TTG Tutogen Medical,

(386) 418-8888

NOTICE OF SPECIAL MEETING OF STOCKHOLDERS

TO BE HELD ON WEDNESDAY, FEBRUARY 27, 2008

To the Stockholders of Regeneration Technologies, Inc.:

A special meeting of stockholders of Regeneration Technologies, Inc. will be held on February 27, 2008 at 9:00 a.m., local time, at its headquarters at 11621 Research Circle, Alachua, Florida for the following purposes:

1. To amend and restate the Regeneration Technologies certificate of incorporation (a) to increase the number of authorized shares of Regeneration Technologies common stock, par value $0.001 per share, from 50,000,000 to 150,000,000 and (b) to change the name of Regeneration Technologies to RTI Biologics, Inc. (the “Charter Amendment”).

2. To approve the issuance of Regeneration Technologies common stock to former stockholders of Tutogen Medical, Inc. pursuant to the Agreement and Plan of Merger, dated as of November 12, 2007, by and among Regeneration Technologies, Inc., Rockets FL Corp. and Tutogen Medical, Inc., as the same may be amended from time to time (the “Share Issuance”).

3. To approve any motion to adjourn or postpone the special meeting to a later date or dates, if necessary, to solicit additional proxies if there are insufficient votes at the time of the special meeting.

4. To transact such other business as may properly come before the special meeting or any adjournment or postponement thereof.

Proposals 1 and 2 are conditioned on each other and approval of each is required for completion of the merger.

The accompanying Proxy Statement further describes the matters to be considered at the meeting. A copy of the merger agreement has been included as Annex A to the Proxy Statement.

The Regeneration Technologies board of directors has set January 16, 2008 as the record date for the special meeting. Only holders of record of Regeneration Technologies common stock at the close of business on the record date will be entitled to notice of and to vote at the special meeting and any adjournments or postponements thereof. Any stockholder entitled to attend and vote at the meeting is entitled to appoint a proxy to attend and vote on such stockholder’s behalf. Such proxy need not be a holder of Regeneration Technologies common stock. To ensure your representation at the special meeting, please complete and return the enclosed proxy card. Please vote promptly whether or not you expect to attend the special meeting. Submitting a proxy now will not prevent you from being able to vote at the special meeting by attending in person and casting a vote.

The Regeneration Technologies board of directors recommends that you vote FOR the proposals to amend and restate the Regeneration Technologies certificate of incorporation, FOR the proposal to approve the issuance of Regeneration Technologies common stock in the merger and FOR the proposal to approve any motion to adjourn or postpone the special meeting to a later date or dates if necessary to solicit additional proxies.

By Order of the Board of Directors,

THOMAS F. ROSE

Secretary

Alachua, Florida

January 23, 2008

PLEASE VOTE YOUR SHARES PROMPTLY. YOU CAN FIND INSTRUCTIONS FOR VOTING ON THE ENCLOSED PROXY CARD. IF YOU HAVE QUESTIONS ABOUT THE PROPOSALS OR ABOUT VOTING YOUR SHARES, PLEASE CONTACT GEORGESON, INC. AT (800) 849-5307 (TOLL FREE) OR (212) 440-9800 (COLLECT).

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TUTOGEN MEDICAL, INC.

13709 PROGRESS BLVD.

ALACHUA, FL 32615

(386) 462-0402

NOTICE OF SPECIAL MEETING OF STOCKHOLDERS

TO BE HELD ON WEDNESDAY, FEBRUARY 27, 2008

To the Stockholders of Tutogen Medical, Inc.:

A special meeting of stockholders of Tutogen Medical, Inc. will be held on February 27, 2008 at 9:00 a.m., local time, at its headquarters at 13709 Progress Boulevard, Alachua, Florida for the following purposes:

1. To adopt the Agreement and Plan of Merger, dated as of November 12, 2007, by and among Regeneration Technologies, Inc., Rockets FL Corp. and Tutogen Medical, Inc., as the same may be amended from time to time.

2. To approve any motion to adjourn or postpone the special meeting to a later date or dates, if necessary, to solicit additional proxies if there are insufficient votes at the time of the special meeting to approve the proposal to adopt the merger agreement.

3. To transact such other business as may properly come before the special meeting or any adjournment or postponement thereof.

The accompanying Proxy Statement further describes the matters to be considered at the special meeting. A copy of the merger agreement has been included as Annex A to the Proxy Statement.

The Tutogen board of directors has set January 22, 2008 as the record date for the special meeting. Only holders of record of shares of Tutogen common stock at the close of business on the record date will be entitled to notice of and to vote at the special meeting and any adjournments or postponements thereof. To ensure your representation at the special meeting, please complete and return the enclosed proxy card. Please vote promptly whether or not you expect to attend the special meeting. Submitting a proxy now will not prevent you from being able to vote at the special meeting by attending in person and casting a vote.

The board of directors of Tutogen recommends that you vote FOR the proposal to adopt the merger agreement and FOR the proposal to approve any motion to adjourn or postpone the special meeting to a later date or dates if necessary to solicit additional proxies.

January 23, 2008

PLEASE VOTE YOUR SHARES PROMPTLY. YOU CAN FIND INSTRUCTIONS FOR VOTING ON THE ENCLOSED PROXY CARD. IF YOU HAVE QUESTIONS ABOUT THE PROPOSALS OR ABOUT VOTING YOUR SHARES, PLEASE CONTACT GEORGESON, INC. AT (800) 849-5307 (TOLL FREE) OR (212) 440-9800 (COLLECT).

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QUESTIONS AND ANSWERS ABOUT THE MEETINGS

The following questions and answers briefly address some commonly asked questions about the Regeneration Technologies and Tutogen special meetings. They may not include all the information that is important to stockholders of Tutogen and Regeneration Technologies. We urge stockholders to read carefully this entire Proxy Statement, including the annexes and the other documents referred to herein.

The merger cannot be completed unless Tutogen stockholders adopt the merger agreement, and Regeneration Technologies stockholders approve the amendment and restatement of the Regeneration Technologies certificate of incorporation and the issuance of Regeneration Technologies capital stock in the merger. Each of Regeneration Technologies and Tutogen is holding its special meeting of stockholders to vote on the proposals necessary to complete the merger. Information about these meetings, the merger and the other business to be considered by stockholders is contained in this Proxy Statement.

We are delivering this document to you as both a joint proxy statement of Tutogen and Regeneration Technologies and a prospectus of Regeneration Technologies. It is a joint proxy statement because each of our boards of directors is soliciting proxies from its stockholders. It is a prospectus because Regeneration Technologies will exchange shares of its common stock for shares of Tutogen in the merger.

Regeneration Technologies’ stockholders will continue to own their existing shares, which will not be affected by the merger.

The Tutogen board of directors recommends that Tutogen stockholders vote FOR the proposal to adopt the merger agreement.

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You may also cast your vote in person at your company’s special meeting.

If your shares are held in “street name,” through a broker, bank or other nominee, that institution will send you separate instructions describing the procedure for voting your shares. If you wish to vote at the meeting and your shares are held in “street name,” you will need to obtain a proxy form from the institution that holds your shares.

The special meeting of Tutogen stockholders will be held at its headquarters at 13709 Progress Boulevard, Alachua, Florida at 9:00 a.m., local time, on February 27, 2008. Subject to space availability, all stockholders as of the record date, or their duly appointed proxies, may attend the meeting. Since seating is limited, admission to the meeting will be on a first-come, first-served basis. Registration and seating will begin at 8:30 a.m., local time.

Stockholders who hold a majority of the shares of the Regeneration Technologies common stock issued and outstanding as of the close of business on the record date and who are entitled to vote must be present in person or represented by proxy in order to constitute a quorum to conduct business at the Regeneration Technologies special meeting.

Stockholders who hold a majority in voting power of the Tutogen common stock issued and outstanding as of the close of business on the record date and who are entitled to vote must be present in person or represented by proxy in order to constitute a quorum to conduct business at the Tutogen special meeting.

To issue Regeneration Technologies common stock in the merger: the affirmative vote of a majority of the Regeneration Technologies shares voting on the proposal is required to approve the issuance of Regeneration Technologies common stock in the merger, which is referred to in this Proxy Statement as the Share Issuance.

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To approve the merger agreement: the affirmative vote of a majority of the outstanding shares of Tutogen common stock entitled to vote is required to approve the merger agreement, which is referred to in this Proxy Statement as the Merger Proposal.

If you are a Regeneration Technologies stockholder and you fail to vote or fail to instruct your broker or other nominee how to vote on the Share Issuance, it will have no effect on the outcome of the vote for this proposal. Similarly, if you respond with an “abstain” vote, your proxy will have no effect on the outcome of the vote for this proposal. If you respond but do not indicate how you want to vote on the Share Issuance, your proxy will be counted as a vote in favor of the Share Issuance.

The approval of the Charter Amendment and the Share Issuance are conditioned on each other, and approval of each is required for completion of the merger.

If you are a Tutogen stockholder and you fail to vote or fail to instruct your broker or other nominee how to vote on the Merger Proposal, it will have the same effect as a vote against the Merger Proposal. If you respond with an “abstain” vote on the Merger Proposal, your proxy will have the same effect as a vote against the Merger Proposal. If you respond but do not indicate how you want to vote on the Merger Proposal, your proxy will be counted as a vote in favor of the Merger Proposal.

If you choose any of the first three methods, you must take the described action no later than the beginning of the applicable special meeting.

If your shares are held in an account at a broker or other nominee, you should contact your broker or other nominee to change your vote.

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Tax matters are very complicated, and the tax consequences of the merger to a particular holder of Tutogen common stock will depend in part on such holder’s circumstances. Accordingly, Tutogen and Regeneration Technologies urge you to consult your own tax advisor for a full understanding of the tax consequences of the merger to you, including the applicability and effect of federal, state, local, and foreign income tax and other laws that may apply to your particular situation. For more information, please see the section entitled “Material U.S. Federal Income Tax Consequences” beginning on page 55.

If you are a holder of Tutogen common stock, you will receive written instructions from the exchange agent after the merger is completed on how to exchange your stock certificates for Regeneration Technologies common stock. Regeneration Technologies stockholders will not be required to exchange their stock certificates in connection with the merger. Regeneration Technologies stockholders holding stock certificates should keep their stock certificates both now and after the merger is completed.

Each outstanding Tutogen employee stock option will become fully vested and will be assumed by Regeneration Technologies in the merger on terms substantially identical to those in effect immediately prior to the completion of the merger, and those options will be adjusted to entitle the holder to receive Regeneration Technologies common stock. The number of shares issuable under those options and the exercise prices for those options will be adjusted based on the exchange ratio.

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RISK FACTORS

In addition to the other information contained or incorporated by reference into this Proxy Statement, you should carefully consider the following risk factors in deciding how to vote on the merger. You also should read and consider the risks associated with each of the businesses of Regeneration Technologies and Tutogen because these risks will also relate to the combined company. Certain of these risks can be found in the documents incorporated by reference into this Proxy Statement.

Risks Relating to the Merger

Because the market price of Regeneration Technologies common stock will fluctuate, Tutogen stockholders cannot be sure of the market value of Regeneration Technologies common stock that they will receive.

The market price of Regeneration Technologies common stock will likely be different on the date Tutogen stockholders receive such shares than it is today. When we complete the merger, each share of Tutogen common stock will be converted into the right to receive 1.22 shares of Regeneration Technologies common stock. The exchange ratio is fixed and will not be adjusted for changes in the market price of either Regeneration Technologies common stock or Tutogen common stock. The merger agreement does not provide for any price-based termination right. Accordingly, the market value of the shares of Regeneration Technologies common stock that Regeneration Technologies issues to Tutogen stockholders when we complete the merger will depend on the market value of shares of Regeneration Technologies common stock at that time and could vary significantly from the market value on the date of this Proxy Statement or the date of the Tutogen special meeting. The market value of the shares of Regeneration Technologies common stock will continue to fluctuate after the completion of the merger. For example, during 2007, the market price of Regeneration Technologies common stock ranged from a low of $5.12 to a high of $11.99, all as reported on the Nasdaq Global Market. See “Market Prices and Dividends and Other Distributions” on page 15.

The price of Regeneration Technologies common stock may change as a result of:

Any of these factors, among others, could cause the market price of Regeneration Technologies common stock to fluctuate substantially. Tutogen stockholders are urged to obtain a current market quotation for Regeneration Technologies common stock. Regeneration Technologies cannot predict or give any assurances as to the market price of its common stock at any time before or after the completion of the merger.

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The issuance of shares of Regeneration Technologies common stock to Tutogen stockholders in the merger will substantially reduce the percentage interests of Regeneration Technologies stockholders.

If the merger is completed, Regeneration Technologies will issue approximately 23,694,000 shares of Regeneration Technologies common stock to Tutogen stockholders in the merger and up to 2,900,000 additional shares of common stock upon exercise of Tutogen employee stock options. Based on the number of shares of Regeneration Technologies and Tutogen common stock outstanding on the date of the Merger Agreement, former Tutogen stockholders will own, in the aggregate, approximately 45% of the shares of common stock of the combined company outstanding immediately after the merger. The issuance of shares of Regeneration Technologies common stock to Tutogen stockholders in the merger and to holders of assumed options and restricted stock units to acquire shares of Tutogen common stock and warrants will cause a significant reduction in the relative voting power and percentage interests in earnings of current Regeneration Technologies stockholders and also will reduce their liquidation value and book value.

The anticipated benefits of the merger may not be realized fully or at all or may take longer to realize than expected.

The merger involves the integration of two companies that have previously operated independently, with principal offices in two distinct locations. Due to legal restrictions, Regeneration Technologies and Tutogen have conducted only limited planning regarding the integration of the two companies. The combined company will be required to devote significant management attention and resources to integrating the two companies. This process could adversely affect the business, operating results, financial condition and stock price of the combined company. Even if Regeneration Technologies and Tutogen are able to integrate their business operations successfully, there can be no assurance that this integration will result in the realization of the full benefits of synergies, cost savings, innovation and operational efficiencies that may be possible from this integration or that these benefits will be achieved within a reasonable period of time.

Stockholders may receive a lower return on their investment after the merger.

Although Regeneration Technologies and Tutogen believe that the merger will create financial, operational and strategic benefits for the combined company and its stockholders, these benefits may not be achieved. The combination of Regeneration Technologies and Tutogen’s businesses, even if conducted in an efficient, effective and timely manner, may not result in combined operating efficiencies and financial performance that are better than what each company would have achieved independently if the merger had not occurred. In addition, the issuance of Regeneration Technologies common stock pursuant to the merger may result in a decrease in the market price of Regeneration Technologies common stock.

Regeneration Technologies and Tutogen expect to incur potentially significant merger-related costs in connection with the transaction and the integration of the two companies.

Regeneration Technologies expects to incur charges of approximately $4 million in outside costs, including legal, accounting and financial advisory fees, which are expected to be accounted for as part of the purchase price when the merger is completed. Tutogen expects to incur charges of approximately $3.75 million in outside costs, including legal, accounting and financial advisory fees, which are expected to be accounted for as part of the purchase price when the merger is completed. The actual transaction costs may be higher than these estimates. In addition, the combined company expects to incur integration costs associated with the merger. These integration costs will be charged to operations in the fiscal quarter in which they are incurred, which would adversely affect the financial condition, results of operations and cash flows of the combined company.

Uncertainty about the merger and diversion of management could harm Tutogen, Regeneration Technologies or the combined company, whether or not the merger is completed.

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Tutogen or Regeneration Technologies, or they may seek to change their existing business relationship. In addition, as a result of the merger, current and prospective employees could experience uncertainty about their future with Tutogen or Regeneration Technologies or the combined company. These uncertainties may impair each company’s ability to retain, recruit or motivate key personnel. Completion of the merger will also require a significant amount of time and attention from management. The diversion of management attention away from ongoing operations could adversely affect ongoing operations and business relationships.

If the merger is not completed, each party’s stock price and future business operations could be harmed.

Completion of the merger is conditioned upon, among other things, the receipt of approval by the stockholders of Regeneration Technologies and Tutogen. There is no assurance that we will receive the necessary approvals or satisfy the other conditions in the completion of the merger.

If the merger is not completed for any reason, the stock price of Regeneration Technologies or Tutogen may decline if the current market price reflects a positive market assumption that the merger will be completed. If the merger is not completed, each company would still be required to pay its respective costs related to the merger, including financial advisory, legal, accounting and other fees and expenses. To date, Regeneration Technologies has capitalized these costs; however, in the event the merger agreement is terminated, these and any additional expenses would be written off as a one-time expense upon termination.

Additionally, if the merger agreement is terminated, either company may be unable to find a partner willing to engage in a similar transaction on terms as favorable as those set forth in the merger agreement, or at all. This could limit each company’s ability to pursue its strategic goals.

The merger agreement contains provisions that could discourage a potential competing acquiror that might be willing to pay more to acquire Tutogen or that might be willing to acquire Regeneration Technologies.

The merger agreement contains “no shop” provisions that restrict Regeneration Technologies’ and Tutogen’s ability to solicit or facilitate proposals regarding a merger or similar transaction with another party. Further, the respective board of directors of Regeneration Technologies and Tutogen may not withdraw or adversely qualify their recommendation regarding the merger agreement. Although each of the Regeneration Technologies and Tutogen boards are permitted to terminate the merger agreement in response to a superior proposal if they determine that a failure to do so would be inconsistent with their fiduciary duties, doing so would entitle the non-terminating party to collect a $6.5 million termination fee from the terminating party. We describe these provisions under “The Merger Agreement — Termination” beginning on page 66 and “— Termination Fees and Expenses” beginning on page 66.

These provisions could discourage a potential competing acquiror from considering or proposing an acquisition, even if it were prepared to pay consideration with a higher value than that proposed to be paid in the merger, or might result in a potential competing acquiror proposing to pay a lower per share price than it might otherwise have proposed to pay because of the added expense of the termination fee.

Resales of shares of Regeneration Technologies common stock following the merger and additional obligations to issue shares of Regeneration Technologies common stock may cause the market price of Regeneration Technologies common stock to fall.

As of January 16, 2008, Regeneration Technologies had 29,880,296 shares of common stock outstanding and 3,697,739 shares of common stock subject to outstanding options and other rights to purchase or acquire its shares. Regeneration Technologies currently expects that it will issue approximately 23,694,000 shares of Regeneration Technologies common stock in connection with the merger. The issuance of these new shares of Regeneration Technologies common stock and the sale of additional shares of Regeneration Technologies

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common stock that may become eligible for sale in the public market from time to time upon exercise of options (including up to 2,900,000 Regeneration Technologies options as a result of the assumption of Tutogen options) could have the effect of depressing the market price for shares of Regeneration Technologies common stock.

The trading price of shares of Regeneration Technologies common stock after the merger may be affected by factors different from those affecting the price of shares of Regeneration Technologies common stock or shares of Tutogen common stock before the merger.

When we complete the merger, holders of Tutogen common stock will become holders of Regeneration Technologies common stock. The results of operations of Regeneration Technologies, as well as the trading price of Regeneration Technologies common stock, after the merger may be affected by factors different from those currently affecting Regeneration Technologies’ or Tutogen’s results of operations and the trading price of Tutogen common stock. For a discussion of the businesses of Regeneration Technologies and Tutogen and of certain factors to consider in connection with these businesses, see the documents incorporated by reference into this Proxy Statement and referred to under “Where You Can Find More Information” beginning on page 107.

Risks Relating to the Business of the Combined Company

Regeneration Technologies and Tutogen depend heavily upon a limited number of sources of human tissue, and any failure to obtain tissue from these sources in a timely manner will interfere with the combined company’s ability to process and distribute allografts.

The limited supply of human tissue has at times limited the growth of Regeneration Technologies and Tutogen, and may not be sufficient to meet future needs of the combined company. In addition, due to seasonal changes in mortality rates, some scarce tissues that Regeneration Technologies and Tutogen currently use for their allografts are at times in particularly short supply. Other factors, some of which are unpredictable, such as negative publicity and regulatory actions in the industry in which the combined company will operate also could unexpectedly reduce the available supply of tissue.

Regeneration Technologies and Tutogen rely on donor recovery groups for their human tissue supplies. Donor recovery groups are part of relatively complex relationships. They provide support to donor families, are regulated by the FDA, and are often affiliated with hospitals, universities or organ procurement organizations. The relationships of the combined company with donor recovery groups, which will be critical to its supply of tissue, could be affected by relationships recovery groups have with other organizations. Any negative impact of the regulatory and disease transmission issues facing the industry, as well as the negative publicity that these issues create, could have an impact on the ability of the combined company to negotiate favorable contracts with recovery groups.

Regeneration Technologies’ four largest donor recovery groups together recovered for the year ended December 31, 2006 and the nine months ended September 30, 2007, approximately 48% and 50%, respectively of its total tissue supply. Southeast Tissue Alliance, or SETA (formerly the University of Florida Tissue Bank, Inc.), supplied Regeneration Technologies for the year ended December 31, 2006, and the nine months ended September 30, 2007, with approximately 22% and 15%, respectively, of its total tissue. RTI Donor Services, Inc. supplied Regeneration Technologies for the year ended December 31, 2006, and the nine months ended September 30, 2007, with approximately 11% and 17%, respectively, of its total tissue. Alabama Organ Center supplied Regeneration Technologies for the year ended December 31, 2006, and the nine months ended September 30, 2007, with approximately 10% and 9%, respectively, of its total tissue. Dialysis Clinic, Inc., supplied Regeneration Technologies for the year ended December 31, 2006, and the nine months ended September 30, 2007, with approximately 5% and 10%, respectively, of its total tissue. For the years ended September 30, 2006, and 2007, Tutogen recovered 65% and 37%, respectively, of its tissue supply from Allosource, Inc. We expect the merger to reduce the dependence of the combined company on each of these

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companies. Nevertheless, if the combined company were to lose any one of these sources of tissue, the impact on operating results of the combined company would be material.

Regeneration Technologies and Tutogen cannot be sure that the supply of human tissue will continue to be available at current levels or will be sufficient to meet the needs of the combined company. If the combined company is not able to obtain tissue from current sources of Regeneration Technologies and Tutogen sufficient to meet its needs, the combined company may not be able to locate additional replacement sources of tissue on commercially reasonable terms, if at all. Any interruption of the business of the combined company caused by the need to locate additional sources of tissue would significantly hurt its revenues. Regeneration Technologies and Tutogen expect that revenues of the combined company would decline in proportion to any decline in tissue supply.

If Regeneration Technologies and Tutogen fail to maintain their existing strategic relationships or are unable to identify distributors of the combined company’s implants, revenues may decrease.

Regeneration Technologies currently derives the majority of its revenues through its relationships with two companies, Medtronic Sofamor Danek, or MSD, and Exactech, Inc. For the year ended December 31, 2006, and the nine months ended September 30, 2007, Regeneration Technologies derived approximately 54% and 49% and 6% and 6% of its revenues from distribution by MSD and Exactech, respectively. Tutogen currently derives the majority of its revenues through relationships with two companies, Zimmer Dental, Inc. and Zimmer Spine, Inc. For the year ended September 30, 2007, Tutogen derived approximately 48% and 10% of its consolidated revenues from distribution by Zimmer Dental and Zimmer Spine, respectively. In addition, MSD and Zimmer provide nearly all of the instrumentation, surgeon training, distribution assistance and marketing materials for the lines of allografts they distribute for Regeneration Technologies and Tutogen, respectively.

Variations in the timing and volume of orders by MSD and Zimmer may have a material effect upon the revenues of the combined company. We expect the merger to reduce the dependence of the combined company on each of these companies. Nevertheless, if the relationships with MSD or Zimmer are terminated or reduced for any reason and the combined company is unable to replace these relationships with other means of distribution, the combined company could suffer a material decrease in revenues.

The combined company may need to obtain the assistance of additional distributors to market and distribute new allografts and technologies, as well as to market and distribute its existing allografts and technologies to new market segments or geographical areas. The combined company may not be able to find additional distributors who will agree to and successfully market and distribute its allografts and technologies on commercially reasonable terms, if at all. If the combined company is unable to establish additional distribution relationships on favorable terms, its revenues may decline.

If third-party payors fail to provide appropriate levels of reimbursement for the use of the combined company’s implants, revenues could be adversely affected.

Political, economic and regulatory influences are subjecting the healthcare industry in the United States to fundamental change. Any new federal or state legislation could result in significant changes in the availability, delivery, pricing or payment for healthcare services and products. While we cannot predict what form any new legislation will take, it is possible that any significant healthcare legislation, if adopted, could adversely affect amounts paid to the combined company for its services, which could have a negative impact on the revenues of the combined company.

The revenues of the combined company will likely depend largely on the reimbursement of patients’ medical expenses by government health care programs and private health insurers. Governments and private insurers closely examine medical procedures incorporating new technologies to determine whether the procedures will be covered by payment, and if so, the level of payment which may apply. We cannot be sure that third-party payors will reimburse the combined company at the current levels.

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If the combined company fails to maintain the high processing standards that implants require or if the combined company is unable to develop processing capacity as required, its commercial opportunity will be reduced or eliminated.

Implants of the combined company will require careful calibration and precise, high-quality processing. Achieving precision and quality control will require skill and diligence by the combined company’s personnel. If the combined company fails to achieve and maintain these high processing standards, including avoiding processing errors, design defects or component failures:

Further, to be successful, the combined company will need to manage its human tissue processing capacity related to tissue recovery and demand for its allografts. It may be difficult for the combined company to match its processing capacity to demand due to problems related to yields, quality control and assurance, tissue availability, adequacy of control policies and procedures, and lack of skilled personnel. If the combined company is unable to process and produce its implants on a timely basis, at acceptable quality and costs, and in sufficient quantities, or if the combined company experiences unanticipated technological problems or delays in processing, it will reduce revenues and increase the combined company’s cost per allograft processed.

The allograft and xenograft implants and technologies of the combined company could become subject to significantly greater regulation by the FDA, which could disrupt its business.

The FDA and several states have statutory authority to regulate allograft processing and allograft-based materials. The FDA could identify deficiencies in future inspections of the facilities of the combined company or its suppliers or promulgate future regulatory rulings that could disrupt the business of the combined company, hurting its profitability.

For example, in mid-2001, the FDA reviewed the Regeneration Technologies BioCleanse ^® process after the FDA raised concerns about the process. While the FDA concluded that the compliance portion of its review of Regeneration Technologies’ BioCleanse ^® process in January 2002 and determined Regeneration Technologies was in compliance with existing FDA requirements and that no regulatory action was warranted, the possibility always exists that the FDA could raise concerns with these or other aspects of the business of Regeneration Technologies. The FDA’s decision, that no regulatory action was warranted, does not constitute a formal approval of the Regeneration Technologies BioCleanse ^® process and the FDA is free to raise the same or similar concerns in the future.

If any of the combined company’s allografts fall under the FDA’s definitions of “more than minimally manipulated or indicated for nonhomologous use,” the combined company would be required to obtain medical device approval or clearance or biologics licenses, which could require clinical testing. Disapproval of the combined company’s license applications and restricted distribution of any of the combined company’s allografts, which may become subject to pre-market approval, may result. The FDA could require post-market testing and surveillance to monitor the effects of such allografts, could restrict the commercial applications of these allografts, and could conduct periodic inspections of the facilities of the combined company and its suppliers. Delays encountered during the FDA approval process could shorten the patent protection period during which the combined company has the exclusive right to commercialize such technologies or could allow others to come to market with similar technologies before the combined company.

FDA regulations of human cellular and tissue-based products, titled “Good Tissue Practices,” became effective as of May 2005. These regulations cover all stages of allograft processing, from procurement of tissue

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to distribution of final allografts. These regulations may increase regulatory scrutiny within the industry in which the combined company will operate and lead to increased enforcement action which affects the conduct of the combined company’s business. In addition, these regulations may have a significant effect upon recovery agencies which supply the combined company with tissue and increase the cost of recovery activities. Any such increase would translate into increased costs to the combined company, as we expect the combined company to reimburse the recovery agencies based on their cost of recovery.

Other regulatory entities include state agencies with statutes covering tissue banking. Of particular relevance to the business of the combined company will be the regulations issued by Florida, New York, California and Maryland. Most states do not currently have tissue banking regulations. However, recent incidents of allograft related infections in the industry may stimulate the development of regulation in other states. It is possible that others may make allegations against the combined company or against donor recovery groups or tissue banks, including those with which Regeneration Technologies and Tutogen have relationships, about non-compliance with applicable FDA regulations or other relevant statutes and regulations. Allegations like these could cause regulators or other authorities to take investigative or other action, or could cause negative publicity for the combined company’s business and the industry in which it will operate.

Some of the combined company’s implants in development will contain tissue derived from animals, commonly referred to as xenografts. Xenograft implants are medical devices that are subject to pre-market approval or clearance by the FDA. Regeneration Technologies received FDA clearance on several xenograft implants in 2005 and 2006. However, the combined company may not receive FDA approval or clearance to market new implants as it attempts to expand the quantity of xenograft implants available for distribution.

The allograft industry is subject to additional local, state, federal and international government regulations and any increased regulations of the activities of the combined company could significantly increase the cost of doing business, thereby reducing profitability.

Some aspects of the anticipated business of the combined company are subject to additional local, state, federal or international regulation. Changes in the laws or new interpretations of existing laws could negatively affect the business, revenues or prospects of the combined company, and increase the costs associated with conducting its business. In particular, the procurement and transplantation of allograft tissue is subject to federal regulation under the National Organ Transplant Act, or NOTA, a criminal statute that prohibits the purchase and sale of human organs, including bone and other tissue. NOTA permits the payment of reasonable expenses associated with the transportation, processing, preservation, quality control and storage of human tissue, which are the types of services the combined company will perform. If in the future NOTA were amended or interpreted in a way that made the combined company unable to include some of these costs in the amounts it could charge its customers, it could reduce the revenues of the combined company and therefore hurt its business. It is possible that more restrictive interpretations or expansions of NOTA could be adopted in the future which could require the combined company to change one or more aspects of its business, at a substantial cost, in order to continue to comply with this statute.

A variety of additional local, state, federal and international government laws and regulations will govern the business of the combined company, including those relating to the storage, handling, generation, manufacture and disposal of medical wastes from the processing of tissue. If the combined company fails to conduct its business in compliance with these laws and regulations, it could be subject to significant liabilities arising from hazardous biological materials for which its insurance may not be adequate. Moreover, such insurance may not always be available in the future on commercially reasonable terms, if at all. If the combined company’s insurance proves to be inadequate to pay a damage award, it may not have sufficient funds to do so, which could harm its financial condition and liquidity.

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The success of the combined company will depend on the continued acceptance of the allograft and xenograft implants and technologies of Regeneration Technologies and Tutogen by the medical community.

New allograft and xenograft implants, technologies or enhancements to existing implants of Regeneration Technologies and Tutogen may never achieve broad market acceptance, which can be affected by numerous factors, including:

Market acceptance will also depend on the combined company’s ability to demonstrate that its existing and new implants and technologies are an attractive alternative to existing tissue repair treatment options. The ability of the combined company to do so will depend on surgeons’ evaluations of the clinical safety, efficacy, ease of use, reliability and cost-effectiveness of these tissue repair options and technologies. For example, we believe that some in the medical community have lingering concerns over the risk of disease transmission through the use of allografts.

Furthermore, we believe that even if the medical community generally accepts the combined company’s implants and technologies, recommendations and endorsements by influential surgeons will be important to their broad commercial success. If the combined company’s implants and technologies are not broadly accepted in the marketplace, it may not achieve a competitive position in the market.

Rapid technological changes will adversely affect the combined company and its customers, which could result in reduced demand for its products.

Technologies change rapidly in the industry in which Regeneration Technologies and Tutogen operate. For example, steady improvements have been made in synthetic human tissue substitutes which compete with the tissue implants of Regeneration Technologies and Tutogen. Unlike allografts, synthetic tissue technologies are not dependent on the availability of tissue. If one of the competitors of the combined company successfully introduces synthetic technologies using recombinant technologies, which stimulate the growth of tissue surrounding an implant, it could result in a decline in demand for tissue implants. The combined company may not be able to respond effectively to technological changes and emerging industry standards, or to successfully identify, develop or support new technologies or enhancements to existing implants in a timely and cost-effective manner, if at all. If the combined company is unable to achieve the improvements in its implants necessary for their successful commercialization, the demand for the combined company’s implants will suffer.

The combined company will face intense competition, which could result in reduced acceptance and demand for its implants and technologies.

The medical technology/biotechnology industry is intensely competitive. The combined company will compete with companies in the United States and internationally that engage in the development and production of medical technologies and processes including:

Many of the competitors of the combined company will have much greater financial, technical, research, marketing, distribution, service and other resources than the combined company. Moreover, competitors of the

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combined company may offer a broader array of tissue repair treatment products and technologies or may have greater name recognition than the combined company in the marketplace. For example, the combined company will likely compete with a number of divisions of Johnson & Johnson, a company with significantly greater resources and brand recognition than the combined company. The competitors of the combined company, including several development stage companies, may develop or market technologies that are more effective or commercially attractive than the combined company’s technologies, or that may render the combined company’s technologies obsolete. For example, the successful development of a synthetic tissue product that permits remodeling of bones could result in a decline in the demand for allograft and xenograft-based products and technologies.

If the combined company does not manage the medical release of donor tissue into processing in an effective and efficient manner, it could adversely affect profitability.

Many factors affect the level and timing of donor medical releases, such as effectiveness of donor screening currently performed by donor recovery groups, the timely receipt, recording and review of required medical documentation, and employee loss and turnover in the combined company’s medical records department. Some of the combined company’s donor recovery groups are also processors who provide partially processed tissues which they have already determined to be medically suitable for processing. Therefore, these sources provide a higher level of documentation than those that perform donor recovery alone. We can provide no assurance that donor medical releases will occur at levels which will maximize the combined company’s processing efficiency and minimize its cost per allograft processed.

Negative publicity concerning methods of human tissue recovery and screening of donor tissue in the industry in which the combined company will operate could reduce demand for its allografts and impact the supply of available donor tissue.

Media reports or other negative publicity concerning both improper methods of tissue recovery from donors and disease transmission from donated tissue could limit widespread acceptance of the combined company’s allografts. Unfavorable reports of improper or illegal tissue recovery practices, both in the United States and internationally, as well as incidents of improperly processed tissue leading to transmission of disease, may broadly affect the rate of future tissue donation and market acceptance of allograft technologies.

Potential patients may not be able to distinguish the combined company’s allografts, technologies and the tissue recovery and the processing procedures from those of its competitors or others engaged in tissue recovery. In addition, families of potential donors may become reluctant to agree to donate tissue to for-profit tissue processors.

If the combined company’s patents and the other means it uses to protect its intellectual property prove to be inadequate, its competitors could exploit its intellectual property to compete more effectively against it.

The law of patents and trade secrets is constantly evolving and often involves complex legal and factual questions. The U.S. government may deny or significantly reduce the coverage the combined company seeks in its patent applications before or after a patent is issued. We therefore cannot be sure that any particular patent for which the combined company applies will be issued, that the scope of the patent protection will be comprehensive enough to provide adequate protection from similar technologies which may compete with those of the combined company, that interference proceedings regarding any of the combined company’s patent applications will not be filed, or that the combined company will achieve any other competitive advantage from a patent. In addition, it is possible that one or more of the combined company’s patents will be held invalid if challenged or that others will claim rights in or ownership of the combined company’s patents and other proprietary rights. If any of these events occur, competitors of the combined company may be able to use its intellectual property to compete more effectively against it.

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Because patent applications are secret until patents are actually issued (or until 18 months after a patent application has been filed) and the publication of discoveries in the scientific or patent literature lags behind actual discoveries, the combined company cannot be certain that its patent application was the first application filed covering a particular invention. If another party’s rights to an invention are superior to those of the combined company, the combined company may not be able to obtain a license to use that party’s invention on commercially reasonable terms, if at all. In addition, competitors of the combined company, many of which will have greater resources than the combined company, could obtain patents that will prevent, limit or interfere with the combined company’s ability to make use of its inventions either in the United States or in international markets. Further, the laws of some foreign countries will not always protect the combined company’s intellectual property rights to the same extent as the laws of the United States. Litigation or regulatory proceedings in the United States or foreign countries also may be necessary to enforce the combined company’s patent or other intellectual property rights or to determine the scope and validity of the proprietary rights of its competitors. These proceedings can be costly, result in development delays, and divert the attention of the combined company’s management from its business.

Regeneration Technologies and Tutogen rely upon unpatented proprietary techniques and processes in tissue recovery, research and development, tissue processing and quality assurance. It is possible that others will independently develop technology similar to technology of the combined company or otherwise gain access to or disclose its proprietary technologies. The combined company may not be able to meaningfully protect its rights in these proprietary technologies, which would reduce its ability to compete.

The combined company’s success will depend in part on its ability to operate without infringing on or misappropriating the proprietary rights of others, and if the combined company is unable to do so it may be liable for damages.

We cannot be certain that U.S. or foreign patents or patent applications of other companies do not exist or will not be issued that would prevent the combined company from commercializing its allografts and technologies. Third parties may sue the combined company for infringing or misappropriating their patent or other intellectual property rights. Intellectual property litigation is costly. If the combined company does not prevail in litigation, in addition to any damages it might have to pay, it could be required to stop the infringing activity or obtain a license requiring it to make royalty payments. It is possible that a required license will not be available to the combined company on commercially acceptable terms, if at all. In addition, a required license may be non-exclusive, and therefore competitors of the combined company may have access to the same technology licensed to the combined company. If the combined company fails to obtain a required license or is unable to design around another company’s patent, it may be unable to make use of some of the affected technologies or distribute the affected allografts which would negatively impact its revenues.

The defense costs and settlements for patent infringement lawsuits are not covered by insurance. Patent infringement lawsuits can take up to several years to settle. If the combined company is not successful in its defenses or is not successful in obtaining dismissals of any such lawsuit, legal fees or settlement costs could have a material adverse effect on the quarterly results of operations and the financial position of the combined company.

On September 11, 2006, Osteotech, Inc. filed a lawsuit in the United States District Court for the District of New Jersey claiming infringement of one of their patents by Regeneration Technologies’ BioCleanse ^® process. The suit requests (i) that Regeneration Technologies be enjoined permanently from infringing the patent, (ii) damages, along with treble damages as a result of alleged willful infringement, and (iii) reimbursement of costs and expenses and reasonable attorney fees. Although Regeneration Technologies believes the suit is without merit and will vigorously defend its position, a finding of infringement would have a material adverse effect upon its revenues.

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The combined company or its competitors may be exposed to product or professional liability claims which could cause it to be liable for damages or cause investors to think the combined company will be liable for similar claims in the future.

The development of allografts and technologies for human tissue repair and treatment entails an inherent risk of product or professional liability claims, and substantial product or professional liability claims may be asserted against the combined company. Regeneration Technologies and Tutogen are parties to a number of legal proceedings relating to product liability.

The implantation of donated human tissue products creates the potential for transmission of communicable disease. Although we comply with Federal and state regulations and guidelines intended to prevent communicable disease transmission, and our tissue suppliers are also required to comply with such regulations, there can be no assurances that: (i) our tissue suppliers will comply with such regulations intended to prevent communicable disease transmissions; (ii) even if such compliance is achieved, that our products have not been or will not be associated with transmission of disease; or (iii) a patient otherwise infected with disease would not erroneously assert a claim that the use of our products resulted in disease transmission.

Regeneration Technologies currently has $20 million of product liability insurance and $10 million of professional liability insurance and Tutogen currently has $5 million of product liability insurance to cover claims. This amount of insurance may not be adequate for current claims if we are not successful in our defenses, and furthermore, we may not have adequate insurance coverage for any future claims that arise. Moreover, insurance covering the business of the combined company may not always be available in the future on commercially reasonable terms, if at all. If our insurance proves to be inadequate to pay a damage award, we may not have sufficient funds to do so, which would harm our financial condition and liquidity. In addition, successful product liability claims made against one of our competitors could cause claims to be made against us or expose us to a perception that we are vulnerable to similar claims. Claims against us, regardless of their merit or potential outcome, may also hurt our ability to obtain surgeon endorsement of our allografts or to expand our business.

Regeneration Technologies has been named as a party, along with a number of other defendants, in product liability lawsuits relating to the recall of tissue recovered by Biomedical Tissue Service, Ltd., an unaffiliated recovery agency (“BTS”). There have been 825 law suits filed related to the recall, of which 12 law suits have been dismissed. On October 20, 2006, Regeneration Technologies filed a joint motion to dismiss the claims based on scientific evidence that it is impossible for sterilized tissue to transmit infections to implant recipients. These lawsuits generally allege that Regeneration Technologies was negligent in not discovering deficiencies in recovery practices at BTS and include related claims for matters such as misrepresentation and breach of warranty. Where specific damages have been identified, the actions seek compensatory damages in ranges of $15,000 to $5 million and punitive damages in ranges of $75,000 to $10 million.

Tutogen has been named as one of the several defendants in a class action suit related to the BTS recall and in a number of lawsuits related to the recall.

We believe that we have meritorious defenses to these claims, and are defending them vigorously. In addition, we believe Regeneration Technologies’ and Tutogen’s existing insurance should cover all litigation expenses and damage awards, if any. However, the existing insurance coverage may not be adequate if we are not successful in our defenses and certain lawsuits may not be eligible for such insurance coverage. If we are not successful in our defenses to lawsuits not covered by insurance the legal fees, or if existing insurance coverage is not adequate, the legal fees and settlements for such lawsuits could have a material adverse effect on quarterly results of operations and the financial position of the combined company.

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If the combined company is not successful in expanding its distribution activities into international markets, it will not be able to pursue one of its planned strategies for increasing its revenues.

The planned international distribution strategies of the combined company vary by market, as well as within each country in which it will operate. For example, Regeneration Technologies distributes only a portion of its line of allograft and xenograft products within each country. The combined company’s international operations will be subject to a number of risks which may vary from the risks the combined company faces in the United States, including: