Document:

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                                                                    EXHIBIT 10.2

                            ASSET PURCHASE AGREEMENT

                                 BY AND BETWEEN

                              OCULAR SCIENCES, INC.

                                       AND

            ESSILOR INTERNATIONAL (COMPAGNIE GENERALE D'OPTIQUE) S.A.

                                DECEMBER 21, 2000
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                                TABLE OF CONTENTS

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ASSET PURCHASE AGREEMENT....................................................    1

ARTICLE I. DEFINITIONS......................................................    2

1.1   DEFINED TERMS.........................................................    2
1.2   OTHER DEFINED TERMS...................................................   12

ARTICLE II. PURCHASE AND SALE OF ASSETS.....................................   14

2.1   TRANSFER OF ASSETS....................................................   14
2.2   [RESERVED]............................................................   15
2.3   EXCLUDED LIABILITIES..................................................   15
2.4   PURCHASE PRICE........................................................   16
2.5   POST-CLOSING ADJUSTMENT...............................................   16
2.6   CLOSING COSTS; TRANSFER TAXES AND FEES................................   18

ARTICLE III.................................................................   18

3.1   CLOSING...............................................................   18
3.2   ACTIONS AT CLOSING....................................................   18

ARTICLE IV. REPRESENTATIONS AND WARRANTIES OF THE SELLERS...................   19

4.1   ORGANIZATION OF THE COMPANIES.........................................   19
4.2   SUBSIDIARIES..........................................................   20
4.3   AUTHORIZATION.........................................................   20
4.4   TITLE TO PURCHASED ASSETS; CONDITION AND SUFFICIENCY OF PURCHASED
      ASSETS ...............................................................   20
4.5   ABSENCE OF CERTAIN CHANGES OR EVENTS..................................   20
4.6   CONTRACTS AND LEASES..................................................   21
4.7   FACILITIES............................................................   22
4.8   PERMITS...............................................................   23
4.9   NO CONFLICT OR VIOLATION..............................................   23
4.10  CONSENTS AND APPROVALS................................................   24
4.11  FINANCIAL INFORMATION.................................................   24
4.12  BOOKS AND RECORDS.....................................................   24
4.13  LITIGATION............................................................   24
4.14  LABOR MATTERS.........................................................   25
4.15  LIABILITIES...........................................................   25
4.16  WARRANTY AND PRODUCT LIABILITY MATTERS................................   25
4.17  COMPLIANCE WITH LAW...................................................   26
4.18  NO BROKERS............................................................   26
4.19  PROPRIETARY RIGHTS....................................................   26
4.20  EMPLOYEE PLANS AND EMPLOYEE MATTERS...................................   28
4.21  TRANSACTIONS WITH CERTAIN PERSONS; PARENT AGREEMENTS..................   32
4.22  TAX MATTERS...........................................................   32
4.23  COMPUTER SOFTWARE.....................................................   33
4.24  ACCOUNTS RECEIVABLE...................................................   33
4.25  INVENTORY.............................................................   33
4.26  COMPLIANCE WITH ENVIRONMENTAL LAWS....................................   34
4.27  OWNERSHIP OF SUNSOFT SHARES AND SUNSOFT UK SHARES.....................   34
4.28  NO OTHER AGREEMENTS TO SELL THE BUSINESS OR THE PURCHASED ASSETS......   35
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4.29  MATERIAL MISSTATEMENTS OR OMISSIONS...................................   35
4.30  SUNSOFT AGREEMENTS; ABSENCE OF AGREEMENTS AND LIABILITIES.............   35

ARTICLE V. REPRESENTATIONS AND WARRANTIES OF THE PURCHASER..................   36

5.1   ORGANIZATION OF THE PURCHASER.........................................   36
5.2   AUTHORIZATION.........................................................   36
5.3   NO CONFLICT OR VIOLATION..............................................   36
5.4   CONSENTS AND APPROVALS................................................   37
5.5   NO BROKERS............................................................   37

ARTICLE VI. COVENANTS AND AGREEMENTS........................................   37

6.1   FURTHER ASSURANCES....................................................   37
6.2   NO SOLICITATION BY THE SELLERS........................................   39
6.3   NO SOLICITATION BY THE PURCHASER......................................   39
6.4   NOTIFICATION OF CERTAIN MATTERS.......................................   40
6.5   INVESTIGATION BY THE PURCHASER........................................   40
6.6   MAINTENANCE OF BUSINESS...............................................   41
6.7   CERTAIN PROHIBITED TRANSACTIONS.......................................   41
6.8   EMPLOYEES.............................................................   41
6.9   DIVISION OF BUSINESSES................................................   42
6.10  INTEGRATION OF THE BUSINESS WITH THE PURCHASER; TRANSITION SERVICES...   42
6.11  VENDOR RELATIONS......................................................   43
6.12  TAX MATTERS...........................................................   43
6.13  PHOTOCHROMIC TECHNOLOGY...............................................   44
6.14  PARENT BOARD OF DIRECTOR APPROVAL.....................................   45
6.15  HOC CONTACT LENS BUSINESS.............................................   45

ARTICLE VII. CONDITIONS PRECEDENT TO OBLIGATIONS OF THE PURCHASER...........   45

7.1   CONDITIONS............................................................   45

ARTICLE VIII. CONDITIONS PRECEDENT TO OBLIGATIONS OF SELLERS................   47

8.1   CONDITIONS............................................................   47

ARTICLE IX. INDEMNIFICATION.................................................   48

9.1   SURVIVAL OF REPRESENTATIONS, ETC......................................   48
9.2   INDEMNIFICATION.......................................................   48

ARTICLE X. TERMINATION......................................................   51

10.1  TERMINATION...........................................................   51
10.2  EFFECT OF TERMINATION.................................................   52

ARTICLE XI. MISCELLANEOUS...................................................   53

11.1  ASSIGNMENT............................................................   53
11.2  NOTICES...............................................................   53
11.3  CHOICE OF LAW.........................................................   54
11.4  ARBITRATION OF DISPUTES...............................................   54
11.5  ENTIRE AGREEMENT; AMENDMENTS AND WAIVERS; INTERPRETATION..............   54
11.6  COUNTERPARTS..........................................................   55
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11.7  INVALIDITY............................................................   55
11.8  COVENANTS OF SUBSIDIARIES.............................................   55
11.9  HEADINGS..............................................................   55
11.10 EXPENSES..............................................................   55
11.11 SCHEDULES.............................................................   55
11.12 PUBLIC STATEMENTS AND PRESS RELEASES..................................   55
11.13 NO THIRD-PARTY BENEFICIARIES..........................................   56
11.14 FURTHER ASSURANCES....................................................   56
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                         TABLE OF SCHEDULES AND EXHIBITS

            Disclosure Schedules

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            Exhibit 1          Assumed Liabilities
            Exhibit 2          Distribution Agreements
            Exhibit 3          Key Employee Severance Terms
            Exhibit 4          Excluded Assets
            Exhibit 5          Intellectual Property Licensing Agreement
            Exhibit 6          La Compasserie Facility Lease
            Exhibit 7          Non-Compete Agreement
            Exhibit 8          Software Not Dedicated to Business
            Exhibit 9          Dedicated Software
            Exhibit 10         Royalty Agreement
            Exhibit 11         [Reserved]
            Exhibit 12         Trademark License Agreement
            Exhibit 13         Transition Services Agreement
            Exhibit 14         Purchase Price Allocation
            Exhibit 15         Facilities Not Dedicated to the
                               Business
            Exhibit 16         Key Employees
            Exhibit 17         Sellers' Counsel Opinion
            Exhibit 18         Purchaser's Counsel Opinion

            Appendix 1         Assumed Employee Plans
            Appendix 2         Interim Financial Statements and Year-End
                               Financial Statements
            Appendix 3         Seller Retained Employee Plans
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                            ASSET PURCHASE AGREEMENT

            This Asset Purchase Agreement (this "Agreement"), dated as of
December 21, 2000, is entered into by and between Ocular Sciences, Inc., a
Delaware corporation (the "Purchaser") and Essilor International (Compagnie
Generale d'Optique) S.A., a French corporation (the "Parent").

                                    RECITALS

            A. The Parent through Parent's Contact Lens Division in France and
through various direct and indirect Subsidiaries in Europe and the United States
is engaged in the business of designing, developing, manufacturing and
distributing contact lenses (other than rigid gas permeable contact lenses
manufactured by the Parent or its Affiliates in the United States and other than
the distribution business operated through Parent Austria Sub, Parent Belgium
Sub and Parent Italy Sub (each as defined below) and Holland Optical Company
("HOC")) and contact lens care products primarily in Europe and the United
States (the "Business").

            B. The Parent operates the Business through Parent's Contact Lens
Division in France, and through the Parent's direct or indirect Subsidiaries (i)
Sunsoft Corporation in the United States ("Sunsoft"), a wholly-owned Subsidiary
of Essilor of America, Inc. ("Parent US Sub"), (ii) Lunelle Ltd. ("Lunelle UK")
and MJS Scientific Limited ("MJS") in the United Kingdom, (iii) Lunelle
Kontaktlinsen GmbH ("Lunelle Germany") in Germany, (iv) Lunelle BV ("Lunelle
Netherlands") in The Netherlands, (v) Lunelle SA ("Lunelle Switzerland") in
Switzerland, and (vi) Lunelle Scandinavia AS ("Lunelle Denmark") in Denmark
(Sunsoft, Parent US Sub, Lunelle UK, MJS, Lunelle Germany, Lunelle Netherlands,
Lunelle Switzerland, and Lunelle Denmark are sometimes collectively referred to
as the "Companies," and together with the Parent, the "Sellers").

            C. The Parent distributes products related to the Business through
certain distribution arrangements with the following Parent Subsidiaries: (i)
Essilor Austria GmbH ("Parent Austria Sub") in Austria, (ii) Essilor Belgium
S.A. N.V. ("Parent Belgium Sub") in Belgium, (iii) Essilor Italia S.p.A.
("Parent Italy Sub") in Italy, and (iv) HOC in The Netherlands.

            D. The Parent and the Companies own and lease certain Purchased
Assets (as defined below) which they use in the conduct of the Business.

            E. In reliance on and subject to the terms, conditions,
representations, warranties, covenants and agreements herein contained, the
Purchaser, either itself or through one or more Affiliates (collectively, the
"Purchasing Affiliates"), desires to acquire such Purchased Assets from the
Sellers, and the Sellers desire to sell such Purchased Assets to the Purchaser
or such Purchasing Affiliates, and the Purchaser, either itself or through one
or more Purchasing Affiliates, desires to enter into certain distribution
arrangements with Parent Austria Sub, Parent Belgium Sub and

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Parent Italy Sub, and Parent Austria Sub, Parent Belgium Sub and Parent Italy
Sub desire to enter into distribution arrangements with the Purchaser or such
Purchasing Affiliates.

                                    AGREEMENT

            NOW THEREFORE, in consideration of the respective covenants and
promises contained herein and for other good and valuable consideration, the
receipt and adequacy of which is hereby acknowledged, the parties hereto agree
as follows:

                                   ARTICLE I.
                                   DEFINITIONS

            1.1 Defined Terms. As used herein, the terms below shall have the
following meanings. Any of such terms, unless the context otherwise requires,
may be used in the singular or plural, depending upon the reference.

                  "Action" shall mean any action, claim, suit, litigation,
proceeding, labor dispute, arbitral action, governmental audit, inquiry,
criminal prosecution, investigation or unfair labor practice charge or
complaint.

                  "Affiliate" of a Person shall mean any other Person which
directly or indirectly controls, is controlled by, or is under common control
with, such Person. The term "control" (including, with correlative meaning, the
terms "controlled by" and "under common control with"), as used with respect to
any Person, means the possession, directly or indirectly, of the power to direct
or cause the direction of the management and policies of such Person, whether
through the ownership of voting securities, by contract or otherwise.

                  "Agreement" shall have the meaning set forth in the preamble
to this Agreement.

                  "Ancillary Agreements" shall mean the Transfer Documents, the
Non-Compete Agreement, the Royalty Agreement, the Intellectual Property
Licensing Agreement, the Distribution Agreements, the Transition Services
Agreement, the Trademark License Agreement and La Compasserie Facility Lease.

                  "Assumed Employee Plans" shall mean the Employee Plans set
forth on Appendix 1 hereto to be assumed by the Purchaser or the Purchasing
Affiliates.

                  "Assumed Liabilities" shall mean (a) all Liabilities accruing
with respect to events or occurrences happening after the Closing Date under the
Contracts and Leases listed on Schedule 4.6, or under Contracts or Leases which
are not listed on Schedule 4.6 but which the Purchaser elects to accept and
assume; (b) all Liabilities accruing with respect to events or occurrences
happening after the Closing Date with respect to the Transferred Employees (i)
for social security, Tax and other related charges, and (ii) under the Assumed
Employee Plans to the extent set forth in Section 6.8; (c) all of the Sellers'
accounts payable to suppliers or other creditors, and all provisions and
reserves related thereto, in each case to the extent set forth on

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the Interim Balance Sheet or incurred after the Interim Balance Sheet Date (but
subject to accrual as a Liability for balance sheet purposes in accordance with
GAAP) (i) in the Ordinary Course of Business, (ii) consistent with amounts
historically incurred and (iii) in compliance with the terms of this Agreement,
but excluding intercompany indebtedness as described in the definition of
Excluded Liabilities and excluding prepaid income; and (d) such other
Liabilities set forth on Exhibit 1.

                  "Average Exchange Rate" shall mean the respective averages of
(i) the rates of exchange of French francs for U.S. dollars of 6.8587, of pounds
sterling for French francs of 0.0964, of Swiss francs for French francs of
0.2375 and of Danish kroner for French francs of 1.377, and (ii) the rate of
exchange of French francs for U.S. dollars, and pounds sterling, Swiss francs
and Danish kroner for French francs, in each case on the Closing Date as
reported on the Closing Date in The Financial Times.

                  "Balance Sheet" shall mean the unaudited consolidated balance
sheet of Sellers with respect to the Business at the date indicated thereon,
together with the notes thereon, prepared in accordance with GAAP in a manner
consistent with the past practices of the Sellers.

                  "Code" shall mean the United States Internal Revenue Code of
1986, as amended, and the rules, regulations and interpretations promulgated
thereunder.

                  "Companies" shall have the meaning set forth in the preamble
to this Agreement.

                  "Confidentiality Agreement" shall mean the Confidentiality
Agreement, dated as of April 20, 1999, between the Purchaser and Parent.

                  "Consents" shall mean any and all consents, assignments,
approvals, authorizations or waivers of any public, governmental or regulatory
body or authority or from parties to Contracts that are (a) required for the
consummation of the transactions contemplated by this Agreement and the
Ancillary Agreements or (b) necessary or desirable in order that the Purchaser
can conduct the Business after the Closing Date substantially in the same manner
as the Business was conducted by the Companies before the Closing Date.

                  "Contract Rights" shall have the meaning set forth in the
definition of Purchased Assets.

                  "Contracts" shall mean all agreements, contracts, notes,
loans, evidences of indebtedness, Leases, purchase orders, letters of credit,
indentures, security or pledge agreements, undertakings, practices, covenants
not to compete, employment agreements, severance agreements, licenses,
instruments, obligations or commitments to which one or more of the Sellers is a
party or is bound and which relates to the Business or the Purchased Assets,
whether oral or written.

                  "Copyrights" shall mean registered copyrights, mask work
rights, mask work registrations, copyright applications and unregistered
copyrights.

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                  "Court Order" shall mean any judgment, decision, consent
decree, injunction, ruling or order of any foreign, federal, state or local
court or governmental agency, department or authority that is binding on any
Person or its property under applicable Law.

                  "Default" shall mean (a) any actual breach or default, (b) the
occurrence of an event that with the passage of time or the giving of notice or
both would constitute a breach or default or (c) the occurrence of an event that
with or without the passage of time or the giving of notice or both would give
rise to a right of termination, renegotiation or acceleration.

                  "Disclosure Schedule" shall mean a schedule executed and
delivered by the Parent to the Purchaser as of the date hereof which sets forth
the exceptions to the representations and warranties contained in Article IV of
this Agreement and certain other information called for by this Agreement.

                  "Distribution Agreements" shall mean the Distribution and
License Agreements to be executed by the Purchaser or Purchasing Affiliate and
each of Parent Austria Sub, Parent Belgium Sub and Parent Italy Sub regarding
distribution in Austria, Belgium and Italy dated as of the Closing Date
substantially in the form attached hereto as Exhibit 2.

                  "Encumbrance" shall mean any claim, lien, pledge, option,
charge, easement, security interest, deed of trust, mortgage, right-of-way,
encroachment, building or use restriction, conditional sales agreement,
encumbrance or other right of third parties, whether voluntarily incurred or
arising by operation of law, and includes, without limitation, any agreement to
give any of the foregoing in the future, and any contingent sale or other title
retention agreement or lease in the nature thereof.

                  "Environmental Law" shall mean all Laws which regulate or
relate to the protection or clean-up of the environment, the use, treatment,
storage, transportation, generation, manufacture, processing, distribution,
handling or disposal of, or emission, discharge or other release or threatened
release of, Substances or otherwise dangerous substances, wastes, pollution or
materials (whether gas, liquid or solid), the preservation or protection of
waterways, groundwater, drinking water, air, wildlife, plants or other natural
resources, or the health and safety of persons or property, including protection
of the health and safety of employees. Environmental Laws include the United
States Federal Water Pollution Control Act, the United States Resource
Conservation & Recovery Act, the United States Clean Water Act, Safe Drinking
Water Act, the United States Atomic Energy Act, the United States Occupational
Safety and Health Act, the United States Toxic Substances Control Act, the
United States Clean Air Act, the United States Comprehensive Environmental
Response, Compensation and Liability Act, the United States Hazardous Materials
Transportation Act and all analogous or related foreign, federal, state or local
Laws.

                  "ERISA" shall mean the United States Employee Retirement
Income Security Act of 1974, as amended, and the rules, regulations and
interpretations promulgated thereunder.

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                  "ERISA Affiliate" shall mean each other Person that, together
with any of Sellers as of the relevant measuring date under ERISA, is required
to be treated as a single employer under Section 414 of the Code.

                  "Excess Inventory" shall mean (i) Inventory which, based upon
the One Year Forecast of Demand (as defined below) by both store keeping unit
(SKU) and power, is not expected to be sold within one year following the date
of this Agreement, (ii) Inventory which the Sellers are no longer engaged in
marketing in the respective Seller's territory or which is damaged, destroyed or
otherwise unsaleable in the Ordinary Course of Business, (iii) any item of
Inventory (other than Lunelle products for which an expiry date is the latest
date on which the package for the product should be opened) with an expiry date
earlier than nine (9) months after the Closing Date, and (iv) any Lunelle
product which has an expiry date (the expiry date being the latest date on which
the package for the product should be opened) of one month (or such longer
period during which it is the ordinary practice of the Sellers not regularly to
sell such products) or less. For purposes of the foregoing, "One Year Forecast
of Demand" means (a) actual sales of Inventory (net of returns) for the twelve
(12) month period ended December 31, 2000; provided that, for new product lines
launched during 2000 and thus not available for sale from Inventory for the
entire year, actual sales (net of returns) of such products during 2000 prorated
for a full twelve (12) month period.

                  "Excluded Assets" shall mean all Owned Real Property and the
assets of the Sellers set forth on Exhibit 4.

                  "Excluded Liabilities" shall mean all Liabilities of the
Sellers not expressly specified in the definition of Assumed Liabilities,
whether liquidated or unliquidated, or known or unknown, whether arising out of
occurrences prior to, at or after the date hereof, which Excluded Liabilities
include, without limitation: (a) Liabilities related to any Pre-Closing
Environmental Matter; (b) except as otherwise provided in Section 6.8 with
respect to Transferred Employees and except to the extent reserved for in the
Ordinary Course of Business in the Closing Balance Sheet, any Liability to or in
respect of any employees or former employees of the Sellers including without
limitation (i) any employment agreement, whether or not written, between the
Sellers and any person, (ii) any Liability under any Assumed Employee Plan which
the Sellers may have incurred and not paid at or prior to Closing, and (iii) any
claim of an unfair labor practice, or any claim under any state unemployment
compensation or worker's compensation law or regulation or under any foreign,
federal or state employment discrimination law or regulation, which shall have
been asserted on or prior to the Closing Date or is based on acts or omissions
which occurred on or prior to the Closing Date; (c) except to the extent
reserved in the Ordinary Course of Business in the Closing Balance Sheet, any
Liability of the Sellers in respect of any Tax or social security, and any
Liability in respect of Taxes attributable to Purchased Assets for taxable
periods, or portions thereof, ending on or prior to the Closing Date; (d) except
to the extent reserved in the Ordinary Course of Business in the Closing Balance
Sheet, any Liability arising from any injury to or death of any person or damage
to or destruction of any property, whether based on negligence, breach of
warranty, strict liability, enterprise liability or any other legal or equitable
theory arising from defects in products manufactured or from services performed
by or on behalf of the Sellers or any other person or entity on or prior to the
Closing Date; (e) except to the extent reserved in the Ordinary Course of

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Business in the Closing Balance Sheet, any Liability of the Sellers arising out
of or related to any Action against the Sellers or any Action which adversely
affects the Purchased Assets and which shall have been asserted on or prior to
the Closing Date or to the extent the basis of which shall have arisen on or
prior to the Closing Date; (f) any Liability of the Sellers resulting from
entering into, performing its obligations pursuant to or consummating the
transactions contemplated by, this Agreement (including without limitation any
Liability of the Sellers pursuant to Article IX hereof); (g) any intercompany
Liabilities, including any Liabilities of the Companies owed to the Parent or
Liabilities of the Parent owed to any Affiliate of the Parent; (h) any Sunsoft
Acquisition Liabilities; (i) any Indebtedness of any of the Sellers; (j) any
Liabilities related to the Excluded Assets and any Liabilities incurred as a
result of the distribution of any assets of the Sellers prior to Closing; and
(k) any Liability under any Seller Retained Employee Plan at any time
maintained, contributed to or required to be contributed to by or with respect
to the Sellers or under which the Sellers may incur Liability, or any
contributions, benefits or Liabilities therefor, or any Liability with respect
to the Sellers' withdrawal or partial withdrawal from or termination of any
Seller Retained Employee Plan.

                  "Facilities" shall mean all plants, offices, manufacturing
facilities, stores, warehouses, retail establishments, improvements,
administration buildings and amenities, and all other facilities owned, leased
or used by the Sellers in connection with the Business.

                  "Financial Statements" shall mean the Year-End Financial
Statements and the Interim Financial Statements.

                  "GAAP" shall mean French generally accepted accounting
principles.

                  "Handling" shall have the meaning set forth in the definition
of Pre-Closing Environmental Matters.

                  "Indebtedness" shall mean with respect to any Person (a) all
obligations of such Person for borrowed money and for the deferred purchase
price of property, including, without limitation, pursuant to any capital lease
(excluding any operating lease), or services (other than obligations under
agreements for the purchase of goods and services in the Ordinary Course of
Business), and obligations evidenced by bonds, debentures, notes or similar
instruments (excluding "deposit only" endorsements on checks payable to the
order of such Person); (b) obligations (contingent or otherwise) under
reimbursement or similar agreements with respect to the issuance of letters of
credit; (c) obligations under any Interest Rate Protection Agreement; (d) all
indebtedness secured by any Encumbrance on any property owned or held by such
Person subject thereto, whether or not the indebtedness secured thereby shall
have been assumed; and (e) obligations of such Person under direct or indirect
guaranties in respect of, and obligations (contingent or otherwise) to purchase
or otherwise acquire, or otherwise to assure a creditor against loss in respect
of, indebtedness or obligations of any Person.

                  "Interest Rate Protection Agreement" shall mean any interest
rate swap agreement, interest rate collar agreement or other agreement providing
for bilateral payment obligations designed to protect against fluctuations in
interest rates entered into by any of the Sellers.

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                  "HSR Act" shall mean the United States Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended.

                  "Intellectual Property Licensing Agreement" shall mean the
Intellectual Property Licensing Agreement between the Purchaser and the Parent
(and/or such of the Companies as are owners of the technology rights set forth
in the Intellectual Property Licensing Agreement), dated as of the Closing Date
substantially in the form of Exhibit 5 hereto.

                  "Interim Balance Sheet" shall mean the unaudited Balance Sheet
dated the Interim Balance Sheet Date prepared in accordance with GAAP in a
manner consistent with the past practices of the Sellers attached hereto on
Appendix 2.

                  "Interim Balance Sheet Date" shall mean June 30, 2000.

                  "Interim Financial Statements" shall mean the Interim Balance
Sheet and the unaudited consolidated statements of operations and statement of
cash flows with respect to the Business for the period ended on the Interim
Balance Sheet Date, prepared in accordance with GAAP in a manner consistent with
the past practices of the Sellers, each attached hereto as Appendix 2.

                  "Inventory" shall mean all of the Sellers' inventory held for
resale and all of the Sellers' raw materials, work in process, finished
products, supply and packaging items and similar items with respect to the
Business, in each case wherever the same may be located.

                  "Knowledge of the Sellers" shall mean the knowledge of each of
the Sellers' Representatives, and the knowledge that such Representatives could
have ascertained from a review of the books, records and files of the Sellers.

                  "KPMG" shall mean KPMG LLP.

                  "La Compasserie Facility Lease" shall mean La Compasserie
Facility Lease to be executed by the Purchaser or a Purchasing Affiliate and the
Parent dated as of the Closing Date containing the terms set forth in the
attached Exhibit 6 hereto, provided, however, that the method used for computing
rental and maintenance charges paid by the Purchaser or Purchasing Affiliate
shall not in any event differ from the method used for computing comparable
charges allocated by the Parent to the Business with respect to the use of La
Compasserie Facility.

                  "Law" shall mean any laws, statutes, ordinances, regulations,
rules, notice requirements, court decisions, agency guidelines, principles of
law and orders of any foreign, federal, state or local government and any other
governmental department or agency, and including without limitation
Environmental Laws, energy, motor vehicle safety, public utility, zoning,
building and health codes, occupational safety and health regulations, and laws
respecting employment practices, employee documentation, terms and conditions of
employment and wages and hours.

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                  "Leased Real Property" shall mean all leased property
described in the Leases related to Facilities.

                  "Leases" shall mean all of the existing leases, subleases,
occupancy agreements, options, rights, concessions or other agreements or
arrangements with respect to the personal or real property of the Sellers as
listed on Schedule 4.7.

                  "Liabilities" shall mean any direct or indirect liability,
indebtedness, obligation, commitment, expense, claim, deficiency, guaranty or
endorsement of or by any Person of any type, known or unknown, and whether
accrued, absolute, contingent, matured, unmatured or other.

                  "Marketing Assets" shall mean supplies, sales literature,
catalogues, brochures, promotional literature, customer, supplier and
distributor lists, art work, display units, other marketing materials, telephone
and fax numbers and purchasing records related to the Business.

                  "Material Adverse Effect" or "Material Adverse Change" shall
mean, with respect to the Business or the Purchased Assets, any material adverse
effect or change in the condition (financial or otherwise), business, results of
operations, prospects, assets, Liabilities or operations of the Business and/or
the Purchased Assets or on the ability of the Companies or the Parent to
consummate the transactions contemplated hereby, or any event or condition which
would or would be reasonably likely, with the passage of time, to constitute a
"Material Adverse Effect" or "Material Adverse Change."

                  "Net Current Asset Value" shall mean the book value of the
current assets included in the Purchased Assets less the current Liabilities
included in the Assumed Liabilities, calculated in accordance with GAAP in a
manner consistent with the past practices of the Sellers in the preparation of
the Interim Balance Sheet.

                  "Non-Compete Agreement" shall mean the
Non-Compete/Non-Solicitation Agreement to be executed by the Purchaser and the
Parent regarding the Parent's and its Subsidiaries' covenants not to compete in
the Business for a period of five (5) years substantially in the form attached
hereto as Exhibit 7.

                  "Operating Site" shall have the meaning set forth in the
definition of Pre-Closing Environmental Matters.

                  "Ordinary Course of Business" or "Ordinary Course" or any
similar phrase shall mean the course of conduct of the Business in a manner
consistent with both (a) the Sellers' past practices and (b) the practice of a
reasonable business person.

                  "Owned Real Property" shall mean all Real Property owned in
fee by the Sellers and utilized primarily for the Business, including without
limitation all rights, easements and privileges appertaining or relating
thereto, all buildings, fixtures, and improvements located thereon and all
Facilities thereon, if any.

                                       8
<PAGE>
                  "Patent and Know-How License Agreement" shall mean that
certain Patent and Know-How License Agreement between the Parent and Sunsoft
dated as of January 1, 1995.

                  "Patents" shall mean all patents and patent applications and
registered design and registered design applications and all rights in
connection therewith.

                  "Permits" shall mean all licenses, permits, franchises,
approvals, authorizations, consents or orders of, or filings with, any
governmental authority, whether foreign, federal, state or local, or any other
Person, necessary or desirable for the past, present or anticipated conduct of,
or relating to the operation of, the Business.

                  "Person" shall mean any person or entity, whether an
individual, trustee, corporation, partnership, limited partnership, limited
liability company, trust, unincorporated organization, business association,
firm, joint venture, or governmental agency or authority.

                  "Pre-Closing Environmental Matters" shall mean (a) the
production, use, generation, emission, storage, treatment, transportation,
recycling, disposal, discharge, release, or other handling or disposition of any
kind on or prior to the Closing Date (collectively, "Handling") by the Sellers
or their Affiliates (including any other entities, the assets or obligations of
which have been acquired or assumed by any of the Sellers or to which any of the
Sellers has succeeded, collectively, "Predecessors") of any Substance, either
in, on, from or under any Real Property or Facility owned, leased or used at any
time by the Sellers or their Affiliates or their Predecessors in connection with
the operation of the Business, including any offsite disposal facilities (an
"Operating Site"), including, without limitation, the effects of such Handling
of Substances on resources, Persons, or property within or outside the
boundaries of any Operating Site, and (b) any other act or omission of the
Sellers or their Affiliates or their Predecessors prior to the Closing Date that
gives rise to Liability or potential Liability under any Environmental Law.

                  "Proprietary Rights" shall mean all of the Sellers'
Copyrights, Patents, Trademarks, tradenames, technology rights and licenses,
computer software (including without limitation any source or object codes
therefor or documentation relating thereto, but not including off-the-shelf
computer software) dedicated solely to use in the Business, trade secrets,
confidential information, technical information, know-how, processes,
inventions, designs, specifications, plans, drawings and intellectual property
rights used in the Business, but excluding (i) the photochromic intellectual
property rights subject to Section 6.13 hereof and (ii) the Trademarks and
tradenames of Parent subject to the Trademark License Agreement. A list of
computer software used in the Business but not dedicated to the Business is set
forth on Exhibit 8 and shall be subject to the Transition Services Agreement.

                  "Purchased Assets" shall mean all of the Sellers' right, title
and interest in and to the properties and assets and rights of any kind, whether
tangible or intangible, real or personal, used in or related to the Business,
including: (a) U.S.$3,200,000 in cash (net of any payments required to be made
in discharge of the Liabilities set forth on Exhibit 1 hereto); (b) all accounts
and notes receivable (whether

                                       9
<PAGE>
current or noncurrent), refunds, deposits, prepayments and prepaid expenses of
the Sellers related to the Business; (c) all the Sellers' rights under the
Contracts (the "Contract Rights"); (d) ) all the Sellers' rights under the
Leases; (e) all leasehold improvements with respect to the property subject to
the Leases; (f) all Inventory; (g) books and records related to the Business;
(h) all fixtures and equipment related to the Business; (i) the Proprietary
Rights, including the computer software dedicated to use in the Business
identified on Exhibit 9 hereto; (j) to the extent transferable, all Permits; (k)
the Marketing Assets; (l) all computers and software related to the Business;
(m) all claims, causes of action, choses in action, rights of recovery and
rights of set-off of any kind, against any Person, including without limitation
any liens, security interests, pledges or other rights to payment or to enforce
payment in connection with products delivered by the Sellers with respect to the
Business on or prior to the Closing Date; and (n) all of the issued and
outstanding shares of Sunsoft; but, notwithstanding the foregoing, excluding
therefrom the Excluded Assets.

                  "Purchaser Barbados Sub" shall mean Precision Lens
Manufacturing & Technology, Inc., a company organized under the laws of
Barbados, and a wholly-owned Subsidiary of the Purchaser.

                  "Purchaser Manufacturing UK Sub" Purchaser Barbados Sub's
manufacturing Subsidiary organized under the laws of the United Kingdom.

                  "PWC" shall mean PriceWaterhouseCoopers LLP.

                  "Real Property" shall mean all real property owned or leased
by or used, or intended by the Sellers for use, in connection with the Business,
together with all buildings, improvements, fixtures, easements, licenses,
options, insurance proceeds and condemnation awards and all other rights of the
Sellers in or appurtenant thereto.

                  "Representative" with respect to any Person shall mean any
officer, director, principal, attorney, agent, employee or other representative
of such Person.

                  "Royalty Agreement" shall mean the Royalty Agreement regarding
payment of royalties by the Purchaser to Parent on sales of the new toric
frequent replacement lens and the "Rythmic Multifocal" lens dated the Closing
Date between the Parent and the Purchaser, substantially in the form attached
hereto as Exhibit 10.

                  "Seller Retained Employee Plans" shall mean all Employee Plans
of the Sellers, including, but not limited to, the Employee Plans set forth on
Appendix 3 hereto, except for the Assumed Employee Plans.

                  "Subsidiary" of a Person shall mean (a) any corporation or
company in an unbroken chain of corporations or companies beginning with such
Person if each of the corporations or companies other than the last corporation
or company in the unbroken chain then owns stock possessing 50% or more of the
total combined voting power of all classes of stock in one of the other
corporations or companies in such chain, (b) any partnership in which the Person

                                       10
<PAGE>
is a general partner, or (c) any partnership in which the Person possesses a 50%
or greater interest in the total capital or total income of such partnership.

                  "Substance" shall mean any pollutants, contaminants,
chemicals, waste and any toxic, infectious, carcinogenic, reactive, corrosive,
ignitible or flammable chemical or chemical compound or hazardous substance,
material or waste, whether solid, liquid or gas, including any quantity of
asbestos in any form, urea formaldehyde, PCB's, radon gas, crude oil or any
fraction thereof, all forms of natural gas, petroleum products or by-products or
derivatives, radioactive substance, waste waters, sludges, slag and any other
substance, material or waste that is subject to regulation, control or
remediation under any Environmental Laws.

                  "Sunsoft Acquisition Liabilities" shall mean all Liabilities
arising out of or relating to the acquisition by the Parent or its Affiliates of
Sunsoft.

                  "Tax" or "Taxes" shall mean any federal, state, local or
foreign income, gross receipts, license, payroll, employment, excise, severance,
stamp, occupation, premium, windfall profits, environmental, customs duties,
capital stock, franchise, profits, withholding, social security, 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 Returns" shall mean 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.

                  "Trademark License Agreement" shall mean the Trademark License
Agreement between the Purchaser and the Parent dated as of the Closing Date
substantially in the form attached hereto as Exhibit 12.

                  "Trademarks" shall mean registered trademarks, registered
service marks, trade dress rights, trade names, trademark and service mark
applications and unregistered trademarks and service marks relating to the
Business.

                  "Trade Regulation Laws" shall mean the HSR Act, European Union
filings and such other similar competition Law filings with governmental
entities required to be made prior to or subsequent to the consummation of the
transactions contemplated by this Agreement.

                  "Transition Services Agreement" shall mean the Transition
Services Agreement dated the Closing Date between the Purchaser and the Parent
substantially in the form attached hereto as Exhibit 13.

                  "Year-End Financial Statements" shall mean the Balance Sheet
and the consolidated statements of operations with respect to the Business for
the period ended on December 31, 1999, prepared in accordance with GAAP in a
manner consistent with the past practices of the Sellers, each attached hereto
on Appendix 2.

                                       11
<PAGE>
            1.2   Other Defined Terms.  The following terms shall have the
meanings defined for such terms in the Sections set forth below:

<TABLE>
<CAPTION>
            Term                                            Section
            ----                                            -------
<S>                                                         <C>
            Actual Net Liability                            2.5
            Adjustment Amount                               2.5
            Business                                        Recitals
            Business Employees                              4.14
            Claim                                           9.2
            Claim Notice                                    9.2
            Closing                                         3.1
            Closing Balance Sheet                           2.5
            Closing                                         3.1
            Competing Transaction                           6.3
            Consultant                                      6.5
            Continuing Contracts                            6.1
            Damages                                         9.2
            Damage Threshold                                9.2
            Employee Plan                                   4.21
            Environmental Review                            6.5
            Estimated Net Liability                         2.4
            Excess Cash                                     2.5
            Executive Employment Agreements                 7.1
            Foreign Plan                                    4.21
            French Transfer Tax Liability                   2.6
            HOC                                             Recitals
            HOC Contact Lens Business                       4.2
            IRS                                             4.21
            Key Employee                                    7.1
            Lunelle Denmark                                 Recitals
            Lunelle Germany                                 Recitals
            Lunelle Netherlands                             Recitals
            Lunelle Switzerland                             Recitals
            Lunelle UK                                      Recitals
            Material Contract                               4.6
            MJS                                             Recitals
            Net French Transfer Tax Liability               2.4
            New Danish Subsidiary                           2.1
            New Dutch Subsidiary                            2.1
            New French Subsidiary                           2.1
            New German Subsidiary                           2.1
            New Swiss Subsidiary                            2.1
            Parent Austria Sub                              Recitals
            Parent Belgium Sub                              Recitals
            Parent Italy Sub                                Recitals
</TABLE>

                                       12
<PAGE>
<TABLE>
<S>                                                         <C>
            Parent US Sub                                   Recitals
            Parent Agreements                               4.21
            Parent Board Approval                           6.14
            Proceeding                                      6.12
            Purchase Price                                  2.3
            Purchaser Indemnified Parties                   9.2
            Purchasing Affiliate                            Recitals
            Seller Acquisition Proposal                     6.2
            Seller Indemnified Parties                      9.2
            Straddle Period                                 6.12
            Sunsoft                                         Recitals
            Sunsoft/Briggs Employment Agreement             4.30
            Sunsoft Employee Plan                           4.21
            Sunsoft Shareholders Agreement                  4.30
            Sunsoft UK                                      4.2
            Terminating Purchaser Breach                    10.1
            Terminating Seller Breach                       10.1
            Transfer Documents                              3.2
            Transferred Employee                            6.8
</TABLE>

                                       13
<PAGE>
                                   ARTICLE II.
                           PURCHASE AND SALE OF ASSETS

            2.1   Transfer of Assets.

                  (a) Prior to Closing, the Purchaser intends to cause Purchaser
Barbados Sub to form and establish the following Purchasing Affiliates:

                        (i) a new wholly-owned Subsidiary of Purchaser Barbados
Sub under the laws of France (the "New French Subsidiary");

                        (ii) a new wholly-owned Subsidiary of Purchaser Barbados
Sub under the laws of Germany (the "New German Subsidiary");

                        (iii) a new wholly-owned Subsidiary of Purchaser
Barbados Sub under the laws of The Netherlands (the "New Dutch Subsidiary");

                        (iv) a new wholly-owned Subsidiary of Purchaser Barbados
Sub under the laws of Switzerland (the "New Swiss Subsidiary"); and

                        (v) a new wholly-owned Subsidiary of Purchaser Barbados
Sub under the laws of Denmark (the "New Danish Subsidiary").

                  (b) Upon the terms and subject to the conditions contained in
this Agreement, at the Closing the Business shall be transferred to the
Purchaser or a designated Purchasing Affiliate (including, at the option of the
Purchaser, a Purchasing Affiliate not specified in Section 2.1(a)), which
particular designation shall be subject to change by the Purchaser in its
discretion, as follows:

                        (i) United States. The Parent shall cause Parent US Sub
to sell, convey, transfer, assign and deliver all of the issued and outstanding
shares of Sunsoft to the Purchaser (or, at the election of the Purchaser, to a
Purchasing Affiliate), and the Purchaser (or, if so elected by the Purchaser, a
Purchasing Affiliate) shall acquire from Parent US Sub all of the issued and
outstanding shares of Sunsoft, free and clear of all Encumbrances.

                        (ii) France. (A) The Parent shall sell, convey,
transfer, assign and deliver to Purchaser Barbados Sub, and Purchaser Barbados
Sub shall acquire from the Parent, free and clear of all Encumbrances, all of
the Proprietary Rights and Marketing Assets related to the Business in France,
and (B) the Parent shall sell, convey, transfer, assign and deliver to the New
French Subsidiary, and the New French Subsidiary shall acquire from the Parent,
free and clear of all Encumbrances, all of the Purchased Assets related to the
Business in France (except for the Proprietary Rights and Marketing Assets
related to the Business in France). Upon the terms and subject to the conditions
contained in this Agreement, at the Closing, the New French Subsidiary shall
assume the Assumed Liabilities related to the Business in France.

                                       14
<PAGE>
                        (iii) United Kingdom. (A) The Parent shall cause Lunelle
UK and MJS to sell, convey, transfer, assign and deliver to Purchaser Barbados
Sub, and Purchaser Barbados Sub shall acquire from Lunelle UK and MJS, free and
clear of all Encumbrances, all of the Proprietary Rights and Marketing Assets
related to the Business in the United Kingdom, and (B) the Parent shall cause
Lunelle UK and MJS to sell, convey, transfer, assign and deliver to Purchaser
Manufacturing UK Sub, and Purchaser Manufacturing UK Sub shall acquire from
Lunelle UK and MJS, free and clear of all Encumbrances, all of the Purchased
Assets related to the Business in the United Kingdom (except for the Proprietary
Rights and Marketing Assets related to the Business in the United Kingdom). Upon
the terms and subject to the conditions contained in this Agreement, at the
Closing, Purchaser Manufacturing UK Sub shall assume the Assumed Liabilities
related to the Business in the United Kingdom.

                        (iv) Germany. The Parent shall cause Lunelle Germany to
sell, convey, transfer, assign and deliver to the New German Subsidiary, and the
New German Subsidiary shall acquire from Lunelle Germany, free and clear of all
Encumbrances, all of the Purchased Assets related to the Business in Germany.
Upon the terms and subject to the conditions contained in this Agreement, at the
Closing, the New German Subsidiary shall assume the Assumed Liabilities related
to the Business in Germany.

                        (v) The Netherlands. The Parent shall cause Lunelle
Netherlands to sell, convey, transfer, assign and deliver to the New Dutch
Subsidiary, and the New Dutch Subsidiary shall acquire from Lunelle Netherlands,
free and clear of all Encumbrances, all of the Purchased Assets related to the
Business in The Netherlands. Upon the terms and subject to the conditions
contained in this Agreement, at the Closing, the New Dutch Subsidiary shall
assume the Assumed Liabilities related to the Business in The Netherlands.

                        (vi) Switzerland. The Parent shall cause Lunelle
Switzerland to sell, convey, transfer, assign and deliver to the New Swiss
Subsidiary, and the New Swiss Subsidiary shall acquire from Lunelle Switzerland,
free and clear of all Encumbrances, all of the Purchased Assets related to the
Business in Switzerland. Upon the terms and subject to the conditions contained
in this Agreement, at the Closing, the New Swiss Subsidiary shall assume the
Assumed Liabilities related to the Business in Switzerland.

                        (vii) Denmark. The Parent shall cause Lunelle Denmark to
sell, convey, transfer, assign and deliver to the New Danish Subsidiary, and the
New Danish Subsidiary shall acquire from Lunelle Denmark, free and clear of all
Encumbrances, all of the Purchased Assets related to the Business in Denmark.
Upon the terms and subject to the conditions contained in this Agreement, at the
Closing, the New Danish Subsidiary shall assume the Assumed Liabilities related
to the Business in Denmark.

            2.2 [Reserved]

            2.3 Excluded Liabilities(a) . Notwithstanding any other provision of
this Agreement, neither the Purchaser nor any Purchasing Affiliate, including
without limitation, the Purchasing Affiliates specified in subsections 2.1(b)(i)
through 2.1(b)(vii), shall assume, or otherwise be responsible for, any Excluded
Liabilities.

                                       15
<PAGE>
            2.4 Purchase Price.

                  (a) Purchase Price. The purchase price (the "Purchase Price")
for the sale, transfer and delivery of the Purchased Assets shall be
U.S.$49,000,000 less the French Transfer Tax Liability net of Purchaser's
recoverable income Tax resulting from the payment of the French Transfer Tax
Liability. The amount of the French Transfer Tax Liability net of the
Purchaser's recoverable income Tax resulting from the payment of the French
Transfer Tax Liability shall be estimated by the Purchaser on the Closing Date
for purposes of computing the Purchase Price (the "Estimated Net Liability") and
the Purchase Price shall be paid by the Purchaser (either directly or through
one or more Purchasing Affiliates) in United States dollars to the Parent, on
the Closing Date by wire transfer of immediately available funds.

                  (b) Royalty Agreement. At the Closing, the Purchaser and the
Parent shall enter into the Royalty Agreement regarding payments with respect to
sales of the new toric frequent replacement lens and the "Rythmic Multifocal"
lens.

                  (c) The Purchase Price shall be allocated among the Purchased
Assets for Tax purposes in accordance with Exhibit 14 hereto; provided, however,
that following the execution hereof and prior to the Closing, the Parent and the
Purchaser shall make a separate allocation among tangible and intangible assets
for Tax purposes in accordance with the allocation set forth on Exhibit 14.

            2.5 Post-Closing Adjustment.

                  (a) Closing Balance Sheet. On or before the date which is
ninety (90) days after the last day of the month in which the Closing occurs,
the Purchaser shall prepare and deliver to the Parent (i) a balance sheet dated
the Closing Date reflecting the Purchased Assets and the Assumed Liabilities
(converted from pounds sterling, Swiss francs and Danish kroner into French
francs and from French francs into U.S. dollars using the respective Average
Exchange Rates for those currencies) which shall be audited by KPMG and be
accompanied by the unqualified report of such firm (the "Closing Balance
Sheet"), and (ii) a reasonably detailed calculation of the Adjustment Amount.
The Closing Balance Sheet (A) shall be prepared by the Purchaser's personnel in
accordance with GAAP, as applied in preparation of the Interim Balance Sheet,
(B) shall include a physical count of Inventory using the same procedures
normally used by the Sellers to take inventories of the type of Inventory being
counted, (C) shall exclude all Excess Inventory, (D) shall exclude all Excluded
Assets and Excluded Liabilities, and (E) shall otherwise fairly and accurately
present the consolidated assets, Liabilities (including reserves) and financial
position of the Business acquired by the Purchaser hereunder as of the Closing
Date. The Closing Balance Sheet shall be accompanied by reasonably detailed
schedules identifying the Purchased Assets, the Assumed Liabilities, the
Excluded Assets and the Excluded Liabilities, and a calculation of the Net
Current Asset Value on the Closing Date.

                                       16
<PAGE>
                  (b) Payment of Adjustment Amount. In the event that the Net
Current Asset Value set forth on the Closing Balance Sheet is less than
U.S.$13,548,000 (inclusive of the U.S.$3,200,000 in cash included in the
Purchased Assets), the Parent shall pay the amount of the difference (the
"Adjustment Amount") in U.S. dollars to the Purchaser by wire transfer of
immediately available funds to an account designated by the Purchaser. To the
extent that any portion of the Adjustment Amount is not disputed by the Parent
in the manner provided in Section 2.5(c) hereof, that portion of the Adjustment
Amount which is not in dispute shall be paid to the Purchaser within fifteen
(15) business days after the Parent's receipt of the Closing Balance Sheet.

                  (c) Disputed Adjustment Amount. If the Parent shall disagree
with the Adjustment Amount, if any, it shall notify the Purchaser of such
disagreement in writing specifying in detail the particulars of such
disagreement within thirty (30) business days after the Parent's receipt of the
Closing Balance Sheet.

                  (d) Resolution of Disputed Adjustment Amount. The Purchaser
and the Parent shall use their best efforts for a period of thirty (30) calendar
days after the Parent's delivery of such notice of disagreement (or such longer
period as the Purchaser and the Parent shall mutually agree upon) to resolve any
disagreements raised by the Parent with respect to the calculation of the
Adjustment Amount. If, at the end of that thirty (30) day period, the Purchaser
and the Parent are unable to resolve the disagreements, PWC and KPMG,
independent auditors of the Sellers and the Purchaser, respectively, shall
jointly select a third independent auditor of recognized international standing
to resolve any remaining disagreements. The determination by the third
independent auditor shall be final, binding and conclusive on the parties. The
Purchaser and the Parent shall use their best efforts to cause the third
independent auditor to make its determination within thirty (30) calendar days
of accepting its selection. Within five (5) calendar days after the date of
determination of the third independent auditor, the Parent shall pay the
Purchaser the Adjustment Amount, if any, in the manner set forth in Section
2.5(b). The fees and expenses of the third independent auditor shall be borne by
the Purchaser and the Parent in proportion to the amount of the disputed item
with respect to which such party's claim was unsuccessful.

                  (e) Payment of Excess Cash. Subject to the resolution of all
disputes with respect to the Closing Balance Sheet in accordance with this
Section 2.5, in the event that the Purchased Assets include cash in excess of
U.S.$3,200,000 on the Closing Date ("Excess Cash") and the Net Current Asset
Value set forth on the Closing Balance Sheet is greater than U.S.$13,548,000,
the Purchaser shall pay the Parent the Excess Cash in U.S. dollars up to, but
not exceeding, the amount by which the Net Current Asset Value set forth on the
Closing Balance Sheet is greater than U.S.$13,548,000 by wire transfer of
immediately available funds to an account designated by the Parent within
fifteen (15) days following the final determination of the Closing Balance
Sheet.

                  (f) Net French Transfer Tax Liability. As soon as practicable
following the filing of the relevant tax returns for the year ending December
31, 2001, the

                                       17
<PAGE>
Purchaser shall compute the Net French Transfer Tax Liability in U.S. dollars
using the then applicable currency exchange rates (the "Actual Net Liability")
and promptly notify Parent of (i) the amount of the Actual Net Liability, and
(ii) the amount, if any, by which the Actual Net Liability exceeds the Estimated
Net Liability. Within fifteen (15) days following the delivery of such notice to
the Parent, (i) if the Actual Net Liability exceeds the Estimated Net Liability,
the Parent shall pay the amount of such excess to the Purchaser in U.S. dollars,
and (ii) if the Actual Net Liability is less than the Estimated Net Liability,
the Purchaser shall pay the amount of such difference to the Parent in U.S.
dollars.

            2.6 Closing Costs; Transfer Taxes and Fees. (a) The Purchaser shall
be responsible for any documentary and transfer taxes and any sales, use or
other taxes imposed by reason of the transfers of the Purchased Assets provided
hereunder in jurisdictions other than France, and any deficiency, interest or
penalty asserted with respect thereto, and (b) the Parent shall compensate the
Purchaser through a reduction in the Purchase Price as provided in Sections
2.4(a) and 2.5(f) hereof for any documentary and transfer taxes and any sales,
use or other taxes imposed by reason of the transfer of the Purchased Assets
provided hereunder in France (the "French Transfer Tax Liability"), and any
deficiency, interest or penalty asserted with respect thereto. The parties shall
otherwise bear their own expenses as specified in Section 11.10.

                                 ARTICLE III.

                                   CLOSING

            3.1 Closing. The closing of the transactions contemplated herein
(the "Closing") shall take place at the Parent's offices at 147, rue de Paris,
94227 Charenton-Le-Pont, France, on February 2, 2001, or if the conditions set
forth in Articles VII and VIII shall have not been satisfied or waived by such
date (except for conditions set forth in Articles VII and VIII which by their
terms are to be completed at the Closing), as soon as practicable (but in no
event more than ten (10) business days) after such conditions shall have been
satisfied or waived by such date (the "Closing Date").

            3.2 Actions at Closing.

                  (a) Instruments and Possession. To effect the sale and
transfer referred to in Section 2.1 hereof, at the Closing, the Parent will
execute and deliver to the Purchaser or Purchasing Affiliate, or cause to be
executed and delivered to the Purchaser or Purchasing Affiliate by the
respective Company, as the case may be, (i) such documents, assignments,
certificates and deeds as may be reasonably requested by the Purchaser to effect
the transfer of all of the issued and outstanding shares of Sunsoft and to
transfer all of the Purchased Assets to the Purchaser or Purchasing Affiliate,
and (ii) such other documents, assignments, certificates and deeds
(collectively, the "Transfer Documents") necessary to effect such transfers and
to satisfy the Laws of the applicable country to enable the Purchaser or
Purchasing Affiliate, as the case may be, to conduct the Business in such
countries in the manner the Business was conducted by the Sellers prior to the
Closing.

                                       18
<PAGE>
                  (b) Assumption By The Purchaser. Upon the terms and subject to
the conditions contained herein, at the Closing the Purchaser (or at the
election of the Purchaser, one or more Purchasing Affiliates) shall execute and
deliver to the Sellers assignment and assumption agreements, evidencing the
assumption by the Purchaser or the Purchasing Affiliates, as the case may be, of
the Assumed Liabilities pursuant to Section 2.1.

                  (c) Form of Instruments. To the extent that a form of any
document to be delivered hereunder is not attached as an Exhibit hereto, such
documents shall be in form and substance, and shall be executed and delivered in
a manner, reasonably satisfactory to the Purchaser and the Parent.

                  (d) Ancillary Agreements and Transition Services. The
Purchaser, the Purchasing Affiliates and the Sellers shall execute and deliver
the Ancillary Agreements to which they are to be a party, including, but not
limited to, the Transition Services Agreement pursuant to which the Sellers will
provide services to the Purchaser and Purchasing Affiliates for a period of one
year following the Closing to assure an orderly transition of the Business.

                  (e) Certificates; Opinions. The Purchaser and the Sellers
shall deliver the certificates, opinions of counsel and other matters described
in Articles VII and VIII.

                  (f) Consents. The Sellers shall deliver all Permits and any
other third party consents required for the valid transfer of the Purchased
Assets as contemplated by this Agreement.

                                   ARTICLE IV.
                  REPRESENTATIONS AND WARRANTIES OF THE SELLERS

            As an inducement to the Purchaser to enter into this Agreement, the
Parent hereby represents and warrants to the Purchaser and to each Purchasing
Affilate as follows, which representations and warranties are, as of the date
hereof, and will be, as of the Closing Date, true, complete and correct:

            4.1 Organization of the Companies. Each of the Sellers is a company
duly organized, validly existing and in good standing under the Laws of the
jurisdiction of its incorporation or organization with full power and authority
to conduct its business as it is presently being conducted, to own or lease, as
applicable, its Real Property and the applicable Purchased Assets, and to
perform all its obligations under the Contracts to which it is a party. Each of
the Sellers is duly qualified to do business as a foreign company and is in good
standing in each jurisdiction where the character of its properties owned or
leased or the nature of its activities make such qualification necessary, except
where the failure to be so qualified or in good standing would not have a
Material Adverse Effect. Copies of the organizational documents of each of the
Companies heretofore delivered to the Purchaser are accurate and complete as of
the date hereof. Each of the Companies is a Subsidiary of the Parent.

                                       19
<PAGE>
            4.2 Subsidiaries. Other than (a) the Parent's Subsidiary engaged in
the Biolens business in Switzerland, the business of which has been terminated
and which is in the process of being liquidated, (b) the Parent's Subsidiaries
providing distribution services in Austria, Belgium and Italy, (c) the
Companies, (d) Sunsoft Europe Limited ("Sunsoft UK"), (iv) HOC providing
distribution services of contact lens care products in The Netherlands (the "HOC
Contact Lens Business"), the business of which shall be terminated within
eighteen (18) months following the Closing, (v) Essilor Laboratories of America,
Inc.'s rigid gas permeable lens business in the United States, and (vi)
Visionweb Inc.'s internet intermediation services, there are no Subsidiaries of
the Parent which are engaged in any aspect of the conduct of the Business or
which own any of the Purchased Assets.

            4.3 Authorization. Parent has all requisite power and authority, and
upon receipt of the Parent Board Approval described in Section 6.14, will have
taken all action necessary, to execute, deliver and perform this Agreement and
any Ancillary Agreements to which it is a party, to consummate the transactions
contemplated hereby and thereby and to perform its obligations hereunder and
thereunder. Upon receipt of the Parent Board Approval described in Section 6.14,
the execution and delivery of the Ancillary Agreements by the Sellers, and the
consummation by the Sellers of the transactions contemplated hereby and thereby
will have been duly approved by all necessary corporate, company or similar
action. Other than the Parent Board Approval, no other corporate, company or
similar proceedings, including shareholder approval, on the part of the Sellers
are necessary to authorize the execution and delivery of this Agreement and the
Ancillary Agreements by the Sellers and the consummation by the Sellers of the
transactions contemplated hereby and thereby. This Agreement has been duly
executed and delivered by the Parent and is, and upon execution and delivery of
the Ancillary Agreements, this Agreement and the Ancillary Agreements to which
the Sellers are a party will be, the legal, valid and binding obligations of the
Sellers, enforceable against the Sellers in accordance with their terms, except
as enforcement may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium and other Laws affecting enforcement of creditor's
rights generally and except insofar as the availability of equitable remedies
may be limited by applicable Law.

            4.4 Title to Purchased Assets; Condition and Sufficiency of
Purchased Assets. Except as set forth on Schedule 4.4, the Sellers have, and
will transfer to the Purchaser or the Purchasing Affiliate, as applicable, good
and marketable title to the Purchased Assets and upon the consummation of the
transactions contemplated hereby, and assuming the Purchaser has taken all
actions required to be taken by it under this Agreement, the Purchaser or
applicable Purchasing Affiliate will acquire good and marketable title to all of
the Purchased Assets, free and clear of any Encumbrances. The Purchased Assets
together with the Excluded Assets include all property, rights and assets
primarily used in, and necessary for, the operation of the Business as currently
conducted. Except as set forth on Schedule 4.4, all tangible assets and
properties which are part of the Purchased Assets are in good operating
condition and repair, subject to normal wear and tear, and are usable in the
Ordinary Course of Business as currently conducted.

            4.5 Absence of Certain Changes or Events. Since the Interim Balance
Sheet Date:

                                       20
<PAGE>
                  (a) there has been no Material Adverse Change in the Business
and no event or condition has occurred that could reasonably be expected to
result in a Material Adverse Change in the Business;

                  (b) except as expressly contemplated by this Agreement, there
has not been any sale or other disposition, except in the Ordinary Course of
Business of any of the Purchased Assets, or any Encumbrance placed on the
Purchased Assets; and

                  (c) the Sellers have operated the Business in the Ordinary
Course so as to preserve the Business intact, to keep available to the Business
the services of the Sellers' employees, and to preserve the Business and the
goodwill of the Sellers' suppliers, customers, distributors and others having
business relations with them.

            4.6 Contracts and Leases.

                  (a) Schedule 4.6 lists all Material Contracts.

                  (b) "Material Contracts" shall mean the following Contracts:

                        (i) Contracts not made in the Ordinary Course of
Business;

                        (ii) License agreements or royalty agreements, whether
one of the Sellers is the licensor or licensee thereunder;

                        (iii) confidentiality and non-disclosure agreements
(whether one of the Sellers is the beneficiary or the obligated party
thereunder) executed subsequent to January 1, 1996;

                        (iv) agreements involving future expenditures or
Liabilities, actual or potential, or future revenues in excess of 1,000,000
French Francs (or the equivalent of 1,000,000 French Francs in other currencies)
after the date hereof or otherwise material to the Business or the Purchased
Assets;

                        (v) employment agreements, consulting agreements and
severance agreements, including agreements (A) to employ or terminate executive
officers or other personnel and other agreements with present or former officers
or directors of the Sellers with respect to the Business or (B) that will result
in the payment by, or the creation of any Liability to pay on behalf of any of
the Sellers or the Purchaser any severance, termination, "golden parachute," or
other similar payments to any present or former personnel of any of the Sellers
following termination of employment or otherwise as a result of the consummation
of the transactions contemplated by this Agreement and the Ancillary Agreements;

                        (vi) indemnification agreements;

                        (vii) promissory notes, loans, agreements, indentures,
evidences of indebtedness, guarantees, currency or interest rate agreements or
other instruments relating to

                                       21
<PAGE>
an obligation to pay money, whether one of the Sellers shall be the borrower,
lender or guarantor thereunder;

                        (viii) agreements containing covenants limiting the
freedom of any of the Sellers or any officer, director, employee, or other
Affiliates of any of the Sellers, to engage in any line of business or compete
with any Person that relates directly or indirectly to the Business;

                        (ix) any agreement with any foreign, federal, state or
local government or any agency or department thereof;

                        (x) Leases;

                        (xi) any distribution agreements;

                        (xii) letters of credit; and

                        (xiii) any other agreement material to the operation of
the Business.

True, correct and complete copies of all of the Material Contracts which are
written, or written summaries of oral Material Contracts, including all
amendments and supplements thereto, have been made available to the Purchaser.
Each such Material Contract is in full force and effect, paid currently, and has
not been materially impaired by any acts or omissions of any of the Sellers or
any of their Representatives. Except as set forth on Schedule 4.6, no Material
Contract requires the consent of any other contracting party to the transactions
contemplated by this Agreement. The applicable Seller has fulfilled, or taken
all action necessary to enable it to fulfill when due, all of its obligations
under each of such Material Contracts. To the Knowledge of the Sellers, all
other parties to such Material Contracts have complied in all material respects
with the provisions thereof, no party is in Default thereunder and no notice of
any claim of Default has been given to the applicable Seller. The products and
services called for by any unfinished Contract can be, to the Knowledge of the
Sellers, supplied in accordance with the terms of such Material Contract,
including time specifications, and no unfinished Material Contract will upon
performance by the applicable Seller result in a loss to the applicable Company.
To the Knowledge of the Sellers no third party to any Material Contract has any
intent to terminate or amend the terms thereof or to refuse to renew any such
Material Contract upon expiration of its term.

            4.7 Facilities. Schedule 4.7 contains a complete and accurate list
of all Owned Real Property and the identity of the Seller owning such Owned Real
Property and a complete and accurate list of all Facilities and Leased Real
Property and a description of the Leases related to the Leased Real Property.
The Sellers have made available to the Purchaser copies of all Leases related to
Facilities used in connection with the Business.

                  (a) Actions. There are no pending or, to the Knowledge of the
Sellers, threatened condemnation proceedings (e.g., compulsory purchase orders,

                                       22
<PAGE>
appropriation or similar proceedings by governmental entities) or other Actions
relating to any Facility.

                  (b) Leases or Other Agreements With Respect to Owned Real
Property. Except as listed on Schedule 4.7, there are no Leases granting to any
Person the right to purchase, use or occupy any Owned Real Property or any
portion thereof or interest in any such Owned Real Property.

                  (c) Facility Leases and Leased Real Property. With respect to
each Lease listed on Schedule 4.7, the Sellers have an unencumbered interest in
their respective rights under the Leases. The Sellers enjoy peaceful and
undisturbed possession of all the Leased Real Property.

            4.8 Permits. Schedule 4.8 sets forth a complete list of all Permits
used in the operation of the Business, all of which are as of the date hereof,
and all of which will be as of the Closing Date, in full force and effect. The
Sellers have, and to the Knowledge of the Sellers, at all times have had, all
Permits required under any Law relating to the operation of the Business or
relating to the ownership of the Purchased Assets, and own or possess such
Permits free and clear of all Encumbrances. None of the Sellers is in Default
with respect to any such Permit or in violation of the terms of any such Permit,
nor has it received any notice of any claim of Default or violation. Except as
otherwise governed by Law, all such Permits are renewable by their terms or in
the Ordinary Course of Business without the need to comply with any special
qualification procedures or to pay any amounts other than routine filing fees
and no such Permit material to the operation of the Business will be adversely
affected by the completion of the transactions contemplated by this Agreement.
No present or former shareholder, director, officer or employee of the Sellers
or any Affiliate thereof, or any other Person, owns or has any proprietary,
financial or other interest (direct or indirect) in any Permit which the Sellers
own, possess or use. The Sellers have all rights necessary to import and export
products in the jurisdictions in which product has been sold in the past and
have not received any notification, nor to the Knowledge of the Sellers is their
any reason to believe, that such rights will or could be terminated.

            4.9 No Conflict or Violation. Except as set forth on Schedule 4.9
and in connection, or in compliance with, the provisions of the Trade Regulation
Laws, neither the execution, delivery or performance of this Agreement or the
Ancillary Agreements nor the consummation of the transactions contemplated
hereby or thereby, nor compliance by the Sellers with any of the provisions
hereof or thereof, will (a) violate or conflict with any provision of the
articles of incorporation, bylaws, articles of association, memorandum of
association or similar organizational documents of any of the Sellers, (b)
violate, conflict with, or result in or constitute a Default under, or result in
the termination of, or accelerate the performance required by, or result in a
right of termination or acceleration under, any of the terms, conditions or
provisions of any Contract or Permit, (c) violate, conflict with, contravene or
give any Person the right to exercise any remedy or obtain any relief under any
Law or Court Order, or (d) impose any Encumbrance on the Purchased Assets or the
Business.

                                       23
<PAGE>
            4.10 Consents and Approvals. Except as set forth on Schedule 4.10
and except for compliance with the Trade Regulation Laws and notwithstanding the
provisions of Section 6.1(b) hereof, no Consent is required to be made or
obtained by the Sellers or any of their Affiliates in connection with the
execution, delivery and performance by the Sellers of this Agreement and the
Ancillary Agreements and the consummation of the transactions contemplated
hereby and thereby.

            4.11 Financial Information. The Parent has heretofore delivered to
the Purchaser the Financial Statements. The Financial Statements (a) are in
accordance with the books and records of the Sellers, (b) have been prepared in
accordance with GAAP consistently applied throughout the periods covered thereby
and (c) fairly and accurately present the consolidated assets, Liabilities
(including reserves for returned products and warranty claims, asset impairment
reserves and all other reserves) and financial position of the Sellers with
respect to the Business as of the respective dates thereof and the consolidated
results of operations and changes in cash flows for the periods then ended. The
Year-End Financial Statements have been examined PWC, whose report thereon is
included with such Year-End Financial Statements. At the respective dates of the
Financial Statements, there were no Liabilities of the Sellers related to the
Business, which, in accordance with GAAP, should have been set forth or reserved
for in the Financial Statements or the notes thereto, which are not set forth or
reserved for in the Financial Statements or the notes thereto. The reserves set
forth in the Financial Statements for product returns and warranty claims are
adequate to cover future product returns and warranty claims with respect to
products sold on or prior to the date of the Financial Statements.

            4.12 Books and Records. The Sellers have made and kept (and given
the Purchaser access to) their true, correct and complete books and records and
accounts, which, in reasonable detail, accurately and fairly reflect the
activities of the Sellers with respect to the Business. The minute books of the
Companies previously delivered to the Purchaser accurately and adequately
reflect all action previously taken by the shareholders and directors of the
Companies. The copies of share records of each Company previously delivered to
the Purchaser are true and correct, and (a) accurately reflect all transactions
effected in such Company's shares subsequent to the date any of such Company's
shares were acquired by the Parent or its Affiliates and (b) to the Knowledge of
the Sellers, accurately reflect all transactions effected in such Company's
shares prior to the date any of such Company's shares were acquired by the
Parent or its Affiliates; provided, however, that nothing herein to the contrary
shall limit in any manner the representations and warranties set forth in
Section 4.27 hereto. None of the Sellers has engaged in any transaction,
maintained any bank account or used any corporate funds with respect to the
Business except for transactions, bank accounts and funds which have been and
are reflected in such Sellers' books and records and made available to the
Purchaser.

            4.13 Litigation. Except as set forth on Schedule 4.13, there is no
Action pending, or to the Knowledge of the Sellers threatened or anticipated,
(i) against, related to or affecting the Business or the Purchased Assets
(including with respect to Environmental Laws), or (ii) seeking to delay, limit
or enjoin the transactions contemplated by this Agreement or the Ancillary
Agreements. None of the Sellers is in Default with respect to or subject to any
Court Order with respect to the Business, and there are no unsatisfied judgments
against any of the Sellers with respect to the Business or the Purchased Assets.
Except as set forth on Schedule 4.13, there is not a reasonable likelihood of an
adverse determination of any pending Action. Except as set forth on Schedule

                                       24
<PAGE>
4.13, there are no Court Orders or agreements with, or liens by, any
governmental authority or quasi-governmental entity relating to any
Environmental Law which regulate, obligate, bind or in any way affect the
Sellers with respect to the Business or the Purchased Assets.

            4.14 Labor Matters.

                  (a) Except as set forth on Schedule 4.14, in relation to the
Business, none of the Sellers is a party to any labor agreement with respect to
its employees with any labor organization, union, group or association and there
are no employee unions (nor any other similar labor or employee organizations)
under local statutes, custom or practice which pertain to employees of the
Sellers in the Business. In relation to the Business, none of the Sellers has
experienced any attempt by organized labor or its representatives to make such
Seller conform to demands of organized labor relating to its employees or to
enter into a binding agreement with organized labor that would cover the
employees of such Seller. In relation to the Business, there is no labor strike
or labor disturbance pending or threatened against any of the Sellers, nor is
any grievance currently being asserted, and none of the Sellers has experienced
a work stoppage or other labor difficulty, and is not and has not engaged in any
unfair labor practice.

                  (b) Schedule 4.14 sets forth the names and current annual
salary rates or current hourly wages of all employees of the Sellers with
respect to the Business as of the last day of the calendar month preceding the
date hereof (the "Business Employees"). No Business Employee of the Sellers is a
party to, or is otherwise bound by, any agreement or arrangement, including any
confidentiality, non-competition or proprietary rights agreement, between such
employee and any other Person that in any way adversely affects or will affect
the performance of his or her duties as an employee of the Sellers with respect
to the Business or the Purchaser.

            4.15 Liabilities. None of the Sellers has Liabilities related to the
Business, including, but not limited to, Sunsoft Acquisition Liabilities, due or
to become due, except (a) Liabilities which are set forth or reserved for on the
Interim Balance Sheet (b) Liabilities arising in the Ordinary Course of Business
under Contracts, Permits and other business arrangements and (c) Liabilities
incurred since the Interim Balance Sheet Date in the Ordinary Course of Business
and in accordance with this Agreement (none of which relates to any Default
under any Contract or Permit, breach of warranty, tort, infringement or
violation of any Law or Court Order or arose out of any Action) and none of
which, individually or in the aggregate, has had or would have a Material
Adverse Effect.

            4.16 Warranty and Product Liability Matters. Except as set forth in
Schedule 4.16, the Sellers' products and services relating to the Business
comply in all material respects with and meet the standards of all applicable
Contracts and specifications and all applicable Laws, except where any
non-compliance, individually or in the aggregate, would not have a Material
Adverse Effect. Except as set forth in Schedule 4.16, no product or service
warranty or

                                       25
<PAGE>
Liability claims in respect of such products or services are pending or, to the
Knowledge of the Sellers, threatened. There have been no product recalls in the
last four years except as set forth in Schedule 4.16.

            4.17 Compliance with Law. The Sellers in the conduct of the Business
have not violated in any material respect and are in compliance in all material
respects with all Laws and Court Orders relating to the Purchased Assets or the
Business. Except as set forth on Schedule 4.17, the Sellers have not received
any notice to the effect that, or otherwise been advised that, any of the
Sellers is not in compliance with any such Laws or Court Orders, and the Sellers
have no reason to anticipate that any existing circumstances are likely to
result in violations of any of the foregoing.

            4.18 No Brokers. Except as set forth on Schedule 4.18, none of the
Sellers nor any of their Representatives has entered into or will enter into any
contract, agreement, arrangement or understanding with any broker, finder or
similar agent or any Person which will result in the obligation of the Purchaser
or any of its Affiliates to pay any finder's fee, brokerage fees or commission
or similar payment in connection with the transactions contemplated hereby.

            4.19 Proprietary Rights.

                  (a) Schedule 4.19 sets forth: (i) for each of the Sellers'
Patents related to the Business, the number, normal expiration date and subject
matter for each country in which such Patent has been issued, or, if applicable,
the application number, date of filing and subject matter for each country; (ii)
for each of the Sellers' registered Trademarks related to the Business and for
each Trademark application related to the Business, the application serial
number or registration number, the class of goods covered and the expiration
date for each country in which any such Trademark has been registered; (iii) for
each of the Sellers' registered Copyrights related to the Business and for each
Copyright application related to the Business, the number and date of filing for
each country in which such a Copyright has been filed, and (iv) a list of domain
names of each of the Sellers related to the Business. True and correct copies of
all Patents related to the Business (including all pending applications) owned,
controlled, created or used by or on behalf of the Sellers or in which any of
the Sellers has any interest whatsoever have been provided to the Purchaser.

                  (b) The Sellers own or have the valid right or license to
make, use, possess, sell, reproduce, distribute, prepare derivative works of,
publicly display or license, all Proprietary Rights necessary or required for
the conduct of the Business, and such rights to use, possess, sell or license
are sufficient for the conduct of the Business as presently conducted and such
Proprietary Rights will become rights of the Purchaser upon consummation of the
transactions contemplated hereby.

                  (c) Neither the execution, delivery and performance of this
Agreement nor the consummation of the transactions contemplated hereby will
impair the right of the Purchaser to use, possess, sell or license any
Proprietary Rights or any portion thereof. There are no royalties, honoraria,
fees or other payments payable by the Sellers

                                       26
<PAGE>
to any third person by reason of the ownership, use, possession, license, sale,
marketing, advertising or disposition of any Proprietary Rights.

                  (d) Neither the manufacture, marketing, license, sale,
furnishing or intended use of any product or service related to the Business
currently licensed, utilized, sold, provided or furnished by the Sellers
violates any license or agreement between the Sellers and any third party or
infringes or misappropriates any proprietary rights of any other party; and
there is no pending or, to the Knowledge of the Sellers, threatened claim or
litigation contesting the validity, ownership or right of the Sellers to use,
possess, sell, market, advertise, license or dispose of any Proprietary Rights
nor, to the Knowledge of the Sellers, is there any valid basis for any such
claim, nor have the Sellers received any notice asserting that any Proprietary
Right or the proposed use, sale, license or disposition thereof conflicts or
will conflict with the rights of any other party, nor, to the Knowledge of the
Sellers, is there any valid basis for any such assertion.

                  (e) To the Knowledge of the Sellers, no employee, consultant
or independent contractor of the Sellers: (i) is in violation of any term or
covenant of any employment contract, patent disclosure agreement, invention
assignment agreement, non-disclosure agreement, noncompetition agreement or any
other contract or agreement with any other party by virtue of such employee's,
consultant's, or independent contractor's being employed by, or performing
services for, the Sellers in the conduct of the Business or using trade secrets
or proprietary information of others in the conduct of the Business, or that
would have a Material Adverse Effect on the Business; or (ii) has developed any
technology, software or other copyrightable, patentable, or otherwise
proprietary work for the Sellers relating to the Business that is subject to any
agreement under which such employee, consultant or independent contractor has
assigned or otherwise granted to any third party any rights (including without
limitation Proprietary Rights) to such technology, software or other
copyrightable, patentable or otherwise proprietary work. To the Knowledge of the
Sellers, the employment of any employee of the Sellers or the use by the
Purchaser of the services of any consultant or independent contractor of the
Sellers utilized in the Business does not subject the Purchaser to any liability
to any third party.

                  (f) The Sellers have taken reasonably necessary and
appropriate steps to protect, preserve and maintain the secrecy and
confidentiality of the Proprietary Rights. All officers, employees and
consultants of the Sellers or any Affiliate of the Sellers having access to
confidential information of the Sellers relating to the Business, have executed
and delivered to the Sellers an agreement regarding the protection of such
proprietary information, and copies of the form of all such agreements have been
delivered to the Purchaser. Neither Charles Briggs nor any employee or
consultant of the Sellers, owns or has any rights with respect to any
Proprietary Rights.

                  (g) Schedule 4.19 contains a complete list of (i) all
licenses, sublicenses and other agreements as to which the Sellers or any
Affiliate of the Sellers is a party and pursuant to which any Person is
authorized to use any Proprietary Rights, and

                                       27
<PAGE>
(ii) all licenses, sublicenses and other agreements as to which the Sellers or
any Affiliate of the Sellers is a party and pursuant to which the Sellers or any
Affiliate of the Sellers is authorized to use any third party Patents,
Trademarks, Internet domain names, internet or world wide web URLs or addresses,
or Copyrights and which are material to the Business.

                  (h) To the Knowledge of the Sellers, there is no material
unauthorized use, disclosure, infringement or misappropriation of any
Proprietary Rights by any third party, including any employee or former employee
of the Sellers or any Affiliate of the Sellers. The Sellers have not agreed to
indemnify any Person for any infringement of any proprietary right of any third
party by any product or service that has been sold, licensed, leased, supplied,
marketed, distributed, or provided by the Sellers relating to the Business.

            4.20  Employee Plans and Employee Matters.

                  (a) Schedule 4.20 lists each employee benefit fund, plan,
program, arrangement and Contract (including, without limitation, any "pension"
plan, fund or program, as defined in Section 3(2) of ERISA, and any "employee
benefit plan," as defined in Section 3(3) of ERISA and any plan, program,
arrangement or Contract providing for severance; medical, dental or vision
benefits; life insurance or death benefits; disability benefits, sick pay or
other wage replacement; vacation, holiday or sabbatical; pension or
profit-sharing benefits; stock options or other equity compensation; bonus or
incentive pay or other material fringe benefits), whether written or not
("Employee Plans"), maintained, sponsored or contributed to or required to be
contributed to by Sunsoft (the "Sunsoft Employee Plans"). With respect to each
Sunsoft Employee Plan, the Sellers have delivered or made available to the
Purchaser a true, complete and correct copy of (i) such Sunsoft Employee Plan
(or, if not written, a written summary of its material terms) and the most
recent summary plan description, if any, related to such Sunsoft Employee Plan,
(ii) each trust agreement or other funding arrangement relating to such Sunsoft
Employee Plan, (iii) the most recent annual report (Form 5500) filed with the
United States Internal Revenue Service (the "IRS") with respect to such Sunsoft
Employee Plan (and, if the most recent annual report is a Form 5500R, the most
recent Form 5500C filed with respect to such Sunsoft Employee Plan), (iv) the
most recent actuarial report or financial statement relating to such Sunsoft
Employee Plan and (v) the most recent determination letter, if any, issued by
the IRS with respect to such Sunsoft Employee Plan and any pending request for
such a determination letter. Neither Sunsoft, nor any other person or entity,
has any express or implied commitment, whether legally enforceable or not, to
modify, change or terminate any Sunsoft Employee Plan, other than with respect
to a modification, change or termination required by ERISA or the Code.

                  (b) Each Sunsoft Employee Plan has been administered in all
material respects in accordance with its terms and all applicable Laws,
including ERISA and the Code, and contributions required to be made under the
terms of any of the Sunsoft Employee Plans as of the date of this Agreement have
been timely made or, if

                                       28
<PAGE>
not yet due, have been properly reflected on the most recent consolidated
Balance Sheet filed or incorporated by reference in the Financial Statements
prior to the date of this Agreement. With respect to the Sunsoft Employee Plans,
no event has occurred and there exists no condition or set of circumstances in
connection with which Sunsoft could be subject to any material Liability (other
than for routine benefit Liabilities) under the terms of, or with respect to,
such Sunsoft Employee Plans, ERISA, the Code or any other applicable Law.

                  (c) Parent on behalf of Sunsoft and each Sunsoft ERISA
Affiliate hereby represents that: (i) each Sunsoft Employee Plan which is
intended to qualify under Section 401(a), Section 401(k), Section 401(m) or
Section 4975(e)(6) of the Code has received a favorable determination letter
from the IRS as to its qualified status, and each trust established in
connection with any Sunsoft Employee Plan which is intended to be exempt from
federal income taxation under Section 501(a) of the Code has received a
determination letter from the IRS that it is so exempt, and no fact or event has
occurred that could adversely affect the qualified status of any such Sunsoft
Employee Plan or the exempt status of any such trust; (ii) there has been no
prohibited transaction (within the meaning of Section 406 of ERISA or Section
4975 of the Code and other than a transaction that is exempt under a statutory
or administrative exemption) with respect to any Sunsoft Employee Plan that
could result in Liability to the Sunsoft or a Sunsoft ERISA Affiliate and (iii)
each Sunsoft Employee Plan can be amended, terminated or otherwise discontinued
after the Closing in accordance with its terms, without Liability (other than
(A) Liability for ordinary administrative expenses typically incurred in a
termination event or (B) if the Sunsoft Employee Plan is a pension benefit plan
subject to Part 2 of Title I of ERISA, Liability for the accrued benefits as of
the date of such termination (if and to the extent required by ERISA) to the
extent that either there are sufficient assets set aside in a trust or insurance
Contract to satisfy such Liability or such Liability is reflected on the most
recent balance sheet included in the Financial Statements prior to the date of
this Agreement). No suit, administrative proceeding, action or other litigation
has been brought or is threatened, against or with respect to any such Sunsoft
Employee Plan, including any audit or inquiry by the IRS or United States
Department of Labor (other than routine benefits claims).

                  (d) No Sunsoft Employee Plan is a multiemployer pension plan
(as defined in Section 3(37) of ERISA) or other pension plan subject to Title IV
of ERISA and neither Sunsoft nor any other trade or business (whether or not
incorporated) that is under "common control" with Sunsoft (within the meaning of
ERISA Section 4001) or with respect to which Sunsoft could otherwise incur
Liability under Title IV of ERISA (a "Sunsoft ERISA Affiliate") has sponsored or
contributed to or been required to contribute to a multiemployer pension plan or
other pension plan subject to Title IV of ERISA. No material Liability under
Title IV of ERISA has been incurred by Sunsoft or any Sunsoft ERISA Affiliate
that has not been satisfied in full, and no condition exists that presents a
material risk to Sunsoft or any Sunsoft ERISA Affiliate of incurring or being
subject (whether primarily, jointly or secondarily) to a material Liability
thereunder. None of the assets of Sunsoft or any Sunsoft ERISA Affiliate is, or
may

                                       29
<PAGE>
reasonably be expected to become, the subject of any lien arising under ERISA or
Section 412(n) of the Code.

                  (e) With respect to each Employee Plan required to be set
forth in Schedule 4.20 that is subject to Title IV or Part 3 of Title I of ERISA
or Section 412 of the Code, (i) no reportable event (within the meaning of
Section 4043 of ERISA, other than an event that is not required to be reported
before or within 30 days of such event) has occurred or is expected to occur,
(ii) there was not an accumulated funding deficiency (within the meaning of
Section 302 of ERISA or Section 412 of the Code), whether or not waived, as of
the most recently ended plan year of such Sunsoft Employee Plan; and (iii) there
is no "unfunded benefit liability" (within the meaning of Section 4001(a)(18) of
ERISA).

                  (f) Except as required by Law, no Sunsoft Employee Plan
provides any of the following retiree or post-employment benefits to any person:
medical, disability or life insurance benefits. Sunsoft and the Sunsoft ERISA
Affiliates are in compliance with (i) the requirements of the applicable health
care continuation and notice provisions of the United States Consolidated
Omnibus Budget Reconciliation Act of 1985, as amended ("COBRA") and the
regulations (including proposed regulations) thereunder and (ii) the applicable
requirements of the Health Insurance Portability and Accountability Act of 1996,
as amended, and the regulations (including the proposed regulations) thereunder.

                  (g) Schedule 4.20 lists each Employee Plan which is
contributed to or required to be maintained by the Law or applicable custom,
collective bargaining agreement, or rule of the relevant jurisdiction outside of
the United States for the benefit of any of the employees engaged in the conduct
of the Business (the "Foreign Plans"). With respect to the Foreign Plans: (i)
each of the Foreign Plans is in compliance with the provisions of the Laws of
each jurisdiction in which each such Foreign Plan is maintained, to the extent
those Laws are applicable to the Foreign Plans; (ii) all contributions to, and
payments from, the Foreign Plans which may have been required to be made in
accordance with the terms of any such Foreign Plan, and, when applicable, the
Law of the jurisdiction in which such Foreign Plan is maintained, have been
timely made or shall be made by the Closing. All such contributions to the
Foreign Plans, and all payments under the Foreign Plans, for any period ending
before the Closing are not yet, but will be, required to be made, are reflected
as an accrued Liability on the Balance Sheet; (iii) all reports, returns and
similar documents, if any, with respect to any Foreign Plan required to be filed
with any governmental body or distributed to any Foreign Plan participant have
been duly and timely filed or distributed or will be filed or distributed by the
Closing, and all of the Foreign Plans have obtained from the governmental body
having jurisdiction with respect to such plans any required determinations, if
any, that such Foreign Plans are in compliance with the laws of the relevant
jurisdiction if such determinations are required in order to give effect to the
Foreign Plan; (iv) each of the Foreign Plans has been administered at all times
in accordance with its terms. To the Knowledge of the Sellers, there are no
pending investigations by any governmental body involving the Foreign Plans, and
no pending claims (except for claims for benefits

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<PAGE>
payable in the normal operations of the Foreign Plans), suits or proceedings
against any Foreign Plan or asserting any rights or claims to benefits under any
Foreign Plan; and (v) the consummation of the transactions contemplated by this
Agreement will not by itself create or otherwise result in any Liability with
respect to any Foreign Plan other than the triggering of payment to
participants.

                  (h) The Sellers are in compliance in all material respects
with all currently applicable Laws and regulations respecting employment,
discrimination in employment, terms and conditions of employment, wages, hours
and occupational safety and health and employment practices, and are not engaged
in any unfair labor practice with respect to the Business Employees. The Sellers
have withheld all amounts required by Law or by agreement to be withheld from
the wages, salaries, and other payments to employees; and are not liable for any
arrears of wages or any Taxes or any penalty for failure to comply with any of
the foregoing with respect to the Business Employees. The Sellers are not liable
for any payment to any trust or other fund or to any governmental entity, with
respect to unemployment compensation benefits, social security or other benefits
or obligations for employees (other than routine payments to be made in the
Ordinary Course of Business) with respect to the Business Employees. There are
no material pending claims against the Sellers under any workers compensation
plan or policy or for long term disability with respect to the Business
Employees. Except as set forth in Schedule 4.13, there are no material
controversies pending or, to the Knowledge of the Sellers, threatened, between
the Sellers and any of the Business Employees, which controversies have or could
reasonably be expected to result in an action, suit, proceeding, claim,
arbitration or investigation before governmental entity. Except as disclosed on
Schedules 4.14 or 4.20, the Sellers are not parties to any collective bargaining
agreement or other labor union Contract with respect to the Business Employees
nor do the Companies know of any activities or proceedings of any labor union to
organize any of the Business Employees.

                  (i) The Sellers have delivered or made available to the
Purchaser true, complete and correct copies of the following documents with
respect to Sunsoft and any of the Business Employees: (i) all employment
agreements with officers and all consulting agreements, (ii) all written
severance plans, agreements, programs, stock option plans and policies with or
relating to the Business Employees and directors or consultants of Sunsoft, and
(iii) all written plans, programs, agreements and other arrangements relating to
Business Employees which contain "change of control" provisions. No payment or
benefit which may be required to be made by the Sellers or Sunsoft or which
otherwise may be required to be made under the terms of any Sunsoft Employee
Plan or Foreign Plan or other arrangement, including, but not limited to, any
payments or benefits made in respect of the acquisition by Parent or its
Affiliates of Sunsoft, will constitute or has constituted, a parachute payment
under Section 280G(1) of the Code, and the consummation of the transactions
contemplated by this Agreement will not, alone or in conjunction with any other
possible event (including termination of employment), (i) entitle any current or
former employee or other service provider of Sunsoft or the Business to
severance benefits or any other payment, compensation or benefit (including
forgiveness of indebtedness), except as expressly provided by this

                                       31
<PAGE>
Agreement, or (ii) accelerate the time of payment or vesting, or increase the
amount of compensation or benefit due any such employee or service provider.

            4.21 Transactions with Certain Persons; Parent Agreements.

                  (a) No officer, director, employee or other Affiliate of any
of the Sellers nor any member of any such Person's immediate family is presently
a party to any transaction with any of the Sellers related to the Business,
including, without limitation, any Contract (i) providing for the furnishing of
services by, (ii) providing for the rental of real or personal property from or
(iii) otherwise requiring payments to (other than for services as officers,
directors or employees of any of the Sellers) any such Person or corporation,
partnership, trust or other entity in which any such Person has an interest as a
shareholder, officer, director, trustee or partner, except as listed in Schedule
4.21(a). Any transactions set forth on Schedule 4.21(a) were the result of
arm's-length negotiations.

                  (b) Except as set forth on Schedule 4.21(b), there are no
Contracts between the Parent or an Affiliate of the Parent and any one or more
of the Companies or Sunsoft UK (collectively, the "Parent Agreements") that will
be effective following the Closing.

            4.22 Tax Matters.

                  (a) All Tax Returns required to be filed prior to the Closing
Date with respect to the Business have been timely, properly and accurately
completed and filed on or prior to the date hereof. The Sellers do not currently
have in effect a filed or requested extension of time to file any Tax Return
with respect to the Business that would have been due but for an extension of
time. With respect to all amounts in respect of Taxes imposed on or with respect
to the Business transferred to the Purchaser or for which the Business
transferred to the Purchaser is or could be liable, whether to taxing
authorities (as, for example, under Tax Laws) or to other Persons (as, for
example, under Tax allocation agreements), with respect to all taxable periods
or portions of periods ending on or before the Closing, all applicable Tax Laws
and agreements have been fully complied with in preparing Tax Returns or
otherwise, and all such amounts relating to the Business transferred to the
Purchaser required to be paid by the Sellers to taxing authorities or others on
or before the date hereof have been paid. For purposes of this Section 4.22(a),
Tax Returns or Taxes with respect to, imposed on, or relating to the Business
shall include Tax Returns required to be filed by or on behalf of Sunsoft or
Sunsoft UK or Taxes required to be paid by Sunsoft or Sunsoft UK (including any
applicable withholding Tax). There are no liens for Taxes on the Purchased
Assets. There is no outstanding or unsettled notice of deficiency or assessment
or any audit proceeding with respect to Taxes relating to the Purchased Assets
or Taxes for which Sunsoft or Sunsoft UK may be liable. None of the Purchased
Assets or assets of Sunsoft or Sunsoft UK is treated as owned by another Person
under the so-called safe harbor lease provisions of former Section 168(f) of the
Code (or similar provisions of any applicable foreign Tax Laws), constitutes
"tax-exempt use property" within the meaning

                                       32
<PAGE>
of Section 168(h) (1) of the Code (or is subject to similar provisions under any
applicable foreign Tax Laws), or is tax-exempt bond financed property within the
meaning of Section 168(g) of the Code (or is subject to similar provisions under
any applicable foreign Tax Laws). Schedule 4.22(a) lists all material elections
relating to Tax that would apply to the Purchased Assets after the Closing.

                  (b) Neither Sunsoft nor Sunsoft UK is a party to, is bound by,
or has any obligation under, any Tax sharing agreement, Tax indemnification
agreement or similar Contract or arrangement. No power of attorney has been
granted with respect to Sunsoft or Sunsoft UK as to any matter relating to
Taxes. Neither Sunsoft nor Sunsoft UK has filed a consent pursuant to Section
341(f) of the Code (or any predecessor provision) or a similar provision under
the foreign Tax Laws. Neither Sunsoft nor Sunsoft UK has any Liability for Taxes
of any Person pursuant to Treasury Regulation Section 1.1502-6 (or any similar
provision of state, local or foreign law) other than, in the case of Sunsoft,
for the consolidated return group of which Parent US Sub is the parent.

                  (c) Sunsoft UK has no investment in United States property
within the meaning of Section 956 of the Code and is not a passive foreign
investment company within the meaning of the Code. With respect to Sunsoft UK,
Schedule 4.22(c) sets forth the amount of current and accumulated earnings and
profits and the amount of previous Tax earnings and profits (within the meaning
of Section 959 of the Code) as of the date hereof. The Purchaser (or Sunsoft)
would not be required to include any amount in gross income with respect to
Sunsoft pursuant to Section 951 of the Code if the taxable year of Sunsoft UK
were deemed to end on the Closing Date.

            4.23 Computer Software. The computer software currently utilized in
the Business is capable of meeting the needs of the Business and adequately
performs the functions for which it is used, and to the Knowledge of the
Sellers, contains no defects.

            4.24 Accounts Receivable. The accounts receivable set forth on the
Interim Balance Sheet, and all accounts receivable arising since the Interim
Balance Sheet Date, represent bona fide claims of the Sellers against debtors
for sales, services performed or other events arising on or before the date
hereof, and all the goods delivered and services performed which gave rise to
said accounts were delivered or performed in accordance with the applicable
orders, Contracts or customer requirements. Said accounts receivable are subject
to no defenses, counterclaims or rights of setoff and are fully collectible in
the Ordinary Course of Business within six months of the date of the sale, or
with respect to those accounts receivable listed on Schedule 4.24, within the
time period specified on Schedule 4.24, service or other event, without cost in
collection efforts therefor in excess in the aggregate of U.S.$10,000, except to
the extent of the appropriate reserves for bad debts on accounts receivable as
set forth on the Interim Balance Sheet and, in the case of accounts receivable
arising since the Interim Balance Sheet Date, to the extent of a reasonable
reserve rate for bad debts on accounts receivable which is not greater than the
rate reflected by the reserve for bad debts on the Interim Balance Sheet.

            4.25 Inventory. Schedule 4.25 contains a complete and accurate list
of all Inventory set forth on the Interim Balance Sheet and, in the case of
Sunsoft, as at September 30,

                                       33
<PAGE>
2000, and the addresses at which the Inventory is located. The Inventory as set
forth on the Interim Balance Sheet or arising since the Interim Balance Sheet
Date was acquired and has been maintained in accordance with the regular
business practices of the Sellers, consists of new and unused items of a quality
and quantity usable or saleable in the Ordinary Course of Business, and is
valued at reasonable amounts based on the normal valuation policy of the Sellers
at prices equal to the weighted average cost method or the lower of cost or
market value on a first-in-first-out basis as specified for each Seller in the
Financial Statements. None of such Inventory includes Excess Inventory, except
for such items of Inventory which have been written down to realizable market
value, or for which adequate reserves have been provided, in the Interim Balance
Sheet.

            4.26 Compliance With Environmental Laws. Except as set forth in
Schedule 4.26, (a)(i) there is and has been no Handling of Substances by any of
the Sellers or their Affiliates, at, on, or from any Operating Site in violation
of any applicable Environmental Law or that has resulted in any Liability to any
of the Sellers under any Environmental Law, and (ii) there is and has been no
Handling Substances at, on, from any Operating Site, by any other Person that
has resulted in any Liability or potential Liability to any of the Sellers under
any Environmental Law; (b) no Substances are present on, in or under any
Operating Site, regardless of how the Substance or Substances came to rest
there, in violation of any applicable Environmental Law; (c)(i) no underground
tanks are or have been owned or operated by any of the Sellers with respect to
the Business, (ii) no underground storage tanks are or have been located on, in
or under any Facility currently owner or leased by any of the Sellers, (iii) no
PCBs or asbestos-containing materials are located on, in or under any Facility
currently owned or leased by any of the Sellers; (d)(i) the Sellers have not
received written or oral notice of any assertion by any governmental or
regulatory agency or other Person that any of them may be a potentially
responsible party in connection with any Substance disposal site related to the
Business, and (ii) the Sellers have not received written or oral notice of any
pending or threatened claims or any reasonable basis for a claim by any Person
against any of the Sellers under any Environmental Law; (e) no Encumbrances have
been, or are, imposed on the Business or any of the Purchased Assets under any
Environmental Law; and (f) the Sellers have obtained all Permits and have made
all reports and notifications required under any Environmental Law in connection
with the Purchased Assets and the operation of the Business, and are in
compliance with all applicable Environmental Laws. Schedule 4.26 also contains a
list and brief description of all filings by the Sellers with, notices to any of
the Sellers from, and related reports to any governmental authority
administering an Environmental Law including without limitation, filings made,
corrective action taken, or citations and notices of violations received by any
of the Sellers, with respect to any Operating Site.

            4.27 Ownership of Sunsoft Shares and Sunsoft UK Shares.

                  (a) Parent US Sub owns all of the equity interests in Sunsoft,
consisting of 1,334 shares of common stock of Sunsoft. The outstanding shares of
Sunsoft to be transferred to the Purchaser or Purchasing Affiliate as provided
in Section 2.1 hereof are duly authorized and validly issued and constitute all
of the issued and outstanding shares of Sunsoft. There are no outstanding (i)
securities convertible into or exchangeable for equity shares of Sunsoft, (ii)
options, warrants or other rights to

                                       34
<PAGE>
purchase or subscribe for equity shares of Sunsoft, or (iii) obligations of
Sunsoft to issue any additional equity shares.

                  (b) Sunsoft owns all of the equity interests in Sunsoft UK,
consisting of 100 shares of equity of Sunsoft UK. The outstanding shares of
Sunsoft UK are duly authorized and validly issued and there are no outstanding
(i) securities convertible into or exchangeable for equity shares of Sunsoft UK,
(ii) options, warrants or other rights to purchase or subscribe for equity
shares of Sunsoft UK, or (iii) obligations of Sunsoft UK to issue any additional
equity shares. Sunsoft UK is duly organized, validly existing and in good
standing under the Laws of the United Kingdom. Except for the employment
agreement between Sunsoft UK and Peter Day, dated October 9, 1988, Sunsoft UK
owns no Purchased Assets and has no Liabilities.

            4.28 No Other Agreements to Sell the Business or the Purchased
Assets. None of the Sellers nor any of their Representatives have any commitment
or legal obligation, absolute or contingent, to any other Person other than
Purchaser to sell, assign, transfer or effect a sale of any of the Purchased
Assets or the Business (other than inventory in the Ordinary Course of
Business), to sell or effect a sale of a majority of the equity shares of such
Seller, to effect a merger, consolidation, liquidation, dissolution or other
reorganization of such Seller, or to enter into any agreement or cause the
entering into of any agreement with respect to any of the foregoing.

            4.29 Material Misstatements or Omissions. No representations or
warranties by the Sellers in this Agreement, nor any document, exhibit,
statement, certificate or schedule heretofore or hereafter furnished to the
Purchaser pursuant hereto, or in connection with the transactions contemplated
hereby, including without limitation the Disclosure Schedule, contains or will
contain any untrue statement of a material fact, or omits or will omit to state
any material fact necessary to make the statements or facts contained therein
not misleading.
            4.30 Sunsoft Agreements; Absence of Agreements and Liabilities. Each
of that certain Shareholders Agreement dated as of March 6, 1987 among Sunsoft,
Charles Briggs and Parent US Sub (as the same may have been supplemented,
amended or modified) (the "Sunsoft Shareholders Agreement") and the Employment
Agreement dated as of March 6, 1987 by and between Sunsoft and Charles Briggs
(as the same may have been supplemented, amended or modified) (the
"Sunsoft/Briggs Employment Agreement") have been terminated and are of no
continuing force or effect, and all obligations of the parties thereunder have
been discharged in full in accordance with the respective terms of the Sunsoft
Shareholders Agreement and the Sunsoft/Briggs Employment Agreement. Except for
those certain lease agreements between Sunsoft and Charles Briggs for the
properties located at 6805 Academy Parkway West NE, Albuquerque, NM, 6814
Academy Parkway West NE, Albuquerque, NM and 6815 Academy Parkway West NE,
Albuquerque, NM, Sunsoft is not a party to any Contract with Charles Briggs and
has no Liability to Charles Briggs. Except as set forth on Schedule 4.21(b),
there are no Contracts between Sunsoft, on the one hand, and any Seller or any
Affiliate of a Seller, on the other hand.

                                       35
<PAGE>
                                   ARTICLE V.
                 REPRESENTATIONS AND WARRANTIES OF THE PURCHASER

            As an inducement to the Sellers to enter into this Agreement, the
Purchaser hereby represents and warrants to the Sellers, which representations
and warranties are, as of the date hereof, and will be, as of the Closing Date,
true, complete and correct:

            5.1 Organization of the Purchaser. The Purchaser is duly organized,
validly existing and in good standing under the Laws of the State of Delaware.
On the Closing Date, each Purchasing Affiliate, if any, will be duly organized,
validly existing and in good standing under the Laws of its jurisdiction of
organization.

            5.2 Authorization. The Purchaser has, and each Purchasing Affiliate
will have prior to the Closing, all requisite power and authority under
applicable law, and the Purchaser has taken or prior to the Closing will have
taken all action necessary, to execute and deliver this Agreement and the
Ancillary Agreements (or to cause the Purchasing Affiliates to execute and
deliver the Ancillary Agreements), to consummate the transactions contemplated
hereby and thereby and to perform its (or their) obligations hereunder and
thereunder. The execution and delivery of this Agreement and the Ancillary
Agreements by the Purchaser (or the Purchasing Affiliates, as the case may be)
and the consummation by the Purchaser (or the Purchasing Affiliates, as the case
may be) of the transactions contemplated hereby and thereby have been (or in the
case of the Purchasing Affiliates, will have been prior to Closing) duly
approved by the board directors of the Purchaser (and to the extent necessary,
by the appropriate representatives of the Purchasing Affiliates). No other
proceedings on the part of the Purchaser, including shareholder approval, are
necessary to authorize this Agreement and the Ancillary Agreements and the
transactions contemplated hereby and thereby. This Agreement has been duly
executed and delivered by the Purchaser and is, and upon execution and delivery
of this Agreement and the Ancillary Agreements will be, a legal, valid and
binding obligation of the Purchaser (or in the case of the Ancillary Agreements
executed by a Purchasing Affiliate, a legal, valid and binding obligation of the
Purchasing Affiliate), enforceable against the Purchaser (or the Purchasing
Affiliate, as the case may be) in accordance with its terms, except as
enforcement may be limited by applicable bankruptcy, insolvency, reorganization,
moratorium and other Laws affecting enforcement of creditor's rights generally
and except insofar as the availability of equitable remedies may be limited by
applicable Law.

            5.3 No Conflict or Violation. Except as set forth on Schedule 5.3
and in connection, or in compliance with, the provisions of the Trade Regulation
Laws, neither the execution, delivery or performance of this Agreement or the
Ancillary Agreements nor the consummation of the transactions contemplated
hereby or thereby, nor compliance by the Purchaser (or any Purchasing Affiliate)
with any of the provisions hereof or thereof, will (a) violate or conflict with
any provision of the Purchaser's certificate of incorporation or bylaws (or
comparable charter documents of the Purchasing Affiliates), (b) violate,
conflict with, or result in or constitute a Default under, or result in the
termination of, or accelerate the performance required by, or result in a right
of termination or acceleration under, any of the terms, conditions or provisions
of any agreement, contract, obligation, promise or undertaking that is legally
binding on the Purchaser (or any Purchasing Affiliate), or (c) violate, conflict
with, contravene or

                                       36
<PAGE>
give any Person the right to exercise any remedy or obtain any relief under any
Law or Court Order.

            5.4 Consents and Approvals. Except as set forth on Schedule 5.4 and
in connection, or in compliance with, the provisions of the Trade Regulation
Laws, no Consent is required to be made or obtained by the Purchaser or any
Purchasing Affiliate in connection with the execution, delivery and performance
by the Purchaser or any Purchasing Affiliate of this Agreement and the Ancillary
Agreements and the consummation of the transactions contemplated hereby and
thereby.

            5.5 No Brokers. Except as set forth on Schedule 5.5, neither the
Purchaser nor any of its Representatives has entered into or will enter into any
contract, agreement, arrangement or understanding with any broker, finder or
similar agent or any Person which will result in the obligation of the Sellers
or any of their respective Affiliates to pay any finder's fee, brokerage fees or
commission or similar payment in connection with the transactions contemplated
hereby.

                                   ARTICLE VI.
                            COVENANTS AND AGREEMENTS

            6.1 Further Assurances.

                  (a) Upon the terms and subject to the conditions contained
herein, the parties have proceeded with the negotiation and preparation of this
Agreement in good faith and agree (i) to continue to act in good faith and to
use all reasonable efforts to take, or cause to be taken, all actions and to do,
or cause to be done, all things necessary, proper or advisable to consummate and
make effective the transactions contemplated by this Agreement, (ii) to execute
any documents, instruments or conveyances of any kind which may be reasonably
necessary or advisable to carry out any of the transactions contemplated
hereunder, and (iii) to cooperate with each other in connection with the
foregoing. Without limiting the foregoing, the parties agree to use all
reasonable efforts (A) to obtain all Consents necessary or desirable to
consummate the transactions provided for herein and in the Ancillary Agreements
and all Consents necessary or desirable in order that the Purchaser can conduct
the Business after the Closing Date substantially in the same manner as the
Business was conducted by the Sellers before the Closing Date; provided, however
that the Purchaser shall not be required to make any payments, commence
litigation or agree to modifications of the terms of any arrangements in order
to obtain any such Consents, (B) to obtain all necessary Permits as are required
to be obtained under any Laws, (C) to give all notices to, and make all
registrations and filings with third parties, including without limitation
submissions of information requested by governmental authorities, and (D) to
fulfill all conditions to this Agreement. As soon as reasonably practicable
after the execution and delivery of this Agreement, the Purchaser and the
Sellers shall make all filings required under Trade Regulation Laws applicable
to the transactions contemplated hereunder.

                                       37
<PAGE>
                  (b) Notwithstanding the foregoing in Section 6.1(a), this
Agreement shall not constitute an agreement to assign or transfer any rights or
assume any obligations under any Contract comprising a Purchased Asset, or any
claim, right, benefit or obligation arising thereunder or resulting therefrom,
if an attempted assignment, transfer or assumption thereof, without the required
Consent of any third party, would constitute a breach or default thereof or
would have a material adverse effect on the rights or privileges of the
Purchaser or the Sellers thereunder. Any such assignment, transfer or assumption
where a third party's Consent is required shall be made subject to such Consent
being obtained, the acquisition of which shall be the sole responsibility of the
Sellers, who will use all commercially reasonable efforts to obtain such
Consents, provided that the Purchaser shall provide reasonable assistance and
cooperation in connection with the acquisition of such Consents. Pending receipt
of such Consent, (i) the respective Seller will hold such rights in trust for,
and for the benefit of, the Purchaser or Purchasing Affiliate, and will
cooperate with the Purchaser in any reasonable arrangement necessary to provide
that the Purchaser or Purchasing Affiliate shall receive substantially all
beneficial interest and benefits in, to and under such Purchased Asset; and (ii)
pursuant to a mutually satisfactory written agreement, the respective Seller
shall engage the Purchaser or Purchasing Affiliate to act as such Seller's
independent contractor to perform, and the Purchaser or Purchasing Affiliate
will so perform, such Seller's obligations under such Contract comprising a
Purchased Asset. Each agreement specified in clause (ii) of the preceding
sentence will contain such terms and provisions as to provide for a de facto
assignment, transfer and assumption of all of the Liabilities of such Seller to
and by the Purchaser or Purchasing Affiliate under such Contract without
violating the contractual obligations of such Seller. In the event that,
pursuant to a Contract comprising a Purchased Asset (i) payment for the account
of the Purchaser or Purchasing Affiliate is made to such Seller, such payments
shall be forthwith delivered by such Seller to the Purchaser or Purchasing
Affiliate; and (ii) payment or satisfaction of any Liability is required, such
Seller shall, at the request of the Purchaser or Purchasing Affiliate, pay or
satisfy such Liability subject to such Seller's contemporaneous receipt from the
Purchaser or Purchasing Affiliate of reimbursement therefor and any costs or
expenses related thereto.

                  (c) Except as specifically set forth herein, neither Purchaser
nor the Purchasing Affiliates is receiving or assuming any Contract (or portion
thereof) pursuant to which any business or operations of the Sellers, other than
the Business, have acquired or are acquiring assets, or provide or receive
services, income or other benefits. Promptly following the execution and
delivery of this Agreement, Purchaser and Parent shall cooperate and attempt in
good faith to agree upon a list of Contracts of the Sellers, under which the
respective Seller, prior to the date hereof, received benefits not related to
the Business as well as benefits related to the Business and under which
benefits related to the Business are to be extended to Purchaser and/or the
Purchasing Affiliates after the Closing Date (the "Continuing Contracts").
Purchaser shall use commercially reasonable efforts to enter into a separate
agreement, contract or arrangement with the provider or an alternative provider
of such services or assets, for the provision of such services or assets
provided under the Continuing Contracts directly to Purchaser or a Purchasing
Affiliate. Until such time as a new contract, agreement or arrangement is
obtained from the

                                       38
<PAGE>
provider or an alternative provider of such services or assets, following the
Closing Date Purchaser, or Purchaser shall cause the appropriate Purchasing
Affiliate, to make cash payments to the respective Seller party to the
Continuing Contract, and not directly to the supplier, for its pro rata share of
such services or assets, so that the respective Seller can process the payment
in a timely manner. Such Seller shall apply the payment so received from the
Purchaser or Purchasing Affiliate to the timely payment of amounts due to the
provider under the Continuing Contract for the services or assets so provided
for the benefit of the Purchaser or Purchasing Affiliate.

            6.2 No Solicitation By the Sellers.

                  (a) From the date hereof through the Closing or the earlier
termination of this Agreement, each of the Sellers shall not, and shall cause
each of their respective Representatives (including without limitation
investment bankers, attorneys and accountants) not to, directly or indirectly,
enter into, solicit, initiate or continue any discussions, negotiations or
contacts whatsoever with, or encourage or respond to any inquiries or proposals
by, or participate in any negotiations with, or provide any information to, or
otherwise cooperate in any other way with, any Person, other than the Purchaser
and its Representatives, concerning any sale of all or a portion of the
Purchased Assets or the Business, or of any equity shares of the Sellers, or any
merger, consolidation, liquidation, dissolution or similar transaction involving
any or all of the Sellers (each such transaction being referred to herein as a
"Seller Acquisition Proposal").

                  (b) The Sellers will immediately notify the Purchaser if any
discussions or negotiations are sought to be initiated, any inquiry, contact or
proposal is made, or any information is requested with respect to any Seller
Acquisition Proposal and notify the Purchaser of the terms of any proposal which
a Seller may receive in respect to any such Seller Acquisition Proposal,
including without limitation, the identity of the prospective purchaser or
soliciting party.

            6.3 No Solicitation By the Purchaser.

                  (a) From the date hereof through the Closing or the earlier
termination of this Agreement, the Purchaser shall not, and shall cause each of
its Representatives (including without limitation investment bankers, attorneys
and accountants) not to, directly or indirectly, enter into, solicit, initiate
or continue any discussions or negotiations with, or encourage or respond to any
inquiries or proposals by, or participate in any negotiations with, or provide
any information to, or otherwise cooperate in any other way with any Person
concerning a transaction which would prevent the consummation of the
transactions contemplated by this Agreement (a "Competing Transaction").

                  (b) The Purchaser will immediately notify the Parent if any
discussions or negotiations are sought to be initiated, any inquiry or proposal
is made, or any information is requested with respect to any Competing
Transaction and notify the

                                       39
<PAGE>
Parent of the terms of any proposal which the Purchaser may receive in respect
to any such Competing Transaction, including without limitation, the identity of
the soliciting party.

            6.4 Notification of Certain Matters. From the date hereof through
the Closing, the Sellers shall give prompt notice to the Purchaser and the
Purchaser shall give prompt notice to the Parent, of (a) the occurrence, or
failure to occur, of any event which occurrence or failure would be likely to
cause any representation or warranty contained in this Agreement or in any
exhibit or schedule hereto to be untrue or inaccurate in any material respect
and (b) any material failure of the Sellers or any material failure of the
Purchaser, as the case may be, or any of their respective Affiliates, to comply
with or satisfy any covenant, condition or agreement to be complied with or
satisfied by it under this Agreement or any exhibit or schedule hereto;
provided, however, that such disclosure shall not be deemed to cure any breach
of a representation, warranty, covenant or agreement or to satisfy any
condition. The Sellers shall promptly notify the Purchaser of any Default, the
threat or commencement of any Action, or any development that occurs before the
Closing that has had or may have a Material Adverse Effect.

            6.5 Investigation by the Purchaser.

            Subject to the Confidentiality Agreement, from the date hereof
through the Closing Date:

                  (a) The Sellers shall, and shall cause their Representatives
to, afford the Representatives of the Purchaser and its Affiliates complete
access at all reasonable times to the Purchased Assets and the Business for the
purpose of inspecting the same, and to the officers, key employees, agents,
attorneys, accountants, properties, books and records related to the Business
and Contracts of the Sellers, and shall furnish the Purchaser and its
Representatives all financial, operating and other data and information as the
Purchaser or its Affiliates, through their respective Representatives, may
reasonably request.

                  (b) The Purchaser shall have the right, at its sole cost and
expense to (i) conduct tests of the soil surface or subsurface waters and air
quality at, in, on, beneath or about the Owned Real Property and the Leased Real
Property, and such other procedures as may be recommended by an independent
environmental consultant selected by the Purchaser (the "Consultant") based on
its reasonable professional judgment, in a manner consistent with good
engineering practice, (ii) inspect records, reports, permits, applications,
monitoring results, studies, correspondence, data and any other information or
documents relevant to environmental conditions or environmental noncompliance,
and (iii) inspect all buildings and equipment at the Owned Real Property and the
Leased Real Property, including without limitation the visual inspection of the
Facilities for asbestos-containing construction materials (collectively, the
"Environmental Review"); provided, however, in each case, such Environmental
Review shall be conducted only during regular business hours and in a manner
which will not unduly interfere with the operation of the Business or the use
of, access to or egress from the Owned Real Property and the Leased Property.

                                       40
<PAGE>
            6.6 Maintenance of Business. From the date hereof through the
Closing Date, the Sellers shall cause the Business to be carried on in the
Ordinary Course and in the manner heretofore conducted and shall use their best
efforts to maintain the relationships between the Sellers and their suppliers,
customers and others having business relations with them. Without limiting the
generality of the foregoing, the Sellers shall (a) maintain the Purchased Assets
in their current state of repair, subject to normal wear and tear; (b) maintain
insurance covering the Purchased Assets comparable to that in effect as of the
date hereof; (c) not purchase or commit to purchase any assets or incur (by
guarantee, endorsement or otherwise) any Liabilities or discharge or satisfy any
Liabilities other than in the Ordinary Course of Business which will be Assumed
Liabilities, without the consent of the Purchaser; (d) make timely payments on
accounts payable and other obligations of the Sellers in accordance with past
practice; (e) maintain their existence in good standing; (f) maintain proper
business and accounting records, consistent with past practice; (g) refrain
from, without the Purchaser's prior written consent, increasing the salary or
other benefits of any kind of any employee of Sellers engaged in the Business;
and (h) maintain and defend all rights to any Patents, Trademarks or other
Proprietary Rights relating to the Business. Sellers shall promptly notify the
Purchaser of any significant adverse developments in the Business, including
with respect to the Sellers' market position, sales and profit trends, labor
relations, litigation or insurance claims or other material events.

            6.7 Certain Prohibited Transactions. Without the prior written
consent of the Purchaser, the Sellers (a) will not engage in any transaction or
act (i) which would have a Material Adverse Effect, or (ii) which would
constitute a change or event specified in Section 4.5 which would be required to
be disclosed in the Disclosure Schedule if entered into prior to the date
hereof, and (b) will not enter into a settlement of, or relinquish any rights
with respect to any actual or potential Patent or intellectual property
infringement claim relating to the Business.

            6.8 Employees.

                  (a) The Sellers shall use their best efforts to keep available
to the Purchaser the services of the Business Employees and to use their best
efforts to encourage each Business Employee to accept Purchaser's offers of
employment.

                  (b) The Purchaser (either directly or through one or more
Purchasing Affiliates) shall extend offers of employment to all of the Business
Employees (such employees who accept such offers are hereinafter referred to as
the "Transferred Employees"), which offers shall be at such Transferred
Employee's geographic location and salary or wage and benefits as of the date
hereof (except as otherwise agreed between such Transferred Employee and the
Purchaser), shall include the same or better coverage set forth under the
Assumed Employee Plans, and shall otherwise be on terms and conditions that the
Purchaser will determine in its sole discretion; provided, however, that the
terms offered to the Key Employees shall include the terms set forth on Exhibit
3 hereto. The Sellers shall cooperate with and use their best efforts to assist
the Purchaser in its efforts to secure satisfactory employment arrangements with
the Transferred Employees.

                                       41
<PAGE>
                  (c) Neither the Purchaser nor the Purchasing Affiliates shall
assume any Liabilities under the Seller Retained Employee Plans and the Sellers
shall be solely responsible for all Liabilities with respect to the Seller
Retained Employee Plans, and all obligations and Liabilities thereunder,
including, without limitation, any Tax-related filings with respect to the
Seller Retained Employee Plans. Except as set forth in Section 6.8(d) below,
neither the Purchaser nor the Purchasing Affiliates shall assume any Liabilities
under the Assumed Employee Plans or with respect to the Transferred Employees,
including, but not limited to, cash compensation, to the extent that they
accrue, arise out of, or relate to events or occurrences happening prior to the
Closing Date.

                  (d) With respect to the Transferred Employees, the Purchaser
and its respective Purchasing Affiliates shall recognize all accrued but unused
vacation, floating holidays, sick days and severance obligations and other
employment related obligations as of the Closing Date to the extent such
vacation, floating holidays, sick days and severance obligations were recognized
under the Assumed Employee Plans; provided that such Liabilities for vacation,
floating holidays, sick days and severance obligations shall have been reflected
in the Ordinary Course of Business in the Interim Balance Sheet.

                  (e) No provision of this Agreement shall create any third
party beneficiary rights in any Transferred Employee, any beneficiary or
dependents thereof, or any collective bargaining representative thereof, with
respect to the compensation, terms and conditions of employment and benefits
that may be provided to any Transferred Employee by the Purchaser or its
Affiliates or under any benefit plan which the Purchaser or its Affiliates may
maintain.

            6.9 Division of Businesses. The Parent agrees that the Sellers shall
remove all Excluded Assets from and vacate the Facilities, except for Facilities
specified on Exhibit 15 which are used primarily in businesses of the Sellers
other than the Business, on or prior to the expiration of the period of 60 days
immediately following the Closing; provided that the Sellers hereby agree that
if all Excluded Assets have not been removed from and the Sellers shall not have
vacated such Facilities by such date, the Sellers shall be obligated to pay, and
shall pay, their proportionate share of rent and operating expenses based on the
space utilized by the Sellers in the Facility or Facilities in which Excluded
Assets remain; provided, however, that the Sellers shall in any event remove all
Excluded Assets from the Facilities by not later than the expiration of the
period of 120 days immediately following the Closing. The Sellers may vacate the
Facilities at any earlier date. During the period of the Sellers' occupancy, the
Sellers may conduct their normal business operations at the Facilities, but
shall do so only in a manner that does not interfere with the conduct of
business by the Purchaser at the Facilities.

            6.10 Integration of the Business with the Purchaser; Transition
Services. The Sellers agree to participate to the extent reasonably requested by
the Purchaser in the integration of the Business with the business of the
Purchaser and to ensure a smooth transition of the Business to the Purchaser and
the Purchasing Affiliates, including provision of services to the

                                       42
<PAGE>
Purchaser or Purchasing Affiliates for a period of one year following the
Closing in accordance with the terms of the Transition Services Agreement.

            6.11 Vendor Relations. Prior to, and for a period of three (3) years
after, Closing, no Seller shall intentionally cause any vendor, representative
or distributor as of the Closing to discontinue being the vendor to, or
representative or distributor for, the Purchaser or any of its Affiliates.

            6.12 Tax Matters.

                  (a) The Sellers shall file, to the extent required by, or
permissible under, applicable Tax Law, all necessary Tax Returns and other
documentation with respect to all transfer and sales taxes, and, if required by
applicable Tax Law, the Purchaser (or its affiliate) shall join in the execution
of any Tax Returns and other documentation.

                  (b) Real property or personal property taxes and other similar
Taxes imposed on Purchased Assets (excluding such Taxes relating to Sunsoft and
Sunsoft UK, which shall be governed by Section 6.12(d)(ii) hereof) for taxable
periods that begin before the Closing Date and end after the Closing Date (a
"Straddle Period") shall be allocated between the Sellers and the Purchaser
based on the number of days before and after the Closing Date. The Purchaser
shall prepare and timely file all Tax Returns with respect to such Taxes
described in the preceding sentence required to be filed after the Closing Date,
if any, and shall duly and timely pay all such Taxes shown to be due on such Tax
Returns. The Purchaser shall make such Tax Returns available for the Parent's
review and approval (which approval shall not be unreasonably withheld) no later
than fifteen (15) business days prior to the due date for filing each such Tax
Return. Within fifteen (15) business days after receipt of a Tax Return referred
to in this Section 6.12(b), the Parent shall pay to the Purchaser the Sellers'
share of the amount shown on such Tax Return, less payments on account of such
Taxes previously made by the Sellers.

                  (c) The Purchaser and the Sellers shall provide the other with
such assistance as may reasonably be requested by the other Party in connection
with the preparation of any Tax Return relating to the Business, any audit or
other examination by any taxing authority, or any judicial or administrative
proceedings relating to Liability for Taxes relating to the Business, and each
shall retain and provide the requesting party with any records or information
which may be relevant to such return, audit, examination or proceedings relating
to the Business.

                  (d) The following provisions shall govern the allocation of
responsibility as between the Purchaser and the Sellers for Tax matters relating
to Sunsoft and Sunsoft UK in connection with this Agreement or following the
Closing Date:

                        (i) [Reserved]

                        (ii) The Purchaser shall prepare or cause to be
prepared, file or cause to be filed and pay all Taxes due in respect of all Tax
Returns required to be filed by

                                       43
<PAGE>
Sunsoft and Sunsoft UK for Straddle Periods or for periods ending on or prior to
the Closing Date (if not filed by the Closing Date). Taxes for Straddle periods
shall be allocated between the Sellers and the Purchaser, in the case of
personal property tax, real property tax and similar taxes, based on the number
of days before and after the Closing Date, and in the case of other Taxes, based
on a hypothetical closing of the books. The Purchaser shall make such Tax
Returns available for the Parent's review and approval (which approval shall not
be unreasonably withheld) no later than fifteen (15) business days prior to the
due date for filing each such Tax Return. Within fifteen (15) business days
after receipt of such Tax Return, the Parent (on behalf of the Sellers) shall
pay to the Purchaser the Sellers' share of the amount shown on such Tax Return,
less payments on account of such Taxes previously made by the Sellers. In the
case such Tax Return relates to a period ending on or prior to the Closing Date
but is filed after the Closing Date, the Sellers' share shall be the entire
amount shown on such Tax Return.

                        (iii) Parent US Sub shall be responsible for the filing
of consolidated, unitary or combined income Tax Returns of Parent US Sub's group
that includes the operations and income of Sunsoft until the Closing Date and
the payment of Taxes shown on such Tax Returns.

                        (iv) From and after the Closing Date, the Sellers shall
indemnify, defend and hold the Purchaser, Sunsoft, Sunsoft UK and their
Affiliates harmless from and against any and all Taxes which may be suffered or
incurred by the Purchaser, Sunsoft, Sunsoft UK and their Affiliates in respect
of (i) Taxes attributable to Sunsoft or Sunsoft UK with respect to any periods
ending on or prior to the Closing Date and any pre-Closing period (including a
pre-Closing portion of any Straddle Period) and (ii) Taxes payable by Sunsoft or
Sunsoft UK with respect to any taxable period (or a portion thereof) ending on
or prior to the Closing Date by application of Treasury Regulations Section
1.1502-6 or of any analogous foreign, state or local Tax. In the case of any
audit, examination or other proceeding ("Proceeding") with respect to Taxes for
which the Sellers are or may be obligated to indemnify pursuant to this Section
6.12(d)(iv), the Purchaser shall allow the Sellers, at the Sellers' expense, to
control the conduct of the Proceeding. The Sellers shall have the right to
control such Proceeding, but shall not settle or otherwise resolve any such
Proceeding concerning Taxes without the prior written consent of the Purchaser,
which consent shall not be unreasonably withheld; provided, however, that if
such Proceeding involves any Tax issues the resolution of which may impact any
position relating to Taxes of Sunsoft or Sunsoft UK after the Closing Date, the
Purchaser shall have the right to withhold its consent in its sole discretion.
The Purchaser shall (i) promptly notify the Sellers upon receipt of any notice
relating to any such Proceeding as to any Taxes in respect of which the Sellers
have agreed to indemnify pursuant to this Section 6.12(d)(iv)and (ii) have the
right to participate in the process at its own expense. In the event the Sellers
do not exercise its right to control such Proceeding, the Purchaser shall have
the right to control the process at the Sellers' expense. All tax sharing
agreements or similar agreements with respect to or involving Sunsoft or Sunsoft
UK shall be terminated on or before the Closing Date.

            6.13 Photochromic Technology. Parent is currently engaged in
negotiations of a partnership agreement with Transitions Optical Inc. regarding
photochromic technology for hydrophilic contact lenses (the "Photochromic
Agreement"). Parent agrees that the

                                       44
<PAGE>
Photochromic Agreement shall provide the right of the Parent to assign the
Photochromic Agreement to Purchaser and its Purchasing Affiliates. The Parent
further agrees that (i) as soon as practicable following the execution of the
Photochromic Agreement, the Parent shall deliver a copy of the executed
Photochromic Agreement to the Purchaser and (ii) the Purchaser or a Purchasing
Affiliate shall have the option to acquire from the Parent the rights and assume
the Parent's obligations under the Photochromic Agreement at no additional cost
to the Purchaser or Purchasing Affiliate by delivering to the Parent a written
notice within thirty (30) days after delivery of the copy of the Photochromic
Agreement to the Purchaser of the Purchaser's or Purchasing Affiliate's election
to have the Photochromic Agreement assigned to such party. If the Purchaser or
Purchasing Affiliate makes such an election to have the Photochromic Agreement
assigned to such party, as soon as reasonably practicable following delivery of
such notice to the Parent, the parties shall execute and deliver such documents
as are reasonably necessary to cause such agreement to be assigned to the
Purchaser or Purchasing Affiliate and assumed by the Purchaser or Purchasing
Affiliate.

            6.14 Parent Board of Director Approval. Immediately following the
execution of this Agreement, the Parent shall duly call and convene and hold a
meeting of its board of directors (such meeting in any event to occur on or
before January 31, 2001) for the purpose of obtaining the due approval of
Parent's board of directors of this Agreement (with the terms, conditions and
content contained herein as of the date hereof) and the Ancillary Agreements and
the transactions contemplated hereby and thereby (the "Parent Board Approval").

            6.15 HOC Contact Lens Business. The Parent covenants that (i) sales
with respect to the HOC Contact Lens Business shall be limited to customers
located in The Netherlands and the volume of the future sales, on an annualized
basis, of the HOC Contact Lens Business will be equal to or less than the volume
of sales of the HOC Contact Lens Business in 2000, and (ii) within eighteen (18)
months following the Closing, the Parent shall cause the HOC Contact Lens
Business to be terminated.

                                  ARTICLE VII.
              CONDITIONS PRECEDENT TO OBLIGATIONS OF THE PURCHASER

            7.1 Conditions. The obligations of the Purchaser to consummate the
transactions provided for hereby are subject, in the discretion of the
Purchaser, to the satisfaction, on or prior to the Closing Date, of each of the
following conditions, any of which may be waived by the Purchaser:

                  (a) the representations and warranties in Article IV shall be
true and correct when made and at and as of the Closing Date as if such
representations and warranties were made at such time (except that those
representations and warranties which are made as of a specific date shall be
true and correct only as of such date);

                  (b) the Sellers shall have performed and satisfied in all
material respects all agreements and covenants required hereby to be performed
or satisfied by them prior to or at the Closing Date;

                                       45
<PAGE>
                  (c) all Consents from any Person, and all filings,
registrations and notifications necessary to permit the consummation of the
transactions contemplated by this Agreement and the Ancillary Agreements shall
have been obtained or made and the waiting period under the HSR Act shall have
expired or been terminated;

                  (d) no Court Order, Action or proceeding shall have been
instituted or threatened which makes the transactions contemplated by this
Agreement or the Ancillary Agreements illegal or otherwise prohibited;

                  (e) no Person who or which is not a party to this Agreement or
the Ancillary Agreements shall have commenced or threatened to commence any
Action seeking to restrain or prohibit, or to obtain damages in connection with,
the transactions contemplated by this Agreement or the Ancillary Agreements;

                  (f) there shall not have occurred any event, change or
condition that, individually or in the aggregate, has had or could reasonably be
expected to have a Material Adverse Effect;

                  (g) the Purchaser and its Representatives shall have completed
the Environmental Review, and in the sole discretion of the Purchaser, the
Purchaser shall be satisfied with the results of the Environmental Review. The
Environmental Review shall have no effect whatsoever on the liability of the
Sellers to the Purchaser under this Agreement or otherwise for breach of any
representations, warranties or covenants of the Sellers hereunder;

                  (h) the Purchaser shall have obtained or been granted the
right to use all Permits necessary for the operation of the Business;

                  (i) the Sellers shall have delivered the documents required to
be delivered by them pursuant to Section 3.2, and the Ancillary Agreements shall
be in full force and effect;

                  (j) each of the employees of the Sellers identified on Exhibit
16 (the "Key Employees") shall have entered into an employment agreement with
the Purchaser or Purchasing Affiliate on terms satisfactory to the Purchaser and
the respective Key Employee (the "Executive Employment Agreements");

                  (k) the Sellers shall have delivered to the Purchaser opinions
of counsel licensed in each of the respective jurisdictions of organization of
the Sellers, dated as of the Closing Date, substantially in the form of Exhibit
17 hereto;

                  (l) the Parent Agreements designated by the Purchaser shall
have been terminated and the parties thereto shall have been released from all
obligations thereunder and the Sellers shall have delivered to the Purchaser
evidence satisfactory to the Purchaser of such termination and release;

                                       46
<PAGE>
                  (m) the Patent and Know-How License Agreement shall have been
amended in a manner satisfactory to the Purchaser and Parent;

                  (n) the Sellers shall have delivered to the Purchaser such
certificates of their officers to evidence compliance with the conditions set
forth in this Article VII as may be reasonably be requested by the Purchaser;

                  (o) the Purchaser shall have received from the Sellers
resolutions adopted by the directors of the Sellers, or other evidence
satisfactory to the Purchaser, evidencing the approval of this Agreement and the
Ancillary Agreements and the transactions contemplated hereby and thereby,
certified by the authorized representatives of the Sellers;

                  (p) Parent US Sub shall have delivered to the Purchaser a
non-foreign affidavit pursuant to Section 1445(b)(2) of the Code; and

                  (q) the Parent shall have obtained the Parent Board Approval.

                                  ARTICLE VIII.
                 CONDITIONS PRECEDENT TO OBLIGATIONS OF SELLERS

            8.1 Conditions. The obligations of the Sellers to consummate the
transactions provided for hereby are subject, in the discretion of the Parent,
to the satisfaction, on or prior to the Closing Date, of each of the following
conditions, any of which may be waived by the Parent:

                  (a) the representations and warranties in Article V shall be
true and correct when made and at and as of the Closing Date as if such
representations and warranties were made at such time (except that those
representations and warranties which are made as of a specific date shall be
true and correct only as of such date);

                  (b) the Purchaser shall have performed and satisfied in all
material respects all agreements and covenants required hereby to be performed
or satisfied by it prior to or at the Closing Date;

                  (c) all Consents from governmental authorities, and all
filings, registrations and notifications with or of governmental authorities
necessary to permit the consummation of the transactions contemplated by this
Agreement and the Ancillary Agreements shall have been obtained or made and the
waiting period under the HSR Act shall have expired or been terminated;

                  (d) no Court Order, Action or proceeding shall have been
instituted or threatened which makes the transactions contemplated by this
Agreement or the Ancillary Agreements illegal or otherwise prohibited;

                  (e) no Person who or which is not a party to this Agreement or
the Ancillary Agreements shall have commenced or threatened to commence any
Action

                                       47
<PAGE>
seeking to restrain or prohibit, or to obtain damages in connection with the
transactions contemplated by this Agreement or the Ancillary Agreements;

                  (f) the Purchaser or the Purchasing Affiliates, as the case
may be, shall have delivered the documents required to be delivered by it or
them pursuant to Section 3.2, and the Ancillary Agreements shall be in full
force and effect;

                  (g) the Purchaser shall have delivered to the Parent opinions
of counsel licensed in each of the respective jurisdictions of organization of
the Purchaser and Purchasing Affiliates, dated as of the Closing Date,
substantially in the form of Exhibit 18 hereto;

                  (h) the Purchaser shall have delivered to the Sellers such
certificates of their officers to evidence compliance with the conditions set
forth in this Article VIII as may be reasonably be requested by the Sellers;

                  (i) the Sellers shall have received from the Purchaser
resolutions adopted by the board of directors of the Purchaser, approving this
Agreement and the Ancillary Agreements and the transactions contemplated hereby
and thereby, certified by the Purchaser's corporate secretary; and

                  (j) the Parent shall have obtained the Parent Board Approval.

                                   ARTICLE IX.
                                 INDEMNIFICATION

            9.1 Survival of Representations, Etc. The representations and
warranties of the Parent and the Purchaser contained herein shall survive the
Closing Date until the later of (a) the first anniversary of the Closing Date,
or (b) the forty-fifth (45th) day following the date of completion by the
Purchaser's auditors of the audit of the financial statements for the Business
acquired by the Purchaser hereunder for the year ended December 31, 2001 (and
claims based upon or arising out of such representations and warranties may be
asserted at any time before such date); provided, however, (i) the Parent's
representations and warranties set forth in Section 4.3 ("Authorization") shall
survive for a period of five (5) years and (ii) the Parent's representations and
warranties in Sections 4.20 ("Employee Plans and Employee Matters"), 4.22 ("Tax
Matters"), 4.26 ("Compliance with Environmental Laws"), 4.16 ("Warranty and
Product Liability Matters") and 4.27 ("Ownership of Sunsoft Shares and Sunsoft
UK Shares") shall survive for a period equal to the relevant statute of
limitations (including, in the case of Taxes, any extensions thereof). The right
to indemnification or other remedy based on the representations and warranties
herein will not be affected by any investigation conducted with respect to, or
any knowledge acquired (or capable of being acquired) at any time, whether
before or after the execution and delivery of this Agreement or the Closing,
with respect to the accuracy or inaccuracy of any such representation or
warranty.

            9.2 Indemnification.

                                       48
<PAGE>
                  (a) The Parent shall indemnify the Purchaser and its
Affiliates, and each of its officers, directors, employees, shareholders,
partners and agents as the case may be ("Purchaser Indemnified Parties")
against, and hold each Purchaser Indemnified Party harmless from, any damage,
claim, loss, cost, Liability or expense, including without limitation, interest,
penalties, reasonable attorneys' fees and expenses of investigation, damages,
diminution in value, response action, removal action or remedial action
(collectively "Damages") incurred or suffered by such Purchaser Indemnified
Party, that are incident to, arise out of, in connection with, or related to,
whether directly or indirectly: (i) the breach of any warranty or representation
of the Parent or the Companies contained in this Agreement or in any agreement,
certificate or other instrument delivered by the Parent or the Companies
pursuant to this Agreement (including any Ancillary Agreements); (ii) any breach
or non-performance by the Parent or the Companies of any of their respective
covenants or agreements contained in this Agreement or in any agreement,
certificate or other instrument delivered by the Parent or the Companies
pursuant to this Agreement (including any Ancillary Agreements); and (iii) any
Excluded Liability; provided that the term "Damages" is not limited to matters
asserted by third parties against Purchaser Indemnified Parties or Seller
Indemnified Parties (as defined below) (the "Indemnified Party"), but includes
Damages incurred or sustained by an Indemnified Party in the absence of third
party claims. Payments by an Indemnified Party of amounts for which such
Indemnified Party is indemnified hereunder, shall not be a condition precedent
to recovery. Notwithstanding the foregoing, the term "Damages" shall not include
any Adjustments Amounts paid in accordance with Section 2.5 hereof and shall not
include any future lost profits or similar consequential damages.

                  (b) The Purchaser shall indemnify the Sellers, their
Affiliates, and each of their respective partners, officers, directors,
employees, shareholders and agents, as the case may be ("the Seller Indemnified
Parties"), against, and hold each Seller Indemnified Party harmless from, any
Damages incurred by such Seller Indemnified Party incident to, arising out of,
in connection with or related to, whether directly or indirectly, (i) any breach
of any representation or warranty of the Purchaser contained in this Agreement
or in any agreement, certificate or other instrument delivered by the Purchaser
or Purchasing Affiliate pursuant to this Agreement (including any Ancillary
Agreements); (ii) any breach or non-performance by the Purchaser or Purchasing
Affiliate of its or their covenants or agreements contained in this Agreement or
in any agreement, certificate or other instrument delivered by the Purchaser or
Purchasing Affiliate pursuant to this Agreement (including any Ancillary
Agreements); and (iii) any Assumed Liability.

                  (c) Defense of Claims.

                        (i) If a claim for Damages (a "Claim") is to be made by
an Indemnified Party against the indemnifying party (the "Indemnifying Party"),
the Indemnified Party claiming such indemnification shall give written notice (a
"Claim Notice") containing details of the amount and documenting or justifying
such Claim to the Indemnifying Party as soon as practicable after the party
entitled to indemnification becomes aware of any fact,

                                       49
<PAGE>
condition or event which may give rise to Damages for which indemnification may
be sought under this Section 9.2. If any lawsuit or enforcement action is filed
against any party entitled to the benefit of indemnity hereunder, written notice
thereof shall be given to the Indemnifying Party as promptly as practicable. The
failure of any Indemnified Party to give timely notice hereunder shall not
affect rights to indemnification hereunder, except to the extent that the
Indemnifying Party demonstrates actual damage caused by such failure.

                        (ii) After such notice, if the Indemnifying Party shall
acknowledge in writing to the Indemnified Party that the Indemnifying Party
shall be obligated under the terms of its indemnity hereunder in connection with
such lawsuit or action, then the Indemnifying Party shall be entitled, if it so
elects at its own cost, risk and expense, (A) to take control of the defense and
investigation of such lawsuit or action, (B) to employ and engage attorneys of
its own choice to handle and defend the same unless the named parties to such
action or proceeding include both the Indemnifying Party and the Indemnified
Party and the Indemnified Party has been advised in writing by counsel that
there may be one or more legal defenses available to such Indemnified Party that
are different from or additional to those available to the Indemnifying Party,
in which event the Indemnified Party shall be entitled, at the Indemnifying
Party's cost, risk and expense, to separate counsel of its own choosing, and (C)
to compromise or settle such claim, which compromise or settlement shall be made
only with the written consent of the Indemnified Party, such consent not to be
unreasonably withheld.

                        (iii) If the Indemnifying Party fails to assume the
defense of such claim within fifteen (15) calendar days after receipt of the
Claim Notice, the Indemnified Party against which such Claim has been asserted
will, if it shall reasonably determine and demonstrate that its rights would be
adversely affected by a failure to defend, (upon delivering notice to such
effect to the Indemnifying Party) have the right to undertake, at the
Indemnifying Party's cost and expense, the defense, compromise or settlement of
such Claim on behalf of and for the account and risk of the Indemnifying Party;
provided, however, that such Claim shall not be compromised or settled without
the written consent of the Indemnifying Party, which consent shall not be
unreasonably withheld. In the event the Indemnified Party assumes the defense of
the Claim, the Indemnified Party will keep the Indemnifying Party reasonably
informed of the progress of any such defense, compromise or settlement. The
Indemnifying Party shall be liable for any settlement of any action effected
pursuant to and in accordance with this Section 9.2 and for any final judgment
(subject to any right of appeal), and the Indemnifying Party agrees to indemnify
and hold harmless an Indemnified Party from and against any Damages by reason of
such settlement or judgment.

                  (d) Limitations. Except for Damages incurred by a Purchaser
Indemnified Party and indemnified pursuant to Section 9.2(a)(ii) or 9.2(a)(iii),
and for Damages incurred by a Seller Indemnified Party pursuant to Section
9.2(b)(ii) or 9.2(b)(iii), in the absence of fraud or willful misrepresentation,
a Purchaser Indemnifed Party or a Seller Indemnified Party, as the case may be,
shall not be entitled to recover any Damages incurred pursuant to Section
9.2(a)(i) or 9.2(b)(i), as the case may be, until such time as the Damages in
the aggregate claimed by the respective Indemnified Party exceeds U.S.$250,000
(the "Damage Threshold"), at which time such Indemnified Party shall be entitled
to be indemnified against and compensated and reimbursed for all such

                                       50
<PAGE>
Damages, including Damages included in the Damage Threshold. Notwithstanding the
foregoing, the aggregate cumulative Liability of Parent for Damages to Purchaser
Indemnified Parties under this Article IX shall not exceed the Purchase Price
received by Parent and its Affiliates hereunder net of Taxes incurred by Parent
and its Affiliates in connection with consummation of the transactions
contemplated by this Agreement.

                                   ARTICLE X.
                                   TERMINATION

            10.1 Termination. This Agreement and the transactions contemplated
hereby may be terminated or abandoned at any time prior to the Closing Date:

                  (a) by the mutual written agreement of the Purchaser and the
Parent;

                  (b) by either the Purchaser or the Parent if any governmental
entity shall have issued an order, decree or ruling or taken any other action
(which order, decree, ruling or other action the parties shall have used their
reasonable efforts to resist, resolve or lift, as applicable) permanently
restraining, enjoining or otherwise prohibiting the transactions contemplated by
this Agreement, and such order, decree, ruling or other action shall have become
final and nonappealable;

                  (c) by the Purchaser, upon a material breach of any covenant
or agreement on the part of the Sellers set forth in this Agreement, or if (i)
any representation or warranty of the Sellers that is qualified as to
materiality shall have become untrue or (ii) any representation or warranty of
the Sellers that is not so qualified shall have become untrue in any material
respect, (a "Terminating Seller Breach"); provided, however, that, if such
Terminating Seller Breach is capable of being cured by the Sellers prior to the
Closing Date through the exercise of their best efforts, the Purchaser shall
promptly give notice of such Terminating Seller Breach to the Parent and if such
Terminating Seller Breach is cured within 15 days after giving notice to the
Parent of such breach, the Purchaser may not terminate this Agreement under this
Section 10.1(c);

                  (d) by the Parent, upon a material breach of any covenant or
agreement on the part of the Purchaser set forth in this Agreement, or if (i)
any representation or warranty of the Purchaser that is qualified as to
materiality shall have become untrue or (ii) any representation or warranty of
the Purchaser that is not so qualified shall have become untrue in any material
respect ("Terminating Purchaser Breach"); provided, however, that, if such
Terminating Purchaser Breach is capable of being cured by the Purchaser prior to
the Closing Date through the exercise of best efforts, the Parent shall promptly
give notice of such Terminating Purchaser Breach to the Purchaser and if such
Terminating Purchaser Breach is cured within 15 days after giving written notice
to the Purchaser of such breach, the Parent may not terminate this Agreement
under this Section 10.1(d); or

                                       51
<PAGE>
                  (e) by the Purchaser, if the Parent Board Approval has not
been obtained on or before January 31, 2001.

            10.2  Effect of Termination.

                  (a) In the event of termination of this Agreement by either
the Purchaser or the Parent as provided in Section 10.1, this Agreement shall
forthwith become void and there shall be no liability or obligation on the part
of the Purchaser or the Parent or their respective officers or directors except
(i) as provided in this Section 10.2 and Article XI and (ii) with respect to any
Damages incurred or suffered by a party as a result of the willful breach by the
other party of any of its covenants or other agreements set forth in this
Agreement.

                  (b) In the event of termination of this Agreement by the
Purchaser pursuant to Section 10.1(c) or 10.1(e), then the Parent shall pay the
Purchaser a cash fee of U.S.$1,500,000 as reimbursement for all expenses
incurred in connection with this Agreement and the transactions contemplated
hereby, which amount shall be payable by wire transfer of same day funds within
three business days after such termination therefor.

                  (c) In the event of termination of this Agreement by the
Parent pursuant to Section 10.1(d), then the Purchaser shall pay the Parent a
cash fee of U.S.$1,000,000 as reimbursement for all expenses incurred in
connection with this Agreement and the transactions contemplated hereby, which
amount shall be payable by wire transfer of same day funds within three business
days after such termination therefor.

                  (d) If, during the 180 day period commencing on the day
following the date on which this Agreement is terminated pursuant to Section
10.1(c), any of the Sellers shall enter into an agreement with respect to a
Seller Acquisition Proposal with any third party, upon consummation of the
transaction contemplated by such Seller Acquisition Proposal (whether or not
such consummation shall occur within such 180 day period), the Parent shall pay
to the Purchaser a cash fee of U.S.$5,000,000 less the amount, if any,
theretofore paid by the Parent pursuant to Section 10.2(b), in immediately
available funds, promptly, but in no event later than two business days, after
the date of such consummation.

                  (e) If, during the 180 day period commencing on the day
following the date on which this Agreement is terminated pursuant to Section
10.1(d), the Purchaser shall enter into an agreement with respect to a Competing
Transaction with any third party with whom the Purchaser had any discussions
concerning a Competing Transaction prior to the 180th day following the date on
which this Agreement is terminated, upon consummation of the transaction
contemplated by such Competing Transaction (whether or not such consummation
shall occur with such 180 day period), the Purchaser shall pay to the Parent a
cash fee of U.S.$5,000,000 less the amount, if any, theretofore paid by the
Purchaser pursuant to Section 10.2(c), in immediately available

                                       52
<PAGE>
funds, promptly, but in no event later than two business days, after the date of
such consummation; provided, however, that for purposes of this Section 10.2(e),
the term "Competing Transaction" shall only be deemed to include transactions
with a third party in which the aggregate consideration paid or to be paid by
the Purchaser and its Affiliates to such third party is equal to or greater than
U.S.$50,000,000.

                  (f) If this Agreement is terminated pursuant to Section
10.1(e) and at any time prior to the 365th day following the date on which this
Agreement is terminated pursuant to Section 10.1(e), any of the Sellers shall
enter into an agreement with respect to a Seller Acquisition Proposal with any
third party, upon consummation of the transaction contemplated by such Seller
Acquisition Proposal (whether or not such consummation shall occur within such
365 day period), the Parent shall pay to the Purchaser a cash fee of
U.S.$15,000,000 less the amount, if any, theretofore paid by the Parent pursuant
to Section 10.2(b), in immediately available funds, promptly, but in no event
later than two business days, after the date of such consummation.

                                   ARTICLE XI.
                                  MISCELLANEOUS

            11.1 Assignment. Neither this Agreement nor any of the rights or
obligations hereunder may be assigned by the Sellers without the prior written
consent of the Purchaser, or by the Purchaser without the prior written consent
of the Parent, except that the Purchaser may, without such consent, assign its
rights hereunder either before or after the Closing Date to one or more
Affiliates of the Purchaser or after the Closing Date to any third party,
provided, however, that no such assignment shall release the Purchaser from any
of its obligations under this Agreement. Subject to the foregoing, this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective permitted successors and assigns, and no other Person shall
have any right, benefit or obligation hereunder. At or following the Closing,
the Purchaser (or its assignees) may assign this Agreement to any lender to the
Purchaser (or assignee) as security for its obligations to such lender.

            11.2 Notices. Unless otherwise provided herein, any notice, request,
instruction or other document to be given hereunder by any party to the other
shall be in writing and delivered in person or by courier, telegraphed, telexed
or by facsimile transmission or mailed by registered or certified mail, postage
prepaid, return receipt requested (such mailed notice to be effective on the
date of such receipt is acknowledged), as follows:

            If to the Purchaser:

            Ocular Sciences, Inc.
            475 Eccles Avenue
            South San Francisco, CA 94080
            Attention:  John Fruth, Chief Executive Officer
            Fax:  (650) 583-9017

                                       53
<PAGE>
            With a copy to:

            Latham & Watkins
            505 Montgomery Street, Suite 1900
            San Francisco, California 94111
            Attention:  Jeffrey T. Pero, Esq.
            Fax:  (415) 395-8095

            If to the Sellers:

            Essilor International (Compagnie Generale d'Optique) S.A
            147, rue de Paris
            94227 Charenton-Le-Pont
            France
            Attention:  Carol Xueref, Director of Legal Affairs
            and Group Development
            Fax:  33-(1) 49-77-43-05

            Any party may, from time to time, designate any other address to
which any such notice to it or such party shall be sent. Any such notice shall
be deemed to have been delivered upon receipt.

            11.3 Choice of Law. This Agreement shall be construed, interpreted
and the rights of the parties determined in accordance with the Laws of France,
without reference to the conflicts of Laws of such jurisdiction that may
otherwise require the application of the Laws of another jurisdiction.

            11.4 Arbitration of Disputes. Except for disputes regarding the
Adjustment Amount as provided in Section 2.5 hereof, any dispute, difference or
question that may, at any time, arise between the parties hereto or any of them
concerning this Agreement or the Ancillary Agreements or the construction,
meaning, operation or effect thereof or of any clause herein or in the Ancillary
Agreements, or concerning the rights, duties and Liabilities of the parties
respectively under, or otherwise by virtue of this Agreement and the Ancillary
Agreements shall be referred to arbitration in accordance with the Rules of
Conciliation and Arbitration of the International Chamber of Commerce, and the
venue of such arbitration shall be Reykjavik, Iceland. The award of such
arbitration shall be final and binding on the parties hereto and any party may
apply to a court of competent jurisdiction for a ruling or other order to effect
the terms of the arbitration.

            11.5 Entire Agreement; Amendments and Waivers; Interpretation. This
Agreement, the Ancillary Agreements and all exhibits and schedules hereto and
thereto, and the Confidentiality Agreement, constitute the entire agreement
among the parties pertaining to the subject matter hereof and supersedes all
prior agreements, understandings, negotiations and discussions, whether oral or
written, of the parties; provided, however, that no representation or warranty
set forth in any Transfer Documents shall modify or limit in any manner the

                                       54
<PAGE>
representations and warranties set forth in this Agreement. No supplement,
modification or waiver of this Agreement shall be binding unless executed in
writing by the party to be bound thereby. No waiver of any of the provisions of
this Agreement shall be deemed or shall constitute a waiver of any other
provision hereof (whether or not similar), nor shall such waiver constitute a
continuing waiver unless otherwise expressly provided. 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
presumption or burden or proof shall arise favoring or disfavoring any party by
virtue of the authorship of any of the provisions of this Agreement.

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

            11.7 Invalidity. In the event that any one or more of the provisions
contained in this Agreement or in any other instrument referred to herein,
shall, for any reason, be held to be invalid, illegal or unenforceable in any
respect, such invalidity, illegality or unenforceability shall not affect any
other provision of this Agreement or any other such instrument.

            11.8 Covenants of Subsidiaries. Each covenant herein made by the
Sellers shall be deemed to be a covenant of the Parent by and on behalf of
itself and by and on behalf of each of the Companies, and in each case, Parent
shall cause each of the respective Companies to comply with the covenant and
each covenant herein made by the Subsidiaries of the Purchaser shall be deemed
to be a covenant of the Purchaser by and on behalf of itself and by and on
behalf of each of such Subsidiary, and in each case, Purchaser shall cause each
of its respective Subsidiaries to comply with the covenant.

            11.9 Headings. The headings of the Articles and Sections herein are
inserted for convenience of reference only and are not intended to be a part of
or to affect the meaning or interpretation of this Agreement.

            11.10 Expenses. Except as otherwise specifically provided in this
Agreement, each party will pay its own expenses incident to this Agreement and
the transactions contemplated hereby, including legal and accounting fees and
disbursements.

            11.11 Schedules. The Schedules and Exhibits referenced in this
Agreement are a material part hereof and shall be treated as if fully
incorporated into the body of the Agreement.

            11.12 Public Statements and Press Releases. The parties hereto
covenant and agree that, except as provided for hereinbelow, each will not from
and after the date hereof make, issue or release any public announcement, press
release, statement or acknowledgment of the existence of, or reveal publicly the
terms, conditions and status of, the transactions provided for herein, without
the prior written consent of the other party as to the content and time of
release of and the media in which such statement or announcement is to be made;
provided, however, that in the case of announcements, statements,
acknowledgments or revelations which either party is required by Law to make,
issue or release, the making, issuing or releasing of any

                                       55
<PAGE>
such announcement, statement, acknowledgment or revelation by the party so
required to do so by Law shall not constitute a breach of this Agreement if such
party shall have given, to the extent reasonably possible, not less than two (2)
calendar days prior notice to the other party, and shall have attempted, to the
extent reasonably possible, to clear such announcement, statement,
acknowledgment or revelation with the other party. Each party hereto agrees that
it will not unreasonably withhold any such consent or clearance.

            11.13 No Third-Party Beneficiaries. This Agreement is for the sole
benefit of the parties hereto (and their permitted successors and assigns) and
nothing herein expressed or implied shall give, or be construed to give, to any
Person, other than the parties hereto and such permitted successors and assigns,
any legal or equitable rights hereunder.

            11.14 Further Assurances.

                  (a) Upon the terms and subject to the conditions contained
herein, after the Closing the parties agree (i) to use all reasonable efforts to
take, or cause to be taken, all actions and to do, or cause to be done, all
things necessary, proper or advisable to consummate and make effective the
transactions contemplated by this Agreement and the Ancillary Agreements; (ii)
to execute any documents, instruments or conveyances of any kind which may be
reasonably necessary or advisable to carry out any of the transactions
contemplated hereunder and thereunder; and (iii) to cooperate with each other in
connection with the foregoing.

                  (b) After the Closing, each party agrees that it will
cooperate with and make available to the other party, during normal business
hours, all books and records, information and employees (without substantial
disruption of employment) retained and remaining in existence after the Closing
which are necessary or useful in connection with any financial statement audit,
tax inquiry, audit, investigation or dispute, any litigation or investigation or
any other matter requiring any such books and records, information or employees
for any reasonable business purpose and will take reasonable measures to cause
it Representatives, including its accountants, to do the same.

                                       56
<PAGE>
            IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed on their respective behalf all as of the day and year first
above written.

OCULAR SCIENCES, INC.,
a Delaware corporation

/s/ John Fruth
___________________________
By: John Fruth
Title: CEO & President

Essilor International (Compagnie Generale d'Optique) S.A,
a French corporation

/s/ Philippe Alfroid
___________________________
By: Philippe Alfroid
Title: Chief Operating Officer

                  SIGNATURE PAGE TO ASSET PURCHASE AGREEMENT<PAGE>
                                                                    EXHIBIT 10.3

                                MASTER AGREEMENT
<PAGE>
                                       -i-

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                             PAGE
                                                                             ----
<S>                                                                          <C>
ARTICLE 1  DEFINITIONS ...................................................     2

      1.1   Definitions. .................................................     2

ARTICLE 2  AGREEMENTS ....................................................     2

      2.1   Purchase and Sale of Assets. .................................     2
      2.2   Employees. ...................................................     5
      2.3   Purchased IT Assets and Leases and Licenses. .................     6
      2.4   Distribution Service. ........................................     7
      2.5   Agreements with Other Entities. ..............................     7
      2.6   License. .....................................................     8
      2.7   Cooperation. .................................................     8
      2.8   Supply of Conventional Lenses. ...............................     9
      2.9   Accounts Receivable. .........................................     9
      2.10  Trademarks Proprietary to SC. ................................    10
      2.11  Option to Purchase Intellectual Property Proprietary to SE
            and/or SECL. .................................................    10
      2.12  Clinical and Analytical Evaluation Services and Use of
            Clinical and Analytical Instruments of SE; Option to Purchase.    11
      2.13  After-Sales Service. .........................................    11
      2.14  [Intentionally Omitted] ......................................    11
      2.15  Liabilities and Obligations. .................................    12
      2.16  Non Competition. .............................................    12
      2.17  Right of First Refusal. ......................................    12

ARTICLE 3  CONSIDERATION .................................................    13

      3.1   Consideration. ...............................................    13
      3.2   Consideration and Determination of Closing Assets. ...........    14
      3.3   Stamp Duty. ..................................................    15
      3.4   Consumption Tax. .............................................    15
      3.5   Other Tax. ...................................................    15

ARTICLE 4  CLOSING .......................................................    16

      4.1   Transfer of Purchased Assets and Purchased IT Assets. ........    16
      4.2   Payment for Purchased Assets and Purchased IT Assets. ........    16
      4.3   Offset. ......................................................    16
      4.4   SCI's Deliveries. ............................................    17

ARTICLE 5  REPRESENTATIONS AND WARRANTIES OF SCI, SE, SECL AND SC ........    17

      5.1   SCI's Representation and Warranties. .........................    17

ARTICLE 6  REPRESENTATIONS AND WARRANTIES OF OSKK AND OSI ................    23

      6.1   Representations and Warranties of OSKK and OSI. ..............    23

ARTICLE 7  ACTION PRIOR TO THE COMPLETION OF THE TRANSACTION .............    25

      7.1   Investigation of the Business by OSI and OSKK. ...............    25
</TABLE>
<PAGE>
                                      -ii-

                                TABLE OF CONTENTS
                                   (CONTINUED)
<TABLE>
<CAPTION>
                                                                             PAGE
                                                                             ----
<S>                                                                          <C>
      7.2   Preserve Accuracy of Representations and Warranties. .........    25
      7.3   Notice of Certain Matters. ...................................    25
      7.4   Business Prior to the Closing Date. ..........................    26
      7.5   Transferred Warranties. ......................................    27

ARTICLE 8   SUBSIDY, EXCHANGE RATE and UNDELIVERED ORDERS ................    27

      8.1   Subsidy. .....................................................    27
      8.2   Exchange Rate. ...............................................    27
      8.3   Undelivered Orders. ..........................................    28

ARTICLE 9  CONDITIONS PRECEDENT TO OBLIGATIONS OF OSI AND OSKK ...........    28

      9.1   No Misrepresentation or Breach of Covenants and Warranties. ..    28
      9.2   No Restraint or Litigation. ..................................    29
      9.3   Necessary Approvals. .........................................    29
      9.4   Employees. ...................................................    29
      9.5   No Material Adverse Change. ..................................    29
      9.6   Contract with Chart K.K. or Other Third Party Distributor. ...    29
      9.7   Contract with SE. ............................................    29
      9.8   Purchased IT Assets and Leases and Licenses. .................    29
      9.9   Contract with regard to the Leased Premises. .................    30
      9.10  License Agreements with SC. ..................................    30

ARTICLE 10  CONDITIONS PRECEDENT TO OBLIGATIONS OF SCI, SE, SECL AND SC ..    30

      10.1  No Misrepresentation or Breach of Covenants and Warranties. ..    30
      10.2  No Restraint or Litigation. ..................................    30

ARTICLE 11  INDEMNIFICATION ..............................................    31

      11.1  Indemnification by SCI. ......................................    31
      11.2  Indemnification by SE, SECL and SC. ..........................    31
      11.3  Indemnification by OSKK and OSI. .............................    32
      11.4  NO CONSEQUENTIAL OR PUNITIVE DAMAGES. ........................    32

ARTICLE 12  TERMINATION ..................................................    32

      12.1  Termination. .................................................    32
      12.2  Notice of Termination. .......................................    33
      12.3  Effect of Termination. .......................................    33

ARTICLE 13  GUARANTEES ...................................................    33

      13.1  SE's Guarantee. ..............................................    33
      13.2  OSI's Guarantee. .............................................    33

ARTICLE 14  GENERAL PROVISIONS ...........................................    34
</TABLE>
<PAGE>
                                     -iii-
<TABLE>
<CAPTION>
                                                                             PAGE
                                                                             ----
<S>                                                                          <C>
      14.1  Survival of Obligations. .....................................    34
      14.2  No Public Announcements. .....................................    34
      14.3  Notices. .....................................................    34
      14.4  Successors and Assigns. ......................................    35
      14.5  Access to Records After Closing Date. ........................    35
      14.6  Entire Agreement; Amendments. ................................    35
      14.7  Interpretation. ..............................................    36
      14.8  Waivers. .....................................................    36
      14.9  Expenses. ....................................................    36
      14.10 Partial Invalidity. ..........................................    37
      14.11 Execution in Counterparts. ...................................    37
      14.12 Further Assurances. ..........................................    37
      14.13 Confidentiality. .............................................    37
      14.14 Governing Law. ...............................................    38
      14.15 Dispute Resolution. ..........................................    38
      14.16 Force Majeure. ...............................................    38
      14.17 Schedules and Exhibits. ......................................    39
</TABLE>
<PAGE>
                                      -1-

                                MASTER AGREEMENT

      This MASTER AGREEMENT ("Agreement"), dated and made effective as of 2:00
pm, California time, on March 11, 2002, is made by and between:

Ocular Sciences K.K., a corporation duly organized and existing under the laws
of Japan and having its registered office at 1-1-3, Marunouchi, Chiyoda-ku,
Tokyo ("OSKK");

Ocular Sciences, Inc., a corporation duly organized and existing under the laws
of the State of Delaware, the United States and having its registered office at
1855 Gateway Boulevard, Suite 700, Concord, CA 94520 USA ("OSI");

Seiko Contactlens Inc., a corporation duly organized and existing under the laws
of Japan and having its registered office at 28-11, Taito 4-chome, Taito-ku,
Tokyo 110-0016 Japan ("SCI");

Seiko Epson Corporation, a corporation duly organized and existing under the
laws of Japan and having its registered office at 3-5, Owa 3-chome, Suwa-shi,
Nagano-ken 392-8502 Japan ("SE");

Seiko Epson Contact Lens Corporation, a corporation duly organized and existing
under the laws of Japan and having its registered office at 1545 Nakaminowa,
Kamiina-gun, Nagano-ken 399-4601 Japan ("SECL"); and

Seiko Corporation, a corporation duly organized and existing under the laws of
Japan and having its registered office at 7-1, Kyobashi 1-chome, Chuo-ku, Tokyo
104-8331 Japan ("SC").

                                    RECITALS

      A. SCI is distributing conventional contact lenses, both soft lenses and
hard lenses manufactured by SECL (which SCI purchases from SE), disposable
contact lenses (which SCI purchases and imports from OSI), and other contact
lens related products to other distributors and retailers in Japan.

      B. SCI desires to sell certain assets and provide certain services related
to SCI's distribution of contact lenses and contact lens related products, and
OSKK desires to commence its business of distribution of contact lenses and
contact lens related products in Japan utilizing, among others, such assets and
services to be sold and provided by SCI in accordance with the terms and
conditions of this Agreement.

      C. As of the Effective Date, SE and SC hold respectively fifty percent
(50%) of all issued and outstanding shares of SCI and jointly control SCI.
However, after the Effective Date, but prior to the Closing Date, SE shall hold
one hundred percent (100%) of all issued and outstanding shares of SCI and shall
have sole control of SCI.
<PAGE>
                                      -2-

      NOW, THEREFORE, in consideration of the foregoing premises and the mutual
covenants, representations, warranties, conditions and agreements herein
contained, the parties hereto hereby agree as follows:

                                    ARTICLE 1

                                   DEFINITIONS

      1.1   Definitions.

      In this Agreement (including exhibits and schedules), all capitalized
terms shall have the meanings set forth in Schedule 1.1 and shall be equally
applicable to both the singular and plural forms.

                                    ARTICLE 2

                                   AGREEMENTS

      2.1   Purchase and Sale of Assets.

      (a) On the terms and subject to the conditions of this Agreement, on and
as of the Closing Date, SCI agrees to sell, transfer, convey, assign and deliver
to OSKK, and OSKK agrees to buy and acquire from SCI, free and clear of all
Encumbrances, all right, title and interest of SCI in and to the assets more
fully described below (excluding those assets excluded from the definition of
Purchased Assets set forth in Schedule 1.1 hereto) (collectively, the "Purchased
Assets"):

            (i) all tangible fixed assets, including, without limitation,
leasehold improvements, personal property and fixtures and equipment (including
computers), other than real properties to which SCI has an ownership interest as
of the Closing Date ("Tangible Fixed Assets"). A list of tangible fixed assets
owned by SCI as of the Record Date for which SCI has recorded a positive book
value (excluding Tangible Fixed Assets that will be transferred to OSKK without
charge) is provided on Schedule 2.1(a)(i)(x) hereto and a list of tangible fixed
assets owned by SCI as of the Record Date for which SCI has recorded a zero book
value or which will be transferred to OSKK without charge is provided in
Schedule 2.1(a)(i)(y) hereto. OSKK will not purchase tangible fixed assets to
which SCI has obtained or will obtain ownership after the Record Date without
OSKK's written consent;

            (ii) all SCI's accounts receivable, net of bad debt write-offs and
offsets as of the Closing Date other than (x) accounts receivable with respect
to which the payer is OSI or an Affiliate of OSI, (y) accounts receivable
outstanding for more than one hundred twenty-two (122) days and (z) notes and
bills receivable ("Accounts Receivable"). A list of SCI's accounts receivable,
net of bad debt write-offs and offsets, as of the Record Date, and the book
value therefor as of the Record Date is provided on Schedule 2.1(a)(ii) hereto;
<PAGE>
                                      -3-

            (iii) all Non-Consigned Inventories of SCI as of the Closing Date. A
list of Non-Consigned Inventories owned by SCI as of the Record Date, and the
book value therefor as of the Record Date is provided on Schedule 2.1(a)(iii)
hereto;

            (iv) all Consigned Inventories of SCI as of the Closing Date. A list
of Consigned Inventories owned by SCI as of the Record Date, and the book value
therefor as of the Record Date is provided on Schedule 2.1(a)(iv) hereto; and

            (v) all intangible assets owned by SCI as of the Closing Date
("Intangible Assets") including, without limitation, (a) the customers list, (b)
the sales know-how, (c) the know-how relating to the Pharmaceutical Affairs Law
of Japan (Law No. 145 of 1960), (d) the know-how of the treatment and the test
of the lenses, (e) all reasonably useful information related to SCI's business,
provided that, such information is not subject to any third party
confidentiality obligations that would prohibit the transfer to OSKK, (f) all
books and records of SCI related to the Purchased Assets including, without
limitation, all repair and maintenance records and operation manuals, (g)
[intentionally omitted], (h) all Intellectual Property owned by SCI, including
the trademarks listed in Schedule 2.1(a)(v)(h), and (i) telephone subscription
rights (denwa-kanyu-ken) ("Telephone Subscription Rights"), provided on Schedule
2.1(a)(v)(i).

In addition, on the terms and subject to the conditions of this Agreement, on
and as of the Closing Date, SCI shall transfer all rights and obligations with
respect to Undelivered Orders approved by OSI or OSKK in accordance with Article
8.3.

      (b) On the terms and subject to the conditions of this Agreement, on and
as of the Closing Date, (i) SCI agrees to sell, transfer, convey, assign and
deliver to OSKK, and OSKK agrees to buy and acquire from SCI, free and clear of
all Encumbrances, all right, title and interest of SCI in and to the Purchased
IT Assets and (ii) SCI agrees to transfer and assign to OSKK the leases and
licenses set forth on Schedule 2.3(b) attached hereto (the "Leases and
Licenses"), to the extent such Leases and Licenses are transferable pursuant to
Article 2.3(b).

      (c) On or prior to the Closing Date, SCI shall deliver the following to
OSKK or the places designated by OSKK at SCI's cost:

            (i) the Purchased Assets and Purchased IT Assets;

            (ii) All assets, materials, data, documents, electronic files or
media which contain or are the subject of the Intangible Assets, the Purchased
IT Assets and the Leases and Licenses (to the extent transferable in accordance
with Article 2.3(b)). SCI will provide OSKK with originals of the foregoing
media, except where SCI is required to submit an original by government
authorities (e.g., tax purposes), in which case, SCI will provide OSKK with a
copy of such original;

            (iii) Certificates of title or origin (or like documents) with
respect to the Purchased Assets and Purchased IT Assets for which a certificate
of title or origin is required in order to transfer title;
<PAGE>
                                      -4-

            (iv) All consents, waivers or approvals required to be obtained by
SCI with respect to the Purchased Assets and the Purchased IT Assets and the
consummation of the transactions contemplated by this Agreement, if any;

            (v) Such other bills of sale, assignments and other instruments of
transfer or conveyance as OSKK may reasonably request or as may be otherwise
necessary to evidence and effect the sale, assignment, transfer, conveyance and
delivery of the Purchased Assets, the Purchased IT Assets, and subject to
Article 2.3(b), the Leases and Licenses.

            (vi) all the documents and records related to the Purchased Assets
and  Purchased IT Assets;

            (vii) duly executed documents necessary to change the registered
name of the titleholder from SCI to OSKK of the Intangible Assets.

      (d) The Purchased Assets, the Purchased IT Assets, and subject to Article
2.3(b), the assets subject to the Leases and Licenses, which are under the
custody of third parties other than SCI as of the Closing Date shall be
delivered to OSKK by SCI's instruction to such custodians to keep custody of
such assets for the benefit of OSKK on or after the Closing Date. SCI shall send
a notification stating such instruction to each custodian and the copies thereof
to OSKK immediately after the Effective Date. The contents of such notification
shall be agreed upon by OSKK prior to sending thereof.

      (e) Deliveries by SCI under this Article 2.1 shall be completed upon SCI's
receipt of a written acknowledgement issued by OSKK in a form that OSKK
determines.

      (f) SCI shall cooperate with OSKK in transferring the Purchased Assets and
Purchased IT Assets (in accordance with Article 2.3) in accordance with all
Applicable Laws and OSKK's instruction made from time to time so that OSKK will
obtain the ownership of the Purchased Assets and Purchased IT Assets on the
Closing Date. OSKK will not pay for the cooperation of SCI under this article.

      (g) SCI shall not sell, transfer, convey, assign, deliver, disclose or
dispose of any of the Purchased Assets or the Purchased IT Assets to any third
party other than OSKK and its Affiliates (if so instructed by OSKK); provided,
however, that SCI may sell the Consigned Inventory and Non-Consigned Inventory
to its customers in the ordinary course of SCI's contact lens distribution
business until the Closing Date. SCI shall not permit any third party other than
OSKK and its Affiliates (if so instructed by OSKK) to use, receive any benefit
from, or obtain security interests over, the Purchased Assets or, upon their
acquisition by SCI, the Purchased IT Assets.

      (h) As of the Closing Date, SCI shall not sell, transfer, convey, assign,
deliver, disclose or dispose of any of the Consigned Inventory and Non-Consigned
Inventory to any third party other than OSKK and its Affiliates (if so
instructed by OSKK).

      (i)  On the Closing Date:

            (i)  SCI shall execute and deliver to OSKK the Zantei-Operation
<PAGE>
                                      -5-

Agreement, effective as of the Closing Date;

            (ii) SE shall execute and deliver to OSKK the exclusive supply
agreement in the form of Schedule 2.8(b), effective as of the Closing Date;

            (iii) (x) SC shall execute and deliver to OSKK the license agreement
in the form of Schedule 2.10(b), effective as of the Closing Date and (y) SCI
shall assign the Cielo Trademark License Agreement to OSKK pursuant to a form of
assignment reasonably acceptable to OSKK, the royalties of which shall have been
fully paid by SCI to SC on or prior to the Closing Date through the end of the
term of such agreement, and SC shall deliver to OSKK SC's written consent to
such assignment;

            (iv) SCI and SE shall execute and deliver to OSKK the Clinical and
Analytical Evaluation Services Agreement, effective as of the Closing Date;

            (v)  SCI shall deliver to OSKK the Closing Date Undelivered Orders
in accordance with Article 8.3;

            (vi) OSKK shall execute and deliver to SCI the Zantei-Operation
Agreement, effective as of the Closing Date;

            (vii) OSKK shall execute and deliver to SE the exclusive supply
agreement in the form of Schedule 2.8(b), effective as of the Closing Date;

            (viii) OSKK shall execute and deliver to SC the license agreement in
the form of Schedule 2.10(b), effective as of the Closing Date; and

            (viv) OSKK shall execute and deliver to SCI and SE the Clinical and
Analytical Evaluation Services Agreement, effective as of the Closing Date.

      2.2   Employees.

      (a) OSKK or OSI shall use best efforts to offer employment to all full
time employees and directors of SCI as of the Record Date as listed in Schedule
2.2(a) ("Employees") upon such terms and conditions of employment to be
determined by OSKK or OSI in its sole discretion, but in compliance with all
Applicable Laws.

      (b) SCI shall use best efforts to ensure that all or part of the Employees
to whom OSKK will offer employment will resign from SCI and become employees of
OSKK on or before the Closing Date.

      (c) SCI shall use best efforts from the Effective Date until the Closing
Date to provide OSKK and OSI with supportive services such as persuading
employees of SCI who are listed in Schedule 2.2(c) ("Key People") to be employed
by OSKK at no charge so that OSKK will be able to employ all the Key People on
or before the Closing Date.

      (d) SCI shall disclose all personnel records of each Employee including,
without limitation, the name, SCI employee number, current job assignment,
current rate of wages or salary, and the amount of service to OSKK immediately
after the
<PAGE>
                                      -6-

Effective Date. In the event any Applicable Laws prohibit or restrict the
transfer of personnel information pursuant to this paragraph, the obligations of
SCI shall be to disclose to OSKK only such information as shall be permitted by
such laws or regulations.

      (e) The parties confirm that in the case of Employees who do not accept
the offer of employment extended by OSKK or OSI or to whom OSKK or OSI, despite
best efforts, will not offer employment, the employment of such Employees shall
be within the responsibility of SCI and OSKK shall not be obliged to compensate
them in any manner or to extend another offer of employment.

      (f) SE and SCI shall respect the rights of SCI's employees whom OSKK or
OSI, despite their best efforts, will not offer employment in OSKK.

      (g) SCI shall retain one (1) engineer as an employee of SCI as listed in
Schedule 2.2(h) ("SCI Liaison"). Such employee will be a liaison between SCI and
OSKK in accordance with the Zantei-Operation Agreement (Schedule 2.6(b)), and
will become an employee of OSKK upon termination of the Zantei-Operation
Agreement if the terms and conditions of employment which OSKK will offer to
such employee are accepted by such employee.

      2.3 Purchased IT Assets and Leases and Licenses.

      (a) On or prior to the Closing Date, SCI will purchase from Century
Leasing Company the assets listed on Schedule 2.3(a) (the "Purchased IT Assets")
at the prices listed on Schedule 2.3(a), and thereafter on the Closing Date, SCI
will transfer the Purchased IT Assets to OSKK.

      (b) With respect to SCI's Leases and Licenses listed on Schedule 2.3(b),
between the Effective Date and the Closing Date, SCI and SE will use their best
efforts to obtain the consent of the lessors and licensors to the assignment of
the Leases and Licenses to OSKK on and as of the Closing Date, and with respect
to those Leases and Licenses in which the lessor's or licensor's consent to such
transfer is obtained, on the Closing Date, SCI will transfer such Leases and
Licenses to OSKK. With respect to those Leases and Licenses in which the lessor
or licensor has not consented to the assignment to OSKK prior to the Closing
Date, (i) SCI and SE will use their best efforts to provide OSKK with supportive
services including, without limitation, negotiating with the respective lessors
and licensors in obtaining consent to assignment and/or procuring new leases or
licenses of the assets subject to such Leases and Licenses to OSKK effective on
the Closing Date on similar terms and conditions as those currently extended to
SCI and (ii) to the extent legally permissible, SCI will hold the rights under
such Leases and Licenses in trust for, and for the benefit of, OSKK, and will
cooperate with OSKK in any reasonable arrangement necessary to provide that OSKK
shall receive substantially all beneficial interest and benefits in, to and
under such Leases and Licenses, and OSKK will perform SCI's obligations and
liabilities under such Leases and Licenses, provided that, with respect to
obligations and liabilities requiring the payment of money, SCI will, at the
request of OSKK, make such payments on OSKK's behalf, subject to SCI's
contemporaneous receipt from OSKK of reimbursement therefor. Except as set forth
in this Article 2.3(b), OSKK will not pay for such supportive services to be
<PAGE>
                                      -7-

provided by SCI and SE. True and correct copies of the Leases and Licenses have
been provided by SCI to OSKK prior to the Effective Date.

      2.4 Distribution Service.

      (a) SCI and SE shall use best efforts to assure that on or prior to the
Closing Date, Chart K.K. will enter into an agreement with OSKK in substantially
the form attached hereto as Schedule 2.4(a).

      (b) SCI and SE shall never represent or imply directly or indirectly to
Chart K.K. that OSKK will assume SCI's liabilities, obligations or commitments
against Chart K.K., and SCI and SE shall, jointly and severally, indemnify OSKK
and OSI against any and all such liabilities, obligations or commitments to
Chart K.K. incurred by OSKK or OSI.

      (c) OSKK will not pay for the assistance of SCI and SE under this article.

      2.5 Agreements with Other Entities.

      (a) SCI shall use its best efforts so that OSKK can enter into new
agreements (i) with distributors and retailers with which SCI entered into
agreements to sell its products continuously until the Effective Date, and (ii)
with suppliers with which SCI entered into agreements to purchase certain items
until the Effective Date.

      (b) SCI shall use its best efforts so that OSKK can enter into new
agreements with lessors of the Leased Premises with which SCI entered into
agreements, at commercially reasonable terms and conditions.

      (c) Those distributors, retailers, suppliers and lessors (in accordance
with Articles 2.5(a) and 2.5(b)) with which OSKK seeks to enter into such
agreements are listed in Schedule 2.5(c) hereto ("Counter-parties").

      (d) Upon OSKK's reasonable requests made from time to time, on or after
the Effective Date, SCI shall call, write or visit Counter-parties in order to
explain the transaction contemplated hereby between OSKK and SCI and persuade
them to enter into new agreements with OSKK at commercially reasonable terms and
conditions to assist OSKK to conduct its contact lens business and other
businesses related thereto smoothly and effectively.

      (e) SCI shall perform their duties under this article in accordance with
OSKK's reasonable instructions conveyed from time to time.

      (f) SCI shall report to OSKK using a report form designated by OSKK
immediately after each communication with Counter-parties to be made from time
to time after the Effective Date.

      (g) SCI shall never represent or imply directly or indirectly to the
Counter-parties that OSKK will assume SCI's liabilities, obligations or
commitments against Counter-parties, and SCI and SE shall, jointly and
severally, indemnify OSKK and
<PAGE>
                                      -8-

OSI against any and all such liabilities, obligations or commitments to any and
all Counter-Parties incurred by OSKK or OSI.

      (h) OSKK will not pay for the assistance of SCI under this article.

      2.6 License.

      (a) SCI and SE shall make their best efforts to cooperate with OSKK,
including, but not limited to, making necessary documents and visiting and
negotiating with the authorities, so that OSKK can (1) obtain the license for
importation and sales of medical devices (iryoyogu-yunyu-hanbai-kyoka), (2)
succeed to the necessary authorizations for such importation (yunyu-shonin)
which SCI has as of the Effective Date, (3) file necessary reports with the
appropriate authorities, and (4) accomplish other required procedures in order
to assist OSKK in conducting its contact lens business and business related
thereto smoothly and effectively on or after the Closing Date under the
Pharmaceutical Affairs Law of Japan, in relation to the products that are
currently distributed by SCI in Japan until OSKK has completed these procedures.

      (b) On or prior to the Closing Date, SCI and OSKK shall enter into an
agreement with respect to the terms and conditions of SCI's and/or SE's
cooperation pursuant to Article 2.2(h) and this Article 2.6, in a form attached
hereto as Schedule 2.6(b) ("Zantei-Operation Agreement"), which shall be based
on the Disposable Distribution Agreement and the Daily Wear Distribution
Agreement (both dated November 7, 1996); provided that, OSI shall issue to SCI
an invoice consistent with the Zantei-Operation Agreement, and SCI's payment
thereof shall be made within sixty (60) days from the first (1st) day of the
month following SCI's receipt of the relevant invoice.

             (i) Mr. Okazaki's secondment is intended, in part, as a means for
OSKK to get such cooperation on the import license process and thereby require
less reliance and support from SE and SCI while OSKK is completing these
procedures.

            (ii) Except as otherwise provided herein, other cooperative support
from SCI while OSKK is completing these procedures shall be without charge.

      (c) On or prior to when OSKK successfully obtains under its name the
license for importation and sales of medical devices and succeeds to the
necessary authorizations for such importation from SCI for the products that SCI
currently imports and distributes in Japan, SCI shall import and sell such
products to OSKK in the amount that OSKK requires from time to time at the same
price which SCI purchases them from OSI (including any and all Tax and
incidental costs) in accordance with the Zantei-Operation Agreement.

      (d) OSKK shall make payment for any and all invoices issued by SCI
consistent with the Zantei-Operation Agreement to OSKK within sixty (60) days
from the first (1st) day of the month following OSKK's receipt of the relevant
invoice.

      2.7   Cooperation.
<PAGE>
                                      -9-

      Upon the terms and subject to the conditions contained herein, the parties
agree (a) to use all reasonable efforts to take, or cause to be taken, all
actions and to do, or cause to be done, all things necessary, proper or
advisable to consummate and make effective the transactions contemplated by this
Agreement, (b) to execute any documents, instruments or conveyances of any kind
which may be reasonably necessary or advisable to carry out the transactions
contemplated hereunder, and (c) to cooperate with each other in connection with
the foregoing.

      2.8   Supply of Conventional Lenses.

      (a) SE shall supply OSKK exclusively with all conventional contact lenses
and solutions products manufactured or dealt in by SECL as of the Effective Date
until the end of March 2005. SE and/or SECL shall not be required to, and shall
not, purchase from OSKK any conventional contact lenses remaining in OSKK's
inventory as of the end of March 2005.

      (b) SE and OSKK shall enter into an exclusive supply agreement in a form
listed in Schedule 2.8(b) on or prior to the Closing Date.

      2.9   Accounts Receivable.

      (a) Within seven (7) days after the Closing Date, SCI shall dispatch
executed notices of assignment (saiken-joto-tsuchi) to each payer of an Account
Receivable as of the Closing Date in a form listed in Schedule 2.9(a), notifying
the payer of the assignment of Account(s) Receivable from SCI to OSKK and
directing that payment of the Account Receivable be made to OSKK and not to SCI.
SCI shall provide copies of such notices to OSKK upon dispatch.

      (b) Any payments received by SCI for Accounts Receivable transferred to
OSKK shall be promptly remitted to OSKK. If there still remain accounts
receivable which have not been paid in cash among the Accounts Receivable as of
the two-hundred and fourteenth (214th) day following the Closing Date, OSKK and
SCI shall treat the difference between the amount of the consideration for the
Accounts Receivable set forth in Article 3.1(b) and the actual amount that OSKK
collected in cash as of the two-hundred and fourteenth (214th) day following the
Closing Date as follows:

            (i) If the total actual amount OSKK collected in cash is more than
the amount of the consideration for the Accounts Receivable set forth in Article
3.1(b), OSKK will be entitled to all the surplus; and

            (ii) If the total actual amount OSKK collected in cash is less than
the amount of the consideration for the Accounts Receivable set forth in Article
3.1(b), SCI shall pay OSKK an amount equal to the deficit between such actual
amount collected in cash by OSKK and the amount of the consideration for the
Accounts Receivable set forth in Article 3.1(b). The amount shall be paid not
later than the two-hundred and fortieth (240th) day following the Closing Date
by wire transfer of immediately available funds to a bank account designated by
OSKK at SCI's cost.
<PAGE>
                                      -10-

       (c) Until the two-hundred and fourteenth (214th) day following the
Closing Date, OSKK shall first apply all cash received by OSKK in payment of
accounts receivable from each debtor under Accounts Receivable transferred from
SCI to OSKK on the Closing Date to reduce the balance of the Accounts Receivable
from that debtor transferred from SCI to OSKK.

      (d) On the two hundred and fortieth (240th) day following the Closing
Date, SCI shall pay to OSKK, by wire transfer of immediately available funds to
a bank account designated by OSKK, at SCI's cost, an amount equal to the Return
Credit. For purposes of this Agreement, the term "Return Credit" shall be an
amount equal to the sum of the following with respect to product returns made
during the two hundred fourteen (214) days following the Closing Date by debtors
whose Accounts Receivable were assigned to OSKK pursuant to this Agreement:

            (i) with respect to any defective products so returned by the
debtor, the amount of the Account Receivable arising from the sale of the
returned product to the debtor;

            (ii) with respect to product so returned by the debtor for the
reason that the debtor made an error in ordering the product, an amount (the
"Gross Margin") equal to the Account Receivable arising from the sale of the
returned product to the debtor less the book value of the product as reflected
in the books of SCI immediately prior to the sale of the product to the debtor;

            (iii) with respect to products returned upon termination of the
commercial relationship with a debtor, an amount equal to (x) with respect to
returned product that is a Discontinued Product, the amount of the Account
Receivable arising from the sale of the returned Discontinued Product to the
debtor, and (y) with respect to returned product that is not a Discontinued
Product, the Gross Margin related to the returned product; and

            (iv) with respect to any product returned that is a Discontinued
Product, the amount of the Account Receivable arising from the sale of the
returned product to the debtor.

      2.10  Trademarks Proprietary to SC.

      On the Closing Date, (a) SC and OSKK shall enter into a license agreement
in a form listed in Schedule 2.10 by which SC shall grant licenses on the
"Seiko" trademark to OSKK upon terms and conditions set forth in such agreements
and (b) SCI will assign the Cielo Trademark License Agreement to OSKK, pursuant
to which OSKK will receive a fully-paid license to use the "Cielo" trademark,
and SC shall consent to such assignment.

      2.11  Option to Purchase Intellectual Property Proprietary to SE and/or
SECL.

      SECL and SE hereby grant OSKK, OSI and their Affiliates an option,
effective on the Closing Date, to purchase certain manufacturing know-how,
patents, approvals for manufacturing SECL products issued under the
Pharmaceutical Affairs
<PAGE>
                                      -11-

Law of Japan and other Intellectual Properties owned by SE and/or SECL which are
necessary and/or useful to manufacture and/or market the products manufactured
by SECL as of the Record Date for an amount of 400,000 US Dollars exercisable at
any time before March 31, 2005. A list of such Intellectual Properties owned by
SE and/or SECL as of the Record Date is provided on Schedule 2.11 hereto. In the
event that such manufacturing know-how, patents and other Intellectual
Properties include any joint patents or other joint rights with third parties,
SE and SECL shall make commercially reasonable efforts to obtain the joint
party's consent as to the assignment thereof.

      2.12 Clinical and Analytical Evaluation Services and Use of Clinical and
           Analytical Instruments of SE; Option to Purchase.

      (a) Upon requests made from time to time by OSKK or OSI, SCI and SE shall
provide, with charge, support services in connection with clinical and
analytical evaluation requirements (including the use of Clinical and Analytical
Instruments and services related thereto) in compliance with the Pharmaceutical
Affairs Law of Japan. On or prior to the Closing Date, SCI, SE and OSKK shall
enter into an agreement (the "Clinical and Analytical Evaluation Services
Agreement") with respect to such services and use of Clinical and Analytical
Instruments pursuant to this Article 2.12(a) and on the terms and conditions set
forth on Schedule 2.12(a) attached hereto.

      (b) SE hereby grants OSKK, OSI and their Affiliates an option, effective
on the Closing Date, to purchase certain Clinical and Analytical Instruments
owned by SE. This option to purchase such Clinical and Analytical Instruments
shall be at their book value at the time of such exercise of option, which must
be exercised no later than March 31, 2005. A list of such Clinical and
Analytical Instruments owned by SE is attached hereto as Schedule 2.12(b).

      2.13  After-Sales Service.

      After the Closing Date, OSKK shall provide after-sales services for the
Consigned Inventories, Non-Consigned Inventories and other contact lens related
products sold by SCI before the Closing Date. The contents, quality and method
of the after sales services to be provided by OSKK shall be solely determined by
OSKK at its discretion; provided that, OSKK shall fully defend, indemnify and
hold harmless SCI against any and all Losses and Expenses in connection with any
and all claims, lawsuits or proceedings arising from any and all such
after-sales services provided by OSKK, except to the extent such Losses and
Expenses are Excluded Liabilities.

      2.14 [Intentionally Omitted]
<PAGE>
                                      -12-

      2.15  Liabilities and Obligations.

      Unless otherwise provided herein, OSKK shall not assume or have any
responsibility for any liability, obligation or commitment of any nature of SCI,
whether now or hereafter existing, known or unknown, accrued or non-accrued, or
due or to become due, including, without limitation, the Excluded Liabilities.

      2.16  Non Competition.

      (a) In order to avoid any competition with OSKK, as of the Closing Date
and until March 31, 2005, none of SE, SC, SECL and SCI shall, within the
territory of Japan, conduct or have its Affiliate conduct, any business directly
relating to the manufacture and/or distribution of contact lenses and/or
solutions. Notwithstanding the foregoing, this Article 2.16 shall not prohibit
SE, SC, SECL and SCI from making retail sales of contact lenses or solutions, in
the ordinary course of business consistent with past practice, to consumers who
do not purchase the contact lenses or solutions for the purpose of resale or
re-distribution.

      (b) In order to avoid any competition with OSI, as of the Closing Date and
for a period of one (1) year thereafter, none of SE, SC, SECL and SCI shall
conduct or have its Affiliate conduct, any business in Japan nor elsewhere in
the world, relating to the manufacture of colored disposable contact lenses
using or incorporating SE's proprietary ink-jet printing technology.

      (c) Notwithstanding the foregoing, this article shall not apply to: (a)
SE's supply of the products to OSKK in accordance with Article 2.8, and (b)
SCI's assistance in accordance with Article 2.6.

      2.17  Right of First Refusal.

      (a) Subject to this Article 2.17, OSI shall have the right of first
refusal to enter into a feasibility study agreement involving a new application
for SE's proprietary ink-jet printing technology in connection with contact
lenses (for example, laying colored ink on disposable contact lenses) with SE.
In the event that OSI proposes to undertake such a feasibility study, OSI shall
deliver to SE written notice of its desire to undertake such a feasibility study
no later than one (1) year after the Closing Date.

      (b) Upon OSI's delivery of such notice in writing in accordance with
Article 2.17(a), the parties shall thereafter negotiate in good faith the terms
and conditions of a feasibility study agreement pursuant to which OSI shall be
an exclusive party. OSI acknowledges that SE will not disclose proprietary
information related to SE's ink-jet technology during the course of any
feasibility study or discussions related thereto.

      (c) If (i) OSI fails to deliver its notice in writing to SE in accordance
with Article 2.17(a), or (ii) despite negotiations in good faith, the parties
fail to fully execute a feasibility study agreement within eighteen (18) months
after the Closing Date, then OSI shall forfeit the right herein to (1) be an
exclusive party to any such feasibility study, and (2) enter into any
feasibility study agreement. SE may thereafter seek any third party for, and
enter into with such third party, any feasibility study
<PAGE>
                                      -13-

agreement (on an exclusive or non-exclusive basis) as if OSI's right of first
refusal herein were not exercised.

      (d) Except to the extent provided in Article 2.16(b) and this Article
2.17, nothing in this Agreement shall be construed to limit SE's ability and
right to develop, license and offer to license its ink-jet printing technology
to third parties for any purpose whatsoever, including, licenses to third
parties to manufacture, have manufactured, sell, offer to sell, import, export
or otherwise dispose of any products using or incorporating SE's ink-jet
printing technology.

                                    ARTICLE 3

                                  CONSIDERATION

      3.1   Consideration.

      All consideration described in Article 3.1 (a) to (g) below shall be
exclusive of any applicable consumption tax levied in accordance with the
Consumption Tax law of Japan:

      (a) The consideration for the transfer of all of the Tangible Fixed Assets
shall be the book value of the Tangible Fixed Assets listed on Schedule
2.1(a)(i)(x) hereto as of the Closing Date.

      (b) Subject to the adjustment in accordance with Article 2.9(b), the
consideration for the transfer of the Accounts Receivable shall be ninety-four
(94)% of the book value of Accounts Receivable as of the Closing Date.

      (c) The consideration for the transfer of the Non-Consigned Inventories
shall be the sum of (i) the book value for the Non-Consigned Inventories other
than those SCI purchased from SE and other than 1-day disposable lenses and
2-week disposable lenses and (ii) for the Non-Consigned Inventories which SCI
purchased from SE (including, but not limited to, the contact lenses and
solutions) other than 1-day disposable lenses and 2-week disposable lenses, the
lesser amount of either (x) the book value as of the Closing Date or (y) the
price that SCI paid to SE, and (iii) OSKK will pay US$0.40 per one unit of 1-day
disposable lenses and US$0.58 per one unit of 2-week disposable lenses, minus
(iv) 260,000 US Dollars. Notwithstanding the foregoing, OSKK will not pay for
the Non-Consigned Inventories that are Excepted Inventories.

      (d) The consideration for the transfer of the Consigned Inventories shall
be fifty percent (50%) of the book value as of the Closing Date. Notwithstanding
the foregoing, OSKK will not pay for the Consigned Inventories which consist of
Discontinued Products.

      (e) The consideration for the transfer of the Intangible Assets, excluding
Telephone Subscription Rights and the Purchased IT Assets, shall be Four Million
US dollars (US$4,000,000).
<PAGE>
                                      -14-

      (f) The consideration for the transfer of Telephone Subscription Rights
(denwa-kanyu-ken) including telex and facsimile used by SCI for its contact lens
business and business related thereto shall be at 20,000 (twenty thousand) yen
per each right.

      (g) The consideration for the transfer of the Purchased IT Assets shall be
an amount equal to the sum of the amounts paid by SCI to Century Leasing Company
to acquire the Purchased IT Assets after the Effective Date and on or prior to
the Closing Date, but in no event, more than thirty two million, eight hundred
and fifty-two thousand (32,852,000) yen; provided that, such amount is exclusive
of any and all consumption tax, and OSKK shall reimburse SCI for any and all
consumption tax in accordance with Article 3.4.

      (h) The book value and the consideration payable by OSKK with respect (a)
through (d) of this Article shall be determined in accordance with Article 3.2.

      (i) The consideration payable by OSKK with respect to (f) and (g) of this
Article shall be determined in accordance with Article 3.2.

      (j) OSKK shall not be obliged to pay any amount other than the
considerations provided under this article unless otherwise so provided in this
Agreement.

      3.2 Consideration and Determination of Closing Assets.

      (a) In order to determine the amount of consideration payable under
Article 3.1(a) through (d) and (f) and (g), within fifteen (15) days following
the Closing Date, SCI will prepare in good faith and deliver to OSKK schedules
identifying in reasonable detail the following (collectively the "Closing Asset
Schedules"):

               (i) the Tangible Fixed Assets as of the Closing Date and their
individual and aggregate book value as of the Closing Date;

               (ii) the Accounts Receivable as of the Closing Date, the number
of days each individual receivable has been outstanding as of the Closing Date,
and the individual and aggregate book value of the Accounts Receivable as of the
Closing Date (the "Closing Accounts Receivable Schedule");

                (iii) the Consigned Inventory (including the location of the
Consigned Inventory) as of the Closing Date and the consideration payable with
respect to the Consigned Inventory determined in accordance with Article 3.1 and
this Article 3.2 as of the Closing Date and the Merchantable Non-Consigned
Inventory as of the Closing Date and the consideration payable with respect to
the Merchantable Non-Consigned Inventory determined in accordance with Article
3.1 and this Article 3.2 as of the Closing Date, each determined by a physical
count of the Inventory by SCI and OSKK immediately prior the Closing Date (the
"Closing Merchantable Inventory Schedule");

                (iv) the Excepted Inventory as of the Closing Date determined by
a physical count of the Inventory by SCI and OSKK immediately prior to the
Closing Date (the "Closing Excepted Inventory Schedule");
<PAGE>
                                      -15-

                (v) the Telephone Subscription Rights, indicating the number and
identification of such rights and the aggregate consideration to be paid for
such rights determined in accordance with Article 3.1(f); and

               (vi) the Purchased IT Assets and the consideration payable by
OSKK with respect to the Purchased IT Assets determined in accordance with
Article 3.1(g).

      (b) For purposes of this Agreement, "book value" shall be determined in
accordance with SCI's accounting policies and practices, applied in a manner
consistent with SCI's past practices. A copy of SCI's accounting policies and
practices is set forth on Exhibit B hereto.

      (c) SCI and OSKK shall meet to discuss and agree on the Closing Asset
Schedules during the period commencing on the date of SCI's delivery of the
Closing Asset Schedules and continuing, if necessary, until the Payment Date. In
the event OSKK and SCI cannot agree on the Closing Asset Schedules, an
independent and impartial third party accountant or appraiser employed by a big
five accounting firm agreeable to both SCI and OSKK shall determine the book
value of the Tangible Fixed Assets, Accounts Receivable, Non-Consigned
Inventories and Consigned Inventories as of the Closing Date, such determination
to be final and binding, and OSKK and SCI shall equally bear the third party
accountant or appraiser fees.

      (d) OSI and OSKK shall have the right to conduct an audit, or cause an
audit to be conducted on their behalf, of the Purchased Assets and Purchased IT
Assets, which audit may include a physical count of the Inventory, and SCI and
SE shall provide such information and assistance during such audit as may be
reasonably requested by OSI and OSKK.

      3.3   Stamp Duty.

      Stamp duty payable in connection with the execution of this Agreement
shall be borne by SCI and OSKK equally.

      3.4   Consumption Tax.

      Consumption tax payable in connection with the execution of this Agreement
in accordance with the Consumption Tax law of Japan shall be borne entirely by
OSKK.

      3.5 Other Tax.

      (a) Unless otherwise provided herein, SCI shall be responsible for and pay
all Tax of SCI, the Purchased Assets and the Purchased IT Assets arising at any
time with respect to periods ending on or prior to the Closing Date, including
the portion of real, personal or other property Tax attributable to such
periods.

      (b) Unless otherwise provided herein, OSI and/or OSKK shall be responsible
for and pay all Tax of OSI and/or OSKK, the Purchased Assets and the Purchased
IT
<PAGE>
                                      -16-

Assets arising at any time with respect to the period beginning and
continuing after the Closing Date, including any portion of real, personal or
other property Tax attributable to such period.

                                    ARTICLE 4

                                     CLOSING

      4.1   Transfer of Purchased Assets and Purchased IT Assets.

      Subject to fulfillment or waiver by SCI of the conditions set forth in
Article 10 below, SCI will transfer all right, title, ownership and any other
benefit in the Purchased Assets, the Purchased IT Assets and, to the extent
transferable, the Leases and Licenses, free and clear of all Encumbrances
(except those disclosed in Schedule 4.1(a)), to OSKK on the Closing Date.

      4.2   Payment for Purchased Assets and Purchased IT Assets.

      (a) Subject to fulfillment or waiver by OSKK of the conditions set forth
in Article 9 below and the completion of deliveries in accordance with Article
4.4, in exchange for the deliveries set forth in Article 2.1, on the Closing
Date, OSKK shall make payment of the amount of the consideration for the
Intangible Assets set forth in Article 3.1(e) to SCI by wire transfer of
immediately available funds to a bank account designated by SCI.

      (b) Subject to fulfillment or waiver by OSKK of the conditions set forth
in Article 9 below and the completion of the deliveries in accordance with
Articles 2.1 and 4.4 on or prior to the Closing Date, and the completion of the
deliveries and procedures set forth in Article 3.2, on the Payment Date, OSKK
shall make payment of the sum of the consideration for the Purchased Assets,
Telephone Subscription rights and Purchased IT Assets set forth in Articles
3.1(a) through (d) and 3.1 (f) and (g) to SCI by wire transfer of immediately
available funds to a bank account designated by SCI.

      4.3   Offset.

      Notwithstanding Article 4.2, OSKK may offset SCI's accounts payable to OSI
which OSI will transfer to OSKK with all and any of OSKK's accounts payable to
SCI under this Agreement on each of the Closing Date and the Payment Date. On or
prior to each of the Closing Date and the Payment Date, OSI shall inform SCI in
writing of the amount of SCI's accounts payable to OSI which OSI will transfer
to OSKK. Subject to Article 11.3(c), SCI hereby gives OSI its consent without
any objection to OSI's transfer of SCI's accounts payable to OSKK. If, on the
Payment Date, the total amount of OSKK's accounts payable to SCI under this
Agreement is less than the amount of SCI's accounts payable to OSI which OSI
will transfer to
<PAGE>
                                      -17-

OSKK, SCI shall pay such difference to OSKK on the Payment Date by wire transfer
of immediately available funds to a bank account designated by OSKK.

      4.4   SCI's Deliveries.

      On the Closing Date, SCI shall deliver to OSKK copies of the minutes of
the resolutions of the Board of Directors of SCI and the general meeting of
shareholders of SCI authorizing the execution and performance of this Agreement
and the transactions contemplated hereby, certified by the representative
directors thereof.

                                    ARTICLE 5

             REPRESENTATIONS AND WARRANTIES OF SCI, SE, SECL AND SC

      5.1   SCI's Representation and Warranties.

      As an inducement to OSI and OSKK to enter into this Agreement and to
consummate the transactions contemplated hereby, SCI represents and warrants to
OSI and OSKK that the statements contained in this Article 5.1 are correct and
complete as of the Effective Date and will be correct and complete as of the
Closing Date:

      (a) Organization of SCI.

      SCI is a corporation duly organized and validly existing under the laws of
Japan. SCI is duly qualified to carry on its business as currently conducted.
SCI has full corporate power and authority to own and use the Purchased Assets
and the Purchased IT Assets (subject to Article 2.3) and to carry on its
business as currently conducted. As of the Effective Date, SE and SC hold
respectively fifty (50) percent of all issued and outstanding shares of SCI.
However, after the Effective Date, but prior to the Closing Date, SE shall hold
one hundred percent (100%) of all issued and outstanding shares of SCI.

      (b) Authorization.

            (i) SCI has full power and authority to execute, deliver and perform
this Agreement and to consummate the transactions contemplated hereby. The
execution, delivery and performance of this Agreement by SCI have been duly and
validly authorized and approved by all required corporate proceedings on the
part of SCI, and do not require any further authorization or consent of SCI.
This Agreement has been duly authorized, executed and delivered by SCI and
constitutes, or upon execution and delivery by SCI will constitute, as the case
may be, legal, valid and binding obligations of SCI enforceable against SCI in
accordance with their terms, subject as to enforcement to applicable insolvency,
bankruptcy, reorganization and
<PAGE>
                                      -18-

other such legal protections for debtors and to injunctive relief being
discretionary to any court.

            (ii) Neither the execution and delivery of this Agreement or the
consummation of any of the transactions contemplated hereby nor compliance with
or fulfillment of the terms, conditions and provisions hereof or thereof will:
(i) violate, conflict with, result in a breach of the terms, conditions or
provisions of, or constitute a default, an event of default or an event creating
rights of acceleration, termination or cancellation or a loss of rights under,
or result in the creation or imposition of any Encumbrance upon any of the
Purchased Assets or Purchased IT Assets under (a) the organizational documents
of SCI, (b) any other note, instrument, agreement, mortgage, lease, license,
franchise, permit or authorization, right, restriction or obligation to which
SCI is a party or any of the Purchased Assets or Purchased IT Assets is subject
or by which any of the Purchased Assets or Purchased IT Assets is bound, (c) any
Governmental Order to which SCI is a party or any of the Purchased Assets or
Purchased IT Assets is subject or by which SCI or any of the Purchased Assets or
Purchased IT Assets is bound, or (d) any Applicable Laws affecting SCI or its
property; or (ii) require the approval, consent, authorization or act of, or the
making by SCI of any declaration, filing or registration with, any Governmental
Body, or any other Person.

      (c) Title to Purchased Assets and Purchased IT Assets.

      SCI has good and indefeasible title to all of the Purchased Assets, and as
of the Closing Date, SCI will have good and indefeasible title to all of the
Purchased IT Assets (subject to Article 2.3), free and clear of all Encumbrances
(except as set forth in Schedule 4.1(a)). Upon delivery to OSKK on the Closing
Date in accordance with Article 2.1 above, SCI will thereby transfer to OSKK
good and indefeasible title to the Purchased Assets and Purchased IT Assets
(subject to Article 2.3), free and clear of all Encumbrances. The Purchased
Assets, together with the Purchased IT Assets, the Leases and Licenses, the
Permits, the Contracts, the Leased Premises and the Clinical and Analytical
Instruments, include all property, rights and assets primarily used in, and
necessary for, the operation of SCI's business as currently conducted. Except as
set forth in Schedule 5.1(c), all of the Tangible Fixed Assets, the Leased
Premises and the tangible assets subject to the Leases and Licenses are in good
operating condition and repair, subject to normal wear and tear, and are usable
in the ordinary course of business as currently conducted.

      (d) Intellectual Property.

      (i) Schedule 2.1(v)(h) sets forth, for each of SCI's registered trademarks
and for each SCI trademark application, the application serial number or
registration number, the class of goods covered and the expiration date for each
country in which any such trademark has been registered.

      (ii) The Purchased Assets, the Purchased IT Assets and the Leases and
Licenses include all Intellectual Property rights necessary to conduct SCI's
business as currently conducted.

      (iii) Neither the execution, delivery and performance of this Agreement
nor the consummation of the transactions contemplated hereby will impair the
right of the
<PAGE>
                                      -19-

OSKK to use, possess, sell or license any Intangible Assets or any portion
thereof. Except as set forth in Schedule 5.1(d)(iii), there are no royalties,
honoraria, fees or other payments payable by SCI to any third person by reason
of the ownership, use, possession, license, sale, marketing, advertising or
disposition of any Intellectual Property used by SCI in the conduct of its
business as currently conducted.

      (iv) The marketing, license, sale, furnishing or intended use of any
product or service related to SCI's business currently licensed, utilized, sold,
provided or furnished by SCI does not violate any license or agreement between
SCI and any third party.

      (v) The marketing, license, sale, furnishing or intended use of the
Purchased Assets (including the Intangible Assets) and the AS400 software
included in the Purchased IT Assets (excluding for purposes of this
representation, products or services manufactured or provided by OSI and its
Affiliates) neither infringes nor misappropriates any Intellectual Property
rights of any other party; and there is no pending or, to the knowledge of SCI,
threatened claim or litigation contesting the validity, ownership or right of
SCI to use, possess, sell, market, advertise, license or dispose of any
Intellectual Property used by SCI in its business.

      (vi) The computer software currently utilized in SCI's business is capable
of meeting the needs of SCI's business as currently conducted and adequately
performs the functions for which it is used, and to the knowledge of SCI,
contains no defects. The Purchased Assets together with the Purchased IT Assets
and the Leases and Licenses contain all of the computer software and rights with
respect to computer software necessary to operate SCI's business as currently
conducted. All license fees due and payable with respect to such computer
software have been paid by SCI for SCI's use of same. OSI and OSKK acknowledge
that OSKK may have to pay fees under Leases and Licenses for OSKK's use of the
assets subject to the Leases and Licenses.

      (e) Employees.

            (i) Schedule 2.2(a) contains a list of all SCI's employees as of the
Effective Date (other than Mr. Kurokawa, Mr. Takanami and Mr. Saito) and a list
of the annual compensation provided by SCI to such employees as of the Effective
Date.

            (ii) Insofar as it pertains to the business currently conducted by
SCI, SCI is not a party to or bound by any union contract and has not
experienced any strike, grievance or any arbitration proceeding, claim of unfair
labor practices filed against SCI or threatened to be filed against SCI or any
other material labor difficulty and there is no labor union of which any of the
Employees is a member. None of the Employees is involved in or is otherwise
threatening a potential labor dispute.

      (f) Contracts.

            (i) Schedules 5.1(f) and 2.3(b) collectively list each contract,
agreement, arrangement, commitment, or other instrument, written or oral, that
is material to the business currently conducted by SCI or the Leased Premises to
which SCI is a party or by which SCI, the Purchased Assets or the business
currently
<PAGE>
                                      -20-

conducted by SCI may be bound (collectively, the "Contracts") as of the
Effective Date, including, without limitation, the following:

            (x) agreements not made in SCI's ordinary course of business;

            (y) the Leases and Licenses;

            (z) confidentiality and non-disclosure agreements (subject to the
terms and conditions therein);

            (xx) agreements containing covenants limiting the freedom of SCI or
any officer, director or employee of SCI to engage in any line of business or
compete with any Person that relates directly or indirectly to SCI's business as
currently conducted;

            (yy) leases of the Leased Premises;

            (zz) material leases of personal property;

            (xxx) material distribution agreements, supply agreements and
customer agreements; and

            (yyy) any other agreement material to the operation of SCI's
business as currently conducted.

            (ii) Each Contract constitutes a valid, legal and binding obligation
of the respective parties thereto; and no defenses, offsets, or counterclaims
thereto have been asserted, or may be made by any party thereto. SCI has not
received notice of any default under any of such Contracts. There are no
material existing defaults or events of default, real or claimed, or events
which with notice or lapse of time or both would constitute a material default
under any Contract. There exists no actual or threatened termination,
cancellation, or limitation of, or any amendment, modification, or change to any
Contract. SCI is neither renegotiating any of the Contracts nor is it paying
damages in lieu of performance thereunder. Complete and correct copies of each
of the written Contracts have heretofore been delivered or will be delivered
prior to the Effective Date to OSKK by SCI.

      (g) No Violation, Litigation or Regulatory Action.

      (a) The Purchased Assets, the Purchased IT Assets, the assets subject to
the Leases and Licenses and their uses in the business currently conducted by
SCI as presently conducted comply in all material respects with all Applicable
Laws and Governmental Orders, (b) SCI has complied in all material respects with
all Applicable Laws and Governmental Orders which are applicable to the
Purchased Assets, the Purchased IT Assets, the assets subject to the Leases and
Licenses or the business currently conducted by SCI, (c) there are no lawsuits,
claims, suits, proceedings or investigations pending or threatened against or
affecting SCI in respect of the Purchased Assets, the Purchased IT Assets, the
assets subject to the Leases and Licenses or the business currently conducted by
SCI, and there are no lawsuits, suits or proceedings pending in which SCI is the
plaintiff or claimant and which relate to the Purchased Assets, the Purchased IT
Assets, the assets subject to the Leases and Licenses or the business currently
conducted by SCI; nor is there any basis for the
<PAGE>
                                      -21-

same, and (d) there is no action, suit or proceeding pending against SCI or
threatened which questions the legality of the transactions contemplated by this
Agreement.

      (h) Financial Data.

      SCI has provided to OSI and OSKK certain information regarding the
historical expenses and revenues of the business currently conducted by SCI. The
historical financial information, including balance sheets and profit and loss
statements, for the years ended March 31, 1999, 2000, 2001 provided to OSI and
OSKK have been prepared in accordance with SCI's own accounting policies and
practices consistently applied, and do not contain any inaccuracies or
misstatements or omit to state a material fact necessary to make the information
set forth not misleading.

      (i) [Intentionally Omitted]

      (j) Inventory.

      The Inventory has been stored and handled in a reasonable manner and in
accordance with any applicable manufacturer's guidelines. The Inventory which
shall be listed by SCI on the Closing Merchantable Inventory Schedule shall have
a book value determined in accordance with Article 3.2, none of the
Non-Consigned Inventory listed on the Closing Merchantable Inventory Schedule
shall be Excepted Inventories, and none of the Consigned Inventory listed on the
Closing Merchantable Inventory Schedule shall consist of Discontinued Products.

      (k) Disclosure.

      None of the representations or warranties of SCI contained herein, and
none of the information which SCI has disclosed to OSKK and/or OSI contains or
will contain any untrue statement of a material fact or omits or will omit to
state a material fact necessary to make the statements herein or therein not
misleading.

      (l) Accounts Receivable.

      The Accounts Receivable which shall be listed by SCI on the Closing
Accounts Receivable Schedule shall represent bona fide claims of SCI against
debtors for sales, services performed or other events arising on or before the
Closing Date, and all goods delivered and services performed which gave rise, or
will give rise prior to the Closing Date, to such Accounts Receivable were
delivered or performed, or shall be delivered or performed prior to the Closing
Date, in accordance with applicable orders, Contracts or customer requirements.
The Accounts Receivable which shall be listed on the Closing Accounts Receivable
Schedule (i) shall have a book value determined in accordance with Article 3.2
and (ii) shall not have been outstanding more than one hundred twenty-two (122)
days as of the Closing Date. Schedule 5.1(l) attached hereto reflects SCI's true
and accurate bad debt expense for accounts receivable and bills receivable
recorded by SCI for the past five (5) fiscal years.
<PAGE>
                                      -22-

      (m) Absence of Changes. Since December 31, 2001: (i) there has occurred no
Material Adverse Effect and no event or condition has occurred that could
reasonably be expected to result in a Material Adverse Effect, (ii) except as
expressly contemplated by this Agreement, there has not been any sale or other
disposition, except in the ordinary course of business, of any of the Purchased
Assets, or any Encumbrance placed on the Purchased Assets, and (iii) SCI has
operated its business in the ordinary course so as to preserve its business
intact, to keep available to its business the services of its employees, and to
preserve its business and the goodwill of SCI's suppliers, customers,
distributors and others having business relations with SCI.

      (n) Permits.

      Schedule 5.1(n) sets forth a complete list of all Permits used in and
necessary for the operation of SCI's business, all of which are as of the
Effective Date, and all of which will be as of the Closing Date, in full force
and effect.

      (o) Leased Premises.

      The Leased Premises set forth on Exhibit A constitute all of the real
property and facilities used by SCI in the conduct of its business as presently
conducted.

      (p)  No Brokers.

      None of SCI, its Affiliates or any officers, directors, employees, agents
or other representatives of SCI and its Affiliates has entered into or will
enter into any contract, agreement, arrangement or understanding with any
broker, finder, agent or other Person which will result in the obligation of
OSI, OSKK or any of their Affiliates to pay any finder's fee, brokerage fee or
commission or similar payment in connection with the transactions contemplated
by this Agreement..

      5.2   Representations and Warranties of SE, SECL and SC.

      As an inducement to OSI and OSKK to enter into this Agreement and to
consummate the transactions contemplated hereby, SE, SECL and SC hereby
represent and warrant to OSI and OSKK that the statements contained in this
Article 5.2 are correct and complete as of the Effective Date and will be
correct and complete as of the Closing Date and as of the Payment Date:

      (a) Organization.

      SE, SECL and SC are entities duly organized and validly existing under the
laws of Japan. Each of SE, SECL and SC has full corporate power and authority to
own or lease and to operate and use its properties and assets and to carry on
its business as now conducted.

      (b) Authorization.

            (i) Each of SE, SECL and SC has full power and authority to execute,
deliver and perform this Agreement and to consummate the transactions
contemplated hereby. This Agreement has been duly authorized, executed and
delivered by SE,
<PAGE>
                                      -23-

SECL and SC and constitutes, or upon execution and delivery by SE, SECL and SC
will constitute, as the case may be, legal, valid and binding obligations of SE,
SECL and SC enforceable against SE, SECL and SC in accordance with their terms.

            (ii) Neither the execution and delivery of this Agreement or the
consummation of any of the transactions contemplated hereby nor compliance with
or fulfillment of the terms, conditions and provisions hereof or thereof will:
(i) violate, conflict with, result in a breach of the terms, conditions or
provisions of, or constitute a default, an event of default or an event creating
rights of acceleration, termination or cancellation or a loss of rights under
(a) the organizational documents of SE, SECL and SC, (b) any other note,
instrument, agreement, mortgage, lease, license, franchise, permit or
authorization, right, restriction or obligation to which any of SE, SECL and/or
SC is a party or any of its properties is subject or by which any of SE, SECL
and/or SC or any of its properties is bound, (c) any Governmental Order to which
any of SE, SECL and/or SC is a party or any of its properties is subject or by
which any of SE, SECL and/or SC or any of its properties is bound, or (d) any
Applicable Laws affecting any of SE, SECL and/or SC or its property; or (ii)
require the approval, consent, authorization or act of, or the making by SE,
SECL and/or SC of any declaration, filing or registration with, any Person,
subject as to enforcement to applicable insolvency, bankruptcy, reorganization
and other such legal protections for debtors and to injunctive relief being
discretionary to any court.

      (c) No Proceedings.

      There is no action, suit or proceeding pending against SE, SECL and/or SC
or threatened that challenges, or may have the effect of preventing, delaying,
making illegal, or otherwise interfering with, any of the transactions
contemplated by this Agreement.

      (d) No Issued Patents or Pending Patent Applications.

      There are no issued patents or pending patent applications with respect to
SE's proprietary ink-jet printing technology for laying colored ink on
disposable contact lenses. Furthermore, there is no collaboration with any third
party to develop or commercialize SE's proprietary ink-jet printing technology
for laying colored ink on disposable contact lenses.

                                    ARTICLE 6

                 REPRESENTATIONS AND WARRANTIES OF OSKK AND OSI

      6.1   Representations and Warranties of OSKK and OSI.

      As an inducement to SE, SC and SCI to enter into this Agreement and to
consummate the transactions contemplated hereby, OSKK and OSI hereby represent
and warrant to SE, SC, SECL and SCI that the statements contained in this
Article 6.1
<PAGE>
                                      -24-

are correct and complete as of the Effective Date and will be correct and
complete as of the Closing Date and as of the Payment Date:

      (a) Organization.

      OSKK is an entity duly organized and validly existing under the laws of
Japan. OSI is an entity duly organized and validly existing under the laws of
the State of Delaware, the United States. Each of OSKK and OSI has full
corporate power and authority to own and use its properties and assets and to
carry on its business as now conducted. Sidecastle, Ltd., a limited liability
company existing by virtue of the laws of the Republic of Ireland
("Sidecastle"), is the majority shareholder of all issued and outstanding shares
of OSKK.

      (b) Authorization.

            (i) OSKK and OSI have full power and authority to execute, deliver
and perform this Agreement and to consummate the transactions contemplated
hereby. This Agreement has been duly authorized, executed and delivered by OSKK
and OSI and constitutes, or upon execution and delivery by OSKK and OSI will
constitute, as the case may be, legal, valid and binding obligations of OSKK and
OSI enforceable against OSKK and OSI in accordance with their terms, subject as
to enforcement to applicable insolvency, bankruptcy, reorganization and other
such legal protections for debtors and to injunctive relief being discretionary
to any court.

            (ii) Neither the execution and delivery of this Agreement or the
consummation of any of the transactions contemplated hereby nor compliance with
or fulfillment of the terms, conditions and provisions hereof or thereof will:
(i) violate, conflict with, result in a breach of the terms, conditions or
provisions of, or constitute a default, an event of default or an event creating
rights of acceleration, termination or cancellation or a loss of rights under
(a) the organizational documents of OSKK, Sidecastle and OSI, (b) any other
note, instrument, agreement, mortgage, lease, license, franchise, permit or
authorization, right, restriction or obligation to which OSKK, Sidecastle and/or
OSI is a party or any of their properties is subject or by which OSKK,
Sidecastle and/or OSI or any of their properties is bound, (c) any Governmental
Order to which OSKK, Sidecastle and/or OSI is a party or any of their properties
is subject or by which OSKK, Sidecastle and/or OSI or any of their properties is
bound, or (d) any Applicable Laws affecting OSKK, Sidecastle and/or OSI or their
property; or (ii) require the approval, consent, authorization or act of, or the
making by OSKK, Sidecastle and/or OSI of any declaration, filing or registration
with, any Person, subject as to enforcement to applicable insolvency,
bankruptcy, reorganization and other such legal protections for debtors and to
injunctive relief being discretionary to any court.

      (c) No Proceedings.

      There is no action, suit or proceeding pending against OSKK, OSI and/or
Sidecastle or threatened that challenges, or may have the effect of preventing,
delaying, making illegal, or otherwise interfering with, any of the transactions
contemplated by this Agreement.

      (d)  No Brokers.
<PAGE>
                                      -25-

      None of OSI, OSKK, their Affiliates or any officers, directors, employees,
agents or other representatives of OSI, OSKK and their Affiliates has entered
into or will enter into any contract, agreement, arrangement or understanding
with any broker, finder, agent or other Person which will result in the
obligation of SCI, SE, SECL or SC or any of their Affiliates to pay any finder's
fee, brokerage fee or commission or similar payment in connection with the
transactions contemplated by this Agreement.

                                    ARTICLE 7

                ACTION PRIOR TO THE COMPLETION OF THE TRANSACTION

      The respective parties hereto covenant and agree to take the following
actions prior to the completion of the transaction contemplated hereby.

      7.1   Investigation of the Business by OSI and OSKK.

      Prior to the Payment Date, upon reasonable advance notice by OSI or OSKK
to SCI, SCI shall afford to the officers, employees and authorized
representatives of OSI and OSKK (including, without limitation, independent
public accountants and attorneys) reasonable access during normal business hours
to the offices, properties, employees and business and financial records
(including computer files, retrieval programs and similar documentation) of SCI
and shall furnish to OSI or OSKK or its authorized representatives such
additional information as shall be reasonably requested, including all such
information as shall be reasonably necessary to enable OSI or OSKK or its
representatives to verify the accuracy of the representations and warranties
contained in this Agreement, to verify that the covenants of SCI contained in
this Agreement have been complied with and to determine whether the conditions
set forth in Article 9 have been satisfied.

      7.2   Preserve Accuracy of Representations and Warranties.

      Each of the parties hereto shall refrain from taking any action which
would render any representation or warranty contained in Article 5 or 6 of this
Agreement not to be true and correct in all material respects as of the Closing
Date and the Payment Date. Each party shall promptly notify the other of any
action, suit or proceeding that shall be instituted or threatened against such
party to restrain, prohibit or otherwise challenge the legality of any
transaction contemplated by this Agreement.

      7.3   Notice of Certain Matters.

      Without limiting either party's right to rely on the representations and
warranties as set forth herein, each of the parties hereto shall provide the
other parties
<PAGE>
                                      -26-

with prompt written notice with respect to any material facts of which they
become aware which arise between the Effective Date and the Payment Date which,
if they had occurred and been known prior to the Effective Date, would have been
required to have been disclosed in order to make the representations and
warranties contained in Articles 5 and 6 true and correct as of the Effective
Date. In addition, SCI shall provide OSKK with prompt written notice if between
the Effective Date and the Payment Date, there is a change in the Purchased
Assets, the Purchased IT Assets, the assets subject to the Leases and Licenses
or its business which has or may be reasonably expected to have a Material
Adverse Effect. Subject to the applicable confidentiality provisions of this
Agreement, during the period prior to the Payment Date, SCI will as promptly as
reasonably possible under the circumstances advise OSKK in writing of (a) any
notice or other communication from any third Person alleging that the consent of
such third Person is or may be required in connection with the transactions
contemplated by this Agreement, and (b) any material default under any
agreements, contracts or licenses, permits, approvals or other authorizations
from a Governmental Body or event which, with notice or lapse of time or both,
would become such a default on or prior to the Payment Date.

      7.4   Business Prior to the Closing Date.

      (a) Except as expressly contemplated by this Agreement, until the Closing
Date: (i) SCI shall operate and carry on its business only in the ordinary
course and substantially as presently operated, and in compliance with all
Applicable Laws, Governmental Orders, and the binding agreements, covenants and
restrictions applicable thereto; (ii) SCI shall keep and maintain the Purchased
Assets, the Purchased IT Assets, and the assets subject to the Leases and
Licenses in reasonably good operating condition and repair and, except to the
extent specifically agreed to in writing by OSKK, shall use its best efforts to
maintain the business organization of its business intact and to preserve the
goodwill of the suppliers, contractors, employees, customers and other Persons
having business relations with SCI, (iii) SCI shall not (a) transfer or cause to
be transferred from or to SCI any Employee without the knowledge of OSKK or (b)
otherwise attempt to persuade any Employee to terminate his or her relationship
with the business currently conducted by SCI, and (iv) SCI shall not sell or
otherwise transfer or subject to any Encumbrance any of the assets owned by SCI
as of the Record Date and listed on Schedule 2.1(a)(i) hereto.

      (b) In furtherance of the foregoing subsection, and without limitation
thereof, except as expressly contemplated by this Agreement or except with the
express written approval of OSKK, until the Closing Date SCI shall (i) use the
Purchased Assets and the Purchased IT Assets, and the assets subject to the
Leases and Licenses in the usual, regular and ordinary course and in
substantially the same manner as heretofore used, (ii) continue to make payments
when due and not slow down those payments as compared to its normal payment
procedures and to perform its obligations under the leases, contracts,
commitments and other agreements, (iii) not sell, dispose of, encumber or enter
into any agreement for the sale, disposition or Encumbrance of, all or any part
of the Purchased Assets, the Purchased IT Assets or the assets subject to the
Leases and Licenses, except for the sale of Inventories in the ordinary course
of business consistent with past practice and the purchase of the Purchased IT
Assets in accordance with Article 2.3(a), (iv) with respect to any
<PAGE>
                                      -27-

Employee, not enter into any employment contract or, except in the ordinary
course of business, increase any such Employee's compensation or benefits
without the consent of OSKK, and (v) not enter into any contracts or commitments
with respect to the business currently conducted by SCI not in the ordinary
course of business or involving receipt or payment of more than two hundred
thousand (200,000) yen.

      7.5   Transferred Warranties.

      SCI shall use its best efforts prior to the Closing Date to transfer to
OSKK on the Closing Date: (i) any applicable manufacturer's warranties with
respect to the Purchased Assets, and (ii) any applicable manufacturer's and/or
third party licensor's warranties with respect to the Purchased IT Assets.

      7.6 Court-Appointed Examination.

      OSKK shall use its best efforts to apply for the examination by the
relevant court-appointed examiner pursuant to Article 246 of the Commercial Code
of Japan (Law No. 48 of 1899) (jigo-setsuritsu) as soon as practicable after the
Effective Date.

                                    ARTICLE 8

                   SUBSIDY, EXCHANGE RATE AND UNDELIVERED ORDERS

      8.1   Subsidy.

      OSI and OSKK agree that upon and subject to the consummation of the
transactions contemplated herein on the Closing Date, SCI and its Affiliates
shall be relieved from all obligations outstanding on the Closing Date under the
Disposable Distribution Agreement between OSI and SCI, dated as of November 7,
1996 (the "Disposable Distribution Agreement") to pay the difference between (i)
the Projected Quarterly Cost of Goods Sold and (ii) the actual OSI Cost of
Production plus OSI Other Expenses (each as defined in the Disposable
Distribution Agreement), for supply of product by OSI and its Affiliates to SCI
and its Affiliates prior to the Closing Date. Notwithstanding the foregoing, SCI
and its Affiliates shall not be relieved of any obligations to pay OSI's
allocation of Gross Profit (as defined in the Disposable Distribution Agreement)
for product supplied by OSI and its Affiliates to SCI and its Affiliates
pursuant to the Disposable Distribution Agreement.

      8.2   Exchange Rate.

      Tokyo Mitsubishi Bank's TTM (Telegraphic Transfer Mean) exchange rate
between Japanese Yen and United States Dollars shall be applicable to any and
all payments due or amount offset under this Agreement. Such TTM exchange rate
shall be determined as of the seventh (7th) business day before each and every
payment made or amount offset is applied.
<PAGE>
                                      -28-

      8.3   Undelivered Orders.

      During the period between the Effective Date and the Closing Date, SCI
will not enter into any commitments or agreements to purchase supplies
("Post-Effective Date Supply Orders"), unless SCI has first (i) provided OSKK
and OSI a copy of the unexecuted Post-Effective Date Supply Order, including,
the name of the counter-party, price terms and quantity, and (ii) received
OSKK's and OSI's written approval to SCI's entry into the Post-Effective Date
Supply Order. With respect to Post-Effective Date Supply Orders and supply
orders entered into prior to the Effective Date by SCI that are undelivered to
SCI as of the Closing Date and which have been approved by OSKK and OSI in
writing ("Undelivered Orders"), on the Closing Date, SCI will assign the
Undelivered Orders to OSKK and OSKK will assume SCI's obligations under the
Undelivered Orders. OSKK will not assume any obligations under any supply orders
not approved in writing by OSKK.

                                    ARTICLE 9

               CONDITIONS PRECEDENT TO OBLIGATIONS OF OSI AND OSKK

      The obligations of OSKK to consummate the transactions provided for in
this Agreement shall be subject, at the option of OSI and OSKK, to the
satisfaction on or prior to the Closing Date, of the following conditions.

      9.1   No Misrepresentation or Breach of Covenants and Warranties.

      Each of the representations and warranties of SCI, SE, SECL and SC
contained or referred to herein that are qualified by materiality or Material
Adverse Effect shall have been true and correct when made and shall be true and
correct on the Closing Date (except that those representations and warranties
that address matters only as of a particular date need only be true and correct
as of such date), and each of the representations and warranties of SCI, SE,
SECL and SC that are not so qualified shall have been true and correct in all
material respects when made and shall be true and correct in all material
respects on the Closing Date; SCI, SE, SECL and SC shall have complied with and
not otherwise breached the covenants set forth herein; and SCI, SE, SECL and SC
shall have delivered to OSKK and OSI such certificates of their officers to
evidence compliance with the conditions set forth in this Article 9.1 as may be
reasonably requested by OSKK and OSI.
<PAGE>
                                      -29-

      9.2   No Restraint or Litigation.

      No action, suit, investigation or proceeding shall have been instituted or
overtly threatened to restrain or prohibit or otherwise challenge the legality
or validity of the transactions contemplated hereby.

      9.3   Necessary Approvals.

      The parties shall have received the approvals and consents of all Persons
necessary to consummate the transactions contemplated hereby.

      9.4   Employees.

      85% or more of the Key People identified by OSKK on Schedule 2.2(c) and
75% or more of the Employees on Schedule 2.2(a) shall have accepted offers of
employment by OSKK.

      9.5   No Material Adverse Change.

      There shall have been no change or changes with respect to the Purchased
Assets, the Purchased IT Assets, the assets subject to the Leases and Licenses
or the business currently conducted by SCI having a Material Adverse Effect.

      9.6   Contract with Chart K.K..

      On or prior to the Closing Date, OSKK shall have entered into a
distribution service agreement with Chart K.K. in substantially the form
attached hereto as Schedule 2.4(a).

      9.7   Contract with SE.

      On or prior to the Closing Date, OSKK and SE shall have entered into an
agreement in a form listed in Schedule 2.8(b).

      9.8   Purchased IT Assets and Leases and Licenses.

      On or prior to the Closing Date, (i) SCI shall have acquired the Purchased
IT Assets from Century Leasing Company and shall be prepared to transfer to OSKK
the Purchased IT Assets on the Closing Date and (ii) OSKK shall have entered
into lease or license agreements for all of the assets subject to the Leases and
Licenses on terms and conditions reasonably satisfactory to OSKK, other than
those assets subject to the Leases and Licenses set forth on Schedule 9.8
attached hereto ("Non-Essential Leases and Licenses"), or the lessors or
licensors of the Leases and Licenses, other than the lessors and licensors of
the Non-Essential Leases and Licenses, shall have consented to the transfer of
the Leases and Licenses to OSKK.
<PAGE>
                                      -30-

      9.9 Contract with regard to the Leased Premises.

      On or prior to the Closing Date, OSKK and the owners of the Leased
Premises shall have entered into lease agreements for the Leased Premises on
terms substantially in accordance with the terms set forth in the memoranda of
understanding attached hereto as Schedule 9.9.

      9.10  License Agreements with SC.

      On or prior to the Closing Date, OSKK and SC shall have entered into the
license agreement in a form listed in Schedule 2.10(b) and SCI shall have
assigned the fully-paid Cielo Trademark License Agreement to OSKK and SC shall
have consented to the assignment.

      9.11  Permits.

      OSKK shall have obtained all Permits necessary or used in the operation of
SCI's business as currently conducted, other than the importation licenses
identified in Article 2.6(a)(1) and (2) and licenses related to drug sales.

                                   ARTICLE 10

           CONDITIONS PRECEDENT TO OBLIGATIONS OF SCI, SE, SECL AND SC

      The obligations of SCI, SE, SECL and SC to consummate the transactions
provided for in this Agreement shall be subject, at the option of SCI, SE, SECL
and SC to the satisfaction on or prior to the Closing Date, of the following
conditions:

      10.1  No Misrepresentation or Breach of Covenants and Warranties.

      Each of the representations and warranties of OSKK and OSI contained or
referred to herein that are qualified by materiality shall have been true and
correct when made and shall be true and correct on the Closing Date (except that
those representations and warranties that address matters only as of a
particular date need only be true and correct as of such date), and each of the
representations and warranties of OSKK and OSI that are not so qualified shall
have been true and correct in all material respects when made and shall be true
and correct in all material respects on the Closing Date; OSKK and OSI shall
have complied with and not otherwise breached the covenants set forth herein;
and OSKK and OSI shall have delivered to SCI, SE, SECL and SC such certificates
of their officers to evidence compliance with the conditions set forth in this
Article 10.1 as may be reasonably requested by SE, SECL and SC.
<PAGE>
                                      -31-

      10.2  No Restraint or Litigation.

      No action, suit, investigation or proceeding shall have been instituted or
overtly threatened to restrain, prohibit or otherwise challenge the legality or
validity of the transactions contemplated hereby.

                                   ARTICLE 11

                                 INDEMNIFICATION

      11.1  Indemnification by SCI.

      SCI agrees to indemnify and hold harmless (collectively,
"indemnification") each OSI Group Member from and against any and all Losses and
reasonable Expenses incurred by such OSI Group Member in connection with or
arising from:

            (a) any breach by SCI of any of its covenants in this Agreement;

            (b) any breach of any warranty or the inaccuracy of any
representation of SCI contained or referred to in this Agreement or any
certificate of title delivered by or on behalf of SCI pursuant hereto; and

            (c) the Excluded Liabilities.

      The indemnification provided for in Article 11.1 shall survive termination
or expiration of this Agreement.

      11.2  Indemnification by SE, SECL and SC.

      SE, SECL and SC agree to indemnify and hold harmless (collectively,
"indemnification") each OSI Group Member from and against any and all Losses and
reasonable Expenses incurred by such OSI Group Member in connection with or
arising from:

            (a) any breach by SE, SECL and/or SC of any of their covenants in
this Agreement;

            (b) any breach of any warranty or the inaccuracy of any
representation of SE, SECL and/or SC contained or referred to in this Agreement
or any certificate of title delivered by or on behalf of SE, SECL and/or SC
pursuant hereto; and

            (c) the Excluded Liabilities.

      The indemnification provided for in Article 11.2 shall survive termination
or expiration of this Agreement.
<PAGE>
                                      -32-

      11.3  Indemnification by OSKK and OSI.

      OSKK and OSI agree to indemnify and hold harmless (collectively,
"indemnification") each SCI Group Member from and against any and all Losses and
reasonable Expenses incurred by such SCI Group Member in connection with or
arising from:

            (a) any breach by OSKK and/or OSI of any of their covenants in this
Agreement;

            (b) any breach of any warranty or the inaccuracy of any
representation of OSKK, Sidecastle and/or OSI contained or referred to in this
Agreement or any certificate delivered by or on behalf of OSKK and/or OSI
pursuant hereto, and

            (c) OSI's transfer of SCI's accounts payable to OSKK.

      The indemnification provided for in Article 11.3 shall survive termination
or expiration of this Agreement.

      11.4  NO CONSEQUENTIAL OR PUNITIVE DAMAGES.

      In no event shall any Party be liable to any other, whether arising under
contract, tort (including negligence), strict liability or otherwise, for loss
of anticipated profits or consequential loss or consequential damage of any
nature, nor exemplary or punitive damages, arising at any time from any cause
whatsoever, incurred or claimed to have been incurred by THE other Party. This
Article 11.4 shall apply notwithstanding any other provision of this Agreement
and shall survive the termination or expiration of this Agreement.

                                   ARTICLE 12

                                   TERMINATION

      12.1  Termination.

      Notwithstanding anything in this Agreement to the contrary, this Agreement
may be terminated:

            (a) by the mutual consent of all of the parties;

            (b) by OSI Group Members in the event of any material breach by any
SCI Group Members of any of the representations, warranties, covenants or
agreements of any SCI Group Members contained herein and the failure of any SCI
<PAGE>
                                      -33-

Group Members to cure such breach within fifteen (15) days after receipt of
notice from OSI Group Members requesting such breach to be cured;

            (c) by SCI Group Members in the event of any material breach by any
OSI Group Members of any of any OSI Group Members' representations, warranties,
covenants or agreements contained herein and the failure of any OSI Group
Members to cure such breach within fifteen (15) days after receipt of notice
from any SCI Group Members requesting such breach to be cured; or

            (d) by any party hereto in the event that any other party to this
Agreement suspends payments (shiharai-teishi), becomes unable to make payments
(shiharai-funou), is subject to disposition due to delinquency in payment of
taxes and public imposts, is subject to provisional attachment or disposition
(kari-sashiosae/kari-shobun), is ordered to suspend transactions with banks and
financial institutions, a note or check drawn by such party is dishonored
(fuwatari), is filed for compulsory execution (kyousei-shikkou), public auction,
bankruptcy, corporate reorganization procedure, civil rehabilitation procedure
or other similar proceeding, or its dissolution is resolved.

      12.2  Notice of Termination.

      Any party desiring to terminate this Agreement pursuant to Article 12.1
above shall give written notice of such termination to the other party to this
Agreement.

      12.3  Effect of Termination.

      In the event that this Agreement shall be terminated pursuant to this
Article 12, all further obligations and liabilities of the parties under this
Agreement (other than Articles 14.2, 14.13 and 14.14) shall be terminated,
except for liabilities resulting from the willful breach of this Agreement
occurring prior to the proper termination of this Agreement..

                                   ARTICLE 13

                                   GUARANTEES

      13.1  SE's Guarantee.

      SE hereby guarantees SCI's performance of the obligations under this
Agreement. Even in the case where SCI is dissolved in the future, SE shall
perform SCI's obligations under this Agreement.

      13.2  OSI's Guarantee.

      OSI hereby guarantees OSKK's performance of the obligations under this
<PAGE>
                                      -34-

Agreement. Even in the case where OSKK is dissolved in the future, OSI shall
perform OSKK's obligations under this Agreement.

                                   ARTICLE 14

                               GENERAL PROVISIONS

      14.1  Survival of Obligations.

      All representations, warranties, covenants and obligations contained in
this Agreement shall survive the consummation of the transactions contemplated
by this Agreement; provided that all remedies and claims in connection with
breaches of this Agreement shall be subject to Article 11 and the limitations
contained therein. The respective representations and warranties of each party
hereto contained herein shall not be deemed waived or otherwise affected by any
investigation made by the other party hereto and shall survive the Payment Date.

      14.2  No Public Announcements.

      Except as heretofore made, neither SCI, SE, SECL, SC, OSI nor OSKK shall,
without the approval of the others, make any press release or other public
announcement concerning this Agreement, its existence or the transactions
contemplated by this Agreement, except as and to the extent that any such party
shall be so obligated by law, in which case the other party shall be advised and
the parties shall use their reasonable efforts to cause a mutually agreeable
release or announcement to be issued.

      14.3  Notices.

      All notices, requests, instructions or other communications or other
documents required or permitted hereunder shall be in writing and shall be
deemed given or delivered when delivered personally via telecopier or five (5)
days after being sent, when sent by registered or certified mail, or one (1) day
after being sent, when sent by overnight courier, addressed as follows:

            If to OSI, to:

            1855 Gateway Boulevard, Suite 700, Concord, CA 94520 USA

            Attn.: Steve Fanning, President & CEO

            If to OSKK, to:
<PAGE>
                                      -35-

            28-11, Taito 4-chome, Taito-ku, Tokyo 110-0016 Japan
            Attn.: Masakazu Niwa, President

            If to SCI, SE, SECL or SC to:

            Seiko Epson Corporation

            8793 Nakaminowa, Minowa-machi, Kimiina-gun, Nagano-ken
            399-4693 Japan

            Attn.: Osamu Kamiwaki, Corporate General Manager

      or to such other address as such party may indicate by a notice delivered
to the other parties hereto.

      14.4  Successors and Assigns.

            (a) This Agreement and the rights of either party under this
Agreement shall not be assignable without the prior written consent of the other
party hereto.

            (b) This Agreement shall be binding upon and inure to the benefit of
the parties hereto and their successors and permitted assigns. Nothing in this
Agreement, expressed or implied, is intended or shall be construed to confer
upon any Person other than the parties and successors and assigns permitted by
this Article 14.4 any right, remedy or claim under or by reason of this
Agreement.

      14.5  Access to Records After Closing Date.

      For a period of three (3) years after the Closing Date, OSKK and its
representatives shall have reasonable access to all of the books and records of
SCI's business which SCI or any of its Affiliates have retained after the
Closing Date. Such access shall be afforded upon receipt of reasonable advance
notice and during normal business hours.

      14.6  Entire Agreement; Amendments.

      (a) This Agreement and the exhibits and schedules referred to herein and
the documents delivered pursuant hereto (including the Shukko Agreement in
relation to Mr. Okazaki) contain the entire understanding of the parties hereto
with regard to the subject matter contained herein or therein, and supersede all
prior agreements or understanding between or among any of the parties hereto.
<PAGE>
                                      -36-

      (b) The Non-Disclosure Agreements between SE, SECL, SCI and OSI dated
October 19, 1995 and May 20, 1999 are hereby terminated (subject to the survival
of those rights and obligations respectively therein in accordance with their
respective terms). The Letter of Intent between the parties dated March 16, 2001
(including Article 7 thereof) is hereby terminated. The Letter of Intent between
the parties dated September 25, 2001 is hereby terminated.

      (c) Termination of the Disposable and Daily Wear Distribution Agreements
between OSI and SCI dated November 7, 1996 (subject to the survival of those
rights and obligations respectively therein in accordance with their respective
terms) shall become effective as upon OSKK having obtained, under its name, the
license for importation and sales of medical devices for the products that SCI
currently imports and distributes in Japan and having transferred to it the
authorizations for the importation of such products. The Clinical Investigation
Agreements, mentioned in Article 17(f) and Article 15(f) of such Disposable and
Daily Wear Distribution Agreements, respectively, shall terminate in accordance
with those articles.

      (d) This Agreement shall not be amended, modified or supplemented except
by a written instrument signed by an authorized representative of each of the
parties hereto.

      14.7  Interpretation.

      Article titles and headings to sections herein are inserted for
convenience of reference only and are not intended to be a part of or to affect
the meaning or interpretation of this Agreement. The schedules referred to
herein shall be construed with and as an integral part of this Agreement to the
same extent as if they were set forth verbatim herein.

      14.8  Waivers.

      Any term or provision of this Agreement may be waived, or the time for its
performance may be extended, by the party or parties entitled to the benefit
thereof. Any such waiver shall be validly and sufficiently authorized for the
purposes of this Agreement if, as to any party, it is authorized in writing by
an authorized representative of such party. The failure of any party hereto to
enforce at any time any provision of this Agreement shall not be construed to be
a waiver of such provision, nor in any way to affect the validity of this
Agreement or any part hereof or the right of any party thereafter to enforce
each and every such provision. No waiver of any breach of this Agreement shall
be held to constitute a waiver of any other or subsequent breach.

      14.9  Expenses.

      Except as otherwise expressly agreed to in writing by the parties, each
party hereto will pay all Expenses incident to its negotiation and preparation
of this
<PAGE>
                                      -37-

Agreement and to its performance and compliance with all agreements and
conditions contained herein on its part to be performed or complied with.

      14.10 Partial Invalidity.

      Wherever possible, each provision hereof shall be interpreted in such
manner as to be effective and valid under Applicable Laws, but in case any one
or more of the provisions contained herein shall be held to be invalid, illegal
or unenforceable in any respect, such provision shall be ineffective to the
extent, but only to the extent, of such invalidity, illegality or
unenforceability without invalidating the remainder of such invalid, illegal or
unenforceable provision or provisions or any other provisions hereof, unless
such a construction would be unreasonable.

      14.11 Execution in Counterparts.

      This Agreement may be executed in one or more counterparts, each of which
shall be considered an original instrument, but all of which shall be considered
one and the same agreement, and shall become binding when one or more
counterparts have been signed by each of the parties hereto and delivered to
each of SCI and OSKK. A facsimile copy of a signature shall have the same effect
as an original signature.

      14.12 Further Assurances.

            (a) On the Closing Date SCI shall (i) deliver to OSKK such other
bills of sale, deeds, endorsements, assignments and other good and sufficient
instruments of conveyance and transfer, in a form reasonably satisfactory to
OSKK and its counsel, as OSKK may reasonably request or as may be otherwise
reasonably necessary to vest in OSKK all the rights, title and interest of SCI
in, to or under any or all of the Purchased Assets and Purchased IT Assets
(subject to Article 2.3)), and (ii) take all steps as may be reasonably
necessary to put OSKK in actual possession and control of all the Purchased
Assets and Purchased IT Assets (subject to Article 2.3).

            (b) OSKK and SCI hereby agree that, from time to time following the
Closing Date, in addition to those documents and actions specified herein, and
without the receipt of further consideration, they will execute and deliver such
documents and take such actions as the other party may reasonably request in
such form as may be appropriate, if necessary or advisable in connection with
the consummation of the transactions contemplated hereby or of any other
agreement delivered in connection herewith, including, without limitation, the
transfer of the Purchased Assets and Purchased IT Assets.

      14.13 Confidentiality.

            (a) OSI and OSKK agree to hold in strict confidence all proprietary
information and documents received from SE and SCI concerning the Purchased
Assets, Purchased IT Assets and the business currently conducted by SCI (except
for
<PAGE>
                                      -38-

those OSKK purchased), and OSI and OSKK will not use any such information and
documents for any purpose other than in connection with the transactions
contemplated hereby; provided, however, that the foregoing limitations shall
cease to be effective on the Closing Date, subject to any third party
confidentiality obligations. If the transactions herein contemplated are not
consummated, OSI and OSKK will continue to hold such information and documents
in strict confidence and, upon receipt of notice requesting such action, will
return to SE and SCI all such documents without retaining copies thereof;
provided, however, that the obligation of OSI and OSKK to maintain such
confidentiality shall not apply to any information or documents (i) that are
required by Applicable Laws or the terms of this Agreement to be disclosed, or
(ii) that are in the public domain at the time furnished, or that become in the
public domain thereafter through any means other than as a result of any act of
OSI or OSKK which constitutes a breach of this Agreement.

            (b) Beginning as of the Closing Date, SE and SCI agree to hold in
strict confidence all proprietary information provided by OSI and OSKK under the
terms of this Agreement and will not use such information except in furtherance
of its continuing business relationships with OSI and OSKK. If the transactions
herein contemplated are not consummated, SE and SCI will continue to hold such
information in strict confidence; provided, however, that the obligations of SE
and SCI hereunder shall not apply to any information or documents (i) that are
required by Applicable Laws or the terms of this Agreement to be disclosed, or
(ii) that are in the public domain at the time furnished, or that become in the
public domain thereafter through any means other than as a result of any act of
SE or SCI which constitutes a breach of this Agreement.

      14.14 Governing Law.

      This Agreement shall be interpreted in English and shall be governed by
and construed in accordance with the laws of Japan (without giving effect to its
conflicts of laws provisions).

      14.15 Dispute Resolution.

      Any dispute or claim arising out of or relating to this Agreement, or
breach hereof shall be brought to the Tokyo District Court.

      14.16 Force Majeure.

      No delay or non-performance by either party hereto of any obligation under
this Agreement (except the obligation to pay money) caused by the occurrence of
any of the following events shall constitute a default or breach under this
Agreement or give rise to any claim for damages or indemnification: earthquake,
typhoon, tidal wave, hurricane, storm, lightning, or other natural or physical
disasters, epidemics, plagues, confiscation, nationalization, war, rebellion,
hostilities, terrorist acts, strikes, labor shortages, or any other event beyond
the reasonable control of each party, as the case may be.
<PAGE>
                                      -39-

      14.17 Schedules and Exhibits.

      All schedules and exhibits referenced in this Agreement shall be in
Japanese, except for Schedules 2.2(c), 2.5(c), 4.1(a), 5.1(c), 5.1(d)(iii),
5.1(l) and 9.8, and Exhibit C, which shall be in English.
<PAGE>
                                      -40-

      IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed on the date first above written.

                                          OSKK

                                          By: /s/ Masakazu Niwa
                                              ---------------------------------
                                           Name:     Masakazu Niwa
                                                -------------------------------
                                          Title:             President
                                                -------------------------------

                                          OSI

                                          By: /s/ Steve Fanning
                                              ---------------------------------
                                          Name:     Steve Fanning
                                                -------------------------------
                                          Title:       President & CEO
                                                -------------------------------

                                          SCI

                                          By: /s/ Shoichi Kitagawa
                                              ---------------------------------
                                          Name:       Shoichi Kitagawa
                                                -------------------------------
                                          Title:               President
                                                -------------------------------

                                          SE

                                          By: /s/ Osamu Kamiwaki
                                              ---------------------------------
                                          Name:          Osamu Kamiwaki
                                                -------------------------------

                                          Title:   Corporate General Manager
                                                -------------------------------

MANAGER
                                          SECL

                                          By: /s/ Toshio Imai
                                              ---------------------------------
                                          Name:         Toshio Imai
                                                -------------------------------
                                          Title:                President
                                                -------------------------------

                                          SC

                                          By: /s/ Kunio Maeda
                                              ---------------------------------
                                          Name:     Kunio Maeda
                                                -------------------------------
<PAGE>
                                      -41-

                                          Title:    Executive Director
                                                -------------------------------
<PAGE>
                                  Schedule 1.1
                                   DEFINITIONS

      "Accounts Receivable" has the meaning specified in Article 2.1(a)(ii)
hereof.

      "Affiliate" means any entity that controls, is controlled by, or is under
common control with, each party, as the case may be. An entity shall be deemed
to be in control of another entity only if, and for so long as, it owns or
controls more than fifty percent (50%) of the shares of the subject entity
entitled to vote in the election of directors (or, in the case of an entity that
is not a corporation, for the election of the corresponding managing authority).

      "Applicable Laws" means any applicable federal, state and local laws,
statutes, regulations, rules, codes, ordinances, judgments, guidelines,
injunctions, decrees, orders, permits, approvals, and treaties, enacted,
adopted, issued or promulgated by any Governmental Body on or prior to the
Payment Date.

       "Chart K.K." means Chart K.K. having its registered office at 8-3
Tomigaya 1-Chome, Shibuya-ku, Tokyo, Japan.

      "Cielo Trademark License Agreement" means the Trademark License Agreement
between SC and SCI dated as of May 12, 1998.

      "Clinical and Analytical Evaluation Services Agreement" has the meaning
specified in Article 2.12(a) hereof.

      "Clinical and Analytical Instruments" means clinical and analytical
instruments owned by SE for examining and evaluating imported products for
compliance with the Pharmaceutical Affairs Law of Japan, a list of which is set
forth on Schedule 2.12(b).

      "Closing Accounts Receivable Schedule" has the meaning specified in
Article 3.2(a) hereof.

      "Closing Asset Schedules" has the meaning specified in Article 3.2(a)
hereof.

      "Closing Date" means April 1, 2002 (or such other time and date as the
parties shall agree in writing), or if the conditions set forth in Articles 9
and 10 shall have not been satisfied or waived by such date (except for
conditions set forth in Articles 9 and 10 which by their terms are to be
completed on the Closing Date), as soon as practicable (but in no event more
than 10 business days) after such conditions shall have been satisfied or waived
by such date.

      "Closing Excepted Inventory Schedule" has the meaning specified in Article
3.2(a) hereof.

      "Closing Merchantable Inventory Schedule" has the meaning specified in
Article 3.2(a) hereof.
<PAGE>
      "Consigned Inventory" means the Inventory to which SCI owns the ownership,
but which SCI has its retailers or distributors possess and manage for the
benefit of SCI.

      "Contracts" has the meaning specified in Article 5.1(f) hereof.

      "Counter-parties" has the meaning specified in Article 2.5(c) hereof.

      "Discontinued Products" means the products set forth on Exhibit C hereto.

      "Disposable Distribution Agreement" has the meaning specified in Article
8.1 hereof.

      "Effective Date" means the date of this Agreement first written above.

      "Encumbrance" means any lien, claim, charge, security interest, mortgage,
pledge, easement, conditional sale or other title retention agreement, defect in
title, covenant or other restrictions of any kind.

      "Environmental Law" shall mean all laws which regulate or relate to the
protection or clean-up of the environment, the use, treatment, storage,
transportation, generation, manufacture, processing, distribution, handling or
disposal of, or emission, discharge or other release or threatened release of,
Substances or otherwise dangerous substances, wastes, pollution or materials
(whether gas, liquid or solid), the preservation or protection of waterways,
groundwater, drinking water, air, wildlife, plants or other natural resources,
or the health and safety of persons or property, including protection of the
health and safety of employees.

      "Excepted Inventory" means Non-Consigned Inventory (i) which is damaged,
defective, opened, improperly labeled or otherwise not in resalable condition or
which are not legally approved for sale in Japan, (ii) which has an expiration
date of shorter than six (6) months from the Closing Date, (iii) which is in
excess of two (2) years' supply computed from calendar year 2001 net shipments,
(iv) which is part of a rejected lot or (v) which consists of Discontinued
Products.

      "Excluded Liabilities" means all Losses and Expenses of SCI, whether
liquidated or unliquidated, or known or unknown, whether arising out of
occurrences prior to, at or after the Effective Date, including, without
limitation: (a) Losses or Expenses related to any Pre-Closing Environmental
Matter, (b) any Loss or Expense to or in respect of any employees or former
employees of SCI, including, without limitation (i) any employment agreement,
whether or not written, between SCI and any person, (ii) any Loss or Expense
under any consulting, severance or similar contract, arrangement, policy, plan
(written or oral), program, or commitment providing for insurance coverage,
workers' compensation, disability benefits, supplemental unemployment benefits,
pension benefits, welfare benefits, vacation benefits, retirement benefits,
life, health, disability or accident benefits, deferred compensation,
profit-sharing bonuses or other forms of incentive compensation or
post-retirement insurance, compensation or benefits which SCI may have incurred,
and (iii) any claim of an unfair labor practice, or any claim under any
unemployment compensation or worker's compensation law or regulation or under
Applicable Law
<PAGE>
regarding employment discrimination, which shall have been asserted on or prior
to the Closing Date or is based on acts or omissions which occurred on or prior
to the Closing Date; (c) any Loss or Expense of SCI in respect of any Tax, and
any Loss or Expense in respect of Taxes attributable to Purchased Assets and
Purchased IT Assets for taxable periods, or portions thereof, ending on or prior
to the Closing Date consistent with Article 3.5; (d) any Loss or Expense arising
from any injury to or death of any person or damage to or destruction of any
property, whether based on negligence, breach of warranty, strict liability,
enterprise liability or any other legal or equitable theory arising from defects
in products manufactured or from services performed by or on behalf of SCI on or
prior to the Closing Date, except to the extent any such Loss or Expense is
attributable to defects in products supplied to SCI by OSI or its Affiliates;
and (e) any Loss or Expense of SCI arising out of or related to any action, suit
or proceeding against SCI or any action, suit or proceeding which adversely
affects the Purchased Assets or the Purchased IT Assets and which shall have
been asserted on or prior to the Closing Date or to the extent the basis of
which shall have arisen on or prior to the Closing Date.

      "Expenses" means any and all costs and expenses incurred, including,
without limitation, court filing fees, court costs, arbitration fees or costs,
witness fees, and fees and expenses of legal counsel, investigators, expert
witnesses, consultants, accountants and other professionals.

      "Governmental Body" means any national, federal, state, county, local,
district, public authority, public agency, or any other political subdivision,
public corporation, or governmental or regulatory authority whether
international or of any country or autonomous territory.

      "Governmental Order" means any judgment, order, award or decree of any
foreign, national, federal, state, local or other court or tribunal, or any
Governmental Body and any award in any arbitration proceeding, as in effect
during the period from the Effective Date up to and including the Payment Date.

      "Gross Margin" has the meaning specified in Article 2.9 hereof.

      "Intangible Assets" has the meaning specified in Article 2.1(a)(v) hereof.

      "Intellectual Property" means (a) inventions, whether or not patentable,
whether or not reduced to practice, and whether or not yet made the subject of a
pending patent application or applications; (b) ideas and conceptions of
potentially patentable subject matter, including without limitation, any patent
disclosures, whether or not reduced to practice and whether or not yet made the
subject of a pending patent application or applications; (c) all worldwide
statutory invention registrations, patents, patent registrations and patent
applications (including all reissues, divisions, continuations,
continuations-in-part, extensions and reexaminations) and all rights therein
provided by law, multinational treaties or conventions and all improvements to
the inventions disclosed in each such registration, patent or application; (d)
trademarks, service marks, trade dress, logos, trade names and corporate names,
including all of the goodwill associated therewith, whether or not registered,
including all common law rights, and
<PAGE>
registrations and applications for registration thereof, including, but not
limited to, all marks registered in the Patent Office of Japan, and the
trademark offices of other nations throughout the world, and all rights therein
provided by multinational treaties or conventions; (e) copyrights, whether or
not registered, and registrations and applications for registration thereof, and
all rights therein provided by law, multinational treaties or conventions; (f)
mask works or registrations of mask works; (g) trade secrets and confidential,
technical information (including ideas, formulas, compositions, inventions, and
conceptions of inventions whether patentable or unpatentable and whether or not
reduced to practice); (h) technology (including know-how and show-how),
manufacturing and production processes and techniques, research and development
information, drawings, specifications, designs, plans, proposals, technical data
and copyrightable works, whether secret or confidential or not; (i) copies and
all tangible embodiments of all of the foregoing, in whatever form or medium;
(j) all rights to obtain and rights to apply for patents, and to register
trademarks and copyrights; and (k) all rights to sue for and recover and retain
damages, costs or attorneys' fees for present and past infringement of any of
the intellectual property rights hereinabove set out.

      "Inventory" means disposable contact lenses, conventional contact lenses,
solutions and other contact lens related products that SCI has purchased for its
contact lens business and business related thereto, but SCI has not yet sold to
anyone. The Inventory consists of the Consigned Inventory and the Non-Consigned
Inventory.

      "Leased Premises" means the premises where SCI conducts its contact lens
business and business related thereto listed in Exhibit A.

      "Losses" means any and all losses, costs, obligations, liabilities,
settlement payments, awards, judgments, fines, penalties, damages, deficiencies
or other charges.

      "Material Adverse Effect" means a material adverse effect on the physical
condition or value of the Purchased Assets, the Purchased IT Assets, the assets
subject to the Leases and Licenses or the business currently conducted by SCI.

      "Merchantable Consigned Inventory" means Consigned Inventory other than
Excepted Inventory.

      "Non-Consigned Inventory" means all Inventory other than Consigned
Inventory.

      "Non-Essential Leases and Licenses" has the meaning specified in Article
9.8 hereof.

       "OSI Group Member" means OSI, OSKK, their officers, directors,
stockholders, agents and Affiliates.

      "Payment Date" means the date that is twenty-nine (29) days following the
Closing Date; provided, however, in the event SCI and OSKK shall not have agreed
upon the Closing Asset Schedules pursuant to Article 3.2 with respect to which
the consideration specified in Article 3.1 is to be determined, such later date
on which
<PAGE>
disputes with respect to the Closing Asset Schedules shall be agreed upon
pursuant to Article 3.2), or such other time and date as the parties shall agree
in writing.

      "Permits" means all licenses, permits, franchises, approvals,
authorizations, consents or orders of, or filings with, any Governmental Body or
any other Person, necessary or used in the business of SCI as conducted on and
prior to the Effective Date.

      "Person" means any individual, corporation, partnership, limited liability
company, joint venture, association, joint-stock company, trust, unincorporated
organization, Governmental Body or any other entity.

      "Post-Effective Date Supply Order" has the meaning specified in Article
8.3 hereof.

      "Pre-Closing Environmental Matters" means (a) the production, use,
generation, emission, storage, treatment, transportation, recycling, disposal,
discharge, release, or other handling or disposition of any kind on or prior to
the Closing Date (collectively, "Handling") by SCI or its Affiliates (including
any other entities, the assets or obligations of which have been acquired or
assumed by SCI or to which SCI has succeeded, collectively, "Predecessors") of
any Substance, either in, on, from or under any real property or facility owned,
leased or used at any time by SCI or its Affiliates or their Predecessors in
connection with the operation of SCI's business, including any offsite disposal
facilities (an "Operating Site"), including, without limitation, the effects of
such Handling of Substances on resources, Persons, or property within or outside
the boundaries of any Operating Site, and (b) any other act or omission of the
SCI or its Affiliates or their Predecessors prior to the Closing Date that gives
rise to liability or potential liability under any Environmental Law.

      "Purchased Assets" has the meaning specified in Article 2.1(a) hereof.
Purchased Assets are exclusive of (i) those Intellectual Properties proprietary
to SE and/or SECL set forth in Schedule 2.11, (ii) the Clinical and Analytical
Instruments owned by SE (set forth in Schedule 2.12(b)), (iii) any Purchased IT
Assets or assets subject to the Leases and Licenses, and (iv) any third party
Intellectual Property.

      "Purchased IT Assets" has the meaning specified in Article 2.3(a) hereof;
provided, however, for purposes of this Agreement, Purchased IT Assets are
neither Tangible Fixed Assets nor Intangible Assets nor Purchased Assets.

      "Record Date" means January 31, 2002.

      "Return Credit" has the meaning specified in Article 2.9 hereof.

      "SCI Group Member" means SCI, SE, SECL, SC, their officers, directors,
stockholders, agents and Affiliates.

      "SCI Liaison" has the meaning specified in Article 2.2(h) hereof.
<PAGE>
      "Substance" means any pollutants, contaminants, chemicals, waste and any
toxic, infectious, carcinogenic, reactive, corrosive, ignitible or flammable
chemical or chemical compound or hazardous substance, material or waste, whether
solid, liquid or gas, including any quantity of asbestos in any form, urea
formaldehyde, PCB's, radon gas, crude oil or any fraction thereof, all forms of
natural gas, petroleum products or by-products or derivatives, radioactive
substance, waste waters, sludges, slag and any other substance, material or
waste that is subject to regulation, control or remediation under any
Environmental Laws.

      "Tangible Fixed Assets" has the meaning specified in Article 2.1(a)(i)
hereof.

      "Tax" means any national, federal, prefectural, state or local net income,
alternative or add-on minimum, gross income, gross receipts, property, sales,
use, value-added, registration, transfer, gains, license, excise, employment,
payroll, withholding or minimum tax, or any other tax custom, duty other than
stamp duty, governmental fee or other like assessment or charge of any kind
whatsoever, together with any interest or any penalty, addition to tax or
additional amount imposed by any Governmental Body.

      "Undelivered Orders" has the meaning specified in Article 8.3 hereof.
<PAGE>
                         LIST OF SCHEDULES AND EXHIBITS

                                  Schedule 1.1
                                   Definitions

                              Schedule 2.1(a)(i)(x)
  Tangible Fixed Assets At Book Value (as of the Record Date), Excluding Assets
                                 Without Charge

                              Schedule 2.1(a)(i)(y)
  Tangible Fixed Assets With No Book Value or Without Charge (as of the Record
                                      Date)

                               Schedule 2.1(a)(ii)
                   Accounts Receivable (as of the Record Date)

                              Schedule 2.1(a)(iii)
                Non-Consigned Inventories (as of the Record Date)

                               Schedule 2.1(a)(iv)
                  Consigned Inventories (as of the Record Date)

                              Schedule 2.1(a)(v)(h)
                                   Trademarks

                              Schedule 2.1(a)(v)(i)
              Telephone Subscription Rights (as of the Record Date)

                                 Schedule 2.2(a)
                        Employees (as of the Record Date)

                                 Schedule 2.2(c)
                                   Key People

                                 Schedule 2.2(h)
                                   SCI Liaison

                                 Schedule 2.3(a)
                               Purchased IT Assets

                                 Schedule 2.3(b)
                               Leases and Licenses

                                 Schedule 2.4(a)
             Form of Distribution Service Agreement With Chart K.K.
<PAGE>
                                 Schedule 2.5(c)
                                 Counter-parties

                                 Schedule 2.6(b)
                           Zantei-Operation Agreement

                                 Schedule 2.8(b)
                                Supply Agreement

                                 Schedule 2.9(a)
              Form of Notice of Assignment of Account(s) Receivable

                                  Schedule 2.10
                        Seiko Trademark License Agreement

                                  Schedule 2.11
     Intellectual Properties owned by SE and/or SECL (as of the Record Date)

                                Schedule 2.12(a)
           Clinical and Analytical Evaluation Services Agreement Terms

                                 Schedule 2.12(b)
                 Clinical and Analytical Instruments Owned by SE

                                 Schedule 4.1(a)
                  Disclosure of Encumbrances on Purchased Assets

                                 Schedule 5.1(c)
              Tangible Fixed Assets Not In Good Condition or Repair

                              Schedule 5.1(d)(iii)
                    Royalties Payable On Intellectual Property

                                 Schedule 5.1(f)
                                    Contracts

                                 Schedule 5.1(l)
                           History of Bad Debt Expense

                                 Schedule 5.1(n)
                                     Permits

                                  Schedule 9.8
                        Non-Essential Leases and Licenses
<PAGE>
                                  Schedule 9.9
               Memoranda of Understanding Regarding Leased Premises

                                    Exhibit A
                                 Leased Premises

                                    Exhibit B
                      SCI Accounting Policies and Practices

                                    Exhibit C
                              Discontinued Products

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