THE SECURITIES REPRESENTED BY THIS CERTIFICATE MAY NOT BE SOLD, TRANSFERRED, HYPOTHECATED OR OTHERWISE DISPOSED OF BY THE HOLDER EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT FILED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND IN COMPLIANCE WITH APPLICABLE SECURITIES LAWS OF ANY STATE WITH RESPECT THERETO OR IN ACCORDANCE WITH AN OPINION OF COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER THAT AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE AND ALSO MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF EXCEPT IN COMPLIANCE WITH ANY APPLICABLE RULES OF THE SECURITIES AND EXCHANGE COMMISSION.

No. S-

REGEN BIOLOGICS, INC. , a Delaware corporation (the “ Company ”), for value received, hereby promises to pay to ______ or its registered assigns the principal sum of $______ on April 2, 2010, and to pay interest (computed on the basis of a 360-day year of twelve 30-day months) on the unpaid principal balance hereof from the date of the Closing at the rate of interest (the “ Interest Rate ”) specified below.

1.           Interest hereon shall accrue at a rate of 8.00% per annum commencing on the date of the Closing and shall be payable, in arrears, on the Due Date.  Following the Due Date, interest hereon shall accrue at a rate of 12.00% per annum until paid in full.

2.           Payments of principal, interest and all other amounts due in respect hereof shall be made in immediatel