Document:

lens-ex101_15.htm

         Exhibit 10.1

THE SECURITIES REFERRED TO HEREIN HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR UNDER THE SECURITIES LAWS OF ANY STATE.  THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE SOLD, MORTGAGED, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED OR OFFERED TO BE SO TRANSFERRED EXCEPT AS PERMITTED UNDER THE ACT AND THE APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM.

SECURITIES PURCHASE & EXCHANGE AGREEMENT

This SECURITIES PURCHASE & EXCHANGE AGREEMENT (this “Agreement”) is entered into as of December 10, 2018 between Richard S. Ressler, an individual or his assignee (“Buyer”), Presbia USA, Inc., a Delaware corporation (“Presbia USA”), and Presbia PLC, an Irish incorporated public limited company (“Presbia PLC” and with Presbia USA, the “Companies” and individually, a “Company” and, together with Buyer, the “Parties” and individually, a “Party”).

RECITALS

A.The amended and restated memorandum and articles of association of Presbia PLC dated 3 August 2017 were filed with the Registrar of Companies in Ireland on September 5, 2017 (the “Constitution”).

B.Presbia PLC has an authorized share capital of US$400,000 and €40,000 divided into 350,000,000 ordinary shares of US$0.001 each (the “Ordinary Shares”), 50,000,000 preferred shares of US$0.001 each (the “Preferred Shares”) and 40,000 deferred ordinary shares of €1.00 each.

C.The amended and restated certificate of incorporation of Presbia USA (the “Certificate”) was filed in the office of the Delaware Secretary of State on April 13, 2018.

D.Presbia USA has 13,000 shares of stock authorized in its Certificate divided into 5,000 shares of common stock each with a par value of US$0.01 per share (the “USA Common Stock”) and 8,000 shares of Preferred Stock each with a par value of US$0.01 per share (the “USA Old Preferred Shares”).  

E.The parties acknowledge that Buyer and/or his affiliates own approximately 60% of the issued and outstanding shares of the Ordinary Shares of Presbia PLC.  Presbia PLC owns directly (following completion of the corporate reorganization implemented pursuant to the Share Exchange and Contribution Agreement attached as Exhibit F hereto pursuant to Section 2.2(h) hereof) all of the issued and outstanding shares of USA Common Stock.  Pursuant to the Stock Purchase Agreement dated April 12, 2018, (i) Buyer had purchased, and Presbia PLC had issued to Buyer, an aggregate of 100 shares of Preferred Stock of Presbia PLC (the “PLC Old Preferred Shares”) for aggregate proceeds of US$100,000 (the “PLC Old Preferred Shares 

 

 

 

Proceeds”), and (ii) Buyer had purchased, and Presbia USA had issued to Buyer, an aggregate of 4,900 USA Old Preferred Shares.

F.Buyer desires to invest in (i) Presbia USA by providing a US$3,500,000 secured loan to Presbia USA, (ii) Presbia PLC by purchasing 100 newly-designated Preferred Shares in Presbia PLC (as such newly-designated Preferred Shares are authorized pursuant to the Subscription Letter in the manner described in this Agreement, the “PLC New Preferred Shares”), with the proceeds of the PLC New Preferred Shares being applied to redeem and cancel all 100 of the PLC Old Preferred Shares, (iii) Presbia PLC by acquiring warrants to purchase Ordinary Shares of Presbia PLC, and (iv) Presbia USA by exchanging all 4,900 of Buyer’s USA Old Preferred Shares for 5,239 shares of a newly-designated class of preferred shares in Presbia USA (as such newly-designated preferred shares are authorized pursuant to the Restated Certificate in the manner described in this Agreement, the “USA New Preferred Shares”), on the terms and conditions set forth in this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants, agreements, representations and warranties herein contained, the Parties hereby agree as follows:

AGREEMENT

1.LOAN, SECURITIES TRANSACTIONS & CLOSING.

1.1Presbia USA Loan; Share Purchases, Redemptions & Exchanges; Warrants.

1.1.1Presbia USA Loan.  Upon and subject to the terms and conditions set forth in this Agreement, at the Closing (as hereinafter defined), Buyer shall provide and fund to Presbia USA a secured loan in the principal amount of US$3,500,000 (the “Presbia USA Loan”), on the terms set out in the loan agreement (the “Loan Agreement”) to be entered into by Buyer and Presbia USA in the form of Exhibit A.

1.1.2Presbia PLC Shares.  Upon and subject to the terms and conditions set forth in this Agreement, at the Closing, Buyer shall also subscribe for and Presbia PLC shall allot and issue to Buyer, for aggregate proceeds of US$100,000 (the “PLC New Preferred Shares Proceeds”), 100 PLC New Preferred Shares of Presbia PLC with the rights set out in the subscription letter (the “Subscription Letter”) to be entered into by Buyer and Presbia PLC in the form of Exhibit B.  Buyer consents to its name being entered in the register of members of Presbia PLC in respect of the PLC New Preferred Shares to be subscribed by it (or its nominee) and agrees that it will take such shares with the benefit of the rights and subject to the restrictions set out in the Subscription Letter and/or Constitution.  Upon the effectiveness of the Closing, without any further action by any Party, all of the PLC Old Preferred Shares shall be redeemed out of the proceeds of the PLC New Preferred Shares Proceeds, for an amount equal to the PLC Old Preferred Shares Proceeds (being the “PLC Redemption Price”), and cancelled in accordance with the terms of issue of the PLC Old Preferred Shares, the Constitution and sections 105(2)(b) and 106 of the Companies Act of Ireland, as amended.  Buyer agrees that the PLC Redemption Price represents satisfaction in full of all obligations of Presbia PLC in respect of the PLC Old Preferred Shares, and waives compliance with any notice or other procedures specified 

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in the instruments governing the PLC Old Preferred Shares or otherwise in connection with such redemption and cancellation.

1.1.3Presbia PLC Warrants.  Presbia PLC shall also, at the Closing, issue to Buyer warrants in the form of Exhibit C attached hereto (the “Warrants”) to purchase 14,731,667 Ordinary Shares of Presbia PLC (the “Warrant Shares”), at a price of US$0.60 per Ordinary Share.

1.1.4Presbia USA Preferred Stock.  Upon and subject to the terms and conditions set forth in this Agreement, effective as of the Closing, Buyer shall exchange all 4,900 of the USA Old Preferred Shares for 5,239 USA New Preferred Shares with the rights set out in the amended and restated certificate of incorporation to be executed by Presbia USA and filed in the office of the Delaware Secretary of State (the “Restated Certificate”) in the form of Exhibit D attached hereto.  Buyer consents to its name being entered in the stock registry of Presbia USA in respect of the USA New Preferred Shares to be subscribed by it (or its nominee) and agrees that it will take such shares with the benefit of the rights and subject to the restrictions set out in the Restated Certificate.  Upon the effectiveness of the Closing, without any further action by any Party, the USA Old Preferred Shares shall be exchanged for (and automatically converted into) the USA New Preferred Shares and the designations for the USA Old Preferred Shares shall be eliminated from the Certificate, as provided in the Restated Certificate. Buyer agrees that the delivery of the USA New Preferred Shares pursuant to this Section 1.1.4 (in exchange for the USA Old Preferred Shares, which are being surrendered and cancelled pursuant to this Agreement) represents satisfaction in full of all obligations of Presbia USA in respect of the USA Old Preferred Shares, and Buyer unconditionally and irrevocably waives any and all rights, claims or interests in respect of the USA Old Preferred Shares so exchanged, surrendered and cancelled, whether arising from the Certificate or otherwise.

1.2Flow of Funds.  The aggregate cash amount to be paid by Buyer at Closing hereunder consists of US$3,500,000 representing the funding of the principal amount of the Presbia USA Loan (the “Presbia USA Loan Amount”).  Buyer shall pay to Presbia USA the Presbia USA Loan Amount at the Closing on the Closing Date in immediately available funds.  The US$100,000 purchase price to be paid by Buyer to purchase the PLC New Preferred Shares shall be set off against the US$100,000 to be paid by Presbia PLC in respect of the redemption and cancellation of the PLC Old Preferred Shares.  In connection with Buyer’s surrender of his USA Old Preferred Shares to Presbia USA in exchange for the USA New Preferred Shares, no additional cash payment or other consideration shall be required in respect of such exchange.  No additional cash payment or other consideration shall be required with respect to issuance of the Warrants. 

1.3Conversion Mechanism.  To the extent permitted by applicable law (including laws in respect of creditors’ rights), Buyer shall have the option to convert all or part of the accrued value of the USA New Preferred Shares into a secured loan to Presbia USA on terms substantially similar to the Presbia USA Loan issued pursuant to Section 1.1.1 of this Agreement.  The accrued value of such USA New Preferred Shares shall be equal to the sum of the Original Issue Price (as defined in the Restated Certificate) paid for such shares and the accrued but unpaid dividend on such shares that would be payable if a Liquidation Event (as defined in the Restated Certificate) had occurred and the proceeds distributed to Buyer as of the date of the conversion pursuant to this Section 1.3.

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2.CLOSING.

2.1Closing.  The consummation of the funding of the Presbia USA Loan, the purchase and sale of the PLC New Preferred Shares, the redemption and cancellation of the PLC Old Preferred Shares, the exchange of the USA Old Preferred Shares for the USA New Preferred Shares, and the issuance of the Warrants, in each case as provided for in this Agreement (the “Closing”), shall take place at the offices of Buyer at 1:00 p.m. on the date hereof, or at such other place, time or date as the Parties may agree (the “Closing Date”).  The PLC New Preferred Shares and the USA New Preferred Shares are sometimes referred to as the “Shares.” For this, and all other purposes of this Agreement, time shall be considered of the essence.

2.2Closing Deliveries.  At the Closing:

2.2.1Presbia PLC and/or Presbia USA, as applicable, shall deliver, or cause to be delivered, to Buyer the following documents (each, a “Company’s Closing Document”):

(a)the Loan Agreement in respect of the Presbia USA Loan executed by Presbia USA;

(b)the security documents including a Guaranty (the “Loan Guaranty”) in respect of the Presbia USA Loan in such form as mutually agreed between the Parties (collectively, including the Loan Guaranty, the “Security Documents”), executed by the party or parties thereto;

(c)a share certificate executed by Presbia PLC in the name of Buyer in respect of the PLC New Preferred Shares;

(d)a share certificate executed by Presbia USA in the name of Buyer in respect of the USA New Preferred Shares;

(e)the Restated Certificate, fully executed and ready for filing with the Delaware Secretary of State;

(f)the Warrants;

(g)a guaranty in respect of the USA New Preferred Shares in the form of Exhibit E (the “Preferred Stock Guaranty”), fully executed by Presbia PLC;

(h)the Share Exchange and Contribution Agreement in the form of Exhibit F (the “Share Exchange and Contribution Agreement”), executed by each of Presbia PLC, Presbia Ireland, Limited and Presbia USA; 

(i)a certificate executed by the secretary of Presbia PLC containing a resolution of Presbia PLC’s board of directors authorizing the execution of this Agreement and all instruments to be executed by Presbia PLC in connection with the transactions 

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contemplated by this Agreement and confirming the names of all officers and directors of Presbia PLC; 

(j)a certificate executed by the secretary of Presbia USA containing a resolution of Presbia USA’s board of directors authorizing the execution of this Agreement and all instruments to be executed by Presbia USA in connection with the transactions contemplated by this Agreement and confirming the names of all officers and directors of Presbia USA; 

(k)a letter of status in respect of Presbia PLC from the Irish Companies Registration Office dated as of a date within thirty (30) days of the Closing Date; and

(l)a certificate of good standing of Presbia USA issued by the Delaware Secretary of State no more than thirty (30) days prior to the Closing.

2.2.2Presbia USA shall deliver, or cause to be delivered, to Buyer the following documents (collectively, the “Company’s Closing Documents”):

2.2.3Buyer shall deliver or cause to be delivered to the Companies the following deliveries and documents (collectively, the “Buyer’s Closing Documents”):

(a)the Presbia USA Loan Amount by wire transfer of immediately available funds to the account specified by Presbia USA; 

(b)the Loan Agreement and the Security Documents executed by Buyer;

(c)the certificates representing the PLC Old Preferred Shares and the USA Old Preferred Shares (to the extent, in each case, certificates were previously issued in respect of such shares), in each case duly endorsed and accompanied by such other duly executed documents as requested by the Companies in connection with the redemption (in the case of the PLC Old Preferred Shares) or exchange (in the case of the USA Old Preferred Shares) and cancellation of such shares; and

(d)a certificate executed by the Secretary or other authorized officer of Buyer certifying the accuracy of the respective representations and warranties of Buyer herein at and as of the Closing Date and that Buyer has performed and complied with all covenants and conditions required to be performed or complied with hereunder prior to or at the Closing.

2.2.4Each of the Parties shall take any and all further lawful actions and deliver to the other or file such other documents, instruments, certificates, and opinions as may be required by this Agreement or applicable law or as otherwise necessary to consummate the transactions contemplated by this Agreement (collectively, the “Transactions”).

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3.REPRESENTATIONS AND WARRANTIES OF PRESBIA PLC.  The Companies hereby jointly and severally represent and warrant to Buyer as of the date hereof:

3.1Incorporation and Existence.

3.1.1Presbia PLC is a company duly incorporated and validly existing under the laws of Ireland.  Presbia PLC has the legal right and full power and authority to carry on its business and activities as currently being carried on.

3.1.2Presbia PLC and each of its subsidiaries (including without limitation Presbia USA) are in good standing (where such concept is recognized in any applicable jurisdiction) as a foreign corporation in all jurisdictions required to carry on such entity’s business, except where the failure to be so qualified or in good standing, as the case may be, could not have or reasonably be expected to result in:  (i) a material adverse effect on the legality, validity or enforceability of this Agreement, (ii) a material adverse effect on the results of operations, assets, business or condition (financial or otherwise) of Presbia PLC and the subsidiaries, taken as a whole, or (iii) a material adverse effect on Presbia PLC’s ability to perform in any material respect on a timely basis its obligations under this Agreement (any of (i), (ii) or (iii), a “Material Adverse Effect”).

3.1.3Presbia PLC has delivered to Buyer a copy of Company’s Constitution, as currently in effect (the “PLC Organizational Documents”).

3.1.4Presbia USA is a company duly incorporated and validly existing under the laws of the state of Delaware and is qualified to do business in the state of California.  Presbia USA has the legal right and full power and authority to carry on its business and activities as currently being carried on.

3.1.5Presbia USA has delivered to Buyer a copy of Company’s Certificate, as currently in effect (the “USA Organizational Documents” and together with the PLC Organizational Documents, the “Organizational Documents”).

3.2Authority; No Conflict.

3.2.1Each of this Agreement and each Company’s Closing Documents constitute the legal, valid and binding obligation of the Companies, enforceable against the Companies in accordance with their terms, except (i) as such enforceability may be limited by general equitable principles and applicable bankruptcy, insolvency, moratorium, fraudulent conveyance laws and other claims affecting creditors generally and (ii) as such enforceability may be limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies.  Each Company has the right, power, authority and capacity to execute and deliver each of this Agreement and such Company’s Closing Documents to which it is a party, and to perform its obligations hereunder and thereunder.  The execution and delivery by each Company of this Agreement and such Company’s Closing Documents, and the consummation of the Transactions have been authorized by all necessary corporate action on the part of such Company.  This Agreement has been duly executed and delivered by the parties thereto (other than Buyer).

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3.2.2Neither the execution and delivery of this Agreement, any of each Company’s Closing Documents, nor the consummation or performance of any of the Transactions by Presbia PLC will, directly or indirectly:

(a)(A) violate or conflict with any provision of the Organizational Documents of either Company; (B) result in (with or without notice or lapse of time) a violation or breach of, or conflict with or constitute a default or result in the termination or in a right of termination or cancellation of, or accelerate the performance required by, or require notice under, any agreement, promissory note, lease, instrument or arrangement to which either Company, or any of the assets of either Company is bound or result in the creation of any liens, mortgages, pledges, deeds of trust, security interests, options, rights of first refusal, charge, encumbrance or other adverse claim or interest of any kind (collectively, the “Liens”) upon either Company or any of the assets of either Company; (C) violate any order, writ, judgment, injunction, ruling, award or decree of any federal, state, local or foreign government, court, arbitrator, administrative agency or commissioner, or other governmental authority or instrumentality (“Governmental Entity”); (D) violate any statute, law or regulation of any jurisdiction as such statute, law or regulation that relates to either Company, or any of the assets of either Company; or (E) result in cancellation, modification, revocation or suspension of any permits, licenses, registrations, consents, approvals, authorizations or certificates issued or granted by any Governmental Entity which are held by or granted to either Company or which are necessary for the conduct of the Business, except in the case of each of clauses (B), (C), (D) and (E), such as could not have or reasonably be expected to result in a Material Adverse Effect.; or

(b)Neither Company is required to give any notice to or obtain any approval, consent, ratification, waiver or other authorization from any person or entity (including, without limitation, any Governmental Entity) in connection with (i) the execution and delivery of this Agreement or any of each Company’s Closing Documents, or (ii) the consummation or performance of any of the Transactions, other than:  (i) application(s) to the applicable trading market for the listing of the Warrant Shares for trading thereon in the time and manner required thereby, and (ii) such filings as are required to be made under applicable state securities laws (collectively, the “Required Approvals”).

3.3Known Liabilities.  Except as disclosed in Presbia PLC’s filings with SEC or as otherwise disclosed in writing to Buyer, neither Company has any material liabilities, whether asserted or unasserted, whether absolute or contingent, whether accrued or unaccrued, whether liquidated or unliquidated, whether due or to become due (“Liabilities”).

3.4Books and Records.  The General Ledger for the calendar years 2016 and 2017, and the minute books and statutory books of each Company, all of which have been made available to Buyer, are complete as to all material items, and no meeting of any shareholders, board of directors, or committee has been held for which minutes have not been prepared and are not contained in such minute books.

3.5Title to Properties; Liens.  Neither Company owns any fee interest in any real property, facility, building, plant, factory, office warehouse or other real property or improvement (collectively, “Real Property”).

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3.6Orders; Legal Proceedings.  Except as may have been disclosed in writing to Buyer, there are no outstanding orders, judgments, injunctions, writs, consents, awards, decrees or other judicial mandates of any Governmental entity against or involving either Company.

3.7Taxes.  Except for matters that would not, individually or in the aggregate, have or reasonably be expected to result in a Material Adverse Effect, each Company has duly filed all tax reports and returns required to be filed by it and has duly paid all taxes and other charges due or claimed to be due from it by federal, state, local or foreign taxing authorities (including, without limitation, those due in respect of the properties, income, franchises, licenses, sales or payrolls of such Company) (“Taxes”), or if not, the reserves, if any, for Taxes reflected in the Closing Date Balance Sheet are adequate to cover such unpaid Taxes.  All tax returns filed by each Company are true, correct and complete in all material respects.  All taxes that each Company is or was required by law to withhold or collect have been duly withheld or collected and, to the extent required, have been paid to the proper governmental body or other person.  There is no claim, audit, action, suit, proceeding or investigation with respect to taxes in any material amount due or claimed to be due from each Company or any tax return filed or required to be filed by either Company pending or threatened against or with respect to such Company.

3.8Employee Benefits.  Except as disclosed in Presbia PLC’s filings with the SEC or in writing to Buyer, each Company does not have and none of its current or former employees are covered by, any bonus, deferred compensation, pension, profit-sharing, retirement, insurance, stock purchase, stock option or any other fringe benefit plan, arrangement or practice, other than standard health benefits, or any other employee benefit plan, as defined in section 3(3) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), whether formal or informal.  Neither Company has any commitment to create any retirement, pension or compensation plan, arrangement or practice.  The requirements of section 4980B of the Internal Revenue Code of 1986, as amended (the “Code”), and Part 6 of Subtitle B of Title I of ERISA have been satisfied with respect to each Company Plan.

3.9Change of Control Payments.  Neither the execution and delivery of this Agreement or any of each Company’s Closing Documents nor the consummation of the Transactions will result in any payment (including, without limitation, severance, unemployment compensation, golden parachute, bonus or otherwise) becoming due to any officer, director, independent contractor, consultant, agent or employee of either Company.

3.10Litigation.  Except as otherwise disclosed in writing to Buyer, there is no suit, action or proceeding pending, threatened or appealable against either Company before any court, arbitrator, or before any governmental department, commission, board, agency, or instrumentality that could reasonably be expected to have a material adverse effect, and neither Company has received any written notice that any such suit, action or proceeding is threatened.  Neither Company is subject to any judgment, order or decree of any court, arbitrator, or Governmental Entity.

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3.11Intellectual Property.

3.11.1Each Company has provided to Buyer access to or copies of a true and complete list of (i) all Intellectual Property Rights that are registered, filed, or issued under the authority of any Governmental Entity, including all patents, registrations for trade names, logos, trademarks, or service marks, registrations for copyright, internet domain names, and all applications of the foregoing, in which either Company has or purports to have an ownership interest of any nature (whether exclusively, jointly with another Person, or otherwise) (collectively herein, “Registered IP”); (ii) the jurisdiction in which such item of Registered IP has been registered or filed and the applicable registration or serial number; and (iii) any other Person that has an ownership interest in such item of Registered IP and the nature of such ownership interest.  True and complete copies of all applications, and all correspondence to and from the relevant Governmental Entity and each Company in the possession of each Company that, to the Knowledge or each Company, materially and adversely affect the scope, registerability or validity of the subject Registered IP, and official actions taken by the relevant Governmental Entity related to each such item of Registered IP have been made available to Buyer.

3.11.2Copies of written agreements in the possession of either Company pursuant to which software, technology, content, patents, trademarks, or other materials (other than off‐the‐shelf software), that are licensed to either Company and are material to the business of either Company have been made available to Buyer.

3.11.3Neither Company is bound by, and no Company IP is subject to, any contract containing any covenant or other provision that in any way limits or restricts the ability of either Company to use, exploit, assert, or enforce any Company IP anywhere in the world.

3.11.4The Companies and, to the Companies’ Knowledge, all third parties are in compliance in all material respects with each contract involving Intellectual Property Rights.  No event has occurred which with notice or lapse of time would constitute a material breach or default or permit termination, modification or acceleration under any such contract.

(a)Each Company exclusively owns all right, title, and interest to and in such Company’s IP (other than Intellectual Property Rights exclusively licensed to such Company, free and clear of any Liens (other than Permitted Liens).

(b)To either Company’s Knowledge (limited to the knowledge of the chief executive officer and vice presidents of each Company), no Person is currently infringing, misappropriating, or otherwise violating, in any material respect any of its IP.  To each Company’s Knowledge, there is no pending actual, alleged, or suspected infringement or misappropriation of any of its Company IP.

(c)Neither Company has infringed or misappropriated and is not currently infringing (directly, contributorily, by inducement, or otherwise) or misappropriating any Intellectual Property Right of any other Person in any material respect.

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(d)As used herein:

“Intellectual Property” means and includes all algorithms, apparatus, databases and data collections, diagrams, inventions (whether or not patentable), know-how, logos, marks (including brand names, product names, logos, and slogans), methods, network configurations and architectures, processes, proprietary information (including Customer Lists, financial data, marketing strategies, and product development roadmaps), protocols, schematics, specifications, software, software code (in any form including source code and executable or object code), subroutines, user interfaces, techniques, URLs, web sites, works of authorship, and other forms of technology (whether or not embodied in any tangible form and including all tangible embodiments of the foregoing such as instruction manuals, laboratory notebooks, prototypes, samples, studies, and summaries).

“Intellectual Property Rights” means and includes all rights of the following types, which may exist or be created under the laws of any jurisdiction in the world:  (a) rights associated with original works of authorship (including software in any form, including source code and executable or object code), including copyrights and moral rights; (b) trademark and trade name rights, domain name rights and similar rights; (c) trade secret rights, including any trade secret rights with respect to algorithms, inventions (whether or not patentable), know-how, methods, processes, proprietary information (including Customer Lists, financial data, marketing strategies, and product development roadmaps), protocols, schematics, specifications, software, and techniques; (d) patents and similar industrial property rights; (e) other proprietary rights of every kind and nature (including proprietary rights in databases, and data collections); and (f) all registrations, renewals, extensions, combinations, divisions, or reissues of, and applications for, any of the rights referred to in clauses (a) through (f) above.

4.REPRESENTATIONS AND WARRANTIES OF BUYER.

Buyer hereby represents and warrants to the Companies as follows:

4.1Organization and Good Standing.  Buyer is a corporation duly organized, validly existing and in good standing under the laws of the State of California, its state of formation.  Buyer has full corporate power and authority to own and operate its properties and assets and to conduct its business as now conducted.

4.2Authority; No Conflict.

4.2.1Each of this Agreement and Buyer’s Closing Documents constitutes the legal, valid and binding obligation of Buyer (to the extent Buyer is a party thereto), enforceable against it in accordance with its terms.  Buyer has the absolute and unrestricted right, power, and authority to execute and deliver each of this Agreement and Buyer’s Closing Documents to which it is a party and to perform its obligations hereunder and thereunder.  The execution and delivery of this Agreement and Buyer’s Closing Documents (to the extent Buyer is a party thereto), and the consummation and performance of the Transactions (to the extent 

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applicable to Buyer), has been authorized by all necessary corporate action on the part of Buyer.  This Agreement and the Buyer’s Closing Documents (on the Closing Date) have been duly executed and delivered by Buyer (to the extent Buyer is a party thereto).

4.2.2Neither the execution and delivery of this Agreement or any of the Buyer’s Closing Documents by Buyer, nor the consummation or performance of any of the Transactions by Buyer, will, directly or indirectly, give any person or entity the right to prevent, delay or otherwise interfere with any of the Transactions pursuant to:  (i) any provision of Buyer’s Organizational Documents; (ii) any resolution adopted by the board of directors (or other governing body) or the stockholders of Buyer; (iii) any applicable law, statute, ordinance, rule or regulation of any jurisdiction; (iv) any order, writ, judgment, injunction, ruling, award or decree of any Governmental Entity; or (v) any agreement, arrangement or understanding to which Buyer is a party or by which Buyer may be bound.  Buyer is not required to give any notice to or obtain any consent from any person or entity in connection with the execution and delivery of this Agreement or the Buyer’s Closing Documents or the consummation or performance of any of the Transactions.

4.3Investment Intent.  Buyer is purchasing the Shares for Buyer’s own account and not with a view to or for sale in connection with any distribution of the Shares.

4.4Accredited Investor Status.  At the time Buyer was offered the Shares and Warrants, it was, and as of the date hereof it is, and on each date on which it exercises any Warrants, it will be an “accredited investor” as defined in Rule 501(a) (1), (a)(2), (a)(3), (a)(7) or (a)(8) under the Securities Act.

4.5Access to Information.  Buyer acknowledges that it has had the opportunity to review the Agreement (including all exhibits and schedules thereto) and the SEC Reports and has been afforded, (i) the opportunity to ask such questions as it has deemed necessary of, and to receive answers from, representatives of the Companies concerning the terms and conditions of the offering of the Securities and the merits and risks of investing in the Securities; (ii) access to information about the Companies and their financial condition, results of operations, business, properties, management and prospects sufficient to enable it to evaluate its investment; and (iii) the opportunity to obtain such additional information that the Companies possess or can acquire without unreasonable effort or expense that is necessary to make an informed investment decision with respect to the investment.

5.SURVIVAL OF REPRESENTATIONS AND WARRANTIES.  All representations and warranties in this Agreement shall survive the Closing Date.  The right to indemnification, reimbursement or other remedy based on such representations and warranties will not be affected by any investigation conducted by the Parties.

6.COVENANTS.  As covenants that will survive the Closing;

6.1Actions Requiring Buyer Consent.  Save where in the case of PLC the taking of such action is determined by or within the control of its shareholders, and subject to applicable law, each Company covenants that in respect of itself it shall not, without first obtaining Buyer’s approval (by vote or written consent as provided by law):

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6.1.1effect any alteration, repeal, change or amendment of the rights, privileges or preferences of the Shares in a manner that adversely affects the rights, privileges or preferences of the Shares or any series thereof;

6.1.2amend, modify or repeal any provision of the Constitution or the Restated Certificate or bylaws in a manner that adversely affects the powers, preferences or rights of the Shares;

6.1.3agree to any debt financing in an amount in excess of US$8,000,000;

6.1.4execute any guaranty:

6.1.5consent to any merger or dissolution of either Company;

6.1.6settle any lawsuit or civil investigation requiring the payment of more than US$1,000,000; or

6.1.7execute any document or enter into any arrangement that has a potential liability to the Company in excess of US$1,000,000.

6.2Affirmative Covenants.  The Companies shall, jointly and severally, cause compliance with all terms of the Shares, including all payment obligations regarding dividends, liquidation preferences and redemption.

7.GENERAL PROVISIONS.

7.1Expenses.  Presbia PLC shall pay all costs and expenses incurred or to be incurred by it in negotiating and preparing this Agreement (and other agreements and documents referred to herein) and in closing and in carrying out the Transactions.  If any legal action or other proceeding is brought for the enforcement of this Agreement, or because of an alleged dispute, breach, default, or misrepresentation in connection with any of the provisions of this Agreement, or because of a Party’s involvement in a bankruptcy proceeding, the successful or prevailing party or parties shall, subject to applicable law, be entitled to recover reasonable attorneys’ fees and other costs incurred in that action or proceeding, in addition to any other relief to which it or they might be entitled.

7.2Notices.  All notices, consents, waivers, and other communications under this Agreement must be in writing and will be deemed to have been duly given (a) when delivered by hand, (b) when sent by facsimile, provided there is an electronic printed confirmation of transmission and a copy is mailed by U.S. certified mail or other similar non-U.S. mail service, return receipt requested; (c) three days after being sent by Certified U.S. Mail, return receipt requested, or (d) one day after deposit with a nationally recognized overnight delivery service, in each case to the appropriate addresses and facsimile numbers set forth below (or to such other addresses and facsimile numbers as a Party may designate by notice to the other Parties):

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Presbia PLC or USA:
	
Presbia PLC
8845 Irvine Center Drive
Suite 100
Irvine, CA 92618
Attn:  Mark Yung

Presbia USA, Inc.
8845 Irvine Center Drive
Suite 100
Irvine, CA 92618
Attn:  Mark Yung

With Copy to:

Lowenstein Sandler LLP
One Lowenstein Drive
Roseland New Jersey 07068
Attn:  David L. Goret

	
Buyer:
	
Richard Ressler
c/o Orchard Capital Corporation
4700 Wilshire Blvd.
Los Angeles, CA 90010

With a copy to:

Fragner Seifert Pace & Winograd LLP
601 South Figueroa Street, Suite 2320
Los Angeles, CA 90017
Attention:  Matthew C. Fragner

7.3Waiver.  The rights and remedies of the Parties to this Agreement are cumulative and not alternative and shall be in addition to every other remedy given hereunder, under any of the agreements referred to herein or now or hereafter existing at law or in equity or by statute or otherwise.  Neither the failure nor any delay by any Party in exercising any right, power, or privilege under this Agreement or any of the agreements and documents referred to in this Agreement will operate as a waiver of such right, power, or privilege, and no single or partial exercise of any such right, power, or privilege will preclude any other or further exercise of such right, power, or privilege or the exercise of any other right, power, or privilege.

7.4Entire Agreement and Modification.  This Agreement supersedes all prior oral or written agreements between the Parties with respect to its subject matter and constitutes (along with the agreements and documents referred to in this Agreement) a complete and exclusive statement of the terms of the agreement between the Parties with respect to its subject matter.  This Agreement may not be amended except by a written agreement executed by the Party to be charged with the amendment.

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7.5Assignments, Successors, and No Third-Party Rights.  None of the Parties may assign any of its rights under this Agreement without the prior consent of the other Parties, provided that Buyer may assign all or any of its rights hereunder to an affiliated party.  Subject to the preceding sentence, this Agreement will apply to, be binding in all respects upon, and inure to the benefit of the successors and permitted assigns of the Parties.  Nothing expressed or referred to in this Agreement will be construed to give any person or entity other than the Parties to this Agreement any legal or equitable right, remedy, or claim under or with respect to this Agreement or any provision of this Agreement.

7.6Severability.  If any provision of this Agreement is held invalid or unenforceable by any court of competent jurisdiction, the other provisions of this Agreement will remain in full force and effect.  Any provision of this Agreement held invalid or unenforceable only in part or degree will remain in full force and effect to the extent not held invalid or unenforceable.

7.7Section Headings, Construction.  The headings of Sections in this Agreement are provided for convenience only and will not affect its construction or interpretation.  All references herein to sections, paragraphs and exhibits shall, unless otherwise expressly stated, mean sections and paragraphs in, and exhibits attached to, this Agreement.  All words used in this Agreement will be construed to be of such gender or number as the circumstances require.  Unless otherwise expressly provided, the word “including” does not limit the preceding words or terms.

7.8Confidentiality of Agreements.  The Parties shall keep the terms of this Agreement and the other agreements contemplated by this Agreement confidential and will not, without the prior written consent of the other Parties or as required in any judicial proceeding, disclose such terms to any person or entity other than their accountants and attorneys who agree to be bound by this confidentiality provision; provided, however, that the foregoing confidentiality obligation will terminate with respect to any information that becomes generally available to the public through no fault of any of the Parties or their respective representatives, accountants or attorneys.

7.9Governing Law; Venue; Jurisdiction.  This Agreement will be governed by and construed under the laws of the California without regard to conflicts of laws principles.  Venue for any action relating to the transaction contemplated by this Agreement or the interpretation or enforcement of any of the provisions of this Agreement shall be in Los Angeles County, State of California.  Each of the parties to this Agreement consents of the jurisdiction of the courts of the State of California and agrees that service of process may be affected by delivery of a summons to the agent for service of process on record for such party in the office of the California Secretary of State or, if no such agent is on record, to the address set forth for the party in the notice section of this Agreement.

7.10Attorneys’ Fees.  Subject to Section 8, in the event of any dispute regarding this Agreement, the prevailing party shall be entitled to attorneys’ fees as awarded by the court having jurisdiction.

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7.11Joint and Several Liability.  The obligations of Presbia USA and Presbia PLC shall be joint and several and may be enforced by Buyer against either or both of the Companies under this Agreement.

7.12Counterparts.  This Agreement may be executed in one or more counterparts, each of which will be deemed to be an original copy of this Agreement and all of which, when taken together, will be deemed to constitute one and the same agreement.

7.13No Strict Construction.  The language used in this Agreement will be deemed to be the language chosen by the Parties to express their mutual intent, and no rule of strict construction will be applied against any Party.

7.14Further Assurances.  Each Party agrees that it will without further consideration execute and deliver such other documents and take such other action, whether prior or subsequent to Closing, as may be reasonably requested by another Party to consummate more effectively the purposes or subject matter of this Agreement.

8.Judicial Reference. The parties agree that any dispute or controversy arising out of or relating to this Agreement, or to the interpretation, performance, or breach thereof, shall be heard and decided exclusively by means of a reference pursuant to Section 638 et seq. of the Code of Civil Procedure of the State of California. Such reference shall be made to a retired judge of the Superior Court of the State of California (the “Referee”) who shall hear such dispute or controversy until the final determination thereof pursuant to Article VI, Section 21, of the California Constitution, Section 638 et seq. of the California Code of Civil Procedure, and Rule 244(a) of the California Rules of Court. The term “Referee” as used herein is intended to refer to and include the term “Temporary Judge” as used in the said provisions of the California Constitution and the California Rules of Court.  The Referee shall be selected by mutual agreement of the parties from the list of retired judges maintained by the Superior Court of the State of California for the County of Los Angeles. If the parties are unable to agree upon a retired judge to serve as the Referee, then upon petition by either party to the presiding judge of the Superior Court of the State of California for the County of Los Angeles (or such other judge as the presiding judge may designate for such purpose), such judge shall in his or her sole discretion select the particular retired judge who shall serve as the Referee. The cost of the Referee shall initially be divided equally between the parties, it being understood and agreed that, upon judgment, the prevailing party shall be entitled to reimbursement from the other party of all costs of litigation, including the cost of the Referee.

9.Disclosure and Waiver of Conflict of Interest.  The parties to this Agreement acknowledge that Fragner Seifert Pace & Winograd LLP (“FSPW”) has represented Buyer in connection with the transactions contemplated by this Agreement, and that FSPW has previously represented the Companies and their predecessors in certain real estate and/or corporate matters.  The parties each acknowledge that FSPW’s representation of Buyer without obtaining a waiver of the foregoing conflict of interest would not be permissible under California law, and each party hereby waives such conflict of interest and agrees that FSPW may represent Buyer in connection with this transaction.  In addition, each party consents to any current or future representation by FSPW of Buyer or either or both of the Companies in connection with any matter.  The parties to this Agreement acknowledge that Lowenstein Sandler LLP (“LS”) has represented the Companies in connection with the transactions contemplated by this Agreement, and that LS has previously 

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represented and does represent Buyer and its affiliates in connection with other transactions and/or matters.  The parties each acknowledge that LS’s representation constitutes a conflict of interest and without obtaining a waiver of the foregoing conflict of interest would not be permissible under California law, and each party hereby waives such conflict of interest and agrees that LS may represent the Companies in connection with this transaction and Buyer and its affiliates in connection with other transactions and/or matters.  In addition, each party consents to any current or future representation by LS of Buyer or either or both of the Companies in connection with any matter.

[signatures on next page]

 

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IN WITNESS WHEREOF, the Parties have executed this Securities Purchase & Exchange Agreement as of the date first written above.

	
	
Presbia PLC:

	
PRESBIA PLC
an Irish incorporated public limited company

	
By: /s/ Mark Yung

	
Name: Mark Yung

	
Title: Chief Executive Officer

	
Presbia USA:
Presbia USA, Inc.
a Delaware corporation

	
By: /s/ Mark Yung

	
Name: Mark Yung

	
Title: Chief Executive Officer

	
Buyer:

	
/s/ Richard Ressler

	
Richard Ressler

 

-17-lens-ex102_31.htm

        Exhibit 10.2

 

SECURED PROMISSORY NOTE

 

 

$3,500,000.00                                                                                                                   December 10, 2018

 

FOR VALUE RECEIVED, PRESBIA USA, INC., a Delaware corporation (the “Company”), hereby unconditionally promises to pay to the order of RICHARD RESSLER (the “Holder”) or his respective successors and assigns, having an address at 4700 Wilshire Blvd, Los Angeles, CA 90010, at such address or at such other place as may be designated in writing by the Holder, the aggregate principal sum of THREE MILLION FIVE HUNDRED THOUSAND 00/100 UNITED STATES DOLLARS ($3,500,000.00) or such lesser principal amount of the loans made and not repaid from time to time to the Company by the Holder pursuant to this Note (as shown in the records of the Lender), together with interest from the date set forth above on the unpaid principal balance of this Note in the form and at the rate set forth herein.  

1.Definitions.  Unless the context otherwise requires, when used herein the following terms shall have the meaning indicated:

“Affiliate” shall mean, with respect to any Person, any other Person which directly or indirectly through one or more intermediaries Controls, is controlled by, or is under common control with, such Person.

 

“Business Day” means any day other than a Saturday, Sunday or other day on which commercial banks are authorized or required by law to close in New York City.

 

“Collateral” means, collectivley, the “Collateral” as defined in each of the Security Agreement and the Pledge Agreement, as applicable.

 

“Company” has the meaning set forth in the first paragraph hereof.

 

“Control” (including the terms “controlling”, “controlled by” or “under common control with”) means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise.

 

“Event of Default” has the meaning set forth in Section 6 hereof.

 

“Governmental Authority” means the government of any nation or any political subdivision thereof, whether at the national, state, territorial, provincial, municipal or any other level, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of, or pertaining to, government.

 

“Holder” has the meanings set forth in the first paragraph hereof.

 

“Indebtedness” means any liability or obligation (a) for borrowed money, other than trade payables incurred in the ordinary course of business, (b) evidenced by bonds, debentures, notes, or other similar instruments, (c) in respect of letters of credit or other similar instruments (or reimbursement obligations with respect thereto), except letters of credit or other similar instruments issued to secure 

 

payment of trade payables or obligations in respect of workers’ compensation, unemployment insurance and other social security laws or regulations, all arising in the ordinary course of business consistent with past practices, (d) to pay the deferred purchase price of property or services, except trade payables arising in the ordinary course of business consistent with past practices, (e) as lessee under capitalized leases, and/or (f) secured by a Lien on any asset of the Company, whether or not such obligation is assumed by the Company.

 

“Indemnified Party” has the meaning set forth in Section 17 hereof.

 

“Loan Request” has the meaning set forth in Section 2(a) hereof.

 

“Lien” means any lien, mortgage, deed of trust, pledge, security interest, charge or encumbrance of any kind (including any conditional sale or other title retention agreement, any lease in the nature thereof and any agreement to give any of the foregoing).

 

“Material Adverse Effect” means (a) a material adverse change in, or a material adverse effect upon, the business, properties, assets, operations, liabilities (actual or contingent), or condition (financial or otherwise) of the Company; or (b) a material impairment of the ability of the to perform its obligations under any Transaction Document to which it is a party.

 

“Maturity Date” means the earliest to occur of (a) the fifth (5th) anniversary of the date hereof, (b) such date as may be specified by the Holder in a Termination Notice delivered on or after the second (2nd) anniversary of the date hereof, being a Business Day falling no less than thirty (30) days after the date of the Termination Notice, and (c) any date on which the outstanding loans evidenced by this Note are prepaid in full in accordance with Section 6 hereof.

 

“Note” means this secured promissory note, as amended, supplemented or otherwise modified from time to time.

 

“Person” means an individual, corporation, partnership, limited liability company, trust, business trust, association, joint stock company, joint venture, sole proprietorship, unincorporated organization, governmental authority or any other form of entity not specifically listed herein.

 

“Pledge Agreement” means that certain Pledge Agreement, dated as of the date hereof, made by PRESBIA PLC, a company incorporated in Ireland (registered no. 539137), in favor of the Holder, as the same may be amended, supplemented or otherwise modified from time to time.

 

“Related Parties” with respect to any Person, means such Person’s Affiliates and the directors, officers, employees, partners, agents, trustees, administrators, managers, advisors and representatives of it and its Affiliates.

 

“Security Agreement” means that certain Security and Pledge Agreement, dated as of the date hereof, by and between the Company and the Holder, as the same may be amended, supplemented or otherwise modified from time to time.

 

“Security Documents” means the collective reference to the Security Agreement, the Pledge Agreement and each other agreement or writing entered in to in addition to this Note pursuant to which the Company purports to pledge or grant a security interest in any property or assets securing the Company’s obligations hereunder or any Person pledges or grants a security interest in any property or assets securing the Company’s obligations hereunder or purports to guaranty the payment and/or 

-2-

performance of the Company’s obligations hereunder and, in each case, as amended, restated, supplemented or otherwise modified from time to time.

 

“Subsidiary” of any Person means another Person, an amount of the voting securities, other voting ownership or voting partnership interests of which is sufficient to elect at least a majority of its board of directors or other governing body (or, if there are no such voting interests, 50% or more of the equity interests of which) is owned directly or indirectly by such first Person.

 

“Termination Notice” means a notice in writing signed by or on behalf of the Holder addressed to the Company which specifies a date as the Maturity Date for this Note.

“Transaction Documents” means the collective reference to this Note, the Security Documents, and each other agreement or writing entered into between the Company, the Holder and any of their respective Affiliates in respect of this Note, in each case, as amended, restated, supplemented or otherwise modified from time to time.

 

2.Loans, Principal and Interest.

(a)Holder agrees, pursuant to the terms of this Note, upon the request of Company made at any time from and after the date hereof until the Maturity Date, and so long as no Event of Default has occurred and is continuing, to make one or more term loans to Company in an aggregate principal amount up to THREE MILLION FIVE HUNDRED THOUSAND 00/100 UNITED STATES DOLLARS ($3,500,000.00).  Other than in respect of any funding to be made on the date of this Note, the Company shall provide written notice of a term loan draw (each a “Loan Request”) to the Holder at least one (1) Business Day prior to the date that the Company requests that a loan be made hereunder.  The Holder shall have no obligation to fund a loan hereunder during any period where an Event of Default has occurred or is continuing. 

(b)On the date of any loan is made hereunder and upon each payment or prepayment of principal of each Loan, as applicable, the Holder is hereby authorized to record on Schedule A, and any continuation sheets which the Holder may attach hereto, (i) the date of the loans made by the Holder to the Company, (ii) the amount of the principal of the loans made hereunder and (iii) the amount of principal paid or prepaid with respect to any loans made hereunder.  The entries made in such schedule shall be, absent manifest error, prima facie evidence of the existence and amounts of the obligations recorded therein, provided that the failure to so record or any error therein shall not in any manner affect the obligation of the Company to repay the loan evidenced by this Note in accordance with the terms hereof. 

(c)Subject to the other provisions of this Note, the Company shall on the Maturity Date pay to the order of the Holder an amount equal to the aggregate principal amount of this Note then outstanding, plus accrued and unpaid interest thereon, unless and to the extent that this Note is earlier redeemed, exchanged, repurchased or repaid in accordance with the terms of this Note.  

(d)Interest shall accrue on the unpaid principal amount of this Note from the date hereof, or from the most recent Interest Payment Date for which the applicable interest payment has been made, until the principal amount of this Note is paid in full at a rate of ten percent (10.0%) per annum (compounded monthly) and continuing on the outstanding principal until this Note is indefeasibly and irrevocably paid in full by the Company.  Interest shall be payable annually, in arrears, on January 10, 2020 and each annual anniversary of such date (the “Interest Payment Dates”).   Interest on this Note shall be computed on the basis of a 365- or 366-day year for actual days elapsed.  In the event that any amount due hereunder is not paid when due, such overdue amount shall bear interest at an annual rate of twelve percent (12.0%) until paid in full.  In no event shall any interest charged, collected or reserved under this Note exceed the maximum rate then permitted by applicable law until paid in full.  

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(e)Whenever any payment to be made hereunder shall be due on a day that is not a Business Day, such payment shall be made on the next succeeding Business Day and such extension will be taken into account in calculating the amount of interest payable under this Note.  All payments of principal and interest by the Company under this Note shall be made in United States dollars in immediately available funds to the respective account of the Holder as specified by such Holder.  

3.Prepayment.  Upon at least one (1) Business Day’s prior written notice to the Holder, the outstanding principal of this Note and any accrued and unpaid interest may be prepaid, in whole or in part, at any time prior to the Maturity Date without any interest, premium or penalty.  Amounts borrowed under this Note and repaid or prepaid may not be reborrowed.

4.Representations and Warranties.  The Company hereby represents and warrants to the Holder on the date hereof as follows:

(a)The Company is (i) a corporation, validly existing and in good standing under the laws of the State of Delaware and has the requisite corporate power and authority, and the legal right, to own, lease and operate its properties and assets and to conduct its business as it is now being conducted and (ii) in compliance with all laws and orders, except to the extent that the failure to comply therewith could not reasonably be expected to have a Material Adverse Effect.  

 

(b)The Company has the power and authority, and the legal right, to execute and deliver this Note and the other Transaction Documents to which it is a party and to perform its obligations hereunder and thereunder.

 

(c)The execution and delivery of this Note and the other Transaction Documents to which it is a party by the Company and the performance of its obligations hereunder and thereunder have been duly authorized by all necessary corporate action in accordance with all applicable laws. The Company has duly executed and delivered this Note and the other Transaction Documents to which it is a party.

 

(d)Other than any filings which are necessary to perfect any Liens created by the Security Agreement, no consent or authorization of, filing with, notice to or other act by, or in respect of, any Governmental Authority or any other Person is required in order for the Company to execute, deliver, or perform any of its obligations under this Note or the other Transaction Documents to which it is a party, other than consents which have been obtained.

 

(e)The execution and delivery of this Note and the other Transaction Documents to which it is a party and the consummation by the Company of the transactions contemplated hereby and thereby do not and will not (i) violate any provision of the Company’s organizational documents; or (ii) violate any law or order applicable to the Company or by which any of its properties or assets may be bound which could reasonably be expected to have a Material Adverse Effect.

 

(f)Each of this Note and the other Transaction Documents to which it is a party is a valid, legal and binding obligation of the Company, enforceable against the Company in accordance with its terms except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights generally and by general equitable principles (whether enforcement is sought by proceedings in equity or at law).

 

(g)No action, suit, litigation, investigation or proceeding of, or before, any arbitrator or Governmental Authority is pending or, to the knowledge of the Company, threatened by or against the Company or any of its property or assets (i) with respect to this Note or the other Transaction Documents to which it is a party or any of the transactions contemplated hereby or thereby or (ii) that could be expected 

-4-

to materially adversely affect the Company’s financial condition or the ability of the Company to perform its obligations under this Note or any other Transaction Document to which it is a party.

 

5.Covenants.  So long as any amount due under this Note is outstanding and until indefeasible payment in full of all amounts payable by the Company hereunder:

(i)The Company shall (A) carry on and conduct its business in substantially the same manner and in substantially the same fields of enterprise as it is presently conducting, (B) do all things necessary to remain duly organized, validly existing, and in good standing as a domestic corporation under the laws of its state of formation and (C) maintain all requisite authority to conduct its business in those jurisdictions in which its business is conducted.

(ii)The Company shall promptly notify the Holder of the occurrence of any Event of Default or any event which, with the giving of notice, the lapse of time or both would constitute an Event of Default, which notice shall include a written statement as to such occurrence, specifying the nature thereof and the action (if any) which is proposed to be taken with respect thereto.

(iii)The Company shall promptly notify the Holder of any default in the performance, observance or fulfillment of any of the obligations, covenants or conditions contained in any agreement or instrument to which the Company is a party which default could reasonably be expected to have a Material Adverse Effect.

(iv)The Company shall pay when due all material taxes, assessments and governmental charges and levies upon it or its income, profits or property, except those that are being contested in good faith by appropriate proceedings and with respect to which adequate reserves have been set aside.

(v)The Company shall comply with all laws, rules, regulations, orders, writs, judgments, injunctions, decrees or awards to which they may be subject, except to the extent that the failure to comply therewith could not reasonably be expected to have a Material Adverse Effect.

(vi)The Company shall not directly or indirectly, engage in any business other than the business engaged in as of the date hereof and any business reasonably related or ancillary thereto.

6.Event of Default.  The occurrence of any of following events shall constitute an “Event of Default” hereunder:

(a)the failure of the Company to make any payment of principal, interest or any other amounts due under this Note or the other Transaction Documents when due, whether at the Maturity Date, upon acceleration or otherwise;

(b)there shall have occurred an acceleration of the stated maturity of any Indebtedness of the Company (other than as evidenced by this Note) of $1,000,000 or more in aggregate principal amount (which acceleration is not rescinded, annulled or otherwise cured within thirty (30) calendar days of receipt by the Company of notice of such acceleration);

(c)the Company makes an assignment for the benefit of creditors or admits in writing its inability to pay its debts generally as they become due; or an order, judgment or decree is entered adjudicating the Company as bankrupt or insolvent; or any order for relief with respect to the Company  is entered under the Federal Bankruptcy Code or any other bankruptcy or insolvency law; or the Company  petitions or applies to any tribunal for the appointment of a custodian, trustee, receiver or liquidator of the Company or of any substantial part of the assets of the Company, or commences any proceeding relating 

-5-

to it under any bankruptcy, reorganization, arrangement, insolvency, readjustment of debt, dissolution or liquidation law of any jurisdiction; or any such petition or application is filed, or any such proceeding is commenced, against the Company  and either (i) the Company  by any act indicates its approval thereof, consents thereto or acquiescence therein or (ii) such petition application or proceeding is not dismissed within sixty (60) days;

(d)a final, non-appealable judgment which, in the aggregate with other outstanding final judgments against the Company, exceeds $1,000,000 (not paid or fully covered by insurance) shall be rendered against the Company  and within sixty (60) days after entry thereof, such judgment is not discharged or execution thereof stayed pending appeal, or within sixty (60) days after the expiration of such stay, such judgment is not discharged; provided, however, that a judgment that provides for the payment of royalties subsequent to the date of the judgment shall be deemed to be discharged so long as the Company  is in compliance with the terms of such judgment;

(e)any representation or warranty made or deemed made by the Company in any of the Transaction Documents (including this Note) shall prove to have been incorrect in any material respect on or as of the date made or deemed made;

(f)any Liens created by this Note or any other Security Document shall at any time not constitute a valid and perfected first priority Lien on the Collateral (to the extent perfection by filing, registration, recordation or possession is required herein or therein) in favor of the Holder, free and clear of all other Liens (other than Liens previously disclosed to the Holder), or any of the security interests granted pursuant to the Security Documents shall be determined to be void, voidable, invalid or unperfected, are subordinated or are ineffective to provide the Holder with a perfected, first priority security interest in the Collateral, free and clear of all other Liens (other than Liens previously disclosed to the Holder) or, except for expiration or termination in accordance with their terms, this Note or any other Security Document shall for whatever reason be terminated or cease to be in full force and effect, or the enforceability thereof or any other Transaction Documents shall be contested by the Company; or

(g)if the Company fails to observe or perform in any material respect any of its covenants contained in the Transaction Documents to which it is a party, and such failure continues for thirty (30) days after receipt by the Company or the applicable Guarantor of notice thereof.

Upon the occurrence of any such Event of Default, all unpaid principal and accrued interest under this Note shall become immediately due and payable (A) upon election the Holder, with respect to (a) through (b) and (d) through (g) of the immediately preceding sentence, and (B) automatically, with respect to (c) of the immediately preceding sentence.  Upon the occurrence of any Event of Default, the Holder may, in addition to declaring all amounts due hereunder to be immediately due and payable, pursue any available remedy, whether at law or in equity, including, without limitation, exercising its rights under the other Transaction Documents.  If an Event of Default shall have occurred and be continuing, the Holder shall have in any jurisdiction in which enforcement hereof is sought, in addition to all other rights and remedies, the rights and remedies of a secured party under the Uniform Commercial Code of the State and any additional rights and remedies as may be provided to a secured party in any jurisdiction in which Collateral is located, including, without limitation, the right to take possession of the Collateral, and for that purpose the Holder may, so far as the Company can give authority therefor, enter upon any premises on which the Collateral may be situated and remove the same therefrom.  Upon the occurrence and during the continuance of an Event of Default, the Holder may in its discretion require the Company to assemble all or any part of the Collateral at such location or locations within the jurisdiction(s) of the Company’s principal office(s) or at such other locations as the Holder may reasonably designate.  Unless the Collateral is perishable or threatens to decline speedily in value or is of a type customarily sold on a recognized market, the Holder shall give to the Company at least ten (10) days’ prior written notice of the time and place of any public sale of Collateral or of the time after which any private sale or any other intended disposition is 

-6-

to be made.  The Company hereby acknowledges that ten (10) days prior written notice of such sale or sales shall be reasonable notice.  In addition, to the extent permitted by applicable law, the Company waives any and all rights that it may have to a judicial hearing in advance of the enforcement of any of the Holder’s rights and remedies hereunder, including, without limitation, its right following an Event of Default to take immediate possession of the Collateral and to exercise its rights and remedies with respect thereto.  

7.Remedies Cumulative. No failure to exercise or delay in exercising any right, remedy, power or privilege hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege. The rights, remedies, powers and privileges herein provided are cumulative and not exclusive of any rights, remedies, powers and privileges provided by law.  To the extent that applicable law imposes duties on the Holder to exercise remedies in a commercially reasonable manner, the Company acknowledges and agrees that it is not commercially unreasonable for the Holder (a) to fail to incur expenses reasonably deemed significant by the Holder to prepare Collateral for disposition or otherwise to fail to complete raw material or work in process into finished goods or other finished products for disposition, (b) to fail to obtain third party consents for access to Collateral to be disposed of, or to obtain or, if not required by other law, to fail to obtain governmental or third party consents for the collection or disposition of Collateral to be collected or disposed of, (c) to fail to exercise collection remedies against account debtors or other persons obligated on Collateral or to fail to remove Liens on or any adverse claims against Collateral, (d) to exercise collection remedies against account debtors and other persons obligated on Collateral directly or through the use of collection agencies and other collection specialists, (e) to advertise dispositions of Collateral through publications or media of general circulation, whether or not the Collateral is of a specialized nature, (f) to contact other persons, whether or not in the same business as the Company, for expressions of interest in acquiring all or any portion of the Collateral, (g) to hire one or more professional auctioneers to assist in the disposition of Collateral, whether or not the collateral is of a specialized nature, (h) to dispose of Collateral by utilizing Internet sites that provide for the auction of assets of the types included in the Collateral or that have the reasonable capability of doing so, or that match buyers and sellers of assets, (i) to dispose of assets in wholesale rather than retail markets, (j) to disclaim disposition warranties, (k) to purchase insurance or credit enhancements to insure the Holder against risks of loss, collection or disposition of Collateral or to provide to the Agent a guaranteed return from the collection or disposition of Collateral, or (l) to the extent deemed appropriate by the Holder, to obtain the services of brokers, investment bankers, consultants and other professionals to assist the Agent in the collection or disposition of any of the Collateral.  The Company acknowledges that the purpose of this Section 7 is to provide non-exhaustive indications of what actions or omissions by the Holder would fulfill the Holder’s duties under the UCC and that other actions or omissions by the Holder shall not be deemed to fail to fulfill such duties solely on account of not being indicated in this Section 7.  Without limitation upon the foregoing, nothing contained in this Section 7 shall be construed to grant any rights to the Company or to impose any duties on the Holder that would not have been granted or imposed by this Note or by applicable law in the absence of this Section 7.

8.Matters Regarding the Holder.

(a)The Company hereby irrevocably appoints the Holder as the Company’s attorney-in-fact, with full authority in the place and stead of the Company and in the name of the Company or otherwise, from time to time following the occurrence of an Event of Default, to take any action and to execute any instrument which the Holder may deem necessary or advisable to accomplish the purposes of this Note, including without limitation to (i) execute any and all documents and instruments and to file financing statements that the Holder deems necessary or useful or desirable to protect, preserve, perfect and/or maintain the perfection and priority of the Holder’s security interest in the Collateral, (ii) endorse the names of the Company on any checks, notes, drafts or other forms of payment or security that may come into the possession of the Holder or any affiliate of the Holder, to sign the Company’s name on invoices or bills-of-lading, drafts against customers, notices of assignment, verifications and schedules, (iii) 

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sell, transfer, pledge, make any arrangement with respect to or otherwise dispose of or deal with any of the Collateral consistent with the UCC (as defined in the Security Agreement) and (iv) do all other acts and things which the Holder deems necessary or useful to protect, preserve or realize upon the Collateral and the Holder’s security interest therein.  The powers granted herein, being coupled with an interest, are irrevocable until all of the obligations hereunder are indefeasibly paid in full and this Note is terminated.  The powers conferred on the Holder hereunder are solely to protect its interests in the Collateral and shall not impose any duty upon it to exercise any such powers.  Neither the Holder nor any attorney-in-fact shall be liable for any act or omission, error in judgment or mistake of law provided the same is not the result of gross negligence or willful misconduct.

(b)For the purpose of enabling the Holder to exercise rights and remedies under this Note and the other Security Documents (including in order to take possession of, collect, receive, assemble, process, appropriate, remove, realize upon, sell or grant options to purchase any Collateral) at such time as the Holder shall be lawfully entitled to exercise such rights and remedies, the Company hereby grants to the Holder, (i) an irrevocable, nonexclusive, worldwide license (exercisable without payment of royalty or other compensation to Company), including in such license the right to sublicense, use and practice any intellectual property now owned or hereafter acquired by Company and access to all media in which any of the licensed items may be recorded or stored and to all software and programs used for the compilation or printout thereof and (ii) an irrevocable license (without payment of rent or other compensation to Company) to use, operate and occupy all real property owned, operated, leased, subleased or otherwise occupied by Company.

(c)If the Company fails to perform any agreement contained herein, the Holder may itself perform, or cause performance of, such agreement and the expenses of the Holder incurred in connection therewith shall be payable by the Company in immediately available funds upon demand by the Holder.

(d)The powers conferred on the Holder hereunder are solely to protect the Holder’s interest in the Collateral and shall not impose any duty upon him to exercise any such powers.  Except for the safe custody of any Collateral in its possession and the accounting for moneys actually received by it hereunder, the Holder shall have no duty as to any Collateral or as to the taking of any necessary steps to preserve rights against prior parties or any other rights pertaining to any Collateral.

 

9.Amendments.  Any amendment or waiver of any term of this Note by any party shall be effective only if in writing and duly signed by the Company and the Holder.

 

10.Waivers.  The Company hereby waives presentment, demand for payment, notice of dishonor, protest and notice of protest, and any or all other notices or demands in connection with the delivery, acceptance, performance, default or endorsement of this Note.  The liability of the Company hereunder shall be unconditional and shall not be in any manner affected by any indulgence whatsoever granted or consented to by the Holder, including but not limited to any extension of time, renewal, waiver or other modification.  Any failure of the Holder to exercise any right hereunder shall not be construed as a waiver of the right to exercise the same or any other right at any time and from time to time thereafter.  The Holder may accept late payments, or partial payments, even though marked “payment in full” or containing words of similar import or other conditions, without waiving any of its rights. 

 

11.Waiver of Jury Trial.  THE COMPANY HEREBY WAIVES ITS RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION ARISING OUT OF OR BASED UPON THIS NOTE OR ANY CONTEMPLATED TRANSACTION, INCLUDING CONTRACT, TORT, 

-8-

BREACH OF DUTY AND ALL OTHER CLAIMS.  THE COMPANY HAS REVIEWED THIS WAIVER WITH ITS COUNSEL.

12.Secured Obligation.  This Note is is secured by a first priority security interest in the Collateral.  This Note grants the Holder certain rights with respect to such Collateral upon an Event of Default.

13.Governing Law; Consent to Jurisdiction.  This Note shall be governed by and construed under the law of the State of California, without giving effect to the conflicts of law principles thereof.  The Company and, by accepting this Note, the Holder, each irrevocably submits to the exclusive jurisdiction of the courts of the State of California located in Los Angeles County and the United States District Court for the Central District of Los Angeles for the purpose of any suit, action, proceeding or judgment relating to or arising out of this Note and the transactions contemplated hereby.  Service of process in connection with any such suit, action or proceeding may be served on each party hereto anywhere in the world by the same methods as are specified for the giving of notices under this Note.  The Company and, by accepting this Note, the Holder, each irrevocably consents to the jurisdiction of any such court in any such suit, action or proceeding and to the laying of venue in such court.  The Company and, by accepting this Note, the Holder, each irrevocably waives any objection to the laying of venue of any such suit, action or proceeding brought in such courts and irrevocably waives any claim that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum.

14.Expenses.  Each party shall bear its own costs and expenses incidental to the negotiation of and to the preparation and carrying into effect of the Transaction Documents and any other documents referred to in the Transaction Documents and all transactions herein provided together with any other documents entered into by the Company and the Holer and the Borrower after the date of this Note.

15.Notices.  Any notice or demand required or permitted to be given or made to or upon any party hereto pursuant to any of the provisions of this Note shall be deemed to have been duly given or made for all purposes if in writing and delivered by hand against receipt, sent by e-mail or facsimile, sent by certified or registered mail, postage prepaid, return receipt requested, to such party at the respective address set forth below or such other address as any party hereto may at any time direct by notice given to the other party in accordance with this Section 15.  The date of giving or making of any such notice or demand shall be (a) if sent by mail by certified or registered mail or sent by hand or overnight courier, the earlier of the date of actual receipt, or five (5) Business Days after such notice or demand is sent, (b) if sent by facsimile, during the recipient’s normal business hours (and if sent after normal business hours shall be deemed to have been given at the opening of the recipient’s business on the next Business Day), and (c) if sent by e-mail, upon the sender’s receipt of an acknowledgment from the intended recipient (such as by the “return receipt requested” function, as available, return e-mail or other written acknowledgment).  Each party’s address for notice is as follows: 

Company:

Presbia USA, Inc.
8845 Irvine Center Drive
Suite 100
Irvine, CA 92618
Attn:  Mark Yung

 

with a copy to:

 

Lowenstein Sandler LLP

One Lowenstein Drive

-9-

Roseland, New Jersey 07068

Attention: David Goret

Email: dgoret@lowenstein.com

 

Holder:

Richard Ressler
c/o Orchard Capital Corporation
4700 Wilshire Blvd.
Los Angeles, CA 90010

With a copy to:

Fragner Seifert Pace & Winograd LLP
601 South Figueroa Street, Suite 2320
Los Angeles, CA 90017
Attention:  Matthew C. Fragner

16.Lost, Stolen or Mutilated Notes.  Upon receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Note, and in case of any such loss, theft or destruction, upon delivery of any customary indemnity agreement reasonably satisfactory to the Company, or in any case of any such mutilation, upon surrender and cancellation of this Note, the Company at its expense will, within five (5) Business Days, issue and deliver a new Note of like tenor in an amount equal to the amount of such lost, stolen or mutilated Note.

17.Indemnification.  The Company agrees to indemnify and hold harmless the Holder and its respective Related Parties (each, an “Indemnified Party”) from and against, any and all claims, damages, losses, liabilities and related expenses (including the reasonable fees, charges and expenses of any counsel for any Indemnified Party), incurred by any Indemnified Party or asserted against any Indemnified Party by any Person (including the Company) other than such Indemnified Party and its Related Parties arising out of, in connection with, or by reason of (a) the execution or delivery of this Note, any other Transaction Document or any agreement or instrument contemplated in connection herewith or therewith, the performance by the parties thereto of their respective obligations hereunder or thereunder or the consummation of the transactions contemplated herewith or therewith; (b) the loans  as evidenced by this Note or the actual or proposed use of the proceeds therefrom; or (c) any actual or prospective claim, investigation, litigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory, whether brought by a third party or by the Company, and regardless of whether any Indemnified Party is a party thereto; provided that, such indemnity shall not be available to any Indemnified Party to the extent that such claims, damages, losses, liabilities or related expenses (x) are determined by a court of competent jurisdiction by final and non-appealable judgment to have resulted from the gross negligence, willful misconduct or fraud of such Indemnified Party or (y) result from a claim brought by the Company against any Indemnified Party for breach of such Indemnified Party’s obligations under this Note, any Transaction Document or any agreement or instrument contemplated in connection herewith or therewith, if a court of competent jurisdiction has rendered a final and non-appealable judgment in favor of the Company on such claim.

18.Rescission of Payments. If at any time any payment made by the Company under this Note is rescinded or must otherwise be restored or returned upon the insolvency, bankruptcy or reorganization of the Company or otherwise, the Company’s obligation to make such payment shall be reinstated as though such payment had not been made.

19.Severability. Whenever possible, each provision of this Note shall be interpreted in such manner as to be effective and valid, but if any provision of this Note is held to be invalid or unenforceable 

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in any respect, such invalidity or unenforceability shall not render invalid or unenforceable any other provision of this Note.

20.Successors and Assigns; Transferability. This Note shall be binding upon and inure to the benefit of the Company and the Holder and their respective permitted successors and assigns. This Note may be assigned or transferred by the Holder to any Person.  The Company may not assign or transfer this Note or any of its rights hereunder without the prior written consent of the Holder and any such assignment shall be null and void.

21.Judicial Reference. The parties agree that any dispute or controversy arising out of or relating to this Note, or to the interpretation, performance, or breach thereof, shall be heard and decided exclusively by means of a reference pursuant to Section 638 et seq. of the Code of Civil Procedure of the State of California. Such reference shall be made to a retired judge of the Superior Court of the State of California (the “Referee”) who shall hear such dispute or controversy until the final determination thereof pursuant to Article VI, Section 21, of the California Constitution, Section 638 et seq. of the California Code of Civil Procedure, and Rule 244(a) of the California Rules of Court. The term “Referee” as used herein is intended to refer to and include the term “Temporary Judge” as used in the said provisions of the California Constitution and the California Rules of Court.  The Referee shall be selected by mutual agreement of the parties from the list of retired judges maintained by the Superior Court of the State of California for the County of Los Angeles. If the parties are unable to agree upon a retired judge to serve as the Referee, then upon petition by either party to the presiding judge of the Superior Court of the State of California for the County of Los Angeles (or such other judge as the presiding judge may designate for such purpose), such judge shall in his or her sole discretion select the particular retired judge who shall serve as the Referee. The cost of the Referee shall initially be divided equally between the parties, it being understood and agreed that, upon judgment, the prevailing party shall be entitled to reimbursement from the other party of all costs of litigation, including the cost of the Referee.

22.Secured Obligation.  This Note is secured by a first priority security interest in the Collateral.  The Security Documents grant the Holder certain rights with respect to such Collateral upon an Event of Default.

 

[signature page follows]

 

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IN WITNESS WHEREOF, the Company has caused this Secured Promissory Note to be signed in its name effective as of the date first above written.

 

		
	
PRESBIA USA, INC.

	
By:
	
/s/ Mark Yung

	
Name:
	
Mark Yung

	
Title:
	
Chief Executive Officer

 

 

 

[Signature Page to Secured Promissory Note]

 

Schedule A

 

				
	
 

Date
	
 

Amount

of loan
	
 

Amount of principal paid or prepaid
	
 

Notation made by

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