WERE BASED ON THE
SUCCESSFUL LAUNCHES OF THOSE DRUGS.
THE FIRST AMENDED COMPLAINT SOUGHT TO
PROCEED ON BEHALF OF A CLASS CONSISTING OF ALL PERSONS WHO PURCHASED BIOVAIL
PUBLICLY TRADED COMMON STOCK DURING THE PERIOD FEBRUARY 7, 2003 THROUGH AND
INCLUDING MARCH 2, 2004, EXCLUDING CERTAIN NAMED PERSONS AND ENTITIES;
(1)
THE MARCH 9, 2004 ORDER ALSO APPOINTED A THIRD LEAD PLAINTIFF WHOSE MOTION
TO VOLUNTARILY WITHDRAW AS SUCH WAS GRANTED BY ORDER ENTERED ON APRIL 7, 2005.
C.
ON SEPTEMBER 28, 2004 DEFENDANTS MOVED TO DISMISS THE FIRST
AMENDED COMPLAINT.
THE MOTION WAS DENIED BY ORDER ENTERED DECEMBER 22, 2004.
DEFENDANTS ANSWERED THE FIRST AMENDED COMPLAINT ON FEBRUARY 4, 2005;
D.
ON FEBRUARY 28, 2006, LEAD PLAINTIFFS' FILED THEIR MOTION (I) TO
CERTIFY THE ACTION AS A CLASS ACTION, (II) TO CERTIFY LEAD PLAINTIFFS AS WELL AS
PLAINTIFF CITY OF DEARBORN HEIGHTS ACT 345 PENSION SYSTEM AS
CLASS REPRESENTATIVES, AND (III) TO CERTIFY CO-LEAD COUNSEL AS CLASS COUNSEL.
THE MOTION WAS FULLY BRIEFED AND ARGUED TO THE COURT AND WAS SUB JUDICE AT THE
TIME THE AGREEMENT IN PRINCIPLE TO SETTLE THE ACTION WAS REACHED;
E.
ON AUGUST 25, 2006, LEAD PLAINTIFFS FILED THE CONSOLIDATED SECOND
AMENDED CLASS ACTION COMPLAINT (THE "COMPLAINT") WHICH GENERALLY ALLEGES, AMONG
OTHER THINGS, THAT, IN COMMUNICATIONS IN CONNECTION WITH THE LAUNCHING AND
MARKETING OF CARDIZEM LA AND REPORTING TO THE PUBLIC ABOUT THE LAUNCH OF
CARDIZEM LA, BIOVAIL, WITH THE PARTICIPATION OF THE INDIVIDUAL DEFENDANTS ISSUED
MATERIALLY FALSE AND MISLEADING PRESS RELEASES AND OTHER STATEMENTS, INCLUDING
FINANCIAL STATEMENTS FILED WITH THE SEC, REGARDING CARDIZEM LA AND BIOVAIL'S
FINANCIAL CONDITION DURING THE CLASS PERIOD IN A SCHEME TO ARTIFICIALLY INFLATE
THE VALUE OF BIOVAIL'S COMMON STOCK;
F.
THE COMPLAINT FURTHER ALLEGES THAT LEAD PLAINTIFFS AND THE OTHER
MEMBERS OF THE CLASS PURCHASED THE COMMON STOCK OF BIOVAIL DURING THE
CLASS PERIOD AT PRICES ARTIFICIALLY INFLATED AS A RESULT OF THE DEFENDANTS'
DISSEMINATION IN COMMUNICATIONS OF MATERIALLY FALSE AND MISLEADING STATEMENTS
REGARDING BIOVAIL IN VIOLATION OF SECTIONS 10(B) AND 20(A) OF THE SECURITIES
EXCHANGE ACT OF 1934, AND RULE 10B-5 PROMULGATED THEREUNDER;
G.
ON OCTOBER 20, 2006, DEFENDANTS ANSWERED THE COMPLAINT;
H.
THE DEFENDANTS DENY ANY WRONGDOING WHATSOEVER AND THIS STIPULATION
SHALL IN NO EVENT BE CONSTRUED OR DEEMED TO BE EVIDENCE OF OR AN ADMISSION OR
CONCESSION ON THE PART OF ANY DEFENDANT WITH RESPECT TO ANY CLAIM OR OF ANY
FAULT OR LIABILITY OR WRONGDOING OR DAMAGE WHATSOEVER, OR ANY INFIRMITY IN THE
DEFENSES THAT THE DEFENDANTS HAVE ASSERTED.
THE PARTIES TO THIS STIPULATION
RECOGNIZE, HOWEVER, THAT THE LITIGATION HAS BEEN FILED BY PLAINTIFFS AND
DEFENDED BY DEFENDANTS IN GOOD FAITH AND IN COMPLIANCE WITH FEDERAL RULE OF
CIVIL PROCEDURE 11, THAT THE LITIGATION IS BEING VOLUNTARILY SETTLED AFTER
ADVICE OF COUNSEL, AND THAT THE TERMS OF THE SETTLEMENT ARE FAIR, ADEQUATE AND
REASONABLE.
THIS STIPULATION SHALL NOT BE CONSTRUED OR DEEMED TO BE A
CONCESSION BY ANY PLAINTIFF OF ANY INFIRMITY IN THE CLAIMS ASSERTED IN THE
ACTION;
I.
PLAINTIFFS'