Document:

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                                                                   Exhibit 10.2
                              SECURITY AGREEMENT

     This SECURITY AGREEMENT is made and entered into as of this 14th day of
January 2000, by and among CLINICAL NEURO SYSTEMS HOLDINGS LLC, a Delaware
limited liability company (the "Borrower"), and CLINICAL NEURO SYSTEMS, INC.,
a Delaware corporation ("CNS"), and George Connell ("Connell") (and together
with CNS, the "Secured Party").

                                 Background:

     1. The Borrower and the Secured Party are parties to an Asset Purchase
Agreement dated as of January 14, 2000 (the "Asset Purchase Agreement"),
pursuant to which the Borrower is purchasing substantially all of the assets
of CNS for $4,004,000 in cash plus a promissory note (the "Note") in the
principal amount of $2,800,000.

     2. CNS is willing to accept the Note in payment for a portion of the
purchase price under the Asset Purchase Agreement only on the condition that
the Borrower executes and delivers this Security Agreement to the Secured
Party.

     3. Capitalized terms which are used herein without definition shall have
the meanings ascribed to them in the Asset Purchase Agreement. Other terms
used herein without definition that are defined in the Uniform Commercial
Code, as enacted in Pennsylvania and in effect on the date hereof (the
"Uniform Commercial Code"), shall have the meanings ascribed to them therein,
unless the context requires otherwise.

     NOW, THEREFORE, intending to be legally bound, the Borrower and the
Secured Party hereby agree as follows:

     Section 1. Creation of Security Interest. The Borrower hereby grants to
the Secured Party a lien and security interest in and to the property
hereinafter described, whether now owned or hereafter acquired or arising
(excluding hereafter acquired customer lists as set forth in subsection (g)
below) and wherever located ("Collateral"):

        (a) all inventory, whether raw materials, work-in-process, finished
goods, parts or supplies or otherwise; all goods, merchandise and other
property held for sale or lease or to be furnished under any contract of
service; all documents of title covering any goods that are or are to become
inventory and any such goods which are leased or consigned to others and all
returned, reclaimed or repossessed goods sold, consigned, leased or otherwise
furnished by the Borrower to others ("Inventory");

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        (b) all leases and rental agreements for personal property between the
Borrower as lessor (whether by origination or derivation) and any and all
persons or parties as lessee(s), and all rentals, purchase option amounts,
and other sums due thereunder; and all inventory, equipment, goods and
property subject to such leases and rental agreements and all accessions,
parts and tools attached thereto or used therewith and all of the Borrower's
residual or reversionary rights therein;

        (c) all machinery, equipment, furniture, fixtures, tools and all
accessories, parts and equipment now or hereafter attached thereto or used in
connection therewith, whether or not the same shall be deemed affixed to real
property, and all other tangible personal property ("Equipment");

        (d) all general intangibles, which term shall have the meaning given to
it in the Uniform Commercial Code and shall additionally include but not be
limited to all patents, trademarks, service marks, trade names, copyrights
and other intellectual property and proprietary rights;

        (e) all replacements, attachments, accretions, accessions, components
and substitutions to or for any Inventory or Equipment;

        (f) all books and records evidencing or relating to the foregoing,
including, without limitation, the customer list of the Borrower as
constituted on the date hereof, data storage and processing media, software
and related material, including computer programs, computer tapes, cards,
disks and printouts, and including any of the foregoing that are in the
possession of any affiliate or any computer service bureau; and

        (g) all proceeds, which term shall have the meaning given to it in the
Uniform Commercial Code and shall additionally include, but not be limited
to, whatever is received upon the use, lease, sale, exchange, collection or
other utilization or any disposition of any of the collateral described in
subparagraphs (a) through (e) above, whether cash or noncash, and including
without limitation, rental or lease payments, accounts, chattel paper,
instruments, documents, contract rights, general intangibles, equipment and
insurance proceeds, and all such proceeds of the foregoing, but excluding
proceeds of Inventory ("Proceeds").

     Section 2. Secured Obligations. The security interest created herein is
given as security for the prompt payment, performance, satisfaction and
discharge of the following obligations ("Obligations") of the Borrower:

        (a) to pay all obligations and liabilities of the Borrower to the
Secured Party under the Note and this Security Agreement in accordance with
the terms thereof; and

                                       -2-

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        (b) to reimburse the Secured Party, on demand, for all of the Secured
Party's expenses and costs, including the reasonable fees and expenses of its
counsel, in connection with the enforcement of the Note and this Security
Agreement.

     Section 3. Representations and Warranties. The Borrower represents and
warrants as follows:

        (a) Good Title to Collateral. The Secured Party has transferred to the
Borrower pursuant to the Asset Purchase Agreement good and marketable title
to the Collateral, free and clear of all liens and encumbrances other than
the security interests granted to the Secured Party hereunder.

        (b) Location of Books and Records. The locations of the offices where
the Borrower maintains its books and records concerning the Collateral are as
set forth in Exhibit A or at the location(s) hereafter disclosed to the Secured
Party pursuant to Section 5.03 hereof.

        (c) Chief Executive Office. The chief executive offices of the Borrower
are at the address set forth in Exhibit A or at the location(s) hereafter
disclosed to the Secured Party pursuant to Section 5.03 hereof.

        (d) Location of Inventory and Equipment. All Inventory and Equipment of
the Borrower is located at one or more of the addresses set forth in Exhibit A
or at the location(s) hereafter disclosed to the Secured Party pursuant to
Section 5.03 hereof.

     Section 4. Disposition and Use of Collateral.

        (a) Inventory. The Borrower shall be permitted to process and sell the
Inventory, but only to the extent that such processing and sale are conducted
in the ordinary course of the Borrower's business.

        (b) Equipment. The Borrower shall be permitted to use the Equipment in
the ordinary course of its business.

     Section 5. Covenants and Agreements of the Borrower.

                                     -3-
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        (a) Maintenance and Inspection of Books and Records. The Borrower shall
maintain complete and accurate books and records and shall make all necessary
entries therein to reflect the costs, values and locations of its Inventory
and Equipment and all payments, credits and adjustments thereto. The Borrower
shall keep the Secured Party fully informed as to the location of all such
books and records and shall permit the Secured Party and its authorized
agents, at any reasonable time upon at least two business days' notice to
inspect, audit and make copies of all books and records, data storage and
processing media, software, printouts, journals, orders, receipts, invoices,
correspondence and other documents and written or printed matter related to
any of the Collateral. The Secured Party's rights under this Section 5.01
shall be enforceable at law or in equity, and the Borrower consents to the
entry of judicial orders or injunctions enforcing specific performance of
such obligations under this Section 5.01.

        (b) Insurance of Collateral. The Borrower shall keep its Inventory and
Equipment insured against such perils, in such amounts and with such
insurance companies as Borrower deems appropriate to protect the respective
interests of the Borrower and the Secured Party. All insurance policies shall
name the Secured Party as lender loss payee and shall provide for not less
than 30 days' advance notice in writing to the Secured Party of any
cancellation thereof. The Secured Party shall have the right (but shall be
under no obligation) to pay any of the premiums on such insurance if Borrower
fails to do so. Any premiums paid by the Secured Party shall, if the Secured
Party so elects, be considered an advance at the highest rate of interest
provided in the Note, and all such advances shall be payable on demand. The
Borrower expressly authorizes its insurance carriers to pay proceeds of all
insurance policies covering any or all of the Collateral directly to the
Secured Party.

        (c) New Locations of Collateral and Books and Records. The Borrower
shall immediately notify the Secured Party of any change in the location of
its chief executive office, of any new or additional address where its books
and records concerning the Collateral are located and of any new locations of
Inventory or Equipment not specified in Sections 3.02, 3.03 or 3.04 of this
Security Agreement, and if any such location is on leased or mortgaged
premises, promptly furnish the Secured Party with landlord's or mortgagee's
waivers in form and substance reasonably satisfactory to the Secured Party.

        (d) Perfection of the Secured Party's Interests. The Borrower agrees to
cooperate and join with the Secured Party in taking such steps as are reasonably
necessary, in the Secured Party's judgment, to perfect or continue the perfected
status of the security interests granted hereunder, including, without
limitation, the execution and delivery of any financing statements, amendments
thereto and continuation statements, the obtaining of landlords' and mortgagees'
waivers reasonably required by the Secured Party, the notation of encumbrances
in favor of the Secured Party on certificates of title, and the execution and
filing of any collateral assignments and any other instruments reasonably
requested by the Secured Party to perfect its security interest in the
Collateral. The Secured Party is expressly authorized to file financing
statements without the Borrower's signature.

                                     -4-
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        (e) Maintenance of Inventory and Equipment. The Borrower shall care for
and preserve the Inventory and Equipment in good condition and repair,
ordinary wear and tear excepted, and will pay the cost of all replacement
parts, repairs to and maintenance of the Equipment. The Borrower will keep
complete and accurate maintenance records with respect to the Equipment.

        (f) Reimbursement and Indemnification. The Borrower agrees to reimburse
the Secured Party on demand for out-of-pocket expenses incurred in connection
with the Secured Party's exercise of its rights under this Security
Agreement. The Borrower agrees to indemnify the Secured Party and hold it
harmless against any costs, expenses, losses, damages and liabilities
(including reasonable attorney's fees) incurred in connection with this
Security Agreement, other than as a direct result of the Secured Party's
gross negligence or willful misconduct.

     Section 6. Power of Attorney. The Borrower hereby appoints the Secured
Party as its lawful attorney-in-fact to do, at the Secured Party's option,
and at the Borrower's expense and liability, all acts and things that the
Secured Party may deem necessary or desirable to effectuate its rights under
this Security Agreement, including without limitation, (a) file financing
statements and otherwise perfect any security interest granted hereby, (b)
correspond and negotiate directly with insurance carriers, (c) upon the
occurrence of a default hereunder, communicate with third parties for the
purpose of protecting or preserving the Collateral, and (d) upon the
occurrence of a default hereunder, in the Borrower's or the Secured Party's
name, to demand, collect, receive, and receipt for, compound, compromise,
settle and give acquittance for, and prosecute and discontinue or dismiss,
with or without prejudice, any suit or proceeding with any third party
respecting any of the Collateral.

     Section 7. Default. The occurrence of any one or more of the following
shall be a default hereunder:

        (a) Default Under Agreement. The occurrence of a default or Event of
Default under the Note.

        (b) Failure to Observe Covenants. The failure of the Borrower to keep,
observe or perform any provisions of this Security Agreement, which failure
is not cured and remedied within 15 days after notice thereof is given to the
Borrower.

        (c) Representations and Warranties. If any representation, warranty or
certificate furnished by the Borrower under or in connection with this
Security Agreement shall, at any time, be false or incorrect in any material
respect and shall not have been cured and remedied within 15 days after
notice thereof is given to the Borrower.

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        (d) Secured Party's Rights upon Default. Upon the occurrence of a
default hereunder and at any time thereafter that a default is continuing,
the Secured Party may immediately and without notice do any or all of the
following, which rights and remedies are cumulative, may be exercised from
time to time that a default is continuing, and are in addition to any rights
and remedies available to the Secured Party under the Asset Purchase
Agreement or the Note:

        (e) Uniform Commercial Code Rights. Exercise any and all of the rights
and remedies of a secured party under the Uniform Commercial Code, including
the right to require the Borrower to assemble the Collateral and make it
available to the Secured Party at a place reasonably convenient to the
parties.

        (f) Operation of Collateral. Operate, utilize, recondition and/or
refurbish (at the Secured Party's sole option and discretion and in any
manner) any of the Collateral that is Equipment, for the purpose of enhancing
or preserving the value thereof or the value of any other Collateral.

        (g) Sale of Collateral. Upon ten calendar days' prior written notice to
the Borrower, which the Borrower hereby acknowledges to be sufficient,
commercially reasonable and proper, sell, lease or otherwise dispose of any
or all of the Collateral at any time and from time to time at public or
private sale, with or without advertisement thereof, and apply the proceeds
of any such sale first to the Secured Party's expenses in preparing the
Collateral for sale (including reasonable attorneys' fees) and second to the
complete satisfaction of the Obligations. The Borrower waives the benefit of
any marshaling doctrine with respect to the Secured Party's exercise of its
rights hereunder. Upon the occurrence of a default hereunder, and at any time
thereafter that a default is continuing, the Borrower grants a royalty-free
license to the Secured Party for all patents, service marks, trademarks,
trade names, copyrights, computer programs and other intellectual property
and proprietary rights sufficient to permit Secured Party to exercise all
rights granted to Secured Party under this Section.

        (h) Notices. Any written notices required or permitted by this Security
Agreement shall be effective if delivered in accordance with paragraph 8 of
the Note.

     Section 8. Miscellaneous.

        (a) No Waiver. No delay or omission by the Secured Party in exercising
any right or remedy hereunder shall operate as a waiver thereof or of any
other right or remedy, and no single or partial exercise thereof shall
preclude any further exercise thereof or the exercise of any other right or
remedy.

                                     -6-
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        (b) Successors. The provisions of this Security Agreement shall inure to
the benefit of and be binding upon the Secured Party and the Borrower and
their respective successors and assigns, provided that the Borrower's
obligations hereunder may not be assigned without the written consent of the
Secured Party. The Borrower acknowledges that CNS intends to liquidate and
dissolve promptly after the date of this Agreement, whereupon CNS intends to
distribute the Note and its rights under the Asset Purchase Agreement and
this Agreement to George J. Connell, its sole stockholder. Upon such
distribution, George J. Connell shall be the Secured Party hereunder.

        (c) Amendments. No modification, rescission, waiver, release or
amendment of any provisions of this Security Agreement shall be effective
unless set forth in a written agreement signed by the Borrower and an
authorized officer of the Secured Party.

        (d) Governing Law. This Security Agreement shall be construed under the
internal laws of the Commonwealth of Pennsylvania without reference to
conflict of laws principles.

        (e) Severability. If any provision of this Security Agreement shall be
held invalid or unenforceable under applicable law in any jurisdiction, such
invalidity or unenforceability shall not affect the validity or
enforceability of such provision in any other jurisdiction or the validity or
enforceability of any other provision of this Security Agreement that can be
given effect without such invalid or unenforceable provision.

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     IN WITNESS WHEREOF, the parties hereto have caused this Security
Agreement to be executed and delivered by their authorized officers the day
and year first above written.

                                           CLINICAL NEURO SYSTEMS
                                           HOLDINGS LLC

                                           By: Integra LifeSciences Corporation,
                                               its sole member

                                           By:
                                               ---------------------------------
                                               Stuart M. Essig
                                               Chief Executive Officer

                                           CLINICAL NEURO SYSTEMS, INC.

                                           By:
                                               ---------------------------------
                                               George J. Connell
                                               President

                                           -------------------------------------
                                           GEORGE J. CONNELL

                                     -8-
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                                  EXHIBIT A
                                  ---------

Location of books and records:

309 Commerce Drive
Exton, PA 19341

Location of chief executive office:

309 Commerce Drive
Exton, PA 19341

Location of Inventory and Equipment:

309 Commerce Drive
Exton, PA 19341

                                       -9-<PAGE>

                                                                    Exhibit 10.3
                            COLLATERAL ASSIGNMENT

     COLLATERAL ASSIGNMENT (this "Assignment") dated January 14, 2000 from
CLINICAL NEURO SYSTEMS HOLDINGS LLC, a Delaware limited liability company
(the "Assignor"), to CLINICAL NEURO SYSTEMS, INC., a Delaware corporation
("CNS"), and GEORGE J. CONNELL ("Connell"; together with CNS, the
"Assignee").

                                  BACKGROUND

     A. The Assignor and the Assignee are parties to an Asset Purchase
Agreement dated as of January 14, 2000 (the "Asset Purchase Agreement"),
pursuant to which the Assignor is purchasing substantially all of the assets
of CNS for $4,004,000 in cash plus a secured promissory note (the "CNS Note")
in the principal amount of $2,800,000.

     B. Assignor is the holder of a subordinated promissory note payable to
Assignor by its sole member, Integra LifeSciences Corporation ("Integra"), in
the principal sum of $2,800,000 (the "Integra Note"), which represents a
contribution of capital by Integra to Assignor, its wholly owned subsidiary.

     C. Assignor intends to secure its obligations under the CNS Note, in
part, by assigning the Integra Note to Assignee as collateral pursuant to
this Agreement.

     D. CNS is willing to accept the CNS Note in payment of a portion of the
purchase price under the Asset Purchase Agreement only on the condition that
the Assignor executes and delivers this collateral assignment of the Integra
Note to Assignee.

     E. CNS intends to liquidate and dissolve promptly after the date of this
Agreement, whereupon CNS intends to distribute the CNS Note and the Integra
Note and its rights under the Asset Purchase Agreement and this Agreement to
George J. Connell as its sole stockholder, and upon such distribution, George
J. Connell shall be the sole Assignee hereunder.

     NOW, THEREFORE, the parties hereto, intending to be legally bound,
hereby agree as follows:

     1. Assignment.

        (a) As security for the repayment of the CNS Note and the performance
and satisfaction of all other obligations of the Assignor under the CNS Note,
Assignor hereby collaterally assigns, transfers and sets over to the Assignee
and grants to the Assignee a security interest in and to all of Assignor's
right, title, and interest in and to the Integra Note and all monies due and
to become due under the Integra Note, and all rights, remedies and benefits
arising thereunder, with full power and right in the Assignee's own name or
in Assignor's name

<PAGE>

to take all such legal or other action as may be necessary to enforce the
provisions of the Integra Note;

        (b) Upon the occurrence and during the continuance of an event of
default under the CNS Note, Assignor irrevocably appoints the Assignee its
attorney, with power of substitution, to sue for, receive, collect,
compromise and adjust, and give releases for the monies due or to become due,
and authorizes and empowers the Assignee to endorse Assignor's name on, and
collect, all checks or other proceeds received by the Assignor under the
Integra Note.

     2. Payments under the Note. Until the occurrence of an event of default
under the CNS Note, all payments under the Integra Note shall be made to
Assignor. Upon the occurrence and during the continuance of an event of
default under the CNS Note, at the Assignee's discretion, all payments under
the Integra Note (whether upon demand or otherwise) shall be made to the
Assignee and shall be applied by the Assignee against the sums due under the
CNS Note, and the Assignee shall be permitted to take all actions to collect
all payments under the Integra Note. In the event Integra shall make any
payments under the Integra Note to Assignor in contravention of this
Agreement, Assignor shall receive and hold such payments in trust for the
benefit of the Assignee and shall immediately pay over such payment to the
Assignee.

     3. Representations and Warranties of Assignor. Assignor represents and
warrants as follows:

        (a) Assignor has not previously assigned, transferred or pledged the
Integra Note and no other person or entity has any right, title or interest
thereto.

        (b) The Integra Note and Integra's remaining obligations thereunder are
in full force and effect and enforceable in accordance with their terms, except
as such enforcement may be limited by bankruptcy, insolvency or other laws of
general application relating to or effecting the enforcement of creditors'
rights and except as enforcement is subject to general equitable principles.

        (c) No default has occurred under the Integra Note. Integra has no
defenses, setoffs or counterclaims to payment under the Integra Note, except
as expressly set forth therein.

        (d) Assignor is the lawful holder of and owner of all rights under the
Integra Note, and has the right and ability to assign the Integra Note and
has the full right and title to the Integra Note free from any lien, security
interest, encumbrance or other right whatsoever.

        (e) Assignor shall perform and fulfill all obligations and conditions to
be performed and fulfilled under the Integra Note, if any, and expressly
acknowledges that no duties thereunder are being imposed upon or delegated to
the Assignee.

<PAGE>

     4. Delivery of Note. Assignor has delivered the Integra Note to the
Assignee concurrently herewith.

     5. Modifications. Assignor shall not consent to any changes or
modifications to the Integra Note, nor waive, excuse, condone or in any
manner release or discharge any covenant or agreement of Integra under the
Integra Note without the Assignee's prior written consent.

     6. Communications. Assignor, promptly upon its receipt thereof, shall
provide the Assignee with copies of all notices and other communications
received by Assignor from or on behalf of Integra and relating in any way to
the Integra Note.

     7. Notices. Any written notices required or permitted by this Agreement
shall be effective if delivered in accordance with paragraph 8 of the CNS
Note.

     8. Miscellaneous.

        (a) This Assignment shall be governed by and construed in accordance
with the laws of the Commonwealth of Pennsylvania.

        (b) This Assignment shall be binding upon Assignor, its successors and
assigns and shall inure to the benefit of the Assignee, its successors and
assigns.

        (c) This Assignment contains the entire agreement of the parties with
respect to the subject matter hereof and no representation, inducement,
promise or agreement between the parties with respect to the subject matter
hereof which is not embodied herein shall be of any force or effect.

        (d) This Assignment may not be modified, amended or otherwise altered,
except by written agreement executed by Assignor and Assignee.

        (e) CNS and Connell acknowledge and agree to the subordination
provisions of the Integra Note.

<PAGE>

     IN WITNESS WHEREOF, Assignor and the Assignee have executed this
Assignment as of the date written above.

                                 Assignor:

                                 CLINICAL NEURO SYSTEMS HOLDINGS LLC

                                 By:  Integra LifeSciences Corporation, its sole
                                      member

                                 By:
                                     -------------------------------------------
                                     Stuart M. Essig, Chief Executive Officer

                                 Assignee:

                                 CLINICAL NEURO SYSTEMS, INC.

                                 By:
                                     -------------------------------------------
                                     George J. Connell, President

                                 -----------------------------------------------
                                 GEORGE J. CONNELL

APPROVED AND AGREED:

INTEGRA LIFESCIENCES
CORPORATION

By:
    ----------------------------
     Stuart M. Essig,
     Chief Executive Officer

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