VRNM Verenium Corp. (MM)

Employee Benefits

        For a period of 12 months following the Effective Time, with respect to employees of Verenium immediately before the Effective Time who remain employed during such 12-month period, Parent will provide, or will cause to be provided, base salary and base wages, short-term cash incentive compensation opportunities and benefits (excluding equity or equity based compensation and retention, change in control and other transaction-based compensation) that are substantially comparable in the aggregate to such base salary and base wages, short-term cash incentive compensation opportunities and benefits (excluding equity or equity based compensation and retention, change in control and other transaction-based compensation) provided to such employees immediately prior to the execution of the Merger Agreement.

Potential for Future Arrangements

        To our knowledge, except for certain agreements described in this Schedule 14D-9 between Verenium and its executive officers and directors, no employment, equity contribution or other agreement, arrangement or understanding between any executive officer or director of Verenium, on the one hand, and Parent, Purchaser, any of their affiliates or Verenium, on the other hand, existed as of the date of this Schedule 14D-9, and neither the Offer nor the Merger is conditioned upon any executive officer or director of Verenium entering into any such agreement, arrangement or understanding.

        It is possible that certain members of our current management team will enter into new employment arrangements with the Surviving Corporation after the completion of the Offer and the Merger. Such arrangements may include the right to purchase or participate in the equity of Purchaser or its affiliates. Any such arrangements with the existing management team are currently expected to be entered into after the completion of the Offer and will not become effective until after the Merger is

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completed, if at all. There can be no assurance that the applicable parties will reach an agreement on any terms, or at all.

Director Compensation

        For 2013, each non-employee director of Verenium receives an annual retainer of $25,000, a fee of $1,500 per board meeting attended, and a fee of $1,000 per meeting for committee participation. Directors who serve as committee chairpersons for Board committees receive an additional fee of $1,000 per committee meeting, with the chair of the audit committee receiving an additional annual retainer of $7,500. Each non-employee director is also eligible to receive stock options under Verenium's 2010 Equity Incentive Plan (the "2010 Plan"). While the 2010 Plan is open to both employees and non-employees, options granted to non-employee directors under the 2010 Plan are intended by Verenium not to qualify as incentive stock options under the Code. Stock awards and awards of stock options to non-employee directors under the 2010 Plan are discretionary, with the exception of an automatic annual grant of options to purchase 6,000 shares of Common Stock to each non-employee director who has served on our Board of Directors for at least 12 months, that is granted on the next business day following the date of each annual meeting of stockholders. Each new non-employee director joining our Board of Directors receives a non-statutory stock option grant to purchase 6,000 shares of Common Stock. As of September 20, 2013, 73,570 shares of Common Stock underlying Stock Options held by our directors remained unvested.

Indemnification of Directors and Officers; Insurance

        The Merger Agreement provides that all existing rights to indemnification that the present directors and officers of Verenium are entitled to that are contained in the organizational documents of Verenium as in effect as of the date of the Merger Agreement, or as provided in any indemnification agreement between Verenium and any such person as in effect as of the date of the Merger Agreement, will survive the Merger and will be observed by the Surviving Corporation (and Parent shall cause the Surviving Corporation to observe them) to the fullest extent available under Delaware law for a period of six years from the Effective Time.

        The Merger Agreement also provides that, prior to the Effective Time, we will obtain and fully pay the premium for the non-cancellable extension of the directors' and officers' liability coverage of our existing directors' and officers' insurance policies and our existing fiduciary liability insurance policies, in each case for a claims reporting or discovery period of at least six years from and after the Effective Time with respect to any claim related to any period of time at or prior to the Effective Time from our current insurance carrier. We are required to consult with Parent prior to purchasing such extensions to our insurance policies.

(b)

Arrangements with Purchaser and Parent and their Affiliates.

Merger Agreement

        On September 19, 2013, Verenium, Parent and Purchaser entered into the Merger Agreement. The summary of the material provisions of the Merger Agreement contained in Section 13—"The Transaction Documents—The Merger Agreement" of the Offer to Purchase and the description of the conditions of the Offer contained in Section 15—"Conditions of the Offer" of the Offer to Purchase are incorporated herein by reference. Such summary and description are qualified in their entirety by reference to the Merger Agreement, which is filed as Exhibit (e)(1) hereto and is incorporated herein by reference.

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Mutual Non-Disclosure Agreement

        On May 1, 2013, Parent and Verenium entered into a Confidentiality, Non-Disclosure and Non-Solicitation Agreement (the "Non-Disclosure Agreement"). Under the terms of the Non-Disclosure Agreement, Parent agreed that, subject to certain exceptions, any non-public information regarding Verenium provided to Parent or to its representatives for the purposes of evaluating and/or negotiating potential strategic transactions between the parties would, for a period of one year from the date of the original Non-Disclosure Agreement, be kept confidential, except as provided in the Non-Disclosure Agreement. The Non-Disclosure Agreement includes a standstill provision for the benefit of Verenium that expires one year following the date of the Non-Disclosure Agreement.

        This summary and description of the Non-Disclosure Agreement is qualified in its entirety by reference to the Non-Disclosure Agreement, which is filed as Exhibit (e)(16) hereto and incorporated herein by reference.

(c)

Arrangements among Parent, Purchaser, and Certain Executive Officers, Officers, Directors and Stockholders of Verenium.

Tender and Support Agreements

        On September 19, 2013, our executive officers and directors (collectively, the "Supporting Stockholders") each entered into a tender and support agreement with Parent and Purchaser (collectively, the "Tender and Support Agreements") under which each Supporting Stockholder, among other things, (i) agreed to validly tender (or cause to be tendered) in the Offer any and all Shares of which such Supporting Stockholder is the record or beneficial owner and any additional Shares with respect to which such Supporting Stockholder becomes the record or beneficial owner after the date of the relevant Tender and Support Agreement and prior to the Expiration Date pursuant to the terms of the Offer promptly, but no later than ten business days following commencement of the Offer, (ii) agreed to certain restrictions on the transfer of such Shares or entering into any arrangements with respect to the voting of such Shares or that are otherwise inconsistent with the terms of such Supporting Stockholder's Tender and Support Agreement, (iii) agreed to vote such Shares in favor of each of the actions contemplated by the Merger Agreement and any action in furtherance of any of the foregoing, (iv) agreed to vote such Shares against (a) any action or agreement that would result in a breach of any representation, warranty, covenant or obligation of Verenium in the Merger Agreement, (b) any third-party proposal to acquire 80% or more of the assets or any class of securities of Verenium, (c) any amendment to Verenium's certificate of incorporation or bylaws, (d) any material change in the capitalization of Verenium or its corporate structure, and (e) any other action which is intended or could reasonably be expected to prevent, impede, interfere with, delay, postpone, discourage or adversely affect any of the Transactions or such Supporting Stockholder's Tender and Support Agreement, and (v) granted to Parent and Purchaser, or any of their nominees, an irrevocable proxy to vote such Supporting Stockholder's Shares in accordance with the foregoing clauses (iii) and (iv). Each Supporting Stockholder's Tender and Support Agreement will terminate upon the earlier of (A) the Effective Time, or (B) the date upon which the Merger Agreement is validly terminated. As of September 20, 2013, the outstanding Shares subject to the Tender and Support Agreements represented approximately 2.6% of the total outstanding Shares.

        The foregoing summary and description of the Tender and Support Agreements are qualified in their entirety by reference to the Tender and Support Agreements, the form of which is filed as Exhibit (e)(13) and are incorporated herein by reference.

         The Merger Agreement and the Tender and Support Agreements have been filed as exhibits to the Schedule 14D-9 to provide stockholders with information regarding their terms and are not intended to modify or supplement any factual disclosures about Verenium in Verenium's public reports filed with the

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SEC. The Merger Agreement and the Tender and Support Agreements and the summary of their terms contained in the Offer to Purchase filed by Purchaser with the SEC on October 2, 2013 are incorporated herein by reference, and are not intended to provide any other factual information about Verenium. The representations, warranties and covenants contained in each agreement referenced in this Schedule 14D-9 were made only for the purposes of such agreement and as of specified dates, were solely for the benefit of the other party(ies) to such agreement, and may be subject to limitations agreed upon by the parties to such agreement. The representations and warranties may have been made for the purposes of allocating contractual risk between the parties to the agreements instead of establishing these matters as facts, and may be subject to standards of materiality applicable to the contracting parties that differ from those applicable to investors. Neither investors nor stockholders are third-party beneficiaries under the Merger Agreement, except with respect to receipt of the Offer Price or the Merger Consideration, or the Tender and Support Agreements. Accordingly, investors and stockholders should not rely on such representations, warranties and covenants as characterizations of the actual state of facts or circumstances described therein. Information concerning the subject matter of such representations and warranties may change after the date of the agreements, which subsequent information may or may not be fully reflected in the parties' public disclosures.

Item 4.    The Solicitation or Recommendation.

        On September 19, 2013, our Board of Directors unanimously (i) determined that the Transactions are fair to and in the best interests of Verenium and its stockholders, (ii) approved and declared advisable the Merger Agreement and the Transactions, (iii) resolved to recommend that Verenium's stockholders accept the Offer and tender their Shares to Purchaser pursuant thereto and (iv) agreed that the Merger Agreement shall be subject to Section 251(h) of the DGCL.

         Accordingly, and for other reasons described in more detail below, our Board of Directors unanimously recommends that holders of Shares accept the Offer and tender their Shares pursuant to the Offer.

(i)

Background of Offer and Merger

        Verenium is an industrial biotechnology company with recognized market-leading technology, which it uses to develop and commercialize high performance enzymes for use in a broad array of industrial processes. Through its use of tailored enzyme products, Verenium can help industries replace expensive and oftentimes harmful chemical processes with more efficient and environmentally-friendly biological processes.

        As part of Verenium's ongoing strategic planning process, and in light of Verenium's capital resources and its ongoing capital requirements in seeking to develop and commercialize Verenium's products, Verenium regularly reviews its cash position and anticipated use of cash resources and explores its potential financing and strategic alternatives. Verenium issued 5.5% convertible notes due 2027 (the "2007 Notes") in March 2007 that, pursuant to their terms, required Verenium to offer to repurchase the 2007 Notes on April 2, 2012 at a repurchase price equal to 100% of their principal amount plus accrued interest. Given that the 2007 Notes were convertible into shares of Verenium common stock at a conversion price that far exceeded the then-current trading price for Verenium's common stock, Verenium's management anticipated that each holder of the 2007 Notes would accept Verenium's repurchase offer and Verenium would be obligated to repurchase all 2007 Notes outstanding as of April 2, 2012 (which were approximately $35 million in aggregate principal amount) at the repurchase price or be in default under the 2007 Notes. With this known and large cash requirement approaching, Verenium worked with financial advisors and explored, without success, starting in the first quarter of 2011 and through the remainder of 2011, potential financing alternatives to provide Verenium the necessary funds to enable it to repurchase all the outstanding 2007 Notes when it would be required to do so. During this period Verenium entered into a term-sheet for a senior secured loan that would have helped provide the necessary funding. However, by December

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2011, the counter-party to the term-sheet indicated that it was not willing to proceed with the transaction.

        In January 2012, with Verenium having failed to secure financing to fund its anticipated required repurchase of all then-outstanding 2007 Notes in April 2012, the Board of Directors advised Verenium's management to consider all strategic alternatives, including continuing to pursue financing alternatives (including restructuring the 2007 Notes), a sale of assets of the company and the sale of the entire company. In September 2009, Verenium engaged UBS as its financial advisor in connection with a possible sale of Verenium's commercial enzyme business because UBS is an internationally recognized investment bank and based upon UBS's knowledge of the industrial biotechnology industry, experience and reputation and familiarity with Verenium. In 2010, Verenium sold its cellulosic biofuels business to BP Biofuels North America, and retained its commercial enzyme business but UBS continued to work under that engagement letter, which was amended on March 2, 2012 to, among other matters, extend its term, throughout the first quarter of 2012. In addition, on January 27, 2012, Verenium engaged UBS as its financial advisor in connection with a possible restructuring of the 2007 Notes based upon UBS's knowledge of the 2007 Notes and their holders (UBS had acted as an initial purchaser in connection with Verenium's original issuance of the 2007 Notes), as well as, again, UBS's experience and reputation and familiarity with Verenium. Verenium at this time was also working with another financial advisor who was assisting it with other possible financing alternatives. In accordance with the Board's directives, Verenium's management and representatives of UBS and Verenium's other financial advisor continued to contact financing sources and explored strategic, convertible debt, secured debt and equity financing options. During the first quarter of 2012, Verenium's management and representatives of UBS also contacted seven strategic parties, entered into confidentiality agreements with multiple parties and received three non-binding proposals to acquire all of the stock of the company, subject to due diligence reviews.

        By March 5, 2012, Verenium had been unable to secure financing that would have enabled it to fund its anticipated required repurchase of the 2007 Notes on April 2, 2012, and had also not entered into a sale transaction. On March 5, 2012, Verenium publicly announced that it had filed a tender offer with respect to its offer to repurchase the 2007 Notes, as it was required to do pursuant to the terms of the 2007 Notes, and also publicly announced that, based on then-current cash resources, Verenium did not have sufficient funds to repurchase the 2007 Notes in the event all holders of the 2007 Notes accepted Verenium's repurchase offer. Verenium disclosed that it was considering two primary alternatives to address its capital requirements: issuing new equity-linked or equity securities and converting the 2007 Notes into equity along with a partial repayment thereof, and/or a combination of the foregoing; and actively evaluating options for a potential sale of Verenium. Verenium also disclosed that it had received non-binding proposals from more than one prospective purchaser to acquire all of the stock of Verenium.

        Following the public announcement of its strategic review process, representatives of Rothschild Inc. and Rothschild GmbH ("Rothschild"), BASF's financial advisor, contacted representatives of UBS to express BASF's interest in exploring a potential business combination with Verenium and on March 14, 2012, BASF entered into a confidentiality agreement with Verenium that included a one-year standstill arrangement.

        Around March 15, 2012, Verenium delivered a proposed form of merger agreement to BASF. From around March 14 to March 22, 2012 representatives of BASF engaged with representatives of Verenium in a due diligence process, including conference calls and a site visit to Verenium's facility.

        On March 19, 2012, Lowenstein Sandler LLP ("Lowenstein"), legal counsel to BASF, and Cooley LLP ("Cooley"), legal counsel to Verenium, held a telephone conference to discuss certain transaction structure and diligence matters.

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        By March 25, 2012, Verenium had been unsuccessful in obtaining financing to repurchase the 2007 Notes that were coming due and none of the companies it had been in discussions with regarding a sale were able to consummate an acquisition of the company prior to the repurchase deadline. On March 26, 2012, Verenium entered into an asset purchase agreement with DSM Food Specialties B.V. ("DSM"), pursuant to which DSM purchased Verenium's oilseed processing business and additional assets for $37 million in proceeds. The proceeds were used to pay off the 2007 Notes and Verenium ceased all discussions regarding a sale of the entire company.

        On April 23, 2012, BASF certified to Verenium that BASF destroyed or permanently deleted all confidential information (except for archival purposes) in compliance with the terms of the confidentiality agreement.

        In May and June 2012, representatives of Verenium met with representatives of BASF in Germany to make a presentation and discuss partnering opportunities. In connection with the partnership discussions, BASF and Verenium entered into a customary confidentiality agreement covering the potential commercial relationship.

        On December 7, 2012, representatives of BASF and Verenium met in San Diego to discuss a potential collaboration in the field of enzymes for feed, food and detergent applications.

        Thereafter through March 2013, Verenium and BASF continued to have discussions regarding a potential collaboration and exchanged a draft framework collaboration agreement.

        On March 26, 2013, representatives of BASF, including Dr. Alexandra Brand, Senior Vice President, met with James Levine, Chief Executive Officer of Verenium, in San Diego to discuss the proposed collaboration. At the meeting, the representatives of BASF made an unsolicited oral indication of interest, on behalf of BASF, to acquire Verenium in lieu of pursuing a collaboration. Mr. Levine advised Dr. Brand that the Board of Directors had not determined to put the company up for sale but that he would advise the Board of Directors of BASF's overture.

        On March 27, 2013, Mr. Levine contacted Dr. James Cavanaugh, Chairman of the Board of Directors, to inform him of the unsolicited indication of interest from BASF.

        On March 29, 2013, Dr. Brand and Mr. Levine had a telephonic meeting, which was attended by other representatives of BASF and Verenium, to discuss BASF's interest in an acquisition. Dr. Brand indicated that BASF would follow-up with a written indication of interest which would include specific terms.

        On April 1, 2013, BASF provided a written, non-binding indication of interest to acquire all of the outstanding shares of Verenium's common stock for $3.75 per share (the "April 1 Letter"). The April 1 Letter stated that the non-binding indication of interest was subject to completion of due diligence and other conditions including, receipt of necessary internal approvals and negotiation of satisfactory transaction documentation. The April 1 Letter also indicated that the indication was subject to BASF being given a period of exclusive negotiations. The proposal stated that it was not subject to any financing contingency.

        On April 2, 2013, representatives of BASF, including Rothschild and representatives of Verenium had a telephonic meeting to provide an explanation for the financial terms in the offer.

        On April 8, 2013, the Board of Directors held a meeting, with representatives of Verenium's management and Cooley LLP ("Cooley"), Verenium's outside counsel, participating in the meeting. A representative of Cooley first reviewed fiduciary duty considerations in connection with the review of an all cash acquisition proposal. The Board discussed the April 1 Letter from BASF, including the process for evaluating the BASF proposal and possible responses to the BASF proposal. Following a discussion with management and an executive session without management present, the Board advised management to inform BASF that their offer was not compelling and that a higher valuation would be

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required for further consideration of such a transaction. The Board also advised management to seek the advice of an investment bank regarding the proposal.

        On April 9, 2013, Mr. Levine contacted Dr. Brand to inform her that after consideration of the April 1 Letter, the Board of Directors had determined not to proceed with discussions regarding such a transaction with BASF based on the terms proposed. In response, Dr. Brand requested a meeting with representatives of Verenium management to verify certain assumptions on which the April 1 Letter was based. Mr. Levine requested a letter outlining the terms and purpose of the request.

        On April 12, 2013, BASF delivered a letter to Verenium expressing its continued interest in the acquisition and requesting a meeting with members of Verenium senior management in San Diego to verify certain assumptions on which the April 1 Letter was based and to potentially identify additional areas of value (the "April 12 Letter").

        On April 25, representatives of UBS telephoned representatives of Rothschild in response to the April 12 letter indicating Verenium would make certain members of its management team available in San Diego for an in-person meeting. At that time, Verenium proposed a form of confidentiality agreement that contained a one-year stand-still agreement.

        On May 2, 2013, Verenium and BASF entered into a customary confidentiality agreement containing a one-year stand-still agreement.

        On May 3, 2013, following the directive of the Board of Directors, Verenium entered into a formal engagement letter with UBS based upon UBS's knowledge of the industrial biotechnology industry, experience and reputation and familiarity with Verenium.

        On May 16, 2013, the Board of Directors met, with representatives of Verenium's management, legal advisor and financial advisor participating in the meeting. The management team reviewed its five year financial projections for Verenium assuming it remained independent, completed the proposed collaboration with BASF and achieved other key assumptions reviewed with the Board. The Board was made aware of UBS's prior representation of BASF. Representatives of UBS preliminarily reviewed certain financial information and outlined a potential process for engaging in discussions with BASF while soliciting possible interest from other potential strategic buyers in order to maintain a competitive process, taking into consideration the strategic parties involved in Verenium's prior sale process and the strategic parties that might have interest in, and an ability to acquire, Verenium. Representatives of UBS also discussed the efficacy of contacting any potential financial sponsors, given the Company's profile. The financial advisors were then excused from the meeting and a representative of Cooley reviewed fiduciary duty considerations in connection with evaluating a potential sale of Verenium for cash. The Board discussed Verenium's potential strategic alternatives, including remaining independent and proceeding with new product collaborations, and authorized engaging in discussions with BASF and soliciting potential proposals from a selected list of additional strategic parties and agreed that no financial sponsors should be contacted.

        Following the May 16, 2013 meeting of the Board of Directors, in accordance with the Board's directives, in May 2013, Company management and representatives of UBS, on behalf of Verenium, contacted eight strategic parties, including BASF, Company A and Company B, to determine such parties' potential interest in pursuing a strategic transaction with Verenium. Of the eight companies contacted, five parties signed confidentiality agreements or were already a party to a confidentiality agreement and received additional materials and five parties received management presentations.

        On May 20, 2013, representatives of Verenium's management made a management presentation, which included Verenium's financial projections, to representatives of BASF. Following the management presentation, representatives of Rothschild indicated to representatives of UBS that BASF would continue to analyze the opportunity, and expected to be able to provide a revised acquisition proposal to Verenium in mid-late July.

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        On June 6, 2013, representatives of Rothschild contacted representatives of UBS and reiterated that as a result of the BASF internal due diligence process BASF may not be in a position to make a revised proposal until mid-July. Representatives of Rothschild also noted that BASF's internal approval process would require an initial BASF approval be obtained in late-August and a final approval be obtained in mid-September.

        On June 6, 2013, representatives of Verenium's management made a telephonic management presentation to representatives of Company B.

        On June 13, 2013, representatives of Verenium's management made a telephonic management presentation of Verenium's business plan and financial projections to representatives of Company A.

        During the month of June, five of the strategic parties initially contacted in May indicated that they did not wish to pursue a transaction with Verenium. At the request of the Board of Directors, representatives of UBS asked Company A and Company B to submit non-binding indications of interest by July 17, 2013. Verenium was already expecting that BASF would submit a revised indication of interest by July 17, 2013.

        On June 27, 2013, representatives of Verenium met with representatives of Company B to discuss a potential partnering and acquisition alternatives.

        Dr. Brand telephoned Mr. Levine on July 17, 2013 and advised Mr. Levine that BASF was prepared to submit a revised written, non-binding indication of interest to acquire all of the outstanding shares of Verenium's common stock. Dr. Brand and Mr. Levine also discussed a proposed timeline for due diligence and negotiation of transaction agreements.

        Later in the day on July 17, 2013, BASF delivered the written, non-binding indication of interest to acquire all of the outstanding shares of Verenium's common stock for $4.30 per share (the "July 17 Letter"). The non-binding indication of interest was subject to completion of due diligence and other conditions, including receipt of necessary internal approvals and negotiation of satisfactory transaction documentation. The non-binding indication of interest was not subject to a period of exclusive negotiations.

        On July 17, 2013, Company A submitted a non-binding proposal to acquire Verenium in an all cash transaction in the range of $3.25-$4.00 per share. The proposal stated that it was not subject to any financing contingency.

        On July 17, 2013, Company B submitted a non-binding proposal to acquire a minority equity position in Verenium, plus exclusive rights to use Verenium's technology in certain end markets, for $15 million. The proposal stated that it was not subject to any financing contingency.

        On July 19, 2013, the Board of Directors held a meeting, with representatives of Verenium's management, legal advisor and financial advisor participating in the meeting, to discuss the progress on the strategic transaction process, including parties contacted, bids received and likely timetables. Representatives of UBS reviewed financial aspects of the proposals from BASF, Company A and Company B.

        Following the July 19, 2013 meeting of the Board of Directors, representatives of UBS discussed with representatives of Rothschild the process and timing for BASF to complete its due diligence and negotiate a definitive agreement. Representatives of Rothschild informed UBS of the internal process that BASF would need to follow in order to enter into a definitive merger agreement, including its internal committee approval process scheduled for late August and the schedule for the BASF board meeting in mid-September to approve execution of a definitive agreement. Representatives of Rothschild indicated that BASF would need to complete its due diligence prior to its committee approval in late August.

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        Following the July 19, 2013 meeting of the Board of Directors, representatives of UBS also contacted Company B and indicated to Company B that its proposal for an asset purchase was not competitive with the proposals to acquire the entire company received from other parties and suggested that Company B re-evaluate its proposal.

        On July 22, 2013, representatives of UBS contacted representatives of Rothschild to advise that that the Board of Directors would be prepared to proceed with allowing BASF to conduct certain due diligence.

        On July 29, 2013 and August 13, 2013, representatives of BASF and members of Verenium management held due diligence meetings at Verenium's San Diego office. The visit included a tour of Verenium's laboratories.

        In late July, August and early September, one additional strategic party, Company C, one financial sponsor and one additional strategic party contacted UBS, to indicate possible interest in the process. Representatives of UBS contacted all three of these parties to discuss the strategic review process, and all three signed confidentiality agreements and received management presentations. The financial sponsor and Company C had access to the data room and each held due diligence session with Verenium's management. None of these parties submitted indicative or final proposals.

        On August 1, 2013, the Board of Directors met, with representatives of Verenium's management, legal advisor and financial advisor participating in the meeting. Representatives of UBS reviewed the transaction to date, including an update of bids received and a financial analysis of Verenium.

        On August 8, 2013 representatives of BASF and of Verenium made a site visit to Fermic, S.A. de C.V., or Fermic, our contract manufacturing partner in Mexico.

        On August 12, 2013 representatives of Company A and of Verenium made a site visit to Fermic in Mexico.

        On August 13, 2013, in light of the extensive diligence conducted by Company A, a form of merger agreement prepared by Cooley was distributed to Company A. The draft merger agreement contemplated an all cash transaction effected through a cash tender offer for all outstanding shares of Company Common Stock.

        On August 14, 2013, a draft merger agreement prepared by Lowenstein, outside counsel to BASF, was distributed to Verenium. The draft merger agreement contemplated an all cash transaction effected through a cash tender offer for all outstanding shares of Company Common Stock. BASF had previously rejected Verenium's offer to circulate its form of merger agreement to BASF for its consideration. The merger agreement contemplated an unspecified cash consideration. In the draft, BASF proposed uncapped expense reimbursement if the merger agreement was terminated for certain reasons and did not contemplate the Board of Directors' ability to change its recommendation in light of a change in circumstances other than a takeover proposal. The merger agreement markup also contemplated tender and support agreements from unspecified stockholders.

        On August 16, 2013, UBS sent a final bid process letters to Company A which stipulated that a final binding bid, including a marked up merger agreement, would need to be submitted by September 13, 2013.

        On August 20, 2013, Cooley responded with comments to BASF's merger agreement mark up. Among the changes in the mark up were the inclusion of the Board of Directors' ability to change its recommendation in light of a change in circumstances other than a takeover proposal and an elimination of the expense reimbursement provision.

        On August 21, 2013, representatives of Rothschild contacted representatives of UBS and informed such representatives that as a result of certain matters determined during BASF's due diligence, BASF

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would only be prepared to move forward with the proposed transaction at an offer price of $3.90 per share.

        In response to BASF's due diligence concerns, between August 23 and September 13, 2013, representatives of BASF and Verenium, and their respective advisors, held a series of telephonic meetings to discuss the due diligence matters. In addition, Verenium provided BASF additional due diligence materials during this period.

        On August 28, 2013, representatives of the Verenium delivered a counter-proposal to Company B in the form of a term sheet for a joint research and development and commercialization agreement.

        On August 30, 2013, representatives of Rothschild contacted representatives of UBS to inform Verenium that BASF had received its initial internal approval to move forward with the proposed transaction.

        On August 31, 2013, representatives of UBS contacted representatives of Rothschild to inform BASF that Verenium had received one or more competing proposals and that BASF's prior indication of $3.90 per share was not above the valuation range received by Verenium.

        On September 4, 2013, representatives of Verenium contacted Company B to discuss the counter-proposal. Following this meeting, Company B did not initiate any contact with representatives of Verenium to further discuss a strategic transaction with Verenium.

        On September 4, 2013, Lowenstein delivered a revised draft of the merger agreement to Cooley.

        On September 9, 2013, representatives of UBS contacted representatives of Rothschild to communicate that Verenium was soliciting final bids for the sale of Verenium on September 13, 2013. Following the conversation, representatives of UBS transmitted the final bid process letter to BASF.

        On September 10, 2013, Company C informed Verenium that it was withdrawing from the sale process because of a lack of strategic fit. On September 12, 2013, the Board of Directors met, with representatives of Verenium's management, legal advisor and financial advisor participating in the meeting. Representatives of UBS discussed the status of the sales process and discussions with BASF, Company A and Company C and the September 13 deadline for receipt of proposals including transaction value and a mark-up of the draft merger agreement. Management made a presentation to the Board on updated management case financial projections, including the changes in the key assumptions reflected in the updated projections in comparison to the projections presented in May 2013 and the rationale for the changes in the projections. Following a discussion, the Board agreed that the updated management case projections better reflected the ongoing execution risks of the business and agreed that the updated management case projections should be used by UBS for its financial analyses. Representatives of UBS then presented preliminary financial analyses using the updated management case projections.

        On September 10, 2013, Cooley circulated to Lowenstein a revised draft of the merger agreement reflecting, among other matters, increasing the period during which BASF would be required to continue to extend the Offer if all the closing conditions were not satisfied at the then-scheduled expiration, proposing an extension of the "walk away" date, reducing the scope of the representations, warranties and interim operating covenants, expanding the circumstances in which the Board of Directors could change its recommendation of the merger, limiting the circumstances in which a termination fee would be payable and eliminating reimbursement of uncapped expenses upon certain terminations of the merger agreement.

        On September 13, 2013, BASF submitted a revised non-binding offer letter (the "September 13 Letter") along with a revised draft of the merger agreement. The September 13 Letter contained an offer price of $4.00 per share and the accompanying draft merger agreement proposed, among other

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matters, a termination fee of $2.4 million, and the elimination of the expense reimbursement provision. The proposal stated that it was not subject to any financing contingency.

        On September 13, 2013, Company A delivered its final offer to acquire Verenium in an all-cash transaction for $3.25 per share which offer required that Verenium enter into three separate agreements with third parties as a condition to the execution of a merger agreement. The final offer included a markup of the merger agreement which included terms that reduced deal certainty and increased the circumstances in which a termination fee would be payable in comparison to the draft merger agreement provided to Company A as part of the process.

        On September 15, 2013, the Board of Directors met, with representatives of Verenium's management and legal and financial advisors participating in the meeting. Representatives of Cooley provided an overview of the proposals from BASF and Company A and summarized the key open issues in the merger agreement with BASF, including an assessment of Verenium's position on various terms under negotiation, the negotiation process to date with BASF and the negotiation process going forward, and the likelihood and potential timing of reaching agreement with BASF. Representatives of Cooley also discussed Company A's condition that Verenium enter into certain agreements with third parties as a condition to the execution of the merger agreement. The Board directed representatives of UBS to go back to BASF and Company A to negotiate a higher price. In light of the unfavorable price per share in the Company A offer, the Board did not direct Verenium to negotiate the merger agreement with Company A at that point in time.

        On September 16, 2013, at the directive of the Board of Directors, representatives of UBS contacted representatives of Rothschild and indicated that Verenium was willing to continue negotiations with BASF regarding the proposed transaction. On the same day Mr. Levine and Dr. Brand had a telephone conversation wherein Mr. Levine attempted to negotiate an increase in offer price presented in the September 13 Letter. However, Dr. Brand informed Mr. Levine that $4.00 per share was BASF's best and final proposal.

        On September 17, 2013, representatives of Rothschild contacted representatives of UBS to inform Verenium that BASF has received its final internal approval to move forward with the proposed transaction at an offer price of $4.00 per share, subject to completion of any outstanding due diligence matters and final negotiations of the merger agreement.

        On September 18 and 19, 2013, at the directive of the Board of Directors, representatives of UBS contacted representatives of Company A to discuss an increase in the offer price. Company A communicated that it was unwilling to provide a price increase.

        Between September 16, 2013 and September 19, 2013, representatives from Lowenstein and Cooley had a series of telephone conversations to discuss certain open points related to the merger agreement, exchanged drafts of the merger agreement and finalized the merger agreement. In the course of the negotiations, BASF agreed to a reduction in the termination fee payable in certain circumstances from $2.4 million to $2.1 million (or 3.6% of the equity value).

        On September 19, 2013, the Board of Directors held a meeting with Verenium's management and legal and financial advisors. During the meeting, representatives of Cooley first reviewed fiduciary duty considerations in the context of a proposed sale of Verenium for cash. Cooley also reviewed the key provisions of the Merger Agreement, including structure and timing considerations, the operation of Section 251(h) of the DGCL, offer conditions, the non solicitation clause and fiduciary exceptions that would permit Verenium to negotiate and accept an unsolicited superior proposal, subject to compliance with the merger agreement and BASF's matching rights, the change in Board recommendation provisions, termination provisions, termination fee, reverse termination fee and circumstances under which the termination fee and reverse termination fee would be payable. Representatives of Cooley also reviewed the tender and support agreement and percentage of securities that would be subject to these agreements. The Board asked questions and discussed at length the Merger Agreement and

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related documentation. Also at this meeting, UBS reviewed with the Board its financial analysis of the Offer Price and delivered an oral opinion of UBS, which opinion was subsequently confirmed in writing, to the effect that, as of September 19, 2013 and based upon and subject to various assumptions, matters considered and limitations described in the opinion, the Offer Price to be received in the Transactions by holders of Company Common Stock was fair, from a financial point of view, to such holders. In the course of rendering the fairness opinion, UBS again made disclosures regarding its prior representations of BASF. After UBS left the meeting, the Board discussed UBS's prior representation of BASF and concluded that such representation did not pose a conflict to this transaction. After further discussion of the proposed transaction, the Board unanimously determined that the Merger Agreement and the transactions contemplated therein, including the tender offer and the merger, are advisable to, and in the best interest of, Verenium and its stockholders, approved the execution, delivery and performance by Verenium of the Merger Agreement and the consummation of the transactions contemplated therein, including the tender offer and the merger and resolved to recommend that the stockholders of Verenium tender their shares pursuant to the Offer.

        Following the close of markets, on September 19, 2013, the Merger Agreement and tender and support agreements were signed and, prior to the open of markets on September 20, 2013, BASF and Verenium each issued a press release announcing the execution of the Merger Agreement. A copy of Verenium's press release has been filed as Exhibit (a)(5)(A) and is incorporated herein by reference.

(ii)

Reasons for Recommendation

        On September 19, 2013, our Board of Directors unanimously (i) determined that the Transactions are fair to and in the best interests of Verenium and its stockholders, (ii) approved and declared advisable the Merger Agreement and the Transactions, (iii) resolved to recommend that Verenium's stockholders accept the Offer and tender their Shares to Purchaser pursuant thereto and (iv) agreed that the Merger Agreement shall be subject to Section 251(h) of the DGCL.

        Our Board of Directors considered numerous reasons, including the following, each of which is supportive of its decision to approve the Merger Agreement and the Transactions and recommend the Transactions to the Verenium stockholders:

•

the Offer consists solely of cash, providing certainty, immediate value and liquidity to our stockholders;



•

the $4.00 per Share in cash, without interest, represents a 59.4% premium to our closing price of $2.51 on September 19, 2013, the last full trading day before the Transactions were approved by our Board of Directors, a 55.0% premium to our closing price of $2.58 on March 28, 2013, the last full trading day before receipt of BASF's initial written bid, a 55.0% premium to the one month average trading price for our common stock for the month ending on September 19, 2013 and a 10.5% premium to our 52-week high stock price of $3.62 per Share for the 52 weeks ending on September 19, 2013;



•

the belief of our Board of Directors, after a thorough review of strategic alternatives and discussions with Verenium management and its advisors, that the Offer Price is more favorable to the stockholders of Verenium than the potential value that might have resulted from other strategic opportunities potentially available to Verenium, including remaining an independent public company or selling some or all of its commercial or pipeline products;



•

the belief of our Board of Directors that as a result of arm's-length negotiations with BASF and Purchaser, Verenium and its representatives had negotiated the highest price per Share that BASF was willing to pay for Verenium and that the terms of the Merger Agreement include the most favorable terms to Verenium in the aggregate to which BASF and Purchaser were willing to agree;

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•

the belief of our Board of Directors that Verenium had engaged in a process designed to obtain the best value reasonably available for the stockholders and created an opportunity for other potentially interested parties to negotiate a transaction with Verenium if such parties were interested in a strategic transaction;



•

our Board of Directors' assessment that Verenium was unlikely to be able to achieve a higher price per Share than the Offer Price by remaining a standalone public company or selling product assets to fund the ongoing negative cash flow of the company considering the risks and uncertainties in Verenium's business, including, Verenium's dependence on existing and future collaboration partners for revenue and the challenges involved with entering into successful future collaboration for Verenium, Verenium's limited experience and resources in independently developing, manufacturing, marketing, selling, and distributing commercial enzyme products and Verenium's dependence on Fermic as its sole-source manufacturer for most of its commercial enzyme products; the amount of capital that Verenium would need to continue to fund operations until it can achieve cash breakeven and the potential cost of capital, including the substantial dilution of the ownership percentage of existing stockholders that could be required to obtain necessary capital; and the significant execution risks associated with its business plan, including the development, technical and other risks involved with bringing all or any of the product candidates in Verenium's product pipeline and expansion pipeline to commercialization on a profitable and timely basis or at all;



•

the belief of our Board of Directors that delays in collaborations, slower-than expected ramp-up in enzyme sales for oil and gas, and slower than expected market share growth for Fuelzyme ^TM have contributed to increased risk of delayed profitability and positive cash flow from operations, and have resulted in increased likelihood that Verenium will need to raise additional capital within the next 12 to18 months;



•

the expectation that Verenium as a standalone company would need to enter into new product collaborations, and achieve the projected compounded revenue growth rate of 15.6% in its management case in order to fund its operations without the need to raise additional equity to fund its operations and the Board of Directors' assessment that given the execution risks of the business, additional equity capital raising would likely be required that is not reflected in either the original projections or in the management case projections and such capital could not be available or could be available on highly unfavorable terms and could result in a decline in Verenium's Share trading price from the level prior to the announcement of the Offer;



•

the opinion of UBS Securities LLC ("UBS"), dated September 19, 2013, to the Board of Directors as to the fairness, from a financial point of view and as of the date of the opinion, of the Offer Price to be received in the Transaction by holders of Common Stock, as more fully described below under the caption "—Opinion of Verenium's Financial Advisor."



•

the fact that the Offer is structured as a tender offer, which can be completed, and the cash consideration can be delivered to Verenium's stockholders, on a prompt basis, reducing the period of uncertainty during the pendency of the Transactions on stockholders and employees, with a second-step merger to be completed shortly after the acceptance of the Offer in which stockholders who do not tender their Shares in the Offer will receive the same cash price payable for the Shares in the Offer;



•

the fact that the Purchaser must, at the election of Verenium, extend the Offer for one or more periods until March 18, 2014, if any Offer condition has not been satisfied, or, to the extent permitted by the Merger Agreement, waived; provided, that Verenium can only require two such extensions if the Offer condition that has not been satisfied is the Minimum Condition;

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•

the terms and conditions of the Merger Agreement, including the following related factors:



•

BASF's ability to fund the Offer Price with cash;



•

the fact that BASF's and Purchaser's obligations under the Merger Agreement, including with respect to the Offer and the Merger, are not subject to any financing conditions and that BASF and Purchaser make representations and warranties in the Merger Agreement about the sufficiency of their financial resources to purchase Shares pursuant to the Offer and to consummate the Merger;



•

the nature of the conditions to BASF's obligations to consummate the Offer and the other Transactions and the risk of non-satisfaction of such conditions;



•

the conclusion of our Board of Directors that the termination fee of $2.1 million and the circumstances when such termination fee may be payable by Verenium are reasonable in light of the benefit of the Offer and the other Transactions;



•

the ability of our Board of Directors under the Merger Agreement to withdraw or modify its recommendation that Verenium's stockholders accept the Offer and tender their Shares in certain circumstances, including in connection with a superior offer, and Verenium's right to terminate the Merger Agreement in order to accept a superior offer and enter into a definitive agreement with respect to such superior offer, in both cases subject to payment of a termination fee and the related ability for any other party to approach Verenium if such party is potentially interested in such a transaction subject to the terms and conditions of the Merger Agreement; and



•

the availability of statutory appraisal rights to Verenium's stockholders who do not tender their shares in the Offer and otherwise comply with all required procedures under the DGCL.

        Our Board of Directors also considered a variety of risks and other potentially negative reasons in determining whether to approve the Merger Agreement and the Transactions, including the following:

•

the fact that Verenium's stockholders will not participate in any potential future benefit from its intellectual property portfolio and future revenue from existing commercial products, pipeline products, expansion of pipeline products, contract manufacturing, and existing and any future collaborations and licenses;



•

the effect of the announcement and pendency of the Merger Agreement and the Offer on Verenium's operations, employees, collaboration partners, suppliers and its ability to retain employees;



•

the fact that our executive officers and members of our Board of Directors may be deemed to have interests in the execution and delivery of the Merger Agreement and all of the Transactions, including the Offer and the Merger, that may be different from or in addition to those of our stockholders, generally;



•

the fact that if the Offer and the other Transactions may not be consummated in a timely manner or at all:



•

the trading price of Shares may be adversely affected;



•

Verenium will have incurred significant transaction and opportunity costs attempting to consummate the Transactions;



•

Verenium may have lost potential collaboration partners and employees after announcement of the Offer;



•

Verenium's business may be subject to significant disruption;

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•

the restrictions in the Merger Agreement on the conduct of Verenium's business prior to the consummation of the Merger, which may delay or prevent Verenium from undertaking business or other opportunities that may arise prior to the consummation of the Offer or the Merger;



•

Verenium's directors, officers and other employees will have expended considerable time and effort to consummate the Transactions;



•

the $2.1 million termination fee payable to Purchaser upon the occurrence of certain events, including the potential effect of such termination fee to deter other potential acquirers from publicly making a competing offer for Verenium that might be more advantageous to Verenium's stockholders, and the impact of the termination fee on Verenium's ability to engage in certain other transactions for twelve months from the date of the Merger Agreement is terminated in certain circumstances; and



•

the fact that the gain realized by Verenium's stockholders as a result of the Offer and the Merger generally will be taxable to the stockholders for U.S. federal income tax purposes.

        Our Board of Directors concluded that the risks, uncertainties, restrictions and potentially negative reasons associated with the Offer and Merger were outweighed by the potential benefits of the Offer and Merger.

        The foregoing discussion of our Board of Directors reasons for its recommendation to accept the Offer is not meant to be exhaustive, but addresses the material information and reasons considered by our Board of Directors in connection with its recommendation. In view of the wide variety of reasons considered by our Board of Directors in connection with the evaluation of the Offer and the complexity of these matters, our Board of Directors did not find it practicable to, and did not, quantify or otherwise assign relative weights to the specific reasons considered in reaching its determination and recommendation. Rather, the directors made their determinations and recommendations based on the totality of the information presented to them, and the judgments of individual members of our Board of Directors may have been influenced to a greater or lesser degree by different factors. In arriving at their respective recommendations, the members of our Board of Directors considered the interests of our executive officers and directors as described under "Past Contacts, Transactions, Negotiations and Agreements" in Item 3 above.

(iii)

Certain Financial Projections

        Verenium does not, as a matter of course, publicly disclose forecasts or internal projections as to future performance or results of operations due to the inherent unpredictability of the underlying assumptions and projections. During the first quarter of 2013, our management prepared financial projections reflecting Verenium as a standalone company, and assuming we were able to complete the collaboration with BASF that was then being negotiated with BASF. In May 2013, we provided these original projections to our Board of Directors, and to UBS, in connection with our Board of Directors' review of potential strategic alternatives. We also provided these original projections to potential buyers, including Parent and Purchaser.

        Subsequently, in September 2013, our management updated these financial projections to reflect updated risk assessments relating to some of the key assumptions underlying the original financial projections. We provided the updated management case projections to our Board of Directors and to UBS in connection with our Board of Directors' review of potential strategic alternatives. Following its review of the updated management case projections, our Board of Directors directed UBS to rely on the updated management case projections for use in connection with their financial analyses and opinion. We did not provide the updated financial projections to any potential buyers.

        The information set forth below is included solely to give Verenium stockholders access to certain financial projections that were made available to our Board of Directors and advisors and is not

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included in this Schedule 14D-9 in order to influence any stockholder's decision to tender Shares in the Offer or any other purpose.

        The financial projections were not prepared with a view toward public disclosure, or with a view toward compliance with published guidelines of the SEC, the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of financial forecasts, or United States generally accepted accounting principles ("GAAP"). Neither our independent registered public accounting firm, nor any other independent accountants, have compiled, examined or performed any procedures with respect to the prospective financial information included below, or expressed any opinion or any other form of assurance on such information or its achievability.

        The preparation of the financial projections reflect core elements of our strategy, including:

•

Growing Our Commercial Product Sales:   We currently sell our commercial products primarily across four product lines: animal health & nutrition, grain processing, oilfield services and other industrial processes. While we expect to see a decline in sales from our current commercial product portfolio for animal health and nutrition due to the introduction of next-generation products, we expect sales to grow for our existing commercial products in grain processing and oilfield services through a combination of new customer adoption and/or increased sales volumes to existing customers.



•

Optimizing Our Product Manufacturing:   We expect to improve the productivity of our enzyme manufacturing capabilities, to lower our costs and/or increase our product volumes through implementing manufacturing process improvements, as well as making targeted capital investments in manufacturing equipment and processes together with Fermic, in Mexico.



•

Commercializing Our Product Pipeline:   Our product pipeline currently consists of seven mid- to late-stage product candidates targeted at the core markets we currently serve. We intend to advance these product candidates from our pipeline through the processes required for commercialization, such as development and regulatory approval, and expect to commercialize these new enzyme products in various times between now and 2016.



•

Developing Our Expansion Pipeline Through Partnerships:   We expect to enter into new collaborations with other companies to support the development and/or commercialization of new enzyme products from our Expansion Pipeline which we define as early to mid-stage product candidates that have the potential to target markets we serve today and existing or future markets that we have not historically addressed,, such as baking, sweeteners, personal care and detergents, and potentially to target other emerging markets like bio-based chemicals and next-generation biofuels. We evaluate partnering opportunities by considering the potential benefits the partner may bring, including: (i) providing market insights into customers' desired performance characteristics, (ii) accelerating estimated time-to-market, (iii) providing a sales and marketing channel to reach a target market and (iv) sharing in the expenses associated with developing a product.

        The financial projections estimate total revenue from our Commercial Products, Pipeline Products, Expansion Pipeline Products, contract manufacturing, collaboration revenue and licenses. The financial projections estimate EBIT (calculated as total revenue minus cost of goods sold, research and development, general and administrative expenses, sales and marketing expenses, depreciation, stock based compensation and restructuring expenses) and EBITDA (calculated as EBIT plus depreciation and stock compensation). The financial projections of Verenium as a standalone company include estimates of EBITDA, adjusted EBITDA (calculated as EBITDA plus cash lease payments) and unlevered free cash flow that are not GAAP financial measures.

        The financial projections reflect numerous estimates and assumptions made by management with respect to general business, economic, competitive, regulatory, market and financial conditions and

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other future events, as well as matters specific to Verenium's business, all of which are difficult to predict and many of which are beyond our control, such as:

•

our estimates regarding market sizes and opportunities, as well as our future revenue, product and contract manufacturing revenue, profitability and capital requirements;



•

our limited capital resources as compared to our main competitors in most of our target markets; our ability to increase or maintain our product revenue and improve or maintain product gross margins;



•

the timing and amount of expected revenue from our Product Pipeline;



•

our ability to secure partnerships for, and advance products from, our Expansion Pipeline;



•

our strategy;



•

our ability to improve manufacturing processes, reduce inventory losses and increase manufacturing yields in order to improve margins and enable us to continue to manage capacity in response to market conditions, such as the state of the corn ethanol industry;



•

our ability to maintain good relationships with the companies with whom we contract for the manufacture of certain of our products;



•

our expected future research and development expenses, sales and marketing expenses, and general and administrative expenses;



•

our plans regarding future research, product development, business development, commercialization, growth, independent project development, collaboration, licensing, intellectual property, regulatory and financing activities; and



•

our ability to refinance the notes payable to Athyrium Capital.

        Set forth below is a list of major assumptions used to derive the financial projections for the management case.

•

Total revenue of $61.9 million in 2013, growing to $351.3 million in 2025, for a compounded annual growth rate, or CAGR, of 15.6%;



•

Peak market share estimates by product line, based upon our estimate of addressable markets for individual products within each product line, as follows:

The peak market share for Personal Care is for a products expected to be developed for a single customer and captive market, in which case the market share is assumed to be 100%.

•

Product gross profit of $19.8 million in 2013, growing to $129.3 million in 2025, for a CAGR of 17%;



•

Operating expenses of $39.0 million in 2013, growing to $60.9 million in 2025, for a CAGR of 3.8%;



•

Capital expenditures of $6 million to $7 million in 2013-2014 for manufacturing optimization and expansion projects at our single manufacturing site, Fermic; annual capital expenditures growing

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from $2.3 million in 2015 to $6.8 million in 2025; capital expenditures for second manufacturing site, if necessary, not included in financial projections;

•

Comerica Bank credit line will be fully drawn and remain available through 2025;



•

Notes payable to Athyrium Capital will be refinanced and extended beyond current maturity in December 2017;



•

No equity offerings or other capital raising activities; and



•

A cash tax rate of 40%.

        Management prepared the updated management case projections based upon a risk assessment of our ability to achieve the projected revenue for each product line in the original projections, as follows:

•

100% achievement of original revenue projections for existing Commercial Products where Verenium has run rate revenues and strong existing market presence with high level of confidence that projections will be met;



•

90% achievement of original revenue projections for Commercial Products with existing commercial sales and a current competitive market position;



•

75% achievement of original revenue projections for Commercial Products with little or no existing market share or partnered Pipeline and Expansion Pipeline Products with pending development and commercial launch; and



•

50% achievement of original revenue projections for Pipeline and Expansion Pipeline Products at an early stage of development or that have not yet been partnered.

        These risk adjustments are based upon our own subjective view of the likelihood of the following:

•

The risks in achieving revenue projections given flat revenue levels during the past 5 years;



•

Our dependence on third party partners to commercialize, market, distribute or sell certain of our products;



•

Delays we have experienced in entering into collaboration agreements for new products and the impact of delays on expected commercial launches and related revenue;



•

The significant compounded annual growth rate for revenue predicted in the original projections; and



•

Other risks and uncertainties in the model.

        These risk adjustments are not scientific and may not accurately reflect future revenue from these product segments. No adjustments were made to assumed collaboration and licensing revenue and no adjustments were made to assumed expenses, or assumptions around equity or debt capital.

        The financial projections reflect subjective judgment in many respects and, therefore, are susceptible to multiple interpretations and periodic revisions based on actual experience and business developments. The inclusion of the financial projections should not be regarded as an indication that we or anyone who received the projections then considered, or now considers, the projections to be necessarily predictive of actual future events, and this information should not be relied upon as such. Management views the financial projections as being subject to inherent risks and uncertainties associated with such long-range projections. We do not intend to, and disclaim any obligation to, update, revise or correct the projections if any of it is or becomes inaccurate (even in the short term).

        The financial projections should be evaluated, if at all, in conjunction with the historical financial statements and other information regarding Verenium in our public filings with the SEC. The financial projections do not take into account any circumstances or events occurring after the date they were prepared. Further, the financial projections do not take into account the effect of any failure of the

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Offer or the Merger to be consummated and should not be viewed as accurate or continuing in that context. Stockholders are cautioned not to place undue, if any, reliance on the financial projections included in this Schedule 14D-9.