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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549


FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) November 13, 2002

MacroPore Biosurgery, Inc.
(Exact name of registrant as specified in charter)

Delaware
(State or other jurisdiction
of incorporation)		   0-32501
(Commission
File Number)		   33-0827593
(IRS Employer
Identification No.)


6740 Top Gun Street, San Diego, California
 
92121
(Address of principal executive offices)   (Zip Code)

Registrant's telephone number, including area code (858) 458-0900


Item 2. Acquisition or Disposition of Assets.

        (a)  On November 13 and 19, 2002, MacroPore Biosurgery, Inc., a Delaware corporation ("MacroPore"), and StemSource, Inc., a privately-held Delaware corporation ("StemSource"), completed a two-step reorganization transaction (the "Merger") pursuant to an Agreement and Plan of Reorganization dated as of October 9, 2002 (the "Merger Agreement") by and among MacroPore, MS Acquisition, Inc., a Delaware corporation and a wholly owned subsidiary of MacroPore ("Acquisition Sub"), and StemSource. The initial step of the reorganization transaction involved a merger of Acquisition Sub with and into StemSource, with StemSource continuing as the surviving corporation. This initial step was completed on November 13, 2002. The second step involved a statutory merger of StemSource with and into MacroPore, with MacroPore continuing as the surviving corporation. This second step was completed on November 19, 2002.

        On July 12, 2002, MacroPore loaned to StemSource the amount of $1,000,000 in cash (the "MacroPore Loan"), in exchange for which StemSource issued a convertible promissory note. In connection with the Merger, MacroPore has assumed the Loan.

        In contemplation of the closing of the Merger, MacroPore purchased from five separate StemSource stockholders an aggregate of 2,717,500 shares of StemSource Common Stock (the "MacroPore Purchases"). The consideration paid by MacroPore in connection with the MacroPore Purchases was an aggregate of $1,861,487 in cash. The source of these funds was MacroPore's working capital. In addition to the MacroPore Loan and the MacroPore Purchases, upon the closing of the Merger, MacroPore delivered to the StemSource stockholders 1,447,755 shares of MacroPore Common Stock in exchange for all the outstanding shares of StemSource Series A Preferred Stock and Common Stock that were not already owned by MacroPore.

        The amount of cash and stock issued by MacroPore in connection with the Merger was determined by arms length negotiations between MacroPore, StemSource and the StemSource stockholders. As a basis for such negotiations, MacroPore management reviewed StemSource's contracts, intellectual property, projections and other factors, such as anticipated synergy between the companies' services and products and anticipated consumer demand for the combined companies' products.

        Before the Merger and the MacroPore Purchases, MacroPore owned approximately 13.5% of the issued and outstanding capital stock of StemSource. In addition, Christopher J. Calhoun, a director of MacroPore and MacroPore's President and Chief Executive Officer, was a member of StemSource's Board of Directors through the closing of Merger (although Mr. Calhoun abstained from voting in such capacity with regard to the Merger Agreement and merger of Acquisition Sub with and into StemSource). Immediately before the closing of the Merger, and giving effect to the MacroPore Purchases, MacroPore owned approximately 38% of the issued and outstanding shares of StemSource capital stock. In connection with the Merger, Marc Hedrick, M.D. and Ronald Henriksen were elected to the Board of Directors of MacroPore, and Mr. Hedrick was also appointed as Chief Scientific Officer of MacroPore.

        MacroPore granted to StemSource stockholders who acquired at least 10,000 shares of MacroPore Common Stock in the Merger "piggy back" registration rights (subject to underwriter cut back) under the Securities Act of 1933, as amended, with respect to the shares of MacroPore Common Stock issued in the Merger, and such rights are exercisable in the event MacroPore registers MacroPore Common Stock on behalf of certain named founders of MacroPore.

        (b)  StemSource is engaged in research toward the development of therapies based on adult stem cells. MacroPore intends to continue to carry on the business heretofore conducted by StemSource and to use StemSource's plant, equipment and other physical property in the conduct of such business.

2



Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.

        (a)  Financial statements of business acquired.

        MacroPore will file with the Securities and Exchange Commission the financial statements of StemSource required under Item 7(a) of Form 8-K within the time period permitted by Item 7(a)(4) of Form 8-K for filing such information.

        (b)  Pro forma financial information.

        MacroPore will file with the Securities and Exchange Commission the financial statements of StemSource required under Item 7(b) of Form 8-K within the time period permitted by Item 7(a)(4) and Item 7(b)(2) of Form 8-K for filing such information.

        (c)  Exhibits

    2.1   Agreement and Plan of Reorganization, dated October 9, 2002, by and among MacroPore Biosurgery, Inc., StemSource, Inc. and MS Acquisition, Inc. (the "Merger Agreement"). Certain schedules and exhibits referenced in the Merger Agreement have been omitted in accordance with Item 601(b)(2) of Regulation S-K. A copy of any omitted schedule and/or exhibit will be furnished supplementally to the Securities and Exchange Commission upon request.

 
 
2.2
 
Amendment No. 1 to Agreement and Plan of Reorganization, dated November 4, 2002, by and among MacroPore Biosurgery, Inc., StemSource, Inc. and MS Acquisition, Inc.

 
 
10.1
 
Registration Rights Agreement, dated November 13, 2002, among MacroPore Biosurgery, Inc. and certain holders of shares of Common Stock of MacroPore Biosurgery, Inc. Certain schedules and exhibits referenced in the Registration Rights Agreement have been omitted in accordance with Item 601(b)(2) of Regulation S-K. A copy of any omitted schedule and/or exhibit will be furnished supplementally to the Securities and Exchange Commission upon request.

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SIGNATURES

        Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

    MACROPORE BIOSURGERY, INC.

Date: November 27, 2002
 
By:
/s/  CHRISTOPHER J. CALHOUN      
    Name: Christopher J. Calhoun
Title: President and Chief Executive Officer

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EXHIBIT INDEX

Exhibit
    

2.1
 
Agreement and Plan of Reorganization, dated October 9, 2002, by and among MacroPore Biosurgery, Inc., StemSource, Inc. and MS Acquisition, Inc. (the "Merger Agreement"). Certain schedules and exhibits referenced in the Merger Agreement have been omitted in accordance with Item 601(b)(2) of Regulation S-K. A copy of any omitted schedule and/or exhibit will be furnished supplementally to the Securities and Exchange Commission upon request.

2.2
 
Amendment No. 1 to Agreement and Plan of Reorganization, dated November 4, 2002, by and among MacroPore Biosurgery, Inc., StemSource, Inc. and MS Acquisition, Inc.

10.1
 
Registration Rights Agreement, dated November 13, 2002, among MacroPore Biosurgery, Inc. and certain holders of shares of Common Stock of MacroPore Biosurgery, Inc. Certain schedules and exhibits referenced in the Registration Rights Agreement have been omitted in accordance with Item 601(b)(2) of Regulation S-K. A copy of any omitted schedule and/or exhibit will be furnished supplementally to the Securities and Exchange Commission upon request.

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Exhibit 2.1

        AGREEMENT AND PLAN OF REORGANIZATION

by and among

MACROPORE BIOSURGERY, INC.

MS ACQUISITION, INC.

and

STEMSOURCE, INC.

dated October 9, 2002


TABLE OF CONTENTS

 
    
   Page
Article I Definitions   1
  1.1   Defined Terms.   1
  1.2   Construction of Certain Terms and Phrases.   6

Article II The Merger
 
6
  2.1   The Merger.   6
  2.2   Effective Time.   7
  2.3   Effect of the Merger.   7
  2.4   Certificate of Incorporation; Bylaws.   7
  2.5   Directors and Officers.   7
  2.6   Effect on Capital Stock/Merger Consideration.   7
  2.7   Dissenters' Rights.   8
  2.8   Exchange Procedure.   9
  2.9   Escrow Agreement and Stockholder Representative.   10
  2.10   Securities Laws Compliance.   10
  2.11   Closing.   10

Article III Representations and Warranties of StemSource
 
12
  3.1   Organization of StemSource.   12
  3.2   Capital Stock of StemSource.   12
  3.3   Ownership of Shares.   13
  3.4   Authority of StemSource.   13
  3.5   No Affiliates.   14
  3.6   No Conflicts.   14
  3.7   Consents and Governmental Approvals and Filings.   14
  3.8   Books and Records.   14
  3.9   StemSource Financial Statements.   14
  3.10   Absence of Changes.   14
  3.11   No Undisclosed Liabilities.   14
  3.12   Tangible Personal Property.   15
  3.13   Benefit Plans; ERISA.   15
  3.14   Real Property.   16
  3.15   Intellectual Property Rights.   16
  3.16   Proprietary Information of Third Parties.   18
  3.17   Litigation.   19
  3.18   Compliance with Law.   19
  3.19   Contracts.   19
  3.20   Environmental Matters.   20
  3.21   Insurance.   21
  3.22   Tax Matters.   21
  3.23   Labor and Employment Relations.   22
  3.24   Certain Employees.   23
  3.25   Absence of Certain Developments.   23
  3.26   Customers.   24
  3.27   Necessary Property.   24
  3.28   Bank Accounts.   24
  3.29   Permits.   24
  3.30   Third Party Consents.   24

i

  3.31   Brokers.   25
  3.32   Material Misstatements and Omissions.   25

Article IV Representations and Warranties of MacroPore and Acquisition Sub
 
25
  4.1   Organization.   25
  4.2   Capital Stock of MacroPore.   25
  4.3   Authority.   25
  4.4   Litigation.   26
  4.5   Reports and Financial Statements.   26
  4.6   Brokers.   26
  4.7   No Conflicts.   27
  4.8   Consents and Governmental Approvals and Filings.   27
  4.9   Ownership of Acquisition Sub; No Prior Activities.   27
  4.10   Additional Representations Relating to the Reorganization.   27
  4.11   Merger Shares.   27
  4.12   Material Misstatements and Omissions.   27

Article V Covenants
 
28
  5.1   Operation of Business Prior to Effective Time.   28
  5.2   No Solicitation or Negotiation.   30
  5.3   Access to Information.   30
  5.4   Public Announcements; StemSource Literature.   31
  5.5   Notification of Certain Matters.   31
  5.6   Fees and Expenses.   31
  5.7   Confidentiality.   32
  5.8   Approval of the StemSource Stockholders.   32
  5.9   StemSource Employee Plans and Benefit Arrangements.   32
  5.10   Tax-Free Reorganization.   32
  5.11   Necessary Consents.   33
  5.12   Litigation.   33
  5.13   Satisfaction of Conditions Precedent.   33
  5.14   Board Representation.   33
  5.15   No Warrant Exercise.   33

Article VI Conditions to Consummation of the Merger
 
33
  6.1   Conditions to Each Party's Obligations to Effect the Merger.   33
  6.2   Conditions to the Obligations of StemSource.   34
  6.3   Conditions to the Obligations of MacroPore and Acquisition Sub.   34

Article VII Termination; Amendment; Waiver
 
35
  7.1   Termination.   35
  7.2   Effect of Termination.   36
  7.3   Amendment.   36
  7.4   Extension; Waiver.   36

Article VIII Actions by the Parties After the Closing
 
37
  8.1   Survival of Representations, Warranties, Etc.   37
  8.2   Indemnification.   37
  8.3   Indemnity Escrow Account.   39
  8.4   Thousand Oaks Facility.   39
  8.5   Further Assurances.   39
  8.6   Reports Under Securities Exchange Act of 1934.   39

ii

  8.7   Listing of Merger Shares.   39
  8.8   Review of Stockholder Representative.   40
  8.9   Second Merger.   40

Article IX Miscellaneous
 
40
  9.1   Notices.   40
  9.2   Entire Agreement.   41
  9.3   No Third Party Beneficiary.   41
  9.4   No Assignment; Binding Effect.   41
  9.5   Headings.   41
  9.6   Severability.   41
  9.7   StemSource Disclosure Letter.   41
  9.8   Governing Law.   41
  9.9   Consent to Jurisdiction and Forum Selection.   41
  9.10   Construction.   42
  9.11   Counterparts.   42
  9.12   Advice of Counsel.   42

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EXHIBITS

Schedule A   —   Exchange Ratio Spreadsheet
Exhibit A   —   Merger Voting Agreement
Exhibit B   —   Certificate of Merger
Exhibit C   —   Certificate of Incorporation of Surviving Corporation
Exhibit D   —   Bylaws of Surviving Corporation
Exhibit E   —   Escrow Agreement
Exhibit F   —   Investment Representation Letter
Exhibit G   —   Non-Competition Agreement
Exhibit H   —   Estoppel Certificate
Exhibit I   —   StemSource Officer Certificate
Exhibit J   —   StemSource Secretary Certificate
Exhibit K   —   MacroPore Officer's Certificates
Exhibit L   —   MacroPore Secretary Certificates
Exhibit M   —   Acquisition Sub Officer's Certificate
Exhibit N   —   Acquisition Sub Secretary Certificate
Exhibit O   —   Registration Rights Agreement

iv


AGREEMENT AND PLAN OF REORGANIZATION

        This Agreement and Plan of Reorganization (this "Agreement") is made and entered into as of October 9, 2002, by and among MacroPore Biosurgery, Inc., a Delaware corporation ("MacroPore"), MS Acquisition, Inc., a Delaware corporation and a wholly-owned subsidiary of MacroPore ("Acquisition Sub"), and StemSource, Inc., a Delaware corporation ("StemSource"). MacroPore, Acquisition Sub and StemSource are collectively referred to herein as the "Parties."

RECITALS

        A.    Upon the terms and subject to the conditions of this Agreement and in accordance with the Delaware General Corporation Law (the "DGCL"), MacroPore and StemSource will enter into a business combination transaction pursuant to which Acquisition Sub will merge with and into StemSource (the "Merger") and as soon as practicable thereafter, StemSource will merge with and into MacroPore (the "Second Merger").

        B.    The Boards of Directors of each of MacroPore, Acquisition Sub and StemSource (i) have each determined that the Merger is consistent with and in furtherance of the long-term business strategy of their respective companies and fair, and in the best interests of, their respective companies and stockholders and (ii) have each approved this Agreement, the Merger and the other transactions (including the Second Merger) contemplated by this Agreement.

        C.    For federal income tax purposes, the Parties intend that (i) the Merger qualify as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended (the "Code"), and (ii) this Agreement be and is adopted as a plan of reorganization within the meaning of Section 368(a) of the Code.

        D.    Concurrently with the execution of this Agreement, and as a condition and inducement to MacroPore's willingness to enter into this Agreement, certain stockholders of StemSource shall each enter into a Merger Voting Agreement and Proxy in the form attached hereto as Exhibit A (the "Merger Voting Agreement").

        E.    MacroPore, Acquisition Sub and StemSource desire to make certain representations and warranties and other agreements in connection with the Merger.

        NOW, THEREFORE, in consideration of the premises and the mutual covenants and promises contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

ARTICLE I

DEFINITIONS

        1.1    Defined Terms.    As used in this Agreement, the following defined terms have the meanings indicated below:

        "Acquisition Sub" has the meaning set forth in the first paragraph of this Agreement.

        "Actions or Proceedings" means any action, suit, proceeding, arbitration, Order (as defined below), inquiry, hearing, assessment with respect to fines or penalties or other litigation (whether civil, criminal, administrative or investigative) commenced, brought, conducted or heard by or before, or otherwise involving, any Governmental or Regulatory Authority (as defined below).

        "Affiliate" means, with respect to any Person, another Person that directly, or indirectly through one or more intermediaries, controls, is controlled by or is under common control with such Person.

        "Agreement" has the meanings set forth in the first paragraph and in Section 2.2 of this Agreement.

        "Assets and Properties" and "Assets or Properties" of any Person each means all assets and properties of every kind, nature, character and description (whether real, personal or mixed, whether


tangible or intangible, whether absolute, accrued, contingent, fixed or otherwise and wherever situated), including the goodwill related thereto, operated, owned or leased by such Person, including, without limitation, cash, cash equivalents, accounts and notes receivable, chattel paper, documents, instruments, general intangibles, real estate, equipment, inventory, goods and Intellectual Property.

        "Benefit Plan" means any Plan established, arranged or maintained by StemSource or any corporate group of which StemSource is or was a member, existing at the Closing Date or prior thereto, to which StemSource contributes or has contributed, and under which any employee, officer, director or former employee, officer or director of StemSource or any beneficiary thereof is covered, is eligible for coverage or has benefit rights.

        "Books and Records" of any Person means all files, documents, instruments, papers, books, computer files (including but not limited to files stored on a computer's hard drive or on floppy disks), electronic files and records in any other medium relating to the business, operations or condition of such Person.

        "Business Day" means a day other than Saturday, Sunday or any day on which banks located in the State of California are authorized or obligated to close.

        "California Code" means the California Corporations Code.

        "Certificate of Merger" has the meaning set forth in Section 2.2.

        "Closing" has the meaning set forth in Section 2.11(a).

        "Closing Date" has the meaning set forth in Section 2.11(a).

        "Closing Anniversary Date" has the meaning set forth in Section 8.7.

        "Code" has the meaning set forth in Recital C of this Agreement.

        "Copyrights" has the meaning set forth in the definition of "Intellectual Property."

        "Damages" has the meaning set forth in Section 8.2(a).

        "Defined Benefit Plan" means each Benefit Plan which is subject to Part 3 of Title I of ERISA, Section 412 of the Code or Title IV of ERISA.

        "DGCL" has the meaning set forth in the Recital A of this Agreement.

        "Dissenting Shares" has the meaning set forth in Section 2.7.

        "Dissenting Stockholder" has the meaning set forth in Section 2.7.

        "Effective Time" has the meaning set forth in Section 2.2.

        "Encumbrances" means any mortgage, pledge, assessment, security interest, deed of trust, lease, lien, adverse claim, levy, charge or other encumbrance of any kind, or any conditional sale or title retention agreement or other agreement to give any of the foregoing in the future.

        "ERISA" means the Employee Retirement Income Security Act of 1974, as amended, and the Department of Treasury and Department of Labor regulations promulgated thereunder.

        "ERISA Affiliate" means any entity which is a member of a "controlled group of corporations" or which is or was under "common control" with StemSource as defined in Section 414 of the Code.

        "Escrow Agreement" has the meaning set forth in Section 2.9(a).

        "Escrow Period" has the meaning set forth in Section 8.3.

        "Escrow Shares" has the meaning set forth in Section 2.9(a).

2


        "Estoppel Certificate" has the meaning set forth in Section 2.11(b)(iv).

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

        "First Exchange Ratio" means 0.2171584, subject to adjustment as follows in the event some or all of the 699,334 StemSource Stock Options outstanding as of the date of execution of this Agreement are terminated at or prior to Closing: the number shown in cell G-18 on Schedule A shall reduced by 1 for each StemSource Stock Option terminated or otherwise not exercised for a shares of StemSource Common Stock at or prior to Closing, resulting in the adjusted First Exchange Ratio per the formula contained in the spreadsheet on Schedule A.

        "Final Date" has the meaning set forth in Section 7.1(b).

        "GAAP" means United States generally accepted accounting principles, as currently in effect.

        "Governmental or Regulatory Authority" means any court, tribunal, arbitrator, authority, agency, commission, official or other instrumentality of the United States or other country, any state, county, city or other political subdivision.

        "Intellectual Property" means (i) inventions (whether patentable or unpatentable and whether or not reduced to practice), all improvements thereto, and all patents, patent applications and patent disclosures, together with all reissuances, continuations, continuations-in-part, revisions, extensions and reexaminations thereof (collectively, "Patents"); (ii) trademarks, service marks, trade dress, logos, trade names and corporate names, together with all translations, adaptations, derivations and combinations thereof and including all goodwill associated therewith, and all applications, registrations and renewals in connection therewith (collectively, "Trademarks"), (iii) copyrightable works, all copyrights and all applications, registrations and renewals in connection therewith and mask works and all applications, registrations and renewals in connection therewith (collectively, "Copyrights"); (iv) trade secrets and confidential business information (including without limitation, product specifications, data, know-how, inventions and ideas, past, current and planned research and development, customer lists, current and anticipated customer requirements, price lists, market studies, business plans), however documented; (v) proprietary computer software and programs (including object code and source code) and other proprietary rights and copies and tangible embodiments thereof (in whatever form or medium); (vi) database technologies, systems, structures and architectures (and related processes, formulae, compositions, improvements, devices, know-how, inventions, discoveries, concepts, ideas, designs, methods and information) and any other related information, however, documented; (vii) any and all information concerning the business and affairs of a Person (which includes historical financial statements, financial projections and budgets, historical and projected sales, capital spending budgets and plans, the names and backgrounds of key personnel and personnel training and techniques and materials), however documented; (viii) any and all notes, analysis, compilations, studies, summaries, and other material prepared by or for a Person containing or based, in whole or in part, on any information included in the foregoing, however documented; (ix) all industrial designs and any registrations and applications therefor; (x) all databases and data collections and all rights therein (items (iv)-(x) shall be referred to as "Trade Secrets and Other Proprietary Information"); and (xi) any similar or equivalent rights to any of the foregoing anywhere in the world.

        "Interim Financial Statements" means the unaudited balance sheets and the related unaudited statements of income and cash flows for StemSource for the eight (8) month period ended August 31, 2002.

        "Investors' Rights Agreement" means that certain Investors' Rights Agreement by and among StemSource and certain StemSource Stockholders, dated April 30, 2001.

3


        "Knowledge of StemSource" or "Known to StemSource" means the knowledge of any officer or director of StemSource (other than Christopher Calhoun), in each case after reasonable inquiry and investigation.

        "Letter of Transmittal" has the meaning set forth in Section 2.8(a).

        "MacroPore" has the meaning set forth in the first paragraph of this Agreement.

        "MacroPore Closing Price Per Share" means the average of the closing prices per share (in U.S. dollars) of MacroPore Common Stock as quoted on the Neur Markt for the twenty (20) trading days immediately preceding (but not including) the Closing Date.

        "MacroPore Common Stock" has the meaning set forth in Section 4.2.

        "MacroPore Group" has the meaning set forth in Section 8.2(a).

        "MacroPore Warrants" means the five-year warrants issued by StemSource to MacroPore on July 12, 2002 to purchase 100,000 shares of StemSource Common Stock at an exercise price of $0.50 per share.

        "Material Adverse Effect" means, for any Person, a material adverse effect whether individually or in the aggregate (a) on the business, operations, financial condition, Assets and Properties, liabilities or prospects of such Person or (b) on the ability of such Person to consummate the transactions contemplated hereby; provided, however, that the term "Material Adverse Effect" shall not include (i) any effect attributable to general economic changes or general changes in the industry in which the Person is engaged or (ii) any change in the market price or trading volume of the securities of such Person.

        "Merger" has the meaning set forth in the Recital A of this Agreement.

        "Merger Shares" has the meaning set forth in Section 2.6(e).

        "Merger Voting Agreement" has the meaning set forth in Recital D of this Agreement.

        "Neuer Markt" means the Neuer Markt stock exchange operated by Deutsche Boerse AG, or any successor stock exchange on which shares of MacroPore Common Stock are traded.

        "Non-Competition Agreement" has the meaning set forth in Section 2.11(b)(iii).

        "Order" means any writ, judgment, decree, injunction or similar order of any Governmental or Regulatory Authority (in each such case whether preliminary or final).

        "Ordinary Course of Business" means the action of a Person that is consistent with the past practices of such Person and is taken in the ordinary course of the normal day-to-day operations of such Person.

        "Outstanding StemSource Stock" means that number of shares of capital stock of StemSource that is equal to the sum of (i) the total number of shares of StemSource Common Stock that is issued and outstanding immediately prior to the Effective Time (including the total number of outstanding StemSource Stock Options that have been exercised immediately prior to the Effective Time), plus (ii) the total number of shares of StemSource Series A Stock that is issued and outstanding immediately prior to the Effective Time. The Outstanding StemSource Stock will not include any MacroPore Warrants or shares of Common Stock underlying them, or any StemSource Stock Options that have not been exercised as of the Effective Time or shares of Common Stock underlying them.

        "Patents" has the meaning set forth in the definition of "Intellectual Property."

        "Permits" means all licenses, permits, certificates of authority, authorizations, approvals, registrations and similar consents granted or issued by any Governmental or Regulatory Authority.

4


        "Permitted Encumbrance" means (a) any Encumbrance for Taxes not yet due or delinquent, and (b) any Encumbrance for Taxes, assessments and other charges or claims with respect to Taxes, the validity of which or being contested in good faith by appropriate proceedings for which adequate reserves have been established in accordance with GAAP.

        "Person" means any natural person, corporation, general partnership, limited partnership, limited liability company, proprietorship, other business organization, trust, union, association or Governmental or Regulatory Authority.

        "Plan" means any bonus, incentive compensation, deferred compensation, pension, profit sharing, retirement, stock purchase, stock option, stock ownership, stock appreciation rights, phantom stock, leave of absence, layoff, vacation, day or dependent care, legal services, cafeteria, life, health, accident, disability, workers' compensation or other insurance, severance, separation or other employee benefit plan, practice, policy or arrangement of any kind, whether written or oral, including, but not limited to, any "employee benefit plan" within the meaning of Section 3(3) of ERISA.

        "Qualified Plan" means each Benefit Plan which is intended to qualify under Section 401 of the Code.

        "Real Property" has the meaning set forth in Section 3.14.

        "Registration Rights Agreement" has the meaning set forth in Section 2.11(b)(v).

        "Rights Holders" means, collectively, each of the following holders of more than 10,000 Merger Shares: Marc Hedrick, Terry Butler, William Futrell, Adam Katz, Ramon Llull, Mike Longaker, Thomas Mitts, Brian Matthews, Terry Cross Trust, J.M. Payne III DDS, AT Venture. Jorg Van Hacht, Christof Schoernig, Martin Korbmacher, Peter Conzatti, Norm Higo, John Hedrick and David Fung;

        "Second Exchange Ratio" means 0.5301683, subject to adjustment as follows in the event some or all of the 699,334 StemSource Stock Options outstanding as of the date of execution of this Agreement are terminated at or prior to Closing: the number shown in cell G-18 on Schedule A shall reduced by 1 for each StemSource Stock Option terminated or otherwise not exercised for a shares of StemSource Common Stock at or prior to Closing, resulting in the adjusted Second Exchange Ratio per the formula contained in the spreadsheet on Schedule A.

        "Second Merger" has the meaning set forth in Recital A.

        "Securities Act" means the Securities Act of 1933 as amended, and the rules and regulations promulgated thereunder.

        "StemSource Common Stock" has the meaning set forth in Section 3.2(a).

        "StemSource Contributing Stockholders" means, collectively, Marc Hedrick, Ramon Llull, Mike Longaker, Prosper Benhaim and Peter Lorenz.

        "StemSource Convertible Securities" has the meaning set forth in Section 3.2(b).

        "StemSource Disclosure Letter" means the disclosure letter addressed to MacroPore from StemSource, dated as of the date hereof and delivered concurrently with the execution of this Agreement which sets forth the exceptions to the representations and warranties contained in Article III hereof and certain other information called for by Article III.

        "StemSource Financial Statements" means (i) the audited balance sheets of StemSource and the related audited statements of income and cash flows for the fiscal periods ended December 31, 2001 and (ii) the Interim Financial Statements.

        "StemSource Series A Stock" has the meaning set forth in Section 3.2(a).

        "StemSource Stockholders" means the holders of outstanding capital stock of StemSource.

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        "StemSource Stockholders Group" has the meaning set forth in Section 8.2(b).

        "StemSource Stock Options" means all issued and outstanding vested stock options and warrants of StemSource.

        "StemSource Stock Option Plan" means the 2001 Stock Option/Stock Issuance Plan.

        "Stockholder Representative" has the meaning set forth in Section 2.9(b).

        "Software" has the meaning set forth in Section 3.15(j).

        "Stock Certificates" has the meaning set forth in Section 2.8(a).

        "Survival Period" has the meaning set forth in Section 8.1.

        "Surviving Corporation" has the meaning set forth in Section 2.1.

        "Tax" (and, with correlative meaning, "Taxes," "Taxable" and "Taxing") means (i) any federal, state, local or foreign income, alternative or add-on minimum tax, gross income, gross receipts, sales, use, ad valorem, transfer, franchise, profits, license, withholding, payroll, employment, excise, severance, stamp, occupation, premium, property, environmental or windfall profit tax, custom, duty or other tax, governmental fee or other like assessment or charge of any kind whatsoever, together with any interest or any penalty, addition to tax or additional amount imposed by any Governmental or Regulatory Authority responsible for the imposition of any such tax (domestic or foreign), (ii) any liability for payment of any amounts of the type described in (i) as a result of being a member of an affiliated, consolidated, combined, unitary or other group for any Taxable period and (iii) any liability for the payment of any amounts of the type described in (i) or (ii) as a result of any express or implied obligation to indemnify any other person.

        "Tax Return" means any return, report, information return, schedule or other document (including any related or supporting information) filed or required to be filed with respect to any taxing authority with respect to Taxes.

        "Third Party Expenses" has the meaning set forth in Section 5.6.

        "Trademarks" has the meaning set forth in the definition of "Intellectual Property."

        "Trade Secrets and Other Proprietary Information" has the meaning set forth in the definition of "Intellectual Property."

        1.2    Construction of Certain Terms and Phrases.    Unless the context of this Agreement otherwise requires, (a) words of any gender include each other gender; (b) words using the singular or plural number also include the plural or singular number, respectively; (c) the terms "hereof," "herein," "hereby" and derivative or similar words refer to this entire Agreement; (d) the terms "Article" or "Section" refer to the specified Article or Section of this Agreement; (e) the term "or" has, except where otherwise indicated, the inclusive meaning represented by the phrase "and/or;" and (f) "including" means "including without limitation." Whenever this Agreement refers to a number of days, such number shall refer to calendar days unless Business Days are specified. All accounting terms used herein and not expressly defined herein shall have the meanings given to them under GAAP.

ARTICLE II

THE MERGER

        2.1    The Merger.    Subject to and upon the terms and conditions of this Agreement and the applicable provisions of the DGCL, Acquisition Sub shall be merged with and into StemSource, the separate corporate existence of Acquisition Sub shall cease and StemSource shall continue as the

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surviving corporation. StemSource as the surviving corporation after the Merger is hereinafter sometimes referred to as the "Surviving Corporation."

        2.2    Effective Time.    Subject to the provisions of this Agreement, the parties hereto shall cause the Merger to be consummated by filing a certificate of merger substantially in the form attached hereto as Exhibit B (the "Certificate of Merger") with the Secretary of State of Delaware in accordance with the relevant provisions of the DGCL (the time of such filing (or such later time as may be agreed in writing by the parties and specified in the Certificate of Merger) being the "Effective Time") as soon as practicable on the Closing Date. Unless the context otherwise requires, the term "Agreement" as used herein refers collectively to this Agreement and the Certificate of Merger.

        2.3    Effect of the Merger.    At the Effective Time, the effect of the Merger shall be as provided in this Agreement and the applicable provisions of the DGCL. Without limiting the generality of the foregoing, and subject thereto, at the Effective Time all the property, rights, privileges, powers and franchises of StemSource and Acquisition Sub shall vest in the Surviving Corporation, and all the debts, liabilities, obligations and duties of StemSource and Acquisition Sub shall become the debts, liabilities, obligations and duties of the Surviving Corporation. The Surviving Corporation shall become a wholly-owned subsidiary of MacroPore.

        2.4    Certificate of Incorporation; Bylaws.    

        2.5    Directors and Officers.    The directors of Acquisition Sub immediately prior to the Effective Time shall be the initial directors of the Surviving Corporation, to serve until their respective successors are duly elected or appointed. The officers of Acquisition Sub immediately prior to the Effective Time shall be the initial officers of the Surviving Corporation, to serve until their successors are duly elected or appointed.

        2.6    Effect on Capital Stock/Merger Consideration.    

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        2.7    Dissenters' Rights.    Any shares of Outstanding StemSource Stock and other capital stock (the "StemSource Shares") that have not been voted for approval of this Agreement and with respect to which a demand for payment and appraisal have been properly made in accordance with the California Code and the DGCL ("Dissenting Shares"), will not be converted into the right to receive the Merger Shares otherwise exchangeable with respect to such Dissenting Shares at or after the Effective Time but will be converted into the right to receive such consideration as may be determined to be due with respect to such Dissenting Shares pursuant to the California Code and the DGCL. If a holder of Dissenting Shares ("Dissenting Stockholder") withdraws his or her demand for such payment and appraisal or becomes ineligible for such payment and appraisal, then, as of the Effective Time or the occurrence of such event of withdrawal or ineligibility, whichever last occurs, such holder's Dissenting Shares will cease to be Dissenting Shares and will be converted into the right to receive, and will be exchangeable for, the Merger Shares into which such Dissenting Shares would have been converted pursuant to Section 2.6(a) hereof. StemSource will give MacroPore and Acquisition Sub prompt notice of any demand received by StemSource from a holder of Dissenting Shares for appraisal of Shares, and MacroPore shall have the right to participate in, at its sole expense, all negotiations and proceedings with respect to such demand. StemSource agrees that, except with the prior written consent of MacroPore, or as required under the California Code or the DGCL, it will not voluntarily make any payment with respect to, or settle or offer or agree to settle, any such demand for appraisal. Each Dissenting Stockholder who, pursuant to the provisions of the California Code or the DGCL, becomes entitled to payment of the value of the Dissenting Shares will receive from MacroPore payment

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therefor but only after the value therefor has been agreed upon or finally determined pursuant to such provisions.

        2.8    Exchange Procedure.    

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        2.9    Escrow Agreement and Stockholder Representative.    

        2.10    Securities Laws Compliance.    MacroPore will issue the shares of Merger Shares to be issued in the Merger pursuant to Section 2.6(a) hereof pursuant to the exemption(s) from registration under Section 4(2) and/or Regulation D promulgated under the Securities Act and applicable exemptions under applicable state securities laws. Concurrently with execution of this Agreement, each StemSource Stockholder shall execute and deliver to MacroPore an Investment Representation Letter in the form of Exhibit F attached hereto (the "Investment Representation Letter"), which shall, among other things, evidence such StemSource Stockholder's understanding and acknowledgement that the shares of Merger Shares to be issued to the StemSource Stockholders pursuant to Section 2.6(a) will be "restricted securities" within the meaning of Rule 144 under the Securities Act.

        2.11    Closing.    

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ARTICLE III

REPRESENTATIONS AND WARRANTIES OF STEMSOURCE

        StemSource represents and warrants to MacroPore and Acquisition Sub as of the date hereof and as of the Closing Date, except as set forth on the StemSource Disclosure Letter furnished to MacroPore specifically identifying the relevant subparagraph hereof, as follows:

        3.1    Organization of StemSource.    StemSource is a corporation duly organized, validly existing, and in good standing under the laws of the State of Delaware. StemSource is duly authorized to conduct business and is in good standing in each jurisdiction where such qualification is required except for any jurisdiction where failure so to qualify would not have a Material Adverse Effect upon StemSource. StemSource has full power and authority, and holds all Permits and authorizations necessary to carry on its business and to own and use the Assets and Properties owned and used by StemSource except where the failure to have such power and authority or to hold such Permit or authorization would not have a Material Adverse Effect on StemSource. StemSource has delivered to MacroPore correct and complete copies of its Certificate of Incorporation and Bylaws, each as amended to date.

        3.2    Capital Stock of StemSource.    

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        3.3    Ownership of Shares.    Each StemSource Stockholder owns of record that number of shares of StemSource Common Stock listed opposite such stockholder's name in Section 3.2(a) of the StemSource Disclosure Letter. Each holder of StemSource Convertible Securities owns of record that number of StemSource Convertible Securities listed opposite such holder's name in Section 3.2(b) of the StemSource Disclosure Letter. The delivery of the stock certificate(s) representing the Outstanding StemSource Stock owned by the StemSource Stockholders in the manner provided in Section 2.8 will transfer to the MacroPore good and valid title thereto.

        3.4    Authority of StemSource.    StemSource has all necessary corporate power and corporate authority and has taken all action necessary to enter into this Agreement, to consummate the transactions contemplated hereby and to perform its obligations hereunder and no other corporate proceedings on the part of StemSource are necessary to authorize this Agreement or to consummate the transactions contemplated hereby (other than the approval of this Agreement by the StemSource Stockholders in accordance with the DGCL, and effecting the Merger). This Agreement has been duly and validly executed and delivered by StemSource and, assuming due authorization, execution and delivery by the other parties to this Agreement, constitutes a legal, valid and binding obligation of StemSource enforceable against StemSource in accordance with its terms except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement of creditors' rights generally and (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies.

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        3.5    No Affiliates.    StemSource does not have any Affiliates (other than natural persons) or subsidiaries and is not a partner in any partnership or a party to a joint venture.

        3.6    No Conflicts.    The execution and delivery by StemSource of this Agreement does not, and the performance by StemSource of its obligations under this Agreement and the consummation of the transactions contemplated hereby will not:

        3.7    Consents and Governmental Approvals and Filings.    Other than filings relating to the Merger, no consent, approval or other action of, filing with or notice to any Governmental or Regulatory Authority on the part of StemSource is required in connection with the execution, delivery and performance of this Agreement or the consummation of the transactions contemplated hereby.

        3.8    Books and Records.    The minute books and other corporate records of StemSource as made available to MacroPore contain a true and complete record in all material aspects of all actions taken at all meetings and by all written consents in lieu of meetings of the stockholders, the boards of directors and committees of the boards of directors of StemSource. The stock transfer ledgers and other similar records of StemSource accurately reflect all issuances and record transfers in the capital stock of StemSource.

        3.9    StemSource Financial Statements.    StemSource has previously delivered to MacroPore the StemSource Financial Statements. Such StemSource Financial Statements (i) have been prepared in accordance with the Books and Records of StemSource, (ii) have been prepared in conformity with GAAP, and (iii) fairly present the financial condition and results of operations and cash flows of StemSource as of the respective dates thereof and for the periods covered thereby; provided that the Interim Financial Statements lack footnotes.

        3.10    Absence of Changes.    Except for the execution and delivery of this Agreement and the transactions to take place pursuant hereto on or prior to the Closing Date, since June 30, 2002, there has not been any material adverse change, or any event or development which, individually or together with other such events, would reasonably be expected to have a Material Adverse Effect on StemSource.

        3.11    No Undisclosed Liabilities.    Except as disclosed in the StemSource Financial Statements, and except for current liabilities incurred in the Ordinary Course of Business which have not had, and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect on StemSource, there are no liabilities (whether absolute, contingent, accrued or otherwise) (including but not limited to any liability for Taxes) that are not so disclosed, nor, to the Knowledge of

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StemSource, any basis for any claim against StemSource for any such liabilities relating to or affecting StemSource or any of its Assets and Properties.

        3.12    Tangible Personal Property.    StemSource is in possession of and has good and marketable title to, or has valid leasehold interests in or valid rights under written agreements to use, all tangible personal property, equipment, plants, buildings, structures, facilities and all other Assets and Properties used in or reasonably necessary for the conduct of StemSource's business, including all tangible personal property reflected on StemSource Financial Statements and any tangible personal property acquired since that date other than property disposed of since such date in the Ordinary Course of Business. All such tangible personal property, equipment, plants, buildings, structures, facilities and all other assets and properties are listed in Section 3.12 of the StemSource Disclosure Letter and are free and clear of all Encumbrances, other than Permitted Encumbrances, and are in good operating condition and repair (subject to normal wear and tear) having regard to its current use.

        3.13    Benefit Plans; ERISA.    

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        3.14    Real Property.    StemSource does not own any real property. Section 3.14 of the StemSource Disclosure Letter contains a complete and accurate municipal description of each parcel of real property leased by StemSource (as lessee or lessor) (the "Real Property") and, to the Knowledge of StemSource, all Encumbrances (other than Permitted Encumbrances) relating to or affecting the Real Property. StemSource has a valid leasehold interest in the Real Property free and clear of all Encumbrances other than Permitted Encumbrances. StemSource has rights of ingress and egress with respect to the Real Property, and all buildings, structures, facilities, fixtures and other improvements thereon material for the operation of StemSource's business as currently conducted. There is no pending, or to the Knowledge of StemSource, there is no contemplated or threatened condemnation of any of the respective parcels of Real Property or any part thereof. To the Knowledge of StemSource, none of such Real Property, buildings, structures, facilities, fixtures or other improvements, or the use thereof, contravenes or violates any building, zoning, fire protection, administrative, occupational safety and health or other applicable law, rule, or regulation except for any contravention or violation which individually or in the aggregate would not reasonably be expected to have a Material Adverse Effect on StemSource. Each lease with respect to the Real Property is a legal, valid and binding agreement of StemSource subsisting in full force and effect enforceable in accordance with its terms, and there is no, and StemSource has not received notice of any material default (or any condition or event which, after notice or lapse of time or both, would constitute a material default) thereunder.

        3.15    Intellectual Property Rights.    

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        3.16    Proprietary Information of Third Parties.    No third party has claimed to StemSource or, to the Knowledge of StemSource, has a reasonable basis to claim that any person employed by or affiliated with StemSource in connection with and during StemSource's ownership and operation of its business has (i) violated or may be violating any of the terms or conditions of such person's employment, non-competition or non-disclosure agreement with such third party, (ii) disclosed or may be disclosing or utilized or may be utilizing any Trade Secrets and Other Proprietary Information or documentation of such third party, or (iii) interfered or may be interfering in the employment relationship between such third party and any of its present or former employees. No third party has requested information from StemSource which relates to such a claim. To the Knowledge of StemSource, no person employed by or affiliated with StemSource in connection with and during StemSource's ownership and operation of its business has employed or proposes to employ any trade secret or any information or documentation proprietary to any former employer and no person employed by or affiliated with StemSource in connection with and during StemSource's ownership and operation of its business has violated any confidential relationship which such person may have had with any third party, in connection with the development, manufacture or sale of any product or proposed product or the development or sale of any service or proposed service of StemSource, and the o the Knowledge of StemSource, there is no reason to believe there will be any such employment or violation.

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        3.17    Litigation.    There are no Actions or Proceedings pending or, to the Knowledge of StemSource, threatened against StemSource, relating to or affecting (i) StemSource, its Assets and Properties or StemSource's business, or (ii) the transactions contemplated by this Agreement, and, to the Knowledge of StemSource, there are no facts or circumstances that could reasonably be expected to give rise to any such Action or Proceeding. StemSource is not in default with respect to any Order, and there are no unsatisfied judgments against StemSource. StemSource has not received notice, and does not otherwise have knowledge of any Orders outstanding against StemSource.

        3.18    Compliance with Law.    StemSource is in compliance with all applicable laws, statutes, Orders, ordinances and regulations, whether federal, state, local or foreign, except where the failure to comply, in each instance and in the aggregate, would not reasonably be expected to have a Material Adverse Effect on StemSource. StemSource has not received any notice to the effect that, or otherwise has been advised that, StemSource is not in compliance with any of such laws, statutes, Orders, ordinances or regulations, where the failure to comply could reasonably be expected to result in a Material Adverse Effect on StemSource.

        3.19    Contracts.    

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        3.20    Environmental Matters.    

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        3.21    Insurance.    Set forth in Section 3.21 of the StemSource Disclosure Letter is a complete and accurate list of all primary, excess and umbrella policies, bonds and other forms of insurance currently owned or held by or on behalf of and/or providing insurance coverage to StemSource or the Assets and Properties of StemSource (or any of StemSource's directors, officers, salespersons, agents or employees). All policies set forth on the StemSource Disclosure Letter are in full force and effect, and with respect to such policies, all premiums currently payable or previously due have been paid, and no notice of cancellation or termination has been received by StemSource with respect to any such policy. All such policies are sufficient for compliance with all requirements of law and all agreements to which StemSource is a party or otherwise bound, and are valid, outstanding, collectible and enforceable policies and, to the Knowledge of StemSource, provide adequate insurance coverage for StemSource and the business and Assets and Properties of StemSource and will remain in full force and effect through the respective dates set forth in the StemSource Disclosure Letter. None of such policies contains a provision that would permit the termination, limitation, lapse, exclusion or change in the terms of coverage of such policy (including, without limitation, a change in the limits of liability) by reason of the consummation of the transactions contemplated by this Agreement. Complete and accurate copies of all such policies and related documentation have previously been provided to the MacroPore.

        3.22    Tax Matters.    

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        3.23    Labor and Employment Relations.    To the Knowledge of StemSource, no officer or group of five (5) or more employees, acting as a group, of StemSource has or have decided to terminate his, her or their employment with StemSource now or after the Effective Time. StemSource is not a party to or bound by any collective bargaining agreement with any labor organization, group or association covering any of its employees and, to the Knowledge of StemSource, there are no attempts to organize any of StemSource's employees by any person, unit or group seeking to act as their bargaining agent. To the Knowledge of StemSource, StemSource has complied in all material respects with all applicable laws relating to the employment of labor, including provisions thereof relating to wages, hours, equal opportunity, collective bargaining, discrimination against race, color, national origin, religious creed, physical or mental disability, sex, age, ancestry, medical condition, marital status or sexual orientation, and the withholding and payment of social security and other Taxes. There are no pending or, to the Knowledge of StemSource, threatened charges (by employees, their representatives or governmental authorities) of unfair labor practices or of employment discrimination or of any other wrongful action with respect to any aspect of employment of any person employed or formerly employed by StemSource. To the Knowledge of StemSource, no union representation elections relating to StemSource's employees have been scheduled by any Governmental or Regulatory Authority, no

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organizational effort is being made with respect to any of such employees, and no investigation of StemSource's employment policies or practices by any Governmental or Regulatory Authority is pending or threatened. StemSource is not currently, and in the past has not been, involved in labor negotiations with any unit or group seeking to become the bargaining unit for any employees of StemSource. StemSource has never experienced any work stoppages and to the Knowledge of StemSource, no work stoppage has been threatened or is planned by its employees.

        3.24    Certain Employees.    Set forth in Section 3.24 of the StemSource Disclosure Letter is a list of the names of StemSource's employees and consultants as of the date hereof, together with the title or job classification of each such person and the total compensation (with wages and bonuses, if any, separately detailed) paid in 2001 (if applicable) and the current rate of pay for each such person on the date of this Agreement. None of such persons has an employment agreement or understanding, whether oral or written, with StemSource which is not terminable on notice by StemSource without cost or other liability to StemSource.

        3.25    Absence of Certain Developments.    Except for the execution and delivery of this Agreement and the transactions to take place pursuant hereto on or prior to the Closing Date, since June 30, 2002, StemSource has not:

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        3.26    Customers.    Section 3.26 of the StemSource Disclosure Letter sets forth a true and correct list of StemSource's current customers (i) contributing more than ten thousand dollars ($10,000) per annum to the gross revenues of StemSource during the 2001 fiscal year or (ii) who are material to StemSource's business. Since January 1, 2002, no single customer or group of affiliated customers contributing more than ten thousand dollars ($10,000) per annum to the gross revenues of StemSource's business has stopped doing business with StemSource, and no such customer has given notice to StemSource of an intention to discontinue doing business or reduce the level of gross revenues from that in fiscal year 2001 with StemSource.

        3.27    Necessary Property.    All of the Real Property and Assets and Properties owned or leased by StemSource and the Intellectual Property listed on the StemSource Disclosure Letter owned by or licensed to StemSource constitute all of the property reasonably necessary for the conduct of StemSource's business in the manner and to the extent presently conducted by StemSource.

        3.28    Bank Accounts.    Section 3.28 of the StemSource Disclosure Letter contains a complete and accurate list of each deposit or asset account maintained by or on behalf of StemSource with any bank, brokerage house or other financial institution, specifying with respect to each the name and address of the institution, the name under which the account is maintained, the account number, and the name and title or capacity of each Person authorized to have access thereto.

        3.29    Permits.    Section 3.29 of the StemSource Disclosure Letter contains a true and complete list of all Permits used in and material, individually or in the aggregate, to StemSource's business as currently conducted. All such Permits are currently effective and valid and have been validly issued. No additional Permits are necessary to enable StemSource to conduct its business in material compliance with all applicable federal, state and local laws. To the Knowledge of StemSource, there is no pending Action or Proceeding by any Governmental or Regulatory Authority which could affect such Permits in any material respect or their sufficiency for the current conduct of StemSource's business or of the conduct of StemSource's business after the Closing. StemSource has provided or made available to MacroPore true and complete copies of such Permits.

        3.30    Third Party Consents.    No consent, approval or authorization of any third party on the part of StemSource is required in connection with the consummation of the transactions contemplated hereunder.

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        3.31    Brokers.    Neither any StemSource Stockholder nor StemSource has retained any broker in connection with the transactions contemplated hereunder, as would render StemSource or MacroPore liable to pay any fee or other consideration. MacroPore and StemSource have, and will have, no obligation to pay any broker's, finder's, investment banker's, financial advisor's or similar fee in connection with this Agreement or the transactions contemplated hereby by reason of any action taken by or on behalf of StemSource or any of the StemSource Stockholders.

        3.32    Material Misstatements and Omissions.    The statements, representations and warranties of StemSource contained in this Agreement (including the exhibits and schedules hereto) and in each document, statement, certificate or exhibit furnished or to be furnished by or on behalf of StemSource pursuant hereto, or in connection with the transactions contemplated hereby, taken together, do not contain and will not contain any untrue statement of a material fact and do not or will not omit to state a material fact necessary to make the statements or facts contained herein or therein, in light of the circumstances made, not misleading.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF MACROPORE AND ACQUISITION SUB

        MacroPore and Acquisition Sub, jointly and severally, represent and warrant to StemSource as of the date hereof and as of the Closing Date, as follows:

        4.1    Organization.    Each of MacroPore and Acquisition Sub is a corporation duly organized, validly existing, and in good standing under the laws of the State of Delaware. Each of MacroPore and Acquisition Sub has the requisite power and authority to carry on its respective business and own its Assets and Properties except where failure to have such power and authority would not have a Material Adverse Effect on MacroPore or Acquisition Sub, respectively. Each of MacroPore and Acquisition Sub is duly qualified to conduct its respective business and is in good standing under the laws of each jurisdiction where such qualification is required except for any jurisdiction where failure so to qualify would not have a Material Adverse Effect upon MacroPore or Acquisition Sub, as the case may be.

        4.2    Capital Stock of MacroPore.    The authorized capital stock of MacroPore, consists of (i) 95,000,000 shares of common stock, par value $0.001 per share (the "MacroPore Common Stock"), of which 13,141,251 shares were issued and outstanding as of October 9, 2002; (ii) 2,051,220 shares of capital stock of MacroPore in treasury as of October 9, 2002; and (iii) 5,000,000 shares of Preferred Stock, $0.001 par value per share for which the Board of Directors of MacroPore is expressly authorized to provide for the issuance of in one or more classes or series, none of which are outstanding. Each share of the issued and outstanding capital stock of MacroPore is duly authorized, validly issued, fully paid and nonassessable. Since 2001, MacroPore has engaged in regular repurchases of its own capital stock on the open market, which repurchases are expected to continue in the future. As a result, the capitalization representations contained in this Section 4.2 are subject to change prior to Closing. At Closing, and upon request of StemSource, MacroPore will provide an updated capitalization representation.

        4.3    Authority.    Each of MacroPore and Acquisition Sub has all necessary corporate power and corporate authority and has taken all corporate action necessary to enter into this Agreement, to consummate the transactions contemplated hereby and to perform its respective obligations hereunder and no other proceedings or corporate or stockholder action on the part of MacroPore or Acquisition Sub are necessary to authorize this Agreement or to consummate the transactions contemplated hereby. This Agreement has been duly and validly executed and delivered by each of MacroPore and Acquisition Sub and (assuming due authorization, execution and delivery by the other parties to this Agreement) constitutes a legal, valid and binding obligation of each of MacroPore and Acquisition Sub, respectively, enforceable against each of MacroPore and Acquisition Sub in accordance with its terms except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium and other laws of

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general application affecting enforcement of creditors' rights generally and (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies.

        4.4    Litigation.    There are no Actions or Proceedings pending or, to the Knowledge of MacroPore or Acquisition Sub, threatened against either MacroPore or Acquisition Sub, relating to or affecting (i) MacroPore or Acquisition Sub, or either of their Assets and Properties or either of their businesses, or (ii) the transactions contemplated by this Agreement, and, to the Knowledge of MacroPore and Acquisition Sub, there are no facts or circumstances that could reasonably be expected to give rise to any such Action or Proceeding. Neither MacroPore nor Acquisition Sub are in default with respect to any Order, and there are no unsatisfied judgments against MacroPore or Acquisition Sub. Neither MacroPore nor Acquisition Sub has received notice, or otherwise has knowledge of any Orders outstanding against either of MacroPore or Acquisition Sub.

        4.5    Reports and Financial Statements.    MacroPore has previously furnished or made available to StemSource complete and accurate copies, as amended or supplemented, of its (a) Form 10-Q for the period ended June, 2002 as filed with the Securities and Exchange Commission ("SEC") and (b) all other reports filed by MacroPore under Section 13 or subsections (a) or (c) of Section 14 of the Exchange Act with the SEC since January, 2001 (such reports are collectively referred to herein as the "MacroPore Reports"). The MacroPore Reports constitute all of the documents required to be filed by MacroPore under Section 13 or subsections (a) or (c) of Section 14 of the Exchange Act with the SEC from January, 2001 through the date of this Agreement. The MacroPore Reports have been duly and timely filed, were in compliance in all material respects with the requirements of the Exchange Act and the rules and regulations thereunder when filed, and were complete and correct in all material respects as of the dates at which the information therein was furnished. As of their respective dates, the MacroPore Reports did not contain any 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. The audited financial statements and unaudited interim financial statements of MacroPore included in the MacroPore Reports (i) complied as to form in all material respects with applicable accounting requirements and the published rules and regulations of the SEC with respect thereto when filed, (ii) were prepared in accordance with GAAP applied on a consistent basis throughout the periods covered thereby (except as may be indicated therein or in the notes thereto, and in the case of quarterly financial statements, as permitted by Form 10-Q under the Exchange Act), (iii) fairly present the consolidated financial condition, results of operations and cash flows of MacroPore as of the respective dates thereof and for the periods referred to therein, and (iv) are consistent with the books and records of MacroPore. Since the date of the filing with the SEC of MacroPore's most recent Form 10-Q, there has been no material adverse change in the financial condition or results operations of MacroPore that has resulted in a material adverse change in the businesses, assets, properties, operations or condition (financial or otherwise) of MacroPore. MacroPore has delivered all audit committee reports, meeting notes and other audit-committee documents to StemSource and to the Knowledge of MacroPore, there are no restatements of MacroPore's financial statements currently contemplated as discussed with MacroPore's Audit Committee. To the Knowledge of MacroPore, all reports required to be filed by stockholders, officers and directors of MacroPore pursuant to Section 16(a) of the Exchange Act have been timely filed, except that Form 5's representing the following option grants have not yet been filed as required: (1) George B. Cornwall (50,000 stock options); (2) Sharon V. Shulzki (100,000 stock options); and Bruce Reuter (35,000 stock options).

        4.6    Brokers.    Neither MacroPore nor Acquisition Sub has retained any broker in connection with the transactions contemplated hereunder. Neither StemSource nor the Principal Stockholders has, and will have, any obligation to pay any broker's, finder's investment banker's, financial advisor's or similar fee in connection with this Agreement or the transactions contemplated hereby by reason of any action taken by or on behalf of MacroPore or Acquisition Sub.

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        4.7    No Conflicts.    The execution and delivery by MacroPore and Acquisition Sub of this Agreement does not, and the performance by MacroPore and Acquisition Sub of their respective obligations under this Agreement and the consummation of the transactions contemplated hereby will not:

        4.8    Consents and Governmental Approvals and Filings.    No consent, approval or other action of, filing with or notice to any Governmental or Regulatory Authority on the part of MacroPore or Acquisition Sub is required in connection with the execution, delivery and performance of this Agreement or the consummation of the transactions contemplated hereby.

        4.9    Ownership of Acquisition Sub; No Prior Activities.    As of the date hereof and the Effective Time, except for obligations or liabilities incurred in connection with its incorporation or organization and the transactions contemplated by this Agreement and except for this Agreement and any other agreements or arrangements contemplated by this Agreement, Acquisition Sub has not and will not have incurred, directly or indirectly, through any subsidiary or affiliate, any obligations or liabilities or engaged in any business activities of any type or kind whatsoever or entered into any agreements or arrangements with any Person.

        4.10    Additional Representations Relating to the Reorganization.    

        4.11    Merger Shares.    Each of the Merger Shares, upon issuance thereof, will be duly authorized, validly issued, fully paid, nonassessable, and not subject to any Encumbrance. The Merger Shares shall be issued in compliance with all applicable securities laws.

        4.12    Material Misstatements and Omissions.    The statements, representations and warranties of MacroPore contained in this Agreement (including the exhibits and schedules hereto) and in each document, statement, certificate or exhibit furnished or to be furnished by or on behalf of MacroPore pursuant hereto, or in connection with the transactions contemplated hereby, taken together, do not contain and will not contain any untrue statement of a material fact and do not or will not omit to state a material fact necessary to make the statements or facts contained herein or therein, in light of the circumstances made, not misleading.

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ARTICLE V

COVENANTS

        5.1    Operation of Business Prior to Effective Time.    Except as otherwise expressly provided in this Agreement, between the date hereof and the Effective Time, StemSource will operate its business in the Ordinary Course of Business and, to the extent consistent therewith, with no less diligence and effort than would be applied in the absence of this Agreement, use all commercially reasonable efforts to seek to preserve intact its current business organization, keep available the service of its current officers and employees and preserve its relationships with customers, suppliers, distributors, lessors, creditors, employees, contractors and others having business dealings with it with the intention that its goodwill and ongoing businesses shall be unimpaired at the Effective Time. Without limiting the generality of the foregoing, except as otherwise expressly provided in this Agreement, prior to the Effective Time:

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        5.2    No Solicitation or Negotiation.    Between the date hereof and the termination of this Agreement, except as otherwise provided in this Agreement or in the furtherance of the transactions contemplated or permitted hereby, StemSource will not (nor will StemSource permit any of StemSource's officers, directors, employees, agents, representatives or affiliates to) directly or indirectly, take any of the following actions with any person other than MacroPore and Acquisition Sub: (i) solicit, initiate, entertain or encourage any proposals or offers from, or conduct discussions with or engage in negotiations with any person relating to any possible acquisition of StemSource (whether by way of merger, purchase of capital stock, purchase of assets or otherwise), any material portion of its capital stock or assets or any equity interest in StemSource; (ii) provide information with respect to it to any person, other than MacroPore and Acquisition Sub, relating to, or otherwise cooperate with, facilitate or encourage any effort or attempt by any such person with regard to, any possible acquisition of StemSource (whether by way of merger, purchase of capital stock, purchase of assets or otherwise), any portion of its capital stock or assets or any equity interest in StemSource; or (iii) enter into any agreement with any person providing for the possible acquisition of StemSource (whether by way of merger, purchase of capital stock, purchase of assets or otherwise), any portion of its capital stock or assets or any equity interest in StemSource.

        5.3    Access to Information.    Between the date hereof and the Effective Time, StemSource shall give MacroPore and its authorized representatives (including, without limitation, its attorneys and accountants), upon reasonable notice from MacroPore, reasonable access to all employees, customers, plants, offices, warehouses and other facilities, to (and where necessary, provide copies of) all books and records, contracts and all personnel files of current employees of StemSource and its subsidiaries

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as MacroPore may reasonably require, and will cause its officers and those of its subsidiaries to furnish MacroPore with such financial and operating data and other information with respect to the business and properties of StemSource and its subsidiaries as MacroPore may from time to time reasonably request.

        5.4    Public Announcements; StemSource Literature.    None of MacroPore, Acquisition Sub or StemSource shall issue any press release or otherwise make any public statements with respect to the transactions contemplated by this Agreement, including the Merger, without the prior consent of MacroPore and Acquisition Sub (in the case of StemSource) or StemSource (in the case of MacroPore or Acquisition Sub), except as may be required by applicable law, including any determination by MacroPore that a press release or other public statement is required under applicable securities or regulatory rules. If any party determines, with the advice of counsel, that it is required by applicable law to make this Agreement or any terms thereof public, it shall, consult with the other parties regarding such disclosure prior to any disclosure and seek confidential treatment for such terms or portions of this Agreement as may be requested by the other parties. The parties agree there shall be no public announcement of this Agreement or the consummation of the Merger except as may be required by applicable law or as necessary for furtherance of the transactions contemplated hereby. The parties agree to announce this Agreement promptly after signing, and the consummation of the Merger to StemSource's employees, customers, vendors and strategic partners in such form as is mutually agreed upon by all parties to this Agreement.

        5.5    Notification of Certain Matters.    

        5.6    Fees and Expenses.    Whether or not the Merger is consummated, all fees, costs and expenses incurred in connection with the Merger, this Agreement and the other agreements and transactions contemplated hereby and thereby, including all legal, accounting, financial advisory, broker's consulting and other fees and expenses of third parties incurred by a party in connection with the negotiation, documentation and effectuation of the terms and conditions of the Merger, this Agreement and the other agreements and transactions contemplated hereby and thereby ("Third Party Expenses"), shall be the obligation of the respective party incurring such Third Party Expenses. It is expressly understood and agreed by StemSource that none of MacroPore, Acquisition Sub or the Surviving Corporation shall have any obligation whatsoever with respect to such Third Party Expenses incurred by any of

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StemSource or any of the StemSource Stockholders (other than the legal fees of Crosby, Heafey, Roach & May Professional Corporation incurred by StemSource in connection with the Merger).

        5.7    Confidentiality.    The parties hereto will maintain in confidence, and will its directors, officers, employees, agents, Affiliates and advisors to maintain in confidence any written, oral or other information furnished at any time by another party to this Agreement in connection with the transactions contemplated by this Agreement, unless (a) such information is already known to such party or to such others other than on a confidential basis, (b) such information becomes publicly available through no fault of such party, (c) the use of such information is necessary or appropriate in making any filing or obtaining any consent or approval required for the consummation of the transactions contemplated by this Agreement, or (d) the furnishing or use of such information is required by law. If the Merger is not consummated, the confidentiality obligations of each party pursuant to this Section 5.7 will continue, and each party will, at the request of the party supplying the information, return or destroy (and provide appropriate certification thereof) any and all such written, electronic or computer-based information.

        5.8    Approval of the StemSource Stockholders.    StemSource shall take the actions necessary to conduct a meeting of the StemSource Stockholders (or distribute the requisite materials for approval by written consent) to consider and vote on the Merger at the earliest practicable date after the date of this Agreement (consistent with the requirements of Section 4(2) and/or Regulation D under the 1933 Act) and in connection therewith StemSource's Board of Directors shall recommend to the StemSource Stockholders that they approve the Merger, this Agreement and the transactions contemplated thereby. Also in connection therewith, StemSource shall supply to the StemSource Stockholders full and adequate disclosure (consistent with the requirements of Section 4(2) and/or Regulation D under the 1933 Act) of all purchases by MacroPore of shares of the capital stock of StemSource prior to the date of this Agreement; such disclosure to include all material terms of such transactions. The vote of the StemSource Stockholders shall be called, held and conducted, and any proxies or written consents shall be solicited, in compliance with StemSource's Certificate of Incorporation and Bylaws, both as amended, and in compliance with applicable law. StemSource shall also take the actions necessary to provide the requisite notice to the StemSource Stockholders pursuant to Section 1301 of the California Code and Section 262 of the DGCL.

        5.9    StemSource Employee Plans and Benefit Arrangements.    StemSource shall terminate any Employee Benefit Plans that are governed by Section 401 of the Code immediately prior to the Effective Time upon the request of MacroPore. In the event that the distribution or rollover of assets from the trust of a Code Section 401 plan that is terminated will trigger liquidation, surrender or other fees that will be imposed on the terminated plan or any participant or beneficiary of such terminated plan, StemSource shall take such actions as are necessary to reasonably estimate the amount of such fees and provide such reasonable estimate in writing to MacroPore prior to the Effective Time. Any Employee Benefit Plan that is governed by Section 401(K) of the Code and relies on a standardized prototype document shall be amended prior to the Effective Time so as not to require all corporations that are members of the same controlled group of corporations as the employer sponsoring such plan to participate in such plan. StemSource shall file any delinquent Form 5500s through the Department of Labor Delinquent Filer Voluntary Compliance Program prior to the Effective Time.

        5.10    Tax-Free Reorganization.    Subject to the express terms of this Agreement, the Parties will not knowingly undertake any voluntary action that would cause the Merger to fail to qualify as a "reorganization" within the meaning of Section 368(a) of the Code; provided, however, that no breach of this covenant shall occur as a result of the Parties consummating the Merger in accordance with the terms of this Agreement, including the repurchase obligations set forth in Section 8.7 of this Agreement. Each of the Parties agree that they will prepare all Tax Returns in a manner that is consistent with the treatment of the Merger as a tax-free reorganization under Section 368(a) of the Code.

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        5.11    Necessary Consents.    StemSource will use its best efforts to obtain such consents and authorizations of third parties, give notices to third parties and take such other actions as may be necessary or appropriate in addition to those set forth in the foregoing Sections of this Article V in order to effect the consummation of the Merger and the other transactions contemplated by this Agreement and to enable StemSource to carry on its business after the Effective Time substantially as such business was conducted by StemSource prior to the Effective Time.

        5.12    Litigation.    

        5.13    Satisfaction of Conditions Precedent.    StemSource will use its diligent efforts to satisfy or cause to be satisfied all the conditions precedent that are set forth in Article VI, and StemSource will use its best efforts to cause the Merger and the other transactions contemplated by this Agreement to be consummated in accordance with the terms of this Agreement by the Termination Date.

        5.14    Board Representation.    At or before the Effective Time, MacroPore will appoint each of Marc Hedrick, M.D. and Ron Henriksen to MacroPore's Board of Directors, to serve on such Board of Directors until the next scheduled election of directors, but in no event less than twelve (12) months. An additional member to be selected and nominated by Mr. Hedrick and Christopher Calhoun and mutually agreeable to the then current MacroPore Board of Directors, will be added to MacroPore's Board of Directors within twelve (12) months after the Closing Date. Upon the election of Marc Hedrick, Ron Henriksen and the third director described above, each of such directors shall enter into MacroPore's standard director / officer indemnification agreement.

        5.15    No Warrant Exercise.    MacroPore will not, at any time at or prior to the Effective Time, exercise the MacroPore Warrants.

ARTICLE VI

CONDITIONS TO CONSUMMATION OF THE MERGER

        6.1    Conditions to Each Party's Obligations to Effect the Merger.    The respective obligations of each party hereto to effect the Merger are subject to the satisfaction at or prior to the Effective Time of the following conditions:

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        6.2    Conditions to the Obligations of StemSource.    The obligation of StemSource to effect the Merger is subject to the satisfaction at or prior to the Effective Time of the following conditions:

        6.3    Conditions to the Obligations of MacroPore and Acquisition Sub.    The respective obligations of MacroPore and Acquisition Sub to effect the Merger are subject to the satisfaction at or prior to the Effective Time of the following conditions:

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ARTICLE VII

TERMINATION; AMENDMENT; WAIVER

        7.1    Termination.    This Agreement may be terminated and the Merger may be abandoned at any time prior to the Effective Time whether before or after approval and adoption of this Agreement by the StemSource Stockholders:

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        7.2    Effect of Termination.    In the event of the termination of this Agreement or abandonment of the Merger pursuant to Section 7.1 above, this Agreement shall forthwith become void and have no effect and there shall be no liability on the part of any party hereto or its Affiliates, directors, officers or stockholders except that the provisions of this Section 7.2, Sections 5.6, 5.7, and Article IX shall continue in full force and effect and each party shall remain liable for its prior breaches.

        7.3    Amendment.    This Agreement may be amended by action taken by StemSource, MacroPore and Acquisition Sub at any time before or after approval of the Merger by the StemSource Stockholders but after any such approval no amendment shall be made that requires the approval of such stockholders under applicable law without such approval. This Agreement (including the StemSource Disclosure Letter) may be amended only by an instrument in writing signed on behalf of all of the parties hereto.

        7.4    Extension; Waiver.    Each party hereto may, only by action taken in writing, (i) extend the time for the performance of any of the obligations or other acts of the other parties, (ii) waive any inaccuracies in the representations and warranties of the other parties contained herein or in any document certificate or writing delivered pursuant hereto or (iii) waive compliance by the other parties with any of the agreements or conditions contained herein. No such extension or waiver by any party hereto on any one or more instances, shall be deemed to be or construed as an extension or waiver of the same or any other obligation, other act, inaccuracy or compliance on any future occasion. Any agreement on the part of any party hereto to any such extension or waiver shall be valid only if set forth in an instrument, in writing, signed on behalf of such party. The failure of any party hereto to assert any of its rights hereunder shall not constitute a waiver of such rights.

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ARTICLE VIII

ACTIONS BY THE PARTIES AFTER THE CLOSING

        8.1    Survival of Representations, Warranties, Etc.    The representations, warranties and covenants contained in or made pursuant to this Agreement or any certificate, document or instrument delivered pursuant to or in connection with this Agreement in the transactions contemplated hereby shall survive the execution and delivery of this Agreement and the Closing hereunder (notwithstanding any investigation, analysis or evaluation by any party hereto or their designees of the Assets and Properties, business, operations or condition (financial or otherwise) of the other party), and thereafter the representations and warranties of the Parties herein shall continue to survive in full force and effect for a period of twelve (12) months after the Closing Date (the "Survival Period"). For avoidance of doubt, all representations and warranties of StemSource shall be notwithstanding any actual or implied knowledge or investigation by Christopher Calhoun.

        8.2    Indemnification.    

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        8.3    Indemnity Escrow Account.    The Indemnity Escrow Amount shall be maintained in the escrow account established pursuant to the Escrow Agreement until the date which is twelve (12) months following the Closing Date (the "Escrow Period") for the purpose of satisfying claims by MacroPore and the MacroPore Group for indemnification under this Article VIII. Upon expiration of the Escrow Period, and subject to the terms of this Section 8.3 and the Escrow Agreement, the Escrow Agent shall deliver or cause to be delivered to the StemSource Stockholder the balance, if any, remaining in the escrow account, in their proportionate share. If, upon expiration of the Escrow Period, MacroPore or any member of the MacroPore Group shall have asserted a claim for indemnity in accordance with this Article VIII and such claim is pending or unresolved at the time of such expiration, the Escrow Agent shall retain in escrow the amount of Escrow Shares equal to the value of the asserted claim until such matter is resolved.

        8.4    Thousand Oaks Facility.    MacroPore shall cause the StemSource facility located at 1125 Business Center Circle, Suite A, Thousand Oaks, California to remain open until the one-year anniversary of the Effective Time. MacroPore, does not, however, guarantee for any period of time the continued employment or service of any particular StemSource Stockholder, employee or consultant.

        8.5    Further Assurances.    In case at any time after the Closing any further action is necessary or desirable to carry out the purposes of this Agreement, each of the parties will take such further action (including the execution and delivery of such further instruments and documents) as the other party reasonably may request, all the sole cost and expense of the requesting party (unless the requesting party is entitled to indemnification therefor under this Article VIII).

        8.6    Reports Under Securities Exchange Act of 1934.    With a view to making available to the StemSource Stockholders the benefits of Rule 144 promulgated under the Act and any other rule or regulation of the SEC that may at any time permit a StemSource Stockholder to sell MacroPore Common Stock to the public without registration, MacroPore agrees to use commercially reasonable efforts to:

        8.7    Listing of Merger Shares.    MacroPore hereby agrees that it will make commercially best efforts to list the Merger Shares in the United States on the NYSE, AMEX, or NASDAQ National Market System, or in Germany on the Neur Markt within twelve (12) months following the Closing. On or before the date that is thirteen (13) months following the Closing (the "Closing Anniversary Date"), if the Merger Shares are not then listed in the United States on the NYSE, AMEX, or NASDAQ

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National Market System, or in Germany on the Neuer Markt, any StemSource Stockholder may then demand, at any time within ten (10) Business Days following the Closing Anniversary Date, that MacroPore purchase, within ten (10) Business Days following such ten (10) day period, any or all of the Merger Shares held by such StemSource Stockholder at the average of the closing price per share of MacroPore shares on the Neuer Markt over the 20 trading days prior to the date of demand.

        8.8    Review of Stockholder Representative.    During the Survival Period, MacroPore agrees to cause the Surviving Corporation to provide to the Stockholder Representative, promptly after completion thereof, copies of all financial statements prepared for the Surviving Corporation.

        8.9    Second Merger.    MacroPore shall take all actions necessary to effect the Second Merger as soon as practicable following the Merger.

ARTICLE IX

MISCELLANEOUS

        9.1    Notices.    All notices, requests and other communications hereunder must be in writing and will be deemed to have been duly given only if delivered personally against written receipt or by facsimile transmission with answer back confirmation or mailed (postage prepaid by certified or registered mail, return receipt requested) or by overnight courier to the parties at the following addresses or facsimile numbers:

All such notices, requests and other communications will (i) if delivered personally to the address as provided in this Section 9.1, be deemed given upon delivery, (ii) if delivered by facsimile transmission

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to the facsimile number as provided in this Section 9.1, be deemed given upon receipt, and (iii) if delivered by mail in the manner described above to the address as provided in this Section 9.1, be deemed given upon receipt (in each case regardless of whether such notice, request or other communication is received by any other Person to whom a copy of such notice, request or other communication is to be delivered pursuant to this Section). Any party from time to time may change its address, facsimile number or other information for the purpose of notices to that party by giving notice specifying such change to the other parties hereto.

        9.2    Entire Agreement.    This Agreement (and all exhibits attached hereto, and all other documents delivered in connection herewith) supersede all prior and contemporaneous discussions and agreements among the parties with respect to the subject matter hereof and contain the sole and entire agreement among the parties hereto with respect thereto.

        9.3    No Third Party Beneficiary.    The terms and provisions of this Agreement are intended solely for the benefit of each party hereto and their respective successors or permitted assigns, and it is not the intention of the parties to confer third-party beneficiary rights upon any other Person other than any Person entitled to indemnity under Article VIII.

        9.4    No Assignment; Binding Effect.    Neither this Agreement nor any right, interest or obligation hereunder may be assigned by any party hereto without the prior written consent of the other parties hereto and any attempt to do so will be void, except that any party's rights to indemnification under Article VIII may be freely assigned. This Agreement is binding upon, inures to the benefit of and is enforceable by the parties hereto and their respective successors and assigns.

        9.5    Headings.    The headings used in this Agreement have been inserted for convenience of reference only and do not define or limit the provisions hereof.

        9.6    Severability.    If any provision of this Agreement is held to be illegal, invalid or unenforceable under any present or future law or public policy, (i) such provision will be fully severable, (ii) this Agreement will be construed and enforced as if such illegal, invalid or unenforceable provision had never comprised a part hereof, (iii) the remaining provisions of this Agreement will remain in full force and effect and will not be affected by the illegal, invalid or unenforceable provision or by its severance herefrom and (iv) in lieu of such illegal, invalid or unenforceable provision, there will be added automatically as a part of this Agreement a legal, valid and enforceable provision as similar in terms to such illegal, invalid or unenforceable provision as may be possible and mutually acceptable to the parties herein, acting reasonably.

        9.7    StemSource Disclosure Letter.    Each exception set forth in the StemSource Disclosure Letter and each other response to this Agreement set forth in the StemSource Disclosure Letter is identified by reference to, or has been grouped under a heading referring to, a specific individual section of this Agreement and, except as otherwise specifically stated with respect to such exception, relates only to such section. In the event of any inconsistency between statements in the body of this Agreement and statements in the StemSource Disclosure Letter (excluding exceptions expressly set forth in the StemSource Disclosure Letter with respect to a specifically identified representation or warranty), the statements in the body of this Agreement shall control.

        9.8    Governing Law.    This Agreement shall be governed by and construed in accordance with the laws of the State of California applicable to contracts executed and performed in such State, without giving effect to conflicts of laws principles.

        9.9    Consent to Jurisdiction and Forum Selection.    The parties hereto agree that all actions or proceedings arising in connection with this Agreement shall be initiated and tried exclusively in the State and Federal courts located in the County of San Diego, State of California. The aforementioned choice of venue is intended by the parties to be mandatory and not permissive in nature, thereby precluding the possibility of litigation between the parties with respect to or arising out of this

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Agreement in any jurisdiction other than that specified in this Section 9.9. Each party hereby waives any right it may have to assert the doctrine of forum non conveniens or similar doctrine or to object to venue with respect to any proceeding brought in accordance with this paragraph, and stipulates that the State and Federal courts located in the County of San Diego, State of California shall have in personam jurisdiction and venue over each of them for the purposes of litigating any dispute, controversy or proceeding arising out of or related to this Agreement. Each party hereby authorizes and accepts service of process sufficient for personal jurisdiction in any action against it as contemplated by this Section 9.8 by registered or certified mail, return receipt requested, postage prepaid, to its address for the giving of notices as set forth in this Agreement, or in the manner set forth in Section 9.1 of this Agreement for the giving of notice. Any final judgment rendered against a party in any action or proceeding shall be conclusive as to the subject of such final judgment and may be enforced in other jurisdictions in any manner provided by law.

        9.10    Construction.    No provision of this Agreement shall be construed in favor of or against any party on the ground that such party or its counsel drafted the provision. Any remedies provided for herein are not exclusive of any other lawful remedies which may be available to either party, except as otherwise provided in this Agreement. This Agreement shall at all times be construed so as to carry out the purposes stated herein. Time shall be of the essence.

        9.11    Counterparts.    This Agreement may be executed in any number of counterparts and by facsimile, each of which will be deemed an original, but all of which together will constitute one and the same instrument.

        9.12    Advice of Counsel.    Crosby, Heafey, Roach & May, P.C., legal counsel to StemSource, has acted as legal counsel to StemSource only. StemSource Stockholders are not relying on any advice provided by counsel. StemSource Stockholders have had the opportunity to consult with attorneys of their own choice to advise them as to the terms, conditions and ramifications of this Agreement and the transactions contemplated hereby.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

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        IN WITNESS WHEREOF, this Agreement has been duly executed and delivered by the parties hereto, or their duly authorized officer, as of the date first above written.

    MACROPORE BIOSURGERY, INC.,
a Delaware corporation

 
 
By:
 
/s/  CHRISTOPHER J. CALHOUN      

 
 
Name:
 
Christopher J. Calhoun

 
 
Title:
 
President and Chief Executive Officer

 
 
MS ACQUISITION, INC.,
a Delaware corporation

 
 
By:
 
/s/  CHRISTOPHER J. CALHOUN      

 
 
Name:
 
Christopher J. Calhoun

 
 
Title:
 
President

 
 
STEMSOURCE, INC.,
a Delaware corporation

 
 
By:
 
/s/  MARC H. HEDRICK      

 
 
Name:
 
Marc H. Hedrick

 
 
Title:
 
President and Chief Executive Officer

   
[SIGNATURE PAGE TO
AGREEMENT AND PLAN OF REORGANIZATION]



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Exhibit 2.2


AMENDMENT NO.1 TO THE AGREEMENT AND PLAN OF REORGANIZATION

        This Amendment No.1 to the Agreement and Plan of Reorganization (this "Amendment") is made and entered into as of November 4, 2002, by and between MacroPore Biosurgery, Inc., a Delaware corporation ("MacroPore"), StemSource, Inc., a Delaware corporation ("StemSource") and MS Acquisition, Inc., a Delaware corporation and wholly-owned subsidiary of MacroPore ("Acquisition Sub"). Capitalized terms used herein that are not defined herein shall have the definition ascribed to them in the Merger Agreement (as defined below):

RECITALS

        A.    The Company, StemSource and Acquisition Sub entered into that certain Agreement and Plan of Reorganization dated October 9, 2002 (the "Merger Agreement");

        B.    The Company, StemSource and Acquisition Sub desire to amend the Merger Agreement so as to (i) make clear the third-party beneficiary rights that are intended by the terms of the Merger Agreement and (ii) more clearly define the contingent obligation of MacroPore to list certain shares of its Common Stock for trading on a stock exchange; and

        C.    To be amended, Section 7.3 of the Merger Agreement requires the consent of each of MacroPore, StemSource and Acquisition Sub.

AGREEMENT

        NOW, THEREFORE, in consideration of the premises and the mutual covenants contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

        1.    Amendments.    

        2.    Governing Law.    This Amendment shall be governed by and construed in accordance with the laws of the State of California applicable to contracts executed and performed in such State, without giving effect to conflicts of laws principles.

        3.    Agreement to Remain in Effect.    Except as specifically otherwise modified herein, the Merger Agreement as previously executed remains in full force and effect.

        4.    Counterparts.    This Amendment may be executed in any number of counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]

        This Amendment No. 1 to the Agreement and Plan of Reorganization has been executed effective as of the date first written above.

    MACROPORE BIOSURGERY, INC., a Delaware corporation

 
 
By:
/s/  CHRISTOPHER J. CALHOUN      
Christopher J. Calhoun, President and Chief Executive Officer

 
 
STEMSOURCE, INC., a Delaware corporation:

 
 
By
/s/  MARC HEDRICK      
Marc Hedrick, M.D., President

 
 
MS ACQUISITION, INC., a Delaware corporation

 
 
By:
/s/  CHRISTOPHER J. CALHOUN      
Christopher J. Calhoun, President

[SIGNATURE PAGE TO AMENDMENT NO. 1 TO THE
AGREEMENT AND PLAN OF REORGANIZATION]



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AMENDMENT NO.1 TO THE AGREEMENT AND PLAN OF REORGANIZATION

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Exhibit 10.1


MACROPORE BIOSURGERY, INC.
REGISTRATION RIGHTS AGREEMENT

        THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement") is entered into as of the 13th day of November, 2002, by and among MacroPore Biosurgery Inc., a Delaware corporation (the "Company"), and the holders of shares of the Company's Common Stock identified on Schedule A attached hereto (each a "Holder" and collectively, "Holders").

        WHEREAS, Holders previously held shares of StemSource, Inc., a Delaware corporation ("StemSource") and have now acquired shares of the Company pursuant to the Agreement and Plan of Reorganization dated October 9, 2002 (the "Merger Agreement"), pursuant to which SS Acquisition, Inc., a wholly-owned subsidiary of the Company, merged with and into StemSource.

        WHEREAS, in connection with the Merger Agreement and the transactions contemplated therein, the parties desire to enter into this Agreement in order to grant registration rights to the Holders as set forth below.

        NOW, THEREFORE, in consideration of the premises and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree hereto as follows:

SECTION 1. GENERAL.

        1.1    Definitions.    As used in this Agreement the following terms shall have the following respective meanings:

SECTION 2. REGISTRATION.

        2.1    Piggyback Registrations.    The Company shall notify all Holders of Registrable Securities in writing at least fifteen (15) days prior to the filing of any registration statement under the Securities Act for purposes of a public offering of securities of the Company (including, but not limited to, registration statements relating to secondary offerings of securities of the Company, but excluding Special Registration Statements) in which Christopher Calhoun, Ralph Holmes or Stefan Lemperle (the "Founders") are to participate as selling stockholders, and will afford each such Holder an opportunity to include in such registration statement all or part of such Registrable Securities held by such Holder. Each Holder desiring to include in any such registration statement all or any part of the Registrable Securities held by it shall, within fifteen (15) days after the above-described notice from the Company, so notify the Company in writing. Such notice shall state the intended method of disposition of the Registrable Securities by such Holder. If a Holder decides not to include all of its Registrable Securities in any registration statement thereafter filed by the Company, such Holder shall nevertheless continue to have the right to include any Registrable Securities in any subsequent registration statement or registration statements as may be filed by the Company with respect to offerings of its securities, all upon the terms and conditions set forth herein.

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        2.2    Expenses of Registration.    Except as specifically provided herein, all Registration Expenses incurred in connection with any registration, qualification or compliance pursuant to Section 2.1 herein shall be borne by the Company. All Selling Expenses incurred in connection with any registrations hereunder, shall be borne by the holders of the securities so registered pro rata on the basis of the number of shares so registered.

        2.3    Obligations of the Company.    Whenever required to effect the registration of any Registrable Securities, the Company shall, as expeditiously as reasonably possible:

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        2.4    Termination of Registration Rights.    All registration rights granted under this Section 2 shall terminate and be of no further force and effect four (4) years from the date hereof.

        2.5    Delay of Registration; Furnishing Information.    

        2.6    Indemnification.    In the event any Registrable Securities are included in a registration statement under Section 2.1:

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        Notwithstanding the foregoing, to the extent the indemnification provisions contained in the underwriting agreement entered into in connection with the underwritten public offering are in conflict with the foregoing provisions, the provisions in the underwriting agreement shall control.

        2.7    Limitation on Subsequent Registration Rights.    After the date of this Agreement, the Company shall not, without the prior written consent of the Holders of at least a majority of the Registrable Securities then outstanding, enter into any agreement with any holder or prospective holder of any securities of the Company that would grant such holder rights senior to those granted to the Holders hereunder with respect to the allocation of shares in an underwriting agreement.

SECTION 3. MISCELLANEOUS.

        3.1    Governing Law.    This Agreement shall be governed by and construed under the laws of the State of California as applied to agreements among California residents entered into and to be performed entirely within California.

        3.2    Survival.    The representations, warranties, covenants, and agreements made herein shall survive any investigation made by any Holder or the Company and the closing of the transactions contemplated hereby. All statements as to factual matters contained in any certificate or other instrument delivered by or on behalf of the Company pursuant hereto in connection with the transactions contemplated hereby shall be deemed to be representations and warranties by the Company hereunder solely as of the date of such certificate or instrument.

        3.3    Successors and Assigns.    Except as otherwise expressly provided herein, the provisions hereof shall inure to the benefit of, and be binding upon, the successors, assigns, heirs, executors, and administrators of the parties hereto and shall inure to the benefit of and be enforceable by each person who shall be a holder of Registrable Securities from time to time; provided, however, that prior to the receipt by the Company of adequate written notice of the transfer of any Registrable Securities specifying the full name and address of the transferee, the Company may deem and treat the person listed as the holder of such shares in its records as the absolute owner and holder of such shares for all purposes, including the payment of dividends or any redemption price.

        3.4    Entire Agreement.    This Agreement, the Merger Agreement and the other documents delivered pursuant thereto constitute the full and entire understanding and agreement between the parties with regard to the subjects hereof and no party shall be liable or bound to any other in any manner by any representations, warranties, covenants and agreements except as specifically set forth herein and therein.

        3.5    Severability.    In the event one or more of the provisions of this Agreement should, for any reason, be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality, or unenforceability shall not affect any other provisions of this Agreement, and this Agreement shall be construed as if such invalid, illegal or unenforceable provision had never been contained herein.

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        3.6    Amendment and Waiver.    

        3.7    Delays or Omissions.    It is agreed that no delay or omission to exercise any right, power, or remedy accruing to any Holder, upon any breach, default or noncompliance of the Company under this Agreement shall impair any such right, power, or remedy, nor shall it be construed to be a waiver of any such breach, default or noncompliance, or any acquiescence therein, or of any similar breach, default or noncompliance thereafter occurring. It is further agreed that any waiver, permit, consent, or approval of any kind or character on any Holder's part of any breach, default or noncompliance under the Agreement or any waiver on such Holder's part of any provisions or conditions of this Agreement must be in writing and shall be effective only to the extent specifically set forth in such writing. All remedies, either under this Agreement, by law, or otherwise, shall be cumulative and not alternative.

        3.8    Notices.    All notices required or permitted hereunder shall be in writing and shall be deemed effectively given: (a) upon personal delivery to the party to be notified, (b) when sent by confirmed electronic mail or facsimile if sent during normal business hours of the recipient; if not, then on the next business day, (c) five (5) days after having been sent by registered or certified mail, return receipt requested, postage prepaid, or (d) one (1) day after deposit with a nationally recognized overnight courier, specifying next day delivery, with written verification of receipt. All communications shall be sent to the party to be notified at the address as set forth on the signature pages hereof or at such other address as such party may designate by ten (10) days advance written notice to the other parties hereto.

        3.9    Attorneys' Fees.    In the event that any suit or action is instituted to enforce any provision in this Agreement, the prevailing party in such dispute shall be entitled to recover from the losing party all fees, costs and expenses of enforcing any right of such prevailing party under or with respect to this Agreement, including without limitation, such reasonable fees and expenses of attorneys and accountants, which shall include, without limitation, all fees, costs and expenses of appeals.

        3.10    Titles and Subtitles.    The titles of the sections and subsections of this Agreement are for convenience of reference only and are not to be considered in construing this Agreement.

        3.11    Counterparts.    This Agreement may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one instrument.

[THIS SPACE INTENTIONALLY LEFT BLANK]

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        IN WITNESS WHEREOF, the parties hereto have executed this REGISTRATION RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

COMPANY:   HOLDER:

MACROPORE BIOSURGERY, INC.
 
        

By:
 
/s/  CHRISTOPHER J. CALHOUN      
 
By:
 
        

Title:
 
President and Chief Financial Officer
 
Title:
 
        

Address:
 
Address:

[Signature Page to Registration Statement]

        IN WITNESS WHEREOF, the parties hereto have executed this REGISTRATION RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

    HOLDER:

 
 
MARC HEDRICK

 
 
By:
 
/s/  MARC HEDRICK      

 
 
Title:
 
        

 
 
Address:

[Signature Page to Registration Statement]

        IN WITNESS WHEREOF, the parties hereto have executed this REGISTRATION RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

    HOLDER:

 
 
TERRY BUTLER

 
 
By:
 
/s/  TERRY BUTLER      

 
 
Title:
 
        

 
 
Address:

[Signature Page to Registration Statement]

        IN WITNESS WHEREOF, the parties hereto have executed this REGISTRATION RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

    HOLDER:

 
 
WILLIAM FUTRELL

 
 
By:
 
        

 
 
Title:
 
        

 
 
Address:

[Signature Page to Registration Statement]

        IN WITNESS WHEREOF, the parties hereto have executed this REGISTRATION RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

    HOLDER:

 
 
RAMON LLULL

 
 
By:
 
/s/  RAMON LLULL      

 
 
Title:
 
        

 
 
Address:

[Signature Page to Registration Statement]

        IN WITNESS WHEREOF, the parties hereto have executed this REGISTRATION RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

    HOLDER:

 
 
MIKE LONGAKER

 
 
By:
 
        

 
 
Title:
 
        

 
 
Address:

[Signature Page to Registration Statement]

        IN WITNESS WHEREOF, the parties hereto have executed this REGISTRATION RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

    HOLDER:

 
 
BRIAN MATTHEWS

 
 
By:
 
/s/  BRIAN MATTHEWS      

 
 
Title:
 
        

 
 
Address:

[Signature Page to Registration Statement]

        IN WITNESS WHEREOF, the parties hereto have executed this REGISTRATION RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

    HOLDER:

 
 
TERRY CROSS TRUST

 
 
By:
 
/s/  TERRY CROSS      

 
 
Title:
 
Trustee

 
 
Address:

[Signature Page to Registration Statement]

        IN WITNESS WHEREOF, the parties hereto have executed this REGISTRATION RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

    HOLDER:

 
 
J.M. PAYNE III DDS

 
 
By:
 
/s/  J.M. PAYNE III      

 
 
Title:
 
        

 
 
Address:

[Signature Page to Registration Statement]

        IN WITNESS WHEREOF, the parties hereto have executed this REGISTRATION RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

    HOLDER:

 
 
AT VENTURE

 
 
By:
 
        

 
 
Title:
 
        

 
 
Address:

[Signature Page to Registration Statement]

        IN WITNESS WHEREOF, the parties hereto have executed this REGISTRATION RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

    HOLDER:

 
 
JORG VON HACHT

 
 
By:
 
/s/  JORG VON HACHT      

 
 
Title:
 
        

 
 
Address:

[Signature Page to Registration Statement]

        IN WITNESS WHEREOF, the parties hereto have executed this REGISTRATION RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

    HOLDER:

 
 
CHRISTOF SCHOERNIG

 
 
By:
 
/s/  CHRISTOF SCHOERNIG      

 
 
Title:
 
        

 
 
Address:

[Signature Page to Registration Statement]

        IN WITNESS WHEREOF, the parties hereto have executed this REGISTRATION RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

    HOLDER:

 
 
MARTIN KORBMACHER

 
 
By:
 
/s/  MARTIN KORBMACHER      

 
 
Title:
 
        

 
 
Address:

[Signature Page to Registration Statement]

        IN WITNESS WHEREOF, the parties hereto have executed this REGISTRATION RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

    HOLDER:

 
 
PETER CONZATTI

 
 
By:
 
/s/  PETER CONZATTI      

 
 
Title:
 
        

 
 
Address:

[Signature Page to Registration Statement]

        IN WITNESS WHEREOF, the parties hereto have executed this REGISTRATION RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

    HOLDER:

 
 
COLO LLC

 
 
By:
 
/s/  NORM HIGO      

 
 
Title:
 
Managing Director

 
 
Address:

[Signature Page to Registration Statement]

        IN WITNESS WHEREOF, the parties hereto have executed this REGISTRATION RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

    HOLDER:

 
 
JAMES T. HEDRICK

 
 
By:
 
/s/  JAMES T. HEDRICK      

 
 
Title:
 
        

 
 
Address:

[Signature Page to Registration Statement]

        IN WITNESS WHEREOF, the parties hereto have executed this REGISTRATION RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

    HOLDER:

 
 
DAVID FUNG

 
 
By:
 
/s/  DAVID FUNG      

 
 
Title:
 
        

 
 
Address:

[Signature Page to Registration Statement]

        IN WITNESS WHEREOF, the parties hereto have executed this REGISTRATION RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

    HOLDER:

 
 
DANIEL E. BUTLER TRUST

 
 
By:
 
/s/  DANIEL E. BUTLER      

 
 
Title:
 
Trustee

 
 
Address:

[Signature Page to Registration Statement]

        IN WITNESS WHEREOF, the parties hereto have executed this REGISTRATION RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

    HOLDER:

 
 
THOMAS MITTS

 
 
By:
 
        

 
 
Title:
 
        

 
 
Address:

[Signature Page to Registration Statement]

        IN WITNESS WHEREOF, the parties hereto have executed this REGISTRATION RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

    HOLDER:

 
 
RON HENRIKSEN

 
 
By:
 
/s/  RONALD D. HENRIKSEN      

 
 
Title:
 
        

 
 
Address:

[Signature Page to Registration Statement]

        IN WITNESS WHEREOF, the parties hereto have executed this REGISTRATION RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

    HOLDER:

 
 
BOB KRAMER

 
 
By:
 
/s/  BOB KRAMER      

 
 
Title:
 
        

 
 
Address:

[Signature Page to Registration Statement]

        IN WITNESS WHEREOF, the parties hereto have executed this REGISTRATION RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

    HOLDER:

 
 
PETER FODOR

 
 
By:
 
/s/  PETER FODOR      

 
 
Title:
 
        

 
 
Address:

[Signature Page to Registration Statement]

        IN WITNESS WHEREOF, the parties hereto have executed this REGISTRATION RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

    HOLDER:

 
 
JOHN FRASER

 
 
By:
 
        

 
 
Title:
 
        

 
 
Address:

[Signature Page to Registration Statement]

        IN WITNESS WHEREOF, the parties hereto have executed this REGISTRATION RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

    HOLDER:

 
 
ELIZABETH SCARBOROUGH

 
 
By:
 
/s/  ELIZABETH SCARBOROUGH      

 
 
Title:
 
        

 
 
Address:

[Signature Page to Registration Statement]


SCHEDULE A

Marc Hedrick
Terry Butler
William Futrell
Ramon Llull
Mike Longaker
Brian Matthews
Terry Cross Trust
J.M. Payne III DDS
AT Venture
Jorg Van Hacht
Christof Schoernig
Martin Korbmacher
Peter Conzatti
Norm Higo
John Hedrick
David Fung
Dan and Mary Ann Butler
Thomas Mitts
Ron Henriksen
Bob Kramer
Peter Fodor
John Fraser
Elizabeth Scarborough

[Signature Page to Registration Rights Agreement]


SECTION 1.GENERAL
 
1
 
1.1
 
Definitions
 
1

SECTION 2.REGISTRATION
 
2
 
2.1
 
Piggyback Registrations
 
2
 
2.2
 
Expenses of Registration
 
3
 
2.3
 
Obligations of the Company
 
3
 
2.4
 
Termination of Registration Rights
 
4
 
2.5
 
Delay of Registration; Furnishing Information
 
4
 
2.6
 
Indemnification
 
4
 
2.7
 
Limitation on Subsequent Registration Rights
 
6

SECTION 3.MISCELLANEOUS
 
6
 
3.1
 
Governing Law
 
6
 
3.2
 
Survival
 
6
 
3.3
 
Successors and Assigns
 
6
 
3.4
 
Entire Agreement
 
6
 
3.5
 
Severability
 
6
 
3.6
 
Amendment and Waiver
 
7
 
3.7
 
Delays or Omissions
 
7
 
3.8
 
Notices
 
7
 
3.9
 
Attorneys' Fees
 
7
 
3.10
 
Titles and Subtitles
 
7
 
3.11
 
Counterparts
 
7


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MACROPORE BIOSURGERY, INC. REGISTRATION RIGHTS AGREEMENT
SCHEDULE A