disruption to soft tissue and support structures

Exhibit 10.6

EXHIBIT A

LEGAL DESCRIPTION

(2.15 AC) LT 31 SEC 20 LANDMARK INDUSTRIAL PARK

EXHIBIT B

Term:		The effective date of this Lease shall be the date on which the Lease is executed by both parties. The rent commencement date shall be, one (1) week after the certificate of occupancy is received, one hundred days (100) days after up-fit begins, or at tenant occupancy, whichever is earlier. The initial term shall be 60 months from the date of rent commencement.
		Tenant, at its sole discretion, shall be able to terminate the lease after month thirty-six (36), provided a one-hundred and twenty (120) day notice is given to the Landlord.

Year		Date				(Illegible)				(Illegible)
Year 1			05/01/05 - 04/30/06			$	145,632			$	12,136
Year 2			05/01/06 - 04/30/07			$	150,000			$	12,500
Year 3			05/01/07 - 04/30/08			$	154,500			$	12,875
Year 4			05/01/08 - 04/30/09			$	159,136			$	13,261
Year 5			05/01/09 - 04/30/10			$	163,910			$	13,659
						(Illegible)

Renewal Options:		Two (2), three (3) year renewal options.
Annual Increase:		Three percent (3.00%) per year for Years 1 through Year 5, continuing through the option periods

EXHIBIT C

Alterations

13. Tenant shall not make any alterations, additions, or improvements to the premises without the landlord’s prior written consent. Tenant shall promptly remove any alterations, additions, or improvements constructed in violation of this paragraph upon landlord’s written request which shall not be unreasonably withheld, conditional or delayed. All approved alterations, additions, or improvements will be accomplished in a good and workman like manner, in conformity with all applicable laws and regulations, and by a contractor approved by the landlord, free of any liens or encumbrances. Landlord may require tenant to remove any alterations, additions or improvements (whether or not made with landlord’s consent) at the termination of the lease and to restore the premises to its prior condition, all at tenant’s expense. All alterations, addition and improvements which landlord has not required tenant to remove shall become landlords property and, except as otherwise provided in paragraph 14, shall be surrendered to the landlord upon the termination of this lease, except that the tenant may remove any of the tenants machinery or equipment that can be removed without any material damage to the premises. Tenant shall repair, a tenants expense, any damage to the premises caused by removal of any such machinery or equipment.

EXHIBIT D

Special Stipulations

l. Notwithstanding anything to the contrary contained in this Lease, Tenant shall be permitted to assign this Lease, without the consent of Landlord, (i) to a corporation into which Tenant may merge, which Tenant may acquire, or which Tenant may consolidate with, (ii) to any parent or subsidiary of Tenant, or (iii) to a purchaser of substantially all of Tenant’s assets or a controlling interest in the outstanding voting stock of Tenant.

2. Notwithstanding anything to the contrary contained in this Lease, with respect to any default of Tenant under this Lease (other than the nonpayment of rental) which cannot reasonably be cured within thirty (30) days but which is curable, Tenant’s cure period relative to such default shall be extended for such additional period as may be reasonably required to cure such default, as long as Tenant has promptly commenced such cure within thirty (30) days after written notice of the default from Landlord and thereafter diligently prosecutes such cure to completion.

3. If Landlord fails to perform or observe any of the terms, covenants or conditions contained in this Lease on its part to be performed or observed within thirty (30) days after written notice of default from Tenant, cure failure shall constitute a default by Landlord under this Lease. In the event of a default by Landlord hereunder, Tenant shall be entitled to (i) cure such default of Landlord by performing the relevant obligations of Landlord on Landlord’s behalf, in which case Landlord shall reimburse Tenant, within thirty (30) days of receiving an invoice from Tenant for such costs, for all costs expended by Tenant in performing such obligations and/or (ii) pursue all other remedies available to Tenant, at law or in equity, as a result of such default. In the event Tenant proceeds under clause (i) above and is not reimbursed in full for its costs within thirty (30) days of its delivery of an invoice to Landlord. Tenant shall be entitled to offset the amount of such unreimbursed costs against the amounts next due and payable under this Lease.

4. Tenant agrees that this Lease shall at all times be subject and subordinate to the lien of any mortgage (which term shall include all corresponding security instruments) that encumbers the Premises; and Tenant agrees, upon demand, without cost to Tenant, to execute any reasonable instrument as may be required to effectuate such subordination. Provided however, as a condition to the subordination described in this Paragraph 4, Landlord shall obtain from any mortgagee an agreement in writing, which shall be delivered to Tenant, providing in substance that (i) so long as Tenant shall faithfully discharge the obligations on its part to be kept and performed under the term of this Lease. Tenant’s right to occupy and use the Premises shall not be disturbed, nor shall this Lease be affected by any default under such mortgage, and (ii) in the event of foreclosure or my enforcement of any such mortgage, the rights of Tenant hereunder shall expressly survive and this Lease shall in all respects continue in full force and effect (provided Tenant continues to perform its obligations hereunder).

6 Landlord hereby represents that to the best of its knowledge and belief, no Hazardous Materials currently exist on the Property or previously existed on the Property in violation of applicable governmental regulation.

7 Landlord and Tenant represent and warrant each to the other that they have not dealt with any broker(s) or any other person claiming any entitlement to any commission in connection with this transaction other than _________ (“Broker”). Landlord shall be responsible for paying any commission or fee due to Broker. Landlord and Tenant agree to indemnify and save each other harmless from and against any and all claims, suits, liabilities, costs, judgments and expenses, including reasonable attorney’s fees, for any leading commissions or other commissions, fees, charges or payments resulting from or arising out of their respective actions in connection with this Lease (provided that Tenant’s indemnity of Landlord shall exclude any commission or fee due to Broker).

Landlord:	Elmore Enterprises, Inc.
	By:	s/ W. Keith Elmore
		Name:	W. Keith Elmore
		Title:	Manager

Tenant:	TRANS1 INC., a Delaware corporation
	By:	/s/ Robert Assell
		Name:	Robert Assell
		Title:	VP, PRODUCT DEVELOPMENT

EXHIBIT E

MEMORANDUM OF LEASE

     KNOW ALL PERSONS BY THESE PRESENTS, that for and in consideration of the rents and covenants set forth in a certain Commercial Lease Agreement dated 3/16/, 2005 (the “Lease”), by and between Elmore Enterprises, Inc., having a mailing address of 411 Landmark Dr, Wilmington, NC 28412, as Landlord (“Landlord”), and Trans1, Inc, a _________ corporation with an office at 1800 Sir Tyler Drive, Suite 101, Wilmington, NC 28405, as Tenant (“Tenant”, Landlord has leased to Tenant that certain property described on Exhibit A attached hereto and incorporated herein by reference (together with all improvements thereon, the “Premises”).

     Pursuant to the terms of the Lease, Landlord has leased the Premises to Tenant for an initial term of ______ (___) years beginning on See Lease, 2005, and terminating on _________, 20___. The provisions set forth in the Lease are hereby incorporated in this Memorandum as though stated herein in full.

     IN WITNESS WHEREOF, the Landlord has duly executed this instrument as of this 24^th day of March, 2005

STATE OF NORTH CAROLINA

COUNTY OF NEW HANOVER

[insert appropriate acknowledgement]

     WITNESS my hand and official seal this 24^th day of March, 2005.

My Commission Expires:

April 12, 2009

(SEAL)