**EXHIBIT 10.2**

 

**AMENDMENT NO. 2 TO ASSET PURCHASE AGREEMENT**

 

This**AMENDMENTNO. 2 TO ASSET PURCHASE AGREEMENT** (this “***SecondAmendment***”), dated as of March 25, 2009, is by and between **OSIRIS THERAPEUTICS, INC.**, a Delaware corporation (“***Seller***”), and **NUVASIVE,INC.**, a Delaware corporation (“***Purchaser***”).  Capitalized terms used herein and nototherwise defined shall have the meaning given them in that certain AssetPurchase Agreement by and between Seller and Purchaser dated May 8, 2008,as amended pursuant to that certain Amendment to Asset Purchase Agreement byand between Seller and Purchaser dated September 30, 2008 (collectively,the “***Agreement***”).  Seller and Purchaser shall each be referredto herein as a “***Party***” and collectively asthe “***Parties***.”

 

**WHEREAS**, pursuant to Section 9.3 of the Agreement, theAgreement may be amended by a written instrument signed by the parties to theAgreement; and

 

**NOW, THEREFORE**, in consideration of the foregoing, theagreements hereinafter set forth and for other good and valuable consideration,the receipt and sufficiency of which are hereby acknowledged, the Parties agreeas follows:

 

1.                                       Amendments.

 

(a)                                   Section 1.1(a)(ii) of theAgreement shall be deleted in its entirety.

 

(b)                                  Section 1.3 of the Agreement shallbe amended by deleting in its entirety the second sentence thereof andinserting in its place the following:

 

“The consummation of theManufacturing Asset Transfer (the “Manufacturing Closing”) shall be heldon the fifteenth day following the execution by Purchaser and Seller of thisSecond Amendment (the “Manufacturing Closing Date”) and at such time allconditions to the Manufacturing Closing shall be deemed to have been waived orsatisfied.  In connection with theManufacturing Closing, either (a) the Purchaser shall assume that certainAmended and Restated Tissue Procurement Processing and Supply Agreement by andbetween Seller and AlloSource, dated February 1, 2008 (the “AlloSourceSupply Agreement”) or (b) the AlloSource Supply Agreement shall be amended,modified, supplemented or terminated.”

 

(c)                                  Section 1.5(a) of the Agreementshall be amended and restated in its entirety, as follows:

 

### **“(a)**                            Milestones; MilestonePayments.  From and after theTechnology Closing Date, in addition to the consideration set forth in Section 1.4above, Purchaser shall, with respect to Sections 1.5(a)(i) and 1.5(a)(vi) below,subject to, and contingent upon achievement of the post-Technology Closingperformance milestones of the Business set forth in Sections 1.5(a)(i) and1.5(a)(vi) below, and, with respect to Sections 1.5(a)(ii), 1.5(a)(iii) and1.5(a)(iv) below, on the dates set forth in Sections 1.5(a)(ii), 1.5(a)(iii) and1.5(a)(iv) below (each, a “Milestone”) not later than theapplicable date for satisfaction of each Milestone set forth below (each a 

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### **“MilestoneExpiration Date”), pay to Seller an amount of cash (in United Statesdollars of immediately available funds) or common stock, par value $0.001 pershare, of Purchaser (“Purchaser Common Stock”) (the form of payment ofwhich is to be determined in the sole discretion of Purchaser), equal to theFirst Milestone Payment, Second Milestone Payment, Third Milestone Payment,Fourth Milestone Payment, Fifth Milestone Payment and/or Sixth MilestonePayment, as applicable (the “Applicable Milestone Payment”) and eachMilestone shall be independent of each other Milestone and may be satisfied andpayment become due therefore regardless of non-satisfaction of any otherMilestone; provided, however, that (i) if Purchaser electsto issue shares of Purchaser Common Stock in respect of any ApplicableMilestone Payment, then prior to such issuance and upon request by thePurchaser, Seller shall deliver to Purchaser such representations andwarranties as Purchaser shall reasonably request for purposes of exempting theissuance of such shares from the registration requirements of the SecuritiesAct, and (ii) if Purchaser elects to issue shares of Purchaser CommonStock in respect of any Applicable Milestone Payment, the number of shares ofPurchaser Common Stock to be issued shall be equal to the Applicable MilestonePayment divided by the Purchaser Common Stock Value.  The obligations of Purchaser under this Section 1.5(a) aresubject to the provisions of Section 1.5(c) below (regarding Purchaser’sRights of Set-Off).  For avoidance ofdoubt, in no event shall the sum of all Applicable Milestone Payments made byPurchaser to Seller under this Section 1.5 exceed Fifty Million Dollars($50,000,000) (the “Maximum Milestone Amount.**

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##### ***(i)***                                     If at any time following the Technology Closing Datebut at or prior to April 15, 2009, Seller shall have delivered toPurchaser an aggregate of 75,000 cubic centimeters of Product (the “FirstDelivery Threshold”) in accordance with the terms and provisions of, and subjectto the specifications set forth in, the Manufacturing Agreement, Purchasershall pay to Seller Five Million Dollars ($5,000,000) (the “First MilestonePayment”).  The parties acknowledgeand agree that the First Milestone Payment was previously made by Purchaser andthat no further amount shall be due or owing with respect thereto.

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##### ***(ii)***                                  Purchaser shall pay to Seller Five Million Dollars($5,000,000) on the date that Purchaser executes the Second Amendment (the “SecondMilestone Payment”).

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##### ***(iii)***                               Purchaser shall pay to Seller Twelve Million FiveHundred Thousand Dollars ($12,500,000) on June 30, 2009 (the “ThirdMilestone Payment”).

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##### ***(iv)***                              Purchaser shall pay to Seller Twelve Million FiveHundred Thousand Dollars ($12,500,000) on September 30, 2009 (the “FourthMilestone Payment”).

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##### ***(v)***                                 [IntentionallyOmitted].

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##### ***(vi)***                              If at any time following the Technology Closing Datethe Business shall generate Thirty-Five Million Dollars ($35,000,000) incumulative Net Sales (the “Net Sales Threshold”), Purchaser shall pay toSeller Fifteen Million Dollars ($15,000,000) (the “Sixth Milestone Payment”).

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If any payment under this Section 1.5(a) ismade in the form of Purchaser Common Stock, then on the date of such paymentPurchaser shall provide to Seller (I) a certificate from a 

 

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duly authorized officer of Purchaser certifying thatas of the date of such issuance (x) the Purchaser Common Stock so issuedhas been duly authorized and is validly issued, fully-paid and non-assessableand, (y) the provisions of Rule 144(c) of the Securities Act,are satisfied and (II) a legal opinion from Purchaser’s legal counsel thatsuch Purchaser Common Stock has been duly authorized and validly issued, isfully paid and non-assessable.  IfPurchaser is unable to satisfy the requirement set forth in the immediatelypreceding sentence, Seller shall be under no obligation to accept PurchaserCommon Stock as payment for the Applicable Milestone Payment and Purchasershall make such Applicable Milestone Payment in the form of cash, in UnitedStates dollars of immediately available funds.”

 

### **(d)**                                 Sections 6.1 (a), (b),and (d-i) of the Agreement shall be deleted in their entirety, and Sellerhereby specifically affirms that the representations and warranties in Section 6.1(c) thereofare true and correct as of the date hereof.

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(e)                                  Section 8.2(d) ofthe Agreement shall be amended by adding at the end thereof the followingphrase “ ... and all liabilities associated with the assumption or termination ofthe AlloSource Supply Agreement as contemplated by the Second Amendment.”

 

(f)                                     Section 9.13of the Agreement shall be amended by deleting the definitions of “AllowableWork in Process” and “WIP Value” in their entirety.  In addition, the Index of Defined Termscontained in Section 9.13 shall be amended by eliminating the reference toWork in Process contained therein.

 

2.                                       ColumbiaFacility. Notwithstanding anything to the contrary in the Agreement (or anyexhibit or schedule to the Agreement), the Parties agree that Seller shall nottransfer, lease or sub-lease the 7015 Albert Einstein, Columbia Marylandfacility (the “***Columbia Facility***”) toPurchaser, and Purchaser shall have no obligation to lease or sub-lease theColumbia Facility.  The Parties agreethat (i) the Sublease Agreement by and between Broadwing Corporation andOsiris, dated June 2, 2006 and the Agreement of Lease by and betweenColumbia Gateway S-18, L.L.C. and Osiris, dated June 6, 2006 shall not beAssumed Contracts (as defined in the Agreement) pursuant to the Agreement, and (ii) Schedule1.1(a)(x) to the Agreement shall be amended to remove the SubleaseAgreement by and between Broadwing Corporation and Osiris, dated June 2,2006 and the Agreement of Lease by and between Columbia Gateway S-18, L.L.C.and Osiris, dated June 6, 2006****from suchSchedule 1.1(a)(x) to the Agreement. Purchaser agrees to timely dispose, at Purchaser’s cost, of all of theassets at the Columbia Facility set forth on Exhibit A attached to thisSecond Amendment.

 

3.                                       No FurtherAmendment.  Except tothe extent expressly modified by this Amendment, all of the provisions of theAgreement shall remain in full force and effect, without modification oramendment and are ratified in all respects. This Amendment is limited by its terms and does not and shall not serveto amend or waive any provision of the Agreement except as expressly providedfor in this Amendment.

 

4.                                       Governing Law;General Provisions.  ThisAmendment, including the validity hereof and the rights and obligations of theparties hereunder, shall be construed, interpreted, enforced and governed byand under the laws of the State of Delaware applicable to contracts

 

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made and to be performed entirely in suchstate, without regard to its rules regarding conflicts of law provisions.

 

5.                                       Counterparts,Facsimile Execution.  ThisAmendment may be executed in any number of counterparts, each of which shallconstitute an original but all of which shall constitute one and the sameinstrument.  The Parties need not signthe same counterpart.

 

**[Signature Page toFollow]**

 

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**IN WITNESS WHEREOF**, Seller andPurchaser have each caused this Amendment No. 2 to Asset PurchaseAgreement to be executed by their respective duly authorized officers, all asof the date first above written.

 

 
| **SELLER**:    |
|----------------|
| ** **     | ** ** |
| ** **     | **OSIRIS  THERAPEUTICS, INC.** |
|           |   |   |
|           | By: | /s/  Richard W. Hunt |
|           |   |   |
|           | Name: | Richard  W. Hunt |
|           |   |   |
|           | Title: | Chief  Financial Officer |
|           |   |   |
| ** **     |
| **PURCHASER**: |
| ** **     | ** ** |
| ** **     | **NUVASIVE,  INC.** |
|           |   |   |
|           | By: | /s/  Jason Hannon |
|           |   |   |
|           | Name: | Jason  Hannon |
|           |   |   |
|           | Title: | Senior  Vice President, General Counsel and Secretary |

 

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