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                                                                    EXHIBIT 10.2

                         AGREEMENT OF PURCHASE AND SALE

                            DATED AS OF APRIL 7, 2003

                                      AMONG

                         AMERICAN MEDICAL SYSTEMS, INC.,

                                 ENDOCARE, INC.

                                       AND

                         TIMM MEDICAL TECHNOLOGIES, INC.
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      THIS AGREEMENT OF PURCHASE AND SALE is entered into as of April 7, 2003,
by and among American Medical Systems, Inc. ("Buyer"), Endocare, Inc.
("Parent"), and Timm Medical Technologies, Inc. ("Seller").

                                   ARTICLE I.

                  SALE OF ASSETS AND ASSUMPTION OF LIABILITIES

Section 1.01 Definitions.

      (a)   "Assignment and Assumption Agreement" shall have the meaning set
            forth in Section 3.01(a)(ii).

      (b)   "Assumed Contract" shall have the meaning set forth in Section 1.03.

      (c)   "Basket Amount" shall have the meaning set forth in Section 4.05(b).

      (d)   "Bill of Sale" shall have the meaning set forth in Section
            3.01(a)(i).

      (e)   "Closing" shall have the meaning set forth in Section 1.04.

      (f)   "Closing Date" shall have the meaning set forth in Section 1.04.

      (g)   "Consent(s)" shall have the meaning set forth in Section 2.01(d).

      (h)   "Damages" shall have the meaning set forth in Section 4.02.

      (i)   "Escrow Agent" shall have the meaning set forth in Section 1.05(a).

      (j)   "Escrow Funds" shall have the meaning set forth in Section 1.05(a).

      (k)   "Facility Inventory" shall have the meaning set forth in Section
            1.05(b).

      (l)   "Facility Inventory Estimate" shall have the meaning set forth in
            Section 1.05(b).

      (m)   "Field Inventory" shall have the meaning set forth in Section
            1.05(c).

      (n)   "Income Taxes" shall have the meaning set forth in Section 1.07(a).

      (o)   "Indemnified Party" shall have the meaning set forth in Section
            4.04(a).

      (p)   "Intellectual Property Assignment" shall have the meaning set forth
            in Section 3.01(a)(iii)

      (q)   "Intellectual Property Rights" shall have the meaning set forth in
            Section 2.01(e).

      (r)   "Knowledge" shall mean as to an entity that such entity shall be
            deemed to have Knowledge of a particular fact or other matter if any
            individual who is serving as
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            an executive or corporate-level officer of such entity or its parent
            entity is actually aware of such fact or other matter.

      (s)   "Liens" shall have the meaning set forth in Section 2.01(c).

      (t)   "Maximum Amount" shall have the meaning set forth in Section
            4.05(a).

      (u)   "Permitted Liens" shall mean any encumbrance for Taxes not yet due
            or delinquent or being contested in good faith by appropriate
            proceedings for which adequate reserves have been established in
            accordance with generally accepted accounting principles and (ii)
            any minor imperfections of title or similar encumbrances which
            individually or in the aggregate with other such encumbrances does
            not impair the value of the property subject to such encumbrance.

      (v)   "Product" means Seller's Dura II malleable penile implant device and
            all accessory items.

      (w)   "Purchased Assets" shall have the meaning set forth in Section
            1.02(a).

      (x)   "Purchase Price" shall mean all amounts payable by Buyer pursuant to
            Section 1.05.

      (y)   "Schedule or Schedules" means the schedules provided by Seller and
            Parent to Buyer at Closing, which are incorporated herein by
            reference.

      (z)   "Taxes" shall have the meaning set forth in Section 1.07(a).

      (aa)  "Transfer Taxes" shall have the meaning set forth in Section
            1.07(a).

Section 1.02 Sale and Purchase of Assets.

      (a)   Assets to be Purchased. At the Closing, upon satisfaction of all
            conditions to the obligations of the parties contained herein (other
            than such conditions as will have been waived in accordance with the
            terms hereof), Seller shall sell, assign, transfer, convey and
            deliver to Buyer and Buyer shall accept and purchase, all of
            Seller's right, title and interest in and to all of the assets set
            forth on Schedule 1.02 (collectively, the "Purchased Assets"):

      (b)   Excluded Assets. The Buyer and Seller acknowledge and agree that the
            only assets of Seller to be sold to Buyer are the Purchased Assets
            specifically identified on Schedule 1.02 and that no other assets of
            Seller are being sold under this Agreement.

Section 1.03 Assumption of Liabilities. Except for the following liabilities
(the "Assumed Liabilities"): (i) Seller's obligations under the Assumed
Contracts set forth in Schedule 1.03 (collectively, the "Assumed Contracts"), to
the extent that such obligations are incurred, accrue or arise on or after the
Closing Date, and (ii) Seller's warranty obligations arising from sales of


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the Product, Buyer will not assume, and will not be liable for, any liabilities
or obligations of Seller, whether known, unknown, contingent, absolute,
determined, indeterminable or otherwise on the Closing Date, whether incurred or
accruing prior to, on or after the Closing Date.

Section 1.04 Closing. The closing of the purchase and sale of the Purchased
Assets (the "Closing") will take place on April 7, 2003 (the "Closing Date"), at
the offices of Morrison & Foerster LLP, 3811 Valley Centre Drive, Suite 500, San
Diego, California, unless another date or place is agreed to in writing by the
parties hereto.

Section 1.05 Purchase Price. In consideration for the Purchased Assets acquired
hereunder, Buyer shall pay the following (the "Purchase Price"):

      (a)   Initial Cash Payment. In consideration for the Purchased Assets
            acquired hereunder, Buyer shall pay at Closing an amount equal to
            One Million Nine Hundred Thousand Dollars ($1,900,000) as follows:
            (i) One Hundred Fifty Thousand Dollars ($150,000) (the "Escrow
            Funds") to the escrow agent (the "Escrow Agent") specified in the
            Escrow Agreement to be held in escrow to secure any indemnification
            obligation of Seller or Parent under Section 4; and (ii) One Million
            Seven Hundred Fifty Thousand Dollars ($1,750,000) to Seller, by bank
            wire transfer in immediately available funds to such bank account as
            is designated in writing by Seller.

      (b)   Initial Inventory Payment. In addition to the amounts paid under
            Section 1.05(a) above, Buyer shall pay to Seller, by bank wire
            transfer in immediately available funds to such bank account as is
            designated in writing by Seller at Closing, a non-refundable payment
            in the amount of Two Hundred Fifty Thousand Dollars ($250,000) (the
            "Facility Inventory Estimate"). The Facility Inventory Estimate
            represents a good faith estimate of the direct cost of Seller's raw
            material, works-in-process and finished goods inventory that has a
            minimum of two (2) years shelf life remaining as of the Closing Date
            that is located in one of Seller's facilities at the time of the
            Closing, as set forth in Schedule 1.05(b) (collectively "Facility
            Inventory").

      (c)   Additional Inventory Payment. Seller shall prepare as Schedule
            1.05(c) and deliver just prior to Closing a good faith estimate of
            its direct cost of finished goods inventory that is not located in
            one of Seller's facilities at the time of Closing (collectively, the
            "Field Inventory"). Any item of Field Inventory that is implanted in
            a surgical procedure that is covered by a representative of Seller
            during the two (2) weeks following the Closing shall constitute a
            sale of product by Seller and such item of Field Inventory and any
            associated purchase order, shall not be purchased by Buyer. Any item
            of Field Inventory that is implanted in a surgical procedure that is
            not covered by a representative of Seller during the two (2) weeks
            following the Closing shall constitute a sale of product by Buyer
            and shall be purchased by Buyer. Seller shall have the option of
            having one of its representatives cover any such surgical procedure
            during the two (2) weeks following the Closing. Promptly after the
            second week following the Closing, Seller shall prepare in good
            faith and deliver to Buyer a revised and updated


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            statement of Seller's direct cost for all remaining Field Inventory
            along with all such Field Inventory and any Facility Inventory not
            already delivered to Buyer. Within one week following receipt of
            such statement, Field Inventory and remaining Facility Inventory,
            Buyer shall pay to Seller, by bank wire transfer in immediately
            available funds to such bank account as is designated in writing by
            Seller, the value of the Field Inventory and Facility Inventory
            received that has a minimum of two (2) years shelf life remaining as
            of the Closing Date as set forth in such revised and updated
            schedule, less the $250,000 initial inventory payment contemplated
            by Section 1.05(b); provided, however, that in the event that the
            aggregate value of such Field Inventory and Facility Inventory is
            less than the $250,000 initial inventory payment contemplated by
            Section 1.05(b), Seller shall pay Buyer the difference.

Section 1.06 Release of Escrow Funds. The Escrow Funds shall not be distributed
to Seller until that date which is twelve (12) months after the Closing Date,
and shall only be distributed in accordance with the terms and conditions of the
Escrow Agreement. In the event that Buyer shall have perfected, prior to the
expiration of such 12-month period, a claim for indemnification pursuant to
Article 4, Buyer shall endeavor in good faith to determine a reasonable estimate
of the maximum amount of such claim and shall instruct the Escrow Agent to
distribute any excess amount of Escrow Funds to Seller in accordance with the
terms of the Escrow Agreement.

Section 1.07 Tax Matters.

      (a)   Notwithstanding any legal requirements to the contrary, Buyer and
            Seller shall each be responsible for and pay fifty percent (50%) of
            any Transfer Taxes when due, and Buyer shall, at its own expense,
            file all necessary Tax returns and other documentation with respect
            to all such Transfer Taxes; provided, however, that, if required by
            any legal requirement, Seller will join in the execution of any such
            Tax returns and other documentation. "Transfer Taxes" shall mean all
            federal, state, local or foreign sales, use, transfer, real property
            transfer, mortgage recording, stamp duty, value-added or similar
            Taxes that may be imposed in connection with the transfer of
            Purchased Assets, together with any interest, additions to Tax or
            penalties with respect thereto and any interest in respect of such
            additions to Tax or penalties; but excluding all Income Taxes.
            "Income Taxes" shall mean any net income, gross income, gross
            receipts, franchise, profits, gains or alternative or add-on minimum
            Tax or comparable governmental fee or other assessment or charge of
            any kind whatsoever, together with any interest or any penalty,
            addition to Tax or additional amount and any interest on such
            penalty, addition to Tax or additional amount, imposed by any Tax
            authority. "Tax" (and, with correlative meaning, "Taxes" and
            "Taxable") shall mean any net income, alternative or add-on minimum
            tax, gross income, gross receipts, sales, use, ad valorem, transfer,
            franchise, profits, license, withholding, payroll, employment,
            excise, severance, stamp, occupation, premium, property,
            environmental or windfall profit tax, custom, duty or other tax,
            together with any interest or any penalty, addition to tax or
            additional amount and any interest on such penalty, addition to tax
            or additional amount, imposed by any Tax authority.


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      (b)   Except as provided in Section 1.07(a), Seller shall be responsible
            for and shall (i) pay any Taxes (and shall be entitled to all
            refunds of any Taxes) arising or resulting from or in connection
            with the ownership or operation of the Purchased Assets (including
            Income Taxes arising from or relating to the sale of the Purchased
            Assets hereunder) attributable to any Taxable period ending on or
            before the Closing Date, or, in the case of any Taxable period which
            includes the Closing Date, the portion of such period up to and
            including the Closing Date, and (ii) pursuant to Section 4.02,
            indemnify and hold harmless Buyer and its successors and assigns for
            Taxes of Seller or Parent that is imposed with respect to the
            Purchased Assets relating to any taxable period or portion thereof
            ending on or before the Closing Date (regardless of whether or not
            such Taxes result in Liens on the Purchased Assets). Except as
            provided in Section 1.07(a), Buyer shall be responsible for and
            shall (i) pay any Taxes (and shall be entitled to all refunds of any
            Taxes) arising or resulting from or in connection with the ownership
            or operation of the Purchased Assets attributable to any Taxable
            period beginning after the Closing Date or, in the case of any
            Taxable period which includes, but does not begin on, the Closing
            Date, the portion of such period beginning after the Closing Date,
            and (ii) pursuant to Section 4.03, indemnify and hold harmless
            Seller and its successors and assigns for Taxes of Buyer that is
            imposed with respect to the Purchased Assets relating to any taxable
            period or portion thereof ending after the Closing Date.

      (c)   All real property, personal property, ad valorem or other similar
            Taxes (not including Transfer Taxes or Income Taxes) levied with
            respect to the Purchased Assets for a Taxable period which includes
            (but does not end on) the Closing Date shall be apportioned between
            Seller and Buyer based on the number of days included in such period
            up to but not including the Closing Date and the number of days
            included in such period beginning on the Closing Date.

Section 1.08 Allocation of Purchase Price. As soon as practicable after the
Closing Date, Buyer shall provide to Seller for Seller's review and approval
(which approval shall not be unreasonably withheld) a proposed allocation of the
Purchase Price among the various classes of Purchased Assets (as such classes
are defined for the purposes of Section 1060 of the Code). All allocations made
pursuant to this Section 1.08 shall be made in accordance with the requirements
of Section 1060 of the Code. None of the parties shall take a position on any
Tax return (including IRS Form 8594), before any Tax authority or in any
judicial proceeding that is in any manner inconsistent with such allocation
without the written consent of the other parties to this Agreement or unless
specifically required pursuant to a determination by an applicable Tax
authority. The parties shall promptly advise each other of the existence of any
tax audit, controversy or litigation related to any allocation hereunder.

Section 1.09 Bulk Transfers. The Seller has requested that Buyer waive, and
Buyer hereby agrees to waive, the requirements of the Uniform Commercial Code
concerning bulk transfers, as in effect in the various states in which the
Purchased Assets are located. The parties expressly agree hereto that Seller's
obligation to indemnify Buyer under Section 4.02 includes any claims by
creditors of Seller against Buyer arising, directly or indirectly, in connection
with such request and waiver.


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Section 1.10 Press Releases. After the Closing, Buyer, Seller and Parent may
issue press releases or other publicity announcing the acquisition of the
Purchased Assets without the consent of the other party, provided that such
issuing party provides the other party a copy of such press release prior to
issuing such press release.

                                  ARTICLE II.

                         REPRESENTATIONS AND WARRANTIES

Section 2.01 Representations and Warranties of Seller and Parent.

      Seller and Parent, jointly and severally, represent and warrant to Buyer
as follows (except as set forth on Schedule 2.01, which exceptions shall be
deemed to be representations and warranties as if made hereunder):

      (a)   Organization. Each of Parent and Seller is a corporation duly
            incorporated, validly existing and in good standing under the laws
            of the state of Delaware.

      (b)   Authorization. Each of Parent and Seller has all requisite corporate
            power and authority to enter into and perform its obligations under
            this Agreement and to carry out the transactions contemplated
            hereby. The respective Boards of Directors of each of Parent and
            Seller has duly authorized the execution and delivery of this
            Agreement and the other transactions contemplated hereby and, no
            other corporate proceedings on the part of Parent or Seller are
            necessary to authorize this Agreement and the transactions
            contemplated hereby. This Agreement has been duly executed and
            delivered by Parent and Seller and constitutes a valid and binding
            obligation of Parent and Seller enforceable in accordance with its
            terms, except as may be limited by (a) applicable bankruptcy,
            insolvency, reorganization, moratorium, and other laws of general
            application affecting enforcement of creditors' rights generally,
            and (b) laws relating to the availability of specific performance,
            injunctive relief, or other equitable remedies.

      (c)   Title. Except as set forth in Schedule 2.01(c) and except with
            respect to Intellectual Property Rights, which are addressed in
            Section 2.01(e) below, Seller has good and marketable title to all
            of the Purchased Assets, in each case free and clear of all
            mortgages, liens, security interests, pledges, charges or
            encumbrances of any nature whatsoever ("Liens") other than Permitted
            Liens.

      (d)   Consents and Approvals. Except for filings required for the
            assignment of the Intellectual Property Rights set forth on Schedule
            1.02 and as otherwise set forth in Schedule 2.01(d), no consent,
            approval, order or authorization of or from, or registration,
            notification, declaration or filing with (hereinafter sometimes
            separately referred to as a "Consent" and sometimes collectively as
            "Consents") of any individual or entity, including without
            limitation any governmental authority, is required in connection
            with the execution, delivery or performance of this Agreement by the
            Seller or the consummation by the Seller of the transactions
            contemplated herein.


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      (e)   Intellectual Property Rights. Schedule 1.02 contains a complete list
            of all U.S. and foreign patents, patent applications, registered
            trademarks and trademark applications owned by Seller, which relate
            exclusively to the Products (collectively, "Intellectual Property
            Rights"). To Seller's Knowledge, Seller owns, free and clear of all
            Liens, except Permitted Liens, all such Intellectual Property
            Rights. No judgment, decree, injunction, rule or order against
            Seller directly or indirectly relating to Seller's rights in and to
            the Intellectual Property Rights has been rendered by any
            governmental entity which would limit, cancel or question the
            validity of or Seller's rights in and to any of the Intellectual
            Property Rights. The Seller has not received written notice, and
            does not otherwise have Knowledge, of any pending or threatened
            suit, action or proceeding that either does or would limit, cancel
            or question the validity of, or Seller's rights in and to, any of
            the Intellectual Property Rights. The Seller has not received
            written notice, and does not otherwise have Knowledge, of any
            allegations, assertions or other indications that the Product
            infringes the intellectual property rights of a third party.

      (f)   Litigation. Except as set forth in Schedule 2.01(f), there is no
            action, suit, proceeding at law or in equity by any person or
            entity, or any arbitration or any administrative or other proceeding
            by or before (or any investigation by) any governmental authority,
            pending or, to Parent's or Seller's Knowledge, threatened, against
            Parent or Seller, respectively, relating directly to any of the
            Purchased Assets, or which questions or challenges the validity of
            this Agreement or would prevent Parent or Seller from completing the
            transactions contemplated by the Agreement. Neither Parent nor
            Seller is not subject to any judgment, order or decree entered in
            any lawsuit or proceeding to which it is a party relating directly
            to the Purchased Assets.

      (g)   Tax Matters. There are no Liens for Taxes on the Purchased Assets,
            other than Permitted Liens, and no audit of any Tax return with
            respect to the Purchased Assets is currently pending or, to Seller's
            Knowledge, threatened.

      (h)   Inventories. Schedule 1.02 sets forth a complete and accurate list
            of all quantities of inventory of the Products as of the Closing
            Date, including all raw materials, work-in-process and finished
            goods, except for obsolete items and items of below-standard
            quality. All items of finished goods inventory set forth on Schedule
            1.02: (i) are of a quality and quantity usable in the ordinary
            course of business; (ii) meet the specifications applicable to such
            inventory; and (iii) have an expiration date at least two (2) years
            after the Closing Date.

      (i)   Assumed Contracts. Seller has delivered to Buyer true and complete
            copies of all of the Assumed Contracts. All of the Assumed Contracts
            are valid and enforceable by and against Seller in accordance with
            their respective terms. Neither Seller nor, to Seller's Knowledge,
            the other party thereto is in breach of any of their obligations
            under any of the Assumed Contracts.


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      (j)   Orders, Commitments and Returns. All accepted and unfulfilled orders
            for the sale of the Products were made in bona fide transactions in
            the ordinary course of business. To Seller's Knowledge, there are no
            claims against Seller to return the Products by reason of alleged
            over-shipments, defective products or otherwise, or of Products in
            the hands of customers or distributors under an understanding that
            such Products would be returnable.

      (k)   Dealers and Suppliers. There has not been in the 12-month period
            prior to the date hereof any written notice from any material
            supplier of any raw materials or components used in manufacturing
            the Products of such supplier's intention to discontinue the
            relationship.

Section 2.02 Representations and Warranties of Buyer.

      Buyer represents and warrants to, and agrees with, Seller as follows:

      (a)   Organization. Buyer is a corporation duly incorporated, validly
            existing and in good standing under the laws of the state of
            Delaware.

      (b)   Binding Obligation. Buyer has all requisite corporate power and
            authority to enter into and perform its obligations under this
            Agreement and to carry out the transactions contemplated hereby. The
            Board of Directors of Buyer has duly authorized the execution and
            delivery of this Agreement and the other transactions contemplated
            hereby and, no other corporate proceedings on the part of Buyer are
            necessary to authorize this Agreement and the transactions
            contemplated hereby. This Agreement has been duly executed and
            delivered by Buyer and constitutes a valid and binding obligation of
            Buyer enforceable in accordance with its terms, except as may be
            limited by (a) applicable bankruptcy, insolvency, reorganization,
            moratorium, and other laws of general application affecting
            enforcement of creditors' rights generally, and (b) laws relating to
            the availability of specific performance, injunctive relief, or
            other equitable remedies.

      (c)   Consents and Approvals. No Consents of any individual or entity,
            including without limitation any governmental authority, is required
            in connection with the execution, delivery or performance of this
            Agreement by the Buyer or the consummation by the Buyer of the
            transactions contemplated herein.

      (d)   Litigation. To Buyer's Knowledge, there is no action, suit,
            proceeding at law or in equity by any person or entity, or any
            arbitration or any administrative or other proceeding by or before
            (or any investigation by) any governmental authority, pending or
            threatened, against Buyer which questions or challenges the validity
            of this Agreement or would prevent Buyer from completing the
            transactions contemplated by the Agreement.

                                  ARTICLE III.

                               CLOSING OBLIGATIONS


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Section 3.01 Seller Closing Deliveries. Notwithstanding any other provision of
this Agreement to the contrary, the obligation of Buyer to complete the
transactions contemplated herein will be subject to the satisfaction at or prior
to the Closing of each of the following conditions:

      (a)   Seller shall deliver, or cause to be delivered, to Buyer at or prior
            to the Closing the following documents:

            (i)   a bill of sale for all of the Purchased Assets substantially
                  in the form of Schedule 3.01(a)(i) (the "Bill of Sale")
                  executed by Seller;

            (ii)  an assignment and assumption of the Assumed Contracts
                  substantially in the form of Schedule 3.01a(ii) (the
                  "Assignment and Assumption Agreement") executed by Seller;

            (iii) one or more intellectual property assignments, each
                  substantially in the form of Schedule 3.01(a)(iii) (together,
                  the "Intellectual Property Assignments") executed by Seller;

            (iv)  an escrow agreement substantially in the form of Schedule
                  3.01(a)(iv) (the "Escrow Agreement") executed by Seller,
                  Parent and the Escrow Agent;

            (v)   any Consents required to assign the Assumed Contracts to
                  Buyer; and

            (vi)  an opinion from Morrison & Foerster LLP, counsel to the Seller
                  and Parent, in a form acceptable to the Buyer and dated as of
                  the Closing Date.

Section 3.02 Buyer Closing Deliveries. Notwithstanding any other provision of
this Agreement to the contrary, the obligation of Buyer to complete the
transactions contemplated herein will be subject to the satisfaction at or prior
to the Closing of each of the following conditions:

      (a)   Buyer shall deliver, or cause to be delivered, to Seller at or prior
            to the Closing the following documents:

            (i)   the initial cash payment contemplated by Section 1.05(a) and
                  the initial inventory payment contemplated by Section 1.05(b);

            (ii)  the Assignment and Assumption Agreement executed by Buyer;

            (iii) the Escrow Agreement executed by Buyer and the Escrow Agent;
                  and the Intellectual Property Assignment executed by Buyer;
                  and

            (iv)  an opinion from Oppenheimer Wolff & Donnelly LLP, counsel to
                  the Buyer, in a form acceptable to the Seller and Parent,
                  dated as of the Closing Date.


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                                  ARTICLE IV.

                          SURVIVAL AND INDEMNIFICATION

Section 4.01 Survival. The representations, warranties and covenants of each
party contained in this Agreement, and all claims in respect of any breach of
any such representation, warranty or covenant, will survive the Closing and
shall expire upon that date which is twelve (12) months after the Closing Date.
Notwithstanding the foregoing, any representation, warranty or covenant that
would otherwise terminate in accordance with this Section 4.01 shall continue to
survive, if a notice of Claim pursuant to this Article 4 shall have been timely
given under Section 4.04 on or prior to such termination date, until the related
claim has been satisfied or otherwise resolved as provided herein. The right to
indemnification or any other remedy based on representations, warranties,
covenants and obligations in this Agreement will not be affected by any
investigation conducted, whether before or after the execution and delivery of
this Agreement or the Closing Date, with respect to the accuracy or inaccuracy
of or compliance with, any such representation, warranty, covenant or
obligation. The waiver of any condition expressly based on the accuracy of any
representation or warranty, or on the performance of or compliance with any
covenant or obligation, will not affect the right to indemnification based on
such representations, warranties, covenants and obligations.

Section 4.02 Indemnification by Seller and Parent. Except as hereinafter set
forth, Seller and Parent shall indemnify and hold harmless Buyer and its
successors and assigns and its and their respective officers, directors,
shareholders, employees and agents, against, and in respect of, any and all
damages, claims, losses, liabilities and expenses, including, without
limitation, reasonable legal, accounting and other expenses (collectively,
"Damages"), which may arise out of: (a) any misrepresentation or other breach or
violation of this Agreement by Seller or Parent; (b) Seller's ownership or
operation of the Purchased Assets prior to the Closing, other than the Assumed
Liabilities; or (c) any product liability claim or other third party claim
relating to the Product, whether presently in existence or arising hereafter
from acts, events, conditions or circumstances existing or occurring prior to
the Closing Date, including, but not limited to, the Pace Litigation (as defined
in Schedule 2.01(f)).

Section 4.03 Indemnification by Buyer. Except as hereinafter set forth, Buyer
shall indemnify and hold harmless Seller and Parent and their successors and
assigns and each of their respective officers, directors, shareholders,
employees and agents, against, and in respect of, any and all Damages, which may
arise out of: (a) any misrepresentation or other breach or violation of this
Agreement by Buyer; (b) Buyer's ownership or operation of the Purchased Assets
after the Closing; or (c) any product liability claim or other third party claim
relating to the Product, whether presently in existence or arising hereafter
from acts, events, conditions or circumstances existing or occurring on or after
the Closing Date.

Section 4.04 Claims for Indemnification.

      (a)   General. The parties intend that all indemnification claims be made
            as promptly as practicable by the party seeking indemnification (the
            "Indemnified Party"). Whenever any claim arises for indemnification
            hereunder the Indemnified Party will promptly notify the party from
            whom indemnification is sought (the


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            "Indemnifying Party") of the claim and, when known, the facts
            constituting the basis for such claim. The failure to so notify the
            Indemnifying Party will not relieve the Indemnifying Party of any
            liability that it may have to the Indemnified Party except to the
            extent the Indemnifying Party demonstrates that the defense of such
            action is prejudiced thereby.

      (b)   Claims by Third Parties. With respect to claims made by third
            parties, if the Indemnifying Party admits to the Indemnified Party
            and agrees in writing that it will be obligated under the terms of
            its indemnity hereunder in connection with such claim, the
            Indemnifying Party will be entitled to assume control of the defense
            of such action or claim, at its sole expense, with counsel
            reasonably satisfactory to the Indemnified Party; provided, however,
            that:

            (i)   the Indemnified Party will be entitled to participate in the
                  defense of such claim and to employ counsel at its own expense
                  to assist in the handling of such claim;

            (ii)  no Indemnifying Party will consent to the entry of any
                  judgment or enter into any settlement that (A) does not
                  include as an unconditional term thereof the giving by each
                  claimant or plaintiff to each Indemnified Party of a release
                  from all liability in respect of such claim or (B) would
                  result in the imposition against the Indemnified Party of
                  injunctive or other equitable relief; or (C) could materially
                  interfere with the business, operations or assets of the
                  Indemnified Party; and,

            (iii) if the Indemnifying Party does not assume control of the
                  defense of such claim in accordance with the foregoing
                  provisions within ten (10) business days after receipt of
                  notice of the claim, the Indemnified Party will have the right
                  to defend such claim in such manner as it may deem appropriate
                  at the reasonable cost and expense of the Indemnifying Party,
                  and the Indemnifying Party will promptly reimburse the
                  Indemnified Party therefor in accordance with this Section
                  4.04; provided that the Indemnifying Party and the Indemnified
                  Party will not consent to the entry of any judgment or enter
                  into any settlement without the written consent of the
                  Indemnifying Party, which consent will not be unreasonably
                  withheld or delayed, and that (A) does not include as an
                  unconditional term thereof the giving by each claimant or
                  plaintiff to each Indemnified Party of a release from all
                  liability in respect of such claim or (B) would result in the
                  imposition against the Indemnified Party of injunctive or
                  other equitable relief; or (C) could materially interfere with
                  the business, operations or assets of the Indemnified Party;
                  provided, further, that if the Indemnified Party assumes the
                  defense of such claim, the Indemnified Party will keep the
                  Indemnifying Party reasonably informed of the progress of any
                  such defense, compromise or settlement and will consult with
                  and consider reasonable advice from the Indemnifying Party.

Section 4.05 Indemnification Limits.


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      (a)   Except for fraud, the indemnification provisions set forth in this
            Article 4 shall be the exclusive remedy for the Indemnified Party
            for a breach of any representation, warranty or covenant by the
            Indemnifying Party and shall be in lieu of any rights the
            Indemnified Party may have under law or in equity with respect to
            any such breaches or otherwise. The liability of each party as an
            Indemnifying Party hereunder shall not exceed $1,000,000 in the
            aggregate (the "Maximum Amount").

      (b)   Except for fraud, none of Seller, Parent or Buyer, as the case may
            be, will be entitled to indemnification for any Damages under this
            Article 4 unless the aggregate of all Damages is more than Fifty
            Thousand Dollars ($50,000) (the "Basket Amount"). When the aggregate
            amount of all such Damages hereunder equals or exceeds the Basket
            Amount, Buyer, Seller or Parent, as the case may be, will be
            entitled to full indemnification of all claims, including the Basket
            Amount. The parties hereto agree that the Basket Amount is not a
            deductible amount, nor that the Basket Amount will be deemed to be a
            definition of "material" for any purpose in this Agreement.

Section 4.06 Escrow Funds. The Escrow Funds will be held in an interest-bearing
escrow account as established pursuant to the Escrow Agreement for the purpose
of satisfying claims by Buyer for indemnification under this Article 4 and will
be released to Buyer only in accordance with the terms of the Escrow Agreement.
Subject to, and in accordance with, the terms and conditions set forth in the
Escrow Agreement, the Escrow Agent shall deliver or cause to be delivered to
Seller the balance, if any, of the Escrow Funds.

                                   ARTICLE V.

                               GENERAL PROVISIONS

Section 5.01 Further Assurances; Cooperation. Each of the parties hereto will,
until, during, and after Closing, execute and deliver such instruments and take
such other actions as the other party or parties, as the case may be, may
reasonably require in order to carry out the intent of this Agreement. Without
limiting the generality of the foregoing, at any time after the Closing, at the
reasonable request of Buyer and without further consideration, Seller will
execute and deliver such instruments of sale, transfer, conveyance, assignment
and confirmation and take such action as Buyer may reasonably deem necessary or
desirable in order to more effectively transfer, convey and assign to Buyer, and
to confirm Buyer's title to, all of the Purchased Assets, and to put Buyer in
actual possession and operating control thereof.

Section 5.02 Notices. All notices, requests, demands, claims and other
communications hereunder shall be in writing. Any notice, request, demand,
claim, or other communication hereunder shall be deemed duly given (i) if
personally delivered, when so delivered, (ii) if mailed, two business days after
having been sent by registered or certified mail, return receipt requested,
postage prepaid and addressed to the intended recipient as set forth below,
(iii) if given by facsimile, once such notice or other communication is
transmitted to the facsimile number specified below and electronic confirmation
is received, provided that such notice or other communication is promptly
thereafter mailed in accordance with the provisions of clause


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(ii) above or (iv) if sent through an overnight delivery service in
circumstances to which such service guarantees next day delivery, the day
following being so sent:

            If to Seller or Parent:

                  Endocare, Inc.
                  201 Technology Drive
                  Irvine, California 92618
                  Attention: President
                  Fax (949) 450-5302

            with a required copy to:

                  Morrison & Foerster LLP.
                  3811 Valley Centre Drive, Suite 500
                  San Diego, California 92130-2332
                  Attention: Steven G. Rowles
                  Fax (858) 720-5125

            If to Buyer:

                  American Medical Systems, Inc.
                  10700 Bren Road West
                  Minnetonka, Minnesota 55343
                  Attn: Chief Executive Officer
                  Fax: (612) 930-6695

            with a required copy to:

                  Oppenheimer Wolff & Donnelly LLP
                  Plaza VII, Suite 3300
                  45 South Seventh Street
                  Minneapolis, MN 55402
                  Attn: Tom Letscher
                  Fax: (612) 607-7100

Section 5.03 Amendments; No Waivers. Any provision of this Agreement may be
amended or waived if, and only if, such amendment or waiver is in writing and
signed, in the case of an amendment, by all parties hereto, or in the case of a
waiver, by the party against whom the waiver is to be effective. No waiver by a
party of any default, misrepresentation or breach of warranty or covenant
hereunder, whether intentional or not, shall be deemed to extend to any prior or
subsequent default, misrepresentation or breach of warranty or covenant
hereunder or affect in any way any rights arising by virtue of any prior or
subsequent occurrence. No failure or delay by a party in exercising any right,
power or privilege hereunder shall operate as a waiver thereof nor shall any
single or partial exercise thereof preclude any other or further exercise
thereof or the exercise of any other right, power or privilege.


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Section 5.04 Expenses. All costs, fees and expenses incurred in connection with
the negotiation, preparation, execution, delivery and performance of this
Agreement and in closing and carrying out the transactions contemplated hereby
shall be paid by the party incurring such cost or expense.

Section 5.05 Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
permitted assigns. No party hereto may assign either this Agreement or any of
its rights, interests or obligations hereunder without the prior written
approval of each other party.

Section 5.06 Governing Law. This Agreement shall be governed by, construed and
enforced in accordance with the internal laws of the State of Delaware
(regardless of the laws that might otherwise govern under applicable principles
of conflicts of law).

Section 5.07 Counterparts. This Agreement may be signed in any number of
counterparts and the signatures delivered by facsimile, each of which shall be
an original, with the same effect as if the signatures thereto and hereto were
upon the same instrument.

Section 5.08 Entire Agreement. This Agreement (including all Exhibits and
Schedules and all other agreements referred to herein or therein which are
hereby incorporated by reference and the other agreements executed
simultaneously herewith) constitutes the entire agreement between the parties
with respect to the subject matter hereof and supersedes all prior agreements,
understandings and negotiations, both written and oral, between the parties with
respect to the subject matter of this Agreement. Neither this Agreement nor any
provision hereof is intended to confer upon any person or entity other than the
parties hereto any rights or remedies hereunder.

Section 5.09 Severability. If any provision of this Agreement shall be held by a
court of competent jurisdiction to be invalid, unenforceable or void, the
remainder of this Agreement shall remain in full force and effect only if, after
excluding the portion deemed to be unenforceable, the remaining terms shall
provide for the consummation of the transactions contemplated hereby in
substantially the same manner as originally set forth at the later of the date
this Agreement was executed or last amended.

                   Remainder of Page Intentionally Left Blank


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      IN WITNESS WHEREOF, Buyer and Seller have executed this Agreement as of
the date first written above.


AMERICAN MEDICAL SYSTEMS, INC.

By: _________________________________

Name: _______________________________

Title: ______________________________


ENDOCARE, INC.

By: _________________________________

Name: _______________________________

Title: ______________________________


TIMM MEDICAL TECHNOLOGIES, INC.

By: _________________________________

Name: _______________________________

Title: ______________________________


               [SIGNATURE PAGE TO AGREEMENT OF PURCHASE AND SALE]