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Stockholder Advisory of Exchanged Holders of Genzyme Tissue Repair Common Stock for the Distribution date December 23, 1994

Genzyme Distribution:

Shareholders get .135 Genzyme Tissue Repair (GTR) common stock for every share of Genzyme General (GENZ) common stock, plus $5.0625 for any fractional shares.

Adjustment to GENZ cost basis:

Should be allocated in proportion to fair market values (average hi/lo prices) of GENZ and GTR on the Distribution Date (December 23, 1994).

12/23: GENZ GTR

HI: 29.25 Hi: 5.00

LO: 28.50 Lo: 4.50

AVG: 28.875 4.75

The allocation of the cost basis must be weighed to the shares issued (it is not 1:1). The way to calculate this is to evaluate the total market value of each stock on the distribution date:

For example, if you owned 100 shares for which you paid $10/share, total cost was $1,000.00.

At the distribution, you had:

100 shares at $28.875 = $2,887.50 – 97.8%

13.5 shares at $4.75 = 64.125 – 2.2%

For the GENZ stock, 97.8 percent times $1,000.00 (total original basis) = $978.00, which is the basis for the total number of GENZ shares. $978.00/100 shares = $9.78/share.

For the GTR stock, 2.2 percent times $1,000.00 (total original basis) = $22.00, which is the basis for the total number of GENZ shares. $22.00/13.5 shares = $1.63/share.

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