INDEPENDENCE HOLDING CO
EXHIBIT 10.2 STOCK PURCHASE AGREEMENT
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<FILENAME>kl07045_ex10-2.txt
<DESCRIPTION>EXHIBIT 10.2 STOCK PURCHASE AGREEMENT
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                                                                    Exhibit 10.2


                            STOCK PURCHASE AGREEMENT

            AGREEMENT dated as of July 30, 2002 among Cyber Net Technologies
Limited, a British Virgin Islands corporation ("Seller") and a wholly-owned
subsidiary of Pacific Century CyberWorks Limited, a company incorporated in Hong
Kong with limited liability, and Madison Investors Corporation, a Delaware
corporation, and/or one of its Affiliates ("Buyer").

            WHEREAS:  Seller is the record and  beneficial  owner of 5,000,000
shares of common  stock,  par value  $0.01  per  share  ("Common  Stock"),  of
SoftNet Systems, Inc., a Delaware corporation ("SoftNet").

            Buyer desires to purchase from Seller, and Seller desires to sell to
Buyer, 5,000,000 shares of Common Stock for the consideration set forth in
Section 2.01.

            NOW, THEREFORE, in consideration of the premises and the mutual
representations, warranties, covenants and undertakings contained herein, and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto agree as follows:


                                   ARTICLE 1
                                   DEFINITIONS

            SECTION 1.01. Definitions. The following terms, as used herein, have
the following meanings:

            "Affiliate" means, with respect to any specified Person, any other
Person which, directly or indirectly, controls, is controlled by or is under
direct or indirect common control with, such specified Person. For the purposes
of this definition, "control" when used with respect to any Person means the
power to direct the management and policies of such Person, directly or
indirectly, whether through the ownership of voting securities, by contract or
otherwise, and the terms "affiliated," "controlling," and "controlled" have
meanings correlative to the foregoing.

            "Board of Directors" means the Board of Directors of SoftNet.

            "Closing" has the meaning assigned to it in Section 2.04.

            "Closing Date" has the meaning assigned to it in Section 2.04.

            "Conveyance  Documents" has the meaning  assigned to it in Section
2.03

            "Damages" has the meaning assigned to it in Section 8.02.

<PAGE>

            "Demand Registration Rights" means those demand registration rights
granted to Seller pursuant to the Registration Rights Agreement.

            "Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder.

            "Indemnified Party" has the meaning assigned to it in Section 8.03.

            "Indemnifying  Party" has the  meaning  assigned  to it in Section
8.03

            "Lien" means any mortgage, lien, pledge, charge, security interest
or encumbrance of any kind.

            "Material Adverse Effect" means a material adverse effect on the
condition (financial or otherwise), business, assets, tax attributes or results
of operations of Seller, Buyer or SoftNet.

            "Person" means an individual, corporation, partnership, limited
liability company, association, trust or other entity or organization, including
a government or political subdivision or an agency or instrumentality thereof.

            "Purchase Price" has the meaning assigned to it in Section 2.01.

            "Registration Rights Agreement" means that certain Registration
Rights Agreement dated October 12, 1999 between SoftNet and PCCW, a copy of
which has been furnished to Buyer.

            "Securities Act" means the Securities Act of 1933, as amended, and
the rules and regulations promulgated thereunder.

            "Seller Directors" shall have the meaning assigned to it in Section
5.01.

             "Shares" means 5,000,000 shares of Common Stock owned by Seller and
any dividends paid or payable, in cash or stock, as of the date hereof.

                                   ARTICLE 2
                                PURCHASE AND SALE

            SECTION 2.01. Purchase and Sale. Subject to the terms and conditions
hereof, upon the Closing, Seller shall sell, transfer, convey, assign and
deliver to Buyer, free and clear of all Liens, and Buyer shall purchase and
accept from Seller, all of Seller's right, title and interest in, to and under
the Shares. The aggregate purchase price (the "Purchase Price") for the Shares
is $15,000,000 in cash, which represents a per share price of $3.00. The
Purchase Price shall be paid as provided in Section 2.02.

            SECTION 2.02. Payments by Buyer. Subject to the terms and conditions
hereof, upon the Closing, Buyer shall deliver to Seller the Purchase Price in
immediately

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<PAGE>

available funds by wire transfer to an account of Seller or other Person (on
Seller's behalf) as designated by Seller by written notice to the Buyer.

            SECTION 2.03. Delivery of Shares by Seller.
                          ----------------------------

            Subject to the terms and conditions hereof, upon the Closing, Seller
shall deliver to Buyer certificates for the Shares and such other deeds,
endorsements, assignments and other good and sufficient instruments of
conveyance and transfer, in form reasonably satisfactory to Buyer as Buyer may
request or as may be otherwise necessary to vest in Buyer all the right, title
and interest of Seller in, to or under any or all of the Shares, free and clear
of all Liens (collectively, the "Conveyance Documents"). The Shares currently
bear a restrictive legend and Seller makes no representation regarding the
removal thereof following the sale.

SECTION 2.04. Closing. The closing (the "Closing") of the purchase and sale of
the Shares hereunder shall take place at the offices of Kramer Levin Naftalis &
Frankel LLP, 919 Third Avenue, New York, New York 10022, on the date hereof
(such date and time, the "Closing Date").


                                   ARTICLE 3
                    REPRESENTATIONS AND WARRANTIES OF SELLER

            Seller represents and warrants to Buyer as of the date hereof that:

            SECTION 3.01. Ownership. Seller owns, of record and beneficially,
and has good, valid and marketable title to and the right to transfer all of the
Shares, free and clear of all Liens. Other than as set forth in the Registration
Rights Agreement and the certain Assignment Agreement between PCCW and Seller
dated July 16, 2002, Seller is not subject to any agreement, contract, voting
trust or understanding with regard to the Shares.

            SECTION 3.02. Corporate Existence and Power. Seller is duly formed,
validly existing and in good standing under the laws of its jurisdiction of
formation.

            SECTION 3.03. Corporate Authorization. The execution, delivery and
performance of this Agreement and the Conveyance Documents by Seller is within
Seller's corporate powers and have been duly authorized by all necessary
corporate action on the part of Seller. Seller has duly authorized the
execution, delivery and performance of this Agreement and the Conveyance
Documents. This Agreement and the Conveyance Documents have been duly executed
and delivered by Seller and (assuming that this Agreement and the Conveyance
Documents have been duly authorized, executed and delivered by Buyer) constitute
legal, valid and binding obligations of Seller, enforceable against Seller in
accordance with their terms, except (a) as such enforcement is limited by
bankruptcy, insolvency and other similar laws affecting the enforcement of
creditors' rights generally and (b) for limitations imposed by general
principles of equity.

            SECTION 3.04. Authorization. The execution, delivery and performance
of this Agreement and the Conveyance Documents by Seller requires no action by
or in respect of, or filing with, any governmental or non-governmental body,
agency, official or authority other

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<PAGE>

than (i) compliance with any applicable requirements of the Exchange Act; (ii)
compliance with any applicable requirements of the Securities Act; and (iii)
other filings or notifications that are immaterial to the consummation of the
transactions contemplated hereby.

            SECTION 3.05. Noncontravention. The execution, delivery and
performance of this Agreement by Seller does not and will not (i) violate any
provision of the governing documents of Seller, (ii) assuming compliance with
the matters referred to in Section 3.04, violate any applicable law, rule,
regulation, judgment, injunction, order or decree binding upon Seller, other
than violations that would not have a Material Adverse Effect, or (iii) result
in the creation or imposition of any Lien on the Shares.

            SECTION 3.06. Finders' Fees. There is no investment banker, broker,
finder or other intermediary which has been retained by or is authorized to act
on behalf of Seller who is entitled to any fee or commission from Buyer in
connection with the transactions contemplated by this Agreement.

            SECTION 3.07. Registration Rights. Seller has not exercised any of
its Demand Registration Rights.

                                   ARTICLE 4
                     REPRESENTATIONS AND WARRANTIES OF BUYER

            Buyer represents and warrants to Seller as of the date hereof that:

            SECTION 4.01. Existence and Power. Buyer is a corporation duly
formed, validly existing and in good standing under the laws of its jurisdiction
of formation.

            SECTION 4.02. Corporate Authorization. The execution, delivery and
performance of this Agreement and the Conveyance Documents by Buyer is within
Buyer's corporate powers and have been duly authorized by all necessary
corporate action on the part of Buyer. Buyer has duly authorized the execution,
delivery and performance of this Agreement and the Conveyance Documents. This
Agreement and the Conveyance Documents have been duly executed and delivered by
Buyer and (assuming that this Agreement and the Conveyance Documents have been
duly authorized, executed and delivered by Seller) constitute legal, valid and
binding obligations of Buyer, enforceable against Buyer in accordance with their
terms, except (a) as such enforcement is limited by bankruptcy, insolvency and
other similar laws affecting the enforcement of creditors' rights generally and
(b) for limitations imposed by general principles of equity.

            SECTION 4.03. Authorization. The execution, delivery and performance
of this Agreement and the Conveyance Documents by Buyer requires no action by or
in respect of, or filing with, any governmental or non-governmental body,
agency, official or authority other than (i) compliance with any applicable
requirements of the Exchange Act; (ii) compliance with any applicable
requirements of the Securities Act; and (iii) other filings or notifications
that are immaterial to the consummation of the transactions contemplated hereby.

            SECTION 4.04. Noncontravention. The execution, delivery and
performance of this Agreement by Buyer does not and will not (i) violate any
provision of the governing

                                       4
<PAGE>

documents of Buyer or (ii) assuming compliance with the matters referred to in
Section 4.03, violate any applicable law, rule, regulation, judgment,
injunction, order or decree binding upon the Buyer, other than violations that
would not have a Material Adverse Effect.

            SECTION 4.05. Investment Experience of Buyer. Buyer (either alone or
together with its advisors) has sufficient knowledge and experience in financial
and business matters so as to be capable of evaluating the merits and risks of
its investment in the Shares and is capable of bearing the economic risks of
such investment. Buyer has been afforded access to all information deemed by it
to be necessary, and has been given an opportunity to ask all necessary
questions of SoftNet's management, in connection with its decision to acquire
the Shares. Buyer is purchasing the Shares for investment for its own account
and not with a view to, or for sale in connection with, any distribution
thereof.

            SECTION 4.06. Litigation. There is no action, suit, investigation or
proceeding pending against, or to the knowledge of Buyer threatened against or
affecting, Buyer before any court or arbitrator or any governmental body, agency
or official which in any manner challenges or seeks to prevent, enjoin, alter or
materially delay the transactions contemplated by this Agreement.

            SECTION 4.07. Finders' Fees. There is no investment banker, broker,
finder or other intermediary which has been retained by or is authorized to act
on behalf of Buyer who might be entitled to any fee or commission from Seller or
any of their Affiliates upon consummation of the transactions contemplated by
this Agreement.

                                   ARTICLE 5
                               COVENANTS OF SELLER

            Seller agrees that:

            SECTION 5.01. Resignation of Seller Appointed Directors; Designation
of Successors. The two members of the Board of Directors previously appointed by
Seller ("Seller Directors") shall resign from the Board of Directors, effective
upon the Closing.


                                   ARTICLE 6
                          COVENANTS OF SELLER AND BUYER

            SECTION 6.01. Reasonable Best Efforts; Further Assurances. At, and
from time to time after the Closing Date, at the request of any party hereto but
without further consideration, each other party hereto will execute and deliver
such other instruments of conveyance, assignment, transfer, and delivery and
take such other action as such requesting Person reasonably may request in order
more effectively to effectuate the transactions contemplated by this Agreement,
provided that no Person complying with any such request shall be obligated to
incur any cost or expense in connection therewith.

            SECTION 6.02. Certain Filings. At, and from time to time after the
Closing, Seller and the Buyer shall cooperate with one another (i) in
determining whether any action by or in respect of, or filing with, any
governmental body, agency, official or authority is required, or

                                       5
<PAGE>

any actions, consents, approvals or waivers are required to be obtained from
parties to any material contracts, in connection with the consummation of the
transactions contemplated by this Agreement and (ii) in taking such actions or
making any such filings, furnishing information required in connection therewith
and seeking timely to obtain any such actions, consents, approvals or waivers.


                                   ARTICLE 7
                              CLOSING DELIVERABLES

            SECTION 7.01. Closing Deliverables. The following documents shall be
delivered at the Closing:

            (a) Seller shall deliver the certificates for the Shares and the
Conveyance Documents against payment in full of the Purchase Price in accordance
with Sections 2.01 and 2.02.

            SECTION 7.02. Closing Activities. The following activities shall
occur contemporaneously with or prior to the Closing.

            (a) The two Seller Directors shall have resigned their positions as
members of the Board of Directors.

                                   ARTICLE 8
                            SURVIVAL; INDEMNIFICATION

            SECTION 8.01. Survival of Representation and Warranties. All
representations and warranties contained in this Agreement and all claims with
respect thereto shall terminate upon the expiration of 18 months after the
Closing Date, except that the representations and warranties contained in
Sections 3.01, 3.02, 3.03, 4.01, 4.02 and 4.03 shall survive indefinitely.
Notwithstanding the preceding sentence, any covenant, agreement, representation
or warranty in respect of which indemnity may be sought under this Agreement
shall survive the time at which it would otherwise terminate pursuant to the
preceding sentence, if notice of the inaccuracy or breach thereof giving rise to
such right of indemnity shall have been given to the party against whom such
indemnity may be sought prior to such time.

            SECTION 8.02. Indemnification. (a) Seller hereby indemnifies Buyer
against and agrees to hold Buyer harmless from any and all damage, loss,
liability and expense (including, without limitation, reasonable expenses of
investigation and reasonable attorneys' fees and expenses in connection with any
action, suit or proceeding) ("Damages") incurred or suffered by Buyer arising
out of any misrepresentation or breach of warranty, covenant or agreement made
or to be performed by Seller pursuant to this Agreement.

            (b) Buyer hereby indemnifies Seller against and agrees to hold
Seller harmless from any and all Damages incurred or suffered by Seller arising
out of any misrepresentation or breach of warranty, covenant or agreement made
or to be performed by Buyer pursuant to this Agreement.

                                       6
<PAGE>

            SECTION 8.03. Procedures. The party seeking indemnification under
Section 8.02 (the "Indemnified Party") agrees to give prompt notice to the party
against whom indemnity is sought (the "Indemnifying Party") of the assertion of
any claim, or the commencement of any suit, action or proceeding in respect of
which indemnity may be sought under such Section. The Indemnifying Party may at
the request of the Indemnified Party participate in and control the defense of
any such suit, action or proceeding at its own expense. The Indemnifying Party
shall not be liable under Section 8.02 for any settlement effected without its
consent of any claim, litigation or proceeding in respect of which indemnity may
be sought hereunder.

            SECTION 8.04. Inspections; No Other Representations. Buyer is an
informed and sophisticated purchaser, and has undertaken such investigation and
has been provided with and has evaluated such documents and information as it
has deemed necessary to enable it to make an informed and intelligent decision
with respect to the execution, delivery and performance of this Agreement. Buyer
agrees to accept the Shares based upon its own inspection, examination and
determination with respect thereto as to all matters, and without reliance upon
any express or implied representations or warranties of any nature made by or on
behalf of or imputed to Seller, except as expressly set forth in this Agreement.
Without limiting the generality of the foregoing, Buyer acknowledges that Seller
makes no representation or warranty with respect to (i) any projections,
estimates or budgets delivered to or made available to Buyer of future revenues,
future results of operations (or any component thereof), future cash flows or
future financial condition (or any component thereof) of SoftNet or the future
business and operations of SoftNet or (ii) any other information or documents
made available to Buyer or its counsel, accountants or advisors with respect to
SoftNet and its subsidiaries or their respective businesses or operations,
except as expressly set forth in this Agreement.

            SECTION 8.05. Exclusivity. Except as specifically set forth in this
Agreement and except in the case of fraud, effective as of the Closing, Buyer
waives any rights and claims Buyer may have against Seller, whether in law or in
equity, relating to Seller or the Shares or the transactions contemplated
hereby. The rights and claims waived by Buyer include, without limitation,
claims for breach of contract, breach of representation or warranty, negligent
misrepresentation and all other claims for breach of duty. After the Closing,
Section 8.02 will provide the exclusive remedy for any misrepresentation, breach
of warranty, covenant or other agreement or other claim arising out of this
Agreement or the transactions contemplated hereby, except in the case of fraud.

                                   ARTICLE 9
                                  MISCELLANEOUS

            SECTION 9.01. Notices. All notices, requests and other
communications to any party hereunder shall be in writing and shall be deemed
duly given, effective (i) three Business Days later, if sent by registered or
certified mail, return receipt requested, postage prepaid, (ii) when sent if
sent by telecopier or fax, provided that the telecopy or fax is promptly
confirmed by telephone confirmation thereof, (iii) when served, if delivered
personally to the intended recipient, and (iv) one Business Day later, if sent
by overnight delivery via a national courier service, and in each case,
addressed,

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<PAGE>

if to Seller, to:

      Cyber Net Technologies Limited
      39th Floor, PCCW Tower, TaiKoo Place
      979 King's Road, Quarry Bay, Hong Kong
      Attention: Company Secretary
      Fax:  (852) 2962-5725

with a copy to:

      Davis Polk & Wardwell
      1600 El Camino Real
      Menlo Park, California 94025
      Attention: Daniel G. Kelly, Jr.
      Fax:  (650) 752-3601

if to Buyer, to

      Independence Holding Company
      96 Cummings Point Road
      Stamford, Connecticut 06902
      Attention: David Kettig
      Fax:  (203) 348-3103

with a copy to:

      Kramer Levin Naftalis & Frankel LLP
      919 Third Avenue
      New York, New York 10022
      Attention: Ezra G. Levin
      Fax: (212) 715-8227

Any party may change the address to which notices or other communications
hereunder are to be delivered by giving the other party notice in the manner
herein set forth.

            SECTION 9.02. Amendments and Waivers. Any provision of this
Agreement may be amended or waived if, but only if, such amendment or waiver is
in writing and is signed, in the case of an amendment, by each party to this
Agreement, or in the case of a waiver, by the party against whom the waiver is
to be effective. No failure or delay by any party in exercising any right, power
or privilege hereunder shall operate as a waiver thereof nor shall any single or
partial exercise thereof preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. The rights and remedies herein
provided shall be cumulative.

            SECTION 9.03. Expenses. All costs and expenses incurred in
connection with this Agreement shall be paid by the party incurring such cost or
expense.

            SECTION 9.04. Governing Law. This Agreement shall be governed by and
construed in accordance with the law of the State of New York, without regard to
the conflicts of law rules of such state.

                                       8
<PAGE>

            SECTION 9.05. Counterparts; Third Party Beneficiaries. This
Agreement may be signed in any number of counterparts, each of which shall be an
original, with the same effect as if the signatures thereto and hereto were upon
the same instrument. This Agreement shall become effective when each party
hereto shall have received a counterpart hereof signed by the other party
hereto. No provision of this Agreement is intended to confer upon any Person
other than the parties hereto any rights or remedies hereunder, except for those
rights conferrable to other Persons under the Registration Rights Agreement.

            SECTION 9.06. Entire Agreement. This Agreement constitutes the
entire agreement between the parties with respect to the subject matter of this
Agreement and supersedes all prior agreements and understandings, both oral and
written, between the parties with respect to the subject matter of this
Agreement.

            SECTION 9.07. Captions. The captions herein are included for
convenience of reference only and shall be ignored in the construction or
interpretation hereof.

            SECTION 9.08. Severability. The provisions of this Agreement shall
be deemed severable and the invalidity or unenforceability of any provision
shall not affect the validity or enforceability of the other provisions hereof.
If any provision of this Agreement, or the application thereof to any person or
entity or any circumstance, is invalid or unenforceable, (a) a suitable and
equitable provision shall be substituted therefor in order to carry out, so far
as may be valid and enforceable, the intent and purpose of such invalid or
unenforceable provision and (b) the remainder of this Agreement and the
application of such provision to other persons, entities or circumstances shall
not be affected by such invalidity or unenforceability, nor shall such
invalidity or unenforceability affect the validity or enforceability of such
provision, or the application thereof, in any other jurisdiction.

            SECTION 9.09. Specific Performance. The parties hereto agree that
the remedy at law for any breach of this Agreement will be inadequate and that
any party by whom this Agreement is enforceable shall be entitled to specific
performance in addition to any other appropriate relief or remedy. Such party
may, in its sole discretion, apply to a court of competition jurisdiction for
specific performance or injunctive or such other relief as such court may deem
just and proper in order to enforce this Agreement or prevent any violation
hereof and, to the extent permitted by applicable law, each party waives any
objection to the imposition of such relief.

            SECTION 9.10. No Recourse. Notwithstanding any of the terms or
provisions of this Agreement, (i) Seller agrees that neither it nor any person
acting on its behalf may assert any claims or cause of action against any
officer, director, partner, member of the Buyer or any of its Affiliates in
connection with or arising out of this Agreement or the transactions
contemplated hereby (ii) the Buyer agrees that neither it nor any person acting
on its behalf may assert any claims or cause of action against any officer,
director, partner, member or stockholder of Seller or any of its Affiliates
(including in their capacity as directors, or its capacity as a shareholder, of
SoftNet) in connection with or arising out of this Agreement or the transactions
contemplated hereby.


                                       9

<PAGE>


      IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.


                                         MADISON INVESTORS CORPORATION


                                         By: _______________________________
                                             Name:
                                             Title:


                                         CYBER NET TECHNOLOGIES LIMITED


                                         By: _______________________________
                                             Name:
                                             Title:




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