Document:

<PAGE>

                                                                    Exhibit 10.5

Confidential Treatment. The portions of this exhibit that have been replaced
with "[*****]" have been filed separately with the Securities and Exchange
Commission and are the subject of a request for confidential treatment.

================================================================================

                          MANAGEMENT SERVICES AGREEMENT

                                     BETWEEN

                   UNIVERSITY OF FLORIDA TISSUE BANK, INC. AND

                            SOFAMOR DANEK GROUP, INC.

================================================================================

[CONFIDENTIAL]
<PAGE>

                          MANAGEMENT SERVICES AGREEMENT

                                TABLE OF CONTENTS

ARTICLE I COMMITMENTS AND LICENSES ........................................  -2-
       Section 1.1 Exclusive Commitments ..................................  -2-
       Section 1.2 License of UFTB Marks ..................................  -2-

ARTICLE II UFTB PRODUCTS ..................................................  -3-
       Section 2.1 UFTB Product Specifications ............................  -3-
       Section 2.2 UFTB Products Warranties ...............................  -4-
       Section 2.3 Processing Capacity ....................................  -5-

ARTICLE III MANAGEMENT SERVICES IN CONNECTION WITH UFTB PRODUCTS ..........  -5-
       Section 3.1 Danek's Management Services on Behalf of UFTB ..........  -5-
       Section 3.2 Ordering and Shipping Procedures .......................  -9-
       Section 3.3 Initial Exclusivity Fees Paid by Danek ................. -13-
       Section 3.4 Management Services Fees to be Paid by UFTB ............ -13-
       Section 3.5 Packaging Specifications ............................... -17-
       Section 3.6 Delivery; Right to Use ................................. -18-
       Section 3.7 Rejected Product ....................................... -18-
       Section 3.8 Taxes .................................................. -20-

ARTICLE IV CERTAIN AGREEMENTS OF UFTB AND DANEK ........................... -21-
       Section 4.1 Inspections ............................................ -21-
       Section 4.2 Regulatory Filings ..................................... -21-
       Section 4.3 Ownership of Intellectual Property Rights .............. -21-
       Section 4.4 Rights of First Refusal ................................ -22-

ARTICLE V TERM AND TERMINATION ............................................ -22-
       Section 5.1 Term ................................................... -22-
       Section 5.2 Early Termination ...................................... -22-
       Section 5.3 Accrued Obligations .................................... -23-

                                       (i)
<PAGE>

ARTICLE VI INDEMNIFICATION ................................................ -23-
       Section 6.1 Indemnification by Danek ............................... -23-
       Section 6.2 Indemnification By UFTB ................................ -23-
       Section 6.3 Survival of Obligations ................................ -24-

ARTICLE VII MISCELLANEOUS ................................................. -24-
       Section 7.1 Entire Agreement ....................................... -24-
       Section 7.2 Amendments ............................................. -24-
       Section 7.3 Governing Law; Jurisdiction ............................ -24-
       Section 7.4 Force Majeure .......................................... -24-
       Section 7.5 Severability ........................................... -25-
       Section 7.6 Waiver ................................................. -25-
       Section 7.7 No Third Party Beneficiaries ........................... -26-
       Section 7.8 Notices ................................................ -26-
       Section 7.9 Assignment ............................................. -27-
       Section 7.10 Headings .............................................. -27-
       Section 7.11 Counterparts .......................................... -27-

Schedule A      CURRENT PRODUCTS
Schedule 2.1    SPECIFICATIONS FOR UFTB PRODUCTS
Schedule 2.3    PROCESSING CAPACITY
Schedule 3.4(d) FULL PROCESSING COSTS

                                      (ii)
<PAGE>

                          MANAGEMENT SERVICES AGREEMENT

      THIS MANAGEMENT SERVICES AGREEMENT (this "Agreement") effective July 23,
1996, by and between THE UNIVERSITY OF FLORIDA TISSUE BANK, INC. ("UFTB"), a
Florida non-profit corporation, and SOFAMOR DANEK GROUP, INC., an Indiana
corporation ("Danek").

                              W I T N E S S E T H:

      WHEREAS, UFTB is a Direct Support Organization of The University Of
Florida.

      WHEREAS, UFTB's role as a Direct Support Organization of The University of
Florida will be significantly enhanced through the relationship with Danek as
agreed herein.

      WHEREAS, UFTB and Danek each acknowledge that the processing and use of
human tissue for human transplantation purposes is in the public interest and in
the interest of medicine generally and that the entering into of this Agreement
will enhance these interests through facilitating the availability of processed
allograft bone and/or tissue for use in spinal and cranial medical procedures
and thereby advancing the medical and scientific application thereof.

      WHEREAS, UFTB and Danek each desire that UFTB (i) process allograft bone
and/or tissue for use in spinal and cranial medical procedures (the "Current
Products") and future line extensions of the Current Products (together, the
"CFTB Products") and (ii) distribute such UFTB Products in conjunction with
exclusive worldwide management services provided by Danek, all in accordance
with the terms and subject to the conditions contained herein. A list of all
Current Products is set forth on the attached Schedule A.

      WHEREAS, UFTB and Danek each desire that all UFTB Products processed for
distribution throughout the world (the "Territory") shall be subject to Danek's
management services.
<PAGE>

      NOW, THEREFORE, in consideration of the premises and the mutual agreements
contained herein, Danek and UFTB hereby agree as follows:

                                    ARTICLE I

                             COMMITMENTS AND LICENSE

      Section 1.1 Exclusive Commitments. UFTB hereby agrees to exclusively
permit Danek to perform Management Services (as defined in Section 3.1 hereof)
in connection with all UFTB Products processed and distributed by UFTB in the
Territory, and Danek hereby agrees to perform Management Services in connection
with all UFTB Products processed and distributed by UFTB in the Territory,
subject to the terms and conditions of this Agreement.

      Section 1.2 License of UFTB Marks. During the term of this Agreement, UFTB
grants to Danek a royalty-free, non-transferable license to use the mark
"University of Florida Tissue Bank" (the "UFTB Mark") in the Territory in
connection with Danek's provision of Management Services.

                                      -2-
<PAGE>

                                   ARTICLE II

                                  UFTB PRODUCTS

      Section 2.1 UFTB Product Specifications. All Current Products to be
distributed by UFTB using Danek's Management Services (as defined in Section 3.1
hereof) shall conform to and otherwise comply with the specifications set forth
in Schedule 2.1 hereto, as such Schedule 2.1 may be amended from time to time by
mutual written agreement of the parties (the "UFTB Product Specifications"). If
any UFTB Product that is not a Current Product is distributed by UFTB pursuant
to this Agreement, the parties hereto shall negotiate in good faith to amend
Schedule 2.1 as provided in the preceding sentence to set forth the
specifications for such UFTB Product, and such UFTB Product shall conform to and
otherwise comply with the UFTB Product Specifications. If regulatory approval is
found to be required for any part or all of the UFTB Product Specifications in
any country located in the Territory and should such regulatory approval be
refused, modified or withdrawn by the applicable regulatory authorities in the
Territory, UFTB shall promptly notify Danek of such refusal, modification or
withdrawal and the parties shall negotiate in good faith to amend appropriately
the UFTB Product Specifications; provided, however, that in the event of any
such refusal, modification or withdrawal, UFTB may refuse to process or
distribute the affected UFTB Product, and/or Danek may refuse to provide
Management Services in connection with such UFTB Product, pending the resolution
of such regulatory matter. In the event of any such refusal, modification or
withdrawal, UFTB shall use its best efforts to favorably and promptly resolve
such regulatory matter, which best efforts shall include, but not be limited to,
full communication to Danek of all information and correspondence, except for
materials subject to the attorney-client

                                      -3-
<PAGE>

privilege, relating to any issues raised by such refusal, modification or
withdrawal and full participation with Danek in connection with the resolution
of such regulatory matter.

      Section 2.2 UFTB Products Warranties.

      (a) Compliance With Laws and Specifications. UFTB warrants that the UFTB
Products will be processed, packaged, stored and shipped (i) biomechanically
suitable for use in cranial and spinal medical procedures in which human tissue
is needed to replace human tissue and (ii) in conformity in all respects with
all applicable federal, state and local laws, rules and regulations relating
thereto, including particularly the Federal Food, Drug and Cosmetic Act and the
National Organ Transplant Act, the Guidelines of the American Association of
Tissue Banks (the "Guidelines") and the UFTB Product Specifications pursuant to
Section 2.1 hereof UFTB warrants that the packaging of UFTB Products will be in
conformity in all respects with the Packaging Specifications described in
Section 3.5 hereof.

      (b) Authority; Licenses. UFTB further warrants that it is fully authorized
to enter into and perform this Agreement, that the UFTB Products and any manuals
prepared by UFTB in connection with the UFTB Products and made available to
recipients of the UFTB Products (the "UFTB Customers") will not violate or
infringe upon any common law or statutory rights of any third party, and that
UFTB is the owner of all rights in and to the UFTB Mark. To the extent that UFTB
has proprietary rights in any form of intellectual property that may relate to
the performance of the Management Services by Danek, UFTB grants a non-exclusive
license with respect to such rights so as to permit all such activity. This
express license grant shall not be construed to limit implied licenses otherwise
granted to Danek or UFTB's customers under applicable law.

                                      -4-
<PAGE>

      (c) Incorporated Materials. UFTB warrants that it has full right and
authority to incorporate all materials (e.g., human tissue) into the UFTB
Products and that such raw materials shall be in full compliance with all
applicable federal, state and local laws, rules and regulations, the Guidelines
and with the UFTB Product Specifications.

      Section 2.3 Processing Capacity.

      (a) UFTB Current Products. Schedule 2.3 sets forth UFTB's current as well
as projected processing capacity for each of the Current Products by UFTB, in
terms of the number of units that may be processed, packaged and delivered by
UFTB per month. The projected processing capacity shows UFTB's anticipated
expanded process capacity after upgrading its processing systems upon receipt of
the Initial Exclusivity Fee pursuant to Section 3.3 hereof.

      (b) Other UFTB Products. If any UFTB Product that is not a Current Product
is processed pursuant to this Agreement, the parties hereto shall amend Schedule
2.3 by mutual agreement to set forth the information required by Section 2.3(a)
with respect to such product, and using, to the extent reasonably practicable
and appropriate, the capacity information with respect to the Current Product as
to which such product is an extension.

                                   ARTICLE III

              MANAGEMENT SERVICES IN CONNECTION WITH UFTB PRODUCTS

      Section 3.1 Danek's Management Services on Behalf of UFTB.

      (a) Danek's Rights and Responsibilities. Danek shall have the exclusive
responsibility to facilitate the distribution of the UFTB Products to UFTB
Customers in accordance with this Agreement (the "Management Services"). The
Management Services shall be comprised of (i) the

                                      -5-
<PAGE>

installation of computer hardware and Danek's proprietary software at UFTB's
Alachua, Florida facility (the "UFTB Facility") that will facilitate the
transfer of information concerning the UFTB Products between the parties (the
"UFTB Product System"), which UFTB Product System shall be subject to Danek's
standard license agreement, (ii) the provision, either through employees, or
agents of Danek of customer service to UFTB Customers (e.g., responding to
questions UFTB customers may have concerning how the UFTB Products were
processed and the various surgical applications for which they are designed),
(iii) the facilitation of the shipment of UFTB Products to UFTB Customers in
accordance with Sections 3.1(c) and 3.2 hereof and (iv) the marketing of the
aforementioned Management Services, which marketing may be combined with
marketing for separate Danek product lines and services; provided, however, that
the UFTB Products will be distributed by UFTB separately from any Danek
distributed products. Upon mutual agreement of the parties and subject to
separate written agreements, Danek may also provide UFTB Product design,
professional management information system and computer programming and
installation Support services. Danek reserves the right to develop, at its sole
discretion, non-exclusive management arrangements for the UFTB Products with
selected third parties which third parties will provide Management Services
subject to all of the covenants made by Danek hereunder.

      (b) Market Opportunity Estimates.

            (i) Quarterly Forecast Dates. Each September 15, December 15, March
15 and June 15 shall be a "Quarterly Forecast Date."

            (ii) Forecasts. To assist UFTB in estimating market opportunities
for UFTB Products, Danek will on each Quarterly Forecast Date, beginning with
[June 15, 1996], provide to

                                      -6-
<PAGE>

UFTB a forecast of its estimate of the number of units of UFTB Products that
will be obtained by UFTB Customers in the Territory including the following
information:

            (A)   a monthly forecast for each month of the three-month period
                  (months one, two and three) beginning with the month following
                  the month in which the forecast is delivered (the "First Three
                  Months Forecast") setting forth Danek's estimate of the
                  quantity of units of each UFTB Product for which a market
                  opportunity exists in each month covered by the forecast;

            (B)   a quarterly forecast for the three-month period (months four,
                  five and six) following the months covered in the First Three
                  Months Forecast (the "Second Quarter Forecast") setting forth
                  Danek's estimate of the quantity of units of each UFTB Product
                  for which a market opportunity exists in the quarter covered
                  by the forecast;

            (C)   a quarterly forecast for the three-month period (months seven,
                  eight and nine) following the quarter covered in the Second
                  Quarter Forecast (the "Third Quarter Forecast") setting forth
                  Danek's estimate of the quantity of units of each UFTB Product
                  for which a market opportunity exists in the quarter covered
                  by the forecast; and

            (D)   a quarterly forecast for the three-month period (months ten,
                  eleven and twelve) following the quarter covered in the Third
                  Quarter Forecast (the "Fourth Quarter Forecast") setting forth
                  Danek's estimate of the quantity of units of each UFTB Product
                  for which a market opportunity exists in the quarter covered
                  by the forecast.

      UFTB shall be required to provide to UFTB Customers 100% of the quantity
of the requirements of each UFTB Product forecasted for each month of the First
Three Months Forecast. The quantity of UFTB Products set forth in the Second
Quarter Forecast, the Third Quarter Forecast and the Fourth Quarter Forecast,
shall be for informational purposes only and shall not bind the parties in any
way; provided, that UFTB shall use its best efforts to supply quantities of UFTB
Product required by UFTB Customers in excess of quantities set forth in the
forecasts.

            (iii) UFTB's Non-Compliance with Forecast. UFTB shall notify Danek
within five (5) days of discovery that it will be unable to supply the number of
units of UFTB Products that

                                      -7-
<PAGE>

Danek forecasted under any First Three Months Forecast. In such case, UFTB will
assist Danek to develop or find an alternate source of the affected UFTB Product
for the time period during which UFTB is unable to supply the affected UFTB
Product.

      (c) Procedures for Receiving UFTB Customer Instructions. Danek shall be
responsible for receiving UFTB Customers' shipping instructions containing
shipping requirements for the UFTB Products sought to be obtained by such UFTB
Customers (the "UFTB Customer Instructions") throughout the Territory in
accordance with Section 3.2 hereof UFTB will maintain records of its transfers
of the UFTB Products in accordance with generally accepted accounting
principles.

      (d) Distribution of UFTB Products. Danek will use its best efforts to
actively support the distribution and use of the UFTB Product consistent with
Danek's standards. Danek shall offer commission rates to Danek's agents and
independent representatives with respect to the UFTB Products distributed to
UFTB Customers as the result of Danek's Management Services hereunder equal to
or greater than the commission rates offered to such agents and independent
representatives on any product that Danek may then be marketing that is deemed
by Danek to be a device that competes with the UFTB Products, it being
understood that any device that is listed in Danek's current catalogue is not a
device that competes with the UFTB Products.

      (e) No Warranties. In connection with its provision of Management
Services, Danek agrees that it will give no warranties or representations as to
the UFTB Products on behalf of UFTB, including without limitation, as to
quality, durability, merchantability, fitness for a particular use or purpose or
any other features of the UFTB Products being distributed by UFTB pursuant to
UFTB Customer Instructions. To ensure Danek's compliance with this Section
3.1(e), Danek shall, prior to publication, deliver, for UFTB's review,
advertising or other materials associated with the

                                      -8-
<PAGE>

distribution of the UFTB Products or the use of the UFTB Mark or the
relationship between Danek and UFTB or The University of Florida and Danek and
not previously published by Danek. If UFTB responds within forty eight (48)
hours (excluding weekends and holidays) of UFTB's receipt of such proposed
materials with reasonable requests for amending the materials to ensure Danek's
compliance with this Section 3.1(e) or with an appropriate description of
Danek's relationship between UFTB or The University of Florida, Danek shall
endeavor to incorporate those changes. If UFTB either approves the materials or
fails to respond within forty-eight (48) hours of receipt of the materials
sought to be approved, Danek will be free to use the materials as originally
provided to UFTB.

      (f) Forfeiture of Exclusivity. If during the Contract Year (as defined in
Section 3.3(b) hereof) ending June 30, 1999, or any Contract Year ending after
that date, the total quantity of UFTB Products subject to Instructions is less
than [*****], Danek would forfeit its exclusivity to provide Management
Services for the following Contract Year. All other rights, terms and conditions
of this Agreement would continue in force. However, if Danek's exclusivity to
provide Management Services is forfeited under this paragraph for two
consecutive years, UFTB shall have, as its remedy, the fight to terminate the
Agreement upon one hundred eighty (180) calendar days written notice.

      Section 3.2 Ordering and Shipping Procedures.

      (a) Submission of UFTB Customer Instructions with Danek. UFTB Customers
shall submit UFTB Customer Instructions for UFTB Products with Danek in Danek's
role as exclusive Management Services provider. To the extent that an UFTB
Customer requests information concerning the purchase, sale or service of UFTB
Products from UFTB directly, UFTB will direct

[CONFIDENTIAL]
                                      -9-
<PAGE>

such inquiry to Danek's customer service telephone number, which number shall be
answered by a Danek customer service representative at Danek's headquarters in
Memphis Tennessee. If Danek's customer service representative determines that
the inquiry involves a service question that may be handled more expeditiously
by one of Danek's independent agents rather than through Danek's headquarters
office, (i.e., because of geographic proximity, expertise, etc.) that inquiry
will be directed to that agent. In the case of a customer seeking to receive
UFTB Products, the representative will verify, via the UFTB Product System (as
defined in Section 3.1 (a)(i) above), inventory availability, pricing and
shipment details for the UFTB Products ordered by the UFTB Customer.

      (b) Receipt and Resubmission of UFTB Customer Instructions by Danek. Upon
receipt of UFTB Customer Instructions, Danek shall cause, via the UFTB Product
System, such UFTB Customer Instructions to print at the UFTB Facility, which
UFTB shall accept; provided however, that UFTB may refuse acceptance of the UFTB
Customer Instructions, (i) if UFTB has experienced an event of force majeure
pursuant to Section 7.4 hereof, but only to the extent the event of force
majeure results in the inability of UFTB to supply UFTB Products, or (ii) to the
extent the UFTB Customer Instructions require quantities in excess of quantities
that UFTB is obligated to provide pursuant to Section 3.1(b) under the then
prevailing forecasts provided by Danek pursuant to Section 3.1(b) hereof,
provided, however that in the event of a refusal of acceptance of UFTB Customer
Instructions under this clause (ii), such refusal shall be limited to the extent
of such excess and UFTB shall, in accordance with provisions of Section 3.1(b)
hereof, use its best efforts to provide the products and quantities so ordered.

                                      -10-
<PAGE>

      (c) Contents and Priority of UFTB Customer Instructions. The UFTB
Customers Instructions submitted by Danek to UFTB in accordance with Section
3.2(b) shall set forth the quantity of units of each UFTB Product required to be
shipped by UFTB to UFTB Customers, and the date (or dates) by which such
deliveries are requested by the UFTB Customer to be made. Such UFTB Customer
Instructions may be submitted by UFTB Customers only in accordance with Section
3.2(a) hereof Danek agrees that UFTB Customer Instructions relating to Current
Products that are submitted by physicians practicing in hospitals affiliated
with the University of Florida shall be granted priority over other UFTB
Customers if shortages of such Current Products exist; provided, however, that
UFTB shall be required to first fulfill any preexisting commitments as the
result of UFTB Customer Instructions submitted by other UFTB Customers before
granting such priority.

      (d) Effect of UFTB Customer Instructions. In no event shall the use of any
form of UFTB Customer Instructions, invoice, shipping document, confirmation or
waybill be effective to vary, alter, modify or substitute for the terms and
conditions of this Agreement. All UFTB Customer Instructions shall be subject
to, and shall be deemed to incorporate, all terms and conditions of this
Agreement, which may be amended or waived only in accordance with Sections 7.2
and 7.6 hereof, respectively.

      (e) Acknowledgment of UFTB Customer Instructions. All UFTB Customer
Instructions placed by Danek pursuant to this Agreement shall be accepted by
UFTB within ten calendar days, except to the extent acceptance of any UFTB
Customer Instructions is refused pursuant to Section 3.2(b) hereof. In such
acceptance, or by other advance communication, which shall be communicated via
the UFTB Product System, UFTB shall notify Danek of (i) the anticipated date

                                      -11-
<PAGE>

of release for shipment of the UFTB Products related to the particular UFTB
Customer Instructions, and (ii) the date of shipment of the UFTB Products
related to the particular UFTB Customer Instructions. Upon the Shipment of UFTB
Products subject to UFTB Customer Instructions, UFTB shall provide Danek with a
copy of the invoice sent to the UFTB Customer, which invoice shall set forth (i)
the amount invoiced for each UFTB Product subject to the UFTB Customer
Instructions, (ii) the quantity of each UFTB Product subject to the UFTB
Customer Instructions and (iii) a reference to the fact that Danek is acting on
behalf of UFTB as a Management Service Provider and as such any questions
regarding the UFTB Products subject to UFTB Customer Instructions should be
directed to Danek. Danek shall guarantee the payment of all invoices sent to
UFTB Customers (other than physicians practicing in hospitals affiliated with
the University of Florida) for UFTB Products subject to UFTB Customer
Instructions. If Danek is unable to collect payment from UFTB Customers for such
invoices within one (1) year of the date of shipment of applicable UFTB Products
subject to UFTB Customer Instructions, Danek shall remit payment of such invoice
to UFTB, less the appropriate Management Services fees owed to Danek.

      (g) Failure to Meet Shipping Schedule. If UFTB discovers that it will be
unable to meet the required shipping schedule as set forth in any UFTB Customer
Instructions for any UFTB Product, UFTB shall promptly notify Danek. If UFTB
reasonably believes that such inability will result in a failure to deliver such
UFTB Product within 30 days of the required shipping date (as set forth in such
UFTB Customer Instructions), UFTB will assist Danek to develop or find an
alternate source of such UFTB Product for the time period during which UFTB is
unable to supply the UFTB Product.

                                      -12-
<PAGE>

      Section 3.3 Initial Exclusivity Fee Paid by Danek. For the Management
Services exclusivity and other rights granted hereby to Danek by UFTB, Danek
paid UFTB the one-time sum of Two Million Five Hundred Thousand Dollars
($2,500,000) on July 23, 1996, which fee has been and shall be used only for
purposes of fulfilling UFTB's obligations under this Agreement and for no
other purpose.

      Section 3.4 Management Services Fees to be Paid by UFTB.

      (a) Amount of Management Services Fees. The management fees to be paid to
Danek by UFTB for the Management Services provided hereunder (the "Management
Services Fees") shall be payable with respect to all UFTB Customer Instructions
submitted by Danek to UFTB according to the following:

            (i)   For Contract Years beginning on the date of this Agreement and
                  ending prior to July 1, 1992, the Management Services Fee
                  shall be eighty percent (80%) of the actual net invoiced
                  amount (as determined in accordance with Section 3.4(c)) from
                  UFTB to UFTB Customers for the particular UFTB Products
                  subject to UFTB Customer Instructions submitted by Danek to
                  UFTB during such Contract Years;

            (ii)  For Contract Years commencing after June 30, 1998, the
                  Management Services Fee shall be seventy percent (70%) of the
                  actual net invoiced amount from UFTB to UFTB Customers for the
                  particular UFTB Products subject to UFTB Customer Instructions
                  submitted by Danek to UFTB during such Contract Years. For
                  each Contract Year commencing after June 30, 1998, Danek will
                  guarantee UFTB that the actual net invoiced amount from

[CONFIDENTIAL]
                                      -13-
<PAGE>

                  to UFTB Customers for UFTB Products subject to UFTB Customer
                  Instructions submitted by Danek to Danek during such Contract
                  Year less the Management Services Fee payable in connection
                  with such UFTB Products will equal [*****] of such UFTB
                  Products or Danek will refund the difference to UFTB from
                  the Management Services Fees.

      (b) Contract Year. For purposes of this Agreement, "Contract Year" shall
mean each consecutive twelve-month period beginning on July 1 and ending June 30
during the term of this Agreement.

      (c) Net Invoiced Amount. As the Exclusive Management Services provide to
UFTB, Danek will maintain a unique relationship with the market place for UFTB
Products and is therefore obligated to consult with UFTB on establishing and
publishing the net invoiced amount for Current Products to be paid by UFTB
Customers. Likewise any new UFTB Product that is not a Current Product will have
its net invoiced amount established by UFTB after consultation with Danek.
Changes in net invoiced amounts for any UFTB Product may be modified during the
term of this Agreement upon the mutual agreement of the parties.

      (d) Full Processing Costs. "Full Processing Costs" for each unit of the
Current Products are set forth on Schedule 3.4(d) hereto. Full Processing Cost
is defined as the sum of direct processing costs, plus an appropriate share of
applicable indirect processing cost. Full Processing Cost is the cost at which
completed Current Product should be carried in inventory by UFTB. It is also the
cost that should be recorded as cost of transfer when Current Products are
distributed by UFTB to UFTB Customers.

[CONFIDENTIAL]
                                      -14-
<PAGE>

      Direct processing cost includes direct labor and direct material costs.
Direct labor cost is defined as all labor directly associated with transforming
or adding value to the Current Products. Such labor includes fabrication,
processing, process or machine tending, assembly, packaging, and on line
inspection labor. Direct material cost is defined as direct material that
becomes a physical part of the cost object and those materials that are consumed
during processing that can be specifically identified with that cost object.
Material cost should include packing supplies necessary to deliver goods to
customers.

      Indirect processing cost are costs which cannot be specifically identified
with a single cost object in an economically feasible manner. Indirect
processing cost includes such costs as indirect labor, repairs and maintenance,
indirect materials and supplies, depreciation, insurance, and property taxes.
Indirect processing cost also may be referred to as processing overhead.

      Costs incurred by UFTB from affiliates of UFTB shall only be included
within the Full Processing Costs to the extent of actual direct cost of such
affiliate notwithstanding any other pricing arrangement between UFTB and such
affiliate. If any UFTB Product that is not a Current Product is processed
pursuant to this Agreement, the parties hereto shall negotiate in good faith to
amend Schedule 3.4(d) by mutual agreement to set forth the Full Processing Costs
for each unit of such product and using, to the extent reasonably practicable
and if such UFTB Product is an extension of a Current Product, the Full
Processing Cost information with respect to the Current Product as to which such
UFTB product is an extension.

      On or before May 15, 1998 and on or before May IS in each subsequent
Contract Year, UFTB shall provide in writing to Danek a copy of such Schedule
3.4(d) amended to reflect any increases or reductions in the Full Processing
Cost (calculated in the same manner that Schedule

                                      -15-
<PAGE>

3.4(d) was originally calculated) for the next Contract Year, and shall provide
Danek with detailed cost analysis, including supporting schedules, together with
justifiable assumptions relating to increases or decreases in costs which would
support changes in the costs set forth on such Schedule for the then current
Contract Year. Each party expects, and UFTB will use its best efforts to ensure,
that the average percentage increase in such direct costs will not exceed the
percentage increase of the Index (as defined below) in the corresponding period
of time. The "Index" shall mean the Department of Labor, Bureau of Statistics,
Producer Price Index, Pharmaceutical Preparations, Proprietary
(Over-the-Counter) -- 0636 Commodity Code.

      In the event that either Danek or UFTB discovers or develops a more
efficient manner of processing an UFTB Product, and such manner of processing
would or is reasonably likely to result in a reduction of Direct Processing Cost
associated with such product, each party will notify the other of such manner of
processing, and at the request of Danek, UFTB will use its best efforts to
utilize such manner of processing. Reductions in the cost of processing such
UFTB Product will be directly reflected in reductions in Full Processing Costs.

      (e) Danek's Audit Rights. UFTB shall keep complete and accurate books and
records in connection with the calculation of Full Processing Costs for the UFTB
Products as well as for verifying the amounts invoiced by UFTB to UFTB Customers
for UFTB Products. Danek shall be permitted access to such books and records
during normal business hours and upon reasonable business hours during the term
of this Agreement in order to verify UFTB's compliance with the terms of the
Agreement and to permit Danek to satisfy its obligations under this Agreement,
including, but not limited to, determining the identities of any UFTB Customer
that fails to pay payment of invoices so that Danek can guarantee UFTB Customer
payments to UFTB in accordance

                                      -16-
<PAGE>

with Section 3.2(e) hereof Danek shall have the right (no more often than once
yearly and in any event within three years after the close of the month to which
the audit relates) to have an audit performed during normal business hours and
upon reasonable notice to UFTB of such books and records by an independent
certified public accounting firm mutually acceptable to the parties for the sole
purpose of verifying the correct and accurate payment of Management Service Fees
which shall be the sole matter reported by such accounting firm to Danek. The
fees and expenses of the accounting firm performing such verification shall be
borne by Danek, except in the event that Full Processing Costs are overstated by
more than $100,000 for such year or in the event that the actual net invoiced
amounts are understated by more than $100,000 for such year, whereupon such fees
and expenses shall be borne by UFTB. UFTB shall within 60 days of the results of
such audit provide for payment of amounts which are overpaid, unless a bona fide
dispute exists as to the results of such audit.

      (f) Payments in U.S. Dollars. All payments required by this Agreement
shall be made in United States Dollars.

      (g) UFTB Customer Payments. Payment terms related to shipments of UFTB
Products to UFTB Customers shall be net 30 days from the later of the date of
invoice or the date of shipment.

      (h) Management Services Fee Payments. Payment to Danek by UFTB of
Management Service Fees shall be made within ten (10) days from UFTB's receipt
of payment of an invoice during the term of this Agreement with respect to UFTB
Customers Instructions submitted by Danek.

      Section 3.5 Packaging Specifications. UFTB shall supply all packaging and
labeling information and designs, including without limitation all artwork and
pharmacological information, usage instructions and warnings to be applied to
each UFTB Product (the "Packaging

                                      -17-
<PAGE>

Specifications"). Specifically, the Packaging Specifications shall include the
requirement that each UFTB Product be hermetically sealed or vacuum sealed with
bottle and stopper after processing. Once a UFTB Product is supplied and
initially packaged by UFTB, Danek will not, without UFTB's concurrence, remove,
alter or modify any Packaging Specifications of such UFTB Product except in the
case of Danek's own internal use.

      Section 3.6 Delivery; Right to Use.

      (a) Shipping. Danek shall issue customer shipping instructions to UFTB for
the UFTB Product in accordance with the UFTB Customer Instructions, using
Danek's or the UFTB Customer's choice of carriers FOB at the plant at which the
UFTB Product is processed.

      (b) Certificate of Analysis. At the time of shipment by UFTB of any UFTB
Product processed by UFTB pursuant to UFTB Customer Instructions, a Certificate
of Analysis (as defined herein) shall be delivered to Danek at the address set
forth in Section 7.8 hereof and to the UFTB Customer along with the invoice
delivered in connection with such shipment of UFTB Product. A "Certificate of
Analysis" is a certificate, signed on behalf of UFTB, certifying that the
shipped UFTB Product conforms to the UFTB Product Specifications and the UFTB
Product Warranties set forth in Section 2.2 hereof, and providing the results of
the tests that demonstrate that such product so conforms.

      (c) Right to Use. All right to use and risk of loss to any UFTB Product
shall pass to the UFTB Customer upon a common carrier accepting possession or
control of such UFTB Product.

      Section 3.7 Rejected Product.

      (a) Procedure for Rejection. Within thirty (30) days after a UFTB
Customer's receipt of any shipment of UFTB Product, Danek shall notify UFTB in
writing if a UFTB Customer chooses

                                      -18-
<PAGE>

to reject all or any part of such shipment of UFTB Product or, failing such
notification, unless such product has a latent defect, the UFTB Customer shall
be deemed to have accepted such shipment for purposes of payment for it. With
respect to latent defects, Danek shall promptly notify UFTB after a UFTB
Customer's discovery thereof, and such UFTB Customer shall have the right to
reject such product. Any notification of rejection should be for valid technical
or packaging reasons and shall state the basis for the rejection. A replacement
shipment of such product so required by a UFTB Customer shall be made by UFTB as
soon as practicable using reasonable efforts (but no later than thirty (30) days
after UFTB receives such notification), or as soon thereafter as the raw
materials are available to UFTB for the processing of such replacement product.
Such replacement product shall be invoiced by UFTB and paid for by the UFTB
Customer at the same fee as was the rejected shipment.

      (b) Effect of Rejection. The UFTB Customer shall not be obligated to pay
and Danek shall not be obligated to guarantee payment for any rejected shipment
of UFTB Product shipped to UFTB Customers which fails to meet the UFTB Product
Specifications or the Packaging Specifications or otherwise breaches the UFTB
Product Warranties set forth in Section 2.2 hereof. The UFTB Customer shall not
be obligated to pay in full and Danek shall not be obligated to guarantee
payment for any shipment of the UFTB Product rejected by a UFTB Customer. UFTB
shall have fifteen (15) days within which to notify Danek and the UFTB Customer
in writing of UFTB's objection to such rejection, and the parties shall
thereafter promptly submit the issue to an independent laboratory in accordance
with subparagraph (c) below.

      (c) Testing to Resolve Conflicting Test Results. If there is a conflict
between the test results of UFTB and the test results of Danek or a UFTB
Customer with respect to any UFTB

                                      -19-
<PAGE>

Product, an adequate sample of same shall be submitted by the party having
possession thereof to an independent laboratory acceptable to both parties for
testing against the UFTB Product Specifications under procedures employed in the
UFTB Product Specifications. The test results obtained by such laboratory shall
be final with respect to the obligations of the UFTB Customer to pay and of
Danek to guarantee payment for such UFTB Product. The fees and expenses of such
laboratory testing shall be borne entirely by the party against whom such
laboratory's findings are made. If the laboratory's findings are in favor of
UFTB, the UFTB Customer shall pay UFTB for the rejected UFTB Products under the
terms listed in Section 3.4 hereto.

      (d) Return or Disposal of Rejected UFTB Products. UFTB shall make
arrangement with Danek for the return or disposal, at UFTB's option, of any
shipment of any rejected UFTB Product. The return shipping charges or disposal
costs for such rejected shipment of Product shall be paid by UFTB and, in the
event of agreement of the parties or a laboratory determination hereunder that
such rejected shipment does meet the UFTB Product Specifications, or in the
event of agreement of the parties that such rejected shipment does meet the
Packaging Specifications, the UFTB Customer shall promptly reimburse UFTB for
such shipping charges or disposal costs.

      (e) No Waiver. No acceptance or rejection of product or determination of
compliance for purposes of this Section 3.7 shall serve to waive any rights
under Article VI.

      Section 3.8 Taxes. Taxes and any and all other tariffs and duties or
excise, sales or use, value added or other taxes or levies imposed upon UFTB in
connection with the process and distribution of the UFTB Products shall be paid
by UFTB.

                                      -20-
<PAGE>

                                   ARTICLE IV

                      CERTAIN AGREEMENTS OF UFTB AND DANEK

      Section 4.1 Inspections. UFTB shall permit a representative of Danek to
inspect, at reasonable times and at a reasonable frequency, those processing
facilities and methods and operations used by UFTB in connection with the UFTB
Products as considered necessary or desirable by Danek for the purpose of
observing compliance with the undertakings set forth in Article II hereof. No
such observation shall serve to waive any rights of Danek hereunder.

      Section 4.2 Regulatory Filings. UFTB shall fulfill all reporting and other
requirements of applicable regulatory agencies with respect to the UFTB
Products. Danek shall cooperate in preparing any such filings to the extent
reasonably requested by UFTB.

      Section 4.3 Ownership of Intellectual Property Rights.

      (a) Intellectual Property Rights. For purposes of this Agreement,
"Intellectual Property Rights" means all works, including literary works,
pictorial, graphic and sculptural works, architectural works, works of visual
art, and any other work that may be the subject matter of copyright protection;
advertising and marketing concepts; trademarks; information; data, formulas;
designs; models; drawings; computer programs; including all documentation,
related listings, design specifications and flowcharts, trade secrets and any
inventions including all processes, machines, manufactures and compositions of
matter and any other invention that may be the subject matter of patent
protection; and all statutory protection obtained or obtainable thereon.

      (b) Ownership of Intellectual Property Rights. All Intellectual Property
Rights relating to the UFTB Products shall be owned or obtained under license by
UFTB (subject to grants of licenses referred to herein); provided, however, that
nothing in this Section 4.3 shall be construed

                                      -21-
<PAGE>

or interpreted as granting in any manner or way any rights to UFTB in any
Intellectual Property Rights of Danek, including, but not limited to any
Intellectual Property rights to the UFTB Product System installed by Danek at
UFTB's Alachua, Florida facility in accordance with Section 3.1 hereof.

      Section 4.4 Rights of First Refusal. UFTB agrees that if UFTB makes
available for distribution any product, or develops any technology, relating to
spinal or cranial medical procedures (other than the UFTB Products which are
subject to this Agreement), then Danek shall be promptly notified by UFTB with
sufficient details relating thereto to enable Danek to evaluate such products or
technology. Thereafter, Danek shall have a right of first refusal to obtain such
product or license such technology on the best terms and conditions offered by
UFTB. Danek shall have a period of sixty (60) days within which to accept such
offer to obtain such product or license such rights.

                                    ARTICLE V

                              TERM AND TERMINATION

      Section 5.1 Term. The term of this Agreement shall commence as of the date
hereof and shall continue until the twenty-fifth anniversary of the date hereof
unless terminated earlier in accordance with Section 5.2.

      Section 5.2 Early Termination. Either party hereto may terminate this
Agreement (a) due to a material breach by the other party of any of its
obligations or covenants hereunder upon 30 calendar days' notice to the
breaching party if such breaching party fails to remedy such breach within such
30 calendar days, or if such breach cannot be remedied within such 30 calendar
days, only if such breaching party has not undertaken good faith efforts to
remedy such breach or (b) the insolvency or filing for bankruptcy by the other
party. This Agreement may not be terminated

                                      -22-
<PAGE>

without cause except as specifically provided herein or by the mutual written
agreement of the parties.

      Section 5.3 Accrued Obligations. In the event that this Agreement is
terminated due to the breach of either party pursuant to Section 5.2 hereof, the
duties and obligations of the breaching party which have accrued prior to
termination, including without limitation, the obligation to process and deliver
quantities of the UFTB Products for which Instructions have been validly issued
prior to notice of termination and the correlative obligation to pay for such
quantities, shall not be released or discharged by such termination.

                                   ARTICLE VI

                                 INDEMNIFICATION

      Section 6.1 Indemnification by Danek. Subject to UFTB's indemnification
obligations pursuant to Section 6.2 hereof, Danek shall indemnify and hold UFTB
harmless from any and all losses, damages, liabilities, costs and expenses,
including, without limitation, reasonable attorneys fees and court costs, that
may result from any demand, claim or litigation relating to, resulting from or
out of the provision of Management Services by Danek.

      Section 6.2 Indemnification By UFTB. UFTB shall indemnify and hold Danek
harmless from any and all losses, damages, liabilities, costs and expenses,
including, without limitation, reasonable attorneys fees and court costs, that
may result from any demand, claim or litigation relating to, resulting from or
arising out of (i) the failure of any UFTB Product to comply with the UFTB
Product Specifications, (ii) a breach by UFTB of any warranty, representation or
covenant made by UFTB, including a breach by UFTB of the UFTB Products
warranties set forth in Section

                                      -23-
<PAGE>

2.2 hereof; (iii) the failure of the packaging related to any UFTB Product to
comply with the Packaging Specifications; or (iv) the distribution by UFTB of
the UFTB Products.

      Section 6.3 Survival of Obligations. The respective obligations of the
parties hereto pursuant to Article VI shall survive the termination of this
Agreement.

                                   ARTICLE VII

                                  MISCELLANEOUS

      Section 7.1 Entire Agreement. This Agreement, together with the exhibits
and schedules hereto constitute the entire agreement of the parties hereto with
respect to the subject matter hereof and supersede any prior expression of
intent or agreement of the parties with respect thereto.

      Section 7.2 Amendments. This Agreement shall not be modified, altered, or
amended except by an agreement in writing signed by duly authorized
representatives of each of the parties hereto.

      Section 7.3 Governing Law; Jurisdiction. This Agreement shall be governed
by the laws of the State of Florida (regardless of the laws that might otherwise
govern under applicable principles of conflicts of law) as to all matters,
including but not limited to matters of validity, construction, effect,
performance and remedies. The parties agree to submit to personal jurisdiction
and to waive any objection as to venue and forum non convenes in the federal or
state courts of the State of Florida.

      Section 7.4 Force Majeure. Neither party shall be liable for
nonperformance or delay in performance due to and to the extent resulting from
an event of force majeure, including without limitation: any act of god;
regulation or law of any government; war, riot, or civil commotion; destruction
of production facilities or materials by fire, earthquake or storm; strike or
other labor

                                      -24-
<PAGE>

disturbances; epidemic; failure of public utilities or common carriers; or any
limitation, requirement or prohibition imposed or required by the United States
Food and Drug Administration or any other governmental agency asserting
jurisdiction with regard to the UFTB Products. In case any of the foregoing
occurrences should in any manner hinder either party hereto from fulfillment of
its obligations specified in this Agreement, said party shall promptly give
written notice to the other party. In the event that UFTB has experienced an
event of force majeure, and as a result hereof is unable to supply Danek with
any UFTB Product, Danek may procure that UFTB Product from another manufacturer.

      Section 7.5 Severability. In the event that any part of this Agreement
shall for any reason be finally adjudged by a court of competent jurisdiction or
determined by a governmental body to be invalid or unenforceable, then, unless
such part is deemed material by either or both parties, this Agreement shall
continue in effect and such part shall be excised herefrom. If either party
determines that such part hereof found to be invalid or unenforceable is
material to the operation or performance of this Agreement, then such party may,
by written notice to the other party, request that the parties attempt to
renegotiate this Agreement to alleviate or eliminate any difficulty caused to
such party by such invalidity or unenforceability.

      Section 7.6 Waiver. No failure or delay on the part of either party to
enforce any provision of this Agreement or to exercise any right granted hereby
shall operate as a waiver thereof unless or until the right to enforce any such
provision or to exercise any such right has been waived in writing by such
party. Any waiver of any provision hereof or right hereunder shall be effective
only in accordance with its terms and may be restricted in any way. No waiver of
any provision

                                      -25-
<PAGE>

hereof or any right hereunder shall constitute a waiver of a continuance or
reoccurrence of the failure to perform, except as provided in such waiver.

      Section 7.7 No Third Party Beneficiaries. This Agreement shall be
construed to be for the benefit of the parties hereto only and shall confer no
right or benefit upon any other Person.

      Section 7.8 Notices. Any notice, report or consent required or permitted
by this Agreement to be given or delivered shall be in writing and shall be
deemed given or delivered if delivered in person, or sent by registered or
certified mail, postage prepaid, return receipt requested, or sent by telecopy
(if confirmed), as follows:

            If to Danek:

                  Sofamor Danek Group, Inc.
                  1800 Pyramid Place
                  Memphis, Tennessee 38132
                  Attention: President and Chief Operating Officer
                  Telecopy: 901-344-1570

            with a copy to:

                  Vice President and General Counsel
                  Sofamor Danek Group, Inc.
                  1800 Pyramid Place
                  Memphis, Tennessee 38132
                  Telecopy: 901-344-1576

            If to UFTB:

                  University of Florida Tissue Bank, Inc.
                  1 Progress Boulevard
                  Box 31
                  Alachua, Florida 32615
                  Attention: President and Chief Operating Officer
                  Telecopy: 904-462-5131

                                      -26-
<PAGE>

            with a copy to:

                  Ms. Susan Collingwood
                  Associate General Counsel
                  University of Florida College of Medicine
                  P.O. Box 100215
                  Gainesville, Florida 32610
                  Telecopy: 352-392-6482

Any such notice, report or consent shall be effective upon delivery if given or
delivered in person, or upon receipt if sent by telecopy which is confirmed, or
on the third business day following mailing if mailed. Either party hereto may
change its address for purposes hereof by giving the other party written notice
of such change as above provided.

      Section 7.9 Assignment. Neither party may assign its rights and
obligations hereunder without the prior written consent of the other party. No
permitted assignment hereunder shall be deemed effective until the assignee
shall have executed and delivered an instrument in writing reasonably
satisfactory in form and substance to the other party pursuant to which the
assignee assumes all of the obligations of the assigning party hereunder. The
parties acknowledge, however, that UFTB is currently considering the formation
of a subsidiary for-profit corporation to conduct the business, legal and
financial affairs contemplated by this Agreement, to which for-profit
corporation UFTB could or may assign intellectual property rights and all other
rights and properties necessary to fulfill the obligations to Danek and to
which, subject to Danek's approval, this Agreement could or may be assigned.

      Section 7.10 Headings. The table of contents and the headings of the
various articles and sections hereof are for convenience of reference only,
shall not be deemed to be a part hereof, and shall not affect the meaning or
construction of any provision hereof.

                                      -27-
<PAGE>

      Section 7.11 Counterparts. This Agreement may be executed in two or more
counterparts, all of which shall be considered one and the same agreement, and
shall become effective when signed by each of the parties hereto.

                                      -28-
<PAGE>

      IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective duly authorized representatives on this __ day of
November, 1996 and effective July 23, 1996.

UNIVERSITY OF FLORIDA TISSUE BANK, INC.

By: /s/ James M. Grooms
    -----------------------------------

Name:__________________________________

Title:_________________________________

Date:__________________________________

SOFAMOR DANEK GROUP, INC.

By: /s/ James J. Gallogly
    -----------------------------------

Name: James J. Gallogly

Title: President

Date:__________________________________

                                      -29-
<PAGE>

                                   SCHEDULE A

                                CURRENT PRODUCTS

                           Cancellous Cortical Strips

                              ACE Fibula Shafts(1)

                             Femoral Cortical Shafts

                              Tibia Cortical Shafts

                            Fibula Cortical Shafts(1)

                  Humeral Cortical Shafts Cortical Bone Screws

                         Smith-Robinson Cortical Blocks

                         Cervical Cortical Tapered Screw

                 MD Series (MD-I, MD-II, MD-III) of threaded and
                           non-threaded tissue dowels

----------
(1)   The exclusive rights to these UFTB Products are subject to exclusive
      distribution rights granted to third parties, which distribution rights
      shall be disclosed by UFTB to Danek within ten (10) days of the date of
      this Agreement.

                                      -30-
<PAGE>

                                  SCHEDULE 2.1
                        SPECIFICATIONS FOR UFTB PRODUCTS

      The Specifications for certain of the UFTB Products are set forth on the
attached Exhibit A to this Schedule 2.1. If specifications are not provided for
any particular Current Product, UFTB shall provide such specification within
ninety (90) days of the date of this Agreement. [Was Exhibit A ever attached?
Were additional specifications provided?]

                                      -31-
<PAGE>

                                  SCHEDULE 2.3
                               PROCESSING CAPACITY

      UFTB shall provide its current and projected processing capacity for each
of the Current Products within ninety (90) days of the date of this Agreement.
[Has UFTB provided Danek information concerning this capacity?]

                                      -32-
<PAGE>

                                 SCHEDULE 3.4(d)
                              FULL PROCESSING COSTS

      UFTB shall identify the Full Processing Costs within ninety (90) days of
the date of this Agreement [Has UFTB provided Danek with the Full Processing
Costs?]

                                      -33-
<PAGE>

                          [Letterhead of SOFAMOR DANEK]

                                                         JIM GALLOGLY
                                                         President and
                                                         Chief Operating Officer

                                 January 2, 1998

Mr. Jamie Grooms
President & Chief Executive Officer
University of Florida Tissue Bank, Inc.
One Innovation Drive
Alachua, FL 32615

               RE: Management Services Agreement

Dear Mr. Grooms:

      Please allow this letter to serve as an amendment to the 1996 Management
Services Agreement, as amended on April 21, 1997 ("Agreement") between Sofamor
Danek Group, Inc. ("Sofamor Danek") and the University of Florida Tissue Bank,
Inc. ("UFTB").

Section 3.4(h) of the Agreement is amended to read as follows:

      Management Services Fee Payments. Payment to Sofamor Danek by UFTB of
      Management Services Fees shall be made on the sixteenth (16th) day of the
      second month following the month during which UFTB received payment of an
      invoice with respect to UFTB Customer's Instructions submitted by Sofamor
      Danek pursuant to this Agreement. Notwithstanding the previous sentence of
      this Section 3.4(h), if the amount of Management Services Fees due to
      Sofamor Danek in any given month during the term of this Agreement exceeds
      the total accounts receivable due and payable to UFTB from UFTB Customers
      ("UFTB Customer Accounts Receivable"), then the amount of the payment
<PAGE>
Mr. Jamie Grooms
January 2, 1998
Page 2

      required pursuant to this Section 3.4(h) shall be no greater than the UFTB
      Customer Accounts Receivable; provided, however, if at the end of any
      month during the term of the Agreement, UFTB has on hand cash and
      unencumbered cash equivalents greater than One Million Dollars
      ($1,000,000), then the payment by UFTB to Sofamor Danek of Management
      Services Fees on the 16th day of the next calendar month shall be
      increased by the amount that such cash and unencumbered cash equivalents
      exceeds One Million Dollars ($1,000,000); provided, however, that during
      the term of this Agreement UFTB shall not be obligated to pay Sofamor
      Danek an amount greater than all of the Management Services Fees owed to
      Sofamor Danek plus interest as specified below, plus any amount required
      to be paid to Sofamor Danek pursuant to Section 3.4(i). In the event that
      on the 16th day of any month during the term of this Agreement UFTB does
      not pay to Sofamor Danek all Management Services Fees due and payable to
      Sofamor Danek, then the unpaid amount of said Management Services Fees
      shall accrue interest on a daily basis at the rate of twelve percent (12%)
      per annum.

      On the 16th day of each month during the term of this Agreement, UFTB
      shall provide the following reports to Sofamor Danek (i) all Management
      Services Fees being paid to Sofamor Danek, together with a listing of all
      UFTB invoice numbers applicable to those Management Services Fees; (ii)
      all unpaid Management Services Fees due to Sofamor Danek from UFTB; (iii)
      all UFTB Customer Accounts Receivable due to UFTB from customers of UFTB
      products; (iv) all cash and unencumbered cash equivalents held by UFTB at
      the end of the previous calendar month; and (v) those required by Section
      3.4(i).
<PAGE>
Mr. Jamie Grooms
January 2, 1998
Page 3

The Agreement is hereby amended to add a new Section 3.4(i):

      3.4(i). Monthly SR Inventory Service Fee. Each month during the term of
      this Agreement that UFTB completes a SR set forecasted by SDG, Sofamor
      Danek will pay to UFTB an amount equal to twenty percent (20%) of the
      retail selling price of each such SR set ("Service Fee"). Upon the sale of
      any such SR set or sets, the amount of the Service Fee applicable to such
      SR set or sets shall be refunded to Sofamor Danek by UFTB.

      On the sixteenth (16th) day of any month during the term of this
      Agreement, UFTB shall submit to Sofamor Danek a report that lists (i) all
      SR sets completed during the immediately preceding calendar month, (ii)
      all SR sets sold during the immediately preceding calendar month, (iii)
      the retail selling price of each SR set completed and each SR set sold
      during the immediately preceding calendar month and (iv) the amount of the
      Service Fee to be paid to UFTB and to be refunded to Sofamor Danek for the
      immediately preceding calendar month. If the amount of the Service Fee to
      be paid to UFTB exceeds the amount of the Service Fee to be refunded to
      Sofamor Danek, then the amount of that excess shall reduce the amount of
      the Management Services Fees payable to Sofamor Danek pursuant to Section
      3.4 (h). If the amount of the Service Fee to be refunded to Sofamor Danek
      exceeds the amount of the Service Fee to be paid to UFTB, than the amount
      of that excess shall be added to Management Services Fees payable to
      Sofamor Danek pursuant to Section 3.4(h).
<PAGE>
Mr. Jamie Grooms
January 2, 1998
Page 4

      If these amendments are agreeable to you, please sign both of these
originals and return one.

                                          Very truly yours,

                                          /s/ James J. Gallogly
                                            James J. Gallogly

JJG/dg

AGREED TO AND ACCEPTED:

UNIVERSITY OF FLORIDA TISSUE BANK, INC.

/s/ Jamie M. Grooms
-----------------------------------
Jamie M. Grooms
President & Chief Executive Officer
<PAGE>

                          [Letterhead of SOFAMOR DANEK]

                                                         JIM GALLOGLY
                                                         President and
                                                         Chief Operating Officer

                                 April 21, 1997

Mr. Jamie M. Grooms
President & Chief Executive Officer
University of Florida Tissue Bank, Inc.
1 Progress Boulevard
Alachua, Florida 32615

               Re: Management Services Agreement

Dear Mr. Grooms:

      Please allow this letter to serve as an amendment to the Management
Services Agreement between Sofamor Danek Group and UFTB ("Agreement"). The
purpose of this amendment will be to recognize UFTB's right to reimbursement for
the following items:

      1.    UFTB's actual cost for product liability and general liability
            insurance that is attributable to the Management Services Fees
            portion of UFTB revenues.

      2.    The State of Florida tissue bank fee/tax of .005 that is
            attributable to the Management Services Fees portion of UFTB
            revenues.

      3.    Effective December 1, 1996, the cost that UFTB incurs to hire an
            accounts receivable employee who will be responsible for accounts
            receivable related to UFTB revenues generated from the UFTB Products
            covered by the Agreement. Additionally, the cost that UFTB will
            incur to hire an additional accounts receivable employee who will be
            responsible for accounts receivable, which employee will be hired
            during the calendar quarter that UFTB revenues related to this
            Agreement reaches an annualized level of $50,000,000.
<PAGE>
Mr. Jamie M. Grooms
April 21, 1997
Page Two

      4.    The second sentence of Section 3.4(a)(ii) of the Agreement is hereby
            deleted from the Agreement.

      UFTB will be paid its actual costs for those items listed above by showing
the specific cost thereof and deducting it from the amounts payable to Sofamor
Danek under the terms of the Agreement.

      If these amendments are agreeable to you, please sign both of these
originals and return one to me for our files.

                                          Very truly yours,

                                          /s/ James J. Gallogly
                                            James J. Gallogly

JJG:mb

AGREED TO AND ACCEPTED:

UNIVERSITY OF FLORIDA TISSUE BANK, INC.

/s/ Jamie M. Grooms
-----------------------------------
Jamie M. Grooms
President & Chief Executive Officer

<PAGE>

                             ASSIGNMENT AND ASSUMPTION OF
                            MANAGEMENT SERVICES AGREEMENT

     THIS ASSIGNMENT AND ASSUMPTION OF MANAGEMENT SERVICES AGREEMENT (the
"Assignment") is made and entered into this 23rd day of January, 1998, by and
between UNIVERSITY OF FLORIDA ORTHOPAEDIC TISSUE BANK, INC., d/b/a UNIVERSITY
OF FLORIDA TISSUE BANK, INC., a Florida not-for-profit corporation
("Assignor"), and REGENERATION TECHNOLOGIES, INC., a Florida for-profit
corporation ("Assignee").

                                 W I T N E S S E T H:

     WHEREAS, Assignor and Assignee are parties to that certain Patent
License Agreement, dated January 23, 1998 (the "License Agreement"), pursuant
to which Assignor has agreed to license to Assignee the patents or pending
patents listed in Exhibit "A" attached hereto and made a part hereof on the
condition that Assignee meets certain financing goals; and

     WHEREAS, pursuant to the License Agreement, Assignor has agreed to
assign to Assignee all of Assignor's right, title and interest in, and all of
its obligations under, that certain Management Services Agreement, by and
between Assignor and Sofamor Danek Group, Inc. ("SDG"), a copy of which is
attached as Exhibit "B" (the "SDG Contract") (with certain exceptions) upon
the terms and conditions set forth herein; and

     WHEREAS, pursuant to the License Agreement, Assignee has agreed to
accept such assignment and to assume all of the obligations of Assignor under
the SDG Contract (with certain exceptions) upon the terms and conditions set
forth herein; and

<PAGE>

     WHEREAS, Assignor is willing to assign the SDG Contract and Assignee is
willing to accept such assignment of the SDG Contract and to assume all
obligations of Assignor under the SDG Contract upon the terms and conditions
set forth herein.

     NOW, THEREFORE, in consideration of the mutual promises and covenants
contained herein, the parties hereto agree as follows:

     1. RECITALS. The recitals set forth above are true and correct in all
respects and are incorporated herein as fully as if set forth herein verbatim.

     2. ASSIGNMENT AND ASSUMPTION OF SDG CONTRACTS. Assignor hereby assigns,
transfers, conveys and delivers to Assignee all of Assignor's right, title
and interest in, to and under the SDG Contract, effective on the Effective
Date of this Assignment described in Paragraph 4 below, except as otherwise
provided in Paragraph 3 below. Assignee hereby assumes all of the
obligations, terms and covenants set forth in the SDG Contract to be
observed and performed by Assignor and agrees to be bound by the terms,
conditions and covenants of the SDG Contract arising from and after the
Effective Date, except as otherwise provided in Paragraph 3 below.

     3. EXCEPTIONS FROM ASSIGNMENT. Assignor shall retain and shall not
assign hereunder the following rights and obligations under the SDG Contract
(terms defined in the SDG Contract have the same meanings in this Paragraph
3), as set forth in the following Sections of the SDG Contract:

          (a) SECTION 1.2. Assignor shall retain the obligation to grant a
     license to Danek to use the UFTB Mark.

                                        -2-

<PAGE>

          (b) SECTION 2.1. Assignor shall retain the right to approve any
     amendments to Schedule 2.1.

          (c) SECTION 2.2(b). Assignor shall remain the owner of all rights
     in and to the UFTB Mark.

          (d) SECTION 2.3(b). Assignor shall retain the right to approve any
     amendments to Schedule 2.3.

          (e) SECTION 3.1(e). Assignor shall retain the right to review and
     respond to Danek regarding any advertising using the UFTB Mark or the
     relationship between Danek and Assignor or Danek and the University of
     Florida.

          (f) SECTION 3.1(f). Assignor shall retain the right to terminate the
     SDG Contract in accordance with Section 3.1(f) of the SDG Contract.

          (g) SECTION 3.4(d). Assignor shall retain the right to approve any
     amendments to Schedule 3.4(d).

          (h) SECTION 3.5. Assignor shall retain the right to approve any
     changes to the Packaging Specifications.

          (i) SECTION 4.2. Assignor shall retain the right to approve any
     reporting or other requirements with respect to the UFTB Products.

          (j) SECTION 4.3(b). Assignor shall retain ownership of all
     Intellectual Property Rights relating to the UFTB Products.

     4. EFFECTIVE DATE. The assignment and assumption described in this
Assignment shall be effective on the effective date of the license granted
pursuant to the License

                                       -3-

<PAGE>

Agreement (the "Effective Date"). In the event that the license granted
pursuant to the License Agreement does not become effective, then the
assignment hereunder shall not become effective.

     5. TERMINATION AND BREACH. Any termination of the License Agreement shall
cause a simultaneous termination of this Assignment, without any further
action by Assignor or Assignee. Assignee acknowledges that Assignor may
terminate the License Agreement (which shall also cause a termination of this
Assignment) upon any material breach of this Assignment by Assignee. A breach
by Assignee of any of the obligations under the SDG Contract assumed by
Assignee hereunder shall be a material breach of this Assignment. During the
term of this Assignment, Assignor shall have the right at any reasonable time
to review Assignee's records to determine whether Assignee is complying with
all obligations of the SDG Contract assigned hereunder, and to confirm with
SDG representatives Assignee's compliance with the terms of the SDG Contract
assigned hereunder.

     6. ASSIGNMENT AND ASSUMPTION UPON TERMINATION. Upon any termination of
this Assignment, the parties agree that such termination shall have the
following effect, without any other action required by Assignor or Assignee:

          (a) Assignee shall assign, transfer, convey and deliver to Assignor
the rights of Assignor under the SDG Contract that are assigned to Assignee
hereunder, effective on the date of termination of this Assignment; and

          (b) Assignor shall assume and shall be bound by all of the
obligations, terms and covenants set forth in the SDG Contract to be
observed and performed by Assignor and that were assumed by Assignee
hereunder, effective on the termination of this Assignment.

                                      -4-

<PAGE>

     7. INDEMNIFICATION. Assignor hereby agrees to indemnify and hold
Assignee harmless from any and all claims, demands, damages, costs, losses,
expenses, liabilities and obligations of any kind or nature whatsoever
(including reasonable attorney's fees incurred by Assignee) incurred by
Assignee as a result of any breach by Assignor of any warranty,
representation, covenant or agreement of Assignor contained in this
Assignment or the failure of Assignor to fulfill its obligations pursuant to
the SDG Contract prior to the Effective Date. Assignee agrees to indemnify
and hold Assignor harmless from any and all claims, demands, damages, costs,
losses, expenses, liabilities and obligations of any kind or nature
whatsoever including reasonable attorneys fees incurred by Assignor) incurred
by Assignor as a result of the breach by Assignee of any covenant or agreement
of Assignee contained in this Assignment or the failure of Assignee to
fulfill its obligations pursuant to the SDG Contract arising from and after
the Effective Date.

     8. ATTORNEYS' FEES. Should either party to this Assignment bring suit
for the breach of a promise, covenant, warranty or representation hereunder,
it is agreed that the successful party in such suit shall be entitled, in
addition to recovering any damages sustained thereby, to recover such party's
expenses, including court costs and reasonable attorneys' fees as part of the
judgment or other settlement. Expenses and attorneys' fees include those
incurred prior to the initiation of suit and those incurred in connection
with proceedings in courts of original jurisdiction and courts of appeal.

     9. BINDING EFFECT. This Assignment shall be binding upon, and shall
inure to the benefit of, the parties hereto and their respective successors
and assigns.

                                      -5-

<PAGE>

     10. GOVERNING LAW AND VENUE. This Assignment shall be governed by, and
construed in accordance with, the laws of the State of Florida, and venue for
any legal proceeding or action at law arising out of or construing this
Assignment shall lie in the state courts of Alachua County, Florida, or the
United States District Court for the Northern District of Florida,
Gainesville Division.

     IN WITNESS WHEREOF, the parties hereto have caused this Assignment to be
executed as of the date and year first above written.

<TABLE>
<S>                                     <C>
Signed, sealed and delivered
in the presence of:                     "Assignor"

                                        UNIVERSITY OF FLORIDA ORTHOPAEDIC
                                        TISSUE BANK, INC., d/b/a UNIVERSITY OF
                                        FLORIDA TISSUE BANK, INC., a Florida not-for-
                                        profit corporation

/s/ Kathleen Davis                      By: /s/ F. P. Glowczewskie, Jr.
-------------------------                   -------------------------------------------
                                            Frank P. Glowczewskie, Jr., Chairman of the
                                            Board

/s/ John D. Callahan
-------------------------

                                        "Assignee"

                                        REGENERATION TECHNOLOGIES, INC., a
                                        Florida for-profit corporation

/s/ Kay B. Lopez                        By: /s/ Peter F. Gearen
-------------------------                   -------------------------------------------
                                            Peter F. Gearen, President

/s/ James S. Gantler
-------------------------
</TABLE>

                                        -6-

<PAGE>

                              CONSENT TO ASSIGNMENT

            The undersigned hereby consents to the assignment in the above
ASSIGNMENT AND ASSUMPTION OF MANAGEMENT SERVICES AGREEMENT, as required by
Section 7.9 of the Management Services Agreement.

                                       SOFAMOR DANEK GROUP, INC.

                                       By: /s/ Mark D. LoGuidice
-----------------------------              -------------------------------------
                                           Name: Mark D. LoGuidice
                                           Title: Executive Vice President
-----------------------------

----------
 APPROVED
   AS TO    /s/ [ILLEGIBLE]
LEGAL FORM
----------
----------

<PAGE>

                                  EXHIBIT "A"

1.  "Diaphysial Cortical Dowel," invented by Nicholas E. Grivas and James M.
    Grooms, Docket No. TB-100, U.S. Patent Application S/N 08/587,070, dated
    January 16, 1996, subject to that certain Management Services Agreement
    by and between UFTB and Sofamor Danek Group, Inc., dated effective July
    23, 1996, as amended April 21, 1997 (the "SDG Contract"), and subject to
    that certain Processing License Agreement by and between UFTB and
    AlloSource, Inc., dated January 1, 1997;

2.  "Bone Paste", invented by John F. Wironen and James M. Grooms, Docket No.
    TB-101, U.S. Patent Application S/N 08/816,079, dated March 13, 1997,
    subject to that certain Agreement by and between UFTB and Exactech, Inc.
    dated effective April 22, 1997, which is also owned by the University of
    Florida (the "University");

3.  "Cortical Bone Interference Screw," invented by James M. Grooms, Kevin
    Carter and David H. Dulebohn, Docket No. TB-102, U.S. Patent Application
    S/N 08/687,018, dated July 16, 1996, subject to the SDG Contract;

4.  "Open Intervertebral Spacer," invented by John R. Bianchi, Kevin C.
    Carter, Bradley T. Estes, Larry Boyd and John A. Pafford, Docket No.
    TB-103, U.S. Patent Application S/N not available, dated June 3, 1997,
    subject to that certain Joint Ownership Agreement, between UFTB and Danek
    Medical, Inc., dated June 12, 1997, and the SDG Contract;

5.  "Cortical Bone Cervical Smith-Robinson Fusion Implant," invented by James
    M. Grooms, Kevin C. Carter, David H. Dulebohn and Tom Sander, Docket No.
    TB-104, U.S. Patent Application S/N 08/920,630, dated August 27, 1997,
    subject to the SDG Contract;

6.  "Segmentally Demineralized Bone Implant," invented by James M. Grooms,
    Kevin C. Carter and Thomas W. Sander, Docket No. TB-105, U.S. Patent
    Application S/N 08/958,364 filed October 27, 1997;

7.  "Cervical Tapered Dowel," Docket No. TB-106, subject to the SDG Contract;

8.  "Bone Grafting Units," U.S. Patent No. 4950296, issued August 21, 1990 to
    Jonathan L. McIntyre, and assigned to UFTB on September 27, 1997.<PAGE>

                                                                    Exhibit 10.6

Confidential Treatment. The portions of this exhibit that have been replaced
with "[*****]" have been filed separately with the Securities and Exchange
Commission and are the subject of a request for confidential treatment.

                         MANAGEMENT SERVICES AGREEMENT

                                  -BONE PASTE -

      THIS MANAGEMENT SERVICES AGREEMENT (this "Agreement") effective on this 11
day of May,1998, by and between THE UNIVERSITY OF FLORIDA TISSUE BANK, INC.
("UFTB"), a Florida non-profit corporation, and SOFAMOR DANEK GROUP, INC., an
Indiana corporation ("SDG").

                                   WITNESSETH:

      WHEREAS, UFTB is a Direct Support Organization of The University Of
Florida.

      WHEREAS, UFTB's role as a Direct Support Organization of The University of
Florida will be significantly enhanced through the relationship with SDG as
agreed herein.

      WHEREAS, UFTB and SDG each acknowledge that the processing and use of
human tissue for human transplantation purposes is in the public interest and in
the interest of medicine generally and that the entering into of this Agreement
will enhance these interests through facilitating the availability of processed
tissue for use in spinal and cranial medical procedures (the "Field of Use") and
thereby advance the medical and scientific application thereof.

      WHEREAS, UFTB and SDG each desire that UFTB (i) process Bone Paste,
described in U.S. Patent Application S/N 08/816,079, dated March 13, 1997, for
use in spinal and cranial medical procedures (the "Bone Paste") and future line
extensions of the Bone Paste (jointly and severally herein, the "UFTB Paste
Product") and (ii) distribute such UFTB Paste Product in conjunction with
exclusive worldwide management services provided by SDG, all in accordance with
the terms and subject to the conditions contained herein. A description of the
Bone Paste is

[CONFIDENTIAL]
                                     1                                 4/28/98

<PAGE>

set forth on the attached Schedule A.

      WHEREAS, UFTB and SDG each desire that UFTB Paste Product be processed for
distribution throughout the world, except for the country of Italy (the
"Territory") in the Field of Use, subject to SDG's management services.

      NOW, THEREFORE, in consideration of the premises and the mutual agreements
contained herein, SDG and UFTB hereby agree as follows:

                                    ARTICLE I

                             COMMITMENTS AND LICENSE

      Section 1.1 Exclusive Commitments. UFTB hereby agrees to exclusively
permit SDG to perform Management Services (as defined in Section 3.1 hereof), in
the Territory and in the Field of Use, in connection with UFTB Paste Product
processed and distributed by UFTB, and SDG hereby agrees to perform Management
Services in connection with UFTB Paste Product processed and distributed by UFTB
in the Territory, subject to the terms and conditions of this Agreement. UFTB
further agrees to not license either directly or indirectly to other parties or
to distribute or utilize the management services of any third party in
connection with the distribution of the UFTB Paste Product or other products
comprised primarily from a UFTB Paste Product, which may have spinal and cranial
applications, without first demonstrating to SDG's reasonable satisfaction that
such products differ significantly from UFTB Paste Product and would, therefore,
have no adverse economic impact on SDG and/or otherwise, in any way, hinder
SDG's efforts to perform Management Services under this Agreement. If the
division president or equivalent of SDG either approves of the release of such
product or fails to respond

                                      2                                4/28/98

<PAGE>

to UFTB's demonstration and written request for approval of such product within
thirty (30) days of receipt of such proposed product information, UFTB will be
free to license to other parties, distribute, or utilize the management services
of any third party in connection with the distribution of such demonstrated
product and, in such event, UFTB shall first supply all SDG's demand according
to the Distribution Forecast as stated in Section 3.1(b) before supplying any
other party with such product.

      If even after UFTB's distribution or license of such product, SDG
demonstrates to UFTB that the distribution or license of such product has or is
likely to have an adverse economic impact on SDG or that such product is being
used in the Field of Use, then UFTB shall immediately take action to alleviate
said adverse economic impact or prevent such product's use in the Field of Use.
If such UFTB action fails to alleviate said adverse economic impact or prevent
such product's use in the Field of Use within six (6) months from the date of
SDG's written notification to UFTB of such adverse economic, UFTB shall
immediately terminate distribution or license of such product. Section 3.1(g)
shall have no applicability for the Contract Year or Contract Years in which
UFTB undertakes such action.

      Section 1.2 License of UFTB Marks. During the term of this Agreement, UFTB
grants to SDG a royalty-free, non-transferable license to use the mark
"University of Florida Tissue Bank" (the "UFTB Mark") in the Territory and in
the Field of Use in connection with SDG's provision of Management Services.

                                          3                             4/28/98

<PAGE>

                                   ARTICLE II

                               UFTB PASTE PRODUCT

      Section 2.1 UFTB Paste Product Specifications. All Bone Paste to be
distributed by UFTB using SDG's Management Services (as defined in Section 3.1
hereof) shall conform to and otherwise comply with the specifications set forth
in Schedule 2.1 hereto, and such Schedule 2.1 may be amended from time to time
by mutual written agreement of the parties (the "UFTB Paste Product
Specifications"). If any UFTB Paste Product that is not a current product is
distributed by UFTB pursuant to this Agreement, the parties hereto shall amend
Schedule 2.1 to set forth the specifications for such UFTB Paste Product, and
such UFTB Paste Product shall conform to and otherwise comply with the UFTB
Paste Product Specifications. If regulatory approval is required for any part or
all of the UFTB Paste Product in any country located in the Territory and if
such regulatory approval be refused, modified or withdrawn by the applicable
regulatory authorities of a country in the Territory, UFTB shall promptly notify
SDG of such refusal, modification or withdrawal and the parties shall negotiate
in good faith to amend appropriately the UFTB Paste Product Specifications;
provided, however, that in the event of any such refusal, modification or
withdrawal, UFTB may refuse to process or distribute that specific UFTB Paste
Product, and/or SDG may refuse to provide Management Services in connection with
such UFTB Paste Product, pending the resolution of such regulatory matter. In
the event of any such refusal, modification or withdrawal, UFTB shall use its
best efforts to favorably and promptly resolve such regulatory matter, which
best efforts shall include, but not be limited to, full communication to SDG of
all information and correspondence, except for materials subject to the

                                     4                                  4/28/98

<PAGE>

attorney-client privilege, relating to any issues raised by such refusal,
modification or withdrawal and full participation with SDG in connection with
the resolution of such regulatory matter.

      Section 2.2 UFTB Paste Product Warranties.

      (a) Compliance With Laws and Specifications. UFTB warrants that the UFTB
Paste Product will be processed, packaged, stored and shipped (i) suitable for
use in the treatment of osseous defects as prescribed by a physician for cranial
and spinal medical procedures in which human tissue is needed or used to replace
human tissue and (ii) in conformity in all respects with all applicable federal,
state and local laws, rules and regulations relating thereto, including
particularly the Federal Food, Drug and Cosmetic Act and the National Organ
Transplant Act, and the UFTB Paste Product Specifications pursuant to Section
2.1 hereof  warrants that UFTB the packaging of UFTB Paste Product will be in
conformity in all respects with the Packaging Specifications described in
Section 3.5 hereof

      (b) Authority; Licenses. UFTB further warrants that it is fully authorized
to enter into and perform this Agreement, that the UFTB Paste Product and any
manuals prepared by UFTB in connection with the UFTB Paste Product and made
available to recipients of the UFTB Paste Product (the "UFTB Customers") will
not violate or infringe upon any common law or statutory rights of any third
party, and that UFTB is the owner of all rights in and to the UFTB Mark.

      (c) Incorporated Materials. UFTB warrants that it has full right and
authority to incorporate all materials (e.g., human tissue) into the UFTB Paste
Product and that such raw materials shall be in full compliance with all
applicable federal, state and local laws, rules and

                                      5                                  4/28/98

<PAGE>

regulations and with the UFTB Paste Product Specifications.

      Section 2.3 Processing Capacity.

      (a) UFTB Paste Product. Schedule 2.3 sets forth UFTB's current as well as
projected processing capacity for the UFTB Paste Product by UFTB, in terms of
the number of units that may be processed, packaged and delivered by UFTB per
month.

      (b) Other UFTB Paste Product. If any UFTB Paste Product that is not a
current product is processed pursuant to this Agreement, the parties hereto
shall amend Schedule 2.3 by mutual agreement to set forth the information
required by Section 2.3(a) with respect to such product.

                                  ARTICLE III

            MANAGEMENT SERVICES IN CONNECTION WITH UFTB PASTE PRODUCT

Section 3.1 SDG's Management Services on Behalf of UFTB.

      (a) SDG's Rights and Responsibilities. SDG shall have the exclusive
responsibility to diligently facilitate the distribution of the UFTB Paste
Product, in the Territory and in the Field of Use, to UFTB Customers in
accordance with this Agreement (the "Management Services"). The Management
Services shall be comprised of(i) education, training, and marketing the UFTB
Paste Product, which Management Services may be combined with the marketing of
other SDG products and services; provided, however, that the UFTB Paste Product
will be distributed by UFTB separately from any SDG distributed products; (ii)
providing, either through employees or independent representatives of SDG,
customer service to UFTB Customers (e.g., responding to questions UFTB customers
may have concerning how the UFTB Paste

                                          6                           4/28/98

<PAGE>

Product were processed and the various surgical applications for which they are
designed), (iii) the facilitation of the shipment of UFTB Paste Product to UFTB
Customers in accordance with Sections 3.1(c) and 3.2 hereof Upon mutual
agreement of SDG and UFTB and subject to separate written agreements, SDG may
also provide UFTB with product design, professional management information
system and computer programming and installation support services. SDG reserves
the right to develop, at its sole discretion, non-exclusive management
arrangements for the UFTB Paste Product with selected third parties which third
parties will provide Management Services subject to all of the covenants,
agreements, obligations and commitments made by SDG hereunder, but in no case
shall such action require UFTB to incur any additional cost or expense and/or
increase the Management Service Fees as set forth in Section 3.4 under this
Agreement.

       (b) Distribution Forecast. To assist UFTB in planning, SDG shall
supply UFTB with month-by-month distribution forecasts ("Distribution
Forecast") in advance of each quarter. Distribution Forecasts for Contract
Years one, two, three, and four shall be based upon the distributions shown
in Section 3.3 (b) herein, which equate to quantities of [*****] in Contract
Year one; [*****] in Contract Year two; [*****] in Contact Year three; and
[*****] in Contract Year four. In the event that SDG changes or expects to
change any such Distribution Forecast, SDG shall promptly notify UFTB of the
extent of such change and UFTB shall have one hundred twenty (120) days from
such notification to adjust its production capacity in order to meet the
production requirements under

[CONFIDENTIAL]
                                     7                                  4/28/98

<PAGE>

the terms of this Agreement.

      (c) UFTB's Non-Compliance with Distribution Forecast.

            (i) UFTB shall endeavor to meet the Distribution Forecast. In the
event that UFTB is unable to supply the number of units of UFTB Paste Product
that SDG forecasted in any ninety (90) day period under the Distribution
Forecast, it shall designate no less than [*****] of its human tissue raw
materials allotted for all Bone Paste, and Bone Paste-type products produced
under U.S. Patent Application S/N 08/816,079, dated March 13, 1997, to the
Bone Paste.

            (ii) SDG may elect to assist UFTB in developing or finding an
additional donor base or to solve other such limiting factors for the
affected UFTB Paste Product for the time period during which UFTB is unable
to supply such affected UFTB Paste Product. If such time period exceeds
ninety (90) days, until such time that UFTB is again able to supply the
affected UFTB Paste Product as otherwise set forth in this Agreement, SDG
shall have the right to procure Bone Paste raw materials from sources other
than those customarily used by UFTB. SDG shall then provide all such procured
Bone Paste raw materials to UFTB and UFTB shall endeavor to produce the
affected UFTB Paste Product from such procured raw materials. UFTB shall pay
SDG a Management Service Fee equal to [*****] for UFTB Paste Products made
from such SDG procured raw materials, less all direct expenses related to
manufacturing same, including "Fully Loaded Manufacturing Costs". Fully
Loaded Manufacturing Costs shall mean all direct costs related to the
manufacturing and testing-laboratory process, including labor, matching
payroll taxes and employee benefits, materials and

[CONFIDENTIAL]
                                       8                               4/28/98

<PAGE>

supplies, and all manufacturing and testing-laboratory overhead costs including
apportioned manufacturing and testing-laboratory facilities space cost,
manufacturing and testing-laboratory equipment depreciation, and related
apportioned utilities and other overhead, exclusive of administrative and
marketing overhead items.

      (d) Procedures for Receiving UFTB Customer Instructions. SDG shall be
responsible for receiving UFTB Customers' orders which shall include shipping
requirements for the UFTB Paste Product sought to be obtained by such UFTB
Customers (the "UFTB Customer Instructions") in accordance with Section 3.2
hereof UFTB will maintain records of its distribution and shipment of the UFTB
Paste Product in accordance with generally accepted accounting principles.

      (e) Distribution of UFTB Paste Product. SDG will use its best efforts to
actively support the distribution and use of UFTB Paste Product consistent with
SDG's standards. SDG shall offer commission rates to SDG's sales personnel and
independent representatives with respect to The UFTB Paste Product distributed
to UFTB Customers, as the result of SDG's Management Services hereunder, equal
to or greater than the commission rates offered to such sales personnel and
independent representatives on any product that is the same or is substantially
similar in use to any product that SDG may then be marketing.

      (f) No Warranties. In connection with its provision of Management
Services, SDG agrees that it will give no warranties or representations as to
the UFTB Paste Product on behalf of UFTB, including without limitation, as to
quality, durability, merchantability, fitness for a particular use or purpose or
any other features of the UFTB Paste Product distributed by UFTB

                                     9                                  4/28/98

<PAGE>

pursuant to this Agreement. To ensure SDG's compliance with this Section 3.1
(f), SDG shall, prior to publication, deliver for UFTB's review, all printed
materials (the "Materials") associated or used in connection with the
distribution of the UFTB Paste Product, the use of the UFTB Mark, the
relationship between SDG and UFTB or The University of Florida and SDG and not
previously published by SDG. If UFTB responds within fifteen (15) working days
(excluding weekends and holidays) of UFTB's receipt of the Materials with its
written requests to amend the Materials to ensure SDG's compliance with this
Section 3.1(f), SDG shall diligently endeavor to incorporate those changes. If
UFTB either approves the Materials in writing or fails to respond within fifteen
(15) working days (excluding weekends and holidays) of receipt of the materials
sought to be approved, SDG will be free to use the Materials as originally
provided to UFTB.

       (g) Rights Becoming non-exclusive. If at the end of the first
Contract Year, as defined in Section 3.4 (1) herein, or any Contract Year
ending after that date, the total quantity of UFTB Paste Product distributed
pursuant to this Agreement is less than five million dollars ($5,000,000) for
that Contract Year, (a "Shortfall Contact Year"), UFTB may terminate the
exclusive rights portion of this Agreement with thirty (30) days written
notice to SDG, thereby rendering the Agreement a nonexclusive services
agreement and eliminating all restrictions on UFTB's ability to further
license or otherwise distribute the UFTB Paste Product to any other party,
provided that: (i) UFTB has processed quantities of UFTB Paste Product in
accordance with the Distribution Forecast for such Shortfall Contract Year
and its preceding Contract Year; and (ii) that within thirty (30) days of
written notification from UFTB that such Shortfall exists, SDG elects not to
pay UFTB a "make-up" dollar amount (such make-up dollar amount is the

[CONFIDENTIAL]
                                      10                               4/28/98

<PAGE>

product of A times B, wherein "A" is the difference between [*****] and the
actual Shortfall Contract Year distributions, and "B" is the difference
between [*****] and the Management Service Fee percentage in effect at the
time).

      (h) UFTB's Rights Under A Change to Non-Exclusivity In the event that
SDG's rights become non-exclusive as set forth in Section 3.1(g) herein: (i)
UFTB's obligation to supply all of SDG's demand according to the Distribution
Forecast before supplying any other party, as set forth in Section 1.1 herein,
shall promptly terminate; (ii) the provisions of Section 3.1(c) herein shall
promptly terminate and UFTB shall then determine the amount of UFTB Paste
Product available for SDG; and (iii) the management service fees set forth in
Section 3.4(a) herein may be recalculated by UFTB upon sixty (60) days written
notice to SDG from UFTB.

       Section 3.2 Ordering and Shipping Procedures.

      (a) Submission of UFTB Customer Instructions with SDG. UFTB Customers
shall submit UFTB Customer Instructions, for UFTB Paste Product, with SDG, in
SDG's role as exclusive Management Services provider. To the extent that a UFTB
Customer requests information concerning the purchase, sale or service of UFTB
Paste Product from UFTB directly, UFTB will direct such inquiry to SDG's
customer service telephone number, which number shall be answered by a SDG
customer service representative at SDG's offices in Memphis Tennessee. If SDG's
customer service representative determines that the inquiry involves a service
question that may be handled more expeditiously by one of SDG's independent
representatives rather than through SDG's offices, (i.e., because of geographic
proximity, expertise, etc.) that inquiry will be directed to that independent
representative. In the

[CONFIDENTIAL]
                                       11                             4/28/98

<PAGE>

case of a UFTB Customer seeking to receive UFTB Paste Product, the SDG customer
service representative will verify the inventory availability, pricing and
shipment details for the UFTB Paste Product ordered by the UFTB Customer.

      (b) Receipt and Resubmission of UFTB Customer Instructions by SDG~. Upon
receipt of UFTB Customer Instructions, SDG shall cause such UFTB Customer
Instructions to print at the UFTB Facility. UFTB may refuse acceptance of the
UFTB Customer Instructions, but only if UFTB has experienced an event of force
majeure pursuant to Section 7.4 hereof but only to the extent the event of force
majeure results in the inability of UFTB to supply UFTB Paste Product.

      (c) Contents and Priority of UFTB Customer Instructions. The UFTB Customer
Instructions submitted by SDG to UFTB in accordance with Section 3.2(b) shall
set forth the quantity of units of each UFTB Paste Product required to be
shipped by UFTB to each UFTB Customer, and the delivery date (or dates)
requested by the UFTB Customer. Such UFTB Customer Instructions may be submitted
by UFTB Customers only in accordance with Section 3.2(a) hereof. SDG agrees that
UFTB Customer Instructions relating to UFTB Paste Products that are submitted by
physicians practicing in hospitals affiliated with the University of Florida
shall be granted priority over other UFTB Customers if shortages of such UFTB
Paste Products exist; provided, however, that UFTB shall be required to first
fulfill any preexisting commitments to UFTB Customer Instructions before
granting such priority to hospitals affiliated with the University of Florida

      (d) Effect of UFTB Customer Instructions. In no event shall the use of any
form of

                                        12                             4/28/98

<PAGE>

UFTB Customer Instructions, invoice, shipping document, confirmation or waybill
be effective to vary, alter, modify or substitute for the terms and conditions
of this Agreement. All UFTB Customer Instructions shall be subject to, and shall
be deemed to incorporate, all terms and conditions of this Agreement, which may
be amended or waived only in accordance with Sections 7.2 and 7.6 hereof

       (e) Acknowledgement of UFTB Customer Instructions. All UFTB Customer
Instructions received by SDG and transmitted to UFTB shall be accepted by UFTB
within ten (10) calendar days, except to the extent acceptance of any UFTB
Customer Instructions is refused pursuant to Section 3.2(b) hereof UFTB shall
notify SDG of(i) the anticipated date for shipment of the UFTB Paste Product
related to each particular UFTB Customer Instructions, and (ii) the date of
shipment of the UFTB Paste Product related to each particular UFTB Customer
Instructions. Upon the shipment of UFTB Paste Product to each UFTB Customer,
UFTB shall provide SDG with a copy of the invoice sent to the UFTB Customer,
which invoice shall set forth (i) the amount invoiced for each UFTB Paste
Product, (ii) the quantity of each UFTB Paste Product, (iii) the fact that SDG
is acting on behalf of UFTB as a Management Service Provider, and (iv) that any
questions regarding the particular shipment of UFTB Paste Product subject to
UFTB Customer Instructions should be directed to SDG. SDG shall guarantee the
payment of all invoices sent to UFTB Customers (other than physicians practicing
in hospitals affiliated with the University of Florida) for UFTB Paste Product.
If SDG is unable to collect payment from UFTB Customers for such invoices
within one (1) year of the date of shipment of applicable UFTB Paste Product,
SDG shall remit payment of such invoice to UFTB, less the appropriate

                                      13                                4/28/98

<PAGE>

Management Services fees owed to SDG.

       Section 3.3 Consideration Paid by SDG for the Execution of this Agreement

      (a) As consideration for the rights granted to SDG hereunder by UFTB,
SDG shall first pay UFTB the initial sum of three million dollars ($3,000,000)
as follows:

            (i)  two million dollars ($2,000,000) shall be paid upon the
execution of this Agreement; and

            (ii) one million dollars ($1,000,000) shall be paid upon UFTB's
attainment of a fifteen thousand (15,000)cc inventory of Bone Paste. Such
inventoried Bone Paste shall be subject to efficacy standards mutually agreed
upon in advance, and in writing, by the parties. Any other provision of this
Agreement notwithstanding, UFTB shall have the right to withhold shipments of
Bone Paste to customers, until such 15,000cc inventory is attained, and such
action shall not be considered a default or breach by UFTB of any other
provision set forth herein;

            (iii) in the event that such 15,000cc inventory is not attained
by September 1, 1998 UFTB shall then have the right to terminate this
Agreement with thirty (30) days written notice to SDG.

      (b) The balance of the consideration due shall be determined and paid as
described herein: the balance due shall be defined as "X" wherein the value of
"X" will be proportional to the actual dollar value of UFTB Paste Product
distributed as measured against the dollar value of the Distribution Forecast
established herein, said Distribution Forecast being:

            (i) eight million dollars ($8,000,000) in Contract Year one;

            (ii) sixteen million dollars ($16,000,000) in Contract Year two;

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<PAGE>

            (iii) twenty million dollars ($20,000,000) in Contract Year three;
and

            (iv) twenty four million dollars ($24,000,000) in Contract Year
four. Each Contract Year that a Distribution Forecast is met the value of "X"
shall be four million nine hundred thousand dollars ($4,900,000) and the
$4,900,000 will be used as the base in computations herein; in each of
Contract Years one, two, three, and four, UFTB shall earn, and be promptly
paid within thirty (30) days from the end of that Contract Year, an amount
equal to twenty five percent (25%) of the $4,900,000 multiplied times the
proportional factor, the proportional factor being equal to the actual UFTB
Paste Product distributed divided by the Distribution Forecast for that
Contract Year {e.g. if, in Contract Year two, the actual UFTB Paste Product
distributed was $19,000,000 the proportional factor for Contract Year two
would be (19/16)=1.1875 multiplied times the annual factor of 25 times the
$4,900,000 base, or 1.1875 X .25 X $4,900,000=$1,454,687.50; as a further
example, if in Contract Year three, the actual UFTB Paste Product distributed
was only $15,000,000, the factor for Contract Year three would be (15/20)=.75
multiplied times the annual factor of .25 times the $4,900,000 base, or 75 X
 .25 X $4,900,000=$918,750.00}. The minimum dollar value of UFTB Paste Product
distributed in any Contract Year must be no less than three million dollars
($3,000,000) to qualify for any value of "X" being computed in that Contract
Year.

Section 3.4 Management Services Fees to be Paid by UFTB.

      (a) Amount of Management Services Fees. The management fees to be paid to
SDG by UFTB for the Management Services provided hereunder (the "Management
Services Fees") shall be payable with respect to all UFTB Customer Instructions
submitted by SDG to UFTB

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                                      15                               4/28/98

<PAGE>

according to the following:

            (i) beginning on the effective date of this Agreement and lasting
for five (5) consecutive Contract Years the Management Services Fee shall be
[*****] of the actual net invoiced amount (as determined in accordance with
Section 3.4(c)) from UFTB to UFTB Customers pursuant to this Agreement;
however, in the event that the weight-to-weight conversion of demineralized
bone matrix into gel produces average Bone Paste yields of less than [*****],
which method of calculation is set forth on and attached hereto as the "Yield
Study Calculation", then, in lieu of such [*****] Management Service Fee, SDG
shall earn a Management Service Fee equal to the difference between [*****]
and the actual net invoiced amount total per Production Batch (a Production
Batch is defined as a production quantity of Bone Paste greater than [*****]
but less than [*****]); in the event that Bone Paste yields are less than
[*****], SDG shall earn a Management Service Fee according to a formula
wherein A is divided by B and then multiplied by [*****], wherein "A" is
equal to the actual quantity of Bone Paste produced and "B" is equal to
[*****] {e.g. if the actual quantity produced equals [*****], then [*****]
and [*****]}; and such Management Service Fee is then equal to the difference
between [*****] and the actual net invoiced amount total per such reduced
yield Bone Paste batch.

            (ii) commencing on the first day of the sixth (6th) Contract Year
and for the remainder of the term of this Agreement, the Management Services
Fee shall be [*****] of the actual net invoiced amount (as determined in
accordance with Section 3.4 (c)) from UFTB to UFTB Customers pursuant to this
Agreement.

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                                     16                               4/28/98

<PAGE>

      (b) Contract Year. For the purposes of this Agreement, "Contract Year"
shall refer to the individual consecutive twelve-month periods of this
Agreement, the first of which commences on the effective date herein.

      (c) Net Invoiced Amount. As part of the Management Services provided to
UFTB, SDG will maintain a unique relationship within the market place for UFTB
Paste Product and is therefore obligated to consult with UFTB in order to assist
UFTB in establishing and publishing the net invoiced amount for UFTB Paste
Products to be paid by UFTB Customers, Likewise any new UFTB Paste Product that
is not a current product will have its net invoiced amount established by UFTB
after consultation with SDG. Changes in net invoiced amounts for any UFTB Paste
Product may be modified during the term of this Agreement upon the mutual
agreement of the parties.

      (d) SD&s Audit Rights. UFTB shall keep complete and accurate books and
records which allow verification of the amounts invoiced by UFTB to UFTB
Customers for UFTB Paste Product. SDG shall be permitted access to such books
and records during normal business hours and upon reasonable business hours
during the term of this Agreement in order to verify UFTB's compliance with the
terms of the Agreement and to permit SDG to satisfy its obligations under this
Agreement, including, but not limited to, determining the identifies of any
UFTB Customer that falls to pay payment of invoices so that SDG can guarantee
UFTB Customer payments to UFTB in accordance with Section 3.2(e) hereof SDG
shall have the right (no more often than once yearly and in any event within
three years after the close of the month to which the audit relates) to have an
audit performed during normal business hours and upon reasonable notice to

                                    17                                4/28/98

<PAGE>

UFTB of such books and records by an independent certified public accounting
firm mutually acceptable to the parties for the sole purpose of verifying the
correct and accurate payment of Management Service Fees which shall be the sole
matter reported by such accounting firm to SDG. The fees and expenses of the
accounting firm performing such verification shall be borne by SDG, except in
the event that the actual net invoiced amounts are understated by more than
$100,000 for such year, whereupon such fees and expenses shall be borne by UFTB.
UFTB shall within sixty (60) days of the results of such audit provide for
payment of amounts which are overpaid, unless a bona fide dispute exists as to
the results of such audit.

      (e) Payments in U.S. Dollars. All payments required by this Agreement
shall be made in United States Dollars.

      (f) UFTB Customer Payments. Payment terms related to shipments of UFTB
Paste Product to UFTB Customers shall be net 30 days from the later of the date
of invoice or the date of shipment.

      (g) Management Services Fee Payments. Payment to SDG by UFTB of
Management Service Fees shall be made within ten (10) days from the last day of
the month of UFTB's receipt of payment of an invoice with respect to UFTB
Customers Instructions submitted by SDG.

       Section 3.5 Packaging Specifications.

       UFTB shall supply all packaging and labeling information and designs,
including without limitation all art-work and pharmacological information, usage
instructions and warnings to be applied to each UFTB Paste Product (the
"Packaging Specifications"). Once a UFTB Paste Product is supplied and initially
packaged by UFTB, SDG will not, without UFTB's concurrence,

                                     18                               4/28/98

<PAGE>

remove, alter or modify any Packaging Specifications of such UFTB Paste Product
except in the case of SDG's own internal use.

      Section 3.6 Shipment, Right to Use and Risk of Loss.

      (a) Shipping. SDG shall issue customer shipping instructions to UFTB for
the IJFTE Paste Product in accordance with the UFTB Customer Instructions, using
SDG's or the UFTB Customer's choice of carriers FOB at the plant from which the
LIFTE Paste Product is shipped.

      (b) Right to Use and Risk of Loss. All right to use and risk of loss to
any UFTB Paste Product shall pass to the UFTB Customer upon a common carrier
accepting possession or control of such UFTB Paste Product

       Section 3.7 Rejected Product.

      (a) Procedure for Rejection. Within thirty (30) days after a UFTB
Customer's receipt of any shipment of UFTB Paste Product, SDG shall notify UFTB
in writing if a UFTB Customer chooses to reject all or any part of such shipment
of LIFTE Paste Product or, falling such notification, unless such UFTB Paste
Product has a latent defect, the UFTB Customer shall be deemed to have accepted
such shipment for all purposes. With respect to latent defects, SDG shall
promptly notify UFTB after a UFTB Customer's discovery thereof and such UFTB
Customer shall have the right to reject such UFTB Paste Product. Any
notification of rejection should be for valid technical or packaging reasons and
shall state the basis for the rejection. A replacement shipment of such UFTB
Paste Product so required by a UFTB Customer shall be made by UFTB as soon as
practicable using reasonable efforts (but no later than thirty (30) days after
UFTB receives such notification), or as soon thereafter as the raw materials are
available to

                                        19                            4/28/98

<PAGE>

UFTB for the processing of such replacement product. Such replacement UFTB Paste
Product shall be invoiced by UFTB and paid for by the LIFTE Customer at the same
fee as was the rejected shipment.

      (b) Effect of Rejection. The UFTB Customer shall not be obligated to pay
and SDG shall not be obligated to guarantee payment for any rejected shipment of
UFTB Paste Product shipped to UFTB Customers which falls to meet the UFTB Paste
Product Specifications or the Packaging Specifications or otherwise breaches the
UFTB Paste Product Warranties set forth in Section 2.2 hereof. The UFTB Customer
shall not be obligated to pay in full and SDG shall not be obligated to
guarantee payment for any shipment of the UFTB Paste Product rejected by a UFTB
Customer. UFTB shall have fifteen (15) days within which to notify SDG and the
UFTB Customer in writing of TJFTE's objection to such rejection, and the parties
shall thereafter promptly submit the issue to an independent laboratory in
accordance with subparagraph (c) below.

      (c) Testing to Resolve Conflicting Test Results. If there is a conflict
between the test results of UFTB and the test results of SDG or a UFTB Customer
with respect to any UFTB Paste Product, an adequate sample of same shall be
submitted by the party having possession thereof to an independent laboratory
acceptable to both parties for testing against the UFTB Paste Product
Specifications under procedures set out in the UFTB Paste Product
Specifications. The test results obtained by such laboratory shall be final with
respect to the obligations of the LTTB Customer to pay and of SDQ to guarantee
payment for such UFTB Paste Product. The fees and expenses of such laboratory
testing shall be bone entirely by The party against whom such

                                     20                                 4/28/98

<PAGE>

laboratory's findings are made. If the laboratory's findings are in favor of
UFTB, the UFTB Customer shall pay UFTB for the rejected UFTB Paste Product under
the terms listed in Section 3.4 hereto.

      (d) Return or Disposal of Rejected UFTB Paste Product. UFTB shall make
arrangement with SDG for the return or disposal, at UFTB's option, of any
shipment of any rejected UFTB Paste Product. The return shipping charges or
disposal costs for such rejected shipment of Product shall be paid by UFTB and,
in the event of agreement of the parties or a laboratory determination hereunder
that such rejected shipment does meet the UFTB Paste Product Specifications, the
UFTB Customer shall promptly reimburse UFTB for such shipping charges or
disposal costs.

      (e) No Waiver. No acceptance or rejection of product or determination of
compliance for purposes of this Section 3.7 shall serve to waive any rights
under Article VI.

      Section 3.8 Taxes. Taxes and any and all other tariffs and duties or
excise, sales or use, value added or other taxes or levies imposed upon UFTB in
connection with the process and distribution of the UFTB Paste Product shall be
paid by UFTB.

                                   ARTICLE IV

                       CERTAIN AGREEMENTS OF UFTB AND SDG

      Section 4.1 Deceptions. UFTB shall permit a representative of SDG to
inspect at reasonable times and as a reasonable frequency, those processing
facilities and methods and operations used by UFTB in connection with the UFTB
Paste Product as considered necessary or desirable by SDG for the purpose of
observing compliance with UFTB's undertakings set forth

                                      21                               4/28/98

<PAGE>

herein. No such observation shall serve to waive any rights of SDG or UFTB
hereunder.

      Section 4.2 Regulatorv Filings. UFTB shall fulfill all applicable
reporting and other requirements of regulatory agencies, self-regulatory
organizations or governmental entities that have jurisdiction with respect to
UFTB and the UFTB Paste Product. SDG shall cooperate in preparing any such
filings to the extent reasonably requested by UFTB.

      Section 4.3 Ownership of Intellectual Property Rights.

      (a) Intellectual Properly Rights. For purposes of this Agreement,
"Intellectual Property Rights" means all works, including literary works,
pictorial, graphic and sculptural works, architectural works, works of visual
art, and any other work that may be the subject matter of copyright protection;
advertising and marketing concepts; trademarks; information; data; formulas;
designs; models; drawings; computer programs; including all documentation,
related listings, design specifications and flow charts, trade secrets and any
inventions including all processes, machines, manufactures and compositions of
matter and any other invention that may be the subject matter of any pending
patent or patent; and all statutory protection obtained or obtainable thereon.

      (b) Ownership of Intellectual Property Rights. All Intellectual Property
Rights relating to the UFTB Paste Product shall be owned or obtained under
license by UFTB (subject to grants of licenses referred to herein) unless
jointly developed with SDG, in which case such intellectual property shall be
jointly owned by UFTB and SDG provided, however, that nothing in this Section
4.3 shall be construed or interpreted as granting in any manner or way any
rights to UFTB in any Intellectual Property Rights of SDG.

                                        22                             4/2S/98

<PAGE>

                                    ARTICLE V

                              TERM AND TERMINATION

      Section 5.1 Term. Unless terminated earlier in accordance with Section 5.2
herein, the term of this Agreement shall commence with the effective date herein
and shall continue until the latter of: (i) the expiration date of the U.S.
Patent that issues from U.S. Patent Application S/N 08/8 16,079, dated March 13,
1997, or any continuation, continuation-in-part, or divisional of such U.S.
Patent; or (ii) twenty (20) years from the effective date of this Agreement.

      Section 5.2 Early Termination. Either party hereto may terminate this
Agreement (a) due to a material breach by the other party of any of its
obligations or covenants hereunder upon 30 calendar days' notice to the
breaching party if such breaching party fails to remedy such breach within such
30 calendar days, or if such breach cannot be remedied within such 30 calendar
days, only if such breaching party has not undertaken good faith efforts to
remedy such breach or (b) upon the insolvency or filing for bankruptcy by the
other party. This Agreement may not be terminated without cause except as
specifically provided herein or by the mutual written agreement of the parties.

      Section 5.3 Accrued Obligations. In the event that this Agreement is
terminated pursuant to Section 5.2 hereof, the duties and obligations of the
breaching party which have accrued prior to termination, including without
limitation, the obligation to process and deliver quantities of the UFTB Paste
Product for which Customer Instructions have been validly issued prior to the
effective date of termination and the correlative obligation to pay for such
quantities, shall not be released or discharged by such termination.

                                        23                              4/28/98

<PAGE>

                                   ARTICLE VI

                                 INDEMNIFICATION

      Section 6.1 Indemnification by SDG. Subject to UFTB's indemnification
obligations pursuant to Section 6.2 hereof, SDG shall indemnify and hold UFTB
harmless from any and all losses, damages, liabilities, costs and expenses,
including, without limitation, reasonable attorneys fees and court costs, that
may result from any demand, claim or litigation relating to or resulting from
the Management Services provided by SDG.

      Section 6,2 Indemnification By UFTB.

      UFTB shall indemnify and hold SDG harmless from any and all losses,
damages, liabilities, costs and expenses, including, without limitation,
reasonable attorneys fees and court costs, that may result from any demand,
claim or litigation relating to, resulting from or arising out of(i) the failure
of any UFTB Paste Product to comply with the UFTB Paste Product Specifications,
(ii) a breach by UFTB of any warranty, representation or covenant made by UFTB,
including a breach by UFTB of the UFTB Paste Product warranties set forth in
Section 2.2 hereof or; (iii) the failure of the packaging related to any UFTB
Paste Product to comply with the Packaging Specifications.

      Section 6.3 Survival of Obligations. The respective obligations of the
parties hereto pursuant to Article VI shall survive the termination of this
Agreement.

                                   ARTICLE VII

                                  MISCELLANEOUS

      Section 7.1 Entire Agreement. This Agreement, together with the exhibits
and

                                       24                              4/28/98

<PAGE>

schedules hereto constitute the entire agreement of the parties hereto with
respect to the subject matter hereof and supersede any prior expression of
intent or agreement of the parties with respect thereof.

      Section 7.2 Amendments. This Agreement shall not be modified, altered, or
amended except by an agreement in writing signed by duly authorized
representatives of each of the parties hereto.

      Section 7.3 Governing Law: Jurisdiction. This Agreement shall be governed
by the laws of the State of Florida (regardless of the laws that might otherwise
govern under applicable principles of conflicts of law) as to all matters,
including but not limited to matters of validity, construction, effect,
performance and remedies. The parties agree to submit to personal jurisdiction
and to waive any objection as to venue and forum non convenes in the federal or
state courts of the State of Florida.

      Section 7.4 Force Majeure. Neither party shall be liable for
nonperformance or delay in performance due to and to the extent resulting from
an event of force majeure, including without limitation: any act of God;
regulation or law of any government; war, riot, or civil commotion; destruction
of production facilities or materials by fire, earthquake or storm; strike or
other labor disturbances; epidemic; failure of public utilities or common
carriers; or any limitation, requirement or prohibition imposed or required by
the United States Food and Drug Administration or any other governmental agency
asserting jurisdiction with regard to the UFTB Paste Product. In case any of the
foregoing occurrences should in any manner hinder either party hereto from
fulfillment of its obligations specified in this Agreement, said party shall
promptly

                                     25                              4/28/98

<PAGE>

give written notice to the other party. In the event that UFTB has experienced
an event of force majeure, and as a result hereof is unable to supply SDG with
any UFTB Paste Product, SDG may assist UFTB in the procurement of similar
product from another manufacturer.

      Section 7.5 Severability. In the event that any part of this Agreement
shall for any reason be finally adjudged by a court of competent jurisdiction or
determined by a governmental body to be invalid or unenforceable, then, unless
such part is deemed material by either or both parties, this Agreement shall
continue in effect and such part shall be excised hereof If either party
determines that such part hereof found to be invalid or unenforceable is
material to the operation or performance of this Agreement, then such party may,
by written notice to the other party, request that the parties attempt to
renegotiate this Agreement to alleviate or eliminate any difficulty caused to
such party by such invalidity or unenforceability.

      Section 7.6 Waiver. No failure or delay on the part of either party to
enforce any provision of this Agreement or to exercise any right granted hereby
shall operate as a waiver thereof unless or until the right to enforce any such
provision or to exercise any such right has been waived in writing by such
party. Any waiver of any provision hereof or right hereunder shall be effective
only in accordance with its terms and may be restricted in any way. No waiver of
any provision hereof or any right hereunder shall constitute a waiver of a
continuance or reoccurrence of the failure to perform, except as provided in
such waiver.

      Section 7.7 No Third Party Beneficiaries. This Agreement shall be
construed to be for the benefit of the parties hereto only and shall confer no
right or benefit upon any other person.

                                         26                            4/28/98

<PAGE>

      Section 7.8 Notices. Any notice, report or consent required or permitted
by this Agreement to be given or delivered shall be in writing and shall be
deemed given or delivered if delivered in person, or sent by courier or
expedited delivery service, or sent by registered or certified mail, postage
prepaid, return receipt requested, or sent by telecopy (if confirmed), as
follows:

       If to SDG:

             Sofamor Danek Group, Inc.

             1800 Pyramid Place

             Memphis, Tennessee 38132

             Attention: President and Chief Operating Officer

             Telecopy: 901-344-1570

       with a copy to:

             Vice President and General Counsel

             Sofamor Danek Group, Inc.

              1800 Pyramid Place

             Memphis, Tennessee 38132

             Telecopy:901-344-1576

       If to UFTB:

             University of Florida Tissue Bank, Inc.

             1 Progress Boulevard

             Box 31

                                         27                           4/28/98

<PAGE>
             Alachua, Florida 32615

             Attention: President and Chief Executive Officer

             Telecopy:904-462-5131

       with a copy to:

             Ms. Susan Collingwood

             Associate General Counsel

             University of Florida College of Medicine

             P.O. Box 100215

             Gainesville, Florida 32610

             Telecopy:  352-392-6482

      Any such notice, report or consent shall be effective upon delivery if
given or delivered in person, or sent by courier or expedited delivery service,
or upon receipt if sent by telecopy which is confirmed, or on the third business
day following mailing if mailed. Either party hereto may change its address for
purposes hereof by giving the other party written notice of such change as above
provided.

      Section 7.9 Assignment. Neither party may assign its rights and
obligations hereunder without the prior written consent of the other party and
such consent shall not be unreasonably withheld. No permitted assignment
hereunder shall be deemed effective until the assignee shall have executed and
delivered an instrument in writing reasonably satisfactory in form and substance
to the other party pursuant to which the assignee assumes all of the obligations
of the assigning party hereunder. Notwithstanding anything to the contrary in
this

                                       28                              4/28/98

<PAGE>

Section 7.9, either party may assign this Agreement or any of its rights or
obligations hereunder to a company which is a wholly owned subsidiary of the
assigning party.

      Section 7.10 Counterparts. This Agreement may be executed in two or more
counterparts, all of which shall be considered one and the same agreement, and
shall become effective when signed by each of the parties hereto.

      IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective duly authorized representatives as of the date
first written above.

UNIVERSITY OF FLORIDA TISSUE BANK, INC.

By:  /s/NANCY R. HOLLAND
   ----------------------------

Name:   NANCY R. HOLLAND
     --------------------------

Title:       CEO
      -------------------------

SOFAMOR DANEK GROUP, INC.

By:    /s/ MARK LoGUIDICE
   ----------------------------

Name:  MARK LoGUIDICE
     --------------------------

Title: EXECUTIVE VICE PRESIDENT
      -------------------------

                                       29                              4/28/98

<PAGE>
                               FIRST AMENDMENT TO
                          MANAGEMENT SERVICES AGREEMENT
                                 -- BONE PASTE -

      THIS IS AN AMENDMENT to the Management Services Agreement dated May 11.
1998 ("the Agreement") by and between Regeneration Technologies, Inc., a Florida
for-profit corporation ("RTI"), as assignee of The University of Florida Tissue
Bank, Inc. ("UFTB"), and Sofamor Danek Group, Inc. ("SDG"), in which the parties
agree as follows:

1.    After reconsideration of the terms and conditions of the Agreement, RTI
      and SDG agree to amend the Agreement, effective as of the date of
      signature of the parties to this Amendment ("Amended Effective Date"), as
      follows:

      a.    Add the following two sentences to Section 1 .2:

            During the term of this Agreement, RTl grants to SDG a royalty-free,
            non-transferable license to use the mark "Osteofil" (the "RTI Mark")
            in the Territory and in the Field of Use in connection with SDG's
            provision of Management Services. Upon termination of this Agreement
            the use of the RTI Mark shall revert to RTI.

      b.    Add the following new Sections 2.2(d) and 2.2(e):

            (d)   Paste Product Effectiveness. RTI represents and warrants that
                  to the best of its knowledge, the product is effective, i.e.
                  will form bone. RTl further represents and warrants that it
                  has no knowledge of any information that suggests the Paste
                  Product is not effective. RTI hereby agrees to disclose
                  promptly to SDG all information in RTI's possession or control
                  at any tune during the term of the Agreement that concerns the
                  use or effectiveness of UFTB Paste Products.

            (e)   Continuing Information. RTI further warrants that it will
                  promptly provide to SDG all pertinent information concerning
                  clinical or biological materials that exists as of the Amended
                  Effective Date of the Agreement and that comes into the
                  possession or control of RTI during the term of the Agreement.
                  Such information shall include information regarding next
                  generation products.

      c.    In Section 3.1f), line 8, change "Mark" to --Marks--.

      d.    In Section 3.3(a), line 2, change [*****].

      e.    In Section 3.3(a)(i), line 1, change "shall be" to --were-- ; and
            line 2, after "Agreement" insert --, receipt of which is hereby
            acknowledged by RTI--.

[CONFIDENTIAL]
                                       1
<PAGE>

      f     In Section 3.3(a)(ii), line 1, change [*****] shall be paid on
            the later of the Amended Effective Date or the date that RTI
            attains--.

      g.    Delete Section 3.3(a)(iii).

      h.    Delete existing Section 3.3(b) and substitute therefor the
            following:

            (b)   Development. Clinical and Marketing Costs. RTI shall bear all
                  costs associated with development of Paste Product which are
                  initiated or directed by, or approved in writing by, RTI,
                  including laboratory and bench top testing. SDG shall bear the
                  costs of legitimate marketing and clinical activities that are
                  initiated by SDG.

      i.    Change Sections 3.4(a)(i) and (ii) to read as follows:

            (i)   From the Amended Effective Date until the earlier of ninety
                  (90) days after RTI incorporates pooling of donors for
                  demineralized bones ("DBM") into the processing of UFTB Paste
                  Product, or the second anniversary of the Amended Effective
                  Date, the Management Services Fee shall be sixty percent (60%)
                  of the actual net invoiced amount (as determined in accordance
                  with section 3.4(c)) from RTI to RTI Customers pursuant to
                  this Agreement.

            (ii)  Commencing on the earlier of ninety (90) days after RTI
                  incorporates pooling of donors for demineralized bone ("DBM")
                  into the processing of UFTB Paste Product, or the second
                  anniversary of the Amended Effective Date, the Management
                  Services Fee shall be sixty-five percent (65%) of the actual
                  net invoiced amount (as determined in accordance with section
                  3.4(c)) from RTI to RTI Customers pursuant to this Agreement.

      j.    Add new Sections 3.4(iii) as follows:

            (iii) The costs associated with the purchase or manufacture of a
                  Product warmer (thermos) shall be shared by parties in
                  accordance with the percentages set forth in subparagraphs (i)
                  and (ii) of this Section 3.4(a), e.g., RH shall pay [*****] of
                  such costs until the earlier of ninety (90) days after RTI
                  incorporates pooling of donors for demineralized bone ("DBM")
                  into the processing of UFTB Paste Product, or the second
                  anniversary of the Amended Effective Date, and thereafter
                  [*****] of such costs. This Section 3.4(iii) shall be subject
                  to RTI approval in advance of the number and costs of the
                  Product warmers (thermos) planned by SDG, and payment of RTIs
                  share shall be upon or after the date costs are incurred by
                  SDG.

[CONFIDENTIAL]
                                       2
<PAGE>

      1.    Add the following to the end of Section 3.4(c):

                  SDG represents that it will exercise reasonable efforts to
                  obtain the maximum net invoiced amount for RTI Paste Products
                  consistent with its normal practice. SDG agrees to consult
                  with RTI and receive mutual consent of RTI and SDG, which
                  consent shall not be unreasonably withheld, before reducing
                  the net invoiced amount below [*****] of Paste Product.
                  In considering changes in the net invoiced amount for Paste
                  Product, the parties shall take into consideration changes in
                  relevant technology and nuances of the market.

      m.    Add new Section 4.3(c) as follows:

            (c)   RTI shall have no right to use any information disclosed to it
                  by SDG pursuant to this Agreement for any purpose other than
                  performance under this Agreement In the event RTI, for its own
                  purposes, desires to use some of SDG's information, RTI shall
                  submit to SDG a written request identifying the information
                  and the intended purpose, and upon receiving written authority
                  from SDG, which will not be unreasonably withheld, RTI may use
                  the identified information in accordance with the conditions,
                  if any, in the written authority.

      n.    All references in the Agreement to the "effective date" shall be
            amended to "Amended Effective Date".

      o.    In Section 7.8, add to the addresses for notice to RTI:

            Regeneration Technologies, Inc.
            One Innovation Drive
            Alachua, Florida 32615
            Attn:President and Chief Executive Officer
            Telecopy:  904-418-0342

      p.    In Section 7.9, last line, after "party" insert --or to a company
            that acquires by consolidation, merger, stock purchase or asset
            purchase substantially all of the assets or of the business of the
            assigning party associated with performance under this Agreement--.

      q.    Add new Section 7.11 as follows:

            7.11 Dispute Resolution. In the event of any dispute or controversy
            between the parties regarding performance under this Agreement or
            construction of the terms of this Agreement, the parties agree to
            first enter into discussions with each other with the good faith
            intention of resolving the dispute or controversy in an amicable,
            business-like manner. If, after ninety (90) days of such
            discussions, a resolution is not reached, the Chief Executive
            Officer of each party will

[CONFIDENTIAL]
                                        3
<PAGE>
            physically meet at a mutually convenient location to negotiate in
            good faith a resolution of the dispute or controversy.

      IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their duly authorized representatives.

Regeneration Technologies,Inc.                Sofamor Danek Group Inc.

By /s/ Richard R. Allen                       By /s/ Robert A. Compton
  ---------------------------                   ---------------------------
Name Richard R. Allen                         Name Robert A. Compton
    -------------------------                     -------------------------
Title  Sec/Treasurer/CFO                      Title  President &  COO
     ------------------------                      ------------------------

Date     11/16/98                             Date     11/13/98
-----------------------------                 -----------------------------

                                       4
<PAGE>

                         ASSIGNMENT AND ASSUMPTION OF
                   MANAGEMENT SERVICES AGREEMENT - BONE PASTE

      This ASSIGNMENT AND ASSUMPTION OF MANAGEMENT SERVICES AGREEMENT - BONE
PASTE (the "Assignment") is made and entered into this 11th day of' May, 1998,
by and between UNIVERSITY OF FLORIDA ORTHOPAEDIC TISSUE BANK, INC., d/b/a
UNIVERSITY OF FLORIDA TISSUE BANK, INC., a Florida not-for-profit corporation
("Assignor"), and REGENERATION TECHNOLOGIES, INC., a Florida for-profit
corporation ("Assignee").

                                   WITNESSETH:

      WHEREAS, Assignor and Assignee are parties to that certain Patent License
Agreement, dated January 23, 1998 (the "License Agreement"), pursuant to which
Assignor has agreed to license to Assignee the patents or pending patents listed
in Exhibit "A" attached hereto and made a part hereof on the condition that
Assignee meets certain financing goals; and

      WHEREAS, pursuant to the License Agreement, Assignor has agreed to assign
to Assignee all of Assignor's right, title and interest in, and all of its
obligations under, that certain Management Services Agreement - Bone Paste, by
and between Assignor and Sofamor Danek Group, Inc. ("SDG"), dated May 11, 1998,
a copy of which is attached as Exhibit B (the "SDG Bone Paste Contact") (with
certain exceptions) upon the terms and conditions set forth herein; and

      WHEREAS, pursuant to the License Agreement, Assignee has agreed to accept
such assignment and to assume all of the obligations of Assignor under the SDG
Bone Pasta Contact (with certain exceptions) upon the terms and conditions set
forth herein; and

<PAGE>

            WHEREAS, Assignor is willing to assign the SDG Bone Paste Contract
and Assignee is willing to accept such assignment of the SDG Bone Paste Contract
and to assume all obligations of Assignor under the SDG Bone Paste Contract upon
the terms and conditions set forth herein.

            NOW, THEREFORE, in consideration of the mutual promises and
covenants contained herein, the parties hereto agree as follows:

      1. Recitals. The recitals set forth above are true and correct in all
respects and are incorporated herein as filly as if set forth herein verbatim,

      2. Assignment and Assumption of SDG Bone Paste Contracts. Assignor hereby
assigns, transfers, conveys and delivers to Assignee all of Assignor's right,
title and interest in, to and under the SDG Bone Paste Contract, effective on
the Effective Date of this Assignment described in Paragraph 4 below, except as
otherwise provided in Paragraph 3 below. Assignee hereby assumes all of the
obligations, terms and covenants set forth in the SDG Bone Paste Contract to be
observed and performed by Assignor and agrees to be bound by the terms,
conditions and covenants of the SDG Bone Paste Contract arising from and after
the Effective Date, except as otherwise provided in Paragraph 3 below.

      3. Exceptions from Assignment Assignor shall retain and shall not assign
hereunder the following rights and obligations under the SDG Bone Paste Contract
(terms defined in the SDG Bone Paste Contract have the same meanings in this
Paragraph 3), as set forth in the following Sections of the SDG Bone Paste
Contract:

            (a) Section 1.2. Assignor shall retain the obligation to grant
      a license to Danek to use the UFTB Mark.

                                       -2-
<PAGE>

            (b) Section 2.1 Assignor shall retain the right to approve any
      amendments to Schedule 2.1.

            (c) Section 2.2(b). Assignor shall remain the owner of all rights in
      and to the UFTB Mark.

            (d) Section 2.3(b). Assignor shall retain the right to approve any
      amendments to Schedule 2.3.

            (e) Section 3.1(f) Assignor shall retain the right to review and
      respond to Danek regarding any advertising using the UFTB Mark or the
      relationship between Denek and Assignor or Denek and the University of
      Florida.

            (f) Section 3.1(g). Assignor shall retain the right to terminate
      the SDG Bone Paste Contract in accordance with Section 3.1(g) of the SDG
      Bane Paste Contract.

            (g) Section 3.5. Assignor shall retain the right to approve any
      changes to the Packaging Specifications.

            (h) Section 4.2. Assignor shall retain the right to approve any
      reporting or other requirements with respect to the UFTB Products.

            (i) Section 4.3(b) Assignor shall retain ownership of all
      Intellectual Property Rights relating to the UFTB Products.

      4. Effective Date. The assignment and assumption described in this
Assignment shall be effective (the "Effective Date") on the later of (a) the
effective date of the license granted pursuant to the License Agreement, or (b)
the date of this Assignment. In the

                                       -3-
<PAGE>

event that the license granted pursuant to the License Agreement does not become
effective, then the assignment hereunder shall not become effective.

      5. Termination and Breach. Any termination of the License Agreement shall
cause a simultaneous termination of this Assignment, without any further action
by Assignor or Assignee. Assignee acknowledges that Assignor may terminate the
License Agreement (which shall also cause a termination of this Assignment) upon
any material breach of this Assignment by Assignee. A breach by Assignee of any
of the obligations under the SDG Bone Paste Contract assumed by Assignee
hereunder shall be a material breach of this Assignment. During the term of this
Assignment, Assignor shall have the right at any reasonable time to review
Assignee's records to determine whether Assignee is complying with all
obligations of SDG. Bone Paste Contact assigned hereunder, and to confirm
with SDG representatives Assignee's compliance with the terms of' the SDG Bone
Paste Contract assigned hereunder.

      6. Assignment and Assumption Upon Termination. Upon any termination of
this Assignment the parties agree that such termination shall have the following
effect, without any other action required by Assignor or Assignee:

            (a) Assignee shall assign, transfer, convey and deliver to Assignor
the rights of Assignor under the SDG Bone Paste Contract that are assigned to
Assignee hereunder, effective on the date of termination of this Assignment; and

            (b) Assignor shall assume and shall be bound by all of the
obligations, terms and covenants set forth in the SDG Bone Paste Contract to be
observed and performed by Assignor and that were assumed by Assignee hereunder,
effective on the termination of this Assignment.

                                       -4-

<PAGE>

      7. Indemnification. Assignor hereby agrees to indemnify and hold Assignee
harmless from any and all claims, demands, damages, cost, losses, expenses,
liabilities and obligations of any kind or nature whatsoever (including
reasonable attorneys' fees incurred by Assignee) incurred by Assignee as a
result of any breach by Assignor of any warranty, representation, covenant or
agreement of Assignor contained in this Assignment or the failure of Assignor to
fulfill its obligations pursuant to the SDG Bone Paste Contract prior to the
Effective Date. Assignee agrees to indemnify and hold Assignor harmless from any
and all claims, demands, damages, costs, losses, expenses, liabilities and
obligations of any kind or nature whatsoever including reasonable attorneys fees
incurred by Assignor) incurred by Assignor as a result of the breach by
Assignee of any covenant or agreement of Assignee contained in this Assignment
or the failure of Assignee to fulfill its obligations pursuant to the SDG Bone
Paste Contract arising from and after the Effective Date.

      8. Attorneys' Fees. Should either party to this Assignment bring suit for
the breach of a promise, covenant, warranty or representation hereunder, it is
agreed that the successful party in such suit shall be entitled, in addition to
recovering any damages sustained thereby, to recover such party's expenses,
including court costs and reasonable attorneys' fees as part of the judgment or
other settlement. Expenses and attorneys' fees include those incurred prior to
the initiation of suit and those incurred in connection with proceedings in
courts of original jurisdiction and courts of appeal.

      9. Binding Effect This Assignment shall be binding upon and shall inure
to the benefit of, the parties hereto and their respective successors and
assigns.

                                       -5-
<PAGE>

      10. Governing Law and Venue. This Assignment shall be governed by, at
construed in accordance with, the laws of the State of Florida, and venue for
any legal proceeding or action at Law arising out of or construing this
Assignment shall lie in the state courts of Alachua County, Florida, or the
United States District Court forte Northern District of Florida, Gainesville
Division.

      IN WITNESS WHEREOF, the parties hereto have caused this Assignment to be
executed as of the date and year first above written.

Signed, sealed and delivered
in the presence of                "Assignor"

                                  UNIVERSITY OF FLORIDA ORTHOPAEDIC
                                  TISSUE BANK, INC., d/b/a UNIVERSITY OF
                                  FLORIDA TISSUE BANK, INC., a Florida not-for-
                                  profit corporation

                                  By: Frank P.Glowczewski Jr.
--------------------------            --------------------------
                                      Frank P.Glowczewski Jr., Chairman of the
                                      Board
-------------------------
                                  "Assignee"

                                  REGENERATION TECHNOLOGIES, INC., a
                                  Florida for-profit corporation

                                  By: /s/James M. Grooms
--------------------------            --------------------------
                                      James M. Grooms, President

--------------------------

                                       -6-
<PAGE>
                             CONSENT TO ASSlGNMENT

      The undersigned hereby consents to the assignment in the above ASSIGNMENT
MANAGEMENT SERVICES AGREEMENT - BONE PASTE, as required by Section 7.9 of the
Management Services Agreement.

                                   SOFAMOR DANEK GROUP, INC.

                                   By: /s/ Mark LoGuidice
-----------------------               --------------------------------
                                      Name:   Mark LoGuidice
-----------------------                    ---------------------------
                                      Title: Executive Vice President
                                           ---------------------------

                                       7-
<PAGE>
                                  Exhibit "A"

1.    "Diaphysial Cortical Dowel," invented by Nicholas E. Grivas and James M.
      Grooms, Docket No. TB-100, U.S. Patent Application S/N 08/587,070, dated
      January 16,1996, subject to that certain Management Services Agreement by
      and between UFTB and Sofamor Danek Group, Inc., dated effective July 23,
      1996, as amended April 21, 1997 (the "SDG Spinal Contract"), and subject
      to that certain Processing License Agreement by and between UFTB and
      AlloSource, Inc., dated January 1, 1997;

2.    "Bone Paste," invented by John F. Wironen and James M. Grooms, Docket No.
      TB-101, U.S. Patent Application S/N 08/816,079. dated March 13, 1997,
      subject to that certain Agreement by and between UTB and Exatech, Inc.,
      dated effective April 22, 1997, which is also owned by the University of
      Florida (the "University");

3.    "Cortical Bone Interference Screw," invented by lames M. Grooms, Kevin
      Carter and David H. Dulebobn, Docket No. TB-102, U.S. Patent Application
      S/N 08/687,01 28, dated July 16, 1996, subject tote SDG Spinal Contract;

4.    "Open Intervertebral Spacer," invented by John R. Bianchi, Kevin C.
      Carter, Bradley T. Estes, Larry Boyd and John A. Pafford, Docket No.
      TB-103, U.S. Patent Application S/N not available, dated June 3, 1997,
      subject to that certain Joint Ownership Agreement, between UFTB and Danek
      Medical, Inc., dated June 12, 1997, and the SDG Spinal Contract;

5.    "Cortical Bone Cervical Smith-Robinson Fusion Implant," invented by James
      M. Grooms, Kevin C. Carter, David H. Dulebohn and Torn Sander, Docket No.
      TB-104, U.S. Patent Application S/N 08/920,630, dated August 27, 1997,
      subject to the SDG Spinal Contract;

6.    "Segmentally Demineralized Bone Implant," invented by James M. Grooms,
      Kevin C. Carter and Thomas W. Sander, Docket No. TB-lO5, U.S. Patent
      Application S/N 08/958,364, filed October 27, 1997;

7.    "Cervical Tapered Dowel," Docket No. TB-106, subject to the SDG Spinal
      Contract;

8.    "Bane Grafting Units," U.S. Patent No. 4950296, issued August 21, 1990 to
      Jonathan L. Mcintyre, and assigned to (UFTB on September 27, 1997.

<PAGE>

                                  Exhibit "B"

           Management Services Agreement - Bone Paste, by and between
              University of Florida Orthopaedic Tissue Bank, Inc.,
                  d/b/a University of Florida Tissue Bank, Inc.
                          and Sofamor Danek Group, Inc.

                                 (Copy Attached)

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