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Exhibit 10.1
 
AGREEMENT AND PLAN OF MERGER
 
 
BY AND AMONG

 
TEGAL CORPORATION,
 
 
CLBR ACQUISITION CORP.,
 
 
COLLABRX, INC.
 
 
and
 
 
COMMERCENET,
AS STOCKHOLDERS’ REPRESENTATIVE
 
 
 
 
Dated as of June 29, 2012
 
 
 

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AGREEMENT AND PLAN OF MERGER
 
AGREEMENT AND PLAN OF MERGER, dated as of June 29, 2012 (this “Agreement”), by
and among Tegal Corporation, a Delaware corporation (“Parent”), CLBR Acquisition
Corp., a Delaware corporation and a direct wholly owned subsidiary of Parent
(“Merger Sub”), CollabRx, Inc., a Delaware corporation (the “Company”), and
CommerceNet, as Stockholders’ Representative.
 
WHEREAS, the respective Boards of Directors of Parent, Merger Sub and the
Company have approved and declared advisable the merger of Merger Sub with and
into the Company (the “Merger”) upon the terms and subject to the conditions of
this Agreement and in accordance with the General Corporation Law of the State
of Delaware (“Delaware Law”) and, as applicable, the Corporations Code of the
State of California (“California Law”); and
 
WHEREAS, the respective Boards of Directors of Parent and the Company have
determined that the Merger is in furtherance of, and consistent with, their
respective business strategies and is in the best interest of their respective
stockholders, and Parent has approved this Agreement and the Merger as the sole
stockholder of Merger Sub;
 
WHEREAS, for federal income tax purposes, it is intended that the Merger shall
qualify as a reorganization within the meaning of Section 368(a) of the Internal
Revenue Code of 1986, as amended (the “Code”); and
 
WHEREAS, the Company will use its commercially reasonable efforts to obtain and
deliver to Parent promptly following execution and delivery of this Agreement
one or more irrevocable consents (“Stockholder Consents”) of the holders of the
Company Capital Stock representing the Requisite Stockholder Approval.
 
NOW, THEREFORE, in consideration of the foregoing and the respective
representations, warranties, covenants and agreements set forth in this
Agreement and intending to be legally bound hereby, the parties hereto agree as
follows:
 
Article 1.
The Merger
 
Section 1.1         The Merger.  Upon the terms and subject to satisfaction or
waiver of the conditions set forth in this Agreement, and in accordance with
Delaware Law, Merger Sub, at the Effective Time, shall be merged with and into
the Company.  As a result of the Merger, the separate corporate existence of
Merger Sub shall cease and the Company shall continue as the surviving
corporation of the Merger (the “Surviving Corporation”).
 
Section 1.2         Effective Time.  As soon as practicable after the
satisfaction or, if permissible, waiver of the conditions set forth in Article
6, the parties hereto shall cause the Merger to be consummated by filing a
certificate of merger (the “Certificate of Merger”) with the Secretary of State
of the State of Delaware, in such form as required by, and executed in
accordance with the relevant provisions of, Delaware Law (the date and time of
such filing, or if another date and time is specified in such filing, such
specified date and time, being the “Effective Time”).
 
 
 

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Section 1.3         Effect of the Merger.  At the Effective Time, the effect of
the Merger shall be as provided in the applicable provisions of Delaware
Law.  Without limiting the generality of the foregoing, at the Effective Time,
except as otherwise provided herein, all the property, rights, privileges,
powers and franchises of the Company and Merger Sub shall vest in the Surviving
Corporation, and all debts, liabilities and duties of the Company and Merger Sub
shall become the debts, liabilities and duties of the Surviving Corporation.
 
Section 1.4         Certificate of Incorporation; Bylaws.  At the Effective
Time, the Certificate of Incorporation and the Bylaws of the Surviving
Corporation shall be amended in their entirety to contain the provisions set
forth in the Certificate of Incorporation and the Bylaws of Merger Sub, each as
in effect immediately prior to the Effective Time.
 
Section 1.5          Directors and Officers.  The directors of Merger Sub
immediately prior to the Effective Time shall be the initial directors of the
Surviving Corporation, each to hold office in accordance with the Certificate of
Incorporation and Bylaws of the Surviving Corporation.  The officers of Merger
Sub immediately prior to the Effective Time shall be the initial officers of the
Surviving Corporation, each to hold office in accordance with the Certificate of
Incorporation and Bylaws of the Surviving Corporation.
 
Article 2.
Conversion of Securities; Exchange of Certificates
 
Section 2.1         Conversion of Securities.  At the Effective Time, by virtue
of the Merger and without any action on the part of Merger Sub, the Company or
the holders of any of the following securities:
 
Section 2.1.1        Conversion Generally.  Each share of Series 1 Preferred
Stock, par value $0.001 per share, of the Company (“Company Preferred Stock”)
issued and outstanding immediately prior to the Effective Time (other than any
Dissenting Shares and any shares of Company Preferred Stock to be canceled
pursuant to Section 2.1.3), shall be converted, subject to Section 2.3.5, into
the right to receive that fraction of a share of common stock of Parent, par
value $0.01 per share (“Parent Common Stock”), with a Fair Market Value equal to
the Preferred Liquidation Preference plus the Remainder Per Share Amount, if any
(the “Preferred Exchange Ratio”), including the associated rights of the Parent
(the “Parent Rights”) pursuant to the Shareholder Rights Agreement, dated April
13, 2011, between Parent and Registrar and Transfer Company, as Rights
Agent.  Each share of common stock, par value $0.001 per share, of the Company
(“Company Common Stock” and, together with Company Preferred Stock, “Company
Capital Stock”) issued and outstanding immediately prior to the Effective Time
(other than any Dissenting Shares and any shares of Company Common Stock to be
canceled pursuant to Section 2.1.3), shall be converted, subject to Section
2.3.5, into the right to receive that fraction of a share of Parent Common Stock
with a Fair Market Value equal to the Remainder Per Share Amount, if any (the
“Common Exchange Ratio”), including the associated Parent Rights. All such
shares of Company Capital Stock shall no longer be outstanding and shall
automatically be canceled and retired and shall cease to exist, and each
certificate previously representing any such shares shall thereafter represent
the right to receive a certificate representing the shares of Parent Common
Stock into which such Company Capital Stock was converted in the
Merger.  Certificates previously representing shares of Company Capital Stock
shall be exchanged for certificates representing whole shares of Parent Common
Stock issued in consideration therefor upon the surrender of such certificates
in accordance with the provisions of Section 2.3, without interest.  No
fractional share of Parent Common Stock shall be issued, and in lieu thereof, a
cash payment shall be made pursuant to Section 2.3.5 hereof.
 
 
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Section 2.1.2         Holdback.
 
Section 2.1.2.1       Parent shall hold back twenty percent (20%) of the number
of shares of Parent Common Stock otherwise issuable pursuant to this Section
2.1, rounded down to a whole number of shares on a holder-by-holder basis (the
“Holdback Shares”), provided that the number of shares of Parent Common Stock
constituting the Holdback Shares otherwise issuable to the Company may be
reduced in accordance with the provisions of Section 8.4.  The Holdback Shares
shall be withheld from the shares of Parent Common Stock otherwise deliverable
to the Company Stockholders and held in escrow by Parent subject to the
provisions of this Agreement.  The Holdback Shares shall be delivered to the
Company Stockholders promptly following the one-year anniversary of the
Effective Time (the “Holdback Termination Date”).
 
Section 2.1.2.2       Parent hereby agrees that (A) the Holdback Shares shall
appear as issued and outstanding on Parent’s balance sheet and shall be legally
outstanding under applicable law; (B) any dividends paid on the Holdback Shares
shall be distributed currently to the Company Stockholder in whose name such
Holdback Shares are registered; and (C) all voting rights of the Holdback Shares
shall be exercisable by or on behalf of the Company Stockholder in whose name
such Holdback Shares are registered or his, her or its authorized agent.
 
Section 2.1.3         Cancellation of Certain Shares.  Each share of Company
Capital Stock held by Parent, Merger Sub, any wholly-owned subsidiary of Parent
or Merger Sub or in the treasury of the Company immediately prior to the
Effective Time shall be canceled and extinguished without any conversion thereof
and no payment shall be made with respect thereto.
 
Section 2.1.4        Merger Sub.  Each share of common stock, par value $0.01
per share, of Merger Sub issued and outstanding immediately prior to the
Effective Time shall be converted into and be exchanged for one newly and
validly issued, fully paid and nonassessable share of common stock of the
Surviving Corporation.
 
Section 2.1.5        Change in Shares.  If between the date of this Agreement
and the Effective Time the outstanding shares of Parent Common Stock, Company
Preferred Stock or Company Common Stock shall have been changed into a different
number of shares or a different class, by reason of any stock dividend,
subdivision, reclassification, recapitalization, split, combination or exchange
of shares, the Preferred Exchange Ratio and/or the Common Exchange Ratio, as the
case may be, shall be correspondingly adjusted to reflect such stock dividend,
subdivision, reclassification, recapitalization, split, combination or exchange
of shares.
 
 
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Section 2.2         Dissenters’ Rights.  Notwithstanding anything contained
herein to the contrary, any Dissenting Share shall not be converted into the
right to receive Parent Common Stock provided for in Section 2.1, but shall
instead be converted into the right to receive such consideration as may be
determined to be due with respect to any such Dissenting Share pursuant to
Section 262 of Delaware Law or Chapter 13 of California Law, as
applicable.  Each holder of Dissenting Shares who, pursuant to the provisions of
Delaware Law or California Law, becomes entitled to payment thereunder for such
shares shall receive payment therefor in accordance with Delaware Law or
California Law (but only after the value therefor shall have been agreed upon or
finally determined pursuant to such provisions).  If, after the Effective Time,
any Dissenting Share shall lose its status as a Dissenting Share, then any such
share shall immediately be converted into the right to receive the fraction of a
share of Parent Common Stock issuable pursuant to Section 2.1 in respect of such
share as if such share never had been a Dissenting Share, and Parent shall
deliver, or cause to be delivered in accordance with the terms of this
Agreement, to the holder thereof, at (or as promptly as reasonably practicable
after) the applicable time or times specified in Section 2.3 following the
satisfaction of the applicable conditions set forth in Section 2.3.2, the number
of shares of Parent Common Stock to which such holder would be entitled in
respect thereof under Section 2.1 as if such share never had been a Dissenting
Share.  The Company shall give Parent (i) prompt notice of any demands for
appraisal received by the Company, withdrawals of such demands, and any other
instruments served pursuant to Delaware Law or California Law and received by
the Company and (ii) the right to direct all negotiations and proceedings with
respect to demands for appraisal under Delaware Law or California Law.  The
Company shall not, except with the prior written consent of Parent, voluntarily
make any payment or offer to make any payment with respect to, or settle or
offer to settle, any claim or demand in respect of any Dissenting Shares.
 
Section 2.3          Exchange of Certificates.
 
Section 2.3.1         Exchange Agent.  As of the Effective Time, Parent shall
deposit, or shall cause to be deposited, with Registrar and Transfer Company or
another person designated by Parent and reasonably satisfactory to the Company
(the “Exchange Agent”), for the benefit of the holders of shares of Company
Capital Stock, for exchange in accordance with this Article 2, through the
Exchange Agent, certificates representing the shares of Parent Common Stock
(such certificates for shares of Parent Common Stock, together with cash in lieu
of fractional shares and any dividends or distributions with respect thereto,
being hereinafter referred to as the “Exchange Fund”) issuable pursuant to
Section 2.1 in exchange for outstanding shares of Company Capital Stock.  The
Exchange Agent shall, pursuant to irrevocable instructions, deliver the Parent
Common Stock contemplated to be issued pursuant to Section 2.1 out of the
Exchange Fund.
 
 
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Section 2.3.2         Exchange Procedures.  Promptly after the Effective Time,
Parent shall instruct the Exchange Agent to mail to each holder of record of a
certificate or certificates which immediately prior to the Effective Time
represented outstanding shares of Company Capital Stock (the “Certificates”) (A)
a letter of transmittal (which shall specify that delivery shall be effected,
and risk of loss and title to the Certificates shall pass, only upon proper
delivery of the Certificates to the Exchange Agent and shall be in customary
form), (B) a copy of the Stockholders Agreement and (C) instructions for use in
effecting the surrender of the Certificates in exchange for certificates
representing shares of Parent Common Stock.  Upon surrender of a Certificate for
cancellation to the Exchange Agent together with such letter of transmittal,
properly completed and duly executed, an executed counterpart signature page to
the Stockholders Agreement and such other documents as may be required pursuant
to such instructions, the holder of such Certificate shall be entitled to
receive in exchange therefor a certificate representing that number of whole
shares of Parent Common Stock which such holder has the right to receive in
respect of the shares of Company Capital Stock formerly represented by such
Certificate (after taking into account all shares of Company Capital Stock then
held by such holder) less such holders’ pro rata portion of the Holdback Shares,
cash in lieu of fractional shares of Parent Common Stock to which such holder is
entitled pursuant to Section 2.3.5 and any dividends or other distributions to
which such holder is entitled pursuant to Section 2.3.3, and the Certificate so
surrendered shall forthwith be canceled.  No interest will be paid or accrued on
any cash in lieu of fractional shares or on any unpaid dividends and
distributions payable to holders of Certificates.  In the event of a transfer of
ownership of shares of Company Capital Stock which is not registered in the
transfer records of the Company, a certificate representing the proper number of
shares of Parent Common Stock may be issued to a transferee if the Certificate
representing such shares of Company Capital Stock is presented to the Exchange
Agent, accompanied by all documents required to evidence and effect such
transfer and by evidence that any applicable stock transfer taxes have been
paid.  Until surrendered as contemplated by this Section 2.3, each Certificate
shall be deemed at any time after the Effective Time to represent only the right
to receive upon such surrender the certificate representing shares of Parent
Common Stock, cash in lieu of any fractional shares of Parent Common Stock to
which such holder is entitled pursuant to Section 2.3.5 and any dividends or
other distributions to which such holder is entitled pursuant to Section 2.3.3.
 
Section 2.3.3       Distributions with Respect to Unexchanged Shares of Parent
Common Stock.  No dividends or other distributions declared or made after the
Effective Time with respect to Parent Common Stock with a record date after the
Effective Time shall be paid to the holder of any unsurrendered Certificate with
respect to the shares of Parent Common Stock represented thereby, and no cash
payment in lieu of fractional shares shall be paid to any such holder pursuant
to Section 2.3.5, unless and until the holder of such Certificate shall
surrender such Certificate.  Subject to the effect of escheat, tax or other
applicable Laws, following surrender of any such Certificate, there shall be
paid to the holder of the certificates representing whole shares of Parent
Common Stock issued in exchange therefor, without interest, (A) promptly, the
amount of any cash payable with respect to a fractional share of Parent Common
Stock to which such holder is entitled pursuant to Section 2.3.5 and the amount
of dividends or other distributions with a record date after the Effective Time
theretofore paid with respect to such whole shares of Parent Common Stock and
(B) at the appropriate payment date, the amount of dividends or other
distributions, with a record date after the Effective Time but prior to
surrender and a payment date occurring after surrender, payable with respect to
such whole shares of Parent Common Stock.
 
Section 2.3.4        Further Rights in Company Common Stock.  All shares of
Parent Common Stock issued upon conversion of the shares of Company Common Stock
in accordance with the terms hereof (including any cash paid pursuant to Section
2.3.3 or Section 2.3.5) shall be deemed to have been issued in full satisfaction
of all rights pertaining to such shares of Company Capital Stock.
 
 
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Section 2.3.5        Fractional Shares.  No certificates or scrip representing
fractional shares of Parent Common Stock shall be issued upon the surrender for
exchange of Certificates, no dividend or distribution with respect to Parent
Common Stock shall be payable on or with respect to any fractional share and
such fractional share interests will not entitle the owner thereof to any rights
of a stockholder of Parent.  In lieu of a fractional share of Parent Common
Stock, each holder of a certificate shall be entitled to receive an amount in
cash equal to the Fair Market Value of such fractional share of Parent Common
Stock.
 
Section 2.3.6         Termination of Exchange Fund.  Any portion of the Exchange
Fund which remains undistributed to the holders of Company Capital Stock for six
months after the Effective Time shall be delivered to Parent upon demand, and
any holders of Company Capital Stock who have not theretofore complied with this
Article 2 shall thereafter look only to Parent for the shares of Parent Common
Stock, any cash in lieu of fractional shares of Parent Common Stock to which
they are entitled pursuant to Section 2.3.5 and any dividends or other
distributions with respect to Parent Common Stock to which they are entitled
pursuant to Section 2.3.3, in each case, without any interest thereon.
 
Section 2.3.7         No Liability.  Neither Parent nor the Surviving
Corporation shall be liable to any holder of shares of Company Capital Stock for
any shares of Parent Common Stock (or dividends or distributions with respect
thereto) or cash from the Exchange Fund delivered to a public official pursuant
to any abandoned property, escheat or similar Law.
 
Section 2.3.8         Lost Certificates.  If any Certificate shall have been
lost, stolen or destroyed, upon the making of an affidavit of that fact by the
person claiming such Certificate to be lost, stolen or destroyed and, if
required by Parent, the posting by such person of a bond, in such reasonable
amount as Parent may direct, as indemnity against any claim that may be made
against it with respect to such Certificate, the Exchange Agent will issue in
exchange for such lost, stolen or destroyed Certificate the shares of Parent
Common Stock, any cash in lieu of fractional shares of Parent Common Stock to
which the holders thereof are entitled pursuant to Section 2.3.5 and any
dividends or other distributions to which the holders thereof are entitled
pursuant to Section 2.3.3, in each case, without any interest thereon.
 
Section 2.3.9        Withholding.  Parent or the Exchange Agent shall be
entitled to deduct and withhold from the consideration otherwise payable
pursuant to this Agreement to any holder of Company Capital Stock such amounts
as Parent or the Exchange Agent are required to deduct and withhold under the
Code, or any provision of state, local or foreign tax Law, with respect to the
making of such payment.  To the extent that amounts are so withheld and properly
remitted in accordance with applicable Law by Parent or the Exchange Agent, such
withheld amounts shall be treated for all purposes of this Agreement as having
been paid to the holder of Company Capital Stock in respect of whom such
deduction and withholding was made by Parent or the Exchange Agent.
 
Section 2.4         Stock Transfer Books.  At the Effective Time, the stock
transfer books of the Company shall be closed and thereafter, there shall be no
further registration of transfers of shares of Company Capital Stock theretofore
outstanding on the records of the Company.  From and after the Effective Time,
the holders of certificates representing shares of Company Capital Stock
outstanding immediately prior to the Effective Time shall cease to have any
rights with respect to such shares of Company Capital Stock except as otherwise
provided herein or by Law.  On or after the Effective Time, any Certificates
presented to the Exchange Agent or Parent for any reason shall be converted into
the shares of Parent Common Stock, any cash in lieu of fractional shares of
Parent Common Stock to which the holders thereof are entitled pursuant to
Section 2.3.5 and any dividends or other distributions to which the holders
thereof are entitled pursuant to Section 2.3.3.
 
 
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Section 2.5         Stock Options. Prior to the Effective Time, the Company
Board shall have adopted appropriate resolutions and taken any and all other
actions necessary and appropriate to provide that each unexpired and unexercised
option to purchase shares of Company Common Stock (“Company Options”) under any
stock option plan of the Company, including the CollabRx, Inc. 2008 Stock Plan
or any other plan, agreement or arrangement, whether or not then exercisable,
shall be cancelled and cease to exist effective as of the Effective Time.
 
Section 2.6         Warrants.  Prior to the Effective time, the Company Board
shall have adopted appropriate resolutions and taken any and all other actions
necessary and appropriate to provide that each unexpired and unexercised warrant
to purchase shares of Company Capital Stock (“Company Warrants”) shall be
cancelled and cease to exist effective as of the Effective Time.
 
Section 2.7         Further Action.  If, at any time after the Effective Time,
any further action is necessary or desirable to carry out the purposes of this
Agreement and to vest the Surviving Corporation with full right, title and
interest in, to and under, and/or possession of, all assets, property, rights,
privileges, powers and franchises of the Company, the officers and directors of
the Surviving Corporation are fully authorized in the name and on behalf of the
Company or otherwise, to take all lawful action necessary or desirable to
accomplish such purpose or acts, so long as such action is not inconsistent with
this Agreement.
 
Section 2.8          Spreadsheet.  The Company shall prepare and deliver to
Parent, at least five (5) business days prior to the Effective Time, a
spreadsheet (the “Spreadsheet”), certified by an executive officer of the
Company, which shall set forth all of the following information as of
immediately prior to the Effective Time:  (a) the names of all holders of
Company Capital Stock and their respective addresses (including email addresses,
if available); (b) each Company Stockholder’s pro rata share (as a percentage
interest and number of shares) of the Closing Shares, (c) each Company
Stockholder’s pro rata share (as a percentage interest and number of shares) of
the Holdback Shares, (d) each Company Stockholder’s cash in lieu of any
fractional share of Parent Common Stock and (e) the calculation of the Preferred
Liquidation Preference and the Remainder Per Share Amount.  The Spreadsheet
shall be reasonably acceptable to Parent.
 
Section 2.9         Closing Balance Sheet.  The Company shall prepare and
deliver to Parent, at least five (5) business days prior to the Effective Time,
an estimated balance sheet of the Company as of the Effective Time in the form
set forth in Section 2.9 of the Company Disclosure Schedule (the “Estimated
Balance Sheet”), certified by the Chief Financial Officer of the Company.  The
Estimated Balance Sheet shall be prepared in accordance with GAAP applied
consistently.  Upon Parent’s request, the Company will provide to Parent and its
representatives reasonable access to all relevant books and records (in
electronic format, if available) and employees of the Company to the extent
required to complete its review of the Estimated Balance Sheet.  The Estimated
Balance Sheet shall be reasonably acceptable to Parent.
 
 
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Section 2.10       Transaction Expenses; Closing Indebtedness; Change of Control
Obligations.  The Company shall prepare and deliver to Parent, at least five (5)
business days prior to the Effective Time, (a) a statement setting forth all
Transaction Expenses not paid as of the Effective Time (the “Transaction
Expenses Statement”), together with invoices relating to all such Transaction
Expenses, (b) a statement setting forth all Indebtedness to be outstanding as of
the Effective Time (the “Closing Indebtedness Statement”), together with payoff
letters relating to all such Indebtedness and (c) a statement setting forth all
Change of Control Obligations not paid as of the Effective Time (the “Change of
Control Obligations Statement”).  Each of the Transaction Expenses Statement and
related invoices, the Closing Indebtedness Statement and related payoff letters
and the Change of Control Obligations Statement shall be (i) certified by an
executive officer of the Company, (ii) in reasonable detail and (iii) reasonably
acceptable to Parent.
 
Section 2.11       Maximum Number of Shares of Parent Common
Stock.  Notwithstanding any other provision of this Agreement to the contrary,
under no circumstances shall Parent have any obligation to issue more than an
aggregate of 236,433 shares of Parent Common Stock pursuant to this Agreement;
provided, however, that in the event Parent issues shares of capital stock to a
third party between the date hereof and the Effective Time, such number of
shares shall be increased by a number of shares necessary to make the Merger
Consideration Shares equal to fourteen percent (14%) of the outstanding shares
of capital stock of Parent immediately prior to the Effective Time (the “Merger
Consideration Shares”).
 
Article 3.
Representations and Warranties of the Company
 
Except as set forth in the Disclosure Schedule delivered by the Company to
Parent prior to the execution of this Agreement (the “Company Disclosure
Schedule”), which identifies exceptions by specific Section references, the
Company hereby represents and warrants to Parent as of the date hereof and the
Effective Time as follows (for purposes of these representations and warranties
(other than those in Sections 3.1.2, 3.3 and 3.4), the term “the Company” shall
include any subsidiaries of the Company, unless otherwise noted herein):
 
Section 3.1          Organization and Qualification; Subsidiaries.
 
Section 3.1.1         The Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware.  CC IP
Holdings LLC is a limited liability company duly organized, validly existing and
in good standing under the laws of the State of Delaware.  Each of the Company
and CC IP Holdings LLC has the requisite power and authority and all necessary
governmental approvals to own, lease and operate its properties and to carry on
its business as it is now being conducted, except where the failure to have such
approvals would not reasonably be expected to have a Company Material Adverse
Effect.  Each of the Company and CC IP Holdings LLC is duly qualified or
licensed to do business, and is in good standing, in each jurisdiction where the
character of the properties owned, leased or operated by it or the nature of its
business makes such qualification, licensing or good standing necessary, except
for such failures to be so qualified, licensed or in good standing that would
not, individually or in the aggregate, reasonably be expected to have a Company
Material Adverse Effect.  The Company is the sole member of CC IP Holdings
LLC.  Except for CC IP Holdings LLC, the Company does not own or control,
directly or indirectly, any interests in any other corporation, partnership,
trust, joint venture, limited liability company, association or other business
entity.
 
 
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Section 3.1.2         The Company is not a participant in any joint venture,
partnership or similar arrangement.
 
Section 3.2         Certificate of Incorporation and Bylaws; Corporate Books and
Records.  The copies of the Company’s Amended and Restated Certificate of
Incorporation (the “Company Certificate”) and Bylaws (the “Company Bylaws”) and
CC IP Holdings LLC’s operating agreement furnished to Parent are complete and
correct copies thereof as in effect on the date of this Agreement.  The Company
is not in violation of any of the provisions of the Company Certificate or the
Company Bylaws. CC IP Holdings LLC is not in violation of any of the provisions
of its operating agreement.  True and complete copies of all minute books of the
Company since January 1, 2009 have been made available by the Company to Parent.
 
Section 3.3         Capitalization.  The authorized capital stock of the Company
consists of 44,000,000 shares of Company Common Stock and 14,634,147 shares of
Preferred Stock, par value $0.001 per share.  As of the date of this Agreement,
(A) 8,717,526 shares of Company Common Stock (other than treasury shares) were
issued and outstanding, (B) no shares of Company Common Stock were held in the
treasury of the Company, and (C) 7,330,970 shares of Company Common Stock were
issuable (and such number was reserved for issuance) upon exercise of Company
Options outstanding as of such date.  As of the date of this Agreement, all
shares of Company Preferred Stock are designated as Series 1 Preferred Stock,
and 9,494,275 shares of Series 1 Preferred Stock are issued and
outstanding.  All of the outstanding shares of Company Capital Stock have been
duly authorized, are fully paid and nonassessable and were validly issued in
compliance with all applicable federal and state securities laws.  All of the
outstanding shares of Company Capital Stock are free of preemptive or similar
rights.  Except for Company Options to purchase not more than 7,330,970 shares
of Company Common Stock or agreements set forth in Section 3.3 of the Company
Disclosure Schedule, there are no options, warrants or other rights, agreements,
arrangements or commitments of any character to which the Company is a party or
by which the Company is bound relating to the issued or unissued capital stock
or other Equity Interests of the Company, or securities convertible into or
exchangeable or exercisable for such capital stock or other Equity Interests, or
obligating the Company to issue or sell any  shares of its capital stock or
other Equity Interests, or securities convertible into or exchangeable or
exercisable for such capital stock of, or other Equity Interests in, the
Company.  The Company has previously provided Parent with:  a true and complete
copy of the CollabRx, Inc. 2008 Stock Plan and forms of agreements used
thereunder; a true and complete list of the prices at which outstanding Company
Options may be exercised under the CollabRx, Inc. 2008 Stock Plan; as of the
date of this Agreement, the number of Company Options outstanding at each such
price; and the vesting schedule of the outstanding Company Options.  The Company
has never declared or paid dividends with respect to any shares of Company
Capital Stock.
 
 
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Section 3.4          Authority.
 
Section 3.4.1        The Company has all necessary corporate power and authority
to execute and deliver this Agreement, to perform its obligations hereunder and
to consummate the transactions contemplated by this Agreement to be consummated
by the Company.  The execution and delivery of this Agreement by the Company and
the consummation by the Company of the transactions contemplated hereby have
been duly and validly authorized by all necessary corporate action and no other
corporate proceedings on the part of the Company and no stockholder votes are
necessary to authorize this Agreement or to consummate the transactions
contemplated hereby other than, with respect to the Merger, as provided in
Section 3.21.  The Board of Directors of the Company (the “Company Board”) has
approved this Agreement, declared advisable the transactions contemplated hereby
and thereby and has directed that this Agreement and the transactions
contemplated hereby be submitted to the Company’s stockholders for
approval.  This Agreement has been duly authorized and validly executed and
delivered by the Company and constitutes a legal, valid and binding obligation
of the Company, enforceable against the Company in accordance with its terms.
 
Section 3.4.2        The Company has taken all appropriate actions so that the
restrictions on business combinations contained in Section 203 of Delaware Law
will not apply with respect to or as a result of this Agreement and the
transactions contemplated hereby and thereby, including the Merger, without any
further action on the part of the stockholders or the Company Board.  True and
complete copies of all Company Board resolutions reflecting such actions have
been previously provided to Parent.  No other state takeover statute or similar
statute or regulation is applicable to or purports to be applicable to the
Merger or any other transaction contemplated by this Agreement.
 
Section 3.5          No Conflict; Required Filings and Consents.
 
Section 3.5.1        The execution and delivery of this Agreement by the Company
does not, and the performance of this Agreement by the Company will not, (A)
(assuming, the stockholder approval set forth in Section 3.21 is obtained)
conflict with or violate any provision of the Company Certificate or Company
Bylaws, (B) assuming that all consents, approvals, authorizations and permits
described in Section 3.5.2 have been obtained and all filings and notifications
described in Section 3.5.2 have been made, conflict with or violate any Law
applicable to the Company or by which any property or asset of the Company is
bound or affected in any material respect or (C) require any consent or approval
under, result in any material breach of or any material loss of any benefit
under, constitute a change of control or default (or an event which with notice
or lapse of time or both would become a default) under or give to others any
right of termination, vesting, amendment, acceleration or cancellation of, or
result in the creation of a lien or other encumbrance on any property or asset
of the Company pursuant to, any material note, bond, mortgage, indenture,
contract, agreement, lease, license, Company Permit or other instrument or
obligation.
 
Section 3.5.2        The execution and delivery of this Agreement by the Company
does not, and the performance of this Agreement by the Company will not, require
any consent, approval, authorization or permit of, or filing with or
notification to, any Governmental Entity or any other person, except the filing
and recordation of the Certificate of Merger as required by Delaware Law.
 
 
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Section 3.6         Permits; Compliance With Law.  The Company is in possession
of all material authorizations, licenses, permits, certificates, approvals and
clearances of any Governmental Entity necessary for the Company to own, lease
and operate its properties or to carry on its business substantially as it is
being conducted as of the date of this Agreement (the “Company Permits”), and
all such Company Permits are valid, and in full force and effect.  The Company
is not in conflict with, or in default or violation of, (a) any Law applicable
to the Company or by which any property or asset of the Company is bound or
affected or (b) any Company Permit, in each case in any material respect.
 
Section 3.7         Financial Statements.  The Company has delivered to Parent
its unaudited financial statements as of December 31, 2011 and for the year then
ended (the “Annual Financial Statements”) and its unaudited financial statements
as of May 31, 2012 and for the 4-month period then ended (the “Interim Financial
Statements” and, together with the Annual Financial Statements, the “Financial
Statements”).  The Financial Statements have been prepared in accordance with
generally accepted accounting principles applied on a consistent basis
throughout the periods indicated, except that the Interim Financial Statements
may not contain all footnotes required by generally accepted accounting
principles.  The Financial Statements fairly present in all material respects
the financial condition and operating results of the Company as of the dates,
and for the periods, indicated therein, subject in the case of the Interim
Financial Statements to normal year-end audit adjustments not material in amount
or significance.  Except as set forth in the Financial Statements, the Company
has no material liabilities or obligations, contingent or otherwise, other than
(i) liabilities incurred in the ordinary course of business subsequent to May
31, 2012 and (ii) obligations under contracts and commitments incurred in the
ordinary course of business, which, in all such cases, individually and in the
aggregate would not have a Company Material Adverse Effect.  The Company
maintains a standard system of accounting established and administered in
accordance with generally accepted accounting principles.
 
Section 3.8          Absence of Certain Changes or Events.  Since May 31, 2012,
except as specifically contemplated by, or as disclosed in, this Agreement or
Section 3.8 of the Company Disclosure Schedule, the Company has conducted its
businesses in the ordinary course consistent with past practice and, since such
date, there has not been (A) any Company Material Adverse Effect or an event or
development that would, individually or in the aggregate, reasonably be expected
to have a Company Material Adverse Effect, (B) any event or development that
would, individually or in the aggregate, reasonably be expected to prevent or
materially delay the performance of this Agreement by the Company or (C) any
action taken by the Company that, if taken during the period from the date of
this Agreement through the Effective Time, would constitute a breach of Section
5.1.
 
 
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Section 3.9          Employee Benefit Plans
 
Section 3.9.1        Section 3.9.1 of the Company Disclosure Schedule sets forth
a true and complete list of each “employee benefit plan” as defined in Section
3(3) of ERISA and any other plan, policy, program, practice, agreement,
understanding or arrangement (whether written or oral) providing compensation or
other material benefits to any current or former director, officer, employee or
consultant (or to any dependent or beneficiary thereof of the Company or any
ERISA Affiliate), which are now, or were within the past 6 years, maintained,
sponsored or contributed to by the Company or any ERISA Affiliate, or under
which the Company or any ERISA Affiliate has any obligation or liability,
whether actual or contingent, including, without limitation, all incentive,
bonus, deferred compensation, vacation, holiday, cafeteria, medical, disability,
stock purchase, stock option, stock appreciation, phantom stock, restricted
stock or other stock-based compensation plans, policies, programs, practices or
arrangements (each a “Company Benefit Plan”).  Neither the Company, nor to the
Knowledge of the Company, or any ERISA Affiliate, has any express or implied
commitment, whether legally enforceable or not, to modify, change or terminate
any  Company Benefit Plan, other than with respect to a modification, change or
termination required by this Agreement or by ERISA or the Code.
 
With respect to each Company Benefit Plan, the Company has delivered to Parent
true, correct and complete copies of (A) each Company Benefit Plan (or, if not
written a written summary of its material terms), including without limitation
all plan documents, adoption agreements, trust agreements, insurance contracts
or other funding vehicles and all amendments thereto, (B) all summaries and
summary plan descriptions, including any summary of material modifications, (C)
the most recent annual report (Form 5500 series) for each Company Benefit Plan
filed with the IRS (and, if the most recent annual report is a Form 5500R, the
most recent Form 5500C filed with respect to such Company Benefit Plan), (D) the
most recent actuarial report or other financial statement relating to such
Company Benefit Plan, if any, (E) the most recent determination or opinion
letter, if any, issued by the IRS with respect to any Company Benefit Plan and
any pending request for such a determination letter, (F) the most recent
nondiscrimination tests performed under the Code (including 401(k) and 401(m)
tests) for each Company Benefit Plan, and (G) all filings made with any
Governmental Entity, including, but not limited to, any filings under the
Voluntary Compliance Resolution or Closing Agreement Program or the  Department
of Labor Delinquent Filer Program.
 
Section 3.9.2         Each Company Benefit Plan has been administered in all
material respects in accordance with both its terms and all applicable Laws,
including ERISA and the Code, and contributions required to be made under the
terms of any of the Company Benefit Plans as of the date of this Agreement have
been timely made or, if not yet due, have been properly reflected on the most
recent consolidated balance sheet filed or incorporated by reference in the
Company SEC Filings prior to the date of this Agreement.  With respect to the
Company Benefit Plans, no event has occurred and, to the Knowledge of the
Company, there exists no condition or set of circumstances in connection with
which the Company could be subject to any material liability (other than for
routine benefit liabilities) under the terms of, or with respect to, such
Company Benefit Plans, ERISA, the Code or any other applicable Law.
 
 
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Section 3.9.3        Except as disclosed on Section 3.9.3 of the Company
Disclosure Schedule:  (A) each Company Benefit Plan which is intended to qualify
under Section 401(a), Section 401(k), Section 401(m) or Section 4975(e)(6) of
the Code has either received a favorable determination, advisory or opinion
letter from the IRS as to its qualified status or still has a remaining period
of time under applicable Treasury Regulations or IRS pronouncements in which to
apply for such letter and to make any amendments necessary to obtain a favorable
determination, and each trust established in connection with any Company Benefit
Plan which is intended to be exempt from federal income taxation under Section
501(a) of the Code is so exempt, and, to the Knowledge of the Company, no fact
or event has occurred that could adversely affect the qualified status of any
such Company Benefit Plan or the exempt status of any such trust, (B) to the
Knowledge of the Company, there has been no prohibited transaction (within the
meaning of Section 406 of ERISA or Section 4975 of the Code and other than a
transaction that is exempt under a statutory or administrative exemption) with
respect to any Company Benefit Plan that could result in liability to the
Company or an ERISA Affiliate, (C) each Company Benefit Plan can be amended,
terminated or otherwise discontinued after the Effective Time in accordance with
its terms, without liability (other than (i) liability for ordinary
administrative expenses typically incurred in a termination event or (ii)
liability for the accrued benefits as of the date of such termination (if and to
the extent required by ERISA) to the extent that either there are sufficient
assets set aside in a trust or insurance contract to satisfy such liability or
such liability is reflected on the most recent consolidated balance sheet  prior
to the date of this Agreement), (D) no suit, administrative proceeding, action
or other litigation has been brought, or, to the Knowledge of the Company, is
threatened, against or with respect to any such Company Benefit Plan, including
any audit or inquiry by the IRS or United States Department of Labor (other than
routine benefits claims), (E) no Company Benefit Plan is a multiemployer pension
plan (as defined in Section 3(37) of ERISA) (“Multiemployer Plan”) or other
pension plan subject to Title IV of ERISA and none of the Company or any ERISA
Affiliate has sponsored or contributed to or been required to contribute to a
Multiemployer Plan or other pension plan subject to Title IV of ERISA, (F) no
material liability under Title IV of ERISA has been incurred by the Company or
any ERISA Affiliate that has not been satisfied in full, and no condition exists
that presents a material risk to the Company or any ERISA Affiliate of incurring
or being subject (whether primarily, jointly or secondarily) to a material
liability thereunder, (G) none of the assets of the Company or any ERISA
Affiliate is, or may reasonably be expected to become, the subject of any lien
arising under ERISA or Section 412(n) of the Code, (H) neither the Company nor
any ERISA Affiliate has any liability under ERISA Section 502(i) or (l), (I) all
tax, annual reporting and other governmental filings required by ERISA and the
Code have been timely filed with the appropriate Governmental Entity and all
notices and disclosures have been timely provided to participants, (J) all
contributions and payments to such Company Benefit Plan are deductible under
Code sections 162 or 404, (K) no amount is subject to Tax as unrelated business
taxable income under Section 511 of the Code, and (L) no excise tax could be
imposed upon the Company under Chapter 43 of the Code.
 
Section 3.9.4         With respect to each Company Benefit Plan required to be
set forth in Section 3.9.1 of the Company Disclosure Schedule that is subject to
Title IV or Part 3 of Title I of ERISA or Section 412 of the Code (other than a
Multiemployer Plan), (A) no “reportable event” (within the meaning of Section
4043 of ERISA, other than an event for which the reporting requirements have
been waived by regulations) has occurred or is expected to occur, (B) there was
not an “accumulated funding deficiency” (within the meaning of Section 302 of
ERISA or Section 412 of the Code), whether or not waived, as of the most
recently ended plan year of such Company Benefit Plan, (C) there is no “unfunded
benefit liability” (within the meaning of Section 4001(a)(18) of ERISA, but
excluding from the definition of “current value” of “assets” accrued but unpaid
contributions), (D) the Company and each ERISA Affiliate has made when due any
“required installments” within the meaning of Section 412(m) of the Code and
Section 302(e) of ERISA, whichever may apply, (E) none of the Company or any
ERISA Affiliate is required to provide security under Section 401(a)(29) of the
Code, (F) all premiums (and interest charges and penalties for late payment, if
applicable) have been paid when due to the Pension Benefit Guaranty Corporation
(“PBGC”), and (G) no filing has been made by the Company or any ERISA Affiliate
with the PBGC and no proceeding has been commenced by the PBGC to terminate any
Company Benefit Plan and no condition exists which could constitute grounds for
the termination of any such Company Benefit Plan by the PBGC.
 
 
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Section 3.9.5        Except as disclosed on Section 3.9.5 of the Company
Disclosure Schedule, with respect to each Company Benefit Plan that is a
Multiemployer Plan, (A) none of the Company or any ERISA Affiliate has incurred
any withdrawal liability under §4201 of ERISA nor does the Company or any ERISA
Affiliate expect to withdraw in a “complete withdrawal” or “partial withdrawal”
within the meaning of Section 4203 and 4205 of ERISA, (B) all contributions
required to be made to any such Company Benefit Plan have been timely made, and
(C) to the best Knowledge of the Company, no such Multiemployer Plan has been
terminated or has been in or is about to be in reorganization under ERISA so as
to result directly or indirectly in any increase in contributions under Section
4243 of ERISA or in liability contingent or otherwise to the Company or any
ERISA Affiliate.
 
Section 3.9.6        Except as set forth on Section 3.9.6 of the Company
Disclosure Schedule, no amount that could be received (whether in cash or
property or the vesting of property), as a result of the consummation of the
transactions contemplated by this Agreement or any Ancillary Agreement, by any
employee, officer or director of the Company who is a “disqualified individual”
(as such term is defined in proposed Treasury Regulation Section 1.280G-1) under
any Company Benefit Plan could be characterized as an “excess parachute payment”
(as defined in Section 280G(b)(1) of the Code).
 
Section 3.9.7        Except as required by Law, no Company Benefit Plan provides
any of the following retiree or post-employment benefits to any person: medical,
disability or life insurance benefits.  No Company Benefit Plan is a voluntary
employee benefit association under Section 501(a)(9) of the Code.  The Company
and each ERISA Affiliate are in compliance in all material respects with (i) the
requirements of the applicable health care continuation and notice provisions of
the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended, and the
regulations (including proposed regulations) thereunder and any similar state
law and (ii) the applicable requirements of the Health Insurance Portability and
Accountability Act of 1996, as amended, and the regulations (including the
proposed regulations) thereunder.
 
Section 3.9.8         The Company has no Company Benefit Plan that is subject to
the laws of any jurisdiction outside of the United States.
 
Section 3.9.9         Each Company Benefit Plan is exempt from or in compliance
in all material respects with Section 409A of the Code, such that no amounts
payable under any Company Benefit Plan will be subject to the additional taxes
under Section 409A of the Code.
 
 
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Section 3.10       Labor and Other Employment Matters.
 
Section 3.10.1      As of the date of this Agreement, the Company employs 8
full-time employees and 3 part-time employees and engages 9 consultants or
independent contractors.  Section 3.10.1 of the Company Disclosure Schedule sets
forth a detailed description of all material compensation, including salary,
bonus, severance obligations and deferred compensation paid or payable for each
current officer, employee, consultant and independent contractor of the Company
who received compensation in excess of $50,000 for the year ended December 31,
2011 or is anticipated to receive compensation in excess of $50,000 for the
fiscal year ending December 31, 2012.
 
Section 3.10.2     To the Company’s Knowledge, none of its employees is
obligated under any contract (including licenses, covenants or commitments of
any nature) or other agreement, or subject to any judgment, decree or order of
any court or administrative agency, that would materially interfere with such
employee’s ability to promote the interest of the Company or that would conflict
with the Company’s business.  Neither the execution or delivery of this
Agreement, nor the carrying on of the Company’s business by the employees of the
Company, nor the conduct of the Company’s business as now conducted and as
presently proposed to be conducted, will, to the Company’s Knowledge, conflict
with or result in a breach of the terms, conditions, or provisions of, or
constitute a default under, any contract, covenant or instrument under which any
such employee is now obligated.
 
Section 3.10.3      The Company is not a party to any collective bargaining or
other labor union contract applicable to persons employed by the Company, and no
collective bargaining agreement or other labor union contract is being
negotiated by the Company.  There is no labor dispute, strike, slowdown or work
stoppage against the Company pending or, to the Knowledge of the Company,
threatened.  No labor union or similar organization has otherwise been certified
to represent any persons employed by the Company or has applied to represent
such employees or is attempting to organize so as to represent such
employees.  Neither the Company nor any of its representatives or employees has
committed any unfair labor practices in connection with the operation of the
business of the Company, and there is no charge or complaint against the Company
by the National Labor Relations Board or any comparable state or foreign agency
pending or, to the Knowledge of the Company, threatened.  The Company is not
delinquent in payments to any of its employees for any wages, salaries,
commissions, bonuses or other direct compensation for any services performed for
it or amounts required to be reimbursed to such employees.  The Company has
withheld all amounts required by Law or by agreement to be withheld from the
wages, salaries, and other payments to employees that either individually or in
the aggregate would result in material liability to the Company, and has no
material liability for any arrears of wages or any Taxes or any penalty for
failure to comply with any of the foregoing.  There are no pending claims
against the Company under any workers’ compensation plan or policy or for long
term disability.  There are no material controversies pending or, to the
Knowledge of the Company, threatened, between the Company and any current or
former employee.  To the Company’s Knowledge, no employee of the Company is in
violation of any term of any employment contract, non-disclosure agreement,
non-competition agreement, or any restrictive covenant to a former employer
relating to the right of any such employee to be employed by the Company because
of the nature of the business conducted or presently proposed to be conducted by
it or to the use of trade secrets or proprietary information of others.  No
employee of the Company has given notice, nor is the Company otherwise aware,
that such employee intends to terminate his or her employment with the Company.
 
 
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Section 3.10.4      The Company has identified in Section 3.10.4 of the Company
Disclosure Schedule and has made available to Parent true and complete copies of
(A) all severance and employment agreements with directors, officers or
employees of or consultants to the Company, (B) all severance programs and
policies of the Company with or relating to its employees, and (C) all plans,
programs, agreements and other arrangements of the Company with or relating to
its directors, officers, employees or consultants which contain change in
control provisions.  Except as set forth in Section 3.10.4 of the Company
Disclosure Schedule, none of the execution and delivery of this Agreement or the
consummation of the transactions contemplated hereby will (either alone or in
conjunction with any other event, such as termination of employment) (A) result
in any payment (including severance, parachute or otherwise) becoming due to any
director or any employee of the Company or any affiliate from the Company or
affiliate under any Company Benefit Plan or otherwise, (B) increase any benefits
otherwise payable under any Company Benefit Plan or (C) result in any
acceleration of the time of payment or vesting of any material benefits, except
as required by Law.  No individual who is a party to an employment agreement
listed in Section 3.10.4 of the Company Disclosure Schedule or any agreement
incorporating change in control provisions with the Company has terminated
employment or been terminated, nor to the Knowledge of the Company has any event
occurred that could reasonably be expected to give rise to a termination event,
in either case under circumstances that has given, or could reasonably be
expected to give, rise to a severance obligation on the part of the Company
under such agreement.  
 
Section 3.10.5       There are no pending or, to the Knowledge of the Company,
threatened claims (other than claims for benefits in the ordinary course),
lawsuits or arbitrations which have been asserted or instituted against any
Company Benefit Plan, any fiduciaries thereof with respect to their duties to
the Company Benefit Plans or the assets of any of the trusts under any of the
Company Benefit Plans which could reasonably be expected to result in any
material liability of the Company to the PBGC, the Department of Treasury, the
Department of Labor or any Multiemployer Plan.
 
Section 3.10.6       Each current and former employee, consultant and officer of
the Company has executed an agreement with the Company regarding confidentiality
and proprietary information substantially in the form or forms delivered to the
counsel for Parent (the “Confidential Information Agreements”).  No current or
former Key Employee has excluded works or inventions from his or her assignment
of inventions pursuant to such Key Employee’s Confidential Information
Agreement.  Each current and former Key Employee has executed a non-solicitation
agreement substantially in the form or forms delivered to counsel for
Parent.  The Company is not aware that any of its Key Employees is in violation
of any agreement covered by this Section 3.10.6.
 
Section 3.11       Tax Treatment.  Neither the Company nor, to the Knowledge of
the Company, any of the Company’s affiliates has taken or agreed to take any
action that would prevent the Merger from qualifying as a reorganization within
the meaning of Section 368(a) of the Code.  The Company is not aware of any
agreement, plan or other circumstance that would prevent the Merger from
qualifying as a reorganization within the meaning of Section 368(a) of the Code.
 
 
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Section 3.12       Contracts.  Section 3.12 of the Company Disclosure Schedule
contains a complete list, as of the date of this Agreement, of all contracts to
which the Company is a party to or bound and that fall within any of the
following categories (each, a “Material Contract”):
 
(a)           each Contract involving future payments in excess of $50,000;
 
(b)           each Contract which restricts the Company from competing with any
Person in a line of business or in any geographic area;
 
(c)           each indenture or other Contract relating to Indebtedness or to
the mortgaging or pledging of any asset of the Company;
 
(d)           each Contract giving rise to any Change of Control Obligation;
 
(e)           each stockholders agreement, registration rights agreement, voting
agreement or similar Contract;
 
(f)           each Contract with any Governmental Entity;
 
(g)           each Contract with any Related Party;
 
(h)           each Contract requiring any consent in connection with the Merger
and/or the other transactions contemplated by this Agreement;
 
(i)            each employment and consultant agreement; and
 
(j)            any other Contract not otherwise listed that is material to the
Company and/or its business.
 
Each Material Contract is valid and binding on the Company and, to the Company’s
Knowledge, each other party thereto, and in full force and effect, and the
Company has performed all material obligations required to be performed by it to
the date of this Agreement under each Material Contract and, to the Company’s
Knowledge, each other party to each Material Contract has performed all
obligations required to be performed by it under such Material Contract.  The
Company has no Knowledge of, or has received no written notice of, any material
violation or default under (or any condition which with the passage of time or
the giving of notice would cause such a violation of or default under) any
Material Contract.
 
 
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Section 3.13       Litigation.  Except as set forth in Section 3.13 of the
Company Disclosure Schedule, (A) there is no suit, claim, charge, action,
proceeding, arbitration or investigation pending or, to the Knowledge of the
Company, threatened in writing against the Company or any officer or director of
the Company arising out of their employment or board relationship with the
Company or for which the Company is obligated to indemnify a third party and (B)
neither the Company nor any officer or director of the Company is subject to any
outstanding order, writ, injunction, decree or arbitration ruling, award or
other written finding.
 
Section 3.14       Environmental Matters.  Except as would not, individually or
in the aggregate, reasonably be expected to have a Company Material Adverse
Effect:
 
Section 3.14.1      The Company (A) is in compliance with all, and is not
subject to any liability, with respect to any applicable Environmental Laws, (B)
holds or has applied for all Environmental Permits necessary to conduct its
operations, and (C) is in compliance with all Environmental Permits.
 
Section 3.14.2      The Company has not received any written notice, demand,
letter, claim or request for information alleging that the Company may be in
violation of, or liable under, any Environmental Law.
 
Section 3.14.3      The Company (A) has not entered into or agreed to any
consent decree or order or is subject to any judgment, decree or judicial order
relating to compliance with Environmental Laws, Environmental Permits or the
investigation, sampling, monitoring, treatment, remediation, removal or cleanup
of Hazardous Materials and, to the Knowledge of the Company, no investigation,
litigation or other proceeding is pending or threatened in writing with respect
thereto, or (B) is not an indemnitor in connection with any claim threatened or
asserted in writing by any third-party indemnitee for any liability under any
Environmental Law or relating to any Hazardous Materials.
 
Section 3.14.4      None of the real property owned or leased by the Company is
listed or, to the Knowledge of the Company, proposed for listing on the
“National Priorities List” under CERCLA, as updated through the date of this
Agreement, or any similar state or foreign list of sites requiring investigation
or cleanup.
 
 
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Section 3.15       Intellectual Property.  The Company owns or has the right to
use all Intellectual Property used by Company in the Company’s business as such
business is or is presently proposed in written documents delivered by Company
to Parent to be conducted on the date of this Agreement (“Company Intellectual
Property”).  Except as set forth in Section 3.15 of the Company Disclosure
Schedule: (A) no claim asserting invalidity or conflicting ownership rights with
respect to any Company Intellectual Property has been made in writing by a third
party against Company and no such Company Intellectual Property owned or
purported to be owned by Company is the subject of any pending or, to the
Company’s Knowledge, threatened in writing, action, suit, claim, investigation,
arbitration or other proceeding asserting invalidity or conflicting ownership of
Company Intellectual Property; (B) no person or entity has given written notice
to the Company asserting that the use of any Company Intellectual Property by
the Company or any licensee of Company is infringing or has infringed any
domestic or foreign patent, trademark, service mark, trade name, or copyright or
design right, or that the Company or any licensee of Company has misappropriated
or improperly used or disclosed any trade secret, confidential information or
know-how; (C) the making, using, selling, manufacturing, marketing, licensing,
reproduction, distribution, provision or publishing of any product or service
conducted by the Company in the operation of the Company’s business, in each
case has not infringed or misappropriated, and does not and will not infringe or
misappropriate, (1) any Intellectual Property of any third party (or the subject
matter thereof) other than patents or (2) to the Company’s Knowledge, patents of
any third party; (D) to the Company’s Knowledge, there exists no prior act or
current conduct or use by the Company or any third party that would void or
invalidate any Company Intellectual Property owned or purported to be owned by
Company registered with a Government Authority in the name of Company or applied
to be so registered (collectively, “Registered Company Intellectual Property”)
that the Company desired to keep valid, in effect and enforceable and Section
3.15 of the Company Disclosure Schedule lists all Registered Company
Intellectual Property; (E) the execution, delivery and performance of this
Agreement by the Company and the consummation of the transactions contemplated
hereby will not breach, violate or conflict with any contract pursuant to which
Company obtains a license to any Company Intellectual Property (“Company IP
Agreements”), will not cause the forfeiture or termination or give rise to a
right of forfeiture or termination of any of the Company Intellectual Property
or impair the right of the Surviving Corporation to make, use, sell, license
dispose of or otherwise exercise or exploit, or bring any action for the
infringement of, any Company Intellectual Property, in each case except with
respect to the Company IP Agreements listed in Section 3.12(h) and Company
Intellectual Property licensed therein solely if the required consents or
required notices are not obtained or provided; provided however, Company makes
no representations or warranties under this Section 3.15(E) with respect to any
contract to which the Parent is or may be bound prior to the date hereof; (F)
the Company has not granted to a third party any options, licenses, covenants
not to sue or assert, shared ownership interests or similar rights with respect
to the Company Intellectual Property owned by Company, nor is the Company party
to any outstanding contracts pursuant to which it is granted an option or
license to any Intellectual Property owned by any third party other than for
commercially available “off-the-shelf” software; (G) to the Company’s Knowledge,
there is no, nor has there been any, infringement, violation or misappropriation
by any third party of any Company Intellectual Property; (H) each past and
current employee and consultant of the Company (or other contractor involved in
the creation or development of any Intellectual Property on behalf of Company)
has assigned to the Company all Intellectual Property he or she developed in the
course of performing services for the Company or in the scope of his or her
employment by the Company, as applicable; (I) the Company has taken commercially
reasonable security measures to protect the secrecy, confidentiality and value
of all trade secrets and other confidential information contained in the Company
Intellectual Property that Company desires to maintain as confidential or trade
secret information; (J)  to the extent the Company uses any “open source” or
“copyleft” software or is a party to “open”, “free” or “public source” licenses,
the Company is in compliance with the terms of any such licenses, and the
Company is not required under any such license to (a) make or permit any
disclosure or to make available any source code for its (or any of its
licensors’) proprietary software to the public or any third party or (b)
distribute or make available to the public or any third party any of the
Company’s proprietary software (or to permit any such distribution or
availability); and (K)  the Company and, to the Company’s Knowledge, any third
parties having authorized access to the Company’s databases or other records,
have complied in all material respects with all applicable statutes and
regulations, all contractual obligations and the Company’s publicly available
privacy policy, in each case to the extent relating to the collection, storage,
use and onward transfer of any and all personally identifiable information or
personal health information collected by or on behalf of the Company.
 
 
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Section 3.16       Taxes.
 
Section 3.16.1      The Company has timely filed all income and other material
Tax Returns with the appropriate taxing authority required to be filed, taking
into account any extensions of time within which to file such Tax Returns, and
all such Tax Returns were complete and correct in all materials respects.  All
Taxes due and owing by the Company have been paid and the Company has provided
adequate reserves in accordance with GAAP in its financial statements for any
Taxes that have not been paid, whether or not shown as being due on any Tax
Returns.
 
Section 3.16.2      There are no audits or other administrative proceedings or
court proceedings presently pending with regard to any Taxes or Tax Returns of
the Company and the Company has not received a written notice or announcement of
any audits or proceedings.  No requests for waivers of time to assess any Taxes
are pending and the Company has not waived any statute of limitations with
respect to Taxes or agreed to any extension of time with respect to any Tax
assessment or deficiency for any open tax year.
 
Section 3.16.3      There are no Tax liens upon any property or assets of the
Company except liens for current Taxes not yet due and payable and liens for
Taxes that are being contested in good faith by appropriate proceedings.
 
Section 3.16.4      The Company has withheld and paid all material Taxes
required to have been withheld and paid in connection with amounts paid or owing
to any employee, independent contractor, creditor, stockholder, or other third
party.
 
Section 3.16.5      The Company is not responsible for the Taxes of any other
person under Treasury Regulation Section 1.1502-6 (or any similar provision of
state, local, or foreign Law), as a transferee, by contract, or otherwise.
 
Section 3.16.6      To the Knowledge of the Company, no written claim has been
received from a Tax authority in a jurisdiction where the Company does not file
a Tax Return such that the Company is or may be subject to taxation in that
jurisdiction.  Section 3.16.6 of the Company Disclosure Schedule sets forth each
jurisdiction (other than United States federal) in which the Company files any
Tax Return.
 
Section 3.16.7       The Company has not been a United States real property
holding corporation within the meaning of Section 897(c)(2) of the Code during
the applicable period described in Section 897(c)(1)(A)(ii) of the Code.
 
Section 3.16.8       The Company uses the accrual method of accounting for Tax
purposes.
 
Section 3.16.9       The Company will not be required to include any item of
income, or exclude any deduction, in the computation of taxable income
(including any Company item that may be included in the computation of the
taxable income of Parent or any of its Affiliates for any taxable period or
portion thereof ending after the Effective Time) as a result of (i) any
installment sale or open transaction disposition made on or prior to the
Effective Time, (ii) any prepaid amount received prior to the Effective Time,
(iii) any change of method of Tax accounting, closing agreement or intercompany
transaction made or entered into prior to the Effective Time, or (iv) any
election pursuant to Section 108(i) of the Code made or entered into prior to
the Effective Time.
 
 
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Section 3.16.10     The Company has not participated in any way (i) in any "tax
shelter" within the meaning of Section 6111 of the Code (as in effect prior to
the enactment of P.L. 108-357 or any comparable Laws of jurisdictions other than
the United States) or (ii) in any "listed transaction" within the meaning of
Treasury Regulation Section 1.6011-4 (as in effect at the relevant time) (or any
comparable regulations of jurisdictions other than the United States).
 
Section 3.17       Regulatory Matters.  The Targeted Therapy Finder application
(the “App”) as currently available on the CollabRx website, www.collabrx.com,
including any predecessor version of the App, is and has been since January 1,
2011 the Company’s sole material product offering and is intended to distribute
by electronic means information to users for their personal or professional
knowledge in dealing with melanoma, lung and colorectal cancer  diseases.  The
App does not collect or maintain any individually identifiable health
information and is not intended, advertised or promoted for use in the diagnosis
of disease or other conditions, or in the cure, mitigation, treatment, or
prevention of disease in man and is not intended, advertised or promoted to
affect the structure or any function of the human body within the meaning of the
Federal Food, Drug, and Cosmetic Act, 21 U.S.C. §321(h).
 
Section 3.18       HIPAA.  The Company is not a "Covered Entity" as that term is
defined in 45 C.F.R. § 160.103.  The Company is not in breach, default, or
violation in any material respect under:  the Health Insurance Portability and
Accountability Act of 1996 ("HIPAA"), the regulations promulgated thereunder
(including without limitation, the HIPAA Privacy Standards, HIPAA Security
Standards, and HIPAA Transactions Standards), the Health Information Technology
for Economic and Clinical Health Act or any applicable state laws relating to
the confidentiality of medical information.
 
Section 3.19       Property.  The tangible property and assets that the Company
owns are free and clear of all mortgages, deeds of trust, liens, loans and
encumbrances, except for statutory liens for the payment of current taxes that
are not yet delinquent and encumbrances and liens that arise in the ordinary
course of business and do not materially impair the Company’s ownership or use
of such property or assets.  With respect to the tangible property and assets it
leases, the Company is in compliance in all material respects with such leases
and, to its Knowledge, holds a valid leasehold interest free of any liens,
claims or encumbrances other than those of the lessors of such property or
assets.  The Company does not own any real property.
 
Section 3.20       Insurance.  The Company maintains insurance coverage with
reputable insurers, or maintains self-insurance practices, in such amounts and
covering such risks as are in accordance with normal industry practice for
companies engaged in businesses similar to that of the Company (taking into
account the cost and availability of such insurance).
 
Section 3.21       Vote Required.  The affirmative vote of the holders of a
majority of the outstanding shares of Company Capital Stock (the “Requisite
Stockholder Approval”) is the only vote, if any, of the holders of any class or
series of capital stock or other Equity Interests of the Company necessary to
approve the Merger.
 
Section 3.22      Brokers.  No broker, finder or investment banker is entitled
to any brokerage, finder’s or other fee or commission in connection with the
Merger based upon arrangements made by or on behalf of the Company.
 
 
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Section 3.23      Disclosure.   No representation or warranty of the Company
contained in this Agreement, as qualified by the Company Disclosure Schedule,
contains any untrue statement of a material fact or omits to state a material
fact necessary in order to make the statements contained herein or therein not
misleading in light of the circumstances under which they were made.
 
Article 4.
Representations and Warranties of Parent and Merger Sub
 
Parent and Merger Sub hereby jointly and severally represent and warrant to the
Company as of the date hereof and the Effective Time as follows:
 
Section 4.1         Organization and Qualification; Subsidiaries.  Each of
Parent and Merger Sub is a corporation duly organized, validly existing and in
good standing under the Laws of the State of Delaware, and has the requisite
power and authority and all necessary governmental approvals to own, lease and
operate its properties and to carry on its business as it is now being
conducted, except where the failure to have such approvals would not reasonably
be expected to have a Parent Material Adverse Effect.  Each of Parent and Merger
Sub is duly qualified or licensed to do business, and is in good standing, in
each jurisdiction where the character of the properties owned, leased or
operated by it or the nature of its business makes such qualification, licensing
or good standing necessary, except for such failures to be so qualified,
licensed or in good standing that would not, individually or in the aggregate,
reasonably be expected to have a Parent Material Adverse Effect.
 
Section 4.2         Certificate of Incorporation and Bylaws; Corporate Books and
Records.  The copies of certificate of incorporation (the “Parent Certificate”)
and bylaws (the “Parent Bylaws”) that are listed as exhibits to Parent’s Form
10-K for the year ended March 31, 2011 (the “Parent Form 10-K”) are complete and
correct copies thereof as in effect on the date of this Agreement.  Parent is
not in violation of any of the provisions of the Parent Certificate or Parent
Bylaws.
 
Section 4.3          Capitalization.  The authorized capital stock of Parent
consists of 50,000,000 shares of Parent Common Stock and 5,000,000 shares of
preferred stock, par value $0.01 per share (the “Parent Preferred Stock”,
together with Parent Common Stock, the “Parent Capital Stock”).  As of the date
of this Agreement, 1,688,807 shares of Parent Common Stock and no shares of
Parent Preferred Stock were issued and outstanding.  As of the date of this
Agreement, except as described in the Parent SEC Filings, there were no options,
warrants or other rights to purchase capital stock of Parent, or securities
convertible into or exchangeable for such capital stock or obligating Parent to
issue or sell any shares of capital stock, or securities convertible into or
exchangeable for such capital stock of Parent.  There are no outstanding shares
of Parent Capital Stock that constitute unvested restricted stock or that are
otherwise subject to a repurchase or redemption right.  There are no declared or
accrued but unpaid dividends with respect to any shares of Parent Capital
Stock.  The shares of Parent Common Stock to be issued in connection with the
Merger, when issued as contemplated herein, will be duly authorized, validly
issued, fully paid and nonassessable and will not be issued in violation of any
preemptive rights.
 
 
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Section 4.4         Authority.  Each of Parent and Merger Sub has all necessary
corporate power and authority to execute and deliver this Agreement and each
Ancillary Agreement to which it is party, to perform its obligations hereunder
and thereunder and to consummate the transactions contemplated by this Agreement
and each Ancillary Agreement to be consummated by it.  Each of (A) the execution
and delivery of this Agreement and each Ancillary Agreement to which it is a
party by each of Parent and Merger Sub and the consummation by Parent and Merger
Sub, as applicable, of the transactions contemplated hereby and thereby and (B)
the issuance of shares of Parent Common Stock in accordance with the Merger,
have been duly and validly authorized by all necessary corporate action
(including approval by Parent as sole stockholder of Merger Sub), and no other
corporate proceedings on the part of Parent and Merger Sub and no other
stockholder votes are necessary to authorize this Agreement or any such
Ancillary Agreement or to consummate the transactions contemplated hereby or
thereby.  This Agreement and each Ancillary Agreement to which Parent or Merger
Sub is a party have been duly authorized and validly executed and delivered by
Parent and Merger Sub, as applicable, and constitute a legal, valid and binding
obligation of Parent and Merger Sub, enforceable against Parent and Merger Sub
in accordance with its terms.
 
Section 4.5          No Conflict; Required Filings and Consents.
 
Section 4.5.1         The execution and delivery of this Agreement and each
Ancillary Agreement to which Parent or Merger Sub is a party do not, and the
performance thereof by Parent and Merger Sub will not, (A) conflict with or
violate any provision of the Certificate of Incorporation or Bylaws of Parent or
Merger Sub, (B) assuming that all consents, approvals, authorizations and
permits described in Section 4.5.2 have been obtained and all filings and
notifications described in Section 4.5.2 have been made, conflict with or
violate any Law applicable to Parent or Merger Sub or any other subsidiary of
Parent (each a “Parent Subsidiary” and, collectively, the “Parent Subsidiaries”)
or by which any property or asset of Parent, Merger Sub or any Parent Subsidiary
is bound or affected in any material respect or (C) result in any material
breach of, any material loss of any benefit under, constitute a default (or an
event which with notice or lapse of time or both would become a default) under,
or give to others any right of termination, amendment, acceleration or
cancellation of, or result in the creation of a lien or other encumbrance on any
property or asset of Parent, Merger Sub or any Parent Subsidiary pursuant to any
material note, bond, mortgage, indenture, contract, agreement, lease, license,
permit, other instrument or obligation.
 
Section 4.5.2         The execution and delivery of this Agreement and each
Ancillary Agreement to which Parent or Merger Sub is a party do not, and the
performance hereof and thereof by Parent and Merger Sub will not, require any
consent, approval, authorization or permit of, or filing with or notification
to, any Governmental Entity or other person, except under the Exchange Act, the
Securities Act, any applicable Blue Sky Laws, the rules and regulations of the
Exchange and filing and recordation of the Certificate of Merger as required by
Delaware Law.
 
Section 4.6         Litigation.  There is no suit, claim, charge, action,
proceeding, arbitration or investigation pending or, to the Knowledge of Parent,
threatened in writing against the Parent or Merger Sub, their properties or any
officer or director of Parent or Merger Sub arising out of their employment or
board relationship with Parent or Merger Sub or for which Parent or Merger Sub
is obligated to indemnify a third party.  None of Parent, Merger Sub or any
officer or director of Parent or Merger Sub is subject to any outstanding order,
writ, injunction, decree or arbitration ruling, award or other written finding.
 
 
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Section 4.7          SEC Filings; Financial Statements.
 
Section 4.7.1        Parent has timely filed all registration statements,
prospectuses, forms, reports and documents required to be filed by it under the
Securities Act or the Exchange Act, as the case may be, since April 1, 2009
(collectively, the “Parent SEC Filings”).  Each Parent SEC Filing (A) as of its
date complied in all material respects with the requirements of the Securities
Act or the Exchange Act, as the case may be, and (B) did not, at the time they
were filed, contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary in order to make the
statements made therein, in the light of the circumstances under which they were
made, not misleading.
 
Section 4.7.2        Each of the consolidated financial statements (including,
in each case, any notes thereto) contained in the Parent SEC Filings was
prepared in accordance with GAAP applied (except as may be indicated in the
notes thereto and, in the case of unaudited quarterly financial statements, as
permitted by Form 10-Q under the Exchange Act) on a consistent basis throughout
the periods indicated (except as may be indicated in the notes thereto), and
each presented fairly the consolidated financial position of Parent as of the
respective dates thereof and for the respective periods indicated therein
(subject, in the case of unaudited statements, to normal and recurring year-end
adjustments which did not and would not, individually or in the aggregate,
reasonably be expected to have a Parent Material Adverse Effect).  The books and
records of Parent have been, and are being, maintained in accordance with
applicable legal and accounting requirements.
 
Section 4.8         Absence of Certain Changes or Events.  Since December 31,
2011, except as specifically contemplated by this Agreement, there has not been
(A) any Parent Material Adverse Effect or an event or development that would,
individually or in the aggregate, reasonably be expected to have a Parent
Material Adverse Effect, (B) any event or development that would, individually
or in the aggregate, reasonably be expected to prevent or materially delay the
performance of this Agreement or any Ancillary Agreement by Parent or (C) any
action taken by Parent that, if taken during the period from the date of this
Agreement through the Effective Time, would constitute a breach of Section 5.2.
 
Section 4.9          Tax Matters.  None of Parent, any Parent Subsidiary or, to
the Knowledge of Parent, any of Parent’s affiliates has taken or agreed to take
any action that would prevent the Merger from qualifying as a reorganization
within the meaning of Section 368(a) of the Code.  Parent is not aware of any
agreement, plan or other circumstance that would prevent the Merger from
qualifying as a reorganization within the meaning of Section 368(a) of the Code.
 
Section 4.10       Ownership of Merger Sub; No Prior Activities.
 
Section 4.10.1      Merger Sub was formed solely for the purpose of engaging in
the transactions contemplated by this Agreement.
 
 
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Section 4.10.2      All of the outstanding capital stock of Merger Sub is owned
directly by Parent.  There are no options, warrants or other rights (including
registration rights), agreements, arrangements or commitments to which Merger
Sub is a party of any character relating to the issued or unissued capital stock
of, or other equity interests in, Merger Sub or obligating Merger Sub to grant,
issue or sell any shares of the capital stock of, or other equity interests in,
Merger Sub, by sale, lease, license or otherwise.  There are no obligations,
contingent or otherwise, of Merger Sub to repurchase, redeem or otherwise
acquire any shares of the capital stock of Merger Sub.
 
Section 4.10.3      Except for obligations or liabilities incurred in connection
with its incorporation or organization and the transactions contemplated by this
Agreement or any Ancillary Agreement, Merger Sub has not and will not have
incurred, directly or indirectly, through any subsidiary or affiliate, any
obligations or liabilities or engaged in any business activities of any type or
kind whatsoever or entered into any agreements or arrangements with any person.
 
Section 4.11      Brokers.  No broker, finder or investment banker is entitled
to any brokerage, finder’s or other fee or commission in connection with the
Merger based upon arrangements made by or on behalf of Parent or any Parent
Subsidiary.
 
Article 5.
Covenants
 
Section 5.1         Conduct of Business by the Company Pending the Effective
Time.  The Company agrees that, between the date of this Agreement and the
Effective Time, except as specifically permitted by any other provision of this
Agreement, unless Parent shall otherwise agree in writing, the Company will (A)
conduct its operations only in the ordinary and usual course of business
consistent with past practice and (B) use its commercially reasonable efforts to
keep available the services of the current officers, key employees and
consultants of the Company and to preserve the current relationships of the
Company with such of the customers, suppliers and other persons with which the
Company has significant business relations as is reasonably necessary to
preserve substantially intact its business organization as currently
conducted.  Without limiting the foregoing, except as specifically permitted by
any other provision of this Agreement, the Company shall not (unless required by
applicable Law), between the date of this Agreement and the Effective Time,
directly or indirectly, do, or agree to do, any of the following without the
prior written consent of Parent:
 
Section 5.1.1         amend or otherwise change its certificate of incorporation
or bylaws;
 
Section 5.1.2         (A)  issue, sell, pledge, dispose of, grant, transfer,
encumber, or authorize the issuance, sale, pledge, disposition, grant, transfer,
or encumbrance of any shares of capital stock of, or other Equity Interests in,
the Company of any class, or securities convertible or exchangeable or
exercisable for any shares of such capital stock or other Equity Interests, or
any options, warrants or other rights of any kind to acquire any shares of such
capital stock or other Equity Interests or such convertible or exchangeable
securities, or any other ownership interest (including, without limitation, any
such interest represented by contract right), of the Company, other than the
issuance of Company Common Stock and/or Company Warrants upon the exercise of
Company Options outstanding as of the date of this Agreement in accordance with
their terms or (B), sell, pledge, dispose of, transfer, lease, license,
guarantee or encumber, or authorize the sale, pledge, disposition, transfer,
lease, license, guarantee or encumbrance of, any material property or assets
(including Intellectual Property) of the Company, except pursuant to existing
contracts or commitments or the sale or purchase of goods or the licensing of
Intellectual Property in the ordinary course of business consistent with past
practice, or enter into any commitment or transaction outside the ordinary
course of business consistent with past practice;
 
 
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Section 5.1.3         declare, set aside, make or pay any dividend or other
similar distribution (whether payable in cash, stock, property or a combination
thereof) with respect to any of its capital stock or enter into any agreement
with respect to the voting of its capital stock;
 
Section 5.1.4         reclassify, combine, split, subdivide or redeem, purchase
or otherwise acquire, directly or indirectly, any of its capital stock, other
Equity Interests or other securities;
 
Section 5.1.5        (A)  acquire (including, without limitation, by merger,
consolidation, or acquisition of stock or assets) any interest in any person or
any division thereof or any assets, other than acquisitions of assets in the
ordinary course of business consistent with past practice, (B) incur any
Indebtedness or issue any debt securities or assume, guarantee or endorse, or
otherwise become responsible for, the obligations of any person, (C) terminate,
cancel or request any material change in, or agree to any material change in,
any Material Contract, (D) make or authorize any capital expenditure in excess
of the Company’s budget as disclosed to Parent prior to the date of this
Agreement or (E) enter into or amend any contract, agreement, commitment or
arrangement that, if fully performed, would not be permitted under this Section
5.1.5;
 
Section 5.1.6        Except as may be required by contractual commitments or
corporate policies with respect to severance or termination pay in existence on
the date of this Agreement as disclosed in Section 3.10.4 of the Company
Disclosure Schedule: (A) increase the compensation or benefits payable or to
become payable to its directors, officers or employees (except for increases in
compensation or benefits in accordance with past practices and in the ordinary
course of business); (B) grant any rights to severance or termination pay to, or
enter into any  agreement with respect to employment, severance or termination
pay or benefits with, any director, officer or other employee of the Company, or
establish, adopt, enter into or amend any collective bargaining, bonus,
compensation, stock option, restricted stock, severance or similar plan,
agreement, trust, fund, policy or arrangement for the benefit of any director,
officer or employee, except to the extent required by applicable Law; or (C)
take any affirmative action to amend or waive any performance or vesting
criteria or accelerate vesting, exercisability or funding under any Company
Benefit Plan.
 
Section 5.1.7         pre-pay any Indebtedness or pay, discharge or satisfy any
claims, liabilities or obligations (absolute, accrued, contingent or otherwise),
except in the ordinary course of business consistent with past practice and in
accordance with their terms;
 
 
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Section 5.1.8         make any change in accounting policies or procedures,
other than in the ordinary course of business consistent with past practice or
except as required by GAAP or by a Governmental Entity;
 
Section 5.1.9         waive, release, assign, settle or compromise any material
claims, or any material litigation or arbitration;
 
Section 5.1.10       make any material tax election or settle or compromise any
material liability for Taxes;
 
Section 5.1.11      take, or agree to take, any action that would prevent the
Merger from qualifying as a reorganization within the meaning of Section 368(a)
of the Code;
 
Section 5.1.12       modify, amend or terminate, or waive, release or assign any
material rights or claims with respect to any confidentiality or standstill
agreement to which the Company is a party;
 
Section 5.1.13       write up, write down or write off the book value of any
assets, except for depreciation and amortization in accordance with GAAP
consistently applied;
 
Section 5.1.14      take any action to exempt or make not subject to (A) the
provisions of Section 203 of Delaware Law or (B) any other state takeover Law or
state Law that purports to limit or restrict business combinations or the
ability to acquire or vote shares, any person or entity (other than Parent,
Merger Sub or any Parent Subsidiary) or any action taken thereby, which person,
entity or action would have otherwise been subject to the restrictive provisions
thereof and not exempt therefrom;
 
Section 5.1.15       take any action that is intended or would reasonably be
expected to result in any of the conditions to the Merger set forth in Article 6
not being satisfied; or
 
Section 5.1.16       authorize or enter into any agreement or otherwise make any
commitment to do any of the foregoing.
 
Section 5.2         Conduct of Business by Parent Pending the Effective
Time.  Except as specifically permitted by any other provision of this
Agreement, Parent shall not (unless required by applicable Law or any stock
exchange regulations applicable to the Parent), between the date of this
Agreement and the Effective Time, directly or indirectly, do, or agree to do,
any of the following, without the prior written consent of the Company:
 
Section 5.2.1         amend or otherwise change the Parent Certificate or Parent
Bylaws in a manner that adversely affects the rights of holders of Parent Common
Stock;
 
Section 5.2.2         declare, set aside, make or pay any dividend or other
distribution, payable in cash, stock, property or otherwise, with respect to any
of Parent’s capital stock;
 
 
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Section 5.2.3         make any change in accounting policies or procedures,
other than in the ordinary course of business consistent with past practice or
except as required by GAAP or a Governmental Entity;
 
Section 5.2.4         take, or agree to take, any action that would prevent the
Merger from qualifying as a reorganization within the meaning of Section 368(a)
of the Code;
 
Section 5.2.5         take any action that is intended or could reasonably be
expected to result in any of the conditions to the Merger set forth in Article 6
not being satisfied; or
 
Section 5.2.6         authorize or enter into any agreement or otherwise make
any commitment to do any of the foregoing.
 
Section 5.3         Cooperation.  The Company and Parent shall coordinate and
cooperate in connection with (A) determining whether any action by or in respect
of, or filing with, any Governmental Entity is required, or any actions,
consents, approvals or waivers are required to be obtained from parties to any
Material Contracts, in connection with the consummation of the Merger and (B)
seeking any such actions, consents, approvals or waivers or making any such
filings or furnishing information required in connection therewith.
 
Section 5.4          Stockholder Consents; Information Statement.
 
Section 5.4.1         The Company shall use its commercially reasonable efforts
to obtain the Requisite Stockholder Approval within twenty-four (24) hours
following the time of execution of this Agreement in compliance with Delaware
Law and, as applicable, California Law.  The Company shall use commercially
reasonable efforts to obtain and deliver to Parent a Stockholder Consent from
each of the Company Stockholders.  Without limiting the generality of the
foregoing, as promptly as practicable after the date of this Agreement, the
Company shall distribute to its stockholders a solicitation statement for the
solicitation of approval of the Company Stockholders describing this Agreement
and the transactions contemplated hereby.
 
Section 5.4.2         The Company shall use its commercially reasonable efforts
to obtain the approval by such number of Company Stockholders as is required by
the terms of Section 280G(b)(5)(B) of the Code in a manner which satisfies all
applicable requirements of such Section 280G(b)(5)(B) of the Code and the
Treasury Regulations thereunder, including Q-7 of Section 1.280G-1 of such
Treasury Regulations (the “Section 280G Stockholder Approval”), so as to render
the parachute payment provisions of Section 280G of the Code inapplicable to any
and all payments and/or benefits provided in accordance with agreements,
contracts or arrangements that, in the absence of such Section 280G Stockholder
Approval, would not be deductible by operation of Section 280G of the Code.
 
Section 5.4.3        The Company shall use its commercially reasonable efforts
to obtain the requisite stockholder approval necessary to terminate (a) the
Amended and Restated Investors’ Rights Agreement, dated as of April 2, 2011, and
(b) the Amended and Restated Right of First Refusal and Co-Sale Agreement, dated
as of April 2, 2011.
 
 
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Section 5.5          Access to Information; Confidentiality.
 
Section 5.5.1        From the date of this Agreement to the Effective Time, the
Company shall, and shall cause its directors, officers, employees, accountants,
consultants, legal counsel, advisors, and agents and other representatives
(collectively, the “Company Representatives”) to (A) provide to Parent and
Merger Sub and their respective officers, directors, employees, accountants,
consultants, legal counsel, advisors, agents and other representatives
(collectively, the “Parent Representatives”) access at reasonable times upon
prior written notice to the Company’s officers, employees, agents, properties,
offices and other facilities and to the Company’s books and records and (B)
furnish promptly such information concerning the Company’s business, properties,
contracts, assets, liabilities, personnel and other matters as Parent or the
Parent Representatives may reasonably request.  No investigation conducted
pursuant to this Section 5.5.1 shall affect or be deemed to modify or limit any
representation or warranty made in this Agreement.
 
Section 5.5.2        With respect to the information disclosed pursuant to
Section 5.5.1, the parties shall comply with, and shall cause their respective
Representatives to comply with, all of their respective obligations under the
Confidentiality Agreement previously executed by the Company and Parent (the
“Confidentiality Agreement”).
 
Section 5.6          No Solicitation of Transactions.
 
Section 5.6.1         Until the earlier of (i) the Effective Time or (ii) the
date of termination of this Agreement pursuant to the provisions of Section 7.1
hereof, the Company shall not, directly or indirectly, take (and the Company
shall not authorize or permit the Company Representatives or affiliates to take)
any action to (A) encourage (including by way of furnishing non-public
information), solicit, initiate or facilitate any Acquisition Proposal, (B)
enter into any agreement with respect to any Acquisition Proposal or enter into
any agreement, arrangement or understanding requiring it to abandon, terminate
or fail to consummate the Merger or any other transaction contemplated by this
Agreement or (C) participate in any way in discussions or negotiations with, or
furnish any information to, any person in connection with, or take any other
action to facilitate any inquiries or the making of any proposal that
constitutes, or could reasonably be expected to lead to, any Acquisition
Proposal.  
 
Section 5.6.2         The Company shall, as promptly as practicable (and in no
event later than 24 hours after receipt thereof), advise Parent of any inquiry
received by it relating to any potential Acquisition Proposal and of the
material terms of any proposal or inquiry, including the identity of the person
and its affiliates making the same, that it may receive in respect of any such
potential Acquisition Proposal, or of any information requested from it or of
any negotiations or discussions being sought to be initiated with it, shall
furnish to Merger Sub a copy of any such written proposal or inquiry, if it is
in writing and shall keep Parent fully informed on a prompt basis with respect
to any developments with respect to the foregoing.
 
Section 5.6.3        Neither the Company Board nor any committee thereof shall
(A) withdraw or modify in a manner adverse to Parent, the approval or
recommendation by the Company Board or such committee of the adoption and
approval of the Merger (the “Company Recommendation”), (B) other than the
Merger, approve or recommend, or propose publicly to approve or recommend, any
Acquisition Proposal or (C) cause the Company to enter into any letter of
intent, agreement in principle, acquisition agreement or other similar agreement
related to any Acquisition Proposal.
 
 
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Section 5.7          Appropriate Action; Consents; Filings.
 
Section 5.7.1         The Company and Parent shall use their commercially
reasonable efforts to (A) take, or cause to be taken, all appropriate action,
and do, or cause to be done, all things necessary, proper or advisable under
applicable Law or otherwise to consummate and make effective the transactions
contemplated by this Agreement and each Ancillary Agreement as promptly as
practicable, (B) obtain from any Governmental Entity any consents, licenses,
permits, waivers, approvals, authorizations or orders required to be obtained or
made by Parent or the Company, or to avoid any action or proceeding by any
Governmental Entity, in connection with the authorization, execution and
delivery of this Agreement and each Ancillary Agreement and the consummation of
the transactions contemplated herein and therein, including, without limitation,
the Merger, and (C) make all necessary filings, and thereafter make any other
required submissions, with respect to this Agreement and each Ancillary
Agreement and the Merger required under (x) the Securities Act and the Exchange
Act, and any other applicable federal or state securities Laws and (y) any other
applicable Law.  The Company and Parent shall furnish to each other all
information required for any application or other filing under the rules and
regulations of any applicable Law in connection with the transactions
contemplated by this Agreement and each Ancillary Agreement.
 
Section 5.7.2        The Company and Parent shall give any notices to third
parties, and use commercially reasonable efforts to obtain any third party
consents, (A) necessary, proper or advisable to consummate the transactions
contemplated in this Agreement and each Ancillary Agreement, (B) required to be
disclosed in the Company Disclosure Schedule, (C) required to prevent a Company
Material Adverse Effect from occurring prior to or after the Effective Time or
(D) otherwise referenced in Section 6.1.3.  In the event that either party shall
fail to obtain any third party consent described in the first sentence of this
Section 5.7.2, such party shall use commercially reasonable efforts, and shall
take any such actions reasonably requested by the other party hereto, to
minimize any adverse effect upon the Company and Parent and their respective
businesses resulting, or which could reasonably be expected to result after the
Effective Time, from the failure to obtain such consent.
 
Section 5.7.3         From the date of this Agreement until the Effective Time,
the Company shall promptly notify Parent in writing of any pending or, to the
Knowledge of the Company, threatened action, suit, arbitration or other
proceeding or investigation by any Governmental Entity or any other person (A)
challenging or seeking damages in connection with the Merger or the conversion
of Company Capital Stock into Parent Common Stock pursuant to the Merger or (B)
seeking to restrain or prohibit the consummation of the Merger or otherwise
limit the right of Parent to own or operate all or any portion of the business
or assets of the Company.
 
Section 5.8         Certain Notices.  From and after the date of this Agreement
until the Effective Time, each party hereto shall promptly notify the other
party hereto of (A) the occurrence, or non-occurrence, of any event that would
be likely to cause any condition to the obligations of any party to effect the
Merger and the other transactions contemplated by this Agreement or any
Ancillary Agreement not to be satisfied or (B) the failure of the Company or
Parent, as the case may be, to comply with or satisfy any covenant, condition or
agreement to be complied with or satisfied by it pursuant to this Agreement or
any Ancillary Agreement which would reasonably be expected to result in any
condition to the obligations of any party to effect the Merger and the other
transactions contemplated by this Agreement or any Ancillary Agreement not to be
satisfied; provided, however, that the delivery of any notice pursuant to this
Section 5.8 shall not cure any breach of any representation or warranty
requiring disclosure of such matter prior to the date of this Agreement or
otherwise limit or affect the remedies available hereunder to the party
receiving such notice.
 
 
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Section 5.9         Public Announcements.  Parent and the Company shall consult
with each other before issuing any press release or otherwise making any public
statements with respect to the Merger and shall not issue any such press release
or make any such public statement prior to such consultation, except as may be
required by applicable Law or any listing agreement with the Exchange.
 
Section 5.10       Stock Exchange Listing.  Parent shall promptly prepare and
submit to the Exchange a listing application covering the shares of Parent
Common Stock to be issued in the Merger and shall use its commercially
reasonable efforts to cause such shares to be approved for listing on such
Exchange, subject to official notice of issuance.
 
Section 5.11       Employees.  Parent intends that each employee of the Company
as of the Effective Time receive an offer of employment from Parent or one of
its subsidiaries or have his or her employment continued by the Surviving
Corporation or one of its subsidiaries.  Such offers of employment will provide
for (i) base compensation and (ii) material employee benefits as set forth in
Section 5.12.
 
Section 5.12       Employee Benefit Matters.  To the extent permissible under
applicable Law and the terms of any Parent Benefit Plan as of the Effective
Time, the Company, the Surviving Corporation and Parent shall provide all
Continuing Employees with comparable types and levels of employee benefits
(excluding any defined benefit pension plan and equity award benefits) (“Parent
Benefit Plans”), as those provided to similarly-situated employees of Parent. To
the extent such employee benefits are provided through Parent Benefit Plans and
not the Company Benefit Plans, then for purposes of determining eligibility to
participate, vesting and entitlement to benefits where length of service is
relevant under any Parent Benefit Plan and to the extent permitted by applicable
Law and the terms of any Parent Benefit Plan and subject to any applicable break
in service or similar rule, Parent shall provide service credit, or shall cause
service credit to be provided, to Continuing Employees under the Parent Benefit
Plans for their period of service with the Company and its Subsidiaries prior to
the Effective Time, except where doing so would cause a duplication of
benefits.  If benefits are provided under Parent Benefit Plans, to the extent
permissible under applicable Law and the terms of any Parent Benefit Plan Parent
shall cause any and all pre-existing condition (or actively at work or similar)
limitations, eligibility waiting periods and evidence of insurability
requirements under any Parent Benefit Plan that is a group health plan to be
waived with respect to such Continuing Employees and their eligible dependents
in accordance with applicable Law and, if the Effective Time occurs on a date
other than the last day of a Company Benefit Plan year and such benefits are
provided under Parent Benefit Plans, Parent shall provide them with credit for
any co-payments, deductibles, and offsets (or similar payments) made during the
Company Benefit Plan year including the Effective Time for the purposes of
satisfying any applicable deductible, out-of-pocket, or similar requirements
under any Parent Benefit Plan in which they are eligible to participate after
the Effective Time.  For purposes of this Agreement, a “Continuing Employee”
means a Company employee who both (i) remains employed with the Company or its
Subsidiaries immediately prior to the Effective Time, and (ii) continues his or
her service with the Surviving Corporation or Parent or any of their respective
Subsidiaries at the Effective Time.
 
 
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Section 5.13       Indemnification of Directors and Officers.  Parent and the
Surviving Corporation agree that the indemnification obligations set forth in
the Company Certificate and Company Bylaws shall survive the Merger (and, prior
to the Effective Time, Parent shall cause the Certificate of Incorporation and
Bylaws of Merger Sub to reflect such provisions) and shall not be amended,
repealed or otherwise modified for a period of  six years after the Effective
Time in any manner that would adversely affect the rights thereunder of any
individual who on or prior to the Effective Time was a director, officer,
trustee, fiduciary, employee or agent of the Company or who served at the
request of the Company as a director, officer, trustee, partner, fiduciary,
employee or agent of another corporation, partnership, joint venture, trust,
pension or other employee benefit plan or enterprise, unless such amendment or
modification is required by Law.
 
Section 5.14       Plan of Reorganization.  This Agreement is intended to
constitute a “plan of reorganization” within the meaning of Treasury Regulation
Section 1.368-2(g).  Each party hereto shall use its commercially reasonable
efforts to cause the Merger to qualify, and will not knowingly take any actions
or cause any actions to be taken which could reasonably be expected to prevent
the Merger from qualifying as a reorganization within the meaning of Section
368(a) of the Code.
 
Article 6.
Closing Conditions
 
Section 6.1         Conditions to Obligations of Each Party Under This
Agreement.  The respective obligations of each party to effect the Merger and
the other transactions contemplated by this Agreement shall be subject to the
satisfaction at or prior to the Effective Time of the following conditions, any
or all of which may be waived, in whole or in part, to the extent permitted by
applicable Law:
 
Section 6.1.1        Stockholder Approval.  This Agreement and the Merger shall
have been approved and adopted by the Requisite Stockholder Approval.
 
Section 6.1.2         No Order.  No Governmental Entity, nor any federal or
state court of competent jurisdiction or arbitrator shall have enacted, issued,
promulgated, enforced or entered any statute, rule, regulation, executive order,
decree, judgment, injunction or arbitration award or finding or other order
(whether temporary, preliminary or permanent), in any case which is in effect
and which prevents or prohibits consummation of the Merger or any other
transactions contemplated in this Agreement or any Ancillary Agreement.
 
 
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Section 6.1.3         Consents and Approvals.  All consents, approvals and
authorizations of any Governmental Entity required to be set forth in Section
3.5.2 of the Company Disclosure Schedule shall have been obtained, in each case
without (A) the imposition of conditions, (B) the requirement of divestiture of
assets or property or (C) the requirement of expenditure of money by Parent or
the Company to a third party in exchange for any such consent.
 
Section 6.2          Additional Conditions to Obligations of Parent and Merger
Sub. The obligations of Parent and Merger Sub to effect the Merger and the other
transactions contemplated by this Agreement are also subject to the following
conditions:
 
Section 6.2.1         Representations and Warranties.  Each of the
representations and warranties of the Company contained in this Agreement shall
be true and correct in all material respects as of the date of this Agreement
and as of the Effective Time as though made on and as of the Effective Time
(except that those representations and warranties which address matters only as
of a particular date need only be true and correct as of such date and those
representations and warranties qualified by their terms by a reference to
materiality shall be true and correct in all respects).  Parent shall have
received a certificate of an executive officer of the Company to that effect.
 
Section 6.2.2         Agreements and Covenants.  The Company shall have
performed or complied in all material respects with all agreements and covenants
required by this Agreement to be performed or complied with by it on or prior to
the Effective Time.  Parent shall have received a certificate of an executive
officer of the Company to that effect.
 
Section 6.2.3         Material Adverse Effect.  Since the date of this
Agreement, there shall not have occurred any Company Material Adverse Effect or
any event or development that would, individually or in the aggregate,
reasonably be expected to have a Company Material Adverse Effect.  Parent shall
have received a certificate of an executive officer of the Company to that
effect.
 
Section 6.2.4        Consents and Approvals.  All consents, approvals and
authorizations required to be set forth in Section 3.5 of the Company Disclosure
Schedule shall have been obtained, in each case without (A) the imposition of
conditions, (B) the requirement of divestiture of assets or property or (C) the
requirement of expenditure of money by Parent or the Company to a third party in
exchange for any such consent.
 
Section 6.2.5         Court Proceedings.  No action or claim shall be pending
or, to the Company’s Knowledge threatened before any court or quasi-judicial or
administrative agency of any federal, state, local or foreign jurisdiction or
before any arbitrator wherein an unfavorable injunction, judgment, order,
decree, ruling or charge would (A) prevent consummation of any of the
transactions contemplated by this Agreement or any  Ancillary Agreement, (B)
cause any of the transactions contemplated by this Agreement or any Ancillary
Agreement to be rescinded following consummation thereof or (C) affect adversely
the right or powers of Parent to own, operate or control the Company, and no
such injunction, judgment, order, decree, ruling or charge shall be in effect.
 
Section 6.2.6         Agreement Not to Compete.  Jay M. Tenenbaum shall have
entered into an Agreement Not to Compete with Parent.
 
 
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Section 6.2.7        Stockholders Agreement.  Each Company Stockholder expected
to receive at least 5,000 shares of Parent Common Stock in connection with the
Merger shall have entered into the Stockholders Agreement, pursuant to which,
among other things, such Company Stockholders will agree not to sell or
otherwise transfer any shares of Parent Common Stock received in connection with
the Merger for a period of two (2) years after the Effective Time.
 
Section 6.2.8        Employment Agreement.  James Karis shall have entered into
an employment agreement with Parent in connection with the execution of this
Agreement, and such employment agreement shall not have been revoked and shall
be in full force and effect.
 
Section 6.2.9         Stockholder Approval.  Company Stockholders holding at
least ninety percent (90%) of the Company Capital Stock shall have executed a
Stockholder Consent.
 
Section 6.2.10      Convertible Promissory Note.  All outstanding convertible
promissory notes issued by the Company pursuant to the Convertible Note and
Warrant Purchase Agreement dated as of February 17, 2012 shall have been
cancelled and, in exchange therefor, Parent shall have issued Replacement Notes
with an aggregate principal amount of $500,000.
 
Section 6.2.11      FIRPTA Certificate.  The Company shall have provided to
Parent a certificate dated as of the date of the Effective Time satisfying the
requirements set forth in Treasury Regulation Sections 1.1445-2(c)(3) and
1.897-2(h), in form and substance reasonably satisfactory to Parent, certifying
that the Company is not nor has been a “United States real property holding
corporation” (as defined in Section 897(c)(2) of the Code) at any time during
the five (5) years preceding the date of the certificate (or such shorter period
as may be specified by Section 897(c)(1)(A)(ii) of the Code).
 
Section 6.2.12      Stock Powers.  Each Company Stockholder receiving shares of
Parent Common Stock in connection with the Merger shall execute and deliver to
Parent a stock power covering all of his, her or its Holdback Shares.
 
Section 6.2.13       Financing Documents.  Each of the Amended and Restated
Investors’ Rights Agreement, dated as of April 2, 2011, and the Amended and
Restated Right of First Refusal and Co-Sale Agreement, dated as of April 2,
2011, shall have been terminated.
 
Section 6.2.14       Domain Name.  The domain name www.collabrx.com shall have
been assigned to the Company.
 
Section 6.3          Additional Conditions to Obligations of the Company.  The
obligation of the Company to effect the Merger and the other transactions
contemplated herein are also subject to the following conditions:
 
Section 6.3.1        Representations and Warranties.  Each of the
representations and warranties of Parent and Merger Sub contained in this
Agreement shall be true and correct in all material respects as of the date of
this Agreement and as of the Effective Time as though made on and as of the
Effective Time (except that those representations and warranties which address
matters only as of a particular date need only be true and correct as of such
date).  The Company shall have received a certificate of an executive officer of
Parent to that effect.
 
 
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Section 6.3.2         Agreements and Covenants.  Parent and Merger Sub shall
have performed or complied in all material respects with all agreements and
covenants required by this Agreement to be performed or complied with by them on
or prior to the Effective Time.  The Company shall have received a certificate
of an executive officer of Parent to that effect.
 
Section 6.3.3         Material Adverse Effect.  Since the date of this
Agreement, there shall not have occurred any Parent Material Adverse Effect or
any event or development that would, individually or in the aggregate,
reasonably be expected to have a Parent Material Adverse Effect.  Company shall
have received a certificate of an executive officer of the Parent to that
effect.
 
Section 6.3.4         Stockholders Agreement.  Parent shall have entered into
the Stockholders Agreement.
 
Article 7.
Termination, Amendment and Waiver
 
Section 7.1         Termination.  This Agreement may be terminated, and the
Merger contemplated hereby may be abandoned, at any time prior to the Effective
Time, by action taken or authorized by the Board of Directors of the terminating
party or parties, whether before or after approval of the matters presented in
connection with the Merger by the Company Stockholders:
 
Section 7.1.1         By mutual written consent of Parent and the Company;
 
Section 7.1.2        By either the Company or Parent if the Merger shall not
have been consummated prior to August 31, 2012; provided, however, that the
right to terminate this Agreement under this Section 7.1.2 shall not be
available to any party whose failure to fulfill any obligation under this
Agreement has been the cause of, or resulted in, the failure of the Merger to
occur on or before such date;
 
Section 7.1.3         By either the Company or Parent if any Governmental Entity
shall have issued an order, decree or ruling or taken any other action
permanently restraining, enjoining or otherwise prohibiting the transactions
contemplated by this Agreement, and such order, decree, ruling or other action
shall have become final and nonappealable (which order, decree, ruling or other
action the parties shall have used their commercially reasonable efforts to
resist, resolve or lift, as applicable);
 
Section 7.1.4        By Parent, if since the date of this Agreement, there shall
have been any event, development or change of circumstance that constitutes, has
had or could reasonably be expected to have, individually or in the aggregate, a
Company Material Adverse Effect and such Company Material Adverse Effect is not
cured within 10 days after written notice thereof or if (A)(1) there shall be
materially breached any covenant or agreement on the part of the Company set
forth in this Agreement or (2) any representation or warranty of the Company set
forth in this Agreement shall have become untrue in any material respect and (B)
such breach or misrepresentation is not cured within 10 days after written
notice thereof; or
 
 
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Section 7.1.5         By Company, if since the date of this Agreement, there
shall have been any event, development or change of circumstance that
constitutes, has had or could reasonably be expected to have, individually or in
the aggregate, a Parent Material Adverse Effect and such Parent Material Adverse
Effect is not cured within 10 days after written notice thereof or if (A)(1)
Parent has materially breached any covenant or agreement on the part of Parent
or Merger Sub set forth in this Agreement, (2) any representation or warranty of
Parent or Merger Sub shall have become untrue in any material respect and (B)
such breach or misrepresentation is not cured within 10 days after written
notice thereof.
 
Section 7.2         Effect of Termination.  In the event of termination of this
Agreement by either the Company or Parent as provided in Section 7.1, this
Agreement shall forthwith become void and there shall be no liability or
obligation on the part of Parent or the Company or their respective officers or
directors with respect to any liabilities or damages incurred or suffered by a
party as a result of the breach by the other party of any of its
representations, warranties, covenants or other agreements set forth in this
Agreement.
 
Section 7.3         Amendment.  This Agreement may be amended by the parties
hereto by action taken by or on behalf of their respective Boards of Directors
at any time prior to the Effective Time; provided, however, that, after approval
of the Merger by the Company Stockholders, no amendment may be made without
further stockholder approval which, by Law, requires further approval by such
stockholders.  This Agreement may not be amended except by an instrument in
writing signed by the parties hereto.
 
Section 7.4          Waiver.  At any time prior to the Effective Time, any party
hereto may (A) extend the time for the performance of any of the obligations or
other acts of the other party hereto, (B) waive any inaccuracies in the
representations and warranties of the other party contained herein or in any
document delivered pursuant hereto, and (C) waive compliance by the other party
with any of the agreements or conditions contained herein; provided, however,
that after any approval of the transactions contemplated by this Agreement by
the Company Stockholders, there may not be, without further approval of such
stockholders, any extension or waiver of this Agreement or any portion thereof
which, by, requires further approval by such stockholders.  Any such extension
or waiver shall be valid only if set forth in an instrument in writing signed by
the party or parties to be bound thereby, but such extension or waiver or
failure to insist on strict compliance with an obligation, covenant, agreement
or condition shall not operate as a waiver of, or estoppel with respect to, any
subsequent or other failure.
 
Section 7.5         Fees and Expenses.  All expenses incurred by the parties
hereto shall be borne solely and entirely by the party which has incurred the
same.
 
 
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Article 8.
Indemnification
 
Section 8.1         Survival of Representations and Warranties.  If the Merger
is consummated, the representations and warranties of the parties contained in
this Agreement shall survive the Effective Time for a period of twelve (12)
months after the Effective Time and then shall terminate (the “Indemnity
Termination Date”); provided, however, that the representations and warranties
of the Company set forth in Sections 3.1 (Organization and Qualification;
Subsidiaries), 3.3 (other than the last sentence of Section 3.3)
(Capitalization) and 3.4 (Authority) (collectively, the “Fundamental
Representations”) shall survive the Effective Time and remain in full force and
effect until sixty (60) days following the expiration of the applicable statute
of limitations.  Notwithstanding the foregoing, if, at any time prior to the
Indemnity Termination Date or, with respect to a Fundamental Representation,
sixty (60) days following the expiration of the applicable statute of
limitations, any Indemnified Person delivers to the Stockholders’ Representative
a Claim Notice as provided in Section 8.4.2 alleging a breach of any
representation or warranty and asserting a claim for recovery under Section 8.2
based on such breach, then the representation or warranty underlying the claim
asserted in such notice shall survive until such time as such claim is fully and
finally resolved.  If the Merger is consummated, all covenants of the parties
shall expire and be of no further force or effect as of Effective Time, except
to the extent such covenants provide that they are to be performed after the
Effective Time; provided, however, that no such termination shall relieve any
party hereto that has breached any covenant prior to such termination from
liability for Damages incurred or suffered by another party to this
Agreement.  If the Merger is consummated, this Article 8 shall be the sole
remedy to the parties for all claims other than (a) claims against any Company
Stockholder with respect to his, her or its own fraud, willful misconduct or
intentional breach or (b) claims seeking specific performance of covenants
hereunder.
 
Section 8.2         Indemnification.  After the Effective Time, and subject to
the limitations set forth in Section 8.3, each of the Company Stockholders shall
indemnify Parent, Parent’s affiliates (including the Surviving Corporation from
and after the Effective Time) and, if applicable, their respective officers,
directors, agents and employees, and their respective assigns (each of the
foregoing being referred to individually as an “Indemnified Person” and
collectively as “Indemnified Persons”) from and against any and all claims,
actions, causes of action, judgments, awards, liabilities, out-of-pocket costs,
Taxes or damages, but excluding punitive damages (other than punitive damages
awarded to a third party) (collectively, “Damages”), arising out of or resulting
from:
 
(a)           the failure of any of the representations or warranties of the
Company contained in this Agreement to be true and correct as of the date of
this Agreement and as of the Effective Time (except in the case of
representations and warranties which by their terms speak only as of a specific
date or dates, which representations and warranties shall be true and correct as
of such date or dates);
 
(b)           any material breach or nonfulfillment of any covenant or agreement
made by the Company in this Agreement;
 
(c)           any amount paid by Parent, the Company or the Surviving
Corporation to any Person with respect to Dissenting Shares under Delaware Law
or California Law that is in excess of the Fair Market Value of the shares of
Parent Common Stock that would have been issuable with respect to such shares
had such shares not been Dissenting Shares;
 
(d)           any claim by one or more Company Stockholders relating to the
sufficiency of the Parent Common Stock received or receivable pursuant to this
Agreement or lack thereof; and
 
(e)           any Pre-Closing Taxes.
 
 
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The obligations of each Company Stockholder pursuant to this Section 8.2 shall
be (i) joint and several to the extent of the Holdback Shares and (ii) several
and not joint in excess of the Holdback Shares.  Notwithstanding anything to the
contrary, in no event will any Indemnified Person be entitled to any amount
pursuant to this Article 8 for any Damages relating to the amount, value or
condition of any Tax asset or attribute (e.g. net operating loss carryforward or
tax credit carryforward) of the Company following the Effective Time, or the
ability of Parent or the Surviving Corporation to utilize such Tax assets or
attributes following the Effective Time.
 
Section 8.3          Basket; Other Limitations.
 
Section 8.3.1         Notwithstanding anything contained herein to the contrary,
no indemnification shall be available under Section 8.2(a) (other than with
respect to a Fundamental Representation) unless and until all Damages exceed
$30,000 (the “Basket”), in which case indemnification shall be available for all
Damages (including the Basket).
 
Section 8.3.2        If the Merger is consummated, offset against the Holdback
Shares shall be the sole and exclusive remedy available to the Indemnified
Persons for any claims by the Indemnified Persons against the Company
Stockholders arising out of or related to this Agreement and the transactions
contemplated hereby, except for claims based upon (i) a breach of any
Fundamental Representation or (ii) fraud, willful misconduct or intentional
breach by any Company Stockholder; provided, however, that the foregoing shall
not be construed to restrict Parent from seeking specific performance or
injunctive relief to enforce any Agreement Not to Compete.  In connection with
any Damages arising out of (i) or (ii):  (A) Indemnified Persons will be
required to first offset against the Holdback Shares prior to making a claim
against any Company Stockholder individually; and (B) in no event will any
Company Stockholder have any personal liability above and beyond the shares of
Parent Common Stock actually received by such Company Stockholder.
 
Section 8.3.3         Damages that may be recovered under this Article 8 shall
take account of and be reduced by (i) any amounts actually recovered by the
Indemnified Persons pursuant to any indemnification by, or indemnification
agreement with, any third party, and (ii) the amount of any insurance proceeds,
contribution payments or reimbursements actually received by the Indemnified
Person in respect thereof.
 
Section 8.4          Adjustment to Holdback Shares.
 
Section 8.4.1        Compensation of Indemnified Parties.  The Holdback Shares
shall be available to compensate any Indemnified Person for any Damages (whether
or not involving a third party claim), incurred or sustained by such Indemnified
Party.  The parties agree that the value of each Holdback Shares shall be equal
to the Fair Market Value thereof.  Each Company Stockholder shall be deemed to
own a fixed percentage of the Holdback Shares for Tax purposes as set forth in
the Spreadsheet.
 
 
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Section 8.4.2        Procedures.  Upon receipt by the Stockholders’
Representative, at any time on or before the Indemnity Termination Date, of
written notice from Parent (a “Claim Notice”) (a) stating that an Indemnified
Party in good faith has paid or properly accrued or reasonably anticipates that
it will have to pay or accrue Damages, and (b) specifying in reasonable detail
the individual items of Damages included in the amount so stated, the date each
such item was paid or properly accrued, or the basis for such anticipated
liability, the Stockholders’ Representative shall have thirty (30) days to
review and, if he disagrees with any matter set forth in the Claim Notice,
object in writing to such Claim Notice.  In case the Stockholders’
Representative shall not object in writing to any claim or claims made in any
Claim Notice within such thirty (30) day period, the Company and the Company
Stockholders shall be deemed to have agreed to the Claim Notice and to the
reduction of the Holdback Shares as set forth therein.  Delivery of a Claim
Notice shall not foreclose or limit any other remedy available to a Parent
Indemnified Person under this Agreement, at Law or in equity.
 
Section 8.4.3         Resolution of Disputes.  In case the Stockholders’
Representative shall object in writing to any claim or claims made in any Claim
Notice within the thirty (30) day period specified in Section 8.4.2, the
Stockholders’ Representative and Parent shall attempt in good faith to agree
upon the rights of the respective parties with respect to each of such
claims.  If the Stockholders’ Representative and Parent should so agree, such
agreement shall be set forth in writing and signed by both parties.  If no such
agreement can be reached after good faith negotiation, either Parent or the
Stockholders’ Representative may pursue all remedies available to it under this
Agreement, at Law or in equity.
 
Section 8.4.4         Change in Control of Parent.  In the event of (A) any
merger or consolidation of Parent into or with another corporation, (B) any sale
of all or substantially all of the assets of Parent, following which any cash,
securities or other property is paid or issued to stockholders of Parent, (C)
any liquidation or dissolution of Parent in which any cash, securities or other
property is distributed to the stockholders of Parent, or (D) any stock exchange
involving Parent Shares, between the date hereof and the Holdback Termination
Date, then any cash, securities and other property which the holders of the
Holdback Shares shall be entitled to otherwise receive as a result of any such
event shall be held back and shall become part of the Holdback Shares.  If
Parent issues any cash or additional shares upon any dividend, stock split,
stock dividend or other distribution affecting the Parent Shares , such cash or
securities otherwise issuable or distributable with respect to the Holdback
Shares shall be held back and shall become part of the Holdback Shares.
 
Section 8.5          Third-Party Claims.
 
Section 8.5.1         By written notice within fifteen (15) days following the
delivery of a Claim Notice with respect to a third party claim (a “Third Party
Claim”), the Stockholders’ Representative may, upon written acknowledgment
without qualification of the right to the Indemnified Person to be indemnified
for Damages incurred in connection with such Third Party Claim, be entitled to
defend the Third Party Claim through counsel of the Stockholders’
Representative’s choice (and reasonably acceptable to the Indemnified Person) at
the expense of the Company Stockholders to represent the Indemnified Person in
connection with such Third Party Claim (in which case the fees and expenses of
any separate counsel retained by any Indemnified Person shall not be
Damages).  The Stockholders’ Representative shall not consent to the entry of
any judgment or enter into any settlement without the consent of the Indemnified
Person, such consent not to be unreasonably withheld.  The Indemnified Person
shall have the right to participate at its own expense in the defense of such
asserted liability, but shall not be entitled to settle or compromise such
asserted liability without the prior written consent of the Stockholders’
Representative, such consent not to be unreasonably withheld.  Notwithstanding
the foregoing, if the Indemnified Person reasonably determines there is a
conflict of interest in connection with the Stockholders’ Representative’s
defense of a Third Party Claim, the Indemnified Person (and not the
Stockholders’ Representative) shall have the right to defend such claim and to
be indemnified by the Company Stockholders for its Damages incurred in
connection therewith.
 
 
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Section 8.5.2        If the Stockholders’ Representative has the right to and
elects to defend any Third Party Claim, the Stockholders’ Representative shall
(i) promptly submit to the Indemnified Person copies of all pleadings,
responsive pleadings, motions and other similar legal documents and papers
received or filed in connection therewith, (ii) permit the Indemnified Person
and its counsel to confer on the conduct of the defense thereof, and (iii) to
the extent practicable, permit the Indemnified Person and its counsel an
opportunity to review all legal papers to be submitted prior to their
submission.  The parties hereto agree to reasonably cooperate with each other in
connection with the defense, negotiation or settlement of any Third Party Claim,
including by providing access to each other’s relevant business records and
other documents and employees.
 
Section 8.5.3        Notwithstanding the provisions of Section 8.5.1, the
Stockholders’ Representative shall not be entitled to assume the defense of any
Third Party Claim that (i) relates to or arises in connection with a criminal
action or an action brought by a Governmental Entity, (ii) seeks an injunction
or equitable relief against the Indemnified Person, or (iii) has a reasonable
likelihood of resulting in Damages that would exceed the Fair Market Value of
the balance of the Holdback Shares.
 
Section 8.6          Stockholders’ Representative.
 
Section 8.6.1        Each Company Stockholder by virtue of the approval and
adoption of this Agreement or other appointment authorization documentation
(other than such Company Stockholders, if any, who have perfected appraisal
rights under Delaware Law or California Law) or by accepting any consideration
payable hereunder shall be deemed to have agreed to appoint CommerceNet as its
agent and attorney-in-fact (the “Stockholders’ Representative ”) for and on
behalf of the Company Stockholders to act for the Company Stockholders with
regard to matters pertaining to Article 8 and Article 9, give and receive
notices and communications, authorize offset of the Holdback Shares in
satisfaction of claims by any Indemnified Person, object to such payments, agree
to, negotiate, enter into settlements and compromises of, and comply with orders
of courts with respect to such claims, assert, negotiate, enter into settlements
and compromises of, and comply with orders of courts with respect to, any other
claim by any Indemnified Person relating to this Agreement or the transactions
contemplated hereby and to take all other actions that are either (i) necessary
or appropriate in the judgment of the Stockholders’ Representative for the
accomplishment of the foregoing or (ii) specifically mandated by the terms of
this Agreement.  Each Company Stockholder agrees to receive correspondence from
the Stockholders’ Representative, including in electronic form.  Such agency may
be changed by the Company Stockholders with the right to receive a majority of
the Holdback Shares from time to time.  Notwithstanding the foregoing, the
Stockholders’ Representative may resign at any time by providing written notice
of intent to resign to the Company Stockholders, which resignation shall be
effective upon the earlier of (A) thirty (30) calendar days following delivery
of such written notice or (B) the appointment of a successor by the holders of a
majority in interest of the Holdback Shares.  If the Stockholders’
Representative shall be removed, resign or otherwise be unable to fulfill his
responsibilities hereunder, the Company Stockholders shall appoint a successor
to the Stockholders’ Representative, and shall immediately thereafter notify
Parent the identity of such successor.  Any such successor shall succeed the
former Stockholders’ Representative as the Stockholders’ Representative
hereunder.  No bond shall be required of the Stockholders’ Representative, and
the Stockholders’ Representative shall not receive any compensation for his
services.  A decision, act, consent or instruction of the Stockholders’
Representative, including an amendment, extension or waiver of this Agreement
pursuant to its authority hereunder, shall constitute a decision of the Company
Stockholders and shall be final, binding and conclusive upon the Company
Stockholders.
 
 
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Section 8.6.2        By executing this Agreement under the heading
“Stockholders’ Representative,” CommerceNet hereby (i) accepts its appointment
and authorization to act as Stockholders’ Representative  as attorney-in-fact
and agent on behalf of the Company Stockholders in accordance with the terms of
this Agreement, and (ii) agrees to perform his obligations under, and otherwise
comply with, this Section 8.6.
 
Section 8.6.3         The Stockholders’ Representative shall not be liable to
any Company Stockholder for any act done or omitted hereunder as the
Stockholders’ Representative without gross negligence or willful misconduct or
bad faith (and any act done or omitted pursuant to the bona fide good faith
advice of counsel, accountants and other professionals and experts retained by
the Stockholders’ Representative shall be conclusive evidence of good
faith).  To the fullest extent permitted by applicable Law, the Company
Stockholders shall severally indemnify the Stockholders’ Representative and hold
him harmless against any loss, liability or expense incurred without gross
negligence, willful misconduct or bad faith on the part of the Stockholders’
Representative and arising out of or in connection with the acceptance or
administration of his duties hereunder, including any out-of-pocket costs and
expenses and legal fees and other legal costs reasonably incurred by the
Stockholders’ Representative.  If not paid directly to the Stockholders’
Representative by the Company Stockholders, such losses, liabilities or expenses
may be recovered by the Stockholders’ Representative from the Holdback Shares
otherwise distributable to the Company Stockholders (and not distributed or
distributable to an Indemnified Person or subject to a pending indemnification
claim of an Indemnified Person) after the Indemnity Termination Date, pursuant
to the terms hereof at the time of distribution.  The Stockholders’
Representative shall only have the duties expressly stated in this Agreement and
shall have no other duty, express or implied.  The Stockholders’ Representative
may engage attorneys, accountants, investment bankers, advisors, consultants and
clerical personnel and obtain such other professional and expert assistance, and
maintain such records, as the Stockholders’ Representative may deem necessary or
desirable and incur other out-of-pocket expenses related to performing his
services hereunder.  The Stockholders’ Representative  may in good faith rely
conclusively upon information, reports, statements and opinions prepared or
presented by such professionals, and any action taken by the Stockholders’
Representative  based on such reliance shall be deemed conclusively to have been
taken in good faith.
 
Section 8.6.4        All of the immunities and powers granted to the
Stockholders’ Representative under this Agreement shall survive the Effective
Time and/or any termination of this Agreement.  The grant of authority provided
for in this Section 8.6: (i) is coupled with an interest and shall be
irrevocable and survive the death, incompetence, bankruptcy or liquidation of
the respective Company Stockholder and shall be binding on any successor
thereto; and (ii) shall survive the delivery of an assignment by any Company
Stockholder of the whole or any fraction of his, her or its interest in the
Holdback Shares.
 
 
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Section 8.6.5        Parent and the Surviving Corporation shall be entitled to
rely upon the actions of the Stockholders’ Representative as the duly authorized
actions of the Company Stockholders.
 
Section 8.7         Indemnity Termination.  On the Indemnity Termination Date,
Parent shall release all of the Holdback Shares not subject to a pending
indemnification claim of an Indemnified Person to the Exchange Agent for
distribution to the Company Stockholders as set forth on the Spreadsheet.
 
Section 8.8         Tax Treatment of Indemnity Payments.  The Company
Stockholders and Parent agree to treat any indemnity payment made pursuant to
this Agreement as an adjustment to the consideration payable to the Company
Stockholders under this Agreement for all income Tax purposes.
 
Article 9.
General Provisions
 
Section 9.1         Notices.  Any notices or other communications required or
permitted under, or otherwise in connection with this Agreement, shall be in
writing and shall be deemed to have been duly given when delivered in person or
upon confirmation of receipt when transmitted by facsimile transmission (but
only if followed by transmittal by national overnight courier or hand for
delivery on the next business day) or on receipt after dispatch by registered or
certified mail, postage prepaid, addressed, or on the next business day if
transmitted by national overnight courier, in each case as follows:
 
If to Parent or Merger Sub, addressed to it at:
 
Tegal Corporation
140 2nd Street, Suite 318
Petaluma, CA 94952
Attention:  Thomas R. Mika
 
with a copy to:
 
Goodwin Procter LLP
135 Commonwealth Drive
Menlo Park, CA 94025
Attention:  William Davisson

If to the Company, addressed to it at:
 
CollabRx, Inc.
169 University Avenue
Palo Alto, CA 94301
Attention:  James Karis
 
 
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with a copy to:
 
Wilson Sonsini Goodrich & Rosati PC
650 Page Mill Road
Palo Alto, CA 94304-1050
Attention:  Allison Spinner
 
Section 9.2          Certain Definitions.  For purposes of this Agreement, the
term:
 
“affiliate” means a person that directly or indirectly, through one or more
intermediaries, controls, is controlled by, or is under common control with, the
first-mentioned person;
 
“Acquisition Proposal” means any offer or proposal concerning any (A) merger,
consolidation, business combination or similar transaction involving the
Company, (B) sale, lease or other disposition directly or indirectly by merger,
consolidation, business combination, share exchange, joint venture or otherwise
of a material portion of the Company’s assets, (C) issuance, sale or other
disposition of (including by way of merger, consolidation, business combination,
share exchange, joint venture or any similar transaction) securities (or
options, rights or warrants to purchase, or securities convertible into or
exchangeable for such securities) representing 10% or more of the voting power
of the Company or (D) transaction in which any person shall acquire beneficial
ownership, or the right to acquire beneficial ownership or any group shall have
been formed which beneficially owns or has the right to acquire beneficial
ownership of 10% or more of the outstanding voting capital stock of the Company
or (E) any combination of the foregoing (other than the Merger).
 
“Agreement Not to Compete” means an Agreement Not to Compete in the form
attached hereto as Exhibit A.
 
“Ancillary Agreements” means the Agreements Not to Compete and the Stockholders
Agreement.
 
“beneficial ownership” (and related terms such as “beneficially owned” or
“beneficial owner”) has the meaning set forth in Rule 13d-3 under the Exchange
Act.
 
“Blue Sky Laws” means state securities or “blue sky” Laws.
 
“business day” means any day other than a day on which the SEC shall be closed.
 
“CERCLA” means the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended as of the date of this Agreement.
 
“Change of Control Obligations” means, without duplication, all amounts (plus
any associated withholding Taxes or any Taxes required to be paid by the Company
with respect thereto) which the Company is obligated to pay under any change of
control, termination, salary continuation, retention, severance or other similar
plan, agreement or arrangement in connection with the Merger and the other
transactions contemplated by this Agreement.
 
 
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“Closing Shares” means the shares of Parent Common Stock issuable to Company
Stockholders pursuant to this Agreement excluding the Holdback Shares.
 
“Company Material Adverse Effect” means any change affecting, or condition
having an effect on, the Company that is, or would reasonably be expected to be,
materially adverse to the assets, liabilities, business, condition (financial or
otherwise), results of operations or prospects of the Company and CC IP Holdings
LLC, taken as a whole, other than any changes or conditions having an effect on
the Company that would not have occurred but for: (A) changes in economic
conditions generally, (B) changes in general political conditions, including any
acts of war or terrorist activities or (C) changes resulting from the
announcement of the transactions contemplated by this Agreement, so long as in
each of the cases set forth in clauses (A) and (B), the Company is not
disproportionately affected by such changes as compared to other companies in
the Company’s industry.
 
“Company Stockholder” means a holder of Company Capital Stock (other than any
Dissenting Shares and any shares of Company Capital Stock to be canceled
pursuant to Section 2.1.3) immediately prior to the Effective Time.
 
“contract” means any oral or written agreement, contract, lease, power of
attorney, note, loan, evidence of indebtedness, purchase order, letter of
credit, settlement agreement, franchise agreement, undertaking, covenant not to
compete, employment agreement, license, instrument, obligation, commitment,
understanding, policy, purchase or sale order, quotation or other executory
commitment, in each case which is in effect as of the date hereof.
 
“control” (including the terms “controlled by” and “under common control with”)
means the possession, directly or indirectly or as trustee or executor, of the
power to direct or cause the direction of the management or policies of a
person, whether through the ownership of stock or as trustee or executor, by
contract or credit arrangement or otherwise.
 
“Dissenting Shares” shall mean any shares of Company Capital Stock that are
issued and outstanding immediately prior to the Effective Time and in respect of
which appraisal rights have been perfected in accordance with Delaware Law or
California Law in connection with the Merger.
 
“Environmental Laws” means any federal, state, local or foreign statute, Law,
ordinance, regulation, rule, code, treaty, writ or order and any enforceable
judicial or administrative interpretation thereof, including any judicial or
administrative order, consent decree, judgment, stipulation, injunction, permit,
authorization, policy, opinion, or agency requirement, in each case having the
force and effect of Law, relating to the pollution, protection, investigation or
restoration of the environment, health and safety as affected by the environment
or natural resources, including, without limitation, those relating to the use,
handling, presence, transportation, treatment, storage, disposal, release,
threatened release or discharge of Hazardous Materials or noise, odor, wetlands,
pollution or contamination.
 
“Environmental Permits” means any permit, approval, identification number,
license and other authorization required under any applicable Environmental Law.
 
 
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“Equity Interest” means any share, capital stock, partnership, member or similar
interest in any entity, and any option, warrant, right or security (including
debt securities) convertible, exchangeable or exercisable therefor.
 
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended,
and the regulations promulgated thereunder.
 
“ERISA Affiliate” shall mean any entity or trade or business (whether or not
incorporated) other than the Company that together with the Company is
considered under common control and treated as a single employer under Section
4.14(b), (c), (m) or (o) of the Code.
 
“Exchange” means the Nasdaq Capital Market.
 
“Exchange Act” shall mean Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder.
 
“Fair Market Value” means, with respect to the Parent Common Stock, the average
of the closing prices of the Parent Common Stock on the Exchange over the ten
(10) trading day period ending five (5) trading days prior to the Effective
Time.
 
“GAAP” means generally accepted accounting principles as applied in the United
States.
 
“Governmental Entity” means a domestic or foreign governmental, administrative,
judicial or regulatory authority.
 
“group” is defined as in the Exchange Act, except where the context otherwise
requires.
 
“Hazardous Materials” means (A) any petroleum, petroleum products, byproducts or
breakdown products, radioactive materials, asbestos-containing materials or
polychlorinated biphenyls or (B) any chemical, material or other substance
defined or regulated as toxic or hazardous or as a pollutant or contaminant or
waste under any applicable Environmental Law.
 
“Indebtedness” means, without duplication, (a) all indebtedness of the Company
for borrowed money or indebtedness issued or incurred in substitution or
exchange for borrowed money (other than trade debt incurred in the ordinary
course of business), (b) all obligations of the Company evidenced by notes,
bonds, debentures or similar instruments, (c) all obligations of the Company
under any derivative financial instruments, including any interest rate or
currency swap transactions, hedging agreements or similar arrangements (valued
at the termination value thereof), (d) all amounts owing as deferred or unpaid
purchase price by the Company for any asset or property, (e) commitments or
obligations by the Company assuring a creditor against loss (including
contingent reimbursement obligations with respect to letters of credit), (f)
indebtedness secured by an encumbrance on any asset or property of the Company,
(g) obligations of the Company with respect to capitalized leases, determined in
accordance with GAAP, (h) all obligations of the Company for bankers’
acceptances or similar credit transactions, (i) any obligation of the Company to
third parties under letters of credit, bonds or surety obligations, (j)
guarantees by the Company with respect to any indebtedness, obligation, claim or
liability of any other Person of a type described in clauses (a) through (i)
above or any “keep well” or other agreement by the Company to maintain any
financial statement condition of any other Person, (k) any unpaid interest,
fees, costs or expenses incurred in connection with any Indebtedness specified
in clauses (a) through (j) above or under any related facility, or (m) any early
termination or repayment penalties reasonably anticipated to be incurred upon
the termination or repayment in full, on or about the Effective Time, of any
Indebtedness specified in clauses (a) through (k) above and any related
facility.
 
 
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“Intellectual Property” means all intellectual property, and related
intellectual property rights or other proprietary rights of every kind, foreign
or domestic, including all patents, patent applications, software,
documentation, works of authorship, inventions (whether or not patentable),
confidential information, algorithms, tools (including decision tools and
weighting tools), trade secrets, trademarks, trademark registrations and
applications, domain names, service marks, service mark registrations and
applications, trade names, trade dress, and copyright registrations and
applications.
 
“IRS” means the United States Internal Revenue Service.
 
“Key Employee” means any executive-level employee (including division director
and vice president-level positions) as well as any employee or consultant who
either alone or in concert with others develops, invents, programs or designs
any Company Intellectual Property.
 
“Knowledge” means, with respect to the Company or Parent, the actual knowledge
of the officers of the Company or Parent, as the case may be, after reasonable
inquiry of the Persons who would reasonably be expected to actually be aware of
such fact or other matter.
 
“Law” means foreign or domestic law, statute, code, ordinance, rule, regulation,
order, judgment, writ, stipulation, award, injunction, decree or arbitration
award or finding.
 
“Parent Material Adverse Effect” means any change affecting, or condition having
an effect on Parent that is, or would reasonably be expected to be, materially
adverse to the assets, liabilities, business, condition (financial or otherwise)
or results of operations of Parent, other than any changes or conditions having
an effect on Parent that would not have occurred but for: (A) changes in
economic conditions generally, (B) changes in general political conditions,
including any acts of war or terrorist activities or (C) changes resulting from
the announcement of the transactions contemplated by this Agreement, so long as
in each of the cases set forth in clauses (A) and (B), Parent is not
disproportionately affected by such changes as compared to other companies in
Parent’s industry.
 
“Pre-Closing Taxes” means all Taxes of the Company for taxable periods ending on
or before the Effective Time and the portion up to and including the Effective
Time for any taxable period that includes (but does not end on) the Effective
Time.  In the case of any taxable period that includes (but does not end on) the
Effective Time, the amount of Pre-Closing Taxes with respect to such period
shall (i) in the case of Taxes that are imposed on a periodic basis (such as
real property Taxes), be deemed to be the amount of such Taxes for the entire
period multiplied by a fraction the numerator of which is the number of calendar
days in the portion of the period ending on (and including) the Effective Time
and the denominator of which is the number of calendar days in the taxable
period and (ii) in the case of Taxes that are not described in clause (i) above
(such as income Taxes and payroll and similar Taxes), be deemed to be equal to
the amount that would have been payable if the taxable year or period of the
Company ended on the Effective Time.
 
 
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“Preference Shares” means the aggregate number of shares of Parent Common Stock
with a Fair Market value equal to the product of (a) the Preferred Liquidation
Preference multiplied by (b) the number of shares of Company Preferred Stock
that are issued and outstanding immediately prior to the Effective Time (other
than shares of Company Preferred Stock to be canceled pursuant to Section
2.1.3).
 
“Preferred Liquidation Preference” means $0.25625 per share of Company Preferred
Stock plus an amount equal to all declared but unpaid dividends on the Company
Preferred Stock (subject to adjustment for an stock dividend, stock split,
combination of shares, reorganization, recapitalization, reclassification or
other similar event occurring after the date of this Agreement).
 
“Related Party” means any of the Company’s (a) directors, officers or affiliates
and (b) any officers, directors, partners, members, affiliates or members of the
immediate family of any of the persons set forth in clause (a).  For purposes
the foregoing, immediate family means, with respect to any person, such person’s
spouse, parents, children and siblings or any other relative of such person that
shares such person’s principal residence.
 
“Remainder Per Share Amount” means the quotient obtained by dividing (a)(i) the
Merger Consideration Shares minus (ii) the Preference Shares by (b) the Total
Stock.
 
“Replacement Note” means a promissory note in the form attached hereto as
Exhibit B.
 
 “SEC” means the Securities and Exchange Commission.
 
“Securities Act” means the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder.
 
“Stockholders Agreement” means the Stockholders Agreement among the Company and
certain of the Company Stockholders, in the form attached hereto as Exhibit C.
 
“Taxes” means any and all taxes, fees, levies, duties, tariffs, imposts and
other charges of any kind (together with any and all interest, penalties,
additions to tax and additional amounts imposed with respect thereto) imposed by
any Governmental Entity or domestic or foreign taxing authority, including,
without limitation, income, franchise, windfall or other profits, gross
receipts, property, sales, use, net worth, capital stock, payroll, employment,
social security, workers’ compensation, unemployment compensation, excise,
withholding, ad valorem, stamp, transfer, value-added, gains tax and license,
registration and documentation fees.
 
 
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“Tax Returns” means any report, return (including information return), claim for
refund, election, estimated tax filing or declaration required to be supplied to
any Governmental Entity or domestic or foreign taxing authority with respect to
Taxes, including any schedule or attachment thereto, and including any
amendments thereof.
 
“Total Stock” means the aggregate number of shares of Company Capital Stock that
are issued and outstanding immediately prior to the Effective Time (other than
shares of Company Capital Stock to be canceled pursuant to Section 2.1.3).
 
“Transaction Expenses” means all third party fees and expenses incurred by the
Company in connection with the process of selling the Company, including,
without limitation, the Merger and this Agreement and the transactions
contemplated hereby (including any fees and expenses of legal counsel, financial
advisors and consultants, investment bankers, brokers, accountants and tax
advisors of the Company and any such fees incurred by holders of Company Capital
Stock paid for or to be paid for by the Company).
 
Section 9.3          Terms Defined Elsewhere.  The following terms are defined
elsewhere in this Agreement, as indicated below:
 
“Agreement”
Preamble
   
“Annual Financial Statements”
Section 3.7
   
“App”
Section 3.17
   
“Basket”
Section 8.3.1
   
“California Law”
Recitals
   
“Certificate of Merger”
Section 1.2
   
“Certificates”
Section 2.3.2
   
“Change of Control Obligations Statement”
Section 2.10
   
“Claim Notice”
Section 8.4.2
   
“Closing Indebtedness Statement”
Section 2.10
   
“Code”
Recitals
   
“Common Exchange Ratio”
Section 2.1.1
   
“Company”
Preamble
   
“Company Benefit Plan”
Section 3.9.1

 
 
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"Company Board"
Section 3.4.1
   
“Company Bylaws”
Section 3.2
   
“Company Capital Stock”
Section 2.1.1
   
“Company Certificate”
Section 3.2
   
“Company Common Stock”
Section 2.1.1
   
“Company Disclosure Schedule”
Article 3
   
“Company Intellectual Property”
Section 3.15
   
“Company IP Agreements”
Section 3.15
   
“Company Options”
Section 2.5
   
“Company Permits”
Section 3.6
   
“Company Preferred Stock”
Section 2.1.1
   
“Company Representatives”
Section 5.5.1
   
“Company Warrants”
Section 2.6
   
“Confidentiality Agreement”
Section 5.5.2
   
“Continuing Employee”
Section 5.12
   
“Damages”
Section 8.2
   
“Delaware Law”
Recitals
   
“Effective Time”
Section 1.2
   
“Estimated Balance Sheet”
Section 2.9
   
“Exchange Agent”
Section 2.3.1
   
“Exchange Fund”
Section 2.3.1
   
“Financial Statements”
Section 3.7
   
“Fundamental Representations”
Section 8.1
   
“Holdback Shares”
Section 2.1.2.1

 
 
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“Holdback Termination Date”
Section 2.1.2.1
   
“Indemnified Person”
Section 8.2
   
“Indemnity Termination Date”
Section 8.1
   
“Interim Financial Statements”
Section 3.7
   
“Material Contract”
Section 3.12
   
“Merger”
Recitals
   
“Merger Consideration Shares”
Section 2.11
   
“Merger Sub”
Preamble
   
“Multiemployer Plan”
Section 3.9.3
   
“Parent”
Preamble
   
“Parent Benefit Plans”
Section 5.11
   
“Parent Bylaws”
Section 4.2
   
“Parent Certificate”
Section 4.2
   
“Parent Capital Stock”
Section 4.3
   
“Parent Common Stock”
Section 2.1.1
   
“Parent Form 10-K”
Section 4.2
   
“Parent Preferred Stock”
Section 4.3
   
“Parent Representatives”
Section 5.5.1
   
“Parents Rights”
Section 2.1.1
   
“Parents Rights Agreement”
Section 2.1.1
   
“Parent SEC Filings”
Section 4.7.1
   
“Parent Subsidiary”
Section 4.5.1
   
“PBGC”
Section 3.9.4
   
“Preferred Exchange Ratio”
Section 2.1.1
   
“Requisite Stockholder Approval”
Section 3.21
   
“Spreadsheet”
Section 2.8

 
 
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“Stockholder Consents”
Recitals
   
“Stockholders’ Representative”
Section 8.4.4
   
“Surviving Corporation”
Section 1.1
   
“Third Party Claim”
Section 8.6.1
   
“Transaction Expenses Statement”
Section 2.10

 
Section 9.4          Headings.  The headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
 
Section 9.5          Severability.  If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any rule of Law
or public policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
materially adverse to any party.  Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the parties hereto
shall negotiate in good faith to modify this Agreement so as to effect the
original intent of the parties as closely as possible in an acceptable manner to
the end that transactions contemplated hereby are fulfilled to the extent
possible.
 
Section 9.6         Entire Agreement.  This Agreement (together with the
Exhibits, Parent and Company Disclosure Schedules and the other documents
delivered pursuant hereto), each Ancillary Agreement and the Confidentiality
Agreement constitute the entire agreement of the parties and supersede all prior
agreements and undertakings, both written and oral, between the parties, or any
of them, with respect to the subject matter hereof and, except as otherwise
expressly provided herein, are not intended to confer upon any other person any
rights or remedies hereunder.
 
Section 9.7          Assignment.  This Agreement shall not be assigned by
operation of law or otherwise.
 
Section 9.8         Parties in Interest.  This Agreement shall be binding upon
and inure solely to the benefit of each party hereto and their respective
successors and assigns, and nothing in this Agreement, express or implied, other
than pursuant to Section 5.13, is intended to or shall confer upon any other
person any right, benefit or remedy of any nature whatsoever under or by reason
of this Agreement.
 
Section 9.9         Mutual Drafting.  Each party hereto has participated in the
drafting of this Agreement, which each party acknowledges is the result of
extensive negotiations between the parties.
 
 
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Section 9.10       Governing Law; Consent to Jurisdiction; Waiver of Trial by
Jury.
 
Section 9.10.1      This Agreement shall be governed by, and construed in
accordance with, the Laws of the State of Delaware, without regard to laws that
may be applicable under conflicts of laws principles.
 
Section 9.10.2      Each of the parties hereto hereby irrevocably and
unconditionally submits, for itself and its property, to the exclusive
jurisdiction of any Delaware State court, or Federal court of the United States
of America, sitting in Delaware, and any appellate court from any thereof, in
any action or proceeding arising out of or relating to this Agreement or the
agreements delivered in connection herewith or the transactions contemplated
hereby or thereby or for recognition or enforcement of any judgment relating
thereto, and each of the parties hereby irrevocably and unconditionally (A)
agrees not to commence any such action or proceeding except in such courts, (B)
agrees that any claim in respect of any such action or proceeding may be heard
and determined in such Delaware State court or, to the extent permitted by law,
in such Federal court, (C) waives, to the fullest extent it may legally and
effectively do so, any objection which it may now or hereafter have to the
laying of venue of any such action or proceeding in any such Delaware State or
Federal court, and (D) waives, to the fullest extent permitted by law, the
defense of an inconvenient forum to the maintenance of such action or proceeding
in any such Delaware State or Federal court.  Each of the parties hereto agrees
that a final judgment in any such action or proceeding shall be conclusive and
may be enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law.  Each party to this Agreement irrevocably consents to
service of process in the manner provided for notices in Section 9.1.  Nothing
in this Agreement will affect the right of any party to this Agreement to serve
process in any other manner permitted by law.
 
Section 9.10.3      EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY
WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND
DIFFICULT ISSUES, AND THEREFORE IT HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES
ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY
OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT AND ANY OF THE
AGREEMENTS DELIVERED IN CONNECTION HEREWITH OR THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY.  EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (A) NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK
TO ENFORCE EITHER OF SUCH WAIVERS, (B) IT UNDERSTANDS AND HAS CONSIDERED THE
IMPLICATIONS OF SUCH WAIVERS, (C) IT MAKES SUCH WAIVERS VOLUNTARILY, AND (D) IT
HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL
WAIVERS AND CERTIFICATIONS IN THIS SECTION 9.10.3.
 
Section 9.11       Disclosure.  Any matter disclosed in any section of a party’s
Disclosure Schedule shall be considered disclosed for other sections of such
Disclosure Schedule, but only to the extent such matter on its face would
reasonably be expected to be pertinent to a particular section of a party’s
Disclosure Schedule in light of the disclosure made in such section.  The
provision of monetary or other quantitative thresholds for disclosure does not
and shall not be deemed to create or imply a standard of materiality hereunder.
 
 
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Section 9.12       Counterparts.  This Agreement may be executed in one or more
counterparts, and by the different parties hereto in separate counterparts, each
of which when executed shall be deemed to be an original but all of which taken
together shall constitute one and the same agreement.
 
Section 9.13       Specific Performance.  The parties hereto agree that
irreparable damage would occur in the event that any of the provisions of this
Agreement were not performed in accordance with their specific terms or were
otherwise breached.  It is accordingly agreed that the parties shall be entitled
to an injunction or injunctions to prevent breaches of this Agreement and to
enforce specifically the terms and provisions hereof in any court of the United
States or any state having jurisdiction, this being in addition to any other
remedy to which they are entitled at law or in equity.
 
(Signature Page Follows)
 
 
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IN WITNESS WHEREOF, Parent, Merger Sub and the Company have caused this
Agreement and Plan of Merger to be executed as of the date first written above
by their respective officers thereunto duly authorized.
 

 
TEGAL CORPORATION
   
 
 
     
By:
     
Name:
   
Title:
   
 
 
     
CLBR ACQUISITION CORP.
   
 
 
     
By:
     
Name:
   
Title
   
 
 
     
COLLABRX, INC.
   
 
 
     
By:
     
Name:
   
Title:
   
 
 
     
STOCKHOLDERS’ REPRESENTATIVE
                 
Name:
 

 
 
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