Exhibit 10.1

OMNIBUS NINTH Amendment to AMENDED AND RESTATED CREDIT, SECURITY AND GUARANTY
AGREEMENT AND LIMITED CONSENT UNDER INTERCREDITOR AGREEMENT

 

This NINTH AMENDMENT TO AMENDED AND RESTATED CREDIT, SECURITY AND GUARANTY
AGREEMENT (this “Agreement”) is made as of this 27th day of March, 2019, by and
among ALPHATEC HOLDINGS, INC., a Delaware corporation (“Alphatec Holdings”),
ALPHATEC SPINE, INC., a California corporation (“Alphatec Spine”), SafeOp
Surgical, Inc., a Delaware corporation (“SafeOp”; together with Alphatec
Holdings and Alphatec Spine, each being referred to herein individually as a
“Borrower”, and collectively as “Borrowers”), MIDCAP FUNDING IV TRUST (as Agent
for Lenders, “Agent”), and MIDCAP FUNDING IV TRUST, individually, as a Lender,
and the other financial institutions or other entities from time to time parties
to the Credit Agreement referenced below, each as a Lender.

RECITALS

A.Agent, Lenders and Borrowers are parties to that certain Amended and Restated
Credit, Security and Guaranty Agreement, dated as of August 30, 2013, as amended
by the First Amendment to Amended and Restated Credit, Security and Guaranty
Agreement, dated as of March 17, 2014, the Second Amendment to Amended and
Restated Credit, Security and Guaranty Agreement, dated as of July 10, 2015, the
Third Amendment and Waiver to Amended and Restated Credit, Security and Guaranty
Agreement, dated as of March 11, 2016, by the Fourth Amendment and Waiver to
Amended and Restated Credit, Security and Guaranty Agreement, dated as of August
9, 2016, by the Consent and Fifth Amendment to Amended and Restated Credit,
Security and Guaranty Agreement, dated as of September 1, 2016, by the Sixth
Amendment to Amended and Restated Credit, Security and Guaranty Agreement, dated
as of March 30, 2017, by the Consent, Joinder and Omnibus Seventh Amendment to
Amended and Restated Credit, Security and Guaranty Agreement, dated as of March
8, 2018 and by the Eighth Amendment to Amended and Restated Credit, Security and
Guaranty Agreement, dated as of November 6, 2018 (and as further amended,
modified, supplemented and restated from time to time prior to the date hereof,
the “Original Credit Agreement” and as the same is amended hereby and as it may
be further amended, modified, supplemented and restated from time to time, the
“Credit Agreement”), pursuant to which the Lenders have agreed to make certain
advances of money and to extend certain financial accommodations to Borrowers
and certain of their Affiliates in the amounts and manner set forth in the
Credit Agreement.

 

B.Agent, Squadron Medical Finance Solutions, LLC (“Squadron”), and Borrowers are
party to that certain Intercreditor Agreement, dated as of November 6, 2018,
pursuant to which Squadron may not increase the aggregate principal amount of
the Squadron Debt (as defined in the Credit Agreement), without the prior
written consent of Agent.

 

C.Borrowers have requested, and Agent and the Lenders have agreed, (i) to amend
the Original Credit Agreement and (ii) consent under the Squadron Intercreditor
Agreement (as defined in the Credit Agreement), in each case, to permit
Borrowers to enter into an amendment to the Squadron Credit Agreement (as
defined in the Credit Agreement) (the “First Amendment”) and to increase the
aggregate principal amount of the Debt thereunder to $65,000,000, all on the
terms and conditions set forth herein.

 

 

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AGREEMENT

NOW, THEREFORE, in consideration of the foregoing, the terms and conditions set
forth in this Agreement, and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, Agent, the Lenders and
Borrowers hereby agree as follows:

1.Recitals.  This Agreement shall constitute a Financing Document and the
Recitals and each reference to the Credit Agreement in the Original Credit
Agreement, unless otherwise expressly noted, will be deemed to reference the
Credit Agreement as amended hereby.  The Recitals set forth above shall be
construed as part of this Agreement as if set forth fully in the body of this
Agreement and capitalized terms used but not otherwise defined herein shall have
the meanings ascribed to them in the Original Credit Agreement (including those
capitalized terms used in the Recitals hereto).

2.Limited Consent Under Intercreditor Agreement.  At the request of and as an
accommodation to the Borrowers, subject to the terms and conditions set forth
herein, including without limitation, the terms set forth in Section 6, Agent
and Lenders, (a) notwithstanding anything contained in Section 4.2(v) of the
Squadron Intercreditor Agreement to the contrary, hereby consent to the First
Amendment, dated as of the date hereof, pursuant to which the maximum principal
amount of the Squadron Debt shall be increased to $65,000,000.  The consents set
forth in this Section 2 are effective solely for the purposes set forth herein
and shall be limited precisely as written and shall not be deemed to (a) be a
consent to any amendment, waiver or modification of any other term or condition
of the Credit Agreement, the Squadron Intercreditor Agreement or any other
Financing Document; (b) prejudice any right that Agent or Lenders have or may
have in the future under or in connection with the Credit Agreement, the
Squadron Intercreditor Agreement or any other Financing Document; (c) constitute
a consent to or waiver of any past, present or future Default or Event of
Default or other violation of any provisions of the Credit Agreement or any
other Financing Documents, (d) create any obligation to forbear from taking any
enforcement action, or to make any further extensions of credit or (e) establish
a custom or course of dealing among any of the Credit Parties, on the one hand,
or Agent or any Lender, on the other hand.

3.Amendment to Original Credit Agreement.  Subject to the terms and conditions
of this Agreement, including, without limitation, the conditions to
effectiveness set forth in Section 6 below, the definition of “Squadron Debt” in
Section 1.1 of the Original Credit Agreement thereof is hereby amended and
restated in its entirety to read as follows:

“Squadron Debt” means Debt incurred pursuant to and in accordance with the terms
of the Squadron Credit Agreement in a principal amount not to exceed
$65,000,000.

 

4.Representations and Warranties; Covenants; Reaffirmation of Security Interest.
Each Borrower hereby (a) confirms that all of the representations and warranties
set forth in the Credit Agreement are true and correct in all material respects
(without duplication of any materiality qualifier in the text of such
representation or warranty) with respect to such Borrower as of the date hereof
except to the extent that any such representation or warranty relates to a
specific date in which case such representation or warranty shall be true and
correct as of such earlier date, and (b) covenants to perform its respective
obligations under the Credit Agreement.  Each Borrower confirms and agrees that
all security interests and Liens granted to Agent continue in full force and
effect, and all Collateral remains free and clear of any Liens, other than
Permitted Liens.  Except as specifically provided in this Agreement, nothing
herein is intended to impair or limit the validity, priority or extent of
Agent’s security interests in and Liens on the Collateral.  Each Borrower
acknowledges and agrees that the Credit Agreement, the other Financing Documents
and this Agreement constitute the legal, valid and binding obligation of each
Borrower, and are enforceable against each Borrower in accordance with their
terms,

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except as the enforceability thereof may be limited by bankruptcy, insolvency or
other similar laws relating to the enforcement of creditors’ rights generally
and by general equitable principles.

5.Costs and Fees.  Borrowers shall be responsible for the payment of all
reasonable and documented out-of-pocket costs and fees of Agent’s counsel
incurred in connection with the preparation of this Agreement and any related
documents.  If Agent or any Lender uses in-house counsel for any of these
purposes, Borrowers further agree that the Obligations include reasonable
charges for such work commensurate with the fees that would otherwise be charged
by outside legal counsel selected by Agent or such Lender for the work
performed.

6.Conditions to Effectiveness.  This Agreement shall become effective as of the
date on which each of the following conditions has been satisfied:

(a)Borrowers shall have delivered to Agent this Agreement, duly executed by an
authorized officer of each Borrower;

(b)(i) Agent shall have received executed copies of the First Amendment and all
other schedules, documents or instruments and all other material ancillary
agreements, instruments and documents to be executed or delivered in connection
therewith and (ii) all conditions precedent (other than the effectiveness of
this Agreement) to the effectiveness of the First Amendment shall have been
satisfied or waived;

(c)all of the representations and warranties of Borrowers set forth in the
herein and in the other Financing Documents are true and correct in all material
respects (without duplication of any materiality qualifier in the text of such
representation or warranty) with respect to such Borrower as of the date hereof
except to the extent that any such representation or warranty relates to a
specific date in which case such representations and warranties were true and
correct in all material respects (without duplication of any materiality
qualifier in the text of such representation or warranty) on and as of such date
(and such parties’ delivery of their respective signatures hereto shall be
deemed to be its certification thereof);

(d)no Default or Event of Default shall exist under any of the Financing
Documents (and such parties’ delivery of their respective signatures hereto
shall be deemed to be its certification thereof);

(e)Borrower shall have delivered such other documents, information,
certificates, records, permits, and filings as the Agent may reasonably request;
and

(f)Agent shall have received from Borrowers all of the fees owing pursuant to
this Agreement.  

7.Release.  In consideration of the agreements of Agent and Lenders contained
herein and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, each Borrower, voluntarily,
knowingly, unconditionally and irrevocably, with specific and express intent,
for and on behalf of itself and all of its respective parents, subsidiaries,
affiliates, members, managers, predecessors, successors, and assigns, and each
of their respective current and former directors, officers, shareholders,
agents, and employees, and each of their respective predecessors, successors,
heirs, and assigns (individually and collectively, the “Releasing Parties”) does
hereby fully and completely release, acquit and forever discharge each of Agent,
Lenders, and each their respective parents, subsidiaries, affiliates, members,
managers, shareholders, directors, officers and employees, and each of their
respective predecessors, successors, heirs, and assigns (individually and
collectively, the “Released Parties”), of and from any and all actions, causes
of action, suits, debts, disputes, damages, claims, obligations, liabilities,
costs, expenses and demands of any kind whatsoever, at law or in equity, whether
matured or unmatured, liquidated or unliquidated, vested or contingent, choate
or inchoate, known or unknown that the Releasing Parties (or any of them) has
against the Released Parties or any of them

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(whether directly or indirectly), based in whole or in part on facts, whether or
not now known, existing on or before the Effective Date, that relate to, arise
out of or otherwise are in connection with: (i) any or all of the Financing
Documents or transactions contemplated thereby or any actions or omissions in
connection therewith or (ii) any aspect of the dealings or relationships between
or among any or all of the Borrowers, on the one hand, and any or all of the
Released Parties, on the other hand, relating to any or all of the documents,
transactions, actions or omissions referenced in clause (i) hereof.  Each
Borrower acknowledges that the foregoing release is a material inducement to
Agent’s and Lender’s decision to enter into this Agreement and agree to the
modifications contemplated hereunder, and has been relied upon by Agent and
Lenders in connection therewith.

8.No Waiver or Novation.  The execution, delivery and effectiveness of this
Agreement shall not, except as expressly provided in this Agreement, operate as
a waiver of any right, power or remedy of Agent, nor constitute a waiver of any
provision of the Credit Agreement, the Financing Documents or any other
documents, instruments and agreements executed or delivered in connection with
any of the foregoing.  Nothing herein is intended or shall be construed as a
waiver of any existing Defaults or Events of Default under the Credit Agreement
or other Financing Documents or any of Agent’s rights and remedies in respect of
such Defaults or Events of Default.  This Agreement (together with any other
document executed in connection herewith) is not intended to be, nor shall it be
construed as, a novation of the Credit Agreement.

9.Affirmation.  Except as specifically amended pursuant to the terms hereof,
each Borrower hereby acknowledges and agrees that the Credit Agreement and all
other Financing Documents (and all covenants, terms, conditions and agreements
therein) shall remain in full force and effect, and are hereby ratified and
confirmed in all respects by Borrowers.  Each Borrower covenants and agrees to
comply with all of the terms, covenants and conditions of the Credit Agreement
and the Financing Documents, notwithstanding any prior course of conduct,
waivers, releases or other actions or inactions on Agent’s or any Lender’s part
which might otherwise constitute or be construed as a waiver of or amendment to
such terms, covenants and conditions.  Each Borrower hereby agrees that (i) all
representations and warranties of Borrowers contained in the Original Credit
Agreement and the other Financing Documents are true and correct in all material
respects (without duplication of any materiality qualifier in the text of such
representation or warranty) as of the date hereof (and such parties’ delivery of
their respective signatures hereto shall be deemed to be its certification
thereof), except to the extent such representations and warranties expressly
relate to a specific date, in which case such representations and warranties
were true and correct in all material respects (without duplication of any
materiality qualifier in the text of such representation or warranty) on and as
of such date and (ii) no Default or Event of Default shall exist under any of
the Financing Documents (and each Borrower’s delivery of its signatures hereto
shall be deemed to be its certification thereof). In consideration of the
accommodations set forth herein, each Borrower hereby acknowledges, reaffirms,
confirms and ratifies its prior pledge and grant to Agent, for its benefit and
for the benefit of Lenders, a continuing general lien in, upon, and to the
personal property set forth on Schedule 9.1 of the Credit Agreement, pursuant to
the Credit Agreement, and expressly acknowledges that such lien and security
interest secures the Obligations.

10.Confidentiality. No Borrower will disclose the contents of this Agreement,
the Credit Agreement or any of the other Financing Documents to any third party
(including, without limitation, any financial institution or intermediary)
without Agent’s prior written consent, other than to Borrowers’ officers and
advisors on a need-to-know basis or as otherwise may be required by Law,
including to any court or regulatory agency having jurisdiction over such
Borrower.  Each Borrower agrees to inform all such persons who receive
information concerning this Agreement, the Credit Agreement and the other
Financing Documents that such information is confidential and may not be
disclosed to any other person except as may be required by Law, including to any
court or regulatory agency having jurisdiction over such Borrower.  

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11.Miscellaneous.

(a)Reference to the Effect on the Credit Agreement. Upon the effectiveness of
this Agreement, each reference in the Credit Agreement to “this Agreement,”
“hereunder,” “hereof,” “herein,” or words of similar import shall mean and be a
reference to the Credit Agreement, as amended by this Agreement.  Except as
specifically amended above, the Credit Agreement, and all other Financing
Documents (and all covenants, terms, conditions and agreements therein), shall
remain in full force and effect, and are hereby ratified and confirmed in all
respects by Borrowers.

(b)Incorporation of Credit Agreement Provisions.  The provisions contained in
Section 11.6 (Indemnification) and Article 12 of the Credit Agreement are
incorporated herein by reference to the same extent as if reproduced herein in
their entirety.

(c)GOVERNING LAW.  THIS AGREEMENT AND EACH OTHER FINANCING DOCUMENT, AND ALL
MATTERS RELATING HERETO OR THERETO OR ARISING THEREFROM (WHETHER SOUNDING IN
CONTRACT LAW, TORT LAW OR OTHERWISE), SHALL BE GOVERNED BY, AND SHALL BE
CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF MARYLAND,
WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES.

(d)WAIVER OF JURY TRIAL.  EACH BORROWER, AGENT AND THE LENDERS HEREBY
IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THE FINANCING DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED THEREBY AND AGREES THAT ANY SUCH ACTION OR PROCEEDING
SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY.  EACH BORROWER, AGENT AND
EACH LENDER ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO ENTER INTO
A BUSINESS RELATIONSHIP, THAT EACH HAS RELIED ON THE WAIVER IN ENTERING INTO
THIS AGREEMENT AND THE OTHER FINANCING DOCUMENTS, AND THAT EACH WILL CONTINUE TO
RELY ON THIS WAIVER IN THEIR RELATED FUTURE DEALINGS.  EACH BORROWER, AGENT AND
EACH LENDER WARRANTS AND REPRESENTS THAT IT HAS HAD THE OPPORTUNITY OF REVIEWING
THIS JURY WAIVER WITH LEGAL COUNSEL, AND THAT IT KNOWINGLY AND VOLUNTARILY
WAIVES ITS JURY TRIAL RIGHTS.

(e)Headings.  Section headings in this Agreement are included for convenience of
reference only and shall not constitute a part of this Agreement for any other
purpose.

(f)Counterparts.  This Agreement may be signed in any number of counterparts,
each of which shall be deemed an original and all of which when taken together
shall constitute one and the same instrument.  Delivery of an executed
counterpart of this Agreement by facsimile or by electronic mail delivery of an
electronic version (e.g., .pdf or .tif file) of an executed signature page shall
be effective as delivery of an original executed counterpart hereof and shall
bind the parties hereto.

(g)Entire Agreement.This Agreement constitutes the entire agreement and
understanding among the parties hereto and supersedes any and all prior
agreements and understandings, oral or written, relating to the subject matter
hereof.

(h)Severability.  In case any provision of or obligation under this Agreement
shall be invalid, illegal or unenforceable in any applicable jurisdiction, the
validity, legality and enforceability of the remaining provisions or
obligations, or of such provision or obligation in any other jurisdiction, shall
not in any way be affected or impaired thereby.

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(i)Successors/Assigns.  This Agreement shall bind, and the rights hereunder
shall inure to, the respective successors and assigns of the parties hereto,
subject to the provisions of the Credit Agreement and the other Financing
Documents.

[SIGNATURES APPEAR ON FOLLOWING PAGES]

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IN WITNESS WHEREOF, intending to be legally bound, and intending that this
document constitute an agreement executed under seal, the undersigned have
executed this Agreement under seal as of the day and year first hereinabove set
forth.

 

 

AGENT:

MIDCAP FUNDING IV TRUST, a Delaware statutory trust

By: Apollo Capital Management, L.P.,

its investment manager

 

By:Apollo Capital Management GP, LLC,

its general partner

 

 

By: __/s/ Maurice Amsellem_____________  (SEAL)

Name: Maurice Amsellem

Title:   Authorized Signatory

 

LENDERS

MIDCAP FUNDING IV TRUST, a Delaware statutory trust

By: Apollo Capital Management, L.P.,

its investment manager

 

By:Apollo Capital Management GP, LLC,

its general partner

 

 

By: ____/s/ Maurice Amsellem __________  (SEAL)

Name: Maurice Amsellem

Title:   Authorized Signatory

 

 

 

[Signatures Continue on Following Page]

 

 

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BORROWERS:ALPHATEC HOLDINGS, INC.,

a Delaware corporation

 

 

By: __/s/ Jeffrey G. Black __________ (SEAL)
Name:  Jeff Black
Title:    Chief Financial Officer

 

 

ALPHATEC SPINE, INC.,

a California corporation

 

 

By: ___/s/ Jeffrey G. Black __________ (SEAL)
Name:  Jeff Black
Title:    Chief Financial Officer

 

 

SAFEOP SURGICAL, INC.,

a Delaware corporation

 

 

By: ___/s/ Jeffrey G. Black __________ (SEAL)
Name:  Jeff Black
Title:    Chief Financial Officer