Document:

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                                                                   EXHIBIT 10.85

                                 SETTLEMENT NOTE

$2,189,795.00                                                     March 29, 2002
                                                         Los Angeles, California

        FOR VALUE RECEIVED, the receipt and sufficiency of which is
acknowledged, Sally M. Pollet ("Maker"), hereby promises to pay to STAAR
Surgical Company, or order ("Holder"), at the address designated on the
signature page of this Note, or at such other place as Holder may designate by
written notice to Maker, the principal sum herein below described ("Principal
Amount"), together with interest thereon, in the manner and at the times
provided and subject to the terms and conditions described herein.

        1.      PRINCIPAL AMOUNT.

                The Principal Amount means the sum of $2,189,795.00.

        2.      INTEREST.

                Interest on the Principal Amount from time-to-time remaining
unpaid shall accrue from the date of this Note at the rate of five percent (5%)
per annum, compounded annually. Interest shall be computed on the basis of a
three hundred sixty (360) day year and a thirty (30) day month. If, at anytime
during the term of this Note, the closing bid price for the common stock of
STAAR Surgical Company ("STAAR") on the NASDAQ (or on whichever other public
stock exchange STAAR common stock is trading at the time) is $8.00 or higher for
a period of twenty (20) consecutive trading days, or if STAAR common stock
permanently ceases to trade on any public stock exchange (i.e., is de-listed),
then interest shall thereafter accrue on this Note at the rate of nine and
three-quarters percent (9.75%) per annum, compounded annually.

        3.      PAYMENT OF PRINCIPAL AND INTEREST.

                Subject to paragraph 8, below, Maker shall pay the Principal
Amount and all accrued and unpaid interest on the Principal Amount and all other
indebtedness due under this Note either: (a) four (4) years from the date of
this Note, on March 29, 2006; or (b) the first date after the date of the
execution of this Promissory Note on which the closing bid price for STAAR
common stock on the NASDAQ (or on whichever other public stock exchange STAAR
common stock is trading at the time) is, and has been for twenty (20)
consecutive trading days, $10.00 or greater, whichever comes first. If the date
set for payment under this Note falls on a Saturday, Sunday, or holiday
recognized by either the United States of America or the State of California,
payment under this Note shall be due on the first subsequent business day.

        4.      SECURITY/RELEASE OF SECURITY.

                Maker shall pledge as security for the repayment of all sums
payable under this Note 400,000 shares of STAAR common stock (the "Stock").
Maker shall execute a Stock Pledge Agreement of even date herewith evidencing
Holder's security interest in the Stock. This is a nonrecourse Promissory Note
with regard to the Principal Amount and interest due (other

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than as to the Stock), but any fees or costs incurred pursuant to Paragraph 9 of
this Note shall constitute a recourse obligation for Maker.

        5.      PREPAYMENTS.

                Maker shall have the right to prepay any portion of the
Principal Amount and interest due without prepayment penalty or premium or
discount.

        6.      MANNER OF PAYMENTS/CREDITING OF PAYMENTS.

                Payments of any amount required hereunder shall be made in
lawful money of the United States or in such other property as Holder, in its
sole and absolute discretion, may accept, without deduction or offset, and shall
be credited first against accrued but unpaid fees and costs, if any, thereafter
against accrued but unpaid interest, if any, and thereafter against the unpaid
balance of the Principal Amount.

        7.      INTEREST ON DELINQUENT PAYMENTS.

                Any payment under this Note not paid when due shall bear
interest at the same rate and method as interest is charged on the Principal
Amount from the due date until paid.

        8.      ACCELERATION UPON DEFAULT.

                At the option of Holder, all or any part of the indebtedness of
Maker hereunder shall immediately become due and payable, irrespective of any
agreed maturity date, upon the happening of any of the following events of
default:

                (a)     If Maker shall breach any condition or obligation
        imposed on Maker pursuant to the terms of this Note, the Settlement
        Agreement And General Release of even date, or the Stock Pledge
        Agreement of even date, provided however that if any such breach is
        reasonably susceptible of being cured, Maker shall be entitled to a
        grace period of fifteen (15) days following written notice of such event
        of default to cure;

                (b)     If Maker shall make an assignment for the benefit of
        creditors;

                (c)     If a custodian, trustee, receiver, or agent is appointed
        or takes possession of substantially all of the property of Maker;

                (d)     If Maker shall be adjudicated bankrupt or insolvent or
        admit in writing Maker's inability to pay Maker's debts as they become
        due;

                (e)     If any petition is filed against Maker under the
        Bankruptcy Code and either (A) the Bankruptcy Court orders relief
        against Maker, or (B) such petition is not dismissed by the Bankruptcy
        Court within thirty (30) days of the date of filing;

                (f)     If any attachment, execution or other writ is levied on
        substantially all of the assets of Maker and remains in effect for more
        than five (5) days; or

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                (g)     If Maker shall apply for or consent to the appointment
        of a custodian, trustee, receiver, intervenor, liquidator or agent of
        Maker, or commence any proceeding related to Maker under any bankruptcy
        or reorganization statute, or under any arrangement, insolvency,
        readjustment of debt, dissolution, or liquidation law of any
        jurisdiction, whether now or hereafter in effect.

Maker shall notify Holder immediately if any event of default occurs. The
existence of the pending chapter 11 bankruptcy case, In re Sally M. Pollet, no.
ND01-13364RR before the United States Bankruptcy Court for the Central District
of California, shall not be deemed an event of default for so long as Maker
remains a debtor-in-possession, as per 11 U.S.C. Section 1107(a), in said case.
Holder's remedies, in the event of any event of default which is not cured
within the specified time period, are limited to those specified in paragraph 9
below and those specified in the Stock Pledge Agreement of even date between
Maker and Holder.

        9.      COLLECTION COSTS AND ATTORNEYS' FEES.

                Maker agrees to pay Holder all costs and expenses, including
reasonable attorneys' fees, paid or incurred by Holder in connection with the
collection or enforcement of this Note or any instrument securing payment of
this Note, including, without limitation, defending the priority of such
instrument or conducting a trustee sale thereunder. In the event any litigation
is initiated concerning the enforcement, interpretation or collection of this
Note by the parties hereto, the prevailing party in any such proceeding shall be
entitled to receive from the non-prevailing party all costs and expenses
including, without limitation, reasonable attorneys' and other fees incurred by
the prevailing party in connection with such action or proceeding.

        10.     NOTICE.

                Any notice to either party under this Note shall be given by
personal delivery or by express mail, Federal Express, DHL or similar
airborne/overnight delivery service, or by mailing such notice by first class or
certified mail, return receipt requested, addressed to such party at the address
set forth below, or to such other address as either party from time to time may
designate by written notice. Notices delivered by overnight delivery service
shall be deemed delivered the next business day following consignment to such
delivery service. Mailed notices shall be deemed delivered and received in
accordance with this provision three (3) days after deposit in the United States
mail.

11.     USURY COMPLIANCE.

                All agreements between Maker and Holder are expressly limited,
so that in no event or contingency whatsoever, whether by reason of the
consideration given with respect to this Note, the acceleration of maturity of
the unpaid Principal Amount and interest thereon, or otherwise, shall the amount
paid or agreed to be paid to Holder for the use, forbearance, or detention of
the indebtedness which is the subject of this Note exceed the highest lawful
rate permissible under the applicable usury laws. If, under any circumstances
whatsoever, fulfillment of any provision of this Note shall involve transcending
the highest interest rate permitted by law which a court of competent
jurisdiction deems applicable, then the obligations to be fulfilled

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shall be reduced to such maximum rate, and if, under any circumstances
whatsoever, Holder shall ever receive as interest an amount that exceeds the
highest lawful rate, the amount that would be excessive interest shall be
applied to the reduction of the unpaid Principal Amount under this Note and not
to the payment of interest, or, if such excessive interest exceeds the unpaid
balance of the Principal Amount under this Note, such excess shall be refunded
to Maker. This provision shall control every other provision of all agreements
between Maker and Holder.

        12.     JURISDICTION: VENUE.

                This Note shall be governed by, interpreted under and construed
and enforced in accordance with the laws of the State of California, excluding
any law relating to the conflict of laws. Any action to enforce payment of this
Note shall be filed and heard solely in Los Angeles County, California.

        13.     BUSINESS PURPOSE.

                This Note is entered into by Maker in connection with a business
transaction and not for personal, family or household purposes.

                                             MAKER:

                                             /s/ Sally M. Pollet
                                             -------------------
                                             Sally M. Pollet

                                             MAKER'S ADDRESS:

                                             10934 Alto Court
                                             Oak View, California 93022

                                             HOLDER'S ADDRESS:

                                             STAAR SURGICAL COMPANY
                                             1911 Walker Avenue
                                             Monrovia, California 91016
                                             Attn.:   Chief Financial Officer

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                                                                   EXHIBIT 10.86

                             STOCK PLEDGE AGREEMENT

        This STOCK PLEDGE AGREEMENT (hereinafter "Agreement") is made and
entered into as of March 29, 2002, by and between Sally M. Pollet, an individual
("Pledgor"), and STAAR Surgical Company, a Delaware corporation ("Pledgee"),
with reference to the following facts:

                                    RECITALS

        WHEREAS, Pledgor has executed in favor of Pledgee a promissory note (the
"Note"), a copy of which is attached hereto as Exhibit "1" and is incorporated
herein by this reference, for the sum of two million one hundred eighty-nine
thousand seven hundred ninety-five dollars ($2,189,795.00); and

        WHEREAS, Pledgor desires to pledge to Pledgee the interest of Pledgor in
certain common stock, which is included on Exhibit "2", attached hereto and
incorporated herein by this reference, pursuant to the terms of this Agreement,
for the purpose of securing payment of the Note;

        THEREFORE, in consideration of mutual covenants and promises contained
herein, and for valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties to this Agreement (hereinafter collectively
"parties" and individually "party") agree as follows:

                                    AGREEMENT

        1.      PLEDGE OF STOCK AND PROCEEDS.

                (a)     Original Pledge. As collateral security for the payment
and/or performance of all of Pledgor's presently existing or hereinafter arising
obligations and liabilities to Pledgee under the Note, Pledgor hereby pledges,
grants and assigns to Pledgee a continuing first-priority security interest in
the following:

                        (i)     four hundred thousand (400,000) shares of the
common stock of STAAR Surgical Company and all certificates evidencing such
shares (the "Stock"); and

                        (ii)    the proceeds of the Stock including, without
limitation, any and all dividends, cash, instruments and other property from
time-to-time received, receivable, or otherwise distributed in respect of or in
exchange for any of the Stock ("Proceeds"). The Stock and the Proceeds shall
hereinafter be collectively referred to as the "Collateral."

                (b)     Delivery of Stock Power to Pledgee. Pledgor shall
deliver to Pledgee, concurrently with the execution of this Agreement, the
original certificates evidencing such Stock along with an Assignment of
Corporate Shares in the form of Exhibit "3" attached hereto and incorporated
herein by this reference ("Stock Assignment"), signed by Pledgor, in blank, such
Stock Assignment to be used by Pledgee in accordance with the terms of this
Agreement.

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                (c)     Pledgee's Acceptance of Collateral and Appointment as
Pledgor's Attorney-In-Fact. Pledgee hereby agrees to accept the Collateral and
agrees to hold and dispose of the Collateral in accordance with and subject only
to the terms of this Agreement. Pledgor hereby irrevocably appoints Pledgee as
Pledgor's attorney-in-fact to arrange for the transfer of the Collateral and to
do and perform all actions that are necessary or appropriate in order to effect
the terms of this Agreement.

                (d)     Release of Collateral. Pledgee shall release the
Collateral from this Agreement and return the Collateral to Pledgor upon
satisfaction in full of Pledgor's obligations under the Note.

        2.      MATTERS PERTAINING TO THE COLLATERAL.

                (a)     Voting and Consensual Rights. Pledgor shall retain the
right to vote the Stock and to exercise any other rights pertaining to the
Stock, provided, however, so long as Pledgor is in "Default" as defined in
Paragraph 3 of this Agreement, Pledgee may vote the Stock and exercise any
rights pertaining to the Stock. Pledgor may sell the Stock, or any portion
thereof, free and clear of STAAR's first-priority security interest therein, so
long as Pledgor contemporaneously pays to Pledgee an amount equal to or greater
than five dollars and fifty cents ($5.50) per share of the Stock so sold.
Pledgee shall apply such payments against all amounts due under the Note.

                (b)     Rights to Dividends and Distributions. Pledgee, rather
than Pledgor, shall be entitled to collect and receive all of the following
types of proceeds, which shall be added to and shall become a part of the
Collateral:

                        (i)     all proceeds paid or payable, and all
instruments and other property distributed in respect of, or in exchange for,
the Stock;

                        (ii)    all proceeds paid or payable with respect to the
Stock in connection with a partial or total liquidation or dissolution of the
issuing corporation or in connection with a reduction of capital, capital
surplus or paid-in surplus of the issuing corporation; and

                        (iii)   all proceeds distributed in redemption of, or in
exchange for, the Stock. To the extent the foregoing proceeds exceed the amount
of Pledgor's obligations and liabilities under the Note and/or this Agreement,
Pledgor shall be entitled to receive these excess proceeds.

                (c)     Stock Adjustments. In the event that, during the term of
this Agreement, any stock dividend, reclassification, readjustment, or other
change is declared or made in the capital structure of the issuing corporation,
all new, substituted and additional shares or other securities issued with
respect to the Stock by reason of any such change shall be delivered to and held
by Pledgee under the terms of this Agreement in the same manner as the Stock.

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        3.      DEFAULT AND REMEDY ON DEFAULT.

                At the option of Pledgee, upon the happening of any of the
following events of default ("Default"):

                (a)     Default Under Note. If an event of default, as set forth
in paragraph 8 of the Note, occurs and is not cured as specifically provided
therein; or

                (b)     Default Under This Agreement. If Pledgor defaults in the
due performance or observance of any representation or obligation under this
Agreement;

Pledgee shall have all of the rights and remedies set forth in this Stock Pledge
Agreement and paragraph 9 of the Note, in addition to the rights and remedies of
a secured party under Division 9 of the California Uniform Commercial Code. Upon
default, the right of Pledgor to vote the Stock and to exercise any other rights
pertaining to the Stock shall cease.

        4.      PLEDGOR'S REPRESENTATIONS, WARRANTIES AND COVENANTS.

                Pledgor represents, warrants and covenants to Pledgee as
follows:

                (a)     Upon delivery to Pledgee as contemplated hereby, and
upon approval by the United States Bankruptcy Court for the Central District of
California in case no. ND01-13364RR, the Collateral will be free of any security
interests, liens, pledges or encumbrances created by Pledgor or her
predecessors-in-interest (except for the security interest created hereby), or
any claims of third parties of any nature whatsoever, charges, escrows, options,
rights of first refusal, or other agreements, restrictions, arrangements,
commitments or obligations, written or oral, created by Pledgor or her
predecessors-in-interest, affecting the legal or beneficial ownership of the
Collateral.

                (b)     From and after the date hereof, Pledgor shall not make
any agreements restricting in any manner the transferability of the Collateral
or otherwise affecting the Collateral;

                (c)     Pledgor shall, at Pledgor's expense, take any steps
necessary to preserve Pledgee's rights in the Collateral against any claims of
third parties;

                (d)     Pledgor has arrangements for keeping informed of changes
or potential changes affecting the Collateral (including, without limitation,
rights to convert, rights to subscribe, payment of dividends, reorganization or
other exchanges, tender offers and voting rights), and Pledgee shall not have
any responsibility or liability for informing Pledgor of any such changes or
potential changes or for taking any action or omitting to take any action with
respect thereto; and

                (e)     Pledgor's full and correct legal name is Sally M.
Pollet. Pledgor's principal residence is located at 10934 Alto Court, Oak View,
California. Pledgor shall notify Pledgee within five (5) days of changing either
Pledgor's full and correct legal name or Pledgor's principal residence.

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        5.      MISCELLANEOUS.

                (a)     It is acknowledged by each party that such party either
had separate and independent advice of counsel or the opportunity to avail
himself or itself of same. This Agreement was prepared by each party in
conjunction with counseling from such party's respective attorney or the
opportunity to obtain such counseling. In light of these facts it is
acknowledged that no party shall be construed to be solely responsible for the
drafting of this Agreement, and therefore any ambiguity shall not be construed
against any party as the alleged draftsman of it. Each party shall pay all costs
and expenses incurred or to be incurred by such party in negotiating and
preparing this Agreement and in performing and complying with all
representations, warranties, covenants, agreements and conditions contained in
this Agreement to be performed or complied with by such party, including legal
fees.

                (b)     Each party agrees, without further consideration, to
cooperate and diligently perform any further acts, deeds and things and to
execute and deliver any documents that may be reasonably necessary to
consummate, evidence, confirm and/or carry out the intent and provisions of this
Agreement, all without undue delay or expense. Pledgor shall reimburse Pledgee
for any costs and expenses incurred by Pledgee in connection with any breach or
default of Pledgor under this Agreement, including collection efforts, whether
or not suit is commenced or judgment is entered. Further, should any party
institute or should the parties otherwise become a party to any action or
proceeding to enforce or interpret this Agreement, the prevailing party in any
such action or proceeding shall be entitled to receive from the non-prevailing
party all costs and expenses of prosecuting or defending the action or
proceeding. Pledgor's liability, if any, under this paragraph, shall constitute
a recourse liability. This Agreement and the rights of each party under this
Agreement shall be governed by, interpreted under, and construed and enforced in
accordance with the laws of the State of California, excluding any law relating
to the conflict of laws.

                (c)     Any agreement hereafter made shall be ineffective to
modify, supplement or discharge the terms of this Agreement, in whole or in
part, unless such agreement is in writing and signed by the party against whom
enforcement of the modification, supplement or discharge is sought. By execution
hereof, the parties specifically disavow any desire or intention to create a
"third party" beneficiary contract, and specifically declare that no person or
entity, save and except for the parties and their permitted successors, and
assigns, shall have any rights hereunder nor any right of enforcement hereof. No
waiver of any breach of any agreement or provision herein contained shall be
deemed a waiver of any preceding or succeeding breach thereof. If any term or
provision of this Agreement or the application thereof to any person or
circumstance shall, to any extent, be determined to be invalid, illegal or
unenforceable, then the remaining part of this Agreement shall nevertheless not
be affected thereby and shall continue in full force and effect to the fullest
extent provided by law. This Agreement is to be read, construed and applied
together with the Note and that certain Settlement Agreement And General Release
of even date, which, taken together, set forth the complete understanding and
agreement of the parties with respect to the matters referred to herein and
therein.

                (d)     Pledgor may not delegate its duties under this
Agreement, in whole or in part, without the prior written consent of Pledgee,
which consent may be withheld in Pledgee's sole and arbitrary discretion.
Notwithstanding the preceding sentence, no such delegation shall

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release Pledgor from any liability or obligation under this Agreement without
the written consent of Pledgee, which consent may be withheld in Pledgee's sole
and arbitrary discretion. Subject to the foregoing, all of the representations,
warranties, covenants, conditions and provisions of this Agreement shall be
binding upon and shall inure to the benefit of each party and such party's
respective heirs, executors, administrators, legal representatives, successors
and/or assigns.

                (e)     The headings used in this Agreement are for convenience
and reference purposes only, and shall not be used in construing or interpreting
the scope or intent of this Agreement or any provision hereof. References to
this Agreement shall include all amendments or renewals thereof. As used in this
Agreement, each gender shall be deemed to include each other gender, including
neutral genders or genders appropriate for entities, if applicable, and the
singular shall be deemed to include the plural, and vice versa, as the context
requires.

                (f)     All notices, demands, requests, consents, approvals or
other communications ("Notices") given hereunder shall be as provided in the
Note.

                (g)     If a Default is not cured within the prescribed time
period, whether or not any of the Collateral has been effectively registered
under the Securities Act of 1933, as amended, or other applicable laws, Pledgee
may, in its sole and absolute discretion, sell all or any part of such
Collateral at private sale in such manner and under such circumstances as
Pledgee may deem necessary or advisable in order that the sale may be lawfully
conducted. Without limiting the following, Pledgee may (i) approach and
negotiate with a limited number of potential purchasers, and (ii) restrict the
prospective bidders or purchasers to persons who will represent and agree that
they are purchasing such Collateral for their own account for investment and not
with a view to the distribution or resale thereof. If Collateral is sold at
private sale, Pledgor agrees that if such Collateral is sold for a price which
Pledgee in good faith believes to be reasonable under the circumstances then
existing, then (a) the sale shall not be deemed to be commercially unreasonable
by reason of price, (b) Pledgor shall not be entitled to a credit against the
Note in any amount in excess of the purchase price, and (c) Pledgee shall not
incur any liability or responsibility to Pledgor in connection therewith,
notwithstanding the possibility that a substantially higher price might have
been realized at a public sale. Pledgor recognizes that a ready market may not
exist for such Collateral if it is not regularly traded on a recognized
securities exchange, and that a sale by Pledgee of any such Collateral for an
amount substantially less than a pro rata share of the fair market value of the
issuer's assets minus liabilities may be commercially reasonable in view of the
difficulties that may be encountered in attempting to sell a large amount of
such Collateral or Collateral that is privately traded.

                          (continued on following page)

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        WHEREFORE, the parties hereto have executed this Agreement as of the
date first set forth above.

                                                  PLEDGOR:

                                                  ------------------------------
                                                  Sally M. Pollet
                                                  10934 Alto Court
                                                  Oak View, California  93022

                                                  PLEDGEE:

                                                  STAAR SURGICAL COMPANY
                                                  1911 Walker Avenue
                                                  Monrovia, California  91016

                                                  By: --------------------------
                                                           John Bily, CFO

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        WHEREFORE, the parties hereto have executed this Agreement as of the
date first set forth above.

                                                  PLEDGOR:

                                                  /s/Sally M. Pollet
                                                  ------------------
                                                  Sally M. Pollet
                                                  10934 Alto Court
                                                  Oak View, California  93022

                                                  PLEDGEE:

                                                  STAAR SURGICAL COMPANY
                                                  1911 Walker Avenue
                                                  Monrovia, California  91016

                                                  By:  /s/ John Bily
                                                       -------------
                                                           John Bily, CFO

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