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                                                                    EXHIBIT 4.3
                           RESTRICTED UNITS AGREEMENT

                  AGREEMENT, dated as of December 22, 2000, by and between
Integra LifeSciences Holdings Corporation, a Delaware corporation (the
"Company"), and Stuart M. Essig ("Executive").

                  WHEREAS, the Company and Executive have entered into an
Amended and Restated Employment Agreement (the "Employment Agreement"), dated as
of December 22, 2000, pursuant to which Executive will continue to serve as
President and Chief Executive Officer of the Company, on the terms and
conditions set forth and described therein; and

                  WHEREAS, pursuant to the Employment Agreement, the Company has
agreed to grant to Executive an aggregate of 1,250,000 restricted units (the
"Units") representing an equal number of shares of restricted common stock of
the Company, par value $.01 per share ("Common Stock"), on the terms set forth
herein; and

                  WHEREAS, the grant of Units and restricted Common Stock
hereunder is being made under the Integra LifeSciences Holdings Corporation 2000
Equity Incentive Plan (the "Plan"), a copy of which is attached.

                  NOW, THEREFORE, the parties agree as follows:

         1. DEFINITIONS. Capitalized terms not otherwise defined herein shall
have the meaning set forth in the Employment Agreement, unless otherwise
indicated.

         2. GRANT OF UNITS. Pursuant to the Employment Agreement, Executive is
hereby granted, as of December 22, 2000, deferred compensation in the form of
1,250,000 (one million two hundred fifty thousand) Units pursuant to the terms
of this Agreement.

         3. DIVIDEND EQUIVALENTS. Executive shall be paid, on a quarterly basis
with respect to all outstanding Units (as such Units may be adjusted under
Section 6), dividend equivalent amounts equal to the regular quarterly cash
dividend payable to holders of Common Stock (to the extent regular quarterly
cash dividends are paid) as if Executive were an actual shareholder with respect
to the number of shares of Common Stock equal to his outstanding Units. Such
dividend equivalents shall be paid on the same date as the regular quarterly
cash dividend is paid by the Company in respect of the Common Stock.

         4. PAYMENTS OF UNITS.

                  (a) The shares of Common Stock underlying the Units (the "Unit
Shares") shall be paid out to Executive on January 1, 2006, if Executive is
still employed by the Company on December 31, 2005; provided, however, that
during the 20-year period ending June 30, 2025, Executive shall have the right
to defer the delivery of the Unit Shares on as many occasions as Executive
determines from time to time by giving written notice to the Company no less
than six months prior to the next scheduled delivery date for the Unit Shares
(but in no event shall Executive defer delivery of the Unit Shares beyond June
30, 2025). In the event Executive's employment with the Company terminates prior
to December 31, 2005 or a Change in Control occurs, the timing of the payment of
the Unit Shares shall be governed by the terms of the Employment Agreement.

                  (b) Any Unit Shares delivered shall be deposited in an account
designated by Executive and maintained at a brokerage house selected by
Executive. Any such Unit Shares shall be



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duly authorized, fully paid and non-assessable shares, listed with NASDAQ or
the principal United States securities exchange on which the Common Stock is
admitted to trading and registered on the Company Registration Statement, if
registration is requested by Executive.

                  (c) Except as otherwise provided in this Agreement, Executive
shall not be deemed to be a holder of any Common Stock pursuant to a Unit until
the date of the issuance of a certificate to him for such shares and, except as
otherwise provided in this Agreement, Executive shall not have any rights to
dividends or any other rights of a shareholder with respect to the shares of
Common Stock covered by a Unit until such shares of Common Stock have been
issued to him, which issuance shall not be unreasonably delayed.

                  (d) The Company may require that Executive pay to the Company,
or the Company may otherwise withhold, at the time of payment of the value of a
Unit, any such amount as is required by law or regulation to be withheld for
Federal, state or local income tax or any other taxes incurred by reason of the
payment.

                  (e) Executive's right to receive payment of any amounts under
this Agreement shall be an unfunded entitlement and shall be an unsecured claim
against the general assets of the Company.

                  (f) After payment in accordance with this Section 4, the Unit
Shares may not be sold, transferred or otherwise disposed of by Executive for a
period of five days after receipt of such shares by Executive, except that no
such restrictions shall apply in the case of a Change in Control or if Executive
determines to sell (or instruct the Company to withhold) any Unit Shares in
order to satisfy any obligations Executive may have with respect to any
applicable tax withholding requirements on receipt of Unit Shares.

         5. REPRESENTATIONS. The Company represents and warrants that this
Agreement has been authorized by all necessary action of the Company, has been
approved by the Board and is a valid and binding agreement of the Company
enforceable against it in accordance with its terms and that the Unit Shares
will be issued pursuant to and in accordance with the 2000 Plan, will be listed
with NASDAQ or the principal United States securities exchange on which the
Common Stock is admitted to trading, and will be validly issued, fully paid and
non-assessable shares. The Company further represents and warrants that the
grant of Units under this Agreement has been approved by the Company's Stock
Option Committee, that the 2000 Plan has and will have sufficient shares
available to effect the distribution of the Unit Shares, and that the Company
will file a Hart Scott Rodino application with respect to Executive on a timely
basis, if necessary, in connection with the acquisition of Unit Shares by
Executive under this Agreement.

         6. CHANGES IN THE COMMON STOCK AND ADJUSTMENT OF UNITS.

                  (a) In the event the outstanding shares of the Common Stock
shall be changed into an increased number of shares, through a share dividend or
a split-up of shares, or into a decreased number of shares, through a
combination of shares, then immediately after the record date for such change,
the number of Units then subject to this Agreement shall be proportionately
increased, in case of such share dividend or split-up of shares, or
proportionately decreased, in case of such combination of shares. In the event
the Company shall issue any of its shares of stock or other securities or
property (other than Common Stock which is covered by the preceding sentence),
in a reclassification of the Common Stock (including without limitation any such
reclassification in connection with a consolidation or merger in which the
Company is the continuing entity), the kind and number of Units subject to this
Agreement immediately prior thereto shall be adjusted so that the Executive
shall be entitled to receive


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the same kind and number of shares or other securities or property which the
Executive would have owned or have been entitled to receive after the
happening of any of the events described above, had he owned the shares of
the Common Stock represented by the Units under this Agreement immediately
prior to the happening of such event or any record date with respect thereto,
which adjustment shall become effective immediately after the effective date
of such event retroactive to the record date, if any, for such event.

                  (b) In the event the Company shall distribute to all holders
of the Common Stock evidences of its indebtedness or assets (including leveraged
recapitalizations with special cash distributions, but excluding regular
quarterly cash dividends), then in each case the number of Units thereafter
subject to this Agreement shall be determined by multiplying the number of Units
theretofore subject to this Agreement by a fraction, (i) the numerator of which
shall be the then current market price per share of Common Stock (as determined
in paragraph (c) below) on the record date for such distribution, and (ii) the
denominator of which shall be the then current market price per share of the
Common Stock less the then fair value (as mutually determined in good faith by
the Board and the Executive) of the portion of the assets or evidences of
indebtedness so distributed applicable to a share of Common Stock. Such
adjustment shall be made whenever any such distribution is made, and shall
become effective on the date of distribution retroactive to the record date for
the determination of shareholders entitled to receive such distribution.

                  (c) For the purpose of any computation under paragraph (b) of
this Section 6, the current market price per share of the Common Stock at any
date shall be deemed to be the average of the daily Stock Prices for 15
consecutive Trading Days commencing 20 Trading Days before the date of such
computation. "Stock Price" for each Trading Day shall be the "Fair Market Value"
of the Common Stock (as defined in the Company Stock Option Plan, as in effect
on the date of this Agreement) for such Trading Day. "Trading Day" shall be each
Monday, Tuesday, Wednesday, Thursday and Friday, other than any day on which the
Common Stock is not traded on the exchange or in the market which is the
principal United States market for the Common Stock.

                  (d) For the purpose of this Section 6, the term "Common Stock"
shall mean (i) the class of Company securities designated as the Common Stock at
the date of this Agreement, or (ii) any other class of equity interest resulting
from successive changes or reclassifications of such shares consisting solely of
changes in par value, or from par value to no par value, or from no par value to
par value. In the event that at any time, as a result of an adjustment made
pursuant to the second sentence of Section 6(a) above, the Executive shall
become entitled to Units representing any shares other than the Common Stock,
thereafter the number of such other shares represented by a Unit shall be
subject to adjustment from time to time in a manner and on the terms as nearly
equivalent as practicable to the provisions with respect to the shares contained
in this Section 6, and the provisions of this Agreement with respect to the
shares of Common Stock represented by the Units shall apply on like terms to any
such other shares.

                  (e) In case of any consolidation of the Company or merger of
the Company with another corporation as a result of which Common Stock is
converted or modified, or in case of any sale or conveyance to another
corporation of the property, assets and business of the Company as an entirety
or substantially as an entirety, the Company shall modify the Units so as to
provide the Executive with Units reflecting the kind and amount of shares and
other securities and property that he would have owned or have been entitled to
receive immediately after the happening of such consolidation, merger, sale or
conveyance had his Units immediately prior to such action actually been shares
and, if applicable, other securities of the Company represented by those Units.
The provisions of this Section 6(e) shall similarly apply to successive
consolidations, mergers, sales or conveyances.


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                  (f) If the Company distributes rights or warrants to all
holders of its Common Stock entitling them to purchase shares of Common Stock at
a price per share less than the current market price per share on the record
date for the distribution, the Company shall distribute to Executive equivalent
amounts of such rights or warrants as if Executive were an actual shareholder
with respect to the number of shares of Common Stock equal to his outstanding
Units. Such rights or warrants shall be exercisable at the same time, on the
same terms, and for the same price as the rights or warrants distributed to
holders of the Common Stock.

                  (g) In case any event shall occur as to which the provisions
of this Section 6 are not applicable but the failure to make any adjustment
would not fairly protect the rights represented by the Units in accordance with
the essential intent and principles of this Section 6 then, in each such case,
the Company shall make an adjustment, if any, on a basis consistent with the
essential intent and principles established in this Section 6, necessary to
preserve, without dilution, the rights represented by the Units. The Company
will promptly notify the Executive of any such proposed adjustment.

                  (h) Notwithstanding anything to the contrary contained herein,
the provisions of Section 6 shall not apply to, and no adjustment is required to
be made in respect of, any of the following: (i) the issuance of shares of
Common Stock upon the exercise of any other rights, options or warrants that
entitle the holder to subscribe for or purchase such shares (it being understood
that the sole adjustment pursuant to this Section 6 in respect of the issuance
of shares of Common Stock upon exercise of rights, options or warrants shall be
made at the time of the issuance by the Company of such rights, options or
warrants, or a change in the terms thereof); (ii) the issuance of shares of
Common Stock to the Company's employees, directors or consultants pursuant to
bona fide benefit plans adopted by the Company's Board; (iii) the issuance of
shares of Common Stock in a bona fide public offering pursuant to a firm
commitment offering; (iv) the issuance of shares of Common Stock pursuant to any
dividend reinvestment or similar plan adopted by the Company's Board to the
extent that the applicable discount from the current market price for shares
issued under such plan does not exceed 5%; and (v) the issuance of shares of
Common Stock in any arm's length transaction, directly or indirectly, to any
party.

                  (i) Notwithstanding anything in this Agreement to the
contrary, in the event of a spin-off by the Company to its shareholders,
Executive's participation in such spin-off with respect to the Units and the
adjustment of the Units shall be determined in an appropriate and equitable
manner, and it is the intention of the parties hereto that, to the extent
practicable, such adjustment shall include an equity interest in the spin-off
entity.

                  (j) In the event the parties hereto cannot agree upon an
appropriate and equitable adjustment to the Units, the services of an
independent investment banker mutually acceptable to Executive and the Company
shall (at the sole expense of the Company) be retained to determine an
appropriate and equitable adjustment, and such determination shall be binding
upon the parties.

         7. NO RIGHT TO EMPLOYMENT. Nothing in this Agreement shall confer upon
Executive the right to remain in employ of the Company or any subsidiary of the
Company.

         8. NONTRANSFERABILITY. This Agreement shall not be assignable or
transferable by the Company (other than to successors of the Company) and this
Agreement and the Units shall not be assignable or transferable by the Executive
otherwise than by will or by the laws of descent and distribution, and the Units
may be paid out during the lifetime of the Executive only to him. More
particularly, but without limiting the generality of the foregoing, the Units
may not be assigned, transferred (except as provided in the preceding sentence),
pledged, or hypothecated in any way (whether by operation of law or otherwise),
and shall not be subject to execution, attachment or similar process. Any
attempted assignment, transfer, pledge, hypothecation or other disposition of
the Units contrary to


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the provisions of this Agreement, and any levy of any attachment or similar
process upon the Units, shall be null and void and without effect.

         9. ARBITRATION, LEGAL FEES AND EXPENSES. If any contest or dispute
shall arise between the Company and Executive regarding any provision of this
Agreement, the Company shall reimburse Executive for all legal fees and expenses
reasonably incurred by Executive in connection with such contest or dispute,
pursuant to the provisions of Section 8.1 of the Employment Agreement. The
application of this Section 9 (and Section 8.1 of the Employment Agreement)
shall survive the termination of the Employment Agreement. Such reimbursement
shall be made as soon as practicable following the resolution of such contest or
dispute (whether or not appealed) to the extent the Company receives reasonable
written evidence of such fees and expenses. Any dispute or controversy arising
under or in connection with this Agreement, shall be settled exclusively by
arbitration in Wilmington, Delaware in accordance with the Commercial
Arbitration Rules of the American Arbitration Association then in effect.
Judgment may be entered on the arbitrator's award in any court having
jurisdiction.

         10. ENTIRE AGREEMENT. This Agreement and the Employment Agreement
contain all the understandings between the parties hereto pertaining to the
matters referred to herein, and supersede all undertakings and agreements,
whether oral or in writing, previously entered into by them with respect
thereto. The Executive represents that, in executing this Agreement, he does not
rely and has not relied upon any representation or statement not set forth
herein made by the Company with regard to the subject matter, basis or effect of
this Agreement or otherwise.

         11. AMENDMENT OR MODIFICATION; WAIVER. No provision of this Agreement
may be amended, modified or waived unless such amendment or modification is
agreed to in writing, signed by the Executive and by a duly authorized officer
of the Company, and such waiver is set forth in writing and signed by the party
to be charged. No waiver by any party hereto of any breach by another party
hereto of any condition or provision of this Agreement to be performed by such
other party shall be deemed a waiver of a similar or dissimilar condition or
provision at the same time, any prior time or any subsequent time.

         12. NOTICES. Any notice to be given hereunder shall be in writing and
shall be deemed given when delivered personally, sent by courier or telecopy or
registered or certified mail, postage prepaid, return receipt requested,
addressed to the party concerned at the address indicated below or to such other
address as such party may subsequently give notice of hereunder in writing:

                  To the Executive:
                  Stuart M. Essig
                  26 Coniston Court
                  Princeton, NJ 08540
                  Facsimile:  609-924-7264

                  To the Company:

                  Integra LifeSciences Holdings Corporation
                  311C Enterprise Drive
                  Plainsboro, NJ  08536
                  Attention:  Chairman
                  Facsimile:  609-799-3297

                  (with a copy to the Company's General Counsel)


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                  Any notice delivered personally or by courier under this
Section 12 shall be deemed given on the date delivered and any notice sent by
telecopy or registered or certified mail, postage prepaid, return receipt
requested, shall be deemed given on the date telecopied or mailed.

         13. SEVERABILITY. If any provision of this Agreement or the application
of any such provision to any party or circumstances shall be determined by any
court of competent jurisdiction to be invalid and unenforceable to any extent,
the remainder of this Agreement or the application of such provision to such
person or circumstances, other than those to which it is so determined to be
invalid and unenforceable, shall not be affected thereby, and each provision
hereof shall be validated and shall be enforced to the fullest extent permitted
by law.

         14. NONCONTRAVENTION. The Company represents that the Company is not
prevented from entering into, or performing, this Agreement by the terms of any
law, order, rule or regulation, its certificate of incorporation or by-laws, or
any agreement to which it is a party.

         15. SURVIVORSHIP. The respective rights and obligations of the parties
hereunder shall survive any termination of this Agreement or Executive's
employment to the extent necessary for the intended preservation of such rights
and obligations.

         16. SUCCESSORS. This Agreement shall inure to the benefit of and be
binding upon each successor of the Company, and upon the Executive's
beneficiaries, legal representatives or estate, as the case may be.

         17. GOVERNING LAW. This agreement will be governed by and construed in
accordance with the laws of the State of Delaware, without regard to its
conflicts of laws principles.

         18. HEADINGS. All descriptive headings of sections and paragraphs in
this Agreement are for convenience of reference only, and they form no part of
this Agreement and shall not affect its interpretation.

         19. COUNTERPARTS. This Agreement may be executed in counterparts, each
of which shall be deemed an original, but all of which together shall constitute
one and the same instrument.

                  IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the date first above written.

                                    INTEGRA LIFESCIENCES HOLDINGS CORPORATION


                                    By:/s/ Richard E. Caruso
                                       --------------------------
                                    Richard E. Caruso, Chairman

                                    /s/ Stuart M. Essig
                                    -----------------------------------
                                    STUART M. ESSIG

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