Document:

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                                                                     Exhibit 4.1

                    CERTIFICATE OF DESIGNATION, PREFERENCES
                                 AND RIGHTS OF
                              SERIES D CONVERTIBLE
                                PREFERRED STOCK
                                       OF
                               ORGANOGENESIS INC.

                        (Pursuant to Section 151 of the
                       Delaware General Corporation Law)

        Organogenesis Inc., a Delaware corporation (the "Corporation"), hereby
                                                         -----------
certifies that the following resolution was duly approved and adopted by the
Board of Directors of the Corporation (the "Board of Directors") at a meeting
                                            ------------------
duly held on March 13, 2002, which resolution remains in full force and effect
on the date hereof:

        RESOLVED, that pursuant to the authority expressly granted to and
vested in the Board of Directors by the provisions of the Restated Certificate
of Incorporation of the Corporation (the "Certificate of Incorporation") and
                                          ----------------------------
its By-Laws (the "Bylaws"), and in accordance with Section 151 of the General
                  ------
Corporation Law of the State of Delaware (the "DGCL"), there is hereby created,
                                               ----
out of the 699,800 shares of Preferred Stock, par value $1.00 per share (the
"Preferred Stock"), of the Corporation remaining authorized, unissued and
 ---------------
undesignated, a series of the Preferred Stock consisting of 120,000 shares,
which series shall have the following powers, designations, preferences and
relative, participating, optional or other rights, and the following
qualifications, limitations and restrictions (in addition to any powers,
designations, preferences and relative, participating, optional or other
rights, and any qualifications, limitations and restrictions, set forth in the
Certificate of Incorporation which are applicable to the Preferred Stock):

         SECTION 1  Designation of Amount.
                    ---------------------

         (a) 120,000 shares of Preferred Stock shall be, and hereby are,
designated the "Series D Convertible Preferred Stock" (the "Series D Preferred
                                                            ------------------
Stock"), par value $1.00 per share.
-----

         (b) Subject to the requirements of the DGCL, the Certificate of
Incorporation and this Certificate of Designation, the number of shares of
Preferred Stock that are designated as Series D Preferred Stock may be
increased or decreased by vote of the Board of Directors; provided, that no
                                                          --------
decrease shall reduce the number of shares of Series D Preferred Stock to a
number less than the number of such shares then outstanding plus the number of
                                                            ----
such shares reserved for issuance upon the exercise of outstanding options,
rights or warrants or upon the conversion of any other outstanding securities
issued by the Corporation that are convertible into or exercisable for Series D
Preferred Stock. Any shares of Series D Preferred Stock converted, redeemed,
purchased or otherwise acquired by the Corporation in any manner whatsoever
shall, automatically and without further action, be retired and canceled
promptly after the acquisition thereof, and shall become authorized but
unissued shares of Preferred Stock when the Corporation shall take such action
as may be necessary to reduce the number of authorized shares of the Series D
Preferred Stock and may be reissued as part of a new series of any class or
series of Preferred Stock in accordance with the Certificate of Incorporation
and this Certificate.

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        SECTION 2   Certain Definitions.
                    -------------------

        Unless the context otherwise requires, the terms defined in this
Section 2 shall have, for all purposes of this resolution, the meanings
specified (with terms defined in the singular having comparable meanings when
used in the plural).

        "Common Stock" shall mean the common stock, par value $0.01 per share,
         ------------
of the Corporation.

        "Conversion Date" shall have the meaning ascribed to such term in
         ---------------
Section 6(e).

        "Conversion Price" shall mean $1.45, subject to adjustment from time to
         ----------------
time in accordance with Section 6(d).

        "DGCL" shall have the meaning set forth in the preamble to this
         ----
Certificate of Designation.

        "Exchange Act" shall mean the Securities Exchange Act of 1934, as
         ------------
amended, and the rules and regulations promulgated thereunder.

        "Excluded Securities" shall mean:
         -------------------

                (i)     shares of Common Stock issued (or issuable upon exercise
of rights, options or warrants outstanding from time to time) or granted to
officers, directors or employees of, or consultants to, the Corporation
pursuant to a stock grant, stock option plan, employee stock purchase plan,
restricted stock plan or other similar plan or agreement or otherwise, in each
case as approved by the Board of Directors;

                (ii)    shares of Common Stock issued (or issuable upon exercise
of rights, options or warrants outstanding from time to time) or granted to
persons or entities with whom the Corporation has business relationships,
including under equipment leasing arrangements, bank or other institutional
loans, strategic partnerships, acquisitions of companies or product lines or
other arrangements or transactions wherein the principal purpose of the
issuance of such shares (or rights, warrants or options) is for non-equity
financing purposes; provided, that such arrangements are approved by the
                    --------  ----
majority vote or written consent of the Board of Directors and any shares of
Common Stock issued or issuable in such transactions (including as a result of
the exercise or conversion of any rights, options or warrants issued in
connection therewith) do not exceed in the aggregate, when combined with all
other securities then outstanding that were issued in compliance with this
clause (ii) of the definition of "Excluded Securities", 3% of the outstanding
shares of Common Stock on a fully diluted basis;

                (iii)   shares of Common Stock issued or issuable as a result of
any stock split, combination, dividend, distribution, reclassification, exchange
or substitution for which an equitable adjustment is provided for in Section
6(d);

                (iv)    shares of Common Stock issuable upon conversion of notes
or the exercise of rights, options, warrants or other rights (including in
connection with the put option that the Corporation may exercise to raise an
additional $10 million from Novartis) to acquire securities of the Corporation
outstanding as of the Initial Issue Date; or

                (v)     shares of Common Stock issued by the Corporation in
payment of interest on convertible notes outstanding as of the date hereof.

                                     -2-

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        "Fair Market Value " shall mean, with respect to any listed security,
         -----------------
its Market Price, and with respect to any property or assets other than cash or
listed securities, the fair value thereof determined in good faith by the Board
of Directors.

        "Initial Issue Date" shall mean the date that shares of Series D
         ------------------
Preferred Stock are first issued by the Corporation.

        "Market Price" means, as to any class of listed securities, the average
         ------------
of the closing prices of such security's sales on all United States securities
exchanges on which such security may at the time be listed, or, if there have
been no sales on any such exchange on any day, the average of the highest bid
and lowest asked prices on all such exchanges at the end of such day, or, if on
any day such security is not so listed, the average of the representative bid
and asked prices quoted by the Nasdaq Stock Market, Inc. ("Nasdaq") as of 4:00
                                                           ------
P.M., New York time, on such day, or, if on any day such security is not quoted
by the Nasdaq, the average of the highest bid and lowest asked prices on such
day in the domestic over-the-counter market as reported by the OTC Bulletin
Board, or any similar or successor organization, in each such case averaged over
a period of 10 trading days ending immediately prior to the day as of which
"Market Price" is being determined.

        "Original Purchase Price" shall mean the per share purchase price for a
         -----------------------
share of Series D Preferred Stock of $65.00, or such other price set forth in
the purchase agreements pursuant to which Series D Preferred Stock is sold.

        "person" shall mean any individual, partnership, company, limited
         ------
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization, government or agency or political subdivision
thereof, or other entity.

        "Preferred Stock" shall have the meaning set forth in the preamble to
         ---------------
this Certificate of Designation.

        "Requisite Holders" shall mean the holders of at least sixty percent
         -----------------
(60%) of the then outstanding shares of Series D Preferred Stock.

        "Securities Act" shall mean the Securities Act of 1933, as amended, and
         --------------
the rules and regulations promulgated thereunder.

        "Series A Preferred Stock" shall mean the Series A Convertible Preferred
         ------------------------
Stock, par value $1.00 per share, of the Corporation.

        "Series B Preferred Stock" shall mean the Series B Junior Participating
         ------------------------
Preferred Stock, par value $1.00 per share, of the Corporation.

        "Series C Preferred Stock" shall mean the Series C Convertible Preferred
         ------------------------
Stock, par value $1.00 per share, of the Corporation.

        "Series D Preferred Stock" shall have the meaning set forth in Section
         ------------------------
1.

        "Series D Recapitalization Event" shall mean any stock dividend, stock
         -------------------------------
split, combination, reorganization, recapitalization, reclassification, or other
similar event involving a change in the capital structure of the Series D
Preferred Stock.

        "subsidiary" means, with respect to any person, (a) a company a majority
         ----------
of whose capital stock with voting power, under ordinary circumstances, to elect
directors is at the time, directly or indirectly, owned by such person, by a
subsidiary of such person, or by such person

                                     -3-

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and one or more subsidiaries of such person, (b) a partnership in which such
person or a subsidiary of such person is, at the date of determination, a
general partner of such partnership, or (c) any other person (other than a
company) in which such person, a subsidiary of such person or such person and
one or more subsidiaries of such person, directly or indirectly, at the date of
determination thereof, has (i) at least a majority ownership interest, (ii) the
power to elect or direct the election of the directors or other governing body
of such person, or (iii) the power to direct or cause the direction of the
affairs or management of such person. For purposes of this definition, a person
is deemed to own any capital stock or other ownership interest if such person
has the right to acquire such capital stock or other ownership interest,
whether through the exercise of any purchase option, conversion privilege or
similar right.

        "Subsidiary" shall mean a subsidiary of the Corporation.
         ----------

        SECTION 3   Voting Rights.
                    -------------

        (a) General. Except as otherwise provided by the DGCL and in addition to
            -------
any voting rights provided by the DGCL or other applicable law, the holders of
Series D Preferred Stock shall be entitled to vote (or render written consents)
together with the holders of the Common Stock and any other class or series of
capital stock of the Corporation entitled to vote together with the holders of
the Common Stock as a single class on all matters submitted for a vote of (or
written consents in lieu of a vote as permitted by the DGCL, the Certificate of
Incorporation and the Bylaws) holders of Common Stock; and shall have such other
voting rights as are specified in the Certificate of Incorporation and this
Certificate of Designation. When voting together with the holders of Common
Stock, each share of Series D Preferred Stock shall entitle the holder thereof
to cast one vote for each vote that such holder would be entitled to cast had
such holder converted its Series D Preferred Stock into shares of Common Stock
as of the record date for determining the stockholders of the Corporation
eligible to vote on any such matter or, if no such record date is established,
at the date such vote is taken or any written consent of stockholders is
solicited. The holders of Series D Preferred Stock shall be entitled to receive
notice of any stockholders' meeting in accordance with the Certificate of
Incorporation and Bylaws of the Corporation.

        (b) Waivers. Except to the extent otherwise provided in this Certificate
            -------
of Designation or required by the DGCL, the Requisite Holders may, via
affirmative vote or written consent in lieu thereof, waive any rights of the
holders of the Series D Preferred Stock set forth in this Certificate of
Designation.

        SECTION 4   Dividends.
                    ---------

        (a) Dividend Amount.
            ---------------

        Non-Cumulative Dividends. The holders of the outstanding shares of
        ------------------------
Series D Preferred Stock shall be entitled to receive, out of any funds legally
available therefor, quarterly dividends, at the annual rate of seven percent
(7%) of the Original Purchase Price of each such share of Series D Preferred
Stock. Dividends on shares of Series D Preferred Stock shall be payable if, as
and when declared by the Board of Directors. Such dividends shall not be
cumulative, and, therefore, if not declared in any quarter, the right to such
dividend shall terminate and shall not carry forward to the next quarter.

        (b) Equitable Adjustments. All numbers relating to the calculation of
            ---------------------
dividends shall be subject to an equitable adjustment in the event of any
Series D Recapitalization Event.

                                     -4-

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        SECTION 5   Liquidation Preference.
                    ----------------------

        (a) Liquidation Preference of Series D Preferred Stock. In the event of
            --------------------------------------------------
any liquidation, dissolution, or winding up of the Corporation, whether
voluntary or involuntary, or in the event of its insolvency, the holders of
Series D Preferred Stock shall be entitled to have set apart for them, or to be
paid, out of the assets of the Corporation available for distribution to
stockholders (whether such assets are capital, surplus or earnings) after
provision for payment of all debts and liabilities of the Corporation in
accordance with the DGCL, before any distribution or payment is made with
respect to any shares of the Common Stock, the Series A Preferred Stock, the
Series B Preferred Stock, the Series C Preferred Stock or any other class or
series of capital stock of the Corporation designated to be junior to the Series
D Preferred Stock and subject to the liquidation rights and preferences of any
class or series of Preferred Stock designated to be senior to, or on a parity
with, the Series D Preferred Stock with respect to liquidation preferences, a
per share amount equal to the Original Purchase Price.

        (b) Insufficient Assets. If, upon any liquidation, dissolution, or
            -------------------
winding up of the Corporation, whether voluntary or involuntary, the assets
legally available for distribution among the holders of the Series D Preferred
Stock shall be insufficient to permit payment to such holders of the full
preferential amount as provided for in Section 5(a) above, then such holders
shall share ratably in any distribution of available assets according to the
respective amounts which would otherwise be payable with respect to the shares
of Series D Preferred Stock held by them upon such liquidating distribution if
all amounts payable on or with respect to such shares were paid in full, based
upon the aggregate liquidation value payable upon all shares of Series D
Preferred Stock then outstanding.

        (c) No Participation with Common Stock. After such payment shall have
            ----------------------------------
been made in full to the holders of the Series D Preferred Stock, or funds
necessary for such payment shall have been set aside by the Corporation in
trust for the account of holders of the Series D Preferred Stock so as to be
available for such payment, the remaining assets available for distribution
shall be distributed ratably among the holders of the Common Stock and any class
or series of capital stock designated junior to the Series D Preferred Stock or
entitled to participate with the Common Stock in right of payment upon any
liquidation, dissolution or winding up of the Corporation.

        (d) Cash-Out Election.
            -----------------

                (i)     The Requisite Holders may elect to treat any of the
following transactions as a liquidation, dissolution or winding up of the
Corporation for the purposes of this Section 5: (1) a consolidation or merger of
the Corporation with or into any other corporation or corporations; (2) a sale
of all or substantially all of the assets of the Corporation; (3) the issuance
and/or sale by the Corporation in a single or integrated transaction of shares
of Common Stock (or securities convertible into shares of Common Stock)
constituting a majority of the shares of Common Stock outstanding immediately
following such issuance (treating all securities convertible into shares of
Common Stock as having been fully converted and all options and other rights to
acquire shares of Common Stock or securities convertible into shares of Common
Stock as having been fully exercised); and (4) any other form of acquisition or
business combination where the Corporation is the target of such acquisition and
where a change in control occurs such that the person or entity seeking to
acquire the Corporation has the power to

                                     -5-

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elect a majority of the Board of Directors as a result of the transaction (each
such event an "Acquisition").
               -----------

                (ii)    In the event of an Acquisition and election pursuant to
Section 5(d)(1), the proceeds or other consideration to be received by the
stockholders of the Corporation shall be reallocated among the holders of the
capital stock of the Corporation to fully give import to the meaning, intent and
purposes of this Section 5(d). After such payment shall have been made in full
to the holders of the Series D Preferred Stock, or funds necessary for such
payments shall have been set aside by the Corporation in trust for the account
of holders of the Series D Preferred Stock so as to be available for such
payment, the remaining assets available for distribution shall be distributed
ratably among the holders of the Common Stock and any class or series of capital
stock designated to be junior to the Series D Preferred Stock (if any).

                (iii)   The provisions of this Section 5(d) shall not apply to
any reorganization, merger or consolidation involving (1) only a change in the
state of incorporation of the Corporation, (2) a merger of the Corporation with
or into a wholly-owned subsidiary of the Corporation that is incorporated in
the United State of America, or (3) an acquisition or merger, reorganization or
consolidation, of which the Corporation is substantively the surviving
corporation and operates as a going concern, where the Corporation is
purchasing the assets or stock of another entity, and where there is a
reasonable continuity of ownership such that the holders of the Corporation's
capital stock outstanding prior to any proposed business combination or
acquisition continue to have the right or power to elect a majority of the
members of the Corporation's Board of Directors following the consummation of
any such business combination or acquisition.

        (e) Distributions Other than Cash. Whenever the distribution provided
            -----------------------------
for in this Section 5 shall be payable in property other than cash, the value of
such distribution shall be the Fair Market Value thereof. All distributions
(including distributions other than cash) made hereunder shall be made pro rata
                                                                       --- ----
to the holders of Series D Preferred Stock.

        (f) Equitable Adjustments. The amounts to be paid or set aside for
            ---------------------
payment as provided above in this Section 5 shall be proportionately increased
or decreased in inverse relation to the change in the number of outstanding
shares resulting from any Series D Recapitalization Event.

        SECTION 6   Conversion Rights.
                    -----------------

        (a) General. Subject to and upon compliance with the provisions of this
            -------
Section 6, each holder of shares of Series D Preferred Stock shall be entitled,
at its option, at any time, to convert all or any such shares of Series D
Preferred Stock into the number of fully paid and nonassessable shares of Common
Stock equal to the number obtained by dividing (i) the Original Purchase Price
of such Series D Preferred Stock, plus dividends declared but unpaid thereon, by
(ii) the Conversion Price in effect at the close of business on the Conversion
Date (determined as provided in this Section 6).

        (b) Automatic Conversion. All shares of Series D Preferred Stock shall
            --------------------
be automatically converted into the number of shares of Common Stock into which
such shares of Series D Preferred Stock are then convertible pursuant to Section
6(a) without any further action by the holders of such shares and whether or not
the certificates representing such shares are surrendered to the Corporation or
its transfer agent (i) immediately prior to the closing of an underwritten firm
commitment public offering pursuant to an effective registration statement

                                     -6-

<PAGE>

under the Securities Act in which the proceeds to the Corporation, before
expenses and underwriting discounts, are not less than $15,000,000 at a price
to the public of not less than $4.00 per share, (ii) on the date on which less
than ten percent (10%) of the shares of Series D Preferred Stock issued by the
Company are outstanding or (iii) if the Requisite Holders do not elect to treat
an Acquisition as a liquidation, dissolution or winding up of the Corporation
pursuant to Section 5(d), then all shares of Series D Preferred Stock shall
automatically convert, immediately prior to the closing of the Acquisition,
into such number of shares of Common Stock into which such shares of Series D
Preferred Stock are then convertible pursuant to Section 6(a).

        (c) Fractions of Shares. No fractional shares of Common Stock shall be
            -------------------
issued upon conversion of shares of Series D Preferred Stock. If more than one
share of Series D Preferred Stock shall be surrendered for conversion at one
time by the same holder, the number of full shares of Common Stock to be issued
shall be computed on the basis of the aggregate number of shares of Series D
Preferred Stock so surrendered. Instead of any fractional shares of Common Stock
which would otherwise be issuable upon conversion of any shares of Series D
Preferred Stock, the Corporation shall pay a cash adjustment in respect of such
fractional share in an amount equal to the product of such fraction multiplied
by the Fair Market Value of one share of Common Stock on the Conversion Date.

        (d) Adjustments to Conversion Price. The Conversion Price shall also be
            -------------------------------
subject to adjustment from time to time as follows:

                (i)(A) Weighted Average Anti-Dilution. If the Corporation shall,
                       ------------------------------
at any time or from time to time after the Initial Issue Date, issue (or be
deemed to have issued in accordance with Section 6(d)(i)(B) below) any shares of
Common Stock (other than Excluded Securities), without consideration or for
consideration per share less than the Conversion Price in effect immediately
prior to such issuance, then the Conversion Price shall forthwith be lowered
(but in no event increased) to a price equal to the amount determined by
multiplying such Conversion Price by a fraction:

                        (1) the numerator of which shall be (x) the number of
                shares of Common Stock outstanding immediately prior to the
                issuance of such additional shares of Common Stock (calculated
                on a fully-diluted basis assuming the exercise or conversion
                of all Common Stock equivalents) plus (y) the number of shares
                                                 ----
                of Common Stock which the net aggregate consideration, if any,
                received by the Corporation for the total number of such
                additional shares of Common Stock so issued would purchase at
                the Conversion Price in effect immediately prior to such
                issuance, and

                        (2) the denominator of which shall be (w) the number of
                shares of Common Stock outstanding immediately prior to the
                issuance of such additional shares of Common Stock (calculated
                on a fully-diluted basis assuming the exercise or conversion of
                all Common Stock equivalents) (z) the number of such additional
                shares of Common Stock so issued.

Any such adjustment shall become effective immediately after the opening of
business on the day following the issuance of such shares of Common Stock.

                                     -7-

<PAGE>

        (B)     For the purposes of any adjustment of a Conversion Price
                pursuant to this Section 6(d), the following provisions shall
                be applicable:

                        (1)     In the case of the issuance of Common Stock for
                cash in a public offering or private placement, the
                consideration shall be deemed to be the amount of cash paid
                therefor after deducting therefrom any discounts, commissions
                or placement fees payable by the Corporation to any
                underwriter or placement agent in connection with the issuance
                and sale thereof.

                        (2)     In the case of the issuance of Common Stock for
                a consideration in whole or in part other than cash, the
                consideration other than cash shall be deemed to be the Fair
                Market Value thereof.

                        (3)     In the case of the issuance of options to
                purchase or rights to subscribe for Common Stock, securities
                by their terms convertible into or exchangeable for Common
                Stock, or options to purchase or rights to subscribe for such
                convertible or exchangeable securities, except for options to
                acquire Excluded Securities:

                                (a)     the aggregate maximum number of shares
                        of Common Stock deliverable upon exercise of such
                        options to purchase or rights to subscribe for Common
                        Stock shall be deemed to have been issued at the time
                        such options or rights were issued and for a
                        consideration equal to the consideration (determined
                        in the manner provided in subparagraphs (1) and (2)
                        above), if any, received by the Corporation upon the
                        issuance of such options or rights plus the minimum
                        purchase price provided in such options or rights for
                        the Common Stock covered thereby;

                                (b)     the aggregate maximum number of shares
                        of Common Stock deliverable upon conversion of or in
                        exchange of any such convertible or exchangeable
                        securities or upon the exercise of options to purchase
                        or rights to subscribe for such convertible or
                        exchangeable securities and subsequent conversion or
                        exchange thereof shall be deemed to have been issued
                        at the time such securities, options, or rights were
                        issued and for a consideration equal to the
                        consideration received by the Corporation for any such
                        securities and related options or rights (excluding
                        any cash received on account of accrued interest or
                        accrued dividends), plus the minimum additional
                        consideration, if any, to be received by the
                        Corporation upon the conversion or exchange of such
                        securities or the exercise of any related options or
                        rights (the consideration in each case to be
                        determined in the manner provided in subparagraphs (1)
                        and (2) above);

                                (c)     on any change in the number of shares of
                        Common Stock deliverable upon exercise of any such
                        options or rights or conversions of or exchanges for
                        such securities or exercise price therefor, other than
                        a change resulting from the anti-dilution provisions
                        thereof, the applicable Conversion Price shall
                        forthwith be readjusted to such Conversion Price as
                        would have been obtained had the adjustment made upon
                        the issuance of

                                     -8-

<PAGE>

                        such options, rights or securities not converted prior
                        to such change or options or rights related to such
                        securities not converted prior to such change been
                        made upon the basis of such change;

                                (d)     upon the expiration of any such options
                        or the termination of any rights, convertible
                        securities or exchangeable securities, the applicable
                        Conversion Price shall forthwith be readjusted to such
                        Conversion Price as would have been in effect at the
                        time of such expiration or termination had such
                        options, rights, convertible securities or
                        exchangeable securities, to the extent outstanding
                        immediately prior to such expiration or termination,
                        never been issued; and

                                (e)     no further adjustment of the Conversion
                        Price adjusted upon the issuance of any such options,
                        rights, convertible securities or exchangeable
                        securities shall be made as a result of the actual
                        issuance of Common Stock on the exercise of any such
                        rights or options or any conversion or exchange of any
                        such securities.

                (ii) Upon Stock Dividends, Subdivisions or Splits. If, at any
                     --------------------------------------------
time after the date hereof, the number of shares of Common Stock outstanding is
increased by a stock dividend payable in shares of Common Stock or by a
subdivision or split-up of shares of Common Stock, then, following the record
date for the determination of holders of Common Stock entitled to receive such
stock dividend, or to be affected by such subdivision or split-up, the
Conversion Price shall be appropriately decreased so that the number of shares
of Common Stock issuable on conversion of Series D Preferred Stock shall be
increased in proportion to such increase in outstanding shares.

                (iii) Upon Combinations. If, at any time after the date hereof,
                      -----------------
the number of shares of Common Stock outstanding is decreased by a combination
of the outstanding shares of Common Stock into a smaller number of shares of
Common Stock, then, following the record date to determine shares affected by
such combination, the Conversion Price shall be appropriately increased so that
the number of shares of Common Stock issuable on conversion of each share of
Series D Preferred Stock shall be decreased in proportion to such decrease in
outstanding shares.

                (iv) Capital Reorganization or Reclassification. If the Common
                     ------------------------------------------
Stock issuable upon the conversion of the Series D Preferred Stock shall be
changed into the same or different number of shares of any class or classes of
stock, whether by capital reorganization, reclassification or otherwise (other
than a subdivision or combination or shares of stock dividend provided for
elsewhere in this Section 6(d), or the sale of all or substantially all of the
Corporation's properties and assets to any other person), then and in each such
event the holder of each share of Series D Preferred Stock shall have the right
thereafter to convert such share into the kind and amount of shares of stock and
other securities and property receivable upon such reorganization,
reclassification or other change by holders of the number of shares of Common
Stock into which such shares of Series D Preferred Stock might have been
converted, as the case may be, immediately prior to such reorganization,
reclassification or change, all subject to further adjustment as provided
herein.

                                     -9-

<PAGE>

                (v) Deferral in Certain Circumstances. In any case in which
                    ---------------------------------
the provisions of this Section 6(d) shall require that an adjustment shall
become effective immediately after a record date of an event, the Corporation
may defer until the occurrence of such event (1) issuing to the holder of any
Series D Preferred Stock converted after such record date and before the
occurrence of such event the shares of capital stock issuable upon such
conversion by reason of the adjustment required by such event and issuing to
such holder only the shares of capital stock issuable upon such conversion
before giving effect to such adjustments, and (2) paying to such holder any
amount in cash in lieu of a fractional share of capital stock pursuant to
Section 6(c) above; provided, however, that the Corporation shall deliver to
                    --------  -------
such holder an appropriate instrument or due bills evidencing such holder's
right to receive such additional shares and such cash.

                (e) Exercise of Conversion Privilege. In order to exercise the
                    --------------------------------
conversion privilege, the holder of any share of Series D Preferred Stock shall
surrender the certificate evidencing such share of Series D Preferred Stock,
duly endorsed or assigned to the Corporation in blank, at any office or agency
of the Corporation maintained for such purpose, accompanied by written notice to
the Corporation at such office or agency that the holder elects to convert such
Series D Preferred Stock or, if less than the entire amount thereof is to be
converted, the portion thereof to be converted. Series D Preferred Stock shall
be deemed to have been converted immediately prior to the close of business on
the date (the "Conversion Date") of the surrender of such shares of Series D
               ----------------
Preferred Stock for conversion in accordance with the foregoing provisions, and
at such time the rights of the holder of such shares of Series D Preferred Stock
as a holder shall cease, and the person or persons entitled to receive the
Common Stock issuable upon conversion shall be treated for all purposes as the
record holder or holders of such Common Stock as and after such time. As
promptly as practicable on or after the Conversion Date, the Corporation shall
issue and shall deliver at any office or agency of the Corporation maintained
for the surrender of Series D Preferred Stock a certificate or certificates for
the number of full shares of Common Stock issuable upon conversion, together
with payment in lieu of any fraction of a share, as provided in Section 6(c). In
the case of any certificate evidencing shares of Series D Preferred Stock that
is converted in part only, upon such conversion the Corporation shall also
execute and deliver a new certificate evidencing the number of shares of Series
D Preferred Stock that are not converted.

                (f) Notice of Adjustment of Conversion Price. Whenever the
                    ----------------------------------------
provisions of Section 6(d) require that the Conversion Price be adjusted as
herein provided, the Corporation shall compute the adjusted Conversion Price in
accordance with Section 6(d) and shall prepare a certificate signed by the
Corporation's chief executive officer or chief financial officer setting forth
the adjusted Conversion Price and showing in reasonable detail the facts upon
which such adjustment is based, and such certificate shall forthwith be filed at
each office or agency maintained for such purpose for conversion of shares of
Series D Preferred Stock and mailed by the Corporation at its expense to all
holders of Series D Preferred Stock at their last addresses as they shall appear
in the stock register.

                (g) Corporation to Reserve Common Stock. The Corporation shall
                    -----------------------------------
at all times reserve and keep available, free from preemptive rights, out of the
authorized but unissued Common Stock or out of the Common Stock held in
treasury, for the purpose of effecting the conversion of Series D Preferred
Stock, the full number of shares of Common Stock then issuable upon the
conversion of all outstanding shares of Series D Preferred Stock. Before taking
any action that

                                     -10-

<PAGE>

would cause an adjustment reducing the conversion price below the then par value
(if any) of the shares of Common Stock deliverable upon conversion of the Series
D Preferred Stock, the Corporation will take any corporate action that, in the
opinion of its counsel, is necessary in order that the Corporation may validly
and legally issue fully paid and non-assessable shares of Common Stock at such
adjusted conversion price.

                (h) Taxes on Conversions. The Corporation will pay any and all
                    --------------------
original issuance, transfer, stamp and other similar taxes that may be payable
in respect of the issue or delivery of shares of Common Stock on conversion of
Series D Preferred Stock pursuant hereto. The Corporation shall not, however, be
required to pay any tax which may be payable in respect of any transfer involved
in the issue and delivery of shares of Common Stock in a name other than that of
the holder of the share(s) of Series D Preferred Stock to be converted, and no
such issue or delivery shall be made unless and until the person requesting such
issue has paid to the Corporation the amount of any such tax, or has established
to the satisfaction of the Corporation that such tax has been paid.

                (i) Notwithstanding anything to the contrary in this Section 6,
the aggregate shares of Common Stock issuable upon conversion of the Series D
Preferred Stock shall not exceed 7,377,905, (subject to appropriate adjustment
for any stock dividend, stock split, combination or other similar
recapitalization affecting such shares).

        SECTION 7   Redemption of Series D Preferred Stock
                    --------------------------------------

        (a) Optional Redemption by the Corporation. At any time after March 13,
            --------------------------------------
2004 and provided that the Common Stock of the Corporation trades at a price
that is equal to or greater than two hundred percent (200%) of the Conversion
Price for a period of twenty (20) consecutive trading days, the Corporation may
elect to redeem all or any portion of the then outstanding shares of Series D
Preferred Stock at a price per share equal to the Redemption Price set forth in
Section 7(b) below by giving written notice to the holders of Series D Preferred
Stock of such election (the "Redemption Notice") whereupon the Corporation shall
                             -----------------
be obligated to repurchase and the holders of Series D Preferred Stock shall be
obligated to sell such shares of Series D Preferred Stock on such date (the
"Redemption Date") as shall be specified by the Corporation in the Redemption
 ---------------
Notice; provided, that the Redemption Date shall not be earlier than ten (10)
        --------  ----
days nor later than thirty (30) days after the date on which the Redemption
Notice is delivered to the holders of Series D Preferred Stock. Any holder of
Series D Preferred Stock who receives a Redemption Notice may, before the
Redemption Date, convert, in accordance with Section 6, any or all shares of
Series D Preferred Stock held by that person.

        (b) Redemption Price and Payment. The Series D Preferred Stock to be
            ----------------------------
redeemed on the Redemption Date shall be redeemed, if not previously converted
pursuant to Section 6 hereof, by paying for each share an amount in cash equal
to the Original Purchase Price per share with respect to such share, plus any
dividends declared but unpaid thereon; such amount is referred to as the
"Redemption Price". The Redemption Price and other amounts set forth in this
 ----------------
Section 7 shall be subject to an equitable adjustment in the event of any Series
D Recapitalization Event.

        (c) Redemption Closing. The closing of the Corporation's redemption of
            ------------------
the Series D Preferred Stock pursuant to this Section 7 shall take place at
11:00 a.m. Eastern Standard Time on the Redemption Date at the Corporation's
principal executive office or other mutually agreed upon location where the
closing will occur. At the closing, the Corporation shall pay to each holder of
Series D Preferred Stock from whom shares of Series D Preferred Stock are being

                                     -11-

<PAGE>

redeemed an amount equal to the aggregate Redemption Price for all such shares
against receipt from such holder of the certificate or certificates, duly
endorsed or assigned to the Corporation in blank, representing the shares of
Series D Preferred Stock being redeemed. All such payments shall be made by wire
transfer of immediately available funds or, if any such holder shall not have
specified wire transfer instructions to the Corporation prior to the closing, by
certified or official bank check payable to the order of the holder. In the case
of any certificate evidencing shares of Series D Preferred Stock that is
redeemed in part only, upon such redemption the Corporation shall also execute
and deliver a new certificate evidencing the number of shares of Series D
Preferred Stock that are not redeemed.

        (d) Insufficient Funds. If the Corporation shall not be permitted, or
            ------------------
shall not have funds legally available in the amount necessary, to redeem all
shares of Series D Preferred Stock to be redeemed on the Redemption Date, then
the Series D Preferred Stock shall be redeemed by the Corporation on such
Redemption Date to the maximum extent the Corporation is permitted and has funds
legally available on a pro rata basis, in accordance with the number of shares
                       --- ----
to be redeemed from each such holder of Series D Preferred Stock.

        (e) Effect of Redemption. From and after the close of business on the
            --------------------
Redemption Date, unless there shall have been a default in the payment of the
Redemption Price, all rights (except the right to receive the Redemption Price)
of the holders of Series D Preferred Stock with respect to the shares of Series
D Preferred Stock to be redeemed on such date shall cease and terminate, and
such shares shall not thereafter be transferred on the books of the Corporation
or be deemed to be outstanding for any purpose whatsoever whether or not the
certificates representing such shares have been received by the Corporation;
provided, however, that, notwithstanding anything contained herein to the
--------  -------
contrary, (A) if the Corporation defaults in the payment of the Redemption
Price, the rights of such holders with respect to such shares of Series D
Preferred Stock shall continue until the Corporation cures such default, and (B)
without limiting any other rights of such holders, upon the occurrence of a
subsequent liquidation, with respect to the shares of Series D Preferred Stock
in respect of which the payment of the Redemption Price has not occurred, such
holders shall be accorded the Liquidation rights set forth in Section 5 hereof
in respect of such remaining shares, as if no prior redemption request had been
made. The shares of Series D Preferred Stock not redeemed shall remain
outstanding and entitled to all rights and preferences provided herein.

        (f) Miscellaneous.
            -------------

                (i)     Except as otherwise provided herein, the number of
shares of Series D Preferred Stock to be redeemed from each holder of Series D
Preferred Stock in redemptions hereunder shall be the number of such shares as
is equal to the total number of such shares to be redeemed multiplied by a
fraction, the numerator of which shall be the total number of such shares then
held by such holder and the denominator of which shall be the total number of
such shares held by all such holders.

                (ii)    Neither the Corporation nor any Subsidiary shall offer
to purchase, redeem or acquire any shares of Series D Preferred Stock other
than pursuant to the terms of this Certificate of Designation or pursuant to a
purchase offer made to all holders of Series D Preferred Stock pro rata based
                                                               --- ----
upon the number of such shares owned by each such holder.

                                     -12-

<PAGE>

        IN WITNESS WHEREOF, the Corporation has caused this Certificate of
Designation, Preferences and Rights to be signed by Michael L. Sabolinski, M.D.,
its President and Chief Executive Officer, and attested by John J. Arcari, its
Secretary, this 20th day of March, 2002.

                                 By: /s/ Michael L. Sabolinski
                                    -------------------------------------
                                        Name: Michael L. Sabolinski, M.D.
                                        Title: President
Attested:

By: /s/ John J. Arcari
   ---------------------------
   John J. Arcari, Secretary

                                     -13-<PAGE>

                                                                    Exhibit 10.1
                        Form of Stock Purchase Agreement
                         INSTRUCTION SHEET FOR INVESTOR
    (to be read in conjunction with the entire Stock Purchase Agreement and
                              Investor Questionnaire)

A.       Complete the following items in the Stock Purchase Agreement and in
the Investor Questionnaire:

                  1.       Provide the information regarding the Investor
         requested on the signature pages (page 2 of the Stock Purchase
         Agreement and pages 1-3 of the Investor Questionnaire). Please submit
         a separate Stock Purchase Agreement and Investor Questionnaire for
         each individual fund/entity that will hold the Shares. The Stock
         Purchase Agreement and the Investor Questionnaire must be executed by
         an individual authorized to bind the Investor.

                  2.       Return the signed Stock Purchase Agreement and
         Investor Questionnaire to:

                            Organogenesis Inc.
                            150 Dan Road
                            Canton, MA 02021
                            Attn: John Arcari
                            Phone:  (781) 575-0775
                            Fax:  (781) 575-1570

                     and fax copies to:

                            Needham & Co., Inc.
                            445 Park Avenue
                            New York, NY 10022
                            Attn:  Charles Drakos
                            Phone:  (212 ) 371-8300
                            Fax:  ( 212) 751-1450

                            and

                            Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.
                            One Financial Center
                            Boston, MA 02111
                            Attn:  Neil H. Aronson, Esq.
                            Attn:  David Shamberger, Esq.
                            Phone:  (617) 542-6000
                            Fax:  (617) 542-2241

         An executed original Stock Purchase Agreement and Investor
         Questionnaire or a fax thereof must be received by 2:00 p.m. Eastern
         Time on a date to be determined and distributed to the Investor at a
         later date.

B.       Wire funds for the purchase of Preferred Shares and the Additional
Shares Right, and/or Common Shares and Common Stock Warrants to Mintz, Levin,
Cohn, Ferris, Glovsky and Popeo, P.C. IOLTA Account, Bank: Fleet Bank, ABA#:
011000390, Account Number: 534-66888, Client/Matter #: 07508-502. The funds
will be held in escrow until the placement agent's counsel advises Mintz Levin
that it has received copies of all documents and signature pages to be
delivered at Closing.

C.       To resell the Preferred Conversion Shares, Common Shares or Warrant
Common Stock Shares, after the Registration Statement covering the Conversion
Shares, Common Shares and Warrant Common Stock Shares is effective:

                  1.       Provided that a Suspension of the Registration
         Statement pursuant to Section 7.2(c) of the Stock Purchase Agreement
         is not then in effect pursuant to the terms of the Stock Purchase
         Agreement, the Investor may sell Preferred Conversion Shares, Common
         Shares or Warrant Common Stock Shares, under the Registration
         Statement, subject to the notification provisions in the Stock
         Purchase Agreement, provided that it arranges for delivery of a
         current Prospectus to the transferee. Upon receipt of a request

<PAGE>

         therefor, the Company has agreed to provide an adequate number of
         current Prospectuses to each investor and to supply copies to any
         other parties requiring such Prospectuses.

                  2.       The Investor must also deliver to the Company's
         transfer agent, with a copy to the Company, a Certificate of
         Subsequent Sale in the form attached as Exhibit A to the Stock
                                                 ---------
         Purchase Agreement, so that the Preferred Shares, Common Shares
         and/or Warrant Common Stock Shares may be properly transferred.

                  3.       The Investor will also be permitted to sell the
         relevant shares pursuant to Rule 144 or pursuant to any other
         exemption from registration available under the Securities Act in
         accordance with the terms of this Agreement.

D.       To resell the Right Conversion Shares after the Additional Shares
Registration Statement covering the Right Conversion Shares is effective:

                  1.       Provided that a Suspension of the Additional Shares
         Registration Statement pursuant to Section 7.2(c) of the Stock Purchase
         Agreement is not then in effect pursuant to the terms of the Stock
         Purchase Agreement, the Investor may sell Right Conversion Shares under
         the Additional Shares Registration Statement, subject to the
         notification provisions in the Stock Purchase Agreement, provided that
         it arranges for delivery of a current Prospectus to the transferee.
         Upon receipt of a request therefor, the Company has agreed to provide
         an adequate number of current Prospectuses to each investor and to
         supply copies to any other parties requiring such Prospectuses.

                  2.       The Investor must also deliver to the Company's
         transfer agent, with a copy to the Company, a Certificate of
         Subsequent Sale in the form attached as Exhibit A to the Stock
                                                 ---------
         Purchase Agreement, so that the Right Preferred Shares or Right
         Conversion Shares may be properly transferred.

                                      2

<PAGE>

                            STOCK PURCHASE AGREEMENT

Organogenesis Inc.
150 Dan Road
Canton, Massachusetts 02021

Ladies & Gentlemen:

         The undersigned, ________________________________(the "Investor"),
hereby confirms its agreement with you as follows:

1.       This Stock Purchase Agreement (the "Agreement") is made as of March
13, 2002 between Organogenesis Inc., a Delaware corporation (the "Company"),
and the Investor.

2.       The Company has authorized the sale and issuance of (i) 100,000 shares
(the "Preferred Shares") of Series D Convertible Preferred Stock of the
Company, $1.00 par value per share (the "Series D Preferred Stock") including
the right to buy additional shares of Series D Preferred Stock, and (ii)
7,241,380 shares (the "Common Shares") of Common Stock of the Company and the
Common Stock Warrants, to certain investors in a private placement (the
"Offering").

3.       The Company and the Investor agree that the Investor will, pursuant to
the Terms and Conditions for Purchase of Shares attached hereto as Annex I and
incorporated herein by reference as if fully set forth herein (the "Terms and
Conditions"),

                  i) purchase from the Company and the Company will issue and
         sell to the Investor ___________ Preferred Shares, for a purchase price
         of $65.00 per share, or an aggregate purchase price of
         $_______________, including the right to buy _____ additional shares of
         Series D Preferred Stock (which number is twenty percent (20%) of the
         Preferred Shares purchased by the Investor at the Closing); and/or

                  ii) purchase from the Company and the Company will issue and
         sell to the Investor ___________ Common Shares, for a purchase price of
         $1.45 per share or an aggregate purchase price of $_________, including
         ______ warrants to acquire the number of shares of Common Stock (the
         "Common Stock Warrants") (which number is fifty percent (50%) of the
         Common Shares purchased by the Investor at the Closing) substantially
         in the form attached hereto as Exhibit B. The shares of Common Stock
                                        ---------
         issuable upon exercise of the Common Stock Warrants are referred to
         herein as the "Warrant Common Stock Shares."

Unless otherwise requested by the Investor, certificates representing the
Preferred Shares and/or Common Shares, and the Common Stock Warrants, purchased
by the Investor will be registered in the Investor's name and address as set
forth below.

4.       The Investor represents that, except as set forth below, (a) it has
had no position, office or other material relationship within the past three
years with the Company or persons known to it to be affiliates of the Company,
(b) neither it, nor any group of which it is a member or to which it is
related, beneficially owns (including the right to acquire or vote) any
securities of the Company and (c) it has no direct or indirect affiliation or
association with any NASD member as of the date hereof. Exceptions:

______________________________________________________________________________
______________________________________________________________________________.
         (If no exceptions, write "none." If left blank, response will be
deemed to be "none.")

<PAGE>

         Please confirm that the foregoing correctly sets forth the agreement
between us by signing in the space provided below for that purpose. By executing
this Agreement, you acknowledge that the Company may use the information in
paragraph 4 above and the name and address information below in preparation of
the Registration Statement (as defined in Annex 1).

AGREED AND ACCEPTED:
-------------------
ORGANOGENESIS INC.                      INVESTOR:

By:______________________________       By:______________________________
   John Arcari                          Print Name:______________________
   Chief Financial Officer              Title:___________________________
                                        Address:_________________________
                                        E-mail Address:__________________
                                        Tax ID No.:______________________
                                        Contact Name:____________________
                                        Telephone:_______________________
                                        Name in which shares should be
                                        registered (if different)
                                        _________________________________

                                      2

<PAGE>

THE PREFERRED SHARES, THE ADDITIONAL SHARES RIGHT, THE COMMON SHARES AND THE
COMMON STOCK WARRANTS HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT, AND,
UNLESS SO REGISTERED, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EXEMPTION
FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT. THE PREFERRED SHARES, THE ADDITIONAL SHARES RIGHT, THE COMMON
SHARES AND THE COMMON STOCK WARRANTS HAVE NOT BEEN APPROVED OR DISAPPROVED BY
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR
HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON OR ENDORSED THE MERITS OF THIS OFFERING OR THE ACCURACY OR ADEQUACY
OF THESE TERMS AND CONDITIONS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.

EACH INVESTOR MUST RELY ON THE INVESTOR'S OWN EXAMINATION OF THE COMPANY AND THE
TERMS OF THE OFFERING, INCLUDING THE MERITS AND RISKS INVOLVED IN MAKING AN
INVESTMENT DECISION WITH RESPECT TO THE PREFERRED SHARES, THE ADDITIONAL SHARES
RIGHT, THE COMMON SHARES AND/OR THE COMMON STOCK WARRANTS. PRIOR TO MAKING AN
INVESTMENT DECISION REGARDING THE PREFERRED SHARES, THE ADDITIONAL SHARES RIGHT,
THE COMMON SHARES AND/OR THE COMMON STOCK WARRANTS, A PROSPECTIVE INVESTOR
SHOULD CONSULT HIS OWN COUNSEL, ACCOUNTANT AND OTHER ADVISORS AND CAREFULLY
REVIEW AND CONSIDER THESE TERMS AND CONDITIONS AND THE STOCK PURCHASE AGREEMENT.

THIS OFFERING IS BEING MADE IN RELIANCE ON AN EXEMPTION FROM REGISTRATION UNDER
THE SECURITIES ACT AND CERTAIN STATE SECURITIES LAWS AS AN OFFER AND SALE OF
PREFERRED SHARES, ADDITIONAL SHARES RIGHT, COMMON SHARES AND COMMON STOCK
WARRANTS NOT INVOLVING ANY PUBLIC OFFERING. THE PREFERRED SHARES, THE ADDITIONAL
SHARES RIGHT, THE COMMON SHARES AND THE COMMON STOCK WARRANTS ARE NOT
TRANSFERABLE WITHOUT THE SATISFACTION OF CERTAIN CONDITIONS, INCLUDING
REGISTRATION OR THE AVAILABILITY OF AN EXEMPTION UNDER THE SECURITIES ACT, AND
THE SECURITIES LAWS OF CERTAIN STATES. EACH PROSPECTIVE INVESTOR IN THE SHARES
MUST COMPLY WITH ALL APPLICABLE LAWS IN FORCE IN ANY JURISDICTION IN WHICH IT
PURCHASES, OFFERS OR SELLS THE PREFERRED SHARES, THE ADDITIONAL SHARES RIGHT,
THE COMMON SHARES AND THE COMMON STOCK WARRANTS, AND, EXCEPT AS OTHERWISE
EXPLICITLY PROVIDED HEREIN, THE COMPANY SHALL NOT HAVE ANY RESPONSIBILITY
THEREFOR. PROSPECTIVE INVESTORS SHOULD ASSUME THAT THEY MAY HAVE TO BEAR THE
ECONOMIC RISK OF AN INVESTMENT IN THE SHARES FOR AN INDEFINITE PERIOD OF TIME.

THE COMPANY UNDERTAKES TO MAKE AVAILABLE TO EVERY INVESTOR, DURING THE COURSE OF
THIS TRANSACTION AND PRIOR TO SALE, THE OPPORTUNITY TO ASK QUESTIONS OF, AND
RECEIVE ANSWERS FROM, THE COMPANY CONCERNING THE TERMS AND CONDITIONS OF THE
OFFERING AND TO PROVIDE EVERY INVESTOR UPON REQUEST WITH ANY ADDITIONAL
INFORMATION THE COMPANY POSSESSES OR CAN OBTAIN WITHOUT UNREASONABLE EFFORT IN
ORDER TO VERIFY THE STATEMENTS MADE IN THE MEMORANDUM (AS DEFINED HEREIN).

NO PERSON OTHER THAN THE COMPANY HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR
TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THESE TERMS AND
CONDITIONS IN CONNECTION WITH THE OFFERING, AND, IF GIVEN OR MADE, SUCH OTHER
INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN MADE OR
AUTHORIZED BY THE COMPANY OR THE PLACEMENT AGENT.

                                      3

<PAGE>

                                     ANNEX I

         TERMS AND CONDITIONS FOR PURCHASE OF SHARES

         1.       Authorization and Sale of the Shares. Subject to these Terms
                  ------------------------------------
and Conditions, the Company has authorized the sale of (a) 100,000 Preferred
Shares at the price of $65.00 per share and rights to purchase an additional
36,112 shares of Series D Stock, having the rights, restrictions, privileges and
preferences set forth in the Certificate of Designation, Preferences and Rights
of Series D Convertible Stock attached hereto as Exhibit C (the "Certificate of
                                                 ---------
Designation"), and (b) 7,241,380 Common Shares at the price of $1.45 per share,
plus Common Stock Warrants to purchase 3,620,690 shares of Common Stock. Before
the Closing, the Company will have adopted and filed the Certificate of
Designation with the Secretary of the State of the State of Delaware. The
Company reserves the right to increase the number of Preferred Shares or Common
Shares in the Offering.

         2.       Agreement to Sell and Purchase the Shares.
                  -----------------------------------------

                  2.1      At the Closing (as defined in Section 4), the Company
will sell to the Investor, and the Investor will purchase from the Company, upon
the terms and conditions hereinafter set forth, the number of Preferred Shares
and/or Common Shares and Common Stock Warrants set forth in Section 3 of the
Stock Purchase Agreement to which these Terms and Conditions are attached at the
purchase price set forth thereon.

                  2.2      The Company may enter into the same form of Stock
Purchase Agreement, including these Terms and Conditions, with certain other
investors (the "Other Investors") and expects to complete sales of Preferred
Shares and/or Common Shares and Common Stock Warrants to them concurrent with
the sale of Shares provided herein. (The Investor and the Other Investors are
hereinafter sometimes collectively referred to as the "Investors," and the Stock
Purchase Agreement to which these Terms and Conditions are attached and the
Stock Purchase Agreements (including attached Terms and Conditions) executed by
the Other Investors are hereinafter sometimes collectively referred to as the
"Agreements."). The names, purchased share amounts and purchase prices for such
Other Investors are as set forth on Schedule 2.2 attached hereto.
                                    ------------

                  2.3      Independent Nature of Investors' Obligations and
                           ------------------------------------------------
Rights. The rights and obligations of each Investor under any Agreement are
------
several and not joint with the rights and obligations of the Other Investors and
an Investor shall not be responsible in any way for the performance of the
obligations of the Other Investors under any Agreement. Nothing contained herein
or in any Agreement, and no action taken by any Investor pursuant thereto shall
constitute the Investors as a partnership, an association, a joint venture or
any other kind of entity, or create a presumption that the Investors are in any
way acting in concert with respect to such obligations or the transactions
contemplated by the Agreement. Except as provided herein, in the Certificate of
Designation creating the Series D Preferred Stock and under Delaware law, each
Investor shall be entitled to independently protect and enforce its rights,
including without limitation the rights arising out of this Agreement or out of
the other Agreements, and it shall not be necessary for the Other Investors to
be joined as an additional party in any proceeding for such purpose.

         3.       Additional Shares Right
                  -----------------------

3.1      Grant of Right. Until March 13, 2003, each purchaser of Preferred
         --------------
Shares has the additional one time right to purchase up to the number of shares
of Series D Preferred Stock (the "Right Preferred Shares") equal to 20% of the
number of such shares purchased by the Investor at the Closing at the price of
$65.00 per share (the "Additional Shares Right"). Notwithstanding the foregoing,
the Additional Shares Right shall only be exercisable by an Investor purchasing
Preferred Shares to the extent that the sum of (a) all Common Stock of the
Company beneficially owned by such Investor (when aggregated with all Common
Stock beneficially owned by all Affiliates of such Investor and all other
persons, if any, with whom such Investor's Common Stock would be aggregated)
plus (b) the shares of Common Stock underlying the Additional Shares Right so
exercisable by all of the foregoing, does not exceed 9.99% of the Company's
Common Stock (in each case eliminating double-counting but in all respects
computed in accordance with Sections 13 and 16 of the Securities Exchange Act of
1934, as amended).

                  3.2      Method of Exercise. The Additional Shares Right may
                           ------------------
be exercised by each such purchaser of Preferred Shares by written notice to the
Company or its designee in the form of Exhibit D attached
                                       ---------

<PAGE>

hereto duly completed and executed and indicating the number of shares subject
to the Additional Shares Right which are being purchased. Certificates for the
shares issuable upon exercise of the Additional Shares Right shall be issued as
soon as practicable after the notice is received.

                  3.3       Termination Upon Certain Events. If there shall be a
                            -------------------------------
merger or consolidation of the Company with or into another corporation (other
than a merger or reorganization involving only a change in the state of
incorporation of the Company or the acquisition by the Company of other
businesses where the Company survives as a going concern), or the sale of all or
substantially all of the Company's capital stock or asset to any other person,
or the liquidation or dissolution of the Company, then as a part of such
transaction, at the Company's option, either:

                  (a)      provision shall be made so that the Investor shall
                           thereafter be entitled to receive the number of
                           shares of stock or other securities or property of
                           the Company, or of the successor corporation
                           resulting from the merger, consolidation or sale, to
                           which the Investor would have been entitled if the
                           Investor had exercised its right pursuant to the
                           Additional Shares Right immediately prior thereto; or

                  (b)      the Additional Shares Right shall terminate on the
                           effective date of such merger, consolidation or sale
                           (the "Termination Date") and become null and void;
                           provided that if the Additional Shares Right shall
                           --------
                           not have otherwise terminated or expired, (1) the
                           Company shall have given the Investor written notice
                           of such Termination Date at least twenty (20)
                           business days prior to the occurrence thereof and
                           (2) the Investor shall have the right until 5:00
                           p.m., Eastern Standard Time, on the day immediately
                           prior to the Termination Date to exercise its rights
                           hereunder to the extent not previously exercised.

                  3.4      Transferability. Without the prior written consent of
                           ---------------
the Company, the Additional Shares Right shall not be assigned, pledged or
hypothecated in any way (whether by operation of law or otherwise) and shall not
be subject to execution, attachment or similar process. Any attempted transfer,
assignment, pledge, hypothecation or other disposition of this Additional Shares
Right contrary to the provisions of this Section 3.4, or the levy of any
attachment or similar process upon the Additional Shares Right shall be null and
void.

                  3.5      No Additional Rights as Stockholder. Until the
                           -----------------------------------
exercise of this Additional Shares Right, the Investor shall not have or
exercise any rights as a stockholder of the Company with respect to the Right
Preferred Shares and Right Conversion Shares that may be issuable pursuant to
the Additional Shares Right.

         4.       Delivery of the Shares at Closing. The completion of the
                  ---------------------------------
purchase and sale of the Preferred Shares, the Additional Shares Right and/or
Common Shares and Common Stock Warrants (the "Closing") shall occur on or after
March 18, 2002 (the "Closing Date") at the offices of the Company's counsel. The
Closing shall be for not less that $17 million. At the Closing, the Company
shall instruct the Company's transfer agent to deliver to the Investor one or
more stock certificates representing the number of Preferred Shares or Common
Shares set forth in Section 3 of the Stock Purchase Agreement, each such
certificate to be registered in the name of the Investor or, if so indicated on
the signature page of the Stock Purchase Agreement, in the name of a nominee
designated by the Investor.

         The Company's obligation to issue the Preferred Shares, the Additional
Shares Right and/or Common Shares and Common Stock Warrants to the Investor
shall be subject to the following conditions, any one or more of which may be
waived by the Company: (a) receipt by the Company of a certified or official
bank check or wire transfer of funds in the full amount of the purchase price
for the Shares being purchased hereunder as set forth in Section 3 of the Stock
Purchase Agreement; (b) completion of the purchases and sales under the
Agreements with the Other Investors; and (c) the accuracy of the representations
and warranties made by the Investor and the fulfillment of those undertakings of
the Investors to be fulfilled prior to the Closing.

         The Investor's obligation to purchase the Preferred Shares, the
Additional Shares Right and/or Common Shares and Common Stock Warrants shall be
subject to the following conditions, any one or more of which may be waived by
the Investor: (a) the representations and warranties of the Company set forth
herein shall be true and correct as of the Closing Date in all material respects
(unless such representation and warranty is qualified by

                                      2

<PAGE>

materiality, in which case it shall be true and correct in all respects) and the
Investors shall have received a certificate of the Chief Executive Officer of
the Company to such effect; (b) the Offering shall be fully subscribed; and (c)
the Investor shall have received such documents as such Investor shall
reasonably have requested, including an opinion of Company Counsel, in the form
attached as Exhibit E hereto, addressed to Needham & Company, Inc., in its
            ---------
capacity as placement agent for this transaction (the "Placement Agent") and the
Investors, as to the matters set forth in Section 5.2 and, subject to the
accuracy of the information and the representations and warranties required to
be provided by each Investor, as to exemption from the registration requirements
of the Securities Act of 1933, as amended (the "Securities Act"), of the sale of
the Preferred Shares, Common Shares or Common Stock Warrants.

         5.       Representations, Warranties and Covenants of the Company. The
                  --------------------------------------------------------
Company hereby represents and warrants to, and covenants with, the Investor, as
follows:

                  5.1      Organization. The Company and its Subsidiaries (as
                           ------------
defined in Rule 405 under the Securities Act) are each duly organized and
validly existing in good standing under the laws of the jurisdiction of its
organization. A list of the Company's Subsidiaries and all entities in which the
Company owns an equity or convertible debt interest is set forth on Schedule
                                                                    --------
5.1. Each of the Company and its Subsidiaries has full power and authority to
---
own, operate and occupy its properties and to conduct its business as presently
conducted and as described in the documents filed by the Company under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), since the end
of December 31, 2000 through the date hereof, including, without limitation, its
most recent reports on Form 10-K, as amended, Form 10-Q and Form 8-K (the
"Exchange Act Documents") and is registered or qualified to do business and in
good standing in each jurisdiction in which the nature of the business conducted
by it or the location of the properties owned or leased by it requires such
qualification and where the failure to be so qualified would have a material
adverse effect upon the business, properties or operations of the Company and
its Subsidiaries, considered as one enterprise (a "Material Adverse Effect").

                  5.2      Due Authorization and Valid Issuance. The Company has
                           ------------------------------------
all requisite power and authority to execute, deliver and perform its
obligations under the Agreements, and the Agreements have been duly authorized
and validly executed and delivered by the Company and constitute legal, valid
and binding agreements of the Company enforceable against the Company in
accordance with their terms, except as rights to indemnity and contribution may
be limited by state or federal securities laws or the public policy underlying
such laws, except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting creditors' and
contracting parties' rights generally and except as enforceability may be
subject to general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law). The issuance,
sale and delivery of the Preferred Shares, Common Shares and Common Stock
Warrants in accordance with this Agreement, the issuance and delivery of the
shares of common stock of the Company, par value $0.01 per share (the "Common
Stock"), issuable upon conversion of the Preferred Shares (the "Preferred
Conversion Shares"), the Right Preferred Shares issuable upon exercise of the
Additional Shares Right, the shares of Common Stock issuable upon the conversion
of the Right Preferred Shares (the "Right Conversion Shares"), and the Warrant
Common Stock Shares issuable upon exercise of the Common Stock Warrants, have
been, or will be prior to the Closing, duly authorized and all such shares have
been duly reserved for issuance, as the case may be, by all necessary corporate
action on the part of the Company. The Preferred Shares and the Common Shares
when so issued, sold and delivered against payment therefor in accordance with
the provisions of this Agreement, and the Right Preferred Shares and Warrant
Common Stock Shares when issued and delivered against payment therefor pursuant
to the terms of this Agreement and the Common Stock Warrants, respectively, and
the Preferred Conversion Shares and Right Conversion Shares upon conversion of
the Preferred Shares and Right Preferred Shares, respectively, will each be
validly issued, fully paid and nonassessable.

                  5.3      Non-Contravention. The execution and delivery of the
                           -----------------
Agreements, the issuance and sale of the Shares under the Agreements, the
fulfillment of the terms of the Agreements and the consummation of the
transactions contemplated thereby will not, except with respect to any existing
registration rights for which waivers have been obtained prior to closing: (A)
conflict with or constitute a violation of, or default (with the passage of time
or otherwise) under, (i) any bond, debenture, note or other evidence of
indebtedness, lease, contract, indenture, mortgage, deed of trust, loan
agreement, joint venture or other agreement or instrument to which the Company
or any Subsidiary is a party or by which it or any of its Subsidiaries or their
respective properties are bound, (ii) the charter, by-laws or other
organizational documents of the Company or any Subsidiary, or (iii) any law,
administrative regulation, ordinance or order of any court or governmental
agency, arbitration panel or authority

                                      3

<PAGE>

applicable to the Company or any Subsidiary or their respective properties,
except in the case of clauses (i) and (iii) for any such conflicts, violations
or defaults which are not reasonably likely to have a Material Adverse Effect or
(B) result in the creation or imposition of any lien, encumbrance, claim,
security interest or restriction whatsoever upon any of the material properties
or assets of the Company or its Subsidiaries, taken as a whole, or an
acceleration of indebtedness pursuant to any obligation, agreement or condition
contained in any material bond, debenture, note or other evidence of
indebtedness or any indenture, mortgage, deed of trust or other material
agreement or instrument to which the Company or any Subsidiary is a party or by
which any of them is bound or to which any of the material property or assets of
the Company or any Subsidiary is subject. Except for sending a notice of
issuance of the Shares to the American Stock Exchange ("AMEX"), no consent,
approval, authorization or other order of, or registration, qualification or
filing with, AMEX, any regulatory body, administrative agency, or other
governmental body in the United States or any other person is required for the
execution and delivery of the Agreements and the valid issuance and sale of the
Preferred Shares, the Preferred Conversion Shares, the Common Shares, the
Additional Shares Right, the Right Preferred Shares, the Right Conversion
Shares, the Common Stock Warrants, or the Warrant Common Stock Shares, to be
sold pursuant to the Agreements, other than such as have been made or obtained,
and except for any post-closing securities filings or notifications required to
be made under federal or state securities laws.

                  5.4      Capitalization. The capitalization of the Company is
                           --------------
as set forth in the confidential private placement memorandum dated January 17,
2002 relating to the offering of the Shares (the "Memorandum"), except as set
forth on Schedule 5.4 hereto. The Company has not issued any capital stock since
March 12, 2002 other than pursuant to (i) employee benefit plans disclosed in
the Exchange Act Documents and (ii) outstanding warrants, options or other
securities disclosed in the Memorandum. The outstanding shares of capital stock
of the Company have been duly and validly issued and are fully paid and
nonassessable, have been issued in compliance with all federal and state
securities laws, and were not issued in violation of any preemptive rights or
similar rights to subscribe for or purchase securities. Except as set forth in
or contemplated by the Memorandum or as set forth on Schedule 5.4 hereto, there
are no outstanding rights (including, without limitation, preemptive rights),
warrants or options to acquire, or instruments convertible into or exchangeable
for, any unissued shares of capital stock or other equity interest in the
Company or any Subsidiary, or any contract, commitment, agreement, understanding
or arrangement of any kind to which the Company is a party or of which the
Company has knowledge and relating to the issuance or sale of any capital stock
of the Company or any Subsidiary, any such convertible or exchangeable
securities or any such rights, warrants or options. Without limiting the
foregoing, except as set forth on Schedule 5.4 hereto, no preemptive right,
co-sale right, right of first refusal, registration right, or other similar
right exists with respect to the Preferred Shares, the Preferred Conversion
Shares, the Common Shares, the Additional Shares Right, the Right Preferred
Shares, the Right Conversion Shares, the Common Stock Warrants, or the Warrant
Common Stock Shares, or the issuance and sale thereof. No further approval or
authorization of any stockholder, the Board of Directors of the Company or
others is required for the issuance and sale of the Preferred Shares, the
Preferred Conversion Shares, the Common Shares, the Additional Shares Right, the
Right Preferred Shares, the Right Conversion Shares, the Common Stock Warrants,
or the Warrant Common Stock Shares. The Company owns the entire equity interest
in each of its Subsidiaries, free and clear of any pledge, lien, security
interest, encumbrance, claim or equitable interest, other than as described in
the Memorandum. Except as disclosed in the Memorandum, there are no stockholder
agreements, voting agreements or other similar agreements with respect to the
Series D Preferred Stock or the Common Stock to which the Company is a party or,
to the knowledge of the Company, between or among any of the Company's
stockholders. The Company agrees not to purchase shares of Common Stock pursuant
to the stock repurchase program previously adopted by the Board of Directors
prior to March 13, 2003. The Rights Agreement between the Company and American
Stock Transfer & Trust company dated as of September 1, 1995, as amended,
entitles the holders of Common Stock of the Company to certain rights as set
forth therein.

                  5.5      Legal Proceedings. There is no material legal or
                           -----------------
governmental proceeding pending or, to the knowledge of the Company, threatened
to which the Company or any Subsidiary is or may be a party or of which the
business or property of the Company or any Subsidiary is subject that is not
disclosed in the Memorandum, except as set forth on Schedule 5.5 hereto.

                  5.6      No Violations. Neither the Company nor any Subsidiary
                           -------------
is in violation of its charter, bylaws, or other organizational document, or in
violation of any law, administrative regulation, ordinance or order of any court
or governmental agency, arbitration panel or authority applicable to the Company
or any Subsidiary,

                                      4

<PAGE>

which violation, individually or in the aggregate, would be reasonably likely to
have a Material Adverse Effect, or is in default (and there exists no condition
which, with the passage of time or otherwise, would constitute a default) in any
material respect in the performance of any bond, debenture, note or any other
evidence of indebtedness in any indenture, mortgage, deed of trust or any other
material agreement or instrument to which the Company or any Subsidiary is a
party or by which the Company or any Subsidiary is bound or by which the
properties of the Company or any Subsidiary are bound, which would be reasonably
likely to have a Material Adverse Effect assuming the Closing of this offering.

                  5.7      Governmental Permits, Etc. With the exception of the
                           -------------------------
matters which are dealt with separately in Section 5.1 and 5.3, each of the
Company and its Subsidiaries has all necessary franchises, licenses,
certificates and other authorizations from any foreign, federal, state or local
government or governmental agency, department, or body that are currently
necessary for the operation of the business of the Company and its Subsidiaries
as currently conducted and as described in the Memorandum except where the
failure to currently possess could not reasonably be expected to have a Material
Adverse Effect.

                  5.8      Intellectual Property. Except as otherwise disclosed
                           ---------------------
the Memorandum, (a) Each of the Company and its Subsidiaries owns, or is validly
licensed or otherwise has the right to use all patents, patent applications,
trademarks, trademark rights, trade names, trade name rights, domain names,
service marks, service mark rights, copyrights, trade secrets, technical
know-how and other proprietary intellectual property rights (collectively,
"Intellectual Property Rights") that are necessary to the conduct of the
business of the Company and its Subsidiaries, taken as a whole, as now conducted
or as proposed to be conducted as described in the Memorandum, in each case, to
the knowledge of the Company, free and clear of all liens, except where the
failure to own, license or have the right to use such Intellectual Property
Rights would not have a Material Adverse Effect. The Memorandum sets forth, as
of the date hereof, all agreements under which the Company or any Subsidiary of
the Company is obligated to make payments to third parties for the use of any
Intellectual Property Rights with respect to the commercialization of any
products that are, as of the date hereof, being sold, manufactured by or under
development by the Company or any of its Subsidiaries.

         (b)      To the knowledge of the Company, neither the Company nor any
         of its Subsidiaries is infringing or has received notice of or has any
         knowledge of any asserted infringement by the Company or any of its
         Subsidiaries (including with respect to the manufacture, use or sale
         by the Company or any of its Subsidiaries of their respective
         commercial products) of the rights of any person with regard to any
         Intellectual Property Right which, individually or in the aggregate,
         would have a Material Adverse Effect. As of the date of this
         Agreement, to the knowledge of the Company, no person or persons are
         infringing on the rights of the Company or any of its Subsidiaries
         with respect to any Intellectual Property Right in a manner which,
         individually or in the aggregate, would have a Material Adverse Effect.

         (c)      No claims are pending or, to the knowledge of the Company,
         threatened with regard to the ownership by the Company or any of its
         Subsidiaries of any of their respective Intellectual Property Rights
         which, individually or in the aggregate, would have a Material Adverse
         Effect.

         (d)      All patents, trademarks and applications therefor owned by the
         Company or any of its Subsidiaries have been duly registered, filed
         with or issued by each appropriate governmental authorities, all
         necessary affidavits of continuing use have been filed and all
         necessary material maintenance fees have been timely paid to continue
         all such rights in effect, except where the failure to timely pay would
         not have a Material Adverse Effect. To the Company's knowledge, none of
         the Company's patents have been declared invalid or unenforceable, in
         whole or in part, by any governmental authority. Each inventor named on
         the patents and patent applications of the Company or any of its
         Subsidiaries has executed an agreement assigning his, her or its entire
         right, title and interest in and to such patent or patent application,
         and the inventions embodied and claimed therein, to the Company or a
         Subsidiary of the Company.

         (e)      Except as disclosed in the Memorandum, the Company has not
         granted material licenses or options for licenses to Intellectual
         Property Rights.

         (f)      The Company uses, and has used, commercially reasonable
         efforts to maintain the confidentiality of its trade secrets.

                                      5

<PAGE>

                  5.9      Financial Statements. The financial statements of the
                           --------------------
Company and the related notes contained in the Exchange Act Documents present
fairly, in accordance with generally accepted accounting principles, the
financial position of the Company and its Subsidiaries on a consolidated basis,
as of the dates indicated, and the results of its operations and cash flows for
the periods therein specified consistent with the books and records of the
Company and its Subsidiaries on a consolidated basis, except that the unaudited
interim financial statements were or are subject to normal and recurring
year-end adjustments which are not expected to be material in amount. Such
financial statements (including the related notes) have been prepared in
accordance with generally accepted accounting principles applied on a consistent
basis throughout the periods therein specified, except as may be included in the
notes to such financial statements, or in the case of unaudited statements, as
may be permitted by the SEC on Form 10-Q under the Exchange Act. The financial
information contained in the Memorandum has been prepared on a basis consistent
with the financial statements of the Company.

                  5.10     No Material Adverse Change. Except as disclosed in
                           --------------------------
the Memorandum, since September 30, 2001, there has not been (i) any material
adverse change in the financial condition or earnings of the Company and its
Subsidiaries considered as one enterprise, (ii) any material adverse event
affecting the Company or its Subsidiaries, (iii) any obligation, direct or
contingent, that is material to the Company and its Subsidiaries considered as
one enterprise, incurred by the Company or any Subsidiary, except obligations
incurred in the ordinary course of business, (iv) any dividend or distribution
of any kind declared, paid or made on the capital stock of the Company or any of
its Subsidiaries, or (v) any loss or damage (whether or not insured) to the
physical property of the Company or any of its Subsidiaries which has been
sustained which has or would have a Material Adverse Effect.

                  5.11     AMEX Compliance. The Company's Common Stock is
                           ---------------
registered pursuant to Section 12(b) of the Exchange Act and is listed on the
AMEX. The Company has taken no action designed or likely to have the effect of,
terminating the registration of the Common Stock under the Exchange Act or
de-listing the Common Stock from the AMEX, nor has the Company received any
notification that the Securities and Exchange Commission (the "SEC") or the AMEX
is terminating such registration or listing, except as disclosed in the
Memorandum.

                  5.12     Reporting Status. The Company has filed in a timely
                           ----------------
manner all documents that the Company was required to file under the Exchange
Act during the 12 months preceding the date of this Agreement. The following
documents, which are all the documents required to be filed by the Company under
the Exchange Act during the 12 months preceding the date of this Agreement,
complied in all material respects with the SEC's requirements as of their
respective filing dates, and the information contained therein as of the date
thereof did not contain an untrue statement of a material fact or omit to state
a material fact required to be stated therein or necessary to make the
statements therein in light of the circumstances under which they were made not
misleading:

                  (a)          .   Annual Report on Form 10-K for the fiscal
                               year ended December 31, 2000, filed on April 2,
                               2001 and amended on April 30, 2001;

                           .   Definitive Proxy Statement, filed on May 24,
                               2001;

                           .   Quarterly Report on Form 10-Q for the fiscal
                               quarter ended March 31, 2001, filed on April 26,
                               2001;

                           .   Quarterly Report on Form 10-Q for the fiscal
                               quarter ended June 30, 2001, filed on August 14,
                               2001;

                           .   Quarterly Report on Form 10-Q for the fiscal
                               quarter ended September 30, 2001, filed on
                               November 14, 2001;

                           .   Current Report on Form 8-K, filed on March 8,
                               2001;

                           .   Current Report on Form 8-K/A, filed on April 24,
                               2001;

                                      6

<PAGE>

                           .   Current Report on Form 8-K, filed on May 10,
                               2001;

                           .   Current Report on Form 8-K, filed on May 16,
                               2001;

                           .   Current Report on Form 8-K, filed on August 14,
                               2001;

                           .   Current Report on Form 8-K, filed on October 17,
                               2001;

                           .   Current Report on Form 8-K, filed on January 4,
                               2002;

                           .   Current Report on Form 8-K, filed on January 30,
                               2002;

                           .   Current Report on Form 8-K, filed on February 6,
                               2002;

                           .   Current Report on Form 8-K, filed on February 25,
                               2002; and

                           .   Current Report on Form 8-K, filed on March 1,
                               2002.

                  (b)      All other documents, if any, filed by the Company
                           with the SEC since March 2, 2002 pursuant to the
                           reporting requirements of the Exchange Act.

                  5.13     Listing. At the Closing the Company shall have
                           -------
complied with all requirements of the AMEX with respect to the issuance of the
Preferred Conversion Shares, the Common Shares, the Right Conversion Shares and
the Warrant Common Stock Shares and the listing thereof on the AMEX.

                  5.14     No Manipulation of Stock. The Company has not,
                           ------------------------
directly or indirectly, taken or caused or knowingly permitted to be taken and
will not, in violation of applicable law, directly or indirectly, take or cause
or knowingly permit to be taken, any action designed to or that might reasonably
be expected to cause or result in stabilization or manipulation of the price of
the Common Stock to facilitate the sale or resale of the Common Shares,
Preferred Conversion Shares, Warrant Common Stock Shares or the Right Conversion
Shares.

                  5.15     Company not an "Investment Company". The Company has
                           -----------------------------------
been advised of the rules and requirements under the Investment Company Act of
1940, as amended (the "Investment Company Act"). The Company is not, and
immediately after receipt of payment for the Preferred Shares, Additional Shares
Right, Common Shares and Common Stock Warrants will not be, an "investment
company" or an entity "controlled" by an "investment company" within the meaning
of the Investment Company Act and shall conduct its business in a manner so that
it will not become subject to the Investment Company Act.

                  5.16     Foreign Corrupt Practices. Neither the Company nor
                           -------------------------
any of its Subsidiaries, nor to the knowledge of the Company, any agent or other
person acting on behalf of the Company or any of its Subsidiaries, has (i)
directly or indirectly, used any corrupt funds for unlawful contributions,
gifts, entertainment or other unlawful expenses related to foreign or domestic
political activity, (ii) made any unlawful payment to foreign or domestic
government officials or employees or to any foreign or domestic political
parties or campaigns from corporate funds, (iii) failed to disclose fully any
contribution made by the Company or any of its Subsidiaries (or made by any
person acting on its behalf of which the Company or any of its Subsidiaries is
aware) which is in violation of law, or (iv) violated in any material respect
any provision of the Foreign Corrupt Practices Act of 1977, as amended.

                  5.17     Accountants. To the Company's knowledge,
                           -----------
PricewaterhouseCoopers LLP, who the Company expects will express its opinion
with respect to the financial statements to be incorporated by reference from
the Company's Annual Report on Form 10-K for the year ended December 31, 2001
into the Registration Statement (as defined below) and the prospectus which
forms a part thereof, are independent accountants as required by the Securities
Act and the rules and regulations promulgated thereunder.

                                      7

<PAGE>

                  5.18     Contracts. The contracts identified in the Memorandum
                           ---------
are in full force and effect on the date hereof, and neither the Company nor, to
the Company's nor its Subsidiaries' knowledge, any other party to such contracts
is in breach of or default under any of such contracts, which breach or default
would have a Material Adverse Effect.

                  5.19     Taxes. All applicable tax returns required to be
                           -----
filed by the Company and each of its Subsidiaries have been prepared and filed
in compliance with all applicable laws and were true, correct and complete in
all material respects when filed, or if not yet filed, have been granted
extensions of the filing dates which extensions have not expired, and all taxes,
assessments, fees and other governmental charges upon the Company, its
Subsidiaries, or upon any of their respective properties, income or franchises,
required to be paid by the Company or its Subsidiaries have been paid, or
adequate reserves therefor have been set up if any of such taxes are being
contested in good faith; or if any of such tax returns have not been filed or if
any such taxes have not been paid or so reserved for, the failure to so file or
to pay would not in the aggregate have a Material Adverse Effect. All amounts
required to be withheld by the Company or any of its Subsidiaries from employees
for income, social security and other payroll taxes have been collected and
withheld and have either been paid to the appropriate agency, set aside in
accounts for such purpose or accrued and reserved upon the books and records of
the Company. There are no tax liens on any of the Company's or any of its
Subsidiary's assets that arose in connection with the failure, or alleged
failure, to pay any taxes, except for liens for taxes not yet due and payable.
No taxing authority is asserting or threatening to assert against the Company or
any of its Subsidiaries any deficiency or claim for additional taxes and no tax
return of Company or any of its Subsidiaries is currently under audit by any tax
authority. For the purposes hereof, the terms "tax" and "taxes," include,
without limitation, all federal, state and local, domestic and foreign, income,
property, sales, franchise, excise and other taxes, tariffs or governmental
charges, including any interest, penalties or additions with respect thereto,
imposed by any governmental authority or any obligation to pay taxes imposed on
any entity for which the Company or any of its Subsidiaries is liable by
operation of law.

                  5.20     Transfer Taxes. On the Closing Date, all stock
                           --------------
transfer or other taxes (other than income taxes) which are required to be paid
in connection with the sale and transfer of the Preferred Shares, Additional
Shares Right and/or Common Shares and Common Stock Warrants to be sold to the
Investor hereunder will be, or will have been, fully paid or provided for by the
Company and all laws imposing such taxes will be or will have been fully
complied with.

                  5.21     Private Offering. Assuming the correctness of the
                           ----------------
representations and warranties of the Investors set forth in Section 6 hereof,
the offer and sale of Preferred Shares, Additional Shares Right, Common Shares
and Common Stock Warrants hereunder is exempt from registration under the
Securities Act. The Company has not distributed and will not distribute prior to
the Closing Date any offering material in connection with this Offering and sale
of the Shares other than the Memorandum, the documents of which this Agreement
is a part, and the Exchange Act Documents. The Company has not in the past nor
will it hereafter take any action independent of the Placement Agent to sell,
offer for sale or solicit offers to buy any securities of the Company which
would bring the offer, issuance or sale of the Shares as contemplated by this
Agreement, within the provisions of Section 5 of the Securities Act, unless such
offer, issuance or sale was or shall be within the exemptions of Section 4 of
the Securities Act.

                  5.22     ERISA Matters. The Company is in compliance in all
                           -------------
material respects with all presently applicable provisions of the Employee
Retirement Income Security Act of 1974, as amended, including the regulations
and published interpretations thereunder ("ERISA"); no "reportable event" (as
defined in ERISA) has occurred with respect to any "pension plan" (as defined in
ERISA) for which the Company or any subsidiary would have any liability; neither
the Company nor any subsidiary has incurred or expects to incur liability under
(i) Title IV of ERISA with respect to termination of, or withdrawal from, any
"pension plan" or (ii) Section 412 or 4971 of the Internal Revenue Code of 1986,
as amended, including the regulations and published interpretations thereunder
(the "Internal Revenue Code"); and each "pension plan" for which the Company
would have any liability that is intended to be qualified under Section 401(a)
of the Internal Revenue Code is so qualified in all material respects and
nothing has occurred, whether by action or by failure to act, which could be
reasonably expected to cause the loss of such qualification.

                                      8

<PAGE>

                  5.23     Books and Records. The books, records and accounts of
                           -----------------
the Company and its Subsidiaries accurately and fairly reflect, in reasonable
detail, the transactions in, and dispositions of, the assets of, and the results
of operations of, the Company and its Subsidiaries. The Company and each of its
Subsidiaries maintains a system of internal accounting controls sufficient to
provide reasonable assurances that (i) transactions are executed in accordance
with management's general or specific authorizations, (ii) transactions are
recorded as necessary to permit preparation of financial statements in
accordance with generally accepted accounting principles and to maintain asset
accountability, (iii) access to assets is permitted only in accordance with
management's general or specific authorization and (iv) the recorded
accountability for assets is compared with the existing assets at reasonable
intervals and appropriate action is taken with respect to any differences.

                  5.24     Environmental Matters. Each of the Company and its
                           ---------------------
Subsidiaries is in compliance in all material respects with all rules, laws and
regulation relating to the use, treatment, storage and disposal of toxic
substances and protection of health or the environment ("Environmental Law")
which are applicable to its business; (i) to the knowledge of the Company, there
is no pending, nor in the past three (3) years has there been, any investigation
of the Company by a governmental entity relating to any Environmental Law; (ii)
neither the Company nor any of its Subsidiaries has received any notice from any
governmental authority or third party of an asserted claim under Environmental
Laws; (iii) each of the Company and its Subsidiaries has received all permits,
licenses or other approvals required of it under applicable Environmental Laws
to conduct its business and is in compliance with all terms and conditions of
any such permit, license or approval; (iv) to the Company's knowledge, no facts
currently exist that will require the Company or its Subsidiaries to make future
material capital expenditures to comply with Environmental Laws; and (v) no
property which is or has been owned, leased or occupied by the Company or its
Subsidiaries has been designated as a Superfund site pursuant to the
Comprehensive Environmental Response, Compensation of Liability Act of 1980, as
amended (42 U.S.C. Section 9601, et seq.) or otherwise designated as a
contaminated site under applicable state or local law.

                  5.25     Regulatory Compliance. Except where the failure would
                           ---------------------
not have a Material Adverse Effect, to the knowledge of the Company, the
testing, manufacture, storage, distribution, use, promotion and sale of products
of the Company or any of its Subsidiaries by the Company, or any of its
Subsidiaries have been performed and is performed in compliance in all material
respects with all applicable laws, regulations and other requirements of the
FDA, including those requirements relating to investigational use, premarket
clearance, good manufacturing practices, labeling, advertising, record keeping,
and filing of reports. Neither the Company nor any of its Subsidiaries has
received any adverse written notice within the past two years that the FDA or
any other similar foreign governmental authority has commenced or threatened to
initiate any action to withdraw its approval or requested the recall of any
product of the Company or any of its Subsidiaries, or commenced, or overtly
threatened to initiate, any action to enjoin production of any such product.

                  5.26     Going Concern. After due inquiry by the Company, the
                           -------------
Company's auditors have not advised the Company (either orally or in writing)
that, assuming the closing of the transactions contemplated hereby, they
currently intend providing to or in respect of the Company any opinion, report,
letter or other correspondence which reflects the auditor's substantial doubt
about the Company's ability to continue as a "going concern" as provided in SAS
No. 59 or Section 10A of the Exchange Act (a "Going Concern Notification") when
the auditors complete their audit of the financial statements for the year ended
December 31, 2001, it being understood the auditors conduct a "going concern"
analysis at the time they issue their opinion regarding such financials. The
Company has not received any Going Concern Notification which has not been
pre-empted, rescinded or otherwise withdrawn.

                  5.27     Full Disclosure. Except as set forth on Schedule 5.27
                           ---------------                         -------------
attached hereto, neither this Agreement nor the Memorandum, when read together,
contains any untrue statement of a material fact or omits a material fact
necessary to make the statements contained herein or therein, in light of the
circumstances under which they were made, not misleading. As of the Closing Date
and other than the transaction contemplated by this Agreement, there is no fact
or circumstance existing which, to the knowledge of the Company, requires the
Company to file a report with the SEC on Form 8-K and for which the Company has
not filed such Form 8-K with the SEC prior to the Closing Date, and the Company
has no present intention to file a Form 8-K for any existing fact or
circumstance known to the Company.

                                      9

<PAGE>

                  5.28     Other Investor Agreements. The stock purchase
                           -------------------------
agreements entered into by the Company with other investors to this offering are
in substantially the same form as this Agreement except with respect to investor
specific information including, but not limited to, the number of Preferred
Shares and Additional Share Rights and/or Common Shares and Common Stock
Warrants purchased.

                  5.29     Form S-3 Eligibility. The Company is eligible to
                           --------------------
register the resale of its Common Stock for resale by the Investor on Form S-3
promulgated under the Securities Act.

                  5.30     No Shareholder Approval. The transactions
                           ------------------------
contemplated by this Agreement do not require shareholder approval under the
rules and regulations of the AMEX.

         6.       Representations, Warranties and Covenants of the Investor.
                  ---------------------------------------------------------

                  6.1      The Investor represents and warrants to, and
covenants with, the Company that: (i) the Investor is an "accredited investor"
as defined in Regulation D under the Securities Act and the Investor is also
knowledgeable, sophisticated and experienced in making, and is qualified to make
decisions with respect to investments in shares presenting an investment
decision like that involved in the purchase of the Shares, including investments
in securities issued by the Company and investments in comparable companies, and
has requested, received, reviewed and considered all information it deemed
relevant in making an informed decision to purchase the Shares; (ii) the
Investor is acquiring the number of Preferred Shares and Additional Shares Right
and/or Common Shares and Common Stock Warrants set forth in Section 3 of the
Stock Purchase Agreement solely for its own account for investment only and with
no present intention of distributing any of the Preferred Shares and Additional
Shares Right and/or Common Shares and Common Stock Warrants; or any arrangement
or understanding with any other persons regarding the distribution of the
Preferred Shares and Additional Shares Right and/or Common Shares and Common
Stock Warrants; (iii) the Investor will not, directly or indirectly, offer,
sell, pledge, transfer or otherwise dispose of (or solicit any offers to buy,
purchase or otherwise acquire or take a pledge of) any of the Preferred Shares,
Additional Shares Right, Common Shares or Common Stock Warrants except in
compliance with the Securities Act, applicable state securities laws and the
respective rules and regulations promulgated thereunder; (iv) the Investor has
answered all questions on the Investor Questionnaire and the answers thereto are
true, correct and complete as of the date hereof and will be true, correct and
complete as of the Closing Date and the Company may rely upon the information in
such answers; (v) the Investor will notify the Company immediately of any
material change in any of such information until such time as the Investor has
sold all of its Preferred Shares or Common Shares and Common Stock Warrants or
until the Company is no longer required to keep the Registration Statement
effective; (vi) the Investor has, in connection with its decision to purchase
the number of Shares set forth in Section 3 of the Stock Purchase Agreement,
relied only upon the Memorandum, the Exchange Act Documents and the
representations and warranties of the Company contained herein; (vii) the
Investor has not recirculated the Memorandum, disclosed the information it
contains or made reproductions in any form; and (vii) there are no suits,
pending litigation or claims against the Investor that could affect the net
worth of the Investor. The Investor understands that its acquisition of the
Preferred Shares and Additional Shares Right and/or Common Shares and Common
Stock Warrants has not been registered under the Securities Act or registered or
qualified under any state securities law in reliance on specific exemptions
therefrom, which exemptions may depend upon, among other things, the bona fide
nature of the Investor's investment intent as expressed herein; provided,
however, without diminishing the effect of any representation or warranty made
herein, nothing contained herein shall be deemed a representation or warranty by
such Investor to hold the Preferred Shares and Additional Shares Right and/or
Common Shares and Common Stock Warrants for any minimum period of time, subject
to the restrictions on transfer set forth in this Agreement.

                  6.2      The Investor acknowledges, represents and agrees that
no action has been or is expected to be taken in any jurisdiction outside the
United States by the Company that would permit an offering of the Preferred
Shares, Additional Shares Right, Common Shares or Common Stock Warrants, or
possession or distribution of offering materials in connection with the issue of
the Preferred Shares, Additional Shares Right, Common Shares and Common Stock
Warrants, in any jurisdiction outside the United States where legal action by
the Company for that purpose is required. If the Investor is outside the United
States, the Investor will comply with all applicable laws and regulations in
each foreign jurisdiction in which it purchases, offers, sells or delivers
Shares or has in its possession or distributes any offering material, in all
cases at its own expense. The Investor acknowledges the Placement Agent is not
authorized to make any representation or use any information in

                                      10

<PAGE>

connection with the issue, placement, purchase and sale of the Preferred Shares
and Additional Shares Right and/or Common Shares and Common Stock Warrants other
than as contained herein or in the Memorandum.

                  6.3     The Investor hereby covenants with the Company not to
 make any sale of the Preferred Shares, Common Shares or Common Stock Warrant
Shares without complying with the provisions of this Agreement and, if
applicable, without causing the prospectus delivery requirement under the
Securities Act to be satisfied, and the Investor acknowledges that the
certificates evidencing the Preferred Shares and Common Shares will be
imprinted with the following legend:

"This security has not been registered under the Securities Act of 1933, as
amended (the "Securities Act"). The holder hereof, by purchasing this security,
agrees for the benefit of ORGANOGENESIS INC. (the "Company") that this security
may be resold, pledged or otherwise transferred only (1) to the Company, (2) if
the Company shall have received an opinion of counsel satisfactory to the
Company that an exemption from registration under the Securities Act is
available, or (3) pursuant to an effective registration statement under the
Securities Act, in each case in accordance with any applicable securities laws
of any state of the United States. This security may be pledged, but not
transferred in violation of the foregoing, in connection with a bona fide margin
account or other loan secured by such securities."

                  The foregoing legend shall be removed from any such
certificates at the request of the Investor (i) upon any sale pursuant to an
effective registration statement under the Securities Act, (ii) upon any sale
pursuant to Rule 144 under the Securities Act, or (iii) at such time as they
become eligible for sale under Rule 144(k) under the Securities Act.

                  The Investor acknowledges that there may occasionally be times
when the Company determines that it must suspend the use of the Prospectus
forming a part of the Registration Statement, as set forth in Section 7.2(c).

                  Notwithstanding anything to contrary contained herein, no
registration or opinion of counsel shall be required for a transfer by an
Investor which is a corporation to its parent entities or to a wholly-owned
subsidiary of such corporation, a transfer by an Investor which is a partnership
to a partner of such partnership or a retired partner of such partnership who
retires after the date hereof or to the estate of any such partner or retired
partner, or a transfer by an Investor which is a limited liability company to a
member of such limited liability company or a retired member who resigns after
the date hereof or to the estate of any such member; provided that the
transferee in each case agrees in writing to be subject to the terms of this
Agreement to the same extent as if it were the original Investor hereunder.

                  The Company acknowledges and agrees that the Investor may from
time to time pledge to a bona fide margin agreement or grant a security interest
in some or all of the securities sold hereunder without the consent of the
Company; provided that such securities may only be disposed of by the Investor
in compliance with all applicable state and federal securities laws. In the
event of any transfer of such securities (other than pursuant to an effective
registration statement) in connection with a pledge, the Company will, if
necessary to comply with applicable securities laws, require the transferring
Investor thereof to provide to the Company an opinion of counsel, the form and
substance of which opinion shall be reasonably satisfactory to the Company, to
the effect that such transfer does not require registration of such transferred
securities under the Securities Act. At the Investor's expense, the Company will
execute and deliver such reasonable documentation as the pledgee or secured
party of such pledged securities may request in connection with the pledge or
transfer of the securities. As a condition of such transfer, the transferee
shall restate the representations and warranties of such Investor under this
Agreement and agree in writing to be bound by the terms of this Agreement and
shall have the rights of the Investor under this Agreement.

                  6.4     The Investor further represents and warrants to, and
covenants with, the Company that (i) the Investor has full right, power,
authority and capacity to enter into this Agreement and to consummate the
transactions contemplated hereby and has taken all necessary action to authorize
the execution, delivery and performance of this Agreement, and (ii) this
Agreement constitutes a legal, valid and binding obligation of the Investor
enforceable against the Investor in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' and contracting

                                      11

<PAGE>

parties' rights generally and except as enforceability may be subject to general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law) and except as the indemnification agreements
of the Investors herein may be legally unenforceable.

                  6.5     To the extent prohibited by applicable securities
 laws, the Investor will not, prior to the effectiveness of the Registration
Statement, sell, offer to sell, solicit offers to buy, dispose of, loan, pledge
or grant any right with respect to the Series D Preferred Stock or the Common
Stock of the Company.

                  6.6     The Investor understands that nothing in the
 Memorandum, this Agreement or any other materials presented to the Investor in
connection with the purchase and sale of the Shares constitutes legal, tax or
investment advice. The Investor has consulted such legal, tax and investment
advisors as it, in its sole discretion, has deemed necessary or appropriate in
connection with its purchase of Preferred Shares and Additional Shares Right
and/or Common Shares and Common Stock Warrants.

                  6.7     The undersigned acknowledges that there may
 occasionally be times when the Company determines that it must suspend the use
of the Prospectus forming a part of the Registration Statement and/or
Additional Shares Registration Statement, as set forth in Section 8.2(c). The
Investor is aware that, in such event, the Preferred Conversion Shares, the
Common Shares, the Warrant Common Stock Shares and/or the Right Conversion
Shares, as the case may be, will not be subject to ready liquidation, and that
any of the Preferred Conversion Shares, the Common Shares, the Warrant Common
Stock Shares and/or the Right Conversion Shares, as the case may be, purchased
by the Investor cannot be sold pursuant to such Prospectus filed in connection
with the Registration Statement or the Additional Shares Registration
Statement, as the case may be. The overall commitment of the Investor to
investments which are not readily marketable is not excessive in view of the
Investor's net worth and financial circumstances, and any purchase of the
Preferred Conversion Shares, the Common Shares, the Warrant Common Stock Shares
and/or the Right Conversion Shares, as the case may be, will not cause such
commitment to become excessive. The Investor is able to bear the economic risk
of an investment in the Preferred Conversion Shares, the Common Shares, the
Warrant Common Stock Shares and/or the Right Conversion Shares, as the case may
be.

                  6.8     The Investor has carefully considered the potential
 risks relating to the Company and a purchase of the Preferred Conversion
Shares, the Common Shares, the Warrant Common Stock Shares and/or the Right
Conversion Shares, as the case may be, and fully understands that the Preferred
Conversion Shares, the Common Shares, the Warrant Common Stock Shares and/or
the Right Conversion Shares, as the case may be, are speculative investments
which involve a high degree of risk of loss of the Investor's entire
investment. Among others, the Investor has carefully considered each of the
risks identified in the Memorandum and the Exchange Act Documents.

                  6.9     The Investor acknowledges that the Company has agreed
 to pay the Placement Agent an aggregate fee of 6.0% of the gross proceeds to
the Company from the Offering.

         7.       Survival of Representations, Warranties and Agreements.
                  ------------------------------------------------------
Notwithstanding any investigation made by any party to this Agreement, all
covenants, agreements, representations and warranties made by the Company and
the Investor herein shall survive the execution of this Agreement, the delivery
to the Investor of the Preferred Shares, the Additional Shares Right and/or the
Common Shares and Common Stock Warrants being purchased and the payment
therefor.

         8.       Registration of the Shares; Compliance with the Securities
                  ----------------------------------------------------------
                  Act.
                  ---

                  8.1      Registration Procedures and Other Matters. The
                           -----------------------------------------
                            Company shall:

                            (a)

                                    (i)     prepare and file with the SEC,
         within 30 days after the Closing Date, a registration
         statement on Form S-1 or Form S-3 (the "Registration Statement") to
         enable the resale of the Preferred Conversion Shares, the Common
         Shares and the Warrant Common Stock Shares by the Investors

                                      12

<PAGE>

         who have provided necessary information regarding their identities
         and shareholdings in the Company from time to time on the AMEX or in
         privately-negotiated transactions;

                                    (ii)    at such time as fifty percent
          (50%) of the aggregate Right Preferred Shares have been issued by the
         Company pursuant to the exercise of the Additional Shares Right, the
         Company shall notify the remaining holders of the Additional Shares
         Right that they have twenty-one (21) days from the date of such notice
         (the "Registration Rights Deadline") to exercise their Additional
         Shares Right; thereafter the Company shall prepare and file with the
         SEC a registration statement on Form S-1 or Form S-3 (the "Additional
         Shares Registration Statement") to enable the resale of the Right
         Conversion Shares by the Investors who have provided necessary
         information regarding their identities and shareholdings in the
         Company from time to time on the AMEX or in privately-negotiated
         transactions; the Company shall make such filing within 30 days after
         the expiration of the twenty-one day period, provided however, that if
         the twenty-first day is on or after February 13, 2003, the Company
         shall file the Additional Share Registration Statement within ten (10)
         business days after the filing of the Company's Form 10-K for its
         fiscal year ending December 31, 2002. At the end of the business day
         of the Registration Rights Deadline all registration rights with
         respect to any unexercised Additional Shares Right shall terminate.

                            (b)     use its best efforts, subject to receipt
of necessary information from the Investors after prompt request from the
Company to the Investors to provide such information, to cause the Registration
Statement or Additional Shares Registration Statement, as the case may be, to
become effective as soon as practicable, but in no event later than the earlier
of (a) the 120th day following the Closing Date and (b) the fifth trading day
following the date on which the Company is notified by the SEC that such
Registration Statement will not be reviewed or is no longer subject to further
review and comments, such efforts to include, without limiting the generality
of the foregoing, preparing and filing with the SEC as soon as practicable any
financial statements that are required to be filed prior to the effectiveness
of such Registration Statement or Additional Shares Registration Statement, as
the case may be;

                            (c)     prepare and file with the SEC such
amendments and supplements to the Registration Statement or Additional Shares
Registration Statement, as the case may be, and the Prospectus used in
connection therewith as may be necessary to keep the Registration Statement or
Additional Shares Registration Statement, as the case may be, current,
effective and free from any material misstatement or omission to state a
material fact until the earlier of, with respect to the (i) Registration
Statement, (A) the second anniversary of the Closing Date, as extended by the
length of any Suspension (as defined below); and (B) such time as all Preferred
Conversion Shares, Common Shares and Warrant Common Stock Shares purchased by
such Investor in this Offering have been sold pursuant to a registration
statement; and (ii) with respect to the Additional Shares Registration
Statement, (A) the second anniversary of the Registration Rights Deadline as
extended by the length of any Suspension (as defined below); and (B) such time
as all Right Conversion Shares have been sold pursuant to a registration
statement.

                           (d)     furnish to the Investor with respect to the
Preferred Conversion Shares, Common Shares and Warrant Common Stock Shares
registered under the Registration Statement, or the Right Conversion Shares
registered under the Additional Shares Registration Statement, as the case may
be, such number of copies of the Registration Statement, or Additional Shares
Registration Statement, as the case may be, and Prospectuses and Preliminary
Prospectuses with respect thereto in conformity with the requirements of the
Securities Act and such other documents as the Investor may reasonably request,
in order to facilitate the public sale or other disposition of all or any of
the Preferred Conversion Shares, Common Shares and Warrant Common Stock Shares,
or the Right Conversion Shares, as the case may be, by the Investor; provided,
however, that the obligation of the Company to deliver copies of Prospectuses
or Preliminary Prospectuses to the Investor shall be subject to the receipt by
the Company of reasonable assurances from the Investor that the Investor will
comply with the applicable provisions of the Securities Act and of such other
securities or blue sky laws as may be applicable in connection with any use of
such Prospectuses or Preliminary Prospectuses;

                            (e)     file documents required of the Company for
normal blue sky clearance in states specified in writing by the Investor and
use its best efforts to maintain such blue sky qualifications during the period
the Company is required to maintain the effectiveness of the Registration
Statement or Additional Shares Registration Statement, as the case may be,
pursuant to Section 7.1(c); provided, however, that the Company shall

                                      13

<PAGE>

not be required to qualify to do business or consent to general jurisdiction
in any jurisdiction in which it is not now so qualified or has not so consented;

                            (f)     bear all expenses incurred by the
Company in connection with the procedures in paragraph (a) through (e) of this
Section 8.1 and the registration of the Preferred Conversion Shares, Common
Shares and the Warrant Common Stock Shares pursuant to the Registration
Statement, or Right Conversion Shares pursuant to the Additional Shares
Registration Statement, as the case may be, including up to $15,000 in fees for
a single counsel representing all of the Investors for each of the Registration
Statement and the Additional Shares Registration Statement;

                            (g)     advise the Investor, promptly after it
 shall receive notice or obtain knowledge of the issuance of any stop order by
the SEC delaying or suspending the effectiveness of the Registration Statement
or Additional Shares Registration Statement, as the case may be, or of the
initiation or threat of any proceeding for that purpose; and it will promptly
use its best efforts to prevent the issuance of any stop order or to obtain its
withdrawal at the earliest possible moment if such stop order should be issued;

                            (h)     file a listing for additional shares with
AMEX; and

                            (i)     In the event that (1) the Company does
not file the Registration Statement with the SEC within thirty (30) days after
the Closing Date (the "Filing Deadline Date") or (2) if the Registration
Statement is not declared effective by the SEC by the earlier of the 120th day
after the Closing Date and the 5th day following the date on which the Company
is notified by the SEC that such Registration Statement will not be reviewed or
is no longer subject to further review (such date, the "Effective Deadline
Date"), the Company shall pay to the Investor, as liquidated damages and not as
a penalty, an amount in cash equal to one percent (1%) of the total price paid
to the Company on the Closing Date by such Investor pursuant to this Agreement.
Such amount shall be paid (i) on the third (3rd) business day immediately
following the Filing Deadline Date and on each monthly anniversary of the
Filing Deadline Date until such time as the Registration Statement is filed,
and (ii) on the third (3rd) business day following the Effective Deadline Date
and on each monthly anniversary of the Effective Deadline Date until such time
as the Registration Statement is declared effective, in each case prorated for
partial months.

         Notwithstanding anything to the contrary herein, (i) the Registration
Statement shall cover only (A) the Preferred Conversion Shares, Common Shares
and Warrant Common Stock Shares, and (B) not more than 757,500 shares of Common
Stock on behalf of other selling stockholders pursuant to registration
obligations of the Company; and (ii) the Additional Registration Statement shall
cover only the Right Conversion Shares. In no event at any time before the
Registration Statement becomes effective with respect to the Preferred
Conversion Shares, Common Shares, and Warrant Common Stock Shares, or the or
Additional Shares Registration Statement becomes effective with respect to the
Right Conversion Shares, as the case may be, shall the Company publicly announce
or file any other registration statement, other than registrations on Form S-8
and shall not effect or commence any sale of securities pursuant to such shelf
registration statement, without, with respect to the Registration Statement, the
prior written consent of a majority in interest of the Investors and, with
respect to the Additional Registration Statement, the prior written consent of
the Investors purchasing Preferred Shares.

         The Company understands that the Investor disclaims being an
underwriter, but the Investor being deemed an underwriter by the SEC shall not
relieve the Company of any obligations it has hereunder.

                  8.2      Transfer of Shares After Registration; Suspension.
                           -------------------------------------------------

                            (a)     The Investor agrees that it will not
effect any disposition of the Preferred Conversion Shares, Common Shares,
Warrant Common Stock Shares and Right Conversion Shares or its right to
purchase the Preferred Conversion Shares, Common Shares, Warrant Common Stock
Shares and Right Conversion Shares that would constitute a sale within the
meaning of the Securities Act except as contemplated in the Registration
Statement referred to in Section 7.1 as described below or as otherwise
permitted by law, and that it will promptly notify the Company of any changes
in the information set forth in the Registration Statement or Additional Shares
Registration Statement, as the case may be, regarding the Investor or its plan
of distribution.

                                      14

<PAGE>

                            (b)     Except in the event that paragraph (c)
below applies, the Company shall (i) if deemed necessary by the Company,
prepare and file from time to time with the SEC a post-effective amendment to
the Registration Statement or Additional Shares Registration Statement, as the
case may be, or a supplement to the related Prospectus or a supplement or
amendment to any document incorporated therein by reference or file any other
required document so that such Registration Statement or Additional Shares
Registration Statement, as the case may be, will not contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading, and
so that, as thereafter delivered to purchasers of the Preferred Conversion
Shares, Common Shares, Warrant Common Stock Shares or Right Conversion Shares
being sold thereunder, such Prospectus will not contain an untrue statement of
a material fact or omit to state a material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading; (ii) provide to Investor drafts of
any documents to be filed pursuant to 8.2(b)(i) for the Investor's review at
least two (2) business days prior to the filing of such documents; (iii)
provide the Investor copies of any documents filed pursuant to Section
8.2(b)(i); and (iv) inform each Investor that the Company has complied with its
obligations in Section 8.2(b)(i) (or that, if the Company has filed a
post-effective amendment to the Registration Statement or Additional Shares
Registration Statement, as the case may be, which has not yet been declared
effective, the Company will notify the Investor to that effect, will use its
best efforts to secure the effectiveness of such post-effective amendment as
promptly as possible and will promptly notify the Investor pursuant to Section
8.2(b)(i) hereof when the amendment has become effective).

                            (c)     Subject to paragraph (d) below, in the
 event (i) of any request by the SEC or any other federal or state governmental
authority during the period of effectiveness of the Registration Statement or
Additional Shares Registration Statement, as the case may be, for amendments or
supplements to a Registration Statement or Additional Shares Registration
Statement, as the case may be, or related Prospectus or for additional
information; (ii) of the issuance by the SEC or any other federal or state
governmental authority of any stop order suspending the effectiveness of a
Registration Statement or Additional Shares Registration Statement, as the case
may be, or the initiation of any proceedings for that purpose; (iii) of the
receipt by the Company of any notification with respect to the suspension of
the qualification or exemption from qualification of any of the Preferred
Conversion Shares, Common Shares, Right Conversion Shares, and Warrant Common
Stock Shares for sale in any jurisdiction or the initiation or threatening of
any proceeding for such purpose; or (iv) of any event or circumstance which,
upon the advice of its counsel, necessitates the making of any changes in the
Registration Statement or Additional Shares Registration Statement, as the case
may be, or Prospectus related thereto, or any document incorporated or deemed
to be incorporated therein by reference, so that, in the case of the
Registration Statement or Additional Shares Registration Statement, as the case
may be, it will not contain any untrue statement of a material fact or any
omission to state a material fact required to be stated therein or necessary to
make the statements therein not misleading, and that in the case of the
Prospectus related thereto, it will not contain any untrue statement of a
material fact or any omission to state a material fact required to be stated
therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; then the Company
shall deliver a certificate in writing to the Investor (the "Suspension
Notice") to the effect of the foregoing and, upon receipt of such Suspension
Notice, the Investor will refrain from selling any shares of Common Stock
pursuant to the Registration Statement or Additional Shares Registration
Statement, as the case may be, (a "Suspension") until the Investor's receipt of
copies of a supplemented or amended Prospectus prepared and filed by the
Company, or until it is advised in writing by the Company that the current
Prospectus may be used, and has received copies of any additional or
supplemental filings that are incorporated or deemed incorporated by reference
in any such Prospectus. In the event of any Suspension, the Company will use
its best efforts to cause the use of the Prospectus so suspended to be resumed
within thirty (30) days after the delivery of a Suspension Notice to the
Investor. In addition to and without limiting any other remedies (including,
without limitation, at law or at equity) available to the Investor, the
Investor shall be entitled to specific performance in the event that the
Company fails to comply with the provisions of this Section 8.2(c).

                            (d)     Notwithstanding the Sections 8.2(a)-(c)
and 8.2(e), the Investor shall not be prohibited from selling Preferred
Conversion Shares, Common Shares and Warrant Common Stock Shares under the
Registration Statement or the Right Conversion Shares under the Additional
Shares Registration Statement, as the case may be, as a result of Suspensions
on more than two occasions of not more than thirty (30) days each in any twelve
month period, unless, in the good faith judgment of the Company's Board of
Directors, upon the written advice of counsel, the sale of Preferred Conversion
Shares, Common Shares and Warrant Common Stock Shares under the Registration
Statement or Right Conversion Shares under the Additional Shares Registration
Statement, as

                                      15

<PAGE>

the case may be, in reliance on this paragraph 8.2(d) would be reasonably
likely to cause a violation of the Securities Act or the Exchange Act and
result in potential liability to the Company; provided, however, any Suspension
that exceeds thirty (30) days shall require the Company to pay to the Investor
liquidated damages for the time periods in excess of such thirty (30) day
limits in a monthly cash amount equal to one percent (1%) of the total price
paid to the Company on the Closing Date by such Investor pursuant to this
Agreement until such time as any Suspension that exceeds such thirty (30) day
limit has been lifted (prorated for partial months).

                            (e)     Provided that a Suspension is not then in
effect, the Investor may sell Preferred Conversion Shares, Common Shares and
Warrant Common Stock Shares under the Registration Statement or Right
Conversion Shares under the Additional Shares Registration Statement, as the
case may be, in the manner set forth under the caption "Plan of Distribution"
in the related Prospectus, provided that it arranges for delivery of a current
Prospectus to the transferee of such Preferred Conversion Shares, Common Shares
and Warrant Common Stock Shares, or Right Conversion Shares. Upon receipt of a
request therefor, the Company has agreed to provide an adequate number of
current Prospectuses to the Investor and to supply copies to any other parties
requiring such Prospectuses.

                            (f)     In the event of a sale of Preferred
Conversion Shares, Common Shares or Warrant Common Stock Shares by the Investor
pursuant to the Registration Statement or Right Conversion Shares pursuant to
the Additional Shares Registration Statement, the Investor must also deliver to
the Company's transfer agent, with a copy to the Company, a Certificate of
Subsequent Sale substantially in the form attached hereto as Exhibit A, so that
                                                             ---------
the shares may be properly transferred.

                  8.3      Indemnification. For the purpose of this Section 8.3:
                           ---------------

                  (i)      the term "Selling Stockholder" shall include the
Investor, and each director, officer, employee, agent and controlling person of
the Investor;

                  (ii)     the term "Registration Statement" shall include the
Prospectus in the form first filed with the SEC pursuant to Rule 424(b) of the
Securities Act or filed as part of the Registration Statement at the time of
effectiveness if no Rule 424(b) filing is required, and any exhibit, supplement
or amendment included in or relating to the Registration Statement referred to
in Section 8.1;

                  (iii)    the term "Additional Shares Registration Statement"
shall include the Prospectus in the form first filed with the SEC pursuant to
Rule 424(b) of the Securities Act or filed as part of the Additional Shares
Registration Statement at the time of effectiveness if no Rule 424(b) filing is
required, and any exhibit, supplement or amendment included in or relating to
the Additional Registration Statement referred to in Section 8.1; and

                  (iv)     the term "untrue statement" shall mean any untrue
statement or alleged untrue statement, or any omission or alleged omission to
state in the Registration Statement or Additional Shares Registration Statement,
as the case may be, at the time it or any amendment to it becomes effective, a
material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading.

                            (a)     The Company agrees to indemnify and
hold harmless each Selling Stockholder from and against any losses, claims,
damages or liabilities to which such Selling Stockholder may become subject
(under the Securities Act or otherwise) insofar as such losses, claims, damages
or liabilities (or actions or proceedings in respect thereof) arise out of, or
are based upon (i) any breach of the representations or warranties of the
Company contained herein, or failure to comply with the covenants and
agreements of the Company contained herein, (ii) any untrue statement, or (iii)
any failure by the Company to fulfill any undertaking included in the
Registration Statement or Additional Shares Registration Statement, as the case
may be, as amended at the time of effectiveness, and the Company will reimburse
such Selling Stockholder for any reasonable legal or other expenses reasonably
incurred in investigating, defending or preparing to defend any such action,
proceeding or claim, or preparing to defend any such action, proceeding or
claim, provided, however, that the Company shall not be liable in any such case
       --------  -------
to the extent that such loss, claim, damage or liability arises out of, or is
based upon, an untrue statement made in such Registration Statement or
Additional Shares Registration Statement, as the case may be, or any omission
of a material fact required to be stated therein or necessary to make the
statements therein not

                                      16

<PAGE>

misleading in reliance upon and in conformity with written information
furnished to the Company by or on behalf of such Selling Stockholder
specifically for use in preparation of the Registration Statement or Additional
Shares Registration Statement, as the case may be, or the failure of such
Selling Stockholder to comply with its covenants and agreements contained in
Section 8.2 hereof respecting sale of the Common Stock or any statement or
omission in any Prospectus that is corrected in any subsequent Prospectus that
was delivered to the Selling Stockholder at least twenty-four hours prior to
the pertinent sale or sales by the Selling Stockholder.

                            (b)     The Investor agrees to indemnify and hold
harmless the Company (and each person, if any, who controls the Company within
the meaning of Section 15 of the Securities Act, each officer of the Company
who signs the Registration Statement or Additional Shares Registration
Statement, as the case may be, and each director of the Company) from and
against any losses, claims, damages or liabilities to which the Company (or any
such officer, director or controlling person) may become subject (under the
Securities Act or otherwise), insofar as such losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) arise out of, or are
based upon, (i) any failure by such Investor to comply with the covenants and
agreements contained in Section 8.2 hereof respecting sale of the Common Stock,
or (ii) any untrue statement of a material fact contained in the Registration
Statement or Additional Shares Registration Statement, as the case may be, or
any omission of a material fact required to be stated therein or necessary to
make the statements therein not misleading if such untrue statement or omission
was made in reliance upon and in conformity with written information furnished
by or on behalf of the Investor specifically for use in preparation of the
Registration Statement or Additional Shares Registration Statement, as the case
may be, and the Investor will reimburse the Company (or such officer, director
or controlling person), as the case may be, for any legal or other expenses
reasonably incurred in investigating, defending or preparing to defend any such
action, proceeding or claim.

                            (c)     Promptly after receipt by any indemnified
person of a notice of a claim or the beginning of any action in respect of
which indemnity is to be sought against an indemnifying person pursuant to this
Section 8.3, such indemnified person shall notify the indemnifying person in
writing of such claim or of the commencement of such action, but the omission
to so notify the indemnifying person will not relieve it from any liability
which it may have to any indemnified person under this Section 8.3 (except to
the extent that such omission materially and adversely affects the indemnifying
person's ability to defend such action) or from any liability otherwise than
under this Section 8.3. Subject to the provisions hereinafter stated, in case
any such action shall be brought against an indemnified person, the
indemnifying person shall be entitled to participate therein, and, to the
extent that it shall elect by written notice delivered to the indemnified
person promptly after receiving the aforesaid notice from such indemnified
person, shall be entitled to assume the defense thereof, with counsel
reasonably satisfactory to such indemnified person. After notice from the
indemnifying person to such indemnified person of its election to assume the
defense thereof, such indemnifying person shall not be liable to such
indemnified person for any legal expenses subsequently incurred by such
indemnified person in connection with the defense thereof, provided, however,
                                                           --------  -------
that if there exists or shall exist a conflict of interest that would make it
inappropriate, in the opinion of counsel to the indemnified person, for the
same counsel to represent both the indemnified person and such indemnifying
person or any affiliate or associate thereof, the indemnified person shall be
entitled to retain its own counsel at the expense of such indemnifying person;
provided, however, that no indemnifying person shall be responsible for the
fees and expenses of more than one separate counsel (together with appropriate
local counsel) for all indemnified parties. In no event shall any indemnifying
person be liable in respect of any amounts paid in settlement of any action
unless the indemnifying person shall have approved in advance the terms of such
settlement; provided that such consent shall not be unreasonably withheld. No
            --------
indemnifying person shall, without the prior written consent of the indemnified
person, effect any settlement of any pending or threatened proceeding in
respect of which any indemnified person is or could have been a party and
indemnification could have been sought hereunder by such indemnified person,
unless such settlement includes an unconditional release of such indemnified
person from all liability on claims that are the subject matter of such
proceeding.

                            (d)     If the indemnification provided for in this
Section 8.3 is unavailable to or insufficient to hold harmless an indemnified
person under subsection (a) or (b) above in respect of any losses, claims,
damages or liabilities (or actions or proceedings in respect thereof) referred
to therein, then each indemnifying person shall contribute to the amount paid
or payable by such indemnified person as a result of such losses, claims,
damages or liabilities (or actions in respect thereof) in such proportion as is
appropriate to reflect the relative fault of the Company on the one hand and
the Investor, as well as any other Selling Shareholders under such registration
statement on the other in connection with the statements or omissions or other
matters which resulted in

                                      17

<PAGE>

such losses, claims, damages or liabilities (or actions in respect thereof), as
well as any other relevant equitable considerations. The relative fault shall be
determined by reference to, among other things, in the case of an untrue
statement, whether the untrue statement relates to information supplied by the
Company on the one hand or an Investor or other Selling Shareholder on the other
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such untrue statement. The Company and the
Investor agree that it would not be just and equitable if contribution pursuant
to this subsection (d) were determined by pro rata allocation (even if the
Investor and other Selling Shareholders were treated as one entity for such
purpose) or by any other method of allocation which does not take into account
the equitable considerations referred to above in this subsection (d).
Notwithstanding the provisions of this subsection (d), the Investor shall not be
required to contribute any amount in excess of the amount by which the net
amount received by the Investor from the sale of the Preferred Conversion
Shares, Common Shares, Right Conversion Shares, Warrant Common Stock Shares and
Right Conversion Shares to which such loss relates exceeds the amount of any
damages which such Investor has otherwise been required to pay by reason of such
untrue statement. No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Investor's obligations in this subsection to contribute
shall be in proportion to its sale of Conversion Shares, Common Shares, Right
Conversion Shares, Warrant Common Stock Shares and Right Conversion Shares to
which such loss relates and shall not be joint with any other Selling
Shareholders. In no event shall the Investor be liable for any obligations,
contributions or indemnity of any of the Other Investors and any liability of
the Investor shall be several, and not joint, with respect to this Agreement.

                            (e)     The parties to this Agreement hereby
acknowledge that they are sophisticated business persons who were represented
by counsel during the negotiations regarding the provisions hereof including,
without limitation, the provisions of this Section 8.3, and are fully informed
regarding said provisions. They further acknowledge that the provisions of this
Section 8.3 fairly allocate the risks in light of the ability of the parties to
investigate the Company and its business in order to assure that adequate
disclosure is made in the Registration Statement or Additional Shares
Registration Statement, as the case may be, as required by the Act and the
Exchange Act.

                  8.4      Termination of Conditions and Obligations. The
                           -----------------------------------------
conditions precedent imposed by Section 6 or this Section 8 upon the
transferability of the Preferred Shares, Common Shares, Right Conversion Shares
and Warrant Common Stock Shares shall cease and terminate as to any particular
number of the Preferred Shares, Common Shares, Right Conversion Shares and
Warrant Common Stock Shares when such Preferred Conversion Shares, Common
Shares, Right Conversion Shares or Warrant Common Stock Shares shall have been
effectively registered under the Securities Act and sold or otherwise disposed
of in accordance with the intended method of disposition set forth in a
Registration Statement or Additional Shares Registration Statement, as the case
may be, covering such Preferred Conversion Shares, Common Shares, Warrant
Common Stock Shares and Right Conversion Shares or at such time as an opinion
of counsel reasonably satisfactory to the Company shall have been rendered to
the effect that such securities may be sold under Rule 144 or under another
exemption from registration under the Securities Act.

                  8.5      Information Available. So long as the Registration
                           ---------------------
Statement or Additional Shares Registration Statement, as the case may be, is
effective covering the resale of Conversion Shares, Preferred Common Shares,
Warrant Common Stock Shares and Right Conversion Shares owned by the Investor,
the Company will furnish to the Investor:

                            (a)     as soon as practicable after it is
available, one copy of (i) its Annual Report to Stockholders (which Annual
Report shall contain financial statements audited in accordance with generally
accepted accounting principles by a national firm of certified public
accountants), (ii) its Annual Report on Form 10-K, (iii) its Quarterly Reports
on Form 10-Q (the foregoing, in each case, excluding exhibits), and (iv)
reports on Form 8-K.

                            (b)     upon the request of the Investor, all
exhibits excluded by the parenthetical to subparagraph (a) of this Section 8.5
as filed with the SEC and all other information that is made available to
shareholders; and

                                      18

<PAGE>

                            (c)     upon the reasonable request of the Investor,
 an adequate number of copies of the Prospectuses to supply to any other party
requiring such Prospectuses.

         9.       Expenses. The Company shall pay at closing the reasonable
                  --------
documented legal fees and expenses of one counsel for the Investors purchasing
Preferred Shares in connection with the preparation and negotiation of the
Stock Purchase Agreement and other agreements contemplated hereby and the
closing of the transactions contemplated hereby, up to a maximum of $25,000.

         10.      Reporting Status. The Company shall timely file all reports
                  ----------------
required to be filed with the SEC pursuant to Section 13 or 15(d) of the
Exchange Act and shall not terminate its status as an issuer required to file
reports under the Exchange Act even if the Exchange Act or the rules and
regulations thereunder would permit such termination.

         11.      Continuing Listing Obligations. The Company acknowledges and
                  ------------------------------
agrees that it is critically important to the Investor that the Company
maintains, without suspension, the listing of its common stock on the AMEX. The
Company hereby agrees that, from the Closing and for so long as the
Registration Statement and Additional Shares Registration Statement are, or are
required to be, valid and effective pursuant to Section 8 of this Agreement,
the Company shall use its reasonable best efforts to maintain the valid and
unsuspended listing of its common stock on AMEX.

         12.      Notices. All notices, requests, consents and other
                  -------
communications hereunder shall be in writing, shall be mailed (A) if within the
United States by first-class registered or certified airmail, or nationally
recognized overnight express courier, postage prepaid, or by facsimile, or (B)
if delivered from outside the United States, by International Federal Express
or facsimile, and shall be deemed given (i) if delivered by first-class
registered or certified mail, three business days after so mailed, (ii) if
delivered by nationally recognized overnight carrier, one business day after so
mailed, (iii) if delivered by International Federal Express, two business days
after so mailed, (iv) if delivered by facsimile, upon electronic confirmation
of receipt and shall be delivered as addressed as follows:

                  (a)      if to the Company, to:

                                    Organogenesis Inc.
                                    150 Dan Road
                                    Canton, Massachusetts 02021
                                    Attn: John Arcari
                                    Phone:  (781) 575-0775
                                    Fax:  (781) 575-1570

                  (b)      with a copy to:

                                    Mintz, Levin, Cohn, Ferris, Glovsky and
                                    Popeo, P.C.
                                    One Financial Center
                                    Boston, Massachusetts 02111
                                    Attn: Neil H. Aronson, Esq.
                                    Phone: (617) 542-6000
                                    Fax: (617) 542-2241

                  (c)      if to the Investor, at its address on the signature
                           page hereto, or at such other address or addresses as
                           may have been furnished to the Company in writing and
                           in the case of Preferred Shares Investors, copied to:

                                    Heller, Ehrman, White & McAuliffe, LLP
                                    333 Bush Street
                                    San Francisco, CA  94104
                                    Attn:  Randall B. Schai
                                    Phone: (415) 772-6970
                                    Fax: (415) 772-6268

                                      19

<PAGE>

Notwithstanding anything in this Section 12 to the contrary, the Company may
e-mail the documents required in Section 8.5 to the e-mail address set forth on
the signature page hereto.

         13.      Changes. This Agreement may not be modified or amended except
                  -------
pursuant to an instrument in writing signed by the Company and the Investor.

         14.      Headings. The headings of the various sections of this
                  --------
Agreement have been inserted for convenience of reference only and shall not be
deemed to be part of this Agreement.

         15.      Severability. In case any provision contained in this
                  ------------
Agreement should be invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein shall not in any way be affected or impaired thereby.

         16.      Governing Law. This Agreement shall be governed by, and
                  --------------
construed in accordance with, the internal laws of the State of Delaware,
without giving effect to the principles of conflicts of law.

         17.      Counterparts. This Agreement may be executed in two or more
                  ------------
counterparts, each of which shall constitute an original, but all of which, when
taken together, shall constitute but one instrument, and shall become effective
when one or more counterparts have been signed by each party hereto and
delivered to the other parties. Any counterpart or other signature delivered by
facsimile shall be deemed for all purposes as being good and valid execution and
delivery of this Agreement by such party.

         18.      Rule 144. The Company covenants that it will timely file the
                  --------
reports required to be filed by it under the Securities Act and the Exchange Act
and the rules and regulations adopted by the SEC thereunder (or, if the Company
is not required to file such reports, it will, upon the request of any Investor
holding Preferred Shares, Conversion Shares, Common Stock, Right Conversion
Shares or Warrant Common Stock Shares purchased hereunder made after the first
anniversary of the Closing Date, make publicly available such information as
necessary to permit sales pursuant to Rule 144 under the Securities Act), and it
will take such further action as any such Investor may reasonably request, all
to the extent required from time to time to enable such Investor to sell
Preferred Shares, Preferred Conversion Shares, Common Stock, Right Conversion
Shares or Warrant Common Stock Shares purchased hereunder without registration
under the Securities Act within the limitation of the exemptions provided by (a)
Rule 144 under the Securities Act, as such Rule may be amended from time to
time, or (b) any similar rule or regulation hereafter adopted by the SEC. Upon
the request of the Investor, the Company will deliver to such holder a written
statement as to whether it has complied with such information and requirements.

         19.      Confidential Information. The Investor covenants that from the
                  ------------------------
Closing Date until the Company issues a current report on Form 8-K, as set forth
below, it will maintain in confidence the Memorandum and the existence and terms
and conditions of the Agreements unless such information (a) becomes generally
publicly available other than through a violation of this provision by the
Investor or its agents or (b) is required to be disclosed in legal proceedings
(such as by deposition, interrogatory, request for documents, subpoena, civil
investigation demand, filing with any governmental authority or similar
process); provided, however, that before making any disclosure in reliance on
this Section 19, the Investor will give the Company at least 15 days prior
written notice (or such shorter period as required by law) specifying the
circumstances giving rise thereto and will furnish only that portion of the
non-public information which is legally required and will exercise its best
efforts to obtain reliable assurance that confidential treatment will be
accorded any non-public information so furnished. The Company agrees to publicly
disclose the existence of the Agreements and all material terms thereof within
two (2) business days after the Closing pursuant to the filing of a current
report on Form 8-K.

         20.      Scope of Representation. Investors purchasing Common Shares
                  -----------------------
and Common Share Warrants pursuant to this Agreement acknowledge and agree
that (a) the law firm of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.
solely represents the Company in the transactions contemplated by this
Agreement and (b) the law firm of Heller Ehrman White & McAuliffe LLP solely
represents the Investors purchasing Preferred Shares in the transaction
contemplated by this Agreement. All other Investors further acknowledge and
agree that (x) they have been advised that the Agreement and related documents
contain significant legal terms that will be binding upon them, (y) they have
been advised of the importance of obtaining independent legal review of the
same, and (z) they

                                      20

<PAGE>

have been given opportunity to obtain such review.

<PAGE>

                                  Schedule 2.2
                                  ------------

<TABLE>
<CAPTION>

                               List of Purchasers

Investor's Name (as it should   # of Shares   Warrants      Aggregate    # of Shares of     Aggregate    Additional   Consideration
      appear on all               of Common     to       Purchase Price     Series D         Purchase      Shares
    certificates) and              Stock @    Purchase     of Common       Convertible       Price of      Right
    Contact Information         $1.45/share     # of       Stock and     Preferred Stock    Preferred
                                              Shares of     Warrants       @ $65/share       Stock
                                               Common
                                               Stock
<S>                                           <C>                  <C>              <C>             <C>
Bricoleur Partners, LP                                                            19,815   $1,287,975.00      3,963     $257,595.00
12230 El Camino Real, Suite 100
San Diego, CA 92130

Bricoleur Partners II, LP                                                         25,715   $1,671,475.00      5,143     $334,295.00
12230 El Camino Real, Suite 100
San Diego, CA 92130

Bricoleur Enhanced, LP                                                            17,110   $1,112,150.00      3,422     $222,430.00
12230 El Camino Real, Suite 100
San Diego, CA 92130

Bric6, LP                                                                         13,225     $859,625.00      2,645     $171,925.00
12230 El Camino Real, Suite 100
San Diego, CA 92130

Bricoleur Offshore, Ltd                                                           22,560   $1,466,400.00      4,512     $293,280.00
12230 El Camino Real, Suite 100
San Diego, CA 92130

Bricoleur-Plus Fund, LTD                                                             930      $60,450.00        186      $12,090.00
12230 El Camino Real, Suite 100
San Diego, CA 92130
</TABLE>

<PAGE>

<TABLE>
<S>                                             <C>             <C>        <C>              <C>   <C>            <C>     <C>

                                                                                            645   $41,925.00     129     $8,385.00
Bric Healthcare, LP
12230 El Camino Real, Suite 100
San Diego, CA 92130

Capital Ventures International                   1,034,482      517,241    $1,499,998.90
401 City Avenue, Suite 220
Bala Cynwyd, PA 19004-1188                                .

EGM Medical Technology Fund LP                     371,425      185,712      $538,566.25
One Embarcadero Ctr., Suite 2410
San Francisco, CA 94111

EGM Medical Technology Offshore Fund               214,781      107,390      $311,432.45
One Embarcadero Ctr., Suite 2410
San Francisco, CA 94111

Strong River Investments, Inc.                     689,655      344,827      $999,999.75
C/o Cavallo Capital Corp.
660 Madison Avenue,
18th Floor
New York, NY 10021

Kahn Capital Partners LP                         1,724,137      862,069    $2,499,998.65
5506 Worsham Court
Windermere, FL 34786

Peter and Carolyn Lynch                             96,551       48,275      $139,998.95
JT Ten
82 Devonshire S8A
Boston, MA 02109
(617) 563-8489

Peter Lynch Foundation                             103,310       51,655      $149,799.50
82 Devonshire S8A
Boston, MA 02109
</TABLE>

<PAGE>
<TABLE>
<S>                                                 <C>          <C>          <C>
Peter S Lynch Charitable Remainder Trust            43,000       21,500        $62,350.00
82 Devonshire S8A
Boston, MA 02109

Lynch Children's Trust                              11,000        5,500        $15,950.00
fbo Elizabeth Lynch
82 Devonshire S8A
Boston, MA 02109

Lynch Children's Trust                              11,000        5,500        $15,950.00
fbo Mary Lynch
82 Devonshire S8A
Boston, MA 02109

Lynch Children's Trust                              11,000        5,500        $15,950.00
fbo Anne Lynch
82 Devonshire S8A
Boston, MA 02109

MRT, LP                                            344,828      172,414       $500,000.60
Ian M. Estepan
120 Broadway
Suite 1050
New York, NY 10271

SF Capital Partners                              1,034,482      517,241     $1,499,999.15
505 Montgomery St., 10th floor
San Francisco, CA 94111

Stonestreet Limited Partnership                    344,828      172,414       $500,000.60
c/o Trinity Capital Advisors
601 Montgomery Street
Suite 1060
San Francisco, CA
</TABLE>

<PAGE>

<TABLE>
<S>                                           <C>         <C>         <C>             <C>      <C>            <C>     <C>
Vertical Ventures Investments, LLC              517,241     258,620     $749,999.45
900 Third Avenue
New York, NY 10022

ZLP Master Technology Fund Ltd.                 689,656     344,828   $1,000,001.20
45 Broadway, 28th Floor
New York, NY 10006

Total                                         7,241,376   3,620,686  $10,499,995.45   100,000  $6,500,000.00  20,000  $1,300,000.00
</TABLE>

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