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<SEC-DOCUMENT>0001141218-03-000160.txt : 20031105
<SEC-HEADER>0001141218-03-000160.hdr.sgml : 20031105
<ACCEPTANCE-DATETIME>20031105163700
ACCESSION NUMBER:		0001141218-03-000160
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		3
CONFORMED PERIOD OF REPORT:	20031030
ITEM INFORMATION:		
ITEM INFORMATION:		Financial statements and exhibits
FILED AS OF DATE:		20031105

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			STAAR SURGICAL COMPANY
		CENTRAL INDEX KEY:			0000718937
		STANDARD INDUSTRIAL CLASSIFICATION:	OPHTHALMIC GOODS [3851]
		IRS NUMBER:				953797439
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			0101

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-11634
		FILM NUMBER:		03979857

	BUSINESS ADDRESS:	
		STREET 1:		1911 WALKER AVE
		CITY:			MONROVIA
		STATE:			CA
		ZIP:			91016
		BUSINESS PHONE:		8183037902

	MAIL ADDRESS:	
		STREET 1:		1911 WALKER AVE
		CITY:			MONROVIA
		STATE:			CA
		ZIP:			91016
</SEC-HEADER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>staar1030038k.txt
<DESCRIPTION>CURRENT REPORT ON FORM 8-K
<TEXT>
                                UNITED STATES
                      SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C. 20549

                                   FORM 8-K

                                CURRENT REPORT
    Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

      Date of Report (Date of earliest event reported): October 30, 2003

                            STAAR SURGICAL COMPANY
            (Exact name of registrant as specified in its charter)

              Delaware                0-11634                    95-3797439
 (State or other jurisdiction) (Commission File Number)       (I.R.S. Employer
of incorporation or organization)                            Identification No.)


         1911 Walker Avenue, Monrovia, California               91016
         (Address of principal executive offices)            (Zip Code)

                                (626) 303-7902
             (Registrant's telephone number, including area code)


<PAGE>


Item 7.  Financial Statements and Exhibits.

      (c) Exhibits

Exhibit Number    Description
- --------------    -----------

     99.1         Press Release dated October 30, 2003.

     99.2         Transcript of presentation given by David Bailey and John Bily
                  at a conference call conducted by STAAR Surgical Company on
                  October 30, 2003.

Item 12.  Results of Operations and Financial Condition.

        On October 30,  2003,  STAAR  Surgical  Company  issued a press  release
announcing  financial  results for the third  fiscal  quarter of 2003. A copy is
attached  as  Exhibit  99.1 to this  report and is  incorporated  herein by this
reference.

        On October 30, 2003, STAAR Surgical Company held an earnings  conference
call to discuss the  financial  results for the third fiscal  quarter of 2003. A
transcript of the  presentation  given by David Bailey and John Bily in the call
is attached to this report as Exhibit  99.2 and is  incorporated  herein by this
reference.

        The  information  in this  Current  Report  on Form 8-K,  including  the
exhibits,  will not be treated as "filed" for the  purposes of Section 18 of the
Securities Exchange Act of 1934 (the "Exchange Act") or otherwise subject to the
liabilities  of that  section.  This  information  will not be  incorporated  by
reference into a filing under the Securities Act of 1933, or into another filing
under the  Exchange  Act,  unless  that  filing  expressly  refers  to  specific
information in this report.


                                      -2-
<PAGE>


                                  SIGNATURES

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


Date:  November 5, 2003                 STAAR SURGICAL COMPANY

                                        By: /s/ John Bily
                                            ___________________
                                            John Bily
                                            Chief Financial Officer






                                      -3-
<PAGE>


                                Exhibit Index

EXHIBIT NUMBER    DESCRIPTION
- --------------    -----------

     99.1         Press Release dated October 30, 2003.
     99.2         Transcript of presentation given by David Bailey and John Bily
                  at a conference call conducted by STAAR Surgical Company on
                  October 30, 2003.








                                      -4-

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99
<SEQUENCE>3
<FILENAME>staar1030038kex991.txt
<DESCRIPTION>PRESS RELEASE
<TEXT>


                                                                 Exhibit 99.1
                                                                 ------------

Press Release                                  Source: STAAR Surgical Company

              STAAR Surgical Reports Third Quarter 2003 Results

      Thursday October 30, 4:20 pm ET

      U.S. Sales Up 5% in Third Quarter

      Specialty Lens Sales Grew 22%

      ICL Unit Sales Up 15%

      Company Records a $2.1 Million Write-Down of Patents and Reverses $1.7
      Million of Reserves Against Former Officer's Notes

      SEC Review of STAAR Financials Completed

MONROVIA,  Calif.,  Oct. 30 -- STAAR Surgical Company  (Nasdaq:  STAA - News), a
leading developer,  manufacturer and marketer of minimally  invasive  ophthalmic
products,  today announced  financial  results for its third quarter which ended
October 3, 2003.

Total product sales for the quarter were $11,927,000 up 7.6% from the comparable
period one year ago. Excluding the impact of changes in currency exchange rates,
product sales were up 2% from the comparable  period one year ago. Total revenue
for the quarter was also  $11,927,000 up 6.5% from  $11,201,000  reported in the
same  period one year ago.  Last year's  difference  between  total  revenue and
product  sales was the result of royalties  previously  generated by  technology
licenses that terminated as of March 31, 2003.

During the  quarter,  the Company  wrote down $2.1  million  (net book value) in
capitalized  patent costs in  connection  with its routine  evaluation of patent
costs in accordance  with  Statement of Financial  Accounting  Standards No. 144
(SFAS 144) -- Accounting for the Impairment of Long-Lived Assets. The write-down
related to patents acquired in the purchase of its majority  interest in Circuit
Tree Medical,  a developer and  manufacturer of  phacoemulsification  equipment,
whose  ongoing  operations  were moved to the  Company's  Monrovia,  CA facility
during the  quarter.  STAAR  acquired  the  interest in Circuit  Tree Medical in
December 1999.  The $2.1 million charge was partially  offset by the reversal of
$1.7 million of reserves  against former  officer's notes which were paid during
the quarter resulting in net charges of $400,000.

Gross margins were 55.2% which  compared very  favorably with the 50.2% reported
in the same period one year ago.  Comparable  operating expenses  (excluding the
previously  disclosed  net charge of $400,000  in the third  quarter of 2003 and
$230,000 in employee  separation  costs  incurred in the third  quarter of 2002)
increased to $8,695,000,  or 23%, compared with the same period one year ago and
reflect a 32% increase in spending for research and  development  activities  as
well a 26% increase in marketing and selling expenses. The increased spending in
research  and  development  related to  increased  headcount,  new and  existing
product  development,  and costs  associated  with the U.S. FDA panel meeting to


<PAGE>

review the  ICL(R) and the  potential  upcoming  launch of the  product in early
2004.  The  increased  spending  in  marketing  and  selling  was the  result of
increased  salaries and travel,  one-time  employee  relocation costs, a loss on
disposal of a trade show booth and  consulting  and  promotional  activities  in
preparation  for the potential  launch of the ICL. "To help offset this increase
in  expenditure  we  continue  to  rigorously   streamline  our  U.S.  operating
infrastructure.  The integration of our phacoemulsification  business at Circuit
Tree Medical will provide  substantial  annual  savings to  counterbalance  this
planned increase in sales and marketing expenses," said David Bailey,  President
and CEO of STAAR Surgical.

General  and  administrative  expenses  were up 11% in the  quarter  from  third
quarter  2002  levels  primarily  as a result  of an  increase  in  professional
services  expenditures  for the SEC inquiry the Company  made during the quarter
related to its accounting for former officer's notes.

Net loss for the  quarter  was  $2,710,000,  or $0.15  per  share.  This  result
includes the net charge of $400,000  recorded during the quarter.  Excluding the
net  charge,  net loss per share for the  quarter  would have been  $0.13.  This
compares  with a net loss of $2,144,000  million,  or $0.12 per share during the
same period one year ago.  Excluding the $230,000 charge the Company took in the
third quarter of 2002 in conjunction with employee separation,  net loss for the
third quarter of 2002 would have been $1,914,000 or $0.11 per share.

"During the third  quarter,  we began to achieve our goal of turning  around the
U.S. base cataract business," continued Mr. Bailey. "Total U.S. sales were up 5%
from the third quarter of last year. This  performance was led by a 28% increase
in Collamer(R) lens sales, where growth has continued to accelerate.  Toric lens
sales also continued to gain momentum and were up 10% during the quarter.

"In our  international  business,  sales were flat  compared to the same quarter
last year when  excluding  the impact of exchange.  This  reflects a higher than
normal impact from the seasonality we expect in Europe during the summer months.
Despite  this,  international  ICL unit sales  increased  by 15% versus the same
quarter last year, led by growth in selected international geographies including
Australia.  International  revenue  represents  53% of our total revenue for the
first nine months of the year," continued Mr. Bailey.

For the nine-month  period ended October 3, 2003, total sales were  $37,656,000,
up 8.4% from the comparable  nine-month period of 2002.  Excluding the impact of
exchange,  sales were up 0.5% to the comparable nine-month period of 2002. Total
revenues for the same  nine-month  period of 2003  increased  7.7% from the same
period of 2002.  Net loss per share for the  nine-month  period ended October 3,
2003 was $0.28, compared with a net loss of $0.41 per share reported during same
period for last year. Without the net charge taken during the quarter,  net loss
for the first  nine  months of 2003  would have been  $0.25.  Without  the costs
related to employee  separation and a one-time income tax benefit,  net loss for
the first nine months of 2002 would have been a loss of $0.38 per share.

"We also achieved our goal of appearing before the FDA Ophthalmic  Devices panel
on October 3, 2003. Obviously,  we are delighted with the panel's recommendation
to approve the ICL for  commercialization in the U.S. for the full diopter range
requested in our PMA," Mr. Bailey  continued.  "Although the FDA is not bound by
its decision,  we believe that the panel's  exhaustive review of the ICL and the


<PAGE>

subsequent  vote of confidence are important steps in the approval  process.  We
believe we remain on track to  commercialize  the ICL in the U.S.  during  early
2004.  Our  technology is extremely  complementary  to existing  treatments  for
near-sightedness  and in cases  involving  extremely  high levels of myopia will
offer the only treatment available.

"With potential FDA approval pending,  we are also beginning to see the build-up
of interest from U.S. doctors," Mr. Bailey continued.  "This is further evidence
of the  critical  scientific  and medical  mindshare  that the ICL  continues to
garner. As evidenced by the increase in marketing and selling  expenses,  we are
strategically  preparing for an early 2004 commercial launch. There is clearly a
significant  potential  market  opportunity  for the  ICL.  We  intend  to fully
capitalize on this opportunity by carefully  planning and effectively  executing
in the U.S. market. The entire STAAR team is committed to this goal.

"More than 300 doctors  have  already  signed up for a symposium at the upcoming
AAO conference in Anaheim in November  designed to educate doctors about the use
of phakic  IOLs like our ICL as a  compliment  to corneal  refractive  surgery,"
continued Mr. Bailey.  "We will have a major presence at the conference and have
planned a variety of  presentations  during the  meeting  that will span  topics
ranging from the  biocompatibility  of our patented Collamer material to insight
on how doctors can achieve successful results in the implantation of the ICL."

SEC Review of Financials Completed

During the quarter,  STAAR  initiated  discussions  with the Office of the Chief
Accountant  of the SEC regarding  STAAR's  historical  method of accounting  for
promissory  notes received from former officers and directors in connection with
the  exercise of stock  options.  On October 29,  2003,  the Office of the Chief
Accountant advised STAAR that determining the appropriate  accounting  treatment
is highly  dependent on the specific  facts and  circumstances,  and rather than
express a view on how STAAR accounted for these transactions, advised STAAR that
management and its auditors  should  carefully  evaluate the attendant facts and
circumstances,  together with all relevant audit  evidence in assessing  whether
STAAR  applied the proper  accounting  treatment.  STAAR and its  auditors,  BDO
Seidman,  LLP,  have  thoroughly  reviewed  the facts and  circumstances  of the
officers' and directors'  promissory  notes and have  determined  that the notes
were accounted for appropriately  except with regard to interest income as noted
below  and no other  adjustments  to  historical  financial  statements  will be
required.

During the course of these  discussions with the SEC, it was noted that interest
income on the notes was being recorded on a cash basis rather than on an accrual
basis required by Generally Accepted  Accounting  Principles (GAAP). The Company
has determined that this is an accounting  error which will require  restatement
of its financial  statements for the years ended December 29, 2000, December 28,
2001, and January 3, 2003, the first quarter ended April 4, 2003, and the second
quarter ended July 4, 2003 by increasing  (decreasing) other income (expense) by
($280,967), ($161,479), $225,595, ($211,065), and ($53,104), respectively.

STAAR exited the third  quarter with  approximately  $9,861,000 in cash and cash
equivalents  on its balance  sheet  compared  with  $1,009,000 at the end of the
fourth  quarter of 2002.  STAAR had  $3,257,000  in debt at the end of the third
quarter of 2003.

<PAGE>

Looking ahead,  Mr. Bailey offered this outlook for the full year 2003. "For the
full year we believe that we will  generate  single digit sales growth  overall,
with the U.S. market continuing to grow during the fourth quarter. This positive
trend in the U.S. will continue to help drive gross margin.  We will continue to
allocate  an  appropriate  portion  of our R&D  budget to  further  develop  new
injector  systems  and build a true core  competence  within  STAAR  Surgical to
complement  our implant  technology.  This will have a lasting impact on implant
sales going forward.  As we continue to ramp up sales and marketing expenses for
the U.S. ICL launch, we will remain focused on containing other expenses.  Given
all that is  happening  with the ICL we  believe  that we will  reach  operating
profitability  during the second half of next year,  assuming an early 2004 U.S.
launch of the ICL."

Use of Non-GAAP Measures

The Company believes that non-GAAP measures of earnings per share before charges
associated  with the write-down of patents  partially  offset by the reversal of
reserves on officer's notes,  before charges associated with employee separation
and before the impact of a tax benefit are  appropriate  measures for evaluating
the operating  performance of the Company.  The Company  believes that providing
these measures  without regard to the charge taken in the third quarter of 2003,
the charges associated with employee separation and subsidiary closures taken in
2002 and  excluding  the impact of an income tax benefit in the third quarter of
2002,  will allow  investors and others to more  thoroughly  evaluate  operating
results and in turn, allow them to judge the Company's operating progress.

Conference Call

The Company will host a conference  call and webcast today,  October 30, 2003 at
4:30 p.m.  EST to discuss  the  Company's  third  quarter  results  and  current
corporate   developments.   The  dial-in  number  for  the  conference  call  is
800-240-4186  for  domestic  participants  and  303-262-2050  for  international
participants.

A  taped  replay  of the  conference  call  will  also  be  available  beginning
approximately  one hour after the call's  conclusion  and will remain  available
through  9:00 p.m.  EST on  Saturday,  November  1, 2003 and can be  accessed by
dialing  800-405-2236 for domestic  callers and  303-590-3000 for  international
callers,  using passcode 555304#.  To access the live webcast of the call, go to
STAAR  Surgical's  website at  www.staar.com.  An archived  webcast will also be
available at www.staar.com

About STAAR Surgical

STAAR  Surgical is a leader in the  development,  manufacture  and  marketing of
minimally  invasive  ophthalmic  products  employing  proprietary  technologies.
STAAR's products are used by ophthalmic  surgeons and include the  revolutionary
Implantable  Contact Lens(TM) as well as innovative products designed to improve
patient  outcomes  for  cataracts  and  glaucoma.  STAAR's  ICL has  received CE
Marking,  is approved  for sale in 37 countries  and has been  implanted in more
than 30,000 eyes worldwide.

<PAGE>

Safe Harbor

All statements in this press release that are not statements of historical  fact
are forward-looking statements,  including any projections of earnings, revenue,
or  other  financial  items,  any  statements  of  the  plans,  strategies,  and
objectives  of  management  for future  operations,  any  statements  concerning
proposed new  products  and  government  approval of new  products,  services or
developments,   any  statements   regarding   future   economic   conditions  or
performance,  statements of belief and any statements of assumptions  underlying
any of the foregoing. These statements are based on expectations and assumptions
as of the date of this  press  release  and are  subject to  numerous  risks and
uncertainties,  which could cause actual results to differ materially from those
described in the forward-looking statements. The risks and uncertainties include
the need to obtain  regulatory  approval  for new  products,  acceptance  of new
products by medical practitioners and consumers, the rapid pace of technological
change in the ophthalmic industry,  general domestic and international  economic
conditions,  and other  factors  beyond the control of STAAR  Surgical  Company,
including those detailed from time to time in STAAR Surgical  Company's  reports
filed with the  Securities  and  Exchange  Commission.  STAAR  Surgical  Company
assumes no obligation to update these forward-looking statements and does intend
to do so.

    CONTACT:   Investors                          Media
               EVC Group                          EVC Group
               Douglas Sherk, 415-896-6820        Sheryl Seapy, 415-272-3323
               Jennifer Cohn, 415-896-6820

<PAGE>

                            STAAR Surgical Company
                 Condensed Consolidated Statements of Income
                     (In 000's except for per share data)
                                  Unaudited


                             Three Months Ended           Nine Months Ended

                          October 3,   September 27, October 3,  September 27,
                            2003           2002         2003           2002

    Sales                  $11,927       $11,085      $37,656       $34,725
    Royalties                    0           116           48           295
        Total revenues      11,927        11,201       37,704        35,020

        Total cost of
         goods sold          5,340         5,580       17,082        17,664

    Gross profit             6,587         5,621       20,622        17,356

      General and
       administrative        2,324         2,086        6,829         6,786
      Marketing and
       selling               5,048         4,000       13,629        12,502
      Research and
       development           1,323         1,002        3,874         3,055
      Other charges            390           230          390         1,455
        Total selling,
         general and
         administrative
         expenses:           9,085         7,318       24,722        23,798

    Operating loss          (2,498)       (1,697)      (4,100)       (6,442)

    Total other income
     (expense)                  27          (155)         188          (849)

    Loss before
     income taxes           (2,471)       (1,852)      (3,912)       (7,291)

    Income tax
     provision (benefit)       215           222          859          (406)

    Minority interest           24            70           66           165

    Net loss               ($2,710)      ($2,144)     ($4,837)      ($7,050)


    Net loss
     per share              ($0.15)       ($0.12)       ($0.28)      ($0.41)


    Weighted average
     shares outstanding     18,281        17,182       17,504        17,168


    Proforma Loss Per Share
    Net loss
     per share            $(2,710)      $(2,144)     $(4,837)      $(7,050)

    Other charges              390           230          390         1,455
    Income tax benefit          --            --           --         (958)

    Proforma loss
     per share             $(2,320)      $(1,914)     $(4,447)      $(6,553)

    Proforma net
     loss per share         $(0.13)       $(0.11)       $(0.25)      $(0.38)



</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99
<SEQUENCE>4
<FILENAME>staar1030038kex992.txt
<DESCRIPTION>CONFERENCE CALL TRANSCRIPT
<TEXT>
                                                                    Exhibit 99.2
                                                                    ------------

                                                                STAAR SURGICAL
                                                        Moderator:  Doug Sherk
                                                           10-30-03/3:30 pm CT
                                                          Confirmation #555304
                                                                        Page 1






                                STAAR SURGICAL

                            Moderator: Doug Sherk
                               October 30, 2003
                                  3:30 pm CT


Operator:      Good afternoon,  ladies and gentlemen, and welcome to the STAAR
               Surgical Third Quarter 2003 Results conference call.

               At  this  time  all  participants  are in a  listen-only  mode.
               Following today's  presentation  instructions will be given for
               the question  and answer  session.  If anyone needs  assistance
               at any  time  during  the  conference,  please  press  the Star
               followed by the 0.

               As a reminder,  this  conference is being recorded on Thursday,
               October 30, 2003.

               I would now like to turn the conference  over to Mr. Doug Sherk
               of EVC Group.  Please go ahead, sir.

Doug Sherk:    Thank you, operator,  and good afternoon,  everyone.  Thank you
               for  joining  us  this   afternoon   for  the  STAAR   Surgical
               conference  call to review the financial  results for the third
               quarter ended October 3, 2003.

<PAGE>
                                                                STAAR SURGICAL
                                                        Moderator:  Doug Sherk
                                                           10-30-03/3:30 pm CT
                                                          Confirmation #555304
                                                                        Page 2

               The news release  reviewing the third quarter  results  crossed
               the wire  about  15  minutes  ago,  and we  apologize  for this
               delay,  which  was  brought  on by the late  resolution  of the
               previously  discussed SEC review and STAAR's  desire to discuss
               this  resolution  this  afternoon.  If you  haven't  received a
               copy of the  release  and  would  like  one,  you can  call our
               office  at   415-896-6820,   and  we'll  get  one  out  to  you
               immediately.

               Additionally,  we  have  arranged  for a taped  replay  of this
               call,  which may be  accessed  by phone.  This replay will take
               effect  approximately  one hour after the call's conclusion and
               remain in effect through  tomorrow night,  Saturday - excuse me
               - yeah,  Saturday  night,  November  1 at  11:59  p.m.  Pacific
               Time.   The   dial-in   number   to   access   the   replay  is
               800-405-2236,  or for international callers 303-590-3000.  Both
               need to use the pass code 555304#.

               In  addition  this  call  is  being  broadcast  lived  with  an
               archived  replay  also  available.  To access  the web cast for
               the STAAR's Website at  www.staar.com.  The web cast archive of
               the call will be  available  until  the  company  releases  its
               final year results for 2003 some time in late February.

               Before we get  started,  during the  course of this  conference
               call   the   company   will   make    projections    or   other
               forward-looking  statements  regarding  future events including
               statements about its domestic sales, the planned  submission of
               its FDA filling for implantable  contact lenses,  the company's
               beliefs  about  its  revenues  and  earnings  for the full year
               ending  January  2,  2004.  We wish to  caution  you that  such
               statements  are  just   predictions  and  involve  results  and
               uncertainties.  Actual results may differ materially.

               Factors  that  affect  actual   results  are  detailed  in  the
               company's  filings  with  the SEC  including  its  most  recent
               filing of the Form  10-Q and  10-K.  In  addition  the  factors
               underlying  the company's  forecasts are dynamic and subject to
<PAGE>
                                                                STAAR SURGICAL
                                                        Moderator:  Doug Sherk
                                                           10-30-03/3:30 pm CT
                                                          Confirmation #555304
                                                                        Page 3

               change and,  therefore,  the  forecasts are to be assumed to be
               realistic  only as of the date  they  are  given.  The  company
               doesn't undertake to update them;  however,  they may choose to
               do so from  time to time.  And  should  they do so,  they  will
               submit the updates to the investing public.

               Now I'd like to turn the call over to David  Bailey,  President
               and Chief Executive Officer of STAAR Surgical  Company,  who is
               suffering from a very heavy head cold today.

David Bailey:  Thanks,  Doug,  and good  afternoon,  everyone.  Thank  you for
               joining  us for the STAAR  Surgical  Third  Quarter  conference
               call.

               With me  today  is John  Bily,  our  Chief  Financial  Officer,
               (Deborah   Andrews),   our  Global   Controller,   and  (Helene
               Lamielle), our Chief Scientific Officer.

               Today I'm  going to start  off the call  with a quick  recap of
               our third quarter  results and update you on the progress we've
               made in various  product  segments.  John will then  review our
               financial  performance  including  yesterday's  SEC advisement.
               We will then open up the floor for questions.

               Before  I begin  we  would  like  to  acknowledge  the  lack of
               balance sheet  highlights  in the news  release.  Given the SEC
               advisement  yesterday  and the  need  to  slightly  adjust  our
               financial  statement,  we will be delaying the  distribution of
               the  third  quarter  balance  sheet   highlights.   John  will,
               however,  review some of the  highlights  later in the call. As
               soon as these are fully finalized we'll then distribute them.

               Now  let's  turn to the  quarter  where  the  more  significant
               component  of  our  financial  performance  was  certainly  the
               progress we made in the US,  which had sales  growth of 5% of a
               quarter  and  almost  flat  sequentially  despite  seasonality.

<PAGE>
                                                                STAAR SURGICAL
                                                        Moderator:  Doug Sherk
                                                           10-30-03/3:30 pm CT
                                                          Confirmation #555304
                                                                        Page 4

               This compares  extremely  favorable to the comparisons from the
               last three  quarters.  Quarter two was down 3%, quarter one was
               down  6%,   and   quarter   four  of  2002  was  down  11%  all
               year-over-year.  We are pleased with the  progress  that we are
               making in the US and that we're  delivering  on our  commitment
               to shareholders to reverse the decline in the US business.

               Our net loss  increased  year-over-year  to  roughly 15 cents a
               share and largely  reflects the non-cash charge that we took to
               write  down   patents   associated   with  the   Circuit   Tree
               acquisition  and the  reversal  of  reserves  we  took  against
               Officer's  notes.  Without  this charge our net loss would have
               been 13 cents per share.

               During the quarter  international  sales were  relatively  flat
               compared  with  the  third  quarter  of '02.  However,  for the
               first nine months of 2003 international  sales have grown 18.9%
               versus the same period of last year and  represents  53% of our
               total  revenues.  As a  reminder,  international  sales were up
               very  strongly  in the  first  half of this year  largely  as a
               result of ICL sales, which were up 20% in the first half.

               The  slowdown  in  international  sales was  reflective  of the
               normal  seasonal  slowdown  in  surgery  in Europe we see every
               year.  This year,  however,  the slowdown  was more  protracted
               than normal.  In addition,  we have seen a slowdown in elective
               surgery  procedures  including Lasik in Korea, which we believe
               is  reflective  of the  political  and economic  turmoil in the
               first half in that country.

               We believe  that we are  beginning  to see renewed  strength in
               international  sales,  which  rebounded  during  the  month  of
               September.  In fact,  we  recorded a 28%  increase in ICL units
               sold  during  the month  with  Toric  ICL  sales in  particular
<PAGE>
                                                                STAAR SURGICAL
                                                        Moderator:  Doug Sherk
                                                           10-30-03/3:30 pm CT
                                                          Confirmation #555304
                                                                        Page 5

               gaining  traction.  We also regard the pending approvals of the
               ICL  in  Taiwan  and   Australia   as  potential  up  sides  to
               international revenues.

               On  the  cataract  side  of  the  business  we  recently  began
               shipment of the world's first  pre-loaded  silicon  intraocular
               lens that has been  developed  by our joint  venture with Canon
               in  Japan.  We  obtained  CE mark  approval  for  this in early
               October  and   invoiced   our  first  sale  last  week.   Early
               indications are that market  acceptance of this unique cataract
               device will be very high.

               As  you  know,  our  US  operating  cost  structure  is  highly
               leveraged.  And with the  increase  in US sales we were able to
               increase  our gross  profit  margins for the sixth  consecutive
               quarter to 55.2%.

               We   continue   to  focus   on   creating   greater   operating
               efficiencies  internationally.   We  were  able  to  raise  our
               international  gross  margins by 3.4% from the third quarter of
               2002.  John will comment on that in a little bit more detail.

               Despite  the  depressing  effect  on  sales of  unusually  high
               European  seasonality,  I was delighted with the turn around in
               the US business  that has occurred  during  quarter  three.  We
               have  committed  to  shareholders  to halt the  decline in this
               high  margin  business  in the  second six months of this year.
               And we've done exactly this.

               We saw growth of 22% in the high  margin  specialty  lenses for
               the third quarter  accelerating  the growth we saw in the first
               half. Our marketing  efforts  around the Collamer  material are
               helping  to  generate  an  accelerating  sales  trend  for this
               product  category  despite  the fact we have  yet to bring  the
               three-piece  lens to market  effectively  due to the lack of an
               effective injection system.
<PAGE>
                                                                STAAR SURGICAL
                                                        Moderator:  Doug Sherk
                                                           10-30-03/3:30 pm CT
                                                          Confirmation #555304
                                                                        Page 6

               Unfortunately,  we now do not  believe  that  the new  injector
               systems  in the  three-piece  Collamer  lens will be  perfected
               prior  to the end of the  year.  And we  realize  that we won't
               make the timeline that we previously outlined for investors.

               As  we  have  indicated  previously,  we  have  identified  the
               challenges  and are working  diligently to address  them.  This
               process  is taking  longer  than we  expected.  But we  believe
               we'll  be able to  deliver  a new  state  of the art  injection
               system by the end of the first quarter of '04.

               Given this delay,  we will  continue to put all efforts  behind
               the  one-piece  Collamer.   And  as  a  result,  we  anticipate
               continued  growth of this  segment and have  already  increased
               capacity in our Swiss manufacturing  facility where we make the
               lens.  With the change in mix from  silicon to  Collamer  plate
               and other  specialty  lenses  increasing,  we are seeing a very
               healthy  trend in our average lens selling  price within the US
               market.

               Growth in the US  underscores  an  acceleration  of our  future
               potential  profit  goal.  The  healthy  return of our  US-based
               business  provides  an  excellent  platform  for the  potential
               launch  of the ICL in the US. I would  repeat,  we have now had
               six sequential  quarters of gross margin  improvement and fully
               expect this to continue going forward.  We are seeing  surgeons
               who  are  interested  in  the  ICL  being   interested  in  the
               one-piece  Collamer IOL and wanting to get experience  with the
               material.

               I'd now like to  provide  you with an  update  on all  activity
               surrounding  the potential FDA approval and subsequent  launch.
               Firstly  regarding  the  FDA,  as  you  know,  we  had  a  very
               successful  panel  meeting  with  the FDA on  October  the 3rd,
               2003.  At the  conclusion  of the  meeting the CDRH Panel voted
<PAGE>
                                                                STAAR SURGICAL
                                                        Moderator:  Doug Sherk
                                                           10-30-03/3:30 pm CT
                                                          Confirmation #555304
                                                                        Page 7

               to approve the ICL with  conditions.  We regard the 8 to 3 vote
               for  approval  as  a  tremendous  vote  of  confidence  in  our
               technology.

               I would  remind  you,  as  well,  that we have  completed  this
               entire   process   from   filing   to  panel   meeting   on  an
               unprecedented  timeline.  If you recall,  it was in May that we
               filed the  original  PMA.  We were then  granted  an  expedited
               review in June and were  recommended  for  approval  during the
               first week of October.

               After the panel  vote the next step was to wait for  receipt of
               the  full  transcript  of  the  panel  meeting.   This  is  now
               available.  At this point we have been  advised that the review
               team  at  the  FDA  is  in  the  process  of  making   labeling
               recommendations  and will be meeting  internally to provide for
               the company their view of the labeling requirements.

               We have been given no formal  timeline as to when these  formal
               labeling   recommendations   will  be  presented.   We  assume,
               however,  that this will be in line with  other  aspects of the
               review,  i.e.,  expedited.  With  this  in  mind  we  have  had
               communication   with  the  FDA  since  the  panel  meeting  and
               continue  to  follow  up  and  feel   confident  that  labeling
               discussions will begin shortly.

               Secondly,  I'd like to give you a brief update on the marketing
               and  sales  ramp  up for  the  ICL.  We  continue  to  generate
               tremendous   mind  share  with  the   scientific   and  medical
               community  with  regard  to  this  product.   As  part  of  our
               marketing  plan,  we will  host a  revamped  new  booth  at the
               upcoming  AAO  meeting.  We will use it to debut  our new brand
               name  for  the  ICL as well  as  focusing  on the new  Collamer
               position that is driving the sales growth that we're seeing.
<PAGE>
                                                                STAAR SURGICAL
                                                        Moderator:  Doug Sherk
                                                           10-30-03/3:30 pm CT
                                                          Confirmation #555304
                                                                        Page 8

               There  are more  than 15  dynamic  lectures  scheduled  for the
               booth  including  discussing the  three-year  results of the US
               FDA  clinical  trial for the ICL. In  addition,  lectures  will
               cover Collamer  biocompatibility  and  importantly  the interim
               results of the US FDA  clinical  trial for the Toric  ICL,  the
               next generation product.

               During  the  conference  there  will  also  be a CME  sponsored
               educational course on Sunday morning to teach  ophthalmologists
               about our Phakic  refractive  lens.  World-renown  doctors will
               discuss the nuances of our new  technology and comment on cases
               studies  that  will be  presented.  At last  count  there  were
               already more than 400 US doctors  signed up for the course.  At
               this  stage we are only  registering  doctors  for the  course.
               The  organizer's  considering a move to a larger room that will
               accommodate an audience of at least 500.

               We regard  this  interest  as not  unexpected  for a first of a
               kind  technology,  which we have with the ICL, and we see it as
               being in line with the  interest  being  expressed in attending
               an  ICL   training   course   post  FDA   approval.   For  more
               information  on this event you may visit the OSN Website online
               at www.osnsupersite.com.

               Finally,  regarding  upcoming  marketing  and launch events for
               the ICL, I'd like to give you a quick  synopsis of our progress
               in  establishing  our  certification  program.  There  are  two
               elements to  certifying  a doctor to implant the ICL. The first
               step is a doctor  paid  training  course that  typically  lasts
               between  one and two days.  These  training  courses  are being
               structured  to have no  negative  impact  on our  P&L.  And our
               experience  overseas  gives us  absolute  confidence  that this
               will  be  the  same  in the  US.  The  plan  is to  hold  these
               training courses throughout 2004.
<PAGE>
                                                                STAAR SURGICAL
                                                        Moderator:  Doug Sherk
                                                           10-30-03/3:30 pm CT
                                                          Confirmation #555304
                                                                        Page 9

               The second step in  certification  is the  proctoring  process.
               The cost of this step has been  factored into our ICL marketing
               budget that we have  previously  outlined  as $1.1  million for
               2003 and $2.5 million for 2004.  We have already  recruited six
               highly  qualified   professionals  as  proctors  along  with  a
               director of education  for the whole ICL  program.  Our goal is
               to  increase  to eight  proctors  at launch.  This  recruitment
               process has been very  efficient as we have had an abundance of
               interest from very well qualified candidates.

               Before  doctors are  certified to perform ICL surgery they will
               have to complete a minimum of four supervised  procedures using
               STAAR  lenses.   These  lenses  must  be  purchased   from  the
               company.  These  procedures  will  typically  take place in one
               day  after  which  the  surgeon,  assuming  he or she  achieves
               certification status, will be free to purchase the ICL.

               We  believe  that  this  two-step   process  will  provide  the
               training  necessary  for ocular  surgeons to become  skilled at
               ICL  implantation.  Our greatest  concern is to ensure that the
               learning   curve   of   the   involved   doctors   is   handled
               appropriately  so that the  introduction  of the  product  will
               proceed  without  any  problems.  This is the same  process  we
               have established in new markets,  such as Korea and Canada, and
               which has worked so well to deliver quality outcomes.

               We have also planned to use our existing  sales force to market
               this product.  Their efforts will be directed  within a clearly
               defined  and  orchestrated  internal  marketing  program.  As a
               result,  we believe this  product  will be highly  leveraged on
               the  existing  structure.  Our current  sales force are already
               visiting  many  of the  target  ICL  doctors.  The  incremental
               sales and marketing  expense is clearly  defined and adequately
               accounted for within the incremental $2.5 million.
<PAGE>
                                                                STAAR SURGICAL
                                                        Moderator:  Doug Sherk
                                                           10-30-03/3:30 pm CT
                                                          Confirmation #555304
                                                                       Page 10

               With all of this  activity  around the ICL I can tell you quite
               clearly  that,  as a  company,  we feel very  comfortable  with
               analysts'  current  projections  for ICL  sales  next  year and
               continue  to believe  that the  absolute  market for the Phakic
               lens  implant  within  the US will  match or indeed  exceed the
               highest analysts' projections currently offered.

               This  quarter was  obviously a very busy one. We believe we are
               solidly  on  track  to  achieve  our  long-term  goals.  We are
               pleased  with the  turnaround  that is  developing  in our base
               business  as  well  as  the  speed  at  which  we  have  passed
               significant ICL milestones.

               At this  time  I'm  going  to hand  over to John to  recap in a
               little more detail the financials.

John Bily:     Thank you, David.

               The  overall  financial  and  operational  fundamentals  of the
               business   continue   to  improve   year-over-year.   As  David
               mentioned,   gross  profit  margins   improved  for  the  sixth
               consecutive quarter.

               STAAR continues to fund and to grow its R&D investment.

               Interest  expense  and debt  have been  significantly  reduced.
               Working capital management remains a company focus.
               Manufacturing  costs have been  favorably  impacted by rigorous
               expense  control  and yield  and  efficiency  improvement.  The
               company today has nearly $10 million in cash.

               I'll briefly recap Q3 and year-to-date  financial results.  Net
               sales for the third quarter were $11.927 million,  up 7.6% over
               prior year quarter.
<PAGE>
                                                                STAAR SURGICAL
                                                        Moderator:  Doug Sherk
                                                           10-30-03/3:30 pm CT
                                                          Confirmation #555304
                                                                       Page 11

               For  the  year-to-date   period  sales  were  $37,656,000,   an
               increase of 8.4% over prior year.

               In the US market  sales  increased  5% during the  quarter  and
               were  down 1.6% for the  year-to-date  period.  This  marks the
               first   quarter   since   quarter   two  of   2001   that   the
               year-over-year US sales comparisons have been positive.

               International  sales for the quarter increased 10.3% over prior
               year. For the year-to-date  period  international sales were up
               over prior year 19.1%.

               Excluding  the effect of  currency,  international  revenue was
               down 1.6% for the  quarter  and grew  2.8% for the  first  nine
               months of 2003.

               ICL and Toric ICL revenue grew 15.5%  during the  quarter,  and
               unit  sales  grew  15%.   STAARVisc  sales  were  flat  in  Q3.
               AquaFlow sales declined  8.7%,  specialty lens sales  increased
               to 22% with  Collamer  lens sales up 28%.  silicone  lens sales
               declined 17% during the third quarter.

               For the  year-to-date  period  ICL and Toric ICL  revenue  grew
               34.6%.  STAARVisc  sales  increased to 20.5% and AquaFlow sales
               declined  13.7%.  Specialty  lens sales  increased  14.4%,  and
               silicone lens sales declined 15.8%.

               Gross profit excluding  royalty income for the quarter was $6.6
               million,  approximately  $1  million  higher or 19.7%  increase
               over prior year.  Gross  margin was 55.2%,  a full 5-1/2 margin
               points  improvement  over  prior  year  quarter.   Year-to-date
               gross margins including royalty income was 54.6%,  again a 5.5%
               margin improvement over the prior year year-to-date period.

               Gross margin improvements  continue to be the result of reduced
               cost structures in our manufacturing  facilities and production
<PAGE>
                                                                STAAR SURGICAL
                                                        Moderator:  Doug Sherk
                                                           10-30-03/3:30 pm CT
                                                          Confirmation #555304
                                                                       Page 12

               yield and efficiency  improvements  and increases.  In addition
               to the up tick in the US IOL  business,  which  had a  positive
               impact on gross margin,  we've mentioned  previously in some of
               our calls that the US IOL  product  line  operates  at a higher
               gross margin  percentage than the  international  IOL business.
               So our cost  structures  are  improved by cost  reductions,  by
               yields,  by  efficiencies,  and  also  by  mix of  product  and
               geographies in the US marketplace.

               General and  administrative  expenses in Q3 were $2.3  million,
               an 11%  increase  over the  prior  year.  The  increase  in G&A
               reflects  increased  legal and audit fees  associated  with the
               SEC consultation  related to the accounting treatment for loans
               to officers  and  directors.  And I'll  discuss  that in detail
               later.  This was a  one-time  event,  which we do not expect to
               reoccur.

               Year-to-date G&A expenses were $6.8 million,  which was flat to
               prior year spending.

               Sales and  marketing  expenses  during the  quarter  were $5.05
               million,  approximately  $1 million  above Q3 of 2002.  For the
               year-to-date  period expenses were $13.6 million, a 9% increase
               over the same period in 2002.

               As mentioned in last  quarter's  conference  call,  the company
               has  initiated  activities   associated  with  the  anticipated
               launch  in  2004  of  the  ICL.  The   increased   spending  in
               marketing  and  selling was the result of  additional  salaries
               and travel,  one-time  employee  relocation  and hiring  costs,
               marketing,  consulting,  and  promotional  activities,  and the
               loss  on  disposal  of a  trade  show  booth.  We  continue  to
               streamline  the US  operating  structure  to  help  offset  the
               increase in marketing and selling activities.

               During    the    quarter    the    company    integrated    the
               phacoemulsification  business  into  the  Monrovia,  California
<PAGE>
                                                                STAAR SURGICAL
                                                        Moderator:  Doug Sherk
                                                           10-30-03/3:30 pm CT
                                                          Confirmation #555304
                                                                       Page 13

               facility,  which will provide  substantial  operational savings
               and better coordination and communications with the business.

               Spending  for  R&D  in  clinical  and   regulatory   activities
               increased in the third quarter.  Spending was $1.3 million,  up
               32% over Q3 of 2002 but down slightly  from the second  quarter
               of  this  year.  For  the  year-to-date   period  research  and
               development   expenses  were  increased  to  $3.9  million,   a
               $800,000 or 26.8% increase over the same period one year ago.

               Total  SG&A  and R&D  spending  for the  third  quarter  was $9
               million.   Including  the  net  charge   associated   with  the
               write-down  and  reversal of  reserves,  the total SG&A and R&D
               expenses  were  $8.7  million.  For  comparison  purposes  this
               compares to $7.1 million in spending  for the third  quarter of
               2002, which excludes the charge for employee separation costs.

               During the third  quarter the company  wrote down $2.1  million
               in  capitalized  patent  intangibles  in  connection  with  its
               yearly  SFAS  144  analysis,  which is the  accounting  for the
               impairment   of   long-lived   assets.   These   patents   were
               recognized  during the  acquisition  of Circuit Tree Medical in
               December  of 1999.  Additionally,  the  company  reversed  $1.7
               million of reserves against former officers' notes,  which were
               collected during the quarter,  resulting in a net charge of $.4
               million.

               Operating  loss for the  quarter was $2.5  million  compared to
               $1.7  million  in the prior  year.  On a  comparable  basis and
               excluding  unusual  charges the operating loss this quarter was
               $2.1  million  compared  with $1.5  million in the same quarter
               last year. The  year-to-date  operating loss excluding  charges
               was $3.7 million versus a comparable  prior year operating loss
               of $5 million.
<PAGE>
                                                                STAAR SURGICAL
                                                        Moderator:  Doug Sherk
                                                           10-30-03/3:30 pm CT
                                                          Confirmation #555304
                                                                       Page 14

               Total other  income and  expense  for the quarter was  $180,000
               better.  Within the  various  categories  interest  expense was
               $90,000  less than prior  year.  Equity and  earnings  of Canon
               STAAR JV was $159,000  better than prior year.  Exchange  gains
               and  losses  were  $152,000  less.  And  interest   income  was
               $50,000 favorable.

               For the  year-to-date  period  other  income and  expense is $1
               million favorable to the corresponding  period last year due to
               reduced interest expense,  favorable exchange gains and losses,
               and  improved  equity and  earnings  of the Canon  STAAR  joint
               venture.

               As in prior  quarters,  the  company  recorded  no  income  tax
               benefits on US entity net operating losses.

               Net  loss for the  quarter  was $2.7  million  or 15 cents  per
               share.  Net loss  for the  third  quarter  of 2002 was 12 cents
               per share.  On a comparable  basis  excluding  unusual  charges
               net loss this  quarter was $2.3  million or 13 cents per share,
               and net loss in the same  quarter last year was $1.9 million or
               11 cents per share.

               For the  year-to-date  period  net loss was $4.8  million or 28
               cents per  share.  Net loss for the same  period  last year was
               41 cents per share.  Again excluding  charges the net loss this
               year was $4.4  million  or 25 cents per share and for last year
               was a 38 cent loss per share.

               As  of  October  3,  2003  STAAR's  cash  and  cash  equivalent
               position  was   $9,861,000,   and  total  notes   payable  were
               $3,257,000.

               Inventories  were $12  million,  which is a  $200,000  increase
               over year-end 2002.
<PAGE>
                                                                STAAR SURGICAL
                                                        Moderator:  Doug Sherk
                                                           10-30-03/3:30 pm CT
                                                          Confirmation #555304
                                                                       Page 15

               Accounts  receivable was $6.2 million, a $400,000 increase over
               year-end 2002.

               Cash flow from operating activities was $1.2 million negative.

               Capital expenditures for the quarter were $391,000.

               Proceeds  from  the  collection  of  notes   receivable,   $2.2
               million, and proceeds from stock options $600,000.

               Net increase in cash for the quarter was $1.4 million.

               As many of you know and as I mentioned  during the  explanation
               of  the  increase  in  G&A  expenses,  STAAR  has  had  ongoing
               discussions  during  the  quarter  with the office of the Chief
               Accountant of the SEC Division of Corporate  Finance  regarding
               STAAR's  historical  method of accounting for promissory  notes
               received  from former  officers and  directors.  On October 29,
               2003 the Office of the Chief Accountant  informed STAAR that it
               considered  the issue to be an audit  matter  best  resolved as
               determined by STAAR and its auditors.

               STAAR and its auditors,  BDO Seidman,  have thoroughly reviewed
               the facts and  circumstances  of the notes in question and have
               determined  that the notes  were  accounted  for  appropriately
               with  the  exception  of the  method  used to  accrue  interest
               income.  The company has determined  that this is an accounting
               error and that it will require a  restatement  of its financial
               statements  for the year  2000,  2001,  and  2002,  and for the
               first quarter of 2003, and the second quarter of 2003.
<PAGE>
                                                                STAAR SURGICAL
                                                        Moderator:  Doug Sherk
                                                           10-30-03/3:30 pm CT
                                                          Confirmation #555304
                                                                       Page 16

               The impact to the financial  statement in each of those periods
               is as  follows.  For  the  year  2000  pre-tax  impact  will be
               reduced by $281,000.  For the year 2001 pre-tax  income will be
               reduced by $161,000.  For the year 2002 pre-tax  income will be
               increased by $226,000.  For Q1 of the year 2003 pre-tax  income
               will be  decreased  by  $211,000.  And for the  second  quarter
               2003 pre-tax income will be reduced by $53,000.

               We are  extremely  pleased  and  relieved  to have this  matter
               behind  us  and  will  continue  to   vigorously   collect  the
               remaining  notes in a manner  similar  to the $5.5  million  in
               notes,  which  have been  collected  to date.  As of the end of
               the third quarter,  $1.9 million in notes from former  officers
               and directors remain to be collected.

               I'll spend a brief  minute on some  guidance for the balance of
               the year.  And  basically we believe  that STAAR will  generate
               growth  in the area of 6 to 7% for the  year  based on sales in
               2002 of $47.9 million.

               We are also still  comfortable with our estimated cost required
               to  launch  the  ICL,  as  David   clearly   described  in  his
               presentation,  which we told you would be an  incremental  $2.5
               million  during  2004.  But we also  told you that we'd need to
               spend $1.1 million on additional  sales and marketing  expenses
               during the third and  fourth  quarters  of 2003.  And we are on
               track with these estimates.

               Regarding  2004  we are  currently  engaged  in  our  operating
               planning   process  and  will   finalize  our  plans  in  early
               December.  At that  time we plan to offer  our  2004  full-year
               guidance to  investors.  In the  meantime we believe  that 2004
               will be a  growth  year  and  that  the  company  will  achieve
               profitability in the second half of the year.
<PAGE>
                                                                STAAR SURGICAL
                                                        Moderator:  Doug Sherk
                                                           10-30-03/3:30 pm CT
                                                          Confirmation #555304
                                                                       Page 17

               Now I'm  going  to turn it  over  to  David.  And for a  minute
               though  let  me  talk  about  some  of the  investor  relations
               highlights.  Let's see  STAAR  will be  presenting  at the CIBC
               Healthcare  conference on November 10th, and the Harris Nesbitt
               Gerard  Healthcare  conference  on December  11th. We will also
               be visiting  various  investors  around the country  during the
               weeks of those conferences.

David Bailey:  Thanks, John.

               In addition to those two  conferences  I'd just like to mention
               that once again we'll be hosting a booth at the AAO  conference
               in Anaheim, which is November the 14th through the 19th.

               With all of that  said and the  comprehensive  review  by John,
               I'd like to open up for questions.

Operator:      Thank you, sir.

               Ladies and gentlemen, if you have a question,  please press the
               Star  followed  by  the 1 on  your  push-button  phone.  If you
               would like to decline from the polling  process  press the Star
               followed  by  the  2.  You  will  hear  a   three-tone   prompt
               acknowledging  your  selection,  and  your  questions  will  be
               polled  in the  order  they  are  received.  If you  are  using
               speaker  equipment,  you will need to lift the  handset  before
               pressing the numbers.

               One moment, please for the first question.

               Once  again,  if you have a  question,  please  press  the Star
               followed by the 1 at this time.
<PAGE>
                                                                STAAR SURGICAL
                                                        Moderator:  Doug Sherk
                                                           10-30-03/3:30 pm CT
                                                          Confirmation #555304
                                                                       Page 18

               And our first  question comes from Mr. Ryan Rauch with SunTrust
               Robinson Humphrey.  Please go ahead.

(Ameed):       Hi, guys.  It's actually (Ameed) calling for Ryan.

David Bailey:  Hi (Ameed).

(Ameed):       A couple  quick  questions  - with regard to the ICL I wouldn't
               say  guidance  but you said  that they  would - you think  they
               might exceed what analysts have out there?  I'm just  wondering
               if you can kind of  quantify  that for us, what you see as, you
               know, the potential there or a number,  if you're willing to do
               that.

David Bailey:  Yeah,  two  points  to make  there.  First  off,  I said I felt
               comfortable  with the current  estimates that you guys have for
               the sales.  I believe  that the market  will be larger than the
               current  estimates.  And at this stage I don't want to quantify
               our sales projection.  We'll do that at a later date.

               Just to reiterate,  we feel very  comfortable  with the numbers
               that are out there in terms of sales  projections.  And we feel
               that the market will be larger than the  current  estimates  by
               even the most optimistic ones that are out there.

(Ameed):       Okay,  fair  enough.   And  the  three  piece   Collamer,   I'm
               wondering  if we can get a little  bit more  detail  on  what's
               going on there with the injection  system and what you're doing
               to get that going by the new time frame?

David Bailey:  Yeah.  Well the  first  thing  I'd  want to  point  out was the
               overall  goal  was to turn  the US  market  around.  And  we've
               achieved  that without the  Collamer 3 piece likely  because of
               the growth we're seeing in the one-piece  lens,  which is doing
<PAGE>
                                                                STAAR SURGICAL
                                                        Moderator:  Doug Sherk
                                                           10-30-03/3:30 pm CT
                                                          Confirmation #555304
                                                                       Page 19

               very  nicely,  and we're very  pleased with that on the back of
               the marketing efforts with the Collamer material.

               In terms of the - and so we expect that growth to continue  and
               to sustain  that  improvement  in the US market.  For the three
               piece we are  clear on the kind of  injection  system  we need.
               We're  realizing  that we have to do some work to finesse  that
               particularly  as regards  to the  lubricity  of the  cartridge,
               which the Collamer 3 piece lens has some unique properties.

               So that's the  challenge  we have.  We know we can get  through
               that,  it's just taking  longer than  expected.  And  obviously
               that's  disappointing,  but critically  we've been able to turn
               the US business  around even without that product.  And I think
               I've  indicated  on  previous - well I know I've  indicated  on
               previous  meetings  that that product  alone would open up a $3
               to $5 million opportunity.

(Ameed):       Okay.  And then sorry for jumping  around,  but back to the ICL
               internationally,   can  you  comment  on  which   countries  in
               particular saw strong unit growth outside of Australia?

David Bailey:  Yeah, I mean,  the big thing that happened in quarter three was
               the   seasonality,   which  we  expect  in  Europe,   was  more
               protracted  than  normal.  I think that was  partly  because of
               the  prolonged  hot  summer.  So  we  still  got  growth,   but
               everything  slowed down more than we'd  anticipated.  Testimony
               to that and the fact it was  transitional  was the fact that we
               saw a nice  pick up in  September.  And we're  seeing  the same
               trends moving along.

               Korea,  which was very strong in the first  quarter  where we'd
               had 54% unit growth,  we also saw a low over the quarter  three
               period,   which  was  reflective  of  a  reduction  in  overall
               refractive volume in Korea.
<PAGE>
                                                                STAAR SURGICAL
                                                        Moderator:  Doug Sherk
                                                           10-30-03/3:30 pm CT
                                                          Confirmation #555304
                                                                       Page 20

               Now we've just  attended the latest  Korean  national  meeting,
               literally two weeks ago, and we're  starting to see volume pick
               up there.  So overall  the  seasonality  in Europe was  greater
               than  we've   anticipated.   That   particularly  hit  elective
               surgery,  i.e.  refractive  surgery.  So we were  down  further
               than we had  anticipation.  But as I said,  we're  seeing  that
               rebound, and we saw it in September.

(Ameed):       Okay.  And then just off of that,  in  October  how are the ICL
               trends  internationally  going  there,  if you can  comment  on
               that?

David Bailey:  Well we see a continuation of what we saw in September.

(Ameed):       Okay,  terrific.  That's all for me,  guys.  David,  I hope you
               feel better.

David Bailey:  Thanks a lot - appreciate it.

Operator:      Thank  you.  And  our  next  question   comes  from  Mr.  (Eric
               Chiprich)  with  Harris  Nesbitt  Burns.  Please go ahead  with
               your question.

(Eric Chiprich):  Hi,   gentlemen.   This  is  (Eric   Chiprich)  for  (Joanne
               Wench).

               Just a question  on the  expenses in SG&A for the quarter - can
               you give us a sense of how much of the $1.1  million  was spent
               for the ICL and then also what  some of the other  expenses  on
               legal just to kind of get a sense of what  would be  continuing
               going forward?

David Bailey:  Yeah,  (Eric),  thanks.  Well let me head off  with  sales  and
               marketing,  and then John might just want to comment on the G&A
               piece,  which we don't  think - well we know is not going to be
               reoccurring.
<PAGE>
                                                                STAAR SURGICAL
                                                        Moderator:  Doug Sherk
                                                           10-30-03/3:30 pm CT
                                                          Confirmation #555304
                                                                       Page 21

(Eric Chiprich):  Okay.

David Bailey:  Essentially  we spent $1 million more this quarter on sales and
               marketing  than  we did  the  quarter  three  last  year.  This
               breaks down into one-time charges and then ongoing expenses.

               Approximately   a  quarter   of  the   increase,   $250,   were
               non-recurring   items  related  to  the  relocation  of  a  key
               employee and the  write-down  of the  residual  value of an old
               exhibition  booth, as John indicated.  Now the remainder of the
               increase was driven by  expenditure  on new marketing  programs
               with an external  agency - that was  anticipated and is kind of
               front  end  loaded - and by  increasing  headcount  for the ICL
               launch.

               So let me give you a flavor  for that.  During  the  quarter we
               employed six proctors,  trainers, and one director of education
               as well as adding  approximately  four direct  sales aids.  All
               of that was planned  because  we're  obviously  seeing a raised
               level of  interest  in the  ophthalmic  community  for the ICL.
               And just on that  point we had more than 50  surgeons  from the
               US that'd been  introduced  to the  product  during the quarter
               three  period  by  visiting  outside  of  the  US.  Mainly  the
               majority went to Mexico and the Dominican Republic.

               Now  in  line  with  our  plans  going  forward  those  courses
               generate  a   sufficient   income  to   adequately   cover  all
               expenditure.  So there  was no  negative  impact to the P&L for
               running those courses.

               This is exactly  the same model  we're  using to  relaunch  the
               product in  existing  markets  such as South  Africa  with such
               good results.  So just to kind of underline,  because this came
               up on a previous call, the training  program,  the 1 or first 2
<PAGE>
                                                                STAAR SURGICAL
                                                        Moderator:  Doug Sherk
                                                           10-30-03/3:30 pm CT
                                                          Confirmation #555304
                                                                       Page 22

               days,  is not going to impact  the P&L.  The  impact to the P&L
               will be the  proctoring,  and you've already seen that in terms
               of six  people  being  brought  on  board.  We  expect to go to
               eight for the time of launch.

(Eric Chiprich):  Thank you.  And...

David Bailey:  Does that give you enough on the sales and marketing?

(Eric Chiprich):  Yes,  that gives a very good sense.  I take it that a lot of
               this $1.1  million  then was spent in the third  quarter  then.
               It was more heavily weighted that way for the ICL?

David Bailey:  A portion of it will be, yes.

(Eric Chiprich):  Okay.

David Bailey:  Yes.  There  will be  incremental  in the  second.  But the two
               together  will go to the  $1.1  that  we've  indicated.  And as
               John said, we feel comfortable with that.  We're on track.

(Eric Chiprich):  Got you.  And then,  as for the  training  courses  that you
               said are going to be a day or two long,  is that going to be in
               the  ophthalmologist's  office,  or are you going to be hosting
               this in one  general  area for a group of  ophthalmologists  to
               come into?

David Bailey:  No,  they would be in selected  centers,  some of which will be
               ophthalmologist  refractive  centers  and some will be off-site
               centers  close to the trainer's  center.  And they'll be around
               the  country.  And two of them  will  certainly  coincide  with
               next year's  ASCRS and next year's AAO.  And we'd be  targeting
               between 30 to 40 people for each of the courses.
<PAGE>
                                                                STAAR SURGICAL
                                                        Moderator:  Doug Sherk
                                                           10-30-03/3:30 pm CT
                                                          Confirmation #555304
                                                                       Page 23

(Eric Chiprich):  Great.  And then finally on the  AquaFlow,  the single digit
               decreases that we've been seeing the last couple  quarters,  is
               that expected run rate going forward?

David Bailey:  Yeah.  Well, I said last time that due to the  reallocation  of
               the proctoring  results we reported a decline in AquaFlow sales
               for the first six months of the year.  John  highlighted  that.
               Our  commitment  was to  reverse  this  decline  in the  second
               half.  So  quarter  three  the  rate of the  decline  has  been
               halted  versus  the  prior  year  period.  In  fact,  we saw an
               increase of 11% in revenue  sequentially with a 17% increase in
               units.

               We  continue to believe  that this is a great  product and that
               we'll  meet the  stated  goal,  which  was that the  corrective
               action would eliminate the decline in the second six months.

(Eric Chiprich):  Sounds good.  Thanks very much.

David Bailey:  Thanks, (Eric).

Operator:      Thank you. The next  question  comes from Mr. (Chad Suggs) with
               CIBC World Markets.  Please go ahead.

(Chad Suggs):  Thank  you.  Good  afternoon,   guys.  This  is  in  for  (John
               Calcanini).

David Bailey:  Hi, (Chad).

(Chad Suggs):  Hi.  Can you go over - I think  you  mentioned  what  the  debt
               level  was.  I didn't  catch  that and then,  secondly,  if you
               have a number for shareholders' equity?
<PAGE>
                                                                STAAR SURGICAL
                                                        Moderator:  Doug Sherk
                                                           10-30-03/3:30 pm CT
                                                          Confirmation #555304
                                                                       Page 24

John Bily:     I don't -  shareholders'  equity  - do we have - I can give you
               the  total  debt for  sure.  Let me look  here.  It was - total
               debt was $3,257,000.

(Chad Suggs):  Okay.

John Bily:     And that's our notes payable in Switzerland.

(Chad Suggs):  Okay.

John Bily:     We have no US debt whatsoever.

David Bailey:  I'm told cash at the end of the  quarter - John,  you gave that
               number as well - (Chad), did you pick that up?

(Chad Suggs):  Yes,  I  have  that.  And  then  next  question,  going  to the
               certification of the ICL, the two-step procedure,  is that just
               in the US, or is that something  that you're  carrying into all
               the countries?

David Bailey:  Well, as I said,  (Chad),  when I came into the company in '01,
               I introduced  that exact same process into the new markets that
               we  launched,  which was Canada and Korea.  Now we've backed in
               to the  countries  where it had already been  launched  back in
               '97,  '98  to  try  and  reinforce   that  same   certification
               program.  Unfortunately  it's  more  difficult  to  go  into  a
               market  where  you've  had an  uncontrolled  launch and kind of
               recontrol  it.  But I would  use  South  Africa  as a very good
               example  where  from  March  this  year  we've  gone in and run
               recertification  courses.  We had one one week ago,  which John
               Vukich  ran at the  South  African  National  Society  where we
               trained 14 surgeons.  And that was very successful.
<PAGE>
                                                                STAAR SURGICAL
                                                        Moderator:  Doug Sherk
                                                           10-30-03/3:30 pm CT
                                                          Confirmation #555304
                                                                       Page 25

               So new markets,  absolutely rigid program that's cost neutral -
               we're trying to roll that out into  markets  where a launch had
               occurred  but  it's  more   difficult,   but  we've  been  very
               successful  in South Africa and intend to  implement  that in a
               similar  way in two  other  large  markets,  which is Italy and
               France,  where  we think  we've  got  some  significant  upside
               potential  with  the  product.   Those  two  markets,   if  you
               remember,  we changed  distributor  last  quarter.  And part of
               that  change  was to  revitalize  the  efforts  around  renewed
               training of the ICL.

(Chad Suggs):  Okay.  And then  lastly,  can you give us an idea of what total
               cataract business growth was year-over-year?

David Bailey:  Yeah,  we could  probably  do that best  individually.  I don't
               know if we've got that number exactly to have...

Deborah Andrews:  (Unintelligible)

David Bailey:  No total cataracts - it's a question  related to a breakdown of
               cataract  refractive.  Let's  come  back  to you on  that,  and
               we'll check it out, (Chad).

(Chad Suggs):  Okay, sure.  Thank you.

John Bily:     On the balance  sheet also we should be able to - you know,  we
               just did  complete  our  issues  with  our SEC  work  yesterday
               afternoon.   So  we  apologize  for  that.  But  we'll  have  a
               balance sheet out either tomorrow or Monday for everybody.

(Chad Suggs):  Okay, great.  Thank you.

Operator:      Thank  you.  And  the  next  question   comes  from  Ms.  (Kate
               Sheridan) with Pacific Growth Equities.  Please go ahead.
<PAGE>
                                                                STAAR SURGICAL
                                                        Moderator:  Doug Sherk
                                                           10-30-03/3:30 pm CT
                                                          Confirmation #555304
                                                                       Page 26

(Kate Sheridan):  Hi, everybody.

David Bailey:  Hi, (Kate).

(Kate Sheridan):  Hi, Dave.  I have your cold.

               I was  curious  on the CME  course,  the 400  people  that have
               registered  already.  Can you  characterize  those?  These  are
               not obviously  people - are these  anybody  that's been trained
               already or wanting  to do the CME to get  credit,  or are these
               other people that then would be...?

David Bailey:  I don't  know that  exact  breakdown,  (Kate).  But I would say
               that  probably  most  people have not been  trained  that would
               attend this.

(Kate Sheridan):  Okay.

David Bailey:  And the mail  shot for this  only  went out last  week.  And at
               that  point,  when the mail shot went  out,  we had 311  people
               signed  up for the  calls or Ocular  Surgery  News did.  I gave
               the  Website.  So I would tend to say that this is new interest
               as  opposed  to people  that have had any  exposure  to the ICL
               surgery  through  going  outside  of the US.  I  think  this is
               reflective  of new interest.  And obviously  it's partly driven
               by the positive outcomes to the panel meeting.

(Kate Sheridan):  Right.  And I guess  where I was  just  trying  to get  more
               color on is, you know,  you had a few  hundred  people  trained
               already  I  thought.  And then  could we just  guess  that this
               might  add to that?  Or will  you be able to - I mean,  because
               then you also  have I guess  sort of how you  wanted to be very
               selective  at who does get trained and who does get  proctored,
               the type of  surgeon,  et  cetera,  is there a way to know that
<PAGE>
                                                                STAAR SURGICAL
                                                        Moderator:  Doug Sherk
                                                           10-30-03/3:30 pm CT
                                                          Confirmation #555304
                                                                       Page 27

               all these 400  people  plus the ones that are  already  trained
               are within  that I guess,  you know,  outline of what you would
               target?

David Bailey:  Excuse  me,   (Kate).   I  think  the  CME  program  is  on  to
               familiarize   people   with  the  ICL  or  with   Phakic   IOL,
               specifically  the ICL. The majority of the attendees  will have
               not been  exposed  to the STAAR  ICL  courses  by  having  gone
               outside the US.

               All of the people  that  attend this will have to attend one of
               the STAAR one or two day courses  throughout  2004, which we're
               planning  around  about 10. So  really we see this  meeting  as
               feeding  interest to then feed into the official  certification
               training  courses  as  opposed  to this  being a  certification
               course on its own.  That said,  some  people may attend  who've
               been exposed  externally.  But I think the majority will be new
               interest, your new surgeons.

               And just to  reiterate  the point I made,  we've had a lot of -
               the  311 or now  sort of the 400  are  doctors.  At this  stage
               we've  not  allowed   assistants  and   additional   people  to
               register.  We're  purely  focusing on the doctors at this stage
               because we've had such strong  interest.  And that's on on this
               Sunday morning, (Kate), from 7 to 9.

(Kate Sheridan):  Right,  okay.  And  then  -  okay.  And  how  many  training
               courses are you going to be holding?

David Bailey:  Assuming approval we're currently planning for around about 10.

(Kate Sheridan):  Ten - and how many slots would be per course?

David Bailey:  Thirty to 40 people per course.
<PAGE>
                                                                STAAR SURGICAL
                                                        Moderator:  Doug Sherk
                                                           10-30-03/3:30 pm CT
                                                          Confirmation #555304
                                                                       Page 28

(Kate Sheridan):  Thirty to 40, okay.

David Bailey:  Probably an average of 30, but we could go up to 40.

(Kate Sheridan):  All right.  Good.  Thanks.

               Just going back to the  question  that was asked  about the ICL
               revenue  as it  relates to what you  thought  about  estimates,
               frankly  you've got a number out there.  What do you see as the
               high  estimate  right now? So what number are you talking about
               that you could meet or exceed  because I really  don't  think I
               know what all the estimates are?

David Bailey:  Well,  I don't want to cause  confusion  on this,  and it seems
               like I have.  I'm  very  comfortable  with  the  estimate  that
               analysts  have  out  there  for  what we  will  sell  into  the
               market.  I'm  more  optimistic  as the  market  size  than  the
               current analysts  estimates.  I think Phakic implants are going
               to be larger than the current market that's being  indicated by
               the analysts.

(Kate Sheridan):  Right.  But  you're  talking  about  a  number  that  you're
               comfortable with with respect to what we are estimating.

David Bailey:  Yes.

(Kate Sheridan):  I know what I'm  estimating.  I just haven't  actually  seen
               the  details  of  everybody  else's.  Can  you  give us a rough
               number of what that might be?

David Bailey:  Oh it's a range  from 5 to  7,000  units I  think,  (Kate),  by
               memory.  And, you know,  as I said,  we feel  comfortable  with
               those numbers.
<PAGE>
                                                                STAAR SURGICAL
                                                        Moderator:  Doug Sherk
                                                           10-30-03/3:30 pm CT
                                                          Confirmation #555304
                                                                       Page 29

(Kate Sheridan):  Okay, that's helpful.

David Bailey:  We are giving  specific  guidance.  But as you can tell, I feel
               really  comfortable  given the level of interest  we're getting
               with those kind of numbers.

(Kate Sheridan):  Okay,  great.  And  have  you had any  more  information  on
               Taiwan?

David Bailey:  Yeah,  we  obviously  follow up on all of these  approvals.  On
               Taiwan  specifically  I gave a strong  update last time.  We've
               had delays  with this one and  repeated  requests  for the same
               information.  So we've decided to engage a local  consultant to
               monitor local activity on this submission.

               None of the requests  we've had cause us to think that approval
               should not be granted.  But we're  concerned at the  inordinate
               amount of time that this is  taking.  We're  comforted  that we
               know other companies with other  applications  are experiencing
               similar  delays.  But we're  going to try and manage  that more
               locally.  And we believe that the  approval  could come through
               any time on Taiwan.

(Kate Sheridan):  Okay, very well.  Thanks very much, everybody.

David Bailey:  Thanks, (Kate).

Operator:      Thank you.  Once  again,  if you would like to ask a  question,
               please  press the Star  followed  by the 1 at this  time.  As a
               reminder,  if you're using speaker equipment,  you will need to
               life the handset before pressing the numbers.

               Our next  question  is a  follow-up  question  from  Mr.  (Ryan
               Rauch).  Please go ahead.
<PAGE>
                                                                STAAR SURGICAL
                                                        Moderator:  Doug Sherk
                                                           10-30-03/3:30 pm CT
                                                          Confirmation #555304
                                                                       Page 30

(Ameed):       Hi, guys.  It's (Ameed)  again,  just one quick  follow-up.  It
               seems  like the  competitive  landscape  for you guys  seems to
               improve.   We're  hearing  that  Medennium  has  stopped  their
               clinical  trials.  We  obviously  heard  during  the panel that
               (Ophtech)  panel  will be delayed  now.  Can you  comment  even
               perhaps  anecdotally  on what's going on with those  companies?
               Is it related to  endothelial  cell loss, or anything you might
               be able to add there?

David Bailey:  Well I think on the PRL it's  well  known  that the  Phase  III
               clinical's  are on hold because of  endothelial  cell loss. The
               same is true in  Japan  when I was  down  there.  They  were on
               hold there.

               I think  the real  answer  here  goes back to a point I made on
               the call two weeks ago in that we set a fairly  heavy  standard
               around the  endothelial  cell  count  issue.  You know,  as the
               world's  expert,  Hank  Edelhauser  pointed out to the FDA in a
               multi-centered  trial you need to adopt a single expert reading
               center to measure  cell  counts,  if you want to  increase  the
               accuracy of the reading.

               We  learned  this  early on in the ICL  study  and  used  Emory
               University  to  do  all  of  the  readings.  As  a  result,  we
               obtained  very  reliable  data  with a very  narrow  confidence
               interval.   Any  trial,   which  has  not   adopted   the  same
               methodology,  will have great difficulty.  We believe, although
               we cannot confirm,  that our competitors  will have significant
               challenges with this issue that could delay approval.

               In  addition,  I think  it's  worth  pointing  out that  once a
               product is approved into the market, a breakthrough  technology
               in a new area,  it  becomes  much  more  difficult  to  recruit
               patients  into new studies.  So that's  another  factor,  which
               following approval or hope for approval, would play in.
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               So I think in a  nutshell  we've set a very high  standard  for
               the  endothelial  cell count  issue.  And I think other  people
               are  having to face up to those  same  challenges.  And I think
               that's going to get very  interesting.  I think, you know, if I
               was  put on  the  spot,  I'd  say  we're  gaining  time  on the
               competition all of the time.

(Ameed):       Thank you very much.

Operator:      Thank you. Our next  question  comes from Mr. (Neil  Brandsher)
               with (Broadwood Capital).  Please go ahead.

(Neil Brandsher): Well  first of all  congratulations  on what seems like good
               news on several different fronts.

               On this issue of ICL sales  versus  market size, I just want to
               make sure I understand  what terms we're  using.  When you talk
               about sales,  you're talking about sales  expectations for your
               particular  product.  When you're  talking  about  market size,
               you're talking about the eventual  potential total size for all
               Phakic IOLs.  Is that the distinction?

David Bailey:  Correct, (Neil), exactly.

(Neil Brandsher): Okay.  So the  market  size  number  wouldn't  concern  next
               year,  whereas the only sales numbers I'm aware of are specific
               to next year.  Is that right?

David Bailey:  Correct, yeah.

(Neil Brandsher): Okay. So the implication  here then is people's  numbers for
               next year  you're  comfortable  with.  But to the  degree  that
               people have talked  about an end  potential  number,  you think
               now that it's  probably  going to be  considerably  higher than
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               that,  although  you  may,  of  course,  have to  split it with
               others.  But we don't know what the split is.  And  (Ophtech)'s
               out,  and  Medennium's  out, so it's  looking  better.  Is that
               sort of the bottom line here?

David Bailey:  Yeah, I think that's a fair bottom line.

(Neil Brandsher): Okay,  good.  Then on  seasonality  in  Europe,  we've  been
               hearing  that  from  other  medical  device  companies  in this
               reporting  season.  It's  always  weak  because  a lot  of  the
               doctors  go  on  vacation  for  several   weeks  in  the  third
               quarter.  But it was probably worse this year.

               You  mentioned  the heat  wave.  Are there  any other  factors?
               And,  you  know,   certainly   the  heat  wave  got  a  lot  of
               attention.  You know,  did you really see a clear direct impact
               on that?

David Bailey:  Well we saw  Spain,  Italy,  and  France  close down for longer
               than  normal.   And  anecdotally,   when  we  talked  to  those
               surgeons  at the ESCRS  meeting in Munich,  which was the first
               week of  September,  they  really  had only  just  come back to
               work.

               The only  other  factor was  Korea,  as I alluded  to  earlier.
               Korea  slowed  down  from  the  rate  of  refractive  that  was
               occurring  in the  early  part of the  year  for  economic  and
               political  reasons.  And we're seeing that start to come around
               as well.  And Korea  had been a really  strong  contributor  to
               the first quarter  growth.  So you had  additional  seasonality
               impacting  quarter three plus Korea well down.  And that's kind
               of a double whammy there.

               But,  as I said,  we're  seeing a positive  trend start to pick
               up.  And we would look for that to continue.
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(Neil Brandsher): That makes sense.  Then on the ICL, do I have these  numbers
               correct?  The ICL  was up 15%  year-over-year  in the  quarter,
               and it was up 20% year-over-year in the first half.

David Bailey:  I believe that's correct, (Neil).

(Neil Brandsher): Okay.  If  that's  correct,  it  sounds  as  though  the ICL
               seasonality  was  actually  better than that of the rest of the
               international business.  Is that right or not?

David Bailey:  Yeah, I think you can say that.

(Neil Brandsher): Okay,  because  that's  just  diametrically  opposed to what
               some people had indicated a couple weeks ago  externally to the
               company.

David Bailey:  Yeah.  I mean,  I think  we've  been  very  clear on it,  and I
               think you encapsulated it well there.

(Neil Brandsher): Okay. I just - you know,  people have said some things,  and
               I just wanted to see what the truth is.

David Bailey:  On the SEC  issue  - this  seems  like  obviously  a very  nice
               resolution  here - you  are  essentially  going  to be  issuing
               restated  statements  for the last few years.  Will those be in
               your 10-Q?

John Bily:     Yes.  We will  have  to get  almost  all of  this  accomplished
               before we publish our third quarter 10-Q.

(Neil Brandsher): Okay.
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John Bily:     It's  not  difficult.  It is a lot of  work I must  admit.  The
               numbers are not large,  but we anticipate  getting this done by
               our 10-Q filing date.  We have the numbers.  We quoted them.

David Bailey:  And,  (Neil),  John  talked  about  this at  length.  I  really
               didn't make any comment.  I just want to  emphasize  that we're
               delighted  that this is behind  us.  We're  delighted  with the
               outcome.  We have a little bit of work to do,  but it's  minor,
               and just  pleased to be moving  forward.  And the  increase  in
               G&A that  John  talked  about,  which  was a direct  result  in
               quarter  three  of  this  whole  activity  of  getting  the two
               accounting  firms'  opinions  and  talking  to,  was a one-time
               event.  It was  significant  and  yet  year-over-year  G&A  was
               still slightly down.  We're going to see savings in that G&A.

John Bily:     Well somebody had asked that question earlier.

David Bailey:  (Eric).

John Bily:     (Eric) - and we didn't  answer  that.  But there is a good - in
               excess of  $200,000  in our  third  quarter  of G&A.  So if you
               look at our numbers,  we would have been down  year-to-date and
               flat  versus  prior  year  in  the  quarter.   So  this  was  a
               significant  amount of work with my staff,  with BDO,  and with
               our law firm Sheppard,  Mullin.  So we are very,  very happy to
               have this done.

(Neil Brandsher): You said you would have been down.  You're  referring to G&A
               expense  would have been down  rather  than up $240 or whatever
               it was.

John Bily:     Well on a year-to-date basis because we were flat year-to-date...

(Neil Brandsher): Oh I see what you were saying, got you.
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John Bily:   ...we would have been down only for the  year-to-date  period and
               kind of flat in the quarter in the prior year.

(Neil Brandsher): I got you.  Okay.

David Bailey:  The  (unintelligible)  increase  in the  quarter  was driven by
               that number.

John Bily:     Fundamentally, yes.

(Neil Brandsher): Right.  And  just  to  make  sure  I  understand  this,  the
               historical   change  in  the  income   statements,   you  know,
               obviously  there's no cash impact of that, and the other aspect
               of this was that you were  caused  to  release  reserves  so it
               actually  has a net benefit to  earnings on a complete  company
               to date  basis of $1-1/2  million,  if I net that out.  Is that
               correct?

John Bily:     Yeah,  we showed the $1.7  reversal as kind of a  non-recurring
               event.  But clearly we did release those  reserves.  We will go
               on to a pure  accrual  method of  accounting  as it  relates to
               interest  income on the notes that are outstanding and then, of
               course,   the  restatement  to  prior  years,   which  we  just
               summarized.

(Deborah Andrews):      And  there  will  be a  positive  effect  on  retained
               earnings   because   we'll  also  make  a   retained   earnings
               adjustment  for the periods not  presented,  which is like 4 or
               $500,000.

(Neil Brandsher): So shareholders' equity goes up...

(Deborah Andrews):      Right.

(Neil Brandsher):...on that particular item.  Got you.
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               Great.  Again  congratulations.  It  seems  like a lot of  good
               news.  Thank you.

David Bailey:  Thanks, (Neil).

Operator:      Thank you. Our next question  comes from Mr. (Larry  Heimovich)
               with (HMCC).  Please go ahead.

(Larry Heimovich):      Good  afternoon.  A lot of the  questions  I had  were
               asked by the very  bright  analysts  that  preceded  me, but my
               question to you,  David,  is we've heard that Ophtech  would be
               on the next panel  meeting.  We've  heard talk that it would be
               in January.  I check the FDA Website  pretty  regularly and see
               that there's  nothing  scheduled  yet for 2004.  Are you are of
               any  information  beyond that in regard to when they might next
               be on the panel meeting?

David Bailey:  No, not at all,  (Larry),  other than, you know, what I've said
               earlier  specifically about the bar with regards to endothelial
               cell counts.

(Larry Heimovich):      Thank you. Do you have any  indication  that they have
               a challenge in that area?  You  mentioned  the PRL.  (Denny and
               Stevalens) had some issues with  endothelial  cell counts.  Are
               you aware of  specific  problems  with  Ophtech's  lens in that
               regard?

David Bailey:  Not  specifically,  (Larry),  I mean,  there's  some  anecdotal
               stuff  around.   And  specifically  they  reported  first  year
               endothelial  cell counts,  which had  increased.  That was very
               strange  because you just wouldn't expect that during the first
               year because  that's when the  surgical  trauma  occurred.  So,
               you know, that might indicate variability.

               And I'd just  bring  people  back to the point I made that on a
               multi-centered  trial site you really  have to have one reading
               center.  We learned  that early.  And I do believe that Ophtech
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               do not use a central  reading  center.  And that will result in
               increased  variability  on that factor.  So the data would need
               to be looked at very, very carefully.

               So we know two  things.  You need a central  reading  center to
               reduce the  variability.  Hank  presented  that to the FDA.  We
               also know that  Ophtech  do not use a central  reading  center.
               So I'll leave people to draw their own conclusions.

(Larry Heimovich):      Regarding  FDA  approval  of the ICL - I  realize  any
               time one  talks  about FDA that  it's  very  difficult  to make
               predictions  or projections - for internal  planning  purposes,
               David,  when would you be ready to really  launch the ICL?  And
               when in terms of planning  process do you start  assuming  it's
               in the  business  plan for next year?  Are we looking at, let's
               say, the second  quarter  actual sales begin to get  generated?
               You  probably  have  some  plan in mind and  some  hope in mind
               about when you can  launch  it. I realize  that hope is so much
               depending on how the FDA moves along,  but was  wondering  what
               your thoughts are there.

David Bailey:  Yeah, I mean, it's out of our control really, (Larry).

(Larry Heimovich):      Of course,  I understand  that. But you've got to make
               some plans nonetheless internally.

David Bailey:  Yeah,  no,  and  I'm an  aggressive  guy.  So if I told  you my
               aggressive plan, you probably wouldn't believe it.

(Larry Heimovich):      Okay.
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David Bailey:  But I want to be ready  sooner  rather  than  later.  And I can
               see  everybody  in  here  smiling  at me  when  I  said  I'm an
               aggressive  guy.  So we're  pushing  along very hard.  I was in
               Switzerland last week with our manufacturing  facility, to make
               sure  we've  got  the  ramp  up  there.  They've  got a  double
               challenge.  We've  got a  ramp  up on the  Collamer  one-piece,
               which is growing  very  nicely,  and a ramp up on ICL. And then
               internally  it's no  coincidence  Nick Curtis isn't on the call
               because  they're  working very  aggressively  on the  marketing
               plan and  pulling  everything  together.  So,  you know,  we're
               pushing ahead very hard.

               What I do  expect,  as I said in my  main  text,  is  that  our
               discussions  with the FDA I would hope  continue in the kind of
               expedited  manner  that  everything  else  occurred.   The  FDA
               helped us  hugely in that  process.  They put huge  strains  on
               the company,  but I yet would hope the labeling discussions and
               dialog  occurs in a similar  vein.  And I don't see any  reason
               why that wouldn't be the case.

(Larry Heimovich):      All right.

David Bailey:  After all, we do have an expedited review.

(Larry Heimovich):      Yeah.  One last question  about the FDA then - what in
               your mind remains to be  resolved?  Is it just sitting down and
               arriving at a label that  everyone  can be happy with?  Are all
               the other issues of final  approval such as  manufacturing,  et
               cetera,  behind  you that  all that  remains  is  sitting  down
               negotiating  the  label  and then  they can give you the  final
               approval, or are there other matters?

David Bailey:  I'll let Helene comment.
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Helene Lamielle:  The  main  element   remaining  with  FDA  is  the  labeling
               discussion.  During  the  course  of  the  submission  we  went
               through several  manufacturing  (audits).  And some of them are
               still in final stage of  finalization.  So the main  element is
               still  the  labeling  for  which  we  do  not  expect  lots  of
               difficulty or issues.

(Larry Heimovich):      Helene  has  there  been any  issues  at all that have
               come up in regard to  manufacturing?  It sounds  like from what
               you said it shouldn't  be, but just to clarify,  any issues the
               FDA has had with  manufacturing,  with GMPs, anything like that
               that could hold up the approval once labeling is resolved?

Helene Lamielle:  I think  everything will work in conjunction,  and we do not
               expect huge issue with these elements.

(Larry Heimovich):      And I  don't  know  how  many  other  labeling  issues
               you've been  involved  with - or David,  you can perhaps take a
               shot  at  this as well - do the  labeling  issues  on this  one
               strike you as particularly  more  complicated than other times?
               I realize  this is first of class,  and that may  present  some
               challenges.   But  in   general,   is   this   a   particularly
               challenging discussion for the FDA and you to resolve?

David Bailey:  I can't imagine it's more  challenging  than the panel meeting,
               (Larry)...

(Larry Heimovich):      That's true.

David Bailey:...which we had a very positive outcome on.

(Larry Heimovich):      Yes, you did.  Yes, you did.

David Bailey:  And I have  total  faith  in  Helene  and the  FDA to work  any
               issues through.
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(Larry Heimovich):      Okay.  Thank you very much.

David Bailey:  Thanks, (Larry).

Operator:      Thank you. The next question comes from Mr.  (Marvin  Sperling)
               with ING.  Please go ahead.

(Marvin Sperling):      Hi, guys.

David Bailey:  Hi, (Marvin).

(Marvin Sperling):      Can you give us an  update  on the  enrollment  of the
               Toric ICL trial?

David Bailey:  Yeah,  great.  First off it's  progressing  extremely  well. We
               will complete  enrollment by the end of this year and will have
               all of  the  implants  completed  by the  end of  quarter  one.
               Remember  there's a 60-day lead time on the  product.  So I can
               see enrollment  being completed by the end of the year, all the
               lenses being in the manufacturing  process and implanted by the
               end of quarter one.

               At the moment  we've got 84 enrolled to date.  So we have to do
               a year's  follow-up.  So we'd be looking at  completion  of the
               year's follow-up by quarter one 2005.

               What I  would  say  is  anecdotally  the  visual  outcomes  are
               exceptional  with the product.  And there was a presentation in
               Munich by the Neuhann  Group,  which showed the  outcomes  with
               the Toric  product.  And they're  exceptional.  And we hear the
               same thing from our trial  experts.  So we're very pleased with
               the way that's moving along.
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               And in  terms  of  manufacturing,  we're  getting  things  made
               within  the  60-day  lead  time  that  we've   guaranteed.   So
               everything  is looking  very,  very well to  achieve  the goals
               that we communicated to investors some time ago.

(Marvin Sperling):      Very  good.  In regards to the ICL,  you  mentioned  I
               think in this call I heard you correctly  about possibly having
               a new name for the ICL.  Was  this  something  that  came up in
               the panel?

David Bailey:  Yeah, the marketing  group has already been looking at this, so
               it was  kind of  interesting  that it  came up at  panel.  This
               wasn't  prompted by the  comments of panel.  It was actually an
               internal  issue to start  with.  And  we're  just in the  final
               stage of that at the moment.  But yeah,  we will be launching a
               new brand name for it at the AAO.

(Marvin Sperling):      Okay,   great.  And  in  regards  to  the  outstanding
               promissory  notes,  the $1.9  million I  believe  it is, I know
               it's  probably  somewhere  in your Q or your K, but  could  you
               just go over  what  that's  about  again  and when  you  expect
               possibly to see that $1.9 million?

John Bily:     Yeah.  There's  two  separate  notes so to  speak.  One is from
               (Pollet  and  Richardson),  and  that  was as a  result  of the
               settlement in  bankruptcy  with our  ex-Chairman.  We were paid
               $2.2 million plus we took a note. So there's  roughly  $400,000
               remaining  on that.  That  goes  through  2005.  We have a note
               for  about  $1.5  million  -  two  separate   notes  -  to  one
               individual,  an ex-Board member.  And the longest that goes out
               to is June 2004.

               Now  there's a  possibility  that  those  notes  could be paid.
               They carry  significant  interest  rates.  But that's when they
               do come due.

(Marvin Sperling):      Okay.  So we could possibly see that in '04 obviously.
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John Bily:     You could see the  larger of the two notes,  the $1.5  million,
               you  could  see those  being  paid off at any  time,  (Marvin),
               because it is a burdensome interest rate.

(Marvin Sperling):      All right.  Great.  Well good luck at the AAO.

John Bily:     Thank you.

David Bailey:  Thanks, (Marvin).

(Marvin Sperling):      All right.

Operator:      Thank  you.  And  our  last  question  comes  from  Mr.  (Tyson
               Housley) with (Housley Advisory Management).  Please go ahead.

(Tyson Housley):  Gentlemen.

David Bailey:  Hey, (Tyson).

(Tyson Housley):  Sort  of a long  question,  but it gets  to the  point  that
               several  people have been asking - now it appears from speaking
               to you and  listening  to the call that the market  opportunity
               for the ICL is probably  larger than what your initial  rollout
               is going to be next  year.  And the  primary  gating  factor is
               the training and proctoring of surgeons.

               And I was wondering  whether you could review  exactly how many
               people are trained and proctored in the US and  internationally
               now?  And perhaps at some point in the  future,  let's say June
               30th and  year-end,  assuming  let's say there's an approval in
               the first  quarter,  to give us some  sense of how many  people
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               you can - and how quickly  you'll be able to ramp the number of
               doctors who are both trained and proctored?

David Bailey:  Good  question.  Well  first off in the US other than the trial
               experts nobody has been trained and  proctored.  So, as I said,
               some people have attended training courses outside,  but nobody
               has been  proctored.  So within the US the gating factor is the
               ability to  proctor,  and we'll have  eight  people  capable of
               doing that.

               I don't  intend  to go  through  the exact  model  that we use,
               (Tyson).  But  I'll  give you - I'll  paint  some  broad  brush
               strokes.  We expect to be  running  approximately  10  courses.
               We  have  a  capacity  of  30  to  40  people.  We  have  eight
               proctors.  Initially  the proctors  would  usually spend one to
               two days  with a  surgeon  to take them  through  the  learning
               curve.  And then  it's  normal  that a  surgeon  would use some
               implants  and then would  probably  watch and  follow-up  for a
               period of time before  they began  routine  usage.  So in terms
               of the model, I think that's the kind of thought  process we go
               through.

               Now as a result  of  going  through  that,  I've  stated  quite
               clearly I hope on this call that we feel  comfortable  with the
               current  estimates  for unit sales of ICL in the US in '04.  We
               think the  market is bigger  than the  current  estimates.  And
               the way we feel  comfortable  with the  numbers is having  gone
               through  that  kind of  modeling  that I'm just  describing.  I
               don't want to go into any more  detail on that.  But  hopefully
               that paints a good enough picture.
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(Tyson Housley):  Thank  you on that - two  other  quick  questions.  One John
               Bily might be able to answer.  You've done an excellent  job in
               managing  your  cash  flow  while  you've  been  running  at  a
               marginal  loss for a while.  Do you think  that  you'll be cash
               flow break-even in the first half of next year,  because I know
               you've said that you'll probably be running at a loss?

John Bily:     Yeah,  (Tyson),  what we have,  and we talked about it earlier,
               is we're  right in the  process of doing our  operating  plans.
               We  hope  to have  that  done  first  week  of  December.  That
               operating  plan's going to open up the whole  business to us as
               we lay on the  assumptions for ICL and a lot of assumptions for
               US market growth,  cost structures,  you know, and all of those
               things.

               I will  tell you  that we will - as we  mention  all the  time,
               working capital  management is one of our big strategies within
               STAAR.  We have 10  million  bucks in the bank.  We have  sales
               and marketing  programs.  We have inventory and  receivables to
               invest  in, et  cetera.  So while I have not done the  plan,  I
               doubt  that we would be cash  flow  positive  until  maybe  the
               fourth quarter of next year.

(Tyson Housley):  And the last question is  anecdotally  how many doctors have
               you heard,  let's say, have waiting lists for the ICL in excess
               of 25 or 50 people?

David Bailey:  I really don't want to  speculate  on that.  But the issue of a
               waiting list is  individual  to a doctor.  And my experience in
               this  industry  is  patients  will not wait  too  long.  And in
               fact,  when we launched  the Toric in Europe,  the  indications
               were  there  was a lot  of  people  waiting  to  have  it,  but
               actually  when it came  down to it,  it was more  new  patients
               that came along to actually take up the  implants.  So I really
               don't  want to get into  speculation  about how  large  waiting
               lists are or even if there are any waiting lists.

               What I do want to reconfirm  is that we're seeing good,  strong
               interest   from  the   ophthalmic   community   in  wanting  to
               understand  the Phakic,  the ICL.  They're  excited  about what
               happened  at the panel.  And I think  testimony  to that is the
               number that are  planning to attend the CME  breakfast  meeting
<PAGE>
                                                                STAAR SURGICAL
                                                        Moderator:  Doug Sherk
                                                           10-30-03/3:30 pm CT
                                                          Confirmation #555304
                                                                       Page 45

               at the AAO.  And I think  that's  probably a good  indicator of
               the underlying interest.

               Some of them may have  waiting  lists.  I don't  know.  I don't
               want to speculate, (Tyson).

(Tyson Housley):  Thank you very much.  Good luck.

David Bailey:  Thank you.

Operator:      And there are no further questions.  Please continue.

David Bailey:  Great.  Thank you.

               Well I would  just want to thank  everybody  for some very good
               questions.  Before  I  close  up the  call  I'd  just  like  to
               emphasize  that  we look  forward  to  updating  you on the FDA
               approval  process as it goes  forward.  We clearly have work to
               do on  the  three-piece  injector  and  are  focused  upon  the
               effort.  We  believe  that  the  international   business  will
               return  to solid  growth  in Q4 and that the  growth  in the US
               will continue.

               Overall,  having  got  quarter  three  behind  us and two  huge
               milestones,  the ICL panel and the accounting  issues, I'm very
               excited  about our  future  prospects.  And we hope to see many
               of  you at  the  conferences  we're  attending  going  forward.
               Thanks very much.

Operator:      Ladies and  gentlemen,  this concludes the STAAR Surgical Third
               Quarter  2003  Results  conference  call.  If you would like to
               listen  to  a  replay  of  today's   conference,   please  dial
<PAGE>
                                                                STAAR SURGICAL
                                                        Moderator:  Doug Sherk
                                                           10-30-03/3:30 pm CT
                                                          Confirmation #555304
                                                                       Page 46

               303-590-3000  or  1-800-405-2236  and enter the access  code of
               555304.  Once  again,  if you would  like to listen to a replay
               of  today's   conference  call,  please  dial  303-590-3000  or
               1-800-405-2236  with the access  code of 555304.  Thank you for
               participating.  You may now disconnect.


                                     END



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