Exhaust fitting

I'm re-fitting the stock exhaust to my curvy SV, collector and all. The exhaust I have is a used part I managed to scrounge from a breakers a short while ago. As I was about to fit, I noticed where the collector attaches to the downpipe at the front of the bike there were a few small cracks in the exhaust pipe, so much so that one small part of the pipe is moveable (bends) with little effort. Inside the pipe is some sort of heat resistant material.Now I've never had cause to worry about exhausts too much so my knowledge is rather thin on the ground here. Would I expect that on a 10yr old exhaust? Is the material supposed to be there? I'm quite confused here!

Just noticed this could have done with being in the "SV talk" section - appologies.