Exhibit 10.1

AGREEMENT AND PLAN OF MERGER

among

NOVEN PHARMACEUTICALS, INC.,

NOVEN ACQUISITION, LLC,

and

JDS PHARMACEUTICALS, LLC

Dated as of July 9, 2007

1

TABLE OF CONTENTS

Page

                 
ARTICLE I. DEFINITIONS
    2          
 
               
Section 1.1.Certain Definitions
    2          
Section 1.2.Terms Generally
    11          
ARTICLE II. MERGER
    11          
Section 2.1.The Merger
    11          
Section 2.2.Closing
    11          
Section 2.3.Effective Time of the Merger
    11          
Section 2.4.Effect of Merger
    12          
Section 2.5.Further Actions
    12          
Section 2.6.Organizational Documents
    12          
Section 2.7.Officers
    12          
ARTICLE III. CONVERSION OF UNITS
    12          
Section 3.1.Merger Consideration
    12          
Section 3.2.Escrow Amount
    13          
Section 3.3.Payment
    13          
Section 3.4.No Further Rights
    15          
Section 3.5.Closing of the Company’s Transfer Books
    15          
Section 3.6.Closing Deliveries
    15          
Section 3.7.Adjustment to Merger Consideration
    16          
Section 3.8.Satisfaction of Conditions
    17          
Section 3.9.Transfer Taxes
    17          
ARTICLE IV. REPRESENTATIONS AND WARRANTIES REGARDING THE COMPANY GROUP
            17  
Section 4.1.Organization of the Company and the Company Group
    17          
Section 4.2.Authorization
    18          
Section 4.3.Noncontravention
    18          
Section 4.4.Capitalization
    18          
Section 4.5.Subsidiaries of the Company
    20          
Section 4.6.Consents, Government Authorizations
    20          
Section 4.7.Financial Statements
    20          
Section 4.8.Absence of Certain Changes
    20          
Section 4.9.Tax Matters
    21          
Section 4.10.Real Property
    22          
Section 4.11.Intellectual Property
    22          
Section 4.12.Environmental Matters
    23          
Section 4.13.Contracts
    23          
Section 4.14.Insurance
    25          
Section 4.15.Litigation
    26          
Section 4.16.Employee Matters
    26          
Section 4.17.Legal Compliance
    28          
Section 4.18.Brokers’ Fees
    28          
Section 4.19.Permits
    28          
Section 4.20.Transaction with Affiliates; Ownership of Assets
    28          
Section 4.21.No Additional Representations and Warranties
    29          
ARTICLE V. REPRESENTATIONS AND WARRANTIES REGARDING BUYER AND MERGER SUB
            29  
Section 5.1.Organization
    29          
Section 5.2.Authorization
    29          
Section 5.3.Noncontravention
    29          
Section 5.4.Consents, Government Authorizations
    30          
Section 5.5.Financial Capacity
    30          
Section 5.6.Litigation
    30          
Section 5.7.Brokers’ Fees
    30          
Section 5.8.Information
    30          
ARTICLE VI. COVENANTS
    31          
Section 6.1.Conduct of the Company
    31          
Section 6.2.Access to Information; Confidentiality
    33          
Section 6.3.Efforts
    34          
Section 6.4.Approvals
    34          
Section 6.5.Public Announcements
    35          
Section 6.6.Notification of Certain Matters
    35          
Section 6.7.Director and Officer Indemnification
    35          
Section 6.8.Employee Benefit Arrangements
    36          
Section 6.9.Post-Closing Access; Preservation of Records
    37          
Section 6.10.Further Assurances
    37          
Section 6.11.No Solicitation
    37          
Section 6.12.Supplemental Disclosure
    38          
Section 6.13.Tax Treatment of Transactions.
    38          
Section 6.14.Purchase Price Allocation.
    38          
ARTICLE VII. CONDITIONS TO CLOSING
    39          

      Section 7.1. Condition Precedent to Obligations of Buyer, Merger Sub and
the Company 39  

                 
 
  Section 7.2.Conditions Precedent to Obligation of the Company     40  
 
  Section 7.3.Conditions Precedent to Obligations of Buyer and Merger Sub     40
  ARTICLE VIII. INDEMNIFICATION
    41  
 
  Section 8.1.Survival     41  
 
  Section 8.2.Indemnification     42  
 
  Section 8.3.Indemnification Procedures     43  
 
  Section 8.4.Limitation on Liability     45  
 
  Section 8.5.Calculation of Damages     45  
 
  Section 8.6.Exclusive Remedy     46  
 
  Section 8.7.Access     46  
 
  Section 8.8.Mitigation of Damages     46  
 
  Section 8.9.Certain Damages     46  
 
  Section 8.10.Release of Escrow Amount     46   ARTICLE IX. MEMBER
REPRESENTATIVE
    47  
 
  Section 9.1.Member Representative     47  
 
  Section 9.2.Authority and Rights     47  
 
  Section 9.3.Limitations on Liability     48  
ARTICLE X. TERMINATION
            49  
 
  Section 10.1.Termination Events     49  
 
  Section 10.2.Effect of Termination     49  
ARTICLE XI. MISCELLANEOUS
            49  
 
  Section 11.1.Parties in Interest     49  
 
  Section 11.2.Assignment     49  
 
  Section 11.3.Notices     50  
 
  Section 11.4.Amendments and Waivers     51  
 
  Section 11.5.Exhibits and Disclosure Schedule     51  
 
  Section 11.6.Headings     52  
 
  Section 11.7.Construction     52  
 
  Section 11.8.No Other Representations or Warranties     52  
 
  Section 11.9.Entire Agreement     52  
 
  Section 11.10.Severability     52  
 
  Section 11.11.Expenses     53  
 
  Section 11.12.Governing Law     53  
 
  Section 11.13.Consent to Jurisdiction; Waiver of Jury Trial     53  
 
  Section 11.14.Equitable Remedies     53  
 
  Section 11.15.Counterparts     54  
SCHEDULES
                 
       
Disclosure Schedule
               
EXHIBITS
                 
       
A
  Escrow Agreement        
B
  Non-Compete Agreements        
C
  Consulting Agreement        

2

AGREEMENT AND PLAN OF MERGER

Agreement and Plan of Merger, dated as of July 9, 2007 (including the Schedules
and Exhibits hereto, this “Agreement”), is by and among Noven Pharmaceuticals,
Inc., a Delaware corporation (“Buyer”), Noven Acquisition, LLC, a Delaware
limited liability company and a wholly-owned subsidiary of Buyer (“Merger Sub”),
JDS Pharmaceuticals, LLC, a Delaware limited liability company (the “Company”),
and Satow Associates, LLC, solely in its capacity as Member Representative.
Buyer, Merger Sub, the Company, and solely in its capacity as such and to the
extent applicable, the Member Representative, are referred to collectively
herein as the “Parties” and each individually as a “Party.”

W I T N E S S E T H :

WHEREAS, upon the terms and subject to the conditions of this Agreement and in
accordance with the Delaware Limited Liability Company Act, 6 Del. C. § 18-101
et seq. (the “DLLCA”), Buyer, Merger Sub and the Company will enter into a
business combination transaction pursuant to which Merger Sub, an entity
organized for the sole purpose of entering into the transactions contemplated
hereby, will merge with and into the Company with the Company as the surviving
company and a wholly-owned subsidiary of Buyer (the “Merger”);

WHEREAS, the respective Boards of Directors, Managers or similar governing
bodies of Buyer, Merger Sub and the Company have approved this Agreement, the
Merger and the related transactions contemplated hereby, and have determined
that the Merger is advisable to, and in the best interests of, the respective
companies and their respective stockholders and members, as applicable, and have
recommended that their respective stockholders and members, as applicable,
consent to and approve this Agreement, the Merger and the related transactions
contemplated hereby upon the terms and subject to the conditions set forth
herein; and

WHEREAS, concurrently with the execution of this Agreement, the Member
Representative is delivering evidence to Buyer that (1) the Company’s Board of
Managers has adopted and approved this Agreement and the transactions
contemplated hereby and (2) the Majority AJAC Members, Majority Galen Members
and Majority JED Members (each as defined in the Amended and Restated Limited
Liability Company Agreement of the Company, dated October 31, 2005, as amended
(the “LLC Agreement”)) have each consented in writing to the Company entering
into this Agreement and the transactions contemplated hereby.

NOW, THEREFORE, in consideration of the mutual covenants and promises herein
made, and in consideration of the representations and warranties herein
contained, and for other good and valuable consideration the receipt and
adequacy of which are hereby acknowledged, the Parties hereto, intending to
become legally bound, hereby agree as follows:

ARTICLE I.

DEFINITIONS

Section 1.1. Certain Definitions. As used in this Agreement, the following terms
shall have the following meanings:

“Accounting Firm” has the meaning set forth in Section 3.7(b).

“Acquisition Transaction” has the meaning set forth in Section 6.11.

“Adjusted Merger Consideration” has the meaning set forth in Section 3.7(c).

“Action” means any action, suit or proceeding by or before any court or other
Governmental Authority.

“Affiliate” has the meaning set forth in Rule 12b-2 of the regulations
promulgated under the Securities Exchange Act.

“Agreement” has the meaning set forth in the preamble hereto.

“Allocable Closing Merger Consideration” has the meaning set forth in
Section 3.1.

“Allocation” has the meaning set forth in Section 6.14.

“Applicable Percentage” means with respect to any holder of Units or Phantom
Units, a ratio (expressed as a percentage) equal to the aggregate Allocable
Closing Merger Consideration to which such holder is entitled hereunder, divided
by the aggregate amount of Allocable Closing Merger Consideration paid to all
holders of Units (other than Preferred Units) and holders of Phantom Units
(other than Preferred Phantom Units).

“Assigned Hurdle Units” has the meaning set forth in Section 4.4.

“Balance Sheet Date” means December 31, 2006.

“Base Merger Consideration” means One Hundred and Twenty-Five Million Dollars
($125,000,000).

“Business” means the business of researching, developing (including through
acquisitions), manufacturing, marketing, selling and distributing
pharmaceuticals.

“Business Day” means any day other than Saturday, Sunday or any other day on
which banking institutions in New York are not open for the transaction of
normal banking business.

“Buyer” has the meaning set forth in the preamble to this Agreement.

“Buyer Indemnified Parties” has the meaning set forth in Section 8.2(a).

“Certificate” has the meaning set forth in Section 3.3(b).

“Claim Notice” has the meaning set forth in Section 8.3(a).

“Class M Hurdle Units” has the meaning set forth in the LLC Agreement.

“Class N Hurdle Units” has the meaning set forth in the LLC Agreement.

“Class O Hurdle Units” has the meaning set forth in the LLC Agreement.

“Class P Hurdle Units” has the meaning set forth in the LLC Agreement.

“Class Q Hurdle Units” has the meaning set forth in the LLC Agreement.

“Class R Hurdle Units” has the meaning set forth in the LLC Agreement.

“Closing” has the meaning set forth in Section 2.2.

“Closing Date” means the date the Closing occurs pursuant to Section 2.2.

“Closing Date Payment” means the Merger Consideration, minus, if the Estimated
Closing Date Working Capital is less than the Working Capital Target, the amount
by which the Estimated Closing Date Working Capital is less than the Working
Capital Target.

“Closing Date Working Capital” has the meaning set forth in Section 3.7(b).

“Code” means the Internal Revenue Code of 1986, as amended.

“Common Phantom Units” has the meaning set forth in the Management Incentive
Plan.

“Common Units” has the meaning set forth in the LLC Agreement.

“Commonly Controlled Entity” has the meaning set forth in Section 4.16(a).

“Company” has the meaning set forth in the recitals to this Agreement.

“Company Financial Statements” has the meaning set forth in Section 4.7.

“Company Group” means the Company and the Company’s Subsidiary.

“Company Group Employees” has the meaning set forth in Section 6.8(a).

“Company Plans” has the meaning set forth in Section 4.16(a).

“Company Transaction Expenses” means all fees and expenses incurred or that may
be incurred by the Company or any other member of the Company Group since
March 1, 2007 in connection with the preparation, negotiation and execution of
this Agreement and the consummation of the transactions contemplated hereby,
including (a) the fees and disbursements of outside counsel to the Company
incurred in connection with the transactions contemplated hereby; (b) the fees
and expenses of all other agents, advisors, consultants and experts employed by
the Company in connection with the transactions contemplated hereby (including
fees and expenses of Piper Jaffray & Co.); (c) all fees and expenses (including
premiums) incurred in connection with obtaining and maintaining directors’ and
officers’ liability insurance policies for Indemnified Officers under
Section 6.7; (d) the portion of Liability for Transfer Taxes and other expenses
incurred by the Company under Section 3.9; (e) all amounts paid under the
Company’s “Merger Related Discretionary Bonus Program” as approved by the
Company’s Compensation Committee on May 30, 2007 and (f) all Indebtedness and
other Liabilities (including that of any member of the Company Group) to the
Member Representative or any of its Affiliates (other than any member of the
Company Group).

“Confidentiality Agreement” means the Confidentiality Agreement, dated as of
February 5, 2007, between the Company and Buyer.

“Consents” means consents, approvals, exemptions, waivers, authorizations,
filings and registrations.

“Damages” means all Liabilities, losses, claims, damages, payments, costs and
expenses, in each case, on a pre-Tax basis (including costs and expenses of
Actions, amounts paid in connection with any assessments, judgments or
settlements relating thereto, interest and penalties recovered by a third party
with respect thereto and out-of pocket expenses and reasonable attorneys’ fees
and expenses reasonably incurred in defending against any such Actions or in
enforcing a Party’s rights hereunder).

“Disclosure Schedule” means the disclosure schedule delivered by the Company to
Buyer on the date hereof, as may be supplemented in accordance with the terms
hereof.

“Dispute Notice” has the meaning set forth in Section 8.3(e).

“DLLCA” has the meaning set forth in the recitals to this Agreement.

“Effective Time” has the meaning set forth in Section 2.3.

“Environmental Law” means any Law relating to pollution, the protection of the
environment or occupational safety and health.

“Equity Commitment Letter” means that letter agreement entered into by and among
AHP-JDS Acquisition Company, LLC; AIG Healthcare Partners, L.P., as guarantor
for AHP-JDS Acquisition Company, LLC; Galen Partners IV, L.P.; Galen Partners
International IV, L.P. and Philip M. Satow, dated as of August 24, 2005.

“ERISA” means the Employee Retirement Income Security Act of 1974.

“Escrow Agent” has the meaning set forth in Section 3.2.

“Escrow Agreement” has the meaning set forth in Section 3.2.

“Escrow Amount” has the meaning set forth in Section 3.2.

“Estimated Closing Date Working Capital” has the meaning set forth in Section
6.6(b).

“GAAP” means United States generally accepted accounting principles.

“Governmental Approvals” has the meaning set forth in Section 6.4(a).

“Governmental Authority” means any federal, state or local government, court of
competent jurisdiction, administrative agency or commission or other
governmental or regulatory authority or instrumentality.

“Hazardous Materials” means (a) any petroleum or petroleum products, radioactive
or medical materials or wastes, asbestos, and polychlorinated biphenyls and
(b) any other chemical, material, substance or waste that is prohibited or
regulated under any Environmental Law.

“HSR Act” means the Hart-Scott Rodino Antitrust Improvements Act of 1976.

“Hurdle Units” has the meaning set forth in Section 4.4.

“Indebtedness” of any Person means, without duplication, (a) all obligations of
such Person for borrowed money, (b) all obligations of such Person evidenced by
bonds, debentures, notes or similar instruments, (c) all obligations of such
Person under conditional sale or other title retention agreements relating to
property acquired by such Person, (d) all unconditional obligations of such
Person in respect of the deferred purchase price of property or services
(excluding current accounts payable incurred in the ordinary course of
business), (e) all Indebtedness of others secured by (or for which the holder of
such Indebtedness has an existing right, contingent or otherwise, to be secured
by) any Liens on property owned or acquired by such Person, whether or not the
Indebtedness secured thereby has been assumed and (f) all guarantees by such
Person of Indebtedness of others.

“Indemnified Officer” has the meaning set forth in Section 6.7.

“Indemnified Party” has the meaning set forth in Section 8.2(b).

“Indemnifying Party” has the meaning set forth in Section 8.3(a).

“Indemnity Notice” has the meaning set forth in Section 8.3(d).

“Injunction” has the meaning set forth in Section 6.4(a).

“Intellectual Property” means (a) all patents, patent applications and patent
disclosures, (b) all trademarks, service marks, trade dress, logos, trade names,
domain names and corporate names, and all applications, registrations and
renewals in connection therewith, (c) all copyrights and all applications,
registrations and renewals in connection therewith, and (d) all trade secrets
and confidential business information (including research and development,
know-how, compositions, manufacturing and production processes, technical
(including clinical) data, designs, specifications and business and marketing
plans and proposals).

“Knowledge” means, with respect to the Members or the Company, the actual
knowledge of any individual set forth in Schedule A1 without any implied duty to
investigate, and, with respect to Buyer, the actual knowledge of any individual
set forth in Schedule A2 without any implied duty to investigate.

“Laws” means all laws, statutes, constitutions, rules, regulations, judgments,
rulings, orders, decrees and Injunctions of or by any Governmental Authorities.

“Leased Real Property” has the meaning set forth in Section 4.10(b).

“Liability” means any liability (whether known or unknown, whether asserted or
unasserted, whether absolute or contingent, whether accrued or unaccrued,
whether liquidated or unliquidated, and whether due or to become due), including
any liability for Taxes.

“Lien” means any mortgage, pledge, lien, encumbrance, charge or other security
interest.

“LLC Agreement” has the meaning set forth in the recitals to this Agreement.

“Majority AJAC Members” has the meaning set forth in the LLC Agreement.

“Majority Galen Members” has the meaning set forth in the LLC Agreement.

“Majority JED Members” has the meaning set forth in the LLC Agreement.

“Management Incentive Plan” means the Management Unit Incentive Plan established
by the Company as of August 25, 2004, as provided for in the LLC Agreement.

“Material Adverse Effect” means (a) with respect to the Company Group, a
material adverse effect (1) on the business, assets, operations or financial
condition of the Company Group, taken as a whole or (2) on the ability of any
member of the Company Group to timely perform its obligations under, or to
consummate the transactions contemplated by, this Agreement, excluding, in the
case of clause (1), any such effect arising after the date of this Agreement
resulting from or arising out of or in connection with (i) general economic,
political, industry (including the health care and pharmaceutical industries),
or financial, securities or banking market events, occurrences, developments,
circumstances or conditions to the extent that such events, occurrences,
developments, circumstances or conditions do not, individually or in the
aggregate, disproportionately impact the Company Group or its Business,
(ii) changes in applicable Laws or regulatory policies generally affecting the
industries in which the Company Group operates and that do not, individually or
in the aggregate, disproportionately impact the Company Group or its Business,
(iii) changes in accounting standards, principles or interpretations, (iv) acts
of war, armed hostilities and terrorism, (v) actions taken or not taken at the
request of Buyer or Merger Sub or (iv) (other than with respect to Sections 4.3
and 4.6) changes resulting from the announcement or pendency of this Agreement
or the proposed consummation of the transactions contemplated hereby, and
(b) with respect to Buyer or Merger Sub, a material adverse effect on the
ability of Buyer or Merger Sub to timely perform its obligations under, or to
consummate the transactions contemplated by, this Agreement.

“Material Contracts” has the meaning set forth in Section 4.13(a).

“Member Allocable Expenses” has the meaning set forth in Section 3.2.

“Member Indemnified Parties” has the meaning set forth in Section 8.2(b).

“Member Representative” has the meaning set forth in Section 9.1.

“Members” means the members of the Company.

“Merger” has the meaning set forth in the recitals to this Agreement.

“Merger Consideration” means the Base Merger Consideration minus (without
duplication) (a) any fees and expenses recoverable by the Member Representative
pursuant to Article III or Article IX to the extent known (or, with respect to
any fees and expenses recoverable by the Member Representative in connection
with having to deliver the appropriate payments to the holders of Units or the
holders of Phantom Units pursuant to Section 3.3(a), reasonably estimated by the
Member Representative) prior to or at the Closing and communicated to Buyer, (b)
Company Transaction Expenses and (c) the Retained Liabilities.

“Merger Sub” has the meaning set forth in the preamble to this Agreement.

“Notice of Disagreement” has the meaning set forth in Section 3.7(b).

“Ordinary Income Assets” has the meaning set forth in Section 6.14(b).

“Other Parties” has the meaning set forth in Section 4.13(b).

“Participant” has the meaning set forth in Section 4.8.

“Parties” has the meaning set forth in the preamble to this Agreement.

“Permissible Objection” has the meaning set forth in Section 6.14(b).

“Permits” means written permits, licenses, franchises, registrations, variances,
approvals and waivers obtained from or required by any Governmental Authority.

“Permitted Liens” means any (a) mechanic’s, materialmen’s, laborer’s, workmen’s,
repairmen’s, carrier’s and similar Liens, including all statutory Liens, arising
or incurred in the ordinary course of business, (b) Liens for Taxes, assessments
and other governmental charges not yet due and payable or, if due, (i) not
delinquent or (ii) being contested in good faith through appropriate
proceedings, (c) purchase money Liens and Liens securing rental payments under
capital lease arrangements as set forth in Section A3 of the Disclosure
Schedule, (d) pledges or deposits under workers’ compensation legislation,
unemployment insurance Laws or similar Laws, (e) good faith deposits in
connection with bids, tenders, leases, contracts or other agreements, including
rent security deposits as set forth in Section A3 of the Disclosure Schedule,
(f) pledges or deposits to secure public or statutory obligations or appeal
bonds as set forth in Section A3 of the Disclosure Schedule, (g) Liens disclosed
in the Company Financial Statements, (h) other Liens not incurred in connection
with the borrowing of money which do not, individually or in the aggregate,
interfere with or impair, in any material respect, the present operation of the
Business, (i) in the case of property leased by the Company Group, easements,
covenants and other restrictions which do not, individually or in the aggregate,
materially impair the current use, occupancy or value of the property subject
thereto and (j) Liens arising under or created by the Transaction Documents.

“Person” means an individual, partnership, limited liability partnership,
corporation, limited liability company, association, joint stock company, trust,
estate, joint venture, unincorporated organization or Governmental Authority (or
any department, agency or political subdivision thereof).

“Phantom Units” has the meaning set forth in the Management Incentive Plan.

“Pre-Closing Tax Period” means any taxable period (or portion thereof) ending on
or before the Closing Date.

“Pre-Closing Tax Liability” means any liability of any member of the Company
Group for Taxes for any Pre-Closing Tax Period.

“Preferred Phantom Units” has the meaning set forth in the Management Incentive
Plan.

“Preferred Units” has the meaning set forth in the LLC Agreement.

“Products” means the pharmaceutical products listed on Section A4 of the
Disclosure Schedule.

“Proposed Allocation” has the meaning set forth in Section 6.14(a).

“Purchase Price Indebtedness” means, without duplication, (a) all obligations of
the Company Group for borrowed money, (b) all obligations of the Company Group
evidenced by bonds, debentures, notes or similar instruments, (c) all
obligations of others for borrowed money or evidenced by bonds, debentures,
notes or similar instruments that are secured by (or for which the holder of
such obligation has an existing right, contingent or otherwise, to be secured
by) any Liens on property owned or acquired by the Company Group or any member
thereof, whether or not the obligation secured thereby has been assumed and
(d) all guarantees by the Company Group of obligations of others for borrowed
money or evidenced by bonds, debentures, notes or similar instruments.

“Reimbursement” has the meaning set forth in Section 8.5(a).

“Release” means any release, discharge, disposal, spill, injection, leak,
leaching, escape, emptying, seeping, migration or emission into or through the
environment or within any building, structure, facility or fixture.

“Remedies Exception” means (a) applicable bankruptcy, insolvency,
reorganization, moratorium and other Laws of general application, heretofore or
hereafter enacted or in effect, affecting the rights and remedies of creditors
generally, and (b) the exercise of judicial or administrative discretion in
accordance with general equitable principles, particularly as to the
availability of the remedy of specific performance or other injunctive relief.

“Restricted Common Units” has the meaning set forth in the LLC Agreement.

“Retained Liabilities” means, without duplication, all amounts owed by the
Company Group: (a) pursuant to that certain promissory note of the Company in
favor of Solvay Pharmaceuticals, Inc., dated August 6, 2004, as amended; (b) due
to Synthon under section 3.1(b) (but not including sections 3.1(b)(i) and
3.1(b)(ii)) of that certain Asset Purchase Agreement by and between Synthon and
the Company, dated October 17, 2005; (c) otherwise qualifying (including the
current portion thereof) as “long-term obligations” of the Company Group in the
Company Financial Statements (but excluding the “Additional Fee Aggregate
Minimum” under section 3.4(d) of that certain Asset Purchase Agreement by and
between Synthon and the Company, dated October 17, 2005); and (d) as Purchase
Price Indebtedness. For the avoidance of doubt, Retained Liabilities shall not
include contingent milestone payments due pursuant to (1) sections 2.2(b),
2.2(c), 2.2(d) and 2.2(e) of that certain Development, License and Supply
Agreement by and between Banner Pharmacaps Inc. and the Company, dated April 26,
2007; (2) sections 3.1(b)(i), 3.1(b)(ii), 3.1(c) and 3.1(d) of that certain
Asset Purchase Agreement by and between Synthon and the Company, dated
October 17, 2005; (3) paragraph 1 of that certain Side Letter, dated August 22,
2006, to the Supply Agreement between Valpharma International S.p.A. and the
Company, dated April 29, 2004; and (4) sections 4.1(b), 4.1(c), 4.1(d) and
4.1(e) of that certain Asset Purchase Agreement by and between Istituto
Farmacoterapico Italiano S.p.A., Unihart Corporation and the Company, dated
March 19, 2004.

“Right” means any option, warrant, convertible or exchangeable security or other
right, however denominated, to subscribe for, purchase or otherwise acquire any
equity interest or other security of any class, with or without payment of
additional consideration in cash or property, either immediately or upon the
occurrence of a specified date or a specified event or the satisfaction or
happening of any other condition or contingency.

“Securities Act” means the Securities Act of 1933.

“Securities Exchange Act” means the Securities Exchange Act of 1934.

“Statement” has the meaning set forth in Section 3.7(b).

“Subsidiary” when used with respect to any Person, means any other Person of
which (a) in the case of a corporation, at least (i) a majority of the equity
and (ii) a majority of the voting interests are owned or controlled, directly or
indirectly, by such first Person, by any one or more of such first Person’s
Subsidiaries, or by such first Person and one or more of such first Person’s
Subsidiaries or (b) in the case of any Person other than a corporation, such
first Person, one or more of such first Person’s Subsidiaries, or such first
Person and one or more of such first Person’s Subsidiaries (i) owns a majority
of the equity interests thereof and (ii) has the power to elect or direct the
election of a majority of the members of the governing body thereof.

“Survival Date” has the meaning set forth in Section 8.1(a)(i).

“Surviving Company” has the meaning set forth in Section 2.1.

“Surviving Company Group” has the meaning set forth in Section 6.7.

“Synthon” means Synthon Pharmaceuticals Inc.

“Tax” means any federal, state, local or foreign tax, duty, fee, levy or other
assessment, including income, gross receipts, license, payroll, employment,
excise, severance, stamp, occupation, premium, windfall profits, environmental,
customs duties, capital stock, franchise, profits, withholding, social security
(or similar), unemployment, disability, real property, personal property, sales,
use, transfer, registration, value added, alternative or add-on minimum,
estimated or other tax, imposed by any Governmental Authority, and including any
interest, penalties or additions thereto.

“Tax Return” means any return, declaration, report, claim for refund or
information return or statement relating to Taxes, including any schedule or
attachment thereto, and including any amendment thereof, required to be filed
with any Governmental Authority.

“Third-Party Claim” has the meaning set forth in Section 8.3(a).

“Transaction Documents” means this Agreement and all other documents delivered
or required to be delivered at Closing by any Party pursuant to this Agreement.

“Transfer Taxes” means all transfer Taxes (excluding, for the avoidance of
doubt, Taxes measured by net income), including sales, property, real estate
transfer, use, excise, stock, stamp, documentary, filing, recording, permit,
license, authorization and similar Taxes, filing fees and similar charges.

“Units” has the meaning set forth in the LLC Agreement and, for the avoidance of
doubt, also means (to the extent not already included in the definition provided
in the LLC Agreement and without duplication) membership interests in the
Company, including any securities issued in respect of or in exchange for
membership interests in the Company.

“Waiving Party” has the meaning set forth in Section 8.1(b).

“Working Capital” means, without duplication, (a) the consolidated current
assets of the Company Group (excluding any restricted cash) minus (b) the
consolidated current liabilities of the Company Group (excluding any Retained
Liabilities or Company Transaction Expenses), in each case immediately prior to
the Effective Time and calculated in the same way, using the same methods, as
the corresponding line items on the Company Financial Statements at the Balance
Sheet Date and in accordance with GAAP, as consistently applied by the Company.

“Working Capital Target” means negative Seven Million Dollars (-$7,000,000).

Section 1.2. Terms Generally. The definitions in Section 1.1 shall apply equally
to both the singular and plural forms of the terms defined. Whenever the context
may require, any pronoun shall include the corresponding masculine, feminine and
neuter forms. The words “include”, “includes” and “including” shall be deemed to
be followed by the phrase “without limitation.” The words “herein”, “hereof” and
“hereunder” and words of similar import refer to this Agreement (including the
Exhibits to this Agreement and the Disclosure Schedule) in its entirety and not
to any part hereof unless the context shall otherwise require. All references
herein to Articles, Sections, Exhibits and the Disclosure Schedule shall be
deemed references to Articles and Sections of, and Exhibits and the Disclosure
Schedule to, this Agreement unless the context shall otherwise require. Unless
the context shall otherwise require, any references to any agreement or other
instrument or statute or regulation are to it as amended and supplemented from
time to time (and, in the case of a statute or regulation, to any successor
provisions). Any reference to any federal, state, local or foreign statute or
Law shall be deemed also to refer to all rules and regulations promulgated
thereunder, unless the context requires otherwise. Any reference in this
Agreement to a “day” or a number of “days” (without explicit reference to
“Business Days”) shall be interpreted as a reference to a calendar day or number
of calendar days. If any action is to be taken or given on or by a particular
calendar day, and such calendar day is not a Business Day, then such action may
be deferred until the next Business Day. Any reference to a Person includes such
Person’s successors and permitted assigns.

ARTICLE II.

MERGER

Section 2.1. The Merger. Upon the terms and subject to the conditions hereof, at
the Effective Time, Merger Sub shall be merged with and into the Company and the
separate existence of Merger Sub shall thereupon cease, and the Company shall
continue as the surviving company in the Merger (the “Surviving Company”) in
accordance with the DLLCA.

Section 2.2. Closing. Unless this Agreement shall have been terminated pursuant
to Article X and subject to the satisfaction or, when permissible, waiver of the
conditions set forth in Article VII, the closing of the transactions
contemplated by this Agreement (the “Closing”) shall take place (a) at the
offices of Latham & Watkins LLP, 885 Third Avenue, New York, New York 10022,
commencing at 10:00 a.m. local time on the day which is two (2) Business Days
after the date on which the last of the conditions set forth in Article VII
(other than any such conditions which by their terms are not capable of being
satisfied until the Closing Date) is satisfied or, when permissible, waived, or
(b) on such other date and/or at such other time and/or place as the Parties may
mutually determine (the “Closing Date”).

Section 2.3. Effective Time of the Merger. The Merger shall become effective
upon the filing of the certificate of merger with the Secretary of State of the
State of Delaware in accordance with the provisions of the DLLCA, or at such
other time as Merger Sub and the Company shall agree should be specified in the
certificate of merger, which filing shall be made as soon as practicable on the
Closing Date. When used in this Agreement, the term “Effective Time” shall mean
the time at which such certificate is accepted for filing by the Secretary of
State of the State of Delaware or such other time as otherwise specified in the
certificate of merger.

Section 2.4. Effect of Merger. The Merger shall, from and after the Effective
Time, have all the effects provided herein, in the certificate of merger and in
the applicable provisions of the DLLCA.

Section 2.5. Further Actions. The Parties hereto shall execute and deliver such
certificates and other documents and take such other actions as may be necessary
or appropriate in order to effect the Merger, including, but not limited to,
making filings, recordings or publications required under the DLLCA. If at any
time after the Effective Time any further action is necessary to vest in the
Surviving Company the title to all property or rights of Merger Sub or the
Company, the authorized officers and managers of the Surviving Company are fully
authorized in the name of Merger Sub or the Company, as the case may be, to
take, and shall take, any and all such lawful action.

Section 2.6. Organizational Documents. The organizational documents of Merger
Sub as in effect immediately prior to the Effective Time (and containing the
provisions required by Section 6.7) shall be the organizational documents of the
Surviving Company after the Effective Time, until thereafter changed or amended
as provided therein or by applicable Law (subject to Section 6.7).

Section 2.7. Officers. The officers of the Company immediately prior to the
Effective Time shall be the officers of the Surviving Company, each to hold
office in accordance with the organizational documents of the Surviving Company
until the earlier of their resignation or removal or until their respective
successors are duly elected and qualified, in any case in the manner provided in
the organizational documents of the Surviving Company and in accordance with
applicable Law. The managers of Merger Sub immediately prior to the Effective
Time shall become the managers of the Surviving Company at the Effective Time.

ARTICLE III.

CONVERSION OF UNITS

Section 3.1. Merger Consideration. As of the Effective Time, by virtue of the
Merger and without any further action on the part of any holder of Units or
Phantom Units or any member of Merger Sub, (a) each Unit or Phantom Unit held by
Buyer, Merger Sub, or by any member of the Company Group in treasury, not issued
or outstanding or otherwise, shall be canceled and retired and shall cease to
exist, and no consideration shall be delivered or receivable in exchange
therefore, (b) each other Unit or Phantom Unit issued and outstanding
immediately prior to the Effective Time shall be converted into and represent
the right, in full satisfaction of the rights of the holder thereof, to receive
(i) an amount in cash equal to the amount that would be receivable in respect of
such Unit or Phantom Unit pursuant to, and in accordance with the rights and
obligations set forth in, the LLC Agreement and the Management Incentive Plan in
a complete liquidation of the Company where the liquidation proceeds are equal
to the Adjusted Merger Consideration less the Escrow Amount (the amount
receivable in respect of a particular Unit or Phantom Unit pursuant to this
clause (i), that Unit or Phantom Unit’s “Allocable Closing Merger
Consideration”), and (ii) to the extent applicable, a portion of the balance of
the Escrow Amount in accordance with Section 8.10, in each case after taking
into account the cancellation of Units and Phantom Units pursuant to clause
(a) of this Section 3.1 and determined in accordance with the methodologies used
in Section 3.1 of the Disclosure Schedule (which, by way of example, sets forth
a calculation of the Allocable Closing Merger Consideration, including the
amount payable to holders of the Preferred Phantom Units, which derive their
value pursuant to the Management Incentive Plan based on the value of the
Adjusted Merger Consideration, that would be payable if the Effective Time
occurred on August 15, 2007 and the Adjusted Merger Consideration was equal to
the Base Merger Consideration) and (c) each issued and outstanding limited
liability company interest of Merger Sub shall be converted into and become one
fully paid and nonassessable limited liability company interest of the Surviving
Company.

Section 3.2. Escrow Amount. At the Effective Time, a portion of the Merger
Consideration in an amount equal to $10,000,000 (the “Escrow Amount”) shall be
paid by Buyer to Wells Fargo Bank, N.A., as escrow agent of the Parties (the
“Escrow Agent”), to be held in escrow in accordance with the terms of an Escrow
Agreement in the form attached hereto as Exhibit A (the “Escrow Agreement”). The
Escrow Amount shall be held, invested and distributed in accordance with the
terms of the Escrow Agreement and in accordance with this Section 3.2 and
Article VIII hereof. Following the Closing and in accordance with Section 8.10,
the Member Representative shall be entitled to direct the Escrow Agent, at any
time and from time to time, to pay the following fees and expenses that may be
incurred by the Member Representative on behalf of the holders of Units and the
holders of Phantom Units out of the Escrow Amount: (a) the reasonable fees and
disbursements of special outside counsel to the Member Representative incurred
in connection with any indemnification claims for Damages pursuant to
Article VIII, (b) the reasonable fees and expenses of any other agents,
advisors, consultants and experts employed by the Member Representative incurred
in connection with any indemnification claims for Damages pursuant to
Article VIII, (c) the reasonable fees and disbursements of the Member
Representative’s independent auditors incurred in connection with their review
of the Statement and certification of any Notice of Disagreement under Section
3.7(b) and (d) other reasonable out-of-pocket expenses of the Member
Representative incurred in connection with any indemnification claims for
Damages pursuant to Article VIII or the procedures set forth in Section 3.7(b)
(collectively, the “Member Allocable Expenses”). For the avoidance of doubt, all
unpaid Member Allocable Expenses that have been submitted to the Escrow Agent by
the Member Representative for payment and that are permitted hereby shall be
paid out of the Escrow Amount by the Escrow Agent prior to any payment being
made by the Escrow Agent of any portion of the Escrow Amount to any Buyer
Indemnified Party or to any holder of Units (other than Preferred Units) or
Phantom Units (other than Preferred Phantom Units) pursuant to Section 8.10. In
no event will Buyer or the Member Representative be responsible for payment of
Member Allocable Expenses in excess of the Escrow Amount.

Section 3.3. Payment.

(a) At the Effective Time, Buyer shall pay to the Member Representative, for the
benefit of the holders of Units and the holders of Phantom Units, an amount in
cash equal to the Closing Date Payment less the Escrow Amount. Other than as set
forth in Section 3.3(d), Buyer shall have fully discharged its obligation to pay
the Closing Date Payment upon delivery of payment to the Member Representative
in accordance with this Section 3.3(a), and the Member Representative shall be
solely responsible for the delivery of the appropriate payments to the holders
of Units and the holders of Phantom Units pursuant to the terms of this
Agreement.

(b) Promptly after the Effective Time, the Member Representative shall send a
notice and a letter of transmittal in a form reasonably satisfactory to Buyer
and the Company to each holder of certificates formerly evidencing Units or
Phantom Units (collectively, the “Certificates”) and any holders of Units or
Phantom Units immediately prior to the Effective Time not evidenced by
Certificates, advising of the effectiveness of the Merger and the procedure for
surrendering to the Member Representative such Certificates, Units and Phantom
Units for exchange into the right to receive the applicable Allocable Closing
Merger Consideration and, to the extent applicable, a portion of the balance of
the Escrow Amount in accordance with Section 8.10, and that delivery shall be
effected, and risk of loss and title shall pass, only upon proper delivery to
the Member Representative of such Certificates, Units and Phantom Units and a
duly executed letter of transmittal and any other required documents or evidence
of transfer. Each holder of Certificates or Units or Phantom Units not evidenced
by Certificates, upon surrender thereof to the Member Representative together
with such letter of transmittal (duly executed) and any other required documents
or evidence of transfer, shall be entitled to receive in exchange therefore, and
in full satisfaction of any rights thereunder, the right to receive the
applicable Allocable Closing Merger Consideration and, to the extent applicable,
a portion of the balance of the Escrow Amount in accordance with Section 8.10.
Upon such surrender but subject to the adjustment provisions of Section 3.7, the
Member Representative shall promptly deliver the applicable Allocable Closing
Merger Consideration (less all applicable withholding and employment taxes) in
accordance with the instructions set forth in the related letter of transmittal,
and the Certificates, Units and Phantom Units so surrendered shall promptly be
canceled. On and after the Effective Time, the Certificates, Units and Phantom
Units shall be deemed for all purposes to evidence only the right to receive the
applicable Allocable Closing Merger Consideration and, to the extent applicable,
a portion of the balance of the Escrow Amount in accordance with Section 8.10.
No interest shall accrue or be paid on any cash payable upon the surrender of
the Certificates, Units and Phantom Units.

(c) If any portion of the consideration due pursuant to Section 3.3(b) is to be
delivered to a Person other than the Person in whose name the Certificates,
Units or Phantom Units surrendered in exchange therefor are registered, it shall
be a condition to the payment of such consideration that the Certificates, Units
and Phantom Units so surrendered shall be properly endorsed or accompanied by
appropriate powers and otherwise in proper form for transfer, that such transfer
otherwise be proper and that the Person requesting such transfer pay to the
Member Representative any transfer or other Taxes payable by reason of the
foregoing or establish to the satisfaction of the Member Representative that
such Taxes have been paid or are not required to be paid.

(d) Unless required otherwise by applicable Law, any amount held by the Member
Representative that remains undistributed to holders of the Certificates, Units
and Phantom Units 180 days after the Effective Time shall be delivered to the
Party who provided such funds to the Member Representative and any Certificate,
Unit or Phantom Unit holder who has not theretofore complied with the provisions
of this Article III shall thereafter look only to the Surviving Company for
payment of the Allocable Closing Merger Consideration to which such Person is
entitled pursuant to this Article III. Neither Buyer nor the Member
Representative shall be liable to any such Certificate, Unit or Phantom Unit
holder for any amounts delivered to a public official pursuant to any applicable
abandoned property, escheat or similar Law.

Section 3.4. No Further Rights. From and after the Effective Time, holders of
Certificates, Units and Phantom Units theretofore evidencing membership
interests in the Company shall cease to have any rights as members of the
Company, the Surviving Company, any member of the Company Group or the Surviving
Company Group or otherwise. All consideration paid pursuant to Section 3.3 upon
the surrender of Certificates, Units and Phantom Units in accordance with the
terms hereof shall be deemed to have been paid in full satisfaction of all
rights pertaining to the Units and Phantom Units (both in Certificate and
non-Certificate form).

Section 3.5. Closing of the Company’s Transfer Books. At the Effective Time, the
transfer books of the Company shall be closed and no transfer of Units shall be
made thereafter. If after the Effective Time Certificates, Units or Phantom
Units are presented to Buyer or the Surviving Company, they shall be canceled
and exchanged as provided in this Article III.

Section 3.6. Closing Deliveries.

(a) At the Closing, the Company shall deliver or cause to be delivered to Buyer
the following:

(i) resignations of the managers or directors set forth in Section 3.6 of the
Disclosure Schedule, from his or her position as manager or director, as
applicable, of the applicable member of the Company Group, effective as of the
Closing;

(ii) (A) non-compete agreements, in the form attached hereto as Exhibit B,
executed by each of Philip M. Satow and Michael S. Satow, and (B) a consulting
agreement, in the form attached hereto as Exhibit C, executed by Philip M.
Satow;

(iii) the certificates referred to in Sections 7.3(a) and 7.3(b); and

(iv) all other documents required to be delivered by the Company or the Member
Representative to Buyer at the Closing pursuant to this Agreement.

(b) At the Closing, Buyer shall deliver or cause to be delivered the following:

(i) the Closing Date Payment less the Escrow Amount in immediately available
funds to the Member Representative as provided in Section 3.3;

(ii) the Escrow Amount in immediately available funds to the Escrow Agent as
provided in Section 3.2;

(iii) the Company Transaction Expenses in immediately available funds to the
Company for payment in full to the Persons to whom any portion of such Company
Transaction Expenses is owed or, at the request of the Company, directly to such
Persons on behalf of the Company;

(iv) an amount equal to the Retained Liabilities in immediately available funds
to the Company for payment in full to the Persons to whom any portion of the
Retained Liabilities is owed or, at the request of the Company, directly to such
Persons on behalf of the Company;

(v) the certificates referred to in Sections 7.2(a) and 7.2(b); and

(vi) all other documents required to be delivered by Buyer and Merger Sub to the
Company and Member Representative at the Closing pursuant to this Agreement.

Section 3.7. Adjustment to Merger Consideration. (a) Immediately prior to the
Closing, the Company and its Subsidiaries shall bring current (in accordance
with then-existing contract and invoice payment terms) all accounts payable,
accrued expenses and other liabilities of the Company Group to reflect the
amounts thereof immediately prior to the Closing.

(b) Within 180 days after the Closing Date, the Surviving Company shall prepare
and deliver to the Member Representative a statement (the “Statement”),
certified by an officer of the Surviving Company, setting forth Working Capital
as of the Effective Time (the “Closing Date Working Capital”). During the 30-day
period following the Member Representative’s receipt of the Statement, the
Member Representative shall be permitted to review the working papers relating
to the Statement, and the Statement shall become final and binding upon the
Parties hereto on the 30th day following delivery thereof to the Member
Representative unless the Member Representative gives to Buyer written notice of
its disagreement (a “Notice of Disagreement”) with the Statement prior to such
date. Any Notice of Disagreement shall (i) specify in reasonable detail the
nature of any disagreement so asserted, (ii) only include disagreements based on
mathematical errors or based on Closing Date Working Capital not being
calculated in accordance with the terms of this Agreement, (iii) be accompanied
by a certificate of the Member Representative that it has complied with this
Section 3.7 and (iv) be accompanied by a certificate of the Member
Representative’s independent auditors confirming and concurring with each of the
positions taken by the Member Representative in the Notice of Disagreement. If a
Notice of Disagreement is received by Buyer in a timely manner, then the
Statement (as revised, if necessary, in accordance with this sentence) shall
become final and binding upon the Parties hereto on the earlier of (A) the date
Buyer and the Member Representative resolve in writing all differences they have
with respect to the matters specified in the Notice of Disagreement and (B) the
date all disputed matters are finally resolved in writing by the Accounting
Firm. During the 30-day period following the delivery of a Notice of
Disagreement, Buyer and the Member Representative shall seek in good faith to
resolve in writing all differences that they may have with respect to the
matters specified in the Notice of Disagreement. At the end of such 30-day
period, if Buyer and the Member Representative have not resolved in writing all
differences that they have with respect to the matters specified in the Notice
of Disagreement, Buyer and the Member Representative shall submit to an
independent accounting firm (the “Accounting Firm”) for arbitration any and all
matters that remain in dispute and were properly included in the Notice of
Disagreement. The Accounting Firm shall be a nationally recognized independent
public accounting firm agreed upon by Buyer and the Member Representative in
writing. Judgment may be entered upon the determination of the Accounting Firm
in any court having jurisdiction over the party against which such determination
is to be enforced. The cost of any arbitration (including the fees and expenses
of the Accounting Firm and reasonable attorney fees and expenses of the parties)
pursuant to this Section 3.7 shall be borne by Buyer and the Member
Representative in inverse proportion as they may prevail on matters resolved by
the Accounting Firm, which proportionate allocations shall also be determined by
the Accounting Firm at the time the determination of the Accounting Firm is
rendered on the merits of the matters submitted. The fees and disbursements of
the Member Representative’s independent auditors incurred in connection with
their review of the Statement and certification of any Notice of Disagreement
shall be borne by the Member Representative, and the fees and disbursements of
Buyer’s independent auditors incurred in connection with their review of the
Statement and any Notice of Disagreement shall be borne by Buyer. Any
determinations by the Accounting Firm, and any work or analyses performed by the
Accounting Firm, in connection with its arbitration of any dispute under this
Section 3.7 shall not be admissible in evidence in any suit, action or
proceeding between the Parties hereto other than to the extent necessary to
enforce payment obligations under this Section 3.7(b).

(c) The Merger Consideration shall be decreased by the amount by which Closing
Date Working Capital is less than the Working Capital Target (the Merger
Consideration as so decreased, the “Adjusted Merger Consideration”). If the
Adjusted Merger Consideration is greater than the Closing Date Payment, Buyer
shall, within ten business days after the Statement becomes final and binding on
the Parties hereto, make payment to the Member Representative, for the benefit
of the holders of Units and the holders of Phantom Units, by wire transfer in
immediately available funds in the amount of such excess. If Adjusted Merger
Consideration is less than the Closing Date Payment, Buyer shall be entitled to
an indemnity payment in the amount of such deficiency in accordance with
Section 8.2(a)(i)(E). Any payment under this Section 3.7(c) shall be made
together with interest thereon at a rate equal to the rate of interest from time
to time announced publicly by Citibank, N.A., as its prime rate, calculated on
the basis of the actual number of days elapsed divided by 365, from the Closing
Date to the date of such payment.

Section 3.8. Satisfaction of Conditions. All conditions to the obligations of
the Company, Buyer and Merger Sub to proceed with the Closing under this
Agreement shall be deemed to have been fully and completely satisfied or waived
for all purposes upon the Closing.

Section 3.9. Transfer Taxes. Liability for Transfer Taxes incurred in connection
with this Agreement, the transactions contemplated by this Agreement or the
documents giving effect to such transactions shall be shared, 50% by Buyer, on
the one hand, and 50% by the Company, on the other hand.

ARTICLE IV.

REPRESENTATIONS AND WARRANTIES REGARDING THE COMPANY GROUP

The Company represents and warrants to Buyer, except as set forth in the
Disclosure Schedule (and subject to Section 11.5), as follows:

Section 4.1. Organization of the Company and the Company Group. The Company is a
limited liability company duly formed, validly existing and in good standing
under the laws of Delaware, and the Company has all requisite limited liability
power and authority to carry on its business as it is currently conducted and to
own, lease and operate its properties where such properties are now owned,
leased or operated. Each other member of the Company Group (a) is duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its organization and (b) has all requisite organizational power
and authority to carry on its respective business as it is currently conducted
and to own, lease and operate its properties where such properties are now
owned, leased or operated, except in all cases where any failures of the
representations in this sentence to be true would not and would not reasonably
be expected to, individually or in the aggregate, have a Material Adverse Effect
on the Company Group. Each member of the Company Group is duly qualified or
licensed to do business and is in good standing in each jurisdiction in which
the property owned, leased or operated by it or the nature of the business
conducted by it makes such qualification or license necessary, except where the
failure to be so duly qualified or licensed or in good standing would not and
would not reasonably be expected to, individually or in the aggregate, have a
Material Adverse Effect on the Company Group.

Section 4.2. Authorization. The Company has all requisite limited liability
company power and authority to execute and deliver this Agreement and the other
Transaction Documents to which it is or will be party and to perform its
obligations hereby and thereby. The execution, delivery and performance by the
Company of this Agreement and the other Transaction Documents to which the
Company is or will be a Party and the consummation of the transactions
contemplated hereby and thereby have been, or will be at the time of execution,
duly authorized by the Members, pursuant to the LLC Agreement and the DLLCA. No
other limited liability company or member proceedings on the part of the Company
are necessary to authorize this Agreement, such Transaction Documents or the
consummation of the transactions contemplated hereby or thereby. This Agreement
has been duly executed and delivered by the Company and (assuming this Agreement
constitutes a legal, valid and binding obligation of Buyer and Merger Sub)
constitutes a legal, valid and binding obligation of the Company, enforceable
against the Company in accordance with its terms, subject to the Remedies
Exception.

Section 4.3. Noncontravention. Neither the execution and delivery of this
Agreement by the Company, nor the consummation by the Company of the
transactions contemplated hereby will (a) conflict with the LLC Agreement,
(b) subject to the Consents described in Section 4.6(c) of the Disclosure
Schedule, violate or result in a breach of any Material Contract, or (c) subject
to the Consents of Governmental Authorities described in Section 4.6(e), violate
any Law to which any member of the Company Group is subject, except, in the case
of clauses (b) and (c), for such violations or breaches which would not and
would not reasonably be expected to, individually or in the aggregate, have a
Material Adverse Effect on the Company Group.

Section 4.4. Capitalization. The issued membership interests in the Company
consist of: (a) 57,688,909 Common Units, of which (i) 50,000,000 are straight
Common Units, (ii) 6,468,076 are Restricted Common Units and (iii) 1,220,833 are
Common Phantom Units; (b) 36,462,810 Preferred Units, of which 750,000 are
Preferred Phantom Units; (c) 3,333,333 Class M Hurdle Units; (d) 3,809,524
Class N Hurdle Units; (e) 4,395,604 Class O Hurdle Units; (f) 5,128,205 Class P
Hurdle Units; (g) 6,060,606 Class Q Hurdle Units; and (h) 7,272,727 Class R
Hurdle Units (subsections (c), (d), (e), (f), (g) and (h) of this Section 4.4
together, the “Hurdle Units”). Section 4.4 of the Disclosure Schedule sets forth
a true, correct and complete list of (A) all the outstanding Common Units
(including the straight Common Units, Restricted Common Units and Common Phantom
Units), including, if applicable, the grant dates, expiration dates, exercise
prices or exercise equivalent prices and vesting schedules thereof and the names
of the holders thereof, (B) all of the outstanding Preferred Units (including
Preferred Phantom Units), including, if applicable, the grant dates, expiration
dates, exercise prices or exercise equivalent prices and vesting schedules
thereof and the names of the holders thereof and (C) all of the outstanding
Hurdle Units (including Hurdle Units assigned or granted in connection with
employment with or service to the Company or its affiliates (the “Assigned
Hurdle Units”)), including the grant dates, assignment dates (if applicable),
expiration dates and vesting schedules thereof and the names of the holders
thereof. All outstanding Restricted Common Units, Phantom Common Units,
Preferred Phantom Units and Assigned Hurdle Units are evidenced by award
agreements, in each case substantially in the forms provided to Buyer prior to
the date of this Agreement, and no award agreement contains terms that are
materially inconsistent with such forms. Nothing in any award agreement for
outstanding Restricted Common Units, Phantom Common Units, Preferred Phantom
Units or Assigned Hurdle Units prevents the cancellation of such Restricted
Common Units, Phantom Common Units, Preferred Phantom Units or Assigned Hurdle
Units upon, and in exchange for, payments to the holders thereof in accordance
with the terms of this Agreement, and nothing in any such award agreement
entitles holders of Restricted Common Units, Phantom Common Units, Preferred
Phantom Units or Assigned Hurdle Units, upon the cancellation of such Restricted
Common Units, Phantom Common Units, Preferred Phantom Units or Assigned Hurdle
Units, to any payment other than payments to such holders in accordance with the
terms of this Agreement. All of the Units have been duly authorized and validly
issued. Except as set forth in Section 4.4 of the Disclosure Schedule, no holder
of Units or Phantom Units are party to any convertible securities, calls,
preemptive rights, options, warrants, purchase rights or other contracts,
agreements or commitments (other than this Agreement) that would require any
holder of Units or Phantom Units to sell, transfer or otherwise dispose of the
Units or Phantom Units. No holder of Units or Phantom Units is party to any
voting trust, proxy or other agreement or understanding with respect to the
voting of the Units or Phantom Units. Except as set forth in Section 4.4 of the
Disclosure Schedule, there are not any options, warrants, rights, convertible or
exchangeable securities or interests, “phantom” equity rights, unit appreciation
rights, performance units, commitments, agreements, arrangements or undertakings
of any kind to which the Company or any of its Subsidiaries is a party or by
which any of them is bound (i) obligating the Company or any of its Subsidiaries
to issue, deliver or sell, or cause to be issued, delivered or sold, additional
equity interests in, or any security or interest convertible or exercisable for
or exchangeable into any equity interest in, the Company or any of its
Subsidiaries, (ii) obligating the Company or any of its Subsidiaries to issue,
grant, extend or enter into any such option, warrant, call, right, security,
interest, commitment, agreement, arrangement or undertaking or (iii) that give
any Person the right to receive any economic benefit or right similar to or
derived from the economic benefits and rights occurring to holders of Units or
Phantom Units. As of the date of this Agreement, there are not any outstanding
contractual obligations of the Company or any of its Subsidiaries to repurchase,
redeem or otherwise acquire any equity of the Company or any of its
Subsidiaries. Except as set forth above in this Section 4.4, (I) no equity
interests or voting securities of the Company were issued, reserved for issuance
or outstanding and (II) there are no Common Units (including straight Common
Units, Restricted Common Units and Common Phantom Units), Preferred Units
(including Preferred Phantom Units) or Hurdle Units (including Assigned Hurdle
Units) subject to vesting or restrictions on transfer imposed by the Company,
“phantom” equity rights, unit appreciation rights, performance units, rights to
receive Common Units (including straight Common Units, Restricted Common Units
and Common Phantom Units), Preferred Units (including Preferred Phantom Units)
or Hurdle Units (including Assigned Hurdle Units) on a deferred basis or other
rights that are linked to the value of the Company’s equity interests or voting
securities.

Section 4.5. Subsidiaries of the Company. Section 4.5 of the Disclosure Schedule
sets forth for each of the Company’s Subsidiaries (a) its name and jurisdiction
of organization, (b) its form of organization and (c) the capital stock,
membership interests or units held by the Company, directly or indirectly, in
such Subsidiary. The Company is the sole direct or indirect beneficial and
record owner of the outstanding shares of capital stock or other interests or
units in the Company’s Subsidiaries, free and clear of all Liens, except (i) as
may be set forth in the certificate of formation, limited liability company
agreement, limited partnership agreement, certificate of incorporation or
bylaws, or similar governing documents of such Subsidiary, (ii) for any
restrictions on sales of securities under applicable securities Laws, (iii) for
Permitted Liens and (iv) as set forth in Section 4.5 of the Disclosure Schedule.

Section 4.6. Consents, Government Authorizations. Except for (a) compliance with
the HSR Act and the regulations thereunder and any other antitrust or merger
notification or control Laws, (b) compliance with any applicable requirements of
the Securities Act and any other applicable securities Laws, (c) Consents set
forth in Section 4.6(c) of the Disclosure Schedule, (d) Consents that, if not
obtained or made, would not and would not reasonably be expected to,
individually or in the aggregate, have a Material Adverse Effect on the Company
Group and (e) those Consents of Governmental Authorities set forth in
Section 4.6(e) of the Disclosure Schedule, no Consent is required to be obtained
or made by the Company Group in connection with the execution and delivery of
this Agreement or the consummation of the transactions contemplated hereby,
other than any such requirement that is applicable as a result of the specific
legal or regulatory status of Buyer, Merger Sub or any of their respective
Affiliates or as a result of any other facts that specifically relate to the
business or activities in which Buyer, Merger Sub or any of their respective
Affiliates is or proposes to be engaged, other than the Business.

Section 4.7. Financial Statements. Set forth in Section 4.7 of the Disclosure
Schedule are (a) the audited consolidated balance sheets of the Company Group as
of December 31, 2005 and 2006, (b) the related audited consolidated statements
of operations, Members’ deficit and cash flows of the Company Group for the
years ended on December 31, 2005 and 2006 and (c) the unaudited consolidated
balance sheet of the Company Group as of March 31, 2007 and the related
statements of operations, Members’ deficit and cash flows for the period ended
on March 31, 2007 (clauses (a) through (c) collectively, the “Company Financial
Statements”). Except as set forth therein, the Company Financial Statements
present fairly, in all material respects, the combined financial position,
results of operations and cash flows of the Company Group, at the respective
dates set forth therein and for the respective periods covered thereby, and were
prepared in accordance with GAAP (except, in the case of the unaudited financial
statements, for the absence of footnotes and any year-end adjustments),
consistently applied.

Section 4.8. Absence of Certain Changes. Since the Balance Sheet Date, except as
expressly contemplated by this Agreement or as set forth in Section 4.8 of the
Disclosure Schedule, each member of the Company Group has conducted its business
only in the ordinary course, and there has not been (a) any event, occurrence,
development, circumstance or condition that would or would reasonably be
expected to, individually or in the aggregate, have a Material Adverse Effect on
the Company Group, (b) any damage, destruction or loss, whether or not covered
by insurance, that would or would reasonably be expected to, individually or in
the aggregate, have a Material Adverse Effect on the Company Group, (c) any
change in accounting methods, principles or practices affecting the Company
Group, except as required by GAAP or (d) any (i) adoption, entry into,
termination or amendment of any Company Plan or other agreement, plan or policy
involving the Company Group and one or more current or former director, officer,
employee or independent contractor of any member of the Company Group (each, a
“Participant”), (ii) increase in the compensation, bonus or fringe or other
benefits of, or grant or payment of any type of compensation or benefits to, any
Participant not previously receiving or entitled to receive such type of
compensation or benefits, other than, in the case of employees who are neither
directors nor officers, normal increases in base cash compensation in the
ordinary course of business consistent with past practice, (iii) payment of any
benefit or amount not required under any Company Plan as in effect on the date
of this Agreement, other than wages and salaries in the ordinary course of
business consistent with past practice, (iv) grant or payment to any Participant
of, or grant to any Participant of any right to receive, any severance,
termination, change in control, retention or similar compensation or benefits or
increase in any manner such compensation or benefits, (v) payment of any
benefits, or grant of any awards, under or entry into, amendment or termination
of, any bonus, incentive, performance or other compensation plan or arrangement,
Company Plan (including the grant of any equity, equity-based or equity-related
awards or rights or “phantom” units or the removal of existing restrictions in
any Company Plan or agreements or awards made thereunder), (vi) amendment or
modification of any Restricted Common Units, Common Phantom Units, Preferred
Phantom Units or Assigned Hurdle Units, (vii) action to fund or in any other way
secure the payment of compensation or benefits under any employee plan,
agreement, contract or arrangement or Company Plan, (viii) action to accelerate
the vesting or payment of any compensation or benefit under any Company Plan or
(ix) change the manner in which contributions to any Company Plan are made or
the basis on which such contributions are determined.

Section 4.9. Tax Matters.

(a) Except as set forth in Section 4.9 of the Disclosure Schedule:

(i) Each member of the Company Group has (A) filed, or caused to be filed, all
Tax Returns that it was required to file and (B) paid or caused to be paid all
Taxes due and payable except Taxes being contested in good faith and adequately
reserved against in the Company Financial Statements in accordance with GAAP.
All such Tax Returns were true, correct and complete in all material respects.
There are no Liens for Taxes on any of the assets of any member of the Company
Group other than Liens described in clause (b) of the definition of Permitted
Liens.

(ii) No member of the Company Group has received notice from a Governmental
Authority of a claim with respect to the Taxes of such member of the Company
Group, which claim is still outstanding. No Tax Return of any member of the
Company Group is currently, or has been, the subject of an audit by any
Governmental Authority and no notice of such an audit has been received by any
member of the Company Group.

(iii) No member of the Company Group has waived any statute of limitations with
respect to Taxes or agreed to any extension of time with respect to a Tax
assessment or deficiency which extension is still in effect. The relevant
statute of limitations or reassessment period is closed with respect to all Tax
Returns of each member of the Company Group for all taxable periods through
December 31, 2006.

(iv) No member of the Company Group is participating or has participated in a
listed transaction within the meaning of Treasury
Regulation Section 1.6011-4(b)(2).

(v) At all times since its formation, the Company has been treated as a
partnership for U.S. Federal and applicable state income Tax purposes. Neither
the Company nor any other Person on behalf of, or with respect to, the Company
has made or filed an election under Treasury Regulations Section 301.7701-3 for
the Company to be treated as an association taxable as a corporation. Each
Subsidiary of the Company is an entity disregarded from the Company for U.S.
Federal and applicable state income Tax purposes.

Section 4.10. Real Property.

(a) No member of the Company Group owns any real property.

(b) Section 4.10(b) of the Disclosure Schedule lists the street address of each
parcel of real property currently leased or subleased by any member of the
Company Group (the “Leased Real Property”). With respect to each Leased Real
Property, (i) the Company has delivered to Buyer a true and complete copy of the
lease or sublease in effect on the date hereof relating to such Leased Real
Property, together with all amendments thereto, (ii) there has not been any
sublease or assignment entered into by any member of the Company Group in
respect of the lease or sublease relating to such Leased Real Property,
(iii) the lease or sublease relating to such Leased Real Property is legal,
valid, binding and enforceable and is in full force and effect and (iv) no
member of the Company Group and, to the Company’s Knowledge, no lessor, is in
default in any material respect under the lease or sublease relating to such
Leased Real Property.

Section 4.11. Intellectual Property.

(a) Set forth on Section 4.11(a) of the Disclosure Schedule are all (i) patents
and patent applications, (ii) trademark and service mark registrations and
applications for registration thereof, and (iii) copyright registrations and
applications for registration thereof, in each case that are owned by a member
of the Company Group or licensed from a third party by a member of the Company
Group (as indicated on Section 4.11(a) of the Disclosure Schedule). With respect
to each item of Intellectual Property listed on Section 4.11(a) of the
Disclosure Schedule, except as listed in Section 4.11(a) of the Disclosure
Schedule, no member of the Company Group has received written notice of any
pending or threatened Action that challenges the validity, enforceability,
registration or ownership (or license rights) of the item.

(b) Except as would not have a Material Adverse Effect on the Company Group, a
member of the Company Group owns, or is licensed or otherwise possesses
sufficient legally enforceable rights to use, all Intellectual Property that is
necessary for or currently used by the Company Group in the operation of the
Business.

(c) To the Company’s Knowledge, the Business of the Company Group is not
currently operated in a manner that infringes upon any Intellectual Property
rights of any third parties.

(d) To the Company’s Knowledge, except as would not have a Material Adverse
Effect on the Company Group, no third party is infringing upon any Intellectual
Property owned by any member of the Company Group.

(e) The Company Group is taking commercially reasonable measures to maintain and
protect the confidentiality of the trade secrets owned by any member of the
Company Group that are material to the Business

(f) The Company also makes the additional representations and warranties as to
certain Intellectual Property matters set forth in Section 4.11(f) of the
Disclosure Schedule.

Section 4.12. Environmental Matters. Except as would not and would not
reasonably be expected to, individually or in the aggregate, have a Material
Adverse Effect on the Company Group:

(a) the Company is, and for the last two (2) years has been, in compliance with
all Environmental Laws, and no member of the Company Group has received any
written notice from any Person alleging that any member of the Company Group is
in violation of any Environmental Law;

(b) no member of the Company Group is subject to any outstanding consent decree,
compliance order or administrative order pursuant to any Environmental Law;

(c) no Action is pending or, to the Company’s Knowledge, threatened against any
member of the Company Group pursuant to any Environmental Law; and

(d) there have been no Releases of or exposure to any Hazardous Material that
could reasonably be expected to form the basis of any Action against, or
Liability of, any member of the Company Group under or pursuant to any
Environmental Law.

Section 4.13. Contracts.

(a) Section 4.13(a) of the Disclosure Schedule lists the following written
contracts or agreements to which any member of the Company Group is a party and
which are in effect on the date hereof, other than any lease agreements for
Leased Real Property (which are addressed in Section 4.10):

(i) all supply and distribution agreements;

(ii) all swap, exchange, commodity option or hedging agreements;

(iii) any written employment agreement or employment contract that provides for
an annual base salary, and any written change in control, retention, severance
or termination agreement or contract that provides for any Liability of the
Company Group, in each case in excess of $100,000;

(iv) any collective bargaining agreement or other contract with any labor
organization, union or association;

(v) any contract pursuant to which any member of the Company Group has acquired
assets (whether tangible or intangible) material to the Business since the
Company’s inception;

(vi) any contract requiring a capital expenditure or known commitment by any
member of the Company Group in excess of $150,000 in any calendar year;

(vii) any contract requiring known or liquidated expenditures or payments to or
from any member of the Company Group in excess of $150,000 in any calendar year,
other than those that can be terminated without material penalty by such member
of the Company Group upon not more than ninety (90) days’ notice;

(viii) any contract that contains a covenant not to compete applicable to a
member of the Company Group;

(ix) any contract or agreement under which any member of the Company Group has
(A) created, incurred, assumed or guaranteed (or may create, incur, assume or
guarantee) Indebtedness, (B) granted a Lien on its assets, whether tangible or
intangible (to secure any Indebtedness or otherwise) or (C) extended credit to
any Person, in each case, in an amount in excess of $100,000 of committed
credit;

(x) all consulting, management services or other similar agreements;

(xi) any contract or agreement between or among a member or members of the
Company Group, on the one hand, and any of the Members or their Affiliates
(other than any member of the Company Group), on the other hand;

(xii) any contract or agreement establishing any joint venture, strategic
alliance or other collaboration that is material to the business of the Company
Group;

(xiii) any contract or agreement with clinical research organizations pursuant
to the terms of which there is a current obligation or right of the Company to
make annual payments in excess of $150,000 or to receive annual payments in
excess of $150,000;

(xiv) any contract or agreement pursuant to which any member of the Company
Group licenses or otherwise obtains Intellectual Property from a third party
that is used in any products of any member of the Company Group (including any
asset purchase agreement pursuant to which any member of the Company Group
purchased Intellectual Property);

(xv) any contract pursuant to which a third party manufactures any product or
product candidate of any member of the Company Group;

(xvi) any material contract relating to the design, development, or testing of
any product or product candidate of any member of the Company Group;

(xvii) any contract providing for indemnification of any Person with respect to
material liabilities relating to any current or former business of any member of
the Company Group or any predecessor person;

(xviii) the ten (10) largest contracts, by dollar value, with either a group
purchasing organization, managed care organization or third-party payor or
relating to any federal or state program; and

(xix) any other contract, whether or not made in the ordinary course of
business, that is material to any member of the Company Group or the conduct of
the Business.

All contracts and agreements set forth in Section 4.13(a) of the Disclosure
Schedule are referred to herein as “Material Contracts.” The Company has
provided Buyer and Merger Sub a copy of each Material Contract existing on the
date hereof.

(b) Except as set forth in Section 4.13(b) of the Disclosure Schedule,
(i) subject to the Remedies Exception, each Material Contract is in full force
and effect and is the legal, valid and binding obligation of the member of the
Company Group that is a party to such Material Contract and, to the Company’s
Knowledge, the other parties thereto (the “Other Parties”), and (ii) no member
of the Company Group or, to the Company’s Knowledge, any of the Other Parties to
any Material Contract is in breach, violation or default, and, to the Company’s
Knowledge, no event has occurred which with notice or lapse of time or both
would constitute a breach, violation or default by any such party, or permit
termination, modification or acceleration by the Other Parties, under such
Material Contract, except (A) for breaches, violations or defaults which would
not and would not reasonably be expected to, individually or in the aggregate,
have a Material Adverse Effect on the Company Group, and (B) that, in order to
avoid a default, violation or breach under any Material Contract, the Consent of
the Other Parties set forth in Section 4.6(c) of the Disclosure Schedule may be
required solely as a result of the transactions contemplated hereby.

Section 4.14. Insurance. The members of the Company Group maintain insurance
policies in such amounts, with such deductibles and against such risks and
losses as are, in the Company’s judgment, reasonable for the assets of the
Company Group and the conduct of the Business. The Company has provided Buyer
with claims information directly from each carrier of such insurance policies.
Except as set forth in Section 4.14 of the Disclosure Schedule, (a) no member of
the Company Group has received any notice from any insurer under any insurance
policy applicable to such member disclaiming coverage, reserving rights with
respect to a particular claim or such policy in general or canceling or
materially amending any such policy, (b) there is no claim, suit or other matter
currently pending in respect of which a member of the Company Group has received
such a notice and (c) the insurance policies applicable to the Company Group or
extensions or renewals thereof will be outstanding and duly in full force
without interruption until the Closing Date, with all premiums due and payable
thereon having been paid.

Section 4.15. Litigation. Except as set forth in Section 4.15 of the Disclosure
Schedule, (a) there are no Actions pending or, to the Company’s Knowledge,
threatened before any Governmental Authority against any member of the Company
Group or a predecessor in interest of a member of the Company Group which are
reasonably likely to result in Liability for any member of the Company Group
that would or would reasonably be expected to, individually or in the aggregate,
have a Material Adverse Effect on the Company Group and (b) there are no
outstanding Injunctions, judgments, orders, decrees or rulings to which any
member of the Company Group is a party or by which it is bound by, or with any
Governmental Authority that would or would reasonably be expected to,
individually or in the aggregate, have a Material Adverse Effect on the Company
Group.

Section 4.16. Employee Matters.

(a) Section 4.16(a) of the Disclosure Schedule contains a complete and accurate
list of each (i) pension plan (as defined in Section 3(2) of ERISA), “employee
benefit plan,” within the meaning of section 3(3) of ERISA, and bonus, incentive
or deferred compensation, retirement, profit-sharing, savings, equity or
equity-based, severance, change in control, retention, termination, welfare,
perquisite, fringe benefit, vacation, disability, death benefit,
hospitalization, medical, welfare benefit or other similar plan, program, policy
and arrangement, in each case, sponsored, maintained, contributed to, or
required to be maintained or contributed to, by any member of the Company Group
or any other person or entity that, together with any member of the Company
Group, is treated as a single employer under Section 414 of the Code (each, a
“Commonly Controlled Entity”) for the benefit of any Participant and (ii)
(A) employment, consulting, bonus, incentive or deferred compensation,
profit-sharing, savings, equity or equity-based, severance, change in control,
retention, termination, indemnification, loan or similar other agreement and
(B) agreement under which the benefits are contingent, or the terms of which are
materially altered, upon the occurrence of a transaction involving the Company
Group of a nature contemplated by this Agreement, in each case between the
Company Group, on the one hand, and any Participant, on the other hand (the
plans, programs, policies, arrangements and agreements in clauses (i) and (ii),
collectively, the “Company Plans”).

(b) Each Company Plan (and any related trust or other funding vehicle) has been
operated and administered, in all material respects, in accordance with its
terms and with applicable Law, including ERISA and the Code. Each member of the
Company Group is in compliance in all material respects with ERISA, the Code and
all other Laws applicable to the Company Plans.

(c) Each Company Plan which is an “employee pension benefit plan” within the
meaning of section 3(2) of ERISA and which is intended to be qualified under
section 401(a) of the Code has, to the extent applicable, received a
determination or opinion letter from the Internal Revenue Service.

(d) There is no pending or, to the Company’s Knowledge, threatened legal Action,
suit or claim, or investigations by any Governmental Authorities, relating to
the Company Plans (other than routine claims for benefits payable in the
ordinary course).

(e) No Company Plan is, and no member of the Company Group nor any Commonly
Controlled Entity has sponsored, maintained, contributed to, or been required to
maintain or contribute to, or has any actual or contingent liability under any
Company Plan that is, subject to section 302 or Title IV of ERISA or section 412
of the Code or is otherwise a defined benefit plan. No Company Plan is a
“multiemployer plan” within the meaning of section 3(37) of ERISA. No Company
Plan provides health, medical or other welfare benefits after retirement or
other termination of employment (other than for continuation coverage required
under section 4980(B)(f) of the Code), and no circumstances exist that could
result in any member of the Company Group becoming obligated to provide any such
benefits.

(f) With respect to each Company Plan, true and complete copies of the following
documents have been provided or made available to Buyer and Merger Sub, to the
extent applicable: (i) the most recent plan documents and all amendments
thereto; (ii) the most recent trust instruments and insurance contracts;
(iii) the two most recent reports on Form 5500 filed with the Internal Revenue
Service; (iv) the most recent summary plan description; (v) the most recent
determination or opinion letter issued by the Internal Revenue Service; and
(vi) the most recent financial statement and actuarial or other valuation
reports prepared with respect thereto.

(g) None of the execution and delivery of this Agreement or the consummation of
the Merger or any other transaction contemplated by this Agreement (alone or in
conjunction with any other event, including any termination of employment on or
following the Effective Time) will (i) entitle any Participant to any
compensation or benefit, (ii) accelerate the time of payment or vesting, or
trigger any payment or funding, of any compensation or benefits or trigger any
other material obligation under any Company Plan or (iii) result in any breach
or violation of, default under or limit the Company’s right to amend, modify or
terminate any Company Plan.

(h) No employees of any member of the Company Group are, or since January 1,
2004 have been, represented by any union with respect to their employment by any
member of the Company Group. There is not pending and since January 1, 2004
until the date hereof there has not been any material labor dispute, union
organization attempt or work stoppage, slowdown or lockout due to labor
disagreements. There is no, and since January 1, 2004 until the date hereof,
there has not been, any unfair labor practice charge, complaint or other
proceeding pending and, to the Knowledge of the Company, no such charge,
complaint or other proceeding is threatened, against any member of the Company
Group before the National Labor Relations Board or any other Governmental
Authority. Each member of the Company Group is, and since January 1, 2004, has
been, in compliance in all material respects with all applicable laws relating
to employment and employment practices, occupational safety and health
standards, terms and conditions of employment and wages and hours, and is not,
and since January 1, 2004, has not, engaged in any unfair labor practice. There
are no material complaints, controversies, lawsuits or other proceedings pending
or, to the Knowledge of the Company, threatened against any member of the
Company Group brought by or on behalf of any applicant for employment, any
Participant or any class of the foregoing, relating to any such law, or alleging
breach of any express or implied contract of employment or of any other wrongful
or tortious conduct in connection with the employment relationship. There are no
pending or, to the Knowledge of the Company, threatened, investigations, audits,
complaints, or proceedings against any member of the Company Group by or before
any Governmental Authority, whether domestic or foreign, respecting or involving
any applicant for employment, any Participant or any class of the foregoing.

Section 4.17. Legal Compliance. Except with respect to Tax matters (which are
addressed exclusively in Section 4.9), Intellectual Property matters (which are
addressed exclusively in Section 4.11) and employee matters (which are addressed
exclusively in Section 4.16), no member of the Company Group is in violation of
any Law applicable to its business or operations, except for violations and
failures to comply that would not and would not reasonably be expected to,
individually or in the aggregate, have a Material Adverse Effect on the Company
Group. No Governmental Authority has commenced or threatened to initiate any
action to withdraw any approvals or registrations relating to the Business or
any Product, or request the recall of any Product, or commenced or threatened to
initiate any action to enjoin production of any Product.

Section 4.18. Brokers’ Fees. Except as set forth in Section 4.18 of the
Disclosure Schedule, no member of the Company Group has entered into any
contract or other arrangement or understanding (written or oral, express or
implied) with any Person which may result in the obligation of Buyer, Merger Sub
or any of their respective Affiliates or the Company to pay any fees or
commissions to any broker or finder as a result of the execution and delivery of
this Agreement or the consummation of the transactions contemplated by this
Agreement.

Section 4.19. Permits. Each material Permit of the Company Group is set forth in
Section 4.19(a) of the Disclosure Schedule. Except as set forth in
Section 4.19(b) of the Disclosure Schedule, the Company Group has all Permits
required to conduct the Business as currently conducted and operated, except for
such Permits which the failure to have or obtain would not and would not
reasonably be expected to, individually or in the aggregate, have a Material
Adverse Effect on the Company Group. Each such Permit is in full force and
effect and the applicable member of the Company Group is in compliance with all
its obligations with respect thereto, except for such failure to be in full
force and effect or non-compliance as would not and would not reasonably be
expected to, individually or in the aggregate, have a Material Adverse Effect on
the Company Group. Notwithstanding the foregoing, each Permit set forth in
Section 4.19(c) of the Disclosure Schedule is in full force and effect and the
applicable member of the Company Group is in compliance, in all material
respects, with all its obligations with respect thereto. There are no Actions
pending or, to the Company’s Knowledge, threatened which might reasonably be
expected to result in the revocation or termination of any material Permit of
the Company Group.

Section 4.20. Transaction with Affiliates; Ownership of Assets. Except as set
forth in Section 4.20 of the Disclosure Schedule, there is not any contract,
agreement or any other arrangement between any member of the Company Group, on
the one hand, and any Member or any Affiliate of any Member, on the other hand,
will continue in effect subsequent to the Closing. Except as set forth in
Section 4.20 of the Disclosure Schedule, after the Closing no Member and no
Affiliate of any Member will have any interest in any asset or property (real or
personal, tangible or intangible) of any member of the Surviving Company Group.

Section 4.21. No Additional Representations and Warranties. Except for the
Company’s representations and warranties provided in this Article IV, none of
the Company or the holders of Units or Phantom Units or any of their respective
Affiliates, or any of their respective directors, officers, employees,
stockholders, partners, members or representatives has made, or is making, any
representation or warranty whatsoever to Buyer or any of its Affiliates with
respect to the Company Group.

ARTICLE V.

REPRESENTATIONS AND WARRANTIES REGARDING BUYER AND MERGER SUB

Buyer and Merger Sub jointly and severally represent and warrant to the Company
as follows:

Section 5.1. Organization. Each of Buyer and Merger Sub is duly organized,
validly existing and in good standing under the laws of the State of Delaware.
Each of Buyer and Merger Sub has all requisite power and authority to carry on
its business as it is currently conducted and to own, lease and operate its
properties where such properties are now owned, leased or operated. Each of
Buyer and Merger Sub is duly qualified or licensed to do business and is in good
standing in each jurisdiction in which the property owned, leased or operated by
it or the nature of the business conducted by it makes such qualification or
license necessary, except where the failure to be so duly qualified or licensed
or in good standing would not and would not reasonably be expected to,
individually or in the aggregate, have a Material Adverse Effect on Buyer or
Merger Sub.

Section 5.2. Authorization. Each of Buyer and Merger Sub has all requisite power
and authority to execute and deliver this Agreement and the other Transaction
Documents to which it is or will be party, to perform its obligations hereunder
and thereunder and to consummate the transactions contemplated hereby and
thereby. The execution, delivery and performance by Buyer and Merger Sub of this
Agreement and the other Transaction Documents to which Buyer and/or Merger Sub
is or will be a party and the consummation of the transactions contemplated
hereby and thereby have been duly authorized by all necessary action on the part
of Buyer and Merger Sub. This Agreement has been duly executed and delivered by
Buyer and Merger Sub and, assuming this Agreement constitutes a legal, valid and
binding obligation of the Company, constitutes a legal, valid and binding
obligation of each of Buyer and Merger Sub, enforceable against each of them in
accordance with its terms, subject to the Remedies Exception.

Section 5.3. Noncontravention. Neither the execution and delivery of this
Agreement by Buyer and Merger Sub, nor the consummation by Buyer and Merger Sub
of the transactions contemplated hereby, will (a) conflict with any provision of
the organizational documents of Buyer or Merger Sub, (b) violate or result in a
breach of any material agreement, contract, lease, license, instrument or other
arrangement to which Buyer, Merger Sub or any of their Affiliates is a party or
by which any of their respective properties are bound, or (c) violate any Law to
which Buyer, Merger Sub or any of their Subsidiaries is subject, except, in the
case of clauses (b) and (c), for such violations or breaches which would not and
would not reasonably be expected to, individually or in the aggregate, have a
Material Adverse Effect on Buyer or Merger Sub.

Section 5.4. Consents, Government Authorizations. Except for (a) compliance with
the HSR Act and the regulations thereunder and any other antitrust or merger
notification or control Laws, (b) compliance with any applicable requirements of
the Securities Act and any other applicable securities Laws, (c) Consents that,
if not obtained or made, would not and would not reasonably be expected to,
individually or in the aggregate, have a Material Adverse Effect on Buyer or
Merger Sub and (d) those Consents of Government Authorities set forth in Section
5.4 of the Disclosure Schedule, no Consent is required to be obtained or made by
Buyer or Merger Sub in connection with the execution and delivery of this
Agreement or the consummation of the transactions contemplated hereby.

Section 5.5. Financial Capacity. Buyer has as of the date hereof, and at the
Closing will have, sufficient cash in immediately available funds to pay the
Adjusted Merger Consideration in accordance with the terms of Article III and
any other amounts to be paid by it hereunder.

Section 5.6. Litigation. Except as set forth in Section 5.6 of the Disclosure
Schedule, there are no Actions pending or, to each of Buyer’s and Merger Sub’s
Knowledge, threatened before any Governmental Authority against Buyer, Merger
Sub or any of their Affiliates which would have or would reasonably be expected
to have, individually or in the aggregate, a Material Adverse Effect on Buyer or
Merger Sub, and there are no outstanding Injunctions, judgments, orders,
decrees, rulings, or charges to which Buyer, Merger Sub or any of their
Affiliates is a party or by which Buyer, Merger Sub or any of their Affiliates
is bound, by or with any Governmental Authority which would have or would
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect on Buyer or Merger Sub.

Section 5.7. Brokers’ Fees. None of Buyer, Merger Sub or any of their Affiliates
has any contract or other arrangement or understanding (written or oral, express
or implied) with any Person which may result in the obligation of the Company,
the holders of Units, the holders of Phantom Units or any of their Affiliates to
pay any fees or commissions to any broker or finder as a result of the execution
and delivery of this Agreement or the consummation of the transactions
contemplated by this Agreement.

Section 5.8. Information. The Company Group has provided Buyer with such access
to the facilities, books, records and personnel of each member of the Company
Group and Affiliates as Buyer has deemed necessary and appropriate in order for
Buyer to investigate to its satisfaction the Business and properties of each
member of the Company Group and their Affiliates sufficiently to make an
informed investment decision to participate in the Merger and to enter into this
Agreement. Buyer (either alone or together with its advisors) has such knowledge
and experience in financial and business matters so as to be capable of
evaluating the merits and risks of participation in the Merger and is capable of
bearing the economic risks of such transaction. Buyer agrees to participate in
the Merger based upon its own investigation, examination and determination with
respect thereto as to all matters and without reliance upon any express or
implied representations or warranties of any nature made by or on behalf of or
imputed to any member of the Company Group, except as expressly set forth in
this Agreement.

ARTICLE VI.

COVENANTS

Section 6.1. Conduct of the Company. The Company covenants and agrees that,
except (a) as otherwise contemplated by this Agreement (including as described
in Section 6.1 of the Disclosure Schedule and the other matters contemplated by
the other Schedules and Exhibits hereto) and the other Transaction Documents or
(b) as otherwise approved in writing by Buyer or Merger Sub (which approval
shall not be unreasonably withheld or delayed), during the period commencing on
the date hereof and ending on the Closing Date, the Company will, and will cause
each other member of the Company Group to, conduct the Business in the ordinary
course and use its commercially reasonable efforts to maintain and preserve
intact the business of the Company Group in all material respects. Until the
Closing, except (a) as otherwise contemplated by this Agreement (including as
described in Section 6.1 of the Disclosure Schedule and the other matters
contemplated by the other Schedules and Exhibits hereto) and the other
Transaction Documents, (b) as required by any change in applicable Law or (c) as
otherwise approved in writing by Buyer or Merger Sub (which approval shall not
be unreasonably withheld or delayed), the Company will not, and will cause each
other member of the Company Group not to, take any of the following actions:

(i) (A) amend any organizational documents of a member of the Company Group or
(B) except for issuances of Preferred Units to existing Members in exchange for
capital contributions to the Company by such Members in accordance with the LLC
Agreement and the Equity Commitment Letter, authorize for issuance, issue,
grant, sell, deliver, dispose of, pledge or otherwise encumber any of the
membership interests or securities (including any Phantom Units) or other equity
interests of any member of the Company Group or issue any Rights to subscribe
for or acquire any of the membership interests or securities (including any
Phantom Units) or other equity interests of any member of the Company Group
(other than any of such issuances between the Company and/or any wholly owned
Subsidiary of the Company);

(ii) sell, transfer, license or otherwise dispose of or encumber any of the
material assets pertaining to the business of the Company Group;

(iii) fail to exercise any rights of renewal with respect to any lease of any
Leased Real Property that by its terms would otherwise expire, or materially
modify, amend, terminate or permit the lapse of any such lease;

(iv) other than (A) Indebtedness prepayable by the Company without penalty and
(B) incremental Indebtedness in the ordinary course of business pursuant to the
terms of arrangements in existence as of the date hereof, incur or assume
Indebtedness;

(v) acquire (by merger, consolidation or combination, or acquisition of stock or
assets) any corporation, partnership or other business organization or division
thereof;

(vi) acquire assets (tangible or intangible), except for transactions not in
excess of $100,000;

(vii) except as required by GAAP, change any accounting methods, principles or
practices;

(viii) enter into, modify or terminate a Material Contract; provided, however,
that for purposes of this Section 6.1(viii), references to “$150,000” in clauses
(vi), (vii) and (xiii) of Section 4.13(a) shall be replaced with references to
“$100,000”;

(ix) except as otherwise contemplated by this Agreement or as required to ensure
that any Company Plan is not then out of compliance with applicable Law or to
comply with any Company Plan entered into prior to the date hereof (to the
extent complete and accurate copies of which have been heretofore made available
to Parent), (A) adopt, enter into, terminate or amend any collective bargaining
agreement or Company Plan or other agreement, plan or policy involving any
member of the Company Group and one or more Participants, (B) increase in any
manner the compensation, bonus or fringe or other benefits of, or grant or pay
any type of compensation or benefits to, any Participant not previously
receiving or entitled to receive such type of compensation or benefits, other
than, in the case of employees who are neither directors nor officers, normal
increases in base cash compensation in the ordinary course of business
consistent with past practice, (C) pay any benefit or amount not required under
any Company Plan as in effect on the date of this Agreement, other than wages
and salaries in the ordinary course of business consistent with past practice,
(D) grant or pay to any Participant, or grant to any Participant the right to
receive, any severance, termination, change in control, retention or similar
compensation or benefits or increase in any manner such compensation or
benefits, (E) pay any benefits under or grant any awards under or enter into,
amend or terminate, any bonus, incentive, performance or other compensation plan
or arrangement, Company Plan (including the grant of any Restricted Common
Units, Phantom Units, Assigned Hurdle Units or other equity, equity-based or
equity-related awards or rights or “phantom” units or the removal of existing
restrictions in any Company Plan or agreements or awards made thereunder),
(F) amend or modify any Restricted Common Units, Common Phantom Units, Preferred
Phantom Units or Assigned Hurdle Units, (G) take any action to fund or in any
other way secure the payment of compensation or benefits under any employee
plan, agreement, contract or arrangement or Company Plan, (H) take any action to
accelerate the vesting or payment of any compensation or benefit under any
Company Plan or (I) change the manner in which contributions to any Company Plan
are made or the basis on which such contributions are determined;

(x) settle any material Tax dispute or make any material Tax election;

(xi) permit, allow or suffer any of its assets to become subjected to any Lien
of any nature whatsoever, other than Permitted Liens;

(xii) cancel any material Indebtedness (individually or in the aggregate) or
waive any claims or rights of substantial value;

(xiii) make payment on any Company Transaction Expenses, any Retained
Liabilities or any fees or expenses recoverable by the Member Representative
pursuant to Article III or Article IX, other than payment on any Company
Transaction Expenses or Retained Liability due prior to the Closing in
accordance with the terms of such Company Transaction Expenses or Retained
Liability as in effect on the date hereof (with Buyer being notified of each
such payment and the terms thereof);

(xiv) enter into any settlement agreement with respect to any claim relating to
or arising from the conduct of the Business or otherwise waive or discharge any
such claim, or pay any material amount, or perform any material obligation, in
compromise of any claim that would be reasonably likely to restrict materially,
or have a material adverse effect on, the future conduct of the Business by the
Surviving Company;

(xv) engage in any acceleration or customer orders or sales through the granting
of discounts or financial incentives other than in the ordinary course of
business consistent with past practices; or

      (xvi)agree, whether in writing or otherwise, to do any of the foregoing.

Section 6.2.
  Access to Information; Confidentiality.
 
   

(a) Prior to the Closing Date, or, if earlier, the date this Agreement is
terminated pursuant to Section 10.1, the Company shall, and shall cause each
other member of the Company Group to, permit Buyer and its authorized agents or
representatives, including its independent accountants, to have reasonable
access to the properties, books and records of the Company Group during normal
business hours to review information and documentation relative to the
properties, books, contracts, commitments and other records of the Company Group
as Buyer may reasonably request; provided, that such investigation shall only be
upon reasonable notice and shall not disrupt personnel and operations of the
business of the Company or the Company Group. All requests for access to the
offices, properties, books and records of the Company Group shall be made to the
Member Representative or such representatives of the Company as the Member
Representative shall designate, who shall be solely responsible for coordinating
all such requests and all access permitted hereunder. It is further agreed that
neither Buyer nor any of its Affiliates or their respective representatives
shall contact any of the customers, suppliers, parties that have business
relationships with or are joint venture partners of any member of the Company
Group or any of their respective Affiliates with respect to any member of the
Company Group or otherwise in connection with the transactions contemplated
hereby, whether in person or by telephone, mail (electronic or otherwise) or
other means of communication, without the specific prior authorization of the
Member Representative. Any access to the offices, properties, books and records
of the Company Group shall be subject to the following additional limitations:
(i) Buyer shall give the Member Representative notice of at least three
(3) Business Days before conducting any inspections or communicating with any
third party relating to any member of the Company Group or any property of the
Company Group, and the Member Representative or a representative of the Company
Group designated by the Member Representative shall have the right to be present
when Buyer, any of its Affiliates or their respective representatives conducts
such investigations; and (ii) Buyer, its Affiliates and their respective
representatives shall use its commercially reasonable efforts to perform all
on-site due diligence reviews and all communications with any Person on an
expeditious and efficient basis.

(b) Buyer, Merger Sub and their respective Affiliates and representatives will
hold in confidence all confidential information obtained from any holder of
Units, any holder of Phantom Units, the Company Group or their respective
Affiliates, officers, agents, representatives or employees, whether or not
relating to the Business, in accordance with the provisions of the
Confidentiality Agreement which, notwithstanding anything contained therein,
shall remain in full force and effect following the execution of this Agreement
and shall survive any termination of this Agreement in accordance with the terms
of the Confidentiality Agreement.

Section 6.3. Efforts. Subject to the terms and conditions of this Agreement and
applicable Law, each of the Parties hereto shall use its commercially reasonable
efforts to take, or cause to be taken, all actions, and to do, or cause to be
done, all things reasonably necessary, proper or advisable under applicable Laws
and regulations or otherwise to consummate and make effective the transactions
contemplated by this Agreement as soon as practicable, including such actions or
things as any other Party hereto may reasonably request in order to cause any of
the conditions to such other Party’s obligation to consummate such transactions
specified in Article VII to be fully satisfied.

Section 6.4. Approvals. Without limiting the generality of Section 6.3:

(a) The Parties shall (and shall cause their respective directors, officers and
Subsidiaries, and use their commercially reasonable efforts to cause their
respective Affiliates, employees, agents, attorneys, accountants and
representatives, to) consult and fully cooperate with and provide reasonable
assistance to each other in (i) obtaining all necessary Consents, including,
without limitation, those Consents set forth in Sections 4.6(c), 4.6(e), 5.4 and
7.1(c) of the Disclosure Schedule, or other permission or action by, and giving
all necessary notices to and making all necessary filings, meetings or
appearances with and applications and submissions to, any Governmental Authority
(the “Governmental Approvals”) or other Person, (ii) lifting any permanent or
preliminary injunction or restraining order or other similar order issued or
entered by any court or Governmental Authority (an “Injunction”) of any type
referred to in Section 7.1(a) and (iii) in general, consummating and making
effective the transactions contemplated hereby. Subject to Article X, the
Parties and their Affiliates shall not take any action inconsistent with their
obligations under this Agreement, or enter into or complete any transactions
that could reasonably be expected to materially delay or hinder or prohibit the
consummation of the transactions contemplated hereby, including causing the
failure of the closing conditions set forth in Article VII to be satisfied.

(b) The Company, Buyer and Merger Sub shall timely and promptly cause to be made
all filings with Governmental Authorities which may be required by each of them
and their respective Affiliates in connection with the consummation of the
transactions, including the filing of a notification and report form under the
HSR Act within ten (10) days of the date hereof. Each Party shall furnish to the
other Party such necessary information and assistance as such other Party may
reasonably request in connection with the preparation of any necessary filings
or submissions by it to any Governmental Authority.

(c) Each of the Parties shall notify and keep the other Party advised as to
(i) any material communication from any Governmental Authority regarding any of
the transactions contemplated hereby and (ii) any Action pending and known to
such Party, or to its Knowledge threatened, which challenges the transactions
contemplated hereby. Without in any way limiting the foregoing, the Parties will
also consult and cooperate with one another, and consider in good faith the
views of one another, in connection with any analyses, appearances,
presentations, memoranda, briefs, arguments, opinions and proposals made or
submitted by or on behalf of any Party in connection with any Governmental
Approvals. Subject to the provisions of Article X, the Company, Buyer and Merger
Sub shall not take any action inconsistent with their obligations under this
Agreement or which would materially hinder or delay the consummation of the
transactions contemplated by this Agreement.

Section 6.5. Public Announcements. Except to the extent otherwise required by
applicable Law or the rules or regulations of any securities exchange (and then
only after consultation with the other Parties hereto), none of the Parties will
issue any press release or make any other public announcements concerning the
transactions contemplated hereby or the contents of this Agreement or the
Transaction Documents without the prior written consent of the other Parties.

Section 6.6. Notification of Certain Matters. (a) Between the date hereof and
the Closing Date, each Party will give prompt written or electronic notice to
the other Parties after it becomes aware of: (i) the occurrence or
non-occurrence of any event which will result, or has a reasonable prospect of
resulting, in the failure of any condition, covenant or agreement contained in
this Agreement to be complied with or satisfied, (ii) any failure of a Party to
comply with or satisfy any condition, covenant or agreement to be complied with
or satisfied by it hereunder, and (iii) except for such Consents the necessity
of which to obtain, file or give has been disclosed herein or in the Schedules
hereto, any notice or other communication from any third party alleging that the
Consent of such third party is or may be required in connection with the
transactions contemplated by this Agreement or that such transactions otherwise
may violate the rights of or confer remedies upon such third party.

(b) At least three (3) days prior to the Closing, the Company shall furnish to
Buyer and the Merger Sub a statement, certified by the chief executive officer
and the chief financial officer of the Company and reviewed by the Company’s
independent auditors (with such independent auditors expressing in writing that
they have no objections to the information contained therein), setting forth
(i) the amounts of Company Transaction Expenses and Retained Liabilities to be
funded by Buyer to the Company at Closing under Section 3.6(b) and (ii) an
estimate of the amount of Working Capital, calculated in accordance with the
provisions of Section 3.7 (such estimate, the “Estimated Closing Date Working
Capital”), which statement shall be reasonably satisfactory to Buyer.

Section 6.7. Director and Officer Indemnification. For six (6) years from and
after the Closing Date, to the fullest extent permitted by applicable Law and
the organizational documents of the Company immediately prior to the date of
this Agreement, Buyer shall cause the Surviving Company and the Surviving
Company’s Subsidiaries (collectively, the “Surviving Company Group”) to
indemnify and hold harmless the officers, managers and directors of any member
of the Company Group who held any such position at any time on or prior to the
Effective Time (collectively, “Indemnified Officers”), to the same extent as
such Indemnified Officers are indemnified by the Company Group on the date
hereof, in respect of acts or omission occurring prior to the Closing, and Buyer
shall cause the applicable member of the Surviving Company Group to maintain for
six (6) years from and after the Closing indemnification provisions in its
organizational documents that are no less favorable to the Indemnified Officers
than those in effect with respect to such member of the Company Group
immediately prior to the date of this Agreement. Buyer shall cause to be
obtained and maintained in effect, for a period of six (6) years after the
Closing, policies of directors’ and officers’ liability insurance protecting the
Indemnified Officers with coverages and containing terms and conditions
(including with respect to deductible, amount and payment of attorneys’ fees)
that are no less favorable than those in existing policies of the Company as of
the date hereof. Buyer may, at its option, select the insurance broker for
effecting such insurance policies. The Company shall have the right, but not the
obligation, to acquire a six (6) year tail policy for the Persons currently
covered by the Company’s directors’ and officers’ liability insurance policy
that is consistent with the second preceding sentence. Such policy shall be
prepaid at the Closing and shall be non-cancelable. Notwithstanding any other
provision of this Agreement to the contrary, each of the Parties agrees that
from and after the Closing Date each Indemnified Officer shall be a third party
beneficiary under this Agreement for purposes of enforcing this Section 6.7.

Section 6.8. Employee Benefit Arrangements.

(a) From and after the Closing Date, Buyer shall, and shall cause the Surviving
Company Group to, honor, pay, perform and satisfy any and all Liabilities,
obligations and responsibilities to or in respect of each of the employees
(including those employees who are full-time, part-time, temporary, on vacation
or on a paid or unpaid leave of absence) of any member of the Company Group and
the directors of any member of the Company Group (in each case, as determined as
of the Closing Date) (collectively, the “Company Group Employees”) arising under
the terms of any Company Plan as in effect immediately prior to the Closing
Date, in accordance with the terms of such Company Plan.

(b) Without limiting the foregoing and notwithstanding anything contained herein
to the contrary, for a period of not less than one (1) year following the
Closing Date, Buyer shall, and shall cause the Surviving Company Group to,
provide each Company Group Employee who continues employment with a member of
the Surviving Company Group or any of its Affiliates with compensation and
benefits (including with respect to severance and annual bonus opportunities but
excluding equity or equity-based compensation) that are not less favorable in
the aggregate than the compensation and benefits provided to such Company Group
Employee immediately prior to the Closing Date. Buyer shall, and shall cause the
Surviving Company Group to, cause each employee benefit plan (including, but not
limited to, each severance plan or arrangement) maintained or contributed to by
Buyer or any of its Affiliates and in which a Company Group Employee
participates, solely to the extent that Buyer makes such plan available to such
Company Group Employee, provide credit for any employee co-payments or similar
amounts and to recognize all service of such Company Group Employee with any
member of the Company Group for purposes of eligibility and vesting (except that
such service (i) shall not be counted to the extent that it would result in a
duplication of benefits, (ii) shall be counted for eligibility only for
applicable Buyer severance plans and arrangements and (iii) shall not be counted
for purposes of benefit accrual under any defined benefit plan) and, if
applicable, to waive any exclusions for preexisting conditions under any such
health or welfare plans.

(c) The Company shall ensure that following the Effective Time, no holder of a
Restricted Common Unit, Common Phantom Unit, Preferred Phantom Unit or Assigned
Hurdle Unit (or former holder of a Restricted Common Unit, Common Phantom Unit,
Preferred Phantom Unit or Assigned Hurdle Unit) or any Participant shall have
any right under any Company Plan to acquire any equity interests or voting
securities of any member of the Company Group or the Surviving Company Group
(including “phantom” equity or equity appreciation rights).

(d) Notwithstanding the foregoing, no provision of this Section 6.8, whether
express or implied, shall, in and of itself, (i) constitute or create an
employment agreement with any Company Group Employee, (ii) be treated as an
amendment or other modification of any Company Plan or any other plan or
arrangement covering the Company Group Employees, or (iii) limit the right of
Buyer to amend, terminate or otherwise modify, or to cause the Surviving Company
Group to amend, terminate or otherwise modify, any existing benefit plan or
arrangement following the Closing Date. Nothing in this Section 6.8 shall create
any third party beneficiary rights in any Person other than the parties to this
Agreement, including no third party beneficiary rights in any current or former
Company Group Employee or any beneficiary or dependent thereof.

Section 6.9. Post-Closing Access; Preservation of Records. From and after the
Closing, Buyer will cooperate in good faith with the holders of Units and the
holders of Phantom Units in respect of Tax matters (including Actions with
respect to Taxes); provided, however, that such cooperation shall not interfere
with the normal operations of the Surviving Company Group and the reasonable
out-of-pocket expenses of the Surviving Company Group incurred in connection
therewith will be paid by such holder of Units or Phantom Units. Buyer will
cause the Surviving Company Group to maintain and preserve all Tax Returns,
books, records and other documents that are reasonably necessary for such
cooperation for the lesser of (i) seven (7) years after the Closing Date and
(ii) any applicable statutory or regulatory retention period, as the same may be
extended.

Section 6.10. Further Assurances. Each Party agrees that from time to time after
the Closing Date, it will execute and deliver or cause its respective Affiliates
to execute and deliver such further instruments, and take (or cause their
respective Affiliates to take) such other action, as may be reasonably necessary
to carry out the purposes and intents of this Agreement and the other
Transaction Documents.

Section 6.11. No Solicitation. From the date hereof until the Closing Date or
the termination of this Agreement pursuant to Section 10.1, neither the Company
nor the Member Representative will, and the Company shall cause each other
member of the Company Group and any officer, director, employee, representative,
agent and advisor of any member of the Company Group not to (a) directly or
indirectly solicit or encourage any inquiries or proposals for, or enter into or
continue any discussions with respect to, the acquisition (including by merger,
recapitalization or similar transaction) by any Person (other than a holder of
Units or Phantom Units, as permitted by Section 6.1) of any of the Units,
Phantom Units or other membership interest (or phantom membership interest) or
other securities of any other member of the Company Group or any of the assets
of the Company Group material to the Business (an “Acquisition Transaction”), or
(b) furnish or permit to be furnished any non-public information concerning the
Company Group or its Business to any Person (other than Buyer, Merger Sub or
their Affiliates and respective agents and representatives), other than
information furnished in the ordinary course of business. Each of the Company
and the Member Representative shall promptly notify Buyer of any inquiry or
proposal received by it or its representatives with respect to any such
Acquisition Transaction.

Section 6.12. Supplemental Disclosure. Up to five (5) days prior to the
scheduled Closing Date, the Company may correct or supplement in writing any
information furnished in the Disclosure Schedule, including any information that
is materially incorrect or incomplete as a result of any facts or circumstances
occurring or arising after the date hereof, and shall promptly furnish such
supplemented information to Buyer. Thereafter, prior to the Closing, the Company
shall promptly notify Buyer in writing of any additional corrections or
supplements to the Disclosure Schedule. Any such corrected or supplemental
information shall not be deemed to amend this Agreement for purposes of
determining the satisfaction of the closing condition set forth in
Section 7.3(a) or for purposes of determining whether any person is entitled to
indemnification pursuant to Article VIII.

Section 6.13. Tax Treatment of Transactions. To the extent the Company ceases to
be classified as a partnership for U.S. Federal income Tax purposes as a result
of the transactions contemplated by this Agreement, the transactions
contemplated by this Agreement shall be treated for all U.S. Federal income Tax
purposes as a sale by the Members of partnership interests of the Company and as
a purchase by Buyer of the assets and liabilities of the Company.

Section 6.14. Purchase Price Allocation. Buyer and the Member Representative
shall negotiate in good faith to enter into an agreement on or after the Closing
Date concerning the allocation of the Merger Consideration (including any
adjustments thereto) and the assumed liabilities among the assets of the Company
for Tax purposes (such allocation, which shall be in accordance with Federal Tax
principles, the “Allocation”), and the Allocation shall be made pursuant to the
following procedure:

  (a)   as soon as reasonably practicable after the Closing Date, Buyer shall
deliver to the Member Representative a proposed Allocation (such proposed
Allocation, the “Proposed Allocation”);

  (b)   the Member Representative may object to the Proposed Allocation in
writing within fifteen (15) Business Days of the delivery of the Proposed
Allocation but only if such objection, if sustained, would result in (i) a
reduction of the aggregate amount of the Proposed Allocation that is allocated
to those assets the deemed disposition of which results in short-term capital
gain or ordinary income for tax purposes (“Ordinary Income Assets”) for the
Members and (ii) a corresponding increase in the aggregate amount of the
Proposed Allocation that is allocated to assets other than Ordinary Income
Assets (each such objection, a “Permissible Objection”) (it being understood
that the term Permissible Objection shall encompass an objection regarding the
allocation of a portion of the Merger Consideration to a covenant not to
compete); the Member Representative shall be deemed to have accepted and agreed
to the Proposed Allocation (and the Proposed Allocation shall become the
Allocation and shall be binding on Buyer, the Member Representative and the
Members for all purposes) if such notice is not delivered to the Buyer within
fifteen (15) Business Days of the Buyer’s delivery of the Proposed Allocation;

  (c)   if the Member Representative provides timely notice to Buyer, in
accordance with Section 6.14(b), that it objects to the Proposed Allocation,
then Buyer and the Member Representative shall negotiate in good faith about any
Permissible Objection for fifteen (15) days after the delivery of such notice;

  (d)   if Buyer and the Member Representative agree to amend the Proposed
Allocation as a result of reaching a written agreement about a Permissible
Objection, then the Proposed Allocation, as so amended, shall become the
Allocation and shall be binding on Buyer and the Members for all Tax purposes;

  (e)   if Buyer and the Member Representative cannot reach written agreement
amending the Proposed Allocation within the fifteen (15) day period set forth in
Section 6.14(c), then all unresolved Permissible Objections shall be immediately
submitted for resolution to the Accounting Firm. The Accounting Firm shall make
a final determination as to those unresolved Permissible Objections within
thirty (30) days after such submission. The fees and expenses of the Accounting
Firm shall be shared equally between the Member Representative and the Buyer;

  (f)   the determinations of the Accounting Firm shall be final and binding on
Buyer, the Members and the Member Representative for all Tax purposes; and

  (g)   Buyer, the Members and the Member Representative shall act in accordance
with any Allocation resulting from the procedures set forth in this Section 6.14
in any Tax Returns or similar filings. In the event that any Governmental
Authority disputes such Allocation, Buyer or the Member Representative, as the
case may be, shall promptly notify the other party of the nature of such
dispute.

ARTICLE VII.

CONDITIONS TO CLOSING

Section 7.1. Condition Precedent to Obligations of Buyer, Merger Sub and the
Company. The respective obligations of each Party to consummate the transactions
contemplated by this Agreement are subject to the satisfaction (or, where
legally permissible, waiver by such Party) at or prior to the Closing Date of
the following conditions:

(a) No Adverse Order. There shall be no material Injunction, restraining order
or decree of any nature of any Governmental Authority of competent jurisdiction
that is in effect that prohibits the consummation of the transactions
contemplated hereby.

(b) Antitrust Authorizations. All applicable waiting periods (and any extensions
thereof) under the HSR Act shall have expired or been terminated and any other
material competition approvals from any foreign Governmental Authority required
to be obtained in connection with the transactions contemplated hereby shall
have been obtained.

(c) Consents. The Consents set forth in Sections 4.6(e), 5.4 and 7.1(c) of the
Disclosure Schedule shall have been obtained or made, as applicable.

Section 7.2. Conditions Precedent to Obligation of the Company. The obligation
of the Company to consummate the transactions contemplated by this Agreement is
subject to the satisfaction (or waiver by the Company) at or prior to the
Closing Date of each of the following additional conditions:

(a) Accuracy of Buyer and Merger Sub’s Representations and Warranties. The
representations and warranties of Buyer and Merger Sub contained in Article V,
disregarding all qualifications contained herein relating to materiality or
Material Adverse Effect, shall be true and correct on and as of the Closing Date
with the same force and effect as though such representations and warranties had
been made on the Closing Date (except for such representations and warranties
which by their express provisions are made as of an earlier date, in which case
they shall be true and correct as of such date), except to the extent that the
failure of such representations and warranties to be true and correct would not
and would not reasonably be expected to, individually or in the aggregate, have
a Material Adverse Effect on Buyer or Merger Sub; and the Company shall have
received a certificate signed by a duly authorized officer of Buyer and Merger
Sub confirming the foregoing as of the Closing Date.

(b) Covenants and Agreements of Buyer and Merger Sub. Each of Buyer and Merger
Sub shall have performed and complied with all of its covenants and agreements
hereunder in all material respects through the Closing Date; and the Company
shall have received a certificate signed by a duly authorized officer of Buyer
and Merger Sub confirming the foregoing as of the Closing Date.

(c) Closing Deliveries. On or prior to the Closing Date, Buyer shall have made
or caused to be made all deliveries required in accordance with Section 3.6(b).

Section 7.3. Conditions Precedent to Obligations of Buyer and Merger Sub. The
obligation of each of Buyer and Merger Sub to consummate the transactions
contemplated by this Agreement is subject to the satisfaction (or waiver by each
of Buyer and Merger Sub) at or prior to the Closing Date of each of the
following additional conditions:

(a) Accuracy of the Company’s Representations and Warranties. The
representations and warranties of the Company contained in Article IV,
disregarding all qualifications contained herein relating to materiality or
Material Adverse Effect, shall be true and correct on and as of the Closing Date
with the same force and effect as though such representations and warranties had
been made on the Closing Date (except for such representations and warranties
which by their express provisions are made as of an earlier date, in which case
they shall be true and correct as of such date), except to the extent that the
failure of such representations and warranties to be true and correct would not
and would not reasonably be expected to, individually or in the aggregate, have
a Material Adverse Effect on the Company Group; and Buyer shall have received a
certificate from the Company signed by a duly authorized officer of the Company
confirming the foregoing as of the Closing Date.

(b) Covenants and Agreements of the Company. The Company shall have performed
and complied with all of its covenants and agreements hereunder in all material
respects through the Closing Date; and Buyer shall have received a certificate
from the Company signed by a duly authorized officer of the Company confirming
the foregoing as of the Closing Date.

(c) Closing Documents. On or prior to the Closing Date, the Company shall have
made or caused to be made all deliveries required to be delivered by the Company
in accordance with Section 3.6(a).

ARTICLE VIII.

INDEMNIFICATION

Section 8.1. Survival.

(a) (i) The representations and warranties contained in Article IV shall
terminate at 5:00 p.m. (Eastern Standard Time) on December 31, 2008 (the
“Survival Date”), (ii) the provisions of Article VIII, Article IX and Article XI
shall survive indefinitely and (iii) after the Closing, the indemnification
provisions under Sections 8.2(a)(i)(B) and 8.2(b)(ii) shall apply only to the
covenants and other agreements set forth in Article III and Sections 6.1,
6.2(b), 6.3, 6.4, 6.5, 6.7, 6.8(a), 6.8(b), 6.9, 6.10, 6.13 and 6.14. No other
representations, warranties or covenants of the Parties contained in this
Agreement shall survive the Closing. If a notice of a claim with respect to a
breach of a representation or warranty is asserted in writing and delivered
prior to the Survival Date, then such representation or warranty shall survive
solely in connection with such claim until such time as such claim is resolved
in accordance with the terms of this Article VIII.

(b) If prior to the Closing any Party (the “Waiving Party”) has knowledge of any
breach by any other Party of any representation, warranty or covenant contained
in this Agreement and, at least five (5) days prior to the Closing, such other
Party acknowledges in writing that the effect of such breach is a failure of any
condition to the Waiving Party’s obligations set forth in this Agreement and the
Waiving Party proceeds with the Closing, the Waiving Party shall be deemed to
have waived such breach and the Waiving Party and its successors, assigns and
affiliates shall not be entitled to be indemnified pursuant to this
Article VIII, to sue for Damages or to assert any other right or remedy for any
Damages arising from any matters relating to such condition or breach,
notwithstanding anything to the contrary contained herein or in any certificate
delivered pursuant hereto. Except as expressly provided in this Section 8.1(b),
the rights of each Buyer Indemnified Party under Sections 8.2(a), and the rights
of each Member Indemnified Party under Section 8.2(b), after the Closing shall
not be affected by any knowledge at or prior to the execution of this Agreement
or at or prior to the Closing of any breach of this Agreement, whether such
knowledge came from any member of the Company Group, the Member Representative
or any other Person, or any waiver of Section 7.2(a) or Section 7.3(a).

Section 8.2. Indemnification.

(a) (i) Subject to the provisions of this Article VIII, after the Closing,
Buyer, Merger Sub and their Affiliates (including the Surviving Company Group)
and Buyer’s, Merger Sub’s and such Affiliates’ respective officers, directors,
employees, partners, members, stockholders, and each of their respective
successors and assigns (collectively, the “Buyer Indemnified Parties”) shall be
entitled to indemnification solely from the Escrow Amount against all Damages
(excluding, except in the case of Third-Party Claims, punitive damages or loss
of profits) incurred by the Buyer Indemnified Parties or any of them arising
from or as a result of:

(A) subject to the limitations set forth in Section 8.1, the breach of any
representation or warranty of the Company contained in this Agreement;

(B) subject to the limitations set forth in Section 8.1, the breach or
non-performance by the Company of any of its covenants or other agreements
contained in this Agreement;

(C) all Company Transaction Expenses in excess of the amount thereof deducted
from the Base Merger Consideration in arriving at the Merger Consideration;

(D) all Retained Liabilities in excess of the amount thereof deducted from the
Base Merger Consideration in arriving at the Merger Consideration; and

(E) the amount by which the Adjusted Merger Consideration is less than the
Closing Date Payment; and

(F) any Pre-Closing Tax Liability.

(ii) The Buyer Indemnified Parties shall not be entitled to indemnification
under Section 8.2(a)(i)(A):

(A) unless the aggregate of all Damages for which the Buyer Indemnified Parties,
but for this Section 8.2(a)(ii)(A), are entitled to indemnification thereunder
exceeds on a cumulative basis an amount equal to $1,250,000, after which the
Buyer Indemnified Parties shall be entitled to indemnification for all Damages
for which they are entitled to indemnification under Section 8.2(a)(i)(A);
provided, however, that this Section 8.2(a)(ii)(A) shall not apply to any claim
for indemnification arising out of a breach or alleged breach of Section 4.1,
4.2, 4.4, 4.5 or 4.7; and

(B) for any individual items where the Damage relating thereto is less than
$100,000; provided, however, that (1) such item shall be aggregated for purposes
of the calculation of cumulative Damages under Section 8.2(a)(ii)(A) and
(2) this clause (B) shall not apply to any claim for indemnification arising out
of a breach or alleged breach of Section 4.1, 4.2, 4.4, 4.5 or 4.7.

(b) Subject to the provisions of this Article VIII, after the Closing, Buyer and
Merger Sub shall indemnify and hold harmless the Member Representative, each
holder of Units and each holder of Phantom Units and each of their officers,
directors, employees, partners, members, stockholders, and each of their
respective successors and assigns (where any such status is applicable before,
at or after the Closing) (collectively, the “Member Indemnified Parties”, and,
together with the Buyer Indemnified Parties, the “Indemnified Parties”) from and
against all Damages as incurred by the Company Indemnified Parties or any of
them arising from or as a result of:

(i) subject to the limitations set forth in Section 8.1, the breach of any
representation or warranty of Buyer or Merger Sub contained in this Agreement;
and

(ii) subject to the limitations set forth in Section 8.1, the breach or
non-performance by Buyer or Merger Sub of any of its covenants or other
agreements contained in this Agreement.

Section 8.3. Indemnification Procedures. Claims for indemnification under this
Agreement shall be asserted and resolved as follows:

(a) If a claim for indemnification is to be made by an Indemnified Party with
respect to any claims asserted against it by an unaffiliated third-party (a
“Third-Party Claim”) that could give rise to a right of indemnification under
this Article VIII, such Indemnified Party shall promptly (and in any event
within ten (10) Business Days following receipt of notice of the Third-Party
Claim) (i) notify the Party from whom indemnification is sought (which, in the
case of the holders of Units and the holders of Phantom Units, shall be, on
behalf of the holders of Units and the holders of Phantom Units, the Member
Representative) (such notified Party, the “Indemnifying Party”) of the
Third-Party Claim, and (ii) transmit to the Indemnifying Party a written notice
(a “Claim Notice”) describing in reasonable detail the nature of the Third-Party
Claim, a copy of all papers served with respect to such claim (if any), the
basis of the Indemnified Party’s request for indemnification under this
Article VIII, and a good-faith estimate of the amount of Damages attributable to
such claim. Failure to provide such Claim Notice shall not affect the right of
the Indemnified Party’s indemnification hereunder, except to the extent that the
Indemnifying Party is materially prejudiced as a result of such failure.

(b) The Indemnifying Party shall have the right to defend the Indemnified Party
against such Third-Party Claim, it being understood that such election shall be
without prejudice to the right of the Indemnifying Party to dispute whether such
claim involves indemnifiable Damages under this Article VIII. If the
Indemnifying Party notifies the Indemnified Party within thirty (30) days after
receipt of any Claim Notice that the Indemnifying Party elects to assume the
defense of the Third-Party Claim, then the Indemnifying Party shall have the
right to defend such Third-Party Claim with counsel selected by the Indemnifying
Party who is reasonably acceptable to the Indemnified Party, by all appropriate
proceedings. The Indemnifying Party shall have full control of such defense and
proceedings, including any compromise or settlement thereof, provided that the
Indemnifying Party shall not consent to the entry of a judgment or enter into
any settlement with respect to the matter without the prior written consent of
the Indemnified Party (which consent shall not be unreasonably withheld or
delayed). If an Indemnifying Party assumes such defense, the Indemnifying Party
shall not be liable for any amount required to be paid by the Indemnified Party
that exceeds, where the Indemnified Party has unreasonably withheld or delayed
consent in connection with the proposed compromise or settlement of a
Third-Party Claim, the amount for which that Third-Party Claim could have been
settled pursuant to that proposed compromise or settlement. No Third-Party Claim
that is being defended in good faith by the Indemnifying Party shall be settled
or compromised by the Indemnified Party without the written consent of the
Indemnifying Party (which consent shall not be unreasonably withheld or
delayed). Notwithstanding any dispute as to liability under this Article VIII,
if requested by the Indemnifying Party, the Indemnified Party shall act in good
faith in responding to, defending against, settling or otherwise dealing with
any Third-Party Claim and the Indemnified Party shall (in addition to, and not
in limitation of, its obligation to act in good faith), at the sole cost and
expense of the Indemnifying Party, cooperate with the Indemnifying Party and its
counsel in contesting any Third-Party Claim which the Indemnifying Party elects
to contest, including the making of any related counterclaim against the Person
asserting the Third-Party Claim or any cross complaint against any Person and
making available to the Indemnifying Party all witnesses, records, materials and
information in the Indemnified Party’s possession or under its control (or in
the possession or control of any of its Affiliates or representatives) relating
to the Third-Party Claim as may be reasonably requested by the Indemnifying
Party or its counsel. The Indemnified Party may participate in, but not control,
any defense or settlement of any Third-Party Claim controlled by the
Indemnifying Party pursuant to this Section 8.3(b), and the Indemnified Party
shall bear its own costs and expenses with respect to such participation;
provided, however, if in the opinion of outside counsel of the Indemnified Party
there is a conflict of interest between the Indemnifying Party and the
Indemnified Party, the Indemnifying Party shall bear the reasonable costs and
expenses of one counsel to the Indemnified Party reasonably acceptable to the
Indemnifying Party in connection with such defense.

(c) If the Indemnifying Party fails to notify the Indemnified Party within
thirty (30) days after receipt of any Claim Notice that the Indemnifying Party
elects to defend the Indemnified Party pursuant to Section 8.3(b), the
Indemnified Party shall have the right to defend, at the sole cost and expense
of the Indemnifying Party, the Third-Party Claim by all appropriate proceedings.
The Indemnified Party shall have full control of such defense and proceedings;
provided, however, that the Indemnified Party may not enter into any compromise
or settlement of such Third-Party Claim if indemnification is to be sought
hereunder, without the Indemnifying Party’s consent (which consent shall not be
unreasonably withheld or delayed). The Indemnifying Party may participate in,
but not control, any defense or settlement controlled by the Indemnified Party
pursuant to this Section 8.3(c), and the Indemnifying Party shall bear its own
costs and expenses with respect to such participation. If the Indemnifying Party
elects not to (or is deemed to have elected not to) assume the defense of a
Third-Party Claim, or elects to assume the defense of a Third-Party Claim, but
reserves the right to dispute whether such claim is an indemnifiable Damage
under this Article VIII, the determination of whether the Indemnified Party is
entitled to indemnification hereunder shall be resolved either by the Parties or
in an appropriate legal proceeding. Upon resolution of such dispute by the
Parties or receipt of a final and non-appealable order or determination from a
court of competent jurisdiction setting forth the resolution of such dispute,
the Indemnifying Party shall promptly pay the amount agreed in such resolution
or so ordered to be paid, if any.

(d) With respect to any indemnification sought by an Indemnified Party from the
Indemnifying Party that does not involve a Third-Party Claim, the Indemnified
Party shall promptly provide written notice to the Indemnifying Party of any
claim with respect to which the Indemnified Party believes it is or may be
entitled to indemnification pursuant to Section 8.1 hereof (an “Indemnity
Notice”). The Indemnity Notice shall describe in reasonable detail the nature of
the claim, the Indemnified Party’s best estimate of the amount of Damages
attributable to such claim and the basis of the Indemnified Party’s request for
indemnification under this Article VIII.

(e) If the Indemnifying Party does not notify the Indemnified Party within
thirty (30) days from its receipt of the Indemnity Notice that the Indemnifying
Party disputes such claim (the “Dispute Notice”), the Indemnifying Party shall
be deemed to have accepted and agreed with such claim and shall instruct the
Escrow Agent in accordance with the Escrow Agreement to pay the amount set forth
in the Indemnity Notice promptly after the expiration of such 30-day period.

(f) If the Indemnifying Party has disputed a claim for indemnification
(including any Third-Party Claim), the Indemnifying Party and the Indemnified
Party shall proceed in good faith to negotiate a resolution to such dispute. If
the Indemnifying Party and the Indemnified Party cannot resolve such dispute in
thirty (30) days after delivery of the Dispute Notice, such dispute shall be
resolved by litigation in an appropriate court of law in accordance with the
terms of this Agreement. Upon resolution of such dispute by the Parties or
receipt of a final and non-appealable order or determination from a court of
competent jurisdiction setting forth the resolution of such dispute, the
Indemnifying Party shall promptly pay the amount agreed in such resolution or so
ordered to be paid, if any.

(g) The term “Damages” as used in this Article VIII is not limited to matters
asserted by third-parties against an Indemnified Party, but includes Damages
incurred or sustained by an Indemnified Party in the absence of Third-Party
Claims. An Indemnified Party’s right to indemnification pursuant to this
Article VIII shall not be conditioned upon the payment of amounts by such
Indemnified Party.

Section 8.4. Limitation on Liability. Notwithstanding anything to the contrary
in this Agreement, to the extent any Buyer Indemnified Party is entitled to
indemnification pursuant to Section 8.2(a), (a) such Buyer Indemnified Party
shall be entitled to obtain such indemnification solely out of the then
remaining balance of the Escrow Amount, (b) the aggregate Liability of the
holders of Units and the holders of Phantom Units to the Buyer Indemnified
Parties for indemnification under Section 8.2(a) shall be limited to the then
remaining balance of the Escrow Amount, and (c) such Buyer Indemnified Party
shall not have any recourse against the Member Representative personally for
indemnification pursuant to Section 8.2(a) and (d) such Buyer Indemnified Party
shall not be entitled to indemnification to the extent such Damages were
included in the calculation of Closing Date Working Capital.

Section 8.5. Calculation of Damages.

(a) In calculating the amount of the Damages to any Indemnified Party under
Section 8.2, the amount of Damages will be net of any amounts recoverable by the
Indemnified Party from any third-party (including insurance proceeds) as a
result of the facts or circumstances giving rise to the Damages (such amounts, a
“Reimbursement”). The Indemnified Parties shall pursue payment under or from any
insurer or third-party in respect of such Damages prior to pursuing payment from
any Indemnifying Party. If any Reimbursement is obtained subsequent to payment
to an Indemnified Party in respect of any Damages, then such Reimbursement shall
be promptly paid over to the Indemnifying Party.

(b) Any payment made pursuant to the provisions of this Article VIII shall be
deemed to be and treated, to the extent permitted by Law, as an adjustment to
the Merger Consideration for all purposes.

Section 8.6. Exclusive Remedy. Except for any equitable relief to which any
Party may be entitled and except in the case of fraud or as set forth in
Section 6.7, from and after the Closing, the indemnification provisions of this
Article VIII shall be the sole and exclusive remedy with respect to any and all
claims relating to the subject matter of this Agreement and no Party shall
pursue or seek to pursue any other remedy. In furtherance of the foregoing,
Buyer and Merger Sub each hereby waives, to the fullest extent permitted under
applicable Law, any and all rights, claims and causes of action it or any of its
Subsidiaries or Affiliates (including the Surviving Company Group) may have
against the Company arising under or based upon any Law.

Section 8.7. Access. From and after the delivery of a Claim Notice or an
Indemnity Notice by any Indemnified Party, each Indemnified Party shall grant
the Indemnifying Party and its representatives all reasonable access to the
books, records, employees and properties of such Indemnified Party (including
the members of the Company Group) related to the matters to which the claim
relates (provided that, as necessary to protect any attorney-client privilege,
the Indemnified Party and each Indemnified Party shall execute a joint defense
agreement containing customary terms). All such access shall be granted during
normal business hours.

Section 8.8. Mitigation of Damages. The Parties shall cooperate with each other
to mitigate any Damages.

Section 8.9. Certain Damages. EXCEPT IN THE CASE OF THIRD-PARTY CLAIMS, IN NO
EVENT SHALL THE INDEMNIFICATION OBLIGATIONS UNDER THIS AGREEMENT (INCLUDING
UNDER THIS ARTICLE VIII) OR THE TERM “DAMAGES” COVER OR INCLUDE PUNITIVE DAMAGES
OR LOST PROFITS, WHETHER BASED ON STATUTE, CONTRACT, TORT OR OTHERWISE, AND
WHETHER OR NOT ARISING FROM THE INDEMNIFYING PARTY’S SOLE, JOINT OR CONCURRENT
NEGLIGENCE, STRICT LIABILITY OR OTHER FAULT.

Section 8.10. Release of Escrow Amount. On the Survival Date the Escrow Agent
shall release to the Member Representative for distribution to the holders of
Units (other than Preferred Units) and the holders of Phantom Units (other than
Preferred Phantom Units) all or any remaining portion of the Escrow Amount
(including any interest thereon), less (a) first, the amount of any Member
Allocable Expenses submitted to the Escrow Agent on or prior to such date and
payable to the Member Representative in accordance with Section 3.2 and the
Escrow Agreement, and then less (b) second, an amount equal to the aggregate
amount of all claims for indemnification of the Buyer Indemnified Parties which
are properly asserted and pending on or prior to such date. Promptly upon the
resolution of a pending claim for indemnification related to clause (b) of this
Section 8.10, the Escrow Agent shall release to the Member Representative for
distribution to holders of Units (other than Preferred Units) and the holders of
Phantom Units (other than Preferred Phantom Units) any Escrow Amount (including
any interest thereon) retained in respect of such pending claim for
indemnification remaining after the resolution of such pending claim, less the
amount of any Member Allocable Expenses submitted to the Escrow Agent on or
prior to such date and payable to the Member Representative in accordance with
Section 3.2 and the Escrow Agreement. Any distribution pursuant to this
Section 8.10 shall be made to each holder of Units (other than Preferred Units)
and each holder of Phantom Units (other than Preferred Phantom Units) pro rata
in accordance with such holder’s Applicable Percentage and shall otherwise be
made in accordance with this Agreement and the Escrow Agreement.

ARTICLE IX.

MEMBER REPRESENTATIVE

Section 9.1. Member Representative. The Parties have agreed that it is desirable
to designate Satow Associates, LLC to act on behalf of the holders of Units and
the holders of Phantom Units for certain limited purposes, as specified herein
(the “Member Representative”).

Section 9.2. Authority and Rights. By the Members’ approval of this Agreement
and further each holder of Units and each holder of Phantom Units’ submission of
a letter of transmittal pursuant hereto, each of the holders of Units and the
holders of Phantom Units of the Company immediately prior to the Effective Time
irrevocably ratifies the designation of Satow Associates, LLC (or any successor
representative) as Member Representative as provided in this Agreement. The
Member Representative shall have such powers and authority to take any and all
actions specified in or contemplated by this Agreement, the Escrow Agreement and
the other Transaction Documents for and on behalf of the holders of Units and
the holders of Phantom Units, as fully as such holders were acting on their own
behalf, and take all actions necessary or appropriate in the judgment of Member
Representative for the accomplishment of the foregoing; provided, however, that
the Member Representative will have no obligation to act on behalf of the
holders of Units or Phantom Units, except as expressly provided herein or
therein. Without limiting the generality of the foregoing, the Member
Representative shall have full power, authority and discretion to estimate and
determine the amounts of Member Allocable Expenses, and to direct the Escrow
Agent to pay such Member Allocable Expenses in accordance with Sections 3.2 and
8.10 hereof. The Member Representative will at all times be entitled to rely on
any directions received from the holders of Units or Phantom Units; provided,
however, that the Member Representative shall not be required to follow any such
direction, and shall be under no obligation to take any action in its capacity
as Member Representative, unless the Member Representative is entitled to funds
under Sections 3.2 and 8.10 of this Agreement and/or has been provided with
other funds, security or indemnities which, in the sole discretion of the Member
Representative, are sufficient to protect the Member Representative against the
costs, expenses and Liabilities which may be incurred by the Member
Representative in responding to such direction or taking such action. The Member
Representative shall be entitled to engage such counsel, experts and other
agents and consultants as it shall deem necessary in connection with exercising
its powers and performing its function hereunder and (in the absence of bad
faith on the part of the Member Representative) shall be entitled to
conclusively rely on the opinions and advice of such Persons. The Member
Representative shall be entitled to reimbursement from the Escrow Amount as set
forth in Sections 3.2 and 8.10 of this Agreement and/or from funds otherwise
received by it in its capacity as Member Representative pursuant to or in
connection with this Agreement, for all reasonable expenses, disbursements and
advances (including fees and disbursements of its counsel, experts and other
agents and consultants) incurred by the Member Representative in such capacity,
and for indemnification against any loss, Liability or expenses arising out of
actions taken or omitted to be taken in its capacity as Member Representative
(except for those arising out of the Member Representative’s gross negligence or
willful misconduct), including the costs and expenses of investigation and
defense of claims for indemnification. All actions taken by Member
Representative under this Agreement, including but not limited to, actions
following the Closing Date with respect to all matters relating to Section 3.2
and Article VIII hereof and to the Escrow Agreement, shall be binding upon all
holders of Units and all holders of Phantom Units and their successors as if
expressly confirmed and ratified in writing by each of them. Buyer, Merger Sub,
the Escrow Agent, and, after the Closing Date, the Buyer Indemnified Parties
shall be entitled to serve notice to, and deal exclusively with, the Member
Representative with respect to any and all matters concerning any of the holders
of Units or Phantom Units arising out of or related to this Agreement or the
Transaction Documents (except as may otherwise expressly be set forth in such
Transaction Documents) or the transactions contemplated hereby or thereby and
shall be entitled to rely conclusively (without further evidence of any kind
whatsoever) on any document executed or purported to be executed on behalf of
any holder of Units, holder of Phantom Units or Indemnifying Party by the Member
Representative with respect thereto, and on any other action taken or purported
to be taken on behalf of any holder of Units, holder of Phantom Units or
Indemnifying Party by the Member Representative with respect thereto, as fully
binding upon such holder of Units, holder of Phantom Units or Indemnifying
Party. If the Member Representative shall resign, dissolve, cease to exist or
otherwise be unable to fulfill its responsibilities as representative of the
holders of Units and the holders of Phantom Units, the holders of Units and the
holders of Phantom Units shall, within ten (10) days after the occurrence of
such event, appoint a successor representative and, promptly thereafter, shall
notify Buyer and the Escrow Agent of the identity of such successor. Any such
successor shall become the “Member Representative” for purposes of this
Agreement and the other Transaction Documents. If for any reason there is no
Member Representative at any time, all references herein or in any other
Transaction Document to the Member Representative shall be deemed to refer to
the holders of Units and the holders of Phantom Units.

Section 9.3. Limitations on Liability. Except in cases of willful misconduct or
fraud and except as set forth in Section 3.3(a), the Member Representative will
have no Liability to the holders of Units and the holders of Phantom Units or
their successors or assigns with respect to actions taken or omitted to be taken
in its capacity as Member Representative and shall be entitled to
indemnification and reimbursement from the holders of Units and the holders of
Phantom Units (whether from the Escrow Amount or otherwise) against any loss,
Liability, fees or expenses arising out of actions taken or omitted to be taken
in its capacity as Member Representative.

ARTICLE X.

TERMINATION

Section 10.1. Termination Events. Without prejudice to other remedies which may
be available to the Parties by Law or this Agreement, this Agreement may be
terminated and the transactions contemplated hereby may be abandoned at any time
prior to the Closing:

(a) by mutual written consent of the Member Representative and Buyer;

(b) by either the Member Representative or Buyer by giving written notice to the
other Party if the Closing shall not have occurred by October 9, 2007, unless
extended by written agreement of the Member Representative and Buyer; provided
that the Party seeking termination pursuant to this subsection (b) is not in
default or breach of any Transaction Document to which it is party and provided,
further, that the right to terminate this Agreement under this subsection
(b) 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
Closing to occur on or before such date; or

(c) by either the Member Representative or Buyer by giving written notice to the
other Party if any Governmental Authority shall have issued an order, decree or
ruling or taken any other action permanently restraining, enjoining or otherwise
prohibiting the consummation of any of the transactions contemplated by this
Agreement, and such order, decree, ruling or other Action shall not be subject
to appeal or shall have become final and non-appealable.

Section 10.2. Effect of Termination. In the event of any termination of this
Agreement pursuant to Section 10.1, all rights and obligations of the Parties
hereunder shall terminate without any Liability on the part of any Party or its
Affiliates in respect thereof, except that (a) the obligations of the Parties
under Section 6.2 (Access to Information; Confidentiality), Section 6.5 (Public
Announcements) and Article VIII of this Agreement shall remain in full force and
effect and (b) such termination shall not relieve any Party of any Liability for
any breach prior to termination of this Agreement.

ARTICLE XI.

MISCELLANEOUS

Section 11.1. Parties in Interest. Except as provided in Section 6.7 with
respect to the rights of the Indemnified Officers and in Article VIII with
respect to the rights of the holders of Units and the holders of Phantom Units
to receive indemnification hereunder, nothing in this Agreement, whether express
or implied, shall be construed to give any Person, other than the Parties or
their respective successors and permitted assigns, any legal or equitable right,
remedy, claim or benefit under or in respect of this Agreement.

Section 11.2. Assignment. This Agreement shall be binding upon and inure to the
benefit of the Parties and their respective successors and permitted assigns. No
Party may assign (by contract, stock sale, operation of Law or otherwise) either
this Agreement or any of its rights, interests or obligations hereunder without
the express prior written consent of the other Parties, and any attempted
assignment, without such consent, shall be null and void.

Section 11.3. Notices. All notices and other communications required or
permitted to be given by any provision of this Agreement shall be in writing and
mailed (certified or registered mail, postage prepaid, return receipt requested)
or sent by hand or overnight courier, or by facsimile transmission (with
acknowledgment received), charges prepaid and addressed to the intended
recipient as follows, or to such other addresses or numbers as may be specified
by a Party from time to time by like notice to the other Parties:

      If to the Company:

JDS Pharmaceuticals, LLC
405 Lexington Avenue, 59th Floor
New York, NY 10174
Attention: Michael Satow
Facsimile: (212) 214-0948

      with copies to:

Latham & Watkins LLP
885 Third Avenue
New York, New York 10022
Attention: Barry A. Bryer and Eric Schwartzman
Facsimile: (212) 751-4864

      If to the Member Representative:

Satow Associates, LLC
158 Mercer Street
New York, NY 10012
Attention: Phillip M. Satow
Facsimile: (914) 238-0108

      with copy to:

Latham & Watkins LLP
885 Third Avenue
New York, New York 10022
Attention: Barry A. Bryer and Eric Schwartzman
Facsimile: (212) 751-4864

      If to Buyer:

Noven Pharmaceuticals, Inc.

11960 SW 144th Street

Miami, Florida 33186

Attention: General Counsel

Facsimile: (305) 232-1836

      with a copy to:

Cravath, Swaine & Moore LLP

825 8th Avenue

New York, New York 10019

Attention: Richard Hall

Facsimile: (212) 474-3700

      If to Merger Sub:

c/o Noven Pharmaceuticals, Inc.

11960 SW 144th Street

Miami, Florida 33186

Attention: General Counsel

Facsimile: (305) 232-1836

      with a copy to:

Cravath, Swaine & Moore LLP

825 8th Avenue

New York, New York 10019

Attention: Richard Hall

Facsimile: (212) 474-3700

All notices and other communications given in accordance with the provisions of
this Agreement shall be deemed to have been given and received when delivered by
hand or transmitted by facsimile (with acknowledgment received), three
(3) Business Days after the same are sent by certified or registered mail,
postage prepaid, return receipt requested or one (1) Business Day after the same
are sent by a reliable overnight courier service, with acknowledgment of
receipt.

Section 11.4. Amendments and Waivers. This Agreement may not be amended,
supplemented or otherwise modified except in a written instrument executed by
each of the Parties. No waiver by any of the Parties of any default,
misrepresentation or breach of warranty or covenant hereunder, whether
intentional or not, shall be deemed to extend to any prior or subsequent
default, misrepresentation or breach of warranty or covenant hereunder or affect
in any way any rights arising by virtue of any prior or subsequent such
occurrence. No waiver by any of the Parties of any of the provisions hereof
shall be effective unless explicitly set forth in writing and executed by the
Party sought to be charged with such waiver.

Section 11.5. Exhibits and Disclosure Schedule.

(a) All Exhibits, Schedules and the Disclosure Schedule attached hereto are
hereby incorporated herein by reference and made a part hereof. Any matter
disclosed pursuant to any Section of or Schedule or Exhibit to this Agreement or
the Disclosure Schedule (or any section of any Schedule or Exhibit to this
Agreement or the Disclosure Schedule) whose relevance or applicability to any
representation or warranty made elsewhere in this Agreement or to the
information called for by any other Section of or Schedule or Exhibit to this
Agreement or the Disclosure Schedule (or any other section of any Schedule or
Exhibit to this Agreement or the Disclosure Schedule) is reasonably apparent on
its face shall be deemed to be an exception to such representations and
warranties and to be disclosed with respect to all Sections of and Schedules and
Exhibits to this Agreement and the Disclosure Schedule (and all sections of all
Schedules and Exhibits to this Agreement and the Disclosure Schedule),
notwithstanding the omission of a reference or cross-reference thereto;
provided, however, that the provisions of this Section 11.5(a) shall not apply
to, or have any effect on, the representations and warranties made in
Sections 4.1 through 4.8 or any Section of or Schedule or Exhibit to this
Agreement or the Disclosure Schedule (or any section of any Schedule or Exhibit
to this Agreement or the Disclosure Schedule) related thereto.

(b) Neither the specification of any dollar amount in any representation or
warranty nor the mere inclusion of any item in a Schedule or in the Disclosure
Schedule as an exception to a representation or warranty shall be deemed an
admission by a Party that such item represents an exception or material fact,
event or circumstance or that such item would be reasonably likely to,
individually or in the aggregate, result in a Material Adverse Effect on the
Company Group, Buyer or Merger Sub.

Section 11.6. Headings. The table of contents and section headings contained in
this Agreement are for reference purposes only and shall not be deemed a part of
this Agreement or affect in any way the meaning or interpretation of this
Agreement.

Section 11.7. Construction. The Parties have participated jointly in the
negotiation and drafting of this Agreement. In the event an ambiguity or
question of intent or interpretation arises, this Agreement shall be construed
as if drafted jointly by the Parties and no presumption or burden of proof shall
arise favoring or disfavoring any Party by virtue of the authorship of any of
the provisions of this Agreement.

Section 11.8. No Other Representations or Warranties. Except for the
representations and warranties expressly set forth in this Agreement, Buyer and
Merger Sub acknowledge that none of the Company or any of its Affiliates nor any
other Person makes any representation or warranty, express or implied, at law or
in equity, with respect to the Company Group and its Affiliates, the Units, the
Phantom Units or any of the assets or Liabilities of the Company Group and its
Affiliates, or with respect to any other information provided to Buyer or Merger
Sub, whether on behalf of the Company Group or such other Persons, including as
to the probable success or profitability of the Company Group after the Closing.
No holder of Units or Phantom Units or any other Person will have or be subject
to any Liability to Buyer or any other Person resulting from the distribution to
Buyer or Merger Sub, or Buyer or Merger Sub’s use of, any such information,
including any information, document or material made available to Buyer or
Merger Sub in certain “data rooms,” management presentations or in any other
form in expectation or contemplation of the transactions contemplated by this
Agreement.

Section 11.9. Entire Agreement. This Agreement (including the Disclosure
Schedule and the Exhibits hereto), the Transaction Documents and the
Confidentiality Agreement constitute the entire agreement among the Parties with
respect to the subject matter hereof and thereof and supersede any prior
understandings, negotiations, agreements, discussions or representations among
the Parties of any nature, whether written or oral, to the extent they relate in
any way to the subject matter hereof or thereof.

Section 11.10. Severability. If any provision of this Agreement or the
application of any such provision to any Person or circumstance shall be
declared by any court of competent jurisdiction to be invalid, illegal, void or
unenforceable in any respect, all other provisions of this Agreement, or the
application of such provision to Persons or circumstances other than those as to
which it has been held invalid, illegal, void or unenforceable, shall
nevertheless remain in full force and effect and will in no way be affected,
impaired or invalidated thereby. Upon such determination that any provision, or
the application of any such provision, is invalid, illegal, void or
unenforceable, the Parties shall negotiate in good faith to modify this
Agreement so as to effect the original intent of the Parties as closely as
possible to the fullest extent permitted by applicable Law in an acceptable
manner to the end that the transactions contemplated hereby are fulfilled to the
greatest extent possible.

Section 11.11. Expenses. Unless otherwise provided herein, each Party agrees to
pay, without right of reimbursement from the other Parties, all costs and
expenses incurred by it incident to the performance of its obligations
hereunder, including, without limitation, the fees and disbursements of counsel,
accountants, financial advisors, experts and consultants employed by it in
connection with the transactions contemplated hereby, whether or not the
transactions contemplated by this Agreement are consummated.

Section 11.12. Governing Law. This Agreement and all claims arising out of or
relating to this Agreement and the transactions contemplated hereby shall be
governed by the Laws of the State of Delaware, without regard to the conflicts
of law principles that would result in the application of any Law other than the
Law of the State of Delaware.

Section 11.13. Consent to Jurisdiction; Waiver of Jury Trial.

(a) Each of the Parties irrevocably submits to the exclusive jurisdiction of
(i) state courts of the State of Delaware and (ii) the United States District
Court for the District of Delaware for the purposes of any suit, Action or other
proceeding arising out of or relating to this Agreement or any transaction
contemplated hereby (and agrees not to commence any Action, suit or proceeding
relating hereto except in such courts). Each of the Parties further agrees that
service of any process, summons, notice or document hand delivered or sent by
U.S. registered mail to such Party’s respective address set forth in
Section 11.3 will be effective service of process for any Action, suit or
proceeding in Delaware with respect to any matters to which it has submitted to
jurisdiction as set forth in the immediately preceding sentence. Each of the
Parties irrevocably and unconditionally waives any objection to the laying of
venue of any Action, suit or proceeding arising out of or relating to this
Agreement or the transactions contemplated hereby in (A) state courts of the
State of Delaware or (B) the United States District Court for the District of
Delaware, and hereby further irrevocably and unconditionally waives and agrees
not to plead or claim in any such court that any such Action, suit or proceeding
brought in any such court has been brought in an inconvenient forum.
Notwithstanding the foregoing, each Party agrees that a final judgment in any
Action or proceeding so brought shall be conclusive and may be enforced by suit
on the judgment in any jurisdiction or in any other manner provided in law or in
equity.

(b) EACH OF THE PARTIES IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY
ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR
OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE TRANSACTIONS
CONTEMPLATED BY THIS AGREEMENT OR THE ACTIONS OF THE PARTIES IN THE NEGOTIATION,
ADMINISTRATION, PERFORMANCE OR ENFORCEMENT HEREOF.

Section 11.14. Equitable Remedies. Each of the Parties acknowledges and agrees
that the other Party would be irreparably damaged in the event that any of the
terms or provisions of this Agreement are not performed in accordance with their
specific terms or otherwise are breached. Therefore, notwithstanding anything to
the contrary set forth in this Agreement, each of the Parties hereby agrees that
the other Party shall be entitled to an Injunction or Injunctions to prevent
breaches of any of the terms or provisions of this Agreement, and to enforce
specifically the performance by such first Party under this Agreement, and each
Party hereby agrees to waive the defense in any such suit that the other Party
have an adequate remedy at law and to interpose no opposition, legal or
otherwise, as to the propriety of Injunction or specific performance as a
remedy, and hereby agrees to waive any requirement to post any bond in
connection with obtaining such relief. The equitable remedies described in this
Section 11.14 shall be in addition to, and not in lieu of, any other remedies at
law or in equity that the Parties may elect to pursue. The Parties hereby agree
that irreparable damage would occur in the event any of the terms or provisions
of this Agreement required to be performed prior to the Closing are not
performed in accordance with the terms of this Agreement and that, prior to the
Closing, the Parties shall be entitled to specific performance of the terms of
this Agreement, in addition to any other remedy at law or in equity.

Section 11.15. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original but all of which
together will constitute one and the same instrument.

• * * * *

3 IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be
executed as of the date first above written.

JDS PHARMACEUTICALS, LLC

    By: /s/ Phillip M. Satow

Name: Phillip M. Satow
Title: Chairman and Chief Executive Officer

SATOW ASSOCIATES, LLC, solely in its capacity as Member Representative

    By: /s/ Michael S. Satow

Name: Michael S. Satow
Title: Managing Member

4

NOVEN PHARMACEUTICALS, INC.

    By: /s/ Robert C. Strauss

Name: Robert C. Strauss
Title: President, Chief Executive Officer and

Chairman of the Board

NOVEN ACQUISITION, LLC

By: NOVEN BETA, LLC, as its Sole Member

By: NOVEN ALPHA, LLC, as its Sole Member

     
By:
  By: NOVEN PHARMACEUTICALS, INC., as its Sole Member
/s/ Jeff T. Mihm
 
   

Name: Jeff T. Mihm
Title: Vice President and General Counsel

5