InSite Vision Determines that an Unsolicited Offer from a Multi-National Pharmaceutical Company to Acquire InSite for $0.25 in Cash Constitutes a "Company Superior Proposal"

InSite Vision Inc. (OTCBB:INSV) today announced that InSite's Board of Directors determined that the previously announced unsolicited offer from a multi-national pharmaceutical company (the "Bidder") to acquire InSite for $0.25 per share in an all-cash transaction constitutes a "Company Superior Proposal" as defined in InSite's previously announced definitive agreement with QLT Inc. dated as of June 8, 2015, as amended (NASDAQ: QLTI) (TSX: QLT). Under the terms of the QLT merger agreement, QLT would acquire InSite in an all-stock transaction in which shareholders of InSite will receive 0.048 QLT shares for each InSite share they hold. At a special meeting yesterday evening, in good faith and after consultation with its independent financial and legal advisors, the InSite Board of Directors determined that the Bidder's unsolicited offer of $0.25 per share was a Company Superior Proposal as defined in the QLT merger agreement. The Bidder supplemented its proposal with a definitive merger agreement and definitive loan documents that the Bidder has indicated it is prepared to execute upon InSite's termination of the QLT merger agreement. Under the loan documents, the Bidder would lend InSite sufficient funds for InSite to pay off its existing loan from QLT and to operate InSite's business through the end date of the definitive merger agreement. InSite has notified QLT of the InSite Board of Directors' determination, and pursuant to the QLT merger agreement, QLT has the option until 5:00 p.m. PDT, on Wednesday, August 26, 2015 ("Negotiation Period") to negotiate a possible amendment of that agreement to match or exceed the Bidder's offer. InSite is required, and intends to, negotiate in good faith with QLT during the Negotiation Period. InSite is not permitted to enter into the Bidder's merger agreement or to change its recommendation in favor of the QLT transaction unless, at the end of the Negotiation Period, the InSite Board of Directors has determined that the Bidder's offer continues to be a "Company Superior Proposal." The Bidder has stated that its offer will remain outstanding until the expiration of the Negotiation Period and any additional days thereafter necessary for the Bidder and InSite to enter into the definitive agreements provided by the Bidder. Under the QLT merger agreement, InSite would be required to pay a $1,170,000 termination fee to QLT if the InSite Board of Directors terminates the QLT merger agreement in favor of an agreement with the Bidder. The Bidder has agreed to pay the termination fee to QLT on InSite's behalf in such event. InSite would be required to repay the Bidder for the QLT termination fee under certain circumstances in which InSite would be required to pay a termination fee to the Bidder in connection with a termination of the Bidder's merger agreement. At this time, InSite remains subject to the QLT merger agreement and the InSite Board of Directors has not changed its recommendation in support of the QLT transaction, the existing QLT merger agreement, or its recommendation that InSite's stockholders adopt the QLT merger agreement. There can be no assurance that a transaction with the Bidder will result from the Bidder's offer, or that any other transaction will be consummated. There can be no assurance that QLT will seek to negotiate with InSite or will make a revised offer.