8-K

                  SECURITIES AND EXCHANGE COMMISSIONS

                         Washington, DC  20549

                   ___________________________________



                               FORM 8-K


                            CURRENT REPORT


                   Pursuant to Section 13 or 15(d) of
                   The Securities Exchange Act of 1934


                   ____________________________________




           Date of Report (Date of earliest event reported):     
                          December 29, 1997



                         BAUSCH & LOMB INCORPORATED

              (Exact name of registrant as specified in its 
                                 charter)



New York                           1-4105               16-0345235
(State or other jurisdiction     (Commission          (I.R.S. Employer
 of incorporation)               File Number)        Identification No.)



                   One Bausch & Lomb Place, Rochester NY
                                14604-2701
                  (Address of principal executive offices)                    
                                (Zip Code)


             Registrant's telephone number, including area code:      
                               (716) 338-6000



                                Inapplicable
          (Former name or former address, if changed since last 
                                  report).

ITEM 2.  ACQUISITION OR DISPOSITION OF ASSETS

a.  Acquisition of Chiron Vision Corporation

On December 29, 1997, Bausch & Lomb Incorporated (the 
"Company") acquired, for $300 million in cash, all of the 
issued and outstanding shares of Chiron Vision Corporation 
("Chiron Vision"), pursuant to an October 21, 1997 
agreement between the Company and Chiron Corporation, the 
sole shareholder of Chiron Vision.

Chiron Vision's business is the research, development and 
manufacture of innovative products that improve results in 
cataract and refractive surgery, and the treatment of 
progressive eye diseases.

Included in the assets acquired by the Company (indirectly 
through the acquisition of the shares of Chiron Vision) are 
the following products and operations:

Chiron Vision's product portfolio includes microkeratones 
and blades for LASIK refractive surgery; an advanced excimer 
laser with a built-in LASIK workstation for refractive 
surgery; equipment and viscoelastics for cataract surgery; 
PMMA and foldable intraocular lenses (IOLs); and the 
Vitrasert Implant, the first drug delivery system to provide 
local, sustained therapy for the treatment of 
cytomegalovirus (CMV) in people with AIDS.  Based in 
Claremont, California, Chiron Vision maintains owned and 
leased manufacturing and sales facilities on five 
continents.  Receivables and other contract rights of Chiron 
Vision are included in the assets obtained indirectly 
through this acquisition of capital stock.

b.  Acquisition of Storz Instrument Company

On December 31, 1997, the Company, in a combined purchase of 
stock and assets, acquired, for $380 million in cash, Storz 
Instrument Company, Storz Ophthalmics, Inc. And Cyanamid 
Chirurgie S.A.S. (collectively the "Storz Entities") 
pursuant to an October 21, 1997 agreement by and among the 
Company, American Cyanamid Company ("Cyanamid") and 
American Home Products Corporation ("AHP").

Storz manufactures and distributes high quality ophthalmic 
surgical instruments, surgical and diagnostic equipment, 
intraocular lens implants and ophthalmic pharmaceuticals.

The assets were acquired from AHP and Cyanamid directly and 
indirectly through the acquisition of the shares of Storz 
Instrument Company, Storz Ophthalmics, Inc. and Cyanamid 
Chirurgie S.A.S., as well as certain other assets.  The 
assets acquired include the following products and 
operations:

Storz surgical and diagnostic equipment products include 
technologically-advanced surgical systems that provide 
irrigation/aspiration and phacoemulsification capabilities 
utilized in ophthalmic surgery.  Intraocular lens implant 
products include over 80 models in multi-piece, single-piece 
and small-incision design.  Pharmaceutical products include 
Ocuvite, a vitamin and mineral supplement, as well as a 
number of in-office diagnostic and OTC products marketed to 
eye care professionals.  The Storz assets also include a 
comprehensive surgical instrument product line offering a 
broad range of hand-held microsurgical instruments.  Based 
in St. Louis, Missouri, Storz maintains manufacturing and 
sales facilities in several countries.  Receivables and 
other contract rights associated with the Storz business are 
also included in the assets acquired.

The funds used to consummate both of these acquisitions came 
from the issuance by the Company of short-term obligations 
under the Company's commercial paper program.

ITEM 7.  FINANCIAL STATEMENTS AND EXHIBITS

(a)(4)  Financial statements of the businesses acquired are 
not included with this report, and will be filed on or 
before March 13, 1998.

(c)  See Exhibit Index for a listing of exhibits.



                        SIGNATURES

Pursuant to the requirements of the Securities Exchange Act 
of 1934, the registrant has duly caused this report to be 
signed on its behalf by the undersigned thereunto duly 
authorized.

BAUSCH & LOMB INCORPORATED


/s/ Stephen C. McCluski
Stephen C. McCluski
Senior Vice President - Finance

Dated:  January 13, 1998


                        EXHIBIT INDEX

Exhibit No.   Description

2(a)          Stock Purchase Agreement by and between Bausch
              & Lomb Incorporated and Chiron Corporation
              dated as of October 21, 1997

2(b)          Purchase Agreement by and among American
              Cyanamid Company, American Home Products
              Corporation and Bausch & Lomb Incorporated
              dated as of October 21, 1997

EX-2

                        STOCK PURCHASE AGREEMENT

                            by and between

                       BAUSCH & LOMB INCORPORATED

                                  and

                          CHIRON CORPORATION


                       Dated as of October 21, 1997



                              	EXHIBITS

Exhibit A
Reserved

Exhibit B
Opinion of William G. Green, Esq., Counsel 
for Chiron

Exhibit C
Non-competition Agreement

Exhibit D
Opinion of Purchaser's Counsel

Exhibit E
List of Special Charges




SCHEDULES


Schedule 
1.5.1
Audited Balance Sheet

Schedule 
2.2
Noncontravention

Schedule 
2.3
Governmental Consents or Approvals

Schedule 
2.4.1
Subsidiaries of the Company

Schedule 
2.5
Directors and Officers of the Company

Schedule 
2.6.2
Capital Stock of the Company

Schedule 
2.8
Undisclosed Liabilities

Schedule 
2.9
Certain Developments of the Company

Schedule 
2.10
Real Properties of the Company

Schedule 
2.11.1
Contracts

Schedule 
2.11.2
Certain Contracts

Schedule 
2.11.3
Contract Approvals

Schedule 
2.12
Litigation

Schedule 
2.13.1
Intellectual Property

Schedule 
2.13.2
Certain Intellectual Property Matters

Schedule 
2.14
Permits

Schedule 
2.15.1
Employee Benefit Plans and Agreements

Schedule 
2.15.2
Benefit Arrangements

Schedule 
2.16
Certain Interests

Schedule 
2.17
Intercompany Transactions

Schedule 
2.21
Insurance Policies and Bonds

Schedule 
2.23
Certain FDA Matters

Schedule 
3.2
Noncontravention

Schedule 
3.3
Governmental Consents or Approvals

Schedule 
4.2.1
Commitments and Capital Expenditures

Schedule 
6.2.1
Tax Sharing Agreements

Schedule 
6.2.2
Tax and Other Returns and Reports



              STOCK PURCHASE AGREEMENT


THIS STOCK PURCHASE AGREEMENT dated as of October 21, 
1997, is made by and between Bausch & Lomb Incorporated, a 
New York corporation (the "Purchaser"), and Chiron 
Corporation, a Delaware corporation ("Chiron").


RECITALS

A.	Chiron owns 1,000 shares of Common Stock, $.01 par 
value (the "Stock"), of Chiron Vision Corporation, a 
Delaware corporation (the "Company"), constituting all of 
the issued and outstanding capital stock of the Company.

B.	The Purchaser desires to purchase the Stock, and 
Chiron desires to sell the Stock to the Purchaser, on the 
terms and conditions herein set forth.

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


ARTICLE I

Purchase and Sale

1.1	Purchase and Sale.  Upon the terms and subject to 
the conditions of this Agreement (this and other capitalized 
terms, to the extent not defined in any other Article, shall 
have the meanings assigned to such terms in Article X), 
Chiron shall sell to the Purchaser, and the Purchaser shall 
purchase from Chiron, the Stock at the Closing (as defined 
in Section 1.4) and Chiron shall deliver at the Closing the 
certificates evidencing the Stock, properly endorsed, or 
accompanied by a duly executed stock power duly endorsed, in 
blank.

1.2	Purchase Price.  In consideration for the Stock 
and as payment in full therefor, the Purchaser shall pay to 
Chiron $300,000,000 (the "Purchase Price"), subject to 
such adjustments as may be made pursuant to Section 1.5.

1.3	Payment of Purchase Price.  If the obligations of 
the parties to proceed with the Closing set forth in Article 
VII are satisfied or waived in writing by all parties, at 
the Closing, the Purchaser shall pay Chiron the Purchase 
Price by wire transfer of immediately available funds to a 
bank account designated by Chiron.  Within two business days 
of delivery to the Purchaser of the Closing Date Balance 
Sheet, the Purchaser shall pay to Chiron, or Chiron shall 
pay to the Purchaser, as the case may be, by wire transfer 
of immediately available funds, the adjustment to the 
Purchase Price, if any, determined in accordance with 
Section 1.5.

1.4	Closing.  The closing (the "Closing") of the 
purchase and sale of the Stock shall take place at the 
offices of the Purchaser's counsel in Newport Beach, 
California as soon as possible after the satisfaction or 
waiver of the conditions set forth in Article VII, or at 
such other time and place as the parties shall mutually 
agree; provided that in no event shall the Purchaser be 
required to close prior to November 1, 1997.  The date on 
which the Closing actually occurs is herein referred to as 
the "Closing Date."

1.5	Adjustments to Purchase Price.

1.5.1	Adjustment.  The Purchase Price shall be 
adjusted as follows:

(a)	If the amount of Net Assets reflected on 
the Closing Date Balance Sheet (as defined in Section 
1.5.2(a)) (the "Closing Date Net Assets") is more 
than $82,702,000 (being the amount of Net Assets 
reflected on the Audited Balance Sheet, which is 
attached as Schedule 1.5.1 and herein called the 
"Audited Balance Sheet Date Net Assets"), there will 
be an upward adjustment of the Purchase Price equal to 
fifty percent of the difference between the Closing 
Date Net Assets and the Audited Balance Sheet Net 
Assets.

(b)	If the Closing Date Net Assets are less 
than the Audited Balance Sheet Date Net Assets, there 
will be a downward adjustment of the Purchase Price 
equal to fifty percent of the difference between the 
Closing Date Net Assets and the Audited Balance Sheet 
Net Assets.

(c)	In the event Net Operating Losses of 
Chiron Adatomed reported as of December 31, 1997 are 
less than $1,000,000, there will be a downward 
adjustment of the Purchase Price equal to forty percent 
of the difference between $1,000,000 and such Net 
Operating Losses.

(d)	If any upward or downward adjustment is 
required, the increase or decrease to the Purchase 
price, as the case may be, shall be referred to herein 
as the "Upward Purchase Price Adjustment" or 
"Downward Purchase Price Adjustment", respectively.

1.5.2	Balance Sheet.

(a)	Chiron shall, at its own cost and 
expense, prepare and deliver to the Purchaser within 60 
days after the Closing Date, a consolidated balance 
sheet for the Company and its Subsidiaries (as defined 
in Section 2.4.4) as of the Closing Date (the "Closing 
Date Balance Sheet") which shall include, in addition 
to the other information set forth therein, the Closing 
Date Net Assets.  The Closing Date Balance Sheet shall 
be prepared in accordance with the Agreed Procedure, 
and shall be accompanied by an audit opinion thereon of 
KPMG Peat Marwick LLP ("KPMG") to the effect that the 
Closing Date Balance Sheet, and the assets and 
liabilities reflected thereon, were prepared and 
determined in accordance with the Agreed Procedure.  
The Closing Date Balance Sheet shall be accompanied by 
a supplementary schedule setting forth the calculation 
of the adjustment to the Purchase Price contemplated by 
Section 1.5.1.  During the sixty-day period following 
the Closing, the Purchaser will cause the Company to 
provide to Chiron and its accountants reasonable access 
during normal business hours to such books and records 
of the Company as may be necessary to enable Chiron to 
prepare the Closing Date Balance Sheet.  Chiron shall 
make available to the Purchaser all work papers, books 
and records used by it in the preparation and audit of 
the Closing Date Balance Sheet, and shall provide 
copies of the same.  The Purchaser and such accountants 
or auditors of its choice (the cost and expense of 
which shall be borne by the Purchaser) shall be 
entitled to jointly conduct with Chiron and KPMG, or 
otherwise participate in or monitor, a physical count 
of the inventories on hand as of the Closing Date (or 
such other date as the Purchaser and Chiron shall 
mutually agree) and such other procedures acceptable to 
the Purchaser with respect to any inventory on 
consignment.

(b)	The Purchaser shall have 30 business 
days after its receipt of the Closing Date Balance 
Sheet and related supplementary schedules to review 
them (the "Review Period").  On or prior to the 
expiration of the Review Period, the Purchaser shall 
notify Chiron in writing if it does not agree with 
Chiron's calculation of any adjustment to the Purchase 
Price (the "Disagreement Notice"), which notice shall 
include a brief description of the basis of its 
disagreement, including its calculation of any 
adjustment to the Purchase Price.  If Chiron does not 
receive the Disagreement Notice on or prior to the 
expiration of the Review Period, the Purchaser shall be 
deemed to have approved the Closing Date Balance Sheet 
and Chiron's calculation of any adjustment to the 
Purchase Price applicable thereto.

(c)	If Chiron receives the Disagreement 
Notice, Chiron and the Purchaser shall, in good faith, 
attempt to resolve the disagreement within 20 business 
days after Chiron's receipt of the Disagreement Notice.  
If they cannot resolve the disagreement within such 
time period, then (i) Chiron or the Purchaser, as 
applicable, shall promptly pay any net amount owed to 
the other party that is not in disagreement (i.e., net 
of any offsetting liability), and (ii) the parties 
promptly shall refer such disagreement for resolution 
to Arthur Andersen LLP, or if Arthur Andersen LLP is 
unable to serve or declines to act, or if at the time 
of such referral Arthur Andersen LLP is not independent 
of each of the Purchaser and Chiron, such other firm of 
independent accountants of recognized national standing 
as mutually selected by the Purchaser and Chiron (such 
firm being referred to herein as the "Deciding 
Accountant").  The determination of the Deciding 
Accountant as to the calculation and amount of any 
adjustment to the Purchase Price shall be rendered 
within 30 calendar days after such disagreement is 
referred to the Deciding Accountant, and shall be 
binding upon the parties hereto.

(d)	Each of the Purchaser and Chiron shall 
furnish to the Deciding Accountant, at its own cost and 
expense, such documents and information as the Deciding 
Accountant may request, and each party may also furnish 
to the Deciding Accountant such other information and 
documents as it deems relevant, in all cases with 
copies (where it would not be unreasonably costly or 
burdensome to provide copies) or notification (with 
reasonable rights of access) being given to the other 
party.  The fees and expenses payable to the Deciding 
Accountant shall be borne one-half by the Purchaser and 
one-half by Chiron.

(e)	The Closing Date Balance Sheet as agreed 
to by the parties or as determined by the Deciding 
Accountant, and the Closing Date Net Assets reflected 
thereon, shall be binding on the parties and thereafter 
be the "Closing Date Balance Sheet" and the "Closing 
Date Net Assets", respectively, for all purposes of 
this Agreement.  The later of the date on which the 
parties agree upon the Closing Date Balance Sheet and 
the calculation of any adjustment to the Purchase Price 
or the date on which the Deciding Accountant renders 
its decision with respect thereto shall be called the 
"Final Settlement Date".

(f)	Within 10 business days after the Final 
Settlement Date, (i) if the Purchase Price paid at the 
Closing is to be increased, the Purchaser shall pay to 
Chiron the Upward Purchase Price Adjustment to the 
extent not previously paid via wire transfer to an 
account of Chiron identified in writing by Chiron, and 
(ii) if the Purchase Price paid at the Closing is to be 
decreased, Chiron shall pay to the Purchaser the 
Downward Purchase Price Adjustment to the extent not 
previously paid via wire transfer to an account of the 
Purchaser identified in writing by the Purchaser.

(g)	Any adjustments to the Purchase Price 
required by application of this Section 1.5 shall be 
allocated among the Net Assets in the same manner as 
the allocation of Purchase Price required by Section 
6.9.


ARTICLE II

Representations and Warranties of Chiron

Chiron represents and warrants to the Purchaser that:

2.1	Organization and Authority of Chiron.  Chiron is a 
corporation duly organized, validly existing and in good 
standing under the laws of the State of Delaware.  Chiron 
has full power and authority to execute, deliver and perform 
this Agreement and such other documents as are contemplated 
hereunder to be executed and delivered at or prior to the 
Closing.  The execution, delivery and performance of this 
Agreement by Chiron and the consummation of the transactions 
contemplated hereby have been duly authorized by all 
necessary corporate action on the part of Chiron, the 
Company and the Subsidiaries.  This Agreement constitutes a 
valid and, assuming due execution by the Purchaser, and the 
expiration or termination of the applicable waiting period 
under the HSR Act (as defined in Section 2.3), binding 
obligation of Chiron, enforceable against Chiron in 
accordance with its terms, subject to applicable bankruptcy, 
insolvency, moratorium, reorganization or similar laws 
affecting creditors' rights generally, and to general 
equitable principles.

2.2	Noncontravention.  Except as set forth in Schedule 
2.2, the execution, delivery and performance of this 
Agreement by Chiron and the consummation of the transactions 
contemplated hereby will not violate or conflict with, or 
constitute a breach or default (whether upon lapse of time 
and/or the occurrence of any act or event or otherwise) 
under (a) the Certificate of Incorporation or bylaws of 
Chiron, the Company or any of the Subsidiaries (as defined 
in Section 2.4.4), or (b) any law, regulation, order, 
judgment, or decree applicable to any such Person, or (c) 
any material indenture, mortgage or other instrument to 
which Chiron is a party or by which it or any of its 
properties is bound.

2.3	No Governmental Consent or Approval Required.  No 
authorization, consent, Permit, approval or other order of, 
declaration to, or registration, qualification, designation 
or filing with, any governmental agency or body is required 
for or in connection with the execution, delivery and 
performance of this Agreement by Chiron and the consummation 
of the transactions contemplated hereby by Chiron, the 
Company and the Subsidiaries, other than (a) the filing of 
notification under the Hart-Scott-Rodino Antitrust 
Improvements Act of 1976 ("HSR Act") and the expiration or 
early termination of the waiting period thereunder, as well 
as certain filings under the foreign competition laws 
(together with the HSR Act, the "Competition Laws"), and 
(b) the matters identified in Schedule 2.3 as requiring that 
certain actions be taken by or with respect to any 
governmental agency or body and (c) any consents from any 
Person (other than any governmental entity or body) the 
failure to obtain which does not prohibit the transfer of 
the Stock or the consummation of any of the transactions 
contemplated hereby or create a Lien on the Stock.

2.4	Subsidiaries.

2.4.1	Capitalization, Qualification and.  The 
Company has no subsidiaries and no investments, directly or 
indirectly, in any corporation or business organization 
other than the subsidiaries and certain other investments 
listed on Schedule 2.4.1.  Schedule 2.4.1 correctly sets 
forth the capitalization of each Subsidiary (as defined in 
Section 2.4.4), the ownership of the Company or one of its 
Subsidiaries therein, the jurisdictions in which the Company 
and its Subsidiaries are organized and each jurisdiction in 
which the Company and any of its Subsidiaries is required 
(except where the failure to so qualify would not have an 
adverse effect on the business, assets, financial condition 
or results of operations of the Company or its Subsidiaries) 
to be qualified or licensed to do business as a foreign 
Person.

2.4.2	Chiron Adatomed.  The Company currently 
conducts certain business through an affiliate, Chiron 
Adatomed Pharmazeutische und medizintechnicshe Gesellschaft 
mbH ("Chiron Adatomed").  At the date of this Agreement, 
all of the outstanding capital stock of Chiron Adatomed is 
owned by Chiron.  Chiron will transfer all such outstanding 
capital stock to the Company prior to the Closing.

2.4.3	Chiron Canada.  The Company currently 
owns all of the outstanding capital stock of Chiron Vision 
Canada Inc. ("Chiron Canada"), a Canadian corporation.  
Prior to the Closing, all of the capital stock of Chiron 
Canada will be transferred to Chiron.  Chiron Canada is not 
actively engaged in the business of the Company and its 
Subsidiaries.

2.4.4	Definitions.  As used in this Agreement, 
the term "Subsidiaries" means the subsidiaries of the 
Company listed on Schedule 2.4.1 and includes Chiron 
Adatomed.

2.5	Organization and Authority of the Company and 
Subsidiaries.  Except as set forth on Schedule 2.5, the 
Company and each Subsidiary is a corporation duly organized, 
validly existing and in good standing under the laws of its 
jurisdiction of incorporation and has all corporate power 
and authority to carry on its business as presently 
conducted and to consummate the transactions contemplated 
hereby.  Except as set forth on Schedule 2.5, the Company 
and each Subsidiary is qualified to do business as a foreign 
corporation in good standing in each jurisdiction where 
failure to so qualify would have an adverse effect on the 
business, assets, financial condition or results of 
operations of the Company or any Subsidiary.  Schedule 2.5 
correctly lists the current directors and executive officers 
of the Company and the Subsidiaries.  True, correct and 
complete copies of the respective charter documents of the 
Company and the Subsidiaries as in effect on the date hereof 
have been provided to the Purchaser.

2.6	Capitalization.

2.6.1	The Company.  The entire authorized 
capital stock of the Company consists of 1,000 shares of 
Common Stock, $.01 par value, of which 1,000 shares are 
issued and outstanding.  All of the Stock has been duly 
authorized and validly issued and is outstanding, fully paid 
and nonassessable.  There are no outstanding warrants, 
options, subscription, conversion, preemptive or other 
rights entitling any person or entity to purchase or 
otherwise acquire any capital stock of the Company.  Chiron 
owns all of the Stock beneficially and of record and has 
good and valid title to all of the Stock, free and clear of 
all Liens and, subject to applicable securities laws and 
competition laws, free of any restriction on its right to 
transfer or exercise any voting or other right with respect 
thereto.  At the Closing, the Purchaser will acquire good 
and valid title to the Stock, free and clear of any Liens of 
any nature whatsoever.

2.6.2	The Subsidiaries.  Except as disclosed 
in Schedule 2.6.2, the Company owns all of the capital stock 
of each Subsidiary beneficially and of record and has good 
and valid title to all of the capital stock of each 
Subsidiary, free and clear of all Liens and, subject to 
applicable securities laws and competition laws, free of any 
restriction on its right to transfer or exercise any voting 
or other right with respect thereto and all of such shares 
of capital stock have been duly authorized and, to the 
extent applicable in the jurisdiction in which such 
Subsidiary was organized, are validly issued and 
outstanding, fully paid and non-assessable and, at the 
Closing, upon the consummation of the transactions 
contemplated hereby, the Company will continue to have good 
and valid title to all such shares of capital stock, free 
and clear of any Liens of any nature whatsoever. Except as 
disclosed on Schedule 2.6.2, there are no outstanding 
warrants, options, subscription, conversion, preemptive or 
other rights entitling any Person to purchase or otherwise 
acquire any capital stock of the Company or any Subsidiary.  
Any capital stock or other securities or equity interests of 
the Company or any Subsidiary which were issued and 
reacquired by the Company or any of such Subsidiaries were 
so reacquired (and, if reissued, so reissued) in compliance 
with all applicable laws, and neither the Company nor any 
Subsidiary has any outstanding obligation or liability with 
respect thereto.

2.7	Financial Statements.  Chiron has delivered to the 
Purchaser (a) the consolidated balance sheets of the Company 
and Subsidiaries as of December 31, 1996 (the "Audited 
Balance Sheet") and the consolidated statements of 
operations and cash flows for the year ended December 31, 
1996, accompanied by the audit report thereon of KPMG (the 
"Audited Financial Statements"), (b) the unaudited 
consolidated balance sheet of the Company and Subsidiaries 
as of March 31, 1997 (the "Q-1 Balance Sheet") and the 
unaudited consolidated statements of operations for the 
three months then ended (together with the Audited Financial 
Statements, the "Financial Statements").  The Financial 
Statements have been prepared in accordance with GAAP, 
consistently applied, and fairly and accurately present the 
financial position of the Company and the Subsidiaries as of 
the respective dates thereof and the results of operations 
and changes in financial position and, in the case of the 
Audited Financial Statements, cash flow of the Company and 
Subsidiaries for the respective periods covered thereby.  At 
the date of such balance sheets, neither the Company nor the 
Subsidiaries had any liability (actual, contingent, accrued 
or otherwise) that, in accordance with GAAP applied on a 
consistent basis, should have been shown or reflected 
therein but was not. Since December 31, 1995, there has been 
no change in any of the significant accounting policies, 
practices or procedures of the Company or any Subsidiary.

2.8	Undisclosed Liabilities.  The Company and its 
Subsidiaries have no liabilities (whether accrued, absolute, 
contingent or otherwise, and whether due or to become due, 
probable of assertion or not), except for (a) matters 
identified in Schedule 2.8, (b) liabilities fully reflected 
and expressly reserved for in the Audited Balance Sheet, (c) 
liabilities of a type not required to be reflected in the 
Company's or its Subsidiaries' balance sheet in accordance 
with GAAP, and (d) liabilities incurred in the ordinary 
course of business since December 31, 1996.

2.9	Absence of Certain Developments.  Since December 
31, 1996, except as disclosed in the Financial Statements or 
in Schedule 2.9, there has not been (a) any declaration, 
setting aside or payment of any dividend or other 
distribution with respect to the capital stock of the 
Company, (b) any loss, destruction or damage to any property 
of the Company or its Subsidiaries, whether or not insured, 
which had or could reasonably be expected to have an adverse 
effect on the business, assets, financial condition, or 
results of operations of the Company and any Subsidiary, or 
(c) any agreement, condition, action or omission which would 
be prescribed by (or requires notice or consent under) 
clause (b), (c), (d) or (g) of Section 4.2 had it existed, 
occurred, or arisen after the date of this Agreement.

2.10	Title to Properties.

2.10.1	Personal Property.  Except as disclosed 
in the Audited Financial Statements, the Company and 
Subsidiaries have good and marketable title to, or have a 
valid leasehold interest in, all of the personal properties 
and assets held, occupied or used in their respective 
businesses or otherwise purportedly owned or leased by the 
Company or any Subsidiary, free and clear of all Liens other 
than (a) the lien of current taxes not yet due and payable, 
and (b) Permitted Liens.  All such personal properties and 
assets which are material tangible properties are adequate 
for the respective businesses of the Company and its 
Subsidiaries as presently conducted.

2.10.2	Real Property.  Schedule 2.10 discloses 
and lists all real properties currently owned, used or 
leased by the Company or the Subsidiaries or in which the 
Company  or a Subsidiary has an ownership or leasehold 
interest (collectively, the "Real Property") and if owned 
identifies the record title holder of all of the Real 
Property.  Either the Company or a Subsidiary has good and 
marketable fee simple title to (or a leasehold interest in, 
as the case may be) all Real Property shown as owned (or 
leased, if applicable) by it on Schedule 2.10, free and 
clear of all Liens other than Permitted Liens.  Neither the 
Company nor any Subsidiary has received any written notice 
of assessments for public improvements or condemnation 
against any Real Property.

2.11	Contracts.  Attached as Schedule 2.11.1 is a true 
and complete list of all debt instruments, contracts, 
leases, license agreements, employment and labor agreements, 
and other agreements, commitments and understandings of any 
kind, whether or not in writing, to which the Company or any 
Subsidiary is a party or to which the Company, any 
Subsidiary or any of their respective properties is subject 
or by which any thereof is bound which is either (a) 
important to the continued conduct of the business of the 
Company and any Subsidiary as presently conducted or (b) 
which pursuant to its terms imposes payment obligations on 
either party in excess of $1 million annually or $3 million 
in the aggregate (excluding all purchase orders, sales in 
the ordinary course of business and distributorship 
contracts that are not material to the business) ("Material 
Contracts").  Except as disclosed in Schedule 2.11.2, each 
Material Contract is in full force and effect; and no breach 
or default, breach or default alleged in writing, or event 
which would (with the passage of time, notice or both) 
constitute a breach or default thereunder by the Company or 
such Subsidiary, as the case may be, in each case in any 
material respect, or, to the knowledge of Chiron, the 
Company and each Subsidiary, any other party or obligor with 
respect thereto exists and is continuing.  The execution, 
delivery and performance of this Agreement and the 
consummation of the transactions contemplated hereby will 
not result in a breach of or default under any Material 
Contract, will not (and will not give any Person a right to) 
terminate or modify any rights of, or accelerate or augment 
any obligation of, the Company or any Subsidiary, and do not 
require any consent, approval, waiver or other action by any 
party to any such Material Contract, other than the consents 
and approvals identified in Schedule 2.11.3 (the "Contract 
Approvals").

2.12	Litigation.  To the knowledge of Chiron, the 
Company and each Subsidiary except as disclosed in Schedule 
2.12, there is no written claim, filed complaint, 
arbitration, action, suit, proceeding or investigation 
pending or threatened, against, affecting or reasonably 
expected to affect the Company or any Subsidiary, including 
any claim for indemnification from the Company or a 
Subsidiary which could reasonably be expected to be asserted 
by any director, officer, employee, agent or representative 
of the Company or any Subsidiary (a) which if resolved 
adversely to the Company or any Subsidiary, as the case may 
be, would result in liability to the Company or any 
Subsidiary, or (b) seeking to prevent or challenging in any 
other manner the consummation of the transactions 
contemplated hereby.  Neither the Company nor any Subsidiary 
is a party to, or subject to the provisions of, or, to the 
knowledge of Chiron, the Company and each Subsidiary, is 
threatened with, any order, writ, injunction, judgment or 
decree of any court or governmental agency or 
instrumentality which could reasonably be expected to 
prevent the consummation of the transactions contemplated 
hereby.  There is no organized labor strike, dispute, 
slowdown or stoppage, or collective bargaining or unfair 
labor practice claim pending, or to the knowledge of Chiron, 
the Company and each Subsidiary threatened, against or 
affecting the Company or any Subsidiary, nor are there, to 
the knowledge of Chiron, the Company or any Subsidiary, any 
union organizing efforts.

2.13	Intellectual Property.

2.13.1	Patents, Trademarks.  Attached as 
Schedule 2.13.1 is a list of all registered trademarks, 
trademark applications, trade names, service marks, patents 
and patent applications owned by the Company or any 
Subsidiaries.  Schedule 2.13.1 includes as to each item 
listed thereon a registration or application number (as 
applicable).  Except as disclosed in Schedule 2.13.1, the 
Company or a Subsidiary, as the case may be, has the sole 
and exclusive rights to such registered trademarks, 
trademark applications, trade names, service marks, patents 
and patent applications and, to the knowledge of Chiron, the 
Company and each Subsidiary, no other party has asserted 
orally or in writing to the Company or any Subsidiary any 
claim with respect to or challenged the Company's or 
Subsidiary's rights with respect to such registered 
trademarks, trademark applications, trade names, service 
marks, patents and patent applications and such registered 
trademarks, trademark applications, trade names, service 
marks, patents and patent applications are free and clear of 
any Liens other than Permitted Liens.  Except as disclosed 
in Schedule 2.13.1, to the knowledge of Chiron, the Company 
and each Subsidiary, the Company or the Subsidiaries have 
ownership of or license to all of the registered trademarks, 
trademark applications, trade names, service marks, patents 
and patent applications used in connection with the business 
of the Company and the Subsidiaries, the absence of which 
would have a material adverse effect on the Company and any 
Subsidiary as presently conducted.

2.13.2	No Infringement.  Except as disclosed in 
Schedule 2.13.2, since January 1, 1993, the Company has not 
received any written (or, to the knowledge of Chiron, the 
Company or any of its Subsidiaries, oral) communications 
alleging that the Company or any of its Subsidiaries has 
infringed, violated or misappropriated any of the registered 
trademarks, trademark applications, trade names, services 
marks, patents, patent applications, copyrights or trade 
secrets of any other Person.  Except as disclosed on 
Schedule 2.13.2, there are no third party patents which 
could reasonably be expected to provide such third party 
with a colorable claim against the Company or any Subsidiary 
for infringement thereof based on acts of Chiron, the 
Company or any Subsidiary occurring prior to the Closing 
Date.

2.14	Compliance with Law; Governmental Permits.  Except 
as set forth in Schedule 2.14, to the knowledge of Chiron, 
the Company and each Subsidiary (including, without 
limitation, the Vice President of Regulatory Affairs for the 
Company), the Company and each Subsidiary is in compliance 
with all laws, regulations, orders, judgments and decrees of 
any court or governmental authority which are applicable to 
its business, including without limitation the Federal Food, 
Drug and Cosmetic Act (the "FDC Act") and the regulations 
promulgated thereunder, except in the case of the FDC ACT 
and the regulations promulgated thereunder, noncompliance 
with which could not reasonably be expected to result in any 
enforcement action by any government entity or body or the 
issuance of a warning letter by the U.S. Food and Drug 
Administration (the "FDA").  Except as disclosed in 
Schedule 2.14, to the knowledge of Chiron, the Company and 
each Subsidiary, each Permit held by the Company and its 
Subsidiaries is in full force and effect and will be upon 
consummation of the transactions contemplated by this 
Agreement.  To the knowledge of Chiron, no suspension, 
cancellation or termination of any of such Permits is 
threatened or imminent.

2.15	Employee Benefits.

2.15.1	Plans and Material Documents.

(a)	Schedule 2.15.1 lists all employee 
benefit plans and severance plans generally applicable 
to the U.S. employees of the Company or any of its 
Subsidiaries, including, without limitation, (i) any 
"employee welfare benefit plan" or "employee pension 
benefit plan" (within the meaning of Sections 3(1) or 
3(2) of ERISA) (the "Benefit Plans"), (ii) any profit 
sharing, deferred compensation, bonus, stock option, 
stock purchase, pension, retention, consulting, 
retirement, severance, welfare or incentive plan, (iii) 
any plan providing for fringe benefits or perquisites 
to employees, officers, directors or agents, or (iv) 
any employment agreement not terminable on 30 days (or 
less) written notice and providing for an annual salary 
in excess of $150,000.  The plans described in this 
Section 2.15.1 may be referred to herein as the 
"Benefit Arrangements".  Except as disclosed in 
Schedule 2.15.1, none of the Benefit Arrangements or 
any Benefit Plan or any employee pension benefit plan 
(within the meaning of Section 3(2) of ERISA) 
maintained or contributed to by any ERISA Affiliate is 
(A) a plan subject to Title IV of ERISA or (B) a 
"multiemployer plan" (within the meaning of Section 
3(37) of ERISA).  In addition, neither the Company nor 
any of its ERISA Affiliates contributes to or had an 
obligation to contribute to any multiemployer plan 
during the five year period preceding the date of this 
Agreement.  Chiron has provided to the Purchaser true 
and complete copies of all written documents and 
summary plan descriptions of the Benefit Arrangements 
made available to employees of the Company or any 
Subsidiary.  Chiron has provided to the Purchaser true 
and complete copies of the Form 5500 filed in the most 
recent plan year with respect to any Benefit Plan, 
including all schedules thereto and financial 
statements with attached opinions of independent 
accountants.

(b)	Except as disclosed on Schedule 2.15.1 
or as required by Section 4980B of the Code, neither 
the Company nor any Subsidiary has made any promises or 
commitments to provide, and is under no obligation or 
liability to provide, (i) medical benefits (including 
through insurance) generally applicable to U.S. 
retirees or former U.S. employees or their dependents 
or (ii) life insurance or other death benefits 
(including through insurance) generally applicable to 
retired U.S. employees or their dependents.

2.15.2	Compliance with Applicable Law.

(a)	Each Benefit Plan that is intended to be 
qualified under Section 401(a) of the Code has received 
a favorable determination letter from the Internal 
Revenue Service that such Benefit Plan is qualified 
under Section 401(a) of the Code (as amended by the Tax 
Reform Act of 1986 and subsequent legislation prior to 
1994) and that the trust under such Benefit Plan is 
exempt from tax under Section 501(a) of the Code.  To 
the knowledge of Chiron, no event has occurred that is 
likely to give rise to disqualification or loss of tax-
exempt status of any such Benefit Plan under Sections 
401(a) or 501(a) of the Code.  No "prohibited 
transaction" (within the meaning of Section 4975 of 
the Code or Sections 406 and 408 of ERISA) has occurred 
with respect to any of such Benefit Plans that, 
assuming the taxable period of such transaction expired 
as of the date hereof, could subject the Company or any 
of its Subsidiaries to a tax or penalty imposed by 
either Section 4975 of the Code or Section 502(i) of 
ERISA.  Chiron has delivered to the Purchaser the most 
recent determination letter received from the Internal 
Revenue Service with respect to each such Benefit Plan.

(b)	All contributions (including all 
employer contributions and employee salary reduction 
contributions) which are due have been paid to each 
Benefit Plan.

(c)	All Benefit Plans are in substantial 
compliance in form and in operation with the relevant 
provisions of ERISA and the Code, the regulations and 
published authorities thereunder, and all other laws 
applicable with respect to all such Benefit Plans.  The 
Company and its Subsidiaries have performed their 
obligations under all Benefit Arrangements in all 
material respects. There is no action (other than 
routine claims for benefits) pending or to the 
knowledge of Chiron and the Company threatened against 
any Benefit Arrangement or arising out of any Benefit 
Arrangement.

(d)	Except as disclosed in Schedule 2.15.2 
(which shall identify the entity obligated to make any 
payments due or which may become due), the execution 
and performance of this Agreement will not (i) 
constitute a stated triggering event under any Benefit 
Arrangement that will result in any payment (whether of 
severance pay or otherwise) becoming due from Chiron, 
the Company or any Subsidiaries to any present or 
former officer, employee, director or consultant (or 
dependents of any thereof) of the Company or any of its 
Subsidiaries, or (ii) accelerate the time of, or upon 
any act or event, or the lapse of time or both, result 
in any payment or vesting, or increase the amount, of 
compensation due to any employee, officer, director or 
consultant of the Company or any Subsidiaries under any 
Benefit Arrangements.

(e)	To the knowledge of Chiron and the 
Company, except as set forth on Schedule 2.15.2, all 
Benefit Plans and Benefit Arrangements maintained for 
foreign employees are in compliance in all material 
respects in form and in operation with all laws 
applicable to such Benefit Arrangements.

2.16	Certain Interests.  Except as set forth in 
Schedule 2.16, no officer or director of Chiron, the Company 
or any Subsidiary is indebted or otherwise obligated to the 
Company or any Subsidiary; and neither the Company nor any 
Subsidiary is indebted or otherwise obligated to any such 
officer or director, except for amounts due under normal 
arrangements applicable to all employees generally as to 
salary or reimbursement of ordinary business expenses.

2.17	Intercompany Transactions.  Except as described in 
Schedule 2.17, none of the goods and services provided by 
Chiron or any Affiliate of Chiron (other than the Company 
and the Subsidiaries) to the Company or any of its 
Subsidiaries described in Schedule 2.17 is required or 
necessary for the ongoing operation of the Company or any of 
its Subsidiaries.  Except as described in Schedule 2.17, 
neither the Company nor any Subsidiary has any liabilities 
or obligations to Chiron or any other Affiliate of Chiron 
(other than the Company and the Subsidiaries) and none of 
Chiron or such Affiliates has any obligations to the Company 
or any Subsidiary.  Except as described in Schedule 2.17, 
consummation of the transactions contemplated by this 
Agreement will not (either alone, or upon the occurrence of 
any act or event, or with the lapse of time, or both) result 
in any payment arising or becoming due from the Company or 
any Subsidiary or the successor or assign of any thereof to 
Chiron or any Affiliate of Chiron.

2.18	No Brokers or Finders.  No agent, broker, finder, 
or investment or commercial banker (other than Morgan 
Stanley, Dean Witter & Co., as to whose fees and expenses 
Chiron shall have full responsibility and neither the 
Company nor any Subsidiary nor the Purchaser shall have any 
responsibility) or other Person or firm engaged by or acting 
on behalf of Chiron, Company or any Subsidiary or any of 
their respective Affiliates in connection with the 
negotiation, execution or performance of this Agreement or 
the transactions contemplated by this Agreement, is or will 
be entitled to any brokerage or finder's or similar fee or 
other commission as a result of this Agreement or such 
transaction.

2.19	Inventories.  As of the Closing Date, the 
inventory as set forth on the Closing Date Balance Sheet is 
acquired and maintained in accordance with the regular 
business practices of the Company and the Subsidiaries, 
consists of new, unused and reconditioned items of a quality 
and quantity usable or saleable in the ordinary course of 
business, and is valued at reasonable amounts in accordance 
with GAAP and consistent with GAAP and consistent with the 
normal valuation policy of the Company.  As of the Closing 
Date, none of such inventory is obsolete, unusable, damaged 
or unsalable in the ordinary course of business, except for 
such items of inventory which have been written down to 
realizable market value, or for which adequate reserves have 
been provided, in the Closing Date Balance Sheet.

2.20	Receivables.  As of the Closing Date, the accounts 
receivable set forth on the Closing Date Balance Sheet 
represent bona fide claims of the Company or the 
Subsidiaries against customers for sales, services performed 
or other charges arising on or before the date thereof.  As 
of the Closing Date, said accounts receivable are subject to 
no defenses, counterclaims or rights of setoff, except to 
the extent of the appropriate reserves for bad debts on 
accounts receivable as set forth on the Closing Date Balance 
Sheet.

2.21	Insurance.  Attached as Schedule 2.21 is a list of 
(a) all insurance policies and bonds provided by third 
parties currently maintained by or on behalf of the Company 
and its Subsidiaries or which were maintained by or on 
behalf of the Company and its Subsidiaries during the past 
two years and (b) any third party indemnities relating to 
the Company or its Subsidiaries under which Chiron, the 
Company or any Subsidiary is receiving currently any 
payments.  Neither the Company nor any Subsidiary is in 
default under any such policy or bond, nor is Chiron or 
Centaur in default under any such policy or bond, where such 
default would provide any insurer with a defense to its 
obligation to provide coverage or otherwise be likely to 
interfere with such coverage.  Except as disclosed on 
Schedule 2.21, to the knowledge of Chiron, the Company and 
the Subsidiaries, Chiron, Centaur, the Company or the 
Subsidiaries, as the case may be, have timely filed claims 
with, and given notice to, the applicable insurers with 
respect to all written claims for which the Company and its 
Subsidiaries or Chiron or Centaur (where the Company or its 
Subsidiaries would be indirect beneficiaries under such 
policies maintained by Chiron or Centaur consistent with 
past practice) may reasonably be expected to have coverage.  
Except as disclosed on Schedule 2.12, claims have been filed 
with insurers with respect to each matter identified on 
Schedule 2.12 and such claims are covered by the applicable 
insurance policies of such insurers, subject to the 
applicable deductible or self-insured retention amounts 
under the policies of such insurers (excluding Centaur).  
Except as disclosed on Schedule 2.21, the execution, 
delivery and performance of this Agreement will not 
constitute a breach or default of any such policies, bonds 
or third party indemnities which would result in a 
termination of existing coverage for any claims for which 
notice was properly given prior to Closing, or in the case 
of third party indemnities, loss of the right to receive 
coverage following the Closing.

2.22	Chiron Canada.  As of the Closing Date, Chiron 
Canada has no assets related to or connected with the 
business of the Company or any Subsidiary as presently 
conducted.

2.23	Certain FDA Matters.  Except as disclosed in 
Schedule 2.23, there have been no product recalls or market 
withdrawals by the Company or any Subsidiary since December 
31, 1995.

2.24	Completeness.  To the knowledge of Chiron, the 
Company or any Subsidiary, the Schedules to Article II  
attached hereto do not contain any untrue statement of a 
material fact or omit to state any material fact required to 
be stated therein or necessary in order to make the 
statements therein, in light of the circumstances under 
which they were made, not misleading.


	ARTICLE III

	Representations and Warranties of the Purchaser

The Purchaser hereby represents and warrants to Chiron 
that:

3.1	Organization and Authority.  The Purchaser is a 
corporation duly organized, validly existing and in good 
standing under the laws of the State of New York.  The 
Purchaser has full power and authority to execute, deliver 
and perform this Agreement.  The execution, delivery and 
performance of this Agreement by the Purchaser and the 
consummation of the transactions contemplated hereby have 
been duly authorized by all necessary corporate action on 
the part of the Purchaser.  This Agreement constitutes a 
valid and, assuming due execution by Chiron, and the 
expiration or termination of the applicable waiting period 
under the HSR Act, binding obligation of the Purchaser, 
enforceable against the Purchaser in accordance with its 
terms, subject to applicable bankruptcy, insolvency, 
moratorium, reorganization or similar laws affecting 
creditors' rights generally and to general equitable 
principles.

3.2	Noncontravention.  The execution, delivery and 
performance of this Agreement by the Purchaser and the 
consummation of the transactions contemplated hereby will 
not violate or conflict with, or constitute a breach or 
default (whether upon lapse of time and/or the occurrence of 
any act or event or otherwise) under (a) the certificate of 
incorporation or bylaws of the Purchaser, (b) any law, 
regulation, order, judgment, or decree applicable to the 
Purchaser or (c) any contract, indenture, mortgage or other 
instrument to which the Purchaser is a party that is 
material to the financial condition or results of operations 
of the Purchaser; subject (as to clauses (b) and (c) 
respectively) to the matters disclosed on Schedule 3.2.

3.3	No Governmental Consent or Approval Required.  No 
authorization, consent, approval or other order of, 
declaration to, or registration, qualification, designation 
or filing with, any governmental entity or body or any other 
Person is required for or in connection with the execution, 
delivery and performance of this Agreement by the Purchaser 
and the consummation of the transactions contemplated 
hereby, other than (a) the filing of notification under the 
HSR Act and the expiration or early termination of the 
waiting period thereunder as well as certain filings under 
Competition Laws and (b) the matters identified in Schedule 
3.3 as requiring that certain actions to be taken by or with 
respect to any governmental entity or body or any other 
Person.

3.4	Purchase for Investment.  The Purchaser is 
purchasing the Stock for investment for its own account and 
not with a view to, or for sale in connection with, the 
distribution thereof.


	ARTICLE IV

	Covenants of Chiron

4.1	Cooperation and Access.  From and after the date 
hereof, Chiron shall cause the Company and each Subsidiary 
to afford promptly to employees of the Purchaser with 
responsibility for a particular subject area or subject 
matter, to the Purchaser's management personnel and to its 
authorized representatives (which term shall include its 
independent accountants and counsel) at all reasonable times 
with reasonable prior notice full and unrestricted access to 
the premises, facilities, properties, books, records, 
lawsuit pleadings, work papers and personnel of the Company 
and each Subsidiary, to furnish to the Purchaser copies of 
such books, records, working papers and such other 
additional financial, tax, legal, and operating data and 
information as the Purchaser may reasonably request and to 
permit the Purchaser and its authorized representatives to 
discuss the business and operations of the Company and its 
Subsidiaries with the officers, employees with 
responsibility for a particular subject area or subject 
matter, accountants and counsel of the Company and its 
Subsidiaries in order to assist the Purchaser in its 
evaluation of the business; provided, however, that the 
Purchaser shall not interfere with the normal operation of 
the business of the Company and its Subsidiaries and Chiron 
shall have the right to participate in all discussions with 
the accountants and counsel of the Company and its 
Subsidiaries. To the extent Chiron incurs more than $50,000 
in the aggregate of fees and expenses to its outside 
accountants and counsel who participate in such discussions 
with the Purchaser or its representatives, the Purchaser 
will reimburse Chiron for the amount of such fees and 
expenses that exceed $50,000, against receipt of invoices of 
such accountants and counsel.

4.2	Conduct of Business.

4.2.1	Pre-Closing Negative Covenants.  From 
the date hereof until the Closing, without the prior written 
consent of the Purchaser, which shall not be unreasonably 
withheld, Chiron will not permit the Company or any 
Subsidiary to:

(a)	enter into, amend in any material 
respect or terminate any Material Contract except in 
the ordinary course of business consistent with past 
practice;

(b)	issue or transfer any capital stock of 
the Company or any Subsidiary or any security 
convertible into or exchangeable for any such capital 
stock or any right to acquire any such capital stock, 
except as expressly provided in Section 2.4;

(c)	merge or consolidate with any entity 
except as provided in Section 2.4 or acquire any stock 
or other ownership interests in any entity or the 
assets of any business substantially as an entirety, 
except as disclosed in Schedule 4.2.1;

(d)	make any change in its certificate of 
incorporation or bylaws (or equivalent governing 
instruments);

(e)	sell, lease, pledge, encumber or 
otherwise dispose of or transfer any of its assets or 
property, except in the ordinary course of business 
consistent with past practice;

(f)	incur any third party indebtedness other 
than ordinary course trade debt consistent with past 
practice or, except as set forth on Schedule 4.2.1, 
enter into any commitment or make any capital 
expenditures or investments of more than $200,000 alone 
or $1,000,000 in the aggregate other than as set forth 
in the 1997 capital budget of the Company or as 
required by existing contractual obligations;

(g)	liquidate, dissolve or otherwise 
reorganize or seek protection from creditors, except as 
disclosed in Schedule 4.2.1;

(h)	except in the ordinary course of 
business, settle any claim, dispute or litigation in 
consideration for anything other than payment of 
monies;

(i)	conduct their respective business other 
than in the ordinary course, consistent with past 
practice;

(j)	terminate or fail to renew any insurance 
coverage;

(k)	grant any general or uniform increase in 
the pay or benefits of employees, or any increase in 
the pay, bonus or benefits of any individual employee 
earning $50,000 or more in annual salary (including 
bonus) other than in the ordinary course of business as 
disclosed in Schedule 4.2.1 or as otherwise disclosed 
on Schedule 4.2.1;

(l)	enter into any employment contract that 
is not terminable at will and without payment (other 
than the payment of customary severance in accordance 
with the Company's policies); or

(m)	agree or commit itself to do any of the 
foregoing.

4.2.2	Pre-Closing Affirmative.  Prior to the 
Closing, Chiron shall, and shall cause the Company and each 
Subsidiary to, use commercially reasonable efforts to 
preserve intact its business and the goodwill of its 
customers, suppliers, employees, and others having business 
relations with it.

4.3	Government Approvals.  Chiron will, and will cause 
the Company and the Subsidiaries, to prepare and file, at 
the earliest practicable date, all applications and other 
notices required in connection with, and will use its 
commercially reasonable effort to obtain promptly , all 
consents, approvals or other actions by any governmental 
agency or authority required to be obtained by Chiron, the 
Company or any Subsidiary in connection with the performance 
of this Agreement and the consummation of the transactions 
contemplated hereby, including, without limitation, promptly 
prepare and file notification in accordance with the HSR Act 
and other Competition Laws.  Chiron will notify the 
Purchaser of all requests, terms or conditions made or 
sought to be imposed on the Company or any Subsidiary in 
connection with obtaining such approvals and will discuss 
with the Purchaser the acceptability of such requests, and 
Chiron and the Purchaser will mutually agree on the response 
to such requests.

4.4	Consents.  Chiron will cause the Company and its 
Subsidiaries to use commercially reasonable efforts to 
obtain, at the earliest practicable date, the Contract 
Approvals.

4.5	Material Developments, Reports, Etc.

4.5.1	Events or Occurrences.  Chiron shall 
promptly notify the Purchaser of any event which, to the 
knowledge of Chiron, the Company or any of the Subsidiaries, 
has had or might reasonably be expected to have a material 
adverse effect on the assets, properties, condition 
(financial or otherwise), results of operations or the 
business of the Company or any of its Subsidiaries taken as 
a whole.

4.5.2	Reports.  Chiron shall deliver to the 
Purchaser promptly after they become  available the 
operating and financial reports to the extent customarily 
prepared (including projections and budgets) of the Company 
and its Subsidiaries that are prepared for management of the 
Company or Chiron and monthly and quarterly unaudited 
balance sheets, statements of operation for the Company and 
its consolidated Subsidiaries.

4.6	Intercompany Accounts.  Prior to the Closing, 
Chiron shall (a) cause to be eliminated any and all loans, 
advances and other extensions of credit made between the 
Company or any Subsidiary on the one hand, and Chiron and 
any of its Affiliates (other than the Company or any 
Subsidiary), and (b) cause to be transferred to it all cash 
and cash equivalents of the Company and the Subsidiaries.

4.7	Claremont Property.  On or before the Closing, the 
Claremont Property will be transferred to Chiron by 
quitclaim deed with no representations and warranties by the 
Company.  Following the Closing and until the third 
anniversary date of the Closing, the Purchaser and the 
Company shall have the right to occupy and use the currently 
occupied portion of the Claremont Property exclusively and 
on a rent-free basis, whether or not the Claremont Property 
is sold to a third party. 

4.8	Assignment of Leases.  On or before the Closing, 
at Chiron's option, the Huntington Lease and the Milton 
Keynes Lease, together with all obligations of the Company 
thereunder as lessee, will be assigned to Chiron pursuant to 
the terms of an assignment and assumption agreement 
reasonably acceptable as to form by the Purchaser or Chiron 
will indemnify the Purchaser from such obligations.

4.9	No Solicitation.  Chiron agrees that it will not, 
nor will it permit the Company or its Subsidiaries to, nor 
will it authorize any stockholder, officer, director, 
employee of, or any investment banker, attorney or other 
advisor or representative of, Chiron, the Company or its 
Subsidiaries to, solicit or initiate or encourage the 
submission of any proposal to acquire the Company or its 
business; provided that nothing herein shall preclude 
Chiron, the Company or its Subsidiaries from continuing 
discussions and exchange of information with potential 
purchasers who have indicated an interest prior to the date 
hereof.

4.10	Payroll and Other Services.  Following the 
Closing, Chiron shall provide the Purchaser, for the benefit 
of the Company, with such employee payroll, other employee-
related processing services, human resource and computer 
services and laser servicing in Canada as were provided to 
the Company prior to the Closing, but only as are reasonably 
required by the Purchaser during the period that the 
Purchaser is diligently pursuing the transition of the 
employees of the Company over to its own services up to a 
maximum of six months.  Such services shall be provided at a 
rate equal to Chiron's fully burdened cost plus 10%.  At or 
prior to the Closing, (a) Chiron and the Company will enter 
into a co-promotion agreement in form and substance 
reasonably satisfactory to the Purchaser to promote 
Vitrasert through Chiron's Therapeutics Group for a period 
of three years on reasonable terms and conditions, and (b) 
Chiron shall cause Chiron B.V. to enter into an agreement in 
form and substance reasonably satisfactory to the Purchaser 
with the Company on reasonable terms and conditions under 
which Chiron B.V. will, for a period of two years, provide 
Vitrasert testing services ("Vitrasert Testing") to the 
Company.  The Purchaser shall agree to indemnify, defend and 
hold harmless Chiron and its Affiliates from and against any 
and all Losses arising out of or attributable to the 
provision of all services provided under Section 4.10, other 
than the co-promotion of Vitrasert.  Chiron shall agree to 
indemnify, defend and hold harmless the Purchaser, the 
Company and their Affiliates from and against any and all 
Losses arising out of or attributable to the negligence of 
Chiron B.V. in connection with Vitrasert Testing.

4.11	Employee Provisions.  Prior to the Closing, Chiron 
shall exercise commercially reasonable efforts to enter into 
an employment agreement with William Link on terms 
acceptable to the Purchaser.

4.12	Use of Chiron Name.  Following the Closing, the 
Company and its Subsidiaries shall have the right to 
continue to use the tradename of Chiron, any derivation 
thereof or the Centaur design ("Chiron Name") which is 
affixed to products, labeling, packaging materials or 
promotional materials as of the Closing Date until the later 
of (a) depletion of existing inventories, or (b) the date on 
which any requisite regulatory approvals are obtained in 
connection with the removal of the Chiron Name from the 
foregoing; provided that such use shall in no event continue 
longer than two years following the Closing.  The Purchaser 
will use its commercially reasonable efforts to secure any 
such requisite regulatory approvals as promptly as 
practicable following the Closing Date.  Prior to the 
Closing, the parties will enter into a trademark license 
agreement in a form reasonably acceptable to Chiron and the 
Purchaser governing such use of the Chiron name after the 
Closing.

4.13	Insurance Coverage.  Prior to the Closing, Chiron 
shall take such action as may be required to ensure that any 
insurance coverage for any claims that have been filed with 
the applicable insurers prior to the Closing relating to the 
Company and its Subsidiaries will continue with respect to 
such claims following the Closing, and Chiron agrees to pay 
to the Company insurance proceeds (net of any out-of-pocket 
unreimbursed costs or expenses of Chiron incurred in defense 
of such claim) resulting from such coverage promptly after 
receipt thereof.  From and after the date hereof, Chiron 
shall diligently pursue insurance coverage for any claims 
filed with Centaur and/or third party insurers prior to the 
Closing relating to the Company and its Subsidiaries. 
Following the Closing, Chiron shall be responsible for the 
control of all claims filed with Centaur and the Company 
shall be responsible for the control of all claims filed 
with third party insurers, subject to the control exercised 
by any insurers in accordance with the applicable insurance 
policies.  Following the Closing, Chiron shall transfer, 
immediately, to the Company, all proceeds (net of 
unreimbursed defense costs incurred by Chiron) to which it 
is entitled to receive from Centaur and/or third party 
insurers, as the case may be, as a result of such claims.

4.14	Human Resource Data Base.  At the Purchaser's 
request, following the Closing, Chiron shall provide the 
Purchaser and the Company with reports containing the 
information in Chiron's Human Resource Information System 
relating to the domestic employees of the Company.

4.15	Alternative Deal Structures.  From and after the 
date hereof, the Purchaser and Chiron shall exercise 
commercially reasonable efforts to evaluate, identify and 
agree upon alternative means of structuring the transactions 
contemplated hereby ("Alternative Deal Structures"), 
including without limitation, asset transfers between 
Subsidiaries of the Company and Affiliates of the Purchaser 
for the purpose of providing to the Purchaser tax benefits 
following Closing having a present value equal to no less 
than $2 million (including the benefits to the Purchaser of 
any Net Operating Losses of Chiron Adatomed at the Closing 
plus any adjustment to the Purchase Price made pursuant to 
Section 1.5.1(c)); provided that such structures impose no 
additional cost on Chiron, the Company or the Subsidiaries.

4.16	Retention Bonus Payments.  Chiron shall promptly 
pay when due all payments to employees of the Company and 
its Subsidiaries under the Chiron Retention Plan, Chiron 
Transaction Team Program and the Executive Amendment to the 
Company's Global Severance Program described in Schedule 
4.16; provided that in the case of the Executive Amendment 
to the Company's Global Severance Program, Chiron's 
responsibility shall be limited to the amount by which the 
payments required under such Executive Amendment exceed the 
amounts that would have been required had the Company's 
Global Severance Program not been so amended.

4.17	Confidentiality. Chiron, the Company and its 
Subsidiaries, at all times prior to the Closing and after 
any termination of this Agreement, will hold all 
confidential information provided to Chiron by or on behalf 
of the Purchaser in confidence and will not disclose such 
information prior to Closing other than to directors, 
officers, employees, and agents of Chiron who need to know 
such information for the purposes of the transactions 
contemplated by this Agreement.  Upon any termination of 
this Agreement, Chiron will promptly return to the Purchaser 
such information provided to Chiron, including any copies of 
such information; provided that Chiron may retain one copy 
in its Law Department. Chiron acknowledges that the 
Purchaser would be irreparably harmed by a breach of this 
Section 4.17 and that there would be no adequate remedy at 
law or in damages to compensate the Purchaser for any such 
breach and agrees that, in addition to any other remedy, the 
Purchaser shall be entitled to one or more injunctions 
requiring specific performance by Chiron, the Company or its 
Subsidiaries of this Section 4.17, and Chiron, the Company 
and its Subsidiaries consent to the entry thereof.

4.18	Product Liability Claims.  From and after the date 
hereof, Chiron shall use commercially  reasonable efforts to 
pursue any claims for indemnification under agreements 
identified on Schedule 4.18 arising out of any product 
liability claims against the Company or any Subsidiary filed 
prior to the Closing, and Chiron agrees to pay to the 
Company all indemnification proceeds (net of any out-of-
pocket costs or expenses incurred by it in pursuing such 
claims) resulting from such indemnification claims promptly 
after receipt thereof; provided that notwithstanding the 
foregoing, Chiron shall have no obligation to continue to 
pursue such indemnification in the event it reasonably 
determines that such pursuit would require it to institute 
legal proceedings or is not likely to result in recovery; 
further provided, however, that at the time of any such 
determination, upon the Purchaser's request and at the 
Purchaser's expense, Chiron shall pursue such third party 
indemnification on the Purchaser's behalf.


	ARTICLE V

	Covenants of the Purchaser

5.1	Government Approvals.  The Purchaser will prepare 
and file, at the earliest practicable date, all applications 
and other notices required in connection with, and will use 
its commercially reasonable efforts to obtain promptly, all 
consents, approvals or other actions by any governmental 
agency or authority required to be obtained by the Purchaser 
in connection with the performance of this Agreement and the 
consummation of the transactions contemplated hereby, 
including, without limitation, promptly prepare and file 
notification in accordance with the HSR Act and other 
Competition Laws.  The Purchaser will notify Chiron of all 
requests, terms or conditions made or sought to be imposed 
on the Purchaser in connection with obtaining such approvals 
and will discuss with Chiron the acceptability of such 
requests, and the Purchaser and Chiron will mutually agree 
on the response to such requests.

5.2	Confidentiality.  The Purchaser, at all times 
prior to the Closing and after any termination of this 
Agreement, will hold all confidential information provided 
to the Purchaser by or on behalf of Chiron, the Company or 
any Subsidiary in confidence and will not disclose such 
information prior to Closing other than to directors, 
officers, employees and agents of the Purchaser who need to 
know such information for the purposes of the transaction 
contemplated by this Agreement.  Upon any termination of 
this Agreement, the Purchaser will promptly return to Chiron 
all such information provided to the Purchaser, including 
any copies of such information, provided that the Purchaser 
may retain one copy in its Law Department.  The Purchaser 
acknowledges that Chiron would be irreparably harmed by a 
breach of this Section 5.2 and that there would be no 
adequate remedy at law or in damages to compensate Chiron 
for any such breach and agrees that, in addition to any 
other remedy, Chiron shall be entitled to one or more 
injunctions requiring specific performance by the Purchaser 
of this Section 5.2, and the Purchaser consents to the entry 
thereof.

5.3	Employee Benefits.  From and after the Closing 
Date, the Purchaser shall provide the employees of the 
Company and its Subsidiaries with employee benefit plans, 
programs, policies or arrangements which are no less 
favorable in the aggregate than the benefit plans, programs, 
policies and arrangements provided by Chiron, the Company 
and its Subsidiaries to employees of the Company and its 
Subsidiaries prior to the Closing.  In addition, the 
Purchaser shall provide to employees of the Company and its 
Subsidiaries benefit plans, programs, policies or 
arrangements that in the aggregate will be approximately 
comparable to the benefit plans, programs, policies or 
arrangements provided by the Purchaser to its other 
employees with similar levels of responsibility; provided 
that new or additional benefits may in no event be provided 
later than one year following the Closing and nothing shall 
require the Purchaser to provide any particular benefit 
plan, program, policy or arrangement not currently provided 
by the Purchaser to its employees.  To the extent any such 
benefit plans, programs, policies or arrangements are not 
currently provided by the Purchaser to its employees, the 
Purchaser will provide replacement benefits that in the 
aggregate are approximately comparable.  Each such employee 
benefit plan, program, policy or arrangement shall give full 
credit for each participant's period of service with the 
Company and its Subsidiaries prior to the Closing Date for 
purposes of determining eligibility, vesting and the amount 
of benefits (including subsidies relating to such benefits), 
other than for the defined benefit plans. Each employee 
welfare benefit plan provided by the Purchaser to the 
employees of the Company and its Subsidiaries shall give 
full credit for deductibles satisfied under the Company's 
and its Subsidiaries' Benefit Plans with respect to the 
current plan year toward any deductibles for the remainder 
of the plan year during which the Closing occurs, and shall 
waive any pre-existing condition limitation for any employee 
covered under a Company or Subsidiary Benefit Plan (which is 
a group health plan) immediately prior to the Closing Date.  
Nothing contained in this Section 5.3 will create any third 
party beneficiary rights in any employee or former employee 
of the Company or any Subsidiaries in respect of continued 
employment or any other matters including, but not limited 
to, any rights in any benefit plan, program, policy or 
arrangement provided by the Purchaser.

5.4	Warn Ac.  The Purchaser shall comply with The 
Worker Adjustment Retraining Notification Act (the "Warn 
Act") and shall indemnify Chiron against liability 
thereunder.


	ARTICLE VI

	Tax Matters

6.1	Definitions.  For purposes of this Agreement, 
"Taxes" shall mean all federal, state, local and foreign 
income, property, sales and use, excise, withholding, 
franchise, real and personal property, transfer, gross 
receipt, capital stock, production, business and occupation, 
disability, employment, payroll, severance and other taxes, 
tariffs or government charges of any nature whatsoever, and 
shall include any penalties or interest relating thereto, 
and any Loss in connection with the determination, 
settlement or litigation of any Tax liability; and "Net 
Operating Losses" or "NOLs" shall mean the deduction 
allowed as a carryforward for losses incurred in a prior 
taxable period.

6.2	Tax Sharing Agreements; Tax and Other Returns and 
Reports.

6.2.1	Tax Sharing Agreements.  Chiron 
represents and warrants to the Purchaser that, except as set 
forth in Schedule 6.2.1, neither the Company nor any 
Subsidiary is a party to any agreement, contract or 
understanding relating to any sharing by the Company or any 
Subsidiary of any Tax liability of any person or entity.

6.2.2	Tax and Other Returns and Reports.  
Chiron represents and warrants to the Purchaser that, except 
as set forth in Schedule 6.2.2, the Company and each 
Subsidiary have timely filed or will file (or, where 
permitted or required, its respective direct or indirect 
parents have timely filed or will file) all required Tax 
Returns and have paid all Taxes due for all periods ending 
on or before the Closing Date.  Except as disclosed in 
Schedule 6.2.2, adequate provision has been made in the 
books and records of the Company and each Subsidiary, and in 
the Financial Statements referred to in Section 2.7 above or 
in any other financial statements delivered or to be 
delivered to the Purchaser, for all Taxes whether or not due 
and payable and whether or not disputed.  Neither the 
Company nor any Subsidiary has elected to be treated as a 
consenting corporation under Section 341(f) of the Code.  
Schedule 6.2.2 lists the date or dates through which the IRS 
and any other governmental entity or body have examined the 
United States federal income tax returns and any other Tax 
Returns of the Company and its Subsidiaries.  All required 
Tax Returns, including amendments to date, have been 
prepared in good faith without negligence or willful 
misrepresentation and are complete and accurate in all 
material respects.  Except as set forth in the Schedule 
6.2.2, no governmental entity or body has, during the past 
three years, examined or is in the process of examining any 
Tax Returns of the Company or any Subsidiary.  Except as set 
forth on Schedule 6.2.2, no governmental entity or body has 
proposed (tentatively or definitively), asserted or assessed 
or, to the knowledge of Chiron, threatened to propose or 
assert, any deficiency, assessment or claim for Taxes and 
there would be no basis for any such deficiency assessment 
or claim.  Chiron has provided to the Purchaser all Tax 
Returns filed for the Company on a separate basis (and 
related work papers, audit papers or other relevant 
documents for Tax Returns) and excerpts from consolidated 
and combined returns relating to tax items of the Company, 
included therein for the prior three years and for all prior 
periods that are still open under the statute of limitations 
which have been requested by the Purchaser or its duly 
authorized representatives.

6.3	Pre-Closing Tax Indemnity.  Chiron shall 
indemnify, defend and hold harmless the Purchaser and its 
Affiliates (including the Company and each Subsidiary) and 
their respective directors, officers, employees and agents 
from any Taxes imposed on the Company or any of its 
Subsidiaries with respect to any taxable period, or portion 
thereof, ending on or prior to the Closing Date (including 
without limitation any such Taxes from, or Taxes related to 
other transactions which are payable because of, 
transactions or elections contemplated by this Agreement), 
except to the extent of the aggregate amount of Taxes 
reflected on the Closing Date Balance Sheet.  Chiron shall 
further indemnify, defend and hold harmless the Purchaser 
and its Affiliates (including without limitation the Company 
and each Subsidiary) and their respective directors, 
officers, employees and agents against (a) Taxes for any 
period whatsoever of any member of a consolidated or 
combined tax group of which Chiron or any of its Affiliates 
is, or was at any time, a member, for which the Company 
and/or any Subsidiary is liable as a result of its inclusion 
in such group, (b) any claim or demand for reimbursement or 
indemnification resulting from any transfer by Chiron prior 
to the Closing of any Tax benefits or credits to any other 
Person, and (c) any Tax liabilities arising out of the 
transfer of the Stock pursuant to this Agreement or the 
transfer of the stock of Chiron Adatomed as contemplated 
hereby.  This Section 6.3 shall not apply to any increase in 
tax resulting from any reassessment of real or personal 
property taxes as a result of the transfer of stock of the 
Company to the Purchaser, or with respect to any increase in 
tax resulting from changes in the valuation of any asset or 
liability of the Company due to the election contemplated 
under Section 6.9.

6.4	De Minimis Taxes.  Chiron shall not be liable 
under Section 6.3 for any amount assessed for any particular 
Tax or Tax period of less than $5,000.

6.5	Tax Periods.  With respect to any Taxes for any 
taxable period that includes but does not end as of the 
Closing Date, the amount of Taxes subject to indemnification 
hereunder shall be calculated as if such taxable period 
ended as of the close of business on the Closing Date, 
except that property Taxes calculated on an annual basis 
shall be prorated based on the number of days in the annual 
period elapsed through the Closing Date compared to the 
number of days in the annual period elapsing after the 
Closing Date.

6.6	Offset for Future Reductions.  To the extent an 
increase in Tax for any period which gives rise to a 
liability of Chiron under Section 6.3 is the result of an 
adjustment which will result in a corresponding decrease in 
Tax for a subsequent period, Chiron shall be liable for the 
full amount of such increase for such period and the 
Purchaser shall pay Chiron the amount of such corresponding 
decrease in Tax for such subsequent period (if any) when 
such corresponding decrease in Tax is actually realized by 
the Company in such subsequent period.  Chiron promptly 
shall indemnify and reimburse the Purchaser for any Loss if 
such decrease in Tax, as claimed on a Tax Return or any 
other document, is subsequently successfully contested by 
the applicable taxing authority.

6.7	Net Operating Losses.  The indemnity in Section 
6.3 shall not apply to, and Chiron shall not be liable for, 
any increase in Tax resulting from any adjustment to any Net 
Operating Loss of the Company or its Subsidiaries available 
to offset income of the Company or the Purchaser in a Tax 
period beginning on or after the Closing Date.  
Additionally, Chiron makes no representation with respect to 
the ability of the Company or its Subsidiaries to use after 
the Closing Date any Net Operating Loss available 
immediately prior to the Closing Date, and Chiron shall not 
have any indemnity obligation hereunder to the extent that 
the Company, its Subsidiaries or the Purchaser are unable to 
use after the Closing Date NOLs available immediately prior 
to the Closing Date.

6.8	Tax Proceedings.

6.8.1.	Right to Control Proceedings.  Chiron 
shall have the responsibility for, and the right to control, 
at Chiron's expense, the audit (and disposition thereof) of 
any Tax Return relating to periods ending on or prior to the 
Closing Date and to participate in the disposition of the 
audit of any Tax Return relating to the periods ending after 
the Closing Date if such audit or disposition thereof could 
give rise to a claim for indemnification hereunder (any such 
audit or disposition, a "Tax Proceeding").

6.8.2.	Notice; Reports.  Chiron's right to 
control a Tax Proceeding shall commence upon the receipt by 
the Purchaser or any of its Affiliates (including, after the 
Closing Date, the Company and its Subsidiaries) of a 
proposed adjustment to Tax for the period under audit or 
examination communicated in writing.  The Purchaser shall 
promptly notify Chiron in writing upon their learning of the 
pendency of a Tax Proceeding and shall fully cooperate with 
Chiron in the conduct of such Tax Proceeding.  The Purchaser 
shall provide to Chiron, once per year, a list of any Tax 
audits, examinations or other proceeding that is or could 
result in a Tax Proceeding in progress, the nature of the 
Tax and Tax period involved and the status of the 
proceeding, including the amount of the proposed adjustment, 
if known.  The failure on the part of the Purchaser to 
promptly notify Chiron of the pendency of a Tax Proceeding 
or the failure of the Purchaser to provide the information 
set forth in the immediately preceding sentence shall not in 
any way discharge Chiron's indemnity obligations hereunder, 
except that the Purchaser shall be liable for any increase 
in penalties, interest, other assessments or fees and 
expenses which are due to any delay in promptly notifying 
Chiron of the pendency of any Tax Proceeding and shall be 
responsible for any indemnity obligations to the extent that 
Chiron is materially prejudiced as a result of such delay.  
Without the prior written consent of Chiron (which consent 
shall not be unreasonable withheld), neither the Purchaser 
nor any of its Affiliates shall settle or compromise any 
claim for Taxes that might result in Chiron's being required 
to make an indemnity payment pursuant to Section 6.3.  The 
Purchaser shall, and shall cause Company and Subsidiaries 
to, cooperate with Chiron including providing reasonable 
access to records, returns and supporting information, in 
connection with any Tax Proceeding or matter as to which the 
Purchaser may seek indemnity or other relief for Chiron 
under this Article 6.  The Purchaser promptly shall pay 
Chiron any refunds, rebates or other recoveries received by 
the Company or a Subsidiary on account of Taxes paid before 
the Closing.  The Purchaser shall have the right directly or 
through its designated representatives, to review in advance 
and comment upon all submissions made in the course of 
audits or appeals thereof to any governmental entity or body 
relating to periods ending or treated by this Agreement as 
ending on or prior to the Closing Date and to approve the 
disposition of any audit adjustment with respect to such 
periods if such disposition will or might reasonably be 
expected to result in an increase in Taxes, of $50,000 or 
more, of the Purchaser, the Company and/or any Subsidiary 
for any period beginning at or after the Closing or as to 
which the Company and/or any Subsidiary is jointly or 
severally liable as a result of its inclusion in such group 
prior to the Closing Date.  Chiron will not, and will not 
permit any of its Affiliates to, without the consent of the 
Purchaser (which consent shall not be unreasonably 
withheld), make any elections with respect to Taxes that are 
inconsistent with prior elections reflected in prior Tax 
Returns or the Audited Financial Statements.  Chiron will 
not amend, or permit any of its Affiliates to amend, any Tax 
Return for any period prior to or including the Closing Date 
in a manner that would have an adverse effect on the 
Company, any Subsidiary or the Purchaser or its Affiliates, 
or subject them to any liability for Taxes, except for 
amended returns necessary to correct any accounting or 
computational error discovered subsequent to the Closing 
Date or to make adjustments with respect to any item the 
treatment of which is clear under applicable tax laws, 
regulations or rulings.  Chiron shall provide to the 
Purchaser a copy of any amended return prepared thirty days 
prior to the filing of such return.

6.9	Section 338(h)(10) Election.  The Purchaser and 
Chiron agree to join in the making of an election pursuant 
to Section 338(h)(10) of the Internal Revenue Code of 1986, 
as amended, for federal income tax purposes, but not for 
California state tax purposes.  The Purchaser shall prepare 
an allocation schedule (the "Allocation Schedule") 
allocating the Purchase Price and the liabilities of the 
Company and its Subsidiaries among the assets of the Company 
and its Subsidiaries in accordance with Section 1060 of the 
Code and the regulations issued thereunder, and shall submit 
such Allocation Schedule to Chiron for its review and 
signature not later than 30 days prior to the filing date.  
Chiron hereby agrees that so long as the Allocation Schedule 
has been prepared in accordance with Section 1060 of the 
Code and the regulations issued thereunder, it will file all 
tax returns and reports in a manner consistent with the 
Allocation Schedule and will not take any position for 
purposes of any Taxes respecting the allocation of the 
Purchase Price and the liabilities of the Company and its 
Subsidiaries which is inconsistent with the Allocation 
Schedule.

6.10	Survival, Etc.  Notwithstanding anything to the 
contrary contained in this Agreement, the representations 
and warranties and the indemnification obligations set forth 
in this Article VI shall survive the Closing and shall 
remain in effect until the expiration of the applicable 
statute of limitations.  Any matter as to which a claim has 
been asserted by notice to the other party that is pending 
or unresolved at the end of any applicable limitation period 
shall continue to be covered by this Article VI 
notwithstanding any applicable statute of limitations (which 
the parties hereby waive) until such matter is finally 
terminated or otherwise resolved by the parties or by a 
court of competent jurisdiction and any amounts payable 
hereunder are finally determined and paid.  This Article VI 
shall not be deemed to preclude or otherwise limit in any 
way the exercise of any other rights or pursuit of other 
remedies for the breach of this Agreement or with respect to 
any misrepresentation.  Chiron agrees to notify the 
Purchaser of any liabilities, claims or misrepresentations, 
breaches or other matters covered by this Article VI upon 
discovery or receipt of notice thereof (other than from the 
Purchaser), whether before or after the Closing.


	ARTICLE VII

	Conditions to Closing

7.1	General Conditions. Unless waived in writing by 
all parties, the obligations of the parties to proceed with 
the Closing are subject to the satisfaction of the 
conditions that no law, rule, regulation, decree, 
injunction, judgment, order, ruling or writ shall have been 
enacted, entered, issued, promulgated or enforced by any 
governmental entity or body, nor shall any action, petition, 
investigation, suit or other proceeding have been instituted 
and remain pending or, to the knowledge of Chiron or the 
Purchaser, have been threatened and remain so by any 
governmental entity or body at what would otherwise be the 
Closing Date, which prohibits the transactions contemplated 
by this Agreement.

7.2	Conditions to the Obligations of the Purchaser.  
The obligations of the Purchaser to proceed with the Closing 
are subject to the satisfaction at or prior to the Closing 
of all of the conditions set forth in Section 7.1 and this 
Section 7.2, any one or more of which conditions set forth 
in this Section 7.2 may be waived, in whole or in part, by 
the Purchaser:

7.2.1	Accuracy of Representations.  The 
representations and warranties of Chiron in this Agreement 
shall be true and correct at and as of the date of the 
Closing as if made at and as of the Closing, except where 
the failure of the representations and warranties to be true 
and correct would not reasonably be expected to have a 
material adverse affect on the assets, properties, condition 
(financial or otherwise), results of operations, or the 
business of the Company and its Subsidiaries taken as a 
whole, and the Purchaser shall have received (i) a 
certificate, dated the Closing Date, of the Chief Financial 
Officer or the Chief Executive Officer of Chiron to that 
effect, (ii) a certificate, dated the Closing Date of the 
Vice President of Regulatory Affairs to that effect with 
sole and specific reference to Section 2.14 as it relates to 
Regulatory Laws and (iii) certificates, dated the Closing 
Date, of such officers or other employees of the Company 
with responsibility for the particular subject areas or 
subject matters covered in Article II to that effect with 
respect to such particular subject areas or subject matters.

7.2.2	Performance of Covenants.  Chiron shall 
have performed and complied in all material respects with 
all covenants and agreements contained in this Agreement 
that are required to be performed or complied with by it at 
or prior to the Closing, and the Purchaser shall have 
received a certificate, dated the Closing Date, of the Chief 
Financial Officer or the Chief Executive Officer of Chiron 
to that effect.

7.2.3	HSR Act.  The filing of the required 
notification under the HSR Act and other Competition Laws 
required to be filed prior to the Closing and the approval, 
if applicable, or expiration or early termination of the 
applicable waiting period, if any, without there being any 
continuing objection thereto.

7.2.4	Stock Certificate.  Chiron shall have 
delivered to the Purchaser a certificate for the Stock, duly 
endorsed (or accompanied by stock powers duly endorsed) in 
blank.

7.2.5	Opinion of Chiron Counsel.  The 
Purchaser shall have received from William G. Green, Esq., 
Senior Vice President and General Counsel of Chiron, a legal 
opinion in substantially the form attached as Exhibit B.

7.2.6	Consents.  Chiron shall have obtained 
and provided to the Purchaser all required authorizations, 
approvals, consent and Permits listed on Schedule 2.3 and 
shall have made all registrations and filings listed on 
Schedule 2.3 and the Purchaser shall have obtained all 
authorizations, approvals, consents and Permits listed on 
Schedule 3.3 without any materially adverse conditions or 
terms thereto, each in form and substance reasonably 
satisfactory to the Purchaser.

7.2.7	Reserved.

7.2.8	Chiron Adatomed.  Chiron shall have 
transferred all of the capital stock of Chiron Adatomed to 
the Company.

7.2.9	Chiron Canada.  On or prior to the 
Closing Date, the Company shall have transferred all of the 
capital stock of Chiron Canada to Chiron in a transaction 
the form and substance of which are reasonably satisfactory 
to the Purchaser, and all of the assets and liabilities of 
Chiron Canada (other than the Net Operating Losses) will be 
transferred to the Company.

7.2.10	Registration of Directors.  The 
directors of the Company and its Subsidiaries shall have 
submitted their resignations in writing to the Company and 
the Subsidiaries, as applicable.  Such resignations shall be 
effective as of the Closing.  

7.2.11	Non-Competition Agreements.  Chiron 
shall have executed and delivered and shall have caused its 
Affiliates to execute and deliver a non-competition 
agreement substantially in the form attached as Exhibit C 
hereto.

7.2.12	Intercompany Transactions.  Chiron shall 
have delivered to the Purchaser evidence in form and 
substance satisfactory to the Purchaser showing the 
elimination of all of the intercompany indebtedness between 
the Company and its Subsidiaries on the one hand and Chiron 
and its other Affiliates on the other listed on Schedule 
2.17 and the Company shall have transferred all of its cash 
and cash equivalents to Chiron as of the Closing.

7.2.13	Material Adverse Change.  There shall 
not have been any material adverse change in or to the 
assets, properties, condition (financial or otherwise), 
results of operations, or the business of the Company and 
its Subsidiaries taken as a whole between the date hereof 
and the Closing Date, nor shall any events have occurred 
between the date hereof and the Closing Date which would 
reasonably be expected to result in such a material adverse 
change.

7.2.14	Reserved.

7.2.15	Chiron Vision France, S.A.  The 
statutory net equity (as defined by applicable French or 
English law) of Chiron Vision France, S.A. ("CV France") 
and Chiron Vision (UK) shall have been increased to an 
amount which satisfies the minimum statutory net equity 
requirements under such law.

7.2.16	Cash Management.  Any agreements or 
arrangements providing Chiron with the right to remove cash 
from bank accounts of the Company, after the Closing shall 
have been terminated, and the Chief Financial Officer or the 
Chief Executive Officer of Chiron shall have delivered to 
the Purchaser a certificate to that effect.

7.3	Conditions to the Obligations of Chiron.  The 
obligations of Chiron to proceed with the Closing are 
subject to the satisfaction at or prior to the Closing of 
all of the conditions set forth in Section 7.1 and this 
Section 7.3, any one or more of which conditions set forth 
in this Section 7.3 may be waived, in whole or in part, by 
Chiron.

7.3.1	Accuracy of Representations.  The 
representations and warranties of the Purchaser in this 
Agreement shall be true and correct in all material respects 
at and as of the date of the Closing as if made at and as of 
the Closing, and Chiron shall have received a certificate, 
dated the Closing Date, of the Chief Financial Officer of 
the Purchaser to that effect.

7.3.2	Performance of Covenants.  The Purchaser 
shall have performed and complied in all material respects 
with all covenants and agreements contained in this 
Agreement that are required to be performed or complied with 
by it at or prior to the Closing, and Chiron shall have 
received a certificate, dated the Closing Date, of the Chief 
Financial Officer of the Purchaser to that effect.

7.3.3	HSR Act.  The filing of the required 
notice under the HSR Act and other Competition Laws required 
to be filed prior to the Closing and the approval, if 
applicable, or expiration or early termination of the 
applicable waiting period, if any, without there being any 
continuing objection thereto.

7.3.4	Payment.  The Purchaser shall have 
delivered to Chiron by wire transfer to such bank account as 
Chiron shall specify in writing cash in immediately 
available funds in the amount of the Purchase Price, subject 
to the provisions of Section 1.4.

7.3.5	Opinion of Purchaser Counsel.  Chiron 
shall have received from Robert B. Stiles, Senior Vice 
President and General Counsel of the Purchaser, a legal 
opinion in substantially the form attached as Exhibit D.

7.3.6	Claremont Lease.  Chiron and the 
Purchaser shall have entered into an agreement providing for 
the occupancy by the Purchaser of the Claremont Property as 
provided in Section 4.7, payment by the Purchaser of all 
maintenance and operating expenses and indemnification for 
any Losses incurred by Chiron as a result of any acts or 
omissions by the Company or its Subsidiaries in connection 
with their occupancy of the Claremont property following the 
Closing.


ARTICLE VIII

Termination

8.1	Grounds for Termination.  This Agreement may be 
terminated at any time prior to Closing:

8.1.1.	Mutual Agreement.  by the mutual written 
agreement of Chiron and the Purchaser;

8.1.2	Expiration.  by Chiron or by the 
Purchaser if the Closing shall not have occurred on or 
before February 28, 1998, or such other date upon which 
Chiron and the Purchaser may agree in writing; provided, 
however, that February 28, 1998 shall be extended until the 
end of any cure period which commences prior thereto under 
either Section 8.1.7 or Section 8.1.9;

8.1.3	Contravention of Law.  by Chiron or by 
the Purchaser if consummation of the transactions 
contemplated hereby would violate any nonappealable final 
order, decree or judgment of any court or governmental body 
having competent jurisdiction;

8.1.4	Fiduciary Obligation.  by Chiron if the 
Chiron Board of Directors shall have determined reasonably 
and in good faith, upon the advice of outside Delaware 
counsel, that such termination is required by its fiduciary 
duties to Chiron stockholders under applicable laws, by 
reason of an alternative, bona-fide offer having been made 
for the acquisition of the Company and its Subsidiaries or 
of all or substantially all of their businesses;

8.1.5	Purchaser's Breach.  by Chiron (a) if 
the Purchaser shall refuse or fail after notice to perform 
any material covenant or agreement required to be performed 
by it under this Agreement or (b) if any representation or 
warranty of the Purchaser contained in this Agreement shall 
prove to have been inaccurate or misleading in any material 
respect at the time when made;

8.1.6	Reserved.

8.1.7	Chiron's Breach.  by the Purchaser (a) 
if Chiron shall refuse or fail after notice to perform any 
material covenant or agreement required to be performed by 
it under this Agreement and such failure is not reasonably 
capable of being cured or, if capable of being cured, is not 
cured by Chiron by the earlier of thirty days after the 
receipt of notice thereof, or (b) if Chiron breaches any 
material covenant under Section 4.2, and such breach would 
reasonably be expected to have a material adverse effect on 
the assets, properties, condition (financial or otherwise), 
results of operations, or the business of the Company and 
its Subsidiaries taken as a whole, and such breach is not 
reasonably capable of being cured or, if capable of being 
cured, is not cured by Chiron within 30 days after receipt 
of notice thereof.

8.1.8	Failure of a Chiron Condition.  by 
Chiron at any time after the date hereof if any event occurs 
or condition exists which would render impossible the 
satisfaction of one or more conditions to the obligations of 
Chiron to consummate the transactions contemplated by this 
Agreement as set forth in Section 7.1 or Section 7.3 and 
such event or condition is not reasonably capable of being 
cured or, if capable of being cured, is not cured by the 
Purchaser within 30 days after the receipt of notice of such 
event or condition; and

8.1.9	Failure of a Purchaser Condition.  by 
the Purchaser at any time after the date hereof if the 
satisfaction of one or more conditions to the obligations of 
the Purchaser to consummate the transactions contemplated by 
this Agreement as set forth in Section 7.2.1 or Section 
7.2.13 has become impossible, and is not reasonably capable 
of being cured or, if capable of  being cured, is not cured 
by Chiron within 30 days after receipt of such notice of 
such fact.

8.2	Notice.  Any party desiring to terminate this 
Agreement pursuant to this Section shall give written notice 
of termination to the other party.

8.3	Effect of Termination.  Subject to the provisions 
of Section 8.4, if this Agreement is terminated pursuant to 
Section 8.1, such termination shall be without liability of 
any party (or any shareholder, director, officer, employee 
or agent of any party) to any other party to this Agreement.  
The provisions of this Section 8.3 and Section 5.2 shall 
survive any termination hereof.

8.4	Termination Fees.

8.4.1.	Payments by the Purchaser.  In the event 
that the transactions contemplated by this Agreement are not 
consummated by the Purchaser, the Purchaser shall pay to 
Chiron the sum of $15 million in cash as a termination fee, 
unless the reason the transactions have not been consummated 
is based on any of the following: (i) a termination of this 
Agreement by Chiron under Section 8.1.3 or 8.1.4 or because 
of a failure of the condition set forth in Section 7.3.3 or 
(ii) a termination by the Purchaser either under Section 
8.1.7 or 8.1.9, or because of a failure of the condition set 
forth in Section 7.2.3.

8.4.2	Payment by Chiron.  If this Agreement is 
terminated by Chiron pursuant to Section 8.1.4, Chiron shall 
immediately pay to the Purchaser the sum of $15 million in 
cash as a termination fee.


ARTICLE IX

Representations and Warranties; Indemnities; Survival

9.1	Chiron General Indemnity.  Chiron shall indemnify 
and hold harmless the Purchaser and its Affiliates and their 
respective directors, officers, employees and agents against 
any and all Losses arising out of or attributable to the 
following matters:

9.1.1	Representations, Warranties and 
Covenants.

(a)	The breach or inaccuracy of any 
representation or warranty of Chiron contained in this 
Agreement, (b) any matter (other than third party 
claims) included on an Amended Schedule arising after 
the date of this Agreement but before the Closing that 
would have constituted a breach or inaccuracy of any 
representation or warranty of Chiron had it occurred 
prior to the date of this Agreement and not been 
disclosed and (c) the breach or failure to perform any 
covenant or agreement to be performed by Chiron or any 
of its Affiliates under this Agreement other than under 
Section 4.2 and Section 4.5.  Chiron, however, shall 
not be liable for any indemnity amounts in respect of 
Losses under this Section 9.1.1 unless (i) the amount 
of such Losses (less payments received from insurance 
and third party indemnification, subject to the 
provisions of Section 9.4) relating to any claim made 
by a third party against the Company or any Subsidiary 
for infringement of a patent to the extent arising out 
of or attributable to any act or omission that occurred 
prior to the Closing (other than claims identified on 
Schedule 2.13) exceeds $2.5 million individually, or 
(ii) in any other case, the amount of such Losses 
exceeds $1 million individually and in both cases 
exceeds $5 million in the aggregate, in which event 
Chiron shall indemnify and hold harmless the Purchaser 
and its Affiliates and their respective directors, 
officers, employees and agents for all Losses related 
to an individual claim that exceeds $2.5 million or $1 
million, as the case may be, including the first $1 
dollar of such claims.  The indemnity obligations of 
Chiron under this Section 9.1.1 shall expire upon the 
conclusion of the second year-end audit following the 
Closing, but in no event later than the conclusion of 
the audit of the Company's financial statements for the 
period ending December 31, 1998.

9.1.2	Third Party Claims.

(a)	Any claim asserted against the Company 
or any of its Subsidiaries by a third party after the 
Closing to the extent arising out of or attributable to 
any act or omission that occurred prior to the date of 
this Agreement, except to the extent reserved against 
in, or reflected as a liability on, the Audited Balance 
Sheet or the Schedules, (b) any third party claim 
arising out of or attributable to the matters disclosed 
on Schedule 9.1.2(b), (c) any product liability claims 
against the Company or its Subsidiaries disclosed on 
Schedule 9.1.2(c) to the extent the Company and its 
Subsidiaries do not receive insurance proceeds or third 
party indemnification, and (d) any third party claim to 
the extent arising out of or attributable to any act or 
omission that occurred after the date of this Agreement 
but before the Closing and is disclosed to the 
Purchaser on an Amended Schedule other than matters 
expressly permitted or consented to by the Purchaser 
under Section 4.2 and Section 4.5.  Chiron, however, 
shall not be liable for any indemnity amounts in 
respect of Losses under this Section 9.1.2 unless the 
amount of such Losses, less payments received from 
insurance and third party indemnification, subject to 
Section 9.4, received by the Purchaser after pursuing 
the same in accordance with Section 9.4 exceeds $5 
million in aggregate and (i) $50,000 with respect to 
any single claim under subparagraph (a) and (ii) 
$100,000 with respect to any single claim under 
subparagraph (d), in which events Chiron shall 
indemnify and hold harmless the Purchaser and its 
Affiliates and their respective directors, officers, 
employees and agents for 50% of all such Losses in 
excess of the applicable threshold.  Losses indemnified 
under this Section 9.1.2 shall (i) include costs and 
expenses of defense of such third party claims as well 
as amounts paid to such third party claimants (whether 
by way of final court order or out-of-court settlement) 
and (ii) shall exclude any other Losses arising out of 
or attributable to such third party claims, including 
without limitation, costs and expenses incurred to 
effect any change to the assets, properties, condition 
or business of the Company and its Subsidiaries.  The 
indemnity obligations of Chiron under this Section 
9.1.2 shall expire upon the date two years after the 
Closing.

9.1.3	Environmental Claims.  Any Losses of the 
Company or any Subsidiary arising out of the violation of 
any Environmental Law which violation occurred prior to the 
Closing.  Chiron shall indemnify and hold harmless the 
Purchaser and its Affiliates and their respective directors, 
officers, employees and agents for all such Losses (after 
insurance and third party indemnification, subject to the 
provisions of Section 9.4).  The indemnity obligations of 
Chiron under this Section shall expire upon the date five 
years after the Closing.

9.1.4	Tax Losses.  Losses related to Tax 
matters are expressly excluded from Section 9.1 and Article 
IX (except with respect to indemnification procedures, which 
shall be governed by Section 9.3) and instead shall be 
governed by the provisions of Article VI.

9.1.5	Liability Limits.  The obligations of 
Chiron to indemnify the Purchaser under Section 9.1 for 
Losses incurred as a result of any claims asserted against 
the Company or against the Purchaser arising out of any 
violations of any Environmental Laws, Regulatory Law or 
alleged or actual infringement by the Company or any 
Subsidiary of any patent of any other Person shall be 
limited to an aggregate maximum of $100 million.  The 
obligations of Chiron to indemnify the Purchaser under any 
other clause or provision in Section 9.1 for Losses incurred 
by the Company or by the Purchaser shall be limited to an 
aggregate maximum of $50 million.  The obligations of Chiron 
to indemnify the Purchaser under Section 9.1 and under the 
provisions of Article VI with respect to any tax matter or 
as a result of fraud on the part of Chiron shall not be 
limited as to amount.

9.1.6	Miscellaneous.  Notwithstanding anything 
to the contrary contained herein, neither party hereto (the 
"Indemnitor") shall be responsible for indemnifying the 
other party or its Affiliates or any of their respective 
directors, officers, employees or agents (collectively, the 
"Indemnitee") for any consequential damages incurred by 
the Indemnitee, including loss of profits of the Indemnitee, 
resulting from any event giving rise to the Indemnitee's 
indemnity claim.  This Article IX shall constitute exclusive 
remedy for any and all claims arising out of the 
transactions contemplated hereby.  This Section 9.1.6 shall 
survive any termination of this Agreement.

9.2	Purchaser General.  The Purchaser shall indemnify 
and hold harmless Chiron and its Affiliates and their 
respective directors, officers, employees and agents against 
any and all Losses to the extent arising out of or 
attributable to (a) the inaccuracy of any representation and 
warranty of the Purchaser contained in this Agreement and 
(b) the breach or failure to perform any covenant or 
agreement to be performed by the Purchaser under this 
Agreement.

9.3	Indemnification Procedures.  Any person seeking 
indemnity pursuant to Section 9.1 or Section 9.2 (the 
"Indemnified Party") shall use its reasonable efforts to 
notify the indemnifying party in writing promptly upon 
becoming aware of any claim, suit, proceeding or liability 
to which such indemnification may apply; provided however 
that any failure to provide such notice shall not constitute 
a waiver of the indemnifying party's indemnity obligations 
hereunder except to the extent the indemnifying party is 
actually prejudiced in defense of a third party's claim 
against the Indemnified Party.  The indemnifying party shall 
have the right, within ten business days of receipt of 
notice thereof, to assume and control the defense and 
settlement of, a third party's claim, suit or proceeding 
against the Indemnified Party (a "Third Party Claim") at 
the indemnifying party's sole cost and expense and with 
counsel reasonably satisfactory to the Indemnified Party; 
provided, however, that the indemnifying party will not have 
the right to assume the defense of any Third Party Claim 
that seeks criminal penalties.  If the indemnifying party's 
right to assume the defense is exercised, the indemnifying 
party shall be deemed to have waived all rights to contest 
its liability to the Indemnified Party in respect of such 
Third Party Claim.  The Indemnifying Party will not settle 
or compromise any Third Party Claim that it elects to defend 
without the prior written consent of the Indemnified Party, 
which consent will not be unreasonably withheld.  If the 
right to assume and control the defense is exercised, the 
Indemnified Party shall have the right to participate in, 
but not control, such defense at its own expense and the 
indemnifying party's indemnity obligations shall be deemed 
not to include attorneys' fees and litigation expenses 
incurred in such participation by the Indemnified Party 
after the assumption of the defense by the indemnifying 
party.  If the indemnifying party does not assume the 
defense of the Third Party Claim, the Indemnified Party may 
defend and settle the Claim for the account and cost of the 
indemnifying party; provided, that the Indemnified Party 
will not settle the Third Party Claim without the prior 
written consent of indemnifying party, which consent will 
not be unreasonably withheld.  The indemnifying party will 
promptly pay, or reimburse the Indemnified Party for payment 
of, costs and expenses (including fees and expenses of 
counsel) incurred in the defense thereof.  The Indemnified 
Party shall cooperate with the indemnifying party and, 
subject to obtaining proper assurances of confidentiality 
and privilege, will make available to the indemnifying party 
all pertinent information under the control of the 
Indemnified Party.

9.4	Pursuit of Insurance and Third Party 
Indemnification.  The Purchaser shall consult with Chiron 
regarding the pursuit of insurance and third party 
indemnification and, subject to the following sentence, the 
Purchaser will diligently pursue insurance and third party 
indemnification for a period of one year.  Notwithstanding 
the foregoing, the Purchaser shall have no obligation to 
continue to diligently pursue insurance or third party 
indemnification in the event it reasonably determines that 
such pursuit would require it to institute legal proceedings 
or is not likely to result in any recovery; provided that at 
the time of any such determination, the Purchaser shall 
either assign to Chiron the right to pursue such insurance 
or third party indemnification or, upon Chiron's request and 
at Chiron's expense, pursue such insurance or third party 
indemnification on Chiron's behalf.

9.5	Survival.  Any matter as to which a claim has been 
asserted by notice to the other party that is pending or 
unresolved at the end of any applicable limitation period or 
on any applicable expiration date of such other party's 
indemnity obligations hereunder shall continue to be covered 
by this Article IX notwithstanding any applicable expiration 
of any party's indemnity obligations set forth in this 
Article IX until such matter is finally terminated or 
otherwise resolved by the parties or by a court of competent 
jurisdiction and any amounts payable hereunder are finally 
determined and paid.


ARTICLE X

Certain Definitions

10.1	Certain Definitions.  For all purposes of this 
Agreement, except as otherwise expressly provided or unless 
the context otherwise requires:

"Affiliate" means a Person that directly, or 
indirectly through one or more intermediaries, controls, or 
is controlled by, or is under common control with, a 
specified Person.  For the purposes of this definition, 
"control" (including, with correlative meanings, the terms 
"controlling", "controlled by" and "under common control 
with"), as applied to any Person, means (a) the possession, 
directly or indirectly, of the power to direct or cause the 
direction of the management and policies of that Person, 
whether through the ownership of voting securities or by 
contract or otherwise, or (b) the ownership of more than 25% 
of the voting securities of that Person.  Notwithstanding 
anything to the contrary contained herein, "Affiliate" 
shall not include, in the case of Chiron, Novartis AG or any 
Affiliate of Novartis (other than Chiron and its 
subsidiaries).

"Agreed Procedure" shall mean, when used with 
reference to the Closing Date Balance Sheet, that such 
Balance Sheet will be prepared from the books and records of 
the Company in accordance with GAAP in a manner consistent 
with past practices, except that the standard of materiality 
applicable shall be that which would be appropriate for the 
Company as an independent entity without regard to its 
consolidation with Chiron.

"Agreement" means this Agreement by and among Chiron 
and the Purchaser, as amended or supplemented together with 
all Exhibits and Schedules attached or incorporated by 
reference.

"Centaur" shall mean Chiron's wholly-owned captive 
insurance subsidiary.

"Claremont Property" shall mean the real property and 
improvements thereon owned by the Company and located in 
Claremont, California.

"Code" shall mean the United States Internal Revenue 
Code of 1986, as amended.

"Environmental Laws" shall mean all laws relating to 
the protection of the environment including all requirements 
pertaining to reporting, licensing, permitting, controlling, 
investigating, or remediating emissions, discharges, 
releases, or threatened releases of Hazardous Substances, 
chemical substances, pollutants, contaminants or toxic 
substances, materials or wastes, whether solid, liquid or 
gaseous in nature, into the air, surface water, groundwater 
or land, or relating to the manufacture, processing 
distribution, use, treatment, storage, disposal, transport 
or handling of Hazardous Substances, chemical substances, 
pollutants, contaminants or toxic substances, materials or 
wastes, whether solid, liquid or gaseous in nature.

"ERISA" shall mean the Employee Retirement Income 
Security Act of 1974, as amended.

"ERISA Affiliate" shall mean any company that, as of 
the relevant measuring date under ERISA, is a member of a 
controlled group of corporations or under common control 
with the Company or any Subsidiary within the meaning of 
Section 414(b) and (c) of the Code.

"GAAP" shall mean generally accepted accounting 
principles in the United States as in effect from time to 
time.

"Hazardous Substances" shall mean substances that are 
defined or listed in, or otherwise classified pursuant to, 
any applicable laws as "hazardous substances," "hazardous 
materials," "hazardous wastes" or "toxic substances," or 
any other formulation intended to define, list or classify 
substances by reason of deleterious properties such as 
ignitability, corrosivity, reactivity, radioactivity, 
carcinogenicity, reproductive toxicity or "EP toxicity," 
and petroleum and drilling fluids, produced waters and other 
wastes associated with the exploration, development, or 
production of crude oil, natural gas or geothermal energy.

"Huntington Lease" shall mean the lease dated 
September 12, 1991 between Acorn Development, Inc. and 
Intraoptics, Inc.

"Knowledge" shall mean, with respect to any Person, 
the actual knowledge of any officer of such Person, the law 
department of such Person or any other employee of such 
Person with responsibility for the particular subject area 
or subject matter.

"Lien" shall mean any mortgage, pledge, security 
interest, lien, charge, encumbrance, equity, claim, option, 
tenancy, right or restriction on transfer of any nature 
whatsoever.

"Loss" shall mean any loss, damage, liability, cost, 
deficiency, assessment and expense including, without 
limitation, any interest, fine, court cost and reasonable 
investigation cost, penalty and attorneys' and expert 
witnesses' fees, disbursements and expenses, but shall not 
include any component of damages for lost profits of, or 
consequential damages suffered by, Chiron, the Purchaser, 
the Company, its Subsidiaries or any of their respective 
Affiliates or any of their respective directors, officers, 
employees and agents.

"Lyon Reserve" shall mean an amount reflected on the 
Audited Balance Sheet and the Closing Date Balance Sheet as 
a reserve for rental obligations in excess of market value 
under the lease dated January 2, 1990 between Domilyon 
Corporation and Domilens Laboratories, as amended by a First 
Amendment dated May 10, 1994.

"Milton Keynes Lease" shall mean the lease dated May 
25, 1990 between Milton Keynes Development Corporation and 
Intraoptics (UK) Limited.

"Net Assets" shall mean, when used with reference to 
the Audited Balance Sheet and the Closing Date Balance Sheet 
(prepared in accordance with the Agreed Procedure in the 
case of the Closing Date Balance Sheet), as the case may be, 
total assets of the Company adjusted for purposes of 
calculating the Upward Purchase Price Adjustment or Downward 
Purchase Price Adjustment, as the case may be, by excluding 
(a) cash, (b) the net value (gross value minus depreciation) 
of the Claremont Property, (c) intangible assets, net of 
accumulated amortization, consisting of purchased 
technology, patents, licenses, goodwill, tradenames, 
customer lists and start up costs (except for consideration 
provided to Luis Ruiz and Sergio Lenchig capitalized in 
accordance with GAAP), (d) any deferred tax assets for which 
the Company will not obtain a future benefit as a result of 
the Section 338(h)(10) election, and (e) with respect to the 
Closing Date Balance Sheet only, any amounts paid prior to 
or as of the Closing Date to Johann F. (Hans) Hellenkamp 
which are capitalized on the Closing Date Balance Sheet in 
accordance with GAAP other than amounts creditable against 
royalties accruing following the Closing (not to exceed 
$250,000), less (i) current liabilities other than current 
portion of long-term liabilities except the portion of such 
liabilities relating to capital leases), (ii) long-term 
capital leases, (iii) that portion of the Lyon Reserve which 
corresponds to periods following September 30, 1998, and 
(iv) with respect to the Closing Date Balance Sheet only two 
times the value of (A) the note payable to CEMPE with a 
maturity date of October 31, 1999, (B) that portion of the 
Lyon Reserve that corresponds to periods prior to September 
30, 1998, (C) other long-term liabilities including taxes, 
but excluding any deferred tax liabilities which the Company 
will not be obligated to pay as a result of the Section 
338(h)(10) election, (D) obligations relating to the Milton 
Keynes Lease and the Huntington Lease (unless such leases 
shall have been assigned to Chiron with any requisite 
consents, and Chiron shall have assumed such obligations 
effective as of the Closing Date), and (E) the current 
portion of long-term liabilities except the portion of such 
liabilities relating to capital leases.

"Permit" shall mean any license, permit, franchise, 
certificate of authority, or order, or any waiver of the 
foregoing, required to be issued by any Governmental Entity.

"Permitted Liens" shall mean the following types of 
Liens: (a) statutory Liens of landlords, statutory Liens of 
banks and rights of set-off, statutory Liens of carriers, 
warehousemen, mechanics, repairmen, workmen and materialmen, 
and other Liens imposed by law, in each case incurred in the 
ordinary course of business (i) for amounts not yet overdue 
or (ii) for amounts that are overdue and that (in the case 
of such amounts overdue for a period in excess of 30 days) 
are being contested in good faith by appropriate 
proceedings, so long as such reserves or other appropriate 
provisions, if any, as shall be required by GAAP shall have 
been made for any such contested amounts; (b) easements, 
rights-of-way, restrictions, encroachments, and other minor 
defects or irregularities in title, in each case which do 
not and will not interfere in any material respect with the 
ordinary conduct of the business of Company or any of its 
Subsidiaries; (c) Liens in favor of customs and revenue 
authorities arising as a matter of law to secure payment of 
customs duties in connection with the importation of goods; 
and (d) any zoning or similar law or right reserved to or 
vested in any governmental office or agency to control or 
regulate the use of any real property and (e) Liens that do 
not either adversely affect the value of the real property 
subject to such Lien or prohibit or interfere with the 
operations of that real property or the business of the 
Company or the Subsidiaries.

"Person" shall mean an individual, a partnership, a 
joint venture, a corporation, a trust, an unincorporated 
organization, a governmental entity or any other entity.

"Products" shall mean products, technology and 
services, manufactured, sold, licensed, or otherwise 
exploited by the Company or any Subsidiary in connection 
with their business prior to the Closing.

"Regulatory Law" shall mean the FDC Act or any 
similar or analogous legislation in any foreign jurisdiction 
and the regulations of the FDA or any similar or analogous 
foreign governmental entity or body.

"Schedule" means a disclosure schedule delivered by 
Chiron to the Purchaser prior to the date of this Agreement 
and "Amended Schedule" means an amendment to a Schedule, 
delivered by Chiron to the Purchaser prior to the Closing, 
that includes disclosure of events occurring or facts 
arising after the date of this Agreement.

"Tax Return" means a report, return or other 
information required to be supplied to a governmental entity 
or body with respect to Taxes including, where permitted or 
required, combined or consolidated returns for any group of 
entities that includes the Company or any Subsidiary.


	ARTICLE XI

	Miscellaneous

11.1	Amendments.  This Agreement may not be amended or 
modified except by express written consent of the parties 
hereto in an agreement or instrument of comparable 
significance to this Agreement.

11.2	Assignment.  Neither party may assign this 
Agreement or its rights or obligations hereunder, whether by 
operation of law or otherwise, to any third party without 
the prior written consent of the other party.

11.3	Notices.  All notices or communications hereunder 
shall be sent by overnight mail by courier of nationally 
recognized standing addressed as follows (or such other 
address as such party may designate in writing):

To Chiron:

Chiron Corporation
4560 Horton Street
Emeryville, California  94608-2916
Attention:  Chief Executive Officer
Telefax:  (510) 655-6281

With a copy to:

Chiron Corporation
4560 Horton Street
Emeryville, California  94608-2916
Attention:  General Counsel
Telefax:  (510) 654-5360

To the Purchaser:

Bausch & Lomb Incorporated
One Bausch & Lomb Place
Rochester, New York  14604
Attention:  Chief Executive Officer
Telefax:  (716) 338-6805

With a copy to:

Bausch & Lomb Incorporated
One Bausch & Lomb Place
Rochester, New York  14604
Attention:  General Counsel
Telefax:  (716) 338-8706

Any notice hereunder shall be effective upon receipt by the 
intended recipient.

11.4	Severability.  If any provision of this Agreement 
shall be held to be invalid or otherwise unenforceable under 
applicable law, such provision shall be deemed severed and 
all other provisions shall nevertheless continue in full 
force and effect; provided that the parties shall negotiate 
in good faith to resolve any inequities created by such 
partial unenforceability.

11.5	Counterparts.  This Agreement may be executed in 
counterparts, all of which together shall constitute one and 
the same instrument.

11.6	Governing Law.  This Agreement shall be governed 
by and construed in accordance with the laws of the State of 
California.

11.7	Interpretation.  When a reference is made in this 
Agreement to an Article, Section, Exhibit or Schedule, such 
reference is to an Article or Section of, or an Exhibit or 
Schedule to, this Agreement unless otherwise indicated.  The 
table of contents and headings contained in this Agreement 
are for reference purposes only and shall not affect in any 
way the meaning or interpretation of this Agreement.  
Whenever the words "include," "includes" and 
"including" are used in this Agreement, they are deemed to 
be followed by the words "without limitation."  For all 
purposes of this Agreement, except as otherwise expressly 
provided or unless the context otherwise requires, (a) the 
terms defined include the plural as well as the singular, 
(b) all accounting terms not otherwise defined herein have 
the meanings assigned under GAAP, and (c) the words 
"herein," "hereof" and "hereunder" and other words of 
similar import refer to this Agreement as a whole and not to 
any particular Article, Section or other subdivision.

11.8	Entire Agreement.  This Agreement, together with 
any agreement executed and delivered by the parties 
concurrently herewith and the Schedules and Exhibits 
attached hereto, constitutes the entire agreement between 
the Purchaser and Chiron with respect to the subject matter 
hereof.  There are no representations, warranties, covenants 
or undertakings with respect to the subject matter hereof 
other than those expressly set forth herein.  This Agreement 
supersedes all prior agreements between the parties with 
respect to the Stock purchased hereunder and the subject 
matter hereof.

11.9	Publicity.  The parties jointly will prepare a 
news release or other announcement regarding this Agreement 
and, subject to their respective legal obligations 
(including requirements of the New York Stock Exchange and 
other similar regulatory bodies), thereafter will consult 
with each other regarding the text of any press release or 
other public statement (including any filings with any 
federal or state governmental or regulatory agency) relating 
to the transaction contemplated by this Agreement prior to 
any release or filing thereof.

11.10	Efforts; Further Assurances.  Each party will 
use its commercially reasonable efforts to cause all 
conditions to its obligations hereunder to be timely 
satisfied and to perform and fulfill all obligations on its 
part to be performed and fulfilled under this Agreement, to 
the end that the transactions contemplated by this Agreement 
shall be effected substantially in accordance with its terms 
as soon as feasible.  The parties shall cooperate with each 
other in such actions and in securing requisite approvals, 
consents and authorizations.  Each party shall execute and 
deliver both before and after the Closing such further 
certificates, agreements and other documents and take such 
other actions as the other party may reasonably request as 
may be necessary or appropriate to consummate or implement 
the transactions contemplated hereby or to evidence such 
events or matters.  Each party agrees to cause its 
subsidiaries to comply with any obligations hereunder 
relating to such subsidiaries and to cause its subsidiaries 
to take any other action which may be necessary or 
reasonably requested by the other party in order to 
consummate the transactions contemplated by this Agreement.

11.11	Expenses.  Subject to Article VI and Article 
IX, Chiron and the Purchaser shall each pay their own 
expenses incident to the negotiation, preparation and 
performance of this Agreement and the transactions 
contemplated hereby, including but not limited to the fees, 
expenses and disbursements of their respective investment 
bankers, accountants and counsel.  Any such expenses of 
Company and the Subsidiaries shall be paid by Chiron on or 
prior to the Closing.

IN WITNESS WHEREOF, this Agreement has been executed 
and delivered as of the date first above written, by the 
duly authorized representatives of the parties hereto.


BAUSCH & LOMB INCORPORATED



By:___________________________
William M. Carpenter
President and Chief
Executive Officer


By:___________________________
Stephen C. McCluski
Senior Vice President,
Finance


CHIRON CORPORATION


By:___________________________
Edward E. Penhoet, Ph.D.
President and Chief
Executive Officer

EX-2

                   	PURCHASE AGREEMENT


		THIS PURCHASE AGREEMENT dated as of October 21, 1997 
(this "Agreement") by and among AMERICAN CYANAMID COMPANY, a 
Maine corporation ("Cyanamid"), AMERICAN HOME PRODUCTS 
CORPORATION, a Delaware corporation ("AHP" and, together with 
Cyanamid, "Sellers"), and BAUSCH & LOMB INCORPORATED, a New 
York corporation ("Buyer").


                  	W I T N E S S E T H:


		WHEREAS, Sellers desire to sell to Buyer, and Buyer 
desires to acquire from Sellers, the Business (as defined 
herein), which the parties agree will be effected by the purchase 
and sale of the Shares (as defined herein) and the Assets (as 
defined herein), all on the terms and subject to the conditions 
set forth herein;

		WHEREAS, Cyanamid owns and has the legal right and 
authority to sell, transfer, assign and deliver the Storz Shares 
(as defined herein) of STORZ INSTRUMENT COMPANY, a Missouri 
corporation ("Storz"), and the Ophthalmics Shares (as defined 
herein) of STORZ OPHTHALMICS, INC., a Delaware corporation 
("Ophthalmics"), which Shares constitute all of the issued and 
outstanding shares of capital stock of Storz and Ophthalmics, 
respectively;

		WHEREAS, AHP indirectly owns and has the legal right 
and authority to cause its subsidiaries to sell, transfer, assign 
and deliver the Chirurgie Shares (as defined herein) of Cyanamid 
Chirurgie S.A.S., a company organized under the laws of France 
("Chirurgie"), which Shares constitute all of the issued and 
outstanding shares of capital stock of Chirurgie;

		WHEREAS, the Assets are owned by Sellers or their 
Affiliates and Sellers desire to sell to Buyer, and desire that 
such Affiliates sell to Buyer, and Buyer desires to purchase from 
Sellers and such Affiliates, the Assets, and in connection with 
such purchase and sale, Buyer is willing to assume certain 
liabilities of Sellers and such Affiliates and to employ the  
employees of Sellers and such Affiliates related to the Business, 
all on the terms and conditions herein set forth;

		NOW, THEREFORE, in consideration of the foregoing 
premises and the representations, warranties, covenants and 
agreements herein contained, the parties hereto, intending to be 
legally bound, agree as follows:


 	ARTICLE I
	DEFINITIONS
 
 		Whenever used in this Agreement, unless otherwise 
clearly indicated by the context, the terms defined below shall 
have the indicated meanings:
 	
 
ARTICLE 1.1 	"Accountant" shall have the meaning 
set forth in Section 3.5.3.
 
ARTICLE 1.2 	"Affiliate" shall mean, with respect 
to any Person, any Person which directly or indirectly through 
stock ownership or through other arrangements either controls, or 
is controlled by or is under common control with, such Person, 
provided, however, for purposes of this Agreement the term 
"Affiliate" shall not include subsidiaries or other entities in 
which a Person owns a majority of the ordinary voting power to 
elect the majority of the board of directors or other governing 
board but is restricted from electing such majority by contract 
or otherwise, until such time as such restrictions are no longer 
in effect.
 
ARTICLE 1.3 	"Agreement" shall mean this Agreement 
and any supplements, amendments, Exhibits and Schedules hereto.
 
ARTICLE 1.4 	"Aggrieved Party" shall have the 
meaning set forth in Section 11.2.1.
 
ARTICLE 1.5 	"Allocation Schedule" shall have the 
meaning set forth in Section 7.7.5(c).
 
ARTICLE 1.6 	"Applicable Laws" shall mean all laws, 
statutes, regulations, constitutional provisions, ordinances, 
interpretations, decrees, injunctions, judgments, orders, 
rulings, assessments or writs of any Governmental Authority 
having jurisdiction over the Companies, the Assets, and, with 
respect to the Business, the Sellers or the International 
Affiliates in effect at or prior to Closing.
 
ARTICLE 1.7 	"Applicable Permits" shall mean any 
waiver, exemption, variance, permit, authorization, license or 
similar approval, required to be obtained or maintained under 
Applicable Laws in connection with the Companies or the Assets.
 
ARTICLE 1.8 	"Appraisal" shall have the meaning set 
forth in Section 7.7.5(b).
 
 	"Appraiser" shall have the meaning set forth in Section 
7.7.5(b).
 
ARTICLE 1.9 	"Assets" shall mean, collectively, the 
Cyanamid Storz Assets, the Wyeth Storz Assets, and the 
International Assets.
 
ARTICLE 1.10 	"Assumed Contracts" shall mean the 
Cyanamid Storz Assumed Contracts, the International Assumed 
Contracts and the Wyeth-Storz Assumed Contracts.
 
ARTICLE 1.11 	"Assumed Liabilities" shall mean (i) 
the liabilities and obligations of Sellers and/or the 
International Affiliates arising from and after the Closing Date 
under the Assumed Contracts, (ii) any and all liabilities of any 
of the Sellers or the International Affiliates which arise or may 
arise from the transfer of the Assumed Contracts to Buyer or from 
any termination of such Assumed Contracts either by operation of 
law as a result of the transactions contemplated herein or 
through the action of Buyer, and (iii) all liabilities of Sellers 
or the International Affiliates to Cyanamid Storz Employees and 
International Employees which are assumed by Buyer or any 
Affiliate of Buyer pursuant to the provisions of Article 9, and 
(iv) product liability claims against Sellers and the 
International Affiliates relating to occurrences of injuries 
after Closing caused by a product of the Business.  For purposes 
of clarity it is understood that Assumed Liabilities shall relate 
only to the purchase and sale of the Assets and that, by 
operation of law, Buyer is assuming all of the liabilities of the 
Companies, subject to the indemnity provisions set forth herein.
 
ARTICLE 1.12 	"Base Net Asset Value" shall have the 
meaning set forth in Section 3.6.1.
 
ARTICLE 1.13 	"Books and Records" shall mean the 
books and records (including data and information in electronic 
media) of (i) Sellers to the extent related primarily to the 
Cyanamid Storz Business and the Wyeth Storz Business, (ii) the 
International Affiliates to the extent related primarily to the 
International Business, and (iii) the Companies, including the 
minute books, stock books and other corporate records having to 
do with corporate organization and capitalization of the 
Companies and all books of account and income tax records of the 
Companies.
 
ARTICLE 1.14 	"Bundled Contracts" shall mean those 
contracts or other similar agreements set forth in Section 1.15 
of the Disclosure Schedule pursuant to which Sellers are, 
immediately prior to the Closing Date, selling products included 
in the Cyanamid Storz Assets and the Wyeth Storz Assets along 
with other products of Sellers to third party buyers.
 	
ARTICLE 1.15 	"Business" shall refer to the business 
of the Companies together with the Cyanamid Storz Business, the 
Wyeth Storz Business and the International Business, excluding 
the Excluded Assets and the Excluded Liabilities.
 
ARTICLE 1.16 	"Business Field" shall mean all 
products manufactured, sold or distributed as part of the 
Business, including ophthalmic products, surgical equipment, 
implants, pharmaceuticals and hand-held surgical instruments, but 
excluding the Excluded Assets and the Excluded Liabilities.
 
ARTICLE 1.17 	"Chiron Purchase Agreement" shall mean 
the agreement entered into between Buyer and Chiron Corporation 
under which all the issued and outstanding capital stock of CVC 
shall be transferred to Buyer.
 
ARTICLE 1.18 	"Chiron Transaction" shall mean the 
sale of all the issued and outstanding capital stock of CVC to 
Buyer and the transactions related thereto pursuant to the terms 
of the Chiron Purchase Agreement.
 
ARTICLE 1.19 	"Chirurgie Employees" shall mean (i) 
all individuals who, on the Closing Date, are actively employed 
by Chirurgie; and (ii) all individuals who are on short-term 
disability leave, authorized leave of absence granted prior to 
the Closing Date in accordance with the terms of Chirurgie's 
leave policy as in effect on the date of this Agreement or 
military service or layoff with recall rights from Chirurgie as 
of the Closing Date.
 
ARTICLE 1.20 	"Chirurgie Shares" shall mean all the 
issued and outstanding shares of capital stock of Chirurgie.
 
ARTICLE 1.21 	"Cidofovir Co-Promotion Agreement" 
shall mean that certain co-marketing agreement between Buyer and 
Sellers, or their respective Affiliates, with respect to the 
marketing of Cidofovir and related products to the pediatrician, 
internal medicine physician and family physician market, based on 
the principal terms set forth in Exhibit A.
 
ARTICLE 1.22 	"Closing" shall have the meaning set 
forth in Section 3.1.
 
ARTICLE 1.23 	"Closing Date" shall have the meaning 
set forth in Section 3.1.
 
ARTICLE 1.24 	"Closing Net Asset Value" shall have 
the meaning set forth in Section 3.5.1.
 
ARTICLE 1.25 	"Closing Statement" shall have the 
meaning set forth in Section 3.5.1.
 
ARTICLE 1.26 	"Code" shall mean the Internal Revenue 
Code of 1986, as amended.
 
ARTICLE 1.27 	"Companies" collectively, and 
"Company" individually, shall mean Ophthalmics, Storz, Storz 
GmbH and/or Chirurgie, as the case may be.
 
ARTICLE 1.28 	"Competitive Business" shall have the 
meaning set forth in Section 7.8.2.
 
ARTICLE 1.29 	"Competition Laws" shall mean all 
Applicable Laws that are designed or intended to prohibit, 
restrict or regulate actions or conduct which may have the effect 
of monopolizing or restraining trade or otherwise may lessen 
competition.
 
ARTICLE 1.30 	"Contracts" shall mean (i) all leases, 
subleases, rental agreements, insurance policies, sales orders, 
licenses, agreements, employee plans, purchase orders, 
instruments of indebtedness, guarantees and any and all other 
contracts or binding arrangements to which one or more of the 
Companies is a party, and (ii) the Assumed Contracts, but shall 
not include any contracts or other binding arrangements related 
exclusively to the Excluded Assets.
 
ARTICLE 1.31 	"Costs" shall have the meanings set 
forth in Section 11.1.
 
ARTICLE 1.32 	"CVC" shall mean Chiron Vision 
Corporation, a Delaware corporation.
 
ARTICLE 1.33 	"Cyanamid Storz Assets" shall mean 
collectively (i) those fixed assets (including machinery, 
apparatus, furniture and other equipment) located at Pearl River, 
N.Y., listed in Section 1.34 of the Disclosure Schedule; (ii) 
Intellectual Property listed in Section 1.34 of the Disclosure 
Schedule, (iii) the rights of Cyanamid under the Cyanamid Storz 
Assumed Contracts, (iv) all materials, supplies, owned motor 
vehicles, and other equipment exclusively used in connection with 
the Cyanamid Storz Business, (v) all inventory of finished 
products (and related promotional and sales materials) held for 
sale or used primarily in connection with the Cyanamid Storz 
Business as of the date hereof, together with any additions 
thereto and subject to any reductions therefrom received or 
incurred in operating the Cyanamid Storz Business in the ordinary 
course after the date hereof through the Closing Date, (vi) all 
prepaid expenses as of the date hereof, together with any 
additions thereto and subject to any reductions therefrom made or 
accrued by Cyanamid in operating the Cyanamid Storz Business in 
the ordinary course and in compliance with Article 6 after the 
date hereof through the Closing Date, (vii) sales data, customer 
lists, information relating to customers, suppliers' names, 
mailing lists, and, if any, advertising matter and all rights 
thereto to the extent exclusively relating to the Cyanamid Storz 
Business, and (viii) all transferable Applicable Permits 
exclusively related to the Cyanamid Storz Business.
 
ARTICLE 1.34 	"Cyanamid Storz Assumed Contracts" 
shall mean the Contracts listed in Section 1.35 of the Disclosure 
Schedule.
 
ARTICLE 1.35 	"Cyanamid Storz Business" shall mean 
the activities conducted in the United States by Cyanamid and 
outside the United States by the International Affiliates 
relating primarily to the ophthalmic pharmaceutical products of 
the Companies listed in Section 1.36 of the Disclosure Schedule, 
excluding the Excluded Assets and Excluded Liabilities.
 
ARTICLE 1.36 	"Cyanamid Storz Employees" shall mean 
(i) those employees of Cyanamid whose employment responsibilities 
relate primarily to the Cyanamid Storz Business, including those 
employees who are on short-term disability leave, authorized 
leave of absence granted prior to the Closing Date in accordance 
with the terms of Cyanamid's leave policy as in effect as of the 
date of this Agreement or military service or lay-off with recall 
rights from Cyanamid as of the Closing Date.  Each Cyanamid Storz 
Employee on the date hereof is listed in Section 1.37 of the 
Disclosure Schedule.
 
ARTICLE 1.37 	"Diamox, Neptazane, and Phospholine 
Iodide Co-Promotion Agreement" shall mean that certain co-
promotion agreement between Buyer and Sellers, or their 
respective Affiliates, with respect to Sellers' Diamox, Neptazane 
and Phospholine Iodide products, based on the principal terms set 
forth in Exhibit B hereto.
 
ARTICLE 1.38 	"Disclosure Schedule" shall mean that 
certain schedule identified as such, dated the date of this 
Agreement and delivered by Sellers to Buyer pursuant to this 
Agreement, as the same may be supplemented and updated from time 
to time pursuant to this Agreement.
 
ARTICLE 1.39 	"Employees" shall mean the Storz 
Employees, the Cyanamid Storz Employees, the International 
Employees, the Chirurgie Employees and the Storz GmbH Employees.
 
ARTICLE 1.40 	"Encumbrances" shall mean all claims, 
security interests, liens, pledges, charges, escrows, options, 
proxies, rights of first refusal, preemptive rights, mortgages, 
hypothecations, prior assignments, title retention agreements, 
indentures, security agreements, leases, easements, encumbrances, 
or restrictions (whether on voting, sale, transfer, disposition 
or otherwise), whether imposed by agreement, law, equity or 
otherwise, except for any restrictions on transfer arising under 
any Applicable Law.
 
ARTICLE 1.41 	"Environmental Laws" shall mean all 
Applicable Laws relating to the protection of human health, 
safety and the environment including the Comprehensive 
Environmental Response Compensation and Liability Act, as amended 
(42 U.S.C. Section 9601 et seq.) ("CERCLA"), the Federal Solid Waste 
Disposal Act, as amended by the Resource Conservation and 
Recovery Act and the Hazardous and Solid Waste Amendments 
thereto, the Clean Air Act, the Clean Water Act, the Toxic 
Substances Control Act, the Safe Drinking Water Act, the 
Occupational Safety and Health Act and any similar or analogous 
statutes, or regulations of any Governmental Authority, as each 
of the foregoing exists on the date hereof.
 
ARTICLE 1.42 	"ERISA" shall mean the Employee 
Retirement Income Security Act of 1974, as amended, and the 
related regulations and published interpretations
 
ARTICLE 1.43 	"ERISA Affiliate" shall mean (i) any 
corporation which is a member of a group of corporations of which 
any Seller, any International Affiliate or a Company is a member 
and which is a controlled group of corporations within the 
meaning of Section 414(b) of the Code; (ii) any trade or business 
(whether or not incorporated) which is a member of a group of 
trades or businesses under common control within the meaning of 
Section 414(c) of the Code of which any Seller, any International 
Affiliate or a Company is a member; and (iii) a member of an 
affiliated service group within the meaning of Section 414(m) or 
Section 414(o) of the Code of which any Seller, any corporation 
described in clause (i) above or any trade or business described 
in clause (ii) above would be treated as a single employer under 
Section 414 of the Code.
 
ARTICLE 1.44 	"Excluded Assets" shall mean the 
following assets of Sellers, the Companies and/or the 
International Affiliates (all of which are expressly excluded 
from the purchase and sale of the Business contemplated hereby): 
(i) cash, except to the extent provided in Section 3.5.1; (ii) 
Pharmaceutical Receivables; (iii) goodwill for financial 
reporting purposes; (iv) International Receivables; (v) notes 
receivable, including any reserves, in the approximate aggregate 
principal and interest amount as of August 31, 1997 of $2,622,537 
due to Storz from Global Instruments, Inc. and Sparta Medical, 
Inc.; (vi) rights under the Asset Purchase Agreement between 
Storz and Otologics LLC dated July 16, 1996, relating to patents 
and related intellectual property for a middle ear hearing 
device; (vii) any and all rights and assets, including but not 
limited to intellectual property rights and time release 
technology, relating to the products Diamox(R) and Neptazane(R), 
worldwide in any formulations (solid or parenteral), and Sellers 
generic formulations thereof; (viii) all assets relating to any 
of Sellers' joint venture interests relating to the Business; 
(ix) Aureomycin trademark worldwide; (x) all rights under the 
Agreement dated July 28, 1995 between A.H. Robins Company, 
Incorporated and Senju Pharmaceutical Co., Ltd, relating to 
bromfenac as an ophthalmic specialty; (xi) all work-in-progress 
and other non-finished inventory of pharmaceutical products for 
which finished inventory is included in the Business; (xii) all 
rights under the March 11, 1992 AREDS CRADA for application 
outside of ophthalmology; (xiii) Tax Assets; (xiv) intercompany 
assets; (xv) all manufacturing equipment used in the Business 
located at Rouses Point as listed in Section 1.45 of Disclosure 
Schedule; and (xvi) all rights to the use of the "Wave Bottle", 
including without limitation the related intellectual property 
rights listed in Section 1.45 of the Disclosure Schedule.  For 
purposes of clarity, any Excluded Assets contained in any of the 
Companies shall be distributed to Sellers pursuant to Section 
6.2, and the defined term "Excluded Assets" as used herein 
shall refer to assets of the Sellers, Companies and/or 
International Affiliates.
 
ARTICLE 1.45 	"Excluded Liabilities" shall mean the 
following liabilities of Sellers or the International Affiliates 
(but not the Companies), whether absolute, contingent, accrued, 
known or unknown, which are not specifically assumed by Buyer or 
an Affiliate of Buyer pursuant to this Agreement (all of which 
are expressly excluded from the purchase and sale of the Business 
contemplated hereby), including, without limitation:  (i) 
International Payables and Pharmaceutical Payables; (ii) Tax 
Liabilities with respect to International Affiliates and the 
Sellers; (iii) intercompany liabilities; (iv) except as otherwise 
specifically assumed pursuant to the terms of this Agreement, 
including but not limited to Article 9, and, the Assumed 
Liabilities, any liabilities or obligations incurred, arising 
from or out of, in connection with or as a result of claims made 
by or against Sellers or the International Affiliates (but not 
the Companies) whether before or after the Closing Date that 
arise out of events prior to the Closing Date; (v) any 
liabilities or obligations to the Cyanamid Storz Employees or the 
International Employees not specifically assumed pursuant to 
Article 9; and (vi) product liability claims against the Sellers, 
the International Affiliates or Buyer relating to occurrences of 
injuries caused by the products of the Business prior to Closing. 
 For purposes of clarity it is understood that Excluded 
Liabilities shall relate only to the purchase and sale of the 
Assets and that, by operation of law, Buyer is assuming all of 
the liabilities of the Companies, subject to the indemnity 
provisions set forth herein.
 
ARTICLE 1.46 	"FDA" shall have the meaning set forth 
in Section 4.15.
 
ARTICLE 1.47 	"Final Net Asset Value" shall have the 
meaning set forth in Section 3.5.3.
 
ARTICLE 1.48 	"Financial Statements" shall have the 
meaning set forth in Section 4.5.1.
 
ARTICLE 1.49 	"GAAP" shall mean United States 
generally accepted accounting principles.
 
ARTICLE 1.50 	"Governmental Authority" shall mean 
any government or any department, commission, board, bureau, 
agency, court, official, political subdivision, tribunal or other 
instrumentality of any government, whether federal, state or 
local, domestic or foreign, where a Company is now operating or 
has operated or where any of the Assets are located.
 
ARTICLE 1.51 	"HSR Act" shall have the meaning set 
forth in Section 7.5.
 
ARTICLE 1.52 	"Hazardous Substance" shall mean 
substances that are defined or listed in or otherwise classified 
pursuant to any applicable Environmental Laws as "hazardous 
substances", "hazardous materials", "hazardous waste" or 
"toxic substances" and shall specifically include petroleum, 
including crude oil or any fraction thereof, and natural gas in 
its various forms.
 
ARTICLE 1.53 	"Indemnifying Party" shall have the 
meaning set forth in Section 11.2.1.
 
ARTICLE 1.54 	"Intellectual Property" shall mean all 
(i) Patents, (ii) Know-how, (iii) Trademarks and (iv) copyrights, 
copyright registrations and applications for registration, 
inventions, designs, industrial and utility models (including 
registrations and applications for registration thereof), trade 
secrets and all other intellectual property rights whether 
registered or not, in each case which are licensed to or owned by 
any of the Companies and, in the case of Sellers or International 
Affiliates, are exclusively used in connection with the Business.
 
ARTICLE 1.55 	"International Affiliates" shall mean 
those Affiliates of Sellers listed on Section 1.56 of the 
Disclosure Schedule.
 
ARTICLE 1.56 	"International Assets" shall mean 
collectively (i) Intellectual Property listed in Section 1.57 of 
the Disclosure Schedule, (ii) the rights of the International 
Affiliates under the International Assumed Contracts, (iii) all 
machinery, apparatus, furniture, materials, supplies, owned motor 
vehicles and other equipment exclusively used in connection with 
the International Business, (v) all inventory of finished 
products (and related promotional and sales materials) held for 
sale in connection with the International Business as of the date 
hereof, together with any additions thereto and subject to any 
reductions therefrom received or incurred in operating the 
International Business in the ordinary course after the date 
hereof through the Closing Date, (vi) all prepaid expenses as of 
the date hereof, together with any additions thereto and subject 
to any reductions therefrom made or accrued by the International 
Affiliates in operating the International Business, in each case 
in the ordinary course and in compliance with Article 6 after the 
date hereof through the Closing Date, (vii) sales data, customer 
lists, information relating to customers, suppliers' names, 
mailing lists, and, if any, advertising matter and all rights 
thereto primarily relating to the International Business, (viii) 
all transferable Applicable Permits, and (ix) the benefits 
associated with and rights to any overfunded benefit plans with 
respect to Storz GmbH Employees and Chirurgie Employees with 
respect to whom liabilities under such plans are being assumed 
pursuant to Article 9.
 
ARTICLE 1.57 	"International Assumed Contracts" 
shall mean the Contracts listed in Section 1.58 of the Disclosure 
Schedule.
 
ARTICLE 1.58 	"International Business" shall mean 
the business conducted by the International Affiliates relating 
to the manufacture, sale or distribution outside of the United 
States of products manufactured and/or distributed by the 
Companies and the products distributed in connection with the 
Cyanamid Storz Business and Wyeth Storz Business outside the 
United States.
 
ARTICLE 1.59 	"International Employees" shall mean 
those employees of the International Affiliates whose employment 
responsibilities relate primarily to the International Business. 
 Each International Employee as of the date hereof, is listed in 
Section 1.60 of the Disclosure Schedule.
 
ARTICLE 1.60 	"International Inventory" shall mean 
those items referred to in clause (v) of Section 1.57.
 
ARTICLE 1.61 	"International Payables" shall mean 
accounts payable and accruals of the International Affiliates 
relating to the Business.
 
ARTICLE 1.62 	"International Plans" shall mean the 
plans and arrangements referenced in the first sentence of 
Section 9.2.1.
 
ARTICLE 1.63 	"International Premises" shall mean 
the premises described on Section 1.64 of the Disclosure 
Schedule.
 
ARTICLE 1.64 	"International Receivables" shall mean 
accounts receivable of the International Affiliates relating to 
the Business.
 
ARTICLE 1.65 	"Know-how" shall mean all product 
specifications, processes, product designs, plans, ideas, 
concepts, manufacturing, engineering and other manuals and 
drawings, technical information, data, research records, all 
promotional literature, customer and supplier lists and similar 
data and information, and all other confidential or proprietary 
technical and business information which is either (i) owned by 
the Companies or (ii) owned by Sellers or the International 
Affiliates and used exclusively in connection with the Business.
 
ARTICLE 1.66 	"Leased Real Property" shall mean all 
real property leased by the Companies, including any buildings, 
structures, fixtures and improvements thereon or appurtenances 
thereto.
 
ARTICLE 1.67 	"License Agreement" shall mean that 
certain license agreement between Buyer and Sellers, 
substantially in the form of Exhibit C hereto.
 
ARTICLE 1.68 	"Material Adverse Change" shall mean a 
change that has had a Material Adverse Effect.
 
ARTICLE 1.69 	"Material Adverse Effect" shall mean 
any effect which would reasonably be expected to have a material 
adverse effect on the assets, business, operations or financial 
condition of the Business. 
 
ARTICLE 1.70 	"Minimum Loss" shall have the meaning 
set forth in Section 11.3.
 
ARTICLE 1.71 	"Multiemployer Plan" means each U.S. 
Employee Plan that is a multiemployer plan, as defined in Section 
3(37) of ERISA.
 
ARTICLE 1.72 	"Net Assets" shall mean the Assets and 
the total assets of the Companies (excluding the Excluded 
Assets), minus the sum of the Assumed Liabilities and the total 
liabilities of the Companies (excluding the Excluded 
Liabilities).
 
ARTICLE 1.73 	"Net Receivables" shall mean the net 
amount of the International Receivables and International 
Payables and Pharmaceutical Receivables and Pharmaceutical 
Payables.
 
ARTICLE 1.74 	"Net Sales" equals gross sales less 
returns, cash discounts, temporary price reductions, chargebacks, 
rebates and price adjustments.
 
ARTICLE 1.75 	"Operating Profit" shall mean the 
amount calculated from the line items set forth on the Statements 
of Operating Profit included in the Financial Statements as 
follows:  Net Sales less the sum of the following:  Cost of Goods 
Sold; Marketing; Selling; Storage, Packaging & Shipping; 
Administrative; Research & Development; and General Expense; and 
excluding the following:  amortization of goodwill and incentive 
compensation costs.
 
ARTICLE 1.76 	"Ophthalmics" shall have the meaning 
set forth in the second WHEREAS clause of this Agreement.
 
ARTICLE 1.77 	"Ophthalmic Shares" shall have the 
meaning set forth in Section 4.2.
 
ARTICLE 1.78 	"Owned Real Property" shall mean all 
real property owned by the Companies set forth in Section 4.8.1 
of the Disclosure Schedule hereto, including any buildings, 
structures and improvements thereon or appurtenances thereto.
 
ARTICLE 1.79 	"Patents" shall mean all patents and 
patent applications (including, without limitation, all reissues, 
divisions, continuations, continuations-in-part, renewals and 
extensions of the foregoing) which are either (i) owned by the 
Companies or (ii) owned by Sellers or the International 
Affiliates and used exclusively in connection with the Business.
 
ARTICLE 1.80 	"Pension Plan" means an "employee 
pension benefit plan" (as such term is defined in Section 3(2) 
of ERISA) that is intended to qualify under Section 401(a) of the 
Code and is maintained by any of the Companies or any ERISA 
Affiliate, or to which any of the Companies or any ERISA 
Affiliate is required to contribute, or with respect to which any 
of the Companies or any ERISA Affiliate is or will be required to 
pay any amount.
 
ARTICLE 1.81 	"Permitted Encumbrances" shall have 
the meaning set forth in Section 4.9.1.
 
ARTICLE 1.82 	"Person" shall mean an individual, a 
corporation, a partnership, an association, a trust or other 
entity or organization, including a government or political 
subdivision or an agency or instrumentality thereof.
 
ARTICLE 1.83 	"Pharmaceutical Payables" shall mean 
accounts payable and accruals of Sellers and the Companies 
arising from the manufacture and/or sale of ophthalmic 
pharmaceutical products included in the Business.
 
ARTICLE 1.84 	"Pharmaceutical Receivables" shall 
mean accounts receivable of Sellers and the Companies arising 
from sales of ophthalmic pharmaceutical products included in the 
Business.
 
ARTICLE 1.85 	"Product Development Agreement" means 
an agreement between Sellers and Buyer, or their respective 
Affiliates, relating to product development efforts for different 
formulations of Ocuvite, based on the principal terms set forth 
in Exhibit D.
 
ARTICLE 1.86 	"Purchase Price" shall have the 
meaning set forth in Section 2.1.
 
ARTICLE 1.87 	"Real Property" shall mean the Owned 
Real Property and the Leased Real Property.
 
ARTICLE 1.88 	"Release" shall mean any release, 
spill, emission, leaking, pumping, injection, deposit, disposal, 
discharge, dispersal or leaching of Hazardous Substances into the 
environment.
 
ARTICLE 1.89 	"Research and Discovery Agreement" 
shall mean  an agreement relating to ophthalmic research and 
discovery to be entered into, substantially on the terms set 
forth in Exhibit E hereto.
 
ARTICLE 1.90 	"Section 338(h)(10) Elections" shall 
have the meaning set forth in Section 7.7.5.
 
ARTICLE 1.91 	"Section 338 Taxes" shall mean any 
Taxes that would not have been imposed but for the Section 
338(h)(10) Elections or any elections under state, local or other 
Tax law that are required to be made or deemed to have been made 
as a result of any Section 338(h)(10) Elections.
 
ARTICLE 1.92 	"Securities Act" shall mean the 
Securities Act of 1933, as amended, and the regulations 
thereunder.
 
ARTICLE 1.93 	"Shares" shall mean the Chirurgie 
Shares, Ophthalmics Shares, Storz Shares and Storz GmbH Shares.
 
ARTICLE 1.94 	"Storz" shall have the meaning set 
forth in the second WHEREAS clause of this Agreement.
 
ARTICLE 1.95 	"Storz Employees" shall mean (i) all 
individuals who, on the Closing Date, are actively employed by 
any of the Companies; and (ii) all individuals who are on 
short-term disability leave, authorized leave of absence granted 
prior to the Closing Date in accordance with the terms of the 
Companies' leave policies as in effect as of the date of this 
Agreement or military service or lay-off with recall rights from 
any of the Companies as of the Closing Date.
 
ARTICLE 1.96 	"Storz GmbH" shall mean Storz 
International GmbH, a wholly-owned subsidiary of Storz.
 
ARTICLE 1.97 	"Storz GmbH Employees" shall mean (i) 
all individuals who, on the Closing Date, are actively employed 
by Storz GmbH; and (ii) all individuals who are on short-term 
disability leave, authorized leave of absence in accordance with 
the terms of Storz GmbH's policy as in effect as of the date of 
this Agreement or military service or lay-off with recall rights 
from Storz GmbH as of the Closing Date.
 
ARTICLE 1.98 	"Storz GmbH Plans" shall mean the 
plans and arrangements referenced in Section 9.2.1.
 
ARTICLE 1.99 	"Storz GmbH Shares" shall mean all the 
issued and outstanding shares of capital stock of Storz GmbH.
 
ARTICLE 1.100 	"Storz Shares" shall have the meaning 
set forth in Section 4.2.
 
ARTICLE 1.101 	"Straddle Period" shall mean any 
taxable period beginning before and ending after the Closing 
Date.
 
ARTICLE 1.102 	"Supply Agreement" shall mean the 
supply agreements under which certain products in finished 
packaged form related to the Cyanamid Storz Business and the 
Wyeth Storz Business shall be provided by Sellers or their 
Affiliates to Buyer, and/or its Affiliates, substantially in the 
form of Exhibit F attached hereto.
 
ARTICLE 1.103 	"Tax Affiliate" of a Person shall mean 
any Affiliate of said Person which was included, or includable, 
in a Tax Return in which such Person was included as a member.
 
ARTICLE 1.104 	"Tax Assets" shall mean all assets 
comprising receivables or deferred assets or prepayments for 
Taxes, except Value Added Tax ("VAT") receivables, of the 
Companies for taxable periods (or portions thereof) ending on or 
before the Closing Date.
 
ARTICLE 1.105 	"Tax Liabilities" shall mean all 
liabilities for Taxes imposed on the Companies or otherwise with 
respect to the Business or the Assets, in each case for the 
taxable periods, or portions thereof, ending on or before the 
Closing Date.
 
ARTICLE 1.106 	"Tax Returns" shall mean all reports, 
returns, schedules and any other documents required to be filed 
with respect to Taxes and all claims for refunds of Taxes.
 
ARTICLE 1.107 	"Tax Sharing Arrangement" shall mean 
any written or unwritten agreement or arrangement for the 
allocation or payment of Tax Liabilities or payment for Tax 
benefits with respect to a consolidated, combined or unitary Tax 
Return which Tax Return includes any of the Companies.
 
ARTICLE 1.108 	"Taxes" (and with correlative 
meanings, "Tax" and "Taxable") shall mean all taxes of any 
kind imposed by a federal, state, local or foreign Governmental 
Authority, and any payments made to another party pursuant to a 
Tax Sharing Arrangement, indemnity or other similar arrangement, 
including but not limited to those on, or measured by or referred 
to as income, gross receipts, financial operation, sales, use, ad 
valorem, value added, franchise, profits, license, withholding, 
payroll (including all contributions or premiums pursuant to 
industry or governmental social security laws or pursuant to 
other tax laws and regulations), employment, excise, severance, 
stamp, occupation, premium, property, transfer or windfall 
profits taxes, customs, duties or similar fees, assessments or 
charges of any kind whatsoever, together with any interest and 
any penalties, additions to tax or additional amounts imposed by 
such Governmental Authority with respect to such amounts.
 
ARTICLE 1.109 	"Trademarks" shall mean (i) 
trademarks, service marks, trade names, trade dress, labels, 
logos and all other names and slogans associated with any 
products or services, or embodying associated goodwill, whether 
or not registered, and any applications or registrations therefor 
owned by the Companies and, in the case of Sellers or the 
International Affiliates, are exclusively used in connection with 
the Business.
 
ARTICLE 1.110 	"Transition Services Agreement" shall 
mean the transition services agreement to be entered into between 
Sellers or their Affiliates and Buyer based on the principal 
terms set forth in Exhibit G.
 
ARTICLE 1.111 	"U.S. Benefit Arrangements" shall mean 
the arrangements referenced in the Section 9.1.4.
 
ARTICLE 1.112 	"U.S. Employee Plan" means any plan 
referenced in Section 9.1.1.
 
ARTICLE 1.113 	"Wyeth Storz Assets" shall mean (i) 
Intellectual Property listed in Section 1.114 of the Disclosure 
Schedule, (ii) the rights of AHP under the Wyeth Storz Assumed 
Contracts, (iii) all inventory of finished products (including 
the finished goods inventories of the AHP ophthalmic 
pharmaceutical products described in Section 1.114 of the 
Disclosure Schedule) and other tangible personal property (and 
related promotional and sales materials) held for sale or used 
primarily in connection with the Wyeth Storz Business as of the 
date hereof, together with any additions thereto and subject to 
any reductions therefrom received or incurred in operating the 
Wyeth Storz Business in the ordinary course after the date hereof 
through the Closing Date, (iv) all prepaid expenses as of the 
date hereof, together with any additions thereto and subject to 
any reductions therefrom made or accrued by AHP in operating the 
Wyeth Storz Business in the ordinary course and in compliance 
with Article 6 after the date hereof through the Closing Date, 
(v) sales data, customer lists, information relating to 
customers, suppliers' names, mailing lists, and, if any, 
advertising matter and all rights thereto relating to the Wyeth 
Storz Business, (vi) all transferable Applicable Permits.
 
ARTICLE 1.114 	"Wyeth-Storz Assumed Contracts" shall 
mean the Contracts listed in Section 1.115 of the Disclosure 
Schedule.
 
ARTICLE 1.115 	"Wyeth Storz Business" shall mean the 
business conducted in the United States by AHP and outside the 
United States by the International Affiliates related primarily 
to the manufacture, sale and distribution of the products 
included in the Wyeth Storz Assets.
 
ARTICLE 1.116 	Additional defined terms:
 	
 			Term				                   		Section
 			Andersen					                3.5.1
 			European Employees			        9.5.3(a)
 			Notice of Disagreement		     3.5.2
 			Section 3.5.1 Documents		    3.5.1
 			Third Party Claim			         11.2.1
 			Transfer Provisions 		       9.5.3(b)
 
 		Additional definitions are set forth in Article 9.
 
 
ARTICLE 2 
 	THE ACQUISITION
 
ARTICLE 2.1 	Purchase and Sale.  Upon the terms and 
subject to the conditions of this Agreement, (i) Sellers shall 
(and shall cause the International Affiliates to) sell, assign, 
transfer and deliver to Buyer the Shares and the Assets, and (ii) 
Buyer and/or Affiliates of Buyer shall purchase and accept the 
Shares and the Assets from Sellers and the International 
Affiliates, subject to the Assumed Liabilities, for an aggregate 
purchase price of THREE HUNDRED EIGHTY MILLION DOLLARS 
($380,000,000), payable at Closing, subject to adjustment as 
provided in Section 3.6 (the price as so adjusted, together with 
the Assumed Liabilities, is herein called the "Purchase 
Price").
 
ARTICLE 2.2 	Assumption of Liabilities.  Pursuant to 
assumption agreements to be executed and delivered in accordance 
with Section 3.2(j), Buyer and/or Affiliates of Buyer will assume 
at the Closing and subsequently, in due course, pay, honor and 
discharge all of the Assumed Liabilities.
 
 
ARTICLE 3 
 	CLOSING; PURCHASE PRICE ADJUSTMENT
 
ARTICLE 3.1 	The Closing.  Unless this Agreement 
shall have been terminated, on the terms and subject to the 
conditions of this Agreement, the closing of the sale and 
purchase of the Shares and the Assets and the consummation of the 
other transactions contemplated hereby (the "Closing") shall 
take place at the New York City offices of Buyer's counsel, 
O'Melveny & Meyers on the later of December 15, 1997 or the next 
succeeding business day on which the last to be fulfilled or 
waived of the conditions set forth in Article 8 shall be 
fulfilled or waived in accordance with this Agreement or at such 
other time, date or place as the parties may mutually agree upon 
in writing (the "Closing Date").  At the Closing, the parties 
to this Agreement will exchange funds, certificates and other 
documents specified in this Agreement.  For purposes of this 
Agreement the Closing will be treated as if it occurred at 11:59 
P.M. on the Closing Date.
 
ARTICLE 3.2 	Deliveries by Buyer.  At the Closing, 
Buyer shall deliver, or cause to be delivered, to Sellers the 
following:
 
 		(a)	the amount of the Purchase Price specified in 
Section 2.1 to be paid at Closing, payable by wire transfer of 
immediately available funds on the Closing Date to an account 
specified in writing by Sellers, such notice to be delivered no 
less than two business days prior to the Closing Date.
 
 		(b)	the certificate by an officer of Buyer required to 
be delivered pursuant to Section 8.2.3;
 
 		(c)	a certificate, signed by an authorized officer of 
Buyer, certifying as to (i) the due organization and good 
standing of Buyer, (ii)the corporate resolutions of Buyer 
authorizing the transactions contemplated by this Agreement, and 
(iii) the incumbency of officers of Buyer executing this 
Agreement and the other agreements, instruments or certificates 
delivered at or prior to the Closing;
 
 		(d)	the Transition Services Agreements, duly executed 
by Buyer and/or any Affiliates of Buyer;
 
 		(e)	the Supply Agreements, duly executed by Buyer 
and/or any Affiliates of Buyer;
 	
 		(f)	the Research and Discovery Agreement, duly 
executed by Buyer and/or an Affiliate of Buyer;
 	
 		(g)	the Diamox, Neptazane and Phospholine Iodide Co-
Promotion Agreement duly executed by Buyer and/or any Affiliates 
of Buyer;
 
 		(h)	the Cidofovir Co-Marketing Agreement, duly 
executed by Buyer and/or an Affiliate of Buyer;
 
 		(i)	 the License Agreement, duly executed by Buyer 
and/or an Affiliate of Buyer;
 
 		(j)	the Product Development Agreement, duly executed 
by Buyer and/or an Affiliate of Buyer;
 
 		(k)	such instruments of assumption and other 
certificates, instruments or documents, in form and substance 
reasonably acceptable to Sellers, as may be necessary to effect 
Buyer's assumption under Applicable Laws of the Assumed 
Liabilities; and
 
 		(l)	such other instruments and documents, in form and 
substance reasonably acceptable to Sellers, as may be necessary 
to effect the Closing.
 
ARTICLE 3.3 	Deliveries by Sellers.  At the Closing, 
Sellers shall deliver, or cause to be delivered by the 
International Affiliates, to Buyer and any Affiliates designated 
by Buyer the following:
 
 		(a)	certificate(s) representing the Shares duly 
endorsed for transfer to Buyer or accompanied by stock powers 
duly executed in blank;
 
 		(b)	the certificate by officers of Sellers required to 
be delivered pursuant to Section 8.3.3;
 
 		(c)	a certificate, signed by an authorized officer of 
each of Sellers, certifying as to (i) the due organization and 
good standing of each Seller, (ii) the corporate resolutions of 
each Seller authorizing the transactions contemplated by this 
Agreement, and (iii) the incumbency of officers of each Seller 
executing this Agreement and the other agreements, instruments or 
certificates delivered at or prior to the Closing;
 
 		(d)	the stock books, stock ledgers, minute books and 
corporate seals of the Companies;
 
 		(e)	the Transition Services Agreements, duly executed 
by Cyanamid, AHP or their Affiliates;
 
 		(f)	the Supply Agreements, duly executed by Cyanamid, 
AHP or their Affiliates;
 
 		(g)	the Research and Discovery Agreement, duly 
executed by a Seller or an Affiliate of Sellers.
 
 		(h)	the Diamox, Neptazane and Phospholine Iodide Co-
Promotion Agreement, duly executed by a Seller and/or an 
Affiliates of Sellers;
 
 		(i)	the Cidofovir Co-Marketing Agreement, duly 
executed by a Seller and/or an Affiliate of Sellers;
 
 		(j)	the License Agreement, duly executed by a Seller 
and/or an Affiliate of Sellers;
 	
 		(k)	the Product Development Agreement duly executed by 
a Seller and/or an Affiliate of Sellers;
 
 		(l)	bills of sale and any other appropriate 
instruments of sale and conveyance, in form and substance 
reasonably acceptable to Buyer, transferring to Buyer or its 
Affiliates under Applicable Laws all tangible personal property 
included in the Assets, including Books and Records;
 
 		(m)	bills of sale and any other appropriate 
instruments of sale and conveyance, in form and substance 
reasonably acceptable to Buyer, transferring to Buyer or its 
Affiliates under Applicable Laws all Intellectual Property 
included within the Assets (Buyer, at its own expense, shall 
prepare any and all individual assignment documents required in 
the respective countries and shall record them in the national 
patent and trademark and other government offices, as 
applicable);
 
 		(n)	assignments or, where necessary, subleases, in 
form and substance reasonably acceptable to Buyer, assigning or 
subleasing to Buyer or its Affiliates under Applicable Laws all 
Assumed Contracts and transferable Applicable Permits;
 
 		(o)	such instruments of cancellation and other 
appropriate documents, in form and substance reasonably 
acceptable to Buyer, cancelling all loans or other obligations 
for borrowed money owed by any of the Companies to Sellers or any 
of their Affiliates, duly executed by Sellers or such Affiliates, 
as the case may be;
 
 		(p)	such other instruments and documents, in form and 
substance reasonably acceptable to Buyer and Sellers, as may be 
necessary to effect the Closing; and
 
 		(q)	letters of resignation executed by the directors 
of each of the Companies and such letters executed by officers of 
the Companies as shall be requested by Buyer.
 
ARTICLE 3.4 	Further Assurances.
 
ARTICLE 3.4.1 	From time to time, at Buyer's or 
Sellers' request and in accordance with Section 7.3, whether at 
or after the Closing Date, Buyer or Sellers, as the case may be, 
shall, and shall cause their respective Affiliates to, execute 
and deliver such further instruments of conveyance, transfer and 
assignment, cooperate and assist in providing information for 
making and completing regulatory filings, and take such other 
actions as Buyer or Sellers, as the case may be, may reasonably 
require of the other party to more effectively assign, convey and 
transfer to such party the Shares and the Assets, and to assume 
the Assumed Liabilities, as contemplated by this Agreement.  In 
addition, Buyer shall or shall cause its Affiliates to, upon 
Sellers' request, to execute and deliver appropriate instruments 
of conveyance, transfer and assignment to assign, convey and 
transfer to Sellers' designated Affiliate all right, title and 
interest to the Excluded Assets and any security documentation 
and agreements relating thereto.
 
ARTICLE 3.4.2 	To the extent that the assignment of any 
Assumed Contract or other Asset to Buyer hereunder shall require 
the consent of the other party thereto, this Agreement shall not 
constitute an agreement to assign the same if an attempted 
assignment would constitute a breach thereof.  Sellers will use 
their diligent efforts to obtain the consent of the other parties 
to such Assumed Contracts for the assignment thereof to Buyer, 
provided, however, that Sellers shall not be obligated to make 
any payment or take any other detrimental action to obtain any 
such consent.  If any such consent is not obtained, Sellers 
shall, and shall cause their Affiliates to, cooperate with Buyer 
in any arrangement reasonably requested by Buyer to provide for 
Buyer the benefits under any such Contract, including the 
enforcement at the cost of and for the benefit of Buyer of any 
and all rights thereunder of Sellers or their respective 
Affiliates against the other party thereto.
 
ARTICLE 3.4.3 	If any Applicable Permit is 
nontransferable, following the date hereof Sellers shall, and 
shall cause their Affiliates to, reasonably cooperate with Buyer 
and its Affiliates in connection with Buyer's and its Affiliates' 
efforts to obtain any such Applicable Permit in its or their own 
names.  If Buyer and its Affiliates are unsuccessful in obtaining 
any such Applicable Permit at or prior to the Closing, the 
Sellers or the International Affiliates will provide, at Buyer's 
cost, interim services for Buyer's account for such period as may 
reasonably be necessary to allow Buyer and its Affiliates to 
secure such Applicable Permit in its or their own names to the 
extent practicable and upon reasonable terms and conditions.  In 
the event any Applicable Permit (including product registrations) 
is not obtained by the Closing Date, Sellers shall, and shall 
cause their Affiliates to, cooperate with Buyer in any 
arrangement reasonably requested by Buyer to provide for Buyer 
the benefits under any such Applicable Permit (including product 
registrations) under the terms of the Transaction Services 
Agreement.
 
ARTICLE 3.4.4   Any returns of consigned inventory 
received by Sellers or the International Affiliates shall be 
promptly forwarded to Buyer.  To the extent International 
Affiliates receive payments specifically designated as payment 
for purchases made from Buyer or its Affiliates after the 
Closing, the International Affiliates will promptly forward such 
payments to Buyer.
 
ARTICLE 3.5 	Closing Statement.
 
ARTICLE 3.5.1 	As promptly as practicable, but no later 
than 90 days after the Closing Date, Sellers, at their own 
expense, will cause to be prepared in accordance with GAAP, 
applied on a basis which is consistent with the preparation of 
the Financial Statements, and shall deliver to Buyer a combined 
adjusted statement, together with notes thereto, of the Net 
Assets (which shall include any cash remaining in any of the 
Companies on the Closing Date) as of the close of business on the 
Closing Date (the "Closing Statement"), including a schedule 
based on such Closing Statement setting forth Sellers' 
calculation of the value of the Net Assets as of the Closing Date 
(the "Closing Net Asset Value") which statement will indicate, 
but not include, the Net Receivables as of the Closing Date; 
provided, however, that for purposes of calculating the Closing 
Net Asset Value, such calculation shall include reserves 
calculated in a manner consistent with the manner used in 
calculating such reserves in the Statement of Net Assets as of 
December 31, 1996 included in the Financial Statements.  The 
Closing Statement shall include line items and notes 
substantially consistent with those of the audited statements of 
Net Assets included in the Financial Statements except for the 
exclusion of the Net Receivables.  Buyer, at its own expense, 
shall cause the Companies and Buyer's Affiliates and their 
respective employees to assist Sellers in the preparation of the 
Closing Statement and shall provide Sellers and their independent 
auditors, Arthur Andersen LLP ("Andersen"), access at all 
reasonable times to the personnel, properties, books and records 
of the Companies for such purpose.  The Closing Statement shall 
be accompanied by an audit report from Andersen stating that in 
its opinion the Closing Statement presents fairly, in all 
material respects, the Net Assets and the Net Receivables as of 
the Closing Date in conformity with GAAP and pursuant to the 
terms of this Agreement, applied on a basis which is consistent 
with the preparation of the Financial Statements.  The Closing 
Statement and the accompanying audit report are collectively 
referred to as the "Section 3.5.1 Documents".
 
ARTICLE 3.5.2 	If Buyer disagrees with Sellers' 
calculation of Closing Net Asset Value contained in the Section 
3.5.1 Documents, Buyer may, within 30 days after delivery of the 
Section 3.5.1 Documents, deliver a notice to Sellers disagreeing 
with such calculation and setting forth Buyer's calculation of 
such amount ("Notice of Disagreement").  Any such Notice of 
Disagreement shall specify those items or amounts as to which 
Buyer disagrees, and Buyer shall be deemed to have agreed with 
all other items and amounts contained in the Section 3.5.1 
Documents.
 
ARTICLE 3.5.3 	If a Notice of Disagreement shall be 
duly and timely delivered pursuant to Section 3.5.2, the parties 
shall, during the 30 days following such delivery, use their 
diligent efforts to reach agreement on the disputed items or 
amounts in order to determine, as may be required, the amount of 
Closing Net Asset Value, which amount shall not be more than the 
amount thereof shown in the Section 3.5.1 Documents nor less than 
the amount thereof shown in the Notice of Disagreement.  If, 
during such period, the parties are unable to reach agreement, 
they shall promptly thereafter cause a mutually acceptable firm 
of nationally recognized independent public accountants (the 
"Accountant") promptly to review this Agreement, the 
appropriate books and records relating to the Business and the 
Assets and the disputed items or amounts for the purpose of 
calculating Closing Net Asset Value.  In making such calculation, 
the Accountant shall consider only those items or amounts in the 
Closing Statement or Sellers' calculation of Closing Net Asset 
Value as to which Buyer has disagreed.  The Accountant shall 
deliver to Sellers and Buyer, as promptly as practicable, a 
report setting forth such calculation.  Such report shall be 
final and binding upon the parties hereto.  The cost of such 
review and report shall be borne (i) by the party whose 
calculation or calculations, taken together, were furthest from 
that of the Accountant, or (ii) otherwise equally by Sellers and 
Buyer.  "Final Net Asset Value" means (A) Closing Net Asset 
Value as shown in Sellers' calculation delivered pursuant to 
Section 3.5.1 if no Notice of Disagreement with respect thereto 
is duly and timely delivered, (B) the amount agreed upon by the 
parties pursuant to this Section 3.5.3, or (C) in the absence of 
such agreement, the amount as shown in the Accountant's 
calculation delivered pursuant to this Section 3.5.3; provided 
that Final Net Asset Value shall not in any event be more than 
Sellers' calculation delivered pursuant to Section 3.5.1 nor less 
than Buyer's calculation pursuant to Section 3.5.2.
 
ARTICLE 3.6 	Adjustment of Purchase Price.
 
ARTICLE 3.6.1 	If the amount of $73,192,000 ("Base Net 
Asset Value") exceeds the Final Net Asset Value, Sellers shall 
pay to Buyer, as an adjustment to the Purchase Price, in the 
manner and with interest as provided in Section 3.6.2, the amount 
of such excess.  If Final Net Asset Value exceeds Base Net Asset 
Value, Buyer shall pay to Sellers, in the manner and with 
interest as provided in Section 3.6.2, the amount of such excess. 
 Any such payment pursuant to this Section 3.6.1 shall be made 
(i) within 30 days after Sellers' delivery of the Section 3.5.1 
Documents if no Notice of Disagreement with respect to Closing 
Net Asset Value is duly and timely delivered pursuant to Section 
3.5.2 or (ii) if a Notice of Disagreement with respect to Closing 
Net Asset Value is duly and timely delivered pursuant to Section 
3.5.2, then within 10 days after the earlier of (A) agreement 
between the parties pursuant to Section 3.5.3 with respect to 
Closing Net Asset Value or (B) delivery of the Accountant's 
calculation of Final Net Asset Value pursuant to Section 3.5.3.
 
ARTICLE 3.6.2 	Any payment made pursuant to this 
Section 3.6 shall be made by wire transfer or by delivery to the 
payee of the required amount in immediately available funds to 
such account as the payee shall have designated for such purpose 
at least two days prior to the date of the required payment (or, 
if not so designated, by certified or official bank check payable 
in immediately available funds to the order of the payee in such 
amount).  The amount to be paid under this Section shall bear 
interest from and including the date immediately preceding the 
Closing Date to the date of payment at a rate per annum equal to 
the rate publicly announced by Chase Manhattan Bank (or its 
successor) in New York, New York as its prime rate in effect on 
the Closing Date.  Interest shall be calculated daily on the 
basis of a year of 365 days and the actual number of days for 
which interest is due.
 
 
ARTICLE 4 
 	REPRESENTATIONS AND WARRANTIES
 	OF SELLERS
 
 		Sellers hereby jointly and severally represent and 
warrant to Buyer as follows:
 
ARTICLE 4.1 	Organization, Good Standing, Power, Etc.
 
ARTICLE 4.1.1 	Each of the Companies is a corporation 
duly organized, validly existing and in good standing under the 
laws of the jurisdiction of its incorporation.  Each of the 
Companies has the requisite corporate power and authority to own, 
operate or lease the properties that it purports to own, operate 
or lease and to carry on its business as it is now being 
conducted and is duly licensed or qualified as a foreign 
corporation in each domestic or foreign jurisdiction in which the 
nature of the business conducted by it or the character or 
location of the properties owned or leased by it makes such 
licensing or qualification necessary, except where the failure to 
be so licensed or qualified would not reasonably be expected to 
result in a Cost in excess of $200,000.  Copies of (i) the 
certificate of incorporation and by-laws (or similar charter 
documents) of each of the Companies including all amendments 
thereto, (ii) the minute books of each of the Companies and (iii) 
the stock transfer books of each of the Companies, heretofore 
delivered, furnished or made available to Buyer or its 
representatives by Sellers, are true and complete as of the date 
hereof (except in the case of the minute books, which are true 
and complete in all material respects).  The certificate of 
incorporation and by-laws (or similar charter documents) of each 
of the Companies is in full force and effect, and none of the 
Companies is in violation or breach of any of the provisions of 
its certificate of incorporation or by-laws (or similar charter 
documents) in any material respect.
 
ARTICLE 4.1.2 	Each of Sellers is a corporation duly 
organized, validly existing and in good standing under the laws 
of the state of its incorporation.  Each of Sellers has the 
requisite corporate power and authority to execute and deliver 
this Agreement, and Sellers and the International Affiliates have 
all requisite corporate power and authority to execute and 
deliver the other agreements contemplated hereby and to 
consummate the transactions contemplated hereby and thereby.  The 
execution and delivery of this Agreement by Sellers, the 
execution and delivery by Sellers or the International Affiliates 
of the other agreements contemplated hereby, and the consummation 
by Sellers and the International Affiliates of the transactions 
contemplated hereby and thereby have been duly authorized by all 
necessary corporate action on the part of Sellers and the 
International Affiliates and no other or further corporate 
proceedings will be necessary for the execution and delivery of 
such agreements by Sellers and the International Affiliates, the 
performance by Sellers and the International Affiliates of their 
obligations hereunder and thereunder and the consummation by 
Sellers and the International Affiliates of the transactions 
contemplated hereby and thereby.  This Agreement has been duly 
executed and delivered by each of Sellers and constitutes a 
legal, valid and binding obligation of each of Sellers 
enforceable against Sellers in accordance with its terms, except 
as the same may be limited by bankruptcy, insolvency, moratorium, 
reorganization or other laws of general applicability relating to 
or affecting the enforcement of creditors' rights and general 
principles of equity.
 
ARTICLE 4.2 	Capitalization of the Companies.  As of the 
date of this Agreement, the authorized capital stock of (i) Storz 
consists of 20,000 shares of Common Stock, $100 par value per 
share (the "Storz Shares"), all of which Storz Shares are 
validly issued and outstanding, fully paid and non-assessable  
(ii) Ophthalmics consists of 1,000 shares of Common Stock, $1.00 
par value per share, only of which 10 shares (the "Ophthalmics 
Shares") are validly issued and outstanding, fully paid and non-
assessable, and (iii) Chirurgie consists of 8,000 shares of 
Ordinary Stock, 100ff par value per share, all of which Chirurgie 
Shares are validly issued and outstanding, fully paid and non-
assessable.
 
ARTICLE 4.2.1 	There are no options, warrants or other 
rights, agreements, arrangements or commitments of any character 
obligating any of the Companies to issue or sell any shares of 
capital stock of or other equity interests in any of the 
Companies, or any securities or obligations convertible into or 
exchangeable for any shares of capital stock of any of the 
Companies or other equity interests in any of the Companies 
obligating any of the Companies to grant, extend or enter into 
any such right, agreement, arrangement or commitment.
 
ARTICLE 4.2.2 	There are no outstanding contractual 
obligations of any of the Companies to repurchase, redeem or 
otherwise acquire any outstanding shares of capital stock of, or 
other ownership interests in, any of the Companies, or to make 
any investment (in the form of a loan, capital contribution or 
otherwise) in any other entity.
 
ARTICLE 4.2.3 	Cyanamid is the record and beneficial 
owner of the Storz Shares and the Ophthalmic Shares, and has 
good, valid and marketable title to all of the respective Shares 
free and clear of any Encumbrances and any preemptive or 
subscription rights of any Person.  There are no restrictions 
with respect to the transferability of the Shares except as 
provided by Applicable Law.
 
ARTICLE 4.3 	Subsidiaries.  Storz is the record and 
beneficial owner of all the Storz GmbH Shares, free and clear of 
any Encumbrances and any preemptive or subscription rights of any 
Person.  Other than with respect to the matters set forth in 
Section 4.3 of the Disclosure Schedule, and other than with 
respect to Storz GmbH (it being understood that all such 
interests shall be transferred out of the Companies prior to 
Closing), none of the Companies own any interest in any 
corporation and neither Company is a participant or owns an 
interest in any partnership or any joint venture with any third 
party.  Wyeth Nutrition (1 Share) and Wyeth-Lederle (7,999 
Shares) are collectively the record and beneficial owner, and AHP 
is the indirect beneficial owner, of all the Chirurgie Shares, 
free and clear of any Encumbrances and any preemptive or 
subscription rights of any Person.
 
ARTICLE 4.3.1 	There are no options, warrants or other 
rights, agreements, arrangements or commitments of any character 
obligating either Chirurgie or Storz GmbH to issue or sell any 
shares of capital stock of or other equity interests in either 
Chirurgie or Storz GmbH, or any securities or obligations 
convertible into or exchangeable for any shares of capital stock 
of either Chirurgie or Storz GmbH or other equity interests in 
either Chirurgie or Storz GmbH obligating Chirurgie or Storz GmbH 
to grant, extend or enter into any such right, agreement, 
arrangement or commitment.
 
ARTICLE 4.3.2 	There are no outstanding contractual 
obligations of either Chirurgie or Storz GmbH to repurchase, 
redeem or otherwise acquire any outstanding shares of capital 
stock of, or other ownership interests in, either Chirurgie or 
Storz GmbH, or to make any investment (in the form of a loan, 
capital contribution or otherwise) in any other entity.
 
ARTICLE 4.4 	Effect of Agreement.  The execution, 
delivery and performance by Sellers of this Agreement and the 
execution, delivery and performance by Sellers and the 
International Affiliates of the other agreements contemplated 
hereby and the consummation by Sellers and the International 
Affiliates of the transactions contemplated hereby and thereby 
will not require any notice to, filing with, or the consent, 
approval or authorization of, any person or Governmental 
Authority, except as contemplated in Section 7.5 hereof or as set 
forth in Section 4.4 of the Disclosure Schedule, other than where 
the failure to obtain such consent, approval or authorization, or 
to give or make any such notice or filing, would not reasonably 
be expected to have a Cost in excess of $200,000.  Except as 
contemplated in Section 7.5 hereof or as set forth in Section 4.4 
of the Disclosure Schedule, neither the execution and delivery of 
this Agreement or of the other agreements contemplated hereby nor 
the consummation of the transactions contemplated hereby or 
thereby will (i) violate or result in a breach or result in the 
acceleration or termination of, or the creation in any third 
party of the right to accelerate, terminate, modify or cancel, 
any Contract material to the Business, (ii) conflict with, 
violate or result in a breach of any provision of the 
incorporation documents or by-laws of either of Sellers or any of 
the Companies, or any similar corporate documents of the 
International Affiliates in any material respect, or (iii) 
conflict with or violate any Applicable Laws or court orders in 
any material respect.
 
ARTICLE 4.5 	Financial Statements and Net Asset Value.
 
ARTICLE 4.5.1 	Sellers will deliver the financial 
statement set forth in clause (i) below as soon as it becomes 
available but in no event later than November 15, 1997 and 
Sellers have delivered to Buyer or its representatives the 
financial statements set forth in clause (ii) below (the 
"Financial Statements"): (i) an audited combined adjusted 
statement of Operating Profit for the year ended December 31, 
1996 which includes the results derived from the Business for 
such period and a combined adjusted statement of Net Assets as of 
December 31, 1996 (including notes thereto) indicating (but not 
including) the Net Receivables as of such date, which combined 
adjusted statement contains a report from Andersen reporting 
thereon; and (ii) an unaudited combined adjusted statement of 
Operating Profit for the six months ended June 30, 1997, which 
includes the results derived from the Business for such period 
and a combined adjusted statement of Net Assets as of June 30, 
1997 including the Net Receivables as of such date, each prepared 
consistently with the December 31, 1996 Financial Statements 
(except for the inclusion, rather than indication of the Net 
Receivables in the Statement of Net Assets as of June 30, 1997), 
copies of all of which are and will be when delivered attached 
hereto as Section 4.5.1(a) of the Disclosure Schedule.
 
ARTICLE 4.5.2 	When delivered, the Financial Statements 
will (i) have been prepared from the books and records of 
Sellers, the Companies and the International Affiliates, (ii) 
except as set forth in Section 4.5.2 of the Disclosure Schedule 
and in the Financial Statements (including the notes thereto), 
have been prepared in accordance with GAAP and contain sufficient 
supporting disclosures as required to make the information 
presented not misleading, and accurately reflect, in all material 
respects, the Operating Profit for the 1996 year and the six 
months ended June 30, 1997, respectively, and the Net Assets and 
Net Receivables as of December 31, 1996 and June 30, 1997, 
respectively.
 
ARTICLE 4.6 	Absence of Certain Changes or Events.  
Except (i) to the extent arising out of or relating to the 
transactions contemplated by this Agreement (ii) for Contracts 
entered into since June 30, 1997 that are included in the 
Contracts listed on Schedule 4.10(i) of the Disclosure Schedule, 
and (iii) for matters listed on Section 4.6 of the Disclosure 
Schedule, since June 30, 1997 (A) the Business has been operated 
in the ordinary course in a manner consistent with past practice, 
(B) there has not been any Material Adverse Change, (C) to the 
knowledge of Sellers, no change has occurred which would 
reasonably be expected to result in a Material Adverse Change, 
(D) there has not been any agreement, condition, action or 
omission which would be proscribed by (or require consent under) 
6.1.4 had it existed, occurred or arisen after the date of this 
Agreement, (E) there has not been any strike or other labor 
dispute, and (F) there has not been any casualty, loss, damage or 
destruction (whether or not covered by insurance) of any of the 
Assets or assets of the Companies which would reasonably be 
expected to have a Material Adverse Effect.
 
ARTICLE 4.7 	Taxes.
 
ARTICLE 4.7.1 	Except as disclosed on Section 4.7 of 
the Disclosure Schedule, (i) the Companies have filed on or 
before the date hereof (or will timely file) all Tax Returns 
required to be filed for tax years or periods ending on or before 
the Closing Date; (ii) except where failure to pay would not have 
a Material Adverse Effect, all such Tax Returns are (or will be) 
complete and accurate and disclose (or will disclose) all Taxes 
required to be paid by the Companies for the periods covered 
thereby and all Taxes shown to be due on such Tax Returns have 
been (or will be) timely paid; (iii) except where failure to pay 
would not have a Material Adverse Effect, all Taxes (whether or 
not shown on any Tax Return) owed by the Companies and required 
to be paid with respect to tax years or periods ending on or 
before the Closing Date have been (or will be) timely paid or are 
being presently contested in good faith; (iv) none of the 
Companies or any of their Tax Affiliates have waived or been 
requested to waive any statute of limitations in respect of 
Taxes; (v) the income Tax Returns referred to in clause (i) have 
been examined by the Internal Revenue Service or the appropriate 
state, local or foreign taxing authority or the period for 
assessment of the Taxes in respect of which such Tax Returns were 
required to be filed has expired; (vi) there is no action, suit, 
investigation, audit, claim or assessment pending or proposed or 
threatened with respect to Taxes of the Companies; (vii) all 
deficiencies asserted or assessments made as a result of any 
examination of the Tax Returns referred to in clause (i) have 
been paid in full; (viii) all Tax Sharing Arrangements and Tax 
indemnity arrangements will terminate on or prior to the Closing 
Date and the Companies will have no liability thereunder on or 
after the Closing Date; (ix) there are no liens for Taxes upon 
any of the assets of the Companies or the Assets except liens 
relating to current Taxes not yet due; (x) no intercompany 
obligation (as described in Prop. Treas. Reg. Section 1.1502-13(g)) of 
the Companies or any Tax Affiliate will remain outstanding 
following the Closing; and (xi) the Companies have no corporate 
acquisition indebtedness, as described in Section 279(b) of the 
Code.
 
ARTICLE 4.7.2 	No transaction contemplated by this 
Agreement is subject to withholding under Section 1445 of the 
Code.
 
ARTICLE 4.7.3 	As a result of the transactions 
contemplated by this Agreement, neither the Companies nor Buyer 
will be obligated to make a payment to an individual that would 
be an "excess parachute payment" to a "disqualified 
individual" as those terms are defined in Section 280G of the 
Code.
 
ARTICLE 4.7.4 	None of the Companies is, or will be as 
of the Closing, a "consenting corporation" within the meaning 
of Section 341(f) of the Code.
 
ARTICLE 4.8 	Real Property.
 
ARTICLE 4.8.1 	Owned Real Property.  Section 4.8 of the 
Disclosure Schedule sets forth a list of all Owned Real Property. 
 Except as set forth on Section 4.8.1 of the Disclosure Schedule 
and except for Permitted Encumbrances, (i) the Companies have 
good, valid and marketable fee simple title to each parcel of 
Owned Real Property and (ii) none of the Owned Real Property is 
subject to any lease.
 
ARTICLE 4.8.2 	Leased Real Property.  Section 4.8.2 of 
the Disclosure Schedule sets forth a list of all Leased Real 
Property.  The Companies have a valid and binding leasehold 
interest in all Leased Real Property and an International 
Affiliate has a valid leasehold interest in each parcel included 
in the International Premises and each of such leases is in full 
force and effect in accordance with its terms and there exists no 
material breach or default thereunder on the part of any of the 
Companies or their Affiliates or, to the knowledge of Sellers, 
any other party thereto.
 
ARTICLE 4.9 	Good Title To and Condition of Assets; 
Conduct of Business.
 
ARTICLE 4.9.1 	The Companies have good title to, or a 
valid and binding leasehold interest in, the assets of the 
Companies and AHP, Cyanamid and the International Affiliates, 
respectively, have good title to, or a valid and binding 
leasehold interest in, the Wyeth Storz Assets, the Cyanamid Storz 
Assets and the International Assets, respectively (other than 
Real Property and Intellectual Property which are addressed in 
Section 4.8 and 4.11, respectively), in each case free and clear 
of all Encumbrances, except (i) as set forth in Section 4.9.1 of 
the Disclosure Schedule, (ii) any Encumbrances disclosed in the 
Financial Statements, (iii) liens for Taxes, assessments and 
other governmental charges not yet due and payable, (iv) 
immaterial mechanics', workmen's, repairmen's, warehousemen's, 
carriers' or other like liens arising or incurred in the ordinary 
course of business, and equipment leases with third parties 
entered into in the ordinary course of business, (v) with respect 
to Real Property, (A) easements, quasi-easements, licenses, 
covenants, rights-of-way, and other similar restrictions, 
including without limitation any other agreements, conditions or 
restrictions, in each case, which are a matter of public record, 
(B) any conditions that are shown by a current survey (which has 
been made available for Buyer's review prior to the date hereof) 
or physical inspection and (C) zoning, building and other similar 
restrictions pursuant to Applicable Laws and (vi) other 
Encumbrances which, individually or in the aggregate, are not 
material and would not be required to be disclosed or reflected 
on a consolidated balance sheet of the Companies and, with 
respect to the Assets, Sellers and International Affiliates, 
prepared in accordance with GAAP (all items included in (i) 
through (vi) are referred to collectively herein as the 
"Permitted Encumbrances").
 
ARTICLE 4.9.2 	The physical assets of the Companies and 
the Assets taken as a whole are in good and serviceable condition 
(subject to normal wear and tear and immaterial impairments of 
value and damage) and are generally suitable for the uses for 
which they are intended.  Except as set forth in Section 4.9.2 of 
the Disclosure Schedule, and except for the Excluded Assets, the 
Assets, together with all assets owned by the Companies (other 
than Intellectual Property which is addressed in Section 4.11), 
constitute all of the assets necessary to conduct the Business 
consistent with past practice.
 
ARTICLE 4.10 	Contracts.  Section 4.10(i) of the 
Disclosure Schedule sets forth a list, as of the date hereof, of 
each Contract other than (i) purchase orders in the usual and 
ordinary course of business and (ii) any Contract involving the 
payment of less than $300,000 or terminable by any of the 
Companies or by the respective Seller or International Affiliate 
without material penalty upon not more than 60 days' notice.  
Except as set forth in Section 4.10(ii) of the Disclosure 
Schedule, each Contract listed in Section 4.10(i) of the 
Disclosure Schedule or Section 4.11.1 of the Disclosure Schedule 
is a valid and binding agreement and  is in full force and 
effect.  Except as otherwise provided in Section 4.10(iii) of the 
Disclosure Schedule, neither Sellers, the International 
Affiliates nor the Companies are in default, and to Sellers' 
knowledge there is no default by the other party, under any 
Contract listed in Section 4.10(i) of the Disclosure Schedule 
which default has not been cured or waived, except for such 
defaults as would not reasonably be expected to have a Cost in 
excess of $200,000.  Except as described on Section 4.10(iv) of 
the Disclosure Schedule, to the knowledge of Sellers, there is no 
event or circumstance which, with the passage of time or the 
giving of notice or both, would constitute a material default or 
breach by any of the Companies, Sellers or International 
Affiliates that is a party thereto under any of the Contracts 
listed on Section 4.10(i) of the Disclosure Schedule or would 
give rise to any right of termination or acceleration thereunder 
except for such default, breach, termination or acceleration as 
would not reasonably be expected to have a Cost in excess of 
$200,000.  To the knowledge of Sellers, there is no assertion by 
any third party of any claim of material default or breach under 
any of the Contracts except for such claim as would not 
reasonably be expected to have a Cost in excess of $200,000.
 
ARTICLE 4.11 	Intellectual Property Rights.
 
ARTICLE 4.11.1 	Section 4.11.1 of the Disclosure 
Schedule sets forth a listing of (i) all Patents, registered 
Trademarks and applications therefor, registered copyrights and 
applications for copyright registration, industrial and utility 
model registrations and applications therefor, and design 
registrations and applications therefor, included in the 
Intellectual Property, (ii) all Contracts under which any of the 
Companies or any of their Affiliates is licensed or otherwise 
uses or is permitted to use Intellectual Property which is 
material to the Business, (iii) all Contracts under which any of 
the Companies or any of their Affiliates licenses or otherwise 
permits any party to use Intellectual Property; provided, however 
that except as set forth in Section 7.9, the right to use 
"American Home" or "Cyanamid" or anything imitative thereof 
or anything confusingly similar thereto are prohibited and such 
assets are expressly excluded from the purchase and sale 
hereunder.  Except as set forth in Section 4.11.1, of the 
Disclosure Schedule or as provided in the preceding clause or for 
the terms contemplated or set forth in the Supply Agreements, the 
Intellectual Property consists of all such rights required to 
conduct the Business consistent with past practice.
 
ARTICLE 4.11.2 	To the knowledge of Sellers, except as 
set forth in Section 4.11.2 of the Disclosure Schedule, (i) no 
person has claimed that the conduct of the Business as currently 
conducted infringes on or otherwise violates the intellectual 
property rights of any other Person, (ii) no Person is 
challenging or infringing or otherwise violating the Intellectual 
Property, (iii) there are no agreements, written or oral, consent 
decrees or settlement arrangements that would limit or restrict 
Buyer's or its Affiliates' use of the Intellectual Property in 
the operation of the Business except, in each case, for 
challenges, infringements or violations that would be not 
reasonably expected to have a Material Adverse Effect, and (iv) 
to the knowledge of Sellers, none of Sellers, the International 
Affiliates nor the Companies have engaged in any conduct with 
respect to the Business that would reasonably be expected to 
provide any third party with a valid claim of infringement of 
Intellectual Property against the Companies or, with respect to 
the Assets, Sellers or the International Affiliates.
 
ARTICLE 4.11.3 	Except as disclosed on Section 4.11.3 of 
the Disclosure Schedule, the Companies, Sellers or their 
Affiliates either (i) own the entire right, title and interest in 
and to the Intellectual Property free and clear of any 
Encumbrances; or (ii) have the royalty-free right to use the 
same.
 
ARTICLE 4.11.4 	Except as disclosed on Section 4.11.4 of 
the Disclosure Schedule, the Companies, Sellers and their 
Affiliates are not in breach of any material provision of any 
material agreement, commitment, contractual understanding, 
license, sublicense, assignment or indemnification which relates 
to any of the Intellectual Property used in the Business and they 
have not taken any action which would have a Material Adverse 
Effect on their rights in any of the Intellectual Property used 
in the Business.
 
ARTICLE 4.12 	Litigation and Claims.
 
ARTICLE 4.12.1 	Except as set forth in Section 4.12.1 of 
the Disclosure Schedule, and except for matters under 
Environmental Laws or relating to the Environmental Condition of 
the Real Property (as to which no representation or warranty is 
being made except as set forth in Section 4.14) there is no 
civil, criminal or administrative action, suit, hearing, 
proceeding or investigation pending or, to the knowledge of 
Sellers, threatened against any of the Companies or, to the 
extent involving the Assets, Sellers or the International 
Affiliates, other than those that individually or in the 
aggregate would not reasonably be expected to have a Cost in 
excess of $200,000.
 
ARTICLE 4.12.2 	Except as set forth in Section 4.12.2 of 
the Disclosure Schedule, and except for matters under 
Environmental Laws or relating to the Environmental Condition of 
the Real Property (as to which no representation or warranty is 
being made except as set forth in Section 4.14), none of the 
Companies nor, to the extent involving the Assets, Sellers or the 
International Affiliates are subject to any order, writ, 
judgment, award, injunction or decree of any court or 
Governmental Authority or any arbitrator or arbitrators other 
than those that would not reasonably be expected to have a Cost 
in excess of $200,000.
 
ARTICLE 4.13 	 Compliance with Law; Applicable 
Permits.  Except as set forth in Section 4.12 of the Disclosure 
Schedule or Section 4.13 of the Disclosure Schedule, and except 
for matters relating to Taxes which are addressed in Section 4.7, 
and except for matters under Environmental Laws or relating to 
the Environmental Condition of the Real Property and the 
International Premises (as to which no representation or warranty 
is made except as set forth in Section 4.14), the Business is 
being conducted in compliance with all Applicable Laws, except 
where the failure so to comply would not reasonably be expected 
to have a Cost in excess of $200,000.  The Companies (and Sellers 
and the International Affiliates to the extent relating to the 
Assets) have all Applicable Permits necessary to own, operate or 
lease their respective properties and to conduct the Business as 
currently conducted, other than those the absence of which would 
not reasonably be expected to have a Material Adverse Effect.  
There are no proceedings pending or, to the knowledge of Sellers, 
the International Affiliates, or the Companies threatened which 
may result in the revocation, cancellation or suspension of any 
such Applicable Permits, except those the absence of which would 
not reasonably be expected to have a Material Adverse Effect.
 
ARTICLE 4.14 	Environmental Matters.  Except as 
disclosed on Section 4.14 of the Disclosure Schedule:
 
ARTICLE 4.14.1 	Each of the Companies has obtained those 
environmental permits, licenses or approvals necessary for its 
operation, or as required by law, other than those the absence of 
which would not be reasonably expected to have a Material Adverse 
Effect, which permits are in full force and effect and is in 
compliance with such permits and other requirements of applicable 
Environmental Laws except where the failure to so comply would 
not be reasonably expected to have a Cost in excess of $200,000 
and Sellers have no knowledge of any such failures to comply 
which have occurred in the past;
 
ARTICLE 4.14.2 	none of the Companies has received any 
written notice of or is otherwise aware of any claims by any 
Governmental Authority alleging a violation of any Environmental 
Laws which have not been complied with except where the failure 
to so comply would not be reasonably expected to have a Cost in 
excess of $200,000 and, to Sellers' knowledge, no such actions 
are threatened;
 
ARTICLE 4.14.3 	to the knowledge of Sellers, the Real 
Property does not contain any underground storage tanks, surface 
impoundments containing any Hazardous Substance, PCB-containing 
materials or any exposed, friable asbestos-containing materials 
the presence of which would reasonably be expected to have a Cost 
in excess of $200,000;
 
ARTICLE 4.14.4 	none of the Companies has received any 
written notice, claim, or request for information relating to any 
third party waste disposal site or former property, alleging that 
either of them is or may be liable to any person or Governmental 
Authority as a result of a Release or threatened Release by any 
of the Companies, or generated by any of the Companies; and
 
ARTICLE 4.14.5 	to the knowledge of Sellers, there has 
been no Release at or on any Real Property that would reasonably 
be expected to result in a Cost in excess of $200,000;
 
ARTICLE 4.14.6 	Section 4.14.6 of the Disclosure 
Schedule is an accurate description of Sellers' recent 
environmental assessment program as it relates to the Business.
 
ARTICLE 4.15 	FDA Matters.  Except as set forth on 
Section 4.15 of the Disclosure Schedule, there are no products 
being sold in connection with the Business which at the date 
hereof would require any approval of the United States Food and 
Drug Administration (the "FDA") or any other Governmental 
Authority,  for the purpose for which they are being sold for 
which such approval has not been obtained.  All products now 
being commercially distributed in connection with the Business in 
any jurisdiction meet the applicable legal requirements of such 
jurisdiction in all material respects and all requisite 
governmental approvals have been duly obtained and are in full 
force and effect.  There is no action or proceeding by the FDA or 
any other governmental body (including, but not limited to, 
recalls, warning letters or inspection observation reports) 
pending or, to the knowledge of Sellers, threatened that relate 
to safety or efficacy of any of its products sold in connection 
with the Business.
 
ARTICLE 4.16 	Labor Matters.  Except as disclosed in 
Section 4.16 of the Disclosure Schedule, none of the Companies is 
a party to any collective bargaining agreement and there are no 
unfair labor practice proceedings affecting any of the Employees 
or any labor or other collective bargaining unit representing any 
Employee that would reasonably be expected to have a Cost in 
excess of $200,000.
 
ARTICLE 4.17 	Insurance.  Section 4.17 of the 
Disclosure Schedule sets forth a list of all insurance policies 
and bonds provided by third parties currently maintained by or on 
behalf of the Companies, or relating exclusively to the 
International Business, Wyeth Storz Business and Cyanamid Storz 
Business.
 	
ARTICLE 4.18 	Broker's Fees.  Except for the retention 
of Bear Stearns & Co. Inc., the fees and expenses of which will 
be paid by Sellers pursuant to Section 7.2, none of the Companies 
nor Sellers have employed any broker, finder or investment banker 
or incurred any liability for any brokerage, finder's or other 
fee or commission in connection with the transactions 
contemplated by this Agreement.
 
ARTICLE 4.19 	Undisclosed Liabilities.  Except for (i) 
matters identified in Section 4.19 of the Disclosure Schedule, 
(ii) liabilities reflected or reserved for in the Financial 
Statements, (iii) liabilities of a type not required to be 
reflected in the Financial Statements in accordance with GAAP, 
and (iv) liabilities incurred in the ordinary course of business 
consistent in nature and amount with the comparable period of the 
preceding fiscal year, since June 30, 1997, no liabilities have 
arisen with respect to the Business (whether accrued, absolute, 
contingent or otherwise).
 
ARTICLE 4.20 	Certain Interests.  Except as set forth 
in Section 4.20 of the Disclosure Schedule, no officer or 
director of Sellers or the Companies, is indebted or otherwise 
obligated to the Companies; and the Companies are not indebted or 
otherwise obligated to any such Person, except for amounts due 
under normal arrangements applicable to all employees generally 
as to salary or reimbursement of ordinary business expenses not 
unusual in amount or significance.
 
ARTICLE 4.21 	Intercompany Transactions.  Except as 
described in Section 4.21 of the Disclosure Schedule, none of the 
goods and services provided by Sellers or any Affiliates of 
Sellers to the Companies is required or necessary for the ongoing 
operation of the Companies or the conduct of the Business.  
Except as described in Section 4.21 of the Disclosure Schedule, 
consummation of the transactions contemplated by this Agreement 
will not (either alone, or upon the occurrence of any act or 
event, or with the lapse of time, or both) result in any payment 
arising or becoming due from the Companies to Sellers or any 
Affiliates of Sellers.
 
ARTICLE 4.22 	Receivables.  Except as disclosed in 
Section 4.6 of the Disclosure Schedule, all receivables of the 
Companies represent sales actually made in the ordinary course of 
business.
 	
ARTICLE 4.23 	Disclosure; No Other Representations or 
Warranties.  Except for the representations and warranties of 
Sellers set forth in this Agreement, neither Sellers nor any 
other Person makes any other express or implied representation or 
warranty on behalf of Sellers, or otherwise in respect of the 
Business.  Disclosure in a particular Section of the Disclosure 
Schedule shall be deemed to be a disclosure in all other Sections 
thereof.
 
 
ARTICLE 5 
 	REPRESENTATIONS AND WARRANTIES OF BUYER
 
 		Buyer represents and warrants to Sellers as follows:
 
ARTICLE 5.1 	Corporate Organization.  Buyer is a 
corporation duly organized, validly existing and in good standing 
under the laws of New York.  Buyer has the requisite corporate 
power and authority to own, operate or lease the properties that 
it purports to own, operate or lease and to carry on its business 
as it is now being conducted and is duly licensed or qualified as 
a foreign corporation in each domestic or foreign jurisdiction in 
which the nature of the business conducted by it or the character 
or location of the properties owned or leased by it makes such 
licensing or qualification necessary, except where the failure to 
be so licensed or qualified would not reasonably be expected to 
have a material adverse effect on the business, operations or 
financial condition of Buyer and its subsidiaries, taken as a 
whole.
 
ARTICLE 5.2 	Authority Relative to this Agreement.  
Buyer has the requisite corporate power and authority to execute 
and deliver this Agreement and the other agreements contemplated 
hereby and to consummate the transactions contemplated hereby and 
thereby.  The execution and delivery by Buyer of this Agreement 
and the other agreements contemplated hereby and the consummation 
by Buyer of the transactions contemplated hereby and thereby have 
been duly authorized by all necessary corporate action on the 
part of Buyer and no other corporate proceeding is necessary for 
the execution and delivery of this Agreement or such other 
agreements by Buyer, the performance by Buyer of its obligations 
hereunder or thereunder and the consummation by Buyer of the 
transactions contemplated hereby and thereby.  This Agreement has 
been duly executed and delivered by Buyer and constitutes a 
legal, valid and binding obligation of Buyer, enforceable against 
Buyer in accordance with its terms, except as the same may be 
limited by bankruptcy, insolvency, moratorium, reorganization or 
other laws of general applicability relating to or affecting the 
enforcement of creditor's rights and general principles of 
equity.
 
ARTICLE 5.3 	Broker's Fees.  Except for the retention of 
Chase Securities Inc., the fees and expenses of which will be 
paid by Buyer pursuant to Section 7.2, none of Buyer or any of 
its Affiliates has employed any broker, finder or investment 
banker or incurred any liability for any brokerage, finder's or 
other fee or commission in connection with the transactions 
contemplated by this Agreement.
 
ARTICLE 5.4 	Consents and Approvals; No Violations.  
Except as contemplated by Section 7.5 hereof, no material filing 
with, and no material permit, authorization, consent or approval 
of, any public body or authority is necessary for the 
consummation by Buyer of the transactions contemplated by this 
Agreement or the other agreements which Buyer will execute 
pursuant to the terms of this Agreement.  Buyer's execution and 
delivery of this Agreement and Buyer's or its Affiliates' 
execution, delivery and performance of such other agreements and 
Buyer's consummation of the transactions contemplated hereby and 
thereby will not (i) conflict with or result in a breach of any 
of the provisions of the Certificate of Incorporation or by-laws 
of Buyer, or (ii) subject to the making of the filings and the 
obtaining of the governmental and other consents referred to 
herein, contravene in any material respect any law, rule or 
regulation of any state, the United States or any foreign country 
or any order, writ, judgment, injunction, decree, determination 
or award currently in effect that is binding upon Buyer or any of 
its subsidiaries or any of their respective properties.
 
ARTICLE 5.5 	Financial Capability.  Buyer has the 
financial capacity to purchase the Shares and the Assets and to 
perform its obligations under the Contracts and Assumed 
Liabilities on the terms and subject to the conditions 
contemplated by this Agreement.
 
ARTICLE 5.6 	Securities Act.  Buyer is acquiring the 
Shares solely for the purpose of investment and not with a view 
to, or for sale in connection with, any distribution thereof in 
violation of the Securities Act.  Buyer acknowledges the Shares 
are not registered under the Securities Act or any applicable 
state securities law, and that such Shares may not be transferred 
or sold except pursuant to the registration provisions of such 
Securities Act or pursuant to an applicable exemption therefrom 
and pursuant to state securities laws and regulations as 
applicable.
 
ARTICLE 5.7 	Due Diligence.  In connection with the 
transactions contemplated herein and in the agreements to be 
executed in connection therewith, Buyer has performed a 
comprehensive due diligence investigation of the Business.
 
ARTICLE 5.8 	Chiron Purchase Agreement.  The Chiron 
Purchase Agreement has been duly executed and delivered by the 
parties thereto, constitutes a valid and binding agreement and 
contains no conditions to the consummation of the transactions 
contemplated therein other than those previously delivered to 
Sellers.
 
ARTICLE 5.9 	No Other Representations or Warranties.  
Except for the representations and warranties of Buyer expressly 
set forth in this Agreement, neither Buyer nor any other Person 
makes any other express or implied representation or warranty on 
behalf of Buyer.
 
 
ARTICLE 6 
 	CONDUCT OF BUSINESS PENDING THE CLOSING
 
ARTICLE 6.1 	Conduct of Business Pending the Closing.  
Except as disclosed in Section 6.1 of the Disclosure Schedule, 
Sellers and Buyer agree that, prior to the Closing, unless Buyer 
shall otherwise consent in writing (which consent Buyer shall not 
unreasonably withhold) or as otherwise expressly contemplated by 
this Agreement, the following provisions shall apply:
 
ARTICLE 6.1.1 	The Business shall be conducted only in 
the ordinary course of business and consistent with past 
practices.
 
ARTICLE 6.1.2 	Sellers shall not, and shall cause the 
Companies not to do any of the following:  (i) authorize for 
issuance, issue, sell, pledge, deliver, or agree or commit to 
issue, sell, pledge or deliver (whether through the issuance or 
grant of options, warrants, commitments, subscriptions, rights to 
purchase or otherwise) any capital stock of the Companies or 
securities or rights convertible into or exchangeable for, shares 
of capital stock or securities convertible into or exchangeable 
for such shares; (ii) amend or propose to amend their Certificate 
of Incorporation (or other similar charter documents) or by-laws; 
(iii) split, combine or reclassify any shares of their capital 
stock; (iv) redeem, purchase or otherwise acquire or offer to 
redeem, purchase or otherwise acquire any capital stock; or (v) 
authorize or propose any of the foregoing or enter into any 
contract, agreement, commitment or arrangement to do any of the 
foregoing; provided, however, that Sellers shall continue to have 
the right to withdraw cash from the Companies, either in the form 
of a dividend or in the form of a cash advance, and, 
correspondingly, to provide cash to the Companies, either in the 
form of a contribution to capital or an intercompany loan, in a 
manner consistent with their past practice and the cash 
management programs which they have in place, generally, for 
their Affiliates.  Buyer acknowledges that all cash will be 
dividended out of the Companies prior to the Closing and, to the 
extent possible, the Excluded Assets and Excluded Liabilities 
relating to the Companies will be assigned or dividended out of 
the Companies prior to the Closing as contemplated by Section 
7.13.
 
ARTICLE 6.1.3 	Sellers shall cause the Companies and, 
to the extent related to the Business, the International 
Affiliates, not to (i) acquire (by merger, consolidation or 
acquisition of stock or assets) any corporation, partnership or 
other business organization or division thereof or make any 
investment either by purchase of stock or securities, 
contributions to capital, property transfer or purchase of any 
amount of property or assets of any other individual or entity; 
(ii) acquire any assets other than pursuant to the current 
capital expenditure budget of the Companies and other than 
purchases in the ordinary course of business; (iii) dispose of 
any assets other than in the ordinary course of business; (iv) 
incur any indebtedness for borrowed money or issue any debt 
securities or assume, guarantee, endorse or otherwise as an 
accommodation or become responsible for, the obligations of any 
other Person, make any loans or advances or enter into any other 
transaction, except the occurrence of intercompany loans or the 
making of intercompany advances in the ordinary course of 
business consistent with past practice and except for advances to 
Employees for expenses in the ordinary course of business and 
consistent with past practice; (v) authorize, recommend or 
propose any change in its capitalization; or (vi) authorize or 
propose any of the foregoing or enter into or modify any 
contract, agreement, or commitment or arrangement with respect to 
any of the foregoing.
 
ARTICLE 6.1.4 	Except as otherwise contemplated by this 
Agreement, Sellers shall not adopt or amend any U.S. Employee 
Plan, U.S. Benefit Arrangement or International Plan, each as 
hereinafter defined, or increase or pay any benefit not required 
by any existing U.S. Employee Plan, U.S. Benefit Arrangement or 
International Plan (as defined in Section 9.2), or increase any 
salaries or wages, other than in the ordinary course of business 
or as may be required by a Governmental Authority.
 
ARTICLE 6.1.5 	Sellers shall cause the Companies and 
the International Affiliates not to waive, release, grant or 
transfer any Intellectual Property or modify or change in any 
material respect any existing material license, distribution 
agreement, lease, or other document, in each case, other than in 
the ordinary course of business.
 
ARTICLE 6.1.6 	Sellers shall not, and shall cause the 
International Affiliates and the Companies not to, (i) terminate 
or fail to renew any existing insurance coverage, (ii) terminate, 
amend or fail to renew or preserve any material Applicable 
Permits, (iii) agree to or make any commitment to take any action 
that is or would be prohibited by this Section 6.1.6.
 
ARTICLE 6.2 	Permitted Actions.  Notwithstanding any 
other provisions herein to the contrary, as contemplated by 
Section 7.13, prior to the Closing, Sellers shall be permitted to 
cause each of the Companies to transfer by way of dividend or 
otherwise to Cyanamid or AHP or any of their Affiliates, as the 
case may be, any Excluded Assets, including but not limited to 
cash or cash equivalents held by such Company from time to time 
up to and including the Closing Date.  Except to the extent 
otherwise agreed between Sellers and Buyer, Sellers shall, with 
respect to the Companies, or otherwise with respect to the 
Business, extinguish all intercompany receivables and other 
intercompany assets, and intercompany payables and other 
intercompany liabilities (including without limitation all 
intercompany Tax and equity accounts), and shall repay 
obligations for borrowed money of the Companies.  For purposes of 
this Section 6.2, intercompany receivables, intercompany assets, 
intercompany payables and intercompany liabilities shall mean 
receivables, assets, payables and liabilities between any of the 
Companies, or otherwise with respect to the Business, and any of 
their Affiliates.
 
ARTICLE 6.3 	Preservation of Business Prior to the 
Closing.  During the period beginning on the date hereof and 
ending on the Closing Date, (i) Sellers will use their 
commercially reasonable efforts to preserve the Business and to 
preserve the goodwill of customers, suppliers and others having 
business relations with Sellers, the International Affiliates and 
the Companies and (ii) Sellers and Buyer will consult with each 
other concerning, and Sellers will cooperate with Buyer's efforts 
to keep available the Employees.
 
ARTICLE 6.4 	Bank Accounts.  Upon or prior to Closing, 
Sellers shall terminate any agreements or arrangements providing 
Sellers with the right to remove cash from the Companies' bank 
accounts after the Closing.
 
ARTICLE 6.5 	Change of Name.  Prior to Closing, Sellers 
shall be permitted to change the corporate name of Chirurgie to 
delete any reference to "Cyanamid".
 
ARTICLE 7 
 	ADDITIONAL AGREEMENTS
 
ARTICLE 7.1 	No Transfer of Shares.  Sellers agree that 
from the date of this Agreement through the earlier of the 
Closing Date or the termination of this Agreement, they shall not 
transfer, sell, hypothecate or otherwise assign any interest in 
the Shares or, except in the ordinary course of business and 
consistent with past practice, the Assets.
 
ARTICLE 7.2 	Expenses.  Except as otherwise provided in 
Section 3.5.3, all expenses, including the fees of any attorneys, 
accountants, investment bankers or others engaged by Sellers or 
Buyer, incurred in connection with this Agreement and the 
transactions contemplated hereby, shall be paid by the party 
incurring such expenses whether or not the transactions 
contemplated by this Agreement are consummated, provided, that in 
the event such transactions are consummated, any such fees 
incurred by the Companies shall be paid by Sellers.
 
ARTICLE 7.3 	Additional Agreements.  Subject to the 
terms and conditions herein provided, each of the parties hereto 
agrees (i) to use all reasonable efforts to do, or cause to be 
done, all things necessary, proper or advisable to consummate the 
transactions contemplated by this Agreement and to cooperate with 
each other in connection with the foregoing, (ii) to defend all 
lawsuits or other legal proceedings challenging this Agreement or 
the consummation of the transactions contemplated hereby, (iii) 
to use all reasonable efforts to lift or rescind any injunction 
or restraining order or other order adversely affecting the 
ability of the parties to consummate the transactions 
contemplated hereby, (iv) to use all reasonable efforts to effect 
all necessary registrations and filings and submissions of 
information required or requested by Governmental Authorities 
with respect to the transactions contemplated hereby and (v) in 
the case of Sellers and the International Affiliates, to convey 
to Buyer and its Affiliates any purchase orders and inquiries 
relating to the International Business received after the 
Closing.
 
ARTICLE 7.4 	Access to Information.  Prior to the 
Closing, Sellers shall, and shall cause the Companies and the 
International Affiliates to, afford the officers, employees and 
agents of Buyer reasonable access to the facilities, records (not 
including confidential personnel records prohibited by Applicable 
Laws) and Employees relating to the Business during normal 
business hours and in a manner that will not unreasonably disrupt 
the operation of the Business.  In connection therewith, the 
parties will comply with the terms of the Confidentiality 
Agreement dated July 27, 1995 between Buyer and Bear Stearns & 
Co. Inc., as agent of AHP, as amended, which agreement shall 
survive the termination of this Agreement; provided, however, 
that to the extent any provision thereof is inconsistent or 
conflicts with any provision of this Agreement, the provision of 
this Agreement shall govern.
 
ARTICLE 7.5 	Filings and Authorizations.  Buyer and the 
ultimate parent entities of the Companies will, as promptly as 
practicable, file or supply, or cause to be filed or supplied, 
all notifications and information required to be filed or 
supplied pursuant to the Hart-Scott-Rodino Antitrust Improvements 
Act of 1976, as amended and the related regulations and published 
interpretations (the "HSR Act") and, if necessary, any other 
Competition Laws, in connection with the transactions 
contemplated by this Agreement.  As promptly as practicable, (i) 
Sellers and Buyer will make, or cause to be made, all such other 
filings and submissions under laws, rules and regulations 
applicable to them, or to their subsidiaries and Affiliates, as 
may be required for them to consummate the transactions 
contemplated hereby in accordance with the terms of this 
Agreement, and (ii) Buyer will exercise commercially reasonable 
efforts to obtain, or cause to be obtained, all authorizations, 
approvals, consents and waivers from all Governmental Authorities 
necessary to be obtained by Buyer, its subsidiaries or 
Affiliates, in order for them so to consummate such transactions. 
 Notwithstanding anything in this Agreement to the contrary, 
including, without limitation, clause (ii) above, Buyer covenants 
that it will, or cause its Affiliates to, take all actions 
necessary, including any divestiture or hold separate agreements, 
to obtain all regulatory clearances, authorizations, waivers, 
consents and approvals from Governmental Authorities with respect 
to Competition Laws, provided that nothing herein shall be 
construed to require Buyer or its Affiliates to dispose of or 
hold separate business or product lines which generated annual 
gross sales for the year ended December 31, 1996 in excess of 10 
percent (10%) of the Purchase Price.  Subject to the foregoing, 
each party hereto shall (x) use its reasonable efforts to prevent 
the entry into a judicial or administrative proceeding brought 
under any antitrust law by any Governmental Authority with 
jurisdiction over enforcement of any applicable Competition Law 
or any other party of any preliminary injunction or other order 
that would make consummation of the purchase of the Shares and 
the Assets in accordance with the terms of this Agreement 
unlawful or would prevent or delay it (including defending any 
litigation that could result in the entry of such injunction or 
order); and (y) take promptly, in the event that such an 
injunction or order has been issued in such a proceeding, all 
steps reasonably necessary to prosecute an appeal of such 
injunction or order; provided, however, that neither Sellers nor 
Buyer shall be required to undertake more than one such appeal.
 
ARTICLE 7.6 	Information for Other Filings.  The parties 
represent to each other that the information provided and to be 
provided by Buyer and Sellers, respectively, for use in any 
document to be filed with any Governmental Authority in 
connection with the transactions contemplated hereby shall, at 
the respective times such documents are filed with the 
Governmental Authority and on the Closing Date, be true and 
correct in all material respects and shall not omit to state any 
material fact required to be stated therein or necessary in order 
to make such information not false or misleading, and Sellers and 
Buyer each agree to so correct any such information provided by 
it for use in such documents that shall have become false or 
misleading.
 
ARTICLE 7.7 	Tax Matters.
 
ARTICLE 7.7.1 	Liability for Taxes.
 
 			(a)	Sellers shall be liable for, and shall 
indemnify Buyer against, all (i) Taxes imposed on any of Sellers' 
Tax Affiliates (other than the Companies) for any taxable year or 
period excluding any Taxes included in Section 7.7.l(e), (ii) 
Taxes imposed on the Companies or for which the Companies may 
otherwise be liable for any taxable year or period that ends on 
(and including) or before the Closing Date and, with respect to 
any Straddle Period, the portion of such Straddle Period ending 
on and including the Closing Date (including, without limitation, 
any obligation to contribute to the payment of a Tax determined 
on a consolidated, combined or unitary basis with respect to the 
Companies and any of Sellers' Tax Affiliates), (iii) Section 338 
Taxes, and (iv) all income or franchise Taxes caused by or 
incurred in connection with all transactions contemplated by this 
Agreement.
 
 			(b)	Buyer shall be liable for, and shall 
indemnify Sellers against, Taxes imposed on the Companies or 
Buyer for any taxable year or period that begins after the 
Closing Date and with respect to any Straddle Period, the portion 
of such Straddle Period beginning after the Closing Date 
(including, without limitation, any obligation to contribute to 
the payment of a Tax determined on a consolidated, combined or 
unitary basis with respect to Buyer and its Tax Affiliates).
 
 			(c)	For purposes of paragraphs (a) and (b) of 
Section 7.7.1, whenever it is necessary to determine the 
liability for Taxes of the Companies a Straddle Period, the 
determination of the Taxes of the Companies for the portion of 
the Straddle Period ending on, and the portion of the Straddle 
Period beginning after, the Closing Date shall be determined by 
assuming that the Straddle Period consisted of two taxable years 
or periods, one which ended on the Closing Date and the other 
which began at the beginning of the day following the Closing 
Date, and items of the Companies for the Straddle Period shall be 
allocated between such two taxable years or periods on a 
"closing of the books basis" by assuming that the books of the 
Companies were closed at the close of business on the Closing 
Date, provided, however, that (i) exemptions, allowances or 
deductions that are calculated on an annual basis, such as the 
deduction for depreciation, shall be apportioned between such two 
taxable years or periods on a daily basis, (ii) extraordinary 
items described in Treas. Reg. Section 1.1502-76(b)(2)(ii)(C) shall be 
allocated to the day that they are taken into account and any 
item relating to any Section 338 Taxes shall be allocated to the 
Closing Date.
 
 			(d)	For purposes of paragraphs (a) and (b) of 
Section 7.7.1, where, under applicable law, a taxable year or 
period ends as a result of the purchase of the Shares pursuant to 
this Agreement, items of income, gain, deduction, loss or credit 
shall be allocated between such taxable year or period and the 
following taxable year or period in a manner consistent with the 
rules in Treas. Reg. Section 1.1502-76(b).
 
 			(e)	Buyer, on the one hand, and Sellers, on the 
other hand, shall share equally any real property transfer or 
gains Tax, sales Tax, use Tax, stamp Tax, stock transfer Tax, or 
other similar Tax imposed on the transactions contemplated by 
this Agreement, provided that any value added Tax shall be the 
obligation of Buyer to the extent Buyer is entitled to claim 
credit for such value added Tax.  This paragraph shall not apply 
to franchise, income or other Taxes based on income.
 
 			(f)	Within 60 days after the date of this 
Agreement, Sellers will deliver or cause to be delivered to Buyer 
true and complete copies, to the extent available, of:  (i) all 
income Tax Returns of the Companies for periods subsequent to 
December 31, 1993, and any other open Tax years (or, with respect 
to consolidated, combined or unitary returns, the portion thereof 
relating to the Companies); (ii) any other Tax Returns for 
periods subsequent to December 31, 1993, and any other open Tax 
years, reasonably requested by Buyer, as may be relevant to the 
Companies or the assets or operations thereof; and (iii) any 
workpapers or other supporting data reasonably requested by Buyer 
relating to "income Taxes payable" reflected in the books and 
records of the Companies as of December 31, 1995, relating to Tax 
Returns made available pursuant to clause (i) or (ii) or relating 
to Tax Returns referred to in (i) or (ii) not yet filed.
 
ARTICLE 7.7.2 	Tax Returns.  Sellers shall file or 
cause to be filed when due all Tax Returns that are required to 
be filed by or with respect to the Companies for taxable years or 
periods ending on or before the Closing Date and Sellers shall 
remit (or cause to be remitted) to the appropriate Governmental 
Authority any Taxes due in respect of such Tax Returns, and Buyer 
shall file or cause to be filed when due all Tax Returns that are 
required to be filed by or with respect to the Companies for 
taxable years or periods ending after the Closing Date and Buyer 
shall remit (or cause to be remitted) to the appropriate 
Governmental Authority any Taxes due in respect of such Tax 
Returns.  Sellers or Buyer shall reimburse the other party the 
Taxes for which Sellers or Buyer is liable pursuant to Section 
7.7.1 but which are payable with any Tax Return to be filed by 
the other party pursuant to the previous sentence upon written 
request of the party entitled to reimbursement setting forth in 
detail the computation of the amount owed by Sellers or Buyer, as 
the case may be, but in no event less than 15 days prior to the 
due date for the filing of such Tax Return.  All Tax Returns 
which Sellers are required to file or cause to be filed in 
accordance with this Section 7.7.2 shall be prepared and filed in 
a manner consistent with past practice in preparing and filing 
similar Tax Returns and Sellers shall not thereafter amend any 
Tax Return to take positions inconsistent with such past 
practice.
 
ARTICLE 7.7.3 	Contest Provisions.  Buyer shall notify 
Sellers in writing upon receipt by Buyer, any of its Tax 
Affiliates, or any of the Companies of notice of any pending or 
threatened federal, state, local or foreign Tax audits or 
assessments which may materially affect the Tax Liabilities of 
the Company for which Sellers would be required to indemnify 
Buyer pursuant to Section 7.7.1.  Sellers shall have the sole 
right to represent the Companies' interests in any Tax audit or 
administrative or court proceeding relating to taxable periods 
ending on or before the Closing Date, and to employ counsel of 
its choice at its expense.  Provided however that if any 
adjustment or settlement would materially affect the step up 
value of the assets deemed purchased under the Section 338(h)(10) 
election, or if such adjustment or settlement otherwise would 
materially increase the Tax liability of the Companies for any 
period after the Closing Date.  Buyer shall be entitled to 
participate in discussions with the Taxing Authority and Sellers 
shall not agree to such an adjustment or settlement without the 
consent of Buyer, which shall not be unreasonably withheld.
 
ARTICLE 7.7.4 	Buyer and Sellers agree to cooperate and 
share all required information on a timely basis in order to 
timely file all Tax Returns and for the preparation of any audit, 
and for the prosecution or defense of any claim, suit or 
proceeding relating to any proposed adjustment.  Buyer and 
Sellers agree to retain or cause to be retained all books and 
records pertinent to the Companies until the applicable period 
for assessment under applicable law (giving effect to any and all 
extensions or waivers) has expired, and to abide by or cause the 
abidance with all record retention agreements entered into with 
any Governmental Authority.  After the Closing, Buyer will give 
Sellers reasonable notice prior to discarding or destroying any 
such books and records relating to Tax matters and, if Sellers so 
request, Buyer will allow Sellers (at Sellers' expense) to take 
possession of such books and records.  Buyer and Sellers shall 
cooperate with each other in the conduct of any audit or other 
proceedings involving the Companies for any Tax purpose and each 
shall execute and deliver such powers of attorney and other 
documents as are necessary and appropriate to carry out the 
intent of this Section.
 
ARTICLE 7.7.5 	Election Under Section 338(h)(10).
 
 			(a)	At the request of Buyer, Sellers and Buyer 
shall make a joint election for all or some of the Companies 
under Section 338(h)(10) of the Code and/or under any applicable 
similar provisions of state law with respect to the purchase of 
the Shares (collectively, the "Section 338(h)(10) Elections"). 
 Buyer shall be responsible for, and control the preparation of, 
all federal, state and local forms needed to make the Section 
338(h)(10) Elections requested by Buyer and shall be responsible 
for any defects in such election.  Sellers represent that the 
Section 338(h)(10) Elections are available for the Companies.  If 
the Section 338(h)(10) Elections are made, Sellers and Buyer 
shall, within 10 days after receipt of the Allocation Schedule, 
exchange completed and executed copies of Internal Revenue 
Service Form 8023-A, required schedules thereto, and any similar 
state forms.  If any changes are required in these forms as a 
result of information which is first available after these forms 
are prepared or otherwise, the parties will promptly agree on 
such changes, and Sellers shall take such steps as are reasonably 
requested by Buyer to effectuate or cure any defect in the 
Section 338(h)(10) Elections.
 
 			(b)	Sellers and Buyer shall cause an 
independent appraiser selected by Buyer (the "Appraiser") to 
conduct and to deliver to Buyer and Sellers, within 90 days 
following the determination of the Final Net Asset Value, an 
appraisal (the "Appraisal") of the fair market value as of the 
Closing Date of the assets acquired pursuant to this Agreement 
(including the assets of the Companies).  The cost of the 
Appraisal shall be paid by Buyer.  Buyer shall deliver a copy of 
the Appraisal to Seller.
 
 			(c)	Within 60 days following receipt of the 
Appraisal, Buyer shall deliver to Sellers a schedule (the 
"Allocation Schedule") allocating the Modified Adjusted Deemed 
Sales Price, as defined in Treas. Reg. Section 1.338(h)(10)-1(f), for 
the Companies among the assets of the Companies.  The Allocation 
Schedule shall be reasonable and shall be prepared in accordance 
with Sections 338(h)(10) and 1060 of the Code and the regulations 
thereunder and in accordance with the Appraisal.  Sellers agree 
that promptly upon receiving the Allocation Schedule, assuming 
that the Allocation Schedule satisfies the requirements set forth 
in the preceding sentence, Sellers shall sign the Allocation 
Schedule and return an executed copy thereof to Buyer.  Buyer and 
Sellers each agree to file all federal, state, local and foreign 
Tax Returns in accordance with the Allocation Schedule and not to 
take or cause to be taken, any action that would be inconsistent 
with or prejudice any Section 338(h)(10) Elections.
 
ARTICLE 7.7.6   Adjustment to Purchase Price.  Any 
payment by Buyer or Sellers under Section 7.7 will be deemed for 
tax purposes an adjustment to the Purchase Price.
 
ARTICLE 7.7.7 	Survival of Obligations.  
Notwithstanding anything to the contrary in this Agreement, and 
notwithstanding Section 12.3 of this Agreement, the obligations 
of the parties set forth in Section 7.7 shall be unconditional 
and absolute and shall remain in effect until the expiration of 
the applicable statute of limitations.
 
ARTICLE 7.8 	Covenant Not to Compete.
 
ARTICLE 7.8.1 	Sellers, for and on behalf of themselves 
and each of their respective Affiliates, agree that for a period 
of three years after the Closing Date, they shall not own, 
manage, operate, control or otherwise engage in any Competitive 
Business (as hereinafter defined); provided, however, that 
nothing herein contained shall be construed to prevent Sellers or 
any of their Affiliates from acquiring or merging with any 
business, Person or entity 80% or more of whose consolidated 
revenues for the most recently completed fiscal year prior to 
such acquisition were derived from businesses other than a 
Competitive Business.
 
ARTICLE 7.8.2 	"Competitive Business" shall mean a 
business in the Business Field, provided, however, Buyer 
acknowledges that each of clauses (i), (ii), (iii) and (iv) 
hereunder shall not constitute a Competitive Business: (i) the 
conduct of the business (which includes business derived from 
current research and development) of Sellers and their Affiliates 
as currently conducted (including the operations related to the 
Excluded Assets), (ii) the conduct of Sellers' joint venture 
partners who are not Affiliates, (iii) the manufacture, 
distribution and/or sale by Sellers or any of their Affiliates of 
vitamins, and/or nutraceuticals not primarily indicated (by 
labelling or packaging) for ophthmalic indications, but which may 
have opthmalic benefits, and Sellers may indicate that such 
product has ophthalmic benefits in addition to other benefits, 
provided, however, that Sellers and their Affiliates shall not 
during the three year period following the Closing Date directly 
promote or detail such products to eye care professionals.
 
ARTICLE 7.8.3 	In order to protect Buyer against any 
efforts by Sellers to cause Employees to terminate their 
employment, Sellers agree that for a period of one year following 
the Closing Date, Sellers will not directly or indirectly induce 
any Employees to leave their employment (and in the case of 
Cyanamid Storz Employees, hiring such Employees shall be 
prohibited for such term); provided however, the foregoing shall 
not apply to (i) Employees who first approach Sellers or their 
Affiliates for employment (except in the case of Cyanamid Storz 
Employees for whom hiring is prohibited hereunder for the term 
set forth in this Section 7.8.3) or (ii) solicitations or hiring 
(except in the case of Cyanamid Storz Employees for whom hiring 
is prohibited hereunder for the term set forth in this Section 
7.8.3) as part of a general employee solicitation not targeted at 
Employees (e.g. newspaper advertisements, etc.) or (iii) any 
Employee at any time that such Employee is no longer employed by 
Buyer or its Affiliates.
 
ARTICLE 7.8.4 	Sellers recognize and agree that a 
material breach by Sellers of any of the covenants set forth in 
this Section 7.8 would cause irreparable harm to Buyer, that 
Buyer's remedies at Law in the event of such breach would be 
inadequate, and that, accordingly, in the event of such breach a 
restraining order or injunction or both may be issued against 
Sellers, in addition to any other rights and remedies which are 
available to Buyer.  If this Section 7.8 is more restrictive than 
permitted by Applicable Law, this Section 7.8 shall be limited to 
the extent required to permit enforcement under any such 
Applicable Law.
 
ARTICLE 7.8.5 	For income tax purposes only, Buyer and 
Sellers agree that a portion of the Purchase price shall be 
allocated to the covenants in this Section 7.8.
 	
ARTICLE 7.9 	Use of Certain Names.  As soon as possible, 
but in no event later than 18 months after the Closing, Buyer 
shall cause the Companies to revise product literature and 
labeling (including stickering), change packaging and stationery, 
and otherwise discontinue use of the names "American Cyanamid", 
"Cyanamid", "American Home Products," "Lederle," "Cy" 
"Wyeth" and variations thereof (collectively, the "Names").  
In no event shall Buyer or the Companies use any Names after the 
Closing in any manner or for any purpose different from the use 
of such Names by the Companies during the period preceding the 
Closing.  With respect to product inventory manufactured by the 
Companies prior to the Closing, Buyer and the Companies may 
continue to sell such inventory, notwithstanding that it bears 
one or more of the Names, for a reasonable time after the Closing 
not to exceed eighteen months (or such time thereafter as Buyer 
may request if Sellers furnish their written consent, which shall 
not be unreasonably withheld).
 
ARTICLE 7.10 	Ancillary Agreements.  At the Closing, 
AHP or its Affiliates and Buyer will enter into the Supply 
Agreement(s), Research and Discovery Agreement, Diamox, Neptazane 
and Phospholine Iodide Co-Promotion Agreement, License Agreement, 
Cidofovir Co-Promotion Agreement, Product Development Agreement 
and Transition Services Agreements.
 
ARTICLE 7.11 	Termination of Sale Discussions.  
Sellers shall promptly terminate any and all pending discussions 
with prospective buyers of the Business.  During the period 
between the date hereof and the Closing, unless this Agreement is 
terminated by either party in accordance with the provisions 
hereof, neither Sellers, the International Affiliates nor the 
Companies nor any of their respective officers or agents will, 
directly or indirectly, solicit any offers, bids or indications 
of interest, or initiate negotiations with any person, with 
respect to the Business or the Shares, nor shall Sellers, the 
International Affiliates or the Companies furnish, or authorize 
any agent or representative to furnish, any confidential 
information concerning the Companies or the Business to any third 
party.
 
ARTICLE 7.12 	Delivery of International Assets.  As 
soon as reasonably practicable after the Closing, but in no event 
later than 180 days, Buyer shall arrange to have the 
International Assets removed from the premises (other than the 
International Premises) of the International Affiliates holding 
such International Inventory, at Buyer's sole cost.  Sellers 
shall cause the International Affiliates to co-operate in 
arranging such removal.  Prior to such removal by Sellers, 
Sellers shall cause the International Affiliates to exercise 
ordinary care in connection with their possession of the 
International Assets.
 
ARTICLE 7.13 	Excluded Assets and Liabilities.  Buyer 
acknowledges and agrees that, to the extent assignable, Excluded 
Assets and Excluded Liabilities relating to the Companies will be 
transferred, conveyed or assigned, by dividend or otherwise to 
the extent practicable or otherwise as set forth in Section 
3.5.1, out of the Companies prior to the Closing.
 
ARTICLE 7.14 	Access to Records After Effective Time.
 
ARTICLE 7.14.1 	For a period of six years after the 
Closing, Sellers and their representatives shall have reasonable 
access to all of the books and records of the Companies with 
respect to periods prior to the Closing Date to the extent that 
such access may reasonably be required by Sellers in connection 
with matters relating to or affected by the operations of the 
Companies prior to the Closing Date.  The Companies shall afford 
such access upon receipt of reasonable advance notice and during 
normal business hours, Sellers shall be solely responsible for 
any costs or expenses incurred by them pursuant to this Section 
7.14.1.  If Buyer or the Companies shall desire to dispose of any 
of such books and records prior to the expiration of such 
six-year period, the Companies shall, prior to such disposition, 
give Sellers a reasonable opportunity, at Sellers' expense, to 
segregate and remove such books and records as Sellers may elect.
 
ARTICLE 7.14.2 	For a period of six years after the 
Closing Date, Buyer, the Companies and their respective 
representatives shall have reasonable access to all of the books 
and records relating to the Companies or the Business which 
Sellers or any of their Affiliates may retain after the Closing 
Date.  Such access shall be afforded by Sellers and their 
Affiliates upon receipt of reasonable advance notice and during 
normal business hours.  Buyer or the Companies, as the case may 
be, shall be solely responsible for any costs and expenses 
incurred by it pursuant to this Section 7.14.2.  If Sellers or 
any of their Affiliates shall desire to dispose of any of such 
books and records prior to the expiration of such six-year 
period, Sellers shall, prior to such disposition, give Buyer and 
the Companies a reasonable opportunity, at Buyer's or the 
Companies' expense, to segregate and remove such books and 
records as Buyer or the respective Companies may elect.
 
ARTICLE 7.15 	Disclosure Supplement.  Prior to 
Closing, Sellers shall deliver to Buyer supplements to the 
Disclosure Schedule, and without limitation on Buyer's right 
under Section 8.3.3 to receive an unqualified certificate 
regarding the continuing accuracy and performance of the 
representations, warranties and covenants of Sellers made on the 
date hereof, to the extent supplemental disclosures relate to 
developments between the date hereof and Closing or termination, 
and to the extent such subsequent disclosures would constitute 
breaches of representations and warranties contained herein as of 
the date hereof, any indemnity obligations of Sellers under 
Article 11 relating to such breaches shall be limited to and 
shall not exceed $1 million in the aggregate.  To the extent such 
supplemental disclosures would reasonably be expected to result 
in Costs in excess of $1 million, the parties agree to discuss 
such matters in good faith.
 
ARTICLE 7.16 	Foreign Distribution Agreements.  Prior 
to the Closing, Sellers shall cause the Companies and/or the 
International Affiliates to enter into agreements with 
distributors in Japan, Spain and Portugal on terms and conditions 
reasonably acceptable to Buyer (it being agreed that the 
principal terms contained in Exhibit H are acceptable to Buyer).
 
ARTICLE 7.17 	1997 Bonus.  Bonuses to be paid to 
Employees for performance in 1997, if any, shall be paid by 
Sellers, provided however, that payment of bonuses is in the sole 
discretion of Sellers.
 
ARTICLE 7.18 	Bundled Contracts.	To the extent 
permitted by Applicable Law, Buyer covenants and agrees that 
after the Closing it will continue to honor Sellers' commitments 
made in each such bundled contract with respect to supplying the 
relevant products, including the sale price, for the respective 
commitment terms set forth in Section 1.15 of the Disclosure 
Schedule.  As soon as practicable after the Closing Date, Sellers 
and Buyer will, at the request of Buyer, request each third party 
to the Bundled Contracts to relieve Sellers of their obligation 
to provide such products under each such Bundled Contract.
 
ARTICLE 7.19 	AREDS Arrangements.  Without the consent 
of Buyer, Sellers shall not terminate the Cooperative Research 
and Development Agreement dated March 11, 1993 with the National 
Eye Institute of the National Institute of Health prior to the 
expiration of its term.  In connection therewith, Buyer shall 
bear the cost of the supply of Ocuvite to the NIH under such 
agreement.  Sellers agree to share data relating to Ocuvite in 
the Business Field with Buyer.  The parties agree to share 
equally the stipend fees to be paid to the NIH pursuant to the 
letter agreement dated October 14, 1996.
 
ARTICLE 7.20 	AHP Guaranty Removal.  Buyer agrees to 
use diligent efforts in cooperation with Sellers to substitute 
the guaranty of Buyer for AHP's guaranty under the supply 
agreement dated September 1, 1996 between Storz and Dow Corning 
Corporation relating to the supply of silicone.
 
ARTICLE 7.21 	Gilead Consent.  The parties shall each 
use this diligent efforts to obtain the consent to the assignment 
of the license agreement dated August 1, 1994 between Gilead 
Sciences, Inc. and Cyanamid, and to institute Buyer as the 
obligor, rather than Cyanamid.
 
 
ARTICLE 8 
 CONDITIONS
 
 
ARTICLE 8.1 	Conditions to Obligation of each Party 
to Effect the Transactions Contemplated by this Agreement.  The 
obligation of each party to effect the transactions contemplated 
by this Agreement shall be subject to the fulfillment at or prior 
to the Closing Date of the following conditions:
 
ARTICLE 8.1.1   all governmental and other consents and 
approvals, if any, necessary to permit the consummation of the 
transactions contemplated by this Agreement shall have been 
obtained and any waiting period (and any extension thereof) 
applicable to the consummation of this Agreement under the HSR 
Act or under other Competition Laws shall have expired or been 
terminated; and
 
ARTICLE 8.1.2   no preliminary or permanent injunction 
or other order, decree or ruling issued by a court of competent 
jurisdiction or by a Governmental Authority nor any Applicable 
Law shall be in effect that would restrain or otherwise prevent 
the consummation of the transactions contemplated by this 
Agreement.
 
ARTICLE 8.2 	Conditions to the Obligation of Sellers. 
 The obligation of Sellers to effect the transactions 
contemplated by this Agreement is subject to the fulfillment at 
or prior to the Closing Date of the following conditions, except 
to the extent waived in writing by Sellers:
 
ARTICLE 8.2.1   Buyer shall have performed in all 
material respects each obligation and agreement and complied in 
all material respects with each covenant to be performed and 
complied with by it hereunder at or prior to the Closing Date.
 
ARTICLE 8.2.2   the representations and warranties of 
Buyer in this Agreement shall be true and correct in all material 
respects as of the Closing Date with the same force and effect as 
though made at such time, except for changes contemplated by this 
Agreement.
 
ARTICLE 8.2.3   Buyer shall have furnished to Sellers a 
certificate, dated as of the Closing Date, signed by a duly 
authorized officer of Buyer to the effect that all conditions set 
forth in Sections 8.2.1 and 8.2.2 have been satisfied.
 		
ARTICLE 8.3 	Conditions to the Obligation of Buyer.  
The obligation of Buyer to effect the transactions contemplated 
by this Agreement is subject to the fulfillment at or prior to 
the Closing Date of the following conditions, except to the 
extent waived in writing by Buyer:
 
ARTICLE 8.3.1   Sellers and the International Affiliates 
shall have performed in all material respects each obligation and 
agreement and complied in all material respects with each 
covenant to be performed and complied with by them hereunder at 
or prior to the Closing.
 
ARTICLE 8.3.2   the representations and warranties of 
Sellers in this Agreement shall be true and correct in all 
material respects as of the Closing Date with the same force and 
effect as though made at such time, except for changes 
contemplated by this Agreement.
 
ARTICLE 8.3.3   Sellers shall have furnished to Buyer a 
certificate, dated as of the Closing Date, signed by a duly 
authorized officer of each of Sellers to the effect that all 
conditions set forth in Sections 8.3.1 and 8.3.2 have been 
satisfied.
 
ARTICLE 8.3.4   Buyer shall have, simultaneously with 
the Closing hereunder, effected a closing of the Chiron 
Transaction under the Chiron Purchase Agreement.
 
 
ARTICLE 9 
 	AGREEMENTS WITH RESPECT TO EMPLOYEES
 	AND EMPLOYEE BENEFITS
 
ARTICLE 9.1 	U.S. Employee Plans.  Sellers hereby 
represent and warrant to Buyer that:
 
ARTICLE 9.1.1   Section 9.1.1 of the Disclosure Schedule 
lists each "employee benefit plan," as such term is defined in 
Section 3(3) of ERISA, which (i) is subject to any provision of 
ERISA, (ii) is maintained by the Companies or to which any of the 
Companies contributes to or has an obligation to contribute, and 
(iii) covers Storz Employees (hereinafter referred to 
collectively as the "U.S. Employee Plans").  With respect to 
each U.S. Employee Plan, Sellers will make available to Buyer a 
true and complete copy of the applicable plan document or summary 
plan description and the most recently filed IRS Form 5500.
 
ARTICLE 9.1.2   Except as disclosed in Section 9.1.2 of 
the Disclosure Schedule, none of the Companies nor any of the 
Companies' ERISA Affiliates has incurred any liability under 
Title IV of ERISA arising in connection with the termination of 
any Pension Plan which is subject to Title IV of ERISA that could 
become, after the Closing Date, an obligation of Buyer or any of 
its Affiliates.  No Pension Plan has incurred any "accumulated 
funding deficiency" (within the meaning of Section 412 of the 
Code), whether or not waived, and neither the Companies' nor any 
ERISA Affiliate has failed to make a required installment or any 
other payment required under Section 412 of the Code before the 
applicable due date.  As of the most recent valuation date for 
each of the Pension Plans which cover Storz Employees, the amount 
of unfunded benefit liabilities (as defined in Section 
4001(a)(18) of ERISA), is zero.
 
ARTICLE 9.1.3   Each U.S. Employee Plan that is a 
Pension Plan, and each Pension Plan that covers Cyanamid Storz 
Employees, has received a determination letter from the Internal 
Revenue Service and to the knowledge of Sellers nothing has 
occurred since the issuance of each such letter which could 
reasonably affect its qualification.
 
ARTICLE 9.1.4   Section 9.1.4 of the Disclosure Schedule 
includes a list of each management, employment, consulting, or 
other contract providing for the retention of services involving 
the payment of $100,000 or more and which is not otherwise 
disclosed in Section 4.10 of the Disclosure Schedule, and each 
plan or arrangement providing for fringe benefits as defined in 
Code Section 132, vacation benefits, supplemental nonqualified benefits, 
severance benefits, bonuses, stock options, stock appreciation or 
other forms of incentive compensation or post retirement 
insurance (including retiree life and medical benefits), 
compensation or benefits which (i) is not a Pension Plan, (ii) is 
entered into, maintained or contributed to, as the case may be, 
by any of the Companies, and (iii) covers Storz Employees, and 
dependents or beneficiaries thereof.  Such contracts, plans and 
arrangements as are described above, copies or descriptions of 
all of which will be made available to Buyer, are hereinafter 
referred to collectively as the "U.S. Benefit Arrangements."
 
ARTICLE 9.1.5   There is no pending or threatened claim 
in respect of any of the U.S. Employee Plans or U.S. Benefit 
Arrangements other than routine claims for benefits.  Each of the 
U.S. Employee Plans (i) has been administered in accordance with 
its terms in all material respects, and (ii) complies in form, 
and has been administered in accordance with the requirements of 
ERISA and, where applicable, the Code, in all material respects. 
 Except as disclosed in Section 9.1.5 of the Disclosure Schedule, 
no investigation, audit or dispute relating to any U.S. Employee 
Plan is pending before any court or governmental agency.
 
ARTICLE 9.1.6   None of the Companies nor any other 
"disqualified person" (within the meaning of Section 4975 of 
the Code) or "party in interest" (within the meaning of Section 
3(14) of ERISA) has taken any action with respect to any of the 
U.S. Employee Plans or U.S. Benefit Arrangements which could 
subject any such plan (or its related trust) or any of the 
Companies or any officer, director or employee of any of the 
foregoing to any penalty or tax under Section 502(i) of ERISA or 
Section 4975 of the Code.  None of the U.S. Employee Plans or 
U.S. Benefit Arrangements is liable for any tax imposed under 
Section 511 of the Code.
 
ARTICLE 9.1.7   Except as disclosed in Section 9.1.7 of 
the Disclosure Schedule, none of the Companies has been required, 
or has any obligation, to contribute to a multiemployer plan, as 
defined in Section 3(37) of ERISA, or has or expects to have any 
withdrawal liability assessed against it with respect to any such 
multiemployer plan.
 
ARTICLE 9.1.8   Except as disclosed in Section 9.1.8 of 
the Disclosure Schedule or as may be triggered by Buyer's failure 
to fulfill any of its obligations to Employees under Section 9.3 
and 9.4, none of the Companies have by reason of the transaction 
contemplated hereby, any obligation to make any payment to any 
Storz Employee or Cyanamid Storz Employee pursuant to any plan or 
existing contract or arrangement.
 
ARTICLE 9.1.9   There are no contractual obligations to 
pay severance benefits to Storz Employees or to Cyanamid Storz 
Employees other than the obligations described in Section 
9.3.2(b) and the schedules thereto.
 
ARTICLE 9.2 	International Plans.  Sellers hereby 
represent and warrant to Buyer that:
 
ARTICLE 9.2.1   Section 9.2.1 of the Disclosure Schedule 
lists each material employee benefit plan, program, policy or 
practice maintained or contributed to by any International 
Affiliate, Chirurgie or Storz GmbH for International Employees, 
Chirurgie Employees or Storz GmbH Employees (other than 
Governmental Authority mandated plans or funds maintained or 
contributed to by the International Affiliates, Chirurgie or 
Storz GmbH pursuant to Applicable Laws), including, without 
limitation, vacation, severance, disability, medical, dental, 
hospitalization, life insurance and incentive bonus, savings and 
retirement plans ("International Plans", "Chirurgie Plans" 
and "Storz GmbH Plans", respectively).  Summary descriptions of 
each International Plan, Chirurgie Plan and Storz GmbH Plan which 
is subject to Section 9.6.2 will be made available to Buyer by 
Sellers.
 
ARTICLE 9.2.2   To the knowledge of Sellers, all 
International Plans, Chirurgie Plans and Storz GmbH Plans are in 
compliance with, and have been administered in compliance with 
Applicable Laws, in all material respects and contributions 
required to be made to each such plan under the terms of the plan 
or any contract or labor or collective bargaining agreement or 
Applicable Law have been made or reserved.
 
ARTICLE 9.3 	Buyer's Obligations to Employees.
 
ARTICLE 9.3.1   Buyer shall be obligated to continue the 
employment of the Employees or offer employment to Employees on 
the following basis:
 
 			(a)  Buyer's acquisition of the Shares shall not 
result in the termination of employment of the Storz Employees, 
Storz GmbH Employees or Chirurgie Employees.  Buyer acknowledges 
that following the purchase and sale hereunder, the Surgical 
Instrument Workers Union will continue to be the collective 
bargaining representative of all union represented Storz 
Employees located at the St. Louis/Kirkwood facilities in the 
U.S., agrees to recognize the collective bargaining, work council 
or labor agreements applicable to the Storz GmbH Employees as in 
effect on the Closing Date, and agrees to assume the terms and 
conditions of any such collective bargaining, work council or 
labor agreements to which the Companies are subject on the 
Closing Date and are disclosed in the Disclosure Schedule.  
Notwithstanding the foregoing, nothing in this Agreement shall be 
deemed to restrict the ability of the Companies to terminate the 
employment of any of the Employees after the Closing Date.
 
 			(b)  With respect to Cyanamid Storz Employees and 
the International Employees except as set forth in subsection (c) 
below, Buyer shall offer or cause an Affiliate of Buyer to offer 
to hire or transfer each Cyanamid Storz Employee and 
International Employee as of the Closing Date, at the same or 
greater rate of cash compensation than that enjoyed by such 
Employee immediately prior to the Closing Date; and 
 
 			(c)  Buyer agrees to offer employment to all 
union, work council or labor represented International Employees 
and agrees to recognize the collective bargaining or labor 
representative of said employees and agrees to assume the terms 
and conditions of any collective bargaining agreement as in 
effect on the Closing Date.
 
ARTICLE 9.3.2   Buyer shall make the following payments 
or provide the following notification to Employees whom it 
terminates after the Closing Date:
 
 			(a)  After the Closing Date, the Companies or 
Buyer, as the case may be, will have sole responsibility for any 
obligations or liabilities to Storz Employees and Cyanamid Storz 
Employees at all locations under the Worker Adjustment and 
Retraining Notification Act or similar Applicable Laws of any 
jurisdiction relating to any plant closing or mass layoff or as 
otherwise required by any such Applicable Law.  Sellers in their 
capacities as agents for the Buyer agree to provide or cause the 
Companies to provide, prior to the Closing Date, such notices 
under the Worker Adjustment and Retraining Notification Act or 
similar Applicable Laws as requested by Buyer concerning 
employment terminations which will occur after the Closing Date; 
provided, however, that the notices shall be placed on the 
Buyer's letterhead, shall be prepared by the Buyer, the Buyer 
shall determine which Employees and which locations receive the 
notice and the Buyer shall be responsible for any defects in the 
notice or its delivery;
 
 
 			(b)  Buyer shall make or cause the Companies to 
make a separation payment to each Storz Employee and Cyanamid 
Storz Employee whose employment is terminated by Buyer or the 
Companies because of a reduction in the work force or job 
elimination at anytime before 24 months after the Closing Date.  
The separation payment shall be the higher of (i) the amount set 
forth in this Section 9.3.2(b)(i), or (ii) the amount a similarly 
situated employee of Buyer would receive as a separation payment. 
 For exempt and non-exempt employees, the payment will be 
calculated on the basis of two weeks of base pay for each full 
year of service to the Companies, Sellers, or their Affiliates, 
with a minimum payment of twelve weeks and a maximum payment of 
fifty-two weeks; provided, however, that for individuals who earn 
more than $75,000 annually, the minimum severance shall be six 
months.  For those employees listed in Section 9.3.2(b)(i)(A) of 
the Disclosure Schedule, the severance shall be calculated on the 
basis of the formula set forth in that Section of the Disclosure 
Schedule.  Field Sales employees as listed on Section 
9.3.2(b)(i)(B) of the Disclosure Schedule shall have any 
severance due calculated on the basis of their compensation as 
set forth in that Section of the Disclosure Schedule.  Buyer 
shall or shall cause the Companies to make separation payments if 
a Storz Employee or Cyanamid Storz Employee resigns from 
employment with the Company within 24 months after the Closing 
Date because (w) there is a reduction in his or her salary (other 
than for cause); (x) there is a materially adverse reduction in 
the nature and extent of his or her job responsibilities; (y) 
there is a material reduction in employee benefits; or (z) a 
condition of continued employment is a relocation of principal 
work place of greater than 25 miles (collectively "Constructive 
Termination").  Buyer shall also provide outplacement services 
as follows:  (a) non-exempt employees, up to $1,000; (b) exempt 
employees earning up to $80,000, up to $5,000; (c) exempt 
employees earning more than $80,000, up to 12% of base salary to 
a maximum of $15,000.  Buyer shall also extend coverage under its 
employee benefit plans to Employees who receive severance under 
the provisions of this Section 9.3.2(b) in accordance with the 
provisions set forth in Section 9.3.2(b) of the Disclosure 
Schedule.
 
 			(c)  Buyer shall, or shall cause the Companies or 
an Affiliate of Buyer as the case may be, to make a severance 
payment to each International Employee and Storz GmbH Employee 
whose employment is terminated by Buyer or its Affiliates because 
of reduction in work force or job elimination at any time before 
24 months after the Closing Date, or whose employment is 
terminated or deemed to be terminated by operation of law as a 
result of the transactions contemplated herein, in an amount 
equal to the severance benefit due in accordance with the 
applicable International Plan or Storz GmbH Plan relating to 
severance as set forth in Section 9.3.2(c) of the Disclosure 
Schedule plus any greater or additional severance benefit due in 
accordance with Applicable Laws.  In addition, Buyer shall, or 
shall cause an Affiliate to make a severance payment if an 
Chirurgie Employee, International Employee or Storz GmbH Employee 
resigns because of a Constructive Termination event.  Buyer shall 
promptly reimburse Sellers for any payments in the nature of 
severance required to be made by an International Affiliate to an 
International Employee as a result of the transactions 
contemplated herein.  To the extent permitted by Applicable Law, 
Buyer may require, or may cause the Companies to require, as a 
condition of any payments or benefit under this Section 9.3.2(c), 
that the Employee release all claims against Buyer, the Companies 
and their Affiliates.
 
ARTICLE 9.4 	Treatment of Sellers' U.S. Employee Plans 
and U.S. Benefit Arrangements.
 
ARTICLE 9.4.1   The Companies and Buyer shall retain or 
assume, as the case may be, (i) all Storz Employees' benefits, 
compensation, bonus, incentive, severance, and vacation 
liabilities and all other similar liabilities, whether arising 
under Applicable Laws of the United States, U.S. Employee Plans 
or U.S. Benefit Arrangements, or otherwise associated with any 
Storz Employee, regardless of whether the liabilities relate to 
events which occurred on or prior to the Closing Date or to 
actions taken by Sellers or one of Sellers' Affiliates, or by 
Buyer or one of its Affiliates, or to consequences which are 
deemed to have occurred by operation of law as a result of the 
transactions contemplated herein, (ii) all liabilities under all 
union and labor contracts to the extent related to Storz 
Employees (Employees covered by collective bargaining agreements 
shall be provided with such benefits as shall be required under 
the terms of any applicable collective bargaining agreement), and 
(iii) all benefit and similar liabilities to inactive and former 
employees of the Companies, including individuals who are or have 
been on long-term disability leave or who have terminated 
employment, who retired or died through the Closing Date.  Buyer 
agrees to maintain such plans and benefits set forth in Section 
9.4.1(i) for a period of one year measured from the Closing Date. 
 Nothing in this Agreement shall prohibit Buyer from causing such 
plans or benefits set forth in Section 9.4.1(i) to be amended or 
terminated following such one-year period, and nothing in this 
Agreement shall prohibit Buyer from negotiating changes to the 
union and labor contracts following the Closing Date.  At the 
expiration of the one-year period following the Closing Date, 
Buyer shall provide the Storz Employees with Plans and benefits 
no less favorable than those offered to similarly situated 
employees of Buyer.
 
ARTICLE 9.4.2   With respect to Cyanamid Storz 
Employees, Buyer shall, for a period of one year from the Closing 
Date, provide or cause an Affiliate of Buyer to provide each such 
Employee with either (i) substantially equivalent benefits, 
programs and policies to those benefits, programs and policies 
provided to similarly situated employees of Buyer or its 
Affiliates or (ii) benefits, programs and policies substantially 
equivalent to those benefits, programs and policies provided by 
Sellers to such employees as of the date hereof; provided, 
however, that in the event such employee has received stock 
option grants from Sellers in the past, and similarly situated 
employees of Buyer would not receive stock options under Buyer's 
Stock Option Plan, Buyer may provide for replacement benefits 
having comparable value to such employee's stock option benefit. 
 At the expiration of the one-year period following the Closing 
Date, if Buyer or its Affiliates provided benefits to the 
Cyanamid Storz Employees in accordance with Section 9.4.2(i), 
Buyer shall, or shall cause an Affiliate of Buyer, to provide 
future benefits, programs and policies to such employees which 
are no less favorable than those offered to similarly situated 
employees of Buyer.
 
ARTICLE 9.4.3   Buyer maintains retirement plans and 
savings plans for its employees (respectively, "Buyer's U.S. 
Retirement Plans" and "Buyer's U.S. Savings Plans").  Buyer 
shall recognize Cyanamid Storz Employees' service with Sellers or 
their Affiliates for purposes of determining retirement and 
savings plan eligibility to participate, vesting of benefits, 
service requirements for disability, subsidized early retirement 
and pre-retirement death benefits under any Buyer's U.S. 
Retirement Plans and Buyers U.S. Savings Plans in which such 
Employees participate, but not for benefit accrual purposes under 
Buyer's U.S. Retirement Plans.  Sellers maintain a qualified 
defined benefit pension plan, the American Home Products 
Corporation Retirement Plan - United States ("Sellers' U.S. 
Retirement Plan").  Sellers agree to amend Sellers' U.S. 
Retirement Plan to provide that with respect to benefits accrued 
by Cyanamid Storz Employees under Sellers' U.S. Retirement Plan 
through the Closing Date, the Employees' period of service with 
Buyer shall be taken into account for purposes of determining 
eligibility for subsidized early retirement benefits and vesting 
under Sellers' U.S. Retirement Plan.  Sellers maintain a 
qualified savings plan, the American Home Products Corporation 
Savings Plan ("Sellers' U.S. Savings Plan").  Sellers agree to 
amend Sellers' U.S. Savings Plan to provide that Cyanamid Storz 
Employees are fully vested in their account balances as of the 
Closing Date.
 
ARTICLE 9.4.4   With respect to the Cyanamid Storz 
Employees, Sellers shall retain liability under any group life, 
accident, worker's compensation, medical, hospitalization, 
prescription drug, dental or disability plan, whether or not 
insured, for any claims incurred through the Closing Date, and 
Buyer shall assume all liability for claims arising after the 
Closing Date under its group life, accident, worker's 
compensation, medical, hospitalization, prescription drug, dental 
or disability plan.  For purposes of this Section 9.4.4 claims 
shall be deemed to have arisen:
 
 			(a)  With respect to all death or dismemberment 
claims, on the actual date of death or dismemberment;
 
 			(b)  With respect to disability or salary 
continuance claims, on the day the claimant became disabled or 
otherwise entitled to salary continuation;
 
 			(c)  With respect to all hospital, medical, drug 
or dental claims, on the date the service or supply was purchased 
or received by the claimant; and
 
 			(d)  With respect to worker's compensation claims 
which are single accident specific, on the-date of the 
occurrence, and with respect to all other worker's compensation 
claims, on the date the award is made.
 
ARTICLE 9.4.5   Buyer and its Affiliates maintain 
medical, hospitalization, dental, prescription drug, death, life 
insurance, accidental death and dismemberment, short-term 
disability and long-term disability benefit plans for its 
employees covered by this Section 9.4.5 ("Buyer's U.S. Welfare 
Plans").  Immediately after the Closing Date, all Cyanamid Storz 
Employees shall participate in those Buyer's U.S. Welfare Plans 
applicable to each such Employee's business unit in accordance 
with the terms of such plans, and employment with Sellers or 
their Affiliates will be taken into account for purposes of 
determining eligibility to participate and benefits under Buyer's 
U.S. Welfare Plans; provided, however, that
 
 			(a)  Cyanamid Storz Employees shall participate 
under the applicable Buyer's U.S. Welfare Plans immediately after 
the Closing Date without any waiting periods, without evidence of 
insurability, and without application of any pre-existing 
physical or mental condition limitations except to the extent 
applicable under similar plans maintained by Sellers; and
 
 			(b)  Buyer shall count claims arising through the 
Closing Date for purposes of satisfying deductibles, out-of 
pocket maximums, and all other similar limitations.
 
ARTICLE 9.4.6   Sellers maintain a program of medical 
and life insurance benefits for certain retired employees 
("Sellers' U.S. Retiree Welfare Plans").  Any Cyanamid Storz 
Employee who has met the eligibility requirements for benefits 
under Sellers' U.S. Retiree Medical Plan through the Closing Date 
will be entitled to benefits in accordance with the terms of 
Sellers' U.S. Retiree Medical Plan as in effect from time to time 
upon termination of employment with Buyer and loss of coverage as 
an active employee under Buyer's group health plan.  Buyer shall 
recognize service with Sellers for purposes of its retiree 
medical plan for those Cyanamid Storz Employees who are not 
eligible for the Sellers' U.S. Retiree Welfare Plans as of the 
Closing Date.
 
ARTICLE 9.4.7   Buyer shall be responsible for any 
legally mandated continuation of health care coverage for all 
Cyanamid Storz Employees and/or their covered dependents who have 
a loss of health care coverage due to a qualifying event (as 
defined in Section 4980B of the Code) that occurs after the 
Closing Date.
 
ARTICLE 9.5 	International Employees of the European 
Union ("EU").
 
ARTICLE 9.5.1   Notwithstanding Section 9.3.1(b), 
Sellers and Buyer accept and agree that the transfer of 
employment of the International Employees in the EU countries 
(hereinafter referred to as "European Employees") will be 
effected and governed by the Transfer Provisions and accordingly 
the contract of employment of each European Employee shall be 
assumed by Buyer or its Affiliate with effect from the Closing 
Date which shall be the "time of transfer" under the Transfer 
Provisions.
 
ARTICLE 9.5.2   Buyer shall ensure that its Affiliates 
(where necessary) comply with their respective obligations under 
the Transfer Provisions and upon request provide Seller or the 
relevant Sellers' Affiliate with such information as will enable 
either Seller or its Affiliate, as the case may be, to carry out 
its duties under the Transfer Provisions concerning measures to 
effectuate the transfer of the European Employees to Buyer.
 
ARTICLE 9.5.3   The following terms as used herein shall 
have the following meanings:
 
 			(a)  "European Employees" means all those 
Employees of Sellers and their Affiliates employed in the 
Business within the EU; and
 
 			(b)  "Transfer Provisions" means any legislation 
implementing the provisions of directive 77/187/EEC commonly 
called the Acquired Rights Directive or Transfer of Undertakings 
Directive.
 
ARTICLE 9.6 	Treatment of Sellers' International Plans.
 
ARTICLE 9.6.1   Storz GmbH Plans and Chirurgie Plans, 
as listed in Section 9.6.1 of the Disclosure Schedule, shall be 
retained or assumed by the Companies and Buyer and unless 
otherwise required by Applicable Law, the Companies and Buyer 
agree to maintain such plans for a period of one year from the 
Closing Date, At the expiration of the one-year period following 
the Closing Date, Buyer shall provide the Storz GmbH Employees 
and the Chirurgie Employees with plans and benefits no less 
favorable than those provided to similarly situated employees of 
the Buyer.  The Companies and Buyer shall retain or assume, as 
the case may be, all benefits and similar liabilities to inactive 
or former employees of Storz GmbH or a predecessor company, and 
Chirurgie or a predecessor company, including any individuals who 
are or have been on long-term disability leave or who have 
terminated their employment, retired or died on or before the 
Closing Date.  With respect to the Storz GmbH defined benefit 
plan, all assets and liabilities shall remain attributable to the 
plan and shall be retained by Storz GmbH.  However, in the event 
that the book reserve established for the Storz GmbH defined 
benefit plan is less than the liabilities determined as of the 
most recent valuation date prior to the Closing Date plus a pro-
rated accrual of liabilities for the period between such 
valuation date and the Closing Date, Sellers shall pay to Buyer 
such deficiency, as an adjustment to the Purchase Price, in the 
manner and with interest as provided in Section 3.6.2.  In the 
event that the book reserve established for the Storz GmbH 
defined benefit plan exceeds the liabilities determined as of the 
most recent valuation date, Buyer shall pay Sellers an amount 
equal to such excess in the manner and with interest as provided 
in Section 3.6.2.  For this purpose, the book reserve and the 
liabilities shall be based on reasonable actuarial assumptions 
and generally accepted valuation methods as determined by 
Sellers' actuary subject to review and reasonable approval of 
Buyer's actuary (not to be unreasonably withheld).  In the event 
of a dispute, the provisions of Section 9.6.2 with respect to the 
appointment of an independent third party shall apply. Sellers 
shall provide Buyer with an accounting under this Section 9.6.1 
within sixty (60) days after the Closing Date.  Any adjustment 
required hereunder shall be made within thirty (30) days after 
the accounting is issued by Sellers, unless the Buyer objects to 
the calculation in which case the adjustment shall be made within 
thirty (30) days after the independent actuary renders an opinion 
pursuant to Section 9.6.2.
 
ARTICLE 9.6.2   Except as expressly set forth in Section 
9.6.1, this Section 9.6.2, or as required by Applicable Law, no 
assets of any International Plan shall be transferred to Buyer or 
any of its Affiliates or to any plan of Buyer or any of its 
Affiliates.  With respect to any International Plans as to which 
the Companies are the plan sponsor and which cover solely 
International Employees, Buyer shall assume, or cause its 
Affiliates to assume, the assets and liabilities of such plans 
with respect to the International Employees.  Buyer shall also 
assume, or cause its Affiliates to assume, the assets and 
liabilities of any defined contribution or individual account 
plan maintained by Sellers or the Companies for the benefit of 
the International Employees and Seller shall cause any such plan 
to be amended to provide that the International Employees' 
account balances thereunder are fully vested as of the Closing 
Date.  With respect to any defined benefit plan which is required 
under Applicable Law to transfer assets and liabilities to Buyer, 
the assets and liabilities to be transferred shall be based on 
reasonable actuarial assumptions and generally accepted valuation 
methods as determined by Sellers' actuary subject to the review 
of Buyer's actuary.  In the event the actuaries are unable to 
agree on the valuation of the assets and liabilities, the parties 
shall appoint an independent third party actuary to act as an 
expert.  If the parties can not agree on an independent third 
party actuary, one shall be appointed by the Institute of 
Actuaries in London.  The parties shall share the cost arising 
from the appointment of such independent third party.  Sellers 
shall take whatever action is reasonably required to ensure that 
such plans and arrangements and all related plan assets or 
reserves are maintained by, and subject to the control of, the 
Companies on or prior to the Closing Date.
 
ARTICLE 9.6.3   Buyer shall recognize each International 
Employee's service with Sellers and Sellers' Affiliates for 
purposes of determining retirement and savings plan eligibility 
for participation, vesting of benefits, and service requirements 
for disability, subsidized early retirement and pre-retirement 
death benefits under the appropriate international retirement and 
savings plans of Buyer and its Affiliates, but not benefit 
accrual purposes under the appropriate international retirement 
plan of Buyer and its Affiliates.  With respect to International 
Plans which provide group life, accident, medical 
hospitalization, prescription drug, dental or disability 
benefits, and with respect to International Plans or arrangements 
providing benefits in the nature of worker's compensation, 
liabilities for claims through and after the Closing Date shall 
be allocated between Buyer and Sellers in the manner set forth in 
Section 9.6.4.  International Employees' participation in the 
appropriate international welfare plans of Buyer and its 
Affiliates, where available, shall be on the basis as set forth 
in Section 9.6.5.
 
ARTICLE 9.6.4   With respect to all International 
Employees, excluding Storz GmbH Employees, Sellers shall retain 
liability under any group life, accident, worker's compensation, 
medical, hospitalization, prescription drug, dental or disability 
plan, whether or not insured, for any claims incurred through the 
Closing Date and Buyer shall retain or assume, as the case may 
be, all liability for claims arising after the Closing Date under 
any group life, accident, worker's compensation, medical, 
hospitalization, prescription drug, dental or disability plan.  
For purposes of this Section 9.6.4, claims shall be deemed to 
have arisen:
 
 			(a)  with respect to all death or dismemberment 
claims, on the actual date of death or dismemberment;
 
 			(b)  with respect to disability or salary 
continuance claims, on the day the claimant became disabled or 
otherwise entitled to salary continuation;
 
 			(c)  with respect to all hospital, medical, drug 
or dental claims, on the date the service or supply was purchased 
or received by the claimant; and
 
 			(d)  with respect to worker's compensation claims 
which are single accident specific, on the date of the 
occurrence, and with respect to all other worker's compensation 
claims, on the date the award is made.
 
ARTICLE 9.6.5   Buyer and its Affiliates maintain 
medical, hospitalization, dental, prescription drug, death, life 
insurance, accidental death and dismemberment, short-term 
disability and long-term disability benefit plans ("Buyer's 
International Welfare Plans") for its non-U.S., employees.  
Immediately after the Closing Date, all International Employees, 
other than the Chirurgie Employees and the Storz GmbH Employees 
covered by Section 9.6.1, shall participate in the appropriate 
Buyer's International Welfare Plans applicable to such Employee's 
business unit with Buyer and its Affiliates in accordance with 
the terms of such plans, and employment with any of the Companies 
and its Affiliates shall be taken into account for purposes of 
determining eligibility for participation and benefits under the 
applicable Buyer's International Welfare Plans; provided, 
however, that (i) International Employees shall participate under 
Buyer's International Welfare Plans immediately after the Closing 
Date without any waiting periods, without any evidence of 
insurability, and without application of any pre-existing 
physical or mental condition limitations, except to the extent 
applicable under Sellers' International Plans, and (ii) Buyer 
shall count claims arising through the Closing Date for purposes 
of satisfying deductibles, out-of-pocket maximums, and other 
similar limitations.
 
ARTICLE 9.7 	No Third Party Beneficiaries.  No provision 
of this Agreement shall create any third party beneficiary or 
other rights in any Employee (including any beneficiary or 
dependent thereof) or any persons in respect of continued 
employment with any of the Companies, with Sellers, or with any 
of their Affiliates and no provision of this Agreement shall 
create any such rights in any such persons in respect of any 
benefits that may be provided, directly or indirectly, under any 
U.S. Employee Plan or U.S. Benefit Arrangement, any International 
Plan or any plan or arrangement which may be established by Buyer 
or any of its Affiliates.  No provision of this Agreement shall 
constitute a limitation on the right of Buyer, any of the 
Companies or any Affiliates of Buyer to terminate any Employee at 
will.
 
 
ARTICLE 10 
 	TERMINATION, AMENDMENT AND WAIVER
 
ARTICLE 10.1 	Termination.  This Agreement may be 
terminated at any time prior to the Closing Date:
 
ARTICLE 10.1.1   by mutual consent of Buyer and Sellers;
 
ARTICLE 10.1.2   by Buyer or Sellers if the Closing 
shall not have occurred on or prior to February 28, 1997, 
provided, however, that the right to terminate under this Section 
10.1.2 shall not relieve any party whose failure to fulfill any 
obligation under this Agreement has been the cause of, or 
resulted in the failure of the Closing to occur on or before such 
date of any liability of such party to the other party hereunder 
for such failure;
 
ARTICLE 10.1.3   subject to Section 7.5, by Buyer or 
Sellers if a court of competent jurisdiction or governmental, 
regulatory or administrative agency or commission shall have 
issued an order, decree or ruling or taken any other action, in 
each case permanently restraining, enjoining or otherwise 
prohibiting the transactions contemplated by this Agreement, and 
such order, decree, ruling or other action shall have become 
final and nonappealable;
 
ARTICLE 10.1.4   by Sellers upon written notice to Buyer 
if any event occurs which would render impossible the 
satisfaction and capability of curing of one or more conditions 
to the obligation of Sellers to consummate the transactions 
contemplated by this Agreement as set forth in Section 8.2.1 or 
8.2.2; or
 
ARTICLE 10.1.5   by Buyer upon written notice to Sellers 
if any event occurs which would render impossible the 
satisfaction and capability of curing of one or more conditions 
to the obligation of Buyer to consummate the transactions 
contemplated by this Agreement as set forth in Section 8.3.1 or 
8.3.2.
 
 		The date on which this Agreement is terminated pursuant 
to any of the foregoing subsections of this Section 10.1 is 
herein referred to as the "Termination Date."
 
ARTICLE 10.2 	Effect of Termination.  Upon the 
termination of this Agreement pursuant to Section 10.1, all 
further obligations of the parties under this Agreement shall 
terminate without further liability of any party to the others, 
except that the obligations under Sections 7.2 and 7.4 shall 
survive any such termination, and except that nothing herein 
shall relieve any party from liability for breach of any 
provision of, or for any misrepresentation under this Agreement, 
or be deemed to constitute a waiver of any available remedy for 
any such breach or misrepresentation.
 
 
ARTICLE 11 
 	INDEMNIFICATION
 
ARTICLE 11.1 	Indemnification.
 
ARTICLE 11.1.1   From and after Closing, except with 
respect to any claim related to Taxes for which Section 7.7 of 
this Agreement shall provide the sole and exclusive basis of 
indemnity to Buyer, and subject to Section 11.3, Sellers shall 
indemnify, defend and hold harmless Buyer, the Companies and 
their respective Affiliates, officers, directors, employees and 
controlling Persons from any liability, damage, deficiency, loss, 
judgments, assessments, cost or expense, including reasonable 
attorneys' fees and costs of investigating and defending against 
lawsuits, complaints, actions or other pending or threatened 
litigation (collectively, "Costs") (Costs shall not include any 
Cost which has been reflected in the adjustment to the Purchase 
Price pursuant to Section 3.6 hereof), arising from or 
attributable to:
 
 			(a)  the breach of any representation or warranty 
made by Sellers in this Agreement;
 
 			(b)  any failure of Sellers duly to perform or 
observe any covenant or agreement to be performed or observed by 
Sellers pursuant to this Agreement;
 
 			(c)  the Excluded Liabilities and Excluded Assets;
 
 			(d)  any failure by Sellers or the International 
Affiliates to comply with any applicable bulk sales, fraudulent 
conveyance or other Law for the protection of creditors;
 
 			(e)  product liability claims against the 
Companies relating to occurrences of injuries prior to Closing 
caused by a product of the Business;
 
 			(f)  any obligation to indemnify Dow Corning for 
liabilities relating to pre-closing purchases and sales arising 
out of the Supply Agreement dated September 1, 1996 between 
Cyanamid and Dow Corning;
 
 			(g)  any obligation to indemnify Sparta 
Maxillofacial Products, Inc. ("Sparta") arising out of the 
Asset Purchase Agreement dated January 20, 1994 between Sparta 
and Storz, except due to the breach of any covenant or agreement 
by Storz or its Affiliates after Closing;
 
 			(h)  any obligation to indemnify Global Surgical 
Corp. ("Global") arising out of the Asset Purchase Agreement 
dated January 31, 1994 between Global, Storz and Surgical 
Mechanical Research, Inc., except due to the breach of any 
covenant or agreement by Storz or its Affiliates after Closing; 
and
 
 			(i)  any liability arising out of or attributable 
to the Companies' sale of breast implants on behalf of Dow 
Corning to the extent Dow Corning fails to indemnify Storz for 
any liability relating to the sale of breast implants prior to 
Closing; and
 
 			(j)  any liability relating to a claim asserted by 
Tree Court Associates, L.P. ("Landlord") by letter dated 
January 31, 1994, for alleged failure to maintain in good 
condition and order the premises subject to a lease dated 
December 31, 1985 between Storz and Landlord (which premises are 
currently subject to a sublease with Global Surgical Corp.); and
 
 			(k)  any liabilities relating to cochlear ear 
implants implanted in patients by Storz or its Affiliates prior 
to Closing pursuant to an FDA approved IDE relating to (i) 
maintenance or service of such implants to patients, (ii) 
removal/replacement of such implants in patients, and (iii) 
product liability claims relating to such implants in all such 
cases only to the extent such liability exceeds the reserve 
established for such item on the Closing Statement.
 
 			(l)  50% of any Assumed Liabilities which arise or 
may arise from the transfer of the International Assumed 
Contracts to Buyer or any from any termination of such 
International Assumed Contracts, in each case by operation of 
Applicable Law as a result of the transactions contemplated 
herein (but not by action of Buyer), to the extent such 
liabilities exceed $500,000.
 
ARTICLE 11.1.2   Except with respect to any claim 
related to Taxes for which Section 7.7 of this Agreement shall be 
the sole and exclusive basis of indemnity to Sellers, Buyer shall 
indemnify and hold harmless Sellers, their officers, directors, 
employees and Affiliates from Costs arising from or attributable 
to:
 
 			(a)  the breach of any representation or warranty 
made by Buyer in this Agreement;
 
 			(b)  any failure of Buyer duly to perform or 
observe any covenant or agreement to be performed or observed by 
Buyer pursuant to this Agreement;
 
 			(c)  the Assumed Liabilities; 
 
 			(d)  AHP's guaranty of Storz's indemnification 
obligation under the agreement with Dow Corning Corporation, 
referred to in Section 7.20 for all periods following the 
Closing; and 
 
 			(e)  Cyanamid's continuing obligation as assignor 
of the agreement with Gilead Sciences referred to in Section 
7.21.
 
 			(f)  except for the matters for which Sellers 
would be obligated to indemnify Buyer against under this 
Agreement, all post-Closing liabilities of the Companies and all 
post-Closing liabilities arising out of, or relating primarily 
to, the Business.
 
ARTICLE 11.1.3   Sellers and Buyer shall indemnify the 
other for all Taxes for the periods and in the manner described 
in Section 7.7.
 
ARTICLE 11.2 	Procedures.
 
ARTICLE 11.2.1   Promptly after the receipt by any 
Person entitled to indemnity hereunder of notice under this 
paragraph 11.2, of any third party claim, suit, action or 
proceeding (a "Third Party Claim"), such Person (the 
"Aggrieved Party") will, if a claim for indemnification with 
respect thereto is to be made against any party obligated to 
provide indemnification pursuant to Article 11 (the 
"Indemnifying Party"), give such Indemnifying Party written 
notice of such Third Party Claim and shall permit the 
Indemnifying Party to assume the defense of any such Third Party 
Claim, and, upon such assumption, shall cooperate fully with the 
Indemnifying Party in the conduct of such defense; provided, 
however, that any failure to provide such notice shall not 
constitute a waiver of the Indemnifying Party's indemnity 
obligations hereunder except to the extent the Indemnifying Party 
is actually prejudiced in defense of a Third Party Claim against 
the Aggrieved Party.  The Indemnifying Party shall have the 
right, within 12 business days of receipt of notice thereof, to 
assume and control the defense and settlement of such Third Party 
Claim at the Indemnifying Party's sole cost and expense [and with 
counsel reasonably satisfactory to the Aggrieved Party]; 
provided, however, that the Indemnifying Party will not have the 
right to assume the defense of any Third Party Claim that seeks 
criminal penalties.  If the Indemnifying Party assumes the 
defense of any such Third Party Claim, the Aggrieved Party may 
participate in, but not control, at its expense, the defense of 
such Third Party Claim.  The Indemnifying Party shall not, in the 
defense of such Third Party Claim, consent to entry of any 
judgment, except with the written consent of the Aggrieved Party, 
or enter into any settlement, except with the written consent of 
the Aggrieved Party, which does not include as an unconditional 
term thereof the giving by the claimant or the plaintiff to the 
Aggrieved Party of a release from all liability in respect of 
such Third Party Claim.  All awards and costs payable by a third 
party to the Aggrieved Party or the Indemnifying Party shall 
belong to the Indemnifying Party.
 
ARTICLE 11.2.2   If the Indemnifying Party shall not 
assume the defense of any such Third Party Claim, the Aggrieved 
Party may defend and settle such Third Party Claim in such manner 
as it may deem appropriate and, unless the Indemnifying Party 
shall deposit with the Aggrieved Party a sum equivalent to the 
total amount demanded (subject to the applicable limitation set 
forth in Section 11.3) in such Third Party Claim less the Minimum 
Loss to the extent not incurred already by the Aggrieved Party, 
or shall deliver to the Aggrieved Party a surety bond in form and 
substance reasonably satisfactory to the Aggrieved Party in such 
amount, the Aggrieved Party may settle such Third Party Claim on 
such terms as it may deem appropriate, and the Indemnifying Party 
shall promptly reimburse the Aggrieved Party for the amount of 
all expenses, legal or otherwise, incurred by the Aggrieved Party 
in connection with the defense against or settlement of such 
Third Party Claim minus the Minimum Loss to the extent not 
incurred already by the Aggrieved Party.  If no settlement of 
such Third Party Claim is made, the Indemnifying Party shall 
promptly reimburse the Aggrieved Party for the amount of any 
judgment rendered with respect to such Third Party Claim and of 
all expenses, legal or otherwise, incurred by the Aggrieved Party 
in the defense against such Third Party Claim.
 
ARTICLE 11.2.3   If there shall be any conflicts between 
the provisions of this Section 11.2 and Section 7.7.3 (relating 
to Tax contests), the provisions of Section 7.7.3 shall control 
with respect to Tax contests.
 
ARTICLE 11.3 	Limitations.  An Aggrieved Party shall 
not be entitled to recover any Costs under Section 11.1(a), 
11.1(b), 11.1(d) until the aggregate amount of the Costs suffered 
by the Aggrieved Party thereunder shall exceed $5 million (the 
"Minimum Loss"), at which time the indemnification provided 
under Section 11.1 shall apply to all Costs in excess of the 
Minimum Loss, and the maximum liability under Section 11.1 for an 
Indemnifying Party shall not exceed in the aggregate $100 
million.  Notwithstanding anything to the contrary contained 
herein, a party shall not be entitled to indemnification under 
this Article 11 with respect to any matter to the extent a 
purchase price adjustment has been made with respect thereto 
pursuant to Section 3.6.
 
ARTICLE 11.4 	Indemnification as Sole Remedy.  The 
indemnification provided in this Article 11 and Article 7, 
subject to the limitations set forth herein, shall be the 
exclusive post-Closing remedy for damages available to any 
Aggrieved Party.
 
ARTICLE 11.5 	Survival.  Notwithstanding the 
provisions of Section 12.3, any matter as to which a claim has 
been asserted by notice to the other party that is pending or 
unresolved at the end of any applicable limitation period or on 
any applicable expiration date of such party's indemnity 
obligations hereunder shall continue to be covered by this 
Article 11 notwithstanding any applicable expiration of any 
party's indemnity obligations set forth in this Article 11 until 
such matter is finally terminated or otherwise resolved by the 
parties or by a court of competent jurisdiction and any amounts 
payable hereunder are finally determined and paid.
 
 
ARTICLE 12 
 	GENERAL PROVISIONS
 
ARTICLE 12.1 	Public Statements.  Prior to the 
Closing, or afterward, so long as this Agreement is in effect, 
none of the parties hereto shall issue or cause the publication 
of any press release or other announcement with respect to this 
Agreement or the transactions contemplated hereby without 
consulting with and obtaining the consent of the other party; 
provided, however, that such consent shall not be required where 
such release or announcement is required by applicable law.
 
ARTICLE 12.2 	Notices.  All notices and other 
communications hereunder shall be in writing and shall be deemed 
to have been duly given if delivered personally, mailed by 
reputable overnight courier or certified mail (return receipt 
requested) or sent by telecopier (confirmed thereafter by such 
certified mail) to the parties at the following addresses or at 
such other addresses as shall be specified by the parties by like 
notice:
 
ARTICLE 12.2.1 	if to Sellers:
 
 			c/o American Home Products Corporation
 			Five Giralda Farms 
 			Madison, New Jersey 07940 
 			Attention:  Chief Financial Officer
 			Telecopier Number:  (201) 660-7156
 
 			with a copy to:
 
 			American Home Products Corporation
 			Five Giralda Farms
 			Madison, New Jersey 07940
 			Attention:	Senior Vice President and
 							General Counsel
 			Telecopier Number:  (201) 660-6030
 
ARTICLE 12.2.2 	if to Buyer:
 
 			Bausch & Lomb Incorporated
 			One Bausch & Lomb Place
 			Rochester, New York  14604
 			Attention:  Chief Executive Officer
 			Telecopier Number:  (716) 338-6805
 
 			with a copy  to:
 
 			Bausch & Lomb Incorporated
 			One Bausch & Lomb Place
 			Rochester, New York  14604
 			Attention:  General Counsel
 			Telecopier Number:  (716) 338-8706
 
 
 Notice so given shall (in the case of notice so given by mail) be 
deemed to be given and received on the third calendar day after 
mailing or the next business day if sent by a reputable overnight 
courier and (in the case of notice so given by telecopier or 
personal delivery) on the date of actual transmission or (as the 
case may be) personal delivery.
 
ARTICLE 12.3 	Survival of Representations and 
Warranties.  The respective representations and warranties of the 
parties hereto shall survive the Closing and shall remain in full 
force and effect, provided, however, that (i) the representations 
and warranties in Sections 4.7 shall survive until the applicable 
statute of limitations has run, (ii) the representations and 
warranties in Section 4.14 shall survive until the third 
anniversary of the Closing Date, and (iii) all other 
representations and warranties shall expire on March 31, 1999.
 
ARTICLE 12.4 	Amendment.  This Agreement may not be 
amended except by an instrument in writing signed on behalf of 
each of the parties hereto.
 
ARTICLE 12.5 	Waiver.  At any time prior to the 
Closing, any term, provision or condition of this Agreement may 
be waived in writing (or the time for performance of any of the 
obligations or other acts of the parties hereto may be extended) 
by the party that is entitled to the benefits thereof.
 
ARTICLE 12.6 	Parties In Interest.  Except as 
contemplated hereunder, this Agreement may not be assigned by a 
party without the prior written consent of the other parties 
hereto.  This Agreement shall not run to the benefit of or be 
enforceable by any person other than a party to this Agreement 
and, subject to the first sentence of this Section, its 
successors and assigns.
 
ARTICLE 12.7 	Interpretation.  When a reference is 
made in this Agreement to an Article, Section, Exhibit or 
Disclosure Schedule, such reference is to an Article or Section 
of, or an Exhibit or Disclosure Schedule to, this Agreement 
unless otherwise indicated.  The table of contents and headings 
contained in this Agreement are for reference purposes only and 
shall not affect in any way the meaning or interpretation of this 
Agreement.  For all purposes of this Agreement, except as 
otherwise expressly provided or unless the context otherwise 
requires, (i) the terms defined include the plural as well as the 
singular, (ii) the words "herein," "hereof" and "hereunder" 
and other words of similar import refer to this Agreement as a 
whole and not to any particular Article, Section or other 
subdivision.
 
ARTICLE 12.8 	Sellers' Knowledge.  When "to the 
knowledge of Sellers" or similar phrase is used herein it shall 
refer to the actual knowledge of Sellers and to the individuals 
employed by Affiliates of Sellers contained in Section 12.8 of 
the Disclosure Schedule.
 
ARTICLE 12.9 	Miscellaneous.  This Agreement 
(including the Disclosure Schedule, the Exhibits and the 
agreement identified in Section 7.4) constitutes the entire 
agreement and supersedes all other prior agreements and 
undertakings, both written and oral, among the parties, or any of 
them, with respect to the subject matter hereof; is not intended 
to confer upon any other person any rights or remedies hereunder; 
and shall be governed in all respects, including validity, 
interpretation and effect, by the internal laws of the State of 
New York without giving effect to the principles of conflicts of 
laws thereunder.  This Agreement may be executed in one or more 
counterparts which together shall constitute a single agreement. 
 If any provisions of this Agreement shall be held to be illegal, 
invalid or unenforceable under any applicable law, then such 
contravention or invalidity shall not invalidate the entire 
Agreement.  Such provision shall be deemed to be modified to the 
extent necessary to render it legal, valid and enforceable, and 
if no such modification shall render it legal, valid and 
enforceable, then this Agreement shall be construed as if not 
containing the provision held to be invalid, and the rights and 
obligations of the parties shall be construed and enforced 
accordingly.
 
 		IN WITNESS WHEREOF, the parties hereto have caused this 
Agreement to be executed as of the date first written above.
 
 
 						AMERICAN HOME PRODUCTS CORPORATION
 
 
 						By: 	
 						   Name:
 						   Title:
 
 
 						AMERICAN CYANAMID COMPANY
 
 
 						By: 	
 						   Name:
 						   Title:
 
 
 						BAUSCH & LOMB INCORPORATED
 
 
 						By: 	
 						   Name:
 						   Title:
 

 
                           PURCHASE AGREEMENT
 
                               by and among
 
                        AMERICAN CYANAMID COMPANY
 
                   AMERICAN HOME PRODUCTS CORPORATION
 
                                  and
 
                        BAUSCH & LOMB INCORPORATED