CONFIDENTIALITY AGREEMENT

 
This Agreement (this “Agreement”) is made and entered into as of October 24,
2007, by and between Kensey Nash Corporation (the “Company”), and each of the
entities and natural persons listed on Schedule A hereto (such entities and
natural persons and any Ramius Nominee that executes a joinder to this
Agreement, collectively, the “Ramius Group”) (each of the Company and the Ramius
Group, a “Party” to this Agreement, and collectively, the “Parties”).

WITNESSETH:

WHEREAS, in connection with the execution and performance of a Settlement
Agreement between the Parties and certain other parties affiliated with the
Ramius Group, dated October 24, 2007 (the “Settlement Agreement”), regarding the
nomination of certain persons to the Board of Directors of the Company (the
“Board”) and the Ramius Group’s forbearance of certain activities during the
Standstill Period (as defined in the Settlement Agreement), the Company expects
to provide or otherwise make available to either or both of Jeffrey Smith and
Ceasar Anquillare (the “Ramius Nominees”) certain information, including
information made available to either or both Ramius Nominees pursuant to Section
1 of this Agreement, developed by and/or concerning the Company that is
non-public, confidential or proprietary in nature, including business and
financial information concerning the Company and/or its operations (such
information collectively, “Confidential Information”);

NOW THEREFORE, in consideration of the agreements, covenants and premises set
forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Parties hereto hereby agree as
follows:
 
1. The Company hereby agrees that prior to the 2007 Annual Meeting of
Stockholders of the Company (the “2007 Annual Meeting”), the Company will not
take any action that the Board considers material without first advising a
Ramius Nominee regarding such action. The Ramius Nominees shall use the
Confidential Information solely for the purpose of evaluating the Company and
actions proposed to be taken by the Company, in connection with their respective
preparations to serve as members of the Board if elected at the 2007 Annual
Meeting.
 
2. All Confidential Information furnished by the Company to a Ramius Party will
be kept confidential by all Ramius Parties and shall not, without the prior
written consent of the Company, be disclosed by any Ramius Party in any manner
whatsoever, in whole or in part, and shall not be used by any Ramius Party other
than as necessary for the purpose of evaluating the Company and actions proposed
to be taken by the Company and the Ramius Group’s investment in the Company.
Moreover, each Ramius Party shall reveal the Confidential Information only to
other Ramius Parties that need to know the Confidential Information for such
purpose, who are informed by the revealing Ramius Party of the confidential
nature of the Confidential Information and who agree to be bound by the terms
and conditions of this Agreement. No Ramius Party shall, without the prior
written consent of the Company, disclose any of the Confidential Information to
its shareholders, members, other security holders or affiliates, or any of them,
that are not Ramius Parties. Each member of the Ramius Group shall cause its
Ramius Affiliates to comply with this Agreement. Each member of the Ramius Group
shall be jointly and severally responsible for any breach of this Agreement by
any Ramius Party. “Ramius Affiliates” means the directors, officers, managers,
agents, representatives (including attorneys, accountants and financial
advisers) and employees of the Company of any member of the Ramius Group; and
“Ramius Parties” means the Ramius Affiliates and the members of the Ramius
Group.
 
 
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3. No Ramius Party shall, without the prior written consent of the Company,
disclose to any person the fact that the Confidential Information has been made
available by the Company to a Ramius Party. The term “person” as used in this
Agreement shall be broadly interpreted to include, without limitation, the media
and any individual, group, corporation, partnership, limited liability company
or other entity, including any government or agency thereof.
 
4. All Confidential Information received by a Ramius Party hereunder will be
returned to the Company promptly upon the request of the Company, subject to any
documentation retention policies to which such Ramius Party is subject as
required by law or regulatory authority; provided, however, that any analyses,
compilations, studies or other documents prepared by a Ramius Party based upon
or relating to or otherwise constituting Confidential Information shall be
deemed to be Confidential Information and will be, at the option of the Company,
either destroyed or held by such Ramius Party and kept confidential and subject
to the terms of this Agreement, subject to any documentation retention policies
to which such Ramius Party is subject as required by law or regulatory
authority.
 
5. No Ramius Party will photocopy, reproduce or distribute to others any
Confidential Information received at any time, except for distribution to
persons entitled to receive Confidential Information hereunder for the purposes
contemplated hereby or with the prior written consent of the Company.
 
6. Notwithstanding anything to the contrary contained herein: “Confidential
Information” shall not include information which: (a) is at the time of
disclosure or thereafter becomes generally available to the public other than as
a result of a disclosure by a Ramius Party; (b) was, prior to disclosure by the
Company, already in a Ramius Party’s possession, provided that the source of
such information was, to such Ramius Party’s knowledge after reasonable inquiry,
not bound by a confidentiality agreement with or other contractual, legal or
fiduciary obligation of confidentiality to the Company or a Company Affiliate;
(c) becomes available to a Ramius Party on a nonconfidential basis from a source
(other than the Company or a Company Affiliate) that is, to such Ramius Party’s
knowledge after reasonable inquiry, not bound by a confidentiality agreement
with or other contractual, legal or fiduciary obligation of confidentiality to
the Company or a Company Affiliate, and is not, to such Ramius Party’s knowledge
after reasonable inquiry, under an obligation to the Company or a Company
Affiliate not to transmit the information to such Ramius Party; or (d) was
independently developed by a Ramius Party or a Ramius Affiliate without
reference to or use of the Confidential Information. “Company Affiliates” means
the directors, officers, agents, representatives (including attorneys,
accountants and financial advisers) and employees of the Company.
 
7. Each member of the Ramius Group acknowledges that neither the Company nor any
Company Affiliate makes any representation or warranty as to the accuracy or
completeness of the Confidential Information furnished by it to any Ramius
Party. Neither the Company nor any Company Affiliate shall have any liability to
any Ramius Party hereunder resulting from the use of the Confidential
Information by a Ramius Party.
 
8. In the event that any Ramius Party or any person to whom any Ramius Party
transmits Confidential Information becomes legally required to disclose any
Confidential Information furnished to it, the Ramius Group will, to the extent
legally permissible, provide the Company with prompt notice thereof so that the
Company may, if available, promptly seek a protective order or other appropriate
remedy and/or waive compliance with the provisions of this Agreement. In the
event that such protective order or other remedy is not obtained, or the Company
waives compliance with the provisions of this Agreement, the Ramius Party (or
the person to whom the Ramius Party transmitted such Confidential Information)
may, without liability hereunder, disclose only that portion of the Confidential
Information furnished hereunder which, based upon the advice of counsel of such
Ramius Party, the disclosure of which is legally required and will exercise its
reasonable best efforts to obtain a protective order or other reliable assurance
that confidential treatment will be accorded the Confidential Information.
 
 
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9. Each member of the Ramius Group acknowledges and agrees that irreparable
injury to the Company would occur in the event any Ramius Party obligations
under this Agreement were not performed in accordance with the specific terms of
this Agreement or a Ramius Party otherwise breached this Agreement and that such
injury would not be adequately compensable in damages. It is accordingly agreed
by each member of the Ramius Group that the Company shall be entitled to
specific enforcement of (without the necessity of posting a bond or other
security or proving actual damages), and injunctive relief to prevent any
violation of (without the necessity of posting a bond or other security or
proving actual damages), the terms of this Agreement by any Ramius Party and
that no Ramius Party will take any action, directly or indirectly, in opposition
to the Company seeking such relief on the grounds that any other remedy or
relief is available at law or in equity. This Section 9 shall not in any way
affect a Party’s right to exercise its rights at law. Each member of the Ramius
Group, jointly and severally, shall reimburse, indemnify and hold harmless the
Company and the Company Affiliates against any and all costs and liabilities
arising from the breach of any provision of this Agreement by any Ramius Party.
 
10. The terms, conditions and provisions of this Agreement shall apply only with
respect to Confidential Information received by a Ramius Party prior to the
earlier of (i) the election of the Ramius Nominees to the Board or (ii) the
conclusion of the Company’s 2007 Annual Meeting.
 
11. Each member of the Ramius Group hereby irrevocably appoints RCG Starboard
Advisors, LLC as such member’s attorney-in-fact and representative (the “Ramius
Representative”), in such member’s place and stead, to do any and all things and
to execute any and all agreements, instruments and other documents and any
amendments, modifications and waivers thereto and hereto and to give and receive
any and all notices or instructions in connection with this Agreement and the
transactions contemplated hereby. The Company shall be entitled to rely, as
being binding on each member of the Ramius Group, upon any action taken by the
Ramius Representative or upon any document, notice, instruction or other writing
given or executed by the Ramius Representative. Each member of the Ramius Group
acknowledges and agrees that each agreement, covenant or other obligation of the
Ramius Group hereunder shall be binding on such member of the Ramius Group.
 
12. Each member of the Ramius Group acknowledges and agrees that it is aware of
the restrictions imposed by the United States securities laws on the purchase or
sale of securities by any person who has received material nonpublic information
from the issuer of securities, and on the communication of such information to
any other person when it is reasonably foreseeable that such other person is
likely to purchase or sell such securities in reliance upon such information.
 
13. This Agreement shall be governed by and construed in accordance with the
laws of the State of Delaware, without reference to its conflict of law rules.
 
14. This Agreement constitutes the entire agreement between the Parties with
respect to the subject matter hereof and supersedes all prior agreements
understandings, both written and oral, among the Parties with respect to the
subject matter hereof. No modifications of this Agreement can be made except in
writing signed by an authorized representative of each of the Company and each
member of the Ramius Group.
 
 
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15. If at any time subsequent to the date hereof, any provision of this
Agreement shall be held by any court of competent jurisdiction to be illegal,
void or unenforceable, such provision shall be of no force and effect, but the
illegality or unenforceability of such provision shall have no effect upon the
legality or enforceability of any other provision of this Agreement.
 
16. This Agreement and any amendments hereto may be executed and delivered in
one or more counterparts, and by the different parties hereto in separate
counterparts, each of which when executed shall be deemed to be an original, but
all of which taken together shall constitute one and the same agreement, and
shall become effective when counterparts have been signed by each party hereto
and delivered to the other parties hereto, it being understood that all parties
need not sign the same counterpart. In the event that any signature to this
Agreement or any amendment hereto is delivered by facsimile transmission or by
e-mail delivery of a “.pdf” format data file, such signature shall create a
valid and binding obligation of the party executing (or on whose behalf such
signature is executed) with the same force and effect as if such facsimile or
“.pdf” signature page were an original thereof. At the request of any party each
other party shall promptly re-execute an original form of this Agreement or any
amendment hereto and deliver the same to the other party. No party hereto shall
raise the use of a facsimile machine or e-mail delivery of a “.pdf” format data
file to deliver a signature to this Agreement or any amendment hereto or the
fact that such signature was transmitted or communicated through the use of a
facsimile machine or e-mail delivery of a “.pdf” format data file as a defense
to the formation or enforceability of a contract, and each party hereto forever
waives any such defense.This Agreement embodies the entire agreement between the
Parties and supersedes any and all prior or contemporaneous oral or written
agreements, arrangements and understandings concerning the matters provided for
herein.
 
17. Any notices, consents, determinations, waivers or other communications
required or permitted to be given under the terms of this Agreement must be in
writing and will be deemed to have been delivered: (i) upon receipt, when
delivered personally; (ii) upon receipt, when sent by facsimile (provided
confirmation of transmission is mechanically or electronically generated and
kept on file by the sending party); or (iii) one (1) Business Day after deposit
with a nationally recognized overnight delivery service, in each case properly
addressed to the party to receive the same. The addresses and facsimile numbers
for such communications shall be:
 
If to the Company:
 
Kensey Nash Corporation
735 Pennsylvania Drive
Exton, Pennsylvania 19341
Attention: Joseph Kaufman
Facsimile: 484-713-2901

With a copy to:

Katten Muchin Rosenman LLP
525 W. Monroe Street
Chicago, Illinois 60661-3693
Attention: David Shevitz, Esq. and Mark D. Wood, Esq.
Facsimile: 312-902-1061

 
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If to the Ramius Group or any member of the Ramius Group:

Ramius Capital Group, L.L.C.
666 Third Avenue, 26th Floor
New York, New York 10017
Attention: Jeffrey Smith
Facsimile: 212-201-4802
 
With a copy to:
 
Olshan Grundman Frome Rosenzweig & Wolosky LLP
Park Avenue Tower
65 East 55th Street
New York, New York 10022
Attention: Steven Wolosky, Esq.
Facsimile: (212) 451-2222
 
 
18. This Agreement shall be binding upon and inure to the benefit of the Parties
and their respective successors and assigns. No Party shall assign this
Agreement or any rights or obligations hereunder without, with respect to any
member of the Ramius Group, the prior written consent of the Company, and with
respect to the Company, the prior written consent of the Ramius Representative.
 
19. The language used in this Agreement will be deemed to be the language chosen
by the parties to express their mutual intent, and no rules of strict
construction will be applied against any party. Unless the context otherwise
requires, (a) all references to Sections or Schedules are to Sections or
Schedules contained in or attached to this Agreement, (b) words in the singular
or plural include the singular and plural and pronouns stated in either the
masculine, the feminine or neuter gender shall include the masculine, feminine
and neuter, and (c) the use of the word “including” in this Agreement shall be
by way of example rather than limitation.
 

 
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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the
day and year first above written.
 

 
KENSEY NASH CORPORATION
     
By:
     
Name:
Joseph W. Kaufmann
   
Title:
Chief Executive Officer,
President, Secretary

 
 
PARCHE, LLC
RCG STARBOARD ADVISORS, LLC
       
By:
RCG Starboard Advisors, LLC, its managing member
By:
Ramius Capital Group, L.L.C., its sole member

STARBOARD VALUE AND OPPORTUNITY MASTER FUND LTD.
RAMIUS CAPITAL GROUP, L.L.C.
 
By: C4S & Co., L.L.C.,
       as managing member
   
By:
RCG Starboard Advisors, LLC, its
investment manager
 
C4S & CO., L.L.C.

By:
   
Name:
Jeffrey M. Solomon
 
Title:
Authorized Signatory

     
PETER A. FELD

     
JEFFREY C. SMITH
         
Individually and as attorney-in-fact for Ceasar Anquillare
   

 
 
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By: Starboard Value and Opportunity Master Fund Ltd.

By: ________________________________ 
Name: Jeffrey M. Solomon
Title: Authorized Signatory

By: Parche, LLC

By: ________________________________ 
Name: Jeffrey M. Solomon
Title: Authorized Signatory

By: RCG Enterprise, Ltd

By: ________________________________ 
Name: Jeffrey M. Solomon
Title: Authorized Signatory
 
By: RCG Starboard Advisors, LLC

By: ________________________________ 
Name: Jeffrey M. Solomon
Title: Authorized Signatory     

By: Ramius Capital Group, L.L.C.
 
By: ________________________________
Name: Jeffrey M. Solomon 
Title: Authorized Signatory

By: C4S & CO., L.L.C.

By: ________________________________
Name: Jeffrey M. Solomon
Title: Authorized Signatory

 
 
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SCHEDULE A
 
The Ramius Group

Parche, LLC
 
Starboard Value and Opportunity Master Fund Ltd.
 
RGC Starboard Advisors, LLC
 
Ramius Capital Group, L.L.C.
 
C4S & CO., LLC
 
RCG Enterprise, Ltd
 
Ceasar Anquillare
 
Peter A. Feld
 
Jeffrey C. Smith

 
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