Document:

Unassociated Document

    

      Exhibit
        10.1

       

      

      

      

      
        

        

      

      

      

       

       

      ASSET
        PURCHASE AGREEMENT

      

      among

       

      LAUREATE
        PHARMA, INC.

      (a
        Delaware corporation),

       

      and

       

      DISCOVERY
        LABORATORIES, INC.

      (a
        Delaware corporation)

      

       

       

      
 

      
        

        

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      TABLE
        OF CONTENTS

       

      
        	
                Section

              	
                Page

              

      

      

        
          
            	
                    INTRODUCTION

                     

                  	
                    1

                     

                  
	
                    BACKGROUND

                     

                  	
                    1

                     

                  
	
                    1.

                     

                  	
                    Definitions

                     

                  	1
	
                    2.

                     

                  	
                    Sale
                      and Purchase

                     

                  	10
	 	
                    2.1

                     

                  	
                    Agreement
                      to Sell and Purchase

                     

                  	
                    10

                     

                  
	 	
                    2.2

                     

                  	
                    Purchase
                      Price

                     

                  	
                    12

                     

                  
	 	
                    2.3

                     

                  	
                    Assumption
                      of Liabilities

                     

                  	
                    12

                     

                  
	 	
                    2.4

                     

                  	
                    Consent
                      of Third Parties

                     

                  	
                    13

                     

                  
	
                    3.

                     

                  	
                    Closing

                     

                  	
                    14

                     

                  
	 	
                    3.1

                     

                  	
                    Location;
                      Date

                     

                  	
                    14

                     

                  
	 	
                    3.2

                     

                  	
                    Deliveries

                     

                  	
                    14

                     

                  
	
                    4.

                     

                  	
                    Representations
                      and Warranties of Seller

                     

                  	
                    15

                     

                  
	 	
                    4.1

                     

                  	
                    Organization
                      and Standing

                     

                  	
                    16

                     

                  
	 	
                    4.2

                     

                  	
                    [Reserved]

                     

                  	
                    16

                     

                  
	 	
                    4.3

                     

                  	
                    Authority
                      and Binding Effect

                     

                  	
                    16

                     

                  
	 	
                    4.4

                     

                  	
                    Consents
                      and Approvals

                     

                  	
                    16

                     

                  
	 	
                    4.5

                     

                  	
                    [Reserved]

                     

                  	
                    16

                     

                  
	 	
                    4.6

                     

                  	
                    [Reserved]

                     

                  	
                    16

                     

                  
	 	
                    4.7

                     

                  	
                    Taxes

                     

                  	
                    16

                     

                  
	 	
                    4.8

                     

                  	
                    [Reserved]

                     

                  	
                    17

                     

                  
	 	
                    4.9

                     

                  	
                    [Reserved]

                     

                  	
                    17

                     

                  
	 	
                    4.10

                     

                  	
                    Inventory

                     

                  	
                    17

                     

                  
	 	
                    4.11

                     

                  	
                    Title
                      to Purchased Assets and Related Matters

                     

                  	
                    17

                     

                  
	 	
                    4.12

                     

                  	
                    Condition
                      of Purchased Assets

                     

                  	
                    18

                     

                  
	 	
                    4.13

                     

                  	
                    Real
                      Property

                     

                  	
                    18

                     

                  
	 	
                    4.14

                     

                  	
                    Intellectual
                      Property.

                     

                  	
                    19

                     

                  
	 	
                    4.15

                     

                  	
                    Contracts

                     

                  	
                    20

                     

                  
	 	
                    4.16

                     

                  	
                    Employees/Independent
                      Contractors

                     

                  	
                    21

                     

                  
	 	
                    4.17

                     

                  	
                    Governmental
                      Permits

                     

                  	
                    21

                     

                  
	 	
                    4.18

                     

                  	
                    Compliance
                      with Law and Court Orders

                     

                  	
                    21

                     

                  
	 	
                    4.19

                     

                  	
                    Claims

                     

                  	
                    22

                     

                  
	 	
                    4.20

                     

                  	
                    Insurance

                     

                  	
                    22

                     

                  
	 	
                    4.21

                     

                  	
                    Non-Real
                      Estate Leases

                     

                  	
                    22

                     

                  

          

           

          
            
              
              

            

            
              i

              
                

              

            

            
              
              

            

          

           

            TABLE
              OF CONTENTS

            (continued)

            
              	
                      Section

                    	
                      Page

                    

            

          

          
             

            
              	 	
                      4.22

                       

                    	
                      Employee
                        Benefit Plans

                       

                    	
                      22

                       

                    
	 	
                      4.23

                       

                    	
                      [Reserved]

                       

                    	
                      23

                       

                    
	 	
                      4.24

                       

                    	
                      Environmental
                        Matters

                       

                    	
                      23

                       

                    
	 	
                      4.25

                       

                    	
                      [Reserved]

                       

                    	
                      25

                       

                    
	 	
                      4.26

                       

                    	
                      Broker’s
                        or Finder’s Fee

                       

                    	
                      25

                       

                    
	 	
                      4.27

                       

                    	
                      [Reserved]

                       

                    	
                      25

                       

                    
	 	
                      4.28

                       

                    	
                      Certain
                        Personal Property

                       

                    	
                      25

                       

                    
	 	
                      4.29

                       

                    	
                      [Reserved]

                       

                    	
                      25

                       

                    
	 	
                      4.30

                       

                    	
                      [Reserved]

                       

                    	
                      25

                       

                    
	 	
                      4.31

                       

                    	
                      Solvency

                       

                    	
                      25

                       

                    
	 	
                      4.32

                       

                    	
                      FDA

                       

                    	
                      25

                       

                    
	 	
                      4.33

                       

                    	
                      Statements
                        and Other Documents Not Misleading.

                       

                    	
                      26

                       

                    
	
                      5.

                       

                    	
                      Representations
                        and Warranties of Buyer

                       

                    	
                      26

                       

                    
	 	
                      5.1

                       

                    	
                      Organization
                        and Standing

                       

                    	
                      26

                       

                    
	 	
                      5.2

                       

                    	
                      Authority
                        and Binding Effect

                       

                    	
                      26

                       

                    
	 	
                      5.3

                       

                    	
                      Validity
                        of Contemplated Transactions

                       

                    	
                      26

                       

                    
	 	
                      5.4

                       

                    	
                      Broker’s
                        or Finder’s Fee

                       

                    	
                      27

                       

                    
	 	
                      5.5

                       

                    	
                      Availability
                        of Funds

                       

                    	
                      27

                       

                    
	 	
                      5.6

                       

                    	
                      Claims

                       

                    	
                      27

                       

                    
	 	
                      5.7

                       

                    	
                      FDA

                       

                    	
                      27

                       

                    
	
                      6.

                       

                    	
                      Pre-Closing
                        Covenants

                       

                    	
                      27

                       

                    
	 	
                      6.1

                       

                    	
                      Access

                       

                    	
                      27

                       

                    
	 	
                      6.2

                       

                    	
                      [Reserved]

                       

                    	
                      27

                       

                    
	 	
                      6.3

                       

                    	
                      Operation
                        of the Business

                       

                    	
                      27

                       

                    
	 	
                      6.4

                       

                    	
                      Update
                        of Schedules

                       

                    	
                      28

                       

                    
	 	
                      6.5

                       

                    	
                      Employees
                        and Business Relations

                       

                    	
                      28

                       

                    
	 	
                      6.6

                       

                    	
                      Confidentiality.

                       

                    	
                      30

                       

                    
	 	
                      6.7

                       

                    	
                      Related
                        Parties

                       

                    	
                      30

                       

                    
	 	
                      6.8

                       

                    	
                      Transfer
                        of Purchased Assets and Business

                       

                    	
                      30

                       

                    
	 	
                      6.9

                       

                    	
                      Fulfillment
                        of Closing Conditions

                       

                    	
                      30

                       

                    
	 	
                      6.10

                       

                    	
                      DMF

                       

                    	
                      31

                       

                    
	 	
                      6.11

                       

                    	
                      [Reserved]

                       

                    	
                      31

                       

                    
	 	
                      6.12

                       

                    	
                      [Reserved]

                       

                    	
                      31

                       

                    

            

             

            
              
                
                

              

              
                ii

                
                  

                

              

              
                
                

              

            

            
               

              TABLE
                OF CONTENTS

              (continued)

              
                	
                        Section

                      	
                        Page

                      

              

            

             

            
              
                	 	
                        6.13

                         

                      	
                        [Reserved]

                         

                      	
                        31

                         

                      
	 	
                        6.14

                         

                      	
                        Environmental

                         

                      	
                        31

                         

                      
	 	
                        6.15

                         

                      	
                        Further
                          Assurances

                         

                      	
                        31

                         

                      
	
                        7.

                         

                      	
                        Post-Closing
                          Covenants

                         

                      	
                        31

                         

                      
	 	
                        7.1

                         

                      	
                        Transition
                          Period

                         

                      	
                        31

                         

                      
	 	
                        7.2

                         

                      	
                        Employees

                         

                      	
                        31

                         

                      
	 	
                        7.3

                         

                      	
                        Tax
                          Matters

                         

                      	
                        32

                         

                      
	 	
                        7.4

                         

                      	
                        Governmental
                          Permits

                         

                      	
                        33

                         

                      
	 	
                        7.5

                         

                      	
                        Existing
                          Seller Clients

                         

                      	
                        34

                         

                      
	 	
                        7.6

                         

                      	
                        DMF

                         

                      	
                        34

                         

                      
	 	
                        7.7

                         

                      	
                        Insurance

                         

                      	
                        34

                         

                      
	 	
                        7.8

                         

                      	
                        Totowa
                          Property Signage

                         

                      	
                        34

                         

                      
	
                        8.

                         

                      	
                        Conditions
                          Precedent to Obligations of Buyer

                         

                      	
                        34

                         

                      
	 	
                        8.1

                         

                      	
                        Representations
                          and Warranties; Performance of Obligations

                         

                      	
                        34

                         

                      
	 	
                        8.2

                         

                      	
                        Closing
                          Documents

                         

                      	
                        34

                         

                      
	 	
                        8.3

                         

                      	
                        Closing
                          Consents

                         

                      	
                        34

                         

                      
	 	
                        8.4

                         

                      	
                        [Reserved]

                         

                      	
                        35

                         

                      
	 	
                        8.5

                         

                      	
                        [Reserved]

                         

                      	
                        35

                         

                      
	 	
                        8.6

                         

                      	
                        Legal
                          Matters

                         

                      	
                        35

                         

                      
	 	
                        8.7

                         

                      	
                        Opinion
                          of Seller’s Counsel

                         

                      	
                        35

                         

                      
	
                        9.

                         

                      	
                        Conditions
                          Precedent to Obligations of Seller

                         

                      	
                        35

                         

                      
	 	
                        9.1

                         

                      	
                        Representations
                          and Warranties; Performance of Obligations

                         

                      	
                        35

                         

                      
	 	
                        9.2

                         

                      	
                        Legal
                          Matters

                         

                      	
                        35

                         

                      
	 	
                        9.3

                         

                      	
                        Consents

                         

                      	
                        35

                         

                      
	
                        10.

                         

                      	
                        Indemnification

                         

                      	
                        35

                         

                      
	 	
                        10.1

                         

                      	
                        By
                          Seller

                         

                      	
                        35

                         

                      
	 	
                        10.2

                         

                      	
                        By
                          Buyer

                         

                      	
                        36

                         

                      
	 	
                        10.3

                         

                      	
                        Procedure
                          for Claims

                         

                      	
                        37

                         

                      
	 	
                        10.4

                         

                      	
                        Limitations
                          on Liability

                         

                      	
                        37

                         

                      
	 	
                        10.5

                         

                      	
                        Third
                          Party Claims

                         

                      	
                        39

                         

                      
	 	
                        10.6

                         

                      	
                        Right
                          of Offset

                         

                      	
                        40

                         

                      
	 	
                        10.7

                         

                      	
                        Effect
                          of Investigation or Knowledge

                         

                      	
                        40

                         

                      
	 	
                        10.8

                         

                      	
                        Contingent
                          Claims

                         

                      	
                        40

                         

                      

              

               

              
                
                  
                  

                

                
                  iii

                  
                    

                  

                

                
                  
                  

                

              

               

              
                TABLE
                  OF CONTENTS

                (continued)

                
                  	
                          Section

                        	
                          Page

                        

                

              

               

              
                	
                        11.

                         

                      	
                        Termination

                         

                      	
                        40

                         

                      
	 	
                        11.1

                         

                      	
                        Grounds
                          for Termination

                         

                      	
                        40

                         

                      
	 	
                        11.2

                         

                      	
                        Effect
                          of Termination

                         

                      	
                        41

                         

                      
	
                        12.

                         

                      	
                        Other
                          Matters

                         

                      	
                        41

                         

                      
	 	
                        12.1

                         

                      	
                        Public
                          Announcements

                         

                      	
                        41

                         

                      
	 	
                        12.2

                         

                      	
                        Reasonable
                          Best Efforts

                         

                      	
                        41

                         

                      
	 	
                        12.3

                         

                      	
                        Nondisparagement

                         

                      	
                        41

                         

                      
	
                        13.

                         

                      	
                        Miscellaneous

                         

                      	
                        41

                         

                      
	 	
                        13.1

                         

                      	
                        Contents
                          of Agreement

                         

                      	
                        41

                         

                      
	 	
                        13.2

                         

                      	
                        Amendment,
                          Parties in Interest, Assignment, Etc

                         

                      	
                        42

                         

                      
	 	
                        13.3

                         

                      	
                        Interpretation

                         

                      	
                        42

                         

                      
	 	
                        13.4

                         

                      	
                        Sole
                          Remedy

                         

                      	
                        42

                         

                      
	 	
                        13.5

                         

                      	
                        Dispute
                          Resolution

                         

                      	
                        42

                         

                      
	 	
                        13.6

                         

                      	
                        Expenses

                         

                      	
                        43

                         

                      
	 	
                        13.7

                         

                      	
                        Bulk
                          Sales

                         

                      	
                        43

                         

                      
	 	
                        13.8

                         

                      	
                        Notices

                         

                      	
                        43

                         

                      
	 	
                        13.9

                         

                      	
                        Governing
                          Law

                         

                      	
                        44

                         

                      
	 	
                        13.10

                         

                      	
                        Counterparts

                         

                      	
                        44

                         

                      

              

            

          

        

      

      

       

      

       

      
        
          
          

        

        
          iv

          
            

          

        

        
          
          

        

      

      
        	
                Exhibits

                 

              	 
	
                Exhibit
                  A

                 

              	
                Bill
                  of Sale, Assignment and Assumption Agreement 

                 

              
	
                Exhibit
                  B-1

                 

              	
                Transition
                  Services Agreement

                 

              
	
                Exhibit
                  B-2

                 

              	
                Quality
                  Agreement

                 

              
	
                Exhibit
                  C-1

                 

              	
                Notices
                  related to Drug Establishment Registrations for Totowa

                 

              
	
                Exhibit
                  C-2

                 

              	
                Notices
                  related to Drug Establishment Registrations for Totowa

                 

              
	
                Exhibit
                  C-3

                 

              	
                Notices
                  related to Drug Establishment Registrations for Totowa

                 

              
	
                Exhibit
                  D

                 

              	
                Form
                  of Opinion

                 

              
	
                Exhibit
                  E

                 

              	
                Parent
                  Guaranty

                 

              
	
                Exhibit
                  F

                 

              	
                Consent
                  to Assignment

                 

              
	
                Exhibit
                  G

                 

              	
                Assignment
                  of Lease and Termination and Option Agreement

                 

              
	
                Exhibit
                  H-1 

                 

              	
                Amendment
                  to Lease

                 

              
	
                Exhibit
                  H-2 

                 

              	
                Amendment
                  to Termination and Option Agreement

                 

              
	
                Exhibit
                  I

                 

              	
                Termination
                  Agreement

                 

              

      

      

       

      

       

      
        
          
          

        

        
          v

          
            

          

        

        
          
          

        

      

       

      
        ASSET
          PURCHASE AGREEMENT

         

        INTRODUCTION

         

        This
          ASSET PURCHASE AGREEMENT is dated as of December 27, 2005. The parties
          are
          Laureate Pharma, Inc., a Delaware corporation (“Seller”),
          and
          Discovery Laboratories, Inc., a Delaware corporation (“Buyer”).
          Buyer
          and Seller are referred to herein as the “Parties.”

         

        BACKGROUND

        Seller
          owns and operates the Business (defined below). This Agreement defined
          below
          sets forth the terms and conditions upon which Buyer is purchasing the
          Purchased
          Assets (defined below) and assuming the Assumed Liabilities (defined below)
          from
          Seller and Seller is selling the Purchased Assets and transferring the
          Assumed
          Liabilities to Buyer.

         

        NOW,
          THEREFORE, in consideration of the respective covenants, representations
          and
          warranties herein contained, and intending to be legally bound hereby,
          the
          parties hereto agree as follows:

         

        1.    Definitions.

         

        For
          convenience, certain terms used in more than one part of this Agreement
          are
          listed in alphabetical order and defined or referred to below.

         

        “33%
          Cap”
          is
          defined in Section
          10.4(a).

         

        “Accounts
          Receivable”
          means,
          as of any specified date, any trade accounts receivable, notes receivable,
          bid
          or performance deposits and other miscellaneous receivables of the Business.
          

         

        “Accrued
          Bonus”
          is
          defined in Section
          6.5(b).

         

        “Action”
          is
          defined in Section
          10.5(a).

         

        “Affiliates”
          means,
          with respect to a Party, Persons controlling, controlled by or under common
          control with that Party, as well as any officers, directors and majority-owned
          entities of that Party and of its other Affiliates. For the purposes of
          the
          foregoing, ownership, directly or indirectly, of 20% or more of the voting
          stock
          or other equity interest shall be deemed to constitute control. 

         

        “Agreement”
          means
          this Asset Purchase Agreement, including all schedules and exhibits hereto.
          

         

        “Allocation”
          is
          defined in Section
          7.3(d).

         

        “Allocation
          Arbiter”
          is
          defined in Section
          7.3(d).

         

        “Amendment
          to Lease”
          means
          the Amendment No. 1 to the Agreement of Lease dated December 3, 2004, between
          Norwell Land Company, as Landlord, and Seller, as Tenant, substantially
          in the
          form of Exhibit
          H-1.

         

        “Amendment
          to Termination and Option Agreement”
          means
          Amendment No. 1 to the Termination and Option Agreement dated December
          3, 2004,
          between Norwell Land Company, as Landlord, and Seller, as Tenant, substantially
          in the form of Exhibit
          H-2.

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

        “Ancillary
          Agreements”
          means
          the Termination Agreement, the Amendment to Lease and the Amendment to
          Termination and Option Agreement.

         

        “Assets”
          means
          all of Seller’s assets, properties, business, goodwill and rights of every kind
          and description, real and personal, tangible and intangible, located at
          the
          Totowa Property and used in the operation of the Business.

         

        “Assignee”
          is
          defined in Section
          13.2.

         

        “Assignment
          of Lease and Termination and Option Agreement”
          means
          the Assignment of Lease and Termination and Option Agreement, by and between
          Seller, as tenant, and Buyer, as assignee, substantially in the form of
          Exhibit
          G.

         

        “Association”
          is
          defined in Section
          13.5(b).

         

        “Assumed
          Liabilities”
          is
          defined in Section
          2.3(a).
          

         

        “Bill
          of Sale, Assignment and Assumption Agreement”
          means a
          bill of sale, assignment and assumption agreement by and between Seller
          and
          Buyer in substantially the same form as Exhibit
          A.
          

         

        “BLAs”
          is
          defined in Section
          4.32.

         

        “Business”means
          the
          business operations of Seller conducted solely at the Totowa Property relating
          to the performance by Seller of its obligations under the Existing Manufacturing
          Agreement, including the furnishing of development services, process design
          and
          development, production and aseptic filling services for pharmaceutical
          microparticles (including microspheres and liposomes) manufacturing services,
          and other related services to customers therewith, and the goodwill appurtenant
          to such business and assets, but in all cases excluding (i) the business
          operations performed at the Princeton Property and (ii) the business operations
          of Seller, wherever located, Related exclusively to customers of Seller
          other
          than Buyer.

         

        “Business
          Confidential Information”
          means
          the Confidential Information of Seller except that “Business
          Confidential Information”
          does
          not include personnel information (other than that provided to Buyer pursuant
          to
          this Agreement), trade secrets, models, inventions,
          discoveries, the DMF
          numbered 16941 (Contract Manufacturing), advertising and marketing plans
          or
          systems, sales methods or systems, pricing lists and pricing formulae,
          customer
          and client lists, customer and client information (including principal
          contacts,
          addresses and telephone numbers) and related purchasing history, financial
          information and all documentation related to the foregoing. 

         

        “Business
          Documents, Systems and Information”means
          (i)
all
          written and electronic documentation Related to the Business including,
          but not
          limited to, the SOPs and all procedures, policies, manuals, methods, batch
          records, and other information used for the operation of the Business,
          (ii) all records with respect to distributors, suppliers and Buyer;
          (iii)
          all Information Technology, and (iv) all Business
          Confidential Information.

        

          “Business
            Day”
            means
            any calendar day which is not a Saturday, Sunday or public holiday under
            the
            laws of the State of New Jersey.

           

          “Buyer”
            is
            defined in the Introduction.

           

          “Buyer
            Officer’s Certificate”
            is
            defined in Section
            9.1.

           

          
            
              
              

            

            
              2

              
                

              

            

            
              
              

            

          

          “CERCLA”
            is
            defined in Section
            4.24.

           

          “Change
            Order”
            means
            the change order between the Parties pursuant to the Existing Manufacturing
            Agreement, originally dated February 16, 2005 and as amended from time
            to time.

           

          “Change
            Order No. 2”
            means
            the change order between the Parties pursuant to the Existing Manufacturing
            Agreement, dated October 4, 2005.

           

          “Charter
            Documents”
            means
            an entity’s certificate or articles of incorporation or formation, certificate
            defining the rights and preferences of securities, articles of organization,
            general or limited Seller agreement, operating agreement, certificate
            of limited
            Seller, joint venture agreement or similar document governing the
            entity.

           

          “Claim
            Notice”
            is
            defined in Section
            10.3(a).

           

          “Claim
            Response”
            is
            defined in Section
            10.3(a).

           

          “Closing”
            is
            defined in Section
            3.1.
            

           

          “Closing
            Consents”
            is
            defined in Section
            8.3.

           

          “Closing
            Date”
            is
            defined in Section
            3.1.
            

           

          “Code”
            means
            the U.S. Internal Revenue Code of 1986, as amended, and the rules and
            regulations thereunder.

           

          “Commercially
            Reasonable”
            means,
            with respect to arrangements made by, and performance of covenants of,
            a Party
            under this Agreement, means that such Party shall, if appropriate, incur
            expenses in the nature of processing fees (including legal review),
            administrative and other costs and expenses that are reasonable in amount,
            but
            such Party shall not be required to make any payment or offer or grant
            any
            financial accommodation or other benefit to any counterparty not otherwise
            provided under any applicable agreement between such Party and such
            counterparty, or release any claim or right under any such applicable
            agreement.

           

          “Confidential
            Information”means
            any
            confidential or proprietary information of Seller Related to the Business,
            including but not limited to, personnel information that Seller is not
            permitted
            to disclose pursuant to law and its existing privacy policies, correspondence
            and communications between Seller and the FDA or other Governmental Body,
            know-how, trade secrets, formulae, specifications, technical information,
            processes, models, inventions,
            discoveries, graphical and computer generated material,
            manuals,
            plans, designs, prototypes, drawings (including engineering and auto-cad
            drawings), proprietary information, the DMF numbered 17159, blue prints,
            data,
            databases, software, source codes, advertising and marketing plans or
            systems,
            distribution and sales methods or systems, pricing lists and pricing
            formulae,
            customer and client lists, customer, client, dealer, distributor, wholesaler
            and
            supplier information (including principal contacts, addresses and telephone
            numbers), purchasing history, financial information and all documentation
            related to the foregoing. Notwithstanding the foregoing, Confidential
            Information shall not include information (a) which was publicly known
            prior to
            the date of this Agreement or (b) that becomes publicly known
            without any
            act or omission by Seller.

           

          “Confidentiality
            Agreement”
            is
            defined in Section
            13.1.

           

          
            
              
              

            

            
              3

              
                

              

            

            
              
              

            

          

          “Consent
            to Assignment”
            means
            the Consent to Assignment and Assumption of Lease Agreement, by and between
            Seller, as tenant, and Buyer, as assignee, Safeguard, as guarantor, and
            consented to by the Landlord, substantially in the form of Exhibit
            F

           

          “Contingent
            Claim”
            is
            defined in Section
            10.8.
            

           

          “Contract”
            means
            any written or oral contract, agreement, purchase order, lease, instrument
            or
            other document, commitment, arrangement, or undertaking that is binding
            on any
            Person or its property under applicable Law. 

           

          “Court
            Order”
            means
            any judgment, decree, injunction, order or ruling of any federal, state,
            local
            or foreign court or governmental or regulatory body or authority that
            is binding
            on any Person or its property under applicable Law. 

           

          “Current
            Renovations”
            means
            the construction and alterations activities being conducted at the Totowa
            Property by Buyer pursuant to Change Order No. 2. 

           

          “Damages”
            is
            defined in Section
            10.1(a).

           

          “DAS
            Agreement”
            means
            the Supply Agreement dated May 31, 2002 (the “Agreement”)
            between Seller (as successor to Laureate Pharma L.P.) and DrugAbuse
            Pharmaceuticals, Inc. (as successor to Drug Abuse Sciences, Inc.) (“DAS”),
            including any subsequent agreements defining the relationship between
            Seller and
            DAS, including that certain Assignment, Amendment and Reaffirmation Agreement
            dated June 17, 2004. 

           

          “Default”
            means
            (i) a breach, default or violation, (ii) the occurrence of an event that
            with or
            without the passage of time or the giving of notice, or both, would constitute
            a
            breach, default or violation or (iii) with respect to any Contract, the
            occurrence of an event that with or without the passage of time or the
            giving of
            notice, or both, would give rise to a right of termination, renegotiation
            or
            acceleration. 

           

          “Disclosing
            Party”
            is
            defined in Section
            6.6(b).

           

          “DMFs”
            is
            defined in Section
            4.32.

           

          “Drug
            Establishment Registration”
            means a
            registration with the FDA under 21 C.F.R. Sec. 207.20 by an owner
            or
            operator of a drug establishment (as defined in 21 C.F.R. Sec.
            207.3).

           

          “Drug
            Master File”
            means a
            drug master file as described in 21
            C.F.R.
            Sec. 314.420.

           

          “Employee
            Lease”
            means
            that certain agreement, dated December 3, 2004, between Seller and the
            P.F.
            Laboratories, Inc., a New Jersey corporation, relating to the lease by
            Seller of
            unionized employees at the Totowa Property.

           

          “Employee
            Compensation List”
            is
            defined in Section
            4.16.

           

          “Encumbrances”
            means
            any lien, mortgage, security interest, pledge, restriction on transferability,
            defect of title or other claim, charge or encumbrance of any nature whatsoever
            on any property or property interest. 

           

          “Environmental
            Claims”
            is
            defined in Section
            4.24(i).
            

           

          “Environmental
            Laws”
            is
            defined in Section
            4.24(ii).

           

          
            
              
              

            

            
              4

              
                

              

            

            
              
              

            

          

          “Environmental
            Liability”
            means
            any and all liabilities, claims, costs, damages, losses, expenses, penalties,
            fines, attorneys’ fees, court costs and other costs incurred or imposed (a)
            pursuant to any order, notice of responsibility, injunction, judgment
            or similar
            act (including settlements) by any Governmental Body to the extent arising
            out
            of (i) Seller’s violation of Environmental Laws occurring at any property owned
            or operated by Seller prior to the Closing Date or (ii) the Previous
            Owner’s
            violation of Environmental Laws occurring at any property owned or operated
            by
            Previous Owner prior to December 3, 2004 or (b) pursuant to any claim
            or cause
            of action by a Governmental Body or other third Person for personal injury,
            property damage, or remediation costs to the extent arising out of or
            attributable to (i) Seller’s violation of, or Seller’s actions which result in a
            remedial obligation under, any Environmental Law occurring prior to the
            Closing
            Date or (ii) the Previous Owner’s violation of, or the Previous Owner’s actions
            which result in a remedial obligation under, any Environmental Law occurring
            prior to December 3, 2004.

           

          “Environmental
            Permit”
            is
            defined in Section
            4.24(iii).

           

          “ERISA”
            means
            the Employee Retirement Income Security Act of 1974, as amended, and
            all
            regulations and rules issued thereunder, or any successor law.

           

          “Exchange
            Act”
            means
            the Securities Exchange Act of 1934, as amended, and the rules and regulations
            thereunder.

           

          “Excluded
            Assets”
            is
            defined in Section
            2.1(b).

           

          “Excluded
            Equipment”
            is
            defined in Section
            2.1(b)(iii).

           

          “Existing
            Manufacturing Agreement”
            means
            the Technology Transfer and Manufacturing Agreement, dated October 3,
            2003,
            between the Parties, together with any amendments thereto following the
            date
            hereof.

           

          “Expiration
            Date”
            is
            defined in Section
            10.4(b).

           

          “FDA”
            is
            defined in Section
            4.32.

           

          “FDA
            Documents”
            is
            defined in Section
            4.32.
            

           

          “FDA
            Requirements”
            is
            defined in Section
            4.32.
            

           

          “FFDCA”
            is
            defined in Section
            4.32.
            

           

          “Fixed
            Assets
            is
            defined in Section
            4.28.

           

          “GAAP”
            means
            generally accepted accounting principles in the United States, consistently
            applied. 

           

          “Governmental
            Body”
            means
            any United States (a) federal, state, commonwealth, county, municipality,
            district or other jurisdiction of any nature, or any political subdivision
            thereof, (b) federal, state, local, municipal or other government or
            (c)
            governmental or quasi-governmental authority of any nature (including
            any
            governmental division, department, agency, commission, instrumentality,
            official, organization, regulatory body or other entity and any court,
            arbitrator or other tribunal).

           

          
            
              
              

            

            
              5

              
                

              

            

            
              
              

            

          

          “Governmental
            Permit”
            means
            any permit, license, registration, certificate of occupancy, approval,
            privilege, franchise, variance, exemption, consent or other authorization
            of any
            nature whatsoever, granted, approved or allowed by any Governmental Body.
            

           

          “Hazardous
            Material”
            is
            defined in Section
            4.24(iv).

           

          “Indemnified
            Buyer Party”
            is
            defined in Section
            10.1.

           

          “Indemnified
            Party”
            means
            an Indemnified Buyer Party or an Indemnified Seller Party. 

           

          “Indemnified
            Seller Party”
            is
            defined in Section
            10.2.
            

           

          “Indemnitor”
            is
            defined in Section
            10.3(a).

           

          “INDs”
            is
            defined in Section
            4.32.

           

          “Information
            Technology”
            means
            all communications systems and computer systems used or held for use
            in the
            conduct of the Business by Seller including all hardware, software, and
            URLs.

           

          “Insurance
            Claims List”
            is
            defined in Section
            4.20.

           

          “Inventory”
            means
            (i) all items purchased by Buyer and delivered to Seller under the Existing
            Manufacturing Agreement, wherever located, and (ii) the items that shall
            be the
            subject of the Inventory Payment at Closing, in each case as listed on
            Schedule
            1.1,
            which
            shall be updated by mutual agreement immediately prior to the
            Closing.

           

          “Inventory
            Payment”
            means
            the dollar amount payable for the items specified on Schedule
            1.1.

           

          “ISRA”
            is
            defined in Section
            4.24.

           

          “Knowledge
            of Buyer”
            means
            the actual knowledge of Robert J. Capetola, Ph.D., Christopher J. Schaber,
            Ph.D., John G. Cooper, David Lopez, Cynthia Davis and Jerry Orehostky,
            in each
            case, after reasonable investigation without any constructive or imputed
            knowledge of Buyer or any of its directors, officers or employees or
            owner.

           

          “Knowledge
            of Seller”
            means
            the actual knowledge of Robert J. Broeze, Mary-Joan Hampson-Carlin, Ernest
            Tyler, John Morris, Steven J. Grenfell, Steven J. Feder and Christopher
            J.
            Davis, in each case, after reasonable investigation without any constructive
            or
            imputed knowledge of Seller or any of its directors, officers or employees
            or
            owner.

           

          “Landlord”
            means
            Norwell Land Company, the landlord under the Totowa Lease.

           

          “Law”
            means
            any statute, law, ordinance, regulation, order, code or rule of any United
            States federal, state, or local governmental or regulatory body or authority,
            including those covering biopharmaceuticals,
            pharmaceuticals (including drugs, biologics, radiopharmaceuticals, and
            controlled substances), environmental,
            energy, safety, health, information technology, transportation, bribery,
            record
            keeping, zoning, antidiscrimination, antitrust, wage and hour, and price
            and
            wage control matters.

           

          “Legal
            Proceeding”
            means
            any action, lawsuit, litigation, arbitration, proceeding (including any
            civil,
            criminal, administrative, investigative, or appellate proceeding), hearing,
            inquiry, audit, examination or investigation commenced, brought, conducted,
            or
            heard by or before, or otherwise involving, any court or other Governmental
            Body
            or any arbitrator or arbitration panel.

           

          
            
              
              

            

            
              6

              
                

              

            

            
              
              

            

          

          “Liability”
            means
            any direct or indirect liability, indebtedness, obligation, expense,
            debt,
            claim, loss, damage, deficiency, guaranty or endorsement of any nature,
            of or by
            any Person, whether absolute or contingent, known or unknown, secured
            or
            unsecured, recourse or non-recourse, filed or unfiled, accrued or unaccrued,
            due
            or to become due, or liquidated or unliquidated.

           

          “Liquidated
            Claim Notice”
            is
            defined in Section
            10.3(a).

           

          “Litigation”
            means
            any action, lawsuit, arbitration, administrative or other proceeding
            (including
            any civil, criminal, investigative, or appellate proceeding), hearing,
            criminal
            prosecution or investigation or inquiry by any court or Governmental
            Body.

           

          “LNA”
            is
            defined in Section
            6.15.

           

          “Material
            Adverse Effect”
            means a
            material adverse effect on the business, Assets (including the Purchased
            Assets), operation or condition (financial or otherwise), results of
            operations
            of Seller as it Relates to the Business, consistent with past
            practice.

           

          “Milestone
            Payments”
            means
            the milestone payments aggregating $636,000 (consisting of payments in
            the
            amounts of $530,000 and $106,000 under the Change Order) that were to
            be paid
            upon written agreement of the quality committee that the facility, quality
            systems and Surfactant manufacturing process are ready for FDA re-inspection,
            which payments shall accelerate and become due and owing at the
            Closing.

           

          “Minor
            Contract”
            means
            (a) any Contract Relating to the Business that is terminable by a Party
            on not
            more than 30 days’ notice without any Liability, (b) any Contract Relating to
            the Business (other than Off-the-Shelf Software) under which the obligation
            of a
            Party (fulfilled and to be fulfilled) involves an amount of less than
            $5,000 and
            any group of similar Contracts under which the obligation of a Party
            (fulfilled
            and to be fulfilled) involves an amount of less than $10,000, and
            (c)
            any
            Off-the-Shelf Software.

           

          “NDAs”
            is
            defined in Section
            4.32.

           

          “NJDEP”
            means
            the New Jersey Department of Environmental Protection.

           

          “Non-Assignable
            Contract”
            is
            defined in Section
            2.4.

           

          “Non-Offeree
            Employee”
            is
            defined in Section
            6.5.

           

          “Non-Real
            Estate Leases”
            is
            defined in Section
            4.21.

           

          “Offeree
            Employee”
            is
            defined in Section
            6.5.

           

          “Off-the-Shelf
            Software”
            means
any
            software license implied by the sale of a product and perpetual, paid-up
            royalty
            free and transferable license rights for “off-the-shelf” third party application
            software licensed for use in the Business, in any individual case, under
            a
            license with a maximum payment obligation on the part of Seller of less
            than
            $3,000.

           

          “Ordinary
            course”
            or
“ordinary
            course of business”
            means
            the ordinary course of business that is consistent with past
            practices.

           

          “Parent
            Guaranty”
            means
            the guaranty by Safeguard of the obligations of Seller under this Agreement,
            in
            substantially the form of Exhibit
            E.

        

         

        
          
            
            

          

          
            7

            
              

            

          

          
            
            

          

        

        

          “Parties”
            is
            defined above in the Introduction.

           

          “Permitted
            Encumbrance”
            means
            (a) any Encumbrance disclosed on Schedule
            1.2;
            (b) any
            liens of mechanics, materialmen and laborers for work or services performed
            or
            materials furnished in connection with the Totowa Property, in each instance,
            which are not yet due and payable, including any such lien resulting
            from the
            activities being conducted by or for Buyer at the Totowa Property pursuant
            to
            Change Order No. 2 to the Existing Manufacturing Agreement prior to the
            Closing;
            (c) any rights reserved to or vested in any municipality or public authority
            to
            control or regulate the use of the Totowa Property or to use the Totowa
            Property
            in any manner; (d) any easements, rights-of-way, servitudes, restrictions
            and
            other minor defects, encumbrances and irregularities in title to the
            Totowa
            Property which could not, individually or in the aggregate, materially
            and
            adversely affect the value, condition, marketability or operation of
            the Totowa
            Property or the Totowa Lease or quiet enjoyment thereof; or (e) any
            Encumbrance for Taxes, assessments and other governmental charges that
            are not
            yet due and payable. 

           

          “Person”
            means
            any natural person, corporation, Seller, proprietorship, association,
            joint
            venture, trust or other legal entity.

           

          “PHSA”
            is
            defined in Section
            4.32.

           

          “Plans”
            is
            defined in Section
            4.22(a).

           

          “Previous
            Owner”
            means
            Purdue Pharma L.P., a Delaware limited partnership.

           

          “Prime
            Rate”
            means
            the prime lending rate as reported in The Wall Street Journal from time
            to time
            as the base rate on corporate loans.

           

          “Princeton
            Property”
            means
            Seller’s facility located at 201 College Road East, Princeton, New Jersey.

           

          “Purchased
            Assets”
            is
            defined in Section
            2.1(a).
            

           

          “Purchase
            Price”
            is
            defined in Section
            2.2(a).

           

          “Purchase
            Price Cap”
            is
            defined in Section
            10.4(a).

           

          “Qualified
            Offer”
            is
            defined in Section
            6.5.
            

           

          “Quality
            Agreement”
            means
            an agreement to be entered into on the Closing Date between Seller and
            Buyer,
            substantially in the form of Exhibit
            B-2
            relating
            to the arrangements of the supply of regulated products as set forth
            in the
            Transition Services Agreement.

           

          “Real
            Property”
            means
            all rights and interests of Seller in or to the Totowa Property. 

           

          “Related”
            means
            used or held for use in connection with the ownership, operation or maintenance
            of, arising from, or related to.

           

          “Response
            Period”
            is
            defined in Section
            10.3(a).

           

          “Safeguard”
            means
            Safeguard Scientifics, Inc., a Pennsylvania corporation, of which Seller
            is an
            indirect wholly-owned subsidiary.

           

          
            
              
              

            

            
              8

              
                

              

            

            
              
              

            

          

          “SEC”
            is
            defined in Section
            6.6(b).

          
             

            “Securities
              Act”
              means
              the Securities Act of 1933, as amended, and the rules and regulations
              thereunder.

             

            “Seller
              Contracts”
              is
              defined in Section
              4.15(a).

             

            “Seller
              Insurance”
              is
              defined in Section
              4.20.

             

            “Seller
              Officer’s Certificate”
              is
              defined in Section
              8.1.

             

            “Seller
              Required Consent”
              is
              defined in Section
              4.4.
              

             

            “SOPs”
              means
              the methods, processes, reports and standard operating procedures (collectively,
              the “SOPs”) of Seller used in the operation of the Business, including without
              limitation those listed on Schedule
              2.1(a)(iii).

             

            “Structures”
              means
              all buildings, structures, fixtures, facilities and improvements to
              any Real
              Property.

             

            “Taxes”
              shall
              mean all taxes, duties, charges, fees, levies or other assessment imposed
              by any
              taxing authority, including income, capital gains, gross revenue, profits,
              gross
              receipts, value-added, excise, withholding, personal property, real
              estate,
              sale, use, ad valorem, license, capital, lease, goods and services,
              severance,
              stamp, transfer, payroll, employment, customs, duties, alternative,
              add-on
              minimum, estimated and franchise taxes (including any interest, penalties
              or
              additions attributable to or imposed on or with respect to any such
              assessment,
              which shall be deemed to be Taxes for any taxable period with respect
              to which
              they shall arise, regardless of when they shall accrue or be
              payable.).

             

            “Tax
              Returns”
              means
              any and all returns, reports, claims for refund, information returns,
              or other
              statements (including elections, declarations, disclosures, schedules,
              estimates, and attachments), including estimates or amendments thereof,
              required
              to be filed by a Party with respect to any Taxes.

             

            “Termination
              Agreement”
              means
              the Termination Agreement, by and among Seller, Safeguard and The P.F.
              Laboratories, Inc., in substantially the form attached as Exhibit
              I.

             

            “Termination
              and Option Agreement”
              means
              that certain agreement, dated December 3, 2004, between Seller and
              Norwell Land
              Company relating to the parties’ respective rights and obligations under the
              Totowa Lease and relating to the Totowa Property.

             

            “Termination
              Date”
              is
              defined in Section
              11.1(b).

             

            “Third-Party
              Claim”
              is
              defined in Section
              10.5(a).
              

             

            “Threshold
              Amount”
              is
              defined in Section
              10.4(a).

             

            “Totowa
              Lease”
              means
              that certain lease, dated December 3, 2004, for the Totowa Property
              between
              Seller, as tenant, and the Norwell Land Company, as landlord. 

            “Totowa
              Property”
              means
              the facility leased by Seller consisting of approximately 21,000 square
              feet in
              a building located at 710 Union Boulevard, Totowa, New Jersey. 

            
               

              
                
                  
                  

                

                
                  9

                  
                    

                  

                

                
                  
                  

                

              

              “Trademarks”
                means
                any trademarks, service marks, brand names, certification marks,
                trade names,
                logos, trade dress, and all goodwill associated with the foregoing
                throughout
                the world and registrations in any jurisdictions of, and applications
                in any
                jurisdiction to register, the foregoing, including any extension,
                modification
                or renewal of any such registration or application.

               

              “Transaction
                Documents”
                means
                this Agreement, the Bill of Sale, Assignment and Assumption Agreement,
                the
                Transition Services Agreement, the Quality Agreement, the Consent
                to Assignment,
                the Assignment of Lease and Termination and Option Agreement, the
                Parent
                Guaranty, that certain letter agreement between the Parties, dated
                the date
                hereof, and any other certificate, instrument, agreement or document
                required to
                be delivered pursuant to the terms hereof and thereof.

              

              “Transactions”
                means
                the purchase and sale of the Purchased Assets and the transfer and
                assumption of
                the Assumed Liabilities at the Closing and the other transactions
                contemplated
                by the Transaction Documents.

               

              “Transferred
                Employees”
                is
                defined in Section
                6.5.

               

              “Transition
                Services Agreement”
                means
                an agreement to be entered into effective on the Closing Date between
                Seller and
                Buyer, substantially in the form of Exhibit
                B-1,
                relating to the provision by Seller of certain services following
                the
                Closing.

               

              “Unassumed
                Liability”
                is
                defined in Section
                2.3(b).

               

              “Unliquidated
                Claim”
                is
                defined in Section
                10.3(a).

               

              “Union”
                is
                defined in Section
                6.5(e).

               

              “Union
                Employees”
                means
                (i) employees of the Landlord who are members of the Union and provide
                services
                to Seller at the Totowa Property pursuant to the Employee Lease,
                and (ii)
                following the Closing, employees of Buyer who are members of the
                Union and who
                provide services to Buyer at the Totowa Property pursuant to an agreement
                between Buyer and the Union, as provided in Section
                6.5(e).

               

              “US”
                means
                the United States of America.

               

              “WARN
                Act”
                means
                the Worker Adjustment and Retraining Notification Act, as amended. 

               

              2.    Sale
                and Purchase.

               

              2.1    Agreement
                to Sell and Purchase.

               

              (a)    Subject
                to the satisfaction or waiver by the applicable Party prior to the
                Closing of
                the various conditions set forth in Section
                8
                and
Section
                9
                herein,
                at the Closing, Seller shall grant, sell, convey, assign, transfer
                and deliver
                to Buyer, and Buyer shall purchase from Seller, all right, title
                and interest of
                Seller in and to all of the Assets (other than the Excluded Assets)
                (the
“Purchased
                Assets”),
                free
                and clear of all Encumbrances (other than Permitted Encumbrances)
                as
                follows:

              (i)    all
                Inventory; 

               

              (ii)    all
                Fixed
                Assets (including all Structures), furniture, fixtures, leasehold
                improvements,
                tooling, machinery and equipment;

               

              
                
                  
                  

                

                
                  10

                  
                    

                  

                

                
                  
                  

                

              

              (iii)    all
                Business Documents, Systems and Information, including without limitation
                the
                SOPs; 

               

              (iv)    all
                telephone numbers and facsimile numbers currently used in the Business
                and
                identified on Schedule
                2.1(a)(iv);
                

               

              (v)    all
                manufacturing, warehouse and office supplies Related to the
                Business;

               

              (vi)    DMF
                numbered 17159; 

               

              (vii)   to
                the
                extent transferable, all Governmental Permits that are Related to
                the Business
                and have been issued to Seller or applied for by Seller and all rights
                thereunder; and

               

              (viii)   all
                Seller Contracts; and 

               

              (ix)    an
                assignment of Seller’s rights as tenant under the Totowa Lease and the
                Termination and Option Agreement.

               

              (b)    Notwithstanding
                the foregoing, the Purchased Assets shall not include any of the
                following (the
“Excluded
                Assets”):

               

              (i)    the
                seals, Charter Documents, minute books, Tax Returns, books of account
                or other
                records having to do with the organization of Seller;

               

              (ii)    the
                rights that accrue or will accrue to Seller under this Agreement;

               

              (iii)   the
                equipment set forth on Schedule
                2.1(b)(iii),
                as such
                Schedule may be modified from time to time (with the written consent
                of Buyer
                not to be unreasonably withheld) on or prior to the Closing Date
                (the
“Excluded
                Equipment”);
                

               

              (iv)   all
                trade
                names and abbreviations used by Seller whether or not in connection
                with the
                Business including “Laureate Pharma” and “Laureate”;

               

              (v)    claims,
                demands, causes of action, choses in action, rights of recovery,
                rights of
                set-off, rights to refunds and similar rights in favor of Seller
                or any
                Affiliate of Seller of any kind to the extent Relating to (a) the
                Excluded
                Assets or the Unassumed Liabilities, (b) the Existing Manufacturing
                Agreement or
                (c) the ownership of the Assets, or operation of the Business, prior
                to the
                Closing Date;

               

              (vi)   DMF
                numbered 16941;

               

              (vii)    all
                motor
                vehicles;

               

              (viii)   all
                cash
                and cash equivalents, including bank accounts, money market funds
                and temporary
                cash investments;

               

              (ix)    all
                of
                Seller’s and its Affiliates’ right, title and interest in and to all Accounts
                Receivable and all notes, bonds, and other evidences of indebtedness
                of and
                rights to receive payments arising out of sales, services, rentals
                and other
                business activities of Seller and its Affiliates, including with
                respect to the
                Business, and including all rights with respect to any third party
                collection
                procedures or any other actions or proceedings in connection
                therewith;

               

              
                
                  
                  

                

                
                  11

                  
                    

                  

                

                
                  
                  

                

              

              (x)    all
                rights to use SOPs included in Section
                2.1(a)(ix)
                that
                also relate to the operation of Seller’s business at the Princeton Property, as
                well as any SOP which was the basis for such an SOP or which was
                derived from
                such an SOP prior to the Closing Date;

               

              (xi)    any
                and
                all of Seller’s and its Affiliates’ rights arising under any outstanding
                receivable or payable between Seller, on the one hand, and any Affiliate
                of
                Seller, on the other hand;

               

              (xii)   Assets
                of
                Seller or its Affiliates that are located at or used in connection
                with Seller’s
                business operations conducted at the Princeton Property;

               

              (xiii)   all
                assets Related to any pension, profit sharing, stock bonus, stock
                option, thrift
                or other retirement plan, medical, hospitalization, dental, life,
                disability,
                vacation or other insurance or benefit plan, employee stock ownership
                plan,
                deferred compensation, stock ownership, stock purchase, bonus, benefit
                or other
                incentive plan, severance plan or other similar plan relating to
                Seller, its
                Affiliates or their respective employees;

               

              (xiv)   all
                rights, titles, claims and interests of Seller or its Affiliates
                under any
                policy or agreement of insurance or under any bond;

               

              (xv)    (A)
                all
                Trademarks, (B) all rights to intellectual property owned by customers
                of Seller
                other than Buyer, and (C) all rights to intellectual property owned
                or otherwise
                used by Seller exclusively with respect to customers of Seller other
                than
                Buyer;

               

              (xvi)   all
                rights Related to the prepaid expenses identified on Schedule
                2.1(b)(xvi)
                that
                accrue or are paid by Seller prior to the Closing;

               

              (xvii)   all
                rights or claims by any Seller or any Affiliate of any Seller to
                (a) any Tax
                refund relating to the period prior to the Closing Date; 

               

              (xviii)   the
                Employee Lease; and

               

              (xix)    the
                Assets specified on Schedule
                2.1(b)(xix).

               

              2.2    Purchase
                Price.
                In
                consideration of the grant, sale, conveyance, assignment, transfer
                and delivery
                of the Purchased Assets to Buyer and the assumption by Buyer of the
                Assumed
                Liabilities, Buyer shall pay a total amount (the “Purchase
                Price”)
                equal
                to Sixteen Million Dollars ($16,000,000). Buyer shall pay the Purchase
                Price at
                the Closing by a wire transfer of immediately available funds, in
                accordance
                with written instructions provided by Seller to Buyer prior to the
                Closing Date.

               

              2.3    Assumption
                of Liabilities.

               

              (a)    At
                the
                Closing, Buyer shall assume and agree to pay, discharge or perform,
                as
                appropriate, when due only the Liabilities of Seller specifically
                identified
                below in this subsection (a) (the “Assumed
                Liabilities”):

               

              (i)    all
                Liabilities set forth on Schedule
                2.3(a),
                to the
                extent that such Liabilities accrue, are caused by, arise out of,
                are associated
                with, are in respect of, or are incurred, in each case, at any time
                on and after
                the Closing Date in connection with the Purchased Assets and the
                ownership or
                operation of the Purchased Assets after the Closing Date (to the
                extent that
                such Liabilities are
                not
                overdue or delinquent on the Closing Date, without regard to any
                grace period
                and without incurring any increase in the amounts due); 

               

              
                
                  
                  

                

                
                  12

                  
                    

                  

                

                
                  
                  

                

              

              (ii)    all
                Liabilities expressly assumed by Buyer under Section
                7.3
                of this
                Agreement; and

               

              (iii)   all
                Liabilities relating to the ownership of the Purchased Assets from
                and after the
                Closing Date and the conduct by Buyer of its business after the Closing
                Date.

               

              (b)    Notwithstanding
                subsection (a) above or any other provision of this Agreement, Buyer
                is not
                assuming under this Agreement or any other Transaction Document,
                and Seller
                shall continue to be responsible for, any Liability (each, an “Unassumed
                Liability”)
                that
                is not specifically identified as an Assumed Liability under subsection
                (a)
                above, including, without limitation, any of the following: (i) except
                as may
                otherwise be provided under the Existing Manufacturing Agreement,
                any product or
                service liability or similar claim for injury to any Person or property,
                regardless of when made or asserted, that arises out of or is based
                upon any
                alleged action or failure to act by Seller or any express or implied
                representation, warranty, agreement or guarantee made by Seller,
                or alleged to
                have been made by Seller, or that is imposed or asserted to be imposed
                by
                operation of law or otherwise in connection with any service performed
                or
                product sold or leased by or on behalf of Seller on or prior to the
                Closing,
                whether or not billed as of the Closing Date; (ii) (A) any Taxes
                of Seller or
                (B) except as otherwise provided in Section
                7.3(c)
                (relating to property Taxes), any Tax payable with respect to the
                Business, the
                Purchased Assets and the performance by Seller of its obligations
                under the
                Existing Manufacturing Agreement (except as may otherwise be provided
                therein)
                with respect to any period or portion thereof ending on or before
                the Closing
                Date; (iii) any Liabilities under or in connection with any Excluded
                Assets;
                (iv) any Liabilities of Seller arising or incurred in connection
                with Seller’s
                performance or failure to perform under any agreement with any customer
                of
                Seller other than Buyer; (v) any Liabilities arising prior to the
                Closing Date
                or as a result of the Closing relating to Seller’s employment of Persons,
                including Liabilities, if any, with respect to any employee wages,
                salaries,
                benefits or withholding taxes, the Plans or other pension plan, supplemental
                savings plan, any workers compensation claim or any other Liability
                of Seller to
                or with respect to its respective employees relating in any way to
                their
                employment by Seller; (vi) any Liabilities of Seller arising or incurred
                in
                connection with the negotiation, preparation and execution of this
                Agreement and
                the Transactions; (vii) any Environmental Liability arising prior
                to the Closing
                or relating to the conduct of the Business prior to the Closing;
                (viii)
                Liabilities arising from or related to governmental fines or penalties
                arising
                out of or based upon Seller’s actions or failure to act or the conduct of the
                Business or otherwise incurred by Seller, in each case during any
                period prior
                to the Closing Date; (ix) any Liabilities for money borrowed or pursuant
                to any
                financing agreement or arrangement, whether direct or contingent;
                (x) any
                Liability of Seller owing to any of its Affiliates; (xi) any Liabilities
                arising
                prior to the Closing Date or as a result of Seller’s activities in connection
                with the Closing relating to the infringement, misappropriation,
                trademark
                dilution or other violation of the confidential information, proprietary
                information or intellectual property of any Person other than Buyer;
                and (xii)
                any other Liabilities (including any lease agreement) regardless
                of when made or
                asserted, that are not specifically assumed by Buyer under this
                Agreement.

               

              2.4    Consent
                of Third Parties.
                Nothing
                in this Agreement shall be construed as an attempt by Seller to assign
                to Buyer
                pursuant to this Agreement any Seller Contract, permit, franchise,
                claim or
                Asset included in the Purchased Assets that is by its terms expressly
                or
                implicitly or by law nonassignable without the consent of any other
                party or
                parties, unless such consent or approval shall have been given, or
                as to which
                all the remedies for the enforcement thereof available to Seller
                would not by
                law pass to Buyer as an incident of the assignments provided for
                by this
                Agreement (a “Non-Assignable
                Contract”).
                To
                the extent that any Seller Required Consent in respect of, or a novation
                of, a
                Non-Assignable Contract shall not have been obtained on or before
                the Closing
                Date, Seller shall at its sole expense continue to use its Commercially
                Reasonable efforts to obtain any such Seller Required Consent or
                novation after
                the Closing Date until such time as it shall have been obtained,
                and Seller
                shall cooperate with Buyer in any Commercially Reasonable arrangement
                to provide
                that Buyer shall receive the interest of Seller in the benefits under
                each such
                Non-Assignable Contract, including performance, to the extent permitted
                by
                applicable Law, by Seller as agent if Commercially Reasonable; provided
                that, so
                long as Seller shall provide to Buyer substantially all the benefits
                of each
                such Non-Assignable Contracts, Buyer shall undertake to pay or satisfy
                the
                corresponding Liabilities under the terms of each such Non-Assignable
                Contract
                (or such lesser amount corresponding to the value of benefits actually
                provided
                to Buyer by Seller with respect to such Non-Assignable Contract)
                to the extent
                that Buyer would have been responsible therefor if such consent or
                approval had
                been obtained. Nothing contained in this Section
                2.4
                or
                elsewhere in this Agreement shall be deemed a waiver by Buyer of
                its right to
                have received on the Closing Date an effective assignment of all
                of the
                Purchased Assets or of the covenant of Seller to obtain all of Seller
                Required
                Consents, nor shall this Section
                2.4
                or any
                other provision of this Agreement be deemed to constitute an agreement
                to
                exclude from the Purchased Assets any Contracts as to which a Seller
                Required
                Consent may be necessary.

               

              
                
                  
                  

                

                
                  13

                  
                    

                  

                

                
                  
                  

                

              

              3.    Closing.

               

              3.1    Location;
                Date.
                The
                closing for the Transactions (the “Closing”)
                shall
                be held at the offices of Morgan, Lewis & Bockius LLP in Philadelphia,
                Pennsylvania, on a date which shall be no more than three Business
                Days after
                satisfaction or waiver of the conditions set forth in Section
                8
                and
Section
                9,
                or at
                such other date and place as may be mutually agreed by the parties
                (the
“Closing
                Date”).

               

              3.2    Deliveries.
                At the
                Closing, subject to the satisfaction of the conditions set forth
                in Section
                8
                or
Section
                9,
                as
                applicable, 

               

              (a)    Seller
                shall deliver, or cause to be delivered, to Buyer:

               

              (i)    duly
                executed counterparts to the Transaction Documents to which each
                of Seller,
                Safeguard and the Landlord are parties;

               

              (ii)    true
                and
                complete copies of the duly executed Ancillary Agreements, certified
                by an
                executive officer of Seller;

               

              (iii)   an
                updated Employee Compensation List, if necessary, to show changes
                to the
                information contained in the Employee Compensation List dated as
                of December 27,
                2005;

               

              (iv)   an
                opinion of Seller’s Counsel in substantially the form set forth on Exhibit
                D;
                

               

              (v)    a
                non-foreign certification (in form and substance reasonably satisfactory
                to
                Buyer) that satisfies the requirements of Treasury Regulation section
                1.1445-2(b)(2);

               

              (vi)    Closing
                Consents in such forms as are reasonably acceptable to Buyer and
                any other
                Seller Required Consent that Seller receives on or prior to the Closing;
                

               

              (vii)    a
                copy of
                the duly executed Notice related to Drug Establishment Registrations
                for Totowa
                Property in substantially the form set forth on Exhibit
                C-3
                that
                will be transmitted by Seller on the Closing Date for filing with
                the FDA
                pursuant to Section
                7.4;
                

               

              
                
                  
                  

                

                
                  14

                  
                    

                  

                

                
                  
                  

                

              

              (viii)   such
                applications and notices (in such forms as are reasonably acceptable
                to Buyer)
                that will be filed by Seller on or, as may be reasonably practicable,
                following
                the Closing Date with respect to those Governmental Permits that
                are being
                transferred to Buyer pursuant to Section
                2.1(a)(vii);
                

               

              (ix)    administrative
                passwords for all Purchased Assets, as applicable; 

               

              (x)    copies
                of
                all Business Documents, Systems and Information, including without
                limitation,
                the SOP’s;

               

              (xi)    termination
                statements or other evidence (in a form reasonably acceptable to
                Buyer) that any
                liens identified on Schedule
                4.11
                have
                been released;

               

              (xii)    if
                in
                Seller’s possession, the LNA with respect to the Transactions from the NJDEP;
                and

               

              (xiii)    such
                other instruments of conveyance and transfer, in form reasonably
                satisfactory to
                Buyer and its counsel, as shall be necessary and effective to transfer
                and
                assign to, and vest in, Buyer all of Seller’s right, title and interest in and
                to the Purchased Assets. 

               

              With
                respect to the items contemplated by clause (x) above, Buyer acknowledges
                that
                such items are maintained at the Totowa Property and, as such, shall
                be deemed
                delivered at the Closing.

               

              (b)    Buyer
                shall deliver to Seller:

               

              (i)    duly
                executed counterparts to the Transaction Documents to which it is
                a party;
                and

               

              (ii)    such
                other documents, instruments, certificates and agreements as may
                be reasonably
                required by Seller to consummate and give effect to the
                Transactions.

               

              (c)    Buyer
                shall deliver the Purchase Price to Seller in accordance with Section
                2.2.

               

              (d)    Buyer
                shall deliver the Inventory Payment.

               

              (e)    Buyer
                shall deliver the Milestone Payments.

               

              (f)    Buyer
                shall deliver, if applicable, Buyer’s pro rated portion of any property tax
                prepaid by Seller with respect to the period up to and including
                the Closing
                Date.

               

              Each
                of
                the payments contemplated to be delivered at the Closing by Buyer
                shall be made
                by wire transfer of immediately available funds in accordance with
                instructions
                provided by Seller to Buyer prior to the Closing Date.

              

              4.    Representations
                and Warranties of Seller.
                Seller
                hereby represents and warrants to Buyer as follows with respect to
                the Purchased
                Assets and the Business; provided, however, that the Parties acknowledge
                and
                agree that (i) only the provisions of the Existing Manufacturing
                Agreement shall
                govern the performance by Seller of its obligations under the Existing
                Manufacturing Agreement, such that no right of indemnification under
                this
                Agreement shall arise in connection with any breach of any representation
                or
                warranty under the Existing Manufacturing Agreement or any Default
                by Seller in
                the performance of its obligations under the Existing Manufacturing
                Agreement,
                and (ii) nothing in this Agreement shall have the effect of expanding
                or
                otherwise modifying the rights and obligations of the Parties under
                the Existing
                Manufacturing Agreement. 

               

              
                
                  
                  

                

                
                  15

                  
                    

                  

                

                
                  
                  

                

              

              4.1    Organization
                and Standing.
                Seller
                is a corporation duly organized, validly existing and in good standing
                under the
                laws of the State of Delaware and is duly qualified to do business
                as a foreign
                corporation in the State of New Jersey, which is the only jurisdiction
                where the
                Business or the ownership of the Purchased Assets requires it to
                be so
                qualified, except for failures to be so qualified that would not
                reasonably be
                expected to have a Material Adverse Effect. During the four years
                immediately
                preceding the date of this Agreement, Seller has conducted business,
                and its
                Assets have been held, only under the names of Laureate Pharma, Inc.,
                Bard
                Biopharma, LP and Biopharma Acquisition Corp., each of which was
                organized under
                the laws of the State of Delaware.

               

              4.2    [Reserved]
                

               

              4.3    Authority
                and Binding Effect.
                Seller
                has the full power and authority to (i) own the Purchased Assets,
                (ii) carry on
                the Business as presently conducted, (iii) execute and deliver each
                Transaction
                Document to which it is or will be a party, (iv) perform the Transactions
                performed or to be performed by it pursuant to the terms of the Transaction
                Documents and (v) satisfy or perform, as the case may be, its obligations
                under
                those Transaction Documents to which it is a party. The execution,
                delivery and
                performance by Seller of the Transaction Documents to which it is
                a party have
                been duly authorized by all necessary corporate action. Assuming
                due
                authorization, execution and delivery by Buyer, this Agreement constitutes
                a
                valid and binding obligation of Seller, enforceable against Seller
                in accordance
                with its terms.

               

              4.4    Consents
                and Approvals.
                Except
                for any notices, filings, consents, approvals, permits, licenses
                or
                authorization of, or registration, declaration or filing with, any
                third party
                or court or Governmental Body specified in Schedule
                4.4
                (the
“Seller
                Required Consents”),
                neither the execution and delivery by Seller of any of the Transaction
                Documents
                to which it is a party, nor the performance of the Transactions performed
                or to
                be performed by Seller under the Transaction Documents, require any
                notice,
                filing, consent, approval, permit, license or authorization of, or
                registration,
                declaration or filing with, or renegotiation with any third party
                or court or
                Governmental Body, constitute a Default under, cause any payment
                obligation to
                arise or give any Person the right to challenge any of the Transactions
                under
                (i) any Law or Court Order which is applicable to Seller, (ii) any
                Contract,
                Governmental Permit or other document to which Seller is a party
                or by which the
                properties or other assets of Seller, including the Purchased Assets,
                may be
                bound or (iii) except as have already been obtained, the Charter
                Documents of
                Seller.

               

              4.5    [Reserved]
                

               

              4.6    [Reserved]
                

               

              4.7    Taxes.
                

               

              (a)    Seller
                has filed all Tax Returns that it was required to file and all such
                Tax Returns
                are current and complete in all material respects. All material Taxes
                owed by
                Seller (whether or not shown on any Tax Return) have been paid. Seller
                is not
                currently the beneficiary of any extension of time within which to
                file any Tax
                Return. There are no ongoing examinations or claims against Seller
                for Taxes
                with respect to or affecting the Purchased Assets or the Business,
                and no
                written notice of any audit, examination or claim for Taxes or any
                dispute with
                respect to or affecting the Purchased Assets or the Business, whether
                pending or
                threatened, has been received by Seller.

               

              
                
                  
                  

                

                
                  16

                  
                    

                  

                

                
                  
                  

                

              

              (b)    Seller
                has withheld and paid over or will pay over to the proper taxing
                authorities all
                Taxes required to have been withheld and paid over with respect to
                or affecting
                the Purchased Assets and the Business, including, without limitation,
                all
                employer contributions and premiums, withholding taxes and social
                security and
                unemployment Taxes and premiums, required to be remitted to all taxing
                authorities, and complied with all information reporting and backup
                withholding
                requirements, including maintenance of required records with respect
                thereto.

               

              (c)    There
                are
                (and as of immediately before the Closing there will be) no Encumbrances
                (other
                than Permitted Encumbrances) on the Purchased Assets of Seller relating
                to or
                attributable to Taxes and no current Liability for any Taxes due
                and payable in
                connection with the Business and the Purchased Assets.

               

              (d)    Schedule
                4.7(d)
                lists
                all federal, state, local, and foreign jurisdictions in which Seller
                has filed
                Tax Returns with respect the Business.

               

              (e)    No
                written claim that remains unresolved has ever been made by any Governmental
                Body in a jurisdiction where Seller does not file a Tax Return that
                the Business
                may be subject to taxation by that jurisdiction or that Tax Returns
                must be
                filed with regard to the Business in such jurisdiction. Seller has
                not waived
                any statute of limitations in respect of Taxes or agreed to any extension
                of
                time with respect to a Tax Assessment or deficiency.

               

              (f)    None
                of
                the Purchased Assets (i) is tax-exempt use property within the meaning
                of
                Section 168(h) of the Code, (ii) directly or indirectly secures any
                debt, the
                interest on which is exempt under Section 103(a) of the Code, or
                (iii) is
                property that is required to be treated as being owned by any Person
                (other than
                Seller) pursuant to the provisions of Section 168(f)(8) of the Internal
                Revenue
                Code of 1954, as amended, and in effect immediately before the enactment
                of the
                Tax Reform Act of 1986.

               

              (g)    Seller
                has not received any written notice of any special tax assessment
                affecting the
                Totowa Property or Seller’s obligations under the Totowa Lease and, to the
                Knowledge of Seller, no such assessment is pending or threatened.

               

              (h)    Seller
                has not made, and is not obligated to make, and is not a party to
                any agreement
                that under certain circumstances could obligate it to make, any payment
                to any
                Person involved in the Business that will not be deductible under
§280G of the
                Code.

               

              4.8    [Reserved]
                

               

              4.9    [Reserved]
                

               

              4.10   Inventory.
                Except
                as described in Schedule
                4.10,
                the
                Inventory to be included in the Purchased Assets will consist of
                items of good,
                usable and merchantable quality usable in the ordinary course of
                business. None
                of the Inventory is damaged or obsolete. Seller has valued the Inventory
                in
                accordance with U.S. generally accepted accounting principles at
                the lower of
                cost, calculated on a first-in, first-out basis, or market value.
                All Inventory
                not owned by Buyer is owned by Seller and no Inventory has been consigned
                to
                Seller.

               

              4.11   Title
                to Purchased Assets and Related Matters.
                Except
                as otherwise set forth on Schedule
                4.11,
                Seller
                has good and marketable title to, valid leasehold interest in or
                valid licenses
                to use, as applicable, all the Purchased Assets, free from any Encumbrances
                (other than Permitted Encumbrances). The use of the Purchased Assets
                is not
                subject to any Encumbrances (other than Permitted Encumbrances),
                and such use
                does not encroach on the property or the rights of any Person. 

               

              
                
                  
                  

                

                
                  17

                  
                    

                  

                

                
                  
                  

                

              

              4.12    Condition
                of Purchased Assets.
                Except
                as set forth on Schedule
                4.12,
                the
                equipment and all other tangible assets and properties which are
                part of the
                Purchased Assets are in good operating condition and repair, normal
                wear and
                tear excepted, and are usable in the ordinary course of the Business
                and conform
                in all material respects to all applicable Laws relating to their
                use and
                operation as such Purchased Assets are currently used in the conduct
                of the
                Business. Except for Purchased Assets held pursuant to the Non-Real
                Estate
                Leases described on Schedule
                4.21
                and the
                Excluded Equipment, no Person other than Laureate owns any Fixed
                Assets or other
                tangible Assets situated on the Totowa Property. Seller confirms
                that there are
                no Assets of Seller located at the Totowa Property that are not Purchased
                Assets. Except for (i) the Excluded Assets, (ii) the services provided
                by the
                Union Employees under the Employee Lease and the Non-Offeree Employees,
                (iii)
                the services to be provided by Seller after the Closing pursuant
                to the
                Transition Services Agreement and assuming the replenishment of Inventory
                in the
                ordinary course of the Business, the Purchased Assets are sufficient
                to enable
                Buyer to conduct its operations after the Closing in all respects
                as Seller
                conducted its operations of the Business prior to commencement of
                the Current
                Renovations.

               

              4.13    Real
                Property.
                The
                Totowa Property is in good condition, ordinary wear and tear excepted.
                Seller
                has peaceful, undisturbed and exclusive possession of the leasehold
                estate
                created under the Totowa Lease, and other than the Termination and
                Option
                Agreement and the Employee Lease, there are no leases, subleases,
                licenses,
                concessions, or other Contracts granting to any other Person the
                right to use or
                occupy the Totowa Property. Seller has not mortgaged or otherwise
                encumbered the
                Totowa Lease and, to the Knowledge of Seller, there are no Encumbrances
                that
                would adversely affect the use and occupancy of the Totowa Property.
                Except as
                set forth on Schedule
                4.13,
                the
                Totowa Lease is valid and in full force and effect and, other than
                with respect
                to the 483 Letter received January 21, 2005 and related correspondence,
                copies
                of which have been provided to Buyer, (i) Seller is not, and to the
                Knowledge of
                Seller, the Landlord is not, in Default under the Totowa Lease or
                any Contract
                or Law with respect to the occupancy, maintenance or use of the Totowa
                Property,
                (ii) no notice or threat from any landlord, Governmental Body or
                other Person
                has been received by Seller or served upon the Totowa Property claiming
                any
                Default or obligation under the Totowa Lease or any Contract or Law,
                or
                requiring or calling attention to the need for any work, repairs,
                construction,
                alteration, installations or environmental remediation, or otherwise
                indicating
                that there is pending or anticipated any action of the landlord,
                such
                Governmental Body or other Person that would adversely affect the
                Totowa
                Property or the ability of Buyer to conduct its manufacturing activities
                following the Closing, (iii) there does not exist any event or condition
                that is
                likely to result in a Default under the Totowa Lease by Seller or,
                to the
                Knowledge of Seller, by the Landlord, and (iv) all security deposits
                required to
                be made by Seller under the Totowa Lease have been made by Seller
                and no portion
                of such security deposits has been applied to cure any prior Default
                by Seller
                under the Totowa Lease. The Totowa Lease has not been assigned, modified,
                supplemented or amended. To the Knowledge of Seller, no Legal Proceedings
                are
                pending which would affect the zoning or use of the Totowa Property.
                No portion
                of the Totowa Property is within an identified flood plain or other
                designated
                flood hazard area as established under any Law or otherwise by any
                governmental
                authority. The Totowa Property has direct legal access to, abuts,
                and is served
                by a publicly maintained road, which road does and shall provide
                a valid means
                of ingress and egress thereto and therefrom, without additional expense.
                All
                utilities, including water, gas, telephone, electricity, sanitary
                and storm
                sewers, are currently available to the Totowa Property at normal
                and customary
                rates, and are adequate to serve the Business as currently conducted
                and
                Seller’s current use of the Totowa Property. There are no claims or Legal
                Proceedings which are pending against Seller, or, to the Knowledge
                of Seller,
                pending or threatened against the Landlord or the owner of the Totowa
                Property,
                which could reasonably be expected to affect the continued use of
                the Totowa
                Property in substantially the same manner as presently used by
                Seller.

               

            

            
              
                
                

              

              
                18

                
                  

                

              

              
                
                

              

            

            

              4.14    Intellectual
                Property.
                

               

              (a)    Contracts.

               

              (i)    Schedule
                4.14(a)(i)(A)
                contains
                a complete and accurate list of all Contracts relating to the Confidential
                Information in
                written form, except for Minor Contracts. Except as specified on
Schedule
                4.14(a)(i)(B),
                Seller
                is
                not currently engaged in any dispute or disagreement with respect
                to any such
                Contract nor,
                to the
                Knowledge of Seller,
                are
                there any
                threatened disputes or disagreements with respect to any such Contracts.
                Except
                for any rights under written
                licenses or written Contracts
                set
                forth in Schedule
                4.14(a)(i)(C),
                no
                current or former employee of Seller (including any current or former
                Union
                Employee under the Employee Lease) owns or has any interest in any
                Business
                Confidential Information or Information Technology.

               

              (ii)    To
                the
                Knowledge of Seller, Schedule
                4.14(a)(ii)(A)
                contains
                a complete and accurate list of all Contracts relating to the Confidential
                Information that are not in written form, except for Minor Contracts,
                and an
                accurate summary description of all material terms of all such Contracts.
                Except
                as specified on Schedule
                4.14(a)(ii)(B),
                Seller
                is not currently engaged in any dispute or disagreement
                with respect to any such Contract nor,
                to the
                Knowledge of Seller, are
                there
                any threatened
                disputes or disagreements with respect to any such non-written
                Contracts.

               

              (b)    Seller
                has made available to Buyer complete and correct copies of all written
                Contracts, together with all amendments, supplements or modifications
                thereto,
                as required to be set forth on Schedule
                4.14(a)(i)A.

               

              (c)    Business
                Confidential Information.
                

               

              (i)    The
                Business Confidential Information constitutes all of the Confidential
                Information that has been used or held for use, or relied upon by
                Seller in the
                Business. Seller has not transferred ownership of, nor granted any
                exclusive
                license with respect to, any Business Confidential Information to
                any other
                Person. Except as set forth on Schedule
                4.14(c)(i)(A),
                Seller
                is the owner of all right, title and interest in and to, or has licensed,
                with
                full power to transfer and assign to Buyer,
                free and
                clear of any Encumbrances, each item comprising the Business Confidential
                Information and has the right to bring actions for infringement,
                misappropriation or other violation thereof. Schedule
                4.14(c)(i)(B)
                contains
                a complete and accurate list of all payments due to a third party
                for any
                licensed Business Confidential Information. All Business Confidential
                Information is fully transferable and alienable to Buyer without
                payment of any
                kind to any other Person; however, all Business Confidential Information
                described in those Contracts listed on Schedule
                4.4,
                is
                fully transferable and alienable to Buyer without payment of any
                kind to any
                other Person in accordance with its terms. The documentation relating
                to all
                Business Confidential Information is current, accurate, and sufficient
                in detail
                and content to identify and explain it to an individual having appropriate
                education and experience and to allow its full and proper use by
                an
                individual having appropriate education and experience without
                reliance on the knowledge or memory of any other
                individual.
                Seller has used reasonable efforts to maintain the confidentiality
                of its
                Confidential Information. Except
                as
                set forth in Schedule
                4.14(c)(i)(C),
                all
Business
                Confidential Information is not part of the public knowledge or literature,
                and,
                has not been used, divulged, or appropriated by Seller to the detriment
                of the
                Business. Seller
                is
                not currently engaged in any dispute or disagreement with respect
                to
                any Business
                Confidential Information nor,
                to
the
                Knowledge of Seller, are there any
                threatened disputes or disagreements
                regarding the
                Business Confidential Information. 

               

              (ii)    No
                Business Confidential Information is, to the Knowledge of Seller,
                subject to any
                proceeding or outstanding order or stipulation, (other than any license
                agreement to Seller), restricting in any manner the use, transfer,
                assignment or
                licensing thereof to Buyer, or which may adversely affect the validity,
                use or
                enforceability of such Business Confidential Information. Each item
                of Business
                Confidential Information is valid, subsisting, and enforceable and
                any
                maintenance and renewal fees due in connection with such Business
                Confidential
                Information have been made.

               

              
                
                  
                  

                

                
                  19

                  
                    

                  

                

                
                  
                  

                

              

              (iii)   Except
                as
                set forth in Schedule
                4.14(c)(iii)(A),
                the
                Business, including, without limitation, the business processes of
                the Business,
                does not, and, to the Knowledge of Seller, has not been alleged to,
                infringe
                upon, misappropriate, dilute (with respect to trademarks only), or
                otherwise
                violate any confidential or proprietary information or intellectual
                property
                owned by any other Person. Except as set forth in Schedule
                4.14(c)(iii)(B),
                no
                written notice or claim has been received by Seller asserting that
                the Business,
                including, without limitation, the business processes of the Business,
                infringes
                upon, misappropriates or otherwise violates any confidential information,
                proprietary information, or any intellectual property owned or controlled
                by any
                other Person. 

               

              (iv)    Except
                as
                specified on Schedule
                4.14(c)(iv)(A),
                Seller
                has not been informed in writing that any Person is infringing, misappropriating
                or otherwise violating or challenging or threatening in any way,
                any Business
                Confidential Information. To the Knowledge of Seller, Seller has
                not received
                any unwritten or verbal notification that any Person is infringing,
                misappropriating or otherwise violating or challenging or threatening
                in any
                way, any Business Confidential Information. Except as specified on
Schedule
                4.14(c)(iv)(B),
                Seller
                has not given any indemnification rights, other than those provided
                under the
                Uniform Commercial Code or any equivalent thereof, to any other Person
                against
                infringement, misappropriation or other violation of any confidential
                information of a third party.

               

              (v)    All
                Information Technology necessary to the present operation of the
                Business is
                owned by Seller, free and clear of any Encumbrances, or is leased
                or licensed by
                Seller, with full power to transfer and assign such Information Technology
                to
                Buyer. 

               

              (vi)   All
                Off-the-Shelf Software necessary to the operation of the Business
                as of the
                Closing have been licensed (including shrink-wrap and click-wrap
                licenses) by
                Seller. 

               

              4.15    Contracts.

               

              (a)    Schedule
                4.15
                lists
                all Contracts Related to the Business to which Seller is a party
                or by which it
                is bound, whether written or oral, except for (i) Minor Contracts,
                (ii)
                Contracts that are Excluded Assets and (iii) Contracts that relate
                to Unassumed
                Liabilities. The Contracts listed in Schedule
                4.15
                and the
                Minor Contracts excluded from Schedule
                4.15
                are
                referred to in this Agreement as the “Seller
                Contracts.”

               

              (b)    Except
                as
                described on Schedule
                4.15,
                Seller
                has made available to Buyer complete and correct copies of all written
                Seller
                Contracts, together with all amendments, supplements or modifications
                thereto,
                and accurate summary descriptions of all material terms of all oral
                Seller
                Contracts (other than Minor Contracts), as set forth or required
                to be set forth
                on Schedule
                4.15.

               

              (c)    The
                Seller Contracts (as such may be modified through the Closing) constitute
                all of
                the Purchased Assets that are Contracts. Each of the Seller Contracts
                is legal,
                valid and binding upon Seller, enforceable against Seller in accordance
                with its
                terms. Seller is not in Default under any Seller Contracts (including
                any Seller
                Contracts that are leases). Seller has not received any communication
                from, or
                given any communication to, any other party indicating that Seller
                or such other
                party, as the case may be, is in Default under any Seller Contract.
                To the
                Knowledge of Seller, (i) none of the other parties to any such Seller
                Contract
                is in Default thereunder and (ii) each such Seller Contract is enforceable
                against any other parties thereto in accordance with the terms thereof.
                There
                are no renegotiations of (x) any amounts paid or payable to Seller
                under any
                current Seller Contract or (y) any material term or condition of
                any current
                Seller Contract, in each case, with any Person having the contractual
                or
                statutory right to demand or require such renegotiation and, to the
                Knowledge of
                Seller, no such Person has made any demand for such negotiation.
                Seller has not
                received written notice that any party to any Seller Contract intends
                to cancel
                or terminate any Seller Contract.

               

              
                
                  
                  

                

                
                  20

                  
                    

                  

                

                
                  
                  

                

              

              4.16    Employees/Independent
                Contractors.
                Except
                as
                set forth on Schedule
                4.16,
                Seller
                is not (a) a party to, involved in or, to the Knowledge of Seller,
                threatened
                by, any labor dispute,
                strike, work stoppage
                or
                unfair labor practice charge
                or other employment-related claim (other than normal benefit claims
                under
                Seller’s health and welfare Plans
                in the ordinary course of business)
                affecting the Totowa Property or the Business,
                (b)
                currently negotiating any collective bargaining agreement, or (c)
                currently a
                party to any collective bargaining agreement. Seller has furnished
                Buyer with a
                complete and correct list as of December 27, 2005 of the
                names, job titles, 2004 year end bonuses, year-to-date base pay,
                year-to-date
                overtime, accrued
                and
                unused sick and vacation days, Accrued Bonus, 401(k)
                employer match percentages, severance plan eligibility, tuition reimbursements
                paid and gym reimbursements paid for each current employee of Seller
                engaged in
                performing services for Seller at the Totowa Property
                (the
“Employee
                Compensation List”).
                On
                the date of this Agreement, there
                are seven active employees of Seller at the Totowa Property and no
                such
                employee
                is on authorized leave, medical or otherwise.
                The
                Employee Compensation List is true, complete and correct as of the
                date hereof
                and the Employee Compensation List, as updated pursuant to Section
                6.4, shall be
                true, complete and correct as of Seller’s most recent regular pay-roll date
                prior to the Closing Date. Seller has furnished Buyer with a complete
                and
                correct list of the names of any Persons (other than as contemplated
                by Section
                4.26) who will have a right to receive any cash consideration or
                other economic
                benefit as a result of the consummation of any of the Transactions
                and the
                nature and amount of such consideration or benefit. Seller
                has not violated the WARN Act or any New Jersey state Law relating
                to plant
                closings or mass layoffs with respect to the Totowa Property. During
                the 90 days
                prior to the date of
                this Agreement,
                Seller
                has not terminated any employees at the Totowa Property (one person
                has left).

               

              4.17    Governmental
                Permits.
                Schedule
                4.17
                sets
                forth a complete list of all material Governmental Permits which
                Seller owns,
                possesses, uses or holds for use in connection with the Business
                or otherwise
                applied for or held by Seller. Except as otherwise noted on Schedule
                4.17,
                Seller
                owns, possesses or lawfully uses in the operation of its Business
                all material
                Governmental Permits which are necessary (a) to conduct the Business
                as now
                conducted or (b) to the ownership of the Purchased Assets, free and
                clear of all
                Encumbrances. Except as set forth on Schedule
                4.17,
                no
                present or former officer, employee (including
                any current or former Union Employee under the Employee Lease) or
                representative of Seller, or any other Person owns or has any proprietary,
                financial or other interest (direct or indirect) in any material
                Governmental
                Permit which Seller owns, possesses, uses or holds for use in connection
                with
                the Business. Each Governmental Permit listed on Schedule 4.17 that
                is issued in
                the name of Seller is in good standing and in effect in accordance
                with its
                terms.

               

              4.18    Compliance
                with Law and Court Orders.
                Seller
                has complied with all, and is not in violation or Default of any,
                applicable
                Laws and Governmental Permits (except as otherwise stated in Section
                4.32,
                and
                other than Laws and Governmental Permits pertaining to environmental
                matters and
                FDA Requirements, which are addressed exclusively by Section
                4.24
                and
Section
                4.32,
                respectively) and with all Court Orders listed on Schedule
                4.18
                affecting Seller’s Assets, the operation of the Business or the Purchased
                Assets, which are all of the Court Orders to which Seller is a party
                or, to the
                Knowledge of Seller, to which it, the Business or the Purchased Assets
                are
                subject. Seller has made available to Buyer full and complete copies
                of all
                Court Orders (including all related correspondence and documentation)
                listed on
Schedule
                4.18.
                Neither
                Seller nor, to the Knowledge of Seller, any officer, employee or
                agent of Seller
                (a) has used any corporate funds of Seller to make any payment to
                any officer or
                employee of any government, or to any political party or official
                thereof, where
                such payment either (i) was, at the time, unlawful under Laws applicable
                thereto; or (ii) was, at the time, unlawful under the Foreign Corrupt
                Practices
                Act of 1977, as amended; or (b) has made or received an illegal payment,
                remuneration, direct or indirect, bribe, kickback, political contribution
                or
                other similar questionable illegal payment in connection with the
                operation of
                the Business. Seller
                has not received any written, or, to the Knowledge of Seller, other
                notices or
                communications from any Governmental Body or other Person regarding
                any actual,
                alleged, threatened, possible, or potential violation of, or failure
                to comply
                with, any Law, Governmental Permit or Court Order. No material capital
                expenditures are anticipated or required for Seller to comply with
                any Law,
                Governmental Permit or Courts Order.

               

              
                
                  
                  

                

                
                  21

                  
                    

                  

                

                
                  
                  

                

              

              4.19    Claims. 

               

              (a)    Except
                as
                disclosed in Schedule
                4.19:
                (i)
                there is no Legal Proceeding pending or, to the Knowledge of Seller,
                threatened
                against Seller, the Business or the Purchased Assets; and (ii) there
                is no
                dispute or disagreement pending or threatened in writing between
                Seller and any
                of its customers, suppliers, employees or consultants, and, to the
                Knowledge of
                Seller, there is no set of facts or circumstances that, with the
                passage of time
                or otherwise, could give rise to any such dispute or disagreement;
                and
                (iii)
                there is no Legal Proceeding that has been commenced by Seller that
                could
                reasonably be expected to have a Material Adverse Effect. 

               

              (b)    There
                is
                no Litigation pending or, to the Knowledge of Seller, threatened
                against Seller
                that challenges the legality, validity or enforceability of this
                Agreement, the
                other Transaction Documents or the Transactions or that could be
                reasonably
                expected to materially adversely affect the ability of Seller to
                complete the
                Transactions or have a Material Adverse Effect.

               

              4.20    Insurance.
                Schedule
                4.20
                lists
                all insurance coverage purchased by Seller currently in effect to
                which Seller
                is a party, a named insured or otherwise the beneficiary of insurance
                coverage
                (“Seller
                Insurance”).
                Copies of policies or binders evidencing Seller Insurance, to the
                extent
                available, have been made available for review by Buyer. All Seller
                Insurance is
                in full force and effect, and Seller is not in Default thereunder
                and any and
                all premiums that are due and payable with respect to any Seller
                Insurance have
                been paid in full. Except as described in Schedule
                4.20,
                no
                written notice of cancellation that has not been rescinded has been
                received by
                Seller with respect to the Seller Insurance. Prior to the date hereof,
                Seller
                has delivered to Buyer a list of all insurance claims (other than
                any individual
                claims of less than $5,000 that do not exceed $30,000 in the aggregate)
                made by
                Seller during its ownership and operation of the Business (the “Insurance
                Claims List”).
                The
                Insurance Claims List is true, complete and correct. Except as set
                forth on
Schedule
                4.20,
                there
                are no claims (other than any individual claims of less than $5,000
                that do not
                exceed $30,000 in the aggregate) made by Seller currently outstanding
                under any
                of the Seller Insurance.

               

              4.21    Non-Real
                Estate Leases.
                Schedule
                4.21
                lists
                all Purchased Assets used in the Business (other than Real Property)
                that are
                possessed by Seller under an existing lease, including all trucks,
                automobiles,
                forklifts, machinery, equipment, furniture and computers. Schedule
                4.21
                also
                lists the leases under which such Assets listed in Schedule
                4.21
                are
                possessed. All of such leases are referred to herein as the “Non-Real
                Estate Leases.”
                All
                Purchased Assets under a Non-Real Estate Lease are in good condition,
                ordinary
                wear and tear excepted, and are sufficient for the current operations
                of the
                Business. Seller is not in Default under any Non-Real Estate Lease.

               

              4.22    Employee
                Benefit Plans.
                

               

              (a)    Attached
                hereto as Schedule
                4.22
                is a
                list of all employee benefit plans, all employee welfare benefit
                plans, all
                employee pension benefit plans, all multiemployer plans and all multiple
                employer welfare arrangements (as defined in Sections
                3(3),
                (1),
                (2),
                (37)
                and
(40)
                respectively of ERISA) (collectively, the “Plans”,
                and
                individually, each a “Plan”),
                which
                are currently maintained and sponsored by Seller with respect to
                employees
                located at the Totowa Property, or to which Seller currently contributes,
                or
                currently existing Plans under which Seller will have an obligation
                to
                contribute in the future,
                or
                under
                which compensation or benefits are otherwise provided to employees
                of Seller
                located at the Totowa Property.
                Seller
                confirms that, under the terms of the Plans as in effect on the date
                of this
                Agreement and the Closing Date, the value of unused sick days and
                personal days
                are paid out to each non-exempt employee at the end of each calendar
                year, but
                vacation days may be carried over beyond the calendar year in which
                they are
                accrued. 

               

              
                
                  
                  

                

                
                  22

                  
                    

                  

                

                
                  
                  

                

              

              (b)    The
                Purchased Assets will not be subject to any Encumbrance (including
                any statutory
                Encumbrance) to secure payment of any Liability to the Pension Benefit
                Guaranty
                Corporation under Title IV of ERISA or to the Internal Revenue Service
                for any
                excise tax or penalty or otherwise with respect to any such Plan.

               

              (c)    All
                obligations of any nature under any Plan will constitute an Unassumed
                Liability
                and Buyer shall have no obligation or duty with respect to any Plan
                identified
                on Schedule
                4.22
                or other
                benefit made available by Seller to employees of Seller located at
                the Totowa
                Property. Seller shall continue to be responsible for the obligations
                and
                administration of all Plans and Seller’s employee benefits after the
                Closing.

               

              4.23    [Reserved]

               

              4.24    Environmental
                Matters.
                In
                addition to the representations and warranties in Section
                4.18,
                hereof
                and not in limitation thereof, and except as disclosed on Schedule
                4.24
                hereto,
                (a) no releases of Hazardous Materials have occurred at or from the
                Totowa
                Property during the period it was owned or leased by Seller or, to
                the Knowledge
                of Seller, at any other time, (b) there are no past, pending, or,
                to the
                Knowledge of Seller, threatened Environmental Claims against Seller,
                (c) there
                are no underground storage tanks owned by Seller, or located at the
                Totowa
                Property, (d) there are no facts, circumstances, or conditions that
                could
                reasonably be expected to restrict, under any Environmental Law or
                Environmental
                Permit in effect prior to or at the Closing Date, the ownership,
                occupancy, use
                or transferability of the Totowa Property, or to give rise to any
                material legal
                Liability under the Environmental Laws pertaining to the Totowa Property,
                (e)
                none of Seller nor its Affiliates has received a request under any
                of the
                Environmental Laws for information relating to the Totowa Property,
                (f) there
                are no unsatisfied financial assurance or closure requirements under
                the
                Environmental Laws pertaining to the Totowa Property on account of
                Seller’s use
                or ownership of such property, (g) any contaminant levels resulting
                from any
                releases of Hazardous Materials at or from the Totowa Property meet
                applicable
                remediation standards under applicable Environmental Law, (h) to
                the Knowledge
                of Seller, the Totowa Property is not now nor has in the past been
                listed on the
                National Priorities List of sites under the Comprehensive Environmental
                Response, Compensation and Liability Act, as amended (42 U.S.C. §9601 et seq.)
                (“CERCLA”),
                the
                CERCLA Information System, or any comparable state or local environmental
                database, (i) to the Knowledge of Seller, there is no asbestos-containing
                material, lead-based paint or equipment containing polychlorinated
                biphenyls
                located at the Totowa Property, (j) Seller has not provided information
                to any
                governmental authority of any actual, threatened or suspected releases
                of
                Hazardous Materials or any violation of any Environmental Permit
                or
                Environmental Law and (k) there is no Liability with respect to the
                cleanup or
                investigation at the Totowa Property resulting from the disposal
                or treatment
                (with a transporter or otherwise) of Hazardous Materials by Seller
                or, with
                respect to any Hazardous Materials generated by Seller, by any other
                party
                (Seller has made available to Buyer the Phase I Environmental Study
                conducted by
                Urban Engineers, Inc. on the Totowa Property in October 2004),
                (l) to
                the extent that the Totowa Property is a “Major Facility”as
                that
                term is defined in N.J.S.A. 58:10-23.11b,
                Seller
has
                furnished the New Jersey Department of Environmental Protection with
                all the
                information required by N.J.S.A. 58:10-23.11d1 through 11d17
                inclusive, (m)
                to the Knowledge of Seller, no lien has been attached to any revenues
                or any
                real or any personal property owned by Seller and located in New
                Jersey,
                including the Totowa Property, as a result of the administrator of
                the New
                Jersey Spill Compensation Fund expending monies from such fund to
                pay for
“Damages,” as that term is defined in N.J.S.A. 58:10-23.11g, and/or
“Clean
                up and Removal Costs,” as that term is defined in N.J.S.A. 58:10-23.11b,
                arising from an intentional or unintentional action or omission by
                Seller or any
                previous owner and/or operator of the Totowa Property resulting in
                the
                releasing, spilling, pumping, pouring, emitting, emptying or dumping
                of any
                Hazardous Materials into the waters of New Jersey or onto land from
                which it
                might flow or drain into such waters or into waters outside the jurisdiction
                of
                New Jersey where damage may have resulted to the lands, waters, fish,
                shellfish,
                wildlife, biota, air and other resources owned, managed, held in
                trust or
                otherwise controlled by New Jersey. As used in this Agreement:

               

              
                
                  
                  

                

                
                  23

                  
                    

                  

                

                
                  
                  

                

              

              (i)    “Environmental
                Claims”
                means
                any and all administrative or judicial actions, suits, orders, claims,
                liens,
                notices, investigations, violations or proceedings related to any
                applicable
                Environmental Law or any Environmental Permit brought, issued or
                asserted by a
                Governmental Body or third party for compliance, damages, penalties,
                removal,
                response, remedial or other action pursuant to any applicable Environmental
                Law
                or for personal injury or property damage resulting from the release
                of a
                Hazardous Material at, to or from the Totowa Property or any facility
                or
                property at which Seller disposed or arranged for the disposal or
                treatment
                (with a transporter or otherwise) of Hazardous Materials from the
                Totowa
                Property, including Seller employees seeking damages for exposure
                to Hazardous
                Materials;

               

              (ii)    “Environmental
                Laws”
                means
                all federal, state and local Laws related to protection of the environment,
                natural resources, safety or health or the handling, use, recycle,
                generation,
                treatment, storage, transportation or disposal of Hazardous Materials,
                and any
                common Law cause of action relating to the environment, natural resources,
                safety, health or the management of or exposure to Hazardous Materials,
                including without limitation, (i) the CERCLA; (ii) the Resource Conservation
                and
                Recovery Act of 1976, as amended, 42 U.S.C. 6901 et seq.
                (“RCRA”),
                (iii) the New Jersey Industrial Site Recovery Act, as amended,
                N.J.S.A.
                13:1K-6 et seq.
                (“ISRA”);
                (iv)
                the New Jersey Spill Compensation and Control Act, as amended, N.J.S.A.
                58:10-23.11 et seq.
                (“Spill
                Act”);
                and
                (v) the New Jersey Leaking Underground Storage Tank Act, as amended,
                N.J.S.A.
                58:10A-21 et seq.,
                as the
                same may be amended or supplemented from time to time. Any terms
                mentioned in
                this Section
                4.24
                which
                are defined in any Environmental Law shall have the meanings ascribed
                to such
                terms in said laws; provided, however, that if any of such laws are
                amended so
                as to broaden any term defined therein, such broader meaning shall
                apply
                subsequent to the effective date of such amendment;

               

              (iii)   “Environmental
                Permit”
                means
                all permits, licenses, approvals, authorizations or consents required
                by any
                Governmental Body under any applicable Environmental Law and includes
                any and
                all orders, consent orders or binding agreements issued or entered
                into by a
                Governmental Body under any applicable Environmental Law; and

               

              (iv)    “Hazardous
                Material”
                means
                any hazardous, toxic or radioactive substance, material or waste
                which is
                regulated as of the Closing Date by any state or local Governmental
                Body or the
                US, including any material or substance that is: (A) defined as a
“hazardous
                substance,”“regulated
                substance”
                or
“hazardous
                waste”
                under
                applicable state law, (B) petroleum, petroleum products or wastes,
                (C) asbestos,
                (D) designated as a “hazardous
                substance”
                pursuant to section 311 of the Federal Water Pollution Control Act,
                as amended,
                33 U.S.C. §1251 et seq. (33 U.S.C. § 1321), (E) defined as a “hazardous
                waste”
                pursuant to section 1004 of the RCRA, (F) defined as a “hazardous
                substance”
                pursuant to section 101 of the CERCLA, (G) defined as a “regulated
                substance”
                pursuant to section 9001 of the RCRA or (H) otherwise regulated
                under the
                Toxic Substances Control Act, as amended, 15 U.S.C. §2601 et seq., the Clean Air
                Act, as amended, 42 U.S.C. §7401 et seq., the Hazardous Materials Transportation
                Act, as amended, 49 U.S.C. §1801 et seq., or the Federal Insecticide, Fungicide
                and Rodenticide Act, as amended, 7 U.S.C. §136 et seq., the Emergency Planning
                and Community Right-to-Know Act, as amended, 42 U.S.C. §11001 et seq., the Safe
                Drinking Water Act, as amended, 42 U.S.C. §300(f) et seq., and the Occupational
                Safety and Health Act, as amended, 29 U.S.C. §651 et seq.

               

              
                
                  
                  

                

                
                  24

                  
                    

                  

                

                
                  
                  

                

              

              4.25    [Reserved]

               

              4.26    Broker’s
                or Finder’s Fee.
                No
                agent, broker, Person or firm acting on behalf of Seller or its Affiliates
                is,
                or will be, entitled to any commission or broker’s or finder’s fees from Seller
                or from any of its Affiliates in connection with this Agreement or
                any of the
                Transactions. 

               

              4.27    [Reserved]

               

              4.28    Certain
                Personal Property.
                Schedule
                4.28
                is a
                complete schedule of all fixed assets and tangible personal property
                included in
                the Purchased Assets (the “Fixed
                Assets”).
                Except for those items subject to the Non-Real Estate Leases described
                in
Section
                4.21
                and the
                Excluded Equipment, no Person other than Seller owns any vehicles,
                equipment or
                other tangible assets located on the Totowa Property and comprising
                the Fixed
                Assets. The Purchased Assets that are personalty are suitable for
                the purposes
                for which such Assets are currently used or are held for use, and
                are in good
                working condition, subject to normal wear and tear. The Fixed Assets
                are in
                compliance with all material Laws. 

               

              4.29    [Reserved]

               

              4.30    [Reserved]

               

              4.31    Solvency.
                Seller
                is not now insolvent and will not be rendered insolvent by any of
                the
                Transactions. As used in this Section, “insolvent” means that the sum of the
                debts and other probable Liabilities of Seller exceeds the present
                fair saleable
                value of Seller’s assets. Immediately after giving effect to the consummation of
                the Transactions: (a) Seller will be able to pay its Liabilities
                as they become
                due in the usual course of its business; (b) Seller will not have
                unreasonably
                small capital with which to conduct its present or proposed business;
                (c) Seller
                will have assets (calculated at fair market value) that exceed its
                Liabilities;
                and (d) taking into account all pending and threatened litigation,
                final
                judgments against Seller in actions for money damages are not reasonably
                anticipated to be rendered at a time when, or in amounts such that,
                Seller will
                be unable to satisfy any such judgments promptly in accordance with
                their terms
                (taking into account the maximum probable amount of such judgments
                in any such
                actions and the earliest reasonable time at which such judgments
                might be
                rendered) as well as all other obligations of Seller. The cash available
                to
                Seller, after taking into account all other anticipated uses of the
                cash, will
                be sufficient to pay all such debts and judgments promptly in accordance
                with
                their terms.

               

              4.32    FDA.
                Except
                as
                otherwise indicated
                on Schedule
                4.32,
                the
                Business is in compliance
                with all
                applicable requirements of the Federal Food, Drug, and Cosmetic Act
                (“FFDCA”),
                the
                Public Health Service Act (“PHSA”),
                and
                the regulations promulgated thereunder by the US Food and Drug Administration
                (the “FDA”),
                Related to the Business (collectively the “FDA
                Requirements”).
                Except
                as otherwise indicated on
                Schedule
                4.32
                or the
                FDA Documents, Seller has not received any written notice or,
                to
                the Knowledge of Seller, other communication from the FDA or other
                Governmental
                Body alleging any violation of the FDA Requirements. Seller has provided
                or made
                available to Buyer all documents and communications in its possession
                concerning
                communications from, and to, the FDA and any other Governmental Body
                or prepared
                by the FDA or any other Governmental Body that bear in any material
                respect on
                compliance by the Business with the FDA Requirements (as listed on
Schedule
                4.32,
                the
“FDA
                Documents”).
                Seller has filed with the FDA DMFs bearing DMF numbers 16941 and
                17159 and has
                maintained and kept current such DMFs. With respect to the Business,
                Seller is
                not directly engaged in any testing involving human subjects or human
                specimens,
                and has not filed investigational new drug applications (“INDs”),
                new
                drug applications (“NDAs”),
                supplemental NDAs, biologics license applications (“BLAs”)
                or
                submitted any other marketing application to the FDA; provided,
                however,
                Buyer
                hereby acknowledges that third parties are engaged in such testing
                of products
                manufactured or otherwise handled at the Totowa Property, and Seller
                disclaims
                any and all representations and warranties regarding or relating
                to any such
                testings, any such products, and any such INDs, NDAs and BLAs, as
                applicable. To
                the Knowledge of Seller, neither Seller, nor any officer, employee,
                or agent of
                Seller has made an untrue statement of a material fact or fraudulent
                statement
                to the FDA or other Governmental Body or knowingly failed to disclose
                a material
                fact required to be disclosed to the FDA or other Governmental Body
                Related
                to the
                Totowa Property or products manufactured at the Totowa Property.
                Neither
                Seller, nor, to the Knowledge of Seller, any officer or employee
                of
                Seller,
                has been
                or is subject to debarment, temporary denial of approval or suspension
                under 21
                U.S.C. §§335a(a) or (b).
                

               

              
                
                  
                  

                

                
                  25

                  
                    

                  

                

                
                  
                  

                

              

              4.33    Statements
                and Other Documents Not Misleading.
                

               

              (a)    Neither
                this Agreement, including all schedules and exhibits, nor any financial
                statement, document or other instrument specifically referred to
                herein or
                delivered pursuant hereto furnished by Seller to Buyer pursuant hereto
                in
                connection with the Transactions contains or will contain any untrue
                statement
                of any material fact or omits or will omit to state any material
                fact required
                to be stated in order to make such statement, document or other instrument
                not
                misleading.

               

              (b)    THE
                EXPRESS INTENTION OF SELLER AND BUYER IS THAT BUYER SHALL PURCHASE
                THE PURCHASED
                ASSETS AND ASSUME THE ASSUMED LIABILITIES FROM SELLER WITHOUT ANY
                REPRESENTATIONS, WARRANTIES OR COVENANTS, EXPRESS OR IMPLIED, FROM
                OR OF SELLER
                OTHER THAN OTHERWISE SET FORTH HEREIN. BUYER HEREBY WAIVES AND RELINQUISHES
                ALL
                RIGHTS AND PRIVILEGES ARISING OUT OF, OR WITH RESPECT OR IN RELATION
                TO, ANY
                REPRESENTATIONS, WARRANTIES, AND COVENANTS, WHETHER EXPRESS OR IMPLIED,
                WHICH
                MAY HAVE BEEN MADE OR GIVEN, OR WHICH MAY BE DEEMED TO HAVE BEEN
                MADE OR GIVEN,
                BY SELLER, OTHER THAN AS SET FORTH HEREIN.

               

              5.    Representations
                and Warranties of Buyer.
                Buyer
                hereby represents and warrants to Seller as follows: 

               

              5.1    Organization
                and Standing.
                Buyer
                is a corporation duly organized, validly existing and in good standing
                under the
                laws of the State of Delaware, having all requisite corporate power
                and
                authority to perform its obligations under this Agreement. 

               

              5.2    Authority
                and Binding Effect.
                Buyer
                has full power and authority to execute, deliver and perform this
                Agreement and
                the other Transaction Documents to which it is a party and has taken
                all actions
                necessary to secure all approvals required in connection therewith.
                The
                execution, delivery and performance of this Agreement and the consummation
                of
                the Transactions by Buyer have been duly authorized by all necessary
                corporation
                action. Assuming due authorization, execution and delivery by Seller,
                this
                Agreement constitutes the legal, valid and binding obligation of
                Buyer,
                enforceable against it in accordance with its terms. 

               

              5.3    Validity
                of Contemplated Transactions.
                Neither
                the execution and delivery by Buyer of any of the Transaction Documents
                to which
                it is a party, nor the performance of the Transactions performed
                or to be
                performed by Buyer under the Transaction Documents, require any notice,
                filing,
                consent, renegotiation or approval, constitute a Default, cause any
                payment
                obligation to arise or give any Person the right to challenge any
                of the
                Transactions under (a) any Law or Court Order which is applicable
                to Buyer, (b)
                any Contract, Governmental Permit or other document to which Buyer
                is a party or
                by which the properties or other assets of Buyer may be bound or
                (c) except as
                have already been obtained, the Charter Documents of Buyer. 

               

              
                
                  
                  

                

                
                  26

                  
                    

                  

                

                
                  
                  

                

              

              5.4    Broker’s
                or Finder’s Fee.
                No
                agent, broker, Person or firm acting on behalf of Buyer is, or will
                be, entitled
                to any commission or broker’s or finder’s fees from any of the Parties or from
                any of their Affiliates in connection with this Agreement or any
                of the
                Transactions.

               

              5.5    Availability
                of Funds.
                Buyer
                has, or will have, cash or credit facilities available that are sufficient
                to
                enable it to make payment of the Purchase Price at Closing without
                the necessity
                of securing additional third-party financing.

               

              5.6    Claims.
                There
                is no Litigation pending or, to the Knowledge of Buyer, threatened
                against Buyer
                that challenges the legality, validity or enforceability of this
                Agreement, the
                other Transaction Documents or the Transactions or that materially
                would
                adversely affect the ability of Buyer to complete the Transactions.

               

              5.7    FDA.
                To the
                knowledge of Buyer, neither Buyer, nor any officer, employee, or
                agent of Buyer
                has made an untrue statement of a material fact or fraudulent statement
                to the
                FDA or other Governmental Body or failed to disclose a material fact
                required to
                be disclosed to the FDA or other Governmental Body pertaining
                to the Totowa Property or product manufactured at the Totowa
                Property.
                Neither
                Buyer, nor, to the knowledge of Buyer, any officer or employee of
                Buyer, has
                been or is subject to debarment, temporary denial of approval or
                suspension
                under 21 U.S.C. §§335a(a) or (b).

               

              6.    Pre-Closing
                Covenants.

               

              6.1    Access.
                From the
                date of this Agreement to the Closing Date, Seller shall give Buyer
                and its
                counsel, accountants and other representatives access during normal
                business
                hours to the premises of the Business, personnel, counsel, books
                and records,
                accounts and other representatives of Seller and furnish to Buyer
                and such
                representatives all such additional documents and information with
                respect to
                the Business as Buyer may from time to time reasonably request, subject
                to
                applicable confidentiality requirements and Seller’s existing obligations to its
                other customers, to permit Buyer to promptly complete its business,
                legal,
                accounting and financial due diligence investigation of the Purchased
                Assets and
                the Business prior to the Closing. Without limiting the foregoing,
                Seller shall
                provide Buyer copies of such documents and information or such access
                and
                introductions, and in each case, within the time periods, set forth
                on
Schedule
                6.1.
                Any
                visits shall be conducted in a manner so as to minimize disruptions
                to the
                operations of Seller. Seller shall promptly introduce Buyer to such
                of Seller’s
                employees, distributors and suppliers as Buyer may request. Seller
                agrees that
                no investigation by Buyer or its representatives shall affect or
                limit the scope
                of the representations and warranties of Seller herein or limit the
                liability of
                Seller for any breach of such representations and warranties. 

               

              6.2    [Reserved]

               

              6.3    Operation
                of the Business.
                Except
                as set forth on Schedule
                6.3
                or as
                otherwise expressly permitted or required by this Agreement, between
                the date of
                this Agreement and the Closing Date Seller acknowledges that solely
                with respect
                to the Totowa Property:

               

              (a)    Seller
                shall conduct the Business in the ordinary course in accordance with
                its past
                practice under the Existing Manufacturing Agreement, except that,
                without the
                written consent of Buyer, Seller shall not undertake any capital
                improvement or
                make any commitment for capital expenditures in excess of $15,000
                in the
                aggregate. Seller
                shall maintain and service the Purchased Assets consistent with past
                practice
                and preserve intact the Business as it is currently operated; 

               

              
                
                  
                  

                

                
                  27

                  
                    

                  

                

                
                  
                  

                

              

              (b)    For
                the
                avoidance of doubt, the Parties acknowledge and agree that (i) the
                DAS Agreement
                is not a Purchased Asset or an Assumed Liability, (ii) Buyer shall
                have no
                obligation with respect to
                the
                DAS Agreement, either before or after the Closing, and (iii) Seller
                shall be
                solely responsible for the performance of its obligations under the
                DAS
                Agreement;

               

              (c)    Seller
                will use its Commercially Reasonable efforts to obtain in writing
                as promptly as
                possible all Seller Required Consents and all of the Closing Consents,
                which
                consents shall be in a form reasonably acceptable to Buyer and its
                counsel and
                shall not be subject to the satisfaction of any condition that has
                not been
                satisfied or waived;

               

              (d)    Seller
                shall not: (i) incur any Liability that would be an Assumed Liability
                other than
                in the ordinary course of business; (ii) without the consent of Buyer,
                enter
                into, amend, modify, terminate (partially or completely), grant any
                waiver under
                or give any consent with respect to any Seller Contract or incur
                any Liability
                Related to the Business other than in the ordinary course of business;
                (iii) Default under, or take or fail to take any action that
                (with or
                without notice or lapse of time or both) would constitute a Default
                under any
                term or provision of any Seller Contract; or (iv) create or permit
                any
                Encumbrance (other than Permitted Encumbrances) on any of the Purchased
                Assets;

               

              (e)    Seller
                shall comply in all material respects with all applicable Laws; and

               

              (f) Seller
                shall not (i) hire any new employee at the Totowa Property or enter
                into any
                employment contract, or, (ii) except in the ordinary course of business
                consistent with past practice, increase the rate of compensation
                payable or to
                become payable by it to any personnel at the Totowa Property, or
                (iii) amend,
                modify or increase the benefits available to employees at the Totowa
                Property
                under any Plan, or (iv) introduce any new Plan or benefit to such
                employees.

               

              6.4   Update
                of Schedules.
                Prior
                to the Closing, Seller shall, after obtaining Knowledge thereof,
                as promptly as
                practicable disclose to Buyer in writing any information set forth
                in the
                Schedules hereto which has become inaccurate and any information
                of the nature
                of that set forth in the Schedules which arises after the date hereof
                and which
                would have been required to be included in the Schedules if such
                information had
                existed on the date hereof. Such disclosure shall not limit or affect
                any of
                Buyer’s rights hereunder for or with respect to any misrepresentation or
                breach
                of warranty by Seller or Seller’s failure to fulfill any covenant, agreement or
                condition contained in this Agreement. At or prior to the Closing,
                Seller shall
                (i) update the Insurance Claims List to reflect any insurance claims
                made by
                Seller prior to the Closing and since the last such claim identified
                on the
                Insurance Claims List originally delivered in accordance with Section
                4.20,
                and
                (ii) update as of Seller’s most recent regular payroll date prior to the Closing
                Date the Employee Compensation List to reflect changes, if any, to
                the
                compensation and benefits reflected on the Employee Compensation
                List originally
                delivered in accordance with Section
                4.16.
                

               

              6.5    Employees
                and Business Relations.
                

               

              (a)    From
                the
                date hereof and up to and including the Closing Date, (i) Seller
                shall use its
                Commercially Reasonable efforts (but shall not be required to increase
                wages or
                benefits) to keep available the services of the current employees
                and agents of
                the Business, and (ii) Seller shall use Commercially Reasonable efforts
                to
                maintain the relations and goodwill with the suppliers, distributors
                of the
                Business. Buyer shall make an offer of employment to at least five
                of the seven
                active employees of Seller dedicated to the Totowa Property (the
“Offeree
                Employees”).
                Any
                employee who does not receive such an offer of employment is referred
                to herein
                as a “Non-Offeree
                Employee.”
                For
                purposes hereof, an employee shall be considered “active” if such employee is in
                good standing on the Closing Date, including any such employee who
                is on an
                authorized leave, medical or other, on the Closing Date. Buyer shall
                provide
                Seller with a list of the Non-Offeree Employees no more than five
                Business Days
                after the date of this Agreement. Each offer of employment to an
                Offeree
                Employee shall include salary and cash incentive compensation (excluding,
                for
                this purpose, payments under any severance plan or arrangement) that,
                in the
                aggregate, is substantially comparable to that provided to such employee
                by
                Seller, and benefits comparable to Buyer’s health, welfare and other benefit
                plans made available to Buyer’s current employees, provided, that Buyer shall
                credit each Offeree Employee with up to an aggregate of ten vacation
                and sick
                days that have been accrued as of the Closing Date but not taken
                by such Offeree
                Employee under Seller’s vacation and sick day policies (each such offer, a
“Qualified
                Offer”).
                Each
                Qualified Offer shall comply in all material respects with all applicable
                Laws,
                including all employment Laws dealing with discrimination. In the
                event an
                Offeree Employee accepts a Qualified Offer and is hired by Buyer
                (each a
“Transferred
                Employee”),
                such
                Transferred Employee’s employment with Buyer shall be effective the first
                business day following the Closing Date. In
                crediting such Transferred Employees with accrued sick and vacation
                days, Buyer
                shall be entitled to rely on the Employee Compensation List, as updated
                by
                Seller through the Closing Date pursuant to Section
                6.4.

               

              
                
                  
                  

                

                
                  28

                  
                    

                  

                

                
                  
                  

                

              

              (b)    Seller
                shall not provide any offer of continued employment to any Offeree
                Employee or
                otherwise attempt to dissuade or discourage any Offeree Employee
                from accepting
                a Qualified Offer. On or before the Closing Date, Seller shall pay
                to each
                Transferred Employee identified on Schedule
                6.5(b)
                the
                annual bonus accrued through the Closing Date (“Accrued
                Bonus”)
                in the
                amount set forth opposite such Transferred Employee’s on the Employee
                Compensation List, and shall be responsible for all costs related
                thereto.

               

              (c)    On
                or
                before the Closing Date, Seller shall pay to each Transferred Employee,
                if
                applicable, an amount equal to the number of days’ pay that equals the number of
                accrued sick and vacation days in excess of ten that such Transferred
                Employee
                shall have accrued as of the Closing Date, and shall be responsible
                for all
                costs related thereto.

               

              (d)    Buyer
                shall have no obligation under this Agreement to continue the employment
                of any
                Transferred Employee, to continue to pay any specified salary or
                bonus
                compensation to any such Transferred Employee or, except as provided
                in
Section
                6.5(a)
                with
                respect to credits for accrued sick and vacation days, to provide
                to any such
                Transferred Employee any specific health, welfare or other plan benefits
                or
                perquisites. Following the Closing, Buyer shall be entitled to manage
                its staff
                levels and administer its human resources policies and benefit plans
                in such
                manner as it, in its sole discretion, may deem appropriate.

               

              (e)    From
                the
                date hereof and up to and including the Closing Date, without the
                written
                consent of Buyer, Seller shall not take any action under the Employee
                Lease to
                (i) increase or decrease the number of Union Employees, or (ii) substitute
                any
                Union Employees for any other Union Employees. Notwithstanding the
                foregoing,
                (A) Seller shall use its Commercially Reasonable efforts to assist
                Buyer in
                negotiating with the Lessor and the Labor Union representing the
                employees
                provided to Seller under the Employee Lease to achieve a replacement
                agreement
                (in a form acceptable to Buyer) between Buyer and Local 825, International
                Chemical Workers Union Council of the United Food and Commercial
                Workers
                International Union (the “Union”)
                and
                (B) on or before the Closing, Seller and the other parties thereto
                shall enter
                into the Termination Agreement.

               

              
                
                  
                  

                

                
                  29

                  
                    

                  

                

                
                  
                  

                

              

              6.6    Confidentiality.
                

               

              (a)    If
                the
                Transactions are not consummated, each Party shall treat all information
                obtained in its investigation of another Party or any Affiliate thereof
                as
                confidential in accordance with the terms of the Confidentiality
                Agreement.

               

              (b)    Each
                Party agrees that it will not file the Schedules to this Agreement
                with the U.S.
                Securities and Exchange Commission (the “SEC”)
                pursuant to Item 601(b)(2) of Regulation S-K; provided,
                that,
                if the
                SEC requests a copy of any Schedule so omitted from a Party (for
                this purpose,
                the “Disclosing
                Party”),
                the
                Disclosing Party shall furnish such requested Schedule to the SEC
                supplementally, with a request that the SEC return the Schedules
                pursuant to
                Rule 418(b) of the Securities Act or Rule 12b-4 of the Exchange Act;
                provided,
                further, that if after reviewing any Schedule furnished pursuant
                to the
                preceding proviso, the SEC determines that the Disclosing Party is
                required to
                file such Schedule, then the Disclosing Party shall file such Schedule
                or
                otherwise comply with any request of the SEC. If the Disclosing Party
                determines, in its sole discretion, that it must file any of the
                Exhibits to
                this Agreement with the SEC or any other Governmental Body or securities
                exchange pursuant to applicable Law, then the Disclosing Party agrees
                to consult
                with the other Party to determine if any of the information contained
                in such
                Exhibits is appropriate for confidential treatment. If the Disclosing
                Party, in
                its sole discretion, determines after such consultation that any
                information in
                such Exhibits is appropriate for confidential treatment, the Disclosing
                Party
                shall redact such information from the version of the Exhibit that
                is filed with
                the SEC and shall submit a confidential treatment request relating
                to such
                information. Notwithstanding the foregoing, nothing contained in
                this Agreement
                shall in any way affect the right of a Party to take, or refrain
                from taking,
                any actions that such Party, in its sole discretion, determines are
                necessary or
                advisable to in order to comply with (i) all applicable Laws or (ii)
                any request
                from the SEC or any other Governmental Body or securities exchange.

               

              6.7    Related
                Parties.
                Each
                Party shall use its commercially reasonable efforts to cause its
                Affiliates to
                take or refrain from taking any action that may be necessary to carry
                out the
                Transactions.

               

              6.8    Transfer
                of Purchased Assets and Business.
                Subject
                to the satisfaction of or waiver by the applicable Party of the conditions
                set
                forth in Section
                8
                or
Section
                9,
                as
                applicable, on and prior to the Closing Date, Seller shall take such
                reasonable
                steps as may be necessary or appropriate, in the judgment of Buyer,
                such that at
                and after the Closing Buyer shall be placed in actual possession
                and control of
                all of the Purchased Assets and the Business. In furtherance thereof,
                Seller
                shall execute and deliver such additional instruments of conveyance
                and transfer
                as Buyer may reasonably require, in the judgment of Buyer, in order
                to more
                effectively vest in it, and put it in possession of, the Purchased
                Assets.

               

              6.9    Fulfillment
                of Closing Conditions.
                (a) At
                and prior to the Closing, each Party shall use Commercially Reasonable
                efforts
                to fulfill, and to cause each other to fulfill, as soon as practicable
                before
                the Termination Date the conditions specified in Section
                8
                and
Section
                9
                to the
                extent that the fulfillment of such conditions is within its control.
                In
                connection with the foregoing, each Party will (i) refrain from any
                actions that
                would cause any of its representations and warranties to be inaccurate
                as of the
                Closing, and take any reasonable actions within its control that
                would be
                necessary to prevent its representations and warranties from being
                inaccurate as
                of the Closing, (ii) execute and deliver the applicable agreements
                and other
                documents referred to in Section
                8
                and
Section
                9,
                (iii)
                comply with all applicable Laws in connection with its execution,
                delivery and
                performance of this Agreement, the other Transaction Documents to
                which it is a
                party and the Transactions, (iv) use commercially reasonable efforts
                to obtain
                in a timely manner all necessary waivers, consents and approvals
                required under
                any Laws, Contracts or otherwise, including the Closing Consents
                and the Seller
                Required Consents in the case of Seller, and (v) use commercially
                reasonable efforts to take, or cause to be taken, all other actions
                and to do,
                or cause to be done, all other things reasonably necessary, proper
                or advisable
                to consummate and make effective as promptly as practicable the
                Transactions.

               

              
                
                  
                  

                

                
                  30

                  
                    

                  

                

                
                  
                  

                

              

              6.10    DMF.
                 On
                or
                prior to the Closing Date, Seller shall have provided to Buyer full
                and complete
                copies of DMF numbered 17159 and all related documentation.

               

              6.11    [Reserved]

               

              6.12    [Reserved]

               

              6.13    [Reserved]

               

              6.14    Environmental.
                Within
                five Business Days following the date of this Agreement, Seller shall
                file with
                the NJDEP (with copies to Buyer) an application (including all supporting
                documentation) requesting NJDEP issue a letter stating that ISRA,
                including the
                regulations promulgated thereunder, is not applicable to the transaction
                contemplated by this Agreement (the “LNA”).
                Seller shall use its commercially reasonable efforts to obtain the
                LNA prior to
                Closing but the Closing shall not be conditioned upon such
                issuance.

               

              6.15    Further
                Assurances.
                Consistent with the terms and conditions hereof, each Party hereto
                shall use its
                best efforts to execute and deliver such other documents and take
                such other
                actions as reasonably requested by the other Party to fulfill the
                conditions
                precedent to the obligation of the other Party to consummate the
                purchase and
                sale of the Business, or as the other Party hereto may reasonably
                request in
                order to carry out this Agreement and the Transactions contemplated
                hereby.

               

              7.    Post-Closing
                Covenants.

               

              7.1    Transition
                Period.
                For a
                period of 12 months after the Closing Date, Seller and its Affiliates
                shall
                forward to Buyer all mail, remittance, receipts or other mailings
                received by
                any of them relating to the Business other than the Excluded Assets
                and the
                Unassumed Liabilities.

               

              7.2    Employees.
                

               

              (a)    Buyer
                shall be solely responsible for all Liabilities arising out of or
                related to the
                actual or constructive termination of employment occurring after
                the Closing
                Date of any Transferred Employee. Seller
                will be responsible for providing COBRA continuation coverage as
                required by Law
                to all Employees of Seller that are not Transferred Employees, and
                their
                eligible dependents covered under the health plans in which Seller
                participates.
                Seller shall provide COBRA continuation coverage at Buyer’s expense to
                Transferred Employees until such time as such Transferred Employees
                are eligible
                for benefits under Buyer’s health and welfare plans. In order to receive COBRA
                continuation coverage, such individuals must properly elect to receive
                such
                coverage, and make prompt and timely payment of all premiums due
                in respect of
                such COBRA continuation coverage. Seller acknowledges that Buyer
                will offer
                Transferred Employees and their eligible dependents coverage under
                Buyer’s
                health plan effective on the first day of the month following completion
                of 30
                days of employment with Buyer.
                Seller
                shall
                be
                solely responsible for reasonable severance payments to
                not more than
                two Non-Offeree Employees
                identified by Buyer pursuant to Section
                6.5
                and
                to any
                Offeree Employees who do not accept a Qualified Offer from Buyer,
                provided that, if Buyer shall have failed to make
                a Qualified Offer
                to at
                least five employees
                of
                Seller, Buyer shall be solely responsible for reimbursing Seller
                for severance
                payments in accordance with Seller’s existing policy to all but two Non-Offeree
                Employees.
                

               

              
                
                  
                  

                

                
                  31

                  
                    

                  

                

                
                  
                  

                

              

              
                (b)    For
                  purposes of the WARN Act and applicable state Law, (i) Transferred
                  Employees
                  hired by Buyer shall become employees of Buyer on the first business
                  day
                  following the Closing Date and (ii) Buyer shall assume all responsibility
                  for
                  any 60-day advance WARN Act notice with regard to any layoffs by
                  Buyer following
                  the Closing.

                 

                (c)    Seller
                  shall make all distributions and payments required under the terms
                  of the Plans
                  and take all necessary and appropriate actions to maintain,
                  distribute
                  or rollover any benefits to which each Transferred Employee may
                  be entitled
                  under the Plans.

                 

                (d)    For
                  a
                  period of two years following the Closing Date, neither Seller
                  nor its
                  Affiliates shall,
                  directly or indirectly at any time, solicit, induce or encourage
                  or participate
                  in soliciting, inducing or encouraging any Transferred Employee
                  to terminate his
                  or her employment with Buyer or to work for Seller, a competitor
                  of Seller or a
                  competitor of Buyer; provided,
                  however,
                  neither
                  Seller nor its Affiliates shall be prohibited from (i) conducting
                  general
                  solicitations for employees in the ordinary course of business
                  through the use
                  of media advertisements or recruiting agencies (provided that such
                  recruiting
                  agencies are instructed not to target Buyer) or hiring Transferred
                  Employees who
                  independently respond to such general solicitations without prior
                  contact by
                  Seller or any agent or representative of Seller, or (ii) hiring
                  a Transferred
                  Employee at any time after the end of the sixth calendar month
                  following the
                  termination of such Transferred Employee’s employment with Buyer.

                 

                (e)    Buyer
                  will fully perform its obligations to make payments pursuant to
                  the terms of
                  Article 22, Section 11 of that certain Memorandum of Agreement
                  dated December
                  22, 2005 between Buyer and the Union.

                 

                7.3    Tax
                  Matters.
                  

                 

                (a)    After
                  the
                  Closing Date, Buyer and Seller shall (i) provide, or cause to be
                  provided, to
                  each other’s respective subsidiaries, officers, partners, employees,
                  representatives and Affiliates such assistance as may reasonably
                  be requested by
                  any of them in connection with the preparation of any Tax Return
                  or any audit
                  which relates to the Business in respect of which Buyer or Seller
                  are
                  responsible hereunder and (ii) retain, or cause to be retained,
                  for so long as
                  any such taxable years or audits shall remain open for adjustments,
                  any records
                  or information which may be relevant to any such Tax Returns or
                  audits. The
                  assistance provided for in this subsection (a) shall include each
                  of Buyer and
                  Seller (x) making their agents and employees and the agents and
                  employees of
                  their respective Affiliates available to each other on a mutually
                  convenient
                  basis to provide such assistance as might reasonably be expected
                  to be of use in
                  connection with any such Tax Returns or audits and (y) providing,
                  or causing to
                  be provided, such information as might reasonably be expected to
                  be of use in
                  connection with any such Tax Returns or audits, including records,
                  returns,
                  schedules, documents, work papers, opinions, letters or memoranda,
                  or other
                  relevant materials relating thereto.

                 

                (b)    All
                  transfer, documentary, sales, use, stamp, registration and other
                  such Taxes and
                  fees (including any penalties and interest) incurred in connection
                  with this
                  Agreement, shall be paid by Seller when due, and Seller shall,
                  at its own
                  expense, file all necessary Tax Returns and other documentation
                  with respect to
                  all such transfer, documentary, sales, use, stamp, registration
                  and other Taxes
                  and fees, and, if required by applicable Law, Buyer shall, and
                  shall cause its
                  Affiliates to, join in the execution of any such Tax Returns and
                  other
                  documentation.

                 

                (c)    Seller
                  and Buyer agree that in the case of property Taxes that are payable
                  with respect
                  to a taxable period that begins before the Closing Date and ends
                  after the
                  Closing Date, (i) Seller shall be liable for and shall pay the
                  portion of any
                  such Taxes that is allocable to the portion of the period ending
                  on the Closing
                  Date, which shall be deemed to be the amount of such Taxes for
                  the entire period
                  multiplied by a fraction, the numerator of which is the number
                  of calendar days
                  in the period ending on the Closing Date and the denominator of
                  which is the
                  number of calendar days in the entire period and (ii) Buyer
                  shall be liable
                  for and shall pay the remaining portion of such property or similar
                  Taxes that
                  is allocable to the portion of the period commencing after the
                  Closing Date. To
                  the extent that Seller has paid or caused to have been paid all
                  or a portion of
                  such Taxes payable by Buyer pursuant to the preceding sentence,
                  Buyer shall
                  reimburse Seller for such Taxes payable by Buyer at the Closing.
                  To the extent
                  that Buyer has paid or caused to have been paid all or a portion
                  of such Taxes
                  payable by Seller pursuant to this Section
                  7.3(c),
                  Seller
                  shall reimburse Buyer for such amount within seven calendar days
                  after the date
                  on which Buyer notifies Seller that such Taxes have been paid by
                  or on behalf of
                  Buyer. For purposes of Section
                  2.3(b)(ii)
                  with
                  respect to Taxes imposed on a periodic basis which are payable
                  for a period that
                  includes, but does not end on, the Closing Date, such Taxes shall
                  be allocated
                  ratably on a daily basis.

                 

                
                  
                    
                    

                  

                  
                    32

                    
                      

                    

                  

                  
                    
                    

                  

                

                (d)    On
                  or
                  before the Closing, Buyer and Seller shall endeavor in good faith
                  to agree on an
                  allocation of the Purchase Price (together with the Assumed Liabilities)
                  among
                  the Purchased Assets in accordance with the rules of section 1060
                  of the Code
                  and the regulations thereunder as attached hereto as Schedule
                  7.3(d)
                  (the
“Allocation”).
                  If
                  Buyer and Seller disagree about any aspect of the Allocation after
                  negotiating
                  in good faith, then any disputed issues relating to the Allocation
                  will be
                  finally and conclusively determined by an independent accounting
                  firm of
                  recognized national standing (the “Allocation
                  Arbiter”)
                  selected by Buyer and Seller, which firm shall not be the regular
                  accounting
                  firm of either Buyer or Seller. The Allocation Arbiter will determine
                  (based
                  solely on presentations by Buyer and Seller and not by independent
                  review) only
                  those matters in dispute and will render a written report as to
                  the disputed
                  matters and the resulting allocation of Purchase Price (together
                  with the
                  Assumed Liabilities), which report shall be conclusive and binding
                  upon the
                  parties. Buyer and Seller shall not, subject to the requirements
                  of any
                  applicable tax law or election, file any Tax Returns and reports
                  or take any
                  positions before any Governmental Body inconsistent with the Allocation.
                  Buyer
                  and Seller shall cooperate in the preparation and filing of IRS
                  Form 8594 (as
                  amended) and any required exhibits thereto with the IRS (and any
                  comparable
                  forms with the appropriate authorities) in a manner consistent
                  with the
                  Allocation.

                 

                7.4    Governmental
                  Permits.
                  a)
                  On the
                  Closing Date, each Party shall file or transmit, as applicable,
                  such notices,
                  letters, instruments and the like with or to the FDA relating to
                  the
                  Transactions as may required to comply with all applicable Laws,
                  and in
                  furtherance thereof,

                 

                (i)    Buyer
                  shall transmit to the FDA: 

                 

                (1)    the
                  notices relating to the Drug Establishment Registrations for the
                  Totowa Property
                  in the form set forth in Exhibit
                  C-1
                  for the
                  purpose of informing the FDA, in compliance with 21 C.F.R. Sec.
                  207.26,
                  of the change in ownership of the Totowa Property resulting from
                  the
                  Transactions and notice of this transaction as it relates to Buyer’s NDA;
                  and

                 

                (2)    the
                  letters of acceptance relating to the transfer of the DMF numbered
                  17159 for the
                  Totowa Property in the form set forth in Exhibit
                  C-2,
                  for the
                  purpose of informing the FDA, in compliance with Part VII.E in
                  the Guidelines
                  for Drug Master Files, as published by the FDA, of Buyer’s acceptance of the
                  transfer of the DMF for the Totowa Property; and

                 

                (ii)    Seller
                  shall transmit to the FDA the letters of transfer relating to the
                  transfer of
                  the DMF numbered 17159 for the Totowa Property in the form set
                  forth in
Exhibit
                  C-3,
                  for the
                  purpose of informing the FDA, in compliance with Part VII.E in
                  the Guidelines
                  for Drug Master Files, as published by the FDA, of the transfer
                  of the DMF for
                  the Totowa Property. 

                 

                
                  
                    
                    

                  

                  
                    33

                    
                      

                    

                  

                  
                    
                    

                  

                

                (b)    On
                  the
                  Closing Date, each Party shall file or transmit, as applicable,
                  such
                  applications, notices, letters, instruments and the like to effect
                  the transfer,
                  re-issuance or cancellation and issuance of the Governmental Permits
                  to and in
                  the name of Buyer.

                 

                7.5    Existing
                  Seller Clients.
                  Buyer
                  acknowledges that Seller is presently in discussions with DAS regarding
                  the
                  obligations of Seller under the DAS Agreement. To the extent permissible,
                  Seller
                  shall notify Buyer of the non-economic terms of any resolution
                  of such
                  discussions. Under no circumstances will Buyer be responsible for
                  any obligation
                  or Liability of Seller under the DAS Agreement.

                 

                7.6    DMF.
                  Through
                  the date of termination of the Transition Services Agreement, Seller
                  shall continue to maintain and keep current DMF numbered 16941
                  (Contract
                  Manufacturing) and permit Buyer to cross-reference Seller’s DMF numbered 16941
                  in Buyer’s own IND and NDA filings after the Closing.

                 

                7.7    Insurance.
                  For
                  three years after the Closing, Seller shall, at its own expense,
                  maintain
                  liability insurance coverage for claims relating to its business
                  operations for
                  incidents that occurred prior to the Closing (on a claims-made
                  basis), with
                  responsible companies and comparable in amount, scope and coverage
                  to that in
                  effect on December 1, 2005, to the extent that such insurance can
                  be purchased
                  on substantially comparable terms to those policies in effect on
                  such date;
                  provided that Seller shall be entitled to reduce its Manufacturer's
                  Liability
                  policy limit to $5 million after the Closing. 

                 

                7.8    Totowa
                  Property Signage.
                  Following the Closing, Seller shall cooperate with Buyer to secure
                  the removal
                  of all of Seller’s signage at the Totowa Property.

                 

                8.    Conditions
                  Precedent to Obligations of Buyer.
                  All
                  obligations of Buyer to consummate the Transactions are subject
                  to the
                  satisfaction (or waiver by Buyer) prior thereto of each of the
                  following
                  conditions:

                 

                8.1    Representations
                  and Warranties; Performance of Obligations.
                  All of
                  the representations and warranties of Seller contained in this
                  Agreement shall
                  have been when made on the date of this Agreement and shall be
                  on and as of the
                  Closing Date, with the same effect as though such representations
                  and warranties
                  had been made on and as of such date, true, correct and complete
                  in all material
                  respects (except in the case of representations and warranties
                  that are
                  qualified by materiality or Material Adverse Effect, which representations
                  and
                  warranties shall have been when made, and shall be on and as of
                  the Closing
                  Date, true, correct and complete); all of the terms, covenants,
                  agreements and
                  conditions of this Agreement to be complied with, performed or
                  satisfied by
                  Seller on or before the Closing Date shall have been duly complied
                  with,
                  performed or satisfied; and Buyer shall have received a certificate
                  dated the
                  Closing Date and signed by an executive officer of Seller to the
                  foregoing
                  effects (the “Seller
                  Officer’s Certificate”).

                 

                8.2    Closing
                  Documents.
                  Buyer
                  shall have received from each party thereto, other than Buyer,
                  executed original
                  counterparts (or, in lieu thereof, certified, facsimile or photostatic
                  copies,
                  the authenticity of which are reasonably acceptable to Buyer) of
                  the respective
                  Transaction Documents and the Deliverables identified in Section
                  3.2(a),
                  including without limitation certified copies of the Ancillary
                  Agreements (it
                  being understood that the receipt of the LNA from NJDEP shall not
                  be required
                  prior to Closing).

                 

                8.3    Closing
                  Consents.
                  Buyer
                  shall have received (in such forms as are reasonably acceptable
                  to Buyer)
                  originals of (a) all of Seller Required Consents set forth on Schedule
                  8.3
                  (the
“Closing
                  Consents”)
                  and
                  (b) any other Seller Required Consents, or in lieu thereof waivers,
                  obtained
                  prior to the Closing without any modification that Buyer deems
                  unacceptable in
                  the exercise of its reasonable discretion (it being understood
                  that the receipt
                  of the LNA from NJDEP shall not be required prior to Closing).

                 

                
                  
                    
                    

                  

                  
                    34

                    
                      

                    

                  

                  
                    
                    

                  

                

                8.4    [Reserved]

                 

                8.5    [Reserved]

                 

                8.6    Legal
                  Matters.
                  No
                  claim, action, suit, arbitration or other proceeding shall be pending
                  or shall
                  have been brought or threatened against Seller which seeks to restrain
                  or
                  questions the validity or legality of the Transactions. No Law
                  or Court Order
                  shall have been enacted, entered, promulgated or enforced by any
                  Governmental
                  Body that is in effect and has the effect of making the purchase
                  and sale of the
                  Purchased Assets illegal or otherwise prohibiting the consummation
                  of such
                  purchase and sale. 

                 

                8.7    Opinion
                  of Seller’s Counsel.
                  Buyer
                  shall have received an opinion of Seller’s counsel in substantially the form set
                  forth on Exhibit
                  D.
                  

                 

                9.    Conditions
                  Precedent to Obligations of Seller.
                  All
                  obligations of Seller to consummate the Transactions are subject
                  to the
                  satisfaction (or waiver by Seller to which the condition relates)
                  prior thereto
                  of each of the following conditions:

                 

                9.1    Representations
                  and Warranties; Performance of Obligations.
                  All of
                  the representations and warranties of Buyer contained in this Agreement
                  shall
                  have been when made on the date of this Agreement and shall be
                  on and as of the
                  Closing Date, with the same effect as though such representations
                  and warranties
                  had been made on and as of such date, true, correct and complete
                  in all material
                  respects (except in the case of representations and warranties
                  that are
                  qualified by materiality or Material Adverse Effect, which representations
                  and
                  warranties shall have been when made, and shall be on and as of
                  the Closing
                  Date, true, correct and complete); all of the terms, covenants,
                  agreements and
                  conditions of this Agreement to be complied with, performed or
                  satisfied by
                  Buyer on or before the Closing Date shall have been duly complied
                  with,
                  performed or satisfied; and Seller shall have received a certificate
                  dated the
                  Closing Date and signed by an executive officer of Buyer to the
                  foregoing
                  effects (the “Buyer
                  Officer’s Certificate”).

                 

                9.2    Legal
                  Matters.
                  No
                  claim, action, suit, arbitration, investigation or other proceeding
                  shall be
                  pending or shall have been brought or threatened against Buyer
                  which seeks to
                  restrain or questions the validity or legality of the Transactions.
                  No Law or
                  Court Order shall have been enacted, entered, promulgated or enforced
                  by any
                  Governmental Body that is in effect and has the effect of making
                  the purchase
                  and sale of the Purchased Assets illegal or otherwise prohibiting
                  the
                  consummation of such purchase and sale.

                 

                9.3    Consents.
                  Seller
                  shall have received consents in a form reasonably satisfactory
                  to Seller
                  effectuating the transfer of Seller’s obligations under the Totowa Property
                  Lease. 

                 

                10.   Indemnification.
                  

                 

                10.1    By
                  Seller. To the extent provided in this Section
                  10,
                  Seller
                  shall indemnify and hold Buyer and its Affiliates and their respective
                  successors and assigns, and their respective officers, directors,
                  employees,
                  stockholders, agents, (each, an “Indemnified
                  Buyer Party”)
                  harmless from and against:

                 

                (a)    any
                  Liabilities, claims, demands, judgments, losses, costs, damages
                  or expenses
                  whatsoever (including reasonable attorneys’ and other professional fees and
                  disbursements of every kind, nature and description incurred by
                  such Indemnified
                  Buyer Party in connection therewith) (collectively, “Damages”)
                  that
                  such Indemnified Buyer Party may sustain, suffer or incur and that
                  result from,
                  arise out of or relate to:

                 

                
                  
                    
                    

                  

                  
                    35

                    
                      

                    

                  

                  
                    
                    

                  

                

                (i)    any
                  inaccuracy of any representation or warranty made by Seller in
                  this Agreement,
                  the other Transaction Documents to which it is a party or any certificate
                  or
                  other writing delivered by or on behalf of either of it in connection
                  herewith
                  or therewith (for purposes of calculating the amount of Damages
                  incurred in
                  connection with any breach of any representation or warranty, any
                  and all
                  references to materiality or Material Adverse Effect contained
                  in such
                  representation or warranty shall be disregarded);

                 

                (ii)    any
                  nonfulfillment of any covenant or agreement on the part of Seller
                  or Safeguard
                  set forth in the Totowa Lease, the Termination and Option Agreement,
                  this
                  Agreement or any other Transaction Document to which either is
                  a party, other
                  than the Transition Services Agreement; 

                 

                (iii)   any
                  Unassumed Liability; 

                 

                (iv)    any
                  commissions, fees and expenses of any brokers or finders retained
                  by or on
                  behalf Seller or its Affiliates in connection with the
                  Transactions;

                 

                (v)    any
                  agreement, relationship or arrangement between Seller and any customer
                  of Seller
                  other than Buyer, including, but not limited to, the DAS Agreement;

                 

                provided,
                  however, that notwithstanding anything to the contrary herein,
                  Buyer shall not
                  be entitled to recover Damages under this Agreement resulting from
                  or arising
                  out of a Default by Seller in the performance of its obligations
                  under the
                  Existing Manufacturing Agreement, which shall be governed solely
                  by the terms of
                  the Existing Manufacturing Agreement; and

                 

                (b)    any
                  and
                  all actions, suits, claims, proceedings, investigations, allegations,
                  demands,
                  assessments, audits, fines, judgments, costs and other expenses
                  (including
                  reasonable attorneys’ fees and expenses) incident to any of the foregoing or to
                  the enforcement of this Section
                  10.1.

                 

                10.2    By
                  Buyer.
                  To the
                  extent provided in this Section
                  10,
                  Buyer
                  shall indemnify and hold Seller, its Affiliates and their respective
                  successors
                  and assigns, and their respective officers, directors, employees,
                  partners,
                  agents (each, an “Indemnified
                  Seller Party”)
                  harmless from and against:

                 

                (a)    any
                  Damages that such Indemnified Seller Party may sustain, suffer
                  or incur and that
                  result from, arise out of or relate to:

                 

                (i)    any
                  inaccuracy of any representation or warranty made by Buyer in this
                  Agreement,
                  the Transaction Documents or any certificate or other writing delivered
                  by or on
                  behalf of it in connection herewith or therewith (for purposes
                  of calculating
                  the amount of Damages incurred in connection with any breach of
                  any
                  representation or warranty, any and all references to materiality
                  or Material
                  Adverse Effect contained in such representation or warranty shall
                  be
                  disregarded);

                 

                (ii)    any
                  nonfulfillment of any covenant or agreement on the part of Buyer
                  set forth in
                  this Agreement or any Transaction Document, other than the Transition
                  Services
                  Agreement;

                 

                (iii)    any
                  Assumed Liability; 

                
                   

                  
                    
                      
                      

                    

                    
                      36

                      
                        

                      

                    

                    
                      
                      

                    

                  

                  (iv)    any
                    commissions, fees and expenses of any brokers or finders retained
                    by or on
                    behalf of Buyer or its Affiliates in connection with the Transactions;
                    and

                   

                  (v)    except
                    as
                    may be provided in the Transition Services Agreement, the operation
                    of Buyer’s
                    business following the Closing.

                   

                  (b)    any
                    and
                    all actions, suits, claims, proceedings, investigations, allegations,
                    demands,
                    assessments, audits, fines, judgments, costs and other expenses
                    (including
                    reasonable attorneys’ fees and expenses) incident to any of the foregoing or to
                    the enforcement of this Section
                    10.2.

                   

                  10.3    Procedure
                    for Claims.

                   

                  (a)    An
                    Indemnified Party that desires to seek indemnification under
                    any part of this
Section
                    10
                    shall
                    give notice (a “Claim
                    Notice”)
                    to
                    each party responsible or alleged to be responsible for indemnification
                    hereunder (an “Indemnitor”)
                    prior
                    to any applicable Expiration Date specified below. Such notice
                    shall briefly
                    explain the nature of the claim and the parties known to be involved,
                    and shall
                    specify the amount thereof. If the matter to which a claim relates
                    shall not
                    have been resolved as of the date of the Claim Notice, the Indemnified
                    Party
                    shall estimate the amount of the claim in the Claim Notice, but
                    also specify
                    therein that the claim has not yet been liquidated (an “Unliquidated
                    Claim”).
                    If an
                    Indemnified Party gives a Claim Notice for an Unliquidated Claim,
                    the
                    Indemnified Party shall also give a second Claim Notice (the
“Liquidated
                    Claim Notice”)
                    within
                    60 days after the matter giving rise to the claim becomes finally
                    resolved, and
                    the Liquidated Claim Notice shall specify the amount of the claim.
                    Each
                    Indemnitor to which a Claim Notice is given shall respond to
                    any Indemnified
                    Party that has given a Claim Notice (a “Claim
                    Response”)
                    within
                    20 days (the “Response
                    Period”)
                    after
                    the later of (i) the date that the Claim Notice is given
                    and (ii) if a
                    Claim Notice is first given with respect to an Unliquidated Claim,
                    the date on
                    which the Liquidated Claim Notice is given. Any Claim Notice
                    or Claim Response
                    shall be given in accordance with the notice requirements hereunder,
                    and any
                    Claim Response shall specify whether or not the Indemnitor giving
                    the Claim
                    Response disputes the claim described in the Claim Notice. If
                    any Indemnitor
                    fails to give a Claim Response within the Response Period, such
                    Indemnitor shall
                    be deemed not to dispute the claim described in the related Claim
                    Notice. If any
                    Indemnitor elects not to dispute a claim described in a Claim
                    Notice, whether by
                    failing to give a timely Claim Response or otherwise, then the
                    amount of such
                    claim shall be conclusively deemed to be an obligation of such
                    Indemnitor.

                   

                  (b)    If
                    any
                    Indemnitor shall be obligated to indemnify an Indemnified Party
                    under this
Section
                    10,
                    such
                    Indemnitor shall pay to such Indemnified Party within 30 days
                    after the last day
                    of the Response Period the amount to which such Indemnified Party
                    shall be
                    entitled. If there shall be a dispute as to the amount or manner
                    of
                    indemnification under this Section
                    10,
                    the
                    Indemnified Party may pursue whatever legal remedies may be available
                    for
                    recovery of the Damages claimed from any Indemnitor, but any
                    dispute shall be
                    resolved in accordance with Section
                    13.5
                    to the
                    extent that it may be applicable. If any Indemnitor fails to
                    pay all or part of
                    any indemnification obligation when due, then such Indemnitor
                    shall also be
                    obligated to pay to the applicable Indemnified Party interest
                    on the unpaid
                    amount for each day during which the obligation remains unpaid
                    at an annual rate
                    equal to the Prime Rate, and the Prime Rate in effect on the
                    first Business Day
                    of each calendar quarter shall apply to the amount of the unpaid
                    obligation
                    during such calendar quarter.

                   

                  10.4    Limitations
                    on Liability.

                   

                  
                    
                      
                      

                    

                    
                      37

                      
                        

                      

                    

                    
                      
                      

                    

                  

                  (a)    Notwithstanding
                    any other provision of this Section
                    10,
                    an
                    Indemnified Buyer Party shall be entitled to indemnification
                    with respect to
                    claims under Section
                    10.1(a)(i)
                    hereunder only when the aggregate of all Damages to all Indemnified
                    Buyer
                    Parties exceeds $75,000 (the “Threshold
                    Amount”)
                    and
                    then the Indemnified Buyer Parties shall be entitled to indemnification
                    for all
                    Damages incurred in the
                    aggregate in excess
                    of
$20,000
                    (the “Deductible
                    Amount”).
                    Except as otherwise expressly provided in
                    this
Section
                    10.4,
                    Seller’s obligation to indemnify the Indemnified Buyer Parties under
                    Section
                    10.1(a)(i)
                    shall not exceed in the aggregate
                    an
                    amount equal to the Purchase Price (the “Purchase
                    Price Cap”);
                    provided, further,
                    that Seller’s obligation to indemnify the Indemnified Buyer Parties under
                    Section
                    10.1(a)(i)
                    with respect to Sections 4.1,
                    4.4,
                    4.10,
                    4.12,
                    4.14
                    (except Sections 4.14(c)(i),
                    4.14(c)(iii)
                    and 4.14(c)(v)),
                    4.15
                    (except with respect to the Totowa Lease and the Termination
                    and Option
                    Agreement), 4.17,
                    4.18,
                    4.19,
                    4.20,
                    4.21,
                    4.28
                    and 4.33
                    shall not exceed, in the aggregate, an amount equal to 33% of
                    the Purchase Price
                    (the “33%
                    Cap”).
                    For
                    the avoidance of doubt, any payments made to an Indemnified Buyer
                    Party that are
                    subject to the 33% Cap pursuant to this Section
                    10.4(a)
                    shall
                    also be applied against the Purchase Price Cap. The
                    Purchase Price Cap, but none of
                    the
                    Threshold Amount,
                    the
Deductible
                    Amount or the 33% Cap,
                    shall
                    apply to the representations and
                    warranties set forth in Sections 4.3,
                    4.13,
                    4.14(c)(i),
                    4.14(c)(iii),
                    4.14(c)(v),
                    4.15
                    (solely
                    with respect to the Totowa Lease
                    and the Termination and Option Agreement)
                    and
4.16.
                    The Purchase Price Cap, the
                    Threshold Amount and the Deductible
                    Amount but not the 33% Cap
                    shall
                    apply to the representations and
                    warranties set forth in Sections 4.31
                    and
4.32.
                    Notwithstanding anything in this Section
                    10.4
                    to the contrary, none of the Threshold Amount, the Deductible
                    Amount, the
                    Purchase Price Cap or the 33% Cap shall apply to the representations
                    and
                    warranties set forth in Sections
                    4.7,
                    4.11,
                    4.13, 4.15
                    (solely
                    with respect to the Totowa Lease and the Termination and Option
                    Agreement),
4.22,
                    4.24
                    and 4.26.
                    For the
                    avoidance of doubt, none of the foregoing limitations shall apply
                    with respect
                    to Seller’s obligation to indemnify the Indemnified Buyer Parties under
                    Sections
                    10.1(a)(ii),
                    (a)(iii),
                    (a)(iv)
                    and
(a)(v).
                    In
                    addition, except as expressly provided to the contrary herein,
                    in the case of a
                    claim for Damages that may be made based on items set forth in
                    more than one of
                    clauses (a)(i) through (a)(iv) of Section
                    10.1(a),
                    an
                    Indemnified Buyer Party make may such claim based on any one
                    of the clauses in
Section
                    10.1(a),
                    except
                    to the extent that such claim is based solely on only one of
                    such clauses.

                   

                  (b)    Any
                    claim
                    for indemnification under this Section
                    10
                    shall be
                    made by giving a Claim Notice under Section
                    10.3
                    on or
                    before the applicable “Expiration Date” specified below in this Section
                    10.4(b),
                    or the
                    claim under this Section shall be invalid. “Expiration
                    Date”
                    means:

                   

                  (i)    60
                    days
                    after the date on which the applicable statute of limitations
                    expires (with
                    extensions) with respect to any claim for Damages related to
                    (A) the inaccuracy
                    of a representation or warranty set forth in Sections
                    4.7,
                    4.14(c)(i),
                    4.14(c)(iii), 4.14(c)(v),
                    4.16
                    or
4.22,
                    or (B)
                    the inaccuracy of any representations or warranties of Seller
                    or Buyer that were
                    untrue when made with an intent to mislead or defraud; 

                   

                  (ii)    eighteen
                    months following the Closing Date, with respect to any claim
                    for Damages related
                    to (A) any breach of a representation or warranty set forth in
Sections
                    4.15
                    (other
                    than with respect to the matters addressed by Section
                    10.4(b)(iii)
                    below),
4.17,
                    4.18,
                    4.31,
                    4.33
                    or (B)
Sections
                    10.1(a)(ii) or 10.2(a)(ii);
                    provided, however, in the event that any covenant or agreement
                    is required to be
                    performed beyond such date pursuant to the terms of the Transaction
                    Documents,
                    claims for indemnification under Sections
                    10.1(a)(ii) or 10.2(a)(ii)
                    for
                    breach of such covenant or agreement shall be made before the
                    expiration of the
                    120 calendar day period commencing on the date established for
                    completion of
                    performance of such covenant or agreement;

                   

                  (iii)    with
                    respect to any Claim arising in connection with the Totowa Lease
                    and the
                    Termination and Option Agreement, 60 days after the earlier of
                    the termination
                    of the Totowa Lease or the expiration of the initial term of
                    the Totowa Lease,
                    without regard to any extension thereto.

                   

                  
                    
                      
                      

                    

                    
                      38

                      
                        

                      

                    

                    
                      
                      

                    

                  

                  (iv)    in
                    perpetuity, with respect to any claim for Damages related to
                    (A) any breach of a
                    representation or warranty set forth in Sections
                    4.3,
                    4.4,
                    4.11,
                    4.24,
                    4.26 or
                    5.2
                    or (B)
Sections 10.1(a)(iii),
                    (a)(iv)
                    or (a)(v)
                    or 10.2(a)(iii),
                    (a)(iv)
                    or
(a)(v);
                    and

                   

                  (v)    one
                    year
                    following the Closing Date for all other claims;
                    provided, however, in the event that the current term of any
                    Seller Contract
                    ends on a date beyond such date, claims for indemnification with
                    respect to such
                    Seller Contract shall be made before the expiration of the 120
                    calendar day
                    period commencing on the last day of the current term of such
                    Seller
                    Contract.

                   

                  (vi)    in
                    the
                    event that a claim for Damages may be made based on items to
                    which more than one
                    of clauses (b)(i) through (b)(v) of this Section
                    10.4
                    shall
                    apply, an Indemnified Buyer Party may make such claim on or before
                    the later of
                    the applicable Expiration Dates provided hereunder. 

                   

                  So
                    long
                    as an Indemnified Party gives a Claim Notice for an Unliquidated
                    Claim on or
                    before the applicable Expiration Date, such Indemnified Party
                    shall be entitled
                    to pursue its rights to indemnification regardless of the date
                    on which such
                    Indemnified Buyer Party gives the related Liquidated Claim Notice.

                   

                  (c)    Except
                    to
                    the extent specifically contemplated to the contrary herein,
                    for purposes of
                    this Section
                    10,
                    “Damages” shall include incidental damages, but shall not include indirect
                    and
                    consequential damages (including lost profits) punitive, exemplary
                    or special
                    damages, except to the extent paid to a third party.

                   

                  (d)    For
                    purposes of this Section
                    10,
                    “Damages” shall be net of any insurance recoveries paid to the Indemnified
                    Party
                    in connection with the matter giving rise to the right of indemnification;
                    provided, however, that except as described below, no Party shall
                    have any
                    obligation to obtain insurance coverage. Each Indemnified Party
                    shall use
                    commercially reasonable efforts to exercise its rights under
                    insurance carried
                    by such Indemnified Party from which recoveries may be obtained
                    in connection
                    with the matter giving rise to the right of indemnification;
                    provided, however,
                    that the exercise of commercially reasonable efforts in this
                    regard shall not
                    include having to litigate to obtain a recovery from an insurance
                    provider.

                   

                  (e)    Seller
                    shall have no Liability to Buyer as a result of any termination
                    of, delay in, or
                    failure to achieve, regulatory approval of Buyer’s NDA that may be due to the
                    pendency of, or otherwise caused by, the Transactions. 

                   

                  10.5    Third
                    Party Claims.
                    

                   

                  (a)    An
                    Indemnified Party that desires to seek indemnification under
                    any part of this
Section
                    10
                    with
                    respect to any actions, suits or other administrative or judicial
                    proceedings
                    (each, an “Action”)
                    that
                    may be instituted by a third party (a “Third-Party
                    Claim”)
                    shall
                    give each Indemnitor prompt written notice of a third party’s institution of
                    such Action. After such notice, any Indemnitor shall be entitled
                    to participate
                    in such Action or assume the defense thereof with counsel chosen
                    by the
                    Indemnitor, which counsel shall be reasonably satisfactory to
                    such Indemnified
                    Party. Any failure to give prompt notice under this Section
                    10.5
                    shall
                    not bar an Indemnified Party’s right to claim indemnification under this
Section
                    10,
                    except
                    to the extent that an Indemnitor shall have been materially prejudiced
                    as a
                    result of such failure. The Indemnified Party shall cooperate
                    in all reasonable
                    aspects with the Indemnitor’s defense of any such Action.

                   

                  
                    
                      
                      

                    

                    
                      39

                      
                        

                      

                    

                    
                      
                      

                    

                  

                  (b)    After
                    assumption of the defense of such Third-Party Claim by the Indemnitor,
                    the
                    Indemnitor shall not, so long as it diligently conducts such
                    defense, be liable
                    to the Indemnified Party under this Section
                    10
                    for any
                    fees of other counsel or any other expenses with respect to the
                    defense of such
                    Third-Party Claim, in each case subsequently incurred by the
                    Indemnified Party
                    in connection with the defense of such Third-Party Claim, other
                    than costs
                    incurred by the Indemnified Party prior to such assumption by
                    the
                    Indemnitor,
                    except that, in the event the Indemnified Party shall have received
                    an opinion
                    of counsel to the effect that the interests of the Indemnitor
                    and the
                    Indemnified Party in the Third Party Claim are adverse and require
                    that the
                    Parties be separately represented, the Indemnitor shall pay the
                    reasonable costs
                    and counsel fees of one separate counsel to represent the Indemnified
                    Party.
                    If the
                    Indemnitor assumes the defense of a Third-Party Claim, (i) such
                    assumption will
                    conclusively establish for purposes of this Agreement that the
                    claims made in
                    that Third-Party Claim are within the scope of and subject to
                    indemnification
                    pursuant to this Section
                    10,
                    and
                    (ii) the Indemnitor shall have the sole right to compromise and
                    settle such
                    Action; provided that, the Indemnitor shall obtain the written
                    consent of the
                    Indemnified Party, prior to ceasing to defend, settling or otherwise
                    disposing
                    of any such Action if as a result thereof (i) the Indemnified
                    Party would become
                    subject to injunctive or other equitable relief or any remedy
                    other than the
                    payment of money by the Indemnitor, or (ii) the business of the
                    Indemnified
                    Party would be adversely affected (including, without limitation,
                    any admission
                    of liability). Notwithstanding the assumption by the Indemnitor
                    of the defense
                    of any Third-Party Claim as provided in this Section
                    10.5,
                    the
                    Indemnified Party shall have the right to participate at its
                    own expense in the
                    defense of such Action.

                   

                  10.6    Right
                    of Offset.
                    An
                    Indemnified Party shall be entitled, at its sole discretion,
                    to recover any
                    Damages payable by the Indemnitor which are not subject to a
                    defense or dispute
                    raised in good faith by Indemnitor through a reduction of amounts
                    due from the
                    Indemnified Party to the Indemnitor to the extent any amounts
                    are then or will
                    in the future become payable by the Indemnified Party to the
                    Indemnitor;
provided,
                    however,
                    that,
                    except for claims brought by a Buyer Indemnified Party under
Sections
                    10.1(a)(i)
                    (solely
                    with respect to Sections
                    4.3,
                    4.4,
                    4.7,
                    4.11,
                    4.22
                    and
4.24),
                    10.1(a)(ii),
                    (a)(iii),
                    (a)(iv)
                    and
(a)(v),
                    no such
                    amounts shall be offset against payments due Seller under the
                    Transition
                    Services Agreement. The right of offset provided to Indemnified
                    Parties under
                    this Section 10.6 shall not, in any event, have the effect of
                    modifying,
                    extending, restructuring or otherwise deferring the obligations
                    of an Indemnitor
                    to pay when due the amounts provided under this Article 10. 

                   

                  10.7    Effect
                    of Investigation or Knowledge.
                    Any
                    claim by an Indemnified Party for indemnification shall not be
                    adversely
                    affected by any investigation by or opportunity to investigate
                    afforded to the
                    Indemnified Party, nor shall such a claim be adversely affected
                    by Buyer’s
                    knowledge on or before the Closing Date of any breach of the
                    type specified in
Section
                    10.1
                    or of
                    any state of facts that may give rise to such a breach; any such
                    claim shall
                    survive the Closing until the applicable Expiration Date. The
                    waiver of any
                    condition based on the accuracy of any representation or warranty,
                    or on the
                    performance of or compliance with any covenant or obligation,
                    will not adversely
                    affect the right to indemnification, payment of Damages or other
                    remedy based on
                    such representations, warranties, covenants or obligations.

                   

                  10.8    Contingent
                    Claims. Nothing herein shall be deemed to prevent an Indemnified
                    Party from
                    making a claim hereunder for potential or contingent claims or
                    demands (a
“Contingent
                    Claim”);
                    provided that the Claim Notice sets forth the specific basis
                    for any such
                    Contingent Claim to the extent then feasible and the Indemnified
                    Party has
                    reasonable grounds to believe that such a claim may be made.

                   

                  11.    Termination.
                    

                   

                  11.1    Grounds
                    for Termination.
                    The
                    Parties may terminate this Agreement at any time before the Closing
                    as provided
                    below:

                   

                  (a)    by
                    mutual
                    written consent of each of the Parties;

                   

                  
                    
                      
                      

                    

                    
                      40

                      
                        

                      

                    

                    
                      
                      

                    

                  

                  
                    (b)    by
                      any
                      Party, if the Closing shall not have been consummated on or
                      before December 31,
                      2005 (the “Termination
                      Date”);
                      provided, however, that the right to terminate this Agreement
                      under this
Section
                      11.1(b)
                      shall
                      not be available to any Party whose failure to fulfill any
                      obligation under this
                      Agreement has been the cause of, or resulted in, the failure
                      of the Closing to
                      occur on or before the Termination Date;

                     

                    (c)    by
                      any
                      Party, if a Governmental Body shall have issued a Court Order
                      (which Court Order
                      the Parties shall use commercially reasonable efforts to lift)
                      that permanently
                      restrains, enjoins or otherwise prohibits the Transactions,
                      and such Court Order
                      shall have become final and nonappealable;

                     

                    (d)    by
                      Buyer,
                      if Seller shall have breached, or failed to comply with, any
                      of their
                      obligations under this Agreement or any representation or warranty
                      made by
                      Seller shall have been incorrect when made, and such breach,
                      failure or
                      misrepresentation is not cured within 20 days after notice
                      thereof, and in
                      either case, any such breaches, failures or misrepresentations,
                      individually or
                      in the aggregate, results or would reasonably be expected to
                      result in a
                      Material Adverse Effect on the Business; or

                     

                    (e)    by
                      Seller, if Buyer shall have breached, or failed to comply with
                      any of its
                      obligations under this Agreement or any representation or warranty
                      made by Buyer
                      shall have been incorrect when made, and such breach, failure
                      or
                      misrepresentation is not cured within 20 days after notice
                      thereof, and in
                      either case, any such breaches, failures or misrepresentations,
                      individually or
                      in the aggregate, results or would reasonably be expected to
                      affect materially
                      and adversely the benefits to be received by Seller hereunder.

                     

                    11.2    Effect
                      of Termination.
                      If this
                      Agreement is terminated pursuant to this Section
                      11,
                      the
                      agreements contained in Section
                      13.6
                      shall
                      survive the termination hereof and any Party may pursue any
                      legal or equitable
                      remedies that may be available if such termination is based
                      on a breach of
                      another Party.

                     

                    12.    Other
                      Matters.

                     

                    12.1    Public
                      Announcements.
                      Except
                      as and to the extent Parties may be required by applicable
                      Law or any applicable
                      stock exchange regulations, without the prior written consent
                      of the other
                      Party, neither Party will, and each will direct and cause its
                      officers,
                      directors, employees, attorneys, accountants and other agents
                      and
                      representatives not to, directly or indirectly, make any public
                      disclosure of or
                      statement concerning this Agreement and the Transactions.

                     

                    12.2    Reasonable
                      Best Efforts.
                      Between
                      the date of this Agreement and the Closing Date, Seller will
                      use its reasonable
                      best efforts to cause the conditions in Sections
                      8
                      to be
                      satisfied.

                     

                    12.3    Nondisparagement.
                      Buyer
                      and
                      Seller each agree not to communicate, directly or indirectly,
                      any untrue,
                      inaccurate or negative or disparaging comments or information
                      about each other
                      (including, as appropriate, any of the current or former officers,
                      directors,
                      managers, supervisors, employees or representatives of Buyer
                      or Seller or any of
                      their related entities) concerning the reputation or status
                      of the other party's
                      professional abilities, business or financial condition.

                     

                    13.    Miscellaneous.

                     

                    13.1    Contents
                      of Agreement.
                      This
                      Agreement, together with the other Transaction Documents, that
                      certain
                      Confidentiality Agreement dated February 10, 2003 between the
                      Parties
                      (“Confidentiality
                      Agreement”),
                      and
                      the Existing Manufacturing Agreement sets forth the entire
                      understanding of the
                      parties hereto with respect to the Transactions and supersedes
                      all prior
                      agreements or understandings among the Parties regarding those
                      matters. In
                      clarification of the foregoing, nothing herein shall serve
                      to limit in any
                      respect the existing rights and obligations of the Parties
                      under the Existing
                      Manufacturing Agreement as of the Closing. Furthermore, the
                      Parties agree that
                      the Existing Manufacturing Agreement, including, without limitation,
                      the Change
                      Order and Change Order No. 2 and any obligation of Buyer to
                      pay a success fee to
                      Seller, shall terminate as of the Closing and, except for such
                      provisions
                      therein that by their terms survive such termination, Seller
                      shall have no
                      further obligations thereunder; provided, however, that, except
                      as otherwise
                      provided in this Agreement, neither Buyer nor Seller shall
                      be relieved of any of
                      its obligations thereunder relating to periods prior to the
                      Closing.

                     

                    
                      
                        
                        

                      

                      
                        41

                        
                          

                        

                      

                      
                        
                        

                      

                    

                    13.2    Amendment,
                      Parties in Interest, Assignment, Etc.
                      This
                      Agreement may be amended, modified or supplemented only by
                      a written instrument
                      duly executed by each of the Parties. If any provision of this
                      Agreement shall
                      for any reason be held to be invalid, illegal, or unenforceable
                      in any respect,
                      such invalidity, illegality, or unenforceability shall not
                      affect any other
                      provision hereof, and this Agreement shall be construed as
                      if such invalid,
                      illegal or unenforceable provision had never been contained
                      herein. This
                      Agreement shall be binding upon and inure to the benefit of
                      and be enforceable
                      by the respective heirs, legal representatives, successors
                      and permitted assigns
                      of the Parties. No Party shall assign this Agreement or any
                      right, benefit or
                      obligation hereunder, except that Buyer shall be entitled to
                      assign its rights
                      and obligations hereunder to one or more Persons (an “Assignee”)
                      provided (a) the Assignee executes and delivers to Seller a
                      document by which
                      the Assignee agrees to be bound by the terms and conditions
                      applicable to Buyer
                      under this Agreement, and (b) Buyer shall remain obligated
                      to purchase the
                      Assets to be purchased by an Assignee hereunder and to fulfill
                      the Assignee’s
                      other obligations hereunder to the extent that the Assignee
                      fails to do so
                      hereunder. Any term or provision of this Agreement may be waived
                      at any time by
                      the Party entitled to the benefit thereof by a written instrument
                      duly executed
                      by such Party. The Parties shall execute and deliver any and
                      all documents and
                      take any and all other actions that may be deemed reasonably
                      necessary by their
                      respective counsel to complete the Transactions.

                     

                    13.3    Interpretation.
                      Unless
                      the context of this Agreement clearly requires otherwise, (a)
                      references to the
                      plural include the singular, the singular the plural, the part
                      the whole, (b)
                      references to any gender include all genders, (c) “or” has the inclusive meaning
                      frequently identified with the phrase “and/or,” (d) “including” has the
                      inclusive meaning frequently identified with the phrase “but not limited to,”
                      and (e) references to “hereunder” or “herein” relate to this Agreement. The
                      section and other headings contained in this Agreement are
                      for reference
                      purposes only and shall not control or affect the construction
                      of this Agreement
                      or the interpretation thereof in any respect. Section, subsection,
                      schedule and
                      exhibit references are to this Agreement unless otherwise specified.
                      Each
                      accounting term used herein that is not specifically defined
                      herein shall have
                      the meaning given to it under GAAP.

                     

                    13.4    Sole
                      Remedy.
                      The
                      Parties acknowledge that the remedies provided for in this
                      Agreement shall be
                      the Parties’ sole and exclusive remedy with respect to breaches of the
                      representations and warranties contained in this Agreement.
                      Notwithstanding any
                      other provision in this Agreement, either Party shall have
                      the right to seek
                      specific performance or injunctive relief to enforce another
                      Party’s performance
                      of any obligations expressly set forth in this Agreement.

                     

                    13.5    Dispute
                      Resolution.

                     

                    (a)    Good-Faith
                      Negotiations.
                      Except
                      as otherwise set forth in this Agreement, if after the Closing
                      any dispute
                      arises under this Agreement with respect to a claim for Damages
                      that is not
                      settled promptly in the ordinary course of business, the Parties
                      shall seek to
                      resolve any such dispute between them, first, by negotiating
                      promptly with each
                      other in good faith in face-to-face negotiations. These face-to-face
                      negotiations shall be conducted by the respective designated
                      senior management
                      representatives of Buyer and Seller. If the Parties are unable
                      to resolve such
                      dispute between them within 20 Business Days (or such period
                      as the Parties
                      shall otherwise agree) through these face-to-face negotiations,
                      then any such
                      dispute shall be resolved in the manner set forth in this Section.

                     

                    
                      
                        
                        

                      

                      
                        42

                        
                          

                        

                      

                      
                        
                        

                      

                    

                    (b)    Resolution
                      of Disputes.
                      Except
                      as otherwise set forth in this Agreement, any controversy or
                      claim shall be
                      settled by arbitration conducted on a confidential basis, under
                      the US
                      Arbitration Act, if applicable, and the then current Commercial
                      Arbitration
                      Rules of the American Arbitration Association (the “Association”)
                      strictly in accordance with the terms of this Agreement and
                      the substantive law
                      of the State of New Jersey. The arbitration shall be conducted
                      at the
                      Association’s regional office located in Philadelphia, Pennsylvania by
                      three
                      arbitrators, at least one of whom shall be knowledgeable in
                      the bioprocessing
                      industry, one of whom shall be an attorney and one of whom
                      shall be a member of
                      an accounting firm familiar with businesses engaged in bioprocessing.
                      Judgment
                      upon the arbitrators’ award may be entered and enforced in any court of
                      competent jurisdiction. No Party shall institute a proceeding
                      hereunder unless
                      at least 60 days prior thereto such Party shall have given
                      written notice to the
                      other Parties of its intent to do so. No Party shall be precluded
                      hereby from
                      securing equitable remedies in courts of any jurisdiction,
                      including temporary
                      restraining orders and preliminary injunctions to protect its
                      rights and
                      interests, but neither Party shall seek any such equitable
                      remedies as a means
                      to avoid or stay arbitration.

                     

                    13.6    Expenses.
                      Except
                      as otherwise set forth herein, the Parties shall pay their
                      own expenses
                      incidental to the preparation of this Agreement, the carrying
                      out of the
                      provisions of this Agreement and the consummation of the
                      Transactions.

                     

                    13.7    Bulk
                      Sales.
                      The
                      Parties hereby waive compliance with the bulk sales Laws, sales
                      and use tax laws
                      and any other similar Laws in any applicable jurisdiction in
                      respect of the sale
                      and purchase by Seller and Purchaser, respectively, of the
                      Purchased Assets as
                      contemplated hereby; provided,
                      however,
                      that
                      Seller shall pay and discharge when due all claims of creditors
                      asserted against
                      Buyer or the Purchased Assets by reason of such noncompliance
                      and all sales,
                      use, and other Taxes assessed against or sought to be collected
                      from Buyer by
                      any Governmental Body as a result of such noncompliance and
                      Seller promptly
                      shall take all necessary actions required to remove any Encumbrance
                      which may be
                      placed upon any of the Purchased Assets by reason of such noncompliance.
                      In
                      accordance with the provisions of Section
                      10,
                      Seller
                      shall indemnify and hold Buyer and the Buyer Indemnified Parties
                      harmless from
                      and against any and all Taxes and Damages resulting from or
                      arising out of any
                      noncompliance or alleged noncompliance with bulk sales Laws,
                      sales and use tax
                      laws and any other similar Laws in any applicable jurisdiction
                      in respect of the
                      sale and purchase by Seller and Purchaser, respectively, of
                      the Purchased Assets
                      as contemplated hereby.

                     

                    13.8    Notices.
                      All
                      notices that are required or permitted hereunder shall be in
                      writing and shall
                      be sufficient if personally delivered or sent by mail, facsimile
                      message or by a
                      nationally recognized overnight delivery courier. Any notices
                      shall be deemed
                      given upon the earlier of the date when received at, or the
                      third day after the
                      date when sent by registered or certified mail or the day after
                      the date when
                      sent by overnight delivery courier to, the address or fax number
                      set forth
                      below, unless such address or fax number is changed by notice
                      to the other party
                      hereto:

                     

                    
                      
                        
                        

                      

                      
                        43

                        
                          

                        

                      

                      
                        
                        

                      

                    

                    If
                      to
                      Seller:

                    

                    Laureate
                      Pharma, Inc.

                    201
                      College Road East

                    Princeton,
                      New Jersey 08540

                    FAX:
                      (609) 520-3963

                    Attention:
                      Dr. Robert J. Broeze

                    

                    and
                      with
                      a required copy to:

                    

                    Morgan,
                      Lewis & Bockius LLP

                    1701
                      Market Street

                    Philadelphia,
                      Pennsylvania 19103

                    FAX:
                      (215) 963-5001

                    Attention:
                      Richard B. Aldridge

                    

                    and
                      with
                      a required copy to:

                    

                    Safeguard
                      Scientifics, Inc.

                    800
                      The
                      Safeguard Building

                    435
                      Devon
                      Park Drive

                    Wayne,
                      Pennsylvania 19087

                    FAX:
                      (610) 975-0261

                    Attn:
                      General Counsel

                    

                    If
                      to
                      Buyer:

                    

                    Discovery
                      Laboratories, Inc.

                    2600
                      Kelly Road

                    Suite
                      100

                    Warrington,
                      PA 18976-3646

                    FAX:
                      215-488-9557

                    Attention:
                      David L. Lopez, Esq., SVP & General Counsel

                    

                    and
                      with
                      a required copy to:

                    

                    Taylor,
                      Colicchio & Silverman, LLP 

                    502
                      Carnegie Center

                    Suite
                      103

                    Princeton,
                      New Jersey 08540

                    FAX:
                      609-987-0070

                    Attention:
                      Thomas P. Wild, Esq.

                    

                    13.9    Governing
                      Law.
                      This
                      Agreement shall be construed and interpreted in accordance
                      with the laws of the
                      State of New Jersey without regard to its provisions concerning
                      conflict of
                      laws.

                     

                    13.10   Counterparts.
                      This
                      Agreement may be executed in two or more counterparts and by
                      facsimile, each of
                      which shall be binding as of the date first written above,
                      and all of which
                      shall constitute one and the same instrument. Each such copy
                      shall be deemed an
                      original, and it shall not be necessary in making proof of
                      this Agreement to
                      produce or account for more than one such counterpart.

                    
                      
                        
                        

                      

                      
                        44

                        
                          

                        

                      

                      
                        
                        

                      

                    

                     

                    [Remainder
                      of the page intentionally left blank]

                     

                    
                      
                        
                        

                      

                      
                        45

                        
                          

                        

                      

                      
                        
                        

                      

                    

                    IN
                      WITNESS WHEREOF, this Agreement has been executed by the parties
                      hereto as of
                      the day and year first written above.

                     

                    
                      	 	 
	 	
                              LAUREATE
                                PHARMA, INC.

                               

                               

                              By:   
                                /s/
                                Christopher J. Davis    

                              Name:
                                Christopher J. Davis

                              Title:
                                Vice President and Treasurer

                            
	 	 
	 	
                              DISCOVERY
                                LABORATORIES, INC.

                               

                               

                              By:  
                                /s/
                                Robert J. Capetola        

                              Name:
                                Robert J. Capetola, Ph.D.

                              Title:
                                President and Chief Executive OfficerRECISSION AGREEMENT

      THIS  AGREEMENT IS AMONG THE PARTIES  ENUMERATED IN THE SIGNATURE  BLOC AT
THE END OF THIS DOCUMENT AND IS DATED AS OF THE 27TH DAY OF DECEMBER 2005.

      REFERENCE  IS MADE to an  Agreement  for Merger (the  "Merger  Agreement")
dated as of June 30,  2005 among  Dialog  Group,  Inc.,  a Delaware  corporation
("DGI"),  AdValiant Acquisition Corp.  ("Acquisition"),  a Delaware corporation,
AdValiant Inc., a corporation  organized under the Ontario Business Corporations
Act ("AdValiant"), AdValiant USA, Inc. a Delaware corporation ("AdValiant USA"),
and Empire Media, Inc., a Delaware  corporation,  Matthew Wise, and Jivan Manhas
(the last three are collectively referred to as the "Shareholders").

      FURTHER  REFERENCE  IS MADE to several  agreements  among the same parties
executed  pursuant  to  Sections  2.01(d)  and  8.01  of the  Merger  Agreement,
specifically  the  Voting  and  Exchange  Trust  Agreement  (the  "Voting  Trust
Agreement"), the Support Agreement, and the Escrow Agreement.

                                    RECITALS

      1.    The  parties  desire to reverse the effects of the Merger and return
to the status quo anti.

      2.    DGI has agreed with the Shareholders to sell control of AdValiant to
its original  owners in exchange for the  cancellation  of the right to exchange
AdValiant Exchangeable Shares for Dialog Group Common Stock, cancellation of the
Exchangeable Shares, return of the DGI Preferred Voting Shares, and repayment of
both  $185,000 of funds  advanced by  Commodore  Factors and $57,000 of expenses
incurred by DGI in the transaction.

      3.    All terms  used in the above  referenced  agreements  shall have the
same meaning herein.

      NOW, THEREFORE, in consideration of the mutual promises and covenants
contained in this Agreement, and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the Parties agree that
the Recitals and References set forth above are true and correct and
incorporated herein as if fully set forth and further agree as follows:

                                    AGREEMENT

                         ARTICLE I - THE ADVALIANT STOCK

Section 1.01 Transfer of AdValiant Class A

      Subject to the delivery and  settlement of the Notes and the  cancellation
of the Exchangeable Shares,  AdValiant USA hereby transfers all of the AdValiant
Class A shares owned by it to the Shareholders.

Section 1.02 Cancellation of the AdValiant Exchangeable Shares

      The  AdValiant  Exchangeable  shares shall be cancelled  and the AdValiant
corporate  documents  amended to reflect  their  return  and  cancellation.  The
Shareholders  acknowledge that, upon cancellation of the Voting Trust Agreement,
they no longer retain the right to exchange their AdValiant  Exchangeable shares
for DGI Common  Stock.  AdValiant  agrees to cancel the  Exchangeable  Shares as
promptly as possible.

<PAGE>

Section 1.03 Transfer of the DGI Preferred Voting Shares

      The Shareholders hereby transfer all of the DGI Preferred Voting Shares to
DGI for  cancellation.  The Shareholders  acknowledge that they no longer retain
the right to vote their DGI Preferred  Voting  Shares.  DGI agrees to cancel the
DGI Preferred Voting Shares as promptly as possible.

Section 1.04 Directions to the Trustee and the Escrow Agent

      DGI, the Shareholders, and AdValiant hereby jointly direct the Trustee and
the Escrow Agent to return the DGI Preferred  Voting Shares to DGI and to return
the  Exchangeable  Shares to  AdValiant  after  receiving  certification  of the
cancellation  of the  Exchangeable  Shares  from the  Ontario  authorities.  The
Trustee and the Escrow Agent agree to so do.

                           ARTICLE II - THE AGREEMENTS

Section 2.01 Cancellation

      Notwithstanding  any provisions therein,  the Voting Trust Agreement,  the
Support  Agreement,  and the Escrow  Agreement  are hereby  cancelled  and shall
hereafter  be void  and of no  further  effect.  The  Shareholders  specifically
relinquish  their rights to exchange  their  AdValiant  Exchangeable  shares for
shares of DGI Common Stock.

                           ARTICLE III - CONSIDERATION

Section 3.01 Amount and Payment Terms

      As additional  consideration  for the AdValiant Class A, the  Shareholders
agree to repay $185,000 of funds advanced by Commodore  Factors to AdValiant and
$57,000 of expenses incurred by DGI in the transaction. Payment is to be made as
follows:

      (a)   With respect to the funds advanced:

      (i)   $5,000 plus $1,850 of interest on the date hereof;

      (ii)  On the tenth of each month  commencing  February 2006 and continuing
            through and including  January 2009, $5,000 plus 30 days interest as
            calculated  in  accordance  with  the  Advance  Note on the  balance
            outstanding after the last principal payment was made.

      (b)   With respect to the expenses incurred:

      (i)   $1,545 on the date hereof;

      (i)   On the tenth of each month  commencing  February 2006 and continuing
            through and including  December 2008,  $1,545 and a final payment of
            $1,380 on January 10, 2009.

Section 3.02 The Advance Note and the Expense Note

      The  obligation  to repay the balance of the advance shall be evidenced by
the  Shareholders'  joint note (the  "Advance  Note") in the amount of  $180,000
executed  concurrently  herewith.  The  obligation  to repay the  balance of the
expenses shall be evidenced by Shareholders'  joint note (the "Expense Note") in
the amount of $55,460 executed concurrently herewith.

<PAGE>

Section 3.03 Receivables Pledged and Accounts Payable

      (a)   A complete  list of all  AdValiant or AdValiant  USA invoices  which
have been  pledged to  Commodore  Factors as of the date  hereof is  attached as
Schedule 3.03(a).

      (b)   A complete list of all AdValiant and AdValiant USA accounts  payable
known to DGI which were  incurred  between  July 1, 2005 and the date  hereof is
attached as Schedule 3.03(b).

      (c)   DGI  represents  and  warrants  that the above  schedules  are true,
complete, and accurate to the best of its knowledge after reasonable inquiry.

      (d)   AdValiant  shall pay all the AdValiant  invoices  listed in Schedule
3.03(b) in  accordance  with their terms.  AdValiant  and the  Shareholders,  in
accordance with Section 3.03(e), shall jointly hold AdValiant USA and its parent
and their officers, directors,  employees, and agents harmless from and against,
and  reimburse  AdValiant  USA  with  respect  to,  any  and all  loss,  damage,
liability,  cost and expense,  including  reasonable  attorneys' fees and costs,
incurred by it by reason of, or arising out of defending against,  settling,  or
paying any invoice listed in Schedule 3.03(b).

      (e)   If a claim  for which  indemnification  may be  sought  pursuant  to
Section  3.03 (d)  against the other party is  asserted,  the party  entitled to
indemnification  hereunder  shall (i)  promptly  give  notice to the other party
stating the nature and basis of the claim, including a description in reasonable
detail of facts giving rise to the claim and (if known) the amount of the claim,
(ii) give reasonable access to all books, records and documents relevant to that
claim and (iii) shall thereafter  permit the other to participate at the other's
sole expense in the  negotiation  and settlement of that claim and to join in or
assume the defense of any legal action arising there from with counsel  selected
by the other and reasonably  satisfactory to the indemnified party. Either party
may  implead  the other in any  action  that is subject  to the  indemnities  in
Sections 3.03(c) and (d)

      (f)   Notwithstanding  the  foregoing,  all  liability  under this section
shall end on December 31, 2006. No claim for  indemnification or offset shall be
permitted  with  respect  to any  claim  made by a third  party  against  either
AdValiant or AdValiant USA after that date.

                       ARTICLE IV - CONTINUING ACTIVITIES

Section 4.01 Factoring

      After the date hereof, no additional  AdValiant accounts  receivable shall
be pledged to Commodore  Factors.  All receivables  outstanding shall be paid to
DGI for transfer to Commodore  Factors in the normal  course of business.  After
the  presently  pledged  receivables  are paid in full,  DGI  shall use its best
efforts  to obtain the  release  of Peter  Bordes  from his  guarantee  of DGI's
obligations to Commodore Factors. Upon the execution hereof, DGI shall provide a
list of the then pledged  receivables not included in Schedule 3.03(a).  For the
purpose of this  section,  amounts  due from Noave  shall not be included in the
pledged receivables, but shall be treated in accordance with Section 4.03.

<PAGE>

Section 4.02 AdVario and Adialogin

      The parties  agree that AdVario is owned by AdValiant and the Adialogin is
owned by DGI.

Section 4.03 Noave, 4MyChild, and HealthExpo

      All invoices due from Noave,  4MyChild,  and  HealthExpo  shall be paid to
DGI. DGI agrees that one half of any funds from Noave,  4MyChild, and HealthExpo
received after the date hereof shall be applied to the  prepayment  first of the
Expense Note and then of the Advance Note.

Section 4.04 Further Actions

      (a)   The  Parties  agree,  in  order to  perfect  the  return  of the DGI
Preferred  Voting  Shares and the  cancellation  of the  AdValiant  Exchangeable
Shares and to otherwise accomplish the purpose of this Agreement, to execute all
documents and take all other action as any Party may reasonably request, whether
at or after the execution  hereof,  as may be reasonably  necessary or proper to
allow the Parties to receive the full benefits of this Agreement.

      (b)   The  Parties  further  agree to make  any  changes  to any  document
executed in connection  with this  Agreement and the merger  reversed  hereby to
correct or remedy  any  deficiencies  with  respect  to  corporate  law or other
issues.

      (c)   The Parties  shall  exchange  General  Releases  excepting  only the
Notes.

      (d)   Promptly after the DGI Voting  Preferred  Shares are cancelled,  DGI
shall close the AdValiant  bank account in Toronto  Dominion Bank. At that time,
all unused checks shall be sent to the Shareholders.

      (e)   Promptly  after  the  execution  hereof,  all  AdValiant  accounting
records,  financial  statements,  bank statements,  expense  records,  and other
documents  and reports  relating to  AdValiant's  business  shall be sent to the
Shareholders.

          {The balance of this page has been intentionally left blank}

<PAGE>

      IN ORDER TO INDICATE THEIR INTENTION TO BE BOUND BY THE TERMS HEREOF,  the
Parties  hereto  have either  executed  this  Agreement  or caused it to be duly
executed by their respective duly authorized officers as of the date first above
written.

DGI AND ADVALIANT USA

DIALOG GROUP, INC. AND ADVALIANT USA, INC.
(F/K/A ADVALIANT ACQUISITION, INC.)

By: /s/ Peter V. DeCrescenzo
    -------------------------------------
    Peter V. DeCrescenzo, President

THE SHAREHOLDERS:                                      ADVALIANT

    Empire Media, Inc.                               AdValiant Inc.

By: /s/ Peter Bordes                        By: /s/ Peter Bordes
    ----------------------------------          --------------------------------
    Peter Bordes                                Peter Bordes, President

    /s/ Matt Wise
    ----------------------------------
    Matt Wise

    /s/ Jivan Manhas
    ----------------------------------
    Jivan Manhas

THE TRUSTEE:

    Empire Media, Inc.

By: /s/ Peter Bordes
    ----------------------------------
    Peter Bordes

THE ESCROW AGENT

    /s/ Mark Alan Siegel
    ----------------------------------
    Mark Alan Siegel

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00095-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00095-of-00352.parquet"}]]