Document:

<PAGE>   1
                                                                   EXHIBIT 10.19

                                                                  EXECUTION COPY

                                      DATED
                                 April 23, 2000

                                  BY AND AMONG

                            MRV COMMUNICATIONS, INC.

                                       AND

                         SUBSIDIARIES/AFFILIATES OF MRV
     (in the case that MRV's subsidiaries/affiliates purchase OIC's shares)

                                       AND

                       OPTRONICS INTERNATIONAL CORPORATION

                                       AND

               SHAREHOLDERS OF OPTRONICS INTERNATIONAL CORPORATION

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                            STOCK PURCHASE AGREEMENT

  Relating to the sale and purchase of up to one hundred percent (100%) of the
                        Ordinary Shares in the capital of
                       OPTRONICS INTERNATIONAL CORPORATION

         and the sale and purchase of One Million Seven Hundred Thousand
                        Common Shares in the capital of
                            MRV COMMUNICATIONS, INC.

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

                                BAKER & MCKENZIE
                           15th Floor, Hung Tai Centre
                             168 Tun Hwa North Road
                                 Taipei, Taiwan

<PAGE>   2

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
SECTION                                                                       PAGE
-------                                                                       ----
<S>   <C>                                                                     <C>
1.    Definitions..............................................................2
2.    The Transaction..........................................................2
3.    The Closing..............................................................4
4.    Deliveries at the Closing................................................4
5.    Representations and Warranties of OIC and Selling Shareholders...........5
6.    Representations and Warranties of MRV...................................17
7.    Pre-Closing Covenants...................................................19
8.    Conditions Precedent to Closing.........................................22
9.    Post Closing Covenants..................................................24
10.   Indemnification and Escrow..............................................25
11.   Termination.............................................................28
12.   Transfer Restriction....................................................28
13.   Miscellaneous...........................................................28
</TABLE>

SCHEDULES
---------

1.    List of Signing Shareholders and Shareholding
2.    List of Subsidiaries of OIC
3.    List of Equity Interests hold by OIC and its Subsidiaries
4.    Financial Statements of OIC and its Subsidiaries
5.    List of Warehouses
6.    List of Liabilities
7.    List of Material Changes
8.    List of Real Properties
9.    List of Tangible Personal Property
10.   List of Intellectual Properties
11.   List of License of any Intellectual Properties
12.   List of Contracts
13.   List of Permits
14.   List of Non-Renewable Permit
15.   List of Encumbrances
16.   List of Litigation
17.   List of Employee Benefits
18    List of Unemployment Compensation
19.   List of Distributors
20.   List of Suppliers
21.   List of Related Party Transaction
22.   List of Directors; Officers; Banks and Powers of Attorney
23.   List of Insurance
24.   List of Principal Employees
25.   List of Current Competing Investments of Selling Shareholders

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EXHIBITS
--------

A.    Form of Power of Attorney to be issued to Attorneys-in-Fact
B.    Form of Power of Attorney to be issued to Closing Agent
C.    Form of OIC's Bring-Down Certificate
D.    Form of MRV's Bring-Down Certificate
E.    Form of Employment Agreement
F.    Form of Escrow Agreement
G.    Letter of Consent for Principal Employees

                                       ii
<PAGE>   4

                            STOCK PURCHASE AGREEMENT

THIS STOCK PURCHASE AGREEMENT (this "Agreement") is entered into as of this 23rd
day of April, 2000 by and among Optronics International Corporation., a
corporation organized and existing under the laws of the Republic of China
("OIC") with its principal executive office located at No. 46, Park Avenue II
Road, Science-Based Industrial Park, Hsin Chu, Taiwan, ROC, MRV Communications,
Inc., a corporation organized and existing under the laws of Delaware, U.S.A.
with its principal executive office located at 20415 Nordhoff St., Chatsworth,
CA 91311 U.S.A.("MRV"), and each person listed in the schedule of OIC
shareholders attached hereto as Schedule 1 (individually, a "Signing
Shareholder" and collectively the "Signing Shareholders"), represented by their
attorneys-in-fact, Dr. C. J. Hwang ("Attorneys-in-Fact") (as evidenced by a
Power of Attorney attached hereto as Exhibit A). MRV, OIC and the Signing
Shareholders are referred to herein individually as the "Party" and collectively
as the "Parties".

        WHEREAS, the Signing Shareholders collectively own approximately sixty
percent (60%) of the issued and outstanding shares of the capital stock of OIC
(the "OIC Shares"), each of them in the respective amounts and percentages set
forth on Schedule 1;

        WHEREAS, MRV is authorized to issue up to One Million Seven Hundred
Thousand (1,700,000) new common shares ("MRV Shares") prior to the sale and
transfer of OIC Shares to MRV contemplated by this Agreement;

        WHEREAS, subject to the terms and conditions of this Agreement, (i) MRV
desires to by itself and/or its Subsidiaries or Affiliates purchase up to one
hundred percent (100%) but no less than seventy five percent (75%) of OIC Shares
from the Signing Shareholders and other OIC shareholders (the Signing
Shareholders and other OIC shareholders selling their OIC Shares to MRV (and/or
its Subsidiaries/Affiliates) collectively the "Selling Shareholders"), and the
Signing Shareholders desire to, and will use their best efforts to cause other
Selling Shareholders to sell and transfer their OIC Shares to MRV (and/or its
Subsidiaries/Affiliates) in return for the consideration set forth herein; and
(ii) the Signing Shareholders desire to and will cause other Selling
Shareholders to aggregately purchase certain MRV Shares from MRV, and MRV
desires to sell the MRV Shares up to the same amount to Selling Shareholders in
return for the consideration set forth herein.

        WHEREAS, the Signing Shareholders and OIC will use their best efforts to
obtain the consent of other Selling Shareholders to be a Party of this Agreement
and to be bound by the terms and conditions herein.

        NOW, THEREFORE, in consideration of the premises and the mutual promises
herein made, and in consideration of the representations, warranties, and
covenants herein contained, the Parties agree as follows:

<PAGE>   5

1.      DEFINITIONS

1.1     Generally. As used in this Agreement, capitalized terms not otherwise
        defined shall have the meanings specified in the text hereof or on Annex
        1 hereto (which is incorporated herein by reference), which meanings
        shall be applicable to both the singular and plural forms of the term
        defined.

2.      THE TRANSACTION

2.1     At the Closing (as hereinafter defined), upon satisfaction of the terms
        and conditions set forth herein:

        2.1.1  Purchase and Sale of OIC Shares

        (a)    The Selling Shareholders shall sell, transfer, assign and deliver
               to MRV (and/or its Subsidiaries/Affiliates) at the Closing, and
               MRV (and/or its Subsidiaries/Affiliates) agrees to purchase and
               acquire from the Selling Shareholders and pay therefor at the
               Closing, all of their respective OIC Shares, free and clear of
               any and all Encumbrances, consisting of up to one hundred percent
               (100%) of the total number of issued and outstanding OIC Shares
               as of the Closing Date, at and for an aggregate purchase price of
               One Hundred and Twenty Million United States Dollars (US$
               120,000,000.00) for purchasing one hundred percent (100%) OIC
               Shares (equaling Three United States Dollars (US$3.00) per
               share). The foregoing aggregate purchase price (the "MRV's
               Payment") shall be paid by MRV (and/or its
               Subsidiaries/Affiliates) at the Closing by wire transfer to a
               single bank account in Taiwan designated by the Selling
               Shareholders to MRV (and/or its Subsidiaries/Affiliates) in
               writing at least seven (7) Business Days prior to the Closing
               (the "Taiwan Account"). Such Taiwan Account shall be agreed by
               MRV. MRV's Payment shall be divisible among the Selling
               Shareholders pro rata in accordance with their percentage
               shareholdings in OIC; PROVIDED, HOWEVER, that MRV's Payment shall
               not be released from the Taiwan Account to the Selling
               Shareholders and shall be used as the payment due MRV for the MRV
               Shares being purchased by the Selling Shareholders (as per
               Section 2.1.2 below) and fully wired by the Selling Shareholders
               via the Closing Agent (as hereinafter defined and discussed) on
               their behalf to an account designated by MRV to the Selling
               Shareholders in writing at least seven (7) Business Days prior to
               the Closing (the "MRV Account"). Furthermore, the Selling
               Shareholders shall be liable for (i) the 0.3% share transfer tax
               imposed by Taiwan on the sale of OIC Shares by the Selling
               Shareholders ("The Taiwan Stock Transfer Tax"); (ii) whatever
               costs and fees charged relating to the Taiwan Account for the
               wire transfer; and (iii) the Escrow Fees as described in Section
               10.2.3 (c) below and in the Escrow Agreement (above (i), (ii),
               and (iii) collectively referred to as the "Sellers' Costs").

        (b)    In the event that less than one hundred percent (100%) but not
               less than seventy five percent (75%) of OIC Shares are available
               for sale, MRV's Payment shall be adjusted down by the same
               percentage as those shares not

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<PAGE>   6

               available for sale are as a percentage of the total shares of
               outstanding shares on the date of execution of this Agreement. If
               less than seventy five percent (75%) of OIC Shares are available
               for sale to MRV, MRV shall not be obligated to complete the
               transactions contemplated in this Agreement.

        2.1.2  Purchase and Sale of MRV Shares

        (a)    MRV shall issue and sell to the Selling Shareholders, and the
               Selling Shareholders shall purchase from MRV pro rata in
               accordance with their percentage shareholdings in OIC, the MRV
               Shares, free and clear of any and all Encumbrances, at and for an
               aggregate purchase price of One Hundred and Twenty Million United
               States Dollars (US$120,000,000.00), equaling Seventy United
               States Dollars and Fifty-Eight point Eight United States Cents
               (US$70.588) per share. The foregoing aggregate purchase price
               (the "Selling Shareholders' Payment") shall be paid by the
               Selling Shareholders via the Closing Agent at the Closing by wire
               transfer to the MRV Account. The wire transfer shall be effected
               immediately upon receipt of each installment of the MRV's Payment
               in the Taiwan Account. In order to secure and assure the payment
               to MRV of the Selling Shareholders' Payment, which shall be made
               using a portion of the funds first wired by MRV to the Taiwan
               Account, at least five (5) Business Days prior to the Closing,
               the Selling Shareholders (or Attorney(s)-in-Fact or OIC in whose
               name the Taiwan Account shall be registered) shall give the
               Taiwan Account passbook, chops and a power-of-attorney in the
               form attached as Exhibit B (Power of Attorney-Form B) to the law
               firm of Baker & McKenzie, Taipei Office represented by David Liou
               as the Closing Agent of the Selling Shareholders (the "Closing
               Agent") granting said Closing Agent the exclusive right to give
               instructions to the bank with respect to the Taiwan Account.

        (b)    In the event that less than one hundred percent (100%) but not
               less than seventy five (75%) of OIC Shares are available for
               sale, the number of MRV Shares to be sold to the Selling
               Shareholders and the Selling Shareholders' Payment shall be
               adjusted down by the same percentage as those OIC Shares not
               available for sale are as a percentage of the total OIC Shares of
               outstanding on the date of execution of this Agreement. The
               Selling Shareholders shall advise MRV of the actual number of OIC
               Shares being sold within one month of the execution of this
               Agreement.

        2.1.3  The definite purchaser(s) of OIC Shares and their respective
               purchasing volume of shares in OIC, and recipient(s) of the
               Selling Shareholders' Payment shall be determined and advised by
               MRV in writing to OIC and the Attorney-in-Fact at least Five (5)
               Business Days prior to the Closing. In each of the above
               transactions, the seller shall be liable to pay any applicable
               taxes or duties on the issuance or sale of its shares of stock to
               other party. Thus, the Selling Shareholders shall be liable for
               the payment of the Taiwan Stock Transfer Tax, which shall be
               deducted and paid from the Taiwan Account, as discussed above.
               MRV shall be liable for the payment of the taxes or duties (if
               any) on the issuance and sales of the MRV Shares to the Selling
               Shareholders, which shall be paid by MRV within the

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               period of time required by the laws of the State of Delaware.

        2.1.4  The Principal Employees listed in Schedule 24 shall be granted by
               MRV the options to purchase the common stock of MRV. Such options
               shall have an intrinsic value of Twenty Million United States
               Dollars (US$20,000,000), based on the difference between the
               exercise price and the fair market value of MRV common stock
               valued at the same price as the closing price of the MRV common
               stock as reported on Nasdaq immediately prior to the signing of
               this Agreement. Such options shall vest and become exercisable in
               equal installments at the rate of 1.667% per month commencing on
               the last day of the first full month after the date of this
               Agreement and shall be issued in exchange for equivalent options
               such employees hold in OIC, if any. The exercise price referred
               to in this Article 2.1.4 shall be between Six United States
               Dollars (US$6) and Ten United States Dollars (US$10).

2.2     Notwithstanding the transaction mechanism described in Sections 2.1.1
        and 2.1.2, MRV shall have the option to carry out a direct shares swap
        if MRV's verification with the Taiwan authorities reveals that such
        direct shares swap is feasible prior to the Closing.

2.3     The Parties agree that upon the successful completion of transfer of the
        Selling Shareholders' Payment to the MRV's Account in accordance with
        the provisions of this Agreement, the Closing Agent will thereupon be
        deemed to have been released from any and all obligation arising
        hereunder or from the Agreement. The Parties further agree any of them
        will not hold the Closing Agent liable or responsible for any act it may
        do or omit to do in the exercise of reasonable care, as prudent
        administrator, in good faith, and in compliance with this Agreement. The
        Parties and the Closing Agent agree that the Closing Agent will keep the
        Parties informed of the status and the progress of the Closing matters
        handled by the Closing Agent.

3.      THE CLOSING

3.1     The closing of the transactions contemplated by this Agreement (the
        "Closing") shall take place at the office of Baker & McKenzie, Taipei
        office and be held over a five (5) day or longer period (given the
        necessity of effecting international wire transfers and considering the
        time differences involved), commencing on the later to occur of (a)
        ________, 2000, and (b) five (5) Business Days after all conditions to
        the closing of the transactions contemplated by this Agreement have been
        satisfied or waived (the fourth or the last day of the Closing being the
        "Closing Date"), but in any case not later than _______, 2000 (the
        "Target Day") (unless the Parties shall agree upon a different date or
        location).

4.      DELIVERIES AT THE CLOSING

4.1     Deliveries by the Selling Shareholders

        At the Closing, the Selling Shareholders shall deliver or cause to be
        delivered to

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        MRV:

        (i) stock certificates evidencing OIC Shares, and duly executed stock
        transfer documentation transferring thereof to MRV (including its
        nominees) and/or its Subsidiaries/Affiliates; (ii) the Selling
        Shareholders' Payment, (iii) OIC's Bring-Down Certificate (as defined
        and discussed below and substantially in the form attached as Exhibit
        C); (iv) written consents and the powers of attorney from the other
        Selling Shareholders as described in Section 7.10 and (iv) such other
        instruments, certificates or documents as MRV may reasonably request.

4.2     Deliveries by MRV

        At the Closing Date, MRV shall deliver or cause to be delivered to the
        Selling Shareholders (i) stock certificates evidencing MRV Shares; (ii)
        MRV's Bring-Down Certificate (as defined and discussed below and
        substantially in the form attached as Exhibit D); and (iii) such other
        instruments, certificates or documents as the Selling Shareholders may
        reasonably request.

5.      REPRESENTATIONS AND WARRANTIES OF OIC AND THE SELLING SHAREHOLDERS

OIC and each of the Signing Shareholders hereby and shall cause other Selling
Shareholders to represent, warrant and covenant to MRV as follows at the date
hereof and again as of the Closing Date as follows:

5.1     Power, Authority and Ownership

        5.1.1  The Selling Shareholders have the absolute and unrestricted
               right, power and authority to execute and deliver this Agreement
               and the Powers of Attorney and to perform their obligations
               hereunder with respect to their respective OIC Shares. The
               Attorneys-in-Fact have been duly authorized by each of the
               Signing Shareholders and shall obtain the authorization from the
               other Selling Shareholders before the Closing to execute, deliver
               and perform this Agreement and the transactions contemplated
               herein for and on behalf of Selling Shareholders by valid Powers
               of Attorney duly executed by the Selling Shareholders. This
               Agreement has been duly executed and delivered by the
               Attorneys-in-Fact for and on behalf of the Selling Shareholders
               and, assuming due authorization, execution and delivery by MRV
               and OIC, constitutes the legal, valid and binding obligation of
               the Selling Shareholders enforceable against the Selling
               Shareholders in accordance with its terms.

        5.1.2  The Selling Shareholders own their respective OIC Shares of
               record and beneficially, free and clear of any Encumbrances or
               restrictions. Provided that any Encumbrances over certain OIC
               Shares will be eliminated within twenty days after the execution
               of this Agreement. The Selling Shareholders have good title to
               their respective Shares and at the Closing, the Selling
               Shareholders shall deliver to MRV good title to their respective
               Shares free and clear of all Encumbrances, security interests,
               restrictions, and all other claims, rights and interests of third
               parties.

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<PAGE>   9

        5.1.3  OIC and the Selling Shareholders jointly and severally represent
               and warrant that OIC has full corporate power and authority,
               including all necessary approvals of its directors and
               shareholders, to execute and deliver this Agreement and to
               perform its obligations hereunder and to consummate the
               transactions contemplated hereby.

5.2     Organization and Capitalization

        Each of OIC and the Selling Shareholders jointly and severally represent
        and warrant that:

        5.2.1  Each of OIC and its Subsidiaries as set forth on Schedule 2 is a
               corporation duly organized, validly existing, and in good
               standing under the laws of their respective jurisdictions of
               their incorporation and has full corporate power and authority to
               conduct business and is in good standing under the laws of each
               jurisdiction where such qualification is required. Each of OIC
               and its Subsidiaries has full corporate power and authority and
               all material licenses, permits, and authorizations necessary to
               carry on the business in which it is now being engaged and to own
               and use the properties owned and used by it. Except as set forth
               in Schedule 3 or in the Financial Statements, neither OIC nor its
               Subsidiaries hold any shares of the capital stock or other equity
               interests of or investment in any other Person (other than bank
               accounts). OIC has delivered to MRV correct and complete copies
               of the charter and bylaws of OIC and each of its Subsidiaries (as
               amended to date). OIC and each of its Subsidiaries is not in
               default under or in violation of any provision of its charter or
               bylaws.

        5.2.2  The authorized capital stock of OIC consists of Forty-Five
               Million (45,000,000) shares of common stock with a par value of
               NT$10 per share, of which Forty Million (40,000,000) shares are
               issued and outstanding. All issued shares have been duly
               authorized, validly issued and are fully paid and non-assessable,
               with [no] preemptive rights. There are no outstanding
               obligations, options, warrants, preemptive rights or other
               agreements or commitments to which OIC or any of the Selling
               Shareholders is a party, or by which OIC or any of the Selling
               Shareholders is otherwise bound, providing for the issuance of
               any additional shares or for the repurchase of shares of OIC's
               capital stock. No shares of the capital stock of OIC are reserved
               for future issuance provided that only Forty Million (40,000,000)
               shares out of Forty-Five Million (45,000,000) shares are
               outstanding and issued.

        5.2.3  The Signing Shareholders listed in Schedule 1 own approximately
               Sixty percent (60%) of the issued and outstanding shares of
               capital stock of OIC. All of the information set out in Schedule
               1 is true, correct and complete.

5.3     Financial Condition

        Each of OIC and the Selling Shareholders jointly and severally represent
        and warrant that:

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<PAGE>   10

        5.3.1  OIC has delivered or shall deliver to MRV within Seven (7)
               Business Days prior to Closing consolidated financial statements
               of OIC and its Subsidiaries, which are collectively attached
               hereto as Schedule 4 consisting of (i) audited balance sheets and
               statements of income for the fiscal years ended December 31, 1997
               through 1999, (the "Financial Statements", the latest audited
               balance sheet being the "Audited" Balance Sheet"), and (ii)
               unaudited balance sheet and statements of income for the fiscal
               period ended March 31, 2000 (the "Latest Financial Statements",
               said balance sheet being the "Latest Balance Sheet"). The
               Financial Statements and the Latest Financial Statements
               (including the notes thereto) have been prepared in accordance
               with US GAAP applied on a consistent basis throughout the periods
               covered thereby and shall bear an unqualified opinion from the
               auditors. Except as explained in the notes thereto, the Audited
               Financial Statements and Latest Financial Statements fairly
               present the financial condition, assets, liabilities, equity and
               results of operations of OIC and each of its Subsidiaries as of
               their respective dates and periods, are and will be correct and
               complete in all material respects, and have been and will be
               prepared in accordance with generally accepted accounting
               principles applied on a consistent basis throughout the periods
               involved.

               OIC has obtained or will obtain a written consent by the Closing
               from the auditor (the "Auditor Consent") to include their opinion
               on the Financial Statements in order to comply with MRV's
               necessary filing with the SEC.

        5.3.2  The inventories of each of OIC and its Subsidiaries are not
               obsolete or damaged, are fit for their particular use, and are
               not defective, such that they are of a quantity and quality
               usable or saleable in the ordinary course of the business of OIC
               and its Subsidiaries for the amounts reflected on the Latest
               Balance Sheet, exclusive of any reserve allocable thereto,
               subject only to changes in the Ordinary Course of Business. All
               inventories reflected on the Latest Financial Statements are
               stated at not more than the lower of cost or fair market value
               thereof, with adjustments for obsolete, damaged or otherwise not
               readily marketable items. Set forth on Schedule 5 hereto is a
               complete list of the addresses of all warehouses or other
               facilities in which inventories of each of OIC and its
               Subsidiaries are located as of the date hereof.

        5.3.3  The accounts receivable of each of OIC and its Subsidiaries are
               valid receivables, collectible to the extent of the excess
               thereof over any reserves set forth on the Latest Balance Sheet,
               and are subject to no defenses, counterclaims or set-offs.

5.4     Absence of Undisclosed Liabilities. Each of OIC and the Selling
        Shareholders jointly and severally represent and warrant that each of
        OIC and its Subsidiaries has no liabilities or obligations (whether
        absolute, accrued, contingent or otherwise and whether due or to become
        due, including liabilities for taxes and interest and penalties thereon)
        except (i) the liabilities set forth on the Latest Balance Sheet and
        (ii) the liabilities and obligations set forth in Schedule 6 hereto.

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<PAGE>   11

5.5     Tax Returns

        Each of OIC and the Selling Shareholders jointly and severally represent
        and warrant that

        5.5.1  Each of OIC and its Subsidiaries has filed with the appropriate
               governmental agencies all required tax returns, is not in default
               with respect to any such filing, is not delinquent in payment of
               any taxes shown to be due on any such tax return or claimed to be
               due by any taxing authority, and has paid or made on the Latest
               Balance Sheet adequate provision or reserves for all taxes
               (including but not limited to, all income, withholding,
               corporate, excise, and value added taxes, real and personal
               property taxes, occupation taxes, social security taxes, and
               interest and penalties) payable by it, or attributable to all
               periods ending on or prior to the date of the Latest Balance
               Sheet. Each of OIC and its Subsidiaries has not given any waiver
               or extension of any period of limitation governing the time of
               assessment or collection of any tax. No deficiency in any tax
               payment is claimed by any tax authority for any taxable years of
               OIC and its Subsidiaries. There are no tax audits currently
               pending with respect to OIC and its Subsidiaries. To the best
               knowledge of any of the Selling Shareholders and OIC, there is no
               basis for assessment of any deficiency in any income taxes or any
               other taxes or governmental charges against each of OIC and its
               Subsidiaries.

        5.5.2  Neither OIC nor its Subsidiaries is a party to, and is not bound
               by, any tax indemnification agreement, tax sharing agreement or
               tax allocation agreement with any other person, firm, corporation
               or other entity, and neither OIC nor its Subsidiaries is
               responsible for any tax obligation or liability of any such other
               person, firm, corporation or other entity.

        5.5.3  Neither OIC nor any of its Subsidiaries has, or has at any time
               had, a taxable presence or permanent establishment in any country
               other than the Republic of China or each jurisdiction where it is
               incorporated, under the Applicable Laws of such country or under
               any Income Tax Treaty between that country and the Republic of
               China.

5.6     Absence of Certain Changes. Each of OIC and the Selling Shareholders
        jointly and severally represent and warrant that except as disclosed in
        Schedule 7 attached hereto, since the date of the Latest Balance Sheet,
        there has not been:

        (a)    any material adverse change in the financial condition, assets,
               liabilities, equity, operations, business or prospects of OIC and
               or any of its Subsidiaries;

        (b)    any obligation or liability incurred by OIC or any of its
               Subsidiaries other than obligations and liabilities incurred in
               the Ordinary Course of Business;

        (c)    any damage, destruction or loss, whether or not covered by
               insurance, materially or adversely affecting any material asset
               of OIC and its Subsidiaries;

        (d)    any Encumbrance placed on, or any claim, right or interest of
               any third party

                                       8
<PAGE>   12

               of any nature whatsoever asserted against, any material asset of
               OIC and its Subsidiaries;

        (e)    any purchase or sale or other disposition, or any agreement or
               other arrangement for the purchase or sale or other disposition,
               of any material asset of OIC and its Subsidiaries;

        (f)    any material change in the compensation or benefits payable or to
               become payable by OIC or its Subsidiaries to any of its employees
               or agents or any new bonus payment or arrangement or employee
               benefit made to or with any of them;

        (g)    any material change with respect to the management or supervisory
               personnel of OIC or any of its Subsidiaries;

        (h)    any dividend declared or paid or any other stockholder payment or
               distribution with respect to the OIC Shares or a purchase or
               redemption of any of the securities of OIC or any of its
               Subsidiaries or the execution of any agreement or commitment to
               do so; or

        (i)    any other event or condition of any character that may materially
               and adversely affect the financial condition , assets,
               liabilities, equity, operations, business or prospects of OIC or
               any of its Subsidiaries.

5.7     Real Property. Each of OIC and the Selling Shareholders jointly and
        severally represent and warrant that Schedule 8 sets forth a complete
        list of all real property owned or leased by either OIC or its
        Subsidiaries. Each of OIC and its Subsidiaries has valid legal rights
        to, or in the case of leased property, has valid leasehold interests, in
        all real properties. OIC or any of its Subsidiaries has valid and
        outstanding leasehold interests in all real property that it leases from
        others and the improvements situated thereon, all of which are listed
        and identified on the Schedule 8 hereto. All such real estate and
        improvements (including all buildings, or portions thereof, and all
        fixtures) are in good repair and operating condition, normal wear and
        tear and required maintenance (which has heretofore been regularly
        performed) excepted, are suitable and fit for the purposes for which
        they are currently being used, and are sufficient to conduct the
        business of OIC or any of its Subsidiaries as it is presently conducted.
        True , correct and complete copies of all leases, evidence of OIC
        interest in the real property, and all other instruments of title, or
        those of any of OIC's Subsidiaries and OIC's interest therein, with
        respect to all real property, leaseholds or other interests owned or
        held by OIC or any of its Subsidiaries have been delivered to MRV. The
        use and occupation of such real property and the improvements thereon by
        OIC or any of its Subsidiaries comply in all material respects with
        Applicable Law including zoning regulations and building codes.

5.8     Tangible Personal Property. Each of OIC and the Selling Shareholders
        jointly and severally represent and warrant that OIC and any of its
        Subsidiaries has good and marketable title to all of the tangible
        personal property which it owns, as reflected on the Latest Balance
        Sheet and Schedule 9 hereto (except as sold or otherwise disposed of or
        acquired in the Ordinary Course of Business or otherwise consistent with
        this Agreement). All machinery, equipment, furniture and fixtures, and

                                       9
<PAGE>   13

        computer hardware and software used by OIC or any of its Subsidiaries
        are in good operating condition and repair, normal wear and tear and
        required maintenance (which has heretofore been regularly performed)
        excepted, are suitable and fit for the purposes for which they are
        currently being used.

5.9     Intellectual Properties. Each of OIC and the Selling Shareholders
        jointly and severally represent and warrant that Schedule 10 hereto
        lists all of the Intellectual Properties, specifying in each case
        whether such Intellectual Properties rights are owned or used under
        license, as well as specifying whether OIC or any of its Subsidiaries
        act as licensor of any such Intellectual Properties Rights. All license
        agreements and all other instruments relating to licenses of any
        Intellectual Property Rights are described in Schedule 11, and true and
        complete copies thereof have been provided to MRV. None of the
        Intellectual Properties have been held or stipulated to be invalid in
        any litigation which has been concluded and the validity of none of the
        Intellectual Properties has been questioned in any litigation currently
        pending or, to the best knowledge of any Selling Shareholders and OIC,
        threatened. OIC and any of its Subsidiaries owns or possesses the
        Intellectual Properties necessary to manufacture and sell its products,
        and, to the best knowledge of any Selling Shareholders and/or OIC, such
        manufacture and sale does not infringe any rights of any other Person.
        OIC or any of its Subsidiaries, has not received any notice of conflict
        thereof with the asserted rights of any other Person, firm, corporation
        or other entity, and OIC or any of its Subsidiaries has the right to
        bring an action for any infringement of any of the Intellectual
        Properties.

5.10    Contracts. Each of OIC and the Selling Shareholders jointly and
        severally represent and warrant that there is no Contract:

        (a)    extending for a period of time longer than 12 months;

        (b)    involving expenditures or receipts by OIC or any of its
               Subsidiaries in excess of US$1.0 million (US$1,000,000);

        (c)    relating to the borrowing of money or guarantying any obligation
               for borrowed money or otherwise, other than endorsements for
               collection;

        (d)    with any insider or any affiliate;

        (e)    prohibiting or substantially restricting OIC or any of its
               Subsidiaries from freely engaging in business in any part of the
               world;

        (f)    with a sales agent or representative, dealer, or distributor; or

        (g)    any other contract, commitment or lease outside of the usual and
               Ordinary Course of Business,

        except such Contracts listed in Schedule 12 attached hereto.

5.11    Permits. Each of OIC and the Selling Shareholders jointly and severally
        represent and warrant that OIC and any of its Subsidiaries holds all of
        the Permits required by Applicable Law to own any and all of its assets,
        and to operate its business as that

                                       10
<PAGE>   14

        business is now conducted. Schedule 13 hereto contains a true and
        complete list of all such Permits. Except as specified on Schedule 14,
        all Permits are renewable in the Ordinary Course of Business and will
        remain in full force and effect following the Closing pursuant to this
        Agreement.

5.12    Compliance with Applicable Law and Permits. Each of OIC and the Selling
        Shareholders jointly and severally represent and warrant that OIC and
        any of its Subsidiaries are conducting, and has conducted, the business
        in compliance with all Applicable Laws and Permits, and has received no
        notice that it is in breach of any such Applicable Law or Permit. OIC or
        any of its Subsidiaries have not processed, stored, disposed,
        transported, handled, emitted, discharged, or released any Waste
        Material, whether on or off the real estate. Neither of Selling
        Shareholders has any knowledge or information or reason to believe that
        any Waste Material, tanks, containers, cylinders, drums or cans were
        buried on the real estate by OIC or any of its Subsidiaries or any other
        party during or preceding OIC or any of its Subsidiaries ownership or
        leasing of any real estate. OIC and any of its Subsidiaries have
        delivered to MRV copies of all internal or external environmental audit
        reports prepared by or for OIC or any of its Subsidiaries.

5.13    No Conflict. Each of OIC and the Selling Shareholders jointly and
        severally represent and warrant that neither the entering into nor the
        delivery of this Agreement nor the performance of the transactions
        contemplated therein by Selling Shareholders and OIC will result in the
        violation of:

        (a)    any of the provisions of the Articles of Incorporation, By-Laws
               and other constitutional documents of OIC;

        (b)    any Contract to which OIC or any Selling Shareholders, including
               OIC, is a party; or

        (c)    any Applicable Law or Permit.

        Except for satisfaction of any conditions specified in this Agreement,
        neither the Selling Shareholders nor OIC are required to give prior
        notice to, or obtain any consent, approval or authorization of, or make
        any declaration or filing with, any governmental authority, or any other
        person, firm, corporation or other entity in connection with the
        execution or delivery of this Agreement or the consummation of the
        transactions contemplated hereby.

5.14    No Encumbrances. Each of OIC and the Selling Shareholders jointly and
        severally represent and warrant that except as set forth in Schedules 15
        hereto, OIC and each of its Subsidiaries have good title to all of its
        assets which they owns, free and clear of all Encumbrances or any other
        claims, rights or interests of any other Person, firm, corporation or
        other entity of any nature whatsoever.

5.15    No Defaults. Each of OIC and the Selling Shareholders jointly and
        severally represent and warrant that OIC and any of its Subsidiaries has
        performed, or has taken all actions reasonably necessary to enable it to
        perform when due, all material obligations under all Contracts and
        Permits, all of which are in full force and effect, and there has not
        occurred any material default or other event which with the lapse

                                       11
<PAGE>   15

        of time or giving of notice or both may become a material default under
        any such Contract or Permit.

5.16    Litigation. Each of OIC and the Selling Shareholders jointly and
        severally represent and warrant that except as set forth on Schedule 16
        hereto, there are no claims, actions, suits or proceedings pending or,
        to the best knowledge of OIC and each of its Subsidiaries, threatened by
        or against OIC and each of its Subsidiaries or affecting it in any court
        or before any governmental or administrative authority. OIC or any of
        its Subsidiaries is subject to no decree, judgment, order or notice of
        any kind which enjoins or restrains it from taking any action of any
        kind whatsoever.

5.17    Employee and Labor Matters. Each of OIC and the Selling Shareholders
        jointly and severally represent and warrant that to the best knowledge
        of any Selling Shareholders and OIC, none of the key employees, and no
        group of employees of OIC or any of its Subsidiaries, plans to terminate
        his, her or their employment with OIC or any of its Subsidiaries. OIC
        and each of its Subsidiaries is not a party to any collective bargaining
        or union agreement. OIC and each of its Subsidiaries is in compliance in
        all material respects with all Applicable Law respecting employment and
        employment practices, terms and conditions of employment, and wages and
        hours. Since its incorporation, OIC or any of its Subsidiaries has
        experienced no significant union organization attempts and no material
        work stoppage due to any labor disagreement with respect to its
        business. There is no unfair labor practice charge or complaint against
        OIC or any of its Subsidiaries pending or, to the best knowledge of any
        Selling Shareholders and OIC, threatened, in any court or before any
        governmental or administrative authority. There is no labor strike,
        request for representation, slowdown or stoppage actually pending or to
        the best knowledge of OIC and any Selling Shareholders is threatened
        against or affecting OIC or any of its Subsidiaries.

5.18    Employee Benefits.

        Each of OIC and the Selling Shareholders jointly and severally represent
        and warrant that:

        5.18.1 OIC and each of its Subsidiaries have no employment, consulting,
               agency, commission, retirement, severance pay, non-competition,
               profit-sharing, deferred compensation or pension agreements or
               plans, or related practice, whether written or oral, formal or
               informal, other than as identified on Schedule 17 hereto (true,
               correct and complete copies of which have been delivered to MRV,
               including reasonably detailed summaries of any unwritten plans,
               arrangements or practices). All obligations of OIC and each of
               its Subsidiaries, whether arising by operation of law, by
               contract or by past custom, for payments by it with respect to
               unemployment compensation benefits, pension and retirement
               benefits, social security benefits, or other benefits for
               employees of OIC and any of its Subsidiaries, including but not
               limited to, those set forth on Schedule 19, in respect of periods
               prior to the Closing have been paid in full, or adequate
               provision therefor has been made in the Latest Balance Sheet.

        5.18.2 Upon termination by OIC or any of its Subsidiaries of the
               employment of

                                       12
<PAGE>   16

               any employee, OIC or any of its Subsidiaries shall not incur any
               liability for any severance or termination pay or other similar
               payment except as required by law expressly provided in the
               agreements or plans set forth on, or otherwise disclosed in
               Schedule 18.

        5.18.3 OIC or any of its Subsidiaries does not maintain, contribute to
               or have any liability under any funded or unfunded, medical,
               health or life insurance plan or arrangement for present or
               future retirees or present or future terminated employees except
               group insurance and as required by the Labor Insurance Act and
               the National Health Insurance Act.

5.19    Sufficient Assets. Each of OIC and the Selling Shareholders jointly and
        severally represent and warrant that the assets identified in this
        Agreement or on the Latest Balance Sheet constitute all of the tangible
        and intangible rights and assets necessary for the conduct of, or used
        or held by OIC and each of its Subsidiaries in connection with, its
        business and operations as they are presently being conducted.

5.20    Customers, Distributors and Suppliers. Each of OIC and the Selling
        Shareholders jointly and severally represent and warrant that Schedule
        19 hereto contains a true, correct and complete list of all
        distributors, representatives and agents of OIC and any of its
        Subsidiaries and a description of the terms of their relationships with
        OIC or with any of its Subsidiaries and a true, correct and complete
        list of all other persons to whom OIC and each of its Subsidiaries sold
        goods or services in the twelve months ended as of the date of this
        Agreement and by whom OIC or any of its Subsidiaries has been paid or
        who have committed to pay OIC or any of its Subsidiaries NT$[_______] or
        more since the beginning of said period. Schedule 20 contains a true,
        correct and complete list of all persons who provided goods or services
        to OIC or any of its Subsidiaries in the twelve months ended as of the
        date of this Agreement to which the Selling Shareholder has paid or is
        committed to pay NT$[________] or more since the beginning of said
        period. The relations of OIC and each of its Subsidiaries with the
        foregoing persons are good, and there are no disputes between OIC or any
        of its Subsidiaries and any of such persons pending or, to the best
        knowledge of any Seller and OIC or any of its Subsidiaries , threatened.
        True, correct and complete copies of all contracts with all of the
        foregoing persons have been delivered to MRV and are in full force and
        effect in accordance with their terms, and there are no defaults or
        allegations or claims of default thereunder.

5.21    Related Party Transactions. Each of OIC and the Selling Shareholders
        jointly and severally represent and warrant that except as set forth in
        Schedule 21 hereto or as contemplated by this Agreement, no the Selling
        Shareholder and no officer, or director of OIC or any of its
        Subsidiaries has any interest in any of the assets used or held by OIC
        in the conduct of its business or operations or is a party to any
        contract with OIC or any of its Subsidiaries or affecting the business
        or operations of OIC or any of its Subsidiaries.

5.22    Directors; Officers; Banks; and Powers of Attorney. Each of OIC and the
        Selling Shareholders jointly and severally represent and warrant that
        Schedule 22 hereto is a true and complete list showing: (a) the names of
        all of directors and officers of OIC and each of its Subsidiaries; (b)
        the name of each bank in which OIC and each of its Subsidiaries has an
        account or safety deposit box, and the names of all persons

                                       13
<PAGE>   17

        authorized to draw thereon or to have access thereto; and (c) the names
        of all persons holding powers of attorney from OIC and each of its
        Subsidiaries together with a summary statement of the terms thereof.

5.23    Insurance. Each of OIC and the Selling Shareholders jointly and
        severally represent and warrant that Schedule 23 hereto sets forth all
        existing insurance policies held by OIC and each of its Subsidiaries
        relating to its business. Each such policy is in full force and effect,
        is with responsible insurance carriers and is in an amount and scope
        customary for persons engaged in businesses and having assets similar to
        those of OIC and each of its Subsidiaries. All claims arising under such
        policies and all premiums that are due and payable thereunder have been
        paid in full.

5.24    Disclosure. No representation or warranty by the Selling Shareholders
        and/or OIC in this Agreement, and no certificate or statement furnished
        or to be furnished to MRV pursuant to this Agreement or in connection
        with the transactions contemplated hereby, contains or shall contain any
        untrue statement of material fact, or omits or shall omit to state a
        material fact necessary in order to make the statements contained herein
        and therein not misleading. There is no fact known to a Selling
        Shareholder or OIC which materially adversely affects, or in the future
        may (so far as can now be reasonably foreseen) materially adversely
        affect, OIC or any of its Subsidiaries, its financial condition its
        business or its prospects which has not been set forth in this Agreement
        or other information or material provided in writing by OIC to MRV.

5.25    Representations and Warranties Regarding Acquisition of MRV Shares. Each
        of the Selling Shareholders represents and warrants to MRV as follows:

        5.25.1 Disclosure; Access to Information. Each of the Selling
               Shareholders has received or will receive prior to the Closing
               all documents, records, books and other information pertaining to
               such Selling Shareholder's investment in MRV that have been
               requested by such Selling Shareholder, including the opportunity
               to ask questions and receive answers. MRV is subject to the
               periodic reporting requirements of the United States Securities
               Exchange Act of 1934 (the "Exchange Act"), and each of the
               Selling Shareholders has reviewed or received copies of any such
               reports filed by MRV with the SEC under the Exchange Act that
               have been requested by such Selling Shareholder.

        5.25.2 Manner of Sale. At no time were any of the Selling Shareholders
               presented with or solicited by or through any leaflet, public
               promotional meeting, television advertisement or any other form
               of general solicitation or advertising.

        5.25.3 Registration or Exemption Requirements. Each of the Selling
               Shareholders further acknowledges and understands that the MRV
               Shares may not be transferred, resold or otherwise disposed of in
               the United States except in a transaction registered under the
               United States Securities Act of 1933 (the "Securities Act") and
               any applicable state securities laws, or unless an exemption from
               such registration is available.

                                       14
<PAGE>   18

        5.25.4 No Legal, Tax or Investment Advice. Each of the Selling
               Shareholders understands that nothing in this Agreement or any
               other materials presented to the Selling Shareholders in
               connection with the purchase of MRV Shares constitutes legal, tax
               or investment advice. The Selling Shareholders have relied on,
               and have consulted with, such legal, tax and investment advisors
               as they, in their sole discretion, have deemed necessary or
               appropriate in connection with their purchase of the MRV Shares.

        5.25.5 No Registration, Review or Approval. Each Selling Shareholder
               acknowledges and understands that the offering and sale of MRV
               Shares pursuant to this Agreement has not been reviewed or
               approved by the SEC or by any state or other securities
               commission, authority or agency, and is not registered under the
               Securities Act or under the securities or "blue sky" laws, rules
               or regulations of any state. Each Selling Shareholder
               acknowledges, understands and agrees that the MRV Shares are
               being offered and sold hereunder pursuant to an offshore offering
               exemption to the registration provisions of the Securities Act
               pursuant to Regulation S promulgated under such Act. Each Selling
               Shareholder understand that MRV is relying upon the truth and
               accuracy of the representations, warranties, agreements,
               acknowledgments and understandings of such Selling Shareholder
               set forth herein in order to determine the applicability of such
               exemptions and the suitability of each Selling Shareholder to
               acquire the MRV Shares.

        5.25.6 Investment Intent. Without limiting its ability to resell the MRV
               Shares pursuant to an effective registration statement, or an
               exemption from such registration, each Selling Shareholder is
               acquiring the MRV Shares solely for its own account and not with
               a view to the distribution, assignment or resale to others. Each
               Selling Shareholder understands and agrees that it may bear the
               economic risk of its investment in the MRV Shares for an
               indefinite period of time.

        5.25.7 Offering Outside the United States. Each Selling Shareholder is
               not a "U.S. Person" as defined in Regulation S (as the same may
               be amended from time to time) promulgated under the Securities
               Act. At the time the buy order for this transaction was
               originated, each Selling Shareholder was outside the United
               States and no offer to purchase the MRV Shares was made in the
               United States. Each Selling Shareholder agrees not to reoffer or
               sell the MRV Shares, or to cause any transferee permitted
               hereunder to reoffer or sell the MRV Shares, within the United
               States, or for the account or benefit of a U.S. person, (i) as
               part of the distribution of the MRV Shares at any time, or (ii)
               otherwise, only in a transaction meeting the requirements of
               Regulation S under the Securities Act, including without
               limitation, where the offer (i) is not made to a person in the
               United States and either (A) at the time the buy order is
               originated, the Buyer is outside the United States or MRV and any
               person acting on its behalf reasonably believe that the buyer is
               outside the United States, or (B) the transaction is executed in,
               on or through the facilities of a designated offshore securities
               market and neither the seller nor any person acting on its behalf
               knows that

                                       15
<PAGE>   19

               the transaction has been pre-arranged with a buyer in the United
               States, and (ii) no direct selling efforts shall be made in the
               United States by the buyer, an affiliate or any person acting on
               their behalf, or in a transaction registered under the Securities
               Act or pursuant to an exemption from such registration.

        5.25.8 Regulation S Offering Transfer Restrictions. The transaction
               restrictions in connection with this offshore offer and sale
               restrict each Selling Shareholder from offering and selling to
               U.S. Persons, or for the account or benefit of a U.S. Person, for
               a period of time (the "Distribution Compliance Period"). The
               Distribution Compliance Period for the MRV Shares is one (1) year
               from the Closing.

        5.25.9 Legend. A legend substantially in the following form will be
               placed on any certificates or other documents evidencing the MRV
               Shares so as to restrict the resale, pledge, hypothecation or
               other transfer thereof in accordance with the provisions hereof
               and the provisions of Regulation S promulgated under the
               Securities Act:

               "THE SHARES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN
               REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (TOGETHER
               WITH THE REGULATIONS PROMULGATED THEREUNDER, THE "SECURITIES
               ACT"), AND MAY NOT BE SOLD, OFFERED FOR SALE, TRANSFERRED,
               PLEDGED OR HYPOTHECATED WITHIN THE UNITED STATES (AS THAT TERM IS
               DEFINED IN REGULATION S PROMULGATED UNDER THE SECURITIES ACT) OR
               TO A U.S. PERSON (AS THAT TERM IS DEFINED IN REGULATION S) IN THE
               ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FILED UNDER SAID
               ACT AND ANY APPLICABLE STATE SECURITIES LAWS, UNLESS AN EXEMPTION
               FROM SUCH REGISTRATION IS AVAILABLE. HEDGING TRANSACTIONS
               INVOLVING THESE SECURITIES MAY NOT BE CONDUCTED UNLESS IN
               COMPLIANCE WITH THE SECURITIES ACT."

       5.25.10 Permitted Offers and Sales. Offers and sales of MRV Shares prior
               to the expiration of the Distribution Compliance Period (or the
               effective date of the Registration Statement) may be made (only
               if otherwise so permitted by this Agreement) pursuant to the
               following conditions:

               (a)    The purchaser of the MRV Shares, other than a distributor,
                      certifies that it is not a U.S. Person and is not
                      acquiring the MRV Shares for the account or benefit of any
                      U.S. Person or is a U.S. Person who purchased the MRV
                      Shares in a transaction that did not require registration
                      under the Securities Act;

               (b)    The Purchaser of the MRV Shares agrees to sell such
                      securities only in accordance with Regulation S as
                      promulgated under the Securities Act, pursuant to
                      registration under the Securities Act, or pursuant to an
                      available exemption from registration; and agrees not to
                      engage in

                                       16
<PAGE>   20

                      hedging transactions with regard to such MRV Shares unless
                      in compliance with the Securities Act; and

               (c)    The MRV Shares contain a legend, substantially in the form
                      of Section 5.25.9 herein, to the effect that transfer of
                      the MRV Shares is prohibited except in accordance with
                      Regulation S, pursuant to registration under the
                      Securities Act, or pursuant to an available exemption from
                      registration; and that hedging transactions involving
                      those MRV Shares may not be conducted unless in compliance
                      with the Securities Act.

       5.25.11 No Hedging. Selling Shareholders agree not to engage in hedging
               transactions with respect to the MRV Shares prior to the
               expiration of the Distribution Compliance Period. For offers and
               sales of the MRV Shares prior to the expiration of the
               Distribution Compliance Period, such offering materials must
               state that hedging transactions involving those securities may
               not be conducted unless in compliance with the Securities Act and
               Regulation S promulgated thereunder.

        5.26   Brokers' Fees. Selling Shareholders shall be responsible to pay
               any fees or commissions to any broker or finder, with respect to
               the transactions contemplated by this Agreement for which the
               Selling Shareholders could be liable or obligated. MRV and the
               Escrow Agent shall not be responsible whatsoever with respect to
               such fees or commission.

        5.27   FTC Approval. OIC and Selling Shareholders warrant and represent
               that OIC's revenues and market share ratio do not reach or exceed
               the amount on percentage provided in the Fair Trade law as
               required to obtain the combination approval from the Fair Trade
               Commission (the "FTC Approval") of the Republic of China in order
               to complete the transactions contemplated in this Agreement.

6.      REPRESENTATIONS AND WARRANTIES OF MRV

MRV represents and warrants to OIC and the Selling Shareholders that the
statements contained in this Section 6 are correct and complete as of the date
of this Agreement and as of the Closing.

6.1     Organization of MRV. MRV is a corporation duly organized, validly
        existing, and in good standing under the laws of the jurisdiction of its
        incorporation.

6.2     Authorization of Transaction. MRV has full authority (including full
        corporate power and authority) to execute and deliver this Agreement and
        to perform its obligations hereunder. This Agreement constitutes the
        valid and legally binding obligation of MRV, enforceable in accordance
        with its terms and conditions. MRV need not give any notice to, make any
        filing with, or obtain any authorization, consent, or approval of any
        government or governmental agency in order to consummate the
        transactions contemplated by this Agreement other than the filings
        required by the Hart-Scott-Rodino Act.

                                       17
<PAGE>   21

6.3     Brokers' Fees. MRV has no Liability or obligation to pay any fees or
        commissions to any broker or finder with respect to the transactions
        contemplated by this Agreement for which MRV could become liable or
        obligated.

6.4     No Conflicts. Neither the execution and delivery of this Agreement nor
        the consummation by MRV of the transactions contemplated hereby will (i)
        violate any of the provisions of the by-law of MRV, (ii) violate any
        provision of Applicable Law, rule or regulation which violation would
        prevent MRV from being able to consummate the transactions contemplated
        by this Agreement, or (iii) conflict with or result in a breach of ,
        require consent under, give rise to a right of termination of, or
        accelerate the performance required by the terms of any judgement, court
        order or consent decree, or any agreement, indenture, mortgage or
        instrument to which MRV is a party or to which either of its property is
        subject, or constitute a default thereunder.

6.5     Capitalization; Validity of Securities. As of the date hereof and as of
        the Closing Date, all issued and outstanding ordinary shares of MRV are
        and will be duly authorized, validly issued, fully paid and
        non-assessable. The MRV Shares when issued and paid for in accordance
        with the terms and conditions of this Agreement, will be validly
        authorized, legally issued, fully paid and non-assessable, and the
        delivery to the Selling Shareholders pursuant to this Agreement shall
        vest in them good and marketable title thereto, free of any
        Encumbrances, except for restrictions on transfers set forth herein or
        imposed by law and except for any Encumbrance created by the Selling
        Shareholders themselves.

6.6     Reporting Company. MRV is a reporting company under Section 12 of the
        Exchange Act required to file periodic reports pursuant to Section 13 or
        15 of the Exchange Act and has timely filed all such periodic reports
        with the SEC during the past 12 months.

6.7     Approvals. No consent, approval, order, or authorization of, or
        registration, qualification, designation, declaration, or filing with,
        any governmental authority is required on the part of MRV in connection
        with the execution and delivery of this Agreement, the offer, issuance,
        sale, and delivery of the MRV Shares, or the other transactions to be
        consummated at the Closing, as contemplated by this Agreement, except
        such filings as shall have been made prior to and shall be effective on
        and as of the Closing (except for filings required under the
        Hart-Scott-Rodino Act or the United States securities laws or
        regulations or the regulations of the NASDAQ Stock Market or the
        Applicable Laws). Based on the representations made by the Selling
        Shareholders in Section 5 of this Agreement, the offer and sale of the
        MRV Shares to Selling Shareholders will be in compliance with applicable
        U.S. Federal and state securities laws.

6.8     Compliance. MRV is, in all material respects, in compliance with all
        laws, regulations, and orders applicable to its present business and has
        all permits and licenses required thereby where the failure to so be in
        compliance or to have such permits or licenses would be reasonable
        likely to materially adversely affect, the business, prospects,
        condition (financial or otherwise), affairs, or operations of MRV and
        its subsidiaries taken as a whole.

                                       18
<PAGE>   22

6.9     Disclosure. MRV has received, or will receive prior to the Closing, all
        documents, records, books or other information of OIC required to be
        filed with the Securities and Futures Commission (the "SFC") in the ROC
        in the year of 1999.

7.      PRE-CLOSING COVENANTS.

The Parties agree as follows with respect to the period between the execution of
this Agreement and the Closing:

7.1     General. Each of the Parties will use its best efforts to take all
        action and to do all things necessary, proper, or advisable in order to
        consummate and make effective the transactions contemplated by this
        Agreement (including satisfaction, but not waiver, of the closing
        conditions set forth in Section 8 below).

7.2     Approvals, Notices and Consents. Each of the Parties will shall use
        their best efforts to satisfy all Conditions Precedent to the Closing
        and will give any necessary notices to third parties, and will use its
        best efforts to obtain any necessary third party consents, that MRV
        reasonably may request in connection with the matters referred to in
        Section 5 above. Each of the Parties will (and will cause to) give any
        notices to, make any filings with, and use its best efforts to obtain
        any authorizations, consents, and all necessary Approvals. Without
        limiting the generality of the foregoing, the Selling Shareholders shall
        report the transfer of the OIC Shares to the SFC.

7.3     Operation of Business. OIC and each of its Subsidiaries will not engage
        in any practice or take any action outside the Ordinary Course of
        Business of or which results in a material adverse change in the
        business, financial condition, operations or results of operations of,
        except for actions to which MRV has given its prior consent.

7.4     Preservation of Business. OIC and each of its Subsidiaries will keep its
        business and properties substantially intact, including its present
        operations, physical facilities, working conditions, and relationships
        with lessors, licensors, suppliers, customers, and employees.

7.5     Reserved Matters

        Between the date hereof and Closing, the Selling Shareholders shall
        cause the managing team (directors, supervisors and Principal Employees
        of OIC) to procure that OIC and each of its Subsidiaries shall not
        without the prior consent in writing of MRV:

        (a)    enter into any transaction or incur any obligation or liability
               (absolute or contingent), except for current liabilities
               incurred, and contracts and transactions entered into, in the
               Ordinary Course of Business;

        (b)    dispose of or acquire any assets or properties or cancel any
               debts or claims, except in each case in the Ordinary Course of
               Business;

                                       19
<PAGE>   23

        (c)    increase any benefits to employees under pension, insurance or
               other employee benefit programs or enter into any deferred
               compensation agreement with any of its directors, officers or
               employees except for increase in compensation for employees and
               probationary employees for which OIC or any of its Subsidiaries
               is contractually bound to give;

        (d)    enter into an agreement to do any of the things described in
               Section 5.10;

        (e)    cease to pay its creditors in the Ordinary Course of Business;

        (f)    repay any loan capital in whole or in part (other than
               indebtedness to its bankers) or become bound or liable to be
               called upon to repay prematurely any loan capital or borrowed
               moneys;

        (g)    declare any dividend or pass any resolutions or do anything in
               the conduct or management of the affairs of either OIC or any of
               its Subsidiaries which would be likely materially to reduce the
               value of the business;

        (h)    suffer any material adverse change in its financial condition,
               assets, business, properties, liabilities, earnings, operations,
               affairs or prospects;

        (i)    waive or release any right of a material or substantial value
               howsoever arising;

        (j)    incur any capital expenditure or make any capital commitment of
               an amount in excess of US$1.0 million (US$1,000,000) or dispose
               of any fixed assets having a value of more than US$1.0 million
               (US$1,000,000) in aggregate;

        (k)    make any purchase or sale or introduce any method of management
               or operation in respect of the business except in a manner
               consistent with proper prior practice;

        (l)    discharge or satisfy any lien or encumbrance or any other
               obligation or liability (absolute or contingent) other than
               liabilities in the Ordinary Course of Business;

        (m)    pass any resolution the result of which would be its winding up,
               liquidation or receivership, or make any composition or
               arrangement with creditors;

        (n)    carry on any business other that the business or otherwise change
               the nature or geographical area of its business;

        (o)    enter into any partnership or joint venture arrangement or set up
               any subsidiary or associated company;

        (p)    create any fixed or floating charge, lien (other than a lien
               arising by operation of law) or other encumbrance over the whole
               or any part of its undertaking, property or assets;

        (q)    undertake anything which would require accounting treatment by
               way of provision, reserve or extraordinary item;

                                       20
<PAGE>   24

        (r)    make, amend or terminate any contract, loan, guarantee or other
               arrangement with any Selling Shareholders or any of their
               respective Affiliates;

        (s)    make, amend or terminate any long-term, unusual or onerous
               contract (long-term meaning a contract under which the
               obligations of any party thereto may remain outstanding for more
               that twelve (12) months) or take any action which could, as a
               consequence of any action taken by another party, result in any
               of the same.

7.6     Full Access. OIC and each of its Subsidiaries will permit
        representatives of MRV to have full access on a confidential basis at
        all reasonable times, and in a manner so as not to interfere with the
        normal business operations of, to all premises, properties, personnel,
        books, records (including Tax records), contracts, and documents of or
        pertaining to;

7.7     Notice of Developments. OIC and each of its Subsidiaries will give
        prompt written notice to MRV of any material adverse development causing
        a breach of any of the representations and warranties in Section 5
        above. Each Party will give prompt written notice to the others of any
        material adverse development causing a breach of any of its own
        representations and warranties in Sections 5 and 6 above.

7.8     Exclusivity. OIC and each of its Subsidiaries will not solicit,
        initiate, or encourage the submission of any proposal or offer from any
        other Person relating to the acquisition of any capital stock or other
        voting securities, or any substantial portion of the assets, of
        (including any acquisition structured as a merger, consolidation or
        share exchange).

7.9     Supervisor. OIC and Selling Shareholders agree that they will fully
        cooperate with MRV to have one of the existing supervisor of OIC being
        replaced by a person designated by MRV ("Nominee Supervisor") for
        purpose of conducting the special shareholders meeting to elect the new
        directors and supervisors and to conduct other necessary corporate
        actions after the Closing. MRV agrees that it shall cause Nominee
        Supervisor to resign from its position in the event that the Closing is
        not completed prior to Target Date or any other date as agreed by the
        Parties.

7.10    OIC and Selling Shareholders agree to confirm to MRV within one month of
        execution of this Agreement the definite list of the name and number of
        shares of Selling Shareholders and shall have all the Selling
        Shareholders agree to be a Party of this Agreement and bear the same
        obligations and liabilities as the Signing Shareholders under this
        Agreement and Escrow Agreement and issue a Power of Attorney in the form
        attached as Exhibit A to authorize the Attorneys-in-Fact to sign this
        Agreement and perform their obligations hereunder on their behalf in
        connection with their respective OIC Shares.

7.11    The Parties shall each use their best efforts to procure the fulfillment
        of the conditions set forth in Section 8 hereof on or before the
        Closing, and in particular, shall furnish such information, supply such
        documents, and do all such acts and things as may be required to enable
        such conditions to be fulfilled.

                                       21
<PAGE>   25

7.12    The Selling Shareholders and OIC shall cause any personal or corporate
        guarantors who provide Guaranties on the indebtedness or other
        obligations of OIC or any of its Subsidiaries to continually provide
        guaranties over the same after the execution of this Agreement in
        accordance with the current terms thereof.

7.13    At least five (5) Business Days prior to the Closing, the Selling
        Shareholders (or Attorney(s)-in-Fact or OIC in whose name the Taiwan
        Account shall be registered) shall give the Taiwan Account passbook,
        chops and the Power-of-Attorney-Form B to Closing Agent.

7.14    The Selling Shareholders shall sign through their duly authorized
        representative (i) an Escrow Agreement with the Escrow Agent as
        described in Section 10.2.3; and (ii) any other documents required in
        this Agreement or in the Escrow Agreement.

7.15    The Selling Shareholders (or Attorney(s)-in-Fact or OIC in whose name
        the Taiwan Account shall be registered) shall, at least five (5)
        Business Days prior to the Closing, give the Taiwan Account passbook,
        chops and a Power of Attorney-Form B to the law firm of Baker &
        McKenzie, Taipei Office as the Closing Agent of Selling Shareholders
        (the "Closing Agent") granting said Closing Agent the exclusive right to
        give instructions to the bank with respect to the Taiwan Account.

7.16    Within twenty (20) days after the execution of this Agreement, OIC and
        the Selling Shareholders shall be responsible to implement and provide a
        list of Principal Employees (as defined and discussed below) which shall
        include the key employees in the technical team of OIC and each of its
        Subsidiaries. Such list shall be incorporated into this Agreement as
        Schedule 24. OIC and the Signing Shareholders shall be responsible to
        implement and provide any other necessary information to be contained in
        the Schedules relating to the warranties and representations described
        in Section 5 of this Agreement.

7.17    MRV shall provide the Attorneys-in-Fact copies of its most recent public
        filings with the SEC (including MRV's most recent available financial
        statements) within two weeks of the execution of this Agreement.

8.      CONDITIONS PRECEDENT TO CLOSING

8.1     Conditions to Obligation of MRV. The obligation of MRV to consummate the
        transactions to be performed by it in connection with the Closing is
        subject to satisfaction of the following conditions:

        8.1.1  OIC and the Selling Shareholders shall have complied with all of
               their respective agreements and covenants contained herein to be
               performed at or prior to the Closing, and all their
               representations and warranties contained herein shall be true and
               accurate on and as of the Closing Date with the same effect as
               though made on and as of the Closing Date, except that
               representations and warranties that were made as of a specified
               date shall continue on the Closing Date to have been true as of
               the specified date, and MRV shall have received a certificate of
               the Selling Shareholders and OIC, dated as of the Closing Date,
               substantially in the form of Exhibit C

                                       22
<PAGE>   26

               certifying as to the fulfillment of the condition set forth in
               this Section 8.1.1 (the "OIC's Bring-Down Certificate").

        8.1.2  MRV shall have received the written agreement (in the form
               attached as Exhibit E) of the "Principal Employees" of OIC and
               each of its Subsidiaries to continue in the employment of said
               companies for a period of at least two (2) years after the
               Closing Date on mutually agreed upon salary and benefit terms
               (including the stock option plan) and on such other terms as MRV
               normally requires of its employees. In any event, their salary
               and other cash benefits shall be no more than those of the year
               of 1999. For this purpose, the following individuals are deemed
               to be "Principal Employees" of OIC and its Subsidiaries:
               Dr. C.J. Hwang, Spencer Wu, Dr. Zuon-Min Chuang, Jow Ming-Yong,
               and any other Principal Employees whose names are shown in
               Schedule 24.

        8.1.3  No statute, rule or regulation, or order of any court or
               administrative agency shall be in effect which restrains or
               prohibits from consummating the transaction contemplated hereby.

        8.1.4  No material action, suit or proceeding before any court or any
               governmental body or authority against the Selling Shareholders,
               either OIC or its Subsidiaries, or pertaining to the transactions
               contemplated by this Agreement or their consummation, shall have
               been instituted on or before the Closing Date.

        8.1.5  The Approvals and all necessary agreements and consents of any
               third parties which OIC is required to obtain, shall have been
               obtained, and true and complete copies thereof delivered to MRV.

        8.1.6  Each Encumbrance or obligation to create any Encumbrance, if any,
               on OIC Shares shall have been terminated and released prior to
               the Closing Date, and the Selling Shareholders shall have
               provided evidence, in form and substance satisfactory to MRV, of
               such termination and release.

        8.1.7  During the Closing, there shall not have occurred any event or
               condition materially and adversely affecting the assets or the
               financial condition, results of operations or business prospects
               of OIC or any of its Subsidiaries from those reflected in the
               Financial Statements, except as disclosed in this Agreement or
               the Schedules hereto.

        8.1.8  The Selling Shareholders and OIC shall have delivered to MRV at
               the Closing each agreement, instrument, certificate and document
               required by this Agreement and the Financial Statements, the
               Latest Financial Statements, and the Auditor Consent as required
               by Section 5.3.1 of this Agreement, and Selling Shareholders'
               Payment shall be received by MRV during the Closing.

        8.1.9  OIC Shares available for sale to MRV in accordance with the terms
               of this Agreement shall be not less than seventy-five percent
               (75%).

                                       23
<PAGE>   27

        8.1.10 All final due diligence results on OIC and its Subsidiaries are
               satisfactory to MRV.

        MRV may waive any condition specified in this Section 8.1 if it executes
        a writing so stating at or prior to the Closing.

8.2     Conditions to Obligation of the Selling Shareholders. The obligation of
        the Selling Shareholders to consummate the transactions to be performed
        by it in connection with the Closing is subject to satisfaction of the
        following conditions:

        8.2.1  MRV and its Subsidiaries shall have complied with all of its
               agreements and covenants contained herein to be performed at or
               prior to the Closing, and all their representations and
               warranties contained herein shall be true and accurate on and as
               of the Closing Date with the same effect as though made on and as
               of the Closing Date, except that representations and warranties
               that were made as of a specified date shall continue on the
               Closing Date to have been true as of the specified date and
               Selling Shareholders shall have received a certificate dated as
               of the Closing Date, substantially in the form of Exhibit D
               certifying as to the fulfillment of the condition set forth in
               this Section (the "MRV's Bring-Down Certificate").

        8.2.2  No statute, rule or regulation, or order of any court or
               administrative agency shall be in effect which restrains or
               prohibits the Parties from consummating the transaction
               contemplated hereby.

        8.2.3  The Approvals and all necessary agreements and consents of any
               third parties shall have been obtained and true and complete
               copies thereof delivered to Selling Shareholders

        8.2.4  MRV's Payment shall, via Closing Agent, be made to
               Attorneys-in-Fact for and on behalf of Selling Shareholders
               during the Closing.

        Selling Shareholders may waive any condition specified in this Section
        8.2 if it executes a writing so stating at or prior to the Closing.

9.      POST CLOSING COVENANTS

9.1     OIC and the Selling Shareholders agree that they will fully cooperate
        with MRV to convene all necessary corporate actions including but not
        limited to holding the shareholders meetings and the directors meetings
        to elect the new directors and Supervisors and to amend the article of
        incorporation, if necessary.

9.2     OIC and the Selling Shareholders agree that they will fully cooperate
        with MRV for a period of one year from the Closing Date to manage the
        operation and business conducted by OIC and each of its Subsidiaries.

9.3     OIC and Selling Shareholders agree that they will fully cooperate with
        MRV and use their best efforts to obtain further additional consents
        from the auditors on the Financial Statements to include auditor's
        reports in other filing to be made by MRV

                                       24
<PAGE>   28

        with the SEC as necessary from time to time.

9.4     MRV agrees to file a registration statement with the U.S. Securities and
        Exchange Commission (the "SEC") within appropriate days as reasonably
        determined by MRV following the Closing to register the MRV Shares to be
        issued to the Selling Shareholders under the transaction hereunder and
        exercise its best efforts to obtain as soon as practicable an effective
        registration statement aimed to release the Selling Shareholders from
        the resale restriction imposed by the Regulation S under the Securities
        Act of 1933, as amended. Provided however, MRV does not guarantee the
        successful registration and the time period required to obtain such
        successful registration.

10.     INDEMNIFICATION AND ESCROW

10.1    Survival of Representations and Warranties

        All of the representations and warranties contained in Sections 5 and 6
        above, shall survive the Closing hereunder (even if MRV knew or had
        reason to know of any misrepresentation or breach of warranty at the
        time of Closing) and continue in full force and effect for a period of
        two (2) years thereafter (subject to any applicable statutes of
        limitations). Provided however, OIC's liabilities concerning the said
        representations and warranties may be waived under the discretion of MRV
        without releasing the liabilities of the Signing Shareholders.

10.2    Indemnification Provisions

        10.2.1 MRV shall indemnify, defend and hold harmless the Selling
               Shareholders against any and all losses that any of them may
               suffer, sustain or become subject to as a result of any breach by
               MRV of its warranties, representations, agreements or covenants
               set forth in this Agreement.

        10.2.2 In the event that OIC or any of the Selling Shareholders breaches
               any of their covenants in Sections 7 and 9 above or any of its
               representations and warranties in Section 5 above or any other
               obligations set forth in this Agreement other than those
               contained in Section 13.18 for which the relevant Party shall be
               responsible, and, if there is an applicable survival period
               pursuant to Section 10.1 above, provided that MRV makes a written
               claim for indemnification against the Selling Shareholders and/or
               OIC, then the Selling Shareholders (or, in the case of Section
               13.18, the relevant responsible Party only), and OIC agree to
               jointly and severally indemnify MRV from and against the entirety
               of any Adverse Consequences MRV may suffer through and after the
               date of the claim for indemnification (including any Adverse
               Consequences MRV may suffer after the end of any applicable
               survival period) resulting from, arising out of, relating to, in
               the nature of, or caused by the breach.

               The Parties agree that the maximum indemnification of liabilities
               of each Selling Shareholder shall not exceed the total
               consideration he is entitled to receive from this transaction.

                                       25
<PAGE>   29

        10.2.3 Escrow. The Parties agree the following:

               (a)    the representations, warranties, covenants and obligations
                      of the Selling Shareholders shall be secured by placing
                      Six Hundred and Eighty Thousand (680,000) MRV Shares owned
                      by the Selling Shareholders in escrow (the "Escrowed
                      Shares") for two years under an Escrow Agreement in the
                      form attached hereto as Exhibit F (the "Escrow
                      Agreement"). In the event that payment is required to MRV
                      as a result of invocation of the indemnification clauses
                      of this Agreement, the Escrowed Shares shall be taken from
                      the escrow account and delivered to MRV pro rata to the
                      shareholding of the Selling Shareholders in MRV Shares or
                      as shall otherwise be agreed among the Selling
                      Shareholders.

                      Notwithstanding the above, in the event that less than
                      100% of OIC Shares sold and delivered to MRV, the number
                      of Escrowed Shares shall be adjusted down by the same
                      percentage as those OIC Shares not available for sale are
                      as a percentage of the total OIC Shares of outstanding on
                      the date of execution of this Agreement.

               (b)    The Parties shall appoint the firm of Baker & McKenzie,
                      Taipei office, with David T. Liou as its representative,
                      as escrow agent (the "Escrow Agent") to proceed pursuant
                      to the Escrow Agreement.

               (c)    The relevant escrow fees ("Escrow Fees") as described in
                      the Escrow Agreement shall be shared equally between the
                      Selling Shareholders and MRV. The Selling Shareholder's
                      half has been deducted from the MRV Shares being
                      transferred to the Selling Shareholders, and therefore MRV
                      shall pay the entire Escrow Fee to the Escrow Agent on or
                      before Closing.

               (d)    Except for the Escrow Shares belonging to Principal
                      Employees the Parties agree that one-third (1/3) of the
                      Escrowed Shares, or the Escrowed Shares remaining after
                      any call down exercised by MRV under this Article 10,
                      shall be released by the Escrow Agent to the Selling
                      Shareholders on the date which is one calendar year
                      following the Closing date. The remainder of the Escrow
                      Shares remaining at the end of the escrow period shall be
                      released on the date that is two calendar years after the
                      Closing Date.

10.3    Matters Involving Third Parties

        10.3.1 If any third party shall notify any Party (the "Indemnified
               Party") with respect to any matter (a "Third Party Claim") which
               may give rise to a claim for indemnification against any other
               Party (the "Indemnifying Party") under this Section 10, then the
               Indemnified Party shall promptly notify each Indemnifying Party
               thereof in writing; provided, however, that no delay on the part
               of the Indemnified Party in notifying any Indemnifying Party
               shall relieve the Indemnifying Party from any obligation
               hereunder unless (and

                                       26
<PAGE>   30

               then solely to the extent) the Indemnifying Party thereby is
               prejudiced.

        10.3.2 Any Indemnifying Party will have the right to defend the
               Indemnified Party against the Third Party Claim with counsel of
               its choice reasonably satisfactory to the Indemnified Party so
               long as (A) the Indemnifying Party notifies the Indemnified Party
               in writing within fifteen (15) days after the Indemnified Party
               has given notice of the Third Party Claim that the Indemnifying
               Party will indemnify the Indemnified Party from and against the
               entirety of any Adverse Consequences the Indemnified Party may
               suffer resulting from, arising out of, relating to, in the nature
               of, or caused by the Third Party Claim, (B) the Indemnifying
               Party provides the Indemnified Party with evidence reasonably
               acceptable to the Indemnified Party that the Indemnifying Party
               will have the financial resources to defend against the Third
               Party Claim and fulfill its indemnification obligations
               hereunder, (C) the Third Party Claim involves only money damages
               and does not seek an injunction or other equitable relief, (D)
               settlement of, or an adverse judgment with respect to, the Third
               Party Claim is not, in the good faith judgment of the Indemnified
               Party, likely to establish a precedential custom or practice
               materially adverse to the continuing business interests of the
               Indemnified Party, and (E) the Indemnifying Party conducts the
               defense of the Third Party Claim actively and diligently.

        10.3.3 So long as the Indemnifying Party is conducting the defense of
               the Third Party Claim in accordance with Section 10.3.2 above,
               (A) the Indemnified Party may retain separate co-counsel at its
               sole cost and expense and participate in the defense of the Third
               Party Claim, (B) the Indemnified Party will not consent to the
               entry of any judgment or enter into any settlement with respect
               to the Third Party Claim without the prior written consent of the
               Indemnifying Party, and (C) the Indemnifying Party will not
               consent to the entry of any judgment or enter into any settlement
               with respect to the Third Party Claim without the prior written
               consent of the Indemnified Party.

        10.3.4 In the event any of the conditions in Section 10.3.2 above is or
               becomes unsatisfied, however, (A) the Indemnified Party may
               defend against, and consent to the entry of any judgment or enter
               into any settlement with respect to, the Third Party Claim in any
               manner it reasonably may deem appropriate (and the Indemnified
               Party need not consult with, or obtain any consent from, any
               Indemnifying Party in connection therewith), (B) the Indemnifying
               Parties will reimburse the Indemnified Party promptly and
               periodically for the costs of defending against the Third Party
               Claim (including reasonable attorneys' fees and expenses), and
               (C) the Indemnifying Parties will remain responsible for any
               Adverse Consequences the Indemnified Party may suffer resulting
               from, arising out of, relating to, in the nature of, or caused by
               the Third Party Claim to the fullest extent provided in this
               Section 10.

                                       27
<PAGE>   31

11.     TERMINATION.

11.1    Termination of Agreement. Certain of the Parties may terminate this
        Agreement as provided below:

        11.1.1 The Parties may terminate this Agreement by mutual written
               consent at any time prior to the Closing; and

        11.1.2 Either party to this Agreement may terminate this Agreement by
               giving written notice to the other party if the Closing shall not
               have occurred on or before Target Day, except that the right to
               terminate this Agreement pursuant to this Section 11 shall not be
               available to (A) OIC or the members of the Selling Shareholders
               if the failure to consummate the Closing on or before such date
               was caused by or resulted from the failure of any member of
               Selling Shareholders or OIC to fulfill any of its obligations
               under this Agreement or (B) MRV if the failure to consummate the
               Closing on or before such date was caused by or resulted from
               MRV's failure to fulfill any of its obligations under this
               Agreement.

11.2    Effect of Termination. If any Party terminates this Agreement pursuant
        to Section 11.1 above, all further obligations of the Parties hereto
        shall become null and void and no party shall have any liability to any
        other party, unless the basis for such termination was the failure by
        such party to fulfill its covenants and agreements set forth herein. In
        the event that the Closing is not completed, either Party will destroy
        or return to the other Party the Confidential Information of the other
        Party.

12.     TRANSFER RESTRICTION

Each of the Selling Shareholders agree that the Selling Shareholders shall not
sell the MRV Shares in a group at one time more than one hundred thousand
(100,000) shares. Such grouped sales shall be further restricted to a total of
one hundred thousand (100,000) shares in any given month. This restriction does
not apply if a Selling Shareholder is selling the MRV Shares alone and not in
concert in any way with any other Selling Shareholders.

13.     MISCELLANEOUS

13.1    Press Releases and Public Announcements

        No Party shall issue any press release or make any public announcement
        relating to the subject matter of this Agreement prior to the Closing
        without the prior written approval of the other Party and ; provided,
        however, that any Party may make any public disclosure it believes in
        good faith is required by Applicable Law or any listing or trading
        requirement concerning its publicly-traded securities (in which case the
        disclosing Party will notify the other Parties of such disclosure
        forty-eight (48) hours prior to making the disclosure).

13.2    No Third-Party Beneficiaries. This Agreement shall not confer any rights
        or

                                       28
<PAGE>   32

        remedies upon any Person other than the Parties and their respective
        successors and permitted assigns.

13.3    Notices

        All notices and other communications required or permitted under this
        Agreement shall be in writing and shall be sent by facsimile
        transmission to the other parties at the fax number set forth below for
        MRV (in the case of a notice to be sent to MRV) or for OIC (in the case
        of notices to be sent to OIC or the Selling Shareholders prior to the
        Closing--after the Closing they shall designate a representative and
        provide a fax number for this purpose), with a copy sent by first class
        mail or express courier to said parties at the address provided to the
        other parties, or to such other fax number and/or address as a party may
        hereinafter designate by notice to the other. Notice shall be effective
        on the date it is sent by facsimile transmission if the facsimile
        transmission report confirms receipt by the receiving fax.

            -    To OIC
                 Attention: Dr. C.J. Hwang
                 Fax: 886-3-5790289

            -    To MRV
                 Attention: Edmund Glazer
                 Fax: (1-978) 952-4795

            -    To Selling Shareholders
                 Attention: Dr. C.J. Hwang
                 Fax: 886-3-5790289

13.4    Headings

        The headings contained in this Agreement (including but not limited to
        the titles of the Schedules and Exhibits hereto) have been inserted for
        convenience of reference only, and neither such headings nor the
        placement of any term hereof under any particular heading shall in any
        way restrict or modify any of the terms or provisions hereof. Terms used
        in the singular shall be read in the plural, and vice versa, and terms
        used in the masculine gender shall be read in the feminine or neuter
        gender when the context so requires.

13.5    Schedules, Exhibits and Annexes

        All Schedules, Exhibits and Annexes attached to this Agreement
        constitute an integral part of this Agreement as if fully rewritten
        herein.

13.6    Entire Agreement

        This Agreement (including the documents referred to herein) constitutes
        the entire agreement among the Parties and supersedes any prior
        understandings, agreements, or representations by or among the Parties,
        written or oral, to the extent they related in any way to the subject
        matter hereof.

                                       29
<PAGE>   33

13.7    Succession and Assignment

        This Agreement shall be binding upon and inure to the benefit of the
        Parties named herein and their respective successors and permitted
        assigns. No Party may assign either this Agreement or any of its rights,
        interests, or obligations hereunder without the prior written approval
        of the other Party and; provided, however, that MRV may (i) assign any
        or all of its rights and interests hereunder to one or more of its
        Affiliates and (ii) designate one or more of its Affiliates to perform
        its obligations hereunder (in any or all of which cases MRV nonetheless
        shall remain responsible for the performance of all of its obligations
        hereunder).

13.8    Counterparts

        This Agreement may be executed in one or more counterparts, each of
        which shall be deemed an original but all of which together will
        constitute one and the same instrument.

13.9    GOVERNING LAW

        THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
        LAWS OF TAIWAN, THE REPUBLIC OF CHINA.

13.10   Amendments and Waivers

        No amendment of any provision of this Agreement shall be valid unless
        the same shall be in writing and signed by the Parties. No waiver by any
        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 such occurrence.

13.11   Severability

        Any term or provision of this Agreement that is invalid or unenforceable
        in any situation in any jurisdiction shall not affect the validity or
        enforceability of the remaining terms and provisions hereof or the
        validity or enforceability of the offending term or provision in any
        other situation or in any other jurisdiction.

13.12   Cost and expenses

        Except this Agreement provides otherwise, each of the Parties shall bear
        its own costs and expenses (including but not limiting to legal fees and
        expenses) incurred in connection with this Agreement and the
        transactions contemplated hereby.

13.13   Construction

        The Parties have participated jointly in the negotiation and drafting of
        this Agreement. In the event an ambiguity or question of intent or
        interpretation arises, this Agreement shall be construed as if drafted
        jointly by the Parties and no

                                       30
<PAGE>   34

        presumption or burden of proof shall arise favoring or disfavoring any
        Party by virtue of the authorship of any of the provisions of this
        Agreement. Any reference to any federal, state, local, or foreign
        statute or law shall be deemed also to refer to all rules and
        regulations promulgated thereunder, unless the context requires
        otherwise. The word "including" shall mean including without limitation.
        The Parties intend that each representation, warranty, and covenant
        contained herein shall have independent significance. If any Party has
        breached any representation, warranty, or covenant contained herein in
        any respect, the fact that there exists another representation,
        warranty, or covenant relating to the same subject matter (regardless of
        the relative levels of specificity) which the Party has not breached
        shall not detract from or mitigate the fact that the Party is in breach
        of the first representation, warranty, or covenant.

13.14   Specific Performance

        Each of the Parties acknowledges and agrees that the other Parties would
        be damaged irreparably in the event any of the provisions of this
        Agreement are not performed in accordance with their specific terms or
        otherwise are breached. Accordingly, each of the Parties agrees that,
        the other Parties shall be entitled to an injunction or injunctions to
        prevent breaches of the provisions of this Agreement and to enforce
        specifically this Agreement and the terms and provisions hereof in any
        action instituted in any court of Taiwan, the Republic of China or any
        other state thereof having jurisdiction over the Parties and the matter,
        in addition to any other remedy to which they may be entitled, at law or
        in equity.

13.15   Submission to Jurisdiction

        Any dispute relating to the validity, performance, construction or
        interpretation of this Agreement that cannot be resolved amicably among
        the Parties shall be submitted to the jurisdiction of the Taipei
        District Court in any action or proceeding arising out of or relating to
        this Agreement and agrees that all claims in respect of the action or
        proceeding may be heard and determined in any such court. Each Party
        further agrees not to bring any action or proceeding arising out of or
        relating to this Agreement in any other court. Each of the Parties
        waives any defense of inconvenient forum to the maintenance of any
        action or proceeding so brought and waives any bond, surety, or other
        security that might be required of any other Party with respect thereto.
        Any Party may make service on any other Party by sending or delivering a
        copy of the process to the Party to be served at the address and in the
        manner provided for the giving of notices in Section 13.3 above. Nothing
        in this Section 13.15, however, shall affect the right of any Party to
        serve legal process in any other manner permitted by law or at equity.
        Each Party agrees that a final judgment in any action or proceeding so
        brought shall be conclusive and may be enforced by suit on the judgment
        or in any other manner provided by law or at equity.

13.16   Attorney's Fees

        In the event that a party to this Agreement commences any legal action
        under this Agreement to enforce any of its rights hereunder, or to
        recover damages for any breach or default by the other party or parties
        hereto of any of its (their) obligations

                                       31
<PAGE>   35

        hereunder, the prevailing party in any such legal action shall be
        entitled to recover from the other party all of its costs and expenses
        incurred in connection with such legal action, including reasonable
        attorneys' fees,

13.17   Confidential Information

        OIC and each of Selling Shareholders and MRV shall:-

        (a)    not use or disclose to any person Confidential Information; and

        (b)    use all reasonable endeavours to prevent the use or disclosure of
               Confidential Information by any person.

        This Section 13.17 does not apply to:-

        (a)    use or disclosure of Confidential Information required to be
               disclosed by law, regulation or any revenue authority;

        (b)    disclosure of Confidential Information to professional advisers
               for the purpose of advising MRV or Selling Shareholders; or

        (c)    Confidential Information which is in the public domain other than
               as a consequence of a breach of this Section 13.17.

13.18   Non-Competition

       13.18.1 The Selling Shareholders hereby undertake (except as otherwise
               agreed in writing with MRV) not to, either solely or jointly with
               any other Person (either on their own account or as the agent of
               any other Person) for a period of one (1) year from Closing carry
               on or be engaged or concerned or (except as the holder of shares
               in a listed company which confer not more than twelve percent of
               the votes which can generally be cast at a general meeting of the
               company), interested, or, for legal entity members of the Selling
               Shareholders, hold more than twelve percent of the shares
               (natural person members of the Selling Shareholders may not hold
               any such shares) directly or indirectly in a business which
               competes with the type of business carried on by OIC or its
               Subsidiaries at Closing in the world. This restriction shall not
               apply to any currently held investments of the Selling
               Shareholders set out in Schedule 25 hereto.

               Each of the Selling Shareholders hereby undertakes not to, either
               solely or jointly with any other Person (either on their own
               account or as the agent of any other Person):

               (a)    for a period of one (1) year from the Closing solicit or
                      accept the custom of any person in respect of goods or
                      services competitive with those manufactured or supplied
                      by OIC during the period of 12 months prior to Closing,
                      such person having been a customer of OIC in respect of
                      such goods or services during such period;

                                       32
<PAGE>   36

               (b)    for a period of two (2) years from the Closing induce,
                      solicit or endeavour to entice to leave the service or
                      employment of any employee of OIC or its Subsidiaries,
                      likely (in the opinion of MRV) to be:-

                      (i)   in possession of Confidential Information; or

                      (ii)  able to influence the customer relationships or
                            connections of OIC or its Subsidiaries; or

                      (iii) use any trade or domain name or e-mail address used
                            by OIC at any time during the two (2) years
                            immediately preceding the date of this agreement or
                            any other name intended or likely to be confused
                            with any such trade or domain name or e-mail
                            address.

       13.18.2 Selling Shareholders shall use their best efforts to cause the
               Principal Employees to undertake, not to, within two years after
               the termination of their employment with OIC or its Subsidiaries
               either solely or jointly with other Person (either on their own
               account or as the agent of any other Person) conduct any
               behaviors provided in Section 13.18.1. In the case that any
               Principal Employee breaches any obligations contained in the
               Principal Employee's Letter of Consent (Exhibit G), the Escrowed
               Shares belonging to such breaching Principal Employee and the
               unexercised stock options of the breaching Principal Employee
               referred to in Article 2.1.4 shall be forfeited and shall be
               redistributed among non-breaching Principal Employees by MRV on a
               pro rata basis or other methods deemed appropriate by MRV.

       13.18.3 Selling Shareholders agree that the undertakings contained in
               this Section 13.18 are reasonable and are entered into for the
               purpose of protecting the goodwill of the business of OIC and its
               Subsidiaries and that accordingly the benefit of the undertakings
               may be assigned by MRV and its successors in title without the
               consent of the Selling Shareholders.

       13.18.4 Each undertaking contained in this Section 13.18.3 is and shall
               be construed as separate and severable and if one or more of the
               undertakings is held to be against the public interest or
               unlawful or in any way an unreasonable restraint of trade or
               unenforceable in whole or in part for any reason the remaining
               undertakings or parts thereof, as appropriate, shall continue to
               bind Selling Shareholders.

       13.18.5 If any undertaking contained in this Section 13.18 shall be held
               to be void but would be valid if deleted in part or reduced in
               application, such undertaking shall apply with such deletion or
               modification as may be necessary to make it valid and
               enforceable. Without prejudice to the generality of the
               foregoing, such period (as the same may previously have been
               reduced by virtue of this Section 13.18.4) shall take effect as
               if reduced by six months until the resulting period shall be
               valid and enforceable.

                                       33
<PAGE>   37

13.19   Both Parties shall promptly determine the appropriate Closing Date and
        the appropriate measures to deal with the share split which may be
        approved by the shareholders meeting of MRV to be held in May 2000.

                                       34
<PAGE>   38

IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the
date first above written.

                  MRV COMMUNICATIONS, INC.

                  /s/ Edmund Glazer
                  --------------------------------
                  By:    Edmund Glazer
                  Title: Vice President & CFO

                  OPTRONICS INTERNATIONAL CORPORATION

                  /s/ Dr. C.J. Hwang
                  --------------------------------
                  By:    Dr. C.J. Hwang
                  Title: President

                  SIGNING SHAREHOLDERS

                  /s/ Dr. C.J. Hwang
                  --------------------------------
                  Represented by: Dr. C.J. Hwang

<PAGE>   39

                                     ANNEX 1

DEFINITIONS

"ADVERSE CONSEQUENCES" means all actions, suits, proceedings, hearings,
investigations, charges, complaints, claims, demands, injunctions, judgments,
orders, decrees, rulings, damages, dues, penalties, fines, costs, amounts paid
in settlement, Liabilities, obligations, Taxes, liens, losses, expenses, and
fees, including court costs and reasonable attorneys' fees and expenses.

"AFFILIATE" means in relation to any Party, any company, other commercial entity
or person which directly or indirectly controls, or is controlled by, under
common control with, any Party or any of the Parties' directors, supervisors or
management personnel.

"APPROVALS" means (i) the approval granted by the Hsinchu Science-based
Industrial Park Administration of the acquisition by MRV of OIC Shares
contemplated by this Agreement so that, after the Closing, OIC shall be deemed
to be a foreign invested company with foreign investment approval (an "FIA
company"), (ii) the approval required under Hart-Scott-Rodino Act, and (iii) any
other governmental or regulatory approvals of the transactions contemplated
hereunder which may be required by Applicable Law (if any).

"APPLICABLE LAW" shall include all laws, ordinances, rules, regulations,
administrative or judicial orders, injunctions, notices, approvals or judgment
of any federal, national, state, provincial or local government or governmental
department, agency, or instrumentality.

"BUSINESS DAY" means any day on which banks in both New York and Taiwan are open
for business.

"CLOSING" has the meaning set forth in Section 3.

"CLOSING DATE" has the meaning set forth in Section 3.

"CLOSING AGENT" shall have the meaning set forth in Section 2.1.1 (a).

"CONFIDENTIAL INFORMATION" means any information concerning the transactions
contemplated in this Agreement and is not already generally available to the
public.

"CONTRACT" means any agreement, contract, obligation, promise, or understanding
(whether written or oral and whether express or implied) that is legally binding
on either OIC or any of its Subsidiaries.

"ENCUMBRANCE" means any security interest, lien, claim, option, warrant,
easement, limitation, restriction, royalty, charge, pledge, preemptive or other
right, restraint on alienation, voting trust or arrangement, proxy, shareholders
agreement, mortgage or other encumbrance.

"ESCROW AGENT" shall have the meaning set out in Section 10.2.3.

"ESCROW AGREEMENT" means an Escrow Agreement to be signed by and among MRV,

                                       1
<PAGE>   40

Escrow Agent and Signing Shareholders in connection with Escrowed Shares on the
same date of this Agreement.

"ESCROWED SHARES" shall have the meaning as defined in Section 10.2.3.

"FINANCIAL STATEMENTS" has the meaning set forth in Section 5.3.1.

"GUARANTIES" means any guaranty or other surety provided by a Person Company in
respect of any indebtedness or other obligation.

"HART-SCOTT-RODINO ACT" means the Hart-Scott-Rodino Antitrust Improvements Act
of 1976, as amended.

"INDEMNIFIED PARTY" has the meaning set forth in Section 10.3.1 below.

"INDEMNIFYING PARTY" has the meaning set forth in Section 10.3.1 below.

"INTELLECTUAL PROPERTY" means (a) all inventions (whether patentable or
unpatentable and whether or not reduced to practice), all improvements thereto,
and all patents, patent applications, and patent disclosures, together with all
reissuances, continuations, continuations-in-part, revisions, extensions, and
reexaminations thereof, (b) all trademarks, service marks, trade dress, logos,
trade names, and corporate names, together with all translations, adaptations,
derivations, and combinations thereof and including all goodwill associated
therewith, and all applications, registrations, and renewals in connection
therewith, (c) all copyrightable works, all copyrights, and all applications,
registrations, and renewals in connection therewith, (d) all mask works and all
applications, registrations, and renewals in connection therewith, (e) all trade
secrets and confidential business information (including ideas, research and
development, know-how, formulas, compositions, manufacturing and production
processes and techniques, technical data, designs, drawings, specifications,
customer and supplier lists, pricing and cost information, and business and
marketing plans and proposals), (f) all computer software (including data and
related documentation), (g) all other proprietary rights, and (h) all copies and
tangible embodiments thereof (in whatever form or medium).

"KNOWLEDGE" means actual knowledge after reasonable investigation.

"LATEST BALANCE SHEET" shall name the meaning set out in Section 5.3.1.

"LATEST FINANCIAL STATEMENTS" shall have the meaning set out in Section 5.3.1.

"LOSS" shall mean any liability, loss, damage, claim, cost, deficiency,
delegation, or expense (including any penalty and any reasonably legal fees and
costs) incurred by a party.

"LIABILITY" means any liability (whether known or unknown, whether asserted or
unasserted, whether absolute or contingent, whether accrued or unaccrued,
whether liquidated or unliquidated, and whether due or to become due), including
any liability for Taxes.

"NEW TAIWAN DOLLARS" or "NT$" shall mean the lawful currency of the Republic of
China.

"ORDINARY COURSE OF BUSINESS" means the ordinary course of business

                                       2
<PAGE>   41

consistent with past custom and practice (including with respect to quantity and
frequency).

"PARTY" has the meaning set forth in the preface above.

"PERMIT" means all governmental licenses, registrations, authorizations,
permits, and approvals, and all applications therefor.

"PERSON" means an individual, a partnership, a corporation, an association, a
joint stock company, a trust, a joint venture, an unincorporated organization,
or a governmental entity (or any department, agency, or political subdivision
thereof).

"POWER OF ATTORNEY" means a Power of Attorney in the form of Exhibit A attached
hereto, duly executed by each Selling Shareholder in favor of the
Attorneys-in-Fact, by which each Selling Shareholder appoints and authorizes the
Attorneys-in-Fact, jointly and severally, to execute for and on behalf of the
Selling Shareholder this Agreement, and any and all other documents in
connection with the performance by Selling Shareholder of its/his/her
obligations hereunder, and to take all actions necessary or appropriate for the
performance of the transaction contemplated herein for and on behalf of the
Selling Shareholder.

"SUBSIDIARY", as it relates to any Person, means a corporation or other type of
entity of which such Person owns (or has the right to acquire either by contract
or exercise of outstanding options, warrants or other convertible instruments)
50% or more of the capital stock or equity interest.

"TARGET DAY" shall have the meaning set out in Section 3.1.

"TAX" means any federal, state, local, or foreign income, gross receipts,
license, payroll, employment, excise, severance, stamp, occupation, premium,
windfall profits, environmental (including taxes under Code Section 59A),
customs duties, capital stock, franchise, profits, withholding, social security
(or similar), unemployment, disability, real property, personal property, sales,
use, transfer, registration, value added, alternative or add-on minimum,
estimated, or other tax of any kind whatsoever, including any interest, penalty,
or addition thereto, whether disputed or not.

"TAX RETURN" means any return, declaration, report, claim for refund, or
information return or statement relating to Taxes, including any schedule or
attachment thereto, and including any amendment thereof.

"THIRD PARTY CLAIM" has the meaning set forth in Section 10.3.1.

"US GAAP" means United States generally accepted accounting principles as in
effect from time to time.

"U.S. PERSON" means: (i) any natural person resident in the United States, (ii)
any partnership or corporation organized or incorporated under the laws of the
United States, (iii) any estate of which any executor or administrator is a U.S.
Person, (iv) any trust of which any trustee is a U.S. Person, (v) any agency or
branch of a foreign entity located in the United States, (vi) any
non-discretionary account or similar account (other than an estate or trust)

                                       3
<PAGE>   42

held by a dealer or other fiduciary for the benefit or account of a U.S. Person,
(vii) any discretionary account or similar account (other than an estate or
trust) held by a dealer or other fiduciary organized, incorporated, or, if an
individual resident, in the United States, or (viii) any partnership or
corporation, if organized under the laws of any foreign jurisdiction and formed
by any U.S. Person principally, for the purpose of investing in securities and
registered under the Securities Act, unless it is organized or incorporated and
owned by accredited Selling Shareholders (as defined in Rule 501(a) under the
Securities Act who are not natural persons, estates or trusts.

"WASTE MATERIAL" shall mean any pollutant, contaminant, hazardous or toxic
material or other material produced, discharged or emitted by OIC or any of its
Subsidiaries other than products intended to be sold in the Ordinary Course of
Business.

                                       4<PAGE>   1

                                                                  EXHIBIT 10.20

                                                                  EXECUTION COPY
                                                                  --------------

                                ESCROW AGREEMENT
                                ----------------

     This ESCROW AGREEMENT (this "Agreement"), dated as of the 23rd day of
April, 2000, by and among MRV Communications, Inc. ("MRV"), the Selling
Shareholders of Optronics International Corp. ("OIC") and the law firm of Baker
& McKenzie, Taipei Office (the "Escrow Agent") having David T. Liou as its
representative.

                                    WITNESSTH

     WHEREAS, MRV and Selling Shareholders have entered into a Stock Purchase
Agreement dated April 23, 2000 (the "SPA") pursuant and subject to which MRV is
acquiring up to One Hundred Percent (100%), but not less than Seventy Five
Percent (75%), of the shares of OIC ("OIC Shares") from Selling Shareholders;

     WHEREAS, all capitalized terms not otherwise defined herein have the
meaning ascribed to such term in the SPA; and

     WHEREAS, Section 10.2.3 of the SPA contemplates that the Parties will enter
into an agreement with the Escrow Agent pursuant to which the Escrow Agent will
hold up to Six Hundred and Eighty Thousand (680,000) MRV Shares, subject to pro
rata adjustment based on the percentage of OIC Shares acquired by MRV, to be
issued to the Selling Shareholders of OIC under the SPA in escrow.

     WHEREAS, Section 10.2.3 of the SPA contemplates that the representations,
warranties, covenants and obligations of the Selling Shareholders shall be
secured by placing the aforesaid MRV Shares owned by Selling Shareholders in
escrow under this Agreement;

     NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants and conditions set forth below, the parties hereto hereby agree as
follows:

1.   At the Closing, MRV shall transfer the Escrowed Shares to the Selling
     Shareholders and then the Selling Shareholders shall deliver the Escrowed
     Shares directly to the Escrow Agent. The title of the Escrowed Shares shall
     be under the name of the authorized representative of the Selling
     Shareholders or as otherwise agreed by MRV. The Escrowed Shares delivered
     to the Escrow Agent shall be in the form of one (1) share certificate or
     other form as reasonably deemed appropriate by MRV. The Selling
     Shareholders will deliver to the Escrow Agent a Power of Attorney and a
     Stock Assignment, as attached in the Appendix A and B hereof, respectively,
     and with respect to the Escrowed Shares granting the Escrow Agent the
     exclusive right to vote, transfer, sell, assign, pledge and/or otherwise
     dispose of the Escrowed Shares according to MRV's instruction.

                                       1
<PAGE>   2

2.   The Escrow Agent agrees to keep the Escrowed Shares in a security vault or
     safe deposit box, and will act with respect to such Escrowed Shares
     pursuant to the terms of this Agreement and the SPA.

3.   The Selling Shareholders represent that Mr. C. J. Hwang (or his lawful
     successors designated by Selling Shareholders) has the power of attorney
     from all other Selling Shareholders in connection with any acts or
     omissions regarding disposition of the Escrowed Shares stipulated herein.

4.   On the date which is two (2) years from the date of Closing defined in SPA
     (or, if not a business day, then on the next occurring business day
     thereafter), the Escrow Agent shall deliver to Mr. C. J. Hwang (or his
     lawful successors designated by Selling Shareholders) on behalf of the
     Selling Shareholders all of the Escrowed Shares subject to the SPA and this
     Agreement.

5.   Except for the Escrow Shares belonging to Principal Employees, the Parties
     agree that one third (1/3) of the Escrowed Shares, or of the Escrowed
     Shares remaining after any call down exercised by MRV under Article 10 of
     the SPA, as the case may be, shall be released by the Escrow Agent to the
     Selling Shareholders on the date which is one (1) calendar year following
     the Closing Date. The remainder of the Escrow Shares shall be released on
     the date in accordance with Article 4 hereof.

6.   The Escrow Agent may take any action, including without limitation the
     transfer of title and possession of the affected Escrowed Shares to MRV,
     not specified in this Agreement upon receipt by the Escrow Agent of MRV's
     instruction to deal with the situations, including without limitation,
     relating to the disputes among the parties in connection of Section 10.2
     and other provisions of the SPA and this Agreement as may be applicable, or
     claims by any third party directly or indirectly, formally or informally,
     filed, occurred or made known to MRV or the Escrow Agent. If the above
     third party claim is filed, occurred or made known to MRV or the Escrow
     Agent, the title of the Escrowed Shares shall be deemed to be already
     transferred to MRV prior to such event as indicated above.

7.   The Escrow Agent undertakes to perform only such duties as are expressly
     set forth herein.

8.   MRV and the Selling Shareholders hereby agree to jointly and severally
     indemnify and hold the Escrow Agent harmless from and against any losses,
     costs, claims, or actions arising from or incurred in connection with the
     Escrow Agent's performance of his obligations in the SPA and this
     Agreement.

9.   The Escrow Agent may rely and shall be protected in acting or refraining
     from acting upon any written notice, instruction or request furnished to it
     hereunder and believed by it to be genuine and to have been signed or
     presented by the proper party according to this Agreement. The Escrow Agent
     may conclusively

                                       2
<PAGE>   3

     presume that the undersigned representative of any party hereto which is a
     legal entity other than a natural person has full power and authority to
     instruct the Escrow Agent on behalf of that party unless written notice to
     the contrary is delivered to the Escrow Agent according to this Agreement.

10.  The Escrow Agent shall not be liable for any action taken by it in good
     faith and believed by it to be authorized or within the rights or powers
     conferred upon it by this Agreement, and may consult with counsel of its
     own choice and shall have full and complete authorization and protection
     for any action taken or suffered by it hereunder in good faith and in
     accordance with the opinion of such counsel.

11.  The Escrow Agent may resign and be discharged from its duties or
     obligations hereunder by giving notice in writing of such resignation
     specifying a date upon which such resignation shall take effect, whereupon
     a successor Escrow Agent shall be appointed by MRV (subject to approval of
     Selling Shareholders, which shall not be unreasonably withheld).

12.  The Escrow Agent shall be entitled to compensation (the "Escrow Fees") in
     the amount equivalent to 0.3 % of the value of the Escrowed Shares
     (equaling US$70.588 per share) for the services to be rendered by it
     hereunder and in addition to be reimbursed for all losses, liabilities or
     expenses, including reasonable attorneys' fees ("Reimbursement"), incurred
     or made by it without gross negligence or bad faith arising out of or in
     connection with its entering into this Agreement or carrying out its duties
     hereunder, including the costs and expenses of defending itself against any
     claim of liability in the premises. The Escrow Fees shall be shared equally
     between the Selling Shareholders and MRV. The Selling Shareholder's half of
     the Escrow Fees has been deducted from the MRV Shares being transferred to
     the Selling Shareholders, and as a result MRV shall pay the entire Escrow
     Fees to the Escrow Agent on or before Closing. The Reimbursement shall be
     borne equally by the Selling Shareholders and MRV with the joint and
     several liability among the Selling Shareholders. For avoidance of doubt,
     the Escrow Fees only cover the services of taking custody of the Escrowed
     Shares.

13.  This Agreement expressly sets forth all the duties of the Escrow Agent with
     respect to any and all matters pertinent hereto. No implied duties or
     obligations shall be read into this Agreement against the Escrow Agent. The
     Escrow Agent shall not be bound by the provisions of any agreement among
     the parties hereto except this Escrow Agreement.

14.  This Agreement shall inure to the benefit of and be binding upon the
     parties and their respective heirs, successors, assigns and legal
     representatives, and shall be governed by and construed in accordance with
     the laws of Delaware, the United States applicable to contracts made and to
     be performed therein and cannot be changed or terminated except by a
     writing signed by MRV, Selling Shareholders and the Escrow Agent.

                                       3
<PAGE>   4

15.  This Agreement shall be interpreted in accordance with laws of Delaware,
     the United States without regard to its conflicts of law principles. The
     federal or state court of California shall have the exclusive jurisdiction
     over any disputes arising out of or in relation to this Agreement.

16.  All notices and other communications pursuant to this Agreement shall be in
     writing and shall be given (and shall be deemed to have been duly given if
     so given) by hand delivery, cable, telegram or telex, or by mail
     (registered or certified mail, postage prepaid, return receipt requested)
     to the respective parties as follows:

     (a)  In the case of MRV:

          MRV Communications, Inc.
          8943 Fullbright Ave
          Chatsworth, CA 91311
          U.S.A.
          Attention: Edmund Glazer

          With a copy to:

          Baker & McKenzie
          15F, 168 Tun Hwa N. Road,
          Taipei, Taiwan
          Attention: David T. Liou

     (b)  In the case of Selling Shareholders:

          C. J. Hwang
          No. 46, Park Avenue II Road
          Science-Based Industrial Park
          Hsin-Chu, Taiwan, R.O.C. 30077

     (c)  In the case of Escrow Agent:

          Baker & McKenzie
          15F, 168 Tun Hwa N. Road,
          Taipei, Taiwan
          Attention: David T. Liou

     or to such other person or address as any of the parties hereto shall
     specify by notice in writing to all the other parties hereto.

17.  This Agreement may be executed in any number of counterparts, each of which
     shall be deemed to be an original instrument and all of which together
     shall constitute a single agreement.

                                       4
<PAGE>   5

IN WITNESS WHEREOF, each of the parties hereto has duly executed this Agreement
on the date first above written.

                                            MRV COMMUNICATIONS INC.

                                            By: /s/ Edmund Glazer
                                                ----------------------------
                                                Edmund Glazer
                                                Vice President and CFO

                                            SELLING SHAREHOLDERS OF
                                            OPTRONICS INTERNATIONAL CORP.

                                            By: /s/ C. J. Hwang
                                                ----------------------------
                                                Dr. C. J. Hwang
                                                On behalf of the Selling
                                                Shareholders

                                            BAKER & McKENZIE, TAIPEI OFFICE

                                            By: /s/ David T. Liou
                                                ----------------------------
                                                David T. Liou
                                                Senior Partner

                                       5
<PAGE>   6
                                   APPENDIX A

                                POWER OF ATTORNEY

I, Dr. C. J. Hwang on behalf of the Selling Shareholders, hereby irrevocably
constitutes and appoints David T. Liou of Baker & McKenzie, Attorneys-at-Law, to
be my attorney in the Republic of China, with full power of substitution and
revocation, to hold up to Six Hundred and Eighty Thousand (680,000) shares, with
all dividends, rights and interests accruing to or accrue upon the same, of MRV
Communications Inc., which are registered in the name of the Selling
Shareholders on the shareholders' roster of MRV; and to vote, transfer, assign,
sell, pledge or otherwise dispose of the Escrowed Shares during the term of the
Escrow Agreement and in accordance with the provisions of the Escrow Agreement.

IN WITNESS WHEREOF, I have executed this Power of Attorney on the 23rd day of
April, 2000.

                              Selling Shareholders

                                 /s/ C. J. Hwang
                              -----------------------------------
                              Name:  C. J. Hwang
                              Title: Authorized Representative

                                       6
<PAGE>   7

                                   APPENDIX B

                                STOCK ASSIGNMENT

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto:

PLEASE INSERT SOCIAL SECURITY OR OTHER
       IDENTIFYING NUMBER OF ASSIGNEE

                                          ______________________________________
________________________________________________________________________________
__________________________________Shares of the Common Stock ___________________
Stock of MRV Communications, Inc. Corporation standing in ______________________
name(s) on the books of said Corporation represented by Certificate(s) No.
__________________________________________ herewith and do hereby irrevocable
constitute and appoint _________________________________________________________
____________________________________________________________ attorney to
transfer the said stock on the books of the within name corporation with full
power of substitution.

Date:
     -------------------
                                                   -----------------------------

                              Signature Guaranteed:
                                                   -----------------------------

                                       7

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