A resurrected from 2002 thread
modus.irrealis wrote:[...] isn't it that in two-syllable εω verbs, the ε only contracts with ε and ει, rather than saying it doesn't contract with ο and ω. [...]
Yes, indeed, this is the correct descripiton of the case. ε+ε= ει, ε+ει=ει. This is the rule with the maximal descriptive simplicity.

In all other environments, ε remains uncontracted: πλέητε, θέοιμεν, ἐπλέομεν, δεώμεθα, δεομένη, δέον...
Dives qui sapiens est...