Abraxis BioScience (ABII)

Restricted Stock

At December 31, 2008, 248,631 restricted stock units were outstanding under our 2007 and 2001 Stock Incentive Plan with a weighted average per share market value of $61.28 and with vesting dates ranging from March 2009 to March 2012. Upon vesting, each restricted stock unit entitles the holder to one share of our common stock. Compensation expense related to restricted stock unit grants is based upon the market price on the date of grant and is charged to earnings on a graded amortization basis over the applicable vesting period. Restricted stock units currently granted generally vest ratably over a four year period.

Stock-based compensation costs for all RSU awards (including liability awards) for the years ended December 31, 2008, 2007 and 2006 were $8.1 million, $17.2 million and $19.2 million, respectively. As of December 31, 2008, there was $13.6 million of total unrecognized compensation expense related to restricted stocks granted under our stock-based compensation plans, which is expected to be recognized over a weighted average period of 1.7 years.

Following is a reconciliation of unvested restricted stock unit awards as of December 31, 2008:

Restricted Stock

At December 31, 2007, 135,072 restricted units were outstanding under our 2001 Stock Incentive Plan with a weighted average per share market value of $50.41 and with vesting dates ranging from March 2008 to March 2011. Upon vesting, each restricted unit entitles the holder to one share of our common stock. Compensation

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expense related to restricted stock grants is based on upon the market price on the date of grant and is charged to earnings on a straight-line basis over the applicable vesting period. Restricted stock units currently granted generally vest ratably over a four year period.

Restricted Stock

Abraxis BioScience has two restricted stock unit plans that New Abraxis employees participate in, RSU Plan I and RSU Plan II (the “Plans”). A total of 3,537,319 shares of Abraxis BioScience common stock are issuable under the Plans. Under the terms of the RSU Plan I, the units granted under this plan vested upon the completion of the 2006 Merger. The shares of common stock issuable upon the vesting of these units reduced the number of shares otherwise issuable to the shareholders of ABI at the effective time of the 2006 Merger under the terms of the 2006 Merger agreement. Under the terms of RSU Plan II, in general one-half of the units granted thereunder will vest on the second anniversary of the 2006 Merger and the remaining one-half of the units will vest on the fourth anniversary of the 2006 Merger. On each vesting date, the value of the restricted stock unit award will convert into the right to receive a number of shares of Abraxis BioScience’s common stock equal to the value of the award divided by the average trading price of Abraxis BioScience’s common stock over the three trading days prior to vesting. In the event that the average trading price of Abraxis BioScience’s common stock for such period is less than $28.27, then the value of the award will be determined by multiplying the average trading price of our common stock over the three trading days prior to vesting by the number of vested units. In the event that the average trading price of our common stock for such period is greater than $28.27, then the value of the award will be computed by multiplying $28.27 by the number of vested units. Abraxis BioScience may elect to pay to the holder the cash value of its common stock that vests on each vesting date in lieu of delivery of Abraxis BioScience common stock. Awards relating to the Plans with a value of $19.1 million were expensed during the year ended December 31, 2006. Awards relating to the Plans are accounted for under the liability method per FAS123(R). As of December 31, 2006, New Abraxis had recorded a current liability of $9.7 million and a long-term liability of $5.9 million for awards relating to the Plans.

The Plans, and the awards thereunder granted to New Abraxis employees, will be assumed by New Abraxis in connection with the separation. After the separation, the restricted stock units will entitle the holders thereof to

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acquire New Abraxis common stock and will be adjusted pursuant to the employee matters agreement using a formula intended to preserve the pre-distribution economic value of the restricted stock units. The New Abraxis restricted stock units will otherwise have the same terms and conditions as the Abraxis BioScience restricted stock units.

On April 18, 2006, Abraxis BioScience entered into an agreement with RSU Plan LLC, or the RSU LLC, an entity that was beneficially owned and controlled by the ABI shareholders existing prior to the 2006 Merger, including entities controlled by Dr. Soon-Shiong. RSU LLC owns a sufficient number of shares of Abraxis BioScience common stock to satisfy Abraxis BioScience’s obligations under the RSU Plan II. Under the terms of this agreement, RSU LLC has agreed that prior to the date on which restricted stock units issued pursuant to the RSU Plan II become vested, RSU LLC will deliver, or cause to be delivered, to Abraxis BioScience the number of shares of Abraxis BioScience’s common stock, or cash, or a combination thereof, in an amount sufficient to satisfy the obligations to participants under the RSU Plan II of the vested restricted units. Abraxis BioScience is required to satisfy its obligations under the RSU Plan II by paying to the participants in the RSU Plan II cash and/or shares of Abraxis BioScience common stock in the same proportion as was delivered to Abraxis BioScience by the RSU LLC. The intention of this agreement is to have RSU LLC satisfy Abraxis BioScience’s obligations under RSU Plan II so that there would not be any further dilution to Abraxis BioScience’s stockholders as a result of its assumption of the RSU Plan II.