INNOTECH INC, SC 14D9, 1997-02-18

INNOTECH INC
SC 14D9, 1997-02-18
OPTICAL INSTRUMENTS & LENSES

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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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SCHEDULE 14D-9

SOLICITATION/RECOMMENDATION STATEMENT
PURSUANT TO SECTION 14(d)(4)
OF THE SECURITIES EXCHANGE ACT OF 1934

INNOTECH, INC.
(NAME OF SUBJECT COMPANY)

INNOTECH, INC.
(NAME OF PERSON(S) FILING STATEMENT)

COMMON STOCK, PAR VALUE $.001 PER SHARE
(TITLE OF CLASS OF SECURITIES)

45766M 10 0
(CUSIP NUMBER OF CLASS OF SECURITIES)

STEVEN A. BENNINGTON
PRESIDENT AND CHIEF OPERATING OFFICER
INNOTECH, INC.
5568 AIRPORT ROAD
ROANOKE, VIRGINIA 24012
(NAME, ADDRESS AND TELEPHONE NUMBER OF PERSONS AUTHORIZED TO RECEIVE
NOTICE AND COMMUNICATIONS ON BEHALF OF THE PERSON(S) FILING STATEMENT)

COPY TO:

STEPHEN R. CONNONI, ESQ.
HERTZOG, CALAMARI & GLEASON
100 PARK AVENUE
NEW YORK, NEW YORK 10017
(212) 481-9500

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ITEM 1. SECURITY AND SUBJECT COMPANY.

The name of the subject company is Innotech, Inc., a Delaware corporation
(the "Company"). The address of the principal executive offices of the Company
is 5568 Airport Road, Roanoke, Virginia 24012. The title of the class of equity
securities to which this Solicitation/Recommendation Statement on Schedule 14D-9
(the "Schedule 14D-9" or the "Statement") relates is the common stock, par value
$.001 per share, of the Company (the "Common Stock").

ITEM 2. TENDER OFFER OF THE PURCHASER.

This Statement relates to a tender offer by INO Acquisition Corp., a
Delaware corporation (the "Purchaser") and a wholly owned subsidiary of Johnson
& Johnson, a New Jersey corporation (the "Parent"), disclosed in a Tender Offer
Statement on Schedule 14D-1, dated February 18, 1997 (the "Schedule 14D-1"), to
purchase all outstanding shares of Common Stock (the "Shares") at a price of
$13.75 per Share, net to sellers in cash, without any interest, upon the terms
and subject to the conditions set forth in the Purchaser's Offer to Purchase,
dated February 18, 1997 (the "Offer to Purchase"), and the related Letter of
Transmittal (which together constitute the "Offer").

The Offer is being made pursuant to an Agreement and Plan of Merger, dated
as of February 10, 1997 (the "Merger Agreement"), among the Parent, the
Purchaser and the Company, a copy of which is attached hereto as Exhibit A and
incorporated herein by reference. Pursuant to the Merger Agreement, as soon as
practicable after consummation of the Offer and satisfaction of the other
conditions specified in the Merger Agreement, the Purchaser will be merged with
and into the Company (the "Merger"), and the Company will continue as the
surviving corporation and become a wholly owned subsidiary of the Parent (the
"Surviving Corporation").

All references in this Schedule 14D-9 to the Merger Agreement and to the
transactions contemplated thereby are to the Merger Agreement and to such
transactions as contemplated by the Merger Agreement, as presently in effect,
and not as it may be subsequently amended by the Company's Board of Directors
(the "Board") as reconstituted upon the purchase of Shares by the Purchaser
pursuant to the Offer. See ITEM 3(b)(1) "THE MERGER AGREEMENT -- Board
Representation" and "-- Amendment of Merger Agreement."

All information contained in this Statement or incorporated herein by
reference concerning the Purchaser, the Parent or their affiliates, or actions
or events with respect to any of them, was provided by the Purchaser or the
Parent and the Company takes no responsibility for the accuracy or completeness
of such information or for any failure by such entities to disclose events or
circumstances that may have occurred and may affect the significance,
completeness or accuracy of any such information.

Based on information in the Offer to Purchase, the principal executive
offices of the Parent and the Purchaser are located at One Johnson & Johnson
Plaza, New Brunswick, New Jersey 08933.

ITEM 3. IDENTITY AND BACKGROUND.

(a) NAME AND ADDRESS OF THE COMPANY. The name of the Company, which is the
person filing this Statement, and the address of the principal executive offices
thereof, are set forth in Item 1 above.

(b) MATERIAL CONTRACTS. Except as described or referred to in the attached
Schedule I or set forth below, there exists no material contract, agreement,
arrangement or understanding and no actual or potential conflict of interest
between the Company or any of its affiliates and (1) the Company's executive
officers, directors or affiliates or (2) the Purchaser, its executive officers,
directors or affiliates.

(b)(1) THE MERGER AGREEMENT. A summary of the Merger Agreement is
contained on pages 14 through 20 of the Offer to Purchase. The Offer to
Purchase, a copy of which is enclosed with this Schedule 14D-9, has been filed
with the Securities and Exchange Commission (the "SEC") and is incorporated
herein by reference. The following summarizes certain provisions of the Merger
Agreement which relate to agreements and arrangements among the Company, the
Purchaser (or the Parent) and the Company's
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executive officers and directors. The following summary is qualified in its
entirety by reference to the Merger Agreement. The Merger Agreement and the
summary thereof contained in the Offer to Purchase should each be read in its
entirety for a more complete understanding of the terms and provisions of the
Merger Agreement.

Board Representation. The Merger Agreement provides that, promptly upon
the acceptance for payment of, and payment for, Shares by the Purchaser pursuant
to and subject to the conditions of the Offer, the Purchaser shall be entitled
to designate such number of directors on the Board of the Company as will give
the Purchaser a majority of such directors, and the Company shall, at such time,
cause the Purchaser's designees to be so elected by its existing Board. The
Company has agreed to take all action requested by the Parent necessary to
effect such election and, at the Parent's option, to either increase the size of
the Company's Board and/or obtain the resignations of such number of its current
directors as is necessary to enable the Purchaser's designees to be elected or
appointed to, and to constitute a majority of, the Company's Board. The
Company's obligation to appoint designees to the Board is subject to Section
14(f) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
and Rule 14f-1 promulgated thereunder. In this regard, the Company has prepared
and filed with the SEC simultaneously herewith an Information Statement
containing the information required by such Section 14(f) (the "Information
Statement"), a copy of which is attached hereto as Schedule I.

Stock Option Plans and Warrants. The Merger Agreement provides that, as
soon as practicable following the date of the Merger Agreement and prior to the
consummation of the Offer, the Company shall ensure that, with certain
exceptions set forth in the Merger Agreement, each option to purchase Shares (a
"Company Stock Option") theretofore granted under any stock option, stock
appreciation rights or stock purchase plan, program or arrangement of the
Company (collectively, the "Stock Option Plans"), and each warrant to purchase
Shares (a "Warrant"), in each case outstanding immediately prior to the
consummation of the Offer, whether or not then exercisable, shall either (1) be
cancelled immediately prior to the effective date of the Merger (the "Effective
Time") in exchange for an amount in cash, payable at the time of such
cancellation, equal to the product of (x) the number of Shares subject to such
Company Stock Option or Warrant immediately prior to the Effective Time and (y)
the excess of the price per Share to be paid in the Offer over the per Share
exercise price of such Company Stock Option or Warrant (the "Net Amount") or (2)
be converted immediately prior to the Effective Time into the right solely to
receive the Net Amount. The Merger Agreement further provides that the Company
(or, if appropriate, the Board or any committee thereof administering the Stock
Option Plans) shall use its reasonable best efforts to ensure that immediately
prior to the Effective Time any Company Stock Options and Warrants then
remaining are cancelled or converted as set forth above. The Company shall not
make, or agree to make, payments of any kind to any holder of a Company Stock
Option or a Warrant (except for the payment described above) without the consent
of the Parent (which consent may not be unreasonably withheld).

Continuation of Benefits. The Parent has agreed in the Merger Agreement to
cause the Surviving Corporation to take such actions as are necessary so that,
for a period of not less than one year after the Effective Time, employees of
the Company who continue their employment will be provided employee benefits
which in the aggregate are at least generally comparable to those provided to
such employees as of the date of the Merger Agreement. The Merger Agreement also
provides that it is the Parent's stated current intention, following the first
anniversary of the Effective Time, to provide employee benefit plans, programs,
arrangements and policies for the benefit of employees of the Company which are
generally comparable in the aggregate to the employee benefit plans, programs,
arrangements and policies provided for the benefit of other similarly situated
employees of the Parent and its subsidiaries.

Amendment of Merger Agreement. The Merger Agreement provides that,
following the election or appointment of the Purchaser's designees to the
Company's Board (See "-- Board Representation" above) and prior to the Effective
Time, any amendment or termination of the Merger Agreement, extension of time
permitted for the performance of the obligations of the Parent or the Purchaser
thereunder or waiver or exercise of the Company's rights or remedies thereunder
will require the affirmative vote of a majority of the directors of the Company
then in office who were not designated by the Parent or the Purchaser.

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Agreements with Respect to Director and Officer Indemnification and
Insurance. Pursuant to the Merger Agreement, all provisions for the
indemnification and exculpation (including the advancement of expenses) from
liabilities for acts or omissions occurring at or prior to the Effective Time
(including with respect to the transactions contemplated by the Merger
Agreement) existing at the time of such Agreement or at the Effective Time in
favor of the Company's current or former directors or officers, as provided in
the Company's Certificate of Incorporation, its By-laws (each as in effect on
the date of the Merger Agreement) and reasonable indemnification agreements,
shall be assumed by the Surviving Corporation in the Merger, without further
action, as of the Effective Time and shall survive the Merger and continue in
full force and effect without amendment, modification or repeal in accordance
with their terms for a period of not less than six years after the Effective
Time.

In addition, the Merger Agreement provides that, for six years after the
Effective Time, the Parent shall, unless the Parent shall agree in writing to
guarantee the indemnification obligations discussed above, provide officers' and
directors' liability insurance in respect of acts or omissions occurring at or
prior to the Effective Time, including, but not limited to, the transactions
contemplated by the Merger Agreement, covering each person covered by the
Company's existing officers' and directors' liability insurance policy, or who
becomes covered by such policy prior to the Effective Time, on terms with
respect to coverage and amount no less favorable than those of such policy in
effect on the date of the Merger Agreement; provided, that in satisfying such
obligation, the Parent shall not be obligated to pay premiums in excess of 200%
of the amount per annum that the Company paid in its last full fiscal year; and
provided, further, that the Parent shall nevertheless be obligated to provide
such coverage as may be obtained for such 200% amount.

The Merger Agreement provides that in the event that the Parent, the
Surviving Corporation or any of their successors or assigns (i) consolidates
with or merges into any other person and is not the continuing or surviving
corporation or entity of such consolidation or merger or (ii) transfers or
conveys all or substantially all of its properties and assets to any to person,
then, and in each such case, proper provision will be made so that the
successors and assigns of the Parent or the Surviving Corporation, as the case
may be, shall assume the obligations set forth in the two preceding paragraphs.
In the event that the Surviving Corporation transfers any material portion of
its assets, in a single transaction or in a series of transactions, the Parent
will either guarantee the indemnification obligations referred to above or take
such other action to ensure that the ability of the Surviving Corporation, legal
and financial, to satisfy such indemnification obligations will not be
diminished in any material respect.

No Solicitation; Termination Fee. The Merger Agreement provides that the
Company shall not, and shall not authorize or permit any of its officers,
directors, employees, or any investment banker, financial advisor, attorney,
accountant or other representative retained by it to, directly or indirectly (i)
solicit, initiate or encourage (including by way of furnishing information), or
take any other action to facilitate, any inquiries or the making of any proposal
that constitutes, or may reasonably be expected to lead to, any Takeover
Proposal (as defined below) or (ii) participate in any discussions or
negotiations regarding any Takeover Proposal; provided, however, that if, at any
time prior to the acceptance for payment of Shares pursuant to and subject to
the conditions of the Offer, the Board of the Company (or the special committee
it formed in connection with the Offer and the Merger (the "Special Committee"))
determines in good faith, after consultation with outside counsel, that failure
to do so would create a substantial risk of liability for breach of its
fiduciary duties to the Company's stockholders under applicable law, the Company
may, in response to a Takeover Proposal that was unsolicited, and subject to
compliance with the provisions discussed below (x) furnish information with
respect to the Company to any person pursuant to a customary and reasonable
confidentiality agreement and (y) participate in negotiations regarding such
Takeover Proposal.

The Merger Agreement defines "Takeover Proposal" as any proposal or offer
from any person relating to any direct or indirect acquisition or purchase of
20% or more of the assets of the Company or 20% or more of any class of
outstanding equity securities of the Company, any tender offer or exchange offer
that if consummated would result in any person beneficially owning 20% or more
of any class of equity securities of the Company or any merger, consolidation,
business combination, sale of substantially all the assets, recapitalization,
liquidation, dissolution or similar transaction involving the Company, other
than the transactions contemplated by the Merger Agreement.

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The Merger Agreement provides further that unless the Board of the Company
shall have terminated the Merger Agreement as described below, neither the
Board, nor any committee thereof, shall (i) withdraw or modify, or propose to
withdraw or modify, in a manner adverse to the Parent, the approval or
recommendation by such Board or any such committee of the Offer, the Merger
Agreement or the Merger, (ii) approve or recommend, or propose to approve or
recommend, any Takeover Proposal or (iii) enter into any letter of intent,
agreement in principle, acquisition agreement or other agreement with respect to
any Takeover Proposal. The Company may terminate the Merger Agreement and take
any such action, if, prior to the obligation of the Purchaser to accept Shares
for payment pursuant to the Offer, the Board of the Company determines that a
Takeover Proposal constitutes a Superior Proposal (as defined below); provided,
however, that the Company may not terminate the Merger Agreement pursuant to
this provision unless and until five business days have elapsed following
delivery to the Parent of a written notice of such determination by the Board of
the Company and during such five business day period the Company (i) informs the
Parent of the terms and conditions of the Takeover Proposal and the identity of
the person making the Takeover Proposal and (ii) otherwise cooperates with the
Parent with respect thereto (subject, in the case of clause (ii), to the
condition that the Board of the Company shall not be required to take any action
that it believes, after consultation with outside legal counsel, would present a
substantial risk of liability for violating its obligations to the Company or
the Company's stockholders under applicable law) with the intent of enabling the
Parent to agree to a modification of the terms and conditions of the Merger
Agreement so that the transactions contemplated thereby may be effected;
provided, further, that the Company may not terminate the Merger Agreement
pursuant to such provision unless at the end of such five business day period
the Board of the Company continues to believe that the Takeover Proposal
constitutes a Superior Proposal and no later than two days thereafter the
Company pays to the Parent a termination fee in the amount of $6.25 million and
reimburses it for related expenses in an amount up to $500,000.

The Merger Agreement defines a "Superior Proposal" to be any bona fide
proposal made by a third party to acquire, directly or indirectly, for
consideration consisting of cash and/or securities, more than 50% of the voting
power of the Shares or all or substantially all the assets of the Company and
otherwise on terms that the Board of the Company determines in its good faith
judgment (based on the written opinion of a financial advisor of nationally
recognized reputation, which opinion shall be provided to the Parent) to be more
favorable to the Company's stockholders than the Offer and the Merger and for
which financing, to the extent required, is then committed or which, in the good
faith judgment of the Board of the Company, is capable of being obtained by such
third party.

The Merger Agreement provides that nothing contained therein shall prohibit
the Company from taking and disclosing to its stockholders with respect to a
Takeover Proposal a position contemplated by Rule 14e-2(a) promulgated under the
Exchange Act or from making any disclosure to the Company's stockholders if, in
the opinion of the Board of the Company (or the Special Committee), after
consultation with counsel, failure to so disclose would create a substantial
risk of liability for breach of its fiduciary duties to the Company's
stockholders under applicable law; provided, that the Company may not, except as
discussed above, withdraw or modify, or propose to withdraw or modify, its
position with respect to the Offer or the Merger or approve or recommend, or
propose to approve or recommend, a Takeover Proposal; provided, further, that
the taking of a position by the Company pursuant to Rule 14e-2(a)(2) or (3) of
the Exchange Act in respect of a Takeover Proposal shall not be deemed a
withdrawal, a modification, or a proposal to do either of its position with
respect to the Offer or the Merger.

(b)(2) THE STOCKHOLDER AGREEMENT.

Simultaneously with entering into the Merger Agreement, the Parent and the
Purchaser entered into a Stockholder Agreement (the "Stockholder Agreement")
with Chase Venture Capital Associates, L.P., CIBC Wood Gundy Ventures, Inc. and
Ronald D. Blum, O.D., Chairman, Chief Executive Officer and Secretary of the
Company (collectively the "Selling Stockholders"). The following summary of the
Stockholder Agreement is qualified in its entirety by reference to the
Stockholder Agreement, a copy of which is attached hereto as Exhibit B and
incorporated herein by reference. Such Agreement should be read in its entirety
for a more complete understanding of its terms and provisions.

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Sale or Tender of Shares. Pursuant to the Stockholder Agreement, each
Selling Stockholder has agreed to tender to the Purchaser, pursuant to the
Offer, or otherwise to sell to the Purchaser, in each case at a price of $13.75
per Share, all Shares beneficially owned by him or it (the "Subject Shares")
(representing an aggregate of 3,331,608 outstanding Shares, or approximately 37%
of the Shares outstanding as of February 10, 1997). Such obligation to tender or
sell is subject to the Purchaser having accepted Shares for payment under, and
subject to the conditions of, the Offer.

Restrictions on Transfer. Each of the Selling Stockholders has agreed,
until the Stockholder Agreement has terminated, among other things, not to: (i)
sell, transfer, give, pledge or otherwise dispose of, or enter into any
contract, option or other arrangement with respect to the sale, transfer,
pledge, assignment, or other disposition of, the Subject Shares owned by such
Selling Stockholder other than pursuant to the terms of the Offer or the Merger;
(ii) enter into any voting arrangement, whether by proxy, voting agreement or
otherwise, in connection with, directly or indirectly, any Takeover Proposal;
(iii) directly or indirectly solicit, initiate or encourage the submission of,
any Takeover Proposal; or (iv) directly or indirectly participate in any
discussions or negotiations regarding, or furnish to any person any information
with respect to, or take any other action to facilitate any inquiries or the
making of any proposal that constitutes, or may reasonably be expected to lead
to, any Takeover Proposal; provided, that clause (iv) will not be deemed to have
been violated if in response to an unsolicited inquiry, the Selling Stockholder
states that he or it is subject to the provisions of the Stockholder Agreement.

Voting Rights. Each of the Selling Stockholders has also agreed, and the
Stockholder Agreement includes an irrevocable proxy provision for the benefit of
the Purchaser with respect to the Subject Shares owned by each Selling
Stockholder, to, until the Stockholder Agreement has terminated, vote such
Shares (i) at any meeting of stockholders of the Company called to vote upon the
Merger and the Merger Agreement or at any adjournment thereof or in any other
circumstances upon which a vote, consent or other approval (including by written
consent) with respect to the Merger and the Merger Agreement is sought, in favor
of the Merger, the adoption by the Company of the Merger Agreement and the
approval of the terms thereof and each of the other transactions contemplated by
the Merger Agreement; and (ii) at any meeting of stockholders of the Company or
at any adjournment thereof or in any other circumstances upon which a Selling
Stockholder's vote, consent or other approval is sought, against (x) any
Takeover Proposal or (y) any amendment of the Company's Certificate of
Incorporation or By-laws or other proposal or transaction involving the Company,
which amendment or other proposal or transaction would be reasonably likely to
impede, frustrate, prevent or nullify the Merger, the Merger Agreement or any of
the other transactions contemplated by the Merger Agreement or change in any
manner the voting rights of each class of the Company's Common Stock.

Termination. The Stockholder Agreement provides that it will terminate on
the date upon which the Merger Agreement is terminated in accordance with its
terms, provided that a termination fee has not, or could not at any time in the
future, become payable under the Merger Agreement, in which case certain
provisions of the Stockholder Agreement, including those discussed below, shall
survive until such termination fee is paid.

Payment by Stockholders. The Stockholder Agreement provides that in the
event that the Merger Agreement shall have been terminated under circumstances
where the Parent is or may become entitled to receive a termination fee, each
Stockholder shall pay to the Parent on demand an amount equal to the difference
between the consideration received by such Stockholder from the consummation of
any transaction which gives rise to the Company's obligation to pay the
termination fee pursuant to the Merger Agreement and the consideration such
Stockholder would have received had he or it tendered the Subject Shares
pursuant to the Offer (without taking into account any modifications to the
Offer as in effect on the date hereof), as determined in accordance with the
Stockholder Agreement.

In addition, the Stockholder Agreement provides that in the event that (x)
prior to the Effective Time, a Takeover Proposal shall have been made and (y)
the Effective Time shall have occurred and the Parent for any reason shall have
increased the amount of merger consideration payable over that set forth in the
Merger Agreement in effect on the date thereof (the "Original Merger
Consideration"), each Selling Stockholder

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shall pay to the Parent on demand an amount in cash equal to the product of (i)
the number of Subject Shares owned by such Selling Stockholder and (ii) 100% of
the excess, if any, of (A) the per Share cash consideration or the per Share
fair market value of any noncash consideration, as the case may be, received by
such Selling Stockholder as a result of the Merger, as amended, determined as of
the Effective Time, over (B) the amount of the Original Merger Consideration
determined as of the time of the first increase in the amount of the Original
Merger Consideration.

(b)(3) ARRANGEMENTS WITH EXECUTIVE OFFICERS, DIRECTORS OR AFFILIATES OF THE
COMPANY AND CONFLICTS.

Certain contracts, agreements, arrangements and understandings between the
Company and certain of its executive officers and directors are summarized in
the Information Statement attached hereto as Schedule I and incorporated herein
by reference under the Sections entitled "Executive Compensation" and "Certain
Relationships and Related Transactions."

A summary of certain other contracts, agreements, arrangements and
understandings between the Company and its executive officers, directors and
affiliates and certain actual or potential conflicts are set forth below.

(i) Stock Options. The current directors and executive officers of the
Company as a group hold Company Stock Options granted under the Stock
Option Plans to purchase an aggregate of 1,184,432.3 Shares at exercise
prices ranging from $0.079 to $15.50 per Share. In accordance with the
terms of the Merger Agreement, each holder of a Company Stock Option
granted under the Stock Option Plans which is outstanding immediately prior
to the consummation of the Offer, whether or not then exercisable, will be
entitled, upon cancellation, to receive from the Company an amount in cash
equal to the product of (x) the number of Shares subject to such Company
Stock Option immediately prior to the Effective Time and (y) the excess of
the price per Share to be paid in the Offer over the per Share exercise
price of such Company Stock Option. See ITEM 3(b)(1) "THE MERGER
AGREEMENT -- Stock Option Plans and Warrants."

(ii) Employment Agreements. The Company is a party to employment
agreements with certain of its executive officers, consisting of Dr. Ronald
D. Blum, Dr. Amitava Gupta, Steven A. Bennington, Robert P. Padula, Sunder
H. Malkani, Horace N. Hudson and Jo Ann Swasey. By operation of law, the
employment agreements will become obligations of the Surviving Corporation
after the Merger. Certain of these agreements provide for the payment of
certain severance and other benefits upon termination of the officer's
employment following a change in control of the Company.

(iii) Noncompetition Agreements. The Parent is a party to
noncompetition agreements entered into in connection with the Merger with
certain of the Company's key executive officers, consisting of Dr. Ronald
D. Blum, Dr. Amitava Gupta, Steven A. Bennington, Robert P. Padula, Sunder
H. Malkani, Horace N. Hudson and Jo Ann Swasey. Under these agreements,
each such executive officer has agreed to not, for two years following the
termination of such executive officer's employment, engage in certain
specified activities relating to the Company or the Company's business.
Pursuant to such non-competition agreements, if any such officer's
employment with the Company is terminated without Cause (as defined in such
agreements), the Company will continue to pay such officer through the end
of such two-year period, in accordance with the Company's regular payroll
practices, an amount equal to such officer's annual salary.

(iv) Exculpation and Indemnification of Officers and Directors. The
Company's Certificate of Incorporation provides that no director shall be
personally liable to the Company or its stockholders for monetary damages
for breach of fiduciary duty as a director, notwithstanding any provision
of law imposing such liability, provided that liability is not eliminated
(A) for any breach of a director's duty of loyalty to the Company or its
stockholders; (B) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law; (C) for actions
covered under Section 174 of the Delaware General Corporation Law (the
"DGCL"); or (D) for any transaction from which the director derived an
improper personal benefit.

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In addition, the Company's By-Laws provide that the Company shall
indemnify directors, officers, employees or agents against liabilities
incurred in their capacities as such if such director, officer, employee or
agent acted in good faith and in a manner he reasonably believed to be in
or not opposed to the best interests of the Company, and, with respect to
any criminal action or proceeding, had no reasonable cause to believe his
conduct was unlawful. To the extent that a director, officer, employee or
agent of the Company has been successful on the merits or otherwise in
defense of any action, suit or proceeding, he shall be indemnified against
expenses (including attorneys' fees) actually and reasonably incurred by
him in connection therewith. Expenses incurred by an officer or director in
defending a civil or criminal action, suit or proceeding may be paid by the
Company in advance of the final disposition thereof as authorized by the
Company's Board upon receipt of an undertaking by such officer or director
to repay such amount unless it is ultimately determined that such officer
or director is entitled to indemnification. The indemnification provided by
the Company's By-Laws is not exclusive. The Company may maintain insurance,
at its expense, to protect itself and its directors, officers, employees or
agents against any expense, liability or loss, whether or not the Company
would have the power to indemnify such person against such expense,
liability or loss under the DGCL. The Company currently maintains such
insurance for its directors and executive officers.

The Merger Agreement provides that the indemnification obligations set
forth in the Company's Certificate of Incorporation and By-laws on the date
of the Merger Agreement shall survive the Merger and shall not be amended,
repealed or otherwise modified for a period of six years after the
Effective Time. It is expected that the officers and directors of the
Company will enter into reasonable indemnification agreements with the
Company prior to the Effective Time. Pursuant to the terms of the Merger
Agreement, such agreements shall become obligations of the Surviving
Corporation and shall survive the Merger for a period of six years after
the Effective Time.

Pursuant to the terms of the Merger Agreement and subject to certain
limitations, for a period of six years from the Effective Time, the Parent
shall, unless the Parent agrees in writing to guarantee the indemnification
obligations set forth in the preceding paragraph, provide officers' and
directors' liability insurance covering those persons who are covered by
the Company's existing officers' and directors' liability insurance policy
or who become covered by such policy prior to the Effective Time. See ITEM
3(b)(1) "THE MERGER AGREEMENT -- Agreements with Respect to Director and
Officer Indemnification and Insurance."

(v) Certain Payments. Three significant stockholders of the Company have
indicated an agreement to pay to Dr. Ronald D. Blum, Chairman, Chief Executive
Officer and Secretary of the Company, an aggregate amount of approximately
$200,000 to compensate Dr. Blum for certain tax liabilities to be incurred by
him as a result of the Merger Agreement and the transactions contemplated
thereby. The form and timing of such payment is subject to final agreement by
such parties.

ITEM 4. THE SOLICITATION OR RECOMMENDATION.

(a) RECOMMENDATION OF THE BOARD OF DIRECTORS. The Company's Board has
unanimously approved the Merger Agreement, the Offer and the transactions
contemplated thereby and unanimously recommends that all holders of Shares
tender such Shares pursuant to the Offer.

(b) BACKGROUND; REASONS FOR BOARD'S RECOMMENDATION.

Since February 1993, the Parent and the Company have from time to time
engaged in discussions and exchanges of information in an effort to examine
possible business arrangements.

In August 1995, as part of a series of transactions aimed at providing the
Company with necessary financing, Johnson & Johnson Development Corporation
purchased $1,500,000 of preferred stock in the Company. In addition,
concurrently therewith, the Parent acquired an option (the "Option") to purchase
all of the outstanding capital stock of the Company at a net aggregate exercise
price of approximately $85 million. The Parent paid the Company $1,500,000 in
consideration for the grant of the Option. Due to certain business

7
<PAGE> 9

considerations, the Parent did not exercise the Option, and pursuant to its
terms, the Option terminated on March 14, 1996 and the Parent was issued
additional preferred stock in lieu thereof.

The Parent conducted due diligence investigations of the Company during the
fall and winter of 1995-1996 in connection with the Option, and the Parent,
Johnson & Johnson Vision Products, Inc. and the Company entered into a
Confidentiality Agreement (the "Confidentiality Agreement") in connection
therewith on November 27, 1995.

As a result of transactions immediately preceding the Company's initial
public offering on March 14, 1996, the equity securities owned by the Parent and
its subsidiaries were converted into an aggregate of 474,515 Shares.

On August 1, 1996 and January 31, 1997, respectively, the Confidentiality
Agreement was restated and amended, and the Parent thereafter conducted new due
diligence reviews of the Company in contemplation of a possible business
arrangement. During January 1997, the Parent decided to propose a transaction to
the Company whereby the Parent would acquire all the outstanding capital stock
of the Company for cash.

On January 29, 1997, James R. Utaski, Vice President, Corporate Development
of the Parent, W. Ben Deibler, Vice President, New Business Development,
Worldwide Franchise Vistaken, a division of a subsidiary of the Parent, and
James R. Hilton, Assistant General Counsel of the Parent, met in New York with
Ronald D. Blum, O.D., Chairman, Chief Executive Officer and Secretary of the
Company, Damion E. Wicker, M.D., a director of the Company and a general partner
of the general partner of Chase Venture Capital Associates, L.P., Ian M. Kidson,
a director of the Company and a Managing Director of CIBC Wood Gundy Securities
Inc., and counsel to the Company. At the meeting, Messrs. Utaski, Deibler and
Hilton expressed the Parent's serious interest in exploring an acquisition of
the Company and proposed general parameters pursuant to which the Parent would
be willing to proceed with such a transaction. The representatives of the
Company expressed the Company's interest in proceeding with discussions.

On January 30, 1997, the same parties continued negotiations by telephone
conference.

On February 2, 1997, the same parties other than Mr. Hilton met again in
New York. Mr. Deibler indicated that the Parent was prepared to proceed with an
acquisition of the Company valued between approximately $130 and $134 million,
subject to the accuracy of certain assumptions (including the amount of cash and
equivalents and usable net operating loss carryforwards) and subject to
completion of due diligence and the negotiation of definitive agreements. On
this basis, Dr. Blum agreed on behalf of the Company to move forward to consider
whether to effect a transaction with the Parent.

Following the February 2, 1997 meeting, the Parent began a new extensive
due diligence review of the Company. Also, on February 2, 1997, the Company's
Board resolved to create the Special Committee to explore various strategic
alternatives for the Company, including a possible transaction with the Parent.

On February 5, 1997, Messrs. Utaski and Deibler met in New York with
counsel for the Parent and the Company, Michael B. Packard and Gregory J.
Forrest, each a director of the Company and a member of the Special Committee,
counsel to the Special Committee and representatives of Prudential Securities
Incorporated ("Prudential Securities"). The Parent's representatives confirmed
that it was a condition to the Parent's willingness to enter into an agreement
to acquire the Company that there be an agreement along the lines of the
Stockholder Agreement and that there be certain other provisions in the event of
the termination of the Merger Agreement by the Company in connection with a
competing transaction. The members of the Special Committee and their
representatives discussed with the Parent and its representatives the details of
such provisions as well as certain other provisions of the draft documents that
had been circulated.

Between February 5, 1997 and February 10, 1997, the Parent, the Company,
the Special Committee and their respective representatives had several internal
discussions and continued negotiations with respect to the price, the amount and
terms of the termination fee and other details of the transaction. On February
9, 1997, the Special Committee met with its counsel, representatives of
Prudential Securities and Company counsel and reviewed and discussed the
proposed transaction, including drafts of the Merger Agreement and related
documents. After various proposals and counterproposals, these negotiations
culminated in the Special Committee recommending to the Company's Board during
its meeting on February 10, 1997 the Parent's

8
<PAGE> 10

proposed price of $13.75 per Share and forms of definitive agreements, and the
Company and the Parent agreeing on such price and documentation. The Company's
full Board met midday on Monday, February 10, 1997. Following a presentation of
Prudential Securities, the Company's receipt of the fairness opinion from
Prudential Securities and discussions with counsel to the Company and to the
Special Committee concerning the terms of the Offer and the Merger and the
fiduciary duties of the Company's directors, the Special Committee met
separately and determined to recommend to the full Board approval of the
proposed transaction. Thereafter, the full Board reconvened and, after receiving
the Special Committee's recommendation, approved the transaction. The Parent's
Board of Directors also met Monday, February 10, 1997 during which meeting the
transactions contemplated by the Merger Agreement and the Stockholder Agreement
were approved. Following these approvals, the Merger Agreement and the
Stockholder Agreement were executed, and the transaction was publicly announced
before financial markets opened on February 11, 1997.

A copy of the joint press release announcing the execution of the Merger
Agreement is attached hereto as Exhibit C and incorporated herein by reference.
A copy of a letter to stockholders of the Company from Dr. Ronald D. Blum, which
is enclosed with this Schedule 14D-9, is attached hereto as Exhibit D and
incorporated herein by reference.

In approving the Merger Agreement and the transactions contemplated
thereby, and recommending that all holders of Shares tender their Shares
pursuant to the Offer, the Company's Board considered a number of factors,
including:

1) the financial and other terms of the Offer and the Merger Agreement
and the absence of any competing, superior proposal to acquire the Company;

2) that the $13.75 per Share tender offer price represents a premium
of approximately 53% over the closing price of the Shares on the Nasdaq
National Market ("NNM") on February 7, 1997, the last full trading day
prior to the execution of the Merger Agreement;

3) recent trading prices of the Shares on the NNM, including the fact
that the Shares have never traded at or above the $13.75 Offer price;

4) that the Special Committee, following discussions with its special
counsel and Prudential Securities, unanimously recommended approval of the
Merger Agreement and the transactions contemplated thereby;

5) that the termination provisions of the Merger Agreement, and the
related provision allowing the Company to respond, subject to certain
conditions, to unsolicited proposals concerning an acquisition of the
Company, permit the Company, subject to certain conditions, to terminate
the Merger Agreement upon payment to the Parent of a break-up fee of $6.25
million, plus up to $500,000 in reimbursement of expenses, in the event
that the Board decides to withdraw its recommendation that stockholders
accept the Offer and approve the Merger Agreement after determining that
failure to do so would create a substantial risk of liability for breach of
its fiduciary duties under applicable law (see ITEM 3(b)(1) above);

6) information provided by Company management regarding the financial
condition, results of operations, business and prospects of the Company,
including the prospects if the Company were to remain independent;

7) the terms of the Stockholder Agreement, which provide that the
Selling Stockholders thereunder would receive the same consideration per
Share as would all other holders of Shares, thereby ensuring that the
public stockholders would participate in any control premium realized in
connection with the Offer and the Merger;

8) the written opinion of Prudential Securities dated February 10,
1997 that, as of such date and based upon and subject to the matters set
forth therein, the cash consideration to be received by the holders of the
Shares in the Offer and the Merger is fair from a financial point of view
to such holders. A copy of the opinion of Prudential Securities is attached
hereto as Schedule II and incorporated herein by reference. STOCKHOLDERS
ARE URGED TO READ THE OPINION OF PRUDENTIAL SECURITIES CAREFULLY IN ITS
ENTIRETY;

9
<PAGE> 11

9) the ability of the Purchaser to consummate the Offer and the Merger
without conditioning the Offer on obtaining any specific financing
commitments;

10) a review and discussion of the viability and associated costs of
certain Company product development activity; and

11) the familiarity of the Board with the business, results of
operations, properties and financial condition of the Company and the
nature of the industry in which it operates.

The foregoing discussion of the information and factors considered and
given weight by the Board is not intended to be exhaustive. In view of the
variety of factors considered in connection with its evaluation of the Merger
Agreement and the Offer, the Board did not find it practicable to, and did not,
quantify or otherwise assign relative weights to the specific factors considered
in reaching its determination. In addition, individual members of the Board may
have afforded different weights to different factors.

ITEM 5. PERSONS RETAINED, EMPLOYED OR TO BE COMPENSATED.

Prudential Securities has been retained by the Company to act as financial
advisor to the Company with respect to the Offer, the Merger and matters arising
in connection therewith. Pursuant to a letter agreement dated February 4, 1997
between the Company and Prudential Securities (the "Letter Agreement"), the
Company has agreed to pay Prudential Securities a fee (the "Transaction Fee")of
$600,000 upon the purchase of Shares pursuant to the Offer. Prudential
Securities was paid a fee of $50,000 upon execution of the Letter Agreement.
Such fee will be credited against the Transaction Fee, if any, to be paid to
Prudential Securities by the Company pursuant to the Letter Agreement. The
Company has agreed to pay Prudential Securities a total fee (including any
amounts paid prior thereto) in an amount equal to 0.75% of the total
consideration paid in any Transaction (as defined in the Letter Agreement) if
the Company requests in writing that Prudential Securities contact and/or
negotiate with bidders other than the Parent (regardless of whether a
Transaction is consummated with any such other bidders or the Parent). Any such
request by the Company would be subject to the terms of the Merger Agreement
discussed above in ITEM 3(b)(1) "MERGER AGREEMENT -- No Solicitation;
Termination Fee." The Company has also agreed to reimburse Prudential Securities
for its reasonable out-of-pocket expenses, including the fees and expenses of
its counsel, and to indemnify Prudential securities for certain liabilities
arising out of its engagement, including liabilities arising under the Federal
securities laws.

In the ordinary course of its business, Prudential Securities may trade the
Shares for its own account and for the accounts of customers and, accordingly,
may at any time hold a long or short position in the Shares.

Except as disclosed herein or in the Offer to Purchase, neither the Company
nor any person acting on its behalf currently intends to employ, retain or
compensate any other person to make solicitations or recommendations to security
holders on its behalf concerning the Offer or the Merger.

ITEM 6. RECENT TRANSACTIONS AND INTENT WITH RESPECT TO SECURITIES.

(A) SHARE TRANSACTIONS IN LAST 60 DAYS. During the past 60 days, no
transactions in Shares have been effected by the Company or, to the Company's
knowledge, by any executive officer, director or affiliate of the Company.

(B) INTENT TO TENDER. To the Company's knowledge, to the extent permitted
by applicable securities laws, rules or regulations, except for any gifts of
Shares to family members or charitable organizations, and except as provided by
the Stockholder Agreement, each of the Company's executive officers and
directors currently intends to tender all Shares over which he or she has sole
dispositive power to the Purchaser.

ITEM 7. CERTAIN NEGOTIATIONS AND TRANSACTIONS BY THE SUBJECT COMPANY.

(A) CERTAIN NEGOTIATIONS. Except as described in this Schedule 14D-9, no
negotiation is being undertaken or is underway by the Company in response to the
Offer which relates to or would result in

10
<PAGE> 12

(i) an extraordinary transaction, such as a merger or reorganization, involving
the Company or any subsidiary of the Company, (ii) a purchase, sale or transfer
of a material amount of assets by the Company or any subsidiary of the Company,
(iii) a tender offer for or other acquisition of securities by or of the Company
or (iv) any material change in the present capitalization or dividend policy of
the Company. Pursuant to the Merger Agreement, however, and as described above
under ITEM 3 "MERGER AGREEMENT -- No Solitation; Termination Fee," the Company
may, subject to certain prescribed limitations, take certain actions in respect
of proposed transactions which the failure to take would create a substantial
risk of liability for breach of its directors' fiduciary duties to stockholders
under applicable law.

(B) CERTAIN TRANSACTIONS. Except as described in ITEMS 3(b) or 4(b) above,
there are no transactions, Company Board resolutions, agreements in principle or
signed contracts in response to the Offer which relate to or would result in one
or more of the matters referred to in ITEM 7(a) above.

ITEM 8. ADDITIONAL INFORMATION TO BE FURNISHED.

The Information Statement attached as Schedule I hereto is being furnished
in connection with the possible designation by the Purchaser, pursuant to the
Merger Agreement, of certain persons to be appointed to the Board of the Company
other than at a meeting of the Company's stockholders.

11
<PAGE> 13

ITEM 9. MATERIAL TO BE FILED AS EXHIBITS.

<TABLE>
<CAPTION>
EXHIBIT DESCRIPTION
----------- -----------------------------------------------------------------------------
<S> <C>
Exhibit A Agreement and Plan of Merger, dated as of February 10, 1997, by and among
Johnson & Johnson, INO Acquisition Corp. and Innotech, Inc. (incorporated by
reference to Exhibit (c)(1) of the Schedule 14D-1 of INO Acquisition Corp.
and Johnson & Johnson filed with the Securities and Exchange Commission on
February 18, 1997 (the "Schedule 14D-1")).
Exhibit B Stockholder Agreement, dated as of February 10, 1997, by and among Johnson &
Johnson, INO Acquisition Corp., Innotech, Inc. and Chase Venture Capital
Associates, L.P., CIBC Wood Gundy Ventures, Inc. and Ronald D. Blum, O.D.
(incorporated by reference to Exhibit (c)(2) of the Schedule 14D-1).
Exhibit C Joint Press Release of Johnson & Johnson and Innotech, Inc., dated February
11, 1997 (incorporated by reference to Exhibit (a)(8) of the Schedule 14D-1).
Exhibit D Letter to Stockholders of Innotech, Inc., dated February 18, 1997.*
Exhibit E [Intentionally Omitted].
Exhibit F Amended and Restated Employment Agreement, between Innotech, Inc. and Robert
P. Padula, dated September 19, 1996.
Exhibit G Amendment to Employment Agreement, between Innotech, Inc. and Horace N.
Hudson, dated October 16, 1996.
Exhibit H Amendment to Amended and Restated Employment Agreement, between Innotech,
Inc. and Dr. Amitava Gupta, dated October 16, 1996.
Exhibit I Amendment to Employment Agreement, between Innotech, Inc. and Dr. Ronald D.
Blum, dated October 16, 1996.
Exhibit J Third Amended and Restated Employment Agreement, between Innotech, Inc. and
Steven A. Bennington, dated October 16, 1996.
Exhibit K Employment Agreement, between Innotech, Inc. and Sunder H. Malkani, dated
October 2, 1995.
Exhibit L Employment Agreement, between Innotech, Inc. and Jo Ann Swasey, dated April
1, 1996.
Exhibit M Noncompetition Agreement, between Johnson & Johnson and Dr. Ronald D. Blum,
dated February 10, 1997.
Exhibit N Noncompetition Agreement, between Johnson & Johnson and Dr. Amitava Gupta,
dated February 10, 1997.
Exhibit O Noncompetition Agreement, between Johnson & Johnson and Steven A. Bennington,
dated February 10, 1997.
Exhibit P Noncompetition Agreement, between Johnson & Johnson and Robert P. Padula,
dated February 10, 1997.
Exhibit Q Noncompetition Agreement, between Johnson & Johnson and Horace N. Hudson,
dated February 10, 1997.
Exhibit R Noncompetition Agreement, between Johnson & Johnson and Jo Ann Swasey, dated
February 10, 1997.
Exhibit S Noncompetition Agreement, between Johnson & Johnson and Sunder H. Malkani,
dated February 10, 1997.
Exhibit T Offer to Purchase, dated February 18, 1997 (incorporated by reference to
Exhibit (a)(1) of the Schedule 14D-1).**
Exhibit U Letter of Transmittal (incorporated by reference to Exhibit (a)(2) of the
Schedule 14D-1).**
</TABLE>

- ---------------
* Included in the Schedule 14D-9 materials being mailed to Company
stockholders.

** Included in the Offer to Purchase materials being mailed to Company
stockholders.

12
<PAGE> 14

SIGNATURE

After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.

Dated: February 18, 1997

INNOTECH, INC.

By: /s/ STEVEN A. BENNINGTON
------------------------------------
Steven A. Bennington
President and Chief Operating
Officer

13
<PAGE> 15

SCHEDULE I

INNOTECH, INC.
5568 AIRPORT ROAD
ROANOKE, VIRGINIA 24012
------------------------

INFORMATION STATEMENT PURSUANT TO
SECTION 14(f) OF
THE SECURITIES EXCHANGE ACT OF 1934
AND RULE 14f-1 THEREUNDER

This Information Statement is being mailed on or about February 18, 1997 as
part of the Solicitation/ Recommendation Statement on Schedule 14D-9 (the
"Schedule 14D-9") of Innotech, Inc., a Delaware corporation (the "Company"), to
holders of record of shares of Common Stock, par value $.001 per share, of the
Company (the "Shares") at the close of business on or about February 13, 1997.
You are receiving this Information Statement in connection with the possible
election or appointment of persons designated by INO Acquisition Corp., a
Delaware corporation (the "Purchaser"), to a majority of the seats on the Board
of Directors of the Company.

On February 10, 1997, the Company, the Purchaser and Johnson & Johnson, a
New Jersey corporation (the "Parent"), entered into an Agreement and Plan of
Merger (the "Merger Agreement") in accordance with the terms and subject to the
conditions of which (i) the Parent will cause the Purchaser to commence a tender
offer (the "Offer") for all outstanding Shares at a price of $13.75 per Share,
net to the seller in cash, and (ii) the Purchaser will be merged with and into
the Company (the "Merger"). As a result of the Offer and the Merger, the Company
will become a wholly owned subsidiary of the Parent. In addition, on February
10, 1997, the Purchaser, the Parent and Chase Venture Capital Associates, L.P.,
CIBC Wood Gundy Ventures, Inc. and Ronald D. Blum, O.D., Chairman and Chief
Executive Officer of the Company, entered into a Stockholder Agreement pursuant
to which each agreed to sell or tender to the Purchaser all of the Shares held
by them at a price of $13.75 per Share.

The Merger Agreement requires the Company to use all reasonable efforts to
cause the Purchaser's designees to be elected or appointed to the Board of
Directors of the Company under the circumstances described therein. This
Information Statement is required by Section 14(f) of the Securities Exchange
Act of 1934, as amended, and Rule 14f-1 promulgated thereunder. See "RIGHT TO
DESIGNATE DIRECTORS; THE PURCHASER DESIGNEES."

You are urged to read this Information Statement carefully. You are not,
however, required to take any action in connection with the matters herein
discussed. Capitalized terms used herein and not otherwise defined herein have
the meanings set forth in the Schedule 14D-9.

Pursuant to the Merger Agreement, the Purchaser commenced the Offer on
February 18, 1997. The Offer is scheduled to expire at 12:00 midnight, New York
City time, on March 17, 1997, unless the Offer is extended.

The information contained in this Information Statement concerning the
Parent, the Purchaser and the Purchaser's designees for the Company's Board of
Directors (the "Purchaser Designees") has been furnished to the Company by the
Parent and the Purchaser, and the Company assumes no responsibility for the
accuracy or completeness of such information.

I-1
<PAGE> 16

RIGHT TO DESIGNATE DIRECTORS; THE PURCHASER DESIGNEES

Pursuant to the Merger Agreement, promptly following the purchase by and
payment for Shares by the Purchaser pursuant to the terms, and subject to the
conditions of the Offer, the Purchaser will be entitled to designate such number
of directors as will give the Purchaser representation on the Board of Directors
of the Company equal to a majority of the Board of Directors. The Merger
Agreement requires that the Company will, upon request by and at the option of
the Parent, either increase the size of the Board of Directors and/or secure the
resignations of current directors to enable the Purchaser Designees to be
elected or appointed to the Board of Directors and to constitute a majority of
the Company's Board of Directors. The Board of Directors of the Company
currently consists of six members. The Board of Directors of the Company plans
to increase the size of the Board by resolution to satisfy this requirement, if
necessary. The Purchaser Designees may assume office at any time following the
purchase by the Purchaser of Shares pursuant to the terms, and subject to the
conditions, of the Offer, which purchase cannot be earlier than March 18, 1997.

None of the Purchaser Designees (a) is currently a director of, or holds
any position with, the Company, (b) has a familial relationship with any of the
directors or executive officers of the Company or (c) to the best knowledge of
the Purchaser, beneficially owns any securities (or rights to acquire any
securities) of the Company. The Company has been advised by the Purchaser that,
to the best of the Purchaser's knowledge, none of the Purchaser Designees has
been involved in any transactions with the Company or any of its directors,
executive officers or affiliates which are required to be disclosed pursuant to
the rules and regulations of the Securities and Exchange Commission, except as
may be disclosed herein or in the Schedule 14D-9.

The Purchaser has informed the Company that it will choose the Purchaser
Designees from the Purchaser's directors and executive officers listed below.
The Purchaser has informed the Company that each of the Purchaser Designees has
consented to act as a director, if so designated. The names of the Purchaser
Designees, their ages as of February 14, 1997, and certain other information
about them are set forth below. All of the Purchaser Designees are executive
officers and directors of the Purchaser and the business address of each such
executive officer and director is One Johnson & Johnson Plaza, New Brunswick,
New Jersey 08933. Unless otherwise indicated below, each occupation set forth
opposite an individual's name refers to employment with the Parent.

<TABLE>
<CAPTION>
NAME OF THE PURCHASER DESIGNEE AGE PRINCIPAL OCCUPATION DURING THE PAST FIVE YEARS
- ----------------------------------- ---- -----------------------------------------------------
<S> <C> <C>
Peter S. Galloway.................. 55 Peter S. Galloway has served as director and Vice
President of the Purchaser since February 1997,
Associate General Counsel of the Parent since 1988,
and Secretary of the Parent since 1994.
James R. Hilton.................... 50 James R. Hilton has served as director, Vice
President, Secretary and Treasurer of the Purchaser
since February 1997, and Assistant General Counsel of
the Parent since 1990.
James R. Utaski.................... 57 James R. Utaski has served as director and President
of the Purchaser since February 1997, Corporate Vice
President, Business Development of the Parent since
1990, and Company Group Chairman from 1986 to 1990.
</TABLE>

I-2
<PAGE> 17

INFORMATION REGARDING THE COMPANY

The Shares are the only class of voting securities of the Company
outstanding. Each Share is entitled to one vote. As of February 14, 1997, there
were 8,956,096 Shares outstanding and 1,697,895 Shares reserved for issuance
upon the exercise of stock options and warrants then outstanding. The Board of
Directors of the Company currently consists of six members. The Board of
Directors is divided into three classes and each director serves for a term of
three years and until his successor is duly elected and qualified or until his
earlier death, resignation or removal.

DIRECTORS AND EXECUTIVE OFFICERS OF THE COMPANY

The names of the current directors, their ages as of February 14, 1997, and
certain other information about them (based upon information provided by such
persons) are set forth below. As indicated above, some (or all) of the current
directors may resign effective immediately following the purchase of Shares by
the Purchaser pursuant to the terms, and subject to the conditions, of the
Offer.

Gregory J. Forrest(1)(2)............. 49 1996 Gregory J. Forrest has served, since June
Director 1993, as a principal of Forrest Binkley &
Brown L.P., which he co-founded and which is
the managing general partner of SBIC
Partners, L.P., a Texas limited partnership
and private equity investment fund. From
April 1992 until June 1993, he served as the
Chairman and President of BankAmerica
Venture Capital. Prior to April 1992, Mr.
Forrest was the President and Chief
Executive Officer of Security Pacific
Venture Capital.

Ian M. Kidson(3)(4).................. 38 1995 Ian M. Kidson is a Managing Director of CIBC
Director Wood Gundy Securities, Inc., a merchant bank
affiliated with CIBC Wood Gundy Ventures,
Inc. ("CIBC"). He has served CIBC Wood Gundy
Securities, Inc. in various capacities since
he joined the firm in 1984.

CLASS II DIRECTOR (term to expire in
1997)
Amitava Gupta, Ph.D.(1)(3)........... 50 1993 Amitava Gupta has served the Company as a
Executive Vice President of research and development consultant and
Engineering, Research and technical advisor to the Company's Board of
Development, and Director Directors from September 1991 until January
1992 when he became Director of Engineering,
Research and Development. He has served
since January 1993 as the Company's
Executive Vice President of Engineering,
Research and Development. Since November
1996, Dr. Gupta has served as Chief
Operating Officer of Prism Ophthalmics,
L.L.C., a developer of intraocular implants.
Dr. Gupta is an inventor named on numerous
patents.
</TABLE>

I-3
<PAGE> 18

<TABLE>
<CAPTION>
YEAR FIRST
NAME OF DIRECTOR AND POSITION WITH ELECTED AS A PRINCIPAL OCCUPATION DURING THE PAST FIVE
THE COMPANY AGE DIRECTOR YEARS
- ------------------------------------- --- ------------- --------------------------------------------
<S> <C> <C> <C>
CLASS III DIRECTORS (terms to expire
in 1998)
Ronald D. Blum, O.D.(1).............. 50 1990 Ronald D. Blum was the founder of the
Chairman of the Board, Chief Company and has served as Chairman of the
Executive Officer, Secretary, and Board and Secretary since the Company's
Director inception in October 1990. Dr. Blum also
served as President from the Company's
inception until November 1994 and has served
as Chief Executive Officer since 1994. Until
December 1992, Dr. Blum also served as Chief
Executive Officer of Drs. Blum, Newman,
Blackstock and Associates, Optometrists,
P.C., an optometric practice which he
co-founded in 1977. Dr. Blum is an inventor
named on numerous patents dealing with
optical care technologies and has been
engaged in the development of new products
and technologies since 1982. He has written
numerous articles and has lectured at many
professional meetings. Dr. Blum has been a
member of the editorial advisory board of
Eye Care Business, an optometric industry
magazine, and he is currently a member of
the American Optometric Association. Dr.
Blum was a contributing editor to 20/20
Magazine, an optometric industry magazine.
Michael B. Packard(2)(3)............. 48 1992 Michael B. Packard has served since February
Director 1990 as Executive Vice President of
LensCrafters, Inc., simultaneously serving
during 1993 as President of Sight & Save, a
division of LensCrafters, Inc. Mr. Packard
had earlier served in a variety of other
positions at LensCrafters, Inc., including
Vice President of Products, Vice President
of Manufacturing and as Senior Vice
President.
Damion E. Wicker, M.D.(1)(3)(4)...... 36 1993 Damion E. Wicker has been a Partner of Chase
Director Capital Partners since January 1997, and was
a Principal from April 1993 until January
1997. Chase Capital Partners is the general
partner of Chase Venture Capital Associates,
L.P., formerly Chemical Venture Capital
Associates, L.P. ("CVCA"). From July 1991
until April 1993, Dr. Wicker served as
President and a director of Adams
Scientific, Inc., a biotechnology diagnostic
company which he founded. From May 1988 to
July 1991, he was an associate with MBW
Venture Partners, a venture capital firm.
Dr. Wicker was also a Commonwealth Fund
Medical Fellow for the National Institute of
Health. Dr. Wicker is a director of
InteCare/LLC and Hepatix, Inc.
</TABLE>

- ---------------
(1) Member of Nominating Committee.
(2) Member of Special Committee.
(3) Member of Audit Committee.
(4) Member of Compensation Committee.

I-4
<PAGE> 19

INFORMATION CONCERNING THE BOARD OF DIRECTORS

The Board of Directors met five times during fiscal year 1996, which ended
on December 31, 1996. The Board's Nominating Committee held no meetings during
fiscal year 1996. The primary function of the Nominating Committee is to make
recommendations to the Board concerning the selection of nominees for election
as directors. The Nominating Committee considers candidates suggested by
directors and stockholders of the Company in accordance with the Company's
By-Laws. Nominations by stockholders, properly submitted in writing to the
Secretary of the Company, are referred to the Nominating Committee for
consideration. The Nominating Committee will not review the selection of the
Purchaser Designees. The Board's Special Committee was formed in February 1997
and therefore did not meet during fiscal year 1996. The primary function of the
Special Committee is to review and evaluate strategic alternatives for the
Company, including but not limited to the Merger and possible alternative
transactions. The Board's Audit Committee held no meetings during fiscal year
1996. The primary function of the Audit Committee is to oversee the actions
taken by the Company's independent auditors and to review the Company's internal
financial and accounting controls and policies. The Board's Compensation
Committee met informally on several occasions and acted by written consent on
four occasions during fiscal year 1996. The primary function of the Compensation
Committee is to determine salaries, incentives and other forms of compensation
for executive officers and other employees of the Company and to administer the
incentive compensation, stock option and other benefit plans of the Company.
During fiscal year 1996, all members of the current Board, except for Mr.
Kidson, attended at least 75% of the total number of meetings of the Board of
Directors and the committees thereof on which they served during the time they
served on the Board of Directors and the committees thereof.

Members of the Company's Board of Directors do not receive compensation for
their services as directors, but directors are reimbursed for certain expenses
in connection with attendance at meetings of the Board of Directors and
committees. Non-employee directors of the Company may participate in the
Directors' Stock Option Plan (the "Directors' Plan"). The Directors' Plan
provides for the automatic grant of stock options to purchase 5,000 shares of
Common Stock on the date on which the stockholders of the Company elect
directors at an annual meeting. The exercise price for such stock options is the
fair market value of the Common Stock on the date of grant, and such stock
options are exercisable beginning on the first anniversary of the date of grant,
provided that the director receiving such options has not voluntarily resigned
or been removed "for cause" as a member of the Board of Directors prior to such
date. Pursuant to the Merger Agreement, all outstanding stock options (whether
or not exercisable) granted under the Directors' Plan will be cancelled
immediately prior to the effectiveness of the Merger for a cash payment equal to
the product of (x) the number of shares subject to stock options under such Plan
and (y) the excess of the price per Share to be paid in the Offer over the per
Share exercise prices for such stock options. Mr. Kidson has indicated to the
Company that he intends to assign to CIBC the proceeds to be paid in connection
with the Merger upon the cancellation or conversion of his stock options granted
under the Directors' Plan.

There are no family relationships among any of the directors or executive
officers of the Company.

EXECUTIVE OFFICERS OF THE COMPANY

The executive officers of the Company presently consist of Dr. Blum as
Chairman of the Board, Chief Executive Officer and Secretary; Steven A.
Bennington as President and Chief Operating Officer; Dr. Gupta as Executive Vice
President of Engineering, Research and Development; Horace N. Hudson, Jr. as
Vice President of Manufacturing; Sunder H. Malkani as Vice President of
Marketing; Robert P. Padula as Vice President of Sales and Customer Care; and Jo
Ann Swasey as Chief Financial Officer, Treasurer and Controller.

The following table sets forth certain information with respect to the
executive officers of the Company who are not also directors:

Steven A. Bennington has served the Company since August 1996 as President
and since September 1993 as Chief Operating Officer. From June 1992 until August
1996, Mr. Bennington served as Vice President of Operations of the Company. Mr.
Bennington served as Vice President -- International of Vismed, Inc., a

I-5
<PAGE> 20

manufacturer of in-office laminating systems, from September 1991 to June 1992.
In March 1991, Mr. Bennington founded and served beyond September 1991 as a
consultant for KSC International, a consulting firm for medical instrumentation,
eyewear and vision care companies. From September 1988 to February 1991, Mr.
Bennington served as Chief Executive Officer of TechnaVision, Inc., a
manufacturer of in-office whole lens thermal casting fabrication systems. From
August 1981 to September 1988, Mr. Bennington served as Vice President
Operations and then as Vice President -- International of Allergan Humphrey,
Inc. ("Allergan"), a manufacturer of diagnostic and surgical ophthalmic
instrumentation. Mr. Bennington is 47 years old.

Horace N. Hudson has served the Company as Director of Materials Research
since August 1993 and as Vice President of Manufacturing since December 1994.
From 1989 until August 1993, he worked as an independent consultant for several
companies in the ophthalmic products and equipment industry, including Garrett
Optical, Inc., Crossbows Optical Ltd. and Bausch & Lomb, Incorporated. He was
employed by Coburn Optical Industries, Inc., a manufacturer of surfacing
equipment and ophthalmic lens products, from 1972 until 1989, holding various
positions, including Vice President -- Operations. Mr. Hudson is 46 years old.

Sunder H. Malkani has served the Company as Vice President of Marketing
since October 1995. From April 1994 until October 1995, he served as a
consultant to the Company. From May 1990 until September 1995, Mr. Malkani
served as President of Healthcare Consultants, Inc., a consulting firm to
medical device companies. Mr. Malkani also served as Vice President of United
States Professional Products Group at Ciba Vision Corporation, an entity which
manufactures and distributes contact lenses, from 1985 to 1990. Mr. Malkani is
48 years old.

Robert P. Padula has served the Company as Vice President of Sales and
Customer Care since January 1995. Prior to such time, he served with different
responsibilities and a different title as Executive Vice President of Sales and
Marketing starting in February 1994. Before joining the Company, he was employed
by Allergan from 1981 to 1994 as Vice President of Sales and Service and in
several other positions. Mr. Padula is 39 years old.

Jo Ann Swasey has served the Company since February 1997 as Chief Financial
Officer, since October 1995 as Treasurer and since February 1993 as Controller.
From 1988 until February 1993, Ms. Swasey was an accountant with H. Schwarz &
Co. P.C., Public Accountants. Ms. Swasey is a certified public accountant. Ms.
Swasey is 33 years old.

I-6
<PAGE> 21

EXECUTIVE COMPENSATION

The following table sets forth, for the fiscal years ended December 31,
1996, 1995 and 1994, all compensation awarded to, earned by or paid to the
Company's Chief Executive Officer and each of the four other most highly
compensated executive officers of the Company (the "Named Executive Officers"):

SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
ANNUAL COMPENSATION ------------
----------------------------------- SECURITIES
NAME AND PRINCIPAL FISCAL OTHER ANNUAL UNDERLYING ALL OTHER
POSITION(S) YEAR SALARY BONUS COMPENSATION OPTIONS(#) COMPENSATION(1)
- ---------------------------- ------ -------- ------- ------------ ------------ ---------------
<S> <C> <C> <C> <C> <C> <C>
Ronald D. Blum, O.D......... 1996 $184,316 $52,155 -- 75,000 $ 661
Chairman, Chief Executive 1995 178,282 35,831 -- 804,992 --
Officer and Secretary 1994 150,449 -- -- -- --
Steven A. Bennington........ 1996 163,555 47,512 -- 75,000 3,590
President and Chief 1995 136,825 31,303 -- 81,602 --
Operating Officer 1994 114,672 25,000 $ 11,964(2) -- --
Amitava Gupta, Ph.D......... 1996 218,143(3) 58,425 -- 25,000 2,890
Executive Vice President
of 1995 208,469(3) 70,584 -- 202,613 --
Engineering, Research 1994 191,410 25,000 -- -- --
and Development
Sunder H. Malkani........... 1996 154,408(3) 25,737 -- -- --
Vice President of 1995(4) 84,642(3) -- -- 10,008 --
Marketing
Robert P. Padula............ 1996 129,769 41,760 -- 5,885 1,270
Vice President of Sales 1995 125,000 24,680 -- 44,191 --
and Customer Care 1994 105,769 -- -- 19,722 --
</TABLE>

- ---------------
(1) Represents insurance premiums paid by the Company with respect to the
covered fiscal year under disability and term life insurance policies for
the benefit of the Named Executive Officer.

(2) Represents forgiveness of a loan payable to the Company.

(3) Includes certain housing expenses paid for by the Company on behalf of the
Named Executive Officers.

(4) Mr. Malkani became employed by the Company in October 1995. Includes
consulting fees paid during fiscal year 1995 prior to his employment by the
Company.

OPTION GRANTS IN LAST FISCAL YEAR

The following table provides information concerning grants of stock options
to purchase shares of Common Stock made during the fiscal year ended December
31, 1996 to the Named Executive Officers:

<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
INDIVIDUAL GRANTS VALUE AT ASSUMED
-------------------------------------------------- ANNUAL RATES OF
NUMBER OF % OF TOTAL STOCK PRICE
SECURITIES OPTIONS EXERCISE APPRECIATION FOR
UNDERLYING GRANTED TO PRICE PER OPTION TERM (1)
OPTIONS EMPLOYEES IN SHARE EXPIRATION ---------------------
NAME GRANTED(#) FISCAL YEAR ($/SH) DATE 5% 10%
- ------------------------------- ---------- ------------ --------- ---------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Ronald D. Blum, O.D............ 75,000 24.3% $9.00 10/16/06 $122,167 $194,531
Steven A. Bennington........... 25,000(2) 8.1 9.00 10/16/06 40,722 64,844
50,000(2) 16.3 9.00 10/16/06 81,445 129,687
Amitava Gupta, Ph.D............ 25,000 8.1 9.00 10/16/06 40,722 64,844
Robert P. Padula............... 5,885 1.9 9.00 10/16/06 9,586 15,264
</TABLE>

- ---------------
(1) Potential realizable value is based on the assumption that the Common Stock
appreciates at the annual rates shown (compounded annually) from the date of
grant until the expiration of the option term. These numbers are calculated
based on the requirements promulgated by the Securities and Exchange

I-7
<PAGE> 22

Commission and do not reflect any estimate or prediction by the Company of
future Common Stock price increases.

(2) Such stock options are subject to different vesting schedules.

AGGREGATE OPTION EXERCISES IN LAST FISCAL YEAR AND
FISCAL YEAR-END OPTION VALUES

The following table sets forth certain information regarding the stock
options held as of December 31, 1996 by the Named Executive Officers. No stock
options were exercised by the Named Executive Officers in fiscal year 1996.

<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED OPTIONS AT IN-THE-MONEY OPTIONS AT
DECEMBER 31, 1996(#) DECEMBER 31, 1996(1)
----------------------------- -----------------------------
NAME EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ------------------------------------------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
Ronald D. Blum, O.D........................ 716,856 163,136 $ 543,779 $ 1,155,531
Steven A. Bennington....................... 100,274 81,212 185,404 143,542
Amitava Gupta, Ph.D........................ 185,902 76,404 321,039 453,049
Sunder H. Malkani.......................... 6,659 3,349 12,089 25,690
Robert P. Padula........................... 47,972 21,827 39,042 69,712
</TABLE>

- ---------------
(1) Amount reflects the market value of the underlying shares of Common Stock as
reported on the Nasdaq National Market on December 31, 1996 ($7.75 per
share) less the aggregate exercise prices of the stock options.

Pursuant to the Merger Agreement, all outstanding stock options (whether or
not exercisable) will be cancelled immediately prior to the effectiveness of the
Merger for a cash payment equal to the product of (x) the number of shares
subject to the stock options and (y) the excess of the price per Share to be
paid in the Offer over the per Share exercise prices for such stock options.

EMPLOYMENT AGREEMENTS AND TERMINATION ARRANGEMENTS

The Company has entered into employment agreements with Drs. Blum and Gupta
and Messrs. Bennington, Malkani and Padula. Each of the employment agreements
provides for the officer's employment in his current position(s) through the
respective dates set forth below, subject to earlier termination by the Company
or the executive officer. The terms of employment for Drs. Blum and Gupta expire
on August 31, 1998, the term of employment for Mr. Bennington expires on August
13, 1998, the term of employment for Mr. Malkani expires on October 2, 1997, and
the term of employment for Mr. Padula expires on November 30, 1997. The terms of
such agreements (except Mr. Malkani's agreement) will be extended automatically
each year for an additional one-year period unless the executive officer or the
Company provides notice that he or it does not desire to extend the term.
Pursuant to their respective employment agreements, Dr. Blum receives an annual
base salary of $190,000, Dr. Gupta receives an annual base salary of $205,000,
Mr. Bennington receives an annual base salary of $175,000, Mr. Malkani receives
an annual base salary of $115,000, and Mr. Padula receives an annual base salary
of $145,000. Until December 31, 1996, the Company reimbursed Dr. Gupta for
certain housing expenses up to $14,000 per year. In addition, the Company
reimburses Mr. Malkani for certain housing expenses. Certain of such employment
agreements provide that the officer will receive specified bonuses, stock option
awards and other employee benefits, as the case may be.

Under Dr. Blum's employment agreement, the Company has agreed to use its
best efforts to cause the election of Dr. Blum to the Board until such time as
he no longer owns 10% of the Common Stock on a fully-diluted basis and he no
longer is an officer of the Company. Also, the Company has agreed to make
available not less than $250,000 per year during the term of his employment for
research and development activities, as determined by Dr. Blum, on behalf of the
Company.

I-8
<PAGE> 23

Each of the foregoing employment agreements provides for certain payments
upon termination of the officer's employment as a result of a material breach by
the Company of the officer's employment agreement or a termination by the
Company without Cause (as defined in the employment agreements). A material
breach by the Company of the employment agreements includes a material change in
the officer's responsibilities. In such event, Dr. Blum would be entitled to
receive a lump-sum payment equal to $190,000, payments of annual base salary for
the longer of 12 months and the unexpired portion of the employment term and a
lump-sum equal to $20,833 multiplied by the number of full or partial months
comprising the unexpired portion of the employment term. Dr. Gupta would be
entitled to receive severance payments of annual base salary for the longer of
12 months and the unexpired portion of the employment term, plus a pro rata
portion of bonus accrued through the date of termination. Mr. Bennington would
be entitled to receive severance payments of annual base salary for the longer
of 12 months and the unexpired portion of the employment term, plus a pro rata
portion of bonus accrued through the date of termination. Mr. Malkani would be
entitled to receive severance payments amounting to 6 months of his annual base
salary, plus a pro rata portion of bonus accrued through the date of
termination. Mr. Padula would be entitled to severance payments amounting to 12
months of his annual base salary, plus a pro rata portion of bonus accrued
through the date of termination. In addition, certain stock options held by each
of the Named Executive Officers will become immediately exercisable upon
termination of such Named Executive Officer's employment, subject to certain
conditions.

The Company has obtained key man life insurance in the aggregate amounts of
$2,500,000, $2,250,000 and $250,000 on the lives of Drs. Blum and Gupta and Mr.
Bennington, respectively. The Company's lenders are the named beneficiaries for
such insurance in the aggregate amount of $4,250,000. In addition, the Company
pays the premiums for term life insurance policies which are owned by Dr. Gupta
and Messrs. Bennington, Malkani and Padula, and for a disability policy which is
owned by Dr. Blum.

The commencement of the Offer and/or the Merger will constitute a change in
control under certain of the Company's stock option plans and stock option
agreements. Upon a change of control, as defined in such stock option plans and
agreements, stock options under such plans and agreements will become fully
vested, subject to the other terms of the applicable stock option plans and
agreements.

I-9
<PAGE> 24

PERFORMANCE GRAPH

The following graph compares the cumulative stockholder return on the
Common Stock from March 15, 1996 (the date following the Company's initial
public offering) through December 31, 1996 with the cumulative return, including
the reinvestment of dividends, of an investment in (a) the Nasdaq Stock Market
Index of United States Companies, as published (the "Index"), and (b) a peer
group selected by the Company, weighted by market capitalization. The peer group
consists of the following ophthalmic companies: BEC Group Inc., Bausch & Lomb
Incorporated, Corning Incorporated, De Rigo S.p.A., Gerber Scientific Inc. and
Sola International Inc. The graph assumes that an investment of $100 was made on
March 15, 1996, in the Company, the Index and the peer group. Although the
Company believes it has chosen a peer group containing companies whose
businesses are comparable to the Company's primary business segment, ophthalmic
products, certain companies in such group are engaged in businesses other than
the ophthalmic products business and such other businesses may provide a large
portion of such companies' revenues and earnings. In addition, such companies
have been engaged in the ophthalmic products business for a significantly longer
period of time than the Company.

[GRAPH]

I-10
<PAGE> 25

PRINCIPAL HOLDERS OF VOTING SECURITIES

The following table sets forth, as of the close of business on February 14,
1997, the beneficial ownership of Common Stock by (a) any person who is known by
the Company to be the beneficial owner of more than five (5%) percent of any
class of voting securities of the Company (based upon information in any
Schedules 13D or Schedules 13G, as amended, furnished by such persons), (b) each
director of the Company, (c) each Named Executive Officer and (d) all directors
and current executive officers of the Company as a group (based upon information
furnished by such persons on or prior to such date). Beneficial ownership has
been determined in accordance with Rule 13d-3 under the Securities Exchange Act
of 1934. Under this Rule, certain Shares may be deemed to be beneficially owned
by more than one person (if, for example, persons share the power to vote or the
power to dispose of the Shares). In addition, Shares are deemed to be
beneficially owned by a person if the person has the right to acquire the Shares
(for example, upon exercise of an option) within 60 days of the date as of which
the information is provided, and in computing the percentage ownership of any
person, the amount of Shares is deemed to include the amount of Shares
beneficially owned by such person (and only such person) by reason of these
acquisition rights. As a result, the percentage of outstanding Shares of any
person as shown in the following table does not necessarily reflect the person's
actual voting power at any particular date. The address of all directors of the
Company and the Named Executive Officers is in care of Innotech, Inc., 5568
Airport Road, Roanoke, Virginia 24012.

<TABLE>
<CAPTION>
SHARES PERCENTAGE
BENEFICIAL OWNER BENEFICIALLY OWNED(1) BENEFICIALLY OWNED(1)
------------------------------------------------- --------------------- ---------------------
<S> <C> <C>
Chase Venture Capital Associates, L.P.**......... 2,210,323 24.7%
c/o Chase Capital Partners
270 Park Avenue
New York, NY 10017
CIBC Wood Gundy Ventures, Inc.**................. 779,007 8.7%
425 Lexington Avenue
New York, NY 10017
SBIC Partners, L.P............................... 561,701 6.3%
201 Main Street, Suite 2302
Fort Worth, TX 76102
Johnson & Johnson Development Corporation........ 474,515 5.3%
One Johnson & Johnson Plaza
New Brunswick, NJ 08933(2)
Ronald D. Blum, O.D.(3)**........................ 1,062,116 11.0%
Steven A. Bennington(3).......................... 100,276 1.1%
Amitava Gupta, Ph.D(3)........................... 197,153 2.2%
Sunder H. Malkani(3)............................. 6,659 *
Robert P. Padula(3).............................. 49,199 *
Gregory J. Forrest(4)............................ -- *
Ian M. Kidson(5)................................. -- *
Michael B. Packard(6)............................ -- *
Damion E. Wicker, M.D.(7)........................ 2,210,323 24.7%
All directors and executive officers as a group
(11 persons)(3)(8)............................. 3,667,494 36.5%
</TABLE>

- ---------------
* Less than one percent (1%) of the outstanding shares of Common Stock.

** The Company has been informed that such stockholders intend to file a
Schedule 13D with respect to the Shares subject to the Stockholder Agreement
on or about February 18, 1997. See "CERTAIN RELATIONSHIPS AND RELATED
TRANSACTIONS."

(1) Except as indicated by footnote, and subject to community property laws
where applicable, to the Company's knowledge, the persons or entities named
in the table above have sole voting and investment power with respect to all
Shares shown as beneficially owned by them.

I-11
<PAGE> 26

(2) Does not include 3,331,608 outstanding Shares beneficially owned by Dr.
Blum, CVCA and CIBC, representing approximately 37% of the outstanding
Shares, which the Purchaser has a right to acquire pursuant to the
Stockholder Agreement. See "CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS."
Johnson & Johnson Development Corporation and the Purchaser are affiliates
of the Parent.

(3) Includes with respect to Drs. Blum and Gupta and Messrs. Bennington, Malkani
and Padula, 716,856, 185,901, 100,276, 6,659 and 47,971 Shares,
respectively, issuable pursuant to stock options exercisable on or before
April 15, 1997. Also includes for Dr. Blum 2,983 Shares owned by Dr. Blum's
children. Does not give effect to acceleration of stock options held by the
Named Executive Officers in connection with the Offer and the Merger.

(4) Excludes Shares owned by SBIC Partners, L.P. ("SBIC Partners"). SBIC
Partners is the beneficial owner of all Shares registered in its name.
Forrest Binkley & Brown L.P., a Texas limited partnership ("FBB"), is the
managing general partner of SBIC Partners and Forrest Binkley & Brown
Venture Co., a Texas corporation ("FBB Venture Co."), is the sole general
partner of FBB. Mr. Forrest is a limited partner of FBB and is an executive
officer, director and stockholder of FBB Venture Co. Mr. Forrest disclaims
beneficial ownership of all Shares owned by SBIC Partners.

(5) Excludes Shares owned by CIBC. Mr. Kidson, a Managing Director of CIBC Wood
Gundy Securities, Inc. (an entity affiliated with CIBC), disclaims
beneficial ownership of all Shares owned by CIBC.

(6) Excludes Shares beneficially owned by the parent company of LensCrafters,
Inc. Mr. Packard, Executive Vice President of LensCrafters, Inc., disclaims
beneficial ownership of all Shares owned by the parent company of
LensCrafters, Inc.

(7) Reflects 2,210,323 Shares deemed beneficially owned by CVCA. Dr. Wicker is a
Partner of Chase Capital Partners, the general partner of CVCA. Dr. Wicker
disclaims beneficial ownership of all Shares owned by CVCA.

(8) Includes an aggregate of 1,099,432 Shares issuable pursuant to stock options
exercisable on or before April 15, 1997 held by the executive officers of
the Company. Does not give effect to acceleration of stock options held by
the executive officers of the Company in connection with the Offer and the
Merger.

I-12
<PAGE> 27

COMPENSATION COMMITTEE REPORT

The Compensation Committee of the Board of Directors (the "Compensation
Committee"), consisting entirely of non-employee directors, approves all of the
policies and programs pursuant to which compensation is paid or awarded to the
Company's executive officers. The Compensation Committee met informally on
several occasions and acted by unanimous written consent on four occasions
during fiscal year 1996.

GENERAL POLICIES REGARDING COMPENSATION OF EXECUTIVE OFFICERS. The
Company's executive compensation policies are intended to (a) attract and retain
high quality managerial and executive talent and to motivate these individuals
to maximize stockholder returns, (b) afford appropriate incentives for
executives to produce sustained superior performance and (c) reward executives
for superior individual contributions to the achievement of the Company's
business objectives. The Company's compensation structure consists of base
salary, annual cash bonuses and stock options. Together these components are
intended to link each executive's compensation to his/her individual performance
and the Company's overall performance.

Salary. Base salary levels are intended to reflect individual positions,
responsibilities, experience, leadership and potential contribution to the
success of the Company. Actual salaries vary based upon the Compensation
Committee's subjective assessment of the individual executive's performance and
of the Company's performance. Each executive officer has entered into an
employment agreement with the Company which sets forth the base salary for such
executive officer.

Bonuses. Executive officers are eligible to receive annual bonuses based
upon the achievement of certain objective and subjective performance goals which
the Compensation Committee establishes annually under the Company's Management
Incentive Compensation Plan. The performance goals for each executive officer
are established based upon the executive officer's responsibilities within the
Company. For fiscal year 1996, the Compensation Committee established that the
maximum bonus that an executive officer could receive for that year was 30% of
the executive officer's base salary at the end of the year.

Stock Options. Stock options, which are granted at or above the fair
market value of a share of Common Stock on the date of grant, are currently the
only long-term compensation vehicle utilized by the Company. Stock options are
intended to provide employees with sufficient incentive to manage from the
perspective of an owner with an equity stake in the business. In determining the
size of individual stock option grants, the Compensation Committee considers the
aggregate number of shares available for grant and the number of individuals to
be considered for an award of stock options. The number, timing, length and
vesting provisions of stock option grants to executive officers are decided by
the Compensation Committee based upon its subjective assessment of the
performance of each grantee. In determining such terms of stock option grants,
the Compensation Committee considers the position and responsibilities of the
executive officer, the length of service of the executive officer with the
Company, the present and potential contribution of the executive officer to the
Company and the overall performance of the Company. The Compensation Committee
believes that grants of stock options will enable the Company to attract and
retain high caliber talent and to encourage a high level of performance.

COMPENSATION OF THE CHIEF EXECUTIVE OFFICER FOR FISCAL YEAR 1996. The
Compensation Committee approved an amendment to Dr. Blum's employment agreement
in October 1996. The amendment increased Dr. Blum's base salary by $15,000 to
$190,000. The amendment was one of several such amendments authorized by the
Compensation Committee to employment agreements to increase the base salaries of
certain executive officers of the Company. The Compensation Committee authorized
these increases to reflect cost of living adjustments for such executive
officers and to reflect the increased responsibilities of such executive
officers in connection with the Company's growth.

In addition to his base salary, the Compensation Committee awarded Dr. Blum
a performance bonus of $52,155 for fiscal year 1996. This performance bonus was
based upon Dr. Blum's achievement of the objective performance goals which the
Compensation Committee established for him. These performance goals established
for Dr. Blum were based upon a weighted average of financial, sales and stock
price objectives, achievement of commercialization of certain products,
formation of certain strategic alliances and achievement of a reduction in
certain production costs.

I-13
<PAGE> 28

In October 1996, the Compensation Committee awarded Dr. Blum stock options
to purchase 75,000 shares of Common Stock at an exercise price of $9.00 per
share. At the time stock options were granted to Dr. Blum, stock options were
granted to almost all other executive officers of the Company. The number of
shares underlying each such option grant and the vesting of such stock options
were determined based upon the responsibilities of the executive officer and the
executive officer's length of service with the Company. In Dr. Blum's case,
these stock options were also granted in recognition of Dr. Blum's efforts in
connection with the successful completion of the Company's initial public
offering in March 1996, which strengthened the Company's financial position.

Section 162(m) of the Internal Revenue Code of 1986, as amended, generally
limits deductions to public companies for Federal income tax purposes for
certain executive compensation in excess of $1 million paid to the Named
Executive Officers. Qualifying performance-based compensation and compensation
paid pursuant to plans adopted prior to a company's public offering of
securities, including, in the case of the Company, Base Stock Options and
Success Stock Options, will not be subject to the deduction limitation if
certain requirements are met. In addition, certain types of compensation are
deductible only if performance criteria are specified in detail and payments are
contingent upon stockholder approval of the compensation arrangement. The
compensation paid by the Company for fiscal year 1996 to the Named Executives
did not exceed such $1 million limitation.

COMPENSATION COMMITTEE

Ian M. Kidson
Michael B. Packard
Damion E. Wicker

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION. The
Compensation Committee conducted deliberations concerning executive compensation
during the last completed fiscal year. None of the Compensation Committee
members are executive officers of the Company. None of the executive officers of
the Company has served on the board of directors or on the compensation
committee of any other entity, any of whose officers served on the Board.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

As a public company, the Company's directors, executive officers and more
than 10% beneficial owners are subject to the reporting requirements of Section
16(a) of the Securities Exchange Act of 1934. Based solely upon a review of
Forms 3, 4, and 5, and amendments thereto, furnished to the Company during or
for fiscal year 1996, or written representations from such persons that no Forms
5 were required, the requirements of Section 16(a) were compiled with, except
that Dr. Wicker filed late his Initial Statement of Beneficial Ownership of
Securities on Form 3, and Drs. Blum and Gupta and Mr. Padula each filed late one
Statement of Changes of Beneficial Ownership of Securities on Form 4, during
fiscal year 1996.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Effective July 19, 1996, the Company and Dr. Blum entered into a Put/Call
Agreement. This Agreement provided for the sale by Dr. Blum and his permitted
assigns to the Company and for the purchase by the Company from Dr. Blum of an
aggregate of 85,000 Shares. The exercise price for the put and call under such
Agreement was $9.81 per Share. The Put/Call Agreement was scheduled to expire on
September 10, 1997. The Board of Directors of the Company terminated the
Put/Call Agreement on February 10, 1997. However, the Board of Directors
terminated such Agreement because it believed that the Company's liquidity could
be adversely affected in the event that the Merger failed to occur, the stock
price of the Common Stock decreased and the put to the Company under such
Agreement were exercised by Dr. Blum.

In fiscal year 1996, CVCA exercised warrants to purchase an aggregate of
881,664 Shares for an aggregate exercise price of $6,965, Dr. Blum exercised
warrants to purchase an aggregate of 1,131

I-14
<PAGE> 29

Shares for an aggregate purchase price of $89, and Mr. Padula exercised warrants
to purchase an aggregate of 566 Shares for an aggregate purchase price of $44.

On October 15, 1996, the Company consummated the purchase of a warrant (the
"Prism Warrant") to acquire 15% of the outstanding units of Prism Ophthalmics
L.L.C. ("Prism") and the purchase of an option (the "Prism Option") to acquire
all of the outstanding equity interests of Prism. Prism is a newly created
entity which owns a United States patent and has filed two patent applications
for lenses which are surgically implanted in the eye and are designed to improve
central field loss, a cause of blindness. The Company paid to Prism a purchase
price of $1,165,000 for the Prism Warrant, which is exercisable at any time on
or before December 31, 2001, at an exercise price of $150. The purchase price
for the Prism Option was $400,000, and, if exercised, will require the payment
of $5,000,000 for the acquisition by the Company of all of the outstanding
equity interests of Prism. The exercise of the Prism Option is not conditioned
upon the exercise of the Prism Warrant. The purchase price for the Prism Option
and the Prism Warrant is required to be used solely by Prism for development and
commercialization of Prism's proprietary technology. Dr. Gupta, the Executive
Vice President of Engineering, Research and Development, and a director of the
Company, and his wife are the owners of approximately 46% of the outstanding
units of Prism. The Company permits Dr. Gupta to allocate approximately 20% of
his business time to the operations of Prism. Under the terms of the Merger
Agreement, the Company may not exercise the Prism Option without the Parent's
consent until the earlier of the termination of the Merger Agreement and the
Effective Time.

In connection with the Merger, Dr. Blum, CVCA, CIBC, the Parent and the
Purchaser entered into a Stockholder Agreement, dated as of February 10, 1997
(the "Stockholder Agreement"). Pursuant to the Stockholder Agreement, each of
CVCA, CIBC and Dr. Blum has agreed to sell, and the Purchaser has agreed to
purchase, all 3,331,608 Shares owned by them, representing approximately 37% of
the outstanding Shares, at a price per Share equal to $13.75. Such obligations
to sell and to purchase are subject to the Purchaser having accepted Shares for
payment under, and subject to the conditions of, the Offer. The Stockholder
Agreement also provides that each of CVCA, CIBC and Dr. Blum may, and at the
request of the Purchaser will, tender its or his Shares subject to the
Stockholder Agreement in the Offer. Any Shares owned by CVCA, CIBC or Dr. Blum
not purchased in the Offer will be purchased at the same time as payment is made
pursuant to the Offer.

Pursuant to the Stockholder Agreement, each of CVCA, CIBC and Dr. Blum has
agreed, until the Stockholder Agreement has terminated, among other things, not
to: (a) sell, transfer, give, pledge or otherwise dispose of, or enter into any
contract, option or other arrangement with respect to the sale, transfer,
pledge, assignment or other disposition of, the Shares subject to the
Stockholder Agreement owned by such party other than pursuant to the terms of
the Offer or the Merger; (b) enter into any voting arrangement, whether by
proxy, voting agreement or otherwise, in connection with, directly or
indirectly, any Takeover Proposal (as defined in the Stockholder Agreement); (c)
directly or indirectly solicit, initiate or encourage the submission of, any
Takeover Proposal; or (d) directly or indirectly participate in any discussions
or negotiations regarding, or furnish to any person any information with respect
to, or take any other action to facilitate any inquiries or the making of any
proposal that constitutes, or may reasonably be expected to lead to, any
Takeover Proposal; provided, that clause (d) will not be deemed to have been
violated if in response to an unsolicited inquiry, such party states that it or
he is subject to the provisions of the Stockholder Agreement. The Stockholder
Agreement, by reference to the Merger Agreement, defines "Takeover Proposal" as
any proposal or offer from any person relating to any direct or indirect
acquisition or purchase of 20% or more of the assets of the Company or 20% or
more of any class of outstanding equity securities of the Company, any tender
offer or exchange offer that if consummated would result in any person
beneficially owning 20% or more of any class of equity securities of the Company
or any merger, consolidation, business combination, sale of substantially all
the assets, recapitalization, liquidation, dissolution or similar transaction
involving the Company, other than the transactions contemplated by Merger
Agreement.

Each of CVCA, CIBC and Dr. Blum has also agreed, and the Stockholder
Agreement includes an irrevocable proxy provision for the benefit of the
Purchaser with respect to the Shares subject to the Stockholder Agreement owned
by such party, to, until the Stockholder Agreement has terminated, vote such
Shares (a) at any meeting of stockholders of the Company called to vote upon the
Merger and the Merger

I-15
<PAGE> 30

Agreement or at any adjournment thereof or in any other circumstances upon which
a vote, consent or other approval (including by written consent) with respect to
the Merger and the Merger Agreement is sought, in favor of the Merger, the
adoption by the Company of the Merger Agreement and the approval of the terms
thereof and each of the other transactions contemplated by the Merger Agreement
and (b) at any meeting of stockholders of the Company or any adjournment thereof
or in any other circumstances upon which such party's vote, consent or other
approval is sought, against (x) any Takeover Proposal or (y) any amendment of
the Company's Certificate of Incorporation or By-Laws or other proposal or
transaction involving the Company, which amendment or other proposal or
transaction would be reasonably likely to impede, frustrate, prevent or nullify
the Merger, the Merger Agreement or any of the other transactions contemplated
by the Merger Agreement or change in any manner the voting rights of each class
of the Common Stock.

The Stockholder Agreement provides that in the event that the Merger
Agreement has been terminated under circumstances where the Parent is or may
become entitled to receive the Termination Fee (as defined in the Stockholder
Agreement), each of CVCA, CIBC and Dr. Blum will pay to the Parent on demand an
amount equal to the difference between the consideration received by such party
from the consummation of any transaction which gives rise to the Company's
obligation to pay the Termination Fee pursuant to the Merger Agreement and the
consideration such party would have received had it or he tendered its or his
Shares pursuant to the Offer (without taking into account any modifications to
the Offer as in effect on February 18, 1997), as determined in accordance with
the Stockholder Agreement. The Stockholder Agreement, by reference to the Merger
Agreement, defines "Termination Fee" as a fee equal to $6.25 million plus up to
$500,000 in reimbursement of expenses payable by the Company to Parent in the
event the Merger Agreement is terminated by the Parent or the Company under
certain circumstances.

In addition, in the event that (a) prior to the Effective Time, a Takeover
Proposal has been made and (b) the Effective Time has occurred and the Parent
for any reason has increased the amount of the per Share price payable in the
Offer in cash, without interest, over that set forth in the Merger Agreement in
effect on the date thereof (the "Original Merger Consideration"), each of CVCA,
CIBC and Dr. Blum agrees in the Stockholder Agreement to pay to the Parent on
demand an amount in cash equal to the product of (i) the number of Shares of
such party subject to the Stockholder Agreement and (ii) 100% of the excess, if
any, of (A) the per Share cash consideration or the per Share fair market value
of any noncash consideration, as the case may be, received by such party as a
result of the Merger, as amended, determined as of the Effective Time, over (B)
the amount of the Original Merger Consideration determined as of the time of the
first increase in the amount of the Original Merger Consideration.

I-16
<PAGE> 31

SCHEDULE II
[PRUDENTIAL SECURITIES LETTERHEAD]

PRIVATE AND CONFIDENTIAL

February 10, 1997
Board of Directors
Innotech, Inc.
5568 Airport Road
Roanoke, Virginia 24012

Members of the Board:

We understand that Johnson & Johnson, a New Jersey corporation ("Parent"),
INO Acquisition Corp., a Delaware corporation and a wholly-owned subsidiary of
Parent ("Sub"), and Innotech, Inc., a Delaware corporation (the "Company"),
propose to enter into an agreement and plan of merger (the "Agreement") pursuant
to which Parent will cause Sub to commence a tender offer (the "Offer") to
purchase all of the outstanding shares (the "Shares") of common stock, par value
$0.001 per share, of the Company for $13.75 per Share, net to the sellers in
cash. As a condition to the purchase of Shares by Sub pursuant to the Offer (i)
a majority of the currently outstanding Shares; and (ii) a majority of the
Shares, on a fully diluted basis, must be validly tendered in the Offer and not
withdrawn. Following consummation of the Offer, Sub will merge with and into the
Company (the "Merger") and any Shares not purchased in the Offer will be
converted into the right to receive $13.75 in cash. We further understand that
concurrently with the execution of the Agreement, Parent, Sub and certain
stockholders of the Company propose to enter into a stockholder agreement (the
"Stockholder Agreement") pursuant to which such stockholders will, among other
things, agree to sell their Shares to Sub for $13.75 per Share, or such higher
price per Share as may be offered by Sub in the Offer.

You have requested our opinion as to the fairness from a financial point of
view to the stockholders of the Company of the cash consideration to be received
by such stockholders in the Offer and the Merger.

In conducting our analysis and arriving at the opinion expressed herein, we
have reviewed such materials and considered such financial and other factors we
deemed relevant under the circumstances, including:

(i) a draft dated February 9, 1997 of the Agreement;

(ii) a draft dated February 9, 1997 of the Stockholder Agreement;

(iii) certain publicly available historical financial and operating
data concerning the Company including the Annual Report to stockholders for
the year ended December 31, 1995, the Quarterly Reports on Form 10-Q for
the quarters ended September 30, 1996, June 30, 1996 and March 31, 1996 and
the Company's prospectus, dated March 14, 1996 relating to the initial
public offering of the Shares;

(iv) certain information of the Company, including financial forecasts
relating to the business, earnings, cash flow, assets and prospects of the
Company prepared by the management of the Company in February 1996;

(v) publicly available financial, operating and stock market data
concerning certain companies engaged in businesses we deemed relatively
comparable to the Company or otherwise relevant to our inquiry;

(vi) the financial terms of certain recent transactions we deemed
relevant;

(vii) the historical market prices and trading volumes of the Shares;
and

(viii) such other financial studies, analyses and investigations we
deemed appropriate.

II-1
<PAGE> 32

[PRUDENTIAL SECURITIES LETTERHEAD]

We have, with your approval, assumed that the foregoing agreements when
executed by the parties thereto, will conform in all material respects to the
drafts of such agreements which we reviewed.

We have met with members of the senior management of the Company to discuss
(i) the prospects for the Company's business including management's view as to
the value of the Company's product development efforts, (ii) management's
estimate of the Company's future financial performance and (iii) such other
matters we deemed relevant.

In connection with our review and analysis and in arriving at our opinion,
we have relied upon the accuracy and completeness of the financial and other
information provided to us by the Company and have not undertaken any
independent verification of such information or undertaken an independent
appraisal of the assets of the Company. With respect to the financial forecasts
provided to us by the Company including management's view as to the value of the
Company's product development efforts, we have assumed that such forecasts have
been reasonably prepared and represent management's best currently available
estimate as to the future financial performance of the Company and such product
development efforts. Further, our opinion is necessarily based on economic,
financial and market conditions as they exist and can be evaluated as of the
date hereof and we assume no responsibility to update or revise this opinion
based upon events or circumstances occurring after the date hereof.

We were retained by the Company pursuant to a letter agreement dated
February 4, 1997 to render this opinion to the Board of Directors and provide
other financial advisory services in connection with the Offer and the Merger.
We were not requested to, nor did we, solicit indications of interest from third
parties to merge with or otherwise acquire the Company. We have received a
retainer fee for our services, and will receive an additional advisory fee which
is contingent upon the consummation of the Offer. In addition, in the ordinary
course of business Prudential Securities Incorporated may trade Shares for its
own account and for the accounts of customers and, accordingly, may at any time
hold a long or short position in the Shares.

This letter and the opinion expressed herein are for the use of the Board
of Directors of the Company. This opinion does not constitute a recommendation
to the stockholders of the Company as to whether such stockholders should tender
their Shares in the Offer or vote in favor of the Merger. This opinion may not
be reproduced, summarized, excerpted from or otherwise publicly referred to or
disclosed in any manner, without our prior written consent, except that the
Company may include this opinion in its entirety in any disclosure document to
be sent to the Company's stockholders or filed with the Securities and Exchange
Commission relating to the Offer or the Merger.

Based upon and subject to the foregoing, we are of the opinion that, as of
the date hereof, the cash consideration to be received by the stockholders of
the Company in the Offer and the Merger is fair from a financial point of view
to such stockholders.

Very truly yours,

/s/ Prudential Securities Incorporated

PRUDENTIAL SECURITIES INCORPORATED

II-2
<PAGE> 33

EXHIBIT INDEX

<TABLE>
<CAPTION>
EXHIBIT DESCRIPTION PAGE NO.
----------- ------------------------------------------------------------------- --------
<S> <C> <C>
Exhibit A Agreement and Plan of Merger, dated as of February 10, 1997, by and
among Johnson & Johnson, INO Acquisition Corp. and Innotech, Inc.
(incorporated by reference to Exhibit (c)(1) of the Schedule 14D-1
of INO Acquisition Corp. and Johnson & Johnson filed with the
Securities and Exchange Commission on February 18, 1997 (the
"Schedule 14D-1")).
Exhibit B Stockholder Agreement, dated as of February 10, 1997, by and among
Johnson & Johnson, INO Acquisition Corp., Innotech, Inc. and Chase
Venture Capital Associates, L.P., CIBC Wood Gundy Ventures, Inc.
and Ronald D. Blum, O.D. (incorporated by reference to Exhibit
(c)(2) of the Schedule 14D-1).
Exhibit C Joint Press Release of Johnson & Johnson and Innotech, Inc., dated
February 11, 1997 (incorporated by reference to Exhibit (a)(8) of
the Schedule 14D-1).
Exhibit D Letter to Stockholders of Innotech, Inc., dated February 18, 1997.*
Exhibit E [Intentionally Omitted].
Exhibit F Amended and Restated Employment Agreement, between Innotech, Inc.
and Robert P. Padula, dated September 19, 1996.
Exhibit G Amendment to Employment Agreement, between Innotech, Inc. and
Horace N. Hudson, dated October 16, 1996.
Exhibit H Amendment to Amended and Restated Employment Agreement, between
Innotech, Inc. and Dr. Amitava Gupta, dated October 16, 1996.
Exhibit I Amendment to Employment Agreement, between Innotech, Inc. and Dr.
Ronald D. Blum, dated October 16, 1996.
Exhibit J Third Amended and Restated Employment Agreement, between Innotech,
Inc. and Steven A. Bennington, dated October 16, 1996.
Exhibit K Employment Agreement, between Innotech, Inc. and Sunder H. Malkani,
dated October 2, 1995.
Exhibit L Employment Agreement, between Innotech, Inc. and Jo Ann Swasey,
dated April 1, 1996.
Exhibit M Noncompetition Agreement, between Johnson & Johnson and Dr. Ronald
D. Blum, dated February 10, 1997.
Exhibit N Noncompetition Agreement, between Johnson & Johnson and Dr. Amitava
Gupta, dated February 10, 1997.
Exhibit O Noncompetition Agreement, between Johnson & Johnson and Steven A.
Bennington, dated February 10, 1997.
Exhibit P Noncompetition Agreement, between Johnson & Johnson and Robert P.
Padula, dated February 10, 1997.
Exhibit Q Noncompetition Agreement, between Johnson & Johnson and Horace N.
Hudson, dated February 10, 1997.
Exhibit R Noncompetition Agreement, between Johnson & Johnson and Jo Ann
Swasey, dated February 10, 1997.
Exhibit S Noncompetition Agreement, between Johnson & Johnson and Sunder H.
Malkani, dated February 10, 1997.
Exhibit T Offer to Purchase, dated February 18, 1997 (incorporated by
reference to Exhibit (a)(1) of the Schedule 14D-1).**
Exhibit U Letter of Transmittal (incorporated by reference to Exhibit (a)(2)
of the Schedule 14D-1).**
</TABLE>

- ---------------
* Included in the Schedule 14D-9 materials being mailed to Company
stockholders.

** Included in the offer to purchase materials being mailed to Company
stockholders.

<PAGE> 1
Exhibit D

[INNOTECH LOGO]
February 18, 1997

Dear Stockholder:

We are pleased to inform you that on February 10, 1997, Innotech, Inc.
entered into an Agreement and Plan of Merger with Johnson & Johnson and INO
Acquisition Corp., a wholly-owned subsidiary of Johnson & Johnson, which
provides for the acquisition of all of the Common Stock of Innotech at a price
of $13.75 per share, payable in cash. Under the terms of the Merger Agreement,
on February 18, 1997, INO Acquisition Corp. commenced a tender offer to purchase
all of the outstanding shares of Innotech's Common Stock not already owned by
Johnson & Johnson, INO Acquisition Corp. or any other subsidiary of Johnson &
Johnson at a cash price of $13.75 per share. The Merger Agreement provides that,
subject to the satisfaction or waiver of certain conditions, the tender offer
will be followed by a merger of INO Acquisition Corp. with and into Innotech, in
which case those shares that are not purchased in the tender offer (other than
shares held in Innotech's treasury, by Johnson & Johnson, INO Acquisition Corp.
or any other subsidiary of Johnson & Johnson, or by stockholders duly exercising
appraisal rights as provided by Delaware law) will be converted into the right
to receive in cash the price paid per share pursuant to the tender offer.

INNOTECH'S BOARD OF DIRECTORS HAS UNANIMOUSLY (I) DETERMINED THAT THE
TENDER OFFER AND THE MERGER ARE FAIR TO, AND IN THE BEST INTERESTS OF,
INNOTECH'S STOCKHOLDERS, (II) APPROVED THE MERGER AGREEMENT AND THE TRANSACTIONS
CONTEMPLATED THEREBY, INCLUDING THE TENDER OFFER AND THE MERGER, AND (III)
RECOMMENDED THAT YOU ACCEPT THE TENDER OFFER AND TENDER YOUR SHARES IN THE
TENDER OFFER.

In arriving at its recommendation, Innotech's Board of Directors gave
careful consideration to various factors described in Innotech's
Solicitation/Recommendation Statement on Schedule 14D-9 which is enclosed
herewith. Those factors included the opinion, dated February 10, 1997, of
Innotech's financial advisor, Prudential Securities Incorporated, to the effect
that, as of such date and based upon and subject to the matters set forth
therein, the cash consideration to be received by holders of shares of
Innotech's Common Stock in the tender offer and the merger is fair from a
financial point of view to such holders. The Schedule 14D-9 includes additional
information with respect to the tender offer and the merger and an Information
Statement containing certain information regarding the executive officers and
directors of Innotech as well as the director designees of INO Acquisition
Corp., who are expected to constitute a majority of the Board of Directors of
Innotech upon the purchase by INO Acquisition Corp. pursuant to the tender offer
of such number of shares of Innotech Common Stock which, when added to the
shares beneficially owned by Johnson & Johnson, INO Acquisition Corp. or any
affiliate thereof, represents a majority of Innotech's shares on a fully diluted
basis.

Also enclosed herewith is INO Acquisition Corp.'s Offer to Purchase and
related materials, including a Letter of Transmittal, which set forth the terms
and conditions of the tender offer and provide instructions on how to tender
your shares. We urge you to read the enclosed materials carefully in making your
decision with respect to tendering your shares.

The Board of Directors and management of Innotech thank you for the support
and encouragement you have given Innotech.

Ronald D. Blum
Chairman of the Board

[INNOTECH LETTERHEAD ADDRESS]

<PAGE> 1

EXHIBIT F

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

AGREEMENT dated as of September 19, 1996, between Innotech, Inc., a
corporation organized under the laws of the State of Delaware ("Employer"), and
Robert P. Padula ("Executive").

R E C I T A L S :

WHEREAS, Executive desires to provide services to Employer and Employer
desires to retain the services of Executive;

WHEREAS, Employer and Executive entered into an employment agreement dated
as of March 18, 1994 (the "March Agreement"), which was subsequently amended on
October 2, 1995, December 1, 1995 and April 1, 1996 (the "collectively,
Amendments"); and

WHEREAS, Employer and Executive desire to amend and restate the March
Agreement and the Amendments and to further modify the terms and conditions of
Executive's employment with Employer.

ACCORDINGLY, Employer and Executive hereby agree:

1. Employment.

1.1. General. Employer hereby employs Executive in the capacity of
Vice President of Sales and Customer Care. Executive hereby accepts such
employment, upon the terms and subject to the conditions herein contained.

1.2. Duties. During Executive's employment with Employer, Executive
shall report directly to the President and shall be responsible for
performing those duties consistent with the position of executive vice
president of sales and marketing, including all national and domestic
sales, and international sales, managing the Customer Care Department, and
performing such other duties as may from time to time be assigned to or
requested of Executive by Employer's President and/or Board of Directors
(the "Board"). Executive shall use his reasonable efforts to perform
faithfully and effectively such responsibilities. Executive shall conduct
all of his activities in a manner so as to maintain and promote the
business and reputation of Employer.

1.3. Full-Time Position. Executive, during his employment with
Employer, shall devote all of his business time, attention and skills to
the business and affairs of Employer.

1.4. Location of Employment. Executive's place of employment during
his employment with Employer shall be in Roanoke, Virginia or at any
location as Employer may from time to time move its principal offices.
Notwithstanding anything to the contrary herein, in the event Employer
requires Executive to relocate to a location outside of the metropolitan
Roanoke area and Executive fails to so relocate, such failure shall not be
grounds for termination by Employer for "Cause" (as hereinafter defined).

2. Compensation and Benefits.

2.1. Salary. Effective September 19, 1996, Employer shall pay to
Executive, and Executive shall accept, as full compensation for any and all
services rendered and to be rendered by him to Employer in all capacities
during the term of his employment, (i) a base salary at the annual rate of
$145,000, or at such increased rate as the Board, in its sole discretion,
may hereafter from time to time grant to Executive ("Base Salary"), payable
in accordance with the regular payroll practices of Employer, and (ii) the
additional benefits hereinafter set forth in this Section 2.

2.2. Bonus.

2.2.1. 1996. Employer shall pay to Executive, as additional
compensation, a lump-sum bonus of $30,000 if the total sales of
Employer's fourth quarter of fiscal year 1996 as determined in
<PAGE> 2

accordance with generally accepted accounting principles and as set
forth on Employer's financial statements (without any further
adjustments) equals or exceeds $3,200,000.

2.2.2. MICP. Executive shall be entitled to participate in
Employer's Management Incentive Compensation Plan (the "MICP") and shall
be entitled to awards granted pursuant to the terms thereof as
determined by the Board.

2.3. Executive Benefits.

2.3.1. Expenses. Employer shall reimburse Executive for expenses
he reasonably incurs in connection with the performance of his duties
(including business travel and entertainment expenses), all in
accordance with Employer's policy with respect thereto.

2.3.2. Employer Plans. Executive shall be entitled to participate
in such executive benefit plans and programs as Employer may from time
to time offer or provide to executive officers of Employer, including,
but not limited to, participation in life insurance, health and accident
and medical plans and programs.

2.3.3. Vacation. Executive shall be entitled to two weeks paid
vacation for each twelve month period Executive is employed by Employer.
Such vacation time shall be at such times as shall be approved by the
President or Employer. Vacation, if not taken by Executive in any twelve
month period, shall not carry over to any subsequent period or periods
unless otherwise permitted by the policies of Employer.

3. Stock Option. [Intentionally omitted.]

4. Termination of Employment.

4.1. Termination. Executive's employment by Employer pursuant to this
Agreement shall commence on the date of this agreement and shall continue
until November 30, 1997. Thereafter, it shall continue for successive
one-year periods commencing on December 1 of each subsequent year;
provided, however, that either party may elect to terminate this Agreement
as of November 30, 1997, or as of any subsequent November 30 (a "Renewal
Termination Date"), by written notice to such effect delivered by the other
party at least 60 days prior to such Renewal Termination Date. The election
of Employer or Executive to terminate this Agreement as of November 30,
1997, or as of any Renewal Termination Date, as provided in this Section
4.1 shall not be deemed to be termination by Employer under Sections 4.2.3,
4.2.4 or 4.2.5 hereof or by Executive under Section 4.2.6 hereof, and in
such event, Executive shall only be entitled to Base Salary through the
Renewal Termination Date and that portions of any other benefits accrued
and earned by Executive through the Renewal Termination Date. Upon
termination of Executive's employment with Employer pursuant to Sections
4.2.2 through 4.2.6 hereof, inclusive, Executive shall be released from any
duties and obligations hereunder (except those duties and obligations set
forth in Sections 5, 6.11, 6.12 and 6.13 hereof) and the obligations of
Employer to Executive shall be as set forth in Section 4.3 hereof.

4.2. Events of Termination. Executive's employment with Employer
shall terminate upon the occurrence of any one or more of the following
events:

4.2.1. Death. In the event of Executive's death, Executive's
employment shall terminate on the date of death.

4.2.2. Disability. In the event of Executive's Disability (as
hereinafter defined), Employer shall have the option to terminate
Executive's employment by giving a Notice of Termination to Executive.
The Notice of Termination shall specify the date of termination, which
date shall not be earlier than thirty days after the Notice of
Termination is given. For purposes of this Agreement, "Disability" means
the inability of Executive to substantially perform his duties hereunder
for ninety days out of 180 consecutive days as a result of a physical or
mental illness all as determined in good faith by the Board.
<PAGE> 3

4.2.3. Termination by Employer for Cause. Employer may, at its
option, terminate Executive's employment for "Cause" based on objective
factors determined in good faith by a majority of the Board by giving a
Notice of Termination to Executive specifying the reasons for
termination and if Executive shall fail to cure same within ten days of
his receiving the Notice of Termination his Employment shall terminate
at the end of such ten day period; provided, that in the event the Board
in good faith determines that the underlying reasons giving rise to such
determination cannot be cured, then said cure period shall not apply and
Executive's employment shall terminate on the date of Executive's
receipt of the Notice of Termination. "Cause" shall mean (i) Executive's
conviction of, guilty plea to, or confession of guilt of, a felony, (ii)
dishonest or illegal conduct or misconduct or malfeasance by Executive
in the performance of services for or on behalf of Employer, or other
conduct detrimental to the business, operations or reputation of
Employer, regardless of whether such conduct is within the scope of
Executive's duties, (iii) failure by Executive to perform his duties, as
assigned to him by the President from time to time, (iv) violation by
Executive of the covenants set forth in this Agreement, (v) Executive's
filing of a petition in bankruptcy or filing of a petition to take
advantage of any insolvency act or the filing of any such petition
against Executive, and (vi) except as may be permitted herein,
disclosure of Confidential Information (as defined in Section 5.1
hereof) without the prior written consent of Employer.

4.2.4. Without Cause By Employer. Employer may, at its option,
terminate Executive's employment for any reason whatsoever (other than
for the reasons set forth above in this Section 4.2) by giving a Notice
of Termination to Executive, and Executive's employment shall terminate
on the later of the date the Notice of Termination is given or the date
set forth in such Notice of Termination.

4.2.5. Employer's Material Breach. Executive may, at his option,
terminate Executive's employment upon Employer's material breach of this
Agreement by giving Employer written notice of such breach (which notice
shall identify the manner in which Employer has materially breached this
Agreement) and if such breach is not cured within thirty days of
Employer receiving such written notice, Executive's employment shall
terminate at the end of such thirty day period. Employer's Material
Breach of this Agreement shall mean (i) the failure of Employer to pay
Base Salary or other earned and unpaid bonus hereunder in accordance
with this Agreement or (ii) the assignment to Executive, without
Executive's consent, of duties substantially inconsistent with his
duties as set forth in Section 1.2 hereof.

4.2.6. Without Cause by Executive. Executive may terminate
Executive's employment for any reason whatsoever by giving a Notice of
Termination to Employer. Executive's employment shall terminate on the
earlier of (i) the date, following the date of the Notice of
Termination, upon which a suitable replacement for Executive is found by
Employer, or (ii) five days after the date of receipt by Employer of the
Notice of Termination.

4.3. Certain Obligations of Employer Following Termination of
Executive's Employment. Following the termination of Executive's
employment under the circumstances described below, Employer shall pay to
Executive in accordance with its regular payroll practices the following
compensation and provide the following benefits in full satisfaction and
final settlement of any and all claims and demands that Executive now has
or hereafter may have hereunder against Employer:

4.3.1. Death; Disability. In the event that Executive's employment
is terminated by reason of Executive's death or for Disability,
Executive or his estate, as the case may be, shall be entitled to the
following payments:

(i) Base Salary through the date Executive's employment is
terminated; and

of such plans, policies and practices, in each case, as accrued to
the date of termination or otherwise payable as a consequence of
Executive's death or Disability.

4.3.2. Without Cause by Employer; Material Breach By Employer. In
the event that Executive's employment is terminated by Employer pursuant
to Section 4.2.4 or by Executive pursuant to Section 4.2.5, Executive
shall be entitled to the following payments:

(i) Base Salary through the date Executive's employment is
terminated;

(ii) a pro-rata portion of any amounts Executive would be
entitled to under the MICP, if any, accrued on or prior to date
Executive's employment is terminated for any reason hereunder; and

(iii) continuing payments of Base Salary, payable in accordance
with the regular payroll practices of Employer, for twelve months
following the date of termination of Executive's employment.

4.3.3. Termination by Executive Without Cause or by Employer for
Cause. In the event Executive's employment as terminated by Executive
pursuant to 4.2.6 or by Employer pursuant to Section 4.2.3, Executive
shall be entitled to no further compensation or other benefits under
this Agreement, except as to that portion of any unpaid Base Salary and
other benefits earned by him hereunder but not yet paid up to and
including the effective date of such termination. Executive shall not be
entitled to receive any additional compensation pursuant to the MICP,
except that Executive shall be entitled to receive any amounts earned
but not yet paid under the MICP in respect of any fiscal year prior to
the year of termination and other benefits, if any, in accordance with
other applicable plans and policies of Employer.

4.4. Nature of Payments. All amounts to be paid by Employer to
Executive pursuant to this Section 4 are considered by the parties to be
severance payments. In the event such payments are treated as damages, it
is expressly acknowledged by the parties that damages to Executive for
termination of employment would be difficult to ascertain and the above
amounts are reasonable estimates thereof.

5. Confidentiality; Nonsolicitation; NonCompete.

5.1. Confidential Information Defined. "Confidential Information"
means any and all information (oral or written) relating to Employer or any
person controlling, controlled by, or under common control with Employer or
any of their respective activities, including, but not limited to,
information relating to: discoveries, innovations, chemistry, patents,
patent applications, know how, secret processes, research, test procedures
and results, machinery and equipment; manufacturing processes; financial
information; products; identity and description of materials and services
used; purchasing; costs; pricing; customers and prospects; advertising,
promotion and marketing; trademarks and trademark registrations; copyrights
and copyright registrations; and information pertaining to any governmental
investigation, except such information which can be shown by Executive to
be generally in the public domain (such information not being deemed to be
in the public domain merely because it is embraced by more general
information which is in the public domain), other than as a result of a
breach of the provisions of Section 5.2 hereof.

5.2. Nondisclosure of Confidential Information. Executive shall not,
at any time (other than as may be required or appropriate in connection
with the performance by him of his duties hereunder) directly or
indirectly, use, communicate, disclose or disseminate any Confidential
Information in any manner whatsoever (except as may be required under legal
process by subpoena or other court order).

5.3. Certain Activities. Executive shall not while employed by
Employer and thereafter, directly or indirectly, hire, offer to hire,
entice away or in any other manner persuade or attempt to persuade any
officer, employee, agent, lessor, lessee, licensor, licensee, customer,
prospective customer or supplier of Employer to discontinue or alter his or
its relationship with Employer.

5.4. Covenant Not to Compete. During Executive's employment and for a
period of one year after the termination of Executive's employment,
Executive shall not directly or indirectly engage in
<PAGE> 5

competition with Employer by being associated with any competitor of
Employer that sells or offers to sell any products or services which
compete with the products or services offered or sold by Employer or being
developed by Employer for sale at the time termination of employment would
be difficult to ascertain and the above amounts are reasonable estimates
thereof.

6. Miscellaneous Provisions.

6.1. Severability. If in any jurisdiction any term or provision
hereof is determined to be invalid or unenforceable, (a) the remaining
terms and provisions hereof shall be unimpaired, (b) any such invalidity or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction, and (c) the invalid
or unenforceable term or provision shall, for purposes of such
jurisdiction, be deemed replaced by a term or provision that is valid and
enforceable and that comes closest to expressing the intention of the
invalid or unenforceable term or provision.

6.2. Execution in Counterparts. This Agreement may be executed in one
or more counterparts, each of which shall be deemed to be an original but
all of which taken together shall constitute one and the same agreement
(and all signatures need not appear on any one counterpart), and this
Agreement shall become effective when one or more counterparts has been
signed by each of the parties hereto and delivered to each of the other
parties hereto.

6.3. Notices. All notices, requests, demands and other communications
hereunder shall be in writing and shall be deemed duly given when delivered
by hand, or when delivered if mailed by registered or certified mail or
private courier service, postage prepaid, return receipt requested or via
facsimile (with confirmed answerback) as follows:

If to Employer, to:
Innotech, Inc.
5568 Airport Road
Roanoke, VA 24012
Attention: President
Telecopy No.: (540) 366-5177

Copy to:
Joel D. Zychick, Esq.
c/o Hertzog, Calamari & Gleason
100 Park Avenue
New York, NY 10017
Telecopy No.: (212) 213-1199

If to Executive, to:
Robert P. Padula
161 Twenty-Seventh Street
Roanoke, VA 24014

or to such other address(es) as a party hereto shall have designated by
like notice to the other parties hereto.

6.4. Amendment. No provision of this Agreement may be modified,
amended, waived or discharged in any manner except by a written instrument
executed by Employer and Executive.

6.5. Entire Agreement. This Agreement, as of the date hereof,
constitutes the entire agreement of the parties hereto with respect to the
subject matter hereof, and supersedes all prior agreements and
understandings of the parties hereto, oral or written, with respect to the
subject matter hereof.

6.6. Applicable Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware applicable
to contracts made and to be wholly performed therein without regard to its
conflicts or choice of law provisions.
<PAGE> 6

6.7. Headings. The headings contained herein are for the sole purpose
of convenience of reference, and shall not in any way limit or affect the
meaning or interpretation of any of the terms or provisions of this
Agreement.

6.8. Binding Effect; Successors and Assigns. Executive may not
delegate his duties or assign his rights hereunder. This Agreement shall
inure to the benefit of, and be binding upon, the parties hereto and their
respective heirs, legal representatives, successors and permitted assigns.

6.9. Waiver. etc. The failure of either of the parties hereto to at
any time enforce any of the provisions of this Agreement shall not be
deemed or construed to be a waiver of any such provision, nor to in any way
affect the validity of this Agreement or any provision hereof or the right
of either of the parties hereto to thereafter enforce each and every
provision of this Agreement. No waiver of any breach of any of the
provisions of this Agreement shall be effective unless set forth in a
written instrument executed by the party against whom or which enforcement
of such waiver is sought, and no waiver of any such breach shall be
construed or deemed to be a waiver of any other or subsequent breach.

6.10. Capacity, etc. Executive and Employer hereby represent and
warrant to the other that: (a) he or it has full power, authority and
capacity to execute and deliver this Agreement, and to perform his or its
obligations hereunder; (b) such execution, delivery and performance shall
not (and with the giving of notice or lapse of time or both would not)
result in the breach of any agreements or other obligations to which he or
it is a party or he or it is otherwise bound; and (c) this Agreement is his
or its valid and binding obligation in accordance with its terms.

6.11. Enforcement. If any party institutes legal action to enforce or
interpret the terms and conditions of this Agreement, the prevailing party
shall be awarded reasonable attorneys' fees at all trial and appellate
levels, and the expenses and costs incurred by such prevailing party in
connection therewith. Venue for any such action shall exclusively be
Roanoke, Virginia.

6.12. Arbitration.

(i) Any dispute under Section 4 of this Agreement, including but
not limited to the determination by the Board of a termination for Cause
pursuant to Section 4.2.3 hereof or in respect of the breach thereof
shall be settled by arbitration in Roanoke, Virginia. The arbitration
shall be accomplished in the following manner. Either party may serve
upon the other party written demand that the dispute, specifying the
nature thereof, shall be submitted to arbitration. Within 10 days after
the service of such demand, each of the parties shall designate an
arbitrator and serve written notice of such appointment upon the other
party. If either party fails within the specified time to appoint such
arbitrator, the other party shall be entitled to appoint both
arbitrators. The two arbitrators so appointed shall appoint a third
arbitrator.

(ii) The decision of the arbitrators shall be final and binding
upon the parties. The arbitration shall be conducted, to the extent
consistent with this Section 6.12, in accordance with the then
prevailing rules of commercial arbitration of the American Arbitration
Association or its successor.

6.13. Continuing Effect. Where the context of this Agreement
requires, the respective rights and obligations of the parties shall
survive any termination or expiration of the term of this Agreement.
<PAGE> 7

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

INNOTECH, INC.

By: /s/ STEVEN A. BENNINGTON

------------------------------------
Name: Steven A. Bennington
Title: President

/s/ ROBERT P. PADULA

--------------------------------------
Robert R. Padula

<PAGE> 1

EXHIBIT G

INNOTECH, INC.
5568 AIRPORT ROAD
ROANOKE, VIRGINIA 24012

October 16, 1996

Horace N. Hudson
709 Debra Lane
Roanoke, Virginia 24153

Dear Mr. Hudson:

This letter will confirm our agreement to amend your Employment Agreement
dated as of August 23, 1995 (the "Agreement") as follows:

Section 2.1. of the Agreement is hereby modified to increase your Base
Salary (as defined in the Agreement) to $125,000 effective October 2, 1996.

Except as hereby modified, the Agreement remains in full force and effect.

Please acknowledge your agreement with the foregoing by signing the
enclosed copy of this letter in the space provided below and returning it to us.

Very truly yours,

INNOTECH, INC.

By: /s/ RONALD D. BLUM

------------------------------------
Ronald D. Blum, O.D.
Chairman and Chief
Executive Officer

AGREED TO AND ACCEPTED

/s/ HORACE N. HUDSON
- --------------------------------------
Horace N. Hudson

<PAGE> 1

EXHIBIT H

INNOTECH, INC.
5568 AIRPORT ROAD
ROANOAK, VIRGINIA 24012

October 16, 1996

Dr. Amitava Gupta
25 Summit Way
Roanoke, Virginia 24014

Dear Dr. Gupta:

This letter will confirm our agreement to amend your Amended and Restated
Employment Agreement dated September 15, 1993, as modified by letter agreements
between you and us dated November 3, 1993, December 20, 1994, August 23, 1995
and October 3, 1995 (collectively, the "Agreement") as follows:

Section 2.1. of the Agreement is hereby modified to increase your Base
Salary (as defined in the Agreement) to $205,000 effective August 14, 1996.

Except as hereby modified, the Agreement remains in full force and effect.

Please acknowledge your agreement with the foregoing by signing the
enclosed copy of this letter in the space provided below and returning it to us.

Very truly yours,

INNOTECH, INC.

By: /s/ RONALD D. BLUM
------------------------------------
Ronald D. Blum, O.D.
Chairman and Chief
Executive Officer

AGREED TO AND ACCEPTED

/s/ AMITAVA GUPTA
- --------------------------------------
Amitava Gupta

<PAGE> 1

EXHIBIT I

INNOTECH, INC.
5568 AIRPORT ROAD
ROANOKE, VIRGINIA 24012

October 16, 1996

Dr. Ronald D. Blum
5320 Silver Fox Road
Roanoke, Virginia 24014

Dear Dr. Blum:

This letter will confirm our agreement to amend your Employment Agreement,
dated as of March 2, 1994, as modified by letter agreements between you and us
dated February 23, 1995, August 23, 1995 and October 2, 1995 (collectively, the
"Agreement"), as follows:

Section 2.1 of the Agreement is hereby modified to increase your Base
Salary (as defined in the Agreement) to $190,000 effective August 14, 1996.

Section 3.3.2(i) of the Agreement is hereby amended in its entirety as
follows:

(i) pay executive, in a lump sum, $190,000, with such amount to be
paid within sixty (60) days of the termination of the Employment Period;

Except as hereby modified, the Agreement remains in full force and effect.

Please acknowledge your agreement with the foregoing by signing the
enclosed copy of this letter in the space provided and returning it to us.

Very truly yours,

INNOTECH, INC.

By: /s/ STEVEN A. BENNINGTON

------------------------------------
Steven A. Bennington
President

AGREED TO AND ACCEPTED

/s/ DR. RONALD D. BLUM
- ---------------------------------------------
Dr. Ronald D. Blum

<PAGE> 1

EXHIBIT J

THIRD AMENDED AND RESTATED
EMPLOYMENT AGREEMENT

AGREEMENT dated as of October 16, 1996, between Innotech, Inc., a
corporation organized under the laws of the State of Delaware ("Employer"), and
Steven A. Bennington ("Executive").

R E C I T A L S:

WHEREAS, Employer and Executive entered into an Employment Agreement dated
July 1, 1992 (the "July Agreement");

WHEREAS, the July Agreement was amended and restated by the Amended and
Restated Employment Agreement dated as of December 15, 1992 (the "December
Agreement");

WHEREAS, the December Agreement was amended and restated by the Second
Amended and Restated Employment Agreement dated as of October 2, 1995 (the
"October Agreement");

WHEREAS, Employer and Executive desire to amend the October Agreement to
further modify the terms of Executive's employment by Employer; and

WHEREAS, Executive desires to continue employment with Employer and
Employer desires to continue to retain the services of Executive on the terms
and conditions hereafter set forth.

NOW, THEREFORE, in consideration of the premises and of the mutual
covenants set forth herein and for other good and valuable consideration,
Employer and Executive hereby agree that this Third Amended and Restated
Employment Agreement (the "Agreement") amends, restates and is in complete
substitution of the October Agreement and further agree as follows:

1. Employment.

1.1. General. Employer hereby employs Executive in the capacity of
President and Chief Operating Officer. Executive hereby accepts such
employment, upon the terms and subject to the conditions herein contained.

1.2. Duties. During the Employment Period (as defined in Section 3.1
hereof), Executive will be responsible for the day-to-day operations of
Employer, including but not limited to financial, sales and marketing and
manufacturing, and performing such other duties as may from time to time be
assigned to or requested of Executive by Employer's Chairman of the Board
of Directors (the "Chairman"), and/or Board of Directors (the "Board").
Executive shall use his reasonable efforts to perform faithfully and
effectively such responsibilities. Executive shall conduct all of his
activities in a manner so as to maintain and promote the business and
reputation of Employer.

1.3. Full-Time Position. Executive, during the Employment Period,
will devote all of his business time, attention and skills to the business
and affairs of Employer.

1.4. Location of Employment. Executive's place of employment during
the Employment Period shall be in Roanoke, Virginia or at any location as
Employer may from time to time move its principal offices. Notwithstanding
anything to the contrary herein, in the event Employer requires Executive
to relocate to a location outside of the metropolitan Roanoke area and
Executive fails to so relocate, such failure shall not be grounds for
termination by Employer for Cause (as defined in Section 3.2.3 hereof).

2. Compensation and Benefits.

2.1. Salary. Effective August 14, 1996, Employer will pay to
Executive, and Executive will accept, as full compensation for any and all
services rendered and to be rendered by him during the Employment Period to
Employer in all capacities, (i) a base salary at the annual rate of
$175,000, or at such increased rate as the Board, in its sole discretion,
may hereafter from time to time grant to Executive ("Base
<PAGE> 2

Salary"), payable in accordance with the regular payroll practices of
Employer, and (ii) the additional benefits hereinafter set forth in this
Section 2.

2.2. Additional Compensation. Executive shall be entitled to
participate in Employer's Management Incentive Compensation Plan (the
"MICP") and shall be entitled to awards granted pursuant to the terms
thereof as determined by the Board. Executive, at his election, shall be
entitled to an advance of up to $7,500 against the MICP for 1996 (the "MICP
Advance"), provided, that, Executive shall repay, without interest, the
difference between the amount of any MICP Advance and the actual bonus
earned under the MICP for 1996 in the event that the MICP Advance shall
exceed the actual bonus earned. Executive's target award for MICP plan
years 1997 and 1998 shall be not less than 40% of Executive's then Base
Salary for the applicable plan year.

2.3. Executive Benefits.

2.3.1. Expenses. Employer will reimburse Executive for expenses he
reasonably incurs in connection with the performance of his duties
(including business travel and entertainment expenses), all in accordance
with Employer's policies with respect thereto.

2.3.2. Employer Plans. Executive will be entitled to participate in
such employee benefit plans and programs as Employer may from time to time
offer or provide to executive officers of Employer, including, but not
limited to, participation in life insurance, health and accident and
medical plans and programs.

2.3.3. Life Insurance. During the Employment Period, Employer shall
pay all premiums on a term life insurance policy on the life of Executive
having a face value of $1,000,000, and Executive shall be entitled to name
the beneficiaries of such policy; provided, that, in lieu of the foregoing,
Executive may elect to have Employer pay all premiums on a disability
policy with respect to Executive in an amount not greater than the premiums
Employer would have paid on such life insurance policy.

2.3.4. Vacation. During the Employment Period, Executive shall be
entitled to two weeks vacation for each twelve (12) month period Executive
is employed by Employer, as shall be approved by the Chairman. Executive
shall be able to accrue vacation days from year to year in accordance with
Employer's published policies.

2.3.5. Outplacement. Upon termination of the Employment Period,
Employer shall provide and pay for such outplacement services for Executive
as Executive shall select. Employer shall not be required to pay in excess
of $5,000 for such outplacement services.

3. Employment Period; Termination.

3.1. Employment Period. For purposes of this Agreement, Executive's
employment by Employer commenced on August 14, 1996 and will continue until
August 13, 1998 (the "Initial Period"). Thereafter, it will continue for
successive one-year periods commencing August 14 of each subsequent year
following the Initial Period (the Initial Period together with any
subsequent employment period being referred to herein as the "Employment
Period"); provided, however, that either party may elect to terminate this
Employment Agreement as of August 13, 1998, or as of any subsequent August
13 (a "Renewal Termination Date"), by written notice to such effect
delivered by the other party at least 90 days prior to such Renewal
Termination Date. The election of Employer or Executive to terminate this
Agreement as of August 13, 1998, or as of any Renewal Termination Date, as
provided in this Section 3.1 shall not be deemed to be termination by
Employer under Sections 3.2.3, 3.2.4 or 3.2.5 hereof or by Executive under
Section 3.2.6 hereof, and in such event, Executive shall only be entitled
to Base Salary through the Renewal Termination Date and a pro-rata portion
of any amounts Executive would be entitled to under the MICP.
<PAGE> 3

3.2. Events of Termination. The Employment Period will terminate upon
the occurrence of any one or more of the following events:

3.2.1. Death. In the event of Executive's death, the Employment
Period will terminate on the date of death.

3.2.2. Disability. In the event of Executive's Disability (as
hereinafter defined), Employer will have the option to terminate the
Employment Period by giving a Notice of Termination to Executive. The
Notice of Termination shall specify the date of termination, which date
shall not be earlier than thirty (30) days after the Notice of
Termination is given. For purposes of this Employment Agreement,
"Disability" means the inability of Executive to substantially perform
his duties hereunder for 90 days out of 180 consecutive days as a result
of a physical or mental illness, all as determined in good faith by the
Board.

3.2.3. Termination by Employer for Cause. Employer may, at its
option, terminate the Employment Period for "Cause" based on objective
factors determined in good faith by a majority of the Board as set forth
in a Notice of Termination to Executive specifying the reasons for
termination and the failure of Executive to cure same within ten (10)
days of his receiving the Notice of Termination; provided, that in the
event the Board in good faith determines that the underlying reasons
giving rise to such determination cannot be cured, then said cure period
shall not apply, and the Employment Period shall terminate on the date
of Executive's receipt of the Notice of Termination (the "Termination
Date"). "Cause" shall mean (i) Executive's conviction of, guilty plea
to, or confession of guilt of, a felony, (ii) disloyal, dishonest or
illegal conduct or intentional misconduct or malfeasance by Executive in
the performance of services for or on behalf of Employer, or other
conduct materially detrimental to the business, operations or reputation
of Employer, regardless of whether such conduct is within the scope of
Executive's duties, (iii) failure by Executive to substantially perform
his duties, as assigned to him by the Chairman, President or the Board
from time to time, (iv) violation by Executive of the covenants set
forth in this Agreement, (v) the filing by or against Executive of any
bankruptcy, insolvency or reorganization proceeding, (vi) except as may
be permitted herein, disclosure of Confidential Information (as
hereinafter defined) without the prior written consent of Employer, or
(vii) failure to assign to Employer Inventions (as hereinafter defined)
as may be required herein.

3.2.4. Without Cause By Employer. Employer may, at its option,
terminate the Employment Period for any reason whatsoever (other than
for the reasons set forth above in this Section 3.2) by giving a Notice
of Termination to Executive, and the Termination Date shall be the later
of the date the Notice of Termination is given or the date set forth in
such Notice of Termination.

3.2.5. Employer's Material Breach. Executive may, at his option,
terminate the Employment Period upon Employer's material breach of this
Employment Agreement and the continuation of such breach for more than
thirty (30) days after written demand for cure of said breach is given
to Employer by Executive (which demand will identify the manner in which
Employer has materially breached this Employment Agreement). In the
event of a termination under this Section 3.2.5, the Termination Date
shall mean the 31st day after written demand for cure is given by
Executive to Employer. Employer's "Material Breach" of this Employment
Agreement shall mean (i) the failure of Employer to pay Base Salary or
additional compensation hereunder in accordance with this Agreement or
(ii) the assignment to Executive without Executive's consent of duties
substantially inconsistent with his duties as set forth in Section 1.2
hereof.

3.2.6. Without Cause By Executive. Executive may terminate the
Employment Period for any reason whatsoever by giving a Notice of
Termination to Employer. The Termination Date pursuant to this Section
3.2.6 shall be the earlier of (i) the date, following the date of the
Notice of Termination, upon which a suitable replacement for Executive
is found by Employer, or (ii) 60 days after the date of receipt by
Employer of the Notice of Termination.
<PAGE> 4

3.3. Certain Obligations of Employer Following Termination of the
Employment Period. Following termination of the Employment Period under
the circumstances described below, Employer will pay to Executive in
accordance with its regular payroll practices the following compensation
and provide the following benefits in full satisfaction and final
settlement of any and all claims and demands that Executive now has or
hereafter may have hereunder against Employer:

3.3.1. Death; Disability. In the event that the Employment Period
is terminated by reason of Executive's death or for Disability,
Executive or his estate, as the case may be, shall be entitled to the
following payments:

(i) Base Salary through the date of death or the date of
termination as specified in the Notice of Termination in the event of
Disability;

(ii) A pro-rata portion of any amounts Executive would be
entitled to under the MICP, if any, accrued on or prior to the date
of death or the date of termination as specified in the Notice of
Termination in the event of Disability; and

(iii) Employer shall pay to Executive or his estate, as the case
may be, the amounts and shall provide all benefits generally
available under the employee benefit plans, and the policies and
practices of Employer, determined in accordance with the applicable
terms and provisions of such plans, policies and practices, in each
case, as accrued to the date of termination as specified in the
Notice of Termination in the event of Disability or otherwise payable
as a consequence of Executive's death or Disability.

3.3.2. Without Cause by Employer; Material Breach by Employer. In
the event that the Employment Period is terminated by Employer pursuant
to Section 3.2.4 hereof or by Executive pursuant to Section 3.2.5
hereof, Executive shall be entitled to the following payments:

(i) Base Salary through the Termination Date;

(ii) a pro-rata portion of any amounts Executive would be
entitled to under the MICP, if any, accrued on or prior to the
Termination Date; and

(iii) continuing payments of Base Salary, payable in accordance
with regular payroll practices of Employer, for the greater of: [X]
twelve (12) months or [Y] the remaining portion of the Employment
Period, as it may be extended as provided in Section 3.1 hereof.

3.3.3. Termination by Executive Without Cause or by Employer for
Cause. In the event the Employment Period as terminated by Executive
pursuant to 3.2.6 hereof or by Employer pursuant to Section 3.2.3
hereof, Executive shall be entitled to no further compensation or other
benefits under this Agreement except as to that portion of any unpaid
Base Salary and other benefits accrued and earned by him hereunder up to
and including the effective date of such termination. Executive shall
not be entitled to receive any additional compensation pursuant to the
MICP, except that Executive shall be entitled to receive any amounts
earned but not yet paid under the MICP in respect of any fiscal year
prior to the year of termination and other benefits, if any, in
accordance with other applicable plans and policies of Employer.

3.4. Nature of Payments. All amounts to be paid by Employer to
Executive pursuant to Section 3.3 hereof are considered by the parties to
be severance payments. In the event such payments are treated as damages,
it is expressly acknowledged by the parties that damages to Executive for
termination of employment would be difficult to ascertain and the above
amounts are reasonable estimates thereof. Upon termination of the
Employment Period pursuant to Sections 3.2.2 through 3.2.6 hereof,
inclusive, Executive will be released from any duties and obligations
hereunder (except the duties and obligations set forth in Sections 4, 6.11
and 6.12 hereof) and the obligations of Employer to Executive will be as
set forth in Section 3.3 hereof.
<PAGE> 5

4. Confidentiality; Nonsolicitation; Non-Compete.

4.1. Confidential Information Defined. Confidential Information means
any and all information (oral or written) relating to Employer or any
person controlling, controlled by, or under common control with Employer or
any of their respective activities, including, but not limited to,
information relating to: technology, patents, patent applications, know
how, secret processes, research, test procedures and results, machinery and
equipment; manufacturing processes; financial information; products;
identity and description of materials and services used; purchasing; costs;
pricing; customers and prospects; advertising, promotion and marketing; and
selling, servicing and information pertaining to any governmental
investigation, except such information which can be shown by Executive to
be generally in the public domain (such information not being deemed to be
in the public domain merely because it is embraced by more general
information which is in the public domain), other than as a result of a
breach of the provisions of Section 4.2 hereof.

4.2. Nondisclosure of Confidential Information. Executive will not,
at any time (other than as may be required or appropriate in connection
with the performance by him of his duties hereunder) directly or
indirectly, use, communicate, disclose or disseminate any Confidential
Information in any manner whatsoever (except as may be required under legal
process by subpoena or other court order; provided, that, Executive will
take reasonable steps to give Employer sufficient prior written notice in
order to contest such requirement or order).

4.3. Certain Activities. Executive will not while employed by
Employer and thereafter, directly or indirectly, hire, offer to hire,
entice away or in any other manner persuade or attempt to persuade any
officer, employee, agent, lessor, lessee, licensor, licensee, customer,
prospective customer or supplier of Employer to discontinue or alter his or
its relationship with Employer.

4.4. Covenant Not to Compete. During the Employment Period and for a
period of two years thereafter Executive will not directly or indirectly
engage in competition with Employer by being associated with any competitor
of Employer that sells or offers to sell any products or services which
compete with the products or services offered or sold by Employer or being
developed by Employer for sale; or induce or attempt to induce, directly or
indirectly, any then current or potential customer of Employer to cease
doing business, in whole or in part, with Employer or solicit business of
any such customer for any products or services of any competitor of
Employer which compete with the products or services offered or sold by
Employer or being developed by Employer for sale. Notwithstanding the
foregoing, in the event Executive's employment is terminated by Employer
Without Cause or due to Employer's Material Breach, this Section 4.4 shall
only apply to the products or services offered or sold by Employer that
relate to its SurfaceCasting technology.

4.5. Inventions. Any and all inventions, innovations or improvements
("Inventions") made, developed or created by Executive (whether at the
request of Employer or otherwise, whether alone or in conjunction with
others, and whether during regular hours of work or otherwise) during the
Employment Period which may be useful in, or relate to, the business of
Employer, shall be promptly and fully disclosed by Executive to the Board
and shall be Employer's exclusive property as against Executive. Executive
shall, at the request of Employer, and without any charge to Employer, but
at Employer's sole cost and expense, execute any documents as may be
necessary or advisable to obtain patents or copyrights for said Inventions
and to vest title thereto in Employer.

4.6. Injunctive Relief. The parties hereby acknowledge and agree that
(a) Employer will be irreparably injured in the event of a breach by
Executive of any of his obligations under this Section 4; (b) monetary
damages will not be an adequate remedy for any such breach; (c) Employer
will be entitled to injunctive relief, in addition to any other remedy
which it may have, in the event of any such breach, including, but not
limited to, termination of the Employment Period for Cause; and (d) the
existence of any claims which Executive may have against Employer, whether
under this Agreement or otherwise, will not be a defense to the enforcement
by Employer of any of its rights under this Section 4.
<PAGE> 6

4.7. Nonexclusivity and Survival. The covenants of Executive
contained in this Section 4 are in addition to, and not in lieu of, any
obligations which Executive may have with respect to the subject matter
hereof, whether by contract, as a matter of law or otherwise, and such
covenants and their enforceability will survive any termination of the
Employment Period by either party and any investigation made with respect
to the breach thereof by Employer at any time.

5. Stock Option. Concurrently with the execution and delivery of this
Agreement, Employer and Executive have executed and delivered the stock option
agreements in the form annexed hereto as Exhibit A and Exhibit B.

6. Miscellaneous Provisions.

6.2. Execution in Counterparts. This Agreement may be executed in one
or more counterparts, and by the different parties hereto in separate
counterparts, each of which shall be deemed to be an original but all of
which taken together shall constitute one and the same agreement (and all
signatures need not appear on any one counterpart), and this Agreement
shall become effective when one or more counterparts has been signed by
each of the parties hereto and delivered to each of the other parties
hereto.

6.3. Notices. All notices, requests, demands and other communications
hereunder shall be in writing and shall be deemed duly given when delivered
by hand, or when delivered if mailed by registered or certified mail or
private courier service, postage prepaid, return receipt requested or
via facsimile (with written confirmation of receipt) as follows:

If to Employer, to:

Innotech, Inc.
5568 Airport Road
Roanoke, VA 24012
Attention: Chairman
Telecopy No.: (540) 366-5177

Copy to:

Joel D. Zychick, Esq.
c/o Hertzog, Calamari & Gleason
100 Park Avenue
New York, NY 10017
Telecopy No.: (212) 213-1199

If to Executive, to:

Steven A. Bennington
1574 Strawberry Mountain Drive
Roanoke, VA 24018

or to such other address(es) as a party hereto shall have designated by
like notice to the other parties hereto.

6.4. Amendment. No provision of this Agreement may be modified,
amended, waived or discharged in any manner except by a written instrument
executed by Employer and Executive.
<PAGE> 7

6.5. Entire Agreement. This Agreement constitutes the entire
agreement of the parties hereto with respect to the subject matter hereof,
and supersedes all prior agreements and understandings of the parties
hereto, oral or written, with respect to the subject matter hereof.

6.6. Applicable Law. This Agreement shall be governed by and
construed in accordance with the laws of the Commonwealth of Virginia
applicable to contracts made and to be wholly performed therein without
regard to its conflicts or choice of law provisions.

6.8. Binding Effect; Successors and Assigns. Executive may not
delegate his duties or assign his rights hereunder. This Agreement will
inure to the benefit of, and be binding upon, the parties hereto and their
respective heirs, legal representatives, successors and permitted assigns.

6.9. Waiver, etc. The failure of either of the parties hereto to at
any time enforce any of the provisions of this Agreement shall not be
deemed or construed to be a waiver of any such provision, nor to in any way
affect the validity of this Agreement or any provision hereof or the right
of either of the parties hereto to thereafter enforce each and every
provision of this Agreement. No waiver of any breach of any of the
provisions of this Agreement shall be effective unless set forth in a
written instrument executed by the party against whom or which enforcement
of such waiver is sought, and no waiver of any such breach shall be
construed or deemed to be a waiver of any other or subsequent breach.

6.10. Capacity, etc. Executive and Employer hereby represent and
warrant to the other that: (a) he or it has full power, authority and
capacity to execute and deliver this Agreement, and to perform his or its
obligations hereunder; (b) such execution, delivery and performance will
not (and with the giving of notice or lapse of time or both would not)
result in the breach of any agreements or other obligations to which he or
it is a party or he or it is otherwise bound; and (c) this Agreement is his
or its valid and binding obligation in accordance with its terms.

6.12. Arbitration.

(a) Any dispute under Section 3 hereof, including but not limited
to the determination by the Board of a termination for Cause pursuant to
Section 3.2.3 hereof or in respect of the breach thereof will be settled
by arbitration in Roanoke, Virginia. The arbitration will be
accomplished in the following manner. Either party may serve upon the
other party written demand that the dispute, specifying the nature
thereof, shall be submitted to arbitration. Within ten (10) days after
the service of such demand, each of the parties will designate an
arbitrator and serve written notice of such appointment upon the other
party. If either party fails within the specified time to appoint such
arbitrator, the other party will be entitled to appoint both
arbitrators. The two (2) arbitrators so appointed will appoint a third
arbitrator.

(b) The decision of the arbitrators will be final and binding upon
the parties. The arbitration will be conducted, to the extent consistent
with this Section 6.12, in accordance with the then prevailing rules of
commercial arbitration of the American Arbitration Association or its
successor.
<PAGE> 8

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

INNOTECH, INC.

By: /s/ RONALD D. BLUM
------------------------------------
Ronald D. Blum
Chairman and Chief
Executive Officer

/s/ STEVEN A. BENNINGTON
--------------------------------------
Steven A. Bennington

<PAGE> 1

EXHIBIT K

EMPLOYMENT AGREEMENT, dated as of October 2, 1995, between Innotech, Inc.,
a corporation organized under the laws of the State of Delaware ("Employer"),
and Sunder Malkani ("Executive").

WHEREAS, Executive desires to provide services to Employer and Employer
desires to retain the services of Executive;

WHEREAS, Employer and Executive desire to formalize the terms and
conditions of Executive's employment with Employer.

NOW, THEREFORE, Employer and Executive hereby agree as follows:

1. Employment.

1.1. General. Employer hereby employs Executive in the capacity of
Vice President of Marketing. Executive hereby accepts such employment, upon
the terms and subject to the conditions herein contained.

1.2. Duties. During the Executive's employment with Employer,
Executive will report directly to the Chief Operating Officer, will be
responsible for performing those duties consistent with the position of
vice president of marketing and for performing such other duties as may
from time to time be assigned to or requested of Executive by Employer's
Chief Operating Officer, President or Chairman of the Board and/or the
Board of Directors (the "Board"). Executive shall use his reasonable
efforts to perform faithfully and effectively such responsibilities.
Executive shall conduct all of his activities in a manner so as to maintain
and promote the business and reputation of the Employer.

1.3. Full-Time Position. Executive, during his employment with
Employer, will devote all of his business time, attention and skills to the
business and affairs of Employer.

1.4. Location of Employment. Executive's place of employment during
his employment with Employer shall be in Roanoke, Virginia. Notwithstanding
anything to the contrary in this Agreement, in the event Employer requires
Executive to relocate to a location outside of the metropolitan Roanoke
area and Executive fails to so relocate, such failure shall not be deemed
to be grounds for termination for "Cause" (as defined in Section 3.2.3.
hereof).

1.5. Relocation. Employer will reimburse to Executive relocation
costs associated with his moving from Atlanta, Georgia to Roanoke, Virginia
in an amount not to exceed $10,000. Notwithstanding anything to the
contrary in this Agreement, if Executive has not moved to Roanoke, Virginia
on or before January 1, 1996, this Agreement will terminate, and Executive
shall not be entitled to any payments pursuant to Section 3.3.2 hereof.

2. Compensation and Benefits.

2.1. Salary. Employer will pay to Executive, and Executive will
accept, as full compensation for any and all services rendered and to be
rendered by him to Employer in all capacities during the term of his
employment under this Agreement, (i) a base salary at the annual rate of
$115,000 or at such rate as the Board, in its sole discretion, may
hereafter from time to time grant to Executive ("Base Salary"), payable in
accordance with the regular payroll practices of Employer, and (ii) the
additional benefits hereinafter set forth in this Section 2.

2.2. Additional Compensation. Executive shall be entitled to
participate in the Employer's Management Incentive Compensation Plan
commencing on the date hereof and shall be entitled to any awards granted
pursuant to the terms thereof as determined by the Board.
<PAGE> 2

2.3. Executive Benefits.

2.3.1. Expenses. Employer will reimburse Executive for expenses
he reasonably incurs in connection with the performance of his duties
(including business travel and entertainment expenses), all in
accordance with Employer's policies with respect thereto.

2.3.2. Employer Plans. Executive will be entitled to participate
in such executive benefit plans and programs as Employer may from time
to time offer or provide to executives of Employer, including, but not
limited to, participation in life insurance, health and accident and
medical plans and programs.

2.3.3. Vacation. Executive shall be eligible for paid vacation
leave, accruing one day of leave for each 5.2 weeks of employment, or 10
days of paid leave per year. Executive shall be able to accrue vacation
days from year to year in accordance with Employer's published vacation
policies . Such vacation time shall be at such times as shall be
approved by the Chief Operating Officer, President or Chairman of
Employer.

3. Termination of Employment.

3.1. Termination. Executive's employment by Employer pursuant to
this Agreement shall commence on the date hereof and will continue until
the second anniversary of the date of this Agreement. Thereafter, each
party will have the option of continuing this Agreement on such terms and
conditions as they may mutually agree. Upon termination of Executive's
employment with Employer pursuant to Sections 3.2.2 through 3.2.6 hereof,
inclusive, Executive will be released from any duties and obligations
hereunder (except those duties and obligations set forth in Sections 4,
5.11,.12 and 5.13 hereof) and the obligations of Employer to Executive will
be as set forth in Section 3.3 hereof.

3.2. Events of Termination. Executive's employment with Employer
will terminate upon the occurrence of any one or more of the following
events:

3.2.1. Death. In the event of the Executive's death, Executive's
employment will terminate on the date of death.

3.2.2. Disability. In the event of Executive's Disability (as
hereinafter defined), Employer will have the option to terminate
Executive's employment by giving a Notice of Termination to Executive.
The Notice of Termination shall specify the date of termination, which
date shall not be earlier than thirty (30) days after the Notice of
Termination is given. For purposes of this Agreement, "Disability" means
the inability of Executive to substantially perform his duties hereunder
for 90 days out of 180 consecutive days as a result of a physical or
mental illness, all as determined in good faith by the Board.

3.2.3. Termination by Employer for Cause. Employer may, at its
option, terminate Executive's employment for "Cause" based on objective
factors determined in good faith by a majority of the Board by giving a
Notice of Termination to Executive specifying the reasons for
termination and if Executive shall fail to cure same within ten (10)
days of his receiving the Notice of Termination his Employment shall
terminate at the end of such ten (10) day period; provided, that in the
event the Board in good faith determines that the underlying reasons
giving rise to such determination cannot be cured, then said cure period
shall not apply and Executive's employment shall terminate on the date
of Executive's receipt of the Notice of Termination. "Cause" shall mean
(i) Executive's conviction of, guilty plea to, or confession of guilt
of, a felony, (ii) dishonest or illegal conduct or misconduct or
malfeasance by Executive in the performance of services for or on behalf
of the Employer, or other conduct detrimental to the business,
operations or reputation of the Employer, regardless of whether such
conduct is within the scope of Executive's duties, (iii) failure by
Executive to perform his duties, as assigned to him by the Chief
Executive Officer, President, Chairman or the Board from time to time,
(iv) violation by Executive of the covenants set forth in this
Agreement, (v) the filing by or against Executive of any bankruptcy,
insolvency or reorganization proceeding, (vi) except as may be permitted
herein, disclosure of Confidential Information (as

2
<PAGE> 3

defined in Section 4.1 hereof) without the prior written consent of
Employer and (vii) Executive's failure to move to Roanoke, Virginia on
or prior to January 1, 1996.

3.2.4. Without Cause By Employer. Employer may, at its option,
terminate the Executive's employment for any reason whatsoever (other
than for the reasons set forth above in this Section 3.2) by giving a
Notice of Termination to Executive, and Executive's employment shall
terminate on the later of the date the Notice of Termination is given or
the date set forth in such Notice of Termination.

3.2.5. Employer's Material Breach. Executive may, at his option,
terminate the Executive's employment upon Employer's material breach of
this Agreement by giving Employer written notice of such breach (which
notice will identify the manner in which Employer has materially
breached this Agreement) and if such breach is not cured within thirty
(30) days of Employer receiving such written notice, the Executive's
employment shall terminate at the end of such thirty (30) day period.
Employer's "Material Breach" of this Agreement shall mean (i) the
failure of Employer to pay Base Salary or additional compensation
hereunder in accordance with this Agreement or (ii) the assignment to
Executive without Executive's consent of duties substantially
inconsistent with his duties as set forth in Section 1.2 hereof.

3.2.6. Without Cause By Executive. Executive may terminate the
Executive's employment for any reason whatsoever by giving a Notice of
Termination to Employer. The Executive's employment shall terminate on
the earlier of (i) the date, following the date of the Notice of
Termination, upon which a suitable replacement for Executive is found by
the Employer, or (ii) 5 days after the date of receipt by Employer of
the Notice of Termination.

3.3. Certain Obligations of Employer Following Termination of the
Executive's Employment. Following the termination of the Executive's
employment under the circumstances described below, Employer will pay to
Executive in accordance with its regular payroll practices the following
compensation and provide the following benefits in full satisfaction and
final settlement of any and all claims and demands that Executive now has
or hereafter may have hereunder against Employer:

3.3.1. Death; Disability. In the event that the Executive's
employment is terminated by reason of Executive's death or Disability,
Executive or his estate, as the case may be, shall be entitled to the
following payments:

(i) Base Salary through the date the Executive's employment is
terminated; and

(ii) Employer shall pay to Executive or his estate, as the case
may be, the amounts and shall provide all benefits generally
available under the employee benefit plans, and the policies and
practices of Employer, determined in accordance with the applicable
terms and provisions of such plans, policies and practices, in each
case, as accrued to the date of termination or otherwise payable as a
consequence of Executive's death or Disability.

3.3.2. Without Cause by Employer; Material Breach by Employer. In
the event that the Executive's employment is terminated by Employer
pursuant to Section 3.2.4 hereof or by Executive pursuant to Section
3.2.5 hereof, Executive shall be entitled to the following payments:

(i) Base Salary through the date the Executive's employment is
terminated; and

(ii) a pro-rata portion of any amounts Executive would be
entitled to under the MICP, if any, accrued on or prior to date
Executive's employment is terminated for any reason hereunder.

(iii) continuing payments of Base Salary, payable in accordance
with the regular payroll practices of Employer, for six (6) months
following the date of termination of Executive's employment.

3.3.3. Termination by Executive Without Cause or by Employer for
Cause. In the event the Executive's employment is terminated by
Executive pursuant to Section 3.2.6 hereof or by Employer

3
<PAGE> 4

pursuant to Section 3.2.3 hereof, Executive shall be entitled to no
further compensation or other benefits under this Agreement except as to
that portion of any unpaid Base Salary and other benefits accrued and
earned by him hereunder up to and including the effective date of such
termination. In addition, Executive shall be entitled to receive any
additional compensation earned but not yet paid with respect only to any
calendar year prior to the calendar year of termination.

3.4. Nature of Payments. All amounts to be paid by Employer to
Executive pursuant to this Section 3 are considered by the parties to be
severance payments. In the event such payments are treated as damages, it
is expressly acknowledged by the parties that damages to Executive for
termination of employment would be difficult to ascertain and the above
amounts are reasonable estimates thereof.

4. Confidentiality; Nonsolicitation; Non-Compete.

4.1. Confidential Information Defined. "Confidential Information"
means any and all information (oral or written) relating to Employer or any
person controlling, controlled by, or under common control with Employer or
any of their respective activities, including, but not limited to,
information relating to: discoveries, innovations, chemistry, patents,
patent applications, know how, secret processes, research, test procedures
and results, machinery and equipment; manufacturing processes; financial
information; products; identity and description of materials and services
used; purchasing; costs; pricing; customers and prospects; advertising,
promotion and marketing; trademarks and trademark registrations; copyrights
and copyright registrations; and information pertaining to any governmental
investigation, except such information which can be shown by Executive to
be generally in the public domain (such information not being deemed to be
in the public domain merely because it is embraced by more general
information which is in the public domain), other than as a result of a
breach of the provisions of Section 4.2 hereof.

4.3. Certain Activities. Executive will not while employed by
Employer and thereafter, directly or indirectly, hire, offer to hire,
entice away or in any other manner persuade or attempt to persuade any
officer, employee, agent, lessor, lessee, licensor, licensee, customer,
prospective customer, supplier or shareholder or prospective shareholder of
Employer to discontinue or alter his or its relationship with Employer.

4.4. Covenant Not to Compete. During the Executive's employment and
for a period of two (2) years after the termination of Executive's
employment, Executive will not directly or indirectly engage in competition
with Employer by being associated with any competitor of Employer that
sells or offers to sell any products or services which compete with the
products or services offered or sold by Employer or being developed by
Employer for sale at the time of termination of the Executive, or induce or
attempt to induce, directly or indirectly, any then current or potential
customer of Employer to cease doing business, in whole or in part, with
Employer or solicit business of any such customer for any products or
services of any competitor of Employer which compete with the products or
services offered or sold by Employer or being developed by Employer for
sale at the time of termination of the Executive. Notwithstanding the
foregoing, in the event Executive's employment is terminated by Employer
without Cause or due to Employer's Material Breach of this Agreement, this
Section 4.4 shall only apply to the products or services offered or sold by
Employer that relate to its SurfaceCasting technology.

4.5. Injunctive Relief. Executive acknowledges and agrees that (a)
Employer will be irreparably injured in the event of a breach by Executive
of any of his obligations under this Section 4; (b) monetary damages will
not be an adequate remedy for any such breach; (c) Employer will be
entitled to injunctive relief, in addition to any other remedy which it may
have, in the event of any such breach, including, but

4
<PAGE> 5

not limited to, termination of the Executive's employment for Cause; and
(d) the existence of any claims which Executive may have against Employer,
whether under this Agreement or otherwise, will not be a defense to the
enforcement by Employer of any of its rights under this Section 4.

4.6. Nonexclusivity and Survival. The covenants and obligations of
Executive contained in this Section 4 are in addition to, and not in lieu
of, any covenants and obligations which Executive may have with respect to
the subject matter hereof, whether by contract, as a matter of law or
otherwise, and such covenants and obligations, and their enforceability,
will survive any termination of the Executive's employment by either party
and any investigation made with respect to the breach thereof by Employer
at any time.

5. Miscellaneous Provisions.

5.1. Severability. If in any jurisdiction any term or provision
hereof is determined to be invalid or unenforceable, (a) the remaining
terms and provisions hereof shall be unimpaired, (b) any such invalidity or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction, and (c) the invalid
or unenforceable term or provision shall, for purposes of such
jurisdiction, be deemed replaced by a term or provision that is valid and
enforceable and that comes closest to expressing the intention of the
invalid or unenforceable term or provision.

5.2. Execution in Counterparts. This Agreement may be executed in
one or more counterparts, and by the different parties hereto in separate
counterparts, each of which shall be deemed to be an original but all of
which taken together shall constitute one and the same agreement (and all
signatures need not appear on any one counterpart), and this Agreement
shall become effective when one or more counterparts has been signed by
each of the parties hereto and delivered to each of the other parties
hereto.

5.3. Notices. All notices, requests, demands and other
communications hereunder shall be in writing and shall be deemed duly given
when delivered by hand, or when delivered if mailed by registered or
certified mail or private courier service, postage prepaid, return receipt
requested or via facsimile (with written confirmation of receipt) as
follows:

If to Employer, to:

InnoTech, Inc.
5568 Airport Road
Roanoke, VA 24012
Attention: Dr. Ronald Blum, Chairman
Telefax No.: (703) 366-5177

Copy to:

Joel D. Zychick, Esq.
c/o Hertzog, Calamari & Gleason
100 Park Avenue
New York, NY 10017
Telefax No.: (212) 213-1199

If to Executive, to:

Mr. Sunder Malkani
120 Sunningdale Court
Duluth, Georgia 30155

or to such other address(es) as a party hereto shall have designated by
like notice to the other parties hereto.

5.4. Amendment. No provision of this Agreement may be modified,
amended, waived or discharged in any manner except by a written instrument
executed by Employer and Executive.

5
<PAGE> 6

5.5. Entire Agreement. This Agreement constitutes the entire
agreement of the parties hereto with respect to the subject matter hereof,
and supersedes all prior agreements and understandings of the parties
hereto, oral or written, with respect to the subject matter hereof.

5.6. Applicable Law. This Agreement shall be governed by and
construed in accordance with the laws of the Commonwealth of Virginia
applicable to contracts made and to be wholly performed therein without
regard to its conflicts or choice of law provisions.

5.7. Headings. The headings contained herein are for the sole
purpose of convenience of reference, and shall not in any way limit or
affect the meaning or interpretation of any of the terms or provisions of
this Agreement.

5.8. Binding Effect; Successors and Assigns. Executive may not
delegate his duties or assign his rights hereunder. This Agreement will
inure to the benefit of, and be binding upon, the parties hereto and their
respective heirs, legal representatives, successors and permitted assigns.

5.9. Waiver, etc. The failure of either of the parties hereto to at
any time enforce any of the provisions of this Agreement shall not be
deemed or construed to be a waiver of any such provision, nor to in any way
affect the validity of this Agreement or any provision hereof or the right
of either of the parties hereto to thereafter enforce each and every
provision of this Agreement. No waiver of any breach of any of the
provisions of this Agreement shall be effective unless set forth in a
written instrument executed by the party against whom or which enforcement
of such waiver is sought, and no waiver of any such breach shall be
construed or deemed to be a waiver of any other or subsequent breach.

5.10. Capacity, etc. Executive and Employer hereby represent and
warrant to the other that: (a) he or it has full power, authority and
capacity to execute and deliver this Agreement, and to perform his or its
obligations hereunder; (b) such execution, delivery and performance will
not (and with the giving of notice or lapse of time or both would not)
result in the breach of any agreements or other obligations to which he or
it is a party or he or it is otherwise bound; and (c) this Agreement is his
or its valid and binding obligation in accordance with its terms.

5.11. Enforcement. If any party institutes legal action to enforce
or interpret the terms and conditions of this Agreement, the prevailing
party shall be awarded reasonable attorneys' fees at all trial and
appellate levels, and the expenses and costs incurred by such prevailing
party in connection therewith. Venue for any such action shall exclusively
be Roanoke, Virginia.

5.12. Arbitration.

(i) Any dispute under Section 3 hereof, including but not limited
to the determination by the Board of a termination for Cause pursuant to
Section 3.2.3 hereof or in respect of the breach thereof will be settled
by arbitration in Roanoke, Virginia. The arbitration will be
accomplished in the following manner. Either party may serve upon the
other party written demand that the dispute, specifying the nature
thereof, shall be submitted to arbitration. Within ten (10) days after
the service of such demand, each of the parties will designate an
arbitrator and serve written notice of such appointment upon the other
party. If either party fails within the specified time to appoint such
arbitrator, the other party will be entitled to appoint both
arbitrators. The two (2) arbitrators so appointed will appoint a third
arbitrator.

(ii) The decision of the arbitrators will be final and binding upon
the parties. The arbitration will be conducted, to the extent consistent
with this Section 5.12, in accordance with the then prevailing rules of
commercial arbitration of the American Arbitration Association or its
successor.

5.13. Continuing Effect. Where the context of this Agreement
requires, the respective rights and obligations of the parties shall
survive any termination or expiration of the term of this Agreement.

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<PAGE> 7

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

INNOTECH, INC.

By: /s/ Ronald D. Blum
---------------------------------
Ronald D. Blum
Chairman and Chief
Executive Officer

/s/ Sunder Malkani
---------------------------------
SUNDER MALKANI

<PAGE> 1

EXHIBIT L

EMPLOYMENT AGREEMENT, dated as of April 1, 1996, between Innotech, Inc., a
corporation organized under the laws of the State of Delaware ("Employer"), and
Jo Ann Swasey ("Executive").

WHEREAS, Executive desires to provide services to Employer and Employer
desires to retain the services of Executive;

WHEREAS, Employer and Executive desire to formalize the terms and
conditions of Executive's employment with Employer.

NOW, THEREFORE, Employer and Executive hereby agree as follows:

1. Employment.

1.1. General. Employer hereby employs Executive in the capacity
of Treasurer and Controller hereby accepts such employment, upon the
terms and subject to the conditions herein contained.

1.2. Duties. During the Executive's employment with Employer,
Executive will report directly to the Chief Operating Officer, will be
responsible for performing those duties consistent with the position of
treasurer and controller and for performing such other duties as may
from time to time be assigned to or requested of Executive by Employer's
Chief Operating Officer, President or Chairman of the Board and/or the
Board of Directors (the "Board"). Executive shall use her reasonable
efforts to perform faithfully and effectively such responsibilities.
Executive shall conduct all of her activities in a manner so as to
maintain and promote the business and reputation of the Employer.

1.3. Full-Time Position. Executive, during her employment with
Employer, will devote all of her business time, attention and skills to
the business and affairs of Employer.

1.4. Location of Employment. Executive's place of employment
during her employment with Employer shall be in Roanoke, Virginia.
Notwithstanding anything to the contrary in this Agreement, in the event
Employer requires Executive to relocate to a location outside of the
metropolitan Roanoke area and Executive fails to so relocate, such
failure shall not be deemed to be grounds for termination for "Cause"
(as defined in Section 3.2.3. hereof).

2. Compensation and Benefits.

2.1. Salary. Employer will pay to Executive, and Executive will
accept, as full compensation for any and all services rendered and to be
rendered by her to Employer in all capacities during the term of her
employment under this Agreement, (i) a base salary at the annual rate of
$78,000 or at such rate as the Board, in its sole discretion, may
hereafter from time to time grant to Executive ("Base Salary"), payable
in accordance with the regular payroll practices of Employer, and (ii)
the additional benefits hereinafter set forth in this Section 2.

2.2. Additional Compensation. Executive shall be entitled to
participate in the Employer's Management Incentive Compensation Plan
("MICP") commencing on the date hereof and shall be entitled to any
awards granted pursuant to the terms thereof as determined by the Board.

2.3. Executive Benefits.

2.3.1. Expenses. Employer will reimburse Executive for
expenses she reasonably incurs in connection with the performance of
her duties (including business travel and entertainment expenses),
all in accordance with Employer's policies with respect thereto.

2.3.2. Employer Plans. Executive will be entitled to
participate in such executive benefit plans and programs as Employer
may from time to time offer or provide to executives of Employer,
including, but not limited to, participation in life insurance,
health and accident and medical plans and programs.
<PAGE> 2

2.3.3. Vacation. Executive shall be eligible for paid vacation
leave, accruing one day of leave for each 5.2 weeks of employment, or
10 days of paid leave per year. Executive shall be able to accrue
vacation days from year to year in accordance with Employer's
published vacation policies. Such vacation time shall be at such
times as shall be approved by the Chief Operating Officer, President
or Chairman of Employer.

3. Termination of Employment.

3.1. Termination. Executive's employment by Employer pursuant to
this Agreement shall commence on the date hereof and will continue until
the first anniversary of the date of this Agreement. Thereafter, it will
continue for successive one-year periods commencing on April 1 of each
subsequent year; provided, however, that either party may elect to
terminate this Agreement as of March 31, 1997, or as of any subsequent
March 31, by written notice to such effect delivered to the other party
at least 90 days prior to such termination date. Upon termination of
Executive's employment with Employer pursuant to Sections 3.2.2 through
3.2.6 hereof, inclusive, Executive will be released from any duties and
obligations hereunder (except those duties and obligations set forth in
Sections 4, 5.11, 5.12 and 5.13 hereof), and the obligations of Employer
to Executive will be as set forth in Section 3.3 hereof.

3.2. Events of Termination. Executive's employment with Employer
will terminate upon the occurrence of any one or more of the following
events:

3.2.1. Death. In the event of the Executive's death,
Executive's employment will terminate on the date of death.

3.2.2. Disability. In the event of Executive's Disability (as
hereinafter defined), Employer will have the option to terminate
Executive's employment by giving a notice of termination to
Executive. The notice of termination shall specify the date of
termination, which date shall not be earlier than thirty (30) days
after the notice of termination is given. For purposes of this
Agreement, "Disability" means the inability of Executive to
substantially perform her duties hereunder for 90 days out of 180
consecutive days as a result of a physical or mental illness, all as
determined in good faith by the Board.

3.2.3. Termination by Employer for Cause. Employer may, at its
option, terminate Executive's employment for "Cause" based on
objective factors determined in good faith by a majority of the Board
by giving a notice of termination to Executive specifying the reasons
for termination, and if Executive shall fail to cure same within ten
(10) days of her receiving the notice of termination, her Employment
shall terminate at the end of such ten (10) day period; provided,
that in the event the Board in good faith determines that the
underlying reasons giving rise to such determination cannot be cured,
then said cure period shall not apply and Executive's employment
shall terminate on the date of Executive's receipt of the notice of
termination. "Cause" shall mean (i) Executive's conviction of, guilty
plea to, or confession of guilt of, a felony, (ii) dishonest or
illegal conduct or misconduct or malfeasance by Executive in the
performance of services for or on behalf of the Employer, or other
conduct detrimental to the business, operations or reputation of the
Employer, regardless of whether such conduct is within the scope of
Executive's duties, (iii) failure by Executive to perform her duties,
as assigned to her by the Chief Executive Officer, President,
Chairman or the Board from time to time, (iv) violation by Executive
of the covenants set forth in this Agreement, (v) the filing by or
against Executive of any bankruptcy, insolvency or reorganization
proceeding and (vi) except as may be permitted herein, disclosure of
Confidential Information (as defined in Section 4.1 hereof) without
the prior written consent of Employer.

3.2.4. Without Cause By Employer. Employer may, at its option,
terminate the Executive's employment for any reason whatsoever (other
than for the reasons set forth above in this Section 3.2) by giving a
notice of termination to Executive, and Executive's employment shall
terminate on the later of the date the notice of termination is given
or the date set forth in such notice of termination.

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<PAGE> 3

3.2.5. Employer's Material Breach. Executive may, at her
option, terminate the Executive's employment upon Employer's material
breach of this Agreement by giving Employer written notice of such
breach (which notice will identify the manner in which Employer has
materially breached this Agreement) and if such breach is not cured
within thirty (30) days of Employer receiving such written notice,
the Executive's employment shall terminate at the end of such thirty
(30) day period. Employer's "Material Breach" of this Agreement shall
mean (i) the failure of Employer to pay Base Salary or additional
compensation hereunder in accordance with this Agreement or (ii) the
assignment to Executive without Executive's consent of duties
substantially inconsistent with her duties as set forth in Section
1.2 hereof. Notwithstanding the foregoing, Employer shall have the
right to remove Executive's title and duties as Treasurer of the
Corporation, and such change shall not be deemed to be a material
breach by Employer of this Agreement. Employer shall not be entitled
to the payments provided in Section 3.3.2 hereof solely as a result
of such change in title and duties.

3.2.6. Without Cause By Executive. Executive may terminate the
Executive's employment for any reason whatsoever by giving a notice
of termination to Employer. The Executive's employment shall
terminate on the earlier of (i) the date, following the date of the
notice of termination, upon which a suitable replacement for
Executive is found by Employer, or (ii) 5 days after the date of
receipt by Employer of the notice of termination.

3.3. Certain Obligations of Employer Following Termination of the
Executive's Employment. Following the termination of Executive's
employment under the circumstances described below, Employer will pay to
Executive in accordance with its regular payroll practices the following
compensation and provide the following benefits in full satisfaction and
final settlement of any and all claims and demands that Executive now
has or hereafter may have hereunder a gainst Employer:

3.3.1. Death; Disability. In the event that Executive's
employment is terminated by reason of Executive's death or
Disability, Executive or her estate, as the case may be, shall be
entitled to the following payments:

(i) Base Salary through the date the Executive's employment
is terminated; and

(ii) Employer shall pay to Executive or her estate, as the
case may be, the amounts and shall provide all benefits generally
available under the employee benefit plans, and the policies and
practices of Employer, determined in accordance with the
applicable terms and provisions of such plans, policies and
practices, in each case, as accrued to the date of termination or
otherwise payable as a consequence of Executive's death or
Disability.

3.3.2. Without Cause by Employer; Material Breach by
Employer. In the event that the Executive's employment is terminated
by Employer pursuant to Section 3.2.4 hereof or by Executive pursuant
to Section 3.2.5 hereof, Executive shall be entitled to the following
payments:

(i) Base Salary through the date the Executive's employment
is terminated; and

(ii) a pro-rata portion of any amounts Executive would be
entitled to under the MICP, if any, accrued on or prior to date
Executive's employment is terminated for any reason hereunder.

(iii) continuing payments of Base Salary, payable in
accordance with the regular payroll practices of Employer, for
six (6) months following the date of termination of Executive's
employment.

3.3.3. Termination by Executive Without Cause or by Employer
for Cause. In the event the Executive's employment is terminated by
Executive pursuant to Section 3.2.6 hereof or by Employer pursuant to
Section 3.2.3 hereof, Executive shall be entitled to no further
compensation or other benefits under this Agreement except as to that
portion of any unpaid Base Salary and other benefits accrued and
earned by her hereunder up to and including the effective date of

3
<PAGE> 4

such termination. In addition, Executive shall be entitled to receive
any additional compensation earned but not yet paid with respect only
to any calendar year prior to the calendar year of termination.

3.4. Nature of Payments. All amounts to be paid by Employer to
Executive pursuant to this Section 3 are considered by the parties to be
severance payments. In the event such payments are treated as damages,
it is expressly acknowledged by the parties that damages to Executive
for termination of employment would be difficult to ascertain and the
above amounts are reasonable estimates thereof.

4. Confidentiality; Nonsolicitation; Non-Compete.

4.1. Confidential Information Defined. "Confidential Information"
means any and all information (oral or written) relating to Employer or
any person controlling, controlled by, or under common control with
Employer or any of their respective activities, including, but not
limited to, information relating to: discoveries, innovations,
chemistry, patents, patent applications, know how, secret processes,
research, test procedures and results, machinery and equipment;
manufacturing processes; financial information; products; identity and
description of materials and services used; purchasing; costs; pricing;
customers and prospects; advertising, promotion and marketing;
trademarks and trademark registrations; copyrights and copyright
registrations; and information pertaining to any governmental
investigation, except such information which can be shown by Executive
to be generally in the public domain (such information not being deemed
to be in the public domain merely because it is embraced by more general
information which is in the public domain), other than as a result of a
breach of the provisions of Section 4.2 hereof.

4.2. Nondisclosure of Confidential Information. Executive will
not, at any time (other than as may be required or appropriate in
connection with the performance by her of her duties hereunder) directly
or indirectly, use, communicate, disclose or disseminate any
Confidential Information in any manner whatsoever (except as may be
required under legal process by subpoena or other court order; provided,
that, Executive will take reasonable steps to give Employer sufficient
prior written notice in order to contest such requirement or order).

4.3. Certain Activities. Executive will not while employed by
Employer and thereafter, directly or indirectly, hire, offer to hire,
entice away or in any other manner persuade or attempt to persuade any
officer, employee, agent, lessor, lessee, licensor, licensee, customer,
prospective customer, supplier or shareholder or prospective shareholder
of Employer to discontinue or alter her or its relationship with
Employer.

4.4. Covenant Not to Compete. During the Executive's employment
and for a period of two (2) years after the termination of Executive's
employment, Executive will not directly or indirectly engage in
competition with Employer by being associated with any competitor of
Employer that sells or offers to sell any products or services which
compete with the products or services offered or sold by Employer or
being developed by Employer for sale at the time of termination of the
Executive, or induce or attempt to induce, directly or indirectly, any
then current or potential customer of Employer to cease doing business,
in whole or in part, with Employer or solicit business of any such
customer for any products or services of any competitor of Employer
which compete with the products or services offered or sold by Employer
or being developed by Employer for sale at the time of termination of
the Executive. Notwithstanding the foregoing, in the event Executive's
employment is terminated by Employer without Cause or due to Employer's
Material Breach of this Agreement, this Section 4.4 shall only apply to
the products or services offered or sold by Employer that relate to its
SurfaceCasting technology.

4.5. Injunctive Relief. Executive acknowledges and agrees that
(a) Employer will be irreparably injured in the event of a breach by
Executive of any of her obligations under this Section 4; (b) monetary
damages will not be an adequate remedy for any such breach; (c) Employer
will be entitled to injunctive relief, in addition to any other remedy
which it may have, in the event of any

4
<PAGE> 5

such breach, including, but not limited to, termination of the
Executive's employment for Cause; and (d) the existence of any claims
which Executive may have against Employer, whether under this Agreement
or otherwise, will not be a defense to the enforcement by Employer of
any of its rights under this Section 4.

4.6. Nonexclusivity and Survival. The covenants and obligations
of Executive contained in this Section 4 are in addition to, and not in
lieu of, any covenants and obligations which Executive may have with
respect to the subject matter hereof, whether by contract, as a matter
of law or otherwise, and such covenants and obligations, and their
enforceability, will survive any termination of Executive's employment
by either party and any investigation made with respect to the breach
thereof by Employer at any time.

5. Miscellaneous Provisions.

5.1. Severability. If in any jurisdiction any term or provision
hereof is determined to be invalid or unenforceable, (a) the remaining
terms and provisions hereof shall be unimpaired, (b) any such invalidity
or unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction, and (c) the
invalid or unenforceable term or provision shall, for purposes of such
jurisdiction, be deemed replaced by a term or provision that is valid
and enforceable and that comes closest to expressing the intention of
the invalid or unenforceable term or provision.

5.2. Execution in Counterparts. This Agreement may be executed in
one or more counterparts, and by the different parties hereto in
separate counterparts, each of which shall be deemed to be an original
but all of which taken together shall constitute one and the same
agreement (and all signatures need not appear on any one counterpart),
and this Agreement shall become effective when one or more counterparts
has been signed by each of the parties hereto and delivered to each of
the other parties hereto.

5.3. Notices. All notices, requests, demands and other
communications hereunder shall be in writing and shall be deemed duly
given when delivered by hand, or when delivered if mailed by registered
or certified mail or private courier service, postage prepaid, return
receipt requested or via facsimile (with written confirmation of
receipt) as follows:

If to Employer, to:

Innotech, Inc.
5568 Airport Road
Roanoke, VA 24012
Attention: Dr. Ronald Blum, Chairman
Telefax No.: (703) 366-5177

Copy to:

Joel D. Zychick, Esq.
c/o Hertzog, Calamari & Gleason
100 Park Avenue
New York, NY 10017
Telefax No.: (212) 213-1199

If to Executive, to:

Ms. Jo Ann Swasey
Route 1, Box 18
Hardy, VA 24101

or to such other address(es) as a party hereto shall have designated
by like notice to the other parties hereto.

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<PAGE> 6

5.4. Amendment. No provision of this Agreement may be modified,
amended, waived or discharged in any manner except by a written
instrument executed by Employer and Executive.

5.5. Entire Agreement. This Agreement constitutes the entire
agreement of the parties hereto with respect to the subject matter
hereof, and supersedes all prior agreements and understandings of the
parties hereto, oral or written, with respect to the subject matter
hereof.

5.8. Binding Effect; Successors and Assigns. Executive may not
delegate her duties or assign her rights hereunder. This Agreement will
inure to the benefit of, and be binding upon, the parties hereto and
their respective heirs, legal representatives, successors and permitted
assigns.

5.9. Waiver, etc. The failure of either of the parties hereto to
at any time enforce any of the provisions of this Agreement shall not be
deemed or construed to be a waiver of any such provision, nor to in any
way affect the validity of this Agreement or any provision hereof or the
right of either of the parties hereto to thereafter enforce each and
every provision of this Agreement. No waiver of any breach of any of the
provisions of this Agreement shall be effective unless set forth in a
written instrument executed by the party against whom or which
enforcement of such waiver is sought, and no waiver of any such breach
shall be construed or deemed to be a waiver of any other or subsequent
breach.

5.10. Capacity, etc. Executive and Employer hereby represent and
warrant to the other that: (a) she or it has full power, authority and
capacity to execute and deliver this Agreement, and to perform her or
its obligations hereunder; (b) such execution, delivery and performance
will not (and with the giving of notice or lapse of time or both would
not) result in the breach of any agreements or other obligations to
which she or it is a party or she or it is otherwise bound; and (c) this
Agreement is her or its valid and binding obligation in accordance with
its terms.

5.11. Enforcement. If any party institutes legal action to
enforce or interpret the terms and conditions of this Agreement, the
prevailing party shall be awarded reasonable attorneys' fees at all
trial and appellate levels, and the expenses and costs incurred by such
prevailing party in connection therewith. Venue for any such action
shall exclusively be Roanoke, Virginia.

5.12. Arbitration.

(i) Any dispute under Section 3 hereof, including but not
limited to the determination by the Board of a termination for Cause
pursuant to Section 3.2.3 hereof or in respect of the breach thereof
will be settled by arbitration in Roanoke, Virginia. The arbitration
will be accomplished in the following manner. Either party may serve
upon the other party written demand that the dispute, specifying the
nature thereof, shall be submitted to arbitration. Within ten (10)
days after the service of such demand, each of the parties will
designate an arbitrator and serve written notice of such appointment
upon the other party. If either party fails within the specified time
to appoint such arbitrator, the other party will be entitled to
appoint both arbitrators. The two (2) arbitrators so appointed will
appoint a third arbitrator.

(ii) The decision of the arbitrators will be final and binding
upon the parties. The arbitration will be conducted, to the extent
consistent with this Section 5.12, in accordance with the then
prevailing rules of commercial arbitration of the American
Arbitration Association or its successor.

5.13. Continuing Effect. Where the context of this Agreement
requires, the respective rights and obligations of the parties shall
survive any termination or expiration of the term of this Agreement.

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<PAGE> 7

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

INNOTECH, INC.

By: /s/ Ronald D. Blum
------------------------------------
Ronald D. Blum
Chairman and Chief
Executive Officer

/s/ Jo Ann Swasey
------------------------------------
JO ANN SWASEY

<PAGE> 1

EXHIBIT M

NONCOMPETITION AGREEMENT

THIS NONCOMPETITION AGREEMENT (the "Agreement") is made and entered this
10th day of February 1997, by and between JOHNSON & JOHNSON, a New Jersey
corporation ("J&J"), and DR. RONALD BLUM, an individual (the "Stockholder").

WITNESSETH

WHEREAS, the Stockholder is a stockholder of Innotech, Inc., a Delaware
corporation (the "Company"), and is also a key executive officer of the Company;
and

WHEREAS, pursuant to, and subject to the terms and conditions of, an
Agreement and Plan of Merger with the Company (the "Merger Agreement"), J&J
through a subsidiary ("Sub") will make a tender offer (the "Offer") to purchase
all the issued and outstanding shares of capital stock of the Company (the
"Shares"), and the now existing stockholders of the Company will receive a cash
payment per share constituting a significant premium to the market price of the
stock of the Company; and

WHEREAS, the Board of Directors of the Company has adopted resolutions
approving the Offer and the subsequent merger of Sub into the Company (the
"Merger"), upon the terms and subject to the conditions set forth in the Merger
Agreement; and

WHEREAS, following the Merger, J&J intends, or intends to cause Sub, to
continue to conduct and operate the business of the Company; and

WHEREAS, as an inducement to J&J to enter into the Merger Agreement and to
acquire the Company stock owned by (and to pay the amount set forth in Section
7.04(a) of the Merger Agreement in respect of the Company stock options held by)
the Stockholder, the Stockholder is entering into this Agreement:

NOW, THEREFORE, in consideration of the foregoing and the mutual agreements
hereinafter set forth, the parties hereto agree as follows:

1. Noncompetition. (a) The Stockholder agrees that for the period of
the Stockholder's employment following the Closing with J&J, or any
subsidiary thereof, and for two (2) years following the termination of such
employment (regardless of the circumstances under which such employment is
terminated) (such period, the "Noncompetition Period"), the Stockholder
will not have any Relationship (as defined below) with any entity,
including but not limited to any corporation, partnership, limited
liability company, sole proprietorship or unincorporated business (whether
or not for profit) (such entity, a "Business") in the course of which
Relationship the Stockholder engages in or assists such Business with
respect to the ophthalmic spectacle lens business (which business shall not
include lens analyzing equipment) ("Lens Products and Services").

(b) In the event that the Company terminates the Stockholder's
employment without Cause (as defined below), the Company shall (x) continue
to pay such Stockholder through the end of the Noncompetition Period
(payable in accordance with the regular payroll practices of the Company)
an annual amount equal to the salary that the Stockholder was receiving
immediately prior to such termination and (y) continue to provide all
benefits generally available under employee benefit plans or the practices
and policies of the Company at the time of such termination (other than
stock option or similar plans), determined in accordance with the
provisions of such plans, practices and policies. "Cause" shall mean (i)
Stockholder's conviction of, guilty plea to, or confession of guilt of, a
felony, (ii) dishonest or illegal conduct or misconduct or malfeasance by
the Stockholder in the performance of services for or on behalf of the
Company, or other conduct detrimental to the business, operations or
reputation of the Company, regardless of whether such conduct is within the
scope of Stockholder's duty, (iii) failure by the Stockholder to perform
his duties, as assigned to him by Bernard W. Walsh from time to time,
provided that such duties are not inconsistent with the Stockholder's
current duties, or
<PAGE> 2

(iv) violation by the Stockholder of the covenants set forth in this
Agreement; provided, however, that "Cause" shall, in no circumstances mean
the failure by the Stockholder to relocate in the event the Company
relocates its place of business and the Stockholder is unable to perform
his duties without so relocating.

(c) The Stockholder will be deemed to have a relationship (a
"Relationship") with a Business if such Stockholder (i) owns, manages,
operates, joins, or is employed by such Business, (ii) is a director,
member, agent, shareholder, owner or general partner of such Business,
(iii) acts as a consultant or advisor to such Business or (iv) controls or
participates in the ownership, management or operation of, such Business;
provided however, that nothing herein shall prevent the purchase or
ownership by the Stockholder (and his "associates" as defined by the
Securities and Exchange Commission's Proxy Rules) of an interest in a
Business that constitutes less than 5% of the outstanding equity securities
of such Business.

2. Nonsolicitation of Clients. During the Noncompetition Period, the
Stockholder agrees that he will not directly or indirectly provide Lens
Products and Services (whether as an employee, consultant, advisor or
otherwise) to any entity that at such time is, or at any time in the twelve
(12) month period prior to such time had been, a customer of the Company
unless (a) the Stockholder is employed by J&J or a subsidiary thereof and
such solicitation is made on behalf of, or payment for the performance of
such services is made to, such employer or (b) the Stockholder shall have
previously obtained a written release specifically permitting an action
that would otherwise be prohibited by the provisions of this Paragraph 2.

3. Nonsolicitation of Employees and Consultants. During the
Noncompetition Period, the Stockholder agrees that he will not directly or
indirectly solicit, influence, entice or encourage any person who at such
time is, or who at any time in the three (3) month period prior to such
time had been, an employee of or consultant to the Company or J&J to cease
or curtail his or her relationship therewith.

4. Nondisruption; Other Matters. During the Noncompetition Period,
the Stockholder agrees that he will not directly or indirectly interfere
with, disrupt or attempt to disrupt any past, present or prospective
relationship, contractual or otherwise, between the Company or J&J, on the
one hand, and any of their respective customers, suppliers or employees, on
the other hand.

5. Confidential Information. The Stockholder covenants and agrees
that, during the Noncompetition Period, he shall not use for his own behalf
or divulge to any other person or entity any confidential information or
trade secrets of or relating to the Company. The Stockholder further
covenants and agrees that, during the Noncompetition Period, he shall not
take or remove from the property of the Company any documentary copies,
records or materials containing any such confidential information or trade
secrets. As used herein, confidential information shall consist of all
information, knowledge or data relating to the Company or J&J (including
all information relating to inventions, production methods, customer and
prospective customer lists, prices and trade practices) which is not in the
public domain or otherwise published or publicly available.

6. Equitable Relief. The Stockholder acknowledges and agrees that
J&J's remedies at law for breach of any of the provisions of this Agreement
would be inadequate and, in recognition of this fact, the Stockholder
agrees that, in the event of such breach, in addition to any remedies at
law it may have, J&J, without posting any bond, shall be entitled to obtain
equitable relief in the form of specific performance, a temporary
restraining order, a temporary or permanent injunction or any other
equitable remedy that may be available. The Stockholder further
acknowledges that should the Stockholder violate any of the provisions of
this Agreement, it will be difficult to determine the amount of damages
resulting to J&J or its affiliates and that in addition to any other
remedies it may have J&J shall be entitled to temporary and permanent
injunctive relief.

7. Merger Agreement. J&J represents that concurrently with the
execution of this Agreement, J&J is executing the Merger Agreement, and
subject to the terms of the Merger Agreement will cause the Offer to be
commenced as provided in the Merger Agreement.

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<PAGE> 3

8. Acknowledgement. Each of the Stockholder and J&J acknowledges and
agrees that the covenants and agreements contained in this Agreement have
been negotiated in good faith by the parties, and are reasonable and are
not more restrictive or broader than necessary to protect the interests of
the parties hereto, and would not achieve their intended purpose if they
were on different terms or for periods of time shorter than the periods of
time provided herein or applied in more restrictive geographical areas than
are provided herein. Each party further acknowledges that J&J would not
enter into the Merger Agreement and the transactions contemplated thereby
(including, without limitation, the purchase of the Shares held by the
Stockholder and payment in respect of the stock options granted to him by
the Company) in the absence of the covenants and agreements contained in
this Agreement and that such covenants and agreements are essential to
protect the value of the Company.

9. Reasonableness of Provisions; Severability. The Stockholder
expressly understands and agrees that although both he and J&J consider the
covenants and agreements contained in this Agreement, including the
restrictions contained in Paragraphs 1, 2, 3, 4, and 5, to be reasonable,
if a final judicial determination is made by a court of competent
jurisdiction that the time or territory restrictions contained herein, or
any other provision or restriction contained herein, is an unenforceable
provision or restriction against the Stockholder, the provisions and
restrictions of this Agreement shall not be rendered void but shall be
deemed amended to apply as to such maximum time and territory and to such
maximum extent as such court may judicially determine or indicate to be
enforceable. Alternatively, if any court of competent jurisdiction finds
that any provision or restriction contained in this Agreement is
unenforceable, and such provision or restriction cannot be amended so as to
make it enforceable, such finding shall not affect the enforceability of
any of the remaining provisions and restrictions contained herein, which
remaining provisions and restrictions shall be deemed severable from the
unenforceable provision or restriction and shall remain in full force and
effect.

10. Not an Employment Agreement. This Agreement is not, and nothing
in this Agreement shall be construed as, an agreement to provide employment
to the Stockholder. The provisions of Paragraphs 1, 2, 3, 4, and 5 of this
Agreement shall be operative regardless of the reasons for any termination
of the Stockholder's employment and regardless of the performance or
nonperformance by any party under any other section of this Agreement.

11. Governing Law. This Agreement is made under and shall be
governed by, construed in accordance with and enforced under the laws of
the State of New York, without regard to conflict of laws provisions of New
York law.

12. Entire Agreement. This Agreement together with the Merger
Agreement and the Stockholder Agreement (as defined in the Merger
Agreement) constitutes and contains the entire agreement and understanding
concerning the subject matter addressed herein between the parties, and
supersedes and replaces all prior negotiations and all agreements proposed
or otherwise, whether written or oral, concerning the subject matter
hereof, and the parties hereto have made no agreements, representations or
warranties relating to the subject matter of this Agreement that are not
set forth herein or in the Merger Agreement or the Stockholder Agreement.

3
<PAGE> 4

13. Notices. Any notice or demand hereunder shall be given in
writing to the address set forth below by personal service or registered or
certified mail, postage prepaid, return receipt requested, or overnight
courier:

If to J&J, to:

Johnson & Johnson
One Johnson & Johnson Plaza
New Brunswick, NJ 08933
Attention: General Counsel

If to the Stockholder:

DR. RONALD BLUM

Such address may be changed by notice to the other party as provided
above. Notices given pursuant to this Paragraph shall be deemed effective
upon receipt.

14. Waiver of Jury Trial. EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL
PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT.

15. Amendments: No Waiver. (a) No amendment or modification of this
Agreement shall be deemed effective unless made in writing and signed by
the parties hereto.

(b) No term or condition of this Agreement shall be deemed to have
been waived, nor shall there be any estoppel to enforce any provision of
this Agreement, except by a statement in writing signed by the party
against whom enforcement of the waiver or estoppel is sought. Any written
waiver shall operate only as to the specific term or condition waived and
shall not constitute a waiver of such term or condition for the future or
as to any act other than that specifically waived.

16. Assignment. This Agreement may be assigned by J&J to any
affiliate of J&J or to any nonaffiliate of J&J that shall succeed to the
business and assets of the Company. In the event of any such assignment,
J&J shall cause such affiliate or nonaffiliate, as the case may be, to
assume the obligations of J&J hereunder, by a written agreement addressed
to the Stockholder, concurrently with any assignment with the same effect
as if such assignee were "J&J" hereunder. This Agreement is personal to the
Stockholder and the Stockholder may not assign any rights or delegate any
responsibilities hereunder.

17. Headings. The headings of paragraphs in this Agreement are
solely for convenience of reference and shall not control the meaning or
interpretation of any provision of this Agreement.

18. Counterparts. This Agreement may be executed in counterparts,
each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.

19. Binding Effect; Benefit. This Agreement shall be binding upon
execution and shall become effective when J&J or a subsidiary acquires a
majority of the Shares. This Agreement shall thereafter continue in effect
and shall inure to the benefit of and be binding upon the parties hereto.
Nothing in this Agreement, express or implied, is intended to confer on any
person other than the parties hereto, and their respective successors, any
rights, remedies, obligations or liabilities under or by reason of this
Agreement.

4
<PAGE> 5

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

DR. RONALD BLUM,

by /s/ DR. RONALD BLUM

------------------------------------
Name: Dr. Ronald Blum

JOHNSON & JOHNSON,

by /s/ ROGER S. FINE

------------------------------------
Name: Roger S. Fine
Title:

<PAGE> 1

EXHIBIT N

NONCOMPETITION AGREEMENT

THIS NONCOMPETITION AGREEMENT (the "Agreement") is made and entered this
10th day of February 1997, by and between JOHNSON & JOHNSON, a New Jersey
corporation ("J&J"), and DR. AMITAVA GUPTA, an individual (the "Stockholder").

W I T N E S S E T H

WHEREAS, the Stockholder is a stockholder of Innotech, Inc., a Delaware
corporation (the "Company"), and is also a key executive officer of the Company;
and

WHEREAS, pursuant to, and subject to the terms and conditions of, an
Agreement and Plan of Merger
with the Company (the "Merger Agreement"), J&J through a subsidiary ("Sub") will
make a tender offer (the "Offer") to purchase all the issued and outstanding
shares of capital stock of the Company (the "Shares"), and the now existing
stockholders of the Company will receive a cash payment per share constituting a
significant premium to the market price of the stock of the Company; and

WHEREAS, following the Merger, J&J intends, or intends to cause Sub, to
continue to conduct and operate the business of the Company; and

NOW, THEREFORE, in consideration of the foregoing and the mutual agreements
hereinafter set forth, the parties hereto agree as follows:

1. Noncompetition. (a) The Stockholder agrees that for the period of
the Stockholder's employment following the Closing with J&J, or any
subsidiary thereof, and for two (2) years following the termination of such
employment (regardless of the circumstances under which such employment is
terminated) (such period, the "Noncompetition Period"), the Stockholder
will not have any Relationship (as defined below) with any entity,
including but not limited to any corporation, partnership, limited
liability company, sole proprietorship or unincorporated business (whether
or not for profit) (such entity, a "Business") in the course of which
Relationship the Stockholder engages in or assists such Business with
respect to the ophthalmic lens business (which business shall not include
lens analyzing equipment) ("Lens Products and Services"). The foregoing
shall not preclude the Stockholder from having a Relationship with Prism
Ophthalmics, L.L.C., provided that the Stockholder's Relationship therewith
is not inconsistent with the Letter Agreement dated the date hereof, a copy
of which is attached hereto as Exhibit A.

reputation of the Company, regardless of whether such conduct is within the
scope of Stockholder's duty, (iii) failure by the Stockholder to perform
his duties, as assigned to him by the senior officer of the Company from
time to time, provided that such duties are not inconsistent with the
Stockholder's current duties, or (iv) violation by the Stockholder of the
covenants set forth in this Agreement; provided, however, that "Cause"
shall, in no circumstances mean the failure by the Stockholder to relocate
in the event the Company relocates its place of business and the
Stockholder is unable to perform his duties without so relocating.

2. Nonsolicitation of Clients. During the Noncompetition Period, the
Stockholder agrees that he
will not directly or indirectly provide Lens Products and Services (whether
as an employee, consultant, advisor or otherwise) to any entity that at
such time is, or at any time in the twelve (12) month period prior to such
time had been, a customer of the Company unless (a) the Stockholder is
employed by J&J or a subsidiary thereof and such solicitation is made on
behalf of, or payment for the performance of such services is made to, such
employer or (b) the Stockholder shall have previously obtained a written
release specifically permitting an action that would otherwise be
prohibited by the provisions of this Paragraph 2.

6. Position. The Stockholder will at all times report directly to
the Chief Executive Officer of the Company, or if there is no Chief
Executive Officer, to the highest executive officer of the Company.

7. Equitable Relief. The Stockholder acknowledges and agrees that
J&J's remedies at law for breach of any of the provisions of this Agreement
would be inadequate and, in recognition of this fact, the Stockholder
agrees that, in the event of such breach, in addition to any remedies at
law it may have, J&J, without posting any bond, shall be entitled to obtain
equitable relief in the form of specific performance, a temporary
restraining order, a temporary or permanent injunction or any other
equitable remedy that may be available. The Stockholder further
acknowledges that should the Stockholder violate any of the provisions of
this Agreement, it will be difficult to determine the amount of damages
resulting to J&J or

2
<PAGE> 3

its affiliates and that in addition to any other remedies it may have J&J
shall be entitled to temporary and permanent injunctive relief.

8. Merger Agreement. J&J represents that concurrently with the
execution of this Agreement, J&J is executing the Merger Agreement, and
subject to the terms of the Merger Agreement will cause the Offer to be
commenced as provided in the Merger Agreement.

9. Acknowledgement. Each of the Stockholder and J&J acknowledges and
agrees that the covenants and agreements contained in this Agreement have
been negotiated in good faith by the parties, and are reasonable and are
not more restrictive or broader than necessary to protect the interests of
the parties hereto, and would not achieve their intended purpose if they
were on different terms or for periods of time shorter than the periods of
time provided herein or applied in more restrictive geographical areas than
are provided herein. Each party further acknowledges that J&J would not
enter into the Merger Agreement and the transactions contemplated thereby
(including, without limitation, the purchase of the Shares held by the
Stockholder and payment in respect of the stock options granted to him by
the Company) in the absence of the covenants and agreements contained in
this Agreement and that such covenants and agreements are essential to
protect the value of the Company.

10. Reasonableness of Provisions; Severability. The Stockholder
expressly understands and agrees that although both he and J&J consider the
covenants and agreements contained in this Agreement, including the
restrictions contained in Paragraphs 1, 2, 3, 4, and 5, to be reasonable,
if a final judicial determination is made by a court of competent
jurisdiction that the time or territory restrictions contained herein, or
any other provision or restriction contained herein, is an unenforceable
provision or restriction against the Stockholder, the provisions and
restrictions of this Agreement shall not be rendered void but shall be
deemed amended to apply as to such maximum time and territory and to such
maximum extent as such court may judicially determine or indicate to be
enforceable. Alternatively, if any court of competent jurisdiction finds
that any provision or restriction contained in this Agreement is
unenforceable, and such provision or restriction cannot be amended so as to
make it enforceable, such finding shall not affect the enforceability of
any of the remaining provisions and restrictions contained herein, which
remaining provisions and restrictions shall be deemed severable from the
unenforceable provision or restriction and shall remain in full force and
effect.

11. Not an Employment Agreement. This Agreement is not, and nothing
in this Agreement shall be construed as, an agreement to provide employment
to the Stockholder. The provisions of Paragraphs 1, 2, 3, 4, and 5 of this
Agreement shall be operative regardless of the reasons for any termination
of the Stockholder's employment and regardless of the performance or
nonperformance by any party under any other section of this Agreement.

12. Governing Law. This Agreement is made under and shall be
governed by, construed in accordance with and enforced under the laws of
the State of New York, without regard to conflict of laws provisions of New
York law.

13. Entire Agreement. This Agreement together with the Merger
Agreement and the Stockholder Agreement (as defined in the Merger
Agreement) constitutes and contains the entire agreement and understanding
concerning the subject matter addressed herein between the parties, and
supersedes and replaces all prior negotiations and all agreements proposed
or otherwise, whether written or oral, concerning the subject matter
hereof, and the parties hereto have made no agreements, representations or
warranties relating to the subject matter of this Agreement that are not
set forth herein or in the Merger Agreement or the Stockholder Agreement.

3
<PAGE> 4

14. Notices. Any notice or demand hereunder shall be given in
writing to the address set forth below by personal service or registered or
certified mail, postage prepaid, return receipt requested, or overnight
courier:

If to J&J, to:

Johnson & Johnson
One Johnson & Johnson Plaza
New Brunswick, NJ 08933
Attention: General Counsel

If to the Stockholder:

Dr. Amitava Gupta
5322 Fox Den Road
Roanaoke, VA 24014

Such address may be changed by notice to the other party as provided
above. Notices given pursuant to this Paragraph shall be deemed effective
upon receipt.

15. Waiver of Jury Trial. EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL
PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT.

16. Amendments: No Waiver. (a) No amendment or modification of this
Agreement shall be deemed effective unless made in writing and signed by
the parties hereto.

17. Assignment. This Agreement may be assigned by J&J to any
affiliate of J&J or to any nonaffiliate of J&J that shall succeed to the
business and assets of the Company. In the event of any such assignment,
J&J shall cause such affiliate or nonaffiliate, as the case may be, to
assume the obligations of J&J hereunder, by a written agreement addressed
to the Stockholder, concurrently with any assignment with the same effect
as if such assignee were "J&J" hereunder. This Agreement is personal to the
Stockholder and the Stockholder may not assign any rights or delegate any
responsibilities hereunder.

18. Headings. The headings of paragraphs in this Agreement are
solely for convenience of reference and shall not control the meaning or
interpretation of any provision of this Agreement.

19. Counterparts. This Agreement may be executed in counterparts,
each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.

20. Binding Effect; Benefit. This Agreement shall be binding upon
execution and shall become effective when J&J or a subsidiary acquires a
majority of the Shares. This Agreement shall thereafter continue in effect
and shall inure to the benefit of and be binding upon the parties hereto.
Nothing in this Agreement, express or implied, is intended to confer on any
person other than the parties hereto, and their respective successors, any
rights, remedies, obligations or liabilities under or by reason of this
Agreement.

4
<PAGE> 5

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

DR. AMITAVA GUPTA,
/s/ DR. AMITAVA GUPRA

--------------------------------------
Name: Dr. Amitava Gupra

JOHNSON & JOHNSON,

by /s/ ROGER S. FINE

------------------------------------
Name: Roger S. Fine
Title:

<PAGE> 1

EXHIBIT O

NONCOMPETITION AGREEMENT

THIS NONCOMPETITION AGREEMENT (the "Agreement") is made and entered this
10th day of February 1997, by and between JOHNSON & JOHNSON, a New Jersey
corporation ("J&J"), and STEVEN A. BENNINGTON, an individual (the
"Stockholder").

W I T N E S S E T H

WHEREAS, the Stockholder is a stockholder of Innotech, Inc., a Delaware
corporation (the "Company"), and is also a key executive officer of the Company;
and

WHEREAS, following the Merger, J&J intends, or intends to cause Sub, to
continue to conduct and operate the business of the Company; and

NOW, THEREFORE, in consideration of the foregoing and the mutual agreements
hereinafter set forth, the parties hereto agree as follows:

2
<PAGE> 3

3
<PAGE> 4

If to J&J, to:

Johnson & Johnson
One Johnson & Johnson Plaza
New Brunswick, NJ 08933
Attention: General Counsel

If to the Stockholder:

Steven A. Bennington
1574 Strawberry Mtn. Dr.
Roanoke, VA 24018

Such address may be changed by notice to the other party as provided
above. Notices given pursuant to this Paragraph shall be deemed effective
upon receipt.

14. Waiver of Jury Trial. EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL
PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT.

15. Amendments: No Waiver. (a) No amendment or modification of this
Agreement shall be deemed effective unless made in writing and signed by
the parties hereto.

17. Headings. The headings of paragraphs in this Agreement are
solely for convenience of reference and shall not control the meaning or
interpretation of any provision of this Agreement.

18. Counterparts. This Agreement may be executed in counterparts,
each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.

4
<PAGE> 5

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

STEVEN A. BENNINGTON,

/s/ STEVEN A. BENNINGTON
--------------------------------------
Name: Steven A. Bennington

JOHNSON & JOHNSON,

by /s/ ROGER S. FINE
------------------------------------
Name: Roger S. Fine
Title:

<PAGE> 1

EXHIBIT P

NONCOMPETITION AGREEMENT

THIS NONCOMPETITION AGREEMENT (the "Agreement") is made and entered this
10th day of February 1997, by and between JOHNSON & JOHNSON, a New Jersey
corporation ("J&J"), and ROBERT P. PADULA, an individual (the "Stockholder").

W I T N E S S E T H

WHEREAS, the Stockholder is a stockholder of Innotech, Inc., a Delaware
corporation (the "Company"), and is also a key executive officer of the Company;
and

WHEREAS, following the Merger, J&J intends, or intends to cause Sub, to
continue to conduct and operate the business of the Company; and

NOW, THEREFORE, in consideration of the foregoing and the mutual agreements
hereinafter set forth, the parties hereto agree as follows:

(b) In the event that the Company terminates the Stockholder's
employment without Cause (as defined below), the Company shall (x) continue
to pay such Stockholder through the end of the Noncompetition Period
(payable in accordance with the regular payroll practices of the Company)
an annual amount equal to the salary that the Stockholder was receiving
immediately prior to such termination and (y) continue to provide all
benefits generally available under employee benefit plans or the practices
and policies of the Company at the time of such termination (other than
stock option or similar plans), determined in accordance with the
provisions of such plans, practices and policies. "Cause" shall mean (i)
Stockholder's conviction of, guilty plea to, or confession of guilt of, a
felony, (ii) dishonest or illegal conduct or misconduct or malfeasance by
the Stockholder in the performance of services for or on behalf of the
Company, or other conduct detrimental to the business, operations or
reputation of the Company, regardless of whether such conduct is within the
scope of Stockholder's duty, (iii) failure by the Stockholder to perform
his duties, as assigned to him by the President from time to time, provided
that such duties are not inconsistent with the Stockholder's current
duties, or
<PAGE> 2

2
<PAGE> 3

3
<PAGE> 4

If to J&J, to:

Johnson & Johnson
One Johnson & Johnson Plaza
New Brunswick, NJ 08933
Attention: General Counsel

If to the Stockholder:

Robert P. Padula
161 Twenty-seventh Street, SE
Roanoke, VA 24014

Such address may be changed by notice to the other party as provided
above. Notices given pursuant to this Paragraph shall be deemed effective
upon receipt.

14. Waiver of Jury Trial. Each of the parties hereto hereby
irrevocably waives any and all right to trial by jury in any legal
proceeding arising out of or related to this Agreement.

15. Amendments: No Waiver. (a) No amendment or modification of this
Agreement shall be deemed effective unless made in writing and signed by
the parties hereto.

17. Headings. The headings of paragraphs in this Agreement are
solely for convenience of reference and shall not control the meaning or
interpretation of any provision of this Agreement.

18. Counterparts. This Agreement may be executed in counterparts,
each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.

4
<PAGE> 5

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

ROBERT P. PADULA,

/s/ ROBERT P. PADULA
--------------------------------------
Name: Robert P. Padula

JOHNSON & JOHNSON,

by /s/ ROGER S. FINE
------------------------------------
Name: Roger S. Fine
Title:

<PAGE> 1

EXHIBIT Q

NONCOMPETITION AGREEMENT

THIS NONCOMPETITION AGREEMENT (the "Agreement") is made and entered this
10th day of February 1997, by and between JOHNSON & JOHNSON, a New Jersey
corporation ("J&J"), and HORACE N. HUDSON, an individual (the "Stockholder").

W I T N E S S E T H

WHEREAS, the Stockholder is a stockholder of Innotech, Inc., a Delaware
corporation (the "Company"), and is also a key executive officer of the Company;
and

WHEREAS, following the Merger, J&J intends, or intends to cause Sub, to
continue to conduct and operate the business of the Company; and

NOW, THEREFORE, in consideration of the foregoing and the mutual agreements
hereinafter set forth, the parties hereto agree as follows:

(b) In the event that the Company terminates the Stockholder's
employment without Cause (as defined below), the Company shall (x) continue
to pay such Stockholder through the end of the Noncompetition Period
(payable in accordance with the regular payroll practices of the Company)
an annual amount equal to the salary that the Stockholder was receiving
immediately prior to such termination and (y) continue to provide all
benefits generally available under employee benefit plans or the practices
and policies of the Company at the time of such termination (other than
stock option or similar plans), determined in accordance with the
provisions of such plans, practices and policies. "Cause" shall mean (i)
Stockholder's conviction of, guilty plea to, or confession of guilt of, a
felony, (ii) dishonest or illegal conduct or misconduct or malfeasance by
the Stockholder in the performance of services for or on behalf of the
Company, or other conduct detrimental to the business, operations or
reputation of the Company, regardless of whether such conduct is within the
scope of Stockholder's duty, (iii) failure by the Stockholder to perform
his duties, as assigned to him by the President from time to time, provided
that such duties are not inconsistent with the Stockholder's current
duties, or
<PAGE> 2

2
<PAGE> 3

3
<PAGE> 4

If to J&J, to:

Johnson & Johnson
One Johnson & Johnson Plaza
New Brunswick, NJ 08933
Attention: General Counsel

If to the Stockholder:

Horace N. Hudson
709 Debra Lane
Salem, VA 24153

Such address may be changed by notice to the other party as provided
above. Notices given pursuant to this Paragraph shall be deemed effective
upon receipt.

14. Waiver of Jury Trial. EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL
PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT.

15. Amendments: No Waiver. (a) No amendment or modification of this
Agreement shall be deemed effective unless made in writing and signed by
the parties hereto.

17. Headings. The headings of paragraphs in this Agreement are
solely for convenience of reference and shall not control the meaning or
interpretation of any provision of this Agreement.

18. Counterparts. This Agreement may be executed in counterparts,
each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.

19. Binding Effect; Benefit. This Agreement shall be binding upon
execution and shall become effective when J&J or a subsidiary acquires a
majority of the Shares. This Agreement shall thereafter continue in effect
and shall inure to the benefit of and be binding upon the parties hereto.
Nothing in this Agreement, express or implied, is intended to confer on any
person other than the parties hereto, and their respective successors, any
rights,remedies, obligations or liabilities under or by reason of this
Agreement.

4
<PAGE> 5

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

HORACE N. HUDSON,

/s/ HORACE N. HUDSON

--------------------------------------
Name: Horace N. Hudson

JOHNSON & JOHNSON,

by /s/ ROGER S. FINE

------------------------------------
Name: Roger S. Fine
Title:

<PAGE> 1

EXHIBIT R

NONCOMPETITION AGREEMENT

THIS NONCOMPETITION AGREEMENT (the "Agreement") is made and entered this
10th day of February 1997, by and between JOHNSON & JOHNSON, a New Jersey
corporation ("J&J"), and JO ANN SWASEY, an individual (the "Stockholder").

W I T N E S S E T H

WHEREAS, the Stockholder is a stockholder of Innotech, Inc., a Delaware
corporation (the "Company"), and is also a key executive officer of the Company;
and

WHEREAS, following the Merger, J&J intends, or intends to cause Sub, to
continue to conduct and operate the business of the Company; and

NOW, THEREFORE, in consideration of the foregoing and the mutual agreements
hereinafter set forth, the parties hereto agree as follows:

(b) In the event that the Company terminates the Stockholder's
employment without Cause (as defined below), the Company shall (x) continue
to pay such Stockholder through the end of the Noncompetition Period
(payable in accordance with the regular payroll practices of the Company)
an annual amount equal to the salary that the Stockholder was receiving
immediately prior to such termination and (y) continue to provide all
benefits generally available under employee benefit plans or the practices
and policies of the Company at the time of such termination (other than
stock option or similar plans), determined in accordance with the
provisions of such plans, practices and policies. "Cause" shall mean (i)
Stockholder's conviction of, guilty plea to, or confession of guilt of, a
felony, (ii) dishonest or illegal conduct or misconduct or malfeasance by
the Stockholder in the performance of services for or on behalf of the
Company, or other conduct detrimental to the business, operations or
reputation of the Company, regardless of whether such conduct is within the
scope of Stockholder's duty, (iii) failure by the Stockholder to perform
his duties, as assigned to him by the President from time to time, provided
that such duties are not inconsistent with the Stockholder's current
duties, or
<PAGE> 2

2
<PAGE> 3

3
<PAGE> 4

If to J&J, to:

Johnson & Johnson
One Johnson & Johnson Plaza
New Brunswick, NJ 08933
Attention: General Counsel

If to the Stockholder:

Jo Ann Swasey
1159 Owl Lane
Hardy, VA 24101

Such address may be changed by notice to the other party as provided
above. Notices given pursuant to this Paragraph shall be deemed effective
upon receipt.

14. Waiver of Jury Trial. EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL
PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT.

15. Amendments: No Waiver. (a) No amendment or modification of this
Agreement shall be deemed effective unless made in writing and signed by
the parties hereto.

17. Headings. The headings of paragraphs in this Agreement are
solely for convenience of reference and shall not control the meaning or
interpretation of any provision of this Agreement.

18. Counterparts. This Agreement may be executed in counterparts,
each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.

4
<PAGE> 5

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

JO ANN SWASEY,
/s/ JO ANN SWASEY
--------------------------------------
Name: Jo Ann Swasey

JOHNSON & JOHNSON,

by /s/ ROGER S. FINE
------------------------------------
Name: Roger S. Fine
Title:

<PAGE> 1

EXHIBIT S

NONCOMPETITION AGREEMENT

THIS NONCOMPETITION AGREEMENT (the "Agreement") is made and entered this
10th day of February 1997, by and between JOHNSON & JOHNSON, a New Jersey
corporation ("J&J"), and SUNDER H. MALKANI, an individual (the "Stockholder").

W I T N E S S E T H

WHEREAS, the Stockholder is a stockholder of Innotech, Inc., a Delaware
corporation (the "Company"), and is also a key executive officer of the Company;
and

WHEREAS, following the Merger, J&J intends, or intends to cause Sub, to
continue to conduct and operate the business of the Company; and

NOW, THEREFORE, in consideration of the foregoing and the mutual agreements
hereinafter set forth, the parties hereto agree as follows:

(b) In the event that the Company terminates the Stockholder's
employment without Cause (as defined below), the Company shall (x) continue
to pay such Stockholder through the end of the Noncompetition Period
(payable in accordance with the regular payroll practices of the Company)
an annual amount equal to the salary that the Stockholder was receiving
immediately prior to such termination and (y) continue to provide all
benefits generally available under employee benefit plans or the practices
and policies of the Company at the time of such termination (other than
stock option or similar plans), determined in accordance with the
provisions of such plans, practices and policies. "Cause" shall mean (i)
Stockholder's conviction of, guilty plea to, or confession of guilt of, a
felony, (ii) dishonest or illegal conduct or misconduct or malfeasance by
the Stockholder in the performance of services for or on behalf of the
Company, or other conduct detrimental to the business, operations or
reputation of the Company, regardless of whether such conduct is within the
scope of Stockholder's duty, (iii) failure by the Stockholder to perform
his duties, as assigned to him by the President from time to time, provided
that such duties are not inconsistent with the Stockholder's current
duties, or
<PAGE> 2

2
<PAGE> 3

3
<PAGE> 4

If to J&J, to:

Johnson & Johnson
One Johnson & Johnson Plaza
New Brunswick, NJ 08933
Attention: General Counsel

If to the Stockholder:

Sunder H. Malkani

Such address may be changed by notice to the other party as provided
above. Notices given pursuant to this Paragraph shall be deemed effective
upon receipt.

14. Waiver of Jury Trial. EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL
PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT.

15. Amendments: No Waiver. (a) No amendment or modification of this
Agreement shall be deemed effective unless made in writing and signed by
the parties hereto.

17. Headings. The headings of paragraphs in this Agreement are
solely for convenience of reference and shall not control the meaning or
interpretation of any provision of this Agreement.

18. Counterparts. This Agreement may be executed in counterparts,
each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.

4
<PAGE> 5

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

SUNDER H. MALKANI,
/s/ SUNDER H. MALKANI

--------------------------------------
Name: Sunder H. Malkani

JOHNSON & JOHNSON,

by /s/ ROGER S. FINE

------------------------------------
Name: Roger S. Fine
Title: