDER
OR THEREUNDER OR RELATED HERETO OR THERETO SHALL BE DETERMINED  UNDER,  GOVERNED
BY, AND CONSTRUED IN ACCORDANCE  WITH THE LAWS OF THE STATE OF  CALIFORNIA.  THE
PARTIES AGREE THAT ALL ACTIONS OR  PROCEEDINGS  ARISING IN CONNECTION  WITH THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS  SHALL BE TRIED AND LITIGATED ONLY IN THE
STATE  AND  FEDERAL  COURTS  LOCATED  IN THE  COUNTY  OF LOS  ANGELES,  STATE OF
CALIFORNIA  OR, AT THE SOLE  OPTION  OF  FOOTHILL,  IN ANY OTHER  COURT IN WHICH
FOOTHILL  SHALL INITIATE  LEGAL OR EQUITABLE  PROCEEDINGS  AND WHICH HAS SUBJECT
MATTER  JURISDICTION  OVER THE  MATTER  IN  CONTROVERSY.  EACH OF  BORROWER  AND
FOOTHILL  WAIVES,  TO THE EXTENT  PERMITTED UNDER APPLICABLE LAW, ANY RIGHT EACH
MAY HAVE TO ASSERT THE DOCTRINE OF FORUM NON CONVENIENS OR TO OBJECT TO VENUE TO
THE  EXTENT  ANY  PROCEEDING  IS BROUGHT IN  ACCORDANCE  WITH THIS  SECTION  13.
BORROWER AND FOOTHILL  HEREBY WAIVE THEIR  RESPECTIVE  RIGHTS TO A JURY TRIAL OF
ANY  CLAIM OR CAUSE  OF  ACTION  BASED  UPON OR  ARISING  OUT OF ANY OF THE LOAN
DOCUMENTS OR ANY OF THE TRANSACTIONS  CONTEMPLATED  THEREIN,  INCLUDING CONTRACT
CLAIMS,  TORT  CLAIMS,  BREACH  OF DUTY  CLAIMS,  AND ALL  OTHER  COMMON  LAW OR
STATUTORY CLAIMS.  EACH OF BORROWER AND FOOTHILL REPRESENTS THAT IT HAS REVIEWED
THIS WAIVER AND EACH  KNOWINGLY  AND  VOLUNTARILY  WAIVES ITS JURY TRIAL  RIGHTS
FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF LITIGATION, A COPY OF
THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.

     14. DESTRUCTION OF BORROWER'S DOCUMENTS

        Except as provided in the immediately following sentence, all documents,
schedules,  invoices,  agings,  or other  papers  delivered  to Foothill  may be
destroyed or otherwise disposed of by Foothill 4 months after they are delivered
to or received by Foothill,  unless Borrower requests, in writing, the return of
said documents, schedules, or other papers and makes arrangements, at Borrower's
expense,  for their return.  Upon the payment in full in cash of the Obligations
and the  irrevocable  termination  of  Foothill's  commitment  to extend  credit
hereunder,  Foothill  shall,  at  Borrower's  expense,  return all  originals of
Purchase  Agreements,  Borrower  Letters of Credit,  and negotiable  instruments
previously delivered by Borrower to Foothill pursuant to this Agreement.

     15. GENERAL PROVISIONS

        15.1 Effectiveness. This Agreement shall be binding and deemed effective
when executed by each Borrower and Foothill.

        15.2 Successors and Assigns.  This Agreement shall bind and inure to the
benefit  of the  respective  successors  and  assigns  of each  of the  parties;
provided,  however,  that no Borrower  may assign this  Agreement  or any of its
rights or duties  hereunder  without  Foothill's  prior written  consent and any
prohibited  assignment  shall be absolutely void. No consent to an assignment by
Foothill  shall release any Borrower from its  Obligations.  Foothill may assign
this Agreement and its rights and duties hereunder and no consent or approval by
Borrower is required in connection with any such assignment.  Foothill  reserves
the right to sell, assign,  transfer,  negotiate, or grant participations in all
or any part of, or any interest in Foothill's rights and benefits hereunder.  In
connection with any such assignment or participation,  Foothill may disclose all
documents and  information  which Foothill now or hereafter may have relating to
Borrower or Borrower's business.  To the extent that Foothill assigns its rights
and  obligations  hereunder  to a third  Person,  Foothill  thereafter  shall be
released from such assigned  obligations to Borrower and such  assignment  shall
effect a novation between Borrower and such third Person.

        15.3 Section  Headings.  Headings and numbers have been set forth herein
for  convenience  only.  Unless  the  contrary  is  compelled  by  the  context,
everything contained in each section applies equally to this entire Agreement.

        15.4  Interpretation.  Neither this  Agreement  nor any  uncertainty  or
ambiguity  herein shall be construed or resolved  against  Foothill or Borrower,
whether  under any rule of  construction  or otherwise.  On the  contrary,  this
Agreement  has  been  reviewed  by  all  parties  and  shall  be  construed  and
interpreted  according to the ordinary meaning of the words used so as to fairly
accomplish the purposes and intentions of all parties hereto.

        15.5 Severability of Provisions.  Each provision of this Agreement shall
be severable  from every other  provision of this  Agreement  for the purpose of
determining the legal enforceability of any specific provision.

        15.6  Amendments  in Writing.  This  Agreement  can only be amended by a
writing signed by Foothill and each Borrower.

        15.7  Counterparts;  Telefacsimile  Execution.  This  Agreement  may  be
executed  in any number of  counterparts  and by  different  parties on separate
counterparts,  each of which, when executed and delivered, shall be deemed to be
an original, and all of which, when taken together, shall constitute but one and
the same  Agreement.  Delivery of an executed  counterpart  of this Agreement by
telefacsimile  shall be equally as effective as delivery of an original executed
counterpart of this Agreement.  Any party delivering an executed  counterpart of
this  Agreement  by  telefacsimile  also  shall  deliver  an  original  executed
counterpart  of this  Agreement but the failure to deliver an original  executed
counterpart shall not affect the validity, enforceability, and binding effect of
this Agreement.

        15.8 Revival and  Reinstatement  of  Obligations.  If the  incurrence or
payment of the  Obligations  by Borrower or any guarantor of the  Obligations or
the  transfer by either or both of such  parties to Foothill of any  property of
either or both of such parties should for any reason subsequently be declared to
be void or  voidable  under any state or  federal  law  relating  to  creditors'
rights,  including  provisions  of the  Bankruptcy  Code  relating to fraudulent
conveyances, preferences, and other voidable or recoverable payments of money or
transfers of property (collectively,  a "Voidable Transfer"), and if Foothill is
required to repay or restore,  in whole or in part, any such Voidable  Transfer,
or elects to do so upon the  reasonable  advice of its counsel,  then, as to any
such  Voidable  Transfer,  or the amount  thereof  that  Foothill is required or
elects  to repay or  restore,  and as to all  reasonable  costs,  expenses,  and
attorneys fees of Foothill  related  thereto,  the liability of Borrower or such
guarantor  automatically  shall be revived,  reinstated,  and restored and shall
exist as though such Voidable Transfer had never been made.

        15.9  Integration.   This  Agreement,   together  with  the  other  Loan
Documents,  reflects the entire understanding of the parties with respect to the
transactions  contemplated  hereby and shall not be contradicted or qualified by
any other agreement, oral or written, before the date hereof.





        IN WITNESS WHEREOF,  the parties hereto have caused this Agreement to be
executed in Los Angeles, California.


                                   LASERSIGHT INCORPORATED,
                                   a Delaware corporation


                                   By   /s/ Michael R. Farris
                                       -----------------------
                                   Title:  President/Chief Executive Officer


                                   LASERSIGHT TECHNOLOGIES, INC.,
                                   a Delaware corporation


                                   By    /s/ Gregory L. Wilson
                                        -----------------------
                                   Title:   Vice President



                                   MEC HEALTH CARE, INC.,
                                   a Maryland corporation


                                   By   /s/ Gregory L. Wilson
                                       -----------------------
                                   Title:   Vice President


                                   LSI ACQUISITION, INC.,
                                   a New Jersey corporation


                                   By   /s/ Gregory L. Wilson
                                       -----------------------
                                   Title:   Secretary/Treasurer


                                   LASERSIGHT CENTERS INCORPORATED,
                                   a Delaware corporation


                                   By    /s/ Gregory L. Wilson
                                        -----------------------
                                   Title: Vice President


                                   MRF, INC.,
                                   a Missouri corporation
                                   By    /s/ Gregory L. Wilson
                                       ------------------------
                                   Title:  Secretary/Treasurer


                                   FOOTHILL CAPITAL CORPORATION,
                                   a California corporation


                                   By:    /s/ Rhonda R. Foreman
                                         -----------------------
                                   Title:   Vice President