**EXHIBIT10.2**

 

**AMENDMENTTO MANUFACTURING AGREEMENT**

 

THIS AMENDMENT TOMANUFACTURING 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*** “), andNuVasive, 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 morespecifically set forth therein), such sale and purchase taking place July 24,2008;

 

WHEREAS, pursuant to thePurchase Agreement, on July 24, 2008, Osiris and NuVasive entered into aManufacturing Agreement (the “***Manufacturing Agreement*** “) whereby Osiris agreed tomanufacture and deliver to NuVasive, and NuVasive agreed to purchase, theProduct (as defined therein); and

 

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

 

NOW, THEREFORE, inconsideration for the mutual covenants of the parties expressed herein, thesufficiency of which consideration is acknowledged, it is agreed that theManufacturing 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. |
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|   |   |                                                                                                                                                       |
| 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 MinimumPerformance Levels. Osiris shall use its commercially reasonable best effortsto Deliver Product to NuVasive at least in the quantities set forth belowduring the applicable periods (**“MinimumPerformance Levels”** ) and shall Deliver any such Product accordingto Product unit size and brand name specifications established by NuVasive andset forth in each Order. NuVasive shall provide Orders to purchase from OsirisProduct in quantities of at least the Minimum Performance Level for theapplicable period.

 

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| ** **                                                                                                                            | ** ** | **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 AdditionalProduct.

 

(a) Osiris shallhave the right, in its discretion, to Process and Deliver Product hereunder inquantities that exceed NuVasive’s Orders (the “Excess Quantities”), providedthat Osiris gives advance written notice to NuVasive of its intent to Processand Deliver the Excess Quantities. Following receipt of such written notice,the Parties shall discuss and attempt in good faith to reach agreement on theunit sizes of the Excess Quantities. If the parties are unable to reachagreement on the unit sizes of any Excess Quantities within ten (10) daysfrom the notice, Osiris shall Process and Deliver to NuVasive unit sizes ofsuch Excess Quantities in the same proportion as the unit sizes of Product setforth in NuVasive’s most recent Order.

 

Subject to the notice andsizing provisions immediately above, in addition to NuVasive’s requirement topurchase from Osiris Product in quantities of at least the Minimum PerformanceLevel (provided that Osiris and/or its subcontractors Processes at least suchquantities) for the applicable period, NuVasive shall purchase from Osiris theExcess Quantities, which together with the Minimum Performance Levels, shalltotal between ** *****  cubic centimeters and**  *****  cubic centimeters in accordance with thisAgreement during the Term; provided, however , that NuVasiveshall have no obligation hereunder to purchase Product in quantities greaterthan** *****  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 Processedhereunder, Osiris shall provide NuVasive with a monthly forecast of projectedProduct manufacturing quantities for such month.

 

(b) Notwithstandinganything in the Agreement to the contrary, Osiris shall manufacture and makeavailable for delivery to NuVasive a minimum of 95,000 cubic centimeters ofProduct between July 24, 2008 and December 31, 2008 and in no eventshall NuVasive be required to accept more than 95,000 cubic centimeters ofProduct between July 24, 2008 and December 31, 2008, and allauthority to schedule shipments and receipt of Product shall be solely atNuVasive’s discretion provided that it accepts at least 95,000 cubiccentimeters during the aforementioned period.

 

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

 

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** **
| 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 agreementscontained in that certain Distribution Agreement, dated as of November 10,2005, by and between Osiris and Blackstone Medical, Inc.(**“Blackstone”** ), as terminated by thatcertain Termination and Release Agreement, dated a of September 30, 2008,by and between Osiris and NuVasive on one hand, and Blackstone on the otherhand, NuVasive shall pay to Osiris**  $*********  per cubic centimeter of Product (“**Product Fees** “) for the first 40,323 cubiccentimeters delivered to NuVasive since July 24, 2008 and that is nottimely rejected by NuVasive pursuant to Section 3.6 above; NuVasive shallpay to Osiris $*** per cubic centimeter for Product deliveries in excess of40,323 cubic centimeters. All payments due hereunder shall be made in U.S.dollars, without set-off or counterclaim. For the avoidance of doubt, NuVasiveshall be responsible for paying to Osiris the Product Fee for all conformingProduct that is delivered to NuVasive as a replacement of Product rejected inaccordance with Section 3.6 to the extent that payment for such Productwas not previously made.

 

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

 

4.3 Billing. Inventorydelivery to NuVasive shall be billed Cash-On-Delivery (“***COD***”). NuVasive shallpay to Osiris the Product Fees, by wire transfer of immediately available fundsto an account designated in writing by Osiris, each month prior to the close ofbusiness on the last day of the month in which the Product was received. In theevent that NuVasive fails to pay in accordance with Section 4.3, Osirismay, in addition to any other remedies available to it, assess interest at arate 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. |
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| 5.     |   | Counterparts.  This Amendment may be executed in any number of counterparts, all of which  shall be deemed one original and complete instrument.    |

 

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

 

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IN WITNESS WHEREOF, theparties have executed this Amendment to Manufacturing Agreement as of the datefirst 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 |
|                                |                            |  |  |  |  |  |

 

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