(a)

Organization, Standing and Corporate Power.  Each of Company and each of its Subsidiaries is a corporation, partnership or other legal entity duly organized, validly existing and in good standing under the Laws of the jurisdiction in which it is organized and has the requisite power and authority to own its assets and conduct its Business.  Except as disclosed in Section (a) of the Company Disclosure Statement, each of Company and each of its Subsidiaries is duly qualified or licensed to do business and is in good standing in each jurisdiction in which the nature of its business or the ownership or leasing of its properties makes such qualification or licensing necessary.  Company has made available for review by Parent complete and correct copies of its articles of incorporation and by-laws and the certificates of incorporation and by-laws or comparable organizational documents of its Subsidiaries, in each case as amended to the date of this Agreement.  Each of Company and its Subsidiaries has not been, for the last 3 years prior to the date hereof, and is not in violation of any provision of its articles of incorporation or by-laws or comparable organizational documents.

(b)

Company Subsidiaries.  Section (b) of the Company Disclosure Statement lists each Subsidiary of Company and the percentage ownership or interest therein of Company.  All the outstanding shares of capital stock of each such Subsidiary have been validly issued and are fully paid and non-assessable and, except as set forth in Section (b) of the Company Disclosure Statement, are owned by Company or by another Subsidiary of Company or both, free and clear of all pledges, claims, restrictions, liens, charges, mortgages, hypothecs, deeds of trust, royalties, security interests and other encumbrances of any kind or nature whatsoever held by third parties (collectively, "Liens").  Except for the capital stock of the Subsidiaries of Company and except for the percentage ownership interests set forth in Section (b) of the Company Disclosure Statement, Company does not own, directly or indirectly, any capital stock or other ownership interest.

(c)

Capitalization.  The authorized capital (the "Authorized Capital") and issued capital of Company is as set forth in recital A to this Agreement.  Except as set forth above, there are no shares of capital stock or other voting securities of Company issued, reserved for issuance or outstanding.  Except as set forth in Section (c) of the Company Disclosure Statement, there are no bonds, debentures, notes or other indebtedness of Company having the right to vote (or convertible into, or exchangeable for, securities having the right to vote) on any matters on which Shareholders must vote.  Except as set forth in recital B to this Agreement and except as set forth in Section (c) of the Company Disclosure Statement, as of the date of this Agreement, there are not any options, warrants, puts, calls, rights, commitments, agreements, arrangements or undertakings of any kind (collectively, "Options") to which Company or any of its Subsidiaries is a party or by which any of them is bound relating to the issued or unissued capital stock of Company or any of its Subsidiaries, or obligating Company or any of its Subsidiaries to issue, transfer, grant, sell or pay for or repurchase any shares of capital stock or other equity interests in, or securities convertible or exchangeable for any capital stock or other equity interests in, Company or any of its Subsidiaries or obligating Company or any of its Subsidiaries to issue, grant, extend or enter into any such Options.  All shares of Company's capital stock that are subject to issuance as aforesaid, upon issuance on the terms and conditions specified in the instrument pursuant to which they are issuable, will be duly authorized, validly issued, fully paid and non-assessable.  The issuance and sale of all of the shares of capital stock described in Section (c) of the Company Disclosure Statement have been so issued and sold in compliance with Law.  Company has previously provided Parent with a schedule setting forth the names of, and the number of shares of each class (including the number of shares issuable upon exercise of Options and the exercise price and vesting schedule with respect thereto) and the number of options held by, all holders of Options.  Section (c) of the Company Disclosure Statement sets forth the weighted average exercise price for outstanding Options.  Except as set forth in Section (c) of the Company Disclosure Statement, Company has not agreed to register any securities under any securities Law or granted registration rights to any person or entity; copies of all such agreements have previously been made available to Parent. Except as set forth above and in Section (c) of the Company Disclosure Statement, as of the date of this Agreement, there are not any outstanding contractual obligations or other requirements of Company or any of its Subsidiaries to repurchase, redeem or otherwise acquire any shares of capital stock of Company or any of its Subsidiaries, or provide funds to or make any investment (in the form of a loan, capital contribution or otherwise) in, any Subsidiary of Company or any other person.  Without limiting the generality of the foregoing, except as set out in Section (c) of the Company Disclosure Statement, there are no stock appreciation rights, phantom equity or similar rights, agreements, arrangements or commitments based upon the book value, income or any other attribute of Company or any of its Subsidiaries.

(d)

Authority; Non-Contravention.

(i)

Company has all requisite corporate power and corporate authority to enter into this Agreement and, subject to Court and Shareholder Approval, to consummate the Transactions and to perform its obligations under this Agreement.  On December 11, 2013, the board of directors of Company unanimously approved this Agreement and the Transactions and resolved to recommend to Shareholders that Shareholders give Shareholder Approval.  The execution and delivery of this Agreement by Company and the consummation by Company of the Transactions have been duly authorized by all necessary corporate action on the part of Company, subject to Shareholder Approval.  No other corporate proceedings on the part of Company or any of its Subsidiaries are necessary to authorize Company to enter into this Agreement, the performance by Company of its obligations under this Agreement and, subject to Shareholder Approval, the Transactions.  This Agreement has been duly executed and delivered by Company and constitutes a valid and binding obligation of Company, enforceable by Parent against Company in accordance with its terms, subject to the availability of equitable remedies and the enforcement of creditors' rights generally.  Except with respect to the Consents and Approvals (as defined herein) or any required Novation Agreement or FAR 42.12 Other Agreement, the execution and delivery of this Agreement does not, and the consummation of the Transactions and compliance with the provisions of this Agreement will not, conflict with, or result in any violation of, or default (with or without notice or lapse of time, or both) under, or give rise to a right of first refusal, consent, termination, buyback, purchase, cancellation or acceleration of any obligation or to loss of any property, rights or benefits under, or result in the imposition of any additional obligation under, or result in the creation of any Lien upon any of the properties or assets of Company or any of its Subsidiaries under (x) the articles of incorporation or by-laws of Company or the comparable organization documents of any of its Subsidiaries; (y) any material Contract or Permit to which Company or any of its Subsidiaries is a party or by which any of them or their respective properties or assets is bound or affected, or (z) any Law applicable to Company or any of its Subsidiaries or their respective properties or assets, except with respect to (z) only, as would not have a material effect on the Business.  Other than any required Novation Agreement or Other FAR 42.12 Agreement, no consent, approval, order or authorization of, or registration, declaration or filing with, any Agency, is required by or with respect to Company or any of its Subsidiaries in connection with the execution and delivery of this Agreement by Company or the consummation by Company of the Transactions, except for (A) the filing with the applicable securities regulatory Agencies of the Company Circular and any other documents required to be filed or publicly disclosed in connection with the Transactions, (B) the Interim Order and the Final Order and any approvals required thereby, (C) filings with the Director under the OBCA, (D) the Regulatory Approvals and (E) such other consents, approvals, orders, authorizations, registrations, declarations and filings as are set forth in Section (d)(i) of the Company Disclosure Statement (collectively, the items in clauses (A), (B), (C), (D) and (E) are referred to as the "Consents and Approvals").

(ii)

Except as set forth in Section (d)(ii) of the Company Disclosure Statement, none of Company or any of its Subsidiaries is a party to or bound by any non-competition Contract or other Contract, in each case, that purports to limit in any material respect either the type of business in which Company or any of its Subsidiaries (or, after giving effect to the Transactions, Parent or its Subsidiaries) may engage, including the development, commercialization, manufacture, marketing, sale or distribution of any Company Product that is material or could reasonably be expected to become material to Company or any of its Subsidiaries, or the manner or locations in which any of them may so engage in any business with respect to the Company Products.

(e)

Publicly Filed Documents; Undisclosed Liabilities.  Company has filed all required reports, schedules, forms, statements and other documents (including documents incorporated by reference) with the applicable securities regulatory Agencies since July 31, 2009 (the "Company Public Disclosure Documents"). As of their respective dates, each Company Public Disclosure Document materially complied in all respects with the requirements of all applicable securities Law.  None of the Company Public Disclosure Documents, as of their respective dates, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading, except to the extent that such statements have been modified or superseded by a later-filed Company Public Disclosure Document.  The consolidated financial statements of Company included in the Company Public Disclosure Documents comply as to form in all material respects with applicable accounting requirements and the published rules and regulations of the applicable securities regulatory Agencies with respect thereto, have been prepared in accordance with GAAP, IFRS or FAR, as applicable, applied on a consistent basis during the periods involved (except as may be indicated in the notes thereto) and fairly present the consolidated financial position of Company as of the dates thereof and the consolidated results of its operations and cash flows for the periods then ended (subject, in the case of unaudited statements, to normal year-end audit adjustments).  Except (i) as and to the extent disclosed, reflected or reserved against on the balance sheet or the notes thereto of Company as of July 31, 2013, included in the Filed Company Public Disclosure Documents, as incurred after the date thereof in the ordinary course of business consistent with past practice and not prohibited by this Agreement or (ii) as set forth in Section (e) of the Company Disclosure Statement, Company does not have any material liabilities or obligations of any nature, whether known or unknown, absolute, accrued, contingent or otherwise and whether due or to become due.  Except as set forth in Section (e) of the Company Disclosure Statement, none of Company or its Subsidiaries is subject to the informational reporting requirements of, or required to file any form or other document with, any securities regulatory Agency (including any stock exchange).

(f)

Working Capital, Cash. Company had the amount of Working Capital at October 31, 2013 and cash at October 31, 2013 in each case as set forth in Section (f) of the Company Disclosure Statement.

(g)

Information Supplied.  None of the information supplied or to be supplied by Company or its Subsidiaries for inclusion or incorporation by reference in the Company Circular or any other filings relating to the Transactions will, at the date the Company Circular is first mailed to Shareholders, or at the time of the Special Meeting, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of circumstances under which they are made, not misleading.  The Company Circular will comply as to form in all material respects with the requirements of applicable securities Law, except that no representation or warranty is made by Company with respect to statements made or incorporated by reference therein based on information supplied by Parent for inclusion or incorporation by reference in the Company Circular.

(h)

Absence of Certain Changes or Events.  Except as disclosed in the Company Public Disclosure Documents filed and publicly available prior to the date of this Agreement (the "Filed Company Public Disclosure Documents") and except as set forth in Section (h) or Section (v) of the Company Disclosure Statement, since July 31, 2013, Company has conducted, and caused each of its Subsidiaries to conduct, its respective business only in the ordinary course of business consistent with past practice and:

(i)

there has not been any event, change, effect or development (including any decision to implement such a change made by the board of directors of Company or any of its Subsidiaries in respect of which senior management believes that confirmation of such board of directors is probable), which, individually or in the aggregate, has had, or would reasonably be expected to have, a Materially Adverse effect;

(ii)

there has not been any declaration, setting aside or payment of any dividend or other distribution (whether in cash, stock or property) with respect to any Common Shares;

(iii)

there has not been any split, combination or reclassification of any Authorized Capital of Company or any issuance or the authorization of any issuance of any other securities in exchange or in substitution for shares of Authorized Capital of Company;

(iv)

there has not been (A) any granting by Company or any of its Subsidiaries to any officer of Company or any of its Subsidiaries of any increase in or acceleration of compensation, (B) any granting by Company or any of its Subsidiaries to any officer of Company or any of its Subsidiaries of any increase in severance or termination pay, or (C) any entry by Company or any of its Subsidiaries into any employment, severance or termination agreement with any officer of Company or any of its Subsidiaries;

(v)

there has not been any change in accounting methods, principles or practices by Company or any of its Subsidiaries materially affecting its assets, liabilities or business, except insofar as may have been required by a change in IFRS;

(vi)

neither Company nor any of its Subsidiaries has engaged in any action which, if done after the date of this Agreement, would violate Section 7.1 of this Agreement;

(vii)

no liability or obligation of any nature (whether absolute, accrued, contingent or otherwise) that is Materially Adverse has been incurred other than in the ordinary course of business consistent with past practice; and

(viii)

neither Company nor Subsidiary has (A) acquired or disposed of, or agreed to acquire or dispose of, any material asset other than in the ordinary course of business or (B) incurred any material indebtedness for borrowed money on a consolidated basis.

(i)

Disclosure.

(i)

The Data Room Information does not omit or misrepresent any information necessary for an understanding of the Business. Financial projections and financial forecasts in the Data Room were made in good faith based on reasonable assumptions at the time they were made.

(ii)

Except as has been disclosed in Section (i) or Section (v) of the Company Disclosure Statement, since July 31, 2013:

(A)

there are no severance, change of control or employment agreements with respect to current or former employees of Company or any of its Subsidiaries or any bonus or incentive arrangements with respect to such employees that may require payments as a result of the Transactions;

(B)

Company and its Subsidiaries do not have liabilities or obligations in excess of the liabilities or obligations reflected or reserved against in the financial statements and in any event that are not incurred in the ordinary course of business consistent with past practice; and

(C)

none of Company or any of its Subsidiaries or any of their properties is subject to a material judgment, order or decree.

(j)

Compliance with Law and Permits.

(i)

Except as set forth in Section (j)(i) of the Company Disclosure Statement, to the knowledge of Company:

(A)

each of Company and its Subsidiaries holds and has, for the last 3 years prior to the date hereof, maintained in good standing all material Permits necessary for Company and its Subsidiaries to own, lease and operate their properties or other assets and to carry on their respective businesses (the "Company Permits");

(B)

none of the Company Permits has been or is being revoked, nor has Company received any communication from a regulatory authority alleging that such Company Permit will be revoked in the future, absent corrective action; and

(C)

each of Company and its Subsidiaries has been, for the 3 years prior to the date hereof, and is in compliance in all material respects with all applicable Laws and all Company Permits, except for violations that have been or are being resolved.

(ii)

For the past 3 years prior to the date hereof, neither Company nor any of its Subsidiaries has received any written notice of proceedings for the revocation, suspension, termination or modification of any material Company Permits, and, except as set forth in Section (j)(ii) of the Company Disclosure Statement, to the knowledge of Company, there are no facts or circumstances materially relevant to the revocation, suspension, modification or termination of any material Company Permits held by Company or by others, that reasonably could lead to the revocation, suspension, modification or termination of any such material Company Permits, except where such revocation, suspension, modification or termination is not in respect of a material Company Permit.

(iii)

Except as disclosed in Section (j)(iii) of the Company Disclosure Statement, neither Company nor any Subsidiary is in material default with respect to filings to be effected or conditions to be fulfilled in order to maintain the Company Permits described in this Section (j) in material good standing.

(iv)

None of the Company Permits described in this Section (j) contains any term, provision, condition or limitation which is atypical for such type of permit, or that has or would reasonably be expected to affect or restrict in any material respect the operations of Company or its Subsidiaries, the Business, or the completion of the Transactions.

(v)

Except as disclosed in Section (j)(v) of the Company Disclosure Statement each of Company and its Subsidiaries has operated, for the last 3 years prior to the date hereof, the Business in material compliance with all applicable Law of each jurisdiction in which it carries on the Business.

(k)

Restrictions on Business Activities. Except as disclosed in Section (k) of the Company Disclosure Statement, there is no agreement, judgment, injunction, order or decree binding upon Company or any of its Subsidiaries that has, or would reasonably be expected to have, the effect of prohibiting, restricting or impairing any business practice of Company or any of its Subsidiaries, any acquisition of assets by Company or any of its Subsidiaries or the conduct of the Business by any of them (including following the Arrangement) other than such agreements, judgments, injunctions, orders or decrees which are not, individually or in the aggregate, material to the Business.

(l)

Contracts. Section (l) of the Company Disclosure Statement lists all Material Contracts to which Company or any of its Subsidiaries is bound. "Material Contracts" means:

(i)

Contracts which contain minimum purchase conditions of $500,000 or requirements or other terms that restrict or limit the purchasing relationships of, or impose development or commercialization obligations on, Company or any of its Subsidiaries other than in the ordinary course of business; and

(ii)

Contracts involving annual revenues or expenses to the Business in excess of $500,000.

(m)

Tax Matters.

(i)

For the past 6 fiscal years, Company and each of its Subsidiaries have filed, or caused to be filed with the appropriate Agency, all income Tax Returns required to be filed by them in accordance with applicable Laws and have paid the income Taxes due whether or not shown as owing on any income Tax Return, except where the failure to file or failure to pay income Taxes would not individually or in the aggregate be material to the Business.  All such income Tax Returns are true, correct and complete in all material respects and have been completed in accordance with applicable Law.

(ii)

Reserves and provisions for Taxes accrued but not yet due on or before the Effective Date as reflected in Company's financial statements contained in the Filed Company Public Disclosure Documents are adequate as of the date of such financial statements, in accordance with IFRS.  For the past 6 fiscal years, no material deficiencies for Taxes have been proposed, asserted or assessed against Company or any of its Subsidiaries that are not adequately reserved against.

(iii)

To the knowledge of Company, except as set forth in Section (m)(iii) of the Company Disclosure Statement, there are no actions, suits, proceedings, investigations, or claims now threatened or pending against Company or any of its Subsidiaries in respect of any Taxes, or assessments.

(iv)

Company has delivered to Parent correct and complete copies in all material respects of all income Tax Returns, notices of assessment and all correspondence with taxing authorities by Company or any of its Subsidiaries for fiscal years 2009 - 2012 together with all requested working papers, calculations and schedules related thereto.  For purposes of clarity, such copies that include sensitive information have been provided by Company to Parent in accordance with the terms and provisions of the Confidentiality Agreement.

(v)

Except as set forth in Section (m)(v) of the Company Disclosure Statement, as of the date hereof, no election, consent for extension, nor any waiver that extends any applicable assessment period or statute of limitations relating to the determination of an income Tax liability of Company or any of its Subsidiaries has been filed or entered into and is still effective.

(vi)

Since July 31, 2010, Company and each of its Subsidiaries have in all material respects duly and timely collected all material amounts on account of any goods, services, sales, value added, transfer or other Taxes required to have been collected by it in accordance with applicable Law and have duly set aside in trust or timely remitted to the appropriate taxing Agency any and all such amounts required to be remitted by it in accordance with applicable Law.

(vii)

Company and each of its Subsidiaries is, and at all times since July 31, 2010, has filed its Tax Returns on the basis that it is, resident for Tax purposes in its country of incorporation or formation and has not at any time been treated by any taxing Agency as resident in any other country for any Tax purpose (including any treaty, convention or arrangement for the avoidance of double taxation).  None of Company or any of its Subsidiaries has filed any Tax Return on the basis that it is subject to Tax in any jurisdiction other than its country of incorporation or formation (and political subdivisions thereof) or received written notification from any Agency that it may be required to file a Tax Return or may be liable for any Tax on such basis.

(viii)

Since July 31, 2010, Company and each of its Subsidiaries have in all material respects properly withheld all material amounts of Taxes required to be withheld (including income tax, non-resident withholding tax, Canada Pension Plan contributions, Employment Insurance and Worker's Compensation premiums) in accordance with applicable Law and have in all material respects paid such amounts due to the appropriate taxing Agency on a timely basis in accordance with applicable Law.

(ix)

For the past 3 years prior to the date hereof, Company and all of its Subsidiaries have paid all instalments of Taxes required by Law.

(x)

There are no Tax Liens on any assets of Company or any of its Subsidiaries except for Permitted Liens.

(xi)

For 6 years prior to the date hereof, none of sections 80, 80.01, 80.02, 80.03 or 80.04 of the ITA, or any equivalent provision of the tax legislation of any province or any other jurisdiction, has applied or will apply to Company or any of its Subsidiaries at any time up to and including the Effective Time.

(xii)

Except as disclosed in Section (m)(xii) of the Company Disclosure Statement, none of Company or its Subsidiaries is liable for Taxes of any other person (A) by entering into any agreement with any person pursuant to which it assumed liability for the payment of Taxes owing by such person, or (B) under any provision of applicable Law.

(xiii)

Since July 31, 2010, records or documents that meet the requirements of subsection 247(4) of the ITA in all material respects have been made and/or obtained by Company and each of its Subsidiaries with respect to all material transactions between Company or any of its Subsidiaries, as applicable, and any non-resident person with whom Company or such Subsidiary was not dealing at arm's length for purposes of the ITA with respect to any taxation year or period ending prior to the date hereof and in respect of which the CRA is entitled to assess a liability against Company or the Subsidiary, as applicable.

(n)

Real Property/Leased Real Property.

(i)

Section (n)(i) of the Company Disclosure Statement lists all real or immovable property owned by Company or its Subsidiaries, which property is owned free and clear of all Liens, except for Permitted Liens (the "Owned Real Property").  Except as disclosed in Section (n)(i) of the Company Disclosure Statement, neither Company nor its Subsidiaries has leased, subleased, licensed or entered into an occupancy agreement with respect to the Owned Real Property or any portion thereof that is currently in effect.  Neither Company nor any of its Subsidiaries has granted options, rights of first offer or rights of first refusal to purchase the Owned Real Property or any portion thereof which are outstanding as of the date hereof.

(ii)

Section (n)(ii) of the Company Disclosure Statement lists each lease, sublease, license or occupancy agreement for real or immovable property leased, subleased, licensed or occupied by Company or its Subsidiaries (the "Leased Real Property" and together with the Owned Real Property, the "Real Property"), each of which is valid, legally binding and enforceable against Company or any of its Subsidiaries, as applicable, each of which leasehold or license or comparable interest is held free and clear of all Liens, except for Permitted Liens,  in accordance with its terms and in full force and effect unamended by oral or written agreement, (except as otherwise set forth in Section (n)(ii) of the Company Disclosure Statement), and neither of Company nor any of its Subsidiaries is in breach of, or default under, such lease, sublease, license or occupancy agreement, and no event has occurred which, with notice, lapse of time or both, would constitute such a breach or default by Company or any of its Subsidiaries or permit termination, modification or acceleration by any third party thereunder.  Except as otherwise set forth in Section (n)(ii) of the Company Disclosure Statement, no third party has terminated, repudiated or has the right to terminate or repudiate any such lease, sublease, license or occupancy agreement (except for the normal exercise of remedies in connection with a default thereunder or any termination rights set forth in the lease, sublease, license or occupancy agreement) or any provision thereof.  None of the leases, subleases, licenses or occupancy agreements currently in effect have been assigned by Company or any of its Subsidiaries in favour of any person or sublet or sublicensed.

(iii)

With respect to each lease, sublease, license or occupancy agreement currently in effect, neither Company nor its Subsidiaries have transferred, conveyed, mortgaged or encumbered its leasehold interest, except as disclosed in Section (n)(iii) of the Company Disclosure Statement.

(iv)

The Real Property constitutes all of the real property used by Company or its Subsidiaries in connection with the operation of the Business.

(v)

To the knowledge of Company no material maintenance and repairs regarding the Real Property have been deferred in contemplation of the Transactions.

(vi)

No proceeding is pending or, to the knowledge of Company, threatened for the taking of all or any portion of the Real Property.  Neither Company nor its Subsidiaries has received written notice that there are any pending or, to the knowledge of Company, that there have been any requests, applications or proceedings threatened in writing, to currently alter or restrict any zoning or other use restrictions applicable to the Real Property.

(o)

Personal Property. Company and its Subsidiaries have valid, good and marketable title to all material personal or movable property of any kind or nature which Company or any of its Subsidiaries purports to own, as applicable, free and clear of all Liens, except for Permitted Liens and as disclosed in Section (o) of the Company Disclosure Statement.  Company and its Subsidiaries, as lessees, have the right under valid and subsisting leases to use, possess and control all personal or movable property leased by and material to Company or any of its Subsidiaries as used, possessed and controlled by Company or its Subsidiaries, as applicable, free and clear of all Liens, except for Permitted Liens and as disclosed in Section (o) of the Company Disclosure Statement. All Contracts for personal property leased, subleased, licensed or otherwise conveyed to Company or any of its Subsidiaries involving annual payments in excess of $10,000 are identified on Section (o) of the Company Disclosure Statement. See Section (ll)(xiii) regarding U.S. Government Furnished Property.

(p)

Title to Assets. Company and its Subsidiaries own with good title all of the properties and assets, whether real, personal or mixed and whether tangible or intangible, that they purport to own including all the properties and assets reflected as being owned by Company or its Subsidiaries in their financial books and records, subject to Permitted Liens and as disclosed in Section (p) of the Company Disclosure Statement.  To the knowledge of Company, the assets of Company and its Subsidiaries and any assets leased or licensed by Company and its Subsidiaries (excluding U.S. Government Furnished Product) include all rights and property necessary to enable Parent to continue to conduct the Business after the Effective Time substantially in the same manner as it is currently conducted, subject to the Consents and Approvals. See Section (ll)(xiii) regarding U.S. Government Contracts.

(q)

Intellectual Property.  To the knowledge of Company (i) Section (q)(i) of the Company Disclosure Statement lists all material Intellectual Property owned, possessed or licensed (each such license is valid and enforceable) by Company and its Subsidiaries ("Company Intellectual Property") excluding Trade Secrets and software (such software is set forth in Section (q)(xii) of the Company Disclosure Statement); (ii) except as described in Section (q)(ii) of the Company Disclosure Statement, Company has all rights or licenses necessary to use all Intellectual Property in the conduct of the Business; (iii) except as disclosed in Section (q)(iii) of the Company Disclosure Statement, no third parties have rights to any Company Intellectual Property; (iv) no employee, consultant or independent contractor of Company or any of its Subsidiaries has any ownership right, in or to any of the Intellectual Property described in Section (q)(i) of the Company Disclosure Statement and no such person has claimed any such right, except as described in Section (q)(iv) of the Company Disclosure Statement; (v) each employee, consultant or independent contractor responsible for the development of any Intellectual Property described in Section (q)(i) of the Company Disclosure Statement has assigned, or has an obligation to assign, such Intellectual Property described in Section (q)(i) of the Company Disclosure Statement to Company or its Subsidiaries pursuant to a valid and enforceable assignment agreement, and has waived all moral rights in such Intellectual Property, or has an obligation to waive the same, pursuant to a valid and enforceable waiver, except as described in Section (q)(v) of the Company Disclosure Statement; (vi) there is no infringement by third parties of any Company Intellectual Property, except as described in Section (q)(vi) of the Company Disclosure Statement;(vii) there is no pending or threatened action, suit, proceeding or claim by others challenging Company's rights in or to any Company Intellectual Property, and there are no facts which form a reasonable basis for any such claim, except as described in Section (q)(vii) of the Company Disclosure Statement; (viii) there is no pending or threatened action, suit, proceeding or claim by others challenging the validity or enforceability of any Company Intellectual Property, and there are no findings of unenforceability or invalidity of the Intellectual Property, except as described in Section (q)(viii) of the Company Disclosure Statement; (ix) the litigation disclosed or referenced in Section (q)(ix) of the Company Disclosure Statement is a true and correct list of all threatened claims by others that Company or any of its Subsidiaries infringes or otherwise violates any patent application, patent, patent right, license, invention, copyright, know how (including other unpatented or unpatentable or both proprietary or confidential information, system or procedure) trade secret, trademark, service mark or trade name of others; (x) there is no patent or patent application that contains claims that would form the basis for interference proceedings with the issued or pending claims of any of the Company Intellectual Property; (xi) all material prior art for any patent application owned by Company or any of its Subsidiaries has been disclosed to each of the relevant Patent and Trademark Office, as applicable; (xii) Section (q)(xii) of the Company Disclosure Statement identifies and sets forth (A) a true and correct list of all material software owned by Company or its Subsidiaries and (B) a true, correct and complete list of all software (other than commercially available shrink wrap software, off the shelf software (by way of example only, Adobe Acrobat or Microsoft Word), or software downloadable from the internet, having an aggregate license fee of less than $10,000 annually) licensed to Company or its Subsidiaries; (xiii) no employee of Company or any of its Subsidiaries has made unauthorized disclosure of a Company Trade Secret to a third party; and (xiv) no employee, consultant or independent contractor of Company or any of its Subsidiaries has made unauthorized disclosure of a third party's Trade Secret to Company or its Subsidiaries, except as described in Section (q)(xiv) of the Company Disclosure Statement.

(r)

Employment Matters.

(i)

Except as to matters otherwise specifically set forth in Section (r)(i) of the Company Disclosure Statement, none of Company or its Subsidiaries are a party to any agreement, obligation or understanding providing for severance or termination payments to, or any written employment agreement with, any director, independent contractor, dependent contractor, consultant, employee or officer, other than any common law obligations of reasonable notice of termination or pay in lieu thereof and any minimum statutory obligations.

(ii)

To the knowledge of Company, except as set forth in Section (r)(ii) of the Company Disclosure Statement, no current Business Personnel (as defined below) are subject to any written agreement with any third party, person or entity restricting such Business Personnel from engaging in competitive activities or solicitation of customers.

(iii)

None of Company or any of its Subsidiaries had or has any labour contracts or collective bargaining agreements with any union or bargaining agent or consulting agreements with any persons employed by Company or any persons otherwise performing services primarily for Company or any of its Subsidiaries (the "Business Personnel").  To the knowledge of Company, for the last 3 years prior to the date hereof, neither Company nor any of its Subsidiaries has engaged in any unfair labour practice with respect to the Business Personnel and there is no unfair labour practice complaint pending or, to the knowledge of Company, threatened, against Company or any of its Subsidiaries with respect to the Business Personnel.  There is no labour strike, dispute, slowdown or stoppage pending or, to the knowledge of Company, any current union organizing activities among the Business Personnel or any threatened labour strike, dispute, slowdown or stoppage against Company or any of its Subsidiaries, and neither Company nor any of its Subsidiaries has, since July 31, 2013, experienced any labour strike, dispute, slowdown or stoppage or other labour difficulty involving the Business Personnel.

(iv)

None of Company or its Subsidiaries is subject to any material litigation, actual or, to the knowledge of Company, threatened, relating to employment or termination of employment of employees, independent contractors or dependent contractors.

(v)

Except as set forth in Section (r)(v) of the Company Disclosure Statement, for the last 3 years prior to the date hereof, Company and each of its Subsidiaries has operated in accordance with all applicable Law with respect to employment and labour, including employment and labour standards, employment eligibility verification, immigration laws, rules and regulations, occupational health and safety, employment equity, pay equity, workers' compensation, independent contractor classification, classification under the United States Fair Labor Standards Act, as amended, and analogous laws and regulations, human rights and labour relations, and there are no current, pending or, to the knowledge of Company, threatened proceedings before any Agency or in any court with respect to any of the above.

(vi)

Except as set forth in Section (r)(vi) of the Company Disclosure Statement, Company is not delinquent in payments to any of the Business Personnel for any wages, salaries, commissions, vacation pay, bonuses or other direct compensation for any services performed by them to the date hereof or amounts required to be reimbursed to such Business Personnel.

(vii)

Company has provided Parent and Buyer a list of all the current Business Personnel as of the date hereof along with their compensation and accrued holiday, vacation or personal leave time contemplated as of Effective Date, pay cycles for all groups of employees, original hire date, home address, status under the United States Fair Labor Standards Act, as amended, and analogous laws, and base pay rate.

(viii)

Except as set forth in Section (r)(viii) of the Company Disclosure Statement, Company is in material compliance with all requirements of United States Executive Order 11246, including any applicable requirements that it maintain and report on affirmative action plans.

(ix)

To the knowledge of Company, as of the Effective Date, no Company executive or group of key Company employees has any plans to terminate his, her or their employment with, or provision of services to, Company or Buyer or Parent as a result of the transactions contemplated hereby.

(x)

All Business Personnel that participate in the development of Intellectual Property used by Company are bound by enforceable covenants requiring them to maintain secrecy of Company's and its Subsidiaries' confidential information.

(s)

Pension and Employee Benefits.

(i)

Section (s)(i) of the Company Disclosure Statement includes a complete list of all Employee Benefit Plans, health, welfare, supplemental unemployment benefit, bonus, pension, profit sharing, deferred compensation, deferred share unit plans and agreements, restricted share unit plans and agreements, stock option, stock compensation, stock purchase, retirement, hospitalization insurance, medical, dental, legal, disability and similar plans or arrangements or practices, whether written or oral, which are maintained by Company or any of its Subsidiaries, including all Employee Benefit Plans and Employment Agreements (collectively, the "Company Plans").

(ii)

To the knowledge of Company, no step has been taken, no event has occurred and no condition or circumstance exists that has resulted, or would reasonably be expected to result, in any Company Plan being ordered or required to be terminated or wound up in whole or in part or having its registration under applicable Law refused or revoked, or being placed under the administration of any trustee or receiver or Agency or being required to pay any material Taxes, penalties or levies under applicable Law.  There are no material actions, suits, claims (other than routine claims for payment of benefits in the ordinary course), trials, demands, investigations, arbitrations or other proceedings which are pending or, to Company's knowledge, threatened in respect of any of the Company Plans or their assets.

(iii)

For the past 3 years prior to the date hereof, all of the Company Plans are and have been operated and maintained in compliance in all material respects with all applicable Law and their terms; all contributions to the Company Plans have been made, withheld and remitted on a current basis, or the Accrued Liabilities for such funding obligations are properly disclosed in Company's financial statements.

(iv)

Except as set forth in Section (s)(iv) of the Company Disclosure Statement, none of the Company Plans is, nor does Company have any liability with respect to, a Multiemployer Plan, a plan subject to Title IV of ERISA, a multiple employer plan, a plan that provides health or welfare benefits to retirees, or a plan or arrangement that is not either exempt from, or in compliance with, section 409A of the Code or that provides for indemnification for or gross-up of any taxes thereunder.

(v)

Without limiting the generality of the foregoing with respect to each Company Plan:

(A)

Company has delivered or made available to Parent a true, correct and complete copy of: (1) each writing constituting a part of such Plan, including all plan documents, benefit schedules, trust agreements, and insurance contracts and other funding vehicles; (2) the 3 most recent Annual Reports (Form 5500 Series) and accompanying schedules, if any, (3) the current summary plan description and any material modifications thereto, if any (in each case, whether or not required to be furnished under ERISA); (4) the most recent annual financial report, if any; (5) the most recent actuarial report, if applicable; and (6) the most recent determination, opinion, or advisory letter from the United States Internal Revenue Service, if any.  Company has delivered or made available to Parent a true, complete and correct copy of each Employment Agreement.  Except as specifically provided in the foregoing documents delivered or made available to Parent, there are no amendments to any Company Plan or Employment Agreement that have been adopted or approved nor has Company or any of its Subsidiaries undertaken to make any such amendments or to adopt or approve any new Company Plan or Employment Agreement.

(B)

Section (s)(v)(B) of the Company Disclosure Statement identifies each Plan that is intended to be a "qualified plan" within the meaning of section 401(a) of the Code ("Qualified Plans").  With respect to each Qualified Plan, either: (1) the United States Internal Revenue Service has issued a favourable determination letter with respect to each Qualified Plan and the related trust that has not been revoked; or (2) such plan is entitled to rely upon an opinion or advisory letter issued by the United States Internal Revenue Service to a prototype plan sponsor, and there are no circumstances and no events have occurred that would adversely affect the qualified status of any Qualified Plan or the related trust.  Company has not at any time sponsored or maintained a plan intended to meet the requirements of section 501(c)(9) of the Code.

(C)

Section (s)(v)(C) of the Company Disclosure Statement sets forth a list of all Employee Benefit Plans and Employment Agreements under which the execution and delivery of this Agreement, Shareholder approval of the Transactions or the consummation of the Transactions would (either alone or in conjunction with any other event) result in, cause the accelerated vesting, funding or delivery of, or increase the amount of or value of, any payment or benefit to any employee, consultant, officer or director of Company or any of its Subsidiaries, or would limit the right of Company or any of its Subsidiaries to amend, merge, terminate or receive a reversion of assets from any Employee Benefit Plan or related trust or any Employment Agreement or related trust.  Except as disclosed in Section (s)(v)(C) of the Company Disclosure Statement, the execution and delivery of this Agreement, Shareholder approval of the Transactions or the consummation of the Transactions (either alone or in conjunction with any other event) will not result in any "excess parachute payment" within the meaning of section 280G of the Code.

(D)

Except as disclosed in Section (s)(v)(D) of the Company Disclosure Statement, there are no pending or, to the knowledge of Company, threatened material claims (other than claims for benefits in the ordinary course), lawsuits or arbitrations which have been asserted or instituted, and to Company's knowledge, no set of circumstances exists which may reasonably give rise to a claim or lawsuit, against the Company Plans, any fiduciaries thereof with respect to their duties to the Company Plans or the assets of any of the trusts under any of the Company Plans.  To the knowledge of Company, the Company Plans are not presently under audit or examination (nor has notice been received of a potential audit or examination) by the United States Internal Revenue Service, the Department of Labor, or any other governmental entity, domestic or foreign, and no matters are pending with respect to a Company Plan under the United States Internal Revenue Service's Employee Plans Compliance Resolution System (EPCRS), or other similar programs.

(E)

For the last 3 years prior to the date hereof, Company, its Subsidiaries and each member of their respective business enterprises has complied with WARN, so as not to incur any liabilities thereunder.

(F)

To the knowledge of Company, all Employee Benefit Plans subject to the Law of any jurisdiction outside of the United States (1) have been maintained in accordance with all applicable requirements, (2) if they are intended to qualify for special Tax treatment, meet all requirements for such treatment, and (3) all contributions have been made, withheld and remitted on a current basis.

(G)

Each individual who renders services to Company or any of its Subsidiaries who is classified by Company or such Subsidiary, as applicable, as having the status of an independent contractor or other non-employee status for any purpose (including for purposes of taxation and Tax reporting and under Employee Benefit Plans) is properly so characterized.

(H)

On or before the date hereof, Company has caused each grantor trust providing for funding of amounts payable pursuant to any Company Plans or Employment Agreements or both to be amended to ensure that no amounts are required to be contributed thereto as a result of the execution and delivery of this Agreement, the announcement hereof, or the announcement or consummation or both of the Transactions, and to ensure that such trusts are at all times revocable, in whole or in part, without the consent of the trustees or beneficiaries thereof or any third party.

(t)

Books and Records.  The financial books, records and accounts of Company and its Subsidiaries in all material respects, (i) are maintained in accordance with IFRS on a basis consistent with prior years, (ii) are stated in reasonable detail and accurately and fairly reflect the transactions and dispositions of the assets of Company and its Subsidiaries and (iii) accurately and fairly reflect the basis for Company consolidated financial statements.  Since July 31, 2010, the corporate minute books of Company and its Subsidiaries contain minutes of all meetings and resolutions of the directors and shareholders held up to and including June 2013.  Parent has been granted access to unredacted copies of such minute books of Company and its Subsidiaries, except for minutes of all meetings of the Special Committee of Company directors formed to consider the Transactions and the board of directors of Company in respect of the Transactions.  For purposes of clarity, such books and records that include sensitive information have been provided by Company to Parent in accordance with the terms and provisions of the Confidentiality Agreement. See Section (cc)(xiii) regarding sale, pricing, price reporting, etc. relating to pharmaceuticals, biologics, and medical devices.

(u)

Insurance.  Except as set forth in Section (u)(i) of the Company Disclosure Statement, Company has made available to Parent true, correct and complete copies of all material policies of insurance to which each of Company and its Subsidiaries are a party or are a beneficiary or named insured.  Except as set forth in Section (u)(ii) of the Company Disclosure Statement, Company and its Subsidiaries maintain insurance coverage with reputable insurers in such amounts and covering such risks as are in accordance with normal industry practice for companies engaged in businesses similar to that of Company and its Subsidiaries.  For insurance policies subject to premium audit, retroactive premium, or similar future premium obligation, Company has paid premiums in an amount that will, by the time of the Effective Date, not reasonably be expected to result in future premium due.  Except as disclosed in Section (u)(iii) of the Company Disclosure Statement, to the knowledge of Company, there is no material claim by Company or any of its Subsidiaries pending, under any insurance policy and to the knowledge of Company, no material claim made since July 31, 2013 has been denied.  No written notice of cancellation or termination has been received with respect to the insurance policies.

(v)

Litigation.  Except as specifically disclosed in Section (v) of the Company Disclosure Statement:

(i)

there is no claim, suit, action or proceeding which has been properly commenced against Company or to the knowledge of Company threatened against Company or any of its Subsidiaries or any of its or their properties or assets; to the knowledge of Company there are no circumstances that pose a material risk of a claim, suit, action or proceeding against Company or any of its Subsidiaries or any of its or their properties or assets, including for greater certainty any legal proceedings, whether judicial or administrative, in Canada, the United States or otherwise (i) seeking the recall, withdrawal, suspension or seizure of any Company Product, (ii) with respect to any alleged injuries to a participant in any clinical trial conducted by Company or any of its Subsidiaries or on behalf of Company or any of its Subsidiaries or otherwise, or (iii) with respect to any product liability claim relating to or arising out of Company Products, that, individually or in the aggregate, if adversely determined, could reasonably be expected to exceed $500,000 in damages;

(ii)

there is not any material judgement, decree, injunction, rule or order of any Agency or arbitrator outstanding against Company or any of its Subsidiaries; and

(iii)

during the 3 years prior to the date hereof, there has been no suit, action or proceeding served on, commenced against or threatened against Company or any of its Subsidiaries relating to products liability claims relating to or arising out of Company Products.  As of the date of this Agreement, except as specifically disclosed in Section (v) of the Company Disclosure Statement, there is no suit, action, proceeding pending or threatened against Company or any of its Subsidiaries that, individually or in the aggregate, if resolved adversely to Company, would reasonably be expected to prevent or delay in any material respect the consummation of the Transactions.

(w)

Determination by the Board and Voting Requirements.  The board of directors of Company (after receiving financial advice including the Fairness Opinion, legal advice and after considering other factors), by the unanimous vote of its directors, has determined and resolved at its meeting held on December 11, 2013:

(i)

that the entering into of this Agreement, the performance by Company of its obligations hereunder and the Transactions are in the best interests of Company;

(ii)

that the Arrangement is fair to Shareholders;

(iii)

to approve the Transactions and this Agreement; and

(iv)

to recommend that Shareholders approve the Arrangement.

(x)

Brokers; Schedule of Fees and Expenses.  Except as set forth in Section (x) of the Company Disclosure Statement, no broker, investment banker, financial advisor or other person is entitled to any broker's, finder's, financial advisor's or other similar fee or commission in connection with the Transactions based upon arrangements made by or on behalf of Company.  Company has made available to Parent true and complete copies of all agreements that are referred to in Section (x) of the Company Disclosure Statement, if any, and all indemnification and other agreements, if any, related to the engagement of the persons so listed.

(y)

Fairness Opinion of Financial Advisor.  Company has received the opinion of the Financial Advisor dated the date of this Agreement, to the effect that, as of such date, the Arrangement, and the consideration received thereunder is fair and reasonable to all securityholders affected by the Arrangement (other than members of the Apotex Group) from a financial point of view, a copy of which opinion will be promptly delivered to Parent.

(z)

Dispositions of Company Property.  Except for sales or disposals in the ordinary course of business and except as described in Section (z) of the Company Disclosure Statement and as disclosed in the Company Public Disclosure Documents, since July 31, 2013, neither Company nor any of its Subsidiaries has sold or disposed of or ceased to hold or own any personal property, real property, any royalty interest or interest in a joint venture or other assets or properties of Company or any of its Subsidiaries ("Company Property"), other than any interest or rights with respect to real property having an individual fair market value of less than $500,000 in the aggregate, in each case in the ordinary course of business, consistent with past practice.  Except as set forth in Section (z) of the Company Disclosure Statement, no Company Property, the fair market value of which on the date of this Agreement is greater than $250,000 in the aggregate, is subject to any pending sale or disposition transaction.

(aa)

Absence of Cease Trade Orders.  No order ceasing or suspending trading in Common Shares (or any of them) or any other securities of Company is outstanding and no proceedings for this purpose have been instituted or, to the knowledge of Company, are pending, contemplated or threatened.

(bb)

Environmental Matters.  To the knowledge of Company:

(i)

All biological materials utilized by Company and its Subsidiaries in the Business are used, maintained and stored in compliance in all material respects with applicable Environmental Laws.

(ii)

Company and each of its Subsidiaries are and, for the last 3 years prior to the date hereof, have been in compliance with all applicable Environmental Laws.

(iii)

No obligations or other liabilities for which Company or any of its Subsidiaries would be liable or responsible under Environmental Law presently exist with respect to any portion of any currently owned, leased, used or otherwise controlled property or operations of the Business.

(iv)

There are no facts or circumstances resulting from the operation of the Business that could reasonably be expected to result in material liability under Environmental Law.

(v)

Neither Company nor any of its Subsidiaries has received written inquiry or written notice from any Agency or any other person alleging a violation of or any liability under any Environmental Law which has not been fully and finally resolved and with respect to which there remains any continuing obligation or responsibility.

(vi)

Company has obtained, and is and, for the last 3 years prior to the date hereof, has been in compliance in all material respects with all material Environmental Permits; all material Environmental Permits are in full force and effect and are listed on Section (bb)(v) of the Company Disclosure Statement; and neither Company nor any of its Subsidiaries has received any written notices from any Agency or any other person concerning the termination, suspension or material modification of any Environmental Permit necessary for the operation of the Business.

(vii)

For the last 3 years prior to the date hereof, there has been no release of any Hazardous Materials at, on, under or from any facility currently owned, leased, operated or used by Company or any of its Subsidiaries, including the Specified Manufacturing Facilities which could reasonably be expected to give rise to any material liabilities pursuant to Environmental Laws;

(viii)

Except as set forth in Section (bb)(vii) of the Company Disclosure Statement, there are no underground storage tanks (UST) or UST systems, impoundments, or other units for the treatment, storage or disposal of Hazardous Materials located at the Winnipeg facilities.  No other USTs are present at any other real property currently owned by Company or any Subsidiary and no USTs were present while Company or any Subsidiary operated at any other real property formerly owned, leased, used or otherwise controlled by Company or any Subsidiary.

(ix)

Company has provided to Parent complete and accurate copies of all material environmental assessment, remediation and compliance reports pertaining to the Business or any real property currently or formerly owned, leased, operated, used or otherwise controlled by Company or any of its Subsidiaries within the possession or reasonable control of Company or any of its Subsidiaries.

(x)

For the past 3 years prior to the date hereof, none of Company or any of its Subsidiaries has expressly assumed or agreed to indemnify material and known liabilities of any other person arising under Environmental Law currently in effect.

(xi)

For the past 3 years prior to the date hereof, none of Company or any of its Subsidiaries has caused a release of Hazardous Materials at any location, nor has Company or any of its Subsidiaries arranged for the transportation, treatment or disposal of Hazardous Materials at or to any location that has been included in any published federal, state or local governmental list of sites that could reasonably be expected to give rise to material liabilities to Company or any of its Subsidiaries under Environmental Law.

(cc)

Regulatory Matters.  Except as disclosed in Section (cc) of the Company Disclosure Statement:

(i)

Except as set forth in Section (cc)(i) of the Company Disclosure Statement, for the past 3 years prior to the date hereof, neither Company nor any of its Subsidiaries has received any written notice or other communication from the Health Agencies of the US, Canada or Europe and any written notice from the Health Agencies of any other country alleging any material violation by Company or any of its Subsidiaries of any applicable Law within the jurisdiction of the Health Agencies, where any such violation has not been resolved or is not being resolved, including any failure to maintain systems and programs adequate to ensure compliance with any applicable Law.

(ii)

(A) To the knowledge of Company, except as set forth in Section (cc)(ii) of the Company Disclosure Statement, for the last 3 years prior to the date hereof, all pre-clinical and clinical trials and investigations upon which Company has relied or plans to rely as the basis for any submission to any Health Agency, to the extent conducted by Company or any of its Subsidiaries, have been and are being conducted in material compliance with the following, to the extent that any of the following are applicable to each pre-clinical or clinical trial or investigation; (A) the Health Agencies' standards for conducting non-clinical laboratory studies; (B) the International Conference on Harmonization E6: Good Clinical Practices Consolidated Guideline; and (C) the Health Agencies' regulations and guidelines for good clinical practices (GCP) and the design, conduct (including human subjects protection), performance, monitoring, auditing, recording, analysis and reporting of clinical trials.  (B) For the last 3 years prior to the date hereof, neither Company nor any of its Subsidiaries nor, to the knowledge of Company, anyone acting on behalf of Company or any of its Subsidiaries, has received any written notice that any Health Agency or any institutional review board or research ethics board has initiated, or materially threatened to initiate, any clinical hold or other action to suspend any clinical trial or suspend or terminate any IND, CTA, or any other equivalent thereof sponsored directly by Company or any of its Subsidiaries directly, and upon which Company or any of its Subsidiaries has relied or plans to rely as the basis for any submission to any Health Agency; provided, however, that Company has disclosed to Parent any adverse events arising out of any clinical trial or investigations upon which Company has not relied or does not plan to rely as the basis for any submission to any Health Agency, to the extent conducted by Company or any of its Subsidiaries.

(iii)

To the knowledge of Company, for the last 3 years prior to the date hereof, all pre-clinical tests sponsored by Company or any of its Subsidiaries performed in connection with or as the basis for any submission to any Health Agency, filed under a CTA, IND or other foreign equivalent or that Company or any of its Subsidiaries anticipates will be submitted to or held for inspection by any Health Agency have been conducted in accordance, in all material respects, with applicable good laboratory practice requirements as set forth in 21 C.F.R. Part 58 (but only to the extent that such nonclinical tests are required by 21 C.F.R. Part 58 to be conducted in accordance with good laboratory practice requirements).

(iv)

To the knowledge of Company, Company and its Subsidiaries have properly maintained in all material respects their respective books and records, including batch records, deviations, corrective and preventive actions in connection with all manufacturing by or on behalf of Company or any of its Subsidiaries for all Company Products.  For purposes of clarity, such books and records that include sensitive information have been provided by Company to Parent in accordance with the terms and provisions of the Confidentiality Agreement.  For the last 3 years prior to the date hereof, all manufacturing operations conducted by or for the benefit of Company or any of its Subsidiaries and over which Company or any of its Subsidiaries had direct manufacturing control, have been and are being conducted in accordance, in all material respects, with applicable current good manufacturing practices (GMPs), as prescribed pursuant to the FDCA and its implementing regulations and all similar applicable GMP standards imposed by Health Agencies with jurisdiction over Company's operations.

(v)

To the knowledge of Company, Company and its Subsidiaries have properly maintained (A) books and records setting forth any material oral or written communication received by Company or any of its Subsidiaries from any Health Agency in the last 3 years prior to the date hereof, including any and all reports of telephone conversations, visits and inspections, and any legally effective notice of intention to conduct an inspection (for purposes of clarity, such books and records that include sensitive information have been provided by Company to Parent in accordance with the terms and provisions of the Confidentiality Agreement), (B) books and records directly relating to clinical studies upon which Company or any of its Subsidiaries has relied or plans to rely as the basis for any submission to any Health Agency conducted by Company or any of its Subsidiaries or on behalf of Company or any of its Subsidiaries in the last 3 years prior to the date hereof (for purposes of clarity, such books and records that include sensitive information have been provided by Company to Parent in accordance with the terms and provisions of the Confidentiality Agreement), (C) all information required to be maintained about adverse drug experiences obtained or otherwise received by Company or any of its Subsidiaries from any reportable source, in Canada, the United States or outside the Canada and United States, including information derived from clinical investigations, pharmacovigilance reports in the scientific literature, and unpublished scientific papers, relating directly to any Company Product, and (D) all audit reports filed during the last 3 years prior to the date hereof relating to Company Products that are in its possession and are material to assessing compliance with all Law within the jurisdiction of the Health Agencies.  Except as set forth in Section (cc)(v) of the Company Disclosure Statement, for the past 3 years prior to the date hereof, neither Company nor any of its Subsidiaries has received any legally effective notices of inspectional observations (including those recorded on form FDA 483), establishment inspection reports, warning letters, untitled letters, or any other documents issued by any Health Agency that demonstrates lack of compliance with any applicable Law by Company or any of its Subsidiaries or by any entity acting on behalf of Company or any of its Subsidiaries, where any such compliance issue has not been or is not being resolved.

(vi)

As to each Company Product for which a biological license application, new drug application, or other regulatory application for marketing authorization was submitted by Company or any of its Subsidiaries, including outside of Canada and the United States, has been submitted, filed or approved, (A) Company and each of its Subsidiaries is in material compliance with the applicable Health Agency filing requirements, and all applicable Law, and all terms and conditions of such applications, to the extent applicable and (B) Section (cc)(vi) of the Company Disclosure Statement sets out all written commitments made to any Health Agency to undertake post-marketing requirements (i.e. Phase IV) with respect to such Company Product.

(vii)

For the last 3 years prior to the date hereof, none of Company or any of its Subsidiaries, nor any officer, employee or to the knowledge of Company, agent of Company or any of its Subsidiaries has been convicted of any crime or engaged in any conduct that would reasonably be expected to result in or that has resulted in, in the United States, debarment under 21 U.S.C. Section 335a, exclusion from federal or state health care programs, or any Law that materially would limit or impair the ability of Company to conduct its Business.

(viii)

To the knowledge of Company, neither Company nor any of its Subsidiaries currently is in material violation of any applicable Law or any lawful order, writ, injunction or decree of any Health Agency applicable to Company or any of its Subsidiaries or any Company Product.  All documentation, correspondence, reports, data, analysis and certifications relating to or regarding the Company Products filed or delivered (or, if amended, as of the date for which such amendment speaks) by or on its behalf to any Health Agency during the last 3 years prior to the date hereof were in all material respects when so filed or delivered, and to the extent required by any applicable laws remain true and accurate.

(ix)

To the knowledge of Company, Company has provided to Buyer and Parent true, complete and accurate copies of all advertising and promotional materials, programs and initiatives related to the use of the Company Products that Company or any of its Subsidiaries currently use, including medical education, symposia, opinion leader development, peer-to-peer development, publications, journal ads, and all other material written communications that describe the features or benefits of the Company Products (the "Existing Promotional Materials") created by or on behalf of Company or its Subsidiaries for 3 years prior to the date hereof.  The Existing Promotional Materials are in material compliance with applicable Law.  Each of Company's and its Subsidiaries' Standard Operating Procedures (SOPs) governing the sales and marketing of the Company Products are in material compliance with applicable Law.

(x)

To the knowledge of Company, except as disclosed in Section (cc)(x) of the Company Disclosure Statement, for the last 3 years prior to the date hereof, all billing practices, including discounts, price concession, and calculations or best price and average price, of Company and its Subsidiaries with respect to all third-party payors, including the Federal and State Healthcare Programs and private insurance companies, have been in compliance in all material respects with all applicable Law, regulations and policies of such third-party payors, private insurance companies and the Federal and State Healthcare Programs.  During the period of employment by Company or its Subsidiaries during the last 3 years prior to the date hereof, (A) no employee or any member of Company's or its Subsidiaries' medical staff or to the knowledge of Company, independent contractor of Company or its Subsidiaries (whether an individual or entity), has been excluded from participating in any federal health care program (as defined in 42 U.S.C. § 1320a-7b(f)) and (B) none of the officers, directors, managers, managing employees, or to the knowledge of Company agents (as such term is defined in 42 U.S.C. § 1320a-5(b)) of Company or its Subsidiaries have been excluded from Medicare or any federal health care program (as defined in 42 U.S.C. § 1320a-7b(f)) or been subject to sanction pursuant to 42 U.S.C. § 1320a-7a or 1320a-8 or been convicted of a crime described at 42 U.S.C. § 1320a-7b, nor is any such exclusion, sanction or conviction threatened or pending.  For the last 3 years prior to the date hereof, neither Company nor any of its Subsidiaries has been excluded from participating in any federal health care program (as defined in 42 U.S.C. § 1320a-7b(f)), nor is any such exclusion threatened or pending.  Neither Company nor its Subsidiaries have been convicted of a criminal offense related to the provision of health care services.

(xi)

To the knowledge of Company, Company and each of its Subsidiaries is in material compliance with all applicable registration and listing requirements with all Health Agencies.

(xii)

For the last 3 years prior to the date hereof, none of Company or any of its Subsidiaries or any officer, employee or agent of Company or any of its Subsidiaries has made a materially untrue statement of a material fact or fraudulent statement to any Health Agency, failed to disclose a material fact required to be disclosed to any Health Agency, or committed any act, made any statement, or where applicable, failed to make any statement, that would reasonably be expected to provide a basis for the FDA to invoke its policy respecting "Fraud, Untrue Statements of Material Fact, Bribery, and Illegal Gratuities", set forth in 56 Fed. Reg. 46191 (September 10, 1991) or any similar policy of any Health Agency.

(xiii)

Except as disclosed in Section (cc)(xiii) of the Company Disclosure Statement, to Company's knowledge, for the last 3 years prior to the date hereof, Company and its Subsidiaries have operated in all material respects in compliance with all Health Agency requirements relating to the sale, pricing, price reporting, government or private placement or reimbursement for, and rebates related to pharmaceuticals, biologics and medical devices.

(xiv)

Section (cc)(xiv) of the Company Disclosure Statement sets forth the Health Agency status of all Company Products, including CTAs, INDs, biological license applications, new drug applications, 510(k)s and other investigation or marketing authorization applications and the status of such application, whether pending, approved, denied, active or inactive.

(xv)

For the last 3 years prior to the date hereof, none of Company or any of its Subsidiaries has received any material written information from any Health Agency which would reasonably be expected, in the usual course of such dealings, to lead to the denial of any application for marketing approval currently pending before the Health Agency.

(xvi)

To Company's knowledge, Company has made available to Buyer material correspondence relating to post marketing requirements for Company's botulism antitoxin heptavalent.

(xvii)

Except as disclosed in Section (cc)(xvii) of the Company Disclosure Statement, all material reports, documents, claims, permits and notices required to be filed, maintained or furnished to any Health Agency by Company or any of its Subsidiaries during the last 3 years prior to the date hereof (including, for the avoidance of doubt, all required investigational status reports, postmarketing reports, and adverse event reports) have been so filed, maintained or furnished, except those reports, documents, claims, permits and notices currently in process.  All such reports, documents, claims, permits and notices were complete and accurate in all material respects on the date filed (or were corrected in or supplemented by a subsequent filing).  None of Company or any of its Subsidiaries or any officer, employee, agent or distributor of Company or any of its Subsidiaries is the subject of any pending, or threatened investigation in respect of Company, any of its Subsidiaries, or the Company Products by any Health Agency pursuant to the FDA's policy respecting "Fraud, Untrue Statements of Material Facts, Bribery, and Illegal Gratuities," set forth in 56 Fed. Reg. 46191 (September 10, 1991) or any similar policy of any Health Agency.  For the last 3 years prior to the date hereof, neither Company nor any of its Subsidiaries, nor any current officer, employee, agent or distributor of Company or any of its Subsidiaries, has been convicted of any crime or engaged in any conduct that could result in a material debarment mandated by 21 U.S.C. § 335a(a) or any similar Law or authorized by 21 U.S.C. § 335a(b) or any similar Law.

(xviii)

To Company's knowledge, except as set forth in Section (cc)(xviii) of the Company Disclosure Statement, the development, manufacture, testing, distribution, and marketing of each Company Product that is or has been developed, manufactured, tested, distributed or marketed, and remains currently available on the market or currently in development, is being, and has been for the last 3 years prior to the date hereof conducted in compliance in all material respects with the applicable provisions of the FDCA and the regulations of the FDA promulgated thereunder, the Food and Drugs Act (Canada) and, the CDSA and the respective regulations thereunder, or, to knowledge of Company, any similar Law applicable in any other jurisdiction in which such activities are carried out, including those relating to investigational use, premarket clearance or marketing approval, good manufacturing practices, good clinical practices, good laboratory practices, labeling, advertising, record keeping and filing of reports.  There is no action or proceeding pending or, to knowledge of Company, threatened by any Agency, including any prosecution, injunction, seizure, civil fine, suspension or recall, in each case alleging any material violation of any Law applicable to any Company Product by Company or any of its Subsidiaries.

(xix)

Except as disclosed in Section (cc)(xix) of the Company Disclosure Statement, to Company's knowledge, except as set forth in Section (cc)(xviii) of the Company Disclosure Statement, for the last 3 years prior to the date hereof, each of Company and its Subsidiaries have neither voluntarily nor involuntarily initiated, conducted or issued, or caused to be initiated, conducted or issued, any recall, field notifications, field corrections, market withdrawal or replacement, safety alert, warning, "dear doctor" letter, investigator notice, or other notice or action relating to an alleged lack of safety, efficacy or regulatory compliance of any Company Product, except as done in material compliance with applicable legal requirements.  Except for facts related to the topics set forth in Section (v), there are no facts which are reasonably likely to cause (A) the recall, market withdrawal or replacement of any Company Product currently sold by Company or any of its Subsidiaries, (B) a material change in the labeling of any such Company Products, or (C) a termination or suspension of the marketing of such Company Products.

(xx)

The last 3 years prior to the date hereof, neither Company nor any of its Subsidiaries has received any written notice that any Health Agency has commenced, or, to the knowledge of Company, threatened to initiate, any action to enjoin manufacture or distribution of any Company Product sold by Company or any of its Subsidiaries.

(xxi)

To the knowledge of Company, no Company Product currently manufactured or distributed by Company or any of its Subsidiaries is (A) adulterated within the meaning of 21 U.S.C. § 351 (or any similar Law) or (B) misbranded within the meaning of 21 U.S.C. § 352 (or any similar Law).

(xxii)

For the last 3 years prior to the date hereof, neither Company nor its Subsidiaries nor their employees or agents have engaged in activities that (A) would to Company's knowledge violate healthcare fraud and abuse laws (including the United States Anti-Kickback Statute, as amended, and the False Claims Act, as amended, and similar state Laws), or (B) that would violate anti-bribery and anti-corruption Laws in a way material to the Business.

(dd)

Reporting Issuer Status.  Company is a reporting issuer (or its equivalent) in each of the provinces of Canada.

(ee)

Related Party Transactions. None of Company or any of its Subsidiaries is indebted to any director, officer, employee or agent of, or consultant to, Company or any of its Subsidiaries or any of their respective affiliates or associates (except for amounts due as normal salaries, fees (including management and service fees) and bonuses and in reimbursement of ordinary expenses).  Except as set forth in Section (ee) of the Company Disclosure Statement, there are no loans, contracts or other transactions between Company or any of its Subsidiaries and any (i) director or officer of Company or any of its Subsidiaries; (ii) any holder of record or, to the knowledge of Company, beneficial owner of 5% or more of any class of the equity securities of Company; or (iii) any affiliate or associate of any such director, officer or beneficial owner.

(ff)

Disclosure Controls.  Company has designed such disclosure controls and procedures, or caused them to be designed under the supervision of its Chief Executive Officer and Chief Financial Officer, to provide reasonable assurance that material information relating to Company is made known to the Chief Executive Officer and Chief Financial Officer by others within Company and its Subsidiaries, particularly during the period in which the annual or interim financial statement filings are being prepared.

(gg)

Internal Controls.  Company has designed such internal controls over financial reporting, or caused them to be designed under the supervision of the Chief Executive Officer and Chief Financial Officer of Company, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with IFRS.  To the knowledge of Company and subject to the disclosure contained in Section (gg) of the Company Disclosure Statement, with respect to the 3 years prior to the date of this Agreement: (i) there are no significant deficiencies in the design or operation of, or material weaknesses in, the internal controls over financial reporting of Company that are reasonably likely to adversely affect Company's ability to record, process, summarize and report financial information, and (ii) there is and has been no fraud, whether or not material, involving management or any other employees who have a significant role in the internal control over financial reporting of Company.  To the knowledge of Company, for the last 3 years prior to the date hereof, Company has received no (A) material complaints from any source regarding accounting, internal accounting controls or auditing matters or (B) expressions of concern from employees of Company regarding questionable accounting or auditing matters.

(hh)

Competition Act. Assuming that the Effective Date is the date of this Agreement, Company together with its affiliates (as defined in the Competition Act) do not have: (i) assets in Canada that exceed CAN$295 million; or (ii) annual gross revenues from sales in, from or into Canada exceeding CAN$131 million, in either case, all as determined in accordance with Part IX of the Competition Act and the Notifiable Transactions Regulations thereunder, provided that, for the purposes of Section (b) of Schedule D, the assumption that the Effective Date is the date of this Agreement will not apply.

(ii)

Investment Canada Act.  Assuming that the Effective Date is the date of this Agreement, the value of the assets of Company together with its Subsidiaries, calculated in the manner prescribed by the Investment Canada Act, is less than CAN$344 million, provided that, for the purposes of Section (b) of Schedule D, the assumption that the Effective Date is the date of this Agreement will not apply.

(jj)

Listing.  The Common Shares are listed and posted for trading on the TSX.

(kk)

Compliance with Export Control, Trade, and Anti-Bribery Law.

(i)

Except as described in Section (kk)(i) of the Company Disclosure Statement, for the last 5 years prior to the date hereof, neither Company nor any of its Subsidiaries has violated the Arms Export Control Act (22 U.S.C. 2778), the ITAR, the Export Administration Regulations (15 C.F.R. 730 et seq.), regulations implemented by the Office of Foreign Assets Controls, United States Department of the Treasury (31 C.F.R. 500 et seq.), the Export and Imports Permit Act, the Special Economic Measures Act, the United Nations Act, the Freezing Assets of Corrupt Foreign Officials Act, the Defence Production Act, the Criminal Code or any regulations promulgated under the foregoing or any similar Law applicable in the United States, Canada, or elsewhere, relating to export controls and economic sanctions that are applicable to Company or its Subsidiaries (collectively, the "Export Control Laws").  During the last 5 years prior to the date hereof, Company has not received any written communication alleging that it is not in compliance with the Export Control Laws, and Company has not filed any voluntary disclosures of possible export violations relating to Company or its operations.  Neither Company, Company's Subsidiaries nor any of their officers or directors appears on the Specially Designated Nationals and Blocked Persons List of the Office of Foreign Assets Control of the United States Department of the Treasury, any listing of Designated Persons, terrorist or other entities  under the Special Economic Measures Act, the United Nations Act, the Freezing Assets of Corrupt Foreign Officials Act, or the Criminal Code or on any other similar list maintained pursuant to any authorizing statute, executive order or regulation.

(ii)

Except as described in Section (kk)(ii) of the Company Disclosure Statement, for the last 5 years prior to the date hereof, neither Company nor any of its Subsidiaries has had any direct or indirect dealings with a person or country with whom United States persons or persons in Canada or Canadians outside Canada are restricted from doing business under regulations of the Office of Foreign Asset Control (OFAC) of the United States Department of the Treasury (including those named on OFAC's Specially Designated Nationals and Blocked Persons List), the Export Control Laws, or under any Statute, Executive Order or any other governmental action that is applicable to Company or its Subsidiaries.

(iii)

For the last 5 years prior to the date hereof, neither Company nor any of its Subsidiaries, nor to their knowledge, any of their employees, officers, directors or agents, has directly or indirectly, paid, offered, given promised to give or authorized to give any money, gift, payment or anything of value in contravention of the Corruption of Foreign Public Officials Act (CFPOA) or to any "Foreign Official" as defined in the FCPA, public international organization as defined by the FCPA , political party, candidate for political office or other person (including any representative of any of the foregoing) for purposes of influencing or inducing any act or decision, or securing any improper advantage for Company in order to obtain or retain business for or with Company which (A) is prohibited by the FCPA or any other anti-corruption, anti-bribery or similar applicable Law or are reasonably expected to subject Company or any of its Subsidiaries to any damage or penalty in any action; (B) if not given in the past, are reasonably expected to have had an adverse effect on Company or any of its Subsidiaries as reflected in the financial statements of Company, (C) if not continued in the future, might adversely affect Company or any of its Subsidiaries, or (D) otherwise has the purpose or effect of public or commercial bribery, acceptance of or acquiescence in extortion, kickbacks or other unlawful or improper means of obtaining or retaining business or other unfair commercial advantage.  During the last 5 years there has been no action, suit, inquiry, investigation (including any internal investigation) or any other proceeding, including, to Company's knowledge, those threatened, involving Company, its Subsidiaries nor to their knowledge, any of their directors, officers, employees or agents, concerning compliance with the CFPOA, FCPA or any other applicable anti-corruption laws nor have any of the foregoing received any written communication alleging that they are not in compliance with, or that Company or any of its Subsidiaries is or has been the subject of any investigation by any governmental or regulatory agency concerning, the statutory and regulatory requirements under the CFPOA or FCPA.

(ll)

Government Contracts.

(i)

To the knowledge of Company, during the 3 years prior to the date hereof, no U.S. Government Contract was awarded pursuant to the Small Business Innovative Research (SBIR) program or on the basis of Company or its Subsidiaries having preferential status, including a small business, small disadvantaged business, 8(a), woman owned business status, and Company or its Subsidiaries have not represented to any customers that they hold such preferred bidder status as a condition of award.

(ii)

Section (ll)(ii) of the Company Disclosure Statement lists and separately identifies each contractor team arrangement as defined by FAR 9.601 to which any of Company or its Subsidiaries is a party and that has not terminated or expired (true and complete copies of which, including all modifications and amendments thereto, have been made available to Parent).  Each such contractor team arrangement is in full force and effect and is binding on Company or its Subsidiaries, as applicable, in accordance with its terms and, to the knowledge of Company, the other party or parties thereto, and no such contractor teaming arrangement is subject to any oral modifications or amendments.  To the knowledge of Company, during the 3 years prior to the date hereof, each of Company and its Subsidiaries has materially complied with all terms and conditions of each such contractor team arrangement.  To the knowledge of Company, there exist no disputes arising out of or relating to any such contractor team arrangement and that would reasonably be expected to have a Materially Adverse effect.

(iii)

During the 3 years prior to the date hereof, except as set forth in Section (ll)(iii) of the Company Disclosure Statement, with respect to each Government Contract and Government Bid:

(A)

To the knowledge of Company, each of Company and its Subsidiaries has materially complied with the terms and conditions of such Government Contract or Government Bid (including any agreements pertaining thereto and all applicable Law pertaining thereto, including all applicable government contract-related statutes, executive orders, and regulations (including the DFARS and FAR));

(B)

To the knowledge of Company, neither the United States Government nor any prime contractor, subcontractor, or Agency has notified Company or its Subsidiaries, either in writing or orally that Company or its Subsidiaries has breached a material contract requirement, certification, representation, clause, or provision, or otherwise materially violated any Law (including any Government Contract-or Government Bid-related statute, executive order, or regulation), in each case, pertaining to such Government Contract or Government Bid;

(C)

To the knowledge of Company and except for facts related to the topics set forth in Section (ll)(iii) of the Company Disclosure Statement, there are no facts that might give rise to or result in a claim by any Agency that Company or its Subsidiaries has breached a material contract requirement, certification, representation, clause, or provision, or otherwise violated any Law (including any Government Contract-related statue, executive order, or regulation), in each case, pertaining to such Government Contract;

(D)

no termination for convenience, termination for default, cure notice, or, show cause notice is currently in effect, has been issued and remains unresolved, or to the knowledge of Company, is expected with respect to such Government Contract;

(E)

To the knowledge of Company, no material cost incurred by Company or its Subsidiaries has been disallowed by any Agency or is the subject of any investigation by any Agency; and

(F)

No notice of criminal investigation or indictment has been received by Company or any of its Subsidiaries nor any of the persons set forth in Schedule 1.4(a). To the knowledge of Company neither Company, any of its Subsidiaries nor their respective Principals (as defined in FAR 52.209-5) is under criminal investigation or indictment

a)

is currently debarred, suspended, proposed for debarment, or declared ineligible for the award of a Government Contract or subcontract;

b)

has, within the 3 year period prior to the date hereof, been convicted of or had a civil judgment rendered against them for commission of fraud or a criminal offense in connection with obtaining, attempting to obtain, or performing a public (federal, state, or local) contract or subcontract, or violation of Antitrust Laws relating to the submission of offers, or commission of embezzlement, theft, forgery, bribery, falsification or destruction of records, making false statements, tax evasion, violating federal criminal tax laws, or receiving stolen property;

c)

is currently indicted for, or otherwise criminally or civilly charged by an Agency with, commission of any of the above-listed offenses.

(iv)

During the 3 years prior to the date hereof, except as set forth in Section (ll)(iv) of the Company Disclosure Statement, there (A) have been no and are no outstanding material claims or requests for equitable adjustment against Company or any of its Subsidiaries, either by any Agency or by any prime contractor, subcontractor, vendor, or other person, arising under or relating to any Government Contract or Government Bid and (B) are no outstanding and/or unresolved material disputes between Company or any of its Subsidiaries and the United States government under the Contract Disputes Act, as amended, or any other federal statute or between Company or any of its Subsidiaries and any prime contractor, subcontractor, vendor or any other person arising under or relating to any U.S. Government Contract or U.S. Government Bid.  During the 3 years prior to the date hereof, except as set forth in Section (ll)(iv) of the Company Disclosure Statement, Company and its Subsidiaries have no interest in any pending or potential material claim against any Agency or any prime contractor, subcontractor, or vendor arising under or relating to any Government Contract.

(v)

Section (ll)(v) of the Company Disclosure Statement sets forth a true and correct list of: (A) each Government Contract to which Company is a party and that is in effect as of the Effective Date (the "Assigned Contracts"); and (B) each Government Bid that is outstanding as of the Effective Date.

(vi)

To the knowledge of Company, during the 3 years prior to the date hereof, except as set forth on Section (ll)(vi) of the Company Disclosure Statement:

(A)

all material representations and certifications made by Company with respect each Government Contract and Government Bid (including but not limited to any certifications and/or representations made on or through the U.S. Government's SAM system) listed above in Section (ll)(v) of Company Disclosure Statement were complete and accurate as of their effective date and Company has materially complied and is in material compliance with all such representations and certifications;

(B)

other than pursuant to Government Contract requirements for withholding of fees under cost plus fixed fee Government Contracts, holdback payments related to licensure and labor withholdings under time and materials/labor hour Government Contracts, no money due to Company pertaining to any Government Contract or Government Bid listed above on Section (ll)(v) of the Company Disclosure Statement has been withheld or set off and is still outstanding nor has any claim been made to withhold or set off money that has not been or will be adequately reflected in the financial statements, and Company is entitled to all applicable progress payments received with respect thereto;

(C)

no stop work order or any other type of suspension of work has been issued with respect to any Government Contract or Government Bid listed above in Section (ll)(v) of Company Disclosure Statement and has not been resolved;

(D)

Company and its Subsidiaries have not received any written notice of any outstanding protests or complaints challenging the award of any Government Contract listed above in Section (ll)(v) of the Company Disclosure Statement;

(E)

there have not been any claims or equitable adjustments by Company or its Subsidiaries against any Agency or any prime contractor, higher or lower tier subcontractor or vendor arising under or relating to any Government Contract or Government Bid listed above in Section (ll)(v) of the Company Disclosure Statement in excess of $100,000;

(F)

Company has made available to Buyer materially complete and correct copies of Government Contracts and Government Bids listed above in Section (ll)(v) of the Company Disclosure Statement, including amendments, modifications, and task or delivery orders related thereto;

(G)

Company has not received any written notification from any Agency of any intention to make a material modification to any Government Contract listed above in Section (ll)(v) of the  Company Disclosure Statement for which no modification has been issued;

(H)

And except for facts related to the topics set forth in the Company Disclosure Statement referenced in Section (ll)(vii), there is no currently pending request and there are no facts that would reasonably be expected to give rise to or result in a request for an extension of Company's time for performance under any Government Contract listed above in Section (ll)(v), of the Company Disclosure Statement;

(I)

Company has all material authorizations and approvals from Agencies and all material third‑party certifications and approvals required in order to perform the work under each Government Contract listed above in Section (ll)(v) of Company Disclosure Statement, and has maintained compliance in all material respects with the terms on which such authorizations, certifications and approvals are conditioned;

(J)

There is no Government Contract (excluding Grants), for which the most recent estimated total costs of completion as estimated in good faith by Company indicate that such Government Contract will be completed without a profit to Company or its Subsidiaries, as applicable, (i.e. an estimation by Company or its Subsidiaries that Company's or its Subsidiaries' total cost of performance as reasonably calculated by Company and its Subsidiaries will exceed the total payments to Company and its Subsidiaries by the customer);

(vii)

Investigations/Audits.  During the 3 years prior to the date hereof, except as set forth on Section (ll)(vii) of the Company Disclosure Statement:

(A)

neither Company nor any of its Subsidiaries nor, to the knowledge of Company, any Principal is (or during the last 3 years prior to the date hereof has been) under administrative, civil or criminal investigation, indictment or writ of information by any Agency, or any non-routine audit or investigation by any Agency with respect to the Company's Government Contracts.

(B)

To the knowledge of Company, no such investigation, indictment, or writ or non-routine audit has been threatened.

(C)

Company has not conducted or initiated any internal investigation (other than inquiries in the ordinary course of business to ensure compliance with applicable Law) or made any voluntary or mandatory disclosure under FAR 52.203-13 to any Agency arising under or relating to a Government Contract or Government Bid. To the knowledge of Company, during the 3 years prior to the date hereof, except as set forth in Section (ll)(vii) of the Company Disclosure Statement, there exists no credible evidence requiring a mandatory disclosure under FAR 52.203-13 that has led or could lead to any material damage, penalty assessment, recoupment of payment or disallowance of cost.

(D)

there are no Company Products delivered under any Government Contract that are currently quarantined.

(viii)

If required under a Government Contract, Company has submitted to the responsible United States Government contracting officer and applicable Governmental Authorities incurred cost submissions for the years through July 31, 2012 and any open years are disclosed in Section (II)(viii) of the Company Disclosure Schedule.

(ix)

Cost or Pricing Data:  To the knowledge of Company, during the 3 years prior to the date hereof, except as set forth in Section (ll)(ix) of the Company Disclosure Statement, Company has not submitted to any Agency any materially inaccurate, incomplete or non-current cost or pricing data relating to a Government Contract or Government Bid.

(x)

Business Accounting Practices:  To the knowledge of Company, during the 3 years prior to the date hereof, except as set forth in Section (ll)(x) of the Company Disclosure Statement, Company's business accounting practices have been in compliance in all material respects with applicable Law and has not been determined to be inadequate for accumulating and billing costs under Government Contracts by any Agency.  Except as set forth in Section (ll)(x) of the Company Disclosure Statement, to the knowledge of Company, during the 3 years prior to the date hereof, there has been no, and there is no finding of fraud, defective pricing, mischarging or improper payments on the part of Company by any Agency.

(xi)

Security Obligations:  Except as disclosed in Section (ll)(xi) of the Company Disclosure Statement, to the knowledge of Company, during the 3 years prior to the date hereof, Company is in material compliance with all applicable security requirements and export control requirements, including applicable export or import permit requirements, in its Government Contracts.

(xii)

Government Furnished Property:  To the knowledge of Company, during the 3 years prior to the date hereof, except as set forth in Section (ll)(xii), of the Company Disclosure Statement, Company is in material compliance with U.S. Government furnished property requirements, including reporting requirements.

(xiii)

Organizational Conflicts of Interest: Company is in compliance with organizational conflicts of interest requirements in its Government Contracts and, to the knowledge of Company, is aware of no published and current open and available opportunity involving the U.S. Government from which Company or its Subsidiaries are currently limited, prohibited or otherwise restricted from performing or bidding due to organizational conflicts of interest in connection with any Government Contract.

(xiv)

Technical Data and Software Rights:

(A)

With respect to any "technical data" or "computer software" developed by Company "exclusively at private expense" or "at private expense" as those terms are defined in the FAR, DFARS, or in any Contract with an Agency (such applicable Contract definition, together with FAR and the DFARS, the "Data Regulations") in no case has any Agency or any other Person asserted a challenge, or expressed an intent to challenge, any of Company's rights in such technical data or computer software pursuant to the Data Regulations.

(B)

Company has taken all measures that are reasonable and customary for companies in similar lines of business to protect its rights in technical data and computer software under the Data Regulations.

(xv)

General Services Administration Federal Supply Schedule Contract Compliance:  To the knowledge of Company, during the 3 years prior to the date hereof, except as set forth in Section (ll)(xv) of Company Disclosure Statement, with respect to any General Services Administration Federal Supply Schedule Contract held by Company, Company has materially complied with all (A) "Industrial Funding Fee" obligations; and (B) "Price Reductions" clause obligations.

(xvi)

Inventions:  To the knowledge of Company, during the 3 years prior to the date hereof, Company has materially complied with all reporting requirements related to inventions under its Government Contracts; and, except as provided in Section (ll)(xvi) of the Company Disclosure Statement or as required by statute, no Agency or third party has any ownership or licensing rights in any inventions of Company.

(mm)

No Other Representations and Warranties.  EXCEPT AS EXPRESSLY SET FORTH IN THIS SCHEDULE E, COMPANY MAKES NO REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, AT LAW OR IN EQUITY, IN RESPECT OF COMPANY, ITS SUBSIDIARIES OR ANY OF THEIR RESPECTIVE ASSETS, LIABILITIES OR OPERATIONS, INCLUDING WITH RESPECT TO MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE, AND ANY SUCH OTHER REPRESENTATIONS OR WARRANTIES ARE HEREBY EXPRESSLY DISCLAIMED.  THE DISCLOSURE OF ANY MATTER OR ITEM IN ANY SCHEDULE HERETO WILL NOT BE DEEMED TO CONSTITUTE AN ACKNOWLEDGEMENT THAT ANY SUCH MATTER IS REQUIRED TO BE DISCLOSED.