Exhibit 10.01

EXECUTION COPY

ASSET PURCHASE AGREEMENT

by and between

OSIRIS THERAPEUTICS, INC.

and

NUVASIVE, INC.

Dated as of May 8, 2008

TABLE OF CONTENTS

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ASSET PURCHASE AGREEMENT

This ASSET PURCHASE AGREEMENT (this “ Agreement ”) dated as of the 8th day of May, 2008, is by and between OSIRIS THERAPEUTICS, INC. , a Delaware corporation (“ Seller ”), and NUVASIVE, INC. , a Delaware corporation (“ Purchaser ”).

RECITALS:

A.            Seller is engaged in the business of processing, manufacturing, marketing and selling an osteobiologic allograft material containing cancellous bone (which contains intrinsic viable mesenchymal stem cells) used in spinal fusion and other surgical procedures and commonly known as Osteocel ^® and Osteocel ^® XO including current formulation and all development projects related to Osteocel ^® and Osteocel ^® XO   (collectively, the “ Product ”) (the development, manufacturing, marketing and sale of the Product shall be referred to herein as the “ Business ”).

B.            Pursuant to this Agreement, Seller and Purchaser intend that (i) Seller sell and transfer to Purchaser all of Seller’s right, title and interest in and to all of Seller’s property and assets set forth in Section 1.1(a) hereof, and (ii) Purchaser assume certain specified obligations of Seller, contractual and otherwise, set forth in Section 1.2(a), all on the terms and conditions contained in, and as more fully set forth in, this Agreement.

C.            Simultaneously with the execution and delivery of this Agreement and as a condition and material inducement to the willingness of Purchaser to enter into this Agreement, Purchaser and certain stockholders of Seller are entering into voting agreements pursuant to which, among other things, such stockholders have agreed to vote in favor of approval of the transactions contemplated by this Agreement and the other Transaction Documents and to take certain other actions in furtherance of the transactions contemplated hereby, in each case upon the terms and subject to the conditions set forth herein.

Accordingly, in consideration of the premises and the mutual covenants and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

ARTICLE I.

PURCHASE AND SALE OF ASSETS

Section 1.1            Transferred Assets; Excluded Assets; Time of Transfer.

(a)           Transferred Assets . On the terms and subject to the conditions set forth in this Agreement and in reliance upon the representations and warranties contained herein, at the times set forth in Section 1.1(c) below, Seller shall sell, transfer, assign, set over, convey and deliver to Purchaser, and Purchaser shall purchase, acquire, accept, assume and receive from Seller, free and clear of any Liens (other than Permitted Liens), all right, title and interest of Seller in, to and under the following assets and property, real, personal or mixed, tangible or intangible, of Seller with respect to the Business (other than the Excluded Assets) (the “ Transferred Assets ”):

(i)            All Patent Rights, Trademark Rights and Copyright Rights set forth on Schedule 1.1(a)(i)  hereto (the “ Transferred Technology ”);

(ii)           All inventory (other than Finished Inventory) and work in process existing as of the Manufacturing Closing Date, which includes any and all goods, raw materials and work in process used or consumed in the Business, together with all rights of Seller relating to such inventory against suppliers thereof (the “ Work in Process ”);

(iii)          [Intentionally omitted.] ;

(iv)          The rights of Seller related to the development of the Product, including all clinical trials, and related clinical trial data, which rights are identified on Schedule 1.1(a)(iv)  (the “ Product Development ”);

(v)           All data and records related to the operation of the Business, which data and records include (without limitation) client and customer lists, research and development reports, financial and billing records (including routing and billing information), creative materials, advertising materials, marketing materials, promotional materials, studies, reports, correspondence and other similar documents (the “ Records ”), which Records are identified on Schedule 1.1(a)(v) ; provided that all such data and records provided pursuant to this Section 1.1(a)(v) may in Seller’s sole discretion, have redacted therefrom all data unrelated to the Business;

(vi)          The tangible personal property of Seller used in or necessary for the operation of the Business identified on Schedule 1.1(a)(vi) ;

(vii)         The permits, licenses, franchises, consents, authorizations, registrations and other approvals and operating rights relating to the Business that are identified on Schedule 1.1(a)(vii) ;

(viii)        All claims of Seller against third parties relating to the Technology Assets as of the Technology Closing Date and the Manufacturing Assets as of the Manufacturing Closing Date, in each case whether choate or inchoate, known or unknown, contingent or noncontingent;

(ix)           All rights of Seller relating to deposits and prepaid expenses, claims for refunds and rights to offset in respect thereof relating to the Business and/or the Transferred Assets;

(x)            All rights in and to the Contracts used in, related to or necessary for the operation of the Business as presently conducted or as contemplated to be conducted, that are identified on Schedule 1.1(a)(x)  (the “ Assumed Contracts ”);

(xi)           All of Seller’s goodwill relating to the foregoing assets; and

(xii)          All Business Intellectual Property not otherwise set forth on Schedules 1.1(a)(i), 1.1(a)(iv), 1.1(a)(v) and 1.1(a)(vi).

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Schedule 1.1 — Manufacturing Assets identifies all of the Transferred Assets that are being transferred to Purchaser at the Manufacturing Closing (the “ Manufacturing Assets ”).

(b)           Excluded Assets .  Except for the Transferred Assets, Purchaser shall not acquire by virtue of this Agreement, any other Transaction Document, or the transactions contemplated hereby or thereby, and shall have no right, title or interest in any of the assets of Seller with respect to the Business or otherwise, and such assets shall remain the property of the Seller (collectively, the “ Excluded Assets ”).

(c)           Time for Transfer of the Transferred Assets .  The consummation of the transactions contemplated by this Section 1.1 shall take place (i) with respect to the Technology Assets, on the Technology Closing Date (the “ Technology Asset Transfer ”) and (ii) with respect to the Manufacturing Assets, on the Manufacturing Closing Date (the “ Manufacturing Asset Transfer ”).

Section 1.2            Assumed Liabilities; Retained Liabilities.

(a)           On the terms of and subject to the conditions of this Agreement and in reliance upon the representations and warranties contained herein, in addition to purchasing and acquiring the Transferred Assets, Purchaser shall assume and agrees, from and after the date of such assumption, to pay, perform and discharge when due, and to indemnify Seller against and hold it harmless from only the following liabilities and obligations of Seller (but excluding the Retained Liabilities) in respect of the Business (the “ Assumed Liabilities ”):

(i)            (A) The obligations to perform arising in the ordinary course of the Business after the Technology Closing Date under the Assumed Contracts which constitute a portion of the Technology Assets and (B) the obligations to perform arising in the ordinary course of the Business after the Manufacturing Closing Date under the Assumed Contracts which constitute a portion of the Manufacturing Assets;

(ii)           The expenses and liabilities relating to the Business which are incurred or accrued in the ordinary course of the Business consistent with past practice after the Technology Closing Date.

(b)           Other than the Assumed Liabilities, Purchaser shall not assume by virtue of this Agreement or the transactions contemplated hereby, and shall have no liability for, any other liability of Seller.  All liabilities other than Assumed Liabilities are referred to herein as “ Retained Liabilities .”  The Retained Liabilities will include, without limitation, the following:

(i)            all trade accounts payable of the Business;

(ii)           any liabilities or obligations of Seller in respect of indebtedness (whether absolute, accrued, contingent, fixed or otherwise, whether due or to become due) of Seller, of any kind, character or description whatsoever, including, but not limited to, indebtedness owed by Seller to any of its stockholders;

(iii)          any liabilities or obligations of Seller related to the employment, termination or compensation of any employee, consultant or service provider of the

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Seller, including but not limited to compensation claims, Taxes or employer withholdings, workers’ compensation or benefits (however described) owing to any such person arising out of the operation of the Business by Seller including, for avoidance of doubt, any and all liabilities or obligations to Transferred Employees incurred prior to the time that any such Transferred Employee becomes an employee of Purchaser;

(iv)          any liabilities or obligations of Seller which arise from or out of or in connection with any product warranty or product liability claims owing, accrued or the underlying facts with respect to which arising out of the operation of the Business by Seller (including, for avoidance of doubt, the operation of the Business by Seller through and including the Manufacturing Closing Date but excluding liabilities or obligations resulting from either modifications to the Product made by Purchaser or additional warranties extended by Purchaser following the Technology Closing Date);

(v)           any liabilities or obligations (whether assessed or unassessed) of Seller for any Taxes, any Transfer Taxes imposed on Seller, any Taxes of the Business for any period (or portion thereof) ending on or prior to the Technology Closing Date and any Taxes of the Business related to the Manufacturing Assets for any period (or portion thereof) ending on or prior to the Manufacturing Closing Date;

(vi)          any liabilities or obligations relating to or arising out of a breach or failure of Seller to perform under an Assumed Contract prior to the date on which any such Assumed Contract is transferred by Seller to Purchaser in accordance with the terms of this Agreement;

(vii)         any liabilities or obligations relating to or arising under any environmental law or regulation to the extent arising out of the operation of the Business prior to the Technology Closing Date with respect to the Technology Asset and the Manufacturing Closing Date with respect to the Manufacturing Assets; and

(viii)        any liabilities or obligations of Seller incurred, arising from or out of or in connection with this Agreement, the Manufacturing Agreement, the License Agreement, the Bill of Sale — Technology Assets, the Bill of Sale — Manufacturing Assets, the IP Assignment Agreement — Patents and the IP Assignment Agreement — Trademarks (together, the “ Transaction Documents ”) or the events or negotiations leading up to the execution and consummation of the transactions contemplated by the Transaction Documents.

Section 1.3            Technology Closing; Manufacturing Closing .  The consummation of the Technology Asset Transfer (the “ Technology Closing ”) shall be held as soon as reasonably practicable upon satisfaction of the conditions set forth in Article V of this Agreement or such other date and time as Purchaser and Seller shall agree (the “ Technology Closing Date ”).  The consummation of the Manufacturing Asset Transfer (the “ Manufacturing Closing ”) shall be held as soon as reasonably practicable following the earlier to occur of (i) the termination of the Manufacturing Agreement by Purchaser pursuant to Section 7.1 of the Manufacturing Agreement and (ii) the expiration of the “Term” (as that term is defined in the Manufacturing Agreement) of the Manufacturing Agreement (the “ Manufacturing Closing Date ”).  The Technology Closing

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and the Manufacturing Closing shall be held at the offices of DLA Piper US LLP, 4365 Executive Drive, San Diego, California (or via exchange of documents via PDF and overnight mail courier).

Section 1.4            Initial Purchase Price .  At the Technology Closing, Purchaser shall (i) assume the Assumed Liabilities related to the Technology Assets, and (ii) pay to Seller an aggregate of Thirty Five Million Dollars ($35,000,000) (the “ Initial Purchase Price ”).  Purchaser shall pay the Initial Purchase Price to Seller by bank or cashiers check or, provided that Seller has delivered wire transfer instructions to Purchaser not less than two (2) business days prior to the Technology Closing Date, by wire transfer in United States dollars of immediately available funds to an account designated in writing by Seller.

Section 1.5            Additional Purchase Price.

(a)           Milestones; Milestone Payments .  From and after the Technology Closing Date, in addition to the consideration set forth in Section 1.4 above, Purchaser shall, subject to, and contingent upon achievement of the post-Technology Closing performance milestones of the Business set forth below (each, a “ Milestone ”) not later than the applicable date for satisfaction of each Milestone set forth below (each a “ Milestone Expiration Date ”), pay to Seller an amount of cash (in United States dollars of immediately available funds) or common stock, par value $0.001 per share, of Purchaser (“ Purchaser Common Stock ”) (the form of payment of which is to be determined in the sole discretion of Purchaser), equal to the First Milestone Payment, Second Milestone Payment, Third Milestone Payment, Fourth Milestone Payment, Fifth Milestone Payment and/or Sixth Milestone Payment, as applicable (the “ Applicable Milestone Payment ”) and each Milestone shall be independent of each other Milestone and may be satisfied and payment become due therefore regardless of non-satisfaction of any other Milestone; provided , however , that (i) Purchaser shall not issue shares of Purchaser Common Stock in respect of any Applicable Milestone Payment unless such shares of Purchaser Common Stock may be re-sold by Seller pursuant to Rule 144 of the rules and regulations promulgated under the Securities Act of 1933, as amended (the “ Securities Act ”) on the date of such issuance, (ii) if Purchaser elects to issue shares of Purchaser Common Stock in respect of any Applicable Milestone Payment, then prior to such issuance and upon request by the Purchaser, Seller shall deliver to Purchaser such representations and warranties as Purchaser shall reasonably request for purposes of exempting the issuance of such shares from the registration requirements of the Securities Act and (iii) if Purchaser elects to issue shares of Purchaser Common Stock in respect of any Applicable Milestone Payment, the number of shares of Purchaser Common Stock to be issued shall be equal to the Applicable Milestone Payment divided by the Purchaser Common Stock Value.  The obligations of Purchaser under this Section 1.5(a) are subject to the provisions of Section 1.5(c) below (regarding Purchaser’s Rights of Set-Off).  For avoidance of doubt, in no event shall the sum of all Applicable Milestone Payments made by Purchaser to Seller under this Section 1.5 exceed Fifty Million Dollars ($50,000,000) plus or minus the WIP Value (the “ Maximum Milestone Amount ”).

(i)            If at any time following the Technology Closing Date but at or prior to April 15, 2009, Seller shall have delivered to Purchaser an aggregate of 125,000 cubic centimeters of Product (the “ First Delivery Threshold ”) in accordance with the terms and provisions of, and subject to the specifications set forth in, the Manufacturing Agreement,

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Purchaser shall pay to Seller Five Million Dollars ($5,000,000) (the “ First Milestone Payment ”).

(ii)           If at any time following the Technology Closing Date but prior to the Manufacturing Closing, Seller shall have delivered to Purchaser an aggregate of 250,000 cubic centimeters of Product (including, for avoidance of doubt, any Product delivered in satisfaction of the First Delivery Threshold) (the “ Second Delivery Threshold ”) in accordance with the terms and provisions of, and subject to the specifications set forth in, the Manufacturing Agreement, Purchaser shall pay to Seller Five Million Dollars ($5,000,000) (the “ Second Milestone Payment ”).

(iii)          Subject to the prior satisfaction of the conditions set forth in Article VI of this Agreement, at the Manufacturing Closing, Purchaser shall pay to Seller the sum of (i) Twelve Million, Five Hundred Thousand Dollars ($12,500,000) plus or minus (ii) the WIP Value (the “ Third Milestone Payment ”).

(iv)          If prior to the Manufacturing Closing, Seller shall have delivered to Purchaser an aggregate of 275,000 cubic centimeters of Product (including, for avoidance of doubt, the Product delivered pursuant to the Second Delivery Threshold) in accordance with the terms and provisions of, and subject to the specifications set forth in, the Manufacturing Agreement, at the Manufacturing Closing, Purchaser shall pay to Seller Five Million Dollars ($5,000,000) (the “ Fourth Milestone Payment ”).

(v)           At the Manufacturing Closing, Purchaser shall pay to Seller the Additional Product Delivery Payment, if any (the “ Fifth Milestone Payment ”).

(vi)          If at any time following the Technology Closing Date the Business shall generate Thirty-Five Million Dollars ($35,000,000) in cumulative Net Sales (the “ Net Sales Threshold ”), Purchaser shall pay to Seller Fifteen Million Dollars ($15,000,000) (the “ Sixth Milestone Payment ”).

If any payment under this Section 1.5(a) is made in the form of Purchaser Common Stock, then on the date of such payment Purchaser shall provide to Seller (I) a certificate from a duly authorized officer of Purchaser certifying that as of the date of such issuance (x) the Purchaser Common Stock so issued has been duly authorized and is validly issued, fully-paid and non-assessable and, (y) the provisions of Rule 144(c) of the Securities Act, are satisfied and (II) a legal opinion from Purchaser’s legal counsel that such Purchaser Common Stock has been duly authorized and validly issued, is fully paid and non-assessable and that the holding period set forth in Rule 144(b) of the Securities Act has been satisfied.  If Purchaser is unable to satisfy the requirement set forth in the immediately preceding sentence, Seller shall be under no obligation to accept Purchaser Common Stock as payment for the Applicable Milestone Payment and Purchaser shall make such Applicable Milestone Payment in the form of cash, in United States dollars of immediately available funds.

(b)           Time for Determination; Dispute Mechanism .

(i)            As soon as reasonably practicable following each date on which a Milestone is achieved and in any event within five (5) business days of the achievement

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of any such Milestone, Purchaser shall pay to Seller the Applicable Milestone Payment for such Milestone; provided , however , that in no event shall Purchaser be liable for the payment of, and Seller shall not be entitled to, any Applicable Milestone Payment for any Milestone that is not achieved on or before the applicable Milestone Expiration Date.  At all times following the Manufacturing Closing Date and prior to payment by Purchaser to Seller of the Sixth Milestone Payment pursuant to Section 1.5(a)(vi) hereof, Purchaser shall, as soon as reasonably practicable following each December 31 during such period, deliver to Seller Purchaser’s calculation of the cumulative Net Sales for the period commencing on the day immediately following the Manufacturing Closing Date and up to and including each such December 31.

(ii)           If Seller believes that it is entitled to payment of all or any portion of an Applicable Milestone Payment hereunder which Seller has not received within five (5) business days following the achievement of the Milestone for which payment is due, Seller may, not later than twelve (12) months following the achievement of such Milestone, deliver to Purchaser a notice setting forth Seller’s determination that all or a portion of such Applicable Milestone Payment is due under this Agreement (the “ Milestone Assessment Notice ”).  If Seller does not deliver to Purchaser a Milestone Assessment Notice within such twelve (12) month period, then Seller shall have been deemed to agree that the Milestone has not been met and no payment with respect to such Milestone is due to Seller hereunder and Seller shall have no further rights to such Applicable Milestone Payment or any portion thereof; provided , however , that Seller’s failure to deliver a Milestone Assessment Notice within such twelve (12) month period with respect to the Sixth Milestone Payment shall not relieve Purchaser of its obligations to pay the Sixth Milestone Payment (if and when earned) unless Purchaser is materially prejudiced by such delay.

(iii)          If Purchaser shall object to Seller’s determination that a Milestone has been achieved as set forth in the Milestone Assessment Notice, then Purchaser shall deliver a dispute notice (a “ Milestone Dispute Notice ”) to Seller within five (5) business days following Seller’s delivery of the Milestone Assessment Notice.  If Purchaser delivers a Milestone Dispute Notice to Seller in connection with the Sixth Milestone Payment under Section 1.5(a)(vi), upon Seller’s reasonable request, Purchaser shall provide Seller with such books of account and records and written evidence as Seller shall reasonably request showing Purchaser’s calculation of the Net Sales of the Business and, upon Seller’s reasonable request and upon two (2) business days prior written notice to Purchaser, Seller or its representative may inspect the gross receipts, credits, sales Tax, Tax reports, costs and any other reports, records or documents reasonably requested by Seller and associated with the Business or the Product for the sole purpose of reviewing, and only to the extent necessary to review, Purchaser’s calculation of Net Sales.  A representative of Purchaser, on the one hand, and a representative of Seller, on the other, shall attempt in good faith to resolve any such objections within ten (10) business days of the receipt by Seller of the Milestone Dispute Notice.

(iv)          If Purchaser and Seller shall be unable to resolve any such dispute within the ten (10) business day period, either Purchaser or Seller by written notice to the other may demand arbitration in accordance with the procedures set forth in Section 9.1 hereof.

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(v)           If no Milestone Dispute Notice is delivered within the timeframe set forth above, then Seller’s determination that the Milestone has been achieved, and that some or all of the Applicable Milestone Payment is due hereunder, shall be deemed to be accepted and Purchaser shall pay to Seller those amounts set forth in the Milestone Assessment Notice.

(c)           Rights of Set-Off .  Purchaser shall have the right to withhold and set-off against any amount otherwise due to be paid (but not yet paid) pursuant to this Section 1.5 the amount of any Losses to which any Purchaser Indemnified Party may be entitled under Article VIII hereof or any other agreement entered into pursuant to this Agreement (the “ Rights of Set-Off ”); provided , however , that the foregoing shall not apply (i) to the same Loss more than once or (ii) to the extent any such Loss is adjusted as provided for in Section 8.4(b) hereof.

(d)           Acknowledgement of Seller and Purchaser .  Seller and Purchaser acknowledge  that (i) (A) upon the Technology Closing and subject to Purchaser’s express obligations under the Manufacturing Agreement, Purchaser has the right to operate the Business and Purchaser’s other businesses in any way that Purchaser deems appropriate in Purchaser’s sole discretion, and (B) subject to Purchaser’s express obligations under the Manufacturing Agreement, Purchaser has no obligation to operate the Business in order to achieve any Milestone or to achieve or maximize any Applicable Milestone Payment, (ii) there is no assurance that the Seller will achieve all or any Milestones or that Purchaser will achieve the Net Sales Threshold, (iii) the parties solely intend the express provisions of this Agreement and the other Transaction Documents to govern their contractual relationship, (iv) the right of the Seller to payment of any Applicable Milestone Payment, if any, shall not bear any interest unless not timely paid, and (v) the right of the Seller to a portion of any Applicable Milestone Payment, if any, shall not be represented by a certificate or other instrument, shall not represent an ownership interest of Seller in Purchaser or the Business and shall not entitle Seller to any rights common to any holder of any debt or equity security of Purchaser.  The Seller hereby waives, on its behalf and on behalf of any of its successors and assigns, any fiduciary duty (but, for avoidance of doubt, not any implied covenant of good faith and fair dealing) of Purchaser to Seller, with respect to the matters contemplated by this Section 1.5.

Section 1.6            Withholding .  Purchaser shall be entitled to deduct and withhold from the consideration otherwise payable pursuant to this Agreement to Seller  such amounts as Purchaser is required to deduct and withhold under the Code, or any provisions of state or local Tax law, with respect to the making of such payment.  Purchaser shall notify Seller of the basis for such withholding no less than 10 business days prior to the proposed withholding and shall consider in good faith any views of Seller that such withholding is not required under the Code, or any provisions of state or local Tax law, with respect to the making of such payment.

Section 1.7            Allocation of Purchase Price .  The Initial Purchase Price shall be allocated for Tax purposes among the Transferred Assets in accordance with Section 1060 of the Code.  Purchaser shall prepare and deliver to Seller for Seller’s approval, a proposed allocation of the Initial Purchase Price prepared in accordance with the foregoing within 45 days of the Technology Closing; provided , that if Seller withholds its approval to such allocation, Purchaser and Seller shall negotiate in good faith to agree upon the allocation of the Purchase Price within 30 days of Seller’s receipt of Purchaser’s proposed allocation.  Each of Purchaser and Seller shall

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file IRS Form 8594 with its Federal income Tax Return consistent with such allocation as determined in accordance with the immediately preceding sentence for the Tax year in which this Agreement is consummated.  Seller and Purchaser shall report all Tax consequences of the transactions contemplated by this Agreement in a manner consistent with such allocation, and not take any position inconsistent therewith upon examination of any Tax Return, in any refund claim, in any litigation or investigation or otherwise.

ARTICLE II.

REPRESENTATIONS AND WARRANTIES OF SELLER

Seller represents and warrants to Purchaser as of the date hereof as follows:

Section 2.1            Organization, Good Standing and Authority .  Seller is duly formed, validly existing and in good standing under the laws of the State of Delaware, and is duly qualified as a foreign corporation to transact business and is in good standing in each jurisdiction in which such qualification is required, except where failure to be qualified or to be in good standing would not materially and adversely affect the Business.  Seller has full corporate power and authority to own the assets owned by it, to lease the properties and assets held by it under lease, to own and carry on the operation of the Business as it is now being conducted by it, and to operate the Business as heretofore operated by it.

Section 2.2            Organizational and Governing Documents; Approval.

(a)           Prior to the date hereof, Seller has furnished to Purchaser complete and correct copies of the certificate of incorporation and bylaws of Seller (the “ Seller Organizational Documents ”).  The Seller Organizational Documents are in full force and effect and Seller is not in violation of any provision of the Seller Organizational Documents.

(b)           This Agreement and the other Transaction Documents to which it is a party have been approved by all necessary corporate action of Seller and no other corporate proceedings on the part of Seller and, except for the Stockholder Approval, no corporate proceedings on the part of Seller’s stockholders are necessary to authorize the execution and delivery of this Agreement or any other Transaction Document, or the consummation of the transactions contemplated hereby or thereby, under the Delaware General Corporation Law, the Seller Organizational Documents or otherwise.

Section 2.3            Due Execution and Delivery .  Seller has all necessary power and authority to execute and deliver this Agreement and the other Transaction Documents to which it is a party and each instrument required hereby and thereby to be executed and delivered by it, and, prior to the Technology Closing, will have all necessary power and authority to carry out its obligations hereunder and thereunder.  Seller has duly executed and delivered this Agreement and assuming the due authorization, execution and deliver of this Agreement by Purchaser, this Agreement constitutes (and, when executed and delivered, the Transaction Documents to which it is a party will constitute) the legal, valid and binding obligations of Seller enforceable against it in accordance with its terms, except that such enforcement (a) may be limited by bankruptcy, insolvency, moratorium or similar laws affecting creditors’ rights generally, and (b) is subject to

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the availability of equitable remedies, as determined in the discretion of the court before which such a proceeding may be brought.

Section 2.4            Title and Sufficiency of Transferred Assets .  Seller is the sole owner and has good and marketable title (or leasehold title, as the case may be) to the Transferred Assets free and clear of all liens, claims, charges, security interests, leases, covenants, options, pledges, rights of others, easements, rights of refusal, reservations, restrictions, encumbrances and other defects in title (collectively, “ Liens ”) except for (i) Liens incurred in the ordinary course of the Business, consistent with past practice, of the type identified on Schedule 2.4(i) , (ii) Liens for Taxes not yet due and payable and (iii) Liens created by the express provisions of the Assumed Contracts (together, the “ Permitted Liens ”) whether imposed by agreement, understanding, law, equity, or otherwise.  The Manufacturing Assets are all assets of Seller used in or related to the processing and manufacturing of the Products .  The Transferred Assets are suitable for the uses to which they are being put or have been put in the ordinary course of the Business and are in good working order.  The Transferred Assets and the Business Intellectual Property of Seller licensed to Purchaser under the License Agreement constitute all of the assets, property, real personal or mixed, tangible or intangible, of Seller used in, held for use in, or necessary for the operation of the Business as presently conducted.

Section 2.5             Consents; No Conflict .   Except as set forth on Schedule 2.5 , n o consent, authorization, permit, waiver or approval of or from, or notice to, any person or any governmental authority is required as a condition to the execution and delivery of this Agreement or the other Transaction Documents by Seller or the consummation of the transactions contemplated by this Agreement and the Transaction Documents by Seller.  Except as set forth on Schedule 2.5 , the execution and delivery of this Agreement and the Transaction Documents and each instrument required hereby to be executed and delivered by Seller and the consummation of the transactions contemplated hereby and thereby by Seller will not give rise to a right of termination of, contravene or constitute a default under, or be an event which with the giving of notice or passage of time or both will become a default under, or give to others any rights of termination or cancellation of, or give rise to a right of acceleration of the performance required by or maturity of, or result in the creation of any Lien, claim, cost, Tax, losses or loss of any rights with respect to the Business or the Transferred Assets pursuant to any of the terms, conditions or provisions of or under any applicable law, the Seller Organizational Documents or under any Assumed Contract.

Section 2.6             Taxes .

(a)           All Tax Returns required to be filed (after giving effect to applicable extensions) by Seller by any law, rule or regulation have been filed with the appropriate governmental authority and all Taxes required to be paid by Seller prior to the Technology Closing Date have been paid in full.  No claim has ever been made in writing or, to Seller’s Knowledge otherwise, by a Tax authority in a jurisdiction where the Seller does not pay Tax or file Tax Returns that it is subject to Taxation by that jurisdiction or required to file returns in that jurisdiction.

(b)           All Taxes owed by Seller or for which Seller may be held liable (whether or not shown on any Tax Return) which were or will be due on or prior to the Technology Closing have been or will be paid in full.  The unpaid Taxes of Seller for periods not included in Tax Returns

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filed or to be filed prior to the Technology Closing does not include any material liability for Taxes attributable to events that are outside of the ordinary course of Seller’s business.

(c)           There are no Liens for Taxes (other than for current Taxes not yet due and payable) on any of the Transferred Assets.

Section 2.7             Financial Information .   Attached hereto as Schedule 2.7 are (i) the unaudited balance sheet, operating income and free cash flows of the Business as of the end of and for the fiscal year ended December 31, 2007 and (ii) the unaudited balance sheet of the Business (the “ Balance Sheet ”) as of March 31, 2008 (the “ Balance Sheet Date ”) and the unaudited operating income and free cash flows of the Business as of March 31, 2008 (together, the “ Financial Information ”).  The Financial Information has been, and if required to be reported by Purchaser under Item 9.01 of Form 8-K and Regulation S-X of the federal securities laws for a business acquisition required to be described in answer to Item 2.01 of Form 8-K the unaudited balance sheet, operating income and free cash flows of the Business as of the end of and for the fiscal year ended December 31, 2006 prior to the Technology Closing Date will be, prepared in accordance with GAAP applied on a consistent basis throughout periods covered thereby, fairly represent in all material respects the financial condition, results of operations and cash flows of the Business as of the respective dates thereof and for the periods referred to therein and are consistent with the books and records of the Business, subject to the absence of footnotes and normal, recurring year-end adjustments.  Seller does not have any indebtedness or other liability or obligation (whether known, unknown, mature, unmatured, absolute or contingent) of the Business, except for (a) liabilities and obligations shown on the Balance Sheet and (b) liabilities and obligations which have arisen since the date of the Balance Sheet in the ordinary course of business and which are not material to the Business, individually or in the aggregate.  All reserves that are set forth in or reflected in the Balance Sheet have been established in accordance with GAAP consistently applied and are reasonably adequate.

Section 2.8             [Intentionally omitted.] .

Section 2.9            Contracts.

(a)           Description of Contracts .  Schedule 1.1(a)(x)  contains a true and complete list of all Contracts to which the Seller is a party and which are used in or are necessary for the operation of the Business or by which any Transferred Assets are bound, true and complete copies of which, together with all amendments, waivers and supplements thereto, have been delivered to Purchaser prior to the date hereof.

(b)           Status of Contracts .  Each Assumed Contract is in full force and effect in accordance with its terms and is a valid and binding obligation of Seller and, to Seller’s Knowledge, each other party thereto, enforceable in accordance with its terms, except that such enforcement (i) may be limited by bankruptcy, insolvency, moratorium or similar laws affecting creditors’ rights generally, and (ii) is subject to the availability of equitable remedies, as determined in the discretion of the court before which such a proceeding may be brought.  Neither Seller , nor to Seller’s Knowledge any other party to any of the Assumed Contracts , is in default under any Assumed Contract and no event has occurred which, after notice or lapse of time or both, would constitute a default under any such Assumed Contract, and the

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consummation of the transactions contemplated by this Agreement and the other Transaction Documents will not give rise to any such default or breach.  Each Assumed Contract is in written form.

(c)           Disposition of Certain Contracts .  Seller is legally entitled to terminate those Contracts identified on Schedule 2.9(c)  in accordance with their terms and without penalty or additional payment, effective no later than the date set forth beside the names thereof on Schedule 2.9(c) .

Section 2.10         Litigation and Claims .  There is (a) no A ction pending, or to the Seller’s Knowledge, threatened against or affecting the Business (including any of the Transferred Assets) or the transactions contemplated hereby, or (b) to Seller’s Knowledge, no governmental inquiry or investigation pending or threatened against or affecting the Business (including any of the Transferred Assets).  The Seller has not received any written legal opinion or written memorandum or legal advice from legal counsel to the effect that Seller (with respect to the Business or the Transferred Assets) is exposed, from a legal standpoint, to any material liability or material disadvantage with respect to the Business or the prospects, financial condition, operations, property or affairs of the Business.  The Seller is not in default with respect to any order, writ, injunction or decree of any governmental entity known to or served upon the Seller and relating to the Business or the Transferred Assets.  There is no action or suit by the Seller and relating to the Business or the Transferred Assets that is pending, threatened or contemplated against any other person.

Section 2.11          Compliance With Laws .    Seller is not in material violation of or in material default under any law, statute, regulation, rule, ordinance, administrative order or court order applicable to Seller with respect to the Business or the Transferred Assets, including, without limitation, the Public Health Services Act (“ PHSA ”) and relevant sections of the FDCA , and the United States National Organ Transplant Act, Title 21 of the Code of Federal Regulations Part 1271, Human Cells, Tissues, and Cellular and Tissue Based Products.  To Seller’s Knowledge, the Seller is not under investigation with respect to, has not been threatened to be charged with, nor has been given notice of, any violation of or material default under any law, statute, regulation, rule, ordinance, standard, guideline, administrative order or court order applicable to Seller with respect to the Business or the Transferred Assets.  All permits (A) pursuant to which Seller currently operates or holds any interest in the property of the Business, or (B) which is required for the operation of the Business as currently conducted or the holding of any such interest has been issued or granted to Seller and are set forth on Schedule 2.11 . All such permits are in full force and effect and constitute all permits required to permit the Seller to operate or conduct the Business or hold any interest in the Transferred Assets.

Section 2.12          Employees and Independent Contractors .

(a)           Schedule 2.12(a)(i)  contains a true and complete list, as of April 28, 2008, of all employees of Seller employed in the Business (the “ Seller Employees ”), including, to the extent applicable, each Seller Employee’s (i) name, (ii) title, wage, salary, target bonus and accrued vacation or paid time off as of April 30, 2008, (iii) principal location of employment, and (iv) date of hire by Seller.  Schedule 2.12(a)(ii)  contains a list of all Seller Employees who to Seller’s Knowledge are not citizens of the United States. Schedule 2.12(a)(iii)  also contains a true and

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complete list of all Seller Employees who are as of such date on a short- or long-term disability leave or other leave of absence (but not including vacation).  Each Seller option plan provides that the vesting of all options to purchase Seller common stock, par value $0.001 per share (“ Seller Options ”) granted thereunder to any Seller Employee may be accelerated, in whole or in part, at the discretion of the board of directors of Seller or the plan administrator of the Seller, in either case pursuant to the option plan and related documents governing the Seller Options.

(b)           Schedule 2.12(b)  contains a true and complete list, as of the date hereof, of all consultants and other independent contractors who are providing material services to the Business (the “ Independent Contractors ”), including (i) each Independent Contractor’s name, (ii) the type of services being provided by each Independent Contractor, (iii) the principal location where services are provided by each Independent Contractor and (iv) the date when each Independent Contractor was retained by Seller.  Copies of all contracts relating to Independent Contractors used in the Business have been furnished to Purchaser.

(c)           Seller is in compliance in all material respects with all applicable laws, rules and regulations with respect to employment, employment practices, and terms, conditions and classification of employment (including the proper classification of workers as independent contractors and consultants), wage and hour requirements, immigration status, discrimination in employment, employee health and safety, and the Workers’ Adjustment and Retraining Notification Act.  Seller has withheld or will timely withhold all amounts required by law or by agreement to be withheld from the wages, salaries, and other payments to Seller Employees; and Seller is not liable for any arrears of wages, compensation, Taxes, penalties or other sums for failure to comply with any of the foregoing.  Seller has paid in full or will timely pay in full to all Seller Employees all wages, salaries, commissions, bonuses, benefits and other compensation due to or on behalf of such Seller Employees.  There are no controversies pending or, to Seller’s Knowledge, threatened, between the Seller and any of its Seller Employees, which controversies have or would reasonably be expected to result in an action, suit, proceeding, claim, arbitration or investigation before any governmental entity.

(d)           To Seller’s Knowledge, no Seller Employee is in violation of any term of any employment or service agreement, patent disclosure agreement, non-competition agreement, or any restrictive covenant to a former employer relating to the right of any such Seller Employee to be employed by the Seller because of the nature of the business conducted or presently proposed to be conducted by the Seller or to the use of trade secrets or proprietary information of others.  To Seller’s Knowledge, there are no material controversies, grievances or claims pending or threatened, by any of the Seller Employees with respect to their employment. To Seller’s Knowledge, no Seller Employee has given notice to Seller that any such Seller Employee intends to terminate his or her employment with the Seller (other than for the purposes of accepting employment with Purchaser following the Technology Closing).  The employment of each Seller Employee has been at all times in the past and is “at-will”, and the Seller has not had any obligation to provide any particular form or period of notice prior to terminating the employment of any Seller Employee.  Seller has not (i) entered into any Contract that obligates or purports to obligate Purchaser to make an offer of employment to any Seller Employee and/or (ii) promised or otherwise provided any assurances (contingent or otherwise) to any Seller Employee of any terms or conditions of employment with Purchaser following the Technology Closing.

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Section 2.13         Employee Benefits.

(a)           Schedule 2.13(a)  sets forth a true and complete list of each “employee benefit plan,” as defined in Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended (“ ERISA ”), and each and every written, unwritten, formal or informal plan, agreement, program, policy or other arrangement involving direct or indirect compensation (other than workers’ compensation, unemployment compensation and other government programs), employment, severance, consulting, disability benefits, supplemental unemployment benefits, vacation benefits, retirement benefits, deferred compensation, profit-sharing, bonuses, stock options, stock appreciation rights, other forms of incentive compensation, post-retirement insurance benefits, or other benefits, entered into, maintained or contributed to by Seller or any of its subsidiaries or with respect to which Seller or any of its subsidiaries has or may in the future have any liability (contingent or otherwise), and in each case under which any Seller Employee has any present or future right to benefits.  Each plan, agreement, program, policy or arrangement required to be set forth on such schedule pursuant to the foregoing is referred to herein as a “ Seller Benefit Plan .”

(b)           Each Seller Benefit Plan has been maintained and administered in all respects in compliance with its terms and with the requirements prescribed by any and all statutes, orders, rules and regulations (foreign and domestic), including (without limitation) ERISA and the Code, which are applicable to such Seller Benefit Plan.  No action, suit or claim (excluding claims for benefits incurred in the ordinary course) has been brought or is pending or, to Seller’s Knowledge, threatened against or with respect to any Seller Benefit Plan or the assets or any fiduciary thereof (in that Person’s capacity as a fiduciary of such Seller Benefit Plan).  There are no audits, inquiries or proceedings pending or, to the Knowledge of Seller, threatened by the IRS, DOL, or other governmental entity with respect to any Seller Benefit Plan.  No event has occurred and, to Seller’s Knowledge, there exists no condition or set of conditions in connection with which Purchaser or any Seller Employee could reasonably be expected to become subject to any liability under or with respect to any Seller Benefit Plan.

(c)           No Seller Benefit Plan is maintained outside the jurisdiction of the United States, or covers any Seller Employee residing or working outside the United States.

(d)           Schedule 2.13(d)  discloses each: (i) agreement with any Seller Employee (A) the benefits of which are contingent, or the terms of which are altered, upon the occurrence of a transaction involving Seller of the nature of any of the transactions contemplated by this Agreement, (B) providing any term of employment or compensation guarantee or (C) providing severance benefits or other benefits after the termination of employment of such Seller Employee; (ii) agreement, plan or arrangement under which any Seller Employee may receive payments from Seller that may be subject to the Tax imposed by Section 4999 of the Code or included in the determination of such Seller Employee’s “parachute payment” under Section 280G of the Code; and (iii) agreement or plan binding Seller, including any stock option plan, stock appreciation right plan, restricted stock plan, stock purchase plan, severance benefit plan or Seller Benefit Plan, any of the benefits of which will be increased, or the vesting of the benefits of which will be accelerated, by the occurrence of any of the transactions contemplated by this Agreement or the value of any of the benefits of which will be calculated on the basis of any of the transactions contemplated by this Agreement.

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Section 2.14          Labor Matters.   (i) Seller is not a party to any collective bargaining agreement or other labor contract applicable to any Seller Employee, (ii) to Seller’s Knowledge, no union has bargaining rights with respect to any Seller Employee and there are no threatened or apparent union organizing activities involving any Seller Employee, (iii) there are no strikes, slowdowns or work stoppages pending or, to Seller’s Knowledge, threatened between Seller and an Seller Employee, and (iv) to Seller’s Knowledge, there are no unfair labor practice complaints involving an Seller Employee pending against Seller. Seller shall be responsible for providing continuation coverage to the extent required by Section 4980B of the Code or similar state law (“ COBRA ”) to Seller Employees, and other qualified beneficiaries under COBRA with respect to such employees, who have a COBRA qualifying event (due to termination of employment with the Seller or otherwise) prior to or in connection with the transactions contemplated by this Agreement.  Except as required by law, neither Purchaser nor any of its affiliates shall be responsible for the failure of Seller to comply with any of the requirements of COBRA, including applicable notice requirements.

Section 2.15         Intellectual Property.

(a)           The Transferred Technology set forth on Schedule 1.1(a)(i)  and the other Business Intellectual Property set forth on Schedule 1.1(a)(iv)  together set forth a true, complete and correct list of all Business Intellectual Property.

(b)           The Seller is the sole and exclusive beneficial and record owner of all Transferred Technology.

(c)           The Transferred Technology and the Business Intellectual Property of Seller licensed to Purchaser under the License Agreement (the “ Licensed Technology ”) is valid, existing, in full force and effect, or,  with respect to applications, is still pending, and has not expired or been cancelled or abandoned.  All necessary application, registration, maintenance, renewal and other fees, and all necessary documents and certificates, in connection with such Transferred Technology and the Licensed Technology have been paid and filed, respectively, with the relevant patent, copyright, trademark or other authorities in the United States or foreign jurisdictions, as the case may be, for the purposes of perfecting, prosecuting and maintaining such Transferred Technology and the Licensed Technology.

(d)           There is no pending or, to the Seller’s Knowledge, threatened (and at no time within the two years prior to the date of this Agreement has there been pending any) action, suit, claim or proceeding before any court, government agency or arbitral tribunal in any jurisdiction challenging the use, ownership, validity, enforceability or registerability of any Transferred Technology or the Licensed Technology.  The Seller is not a party to any settlements, covenants not to sue, consents, decrees, stipulations, judgments or orders resulting from action, suit, claim or proceeding which permit third parties to use any Transferred Technology.

(e)           Schedule 2.15(e) lists all licenses, sublicenses and other agreement as to which Seller is a party and pursuant to which Seller has granted to any third party any right to use any of the Transferred Technology, including the identity of all parties thereto, a description of the nature and subject matter thereof and the applicable royalty and term thereof.

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(f)            Schedule 2.15(f) lists all licenses, sublicenses and other agreements as to which Seller is a party and pursuant to which Seller is authorized to use any intellectual property belonging to any third party in connection with the Business, including the identity of all parties thereto, a description of the nature and subject matter thereof, the applicable royalty and term thereof.

(g)           The Seller owns, or has valid rights to use all of the Transferred Technology.

(h)           The conduct of the Business and manufacture, practice, use and sale of the Product as previously conducted, manufactured, practiced, used and sold, and as currently conducted, manufactured, used and sold did not and does not infringe, misappropriate, or otherwise violate any intellectual property or other proprietary right owned by any third party, or constitute unfair competition or trade practices under the laws of any jurisdiction.

(i)            There is no pending or, to the Knowledge of Seller, threatened (and at no time within the two years prior to the date of this Agreement has there been pending or, to the Knowledge of Seller, threatened any) action, suit, claim or proceeding, and Seller has not received any written complaint, claim, demand or notice from any third party, alleging that the conduct of the Business infringes, misappropriates, or otherwise violates or constitutes the unauthorized use of, or will infringe, misappropriate, or otherwise violate or constitute the unauthorized use of, the intellectual property or other proprietary right of any third party (nor does the Seller have Knowledge of any basis therefor).  The Seller is not a party to any settlement, covenant not to sue, consent, decree, stipulation, judgment, or order resulting from any Action which (i) restricts the Seller’s rights to use any Transferred Technology, (ii) restricts the Business in order to accommodate a third party’s intellectual property or (iii) requires any future payment by the Seller.  The Seller has not received any written or, to the Seller’s Knowledge, oral communication from any third party offering to license to the Seller any intellectual property purported to be used in the Business or claiming that the Seller must license or refrain from using any intellectual property or other proprietary rights of any third party in order to conduct the Business.

(j)            To the Knowledge of Seller, no third party is infringing, misappropriating, or otherwise violating or engaged in the unauthorized use of any Transferred Technology, and no actions, suits, claims or proceedings have been brought against any third party by the Seller alleging that a third party is infringing, misappropriating, or otherwise violating or engaged in the unauthorized use of any Transferred Technology.

(k)           The Seller has taken commercially reasonable steps to obtain, maintain and protect the Transferred Technology, including requiring each employee, consultant and independent contractor who or that has contributed in any way to the Transferred Technology or has made any contributions to the development of any Product to execute a written agreement that assigns to Seller all rights, title and interest in and to the Transferred Technology and any inventions, improvements, discoveries, information and other know-how relating to the Business and the Product.  Other than under an appropriate confidentiality or nondisclosure agreement or contractual provision relating to confidentiality and nondisclosure, there has been no disclosure to any third party of confidential information or trade secrets of the Seller related to any Product, the Business or the Transferred Technology and the Seller has taken all reasonable precautions to

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protect the secrecy, confidentiality and value of the Transferred Technology (including by the enforcement of a policy requiring each employee, consultant and independent contractor to execute proprietary information and confidentiality agreements substantially in the Seller’s standard form which has been provided by Seller to Purchaser).  Assignments to the Seller of the Patent Rights, copyrights and copyright applications listed in Schedule 1.1(a)(i)  have been duly executed and filed with the United States Patent and Trademark Office or Copyright Office, as applicable.  Assignments of trademark registrations and pending trademark applications listed in Schedule 1.1(a)(i)  and acquired from any third party have been duly executed and filed with the United States Patent and Trademark Office or foreign trademark authority, as applicable.

(l)            Neither the execution of this Agreement nor the consummation by the Seller of the transactions contemplated by this Agreement will result in any violation, loss or impairment of, or payment of any additional amounts with respect to, any Transferred Technology, nor require the consent of any governmental entity or third party with respect to any Transferred Technology.  The Seller is not a party to any Contract under which a third party would have or would be entitled to receive a license or any other right to any Transferred Technology any other property or assets of Purchaser or any of Purchaser’s affiliates as a result of the execution of this Agreement or the consummation of the transactions contemplated by this Agreement, nor would the consummation of such transactions result in the amendment or alteration of any license or other right which exists on the date of this Agreement.

(m)          Except as set forth on Schedule 2.15(m) , the Seller has not assigned or granted any exclusive rights in any Transferred Technology to any third party.

(n)           No government funding, facilities of a university, college, other educational institution or research center or funding from third parties was used in the development of any Transferred Technology.  To the Knowledge of Seller, no current or former employee, consultant or Independent Contractor of the Seller, who was involved in, or who contributed to, the creation or development of any Transferred Technology, has performed services for the government, university, college, or other educational institution or research center during a period of time during which such employee, consultant or independent contractor was also performing services for the Seller.

(o)           Seller and Purchaser are parties to that certain Joint Privilege Agreement dated as of March 5, 2008, pursuant to which Seller provided Purchaser with (i) an attorney-client privileged opinion of Seller’s retained counsel, dated February 29, 2008, and (ii) an attorney-client privileged opinion of Seller’s retained counsel, dated March 4, 2008 (collectively, the “ JPA Opinions ”).   The representations and warranties as to certain factual matters made by Seller to its counsel as set forth in the product package insert contained in the written certificate delivered by Seller to such counsel (a copy of which is attached as Schedule 2.15(o)  hereto), in connection with counsel’s rendering the JPA Opinions were true and correct in all respects on the date made.

Section 2.16         Insurance.   Schedule 2.16 contains a complete and correct list as of the date hereof of all insurance policies maintained by or on behalf of the Seller with respect to the Business and/or the Transferred Assets, including all legally required workers’ compensation insurance and errors and omissions, casualty, fire, product liability and general liability

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insurance.  True and complete copies of each listed policy have been furnished to Purchaser.  Such policies are in full force and effect, all premiums due thereon have been paid and the Seller has complied in all material respects with the provisions of such policies.  The Seller has not received any notice from any issuer of such insurance policies canceling or amending any policies listed on Schedule 2.16 .  There is no claim by the Seller pending under any of such policies as to which coverage has been denied or disputed by the underwriters or in respect of which the underwriters have reserved their rights.  Neither the Seller nor any affiliate thereof has ever maintained, established, sponsored, participated in or contributed to any self-insurance plan with respect to the Business and/or Transferred Assets.

Section 2.17         Fair Consideration; No Fraudulent Conveyance .  Seller is not now and Seller will not be rendered insolvent by the sale, transfer and assignment of the Transferred Assets pursuant to the terms of this Agreement or the transactions contemplated hereby.  Seller has no intention to file for bankruptcy, and, to Seller’s Knowledge, no insolvency proceedings of any character including without limitation, bankruptcy, receivership, reorganization, composition or arrangement with creditors, voluntary or involuntary, affecting Seller or any of the Transferred Assets or Assumed Liabilities are pending or threatened.  Seller is not entering into this Agreement and the transactions contemplated hereby with the intent to defraud, delay or hinder Seller’s creditors and the consummation of the transactions contemplated by this Agreement and the transactions contemplated hereby will not have any such effect.  The transactions contemplated hereby do not constitute a fraudulent conveyance, or otherwise give rise to any right of any creditor of Seller whatsoever to any of the Transferred Assets after the Technology Closing.

Section 2.18         Authorizations; Regulatory Compliance.

Schedule 2.18 sets forth a complete list of all approvals, clearances, authorizations, licenses or registrations required by any governmental entity having regulatory authority or jurisdiction over the Business and the Products, including the United States Food and Drug Administration (“ FDA ”) and any regulatory authority in the jurisdiction or country in which the Products are manufactured, to permit the design, development, pre-clinical and clinical testing, manufacture, labeling, marketing, promotion, import, export, use and sale of the Products, whether required of Seller or, to Seller’s Knowledge, required of any of its suppliers or manufacturers.  Except as set forth on Schedule 2.18 :

(a)           The Business and the Products are in compliance in all material respects with all current applicable laws, statutes, rules, regulations, ordinances, standards, guidelines or orders administered, issued or enforced by the FDA or any other governmental entity having regulatory authority or jurisdiction over the Business and the Products, including, without limitation, the PHSA and relevant sections of the FDCA , and the United States National Organ Transplant Act, Title 21 of the Code of Federal Regulations Part 1271, Human Cells, Tissues, and Cellular and Tissue Based Products..

(b)           Seller and, to the Knowledge of Seller, its suppliers and manufacturers are in compliance in all material respects with all applicable laws, statutes, rules, regulations, ordinances, standards, guidelines or orders administered , issued or enforced by the FDA or any other governmental entity, including the American Association of Tissue Banks, relating to the

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methods and materials used in, and the facilities and controls used for, the design, manufacture, processing, packaging, labeling, storage and distribution of the Products and all Products have been processed, manufactured, packaged, labeled, stored, handled and distributed by Seller in compliance with the quality control procedures and specifications furnished by Seller to Purchaser and all applicable laws, statutes, rules, regulations, ordinances, standards, guidelines or orders administered, issued or enforced by the FDA or any other governmental entity, including the American Association of Tissue Banks, including, without limitation, current Good Tissue Practice regulations promulgated by the FDA and the United States National Organ Transplant Act, Title 21 of the Code of Federal Regulations Part 1271, Human Cells, Tissues, and Cellular and Tissue Based Products.  Further, no governmental action has been taken or, to Seller’s Knowledge, is in the process of being taken that will slow, halt or enjoin the manufacturing of the Products or the operation of the Business or subject the manufacturing of the Products or the Business to regulatory enforcement action.

(c)           Seller has not received and, to Seller’s Knowledge, its manufacturers or suppliers have not received from the FDA or any other governmental entity, and to Seller’s Knowledge, there are no facts which would furnish any reasonable basis for, any notice of adverse findings, FDA warning letters, regulatory letters, notices of violations, warning letters, Section 305 criminal proceeding notices under the FDCA or other similar communication from the FDA or other governmental entity, and there have been no seizures conducted or, to Seller’s Knowledge, threatened by the FDA or other governmental entity, and no recalls, market withdrawals, field notifications, notifications of misbranding or adulteration, or safety alerts conducted, requested or threatened by the FDA or other governmental entity relating to the Business or to the Products.

(d)           For each of the Products, no pre-market notification (“ 510(k) ”) submission is required and no 510(k) submission has been filed with the FDA or any other governmental entity.

(e)           To Seller’s Knowledge, there are no currently existing facts which will (i) cause the withdrawal or recall, or require suspension or additional approvals or clearances, of any Products currently sold by Seller, (ii) require a change in the manufacturing, marketing classification, labeling or intended use of any such Products, or (iii) require the termination or suspension of marketing of any such Products.

(f)            Except as set forth on Schedule 2.18(f) , (i) none of the Products manufactured, marketed or sold by Seller has been recalled or subject to a field safety notification (whether voluntarily or otherwise); (ii) to Seller’s Knowledge none of the Products manufactured, marketed or sold by Seller’s manufacturers and suppliers has been recalled or subject to a field safety notification (whether voluntary or otherwise); and (iii) Seller has not received written notice (whether completed or pending) of any proceeding seeking recall, suspension or seizure of any products sold or proposed to be sold by Seller.

(g)           Seller has submitted to the FDA all Biological Product Deviation Reports relating to performance issues that could lead to serious injury or death that Seller has been required to submit under applicable federal statutes, rules, regulations, standards, guides or orders administered or promulgated by the FDA related to the Products.  To Seller’s Knowledge, except

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as set forth on Schedule 2.18(g) , no circumstances have arisen that would require Seller to submit a Biological Product Deviation Report to the FDA.

Section 2.19          Products; Product Liability .

(a)           Each of the Products (including all Finished Inventory): (i) is, and at all times up to and including the sale thereof has been processed, manufactured, packaged, labeled, stored, handled, distributed, shipped, marketed and promoted, and in all other respects has been, in compliance with all applicable laws, statutes, rules, regulations, ordinances or orders administered, issued or enforced by the FDA or any other governmental entity, including, without limitation, current Good Tissue Practice regulations promulgated by the FDA, the PHSA and relevant sections of the FDCA , and  the United States National Organ Transplant Act, Title 21 of the Code of Federal Regulations Part 1271, Human Cells, Tissues, and Cellular and Tissue Based Products and (b) is, and at all relevant times has conformed in all material respects to all specifications and any promises, warranties or affirmations of fact made in all regulatory filings or set forth in any regulatory approvals, authorizations or clearances pertaining thereto or made on the container or label for such Product or in connection with its sale.  There is no design or manufacturing defect with respect to the Products.

(b)           Schedule 2.19(b)  sets forth the forms of Seller’s service or product warranties that are currently applicable to services or merchandise related to the Business (including, without limitation, the Products).  Except as set forth on Schedule 2.19(b) , there are no existing or, to Seller’s Knowledge, threatened, claims against Seller for services or merchandise related to the Business which are defective or fail to meet any service or product warranties other than in the ordinary course of business consistent with past experience.  Seller has not incurred liability arising out of any injury to individuals as a result of the ownership, possession, or use of any Product and, to Seller’s Knowledge, there has been no inquiry or investigation made in respect thereof by any governmental entity.

Section 2.20          Environmental .

(a)           Except as would not be reasonably likely to result in a material liability of Seller with respect to the Business, (i) Seller is now and always has been in compliance with applicable legal requirements with respect to environmental laws, rules, regulations and ordinances, and (ii) to the Seller’s Knowledge, no underground storage tanks and no amount of any substance that has been designated by any governmental entity or by any legal requirements to be radioactive, toxic, hazardous or otherwise a danger to health or the environment, including PCBs, asbestos, petroleum, toxic mold, urea-formaldehyde and all substances listed as hazardous substances pursuant to the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended, or defined as a hazardous waste pursuant to the United States Resource Conservation and Recovery Act of 1976, as amended, and the regulations promulgated pursuant to said laws, but excluding office and janitorial supplies (a “ Hazardous Material ”), are present in, on or under any property of Seller used in the Business, including the land and the improvements, ground water and surface water thereof.

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(b)           Except as would not be reasonably likely to result in a material liability to Seller with respect to the Business, Seller has not transported, stored, used, manufactured, disposed of, released, removed or exposed its employees or others to Hazardous Materials in violation of any legal requirement or manufactured any product containing a Hazardous Material in violation of any legal requirement, nor has Seller received notification from any party that it has or is alleged to have any remediation obligation relating to any Hazardous Material.

Section 2.21         Real Property; Leases .   Except as set forth on Schedule 2.21 , Seller does not own, lease or sublease any real property used in or necessary for the operation of the Business.

Section 2.22         Brokers .   Except as set forth on Schedule 2.22 , no broker or other representative has acted on behalf of Seller in connection with the transaction contemplated hereby in such manner as to give rise to any  claim by any person against Purchaser or Seller for a finder’s fee, brokerage commission or similar payment.

Section 2.23         Capital Expenditures .    Set forth on Schedule 2.23 is a list of Seller’s approved capital expenditure projects related to the Business and involving in excess of $25,000 including:  (i) projects which have been commenced but are not yet completed; (ii) projects which have not been commenced; and (iii) projects which have been completed in respect of which payment has been made, within the last twelve (12) months.

Section 2.24         No Changes . Except as set forth on Schedule 2.24 , since December 31, 2007 there has not been, occurred or arisen any of the following:

(a)           any amendment to the Seller Organizational Documents;

(b)           any incurrence or assumption by the Business of any indebtedness in excess of $5,000 individually or $25,000 in the aggregate;

(c)           the imposition of any Lien (other than Permitted Liens) upon any of the Transferred Assets;

(d)           any material damage, destruction or loss with respect to the Transferred Assets or any other real or tangible personal property used in the Business, whether or not covered by insurance;

(e)           any payment, loan or advance of any amount to, or sale, transfer or lease of any of the Transferred Assets to, or any agreement or arrangement relating to the Business or constituting a Transferred Asset with, any member or equity holder of Seller or any of their respective affiliates;

(f)            any change in the Tax or accounting principles, methods, practices or procedures followed by Seller or any change in the depreciation or amortization policies or rates theretofore adopted by Seller, except as required by GAAP or disclosed to Purchaser in writing;

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(g)           any change or revocation by Seller of any Tax election with respect to the Business or any agreement or settlement with any governmental entity with respect to such Taxes;

(h)           any acquisition by Seller by merging or consolidating with, or by purchasing a substantial portion of the assets of, or by any other manner, any business or corporation, partnership, association or other business organization or division thereof comprising all or a portion of the Business or the Transferred Assets;

(i)            any sale, lease or other transfer or disposition by Seller of its assets related to the Business, tangible or intangible, other than the sale of Product in the ordinary course of the Business;

(j)            any Contract (or series of related Contracts) related to the Business and entered into by Seller either involving more than $25,000 individually (or $50,000 in the aggregate) or outside the ordinary course of business;

(k)           any acceleration, termination, modification or cancellation of any Assumed Contract involving more than $25,000 individually (or $50,000 in the aggregate);

(l)            any capital expenditure (or series of related capital expenditures) related to the Business by Seller either involving more than $25,000 individually (or $50,000 in the aggregate) or outside the ordinary course of business;

(m)          any capital investment in, any loan to or any acquisition of the securities or assets of, any other person by Seller with respect to or in connection with the Business;

(n)           any delay or postponement of payment of accounts payable or other liabilities of Seller with respect to or in connection with the Business outside the ordinary course of Business consistent with past practice;

(o)           any cancellation, compromise, waiver or release of any right or claim of Seller with respect to or in connection with the Business outside the ordinary course of Business consistent with past practice;

(p)           the commencement or written notice to Seller or, to Seller’s Knowledge, oral notice or threat of commencement of any lawsuit or proceeding against the Transferred Assets or against Seller with respect to the Transferred Assets, the Product or the Business;

(q)           any license or sublicense of any rights of Seller under or with respect to the Transferred Technology;

(r)            any written notice or claim to Seller or, to Seller’s Knowledge, oral notice or claim of ownership by any Person of Business Intellectual Property or of infringement by the Business of any Person’s intellectual property rights;

(s)           any material change in pricing charged by Seller for Products; or

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(t)            any negotiation or agreement by Seller or any officer or employee thereof to do any of the things described in the preceding clauses (a) through (s) (other than negotiations with Purchaser and its representatives regarding the transactions contemplated by this Agreement).

Since December 31, 2007, no Business Material Adverse Effect has occurred, and no event, circumstance, condition or effect has occurred that could reasonably be expected to result in a Business Material Adverse Effect.

Section 2.25         Obsolete Items .   Schedule 2.25 sets forth, as of the date hereof, a complete and accurate list of any category of products, supplies or parts used in the Business that has an aggregate inventory value in excess of $10,000 that has been identified through reasonable business practices to be obsolete, damaged or defective.

Section 2.26         Customers and Suppliers .   Schedule 2.26 identifies the Business’ ten (10) largest customers and suppliers (measured by dollar volume in each case) during the calendar year 2007 and during the first three months of 2008, showing with respect to each, the name and address, dollar volume and nature of the relationship (including the principal categories of Product bought or sold).  Seller is not required to provide any bonding or other financial security arrangements in connection with any of the transactions with its customers or supplies.  Seller has not received any direct communication (whether written or oral) of any intention of any customer or supplier identified on Schedule 2.26 to discontinue its relationship as a customer or supplier of, or materially reduce its purchases from or sales to Seller (or, post-Technology Closing, from Purchaser).

Section 2.27         Disclosure . No statement (including without limitations, the representations and warranties and covenants contained in this Agreement) by Seller contained in this Agreement and none of the information contained in the schedules hereto, in any other Transaction Document and any document, written statement or certificate furnished to Purchaser and its representatives to Seller contains or will contain any untrue statement of a material fact or omits or will omit to state a material fact necessary to make the statements herein or therein, in light of the circumstances in which they were made, not misleading.  To the Seller’s Knowledge, there exists no fact that adversely affects the value of the Transferred Assets or the Business, prospects, financial condition or operations of the Business which has not been set forth in this Agreement or the schedules hereto.  Seller has afforded to the officers, employees and authorized representatives of Purchaser (including, without limitation, independent public accountants and attorneys) access to all financial and other books and records (including computer files, retrieval programs and similar documentation) of Seller with respect to the Business.

ARTICLE III.

REPRESENTATIONS AND WARRANTIES OF PURCHASER

Purchaser hereby represents and warrants to Seller as of the date hereof as follows:

Section 3.1            Organization and Authority .  Purchaser is duly formed, validity existing and in good standing under the laws of the State of Delaware and is duly qualified as a foreign corporation to transact business and is in good standing in each jurisdiction in which such qualification is required, except when failure to be so qualified would not materially and

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adversely affect Purchaser’s business.  Purchaser has full corporate power and authority to execute and deliver this Agreement and the Transaction Documents to which it is party, to perform its obligations hereunder and under the Transaction Documents, to consummate the transactions contemplated hereby and thereby and to own and carry on the operation of its business as currently operated by it.

Section 3.2            Organizational and Governing Documents; Approval .

                (a)           Prior to the date hereof, Purchaser has furnished to Seller complete and correct copies of the certificate of incorporation and bylaws of Purchaser (the “ Purchaser Organizational Documents ”).  The Purchaser Organizational Documents are in full force and effect and Purchaser is not in violation of any provision of the Purchaser Organizational Documents.

(b)           This Agreement and the Transaction Documents to which Purchaser is a party have been approved by all necessary corporate action of Purchaser.

Section 3.3            Due Execution and Delivery .   Purchaser has all necessary corporate power and authority to execute and deliver this Agreement and the other Transaction Documents to which it is a party and each instrument required hereby and thereby to be executed and delivered by it, and to carry out its obligations hereunder and thereunder.  Purchaser has duly executed and delivered this Agreement and, assuming the due authorization, execution and deliver of this Agreement by Seller, this Agreement constitutes (and, when executed and delivered, the Transaction Documents to which it is a party will constitute) the legal, valid and binding obligations of Purchaser enforceable against it in accordance with its terms, except that such enforcement (a) may be limited by bankruptcy, insolvency, moratorium or similar laws affecting creditors’ rights generally, and (b) is subject to the availability of equitable remedies, as determined in the discretion of the court before which such a proceeding may be brought.

Section 3.4            Consents; No Conflicts .   No consent, authorization, permit, waiver or approval of or from or notice to any person or any governmental authority is required as a condition to the execution and delivery of this Agreement by Purchaser or any of the Transaction Documents to which it is a party and the consummation of the transactions contemplated by this Agreement and such Transaction Documents by Purchaser.  The execution and delivery of this Agreement and the other Transaction Documents and each instrument required hereby to be executed and delivered by Purchaser and the consummation of the transactions contemplated hereby and thereby by Purchaser will not contravene any applicable law or the Purchaser Organizational Documents.

Section 3.5            Brokers .   No broker or other representative has acted on behalf of Purchaser in connection with the transaction contemplated hereby in such manner as to give rise to any valid claim by any person against Seller for a finder’s fee, brokerage commission or similar payment.

ARTICLE IV.

CERTAIN COVENANTS AND AGREEMENTS

Section 4.1            Further Assurances .   Each of Seller and Purchaser covenants and agrees with the other that at any time and from time to time hereafter, and without further consideration,

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each will promptly execute and deliver to the other such further assurances, instruments and documents and take such further action as the other may reasonably request in order to carry out the full intent and purpose of this Agreement and to consummate the transactions contemplated hereby.  Without limiting the foregoing, Seller covenants and agrees with Purchaser that at any time and from time to time following the Technology Closing Date, if Seller shall be in breach of its representations and warranties set forth in Section 2.4 (Title and Sufficiency of Transferred Assets), Seller will, without further consideration, promptly execute and deliver to Purchaser such further assurances, instruments and documents and take such further action as Purchaser may reasonably request in order to remedy the breach of such representations and warranties.

Section 4.2            Conduct of Activities Associated with the Transferred Assets . During the period from the date of this Agreement to (i) the Technology Closing with respect to the Technology Assets and (ii) the Manufacturing Closing with respect to the Manufacturing Assets, Seller will conduct its activities associated with the Transferred Assets in their ordinary and usual course, consistent with past practice, and will use commercially reasonable efforts to (i) preserve intact all rights, privileges, franchises and other authority related to the activities associated with the Transferred Assets and (ii) maintain in their current or currently planned condition (as such currently planned condition has been expressly communicated to Purchaser including but not limited to those matters set forth in the schedules hereto) its current relationships with licensors, licensees, suppliers, contractors, distributors, customers, and others having relationships related to the activities associated with the Business and the Transferred Assets.  Without limiting the generality of the foregoing, and except as (i) expressly contemplated by this Agreement, (ii) set forth on Schedule 4.2 or (iii) approved in writing by Purchaser in advance, prior to the Technology Closing with respect to all Transferred Assets and the Manufacturing Closing with respect to the Manufacturing Assets, Seller will not:

(a)           create, incur or assume any obligation which would materially and adversely affect the Transferred Assets or Purchaser’s ability to conduct Business in substantially the same manner and condition as conducted by Seller on the date of this Agreement;

(b)           enter into any contract that, if entered into prior to the date hereof would be required to be set forth on Schedule 1.1(a)(x)  or violate, terminate, amend or otherwise modify or waive any of the terms of any Assumed Contract;

(c)           sell, lease, license, transfer or dispose of any of the Transferred Assets (except for sales of Product in the ordinary course of business consistent with its past practices);

(d)           change any of its accounting methods with respect to the Business or the Transferred Assets;

(e)           terminate, waive or release any material right or material claim with respect to the Business or any of the Transferred Assets;

(f)            license any of the Transferred Technology (except for licenses under its standard customer agreement made in the ordinary course of business consistent with its past practices);

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(g)           (i) initiate any litigation, action, suit, proceeding, claim or arbitration or (ii) settle or agree to settle any litigation, action, suit, proceeding, claim or arbitration, in each case with respect to the Business or the Transferred Assets;

(h)           change the manner in which it extends warranties, discounts or credits to customers with respect to the Products;

(i)            modify, allow to lapse or otherwise fail to maintain insurance coverage with respect to the Transferred Assets at levels consistent with the amounts of such coverage in effect as of the date hereof;

(j)            sell, dispose of or encumber any of the Transferred Assets or license any Transferred Assets to any person;

(k)           enter into any agreements or commitments relating to the activities associated with the Transferred Assets;

(l)            fail to comply in all material respects with all laws and regulations applicable to the activities associated with the Transferred Assets;

(m)          change or announce any change to the Business or the Transferred Assets; or

(n)           (i) agree to do any of the things described in the preceding clauses (a)-(m) or (ii) take or agree to take any action which would reasonably be expected to prevent Seller from performing or cause Seller not to perform one or more covenants required hereunder or under any other Transaction Document to be performed by Seller.

Section 4.3            Financial Statements.

(a)           Prior to the Technology Closing, Seller shall deliver to Purchaser historical financial statements for the Business for the fiscal year 2007 and, for each completed month period of 2008 and for the period between the last completed month and the Technology Closing Date, in each case in a form that complies with what is required by Item 9.01 of Form 8-K and Regulation S-X of the federal securities laws for a business acquisition required to be described in answer to Item 2.01 of Form 8-K, including information required in order for Purchaser to prepare the pro forma financial information required by Item 9.01 of Form 8-K.  The historical financial statements for the Business for the fiscal year 2007 shall be accompanied by an unqualified report from Seller’s independent registered accounting firm (with notes thereto) stating to the effect that such financial statements present fairly, in all material respects, the financial position of the Business, as well as the results of operations and cash flows of the Business, for each of the periods covered by such financial statements, in conformity with GAAP.

(b)           Not later than thirty (30) days after the completion of each fiscal quarter of Seller that occurs during the period from the date of this Agreement through and up to the Technology Closing Date, Seller shall deliver to Purchaser quarterly financial statements for the Business (together with any required notes) in a form that Seller prepares for internal financial reporting; provided, however, that Seller shall provide Purchaser with such additional information as

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Purchaser may reasonably request in order to comply with the requirements for financial statements included in Quarterly Reports on Form 10-Q filed under the Securities Exchange Act of 1934, as amended.

(c)           On or prior to the Technology Closing Date, Seller shall deliver to Purchaser the audited balance sheets and statements of income, changes in stockholders’ equity and cash flows of the Business as of the end of and for each of the fiscal years ended December 31, 2006 and December 31, 2007 or such other periods as shall be required to be reported by Purchaser by Item 9.01 of Form 8-K and Regulation S-X of the federal securities laws for a business acquisition required to be described in answer to Item 2.01 of Form 8-K (the “ Audited Financial Statements ”).  The Audited Financial Statements shall be accompanied by an unqualified report from Seller’s independent registered accounting firm stating to the effect that the Audited Financial Statements present fairly, in all material respects, the financial position of the Business, as well as the results of operations and cash flows of the Business, for each of the periods covered by the Audited Financial Statements, in conformity with GAAP.

(d)           After the Technology Closing, at the reasonable request of Purchaser, Seller shall, and shall cause its affiliates to, cooperate fully in the preparation of all financial statements reasonably determined by Purchaser to be necessary to meet its financial reporting and Tax obligations in connection with the consummation of the transactions contemplated hereby.  Seller shall provide Purchaser with any records and other information in Seller’s possession or control as shall be reasonably requested by Purchaser in connection therewith and shall use commercially reasonable efforts to cause to be provided to Purchaser any records and other information that is not in the possession or control of Seller as shall be reasonably requested by Purchaser in connection therewith and shall use commercially reasonable efforts to provide Purchaser with access to Seller’s accountants.

Section 4.4            Post-Technology Closing Receipts .   Seller shall hold in trust for, and promptly remit to Purchaser without deduction, any amounts collected or received by Seller that relate to the Business or Purchaser following the Technology Closing.  Purchaser shall hold in trust for, and promptly remit to Seller without deduction, any amounts collected or received by Purchaser that either constitute accounts receivable related to Product sold by Seller prior to the Technology Closing Date or that do not relate to the Transferred Assets.

Section 4.5            Confidentiality.   Seller will maintain confidential all information related to the Business, the Product and the Transferred Assets including, without limitation, business plans and proposals, marketing strategies, standard operating procedures, personnel data, pricing, intellectual property and all other information that would be considered confidential and proprietary (“ Confidential Information ”).

(b)           For a period of five (5) years from the Technology Closing Date, Seller will treat all Confidential Information with the same degree of care that it employs with respect to its own confidential information which it does not desire to have published or disseminated.  In no event will that degree of care be less than that employed by a reasonable person.  Notwithstanding the foregoing, Seller shall have no such obligation with respect to that portion of the Confidential Information that Seller can demonstrate is (i) in the public domain or enters the public domain without the wrongful act or breach of this Agreement by Seller, (ii) approved in advance in

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writing by Purchaser for release by Seller or (iii) disclosed by order of a court of competent jurisdiction, provided that such disclosure is subject to all applicable governmental or judicial protection for like material and reasonable advance notice is give by Seller to Purchaser.

The fact that Confidential Information may be in or becomes part of the public domain, in and of itself, does not exclude any specific information from obligations of this Agreement.

Section 4.6            No Other Bids .

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