UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

 

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
(Amendment No.  )

 

Check the appropriate box:

SERACARE LIFE SCIENCES, INC.

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

Common stock, par value $0.001 per share, of SeraCare Life Sciences, Inc. (the “Common Stock”).

As of February 23, 2012, 20,199,094 shares of Common Stock and 799,874 shares of Common Stock issuable upon the exercise of options with exercise prices less than $4.00.

The maximum aggregate value was determined based upon the sum of: (A) 20,199,094 shares of Common Stock outstanding, multiplied by $4.00 per share and (B) options to purchase 799,874 shares of Common Stock with exercise prices less than $4.00 multiplied by $1.53, which is the difference between $4.00 and the weighted average exercise price of $2.47 per share.

$82,020,183

$9,400, determined based upon multiplying 0.0001146 by the proposed maximum aggregate value of the transaction.

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37 Birch Street
Milford, Massachusetts 01757
Telephone: (508) 244-6400
Fax: (508) 634-3394

        , 2012

MERGER PROPOSED — YOUR VOTE IS IMPORTANT

Dear Stockholder:

You are cordially invited to attend a special meeting of the stockholders of SeraCare Life Sciences, Inc., a Delaware corporation, which will be held on           , 2012, at     a.m., local time, at the offices of Foley Hoag LLP at Seaport West, 155 Seaport Boulevard, Boston, Massachusetts 02210.

At the special meeting, we will ask you to consider and vote on a proposal to adopt a merger agreement that we entered into with Project Plasma Holdings Corporation, whom we refer to as Buyer, and Project Plasma Merger Corp., a wholly owned subsidiary of Buyer whom we refer to as the Merger Subsidiary, on February 12, 2012, as amended by Amendment No. 1 to Agreement and Plan of Merger, dated as of February   , 2012. Buyer and the Merger Subsidiary are affiliates of Linden Capital Partners, or Linden, a Chicago-based private equity firm that focuses on middle-market leveraged buyout investments in the healthcare and life science industries. If stockholders representing at least a majority of the shares of our common stock outstanding on the record date adopt the merger agreement and the merger is completed, we will become a wholly owned subsidiary of Buyer, and you will be entitled to receive $4.00 in cash, without interest and less any applicable withholding taxes, for each share of our common stock that you own.

After careful consideration, our board of directors, by the unanimous vote of all directors, approved the merger agreement and determined that the merger and the merger agreement are advisable and in the best interests of our company and our stockholders. Our board of directors unanimously recommends that you vote “FOR” the adoption of the merger agreement.

Your vote is very important. Adoption of the merger agreement requires the affirmative vote of the holders of a majority of the shares of our common stock outstanding on the record date. Therefore, failure to vote will have the same effect as a vote against the adoption of the merger agreement.

In addition, the Securities and Exchange Commission has adopted rules that require us to seek a non-binding, advisory vote with respect to certain compensation arrangements for our named executive officers in connection with the merger. Our board of directors unanimously recommends that you vote “FOR” the merger-related compensation proposal described in the accompanying proxy statement.

The accompanying proxy statement provides a detailed description of the proposed merger, the merger agreement and related matters, and a copy of the merger agreement is included as Annexes A-1 and A-2 to the proxy statement. We urge you to read all of these materials carefully.

Whether or not you are able to attend the special meeting in person, please submit your proxy via the Internet (          ), by telephone (          ), or complete, sign and date the enclosed proxy card and return it in the provided envelope as soon as possible. If you have Internet access, we encourage you to record your vote via the Internet. This action will not limit your right to vote in person at the special meeting.

If you have any questions or need assistance voting your shares, please call our proxy solicitor,       , at (      )           -          .

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Thank you for your cooperation and your continued support of SeraCare Life Sciences, Inc.

Very truly yours,

Gregory A. Gould

Interim President and Chief Executive Officer
and Chief Financial Officer

This proxy statement is dated           , 2012 and is first being mailed to stockholders on or about           , 2012.

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED THE MERGER, PASSED UPON THE MERITS OR FAIRNESS OF THE MERGER AGREEMENT OR THE TRANSACTIONS CONTEMPLATED THEREBY, INCLUDING THE PROPOSED MERGER, OR PASSED UPON THE ADEQUACY OR ACCURACY OF THE INFORMATION CONTAINED IN THIS DOCUMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

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37 Birch Street
Milford, Massachusetts 01757
Telephone: (508) 244-6400
Fax: (508) 634-3394

 

NOTICE OF SPECIAL MEETING OF STOCKHOLDERS

To Be Held On       , 2012

To the Stockholders of SeraCare Life Sciences, Inc.:

We will hold a special meeting of the stockholders of SeraCare Life Sciences, Inc. at the offices of Foley Hoag LLP, Seaport West, 155 Seaport Boulevard, Boston, Massachusetts 02210, on          , 2012, at     a.m., local time, to consider and act upon the following matters:

A copy of the merger agreement is attached as Annexes A-1 and A-2 to the accompanying proxy statement.

Only holders of record of our common stock as of the close of business on          , 2012 are entitled to receive notice of, and to vote at, the special meeting and any adjournment or postponement of the special meeting. Adoption of the merger agreement requires the affirmative vote of the holders of a majority of the shares of our common stock outstanding on the record date, and the approval of each of the golden parachute proposal and the adjournment proposal requires the affirmative vote of the holders of a majority of the votes present in person or by proxy and entitled to vote at the special meeting. The list of stockholders entitled to vote at the special meeting will be available for inspection at our principal executive offices at 37 Birch Street, Milford, Massachusetts 01757 during ordinary business hours at least 10 days before the special meeting.

Whether or not you are able to attend the special meeting in person, please submit your proxy via the Internet (          ) or by telephone (          ), or complete, sign and date the enclosed proxy card and return it in the envelope provided as soon as possible. If you have Internet access, we encourage you to record your vote via the Internet. This action will not limit your right to vote in person at the special meeting. If you fail to vote by proxy or in person, it will have the same effect as a vote against the adoption of the merger agreement. If you return a properly signed proxy card but do not indicate how you want to vote, your proxy will be counted as a vote “FOR” adoption of the merger agreement, “FOR” approval of the golden parachute proposal and “FOR” the adjournment proposal.

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Our board of directors unanimously recommends that you vote “FOR” approval of the proposal to adopt the merger agreement, “FOR” approval of the golden parachute proposal and “FOR” approval of the adjournment proposal.

If the merger becomes effective, our stockholders who do not vote in favor of the adoption of the merger agreement will have the right to seek appraisal of the fair value of their shares of our common stock, as determined by the Delaware Court of Chancery under applicable provisions of Delaware law, subject to the satisfaction of the requirements for exercising and perfecting such rights. A copy of the full text of the applicable Delaware statutory provisions is included as Annex C to the accompanying proxy statement, and a summary of these provisions can be found under the section entitled “Appraisal Rights” beginning on page 86 in the accompanying proxy statement.

Only stockholders of record or their duly authorized proxies have the right to attend the special meeting. To gain admittance, you must present valid photo identification, such as a driver’s license or passport. If your shares of common stock are held through a bank, brokerage firm or other nominee, please bring to the special meeting a copy of your brokerage statement evidencing your beneficial ownership of the common stock and valid photo identification.

		By Order of the Board of Directors,
		Gregory A. Gould Secretary

Milford, Massachusetts
         , 2012

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SUMMARY TERM SHEET			1
Parties to the Merger			1
The Merger			2
The Special Meeting			2
Record Date; Stock Entitled to Vote			2
Vote Required for Approval			2
Our Board’s Recommendation			3
Opinion of SeraCare’s Financial Advisor			3
Conditions to the Merger			3
No Solicitation			5
Termination of the Merger Agreement			5
Termination Fees			7
Expenses			7
Appraisal Rights			8
Material United States Federal Income Tax Consequences			8
Treatment of Options and Restricted Stock Awards; Stock Plans			8
Interests of Our Directors and Executive Officers in the Merger			8
Common Stock Ownership of Our Directors and Executive Officers			9
QUESTIONS AND ANSWERS ABOUT THE SPECIAL MEETING AND THE MERGER			10
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS			14
THE SPECIAL MEETING OF STOCKHOLDERS			15
Date, Time and Place of the Special Meeting			15
Purpose of the Special Meeting			15
Our Board’s Recommendation			15
Record Date; Stock Entitled to Vote			15
Quorum			15
Vote Required for Approval			16
Voting			16
Revocability of Proxies			16
Solicitation of Proxies			17
Proposal to Approve Adjournment of the Special Meeting			17
Questions and Additional Information			17
Availability of Documents			17
THE MERGER			18
Parties to the Merger			18
Background of the Merger			19
Reasons for the Merger and Recommendation of our Board of Directors			35
Opinion of SeraCare’s Financial Advisor			41

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Certain Prospective Financial Information			45
Financing of the Merger			51
Delisting and Deregistration of SeraCare Common Stock			52
Interests of Our Directors and Executive Officers in the Merger			52
REGULATORY MATTERS			58
LITIGATION RELATED TO THE MERGER			58
MATERIAL UNITED STATES FEDERAL INCOME TAX CONSEQUENCES			59
THE MERGER AGREEMENT			62
Explanatory Note Regarding the Merger Agreement			62
The Merger			62
The Merger Consideration			63
Payment Procedures			63
Treatment of Options and Restricted Stock Awards			64
Representations and Warranties			65
Conduct of Our Business Pending the Merger			68
Preparation of Proxy Statement; Stockholders Meeting			71
Employee Benefit Matters			71
Antitrust Filings			72
Public Statements			72
Standard of Efforts; Required Approvals			72
Notification of Certain Matters			74
Access to Information; Confidentiality			74
No Solicitation			75
Indemnification and Insurance			78
Section 16 Matters			78
Financing			78
Financing Cooperation			80
Tax Withholding on Restricted Stock			80
Conditions to the Merger			80
Termination of the Merger Agreement			82
Termination Fees			83
Expenses			84
Remedies			84
Governing Law			85
Equity Commitment Letter			85
Sponsor Guarantee			85
Amendment			85
APPRAISAL RIGHTS			86
MARKET PRICE INFORMATION			89
SECURITY OWNERSHIP OF MANAGEMENT AND CERTAIN BENEFICIAL OWNERS			90

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COMPENSATION ARRANGEMENTS FOR OUR NAMED EXECUTIVE OFFICERS IN CONNECTION WITH THE MERGER			92
ADJOURNMENT OF THE SPECIAL MEETING			93
FUTURE STOCKHOLDER PROPOSALS			94
WHERE YOU CAN FIND MORE INFORMATION			94
AGREEMENT AND PLAN OF MERGER			ANNEX A-1-1
AMENDMENT NO. 1 TO AGREEMENT AND PLAN OF MERGER			ANNEX A-2-1
OPINION OF LAZARD FRÈRES & CO. LLC			ANNEX B-1
SECTION 262 OF THE DELAWARE GENERAL CORPORATION LAW			ANNEX C-1

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SUMMARY TERM SHEET

This summary highlights selected information from this proxy statement and may not contain all of the information that is important to you. Accordingly, we urge you to read carefully this entire proxy statement and the annexes to this proxy statement. We have included page references parenthetically to direct you to a more complete description of the topics in this summary.

In this proxy statement, the terms “we,” “us,” “our,” “our company” and “SeraCare” refer to SeraCare Life Sciences, Inc., the term “Buyer” refers to Project Plasma Holdings Corporation, the term “Merger Subsidiary” refers to Project Plasma Merger Corp., a wholly owned subsidiary of Buyer, the term “Linden” refers to Linden Capital Partners, an affiliate of Buyer and the Merger Subsidiary, and the term “merger agreement” refers to the Agreement and Plan of Merger, dated as of February 12, 2012, as amended by Amendment No. 1 to Agreement and Plan of Merger, dated as of February     , 2012, by and among SeraCare, Buyer and the Merger Subsidiary, as it may be amended from time to time.

Parties to the Merger

SeraCare Life Sciences, Inc.
37 Birch Street
Milford, Massachusetts 01757
Telephone: (508) 244-6400

SeraCare serves the global life sciences industry by providing vital products and services to facilitate the discovery, development and production of human diagnostics and therapeutics. SeraCare’s innovative portfolio includes diagnostic controls, plasma-derived reagents and molecular biomarkers, biobanking and contract research services. SeraCare’s quality systems, scientific expertise and state-of-the-art facilities support its customers in meeting the stringent requirements of the highly regulated life sciences industry.

Linden Capital Partners
c/o Linden LLC
111 S. Wacker Drive, Suite 3350
Chicago, Illinois 60606
Telephone: (312) 506-5600

Linden is a Chicago-based private equity firm focused on leveraged buyouts in the healthcare and life science industries. Linden’s investment strategy is based upon three elements: healthcare and life science industry specialization, integrated private equity and operating expertise, and strategic relationships with large corporations.

Project Plasma Holdings Corporation
c/o Linden LLC
111 S. Wacker Drive, Suite 3350
Chicago, Illinois 60606
Telephone: (312) 506-5600

Buyer is an affiliate of Linden and was formed solely for the purpose of acquiring and holding us. Buyer has not carried on any activities to date, except for activities incidental to its formation and activities undertaken in connection with the transactions contemplated by the merger agreement. Upon consummation of the proposed merger, we will become a wholly owned subsidiary of Buyer.

Project Plasma Merger Corp.
c/o Linden LLC
111 S. Wacker Drive, Suite 3350
Chicago, Illinois 60606
Telephone: (312) 506-5600

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The Merger Subsidiary is a direct, wholly owned subsidiary of Buyer and was formed solely for the purpose of facilitating Buyer’s acquisition of us. The Merger Subsidiary has not carried on any activities to date, except for activities incidental to its formation and activities undertaken in connection with the transactions contemplated by the merger agreement. Upon consummation of the proposed merger, the Merger Subsidiary will merge with and into us and will cease to exist.

The Merger (page 18 )

Upon the terms and subject to the conditions of the merger agreement, the Merger Subsidiary will be merged with and into us, and each holder of shares of our common stock will be entitled to receive $4.00 in cash, without interest and less any applicable withholding taxes, for each share of common stock held by such holder immediately prior to the merger (unless such holder has not voted in favor of the merger agreement and has properly exercised his or her statutory appraisal rights with respect to the merger). Following the merger, we will cease to be a publicly traded company and will instead become a wholly owned subsidiary of Buyer. You will not own any shares of the surviving corporation of the merger. The merger agreement is attached as Annexes A-1 and A-2 to this proxy statement. Please read it carefully.

The Special Meeting of Stockholders (page 15 )

The special meeting will be held on         , 2012 at     a.m., local time, at the offices of Foley Hoag LLP at Seaport West, 155 Seaport Boulevard, Boston, Massachusetts 02210. At the special meeting, you will be asked to vote upon a proposal to adopt the merger agreement that we have entered into with Buyer and the Merger Subsidiary, which we refer to as the merger proposal. You will also be asked to vote upon a non-binding proposal to approve the compensation that may become payable to certain of our named executive officers in connection with the completion of the merger, which we refer to as the golden parachute proposal, and a proposal to adjourn or postpone the special meeting, if necessary, to solicit additional proxies in favor of adoption of the merger agreement, which we refer to as the adjournment proposal. You may also be asked to vote upon such other matters as may properly come before the special meeting or any adjournment or postponement thereof.

Record Date; Stock Entitled to Vote (page 15 )

Our board of directors has fixed the close of business on         , 2012, as the record date for determining stockholders entitled to receive notice of and to vote at the special meeting. On the record date, we had          outstanding shares of common stock held by approximately          stockholders of record. We have no other class of voting securities outstanding.

Stockholders of record on the record date will be entitled to one vote per share of our common stock on any matter that may properly come before the special meeting and any adjournment or postponement of that meeting.

Vote Required for Approval (page 16 )

Pursuant to the requirements of the General Corporation Law of the State of Delaware, or the DGCL, the approval of the merger proposal requires the affirmative vote of the holders of a majority of the shares of our common stock outstanding on the record date. Abstentions and broker non-votes, as described below, will have the same effect as a vote “AGAINST” the approval of the merger proposal.

The affirmative vote of the holders of a majority of the shares of our common stock present in person or by proxy and entitled to vote at the special meeting will be required to approve each of the golden parachute proposal and the adjournment proposal. Abstentions will have the same effect as a vote “AGAINST” the approval of these proposals. Broker non-votes will have no effect on the approval of these proposals.

Brokers or other nominees who hold shares of our common stock in “street name” for customers who are the beneficial owners of such shares may not, in the absence of specific instructions from those customers, give a proxy to vote their customers’ shares with respect to the approval of the merger proposal, the golden parachute proposal or the adjournment proposal. Shares held by brokers or other nominees that are not voted for lack of instructions from their customers are referred to as “broker non-votes.” Broker non-votes will not be counted as votes cast or shares voting and will have the same effect as votes “AGAINST” the merger proposal. Assuming a quorum is present at the special meeting, broker non-votes will have no effect on the approval of the golden parachute proposal or the adjournment proposal.

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Our Board’s Recommendation (page 15 )

Our board of directors has unanimously (i) determined that the merger and the merger agreement are advisable and in the best interests of our company and our stockholders, (ii) approved the merger agreement, (iii) resolved to recommend that stockholders vote in favor of the adoption of the merger agreement, and (iv) directed that such matter be submitted for the consideration of our stockholders at the special meeting. Accordingly, our board of directors unanimously recommends that our stockholders vote “FOR” the merger proposal, “FOR” the golden parachute proposal and “FOR” the adjournment proposal.

For the factors considered by our board of directors in reaching its decision to approve the merger agreement, see “The Merger — Reasons for the Merger and Recommendation of our Board of Directors” beginning on page 35 of this proxy statement.

Opinion of SeraCare’s Financial Advisor (page 41 and Annex B)

In connection with the merger, our financial advisor, Lazard Frères & Co. LLC, or Lazard, rendered to our board of directors its oral opinion, subsequently confirmed in writing, that as of February 12, 2012, and based upon and subject to the various assumptions, procedures, factors, qualifications and limitations set forth in the written opinion, the consideration to be received by holders of shares of our common stock pursuant to the merger agreement was fair, from a financial point of view, to such holders. The full text of the written opinion of Lazard, dated as of February 12, 2012, is attached as Annex B to this proxy statement and is incorporated by reference into this proxy statement in its entirety. The opinion sets forth, among other things, the assumptions made, procedures followed, matters considered and limitations on the scope of the review undertaken by Lazard in rendering its opinion. The summary of the opinion of Lazard in this proxy statement is qualified in its entirety by reference to the full text of the opinion. Lazard’s opinion is directed to our board of directors and addresses only the fairness, from a financial point of view, of the consideration to be received by holders of shares of our common stock pursuant to the merger agreement as of the date of the opinion. Lazard’s opinion does not address any other aspects of the merger and does not constitute a recommendation to any holder of our common stock as to how to vote at any stockholders’ meeting held in connection with the merger or whether to take any other action with respect to the merger.

Conditions to the Merger (page 80 )

Conditions to Each Party’s Obligations.   The respective obligations of each party to effect the merger are subject to the satisfaction or, to the extent permitted by law, waiver of each of the following conditions:

Conditions to Buyer’s and the Merger Subsidiary’s Obligations.   The obligations of Buyer and the Merger Subsidiary to consummate the merger are subject to the satisfaction or, to the extent permitted by law, waiver of further conditions, including:

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Conditions to SeraCare’s Obligations.   Our obligation to consummate the merger is subject to the satisfaction or waiver of further conditions, including:

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No Solicitation (page 75 )

Immediately upon signing of the merger agreement, we agreed not to, and agreed not to authorize or permit any of our officers, directors or employees, or authorize any of our financial advisors, attorneys or other advisors or representatives to (i) solicit, initiate, or knowingly encourage or induce the submission or announcement of any takeover proposal, (ii) publicly approve, endorse or recommend to our stockholders any takeover proposal, or enter into any agreement or instrument with respect to any takeover proposal or any agreement or instrument that by its express written terms requires us to terminate the merger agreement, (iii) participate or engage in any discussions or negotiations with any person or group other than Buyer or its affiliates regarding any takeover proposal, or furnish any confidential information relating to us, or afford access to our business, properties, assets, books or records, to any third party that to our knowledge is seeking to make or has made any takeover proposal, (iv) grant any waiver, amendment or release under any standstill or confidentiality agreement with a third party whom we have reason to believe is seeking to make or has made any takeover proposal, unless our board of directors determines in good faith that the failure to take such action would reasonably be expected to be inconsistent with its fiduciary duties, or (v) agree to or publicly propose to do any of the foregoing.

Notwithstanding the restrictions described above, at any time before the adoption of the merger agreement by our stockholders, if our board of directors receives an unsolicited written takeover proposal from a third party that did not result from a breach of the provisions of the merger agreement regarding restrictions on solicitations, we are entitled to participate or engage in discussions or negotiations regarding such takeover proposal and may provide or furnish information to the third party making the takeover proposal so long as our board of directors: (i) determines in good faith that the takeover proposal is bona fide, (ii) determines in good faith, after consultation with our financial advisor and outside counsel, that the takeover proposal is, or could reasonably be expected to result in or lead to, a superior proposal, and (iii) determines in good faith, after consultation with our outside counsel, that the failure to take such action would reasonably be expected to be inconsistent with the fiduciary duties of our board of directors. We may furnish information to a third party that has made a takeover proposal only in accordance with a confidentiality agreement that predates the merger agreement or that does not prohibit us from complying with our obligations under the merger agreement, and that generally contains provisions no less favorable to us in the aggregate than the provisions of our confidentiality agreement dated as of August 27, 2011 with Linden Manager LP.

Termination of the Merger Agreement (page 82 )

We, Buyer and the Merger Subsidiary may terminate the merger agreement by mutual written consent at any time before the effective time of the merger. In addition, either Buyer or we may terminate the merger agreement, subject to certain conditions, at any time before the consummation of the merger if:

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Buyer may also terminate the merger agreement at any time before the receipt of the affirmative vote of the holders of a majority of the outstanding shares of our common stock to adopt the merger agreement if:

Buyer may not terminate the merger agreement for the reasons described in the preceding three bullet points if a breach of the merger agreement by Buyer or the Merger Subsidiary would cause any of our closing conditions with respect to the accuracy of the representations and warranties of Buyer and the Merger Subsidiary or their compliance with their obligations under the merger agreement not to be satisfied.

We may also terminate the merger agreement at any time before the receipt of the affirmative vote of the holders of a majority of the outstanding shares of our common stock to adopt the merger agreement if:

We may not terminate the merger agreement based on a Buyer breach termination if a breach of the merger agreement by us would cause any of Buyer’s closing conditions with respect to the accuracy of our representations and warranties or our compliance with our obligations under the merger agreement not to be satisfied.

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Additionally, we may terminate the merger agreement at any time prior to the effective time of the merger if:

Termination Fees (page 83 )

We have agreed to pay Buyer a termination fee of $2.5 million, which we refer to as the termination fee, in the event that:

Buyer has agreed to pay us a termination fee of $5.0 million, which we refer to as the reverse termination fee, in the event that we terminate the merger agreement based on a buyer breach termination or a failure to close termination.

Expenses (page 84 )

We and Buyer are required to pay our own expenses in connection with the merger agreement and consummation of the transactions contemplated thereby, whether or not the merger is consummated, except that Buyer agreed to pay any fees payable under or pursuant to antitrust or competition laws.

We also agreed that, if we terminate the merger agreement based on a stockholder vote termination, or if Buyer terminates the merger agreement based on a company breach termination or a non-solicitation breach termination, and at the time of termination neither Buyer nor the Merger Subsidiary was in breach of any provision of the merger agreement such that our closing conditions would not be satisfied, we will reimburse Buyer for up to $1.0 million of its reasonable and documented out-of-pocket fees and expenses, including legal fees and expenses, incurred in connection with the merger and the merger agreement. If we reimburse such expenses and must later pay the termination fee described above, the termination fee will be reduced by the amount of expenses so reimbursed.

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Appraisal Rights (page 86 )

Under Delaware law, holders of our common stock may have the right to an appraisal of the fair value of their shares of common stock in connection with the merger and to receive that value in lieu of the merger consideration. To exercise appraisal rights, a holder of our common stock must not vote for the proposal to adopt the merger agreement, must deliver to us a written appraisal demand before the stockholder vote on the merger agreement is taken at the special meeting, must not submit a letter of transmittal, and must strictly comply with all of the procedures required by Delaware law.

A copy of the full text of Section 262 of the DGCL is included as Annex C to this proxy statement. Failure to follow the procedures set forth in Section 262 of the DGCL will result in the loss of appraisal rights.

Material United States Federal Income Tax Consequences (page 59 )

If the merger is completed, the exchange of common stock by our stockholders for the cash merger consideration will generally be treated as a taxable transaction for United States federal income tax purposes under the Internal Revenue Code of 1986, as amended. Because of the complexities of the tax laws, we advise you to consult your personal tax advisors concerning the applicable United States federal, state, local, foreign and other tax consequences of the merger to you.

Treatment of Options and Restricted Stock Awards; Stock Plans (page 64 )

Options and Restricted Stock Awards.   We have issued options to purchase shares of our common stock under our Amended and Restated 2001 Stock Incentive Plan and our 2009 Equity Incentive Plan (which, together, we refer to as the stock plans). Each stock option which has not been exercised and has not expired or terminated and remains outstanding immediately prior to the effective time of the merger will be canceled, and the holder of any such option will be entitled to receive an amount in cash, without interest, equal to the product of (i) the total number of shares of our common stock issuable upon exercise of the stock option and (ii) the merger consideration less the exercise price per share of the stock option and less applicable withholding taxes. Any stock option with an exercise price equal to or greater than $4.00 per share will be canceled without any payment.

As of the effective time of the merger, each share of common stock issued pursuant to a stock plan that is subject to a risk of forfeiture or a right of repurchase until vested by continued employment or other service to us (which we refer to as restricted stock) that is outstanding and unvested immediately prior to the effective time of the merger will become fully vested and the holder of any such restricted stock will be entitled to receive the merger consideration less applicable withholding taxes.

Stock Plans.   As of the consummation of the merger, we will terminate the stock plans and the provisions in any other plan, program or arrangement providing for the issuance or grant of any other interest in respect of our capital stock.

Interests of Our Directors and Executive Officers in the Merger (page 52 )

In considering the recommendation of our board of directors with respect to the merger agreement, holders of shares of our common stock should be aware that our directors and executive officers have interests in the merger that may be different from, or in addition to, those of our stockholders generally. These interests may create potential conflicts of interest. Our board of directors was aware that these interests existed when it approved the merger agreement. These interests include:

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These arrangements are further described under “The Merger — Interests of Our Directors and Executive Officers in the Merger” beginning on page 52 of this proxy statement.

Common Stock Ownership of Our Directors and Executive Officers (page 90 )

As of February 23, 2012, our current directors and executive officers beneficially owned in the aggregate 1,332,939 shares of our common stock or approximately 6.6% of our total outstanding shares. The share ownership of our directors and executive officers is further described under “Security Ownership of Management and Certain Beneficial Owners” beginning on page 90 of this proxy statement.

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QUESTIONS AND ANSWERS ABOUT THE SPECIAL MEETING AND THE MERGER

The following questions and answers briefly address some commonly asked questions about the special meeting of stockholders and the merger. These questions and answers may not address all questions that may be important to you as a stockholder. You should carefully read this entire proxy statement, including each of the annexes.

After the merger closes, Buyer will arrange for a letter of transmittal to be sent to each of our stockholders for use in surrendering stock certificates or transferring uncertificated shares in exchange for the merger consideration. The merger consideration will be paid to a stockholder once that stockholder submits a properly completed letter of transmittal, his, her or its stock certificates and any other required documentation or, in the case of book-entry transfer of uncertificated shares of our common stock, an “agent’s message”.

Whether or not you are able to attend the special meeting in person, please submit your proxy via the Internet (          ) or by telephone (          ), or complete, sign and date the enclosed proxy card and return it in the envelope provided as soon as possible.

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The holders of a majority of the shares of our common stock present in person or represented by proxy and entitled to vote at the special meeting will be required to approve the golden parachute proposal. Abstentions will have the same effect as a vote “AGAINST” the golden parachute proposal. Broker non-votes will have no effect on the approval of the golden parachute proposal.

The holders of a majority of the shares of our common stock present in person or represented by proxy and entitled to vote at the special meeting will be required to approve the adjournment proposal. Abstentions will have the same effect as a vote “AGAINST” the adjournment proposal. Broker non-votes will have no effect on the approval of the adjournment proposal.

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If you return a properly signed proxy card but do not indicate how you want to vote, your proxy will be counted as a vote “FOR” the merger proposal, “FOR” the golden parachute proposal and “FOR” the adjournment proposal.

If you submit your properly signed proxy and affirmatively elect to abstain from voting, your proxy will be counted as present for the purpose of determining the presence of a quorum but will have the same effect as a vote “AGAINST” the merger proposal, “AGAINST” the golden parachute proposal and “AGAINST” the adjournment proposal.

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PLEASE DO NOT SEND YOUR STOCK CERTIFICATES NOW.

If your brokerage firm, bank, trust or other nominee holds your shares in “street name,” you should also call your brokerage firm, bank, trust or other nominee for additional information.

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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

We caution you that this document contains disclosures that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 about us and the merger. All statements regarding our expected future financial position, results of operations, cash flows, dividends, financing plans, business strategy, budget, projected costs or cost savings, capital expenditures, competitive positions, growth opportunities for existing products or products under development, plans and objectives of management for future operations, markets for stock, and our evaluation of strategic alternatives, including the merger, are forward-looking statements. In addition, forward-looking statements include statements in which we use words such as “expect,” “believe,” “anticipate,” “intend,” or similar expressions. These forward-looking statements are based upon information presently available to our management and are inherently subjective, uncertain and subject to change, due to any number of risks and uncertainties. Factors that could cause events not to occur as expressed in the forward-looking statements in this document include, but are not limited to, unanticipated delays; the occurrence of any event, change or other circumstances that could give rise to the termination of the merger agreement; the outcome of the litigation that has been instituted with respect to the merger; and the inability to complete the merger due to the failure to obtain the approval of our stockholders of the adoption of the merger agreement or the failure to satisfy other closing conditions, including the receipt of required regulatory approvals, as well as other risk factors detailed in our Annual Report on Form 10-K filed with the SEC on November 21, 2011, as amended, under the captions “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors” and otherwise in our reports and filings with the Securities and Exchange Commission. Many of these factors are beyond our ability to control or predict. You should not place undue reliance on any forward-looking statements, since those statements speak only as of the date that they are made. We assume no obligation to update, revise or correct any forward-looking statements after the date of this document or after the respective dates on which such statements otherwise are made, whether as a result of new information, future events or otherwise, except as otherwise may be required by law.

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THE SPECIAL MEETING OF STOCKHOLDERS

We are furnishing this proxy statement to you, as a holder of our common stock, as part of the solicitation of proxies by our board of directors for use at the special meeting of stockholders, or at any adjournment or postponement thereof.

Date, Time and Place of the Special Meeting

The special meeting of our stockholders will be held at the offices of Foley Hoag LLP at Seaport West, 155 Seaport Boulevard, Boston, Massachusetts 02210, on          , 2012, at         a.m., local time.

Purpose of the Special Meeting

The purpose of the special meeting is:

Our Board’s Recommendation

Our board of directors, by the unanimous vote of all directors, approved the merger agreement and determined that the merger and the merger agreement are advisable and in the best interests of our company and our stockholders. Accordingly, our board of directors unanimously recommends that you vote “FOR” the merger proposal, “FOR” the golden parachute proposal and “FOR” the adjournment proposal .

Record Date; Stock Entitled to Vote

The holders of record of shares of our common stock as of the close of business on          , 2012, which is the record date for the special meeting, are entitled to receive notice of and to vote at the special meeting. On the record date, there were          shares of our common stock outstanding and entitled to vote held by approximately          stockholders of record. Each share of our common stock entitles the holder to one vote on all matters properly coming before the special meeting or any adjournment or postponement thereof.

Quorum

Our by-laws and Delaware law require the presence, in person, or by duly authorized proxy, of the holders of a majority of the outstanding shares of our common stock entitled to vote at the special meeting to constitute a quorum. Both abstentions and “broker non-votes” (as that term is described under “— Voting” beginning on page 16 of this proxy statement) will be counted as present for purposes of determining the existence of a quorum. If a quorum is not present at the special meeting, the special meeting may be adjourned by either the chairman of the meeting or by the holders of a majority of the shares of our common stock represented at the meeting, but no other business may be conducted. If a quorum is not present, we expect to adjourn the special meeting to solicit additional proxies and intend to vote any proxies we have received at the time of the special meeting in favor of an adjournment.

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Vote Required for Approval

Our charter and by-laws and Delaware law require the affirmative vote of holders of a majority of the shares of our common stock outstanding on the record date to approve the merger proposal. For the merger proposal, you may vote “FOR”, “AGAINST” or “ABSTAIN.” Abstentions and broker non-votes will have the same effect as a vote “AGAINST” the adoption of the merger agreement.

The affirmative vote of the holders of a majority of the shares of our common stock present in person or represented by proxy and entitled to vote at the special meeting will be required to approve the golden parachute proposal and the adjournment proposal. Abstentions will have the same effect as a vote “AGAINST” the golden parachute proposal and the adjournment proposal. Assuming a quorum is present at the special meeting, broker non-votes will have no effect on the approval of the golden parachute proposal or the adjournment proposal.

Voting

If you are a holder of record of shares of our common stock, you may vote your shares by attending the special meeting and voting your shares of common stock in person, or by one of the following three ways, regardless of whether you plan to attend the special meeting:

All shares of our common stock represented by properly executed proxies received in time for the special meeting will be voted at the special meeting in the manner specified by the holder. If a written proxy card is signed by a stockholder and returned without instructions, the shares of common stock represented by the proxy will be voted “FOR” the merger proposal, “FOR” the golden parachute proposal, “FOR” the adjournment proposal and in accordance with the recommendations of our board of directors on any other matters properly brought before the special meeting for a vote.

Stockholders who have questions or requests for assistance in completing and submitting proxy cards should contact our proxy solicitor,           , at (    )     -      .

Stockholders who hold their shares of our common stock in “street name,” meaning in the name of a bank, broker or other person who is the record holder, must either direct the record holder of their shares of our common stock how to vote their shares or obtain a proxy from the record holder to vote their shares at the special meeting. Brokers or other nominees may not, in the absence of specific instructions from their customers, give a proxy to vote their customers’ shares with respect to the merger proposal, the golden parachute proposal or the adjournment proposal. Shares held by brokers or other nominees that are not voted for lack of instructions from their customers are commonly referred to as “broker non-votes.” You should follow the procedures provided by your broker or nominee regarding the voting of your shares. Broker non-votes will not be counted as votes cast or shares voting and will have the same effect as votes “AGAINST” the adoption of the merger agreement. Assuming a quorum is present at the special meeting, broker non-votes will have no effect on the golden parachute proposal or the adjournment proposal.

Revocability of Proxies

You may change your vote at any time before the polls close at the special meeting. You can do this in one of three ways. First, you can send a written, dated notice to our Secretary at SeraCare Life Sciences, Inc., 37 Birch Street, Milford, Massachusetts 01757, stating that you would like to revoke your proxy. Second, you can complete, date and submit a new proxy card with a later date. Third, you can attend the special meeting and vote in person. Your attendance alone will not revoke your proxy. If you have instructed a broker or nominee to vote your shares, you must follow directions received from your broker or nominee to change those instructions. If you have voted your proxy via the Internet or by telephone, you can revoke your proxy by voting again and only your last action via the Internet or by telephone will be counted.

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Solicitation of Proxies

This proxy solicitation is being made and paid for by SeraCare on behalf of our board of directors. In addition, we have retained            to assist in the solicitation for a fee of approximately $          , a nominal fee per stockholder contact, reimbursement of reasonable out-of-pocket expenses and indemnification against certain losses, costs and expenses. In addition to solicitation by mail, our directors, officers and employees may solicit proxies in person or by e-mail, telephone, facsimile or other means of communication. Our directors, officers and employees will not receive any additional compensation for their services, but we will reimburse them for their reasonable out-of-pocket expenses, if any. We will reimburse banks, brokers, nominees, custodians and fiduciaries for their reasonable expenses in forwarding copies of this proxy statement to the beneficial owners of shares of our common stock and in obtaining voting instructions from those owners. We will pay all expenses of filing, printing and mailing this proxy statement.

Proposal to Approve Adjournment of the Special Meeting

We are submitting a proposal for consideration at the special meeting to authorize the named proxies to approve one or more adjournments or postponements of the special meeting if there are not sufficient votes to adopt the merger agreement at the time of the special meeting, which we refer to as the adjournment proposal. Even though a quorum may be present at the special meeting, it is possible that we may not have received sufficient votes to adopt the merger agreement by the time of the special meeting. In that event, we would determine to adjourn or postpone the special meeting in order to solicit additional proxies. The adjournment proposal relates only to an adjournment of the special meeting for purposes of soliciting additional proxies to obtain the requisite stockholder approval to adopt the merger agreement. Any other adjournment of the special meeting (e.g., an adjournment required because of the absence of a quorum) would be voted upon pursuant to the discretionary authority granted by the proxy.

The approval of the adjournment proposal would require the affirmative vote of the holders of a majority of the shares of our common stock present in person or represented by proxy and entitled to vote at the special meeting. Assuming that a quorum is present, broker non-votes would have no effect on the approval of the adjournment proposal.

Our board of directors recommends that you vote “FOR” the adjournment proposal so that proxies may be used for that purpose, should it become necessary. Properly executed proxies will be voted “FOR” the adjournment proposal, unless otherwise noted on the proxies. If the special meeting is adjourned or postponed, we are not required to give notice of the time and place of the adjourned meeting unless our board of directors fixes a new record date for the special meeting.

Questions and Additional Information

If you have more questions about the merger or how to submit your proxy, or if you need additional copies of this proxy statement or the enclosed proxy card or voting instructions, please call our proxy solicitor,           , at (    )     -      .

Availability of Documents

The reports, opinions or appraisals referenced in this proxy statement will be made available for inspection and copying at our principal executive offices during our regular business hours by any interested holder of our common stock. In addition, our list of stockholders entitled to vote at the special meeting will be available for inspection at our principal executive offices at least 10 days before the special meeting.

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THE MERGER

Parties to the Merger

SeraCare Life Sciences, Inc.
37 Birch Street
Milford, Massachusetts 01757
Telephone: (508) 244-6400

SeraCare serves the global life sciences industry by providing vital products and services to facilitate the discovery, development and production of human diagnostics and therapeutics. SeraCare’s innovative portfolio includes diagnostic controls, plasma-derived reagents and molecular biomarkers, biobanking and contract research services. SeraCare’s quality systems, scientific expertise and state-of-the-art facilities support its customers in meeting the stringent requirements of the highly regulated life sciences industry.

Linden Capital Partners
c/o Linden LLC
111 S. Wacker Drive, Suite 3350
Chicago, Illinois 60606
Telephone: (312) 506-5600

Linden is a Chicago-based private equity firm focused on leveraged buyouts in the healthcare and life science industries. Linden’s investment strategy is based upon three elements: healthcare and life science industry specialization, integrated private equity and operating expertise, and strategic relationships with large corporations.

Project Plasma Holdings Corporation
c/o Linden LLC
111 S. Wacker Drive, Suite 3350
Chicago, Illinois 60606
Telephone: (312) 506-5600

Buyer is an affiliate of Linden and was formed solely for the purpose of acquiring and holding us. Buyer has not carried on any activities to date, except for activities incidental to its formation and activities undertaken in connection with the transactions contemplated by the merger agreement. Upon consummation of the proposed merger, we will become a wholly owned subsidiary of Buyer.

Project Plasma Merger Corp.
c/o Linden LLC
111 S. Wacker Drive, Suite 3350
Chicago, Illinois 60606
Telephone: (312) 506-5600

The Merger Subsidiary is a direct, wholly owned subsidiary of Buyer and was formed solely for the purpose of facilitating Buyer’s acquisition of us. The Merger Subsidiary has not carried on any activities to date, except for activities incidental to its formation and activities undertaken in connection with the transactions contemplated by the merger agreement. Upon consummation of the proposed merger, the Merger Subsidiary will merge with and into us and will cease to exist.

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Background of the Merger

Our board of directors and management periodically review and assess our long-term strategy and objectives, as well as developments in the markets in which we operate. Over the past several years, we have considered a diverse range of strategic alternatives with a view to increasing stockholder value, including potential opportunities for business combinations, acquisitions and other strategic alternatives.

On May 14, 2009, our board of directors held a telephonic meeting at which the directors appointed an ad hoc committee to undertake a strategic review of our company, including potential opportunities for the services business, our dependence on government contracts and a review of our product offerings.

On June 17, 2009, the ad hoc committee met with our executive management team and received detailed presentations regarding the principal aspects of our business, our business strategy, our prospects and business opportunities. On June 22, 2009, the ad hoc committee gave a preliminary report to our board of directors and indicated that a further report would be forthcoming.

On July 24, 2009, our board of directors held a telephonic meeting at which the directors resolved that we pursue strategic alternatives and cost reductions as recommended by the ad hoc special committee of our board of directors. Our chairman also requested that the special committee undertake to interview potential financial advisors.

On September 15, 2009, we engaged William Blair & Co., LLC, or William Blair, as our financial advisor, to explore strategic and financial alternatives for us, including a possible sale or merger.

Between November 2009 and January 2010, William Blair contacted 27 financial sponsors and 48 strategic parties to assess their interest in pursuing a potential acquisition of us. Of those contacted, we entered into confidentiality agreements with 30 parties, including Linden, and circulated our confidential information memorandum.

Between January 20 and 21, 2010, we received preliminary indications of interest from five participants, three of which indicated that they were only interested in acquiring our services business. A financial buyer, whom we refer to as Company A, offered the highest purchase price of $4.72 per share.

Between January 2010 and April 2010, we conducted management presentations, hosted facility tours at our Massachusetts and Maryland locations and granted data room access for selected potential suitors.

On March 31, 2010, our board of directors created a special committee of our board directors, which was comprised of independent directors Eugene Davis, Harold S. Blue and Sarah L. Murphy, to manage our sale process and to report back the results of the process to the entire board for its decision on any potential sale.

On April 14, 2010, we received an updated proposal from Company A to acquire us for a purchase price of $4.88 per share and a proposal from another financial buyer, whom we refer to as Company B, for a purchase price of $5.25 per share.

On April 17, 2010, the special committee of our board of directors held a telephonic meeting. Representatives of Ropes & Gray, then our outside counsel, and William Blair attended this meeting. The two proposals from Company A and Company B were discussed. A concern was raised about the requirement in each proposal that the transaction receive unanimous board approval because one or more directors might oppose any possible sale of our company in light of the proposed prices. The directors engaged in a discussion of the relative merits of the two proposals and noted that we were in a good financial position and under no compulsion to sell.

On April 26, 2010, we received revised proposals to acquire us from Company A for a purchase price of $5.25 per share and from Company B for a purchase price of $5.60 per share.

On April 28, 2010, the special committee of our board of directors held a telephonic meeting. Members of management, and representatives of Ropes & Gray and William Blair attended this meeting. The representatives of William Blair reviewed the terms of the two proposals, noting that both bids included a term requiring unanimous board approval. The directors observed that our strong performance in the second quarter of fiscal 2010 might lead to higher bids. Our then-President and Chief Executive Officer,

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Susan L.N. Vogt, then led a discussion of our outlook for the coming year and she concluded that a bid of $5.60 per share appeared to be in the range of a fair valuation of our company.

On May 3, 2010, we received a final proposal from Company B for $5.75 per share and Company A declined to increase its offer.

On May 4, 2010, the special committee of our board of directors held a telephonic meeting to discuss the two outstanding proposals. Representatives of Ropes & Gray and William Blair attended this meeting. Our board concluded that Company A’s proposal of $5.25 per share was inadequate, but determined that Company B’s proposal of $5.75 per share represented a fair price and that it would be productive to negotiate further terms to make progress toward more transaction certainty. However, the directors noted that certain terms were unacceptable and they were not inclined to grant exclusivity at that time.

On May 10, 2010, our board of directors held a telephonic meeting. Members of management and representatives of Ropes & Gray and William Blair attended this meeting. The directors discussed the merits of Company B’s proposal and of granting Company B a short period of exclusivity in order to line up bank financing, complete diligence and negotiate a definitive agreement. They also discussed the possibility of our remaining a stand-alone company and our ability to grow and increase value for our stockholders. After further discussion, the directors expressed their support for a transaction with Company B if the $5.75 price was firm and certain adjustments were made to the terms of the transaction. They then approved the proposal to grant Company B a period of exclusivity not to exceed 30 days, subject to mutual extension, as long as Company B agreed to our proposed adjustments to the terms of the transaction.

On May 21, 2010, we signed a letter of intent with Company B in which Company B proposed to purchase all of our outstanding shares of common stock for $5.75 per share and was granted 30 days of exclusivity to complete due diligence.

On May 27, 2010, our board of directors held a telephonic meeting. A representative of Ropes & Gray attended this meeting. At the meeting, in response to a question from the directors, Ms. Vogt stated that she believed the fundamentals of our business remained unchanged from when we commenced the strategic process in 2009, but that operational improvements had started to gain traction, which had improved margins more than expected and increased the likelihood that we could successfully execute on our business plan.

On June 15, 2010, the special committee of our board of directors held a telephonic meeting. Representatives of Ropes & Gray and William Blair attended this meeting. The representatives of William Blair reported on the status of Company B’s diligence and efforts to obtain a financing commitment, noting that both were continuing. Members of the special committee expressed concern about the absence of a firm financing term sheet at that stage. The representative of Ropes & Gray then reported on the negotiations of the merger agreement and indicated that the parties had not made sufficient progress on several issues, as Company B was continuing to raise new substantive issues.

On June 18, 2010, our board of directors held a telephonic meeting. Members of management and a representative of Ropes & Gray attended this meeting. Management and our board discussed our May results and considered how we could increase revenues for the third quarter of fiscal 2010 and whether the May results might lead Company B to reduce its offer price. The representative of Ropes & Gray then provided an update regarding the merger agreement and reported that the remedies section continued to be a central point of negotiation. The directors discussed that Company B’s period of exclusivity was set to expire in two days and agreed, by a vote of five to one, to approve a 15-day extension, provided that Company B continued to pursue its bid at the price and on the other terms specified in the letter of intent.

On June 28, 2010, Company B contacted William Blair to raise a number of issues identified during the course of its due diligence and to inform William Blair that it was reducing its offer by $1.25 per share to $4.50 per share.

On June 29, 2010, our board of directors held a telephonic meeting at which the revised proposal from Company B was discussed. Representatives of Ropes & Gray and William Blair attended this meeting. After discussion, our board of directors determined that we should end negotiations with Company B in order to allow us to focus on our business and to avoid distractions to management. The representatives of William

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Blair then provided an update on discussions with another potential buyer indicating that it had conducted some diligence but was not prepared to submit a bid. Our board concluded that we should pursue further discussions with this potential buyer, but limit its access to certain members of management and set a deadline for the delivery of an indication of interest by the end of the third week of July 2010. Our chairman directed Ms. Vogt to prepare a more detailed business plan in the event the exploration of strategic alternatives were to end. This potential buyer subsequently engaged in only limited contact with us and did not submit a bid.

On August 9, 2010, the special committee of our board of directors held a telephonic meeting. Members of management, Sam Anderson and Jill Tillman, both independent directors, and representatives of William Blair and Ropes & Gray attended this meeting. The representatives of William Blair reported on the continuing interest of certain parties in acquiring only one of our businesses, as well as Company A’s continuing interest in a transaction at a purchase price no higher than $5.25 per share. They also reported on the interest of a private equity firm in partnering to acquire a majority of our shares, noting that the firm had not yet discussed valuation. It was the consensus of the committee that we should remain in touch with William Blair regarding any developments but should focus on our business and strategic plan.

On September 30, 2010, the special committee of our board of directors held a telephonic meeting. Members of management, Mr. Anderson and a representative of Ropes & Gray attended this meeting. Ms. Vogt informed the committee that a meeting with Company A had been scheduled for late October. Ms. Vogt expressed a concern that Company A’s suggested purchase price of $5.25 per share might not be firm since we had previously decided to move forward with Company B. Ms. Vogt then discussed Company C, noting that it had expressed interest only in the products business. One director commented that he did not believe Company A would continue to offer $5.25 per share and expressed concern that continuing to consider whether or not to sell our company would be distracting. Other directors agreed that we should not expend significant effort with respect to Company A, but that we should consider meeting with Company A to assess the certainty of its offer.

In early November 2010, members of our management provided to our board of directors management projections for fiscal 2011 showing projected revenue of $53.5 million, or approximately a 6% improvement over our revenue for fiscal 2010, and projected net income of $8.5 million, or approximately a 27% improvement over our net income for fiscal 2010.

On November 17, 2010, the special committee of our board of directors held a telephonic meeting. Members of management and a representative of Foley Hoag, our outside counsel, attended this meeting. Ms. Vogt reported that she had met with Company A at our Massachusetts facility to discuss due diligence and other matters. She also stated that William Blair was still seeking to determine whether Company A would make a new offer and that there was no timetable for the receipt of a new offer.

On December 1, 2010, we reported our financial results for fiscal 2010. We reported that our revenue had increased 13% to $50.4 million over our fiscal 2009 revenue and that our net income had increased to $6.7 million for fiscal 2010 from a net loss of $15.4 million for fiscal 2009, which included impairment charges of $15.7 million.

On December 17, 2010, we received a revised proposal from Company A for a purchase price of $4.85 per share.

On December 22, 2010, our board of directors held a telephonic meeting. Members of management and representatives of Foley Hoag and William Blair attended this meeting. A representative of William Blair described the status of recent negotiations with Company A and stated that he had informed Company A that we were not engaged in an active process. The directors discussed the possibility of a transaction with Company A and the range of prices that might be acceptable. Our board determined that we should request that Company A submit its highest and best bid for consideration.

On February 11, 2011, we reported our financial results for the first quarter of fiscal 2011, which were substantially below our expectations. We reported revenue of $10.5 million for that quarter, which reflected a 7% decline over our revenue in the first quarter of fiscal 2010, rather than an improvement. We reported that our net income, excluding a one-time benefit, had also declined from the net income that we reported for the first quarter of fiscal 2010.

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On February 17, 2011, the special committee of our board of directors held a telephonic meeting. Ms. Vogt and representatives of Foley Hoag and William Blair attended this meeting. A representative of William Blair reported that he had received a call from Company A on February 11, 2011 reaffirming its interest in pursuing an acquisition of our company for $4.85 per share. The William Blair representatives then reviewed the evolution of Company A’s bid since initial discussions had begun in 2009, as well as the proposals that had been made by Company B. Our committee discussed Company A’s revised proposal, including the terms and the size of the premium relative to recent trading prices, as well as whether its price would decline over the course of negotiations. The directors also considered our plan of operation for fiscal 2011 and beyond, our strong cash position, the absence of debt, the likely impact of the announcement of our anticipated results for the second quarter of fiscal 2011, the amount of cash anticipated to be generated in upcoming quarters, the distraction of management that would result from pursuing the offer and the absence of compelling operational reasons to pursue a transaction. After further discussion, the special committee determined that pursuing a transaction at the offered price was not in the best interests of our stockholders and that the interests of our stockholders would best be served by dedicated management focus on our operational plan.

On May 10, 2011, our stockholders elected Joseph M. Nemmers, Jr. and E. Kevin Hrusovsky as new members of our board of directors and re-elected each of Ms. Vogt, Ms. Murphy and Jill Tillman. Following the election, our board of directors consisted of four independent directors and Ms. Vogt. After our annual meeting of stockholders, our board of directors held an in-person meeting in Boston. Management and a representative of Foley Hoag attended this meeting. Ms. Vogt provided an overview of our recent and expected financial results, including anticipated declines in our services revenue and continued lumpiness in our revenue stream. Our board requested additional detail regarding our strategic business plan at its next meeting. Management also described for the board a potential acquisition opportunity, and the board provided feedback regarding pricing negotiations and related matters.

On May 12, 2011, we reported our financial results for the second quarter of fiscal 2011, which were again substantially below our expectations. We reported revenue of $11.0 million for that quarter, which reflected a 14% decline over our revenue of $12.9 million in the second quarter of fiscal 2010. We also reported that our net income of $1.4 million for the second quarter of fiscal 2011 had declined from our net income of $2.1 million in the second quarter of fiscal 2010.

On May 31, 2011, Ms. Vogt received a voicemail from Martin Shkreli, Chief Investment Officer of MSMB Capital Management, or MSMB Capital, which was followed by a brief e-mail and a short telephone conversation. In these communications, Mr. Shkreli offered, on behalf of MSMB Capital, to purchase all of the outstanding shares of our capital stock at a purchase price of $4.25 per share and requested that we respond to the unsolicited offer by June 23, 2011.

On June 3, 2011, our board of directors held a telephonic meeting at which the offer from MSMB Capital was discussed. Members of management and a representative of Foley Hoag attended this meeting. At the request of the chairman, the representative of Foley Hoag reviewed our directors’ fiduciary obligations with respect to MSMB Capital’s proposal and described certain courses of action open to our board of directors. Our board of directors then discussed our current business strategy and possible acquisition targets that we had been considering, noting that the board had previously scheduled an in-person meeting on June 28, 2011 to undertake a thorough review of our company, our operations and our prospects. In light of the MSMB Capital offer, the directors discussed the prior work of our board of directors with William Blair concerning a possible sale transaction and the indications of interest that had been received in connection with that process. Our board also considered the possibility of engaging an investment banker to assist in a response, but ultimately concluded that hiring an investment banker was premature at that time. Our board of directors determined that Ms. Vogt should ask Mr. Shkreli for further information about MSMB Capital and its offer and that it should proceed with its planned meeting on June 28, 2011.

Between June 3, 2011 and June 22, 2011, we received several follow-up inquiries from MSMB Capital regarding our response to its proposal.

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On June 22, 2011, our board of directors held a telephonic meeting. Members of management and a representative of Foley Hoag attended this meeting. After discussion of a proposed acquisition target, our board briefly discussed the unsolicited offer from MSMB Capital.

On June 23, 2011, MSMB Capital delivered a letter to us proposing again to purchase all of our outstanding shares of common stock for $4.25 per share and clarifying that the proposal was not subject to a financing condition. The proposal stated that it was subject to the performance of cursory due diligence and customary closing conditions, and it was contingent on our entering into a definitive agreement with MSMB Capital prior to July 29, 2011. The letter noted that, in the event that we did not accept the offer, MSMB Capital may make an offer directly to our stockholders. MSMB Capital announced the delivery of the letter to us by press release. We announced receipt of the unsolicited offer on June 23, 2011 and stated that we would review the proposal in due course.

On June 28, 2011, our board of directors held an in-person meeting at our headquarters in Milford, Massachusetts. Representatives of management attended the meeting and provided our directors with a comprehensive overview of our business, including, among other matters, our strategic goals, our strategic business plan to attain those goals, our budget and revenue forecasts, analyses of our markets and our competitive position, an update regarding the effectiveness of our commercial operation, and potential acquisition opportunities. Our board of directors discussed our anticipated results of operations for the three months ending June 30, 2011, which our management expected to represent our third consecutive quarter of year-over-year declines, as well as the likely reaction of analysts and investors. Our board of directors directed management to take steps to improve our future results of operations, including the implementation of our key account sales strategy.

Between June 30, 2011 and July 25, 2011, our independent directors held several meetings to discuss whether Ms. Vogt was the right person to lead the effort to revise our business strategy and whether our board of directors should take further steps to realign the trajectory of our business, including the possible termination of Ms. Vogt’s employment.

Beginning on June 30, 2011 and reconvening on July 1, 2011, our board of directors held a telephonic meeting. A representative of Foley Hoag attended this meeting. Also attending the June 30, 2011 meeting were representatives of William Blair. Although not engaged by us at the time, our board had asked William Blair to attend the meeting to provide guidance regarding the unsolicited offer from MSMB Capital. During the meeting, management reviewed financial projections for the third and fourth quarters of fiscal 2011, and the William Blair representatives presented certain financial analyses with respect to our company. The representatives of William Blair also provided a summary of our strategic process commenced in 2009, an overview of current market conditions for mergers and acquisitions, and the advisability of pursuing a sale process at that time. Our board of directors and the representatives of William Blair discussed the reasonably available alternatives to maximize value for our stockholders, including remaining a stand-alone public company and a potential sale, either as a whole or in one or more divisions. The representatives of William Blair noted that they had limited familiarity with MSMB Capital, but they understood it to be a relatively small fund that likely would be unable to complete a transaction without third-party financing. After the William Blair representatives left the meeting, the directors continued to discuss the challenges facing our business and then directed management to analyze the costs and impact of separating our services business, more clearly articulate our strategic vision for continued stand-alone operation and provide a plan for making demonstrable progress in the upcoming fiscal year.

On July 5, 2011, our board of directors held a telephonic meeting. Members of management and a representative of Foley Hoag attended this meeting. Management provided a detailed review of our projected financial results for the third and fourth quarters of fiscal 2011 and responded to questions from the directors regarding increases in selling, general and administrative expenses, which reflected increases in compensation expense in connection with the expansion of our sales team. Mr. Gould also reviewed our anticipated financial results in comparison to the forecasts made by the principal financial analysts that cover our company. Our board of directors then considered whether we needed to reset expectations for the fourth quarter of fiscal 2011. Our board of directors turned to a review of our services business and the potential for an orderly divestment of that business. The directors considered whether the divestiture of the services business would

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have a positive impact on the valuation of our remaining business and would lead to an improved outcome for stockholders. The directors considered management’s estimates that a divestiture of the services business would require significant expenditures to replace certain personnel and assets used in both the products business and the services business. The directors also considered whether the divestiture would make us more attractive to financial buyers and whether acquisitions could increase our attractiveness by helping to build a critical mass. Our board of directors briefly discussed feedback from stockholders regarding the unsolicited offer from MSMB Capital. On the same day, Mr. Gould had a call with a potential financial buyer, whom we refer to as Company D, who expressed interest in a possible transaction with us.

On July 12, 2011, MSMB Capital delivered a second letter to us restating its proposal to purchase all of our outstanding shares of common stock for $4.25 per share. On the same day, MSMB Capital and certain affiliates filed a Schedule 13D with the SEC disclosing that Martin Shkreli beneficially owned approximately 5.2% of our outstanding common stock and attaching as exhibits to the Schedule 13D both the June 23, 2011 and July 12, 2011 letters.

On July 13, 2011, our board of directors held a telephonic meeting. Members of management and a representative of Foley Hoag attended this meeting. At the meeting, management noted that on the previous day MSMB Capital had filed a Schedule 13D reporting ownership of more than 5% of our common stock. Our board of directors then discussed feedback from stockholders regarding the unsolicited offer from MSMB Capital, noting that several were not convinced that the offer was serious. Our board discussed MSMB Capital, the nature of its proposal and the risks of engaging in discussions with MSMB Capital. Management presented to our board of directors sales projections for both the products and services businesses for the fourth quarter of fiscal 2011, including a review of individual large accounts, the status of sales efforts with specific customers, our strategy to consummate sales with those customers and the risks associated with completing projected sales by the end of the quarter. After discussion of our financial results for the third quarter of fiscal 2011 and expected financial results for the fourth quarter of fiscal 2011, as well as the potential market reaction to the announcement of such results, our board of directors provided guidance to management regarding announcing our financial results and updating our earnings guidance. The directors then turned to an evaluation of the strategic alternatives available to us, including remaining an independent public company, the sale of a division, the commencement of discussions with MSMB Capital, the commencement of a process to sell the entire company and, as a preliminary step, the engagement of a financial advisor. Our board determined that, in light of management’s updated forecasts for upcoming fiscal periods, we should obtain professional advice from a financial advisor regarding our valuation in order to be able better to evaluate the offer from MSMB Capital and to decide whether a sale process would be advisable at the present time. The directors discussed the risks associated with pursuing any strategic alternative prior to disclosure of our third-quarter earnings. Our board considered various candidates to serve as our financial advisor and instructed management to obtain proposals from William Blair, Lazard and one other financial advisor.

On July 16, 2011, our board of directors held a telephonic meeting. A representative of Foley Hoag attended this meeting. Our board considered the proposals from William Blair, Lazard, and one other financial advisor, including each financial advisor’s capabilities, proposed fees and prior experience with us. Our board of directors determined it appropriate to enter into an engagement letter with Lazard, due in part to the favorable terms offered by Lazard and its good understanding of our business. Our board directed management to work with Lazard to negotiate, execute and deliver a definitive engagement letter, indemnity agreement and confidentiality agreement. It was the consensus of our board of directors that we should announce, as soon as possible, the engagement of Lazard and the acceleration of our earnings release to July 26, 2011.

On July 18, 2011, we announced that we had retained Lazard to provide advisory services to our board of directors and that we would release our financial results for the third quarter of fiscal 2011 on July 26, 2011.

On July 25, 2011, our board of directors held a telephonic meeting. A representative of Foley Hoag attended this meeting. At the meeting, our board of directors resolved to terminate the employment of Ms. Vogt without cause and appointed Mr. Gould as our Interim President and Chief Executive Officer.

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Mr. Gould and representatives of Lazard then joined the meeting and provided an overview of the various strategic alternatives that we might pursue, including a rejection of the offer from MSMB Capital, exclusive negotiations with MSMB Capital, a narrow market check with key strategic buyers or a broader auction process involving both strategic and financial buyers. The Lazard representatives also described their preliminary research regarding MSMB Capital, including their belief that MSMB Capital likely had access to funding sources, the substantial uncertainty regarding MSMB Capital’s real intentions, and MSMB Capital’s lack of prior experience in acquiring a public company. Our board then considered feedback from existing investors, noting that certain investors had expressed concern about our lack of response to the offer from MSMB Capital and that another large investor was interested in liquidity.

On July 26, 2011, we announced the termination of Ms. Vogt as our President and Chief Executive Officer and the appointment of Mr. Gould as our Interim President and Chief Executive Officer, as well as our financial results for the third quarter of fiscal 2011. We reported revenue of $11.0 million for that quarter, a 15% decline from our revenue of $13.0 million in the third quarter of fiscal 2010, and net income of $0.5 million, which had declined from net income of $1.3 million in the third quarter of fiscal 2010.

On July 28, 2011, our board of directors held a telephonic meeting to receive a presentation from Lazard regarding its financial analysis and to consider next steps. Mr. Gould and representatives of Foley Hoag and Lazard attended this meeting. The Lazard representatives reviewed the materials they had provided to the directors, including historical trends of our stock price, recent trading activity and an overview of various valuation methods. They then turned to a discussion of parties that might be interested in participating in a sale process, noting they had already received inquiries from two parties, one of which was Linden. Mr. Gould noted that he had also received an inquiry from Company D. Our board discussed these and other potential candidates and reflected upon prior discussions of the challenges of separating the services business. Our board continued to assess the alternatives to a sale process, including continuing as a stand-alone company, augmenting our research and development efforts and pursuing strategic acquisitions, and evaluated the execution risks associated with each of these alternatives. After further discussion about a possible sale process, including the consequences of a failed process, the distractions that would be created by pursuing any sale process, Lazard’s recommendation that we should conduct a comprehensive sale process that included a broad market check involving both financial and strategic buyers and the possibility of using the MSMB Capital offer as leverage to obtain better offers from other potential buyers, the directors tentatively concluded that we should commence a public sale process. Our board also directed Lazard to begin negotiations of a confidentiality agreement with MSMB Capital.

On July 31, 2011, our board of directors held a telephonic meeting to continue to discuss the strategic alternatives available to us. Mr. Gould and representatives of Foley Hoag and Lazard attended this meeting. The Lazard representatives reviewed their supplementary analysis of us, noting that relatively few strategic buyers would regard an acquisition of us as strategically necessary and that we were more likely to receive an attractive valuation from a broad competitive bidding process. They also provided an update from their conversation with MSMB Capital, including that MSMB Capital was eager to proceed and that they had informed MSMB Capital that we were pursuing our own process, which would drive the timing of any negotiations. The directors discussed with the Lazard representatives the timing of any sale process and the information that would be provided to bidders. They also considered the proposed timeline in relation to earnings announcements and other events that could impact valuation. Our board of directors ultimately resolved to explore strategic alternatives and to solicit broadly indications of interest and/or offers from third parties and authorized Mr. Gould and Lazard to negotiate and enter into confidentiality agreements with potential bidders. Because our board of directors was then comprised entirely of independent directors, we did not form a special committee of directors to direct our exploration of strategic alternatives.

On August 1, 2011, we announced that our board of directors had initiated a process to explore and evaluate potential strategic alternatives to enhance stockholder value, including a potential sale of our company.

Beginning August 8, 2011 and continuing through October 2011, Lazard contacted 66 financial sponsors (including Company A, Company B, Company D and Linden) and 29 strategic parties (including Company C) to assess their interest in pursuing a potential acquisition of us. Of those contacted, we entered into

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confidentiality agreements with 33 parties, 32 of which subsequently received our confidential information memorandum. The confidentiality agreements contained customary non-disclosure and standstill provisions. In addition, the confidentiality agreements contained provisions designed to facilitate a competitive bidding environment by prohibiting the potential bidders who would receive our confidential information from sharing confidential information with prospective financing sources or co-bidders or entering into exclusive financing arrangements without our consent.

On August 11, 2011, representatives of Lazard informed Mr. Gould that Linden had expressed an interest in a possible transaction with us.

On August 24, 2011, our board of directors held a telephonic meeting. Mr. Gould and representatives of Foley Hoag and Lazard attended this meeting. The Lazard representatives provided an update on the status of their discussions with both strategic and financial buyers and reviewed the degree of interest displayed by various participants. They reviewed the list of participants that had declined to proceed, noting that explanations for the declines included lack of strategic fit, lack of expertise in our industry and our size. The Lazard representatives also reported that MSMB Capital had reiterated its offer of $4.25 per share and noted that it was looking for significant changes to the standstill provisions of our confidentiality agreement, which would permit it to circumvent the process designed by our board of directors. They reviewed the current timeline for the sale process and stated that the timeline was designed in part to ensure that the larger strategic players would be afforded sufficient time to participate. The discussion then turned to Linden’s engagement of the same team from William Blair that had represented us in our 2009 sale process. It was noted that William Blair was subject to a confidentiality agreement with us and that its familiarity with our business would likely facilitate Linden’s due diligence.

Between August 26, 2011 and November 4, 2011, Lazard sent process letters to 32 participants requesting that each participant submit to Lazard a preliminary non-binding indication of interest for a possible acquisition of us.

On September 16, 2011, Lazard received written preliminary indications of interest from Linden and Company D regarding a possible acquisition of us. In its preliminary indication of interest, Linden indicated that it was interested in pursuing an acquisition of us at a purchase price in the range of $3.75 to $4.10 per share, which Linden expected to fund through a combination of equity and third-party debt financing. In its preliminary indication of interest, Company D indicated that it was interested in pursuing an acquisition of us at a purchase price of $4.30 per share, which Company D expected to fund entirely with equity.

On September 19, 2011, our board of directors held a telephonic meeting to discuss the status of our strategic process. Mr. Gould and representatives of Foley Hoag and Lazard attended this meeting. The Lazard representatives provided an overview of their contacts with various participants and stated that negotiations were ongoing with certain potential bidders regarding the form of the confidentiality agreement and therefore these potential bidders had not yet received the confidential information memorandum. They also noted that we had received two written proposals, from Linden and Company D, and that they expected to receive another proposal shortly. The representatives of Lazard stated that they did not expect to receive additional proposals from participants who had signed a confidentiality agreement and then turned to a discussion of potential strategic buyers, noting that at least one of the participants had expressed interest in only our biorepository business. The Lazard representatives reported that they had not heard from MSMB Capital in three weeks and reminded the directors that we had not yet reached agreement on a confidentiality agreement with MSMB Capital because of its position regarding the standstill provision in the agreement. They also shared their experiences that, in negotiating with financial buyers, preliminary purchase prices could decrease. Our board considered further the possibility of segregating and selling our biorepository business or services business and discussed the feasibility of a two-buyer transaction. Our board of directors also discussed whether a stock repurchase program might be an attractive means to return value to our stockholders.

On September 20, 2011, Lazard received a written preliminary indication of interest from another financial buyer, whom we refer to as Company E. In its preliminary indication of interest, Company E indicated that it was interested in pursuing an acquisition of us at a purchase price in the range of $3.95 to

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$4.27 per share. Company E stated that it had a current portfolio company which, if combined with our company, it believed would notably enhance the current portfolio company’s presence in the life sciences market.

On September 27, 2011, Lazard sent second-round process letters and provided data room access to Linden, Company D and Company E.

Between September 2011 and November 20, 2011, management and representatives of Lazard engaged with a number of parties, including Linden, Company D and Company E, in confidential management meetings, site visits and diligence calls. During this time, Company C executed a new confidentiality agreement with us and indicated that it was interested only in our products business.

On October 5, 2011, our board of directors held a telephonic meeting to discuss the status of our strategic process. Members of management and representatives of Foley Hoag and Lazard attended this meeting. The Lazard representatives provided an update on the process, noting that various participants had been scheduling meetings with management, visiting our facilities and arranging for due diligence. They also described the varying degrees of interest shown by a few strategic parties, including that certain strategic buyers were interested in only one of our business divisions. The Lazard representatives and the directors discussed the preliminary bids that had been received and considered the merits of extending deadlines to potentially increase competitive pressure. The directors then turned to a discussion of MSMB Capital’s request for a provision in its confidentiality agreement that would cause the standstill period to expire if we did not announce a definitive acquisition agreement by December 20, 2011, and they engaged in a discussion with the Lazard representatives about the benefits of including MSMB Capital in the process and what a reasonable standstill period for MSMB Capital would be. Our board of directors concluded that it would be beneficial to include MSMB Capital in the current process and directed Lazard to reject MSMB Capital’s proposed deadline of December 20, 2011 for the standstill and to counter-offer a standstill period of nine months. Mr. Gould reported on our financial results for the fourth quarter of fiscal 2011, noting that actual results were slightly better than forecasted, and he provided additional detail regarding trends in research and development expense, selling, general and administrative expenses and changes in product revenue. Our board engaged in a discussion about the timing and content of our earnings guidance, including whether to continue to give quantitative guidance or to give only directional guidance. Mr. Gould reviewed our fiscal 2012 operating plan and expressed confidence in our new sales force, noting that he did not expect their efforts to be reflected in our financial results until at least the second quarter of fiscal 2012.

On October 17, 2011, Company D declined to continue to participate in the process for lack of strategic fit.

On October 19, 2011, Linden submitted a revised proposal to acquire 100% of our shares of common stock for a purchase price in the range of $3.85 to $3.95 per share in cash, which Linden expected to fund through a combination of equity and third-party debt financing. Linden’s proposal included a 45-day exclusivity period.

On October 20, 2011, Company E declined to continue to participate in the process for lack of strategic fit.

On October 25, 2011, our board of directors held a telephonic meeting in order to receive an update regarding our strategic process. Members of management and representatives of Foley Hoag and Lazard attended this meeting. Mr. Gould summarized the proposal from Linden and noted that we had not received any other updated proposals. The representatives of Lazard then provided a more detailed overview of the status of the sale process, including the level of interest from parties continuing to participate in the process. They reported that Linden continued to be the most engaged participant and noted that other potential strategic buyers were interested in buying only one of our business segments. Our board of directors engaged in a discussion of the merits of Linden’s proposal, including available financing, its request for exclusivity and its outstanding diligence requests. The representatives of Lazard reported Linden’s statement that its offer represented a healthy premium over current trading prices. Our board requested that Lazard ask Linden to conduct the additional diligence necessary to submit a proposal with a specific per share price, rather than a range. Our board of directors then turned to a discussion of MSMB Capital, which continued to negotiate

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ardently regarding the standstill terms that other participants had agreed to, and considered how best to induce MSMB Capital to join the sales process on substantially the same terms as other participants. The directors also considered the merits of continuing to pursue a stand-alone strategy. Our board continued to consider Linden’s proposal and concluded that we should not yet agree to exclusivity with any bidder and that the interests of our stockholders would be served by including MSMB Capital in the process to enable us to better assess the validity of its proposed purchase price of $4.25 per share. The directors authorized Mr. Gould and Lazard to negotiate a confidentiality agreement with MSMB Capital that included a standstill period that would expire on February 1, 2012 if we did not announce a definitive acquisition agreement by that date but would otherwise continue on terms similar to those in place with respect to other participants. Our board discussed the ongoing turmoil in the stock market and the impact on our sales process. The directors also considered again the feasibility of selling a single business division. Our board briefly discussed proposed earnings guidance for fiscal 2012, the potential impact of our earnings release on the sale process and the fact that a major stockholder had expressed unhappiness that our stock price was below $3.00 per share.

On October 26, 2011, we entered into a confidentiality agreement with MSMB Capital.

On October 27, 2011, an additional potential buyer, whom we refer to as Company F, contacted Lazard and made a request to participate in the process. We agreed to allow Company F to participate and we entered into a confidentiality agreement with Company F.

From November 2, 2011 to November 8, 2011, we engaged with Company F in management meetings, telephone calls and a site visit.

On November 7, 2011, Linden submitted a third proposal to acquire 100% of our shares of common stock for a price of $3.90 per share, which Linden expected to fund through a combination of equity and third-party debt financing. Linden subsequently followed up with a proposal to fund the transaction solely with equity from Linden. On the same day, management participated in a meeting with MSMB Capital at our Massachusetts facility.

On November 9, 2011, Company F submitted a proposal to acquire us at a purchase price of $4.26 per share through a transaction to be financed entirely with equity from a fund that was in the process of formation.

On November 10, 2011, Linden supplemented its proposal with a letter from its lender to the effect that Linden had available a $75.0 million line of credit as evidence of its ability to fund the proposed transaction quickly and with certainty.

On November 11, 2011, our board of directors held a telephonic meeting. Mr. Gould and representatives of Foley Hoag and Lazard attended this meeting. The Lazard representatives reviewed the status of negotiations with each of Linden, Company F and MSMB Capital. They reported that Company F had proposed a purchase price of $4.26 per share, the highest definitive offer received during the current strategic process, but only $0.01 per share more than MSMB Capital’s public offer of $4.25 per share. They noted that Company F was a late entrant into the process but had moved quickly and invested significant resources to conduct diligence, hold several meetings with management and submit a proposal. The Lazard representatives reported that Linden had proposed $3.90 per share and had eliminated some of the diligence conditions stated in its offer. They also noted that Linden had provided a letter from its lender stating that Linden had a $75.0 million line of credit. They reported Linden’s growing impatience and its insistence on exclusivity in order to move forward. The representatives of Lazard reported that MSMB Capital had met with management, had been conducting diligence and had reached out to three funding sources. They provided our board with more background information regarding Company F and its anticipated equity financing sources. They noted that, although Company F had not yet completed the formation of its fund, the Company F management team had prior proven successes and had volunteered to provide us with direct access to Company F’s anticipated equity investors. Based on Lazard’s diligence, the Lazard representatives expressed a high degree of confidence that Company F would complete its equity financing but expressed uncertainty regarding the exact timing of the closing of that financing. Our board considered the risks associated with Company F’s lack of fully committed capital, whether there was an opportunity to negotiate an increase in its offer price, and its request for exclusivity. The directors then engaged in a discussion of the three outstanding proposals,

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including strategies for obtaining the best price and whether to grant exclusivity to any participant. It was the consensus of our board of directors that Linden was the most promising buyer with the greatest likelihood of completing a transaction but that its offer price of $3.90 per share was low. Our board then instructed Lazard to ask Company F for additional clarity and evidence regarding the likelihood and timing of completing the formation of its fund. Our board also instructed Lazard to request a proposal from MSMB Capital and to inform Linden that it would not receive exclusivity at an offer price of $3.90 per share.

On November 15, 2011, an affiliate of MSMB Capital submitted a proposal to acquire us for $3.75 per share in cash, which would be funded with $35.0 million in equity from the affiliate and with new third-party debt for the balance.

On November 16, 2011, Company F provided us with non-binding written equity commitments from two of its anticipated investors. Also on that day, our board of directors held an in-person meeting in Boston. Members of management and representatives of Foley Hoag and Lazard attended this meeting. The Lazard representatives reviewed the three current proposals with our board, including the $0.50 per share price reduction from MSMB Capital, and a representative of Foley Hoag provided advice regarding our board’s fiduciary obligations. Lazard reported that Linden was aware that it had not offered the highest price and that Linden was emphasizing instead its track record in completing transactions and its belief that it was offering certainty of completion. Our board of directors considered strategies to cause Linden to raise its price closer to that offered by Company F. Based on the Lazard representative’s description of negotiations with Linden regarding price, our board of directors did not expect that Linden would match Company F’s offer price but thought that, if Linden were given credit for its stated certainty of completion, it would agree to a price increase in exchange for exclusivity. Our board also considered the risk that Linden would terminate negotiations if our asking price were too high. After weighing the benefits of the Linden proposal, including the greater certainty of financing and the perceived higher likelihood of completion, against the higher price offered by Company F, our board authorized Lazard to offer Linden a 30-day period of exclusive negotiation if it would commit to a price of $4.25 per share, which matched the public offer made by MSMB Capital. Our board of directors expected that Linden would make a counter-offer at a lower price, thereby affording us additional time to negotiate with Company F. Our board of directors determined that, if Linden did not commit to a purchase price of $4.25 per share, it would allow all parties to finalize their diligence without exclusivity, recognizing that it was unlikely that Linden would move forward without exclusivity.

On November 17, 2011, we reported our financial results for the fourth quarter of fiscal 2011, which represented the fourth consecutive quarter of year-over-year declines. We reported revenue of $11.0 million for that quarter, which reflected a 17% decline over our revenue of $13.3 million in the fourth quarter of fiscal 2010. We also reported a net loss of $0.8 million for the fourth quarter of fiscal 2011, which reflected $1.4 million of costs related to severance charges and our evaluation of strategic alternatives, and which also represented a $2.8 million decline from our net income of $2.0 million in the fourth quarter of fiscal 2010.

Also on November 17, 2011, MSMB Capital orally increased its proposal to $4.00 per share with no change to the financing arrangement. On the same day, Linden orally agreed to a purchase price of $4.25 per share, which would be fully financed with Linden equity, with a 30-day exclusivity period.

On November 18, 2011, our board of directors held a telephonic meeting. Mr. Gould and representatives of Foley Hoag and Lazard attended this meeting. Our board considered the latest proposal from Linden and directed Lazard to advise Company F that it should submit its best and final offer, including terms that would enhance the certainty of financing, by the end of the day. Our board believed that it should continue to weigh pricing against risks to completion and that, if Company F were to offer a meaningfully higher price than Linden, then our board would reassess whether the increase in price would be sufficient to offset the greater uncertainty of successful completion. Our board authorized Mr. Gould to execute and deliver an exclusivity agreement with Linden unless Company F increased its offer price before such execution and delivery. Company F did not offer any increase in its proposed purchase price of $4.26 per share.

On November 21, 2011, we entered into a 30-day exclusivity period with Linden and circulated a draft of the proposed merger agreement to Kirkland & Ellis LLP, Linden’s counsel. Mr. Gould and representatives of Lazard and Foley Hoag participated in a call with Linden and its advisors to discuss due diligence, the schedule for additional meetings with management and the timing of potential calls with our key customers.

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From November 21, 2011 through the execution of the merger agreement, Linden conducted due diligence, engaged in meetings with management and completed customer calls.

On November 25, 2011, representatives of Foley Hoag contacted representatives of Kirkland & Ellis to discuss our proposal to structure the acquisition as a two-step tender offer.

On November 29, 2011, we engaged BDO, our independent registered public accounting firm, in connection with the proposed transaction diligence that Linden would perform.

On November 30, 2011, Linden advised Mr. Gould that it intended to appoint someone from outside our Company as our President and Chief Executive Officer upon consummation of the transaction.

On December 1, 2011, representatives of Foley Hoag and Kirkland & Ellis had a preliminary call regarding the structure of the proposed transaction and the terms of the merger agreement.

On December 2, 2011, our board of directors held a telephonic meeting. Mr. Gould and representatives of Foley Hoag and Lazard attended this meeting. A representative of Lazard reported on the status of events with Linden, including progress with due diligence and meetings with management. He also reported that a representative of Linden had been conducting employee interviews, touring our facilities in Massachusetts and Maryland and accompanying Mr. Gould to various meetings for a week. The representative of Lazard reported on Linden’s expected timing for the execution of the definitive agreement and reminded our board of directors that Linden’s period of exclusivity would expire the week of December 19, 2011. The representative of Foley Hoag reported on his recent conversation with Linden’s counsel regarding Linden’s preference to structure the transaction as a traditional merger rather than as a two-step tender offer, and he described the merits of the two approaches. Mr. Gould provided an overview of our preliminary financial results for the months of October and November, noting that the results generally were ahead of budget, including a significant increase in revenue over the comparable periods of the prior year.

On December 3, 2011, Foley Hoag circulated a draft of the sponsor guarantee to Kirkland & Ellis and on December 7, 2011, Kirkland & Ellis circulated a revised draft of the merger agreement to Foley Hoag.

On December 9 and 10, 2011, we had calls with Linden and our respective financial advisors to discuss the competitive landscape for our business, as well as the merger agreement and progress on diligence.

On December 12, 2011, representatives of Foley Hoag and Kirkland & Ellis discussed the revised draft of the merger agreement circulated by Kirkland & Ellis. On the same day, our board of directors held a telephonic meeting. Mr. Gould and representatives of Foley Hoag and Lazard attended this meeting. Lazard provided an update on the status of Linden’s diligence review, noting that Linden typically took 45 to 60 days to complete its due diligence investigation of any target and that it was seeking to conduct the same level of diligence with respect to us in less than 30 days. The representative of Foley Hoag summarized the principal issues raised in the revised draft of the merger agreement. Our board of directors provided management and the representatives of Foley Hoag and Lazard with guidance for preparing our response to Linden’s draft.

On December 13, 2011, Foley Hoag circulated a revised draft of the merger agreement to Kirkland & Ellis, and on December 15, 2011, representatives of Foley Hoag and Kirkland & Ellis had a call to negotiate open items in the merger agreement.

On December 16, 2011, our board of directors held a telephonic meeting. Mr. Gould and representatives of Foley Hoag and Lazard attended this meeting. Mr. Gould reviewed with our board of directors our most recent financial results and his revised forecast for our financial performance in fiscal 2012, which reflected earlier-than-anticipated improvements in sales. Mr. Gould and the Lazard representatives then provided an update regarding the status of negotiations with Linden. The representative of Foley Hoag reported on the status of the merger agreement, noting in particular that the parties had significantly different positions regarding our remedies in the event of Linden’s failure to perform, with Linden proposing that specific performance would be our sole remedy under the agreement and that under no circumstances would we be entitled to receive monetary damages. The directors considered whether we should agree to any extension of exclusivity after Linden’s 30-day exclusivity period expired on December 21, 2011 and concluded that no extension of exclusivity was warranted. They then discussed the message to be conveyed to Linden, including our board’s intention not to extend exclusivity, its desire to complete a transaction with Linden on the terms

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previously agreed, its frustration with Linden’s slow pace and its fiduciary obligations to take steps to plan for Linden’s potential failure or refusal to proceed. Our board of directors directed Lazard and management to formulate plans to revive negotiations with Company F promptly after the expiration of Linden’s exclusivity period.

On December 21, 2011, our exclusivity agreement with Linden expired, and we denied its request to extend exclusivity.

On December 22, 2011, our board of directors held a telephonic meeting. Mr. Gould and representatives of Foley Hoag and Lazard attended this meeting. The representatives of Lazard reported that Linden was not pleased with our refusal to extend exclusivity, but that it had agreed to continue negotiations without exclusivity. The Lazard representatives also noted that Linden was still pursuing customer calls and did not expect to be ready to execute the merger agreement until the end of the first week of January 2012 at the earliest. Our board considered available means to accelerate negotiations with Linden and discussed whether, in light of the pending holidays, it would be possible to make meaningful progress with Company F during the upcoming weeks. Our board of directors instructed Mr. Gould and Lazard to rekindle discussions with Company F immediately and Lazard had a call with Company F later that same day.

On December 28, 2011, Lazard contacted William Blair about the status of the merger agreement and was informed that Linden was focusing on diligence at that time.

On or about December 29, 2011, Company F engaged a consultant to advise it regarding a proposed transaction with us.

On January 5, 2012, our chairman spoke with a Linden representative regarding how long the process was taking and was informed by the Linden representative that he was looking forward to the in-person meeting scheduled for the following Tuesday in San Francisco, at which time Linden would make a revised offer.

On January 9, 2012, Mr. Gould and representatives of Lazard met with representatives of Company F to discuss its interest in a transaction with us, as well as diligence and Company F’s process timeline.

On January 10, 2012, our chairman of the board, Mr. Gould and representatives of Lazard met with representatives of Linden and a representative of William Blair. The representatives of Linden did not present a revised offer but instead stated that they would provide a price and revised documents to us by January 17, 2012. Our chairman informed Linden that we were prepared to continue to operate as a stand-alone company and that we wanted to announce a transaction, if at all, by the end of the month.

On January 18, 2012, our board of directors had a telephonic meeting. Mr. Gould and representatives of Foley Hoag and Lazard attended this meeting. A representative of Lazard reported that William Blair had advised him that Linden was preparing a package, including the merger agreement and price, to be delivered to us no later than January 20, 2012. Our board of directors discussed the delay in receiving the revised proposal from Linden, as well as available alternatives to expedite the process. A Lazard representative then provided an update regarding recent communications with Company F. He reported that Lazard had approached Company F immediately after Linden’s exclusivity period expired and that Lazard and our management had had a number of calls with representatives of Company F, as well as a site visit to our Maryland location. He noted that Company F continued to express interest in a transaction with us, but that it was reluctant to engage in substantial diligence while we continued to negotiate with Linden because of the risk of expending resources on due diligence only to have us conclude a deal with Linden. The directors considered whether it would be advantageous to shift our focus to Company F, or even to grant it a limited exclusivity period, to encourage it to conduct diligence. The representatives of Lazard reported that MSMB Capital had made an oral offer of $4.00 per share and that Lazard had advised MSMB Capital that $4.00 was too low, especially in light of its uncertain financing and uncertain ability to consummate a transaction. Our board of directors discussed the timing of our earnings release, and Mr. Gould noted that, in recent periods, we had announced our results of operations for the first quarter around February 7 or 8 of the following year. The directors considered whether we should seek to release our results for the first quarter of fiscal 2012 earlier this year and what might be said about our strategic process.

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On January 19, 2012, Linden submitted a revised proposal pursuant to which it offered to purchase all of our outstanding shares of common stock for $3.75 per share and circulated a revised draft of the merger agreement. Linden provided a definitive bid analysis purporting to justify the reduction in its offer price from $4.25 per share to $3.75 per share. On the same day, Mr. Gould and representatives of Lazard spoke with representatives of Company F about re-engaging with them and continuing diligence. Company F confirmed that it was interested and that it would follow up on January 24 regarding price and a process timeline. Company F requested exclusivity and was informed that we needed to understand its proposed timeline before responding to the request.

On January 21, 2012, our board of directors had a telephonic meeting to discuss the revised offer from Linden. Mr. Gould and representatives of Foley Hoag and Lazard attended this meeting. After considering the revised proposal from Linden, our board of directors unanimously rejected it and directed Lazard to remove Linden’s access to our data room. The directors decided to consider other alternatives and directed management and Lazard to proceed with preparing a merger agreement for Company F. Our board asked management and Lazard to make a presentation to the board regarding other strategic alternatives, including a stock repurchase program, a substantial, one-time cash dividend and a program of continuing dividends.

On January 22, 2012, we circulated a draft merger agreement to Company F.

On January 24, 2012, Linden revised its proposal to offer $4.00 per share, but did not circulate revised merger documents. On the same day, our board of directors had a telephonic meeting. Mr. Gould and representatives of Foley Hoag and Lazard attended this meeting. A representative of Lazard provided an update regarding his call with Linden on January 21, 2012 in which he had informed Linden that our board of directors had determined that we would not be moving forward with Linden’s proposal. He reported on Linden’s revised proposal of $4.00 per share, which had been received shortly before the board call, and stated that Linden considered the $4.00 price to be the “maximum” that it would pay. The Lazard representative indicated that Linden also wanted to compromise on the outstanding issues with respect to the remedies provision in the merger agreement. He noted that Linden had given us 48 hours to respond to its latest proposal. The Lazard representative next reported that Company F had completed the formation of its fund and was still interested, but that Company F had stated that it would need at least 30 days to get to an agreement. After further discussion with the Lazard representative, Company F had stated that it might be able to move faster, but only at a substantially lower purchase price. Our board of directors discussed how to respond to Linden and Company F, as well as the timing of the earnings announcement. Our board directed management and Lazard to continue to negotiate with Linden while seeking to engage Company F to pursue a transaction with us.

On January 25, 2012, Lazard had a call with Company F, who agreed to operate non-exclusively for the moment while conducting additional due diligence. Also on that day, representatives of Foley Hoag and Kirkland & Ellis participated in a call to discuss Linden’s proposal for the remedies we would have under the merger agreement, which had not changed materially from its last proposal on December 16, 2011.

On January 26, 2012, Kirkland & Ellis reported to Foley Hoag that Linden would submit a revised proposal that would include a reverse break-up fee and an equity commitment letter. The next day, Kirkland & Ellis circulated a revised merger agreement and guarantee, as well as a draft equity commitment letter.

On January 28, 2012, our counsel circulated a list of open issues regarding the merger agreement to our board of directors. On the same day, Linden and Blair called Lazard about the timing of the transaction.

On January 30, 2012, our board of directors had a telephonic meeting to discuss Linden’s current proposal and merger documents. Mr. Gould and representatives of Foley Hoag and Lazard attended this meeting. The Foley Hoag representative discussed the open issues regarding the merger agreement, and our board of directors provided feedback on how to respond to each issue. The directors then discussed the message to send to Linden, including whether to compromise on price. After discussion, our board of directors directed Mr. Gould and Lazard to contact Linden with a counterproposal of $4.15 per share, to be followed by revised merger documents. The board expressed its desire to see from Linden both a final price and final terms. A Lazard representative reported that Company F was attempting to schedule a management meeting, but had been unsuccessful due to competing priorities.

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On January 31, 2012, Foley Hoag circulated revised merger documents to Kirkland & Ellis.

On February 1, 2012, Linden rejected our proposal of $4.15 per share and maintained its offer price of $4.00 per share.

On February 2, 2012, Linden suggested an in-person meeting to resolve the outstanding issues. We proposed instead a lawyers’ call to be held on February 3, 2012 to determine whether the outstanding legal issues could be resolved before asking our board of directors to respond to Linden’s position on price.

On February 3, 2012, counsel for each side continued to negotiate the merger documents. Representatives of Foley Hoag and Kirkland & Ellis circulated updated lists of the open issues to their respective clients. On the same day, a representative from Lazard attempted to contact Company F to schedule a management meeting.

On February 4, 2012, Mr. Gould and representatives of Lazard provided Linden with a rebuttal of Linden’s definitive bid analysis and arguments supporting a purchase price of $4.15 per share. Linden maintained its offer price of $4.00 per share, arguing that it was providing the best package with the most deal certainty. During the same time, our and Linden’s tax specialists negotiated the tax provisions of merger agreement, and Foley Hoag circulated revised drafts of the merger documents to Kirkland & Ellis.

On February 6, 2012, our board of directors had a telephonic meeting. Mr. Gould and representatives of Foley Hoag and Lazard attended this meeting. A representative of Lazard reported that Linden had reviewed our rebuttal analysis but was unwilling to change its price. Mr. Gould then reported on his call with one of Linden’s principals, which was consistent with the message that Lazard had received. The directors noted that we had not yet received comments on the merger documents and determined that we should not respond on price until after receiving revised drafts of the merger documents. On the same day, Company F notified Lazard that it could not schedule a management meeting until the end of the month due to competing priorities.

On February 7, 2012, Mr. Gould and representatives of Linden, Lazard, William Blair, Foley Hoag and Kirkland & Ellis participated in a conference call to discuss the remaining open issues on the merger documents. During the call, the parties agreed to put aside price and finalize the terms of the merger documents.

On February 8, 2012, we hosted a site visit by one of Linden’s representatives for further diligence.

On February 8 and 9, 2012, representatives of Foley Hoag and Kirkland & Ellis continued to negotiate the terms of the merger documents.

On February 9, 2012, our board of directors held a telephonic meeting to review the progress of the transaction. Mr. Gould and representatives of Foley Hoag and Lazard attended this meeting. Following a presentation by the Foley Hoag representative, the directors considered the key terms of the proposed merger agreement, including final compromises on terms involving our remedies, the size of the termination fee, the size of the reverse termination fee, the cap on Linden’s expense reimbursement and the terms of the non-solicitation covenant, including Linden’s associated termination rights. The representatives of Lazard then reviewed with our board of directors the financial analyses of the proposed transaction that Lazard had performed in preparation for the delivery of its fairness opinion. The directors discussed the financial analyses with the representatives of Lazard, noting that Lazard’s discounted cash flow analysis was based on the “middle” case of the financial projections provided by management. After discussion, our board asked Lazard whether it could also analyze the fairness of the merger consideration based on the “high” case of the financial projections provided by management.

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On February 10, 2012, we announced our financial results for the first quarter of fiscal 2012, which showed year-over-year improvement in our revenue. Later that day, our board of directors held a telephonic meeting. Mr. Gould and representatives of Foley Hoag and Lazard attended this meeting. Our board of directors considered our financial results for the quarter, noting that, although the single quarter reflected a change in the trajectory of our financial performance from the prior four quarters, significant future operational risks and uncertainties remained. The directors discussed Linden’s proposed price of $4.00 per share and whether the board should accept that price. Our board of directors discussed whether there remained any opportunity to negotiate a further increase in the offer price from Linden. In light of the extended negotiations and Linden’s repeated refusal to consider any price over $4.00 per share, our board of directors concluded that $4.00 per share was the maximum price that Linden would pay. Our board also considered that either Company F had not engaged in meaningful diligence due to competing priorities and that MSMB Capital had orally offered $4.00 per share but with only limited diligence and subject to the condition that it would require debt financing. Our board weighed the immediate availability of Linden’s offer against the possibility that either Company F or MSMB Capital would, after additional diligence and negotiation of definitive documentation, both exceed Linden’s price and offer the same or better terms, if at all. Our board also considered the increasing risk that Linden would terminate negotiations and pursue other opportunities if we did not accept its offer. Our board of directors ultimately approved Linden’s purchase price of $4.00 per share, subject to the delivery of Lazard’s fairness opinion and related revised financial analyses and the finalization of the merger documents and the disclosure schedule.

On February 12, 2012, our board of directors held a telephonic meeting to discuss the transaction. Mr. Gould and representatives of Foley Hoag and Lazard attended this meeting. The representatives of Lazard reviewed with our board of directors Lazard’s updated financial analyses of the proposed transaction, noting that Lazard had updated its discounted cash flow analysis to consider each of the “high,” “middle” and “low” cases of the financial projections prepared by management. After discussion, the representatives of Lazard delivered Lazard’s oral opinion, subsequently confirmed in writing, that, as of February 12, 2012, based upon and subject to the various assumptions, procedures, factors, qualifications and limitations set forth in the written opinion, the cash merger consideration of $4.00 per share to be received by holders of shares of our common stock pursuant to the merger agreement was fair, from a financial point of view, to such holders.

The Foley Hoag representative then reviewed with the directors their fiduciary duties in connection with a decision to sell the company. Our board of directors considered the thoroughness of the sale process that Lazard had conducted, including the number of parties contacted, the number of indications of interest delivered and the number of proposals received. Our board of directors considered the other strategic alternatives that the board had evaluated as means to deliver value to stockholders, including a sale of a business division, potential mergers and acquisitions, a stock repurchase program, a substantial, one-time cash dividend and a program of ongoing dividend payments. Our board considered whether any of these options, as well as remaining a stand-alone company, in lieu of a sale, would offer better value to stockholders. Our board considered its prior discussions of our financial performance over recent periods, including the four consecutive quarters of year-over-year declines during fiscal 2011. Following a presentation by the Foley Hoag representative, our board of directors considered the key terms of the merger agreement, the sponsor guarantee and the equity commitment letter, including in particular the terms of the non-solicitation covenant, the size of the termination fee, the ability to pursue superior offers under specified conditions, Linden’s matching rights, the parties’ remedies for breach, the reverse termination fee provisions, the terms under which the parties could terminate the merger agreement and the fees and expenses that would or might become payable upon or following termination.

Following these presentations and the related discussions, our board of directors unanimously approved the $4.00 per share price and the other terms of the transaction, unanimously determined that the merger agreement was advisable and in the best interests of our company and our stockholders, unanimously approved the merger in accordance with the General Corporation Law of the State of Delaware, and unanimously recommended that our stockholders vote in favor of adoption of the merger agreement.

Later that evening, we and Linden executed the merger agreement and Linden delivered the executed sponsor guarantee and equity commitment letter.

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On February 13, 2012, we issued a press release announcing the execution of the merger agreement.

On February 26, 2012, our board of directors held a telephonic meeting. Representatives of Foley Hoag were present at this meeting. Our board of directors considered an amendment to the merger agreement to amend and restate the certificate of incorporation of the surviving corporation to substantially conform its indemnification and advancement of expenses provisions to those included in our current certificate of incorporation. After discussing the amendment with the Foley Hoag representative, our board of directors approved the amendment.

On February 27, 2012, Buyer and the Merger Subsidiary approved the amendment and the parties entered into the amendment.

Reasons for the Merger and Recommendation of our Board of Directors

Our board of directors, with the assistance of our management and our legal and financial advisors, carefully evaluated the terms and conditions of the proposed merger, including the terms of the merger agreement, the equity commitment letter and the sponsor guarantee, and concluded that the proposed merger represented the best course of action reasonably available for our stockholders. At the meeting held on February 12, 2012 described above, the board of directors unanimously (i) determined that the merger agreement, the merger and the other transactions contemplated by the merger agreement are advisable and in the best interests of our company and our stockholders, (ii) approved the merger agreement, (iii) resolved to recommend that stockholders vote in favor of the adoption of the merger agreement, and (iv) directed that such matter be submitted for the consideration of our stockholders at the special meeting.

In evaluating the merger agreement, the merger and the other transactions contemplated by the merger agreement, the board of directors considered a number of substantive factors, both positive and negative, and potential benefits and detriments of the merger. Our board of directors believed that, taken as a whole, the following factors supported its decision to approve the proposed merger:

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See “The Merger Agreement” beginning on page 62 of this proxy statement, for a more complete description of the terms and conditions of the merger agreement.

Our board of directors also considered potential risks or negative factors relating to the merger, including the following:

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Our board of directors concluded that the potentially negative factors associated with the proposed merger were outweighed by the opportunity for our stockholders to realize a significant premium on the value of their common stock and monetize their investment in us for the cash merger consideration of $4.00 per share. Our board of directors believed that the proposed merger would maximize the immediate value of the stockholders’ shares and eliminate the unavoidable risks and uncertainties affecting our future prospects. Accordingly, our board of directors determined that the merger is fair to, and in the best interests of, our company and our stockholders, and approved and declared advisable the merger agreement, the merger and the other transactions contemplated by the merger agreement.

The foregoing discussion of the information and factors considered by the board of directors is not intended to be exhaustive, but includes the material factors considered by the board of directors. In view of the variety of factors considered in connection with its evaluation of the merger, the board of directors did not find it practicable to, and did not, quantify or otherwise assign relative weights to the specific factors considered in reaching its determination and recommendation. In addition, individual directors may have given different weights to different factors. The board of directors did not undertake to make any specific determination as to whether any factor, or any particular aspect of any factor, supported or did not support its ultimate determination. The board of directors based its recommendation on the totality of the information presented.

The board of directors recommends that you vote “FOR” approval of the merger proposal.

In considering the recommendation of our board of directors with respect to the merger proposal, you should be aware that our directors and executive officers have interests in the merger that may be different from, or in addition to, those of our stockholders generally. The board of directors was aware of and

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considered these interests, among other matters, in evaluating and negotiating the merger agreement and the merger, and in recommending that the merger agreement be adopted by our stockholders. See “— Interests of Our Directors and Executive Officers in the Merger” beginning on page 52 of this proxy statement.

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Opinion of SeraCare’s Financial Advisor

In connection with the merger, on February 12, 2012, Lazard rendered its oral opinion, subsequently confirmed in writing, to our board of directors that, as of such date, and based upon and subject to the assumptions, procedures, factors, qualifications and limitations set forth therein, the merger consideration of $4.00 per share in cash was fair, from a financial point of view, to holders of our common stock.

The full text of Lazard’s opinion, dated February 12, 2012, which sets forth the assumptions made, procedures followed, factors considered and qualifications and limitations on the review undertaken by Lazard in connection with its opinion, is attached to this proxy statement as Annex B and is incorporated into this proxy statement by reference. We encourage you to read Lazard’s opinion and this section carefully and in their entirety.

Lazard’s opinion was directed to our board of directors for the information and assistance of our board of directors in connection with its evaluation of the merger and addressed only the fairness as of the date of the opinion, from a financial point of view, of the merger consideration to the holders of our common stock. Lazard’s opinion was not intended to and does not constitute a recommendation to any stockholder as to how such stockholder should vote or act with respect to the merger or any matter relating thereto. Lazard’s opinion was necessarily based on economic, monetary, market and other conditions as in effect on, and the information made available to Lazard as of the date of, the opinion. Lazard assumed no responsibility for updating or revising its opinion based on circumstances or events occurring after the date of the opinion. Lazard did not express any opinion as to the prices at which shares of our common stock may trade at any time subsequent to the announcement of the merger.

In connection with its opinion, Lazard:

Lazard relied upon the accuracy and completeness of the foregoing information and has not assumed any responsibility for any independent verification of such information. Lazard did not conduct any independent valuation or appraisal of any of our assets or liabilities or concerning our solvency or fair value and was not furnished with any such valuation or appraisal. With respect to financial forecasts, Lazard assumed, with our consent, that the forecasts had been reasonably prepared on bases reflecting the best currently available estimates and judgments of our management as to our future financial performance. Lazard did not assume any responsibility for and expressed no view as to such financial forecasts and estimates or the assumptions on which they were based.

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In rendering its opinion, Lazard assumed, with our consent, that the final terms of the merger agreement would not vary materially from those set forth in the latest draft reviewed by Lazard, and that the merger would be consummated on the terms described in the latest draft of the merger agreement, without any waiver or modification of any material terms or conditions, and that obtaining the necessary regulatory approvals for the merger would not have an adverse effect on us. Lazard did not express any opinion as to any tax or other consequences that might result from the merger, nor does its opinion address any legal, tax, regulatory or accounting matters, as to which Lazard understood that we had obtained such advice as we deemed necessary from qualified professionals. Lazard expressed no view or opinion as to any terms or other aspects of the transaction (other than the merger consideration to the extent expressly specified in its opinion), including without limitation, the sponsor guarantee. In addition, Lazard expressed no view or opinion as to the fairness of the amount or nature of, or any other aspects relating to, the compensation of any officers, directors or employees of any parties to the transaction, or class of such persons, relative to the merger consideration or otherwise.

The following is a summary of the material financial and comparative analyses that Lazard deemed to be appropriate for this type of transaction and that were reviewed with our board of directors in connection with rendering its opinion. The summary of Lazard’s analyses described below is not a complete description of the analyses underlying Lazard’s opinion. The preparation of a financial opinion is a complex analytical process involving various determinations as to the most appropriate and relevant methods of financial analysis and the application of those methods to the particular circumstances, and, therefore, is not readily susceptible to summary description. In arriving at its opinion, Lazard considered the results of all the analyses and did not draw, in isolation, conclusions from or with regard to any factor or analysis considered by it. Rather, Lazard made its determination as to fairness on the basis of its experience and professional judgment after considering the results of all of the analyses.

In its analyses, Lazard considered industry performance, general business, economic, market and financial conditions and other matters, many of which are beyond our control. No company, business or transaction used in Lazard’s analyses is identical or directly comparable to us or the merger, and an evaluation of the results of those analyses is not entirely mathematical. Rather, the analyses involve complex considerations and judgments concerning financial and operating characteristics and other factors that could affect the acquisition, public trading or other values of the companies or businesses analyzed. The estimates contained in Lazard’s analyses and the ranges of valuations resulting from any particular analysis are not necessarily indicative of actual values or predictive of future results or values, which may be significantly more or less favorable than those suggested by the analyses. In addition, analyses relating to the value of businesses or securities do not purport to be appraisals or to reflect the prices at which businesses or securities actually may be sold. Accordingly, the estimates used in, and the results derived from, Lazard’s analyses are inherently subject to substantial uncertainty.

The financial analyses summarized below include information presented in tabular format. In order to fully understand Lazard’s financial analyses, the tables must be read together with the text of each summary. The tables alone do not constitute a complete description of the financial analyses. Considering the data in the tables below without considering the full narrative description of the financial analyses, including the methodologies and assumptions underlying the analyses, could create a misleading or incomplete view of Lazard’s financial analyses.

Discounted Cash Flow Analysis

Lazard performed an analysis of the net present value of (i) projected operating free cash flows through the end of fiscal 2016 using each of the Case A, Case B and Case C forecast prepared by our management plus (ii) our terminal value at the end of such period. Lazard noted that our management had advised them that the Case A forecast was based on the best estimates and judgments of our management on the expected future performance of our business, the Case B forecasts reflected potential concerns that could lead to lower than expected future performance of the business and the Case C forecast was adjusted to incorporate potential upside that could lead to higher than expected future performance of the business. Our terminal value was calculated based on a range of perpetuity growth rates of 4.0%, 5.09% and 6.0% for our diagnostic and biopharmaceutical products segment and a range of perpetuity growth rates of 1.0%, 2.0% and 3.0% for our bioservices segment. The cash flows and terminal value were then discounted using discount rates ranging

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from 17.5% to 22.5%. The assumed discount rate range was derived from the weighted average cost of capital analysis that Lazard calculated for us. Based on this analysis, Lazard arrived at the following implied value per share range for our common stock in each of Case A, Case B and Case C, as follows:

Case A		$	3.27 – $4.41
Case B		$	2.41 – $3.04
Case C		$	3.65 – $5.00

Lazard noted that the ranges for Case A and Case C are inclusive of the merger consideration of $4.00 per share and that the range for Case B is below the merger consideration of $4.00 per share.

Selected Comparable Companies Analysis

Lazard reviewed and analyzed selected publicly available financial and other data of the companies listed below having businesses and trading characteristics that it deemed reasonably comparable to us. Lazard noted that, given our unique profile, there is a very limited number of comparable publicly traded comparable companies.

Affymetrix, Inc.
Harvard Bioscience, Inc.
Enzo Biochem, Inc.

Based on publicly available information, Lazard reviewed, among other things, the enterprise value of each selected comparable company as a multiple of such comparable company’s revenues and EBITDA for the last twelve months, or LTM. A company’s enterprise value is equal to its short-term and long-term debt plus the market value of its common equity and the value of any preferred stock (at liquidation value), minus its cash and cash equivalents.

Lazard calculated the following multiples for the above comparable companies:

		Enterprise Value/ LTM Revenue		Enterprise Value/ LTM EBITDA
High			1.5x				9.2x
Median			1.1x				9.1x
Low			0.8x				9.1x

Based on the foregoing, Lazard applied revenue multiples of 0.8x to 1.5x to our LTM revenues and EBITDA multiples of 9.1x to 9.2x to our LTM EBITDA and determined an implied price range for our common stock of $2.78 to $4.09 per share based on the revenue multiple and an implied price range for our common stock of $3.67 to $3.68 per share based on the EBITDA multiple. Lazard noted that the range based on the revenue multiple is inclusive of the merger consideration of $4.00 per share and the range based on the EBITDA multiple is below the merger consideration of $4.00 per share.

Selected Precedent Transactions Analysis

Lazard reviewed, to the extent publicly available, financial information relating to four selected transactions involving life sciences companies. In performing these analyses, Lazard analyzed certain financial information and transaction multiples relating to companies in the selected transactions and compared such information to the corresponding information for us.

Specifically, Lazard reviewed four merger and acquisition transactions since May 2007 involving companies in the life sciences industry for which sufficient public information was available. Lazard reviewed the transaction value compared to the LTM revenue of the target company.

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The precedent transactions reviewed were:

Announcement Date		Acquiror		Target
11/18/2010		Sekisui Chemical Co., Inc.		Genzyme Corporation (Diagnostics Business)
08/30/2010		New Mountain Capital, LLC		Mallinckrodt Baker, Inc.
09/23/2009		North Atlantic Value LLP		Celesis International plc
05/30/2007		Enzo Biochem, Inc.		Axxora Life Sciences, Inc.

Lazard calculated the following multiples for the above selected transactions used in its analysis:

		Transaction Value as a Multiple of LTM Revenue
High			1.7x
Median			1.3x
Low			0.7x

Based on the foregoing, Lazard applied multiples of 0.7x to 1.7x to our LTM revenues and determined an implied price range for our common stock of $2.48 to $4.61 per share. Lazard noted that this range is inclusive of the merger consideration of $4.00 per share.

Premia Paid Analysis

Lazard also performed a premia paid analysis, which is designed to provide a valuation of our company based on the premia paid in selected life sciences transactions involving all-cash acquisitions of public company targets with a transaction value of between $50 million and $500 million. Lazard’s analysis was based on the one-month implied premia of such transactions. The implied premia in this analysis were calculated comparing the transaction price prior to the announcement of the transaction to the target company’s stock price one month prior to the announcement of the transaction. The results of these calculations are as follows:

		Range		Median
One-Month			12% – 49	%			26	%

From these premia, Lazard, based on its experience with merger and acquisitions transactions, derived a reference range for our common stock as of February 12, 2012 of $3.45 to $4.59 per share. Lazard noted that the market price of our common stock of $3.58 per share as of February 12, 2012 and the per share consideration of $4.00 were both within the range.

Miscellaneous

Under the terms of our engagement letter with Lazard, we paid Lazard a $150,000 financial advisory fee upon execution of the engagement letter, and we paid Lazard an additional $500,000 upon the delivery of its fairness opinion. We also agreed to pay Lazard an additional $1.1 million upon completion of the transaction. In addition, we agreed to reimburse Lazard for all reasonable expenses incurred in connection with its engagement, including travel costs, document production fees and the fees of Lazard’s outside counsel.

Lazard, as part of its investment banking business, is continually engaged in the valuation of businesses and their securities in connection with mergers and acquisitions, negotiated underwritings, secondary distributions of listed and unlisted securities, private placements, leveraged buyouts, and valuations for estate, corporate and other purposes. In the ordinary course of their respective businesses, affiliates of Lazard Frères & Co. LLC and LFCM Holdings LLC (an entity indirectly owned in large part by managing directors of Lazard Frères & Co. LLC) may actively trade our securities for their own accounts and for the accounts of their customers and, accordingly, may at any time hold a long or short position in our securities. The issuance of Lazard’s opinion was approved by an authorized committee of Lazard Frères & Co. LLC.

Lazard is an internationally recognized investment banking firm providing a full range of financial advisory and other services. Our board of directors selected Lazard to act as our investment banker because of its qualifications, expertise and reputation in investment banking and mergers and acquisitions, its familiarity with our business and the terms of its engagement.

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We and Buyer determined the merger consideration to be paid to the holders of our common stock in the merger through arm’s-length negotiations, and our board of directors approved the merger consideration. Lazard conducted the analyses and reviews summarized above for the purpose of providing an opinion to our board of directors as to the fairness, from a financial point of view, to the holders of our common stock (other than Buyer, the Merger Subsidiary and stockholders who properly demand an appraisal of their shares under the DGCL) of the merger consideration to be paid to such holders in the merger. Lazard did not recommend any specific consideration to our board of directors or any other person or indicate that any given consideration constituted the only appropriate consideration for the merger.

Lazard’s opinion was one of many factors considered by our board of directors. Consequently, the summary of the analyses and reviews provided above should not be viewed as determinative of the opinion of our board of directors with respect to the merger consideration or of whether our board of directors would have been willing to recommend a different transaction or determine that a different merger consideration was fair. For a description of the other factors considered by our board of directors, see “— Reasons for the Merger and Recommendation of our Board of Directors” beginning on page 35 of this proxy statement. Lazard has consented to the inclusion of and references to its opinion in this document.

In performing its analyses, Lazard made numerous assumptions with respect to industry performance, general business, economic, market and financial conditions and other matters. Because those analyses are inherently subject to uncertainty, being based upon numerous factors or events beyond our control or the control of our advisors, neither we, Lazard nor any other person assumes any responsibility if future results or actual values are materially different from the forecasts or estimates contained in the analyses.

Certain Prospective Financial Information

During the third quarter of fiscal 2011, we ceased making specific public projections regarding our future financial performance, earnings or other results due to the unpredictability of the underlying assumptions and estimates. However, in connection with the strategic process described under “The Merger — Background of the Merger” beginning on page 19 of this proxy statement, our management prepared certain stand-alone financial forecasts for fiscal 2011 through fiscal 2016 for use by our board of directors and Lazard. During the period between our engagement of Lazard in July 2011 and the rendering of its fairness opinion in February 2012, we updated these forecasts to reflect new information, including our actual results for fiscal 2011 and the three months ended December 31, 2011. The projections consist of three different cases, a “high case,” a “middle case” and a “low case,” which reflect our management’s judgment of a reasonable range of possible future financial results of our business. We have included below a summary of the most recent forecasts for fiscal 2012 through fiscal 2016 provided to Lazard prior to the rendering of its fairness opinion to our board of directors and performing its related financial analyses, as described under “The Merger — Opinion of SeraCare’s Financial Advisor” beginning on page 41 of this proxy statement. We refer to these five-year forecasts as the projections. In many respects, the projections are subjective. We cannot provide any assurance that our actual financial results will not fall outside the range of results reflected in the projections. Each of the three cases represents substantially the same operating plan except with respect to the amount of revenue and the expenses that we would expect to vary with changes in revenue, such as the amounts payable under our management incentive plan (under which bonus amounts would vary with changes in revenue and other financial metrics), our profit margins (which would vary with changes in revenue as a result of economies of scale), and the size of and compensation for our sales force (which we would expect to grow more quickly with more substantial increases in revenue), and except as described in the additional assumptions set forth below. Our current operating plan is intended to enable us to achieve the high case in the projections for fiscal 2012, but we regard the revenue targets in the high case as aggressive, since they require achievement of quarterly product revenue targets in each of the third and fourth quarters of fiscal 2012 that would set a record for quarterly product revenue for the last five years.

We shared earlier versions of some of our projections for fiscal 2011 through fiscal 2014 on a confidential basis with Linden and other potential buyers in connection with their due diligence review of our company. These earlier versions did not reflect the new information, including our actual results for the three months ended December 31, 2011, reflected in the projections and, accordingly, to the extent that these earlier versions varied materially from the projections, they are even less reliable than the projections.

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The projections were prepared by, and are the responsibility of, our management. The projections were intended for use only by sophisticated business persons who have extensive experience analyzing subjective financial projections, who are capable of appreciating the uncertainties inherent in those projections and who were expected to perform their own critical analyses of the projections based on a thorough understanding of our industry and competitive position. You should read the projections with a much lower level of confidence in their accuracy than you have when reading historical financial statements. Moreover, the projections were not prepared with a view toward public disclosure and, accordingly, do not comply with published guidelines of the Securities and Exchange Commission, the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of financial forecasts, or generally accepted accounting principles, or GAAP. BDO USA, LLP, our independent registered public accounting firm, has not audited, compiled or performed any procedures with respect to the projections and does not express an opinion or any other form of assurance related thereto. The projections are not being included to influence a stockholder’s decision whether or not to vote to adopt the merger agreement, but instead are being included because they were provided to Lazard in connection with the preparation of its fairness opinion and because a subset of earlier versions of the projections was presented to Linden and certain other potential buyers in connection with their due diligence investigation of our company. We note that, in the course of our price negotiations, Linden disputed the projections on the basis that Linden projected significantly lower revenue growth from some of our larger customers.

The projections, while presented with numerical specificity, necessarily were based on numerous variables and assumptions that are inherently uncertain and many of which are beyond our control. Because the projections cover multiple years, by their nature, they become subject to increasing uncertainty with each successive year. The assumptions upon which the projections were based involve judgments with respect to, among other things, future economic, competitive and financial market conditions, all of which are difficult or impossible to predict accurately and most of which are beyond our control. The projections reflect assumptions as to certain business decisions that are subject to change. In addition, the projections may be affected by our ability to achieve strategic goals, objectives and targets over the applicable periods. For example, all of the projections assume a basic level of stability in our business, including assumptions that:

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Our projections were made with the knowledge that one or more of these and other simplifying assumptions may prove to be inaccurate or unrealistic, given the large number and breadth of the assumptions, the uncertainty of the current state of affairs in these areas and the high probability that significant, unanticipated events may result in material changes to the outcomes reflected in the projections.

Accordingly, there can be no assurance that the projections will be realized, and actual results may vary materially from those shown. The inclusion of the projections should not be regarded as an indication that we or any of our directors, officers, employees, advisors, agents or representatives considered or consider the projections to be predictive of actual future events, and the projections should not be relied upon as such. Neither we nor any of our directors, officers, employees, advisors, agents or representatives can give any assurance that actual results will not differ materially from the projections, and neither we nor any of them undertakes any obligation to update or otherwise revise or reconcile the projections to reflect circumstances existing after the date the projections were generated or to reflect the occurrence of future events, even in the event that any or all of the assumptions underlying the projections are shown to be incorrect. We do not intend to make publicly available any update or other revision to the projections, except as otherwise required by law. Neither we nor any of our directors, officers, employees, advisors, agents or representatives has made or makes any representation to any of our stockholders or any other person regarding our ultimate performance compared to the information contained in the projections or that the projections will be achieved. We have made no representation to Linden, Buyer, the Merger Subsidiary or any of their respective affiliates, in the merger agreement or otherwise, concerning the projections.

In light of the foregoing factors and the uncertainties inherent in the projections, stockholders are cautioned not to place undue, if any, reliance on the projections.

The following is a summary of the projections:

High Case

		Fiscal Year Ending September 30,
		2012E		2013E		2014E		2015E		2016E
		(in millions)
Revenue:
Diagnostic & biopharma products		$	38.8			$	43.5			$	49.4			$	55.8			$	62.8
BioServices			12.0				13.8				15.7				17.7				19.9
Total revenue		$	50.9			$	57.3			$	65.1			$	73.5			$	82.7
Gross profit:
Diagnostic & biopharma products		$	20.1			$	21.8			$	25.2			$	28.9			$	32.9
BioServices			2.1				2.6				3.3				3.9				4.8
Total gross profit			22.2				24.4				28.5				32.8				37.7
Operating expenses:
Selling, general & administrative			13.9				15.3				15.7				16.6				17.5
Research & development			1.6				1.5				1.7				1.9				2.0
Total operating expenses			15.6				16.8				17.4				18.4				19.5
Operating income		$	6.6			$	7.7			$	11.0			$	14.4			$	18.2
Adjusted EBITDA		$	9.1			$	10.6			$	14.1			$	17.6			$	21.4

Due to rounding, totals may not equal the sum of the line items in the above table.

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In addition to those set forth above, the key assumptions underlying the high case of the projections include assumptions that:

Middle Case

		Fiscal Year Ending September 30,
		2012E		2013E		2014E		2015E		2016E
		(in millions)
Revenue:
Diagnostic & biopharma products		$	36.5			$	40.1			$	45.0			$	50.6			$	57.0
BioServices			11.5				13.6				15.4				17.3				19.5
Total revenue		$	48.0			$	53.7			$	60.4			$	67.9			$	76.5
Gross profit:
Diagnostic & biopharma products		$	18.7			$	20.1			$	22.9			$	26.2			$	29.9
BioServices			1.9				2.6				3.2				3.9				4.7
Total gross profit			20.6				22.7				26.1				30.0				34.6
Operating expenses:
Selling, general & administrative			13.7				14.7				15.5				16.4				17.3
Research & development			1.6				1.5				1.7				1.9				2.0
Total operating expenses			15.4				16.2				17.2				18.2				19.3
Operating income		$	5.2			$	6.5			$	8.9			$	11.8			$	15.3
Adjusted EBITDA		$	7.7			$	9.3			$	11.8			$	14.7			$	18.3

Due to rounding, totals may not equal the sum of the line items in the above table.

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The key assumptions underlying the middle case of the projections differ from those set forth above for the high case of the projections insofar as we assume that:

Low Case

		Fiscal Year Ending September 30,
		2012E		2013E		2014E		2015E		2016E
		(in millions)
Revenue:
Diagnostic & biopharma products		$	34.5			$	35.1			$	36.9			$	38.8			$	40.7
BioServices			11.3				12.1				12.7				13.4				14.0
Total revenue		$	45.8			$	47.3			$	49.6			$	52.1			$	54.7
Gross profit:
Diagnostic & biopharma products		$	17.4			$	17.1			$	18.2			$	19.2			$	20.3
BioServices			1.8				2.0				2.3				2.4				2.7
Total gross profit			19.2				19.2				20.4				21.6				22.9
Operating expenses:
Selling, general & administrative			13.1				13.7				14.2				14.6				15.1
Research & development			1.6				1.5				1.7				1.9				2.0
Total operating expenses			14.8				15.2				15.9				16.5				17.1
Operating income		$	4.5			$	4.0			$	4.5			$	5.1			$	5.9
Adjusted EBITDA		$	7.0			$	6.8			$	7.4			$	8.0			$	8.9

Due to rounding, totals may not equal the sum of the line items in the above table.

The key assumptions underlying the low case of the projections differ from those underlying the high case and the middle case of the projections insofar as we assume that:

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We did not provide Lazard, Linden or any other potential buyer with projections of our free cash flow. However, at the request of Lazard in order to facilitate its discounted cash flow analysis described above under “The Merger — Opinion of SeraCare’s Financial Advisor — Discounted Cash Flow Analysis” beginning on page 42 of this proxy statement, we confirmed the following assumptions:

Adjusted EBITDA is a non-GAAP financial measure that we define as net income, excluding depreciation and amortization, interest expense, reorganization items, provision for (benefit from) income taxes and non-cash share-based compensation expense. In these projections, we have included forecasts for Adjusted EBITDA solely because they were included in the projections that we provided to Lazard. We provided similar Adjusted EBITDA information for fiscal 2012 through fiscal 2014 to Linden and certain other potential buyers, although that information also excluded estimates of the expenses we expect to incur as a result of being a public company. We included Adjusted EBITDA in the projections we provided to certain potential buyers because we believed that it is one of the financial metrics commonly used by some buyers to evaluate pricing in a potential acquisition transaction. However, Adjusted EBITDA has significant limitations as an analytical tool, should not be considered in isolation and should not be considered as a substitute for GAAP measures. Among other limitations, in considering Adjusted EBITDA in connection with the projections, you should understand that Adjusted EBITDA does not include interest expenses or taxes. Interest expense or the cash requirements necessary to service interest or principal payments on existing indebtedness or indebtedness that we may incur in the future may have a significant impact on our future net income and future cash flows. Similarly, future tax payments may represent a significant use of our cash and may significantly affect our future net income. A reconciliation of Adjusted EBITDA to net income, the most directly comparable GAAP financial measure, is set forth below. In analyzing this reconciliation, you should consider that we have made assumptions regarding our interest expense and future taxes. Our projections of our future interest expense assume that interest rates will continue at their current levels for the foreseeable future and that our level of indebtedness will not change. Similarly, for purposes of projecting our future taxes, we have assumed that the effective tax rates applicable to us in the jurisdictions where we are subject to taxation will remain at their current levels. Due to the speculative nature of these assumptions, you should not unduly rely on Adjusted EBITDA in evaluating the projections, and should consider Adjusted EBITDA only after considering the potential impact of, and potential variations in, interest expense and tax payments in the future.

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		Fiscal Year Ending September 30,
		2012E		2013E		2014E		2015E		2016E
		(in millions)
High Case:
Adjusted EBITDA		$	9.1			$	10.6			$	14.1			$	17.6			$	21.4
Depreciation and amortization			1.4				1.4				1.5				1.6				1.5
Interest expense			0.1				0.1				0.1				0.1				0.1
Reorganization items (1)			0.8				—				—				—				—
Provision for (benefit from) income taxes			(14.9	)			3.0				4.4				4.5				5.7
Non-cash share-based compensation expense			1.1				1.5				1.6				1.6				1.7
Net income		$	20.6			$	4.5			$	6.6			$	9.7			$	12.4
Middle Case:
Adjusted EBITDA		$	7.7			$	9.3			$	11.8			$	14.7			$	18.3
Depreciation and amortization			1.4				1.2				1.3				1.3				1.3
Interest expense			0.1				0.1				0.1				0.1				0.1
Reorganization items (1)			0.8				—				—				—				—
Provision for (benefit from) income taxes			(14.9	)			2.6				3.5				4.5				5.7
Non-cash share-based compensation expense			1.1				1.5				1.6				1.6				1.7
Net income		$	19.2			$	3.9			$	5.3			$	7.2			$	9.5
Low Case:
Adjusted EBITDA		$	7.0			$	6.8			$	7.4			$	8.0			$	8.9
Depreciation and amortization			1.4				1.2				1.3				1.3				1.3
Interest expense			0.1				0.1				0.1				0.1				0.1
Reorganization items (1)			0.8				—				—				—				—
Provision for (benefit from) income taxes			(14.9	)			1.6				1.8				2.0				2.3
Non-cash share-based compensation expense			1.1				1.5				1.6				1.6				1.7
Net income		$	18.4			$	2.4			$	2.7			$	3.0			$	3.5

Due to rounding, totals may not equal the sum of the line items in the above table.

The projections should be evaluated, if at all, in conjunction with our historical financial statements and other information regarding us contained elsewhere in this proxy statement and our public filings with the Securities and Exchange Commission.

Financing of the Merger

The merger is not conditioned on Buyer’s ability to obtain financing. Pursuant to a financing commitment, Linden Capital Partners II LP and Linden Capital Partners II-A LP, which we refer to collectively as the sponsors, have committed to invest, directly or indirectly, at or immediately prior to the effective time of the merger, $82.0 million in Buyer or the Merger Subsidiary, solely for the purpose of (i) funding the consideration payable in the merger and (ii) paying all related fees and expenses pursuant to, and in accordance with, the merger agreement. The aggregate proceeds from the financing commitment are expected to be sufficient for Buyer to finance the merger. The sponsors have also agreed to guarantee certain obligations of Buyer and the Merger Subsidiary under the merger agreement, on the terms and subject to the conditions set forth in a sponsor guarantee in favor of us, including the payment of any reverse termination fee and specified costs and expenses that may become payable to us by Buyer.

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Delisting and Deregistration of SeraCare Common Stock

If the merger is completed, our common stock will be removed from listing on The NASDAQ Capital Market and deregistered under the Securities Exchange Act of 1934, as amended, and we will no longer file periodic reports with the SEC.

Interests of Our Directors and Executive Officers in the Merger

In considering the recommendation of our board of directors with respect to the merger agreement, holders of shares of our common stock should be aware that our directors and executive officers have interests in the merger that may be different from, or in addition to, those of our stockholders generally. These interests may create potential conflicts of interest. Our board of directors was aware that these interests existed when it approved the merger and the merger agreement. The material interests are summarized below.

Common Stock, Stock Options and Restricted Stock to be Cashed Out in the Merger

The following table provides the cash proceeds that each of our current directors and named executive officers, as well as some of our former directors and executive officers, are expected to receive at the closing of the merger from:

in each case, based on his or her beneficial ownership as of February 23, 2012. For purposes of this table, we assume that the merger will occur on the date of the special meeting. The amounts in the table do not reflect any taxes that will be incurred upon the conversion of shares into the merger consideration or the cash-out of options.

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Value of Equity Securities
(estimated as of the date of the special meeting)

		Value of Vested and Unrestricted SeraCare Equity		Value of SeraCare Equity That Will Vest Upon the Merger		Total Cash Payment for Equity Securities ($)
Name		Common stock ($)		Stock options ($)		Subtotal ($)		Restricted stock ($)		Stock options ($)		Subtotal ($)
Named Executive Officers:
Gregory A. Gould		$	285,852			$	252,916			$	538,768			$	670,000			$	23,334			$	693,334			$	1,232,102
Ronald R. Dilling			68,140				102,500				170,640				293,800				10,000				303,800				474,440
Kathryn E. Shea			55,012				75,000				130,012				223,000				10,000				233,000				363,012
John J. (Sean) O’Connor II			—				—				—				360,000				—				360,000				360,000
Susan L.N. Vogt (1)			1,658,720				—				1,658,720				—				—				—				1,658,720
William J. Smutny (2)			44,664				—				44,664				—				—				—				44,664
Non-employee Directors:
Joseph M. Nemmers, Jr.			32,156				9,779				41,935				—				23,813				23,813				65,747
E. Kevin Hrusovsky			10,956				5,867				16,823				—				14,288				14,288				31,111
Sarah L. Murphy			97,580				63,113				160,693				—				14,288				14,288				174,980
Jill Tillman			94,436				63,113				157,549				—				14,288				14,288				171,836
Samuel D. Anderson (3)			976,824				58,350				1,035,174				—				—				—				1,035,174
Harold S. Blue (3)							2,100				2,100				—				—				—
Eugene I. Davis (3)			3,744				3,500				3,500				—				—				—				7,244
All current directors and executive officers as a group (8 persons)		$	2,302,852			$	572,287			$	2,875,139			$	1,546,800			$	110,900			$	1,656,809			$	4,531,948

Due to rounding, totals may not equal the sum of the line items in the above table.

Employment-Related Provisions of the Merger Agreement

The merger agreement provides that Buyer will provide our continuing employees (including our executive officers) with certain benefits following the closing of the merger. See “The Merger Agreement —  Employee Benefit Matters” beginning on page 71 of this proxy statement

Information About Golden Parachute Compensation

We have several plans and agreements that provide for amounts to be paid to our named executive officers or for the accelerated vesting of equity awards held by our named executive officers in connection with a change in control. The merger will constitute a change in control under each of these plans and agreements. We describe each of these plans and agreements below and quantify the amounts that will be payable to our named executive officers and the value of any equity awards held by our named executive officers for which vesting will be accelerated in connection with the merger, assuming the merger is completed and, in the case of Mr. Gould, assuming that his employment with us is terminated upon the consummation of the merger.

Equity Incentive Plans .  We currently have two equity compensation plans, our 2001 Stock Incentive Plan and our 2009 Equity Incentive Plan. In the event of a change in control, our 2001 Stock Incentive Plan and our 2009 Equity Incentive Plan generally provide that all unvested stock options and unvested shares of restricted stock will become fully vested. Under the terms of the merger agreement, all stock options, whether vested or not, including options held by our named executive officers, that are outstanding and unexercised immediately prior to the effective time of the merger will be canceled and automatically converted into the

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right to receive an amount in cash, without interest, equal to the product of (i) the total number of shares of common stock otherwise issuable upon exercise of such option and (ii) the merger consideration less the exercise price per share of the stock option and less applicable withholding taxes.

Severance Payments to Mr. Gould .  On August 16, 2006, we entered into an employment agreement with Mr. Gould. We amended and restated the agreement on November 18, 2009. Under the terms of the employment agreement, if Mr. Gould’s employment is terminated by us without cause or by Mr. Gould for good reason (as such terms are defined below), then, subject to Mr. Gould’s delivery of a release of claims in our favor, Mr. Gould will be entitled to a severance benefit equal to (i) 100% of his base salary at the annualized rate in effect on his severance date, (ii) a pro-rated amount of his incentive bonus for the year in which his severance date occurs, (iii) the cost of COBRA premiums for continued medical insurance coverage for Mr. Gould and his dependents until the first anniversary of his severance date (or, earlier, as described in more detail below), (iv) immediately prior to his severance date, full vesting of all stock options and other equity or equity-related compensation or grants that vest based on the passage of time and continued performance of services (excluding any grants that include performance-based vesting criteria) and (v) reimbursement, in an amount not to exceed $36,000, for executive outplacement services, if any, received by Mr. Gould. If we terminate Mr. Gould’s employment without cause or Mr. Gould terminates his employment for good reason in connection with or following a change in control, Mr. Gould will receive the severance benefits outlined above except that the amount paid pursuant to clause (i) above would be equal to 150%, rather than 100%, of his base salary at the annualized rate in effect on his severance date and the amount otherwise payable pursuant to clause (ii) above would be increased by 150% of his target incentive bonus for the year in which the severance occurs. The severance benefits determined pursuant to clauses (i) and (ii) above would be payable in a single lump sum not later than 30 days after Mr. Gould’s termination of employment.

Mr. Gould’s employment agreement also provides that, if Mr. Gould is entitled to any payments under the employment agreement or any other plan, program or arrangement in which he participates that would constitute an “excess parachute payment” subject to the excise tax imposed by Section 4999 of the Internal Revenue Code, and the amount of the parachute payment payable to Mr. Gould is more than 110% of the threshold at which such amount becomes an excess parachute payment, then we must pay Mr. Gould an additional amount so that the net amount retained by him will be equal to the amount of such parachute payment before the imposition of such excise tax. The agreement also provides that, if the total amount of payments to Mr. Gould is less than 110% of the threshold at which such amount becomes an excess parachute payment, then the amount of the payments will be reduced by the amount of the excess so that no such excise tax will be incurred.

Mr. Gould’s right to reimbursement for COBRA premiums will end on the earliest of his death, the date he becomes eligible for coverage under the health plan of another employer, the date we cease to offer group medical coverage to our active executive employees or the date we are no longer otherwise obligated to offer COBRA continuation coverage.

In addition, as a condition of his employment, Mr. Gould entered into a confidentiality agreement and a non-competition agreement with us pursuant to which he agreed not to compete with us or solicit our customers or employees for a period of one year after the termination of his employment. If Mr. Gould materially breaches any of his obligations under his confidentiality agreement or non-competition agreement at any time, he will no longer be entitled to receive any of his severance payments payable therafter. The term of Mr. Gould’s confidentiality agreement and non-competition agreement is generally the term of his employment plus a period of one year thereafter. The provisions of Mr. Gould’s confidentiality and non-competition agreements may be waived by a written instrument signed by the party waiving compliance.

As used in Mr. Gould’s employment agreement, cause means:

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As used in Mr. Gould’s employment agreement, good reason means the occurrence of any of the following:

Aggregate Amounts of Potential Compensation.   The following table provides information regarding the aggregate dollar value of the various elements of compensation that could be received by the named executive officers that is based on or otherwise relates to the merger. The descriptions and quantifications of the payments in the table are intended to comply with Item 402(t) of Regulation S-K promulgated by the SEC, which requires disclosure of information about compensation and benefits that each of the named executive officers will or may receive in connection with the merger. This compensation is referred to as “golden parachute” compensation by applicable SEC disclosure rules and is subject to a non-binding, advisory vote of our stockholders, as described below in the section entitled “Compensation Arrangements for our Named Executive Officers in Connection with the Merger” beginning on page 92 of this proxy statement, In preparing the table, we have made the following assumptions:

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In addition to the above assumptions, the costs of COBRA premiums for continued medical insurance coverage for Mr. Gould and his dependents and the calculation of potential tax reimbursements to Mr. Gould are based on estimates that we believe to be reasonable. Any changes in these estimates would affect the amounts shown in the following table. The actual amount of Mr. Gould’s incentive bonus amount will be based upon an extrapolation, over the fiscal year ending September 30, 2012, of our financial performance through the date of the termination of his employment. Under the terms of our management incentive plan, Mr. Gould’s maximum incentive bonus for the fiscal year ending September 30, 2012 is equal to 150% of his target bonus amount. Mr. Gould’s target bonus amount is equal to 75% of his base salary. Although Linden has expressed its present intention to terminate Mr. Gould’s employment effective as of the closing of the merger, it has no obligation to do so, and any delay in the termination of Mr. Gould’s employment could affect the amount of any golden parachute compensation he will receive.

Golden Parachute Compensation

Name (1)		Cash ($)		Equity ($) (2)		Pension/ NQDC ($) (3)		Perquisites/ Benefits ($)		Tax Reimbursement ($)		Other ($)		Total ($)
Gregory A. Gould		$	1,124,716	(4)		$	693,334				—			$	55,158	(5)		$	642,046	(6)			—			$	2,515,254
Ronald R. Dilling			—				303,800				—				—				—				—				303,800
Kathryn E. Shea			—				233,000				—				—				—				—				233,000
John J. (Sean) O’Connor II			—				360,000				—				—				—				—				360,000

Due to rounding, totals may not equal the sum of the line items in the above table.

		Value of SeraCare Equity That Will Vest Upon the Merger
Name		Restricted stock ($)		Stock options ($)
Gregory A. Gould		$	670,000			$	23,334
Ronald R. Dilling			293,800				10,000
Kathryn E. Shea			223,000				10,000
John J. (Sean) O’Connor II			360,000				—

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Director and Officer Indemnification and Insurance

We have entered into indemnification agreements with each of our directors and with Mr. Gould, our Interim President and Chief Executive Officer and Chief Financial Officer. Pursuant to these agreements and subject to the procedures set forth in them, we have agreed: (i) to indemnify the director or officer in connection with any action, suit, arbitration, alternative dispute resolution proceeding, administrative hearing or other proceeding arising after the date of the agreement as to which the director or officer is, was or is threatened to be made a party (or is otherwise involved) by reason of such director’s or officer’s status as a director or officer of our company or in certain other capacities, to the fullest extent permitted by law; (ii) that if requested by the director or officer, and subject to specified exceptions, we will advance expenses to the director or officer in connection with any such proceeding; (iii) that if we undergo a change in control, including the change in control that will result from the consummation of the merger, upon the director’s or officer’s written election, we will seek the advice of independent legal counsel with respect to whether such director or officer has met the applicable standard of conduct to be entitled to indemnification under the indemnification agreement and such director’s or officer’s right to advancement of expenses; and (iv) that the rights of the director or officer under the indemnification agreement are in addition to any other rights the director or officer may have under our certificate of incorporation or by-laws or the DGCL or otherwise. In addition, each indemnification agreement establishes procedures regarding the defense and settlement of claims by the parties, the relevant burden of proof and the period of limitations.

For a period of six years after the effective time of the merger, Buyer and the surviving corporation are required to fulfill and honor in all respects all of our obligations arising under our certificate of incorporation and by-laws and under any indemnification or other similar agreements, including the indemnification agreement described above, between us and our current and former directors and officers (whom we refer to as indemnified parties) in effect on the date of the merger agreement.

Prior to the effective time of the merger, we will purchase one or more six-year “tail” policies on our directors’ and officers’ liability insurance policies in effect on the date of the merger agreement or comparable coverage in respect of actions or omissions occurring prior to the effective time of the merger. Our cost in obtaining these policies may not exceed 300% of our current annual premium for such insurance. The surviving corporation will (and Buyer will cause the surviving corporation to) maintain such “tail” policies in full force and effect and continue to honor their respective obligations under the policies for a period of six years after the effective time of the merger.

If Buyer, the surviving corporation or any of their respective successors or assigns consolidates with or merges into any other person and is not the continuing or surviving entity of such consolidation or merger, or transfers or conveys all or substantially all of its properties and assets to any person, then the merger agreement requires that proper provision be made so that the successors and assigns of Buyer or the surviving corporation will assume all of the applicable obligations described above. The indemnified parties are intended third-party beneficiaries of the indemnification and insurance provisions in the merger agreement.

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REGULATORY MATTERS

Mergers and acquisitions that may have an impact in the United States are subject to review by the Department of Justice and the Federal Trade Commission to determine whether they comply with applicable antitrust laws. Under the HSR Act, mergers and acquisitions that meet certain jurisdictional thresholds may not be completed until the expiration of a waiting period that follows the filing of notification forms by both parties to the transaction with the Department of Justice and the Federal Trade Commission. We and Buyer have determined that the merger does not meet the jurisdictional thresholds of the HSR Act. As a result, neither Buyer nor we are required to file notification forms with the Department of Justice or the Federal Trade Commission, and no waiting period will apply to the merger as a consequence of the HSR Act. See “The Merger Agreement — Conditions to the Merger” beginning on page 80 of this proxy statement.

LITIGATION RELATED TO THE MERGER

We are aware of two purported class action complaints that have been filed in the Delaware Court of Chancery, New Castle County, in connection with the merger: Kishore v. Nemmers, et. al. , No. 7250, filed on February 15, 2012, and Hackenburg, et.al. v. SeraCare Life Sciences, Inc., et al. , No. 7254, filed on February 17, 2012. Each complaint names as defendants us, each member of our board of directors, Buyer and the Merger Subsidiary. The Kishore complaint also names Linden as a defendant. The complaints allege that the board of directors breached its fiduciary duties, and that we, Buyer, the Merger Subsidiary and, in the case of the Kishore complaint, Linden aided and abetted those purported breaches, in connection with the proposed merger. The complaints challenge the merger consideration as inadequate, and make a variety of other allegations, including the following:

The plaintiffs in these cases seek orders certifying a proposed class of stockholders, certifying the respective plaintiffs as the class representative, granting injunctive relief against the consummation of the merger, or, if the merger is consummated, rescinding the merger and awarding damages, directing the defendants to account for all damages caused by them and all profits or special benefits obtained by them as a result of their breaches of fiduciary duties and an award of costs and attorneys’ fees.

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MATERIAL UNITED STATES FEDERAL INCOME TAX CONSEQUENCES

The following summary is a general discussion of the material United States federal income tax consequences to our stockholders whose shares of our common stock are converted into cash pursuant to the merger. This summary is based upon the provisions of the Internal Revenue Code of 1986, as amended, or the Code, applicable United States Treasury Regulations, judicial authority, and administrative rulings and practice, all as in effect on the date of this proxy statement. All of these authorities are subject to change, possibly on a retroactive basis. No ruling from the Internal Revenue Service has been or will be sought with respect to any aspect of the merger.

This summary is for the general information of our stockholders only and does not purport to be a complete analysis of all potential tax effects of the merger. It addresses only stockholders who hold our common stock as a capital asset within the meaning of Section 1221 of the Code (generally, property held for investment), and does not address any tax consequences to holders of stock options or holders of restricted stock. The summary does not address any state, local or foreign income tax consequences of the merger, nor does it address any non-income tax laws. This summary does not address all aspects of United States federal income taxation that may be relevant to a particular stockholder in light of the stockholder’s personal investment circumstances. The summary also does not address all aspects of United States federal income taxation that may be relevant to particular stockholders that are subject to special treatment under United States federal income tax laws, including, without limitation:

If a partnership (or an entity or arrangement treated as a partnership for United States federal income tax purposes) holds shares of our common stock, the tax treatment of a partner generally will depend on the status of the partner and the activities of the partnership. Partners of partnerships holding our common stock should consult their own tax advisors regarding the tax consequences of the merger.

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For purposes of this summary, “U.S. holder” refers to a beneficial owner of our common stock that is, for United States federal income tax purposes:

A “non-U.S. holder” is a beneficial owner of our common stock that is an individual, corporation, trust or estate that, in each case, is not a U.S. holder.

Stockholders are advised to consult their own tax advisors regarding the United States federal income tax consequences of the merger in light of their personal circumstances, as well as any tax consequences arising under any federal non-income tax laws and under any state, local and foreign tax laws.

U.S. Holders

The receipt of cash in exchange for shares of our common stock pursuant to the merger will be a taxable transaction to U.S. holders. Generally, this means that each U.S. holder will recognize capital gain or loss equal to the difference between the amount of cash received by such U.S. holder in the merger and the U.S. holder’s adjusted tax basis in its shares of our common stock. Gain or loss will be determined separately for each block of shares (i.e., shares acquired at the same cost in a single transaction) owned by a U.S. holder. If the shares of our common stock have been held for more than one year at the effective time of the merger, the gain or loss will be long-term capital gain or loss, and will be short-term capital gain or loss if the shares have been held for one year or less. For non-corporate taxpayers, long-term capital gains generally are taxable at a reduced rate and short-term capital gains are taxed at ordinary income tax rates. The deductibility of capital losses is subject to certain limitations.

Information returns will be filed with the Internal Revenue Service in connection with payments to a U.S. holder pursuant to the merger, unless the U.S. holder is an exempt recipient. Under the United States federal income tax backup withholding rules, the exchange agent to be appointed by Buyer for the purpose of paying the merger consideration generally will be required to withhold 28% of all payments to which a U.S. holder is entitled in the merger, unless the U.S. holder (i) is a corporation or comes within other exempt categories and demonstrates this fact in a manner satisfactory to the exchange agent or (ii) provides its correct tax identification number (social security number, in the case of an individual, or employer identification number in the case of other stockholders), certifies under penalties of perjury that the number is correct, certifies as to no loss of exemption from backup withholding and otherwise complies with the applicable requirements of the backup withholding rules. To avoid such backup withholding, each U.S. holder and, if applicable, each other payee, should complete, sign and return to the exchange agent the substitute Form W-9 that such U.S. holder will receive with the letter of transmittal following completion of the merger. Backup withholding is not an additional tax. Any amounts withheld under the backup withholding rules will be credited against a U.S. holder’s United States federal income tax liability, and the U.S. holder may obtain a refund of any amounts withheld in excess of its United States federal income tax liability, provided that the required information is timely furnished to the Internal Revenue Service.

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Non-U.S. Holders

Any gain realized on the receipt of cash pursuant to the merger by a non-U.S. holder generally will not be subject to United States federal income tax unless:

A non-U.S. holder will be subject to information reporting and, in certain circumstances, backup withholding (at a rate of 28%) may apply to the cash received pursuant to the merger, unless the non-U.S. holder certifies under penalties of perjury that it is a non-U.S. holder. To avoid backup withholding, non-U.S. holders generally must submit a completed and signed Form W-8BEN, “Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding,” or other applicable Form W-8. Backup withholding is not an additional tax. Any amounts withheld under the backup withholding rules will be credited against a non-U.S. holder’s United States federal income tax liability, and the non-U.S. holder may obtain a refund of any amounts withheld in excess of its United States federal income tax liability, provided that the required information is timely furnished to the Internal Revenue Service.

THE FOREGOING DISCUSSION OF MATERIAL UNITED STATES FEDERAL INCOME TAX CONSEQUENCES IS NOT INTENDED TO BE, AND SHOULD NOT BE CONSTRUED AS, LEGAL OR TAX ADVICE TO ANY HOLDER OF SHARES OF OUR COMMON STOCK. EACH OF OUR STOCKHOLDERS IS STRONGLY URGED TO CONSULT HIS, HER OR ITS TAX ADVISOR TO DETERMINE THE PARTICULAR TAX CONSEQUENCES (INCLUDING THE APPLICATION AND EFFECT OF ANY STATE, LOCAL OR FOREIGN INCOME AND OTHER TAX LAWS) TO SUCH STOCKHOLDER OF THE RECEIPT OF CASH IN EXCHANGE FOR SHARES OF OUR COMMON STOCK PURSUANT TO THE MERGER.

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THE MERGER AGREEMENT

The following is a summary of the material terms and conditions of the merger agreement. The description in this section and elsewhere in this proxy statement is qualified in its entirety by reference to the complete text of the Agreement and Plan of Merger, dated as of February 12, 2012, and Amendment No. 1 to Agreement and Plan of Merger, dated as of February 27, 2012, copies of which are attached as Annex A-1 and Annex A-2, respectively, and are incorporated by reference into this proxy statement. This summary does not purport to be complete and may not contain all of the information about the merger agreement that is important to you. We encourage you to read the merger agreement carefully and in its entirety because it is the legal document that governs this merger.

Explanatory Note Regarding the Merger Agreement

The merger agreement and this summary of its terms and provisions have been included to provide you with information regarding the terms and provisions of the merger agreement. Factual disclosures about us, Buyer or the Merger Subsidiary contained in this proxy statement or in our public reports filed with the SEC, which are available without charge at www.sec.gov , may supplement, update or modify the factual disclosures about us, Buyer or the Merger Subsidiary contained in the merger agreement. In your review of the representations and warranties contained in the merger agreement and described in this summary, it is important to bear in mind that the representations and warranties have been negotiated with the principal purpose of establishing the circumstances in which a party to the merger agreement may have the right not to close the merger if the representations and warranties of the other party prove to be untrue due to a change in circumstance or otherwise, and allocates risk between the parties to the merger agreement, rather than establishing matters as facts. The representations and warranties may also be subject to a contractual standard of materiality different from those generally applicable to stockholders and in some cases have been qualified in a number of important respects, including through the use of negotiated exceptions for certain matters disclosed by each party to the other parties.

The Merger

The merger agreement provides that, in accordance with the merger agreement and the General Corporation Law of the State of Delaware, which we refer to as the DGCL, at the effective time of the merger, the Merger Subsidiary will be merged with and into us and, as a result of the merger, the separate existence of the Merger Subsidiary will cease and we will continue as the surviving corporation and become a wholly owned subsidiary of the Buyer. At the effective time of the merger, all of our and the Merger Subsidiary’s properties, rights, privileges, powers and franchises will vest in us as the surviving corporation and all of our and the Merger Subsidiary’s debts, liabilities and duties will become our debts, liabilities and duties as the surviving corporation.

At the effective time of the merger, our certificate of incorporation will be amended in its entirety as provided in the merger agreement, and as so amended, will be the certificate of incorporation of the surviving corporation until amended as provided by the certificate of incorporation or under the DGCL. On February 27, 2012, the parties to the original merger agreement entered into an amendment of the original merger agreement for the purpose of amending and restating the certificate of incorporation of the surviving corporation to substantially conform the indemnification and advancement of expenses provisions in the certificate of incorporation of the surviving corporation to those included in our certificate of incorporation immediately prior to the merger. The by-laws of the Merger Subsidiary, as in effect immediately prior to the effective time of the merger, will be the by-laws of the surviving corporation until amended as provided by the by-laws or under the DGCL. The directors of the Merger Subsidiary immediately prior to the effective time of the merger will be the initial directors of the surviving corporation following the effective time of the merger until the earliest of their resignation, removal or death or their respective successors are duly elected or appointed and qualified, as the case may be. The officers of the Merger Subsidiary immediately prior to the effective time of the merger will be the initial officers of the surviving corporation following the effective time of the merger until the earliest of their resignation, removal or death or their respective successors are duly elected or appointed and qualified, as the case may be.

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The closing of the merger will occur on a date to be specified by the parties, which will be no later than the second business day after the satisfaction or, to the extent permitted by law, waiver of the closing conditions stated in the merger agreement and described under “— Conditions to the Merger” beginning on page 80 of this proxy statement (other than those conditions that by their nature are to be satisfied at the closing, but subject to the fulfillment or, to the extent permitted by law, waiver of such conditions) or as otherwise agreed by the parties.

At the closing of the merger, the parties will cause the merger to be consummated by filing a certificate of merger with the Secretary of State of the State of Delaware. The merger will be effective at the time the certificate of merger is duly filed with the Secretary of State of the State of Delaware (or at such later time as is agreed upon by the parties to the merger agreement and specified in the certificate of merger), which we refer to as the effective time of the merger. It is currently anticipated that the effective time of the merger will occur in the second calendar quarter of 2012. However, the parties cannot predict the exact timing of the closing of the merger or whether the merger will be completed at an earlier or later time, as agreed by the parties, or at all.

The Merger Consideration

At the effective time of the merger, by virtue of the merger and without any action on the part of Buyer, the Merger Subsidiary, us or any holder of shares of our common stock, each share of our common stock issued and outstanding immediately prior to the effective time of the merger will be canceled and converted automatically into the right to receive $4.00 in cash, without interest, which we refer to as the merger consideration, upon surrender of the shares in accordance with the merger agreement, other than:

At the effective time of the merger, each share of common stock of the Merger Subsidiary outstanding immediately prior to the effective time of the merger will be converted into and become one fully paid and nonassessable share of common stock, par value $0.01 per share, of the surviving corporation.

Payment Procedures

Prior to the effective time of the merger, Buyer will appoint a bank or trust company reasonably acceptable to us to act as an exchange agent, which shall provide for the payment of the merger consideration. As of the effective time of the merger, the Buyer is required to deposit, or to take all steps necessary to enable and cause the surviving corporation to deposit, with the exchange agent the cash necessary to pay for the shares of our common stock converted into the right to receive merger consideration.

Within three business days of the effective time of the merger, the exchange agent will mail to each holder of shares of our common stock that were converted into the right to receive the merger consideration, a letter of transmittal and instructions for use in surrendering stock certificates or transferring uncertificated shares in exchange for the merger consideration. No stockholder should surrender any stock certificates until the stockholder receives the letter of transmittal and other materials for such surrender. Upon surrender of a stock certificate representing shares of our common stock for cancellation to the exchange agent, together with a duly executed letter of transmittal and such other documents as may reasonably be required by the exchange agent, or receipt of an “agent’s message” by the exchange agent (or such other evidence, if any, of transfer as the exchange agent may reasonably request), in the case of a book-entry transfer of uncertificated shares of our common stock, the holder of such certificate or uncertificated shares will be entitled to receive the merger consideration into which the shares of our common stock previously represented by such stock certificate or uncertificated shares have been converted pursuant to the merger agreement. Each of Buyer, the Merger Subsidiary, the surviving corporation, the exchange agent and us will

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be entitled to deduct and withhold from the merger consideration such amounts as may be required to be deducted or withheld under applicable tax laws. The cash paid to you upon surrender of your shares of our common stock will be issued in full satisfaction of all rights relating to your shares of our common stock.

If any portion of the merger consideration is to be paid to a person other than the person in whose name the surrendered stock certificate or the transferred uncertificated share is registered, it will be a condition to such delivery that such stock certificate will be properly endorsed or will otherwise be in proper form for transfer or such uncertificated share will be properly transferred and that the person requesting such payment will pay any transfer or other tax required as a result of such payment to a person other than the registered holder of such stock certificate or uncertificated share or establish to the satisfaction of Buyer that such taxes have been paid or are not applicable.

After the effective time of the merger, there will be no further registration of transfers of shares of our common stock. If, after the effective time of the merger, stock certificates or uncertificated shares of our common stock are presented to the surviving corporation or the exchange agent, they will be canceled and exchanged for the merger consideration, except as otherwise provided by law.

If your stock certificate has been lost, stolen or destroyed, the exchange agent will deliver to you the applicable merger consideration for the shares represented by that certificate if:

You should not send your certificates now and should send them only pursuant to instructions set forth in the letters of transmittal to be mailed to stockholders promptly after the completion of the merger. In all cases, the merger consideration will be paid only in accordance with the procedures set forth in the merger agreement and such letters of transmittal.

The merger agreement provides that twelve months after the effective time of the merger, the exchange agent will deliver to Buyer upon its demand any funds made available to the exchange agent that have not been distributed to the former holders of shares of our common stock, and that any holders of stock certificates or uncertificated shares who have not complied with the above-described procedures to receive payment of the merger consideration during such twelve-month period may thereafter look only to Buyer for payment of the merger consideration, without interest, to which they are entitled. None of Buyer, the surviving corporation or the exchange agent will be liable for any amount delivered to a public official pursuant to any applicable abandoned property, escheat or similar law. If any stock certificates or uncertificated shares representing shares of our common stock prior to the effective time of the merger have not been surrendered by the date on which any merger consideration would escheat to or become the property of any governmental authority, then any merger consideration in respect of such stock certificates or uncertificated shares will become the property of the surviving corporation free and clear of all claims or interests of any holders of such stock certificates or uncertificated shares to the extent permitted by law.

Treatment of Options and Restricted Stock Awards; Stock Plans

We have issued options to purchase shares of our common stock under our Amended and Restated 2001 Stock Incentive Plan and our 2009 Equity Incentive Plan (which, together, we refer to as the stock plans). Our board of directors has adopted resolutions providing that each stock option which has not been exercised and has not expired or terminated and remains outstanding immediately prior to the effective time of the merger will be canceled, and the holder of any such option will be entitled to receive an amount in cash, without interest, equal to the product of (i) the total number of shares of our common stock issuable upon exercise of such option and (ii) the merger consideration less the applicable exercise price per share of our common stock otherwise issuable upon exercise of such option, which will be paid to the holder of the option, subject to any required withholding taxes, no later than five business days after the effective time of the merger. No holder

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of an option that has an exercise price per share that is equal to or greater than $4.00 is entitled to any payment with respect to such canceled option before or after the effective time of the merger.

As of the effective time of the merger, each share of common stock issued pursuant to a stock plan that is subject to a risk of forfeiture or a right of repurchase until vested by continued employment or other service to us (which we refer to as restricted stock) that is outstanding and unvested immediately prior to the effective time of the merger will become fully vested and converted into the right to receive an amount in cash equal to the merger consideration, less applicable withholding taxes.

Unless we, Buyer and the Merger Subsidiary agree otherwise, our stock plans will terminate as of the effective time of the merger and the provisions in any other plan, program or arrangement providing for the issuance or grant of any other interest in respect of our capital stock will be canceled.

Representations and Warranties

The merger agreement contains representations and warranties of the parties to the merger agreement. The assertions embodied in those representations and warranties were made solely for purposes of the merger agreement and may be subject to important qualifications and limitations agreed to by the parties in connection with negotiating the terms of the merger agreement. Moreover, these representations and warranties have been qualified by certain disclosures that we made to Buyer and the Merger Subsidiary in connection with the negotiation of the merger agreement, which disclosures are not reflected in the merger agreement. Furthermore, some of those representations and warranties may not be accurate or complete as of any particular date because they are subject to a contractual standard of materiality or material adverse effect different from that generally applicable to public disclosures to stockholders. The representations and warranties were used for the purpose of allocating risk between the parties to the merger agreement rather than establishing matters of fact. For the foregoing reasons, you should not rely on the representations and warranties contained in the merger agreement as statements of factual information. The representations and warranties in the merger agreement and the description of them in this proxy statement should be read in conjunction with the other information contained in our reports, statements and filings that we publicly file with the SEC. This description of the representations and warranties is included to provide our stockholders with additional information regarding the terms of the merger agreement.

In the merger agreement, we made representations and warranties to Buyer and the Merger Subsidiary with respect to, among other things:

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Many of the representations and warranties in the merger agreement made by us are qualified by a “materiality” or a “company material adverse effect” standard (that is, they will not be deemed to be untrue or incorrect unless their failure to be true or correct, individually or in the aggregate, would, as the case may be, be material or have a company material adverse effect on us). For purposes of the merger agreement, a “company material adverse effect” means a material adverse effect on (i) our business, financial condition, assets or results of operations, or (ii) our ability to perform our obligations under the merger agreement or to consummate the merger and the other transactions contemplated by the merger agreement. However, the definition of “company material adverse effect” excludes any effect attributable to:

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In the merger agreement, Buyer and the Merger Subsidiary made representations and warranties to us with respect to, among other things:

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The representations and warranties contained in the merger agreement and in any certificate or other writing delivered pursuant to the merger agreement will not survive the effective time of the merger. This limit does not apply to any covenant or agreement of the parties which by its terms contemplates performance after the effective time of the merger.

Conduct of Our Business Pending the Merger

The merger agreement contains covenants related to the conduct of our business from the date of the merger agreement until the effective time of the merger. These covenants are complicated and not easily summarized. You are urged to read carefully and in its entirety Section 5.1 of the merger agreement entitled “Conduct of Business by the Company Pending the Merger”. Subject to certain exceptions in the merger agreement and disclosure letter delivered by us in connection with the merger agreement, between the date of the merger agreement and the effective time of the merger, unless Buyer gives its prior written consent (which cannot be unreasonably withheld, conditioned or delayed), we have agreed to (i) conduct our business in the ordinary and course of business consistent with past practices and (ii) use our commercially reasonable efforts to maintain and preserve intact our business organization and goodwill, to keep available the services of current officers and employees and to preserve and maintain our beneficial business relationships with suppliers, contractors, distributors, customers, landlords, licensors, licensees and others having material business relationships with us.

In addition, subject to certain exceptions in the merger agreement and disclosure letter delivered by us in connection with the merger agreement, between the date of the merger agreement and the effective time of the merger, unless Buyer gives its prior written consent (which cannot be unreasonably withheld, conditioned or delayed), we have agreed not to:

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Preparation of Proxy Statement; Stockholders Meeting

As promptly as practicable after the date of the merger agreement, we will:

Unless the merger agreement is terminated as described below under “— Termination of the Merger Agreement” beginning on page 82 of this proxy statement, as promptly as practicable following the clearance of the definitive proxy statement by the SEC, we will:

We may not postpone or adjourn the special meeting, except in certain circumstances, without the consent of Buyer, which shall not be unreasonably withheld, conditioned or delayed. Buyer has agreed to cause all shares of our common stock owned by Buyer, the Merger Subsidiary or any other subsidiary of Buyer to be voted in favor of the adoption of the merger agreement.

Employee Benefit Matters

Buyer agrees to honor in accordance with their terms all of our employee benefit plans and all employment and severance agreements, in each case as required by the merger agreement, and all accrued benefits vested under such plans and agreements. However, Buyer or the surviving corporation is not prohibited from amending or terminating any employee benefit plan or other agreement in accordance with its terms and law.

For twelve months following the effective time of the merger, Buyer agrees to provide our employees who were employed by us immediately prior to the effective time of the merger with employee benefits in the aggregate not materially less favorable than those benefits currently provided by us generally to such

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employees (other than equity incentive, change in control or retention arrangements). Buyer will be under no obligation to retain any of our employees other than as required by law or as otherwise agreed to in the merger agreement.

Buyer also has agreed to, among other things, credit our employees for prior service for vesting and eligibility purposes (but not benefit accrual) under any benefit plan of Buyer in which our employees may be eligible to participate after completion of the merger. Buyer will use commercially reasonable efforts to ensure that (i) our employees are given credit for any deductible or co-payment amounts paid in the plan year in which the closing occurs, to the extent that, following the closing, they participate in any other plan for which deductibles or co-payments are required, and (ii) each benefit plan of Buyer in which our employees may participate after the completion of the merger will waive any preexisting condition that was waived under the terms of any of our employee benefit plans immediately prior to the closing or any limitations as to waiting periods, physical examinations or exclusions which would otherwise be applicable to any of our employees. Buyer will also recognize any accrued but unused vacation, sick leave and sabbatical time of our employees as of the effective time of the merger, and for a period of twelve months following the effective time of the merger, Buyer agrees to provide vacation, sick leave and sabbatical time not materially less favorable than the terms of our policies in effect as of the effective time of the merger.

Buyer agrees to cause the surviving corporation to provide any required notice under the WARN Act, and any similar federal, state or local law, and to otherwise comply with the WARN Act and any similar law with respect to any “plant closing” or “mass layoff” (as defined in the WARN Act) or group termination or similar event affecting our employees (including as a result of the consummation of the transactions contemplated by the merger agreement) and occurring from and after the effective time of the merger.

Antitrust Filings

Under the merger agreement, we, Buyer and the Merger Subsidiary agreed to file with the Federal Trade Commission, or FTC, and the Department of Justice, or DOJ, all appropriate filings and submissions required by the United States antitrust laws and any other laws.

Public Statements

Unless our board of directors has effected a change in recommendation, we, Buyer and the Merger Subsidiary will consult with each other prior to issuing, and provide each other with the opportunity to review and comment upon, any public announcement, statement or other disclosure with respect to the merger agreement or the merger and will not issue any public announcement or statement prior to such consultation, except as may be required by law or any rule of or listing agreement with a national securities exchange or trading market so long as the disclosing party has used its commercially reasonable efforts to consult with the other party and to obtain such party’s consent, which shall not be unreasonably withheld, delayed or conditioned, but has been unable to do so prior to the time such public announcement or statement is to be issued or made).

Standard of Efforts; Required Approvals

We, Buyer and the Merger Subsidiary agreed to use our reasonable best efforts to take, or cause to be taken, all action, and to do, or cause to be done, and to assist and cooperate with the other parties in doing, all things necessary, proper or advisable to consummate and make effective in the most expeditious manner practicable, the merger and the other transactions contemplated by the merger agreement, including:

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Unless our board of directors has made a change in recommendation, subject to law and the instructions of any governmental authority, we, Buyer and the Merger Subsidiary agreed to provide the other party and its counsel a reasonable opportunity to review and comment on any material filing or communication made in connection with the merger and the other transactions contemplated by the merger agreement prior to the filing or making thereof and to give reasonable and good faith consideration to any comments made by the other party and its counsel. We, Buyer and the Merger Subsidiary agreed that, unless our board of directors has made a change in recommendation, we will consult with each other with respect to the obtaining of all such necessary consents, approvals, authorizations, actions, non-actions and waivers of all third parties and governmental authorities.

We, Buyer and the Merger Subsidiary each also agreed to:

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We, Buyer and the Merger Subsidiary have agreed to cooperate with each other in any of the measures described in the preceding bullet points, but in no event will any party have any obligation to sell, hold separate or otherwise dispose of, or agree to sell, hold separate or otherwise dispose of or conduct our business in a specified manner, or permit the sale, holding separate or other disposition of, any assets of, ours, Buyer or the Merger Subsidiary, as the case may be, if such divestiture would reasonably be expected to have a material adverse effect on the business, financial condition or results of operations of the combined businesses of Buyer, Buyer’s subsidiaries and us.

Notification of Certain Matters

Buyer and the Merger Subsidiary will give prompt notice to us and, unless our board of directors has made a change in recommendation, we will give prompt notice to Buyer and the Merger Subsidiary of any written notice received from any person alleging that the consent of such person is required in connection with the merger or the other transactions contemplated by the merger agreement, any notice from any governmental authority in connection with the merger or the other transactions contemplated by the merger agreement, or any actions pending that relate to the merger or the other transactions contemplated by the merger agreement.

Access to Information; Confidentiality

From the date of the merger agreement until the effective time of the merger, we will, and will cause our representatives to, give Buyer and the Merger Subsidiary and their respective representatives, at their sole cost and risk, reasonable access to our officers, employees, agents, properties, facilities, books, records, contracts and other assets and will furnish Buyer and the Merger Subsidiary financial, operating and other data and information as Buyer and the Merger Subsidiary may reasonably request, including, to the extent prepared by us in the ordinary course of business, our monthly internally prepared financial statements. Buyer and the Merger Subsidiary, at their sole cost and risk, will have the right to make such due diligence investigations as Buyer and the Merger Subsidiary will deem necessary or reasonable, upon reasonable advance notice to us. However, Buyer and the Merger Subsidiary have agreed that any such investigations will be conducted in a manner as not to interfere unreasonably with or disrupt the normal operation of our business. Notwithstanding the above, we are not required to provide access to or disclose any information if we determine that such access or disclosure would be reasonably likely to result in a waiver of attorney-client privilege, work product protection or any other applicable privilege or to result in a violation of law. However, we will cooperate in good faith with Buyer to design and implement alternative procedures, if possible, to enable Buyer to evaluate the substance of any such information without causing a waiver or loss of any privilege or protection or any violation.

We entered into a confidentiality agreement dated August 27, 2011, with Linden Manager LP, an affiliate of Buyer, which we refer to as the confidentiality agreement. Under the terms of the confidentiality agreement, Linden Manager LP agreed that, subject to certain exceptions, any information regarding us or any of our affiliates or any of our respective assets or businesses furnished to Linden Manager LP by us or our representatives would be used by Linden Manager LP and its representatives solely for the purpose of evaluating a possible transaction between Linden Manager LP and its affiliates and us and would be kept confidential except as provided in the confidentiality agreement. The provisions of the confidentiality agreement remain in full force and effect and apply to Buyer and the Merger Subsidiary to the full extent that it applies to Linden Manager LP.

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No Solicitation

From the date of the merger agreement until consummation of the merger or, if earlier, the termination of the merger agreement, we agreed not to, and agreed not to authorize or permit any of our officers, directors or employees, or authorize any of our financial advisors, attorneys or other advisors or representatives to:

Notwithstanding the restrictions described above, at any time before the adoption of the merger agreement by our stockholders, if we receive an unsolicited written takeover proposal from a third party that did not result from a breach of the provisions of the merger agreement regarding restrictions on solicitations, we are entitled to participate or engage in discussions or negotiations regarding such takeover proposal and may provide or furnish information to the third party making the takeover proposal so long as our board of directors:

We may furnish information to a third party that has made a takeover proposal only in accordance with a confidentiality agreement that predates the merger agreement or that does not prohibit us from complying with our obligations under the merger agreement, and that generally contains provisions no less favorable to us in the aggregate than the provisions of the confidentiality agreement (other than standstill provisions). We must promptly, and in any event within 24 hours, make available to Buyer any non-public information relating to us that is made available to such third party that was not previously made available to Buyer.

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Change in Recommendation

Subject to the provisions described below, our board of directors unanimously agreed to recommend that our stockholders vote in favor of the adoption of the merger agreement at the special meeting, which we refer to as the board recommendation. Subject to the provisions described below, the merger agreement provides that, after the date of the merger agreement, neither our board of directors nor any committee of our board of directors will:

We refer to each of the foregoing actions as a change in recommendation.

Subject to the provisions described below, the merger agreement also provides that, after the date of the merger agreement, neither our board of directors nor any committee of our board of directors will cause or permit us to enter into any agreement or instrument relating to any takeover proposal.

Notwithstanding these restrictions, at any time before the adoption of the merger agreement by our stockholders, our board of directors may effect change in recommendation either:

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Notwithstanding the provisions described above, the merger agreement does not prohibit us or our board of directors from complying with Rule 14e-2 and Rule 14d-9 under the Exchange Act with regard to an acquisition proposal although such disclosure (other than a “stop, look and listen” communication or similar communication of the type contemplated by Section 14d-9(f) of the Exchange Act) will constitute change in recommendation unless our board of directors expressly publicly reaffirms the board recommendation in such communication or within ten business days after requested to do so by Buyer, or from making any required disclosure to our stockholders if, in the good faith judgment of our board of directors, after consultation with our outside counsel, failure to disclose would reasonably be expected to be inconsistent with our board of director’s obligations under law.

In addition, we have agreed to promptly (and in any event within 24 hours) advise Buyer of any request for information or for access to our properties, books or records by any third party that to our knowledge is seeking to make or has made any takeover proposal, or any inquiry with respect to or which could reasonably be expected to result in or lead to a takeover proposal, including in each case the material terms and conditions of such request, takeover proposal or inquiry, and the identity of the person making such request, takeover proposal or inquiry. We have agreed to keep Buyer informed as promptly as practicable in all material respects of the status and details (including material modifications or proposed modifications) of any such request, takeover proposal or inquiry.

As used in the merger agreement and this proxy statement:

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Indemnification and Insurance

Buyer and Merger Sub agree that all existing rights to indemnification and exculpation by us in favor of each person who prior to the effective time of the merger had been an officer, director or employee of ours or who acts as a fiduciary under any of our employee benefit plans, whom we refer to as the indemnified parties, as provided in our certificate of incorporation, by-laws, or any other agreements in effect on the date of the merger agreement, including provisions relating to the advancement of expenses incurred in the defense of any action, suit, or other proceeding, will survive the merger and will remain in full force and effect for a period of not less than six years after the effective time of the merger. From and after the effective time of the merger, Buyer and the surviving corporation will be jointly and severally liable to pay and perform in a timely manner these indemnification obligations.

Prior to the effective time of the merger, we will purchase one or more six-year “tail” policies on our directors’ and officers’ liability insurance policies in effect on the date of the merger agreement or comparable coverage in respect of actions or omissions occurring prior to the effective time of the merger. However, if the maximum cost of such tail policy exceeds 300% of our current annual premiums for such insurance, we will purchase one or more policies with the greatest coverage available at an annual premium equal to 300% of our current annual premium for such insurance. The surviving corporation will (and Buyer will cause the surviving corporation to) maintain such “tail” policies in full force and effect and continue to honor their respective obligations under the policies for a period of six years after the effective time of the merger.

If Buyer, the surviving corporation or any of their respective successors or assigns consolidates with or merges or converts into any other entity and is not the continuing or surviving corporation or entity of such consolidation, merger or conversion, or transfers all or substantially all of its properties and assets to any person or entity, then the merger agreement requires that proper provision be made so that the successors and assigns of Buyer or the surviving corporation will assume all of the applicable obligations described above. The indemnified parties are intended third-party beneficiaries of the indemnification and insurance provisions in the merger agreement.

Section 16 Matters

Prior to the effective time of the merger, we, Buyer and the Merger Subsidiary will take all steps required to cause the transactions involving the vesting and exercise of our stock options and our restricted stock awards and any other dispositions of our equity securities (including derivative securities) or acquisitions of Buyer’s equity securities (including derivative securities) in connection with the merger agreement by each individual who is subject to the reporting requirements of Section 16(a) of the Exchange Act with respect to us to be exempt under Rule 16b-3 under the Exchange Act.

Financing

Buyer and the Merger Subsidiary are required to arrange and obtain the proceeds of the financing described in the equity commitment letter dated February 12, 2012 between Buyer and Linden, which we refer to respectively as the equity financing and equity commitment letter, on the terms and conditions described in the equity commitment letter, including by:

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Buyer is not permitted to agree to any amendment or modification to, or grant any waiver of, any condition or other provision of the equity commitment letter without our prior written consent if that amendment, modification or waiver would reduce the aggregate amount of cash proceeds available from the equity financing to fund the merger and the other transactions contemplated by the merger agreement (as compared to the amount of aggregate proceeds contemplated under the equity financing as in effect on February 12, 2012) or would impose new or additional conditions that would be reasonably likely to:

Buyer may not release or consent to the termination of the obligations of the other parties to the equity commitment letter, except as expressly permitted by the equity commitment letter. Buyer may, however, amend, replace, supplement or otherwise modify, or waive any of its rights under, the equity commitment letter or any definitive agreements relating to the equity financing, and/or substitute debt or other equity financing for all or any portion of the equity commitment letter from the same and/or alternative financing sources, so long as that amendment, replacement, supplement or other modification or waiver does not:

If any portion of the equity financing becomes or could become unavailable in the manner or from the sources contemplated in the equity commitment letter:

Buyer is required to furnish us with complete, correct and executed copies of the agreements for the equity financing or any alternative financing promptly upon their execution, give us prompt notice of any breach or threatened breach by any party to the equity commitment letter, any alternative financing commitment or any alternative financing agreement or any termination or threatened termination thereof. Buyer is required to keep us reasonably informed of its efforts to arrange the equity financing or any alternative financing.

The obtaining of the equity financing (or any alternative financing) is not a condition to the obligations of Buyer and the Merger Subsidiary to consummate the merger and any related transactions.

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Financing Cooperation

We are required to use our commercially reasonable efforts to, and must direct our officers, directors, employees and other advisors or representatives to use their commercially reasonable efforts to, provide all customary and reasonable cooperation in connection with the arrangement of any debt financing or other alternative financing as Buyer may reasonably request, so long as the requested cooperation does not unreasonably interfere with our ongoing operations. Additionally, neither we nor any of our officers, directors, employees or other advisors and representatives are required to take any action that would subject any of us to actual or potential liability in connection with the equity financing or any alternative financing, unless the requirement to take that action is contingent upon the closing of the merger. Upon our request, Buyer is required to reimburse us and our officers, directors, employees and other advisors and representatives for all reasonable and documented out-of-pocket costs and expenses (including reasonable attorneys’ fees) incurred by them in connection with the cooperation described in this paragraph. Buyer and the Merger Subsidiary are also required to indemnify us and our officers, directors, employees and other advisors and representatives from and against any and all losses, claims, damages, liabilities, fees, expenses, judgments and fines arising in whole or in part out of any actions or omissions described in this paragraph.

Tax Withholding on Restricted Stock

Following the execution of the merger agreement, we are required to provide Buyer and the exchange agent with information regarding outstanding restricted stock awards so that they can determine the amount of any applicable withholding taxes with respect to any payments to be made in connection with the closing of the merger in respect of restricted stock awards.

Conditions to the Merger

The obligations of Buyer and the Merger Subsidiary, on the one hand, and us, on the other hand, to consummate the merger are subject to, among other things, the satisfaction of the following conditions:

The obligations of Buyer and the Merger Subsidiary to consummate the merger are subject to the satisfaction or, to the extent permitted by law, the waiver on or prior to the closing date of the merger of the additional following conditions:

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Our obligation to consummate the merger is subject to the satisfaction or, to the extent permitted by law, the waiver on or prior to the closing date of the merger of the additional following conditions:

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Termination of the Merger Agreement

We, Buyer and the Merger Subsidiary may terminate the merger agreement by mutual written consent at any time before the effective time of the merger. In addition, either Buyer or we may terminate the merger agreement, subject to certain conditions, at any time before the consummation of the merger if:

Buyer may not terminate the merger agreement based on a stockholder vote termination if Buyer or the Merger Subsidiary is in breach of its obligations to vote each of the shares owned by them in favor of the adoption of the merger agreement. We may not terminate the merger agreement based on a stockholder vote termination if the failure to obtain the necessary stockholder vote is caused by our action or failure to act, which action or failure to act constitutes a material breach by us under the merger agreement.

Buyer may also terminate the merger agreement at any time before the receipt of the affirmative vote of the holders of a majority of the outstanding shares of our common stock to adopt the merger agreement if:

Buyer may not terminate the merger agreement for the reasons described in the preceding three bullet points if a breach of the merger agreement by Buyer or the Merger Subsidiary would cause our closing conditions with respect to the accuracy of the representations and warranties of Buyer and the Merger Subsidiary or their compliance with their obligations under the merger agreement not to be satisfied.

We may also terminate the merger agreement at any time before the receipt of the affirmative vote of the holders of a majority of the outstanding shares of our common stock to adopt the merger agreement if:

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We may not terminate the merger agreement based on a buyer breach termination if a breach of the merger agreement by us would cause Buyer’s closing conditions with respect to the accuracy of our representations and warranties or our compliance with our obligations under the merger agreement not to be satisfied.

Additionally, we may terminate the merger agreement at any time prior to the effective time of the merger if:

The party that desires to terminate the merger agreement must give written notice of termination to each other party to the merger agreement.

Subject to certain exceptions, if the merger agreement is terminated, it will become null and void, without liability of any party (or any stockholder, director, officer, employee, agent, consultant or representative of such party) to each other party thereto. No such termination will relieve or release any party from any liabilities or damages arising out of its willful and intentional breach of the merger agreement. The sponsor guarantee and confidentiality agreement will not be affected by the termination of the merger agreement.

Termination Fees

We have agreed to pay Buyer a termination fee of $2.5 million, which we refer to as the termination fee, in the event that:

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Buyer has agreed to pay us a termination fee of $5.0 million, which we refer to as the reverse termination fee, in the event that we terminate the merger agreement based on a buyer breach termination or a failure to close termination.

Expenses

We and Buyer are required to pay our own expenses in connection with the merger agreement and consummation of the transactions contemplated thereby, whether or not the merger is consummated, except that Buyer agreed to pay any fees payable under or pursuant to antitrust or competition laws.

We also agreed that, if we terminate the merger agreement based on a stockholder vote termination, or if Buyer terminates the merger agreement based on a company breach termination or a non-solicitation breach termination, and at the time of termination neither Buyer nor the Merger Subsidiary was in breach of any provision of the merger agreement such that our closing conditions would not be satisfied, we will reimburse Buyer for up to $1.0 million of its reasonable and documented out-of-pocket fees and expenses, including legal fees and expenses, incurred in connection with the merger and the merger agreement. If we reimburse such expenses and must later pay the termination fee described above, the termination fee will be reduced by the amount of expenses so reimbursed.

Remedies

Prior to the valid termination of the merger agreement, Buyer and the Merger Subsidiary are entitled to seek and obtain an injunction, specific performance and other equitable relief to prevent breaches of the merger agreement by us and to enforce specifically the terms and provisions of the merger agreement, including our obligation to consummate the merger. The election to pursue an injunction, specific performance or other equitable relief will not restrict, impair or otherwise limit Buyer or the Merger Subsidiary from, in the alternative, seeking to terminate the merger agreement and collect the termination fee or expenses described above under “— Termination Fees” beginning on page 83 of this proxy statement and “— Expenses” above.

Prior to the valid termination of the merger agreement, we are entitled to seek and obtain an injunction, specific performance and other equitable relief to prevent breaches of the merger agreement by Buyer and the Merger Subsidiary and to enforce specifically the terms and provisions of the merger agreement; provided that we are entitled to seek and obtain an injunction, specific performance and other equitable relief to enforce Buyer’s and the Merger Subsidiary’s obligations to cause the equity financing to be funded and to consummate the merger only in the event that each of the following conditions has been satisfied: (A) the closing conditions described above under the first and third paragraphs of “— Conditions to the Merger” beginning on page 80 of this proxy statement (other than conditions that by their nature are to be satisfied at the closing) have been satisfied on the date the closing should have been consummated pursuant to the terms of the merger agreement but for the failure of the equity financing to be funded, and (B) we have confirmed in writing to Buyer that if the equity financing is funded, then we would take all such actions that are within our control to cause the closing to occur. The election to pursue an injunction, specific performance or other equitable remedy shall not restrict, impair or otherwise limit us from, in the alternative, seeking to terminate the merger agreement and collect the reverse termination fee described above under “— Termination Fees” beginning on page 83 of this proxy statement. In addition, we are entitled to enforce our rights (by litigation or otherwise) as a third-party beneficiary of the equity commitment letter in the event that the conditions in this paragraph are satisfied.

Other than in the case of fraud, in no event shall we, Buyer, the Merger Subsidiary or any of our respective former, current and future direct or indirect equity holders, controlling persons, stockholders, directors, officers, employees, agents, affiliates, members, managers, general or limited partners or assignees have the right to seek or obtain money damages from the other party or any of its former, current and future direct or indirect equity holders, controlling persons, stockholders, directors, officers, employees, agents, affiliates, members, managers, general or limited partners or assignees under the merger agreement (whether at law or in equity, in contract, in tort or otherwise) other than the right of Buyer, the Merger Subsidiary and us to payment of the termination fee, expenses or reverse termination fee described above under “— Termination Fees” beginning on page 83 of this proxy statement and “— Expenses” above.

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The parties to the merger agreement agree that irreparable damage for which monetary damages, even if available, would not be an adequate remedy would occur in the event that the parties to the merger agreement do not perform their obligations under the provisions of the merger agreement (including failing to take such actions as are required of them hereunder to consummate the merger and the other transactions contemplated by the merger agreement) in accordance with its specified terms or otherwise breach such provisions. The parties have acknowledged and agreed that (i) the parties will be entitled to an injunction or injunctions, specific performance or other equitable relief to prevent breaches of the merger agreement and to enforce specifically the terms and provisions in the merger agreement without proof of damages or otherwise, (ii) the provisions set forth above under “— Termination Fees” beginning on page 83 of this proxy statement and “— Expenses” beginning on page 84 of this proxy statement are not intended to and do not adequately compensate for the harm that would result from a breach of the merger agreement and should not be construed to diminish or otherwise impair in any way any party’s right to specific performance and (iii) such rights of specific enforcement are an integral part of the merger and without such rights, neither we nor Buyer would have entered into the merger agreement. Each of the parties to the merger agreement has agreed that it will not oppose the granting of an injunction, specific performance and other equitable relief on the basis that the other parties hereto have an adequate remedy at law or an award of specific performance is not an appropriate remedy for any reason at law or in equity.

Governing Law

The merger agreement is governed by, and construed in accordance with, the laws of the State of Delaware regardless of the laws that might otherwise govern under applicable principles of conflicts of laws thereof.

Equity Commitment Letter

On February 12, 2012, simultaneously with the execution of the merger agreement, the sponsors entered into an equity commitment letter pursuant to which the sponsors have committed to invest, directly or indirectly, at or immediately prior to the consummation of the merger, $82.0 million in Buyer or the Merger Subsidiary, solely for the purpose of (i) funding the aggregate merger consideration and (ii) paying all related fees and expenses pursuant to, and in accordance with, the merger agreement.

Sponsor Guarantee

On February 12, 2012, simultaneously with the execution of the merger agreement, the sponsors provided a guarantee to us under which they guaranteed certain obligations of Buyer and the Merger Subsidiary under the merger agreement, including the payment of any reverse termination fee and specified costs and expenses that may become payable by Buyer.

Amendment

On February 27, 2012, the parties to the original merger agreement entered into an amendment of the original merger agreement for the purpose of amending and restating the certificate of incorporation of the surviving corporation to substantially conform its indemnification and advancement of expenses provisions to those included in our certificate of incorporation immediately prior to the merger.

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APPRAISAL RIGHTS

Under Section 262 of the Delaware General Corporation Law, or the DGCL, any holder of our common stock who does not wish to accept the merger consideration may elect to exercise appraisal rights in lieu of receiving the merger consideration. A stockholder who exercises appraisal rights may petition the Delaware Court of Chancery to determine the “fair value” of his, her or its shares, exclusive of any element of value arising from the accomplishment or expectation of the merger, and receive payment of fair value in cash, together with a fair rate of interest, if any. However, the stockholder must comply with the provisions of Section 262 of the DGCL.

The following discussion is a summary of the law pertaining to appraisal rights under the DGCL. The full text of Section 262 of the DGCL is attached to this proxy statement as Annex C. All references in Section 262 of the DGCL to a “stockholder” and in this summary to a “stockholder” are to the record holders of the shares of our common stock.

Under Section 262 of the DGCL, when a merger is submitted for approval at a meeting of stockholders, as in the case of the merger agreement, the corporation, not less than 20 days prior to the meeting, must notify each of its stockholders entitled to appraisal rights that appraisal rights are available and include in the notice a copy of Section 262 of the DGCL. This proxy statement constitutes such notice, and the applicable statutory provisions are attached to this proxy statement as Annex C. This summary of appraisal rights is not a complete summary of the law pertaining to appraisal rights under the DGCL and is qualified in its entirety by the text of Section 262 of the DGCL attached as Annex C. Any holder of our common stock who wishes to exercise appraisal rights or who wishes to preserve the right to do so should review the following discussion and Annex C carefully. Failure to comply with the procedures of Section 262 of the DGCL in a timely and proper manner will result in the loss of appraisal rights. If you lose your appraisal rights, you will be entitled to receive the merger consideration described in the merger agreement.

Stockholders wishing to exercise the right to seek an appraisal of their shares must do ALL of the following:

Neither voting, in person or by proxy, against, abstaining from voting on nor failing to vote on the proposal to adopt the merger agreement will constitute a written demand for appraisal as required by Section 262 of the DGCL. The written demand for appraisal must be in addition to and separate from any proxy or vote.

Only a holder of record of shares of our common stock issued and outstanding immediately prior to the effective time of the merger may assert appraisal rights for the shares of stock registered in that holder’s name. A demand for appraisal must be executed by or on behalf of the stockholder of record, fully and correctly, as the stockholder’s name appears on the stock certificates or in the case of uncertificated shares, as the holder’s name appears on the stockholder register. The demand must reasonably inform us of the identity of the stockholder and that the stockholder intends to demand appraisal of his, her or its shares of our common stock.

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STOCKHOLDERS WHO HOLD THEIR SHARES IN BROKERAGE ACCOUNTS OR OTHER NOMINEE FORMS, AND WHO WISH TO EXERCISE APPRAISAL RIGHTS, SHOULD CONSULT WITH THEIR BROKERS OR NOMINEES TO DETERMINE THE APPROPRIATE PROCEDURES FOR THE NOMINEE HOLDER TO MAKE A DEMAND FOR APPRAISAL OF THOSE SHARES. A PERSON HAVING A BENEFICIAL INTEREST IN SHARES HELD OF RECORD IN THE NAME OF ANOTHER PERSON, SUCH AS A BROKER OR NOMINEE, MUST ACT PROMPTLY TO CAUSE THE RECORD HOLDER TO FOLLOW PROPERLY AND IN A TIMELY MANNER THE STEPS NECESSARY TO PERFECT APPRAISAL RIGHTS.

A stockholder who elects to exercise appraisal rights under Section 262 of the DGCL should mail or deliver a written demand to:

SeraCare Life Sciences, Inc.
37 Birch Street
Milford, Massachusetts 01757
Attention: Secretary

If the merger is completed, we will give written notice of the effective time of the merger within 10 days after such effective time to each former stockholder who did not vote in favor of the merger agreement and who made a written demand for appraisal in accordance with Section 262 of the DGCL. Within 120 days after the effective time of the merger, but not later, either the surviving corporation or any dissenting stockholder who has complied with the requirements of Section 262 of the DGCL may file a petition in the Delaware Court of Chancery demanding a determination of the fair value of the shares of our common stock held by all dissenting stockholders. The surviving corporation is under no obligation to file any petition, and we have no intention of doing so. Stockholders who desire to have their shares appraised should initiate any petitions necessary for the perfection of their appraisal rights within the time periods and in the manner prescribed in Section 262 of the DGCL.

Within 120 days after the effective time of the merger, any stockholder who has complied with the provisions of Section 262 of the DGCL to that point in time may receive from the surviving corporation, upon written request, a statement setting forth the aggregate number of shares not voted in favor of the merger agreement and with respect to which we have received demands for appraisal, and the aggregate number of holders of those shares. The surviving corporation must mail this statement to the stockholder within the later of 10 days of receipt of the request or 10 days after expiration of the period for delivery of demands for appraisal.

If a petition for appraisal is duly filed by a stockholder and a copy of the petition is delivered to the surviving corporation, the surviving corporation will then be obligated, within 20 days after receiving service of a copy of the petition, to provide the Delaware Court of Chancery with a duly verified list containing the names and addresses of all stockholders who have demanded an appraisal of their shares and with whom agreements as to the value of their shares have not been reached by the surviving corporation. After notice to dissenting stockholders who demanded appraisal of their shares, the Delaware Court of Chancery is empowered to conduct a hearing upon the petition and to determine those stockholders who have complied with Section 262 and who have become entitled to the appraisal rights provided thereby.

The Delaware Court of Chancery may require the stockholders demanding appraisal who hold certificated shares to submit their stock certificates to the court for notation of the pendency of the appraisal proceedings. If the stockholder fails to comply with the court’s direction, the court may dismiss the proceeding as to the stockholder.

The Delaware Court of Chancery will thereafter determine the fair value of the shares of our common stock held by dissenting stockholders, exclusive of any element of value arising from the accomplishment or expectation of the merger, but together with the interest, if any, to be paid on the amount determined to be fair value. Such interest rate shall be calculated as of effective date of the merger through the date of payment of the judgment, compounded quarterly, and shall accrue at 5% over the Federal Reserve discount rate (including any surcharge), unless good cause is shown for the Delaware Court of Chancery to use discretion and calculate the interest rate otherwise.

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In determining the fair value, the Delaware Court of Chancery will take into account all relevant factors. The Delaware Supreme Court has stated that “proof of value by any techniques or methods that are generally considered acceptable in the financial community and otherwise admissible in court” should be considered in the appraisal proceedings. In addition, Delaware courts have decided that the statutory appraisal remedy, in cases of unfair dealing, may or may not be a dissenter’s exclusive remedy. The Delaware Court of Chancery may determine the fair value to be more than, less than or equal to the consideration that the dissenting stockholder would otherwise receive under the merger agreement. If no party files a petition for appraisal in a timely manner, then stockholders will lose the right to an appraisal and will instead receive the merger consideration described in the merger agreement.

The Delaware Court of Chancery will determine the costs of the appraisal proceeding and will allocate those costs to the parties as the Delaware Court of Chancery determines to be equitable under the circumstances. Upon application of a stockholder, the Delaware Court of Chancery may order all or a portion of the expenses incurred by any stockholder in connection with the appraisal proceeding, including reasonable attorneys’ fees and the fees and expenses of experts, to be charged pro rata against the value of all shares entitled to appraisal.

The fair value of our common stock as determined under Section 262 of the DGCL could be greater than, the same as, or less than the merger consideration. An opinion of an investment banking firm as to the fairness, from a financial point of view, of the consideration payable in a merger is not an opinion as to, and does not in any manner address, fair value under Section 262 of the DGCL.

Any stockholder who has duly demanded an appraisal in compliance with Section 262 of the DGCL may not, after the effective time of the merger, vote the shares subject to the demand for any purpose or receive any dividends or other distributions on those shares, except dividends or other distributions payable to holders of record of shares as of a record date prior to the effective time of the merger.

If no petition for appraisal is filed within 120 days after the effective date of the merger, or if a stockholder delivers a written withdrawal of the stockholder’s demand for appraisal and an acceptance of the merger within 60 days after the effective date of the merger, then the right of the stockholder to appraisal will cease. Any attempt to withdraw made more than 60 days after the effective time of the merger will require written approval of the surviving corporation, and no appraisal proceeding in the Delaware Court of Chancery will be dismissed as to any stockholder without the approval of the Delaware Court of Chancery, and may be conditioned on such terms as the Delaware Court of Chancery deems just. If the stockholder fails to perfect, successfully withdraws or loses the appraisal right, the stockholder’s shares will be converted into the right to receive the merger consideration.

FAILURE TO FOLLOW THE STEPS REQUIRED BY SECTION 262 OF THE DGCL FOR PERFECTING APPRAISAL RIGHTS MAY RESULT IN THE LOSS OF APPRAISAL RIGHTS. IN THAT EVENT, YOU WILL BE ENTITLED TO RECEIVE THE MERGER CONSIDERATION FOR YOUR DISSENTING SHARES IN ACCORDANCE WITH THE MERGER AGREEMENT. IN VIEW OF THE COMPLEXITY OF THE PROVISIONS OF SECTION 262 OF THE DGCL, IF YOU ARE A STOCKHOLDER AND ARE CONSIDERING EXERCISING YOUR APPRAISAL RIGHTS UNDER THE DGCL, YOU SHOULD CONSULT YOUR OWN LEGAL ADVISOR.

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MARKET PRICE INFORMATION

Our common stock is listed on The NASDAQ Capital Market under the trading symbol “SRLS.” The following table provides the high and low sales prices of our common stock on the NASDAQ Capital Market, for each of the periods listed.

		Common Stock
		High		Low
Fiscal Year Ended September 30, 2010
First quarter		$	4.20			$	2.28
Second quarter		$	4.05			$	3.14
Third quarter		$	5.49			$	3.75
Fourth quarter		$	4.14			$	2.71
Fiscal Year Ended September 30, 2011
First quarter		$	4.97			$	3.33
Second quarter		$	4.92			$	3.70
Third quarter		$	4.48			$	3.11
Fourth quarter		$	4.18			$	2.76
Fiscal Year Ending September 30, 2012
First quarter		$	3.11			$	2.58
Second quarter, through         , 2012		$				$

The following table provides the closing sales prices per share of our common stock, as reported on the NASDAQ Capital Market on February 10, 2012, the last full trading day before the public announcement of the proposed merger, and on               , 2012, the latest practicable date before the printing of this proxy statement:

		Common Stock
February 10, 2012		$	3.58
, 2012		$

If the merger is consummated, each share of our common stock will be converted into the right to receive $4.00 in cash, without interest and less any applicable withholding taxes, and our common stock will be removed from quotation on the NASDAQ Capital Market and there will be no further public market for shares of our common stock.

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SECURITY OWNERSHIP OF
MANAGEMENT AND CERTAIN BENEFICIAL OWNERS

The following table provides information as of February 23, 2012, except as otherwise indicated in the footnotes to the following table, regarding the beneficial ownership of our common stock by:

Beneficial ownership is determined in accordance with the rules of the SEC and includes voting or investment power with respect to the securities. Shares of common stock that may be acquired by an individual or group within 60 days of February 23, 2012 pursuant to the exercise of options are deemed to be outstanding for the purpose of computing the percentage ownership of such individual or group, but are not deemed to be outstanding for the purpose of computing the percentage ownership of any other person shown in the table. Percentage of ownership is based on 20,199,094 shares of common stock outstanding on February 23, 2012.

Except as indicated in footnotes to this table, we believe that the stockholders named in this table have sole voting and investment power with respect to all shares of common stock shown to be beneficially owned by them, based on information provided to us by such stockholders or their SEC filings. Unless otherwise indicated, the address for each director and executive officer listed is: c/o SeraCare Life Sciences, Inc., 37 Birch Street, Milford, Massachusetts 01757.

Beneficial Owner		Number of Shares Beneficially Owned		Percentage of Common Stock Beneficially Owned
5% or Greater Stockholders
Combined group of Jacob Safier and Ltova Holdings LLC (1)			3,853,263				19.1	%
Wellington Management Company, LLP and Wellington Trust Company, NA (2)			2,294,358				11.4	%
Combined group of Coliseum Capital Management, LLC, Coliseum Capital, LLC, Coliseum Capital Partners, L.P., Blackwell Partners, LLC, Adam Gray and Christopher Shackleton (3)			1,499,249				7.4	%
Named Executive Officers and Directors
Gregory A. Gould (4)			660,629				3.3	%
Ronald R. Dilling (5)			180,485				*
Katheryn E. Shea (6)			149,503				*
John J. (Sean) O’Connor II (7)			90,000				*
Joseph M. Nemmers, Jr (8)			27,439				*
E. Kevin Hrusovsky (9)			14,379				*
Sarah L. Murphy (10)			105,645				*
Jill Tillman (11)			104,859				*
Susan L.N. Vogt (12)			864,680				4.3	%
All current executive officers and directors as a group (8 persons) (13)			1,332,939				6.6	%