Document:

Nuvelo, Inc. Executive Change in Control and Severance Benefit Plan

 Exhibit 10.1 
  
 NUVELO, INC. 
  
 EXECUTIVE CHANGE IN CONTROL AND SEVERANCE BENEFIT PLAN 
  
 1. INTRODUCTION 
  
 The Nuvelo, Inc. Executive Change in Control and Severance Benefit Plan (the “Plan”) is hereby established effective December 14, 2004 (the
“Effective Date”). The purpose of the Plan is to provide for the payment of severance benefits and/or change in control benefits to certain eligible employees of Nuvelo, Inc. and its wholly owned subsidiaries (collectively,
“Nuvelo”). The Plan supersedes and replaces in its entirety any change in control and/or severance arrangement adopted by Nuvelo. This Plan also is intended to supersede any unwritten severance plan, policy, or practice of Nuvelo and any
unwritten change of control plan, policy or practice of Nuvelo. However, except as provided herein, this Plan does not supersede any written agreement between Nuvelo and any employee that provides for payments or benefits in the event of termination
of employment or a change in control of Nuvelo. This Plan may, however, provide for certain offsets or reduction of benefits under this Plan on account of such other benefits. This document also is the Summary Plan Description for the Plan.

  
 2. DEFINITIONS. 
  
 For purposes of the Plan, the following terms are defined as follows:

  
 (a) “Alternative Benefits” means Covered
Benefits that are provided by a program, plan, agreement, or arrangement other than this Plan. Accordingly, for example, an “Alternative Cash Severance Benefit” means a Cash Severance Benefit that is an Alternative Benefit and an
“Alternative Continued Medical Benefit” means a Continued Medical Benefit that is an Alternative Benefit. Notwithstanding the foregoing, a benefit that is designated an Alternative Benefit in a Participant’s Participation Notice shall
be deemed to be an Alternative Benefit with respect to such Participant, and a benefit that is designated as not an Alternative Benefit in a Participant’s Participation Notice shall not be deemed to be an Alternative Benefit with respect to
such Participant. Any benefit provided to a Participant other than by this Plan which is not addressed in the Participant’s Participation Notice shall be deemed to be an Alternative Benefit if such benefit is described in the first sentence of
this Section 2(a). 
  
 (b) “Base Salary Amount”
means the greater of (i) the Participant’s base salary as determined on a monthly basis at the time of the Covered Termination multiplied by twelve (12), or (ii) the greatest amount of base salary received by the Participant in any consecutive
twelve (12) month period that occurred within the thirty-six (36) month period immediately preceding the Covered Termination. For clarity purposes, any amount that a Participant elects to have withheld from the Participant’s base salary, for
example, contributions to any current or future plan qualified under Section 401(k) of the Code or any nonqualified deferred compensation plan (collectively “Elective Deferral Plans”) shall not reduce the Participant’s Base Salary
Amount. 
  
 (c) “Base Severance Benefit” means
the Participant’s Base Salary Amount. Except as may be set forth in the Participant’s Participation Notice, in the event the Participant has received, or is entitled to and has not waived, an Alternative Cash Severance Benefit, the Base
Severance Benefit shall be reduced (but not below zero) by the amount of the Alternative Cash Severance Benefit. The Base Severance Benefit shall be paid in cash over a twelve (12) month period in accordance with Nuvelo’s normal payroll
practices. 
  
 (d) “Board” means the Board of
Directors of Nuvelo. 
  
 (e) “Bonus Amount” means
the highest level of Bonuses Received by the Participant in any consecutive eleven (11) month period that occurred within the thirty-six (36) month period immediately preceding the Covered Termination. “Bonuses Received” means any cash
bonuses paid to a Participant pursuant to a cash bonus plan or program and shall not include, for example, amounts received pursuant to restricted stock, restricted stock units, or stock appreciation rights whether or not such awards are paid or
settled in cash. 

 (f) Bonus Severance Benefit means the Participant’s Bonus Amount. Except as may be set forth
in the Participant’s Participation Notice, in the event the Participant has received, or is entitled to and has not waived, an Alternative Cash Severance Benefit, the Bonus Severance Benefit shall be reduced (but not below zero) by the amount
of the excess, if any, of Alternative Cash Severance Benefit over the Base Severance Benefit. The Bonus Severance Benefit shall be paid in cash over a twelve (12) month period in accordance with Nuvelo’s normal payroll practices. 
  
 (g) “Cash Severance Benefit” means one or more cash payments
by Nuvelo to, or on behalf of, a Participant on account of the employee’s termination of employment with Nuvelo or in lieu of severance benefits. Such payments may be paid in a lump sum or over time. The manner by which the amount of such
benefit is determined shall not affect the characterization of the benefit as a Cash Severance Benefit; provided, however, that salary, vacation pay, and bonuses that are earned but unpaid as of the date of such termination of employment and
distributions from any Elective Deferral Plans as defined in Section 2(b) shall not constitute Cash Severance Benefits. For example, payments pursuant to Section 5(b) shall constitute Cash Severance Benefits. 
  
 (h) “Change in Control” is defined as one or more of the
following events: 
  
 (i) there is consummated a sale or
other disposition of all or substantially all of the assets of Nuvelo, as determined on a consolidated basis (other than a sale to an entity where at least fifty percent (50%) of the combined voting power of the voting securities of such entity are
owned by the stockholders of Nuvelo immediately after such sale or other disposition in substantially the same proportions as their ownership of Nuvelo immediately prior to such sale or other disposition); or 
  
 (ii) there is consummated a merger, consolidation or similar
transaction involving (directly or indirectly) Nuvelo, and, immediately after the consummation of such transaction, the stockholders of Nuvelo immediately prior to the consummation of such transaction do not directly or indirectly own, immediately
after the consummation of such transaction, outstanding voting securities representing at least fifty percent (50%) of the combined outstanding voting power of the surviving entity in such transaction or at least fifty percent (50%) of the combined
outstanding voting power of the parent of the surviving entity in such transaction, in each case in substantially the same proportions as their ownership of Nuvelo immediately prior to such transaction; or 
  
 (iii) any person, entity or group (other than Nuvelo, a subsidiary or
affiliate of Nuvelo, or a Nuvelo employee benefit plan, including any trustee of such plan acting as trustee) becomes the beneficial owner, directly or indirectly, of securities of Nuvelo representing at least fifty percent (50%) of the combined
voting power of Nuvelo’s then-outstanding securities, other than by virtue of a merger, consolidation or similar transaction; or 
  
 (iv) the individuals who, at the beginning of any period of two years or less, constituted the Board of Directors of Nuvelo cease, for any reason,
to constitute at least a majority thereof, unless the election or nomination for election of each new director was approved by the vote of at least a majority of the directors then still in office who were directors at the beginning of such period.

  
 (i) “Change in Control Severance” means any
Covered Termination of a Participant that occurs during the one (1) month prior to or during the twelve (12) months after a Change in Control. 
  
 (j) “Code” means the Internal Revenue Code of 1986, as amended. 
  
 (k) “Constructive Termination” means a voluntary termination of employment by a Participant after one of
the following is undertaken without the Participant’s express written consent: 
  
 (i) the assignment to the Participant of duties or responsibilities that results in a material diminution in the Participant’s authority, duties, position, status, or responsibilities with Nuvelo as in
effect at any time during the twelve (12) month period preceding such assignment; 

 (ii) a change in reporting responsibilities, titles, or offices that is not in connection with a
promotion; 
  
 (iii) a reduction in the Participant’s
base salary; 
  
 (iv) a change in the Participant’s
business location of more than 35 miles from the business location prior to such change, except for required travel for Nuvelo’s business to an extent substantially consistent with Participant’s prior business travel obligations;

  
 (v) a material breach by Nuvelo of any provisions of
the Plan or any enforceable written agreement between Nuvelo and the Participant; or 
  
 (vi) any failure by Nuvelo to obtain assumption of the Plan by any successor to, or assignee of, Nuvelo. 
  
 Notwithstanding the foregoing, a voluntary termination shall not be deemed a Constructive Termination unless (x) the Participant provides Nuvelo with written notice (the
“Constructive Termination Notice”) that the Participant believes that an event described in this Section 2(m) has occurred, (y) the Constructive Termination Notice is given within one (1) month of the date the event occurred, and (z)
Nuvelo does not rescind or cure the conduct giving rise to the event described in this Section 2(k) within fifteen (15) days of receipt by Nuvelo of the Constructive Termination Notice, in which case the date of Constructive Termination shall be
deemed the date on which that fifteen (15) day period expires. 
  
 (l) “Continuation Period” means the twelve (12) month period from the date of the Covered Termination. 
  
 (m) “Continued Medical Benefits” means Nuvelo’s direct payment or reimbursement, in whole or in part, whether pursuant to the Plan
or otherwise, of the premium cost of medical, dental, or vision insurance coverage for the Participant or the Participant’s family members, where such premium is paid by Nuvelo after the Participant’s termination of employment with Nuvelo
and such premium covers a period extending beyond such termination of employment. For the purposes of the preceding sentence, a wholly or partially self-insured plan or arrangement maintained by Nuvelo shall be considered insurance coverage. For
example, the benefits pursuant to Sections 5(c) and 6(d) shall constitute Continued Medical Benefits. 
  
 (n) “Covered Benefits” means the following benefits: (i) Cash Severance Benefits, (ii) Continued Medical Benefits and (iii) accelerated
vesting of Nuvelo Stock Awards. 
  
 (o) “Covered
Termination” means an Involuntary Termination Without Cause or a Constructive Termination. Termination of employment of a Participant due to death or disability shall not constitute a Covered Termination unless a voluntary termination of
employment by the Participant immediately prior to the Participant’s death or disability would have qualified as a Constructive Termination. 
  
 (p) “Eligible Employee” means all executive employees at the level of Vice President of Nuvelo or above. In addition to the foregoing,
“Eligible Employee” means any other current or former employee of Nuvelo (x) who has been designated by the Board as eligible for benefits under the Plan and (y) whose highest seniority level was at least the equivalent of a Vice
President; provided, however, that the Board shall not designate more than ninety-nine (99) persons as Eligible Employees at any one time. 
  
 (q) “ERISA” means the Employee Retirement Income Security Act of 1974, as amended. 
  
 (r) “Involuntary Termination Without Cause” means an
involuntary termination of employment by Nuvelo other than for one of the following reasons: 
  
 (i) a refusal or failure to follow the lawful and reasonable directions of the Board or individual to whom the Participant reports, which refusal or failure is not cured within 30 days following delivery of
written notice of such conduct to the Participant; 

 (ii) a material failure by the Participant to perform his or her duties in a manner reasonably
satisfactory to the Board that is not cured within 30 days following delivery of written notice of such failure to the Participant; or 
  
 (iii) participation in, a conviction of, or a plea of guilty or nolo contendere to a felony or any crime involving moral turpitude, fraud,
or dishonesty that is likely to have or has had a material adverse effect on Nuvelo. 
  
 (s) “Option” means any and all options granted to a Participant by Nuvelo, in exchange for the performance of services, to acquire common stock of Nuvelo, other than any options granted to a
Participant which expressly provide that this Plan shall not apply to such option. 
  
 (t) “Participant” means an Eligible Employee who has received a Participation Notice that the employee is eligible to receive benefits pursuant to this Plan. 
  
 (u) “Participation Notice” means the latest notice delivered
by Nuvelo to an Eligible Employee informing the employee that the employee is eligible for Covered Benefits. A Participation Notice shall be in such form as may be determined by Nuvelo. Notwithstanding the foregoing, neither Nuvelo nor any successor
may amend a Participation Notice in any way that is adverse to a Participant, without the written consent of the Participant, unless (x) the amendment is made more than six (6) months prior to an applicable Covered Termination or Change in Control
and (y) the amendment does not reduce any benefits the Participant would receive under the Plan to an amount that is less than the benefits the Participant would receive if the amended Participation Notice did not address such benefit. 

 
 (v) “Plan Administrator” means the Board or any committee
duly authorized by the Board to administer the Plan. The Plan Administrator may be, but is not required to be, the Compensation Committee of the Board. The Board may at any time administer the Plan, in whole or in part, notwithstanding that the
Board has previously appointed a committee to act as the Plan Administrator. 
  
 (w) “Regular Severance” means any Covered Termination that is not a Change in Control Severance. 
  
 (x) “Stock Award” means any and all compensatory stock awards (including Options) and stock rights (including, without limitation,
restricted stock, restricted stock units and stock appreciation rights) granted to a Participant with respect to Nuvelo stock in exchange for services rendered or to be rendered to Nuvelo and which entitle the Participant to receive either common
stock of Nuvelo or some other pecuniary benefit determined by reference to Nuvelo common stock, other than any stock awards granted to a Participant which expressly provide that this Plan shall not apply to such Stock Awards. 
  
 (y) “Vested” means that the Stock Award is, in the case of
an Option, exercisable in full and, in the case of all other Stock Awards, that the Stock Award is not subject to Nuvelo’s right (whether conditional or unconditional) to reacquire the Stock Award due to forfeiture or repurchase at less than
the fair market value of the stock or Stock Award. 
  
 3.
ELIGIBILITY FOR BENEFITS. 
  
 (a) General Rules. Subject to the provisions set forth in this Section and Section 7, in the event of a Change in Control, Nuvelo will provide the change in control benefits described in Sections 4 and 5 of the
Plan to the affected Participants. Subject to the provisions set forth in this Section and Section 7, in the event of a Regular Severance, Nuvelo will provide the severance benefits described in Section 6 of the Plan to the affected Participant.

 (b) Exceptions to Benefit Entitlement. An employee who otherwise is a Participant will not receive
benefits under the Plan in any of the following circumstances, as determined by Nuvelo in its sole discretion: 
  
 (i) The employee voluntarily terminates employment with Nuvelo in order to accept employment with another entity that is controlled (directly or
indirectly) by Nuvelo or is otherwise an affiliate of Nuvelo. 
  
 (ii) The Participant does not confirm in writing that Participant shall be subject to Nuvelo’s Confidential Information Agreement. 
  
 (iii) Except as may be set forth in a Participant’s Participation Notice, the Participant shall not be entitled to receive the benefits set
forth in Sections 5(c) or 6(d) if the Participant has either (i) previously received an Alternative Continued Medical Benefit or (ii) is eligible for and has not waived an Alternative Continued Medical Benefit. 
  
 (c) Termination of Benefits. A Participant’s right to receive the
payment of benefits under this Plan shall terminate immediately if, at any time prior to, or during, the period for which Participant is receiving benefits hereunder, the Participant, without the prior written approval of Nuvelo: 
  
 (i) willfully breaches a material provision of the Participant’s
proprietary information or confidentiality agreement with Nuvelo, as referenced in Section 3(b)(ii); 
  
 (ii) encourages or solicits any of Nuvelo’s then-current employees to leave Nuvelo’s employ for any reason or interferes in any other
manner with employment relationships at the time existing between Nuvelo and its then-current employees; 
  
 (iii) induces any of Nuvelo’s then-current clients, customers, suppliers, vendors, distributors, licensors, licensees, or other third parties
to terminate their existing business relationship with Nuvelo or interferes in any other manner with any existing business relationship between Nuvelo and any then-current client, customer, supplier, vendor, distributor, licensor, licensee or other
third party. 
  
 4. CHANGE IN
CONTROL STOCK AWARD VESTING BENEFITS 
  
 Effective upon a Change in Control, a Participant shall receive the following benefits associated with any Stock Awards which remain outstanding as of the
effective date of the Change in Control: 
  
 (a) Change in
Control Vesting Benefit. If the Participant is still employed on the effective date of the Change in Control, to the extent the Participant holds any Stock Award that is not fully Vested, one hundred percent (100%) of each Stock Award shall
immediately become Vested. 
  
 (b) Vesting Benefit for Covered
Termination Preceding Change in Control. If the Participant is not employed on the effective date of the Change in Control but the Participant’s employment terminated pursuant to a Covered Termination during the one (1) month period ending
on the effective date of the Change in Control, the Stock Awards held by the Participant that were not Vested on the date of the Participant’s Covered Termination shall become Vested as of the effective date of the Change in Control.

  
 (c) Coordination with Outstanding Stock Awards. In the
event the provisions of this Section 4 would adversely affect a Stock Award outstanding on the date this Section 4 is adopted by Nuvelo, this Section 4 shall not apply to such Stock Award without the consent of the Participant. 

 5. CHANGE IN CONTROL SEVERANCE BENEFITS

  
 (a) Change in Control Severance Benefits. Upon a
Change in Control Severance, such Participant shall receive the benefits described in Sections 5(b) and 5(c). Any amounts paid pursuant to this Section 5 shall be subject to all income tax and employment tax withholding requirements as well as any
other applicable withholding requirements. 
  
 (b) Cash
Severance Benefits. Commencing no later than the first payroll pay date that is at least ten (10) days after a Change in Control Severance, the Participant who incurred such Change in Control Severance shall begin to receive the Base Severance
Benefit and the Bonus Severance Benefit. 
  
 (c) Continued
Medical Benefits. Provided that the Participant timely elects continued coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”), Nuvelo shall pay for the Continuation Period the portion of premiums of each
Participant’s group medical, dental, and vision coverage, including coverage for the Participant’s eligible dependents, that Nuvelo paid prior to the Change in Control Severance; provided, however, that no such premium payments (or
any other payments for medical, dental or vision coverage by Nuvelo) shall be made following the effective date of the Participant’s coverage by a medical, dental or vision insurance plan of a subsequent employer. Each Participant shall be
required to notify Nuvelo immediately if the Participant becomes covered by a medical, dental or vision insurance plan of a subsequent employer. No provision of this Plan will affect the continuation coverage rules under COBRA, except that
Nuvelo’s payment of any applicable insurance premiums during the Continuation Period will be credited as payment by the Participant for purposes of the Participant’s payment required under COBRA. Therefore, the period during which a
Participant may elect whether or not to continue Nuvelo’s group medical, dental or vision coverage under COBRA, the length of time during which COBRA continuation coverage will be made available to the Participant, and all other rights and
obligations of the Participant under COBRA will be applied in the same manner that such rules would apply in the absence of this Plan. At the conclusion of the Continuation Period, the Participant will be responsible for the entire payment of
premiums required under COBRA for the remainder, if any, of the COBRA continuation period. For purposes of this Section 5(c), applicable premiums paid by Nuvelo during the Continuation Period shall not include any amounts payable by the Participant
under a Section 125 health care reimbursement plan, which amounts, if any, are the sole responsibility of the Participant. Nuvelo’s sole obligation pursuant to this Section 5(c) is to pay the premium for any COBRA coverage during the
Continuation Period. If the Participant or his spouse or his dependents cannot remain eligible for continued COBRA coverage for the entire Continuation Period, Nuvelo shall have no obligation to provide individual medical, dental, and vision
coverage for the individual(s) who cease to be so eligible for the remainder of the Continuation Period. 
  
 6. REGULAR SEVERANCE BENEFITS. 
  
 (a) Regular Severance Benefit. Upon a Regular Severance, such Participant shall receive the benefits described in Sections 6(b) – 6(d), below.
Any amounts paid pursuant to this Section 6 shall be subject to all income tax and employment tax withholding requirements as well as any other applicable withholding requirements. 
  
 (b) Base Severance Benefit. Commencing no later than the first payroll pay date that is at least ten (10) days after
such Regular Severance, such Participant shall begin to receive from Nuvelo the Base Severance Benefit. 
  
 (c) Credit Toward Vesting Requirements. With respect to any Stock Awards that are outstanding on the date of the Change in Control, the Participant
shall be immediately credited with an additional twelve (12) months of service for the purposes of determining the portions of such Stock Awards that are Vested. 
  
 (d) Continued Medical Benefits. Such Participant shall receive the Continued Medical Benefits as set forth in Section
5(c). 

 7. LIMITATIONS ON BENEFITS 
  
 (a) Release. In order to be eligible to receive benefits under
Sections 3, 4, 5, and 6 of the Plan, a Participant (or, in the case of Participant’s death or disability that qualifies as a Covered Termination, the Participant’s legal representative) must execute, following a Covered Termination or a
Change in Control, a general waiver and release in the form generally in use by Nuvelo at the time of such Covered Termination or Change in Control and such release must become effective in accordance with its terms. Nuvelo, in its sole discretion,
may modify the form of the required release to comply with applicable federal and state law and shall determine the form of the required release. 
  
 (b) Certain Reductions and Offsets. Notwithstanding any other provision of the Plan to the contrary, a Covered Benefit payable to a Participant
under this Plan shall be reduced (but not below zero) by any Alternative Benefit to such Covered Benefit payable by Nuvelo to such individual under any other policy, plan, program or arrangement, including, without limitation, a contract between the
Participant and any entity, covering such individual. Furthermore, to the extent that any federal, state or local laws, including, without limitation, so-called “plant closing” laws or statutory severance requirements, require Nuvelo to
give advance notice or make a payment of any kind to a Participant because of that Participant’s involuntary termination due to a layoff, reduction in force, plant or facility closing, sale of business, change in control, or any other similar
event or reason, the benefits payable under this Plan shall either be reduced in an amount corresponding to the amount of such notice or severance (but not to an amount less than zero). The benefits provided under this Plan are intended to satisfy
any and all statutory obligations that may arise out of a Participant’s involuntary termination of employment for the foregoing reasons, and the Plan Administrator shall so construe and implement the terms of the Plan. 
  
 (c) Mitigation. Except as otherwise specifically provided herein, a
Participant shall not be required to mitigate damages or the amount of any payment provided under this Plan by seeking other employment or otherwise, nor shall the amount of any payment provided for under this Plan be reduced by any compensation
earned by a Participant as a result of employment by another employer or any retirement benefits received by such Participant after the date of the Participant’s termination of employment with Nuvelo. 
  
 (d) Non-Duplication of Benefits. Except as otherwise specifically
provided for herein, no Participant is eligible to receive benefits under this Plan more than one time. This Plan is designed to provide certain severance pay and change of control benefits to Participants pursuant to the terms and conditions set
forth in this Plan and any associated Participation Notice. The payments pursuant to this Plan are in addition to, and not in lieu of, any unpaid salary, bonuses or benefits to which a Participant may be entitled for the period ending with the
Participant’s Covered Termination and/or a Change in Control. 
  
 (e) Indebtedness of Participants. If a terminating employee is indebted to Nuvelo or an affiliate of Nuvelo at his or her termination date, Nuvelo reserves the right to offset any Covered Benefits under the Plan by the amount of such
indebtedness. 
  
 (f) Parachute Payments. 
  
 (i) Best-After Tax Result. If any payment or benefit a Participant
would receive, from Nuvelo or otherwise, whether or not pursuant to this Plan, in connection with a Change in Control (a “Payment”), would be subject to the excise tax imposed by Section 4999 of the Code, or any comparable federal, state,
or local excise tax (such excise taxes, together with any interest and penalties, are hereinafter collectively referred to as the “Excise Tax”), then the Participant shall be entitled to receive the Reduced Amount. The “Reduced
Amount” shall be either (x) the largest portion of the Payment that would result in no portion of the Payment being subject to the Excise Tax or (y) the largest portion, up to and including the total, of the Payment, whichever amount, after
taking into account all applicable federal, state and local employment taxes, income taxes, and the Excise Tax (all computed at the highest applicable marginal rate), results in the Participant’s receipt, on an after-tax basis, of the greater
amount of the Payment notwithstanding that all or some portion of the Payment may be subject to the Excise Tax. If a reduction in payments or benefits 

 constituting “parachute payments” is necessary so that the Payment equals the Reduced Amount, reduction shall
occur in the following order unless the Participant elects in writing a different order (provided, however, that such election shall be subject to Company approval if made on or after the date on which the event that triggers the Payment
occurs): reduction of cash payments; cancellation of accelerated vesting of stock awards; and reduction of employee benefits. In the event that acceleration of vesting of stock award compensation is to be reduced, such acceleration of vesting shall
be cancelled in the reverse order of the date of grant of the Participant’s stock awards unless the Participant elects in writing a different order for cancellation. Notwithstanding the foregoing, the Participant shall be permitted to elect to
reduce any payments or benefits constituting “parachute payments,” even if the provisions of this Section 7(f) would not otherwise require such reduction, provided that such election is made in writing prior to the date of the event that
triggers the payments or benefits (or, if made on or after such date, is approved by the Company). 
  
 (ii) Use of Third Party Expert. The accounting firm engaged by Nuvelo for the purpose of rendering general tax advice as of the day prior to the
effective date of the Change in Control shall perform the calculations required by this Section 7(f). If the accounting firm so engaged by Nuvelo is serving as accountant or auditor for the individual, entity, or group effecting the Change in
Control, Nuvelo shall appoint a nationally recognized accounting firm to make the determinations required hereunder. Nuvelo shall bear all expenses with respect to the determinations by such accounting firm required to be made hereunder. The
accounting firm engaged to make the determinations hereunder shall provide its calculations, together with detailed supporting documentation, to Nuvelo and the Participant within fifteen (15) calendar days after the date on which the
Participant’s right to a Payment is triggered (if requested at that time by Nuvelo or the Participant) or such other time as requested by Nuvelo or the Participant. If the accounting firm determines that no Excise Tax is payable with respect to
a Payment to a Participant, it shall furnish Nuvelo and the Participant with an opinion reasonably acceptable to Participant that no Excise Tax will be imposed with respect to such Payment. Any good faith determinations of the accounting firm made
hereunder shall be final, binding, and conclusive upon Nuvelo and the Participant. 
  
 8. RIGHT TO INTERPRET PLAN; AMENDMENT AND TERMINATION. 
  
 (a) Exclusive Discretion. The Plan Administrator shall have the exclusive discretion and authority to establish
rules, forms, and procedures for the administration of the Plan and to construe and interpret the Plan and to decide any and all questions of fact, interpretation, definition, computation or administration arising in connection with the operation of
the Plan, including, but not limited to, the eligibility to participate in the Plan and amount of benefits paid under the Plan. The rules, interpretations, computations, and other actions of the Plan Administrator shall be binding and conclusive on
all persons. 
  
 (b) Amendment or Termination. Nuvelo
reserves the right to amend or terminate this Plan or the benefits provided hereunder at any time; provided, however, that no such amendment or termination shall occur following a Change in Control or a Covered Termination as to any
Participant who would be adversely affected by such amendment or termination unless such Participant consents in writing to such amendment or termination. Any action amending or terminating the Plan shall be in writing and executed by a duly
authorized officer of Nuvelo. Unless otherwise required by law, no approval of the shareholders of Nuvelo shall be required for any amendment or termination including any amendment that increases the benefits provided under any Stock Award. In the
event that the adoption of this Plan results in any benefits to be received by a Participant (whether such benefit is provided hereunder or otherwise) to be subject to the “plan failure” provisions of Section 409A(a)(1) of the Code,
notwithstanding any provision of this Plan to the contrary, this Plan shall be automatically deemed reformed as follows: (x) in the event some such benefits would not be subject to Section 409A(a)(1) by virtue of not being nonqualified deferred
compensation or are benefits that would not be subject to Section 409A(a)(1) of the Code by virtue of being benefits deferred prior to January 1, 2005 (the “Grandfathered Benefits”), the Plan shall be deemed null and void to the minimum
extent necessary to preserve the maximum amount of Grandfathered Benefits, and (y) to the extent the Plan is deemed null and void pursuant to the preceding clause (x) with respect to the Cash Severance Benefits, the Plan shall be deemed to provide
the Cash Severance Benefits pursuant to terms and conditions substantially similar to this Plan except 

 that there shall be no duplication under the Plan of the Grandfathered Benefits; provided, however, that the Plan
shall also contain such terms and conditions as determined by the Board as may be reasonably necessary for the Cash Severance Benefits under the Plan to not be subject to the provisions of Section 409A(a)(1) of the Code. 
  
 9. TERMINATION OF CERTAIN
EMPLOYEE BENEFITS. 
  
 Except
as provided herein, all employee benefits other than health insurance and life insurance (such as disability and 401(k) plan coverage) terminate as of a Participant’s employment termination date (except to the extent that a conversion privilege
may be available thereunder). 
  
 10. NO IMPLIED
EMPLOYMENT CONTRACT. 
  
 The
Plan shall not be deemed (i) to give any employee or other person any right to be retained in the employ of Nuvelo or (ii) to interfere with the right of Nuvelo to discharge any employee or other person at any time, with or without cause, which
right is hereby reserved. 
  
 11. LEGAL
CONSTRUCTION. 
  
 This Plan shall be governed
by and construed under the laws of the State of California (without regard to principles of conflict of laws), except to the extent preempted by ERISA. 
  
 12. CLAIMS, INQUIRIES AND APPEALS.  
  
 (a) Applications for Benefits and Inquiries. Any application for
benefits, inquiries about the Plan or inquiries about present or future rights under the Plan must be submitted to the Plan Administrator in writing. The Plan Administrator is: 
  
 Nuvelo, Inc. 
 Attn: Senior Vice President - Human Resources 
 675 Almanor Avenue 
 Sunnyvale, CA 94085 
  
 (b) Denial of Claims. In the event that any application for benefits is denied in whole or in part, the Plan Administrator must provide the applicant with written or electronic notice of the denial of the
application, and of the applicant’s right to review the denial. Any electronic notice will comply with the regulations of the U.S. Department of Labor. The notice of denial will be set forth in a manner designed to be understood by the
applicant and will include the following: 
  
 (1) the
specific reason or reasons for the denial; 
  
 (2)
references to the specific Plan provisions upon which the denial is based; 
  
 (3) a description of any additional information or material that the Plan Administrator needs to complete the review and an explanation of why such information or material is necessary; and 
  
 (4) an explanation of the Plan’s review procedures and the time
limits applicable to such procedures, including a statement of the applicant’s right, if applicable, to bring a civil action under section 502(a) of ERISA following a denial on review of the claim, as described in Section 12(c) – (f)
below. 
  
 This notice of denial will be given to the applicant
within ninety (90) days after the Plan Administrator receives the application, unless special circumstances require an extension of time, in which case, the Plan Administrator has up to an additional ninety (90) days for processing the application.
If an extension of time for processing is required, written notice of the extension will be furnished to the applicant before the end of the initial ninety (90) day period. 

 This notice of extension will describe the special circumstances necessitating the additional time and
the date by which the Plan Administrator is to render its decision on the application. 
  
 (c) Request for a Review. Any person (or that person’s authorized representative) for whom an application for benefits is denied may appeal the denial by submitting a request for a review to the Review
Panel (defined below) within sixty (60) days after the application is denied. A request for a review shall be in writing and shall be addressed to: 
  
 Review Panel 
 Nuvelo, Inc. 
 Attn: Senior Vice President - Human Resources 
 675 Almanor Avenue 
 Sunnyvale, CA 94085 
  
 The Review Panel shall be comprised of two (2) or more persons to be appointed by Nuvelo. The applicant (or his or her representative) must submit the
appeal within sixty (60) days after the application is denied (or deemed denied). The Review Panel will give the applicant (or his or her representative) an opportunity to review pertinent documents in preparing a request for a review. 

 
 A request for review must set forth all of the grounds on which it is
based, all facts in support of the request and any other matters that the applicant feels are pertinent. The applicant (or his or her representative) shall have the opportunity to submit (or the Plan Administrator may require the applicant, or his
or her representative, to submit) written comments, documents, records, and other information relating to his or her claim. The applicant (or his or her representative) shall be provided, upon request and free of charge, reasonable access to, and
copies of, all documents, records and other information relevant to his or her claim. The review shall take into account all comments, documents, records and other information submitted by the applicant (or his or her representative) relating to the
claim, without regard to whether such information was submitted or considered in the initial benefit determination. 
  
 (d) Decision on Review. The Review Panel will act on each request for review within sixty (60) days after receipt of the request, unless special
circumstances require an extension of time (not to exceed an additional sixty (60) days), for processing the request for a review. If an extension for review is required, written notice of the extension will be furnished to the applicant within the
initial sixty (60) day period. This notice of extension will describe the special circumstances necessitating the additional time and the date by which the Review Panel is to render its decision on the review. The Review Panel will give prompt,
written or electronic notice of its decision to the applicant. Any electronic notice will comply with the regulations of the U.S. Department of Labor. In the event that the Review Panel confirms the denial of the application for benefits in whole or
in part, the notice will set forth, in a manner calculated to be understood by the applicant, the following: 
  
 (1) the specific reason or reasons for the denial; 
  
 (2) references to the specific Plan provisions upon which the denial is based; 
  
 (3) a statement that the applicant is entitled to
receive, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information relevant to his or her claim; and 
  

(4) a statement of the applicant’s right, if applicable, to bring a civil action under section 502(a) of ERISA. 

 
 (e) Rules and Procedures. The Plan Administrator and/or the Review
Panel may establish rules and procedures, consistent with the Plan and with ERISA, as necessary and appropriate in carrying out its responsibilities in reviewing benefit claims. If the applicant wishes to submit additional information in connection
with an appeal from the denial of benefits, he or she may be required to do so at his or her own expense. 

 (f) Exhaustion of Remedies. No legal action for benefits under the Plan may be brought until the
claimant (i) has submitted a written application for benefits in accordance with the procedures described by Section 12(a) above, (ii) has been notified by the Plan Administrator that the application is denied, (iii) has filed a written request for
a review of the application in accordance with the appeal procedure described in Section 12(c) above, and (iv) has been notified that the Review Panel has denied the appeal. Notwithstanding the foregoing, if the Review Panel does not respond to a
Participant’s claim or appeal within the relevant time limits specified in this Section 12, the Participant may bring legal action for benefits under the Plan pursuant to Section 502(a) of ERISA. 
  
 13. BASIS OF PAYMENTS TO
AND FROM PLAN. 
  
 All benefits under the Plan shall be paid by Nuvelo. The Plan shall be unfunded, and benefits hereunder shall be paid only from the general assets of Nuvelo. 
  
 14. OTHER PLAN INFORMATION. 
  
 (a) Employer and Plan Identification Numbers. The Employer
Identification Number assigned to Nuvelo (which is the “Plan Sponsor” as that term is used in ERISA) by the Internal Revenue Service is 36-3855489. The Plan Number assigned to the Plan by the Plan Sponsor pursuant to the instructions of
the Internal Revenue Service is 506. 
  
 (b) Ending Date for
Plan’s Fiscal Year. The date of the end of the fiscal year for the purpose of maintaining the Plan’s records is December 31. 
  
 (c) Agent for the Service of Legal Process. The agent for the service of legal process with respect to the Plan is Nuvelo, Inc., Attn: Senior Vice
President of Human Resources, ABC, ABC. 
  
 (d) Plan Sponsor
and Administrator. The “Plan Sponsor” and the “Plan Administrator” of the Plan is Nuvelo, Inc., Attn: Senior Vice President - Human Resources, 675 Almanor Avenue, Sunnyvale, CA 94085. The Plan Sponsor’s and Plan
Administrator’s telephone number is (408) 215-4000. The Plan Administrator is the named fiduciary charged with the responsibility for administering the Plan. 
  
 15. STATEMENT OF ERISA RIGHTS. 
  
 Participants in this Plan (which is a welfare benefit plan sponsored by
Nuvelo, Inc.) are entitled to certain rights and protections under ERISA. If you are an Eligible Employee, you are considered a participant in the Plan for the purposes of this Section 15 and, under ERISA, you are entitled with respect to benefits
covered by ERISA to: 
  
 Receive Information About Your Plan And Benefits

  

	 	(a)	Examine, without charge, at the Plan Administrator’s office and at other specified locations, such as worksites, all documents governing the Plan and a copy of the
latest annual report (Form 5500 Series), if applicable,1 filed by the Plan with the U.S. Department of Labor and
available at the Public Disclosure Room of the Pension and Welfare Benefit Administration; 

  

	 	(b)	Obtain, upon written request to the Plan Administrator, copies of documents governing the operation of the Plan and copies of the latest annual report (Form 5500 Series), if
applicable,2 and an updated (as necessary) Summary Plan Description. The Administrator may make a reasonable charge
for the copies; and 

  

	1	Note: the Plan, as of the date of its adoption, is not subject to the requirement of filing such an annual report. 

	2	Note: the Plan, as of the date of its adoption, is not subject to the requirement of filing such an annual report. 

	 	(c)	Receive a summary of the Plan’s annual financial report, if applicable.3 The Plan Administrator is required by law to furnish each participant with a copy of this summary annual report, if applicable. 

  
 Prudent Actions By Plan Fiduciaries 
  
 In addition to creating rights for Plan participants, ERISA imposes duties
upon the people who are responsible for the operation of the employee benefit plan. The people who operate the Plan, called “fiduciaries” of the Plan, have a duty to do so prudently and in the interest of you and other Plan participants
and beneficiaries. No one, including your employer, your union or any other person, may fire you or otherwise discriminate against you in any way to prevent you from obtaining a Plan benefit or exercising your rights under ERISA. 
  
 Enforce Your Rights 
  
 If your claim for a Plan benefit is denied or ignored, in whole or in part, you have a right to know why this was done, to
obtain copies of documents relating to the decision without charge, and to appeal any denial, all within certain time schedules. 
  
 Under ERISA, there are steps you can take to enforce the above rights. For instance, if you request a copy of Plan documents or the latest annual report
from the Plan, if applicable,4 and do not receive them within 30 days, you may file suit in a Federal court. In such
a case, the court may require the Plan Administrator to provide the materials and pay you up to $110 a day until you receive the materials, unless the materials were not sent because of reasons beyond the control of the Administrator. 
  
 If you have a claim for benefits which is denied or ignored, in whole or in
part, you may file suit in a state or Federal court. In addition, if you disagree with the Plan’s decision or lack thereof concerning the qualified status of a domestic relations order or a medical child support order, you may file suit in a
state or Federal court. 
  
 If you are discriminated against for
asserting your rights, you may seek assistance from the U.S. Department of Labor, or you may file suit in a Federal court. The court will decide who should pay court costs and legal fees. If you are successful, the court may order the person you
have sued to pay these costs and fees. If you lose, the court may order you to pay these costs and fees, for example, if it finds your claim is frivolous. 
  
 Assistance With Your Questions 
  
 If you have any questions about the Plan, you should contact the Plan Administrator. If you have any questions about this statement or about your rights
under ERISA, or if you need assistance in obtaining documents from the Plan Administrator, you should contact the nearest office of the Employee Benefits Security Administration, U.S. Department of Labor, listed in your telephone directory or the
Division of Technical Assistance and Inquiries, Employee Benefits Security Administration, U.S. Department of Labor, 200 Constitution Avenue N.W., Washington, D.C. 20210. You may also obtain certain publications about your rights and
responsibilities under ERISA by calling the publications hotline of the Employee Benefits Security Administration. 
  
 16. GENERAL PROVISIONS. 
  
 (a) Notices. Any notice, demand or request required or permitted to be given by either Nuvelo or a Participant pursuant to the terms of this Plan
shall be in writing and shall be deemed given when delivered personally or deposited in the U.S. mail, First Class with postage prepaid, and addressed to the parties, in the case of Nuvelo, at the address set forth in Section 12(a) and, in the case
of a Participant, at the address as set forth in Nuvelo’s employment file maintained for the Participant as previously furnished by the Participant or such other address as a Party may request by notifying the other in writing. 
  
 (b) Transfer and Assignment. The rights and obligations of Participant
under this Plan may not be transferred or assigned without the prior written consent of Nuvelo. This Plan shall be binding upon any surviving entity resulting from a Change in Control and upon any other person who is a successor by merger,
acquisition, consolidation or otherwise to the business formerly carried on by Nuvelo without regard to whether or not such person or entity actively assumes the obligations hereunder. 
  

	3	Note: the Plan, as of the date of its adoption, is not subject to the requirement of providing a summary annual report. 

	4	Note: the Plan, as of the date of its adoption, is not subject to the requirement of filing such an annual report. 

 (c) Waiver. Any Party’s failure to enforce any provision or provisions of this Plan shall not
in any way be construed as a waiver of any such provision or provisions, nor prevent any Party from thereafter enforcing each and every other provision of this Plan. The rights granted the Parties herein are cumulative and shall not constitute a
waiver of any Party’s right to assert all other legal remedies available to it under the circumstances. 
  
 (d) Severability. Should any provision of this Plan be declared or determined to be invalid, illegal or unenforceable, the validity, legality, and
enforceability of the remaining provisions shall not in any way be affected or impaired. 
  
 (e) Section Headings. Section headings in this Plan are included for convenience of reference only and shall not be considered part of this Plan
for any other purpose. 
  
 17. EXECUTION. 
  
 To record the adoption of the Plan as set forth herein, Nuvelo, Inc. has
caused its duly authorized officer to execute the same as of the Effective Date. 
  

			
	NUVELO, INC.
		
	 By:
	 	  

		
	 Title:Asset Purchase Agreement

 Exhibit 10.1 
  
 ASSET PURCHASE AGREEMENT 
  
 THIS ASSET PURCHASE AGREEMENT (this “Agreement”) is made the 18th day of November, 2004, by and between Genetics & IVF Institute, Inc., a Virginia corporation (the “Seller”), and Commonwealth Biotechnologies,
Inc., a Virginia corporation (the “Buyer”). 
  
 RECITALS: 
  
 WHEREAS, through its
division, Fairfax Identity Laboratories, the Seller is in the business of providing medical and scientific laboratory services (the “Business”); and 
  

WHEREAS, the Seller desires to sell, and the Buyer desires to purchase, certain assets of the Seller used in connection with the Business and to
assume certain of the liabilities and obligations of the Seller relating thereto, all upon the terms and subject to the conditions set forth herein. 
  
 AGREEMENT: 
  
 NOW, THEREFORE, in consideration of the premises and the mutual promises herein made, and in consideration of the representations, warranties, and
covenants herein contained, the Buyer and the Seller (each, a “Party” and collectively, the “Parties”) agree as follows: 
  
 ARTICLE 1 
 DEFINITIONS

  
 1.1 “Accounts Receivable” means all
claims, choses in action, debts, receivables, accounts, royalties, advances, fees, monies, and all other rights to receive monies or other property from any and all sources which: (a) are owing to the Seller; (b) solely as a result of the operation
of the Business; and (c) have not been actually received by the Seller prior to or on the Closing Date, regardless of when earned, accrued or due. 
  
 1.2 “Adverse Consequences” means all actions, suits, proceedings, hearings, investigations, charges, complaints, claims, demands,
injunctions, judgments, orders, decrees, rulings, damages (other than consequential or punitive damages), dues, penalties, fines, costs, reasonable amounts paid in settlement, liabilities, obligations, Taxes, liens, losses, expenses, and fees,
including court costs and reasonable attorneys’ fees and expenses. 
  
 1.3 “Affiliate” has the meaning set forth in Rule 12b-2 of the regulations promulgated under the Securities Exchange Act. 
  
 1.4 “Assets” has the meaning set forth in Section 2.1(a). 

 1.5 “Assignment and Assumption Agreement” has the meaning set forth in Section
2.6(a)(i). 
  
 1.6. “Assignment of Intellectual
Property” has the meaning set forth in Section 2.6(a)(iii). 
  
 1.7 “Assumed Contracts” means the contracts to be assumed by the Buyer pursuant to the terms of this Agreement, and such contracts are specifically referenced on Schedule 1.7 hereto. 
  
 1.8 “Assumed Liabilities” has the meaning set forth in
Section 2.2(a). 
  
 1.9 “Bill of Sale” has the
meaning set forth in Section 2.6(a)(ii). 
  
 1.10
“Business” has the meaning set forth in the recitals to this Agreement. 
  
 1.11 “Buyer” has the meaning set forth in the preface to this Agreement. 
  
 1.12 “Buyer Closing Documents” means the Assignment and Assumption Agreement. 
  
 1.13 “Claim Notice” has the meaning set forth in Section
8.4(e). 
  
 1.14 “Closing” has the meaning set
forth in Section 2.5. 
  
 1.15 “Closing Date” has
the meaning set forth in Section 2.5. 
  
 1.16
“Confidential Information” means any information concerning the businesses and affairs of the Seller and its Affiliates, as the case may be, that is not generally available to the public, including all proprietary information
concerning the operations of the Business. 
  
 1.17
“Deposit” has the meaning set forth in Section 2.4. 
  
 1.18 “Equipment” means all office machinery and equipment, laboratory equipment, furniture and all other items of personal property owned or leased by the Seller that specifically relate to the Business, the principal items
of which are listed on Schedule 1.18 hereto. 
  
 1.19
“Excluded Assets” has the meaning set forth in Section 2.1(b). 
  
 1.20 “Excluded Liabilities” has the meaning set forth in Section 2.2(b). 
  
 1.21 “Indemnified Party” has the meaning set forth in Section 8.4(a). 
  
 1.22 “Indemnifying Party” has the meaning set forth in Section 8.4(a). 
  

 2 

 1.23 “Intellectual Property” means rights in the following Assets owned or controlled by
the Seller that relate solely to the Business: (a) all trademarks, service marks, trade dress, logos, trade names, corporate names, slogans, internet domain names, telephone numbers, and all goodwill associated therewith, together with all
translations, adaptations, derivations, combinations, applications, registrations, and renewals relating thereto, (b) the name “Fairfax Identity Laboratories,” (c) all copyrightable works, all copyrights, and all applications,
registrations, and renewals relating thereto, (d) all customer lists, referral sources, (e) all computer software (including data and related documentation), (f) all advertising and promotional materials, (g) all other proprietary rights, and (h)
all copies and tangible embodiments of the foregoing (in whatever form or medium). 
  
 1.24 “Inventory” means all materials, supplies, inventory, merchandise, and work in progress related to the Business. 
  
 1.25 “Knowledge” means actual knowledge of the officers of the Seller listed on Schedule 1.25, and
shall include the results of any investigation conducted by such Persons prior to the Closing Date, but shall not be construed as imposing any obligation on such Persons to conduct any additional investigation. 
  
 1.26 “Ordinary Course of Business” means the Seller’s
ordinary course of business consistent with past custom and practice. 
  
 1.27 “Party” has the meaning set forth in the preface to this Agreement. 
  
 1.28 “Permitted Encumbrances” means liens for Taxes not yet due and payable. 
  
 1.29 “Person” means any natural person, legal entity,
association or other organized group of natural persons or entities, or the successors, assigns and representatives of the foregoing. 
  
 1.30 “Purchase Price” has the meaning set forth in Section 2.3. 
  
 1.31 “Schedules” has the meaning set forth in the preamble to Article 4. 
  
 1.32 “Securities Exchange Act” means the Securities Exchange
Act of 1934, as amended, and the rules and regulations promulgated thereunder. 
  
 1.33 “Security Interest” means any mortgage, pledge, lien, charge, or other security interest, other than (a) mechanic’s, materialmen’s, and similar liens, (b) liens for Taxes not yet due
and payable, and (c) other liens arising in the Ordinary Course of Business and not incurred in connection with the borrowing of money. 
  
 1.34 “Seller” has the meaning set forth in the preface to this Agreement. 
  

 3 

 1.35 “Seller’s Closing Documents” means (a) the Assignment and Assumption Agreement
and (b) the Bill of Sale. 
  
 1.36 “Tax” or
“Taxes” means all taxes, levies, duties, assessments, fees or withholdings imposed by or payable to a Taxing Authority (including, without limitation, all interest, penalties and additions to tax) with respect thereto. 

 
 1.37 “Taxing Authority” means any governmental or
regulatory organization which has the right and/or authority to impose or levy any Taxes. 
  
 1.38 “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. 
  
 1.39 “Third Party Claim”
has the meaning set forth in Section 8.4(a). 
  
 1.40
“Transfer Tax” means any sales Tax, transfer Tax, recordation Tax, conveyance Tax, use Tax, stamp Tax, stock transfer Tax or other similar Tax, including any related penalties, interest and additions thereto. 
  
 ARTICLE 2 
 PURCHASE AND SALE OF ASSETS 
  
 2.1 SALE AND PURCHASE OF ASSETS. 
  
 (a) Sale of Assets. Subject to the terms and conditions of this Agreement, at the Closing, effective as of the Closing Date, the Seller shall sell,
assign, transfer, convey and deliver to the Buyer, and the Buyer shall purchase, receive and accept from the Seller all of the assets of the Seller used in the operation of the Business, as the same shall exist on the Closing Date, other than the
Excluded Assets (collectively, the “Assets”). Without limiting the generality of the foregoing, the term “Assets” shall include the following: 
  
 (i) All Seller’s Equipment; 
  
 (ii) To the extent assignable by the Seller, all of the Seller’s rights in and to the Assumed Contracts; 
  
 (iii) To the extent assignable by the Seller, all of the Seller’s rights
in the Intellectual Property; 
  
 (iv) All of the Seller’s
books, records and files related to operations of the Business, including customer lists and referral sources. The Seller shall have access to these books, records and files after the Closing Date if needed by the Seller for any proper purpose,
including preparation of financial statements and tax returns, responding to issues raised in a tax audit, and responding to alleged malpractice claims; 
  

 4 

 (v) All Seller’s Inventory; 
  
 (vi) To the extent assignable or transferable by the Seller, all unfulfilled contracts and purchase orders for goods and
services; and 
  
 (vi) All of the goodwill of the Seller relating
to the Business. 
  
 (b) Excluded Assets. The following
assets of the Seller shall not be transferred to the Buyer (collectively, the “Excluded Assets”): 
  
 (i) All assets of the Seller that are not used in the operation of the Business prior to the Closing Date; 
  
 (ii) All contracts of the Seller other than the Assumed Contracts;

  
 (iii) All Seller’s cash, cash equivalents and/or
securities whether or not related to the Business; 
  
 (iv) All
Seller’s Accounts Receivable related to the Business, whether or not billed as of the Closing Date; 
  
 (v) All Seller’s fixtures related to the Business; and 
  
 (vi) All leasehold interests and any other interests in real estate, including, but not limited to the lease for the Seller’s facility at 3020 Javier
Road, Fairfax, Virginia 22031. 
  
 (c) Sale and Transfer of
Assets. The Seller covenants that the sale and transfer of the Assets by the Seller to the Buyer as of the Closing Date shall be made free and clear of all liabilities, Security Interests, liens, claims and encumbrances, except (i) Assumed
Liabilities; (ii) Permitted Encumbrances; and (iii) as otherwise specifically provided in this Agreement. 
  
 2.2 ASSUMPTION OF CERTAIN LIABILITIES BY THE BUYER. 
  
 (a) Assumed Liabilities. On the Closing Date, the Buyer shall assume and thereafter shall pay and perform, satisfy
and otherwise discharge only the following liabilities and obligations that arise from the Business or the Assets (collectively, the “Assumed Liabilities”): 
  
 (i) All obligations and liabilities arising or accruing under the Assumed Contracts after the Closing Date; and 

 
 (ii) All accrued vacation time of the Seller’s employees that the
Buyer chooses, in its sole and absolute discretion, to hire upon the Closing. 
  

 5 

 (b) Excluded Liabilities. Except as otherwise specifically provided in Section 2.2(a) or elsewhere
in this Agreement, the Buyer shall not assume and shall in no event be liable for any liabilities, debts or obligations, whether accrued, absolute, matured, known or unknown, liquidated or unliquidated, contingent or otherwise, including without
limitation: 
  
 (i) Any liabilities of the Seller for federal,
state, local or foreign Taxes arising in connection with the operation of the Business; 
  
 (ii) All obligations and liabilities arising or accruing under the Assumed Contracts prior to or on the Closing Date; 
  
 (iii) Any severance liabilities in favor of any employees of the Seller; 
  
 (iv) Any liabilities and obligations relating to the Excluded Assets; and 
  
 (v) Any pension liabilities or obligations to current or former employees of
the Seller. 
  
 The foregoing obligations and liabilities not assumed by the Buyer
and described in this Section 2.2(b) are hereinafter collectively called the “Excluded Liabilities.” 
  
 (c) Assumed Contract Consents. To the extent that the Seller’s rights under any Assumed Contract may not be assigned without the consent of
another Person which has not been obtained as of the Closing Date, this Agreement shall not constitute an agreement to assign the same if an attempted assignment would constitute a breach thereof or be unlawful. If any such consent shall not be
obtained or if any attempted assignment would be ineffective or would impair the Buyer’s rights under the Assets such that the Buyer would not in effect acquire the benefit of all such rights, then, the Seller, to the extent permitted by law,
shall take reasonable actions, after the Closing Date, as the Buyer’s agent, in order to obtain for the Buyer the benefits thereunder, and shall cooperate with the Buyer in any other arrangement reasonably designated by the Buyer to provide
such benefits to the Buyer. 
  
 2.3 PURCHASE PRICE. Upon the Closing, the Buyer
agrees to pay the following amounts to the Seller at the Closing (collectively, the “Purchase Price”): 
  
 (a) Four Hundred Thousand Dollars ($400,000) on the Closing Date in immediately available funds by federal funds wire or interbank transfer, to the bank
account(s) designated by the Seller in writing to the Buyer prior to the Closing; 
  
 (b) Six Hundred Thousand Dollars ($600,000) payable pursuant to the Buyer’s promissory note in the form attached hereto as Exhibit A. Such note shall (i) be secured by a letter of credit issued by Branch
Banking & Trust; (ii) not bear interest; and (iii) and be payable in equal installments on each of the first and second anniversary of the Closing Date; 
  

 6 

 (c) the Deposit; and 
  
 (d) An amount equal to the value of any work-in-process purchased by the Buyer on the Closing Date by federal funds wire or
interbank transfer in immediately available funds, to the bank account(s) designated by the Seller in writing to the Buyer prior to the Closing. The Buyer and the Seller shall mutually determine such amount prior to the Closing. 
  
 2.4 ESCROW AGREEMENT. Pursuant to the terms of that certain Escrow Agreement, dated November
18, 2004, the form of which is attached as Exhibit B hereto, the Buyer has deposited One Hundred Thousand Dollars ($100,000) subject to such agreement (the “Deposit”). 
  
 2.5 ALLOCATION AND ACKNOWLEDGMENT. The Buyer and the Seller shall cooperate in good faith to mutually agree within ninety (90) days
following the Closing Date to an allocation of the Purchase Price and the Assumed Liabilities. Any subsequent adjustments to the sum of the Purchase Price and Assumed Liabilities shall be reflected in the allocation hereunder in a manner consistent
with Section 1060 of the Internal Revenue Code of 1986, as amended, and the regulations thereunder. If an allocation is mutually agreed to, then for all Tax purposes, the Buyer and the Seller agree to report the transactions contemplated in this
Agreement in a manner consistent with the terms of this Agreement, including the allocation under this Section 2.5, and that none of them will take any position inconsistent therewith in any Tax Return, in any refund claim, in any litigation, or
otherwise. The parties acknowledge that the sale of the Assets contemplated herein is intended to be a taxable transaction to the extent governed by U.S. federal income tax law. 
  
 2.6 THE CLOSING. The closing of the transactions contemplated by this Agreement (the “Closing”) shall take place at the offices of
Kaufman & Canoles, P.C., 1051 East Cary Street, Richmond, Virginia 23219 commencing at 9:00 a.m., local time, on December 18th, 2004 or such other date as the Buyer and the Seller may mutually determine (the “Closing Date”). 
  
 2.7 DELIVERIES AT THE CLOSING. 
  
 (a) Documents to be Delivered by the Seller. At the Closing, the Seller shall deliver to the Buyer the following: 
  
 (i) An executed counterpart of the Assignment and Assumption Agreement in
the form attached hereto as Exhibit C (the “Assignment and Assumption Agreement”); 
  
 (ii) A Bill of Sale in the form attached hereto as Exhibit D (the “Bill of Sale”); 
  
 (iii) The certificates and other documents required to be delivered by the
Seller on or before the Closing Date pursuant to Section 7.1 hereof or any other provision of this Agreement; and 
  

 7 

 (iv) a corporate check in the amount of Four Thousand Five Hundred Dollars ($4,500) payable to the Buyer
which amount represents one-half of the cost of the Buyer’s letter of credit referenced in Section 2.3(b)(i). 
  
 (b) Documents to be Delivered by the Buyer. At the Closing, the Buyer shall deliver to the Seller the following: 
  
 (i) The portion of the Purchase Price required to be paid or issued at the
Closing (i.e., cash, note and letter of credit); 
  
 (ii) An
executed counterpart of the Assignment and Assumption Agreement; and 
  
 (iii) The certificates and other documents required to be delivered by the Buyer on or before the Closing Date pursuant to Section 7.2 hereof or any other provision of this Agreement. 
  
 (c) Other Actions. On the Closing Date, the Seller and the Buyer shall
take all such other steps in their reasonable control as may be necessary to fulfill the conditions to Closing set forth in Section 7.1 and 7.2 hereof. 
  
 ARTICLE 3 
 REPRESENTATIONS AND
WARRANTIES OF THE BUYER 
  
 The Buyer represents and warrants
to the Seller that the statements contained in this Article 3 are correct and complete as of the date of this Agreement. 
  
 3.1 ORGANIZATION AND AUTHORITY OF THE BUYER. The Buyer is a corporation duly organized, validly existing and in good standing under the laws of the Commonwealth of
Virginia and has all necessary corporate power and authority to enter into this Agreement and the Buyer’s Closing Documents, to carry out its obligations hereunder and thereunder and to consummate the transactions contemplated hereby and
thereby. The execution and delivery of this Agreement and the Buyer’s Closing Documents by the Buyer, the performance by the Buyer of its obligations hereunder and thereunder and the consummation by the Buyer of the transactions contemplated
hereby and thereby have been duly authorized by all requisite action on the part of the Buyer. This Agreement has been, and upon their execution the Buyer’s Closing Documents will be, duly executed and delivered by the Buyer, and (assuming due
authorization, execution and delivery by the Seller) this Agreement constitutes, and upon their execution the Buyer’s Closing Documents will constitute, legal, valid and binding obligations of the Buyer, enforceable against the Buyer in
accordance with their respective terms. 
  
 3.2 NO CONFLICT. Assuming all
filings, notifications, consents, approvals, authorizations and other actions referred to in Section 3.3 have been made or obtained, except as may result from any facts or circumstances relating solely to the Seller and/or its Affiliates, the
execution, 
  

 8 

 delivery and performance of this Agreement and the Buyer’s Closing Documents by the Buyer, do not and will not (a)
violate, conflict with or result in the breach of any provision of the Articles of Incorporation or Bylaws of the Buyer, (b) conflict with or violate any law or governmental order applicable to the Buyer or (c) conflict with, or result in any breach
of, constitute a default (or event which with the giving of notice or lapse of time, or both, would become a default) under, require any consent under, or give to others any rights of termination, amendment, acceleration, suspension, revocation or
cancellation of, or result in the creation of any encumbrance on any of the assets or properties of the Buyer pursuant to, any note, bond, mortgage or indenture, contract, agreement, lease, sublease, license, permit, franchise or other instrument or
arrangement to which the Buyer is a party or by which any of such assets or properties is bound or affected, which would have a material adverse effect on the ability of the Buyer to consummate the transactions contemplated by this Agreement or by
the Buyer’s Closing Documents. 
  
 3.3 GOVERNMENTAL CONSENTS AND APPROVALS.
The execution, delivery and performance of this Agreement and each Buyer’s Closing Document to which it is a party by the Buyer do not and will not require any consent, approval, authorization or other order of, action by, filing with, or
notification to, any governmental authority. 
  
 3.4 LITIGATION. No claim, action,
proceeding or investigation is pending or, to the Knowledge of the Buyer, threatened, which could reasonably be expected to affect the legality, validity or enforceability of this Agreement or the Buyer’s Closing Documents, or seeks to delay or
prevent the consummation of, or which would be reasonably likely to materially adversely affect the Buyer’s ability to consummate the transactions contemplated by this Agreement and the Buyer’s Closing Documents. 
  
 3.5 BROKERS. No broker, finder or investment banker is entitled to any brokerage,
finder’s or other fee or commission in connection with the transactions contemplated by this Agreement based upon arrangements made by or on behalf of the Buyer. 
  
 3.6 FINANCING. The Buyer has and will have at the Closing sufficient funds or available borrowing capacity to permit the Buyer to consummate
all the transactions contemplated hereby. 
  
 3.7 RELIANCE. In executing this
Agreement, the Buyer is not relying on any statements, presentations, representations, warranties or assurances of any kind made by the Seller, its Affiliates or any other Person, other than the representations, warranties, and other provisions
expressly set forth in this Agreement or any schedule or exhibit hereto or delivered herewith. 
  

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 ARTICLE 4 
 REPRESENTATIONS AND WARRANTIES OF THE SELLER 
  
 The Seller represents and warrants to the Buyer that the statements contained in this Article 4 are correct and complete as of the date of this Agreement, including the disclosure schedules delivered by the Seller to
the Buyer on the date hereof, which constitute a part of this Agreement (collectively, the “Schedules”). 
  
 4.1. ORGANIZATION, AUTHORITY AND QUALIFICATION OF THE SELLER. The Seller is a corporation duly organized, validly existing and in good standing under the laws of the
Commonwealth of Virginia. The Seller has all necessary corporate power and authority to enter into this Agreement and the Seller’s Closing Documents, to carry out its obligations hereunder and thereunder and to consummate the transactions
contemplated hereby and thereby. The execution and delivery of this Agreement and the Seller’s Closing Documents, the performance by Seller of their respective obligations hereunder and thereunder and the consummation by Seller and its
subsidiaries of the transactions contemplated hereby and thereby have been duly authorized by all requisite action on the part of the Seller. This Agreement has been, and upon their execution the Seller’s Closing Documents will be, duly
executed and delivered by the Seller, and (assuming due authorization, execution and delivery by Buyer) this Agreement constitutes, and upon their execution the Seller’s Closing Documents will constitute, legal, valid and binding obligations of
Seller and its subsidiaries enforceable against Seller in accordance with their respective terms. 
  
 4.2 NO CONFLICT. The execution, delivery and performance of this Agreement and the Seller’s Closing Documents by the Seller do not and will not violate, conflict with or result in the breach of any provision of
the articles of incorporation or by-laws of the Seller. 
  
 4.3 INVENTORY.
Schedule 4.3 sets forth a list of the Seller’s Inventory as of the Closing Date. 
  
 4.4 LITIGATION. There are no legal actions by or against the Seller or any of its Affliates related to or affecting any of the Assets or the Business pending before any governmental authority. Neither the Seller nor
any of its Affliates, nor any of the Assets, is subject to any governmental order that could adversely affect the Business. 
  
 4.5 ASSETS. The Assets and the Excluded Assets constitute all the properties, assets and rights forming a part of, used in or held in, and all such properties, assets and
rights as are necessary in the conduct of the Business. 
  
 4.6 LABOR ISSUES. The
Seller is not presently, nor has been in the past, a party to, or bound by, any collective bargaining agreement or union contract with respect to employees employed in connection with the Business and no collective bargaining agreement is being
negotiated with respect to employees. 
  

 10 

 4.7 BROKERS. No broker, finder or investment banker is entitled to any brokerage, finder’s or other fee or
commission in connection with the transactions contemplated by this Agreement or the Seller’s Closing Documents based upon arrangements made by or on behalf of the Seller. 
  
 4.8 EMPLOYEES. Except as noted in Schedule 4.8 hereto, there are no written or oral contracts for employment of any Seller’s
employees specifically working in the Business. 
  
 4.9 CONSENT. Anything in this
Article 4 or in any other part of this Agreement to the contrary notwithstanding, the Buyer acknowledges that the following forensic contracts, entered into by the Seller, cannot be assigned to the Buyer without the prior written consent of the
other party to the contract: contracts with the Florida Department of Law Enforcement, the Maryland State Police Crime Laboratory (P.G. County), the Michigan State (Police Crime Laboratory), the Suffolk County, New York, Crime Laboratory, and the
Puerto Rico Institute of Forensic Sciences. The Seller will cooperate with the Buyer in attempting to secure permission for assignment. However, if one or more of the other (governmental) parties does not grant permission for assignment, the Seller
shall have no financial or other obligation to the Buyer, and the Buyer shall not be relived of its obligations under this Agreement, including payment of the full Purchase Price. 
  
 ARTICLE 4A 
 REPRESENTATIONS AND WARRANTIES OF THE SELLER TO ITS KNOWLEDGE 
  
 The Seller represents and warrants to the Buyer that the statements contained in this Article 4A are, to its Knowledge and without any duty to investigate, correct and complete as of the date of this Agreement.

  
 4A.1 QUALIFICATION OF THE SELLER. The Seller is duly licensed or qualified to
do business and is in good standing in each jurisdiction in which the operation of the Business makes such licensing or qualification necessary. 
  
 4A.2 NO CONFLICT. The execution, delivery and performance of this Agreement and the Seller’s Closing Documents by the Seller do not and will not (a) conflict with or
violate (or cause an event which could reasonably be expected to have a material adverse effect as a result of) any law or governmental order applicable to the Seller or the Assets or the Business, or (b) conflict with, result in any breach of,
constitute a default (or event which with the giving of notice or lapse of time, or both, would become a default) under, require any consent under, or give to others any rights of termination, amendment, acceleration, suspension, revocation or
cancellation of, any Assumed Contract, or result in the creation of any encumbrance on any of the Assets, other than a Permitted Encumbrance. 
  
 4A.3 GOVERNMENTAL CONSENTS AND APPROVALS. The execution, delivery and performance of this Agreement and each Seller’s Closing Document by the Seller do not and will
not require any consent, approval, authorization or other order of, action by, filing with or notification to, any governmental authority. 
  

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 4A.4 INVENTORY. The Seller has good and marketable title to the Inventory, free and clear of all encumbrances, other than
Permitted Encumbrances. 
  
 4A.5 EQUIPMENT. The Equipment is in good operating
condition, reasonable wear and tear in ordinary usage excepted. 
  
 4A.6
LITIGATION. No governmental authority has threatened any legal action against the Seller or any of its Affiliates related to or affecting any of the Assets or the Business. There are no governmental orders threatened to be imposed by any
governmental authority on the Seller, any of its Affaires or any of the Assets. 
  
 4A.7 COMPLIANCE WITH LAWS. The Seller has conducted and continues to conduct the Business in accordance with all laws and governmental orders applicable to the Seller, the Assets and the Business. 
  
 4A.8 ASSUMED CONTRACTS. Each Assumed Contract (i) is legal, valid and binding on the
respective parties thereto and is in full force and effect, (ii) except as noted on Schedule 4A.8, is freely and fully assignable to the Buyer without penalty or other adverse consequences and (iii) upon consummation of the transactions
contemplated by this Agreement and the Seller’s Closing Documents shall continue in full force and effect without penalty or other adverse consequence. The Seller is not in breach of, or default under, any Assumed Contract nor, to the Knowledge
of the Seller, is any third party in breach of, or default under, any Assumed Contract. 
  
 4A.9 ASSETS. 
  
 (a) The Seller has good and marketable
title to, or in the case of licensed property have a valid license to, all of the Assets, as the case may be. None of such Assets is subject to any encumbrances, other than Permitted encumbrances. 
  
 (b) The Seller has complete and unrestricted power and unqualified right to
sell, assign, transfer, convey and deliver the Assets to the Buyer. At Closing, the Seller will have transferred to the Buyer good, valid and marketable title, or to the extent applicable all right and interest, to and in each of its respective
Assets, free and clear of any encumbrances, other than Permitted Encumbrances, and without causing the Buyer to incur any penalty or other adverse consequence. 
  

4A.10 LABOR ISSUES. No work stoppage or labor strike against the Seller is pending or threatened by any of its employees employed in connection with the Business. The
Seller is not threatened with any labor dispute, grievance, or litigation relating to labor, safety or discrimination matters involving any employee, including charges of unfair labor practices or discrimination complaints. The Seller has not
engaged in any unfair labor practices within the meaning of the National Labor Relations Act which would, individually or in the aggregate, directly or indirectly result in a liability to the Buyer. 
  

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 4A.11 TAXES. 
  
 (a) (i) The Seller has filed or caused to be filed all Tax Returns of the Seller which have become due (taking into account valid extensions of time to
file) prior to the date hereof, such returns are accurate and complete in all material respects and the Seller has paid or caused to be paid all Taxes whether or not shown to be due on such returns, in each case to the extent the Buyer or any
Affiliate of the Buyer would incur liability for the Seller’s failure to file such returns or pay such Taxes, (ii) there are no outstanding tax liens that have been filed by any Tax Authority against any property or assets of the Business
(other than for Taxes not yet due and payable), and (iii) no claims are being asserted in writing with respect to any Taxes relating to the Business for which the Buyer reasonably could be held liable and the Seller knows of no basis for the
assertion of any such claim. 
  
 (b) There are no outstanding
waivers or agreements extending the statute of limitations for any period with respect to any Tax to which Buyer or the Business may be subject following the Closing. 
  
 4A.12 FULL DISCLOSURE. No representation or warranty of the Seller in this Agreement, nor any statement or certificate furnished or to be
furnished to the Buyer pursuant to this Agreement, or in connection with the transactions contemplated by this Agreement, contains or will contain any untrue statement of a material fact, or omits or will omit to state a material fact necessary to
make the statements contained herein or therein not misleading. 
  
 ARTICLE 5 
 PRE-CLOSING COVENANTS 
  
 The Parties agree as follows with respect to the period between the execution of this Agreement and the earlier of the
Termination of this Agreement or the Closing: 
  
 5.1 GENERAL. Each of the
Parties will use their reasonable best efforts to take all action and to do all things necessary, proper, or advisable in order to consummate and make effective the transactions contemplated by this Agreement (including satisfaction, but not waiver,
of the closing conditions set forth in Article 7). 
  
 5.2 NOTICES AND CONSENTS.
The Seller shall give any notices to third parties, and will use its reasonable best efforts to obtain any third party consents that the Buyer reasonably may request. Each of the Parties will give any notices to, make any filings with, and use their
reasonable best efforts to obtain any authorizations, consents, and approvals of governments and governmental agencies to complete the transactions contemplated hereby. 
  

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 5.3 OPERATION OF BUSINESS. The Seller will not engage in any practice, take any action, or enter into any transaction
outside the Ordinary Course of Business. 
  
 5.4 PRESERVATION OF BUSINESS. The
Seller will use reasonable commercial efforts to keep the Business and its properties substantially intact, including its present operations, physical facilities, working conditions, and relationships with lessors, licensors, suppliers, customers,
and employees. 
  
 5.5 FULL ACCESS. The Seller will permit representatives
of the Buyer to have full access at all reasonable times, upon two business days notice and in a manner so as not to interfere with the normal business operations of the Seller, to all premises, properties, personnel, books, records, contracts, and
documents of Seller relating to the Business or the Assets; provided, however, that Seller shall have no obligation to disclose or make available to Buyer any books, records, documents or other Confidential Information which discloses or contains
information unrelated to the Business or the Assets. The Buyer will maintain the confidentiality of any Confidential Information it receives from the Seller in the course of the reviews contemplated by this Section 5.5. 
  
 5.6 NOTICE OF DEVELOPMENTS. The Seller will give prompt written notice to the Buyer of any
material adverse development causing a breach of any representations and warranties in Article 4 and/or Article 4A. The Buyer will give prompt written notice to the Seller of any material adverse development causing a breach of any of the
Buyer’s representations and warranties in Article 3. 
  
 5.7 COOPERATION
RELATED TO CONTRACT ASSIGNMENTS. The Seller shall promptly request and use its reasonable efforts to provide proper notice and/or actively assist the Buyer in connection with obtaining consent to the assignment to the Buyer of the Assumed Contracts
requiring consent. 
  
 5.8 COOPERATION RELATED TO EMPLOYEES. The Seller shall use
its reasonable efforts to provide the Buyer with access to the employees of the Seller that are involved in the day-to-day operation of the Business to enable the Buyer to determine which, if any, of such employees, the Buyer wish to employ.

  
 ARTICLE 6 
 POST-CLOSING COVENANTS 
  
 The Parties agree as follows with respect to the period following the Closing: 
  
 6.1 GENERAL. In case at any time after the Closing, any further action is necessary to carry out the purposes of this Agreement, each of the
Parties will take such further action (including the execution and delivery of such further instruments and documents) as the other Party reasonably may request, all at the sole cost and expense of the requesting Party (unless the requesting Party
is entitled to indemnification therefor under Article 8). 
  

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 6.2 COVENANT NOT TO COMPETE. 
  
 (a) In partial consideration of the payment of the Purchase Price, the Seller covenants and agrees that for a period of three (3) years following the
Closing Date, none of Seller or any of its Affiliates shall, directly or indirectly, (i) engage in, carry on, manage, operate, perform or control the management or operation of the Restricted Business in any portion of the territory consisting of
the United States (the “Restricted Territory”), or (ii) own any equity interest in any Person that is engaged in, carries on, manages, operates, performs or controls the management or operations of any Restricted Business in the Restricted
Territory. 
  
 (b) For purposes of this Section 6.2, the term
“Restricted Business” means paternity or forensic test analyses. 
  
 (c) Notwithstanding Section 6.2(a), it will not constitute a breach of this Section 6.2 for the Seller or its Affiliates to: (i) acquire (including through a merger other corporate transaction), invest in or own
equity interests in any Person engaged in, carrying on, managing, operating, performing or controlling the management or operation of a Restricted Business, so long as (1) Seller and its Affiliates do not own, directly or indirectly, in the
aggregate in excess of 5% of the outstanding equity interests of such Person, and (2) none of Seller or any of its Affiliates, directly or indirectly, manages, operates or controls the management or operation of such Person or any Restricted
Business of such Person. 
  
 (d) The Buyer and the Seller
acknowledge and agree that compliance with the covenants contained in this Section 6.2 is necessary to protect the Buyer and that a breach of any such covenant would result in irreparable and continuing damage for which there would be no adequate
remedy at law. The Seller agrees that in the event of any breach of such covenant, the Buyer shall be entitled to preliminary and permanent injunctive relief and to such other and further relief as is proper under the circumstances without the
posting of any bond by the Buyer. If any court of competent jurisdiction determines any of the foregoing covenants to be unenforceable with respect to the term thereof or the scope of the subject matter or geography covered thereby, then such
covenant shall nonetheless be enforceable by such court against the Seller or other relevant Person upon such shorter term or within such lesser scope as may be determined by the court to be reasonable and enforceable. In the event the Seller or any
of its Affiliates is in violation of the aforementioned restrictive covenants, then the time limitation thereof shall be extended for a period of time during which such breach or breaches shall occur, unless a court of competent jurisdiction renders
a final non-appealable judgment to the effect that such extension is illegal or unenforceable. 
  
 (e) The Seller further covenants and agrees that, without the prior written consent of the Buyer, neither the Seller nor any of its Affiliates will, for a period of one (1) year following the Closing Date, solicit for
employment as an employee, officer, agent, consultant, advisor, or in any other capacity whatsoever, any employee of the Buyer employed in the Business. As used herein, “solicit” means contact or communicate in any manner whatsoever,
including, but not limited to, contacts or communications by or through intermediaries, agents, contractors, 
  

 15 

 representatives, or other parties, provided that nothing herein shall be construed to prohibit the Seller from (i)
placing advertisements for employment that are aimed at the public at large in any newspaper, trade magazine, or other periodical in general circulation, or (ii) responding to any unsolicited inquiry by any Buyer employee concerning employment.

  
 6.4 TRANSITION. The Seller will not take any action that is designed or
intended to have the effect of discouraging any lessor, licensor, customer, supplier, or other business associate of the Seller from maintaining the same business relationships with respect to the Business with the Buyer after the Closing as it
maintained with the Seller prior to the Closing. 
  
 6.5 BULK SALES. The Buyer
acknowledges that the Seller is not complying with the provisions of the bulk sales or similar laws of any and all states, and the Buyer hereby waives compliance by the Seller therewith. 
  
 ARTICLE 7 
 CONDITIONS TO OBLIGATION TO CLOSE 
  
 7.1 CONDITIONS TO OBLIGATION
OF THE BUYER. The obligation of the Buyer to consummate the transactions to be performed by it in connection with the Closing is subject to satisfaction of the following conditions: 
  
 (a) the representations and warranties set forth in Article 4 shall be true and correct in all material respects at and as
of the Closing Date; 
  
 (b) the Seller shall have performed and
complied with all of its covenants hereunder in all material respects through the Closing; 
  
 (c) no injunction, judgment, order, decree, ruling or charge shall be in effect which purports to prevent consummation of any of the transactions contemplated by this Agreement; 
  
 (d) the Seller shall have delivered to the Buyer a certificate to the effect
that each of the conditions specified in Section 7.1(a) through 7.1(c) is satisfied in all respects; 
  
 (e) the Seller shall have executed and delivered (or tendered subject to Closing) the Seller’s Closing Documents; 
  
 (f) the Seller shall have delivered resolutions of the Seller’s Board of
Directors duly authorizing the execution, delivery and performance of this Agreement, and the consummation of the transactions contemplated hereby, certified as of the Closing Date by the Seller’s Secretary as having been duly adopted and being
in full force and effect and unmodified on the Closing Date; 
  

 16 

 (g) the Seller shall have delivered a certificate of incumbency certified by the Seller’s Secretary
verifying the office and authority of the Seller’s officer(s) and any other authorized signatory at Closing; 
  
 (h) the Seller shall have delivered a legal opinion of Arent Fox LLP addressed to the Buyer and dated the Closing Date, in customary form for transactions
of this type and reasonably acceptable to the Buyer; and 
  
 (i)
all actions to be taken by the Seller in connection with consummation of the transactions contemplated hereby and all certificates, opinions, instruments, and other documents required to effect the transactions contemplated hereby will be reasonably
satisfactory in form and substance to the Buyer. 
  
 The Buyer may waive any
condition specified in this Section 7.1 if it executes a writing so stating at or prior to the Closing. 
  
 7.2 CONDITIONS TO OBLIGATION OF THE SELLER. The obligation of the Seller to consummate the transactions to be performed by it in connection with the Closing is subject to satisfaction of the following conditions:

  
 (a) the representations and warranties set forth in Article 3
shall be true and correct in all material respects at and as of the Closing Date; 
  
 (b) the Buyer shall have performed and complied with all of its covenants hereunder in all material respects through the Closing; 
  
 (c) no injunction, judgment, order, decree, ruling or charge shall be in effect which purports to prevent consummation of
any of the transactions contemplated by this Agreement; 
  
 (d)
the Buyer shall have delivered to the Seller a certificate to the effect that each of the conditions specified in Section 7.2(a) through 7.2(c) is satisfied in all respects; 
  
 (e) the Buyer shall have entered into Buyer’s Closing Documents; and 
  
 (f) the Buyer shall have delivered resolutions of the Buyer’s Board of
Directors duly authorizing the execution, delivery and performance of this Agreement, and the consummation of the transactions contemplated hereby, certified as of the Closing Date by the Buyer’s Secretary as having been duly adopted and being
in full force and effect and unmodified on the Closing Date; 
  
 (g) the Buyer shall have delivered a certificate of incumbency certified by the Buyer’s Secretary verifying the office and authority of the Buyer’s officer(s) and any other authorized signatory at Closing; 
  

 17 

 (h) all actions to be taken by the Buyer in connection with consummation of the transactions contemplated
hereby and all certificates, opinions, instruments, and other documents required to effect the transactions contemplated hereby will be reasonably satisfactory in form and substance to the Seller; 
  
 (i) the Buyer shall have delivered to the Seller a copy of the proposed
Letter of Credit (referred to in Section 2.3(b)) in the amount of $600,000 and in a form reasonably satisfactory to the Seller; such Letter of Credit shall provide that solely upon certification from the Seller to the issuing bank that the Buyer is
in default, under the Promissory Note, referred to in Section 2.3(b), the bank shall be unconditionally obligated to disburse directly to the Seller the amount (not in excess of $600,000) certified by the Seller to be in default; such certification
and disbursement shall not, however, deprive the Buyer, subsequent to such disbursement, of any defenses or claims the Buyer may have against the Seller relating to such Note. 
  
 The Seller may waive any condition specified in this Section 7.2 if it executes a writing so stating at or prior to the Closing. 

 
 ARTICLE 8 
 INDEMNIFICATION 
  
 8.1 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All of the representations and warranties of the Seller contained in Article 4 and Article 4A shall survive the Closing (unless the Buyer knew of any misrepresentation or breach of warranty at
the time of Closing) and continue in full force and effect for a period ending the date that is two years following the Closing Date. All of the representations and warranties of the Buyer contained in Article 3 shall survive the Closing (unless the
Seller knew of any misrepresentation or breach of warranty at the time of Closing) and continue in full force and effect for a period ending the date that is two years following the Closing Date. The Buyer acknowledges that, except for the
representations and warranties of the Seller specifically set forth in Article 4, Article 4A and the Schedules, the Buyer has not relied on any information provided by the Seller in connection with the transactions contemplated by this Agreement as
constituting a representation or warranty of the Seller. 
  
 8.2 INDEMNIFICATION
PROVISIONS FOR BENEFIT OF THE BUYER. In the event the Seller breaches any representations, warranties, covenants or agreements of the Seller contained herein (including, but not limited to, the statements made by the Seller’s executive officers
in the certificate referenced in Section 7.1(d) hereof), and, provided the Buyer issues a Claim Notice (as hereinafter defined) within any such survival period, then, subject to the terms hereof, the Seller agrees to indemnify the Buyer from and
against any Adverse Consequences the Buyer may suffer through and after the date of the claim for indemnification resulting from, arising out of, relating to, in the nature of, or caused by the breach regardless of when the Adverse Consequences may
occur. 
  

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 8.3 INDEMNIFICATION PROVISIONS FOR BENEFIT OF THE SELLER. In the event the Buyer breaches any representations,
warranties, covenants or agreements of the Buyer contained herein, and provided the Seller issues a Claim Notice within any survival period, then the Buyer agrees to indemnify the Seller from and against any Adverse Consequences the Seller may
suffer through and after the date of the claim for indemnification resulting from, arising out of, relating to, in the nature of or caused by the breach regardless of when the Adverse Consequences may occur. 
  
 8.4 PROCEDURE FOR MATTERS INVOLVING THIRD PARTIES. 
  
 (a) If any third party shall notify any Party (the “Indemnified
Party”) with respect to any matter (a “Third Party Claim”) which may give rise to a claim for indemnification against any other Party (the “Indemnifying Party”) under this Article 8, then the Indemnified Party shall promptly
issue a Claim Notice to the Indemnifying Party with respect thereto. 
  
 (b) Any Indemnifying Party will have the right to defend the Indemnified Party against the Third Party Claim with counsel of its choice reasonably satisfactory to the Indemnified Party so long as (i) the Indemnifying Party notifies the
Indemnified Party in writing within 30 days following the receipt of the Claim Notice that the Indemnifying Party will indemnify the Indemnified Party from and against the entirety of any Adverse Consequences the Indemnified Party may suffer
resulting from, arising out of, relating to, in the nature of, or caused by the Third Party Claim, and (ii) the Indemnifying Party conducts the defense of the Third Party Claim actively and diligently. 
  
 (c) So long as the Indemnifying Party is conducting the defense of the Third
Party Claim in accordance with Section 8.4(b), the Indemnified Party may retain separate co-counsel at its sole cost and expense and participate in the defense of the Third Party Claim. 
  
 (d) The Indemnified Party will not consent to the entry of any judgment or enter into any settlement with respect to the
Third Party Claim without the prior written consent of the Indemnifying Party, which consent will not be unreasonably withheld and (iii) the Indemnifying Party will not consent to the entry of any judgment or enter into any settlement with respect
to the Third Party Claim without the prior written consent of the Indemnified Party, which consent will not be unreasonably withheld, except the Indemnifying Party may consent to the entry of judgment or settlement without the consent of the
Indemnified Party if the judgment or settlement is solely for money damages. 
  
 (e) A Party suffering Adverse Consequences or a Party that determines that any occurrence or claim may result in Adverse Consequences that gives or could give rise to a claim for indemnification under this Article 8
shall promptly notify each other Party thereof in writing (a “Claim Notice”) in accordance with Section 11.7. The Claim Notice shall contain a brief description of the nature of the Adverse Consequences suffered and, if practicable, an
aggregate dollar value estimate of the Adverse Consequence suffered. No delay in the issuance of a Claim Notice shall relieve any Party from any obligation under this Article 8, unless and solely to the extent such Party is thereby prejudiced.

  

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 8.5 LIMITATIONS ON THE SELLER’S INDEMNIFICATION LIABILITY. 
  
 (a) Threshold. The Seller shall not have any liability for an
indemnification claim under this Article 8, unless and until the aggregate Adverse Consequences associated such claims exceed Five Thousand Dollars ($5,000) and then only for the amount which exceeds this threshold. 
  
 (b) Period. No indemnification shall be available after the date that
is two years following the Closing Date, except in respect of Adverse Consequences relating to Claim Notices delivered prior to such date. 
  
 (c) Offset. The Buyer shall not have the right to offset either installment of the deferred Purchase Price, payable by Buyer to Seller under
Section 2.3(b), with any claim against the Seller under this Article 8 or under any other provision of this Agreement. Rather, the Buyer shall be required to pay each installment on time and in full, and pursue any such claim as a separate matter.

  
 8.6 LIMITATIONS ON THE BUYER’S INDEMNIFICATION LIABILITY. 
  
 (a) Threshold. The Buyer shall not have any liability for an
indemnification claim under this Article 8, unless and until the aggregate Adverse Consequences associated with such claims exceed Five Thousand Dollars ($5,000) and then only for the amount which exceeds this threshold; except this threshold shall
not apply to any failure to close and pay the Purchase Price as required hereunder or to pay the Assumed Liabilities. 
  
 (b) Period. No indemnification shall be available after the date that is two years following the Closing Date, except in respect of Adverse
Consequences relating to Claim Notices delivered prior to such date. 
  
 8.7
DETERMINATION OF ADVERSE CONSEQUENCES. In determining Adverse Consequences for purposes of this Agreement, any payment to be made by any Indemnifying Party hereunder shall be reduced (but not below zero) to take into account any Tax benefit realized
or reasonably expected to be realizable by the Indemnified Party arising from the incurrence of an Adverse Consequence. 
  
 8.8 EXCLUSIVE REMEDY. The Buyer and the Seller acknowledge and agree that the foregoing indemnification provisions in this Article 8 shall be the exclusive remedy of the
Buyer if and after the Closing has occurred with respect to the transactions contemplated by this Agreement. 
  
 8.9 TAX TREATMENT OF INDEMNITY PAYMENTS. Seller and Buyer agree to treat any indemnity payment made pursuant to this Agreement as an adjustment to the Purchase Price for federal, state, local and foreign Tax purposes.

  

 20 

 ARTICLE 9 
 TERMINATION 
  
 9.1 TERMINATION OF
AGREEMENT. The Parties may terminate this Agreement as provided below: 
  
 (a) The Buyer and the Seller may terminate this Agreement by mutual written consent at any time prior to the Closing; 
  
 (b) The Buyer may terminate this Agreement (i) in the event the Seller has breached any representation, warranty, or covenant contained in this Agreement
in any material respect; or (ii) if the Closing shall not have occurred on or before December 31, 2004, by reason of the failure of any condition precedent under Section 7.1 (unless the failure results primarily from the Buyer itself breaching any
representation, warranty, or covenant contained in this Agreement). 
  
 (c) The Seller may terminate this Agreement by giving written notice to the Buyer at any time prior to the Closing (i) in the event the Buyer has breached any representation, warranty, or covenant contained in this Agreement in any material
respect; or (ii) if the Closing shall not have occurred on or before December 18, 2004, by reason of the failure of any condition precedent under Section 7.2 (unless the failure results primarily from the Seller breaching any representation,
warranty, or covenant contained in this Agreement). 
  
 9.2 EFFECT OF TERMINATION;
SPECIFIC PERFORMANCE. If any Party terminates this Agreement pursuant to Section 9.1, all rights and obligations of the Parties hereunder shall terminate without any liability of any Party to any other Party (except for any liability of any Party
then committing willful default or willful breach); provided, however, that the confidentiality provisions contained herein shall survive termination. If any Party terminates this Agreement other than as permitted by Section 9.1, the non-breaching
party would suffer irreparable damage and therefore shall be entitled to specific performance of the terms hereof in addition to any other remedy at law or in equity. 
  
 ARTICLE 10 
 MISCELLANEOUS 
  
 10.1 PRESS RELEASES AND PUBLIC ANNOUNCEMENTS. No
Party shall issue any press release or make any public announcement relating to the subject matter of this Agreement prior to the Closing without the prior written approval of the other Party; provided, however, that the Buyer, as a publicly traded
entity, intends to issue, upon the execution of this Agreement, a Current Report on Form 8-K and a press release relating to the transactions contemplated hereby. 
  
 10.2 NO THIRD-PARTY BENEFICIARIES. This Agreement shall not confer any rights or remedies upon any Person other than the Parties and their
respective successors and permitted assigns. 
  

 21 

 10.3 ENTIRE AGREEMENT. This Agreement (including the Exhibits, Schedules hereto and the documents referred to herein)
constitutes the entire agreement among the Parties and, except as provided herein, supersedes any prior understandings, agreements, or representations by or among the Parties, written or oral, to the extent they relate in any way to the subject
matter hereof. 
  
 10.4 SUCCESSION AND ASSIGNMENT. This Agreement shall be binding
upon and inure to the benefit of the Parties named herein and their respective successors and permitted assigns. No Party may assign either this Agreement or any of its rights, interests, or obligations hereunder without the prior written approval
of the other Party hereto. 
  
 10.5 COUNTERPARTS. This Agreement may be executed
in one or more counterparts, each of which shall be deemed an original but all of which together will constitute one and the same instrument. 
  
 10.6 HEADINGS. The section headings contained in this Agreement are inserted for convenience only and shall not affect in any way the meaning or interpretation of this
Agreement. 
  
 10.7 NOTICES. All notices, requests, demands, claims, and other
communications hereunder will be in writing. Any notice, request, demand, claim, or other communication hereunder shall be deemed duly given if (and then two business days after) it is sent by registered or certified mail, return receipt requested,
postage prepaid, and addressed to the intended recipient as set forth below: 
  
 If to the Seller: 
  
 Genetics & IV Institute, Inc. 
 3020 Javier Road 
 Fairfax, Virginia 22031 
 Attention: Randall Wall 
                President and Chief Executive Officer 
 Telephone: (703) 876-3883 
 Facsimile: (703) 698-2060 
  

 22 

 Copies to: 
  
 Arent Fox PLLC 
 1050 Connecticut Avenue, NW 
 Washington, DC 20036-5339 
 Attention:   Earl M. Colson, Esq. 
 Telephone: (202) 857-6205 
 Facsimile:   (202) 857-6395 
  
 If to the Buyer: 
  
 Commonwealth Biotechnologies, Inc. 
 601 Biotech Drive 
 Richmond, Virginia 23235 
 Attention: Robert B. Harris, Ph.D. 
                  President and Chief Executive
Officer 
 Telephone: (804) 915-3840 
 Facsimile: (804) 915-3830 
  
 Copies to: 
  
 Kaufman & Canoles, P.C. 
 Three James Center 
 1051 East Cary Street, 12th Floor 
 Richmond, Virginia 23219

 Attention:   Bradley A. Haneberg, Esq. 
 Telephone: (804) 771-5790 
 Facsimile:   (804) 771-5777 
  
 Any
Party may send any notice, request, demand, claim, or other communication hereunder to the intended recipient at the address set forth above using any other means (including personal delivery, expedited courier, messenger service, telecopy or
ordinary mail), but no such notice, request, demand, claim, or other communication shall be deemed to have been duly given unless and until it actually is received by the intended recipient. Any Party may change the address to which notices,
requests, demands, claims, and other communications hereunder are to be made available by giving the other Parties notice in the manner herein set forth. 
  
 10.8 GOVERNING LAW. This Agreement shall be governed by and construed in accordance with the domestic laws of the Commonwealth of Virginia without giving effect to any
choice or conflict of law provision or rule (whether of the Commonwealth of Virginia or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the Commonwealth of Virginia. The parties hereby agree to
waive any right they may have under any applicable Federal or state law to a trial before a jury. 
  

 23 

 10.9 AMENDMENTS AND WAIVERS. No amendment of any provision of this Agreement shall be valid unless the same shall be in
writing and signed by the Buyer and the Seller. No waiver by any Party 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. 
  
 10.10 SEVERABILITY. Any term or provision of this Agreement that is invalid or unenforceable in any situation in any jurisdiction shall not affect the validity or
enforceability of the remaining terms and provisions hereof or the validity or enforceability of the offending term or provision in any other situation or in any other jurisdiction. 
  
 10.11 EXPENSES. Except as provided herein regarding indemnification matters, each of the Parties will bear its own costs and expenses
(including legal fees and expenses) incurred in connection with this Agreement and the transactions contemplated hereby. The Buyer shall pay the cost of any title policies or surveys it elects to obtain, and shall pay all recording costs. Without
limiting the foregoing, the parties shall pro rate (as of the Closing Date), if applicable, real estate payments, and real estate and personal property taxes. 
  

10.12 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.
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. The word “including” shall mean including
without limitation. 
  
 10.13 INCORPORATION OF EXHIBITS AND SCHEDULES. The
Exhibits and Schedules identified in this Agreement are incorporated herein by reference and made a part hereof. 
  
 [SIGNATURES ON THE FOLLOWING PAGE] 
  

 24 

 IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on the date first above
written. 
  

			
	 BUYER:
  

	 COMMONWEALTH BIOTECHNOLOGIES, INC.
  
  

	By:	 	 /s/  Robert B. Harris

	Name:	 	 Robert B. Harris

	Title:	 	 President/CEO

	Date:	 	 11/18/04

  

			
	 SELLER:
  

	 GENETICS & IVF INSTITUTE, INC.
  
  

	By:	 	 /s/  Randall J. Wall

	Name:	 	 Randall J. Wall

	Title:	 	 CEO

	Date:	 	 11/18/04

  

 25

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