Document:

Exhibit 10.18

 

CONTINUING GUARANTY

 

For value received and in consideration of the
extension of credit by BANK OF THE WEST (the “Bank”) to ALPHATEC SPINE,
INC. (the “Debtor”) or the benefits to the undersigned derived
therefrom, the undersigned (each, a “Guarantor”), guarantees and
promises to pay to the Bank any and all Indebtedness (as defined in Subsection 1
below) and agrees as follows:

 

1.                                       Indebtedness.  The term “Indebtedness” is used herein
in its most comprehensive sense and includes any and all advances, debts,
obligations, guaranties and liabilities of the Debtor, or any one or more of
them, heretofore, now, or hereafter made, incurred or created, whether
voluntary or involuntary and however arising, whether direct or acquired by the
Bank by assignment, succession, or otherwise, whether due or not due, absolute
or contingent, liquidated or unliquidated, determined or undetermined, secured
or unsecured, whether on original, renewed, extended or revised terms, and
whether the Debtor may be liable individually or jointly with others, or
whether recovery upon any Indebtedness may be or hereafter becomes barred by
any statute of limitations or whether any Indebtedness may be or hereafter
becomes otherwise unenforceable.

 

2.                                       Guaranty.  The Guarantor unconditionally agrees to pay
to the Bank or its order, on demand, in lawful money of the United States of
America, an amount equal to the amount of the Indebtedness and to otherwise
perform any obligation of the Debtor undertaken pursuant to any Indebtedness.  The Guarantor agrees to (a) bear the
expenses enumerated in Subsection 19 hereof and (b) pay interest on
the Indebtedness at the rate(s) applicable thereto.

 

3.                                       Right
to Amend or Modify Indebtedness and/or Collateral.  The Guarantor authorizes the Bank, at its
sole discretion, with or without notice and without affecting the Guarantor’s
liability hereunder, from time to time to: (a) change the time or manner
of payment of any Indebtedness by renewal, extension, modification,
acceleration or otherwise; (b) alter or change any provision of any
Indebtedness including, but not limited to, the rate of interest thereon, and
any document, instrument or agreement (other than this Guaranty) evidencing,
guaranteeing, securing or related to any Indebtedness; (c) release,
discharge, exonerate, substitute or add one or more parties liable on any
Indebtedness or one or more endorsers, cosigners or guarantors for any
Indebtedness; (d) obtain collateral for the payment of any Indebtedness or
any guaranty thereof; (e) release existing or after-acquired collateral on
such terms as the Bank, in its sole discretion, shall determine; (f) apply
any sums received from the Debtor, any endorser, cosigner, other guarantor or
other person liable on any Indebtedness or from the sale or collection of
collateral or its proceeds to any indebtedness whatsoever owed or to be owed to
the Bank by the Debtor in any order or amount and regardless of whether or not
such indebtedness is guaranteed hereby, is secured by collateral or is due and
payable; (g) apply any sums received from the Guarantor or from the sale
of collateral granted by the Guarantor to any Indebtedness in any order or
amount regardless of whether such Indebtedness is secured by collateral or is
due and payable.

 

4.                                       Waivers.  The Guarantor hereby unconditionally and
irrevocably acknowledges and agrees to the matters set forth below:

 

(a)                                  Deficiency.  In
the event that any Indebtedness is now or hereafter secured by a deed of trust,
the Guarantor waives any defense and all rights and benefits of those laws purporting
to state that no deficiency judgment may be recovered on certain real property purchase
money obligations (as presently contained in Section 580b of the
California Code of Civil Procedure and as it may be amended or superseded in
the future) and those laws purporting to state that no deficiency judgment may
be recovered after a trustee’s       sale under a deed of trust (as presently
contained in Section 580d of the California Code of Civil Procedure and as
it may be amended or superseded in the future). 
THE GUARANTOR ACKNOWLEDGES THAT A FORECLOSURE BY A TRUSTEE’S SALE UNDER
A DEED OF TRUST MAY RESULT IN THE DESTRUCTION OF THE GUARANTOR’S
SUBROGATION RIGHTS THAT MAY OTHERWISE EXIST AND THAT A

 

1

 

DESTRUCTION OF THOSE RIGHTS MAY CREATE
A DEFENSE TO A DEFICIENCY JUDGMENT AGAINST THE DEBTOR AND/OR THE GUARANTOR.

 

THE GUARANTOR WAIVES ALL RIGHTS AND DEFENSES THAT
GUARANTOR MAY HAVE BECAUSE THE INDEBTEDNESS OR ANY PORTION THEREOF IS SECURED
BY REAL PROPERTY.  THIS MEANS, AMONG
OTHER THINGS,

 

(1)                                  BANK MAY COLLECT FROM THE GUARANTOR
WITHOUT FIRST FORECLOSING ON ANY REAL OR PERSONAL PROPERTY PLEDGED BY THE
DEBTOR.

 

(2)                                  IF THE BANK FORECLOSES ON ANY REAL PROPERTY
COLLATERAL PLEDGED BY THE DEBTOR,

 

A.                                   THE AMOUNT OF THE INDEBTEDNESS MAY BE
REDUCED ONLY BY THE PRICE FOR WHICH THAT COLLATERAL IS SOLD AT THE FORECLOSURE
SALE, EVEN IF THE COLLATERAL IS WORTH MORE THAN THE SALE PRICE.

 

B.                                     BANK MAY COLLECT FROM THE GUARANTOR EVEN
IF THE CREDITOR, BY FORECLOSING ON THE REAL PROPERTY COLLATERAL, HAS DESTROYED
ANY RIGHT THE GUARANTOR MAY HAVE TO COLLECT FROM THE DEBTOR.

 

THIS IS AN UNCONDITIONAL AND IRREVOCABLE WAIVER OF
ANY RIGHTS AND DEFENSES THE GUARANTOR MAY HAVE BECAUSE THE INDEBTEDNESS IS
SECURED BY REAL PROPERTY.  THESE RIGHTS
AND DEFENSES INCLUDE, BUT ARE NOT LIMITED TO, ANY RIGHTS AND DEFENSES BASED ON SECTION 580a,
580b, 580D, OR 726 OF THE CALIFORNIA CODE OF CIVIL PROCEDURE.

 

(b)                                 Election of Remedies.  Guarantor
waives any defense based upon the Guarantor’s loss of a right against the
Debtor arising from the Bank’s election of a remedy on any Indebtedness under
bankruptcy or other debtor relief laws or under any other laws, including, but
not limited to, those purporting to reduce the Bank’s right against the
Guarantor in proportion to the principal obligation of any Indebtedness (as
presently contained in Section 2809 of the California Civil Code and as it
may be amended or superseded in the future).

 

Without limiting the generality of the foregoing,
Guarantor waives all rights and defenses arising out of an election of remedies
by the Bank, even though that election of remedies, such as a nonjudicial
foreclosure with respect to security for a guaranteed obligation, has destroyed
the Guarantor’s rights of subrogation and reimbursement against the Debtor
(principal) by operation of Section 580d of the Code of Civil Procedure or
otherwise.

 

(c)                                  Statute of Limitations.  To
the maximum extent permitted by law, the Guarantor waives the benefit of the statute
of limitations affecting the Guarantor’s liability hereunder or the enforcement
hereof.

 

(d)                                 Action Against the Debtor
and Collateral (and Other Remedies).  The Guarantor waives all right
to require the Bank to: (i) proceed against the Debtor, any endorser,
cosigner, other guarantor or other person liable on any Indebtedness; (ii) join
the Debtor or any endorser, cosigner, other guarantor or other person liable on
any Indebtedness in any action or actions that may be brought and prosecuted by
the Bank solely and separately against the Guarantor on any Indebtedness; (iii) proceed
against any item or items of collateral securing any Indebtedness or any
guaranty thereof; or (iv) pursue or refrain from pursuing any other remedy
whatsoever in the Bank’s power.

 

2

 

(e)                                  Debtor’s Defenses.  The
Guarantor waives any defense arising by reason of any disability or other
defense of the Debtor, the Debtor’s successor or any endorser, cosigner, other
guarantor or other person liable on any Indebtedness including, without
limitation, any statute of limitation defense that may be available to Debtor
or such other person.  Until all
Indebtedness has been paid in full, even though it may be in excess of the
liability incurred hereby and Bank has no further commitment to lend or extend
financial accommodations to Debtor, the Guarantor shall not have any right of
subrogation and the Guarantor waives any benefit of and right to participate in
any collateral now or hereafter held by the Bank.  The Guarantor waives all presentments,
demands for performance, notices of nonperformance, protests, notices of
protest, notices of dishonor, notices of sale of any collateral securing any
Indebtedness or any guaranty thereof, and notice of the existence, creation or
incurring of new or additional Indebtedness.

 

(f)                                    Debtor’s Financial Condition.  The
Guarantor hereby recognizes, acknowledges and agrees that advances may be made
from time to time with respect to any Indebtedness without authorization from
or notice to the Guarantor even though the financial condition of the Debtor,
any endorser, cosigner, other guarantor or other person liable on any
Indebtedness may have deteriorated since the date of this Guaranty.  The Guarantor waives all right to require the
Bank to disclose any information with respect to: any Indebtedness; the
financial condition, credit or character of the Debtor, any endorser, cosigner,
other guarantor or other person liable on any Indebtedness; any collateral
securing any Indebtedness or any guaranty thereof; or any action or inaction on
the part of the Bank, the Debtor or any endorser, cosigner, other guarantor or
other person liable on any Indebtedness. 
The Guarantor hereby assumes the responsibility for being informed of
the financial condition, credit and character of the Debtor and of all
circumstances bearing upon the risk of non-payment of any Indebtedness which
diligent inquiry would reveal.

 

5.                                       Right
of Set-off; Grant of Security Interest.  In
addition to all liens upon and rights of set-off against any monies, securities
or other property of the Guarantor given to the Bank by law, the Bank shall
have a security interest in and a right to set off against all monies,
securities and other property of the Guarantor now or hereafter in the
possession of or on deposit with the Bank, the Bank’s agents or any one or more
of them, whether held in general or special account or deposit or for
safekeeping or otherwise; and each such security interest and right of set-off
may be exercised without demand upon or notice to the Guarantor.  No action or inaction by the Bank with
respect to any security interest or right of set-off shall be deemed a waiver thereof
and every right of set-off and security interest shall continue in full force
and effect until specifically released by the Bank in writing.  The security interest created hereby shall
secure all of the Guarantor’s obligations under this Guaranty.

 

6.                                       Right
of Foreclosure.  The Bank may foreclose, either by
judicial foreclosure or by exercise of power of sale, any deed of trust
securing any Indebtedness even though such foreclosure may destroy or diminish
the Guarantor’s rights against the Debtor. 
The Guarantor shall be liable to the Bank for any part of any
Indebtedness remaining unpaid after any such foreclosure whether or not such
foreclosure was for fair market value.

 

7.                                       Subordination.  Any indebtedness of the Debtor or any
endorser, cosigner, other guarantor or other person liable on any Indebtedness
now or hereafter owed to the Guarantor is hereby subordinated to the
Indebtedness.  Such indebtedness owed to
the Guarantor shall, if the Bank so requests, be collected, enforced and
received by the Guarantor as trustee for the Bank and be paid over to the Bank
on account of the Indebtedness but without reducing or affecting in any manner
the liability of the Guarantor set forth herein.  Should the Guarantor fail to collect the
proceeds of any such indebtedness owed to it and pay the proceeds to the Bank,
the Bank, as the Guarantor’s attorney-in-fact, may do such acts and sign such
documents in the Guarantor’s name as the Bank considers necessary to effect
such collection, and Guarantor hereby appoints Bank as Guarantor’s attorney-in
fact for such purposes.

 

3

 

8.                                       Invalid,
Fraudulent or Preferential Payments.  The
Guarantor agrees that, to the extent the Debtor or any endorser, cosigner,
other guarantor or other person liable on any Indebtedness makes a payment or
payments to, or is credited for any payment or payments made for or on behalf
of the Debtor to the Bank, which payment or payments, or any part thereof, is
subsequently invalidated, determined to be fraudulent or preferential, set
aside or required to be repaid to any trustee, receiver, assignee or any other
party whether under any bankruptcy, state or federal law or under any common
law or equitable cause or otherwise, then, to the extent thereof, the
obligation or part thereof intended to be satisfied thereby shall be revived,
reinstated and continued in full force and effect as if such payment or
payments had not originally been made or credited.

 

9.                                       Joint
and Several Obligations; Independent Obligations.  If more than one Guarantor signs this
Guaranty, the obligations hereunder are joint and several.  The Guarantor’s obligations hereunder are
independent of the obligations of the Debtor or any endorser, cosigner, other
guarantor or other person liable on any Indebtedness and a separate action or
actions may be brought and prosecuted against the Guarantor on any
Indebtedness.

 

10.                                 Acknowledgment
of Receipt.  Receipt of a true copy of this
Guaranty is hereby acknowledged by the Guarantor.  The Guarantor understands and agrees that
this Guaranty shall not constitute a commitment of any nature whatsoever by the
Bank to renew or hereafter extend credit to the Debtor.  The Guarantor agrees that this Guaranty shall
be effective with or without notice from the Bank of the Bank’s acceptance
hereof.

 

11.                                 Continuing
Guaranty.  This Guaranty is a continuing
guaranty.  Revocation of this Guaranty
shall be effective only after written notice thereof is personally received by
an officer of the Bank at the originating office indicated below or actually
received at the originating office by United States certified or registered
mail, return receipt requested and postage prepaid.  Notice shall be effective at any office of
the Bank should the originating office no longer be in existence.  Revocation shall be effective at the close of
the Bank’s business day when such notice is actually received.  Any revocation shall be effective only as to
the revoking party and shall not affect that party’s obligation with respect to
any Indebtedness existing before such revocation is effective.

 

12.                                 Non-Reliance.  In executing this Guaranty, the Guarantor is
not relying, and has not relied, upon any statement or representation made by
the Bank, or any employee, agent or representative of the Bank, with respect to
the status, financial condition or other matters related to the Debtor or the
relationship between the Debtor and the Bank.

 

13.                                 Multiple
Guaranties.  If the Guarantor has executed or
does execute more than one guaranty of any indebtedness of the Debtor to the
Bank, the limits of liability thereunder and hereunder shall be cumulative.

 

14.                                 Severability.  Should any one or more provisions of this
Guaranty be determined to be illegal or unenforceable, all other provisions
shall remain effective.

 

15.                                 Corporate,
Limited Liability or Partnership Authority.  If the
Debtor is a corporation, limited liability partnership or company or
partnership, the Bank need not inquire into the power of the Debtor or the
authority of its officers, directors, partners or agents acting or purporting
to act in its behalf and any credit granted in reliance upon the purported
exercise of such power or authority is guarantied hereunder.

 

16.                                 Separate
Property.  Any married person who signs this
Guaranty expressly agrees that recourse may be had against such person’s
separate property for all obligations hereunder.

 

4

 

17.                                 Interpretation.  If there is more than one Debtor named herein
or more than one Guarantor executing this Guaranty, the words “Debtor” and “Guarantor”
shall respectively mean all and any one or more of them.  As used in this Guaranty, neuter terms
include the masculine and feminine, and vice versa.

 

18.                                 Assignment.  The Bank may, with or without notice, assign
this Guaranty in whole or in part.  This
Guaranty shall inure to the benefit of the Bank, its successors and assigns,
and shall bind the Guarantor and the Guarantor’s heirs, executors,
administrators, successors and assigns.

 

19.                                 Attorney’s
Fees.  Guarantor shall pay to Bank all costs and
expenses, including, but not limited to reasonable attorney fees, incurred by
Bank in connection with the administration, enforcement, including any
bankruptcy, at trial and on appeal, or the enforcement of any judgment or any
refinancing or restructuring of the Guarantor’s obligations under this Guaranty
or any document, instrument of agreement executed with respect to, evidencing
or securing the indebtedness hereunder.

 

20.                                 Governing
Law.  This Guaranty shall be governed by and
construed according to the internal laws of the State of California without
regard to conflict of law principles, and the Guarantor hereby submits to the
jurisdiction of the courts of the State of California.

 

21.                                 Headings.  The headings used herein are solely for the
purpose of identification and have no legal significance.

 

22.                                 Address
of the Bank.  The Bank’s originating office
under this Guaranty is:

 

San Diego Office (CBC)

1280 4th Avenue

San Diego, CA 92101

 

23.                                 Indebtedness
to Bank Subsidiaries, Affiliates and Assigns:  The
definition of “Bank” as used herein includes BANK OF THE WEST, its
subsidiaries, affiliates and assigns.

 

24.                                 Maximum
Principal Liability.  THE MAXIMUM
PRINCIPAL LIABILITY UNDER THIS GUARANTY IS the amount of $12,000,000.00, plus
interest at the rate(s) applicable to any Indebtedness as set forth in Subsection 1
hereof and the expenses enumerated in Subsection 19 hereof.

 

This
Guaranty is made as of January 25, 2006 (which shall be the date of this
Guaranty).

 

Executed
by the undersigned Guarantor(s) as of the date set forth above.

 

	
   

  	
  GUARANTOR(S):

  
	
   

  	
   

  
	
  ADDRESS:

  	
   

  
	
   

  	
   

  
	
  2051 Palomar Airport Road, Suite 100

  	
  ALPHATEC HOLDINGS, INC.

  
	
  Carlsbad, CA 92011

  	
   

  
	
   

  	
  BY:

  	
  /s/ Scott Palka

  	
   

  
	
   

  	
  NAME:   Scott Palka, CFO and Treasurer

  

 

5Exhibit
10.19

LOAN
AGREEMENT

This Loan Agreement is made and entered into as of August 11, 2005
between Shunshiro Yoshimi. (hereinafter
referred to as the “Lender”) residing at 25-7 Asumigaoka, 7 Chome, Midori-ku,
Chiba-shi, Chiba, Japan, and Alphatec Pacific, Inc.
(hereinafter referred to as the “Borrower”) with its head office located at 5F
Ichibancho M Building, 2-10 Ichiban-Cho Chiyoda-Ku, Tokyo 102-0082, Japan.

WHEREAS, the Borrower wishes to borrow from the Lender the sum of ¥350,000,000
(three hundred fifty million Japanese yen) for the purpose of making payment for
Borrower’s obligation under a certain “Business Transfer Agreement” entered
into between K.K. Mac and the Borrower; and

WHEREAS, the terms of this Agreement were negotiated in the offices of
HealthpointCapital, LLC, in New York, New York.

NOW, THEREFORE, it is agreed as follows:

1.             LOAN

The Lender agrees to make available to the Borrower a loan on August 11,
2005, in the amount of ¥350,000,000 (three hundred fifty million Japanese yen) (the
“Loan”).

2.             REPAYMENT OF LOAN AND INTEREST

The Borrower shall repay to the Lender the Loan on each date and in the
amount specified in the Annex attached hereto.

3.             DEFAULT

3.1           If the Borrower
fails to pay any sum due from it hereunder at any time, in the manner specified
herein, and that failure continues for 30 days following notice to the
Borrower, with a copy to Alphatec Spine, Inc., the amount set forth in Section
3.3 shall become due and payable.

3.2           If any one or more
of the following events occurs, the amount set forth in Section 3.3 shall
become due and payable, without any notice by the Lender:

(a)           the Borrower enters
into any voluntary or involuntary liquidation or dissolution;

(b)           the Borrower stops
payment or is unable to, or admits inability to pay its debts as they fall due;

(c)           a receiver or
liquidator or other similar officer shall be appointed over all or any
substantial part of its assets;

(d)           the Borrower
commences any proceedings under any relevant reorganization agreement,
re-adjustment of debts, dissolution or liquidation law or regulation of Japan;

(e)           there occurs a “Change
of Control of Seller” or a “Change of Control of API”, each as defined in the Stock
Purchase Agreement dated as of August 11, 2005 between Lender and Alphatec
Spine, Inc., a California corporation; or

(f)            the “Executive Services Agreement”
entered into as of August 11, 2005 between the Lender and Alphatec Spine,
Inc. is involuntarily terminated pursuant to and in accordance with Section 4.2
(Termination Without Cause) of such agreement.

3.3           If an amount becomes due and payable
pursuant to Section 3.1 or Section 3.2 on a date (the “Acceleration Date”) that
is:

(a)           within nine months from the date that
the Borrower’s first payment is due under this Agreement as set forth on the
Annex (the “First Payment Date”), the Borrower shall within five (5) business
days after the Acceleration Date pay to the Lender ¥350,000,000 (three hundred
fifty million Japanese yen) less all amounts previously paid by the Borrower to
the Lender, plus the sum of ¥35,000,000 (thirty-five million Japanese yen); and

(b)           on or after nine months from the First
Payment Date, the Borrower shall pay to the Lender within five (5) business
days after the Acceleration Date ¥350,000,000 (three hundred fifty million
Japanese yen) less all amounts previously paid by the Borrower to the Lender,
plus the sum of ¥70,000,000 (seventy million Japanese yen).

3.4                      If
the Borrower fails to pay on the due date any sum due under this Agreement, the
Borrower shall pay default interest of 14% per annum on such sum from the due
date to the actual date of payment.

4.             MISCELLANEOUS

4.1           This Agreement sets forth the entire
agreement between the parties hereto with respect to the matters subject to
this Agreement.  Any provision of this
Agreement may be amended or modified in whole or in part at any time by an
agreement in writing between the parties hereto.

4.2           In the event that any one or more of
the provisions contained in this Agreement or in any other instrument referred
to herein shall, for any reason, be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provision of this Agreement, any other such Articles
or any other such instrument.

4.3           No failure or delay on the part of
any party hereto with respect to the exercise of any right, power, privilege,
or remedy under this Agreement shall operate as a waiver thereof, nor shall any
exercise or partial exercise of any such right, power, privilege, or remedy
preclude any further exercise thereof or the exercise of any other right,
power, privilege, or remedy.  No
modification or waiver by either party hereto of any provision of this
Agreement or consent to any departure by the other party therefrom shall be
effective in any event unless in writing, and then only in the specific
instance and for the purpose for which given. 
Notwithstanding the foregoing, each party hereto shall have the right to
waive compliance by the other party with any of the provisions hereof, or to
modify such provisions to a less restrictive obligation of the other party, the
details of which shall be determined by such party, with or without prior
notice to the other party.

 

2

4.4           The rights, powers, privileges, and
remedies hereunder are cumulative and not exclusive of any other right, power,
privilege, or remedy the parties hereto would otherwise have.

4.5           This Agreement shall be governed by
and construed and enforced in accordance with the laws of the State of New York.

4.6           Notices.

(a)           All notices under this Agreement must
be in writing and may be given by personal delivery, telex, telegram, private
courier service or registered or certified mail.

(b)           A notice is deemed to have been
given:

(i)            by personal
delivery or private courier service, as of the day of delivery of the notice to
the addressee; and

(ii)           by mail, as of the
fifth (5th) day after the notice is mailed.

(c)           Notices must be sent to:

(i)            if
to Borrower, to:

 

Alphatec Pacific, Inc.

5F
Ichibancho M Building

2-10
Ichiban-Cho Chiyoda-Ku, Tokyo 102-0082

Japan

Telecopier:
(81)-3-3511-5187

Attention:  Gen Yoshimi

 

with a copy to:

Alphatec Spine, Inc.

2051
Palomar Airport Road, Suite 100

Carlsbad,
CA 92011

Telecopier:
(760) 431-1573

Attention:  John
H. Foster

 

and a copy to:

Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.

Chrysler Center

666 Third Avenue

New York, New York 10017

Attention:  Stephen C. Curley, Esq.

                (ii)           if to Lender, to:

Shunshiro Yoshimi

25-7 Asumigaoka, 7 Chome

Midori-ku

Chiba-shi

Chiba-ken

 

3

with a copy to:

 

Jacobson, Mermelstein & Squire, LLP

52 Vanderbilt Avenue

New York, New York 10017

Attention:  Walter C. Squire, Esq.

 

4.7           Any controversy or claim arising out
of or relating to this Agreement, or the breach thereof, shall be settled
exclusively by arbitration in accordance with the Rules of the American
Arbitration Association (“AAA”), before a panel of three (3) arbitrators.  The arbitrators shall be chosen by mutual
agreement of Lender and Borrower, or if they cannot agree, by the AAA.  The arbitrators shall be required to apply
and shall be bound by applicable New York State and federal law in rendering
their decision.  The determination of the
arbitration shall be conclusive and binding, and judgment upon the award
rendered by the arbitrators may be entered in any court having jurisdiction
thereof.  The arbitration shall take
place in New York City.  Each party shall
bear its own costs incurred in connection with any such arbitration, and the
fees and expenses of the arbitrators shall be shared equally by the Lender and
Borrower.

4.8           This Agreement shall be binding upon
and inure to the benefit of the parties named herein and their respective successors
and permitted assigns.  The parties may
not assign any of their rights or delegate any of their duties under this
Agreement.

IN WITNESS hereof, the Lender and the duly
appointed representatives of the Borrower hereto have set their hands on the 11
day of August, 2005.

	
   

  	
   

  	
  LENDER:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  /s/ Shunshiro Yoshimi

  
	
   

  	
   

  	
  Shunshiro Yoshimi

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  BORROWER:

  
	
   

  	
   

  	
  ALPHATEC PACIFIC INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ John H. Foster

  
	
   

  	
   

  	
  Name:

  	
  John H. Foster

  
	
   

  	
   

  	
  Title:

  	
  Director

  

 

4

ANNEX

	
   

  	
   

  	
  Date

  	
   

  	
   

  	
   

  	
  Amount

  	
   

  	
   

  
	
  1.

  	
   

  	
  December 1, 2005

  	
   

  	
  JPY 23,333,333

  	
   

  
	
  2.

  	
   

  	
  January 1, 2006

  	
   

  	
  JPY 23,333,333

  	
   

  
	
  3.

  	
   

  	
  February 1, 2006

  	
   

  	
  JPY 23,333,333

  	
   

  
	
  4.

  	
   

  	
  March 1, 2006

  	
   

  	
  JPY 23,333,333

  	
   

  
	
  5.

  	
   

  	
  April 1, 2006

  	
   

  	
  JPY 23,333,333

  	
   

  
	
  6.

  	
   

  	
  May 1, 2006

  	
   

  	
  JPY 23,333,333

  	
   

  
	
  7.

  	
   

  	
  June 1, 2006

  	
   

  	
  JPY 23,333,333

  	
   

  
	
  8.

  	
   

  	
  July 1, 2006

  	
   

  	
  JPY 23,333,333

  	
   

  
	
  9.

  	
   

  	
  August 1, 2006

  	
   

  	
  JPY 23,333,333

  	
   

  
	
  10.

  	
   

  	
  September 1, 2006

  	
   

  	
  JPY 23,333,333

  	
   

  
	
  11.

  	
   

  	
  October 1, 2006

  	
   

  	
  JPY 23,333,333

  	
   

  
	
  12.

  	
   

  	
  November 1, 2006

  	
   

  	
  JPY 23,333,333

  	
   

  
	
  13.

  	
   

  	
  December 1, 2006

  	
   

  	
  JPY 23,333,333

  	
   

  
	
  14.

  	
   

  	
  January 1, 2007

  	
   

  	
  JPY 23,333,333

  	
   

  
	
  15.

  	
   

  	
  February 1, 2007

  	
   

  	
  JPY 23,333,333

  	
   

  
	
  16.

  	
   

  	
  March 1, 2007

  	
   

  	
  JPY 23,333,333

  	
   

  
	
  17.

  	
   

  	
  April 1, 2007

  	
   

  	
  JPY 23,333,333

  	
   

  
	
  18.

  	
   

  	
  May 1, 2007

  	
   

  	
  JPY 23,333,339

  	
   

  

 

 

5

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00097-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00097-of-00352.parquet"}]]