Bausch & Lomb Incorporated and Consolidated Subsidiaries - Page 16

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          finished sunglasses that it produced and sold.  Every different             
          type of finished sunglass product made by B&L was assigned a                
          different SKU and represented a separate inventory item.  Any               
          variation in the sunglasses caused them to be assigned a dif-               
          ferent SKU.  Thus, for example, if two pairs of large metals                
          contained different colored lenses, or two pairs of Wayfarers               
          were made with different colors of plastic, they were assigned              
          different SKUs even though they were identical in every other               
          respect.                                                                    
               Prior to and during the years at issue, B&L's primary                  
          facilities for producing sunglasses were located in Rochester.              
          B&L performed both parts fabrication and assembly in Rochester.             
          B&L treated parts fabrication and assembly as separate operations           
          and, regardless of location, considered its assembly facilities             
          as customers of its parts fabrication facilities.                           
              For all relevant periods until sometime in 1986, B&L pro-              
          duced the glass lenses for its Ray-Ban sunglasses in its glass              
          plant in Rochester (glass plant).  The glass plant used a large             
          glass tank capable of being subjected to extreme heat to turn               
          sand and oxides into a molten material that could be pressed into           
          shape for use as lenses in Ray-Ban sunglasses.  Because plastic             
          lenses had taken over the market for prescription eyeglasses by             
          1986, the glass plant was not commercially viable and was closed.           
          B&L licensed its glass lens-making technology to Schott Glass               





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