FIRST AMENDMENT TO MANUFACTURING & DEVELOPMENT AGREEMENT

This First Amendment to Manufacturing and Development Agreement (“Amendment”) is made and entered into as of this __ day of July 2007, by and between Arthrex, Inc., a Delaware corporation having its principle place of business at 2885 South Horseshoe Drive, Naples, Florida 34104 (“Arthrex”) and Bovie Medical Corporation, a Delaware corporation having its principle place of business at 7100 30 ^th Avenue N, St. Petersburg, Florida 33710 (“Bovie”).  Arthrex and Bovie are each a “Party” and, together, are “Parties.”

WHEREAS, capitalized terms used herein have the meaning set forth in this Amendment or the meaning set forth in the respective agreement referenced herein where such capitalized terms are defined;

WHEREAS, the Parties entered into that certain Manufacturing and Development Agreement with a Start Date of December 6, 2002 (the “M&D Agreement”);

WHEREAS, the Parties entered into that certain Original Equipment Manufacturing Agreement with a Start Date of March 13, 2003 (the “OEM Agreement”);

WHEREAS, pursuant to Section 6.0 of the M&D Agreement, on or about May 22, 2007, Arthrex provided Bovie with its written notice of non-renewal of the M&D Agreement, which is set to expire on December 6, 2007 (the “Amendment Effective Date”) and of the OEM Agreement, which is set to expire on March 14, 2008;

WHEREAS, pursuant to Section 12.7 of the M&D Agreement, the Parties may modify the M&D Agreement only by a signed writing; and

WHEREAS, in lieu of non-renewal or termination pursuant to Section 6.0, the Parties have negotiated new terms respecting (i) exclusivity, (ii) non-competition, (iii) minimum purchase quantities, and (iv) related and affected provisions, under which the Parties desire to modify, renew and extend the M&D Agreement (and, by a separate instrument, the OEM Agreement), as further set forth below.

NOW, THEREFORE, in consideration of the foregoing recitals (which are incorporated herein and made a part hereof) and other good and valuable consideration, the sufficiency of which is hereby acknowledged, the Parties agree as follows.

Notwithstanding anything to the contrary in Sections 2.1(b) and (c), in the event that any change or modification to the Products or the Product Specifications requires additional professional services, or results in a change in the costs incurred by Bovie in the engineering, development, production, manufacture, sterilization or packaging of the Products, Bovie shall so notify Arthrex and, upon Bovie’s receipt of Arthrex’s written c