Exhibit 10.6

RTI SURGICAL, INC.

NONQUALIFIED STOCK OPTION AGREEMENT

FOR

JONATHON M. SINGER

1.    Grant of Option. RTI SURGICAL, INC., a Delaware corporation (the
“Company”) hereby grants, as of September 18, 2017 (“Date of Grant”), to
Jonathon M. Singer (the “Optionee”) an option (the “Option”) to purchase up to
306,900 shares of the Company’s common stock (the “Shares”), at an exercise
price per share equal to the closing price of the Company’s common stock on the
Nasdaq Stock Market on the Date of Grant, as set forth on Schedule 1 attached to
this Agreement (the “Exercise Price”). The Option shall be subject to the terms
and conditions set forth herein. The Option is being granted pursuant to the RTI
Surgical, Inc. 2015 Incentive Compensation Plan, as may be amended from time to
time (the “Plan”), which is incorporated herein for all purposes. The Option is
a Non-Qualified Stock Option and not an Incentive Stock Option. The Optionee
hereby acknowledges receipt of a copy of the Plan and agrees to be bound by all
of the terms and conditions hereof and thereof and all applicable laws and
regulations.

2.    Definitions. Unless otherwise provided herein, terms used herein that are
defined in the Plan and not defined herein shall have the meanings attributed
thereto in the Plan.

3.    Exercise Schedule. Except as otherwise provided in Sections 6 or 9 of this
Agreement, in the Plan or in the Employment Agreement between the Company and
the Optionee, dated September 15, 2017, as thereafter amended from time to time
(the “Employment Agreement”), the Option is exercisable in installments as
provided below, which shall be cumulative. To the extent that the Option has
become exercisable with respect to a number of Shares as provided below, the
Option may thereafter be exercised by the Optionee, in whole or in part, at any
time or from time to time prior to the expiration of the Option as provided
herein. The following table indicates each date (the “Vesting Date”) upon which
the Optionee shall be entitled to exercise the Option with respect to the number
of Shares granted as indicated beside the date, provided that the Continuous
Service of the Optionee continues through and on the applicable Vesting Date:

 

Number of Shares

  

Vesting Date

0    Any date prior to the first anniversary of the Grant Date. 102,300    The
first day following any 60 Day Period (as defined below) during the Exercise
Period on which the Average Stock Price per share is equal to or greater than
$7.00 (to be adjusted for any stock splits during the Exercise Period). 102,300
   The first day following any 60 Day Period during the Exercise Period on which
the Average Stock Price per share is equal to or greater than $8.00 (to be
adjusted for any stock splits during the Exercise Period). 102,300    The first
day following any 60 Day Period during the Exercise Period on which the Average
Stock Price per share is equal to or greater than $9.00 (to be adjusted for any
stock splits during the Exercise Period).

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By way of example, if the Company’s stock price per share is at $5.00 throughout
all of calendar year 2018, but then increases to $9.50 on January 2, 2019 and is
at or above that same price for 60 days and such 60th day is March 3, 2019, all
225,000 shares of common stock subject to the Option shall vest on March 4,
2019.

For purposes of this Section 3: (I) “60 Day Period” means any period of 60
consecutive calendar days on which the Company’s common stock trades on the
Nasdaq Stock Market and (II) “Average Stock Price” is calculated by averaging
the closing price of the Company’s common stock for each trading day that occurs
during the 60 Day Period (for calendar days during the 60 Day Period that are
not trading days, the closing price on such days shall be deemed to be the
closing price on the most recent previous trading day) (e.g., the closing price
on a Saturday will be deemed to equal the closing price on Friday, the day
before).

Except as otherwise specifically provided herein or in the Employment Agreement,
there shall be no proportionate or partial vesting in the periods prior to each
Vesting Date, and all vesting shall occur only on the appropriate Vesting Date.
Upon the termination of the Optionee’s Continuous Service, any unvested portion
of the Option shall terminate and be null and void.

4.    Method of Exercise. The vested portion of this Option shall be exercisable
in whole or in part in accordance with the exercise schedule set forth in
Section 3 hereof by written notice which shall state the election to exercise
the Option, the number of Shares in respect of which the Option is being
exercised, and such other representations and agreements as to the holder’s
investment intent with respect to such Shares as may be required by the Company
pursuant to the provisions of the Plan. Such written notice shall be signed by
the Optionee and shall be delivered in person or by certified mail to the
Secretary of the Company. The written notice shall be accompanied by payment of
the Exercise Price. This Option shall be deemed to be exercised after both
(a) receipt by the Company of such written notice accompanied by the Exercise
Price and (b) arrangements that are satisfactory to the Compensation Committee
of the Board of Directors of the Company (the “Committee”) in its sole
discretion have been made for Optionee’s payment to the Company of the amount,
if any, that is necessary to be withheld in accordance with applicable Federal
or state withholding requirements. No Shares shall be issued pursuant to the
Option unless and until such issuance and such exercise shall comply with all
relevant provisions of applicable law, including the requirements of any stock
exchange upon which the Shares then may be traded.

5.    Method of Payment. Payment of the Exercise Price shall be by any of the
following, or a combination thereof, at the election of the Optionee: (a) cash;
(b) check; or (c) to the extent permitted by the Committee, with Shares owned by
the Optionee, or the withholding of Shares that otherwise would be delivered to
the Optionee as a result of the exercise of the Option; or (d) such other
consideration or in such other manner as may be determined by the Committee in
its absolute discretion.

6.    Termination of Option.

(a)    General. Any unexercised portion of the Option shall automatically and
without notice terminate and become null and void at the time of the earliest to
occur of the following:

(i)    three months after the date on which the Optionee’s Continuous Service is
terminated other than by reason of (A) by the Company or a Related Entity for
Cause (as defined in the Employment Agreement ), (B) a Disability of the
Optionee as determined by a medical doctor satisfactory to the Committee,
(C) the death of the Optionee, (D) Optionee’s Retirement (as defined below) or
(E) by the Optionee without Good Reason before October 2, 2020 (as defined in
the Employment Agreement);

 

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(ii)    immediately upon the termination of the Optionee’s Continuous Service
(A) by the Company or a Related Entity for Cause or (B) by the Optionee without
Good Reason before October 2, 2020;

(iii)    twelve months after the date on which the Optionee’s Continuous Service
is terminated by the Optionee on account of his or her Retirement (as defined
below);

(iv)    twelve months after the date on which the Optionee’s Continuous Service
is terminated by reason of a Disability as determined by a medical doctor
satisfactory to the Committee;

(v)    twelve months after the date of termination of the Optionee’s Continuous
Service by reason of the death of the Optionee;

(vi)    the tenth (10th) anniversary of the date as of which the Option is
granted.

For purposes of this Agreement, “Retirement” shall mean the date on which the
Optionee voluntarily terminates his or her Continuous Service with the Company
and its Related Entities on or after both (A) attaining age sixty (60) and (B)
completing at least five (5) years of Continuous Service with the Company and
its Related Entities.

(b)    Cancellation. To the extent not previously exercised, (i) the Option
shall terminate immediately in the event of (A) the liquidation or dissolution
of the Company, or (B) any reorganization, merger, consolidation or other form
of corporate transaction in which the Company does not survive or the Shares are
exchanged for or converted into securities issued by another entity, or an
affiliate of such successor or acquiring entity, unless the successor or
acquiring entity, or an affiliate thereof, assumes the Option or substitutes an
equivalent option or right pursuant to Section 10(c) of the Plan, and (ii) the
Committee in its sole discretion may by written notice (“cancellation notice”)
cancel, effective upon the consummation of any transaction that constitutes a
Change in Control, the Option (or portion thereof) that remains unexercised on
such date. The Committee shall give written notice of any proposed transaction
referred to in this Section 6(b) a reasonable period of time prior to the
closing date for such transaction (which notice may be given either before or
after approval of such transaction), in order that the Optionee may have a
reasonable period of time prior to the closing date of such transaction within
which to exercise the Option if and to the extent that it then is exercisable
(including any portion of the Option that may become exercisable upon the
closing date of such transaction). The Optionee may condition his exercise of
the Option upon the consummation of a transaction referred to in this
Section 6(b).

7.    Transferability. Unless otherwise determined by the Committee, the Option
granted hereby is not transferable otherwise than by will or under the
applicable laws of descent and distribution, and during the lifetime of the
Optionee the Option shall be exercisable only by the Optionee, or the Optionee’s
guardian or legal representative. In addition, the Option shall not be assigned,
negotiated, pledged or hypothecated in any way (whether by operation of law or
otherwise), and the Option shall not be subject to execution, attachment or
similar process. Upon any attempt to transfer, assign, negotiate, pledge or
hypothecate the Option, or in the event of any levy upon the Option by reason of
any execution, attachment or similar process contrary to the provisions hereof,
the Option shall immediately become null and void. The terms of this Option
shall be binding upon the executors, administrators, heirs, successors and
assigns of the Optionee.

8.    No Rights of Stockholders. Neither the Optionee nor any personal
representative (or beneficiary) shall be, or shall have any of the rights and
privileges of, a stockholder of the Company with respect to any Shares
purchasable or issuable upon the exercise of the Option, in whole or in part,
prior to the date on which the Shares are issued.

 

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9.    Acceleration of Exercisability of Option.

(a)    Acceleration Upon Certain Terminations or Cancellations of Option. This
Option shall become immediately fully exercisable in the event that, prior to
the termination of the Option pursuant to Section 6 hereof, (i) the Option is
terminated pursuant to Section 6(b)(i) hereof, or (ii) the Company exercises its
discretion to provide a cancellation notice with respect to the Option pursuant
to Section 6(b)(ii) hereof.

(b)    Acceleration Upon Change in Control. This Option shall become immediately
fully exercisable in the event that, prior to the termination of the Option
pursuant to Section 6 hereof, and during the Optionee’s Continuous Service,
there is a “Change in Control”, as defined in Section 9(b) of the Plan.

(c)    Exception to Acceleration Upon Change in Control. Notwithstanding the
foregoing, if in the event of a Change in Control the successor company assumes
or substitutes for the Option, the vesting of the Option shall not be
accelerated as described in Section 9(b). For the purposes of this paragraph,
the Option shall be considered assumed or substituted for if following the
Change in Control the Option or substituted option confers the right to
purchase, for each Share subject to the Option immediately prior to the Change
in Control, on substantially the same vesting and other terms and conditions as
were applicable to the Option immediately prior to the Change in Control, the
consideration (whether stock, cash or other securities or property) received in
the transaction constituting a Change in Control by holders of Shares for each
Share held on the effective date of such transaction (and if holders were
offered a choice of consideration, the type of consideration chosen by the
holders of a majority of the outstanding shares); provided, however, that if
such consideration received in the transaction constituting a Change in Control
is not solely common stock of the successor company or its parent or subsidiary,
the Committee may, with the consent of the successor company, or its parent or
subsidiary, provide that the consideration to be received upon the exercise or
vesting of the Option will be solely common stock of the successor company or
its parent or subsidiary substantially equal in Fair Market Value to the per
share consideration received by holders of Shares in the transaction
constituting a Change in Control. The determination of such substantial equality
of value of consideration shall be made by the Committee in its sole discretion
and its determination shall be conclusive and binding.

10.    Clawback.

(a)    The Company may: (x) cause the cancellation of the Option, (y) require
reimbursement with respect to the Option, and (z) effect any other right of
recoupment of equity or other compensation provided under this Agreement or
otherwise in accordance with any Company policies generally applicable to the
Company’s officers and/or directors that currently exist or that may from time
to time be adopted or modified in the future by the Company to the extent
required to comply with applicable law (each, a “Clawback Policy”), provided
that the following conditions are satisfied: (1) there is an accounting
restatement of the Company’s financial statements or results; and (2) the
restatement results from a noncompliance by the Company with any requirements
under or related to the federal securities laws that is material, injurious to
the Company or was the result of actions with bad intent. In such an event, the
claw back will be in an amount of up to the total economic gain from any
stock-based grants within the five-year period preceding the restatement. By
accepting the Option, the Optionee agrees to be bound to any existing or future
Clawback Policy adopted by the Company, or any amendments that may from time to
time be made to the Clawback Policy in the future by the Company, as required to
comply

 

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with applicable laws or stock exchange requirements, and is further agreeing
that all of the Optionee’s equity awards may be unilaterally amended by the
Company, without the Optionee’s consent, to the extent that the Company in its
discretion determines to be necessary or appropriate to comply with any Clawback
Policy to the extent required to comply with applicable laws or stock exchange
requirements.

(b)    If the Optionee, without the consent of the Company, while employed by or
providing services to the Company or after termination of such employment or
service, violates a non-competition, non-solicitation or non-disclosure covenant
or agreement or otherwise violates the Company’s Corporate Governance
Guidelines, Code of Conduct and Ethics, Code of Ethics for the Chief Executive
Officer and Senior Financial Officer or any other corporate governance materials
specified by the SEC or exchange on which common stock of the Company is listed,
then, if such violation is material and injurious to the Company, or was the
result of actions with bad intent, (i) any outstanding, vested or unvested,
earned or unearned portion of the Option may, at the Committee’s discretion, be
canceled and (ii) the Committee, in its discretion, may require the Optionee or
other person to whom any payment has been made or shares or other property have
been transferred in connection with the Option to forfeit and pay over to the
Company, on demand, all or any portion of the gain (whether or not taxable)
realized upon the exercise of the Option.

11.    No Right to Continued Employment. Neither the Option nor this Agreement
shall confer upon the Optionee any right to continued employment or service with
the Company.

12.    Law Governing. This Agreement shall be governed in accordance with and
governed by the internal laws of the State of Delaware.

13.    Interpretation / Provisions of Plan Control. This Agreement is subject to
all the terms, conditions and provisions of the Plan, including, without
limitation, the amendment provisions thereof, and to such rules, regulations and
interpretations relating to the Plan adopted by the Committee as may be in
effect from time to time. If and to the extent that this Agreement conflicts or
is inconsistent with the terms, conditions and provisions of the Plan, the Plan
shall control, and this Agreement shall be deemed to be modified accordingly.
The Optionee accepts the Option subject to all of the terms and provisions of
the Plan and this Agreement. The undersigned Optionee hereby accepts as binding,
conclusive and final all decisions or interpretations of the Committee upon any
questions arising under the Plan and this Agreement, unless shown to have been
made in an arbitrary and capricious manner.

14.    Notices. Any notice under this Agreement shall be in writing and shall be
deemed to have been duly given when delivered personally or when deposited in
the United States mail, registered, postage prepaid, and addressed, in the case
of the Company, to the Company’s Secretary at 11621 Research Circle, Alachua,
Florida 32615, or if the Company should move its principal office, to such
principal office, and, in the case of the Optionee, to the Optionee’s last
permanent address as shown on the Company’s records, subject to the right of
either party to designate some other address at any time hereafter in a notice
satisfying the requirements of this Section.

[Signature page follows]

 

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IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the 18
day of September, 2017.

 

COMPANY: RTI SURGICAL, INC. By:  

/s/ Paul Montague

  Name:   Paul Montague   Title:   Vice President of Human Resources

The Optionee acknowledges receipt of a copy of the Plan and represents that he
or she has reviewed the provisions of the Plan and this Option Agreement in
their entirety, is familiar with and understands their terms and provisions, and
hereby accepts this Option subject to all of the terms and provisions of the
Plan and the Option Agreement. The Optionee further represents that he or she
has had an opportunity to obtain the advice of counsel prior to executing this
Option Agreement.

 

Dated: September 18, 2017     OPTIONEE:     By:  

/s/ Jonathon M. Singer

      Jonathon M. Singer

 

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SCHEDULE 1

EXERCISE PRICE

 

Closing Price Per Share

[                 ]

Initials:

RTI SURGICAL INC.:                    

RECIPIENT:    

 

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