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TABLE OF CONTENTS

SCHEDULE 14A
(RULE 14a-101)

INFORMATION REQUIRED IN PROXY STATEMENT

SCHEDULE 14A INFORMATION

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

Filed by the Registrant ý

Filed by a Party other than the Registrant o

Check the appropriate box:

o
 
Preliminary proxy statement

o
 
Confidential, for use of the Commission only (as permitted by Rule 14a-6(e)(2))

ý
 
Definitive proxy statement

o
 
Definitive additional materials

o
 
Soliciting material under Rule 14a-12

BOSTON BIOMEDICA, INC.
(Name of Registrant as Specified in Its Charter)

 
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
         
Payment of Filing Fee (check the appropriate box):

o
 
No fee required.

o
 
Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
    1)   Title of each class of securities to which transaction applies:
        
    2)   Aggregate number of securities to which transaction applies:
        
    3)   Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):
        
    4)   Proposed maximum aggregate value of transaction:
        
    5)   Total fee paid:
        

ý
 
Fee paid previously with preliminary materials.

o
 
Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.

 
 
1)
 
Amount Previously Paid:
        
    2)   Form, Schedule or Registration Statement No.:
        
    3)   Filing Party:
        
    4)   Date Filed:
        

GRAPHIC

BOSTON BIOMEDICA, INC.
375 West Street
West Bridgewater, Massachusetts 02379

NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD SEPTEMBER 14, 2004

        You are hereby given notice of and invited to attend in person or by proxy a special meeting of stockholders of Boston Biomedica, Inc. (the "Company") to be held at 375 West Street, West Bridgewater, Massachusetts 02379 on September 14, 2004, at 10:00 a.m., local time, for the following purposes:

        The board of directors has fixed the close of business on July 26, 2004, as the record date (the "Record Date") for the determination of stockholders entitled to notice of and to vote at the special meeting and any adjournments thereof. Only stockholders at the close of business on the Record Date are entitled to notice of and to vote at the special meeting.

        For the reasons set forth in the proxy statement, our board of directors unanimously recommends that you vote "FOR" Proposal Nos. 1, 2 and 3.

        Because the transactions contemplated by Proposal No. 1 involve the sale of substantially all of our assets, we have concluded that stockholders are entitled to assert appraisal rights under Chapter 156D, the Massachusetts Business Corporation Act, of the Massachusetts General Laws, provided that the stockholder strictly complies with the procedures in Chapter 156D, as described further in the accompanying proxy statement.

        You are cordially invited to attend the special meeting. However, whether or not you expect to attend the special meeting, it is very important for your shares to be represented at the meeting. We respectfully request that you promptly date, execute and mail the enclosed proxy in the enclosed stamped envelope for which no additional postage is required if mailed in the United States. A proxy may be revoked by a stockholder by notifying the Clerk of the Company in writing at any time before the vote at the special meeting, by executing and delivering a subsequent dated proxy and delivering it to the Company before the vote at the special meeting, or by personally appearing at the special meeting and casting your vote, each as specified in the enclosed proxy statement. YOUR VOTE IS IMPORTANT. PLEASE PROMPTLY EXECUTE AND RETURN THE ENCLOSED PROXY CARD IN THE ENVELOPE PROVIDED.

By Order of the Board of Directors:

Kathleen W. Benjamin, Clerk

Dated : August 13, 2004

West Bridgewater, Massachusetts


TABLE OF CONTENTS

        

 
   Page
Number
SUMMARY TERM SHEET   1
QUESTIONS AND ANSWERS ABOUT THE 2004 SPECIAL MEETING OF STOCKHOLDERS   11
GENERAL INFORMATION   16
  Voting Procedures   16
  Voting of Proxies   17
  Revocation of Proxies   17
  Persons Making the Solicitation   17
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS   18
PROPOSAL NO. 1—SALE OF OUR BBI CORE BUSINESSES   19
  The Companies   19
  Background of the Sale of our BBI Diagnostics and BBI Biotech Business Units   24
  Proceeds from the Sale of Assets   28
  Nature of Our Business Following the Sale to SeraCare   29
  Reasons for the Sale of our BBI Core Businesses to Seracare   29
  Recommendation of the Board of Directors   34
  Opinion of Financial Advisor   34
  Fairness Opinion Analysis   37
  Regulatory Approvals   39
  Appraisal Rights   40
  Tax Consequences   44
  Accounting Treatment of the Asset Sale   44
  Treatment of Employee Stock Options   45
  Risk Factors   46
ASSET PURCHASE AGREEMENT   52
  Assets Sold   52
  Assets Retained   53
  Assumed Liabilities   53
  Excluded Liabilities   54
  Closing Date   54
  Purchase Price; Escrow and Post-Closing Adjustment   54
  Additional Payments   55
  Representations and Warranties   55
  Covenants   57
  Solicitation; Withdrawal of Recommendation by Our Board of Directors   58
  Conditions to Closing   60
  Other Agreements Relating to the Asset Sale   61
  Indemnification   64
  Limits on Indemnification   64
  Termination of the Asset Purchase Agreement   65
  Effect of Termination   66
  Payment of Termination Fee   66
  Expenses   67
FINANCIAL HISTORY AND EFFECTS OF THE PROPOSED SALE TO SERACARE   68
  Unaudited Pro Forma Financial Information   69
  Vote Required and Board Recommendation   77
     

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PROPOSAL NO. 2—CORPORATE NAME CHANGE   77
  General   77
  Vote Required   77
PROPOSAL NO. 3   78
  Vote Required   78
STOCK OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT   78
PROPOSALS OF STOCKHOLDERS   80
OTHER MATTERS   80
ADDITIONAL INFORMATION   80
Appendix A    Asset Purchase Agreement    
Appendix B    Fairness Opinion    
Appendix C    Massachusetts Business Corporation Act, Ch. 156 D, Part 13—Appraisal Rights    
Appendix D    Voting Agreement between Richard T. Schumacher and SeraCare Life Sciences, Inc.    
Appendix E    Voting Agreement between Richard P. Kiphart, Shoreline Micro-Cap Fund I, LP and Rebecca S. Kiphart and SeraCare Life Sciences, Inc.    

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SUMMARY TERM SHEET

        This summary highlights the material terms of the proposed sale of assets of our BBI Diagnostics and BBI Biotech business units to SeraCare Life Sciences. This summary highlights selected information in this proxy statement and may not contain all of the information that may be important to you when evaluating the proposed transaction. To understand the proposed transaction fully and for a more complete description of the terms of the transaction, you should carefully read this proxy statement and the asset purchase agreement between us and SeraCare, a copy of which is attached to this proxy statement as Appendix A. We have included page references in this summary to direct you to a more complete discussion in the proxy statement.

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QUESTIONS AND ANSWERS ABOUT THE 2004 SPECIAL MEETING OF STOCKHOLDERS

Where and when is the special meeting of stockholders? (See page 16)

Who is soliciting my proxy? (See page 17)


Who is entitled to vote on the proposals? (See page 16)

What am I being asked to vote on?

What will happen if the sale to SeraCare is approved by our stockholders? (See page 29)

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Will any of the proceeds from the sale to SeraCare be distributed to me as a stockholder? (See page 28)

Will our common stock still be publicly traded if the sale to SeraCare is completed?

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What are the risks of the proposed sale to SeraCare? (See page 46)


What will happen if the sale to SeraCare is not approved by our stockholders or is otherwise not completed?

When is the sale to SeraCare expected to be completed?

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What vote is required to approve Proposal No. 1, the sale of the assets of our BBI Core Businesses to SeraCare as contemplated by the Asset Purchase Agreement?

What vote is required to approve Proposal No. 2, the amendment to our Restated Articles of Organization, as amended, to change our corporate name?

What vote is required to approve Proposal No. 3, the granting of discretionary authority to the persons named as proxies to adjourn the special meeting to solicit additional proxies in favor of Proposal Nos. 1 or 2?

Has any stockholder agreed to vote its shares of common stock in favor of Proposal No. 1, Proposal No. 2 or Proposal No. 3? (See page 63)

What do I need to do now?

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Can I change my vote after I have mailed my signed proxy? (See page 17)

If my shares are held in "street name" by my broker, will my broker vote my shares for me? (See page 17)

What happens if I do not indicate how to vote my proxy? (See page 17)


Who can help answer my questions about the proposals?

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GENERAL INFORMATION

Voting Procedures

        This proxy statement is being furnished in connection with the solicitation by the board of directors of Boston Biomedica, Inc., a Massachusetts corporation, of proxies to be voted at the special meeting of stockholders of Boston Biomedica, Inc. to be held at our principal executive offices located at 375 West Street, West Bridgewater, MA, on September 14, 2004, at 10:00 a.m., local time, and at any postponements or adjournments thereof. Only stockholders of record on July 26, 2004 (the "Record Date") will be entitled to vote at the special meeting. On the Record Date there were 6,853,646 outstanding shares of common stock. Each share of common stock outstanding on the record date is entitled to one vote on each matter to come before the special meeting.

        At the special meeting, stockholders will be asked to vote to (i) approve the sale of substantially all of our assets, which consist of the assets of our BBI Core Businesses, pursuant to the terms of an asset purchase agreement between us, BBI Biotech Research Laboratories and SeraCare Life Sciences dated April 16, 2004; (ii) approve an amendment to our Restated Articles of Organization, as amended, to change our corporate name to "Pressure BioSciences, Inc."; (iii) grant discretionary authority to the persons named as proxies to adjourn the special meeting to solicit additional proxies in favor of Proposal Nos. 1 or 2; and (iv) transact such other business as may properly come before the special meeting, as set forth in the notice of special meeting.

        A quorum, consisting of a majority of our shares of common stock issued, outstanding and entitled to vote at the special meeting, will be required to be present in person or by proxy for the transaction of business at the special meeting.

        The affirmative vote of the holders of two-thirds of our shares of common stock outstanding and entitled to vote at the special meeting is required to approve Proposal No. 1, the sale of our BBI Core Businesses to SeraCare pursuant to the asset purchase agreement, as described in this proxy statement. The affirmative vote of the holders of a majority of our shares of common stock outstanding and entitled to vote at the special meeting is required to approve Proposal No. 2, the amendment to our Restated Articles of Organization, as amended, to change our corporate name. The affirmative vote of the holders of a majority of shares of our common stock present, in person or by proxy, and entitled to vote at the special meeting, whether or not a quorum is present, is required to approve Proposal No. 3, to grant discretionary authority to the persons named as proxies to adjourn the special meeting to solicit additional proxies in favor of Proposal Nos. 1 or 2.

        Brokers who hold shares in street name for clients typically have the authority to vote on "routine" proposals when they have not received instructions from beneficial owners. However, absent specific instructions from the beneficial owner of the shares, brokers are not allowed to exercise their voting discretion on non-routine matters, such as the sale to SeraCare pursuant to the asset purchase agreement. Proxies submitted without a vote by the brokers on these non-routine matters are referred to as "broker non-votes." Abstentions and "broker non-votes" will be counted for the purpose of establishing a quorum at the special meeting. In addition, abstentions or "broker non-votes" will have the same effect as a vote against Proposal No. 1, the sale of our BBI Core Businesses to SeraCare pursuant to the asset purchase agreement, and Proposal No. 2, the amendment to our Restated Articles of Organization, as amended, to change our corporate name. Abstentions will have the same effect as a vote against Proposal No. 3, to grant discretionary authority to the persons named as proxies to vote in favor of any adjournments of the special meeting for the purpose of soliciting additional proxies, but "broker non-votes" will have no effect on Proposal No. 3. All votes will be tabulated by the inspector of election appointed for the special meeting, who will separately tabulate affirmative and negative votes, abstentions and broker non-votes.

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Voting of Proxies

        General.    Shares represented by a proxy will be voted at the special meeting as specified in the proxy.

        Proxies without voting instructions.    Proxies that are properly signed and dated but which do not contain voting instructions will be voted "for" each of the proposals.

        Voting shares held through broker by proxy.    If your shares of common stock are held by your broker, your broker will vote your shares for you if you provide instructions to your broker on how to vote your shares. You should follow the directions provided by your broker regarding how to instruct your broker to vote your shares. Your broker generally cannot vote your shares without specific instructions from you.

        Voting of shares held through broker in person.    If your shares of common stock are held by your broker and you wish to vote those shares in person at the special meeting, you must obtain from the nominee holding your shares a properly executed legal proxy, identifying you as a stockholder of our company, authorizing you to act on behalf of the nominee at the special meeting and specifying the number of shares with respect to which the authorization is granted.

        Other matters.    If you sign and return the enclosed proxy card, you grant to the persons named in the proxy the authority to vote in their discretion on any other matters that may properly come before the special meeting or any adjournments or postponements of the special meeting. Our management does not presently know of any other matters to be brought before the special meeting.

Revocation of Proxies

        Signing the enclosed proxy card will not prevent a record holder from voting in person at the special meeting or otherwise revoking the proxy. A record holder may revoke a proxy at any time before the special meeting in the following ways:

        Record holders should send any written notice of revocation or subsequent proxy to our corporate Clerk, c/o Boston Biomedica, Inc. 375 West Street, West Bridgewater, MA 02379 or hand deliver the notice of revocation or subsequent proxy to our corporate Clerk before the vote at the special meeting. No revocation will be effective unless and until notice of such revocation has been received by us at or prior to the special meeting

Persons Making the Solicitation

        The enclosed proxy is solicited on behalf of our board of directors. Our employees may participate in the solicitation but will not receive any separate or additional compensation in connection therewith. The cost of soliciting proxies in the accompanying form will be borne by us. Proxies may also be solicited personally or by telephone by our directors and officers, without additional compensation therefor. Upon request, we will reimburse brokers, dealers, banks and trustees or their nominees, for reasonable expenses incurred by them in forwarding proxy material to beneficial owners of shares of common stock.

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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

        Certain statements made in this proxy statement are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by terminology such as "may," "will," "should," "expects," "intends," "anticipates," "believes," "estimates," "predicts," or "continue" or the negative of these terms or other comparable terminology and include, without limitation, statements regarding: completion of the sale of our BBI Core Businesses to SeraCare; possible adjustments to the purchase price to be received from SeraCare for the BBI Core Businesses; potential indemnification payments relating to the sale to SeraCare; the proceeds remaining from the purchase price after the payment of taxes; the transaction costs incurred in the sale to SeraCare and the payment of unforeseen liabilities; management's projections; our plans following the closing, including our ability to operate our remaining business, our ability to sell our BBI Source Scientific business, our intent to commence an issuer tender offer, and our ability to remain as a public company, and the potential for commercial success of our pressure cycling technology business. These statements are based upon our current expectations, forecasts, and assumptions that are subject to risks, uncertainties and other factors that could cause actual outcomes and results to differ materially from those indicated by these forward-looking statements. These risks, uncertainties, and other factors include, but are not limited to: the ability to satisfy the conditions to closing, including, among others, our ability to obtain stockholder approval and SeraCare's receipt of sufficient financing to complete the transaction; the risk that the timing and amount of the tender offer purchase price may differ from what is presently anticipated or that the tender may not be able to be completed at all due to unanticipated events or other circumstances beyond our control, including unforeseen liabilities or contingencies reducing the amount of proceeds available for the tender offer; the risk that we may be unable to agree on a definitive agreement to sell the assets of our BBI Source Scientific business unit or otherwise complete the sale of those assets; the risk that we will not have sufficient funds to operate our remaining business following the closing; the risk that we may have liabilities and expenses arise which are currently unforeseen; the risk that the continuity of our operations will be disrupted in the event the proposed transactions do not close; the risk of unanticipated reactions of our customers and vendors to the proposed asset sale transactions; the costs of completing the other proposed transactions may exceed management's estimates; the competitive nature of the markets in which we operate; a change in economic conditions; our ability to retain existing customers and to obtain new customers; our ability to attract and retain qualified personnel; our ability to comply with the financial and other covenants contained in our revolving line of credit; and the other risks and uncertainties discussed under the heading "Risk Factors" in this proxy statement, our Annual Report on Form 10-K for the year ended December 31, 2003, as amended and other reports we file from time to time with the SEC. We undertake no obligation to update any of the information included in this proxy statement, except as otherwise required by law. Please note that the protections afforded to us under the Private Securities Litigation Reform Act of 1995 will not apply to forward looking statements that may be made in connection with our planned tender offer following the closing of the sale to SeraCare.

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PROPOSAL NO. 1—SALE OF OUR BBI CORE BUSINESSES

        This section of the proxy statement describes certain aspects of the sale of our BBI Diagnostics and BBI Biotech Research Laboratories business units. However, we recommend that you read carefully the complete asset purchase agreement for the precise terms of the agreement and other information that may be important to you. The asset purchase agreement is included in this proxy statement as Appendix A.

The Companies

        We are engaged in the business of providing products and services to help ensure the accuracy of laboratory test results for infectious diseases such as AIDS and viral hepatitis. Our operations currently consist of the following business units: BBI Diagnostics, BBI Biotech Research Laboratories, and Pressure Cycling Technology ("PCT"). A brief summary of our business operations is described below. For a more detailed description of our business, please review the "Business" section contained in Item 1 of our Annual Report on Form 10-K, as amended by Amendment No. 1 to Form 10-K for the fiscal year ended December 31, 2003, a copy of which is attached as an appendix to this proxy statement and is incorporated herein.

        Our BBI Diagnostics business unit offers a broad array of diagnostic products for in vitro diagnostic use, consisting of Quality Control Panels, Accurun® External Run Controls and ACCUCHART™ quality control software, and Diagnostic Components, all used in connection with infectious disease testing.

        Our Quality Control Panels and Accurun External Run Controls are comprised of a number of human blood plasma samples contained in sealed vials or test tubes. The plasma is supplied in either liquid or frozen state, and is known to contain (positive) or not contain (negative) specific levels of certain viruses or antibody relating to the following: Human Immunodeficiency Virus (HIV), Hepatitis B Virus (HBV), Hepatitis C Virus (HCV), Lyme Disease bacterium, and West Nile Virus.

        Our Quality Control Products are used throughout the entire life cycle of an infectious disease test kit. The life cycle of an in vitro diagnostic test kit involves a number of stages. These stages include, research, development, clinical trials for regulatory approval, quality assurance release of each lot of manufactured product, validation testing of the test kit by customers, training customers how to use the test kit, ongoing-proficiency testing of lab personnel who use the test kit, and routine quality control testing each time the test kit is used to determine a patient result.

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        A description of our quality control products, including the use of and the customers for these products is as follows:

Product Line
   Description
   Use
   Customers
Seroconversion Panels   Rare plasma samples collected from a single individual over a specific time period showing conversion from negative to positive for markers of an infectious disease.   Compare the clinical sensitivity of competing manufacturers' test kits, enabling the user to assess the specificity and sensitivity of a test in detecting a developing antigen/antibody, or presence of pathogen nucleic acid.   Test kit manufacturers and regulators and researchers.

Performance Panels
 
A set of 10 to 50 serum and plasma samples collected from many different individuals and characterized for the presence or absence of a particular disease marker.
 
Determine test kit performance against all expected levels of reactivities in the evaluation of new, modified and improved test methods.
 
Test kit manufacturers, clinical laboratories that evaluated test kits, and regulators.

Sensitivity Panels
 
Precise dilutions of human plasma or serum containing a known amount of an infectious disease marker as calibrated against international standards.
 
Evaluate the linearity and low-end analytical sensitivity of a test kit.
 
Test kit manufacturers, regulators and researchers.

Qualification Panels
 
Dilutions of human plasma or serum manifesting a full range of reactivity in test kits for a specific marker.
 
Demonstrate the consistent lot-to-lot performance of test kits, troubleshoot problems, evaluate proficiency, and train laboratory technicians.
 
Clinical reference laboratories, blood banks, and hospital laboratories.

OEM Panels
 
Custom-designed Qualification Panels for regulators and test kit manufacturers for distribution to customers or for internal use.
 
Train laboratory personnel on new test kits or equipment.
 
Custom designed with test kit manufacturers and regulators as an end-user product or for internal use.

Verification Panels
 
Verification Panels contain naturally occurring undiluted samples at varying titers.
 
Verify accuracy and ensure that reagents perform to expectations: also used to troubleshoot system problems and to document problem resolution.
 
Clinical reference laboratories, blood banks, hospital laboratories.

        We perform extensive laboratory testing on each sample contained in our Quality Control Products before they are released for sale. The data on these samples are generated on a variety of test kits from many different manufacturers to determine the level and specificity of the infectious disease

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indicators that are present in the product, and to show the performance of each test kit on the BBI product. These data are then compiled on a spreadsheet that accompanies the sale of the BBI quality control product. Our Quality Control Panels, which combine the human blood specimens with this comprehensive quantitative data useful for comparative analysis, help ensure that test kits are as specific, reproducible, and sensitive as possible.

        Our Accurun® External Run Controls enable end-users of test kits to confirm the validity of results by monitoring test performance, thereby minimizing false negative test results and improving error detection. Our ACCUCHART quality control software is a software data management program for Quality Control Products customers. In addition, we provide Diagnostic Components, which are custom-processed human plasma and serum products, to test kit manufacturers. We also recently introduced our first test kit, a Lyme Disease Western Blot test kit. Our Lyme Western Blot Test Kit, which is manufactured by our BBI Biotech facility in Gaithersburg, Maryland and marketed by our BBI Diagnostics sales and marketing group in West Bridgewater, Massachusetts, tests for the presence of Lyme Disease.

        BBI Biotech Research Laboratories, Inc., a wholly-owned subsidiary of Boston Biomedica, is our research and development "arm", assisting in the development of new products and services for our other business units, such as the development of Accurun nucleic acid controls, and molecular and cellular biology quality control panels and by offering basic and esoteric nucleic acid and protein testing for our BBI Diagnostics business unit. BBI Biotech also developed the BBI IgM and IgG Borrelia burgdorferi Western Blot Test Kit, initially for use at BBI Clinical Laboratories. BBI Biotech seeks to obtain government grants and other research support wherever possible to help fund the cost of this research and development.

        Our BBI Biotech business unit provides repository services for various branches of the United States government and the National Institutes of Health ("NIH"), and specialty reagents and molecular and cellular biology services for laboratories and test kit manufacturers. Our repository stores more than 11 million human blood and tissue specimens, including plasma, serum, blood cells, and tissues. These specimens are used in government sponsored programs for the study of cancer, infectious diseases, and genetic diseases, in clinical studies of disease diagnostics, and in studies of how well vaccines and therapeutics work. BBI Biotech also provides a variety of research services in molecular biology, cell biology, virology and immunology to governmental agencies, diagnostic test kit manufacturers and biomedical researchers. Molecular biology services include DNA extractions and sequencing, genotyping, DNA library construction and screening and development of custom nucleic acid amplification assays. Cell biology and immunology services include sterility testing, virus infectivity assays, cultivations of virus or bacteria from clinical specimens, preparation of viral or bacterial antigens and custom western blot assays.

        As previously announced, on June 2, 2004, we completed the sale of substantially all of the assets and selected liabilities of our BBI Source Scientific business unit to a newly formed limited liability company jointly owned 70% by Mr. Richard W. Henson and Mr. Bruce A. Sargeant and 30% by BBI. Mr. Henson and Mr. Sargeant are medical instrument executives with many years of experience in the instrumentation field. Our BBI Source Scientific business unit designed, developed, manufactured and marketed laboratory instruments, primarily consisting of readers and washers and other small medical devices. By way of background, laboratories that test blood samples for diagnostic or research purposes often use test kits purchased from in vitro diagnostic manufacturers. These test kits can be prepared in a number of formats; currently, one leading format is to have the test performed in a plastic micro titer plate that contains 96 distinct wells (8 rows across, 12 columns down). Each well is used to test one sample. To perform the test, the patient sample and certain reagents are placed in each well. After a period of incubation time, the sample/reagents must be removed from the wells and new reagents are dispensed into them. A washer is an instrument that is used to remove—or wash—the well clean of the liquid that is in it. After the test has been completed, the plate of 96 wells must be

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put into an instrument that is used to detect colors (which are used to indicate the presence or absence of a disease market) that remain in the well after test completion. This instrument that detects color is called a reader.

        The laboratory instruments designed, developed, manufactured and marketed by BBI Source Scientific are used in hospitals and clinics, and in research, environmental and wine and food testing laboratories. Built with a common hardware technology platform, these instruments are used in connection with the performance of an in-vitro diagnostics test, including reading the test result. Our pressure cycling technology products were produced at the BBI Source Scientific production facility. BBI Source Scientific also served as a contract manufacturer of analytical instruments and biomedical devices. In connection with the sale of BBI Source Scientific, in addition to receiving a 30% ownership interest in the newly formed limited liability company, we received secured promissory notes in the principal amount of $900,000, which, together with accrued interest, are due on or before May 31, 2007. The aggregate principal amount of the notes may be reduced to $720,000 if the notes are paid in full by May 31, 2005 or $810,000 if the notes are paid in full by May 31, 2006. The notes are secured by pledges of the purchasers' ownership interests. The new instrumentation company has agreed to provide engineering, manufacturing, and other related services for our pressure cycling technology products until September 30, 2005. Although we currently own a 30% ownership interest in the newly formed entity that will continue to own and operate the BBI Source Scientific laboratory instrumentation business, this interest may decline if and to the extent that the entity issues equity in connection with financings, to employees for incentive compensation or otherwise.

        Our pressure cycling technology business unit involves research, development and commercialization of products utilizing our patented pressure cycling technology. Pressure cycling technology uses an instrument that we developed capable of cycling pressure between low and high levels to rapidly, reversibly, and repeatedly control the interactions of biomolecules. The pressure cycling technology utilizes our Barocycler™ instrument and disposable PULSE™Tubes to release nucleic acids and biologically active proteins from plant and animal cells and tissues, as well as other organisms, which are not easily disrupted by standard chemical and physical methods. Nucleic acid is a general term that includes DNA (deoxyribonucleic acid) and RNA (ribonucleic acid). Together, DNA and RNA constitute the genetic material of all living things including bacteria, plants, animals, and viruses. Genetic material or genes are the basic unit of heredity, thus are responsible for the characteristics of an organism. In general, an organism uses DNA to make RNA and RNA to make protein. Proteins are the building blocks of life. To fully understand the characteristics of an organism, whether as simple as bacteria, or as complex as a human, scientists must examine its nucleic acids and proteins. To do this, scientists must first release the nucleic acids from the organism's cells so that the nucleic acids can be studied. In addition, scientists must also be able to obtain proteins from tissues to understand how the protein functions in the organism. The study of nucleic acids and proteins is called genomics and proteomics, respectively. It is important for scientists to have a method to release nucleic acids and proteins from cells and tissues in sufficient quantity and quality to study and test these molecules. Pressure Cycling Technology (PCT) is such a method. Once nucleic acids and proteins are released by PCT, scientists can then use the released material in a broad range of applications such as identifying a disease causing bacteria or the response of a human to drug therapy. Thus, we believe that PCT has applications in many diverse fields including agriculture, bio-defense, drug discovery, and disease diagnostics.

        In September 2002, we released for sale a floor model Barocycler™ instrument and disposable PULSE™ Tubes, the first products manufactured that utilize our pressure cycling technology. The PCT business unit, which has received both private and public (National Institutes of Health) funding of segment research, has experienced and continues to experience lower than expected product sales since September 2002 primarily associated with a longer than expected selling cycle. As of December 31, 2003, we have invested approximately $11.0 million in the development of our pressure cycling

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technology since 1997, with the funds coming from both internal and public sources. To date we have leased one and sold only two pressure cycling technology systems and a limited number of PULSE Tubes, and have generated approximately $106,000 of product revenue. We believe that sales of our pressure cycling technology products have been adversely affected primarily as a result of the longer than anticipated sales cycle associated with these products. Factors associated with this sales cycle include the initial selling price of the Barocycler™ and the limited amount of research data presently available demonstrating its capabilities and potential. To address this longer sales cycle, we have been developing a less expensive and smaller, bench top version of the Barocycler which we expect will facilitate an easier and quicker purchase decision by potential customers. We introduced a prototype of the bench top Barocycler in March 2004, which we expect will be available for commercial sale in the third or fourth quarter of 2004.

        We currently maintain a 4.45% passive ownership interest in Panacos Pharmaceuticals, Inc. Panacos Pharmaceuticals is engaged in the discovery and development of small molecule, orally available drugs for the treatment of HIV and other major human viral diseases. Panacos Pharmaceuticals' proprietary discovery technologies focus on novel targets in the virus life cycle, including virus fusion and virus maturation, the first and last steps of viral infection. On June 2, 2004, Panacos Pharmaceuticals announced that it entered into a definitive merger agreement with V.I. Technologies, a publicly traded company based in Watertown, Massachusetts, that develops innovative anti-infective technologies to enhance blood safety. Under the terms of that proposed transaction, V.I. Technologies is expected to issue 25 million common shares in exchange for all outstanding Panacos Pharmaceuticals shares upon the close of the transaction. In addition, V.I. Technologies is expected to issue up to an additional 20 million common shares to shareholders of Panacos Pharmaceuticals upon the successful completion of near-term clinical milestones for PA-457, a novel HIV drug currently in Phase 1 clinical trials. The transaction is expected to close in the third quarter of 2004 and is subject to SEC review and shareholder approval of both companies.

        If the transactions contemplated by the asset purchase agreement with SeraCare are completed, we will sell the assets of our BBI Diagnostics and BBI Biotech Research Laboratories business units and our remaining business operations following the completion of the transactions will consist primarily of our pressure cycling technology operations. In addition to our remaining pressure cycling technology business, we will continue to own a 30% ownership interest in the newly formed limited liability company that purchased our BBI Source Scientific business unit, and our 4.45% passive ownership interest in Panacos Pharmaceuticals.

        The principal executive offices for Boston Biomedica and BBI Biotech Research Laboratories are located at 375 West Street, West Bridgewater, MA 02379 and the telephone number is (508) 580-1900.

        SeraCare is a manufacturer and marketer of human and animal based diagnostic, therapeutic, and research products based in Oceanside, California, with a satellite office in Hatboro, Pennsylvania, and distributors in Europe and South Korea. SeraCare is a vendor-approved supplier to over 500 pharmaceutical and healthcare companies, and is listed as an exclusive supplier in many customers' regulatory filings with the Food and Drug Administration. SeraCare's primary focus is the development and sale of human and animal blood-based diagnostic, therapeutic, and research products to domestic and international customers. Through its strategic alliances with Biomat USA, Inc. and other suppliers, SeraCare has access to a nationwide network of donor centers. This has historically provided the basis for SeraCare's development of human plasma-based products and services. Through SeraCare's strategic alliance with Proliant, Inc., it has access to bovine serum albumin, which has provided the basis for its development of bovine serum-based products. SeraCare also provides antibody-based products, which are used as active ingredients in therapeutic products (generally, drugs used to treat and manage diseases) and in diagnostic products (generally, diagnostic tests and test kits).

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        SeraCare focuses on product development, the solidification of customer relationships, and improvement of its operational systems in California and Pennsylvania. SeraCare has increased the variety, and improved the quality, of products that it manufactures and sells. Management of SeraCare believes its strategy will aid its long-term success in the highly regulated and competitive industry in which it operates. During the course of SeraCare's corporate evolution, it has helped many customers develop internal protocols and standards, established quality control benchmarks, and has performed various other value-added services for its customers in order to establish solid relationships. SeraCare has made significant progress as a major supplier of protein and media products to several pharmaceutical and biotechnology companies.

        The principal executive offices for SeraCare Life Sciences are located at 1935 Avenida del Oro, Suite F, Oceanside, California 92056 and its telephone number is (760) 806-8922.

Background of the Sale of our BBI Diagnostics and BBI Biotech Business Units

        In 2002 and 2003, we continued to pursue a strategy of using our scientific capabilities in microbiology, immunology, virology, and molecular biology in an attempt to (1) expand the end-user market for our quality control products, especially the molecular testing market, (2) develop new products and services, (3) enhance our technical leadership, and (4) capitalize on complementary business operations.

        During 2002 and to a lesser extent in 2003, we also continued to expend significant resources on the research and development of our pressure cycling technology products. As a result of these efforts, in September 2002, we released for sale the Barocycler™ NEP2017 instrument and disposable PULSE™ Tubes, our first manufactured products which utilize our patented pressure cycling technology. These efforts, however, diverted a significant amount of our attention and resources away from our BBI Core Businesses. We recognized that to further develop and grow our BBI Core Businesses, while at the same time contributing sufficient resources to further develop and commercialize our pressure cycling technology products and services, we would need to raise additional capital or seek other strategic alternatives. Accordingly, on October 25, 2002, we retained William Blair & Company, LLC ("William Blair"), an investment banking firm, to advise us in the evaluation of strategic opportunities aimed at increasing shareholder value and liquidity by increasing the capital needed for our growth.

        In November and December 2002, we worked with William Blair and prepared a confidential offering memorandum to be presented to prospective partners. While the confidential offering memorandum was being prepared, our company engaged in preliminary discussions with two different parties that expressed interest in a possible transaction with us. The interest expressed by these two parties was discussed with our board of directors. Our board of directors determined that we would maintain an open dialogue with these two parties, but continue to identify other potentially interested parties. In January 2003, William Blair completed the confidential offering memorandum and began initiating contact with potential partners, including SeraCare and another party that had expressed interest in November and December 2002.

        On January 25, 2003, at a special meeting of the board of directors, William Blair reported to the board that it had contacted a total of 16 potential candidates. William Blair informed our board that most of these potential candidates were familiar with our operations. These potential partners also indicated that their primary interest was in our BBI Core Businesses and not in our remaining activities related to our pressure cycling technology or laboratory instruments. At this meeting, William Blair reviewed with us various transaction structures, including an asset sale for cash, an asset sale for stock, and a stock sale for cash. William Blair also analyzed the potential impact of each of these transaction structures on our company and our stockholders. Lastly, the board determined that William Blair should conduct further meetings and negotiations with the potential partners that indicated significant interest in a transaction with our company.

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        Between January 7, 2003 and February 24, 2003, we received indications of interest from three parties, including draft letters of intent from two of the three parties. Two of these parties proposed structures and consideration determined by our board of directors to be inadequate. The third party submitted a draft letter of intent dated January 31, 2003 which provided for the purchase of the assets of our BBI Core Businesses. On February 14, 2003, the board of directors reviewed this draft letter of intent and authorized our management to continue negotiating with this third party. On February 24, 2003, after further negotiations, we executed a letter of intent to sell the assets of our BBI Core Businesses to this third party.

        Between February 24, 2003 and May 2003, the third party conducted legal and business due diligence with respect to our BBI Core Businesses. During this diligence period, the third party revised their assessment of the BBI Core Businesses, and on June 6, 2003 delivered a revised letter of intent with a reduced purchase price. From that date through early July, we continued to negotiate and work with that party to modify the terms of the original letter of intent to reach a mutually satisfactory understanding of the terms of a proposed transaction. On July 3, 2003 we executed the revised letter of intent. The revised letter of intent provided for an exclusivity period until September 30, 2003. During this time and continuing through December 2003, we delivered additional due diligence materials, negotiated the terms of an asset purchase agreement, exchanged drafts of an asset purchase agreement and engaged in numerous meetings and conference calls relating to these matters and the possible transaction generally.

        In October 2003, the completion of an asset purchase agreement with this third party was proceeding slower than we expected and the exclusivity period in the letter of intent had recently expired. In the opinion of management and our board of directors, it was becoming increasingly likely that we would be unable to reach a final agreement on terms satisfactory to us. As a result, in November 2003, we began to reevaluate our strategic options with respect to a possible transaction.

        On November 11, 2003, a special meeting of our board of directors was held by teleconference. All of the members of our board of directors, representatives from Brown Rudnick Berlack Israels LLP ("Brown Rudnick"), our legal counsel, and representatives of William Blair, our investment bankers, were present on the conference call. During the meeting, the board of directors discussed the status of the negotiations with the third party. After further discussions, given that the exclusivity period in the letter of intent with the third party had expired and the negotiations with this third party had been proceeding slower than we expected, our board authorized William Blair to discuss a potential transaction with third parties that may contact William Blair. Mr. Schumacher reported to the board that on October 31, 2003, he had discussions with representatives of SeraCare about having further discussions regarding a possible transaction. Following further discussion, the board authorized William Blair to call Mr. Barry Plost, Chairman of SeraCare, to determine SeraCare's interested in pursuing further negotiations.

        In December 2003, following our inability to resolve a number of business and legal issues with the third party, including a disagreement on the purchase price, the portion of the purchase price to be held in escrow and several other matters, the parties put the transaction on hold and we continued to evaluate our strategic options.

        In December 2003, we continued discussions with SeraCare regarding a possible transaction and provided them with further information regarding our business. Throughout December 2003 and through April 2004, our board held numerous meetings to discuss the proposed transaction with SeraCare, all of which were held by telephone conference call.

        On December 11, 2003, all of the members of our board of directors and representatives of William Blair met to discuss the status of the negotiations with SeraCare. At this meeting, Mr. Schumacher updated the board on the status of recent discussions between him, William Blair and

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SeraCare. Following this report, the board instructed William Blair to contact SeraCare and discuss initiating further due diligence.

        On December 30, 2003, our full board met again with our counsel to discuss the due diligence process, including the scheduled site visits by SeraCare during the week of January 5, 2004.

        On January 8, 2004, all of the members of our board of directors, including our newest member of the board, Donald Payne who was appointed as a director on January 2, 2004, met to discuss the results of SeraCare's due diligence and site visits that were completed earlier that week. At this meeting, Mr. Schumacher and Mr. Quinlan reported to the board that Mr. Plost reaffirmed his earlier statement that SeraCare was not interested in purchasing any assets other than the assets of our BBI Core Businesses.

        On January 20, 2004, SeraCare submitted a non-binding letter of intent to acquire our BBI Core Businesses for $30 million in cash, which was greater than the purchase price offered by the other third party.

        On January 21, 2004, all of the members of our board of directors, other than Mr. Thomas Vogel, who was appointed as a director on January 9, 2004, and representatives of Brown Rudnick and William Blair, met to discuss the non-binding letter of intent received from SeraCare on January 20, 2004. The board had an extended discussion on certain significant business issues, including employee retention, escrow amount, exclusivity period and SeraCare's ability to raise funds required to complete the proposed transaction. After further discussion, the board instructed William Blair to discuss these issues with Mr. Barry Plost of SeraCare.

        On January 23, 2004, all of the members of the board of directors and a representative of Brown Rudnick met to discuss further SeraCare's proposed letter of intent. At this meeting, counsel to the company advised the board of the benefits of having an independent committee of directors review and consider the proposed transaction with SeraCare. The board agreed with counsel's recommendation and after further discussion, the board requested that our Audit Committee, which consists of four independent directors, meet independently to discuss the proposed transaction with SeraCare.

        On January 28, 2004, all of the members of the board of directors and representatives of Brown Rudnick and William Blair, met to review and discuss further the proposed letter of intent and William Blair's report to the board on recent discussions with SeraCare. Following this report, the board requested that William Blair contact SeraCare to discuss further certain business issues contained in the proposed letter of intent.

        On January 30, 2004, all of the members of the board of directors and representatives of Brown Rudnick and William Blair met to review and discuss the latest version of the proposed letter of intent. The version of the proposed letter of intent presented to the board included changes we requested to be included in the letter of intent. Following further discussions, the board voted unanimously to authorize Mr. Wayne Fritzsche to execute and deliver the letter of intent on behalf of our company.

        On February 3, 2004, we entered into an exclusive, non-binding letter of intent with SeraCare to negotiate an asset purchase agreement to sell the assets of our BBI Core Businesses.

        After the execution of the letter of intent with SeraCare, our board of directors continued to meet formally by telephone conference call and informally on almost a weekly basis to review and discuss SeraCare's proposal, the status of our negotiations and the operations of our business generally. Between February 3, 2004 and April 16, 2004, there were numerous informal meetings and telephone discussions involving representatives of our company, William Blair, our legal counsel, and representatives of SeraCare and its legal counsel. The purpose of these discussions was to assist SeraCare in completing its due diligence and to negotiate and finalize the details of the asset purchase agreement, the schedules to the asset purchase agreement, the various ancillary agreements

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contemplated by the asset purchase agreement and generally to continue to progress towards execution of definitive agreements.

        On February 5, 2004, all of the members of the board of directors met to discuss the timetable for the proposed transaction.

        On February 26, 2004, all of the members of the board of directors and representatives of Brown Rudnick met to discuss Mr. Wayne Fritzsche's report to the full board regarding a meeting he had with Mr. Richard P. Kiphart, a principal stockholder of our company. Mr. Fritzsche reported that he had met with Mr. Kiphart to discuss the proposed transaction with SeraCare, subject to an appropriate agreement by Mr. Kiphart to maintain the confidentiality of these discussions. Mr. Kiphart indicated that, based on the information he was provided, he was in favor of the deal discussed with him.

        On March 15, 2004, all of the members of the board and a representative of Brown Rudnick met to discuss the process for evaluating the fairness opinion being requested from William Blair. Legal counsel recommended that the board, including our Audit Committee, thoroughly assess and review the analysis to be performed by William Blair and the actual results of the fairness opinion prior to approving the proposed transaction with SeraCare. The board concurred with this approach.

        On March 19, 2004, Mr. Schumacher and representatives of Brown Rudnick, on behalf of the company, and SeraCare and representatives of O'Melveny & Myers, on behalf of SeraCare, had a conference call to review and negotiate the significant issues relating to the asset purchase agreement.

        On March 23, 2004, all of the members of the board and a representative of Brown Rudnick met to discuss the progress of and the results of the lengthy negotiations the parties had on the draft asset purchase agreement on March 19, 2004. Mr. Schumacher reported to the board that the meeting went well and that he was optimistic that an agreement could be reached soon.

        On April 1, 2004, our board of directors and representatives of Brown Rudnick and William Blair met to review the status of the SeraCare proposal and negotiations. At that meeting William Blair reported to the board its preliminary views regarding the fairness, from a financial point of view, of the potential transaction to our company. William Blair reviewed with the board the results of its investigation and research that formed the basis of its preliminary views. The board also discussed the uses of proceeds from the sale of the BBI Core Businesses to SeraCare, which included using a portion of the proceeds to engage in an issuer tender offer promptly after the closing of the sale to SeraCare and the remaining portion of the proceeds to provide working capital for our pressure cycling technology activities.

        After the meeting held on April 1, 2004, our board of directors continued to meet on a regular basis and discussed the terms of the proposed transaction and various strategic alternatives to the sale of the BBI Core Businesses. The discussions of potential strategic alternatives included remaining as an independent company pursuing our historical business, selling or spinning off our pressure cycling technology business and refocusing our efforts on our BBI Core Businesses, securing a strategic partner for our pressure cycling technology operations and continuing to pursue the sale of the BBI Core Businesses. The board also requested and received reports and various projections from management and discussed these reports and projections with management for the purpose of assisting in the board's determination of whether or not to approve the sale to SeraCare.

        On April 5, 2004, at a special meeting of our Audit Committee held by teleconference, in which all members of the Audit Committee and representatives of Brown Rudnick and William Blair were present, our Audit Committee further discussed the proposed transaction and the fairness of the proposed transaction to the company and our stockholders.

        On April 8, 2004, all of the members of the board, Michael Avallone, our chief financial officer, and representatives of Brown Rudnick met to discuss a financial analysis of the proposed transaction

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with SeraCare. The board discussed the use of proceeds from the transaction and cash remaining for our remaining pressure cycling technology operations, including a discussion on taxes and the transaction costs, the amount of capital believed to be necessary to capitalize our pressure cycling technology operations, the amount of cash we expected to have on hand after the closing, and the amount of proceeds from the sale of the BBI Core Businesses that our board desired to allocate to purchase shares of our common stock from our stockholders in an issuer tender offer following the closing of the sale to SeraCare. After further discussion, our board agreed that, at this point in time, if the transaction with SeraCare was completed, shortly following the closing of the sale to SeraCare we would commence a tender offer to purchase up to 6,000,000 shares of our common stock at a purchase price of $3.50 per share.

        On each of April 9, 2004 and April 12, 2004, all of the independent members of our board and, in the case of the meeting held on April 9, 2004, representatives of Brown Rudnick, met to discuss the status of the proposed transaction with SeraCare, strategic alternatives available to the company and the fairness of the transaction.

        On April 15, 2004, at a meeting of our board of directors, our legal counsel updated the board on the status of the transaction and the final negotiations with SeraCare. At that meeting, William Blair gave a presentation to the board regarding the fairness, from a financial point of view, of the consideration to be received by us under the terms of the asset purchase agreement contemplated by the latest draft as of that date, and delivered an oral opinion to the effect that the consideration to be received by us, was, from a financial point of view, fair to our company. William Blair later confirmed its oral opinion in writing with an opinion letter dated as of April 16, 2004. See Appendix B for a copy of this letter.

        On April 16, 2004, our board met again in the morning with our legal counsel and, after carefully evaluating the proposed transaction with SeraCare and taking into account all of the factors previously discussed and considered by the board, the board (including each of the independent directors) unanimously approved the sale of the BBI Core Businesses to SeraCare. In making its determination, the board considered the cash to be received, the overall structure of the transaction, the consideration to be paid for the assets being purchased and the liabilities being assumed, the terms of the asset purchase agreement and the numerous factors and considerations discussed in the section entitled "Reasons for the Sale of our BBI Core Businesses." The board of directors also unanimously resolved to recommend that our stockholders approve the asset purchase agreement and the sale of the assets of our BBI Core Businesses and the transactions contemplated by the asset purchase agreement.

        On April 15, 2004 and April 16, 2004 until the execution of the definitive asset purchase agreement, SeraCare and its legal counsel continued their due diligence efforts. During this time, our management, representatives of William Blair and our legal counsel and SeraCare and its legal counsel participated in a series of negotiations and discussions finalizing the terms of the asset purchase agreement and the other related agreements and responding to due diligence inquiries. These negotiations largely covered the provisions related to finalizing the terms of the ancillary agreements, completing the schedules to the asset purchase agreement, and clarifying certain issues related to the assets of the BBI Core Businesses. The changes made to the asset purchase agreement during this time were not material and did not alter the consideration to be received from the version of the asset purchase agreement circulated to the board on April 15, 2004. The asset purchase agreement was executed on April 16, 2004 and we announced the execution of the asset purchase agreement that same day.

        SeraCare will pay us approximately $30 million in cash for the assets of our BBI Core Businesses, subject to a post-closing adjustment described below. At the closing, $2.5 million of the purchase price

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will be deposited into an escrow account to be held in escrow by an independent escrow agent for a period of 18 months following the closing in order to secure our indemnification obligations to SeraCare under the asset purchase agreement. At the end of the 18 month period, any remaining amounts in the escrow account, after payment of any indemnification claims to date, will be payable to us, subject to any then pending claims. We will receive $27.5 million plus or minus any adjustment amount based on a target net asset value (as defined in the asset purchase agreement) of $8.5 million. As of April 30, 2004, we estimated that our net asset value was approximately $9.0 million. We estimate that we will pay between approximately $4.0 and $4.4 million in federal and state taxes as a result of the sale to SeraCare. We also estimate that our expenses in connection with the sale to SeraCare will be approximately $1.2 million, and we estimate approximately an additional $800,000 of other transaction related costs will be paid in connection with the transaction.

        We will retain the proceeds from the sale of our BBI Core Businesses to SeraCare. Shortly following the completion of the proposed transaction, we plan to commence an issuer tender offer to purchase for cash up to 6,000,000 shares of our common stock at a price of $3.50 per share. We will use up to $21.0 million of the after-tax net cash proceeds from the sale to SeraCare to purchase shares of our common stock tendered in the tender offer.

        Assuming that all 6,000,000 shares are tendered in the contemplated tender offer, we expect to have approximately $1.0 to $1.5 million remaining to fund our working capital for our pressure cycling technology activities. This amount consists of approximately $1.0 million of cash on hand as of April 30, 2004 (which is not part of the assets being purchased by SeraCare) and the remaining net proceeds from the sale, after taxes and transaction fees. In addition, any portion of the escrowed amount released to us is also expected to be used primarily for working capital for our pressure cycling technology activities. If less than 6,000,000 shares of our common stock are tendered in the tender offer, after-tax net cash proceeds from the sale of the BBI Core Businesses allocated for the tender offer which remain after the tender offer are expected to be used to provide additional working capital for our remaining pressure cycling technology operations. If you decide not to tender your shares in the tender offer, you will continue to be a stockholder in our company; however, trading in our common stock will likely be more difficult due to, among other things, limited trading volume of our stock. You should be aware that although we expect to commence the tender offer shortly following the closing, it is possible that we will not commence the tender offer or the cash payment we expect to offer could be substantially less than we currently anticipate due to unanticipated events or circumstances beyond our control or unforeseen liabilities or contingencies.

        Our board of directors has determined that our strategic direction will focus on further developing and growing our pressure cycling technology operations following the completion of the sale to SeraCare. Although we may explore opportunities to acquire, invest in, expand or develop new lines of business, to date our board has determined to focus primarily on this pressure cycling technology strategic direction for our company. Following the closing of the proposed transaction, our operations will consist primarily of our pressure cycling technology business. In addition to our remaining pressure cycling technology business, we will continue to own a 30% ownership interest in the newly formed limited liability company that recently purchased our BBI Source Scientific assets, and our 4.45% passive ownership interest in Panacos Pharmaceuticals, Inc.

        In reaching its determination to approve the sale to SeraCare, the asset purchase agreement and related agreements, our board of directors consulted with our management and our financial and legal advisors, and considered a number of factors. We are proposing to sell our BBI Core Businesses to SeraCare because we believe that the sale and the terms of the related asset purchase agreement are in

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the best interests of our company and our stockholders. In reaching its determination to sell the BBI Core Businesses, our board of directors considered a number of factors, including those described below:

        Operating History and Financial Condition.    Our board of directors considered the current and historical financial condition and results of operations of the BBI Core Businesses, as well as our strategic objectives, the growth potential of our BBI Core Businesses and the financial resources necessary to achieve the growth potential, the commercialization of and potential growth of our pressure cycling technology product platform and the capital necessary to fund further development and commercialization, and the current and historical financial condition and results of operations of our BBI Source Scientific business unit and the potential sale of assets of BBI Source Scientific. Our board considered the fact that during much of the last six years, we funded our pressure cycling technology activities through internally generated funds from our BBI Core Businesses and, to a lesser extent, from NIH grants. The board also considered the fact that internal funding of our pressure cycling technology operations limited our ability to invest in our BBI Core Businesses. Our board believes that future research and development costs and sales and marketing costs for our pressure cycling technology business, if funded internally from our BBI Core Businesses, will continue to limit the potential of our BBI Core Businesses. We also believe that to grow our BBI Core Businesses we will need additional funds, which may be difficult to obtain given an increasingly competitive market while continuing to fund our pressure cycling technology operations. Based on the foregoing, our board of directors concluded that we should focus on either the BBI Core Businesses or our pressure cycling technology business due to, among other things, the limited availability of funds and our limited access to capital, as well as the resources and management time required to develop each of these businesses, both of which involve different markets, products and customers.

        Strategic Alternatives.    The decision of our board of directors to approve and recommend the sale of our BBI Core Businesses was the result of an extended evaluation process. During the last two years, our board and senior management have, from time to time, evaluated and considered a number of alternatives. Among these were:

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        After careful consideration and consultation with financial industry experts and other professionals, our board of directors decided that stockholders were likely to benefit most if we were to successfully pursue the sale of the BBI Core Businesses to SeraCare.

        Our board of directors has identified various benefits that are likely to result from the sale of our BBI Core Businesses to SeraCare pursuant to the asset purchase agreement. The board believes the sale of these businesses will:

        The amount of cash we receive will vary, depending on some future contingencies, and is described under "Asset Purchase Agreement; Purchase Price; Escrow and Post-Closing Adjustment".

        In arriving at its determination that the sale to SeraCare is in the best interests of our company and our stockholders, the board of directors carefully considered the terms of the asset purchase agreement as well as the potential impact of the sale on our company. As part of this process, the board of directors considered the advice and assistance of its outside financial advisors and legal counsel. In determining to authorize the sale to SeraCare, the board of directors considered the benefits and factors set forth above as well as the following factors:

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        Our board also considered the numerous risks associated with either engaging in the proposed sale to SeraCare or failing to engage in the proposed sale, as further described below under the heading "Risk Factors—Special Considerations You Should Take into Account in Deciding How to Vote on the Proposal to Sell Our BBI Core Businesses to SeraCare." These risks, which should be considered by you in determining how to vote for this proposal, include the following:

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        The foregoing discussion of the information and factors considered by our board of directors is not intended to be exhaustive, but does include the material factors considered. In view of the complexity and wide variety of information and factors, both positive and negative, considered by the board, it is not practical to quantify, rank, or otherwise assign relative or specific weights to the factors considered. In addition, the board did not reach any specific conclusion with respect to each of the factors considered, or any aspect of any particular factor. Instead, the board conducted an overall analysis of the factors described above, including discussions with management and legal, financial and accounting advisors. In considering the factors described above, individual members of the board may have given different weight to different factors. The board considered all of these factors in totality and concluded, on the whole, such factors supported its determination to approve the sale to SeraCare. After taking into consideration all of the factors set forth above, our board of directors, following consultation with its legal and financial advisors, concluded that the sale to SeraCare is fair to, and in the best interests of, our company and our stockholders, and that we should proceed with the sale.

        The board of directors has determined that the sale of our BBI Core Businesses to SeraCare is fair to, and in the best interests of, our company and our stockholders. The board of directors unanimously approved the asset purchase agreement and the proposed sale contemplated thereby, and unanimously recommends that the stockholders vote in favor of the proposal to sell the assets of our BBI Core Businesses to SeraCare, pursuant to the asset purchase agreement, including the transactions contemplated thereby.

        We retained the firm of William Blair & Company, LLC to advise us in the evaluation of strategic opportunities aimed at increasing shareholder value. As part of its engagement, we requested William Blair to render a fairness opinion relating to the consideration to be received by our company in connection with the proposed sale to SeraCare. We selected William Blair based on their principals' qualifications and expertise, including the fact that William Blair's principals have significant experience in the valuation of businesses in connection with mergers and acquisitions, public and private financings and other transactions. William Blair is an investment bank based in Illinois, and as part of its investment banking practice, advises companies on mergers, acquisitions, and similar transactions. William Blair is actively engaged in the investment banking business and regularly undertakes the valuation of businesses and their securities in connection with private placements, business combinations and similar transactions.

        At a meeting of our board of directors on April 15, 2004, William Blair delivered its oral opinion, and subsequently confirmed in writing in an opinion dated April 16, 2004, that, as of such date and based upon and subject to the assumptions and other matters described in its written opinion and

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described below, the proposed consideration to be received by us in the sale to SeraCare was fair, from a financial point of view, to our company.

        As described in its opinion, William Blair assumed and relied upon the accuracy and completeness of all information examined or otherwise reviewed or discussed with William Blair. William Blair did not make or obtain an independent appraisal of the purchased assets or assumed liabilities (contingent or otherwise) of our BBI Core Businesses or of any of our other assets or liabilities or of our solvency. With respect to financial forecasts and projections prepared by our management, William Blair relied upon the assurances of our management that such forecasts and projections were reasonably prepared on bases reflecting the best currently available estimates and judgments of our management. William Blair relied upon each party to advise it promptly if any information previously provided or discussed with William Blair became inaccurate or was required to be updated during the period of its review. We did not impose any limitations on William Blair with respect to the investigations made or procedures followed by it in connection with the rendering of its opinion.

        In performing its analyses, William Blair also made numerous assumptions with respect to industry performance, general business, economic and regulatory conditions and other matters, many of which are beyond our control. The analyses performed by William Blair are not necessarily indicative of actual values, trading values or actual future results, which might be achieved, all of which may be significantly more or less favorable than suggested by such analyses. Such analyses were prepared solely as part of William Blair's analysis of the fairness of the financial terms and conditions of the transaction from a financial point of view and were provided to our board of directors. The analyses do not purport to be appraisals or to reflect the prices at which businesses or securities might be sold. In addition, the opinion of William Blair was one of many factors taken into consideration by the board of directors in making its determination to approve the transaction. Consequently, the analyses described below should not be viewed as determinative of the opinion of the board of directors' with respect to the value of our BBI Core Businesses.

        William Blair's opinion is addressed to the board of directors and is directed only to the fairness, from a financial point of view, of the consideration to be received by us pursuant to the asset purchase agreement and not to the merits of the underlying business decision to effect the sale to SeraCare, the structure or tax consequences of the asset purchase agreement, the availability or advisability of any alternatives to the sale of the BBI Core Businesses, or any potential issuer tender offer to be engaged in by us following the closing. William Blair's opinion does not constitute a recommendation that our company approve and consummate the asset purchase agreement nor does it constitute a recommendation to any stockholder as to how that stockholder should vote at the special meeting.

        The complete text of William Blair's opinion, which sets forth the assumptions made, matters considered and limitations on and scope of the review undertaken by William Blair, is attached to this proxy statement as Appendix B, and the summary of William Blair's opinion set forth in this document is qualified in its entirety by reference to its written opinion. Stockholders are urged to read William Blair's opinion carefully and in its entirety for a description of the procedures followed, the factors considered and the assumptions made by William Blair.

        In arriving at its opinion, William Blair took into account general economic, market and financial conditions as well as its experience in connection with similar transactions and valuations generally. In addition, among other things, William Blair reviewed and considered:

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        William Blair discussed the above considerations with members of our senior management on several occasions between the signing of the non-binding letter of intent with Seracare on February 3, 2004, and the execution of the definitive asset purchase agreement on April 16, 2004. These discussions were conducted primarily with Richard T. Schumacher, our Chief Executive Officer, Kevin W. Quinlan, President and Chief Operating Officer, and Michael Avallone, Vice President and Chief Financial Officer. During these discussions, we informed William Blair of the details of the asset purchase agreement and responded to William Blair's due diligence inquiries regarding the operations of our business, our historical financial results, and the financial forecasts and projections for our BBI Core Businesses prepared by our management team.

        William Blair did not express any opinion as to the price at which our common stock would trade at any future time. Those trading prices could be affected by a number of factors, including but not limited to:

        The opinion was based on market, economic, financial and other circumstances and conditions existing and disclosed to William Blair as of April 16, 2004, and although subsequent developments could affect its opinion, William Blair expressly disclaimed any obligation to update, revise or reaffirm their opinion. In rendering its opinion, William Blair assumed that the sale to SeraCare would be consummated on the terms described in the asset purchase agreement, without any waiver of material terms and conditions by us and without giving effect to any adjustments to the total consideration which may be contemplated pursuant to the asset purchase agreement.

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        Based on this information, William Blair performed a variety of financial analyses of the proposed sale to SeraCare and the consideration to be received by us in connection therewith. The following paragraphs summarize the material financial analyses performed by William Blair in arriving at its opinion.

        The following is a summary of the analyses performed by William Blair in connection with the preparation of the opinion. This summary is not a complete description of the analyses underlying the opinion. William Blair's opinion regarding the fairness of the consideration to be received by us was not based on any one analysis or any particular subset of these analyses but rather gave consideration to all of the analyses taken as a whole.

        Comparable Public Company Analysis.    William Blair reviewed and compared certain financial information relating to the BBI Core Businesses to corresponding financial information, ratios and public market multiples for certain publicly traded companies. William Blair selected publicly traded companies in the diagnostics and controls industries with equity market values less than $250.0 million that engaged in businesses reasonably comparable to those of our BBI Core Businesses. The companies selected by William Blair were BioSource International, Inc., Cholestech Corporation, Discovery Partners International, Inc., Meridian Diagnostics, Inc. and Trinity Biotech plc.

        None of the selected companies is identical to our business. Accordingly, any analysis of the selected publicly traded companies necessarily involved complex considerations and judgments concerning the differences in financial and operating characteristics and other factors that would necessarily affect the analysis of trading multiples of the selected publicly traded companies.

        Among the information William Blair considered was revenue; earnings before interest, taxes, depreciation and amortization (commonly referred to as "EBITDA") and earnings before interest and taxes (commonly referred to as "EBIT"). William Blair analyzed the selected companies in terms of the enterprise value as a multiple of revenue, EBITDA and EBIT. Enterprise value is calculated as equity market value, plus book value of debt, less cash and cash equivalents and is significant because it represents the overall value of an entity. The operating results and the corresponding derived multiples for the BBI Core Businesses and each of the selected companies were based on each company's most recent available publicly disclosed financial information for the last 12 months ("LTM"). In addition, William Blair was provided additional information by our management team regarding the BBI Core Businesses for the time period detailed above that was not publicly available. The closing share price for the comparable public companies used in the analysis was as of April 14, 2004. The enterprise value of the transaction for the BBI Core Businesses was $30.0 million.

        William Blair then compared the implied transaction multiples for the BBI Core Businesses to the range of trading multiples for the selected companies. Information regarding the multiples from William Blair's analysis of selected publicly traded companies is set forth in the following table.

 
    
   Selected Public Company
Valuation Multiples
  
 
   Implied
Transaction
Multiples
  
 
   Minimum
   Median
   Mean
   Maximum
  
Enterprise Value/LTM Revenue   1.38 x 1.38 x 2.07 x 2.02 x 2.64 x
Enterprise Value/LTM EBITDA   12.7x   9.7x   12.0x   12.8x   17.5x  
Enterprise Value/LTM EBIT   22.9x   12.6x   16.3x   15.6x   17.9x  

        Comparable Transactions Analysis.    William Blair analyzed similar business combinations announced and closed since 1997 in the diagnostics and controls industries with equity market values less than $250.0 million, in which the target company engaged in businesses reasonably comparable to those of our BBI Core Businesses. In total, William Blair examined 11 transactions that had publicly

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available information. The transactions were chosen based on William Blair's judgment that they were generally similar, in whole or in part, to the proposed sale of our BBI Core Businesses to SeraCare. The selected transactions were not intended to be representative of the entire range of possible transactions in the industry. The 11 transactions examined were (target/acquirer):

        Although William Blair analyzed the multiples implied by the selected transactions and compared them to the implied transaction multiples of the sale of the BBI Core Businesses, none of these transactions or associated companies is identical to the sale of the BBI Core Businesses. Accordingly, any analysis of the selected transactions necessarily involved complex considerations and judgments concerning the differences in financial and operating characteristics, parties involved and terms of their transactions and other factors that would necessarily affect the implied value of the BBI Core Businesses versus the values of the companies in the selected transactions.

        William Blair reviewed the consideration paid in the selected transactions in terms of the enterprise value of such transactions as a multiple of LTM revenue, EBITDA and EBIT prior to the announcement of these transactions. William Blair compared the resulting range of transaction multiples of revenue, EBITDA and EBIT for the selected transactions to the implied transaction multiples for the sale of the BBI Core Businesses. Information regarding the multiples from William Blair's analysis of selected transactions is set forth in the following table:

 
    
   Selected Transaction Valuation Multiples
  
 
   Implied
Transaction
Multiples
  
 
   Minimum
   Median
   Mean
   Maximum
  
Enterprise Value/LTM Revenue   1.38 x 1.09 x 2.21 x 2.75 x 10.28 x
Enterprise Value/LTM EBITDA   12.7x   6.2x   12.2x   13.6x   24.6x  
Enterprise Value/LTM EBIT   22.9x   12.7x   16.2x   22.6x   46.1x  

        Discounted Cash Flow Analysis.    William Blair performed a discounted cash flow analysis based on the future earnings stream and corresponding cash flow of the projected five year financial performance of our BBI Core Businesses. We provided William Blair with projections for calendar years 2004 through 2008 for our BBI Core Businesses based on certain assumptions by our management regarding the performance of our BBI Core Businesses. In conducting this analysis, William Blair used discount rates ranging from 15.0% to 19.0% and calculated a terminal value at the end of fiscal year 2008 by assuming the free cash flow would grow in perpetuity beyond 2008 at annual growth rates ranging from 3.0% to 5.0%. The discount rates utilized in this analysis were chosen based upon an analysis of the weighted average cost of capital of our company. The growth rates utilized were chosen based upon

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William Blair's discussion with our company regarding the historical growth rates and long-term growth prospects of our BBI Core Businesses. Based on William Blair's analysis, the implied enterprise value of our BBI Core Businesses ranged from $16.1 million to $25.2 million. Discounted cash flow analysis is a widely used valuation methodology, but it relies on numerous assumptions, including asset values and earnings growth rates, terminal values and discount rates.

        Other Information.    The summary set forth above does not purport to be a complete description of the analyses of data underlying William Blair's opinion. The preparation of a fairness opinion is a complex process and is not necessarily susceptible to a partial analysis or summary description. William Blair believes that its analyses must be considered as a whole and that selecting portions of its analyses, without considering the analyses taken as a whole, would create an incomplete view of the process underlying the analyses set forth in its opinion. In addition, William Blair considered the results of all such analyses and did not assign relative weights to any of the analyses, so the ranges of valuations resulting from any particular analysis described above should not be taken to be William Blair's view of the actual value of our BBI Core Businesses.

        In summary, William Blair based its opinion on the totality of the analyses it conducted and not on any single analysis. William Blair may have given various valuation ranges more or less weight than other valuation ranges, and may have deemed various assumptions more or less probable than other assumptions, so that the range of valuations resulting from any particular analysis described above should not be taken to be William Blair's view of the actual value of the BBI Core Businesses.

        We hired William Blair based on its qualifications and expertise in providing financial advice to companies and on its reputation as a nationally recognized investment banking firm. Pursuant to a letter agreement, dated October 25, 2002, William Blair was paid a retainer fee of $50,000 for its role as financial advisor and is entitled to an additional $100,000 upon the delivery of its opinion, dated April 16, 2004, as to the fairness to the Company, from a financial point of view, of the transaction consideration to be paid by SeraCare pursuant and subject to the conditions set forth in the asset purchase agreement. In addition, under the terms of the October 25, 2002 letter agreement, William Blair will receive an additional fee of $450,000 contingent upon consummation of the transaction. In addition, we have agreed to reimburse William Blair for its out-of-pocket expenses (including fees and expenses of its counsel) reasonably incurred by it in connection with its services and will indemnify William Blair against certain liabilities that may arise out of its engagement.

        Mr. Richard P. Kiphart, an investor who beneficially owns or controls approximately 23% of the outstanding shares of our common stock as of December 31, 2003, is a Principal and Head of the Corporate Finance Department of William Blair. Mr. Kiphart did not assist William Blair in giving its fairness opinion in the proposed transaction. Mr. Kiphart has agreed to vote his shares in favor of the sale to SeraCare, as described further under the section "Asset Purchase Agreement; Other Agreements Relating to the Asset Sale; Voting Agreements."

        William Blair has consented to the descriptions of its opinion in, and the inclusion of its opinion as an annexed to, this proxy statement.

        There are no material United States or state regulatory approvals required for the completion of the sale to SeraCare other than the approval of the asset purchase agreement by our stockholders under the corporate law of the Commonwealth of Massachusetts. As described further below under "Asset Purchase Agreement; Other Agreements Relating to the Asset Sale; Government Contracts", we have agreed with SeraCare that following the closing we will request the appropriate governmental authorities to novate certain identified government contracts.

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        General.    The following discussion is not a complete statement of the law pertaining to appraisal rights under the Massachusetts Business Corporation Act ("MBCA"), and is qualified in its entirety by the full text of Part 13, Dissenters' Rights, Sections 13.01 through 13.31 of Chapter 156D of the MBCA, which is provided in its entirety as Appendix C to this proxy statement.

        Under Section 13.02(a)(3) of Chapter 156D of the MBCA, a stockholder of a Massachusetts corporation is entitled to appraisal rights and may obtain payment of the fair value of his or her shares upon completion of a sale of all or substantially all of the property of a corporation, provided that the stockholder properly perfects his or her appraisal rights. The enforcement by a stockholder of a request to receive payment for shares of common stock under the MBCA is an exclusive remedy and the stockholder may not challenge the action creating his or her entitlement to appraisal rights unless the action is unlawful or fraudulent with respect to the stockholder or the corporation.

        Under Section 13.20 of Chapter 156D of the MBCA, when a proposed sale of all or substantially all of the assets of a corporation is to be submitted to a vote at a meeting of stockholders, as in the case of the special meeting, the meeting notice must state that the corporation has concluded that stockholders are, are not or may be entitled to assert appraisal rights under Massachusetts law and include in that meeting notice a copy of Part 13 of the MBCA. This proxy statement constitutes notice to the holders of our common stock that they are entitled to appraisal rights under Massachusetts law. The applicable statutory provisions of the MBCA are attached to this proxy statement as Appendix C. For purposes of this summary, the term "stockholder" shall have the same meaning as defined in Part 13 of Chapter 156D, that is, the stockholder of record (i.e., the stockholder listed in our stock records maintained by our transfer agent) or the beneficial owner of the shares.

        Any stockholder who wishes to exercise appraisal rights or who wishes to preserve that right should review carefully the following discussion and Appendix C to this proxy statement. Moreover, because of the complexity of the procedures for exercising the right to seek appraisal of shares of common stock and the fact that Part 13 of Chapter 156D becomes effective on July 1, 2004, we believe that stockholders who consider exercising such appraisal rights should seek the advice of counsel, which counsel will not be paid for by us. Failure to strictly comply with the procedures specified in Part 13 of Chapter 156D of the MBCA will result in the loss of appraisal rights.

        Notice of Intent and Demand for Payment.    Any holder of our common stock wishing to exercise the right to demand appraisal under Part 13 of the MBCA must satisfy each of the following conditions:

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In general, a stockholder may assert appraisal rights only if the stockholder seeks them with respect to all of the holder's shares of common stock. If you are a stockholder of record for more than one beneficial stockholder, you may assert appraisal rights with respect to fewer than all the shares registered in your name as holder of record, provided that you notify us in writing of the name and address of each beneficial stockholder on whose behalf you are asserting appraisal rights. For a beneficial stockholder to assert appraisal rights, the beneficial stockholder must submit to us the record stockholder's written consent to the assertion of such rights not fewer than 40 nor more than 60 days after we send out written notice to the stockholder of appraisal rights, as described below. Stockholders who hold their shares in brokerage accounts or other nominee forms and who wish to exercise appraisal rights are urged to consult with their brokers to determine the appropriate procedures for the making of a demand for appraisal by the nominee.

        Appraisal Notice and Form.    If the sale to SeraCare is completed, within 10 days after the completion of the transaction, we will deliver a written appraisal notice and a form containing certain information to all stockholders who have satisfied the requirements to provide us notice of the stockholder's intent to demand appraisal rights and who have not otherwise voted in favor of the proposal to approve the sale to SeraCare, as further described above under "Notice of Intent and Demand for Payment." The appraisal notice we supply will include a copy of Part 13 of Chapter 156D of the MBCA and a form that specifies the date of the first announcement to stockholders of the principal terms of the proposed sale. The form we supply also requires the stockholder asserting appraisal rights to certify (i) whether or not beneficial ownership of the shares for which appraisal rights are asserted were acquired before the date of the first announcement of the proposed sale to SeraCare and (ii) that the stockholder did not vote for the sale to SeraCare. The form provided with the appraisal notice will state:

        Perfection of Rights.    As mentioned above, a stockholder who receives the appraisal notice described above and who wishes to exercise his or her appraisal rights shall certify on the form provided by us whether the beneficial owner of the shares acquired the shares before the date of the first announcement of the proposed sale to SeraCare, as described above under "Appraisal Notice and Form". If a stockholder fails to make this certification, we may elect to treat those shares as "after-acquired shares", for which payment is treated differently as described in detail under Section 13.25 of Chapter 156D. A stockholder who wishes to exercise appraisal rights shall execute and return the form provided by us and, in the case of certificated shares, deposit his or her stock certificates in accordance with the terms of the notice by the date referred to in the appraisal notice described above. Once a stockholder deposits his or her stock certificates or, in the case of uncertificated shares, returns the executed forms, that stockholder loses all rights as a stockholder (including rights to participate in any

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tender offer that we may engage in following the closing), unless the stockholder withdraws his or her election in accordance with the withdrawal procedures, which are summarized below.

        Withdrawal of Appraisal Rights.    A stockholder who has otherwise properly perfected his or her appraisal rights may decline to exercise his or her appraisal right and withdraw from the appraisal process by notifying us in writing by the date set forth in the appraisal notice described above. If the stockholder fails to withdraw from the appraisal process before the expiration of the withdrawal period, you may not thereafter withdraw without our written consent.

        Payment.    Within 30 days after the date on which the stockholder is required to deliver to us the form described above under "Appraisal Notice and Form", we will pay in cash to each stockholder who has properly perfected their appraisal rights, the amount we estimate to be the fair value of their shares, plus interest. The payment to each stockholder will be accompanied by:

        Notwithstanding the foregoing, in the event that the stockholder is demanding payment for "after-acquired shares", we may elect to withhold payment. If we elect to withhold payment, we must, within 30 days after the date on which the stockholder is required to deliver to us the form described above under "Appraisal Notice and Form", we notify all stockholders who have "after-acquired shares":

Within 10 days after receiving the stockholder's acceptance of our offer, we will pay in cash the amount we offered to each stockholder who agreed to accept our offer in full satisfaction of the stockholder's demand. Within 40 days after sending the notice to holders of "after-acquired shares", we must pay in cash the amount we offered to pay to each stockholder who does not satisfy the requirements for demanding appraisal under Section 13.26.

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        Procedure if Stockholder is Dissatisfied with Payment or Offer.    Within 30 days after receipt of payment for a stockholder's shares, a stockholder who is dissatisfied with the amount of the payment to be received shall notify us in writing of that stockholder's estimate of the fair value of the shares and demand payment of that estimate plus interest, less any payment we previously paid. In addition, within 30 days after receiving our offer to pay for a stockholder's "after-acquired shares", a stockholder holding "after-acquired shares" who was offered payment (as described above) and who is dissatisfied with that offer shall reject the offer and demand payment of the stockholder's stated estimate of the fair value of the shares plus interest. A stockholder's failure to notify us within such 30 day period, waives the right to demand payment from us and shall be entitled only to the payment made or offered by us as described above.

        Court Proceedings.    If a stockholder makes a proper and timely demand for payment which remains unsettled, we will commence an equitable proceeding within 60 days after receiving the payment demand and petition the court to determine the fair value of the shares and accrued interest. If we do not commence the proceeding within the 60-day period, we will pay in cash to each stockholder the amount the stockholder demanded, plus interest. We will commence the proceeding in the appropriate court of Plymouth County, Massachusetts, which is where our principal office in the Commonwealth of Massachusetts is located. We will make all stockholders, whether or not residents of the Commonwealth of Massachusetts, whose demands remained unsettled, parties to the proceeding as an action against their shares, and all parties shall be served with a copy of the petition. The court may appoint one or more persons as appraisers to receive evidence and recommend a decision on the question of fair value. The appraisers will have the powers described in the order appointing them, or in any amendment to it. The stockholders demanding appraisal rights are entitled to the same discovery rights as parties in other civil proceedings.

        Each stockholder made a party to the proceeding is entitled to judgment:

        Determination of Fair Value.    Section 13.01 of Chapter 156D defines "fair value" with respect to shares being appraised as the value of the shares immediately before the effective date of the corporate action to which the stockholder demanding appraisal objects, excluding any element of value arising from the expectation or accomplishment of the proposed corporate action unless exclusion would be inequitable. This would mean that the court would determine fair value immediately prior to the completion of the sale to SeraCare. This definition leaves untouched the accumulated case law about what constitutes fair value. While that case law in Massachusetts traditionally focused on market value, capitalized earnings value and asset value, recent cases have held that fair value in appraisal proceedings can and should be based upon the same techniques the investment community uses to determine value if the corporation as a whole, or its assets, were to be acquired by the highest bidder. See, e.g., Sarrouf v. New England Patriots Club, Inc., 397 Mass. 542 (1986).

        Court Costs and Counsel Fees.    The costs of the appraisal proceeding shall be determined by the court, including the reasonable compensation and expenses of appraisers of the court. The court shall assess the costs against us, except that the court may assess costs against all or some of the stockholders demanding appraisal, in amounts the court finds equitable, to the extent the court finds such stockholders acted arbitrarily, vexatiously, or not in good faith with respect to the rights provided by Part 13 of the MBCA. The court in an appraisal proceeding may also assess the fees and expenses of counsel and experts for the respective parties, in amounts the court finds equitable for specified reasons as described in Section 13.31 of Chapter 156D.

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        Any stockholder wishing to exercise appraisal rights is urged to consult legal counsel before attempting to exercise appraisal rights. Failure to strictly comply with all of the procedures set forth in Part 13 of Chapter 156D of the MBCA may result in the loss of a stockholder's statutory appraisal rights.

        The following is a summary of the principal material United States federal income tax consequences relating to the proposed sale of our BBI Core Businesses to SeraCare. The summary does not consider the effect of any applicable foreign, state, local or other tax laws nor does it address tax consequences applicable to stockholders that may be subject to special federal income tax rules. The following summary is based on the current provisions of the Internal Revenue Code, existing, temporary, and proposed Treasury regulations thereunder, and current administrative rulings and court decisions. Future legislative, judicial or administrative actions or decisions, which may be retroactive in effect, may affect the accuracy of any statements in this summary with respect to the transactions entered into or contemplated prior to the effective date of those changes.

        The proposed sale of our BBI Core Businesses to SeraCare will be a transaction taxable to us for United States federal income tax purposes. We will recognize taxable income equal to the amount realized on the sale in excess of our tax basis in the assets sold. The amount realized on the sale will consist of the cash we receive in exchange for the assets sold, plus the amount of related liabilities assumed by SeraCare.

        Although the sale of our BBI Core Businesses will result in a taxable gain to us, a portion of the taxable gain will be offset to the extent of current year losses from operations plus available net operating loss carry forwards, as currently reflected on our consolidated federal income tax returns. The taxable gain will differ from the gain to be reported in our financial statements due to temporary tax differences and certain other differences between the tax laws and generally accepted accounting principles.

        We believe we will be able to apply between approximately $4.1 and $4.6 million of federal tax loss carryforwards without limitation against the taxable gain from the sale of the BBI Core Businesses. However, due to the limitation of net operating loss carryforwards under the federal alternative minimum tax system, a portion of the taxable gain reduced by our net operating loss carryforwards may be subject to the federal alternative minimum income tax. As a result of the foregoing, we believe we will pay between approximately $4.0 and $4.4 million in federal and state taxes on the proceeds from the sale to SeraCare. The availability and amount of net operating loss carryforwards are subject to audit and adjustment by the Internal Revenue Service. In the event that the Internal Revenue Service adjusts the net operating loss carryforwards, we may incur an increased tax liability.

        We do not anticipate any direct tax consequence to you as a result of the sale to SeraCare. If we engage in an issuer tender offer following the closing, any tax consequences to you as a result of the tender offer will be described in the applicable tender offer documents that will be sent to stockholders describing the tender offer.

        Each holder of our common stock is urged to consult his or her own tax advisor as to the federal income tax consequences of the sale, and also as to any state, local, foreign or other tax consequences based on his or her own particular facts and circumstances.

        If the asset purchase agreement and the sale to SeraCare are approved by our stockholders as described in this proxy statement, we will record the sale in accordance with generally accepted accounting principles in the United States. Upon the completion of the sale to SeraCare, we will

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recognize a financial reporting gain, equal to the net proceeds (the sum of the purchase price less the expenses relating to the sale) less the net book value of the assets sold and the fair value of the indemnification liability retained.

        Because the sale to SeraCare will be deemed to be a sale of "substantially all of the assets," all of our outstanding options to purchase shares of our common stock will become immediately vested upon completion of the sale. Many of our currently outstanding options have exercise prices greater than the current fair market value of our common stock.

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RISK FACTORS

        You should carefully consider the special considerations described below as well as other information provided to you in this proxy statement in deciding how to vote on the proposal to sell our BBI Core Businesses. If any of the following special considerations actually occur, our business, financial condition or results of operations could be materially adversely affected, the value of our common stock could decline, and you may lose all or part of your investment.

        The sale to SeraCare may not be completed if the conditions to closing are not satisfied or waived.

        There is a risk that the sale of our BBI Core Businesses to SeraCare may not be completed because the conditions to closing, including our ability to obtain stockholder approval, SeraCare's receipt of sufficient financing to complete the transaction, and required consents from third parties, including landlords and parties to contracts, may not be satisfied or waived. If the transaction is not completed, it is possible we will have difficulty recouping the costs incurred in connection with negotiating the proposed transaction and our business may be seriously harmed.

        It is possible that we may not receive all of the cash provided for in the asset purchase agreement, and accordingly, we may have less cash to fund our remaining operations and to undertake our contemplated issuer tender offer following the closing.

        Pursuant to the asset purchase agreement, if our net asset value as of the closing date is less than $8.5 million, the amount of the purchase price we will receive will be reduced dollar for dollar. As of April 30, 2004, our estimated net asset value was approximately $9.0 million. In addition, $2.5 million of the purchase price will be deposited into an escrow account to be held in escrow for 18 months following the closing to secure our indemnification obligations under the asset purchase agreement. Some or all of the $2.5 million may be returned to SeraCare if we are required to indemnify SeraCare for any breaches of our representations, warranties or covenants in the asset purchase agreement. In the event that the purchase price is reduced because the closing net asset value is less than $8.5 million or in the event we do not receive all of the amounts deposited into escrow because of breaches of our representations, warranties and covenants in the asset purchase agreement, we will have less cash resources to fund our remaining pressure cycling technology business operations following the closing and to undertake our contemplated issuer tender offer following the closing. Further, we may have unforeseen liabilities and expenses that must be satisfied from the after tax net proceeds of the sale to SeraCare, leaving less to fund our remaining operations. If we do not have sufficient cash to fund our remaining operations, we may need to raise capital, which may not be possible under satisfactory terms, if at all, and our business may be seriously harmed.

        The asset purchase agreement will expose us to contingent liabilities up to an amount equal to the purchase price for the BBI Core Businesses, which could adversely affect our ability to pursue our remaining business operations or our ability to engage in an issuer tender offer following the closing.

        In the asset purchase agreement we have made customary representations and warranties to SeraCare, which are described below under the heading "Asset Purchase Agreement; Representations and Warranties." Pursuant to the asset purchase agreement, we agreed to indemnify SeraCare for any losses from breaches of most of our representations, warranties or covenants that occur within 21 months after the closing date of the sale to SeraCare. Our indemnification obligations for breaches of some representations and warranties, however, extend for a longer period of time. More specifically, our indemnification obligation for a breach of representations and warranties relating to compliance with environmental laws extend for five years after the closing date, representations and warranties

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relating to tax matters extend for the applicable statute of limitations period, and representations and warranties relating to our due organization, subsidiaries, authorization to enter into and perform the transactions contemplated by the asset purchase agreement and brokers fees extend indefinitely. Our indemnification obligations are limited by an overall cap equal to the purchase price. For example, an indemnification claim by SeraCare could result if SeraCare suffers any damages arising out of the inaccuracy of any of our representations about the assets comprising our BBI Core Businesses or if we fail to comply with a covenant or other agreement in the asset purchase agreement. The payment of any such indemnification obligations could adversely impact our cash resources following the completion of the sale to SeraCare and our ability to pursue other opportunities, including the development of our pressure cycling technology operations. In addition, if we become subject to a large indemnification claim prior to the completion of our anticipated issuer tender offer following the closing, we may not have sufficient cash to undertake the issuer tender offer to purchase shares of our common stock from stockholders following the closing or the price that we may be able to offer to stockholders may be substantially less than what we otherwise would have been able to offer.

        You are not guaranteed to receive any of the proceeds from the sale of our BBI Core Businesses.

        The purchase price for the assets of the BBI Core Businesses will be paid directly to our company. At this time, following the closing, we intend to use up to $21 million of the after-tax net proceeds from the sale to SeraCare to commence an issuer tender offer to purchase up to 6,000,000 shares of our common stock at $3.50 per share. If you decide not to tender your shares in the tender offer or if the tender offer is not commenced due to unanticipated events or circumstances beyond our control, including unforeseen liabilities or contingencies reducing the amount of proceeds available for the tender offer, you will not receive any proceeds from the sale of the assets and you will continue to be a stockholder in our company, however, trading in our common stock will likely be more difficult, due to, among other things, limited trading volume of our stock.

        We will be unable to compete with the BBI Core Businesses for five years from the date of closing.

        We have agreed that, without the prior written consent of SeraCare, we will not engage in or own or control any interest in (except as a passive investor of less than 5% of the outstanding equity interests of a company) any entity that competes with the BBI Core Businesses for a period of five years from the closing. Our pressure cycling technology operations, which we will continue to pursue following the closing, are not deemed to compete with the BBI Core Businesses.

        We may be required to pay a termination fee to SeraCare if the transaction is not completed and we engage in another transaction within the next twelve months.

        The asset purchase agreement requires us to pay SeraCare a termination fee if the asset purchase agreement is terminated prior to completion under certain cases. Specifically, if SeraCare terminates the asset purchase agreement as a result of a triggering event (as described herein under "Asset Purchase Agreement; Termination of the Asset Purchase Agreement) or if we terminate the asset purchase agreement at a time when terminable by SeraCare as a result of a triggering event, then we must pay SeraCare within 2 business days after demand by SeraCare a termination fee equal to $600,000; provided that if (i) prior to the termination a third party delivered to us an acquisition proposal, (ii) within one year following the termination an acquisition transaction is completed or we enter into an agreement or letter of intent providing for an acquisition transaction, and (iii) the aggregate purchase price paid for such acquisition transaction is equal to or greater than $35 million, then the termination fee shall be increased to an amount equal to 3% of the aggregate purchase price paid in the acquisition transaction.

        We would also be required to pay a termination fee in the event the asset purchase agreement is terminated by SeraCare or us prior to completion if, subject to the conditions in the asset purchase agreement, (i) the transaction has not closed by September 15, 2004, (ii) our stockholders do not

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approve the transaction, or (iii) we breach any covenant or agreement, or if any of our representations or warranties shall have been untrue when made or shall have become untrue, such that the condition to closing relating to the accuracy of representations and warranties or the compliance with covenants would not be satisfied, and prior to the termination a third party delivered to us an acquisition proposal and within one year following the termination an acquisition transaction is completed or we enter into an agreement or letter of intent providing for an acquisition transaction. The termination fee would be equal to $600,000, provided that the fee would be increased to an amount equal to 3% of the aggregate purchase price in the acquisition transaction if such aggregate purchase price is greater than or equal to $35 million.

        If we are required to pay SeraCare a termination fee, our business could be seriously harmed.

        If the sale to SeraCare is not completed, we may explore other potential transactions but there may not be any other offers from potential acquirors.

        If the sale to SeraCare is not completed, we may continue as an independent stand-alone operating company conducting our historical business, we may explore other strategic alternatives, including a sale of our assets to, or a business combination with, another party, or we may pursue other business opportunities and investments unrelated to our current business. There can be no assurance that any potential transaction will provide consideration equal to or greater than the price proposed to be paid by SeraCare in the transaction, or that we will be able to complete any alternative transaction. Although we had discussions with various parties concerning such a purchase, none of these parties may now have an interest in such a sale or be willing to offer a reasonable purchase price.

        If the sale to SeraCare is not completed, we may need additional funds to continue or grow our existing business and we may not have sufficient funds to develop our pressure cycling technology operations.

        If the sale to SeraCare is not approved, we will continue to operate our BBI Core Businesses unless and until we are able to negotiate another transaction that our board of directors believes is acceptable to the stockholders and to the company. We believe that we will need additional funding to properly continue the development of our pressure cycling technology activities while still making the necessary investments in the BBI Core Businesses, and it may be necessary to obtain additional funding to make needed investments in the BBI Core Businesses. To the extent that we do not obtain needed capital for our pressure cycling technology business through the sale of the BBI Core Businesses, we may have to obtain it through the issuance of additional debt or equity, by entering into a strategic relationship pursuant to which we may be required to share our rights to the pressure cycling technology product platform, or through other means, any one of which may reduce the value to us, perhaps substantially, of any further commercialization and development of pressure cycling technology products. There is no guarantee that we would be able to obtain such funding or enter into such relationships on terms acceptable to us or at all. Further, there is no guarantee that we would be able to obtain any funding for our BBI Core Businesses upon acceptable terms. Failure to obtain such funding or enter into such relationships could seriously harm our business.

        The failure to complete the sale of our BBI Core Businesses may result in a decrease in the market value of our common stock and may create substantial doubt as to our ability to grow our existing business and implement our current business strategies.

        The sale of our BBI Core Businesses is subject to a number of contingencies, including approval by our stockholders and other customary closing conditions. We cannot predict whether we will succeed in obtaining the approval of our stockholders. As a result, we cannot assure you that the sale of our BBI Core Businesses will be completed. If our stockholders fail to approve the proposal to sell our BBI Core Businesses to SeraCare at the special meeting or if the sale of our BBI Core Businesses is not completed for any other reason, the market price of our common stock may decline. In addition, failure to complete the sale of our BBI Core Businesses may substantially limit our ability to grow our

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existing business and implement our current business strategies, including the development of our pressure cycling technology activities. We currently believe it would be extremely difficult to continue to operate our BBI Core Businesses while continuing to operate our pressure cycling technology operations.

        Our business will be harmed if the proposed sale to SeraCare disrupts the operations of our business and prevents us from realizing intended benefits.

        Prior to the closing of the sale to SeraCare, our business operations may be disrupted due to a number of factors, any of which could harm our business or ability to complete the proposed transaction. These factors include:

        Michael Avallone, our chief financial officer, tendered his resignation effective July 23, 2004, to pursue a position with another company. We are currently searching for a replacement chief financial officer. Until we find a replacement, Kevin W. Quinlan, our president, chief operating officer and treasurer and former chief financial officer, will serve as our principal financial and accounting officer.

        By completing the sale to SeraCare, we will become less diversified.

        By selling our BBI Diagnostics and BBI Biotech assets, we will be selling our business units that generate our most significant sources of revenue. We will subsequently become primarily a development-stage company focused on the further development and commercialization of our pressure cycling technology product platform. We may invest in other technology in the future, but we have no current specific plans to do so at this time. This increases our business risk because we will be less diversified than before the sale of the BBI Core Businesses to SeraCare and because our remaining business is speculative.

        Our business following the asset sale will be dependent on the success of our pressure cycling technology products and services, which have a limited operating history and have generated substantial losses and only a limited amount of revenues to date.

        The BBI Core Businesses proposed to be sold to SeraCare pursuant to the asset purchase agreement represents more than 90% of our annual revenue in each of the past two years. Our business following the sale to SeraCare will leave us dependent on the performance of our pressure cycling technology activities, which will be our main operating unit going forward. Our pressure cycling technology business has a limited operating history and has incurred significant losses to date. Our first products utilizing our pressure cycling technology, the Barocycler™ NEP2017 instrument and related disposable PULSE™ Tubes, were introduced for commercial sale in September 2002. As of December 31, 2003, we invested approximately $11.0 million towards the development of our pressure cycling technology since 1997. Limited revenue has been generated from sales of our pressure cycling technology products and related services. More specifically, we generated revenues of $674,000 in fiscal 2003. Our failure to generate revenues from sales of these and other commercially viable pressure cycling technology products and services or otherwise reduce our losses relating to this business unit will adversely affect our business and may affect our ability to stay in business.

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        Our pressure cycling technology products and services are new and have limited market awareness.

        Our pressure cycling technology products have limited market awareness and, to date, limited sales. Our future success will be dependent in significant part on our ability to generate demand for our pressure cycling technology products and services and to develop additional commercial applications that incorporate our pressure cycling technology. To this end, our direct and indirect sales operations must increase market awareness of our pressure cycling technology products to generate increased revenue. Our products and services require a sophisticated sales effort targeted at both the scientists who would use this technology and the senior management of our prospective customers. All new hires will require training and will take time to achieve full productivity. We cannot be certain that we will be successful in our efforts to market and sell our products, and if we are not successful in building greater market awareness and generating increased sales, our future results of operations will be adversely affected.

        The sales cycle of our pressure cycling technology products has been lengthy and as a result, we have incurred and may continue to incur significant expenses before we generate any significant revenue related to those products.

        Our customers have required several months to test and evaluate our pressure cycling technology related products. This increases the possibility that a customer may decide to cancel or change plans, which could reduce or eliminate our sales to that customer. As a result of this lengthy sales cycle, we have incurred and may continue to incur significant research and development expenses, and selling, general and administrative expenses, before we generate the related revenue for these products, and we may never generate the anticipated revenue if a customer cancels or changes its plans. Factors associated with this lengthy sales cycle include the initial selling price of the PCT Barocycler™ NEP2017 and the limited amount of research data presently available demonstrating its capabilities and potential. Additional refinements in pressure cycling technology instrumentation have been made, including the development of a less expensive and smaller, bench top version of the Barocycler which we expect to be available for commercial sale in the third or fourth quarter of 2004; however, there can be no assurance that this bench top model will be successful or that we will generate any significant revenue from sales of these products.

        We may be unable to adequately respond to rapid changes in technology.

        The market for our pressure cycling technology products and related services is characterized by rapidly changing technology, evolving industry standards and frequent product introductions. The introduction of products and services embodying new technology and the emergence of new industry standards may render our existing pressure cycling technology products and related services obsolete and unmarketable if we are unable to adapt to change. A significant factor in our ability to grow and to remain competitive is our ability to successfully introduce new products and services that embody new technology, anticipate and incorporate evolving industry standards and achieve levels of functionality and prices acceptable to the market. If our pressure cycling technology products and related services are unable to meet our customers' needs or we are unable to keep pace with technological changes in the industry, our pressure cycling technology products could eventually become obsolete. We may be unable to allocate the funds necessary to improve our current products or introduce new products to address our customers' needs and respond to technological change. In the event that other companies develop more technologically advanced products, our competitive position relative to such companies would be harmed.

        Following the closing of the sale to SeraCare, your ability to sell your stock may be substantially limited.

        Our common stock is currently traded on the Nasdaq National Market under the symbol "BBII." Following the completion of the proposed transaction, we expect to continue to trade as a public company on the Nasdaq National Market. However, it is not possible to predict the trading price of

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our common stock following the closing of the sale to SeraCare. If we fail to meet any of the continued listing standards of the Nasdaq National Market, which requirements include a $1.00 minimum bid price, stockholders equity of $10 million, market value of publicly held shares equal to not less than $5.0 million, a minimum of 750,000 shares of common stock publicly held, 400 shareholders of record, two market makers and compliance with Nasdaq's corporate governance requirements, our common stock will be delisted from the Nasdaq National Market. If we are delisted from the Nasdaq National Market, we expect our common stock will be traded on the Nasdaq SmallCap Market if we meet the listing standards of that market or we will attempt to be traded on the OTC Bulletin Board or "pink sheets" maintained by the National Quotation Bureau, Inc. The OTC Bulletin Board and Pink Sheets are generally considered less efficient markets than the Nasdaq National Market and the Nasdaq SmallCap Market. It is likely that there will only be limited trading volume in our common stock following the closing of the sale to SeraCare. Accordingly, you may find it more difficult to dispose of your shares of common stock and you may not be able to sell some or all of your shares of common stock when and at such times as you desire.

        In addition, it is possible that following the tender offer contemplated after completion of the sale to SeraCare we may decide to take steps to terminate our reporting obligations if permissible under applicable SEC rules. If we were to terminate our reporting obligations, there will not be current or adequate public information readily available about our remaining operations and there will not be any active trading market for our common stock.

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ASSET PURCHASE AGREEMENT

        We believe this summary describes the material terms of the asset purchase agreement. However, we recommend that you read carefully the complete agreement for the precise terms of the asset purchase agreement and other information that may be important to you. The asset purchase agreement is included in this proxy statement as Appendix A.

        Subject to and upon the terms and conditions of the asset purchase agreement, we are selling to SeraCare all of our right, title and interest in and to the assets used in connection with or relating to our BBI Core Businesses, including the following assets:

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        We are retaining certain assets, including the following assets:

        Subject to and upon the terms and conditions of the asset purchase agreement, SeraCare will assume certain liabilities related to the BBI Core Businesses, including:

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        Other than the assumed liabilities, SeraCare will not assume any other liabilities, whether liquidated or unliquidated, known or unknown, or whether arising out of occurrences prior to, at or after the date of the agreement.

        The closing of the sale of our BBI Core Businesses will take place on the third business day after the last of the closing conditions is met, or such other date as we agree with SeraCare.

        SeraCare will pay us $30 million in cash for the assets of our BBI Core Businesses, subject to a post-closing adjustment described below. At the closing, $2.5 million of the purchase price will be deposited into escrow to be held in escrow by an independent escrow agent for a period of 18 months following the closing in order to secure our indemnification obligations to SeraCare under the asset purchase agreement. At the end of the 18 month period, any remaining amounts in the escrow account will be payable to us, subject to pending claims.

        A purchase price adjustment will occur if the closing net asset value of the assets to be transferred to SeraCare is greater or less than $8.5 million, measured as of the closing date. The adjustment amount is calculated by subtracting $8.5 million from the closing net asset value (the net amount of purchased assets less assumed liabilities as set forth on the closing balance sheet). An estimated adjustment amount will be calculated not less than three business days prior to the closing. In the event that the estimate shows that the net asset value is less than $8.5 million, the amount of this deficiency will be deducted from the purchase price to be paid to us at the closing. On or before 60 days after closing, SeraCare will prepare a balance sheet as of the closing date, which will include a calculation of the adjustment amount. We will be entitled to observe the preparation of the closing balance sheet. If the actual net asset value as set forth in the closing balance sheet is less than $8.5 million, then we must pay SeraCare the difference. Any estimated adjustment amount deducted from the purchase price at the closing will be applied to the final closing adjustment. If the net asset value as set forth in the closing balance sheet is greater than $8.5 million, then SeraCare must pay us the difference. If there are disagreements with the adjustment amount, the asset purchase agreement has a dispute resolution mechanism under which a nationally recognized independent public accounting firm will resolve the dispute. As of April 30, 2004, our estimated net asset value was approximately $9.0 million.

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        On the closing date or as promptly as possible after the closing date (or such time as otherwise specified in the asset purchase agreement), the following items will be prorated between us and SeraCare as of the closing date:

        We will pay any documentary transfer taxes and any sales, use or other taxes imposed by reason of the transfers of the purchased assets. SeraCare will pay the fees and costs of recording or filing all applicable conveyancing instruments and shall pay the costs for title searches or insurance premiums for title insurance to be obtained by SeraCare.

        In the asset purchase agreement, both we and BBI Biotech Research Laboratories make certain representations and warranties to SeraCare and, subject to certain limitations, we have agreed to indemnify SeraCare for any breach of the representations and warranties. These representations and warranties relate to the following:

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        For a complete text of the representations and warranties made by us or BBI Biotech Research Laboratories, refer to Article IV of the asset purchase agreement.

        In the asset purchase agreement, SeraCare makes certain representations and warranties to us and, subject to certain limitations, SeraCare has agreed to indemnify us for any breach of the representations and warranties. These representations and warranties relate to the following:

        For a complete text of the representations and warranties made by SeraCare, refer to Article V of the asset purchase agreement.

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        Under the asset purchase agreement, each of the parties have agreed to perform certain pre- and post-closing covenants. These covenants include, among other things, the following:

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        Many of the covenants contained in the asset purchase agreement are difficult to summarize. For a complete text of the foregoing covenants and additional covenants, please refer to Article VI of the Asset Purchase Agreement.

        Non-Solicitation.    Until the sale to SeraCare is completed or the asset purchase agreement is terminated, we have agreed that we will not, nor will we authorize or permit any of our officers, directors, principals, attorneys, agents, employees or other representatives, to directly or indirectly, do any of the following:

        Prior to the approval of the asset purchase agreement by our stockholders, however, we are not prohibited from complying with our obligations to make a recommendation with respect to a third party tender offer, and we are not prohibited from furnishing information about us to, entering into a

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confidentiality agreement with or entering into discussions with, any person in response to a superior offer (as defined below) submitted by that person, if:


        Notification of Acquisition Proposal to SeraCare.    We have agreed to advise SeraCare orally and in writing within 24 hours after receipt of an acquisition proposal, of any request we receive for nonpublic information which we reasonably believe would lead to an acquisition proposal or of any acquisition proposal, or any inquiry received by us or any of our representatives with respect to, or which we reasonably believe would lead to any acquisition proposal, the material terms and conditions of such request, acquisition proposal or inquiry, and the identity of the person or group making any such request, acquisition proposal or inquiry. We also agreed to keep SeraCare informed (orally and in writing) on a current basis and in all material respects of the status and details (including material amendments or proposed amendments) of any such request, acquisition proposal or inquiry.

        Definition of Acquisition Proposals and Acquisition Transaction.    Under the asset purchase agreement, an "acquisition proposal" means any offer or proposal relating to any "acquisition transaction" which include any of the following transactions:

        Definition of Superior Offer.    Under the asset purchase agreement, a "superior offer" means an unsolicited, bona fide written offer made by a third party to engage in any of the following transactions:

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in each case on terms that our board of directors determines, in its reasonable judgment (based on advice of its outside financial advisor and after considering all terms and conditions of the written offer, including the likelihood and timing of completion) to be more favorable to us or our stockholders from a financial point of view than the terms of the asset purchase agreement with SeraCare. An offer will not be deemed to be a superior offer, however, if any financing to be obtained in connection with the transaction is less committed than SeraCare's financing or is not likely in the good faith judgment of our board of directors to be obtained by the third party on a timely basis.

        Withdrawal of Recommendation of Board of Directors.    We have agreed that we would include in this proxy statement our board of directors' recommendation that our stockholders vote in favor of the sale of our BBI Core Businesses pursuant to the asset purchase agreement and agreed not to withdraw, amend or modify, or propose to withdraw, amend or modify in a manner adverse to SeraCare, this recommendation. Notwithstanding the foregoing, our board of directors is permitted to withhold, withdraw, amend or modify any such recommendation previously made if our board of directors reasonably concludes in good faith, after consultation with its outside counsel, that to not withhold, withdraw, amend or modify such recommendation would constitute a breach of the fiduciary duties of the board of directors under applicable law or there is a superior offer, as defined above. We are not required to hold and convene this special meeting if there is a superior offer or canceling the special meeting is necessary for our board to comply with its fiduciary duties.

        The closing of the sale to SeraCare will be held promptly after approval by our stockholders and the satisfaction of all other conditions to closing. These conditions are further described below.

        Our obligation to complete the transaction is subject to various conditions, which must be satisfied or waived prior to the closing date, including the following material conditions:

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        SeraCare's obligation to complete the transaction is subject to various conditions, which must be satisfied prior to the closing date, including the following material conditions:

        At the closing of the sale to SeraCare, we will enter into an escrow agreement with SeraCare and Wells Fargo Bank, N.A. regarding the establishment and maintenance of an escrow account to secure our indemnification obligations under the asset purchase agreement. Under the terms of the escrow agreement, SeraCare will deposit $2.5 million of the total purchase price in an escrow account at the closing. Any claims by SeraCare for indemnifiable damages must be submitted to us and to the escrow agent pursuant to customary procedures specified in the escrow agreement. The escrow agreement will terminate 18 months after the closing. Any portion of the escrow fund not subject to any pending claim will be released to us on the expiration date of the escrow agreement. Any remaining amounts not used to satisfy pending claims will be released following resolution of such pending claims.

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        A number of our contracts that are being purchased by SeraCare are government contracts that will be required to be novated by the proper government authority. We have agreed that following the closing we will request formal novations from the proper governmental authorities and that we will use our reasonable efforts to effect the prompt novation of these identified government contracts into the name of SeraCare. In addition, for those of our government contracts that are not required to be novated, we have agreed to make interim legal arrangements whereby SeraCare, on our behalf, will perform all of our duties and obligations under these government contracts in return for which SeraCare will be entitled to receive all payments to which we would otherwise be entitled under such contracts.

        In connection with the asset purchase agreement, we have agreed to enter into a transition services agreement with SeraCare pursuant to which SeraCare will provide us with access to specified office and laboratory space in Gaithersburg, Maryland, and will allow us to use certain laboratory equipment for our remaining operations, for a period of up to one year following the closing. We will conduct our marketing and sales, finance, and non-engineering research and development activities for our pressure cycling technology operations at this location. We have agreed to pay SeraCare approximately $3,000 per month for the use of office and laboratory space in Gaithersburg, Maryland. We have also agreed with SeraCare that certain of our current employees, who will become employees of SeraCare following the closing, will be permitted to provide some services for us after the closing. For this right, we have agreed to pay SeraCare a 30% premium on salary for any of SeraCare's employees that perform work for us.

        We have agreed that, subject to limited exceptions, neither we nor any of our subsidiaries involved in the BBI Core Businesses will carry on or participate in the ownership, management or control of, or the financing of, or be employed by, or consult for or otherwise render services to, or allow its name or reputation to be used in or by any other present or future business enterprise that competes with SeraCare in the business conducted by the BBI Core Businesses for a five year period following the closing; these non-competition provisions do not prohibit us from:

        We have also agreed that for one and one half years following the closing, we will not induce any of our former employees that are rehired by SeraCare to leave the employment of SeraCare, to accept any other employment or position or assist any other entity in hiring any such employee.

        Mr. Richard T. Schumacher, our founder, Chief Executive Officer and a director, has also agreed that he will enter into an agreement which will provide that he will not compete with the BBI Core Businesses for a two year period following the closing. In addition, for a period of one and one half years following the Closing, Mr. Schumacher has agreed not to induce any employee of SeraCare, including any of our former employees that are rehired by SeraCare, to leave the employment of SeraCare, to accept any other employment or position or assist any other entity in hiring any such

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employee. He has also agreed not to do business with customers or suppliers of SeraCare who have been customers or suppliers of ours within the last five years, provided, however, that such prohibitions do not prevent Mr. Schumacher from selling pressure cycling technology products to these persons or entering into a relationship with these persons if unrelated to the purchased business.

        In order to provide an incentive for SeraCare to enter into the asset purchase agreement, each of Mr. Richard T. Schumacher, our founder, Chief Executive Officer and a member of our board of directors, and Mr. Richard Kiphart (together with Mr. Kiphart's daughter and a fund in which he serves as the general partner), who as of April 16, 2004, held an aggregate of 2,824,189 shares of our common stock, or approximately 32.0% of the issued and outstanding shares of our common stock entitled to vote at the special meeting, have executed voting agreements and irrevocable proxies with SeraCare dated as of April 16, 2004.

        In the voting agreements, these stockholders have agreed to:

        Notwithstanding the foregoing, these stockholders are not required to vote their shares in favor of the matters identified in the first bullet point above or against the matters identified in the second bullet point above if a superior offer is made after the date of the asset purchase agreement and in response to such superior offer, our board of directors withholds, withdraws, modifies, amends or modifies its recommendation in favor of the superior offer in a manner materially adverse to SeraCare because our board of directors has reasonably concluded in good faith, after consultation with outside counsel, that the failure to withhold, withdraw or amend or modify such recommendation would violate their fiduciary obligations under applicable law.

        Furthermore, each of these stockholders agreed not to:

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        These stockholders also agreed to be prohibited from engaging in solicitations of any acquisition proposal similar in scope and restriction as the prohibitions on solicitations agreed to by us in the asset purchase agreement. For a detailed description of these restrictions, see the section above entitled "Solicitation; Withdrawal of Recommendation by Our Board of Directors".

        The voting agreements terminate upon the earlier of the completion or termination of the transactions contemplated by the asset purchase agreement. The form of each of Mr. Schumacher's and Mr. Kiphart's voting agreement is attached to this proxy statement as Appendix D and Appendix E.

        Under the asset purchase agreement, we are obligated to indemnify and hold harmless SeraCare from and against all losses that it incurs arising out of or resulting from:

        The asset purchase agreement provides that SeraCare will indemnify and hold harmless us and BBI Biotech from and against all losses that we incur arising out of or resulting from:

        The indemnification provisions contained in the asset purchase agreement are complicated and not easily summarized. You are urged to carefully read Article X of the asset purchase agreement attached as Appendix A to this proxy statement.

        In general, with respect to losses suffered by SeraCare resulting from a breach of any of our representations and warranties, neither we nor BBI Biotech will be obligated to indemnify SeraCare for any losses due to such breach or breaches until the aggregate amount of the losses exceeds $300,000, and then only to the extent the amount of such losses, in the aggregate, exceed $150,000. Our obligation to indemnify SeraCare for losses due to all other matters other than with respect to breaches of our representations and warranties are not subject to any minimum threshold amounts. The maximum aggregate amounts that SeraCare may recover for losses from us or BBI Biotech for indemnification is equal to the purchase price.

        The representations and warranties made by each party to the asset purchase agreement survive the closing for a period of 21 months following the closing, except with respect to the representations and warranties concerning our due organization, subsidiaries engaged in the business, our due

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authorization of the transaction, and the absence of brokers, which survive indefinitely, and the representations and warranties relating to compliance with environmental laws and tax matters, which survive until the expiration of the applicable statute of limitations.

        At the time of closing of the sale to SeraCare, as previously described, $2.5 million of the purchase price will be deposited into escrow to be held in escrow by an independent escrow agent for a period of 18 months following the closing in order to secure our indemnification obligations to SeraCare under the asset purchase agreement. At the end of the 18 month period, any remaining amounts in the escrow account will be payable to us, subject to pending claims. If we are required to pay any damages as a result of our indemnification obligations, payments will first be deducted from the escrow fund. To the extent that the funds from the escrow agreement are insufficient to pay the damages, we will be required to pay the damages from the working capital of our remaining operations following the closing.

        The asset purchase agreement and the transactions contemplated thereby may be terminated at any time prior to closing, in any of the following ways:

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        If the asset purchase agreement is terminated because of any the reasons described above, the asset purchase agreement will be of no further force or effect, except for certain specified obligations, including the return of information to the party furnishing the information and the preservation of confidentiality and, in limited circumstances, described in detail in the section below entitled "—Payment of Termination Fee", either party may be obligated to pay the other a termination fee at or following the termination of the asset purchase agreement. Neither party will be relieved from liability for any intentional or willful breach of the asset purchase agreement.

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        The asset purchase agreement requires us to pay SeraCare a termination fee if the asset purchase agreement is terminated prior to completion under certain cases. Specifically, if SeraCare terminates the asset purchase agreement as a result of a triggering event (as described above under "Termination of the Asset Purchase Agreement) or if we terminate the asset purchase agreement at a time when terminable by SeraCare as a result of a triggering event, then we must pay SeraCare within 2 business days after demand by SeraCare a termination fee equal to $600,000; provided that if (i) prior to the termination a third party delivered to us an acquisition proposal, (ii) within one year following the termination an acquisition transaction is completed or we enter into an agreement or letter of intent providing for an acquisition transaction, and (iii) the aggregate purchase price paid for such acquisition transaction is equal to or greater than $35 million, then the termination fee shall be increased to an amount equal to 3% of the aggregate purchase price paid in the acquisition transaction.

        We would also be required to pay a termination fee in the event the asset purchase agreement is terminated by SeraCare or us prior to completion if, subject to the conditions in the asset purchase agreement, (i) the transaction has not closed by September 15, 2004, (ii) our stockholders do not approve the transaction, or (iii) we breach any covenant or agreement, or if any of our representations or warranties shall have been untrue when made or shall have become untrue, such that SeraCare's condition to closing relating to the accuracy of our representations and warranties or the compliance with our covenants would not be satisfied, and prior to the termination a third party delivered to us an acquisition proposal and within one year following the termination an acquisition transaction is completed or we enter into an agreement or letter of intent providing for an acquisition transaction. The termination fee would be equal to $600,000, provided that the fee would be increased to an amount equal to 3% of the aggregate purchase price in the acquisition transaction if such aggregate purchase price is greater than or equal to $35 million.

        The asset purchase agreement also requires SeraCare to pay us a termination fee in the amount of $600,000 in the event we terminate the asset purchase agreement as a result of SeraCare's failure to obtain financing for the transactions prior to September 15, 2004, and the agreement is not otherwise terminable by SeraCare pursuant to any other provision of the agreement.

        Except as otherwise provided in the asset purchase agreement, each party to the asset purchase agreement will pay its own legal, accounting, out-of-pocket and other expenses incident to the asset purchase agreement and to any action taken by such party in preparation for effectuating the asset purchase agreement.

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FINANCIAL HISTORY AND EFFECTS OF THE PROPOSED SALE TO SERACARE

        We are providing the following information to aid you in your financial analysis of the proposed asset sale. The selected consolidated financial data for each of the fiscal years in the five years ended December 31, 2003 have been derived from our audited consolidated financial statements, which have been filed on annual reports on Form 10-K and are incorporated by reference. The data presented below should be read in conjunction with our audited financial statements for each of the fiscal years in the five years ended December 31, 2003, which are incorporated by reference.


BOSTON BIOMEDICA, INC.

 
   Year Ended December 31,
  
Consolidated Statement of Operations Data:
  
  2003
   2002
   2001
   2000
   1999
  
 
   in thousands, except per share data

  
REVENUE:                                
  Products   $ 13,608   $ 12,697   $ 13,093   $ 12,387   $ 14,057  
  Services     9,688     10,068     8,733     7,083     5,741  
   
 
 
 
 
 
    Total revenue     23,296     22,765     21,826     19,470     19,798  
   
 
 
 
 
 
COSTS AND EXPENSES:                                
  Cost of products     7,263     6,536     6,338     7,270     7,267  
  Cost of services     7,602     7,727     6,783     5,581     4,568  
  Research and development     1,816     2,611     2,303     2,444     3,132  
  Selling and marketing     3,283     3,286     2,916     2,660     2,831  
  General and administrative     4,346     4,109     3,977     4,919     3,451  
  Impairment of intangible asset(1)     —     —     —     1,464     —  
   
 
 
 
 
 
    Total operating costs and expenses     24,310     24,269     22,317     24,338     21,249  
   
 
 
 
 
 
      Loss from continuing operations     (1,014 )   (1,504 )   (491 )   (4,868 )   (1,451 )
  Interest (expense) income, net(2)     (272 )   (206 )   (380 )   (1,594 )   (413 )
   
 
 
 
 
 
      Loss from continuing operations before income taxes     (1,286 )   (1,710 )   (871 )   (6,462 )   (1,864 )
  (Provision for) benefit from income taxes(3)     (3 )   (3 )   (16 )   (1,152 )   744  
   
 
 
 
 
 
      Loss from continuing operations before cumulative effect of change in accounting principle     (1,289 )   (1,713 )   (887 )   (7,614 )   (1,120 )
  Cumulative effect of change in accounting principle(2)     —     —     —     (190 )   —  
      Loss from continuing operations     (1,289 )   (1,713 )   (887 )   (7,804 )   (1,120 )
   
 
 
 
 
 
  Income (loss) from discontinued operations     —     225     4,334     (197 )   306  
   
 
 
 
 
 
    Net income (loss)   $ (1,289 ) $ (1,488 ) $ 3,447   $ (8,001 ) $ (814 )
   
 
 
 
 
 
Loss per share from continuing operations, basic and diluted   $ (0.19 ) $ (0.26 ) $ (0.14 ) $ (1.43 ) $ (0.24 )
Net (loss) income per share, basic and diluted     (0.19 )   (0.22 )   0.56     (1.46 )   (0.17 )
Number of shares used to calculate net (loss) income per share                                
    Basic and Diluted     6,811     6,661     6,204     5,465     4,670  
 
   December 31,
Consolidated Balance Sheet Data:
  2003
   2002
   2001
   2000
   1999
Working capital   $ 7,659   $ 9,197   $ 9,407   $ 3,596   $ 8,615
Net assets from discontinued operations     —     —     —     1,238     1,978
Total assets     16,842     19,843     21,414     22,549     24,934
Long term debt, less current maturities     2,271     2,338     2,403     5,287     7,146
Total stockholders' equity     10,415     12,627     13,440     7,750     13,646
Dividends     —     —     —     —     —
(1)
Consists of a $1,464 write-down of goodwill associated with the acquisition of BBI Source Scientific.

(2)
Includes $840 of interest expense in 2000 associated with the beneficial conversion feature of the Company's 3% Senior Subordinated Convertible Debentures; $190 of this amount is recorded as a cumulative effect of change in accounting principle in 2000.

(3)
Includes $1,135 in 2000 for establishment of a full valuation allowance on the Company's deferred tax assets.

68

Unaudited Pro Forma Financial Information

        The following unaudited pro forma condensed consolidated financial data gives effect to the sale of the BBI Core Businesses. The unaudited pro forma consolidated balance sheet as of March 31, 2004 has been prepared assuming the sale of the BBI Core Businesses occurred as of that date. The unaudited pro forma condensed consolidated statements of operations for the three months ended March 31, 2004 and 2003 and the years ended December 31, 2003, 2002 and 2001 have been prepared assuming that the sale of the BBI Core Businesses occurred as of the beginning of the period presented and are reported as discontinued operations. We have assumed that of the total consideration, $27.5 million in cash will be paid to us at closing and $2.5 million will be placed in escrow for a period of 18 months following the closing in order to secure our indemnification obligations under the asset purchase agreement. The $2.5 million is part of other long-term assets on our balance sheet at March 31, 2004. At the end of the 18 month escrow period, all funds remaining in the escrow account at that time will be paid to us by the escrow agent, subject to any pending claims. The unaudited pro forma condensed consolidated financial data is presented for informational purposes only and is not necessarily indicative of the results of future operations of our company or the actual results of operations that would have occurred had the sale of the BBI Core Businesses been consummated as of the dates indicated above. The unaudited pro forma condensed consolidated financial data should be read in conjunction with our historical consolidated financial data and notes contained in our reports filed with the Commission.

        The unaudited pro forma consolidated balance sheet as of March 31, 2004 has been prepared to reflect the accounting treatment of the legal divestiture of certain assets and liabilities of our BBI Source Scientific, Inc. business unit, assuming that the transaction occurred as of that date, and the unaudited pro forma condensed consolidated statement of operations for the three months ended March 31, 2004 and 2003 and the year ended December 31, 2003 have been prepared to reflect the accounting treatment of the legal divestiture of certain assets and liabilities of our BBI Source Scientific, Inc. business unit, assuming that the transaction occurred on January 1, 2003. On June 1, 2004, we transferred certain assets and liabilities of our BBI Source Scientific, Inc. subsidiary, to a newly formed limited liability company known as Source Scientific, LLC. At the time of the transfer, we owned 100% of the ownership interests of Source Scientific, LLC. On June 2, 2004, we completed the sale of 70% of the ownership interests of Source Scientific, LLC to Richard Henson and Bruce Sargeant, two unrelated third parties, and we retained a 30% ownership interest in Source Scientific, LLC. As consideration for the transaction, we received secured promissory notes from Mr. Henson and Mr. Sargeant in the aggregate principal amount of $900,000, which, together with accrued interest, are due on or before May 31, 2007. The aggregate principal amount of the notes may be reduced to $720,000 if the promissory notes are paid in full by May 31, 2005 or $810,000 if the notes are paid in full by May 31, 2006. The promissory notes are secured by pledges of the purchasers' 70% ownership interests in Source Scientific, LLC. The agreements executed and delivered in the transaction provide that we have the right to designate one representative to a Board of three Managers of Source Scientific, LLC, until the later of September 30, 2005 or the full payment of the promissory notes. In addition, in accordance with the agreements, we have the right, but not the obligation, to designate the three members of the Board of Managers in the event that Source Scientific, LLC fails to achieve at least eighty percent (80%) of the quarterly and annual operating income and cash flow projections set forth in the annual budget and projections for Source Scientific, LLC for any calendar quarter. In connection with the transaction, we guaranteed the remaining lease payments under the lease of the facility in California which we transferred to Source Scientific, LLC. Our guaranty obligations under this lease end on January 31, 2005 and our potential remaining exposure under this lease guaranty is approximately $160,000.

        Although we expect the promissory notes to be paid in full by Mr. Henson and Mr. Sargeant, the repayment of the promissory notes may be viewed as being dependent on the future successful operations of the business of Source Scientific, LLC. In addition, despite our intent to exit that

69


business, we may be viewed as having a continuing involvement in the business of Source Scientific, LLC due to the fact that we have the right to designate one or potentially three members of the Board of Managers and we are guaranteeing the facility lease payments until January 31, 2005. Because of these factors, even though the transaction is treated as a divestiture for legal purposes, we have not recognized the transaction as a divestiture for accounting purposes in accordance with Securities and Exchange Commission ("SEC") Staff Accounting Bulletin ("SAB") Topic 5E, Accounting for Divestiture of a Subsidiary or Other Business Operation. In accordance with SAB Topic 5E, we have recorded the assets and liabilities associated with the Source Scientific, LLC operation on our pro forma consolidated balance sheet as of March 31, 2004 under the captions "Assets transferred under contractual arrangements" and "Liabilities transferred under contractual arrangements" and have recorded a charge to income under the caption "Other operating credits and charges, net" in our pro forma condensed consolidated statement of operations for the three months ended March 31, 2004 and 2003 and the year ended December 31, 2003 equal to the amount of the loss attributable to the business of Source Scientific, LLC for the respective periods, assuming that the transaction occurred on January 1, 2003. In accordance with SAB Topic 5E, we will continue this accounting treatment until circumstances have changed or until the net assets of the Source Scientific, LLC business have been written down to zero (or a net liability is recognized in accordance with GAAP).

        For your information, on the pro forma balance sheet for March 31, 2004 we have also shown the effects the tender offer contemplated following the closing of the sale to SeraCare could have on our pro forma balance sheet if the tender offer is completed. We have assumed a few different scenarios, including the tender of 6,000,000 shares, 5,500,000 shares and 5,000,000 shares, in each case, at an assumed tender offer price of $3.50 per share. You should be aware that although we expect to commence the tender offer shortly following the closing, it is possible that we will not commence the tender offer or the cash payment we expect to offer could be substantially less than we currently anticipate due to unanticipated events or circumstances beyond our control or unforeseen liabilities or contingencies.

        The pro forma adjustments were based upon available information and upon certain assumptions as described in the notes to the unaudited pro forma condensed consolidated financial statements that our management believes are reasonable under the circumstances. The pro forma adjustments are based on the information available at the date of this filing.

        The unaudited pro forma condensed consolidated financial statements and accompanying notes should be read in conjunction with our historical consolidated financial statements and accompanying notes thereto, and our "Management's Discussion and Analysis of Financial Condition and Results of Operation", in our Annual Report on Form 10-K, as amended, for the year ended December 31, 2003 and our Quarterly Report on Form 10-Q for the quarter ended March 31, 2004, (copies of which are being sent to you with this proxy statement and are incorporated herein). In addition, the unaudited pro forma condensed consolidated financial statements should be read in conjunction with the historical financial statements of the assets being sold pursuant to the proposed transaction with SeraCare, which are set forth below.

70

BOSTON BIOMEDICA, INC.

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET

As of March 31, 2004

 
   Consolidated Boston Biomedica Inc. as Reported March 31, 2004
   Net Book Value of BBI Diagnostics Assets and Liablities Sold as of March 31, 2004
   Net Book Value of BBI Biotech Assets and Liablities Sold at March 31, 2004
   Pro Forma Adjustment
   Footnote Reference
   Proceeds Received from Sale of Diagnostics and Biotech to SeraCare; Record Transaction Costs Income Taxes & Escrow
   Footnote Reference
   Pro Forma Totals Excluding Biotech & Diagnostics
   Assumed Tender Offer—6,000,000 Shares Tendered at $3.50/Share
Note 6
   Payment of Transaction Costs Incl Taxes
Note 6
   Pro Forma Totals After Tender Offer: Corp., PCT, BBI Bioseq and Source Scientific, LLC
   Adjusted Pro Forma Totals After Tender Offer: Corp., PCT, BBI Bioseq and Source Scientific, LLC Note 8
  
ASSETS                                                                      
CURRENT ASSETS:                                                                      
  Cash and cash equivalents   $ 1,288,687   $ 23,550   $ (121,724 )           $ 27,500,000   1, 5   $ 28,690,513   $ (21,000,000 ) $ (6,500,000 ) $ 1,190,513   $ 1,143,387  
  Accounts receivable, net     3,497,405     (1,619,804 )   (1,603,329 )                       274,272                 274,272     17,668  
  Inventories     6,633,829     (5,289,254 )   (516,676 ) $ 8,785   7               836,691                 836,691     267,315  
  Restricted Cash—line of credit bank acount     69,990     —                               69,990                 69,990     69,990  
  Prepaid expenses and other current assets     286,566     (78,550 )   (86,291 )                       121,725                 121,725     103,329  
   
 
 
 
     
     
 
 
 
 
 
      Total current assets     11,776,477     (6,964,058 )   (2,328,020 )   8,785         27,500,000         29,993,191     (21,000,000 )   (6,500,000 )   2,493,191     1,601,689  
   
 
 
 
     
     
 
 
 
 
 
  Property and equipment, net     4,501,636     (2,543,475 )   (1,794,020 )   —         —         164,141                 164,141     91,180  
   
 
 
 
     
     
 
 
 
 
 
OTHER ASSETS:                                                                      
  Goodwill and other intangible assets, net     737,749     —                               737,749                 737,749     510,665  
  Restricted cash—amount held in escrow                                 2,500,000         2,500,000                 2,500,000     2,500,000  
  Assets transferred under contractual arrangements (Note 8)                                                                   1,221,225  
  Other long-term assets     452,356     (38,626 )   (167,008 )                       246,722                 246,722     217,044  
   
 
 
 
     
     
 
 
 
 
 
      Total other assets     1,190,105     (38,626 )   (167,008 )   —         2,500,000         3,484,471     —     —     3,484,471     4,448,934  
   
 
 
 
     
     
 
 
 
 
 
      TOTAL ASSETS   $ 17,468,218   $ (9,546,159 ) $ (4,289,048 ) $ 8,785       $ 30,000,000       $ 33,641,796   $ (21,000,000 ) $ (6,500,000 ) $ 6,141,803   $ 6,141,803  
   
 
 
 
     
     
 
 
 
 
 
LIABILITIES AND STOCKHOLDERS' EQUITY                                                                      
CURRENT LIABILITIES:                                                                      
  Accounts payable   $ 2,022,590   $ (1,227,543 ) $ (630,982 ) $ 246,418   2             $ 410,485               $ 410,485   $ 276,359  
    Taxes Payable & transaction costs payable                               $ 6,500,000         6,500,000         $ (6,500,000 )   —     —  
  Accrued employee compensation     1,168,502     (587,099 )   (336,927 )   (100,394 ) 3,4               144,082                 144,082     50,720  
  Other accrued expenses     500,309     (162,860 )   —                         337,449                 337,449     217,419  
  Net liabilities from discontinued operations     106,880     —     —                         106,880                 106,880     106,880  
  Line of Credit     518,952                                     518,952                 518,952     518,952  
  Current maturities of long term debt     58,180     (58,180 )   —                         —                 —     —  
  Deferred rent and other current liabilities     87,558     (240 )   (53,242 )                       34,076                 34,076     (1 )
   
 
 
 
     
     
 
 
 
 
 
      Total current liabilities     4,462,971     (2,035,922 )   (1,021,151 )   146,024         6,500,000         8,051,922     —     (6,500,000 )   1,551,924     1,170,329  
LONG-TERM LIABILITIES:                                                                      
  Long term debt, less current maturities     2,254,084     (2,254,084 )   —                         —                 —     —  
  Net liabilities from discontinued operations     95,000     —     —                         95,000                 95,000     95,000  
  Liabilities transferred under contractual arrangements (Note 8)                                                             —     381,595  
  Other liabilities     387,030     —     (287,353 )                       99,677                 99,677     99,677  
   
 
 
 
     
     
 
 
 
 
 
      Total liabilities     7,199,085     (4,290,006 )   (1,308,504 )   146,024         6,500,000         8,246,599     —     (6,500,000 )   1,746,601     1,746,601  
   
 
 
 
     
     
 
 
 
 
 
STOCKHOLDERS' EQUITY:                                                                      
  Common stock, $.01 par value; 20,000,000 shares authorized; 6,831,896 issued and outstanding at 3/31/04     68,319     —                               68,319     (60,000 )         8,319     8,319  
  Additional paid-in capital     21,897,849     —                               21,897,849     (20,940,000 )         957,849     957,849  
  Accumulated deficit     (10,697,035 )   —                     15,126,064         4,429,029                 4,429,029     4,429,029  
  Loan receivable from Director and former CEO     (1,000,000 )   —                               (1,000,000 )               (1,000,000 )   (1,000,000 )
   
 
 
 
     
     
 
 
 
 
 
      Total stockholders' equity     10,269,133     —     —               15,126,064         25,395,197     (21,000,000 )   —     4,395,197     4,395,197  
   
 
 
 
     
     
 
 
 
 
 
    TOTAL LIABILITIES & STOCKHOLDERS' EQUITY   $ 17,468,218   $ (4,290,006 ) $ (1,308,504 ) $ 146,024       $ 21,626,064       $ 33,641,796   $ (21,000,000 ) $ (6,500,000 ) $ 6,141,803   $ 6,141,803  
   
 
 
 
     
     
 
 
 
 
 

The pro forma adjustments to the unaudited pro forma condensed consolidated financial statements assume these transactions occurred on March 31, 2004 as follows:


71

BOSTON BIOMEDICA, INC.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED
STATEMENT OF OPERATIONS
For the Quarter Ended March 31, 2004

 
   Consolidated
Boston Biomedica, Inc. as Reported
March 31, 2004
   Adjusted
BBI Diagnostics
Excluding PCT
Activities and
Intercompany
Sales from BBIDX to Other BBI Entities
   Adjusted
BBI Biotech
Research
Laboratories, Inc.
Excluding PCT
Activities and
Intercompany Sales
From Biotech to
Other BBI Entities
   Pro Forma
Adjustments and
Reclassifications
   Footnote
   Pro Forma Subtotal Corp., PCT, BBI Bioseq and Source Scientific, LLC
   Footnote
   Adjusted Pro Forma Subtotal Corp., PCT, BBI Bioseq and Source Scientific, LLC Note 8
  
REVENUE:                                              
  Products   $ 3,263,548   $ 2,824,292   $ 50,119   $ (484 ) 1,5   $ 388,653       $ 4,531  
  Services     2,287,253     22,780     2,121,768     4,892         147,597         128,053  
   
 
 
 
     
     
 
    Total revenue     5,550,801     2,847,072     2,171,887     4,408         536,250         132,584  
   
 
 
 
     
     
 
COSTS AND EXPENSES:                                              
  Cost of products     1,748,139     1,340,993     66,072     (15,473 ) 1     325,601         2,265  
  Cost of services     1,626,748     —     1,616,565     19,881   1     30,064         70,846  
  Research and development     489,447     68,849     129,376     —         291,222         209,200  
  Selling and marketing     721,672     617,045     16,768     —         87,859         57,991  
  General and administrative     1,192,403     429,890     419,673     175,226   2,3,6     518,066   7     363,255  
   
 
 
 
     
     
 
    Total operating costs and expenses     5,778,409     2,456,777     2,248,454     179,634         1,252,812         703,557  
   
 
 
 
     
     
 
    Operating income (loss)     (227,608 )   390,295     (76,567 )   (175,226 )       (716,562 )       (570,973 )
Other operating credits and charges, net (Note 8)                                           (145,589 )
Net Interest Expense (income)     62,026     55,953     102     —         5,971         5,971  
   
 
 
 
     
     
 
    Income (Loss) before income taxes     (289,634 )   334,342     (76,669 )   (175,226 )       (722,533 )       (722,533 )
Benefit from (Provision for) income taxes     (1,100 )   (127,050 )   29,130     (41,440 ) 4     55,380         55,380  
   
 
 
 
     
     
 
    Net income (loss) from continuing operations*   $ (290,734 ) $ 207,292   $ (47,539 ) $ (216,666 )     $ (667,153) *     $ (667,153 )
   
 
 
 
     
     
 
* Excludes $135,000 gain from discontinued operations—clinical laboratory segment.            
Net loss per share, basic & diluted, from continuing operations   $ (0.04 )                       $ (0.10 )          
    Number of shares used to calculate net loss per share, basic and diluted     6,828,585                           6,828,585            

The Pro Forma adjustments to the unaudited pro forma condensed consolidated financial statements assume these transactions occurred on January 1, 2004, as follows:

72

BOSTON BIOMEDICA, INC.

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED

STATEMENT OF OPERATIONS

For the Quarter Ended March 31, 2003

 
   Consolidated
Boston Biomedica, Inc. as Reported
March 31, 2003
   Adjusted
BBI Diagnostics
Excluding PCT
Activities and
Intercompany
Sales from BBIDX to Other BBI Entities
   Adjusted
BBI Biotech
Research
Laboratories, Inc.
Excluding PCT
Activities and
Intercompany Sales
From Biotech to
Other BBI Entities
   Pro Forma
Adjustments and
Reclassifications
   Footnote
   Pro Forma Subtotal Corp., PCT, BBI Bioseq and Source Scientific, LLC
   Footnote
   Adjusted Pro Forma Subtotal Corp., PCT, BBI Bioseq and Source Scientific, LLC Note 8
  
REVENUE:                                              
  Products   $ 3,288,257   $ 2,839,043   $ 36,440   $ 33,450   1,5   $ 446,224       $ 70,275  
  Services     2,354,617     23,996     2,099,232     (33,451 ) 1     197,938         182,314  
   
 
 
 
     
     
 
    Total revenue     5,642,874     2,863,039     2,135,672     (1 )       644,162         252,589  
   
 
 
 
     
     
 
COSTS AND EXPENSES:                                              
  Cost of products     1,618,631     1,238,664     19,223     33,450   1     394,194         64,952  
  Cost of services     1,838,151     16,164     1,457,615     (387,365 ) 1     (22,993 )       2,989  
  Research and development     400,680     72,905     258,495     353,914         423,194         328,642  
  Selling and marketing     808,294     630,797     5,434     —         172,063         153,766  
  General and administrative     1,167,194     446,383     443,437     326,725   2,3,6     604,099   7     420,116  
   
 
 
 
     
     
 
    Total operating costs and expenses     5,832,950     2,404,913     2,184,204     326,724         1,570,557         970,465  
   
 
 
 
     
     
 
    Operating income (loss)     (190,076 )   458,126     (48,532 )   (326,725 )       (926,395 )       (717,876 )
Other operating credits and charges, net (Note 8)                                           (208,519 )

Net Interest Expense (income)
 
 
60,391
 
 
57,697
 
 
1,456
 
 
—
 
 
 
 
1,238
 
 
 
 
1,238
 
   
 
 
 
     
     
 
    Income (Loss) before income taxes     (250,467 )   400,429     (49,988 )   (326,725 )       (927,633 )       (927,633 )

Benefit from (Provision for) income taxes
 
 
(3,080
)
 
(152,163
)
 
18,995
 
 
(50,734
)
4
 
 
79,355
 
 
 
 
79,355
 
   
 
 
 
     
     
 
    Net income (loss) from continuing operations*   $ (253,547 ) $ 248,266   $ (30,993 ) $ (377,459 )     $ (848,278) *     $ (848,278 )
   
 
 
 
     
     
 
* Excludes $135,000 gain from discontinued operations—clinical laboratory segment.        
Net loss per share, basic & diluted, from continuing operations   $ (0.04 )                       $ (0.12 )          
Number of shares used to calculate net loss per share, basic and diluted     6,789,389                           6,789,389            

The Pro Forma adjustments to the unaudited pro forma condensed consolidated financial statements assume these transactions occurred on January 1, 2003, as follows:


73

BOSTON BIOMEDICA, INC.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED
STATEMENT OF OPERATIONS
For the Year Ended December 31, 2003

 
   Consolidated
Boston Biomedica, Inc. as Reported
December 31, 2003
   Adjusted
BBI Diagnostics
Excluding PCT
Activities and
Intercompany
Sales from BBIDX to Other BBI Entities
   Adjusted
BBI Biotech
Research
Laboratories, Inc.
Excluding PCT
Activities and
Intercompany Sales
From Biotech to
Other BBI Entities
   Pro Forma
Adjustments and
Reclassifications
   Footnote
   Pro Forma Subtotal Corp., PCT, BBI Bioseq and Source Scientific, LLC
   Footnote
   Adjusted Pro Forma Subtotal Corp., PCT, BBI Bioseq and Source Scientific, LLC Note 8
  
REVENUE:                                              
  Products   $ 13,607,808   $ 11,927,122   $ 158,100   $ 103,477   1,5   $ 1,626,063       $ 102,396  
  Services     9,687,882     130,773     8,867,120     (22,361 ) 1,5     667,628         568,605  
   
 
 
 
     
     
 
    Total revenue     23,295,690     12,057,895     9,025,220     81,116         2,293,691         671,001  
   
 
 
 
     
     
 
COSTS AND EXPENSES:                                              
  Cost of products     7,262,815     5,646,488     246,980     108,583   1,5     1,477,930         65,781  
  Cost of services     7,602,321     47,097     7,093,179     (285,096 ) 1,5     176,949         —  
  Research and development     1,816,273     287,402     245,067     150,830   1,5     1,434,634         1,267,864  
  Selling and marketing     3,282,538     2,731,271     19,141     (89,049 ) 5     443,077         411,504  
  General and administrative     4,345,643     1,534,362     1,583,149     884,429   2,3,6,7     2,112,561   7     1,484,208  
   
 
 
 
     
     
 
    Total operating costs and expenses     24,309,590     10,246,620     9,187,516     769,697         5,645,151         3,229,357  
   
 
 
 
     
     
 
    Operating income (loss)     (1,013,900 )   1,811,275     (162,296 )   (688,581 )       (3,351,460 )       (2,558,356 )
Other operating credits and charges, net (Note 8)                                           (793,104 )

Net Interest Expense (income)
 
 
271,892
 
 
232,539
 
 
4,808
 
 
—
 
 
 
 
34,545
 
 
 
 
34,545
 
   
 
 
 
     
     
 
    Income (Loss) before income taxes     (1,285,792 )   1,578,736     (167,104 )   (688,581 )       (3,386,005 )       (3,386,005 )

Benefit from (Provision for) income taxes
 
 
(3,430
)
 
(601,819
)
 
67,299
 
 
(249,258
)
4
 
 
281,831
 
 
 
 
281,831
 
   
 
 
 
     
     
 
    Net income (loss) from continuing operations*   $ (1,289,222 ) $ 976,917   $ (99,805 ) $ (937,839 )     $ (3,104,174 )*     $ (3,104,174 )
   
 
 
 
     
     
 
* Excludes $135,000 gain from discontinued operations—clinical laboratory segment.        
Net loss per share, basic & diluted, from continuing operations   $ (0.19 )                       $ (0.46 )     $ (0.46 )
    Number of shares used to calculate net loss per share, basic and diluted     6,810,660                           6,810,660         6,810,660  

The Pro Forma adjustments to the unaudited pro forma condensed consolidated financial statements assume these transactions occurred on January 1, 2003, as follows:

74

BOSTON BIOMEDICA, INC.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED
STATEMENT OF OPERATIONS
For the Year Ended December 31, 2002

 
   Consolidated
Boston Biomedica, Inc. as Reported
December 31, 2002
   Adjusted
BBI Diagnostics
Excluding PCT
Activities and
Intercompany
Sales from BBIDX to Other BBI Entities
   Adjusted
BBI Biotech
Research
Laboratories, Inc.
Excluding PCT
Activities and
Intercompany Sales
From Biotech to
Other BBI Entities
   Pro Forma
Adjustments and
Reclassifications
   Footnote
   Pro Forma Subtotal Corp., PCT, BBI Bioseq and Source Scientific
   Footnote
REVENUE:                                      
  Products   $ 12,696,830   $ 10,911,275   $ 158,500   $ 31,217   1   $ 1,658,272    
  Services     10,067,807     626,191     8,663,266     21,780   1     800,130    
   
 
 
 
     
   
    Total revenue     22,764,637     11,537,466     8,821,766     52,997         2,458,402    
   
 
 
 
     
   
COSTS AND EXPENSES:                                      
  Cost of products     6,535,429     5,175,077     112,502     31,217   1     1,279,067    
  Cost of services     7,727,137     264,014     6,589,133     (996,721 ) 1     (122,731 )  
  Research and development     2,611,060     566,003     928,837     1,018,501   1     2,134,721    
  Selling and marketing     3,286,183     2,561,131     98,429     —         626,623    
  General and administrative     4,108,734     1,492,749     1,412,147     440,320   2,3,6     1,644,158   7
   
 
 
 
     
   
    Total operating costs and expenses     24,268,543     10,058,974     9,141,048     493,317         5,561,838    
   
 
 
 
     
   
    Operating income (loss)     (1,503,906 )   1,478,492     (319,282 )   (440,320 )       (3,103,436 )  

Net Interest Expense (income)
 
 
206,162
 
 
237,087
 
 
8,851
 
 
—
 
 
 
 
(39,776
)
 
   
 
 
 
     
   
    Income (Loss) before income taxes     (1,710,068 )   1,241,405     (328,133 )   (440,320 )       (3,063,660 )  

Benefit from (Provision for) income taxes
 
 
(2,936
)
 
(467,074
)
 
124,691
 
 
(207,425
)
4
 
 
132,022
 
 
   
 
 
 
     
   
    Net income (loss) from continuing operations*   $ (1,713,004 ) $ 774,331   $ (203,442 ) $ (647,745 )     $ (2,931,638 )*  
   
 
 
 
     
   
* Excludes $135,000 gain from discontinued operations—clinical laboratory segment.    
Net loss per share, basic & diluted, from continuing operations   $ (0.26 )                       $ (0.44 )  
    Number of shares used to calculate net loss per share, basic and diluted     6,660,662                           6,660,662    

The Pro Forma adjustments to the unaudited pro forma condensed consolidated financial statements assume these transactions occurred on January 1, 2002 as follows:


75

BOSTON BIOMEDICA, INC.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED
STATEMENT OF OPERATIONS
For the Year Ended December 31, 2001

 
   Consolidated
Boston Biomedica, Inc. as Reported
December 31, 2001
   Adjusted
BBI Diagnostics
Excluding PCT
Activities and
Intercompany
Sales from BBIDX to Other BBI Entities
   Adjusted
BBI Biotech
Research
Laboratories, Inc.
Excluding PCT
Activities and
Intercompany Sales
From Biotech to
Other BBI Entities
   Pro Forma
Adjustments and
Reclassifications
   Footnote
   Pro Forma Subtotal Corp., PCT, BBI Bioseq and Source Scientific
   Footnote
REVENUE:                                      
  Products   $ 13,092,771   $ 10,971,651   $ 226,618   $ —       $ 1,894,502    
  Services     8,733,336     488,781     7,746,475     —         498,080    
   
 
 
 
     
   
    Total revenue     21,826,107     11,460,432     7,973,093     —   1,5     2,392,582    
   
 
 
 
     
   
COSTS AND EXPENSES:                                      
  Cost of products     6,337,437     4,993,607     (11,692 )   —         1,355,522    
  Cost of services     6,783,329     279,875     6,069,047     —         434,407    
  Research and development     2,303,350     426,750     869,569     —         1,007,031    
  Selling and marketing     2,916,013     2,631,728     —     —         284,285    
  General and administrative     3,976,568     1,454,448     1,258,267     276,241   2,3,6     1,540,094   7
   
 
 
 
     
   
    Total operating costs and expenses     22,316,697     9,786,408     8,185,191     276,241         4,621,339    
   
 
 
 
     
   
    Operating income (loss)     (490,590 )   1,674,024     (212,098 )   (276,241 )       (2,228,757 )  

Net Interest Expense (income)
 
 
380,493
 
 
241,766
 
 
7,032
 
 
—
 
 
 
 
131,695
 
 
   
 
 
 
     
   
    Income (Loss) before income taxes     (871,083 )   1,432,258     (219,130 )   (276,241 )       (2,360,452 )  

Benefit from (Provision for) income taxes
 
 
(15,678
)
 
(544,258
)
 
83,270
 
 
(270,446
)
4
 
 
174,864
 
 
   
 
 
 
     
   
    Net income (loss) from continuing operations*   $ (886,761 ) $ 888,000   $ (135,860 ) $ (546,687 )     $ (2,185,588 )*  
   
 
 
 
     
   
* Excludes $135,000 gain from discontinued operations—clinical laboratory segment.          
Net loss per share, basic & diluted, from continuing operations   $ (0.14 )                       $ (0.35 )  
Number of shares used to calculate net loss per share, basic and diluted     6,204,384                           6,204,384    

The Pro Forma adjustments to the unaudited pro forma condensed consolidated financial statements assume these transactions occurred on January 1, 2001 as follows:

76

Vote Required and Board Recommendation

        The approval of the sale of the assets of our BBI Core Businesses to SeraCare requires the affirmative vote of two-thirds of the shares of our common stock outstanding and entitled to vote at the special meeting. As described above under the section entitled "—Voting Agreements" certain stockholders who hold as of the record date an aggregate of 2,824,189 shares of our common stock (approximately 32% of the outstanding shares entitled to vote at the special meeting on the record date) have entered into voting agreements pursuant to which they have agreed to vote their shares in favor of the sale to SeraCare.

        Our board of directors unanimously believes that the proposed sale to SeraCare pursuant to the asset purchase agreement is in the best interests of our company and our stockholders and unanimously recommends that stockholders vote "FOR" the proposal to sell the assets of our BBI Core Businesses to SeraCare pursuant to the asset purchase agreement, including the transactions contemplated thereby.


PROPOSAL NO. 2

CORPORATE NAME CHANGE

General

        In connection with the sale of assets to SeraCare, we have agreed to change our corporate name to a name that does not include the words "Boston Biomedica," or any derivations thereof. Under Massachusetts law, a change in our corporate name requires an amendment to our Restated Articles of Organization, as amended. Our board of directors has approved and is recommending to stockholders for their approval a proposal to amend our Restated Articles of Organization, as amended, to change our name from "Boston Biomedica, Inc." to "Pressure BioSciences, Inc."

        To effect the corporate name change we would file Articles of Amendment to our Restated Articles of Organization, as amended, to insert the name "Pressure BioSciences, Inc." in lieu of Boston Biomedica, Inc. If the amendment to change our corporate name is approved by our stockholders we would expect to file the Articles of Amendment to effect the corporate name change with the Secretary of State of the Commonwealth of Massachusetts as soon as practicable, subject to the closing of the sale of our BBI Core Businesses to SeraCare. The name change will become effective upon the filing of the Articles of Amendment with the Secretary of State of the Commonwealth of Massachusetts. In the event that the sale to SeraCare is not completed, our board of directors has reserved the right to abandon the amendment and retain the name "Boston Biomedica, Inc." Because Proposal No. 2 is only relevant if Proposal No. 1 is approved, the approval of Proposal No. 2 necessitates the approval of Proposal No. 1. In the event that Proposal No. 1 is approved, but Proposal No. 2 is not approved, we will discuss with SeraCare alternative arrangements to ensure that SeraCare receives the benefit of our corporate name "Boston Biomedica".

        Massachusetts law does not offer stockholders appraisal rights in connection with a change in the corporate name.

Vote Required

        The proposal to change our name by amending our Restated Articles of Organization, as amended, requires the affirmative vote of the holders of a majority of the shares of our common stock outstanding and entitled to vote. As described above under the section entitled "—Voting Agreements" certain stockholders who hold as of the record date an aggregate of 2,824,189 shares of our common stock (approximately 32.0% of the outstanding shares entitled to vote at the special meeting on the record date) have entered into voting agreements pursuant to which they have agreed to vote their

77


shares in favor of the transactions contemplated by the asset purchase agreement, which includes the amendment to our Restated Articles of Organization, as amended, to change our corporate name.

        Our board of directors unanimously recommends that you vote "FOR" the proposal to amend our Restated Articles of Organization, as amended, to change our name to Pressure BioSciences, Inc.


PROPOSAL NO. 3

GRANT OF DISCRETIONARY AUTHORITY TO ADJOURN THE SPECIAL MEETING TO SOLICIT ADDITIONAL PROXIES

        Although it is not expected, the special meeting may be adjourned for the purpose of soliciting additional proxies. Any such adjournment of the special meeting may be made without notice, other than by the announcement made at the special meeting, by approval of the holders of a majority of the shares of our common stock present in person or by proxy and entitled to vote at the special meeting, whether or not a quorum exists. We are soliciting proxies to grant discretionary authority to the persons named as proxies to adjourn the special meeting for the purpose of soliciting additional proxies in favor of Proposal Nos. 1 or 2. The individuals to whom proxies are granted will have the discretion to decide whether or not to use the authority granted to them pursuant to Proposal No. 3 to adjourn the special meeting.

Vote Required

        Approval of the adjournment proposal requires the affirmative vote of the holders of a majority of the shares of our common stock present in person or by proxy and entitled to vote at the special meeting, whether or not a quorum exists.

        Our board of directors unanimously recommends that you vote "FOR" the proposal to grant management the discretionary authority to adjourn the special meeting to solicit additional proxies in favor of Proposal Nos. 1 or 2.


STOCK OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

        The following table sets forth certain information with respect to the beneficial ownership of our common stock as of April 30, 2004 by each person known to us to beneficially own more than 5% of our common stock, by each director, named executive officers, and by all officers and directors as a group. Under SEC rules, a person is deemed to be a "beneficial owner" of a security if that person has or shares "voting power," which includes the power to vote or to direct the voting of such security, or "investment power," which includes the power to dispose or to direct the disposition of such security. The number of shares beneficially owned also includes any shares the person has the right to acquire

78


within the next 60 days. Unless otherwise indicated, each person is the record owner of and has sole voting and investment power over his or her shares.

Name
   Number of Shares of
Common Stock
Beneficially Owned
   Percent of Class
  
Richard T. Schumacher(1)(5)*
65 Black Pond Road
Taunton, MA 02780		   750,297   10.81 %
Kevin W. Quinlan(1)   135,744   1.95 %
Mark M. Manak, Ph.D.(1)(2)   65,257   **  
Kathleen W. Benjamin(1)   23,916   **  
Richard J. D'Allessandro(1)   17,250   **  
Calvin A. Saravis, Ph.D.(1)   45,540   **  
R. Wayne Fritzsche(1)   1,250   **  
J. Donald Payne(1)   11,250   **  
P. Thomas Vogel(1)   11,250   **  
All Executive Officers and Directors as a group (12 Persons)(1)(2)   1,156,932   15.97 %
Richard P. Kiphart(3)*
c/o William Blair & Company, L.L.C.
222 West Adams Street
Chicago IL 60606		   1,542,989 (3)(4) 22.60 %
Shoreline Micro-Cap Fund I LP(4)*
c/o William Blair & Company, L.L.C.
222 West Adams Street
Chicago, IL 60606		   365,613 (4) 5.35 %
*
Address provided for beneficial owners of more than 5% of the Common Stock.

**
Less than 1% of the outstanding Common Stock.

(1)
Includes the following shares issuable upon exercise of options exercisable within 60 days after April 30, 2004: Mr. Schumacher—67,500; Mr. Quinlan—104,000; Dr. Manak—36,750; Ms. Benjamin—22,250; Mr. D'Allessandro—16,250; Dr. Saravis—34,584; Mr. Fritzsche—1,250; Mr. Payne—11,250; Mr. Vogel—11,250; all other Executive Officers—66,875. 629,957 of Mr. Schumacher's shares of stock have been pledged to a financial institution.

(2)
Includes 4,000 shares held of record by Dr. Manak's daughter and 24,507 shares held in Dr. Manak's name.

(3)
Includes 90,000 shares held by Rebecca Kiphart (Mr. Kiphart's daughter), and also currently exercisable warrants (expiring August 2005) to purchase 27,734 shares of common stock. This amount also includes 365,613 shares beneficially owned by Shoreline Micro-Cap Fund I LP described in Note 4 below.

(4)
Includes 357,791 shares, and also currently exercisable warrants (expiring August 2005) to purchase 7,822 shares of common stock, held by Shoreline Micro-Cap Fund I LP, a fund of which Mr. Kiphart serves as general partner and has the sole power to vote and dispose or direct the disposition of shares held by Shoreline Micro-Cap Fund I LP.

(5)
Includes 20,473 shares and 24,417 options held by Mr. Schumacher's spouse.

79


PROPOSALS OF STOCKHOLDERS

        Proposals which stockholders intend to present at our 2004 annual meeting of stockholders and wish to have included in our proxy materials pursuant to Rule 14a-8 promulgated under the Securities Exchange Act of 1934, as amended, must be received by us no later than August 6, 2004.

        Stockholders who wish to make a proposal at our 2004 annual meeting—other than one that will be included in our proxy materials—should notify us no later than August 16, 2004. If a proponent who wishes to present such a proposal at the 2004 annual meeting fails to notify us by this date, the proxies solicited by our board of directors, with respect to such meeting, may grant discretionary authority to the proxies named therein, to vote with respect to such matter if such matter is properly brought before the meeting. If a stockholder makes a timely notification, the proxies may still exercise discretionary authority under circumstances consistent with the proxy rules of the SEC.


OTHER MATTERS

        Our board of directors is not aware of any matter to be presented for action at the special meeting other than the matters set forth herein. Should any other matter requiring a vote of stockholders arise, the proxies in the enclosed form confer upon the person or persons entitled to vote the shares represented by such proxies discretionary authority to vote the same in accordance with their best judgment in the interest of our company.


ADDITIONAL INFORMATION

        We are subject to the reporting requirements of the Securities Exchange Act of 1934, as amended, and we file reports, proxy statements and other information with the SEC. You may read and copy any materials we file with the SEC at the SEC's public reference room at 450 Fifth Street, N.W., Washington, DC 20549. Please call the SEC at 1-800-SEC-0330 for further information on the public reference room. Our public filings are also available to the public from commercial document retrieval services and at the Internet website maintained by the SEC at http://www.sec.gov.

        In conjunction with this proxy statement, we are sending you a copy of our Annual Report on Form 10-K for the fiscal year ended December 31, 2003, our Quarterly Report on Form 10-Q for the quarter ended March 31, 2004, Amendment No. 1 to our Annual Report on Form 10-K/A for the fiscal year ended December 31, 2003, our Current Report on Form 8-K dated April 16, 2004 and our Current Report on Form 8-K dated June 16, 2004, all of which are incorporated herein by this reference.

    By Order of the Board of Directors

 
 
Kathleen W. Benjamin, Clerk

August 13, 2004
 
 

80

Appendix A

ASSET PURCHASE AGREEMENT

by and between

Boston Biomedica, Inc. ("Parent") and
BBI Biotech Research Laboratories, Inc. ("BBI Biotech")

(collectively "Seller"),

and

SeraCare Life Sciences, Inc.

as "Buyer"

Dated: April 16, 2004

A-1

ASSET PURCHASE AGREEMENT

TABLE OF CONTENTS

 
    
   Page
ARTICLE I   DEFINITIONS   A-6
  1.1   Defined Terms   A-6
  1.2   Other Defined Terms   A-12

ARTICLE II
 
PURCHASE AND SALE OF ASSETS
 
A-14
  2.1   Transfer of Assets   A-14
  2.2   Assumption of Liabilities   A-14
  2.3   Excluded Liabilities   A-14
  2.4   Purchase Price   A-16
  2.5   Post-Closing Adjustment   A-16
  2.6   Inventory Procedures   A-18
  2.7   Prorations   A-18
  2.8   Closing Costs; Transfer Taxes and Fees   A-19
  2.9   Government Contracts   A-19

ARTICLE III
 
CLOSING
 
A-21
  3.1   Closing   A-21
  3.2   Conveyances at Closing   A-21

ARTICLE IV
 
REPRESENTATIONS AND WARRANTIES OF SELLER
 
A-23
  4.1   Organization of Seller   A-23
  4.2   Subsidiaries   A-23
  4.3   Authorization   A-23
  4.4   Absence of Certain Changes or Events   A-23
  4.5   Assets   A-25
  4.6   Facilities   A-25
  4.7   Contracts and Commitments   A-26
  4.8   Permits   A-28
  4.9   No Conflict or Violation   A-29
  4.10   SEC Filings; Financial Statements   A-29
  4.11   Books and Records   A-30
  4.12   Litigation   A-30
  4.13   Labor Matters   A-31
  4.14   Liabilities   A-32
  4.15   Compliance with Law   A-32
  4.16   No Brokers   A-32
  4.17   No Other Agreements to Sell the Purchased Assets   A-32
  4.18   Proprietary Rights   A-33
  4.19   Employee Benefit Plans   A-33
  4.20   Transactions with Certain Persons   A-36
  4.21   Tax Matters   A-36
  4.22   Insurance   A-37
  4.23   Accounts Receivable   A-38
  4.24   Inventory   A-38
  4.25   Purchase Commitments and Outstanding Bids   A-38
  4.26   Payments   A-38
  4.27   Customers, Distributors and Suppliers   A-38
         

A-2

  4.28   Compliance With Environmental Laws   A-39
  4.29   Minute Books   A-41
  4.30   State Takeover Statutes   A-41
  4.31   Fairness Opinion   A-41
  4.32   Accuracy of Information   A-41
  4.33   Product Returns and Warranties   A-41

ARTICLE V
 
REPRESENTATIONS AND WARRANTIES OF BUYER
 
A-42
  5.1   Organization of Buyer   A-42
  5.2   Authorization   A-42
  5.3   No Conflict or Violation   A-42
  5.4   No Brokers   A-43
  5.5   SEC Filings   A-43
  5.6   Financial Resources   A-43

ARTICLE VI
 
COVENANTS OF SELLER AND BUYER
 
A-44
  6.1   Further Assurances   A-44
  6.2   No Solicitation   A-44
  6.3   Notification of Certain Matters   A-46
  6.4   Investigation by Buyer   A-47
  6.5   Conduct of Business   A-47
  6.6   Employee Matters   A-49
  6.7   Proxy Statement; Special Meeting   A-50
  6.8   Financing   A-52
  6.9   Notices   A-52
  6.10   Financial Reporting Cooperation   A-52
  6.11   Compliance with Bulk Sales Laws Requirements   A-52
  6.12   Seller's Covenant Not to Compete   A-52
  6.13   Retention Program   A-53
  6.14   Assumption of Mortgage   A-54
  6.15   Frederick Lease   A-54
  6.16   Incomplete Contracts   A-54

ARTICLE VII
 
CONDITIONS TO SELLER'S OBLIGATIONS
 
A-54
  7.1   Representations and Warranties   A-54
  7.2   Agreements and Covenants   A-54
  7.3   Consents; Regulatory Compliance and Approval   A-54
  7.4   No Actions or Court Orders   A-54
  7.5   Opinion of Counsel   A-55
  7.6   Corporate Documents   A-55
  7.7   Assumption Document   A-55
  7.8   Ancillary Agreements   A-55
  7.9   Stockholder Approval   A-55
  7.10   401(k)   A-55
  7.11   Mortgage   A-55
  7.12   Employees   A-55

ARTICLE VIII
 
CONDITIONS TO BUYER'S OBLIGATIONS
 
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  8.1   Representations, Warranties and Covenants   A-55
  8.2   Agreements and Covenants   A-55
  8.3   Consents; Regulatory Compliance and Approval   A-56
  8.4   No Actions or Court Orders   A-56
         

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  8.5   Opinion of Counsel   A-56
  8.6   Material Changes   A-56
  8.7   Corporate Documents   A-56
  8.8   Conveyancing Documents; Release of Encumbrances   A-56
  8.9   Ancillary Agreements   A-56
  8.10   Financing   A-56
  8.11   Stockholder Approval   A-56
  8.12   Title Insurance   A-56
  8.13   Know-How   A-56

ARTICLE IX
 
CONSENTS TO ASSIGNMENT
 
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  9.1   Consents to Assignment   A-57

ARTICLE X
 
ACTIONS BY SELLER AND BUYER AFTER THE CLOSING
 
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  10.1   Collection of Accounts Receivable and Letters of Credit   A-57
  10.2   Books and Records; Tax Matters   A-57
  10.3   Survival of Representations, Etc.   A-58
  10.4   Indemnifications   A-58

ARTICLE XI
 
TERMINATION
 
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  11.1   Termination   A-61
  11.2   Notice of Termination; Effect of Termination   A-62
  11.3   Fees and Expenses   A-62

ARTICLE XII
 
MISCELLANEOUS
 
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  12.1   Assignment   A-63
  12.2   Notices   A-63
  12.3   Choice of Law   A-64
  12.4   Entire Agreement; Amendments and Waivers   A-64
  12.5   Multiple Counterparts   A-65
  12.6   Expenses   A-65
  12.7   Invalidity   A-65
  12.8   Titles; Gender   A-65
  12.9   Publicity   A-65
  12.10   Confidential Information   A-65
  12.11   Cumulative Remedies   A-66
  12.12   Specific Performance   A-66
  12.13   Arbitration   A-66
         

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EXHIBITS    
Exhibit        
  A   Facilities   A-1
  B   Escrow Agreement   B-1
  C   Reserved   C-1
  D   Deed   D-1
  E   Bill of Sale   E-1
  F   Assignment of Leases   F-1
  G   Assignment of Contract Rights   G-1
  H   Assignment of Patents and Trademarks   H-1
  I   Assumption of Certain Liabilities   I-1
  J   Reserved   J-1
  K   Reserved   K-1
  L   Agreement Not to Compete   L-1
  M   Form of Legal Opinion of Buyer's Counsel   M-1
  N   Form of Legal Opinion of Seller's Counsel   N-1
  O   Title Insurance Policy on the Owned Real Property   O-1
  P   Stockholder Voting Agreement   P-1
  Q   Transition Services Agreement   Q-1

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ASSET PURCHASE AGREEMENT

        This Asset Purchase Agreement, dated as of April 16, 2004, is by and among Boston Biomedica, Inc., a Massachusetts corporation ("Parent") and BBI Biotech Research Laboratories, Inc., a Massachusetts corporation ("BBI Biotech", and together with Parent, the "Seller"), and SeraCare Life Sciences, Inc., a California corporation ("Buyer").

RECITALS

        A.    Seller owns certain assets which it uses in the conduct of the Business (as defined below). BBI Biotech is a wholly owned subsidiary of Parent.

        B.    Buyer desires to purchase from Seller, and Seller desires to sell to Buyer, such assets upon the terms and subject to the conditions of this Agreement.

AGREEMENT

        NOW THEREFORE, in consideration of the respective covenants and promises contained herein and for other good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, the parties hereto agree as follows:

ARTICLE I

DEFINITIONS

        1.1    Defined Terms.    As used herein, the terms below shall have the following meanings. Any of such terms, unless the context otherwise requires, may be used in the singular or plural, depending upon the reference.

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        1.2    Other Defined Terms.    The following terms shall have the meanings defined for such terms in the Sections set forth below:

Term
   Section
  
Adjustment Amount   2.5(b )
Acquisition Proposal   6.2(c )
Acquisition Transaction   6.2(c )
Assumed Liabilities   2.2  
Assumption Document   3.2(b )
Benefit Arrangement   4.19(a )
BBI Biotech   Recitals  
Buyer   Recitals  
Buyer SEC Filings   5.5(a )
CERCLA   4.28(a )
Claim   10.4(d )
Claim Notice   10.4(d )
Closing   3.1  
Closing Balance Sheet   2.5(a )
Closing Net Asset Value   2.5(b )
Commitment Letters   5.6  
Confidential Information   12.1(b )
Damages   10.4(a )
Defaulting Party   11.3  
Employee Plans   4.19(a )
Environmental Conditions   4.28(a )
Environmental Laws   4.28(a )
ERISA   4.19(a )
ERISA Affiliate   4.19(a )
Escrow Agreement   2.4(b )
Escrowed Amount   2.4(b )
Estimated Adjustment Amount   2.4(c )
Evaluation Date   4.11  
Exchange Act   4.10(a )
       

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Excluded Liabilities   2.3  
Expenses   11.3  
FAR   2.9(e )
Financial Statements   4.10(b )
Financing   6.9  
GAAP   4.10(b )
Government Contracts   2.9(a )
Hazardous Substance   4.28(a )
Incomplete Contracts   6.16  
Independent Accountant   2.5(d )
Inventory Service   2.6  
JAMS   12.13  
Long-term Government Contracts   2.9(b )
Objection Notice   2.5(d )
Outside Date   11.1(b )
Parent   Recitals  
Parent SEC Filings   4.10(a )
Parent Stockholders   6.7(a )
Proper Authorities   2.9(e )
Proxy Statement   6.7(a )
Purchase Price   2.4(a )
RCRA   4.28(a )
Release   4.28(a )
Rehired Employee   6.6(a )
SEC   4.10(a )
Securities Act   4.10(a )
Short-term Government Contracts   2.9(b )
SOPs   8.13  
Special Meeting   6.7(a )
Stockholder Approval Matters   6.7(a )
Superior Offer   6.2(b )
Target Net Asset Value   2.5(b )
Termination Fee   11.3  
Triggering Event   11.1(i )
WARN Act   4.12(d )
Welfare Plan   4.19(a )
Work   2.9(f )

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ARTICLE II

PURCHASE AND SALE OF ASSETS

        2.1    Transfer of Assets.    Upon the terms and subject to the conditions contained herein, at the Closing, Seller will sell, convey, transfer, assign and deliver to Buyer, and Buyer will acquire from Seller, the Purchased Assets, free and clear of all Encumbrances.

        2.2    Assumption of Liabilities.    Upon the terms and subject to the conditions contained herein, at the Closing, Buyer shall assume the following, and only the following, Liabilities of Seller (the "Assumed Liabilities"):

The assumption by Buyer of the Assumed Liabilities shall not expand the rights or remedies of any third party against Buyer or Seller as compared to the rights or remedies which such third party would have had against Seller had Buyer not assumed the Assumed Liabilities. Without limiting the generality of the preceding sentence, the assumption by Buyer of the Assumed Liabilities shall not create any third party beneficiary rights.

        2.3    Excluded Liabilities.    Notwithstanding any other provision of this Agreement, except for the Assumed Liabilities expressly specified in Section 2.2, Buyer shall not assume, or otherwise be responsible for, any Liabilities of Seller, whether liquidated or unliquidated, or known or unknown, whether arising out of occurrences prior to, at or after the date hereof ("Excluded Liabilities"). Seller shall remain liable for and shall discharge the Excluded Liabilities. Without limiting the generality of the foregoing, the Excluded Liabilities include, without limitation:

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        2.4    Purchase Price.    

        2.5    Post-closing Adjustment.    

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        2.6    Inventory Procedures.    Within five days of Closing, the quantities of Inventory to be purchased and sold hereunder shall be determined by an itemized inventory to be taken at such time as Buyer and Seller mutually agree and shall be adjusted to book as of the Closing Date based upon a physical inventory pursuant to which all Inventory will be counted as to quantity and value by personnel of Seller and Buyer using the same procedures normally used by Seller to take inventories of the type of Inventory being counted consistent with the Past Practices (a written copy of such procedures has been provided by Seller to Buyer and is attached as Schedule 1.1(P)); provided, that if Buyer and Seller shall mutually agree, an outside inventory service or services (the "Inventory Service") mutually selected by Seller and Buyer may be selected to take such inventory. The Inventory Service shall follow GAAP and the Past Practices in taking such inventory. Both Buyer and Seller will have the right to have Representatives present to observe the physical inventories. Any disputes as to the physical count of any item of Inventory will, if possible, be resolved while such physical inventory is being taken. Any unresolved disputes regarding the physical count of any item of Inventory not resolved by the Closing Date will be separately listed and settled as soon as expeditiously practicable thereafter by the parties or by another independent third party mutually acceptable to both parties, or if they are unable to agree then by the Inventory Service. The determination of any third party so engaged shall be final and binding on the parties. The fees and expenses of the Inventory Service shall be borne by Buyer and Seller equally. Any disputes as to the usability, valuation or salability of any item of Inventory will be resolved in connection with the determination of the Closing Net Asset Value, or sooner if the parties can so agree. Any unresolved disputes with respect to the usability, valuation or salability of any item of Inventory will be referred to the Independent Accountant and resolved pursuant to the procedures set forth in Section 2.5(d) as if the amount was the subject of an Objection Notice. The Independent Accountant shall follow GAAP and the Past Practices in determining the usability, valuation or salability of any item of Inventory and the determination of the Independent Accountant on any such matter shall be final and binding on the parties.

        2.7    Prorations.    

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        2.8    Closing Costs; Transfer Taxes and Fees.    Seller shall be responsible for any documentary and transfer Taxes and any sales, use or other Taxes imposed by reason of the transfers of Purchased Assets provided hereunder and any deficiency, interest or penalty asserted with respect thereto. Buyer shall pay the fees and costs of recording or filing all applicable conveyancing instruments described in Section 3.2(a). Buyer shall pay the costs of any title searches or insurance premiums for title insurance to be obtained by Buyer with respect to the Owned Real Property. Buyer shall pay all costs of applying for new Permits and Seller shall pay the costs incurred prior to Closing to transfer all of the existing Permits which may be lawfully transferred to Buyer at the Closing.

        2.9    Government Contracts.    

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ARTICLE III

CLOSING

        3.1    Closing.    The Closing of the transactions contemplated herein (the "Closing") shall be held at 10:00 a.m. local time on the Closing Date at the offices of O'Melveny & Myers LLP, 114 Pacifica, Suite 100, Irvine, California 92618, unless the parties hereto otherwise agree.

        3.2    Conveyances at Closing.    

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ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF SELLER

        Parent and BBI Biotech, jointly and severally, hereby represent and warrant to Buyer as follows, except as otherwise set forth on the Disclosure Schedule.

        4.1    Organization of Seller.    Each of Parent and BBI Biotech is a corporation duly organized, validly existing and in good standing under the laws of the Commonwealth of Massachusetts with full corporate power and authority to conduct the Business as it is presently being conducted and to own and lease its properties and assets. Each of Parent and BBI Biotech is duly qualified to do business as a foreign corporation and is in good standing in each jurisdiction where the character of its properties owned or leased or the nature of its respective activities make such qualification necessary, except where the failure to be so qualified or in good standing would not have a Material Adverse Effect. True and complete copies of the Articles of Incorporation and Bylaws of each of Parent and BBI Biotech, and all amendments thereto, have been delivered Seller to Buyer. Schedule 4.1 contains a true, correct and complete list of all jurisdictions in which Parent or BBI Biotech is qualified to do business as a foreign corporation.

        4.2    Subsidiaries.    Except for BBI Biotech, Seller does not have any Subsidiaries which participate in the conduct of the Business or which own any of the Purchased Assets. BBI Source Scientific, Inc. does not own any assets that relate to the Business.

        4.3    Authorization.    Seller has all requisite corporate power and authority, and except for obtaining approval of Parent's stockholders, has taken all corporate action necessary, to execute and deliver this Agreement, to consummate the transactions contemplated hereby and to perform its obligations hereunder. Seller has all requisite corporate power and authority and has taken all corporate action necessary, to execute and deliver the Ancillary Agreements to which it is a party, to consummate the transactions contemplated thereby and to perform its obligations thereunder. The execution and delivery of this Agreement and the Ancillary Agreements by the Seller and the consummation by the Seller of the transactions contemplated hereby and thereby have been duly approved by the board of directors. Except for obtaining approval of Parent's stockholders, no other corporate proceedings on the part of Seller are necessary to authorize this Agreement and the Ancillary Agreements and the transactions contemplated hereby and thereby. This Agreement has been duly executed and delivered by the Seller and constitutes the legal, valid and binding obligations of the Seller enforceable against Seller in accordance with its terms, except as limited by (i) applicable bankruptcy, insolvency, reorganization, moratorium or other laws of general application affecting enforcement of creditors' rights and (ii) general principles of equity that restrict the availability of equitable remedies (regardless of whether enforceability is considered in a proceeding in equity or at law). Each of the Ancillary Agreements to which Seller is a party, upon their execution and delivery by the Seller, will constitute the legal, valid and binding obligations of the Seller enforceable against Seller in accordance with its terms, except as limited by (i) applicable bankruptcy, insolvency, reorganization, moratorium or other laws of general application affecting enforcement of creditors' rights and (ii) general principles of equity that restrict the availability of equitable remedies (regardless of whether enforceability is considered in a proceeding in equity or at law). The affirmative vote of the holders of at least two-thirds of the shares of Parent's common stock outstanding and entitled to vote at the Special Meeting is the only vote of the holders of any of Parent's or BBI Biotech's capital stock necessary to approve and adopt this Agreement, the Ancillary Agreements and the transactions contemplated hereby and thereby.

        4.4    Absence of Certain Changes or Events.    Since the Balance Sheet Date, except as set forth on Schedule 4.4, there has not been any:

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        4.5    Assets.    Excluding the Owned Real Property and the Leased Real Property, Seller has and will transfer good and marketable title to the Purchased Assets and upon the consummation of the transactions contemplated hereby, Buyer will acquire good and marketable title to all of the Purchased Assets, free and clear of any Encumbrances. At the Closing, Seller will transfer title to the Owned Real Property to Buyer free and clear of any Encumbrances other than Permitted Encumbrances. The Purchased Assets, including the Owned Real Property and the Leased Real Property, include without limitation all assets reasonably necessary for the conduct of the Business. Schedule 4.5 contains accurate lists of all Purchased Assets, excluding the Owned Real Property and the Leased Real Property, where the value of an individual item exceeds $2,500.00 or where an aggregate of similar items exceeds $10,000.00. To Seller's knowledge and except as set forth on Schedule 4.5, all tangible assets and properties included on the Balance Sheet at a value of at least $25,000 per asset, reasonably necessary for the conduct of the Business which are part of the Purchased Assets, excluding the Owned Real Property and the Leased Real Property, are in good operating condition and repair and are usable in the ordinary course of the Business and conform in all material respects to all applicable Regulations (including Environmental Laws) relating to their construction, use and operation. To Seller's knowledge and except as set forth on Schedule 4.5, all other tangible assets and properties reasonably necessary for the conduct of the Business which are part of the Purchased Assets, excluding the Owned Real Property and the Leased Real Property, are in operating condition and repair and are usable in the ordinary course of the Business and conform in all material respects to all applicable Regulations (including Environmental Laws) relating to their construction, use and operation.

        4.6    Facilities.    Schedule 4.6 contains a complete and accurate list of all Owned Real Property.

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        4.7    Contracts and Commitments.    

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Except for the Incomplete Contracts, Seller has delivered to Buyer true, correct and complete copies of all of the written Contracts and Leases listed on Schedule 4.7, including all amendments and supplements thereto.

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        4.8    Permits.    

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        4.9    No Conflict or Violation.    The execution, delivery and performance of this Agreement and each of the Ancillary Agreements to which Seller is a party, the consummation of the transactions contemplated hereby and thereby, and compliance by Parent or BBI Biotech with any of the provisions hereof or thereof, will not (a) violate or conflict with any provision of the Articles of Incorporation or Bylaws of Parent or BBI Biotech, (b) except as set forth in Schedule 4.9, violate, conflict with, or result in or constitute a material Default under, or result in the termination of, trigger a material penalty provision under, or accelerate the performance required by, or result in a right of termination or acceleration under, or otherwise accelerate any obligation of Seller under any of the terms, conditions or provisions of any material Contract, Lease or Permit, (c) result in the imposition of any Encumbrance against any assets or properties of the Seller or any of the Purchased Assets, or (d) violate any Regulation or Court Order.

        4.10    SEC Filings; Financial Statements.    

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        4.11    Books and Records.    Seller has made and kept (and given Buyer access to) Books and Records and accounts, which, in reasonable detail, accurately and fairly reflect in all material respects the activities of Seller pertaining to the Business and the Purchased Assets. In connection with the operation of the Business, Seller has not engaged in any transaction, maintained any bank account or used any corporate funds except for transactions, bank accounts and funds which have been and are reflected in the normally maintained Books and Records of Seller. Seller maintains internal controls over financial reporting (as defined in Exchange Act Rule 13a-15(f)), which provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP. Parent maintains disclosure controls and procedures (as defined in Exchange Act Rule 13a-15(e)). As of the Balance Sheet Date, Parent carried out an evaluation, under the supervision and with the participation of Parent's management, including its President (Principal Executive Officer and Principal Financial Officer) of the effectiveness of the design and operation of Parent's disclosure controls and procedures and, based upon that evaluation, the certifying officer concluded that Parent's disclosure controls and procedures are effective in enabling Parent to record, process, summarize and report information required to be included in Parent's periodic reports filed with the SEC within the required time period. Since the Balance Sheet Date, there have been no changes in Seller's internal controls over financial reporting that have materially affected or are reasonably likely to materially affect, Seller's internal control over financial reporting.

        4.12    Litigation.    Except as set forth on Schedule 4.12, there are no Actions pending, or to the Seller's knowledge threatened (a) against, related to or affecting (i) the Business or the Purchased Assets (including with respect to Environmental Laws), or (ii) any officers or directors of Seller, (b) seeking to delay, limit or enjoin the transactions contemplated by this Agreement or (c) in which

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Seller is a plaintiff, including any derivative suits brought by or on behalf of Seller. Seller is not in Default with respect to or subject to any Court Order, and there are no unsatisfied judgments against Seller, the Business or the Purchased Assets. There are no Court Orders or agreements with, or liens by, any governmental authority or quasi-governmental entity relating to any Environmental Law which regulate, obligate, bind or in any way affect Seller, the Purchased Assets, any Facility or any Former Facility.

        4.13    Labor Matters.    

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        4.14    Liabilities.    Other than the Assumed Liabilities and the Excluded Liabilities and as set forth on Schedule 4.14, Seller has no Liabilities relating to the Business due or to become due, except (a) Liabilities which are set forth or reserved for on the Balance Sheet, which have not been paid or discharged since the Balance Sheet Date, (b) Liabilities arising in the ordinary course of business relating to the Business under Contracts, Leases, Permits and other business arrangements described in the Disclosure Schedule (and under those Contracts, Leases and Permits which are not required to be disclosed on the Disclosure Schedule), arising prior to Closing none of which, individually or in the aggregate, has or would have a Material Adverse Effect on the Business or the Purchased Assets and (c) Liabilities incurred since the Balance Sheet Date in the ordinary course of business relating to the Business and in accordance with this Agreement and none of which, individually or in the aggregate, has or would have a Material Adverse Effect on the Business or the Purchased Assets.

        4.15    Compliance with Law.    Seller's conduct of the Business has not violated and is in compliance with all Regulations and Court Orders relating to the Purchased Assets or the Business or operations of Seller relating to the Business, the failure to comply with which would have a Material Adverse Affect. Seller has not received any notice to the effect that, or otherwise been advised that, it is not in compliance with any such Regulations or Court Orders.

        4.16    No Brokers.    Except as set forth in the Schedule 4.16, neither Parent, BBI Biotech nor any of their respective Affiliates or Representatives has employed or made any agreement with any broker, finder or similar agent or any person or firm which will result in the obligation of Buyer or any of its Affiliates to pay any finder's fee, brokerage fees or commission or similar payment in connection with the transactions contemplated hereby.

        4.17    No Other Agreements to Sell the Purchased Assets.    Neither Parent nor BBI Biotech nor any of their respective Affiliates or Representatives have any commitment or legal obligation, absolute or contingent, to any other person or firm other than the Buyer to sell, assign, transfer or effect a sale of any of the Purchased Assets, other than sales of inventory in the ordinary course of business.

        4.18    Proprietary Rights.    

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        4.19    Employee Benefit Plans.    

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        4.20    Transactions with Certain Persons.    Except as set forth in Schedule 4.20, no officer, or director of Seller nor any member of any such person's immediate family is presently, or within the past three years has been, a party to any transaction with Seller relating to the Business or the Purchased Assets of the type that would be required to be disclosed pursuant to Item 404 of Regulation S-K.

        4.21    Tax Matters.    

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        4.22    Insurance.    Schedule 4.22 contains a complete and accurate list of all policies or binders of fire, liability, title, worker's compensation, product liability and other forms of insurance maintained by Seller on the Business, the Purchased Assets or its employees involved in the Business. All such insurance coverage applicable to Seller, the Business and the Purchased Assets is in full force and effect, insures Seller in reasonably sufficient amounts against all risks usually insured against by persons operating similar businesses or properties of similar size in the localities where such businesses or properties are located, and provides coverage as may be required by applicable Regulation and by any and all Contracts to which Seller is a party. There is no material Default under any such coverage nor has there been any failure to give notice or present any claim under any such coverage in a due and timely fashion. There are no outstanding unpaid premiums except in the ordinary course of business and no notice of cancellation or nonrenewal of any such coverage has been received. There are no provisions in such insurance policies for retroactive or retrospective premium adjustments other than for normal ordinary course premium adjustments, all of which adjustments are Excluded Liabilities to the extent relating to periods prior to the Closing. All products liability, general liability and workers' compensation insurance policies maintained by Seller have been occurrence policies and not claims

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made policies. There are no outstanding performance bonds covering or issued for the benefit of the Seller. No insurer has advised Seller that it intends to reduce coverage, increase premiums or fail to renew existing policy or binder.

        4.23    Accounts Receivable.    Except as set forth in Schedule 4.23, the accounts receivable set forth on the Balance Sheet, and all accounts receivable arising since the Balance Sheet Date, represent bona fide claims of Seller against debtors for sales, services performed or other charges arising on or before the date hereof, and all the goods delivered and services performed which gave rise to said accounts were delivered or performed in all material respects in accordance with the applicable orders, Contracts or customer requirements and in the ordinary course of business. To Seller's knowledge, said accounts receivable are subject to no defenses, counterclaims or rights of setoff and are fully collectible in the ordinary course of business without cost in collection efforts therefor, except to the extent of the appropriate reserves for bad debts on accounts receivable as set forth on the Balance Sheet and, in the case of accounts receivable arising since the Balance Sheet Date, to the extent of a reasonable reserve rate for bad debts on accounts receivable which is not greater than the rate reflected by the reserve for bad debts on the Balance Sheet. Except as set forth on Schedule 4.23, since the Balance Sheet Date, Seller has not discounted or sold any of its accounts receivables or any portion thereof (either to the debtor(s) or in connection with the sale of such receivables to a third party).

        4.24    Inventory.    Schedule 4.24 contains a complete and accurate list of all Inventory set forth on the Balance Sheet and the addresses at which the Inventory is located. The Inventory as set forth on the Balance Sheet or arising since the Balance Sheet Date was acquired and has been maintained in accordance with the regular business practices of Seller, consists of new and unused items of a quality and quantity usable or saleable in the ordinary course of business, and is valued in accordance with GAAP at the lower of cost or market on a first-in-first-out basis consistent with the Past Practices. Except as set forth in Schedule 4.24, none of such Inventory is obsolete, unusable, damaged or unsalable in the ordinary course of business, except for such items of Inventory which have been written down to realizable market value, or for which adequate reserves have been provided, in the Balance Sheet.

        4.25    Purchase Commitments and Outstanding Bids.    As of the date of this Agreement, except as set forth on Schedule 4.25, there are no material claims against Seller in connection with the Business to return merchandise by reason of alleged overshipments, defective merchandise or otherwise, or of merchandise in the hands of customers under an understanding that such merchandise would be returnable. Except as set forth in Schedule 4.25, no outstanding purchase or outstanding Lease commitment of Seller relating to the Business presently is in excess of the normal, ordinary and usual requirements of the Business. There is no outstanding bid, proposal, Contract or unfilled order which relates to the Business or Purchased Assets which will or would, if accepted, have a Material Adverse Effect, individually or in the aggregate, on the Business or the Purchased Assets.

        4.26    Payments.    Seller has not, directly or indirectly, paid or delivered any fee, commission or other sum of money or item or property, however characterized, to any finder, agent, client, customer, supplier, government official or other party, in the United States or any other country, which is in any manner related to the Business or Purchased Assets, which is illegal under any federal, state or local laws of the United States (including without limitation the U.S. Foreign Corrupt Practices' Act) or any other country having jurisdiction; and Seller has not participated, directly or indirectly, in any boycotts or other similar practices affecting any of its actual or potential customers of the Business and has at all times done business in an open and ethical manner.

        4.27    Customers, Distributors and Suppliers.    Schedule 4.27 sets forth a complete and accurate list of the names and addresses of Seller's twenty largest (i) customers, distributors and other agents and representatives of or for the Business showing the approximate total sales in dollars by Seller to each such customer during the fiscal year ended December 31, 2003; and (ii) suppliers from whom Seller has

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purchased products or services for the Business in excess of $50,000 showing the approximate total purchases in dollars by Seller from each such supplier during such fiscal year. Except as set forth on Schedule 4.27, since the Balance Sheet Date, there has been no Material Adverse Change in the business relationship of Seller with any customer, distributor or supplier named on Schedule 4.27. Except as set forth on Schedule 4.27, Seller has not received any communication from any customer, distributor or supplier named on Schedule 4.27 of any intention to terminate or materially reduce purchases from or supplies to Seller.

        4.28    Compliance with Environmental Laws.    

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        4.29    Minute Books.    The minute books of Seller made available to Buyer contain a complete and accurate summary (as it relates to the Business or Purchased Assets) of all meetings of directors and stockholders or actions by written consent since January 1, 2000 through the date of this Agreement, and reflect all transactions (as they relate to the Business or Purchased Assets) referred to in such minutes accurately in all material respects.

        4.30    State Takeover Statutes.    Except as set forth on Schedule 4.30, neither Parent's Rights Plan nor any state takeover, business combination statute or similar statute or regulation applies to or purports to apply to this Agreement, any of the Ancillary Agreements or the transactions contemplated hereby and thereby.

        4.31    Fairness Opinion.    Parent has received a written opinion from its financial advisor, William Blair & Company, L.L.C., dated as of the date hereof, to the effect that as of the date hereof, the consideration to be received by Seller pursuant to this Agreement is fair, from a financial point of view, and has delivered to Buyer a copy of such opinion.

        4.32    Accuracy of Information.    Taken as a whole (i) all documents listed on Schedule 4.32, (ii) the representations and warranties in this Agreement and the Ancillary Agreements, and (iii) the information contained in the Disclosure Schedules is true and complete in all material respects and does not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements contained therein, in light of the circumstances under which they were made, not misleading.

        4.33    Product Returns and Warranties.    There are no liabilities for product returns other than those arising in the ordinary course of the Business or otherwise fully reserved for in the Financial Statements. Except as set forth in Schedule 4.33, to Seller's knowledge, there are no threatened claims for (a) product returns, (b) warranty obligations or (c) product services other than in the ordinary course of the Business. Except as set forth on Schedule 4.33, Seller has not made any express or implied warranties with respect to products sold or distributed by Seller (other than passing on warranties made by the manufacturers thereof). Seller has no knowledge of any presently existing circumstances that could reasonably be expected to constitute a valid basis for any voluntary or governmental recall of any product sold or distributed by Seller in the course of or that relates to the Business.

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ARTICLE V

REPRESENTATIONS AND WARRANTIES OF BUYER

        Buyer hereby represents and warrants to Seller as follows:

        5.1    Organization of Buyer.    Buyer is a corporation duly organized, validly existing and in good standing under the laws of the State of California.

        5.2    Authorization.    Buyer has all requisite power and authority, and has taken all corporate action necessary, to execute and deliver this Agreement and each of the Ancillary Agreements to which it is a party, to consummate the transactions contemplated hereby and thereby and to perform its obligations hereunder and thereunder. The execution and delivery of this Agreement and each of the Ancillary Agreements to which it is a party by Buyer and the consummation by Buyer of the transactions contemplated hereby and thereby have been duly approved by the board of directors of Buyer. Buyer is not required to obtain the approval of the shareholders of Buyer to execute and deliver this Agreement and the Ancillary Agreement or to consummate the transactions contemplated hereby and thereby. No other corporate proceedings on the part of Buyer are necessary to authorize this Agreement and each of the Ancillary Agreements to which it is a party and the transactions contemplated hereby and thereby. This Agreement has been duly executed and delivered by the Buyer and constitutes the legal, valid and binding obligations of the Buyer enforceable against Buyer in accordance with its terms, except as limited by (i) applicable bankruptcy, insolvency, reorganization, moratorium or other laws of general application affecting enforcement of creditors' rights and (ii) general principles of equity that restrict the availability of equitable remedies (regardless of whether enforceability is considered in a proceeding in equity or at law). Each of the Ancillary Agreements to which it is a party, upon their execution and delivery by the Buyer, will constitute the legal, valid and binding obligations of the Buyer enforceable against Buyer in accordance with its terms, except as limited by (i) applicable bankruptcy, insolvency, reorganization, moratorium or other laws of general application affecting enforcement of creditors' rights and (ii) general principles of equity that restrict the availability of equitable remedies (regardless of whether enforceability is considered in a proceeding in equity or at law).

        5.3    No Conflict or Violation.    

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        5.4    No Brokers.    Neither Buyer nor any of its Affiliates or Representatives has employed or made any agreement with any broker, finder or similar agent or any person or firm which will result in the obligation of Seller or any of its Affiliates to pay any finder's fee, brokerage fees or commission or similar payment in connection with the transactions contemplated hereby.

        5.5    SEC Filings.    

        5.6    Financial Resources.    Buyer has previously delivered to Seller debt and equity financing commitment letters for the transactions contemplated hereby (the "Commitment Letters"). Buyer obtained the Commitment Letters in the good faith belief that, subject to completion of customary due diligence investigation by the lenders, all of the terms or conditions applicable to Buyer in the Commitment Letter can be satisfied. Provided that Buyer is able to obtain the financing contemplated by the Commitment Letters, Buyer has as of the date hereof, and at the Closing will have, sufficient funds, including cash on hand together with funds available under bank or other credit facilities currently in place, to consummate the transactions contemplated by the Agreement and the Ancillary Agreements and to fulfill its obligations hereunder and thereunder, including without limitation, payment to Seller of the Purchase Price at the Closing and any adjustments to the Purchase Price following the Closing. Buyer is entering into this Agreement in good faith.

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ARTICLE VI

COVENANTS OF SELLER AND BUYER

        The Parent, BBI Biotech and Buyer each covenant with the other as follows:

        6.1    Further Assurances.    

        6.2    No Solicitation.    

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        6.3    Notification of Certain Matters.    From the date hereof through the Closing, Seller shall give prompt notice to Buyer of (a) the occurrence, or failure to occur, of any event which occurrence or failure would be reasonably likely to cause any representation or warranty contained in this Agreement or in any exhibit or schedule hereto to be untrue or inaccurate in any material respect and (b) any failure of the Parent, or BBI Biotech, or any of their respective affiliates, or of any of their respective Representatives, to comply with or satisfy any material covenant, condition or agreement to be complied with or satisfied by it under this Agreement or any exhibit or schedule hereto; provided, however, that such disclosure shall not be deemed to cure any breach of a representation, warranty, covenant or agreement or to satisfy any condition. Seller shall promptly notify Buyer of any Default, the threat or commencement of any Action, or any development that occurs before the Closing that could reasonably be anticipated to have a Material Adverse Effect on the Purchased Assets or the Business. Buyer shall promptly notify Seller if it shall become aware that any representation, warranty, covenant or agreement of Seller is or shall become untrue or inaccurate in any material respect from the date hereof until the Closing.

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        6.4    Investigation by Buyer.    

        From the date hereof through the Closing Date:

        6.5    Conduct of Business.    From the date hereof through the Closing, Seller shall, except as contemplated by this Agreement, or as consented to by Buyer in writing, operate the Business in the ordinary course of business and substantially in accordance with past practice and in substantial compliance with all applicable laws and regulations the failure to comply with which would not have a Material Adverse Effect, pay and cause its Subsidiaries to pay material debts and Taxes when due unless, solely with respect to Taxes, Seller is contesting such Taxes in good faith, to pay or perform other material obligations when due, and use its commercially reasonable efforts consistent with past practice to preserve intact the Business and the Purchased Assets, use its commercially reasonable efforts consistent with past practice to keep available the services of its and its Subsidiaries' present officers and key employees and use its commercially reasonable efforts consistent with past practice to preserve its and its Subsidiaries' relationships with customers, suppliers, distributors, licensors, licensees, and others having business dealings with it or its Subsidiaries, and Seller will not take any action inconsistent with this Agreement or with the consummation of the Closing. Without limiting the generality of the foregoing, Seller shall not, as it relates to the Business except as specifically contemplated by this Agreement or as consented to by Buyer in writing:

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        6.6    Employee Matters.    

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        6.7    Proxy Statement; Special Meeting.    

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        6.8    Financing.    Buyer shall use its commercially reasonable efforts to obtain the financing contemplated by the Commitment Letters, or if such financing is not available, replacement financing in an amount and on terms and conditions not materially less favorable than set forth in the Commitment Letters (such financing or any such replacement financing to be referred to herein at the "Financing"). Buyer shall provide Seller with such information as Seller may reasonably request to monitor Buyer's progress in obtaining the Financing.

        6.9    Notices.    Parent shall give all notices and other information required by applicable law to be given through the Closing Date (or after the Closing Date with respect to those employees of Seller who are not hired by Buyer after the Closing) to the employees of Seller, any collective bargaining unit representing any group of employees of Seller, and any applicable government authority as to the obligations of Seller under the WARN Act, the National Labor Relations Act, the Internal Revenue Code, COBRA, and other applicable law in connection with the transactions contemplated by this Agreement.

        6.10    Financial Reporting Cooperation.    After the Closing, Seller shall, and shall cause its Affiliates and Representatives to, cooperate with all reasonable requests in the preparation of all financial statements determined by Buyer to be necessary to meet its reporting obligations in connection with the consummation of the transactions contemplated by this Agreement. Seller shall provide, or cause to be provided to Buyer reasonable access to any records and other information in Seller's possession and control and requested by Buyer in connection therewith as well as access to, and the reasonable cooperation of, Seller's current and former accountants.

        6.11    Compliance with Bulk Sales Laws Requirements.    Buyer has agreed to waive compliance with all applicable bulk sale transfer laws in connection with the consummation of the transactions contemplated by this Agreement, including the bulk transfer provisions of the Uniform Commercial Code, and as a condition to such waiver by Buyer, Seller will indemnify, defend and hold harmless Buyer from any Damages as a result of non-compliance with such applicable bulk sale transfer laws.

        6.12    Seller's Covenant not to Compete.    

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        6.13    Retention Program.    Seller shall implement and fully fund a retention program on terms reasonably satisfactory to Buyer for the period from the date of this Agreement until the Closing.

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        6.14    Assumption of Mortgage.    Seller shall use its commercially reasonable efforts to obtain the consent of the mortgagee and lender of the Mortgage to permit the assumption of the Mortgage and related indebtedness by Buyer at the Closing.

        6.15    Frederick Lease.    Seller shall use its commercially reasonable efforts to obtain all consents and approvals necessary to be obtained for Seller (and after the Closing, Buyer) to occupy, and operate the Purchased Assets and the Business at, the property to be leased pursuant to the Frederick Lease. In the event that all such consents and approvals are not obtained prior to the Closing, Buyer may at its option (exercisable by it in its sole discretion) elect to include the Frederick Lease on the Schedule 1.1E(vi) list of excluded Contracts, in which case Buyer shall have no obligation to assume the Frederick Lease.

        6.16    Incomplete Contracts.    Certain of the Contracts referenced on the Disclosure Schedule are incomplete, either because they are missing one or more signatures or because they are missing one or more parts to the Contract. Each such Contract is denoted with an asterisk on the Disclosure Schedule (the "Incomplete Contracts"). Seller shall provide fully executed copies of each Incomplete Contract as soon as practicable. Notwithstanding anything in this Agreement to the contrary, Buyer may elect, in its sole discretion to assume (and accordingly treat as a Purchased Asset) or reject (and accordingly treat as an Excluded Asset) any Incomplete Contract unless (i) Seller provides Buyer with a complete, fully signed version (except for Contracts that are not material, and with respect to which it is not customary for one of the parties to sign) of the applicable Incomplete Contract, and (ii) such fully signed version does not differ in any material respect from the Incomplete Contract provided by Seller to Buyer prior to the date of this Agreement. Buyer's election to assume any Incomplete Contract shall in no way limit any of Buyer's rights under Section 10.4. Seller's obligations pursuant to this Section 6.16 shall terminate on the Closing Date.

ARTICLE VII

CONDITIONS TO SELLER'S OBLIGATIONS

        The obligations of Seller to consummate the transactions provided for hereby are subject, in the discretion of Seller, to the satisfaction, on or prior to the Closing Date, of each of the following conditions, any of which may be waived by Seller:

        7.1    Representations and Warranties.    The representations and warranties of the Buyer contained herein shall be true and accurate in all respects as of the date of this Agreement and as of the Closing Date as if made on the Closing Date except where the failure of such representations and warranties to be true and accurate (individually or in the aggregate) as of the Closing Date would not have a material adverse effect on the Buyer; and Parent shall have received at the Closing a certificate, signed by the president or chief financial officer of the Buyer to such effect. For purposes of determining whether a material adverse effect on the Buyer has occurred, all qualifications based on the word "material" contained in such representations and warranties shall be disregarded.

        7.2    Agreements and Covenants.    Buyer shall have performed or complied with, in all material respects, all agreements and covenants required by this Agreement to be performed or complied with by them on or prior to the Closing Date, and Parent shall have received at the Closing a certificate, signed by the president or chief financial officer of the Buyer to such effect.

        7.3    Consents; Regulatory Compliance and Approval.    Each of the consents set forth on Schedule 7.3 shall have been obtained.

        7.4    No Actions or Court Orders.    No action shall have been taken, and no statute, rule or regulation shall have been enacted, by any state or federal government, other governmental or regulatory agency or authority which would prevent the consummation of the transactions contemplated

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hereby. There shall not be any Regulation or Court Order that makes the purchase and sale of the Business or the Purchased Assets contemplated hereby illegal or otherwise prohibited.

        7.5    Opinion of Counsel.    Buyer shall have delivered to Seller an opinion of O'Melveny & Myers LLP, legal counsel to Buyer, dated as of the Closing Date, in substantially the form of Exhibit M.

        7.6    Corporate Documents.    Seller shall have received from Buyer resolutions adopted by the board of directors of Buyer approving this Agreement, the Ancillary Agreements and the transactions contemplated hereby or thereby, certified by Buyer's corporate secretary.

        7.7    Assumption Document.    Buyer shall have executed and delivered the Assumption Document.

        7.8    Ancillary Agreements.    Buyer shall have executed and delivered the Ancillary Agreements to which Buyer is a party.

        7.9    Stockholder Approval.    This Agreement and the transactions contemplated hereby shall have been approved by the holders of two-thirds of the outstanding shares of Parent and entitled to vote at the Special Meeting, in accordance with applicable law and Parent's Restated Articles of Organization, as amended, and the Amended and Restated Bylaws, as amended.

        7.10    401(k).    Prior to the Closing Date, the plan administrator of Buyer's Code Section 401(k) plan shall not have unreasonably withheld its approval of a rollover of assets (including, if applicable, any participant promissory notes) from the Seller's Code Section 401(k) plan related to the accounts of Rehired Employees should such Rehired Employees choose to rollover such assets. Seller shall provide the Buyer with copies of the Code Section 401(k) plan documents, Forms 5500 for the prior three (3) years, discrimination testing for prior three (3) years and a copy of the IRS determination letter.

        7.11    Mortgage.    As of the Closing, Buyer shall have paid off or assumed the Mortgage.

        7.12    Employees.    Buyer shall have offered employment to the Rehired Employees on terms consistent with Section 6.6 hereof.

ARTICLE VIII

CONDITIONS TO BUYER'S OBLIGATIONS

        The obligations of Buyer to consummate the transactions provided for hereby are subject, in the discretion of Buyer, to the satisfaction, on or prior to the Closing Date, of each of the following conditions, any of which may be waived by Buyer:

        8.1    Representations, Warranties and Covenants.    The representations and warranties of the Seller contained herein shall be true and accurate in all respects as of the date of this Agreement and as of the Closing Date as if made on the Closing Date except where the failure of such representations and warranties to be true and accurate (individually or in the aggregate) as of the Closing Date would not have a Material Adverse Effect; and Buyer shall have received at the Closing a certificate, signed by the president or chief financial officer of each of Parent and BBI Biotech to such effect. For purposes of determining whether a Material Adverse Effect has occurred (i) all qualifications based on the word "material" or "Material Adverse Effect" contained in such representations and warranties shall be disregarded and (ii) any disclosures made pursuant to Section 6.3 shall be disregarded.

        8.2    Agreements and Covenants.    Parent and BBI Biotech shall have performed or complied with, in all material respects, all agreements and covenants required by this Agreement to be performed or complied with by them on or prior to the Closing Date, and Buyer shall have received at the Closing a certificate, signed by the president or chief financial officer of each of Parent and BBI Biotech to such effect.

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        8.3    Consents; Regulatory Compliance and Approval.    Each of the consents set forth on Schedule 8.3 shall have been obtained.

        8.4    No Actions or Court Orders.    No action shall have been taken, and no statute, rule or regulation shall have been enacted, by any state or federal government, other governmental or regulatory agency or authority which would prevent the consummation of the transactions contemplated hereby. There shall not be any Regulation or Court Order that makes the purchase and sale of the Business or the Purchased Assets contemplated hereby illegal or otherwise prohibited.

        8.5    Opinion of Counsel.    Parent and BBI Biotech shall have delivered to Buyer an opinion of Brown Rudnick Berlack Israels LLP, legal counsel to the Parent and BBI Biotech, dated as of the Closing Date, in substantially the form of Exhibit N.

        8.6    Material Changes.    Since the Balance Sheet Date, there shall not have been any Material Adverse Change.

        8.7    Corporate Documents.    Buyer shall have received from Seller (i) resolutions adopted by the board of directors of Seller, approving this Agreement and the Ancillary Agreements and the transactions contemplated hereby and thereby, certified by Seller's corporate clerk; and (ii) a certificate of Parent's corporate clerk as to the vote adopted by the Parent's stockholders approving the Stockholder Approval Matters, and (iii) a unanimous written consent of BBI Biotech's shareholder, approving, to the extent required, the Agreement and the Ancillary Agreements and the transactions contemplated hereby and thereby.

        8.8    Conveyancing Documents; Release of Encumbrances.    Seller shall have executed and delivered each of documents described in Section 3.2 hereof so as to effect the transfer and assignment to Buyer of all right, title and interest in and to the Purchased Assets and Seller shall have filed (where necessary) and delivered to Buyer all documents necessary to release the Purchased Assets from all Encumbrances, which documents shall be in a form reasonably satisfactory to Buyer's counsel.

        8.9    Ancillary Agreements.    Parent, BBI Biotech, Mr. Richard Schumacher and the other parties (other than the Buyer) named therein, shall have executed and delivered the Ancillary Agreements in the forms attached as exhibits hereto.

        8.10    Financing.    Buyer shall have received the proceeds of the Financing.

        8.11    Stockholder Approval.    This Agreement and the transactions contemplated hereby shall have been approved by the holders of two-thirds of the outstanding shares of Parent and entitled to vote at the Special Meeting, in accordance with applicable law and Parent's Restated Articles of Organization, as amended, and the Amended and Restated Bylaws, as amended.

        8.12    Title Insurance.    Buyer shall have been able to obtain insurable title to the Owned Real Property at standard rates by a nationally recognized title insurance company, as evidenced by a commitment for title insurance issued to Buyer immediately prior to the Closing and committing to insure that Buyer will hold fee title to the Owned Real Property as of the Closing Date, subject only to the Permitted Encumbrances. Seller shall have provided a gap indemnity to the title insurance company insuring the title commitment as required for the issuance of the commitment.

        8.13    Know-How.    On or before the date that is two weeks prior to the Closing Date, Seller shall reduce all of Seller's standard operating procedures ("SOPs") to writing to the extent that such SOPs are not already in writing. Such writings shall sufficiently describe the SOPs so that Buyer could rely solely on such writings in the maintenance and operation of the Business as it was operated by Seller prior to the Closing Date. Seller agrees to provide such writings to Buyer on or before the date that is two weeks prior to the Closing Date.

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ARTICLE IX

CONSENTS TO ASSIGNMENT

        9.1    Consents to Assignment.    Anything in this Agreement to the contrary notwithstanding, this Agreement shall not constitute an agreement to assign any Contract, Assumed Lease, Permit or any claim or right or any benefit arising thereunder or resulting therefrom if an attempted assignment thereof, without the consent of a third party thereto, would constitute a Default thereof or in any material way adversely affect the rights of Buyer thereunder. If such consent is not obtained, or if an attempted assignment thereof would be ineffective or would adversely affect the rights thereunder so that Buyer would not receive all such rights, Seller will cooperate with Buyer, in all reasonable respects, to provide to Buyer the benefits under any such Contract, Assumed Lease, Permit or any claim or right, including without limitation enforcement for the benefit of Buyer of any and all rights of Seller against a third party thereto arising out of the Default or cancellation by such third party or otherwise.

ARTICLE X

ACTIONS BY SELLER AND BUYER
AFTER THE CLOSING

        10.1    Collection of Accounts Receivable and Letters of Credit.    At the Closing, Buyer will acquire hereunder, and thereafter Buyer or its designee shall have the right and authority to collect for Buyer's or its designee's account, all receivables, letters of credit and other items which constitute a part of the Purchased Assets, and Seller shall within five (5) days after receipt of any payment in respect of any of the foregoing, properly endorse and deliver to Buyer any letters of credit, documents, cash or checks received on account of or otherwise relating to any such receivables, letters of credit or other items. Seller shall promptly transfer or deliver to Buyer or its designee any cash or other property that Seller may receive in respect of any deposit, prepaid expense, claim, contract, license, lease, commitment, sales order, purchase order, letter of credit or receivable of any character, or any other item, constituting a part of the Purchased Assets.

        10.2    Books and Records; Tax Matters.    

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        10.3    Survival of Representations, Etc.    All of the representations and warranties made by each party in this Agreement shall survive the Closing for a period of (and claims based upon or arising out of such representations and warranties may be asserted at any time before the date which shall be) twenty one (21) months following the Closing, except that (i) the representations and warrants contained in Sections 4.1 [Organization of Seller], 4.2 [Subsidiaries], 4.3 [Authorization], 4.16 [No Brokers], 5.1 [Organization of Buyer], 5.2 [Authorization], and 5.5 [No Brokers] shall survive the Closing and remain in full force and effect indefinitely, (ii) the representations and warranties contained in Section 4.28 [Compliance with Environmental Laws] shall survive the Closing for a period of five years following the Closing, and (iii) the representations and warranties contained in Section 4.21 [Tax Matters] shall survive the Closing until the termination of the applicable statute of limitations (including all extensions or tolling of such statute by Seller). Each party hereto shall be entitled to rely upon the representations and warranties of the other party set forth in this Agreement. The termination of the representations and warranties provided herein shall not affect the rights of a party in respect of any Claim made by such party in a writing received by the other party prior to the expiration of the applicable survival period provided herein.

        10.4    Indemnifications.    

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ARTICLE XI

TERMINATION

        11.1    Termination.    This Agreement may be terminated at any time prior to the Closing, whether before or after the requisite approval of the stockholders of Parent:

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        11.2    Notice of Termination; Effect of Termination.    Any termination of this Agreement under Section 11.1 will be effective immediately upon (or if the termination is pursuant to Section 11.1(e) or 11.1(f) and the proviso therein is applicable, ten (10) days after) the delivery of written notice thereof by the terminating party to the other parties hereto. In the event of the termination of this Agreement as provided in Section 11.1, this Agreement shall be of no further force or effect, except (i) as set forth in this Section 11.2, Section 11.3 and Article XII (Miscellaneous), each of which shall survive the termination of this Agreement, and (ii) nothing herein shall relieve any party from liability for any intentional or willful breach of this Agreement.

        11.3    Fees and Expenses.    

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ARTICLE XII

MISCELLANEOUS

        12.1    Assignment.    Neither this Agreement nor any of the rights or obligations hereunder may be assigned by any party without the prior written consent of the other parties; except that Buyer may, without such consent, assign all such rights to any lender as collateral security or to a majority owned subsidiary so long as Buyer remains obligated to the full extent hereunder. Subject to the foregoing, this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns, and no other person shall have any right, benefit or obligation under this Agreement as a third party beneficiary or otherwise.

        12.2    Notices.    All notices, requests, demands and other communications which are required or may be given under this Agreement shall be in writing and shall be deemed to have been duly given when received if personally delivered; when transmitted if transmitted by telecopy, electronic or digital transmission method; the day after it is sent, if sent for next day delivery to a domestic address by

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recognized overnight delivery service (E.G., Federal Express); and upon receipt, if sent by certified or registered mail, return receipt requested. In each case notice shall be sent to:

        If to Parent or Seller, addressed to:

        With a copy to:

        If to Buyer, addressed to:

        With a copy to:

or to such other place and with such other copies as either party may designate as to itself by written notice to the others.

        12.3    Choice of Law.    This Agreement shall be construed, interpreted and the rights of the parties determined in accordance with the laws of the State of Delaware.

        12.4    Entire Agreement; Amendments and Waivers.    This Agreement, the Ancillary Agreements, together with all exhibits and schedules hereto and thereto (including the Disclosure Schedule) constitutes the entire agreement among the parties pertaining to the subject matter hereof and supersedes all prior agreements, understandings, negotiations and discussions, whether oral or written, of the parties, including, but not limited to (i) the Confidentiality Agreement and (ii) that certain letter of intent, dated January 30, 2004, between Buyer and Parent. This Agreement may not be amended except by an instrument in writing signed on behalf of each of the parties hereto. No amendment, supplement, modification or waiver of this Agreement shall be binding unless executed in writing by the party to be bound thereby. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provision hereof (whether or not similar), nor shall such waiver constitute a continuing waiver unless otherwise expressly provided.

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        12.5    Multiple Counterparts.    This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

        12.6    Expenses.    Except as otherwise specified in this Agreement, each party hereto shall pay its own legal, accounting, out-of-pocket and other expenses incident to this Agreement and to any action taken by such party in preparation for carrying this Agreement into effect.

        12.7    Invalidity.    In the event that any one or more of the provisions contained in this Agreement or in any other instrument referred to herein, shall, for any reason, be held to be invalid, illegal or unenforceable in any respect, then to the maximum extent permitted by law, such invalidity, illegality or unenforceability shall not affect any other provision of this Agreement or any other such instrument.

        12.8    Titles; Gender.    The titles, captions or headings of the Articles and Sections herein, and the use of a particular gender, are for convenience of reference only and are not intended to be a part of or to affect or restrict the meaning or interpretation of this Agreement.

        12.9    Publicity.    Parent and Buyer will consult with each other, and to the extent practicable, agree, before issuing any press release or otherwise making any public statement with respect to this Agreement or the transactions contemplated hereby, or an Acquisition Proposal and will not issue any such press release or make any such public statement prior to such consultation, except as otherwise advisable or as may be required by applicable law, rule or regulation, including but not limited to the rules of the Nasdaq, in which case reasonable efforts to consult with the other party will be made prior to such release or public statement. The parties have agreed to the text of the joint press release announcing the signing of this Agreement.

        12.10    Confidential Information.    

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        12.11    Cumulative Remedies.    All rights and remedies of either party hereto are cumulative of each other and of every other right or remedy such party may otherwise have at law or in equity, and the exercise of one or more rights or remedies shall not prejudice or impair the concurrent or subsequent exercise of other rights or remedies.

        12.12    Specific Performance.    The parties each acknowledge that, in view of the uniqueness of the Business, the Purchased Assets and the transactions contemplated by this Agreement and the Ancillary Agreements, each party would not have an adequate remedy at law for money damages in the event that this Agreement has not been performed in accordance with its terms, and therefore agrees that the other party shall be entitled to specific enforcement of the terms hereof in addition to any other remedy to which it may be entitled, at law or in equity.

        12.13    Arbitration.    All claims, disputes and other matters in question arising out of, or relating to, this Agreement or the performance hereof, including, without limitation, indemnifiable claims pursuant to Section 10.4, shall be submitted to, and determined by, arbitration if good faith negotiations among the parties hereto, if any, does not resolve such claim, dispute or other matter. Such arbitration shall proceed in accordance with the then-current rules for arbitration established by Judicial Arbitration Mediation Services, Inc./ENDISPUTE ("JAMS"), unless the parties hereto mutually agree otherwise, and pursuant to the following procedures:

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        IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed on their respective behalf, by their respective officers thereunto duly authorized, all as of the day and year first above written.

BOSTON BIOMEDICA, INC.    

By:
 
/s/  KEVIN W. QUINLAN      
Name: Kevin W. Quinlan
Its: President
 
 

BBI BIOTECH RESEARCH LABORATORIES, INC.
 
 

By:
 
/s/  KEVIN W. QUINLAN      
Name: Kevin W. Quinlan
Its: President
 
 

SERACARE LIFE SCIENCES, INC.
 
 

By:
 
/s/  MICHAEL F. CROWLEY II      
Name: Michael F. Crowley II
Its: CEO
 
 

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Appendix B

Board of Directors
Boston Biomedica, Inc.
375 West Street
West Bridgewater, MA 02379

Gentlemen:

        You have requested our opinion as to the fairness, from a financial point of view, to Boston Biomedica, Inc. ("Boston Biomedica", the "Company" or the "Seller"), of the Thirty Million Dollars ($30,000,000.00) in cash (the "Purchase Consideration") proposed to be paid to the Company pursuant to the Asset Purchase Agreement dated as of April 16, 2004 (the "Asset Purchase Agreement") by and among SeraCare Life Sciences, Inc. ("SeraCare" or the "Buyer") and the Company. Pursuant to the terms of and subject to the conditions set forth in the Asset Purchase Agreement, (i) the Company will sell, convey, transfer, assign and deliver to the Buyer, and the Buyer will acquire from the Seller, the business, properties, assets and rights used in connection with the Seller's business that is conducted by the business units currently known as "BBI Diagnostics" and "BBI Biotech," in each case as more specifically defined as the "Purchased Assets" in the Asset Purchase Agreement (collectively, the "Purchased Assets") and (ii) the Buyer will assume certain specified liabilities (the "Assumed Liabilities") from the Company as more specifically defined as "Assumed Liabilities" in the Asset Purchase Agreement (the "Transaction").

        In connection with our review of the proposed Transaction and the preparation of our opinion herein, we have examined: (a) the Asset Purchase Agreement; (b) certain audited historical financial statements of the Company for the three years ended December 31, 2003; (c) certain internal business, operating and financial information for the Purchased Assets and Assumed Liabilities and the Company for the fiscal years ended December 31, 2001, 2002 and 2003, (d) certain internal business, operating and financial information and forecasts of the Purchased Assets and Assumed Liabilities for fiscal years ending 2004, 2005, 2006, 2007 and 2008, prepared by the senior management of the Company (collectively, the "Forecasts"); (e) information regarding publicly available financial terms of certain other business combinations we deemed relevant; (f) the financial position and operating results of the Purchased Assets and Assumed Liabilities compared with those of certain other publicly traded companies we deemed relevant; (g) current and historical market prices and trading volumes of the common stock of the Company; and (h) certain other publicly available information on the Company. We have also held discussions with members of the senior management of the Company to discuss the foregoing, have considered other matters which we have deemed relevant to our inquiry and have taken into account such accepted financial and investment banking procedures and considerations as we have deemed relevant. In connection with our engagement, we were requested to approach, and held discussions with, third parties to solicit indications of interest in a possible acquisition of the Company.

        In rendering our opinion, we have assumed and relied, without independent verification, upon the accuracy and completeness of all the information examined by or otherwise reviewed or discussed with us for purposes of this opinion including without limitation the Forecasts provided by senior management. We have not made or obtained an independent valuation or appraisal of the Purchased Assets, Assumed Liabilities or any other assets or liabilities of the Company or solvency of the Company. We have been advised by the senior management of the Company that the Forecasts examined by us have been reasonably prepared on bases reflecting the best currently available estimates and judgments of the senior management of the Company, as the case may be. In that regard, we have assumed, with your consent, that (i) the Forecasts will be achieved in the amounts and at the times contemplated thereby and (ii) all material assets and liabilities (contingent or otherwise) comprising the

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Purchased Assets and Assumed Liabilities are as set forth in the Company's financial statements or other information made available to us. We express no opinion with respect to the Forecasts or the estimates and judgments on which they are based. Our opinion does not address the relative merits of the Transaction as compared to any alternative business strategies that might exist for the Company or the effect of any other transaction in which the Company might engage nor does it address the use of the Purchase Consideration by the Company following the consummation of the Transaction. Our opinion herein is based upon economic, market, financial and other conditions existing on, and other information disclosed to us as of, the date of this letter. It should be understood that, although subsequent developments may affect this opinion, we do not have any obligation to update, revise or reaffirm this opinion. We have relied as to all legal matters on advice of counsel to the Company, and have assumed that the Transaction will be consummated on the terms described in the Asset Purchase Agreement, without any waiver of any material terms or conditions by the Company.

        William Blair & Company has been engaged in the investment banking business since 1935. We continually undertake the valuation of investment securities in connection with public offerings, private placements, business combinations, estate and gift tax valuations and similar transactions. In the ordinary course of our business, we may from time to time trade the securities of the Company and SeraCare for our own account and for the accounts of customers, and accordingly may at any time hold a long or short position in such securities. We have acted as the investment banker to the Company in connection with the Transaction and will receive a fee from the Company for our services, a significant portion of which is contingent upon consummation of the Transaction. In addition, the Company has agreed to indemnify us against certain liabilities arising out of our engagement. Mr. Richard P. Kiphart, a Stockholder of the Company who owns 1,578,545 (or 23%) of the outstanding shares of common stock of the Company, is a principal of William Blair.

        We are expressing no opinion herein as to the price at which the common stock of the Company will trade at any future time or as to the effect of the Transaction on the trading price of the common stock of the Company. Such trading price may be affected by a number of factors, including but not limited to (i) dispositions of the common stock of the Company by stockholders within a short period of time after the effective date of the Transaction, (ii) changes in prevailing interest rates and other factors which generally influence the price of securities, (iii) adverse changes in the current capital markets, (iv) the occurrence of adverse changes in the financial condition, business, assets, results of operations or prospects of the Company, (v) any necessary actions by or restrictions of federal, state or other governmental agencies or regulatory authorities, and (vi) timely completion of the Transaction on terms and conditions that are acceptable to all parties at interest.

        Our investment banking services and our opinion were provided for the use and benefit of the Board of Directors of the Company in connection with its consideration of the transaction contemplated by the Asset Purchase Agreement. Our opinion is limited to the fairness, from a financial point of view, to the Company, in connection with the Transaction, and we do not address the merits of the underlying decision by the Company to engage in the Transaction and this opinion does not constitute a recommendation to any Stockholder as to how such Stockholder should vote with respect to the proposed Transaction. It is understood that this letter may not be disclosed or otherwise referred to without our prior written consent, except that the opinion may be included in its entirety in a proxy statement mailed to the Stockholders by the Company with respect to the Transaction and may be delivered to SeraCare in accordance with Section 4.31 of the Asset Purchase Agreement.

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        Based upon and subject to the foregoing, it is our opinion as investment bankers that, as of the date hereof, the Purchase Consideration to be received by the Company in the Transaction pursuant to the Asset Purchase Agreement is fair, from a financial point of view, to the Company.

    Very truly yours,

 
 
/s/  WILLIAM BLAIR & COMPANY, L.L.C.      
WILLIAM BLAIR & COMPANY, L.L.C.

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Appendix C


MASSACHUSETTS BUSINESS CORPORATION ACT
CHAPTER 156D
PART 13

        In this PART the following words shall have the following meanings unless the context requires otherwise:

        "Affiliate", any person that directly or indirectly through one or more intermediaries controls, is controlled by, or is under common control of or with another person.

        "Beneficial shareholder", the person who is a beneficial owner of shares held in a voting trust or by a nominee as the record shareholder.

        "Corporation", the issuer of the shares held by a shareholder demanding appraisal and, for matters covered in sections 13.22 to 13.31, inclusive, includes the surviving entity in a merger.

        "Fair value", with respect to shares being appraised, the value of the shares immediately before the effective date of the corporate action to which the shareholder demanding appraisal objects, excluding any element of value arising from the expectation or accomplishment of the proposed corporate action unless exclusion would be inequitable.

        "Interest", interest from the effective date of the corporate action until the date of payment, at the average rate currently paid by the corporation on its principal bank loans or, if none, at a rate that is fair and equitable under all the circumstances.

        "Marketable securities", securities held of record by, or by financial intermediaries or depositories on behalf of, at least 1,000 persons and which were

        (a)   listed on a national securities exchange,

        (b)   designated as a national market system security on an interdealer quotation system by the National Association of Securities Dealers, Inc., or

        (c)   listed on a regional securities exchange or traded in an interdealer quotation system or other trading system and had at least 250,000 outstanding shares, exclusive of shares held by officers, directors and affiliates, which have a market value of at least $5,000,000.

        "Officer", the chief executive officer, president, chief operating officer, chief financial officer, and any vice president in charge of a principal business unit or function of the issuer.

        "Person", any individual, corporation, partnership, unincorporated association or other entity.

        "Record shareholder", the person in whose name shares are registered in the records of a corporation or the beneficial owner of shares to the extent of the rights granted by a nominee certificate on file with a corporation.

        "Shareholder", the record shareholder or the beneficial shareholder.

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        (a)   A shareholder is entitled to appraisal rights, and obtain payment of the fair value of his shares in the event of, any of the following corporate for other actions:

        (1)   consummation of a plan of merger to which the corporation is a party if shareholder approval is required for the merger by section 11.04 or the articles of organization or if the corporation is a subsidiary that is merged with its parent under section 11.05, unless, in either case, (A) all shareholders are to receive only cash for their shares in amounts equal to what they would.receive upon a dissolution of the corporation or, in the case of shareholders already holding marketable securities in the merging corporation, only marketable securities of the surviving corporation and/or cash and (B) no director, officer or controlling shareholder has a direct or indirect material financial interest in the merger other than in his capacity as (i) a shareholder of the corporation, (ii) a director, officer, employee or consultant of either the merging or the surviving corporation or of any affiliate of the surviving corporation if his financial interest is pursuant to bona fide arrangements with either corporation or any such affiliate, or (iii) in any other capacity so long as the shareholder owns not more than five percent of the voting shares of all classes and series of the corporation in the aggregate;

        (2)   consummation of a plan of share exchange in which his shares are included unless: (A) both his existing shares and the shares, obligations or other securities to be acquired are marketable securities; and (B) no director, officer or controlling shareholder has a direct or indirect material financial interest in the share exchange other than in his capacity as (i) a shareholder of the corporation whose shares are to be exchanged, (ii) a director, officer, employee or consultant of either the corporation whose shares are to be exchanged or the acquiring corporation or of any affiliate of the acquiring corporation if his financial interest is pursuant to bona fide arrangements with either corporation or any such affiliate, or (iii) in any other capacity so long as the shareholder owns not more than five percent of the voting shares of all classes and series of the corporation whose shares are to be exchanged in the aggregate;

        (3)   consummation of a sale or exchange of all, or substantially all, of the property of the corporation if the sale or exchange is subject to section 12.02, or a sale or exchange of all, or substantially all, of the property of a corporation in dissolution, unless:

          (i)  his shares are then redeemable by the corporation at a price not (greater than the cash to be received in exchange for his shares; or

         (ii)  the sale or exchange is pursuant to court order; or

        (iii)  in the case of a sale or exchange of all or substantially all the property of the corporation subject to section 12.02, approval of shareholders for the sale or exchange is conditioned upon the dissolution of the corporation and the distribution in cash or, if his shares are marketable securities, in marketable securities and/or cash, of substantially all of its net assets, in excess of a reasonable amount reserved to meet unknown claims under section 14.07, to the shareholders in accordance with their respective interests within one year after the sale or exchange and no director, officer or controlling shareholder has a direct or indirect material financial interest in the sale or exchange other than in his capacity as (i) a shareholder of the corporation, (ii) a director, officer, employee or consultant of either the corporation or the acquiring corporation or of any affiliate of the acquiring corporation if his financial interest is pursuant to bona fide arrangements with either corporation or any such affiliate, or (iii) in any other capacity so long as the shareholder owns not more than five percent of the voting shares of all classes and series of the corporation in the aggregate;

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        (4)   an amendment of the articles of organization that materially and adversely affects rights in respect of a shareholders shares because it:

          (i)  creates, alters or abolishes the stated rights or preferences of the shares with respect to distributions or to dissolution, including making non-cumulative in whole or in part a dividend theretofore stated as cumulative;

         (ii)  creates, alters or abolishes a stated right in respect of conversion or redemption, including any provision relating to any sinking fund or purchase, of the shares;

        (iii)  alters or abolishes a preemptive right of the holder of the shares to acquire shares or other securities;

        (iv)  excludes or limits the right of the holder of the shares to vote on any matter, or to cumulate votes, except as such right may be limited by voting rights given to new shares then being authorized of an existing or new class; or

         (v)  reduces the number of shares owned by the shareholder to a fraction of a share if the fractional share so created is to be acquired for cash under section 6.04;

        (5)   an amendment of the articles of organization or of the bylaws or the entering into by the corporation of any agreement to which the shareholder is not a party that adds restrictions on the transfer or registration or any outstanding shares held by the shareholder or amends any pre-existing restrictions on the transfer or registration of his shares in a manner which is materially adverse to the ability of the shareholder to transfer his shares;

        (6)   any corporate action taken pursuant to a shareholder vote to the extent the articles of organization, bylaws or a resolution of the board of directors provides that voting or nonvoting shareholders are entitled to appraisal;

        (7)   consummation of a conversion of the corporation to nonprofit status pursuant to subdivision B of PART 9; or

        (8)   consummation of a conversion of the corporation into a form of other entity pursuant to subdivision D of PART 9.

        (b)   Except as otherwise provided in subsection (a) of section 13.03, in the event of corporate action specified in clauses (1), (2), (3), (7) or (8) of subsection (a), a shareholder may assert appraisal rights only if he seeks them with respect to all of his shares of whatever class or series.

        (c)   Except as otherwise provided in subsection (a) of section 13.03, in the event of an amendment to the articles of organization specified in clause (4) of subsection (a) or in the event of an amendment of the articles of organization or the bylaws or an agreements to which the shareholder is not a party specified in clause (5) of subsection (a), a shareholder may assert appraisal rights with respect to those shares adversely affected by the amendment or agreement only if he seeks them as to all of such shares and, in the case of an amendment to the articles of organization or the bylaws, has not voted any of his shares of any class or series in favor of the proposed amendment.

        (d)   The shareholder's right to obtain payment of the fair value of his shares shall terminate upon the occurrence of any of the following events:

          (i)  the proposed action is abandoned or rescinded; or

         (ii)  a court having jurisdiction permanently enjoins or sets aside the action; or

        (iii)  the shareholder's demand for payment is withdrawn with the written consent of the corporation.

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        (e)   A shareholder entitled to appraisal rights under this chapter may not challenge the action creating his entitlement unless the action is unlawful or fraudulent with respect to the shareholder or the corporation.

        (a)   A record shareholder may assert appraisal rights as to fewer than all the shares registered in the record shareholder's name but owned by a beneficial shareholder only if the record shareholder objects with respect to all shares of the class or series owned by the beneficial shareholder and notifies the corporation in writing of the name and address of each beneficial shareholder on whose behalf appraisal rights are being asserted. The rights of a record shareholder who asserts appraisal rights for only part of the shares held of record in the record shareholder's name under this subsection shall be determined as if the shares as to which the record shareholder objects and the record shareholder's other shares were registered in the names of different record shareholders.

        (b)   A beneficial shareholder may assert appraisal rights as to shares of any class or series held on behalf of the shareholder only if such shareholder:

        (1)   submits to the corporation the record shareholder's written consent to the assertion of such rights no later than the date referred to in subclause (ii) of clause (2) of subsection (b) of section 13.22; and

        (2)   does so with respect to all shares of the class or series that are beneficially owned by the beneficial shareholder.

        (a)   If proposed corporate action described in subsection (a) of section 13.02 is to be submitted to a vote at a shareholders' meeting or through the solicitation of written consents, the meeting notice or solicitation of consents shall state that the corporation has concluded that shareholders are, are not or may be entitled to assert appraisal rights under this chapter and refer to the necessity of the shareholder delivering, before the vote is taken, written notice of his intent to demand payment and to the requirement that he not vote his shares in favor of the proposed action. If the corporation concludes that appraisal rights are or may be available, a copy of this chapter shall accompany the meeting notice sent to those record shareholders entitled to exercise appraisal rights.

        (b)   In a merger pursuant to section 11.05, the parent corporation shall notify in writing all record shareholders of the subsidiary who are entitled to assert appraisal rights that the corporate action became effective. Such notice shall be sent within 10 days after the corporate action became effective and include the materials described in section 13.22.

        (a)   If proposed corporate action requiring appraisal rights under section 13.02 is submitted to vote at a shareholders' meeting, a shareholder who wishes to assert appraisal rights with respect to any class or series of shares:

        (1)   shall deliver to the corporation before the vote is taken written notice of the shareholder's intent to demand payment if the proposed action is effectuated; and

        (2)   shall not vote, or cause or permit to be voted, any shares of such class or series in favor of the proposed action.

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        (b)   A shareholder who does not satisfy the requirements of subsection (a) is not entitled to payment under this chapter.

        (a)   If proposed corporate action requiring appraisal rights under subsection (a) of section 13.02 becomes effective, the corporation shall deliver a written appraisal notice and form required by clause (1) of subsection (b) to all shareholders who satisfied the requirements of section 13.21 or, if the action was taken by written consent, did not consent. In the case of a merger under section 11.05, the parent shall deliver a written appraisal notice and form to all record shareholders who may be entitled to assert appraisal rights.

        (b)   The appraisal notice shall be sent no earlier than the date the corporate action became effective and no later than 10 days after such date and must:

        (1)   supply a form that specifies the date of the first announcement to shareholders of the principal terms of the proposed corporate action and requires the shareholder asserting appraisal rights to certify (A) whether or not beneficial ownership of those shares for which appraisal rights are asserted was acquired before that date and (B) that the shareholder did not vote for the transaction;

        (2)   state:

          (i)  where the form shall be sent and where certificates for certificated shares shall be deposited and the date by which those certificates shall be deposited, which date may not be earlier than the date for receiving the required form under subclause (ii);

         (ii)  a date by which the corporation shall receive the form which date may not be fewer than 40 nor more than 60 days after the date the subsection (a) appraisal notice and form are sent, and state that the shareholder shall have waived the right to demand appraisal with respect to the shares unless the form is received by the corporation by such specified date;

        (iii)  the corporation's estimate of the fair value of the shares;

        (iv)  that, if requested in writing, the corporation will provide, to the shareholder so requesting, within 10 days after the date specified in clause (ii) the number of shareholders who return the forms by the specified date and the total number of shares owned by them; and

         (v)  the date by which the notice to withdraw under section 13.23 shall be received, which date shall be within 20 days after the date specified in subclause (ii) of this subsection; and

        (3)   be accompanied by a copy of this chapter.

        (a)   A shareholder who receives notice pursuant to section 13.22 and who wishes to exercise appraisal rights shall certify on the form sent by the corporation whether the beneficial owner of the shares acquired beneficial ownership of the shares before the date required to be set forth in the notice pursuant to clause (1) of subsection (b) of section 13.22. If a shareholder fails to make this certification, the corporation may elect to treat the shareholder's shares as after acquired shares under section 13.25. In addition, a shareholder who wishes to exercise appraisal rights shall execute and return the form and, in the case of certificated shares, deposit the shareholder's certificates in accordance with the terms of the notice by the date referred to in the notice pursuant to subclause (ii) of clause (2) of subsection (b) of section 13.22. Once a shareholder deposits that shareholder's certificates or, in the case of uncertificated shares, returns the executed forms, that shareholder loses all rights as a shareholder, unless the shareholder withdraws pursuant to said subsection (b).

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        (b)   A shareholder who has complied with subsection (a) may nevertheless decline to exercise appraisal rights and withdraw from the appraisal process by so notifying the corporation in writing by the date set forth in the appraisal notice pursuant to subclause (v) of clause (2) of subsection (b) of section 13.22. A shareholder who fails to so withdraw from the appraisal process may not thereafter withdraw without the corporation's written consent.

        (c)   A shareholder who does not execute and return the form and, in the case of certificated shares, deposit that shareholder's share certificates where required, each by the date set forth in the notice described in subsection (b) of section 13.22, shall not be entitled to payment under this chapter.

        (a)   Except as provided in section 13.25, within 30 days after the form required by subclause (ii) of clause (2) of subsection (b) of section 13.22 is due, the corporation shall pay in cash to those shareholders who complied with subsection (a) of section 13.23 the amount the corporation estimates to be the fair value of their shares, plus interest.

        (b)   The payment to each shareholder pursuant to subsection (a) shall be accompanied by:

        (1)   financial statements of the corporation that issued the shares to be appraised, consisting of a balance sheet as of the end of a fiscal year ending not more than 16 months before the date of payment, an income statement for that year, a statement of changes in shareholders' equity for that year, and the latest available interim financial statements, if any;

        (2)   a statement of the corporation's estimate of the fair value of the shares, which estimate shall equal or exceed the corporation's estimate given pursuant to subclause (iii) of clause (2) of subsection (b) of section 13.22; and

        (3)   a statement that shareholders described in subsection (a) have the right to demand further payment under section 13.26 and that if any such shareholder does not do so within the time period specified therein, such shareholder shall be deemed to have accepted the payment in full satisfaction of the corporation's obligations under this chapter.

        (a)   A corporation may elect to withhold payment required by section 13.24 from any shareholder who did not certify that beneficial ownership of all of the shareholder's shares for which appraisal rights are asserted was acquired before the date set forth in the appraisal notice sent pursuant to clause (1) of subsection (b) of section 13.22.

        (b)   If the corporation elected to withhold payment under subsection (a), it must, within 30 days after the form required by subclause (ii) of clause (2) of subsection (b) of section 13.22 is due, notify all shareholders who are described in subsection (a):

        (1)   of the information required by clause (1) of subsection (b) of section 13.24;

        (2)   of the corporation's estimate of fair value pursuant to clause (2) of subsection (b) of said section 13.24;

        (3)   that they may accept the corporation's estimate of fair value, plus interest, in full satisfaction of their demands or demand appraisal under section 13.26;

        (4)   that those shareholders who wish to accept the offer shall so notify the corporation of their acceptance of the corporation's offer within 30 days after receiving the offer; and

        (5)   that those shareholders who do not satisfy the requirements for demanding appraisal under section 13.26 shall be deemed to have accepted the corporation's offer.

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        (c)   Within 10 days after receiving the shareholder's acceptance pursuant to subsection (b), the corporation shall pay in cash the amount it offered under clause (2) of subsection (b) to each shareholder who agreed to accept the corporation's offer in full satisfaction of the shareholder's demand.

        (d)   Within 40 days after sending the notice described in subsection (b), the corporation must pay in cash the amount if offered to pay under clause (2) of subsection (b) to each shareholder deserved in clause (5) of subsection (b).

        Section 13.26.    PROCEDURE IF SHAREHOLDER DISSATISFIED WITH PAYMENT OR OFFER

        (a)   A shareholder paid pursuant to section 13.24 who is dissatisfied with the amount of the payment shall notify the corporation in writing of that shareholder's estimate of the fair value of the shares and demand payment of that estimate plus interest, less any payment under section 13.24. A shareholder offered payment under section 13.25 who is dissatisfied with that offer shall reject the offer and demand payment of the shareholder's stated estimate of the fair value of the shares plus interest.

        (b)   A shareholder who fails to notify the corporation in writing of that shareholder's demand to be paid the shareholder's stated estimate of the fair value plus interest under subsection (a) within 30 days after receiving the corporation's payment or offer of payment under section 13.24 or section 13.25, respectively, waives the right to demand payment under this section and shall be entitled only to the payment made or offered pursuant to those respective sections.

        (a)   If a shareholder makes demand for payment under section 13.26 which remains unsettled, the corporation shall commence an equitable proceeding within 60 days after receiving the payment demand and petition the court to determine the fair value of the shares and accrued interest. If the corporation does not commence the proceeding within the 60-day period, it shall pay in cash to each shareholder the amount the shareholder demanded pursuant to section 13.26 plus interest.

        (b)   The corporation shall commence the proceeding in the appropriate court of the county where the corporation's principal office, or, if none, its registered office, in the commonwealth is located. If the corporation is a foreign corporation without a registered office in the commonwealth, it shall commence the proceeding in the county in the commonwealth where the principal office or registered office of the domestic corporation merged with the foreign corporation was located at the time of the transaction.

        (c)   The corporation shall make all shareholders, whether or not residents of the commonwealth, whose demands remain unsettled parties to the proceeding as an action against their shares, and all parties shall be served with a copy of the petition. Nonresidents may be served by registered or certified mail or by publication as provided by law or otherwise as ordered by the court.

        (d)   The jurisdiction of the court in which the proceeding is commenced under subsection (b) is plenary and exclusive. The court may appoint 1 or more persons as appraisers to receive evidence and recommend a decision on the question of fair value. The appraisers shall have the powers described in the order appointing them, or in any amendment to it. The shareholders demanding appraisal rights are entitled to the same discovery rights as parties in other civil proceedings.

        (e)   Each shareholder made a party to the proceeding is entitled to judgment (i) for the amount, if any, by which the court finds the fair value of the shareholder's shares, plus interest, exceeds the

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amount paid by the corporation to the shareholder for such shares or (ii) for the fair value, plus interest, of the shareholder's shares for which the corporation elected to withhold payment under section 13.25.

        (a)   The court in an appraisal proceeding commenced under section 13.30 shall determine all costs of the proceeding, including the reasonable compensation and expenses of appraisers appointed by the court. The court shall assess the costs against the corporation, except that the court may assess cost against all or some of the shareholders demanding appraisal, in amounts the court finds equitable, to the extent the court finds such shareholders acted arbitrarily, vexatiously, or not in good faith with respect to the rights provided by this chapter.

        (b)   The court in an appraisal proceeding may also assess the fees and expenses of counsel and experts for the respective parties, in amounts the court finds equitable:

        (1)   against the corporation and in favor of any or all shareholders demanding appraisal if the court finds the corporation did not substantially comply with the requirements of sections 13.20, 13.22, 13.24 or 13.25; or

        (2)   against either the corporation or a shareholder demanding appraisal, in favor of any other party, if the court finds that the party against whom the fees and expenses are assessed acted arbitrarily, vexatiously, or not in good faith with respect to the rights provided by this chapter.

        (c)   If the court in an appraisal proceeding finds that the services of counsel for any shareholder were of substantial benefit to other shareholders similarly situated, and that the fees for those services should not be assessed against the corporation, the court may award to such counsel reasonable fees to be paid out of the amounts awarded the shareholders who were benefited.

        (d)   To the extent the corporation fails to make a required payment pursuant to sections 13.24, 13.25, or 13.26, the shareholder may sue directly for the amount owed and, to the extent successful, shall be entitled to recover from the corporation all costs and expenses of the suit, including counsel fees.

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Appendix D


VOTING AGREEMENT

        This Voting Agreement (this "Agreement") is made and entered into as of April 16, 2004, by and between the stockholder identified on the signature page hereto (the "Stockholder") and SeraCare Life Sciences, Inc., a California corporation ("Buyer").


RECITALS

        WHEREAS, Buyer and Boston Biomedica Inc., a Massachusetts corporation ("Parent") are parties to that certain Asset Purchase Agreement dated as of April 16, 2004 (the "Purchase Agreement") by and among Buyer, Parent and BBI Biotech Research Laboratories, Inc., a Massachusetts corporation. In order to induce Buyer to enter into the Purchase Agreement, the Stockholder has entered into this Agreement with Buyer. The Stockholder is the beneficial owner (as defined in Rule 13d-3 under the Securities Exchange Act of 1934, as amended (the "Exchange Act")) of such number of shares of the outstanding Common Stock, $0.01 par value per share, of Parent as is indicated on the final page of this Agreement (the "Shares").


AGREEMENT

        NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows:

        1.    Agreement to Retain Shares.    

D-1

        4.    No Solicitation.    

D-2

The Stockholder agrees that any violation of the restrictions set forth in this Section 4 by any Stockholder Representative or any affiliate of the Stockholder or any Stockholder Representative, whether or not such Person is purporting to act on behalf of the Stockholder, shall constitute a breach by the Stockholder of this Section 4.

        5.    Representations, Warranties and Covenants of the Stockholder.    The Stockholder hereby represents, warrants and covenants to Buyer that (i) the Stockholder is the beneficial owner of the Shares, which at the date of this Agreement and at all times up until the Expiration Date will be free and clear of any liens, claims, options, charges or other encumbrances (except pursuant to marital property laws) that would interfere with the voting of the Shares in accordance with this Agreement or the granting of any proxy with respect thereto; (ii) the Stockholder does not beneficially own any shares of capital stock of Parent other than the Shares; (iii) the Stockholder has full power and authority to make, enter into and carry out the terms of this Agreement and the Proxy; and (iv) the execution and

D-3

delivery of this Agreement by the Stockholder and the consummation by the Stockholder of the transactions contemplated hereby have been duly authorized by all necessary action, if any, on the part of the Stockholder. With respect to the representations and warranties in clause (i) of this Section 5, Buyer acknowledges that the Shares have been pledged by the Stockholder to Commerce Bank pursuant to the Commerce Bank Pledge and to Parent pursuant to the Parent Pledge. Each of Commerce Bank and Parent have confirmed to Buyer by the letters referenced in Section 1 of this Agreement that neither pledgee will take any actions under their respective pledge to limit, stop or otherwise interfere with Buyer's right to vote the Shares hereunder.

        6.    Additional Documents.    The Stockholder hereby covenants and agrees to execute and deliver any additional documents necessary or desirable to carry out the purpose and intent of this Agreement.

        7.    Consent and Waiver.    The Stockholder hereby gives any consents or waivers that are reasonably required for the consummation of the Purchase Agreement under the terms of any agreement to which the Stockholder is a party or pursuant to any rights the Stockholder may have.

        8.    Termination.    This Agreement and the Proxy delivered in connection herewith shall terminate and shall have no further force or effect as of the Expiration Date; provided, however, that no such termination of this Agreement or the Proxy shall relieve the Stockholder from any liability for any breach of this Agreement or the Proxy prior to their respective termination.

        9.    Miscellaneous.    

D-4

        If to the Stockholder, to the address set forth on the signature page hereto.

or to such other place and with such other copies as either party may designate as to itself by written notice to the others.

[Remainder of page intentionally left blank]

D-5

        IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed as of the date first above written.

    SERACARE LIFE SCIENCES, INC.,
a California corporation

 
 
By:
/s/  MICHAEL F. CROWLEY II      
Name: Michael F. Crowley
Title: CEO

 
 
Address: 1935 Avenida del Oro, Suite F
                  Oceanside, CA 92056
                  Attention: President
                  Facsimile No.: (760) 806-8933

 
 
STOCKHOLDER

 
 
By:
/s/  RICHARD T. SCHUMACHER      
Name: Richard T. Schumacher

 
 
Address: 65 Black Pond Lane
                  Taunton, MA 02780
                  Facsimile No.: (508) 828-6773

 
 
Shares beneficially owned:
 
   Class of Shares
   Number
    Common Stock   707,047*
*
Includes options to purchase an aggregate of 48,667 shares of Common Stock as well as 20,473 shares of Common Stock held of record by Mr. Schumacher's spouse.

S-1


SCHEDULE 1

IRREVOCABLE PROXY TO VOTE STOCK OF PARENT

        The undersigned stockholder of Boston Biomedica, Inc., a Massachusetts corporation ("Parent"), hereby irrevocably appoints the Chief Executive Officer and Chief Financial Officer from time to time (currently Michael Crowley, Jr. and Tim Hart, respectively) of SeraCare Life Sciences, Inc., a California corporation ("Buyer"), and each of them, as the sole and exclusive attorneys and proxies of the undersigned, with full power of substitution and resubstitution, to vote and exercise all voting and related rights (to the full extent that the undersigned is entitled to do so) with respect to all of the shares of capital stock of Parent that now are or hereafter may be beneficially owned by the undersigned, and any and all other shares or securities of Parent issued or issuable in respect thereof on or after the date hereof (collectively, the "Shares") in accordance with the terms of this Proxy. The Shares beneficially owned by the undersigned stockholder of Parent as of the date of this Proxy are listed on the final page of this Proxy. Upon the undersigned's execution of this Proxy, any and all prior proxies given by the undersigned with respect to any Shares are hereby revoked and the undersigned agrees not to grant any subsequent proxies with respect to the Shares and this subject matter until after the Expiration Date (as defined below).

        This Proxy is irrevocable, is granted pursuant to that certain Voting Agreement of even date herewith, by and between Buyer and the undersigned stockholder (the "Voting Agreement"), and is granted in consideration of Buyer entering into that certain Asset Purchase Agreement, of even date herewith, by and among Parent, Buyer and BBI Biotech Research Laboratories, Inc., a Massachusetts corporation (the "Purchase Agreement"). This Proxy shall terminate on the Expiration Date (as such term is defined in the Voting Agreement).

        The attorneys and proxies named above, and each of them, are hereby authorized and empowered by the undersigned, at any time prior to the Expiration Date, to act as the undersigned's attorney and proxy to vote the Shares, and to exercise all voting and other rights of the undersigned with respect to the Shares (including, without limitation, the power to execute and deliver written consents pursuant to Section 43 of Chapter 156B of the Annotated Laws of Massachusetts, or such successor provision of the law contained in Chapter 156D of the Massachusetts Business Corporation Act, which becomes effective on July 1, 2004), at every annual, special or adjourned meeting of the stockholders of Parent and in every written consent in lieu of such meeting (i) in favor of approval of the Purchase Agreement and in favor of any matter necessary to facilitate the Purchase Agreement, and (ii) against any Acquisition Proposal (as such term is defined in the Purchase Agreement), or any other action or agreement that would result in a breach of any covenant, representation or warranty or any other obligation or agreement of Parent under the Purchase Agreement or which could reasonably be expected to result in any of the conditions to Parent's obligations under the Purchase Agreement not being fulfilled; provided, however, that the undersigned shall not be required to vote the Shares and any New Shares in favor of approval of the matters identified in clause (i) or against the matters identified in clause (ii) of this paragraph if (A) a Superior Offer (as such term is defined in the Purchase Agreement) is made after the date of this Agreement, and (B) in response to such Superior Offer the Board of Directors of Parent withholds, withdraws, amends or modifies its recommendation in favor of the Stockholder Approval Matters (as such term is defined in the Purchase Agreement) in a manner materially adverse to Buyer because the Board of Directors of Parent has reasonably concluded in good faith, after consultation with its outside counsel, that the failure to withhold, withdraw, amend or modify such recommendation would violate its fiduciary obligations under applicable law. The attorneys and proxies named above may not exercise this Proxy on any other matter except as provided above. The undersigned stockholder may vote the Shares on all other matters.

Schedule 1-1

        Any obligation of the undersigned hereunder shall be binding upon the successors and assigns of the undersigned.

[Remainder of page intentionally left blank]

Schedule 1-2

        IN WITNESS WHEREOF, the undersigned has caused this Proxy to be executed as of the date set forth below.


Dated: April 16, 2004
 
By:
/s/  RICHARD T. SCHUMACHER      
RICHARD T. SCHUMACHER

 
 
Shares beneficially owned:
 
   Class of Shares
   Number
    Common Stock   707,047*
*
Includes options to purchase an aggregate of 48,667 shares of Common Stock as well as 20,473 shares of Common Stock held of record by Mr. Schumacher's spouse.

Schedule 1-3

Appendix E


VOTING AGREEMENT

        This Voting Agreement (this "Agreement") is made and entered into as of April 16, 2004, by and between the stockholders set forth on the signature pages hereto (each a "Stockholder" and collectively, the "Stockholders") and SeraCare Life Sciences, Inc., a California corporation ("Buyer").


RECITALS

        WHEREAS, Buyer and Boston Biomedica, Inc., a Massachusetts corporation ("Parent") are parties to that certain Asset Purchase Agreement dated as of April 16, 2004 (the "Purchase Agreement") by and among Buyer, Parent and BBI Biotech Research Laboratories, Inc., a Massachusetts corporation. In order to induce Buyer to enter into the Purchase Agreement, the Stockholders have entered into this Agreement with Buyer. Each Stockholder is the beneficial owner (as defined in Rule 13d-3 under the Securities Exchange Act of 1934, as amended (the "Exchange Act")) of such number of shares of the outstanding Common Stock, $0.01 par value per share, of Parent as is indicated on the final page of this Agreement (the "Shares").


AGREEMENT

        NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows:

        1.    Agreement to Retain Shares.    

        2.    Agreement to Vote Shares.    Prior to the Expiration Date, at every meeting of the stockholders of Parent called with respect to any of the following, and at every adjournment thereof, and on every action or approval by written consent of the stockholders of Parent with respect to any of the following, each Stockholder shall vote the Shares and any New Shares (to the extent such New Shares have voting rights) (i) in favor of approval of the Purchase Agreement and any matter necessary to facilitate the consummation of the Purchase Agreement and all transactions contemplated thereby, and (ii) against any Acquisition Proposal (as such term is defined in the Purchase Agreement), or any other action or agreement that would result in a breach of any covenant, representation or warranty or any other

E-1

obligation or agreement of Parent under the Purchase Agreement or which could reasonably be expected to result in any of the conditions to Parent's obligations under the Purchase Agreement not being fulfilled; provided, however, that such Stockholder shall not be required to vote the Shares and any New Shares in favor of approval of the matters identified in clause (i) or against the matters identified in clause (ii) of this Section 2 if (A) a Superior Offer (as such term is defined in the Purchase Agreement) is made after the date of this Agreement, and (B) in response to such Superior Offer the Board of Directors of Parent withholds, withdraws, amends or modifies its recommendation in favor of the Stockholder Approval Matters (as such term is defined in the Purchase Agreement) in a manner materially adverse to Buyer because the Board of Directors of Parent has reasonably concluded in good faith, after consultation with its outside counsel, that the failure to withhold, withdraw, amend or modify such recommendation would violate its fiduciary obligations under applicable law.

        3.    Irrevocable Proxy; Power of Attorney.    Without limiting the generality of the foregoing, each Stockholder hereby irrevocably constitutes and appoints Buyer or its designee as its attorney and proxy, with full power of substitution and re-substitution to vote such Stockholder's Shares and any New Shares (to the extent such New Shares have voting rights) for and in the name, place and stead of such Stockholder at any meeting and at any adjournment thereof, or pursuant to any written consent of stockholders of Parent, in accordance with the agreements set forth in Section 2 hereof. Subject to the provisions of Section 8 below, this proxy and power of attorney is irrevocable (at all times prior to the Expiration Date) and coupled with an interest. Each Stockholder hereby revokes all other proxies and power of attorney with respect to the Shares and/or any New Shares that it may have heretofore appointed or granted, and no subsequent proxy or power of attorney shall be granted (and if granted, shall not be effective) by such Stockholder with respect thereto. Concurrently with the execution of this Agreement, each Stockholder agrees to deliver to Buyer a proxy (the form of which is attached hereto as Schedule 1, the "Proxy"), covering the total number of Shares and New Shares beneficially owned or as to which beneficial ownership is acquired (as such term is defined in Rule 13d-3 under the Exchange Act) by such Stockholder.

        4.    No Solicitation.    

E-2

        5.    Representations, Warranties and Covenants of the Stockholder.    Each Stockholder hereby represents, warrants and covenants to Buyer that (i) such Stockholder is the beneficial owner of the Shares, which at the date of this Agreement and at all times up until the Expiration Date will be free and clear of any liens, claims, options, charges or other encumbrances (except pursuant to marital property laws) that would interfere with the voting of the Shares in accordance with this Agreement or the granting of any proxy with respect thereto; (ii) such Stockholder does not beneficially own any shares of capital stock of Parent other than the Shares; (iii) such Stockholder has full power and authority to make, enter into and carry out the terms of this Agreement and the Proxy; and (iv) the execution and delivery of this Agreement by such Stockholder and the consummation by such Stockholder of the transactions contemplated hereby have been duly authorized by all necessary action, if any, on the part of such Stockholder.

        6.    Additional Documents.    Each Stockholder hereby covenants and agrees to execute and deliver any additional documents necessary or desirable to carry out the purpose and intent of this Agreement.

        7.    Consent and Waiver.    Each Stockholder hereby gives any consents or waivers that are reasonably required for the consummation of the Purchase Agreement under the terms of any agreement to which such Stockholder is a party or pursuant to any rights such Stockholder may have.

        8.    Termination.    This Agreement and each of the Proxies delivered in connection herewith shall terminate and shall have no further force or effect as of the Expiration Date; provided, however, that no such termination of this Agreement or the Proxies shall relieve the Stockholders from any liability for any breach of this Agreement or the Proxies prior to their respective termination. Notwithstanding any other provision of this Agreement, the Stockholders, acting unanimously, may terminate this Agreement and any Proxy and be released from all obligations to vote their respective Shares, in accordance with the provisions of this Agreement or to have their respective Shares voted in accordance with any Proxy in the event the Purchase Agreement is materially amended or modified. For purposes of this Section 8, an extension of the terminate date set forth in Section 11.1(b) of the Purchase Agreement shall not be deemed to be a material amendment or modification of the Purchase Agreement.

        9.    Miscellaneous.    

E-3

or to such other place and with such other copies as any party may designate as to itself by written notice to the others.

E-4

[SIGNATURE PAGE TO FOLLOW]

E-5

        IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed as of the date first above written.

    SERACARE LIFE SCIENCES, INC.,
a California corporation

 
 
By:
/s/  MICHAEL F. CROWLEY II      
Name: Michael F. Crowley
Title: CEO

 
 
Address: 1935 Avenida del Oro, Suite F
                  Oceanside, CA 92056
                  Attention: President
                  Facsimile No.: (760) 806-8933

 
 
STOCKHOLDER

 
 
By:
/s/  RICHARD P. KIPHART      
Name: Richard P. Kiphart
Title:  —

 
 
Address:
608 Elm Street
Winnetka, IL 60093

 
 
Shares beneficially owned:
 
   Class of Shares
   Number
    Common Stock   1,542,985
    STOCKHOLDER
Shoreline Micro-Cap Fund I LP

 
 
By:
/s/  RICHARD P. KIPHART      
Name: Richard P. Kiphart
Title: Partner

 
 
Address:
c/o William Blair & Co.
(Richard P. Kiphart)
222 W. Adams Street
Chicago, IL 60606

 
 
Shares beneficially owned:
 
   Class of Shares
   Number
    Common Stock   365,613

S-1

    STOCKHOLDERS

 
 
By:
/s/  REBECCA S. KIPHART      
Name: Rebecca S. Kiphart
Title:  —

 
 
Address:
608 Elm Street
Winnetka, IL 60093

 
 
Shares beneficially owned:
 
   Class of Shares
   Number
    Common Stock   90,000

S-2


SCHEDULE 1

IRREVOCABLE PROXY TO VOTE STOCK OF PARENT

        The undersigned stockholder of Boston Biomedica, Inc., a Massachusetts corporation ("Parent"), hereby irrevocably appoints the Chief Executive Officer and Chief Financial Officer from time to time (currently Michael Crowley, Jr. and Tim Hart, respectively) of SeraCare Life Sciences, Inc., a California corporation ("Buyer"), and each of them, as the sole and exclusive attorneys and proxies of the undersigned, with full power of substitution and resubstitution, to vote and exercise all voting and related rights (to the full extent that the undersigned is entitled to do so) with respect to all of the shares of capital stock of Parent that now are or hereafter may be beneficially owned by the undersigned, and any and all other shares or securities of Parent issued or issuable in respect thereof on or after the date hereof (collectively, the "Shares") in accordance with the terms of this Proxy. The Shares beneficially owned by the undersigned stockholder of Parent as of the date of this Proxy are listed on the final page of this Proxy. Upon the undersigned's execution of this Proxy, any and all prior proxies given by the undersigned with respect to any Shares are hereby revoked and the undersigned agrees not to grant any subsequent proxies with respect to the Shares and this subject matter until after the Expiration Date (as defined below).

        This Proxy is irrevocable, is granted pursuant to that certain Voting Agreement of even date herewith, by and between Buyer and the undersigned stockholder, among others (the "Voting Agreement"), and is granted in consideration of Buyer entering into that certain Asset Purchase Agreement, of even date herewith, by and among Parent, Buyer and BBI Biotech Research Laboratories, Inc., a Massachusetts corporation (the "Purchase Agreement"). This Proxy shall terminate on the Expiration Date (as such term is defined in the Voting Agreement). Notwithstanding any other provision of this Proxy, the undersigned stockholder may terminate this Proxy and be released from all obligations to vote his Shares in accordance with the provisions of this Proxy in the event the Voting Agreement is terminated pursuant to Section 8 of the Voting Agreement.

        The attorneys and proxies named above, and each of them, are hereby authorized and empowered by the undersigned, at any time prior to the Expiration Date, to act as the undersigned's attorney and proxy to vote the Shares, and to exercise all voting and other rights of the undersigned with respect to the Shares (including, without limitation, the power to execute and deliver written consents pursuant to Section 43 of Chapter 156B of the Annotated Laws of Massachusetts, or such successor provision of the law contained in Chapter 156D of the Massachusetts Business Corporation Act, which becomes effective on July 1, 2004), at every annual, special or adjourned meeting of the stockholders of Parent and in every written consent in lieu of such meeting (i) in favor of approval of the Purchase Agreement and in favor of any matter necessary to facilitate the Purchase Agreement, and (ii) against any Acquisition Proposal (as such term is defined in the Purchase Agreement), or any other action or agreement that would result in a breach of any covenant, representation or warranty or any other obligation or agreement of Parent under the Purchase Agreement or which could reasonably be expected to result in any of the conditions to Parent's obligations under the Purchase Agreement not being fulfilled; provided, however, that the undersigned shall not be required to vote the Shares and any New Shares in favor of approval of the matters identified in clause (i) or against the matters identified in clause (ii) of this paragraph if (A) a Superior Offer (as such term is defined in the Purchase Agreement) is made after the date of this Agreement, and (B) in response to such Superior Offer the Board of Directors of Parent withholds, withdraws, amends or modifies its recommendation in favor of the Stockholder Approval Matters (as such term is defined in the Purchase Agreement) in a manner materially adverse to Buyer because the Board of Directors of Parent has reasonably concluded in good faith, after consultation with its outside counsel, that the failure to withhold, withdraw, amend or modify such recommendation would violate its fiduciary obligations under applicable law. The attorneys and proxies named above may not exercise this Proxy on any other matter except as provided above. The undersigned stockholder may vote the Shares on all other matters.

Schedule 1-1


        Any obligation of the undersigned hereunder shall be binding upon the successors and assigns of the undersigned.

[SIGNATURE PAGE TO FOLLOW]

Schedule 1-2

        IN WITNESS WHEREOF, the undersigned has caused this Proxy to be executed as of the date set forth below.


Dated: April 16, 2004
 
By:
/s/  RICHARD P. KIPHART      
Richard P. Kiphart

 
 
Shares beneficially owned:
 
   Class of Shares
   Number
  
    Common Stock   1,542,985 *
*
Includes (i) 90,000 shares of Common Stock held of record by Rebecca Kiphart, (ii) 357,791 shares of Common Stock held of record by Shoreline Micro-Cap Fund I LP, (iii) warrants to purchase an aggregate of 7,822 shares of Common Stock held of record by Shoreline Micro-Cap Fund I LP, (iv) warrants to purchase an aggregate of 27,734 shares of Common Stock held of record by Richard Kiphart.

Schedule 1-3


SCHEDULE 1

IRREVOCABLE PROXY TO VOTE STOCK OF PARENT

        The undersigned stockholder of Boston Biomedica, Inc., a Massachusetts corporation ("Parent"), hereby irrevocably appoints the Chief Executive Officer and Chief Financial Officer from time to time (currently Michael Crowley, Jr. and Tim Hart, respectively) of SeraCare Life Sciences, Inc., a California corporation ("Buyer"), and each of them, as the sole and exclusive attorneys and proxies of the undersigned, with full power of substitution and resubstitution, to vote and exercise all voting and related rights (to the full extent that the undersigned is entitled to do so) with respect to all of the shares of capital stock of Parent that now are or hereafter may be beneficially owned by the undersigned, and any and all other shares or securities of Parent issued or issuable in respect thereof on or after the date hereof (collectively, the "Shares") in accordance with the terms of this Proxy. The Shares beneficially owned by the undersigned stockholder of Parent as of the date of this Proxy are listed on the final page of this Proxy. Upon the undersigned's execution of this Proxy, any and all prior proxies given by the undersigned with respect to any Shares are hereby revoked and the undersigned agrees not to grant any subsequent proxies with respect to the Shares and this subject matter until after the Expiration Date (as defined below).

        This Proxy is irrevocable, is granted pursuant to that certain Voting Agreement of even date herewith, by and between Buyer and the undersigned stockholder, among others (the "Voting Agreement"), and is granted in consideration of Buyer entering into that certain Asset Purchase Agreement, of even date herewith, by and among Parent, Buyer and BBI Biotech Research Laboratories, Inc., a Massachusetts corporation (the "Purchase Agreement"). This Proxy shall terminate on the Expiration Date (as such term is defined in the Voting Agreement). Notwithstanding any other provision of this Proxy, the undersigned stockholder may terminate this Proxy and be released from all obligations to vote its Shares in accordance with the provisions of this Proxy in the event the Voting Agreement is terminated pursuant to Section 8 of the Voting Agreement.

        The attorneys and proxies named above, and each of them, are hereby authorized and empowered by the undersigned, at any time prior to the Expiration Date, to act as the undersigned's attorney and proxy to vote the Shares, and to exercise all voting and other rights of the undersigned with respect to the Shares (including, without limitation, the power to execute and deliver written consents pursuant to Section 43 of Chapter 156B of the Annotated Laws of Massachusetts, or such successor provision of the law contained in Chapter 156D of the Massachusetts Business Corporation Act, which becomes effective on July 1, 2004), at every annual, special or adjourned meeting of the stockholders of Parent and in every written consent in lieu of such meeting (i) in favor of approval of the Purchase Agreement and in favor of any matter necessary to facilitate the Purchase Agreement, and (ii) against any Acquisition Proposal (as such term is defined in the Purchase Agreement), or any other action or agreement that would result in a breach of any covenant, representation or warranty or any other obligation or agreement of Parent under the Purchase Agreement or which could reasonably be expected to result in any of the conditions to Parent's obligations under the Purchase Agreement not being fulfilled; provided, however, that the undersigned shall not be required to vote the Shares and any New Shares in favor of approval of the matters identified in clause (i) or against the matters identified in clause (ii) of this paragraph if (A) a Superior Offer (as such term is defined in the Purchase Agreement) is made after the date of this Agreement, and (B) in response to such Superior Offer the Board of Directors of Parent withholds, withdraws, amends or modifies its recommendation in favor of the Stockholder Approval Matters (as such term is defined in the Purchase Agreement) in a manner materially adverse to Buyer because the Board of Directors of Parent has reasonably concluded in good faith, after consultation with its outside counsel, that the failure to withhold, withdraw, amend or modify such recommendation would violate its fiduciary obligations under applicable law. The attorneys and proxies named above may not exercise this Proxy on any other matter except as provided above. The undersigned stockholder may vote the Shares on all other matters.

Schedule 1-1


        Any obligation of the undersigned hereunder shall be binding upon the successors and assigns of the undersigned.

[SIGNATURE PAGE TO FOLLOW]

Schedule 1-2

        IN WITNESS WHEREOF, the undersigned has caused this Proxy to be executed as of the date set forth below.


 
 
SHORELINE MICRO-CAP FUND I LP

Dated: April 16, 2004
 
By:
/s/  RICHARD P. KIPHART      
Name: Richard P. Kiphart
Title: Partner

 
 
Shares beneficially owned:
 
   Class of Shares
   Number
    Common Stock   365,613*
*
Includes warrants to purchase an aggregate of 7,822 shares of Common Stock.

Schedule 1-3


SCHEDULE 1

IRREVOCABLE PROXY TO VOTE STOCK OF PARENT

        The undersigned stockholder of Boston Biomedica, Inc., a Massachusetts corporation ("Parent"), hereby irrevocably appoints the Chief Executive Officer and Chief Financial Officer from time to time (currently Michael Crowley, Jr. and Tim Hart, respectively) of SeraCare Life Sciences, Inc., a California corporation ("Buyer"), and each of them, as the sole and exclusive attorneys and proxies of the undersigned, with full power of substitution and resubstitution, to vote and exercise all voting and related rights (to the full extent that the undersigned is entitled to do so) with respect to all of the shares of capital stock of Parent that now are or hereafter may be beneficially owned by the undersigned, and any and all other shares or securities of Parent issued or issuable in respect thereof on or after the date hereof (collectively, the "Shares") in accordance with the terms of this Proxy. The Shares beneficially owned by the undersigned stockholder of Parent as of the date of this Proxy are listed on the final page of this Proxy. Upon the undersigned's execution of this Proxy, any and all prior proxies given by the undersigned with respect to any Shares are hereby revoked and the undersigned agrees not to grant any subsequent proxies with respect to the Shares and this subject matter until after the Expiration Date (as defined below).

        This Proxy is irrevocable, is granted pursuant to that certain Voting Agreement of even date herewith, by and between Buyer and the undersigned stockholder, among others (the "Voting Agreement"), and is granted in consideration of Buyer entering into that certain Asset Purchase Agreement, of even date herewith, by and among Parent, Buyer and BBI Biotech Research Laboratories, Inc., a Massachusetts corporation (the "Purchase Agreement"). This Proxy shall terminate on the Expiration Date (as such term is defined in the Voting Agreement). Notwithstanding any other provision of this Proxy, the undersigned stockholder may terminate this Proxy and be released from all obligations to vote her Shares in accordance with the provisions of this Proxy in the event the Voting Agreement is terminated pursuant to Section 8 of the Voting Agreement.

        The attorneys and proxies named above, and each of them, are hereby authorized and empowered by the undersigned, at any time prior to the Expiration Date, to act as the undersigned's attorney and proxy to vote the Shares, and to exercise all voting and other rights of the undersigned with respect to the Shares (including, without limitation, the power to execute and deliver written consents pursuant to Section 43 of Chapter 156B of the Annotated Laws of Massachusetts, or such successor provision of the law contained in Chapter 156D of the Massachusetts Business Corporation Act, which becomes effective on July 1, 2004), at every annual, special or adjourned meeting of the stockholders of Parent and in every written consent in lieu of such meeting (i) in favor of approval of the Purchase Agreement and in favor of any matter necessary to facilitate the Purchase Agreement, and (ii) against any Acquisition Proposal (as such term is defined in the Purchase Agreement), or any other action or agreement that would result in a breach of any covenant, representation or warranty or any other obligation or agreement of Parent under the Purchase Agreement or which could reasonably be expected to result in any of the conditions to Parent's obligations under the Purchase Agreement not being fulfilled; provided, however, that the undersigned shall not be required to vote the Shares and any New Shares in favor of approval of the matters identified in clause (i) or against the matters identified in clause (ii) of this paragraph if (A) a Superior Offer (as such term is defined in the Purchase Agreement) is made after the date of this Agreement, and (B) in response to such Superior Offer the Board of Directors of Parent withholds, withdraws, amends or modifies its recommendation in favor of the Stockholder Approval Matters (as such term is defined in the Purchase Agreement) in a manner materially adverse to Buyer because the Board of Directors of Parent has reasonably concluded in good faith, after consultation with its outside counsel, that the failure to withhold, withdraw, amend or modify such recommendation would violate its fiduciary obligations under applicable law. The attorneys and proxies named above may not exercise this Proxy on any other matter except as provided above. The undersigned stockholder may vote the Shares on all other matters.

Schedule 1-1


        Any obligation of the undersigned hereunder shall be binding upon the successors and assigns of the undersigned.

[SIGNATURE PAGE TO FOLLOW]

Schedule 1-2

        IN WITNESS WHEREOF, the undersigned has caused this Proxy to be executed as of the date set forth below.


Dated: April 16, 2004
 
By:
/s/  REBECCA S. KIPHART      
Rebecca S. Kiphart

 
 
Shares beneficially owned:
 
   Class of Shares
   Number
    Common Stock   90,000

Schedule 1-3

BOSTON BIOMEDICA, INC.
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS FOR
THE SPECIAL MEETING OF STOCKHOLDERS TO BE HELD ON SEPTEMBER 14, 2004

        The undersigned hereby appoints Kevin W. Quinlan and Kathleen W. Benjamin, and each of them, with full power of substitution, attorneys and proxies to represent the undersigned at the Special Meeting of Stockholders of Boston Biomedica, Inc. (the "Company") to be held on September 14, 2004 and at any adjournment or adjournments thereof, with all power which the undersigned may be entitled to vote at said meeting upon the following proposals more fully described in the notice of and proxy statement for the meeting in accordance with the following instructions and with discretionary authority upon such other matters as may come before the meeting. All previous proxies are hereby revoked.

        The Board of Directors unanimously recommends that stockholders vote "FOR" each of the proposals identified below, as described in the proxy statement.

PROPOSAL ONE:   To approve a proposal to sell the assets of the Company's BBI Diagnostics and BBI Biotech business units, which assets constitute substantially all of the assets of the Company, to SeraCare Life Sciences, Inc. ("SeraCare") for cash pursuant to the terms and conditions of that certain Asset Purchase Agreement dated April 16, 2004 between the Company, BBI Biotech Research Laboratories, Inc. and SeraCare, as set forth in the proxy statement provided to stockholders.

 
 
o FOR                o AGAINST                o ABSTAIN

PROPOSAL TWO:
 
To approve a proposal to amend the Company's Restated Articles of Organization, as amended, to change the corporate name of the Company to "Pressure BioSciences, Inc." promptly following the completion of the sale to SeraCare, as set forth in the proxy statement provided to stockholders.

 
 
o FOR                o AGAINST                o ABSTAIN

PROPOSAL THREE:
 
To approve a proposal to grant the persons named as proxies discretionary authority to vote to adjourn the special meeting, if necessary, to solicit additional proxies to vote in favor of Proposal Nos. 1 and 2, as set forth in the proxy statement provided to stockholders.

 
 
o FOR                o AGAINST                o ABSTAIN

        DISCRETIONARY AUTHORITY IS HEREBY CONFERRED AS TO ALL OTHER
MATTERS WHICH MAY PROPERLY COME BEFORE THIS SPECIAL MEETING.

THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR PROPOSAL NOS. 1, 2 AND 3. THE PROXY MAY VOTE IN HIS OR HER DISCRETION AS TO OTHER MATTERS WHICH MAY PROPERLY COME BEFORE THE MEETING.

NOTE: Signatures should correspond exactly with the name or names appearing on the stock certificate(s). If shares are registered in more than one name, all holders must sign. A corporation should sign in its full corporate name by a duly authorized officer, stating his or her title. Trustees,


guardians, executors and administrators should sign in their official capacity, giving full title as such. If a partnership, please sign in the partnership name by an authorized person.

    Dated: _____________________, 2004

 
 
Name(s) of Stockholder(s)

 
 
Signature(s) of Stockholder(s)

Please mark, sign, date and return this proxy promptly, using the enclosed envelope.

No postage necessary.

Please Return Proxy As Soon As Possible