Document:

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                                                                   EXHIBIT 10.76

                  STOCK PROMISSORY SALE AND PURCHASE AGREEMENT

                                     between

                      VAA - VISTA ALEGRE ATLANTIS SGPS, SA

                                       and

                               LIBBEY EUROPE B.V.

                          DATED AS OF JANUARY 10, 2005

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                                TABLE OF CONTENTS

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PREAMBLE; RECITALS.............................................................................   1

ARTICLE 1 SALE AND PURCHASE OF SHARES..........................................................   1

1.1.        Sale and Purchase..................................................................   1

1.2.        Purchase Price.....................................................................   2

1.3.        Earn-out Payment...................................................................   3

1.4.        Post-Closing Adjustment............................................................   6

1.5.        Payments...........................................................................   7

ARTICLE 2 CLOSING..............................................................................   7

2.1.        Date and Place of Closing..........................................................   7

2.2.        Closing Transactions and Deliveries................................................   8

2.3.        Endorsement of Share Certificates..................................................   8

ARTICLE 3 REPRESENTATIONS AND WARRANTIES OF THE PURCHASER......................................   9

3.1.        Organization; Authority; Execution.................................................   9

3.2.        Consents...........................................................................   9

3.3.        Effect of the Transaction..........................................................   9

ARTICLE 4 REPRESENTATIONS AND WARRANTIES OF THE SELLER.........................................   9

4.1.        Organization; Authority; Execution.................................................   9

4.2.        Capital............................................................................  10

4.3.        Ownership of the Shares............................................................  11

4.4.        Consents...........................................................................  11

4.5.        Effect of the Transaction..........................................................  11

4.6.        Compliance with Law................................................................  12

4.7.        Accounting and Financial Documents.................................................  12

4.8.        Conduct of Business................................................................  13

4.9.        Sufficiency of Information Technology; Services....................................  14

4.10.       Real Property......................................................................  15

4.11.       Movable Property and Business......................................................  15

4.12.       Intellectual Property Rights.......................................................  15

4.13.       Receivables........................................................................  16

4.14.       Inventory..........................................................................  16

4.15.       Contracts..........................................................................  16

4.16.       Bonus Programs.....................................................................  18

4.17.       Subsidies..........................................................................  18
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4.18.       Insurance..........................................................................  18

4.19.       Employment Matters.................................................................  18

4.20.       Pension and Other Employee Benefit Matters.........................................  20

4.21.       Tax; Social Security; Customs......................................................  21

4.22.       Environment........................................................................  22

4.23.       Litigation and Proceedings.........................................................  22

4.24.       Product Liability..................................................................  23

4.25.       Bank Accounts and Signature Powers.................................................  23

4.26.       Intermediaries.....................................................................  23

4.27.       Customer-owned Molds...............................................................  23

4.28.       Completeness of Representations and Warranties.....................................  23

ARTICLE 5 COVENANTS OF THE PURCHASER...........................................................  23

5.1.        Best Efforts Undertaking...........................................................  23

5.2.        Confidentiality....................................................................  24

5.3.        Restricted Actions; Board of Directors.............................................  24

5.4.        Board Member.......................................................................  24

ARTICLE 6 COVENANTS OF THE SELLER..............................................................  25

6.1.        Best Efforts Undertaking...........................................................  25

6.2.        Confidentiality and Exclusivity....................................................  25

6.3.        Management of the Company..........................................................  25

6.4.        Non-competition and Non-solicitation...............................................  25

6.5.        Employee Notification..............................................................  26

6.6.        Access and Information.............................................................  26

6.7.        Cancellation of Related-Party Contracts and Satisfaction of Debts..................  26

6.8.        Waivers............................................................................  27

6.9.        Assistance with Regard to Relationships............................................  27

6.10.       Further Agreements.................................................................  27

6.11.       Transfer Pricing File..............................................................  27

6.12.       Remaining Shares...................................................................  27

6.13.       Intellectual Property..............................................................  28

6.14.       Governmental Authorities...........................................................  28

6.15.       Government Incentive Contract......................................................  28

6.16.       Satisfaction of Indebtedness.......................................................  28

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6.17         Receipts of Payment................................................................  28

ARTICLE 7  INDEMNIFICATION......................................................................  28

7.1.         Indemnification by the Seller......................................................  28

7.2.         Indemnification by the Purchaser...................................................  29

7.3.         Environmental Matters..............................................................  29

7.4.         Notification and Payment of Claims.................................................  30

7.5.         Third Party Claims.................................................................  30

7.6.         Determination of the Indemnification Amount........................................  31

7.7.         Threshold..........................................................................  32

7.8.         Deductible.........................................................................  32

7.9.         Maximum Amount.....................................................................  32

7.10.        Exceptions to Limitations on Indemnification.......................................  32

7.11.        Interest...........................................................................  33

7.12.        Deadlines for Claims...............................................................  33

7.13.        Release............................................................................  33

7.14.        Duty to Mitigate...................................................................  33

ARTICLE 8  FURTHER AGREEMENTS...................................................................  33

8.1.         Merger Notification................................................................  33

8.2.         Employee Issues....................................................................  33

8.3.         Outlet Stores......................................................................  34

8.4.         Historical Data on BAAN............................................................  34

8.5.         Supply of Non-Soda Lime Glassware and Ceramic Products.............................  34

8.6.         IVIMA Warehouse....................................................................  34

8.7.         Cancellation and Replacement of Guarantees.........................................  34

8.8.         Government Incentive Contract......................................................  35

8.9          Payments for Furnace Repairs.......................................................  36

ARTICLE 9  CONDITIONS TO CLOSING; TERMINATION...................................................  36

9.1.         Conditions to Each Party's Obligations.............................................  36

9.2.         Conditions to the Purchaser's Obligations..........................................  37

9.3.         Conditions to the Seller's Obligations.............................................  37

9.4.         Termination........................................................................  38

ARTICLE 10 MISCELLANEOUS........................................................................  38

10.1.        Arbitration........................................................................  38

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10.2.        Language...........................................................................  38

10.3.        Waiver; Enforcement................................................................  38

10.4.        Right to Set-off...................................................................  38

ARTICLE 11 INTERPRETATION; DEFINITIONS..........................................................  38

11.1.        Headings...........................................................................  38

11.2.        Definitions........................................................................  39

ARTICLE 12 GENERAL PROVISIONS...................................................................  45

12.1.        Cooperation........................................................................  45

12.2.        Announcements......................................................................  45

12.3.        Assignment.........................................................................  46

12.4.        Third Party Beneficiaries..........................................................  46

12.5.        Entire Agreement...................................................................  46

12.6.        Severability.......................................................................  46

12.7.        Notices and Communications.........................................................  46

12.8.        Costs..............................................................................  47

12.9.        No Waiver..........................................................................  47

12.10.       Specific Performance...............................................................  47

12.11.       Governing Law......................................................................  47
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                                TABLE OF ANNEXES

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Annex 1.2(d)          Form of Remaining Shares Escrow Agreement
Annex 1.3(b)          Net Sales and EBITDA Calculation Principles
Annex 2.2(a)(ii)      Form of Resignation Letters
Annex 2.2(a)(iv)      Form of Transfer Letter for Original Shares
Annex 2.2(c)          Form of Guarantee Letter*
Annex 2.2(e)          Form of Transfer Letter for Remaining Shares
Annex 4.1(a)          Extracts from Trade Register and Organizational Documents
Annex 4.4             Seller Consents
Annex 4.7(a)          2003 Financial Statements
Annex 4.7(b)          2004 Financial Statements
Annex 4.7(e)          Amounts Outstanding under Government Incentive Contract
Annex 4.8(a)          Conduct of Business Exceptions (January 1, 2004)
Annex 4.8(b)          Conduct of Business Exceptions (October 1, 2004)
Annex 4.9             Services by Seller and its Affiliates
Annex 4.10(a)         Real Property Ownership
Annex 4.10(b)         Real Property Leases
Annex 4.11(a)         Assets Used but not Owned or Leased
Annex 4.11(c)         Assets Used by Printglass
Annex 4.12(a)         Intellectual Property Ownership
Annex 4.12(b)         Intellectual Property Licenses
Annex 4.14            Inventory
Annex 4.15            Material Contracts
Annex 4.16            Bonus Programs
Annex 4.17            Subsidies
Annex 4.18            Insurance Claims
Annex 4.19(b)         Collective Agreements and Benefits
Annex 4.19(c)         Employees
Annex 4.19(d)         Temporary and Term Employment Agreements
Annex 4.19(e)         Increased Payments to Employees
Annex 4.20(a)         Pension and Other Benefit Commitments
Annex 4.20(b)         Pension Plan
Annex 4.20(c)         Actuarial Report
Annex 4.20(d)         Authorization of New Plan
Annex 4.21(e)         Tax and Social Receivables
Annex 4.23            Litigation
Annex 4.25            Accounts and Signatories
Annex 4.27            Customer-owned Molds
Annex 8.2             Employees Subject to Transfer
Annex 8.3             Outlet Store Employees
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*Only Annex 2.2(c) is attached. All other annexes have been omitted
intentionally. The registrant shall furnish a supplementary copy of each such
other annex to the Commission upon its request.
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                  STOCK PROMISSORY SALE AND PURCHASE AGREEMENT

This Stock Promissory Sale and Purchase Agreement, dated as of January 10, 2005
(this "AGREEMENT"), is between VAA - Vista Alegre Atlantis SGPS, SA,
incorporated and organized under the laws of Portugal with its registered office
at Largo Barao de Quintela, 3-1(degree), 1200-046 Lisbon, Portugal, registered
in the Commercial Registry of Lisboa under number 466 (the "SELLER"), and Libbey
Europe B.V., a limited liability company (besloten vennootschap met beperkte
aansprakelijkheid) organized under the laws of the Netherlands and having its
principal place of business at Lingedijk 8, 4142 LD Leerdam, The Netherlands or,
if the Purchaser notifies the Seller in writing at least five (5) days prior to
the Closing Date, an Affiliate of the Purchaser (the "PURCHASER"). The Seller
and the Purchaser are referred to herein collectively as the "Parties" and
individually as a "PARTY."

                                    RECITALS

A.    The Seller is the owner of all of the shares representing one hundred
      percent (100%) of the entire issued and outstanding interest of
      Crisal-Cristalaria Automatica, S.A., (the "SHARES"), a company
      incorporated and organized under the laws of Portugal with its registered
      office at Lugar de Casal de Areia, Freguesia de Cos, Concelho de Alcobaca,
      Portugal, with share capital of thirteen million five hundred thousand
      euro ((euro) 13,500,000) registered in the Commercial Registry of Alcobaca
      under number 3086, tax number 505 210 150 (the "COMPANY").

B.    The Seller wishes to sell and transfer, and the Purchaser wishes to
      purchase, the Shares, on the terms and subject to the conditions set forth
      hereunder.

The Parties have therefore agreed as follows:

                                   ARTICLE 1
                           SALE AND PURCHASE OF SHARES

1.1.  Sale and Purchase.

      (a)   Subject to the terms and conditions of this Agreement, the Seller
            hereby promises to sell and transfer to the Purchaser and the
            Purchaser hereby promises to purchase from the Seller, the Shares,
            in accordance with the following schedule:

            (i)   On the Closing Date, the Seller shall sell and transfer and
                  the Purchaser shall purchase ninety-five percent (95%) of the
                  Shares (the "ORIGINAL SHARES").

            (ii)  The Seller shall sell and transfer to the Purchaser and the
                  Purchaser shall purchase from the Seller the remaining five
                  percent (5%) of the Shares (or, if the Company is transformed
                  from an S.A. into another type of legal entity after the
                  Closing Date, such other right or title representing the
                  remaining five percent (5%) ownership in the Company),
                  including all rights attached thereto (the "REMAINING
                  SHARES"), on the earlier of (a) a date to be determined at the
                  sole discretion of the Purchaser and set forth in a written
                  notice sent to the Seller, but which shall not be earlier than
                  seven (7) Business Days as

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                  from such written notice, or (b) seven (7) days after the date
                  on which the Contingency Payment Statement for the Initial
                  Earn-out Calculation Period becomes final (the "REMAINING
                  SHARES PURCHASE DATE").

            (b)   The Original Shares and the Remaining Shares shall be sold
                  free and clear of all Encumbrances, together with all rights
                  attaching thereto. The representations and warranties set
                  forth in Sections 4.1(b), 4.1(c), 4.3(a), 4.3(b) and 4.4 of
                  this Agreement shall be deemed to have been restated by the
                  Seller as of the effective date of sale of the Remaining
                  Shares, as if such representations and warranties were made as
                  of such date; provided, however, that for purposes of this
                  Section 1.1(b) only, "Shares" as used in Sections 4.1(b),
                  4.1(c), 4.3(a), 4.3(b) and 4.4 shall be deemed to mean
                  "Remaining Shares" and the Seller shall make no
                  representations and warranties concerning the Company.

1.2.  Purchase Price.

      (a)   The consideration to be paid by the Purchaser to the Seller shall
            consist of

            (i)   a payment equal to twenty-seven million five hundred thousand
                  euro ((euro) 27,500,000) (the "INITIAL PAYMENT"), minus (a)
                  the amount of the principal balance of any reimbursable loans
                  (incentivos reembolsaveis), plus any accrued and unpaid
                  interest and fees or penalties, specified on the Government
                  Incentive Contract Statement required under Section 1.2(b)(i),
                  (b) the amount (if any) specified on the Indebtedness
                  Statement required under Section 1.2(b)(ii), and (c) two
                  hundred fifty thousand euro ((euro) 250,000); plus

            (ii)  an additional payment to be determined in accordance with
                  Section 1.2(c), to be paid on the Remaining Shares Purchase
                  Date; plus

            (iii) a contingent payment as described in Section 1.3 below.

      (b)   Four (4) Business Days before the Closing Date, the Seller shall
            provide the Purchaser with the following:

            (i)   a statement setting forth (a) the amount of principal balance
                  of any reimbursable loans (incentivos reembolsaveis), plus
                  accrued and unpaid interest and fees or penalties, in each
                  case as may be outstanding under the Government Incentive
                  Contract as of the Closing Date, and (b) the amount of funds
                  earned or received under the Government Incentive Contract
                  that the Seller (or the Company) has characterized as
                  non-reimbursable loans (incentivos nao reembolsaveis) as of
                  the Closing Date (the "GOVERNMENT INCENTIVE CONTRACT
                  STATEMENT"); and

            (ii)  a written notice specifying the amount of Indebtedness
                  including any accrued and unpaid interest (other than amounts
                  under Section 1.2(a)(i)(a)) that will remain outstanding on
                  the Closing Date and detailing the amounts of any additional
                  borrowings or payments made

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                  between the date of the last monthly report provided to the
                  Purchaser pursuant to Section 6.6 and the Closing Date (the
                  "INDEBTEDNESS Statement");

            provided, however, that if the Closing Date will occur fewer than
            four (4) Business Days after all of the conditions in Article 9 are
            fulfilled, the Seller shall provide such documents at such time as
            reasonably agreed by the Seller and the Purchaser.

      (c)   On the Remaining Shares Purchase Date, the Purchaser shall pay to
            the Seller either a "PERFORMANCE PAYMENT" equal to two million euros
            ((euro) 2,000,000) (reduced by the sum of any amounts due on the
            Remaining Shares Purchase Date by the Seller to the Company pursuant
            to Sections 8.8(a) and (c)), or a "DEFERRED PAYMENT" equal to one
            euro ((euro) 1) (reduced by the sum of any amounts due on the
            Remaining Shares Purchase Date by the Seller to the Company pursuant
            to Sections 8.8(a) and (c)), as follows:

            (i)   If the Remaining Shares Purchase Date is not prior to the
                  third (3rd) anniversary of the Closing Date, the Purchaser
                  shall pay an amount equal to (a) the Performance Payment if
                  the cumulative EBITDA of the Company for any eight (8)
                  calendar quarters between the Closing Date and the third (3rd)
                  anniversary of the Closing Date equals or exceeds ten million
                  euro ((euro) 10,000,000), or (b) the Deferred Payment if the
                  cumulative EBITDA of the Company does not equal or exceed ten
                  million euro ((euro) 10,000,000) for any eight (8) calendar
                  quarters during such period; and

            (ii)  If the Remaining Shares Purchase Date is on or prior to the
                  third (3rd) anniversary of the Closing Date, the Purchaser
                  shall pay an amount equal to the Performance Payment.

      (d)   On the Closing Date, the Parties shall execute and deliver, together
            with the Escrow Agent, an escrow agreement (the "REMAINING SHARES
            ESCROW AGREEMENT") in the form attached hereto as ANNEX 1.2(D). In
            accordance with the Remaining Shares Escrow Agreement and Section
            2.2(e), the Seller shall, on the Closing Date, deposit the Remaining
            Shares and the letter referred to in Section 2.2(e)(ii) with the
            Escrow Agent in accordance with the Remaining Shares Escrow
            Agreement. Such documents will be released in accordance with the
            Remaining Shares Escrow Agreement and Section 2.2(e)(ii).

1.3.  Earn-out Payment.

      (a)   The Purchaser shall pay to the Seller an earn-out payment (the
            "EARN-OUT PAYMENT"), subject to the following:

            (i)   The Purchaser shall pay an Earn-out Payment of five million
                  five hundred thousand euro ((euro)5,500,000) if

                  a.    for the thirty-six (36) month period beginning on the
                        EBITDA Start Date (the "INITIAL EARN-OUT CALCULATION
                        PERIOD"), (i) the

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                        Company's cumulative EBITDA equals or exceeds eighteen
                        million euro ((euro) 18,000,000), and (ii) the value of
                        the Company's cumulative Net Sales averages thirty
                        million euro ((euro) 30,000,000) or more per annum
                        during such Initial Earn-out Calculation Period; or

                  b.    for the last twelve (12) months of the Initial Earn-out
                        Calculation Period, (i) the Company's cumulative EBITDA
                        equals or exceeds six million euro ((euro) 6,000,000),
                        and (ii) the value of the Company's cumulative Net Sales
                        equals or exceeds thirty million euro ((euro)
                        30,000,000).

            (ii)  If the conditions in neither Section 1.3(a)(i)(a) nor Section
                  1.3(a)(i)(b) are satisfied, the following provisions will
                  apply:

                  a.    The Purchaser shall pay an Earn-out Payment of five
                        million five hundred thousand euro ((euro) 5,500,000)
                        plus interest if, during any period of four (4)
                        consecutive calendar quarters during the sixty (60)
                        month period beginning on the day after the last day of
                        the Initial Earn-out Calculation Period, (i) the
                        Company's cumulative EBITDA equals or exceeds six
                        million euro ((euro) 6,000,000), and (ii) the value of
                        the Company's cumulative Net Sales equals or exceeds
                        thirty million euro ((euro) 30,000,000). The "EXTENDED
                        EARN-OUT CALCULATION PERIOD" shall mean the period
                        beginning on the day after the last day of the Initial
                        Earn-out Calculation Period and ending on the earlier of
                        (x) the last day of such sixty (60) month period and (y)
                        the last day of the first four (4) consecutive calendar
                        quarter period in which the conditions in this Section
                        1.3(a)(ii)(a) are satisfied.

                  b.    Interest due pursuant to Section 1.3(a)(ii)(a) shall
                        accrue at a rate per annum equal to EURIBOR for three
                        (3) month interbank loans plus two and a half percent
                        (2.5%) per annum and shall be compounded. Interest shall
                        be calculated on the basis of a three hundred sixty-five
                        (365) day year and the actual number of days elapsed,
                        shall begin accruing on the first day of the Extended
                        Earn-out Calculation Period and shall cease accruing on
                        the last day of the Extended Earn-out Calculation
                        Period.

            (iii) If the Seller is not entitled to an Earn-out Payment pursuant
                  to Sections 1.3(a)(i)(a), 1.3(a)(i)(b) or 1.3(a)(ii)(a), the
                  Purchaser shall not owe the Seller an Earn-out Payment. For
                  the avoidance of doubt, the Seller shall in no event be
                  entitled to more than one Earn-out Payment.

            (iv)  The "EBITDA START DATE" shall mean January 1, 2005.

      (b)   Calculations of Net Sales and EBITDA pursuant to this Section 1.3
            shall be made on a Consistent Basis in accordance with the
            principles in ANNEX 1.3(B), which sets forth a detailed calculation
            of the Company's Net Sales and

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            EBITDA for 2003 and a detailed reconciliation of the Company's EBIT
            for 2003 to Portuguese GAAP.

      (c)   The Purchaser shall calculate Net Sales and EBITDA for the first and
            second twelve (12) month periods during the Initial Earn-out
            Calculation Period, and shall send to the Seller, within sixty (60)
            days following the end of the first twelve (12) month period and
            second twelve (12) month period, respectively, a statement setting
            forth the Net Sales and EBITDA. The Seller may notify the Purchaser
            of any disagreements it has with such calculations; provided,
            however, that the Seller shall only have the right to dispute the
            calculations relating to the first and second twelve (12) month
            periods at the end of the Initial Earn-out Calculation Period in
            accordance with Section 1.3(d). Any exercise of, or failure to
            exercise, such notice rights by the Seller shall not constitute a
            waiver of any rights or claims the Seller has under Section 1.3(d).

      (d)   The Purchaser shall calculate Net Sales and EBITDA for the
            applicable periods and shall send to the Seller, within sixty (60)
            days following the end of the Initial Earn-out Calculation Period
            and, if applicable, commencing with the fourth (4th) calendar
            quarter, at the end of each calendar quarter during the Extended
            Earn-out Calculation Period, a statement (a "CONTINGENCY PAYMENT
            STATEMENT") setting forth the Net Sales and EBITDA and stating the
            amount to be paid for the Remaining Shares pursuant to Section
            1.2(c), if applicable, and stating whether the Earn-Out Payment is
            payable to the Seller and, if applicable, the amount of interest
            due. The Contingency Payment Statement shall become final and
            binding upon the Parties thirty (30) days after the Seller's receipt
            of the Contingency Payment Statement, unless the Seller gives
            written notice to the Purchaser before such date of its disagreement
            with the Contingency Payment Statement (a "SELLER'S CONTINGENCY
            PAYMENT OBJECTION"). Any Seller's Contingency Payment Objection
            shall specify in reasonable detail the nature of any disagreement
            with the Contingency Payment Statement. During the thirty (30) days
            following the Purchaser's receipt of a Seller's Contingency Payment
            Objection, the Parties shall attempt to resolve in writing any
            differences that they may have concerning any matters set out in the
            Seller's Contingency Payment Objection. If, at the end of such
            thirty (30) day period, the Parties have not reached written
            agreement on all such matters, then either Party may refer the
            remaining differences by written notice to the Independent
            Accountant. If such a referral is not made by either Party within
            forty-five (45) days following the Purchaser's receipt of a Seller's
            Contingency Payment Objection, the Contingency Payment Statement
            will become final and binding on the Parties. If such a referral is
            made, the Independent Accountant shall resolve the matters set forth
            in the Seller's Contingency Payment Objection on which the Parties
            have not agreed, as set out in the written notice to it. The
            Independent Accountant shall give the Parties the opportunity to set
            forth in writing their positions regarding the matters in dispute
            and shall deliver its written determination of such matters to the
            Parties as soon as reasonably possible after being notified of the
            dispute. The Independent Accountant's determination shall be
            conclusive and binding upon the Parties. The fees and disbursements
            of the Independent Accountant shall be borne equally by the
            Purchaser and the Seller. The Purchaser shall make readily

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<PAGE>

            available to the Seller, and the Parties shall make readily
            available to the Independent Accountant, all relevant books and
            records and any work papers relating to the Contingency Payment
            Statement. Upon resolution of all disputed matters, the Independent
            Accountant shall cause to be prepared and shall deliver to the
            Parties the Contingency Payment Statement, reflecting the resolution
            of such disputed matters, which shall then be final and binding on
            the Parties, absent manifest error.

      (e)   If an Earn-out Payment is due, such payment shall be paid by the
            Purchaser to the Seller within seven (7) days following the date on
            which the Contingency Payment Statement for the relevant calculation
            period has become final.

      (f)   Without prejudice to Section 5.3(b) of this Agreement, the Seller's
            sole remedy in connection with any claim by the Seller that its
            contingent payment interests in the Earn-out Payment have been
            adversely affected as a result of the management of the Company's
            business after Closing shall be, in the event that an Earn-out
            Payment is not made during the Initial Earn-out Calculation Period,
            the possibility of an Earn-out Payment in relation to the Extended
            Earn-out Calculation Period in accordance with this Section 1.3.

1.4.  Post-Closing Adjustment.

      (a)   As soon as possible after the Closing, but in any event within sixty
            (60) days thereafter, the Purchaser shall at its expense prepare or
            cause to be prepared, and deliver to the Seller an audited balance
            sheet of the Company as of the Closing Date, in accordance with
            Portuguese GAAP, Applied on a Consistent Basis (the "CLOSING
            STATEMENT"), which will include information for determining the
            Closing Indebtedness and Closing Cash. In preparing such Closing
            Statement, the Purchaser shall cause the newly appointed Company's
            auditors to consult with the former auditors of the Company, and the
            Seller shall be liable for the expenses of the former auditors.

      (b)   The Closing Statement shall become final and binding upon the
            Parties thirty (30) days after the Seller's receipt of the Closing
            Statement, unless the Seller gives written notice to the Purchaser
            before such date of its disagreement with the Closing Statement (a
            "SELLER'S CLOSING STATEMENT OBJECTION"). Any Seller's Closing
            Statement Objection shall specify in reasonable detail the nature of
            any disagreement with the Closing Statement. During the fifteen (15)
            days following the Purchaser's receipt of a Seller's Closing
            Statement Objection, the Parties shall attempt to resolve in writing
            any differences that they may have concerning any matters set out in
            the Seller's Closing Statement Objection. If, at the end of such
            fifteen (15) day period, the Parties have not reached written
            agreement on all such matters, then either Party may refer the
            remaining differences by written notice to the Independent
            Accountant. If such a referral is not made by either Party within
            thirty (30) days following the Purchaser's receipt of a Seller's
            Closing Statement Objection, the Closing Statement will become final
            and binding on the Parties. If such a referral is made, the
            Independent Accountant shall resolve the matters set forth in the
            Seller's Closing Statement Objection on which the Parties have not
            agreed, as set out in the written notice to it. The Independent
            Accountant shall give the Parties the opportunity to set forth in
            writing their positions regarding the matters in dispute and shall
            deliver its written

                                       6
<PAGE>

            determination of such matters to the Parties as soon as reasonably
            possible after being notified of the dispute. The Independent
            Accountant's determination shall be conclusive and binding upon the
            Parties. The fees and disbursements of the Independent Accountant
            shall be borne equally by the Purchaser and the Seller. The
            Purchaser shall make readily available to the Seller, and the
            Parties shall make readily available to the Independent Accountant,
            all relevant books and records and any work papers relating to the
            Closing Statement. Upon resolution of all disputed matters, the
            Independent Accountant shall cause to be prepared and shall deliver
            to the Parties the Closing Statement, reflecting the resolution of
            such disputed matters, which shall then be final and binding on the
            Parties, absent manifest error.

      (c)   If the Closing Indebtedness, less the amount of any outstanding
            reimbursable amounts (including any accrued and unpaid interest and
            fees or penalties) under the Government Incentive Contract and the
            amount of any other Indebtedness that, in each case, have been
            deducted in accordance with Section 1.2(a)(i), is greater than the
            Closing Cash, the Seller shall pay such difference to the Purchaser
            as a post-Closing Purchase Price adjustment. If the Closing Cash is
            greater than the Closing Indebtedness, less the amount of any
            outstanding reimbursable amounts under the Government Incentive
            Contract (including any accrued and unpaid interest and fees or
            penalties) and the amount of any other Indebtedness that, in each
            case, have been deducted in accordance with Section 1.2(a)(i), the
            Purchaser shall pay such difference to the Seller as a post-Closing
            Purchase Price adjustment.

      (d)   Payments due under this Section 1.4 shall be made within five (5)
            days after the Closing Statement becomes final and binding on the
            Parties and shall bear interest at a rate per annum equal to EURIBOR
            for three (3) month interbank loans plus two and a half percent
            (2.5%) calculated on the basis of a three hundred sixty-five (365)
            day year and the actual number of days elapsed, from the Closing
            Date until the date of effective payment.

1.5.  Payments. All payments to be made pursuant to this Agreement shall be made
      in euros, for same day value, by certified bankers check or by wire
      transfer to the bank account notified in writing by the Seller to the
      Purchaser, or by the Purchaser to the Seller, as applicable, no later than
      four (4) Business Days before the date of payment.

                                    ARTICLE 2
                                     CLOSING

2.1.  Date and Place of Closing. Subject to Section 9.4 of this Agreement, the
      closing of the sale and purchase of the Original Shares (the "CLOSING")
      shall take place, at the option of the Purchaser, (i) within five (5)
      Business Days of the fulfillment or waiver of the last of the conditions
      set out in Article 9, (ii) on the last Business Day of the month in which
      the last of the conditions set out in Article 9 has been fulfilled or
      waived, or (iii) within the first three (3) Business Days of the month
      following the month in which the last of the conditions set out in Article
      9 has been fulfilled or waived, at the offices of Goncalves Pereira,
      Castelo Branco & Associados, PC. Marques de Pombal, 1-8(degree), 1250-160,
      Lisbon, Portugal, provided that all the conditions set out in Article 9
      remain satisfied or waived on that date. The Closing shall take place at a
      time to be set by agreement among the Parties, or failing such

                                       7
<PAGE>

      agreement, at 10.00 a.m. The date on which the Closing takes place is
      referred to herein as the "CLOSING DATE."

2.2.  Closing Transactions and Deliveries. On the Closing Date:

      (a)   The Seller shall deliver to the Purchaser:

            (i)   all corporate documents relating to the Company that are not
                  in the Company's possession (if any);

            (ii)  the written resignations of members of the corporate bodies of
                  the Company as required by the Purchaser in the form attached
                  as ANNEX 2.2(A)(II);

            (iii) copies of resolutions of the Seller's Board of Directors
                  approving the Transaction; and

            (iv)  the original of the Seller letter to the Company requesting
                  the transfer of the Original Shares in the form attached as
                  ANNEX 2.2(A)(IV).

      (b)   The Seller shall deliver to the Purchaser the share certificates
            representing the Original Shares duly endorsed in favor of the
            Purchaser.

      (c)   The Purchaser shall deliver a letter from Libbey Inc. guaranteeing
            the payment to the Seller of the Earn-out Payment, if and when it
            becomes due, in the form attached as ANNEX 2.2(C).

      (d)   The Purchaser shall pay to the Seller the Initial Payment in
            accordance with Section 1.2(a)(i).

      (e)   With regard to the Remaining Shares, the Seller shall deliver to the
            Escrow Agent:

            (i)   the respective share certificates with the endorsement in
                  blank; and

            (ii)  a letter from the Seller to the Company requesting the
                  transfer of the Remaining Shares, in the form attached as
                  ANNEX 2.2(E).

2.3.  Endorsement of Share Certificates. On the Remaining Shares Purchase Date
      and upon the payment of the Performance Payment or the Deferred Payment,
      as applicable, by the Purchaser to the Escrow Agent for the benefit of the
      Seller, the Escrow Agent will (x) fill in and complete the endorsement in
      the share certificates of the Remaining Shares referred to in Section
      2.2(e)(i) above with the identity of the Purchaser, (y) deliver to the
      Purchaser such certificates and to the Company the letter referred to in
      Section 2.2(e)(ii) above, upon releasing to the Seller the Performance
      Payment or the Deferred Payment, as applicable; provided that, in the
      event that the Company is transformed from an S.A. into another type of
      legal entity after the Closing Date, with respect to the formalities
      contemplated under (x) and (y) above, the Parties and the Escrow Agent
      shall comply with such other formalities as are required under Portuguese
      law in order to transfer the ownership interest held by the Seller in the
      Company to the Purchaser, and the Seller shall cooperate with the
      Purchaser in entering into such new arrangements with the Escrow Agent,
      including

                                       8
<PAGE>

      depositing any necessary documentation into the Remaining Shares Escrow
      Agreement, necessary to realize the objectives of this Section 2.3.

                                   ARTICLE 3
                 REPRESENTATIONS AND WARRANTIES OF THE PURCHASER

The Purchaser represents and warrants that the following statements are true and
correct as of the date hereof and will be true and correct as of the Closing
Date, unless otherwise stated:

3.1.  Organization; Authority; Execution.

      (a)   The Purchaser is a corporation duly organized and validly existing
            under the Laws of its jurisdiction of incorporation, and has the
            corporate power and authority to conduct its business as currently
            conducted.

      (b)   The Purchaser has the power and authority to enter into this
            Agreement and to carry out its obligations hereunder. The Purchaser
            has duly authorized the execution of this Agreement and the
            consummation of the Transaction, and no other corporate action on
            the part of the Purchaser is necessary to authorize the execution by
            it of this Agreement or the consummation of the Transaction.

      (c)   This Agreement has been duly executed by the Purchaser and
            constitutes a legal, valid and binding obligation of the Purchaser,
            enforceable against it in accordance with its terms.

3.2.  Consents. Except for the Merger Notification, the Purchaser is not
      required to obtain any Consents from third parties in connection with the
      execution or enforceability of this Agreement or the consummation of any
      of the Transactions.

3.3.  Effect of the Transaction. The execution of this Agreement by the
      Purchaser, its performance of its obligations hereunder, and the
      consummation by it of the Transaction does not give rise to any conflict
      with, or violation or breach of, any provision of its organizational
      documents (including its by-laws), or of any applicable Law.

                                   ARTICLE 4
                  REPRESENTATIONS AND WARRANTIES OF THE SELLER

The Seller represents and warrants that the following statements, taking into
account any exceptions, disclosures, limitations and qualifications with regard
to each such statement in the Annexes to this Article 4, are true and correct as
of the date hereof and will be true and correct as of the Closing Date:

4.1.  Organization; Authority; Execution.

      (a)   The Company is a corporation duly organized, validly existing and,
            where applicable, in good standing under the Laws of its
            jurisdiction of incorporation; the Company has the corporate power
            and authority to own, lease and operate the assets held or used by
            it. The Company is duly registered with the Commercial Registry of
            Alcobaca under number 3086, and the information contained in such
            trade register as reflected in extracts from

                                       9
<PAGE>

            such trade register dated January 6, 2005, copies of which are
            attached in ANNEX 4.1(a), is correct and complete. A copy of the
            current organizational documents of the Company is attached hereto
            in ANNEX 4.1(a).

      (b)   The Seller has the power and authority to enter into this Agreement
            and to carry out its obligations hereunder. The Seller has duly
            authorized the execution of this Agreement and the consummation of
            the Transaction, and no other corporate action on the part of the
            Seller is necessary to authorize the execution by it of this
            Agreement or the consummation of the transactions contemplated
            herein.

      (c)   This Agreement has been duly executed by the Seller, and constitutes
            a legal, valid and binding obligation of the Seller, enforceable
            against it in accordance with its terms.

      (d)   Neither the Seller nor the Company is the subject of any current,
            pending or to the Seller's best knowledge threatened Proceeding
            under any bankruptcy, insolvency, moratorium on payments, judicial
            composition, dissolution, liquidation or any other debtor relief or
            similar Laws, and no circumstances exist that would form the basis
            for the initiation of any such Proceeding.

      (e)   There has been no proposal made or resolution adopted by any
            competent corporate body of either of the Seller or the Company for
            the dissolution, liquidation, merger or split-up of either of them,
            and no circumstances exist that would form the basis for the
            mandatory dissolution or liquidation of either of them.

      (f)   The minute books or similar records of the Company (or, to the
            extent that separate minute books or similar records have not been
            kept for the Company, the documents referred to in Section 4.1(g))
            contain an accurate record of all meetings and other corporate
            action of the Company's stockholders, Board of Directors or other
            governing bodies, and any committees thereof. All of the registers,
            account books and corporate documents of the Company (or, to the
            extent that separate minute books or similar records have not been
            kept for the Company, the documents referred to in Section 4.1(g))
            have been and continue to be regularly maintained, and give a true
            and accurate account of the activities of the Company as required by
            Law in all material respects.

      (g)   The Seller has delivered to the Company, or the Company is otherwise
            in possession of all corporate documents of the Company, including
            all documents that the Company is required to keep or maintain by
            Law.

4.2.  Capital. The Seller owns all of the Shares in the Company. All of the
      Shares have been validly issued and are fully paid up and, where
      applicable, non-assessable. Except for the Shares, the Company has not
      issued or cooperated with the issue of any shares or other securities
      (including warrants) or depositary receipts of shares ("titulos
      definitivos ou provisorios ou quaisquer outros tipos de valores
      mobiliarios"). There are no options, warrants or other agreements or
      undertakings pursuant to which the Company is or could be bound to issue
      any shares or other securities (including warrants). No securities issued
      by the Company are listed on any stock exchange or unregulated market.

                                       10
<PAGE>

4.3.  Ownership of the Shares.

      (a)   The Seller is the unconditional legal and beneficial owner and the
            holder of record of the Shares, free and clear of all Encumbrances.
            The rights of the Seller with respect to the Shares is not subject
            to revocation, rescission or any form of annulment whatsoever.

      (b)   None of the Shares have been transferred or encumbered in advance
            ("oneradas por qualquer forma"), and the Seller has not received any
            notice of an attachment ("Penhora ou qualquer outro tipo de
            apreensao judicial ou extra judicial") thereon.

      (c)   Except in relation to Printglass - Transformacao de Vidro LDA, the
            Company does not own and has not committed to acquire, directly or
            indirectly, any shareholding or other interest in any corporation,
            partnership or other entity, nor does the Company serve as director
            or manager in any company or entity.

      (d)   As of the Closing Date, the Company shall be the unconditional legal
            and beneficial owner and the holder of record of share capital in
            Printglass, representing an ownership interest of nineteen percent
            (19%) of Printglass, free and clear of all Encumbrances. The rights
            of the Company with respect to such share capital will not be
            subject to revocation, rescission or any form of annulment
            whatsoever.

4.4.  Consents. Except for the Merger Notification, the Declaration and as set
      out in ANNEX 4.4, neither the Seller nor the Company is required to obtain
      any Consents from, make any filings with, or give any notices to any
      Governmental Authority or other person in connection with the execution or
      enforceability of this Agreement or the consummation of any part of the
      Transaction.

4.5.  Effect of the Transaction. The execution of this Agreement by the Seller,
      the performance by it of its obligations hereunder, and the consummation
      by it of the Transaction, does not and will not affect the legal situation
      of the Company or the Company's rights and obligations vis-a-vis third
      parties and will not give rise to any of the following:

      (a)   any conflict with, or violation of, any provision of the
            organizational documents ("Estatutos, deliberacoes dos orgaos
            sociais, regulamentos internos e similares") of the Company;

      (b)   any conflict with, or violation or breach of, any applicable Law, or
            any other obligation of the Company;

      (c)   any loss or material change in the terms of any Subsidy;

      (d)   any breach of or default or event that, with the lapse of time or
            giving of notice would constitute a default, under any Contract, or
            any contractual cause for early termination of or acceleration of
            payment under any Contract;

      (e)   any obligation to pay a bonus or indemnity of any type whatsoever to
            any employee or corporate executive of the Company;

                                       11
<PAGE>

      (f)   any change to, suspension, cancellation or withdrawal of, any
            Consent granted to the Company, or any favorable Tax or Social
            benefit or regime enjoyed by the Company;

      (g)   any entitlement for any party to be released from its obligations
            under the terms of any guarantee, comfort letter or other similar
            document issued as a surety or in support of any undertakings by the
            Company;

      (h)   any registration or creation of a pledge or other security interest
            on the assets of the Company; and

      (i)   any impairment to the continued ownership or use by the Company of
            the Intellectual Property Rights set out in Annex 4.12(a) and Annex
            4.12(b).

4.6.  Compliance with Law.

      (a)   The Company has conducted in all material respects its business in
            compliance with all applicable Laws (including, without exception,
            Laws concerning competition), Consents and Permits.

      (b)   The Company possesses all Consents and Permits required in
            connection with its operations as currently conducted, and all such
            Consents and Permits are in full force and effect. There are no
            Proceedings to modify, suspend or terminate any such Consent or
            Permit pending or, to the Seller's best knowledge, threatened, in
            each case that could reasonably be expected to have a material
            adverse effect on the Company's business as currently conducted.

      (c)   The Seller is not aware of any planned modifications to any Permits
            that could reasonably be expected to be, individually or in the
            aggregate, materially adverse to the Company.

4.7.  Accounting and Financial Documents.

      (a)   ANNEX 4.7(a) contains complete and correct copies of the audited
            financial statements (balance sheet, profit and loss statement, cash
            flow statement and notes on the accounts (including any off-balance
            sheet undertakings)) of the Company, including the report and
            opinion of the independent auditor of the Company, as of and for the
            period ended December 31, 2003, prepared in accordance with
            Portuguese GAAP Applied on a Consistent Basis (the "2003 FINANCIAL
            STATEMENTS").

      (b)   ANNEX 4.7(b) contains complete and correct copies of the unaudited
            financial statements (balance sheet, profit and loss statement and
            notes on the accounts (including off-balance sheet undertakings)) of
            the Company as of and for the period ended September 30, 2004,
            prepared in accordance with Portuguese GAAP Applied on a Consistent
            Basis and including a comparison to the comparable period ended
            September 30, 2003 (the "2004 FINANCIAL STATEMENTS" and, together
            with the 2003 Financial Statements, the "FINANCIAL STATEMENTS").

      (c)   Subject to any applicable year-end adjustments in relation to the
            2004 Financial Statements, the Financial Statements give a true and
            accurate

                                       12
<PAGE>

            account of the financial condition, assets, liabilities and results
            of operations of the Company as of the respective dates thereof and
            for the periods then ended. The 2003 Financial Statements have been
            certified without qualification by the independent auditor of the
            Company.

      (d)   As of the dates of the Financial Statements, the Company did not
            have any Liabilities, whether due or to become due, that were either
            (i) required by Portuguese GAAP to be reflected in the relevant
            Financial Statements, or (ii) individually or in the aggregate
            material to the financial condition of the Company, and that, in
            either case, were not reflected or expressly reserved against in the
            Financial Statements, specifically disclosed or provided for in the
            notes thereto.

      (e)   ANNEX 4.7(e) sets forth the amount of principal balance, plus
            accrued and unpaid interest and fees or penalties, outstanding under
            the Government Incentive Contract as of the date hereof.

4.8.  Conduct of Business.

      (a)   Since January 1, 2004, except as specifically contemplated herein or
            as indicated in ANNEX 4.8(a):

            (i)   The Company has not undertaken any transaction materially
                  modifying the substance of, or the rights over, its assets,
                  such as any transfer, pledge, lease, grant of license or other
                  rights to third parties with respect to its tangible or
                  intangible assets;

            (ii)  The Company has not incurred or become subject to any
                  Liability, whether due or to become due, or entered into any
                  material transaction that is outside the Ordinary Course of
                  Business;

            (iii) The Company has not made any change in its accounting
                  procedures or practices; and

            (iv)  The Company has not agreed to do any of the foregoing.

      (b)   Since October 1, 2004, except as specifically contemplated herein or
            as indicated in ANNEX 4.8(b):

            (i)   The Company has carried out its activities in the Ordinary
                  Course of Business, using commercially reasonable efforts to
                  (a) preserve the organization and value of its business, its
                  goodwill and reputation, its relationships with its main
                  clients, suppliers, customers and agents, as well as with
                  public authorities, (b) keep available the services of its
                  employees, (c) maintain all its material assets and properties
                  in working condition, and (d) comply in all material respects
                  with all contractual and other obligations applicable to its
                  business.

            (ii)  The Company has not undergone or suffered any change in its
                  condition (financial or otherwise), income, properties,
                  Liabilities whether due or to become due or operations that
                  has been, or could reasonably be expected to be, individually
                  or in the aggregate,

                                       13
<PAGE>

                  materially adverse to the Company and, to the Seller's best
                  knowledge, no such change is pending or threatened;

            (iii) The Company has not terminated any business relationship the
                  severing or cessation of which could have a material adverse
                  effect on its financial condition;

            (iv)  The Company has not declared any dividends or made any other
                  distribution of profits, reserves or retained earnings;

            (v)   The Company has not accelerated the collection of, granted any
                  discounts (other than in the Ordinary Course of Business) with
                  respect to, or sold to third parties, any accounts receivable
                  related to the Company, or delayed the payment of any payables
                  related to the Company or any portion thereof for a period
                  longer than fifteen (15) days beyond the normal payment
                  conditions of the Company; without limitation of the
                  foregoing, all charges and expenses related to the Contracts
                  listed in Annex 4.15, as required by Section 4.15(m) (except
                  in relation to the financial leases listed under Section
                  6.16), to the extent that such charges and expenses relate to
                  the Company's furnace number 2 (including expenditures made
                  for the reconfiguration of its machines), have been paid in
                  full;

            (vi)  The Company has not agreed to any merger, de-merger, spin-off
                  or consolidation; changed its share capital, issued any
                  securities of any nature whatsoever (including warrants),
                  granted any stock options, or purchased any of its own
                  securities;

            (vii) No amendments have been made to the organizational documents
                  (including articles of association and by-laws) of the
                  Company;

           (viii) The Company has not, except in the Ordinary Course of
                  Business, (i) varied the terms of any existing Indebtedness or
                  guarantee; (ii) subjected any of its properties or other
                  assets to any Encumbrance other than Permitted Encumbrances;
                  (iii) discharged or satisfied any Encumbrance or paid or
                  satisfied any Liability, whether due or to become due, in each
                  case other than upon it becoming due and payable; (iv)
                  cancelled, compromised, settled or otherwise adjusted any
                  debt, claim or Proceeding or waived or released any right
                  relating to its business; or (v) sold, assigned, transferred
                  or otherwise disposed of any assets with a book value greater
                  than fifty thousand euro ((euro)50,000); and

            (ix)  The Company has not agreed to do any of the foregoing.

4.9.  Sufficiency of Information Technology; Services. The Company owns, leases
      or licenses or is otherwise legally entitled to use all computer hardware,
      software, databases and other information technology necessary for the
      operation of its business, as currently conducted. Except as set forth in
      ANNEX 4.9, the Seller and its Affiliates do not provide any services to
      the Company.

                                       14
<PAGE>

4.10. Real Property.

      (a)   ANNEX 4.10(a) sets out a complete and accurate list of real property
            owned by the Company. The Company has good and valid title to all
            such property and, as of the Closing, all such property will be
            owned by the Company free and clear of all Encumbrances, except for
            Permitted Encumbrances. Without limiting the foregoing, no third
            party may invoke retention or similar rights in order to encumber or
            restrict the rights of the Company to the real property listed in
            Annex 4.10(a) due to any events occurring or any circumstances
            arising on or prior to the Closing Date or due to continuing events
            that started on or prior to the Closing Date.

      (b)   ANNEX 4.10(b) sets out a complete and accurate list of each parcel
            of real property leased by the Company or otherwise used (but not
            owned) by it. In each case, the Company has a valid and subsisting
            right to use the premises subject to the current conditions of use,
            in each instance free and clear of all Encumbrances other than
            Permitted Encumbrances.

      (c)   There are no zoning, condemnation or expropriation Proceedings
            pending or to the Seller's best knowledge threatened that would
            preclude or materially impair the use of any property owned, leased
            or used by the Company.

      (d)   The buildings and other facilities or installations owned by the
            Company are not built or situated on land not owned by the Company.

4.11. Movable Property and Business.

      (a)   Except as set out in ANNEX 4.11(a), the Company either owns free and
            clear of all Encumbrances other than Permitted Encumbrances, or uses
            under the terms of a valid operational or financial lease, all
            movable property, machinery and equipment that it uses (including,
            without limitation, the movable property obtained from the IVIMA
            facility and currently used by the Company).

      (b)   The computers, equipment, servers, communications networks and
            computer facilities and hardware necessary for the running and
            operation of the Company's business are in good working order, have
            received proper maintenance to assure their good working order and
            do not have nor is there reason to believe that they may have any
            defects that could materially affect their performance or limit the
            undertaking of the activities of the business taken as a whole.

      (c)   ANNEX 4.11(c) sets out a complete and accurate list of all assets
            owned or leased by the Company and used by Printglass. The Company
            either owns all such assets free and clear of all Encumbrances other
            than Permitted Encumbrances or has entered into financial leases for
            such assets.

4.12. Intellectual Property Rights.

      (a)   ANNEX 4.12(a) sets out a complete and accurate list of all
            Intellectual Property Rights that the Company owns. All such
            Intellectual Property Rights are valid and free from any
            Encumbrances (other than Permitted Encumbrances), and

                                       15
<PAGE>

            the Company has made all filings, payments and formalities necessary
            to ensure that they have full and exclusive ownership of such
            Intellectual Property Rights, enforceable against third parties. No
            license or right to use of any of the Intellectual Property Rights
            set out therein has been granted to any Person other than the
            Company.

      (b)   ANNEX 4.12(b) sets out a complete and accurate list of all
            Intellectual Property Rights that the Company uses under license.

      (c)   The Company is not infringing or has not infringed, or is not
            participating or has not participated in any infringement of, any
            Intellectual Property Rights of any other Person. There are no
            adverse claims with respect to any Intellectual Property Rights,
            either owned or licensed, that are currently pending. To the
            Seller's best knowledge, no Person is infringing any Intellectual
            Property Rights of the Company.

      (d)   To the Seller's best knowledge, there are no valid grounds for any
            bona fide claim: (i) to the effect that the use, sale or licensing
            of any product or process as now used, sold or licensed by the
            Company infringes any Intellectual Property Right of any other
            Person; (ii) against the use by the Company of any Intellectual
            Property Right of any other Person; (iii) challenging the ownership
            or validity of any Intellectual Property Right of the Company; or
            (iv) challenging the license or legally-enforceable right to use any
            Intellectual Property Right that the Company uses under license.

4.13. Receivables. Except for amounts specifically reserved for in the Financial
      Statements, all accounts receivable set out in the Financial Statements
      and all other rights of payment, including, without limitation, unbilled
      amounts and credits extended to third parties acquired by the Company
      between September 30, 2004, and the date hereof or the Closing Date, as
      applicable, (a) have arisen from bona fide transactions in the Ordinary
      Course of Business, (b) are free from any Encumbrances, and (c) to the
      Seller's best knowledge should be collectible in full within six (6)
      months from the date such right to payment arose; provided, however, that
      nothing herein may be construed as an express -------- ------- or implied
      warranty by the Seller in respect of actual collection of any such
      accounts receivable.

4.14. Inventory. The inventory set out in the Financial Statements and all
      inventory acquired by the Company between the date of the Financial
      Statements and the date hereof consist of raw materials, cartons,
      semi-finished and finished products that are usable and/or saleable in the
      Ordinary Course of Business for the purpose for which they were produced,
      subject to the percentage for depreciation of inventory as consistently
      recorded by the Company, and in quantities sufficient for the usual
      requirements of the Company and its customers. All inventory that was not
      located on the Company's site as of December 31, 2004, is set forth on
      ANNEX 4.14.

4.15. Contracts. ANNEX 4.15 sets out a complete list of all Contracts (setting
      forth only with respect to oral agreements an indication of the purpose of
      the Contract, the names of the parties thereto, its duration (definite or
      indefinite) and the amounts involved thereunder) falling under any of the
      following categories:

                                       16
<PAGE>

      (a)   Contracts (including customer contracts) involving the Company's
            obligation to pay, or entitlement to receive, under the normal
            course of such Contracts, a total amount in excess of fifty thousand
            euro ((euro) 50,000) or the equivalent thereof in any other
            currency, calculated on the date hereof;

      (b)   Contracts, the term of which exceeds one (1) year or is unlimited in
            duration (with the exception of labor agreements), that the Company
            may not terminate on less than three (3) months' notice without
            payment of an indemnity;

      (c)   Contracts giving rise to the payment by the Company of fees or any
            other consideration to the other party (or to any entity or
            individual connected therewith), other than as provided in Section
            4.15(l), in consideration for business referred or otherwise
            provided to the Company by such party;

      (d)   Contracts providing for the sharing of profits, the payment of
            commissions, or the payment of any amounts based on profits or
            revenues;

      (e)   Contracts under which the Company is bound not to carry out, or to
            restrict the performance of, certain activities, or to refrain from
            competing;

      (f)   Contracts granting exclusive rights;

      (g)   Any outstanding loans granted by the Company;

      (h)   Guarantees, sureties, warranties and credit support agreements given
            by (i) the Seller or its Affiliates for the benefit of the Company
            or (ii) the Company, excluding guarantees to secure utility
            purchases or rental payments unless such guarantees are to or for
            the benefit of the Seller or its Affiliates.

      (i)   Contracts that do not fall within the scope of the Company's
            Ordinary Course of Business, or which have been entered into under
            conditions other than those usually granted to independent parties,
            or which do not reflect market conditions or normal commercial
            practices;

      (j)   Contracts relating to the holding and/or transfer of securities or
            interest in any entity or to the control or management thereof;

      (k)   Contracts with the Seller or any of the Seller's Affiliates other
            than those in the Ordinary Course of Business;

      (l)   Representative, agency, distribution or sales contracts;

      (m)   Contracts relating to the rebuilding or the repairing of the
            Company's furnace(s) or the reconfiguration of its machines,
            involving the Company's obligation to pay, or entitlement to
            receive, under the normal course of such Contracts, a total amount
            in excess of fifty thousand euro ((euro) 50,000) or the equivalent
            thereof in any other currency, calculated on the date hereof; and

      (n)   Contracts for the supply of raw materials, electricity, mold repair
            services, natural gas or packaging materials, involving the
            Company's obligation to pay, or entitlement to receive, under the
            normal course of such Contracts, a

                                       17
<PAGE>

            total amount in excess of fifty thousand euro ((euro) 50,000) or the
            equivalent thereof in any other currency, calculated on the date
            hereof.

      All such Contracts, together with the leases under Sections 4.10(b) and
      4.11(a), licenses under Section 4.12(b), Government Incentive Contract
      under Section 4.17, and collective bargaining agreements and employment
      contracts under Sections 4.19(b) and 4.19(d), are valid and binding and in
      full force and effect, and the Company is in a position to obtain
      enforcement of the terms thereof. The Company is not in material breach of
      any such Contract and has not waived any right under any such Contract
      that could have a material adverse effect on the Company, and the Company
      has not received any notice of breach, default, acceleration or transfer
      under any such Contract. To the Seller's best knowledge, no other party to
      any Contract is in material default thereunder.

4.16. Bonus Programs. ANNEX 4.16 sets out a complete and accurate list of all
      incentive, bonus, rappel and similar programs with customers of the
      Company currently in effect.

4.17. Subsidies. ANNEX 4.17 sets out a complete and accurate list of all
      Subsidies that impose on the Company any obligations or conditions that
      remain in effect as of the date hereof or that will come into effect
      hereafter, setting out the amounts received as of the date hereof and any
      amounts remaining to be dispensed thereunder. The Company is not in breach
      of any of the terms and conditions of any Subsidy and does not anticipate
      being in breach based on current conditions, in either case that would
      result in a material adverse effect on the Company.

4.18. Insurance. ANNEX 4.18 sets out a complete list of the insurance policies
      of the Company. The corresponding premiums have been duly paid and the
      Company has complied in all material respects with the provisions thereof.
      The continuity and cost of the coverage provided by those policies shall
      not be affected by the sale of the Original Shares or the Remaining Shares
      to the Purchaser. Except as set forth on ANNEX 4.18, there is no insurance
      claim pending and, to the Seller's best knowledge, there are no
      circumstances likely to give rise to any such claim.

4.19. Employment Matters.

      (a)   There are no current or pending collective or individual labor
            disputes with the employees of the Company and, to the Seller's best
            knowledge, no such collective or individual disputes are threatened.

      (b)   ANNEX 4.19(B) sets out, for the Company:

            (i)   all applicable collective bargaining agreements;

            (ii)  the compensation scheme, including premiums, bonuses,
                  commissions, fringe benefits (without limitation, automobiles
                  and cellular telephones supplied by the Company) and any other
                  acquired rights, applicable to all of the employees or certain
                  categories thereof; and

            (iii) the profit-sharing, incentive, stock-option, company savings
                  and other similar plans,

                                       18
<PAGE>

            and no changes have been made by the Company to the rights granted
            collectively by it to its employees since January 1, 2004.

      (c)   ANNEX 4.19(c) sets out a list of all employees of the Company,
            listing the name, age, date of hire, type of employment contract and
            length of service, professional category, gross annual compensation,
            and corresponding benefits. Except as set out in ANNEX 4.19(C), no
            person is an employee of the Company or may claim such status due to
            any events occurring or circumstances arising on or prior to the
            Closing Date or due to continuing events that started on or prior to
            the Closing Date.

      (d)   Except for employment contracts with temporary and term employees,
            copies of which are set out in ANNEX 4.19(d), the Company has not
            entered into any other written employment agreements that are
            currently in effect.

      (e)   Except as set out in ANNEX 4.19(e), the Company did not undertake
            vis-a-vis its directors, collaborators or employees to pay any
            amount, as increased wages or termination payment in excess to
            amounts required by Law. ANNEX 4.19(e) sets forth any additional
            benefits granted to such persons since January 1, 2004, with the
            exception of compulsory salary increases made pursuant to the terms
            of any applicable collective bargaining agreement or as otherwise
            required by Law.

      (f)   There are no outstanding undertakings or obligations vis-a-vis
            former employees or corporate officers of the Company.

      (g)   There are no obligations of the Company vis-a-vis bodies
            representing its employees, insofar as such obligations exceed those
            provided for by applicable Law or the collective status referred to
            in Section 4.19(b).

      (h)   No claim has been made against the Company by any relevant authority
            for failure to comply with labor rules and regulations that is not
            fully and finally settled, nor are, to the best knowledge of the
            Seller, claims of such type anticipated.

      (i)   Neither the Seller nor the Company has undertaken to grant any
            benefits to any employee or corporate officer of the Company as a
            result of the completion of the sale of the Shares contemplated
            hereunder.

      (j)   The Company has not made any commitment vis-a-vis its employees in
            connection with any future dismissal or reorganization.

      (k)   The Company is and has been in compliance in all material respects
            with all provisions of labor and Social Laws, the collective status
            described in Section 4.19(b), and individual employment contracts,
            including payment of any amounts due from the retroactive salary
            increase as from due January 1, 2004, and obligations as towards the
            relevant labor authorities, including communications, notifications
            and authorizations.

                                       19
<PAGE>

      (l)   No senior executive or key employee of the Company has declared his
            or her intention to resign, and no senior executive or key employee
            of the Company has resigned since the date three (3) months before
            the date hereof.

4.20. Pension and Other Employee Benefit Matters.

      (a)   ANNEX 4.20(a) sets out a complete and accurate list of all pension,
            pre-pension, health, disability and other employee benefit
            commitments of the Company other than the Plan (as defined below).

      (b)   A copy of the Company's updated defined benefit pension and
            disability plan established to grant or to have granted pensions to
            current or former employees of the Company (the "PLAN") is attached
            as ANNEX 4.20(b). As of the date hereof and as of Closing, the
            Liabilities, whether due or to become due, for present or former
            employees of the Company under the Plan are and will be adequately
            funded under Portuguese GAAP and consistent with all statutory and
            regulatory pension funding obligations.

      (c)   A copy of the latest Certified Actuarial Report, which certifies as
            of April 30, 2004, the adequacy of the Plan reserves for the pension
            responsibilities of the Company, is attached as ANNEX 4.20(c). Since
            the date of such report, the Company has not granted, committed to
            or agreed to any salary raises or other adjustments to pensionable
            salaries that will or could result in back service or future service
            payment obligations.

      (d)   The Company was granted authorization by the applicable regulatory
            authorities for the incorporation of a new defined benefit pension
            and disability plan, a copy of which is attached as ANNEX 4.20(d).
            The Plan's assets that were transferred to such new plan are
            sufficient to fund the Liabilities, whether due or to become due,
            for present or former employees of the Company under the Plan and
            are adequately funded under Portuguese GAAP and consistent with all
            statutory and regulatory pension funding obligations.

      (e)   The Plan is the only collective and/or individual pension or
            disability scheme to which the Company is obligated to make any
            contribution or otherwise fulfill any commitment. Other than the
            Plan, the Company has no Liability (whether due or to become due)
            for any pension, pre-pension, health, disability or other employee
            benefit commitments or plans of the Seller or any of the Seller's
            Affiliates.

      (f)   All contributions to the Plan are and have been made in full, and
            all other obligations of the Company under the Plan have been fully
            satisfied, in a timely manner.

      (g)   There are no current or pending Proceedings regarding the Plan, or
            the implementation thereof, and to the Seller's best knowledge, no
            such Proceedings are threatened.

                                       20
<PAGE>

4.21. Tax; Social Security; Customs.

      (a)   The Company has timely filed and maintained true, accurate and
            complete Tax and Social reports, returns, notices and other
            documentation as required by applicable Laws, has withheld from its
            employees and timely paid to the appropriate Governmental Authority
            proper and accurate amounts for all periods through the date hereof
            as required by applicable Tax withholding provisions of applicable
            Laws, and has otherwise complied in all material respects with all
            applicable Tax and Social Laws.

      (b)   The Company has timely paid all Taxes and Social Charges that became
            due before the date hereof. The reserves appearing on the books of
            the Company at the Closing Date are sufficient to pay all Taxes and
            Social Charges due or that may become due with respect to the period
            covered thereby, regardless of whether the liability for such Taxes
            is disputed.

      (c)   No Tax or Social audit or inquiry relating to any Taxes for which
            the Company is or may be liable is pending, and the Company has not
            received any information request or similar notice from said
            authorities, which remains unsatisfied or unresolved. To the
            Seller's best knowledge, no such audit or inquiry is threatened.

      (d)   The Company is not bound by any undertaking or obligation given in
            consideration for any Tax or Social benefit or Consent. The Company
            does not own any asset (i) the tax value of which is less than its
            net book value, (ii) which is subject to any holding obligation, or
            (iii) to which any Tax or Social Liability (whether due or to become
            due) not shown in the Financial Statements is attached. The
            information provided and the representations made to the Tax or
            Social authorities by the Company in connection with the obtaining
            of any Tax or Social benefits or Consents enjoyed by them were true,
            accurate and complete in all material respects. The incentive and
            other similar plans enjoyed by the employees of the Company duly
            qualify for the Tax and Social exemptions normally applicable to
            them.

      (e)   The Company is entitled to the Tax and Social receivables (including
            the carry-back receivables) described in ANNEX 4.21(e).

      (f)   The distributable reserves and other distributable amounts appearing
            in the Financial Statements may be distributed without any Tax
            burden for the Company.

      (g)   The Company has not been made aware by its tax counsel (external or
            in-house) or auditors that a position it has taken on certain Tax or
            Social matters is based on an interpretation of the Tax rules and
            regulations likely to be challenged by the Tax or Social
            authorities.

      (h)   The Company has not made any Tax elections that are still in effect
            (including, but not limited to corporate income tax and V.A.T.).

                                       21
<PAGE>

      (i)   The Company has not assumed or is not bound to assume the Tax
            Liabilities of any other Person or to indemnify such Person for such
            Tax Liabilities (whether due or to become due).

4.22. Environment.

      (a)   No activities of the Company and no facilities or properties owned,
            leased, used or operated by it at any time between March 29, 1996,
            and the Closing are or have been the source of any pollution,
            contamination or Release that would violate or require remediation
            under any applicable Law.

      (b)   None of the land, premises or facilities owned, leased, used or
            operated by the Company as of or at any time between March 29, 1996,
            and the Closing are contaminated or polluted in a way that would
            violate or require remediation under any applicable Law.

      (c)   No dangerous or toxic wastes or substances are or have been stored
            or treated on land owned, leased, used or operated by the Company as
            of or at any time between March 29, 1996, and the Closing. The
            Company has not shipped or transported or caused the shipment or
            transportation of any dangerous or toxic wastes or substances. The
            Company has not disposed or caused the disposal of wastes on sites
            other than those designed for their storage, treatment or
            destruction and in compliance with applicable Laws.

      (d)   There are no prohibitions, injunctions, restrictions or limitations
            of any nature whatsoever on the free use or disposal by the Company
            of any of its movable assets or real property arising from their
            environmental condition, and there are no facts or circumstances
            that could reasonably provide a basis for any such prohibition,
            injunction, restriction or limitation.

      (e)   The Company has obtained and is and, to the Seller's best knowledge,
            has at all times between March 29, 1996 and the Closing been in
            compliance in all material respects with all Permits that are
            required under, and has complied in all material respects with all
            applicable Laws relating to, public health and safety, worker health
            and safety, and pollution or protection of the Environment,
            including Laws relating to Releases of pollutants, contaminants or
            chemical, industrial, hazardous or toxic materials or wastes or
            otherwise relating to the testing, manufacture, processing,
            distribution, use, treatment, storage, disposal, transport or
            handling of pollutants, contaminants or chemical, industrial,
            hazardous or toxic materials or wastes. All such Permits are valid
            and in full force for the operation of the Company's business as
            currently conducted and, where applicable, timely renewal
            applications have been submitted for all such Permits.

      (f)   The Company is not liable with respect to matters covered under this
            Section 4.22 for any other Person.

4.23. Litigation and Proceedings. Except as set out in ANNEX 4.23, there are no
      current or pending Proceedings to which the Company is a party or in which
      the Company is otherwise involved, in each case for which the Company is
      or could be reasonably expected to be liable for amounts in excess of two
      thousand five hundred euro

                                       22
<PAGE>

      ((euro) 2,500), and no such Proceedings are, to the Seller's best
      knowledge, threatened. There are no Judgments in force or outstanding
      against the Company.

4.24. Product Liability.

      (a)   The Company has not been ordered or requested by any Governmental
            Authority or judicial authority, or by any professional or consumer
            body whatsoever, to recall any product manufactured or marketed by
            it, or to inform the users thereof of the existence of any defect in
            any such product or danger caused by, or related to, its use. The
            Company does not anticipate proceeding with a spontaneous recall of
            any of its products.

      (b)   To the Seller's best knowledge, there are no grounds for the
            liability of the Company in respect of products manufactured or
            marketed by the Company.

4.25. Bank Accounts and Signature Powers. ANNEX 4.25 sets out a complete and
      accurate list of the bank accounts and safe deposit boxes opened in the
      name of or for the benefit of the Company, with the names of the persons
      authorized to operate such accounts or to have access to such deposit
      boxes, as well as a list of all of the powers of attorney granted by the
      Company.

4.26. Intermediaries. All negotiations relating to this Agreement have been
      carried out without the involvement of any person acting on behalf of the
      Seller, the Purchaser or the Company in a manner that could give rise to
      any valid claim against the Company or the Purchaser for any broker's or
      finder's fee or similar compensation in connection with the transactions
      contemplated hereby.

4.27. Customer-owned Molds. ANNEX 4.27 sets out a complete and accurate list of
      all molds used by the Company and owned by customers of the Company.

4.28. Completeness of Representations and Warranties. The Seller has not omitted
      to disclose to the Purchaser any facts that (i) would be necessary to make
      the information contained in this Agreement and its annexes not misleading
      in any material respect, or (ii) might reasonably have caused the
      Purchaser not to enter into the Transaction, or to have entered into the
      Transaction on materially different terms. Where representations and
      warranties in this Article 4 are subject to the Seller's best knowledge,
      the Seller has made reasonable efforts to obtain from Messrs. Carlos
      Alberto Martins da Silva, Mario Augusto Lopes Freire and Avelino Montez de
      Sousa Lopes, Ms. Ana Adelaide Barreira Aires, Ms. Ana Maria Campos de
      Oliveira, and the Company's directors and professional advisors all
      relevant information, and in making those representations and warranties
      the Seller has relied upon the information so obtained by it.

                                   ARTICLE 5
                           COVENANTS OF THE PURCHASER

5.1.  Best Efforts Undertaking. The Purchaser shall use its best efforts to
      take, or cause to be taken, all actions and to do, or cause to be done,
      all things reasonably necessary, proper or advisable under all applicable
      Laws to cause each of the conditions to Closing set out in Article 9 to be
      satisfied and to consummate and make effective the Transaction. In case at
      any time after Closing any further action is necessary or

                                       23
<PAGE>

      desirable to carry out the purposes of this Agreement, the Purchaser shall
      use its best efforts to take or cause to be taken any such action.

5.2.  Confidentiality. From the date hereof through and including the Closing
      Date, the Purchaser shall refrain from providing any third parties with
      any Confidential Information whatsoever concerning the Company, other than
      (a) as required by applicable Law or otherwise necessary in relation to
      the Merger Notification or to a courtesy notification to the antitrust
      authorities in the United States, or (b) as necessary to undertake the
      actions specifically contemplated by this Agreement. If this Agreement is
      terminated in accordance with Section 9.4, the Purchaser will, at the
      Seller's option, (a) promptly deliver to the Seller all documents
      furnished to the Purchaser or its representatives by or on behalf of the
      Seller (and all copies thereof) containing Confidential Information or
      destroy the same and send to the Seller written confirmation of such
      destruction and (b) destroy all documents prepared by it or its
      representatives that contain or reflect Confidential Information and send
      to the Seller written confirmation of such destruction; provided, however,
      that the Purchaser may retain one copy of any such document in its files
      for internal recordkeeping and accounting purposes only. Notwithstanding
      the return or destruction of the Confidential Information and the
      termination of this Agreement, the Purchaser and its representatives will
      continue to be bound by this Section 5.2 until the second anniversary of
      the date hereof.

5.3.  Restricted Actions; Board of Directors. During the Initial Earn-out
      Calculation Period and the Extended Earn-out Calculation Period, if
      applicable:

      (a)   the Purchaser shall have the sole authority to manage and operate
            the business of the Company; provided; however, that the Purchaser
            shall ensure that the Company shall not enter into any transactions
            that are not arms' length or that constitute illegal transfer
            pricing;

      (b)   the Purchaser agrees not to take and to prevent the Company from
            taking actions for the primary purpose of adversely affecting the
            Seller's contingent payment rights to the Performance Payment and
            the Earn-out Payment; and

      (c)   the Board of Directors (Conselho de Administracao) of the Company
            shall meet no less frequently than twice per year, to resolve upon
            matters that it is required to act upon by Law. The Purchaser shall
            ensure that all Board members timely receive monthly management
            reports generally consistent with prior practice.

5.4.  Board Member. Until the Remaining Shares Purchase Date, the Seller shall
      have the right to appoint a member to the Board of Directors of the
      Company, such person to be appointed with the consent of the Purchaser,
      which shall not to be unreasonably withheld; it is understood that such
      board position shall entail no executive powers in relation to the Company
      and the member appointed by the Seller shall not be entitled to any
      remuneration in such capacity from the Company.

                                       24
<PAGE>

                                   ARTICLE 6
                             COVENANTS OF THE SELLER

6.1.  Best Efforts Undertaking. The Seller shall use its best efforts to take,
      or cause to be taken, all actions and to do, or cause to be done, all
      things reasonably necessary, proper or advisable under all applicable Laws
      to cause each of the conditions to Closing set out in Article 9 to be
      satisfied and to consummate and make effective the Transaction. In case at
      any time after Closing any further action is necessary or desirable to
      carry out the purposes of this Agreement, the Seller shall use its best
      efforts to take or cause to be taken any such action.

6.2.  Confidentiality and Exclusivity. From the date hereof through and
      including the Closing Date, the Seller shall refrain, and shall cause the
      Company to refrain, from providing any third parties with any information
      whatsoever concerning the Company, other than (a) within the course of the
      Seller's Ordinary Course of Business, (b) as required by applicable Law or
      otherwise necessary in relation to the Merger Notification, or (c) as
      necessary to undertake the actions specifically contemplated by this
      Agreement. During the same period, the Seller shall refrain from
      initiating or continuing, either directly or indirectly, with any Person
      other than the Purchaser, any negotiations concerning the sale of all or
      part of the Shares, or of any part of the business of the Company.

6.3.  Management of the Company. From the date hereof through and including the
      Closing Date, except as expressly and specifically envisioned in this
      Agreement, the Seller shall cause the Company:

      (a)   to take each of the actions described in Section 4.8(b)(i) and not
            to take any of the actions described in Sections 4.8(a)(i) through
            4.8(a)(ii) and Sections 4.8(b)(iii) through 4.8(viii);

      (b)   without prejudice to the generality of the foregoing, not to (i)
            enter into any employment agreement with any Person; (ii) adopt,
            enter into, amend in any material respect, announce any intention to
            adopt or terminate any collective bargaining or similar agreement or
            other employee benefit plan, program or arrangement of general
            applicability; or (iii) make any capital expenditures in excess of
            one hundred thousand euro ((euro) 100,000);

      (c)   not to change the rights granted by the Company collectively to its
            employees as described in Annex 4.19(b), nor grant any additional
            benefit to any of its directors, consultants or employees, with the
            exception of compulsory salary increases made pursuant to the terms
            of any applicable collective bargaining agreement or as otherwise
            required by Law; and

      (d)   to give written notice to the Purchaser of any additional borrowings
            made or funds received under the Government Incentive Contract.

6.4.  Non-competition and Non-solicitation.

      (a)   For three (3) years following the Closing Date, the Seller shall not
            undertake, directly or indirectly, personally or through Affiliates
            or other individuals or entities, whether or not for compensation,
            throughout the territory where the

                                       25
<PAGE>

            Company is active, any activity that might compete with that of the
            Company except for the sale of the Company's products in outlet
            stores owned by the Seller or any of its Affiliates, or cooperate in
            any manner whatsoever with any company that competes with the
            Company; and

      (b)   Except as specifically contemplated by this Agreement, for two (2)
            years following the Closing Date, the Seller shall not employ or
            solicit for employment, either directly or indirectly, employees of
            the Company, or incite any of those employees to leave any position
            they occupy now or in the future with the Company.

6.5.  Employee Notification. The Seller shall not provide any information to
      employee representatives concerning the Purchaser and its plans for the
      Company without the Purchaser's prior written approval.

6.6.  Access and Information. From the date hereof until the Closing, the Seller
      shall cause the Company to grant the Purchaser and its representatives,
      without unduly interfering with the normal operations of the Company,
      access to the books, records, management, consultants, facilities,
      properties and assets of the Company (and those of the Seller to the
      extent that its books, records, management personnel, consultants,
      facilities and assets relate to the Company's business) to enable them to
      conduct such additional audits, reviews, evaluations and investigations as
      the Purchaser may reasonably request. The Seller shall cause the Company
      to produce regular monthly reports on deadlines consistent with historical
      practice and will provide the Purchaser with copies of such reports as
      soon as possible but in no event later than five (5) days after their
      production. At the option of the Purchaser, the Seller shall (and shall
      cause the Company to) assist the Purchaser in preparing a reconciliation
      of the 2003 Financial Statements to U.S. GAAP.

6.7.  Cancellation of Related-Party Contracts and Satisfaction of Debts. Except
      as specifically envisioned by this Agreement, the Seller shall, on or
      before the Closing Date:

      (a)   repay or procure the repayment to the Company of any debt owed to
            the Company, including trade accounts payables, by any of the
            Seller, its Affiliates or any Related Person thereof, including
            interest thereon (if any) through the Closing Date, without any
            penalty for prepayment;

      (b)   terminate or procure the termination of, without any penalty or
            payment by, or Liability (whether due or to become due) to, the
            Company, all Contracts between any of the Seller, its Affiliates or
            any Related Person thereof, on the one hand, and the Company, on the
            other hand; and

      (c)   procure the full release, without any Liability (whether due or to
            become due) to the Company, effective as of the Closing Date, of all
            past, present or future primary or guarantor obligations of the
            Company, in any form whatsoever, including as joint and several
            obligor, that benefit in whole or in part the Seller, its Affiliates
            or any Related Person, on terms reasonably satisfactory to the
            Purchaser, and provide the Purchaser with evidence reasonably
            satisfactory to the Purchaser that the Company has been released
            from its obligations.
<PAGE>

6.8.  Waivers. The Seller shall obtain that, on the Closing Date, all persons
      that have entered into any Contract entitling them to terminate such
      Contract in the event of a change of control of the Company shall have
      waived such right in writing in connection with the transactions provided
      for herein.

6.9.  Assistance with Regard to Relationships. During the Initial Earn-out
      Calculation Period, the Seller shall use reasonable commercial efforts to
      assist the Company in maintaining its relationships with customers,
      government authorities, suppliers, and banks.

6.10. Further Agreements.

      (a)   Until the earlier of the first anniversary of the Closing Date and
            the date on which Mr. Antonio Sa Cunha is no longer employed by the
            Seller or one of its Affiliates, the Seller agrees to make available
            (or to cause its Affiliates to make available) the services of Mr.
            Sa Cunha for twelve (12) hours per month (approximately three (3)
            hours per week) to assist in the financial oversight of the Company.

      (b)   Until the Remaining Shares Repurchase Date and at the option of the
            Purchaser, the Seller shall assist (in a manner reasonably
            consistent with past practice) the Company in negotiations with the
            Glass-Industrial Sector - Cristal Industry (Sector Vidreiro -
            Industria de Cristalaria). Any out-of-pocket expenses incurred by
            the Seller in providing such assistance shall be reimbursed to the
            Seller by the Company.

      (c)   For a period of ninety (90) days following the Closing Date, the
            Seller shall (and shall cause its Affiliates to) provide the Company
            with transitional administrative services, such as human resources
            support, information technology support and the forwarding of
            electronic mail delivered to the Seller's corporate server,
            reasonably required by the Company to allow the Company to conduct
            its business as currently conducted and to facilitate an orderly
            change of control, on such terms as are customary for these types of
            administrative services; provided that the human resources support
            shall correspond to the level of services previously available to
            the Company as was provided by Mr. Arlindo Duarte and Mr. Sousa
            Lopes and the amount the Company shall pay to the Seller for such
            equivalent support shall not exceed the amount that would have been
            paid to Mr. Arlindo Duarte for the same services; and provided
            further that if any costs are imposed by Law on the Company,
            including Social Charges, pensions, employee benefits or severance
            costs, in relation to any person providing transitional
            administrative services, the Seller shall pay all such costs.

6.11. Transfer Pricing File. On or before the Closing Date, the Seller shall
      prepare and deliver to the Purchaser a file documenting and substantiating
      the 2002 and 2003 transactions between the Company and the Seller, the
      Seller's Affiliates and any Related Person, as required under applicable
      Law, including Article 58 of the Portuguese Corporate Income Tax Code.

6.12. Remaining Shares. Until the Remaining Shares Purchase Date, the Seller
      shall hold the Remaining Shares free and clear of any Encumbrances.

                                       27

<PAGE>

6.13. Intellectual Property. The Seller shall take any and all measures
      necessary to ensure that (a) as of the Closing Date, the Company shall
      have the software licensing rights, source codes, maintenance contracts,
      hardware and other assets necessary to operate twenty-five (25) BAAN
      seats, and (b) as soon as possible after the Closing Date, all
      Intellectual Property listed on Annex 4.12(a) is registered in the name of
      the Company with the applicable Governmental Authority.

6.14. Governmental Authorities. The Seller shall use its reasonable commercial
      efforts to assist the Purchaser in negotiating new government incentive
      Contracts after the Closing Date.

6.15. Government Incentive Contract. The Seller shall use its reasonable best
      efforts and proceed in a diligent manner to terminate the Government
      Incentive Contract as soon as possible and to settle the obligations
      thereunder with no continuing obligation or Liability (whether due or to
      become due) for the Company or the Purchaser (or any Affiliate of the
      Purchaser).

6.16. Satisfaction of Indebtedness. The Seller shall cause the Company to have
      no Indebtedness as of the Closing Date other than Indebtedness listed on
      the Government Incentive Contract Statement or the Indebtedness Statement.

6.17. Receipts of Payment. Prior to the Closing Date, the Seller shall provide
      the Purchaser with receipts for all payments made in relation to the
      contracts for the repair of the Company's furnace number 1 and shall
      ensure that the receipts for all payments in relation to the contracts for
      the rebuild of the Company's furnace number 2, as well as the repair of
      any equipment related thereto, are in the Company's possession.

                                   ARTICLE 7
                                 INDEMNIFICATION

7.1.  Indemnification by the Seller. The Seller shall indemnify, defend and hold
      harmless the Company and the Purchaser and its Affiliates and Related
      Persons thereof (an "INDEMNIFIED PARTY") from and against any and all
      Damages that may be imposed on, incurred by or asserted against an
      Indemnified Party as a result of:

      (a)   any breach or inaccuracy of any representation or warranty of the
            Seller hereunder, taking into account any exceptions, disclosures,
            limitations and qualifications of such representation or warranty
            made in the applicable Annex to Article 4;

      (b)   any breach of any covenant, undertaking or agreement of the Seller
            contained in this Agreement, including any document entered into
            pursuant to this Agreement;

      (c)   any Liability of the Seller or the Seller's Affiliates (other than
            the Company) for which an Indemnified Party is liable as joint and
            several obligor or otherwise (excluding any liability that is not
            related to, or does not otherwise arise out of, this Transaction);

      (d)   any Indebtedness of the Company on the Closing Date not reflected on
            the Closing Statement;

                                       28
<PAGE>

      (e)   any Liability of the Company on account of Social Charges, pensions
            or other employee benefits, to any Person who ceased to be an
            employee of the Company before the Closing Date;

      (f)   any claim made by Printglass with respect to retention or similar
            rights over the property listed in Annex 4.10(a) and Section 4.11(c)
            and any claim by employees of Printglass for employment status with
            the Company due to events occurring or circumstances existing on or
            prior to the Closing Date or due to continuing events that started
            on or prior to the Closing Date;

      (g)   any one-time, annual or maintenance fees incurred on or prior to the
            Closing Date and billed retroactively after the Closing Date related
            to the software contracts currently used by the Company; and

      (h)   any claim for Liability in relation to the contract entered into
            between Crisal - Cristais de Alcobaca, SA, and Instituto de Apoio as
            Pequenas e Medias Empresas e ao Investimento, dated June 7, 1996.

7.2.  Indemnification by the Purchaser. The Purchaser shall indemnify, defend
      and hold harmless the Seller and its Affiliates and Related Parties
      thereof (an "INDEMNIFIED PARTY"), from and against any and all Damages
      that may be imposed on, incurred by or asserted against an Indemnified
      Party as a result of:

      (a)   any breach or inaccuracy of any representation or warranty of the
            Purchaser hereunder; and

      (b)   any breach of any covenant, undertaking or agreement of the
            Purchaser contained in this Agreement, including any document
            entered into pursuant to this Agreement.

7.3.  Environmental Matters.

      (a)   Subject to paragraphs (b) and (d) of this Section 7.3, the Seller
            shall indemnify, defend and hold harmless the Purchaser (by way of a
            payment to be made to the Purchaser or the Company, at the
            Purchaser's direction) from and against any and all Damages that may
            be imposed on, incurred by or asserted against the Company as a
            result of any of the following events and circumstances, to the
            extent that they occurred or existed at any time on or before the
            Closing Date:

            (i)   any pollution, contamination or Release that would violate or
                  require remediation under any applicable Law, the source of
                  which is or was any activity of the Company or any property
                  owned, leased, used or operated by it;

            (ii)  any pollution or contamination of any land, premises or
                  facilities owned, leased, used or operated by the Company that
                  would violate or require remediation under any applicable Law;

            (iii) any storage or treatment of dangerous or toxic wastes or
                  substances on land owned, leased, used or operated by the
                  Company in a manner that would violate any applicable Law;

                                       29
<PAGE>

            (iv)  any shipment or transportation of any dangerous or toxic
                  wastes or substances by the Company or at its direction in a
                  manner that would violate any applicable Law;

            (v)   any disposal of wastes by the Company or at its direction in a
                  manner that would violate any applicable Law; and

            (vi)  any failure of the Company to obtain, maintain in full force
                  for the operation of the Company's business, submit timely
                  renewal applications for and comply with all Permits required
                  under applicable Environmental Laws.

      (b)   The Seller shall be obligated to make indemnification payments for
            claims arising out of the matters set out in this Section 7.3 only
            if the aggregate amount of such claims exceeds one hundred
            seventy-five thousand euro ((euro) 175,000); provided that, in the
            event this threshold is exceeded, the full amount of all such Claims
            shall be indemnified; provided, however, that the Seller shall be
            obligated to make indemnification payments for any and all amounts
            relating to Proceedings, including any costs of remediation,
            initiated on or before the Closing Date.

      (c)   No disclosure by the Seller or any other Person, whether in this
            Agreement or otherwise, pertaining to the matters set out in Section
            7.3(a), shall qualify or limit the Seller's obligations under this
            Section 7.3.

      (d)   The Purchaser shall not make any claim to the Seller regarding the
            cost of the installation of air emissions equipment with respect to
            the Company's furnaces nor claim from the Seller any Damages which
            may have resulted from the failure by the Purchaser or the Company
            to apply after the Closing Date the amount of two hundred fifty
            thousand euro ((euro) 250,000) referred to in Section 1.2(a)(i) to
            the acquisition and installation of such environmental equipment,
            including any Damages resulting from emissions after the Closing
            Date from these furnaces.

7.4.  Notification and Payment of Claims. All claims made by an Indemnified
      Party hereunder (a "CLAIM") shall be made in writing in a notice (a "CLAIM
      NOTICE") to the Seller or the Purchaser, as applicable (the "INDEMNIFYING
      PARTY"), providing in sufficient detail the reasons for the claim and the
      amount to be indemnified, if it may be determined, or an estimate thereof
      (which estimate shall not be conclusive of the final amount of the Claim).
      If the Indemnifying Party does not notify any objection to the Claim to
      the Indemnified Party within thirty (30) days of the Indemnifying Party's
      receipt of a Claim Notice, the related indemnification shall become due
      and payable. If the Indemnifying Party notifies an objection to the Claim
      to the Indemnified Party within thirty (30) days of the Indemnifying
      Party's receipt of a Claim Notice, the parties shall settle the Claim in
      accordance with Article 10.

7.5.  Third Party Claims.

      (a)   In the event a Claim is made as a result of or in connection with a
            Proceeding instituted by a third party (a "THIRD PARTY CLAIM"), the
            Indemnified Party shall send to the Indemnifying Party a copy of the
            related claim notice (a

                                       30
<PAGE>

            "THIRD PARTY CLAIM NOTICE") promptly; provided, however, that any
            delay in sending such a Third Party Claim Notice shall not result in
            the Indemnified Party forfeiting any right hereunder, but may result
            only in the payment of Damages to the Indemnifying Party, to the
            extent that the Indemnifying Party establishes that such delay has
            actually prejudiced its defense against such Third Party Claim.

      (b)   The Indemnifying Party may notify the Indemnified Party of its
            decision to participate in the defense of any Third Party Claim
            within fifteen (15) days after receipt of the related Third Party
            Claim Notice; provided, however, that such period may be shortened
            at the Indemnified Party's reasonable request in order to comply
            with any applicable procedural deadlines. If the Indemnifying Party
            does not notify the Indemnified Party of such decision within such
            period, it shall be deemed to have waived its right to participate
            in the defense of such Third Party Claim. Any such waiver shall
            authorize the Indemnified Party to defend against such Third Party
            Claim as it sees fit, and in particular to enter into any
            settlements, agreements or withdrawals, without prejudice to its
            right to indemnification hereunder.

      (c)   If the Indemnifying Party notifies the Indemnified Party of its
            intent to participate in the defense of a Third Party Claim within
            the time period referred to in Section 7.5(b), and if the
            Indemnifying Party acknowledges in writing that it is liable
            hereunder for any Damages resulting from such Third Party Claim, the
            Indemnified Party shall not, and shall cause its respective
            Affiliates not to, enter into any settlement, agreement or
            withdrawal in connection with such Third Party Claim without the
            Indemnifying Party's prior consent, not to be unreasonably withheld.

      (d)   Regardless of whether the Indemnifying Party chooses to participate
            in the defense of a Third Party Claim:

            (i)   the Indemnified Party shall allow the Indemnifying Party
                  reasonable access to information and documents relating
                  thereto; and

            (ii)  the Indemnified Party shall invite the Indemnifying Party to
                  participate, at the Indemnifying Party's expense, in all major
                  phases of the proceedings and, without prejudice to Section
                  7.5(c), in any strategic decisions to be taken in connection
                  with the defense against such Third Party Claim.

      (e)   The Indemnifying Party shall not enter into any settlement,
            agreement or withdrawal in connection with any Third Party Claim
            that would impose obligations on the Indemnified Party without the
            Indemnified Party's prior written consent, not to be unreasonably
            withheld.

7.6.  Determination of the Indemnification Amount. Any indemnification payable
      hereunder shall be equal to the entire amount of the Damages, subject to
      the following:

      (a)   Any reassessment made by the Tax authorities, the sole consequence
            of which is to shift a deductible or a taxable element from one
            fiscal year to another,

                                       31
<PAGE>

            shall give rise to indemnification only to the extent of the
            resulting effective Damages sustained by the Company, if any,
            including, without limitation, penalties, interest, and increases in
            Tax liability resulting from differing applicable Tax rates or the
            transfer of a taxable element from a loss-making to a profit-making
            year.

      (b)   The provisions of Sections 7.7 through 7.10, 7.12 and 7.13
            hereunder.

7.7.  Threshold. Subject to Section 7.10, the Seller shall not be obligated to
      make any indemnification payment if the aggregate amount of the Claims
      made by the Purchaser does not exceed four hundred thousand euro ((euro)
      400,000), provided that, in the event this threshold is exceeded, the full
      amount of all Claims shall be indemnified in accordance with this Article
      7.

7.8.  Deductible. Subject to Section 7.10, no indemnification shall be paid in
      connection with any Claim for an amount less than fifteen thousand euro
      ((euro)15,000), and in any case only for the excess of any such Claims
      over that amount; provided, however, that when the total of such Claims
      equals or exceeds seventy-five thousand euro ((euro)75,000), such
      deductible shall no longer apply and the Seller shall pay indemnification
      for the full amount of all additional Claims, subject to Sections 7.7 and
      7.9 and provided further that the Seller shall have no liability for
      Claims for an amount less than one thousand five hundred euro
      ((euro)1,500). A series of Claims having the same cause shall be
      considered together as one Claim for the purposes of this Section 7.8.

7.9.  Maximum Amount. Subject to Section 7.10, the Seller shall not be obligated
      to make any indemnification payment relating to Claims under Section 7.3
      for any amount in excess of thirty percent (30%) of the sum of (a) the
      Initial Payment (before the subtraction of any amounts relating to the
      Government Incentive Contract or other Indebtedness pursuant to Section
      1.2(a)(i)), (b) to the extent such payment has been made or is due at the
      time the indemnification is payable, the Deferred Payment or the
      Performance Payment, as applicable, and (c) to the extent such payment has
      been made or is due at the time the indemnification is payable, the
      Earn-out Payment (the sum of such payments, the "TOTAL PAYMENT AMOUNT");
      provided that the Total Payment Amount shall be recalculated and applied
      retroactively if the Deferred Payment, Performance Payment and/or Earn-out
      Payment becomes due at a later date. Moreover, and subject to Section
      7.10, the Seller shall not be obligated to make any indemnification
      payments relating to Claims, other than Claims under Section 7.3, for
      amounts which would exceed twenty-five percent (25%) of the Total Payment
      Amount. For the avoidance of doubt, the aforesaid indemnification limits
      of thirty percent (30%) and twenty-five percent (25%) shall not be
      cumulative and indemnification will be limited to thirty percent (30%) or
      twenty-five (25%), as the case may be.

7.10. Exceptions to Limitations on Indemnification.

      (a)   Sections 7.7, 7.8 and 7.9 shall not apply to Claims arising out of:

            (i)   breaches of the Seller's representations under Sections
                  4.1(a), 4.1(b), 4.1(c), 4.1(d), 4.1(e), 4.2, 4.3(a), 4.4, or
                  4.21;

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<PAGE>

            (ii)  breaches of the Seller's covenants and agreements set out in
                  Sections 6.4(a), 6.12, 8.8 and 8.9.

            (iii) the matters set out in Sections 7.1(c), 7.1(d), 7.1(e), and
                  7.1(h).

      (b)   Sections 7.7 and 7.8 shall not apply to the Claims arising out of
            the matters set out in Section 7.3 (subject, for the avoidance of
            doubt, to Section 7.3(b)).

7.11. Interest. Any amounts due under this Article 7 shall automatically bear
      interest at a rate per annum equal to EURIBOR for three (3) month
      interbank loans plus two and a half percent (2.5%) calculated on the basis
      of a three hundred sixty-five (365) day year and the actual number of days
      elapsed, from the thirtieth (30th) day after the Indemnifying Party's
      receipt of the first request for payment of such amount.

7.12. Deadlines for Claims.

      (a)   Any Claim for breach of a representation or warranty under Section
            7.1(a) shall give rise to indemnification only to the extent that
            the Indemnified Party notifies it to the Seller before the
            expiration of a two-year period from the Closing Date; provided,
            however, that Claims related to Tax and Social matters can be made
            until the expiration of a one (1) month period after the expiration
            of the relevant statute of limitations.

      (b)   Any Claims for breach of Section 7.3 can be made until December 31,
            2012.

7.13. Release. The Seller shall not be released from any obligations under this
      Article 7 as a result of (a) any knowledge that the Purchaser has or may
      have had of such events, facts or circumstances, as a result, in
      particular, of any investigations made by the Purchaser, its
      representatives or its counsel, or (b) the approval of the yearly accounts
      of the current fiscal year by the shareholders' meeting of the Company.

7.14. Duty to Mitigate. The Indemnified Party shall take reasonable steps to
      mitigate the Damages under a Claim.

                                   ARTICLE 8
                               FURTHER AGREEMENTS

8.1.  Merger Notification. The Purchaser shall be responsible for the Merger
      Notification. The Seller shall cooperate with the Purchaser in the
      preparation of all forms, reports and information required in connection
      with the Merger Notification and will deliver in due time and in an
      expeditious manner all the documentation and information required for the
      Merger Notification and such other information and documentation that,
      from time to time, may be deemed necessary and/or requested by the
      competition authorities.

8.2.  Employee Issues. Within four (4) months of the Closing Date, the Purchaser
      shall have the right, at its sole discretion, to give the Seller notice of
      its intention to terminate the employment of any employee listed in ANNEX
      8.2, and the Seller shall negotiate with such employee to obtain the
      employee's agreement to transfer his or her employment to the Seller or an
      Affiliate of the Seller. If the Seller is unable to obtain the consent of
      such employee for such transfer within fifteen (15) days of such

                                       33
<PAGE>

      notice, the Purchaser may terminate the employment of such employee and
      the Seller shall pay all amounts relating to the termination, including
      without limitation, any severance costs required by Law or by Contract
      provisions in effect as of the Closing Date, including Social Charges,
      pensions, and employee benefits.

8.3.  Outlet Stores. On or before the Closing Date, the lease between the Seller
      and the Company relating to the outlet store located on the Company's
      property shall be terminated, all assets at the store, including
      equipment, fixtures and inventory used for its operation in the ordinary
      course consistent with past practice, shall be owned by the Company, and
      the five employees listed on ANNEX 8.3 employed in the conduct of the
      outlet store activities shall have been employed by the Company. The
      Purchaser and the Seller shall (or, as applicable, the Seller shall cause
      its Affiliates to) enter into (i) a commercial relationship providing for
      the Company to sell the products of the Seller and/or its Affiliates in
      the outlet store located on the Company's property on commercially
      reasonable terms and (ii) a commercial relationship providing for the
      Seller and/or its Affiliates, as applicable, to sell the Company's
      products in all outlet stores owned by the Seller or its Affiliates on the
      same terms and conditions as those currently in place.

8.4.  Historical Data on BAAN. Until the expiration of the relevant statute of
      limitations, the Purchaser shall cause the Company to use its best efforts
      to retain, either on the BAAN systems or on downloaded flat files, the
      historical data of the Seller that is stored as of the Closing Date on the
      BAAN systems that are transferred from the Seller to the Company pursuant
      to Section 6.13, and to provide the Seller and its Affiliates with
      assistance in recovering such data; provided, that the -------- Seller, or
      its Affiliates, as applicable, shall provide the Company with reasonable
      notice of its or their data retrieval needs and the Company shall not be
      required to incur unreasonable cost in fulfilling such requests, nor shall
      it be obligated to provide more than eight (8) hours of service per month
      without charge. The Seller shall pay to the Company an hourly rate of
      fifteen euro ((euro)15) per hour for time spent by the Company's employees
      on data retrieval in excess of eight (8) hours per month. The Company
      shall have the right, in its sole discretion, to discontinue using BAAN,
      without prejudice to the Purchaser's and the Company's rights and
      obligations hereunder.

8.5.  Supply of Non-Soda Lime Glassware and Ceramic Products. The Parties shall
      enter into a commercial relationship under which the Seller shall sell to
      the Company non-soda lime glassware, crystal and ceramic products.

8.6.  IVIMA Warehouse. The Seller shall allow (or, as applicable, cause its
      Affiliates to allow) the Company to use the warehouse at the IVIMA
      facility in the same manner in which the Company has historically used
      such warehouse for a period of six (6) months from the date hereof,
      without charge.

8.7.  Cancellation and Replacement of Guarantees. The Seller (and its
      Affiliates) shall be entitled to cancel any guarantees, sureties,
      warranties and credit support agreements listed on Annex 4.15 given by the
      Seller (or any of its Affiliates) for the benefit of the Company; provided
      that the Seller either (i) notifies the Purchaser of its intention to
      cancel any such guarantee, surety, warranty or credit support on or before
      the Closing Date, in which case the Purchaser shall (or shall cause an
      Affiliate to) replace any such guarantee, surety, warranty or credit
      support as soon as possible after the Closing Date and the cancellation
      shall only become effective as of the date of replacement, or

                                       34
<PAGE>

      (ii) notifies the Purchaser of its intention to cancel any such guarantee,
      surety, warranty or credit support at such later date as the Seller may
      elect in its sole discretion, provided that the Seller notifies the
      Purchaser thirty (30) days or more in advance, in which case the
      cancellation shall become effective as of such later date elected by the
      Seller.

8.8.  Government Incentive Contract.

      (a)   Reduction of Non-reimbursable Loans (incentivos nao reembolsaveis)

            (i)   If, after the Closing Date but before the date on which the
                  Closing Statement becomes final, either (a) the Company is
                  required to reimburse to the relevant Governmental Authority
                  any amounts that were characterized as non-reimbursable loans
                  (incentives nao reembolsaveis) on the Government Incentive
                  Contract Statement, or (b) such Governmental Authority
                  otherwise requires the Company to pay any amounts (including
                  interest, fees or penalties) in excess of those included in
                  Section 1.2(a)(i)(a), then the amount that has been
                  recharacterized or that the Company must pay shall be treated
                  as Closing Indebtedness for purposes of the Closing Statement.

            (ii)  If, on or after the date on which the Closing Statement
                  becomes final, either (a) the Company is required to reimburse
                  to the relevant Governmental Authority any amounts that were
                  characterized as non-reimbursable loans (incentives nao
                  reembolsaveis) for purposes of the Closing Statement, or (b)
                  such Governmental Authority otherwise requires the Company to
                  pay any amounts (including interest, fees or penalties) in
                  excess of those included as Indebtedness in the Closing
                  Statement, then the amount that has been recharacerized or
                  that the Company must pay shall be treated as a post-Closing
                  adjustment to the Closing Indebtedness and the Seller shall
                  pay such amount to the Company within five (5) days of
                  receiving notice from the Company that such amount is due.

      (b)   Additional Non-reimbursable Loans (incentivos nao reembolsaveis)

            (i)   If, after the Closing Date but before the date on which the
                  Closing Statement becomes final, either (a) the relevant
                  Governmental Authority characterizes any amount that was
                  treated as reimbursable loans (incentivos reembolsaveis) on
                  the Government Incentive Contract Statement as
                  non-reimbursable loans (incentivos nao reembolsaveis) under
                  the Government Incentive Contract, or (b) the Company receives
                  from such Governmental Authority in the form of cash any
                  non-reimbursable loans (incentivos nao reembolsaveis) under
                  the Government Incentive Contract that was not included in the
                  Government Incentive Contract Statement, then the amount that
                  has been recharacterized or received shall be treated as
                  Closing Cash for purposes of the Closing Statement.

            (ii)  If, on or after the date on which the Closing Statement
                  becomes final, either (a) the relevant Governmental Authority
                  characterizes any

                                       35
<PAGE>

                  amount that was treated as reimbursable loans (incentivos
                  reembolsaveis) for purposes of the Closing Statement as
                  non-reimbursable loans (incentivos nao reembolsaveis) under
                  the Government Incentive Contract, or (b) the Company receives
                  from such Governmental Authority in the form of cash any
                  non-reimbursable loans (incentivos nao reembolsaveis) under
                  the Government Incentive Contract, then the amount that has
                  been recharacterized or received shall be treated as a
                  post-Closing adjustment to the Closing Cash and the Purchaser
                  shall pay such amount to the Seller within five (5) days of
                  receiving or being credited such amount from the relevant
                  Governmental Authority.

      (c)   Late payments under this Section 8.8 shall bear interest at a rate
            per annum equal to EURIBOR for three (3) month interbank loans plus
            two and a half percent (2.5%) calculated on the basis of a three
            hundred sixty-five (365) day year and the actual number of days
            elapsed, from the date such payment was due.

8.9   Payments for Furnace Repair. If the Company receives any bills or invoices
      associated with the repair of furnace number 1 due to the events having
      occurred prior to the date hereof for amounts not listed on a statement
      showing the Initial Payment calculation to be provided by the Seller on
      the Closing Date, the Company shall promptly notify the Seller of any
      bills or invoices it receives after the Closing Date related to such
      repair, and the Seller shall pay to the Company such amounts concurrently
      with the time at which they become due to third parties. The Seller shall
      be entitled to any insurance proceeds collected by the Company from its
      insurers in relation thereto. The Company shall pay the Seller an amount
      equal to proceeds received from the insurance company relating to such
      repair as soon as possible, but in no event later than five (5) days,
      after the Company is aware that they have been received.

                                   ARTICLE 9
                       CONDITIONS TO CLOSING; TERMINATION

9.1.  Conditions to Each Party's Obligations. Each Party's obligation to
      consummate the Transaction contemplated hereby at the Closing is subject
      to the fulfillment to each Party's satisfaction on or before the Closing
      Date of each of the following conditions:

      (a)   Approvals and Consents. All Consents required for the consummation
            of the Transaction or for preventing the termination of any material
            Permit, Contract, Consent or other right of the Company upon the
            consummation of the Transaction shall have been obtained in writing
            and shall be in full force and effect on the Closing Date.

      (b)   No judgment. No Judgment or Law shall be in effect preventing or
            imposing any materially adverse conditions on the consummation of
            the Transaction.

      (c)   No proceedings. No Proceeding that seeks, or may seek to prevent, or
            questions the validity or legality of the Transaction shall be
            pending or, to the extent that there is a reasonable basis for such
            threat, threatened as of the Closing Date, and no Person shall have
            given any notice, made any claim or

                                       36
<PAGE>

            submitted any other communication to any Party threatening any such
            Proceeding or otherwise seeking to prevent or questioning the
            validity or legality of the Transaction.

9.2.  Conditions to the Purchaser's Obligations. The Purchaser's obligation to
      consummate the Transaction on the Closing Date is subject to the
      fulfillment of each of the following conditions, to its reasonable
      satisfaction, on or before the Closing Date. These conditions are for the
      exclusive benefit of the Purchaser, which may waive such conditions, in
      whole or in part, in writing at any time before the Closing.

      (a)   Representations and Warranties. The representations and warranties
            of the Seller set out in this Agreement shall be true and correct in
            all material respects on the date or dates as of which such
            representations and warranties are made.

      (b)   Performance. The Seller and the Company shall have performed or
            complied with each covenant, agreement and condition set out in this
            Agreement that it is to perform or comply with on or before the
            Closing Date.

      (c)   No Material Adverse Effect. The Company shall not have undergone or
            suffered, between the date hereof and the Closing Date, any change
            in its financial condition, income, properties, Liabilities (whether
            due or to become due) or operations that has been, or could
            reasonably be expected to be, individually or in the aggregate,
            materially adverse to the Company.

      (d)   Contractual Waivers. The Seller shall have delivered to the
            Purchaser evidence reasonably satisfactory to it of the waiver of
            any right to terminate any Contract listed in Annex 4.15 by the
            third party or parties entitled to such right to terminate such
            Contract under applicable change in control provisions.

      (e)   Outlet Store. The lease relating to the outlet store located on the
            Company's property shall have been terminated and the assets at the
            outlet store shall be owned by the Company in accordance with
            Section 8.3.

      (f)   Furnace Repair. The Seller shall have delivered to the Purchaser a
            statement from Nikolaus Sorg GmbH & Co. KG confirming that the work
            relating to the repair has been completed satisfactorily and
            consistent with commercial standards.

9.3.  Conditions to the Seller's Obligations. The Seller's obligation to sell
      and transfer the Original Shares on the Closing Date is subject in
      addition to the fulfillment of each of the following conditions, to its
      reasonable satisfaction, on or before the Closing Date. These conditions
      are for the exclusive benefit of the Seller, which may waive such
      conditions, in whole or in part, in writing at any time before the
      Closing:

      (a)   Representations and Warranties. The representations and warranties
            of the Purchaser set out in this Agreement shall be true and correct
            in all material respects on the date or dates as of which such
            representations and warranties are made.

                                       37
<PAGE>

      (b)   Performance. The Purchaser shall have performed or complied with
            each covenant, agreement and condition set out in this Agreement
            that it is to perform or comply with on or before the Closing Date.

      (c)   Guarantee Letter. The Purchaser shall have obtained and delivered to
            the Seller a guarantee letter from Libbey Inc. in the form attached
            as Annex 2.2(c).

9.4.  Termination. If all the conditions set forth in this Article 9 are not met
      or waived on or before January 31, 2005, or such later date on which the
      Parties may agree in writing, any Party may terminate this Agreement and
      the transactions contemplated hereby, at any time after such date and with
      immediate effect, in which case no compensation or indemnification, except
      as specifically provided for under this Agreement, shall be owed by either
      Party to the other.

                                   ARTICLE 10
                                  MISCELLANEOUS

10.1. Arbitration. Any disputes that may arise out of or in connection with this
      Agreement shall be settled finally and exclusively by arbitration by a
      single arbitrator appointed and proceeding in accordance with the Rules of
      Arbitration of the International Chamber of Commerce. The arbitration
      tribunal shall be located in Paris, France.

10.2. Language. All submissions and awards in relation to arbitration under this
      Agreement shall be made in English and all arbitration proceedings and all
      pleadings shall be in English.

10.3. Waiver; Enforcement. Any award made pursuant to this Article 10 shall be
      final and not subject to appeal. The Parties hereby waive all challenges
      to any such award. Any Party may present any such award in any court of
      competent jurisdiction for enforcement. In any such enforcement action,
      regardless of location, no Party will (and the Parties hereby waive any
      right to) seek to invalidate or modify the decision of the arbitrators or
      otherwise to invalidate or circumvent the procedures set out in this
      Article 10. The Parties understand and agree that this Article 10 may be
      specifically enforced by injunction or otherwise in any court of competent
      jurisdiction.

10.4. Right to Set-off. Any amount payable by one Party to the other Party under
      this Agreement that is not disputed by the other Party or that is the
      result of an arbitration proceeding in accordance with this Article 10 may
      be set off against any amount owed to such Party by such other Party under
      this Agreement that itself is not disputed by the other Party or that is
      the result of an arbitral or judicial process.

                                   ARTICLE 11
                           INTERPRETATION; DEFINITIONS

11.1. Headings. The Article headings in this Agreement are for convenience of
      reference only and shall not be deemed in themselves to have any
      contractual value or particular interpretation.

                                       38
<PAGE>

11.2. Definitions. As used in this Agreement, the following terms shall have the
      following meanings:

      "2003 FINANCIAL STATEMENTS" has the meaning given to it in Section 4.7(a).

      "2004 FINANCIAL STATEMENTS" has the meaning given to it in Section 4.7(b).

      "AFFILIATE" means, with respect to any Person, any other Person that
      directly or indirectly through one or more intermediaries controls, is
      controlled by, or is under common control with such Person. As used in
      this definition of Affiliate, "control" shall mean (a) the direct or
      indirect ownership of more than fifty percent (50%) of the total voting
      securities or other evidences of ownership interest of such Person, or (b)
      the possession, direct or indirect, 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" has the meaning given to it in the preamble hereto and shall
      be deemed to include all Annexes hereto.

      "API" means Agencia Portuguesa para o Investimento.

      "APPLIED ON A CONSISTENT BASIS" or "CONSISTENT BASIS" means, with respect
      to the Company, except as otherwise herein provided, prepared using the
      same accounting principles, policies, standards, practices and estimates
      consistently used by the Company in prior periods and as used in the
      preparation of the Company's most recent audited financial statements.

      "BUSINESS DAY" means a day on which commercial banks and foreign exchange
      markets settle payments and are open for general business (including
      dealings in foreign exchange and foreign currency deposits) in New York
      and Lisbon.

      "CLAIM" has the meaning given to it in Section 7.4.

      "CLAIM NOTICE" has the meaning given to it in Section 7.4.

      "CLOSING" has the meaning given to it in Section 2.1.

      "CLOSING CASH" means the sum of the Company's cash on hand (including cash
      in immediately available funds) and amounts credited to the Company's bank
      accounts as of the end of the day on the Closing Date (but excluding any
      amounts that were credited but become uncollectible prior to the date on
      which the Closing Statement becomes final).

      "CLOSING DATE" has the meaning given to it in Section 2.1.

      "CLOSING INDEBTEDNESS" means the total amount of Indebtedness of the
      Company as of the end of the day on the Closing Date.

      "CLOSING STATEMENT" has the meaning given to it in Section 1.4(a).

      "COMPANY" has the meaning given to it in the recitals hereto.

                                       39
<PAGE>

      "CONFIDENTIAL INFORMATION" means information concerning the business of
      the Company (whether prepared by the Seller, the Company or otherwise and
      irrespective of the form any such information is documented and
      communicated) which has been or is furnished to the Purchaser, its
      representatives or its professional advisers by or on behalf of the
      Seller, including all notes, analyses, compilations, studies,
      interpretations or other documents prepared by the Purchaser or its
      representatives that contain or reflect in whole or in part, the
      information furnished to the Purchaser, its representatives or its
      professional advisers by or on behalf of the Seller; provided, however,
      that Confidential Information does not include information which (i) is or
      becomes available to the public other than as a result of a disclosure by
      the Purchaser, its representatives or its professional advisers (or any
      one of them), (ii) the Purchaser is able to establish was in its or any of
      its representatives' or professional advisers' possession prior to it
      being furnished by or on behalf of the Purchaser pursuant thereto, (iii)
      becomes available to the Purchaser or any of its representatives or
      professional advisers on a non-confidential basis from a source other than
      the Seller, the Company or any of their representatives, provided that to
      the Purchaser's knowledge such source is not bound by a confidentiality
      agreement with or to the Seller or any other party with respect to such
      information, or (iv) is developed by the Purchaser or any of its
      representatives or professional advisers independently of information
      provided by or on behalf of the Seller.

      "CONTINGENCY PAYMENT STATEMENT" has the meaning given to it in Section
      1.3(d).

      "CONSENT" means any consent, waiver, approval, positive advice,
      authorization, exemption, registration, license or declaration of or by,
      or filing with, any Person.

      "CONTRACT" means any agreement, contract, commitment or undertaking,
      whether or not in writing, to which the Company is a party or made by or
      given to the Company.

      "DAMAGES" means all Liabilities, penalties, expenses, fees or actual
      losses suffered by any party (including reasonable attorney's fees), in
      each case after the application of any amounts recovered by that Party,
      directly or indirectly, under insurance contracts or similar arrangements
      (other than amounts recovered under such contracts or arrangements the
      premiums of which are adjusted by an amount equal to any proceeds paid),
      and after subtraction of any amounts recovered from third parties by the
      damaged party, directly or indirectly.

      "DECLARATION" means the consent of API, which is required under the
      Government Incentive Contract, to the transfer to the Purchaser of the
      capital stock in the Company held by the Seller.

      "DEFERRED PAYMENT" has the meaning given to it in Section 1.2(c).

      "EARN-OUT PAYMENT" has the meaning given to it in Section 1.3(a).

      "EBITDA" means , with respect to any period, net income for such period,
      plus interest, taxes (as determined below), depreciation and amortization
      that would have been deducted in determining net income for such period,
      subject to the following:

                                       40
<PAGE>

      (a)   Provisions for doubtful receivables, excess and obsolete inventory
            and other risks and charges, all as recorded in general ledger
            account 67 to 679, shall not be deducted in determining net income.

      (b)   Extraordinary costs and expenses unrelated to the normal operations
            of the Company, including costs for restructuring and severance
            payments to former employees and other costs and expenses, all as
            recorded in general ledger accounts 69 through 698, shall not be
            deducted in determining net income.

      (c)   Extraordinary income and gains unrelated to the normal operations of
            the Company, including amortization of provisions and gains on the
            sale of operating assets of the Company, and other income and gains,
            all as recorded in general ledger accounts 79 through 798, shall not
            be included in determining net income.

      (d)   For purposes of the definition of EBITDA, taxes shall be the amount
            recorded in general ledger account 861.

      (e)   For purposes of the definition of EBITDA, interest shall include
            other costs and financial expenses, as recorded in general ledger
            accounts 68 through 688, reduced by income and financial gains as
            recorded in general ledger accounts 78 through 788.

      (f)   Notwithstanding the foregoing, EBITDA shall not include income or
            loss of Printglass or any other Person acquired by the Company after
            the Closing Date, whether recognized by the Company through
            recording equity earnings, dividend distributions or consolidation
            accounting.

      (g)   Notwithstanding the foregoing, the Parties agree that, in relation
            to Claims for indemnification by the Purchaser or the Company (or
            their Affiliates) to the Seller (or its Affiliates),

            (i)   for amounts relating to such Claims that are accepted by the
                  Seller (i.e., Claims that are not in dispute), any amounts
                  paid by the Purchaser or the Company shall be deducted in
                  determining net income and any amounts received by the
                  Purchaser or the Company from the Seller (or its Affiliates)
                  shall be included in determining net income;

            (ii)  for amounts relating to such Claims that are disputed by the
                  Seller, such amounts shall only be deducted in determining net
                  income if (x) the indemnification Claims arise from Third
                  Party Claims, assessments or directives relating to Tax or
                  environmental issues, and (y) such amounts in the aggregate
                  equal or exceed six hundred thousand euro ((euro)600,000)
                  during a calendar year in the case of the Initial Earn-out
                  Calculation Period or during a consecutive four (4) quarter
                  period during the Extended Earn-out Calculation Period, in
                  which case the total amount of such Claims shall be deducted;

            (iii) the Purchaser shall not be entitled to deduct internal costs
                  relating to any indemnification Claim; provided, however, for
                  the avoidance of doubt, that the Purchaser shall be entitled
                  to deduct legal counsel fees,

                                       41
<PAGE>

                  expert fees (subject to the Seller's consent to retaining such
                  expert, not to be unreasonably withheld), court fees and other
                  related third party expenses; and

            (iv)  any amounts deducted from or added to net income under this
                  Section (g) shall only be deducted or added one time;
                  provided, however, that if such addition or deduction is made
                  during the Extended Earn-out Calculation Period, it shall be
                  included in the calculations for four (4) consecutive four (4)
                  quarter periods.

      "EBITDA START DATE" has the meaning given to it in Section 1.3(a)(iv).

      "ENCUMBRANCE" means any mortgage, security interest, lien, pledge, claim,
      right of first refusal, right to use or occupy, option, charge, covenant,
      lease, order, Judgment, settlement, attachment or any other similar
      restriction, except as fairly disclosed under relevant annexes to this
      Agreement, and actually affecting title to the assets or rights related
      thereto and their economic value.

      "ENVIRONMENT" means soil, land surface or subsurface strata, surface
      waters (including navigable waters, ocean waters, streams, ponds, drainage
      basins and wetlands), groundwaters, drinking water supply, stream
      sediments, ambient air (including indoor air), plant and animal life, and
      any other environmental medium or natural resource.

      "ESCROW AGENT" means Bilbao Viscaya Bank.

      "EXTENDED EARN-OUT CALCULATION PERIOD" has the meaning given to it in
      Section 1.3(a)(ii)(a).

      "FINANCIAL STATEMENTS" has the meaning given to it in Section 4.7(b).

      "GOVERNMENTAL AUTHORITY" means any government or governmental or
      regulatory body or political subdivision thereof (or similar body),
      whether supranational, federal, state, local or foreign, or any agency or
      instrumentality thereof, or any court or arbitrator (public or private).

      "GOVERNMENT INCENTIVE CONTRACT" means the contract listed on Annex 4.17
      entered into between the Company, the Seller and API, dated July 14, 2003.

      "GOVERNMENT INCENTIVE CONTRACT STATEMENT" has the meaning given to it in
      Section 1.2(b)(i).

      "INDEBTEDNESS" means, in each case as determined under Portuguese GAAP,
      any: (i) amounts borrowed from any Person, whether or not under normal
      commercial lending terms or upon the issue of bills, bonds or notes
      (including, for the avoidance of doubt, all amounts borrowed under the
      Government Incentive Contract and all balances between the Company and the
      Seller or its Affiliates); (ii) monetary Liabilities (whether due or to
      become due) under financial leases (other than financial leases relating
      to vehicles, including trucks); (iii) monetary Liabilities (whether due or
      to become due) in connection with receivables sold or discounted; (iv)
      monetary Liabilities (whether due or to become due) under foreign exchange
      contracts and all derivative instruments (including, without limitation,
      any interest or currency

                                       42
<PAGE>

      protection, hedging or financial future transactions); (v) monetary
      Liabilities (whether due or to become due) under the Plan; and (vi)
      accrued interest, prepayment penalties or other costs of discharge
      relating to the matters set out in clauses (i) through (v).

      "INDEBTEDNESS STATEMENT" has the meaning given to it in Section
      1.2(b)(ii).

      "INDEMNIFIED PARTY" has the meaning given to it in Sections 7.1 and 7.2.

      "INDEMNIFYING PARTY" has the meaning given to it in Section 7.4.

      "INDEPENDENT ACCOUNTANT" means a member firm of Pricewaterhouse Coopers
      International Limited or such other accountant on which the Parties may
      agree in writing.

      "INITIAL EARN-OUT CALCULATION PERIOD" has the meaning set forth in Section
      1.3(a)(i)(a).

      "INITIAL PAYMENT" has the meaning given to it in Section 1.2(a)(i).

      "INTELLECTUAL PROPERTY RIGHTS" means any patents, trademarks, trade names,
      designs, copyrights and other similar industrial or intellectual property
      rights.

      "IVIMA" means Nova IVIMA - Industria do Vidro, SA.

      "JUDGMENT" means any judgment, order, injunction, ruling, award or
      administrative act of any court, arbitrator, judicial or administrative
      authority or other Governmental Authority.

      "LAW" means any statute, act, law, directive, code, regulation, rule,
      order, decision or Judgment of any Governmental Authority.

      "LIABILITY" means any liability or obligations of any nature, whether
      known or unknown, accrued, absolute, contingent or otherwise, upon it
      becoming due (except as otherwise specifically provided herein).

      "MERGER NOTIFICATION" means the notification of the Transaction
      contemplated under this Agreement to the relevant authorities in Brazil
      under applicable Laws.

      "NET SALES" means, with respect to any period, the amount invoiced during
      such period to customers for products and services (net of Value Added
      Tax), less deductions allowed or accrued for discounts, returns, price and
      quality differences, and annual bonus incentive programs (rappel), in each
      case as recorded in general ledger accounts 71 through 729.

      "ORDINARY COURSE OF BUSINESS" means (i) the usual, regular and ordinary
      course of the business conducted by the Company consistent with past
      practice and custom, and (ii) all transactions being conducted on an arm's
      length basis.

      "ORIGINAL SHARES" has the meaning given to it in Section 1.1(a)(i).

      "PARTY" and "PARTIES" have the meanings given to them in the preamble
      hereto.

                                       43
<PAGE>

      "PERFORMANCE PAYMENT" has the meaning given to it in Section 1.2(c).

      "PERMIT" means any permit, license or similar instrument, in each case as
      required for the Company to carry out in all material respects its
      business substantially as currently conducted.

      "PERMITTED ENCUMBRANCES" means (i) liens for Taxes not yet due, (ii)
      warehousemen's, mechanics', carriers', landlords', employees', repairmen's
      or similar liens imposed by applicable Law, created in the Ordinary Course
      of Business and for amounts not yet due and payable, (iii) minor
      imperfections of title or minor Encumbrances that in the aggregate do not
      materially detract from the value of the property subject thereto or
      impair in any material respect the use of the property subject thereto,
      and (iv) leases of property owned by the Company.

      "PERSON" means any individual, partnership, corporation, trust,
      unincorporated organization, Governmental Authority or other entity.

      "PLAN" has the meaning given to it in Section 4.20(b).

      "PORTUGUESE GAAP" means the generally accepted accounting principles
      applicable in Portugal and accounting rules and regulations applicable to
      the Company.

      "PRINTGLASS" means Printglass - Transformacao de Vidro LDA.

      "PROCEEDING" means any legal, administrative, arbitration or other
      alternative dispute resolution suit, action, investigation, inquiry or
      other proceeding initiated by any Person, Governmental Authority or other
      party.

      "PURCHASER" has the meaning given to it in the preamble hereto.

      "RELATED PERSON" means, with respect to any entity, any stockholder,
      member of the board of directors or officer of such entity or any relative
      of any such person.

      "RELEASE" means any spilling, leaking, emitting, discharging, depositing,
      escaping, leaching, dumping or other releasing into the Environment,
      whether intentional or unintentional.

      "REMAINING SHARES" has the meaning given to it in Section 1.1(a)(ii).

      "REMAINING SHARES ESCROW AGREEMENT" has the meaning given to it in Section
      1.2(d).

      "REMAINING SHARES PURCHASE DATE" has the meaning given to it in Section
      1.1(a)(ii).

      "SELLER" has the meaning given to it in the preamble hereto.

      "SELLER'S CLOSING STATEMENT OBJECTION" has the meaning given to it in
      Section 1.4(b).

      "SELLER'S CONTINGENCY PAYMENT OBJECTION" has the meaning given to it in
      Section 1.3(d).

                                       44
<PAGE>

      "SHARES" has the meaning given to it in the recitals hereto.

      "SOCIAL" means related to Social Charges.

      "SOCIAL CHARGE" shall mean any social security contribution and any other
      charge or liability relating to employment, including contributions
      relating to unemployment, medical costs, disability, death, pensions,
      retirement and vacation.

      "SUBSIDY" means any governmental, quasi-governmental or other public and
      private grant or subsidy that provides any reimbursement, refund,
      abatement, Tax reduction bonus, exemption, discounted loan, rebate or
      other advantage or benefit, including without limitation, the Government
      Incentive Contract.

      "TAX" and "TAXES" mean any taxes and more generally any mandatory levies
      (including their principal amount and, as the case may be, penalties,
      surcharges and interest thereon) whatever their legal characterization and
      beneficiary may be, including, without limitation: (i) corporation taxes,
      withholding taxes, Value Added Tax (V.A.T.), excise taxes, property taxes,
      business taxes, custom duties, transfer and contribution taxes, stamp
      duty, registration taxes and any taxes based on salaries, (ii) any duty
      paid in consideration for a service provided to the Company, (iii) any
      Liability (whether due or to become due) of the Company determined on the
      basis of any tax or by reference to any taxable basis, and (iv) any tax
      due by a Person other than the Company and for which the Company would be
      liable. Where used as an adjective, "TAX" means related to Taxes.

      "TOTAL PAYMENT AMOUNT" has the meaning given to it in Section 7.9.

      "TRANSACTION" means the sale and transfer of the Shares pursuant to this
      Agreement and all (i) actions to be taken and (ii) transactions and
      agreements to be entered into, pursuant to this Agreement.

      "THIRD PARTY CLAIM" has the meaning given to it in Section 7.5(a).

      "THIRD PARTY CLAIM NOTICE" has the meaning given to it in Section 7.5(a).

      "U.S. GAAP" means generally accepted accounting principle in the United
      States.

                                   ARTICLE 12
                               GENERAL PROVISIONS

12.1. Cooperation. Each of the Parties shall make every effort to ensure that
      all measures necessary or useful for the completion of the Transaction are
      taken in a timely manner. Each of the Parties shall also take all
      necessary steps to permit the other Party and its attorneys to ascertain
      the satisfactory performance of all of its undertakings made herein.

12.2. Announcements. After the date hereof, the Parties shall not issue or cause
      the publication of any press release or other announcement with respect to
      this Agreement or the Transaction without the prior written consent of the
      other Party, which consent shall not be unreasonably withheld or delayed.
      Notwithstanding the foregoing, in the event any such press release or
      announcement is required by or warranted (in the

                                       45
<PAGE>

      opinion of legal counsel) under applicable Law to be made by the Party
      proposing to issue the same, such Party shall use its best efforts to
      consult in good faith the other Party before the issuance of any such
      press release or announcement.

12.3. Assignment.

      (a)   Any Party may transfer some or all of its rights and obligations
            under this Agreement to any of its Affiliates, provided that such
            Party remains jointly liable for all obligations under this
            Agreement.

      (b)   This Agreement and the rights and obligations arising out of it
            shall not otherwise be transferable, either in whole or in part,
            without the prior written consent of the other Party.

12.4. Third Party Beneficiaries. The Parties intend the Company to be a
      third-party beneficiary of this Agreement and for it to remain a
      third-party beneficiary of this Agreement, notwithstanding any sale of any
      or all of the Shares to any third party. Except for the foregoing, nothing
      expressed or implied in this Agreement is intended or shall be construed
      to confer upon or give any Person other than the Parties and their
      successors and assigns any rights or remedies under or by reason of this
      Agreement.

12.5. Entire Agreement. This Agreement (including the annexes hereto) represents
      the entire agreement existing between the Parties relative to the subject
      matter hereof and supersedes all previous negotiations, discussions,
      correspondence, communications, understandings and agreements between the
      Parties relating to the subject matter of this Agreement. This Agreement
      may not be amended except by a written instrument signed by the Parties.

12.6. Severability. If any provision of this Agreement is held to be invalid in
      whole or in part, the validity of the remaining provisions of the
      Agreement shall not be affected thereby. In such event, the Parties shall,
      to the extent possible, substitute for such invalid provision a valid
      provision corresponding to the spirit and purpose thereof.

12.7. Notices and Communications. All notices and other communications required
      under or in connection with this Agreement shall be in writing and, except
      as otherwise expressly provided herein, shall be deemed to have been given
      when delivered in person, on the date of confirmed delivery by a
      nationally recognized overnight courier service, or in any other case upon
      actual receipt by the intended recipient. All such notices and other
      communications shall be dispatched to the appropriate Party at the address
      specified below:

      If to the Purchaser, to:

             Libbey Inc.
             300 Madison Avenue
             Toledo, OH 43604
             U.S.A.
             Attention: General Counsel

                                       46
<PAGE>

      With a copy to:

             Libbey Europe B.V.
             Lingedijk 8
             4142 LD Leerdam
             The Netherlands
             Attention: Managing Director

      If to the Seller, to:

             VAA - Vista Alegre Atlantis SGPS, SA,
             Largo Barao de Quintela, 3-1(degree),
             1200-046 Lisbon
             Portugal
             Attention: General Counsel

      or to such other addressee as the addressees above shall indicate to the
      other Party in accordance with the provisions of this Section 12.7.

12.8. Costs. Unless otherwise stipulated herein, each Party shall be responsible
      for the payment of all fees and costs incurred by it in connection with
      this Agreement and the transactions contemplated hereby, including the
      fees and disbursements of their respective financial advisors, accountants
      and counsel.

12.9. No Waiver. The failure to exercise or delay in exercising a right or
      remedy under this Agreement shall not constitute a waiver of the right or
      remedy or a waiver of any other rights or remedies and no single or
      partial exercise of any right or remedy under this Agreement shall prevent
      any further exercise of the right or remedy or the exercise of any other
      right or remedy.

12.10. Specific Performance. The performance of any of the obligations under
      this Agreement shall be subject to specific performance ("Execucao
      Especifica") as set forth in article 830(0) of the Portuguese Civil Code,
      if applicable.

12.11. Governing Law. This Agreement shall be governed by the Laws of Portugal.

                                       47
<PAGE>

Done in Lisbon, on January 10, 2005 in two original copies.

                       VAA-VISTA ALEGRE ATLANTIS SGPS, SA

                       by: /s/ Bernardo Luis de Azevedo de Vasconcellos e Souza
                           -----------------------------------------------------
                       Name: Bernardo Luis de Azevedo de Vasconcellos e Souza
                       Title: Chairman of the Board of Directors

                       VAA-VISTA ALEGRE ATLANTIS SGPS, SA

                       by: /s/  Rui Manuel Rego Lopes Ferreira
                          -----------------------------------------------------
                       Name: Rui Manuel Rego Lopes Ferreira
                       Title: Director

                       LIBBEY EUROPE B.V.

                       by: /s/ Kenneth G. Wilkes
                          -----------------------------------------------------
                       Name: Kenneth G. Wilkes
                       Title: Managing Director

                       LIBBEY EUROPE B.V.

                       by: /s/ Tom Buch
                           -----------------------------------------------------
                       Name: Tom Buch
                       Title: Managing Director

                                       48
<PAGE>

                             CLOSING ACKNOWLEDGEMENT

      CLOSING ACKNOWLEDGEMENT, dated as of January 10, 2005, by and among VAA -
Vista Alegre Atlantis SGPS, S.A., a sociedade anonima duly incorporated and
organized under the laws of Portugal with its registered office at Largo Barao
de Quintela, 3-1(degree), 1200-046 Lisbon, Portugal (the "SELLER") and Libbey
Europe B.V., a company organized under the laws of the Netherlands with its
principal place of business at Lingedijk 8, 4142 LD Leerdam, the Netherlands
(the "PURCHASER" and, each of the Seller and the Purchaser, a "PARTY").
Capitalized terms used but not defined herein have the meanings specified in the
Stock Promissory Sale and Purchase Agreement (the "PURCHASE AGREEMENT") entered
into by the Seller and the Purchaser on the date hereof.

      The Purchaser hereby represents that each of the conditions to Closing in
Sections 9.1 and 9.3 of the Purchase Agreement have been fulfilled and the
Seller does not need to provide any waivers thereunder. The Seller hereby
represents that each of the conditions to Closing in Sections 9.1 and 9.2 of the
Purchase Agreement have been fulfilled and the Purchaser does not need to
provide any waivers thereunder, except in relation to the following sections of
the Purchase Agreement:

      a)    the covenant contained in Section 6.11, compliance with which is
            required by Section 9.2;

      b)    the representations contained in Sections 4.4 and 4.9, compliance
            with which is required by Section 9.2(a), and the covenant contained
            in Section 6.13(a), compliance with which is required by Section
            9.2(b), to the extent that these sections relate to the Microsoft,
            BAAN licenses or other software licenses; and

      c)    Section 9.2(f).

      The Purchaser hereby waives, as a condition to Closing, fulfillment of
Sections 6.11, 6.13(a) and 9.2(f) and compliance with Sections 4.4 and 4.9, and
the Seller hereby covenants to (a) provide as soon as possible but in no event
later than seventy-five (75) days from the date hereof the transfer pricing file
and any other documentation and information relating thereto required by the
relevant Governmental Authority; (b) secure as soon as possible but in no event
later than thirty (30) days from the date hereof the software licenses mentioned
above in the name of the Company; and (c) provide as soon as possible but in no
event later than thirty (30) days from the date hereof a statement from Nikolaus
SORG GmbH & Co. The Seller acknowledges that it will be liable for any
penalties, fines, and costs relating to such transfer file, the securing of the
software licenses and the use of the software prior thereto, and the costs of
the statement from Nikolaus SORG GmbH & Co. The Seller further agrees that
Sections 7.7 and 7.8 of the Purchase Agreement shall not apply to any Claims in
relation to any of the above and that Section 7.9 shall not apply to Claims in
relation to the transfer pricing file.

      The Parties acknowledge that the Closing is occurring on the date hereof.
The Parties further acknowledge that, on the date hereof, the Purchaser is
giving an irrevocable transfer order for payments for the Company's account in
the following amounts to the following entities, which amounts are included on
the Indebtedness Statement provided by the Seller and are being deducted from
the Initial Payment pursuant to Section 1.2(a)(i): two million

                                       49
<PAGE>

two thousand two hundred seventy-four euro and eleven cents ((euro)
2,002,274.11) to Banco Espirito Santo SA; one million two hundred eighty-nine
thousand three hundred fifteen euro and sixty-six cents ((euro) 1,289,315.66) to
Fortis Bank; and one million five hundred eighty-nine thousand four hundred
ninety-seven euro and twelve cents ((euro) 1,589,497.12) to Banco BPI, SA. In
accordance with Section 1.2(a)(i) of the Share Purchase Agreement, the Purchaser
is giving an irrevocable transfer order for payment to the Seller in the amount
of sixteen million one hundred one thousand five hundred sixty-nine euro and
nine cents ((euro) 16,101,569.09) on the date hereof.

      IN WITNESS WHEREOF, the parties hereto have executed this Closing
Acknowledgement as of the day and year first above written.

                       VAA-VISTA ALEGRE ATLANTIS SGPS, SA

                       by: /s/ Bernardo Luis de Azevedo de Vasconcellos e Souza
                           -----------------------------------------------------
                       Name: Bernardo Luis de Azevedo de Vasconcellos e Souza
                       Title: Chairman of the Board of Directors

                       by: /s/ Rui Manuel Rego Lopes Ferreira
                          ------------------------------------------------------
                       Name: Rui Manuel Rego Lopes Ferreira
                       Title: Director

                       LIBBEY EUROPE B.V.

                       by: /s/ Kenneth G. Wilkes
                          ------------------------------------------------------
                       Name: Kenneth G. Wilkes
                       Title: Managing Director

                       by: /s/ Tom Buch
                          ------------------------------------------------------
                       Name: Tom Buch
                       Title: Managing Director

                                       50
<PAGE>

                                                                    Annex 2.2(c)

                               [LIBBEY LETTERHEAD]

                                                                January 10, 2005

To:      VAA - Vista Alegre Atlantis SGPS, SA
         Largo Barao de Quintela, 3-1(o),
         1200-046 Lisbon
         Portugal

         Libbey Inc. (the "Guarantor") hereby refers to the Stock Promissory
Sale and Purchase Agreement by and between VAA - Vista Alegre Atlantis SGPS, SA
(the "Seller") and Libbey Europe B.V. (the "Purchaser"), dated January 10, 2005
(the "Purchase Agreement"). Terms used but not defined herein shall have the
meaning given to them in the Purchase Agreement.

         The Guarantor hereby constitutes itself jointly and severally liable,
together with the Purchaser, with respect to the due and punctual payment, if
and when such payment becomes due and payable, of the Earn-out Payment under
Section 1.3 of the Purchase Agreement, waiving any rights of prior execution of
Purchaser's assets (beneficio de excussao previa) pursuant to Article 638 of the
Civil Code (the "Guarantee").

         The Guarantor agrees that the following terms and conditions shall
apply to the Guarantee:

         1.  Procedure. If and when the Purchaser shall fail to pay the Earn-out
             Payment (if and when such payment becomes due and payable), the
             Guarantor shall pay such amount to the Seller upon its first
             demand. The Seller shall make such demand by providing a written
             notice to the Guarantor to the effect that the amount that has
             become due and payable has not been paid by the Purchaser within
             the time provided in the Purchase Agreement. Except as provided in
             this Section 1, the Seller shall not be required to give notice to
             or exercise any right or remedy against the Purchaser or to take
             any other step prior to making a demand under this Guarantee.

         2.  Guarantee of Payment. This Guarantee constitutes a guarantee of
             payment when due.

         3.  Amount of Payment. The amount of any Earn-out Payment due to the
             Seller shall be reduced by (a) any amounts the Purchaser is
             permitted to set-off under Section 10.4 of the Purchase Agreement,
             and (b) any partial payments of the Earn-out Payment made by the
             Purchaser in accordance with the Purchase Agreement.

<PAGE>

         4.  Terms of Payment. All payments due under this Guarantee shall be
             paid by the Guarantor to the Seller within seven (7) days following
             notice by the Seller in accordance with Section 1. All such
             payments shall be made in euros, for same day value, by wire
             transfer to the bank account notified in writing by the Seller to
             the Guarantor in such notice.

         5.  Representations and Warranties. The Guarantor represents and
             warrants that the following statements are true, valid and correct
             as of the date hereof and will remain true, valid and correct
             during the Term of this Guarantee:

             (a)  The Guarantor is a corporation duly organized and validly
                  existing under the Laws of its jurisdiction of incorporation.

             (b)  The Guarantor has the power and authority to enter into this
                  Guarantee and to carry out its obligations hereunder. The
                  Guarantor has duly authorized the execution of this Guarantee
                  and no other corporate action on the part of the Guarantor is
                  necessary to authorize the execution by it of this Guarantee.

             (c)  This Guarantee has been duly executed by the Guarantor and
                  constitutes a legal, valid and binding obligation of the
                  Guarantor, enforceable against it in accordance with its
                  terms.

         6.  Term. This Guarantee shall remain in full force and effect until
             the Earn-out Payment, if any, has been paid in full to the Seller.

         7.  Governing Law; Arbitration. This letter shall be governed by the
             laws of Portugal. Any disputes that may arise out of or in
             connection with this letter shall be settled finally and
             exclusively by arbitration by a single arbitrator appointed and
             proceeding in accordance with the Rules of Arbitration of the
             International Chamber of Commerce. The arbitration tribunal shall
             be located in Paris, France.

         8.  Entire Agreement. This letter represents the entire agreement
             existing between the Guarantor and the Seller relative to the
             subject matter hereof and supersedes all previous negotiations,
             discussions, correspondence, communications, understandings and
             agreements between the Guarantor and the Seller relating to the
             subject matter of the Guarantee. This letter may not be amended
             except by a written instrument signed by the Guarantor and the
             Seller.

         9.  Assignment. The Seller may transfer some or all of its rights under
             this Guarantee to any of its Affiliates. The rights of the Seller
             under this Guarantee shall not otherwise be transferable, either in
             whole or in part, without the prior written consent of the
             Guarantor.

         10. Notices. All notices and other communications in connection with
             this Guarantee shall be in writing and, except as otherwise
             expressly provided herein, shall be

                                       2
<PAGE>

             deemed to have been given when delivered in person, on the date of
             confirmed delivery by a nationally recognized overnight courier
             service, or in any other case upon actual receipt by the intended
             recipient. All such notices and other communications shall be
             dispatched to the appropriate party at the address specified below:

             If to the Guarantor, to:

                      Libbey Inc.
                      300 Madison Avenue
                      Toledo, OH 43604
                      U.S.A.
                      Attention: General Counsel

             With a copy to:

                       Libbey Europe B.V.
                       Lingedijk 8
                       4142 LD Leerdam
                       The Netherlands
                       Attention: Managing Director

             If to the Seller, to:

                       VAA - Vista Alegre Atlantis SGPS, SA
                       Largo Barao de Quintela, 3-1(o)
                       1200-046 Lisbon
                       Portugal
                       Attention: General Counsel

             or to such other addressee as the addressees above shall indicate
             to the other party in accordance with the provisions of this
             Section 10.

                                       3
<PAGE>

         IN WITNESS WHEREOF, the Guarantor has executed this letter as of the
date first written above.

                                                LIBBEY INC.

                                                By:  /s/ Kenneth G. Wilkes
                                                    ----------------------
                                                    Name: Kenneth G. Wilkes
                                                          ----------------
                                                    Title: Managing Directory
                                                           ------------------

ACKNOWLEDGED AND ACCEPTED

VAA - VISTA ALEGRE ATLANTIS SGPS, SA

By: Bernardo Luis de Azevedo de Vasconcellos e Souza
    ------------------------------------------------
    Name: Bernardo Luis de Azevedo de Vasconcellos e Souza
          ------------------------------------------------
    Title: Chairman of the Board of Directors
           ----------------------------------

                                       4EX-10.3 Agreement with Investment Banker

 

	 	 	 	 	 
	

	 	Keefe, Bruyette & Woods
	 	 

March 14, 2005

Mr. Peter Humphrey

Chairman, President, & Chief Executive Officer

Financial Institutions, Inc.

220 Liberty Street

Warsaw, NY 14569-0227

Dear Peter:

FII hereby engages Keefe Bruyette & Woods, Inc. (“KBW”) as its exclusive advisor, to provide a
review and assessment of a subset of FII’s loan portfolio (the “Loan File”), including providing
the services listed below under “Scope of Services.” KBW hereby accepts such appointment subject
to the terms and conditions set forth herein:

Scope of Services to be Provided

(1) Initial Loan File review. KBW will analyze the data on the portfolio download provided by FII
to determine the completeness of the data and the gross characteristics of the Loan File:

	 	•  	Summary statistics
	 
	 	•  	Product type (C&I, Agricultural, Real Estate)
	 
	 	•  	Collateral type and value
	 
	 	•  	Relationship statistics
	 
	 	•  	Other characteristics as appropriate

(2) Preliminary Review of Loan File Documents. KBW staff and KBW’s due diligence subcontractor
will review the Loan File documents on-site at FII’s offices in order to evaluate the completeness
of the Loan File’s documentation.

(3) Delivery of report. Upon completion of its analysis and review, KBW will deliver to FII a
report detailing KBW’s findings. KBW will include recommendations for supplementary information or
documentation, if any, in its report on the Loan File.

Terms of the Agreement

	(1)  	Fees: 
	 
	   	Advisory Fee: $50,000, payable within 5 business days of the execution of this
Agreement by KBW and FII.
	 
	   	Expenses: In connection with this engagement, FII will be responsible for all fees
and expenses involved in preparing the Loan File review referenced herein, including all
third party and subcontractor expenses and other costs incurred by KBW, including, but not
limited to the cost of travel and lodging for KBW personnel and other out-of-pocket expenses
related to the Loan File review.
	 
	(2)  	Obligations Limited: FII acknowledges that the descriptions of the Loan File and any
underlying collateral have been furnished by FII and are not representations by KBW. KBW
shall be under

103

 

	   	no obligation to make an independent investigation or inquiry as to the
correctness or completeness of any information or data given to KBW, and shall have no
liability in regard thereto.
	 
	(3)  	Confidentiality: This agreement does not modify or terminate the confidentiality
agreement between KBW and FII, dated March 4, 2005.

(4) Termination: This agreement may not be terminated prior to 120 days from the date
hereof, except that FII may terminate this Agreement with or without cause at any time on notice to
KBW if, in the judgment of FII, KBW has failed to perform or is not performing its obligations
under this Agreement. After the first 120 days, this Agreement may be terminated with or without
cause, thereafter on 10 business days written notice from one party to the other.

(5) Indemnification: FII will indemnify KBW and hold it harmless against any and all
losses, claims, damages or liabilities to which KBW may become subject arising in any manner out of
or in connection with the Loan File review, including, without limitation, FII’s provision of
information to KBW;provided, however, that such indemnity shall not apply in the event it is
finally judicially determined that the loss was primarily caused by KBW’s willful misconduct or
gross negligence. FII shall reimburse KBW for legal or other expenses reasonably incurred by KBW
in connection with investigating, preparing to defend or defending any lawsuits, claims or other
proceedings arising in any manner out of, or in connection with, the rendering of services
hereunder.

(6) Advertising: FII agrees that upon the successful conclusion of this engagement,
KBW shall have the right to place advertisements in financial and other newspapers or journals at
its own expense describing its services to FII hereunder, subject to FII’s prior written consent
approval for each individual advertisement. Effective the date of this Agreement, KBW may list FII
as a client.

(7) Miscellaneous: This Agreement is made solely for the benefit of the parties hereto,
and no other person shall acquire or have any right under or by virtue of this Agreement. This
Agreement shall be governed by and construed and enforced in accordance with the laws of the State
of New York without regard to its conflict-of-laws principles and may be executed in several
counterparts, each of which shall be deemed an original, but all of which together shall constitute
one and the same instrument. Nothing contained herein shall be deemed or construed to create a
partnership or joint venture between the parties hereto, and KBW’s services shall be rendered to
FII as a contractor. The invalidity or unenforceability of any provision of this Agreement shall
not affect the validity or enforceability of any other provisions of this Agreement, which shall
remain in full force and effect.

We look forward to moving ahead with FII on this engagement. Please indicate your acceptance of
this Agreement by countersigning in the space provided below.

Sincerely yours,

	 	 	 	 	 	 	 	 	 
	

	 	Keefe, Bruyette & Woods, Inc.
	 	 	 	           Financial Institutions, Inc.	 	 
	 
	 	 	 	 	 	 	 	 
	
By:

	 	 
	 	 
	 	By:
	 	 
	 
	 	 	 	 	 	 	 	 
	

	 	     Name: Michael MacDonald
	 	 	 	Name: 	 	 
	

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	

	 	     Title: Managing Director
	 	 	 	Title: 	 	 
	

	 	 	 	 	 	 	 	 

104

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