SHARE PURCHASE AGREEMENT BY AND BETWEEN CANON MARKETING JAPAN INC. AND CANON INC. (Sellers) AND STAAR SURGICAL COMPANY (Buyer) 1 October 25, 2007 SHARE PURCHASE AGREEMENT

SHARE PURCHASE AGREEMENT

BY AND BETWEEN

CANON MARKETING JAPAN INC.

AND

CANON INC.

(“Sellers”)

AND

STAAR SURGICAL COMPANY

(“Buyer”)

1

October 25, 2007
SHARE PURCHASE AGREEMENT

This Share Purchase Agreement (the “Agreement”) is entered into on October 25, 2007, by and between CANON MARKETING JAPAN INC. (“CMJ”), a kabushiki kaisha organized and existing under the laws of Japan, and CANON INC. (“CINC”), a kabushiki kaisha organized and existing under the laws of Japan (each, a “Seller”, and collectively, “Sellers”), and STAAR SURGICAL COMPANY, a corporation organized and existing under the laws of the State of Delaware (“Buyer”). Buyer and Sellers are sometimes referred to herein individually as a “Party” and collectively as the “Parties.”

RECITALS

Whereas, CMJ owns One Thousand Nine Hundred and Seventy Five (1,975) shares and CINC owns One Thousand Eight Hundred and Seventy Five (1,875) shares of common stock of CANON STAAR CO., INC. (“the Company”), a kabushiki kaisha organized and existing under the laws of Japan; and

Whereas, Buyer desires to purchase from Sellers, and each Seller desires to sell to Buyer, all of the shares of common stock of the Company owned by the respective Sellers.

AGREEMENT

Now, therefore, in consideration of the mutual promises herein made, and in consideration of the representations, warranties, and covenants herein contained, the Parties agree as follows.

Unless otherwise provided in this Agreement, the following terms, when capitalized herein, shall have the meanings set forth in this Section 1.

“Act” shall mean the United States Securities Act of 1933, as amended.

“Adverse Consequences” shall mean all actions, suits, proceedings, hearings, investigations, charges, complaints, claims, demands, injunctions, judgments, orders, decrees, rulings, damages, dues, penalties, fines, costs, reasonable amounts paid in settlement, liabilities, obligations, taxes, liens, losses, expenses and fees, including court costs and reasonable attorneys’ fees and expenses.

“Affiliate” shall mean with respect to any specified Person, any other Person that directly, or indirectly through one or more intermediaries, Controls, is Controlled by, or is under common Control with, such specified Person. For purposes of this Agreement, (a) the Company shall not be regarded as an Affiliate of (i) either of Sellers or their respective Affiliates or (ii) Buyer and its Affiliates and (b) (i) each of Sellers and their respective Affiliates and (ii) Buyer and its Affiliates, shall not be regarded as Affiliates of the Company.

“Ancillary Agreements” shall mean the Certificate of Designation, Seller’s Certificate of CINC, Seller’s Certificate of CMJ, Buyer’s Certificate, Company’s Certificate, Inventory Sales Agreement, General Releases, Current Employees Secondment Agreement, New Employees Secondment Agreement and Termination Agreement.

“Business” means research, development, manufacture, marketing, sale or distribution of implantable silicone and collagen copolymer intraocular lenses whether phakic or aphakic, whether spheric or aspheric, and insertion devices for such implants and collagen glaucoma wicks.

“Buyer” has the meaning set forth in the preface above.

“Buyer’s Certificate” shall mean a certificate in the form attached hereto as Exhibit F.

“Cash Consideration” has the meaning set forth in Section 2.3(a).

“Certificate of Designation” has the meaning set forth in Section 2.3(b).

“CINC” has the meaning set forth in the preface above.

“Closing” has the meaning set forth in Section 2.2.

“Closing Date” shall mean the second business day following the satisfaction or waiver of the conditions to the obligations of the Parties to consummate the transactions contemplated hereby (other than conditions with respect to actions the respective Parties will take at the Closing itself) or such other date as the Buyer and the Sellers may mutually determine (the “Closing Date”); provided, however, that the Closing Date shall be no earlier than December 28, 2007.

“Company” has the meaning set forth in the preface above.

“Company’s Certificate” shall mean a certificate in the form attached hereto as Exhibit G.

“Control”, by any Person with respect to any other Person shall mean the direct or indirect control of fifty percent (50%) or more of the voting stock or other ownership interest by such Person of the other Person, or if such Person possesses the power to direct or cause the direction of the management and policies of the other Person or the power to elect or appoint fifty percent (50%) or more of the members of the governing body of the other Person. References to (i) the verb form of “Control,” in any tense, means to have Control of a Person and (ii) the adjective form of “Control” means having an ownership interest that would have the ability to Control a Person.

“Conversion Shares” has the meaning set forth in Section 5.9.

“Current Employees Secondment Agreement” shall mean an agreement in the form attached hereto as Exhibit I-1.

“Earnings Suspension” has the meaning set forth in Section 8.4(i).

“Exchange Act” shall mean the United States Securities Exchange Act of 1934, as amended.

“General Release” shall mean a release in the form attached hereto as Exhibit K, to be executed by all directors of the Company pursuant to Section 7.

“Governmental Authority” shall mean any national government, any regional, local or other political subdivision thereof with jurisdiction and any Person with jurisdiction exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government.

“Holder Indemnitee” has the meaning set forth in Section 8.4(h).

“Indemnified Party” has the meaning set forth in Section 8.3(a).

“Indemnifying Party” has the meaning set forth in Section 8.3(a).

“Internal Regulations” shall mean the Company’s Articles of Incorporation, Bylaws, Rules of Organization, Rules for Job Functions and Rules for the Use of the Application for Approval or Impression of Seal.

“Inventory Sales Agreement” shall mean an agreement in the form attached hereto as Exhibit H.

“JVA” shall mean that certain Joint Venture Agreement among each of Sellers and Buyer dated May 23, 1988.

“Laws” shall mean any applicable statutes, laws, rules, regulations, orders, ordinals, codes and decrees of any Governmental Authority.

“Knowledge” shall mean knowledge by any director or executive officer of the Person in question, without independent investigation.

“New Employees Secondment Agreement” shall mean an agreement in the form attached hereto as Exhibit I-2.

“Person” shall mean any individual, partnership, firm, corporation, association, trust, unincorporated organization or other entity.

“Preferred Shares” has the meaning set forth in Section 2.3(b).

“Qualified Amount” has the meaning set forth in Section 8.2(a).

“Registration Period” has the meaning set forth in Section 6.3(g)(i).

“Registration Statement” has the meaning set forth in Section 6.3 (g)(i).

“SEC” shall mean the United States Securities and Exchange Commission.

“Security Interest” shall mean any mortgage, deed of trust, pledge, lien (statutory or other), encumbrance, preference, priority, assignment, hypothecation, charge or other security interest.

“Sellers” or “Seller” has the meaning set forth in the preface above.

“Seller’s Certificate” shall mean a certificate in the form attached hereto as Exhibit E.

“Signing Date” shall mean the date of this Agreement.

“Suspension Period” has the meaning set forth in Section 8.4(i).

“TALA” shall mean that certain Technical Assistance and License Agreement between Buyer and the Company dated September 6, 1988.

“Termination Agreement” shall mean an agreement in the form attached hereto as Exhibit J.

“Third Party Claim” has the meaning set forth in Section 8.3(a).

“Transferred Shares” has the meaning set forth in Section 2.1.

Each Seller hereby severally but not jointly represents and warrants to Buyer that the statements contained in this Section 3 are true, correct and complete as of the Signing Date and will be true, correct and complete as of the Closing.

Buyer hereby represents and warrants to Sellers that the statements contained in this Section 5 are true, correct and complete as of the Signing Date and will be true, correct and complete as of the Closing.

The Parties agree that if at any time after the Signing Date but before the Closing Date any further action is necessary or desirable to carry out the purposes of this Agreement, each of the Parties will take such further action (including the execution and delivery of such further instruments and documents) the other Party reasonably may request. If at any time after the Closing Date any further action is necessary or desirable to carry out the purposes of this Agreement, each of the Parties will take such further action (including the execution and delivery of such further instruments and documents) the other Party reasonably may request, all at the sole cost and expense of the requesting Party (unless the requesting Party is entitled to indemnification therefor under Section 8).

On or prior to the Closing Date, each of the Parties shall cause the directors of the Company nominated by such Party to vote in favor of a board resolution of the Company approving the acquisition by Buyer of the Transferred Shares .

Prior to the Closing Date, each of the Parties shall vote in favor of a shareholder resolution of the Company to remove the word “Canon” from its name effective as of the Closing Date;

Prior to the Closing Date, each of the Parties shall vote in favor of a shareholder resolution of the Company to appoint a replacement effective as of the Closing Date for each director and statutory auditor who is to submit a resignation pursuant to the provisions of Sections 7.1(g);

On or prior to the Closing, each of the Parties shall cause the Company to file for registration of the new company name and directors and statutory auditor approved by the Company pursuant to Section 6.2(b) and Section 6.2(c) respectively;

On or prior to the Closing, each Seller shall return or destroy all information of the Company and Buyer in the possession of such Seller reasonably identified and requested by Buyer; provided, however, that Sellers shall be permitted to retain information in order to prepare their own financial statements, tax records and submissions to tax authorities and any other necessary reasons as indicated in Section 6.3(a).

On or prior to the Closing, Buyer shall return or destroy all information of Sellers in the possession of Buyer reasonably identified and requested by Sellers.

On or prior to the Closing, the Parties shall instruct their respective appointees to the board of directors of the Company to cause the Company to return or destroy all information of Sellers in the possession of the Company reasonably identified and requested by Sellers (other than marketing information relating to the Business and customer lists relating to the Business provided by CMJ to the Company).

On or prior to the Closing each Party shall sign, or cause to be signed, and deliver each of the Ancillary Agreements to which it is a party.

The Parties shall cause the Company to sign and deliver the Company’s Certificate, Inventory Sales Agreement, Current Employees Secondment Agreement, New Employees Secondment Agreement and Termination Agreement.

Prior to the Closing, Buyer shall file the Certificate of Designation with the State of Delaware.

Buyer and its agents shall have reasonable access for purposes of conducting its due diligence investigation up through and including the Closing Date, during business hours and upon reasonable notice to (a) any and all of the books and records of the Company, and (b) the premises and personnel of the Company, with due consideration for the need to continue the business and maintain employee relations. The due diligence investigation shall include access to (a) sample form contracts used by CMJ with its customers and sub-distributors of the Company’s products and (b) a list of such customers and sub-distributors if requested by the Buyer.

Upon Buyer’s request, CMJ shall use reasonable commercial efforts to attempt to obtain the consent of any counterparties to an assignment of any contracts executed by CMJ prior to the Closing Date with its customers and sub-distributors for the Company’s products to the Company, or where appropriate, the Buyer.

The Parties covenant and agree that until the Closing (unless Buyer shall otherwise approve in writing or unless otherwise expressly permitted by this Agreement) no orders or authorizations shall unilaterally be given by any Party as a shareholder of the Company (or any of its appointees who are directors or statutory auditors of the Company) to the General Manager, the Business Headquarters Chief, or any or all of the representative directors, whether pursuant to the Internal Regulations or otherwise, and all such orders or authorizations, as the case may be, shall be jointly given by all of the Parties in the case of an order, or unanimously approved by the board of directors in the case of an authorization.

After the Closing, to the extent necessary for Sellers to prepare their own financial statements, tax records and submissions to tax authorities and any other necessary reasons, Sellers will have reasonable access to the books and records of the Company relating to any period prior to January 1, 2008.

After the Closing, except with respect to the CANON STAAR logo placed on products of the Company, packaging and labeling prior to the Closing, Buyer shall cause the Company to cease using any mark of Sellers, including without limitation, in the labeling and marking of products of the Company and in promotional and website materials. Neither of Sellers shall assert any claims for use of the CANON STAAR logo following the Closing with respect to products which (a) were (i) manufactured by the joint venture prior to the Closing or (ii) work in progress as of the Closing that already have the CANON STAAR logo affixed to the product or its packaging, (b) are sold in the ordinary course of business and (c) are not modified by the Company after the Closing (except with respect to work in progress described in clause (a) above which may be finalized in accordance with standard specifications). The Company may use product literature incorporating the CANON STAAR logo for a period up to six (6) months, provided the logo is covered with a sticker or other obscuring device and the Company shall exert all commercially reasonable efforts to replace such literature at the earliest practicable date.

After the Closing, Buyer shall cause the Company to continue to provide employment for those individuals who were permanent, full-time workers of the Company as of the Closing Date under similar working conditions to those in place immediately prior to the Closing.

Within fifteen (15) days after the Closing, Buyer shall file a notice pursuant to Regulation D under the Act with respect to the issuance of the Preferred Shares.

If either of Sellers proposes to sell common stock issuable upon the conversion of the Preferred Shares, in compliance with Rule 144 promulgated by the SEC, then, upon such Seller’s written request to Buyer, Buyer shall furnish to such Seller, within five (5) days after receipt of such request, a written statement confirming the Buyer’s compliance with the filing requirements of the SEC as set forth in such Rule, as such Rule may be amended from time to time.

If at any time after the Closing until the time of conversion or redemption of Preferred Shares, Buyer is not subject to reporting requirements under either Section 13(d) or Section 15(d) of the Exchange Act, Buyer shall provide to Sellers annual, audited financial statements of Buyer within sixty (60) days after the end of each fiscal year, and interim unaudited financial statements within thirty (30) days after the end of each fiscal quarter.

If to CMJ:

Canon Marketing Japan Inc.
16-6, Konan 2-chome,
Minato-ku, Tokyo 108-8011, Japan
Attention: Hiroshi Shibuya, Managing Director, President of Industrial Equipment Co.
Facsimile: 81-3-3740-3389

With a copy to:

Jones Day
Shiroyama MT Bldg.
1-17, Toranomon 4-chome, Minato-ku,
Tokyo 105-0001
Japan
Attention: Scott Jones
Facsimile: 81-3-5401-2725

If to CINC:

Canon Inc.
30-2, Shimomaruko 3-chome,
Ohta-ku, Tokyo 146-8501, Japan
Attention: Masahiro Osawa, Managing Director, Group Executive of Finance & Accounting Headquarters
Facsimile: 81-3-5482-3960

With a copy to:

Jones Day
Shiroyama MT Bldg.
1-17, Toranomon 4-chome, Minato-ku,
Tokyo 105-0001
Japan
Attention: Scott Jones
Facsimile: 81-3-5401-2725

If to Buyer:

STAAR Surgical Company
1911 Walker Avenue
Monrovia, California 91016, U.S.A.
Attention: Charles Kaufman
Facsimile: 1 ###-###-####

With a copy to:

Shartsis Friese LLP
One Maritime Plaza, 18th Floor
San Francisco, CA 94111
Attention: P. Rupert Russell, Esq.
Facsimile: 1 ###-###-####

[Signature Page Follows]

A.

2 IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed as of the day and year first written above.

CANON MARKETING JAPAN INC.

[Signature page to Share Purchase Agreement]

3

Exhibit A

1. Ownership in the Company by CMJ and CINC

(a) Sale to Buyer by CMJ of 1,975 Transferred Shares in consideration for US$2,051,948 in cash and 872,078 Preferred Shares.

(b) Sale to Buyer by CINC of 1,875 Transferred Shares in consideration for US$1,948,052 in cash and 827,922 Preferred Shares.

4

Exhibit B

[Certificate of Designation]

5

CERTIFICATE OF DESIGNATION

OF THE

SERIES A CONVERTIBLE PREFERRED STOCK

OF

STAAR SURGICAL COMPANY

Pursuant to Section 151

of the

General Corporation Law of the State of Delaware

Pursuant to Section 103 of the Delaware General Corporation Law (the “DGCL”), STAAR Surgical Company, a corporation duly organized and existing under the laws of the State of Delaware (the “Corporation”), does hereby certify the following:

1. Article Fourth of the Certificate of Incorporation of the Corporation authorizes the issuance of up to ten million (10,000,000) shares of preferred stock, $.01 par value (the “Preferred Stock”), and expressly vests in the Board of Directors of the Corporation the authority to issue the shares of Preferred Stock, to act from time to time by resolution to establish one or more series of Preferred Stock, and to fix the designation, powers, preferences and rights of the shares of each such series and their qualifications, limitations, or restrictions.

2. Pursuant to the authority described in the preceding paragraph, the Board of Directors, at a duly called meeting held on October 22, 2007, at which a quorum was present and acted throughout, adopted the following resolutions establishing a series of Preferred Stock:

RESOLVED, that a series of the class of authorized Preferred Stock of the Corporation be and hereby is created, and that the designation and amount thereof and the voting powers, preferences and relative participating, optional and other special rights of the shares of such series, and the qualifications, limitations or restrictions thereof are as follows:

Series A Convertible Preferred Stock

1. Designation and Amount. The shares of the series created by these resolutions shall be designated “Series A Convertible Preferred Stock” (the “Series A Preferred Stock”) and the number of shares constituting such series shall be one million seven hundred thousand (1,700,000).

2. Dividends and Distributions. The Series A Preferred Stock shall have the right to participate pari passu in any dividend or distribution paid with respect to the Common Stock, if as and when declared by the Board of Directors, based on the number of shares of Common Stock into which a share of Preferred Stock is convertible hereunder as of the record date for such dividend or distribution.

3. Liquidation Preference. In the event of any voluntary or involuntary liquidation, dissolution or winding up of the Corporation, or the acquisition of the Corporation by another entity by means of any reorganization, merger or consolidation, or any transaction in which the Corporation’s stockholders of record as constituted immediately prior to such transaction (by virtue of securities issued in such transaction) fail to hold, directly or indirectly, more than 50% of the voting power of the resulting or surviving corporation following such transaction (but excluding, however, any reorganization, merger or consolidation effected exclusively for the purpose of changing the domicile of the Corporation) (an “Acquisition Transaction”), or a sale, lease, license or disposition of all or substantially all of the assets of the Corporation (collectively, a “Liquidation”), the holders of the outstanding shares of Series A Preferred Stock shall be entitled to receive, out of the assets of the Corporation available for distribution to its stockholders, whether from capital, surplus funds or earnings, prior and in preference to any distribution of any of the assets of the Corporation to the holders of the Common Stock, and any other series of Preferred Stock (except with respect to a reorganization, merger, consolidation or an Acquisition Transaction, such Preferred Stock that has been designated for issuance upon exercise of rights issued to the Corporation’s stockholders pursuant to a stockholder rights plan (“Stockholder Rights Plan”)), an amount per share equal to the Redemption Price for such share, as defined in Section 6(a) below. After the full liquidation preference of the holders of the outstanding shares of Series A Preferred Stock has been satisfied as set forth in this Section 3, the Series A Preferred Stock shall have no right to participate in the distribution of the remaining assets of the Corporation. Until the effective date of the Liquidation, each holder of Series A Preferred Stock may elect to convert such holder’s Shares to Common Stock and participate in the proceeds of the Liquidation to be paid to holders of Common Stock in lieu of any liquidation preference.

4. Conversion Rights. The Series A Preferred Stock shall be convertible at no cost to the holder into shares of Common Stock as set forth in this Section 4. The shares of Common Stock issuable on such conversion (the “Conversion Shares”) shall be equal to the number of shares of Series A Preferred Stock converted times the Conversion Ratio as defined in Section 4(d) below; provided, however, that, subject to the provisions of Section 6(h) below, following due notice by the Corporation of a Change of Control as provided in Section 5(b) the conversion right set forth in this Section 4(a) shall expire two (2) days prior to the effective date of the Change of Control set forth in the notice.

(a) Conversion at Option of Holder. Each holder of Series A Preferred Stock shall have the right, at the option of the holder at any time after the date on which shares of Series A Preferred Stock first are issued (the “Issue Date”), to convert each of the holder’s shares of Series A Preferred Stock into fully paid and nonassessable shares of Common Stock in a number equal to the Conversion Ratio (as defined in Section 4(d) below) as of the effective date of the conversion.

(b) Mechanics of Conversion at Option of Holder. Before any holder of Series A Preferred Stock shall be entitled to receive the Conversion Shares issuable pursuant to Section 4(a), the holder shall surrender the certificate or certificates therefor, duly endorsed, at the office of the Corporation or of any transfer agent for the Series A Preferred Stock, and shall give written notice to the Corporation at its principal corporate office of the election to convert the shares of Preferred Stock. The notice shall state the name or names in which the certificate or certificates for shares of Common Stock are to be issued, and the address or addresses to which the certificates are to be delivered. The Corporation shall, as soon as practicable, but in any event in no less than seven (7) business days thereafter, issue the Conversion Shares issuable with respect to the surrendered shares, and deliver the certificates evidencing the Conversion Shares to the address or addresses set forth in the notice. The cancellation of the surrendered shares of Series A Preferred Stock and the issuance of the Conversion Shares of Common Stock shall be deemed to have occurred immediately prior to the close of business on the date the shares of Series A Preferred Stock to be converted are surrendered to the Corporation or the transfer agent, and the person or persons entitled to receive the shares of Common Stock issuable upon such conversion shall be treated for all purposes as the record holder or holders of such shares of Common Stock as of such date.

(c) Automatic Conversion. At 12:01 a.m. on the fifth (5^th) anniversary of the Issue Date (the “Preferred Termination Date”), each share of Series A Preferred Stock shall automatically be converted into the number of fully paid and nonassessable shares of Common Stock equal to the Conversion Ratio as of the Preferred Termination Date. The record holder of each share of Series A Preferred Stock shall be treated for all purposes as the record holder of the related Conversion Shares as of the Preferred Termination Date. From and after the Preferred Termination Date, any unredeemed and otherwise validly outstanding certificate for the Series A Preferred Stock shall be deemed cancelled and to be evidence only of the Conversion Shares issuable with respect to the shares of Series A Preferred Stock enumerated on such certificate. After the Preferred Termination Date, upon surrender to the Corporation by the holder of a certificate of Series A Preferred Stock the holder will be entitled to receive certificates evidencing the Conversion Shares.

(d) Conversion Ratio. The number of shares of Common Stock issuable on the conversion of one share of Series A Preferred Stock (the “Conversion Ratio”) shall be equal to the Redemption Price divided by $4.00, subject to adjustments from time to time as follows:

(i) Splits, Reverse Splits, Combinations, Stock Dividends and the Like. If, after the Issue Date, the Corporation fixes a record date for a split, reverse split, subdivision or combination of the outstanding shares of Common Stock, or the determination of holders of Common Stock entitled to receive a dividend or other distribution payable in additional shares of Common Stock or other securities or rights convertible into, or entitling the holder thereof to receive directly or indirectly, additional shares of Common Stock (hereinafter referred to as “Common Stock Equivalents”) without payment of any consideration by such holder for the additional shares of Common Stock or the Common Stock Equivalents (including the additional shares of Common Stock issuable upon conversion or exercise thereof), then, as of such record date (or the date of such dividend distribution, split or subdivision if no record date is fixed), the Conversion Ratio shall be adjusted by multiplying the Conversion Ratio in effect prior to such event by a fraction, the denominator of which is the total number of shares of Common Stock and Common Stock Equivalents issued and outstanding immediately prior to such event, and the numerator of which is the number of shares of Common Stock and Common Stock Equivalents to be outstanding immediately after such event.

(ii) Recapitalization, Reclassification or Reorganization. If the Corporation shall undergo any capital reorganization or any reclassification of the stock of the Corporation (other than as a result of a stock dividend or subdivision, split-up or combination of shares) or a reorganization, merger or consolidation that does not constitute or result in a Change of Control (as defined in Section 5(a)), then the Conversion Ratio shall be adjusted so that after such transaction a holder of Series A Preferred Stock will receive on conversion of such holder’s shares the same number and kind of securities that such holder would receive in consideration of the Conversion Shares had such holder converted the Preferred Stock immediately prior to such event.

(e) Fractional Shares. No fractional shares shall be issued upon conversion of any share or shares of the Series A Preferred Stock and the number of shares of Common Stock to be issued shall be rounded to the nearest whole share. Whether or not fractional shares are issuable upon such conversion shall be determined on the basis of the total number of shares of Series A Preferred Stock the holder is at the time converting into Common Stock and the total number of shares of Common Stock issuable upon such aggregate conversion. If, after the aforementioned determination, the conversion would result in the issuance of a fraction of a share of Common Stock, the Corporation, shall, in lieu of issuing any fractional share, pay the holder otherwise entitled to such fraction a sum in cash equal to the fair market value of such fraction on the date of conversion.

(f) Reservation of Stock Issuable Upon Conversion. The Corporation shall at all times reserve and keep available out of its authorized but unissued shares of Common Stock, solely for the purpose of effecting the conversion of the shares of the Series A Preferred Stock, such number of its shares of Common Stock as shall from time to time be deemed sufficient to effect the conversion of all outstanding shares of the Series A Preferred Stock; and if at any time the number of authorized but unissued shares of Common Stock shall not be sufficient to effect the conversion of all then outstanding shares of the Series A Preferred Stock, the Corporation will take such corporate action as may, in the opinion of its counsel, be necessary to increase its authorized but unissued shares of Common Stock to such number of shares as shall be sufficient for such purpose, including, without limitation, engaging in best efforts to obtain the requisite stockholder approval of any necessary amendment to this Certificate.

(g) Issue Taxes. The Corporation shall pay any and all issue and other taxes and costs that may be payable in respect of any issue or delivery of shares of Series A Preferred Stock or Common Stock issued on conversion of the Series A Preferred Stock pursuant hereto.

(h) No Impairment. The Corporation will not, by amendment of its Certificate of Incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance of performance of any of the terms to be observed or performed hereunder by the Corporation, but will at all times in good faith assist in the carrying out of all the provisions of this Section 4 and in the taking of all such actions as may be necessary or appropriate in order to protect the rights of the holders of the Series A Preferred Stock against impairment.

(i) Certificates of Adjustment. Upon the occurrence of each adjustment or readjustment of the Conversion Ratio pursuant to this Section 4, the Corporation at its expense shall promptly compute such adjustment or readjustment in accordance with the terms hereof and prepare and furnish to each holder of Series A Preferred Stock a certificate executed by the Corporation’s President or Chief Financial Officer setting forth such adjustment or readjustment and showing in detail the facts upon which such adjustment or readjustment is based. The Corporation shall, upon the written request at any time of a holder of Series A Preferred Stock, furnish or cause to be furnished to such holder a like certificate setting forth (i) such adjustments and readjustments, (ii) the Conversion Ratio at the time in effect and (iii) the number of shares of Common Stock and the amount, if any, of other property which at the time would be received upon the conversation of the Series A Preferred Stock.

(j) Notices. In the event that the Corporation shall determine to effect or undergo any of the events described in Section 4(d), then, in connection with each such event, the Corporation shall send to the holders of Series A Preferred Stock (i) at least twenty (20) days’ prior written notice of the date on which, if applicable, a record shall be taken for any related dividend, distribution or subscription rights (and specifying the date on which the holders of Common Stock shall be entitled thereto) or for determining rights to vote, if any, with respect to such matter and (ii) at least twenty (20) days’ prior written notice of the date when the matter in question shall be consummated (and, if applicable, specifying the date on which the holders of Common Stock shall be entitled to exchange their Common Stock for securities or other property deliverable upon the occurrence of such event). Each such written notice (or a subsequent notice given at least ten (10) days prior to any events described in Section 4(d)) shall set forth, in reasonable detail, (i) the event requiring the notice and (ii) if an adjustment is required to be made, (A) the amount of such adjustment, (B) the method by which such adjustment was calculated and (C) the adjusted Conversion Ratio (if the Conversion Ratio has been adjusted). Failure to timely provide such notice shall entitle the holders of Series A Preferred Stock to retain the benefit of the applicable notice period notwithstanding anything to the contrary contained in any insufficient notice received by such holder. The notice period shall begin on the date such holder actually receives a written notice containing all the information required to be provided in this Section 4(j), such receipt evidenced by (i) a receipt from an established international courier of delivery confirming verification of receipt, (ii) a return receipt of a registered or certified mail delivery or (iii) a confirmation of transmission of a facsimile or confirmation of delivery of electronic mail.

5. Change of Control.

(a) Definition Change of Control. “Change of Control” shall mean the acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of more than 50% of the combined voting power of the then outstanding Common Stock and any other securities of the Corporation entitled to vote generally in the election of directors (the “Voting Securities”), but excluding, for this purpose, any such acquisition by (i) a parent or subsidiary of the Corporation, (ii) any corporation with respect to which, following such acquisition, a majority of the combined voting power of the then outstanding securities of such corporation entitled to vote generally in the election of directors is then beneficially owned, directly or indirectly, by individuals and entities who were the beneficial owners of the Voting Securities of the Corporation immediately prior to such acquisition in substantially the same proportion as their ownership, immediately prior to such acquisition, of the Voting Securities.

(b) Notice of Change in Control. The Corporation shall give each holder of record of Series A Preferred Stock written notice of an impending Change of Control not later than twenty (20) days prior to the earlier of (i) any record date relating to such Change of Control, (ii) any stockholders’ meeting called to approve such transaction, or (iii) the closing of such transaction, and shall also notify such holders in writing of the final approval of such transaction, the intended effective date, and that, subject to the provisions of Section 6(h) below, the holders’ option to convert the shares of Series A Preferred Stock shall expire at the close of business on the second (2nd) business day prior to the effective date of the transaction. Such notice shall describe the material terms and conditions of the impending transaction, and the Corporation shall thereafter give such holders prompt notice of any material changes. The transaction shall in no event take place sooner than twenty (20) days after the Corporation has given the first notice provided for herein or sooner than ten (10) days after the Corporation has given notice of any material changes provided for herein; provided, however, that such periods may be shortened upon the written consent of the holders of a majority of the Series A Preferred Stock.

6. Redemption and Voting Rights.

(a) Definition of Redemption Price. The Redemption Price as of any date shall be the sum of (i) US$4.00 per share plus (ii) an amount equal to the sum of all accrued or declared but unpaid dividends, if any, on such share.

(b) Redemption Pursuant to Call Right of the Corporation. At any time on or after the first anniversary of the Issue Date, and as permitted under Section 160 of the DGCL, the Corporation may redeem all of the outstanding shares of Series A Preferred Stock at the Redemption Price by delivering a notice of redemption (a “Call Notice”) to the holders, which Call Notice shall specify a Redemption Date not less than thirty (30) or more than ninety (90) days from the date of such notice; provided, however, that each holder of shares of Series A Preferred Stock will continue to have the right to convert such shares until the close of business on the fifth (5th) business day prior to the Redemption Date.

(c) Redemption at Option of Holders. At any time on or after the third anniversary of the Issue Date, upon the written request of the holders of a majority of the outstanding shares of Series A Preferred Stock (which request shall be accompanied by the certificate(s), duly endorsed, evidencing such holders’ shares and specify a Redemption Date not less than thirty (30) or more than ninety (90) days from the date of such request), the Corporation shall redeem all of the issued and outstanding shares of Series A Preferred Stock on the specified Redemption Date at the Redemption Price. Upon delivery of such request all conversion rights of the Series A Preferred Stock shall terminate. If less than all of the shares of Series A Preferred Stock are included in the request, the Corporation shall provide notice to the remaining holders that the Series A Preferred Stock has been redeemed, together with instructions for tendering the certificates for such stock.

(d) Redemption upon Liquidation or Change of Control. On or prior to the effective date of any Change in Control or Liquidation of the Corporation, any holder of shares of Series A Preferred Stock may elect to have redeemed at the Redemption Price such shares of Series A Preferred Stock that are issued and outstanding on such date; provided, however, that, subject to the provisions of Section 6(h) below, each holder of shares of Series A Preferred Stock will continue to have the right to convert such shares until the close of business on the second (2nd) business day prior to the effective date of the transaction, at which time such right expires, and provided further, that if the Corporation has not timely provided to any record holder the notice specified in Section 4(j) or Section 5(b), then until the fifteenth (15th) day after the Corporation has delivered such notice such holder shall have the right (the “Notice Failure Right”) to elect to be deemed to have redeemed or converted such holder’s shares of Series A Preferred Stock immediately before the effective date of the Liquidation or Change of Control. The Redemption Date for any redemption under this Section 6(d) shall be the effective date of the Liquidation or Change of Control.

(e) Effect of Redemption. If, with respect to all shares of Series A Preferred Stock to be redeemed, the Redemption Price has been timely paid, from and after the applicable Redemption Date all rights of the holders of the Series A Preferred Stock (except the right to receive the Redemption Price and any Notice Failure Right) shall cease with respect to such shares, and such shares shall not thereafter be transferred on the books of the Corporation or be deemed to be outstanding for any purpose whatsoever.

(f) Mechanics of Redemption. From and after any Redemption Date each holder of Series A Preferred Stock tendering shares for redemption shall surrender to the Corporation at its principal corporate office the certificate or certificates representing such shares (if not already surrendered pursuant to Section 6(c)), duly endorsed, and thereupon the Redemption Price of such shares shall be paid by the Corporation after receipt of the shares to the person whose name appears on such certificate or certificates as the owner thereof and each surrendered certificate shall be cancelled.

(g) Payment of Redemption Price. The holders of Series A Preferred Stock shall be entitled to receive the Redemption Price on or before the later of the applicable Redemption Date and the date five (5) days after the receipt by the Corporation of the certificate for the redeemed shares, provided, however, that in no case shall the Corporation be required to pay a Redemption Price which in the aggregate would be in violation of Section 160 of the DGCL. In such event, following a redemption under Section 6(c) or 6(d) those funds of the Corporation that are available hereunder for redemption shall be used to redeem the maximum number possible of such shares ratably among the holders of such shares to be redeemed. The tendered shares of Series A Preferred Stock for which the applicable Redemption Price is not received on or before the applicable Redemption Date shall be considered not to have been redeemed and shall remain outstanding and entitled to all the rights and preferences provided herein and shall be redeemed by the Corporation as soon as permitted pursuant to this Section 6(g).

(h) Deemed Redemption or Conversion. If any holder of shares of Series A Preferred Stock does not elect to have such shares redeemed pursuant to Section 6(d) or elect to convert such shares pursuant to Section 4, prior to the close of business on the second (2nd) business day prior to the effective date of any Change in Control or Liquidation of the Corporation (the “Calculation Date”), then upon the effective date of the Change in Control or Liquidation but immediately prior thereto, the issued and outstanding shares of Series A Preferred Stock shall automatically be deemed to have been converted or redeemed dependent on which action results in the higher ultimate proceeds payable to the holders of shares of Series A Preferred Stock (the “Higher Value”). For purposes of determining the Higher Value the following shall apply:

(i) if the proceeds are paid solely in cash, the Higher Value shall be the higher of (x) the aggregate Redemption Price for all shares of Series A Preferred Stock or (y) the amount that is the higher of (A) the aggregate amount which would be paid for all Conversion Shares in such transaction or (B) the aggregate value of the Conversion Shares based upon the closing price of the Conversion Shares on the Calculation Date as reported on the NASDAQ Stock Market (including, without limitation, the NASDAQ Global Select Market, the NASDAQ Global Market or the NASDAQ Capital Market, as applicable) or, if not listed on such exchange, on any other national securities exchange on which the shares of Common Stock of the Corporation are listed or, if not listed on any such other national securities exchange, the NASD OTC Bulletin Board or any other quotation facility on which the             shares of Common Stock of the Corporation are quoted; provided, however, that if there is no regular trading market for such shares of Common Stock of the Corporation, the market value per share shall be determined in good faith by the Board of Directors;

(ii) if the proceeds paid include securities of another entity, the Higher Value shall be the higher of (x) the aggregate Redemption Price for all shares of Series A Preferred Stock or (y) the amount that is the higher of (A) the aggregate valuation of such consideration for all Conversion Shares, as determined in good faith by the Corporation’s Board of Directors (without regard to any tax benefits or other special arrangements attributable to the holders of the Conversion Shares as a result of such Change in Control or Liquidation) or (B) the aggregate value of the Conversion Shares based upon the closing price of the Conversion Shares on the Calculation Date as reported on the NASDAQ Stock Market (including, without limitation, the NASDAQ Global Select Market, the NASDAQ Global Market or the NASDAQ Capital Market, as applicable) or, if not listed on such exchange, on any other national securities exchange on which the shares of Common Stock of the Corporation are listed or, if not listed on any such other national securities exchange, the NASD OTC Bulletin Board or any other quotation facility on which the             shares of Common Stock of the Corporation are quoted; provided, however, that if there is no regular trading market for such shares of Common Stock of the Corporation, the market value per share shall be determined in good faith by the Board of Directors; and

(iii) if the proceeds consist of property other than cash or securities, the Higher Value shall be the higher of (x) the aggregate Redemption Price for all             shares of Series A Preferred Stock or (y) the amount that is the higher of (A) the aggregate valuation of such property (as determined in good faith by the Corporation’s Board of Directors) for all Conversion Shares or (B) the aggregate value of the Conversion Shares based upon the closing price of the Conversion Shares on the Calculation Date as reported on the NASDAQ Stock Market (including, without limitation, the NASDAQ Global Select Market, the NASDAQ Global Market or the NASDAQ Capital Market, as applicable) or, if not listed on such exchange, on any other national securities exchange on which the shares of Common Stock of the Corporation are listed or, if not listed on any such other national securities exchange, the NASD OTC Bulletin Board or any other quotation facility on which the             shares of Common Stock of the Corporation are quoted; provided, however, that if there is no regular trading market for such shares of Common Stock of the Corporation, the market value per share shall be determined in good faith by the Board of Directors.

(i) Voting Rights. The Series A Preferred Stock shall have no voting rights except as stated in this Section 6, as required under the DGCL or as otherwise required by applicable law. Except for the issuance of Preferred Stock in connection with any Stockholder Rights Plan, so long as any shares of the Series A Preferred Stock remain outstanding, the Corporation shall not, without the vote or written consent of the holders of at least two thirds of the then outstanding shares of the Series A Preferred Stock, authorize or issue, or obligate itself to issue, any other equity security (including any security convertible into or exercisable for any equity security) senior to or pari passu with the Series A Preferred Stock as to dividend rights, conversion rights, redemption rights or liquidation preferences.

7. Transfer of Shares by Initial Holders. The Series A Preferred Stock may be transferred only to (i) a third party so long as all shares of Series A Preferred Stock are transferred to a single entity and such entity is not involved in the research, development, manufacture, marketing, sale or distribution of implantable intraocular lenses, and related devices or glaucoma wicks, or (ii) affiliates of Canon Inc. or Canon Marketing Japan Inc. Upon any transfer or purported transfer of shares of Series A Preferred Stock to any other party, such shares will automatically be converted into Common Stock on the date of such transfer or purported transfer at the Conversion Ratio in effect on such date, and the certificate(s) therefor shall be deemed cancelled and to be evidence only of the Conversion Shares issuable with respect to the shares of Series A Preferred Stock enumerated on such certificate. The certificates for the shares of Series A Preferred Stock shall bear a legend, in addition to any other legends required by law, regulation or contract, as follows:

“The transfer of Series A Preferred Stock is restricted by the Certificate of Designation, a copy of which may be obtained from the Secretary of the Corporation. Any transfer or attempted transfer not permitted under the Certificate of Designation shall result in the immediate conversion of the shares evidenced by this certificate into shares of Common Stock in the amount specified in the Certificate of Designation and the immediate termination of all rights, preferences and privileges of such shares of Series A Preferred Stock.”

8. Notices. Any notice required by the provisions of this Certificate of Designation shall be in writing, shall be deemed effectively given when addressed to each holder of record at the address of such holder appearing on the stock register of the Series A Preferred Stock, and shall be deemed given: (i) upon personal delivery to the party to be notified, (ii) when sent by confirmed facsimile if sent during normal business hours of the recipient, or if not, then on the next business day, (iii) five (5) days after having been sent by certified mail, return receipt requested, air mail postage prepaid, or (iv) three (3) days after deposit with a nationally recognized overnight courier, specifying next day delivery, with written verification of receipt. The holder or holders of a majority of the outstanding shares of Series A Preferred Stock may, at any time upon written notice to the Corporation, waive the time, but not below five (5) days, for notice pursuant to any notice provisions specified herein for the benefit of such holders, and any such waiver shall be binding upon all holders of such securities.

9. Transfer or Assignment. The rights of the Corporation hereunder (but not its obligations) may be transferred or assigned. Except as expressly set forth in Section 8, neither the Series A Convertible Preferred Stock nor any rights associated therewith may be transferred or assigned by the holder.

10. Ranking. Other than shares of Preferred Stock issued pursuant to a Stockholder Rights Plan, the shares of Series A Preferred Stock shall rank senior to all other series of the Preferred Stock and to any other class of Preferred Stock that hereafter may be issued by the Corporation as to the payment of dividends and the distribution of assets upon liquidation.

11. Reacquired Shares. Any shares of Series A Preferred Stock redeemed, converted or otherwise acquired by the Corporation in any manner whatsoever shall be retired and cancelled promptly after the acquisition thereof. All such shares shall, upon their cancellation, become authorized but unissued shares of Preferred Stock and may be reissued as part of a new series of Preferred Stock to be created by resolution or resolutions of the Board of Directors.

The next page is the signature page.

6

IN WITNESS WHEREOF, STAAR Surgical Company caused this Certificate of Designation to be signed by its President and Secretary this      day of      , 2007.

David Bailey

President

Charles Kaufman

Secretary

7

Exhibit C

[List of patents owned by the Company]

8

Exhibit D

[List of inventory owned by CMJ as of October 19, 2007]

9

Exhibit E

[Seller’s Certificate]

10

CANON INC.

SELLER’S CERTIFICATE

CANON INC., a kabushiki kaisha incorporated in Japan (“CINC”), DOES HEREBY CERTIFY pursuant to the Share Purchase Agreement dated October 25, 2007 (the “Agreement”) by and between CANON MARKETING JAPAN INC., a kabushiki kaisha incorporated in Japan (“CMJ”), and CINC and STAAR SURGICAL COMPANY, a Delaware corporation (“STAAR”), as follows:

IN WITNESS WHEREOF, the undersigned has duly executed this Certificate this      day of      , 2007.

CANON INC.

By: Name:
Title:

11

CANON MARKETING JAPAN INC.

SELLER’S CERTIFICATE

CANON MARKETING JAPAN INC., a kabushiki kaisha incorporated in Japan (“CMJ”), DOES HEREBY CERTIFY pursuant to the Share Purchase Agreement dated October 25, 2007 (the “Agreement”) by and between CMJ and CANON INC., a kabushiki kaisha incorporated in Japan (“CINC”), and STAAR SURGICAL COMPANY, a Delaware corporation (“STAAR”), as follows:

IN WITNESS WHEREOF, the undersigned has duly executed this Certificate this      day of      , 2007.

CANON MARKETING JAPAN INC.

By: Name:
Title:

12

Exhibit F

[Buyer’s Certificate]

13

STAAR SURGICAL COMPANY

BUYER’S CERTIFICATE

STAAR SURGICAL COMPANY, a Delaware corporation (“STAAR”), DOES HEREBY CERTIFY pursuant to the Share Purchase Agreement dated October 25, 2007 (the “Agreement”) by and between CANON MARKETING JAPAN INC., a kabushiki kaisha incorporated in Japan (“CMJ”), and CANON INC., a kabushiki kaisha incorporated in Japan (“CINC”), and STAAR as follows:

IN WITNESS WHEREOF, the undersigned has duly executed this Certificate this      day of      , 2007.

STAAR SURGICAL COMPANY

By: Name:
Title:

14

Exhibit G

[The Company’s Certificate]

15

STAAR JAPAN, INC.

COMPANY’S CERTIFICATE

STAAR JAPAN, INC., formerly CANON STAAR CO., INC., a kabushiki kaisha incorporated in Japan (the “Company”), DOES HEREBY CERTIFY pursuant to the Share Purchase Agreement dated October 25, 2007 (the “Agreement”) by and between CANON MARKETING JAPAN INC., a kabushiki kaisha incorporated in Japan (“CMJ”), and CANON INC., a kabushiki kaisha incorporated in Japan (“CINC”), and STAAR SURGICAL COMPANY, a Delaware corporation (“STAAR”), as follows:

IN WITNESS WHEREOF, the undersigned has duly executed this Certificate this      day of      , 2007.

STAAR JAPAN, INC.

By: Name:
Title:

Exhibit H

[Inventory Sales Agreement]

16

INVENTORY SALES AGREEMENT

This Inventory Sales Agreement (the “Agreement”) is entered into on      , 2007, by and between CANON MARKETING JAPAN INC. (“Seller”), a kabushiki kaisha organized and existing under the laws of Japan, and STAAR JAPAN, INC., formerly CANON STAAR CO., INC. (“Purchaser”), a kabushiki kaisha organized and existing under the laws of Japan. Seller and Purchaser are sometimes referred to herein individually as a “Party” and collectively as the “Parties.”

RECITALS

Whereas, pursuant to that certain Joint Venture Agreement by and between Seller and Canon Inc. (“CINC”), a kabushiki kaisha organized and existing under the laws of Japan, and STAAR Surgical Company (“STAAR”), a corporation organized and existing under the laws of the State of Delaware, dated May 23, 1988 (the “JVA”), Seller became a shareholder of Purchaser;

Whereas, pursuant to that certain Share Purchase Agreement entered into as of October 25, 2007 by and between STAAR and Seller and CINC (the “Share Purchase Agreement”), STAAR agreed to purchase from Seller and CINC, and Seller and CINC agreed to sell to STAAR, their shares of Purchaser;

Whereas, Seller has acted as a distributor of Purchaser pursuant to the terms of the JVA;

Whereas, Seller currently has in its inventory products purchased from Purchaser;

Whereas, as a condition to the Share Purchase Agreement, the parties thereto agreed to execute or cause the execution of this Agreement; and

Whereas, Seller wishes to sell to Purchaser and Purchaser wishes to repurchase from Seller all of Seller’s existing inventory of products manufactured by Purchaser.

AGREEMENT

Now, therefore, in consideration of the mutual promises herein made, and in consideration of the representations, warranties, and covenants herein contained, the Parties agree as follows.

For purposes of this Agreement, “Accounts Receivable” shall mean the outstanding amounts of accounts receivable that are owed to Purchaser by Seller and “Accounts Payable” shall mean the outstanding amounts of accounts payable that are owed to Seller by Purchaser.

If to Seller:

Canon Marketing Japan Inc.
16-6, Konan 2-chome,
Minato-ku, Tokyo 108-8011, Japan
Attention: Hiroshi Shibuya, Managing Director, President of Industrial Equipment Co.
Facsimile: 81-3-3740-3389

With a copy to:

Jones Day
Shiroyama MT Bldg.
1-17, Toranomon 4-chome, Minato-ku,
Tokyo 105-0001
Japan
Attention: Scott Jones
Facsimile: 81-3-5401-2725

If to Purchaser:

IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed as of the day and year first written above.

CANON MARKETING JAPAN INC.

STAAR JAPAN, INC.

17

Annex I

[Inventory]

18

Annex II

[Consignment Inventories]

19

Exhibit I-1
[Current Employees Secondment Agreement]

20

CURRENT EMPLOYEES SECONDMENT AGREEMENT

This Current Employees Secondment Agreement (the “Agreement”) is entered into on [ ], 2007, by and between CANON MARKETING JAPAN INC. (“CMJ”), a kabushiki kaisha organized and existing under the laws of Japan, and STAAR JAPAN, INC., formerly CANON STAAR CO., INC. (the “Company”), a kabushiki kaisha organized and existing under the laws of Japan. CMJ and the Company are sometimes referred to herein individually as a “Party” and collectively as the “Parties.”

RECITALS

Whereas, pursuant to that certain Joint Venture Agreement between CMJ and Canon Inc. (“CINC”), a kabushiki kaisha organized and existing under the laws of Japan, and STAAR Surgical Company (“STAAR”), a corporation organized and existing under the laws of the State of Delaware, dated May 23, 1988, CMJ became a shareholder of the Company;

Whereas, pursuant to that certain Secondment Agreement dated January 1, 1998 by and between CMJ and the Company (the “Current Agreement”), CMJ has seconded certain of its employees to the Company to assist in the marketing of the products of the Company (individually an “Existing Seconded Employee” and collectively the “Existing Seconded Employees”);

Whereas, as of January 1, 2006, Takashi Masuda, an Existing Seconded Employee (the “CINC Seconded Employee”), chose to become an employee of CINC who was then seconded to CMJ while still being on secondment to the Company, as a result of which, the CINC Seconded Employee has been seconded to the Company by CMJ in his capacity as a secondee to CMJ from CINC since January 1, 2006;

Whereas, pursuant to that certain Share Purchase Agreement entered into as of October 25, 2007 by and between STAAR and CMJ and CINC (the “Share Purchase Agreement”), STAAR agreed to purchase from each of CMJ and CINC, and each of CMJ and CINC agreed to sell to STAAR, their shares of the Company;

Whereas, the Share Purchase Agreement required the execution of this Agreement; and

Whereas, CMJ and the Company wish to establish a new secondment arrangement pursuant to this Agreement which will supersede the Current Agreement.

AGREEMENT

Now, therefore, in consideration of the mutual promises herein made, and in consideration of the representations, warranties, and covenants herein contained, the Parties agree as follows.

11. Rent Allowance. Any Seconded Employee who is single shall be entitled to a rent allowance to be paid by CMJ in the amount to be calculated in accordance with the CMJ Rules.

12. Social Insurance etc.

13. Accident Compensation.

14. Education and Training. Where necessary, CMJ may cause the Seconded Employees to participate in its education or training programs to the extent it does not interfere with their work at the Company.

15. Notification of Cash Reward. In the event any of the Seconded Employees receives a cash reward or any other form of cash from the Company or any third party in a sales competition or any other event in relation to the marketing and service activities of the Company, the Company shall notify the amount, timing of payment, name of payer and other relevant matters to CMJ.

16. Suspension and Resignation.

17. Disciplinary Punishment and Dismissal.

18. Notification. CMJ and the Company shall notify each other of the following regarding each Seconded Employee at the time specified for each item:

(a) Matters to be notified by CMJ to the Company

(b) Matters to be notified by the Company to CMJ

(iii) Twelve-month calendar of the Company indicating working days and holidays

Each time of issuance of such calendar

Matters relating to cash rewards under Section 15

Each time of granting of rewards

(v) Other matters which CMJ deems necessary and approved by the Company

When separately designated by the Parties

19. CMJ Employment. Notwithstanding this Agreement, the Seconded Employees (other than the CINC Seconded Employee) shall remain in the employment of CMJ and CMJ shall remain fully responsible for all the obligations of an employer to an employee in accordance with the terms and conditions of employment with CMJ.

20. CINC Employment. Notwithstanding this Agreement, the CINC Seconded Employee shall remain in the employment of CINC, and the work rules and other related regulations of CINC shall apply instead of the CMJ Rules to the CINC Seconded Employee and references to CMJ herein shall be replaced by CINC, where appropriate.

21. Liability and Indemnification. During the Term of this Agreement, so long as a Seconded Employee is acting pursuant to instructions from management of the Company or otherwise in the ordinary course of business, in accordance with the scope of his or her terms of secondment under this Agreement and in the case of a conflict of interests between the Company and CMJ or CINC, in accordance with his or her duty to act in good faith to and in the best interests of the Company pursuant to such terms of secondment:

a. the Company shall indemnify CMJ, or in the case of the CINC Seconded Employee, CMJ and CINC, against any claims or proceedings against CMJ or CINC, as applicable, as a result of any act or omission of the Seconded Employees working on secondment to the Company which is related to the performance by any Seconded Employee of his or her duties hereunder; and

b. CMJ shall not be liable to the Company for any act or omission, error or judgment (whether negligent or not) on the part of any Seconded Employee.

22. Relationship of the Parties. The Parties are independent contractors under this Agreement and no other relationship is intended, including a partnership, franchise, joint venture, agency, employer/employee, or master/servant relationship. Neither Party shall act in a manner which expresses or implies a relationship other than that of independent contractor, nor bind the other Party. The Parties shall act in good faith at all times with each other.

23. No Third-Party Beneficiary Rights. Nothing in this Agreement, express or implied, shall confer upon any employee of CMJ, or upon any representative of such employee, or upon any person claiming through such employee, or upon any collective bargaining agent, any rights or remedies, including any right to employment or continued employment for any specified period, of any nature or kind whatsoever. Nothing in this Agreement, express or implied, shall be deemed to confer upon any individual (or any beneficiary thereof) any rights under or with respect to any plan, program, or arrangement described in or contemplated by this Agreement, and each individual (and any beneficiary thereof) shall be entitled to look only to the express terms of any such plan, program, or arrangement for his or her rights hereunder. Nothing in this Agreement, express or implied, shall create a third-party beneficiary relationship or otherwise confer any benefit, entitlement, or right upon any person or entity other than the Parties hereto. Nothing in this Agreement shall cause duplicate benefits to be paid or provided to or with respect to a Seconded Employee under any employee benefit policies, plans, arrangements, programs, practices, or agreements.

24. Miscellaneous.

24.1 Amendments. This Agreement may not be changed, altered, waived or, terminated unless in writing and signed by or on behalf of each of the Parties to this Agreement.

24.2 Successors and Assigns. All of the terms of the Agreement shall be binding upon, inure solely to the benefit of and be enforceable by the successors and assigns of the Parties. Except as otherwise expressly provided in this Agreement, neither Party shall assign any of its respective rights or obligations under this Agreement to any other party without the prior written consent of the other Party, which consent shall not be unreasonably withheld.

24.3 Notices. Unless otherwise agreed upon, any notice, request, claim or other communication under this Agreement to the Parties at their respective addresses set forth below or any other address as duly notified, shall be deemed to have been duly given or made (a) when received if personally delivered or if sent by facsimile with confirmed answer back, or (b) within five (5) business days of being sent by registered mail, return receipt requested, postage prepaid or by priority delivery by established international courier:

If to CMJ:

Canon Marketing Japan Inc.
16-6, Konan 2-chome,
Minato-ku, Tokyo 108-8011, Japan
Attention: Hiroshi Shibuya, Manging Director, Hiroshi Shibuya, Managing Director, President of Industrial Equipment Co.
Facsimile: 81-3-3740-3389

With a copy to:

Jones Day
Shiroyama MT Bldg.
1-17, Toranomon 4-chome, Minato-ku,
Tokyo 105-0001
Japan
Attention: Scott Jones
Facsimile: 81-3-5401-2725

If to the Company:

24.4 Complete Agreement. This Agreement, the Share Purchase Agreement and the other Ancillary Agreements (as defined in the Share Purchase Agreement) constitute the entire agreement between the Parties relating to the transactions contemplated hereby and supersedes all prior agreements, arrangements and understandings related to the subject matter hereof including, without limitation, the Current Agreement. Any oral representations or modifications concerning this Agreement shall be of no force or effect unless contained in a subsequent written modification signed by the Party to be bound.

24.5 Headings. The use of headings in this Agreement is for convenience of reference only and will not be construed to limit, broaden or affect the meanings of the provisions contained in each section.

24.6 Injunctive Relief. Each Party agrees that the other Party shall be entitled to (i) any kind of injunction to prevent breaches of the provisions of this Agreement and (ii) enforce specifically this Agreement and the terms and provisions hereof in any action instituted in any court having jurisdiction over the Parties or the subject matter hereof, in addition to any other remedy to which such Party may be entitled at law. The Parties agree that, in the event of breach or threatened breach of the provisions of this Agreement, the damage or imminent damage to the value and the goodwill of the non-breaching Party will be irreparable and extremely difficult to estimate, making any remedy at law or in damages inadequate.

24.7 Severability. In the event that any one or more of the provisions of this Agreement should for any reason be held by the competent authorities to be invalid, illegal or unenforceable, such provision or provisions shall be reformed or renegotiated to as nearly approximate the original reasonable intent of the Parties as possible with regard to this Agreement, the Share Purchase Agreement and the other Ancillary Agreements.

24.8 Waivers. The failure of a Party to insist upon strict performance of any provision of this Agreement will not constitute a waiver of, or prevent assertion of, the right to require such performance in the future or performance of a later breach of this Agreement.

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

24.10 Arbitration. Each Party shall use its reasonable commercial efforts to solve, through mutual consultation, without recourse to arbitration, any disputes or differences which might arise in connection with this Agreement. However, all disputes, controversies or differences which may arise between the parties hereto, out of or in relation to or in connection with this Agreement shall be finally settled by arbitration in Tokyo, Japan in accordance with the Commercial Arbitration Rules of the Japan Commercial Arbitration Association. Notwithstanding the foregoing, the Parties are permitted to seek injunctive relief from a court having jurisdiction pursuant to the provisions of Section 24.6, including without limitation, to enforce any interim award or award of injunctive relief by any arbitrator. The language of the arbitration shall be English. The arbitral award shall be final, binding and conclusive on the Parties, with no further rights of appeal. Judgment upon the award rendered may be entered in any court having jurisdiction or application may be made to such court for a judicial acceptance of the award and an order of enforcement, as the case may be.

24.11 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of Japan other than the conflicts of laws rules thereof.

24.12 Language of Agreement. This Agreement is executed in the English language, and the English version of this Agreement shall control any translation of this Agreement into any other language.

24.13 Attorneys Fees and Expenses. Except as otherwise specifically provided herein, the Parties hereto shall pay their own expenses, including attorneys’ fees, incident to the preparation and performance of this Agreement, whether or not the transactions contemplated herein are consummated.

24.14 Additional Actions. Each of the Parties hereto shall execute and deliver such other documents and do such other acts and things as may be necessary or desirable to carry out the terms, provisions and purposes of this Agreement.

24.15 Consultations. Any question arising from or in connection with this Agreement or any matter not set forth in this Agreement shall be determined separately by the Parties in light of the purposes of this Agreement.

24.16 Termination of Current Agreement. The Current Agreement is hereby terminated in its entirety, including the termination of all rights and obligations therein notwithstanding any provisions to the contrary contained therein.

21

N WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed as of the day and year first written above.

CANON MARKETING JAPAN INC.

STAAR JAPAN, INC.

22

Annex I

[Seconded Employees]

23

Annex I

[Seconded Employees]

24

Exhibit I-2

[New Employees Secondment Agreement]

25

NEW EMPLOYEES SECONDMENT AGREEMENT

This New Employees Secondment Agreement (the “Agreement”) is entered into on October 25, 2007, by and between CANON MARKETING JAPAN INC. (“CMJ”), a kabushiki kaisha organized and existing under the laws of Japan, and STAAR JAPAN, INC., formerly CANON STAAR CO., INC. (the “Company”), a kabushiki kaisha organized and existing under the laws of Japan. CMJ and the Company are sometimes referred to herein individually as a “Party” and collectively as the “Parties.”

RECITALS

Whereas, pursuant to that certain Joint Venture Agreement between CMJ and Canon Inc. (“CINC”), a kabushiki kaisha organized and existing under the laws of Japan, and STAAR Surgical Company (“STAAR”), a corporation organized and existing under the laws of the State of Delaware, dated May 23, 1988, CMJ became a shareholder of the Company;

Whereas, pursuant to that certain Secondment Agreement dated January 1, 1998 by and between CMJ and the Company (the “Current Agreement”), CMJ has seconded certain of its employees to the Company to assist in the marketing of the products of the Company;

Whereas, the Current Agreement is being superseded by that certain Current Employees Secondment Agreement as of the date of this Agreement by and between CMJ and the Company;

Whereas, pursuant to that certain Share Purchase Agreement entered into as of October 25, 2007 by and between STAAR and CMJ and CINC (the “Share Purchase Agreement”), STAAR agreed to purchase from each of CMJ and CINC, and each of CMJ and CINC agreed to sell to STAAR, their shares of the Company;

Whereas, the Share Purchase Agreement required the execution of this Agreement; and

Whereas, CMJ and the Company wish to establish a new secondment arrangement pursuant to this Agreement, which will include secondment of additional employees (individually a “Seconded Employee” and collectively the “Seconded Employees”) from CMJ to the Company.

AGREEMENT

Now, therefore, in consideration of the mutual promises herein made, and in consideration of the representations, warranties, and covenants herein contained, the Parties agree as follows.

1. Seconded Employees. As of the date of this Agreement, CMJ agrees to make available to the Company the Seconded Employees. A list of the Seconded Employees and their respective positions is attached hereto as Annex I. CMJ hereby confirms that the Seconded Employees have been informed of the work conditions, compensation and other matters relating to their secondment to the Company hereunder.

The term of this Agreement shall commence on the date of this Agreement and shall expire twelve (12) months thereafter (the “Term”). At the end of the Term, each Seconded Employee shall leave the Company, and with respect to the Seconded Employees who return to CMJ, CMJ shall be responsible for obligations of an employer to such Seconded Employees from and after the Term. In no event shall the Company be responsible for obligations of an employer to such Seconded Employees from and after the Term unless an affirmative agreement is entered into by and between such Seconded Employee and the Company.

In the event any of the Seconded Employees is asked to work for a competitor of CMJ or CINC or the Company undergoes a Change of Control (as defined below), each of CMJ and, in the event of a Change of Control, the Company shall have the right to terminate this Agreement or any secondment arrangement with respect to such Seconded Employee. In no event shall the Company be liable for any salary, severance payments or payments for any accrued but unused vacation days or other obligations, if any, payable to any Seconded Employees for periods after termination of this Agreement pursuant to this Section 2.2 or upon expiry of the Term pursuant to Section 2.1. “Change of Control” in this Section 2.2 shall mean, with respect to the Company, an acquisition by any third party by merger, or purchase of a majority of the voting stock or substantially all the assets or business of the Company, or any entity which directly or indirectly Controls (as defined below) the Company, or any other material change in the ownership or Control of the Company, or any entity which directly or indirectly Controls the Company. “Control” by any party with respect to any other party shall mean the direct or indirect control of fifty percent (50%) or more of the voting stock or other ownership interest by such party of the other party, or if such party possesses the power to direct or cause the direction of the management and policies of the other party or the power to elect or appoint fifty percent (50%) or more of the members of the governing body of the other party.

At any time during the Term or upon expiry of the Term, any Seconded Employee who wishes to become a full-time employee at the Company may resign from CMJ and apply for employment at the Company. No assurance of such employment shall be given by CMJ either to the Company or to the Seconded Employee. The Company may, in its sole discretion, determine whether or not to establish an employment relationship with any such Seconded Employee.

3. Change of Duties and Positions. Any changes to the positions or duties of the Seconded Employees during the Term shall be separately determined by the Parties.

4. Code of Conduct. Except as otherwise provided in this Agreement, the Seconded Employees shall be expected to, and will, comply fully with the Code of Conduct Policy under the work rules and other employment related regulations of the Company (including, without limitation, any rules or regulations relating to confidentiality and assignment of inventions) in effect as of the date of this Agreement (collectively, the “Company Rules”) during the Term while being on the premises of the Company. The Company shall advise and provide reasonable information to each Seconded Employee as to the Company’s Code of Conduct Policy and the Company Rules.

5. Support. The Company shall provide at its sole expense, reasonable office space for each of the Seconded Employees together with appropriate workstations and equipment and such information, data and support as necessary for each Seconded Employee to perform his or her responsibilities and duties under this Agreement.

6. Work Hours, Holidays, etc.

7. Compensation, Bonuses and Employee Benefits. Each Seconded Employee shall be entitled to compensation, bonuses and employee benefits based on his or her performance at the Company as set forth below.

8. Commuting Allowance. CMJ shall provide a commuting allowance to each Seconded Employee in accordance with the CMJ Rules, and the Company shall reimburse the equivalent amount to CMJ upon CMJ’s request.

9. Travel Costs, Transportation Costs etc. Each Seconded Employee shall be entitled to recover travel costs, transportation costs, etc. as set forth below.

10. Fees.

11. Rent Allowance. Any Seconded Employee who is single shall be entitled to rent allowance to be paid by CMJ in the amount to be calculated in accordance with the CMJ Rules.

12. Social Insurance etc.

13. Accident Compensation.

14. Education and Training. Where necessary, CMJ may cause the Seconded Employees to participate in its education or training programs to the extent it does not interfere with their work at the Company.

15. Notification of Cash Reward. In the event any of the Seconded Employees receives a cash reward or any other form of cash from the Company or any third party in a sales competition or any other event in relation to the marketing and service activities of the Company, the Company shall notify the amount, timing of payment, name of payer and other relevant matters to CMJ.

16. Suspension and Resignation.

17. Disciplinary Punishment and Dismissal.

18. Notification. CMJ and the Company shall notify each other of the following regarding each Seconded Employee at the time specified for each item:

(a) Matters to be notified by CMJ to the Company

(i) Personal History At the time of commencement of secondment

(ii) Premiums paid for the workers’ accidents compensation insurance program

At the time of commencement of secondment

Each time of change in amount

(iii) Other matters which the Company deems necessary and approved by CMJ

When separately designated by the Parties

(b) Matters to be notified by the Company to CMJ

Every month

(ii) Change of work rules of the Company Each time of change

(iii) Twelve-month calendar of the Company indicating working days and holidays

Each time of granting of rewards

(v) Other matters which CMJ deems necessary and approved by the Company

When separately designated by the Parties

19. CMJ Employment. Notwithstanding this Agreement, the Seconded Employees shall remain in the employment of CMJ and CMJ shall remain fully responsible for all the obligations of an employer to an employee in accordance with the terms and conditions of employment with CMJ.

20. Liability and Indemnification. During the Term of this Agreement, so long as a Seconded Employee is acting pursuant to instructions from management of the Company or otherwise in the ordinary course of business, in accordance with the scope of his or her terms of secondment under this Agreement and in the case of a conflict of interests between the Company and CMJ, in accordance with his or her duty to act in good faith to and in the best interests of the Company pursuant to such terms of secondment:

a. the Company shall indemnify CMJ against any claims or proceedings against CMJ as a result of any act or omission of the Seconded Employees working on secondment to the Company which is related to the performance by any Seconded Employee of his or her duties hereunder; and

b. CMJ shall not be liable to the Company for any act or omission, error or judgment (whether negligent or not) on the part of any Seconded Employee.

21. Relationship of the Parties. The Parties are independent contractors under this Agreement and no other relationship is intended, including a partnership, franchise, joint venture, agency, employer/employee, or master/servant relationship. Neither Party shall act in a manner which expresses or implies a relationship other than that of independent contractor, nor bind the other Party. The Parties shall act in good faith at all times with each other.

22. No Third-Party Beneficiary Rights. Nothing in this Agreement, express or implied, shall confer upon any employee of CMJ, or upon any representative of such employee, or upon any person claiming through such employee, or upon any collective bargaining agent, any rights or remedies, including any right to employment or continued employment for any specified period, of any nature or kind whatsoever. Nothing in this Agreement, express or implied, shall be deemed to confer upon any individual (or any beneficiary thereof) any rights under or with respect to any plan, program, or arrangement described in or contemplated by this Agreement, and each individual (and any beneficiary thereof) shall be entitled to look only to the express terms of any such plan, program, or arrangement for his or her rights hereunder. Nothing in this Agreement, express or implied, shall create a third-party beneficiary relationship or otherwise confer any benefit, entitlement, or right upon any person or entity other than the Parties hereto. Nothing in this Agreement shall cause duplicate benefits to be paid or provided to or with respect to a Seconded Employee under any employee benefit policies, plans, arrangements, programs, practices, or agreements.

23. Miscellaneous.

23.1 Amendments. This Agreement may not be changed, altered, waived or, terminated unless in writing and signed by or on behalf of each of the Parties to this Agreement.

23.2 Successors and Assigns. All of the terms of the Agreement shall be binding upon, inure solely to the benefit of and be enforceable by the successors and assigns of the Parties. Except as otherwise expressly provided in this Agreement, neither Party shall assign any of its respective rights or obligations under this Agreement to any other party without the prior written consent of the other Party, which consent shall not be unreasonably withheld.

23.3 Notices. Unless otherwise agreed upon, any notice, request, claim or other communication under this Agreement to the Parties at their respective addresses set forth below or any other address as duly notified, shall be deemed to have been duly given or made (a) when received if personally delivered or if sent by facsimile with confirmed answer back, or (b) within five (5) business days of being sent by registered mail, return receipt requested, postage prepaid or by priority delivery by established international courier:

If to CMJ:

Canon Marketing Japan Inc.
16-6, Konan 2-chome,
Minato-ku, Tokyo 108-8011, Japan
Attention: Hiroshi Shibuya, Managing Director, President of Industrial Equipment Co.
Facsimile: 81-3-3740-3389

With a copy to:

Jones Day
Shiroyama MT Bldg.
1-17, Toranomon 4-chome, Minato-ku,
Tokyo 105-0001
Japan
Attention: Scott Jones
Facsimile: 81-3-5401-2725

If to the Company:

STAAR Japan, Inc.

23.4 Complete Agreement. This Agreement, the Share Purchase Agreement and the other Ancillary Agreements (as defined in the Share Purchase Agreement) constitute the entire agreement between the Parties relating to the transactions contemplated hereby and supersedes all prior agreements, arrangements and understandings related to the subject matter hereof including, without limitation, the Current Agreement. Any oral representations or modifications concerning this Agreement shall be of no force or effect unless contained in a subsequent written modification signed by the Party to be bound.

23.5 Headings. The use of headings in this Agreement is for convenience of reference only and will not be construed to limit, broaden or affect the meanings of the provisions contained in each section.

23.6 Injunctive Relief. Each Party agrees that the other Party shall be entitled to (i) any kind of injunction to prevent breaches of the provisions of this Agreement and (ii)enforce specifically this Agreement and the terms and provisions hereof in any action instituted in any court having jurisdiction over the Parties or the subject matter hereof, in addition to any other remedy to which such Party may be entitled at law. The Parties agree that, in the event of breach or threatened breach of the provisions of this Agreement, the damage or imminent damage to the value and the goodwill of the non-breaching Party will be irreparable and extremely difficult to estimate, making any remedy at law or in damages inadequate.

23.7 Severability. In the event that any one or more of the provisions of this Agreement should for any reason be held by the competent authorities to be invalid, illegal or unenforceable, such provision or provisions shall be reformed or renegotiated to as nearly approximate the original reasonable intent of the Parties as possible with regard to this Agreement, the Share Purchase Agreement and the other Ancillary Agreements.

23.8 Waivers. The failure of a Party to insist upon strict performance of any provision of this Agreement will not constitute a waiver of, or prevent assertion of, the right to require such performance in the future or performance of a later breach of this Agreement.

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

23.10 Arbitration. Each Party shall use its reasonable commercial efforts to solve, through mutual consultation, without recourse to arbitration, any disputes or differences which might arise in connection with this Agreement. However, all disputes, controversies or differences which may arise between the parties hereto, out of or in relation to or in connection with this Agreement shall be finally settled by arbitration in Tokyo, Japan in accordance with the Commercial Arbitration Rules of the Japan Commercial Arbitration Association. Notwithstanding the foregoing, the Parties are permitted to seek injunctive relief from a court having jurisdiction pursuant to the provisions of Section 23.6, including without limitation, to enforce any interim award or award of injunctive relief by any arbitrator. The language of the arbitration shall be English. The arbitral award shall be final, binding and conclusive on the Parties, with no further rights of appeal. Judgment upon the award rendered may be entered in any court having jurisdiction or application may be made to such court for a judicial acceptance of the award and an order of enforcement, as the case may be.

23.11 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of Japan other than the conflicts of laws rules thereof.

23.12 Language of Agreement. This Agreement is executed in the English language, and the English version of this Agreement shall control any translation of this Agreement into any other language.

23.13 Attorneys Fees and Expenses. Except as otherwise specifically provided herein, the Parties hereto shall pay their own expenses, including attorneys’ fees, incident to the preparation and performance of this Agreement, whether or not the transactions contemplated herein are consummated.

23.14 Additional Actions. Each of the Parties hereto shall execute and deliver such other documents and do such other acts and things as may be necessary or desirable to carry out the terms, provisions and purposes of this Agreement.

23.15 Consultations. Any question arising from or in connection with this Agreement or any matter not set forth in this Agreement shall be determined separately by the Parties in light of the purposes of this Agreement.

IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed as of the day and year first written above.

STAAR JAPAN, INC.

26

Annex I

[Seconded Employees]

27

Exhibit J

[Termination Agreement]

28

TERMINATION AGREEMENT

This Termination Agreement (this “Agreement”), is entered into on      , 2007 by and among STAAR SURGICAL COMPANY. (“STAAR”), a company organized and existing under the laws of the State of Delaware, United States of America, STAAR JAPAN, INC., formerly CANON STAAR CO., INC. (the “Company”), CANON INC. (“CINC”), and CANON MARKETING JAPAN INC. (“CMJ”), each a kabushiki kaisha organized and existing under the laws of Japan. STAAR, the Company, CINC and CMJ are sometimes referred to herein individually as a “Party” and collectively as the “Parties”. CINC and CMJ are sometimes referred to herein collectively as the “Canon Parties”.

RECITALS

Whereas, STAAR and the Canon Parties have entered into that certain Joint Venture Agreement dated May 23, 1988 (the “JVA”);

Whereas, STAAR and the Company have entered into that certain Technical Assistance and License Agreement dated September 6, 1988 (the “TALA”);

Whereas, STAAR, Canon Parties and the Company have entered into that certain Settlement Agreement dated September 28, 2001 (the “Settlement Agreement”);

Whereas, CINC and STAAR have entered into that certain Confidentiality Agreement dated May 12, 2005 (the “Confidentiality Agreement”);

Whereas, pursuant to that certain Share Purchase Agreement entered into as of October 25, 2007 by and between STAAR and the Canon Parties (the “Share Purchase Agreement”), STAAR agreed to purchase from the Canon Parties, and the Canon Parties agreed to sell to STAAR, their respective shares of the Company;

Whereas, as a condition to the Share Purchase Agreement, the parties thereto agreed to cause the execution of this Agreement;

Whereas, the respective parties wish to terminate the JVA, TALA and the Confidentiality Agreement in their entirety and certain parts of the Settlement Agreement; and

Whereas, CMJ and the Company wish to terminate any existing distribution agreement between CMJ and the Company.

AGREEMENT

Now, therefore, for and in consideration of the premises and the covenants hereinafter set forth, the Parties agree as follows.

“7. Upon full execution of this Agreement, Staar Surgical agrees that the case titled STAAR Surgical Company v CANON Inc., CANON Sales Co., Inc. and Norio Kuroda (United States District Court, Central District of California, Case No. 00-04835) shall be dismissed with prejudice pursuant to a document drafted by counsel to Defendants and signed by Plaintiff.”; and

“8. Upon full execution of this Agreement, CINC and CSCO agree that the Japan Commercial Arbitration Association (JCAA) Case No. 00-03, Tokyo shall be dismissed. Any document necessary for submission to the JCAA for dismissal shall be prepared by CINC, CSCO and Staar Surgical.”; and

“12. Staar Surgical, CINC and CSCO, each for itself and its successors and assigns, hereby RELEASE, WAIVE, DISCHARGE AND COVENANT NOT TO SUE each other, or each other’s parent, subsidiaries, affiliates and their present and former directors, officers, agents and employees, and each of them, from or related to any and all claims, losses, damages, costs and obligations, known or unknown, which they may now have or have ever had, arising out of, or related to, the disputes which are based on the performances, non-performances or acts made prior to the date hereof, including without limitation, those alleged in the case titled STAAR Surgical Company v CANON Inc., CANON Sales Co., Inc. and Norio Kuroda (United States District Court, Central District of California, Case No. 00-04835) and the Japan Commercial Arbitration Association (JCAA) Case No. 00-03, Tokyo, except for the parties respective obligations under this Agreement. The foregoing release, waiver, discharge and covenant not to sue shall not apply to any claims that may be made against the former president of Canon Staar, John Wolf, by Staar Surgical, CINC, CSCO or Canon Staar.”; and

“13. Each party shall bear its costs and expenses, including attorney fees, in connection with the subject matter hereof.”; and

“14. Subject to full execution hereof by the parties, this Agreement shall become effective as of the date first above written.”

If to STAAR:

STAAR Surgical Company
1911 Walker Avenue
Monrovia, California 91016, U.S.A.
Attention: Charles Kaufman
Facsimile: 1 ###-###-####

With a copy to:

Shartsis Friese LLP
One Maritime Plaza, 18th Floor
San Francisco, CA 94111
Attention: P. Rupert Russell, Esq.
Facsimile: 1 ###-###-####

If to the Company:

If to CINC:

Canon Inc.
30-2, Shimomaruko 3-chome,
Ohta-ku, Tokyo 146-8501, Japan
Attention: Masahiro Osawa, Managing Director, Group Executive of Finance & Accounting Headquarters
Facsimile: 81-3-5482-3960

With a copy to:

Jones Day
Shiroyama MT Bldg.
1-17, Toranomon 4-chome, Minato-ku,
Tokyo 105-0001
Japan
Attention: Scott Jones
Facsimile: 81-3-5401-2725

If to CMJ:

Canon Marketing Japan Inc.
16-6, Konan 2-chome,
Minato-ku, Tokyo 108-8011, Japan
Attention: Hiroshi Shibuya, Managing Director, President of Industrial Equipment Co.
Facsimile: 81-3-3740-3389

With a copy to:

Jones Day
Shiroyama MT Bldg.
1-17, Toranomon 4-chome, Minato-ku,
Tokyo 105-0001
Japan
Attention: Scott Jones
Facsimile: 81-3-5401-2725

IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed as of the day and year first written above.

[Signature page follows]

29

STAAR SURGICAL COMPANY

By:     
Name:
Title:

STAAR JAPAN, INC.

By:     
Name:
Title:

CANON INC.

By:     
Name:
Title:

CANON MARKETING JAPAN INC.

By:     
Name:
Title:

30

EXHIBIT A

Other Agreements

No provisions of this agreement survive termination.

No provisions of this agreement survive termination.

The following Articles shall survive termination of this agreement: 2 (1), 4 (1), 4 (2), 5 (1), 5 (2), 7, 8 and 9 (2).

Article 9 (2) shall survive termination of this agreement.

Article 6 shall survive termination of this agreement.

31

Exhibit K

[General Release]

_________________, 2007

Reference is made to the Share Purchase Agreement entered into as of October 25, 2007 (the “Agreement”) by and between STAAR Surgical Company and Canon Marketing Japan Inc. and Canon Inc. (collectively, the “Shareholders”) , pursuant to which the following release is made.

I,      , in my capacity as a director of STAAR JAPAN, INC., formerly known as CANON STAAR CO, INC. (the “Company”), hereby fully release and discharge each of the Shareholders and the Company and their respective directors, officers, agents and employees (individually a “Releasee” and collectively, the “Releasees”) from all rights, claims and actions, known or unknown, of any kind whatsoever, which I, in my capacity as a director of the Company, now have against any Releasee, arising out of or relating to events arising prior to or on the Closing Date (as defined in the Agreement).

Sincerely,

[Name of Director]

32

Schedule 5.11

Other Commitments to Register Securities

33