OPT Opticare Health

WATERBURY, Conn., Aug. 22 /PRNewswire-FirstCall/ -- OptiCare Health Systems, Inc. (AMEX:OPT) announced today that it has signed a definitive merger agreement with Refac pursuant to which OptiCare will become a wholly owned subsidiary of Refac in a stock-for-stock transaction. Refac and OptiCare are controlled by Palisade Concentrated Equity Partnership, L.P. which beneficially owns 89% of Refac's outstanding common stock and 84% of OptiCare's outstanding common stock on a fully diluted basis. As a condition to the merger, OptiCare's preferred stockholders have agreed to convert all of their preferred stock to common stock prior to the merger. The preferred stockholders will receive approximately 0.0403 shares of Refac common stock for each share of underlying OptiCare common stock and Palisade will receive approximately 0.0403 shares of Refac stock for each share of its OptiCare common stock. Each other share of OptiCare common stock will be converted into 0.0472 shares of Refac common stock. Both Refac's and OptiCare's common stock are listed on the American Stock Exchange ("Amex") and, on August 19, 2005, the closing prices were $6.31 and $0.25, respectively. The transaction was reviewed by a special committee of OptiCare's independent directors. The special committee received an opinion from the Woodward Group, Ltd. that the transaction was fair from a financial point of view to OptiCare's shareholders other than Palisade and Dr. and Mrs. Dean Yimoyines and recommended that the OptiCare board of directors approve the transaction. OptiCare and Refac's boards of directors also approved the transaction. The merger requires the approval of the holders of at least 55% of the outstanding shares of Refac common stock. Palisade, which controls 84% of OptiCare's voting power, has executed a written consent approving the OptiCare merger which consent shall be effective within 20 days after OptiCare mails an information statement to its stockholders. In addition, the merger is subject to other closing conditions and is expected to close in the fourth quarter of 2005. The transaction is expected to qualify as a tax-free reorganization for federal income tax purposes. OptiCare also noted that Refac, in a related transaction, signed a definitive merger agreement with U.S. Vision, Inc. pursuant to which it shall become a wholly owned subsidiary of Refac. U. S. Vision operates 515 retail optical locations in 47 states and Canada, consisting of 504 licensed departments and 11 freestanding stores and is also controlled by Palisade which owns 88% of U.S. Vision's outstanding common stock. Refac estimates that upon completion of both mergers that it will have approximately 18,144,000 shares outstanding and the shares issued in the OptiCare and U.S. Vision mergers will represent approximately 25% and 36%, respectively of Refac's outstanding common stock. Following the mergers, Palisade is expected to remain the controlling stockholder of Refac, with approximately 87% of the outstanding common stock. About OptiCare Health Systems, Inc. OptiCare Health Systems, Inc. is an integrated eye care services company focused on vision benefits management and consumer vision services, including medical, surgical and optometric services and optical retail. CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS This News Release includes certain statements of the Company that may constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and which are made pursuant to the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements concerning the expected closing date of the transaction, the expected consideration OptiCare's stockholders will receive in the transaction, the expected capitalization of Refac after the transactions and the expected tax consequences of the transaction as well as any underlying assumptions and other statements that are not statements of historical fact. When used in this News Release, the words "expects," "anticipates," "estimates," "plans," "intends," "projects," "predicts," "believes," "may" or "should," and similar expressions, are intended to identify forward-looking statements. These forward-looking statements based upon the beliefs of management and assumptions made by and information currently available to the Company. These statements reflect the current view of the Company's management with respect to future events. Many factors could cause the actual results, performance or achievements of the Company to be materially different from any future results, performance, or achievements that may be expressed or implied by such forward-looking statements, including, but not limited to, the companies' inability to satisfy the conditions of the merger and the companies' inability to complete the transactions and successfully integrate the companies. In addition, investors are cautioned that all forward-looking statements involve those risks and uncertainties detailed in the Company's filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K, as amended, for the fiscal year ended December 31, 2004. Forward-looking statements speak only as of the date they are made and the Company undertakes no duty or obligation to update any forward-looking statements in light of new information or future events. ADDITIONAL INFORMATION AND WHERE TO FIND IT In connection with the proposed transaction with OptiCare, Refac will file a registration statement with a prospectus, which also will contain an information statement of OptiCare, with the SEC. Investors and security holders are URGED to read the prospectus and information statement carefully when they become available before making any investment decision, because they will contain important information. Investors and security holders may obtain free copies of the prospectus and information statement, once available, and other documents filed by Refac and OptiCare with the SEC, at the SEC's web site at http://www.sec.gov/. Free copies of the prospectus and information statement, once available, and other filings made by OptiCare with the SEC, may also be obtained from OptiCare by directing a request to OptiCare Health Systems, Inc., 87 Grandview Avenue, Waterbury, Connecticut 06708, Attention: Investor Relations. Free copies of the prospectus and information statement, once available, and other filings made by Refac with the SEC, may also be obtained from Refac by directing a request to Refac, One Bridge Plaza, Suite 605, Fort Lee, New Jersey 07024., Attention: Investor Relations. DATASOURCE: OptiCare Health Systems, Inc. CONTACT: Vincent S. Miceli, Corporate Controller of OptiCare Health Systems, Inc., +1-203-596-2236

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