EXHIBIT
10.2


 


AMENDMENT
TO MANUFACTURING AGREEMENT


 


THIS AMENDMENT TO
MANUFACTURING AGREEMENT (“Amendment”)
is made and entered into as of September 30, 2008 (the “ Effective Date “),
by and between Osiris Therapeutics, Inc., a Delaware corporation (“ Osiris “), and
NuVasive, Inc., a Delaware corporation (“ NuVasive “):


 


RECITALS


 


WHEREAS, on May 8,
2008, Osiris and NuVasive entered into an Asset Purchase Agreement (the “Purchase Agreement “)
pursuant to which Osiris agreed to sell, and NuVasive agreed to purchase,
technology related to manufacturing the Osteocel product line (as more
specifically set forth therein), such sale and purchase taking place July 24,
2008;


 


WHEREAS, pursuant to the
Purchase Agreement, on July 24, 2008, Osiris and NuVasive entered into a
Manufacturing Agreement (the “ Manufacturing Agreement “) whereby Osiris agreed to
manufacture and deliver to NuVasive, and NuVasive agreed to purchase, the
Product (as defined therein); and


 


WHEREAS, Osiris and
NuVasive wish to amend certain sections of the Manufacturing Agreement to
reduce the purchase price and the minimum performance levels related to the
purchase and sale of the Product.


 


NOW, THEREFORE, in
consideration for the mutual covenants of the parties expressed herein, the
sufficiency of which consideration is acknowledged, it is agreed that the
Manufacturing Agreement is amended as of the Effective Date as follows:


 


AMENDMENT


 


	
  1.

  	
   

  	
  Defined Terms.
  Except as otherwise provided in this Amendment, capitalized terms will have
  the meanings assigned to them in the Manufacturing Agreement.

  
	
   

  	
   

  	
   

  
	
  2.

  	
   

  	
  Performance Levels.
  Sections 3.3.1 and 3.3.2 are hereby deleted in their entirety and
  replaced with the following:

  



 


3.1.1 Minimum
Performance Levels. Osiris shall use its commercially reasonable best efforts
to Deliver Product to NuVasive at least in the quantities set forth below
during the applicable periods ( “Minimum
Performance Levels” ) and shall Deliver any such Product according
to Product unit size and brand name specifications established by NuVasive and
set forth in each Order. NuVasive shall provide Orders to purchase from Osiris
Product in quantities of at least the Minimum Performance Level for the
applicable period.


 

















 


	
   

  	
   

  	
  Minimum Performance

  	
   

  
	
  Applicable Period

  	
   

  	
  Level Delivered (cc)

  	
   

  
	
  July 24,
  2008 to December 31, 2008

  	
   

  	
  95,000

  	
   

  
	
  January 1,
  2009 to April 15, 2009

  	
   

  	
  30,000

  	
   

  
	
  April 16,
  2009 to eighteen (18) months following the Technology Closing Date (as
  defined in the Asset Purchase Agreement)

  	
   

  	
  125,000

  	
   

  



 


3.3.2 Additional
Product.


 


(a) Osiris shall
have the right, in its discretion, to Process and Deliver Product hereunder in
quantities that exceed NuVasive’s Orders (the “Excess Quantities”), provided
that Osiris gives advance written notice to NuVasive of its intent to Process
and Deliver the Excess Quantities. Following receipt of such written notice,
the Parties shall discuss and attempt in good faith to reach agreement on the
unit sizes of the Excess Quantities. If the parties are unable to reach
agreement on the unit sizes of any Excess Quantities within ten (10) days
from the notice, Osiris shall Process and Deliver to NuVasive unit sizes of
such Excess Quantities in the same proportion as the unit sizes of Product set
forth in NuVasive’s most recent Order.


 


Subject to the notice and
sizing provisions immediately above, in addition to NuVasive’s requirement to
purchase from Osiris Product in quantities of at least the Minimum Performance
Level (provided that Osiris and/or its subcontractors Processes at least such
quantities) for the applicable period, NuVasive shall purchase from Osiris the
Excess Quantities, which together with the Minimum Performance Levels, shall
total between  ***  cubic centimeters and  ***  cubic centimeters in accordance with this
Agreement during the Term; provided, however , that NuVasive
shall have no obligation hereunder to purchase Product in quantities greater
than 
***  cubic centimeters,
and the Delivery and purchase of such greater quantities of Product, if any,
shall be by mutual written agreement of both parties. For all Product Processed
hereunder, Osiris shall provide NuVasive with a monthly forecast of projected
Product manufacturing quantities for such month.


 


(b) Notwithstanding
anything in the Agreement to the contrary, Osiris shall manufacture and make
available for delivery to NuVasive a minimum of 95,000 cubic centimeters of
Product between July 24, 2008 and December 31, 2008 and in no event
shall NuVasive be required to accept more than 95,000 cubic centimeters of
Product between July 24, 2008 and December 31, 2008, and all
authority to schedule shipments and receipt of Product shall be solely at
NuVasive’s discretion provided that it accepts at least 95,000 cubic
centimeters during the aforementioned period.


 






	
  ***

  	
   

  	
  Portions of this
  page have been omitted pursuant to a request for Confidential Treatment
  filed separately with the Commission.

  



 


2

















 


	
  3.

  	
   

  	
  Fees.
  Articles 4.1, 4.2 and 4.3 are hereby deleted in their entirety and replaced
  with the following:

  



 


4.1 Product Fees.
In consideration of the agreements contained herein as well as the agreements
contained in that certain Distribution Agreement, dated as of November 10,
2005, by and between Osiris and Blackstone Medical, Inc.( “Blackstone” ), as terminated by that
certain Termination and Release Agreement, dated a of September 30, 2008,
by and between Osiris and NuVasive on one hand, and Blackstone on the other
hand, NuVasive shall pay to Osiris  $ ***  per cubic centimeter of Product (“ Product Fees “) for the first 40,323 cubic
centimeters delivered to NuVasive since July 24, 2008 and that is not
timely rejected by NuVasive pursuant to Section 3.6 above; NuVasive shall
pay to Osiris $*** per cubic centimeter for Product deliveries in excess of
40,323 cubic centimeters. All payments due hereunder shall be made in U.S.
dollars, without set-off or counterclaim. For the avoidance of doubt, NuVasive
shall be responsible for paying to Osiris the Product Fee for all conforming
Product that is delivered to NuVasive as a replacement of Product rejected in
accordance with Section 3.6 to the extent that payment for such Product
was not previously made.


 


4.2 Adjustments to
Product Fees. The Product Fees shall be escalated on January 1, 2009
to an amount equal to
$*** per cubic centimeter, plus an increase to reflect the then
current Consumer Price Index (“ CPI
“). Adjustments to Product Fees shall be effective January 1st  and shall apply to all shipments of Product
made on or after January 1st.


 


4.3 Billing. Inventory
delivery to NuVasive shall be billed Cash-On-Delivery (“COD”). NuVasive shall
pay to Osiris the Product Fees, by wire transfer of immediately available funds
to an account designated in writing by Osiris, each month prior to the close of
business on the last day of the month in which the Product was received. In the
event that NuVasive fails to pay in accordance with Section 4.3, Osiris
may, in addition to any other remedies available to it, assess interest at a
rate of one and one-half percent (1.5%) per month on all unpaid amounts.


 


	
  4.

  	
   

  	
  Full Force and Effect.
  Except as set forth in this Amendment, the Manufacturing Agreement shall
  continue unmodified and in full force and effect.

  
	
   

  	
   

  	
   

  
	
  5.

  	
   

  	
  Counterparts.
  This Amendment may be executed in any number of counterparts, all of which
  shall be deemed one original and complete instrument.

  



 






	
  ***

  	
   

  	
  Portions of this
  page have been omitted pursuant to a request for Confidential Treatment
  filed separately with the Commission.

  



 


3

















 


 


IN WITNESS WHEREOF, the
parties have executed this Amendment to Manufacturing Agreement as of the date
first set forth above.


 


	
  OSIRIS
  THERAPEUTICS, INC.

  	
  NUVASIVE,
  INC.

  
	
   

  	
   

  
	
  By:

  	
  /s/ Philip R. Jacoby
  Jr.

  	
   

  	
  By:

  	
  /s/ Alexis Lukianov

  
	
   

  	
  Name:

  	
  Philip R. Jacoby Jr.

  	
  Name:

  	
  Alexis Lukianov

  
	
  Its:

  	
  Vice President of
  Finance

  	
  Its:

  	
  Chairman & CEO