Related Party Transactions and Outside Related Director Information

Nuvelo, Inc. (NUVO)

4/14/2006 Proxy Information

Dr. Rathmann, a member of the Company’s board of directors and chairman emeritus, provided a $20.0 million line of credit to the Company in August 2001, of which $11.0 million has been drawn down, with the remaining $9.0 million having expired unused. The related promissory note bears interest at the prime rate plus 1%. In November 2003, the Company began repaying the outstanding balance over 48 months with equal monthly principal payments of $0.2 million. Accrued interest will be paid with the final payment in October 2007, unless both are repaid before then. As of December 31, 2005, the remaining principal and accrued interest totaled $6.9 million, and the interest rate on the note on this date was 8.25%. The outstanding principal and interest under the note may be repaid at any time upon mutual agreement, by conversion into shares of the Company’s common stock at a price based upon the average price of Nuvelo’s common stock over a 20-day period ending 2 days prior to the conversion or, if in connection with an equity financing, at the offering price. As of December 31, 2005, 818,347 shares would be issuable upon conversion of the full amount of the principal and interest outstanding on the note. The personal guarantee that Dr. Rathmann had provided to The Irvine Company, related to the 985 Almanor Avenue facility lease, was terminated during 2005.

Dr. Rathmann has served as Chairman Emeritus of Nuvelo, Inc. since September 2005, where he served as Chairman from February 2000 until September 2005. He served as Chief Executive Officer of Nuvelo from May 2000 to March 2001 and as President from May 2000 to January 2001.