Document:

First
Amendment to Royalty Agreement

 

This FIRST AMENDMENT
TO ROYALTY AGREEMENT (this “Amendment”) is made and entered into as of August 12, 2013 by and among Bacterin
International, Inc., a Nevada corporation (“Bacterin”),
and ROS Acquisition Offshore LP,
a Cayman Islands Exempted Limited Partnership (“ROS”).

 

WHEREAS, Bacterin
and ROS are party to that certain Royalty Agreement, dated as of August 24, 2012 (the “Royalty Agreement”);
and

 

WHEREAS, Bacterin
and ROS desire to amend certain provisions of the Royalty Agreement as provided in this Amendment;

 

NOW, THEREFORE,
in consideration of the mutual agreements herein contained, and for other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, Bacterin and ROS hereto agree as follows:

 

1.                 
Definitions; Loan Document. Capitalized terms used herein without definition shall have the meanings assigned
to such terms in the Royalty Agreement. This Amendment shall constitute a Loan Document for all purposes of the Royalty Agreement
and the other Loan Documents.

 

2.                 
Amendment to Section 1.1. Section 1.1 of the Royalty Agreement is hereby amended by amending and restating
the definitions of “Confidential Information” and “Receiving Party” to read in their respective entireties
as follows:

 

““Confidential
Information” means any and all information or material (whether written or oral, or in electronic or other form) that,
at any time before, on or after the Closing Date, has been or is provided or communicated to the Receiving Party by or on behalf
of the Disclosing Party.”

 

““Receiving
Party” means the Party receiving Confidential Information which, in the case of ROS, shall be deemed to mean ROS and
its employees, officers, directors and any persons designated by it as board observers (each, a “Representative”).”

 

3.                 
Amendment to Section 7.1. Section 7.1 of the Royalty Agreement is hereby amended by adding the following two
sentences to the end of such Section:

 

“A Receiving
Party shall also be permitted to disclose Confidential Information that is, in the opinion of its counsel, required to be disclosed
pursuant to Law or Judgment binding upon the Receiving Party or pursuant to the requirement or request of any Governmental Authority.
ROS shall be responsible for any breach of this Section 7.1 by any of its Representatives.”

 

4.                 
Amendment to Section 7.2. Section 7.2 of the Royalty Agreement is hereby amended and restated to read in its
entirety as follows:

 

    	 

    	 

    

 

“SECTION 7.2Exceptions
to Confidentiality. The following information shall not be deemed to be Confidential Information of the Disclosing Party:

 

(a)information
that is or hereafter becomes part of the public domain (other than as a result of a disclosure by the Receiving Party or its Recipients
in violation of this Royalty Agreement);

 

(b)information
that is received from a Third Party without restriction on disclosure and without, to the knowledge of the Receiving Party, breach
of any agreement between such Third Party and the Disclosing Party;

 

(c)information
that the Receiving Party can demonstrate by competent evidence was already in its possession without any limitation on disclosure
prior to its receipt from the Disclosing Party;

 

(d)information
that is generally made available to Third Parties by the Disclosing Party without restriction on disclosure; or

 

(e) information
that the Receiving Party can demonstrate by competent evidence was independently developed by the Receiving Party.”

 

5.                 
Effective Date. This Amendment shall become effective on the date on which Bacterin and ROS each duly executes
a counterpart of this Amendment.

 

6.                 
Expenses. Bacterin agrees to pay on demand all expenses of ROS (including, without limitation, the fees and
out-of-pocket expenses of Covington & Burling LLP, counsel to ROS, and of local counsel, if any, who may be retained by or
on behalf of ROS) incurred in connection with the negotiation, preparation, execution and delivery of this Amendment.

 

7.                 
No Implied Amendment or Waiver. Except as expressly set forth in this Amendment, this Amendment shall not,
by implication or otherwise, limit, impair, constitute a waiver of or otherwise affect any rights or remedies of Bacterin or ROS
under the Royalty Agreement or the other Loan Documents, or alter, modify, amend or in any way affect any of the terms, obligations
or covenants contained in the Royalty Agreement or the other Loan Documents, all of which shall continue in full force and effect.
Nothing in this Amendment shall be construed to imply any willingness on the part of either Bacterin or ROS to agree to or grant
any similar or future amendment, consent or waiver of any of the terms and conditions of the Royalty Agreement or the other Loan
Documents.

 

8.                 
Counterparts; Governing Law. This Amendment may be executed in any number of counterparts and by different
parties hereto on separate counterparts, each of such when so executed and delivered shall be an original, but all of such counterparts
shall together constitute but one and the same agreement. Delivery of an executed counterpart of a signature page of this Amendment
by fax transmission or other electronic mail transmission (e.g., “pdf” or “tif”) shall be effective as
delivery of a manually executed counterpart of this Amendment. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS
LAW OF THE STATE OF NEW YORK).

 

    	-2-

    	 

    

 

[Remainder
of Page Intentionally Left Blank]

 

IN WITNESS WHEREOF, the parties
hereto have caused this Amendment to be executed by their respective officers thereunto duly authorized as of the day and year
first above written.

 

 

	 	
        BACTERIN INTERNATIONAL, INC.

         

	 	 
	 	By: /s/ John P. Gandolfo                                
	 	Name:  John P. Gandolfo
	 	Title:    Chief Financial Officer
	 	 
	 	 
	 	ROS Acquisition Offshore LP
	 	By ROS Acquisition Offshore GP Ltd.,
	 	its General Partner
	 	By OrbiMed Advisors LLC,
	 	its investment manager
	 	 
	 	By: /s/ Samuel D. Isaly                                
	 	Name:  Samuel D. Isaly
	 	Title:    Managing Member

 

 

Signature Page to First Amendment to
Royalty AgreementWaiver
AND THIRD AMENDMENT TO CREDIT AGREEMENT

 

This WAIVER AND THIRD
AMENDMENT TO CREDIT AGREEMENT (this “Amendment”) is made and entered into as of August 12, 2013 by and between
Bacterin International, Inc.,
a Nevada corporation (the “Borrower”), and ROS
Acquisition Offshore LP, a Cayman Islands Exempted Limited Partnership (the “Lender”).

 

WHEREAS, the Borrower
and the Lender are party to that certain Credit Agreement, dated as of August 24, 2012 (as amended by that certain First Amendment
to Credit Agreement, dated as of May 16, 2013, and as further amended by that certain Waiver and Second Amendment to Credit Agreement,
dated as of August 12, 2013, the “Credit Agreement”), pursuant to which the Lenders have extended credit to
the Borrower on the terms set forth therein;

 

WHEREAS, the Borrower
has advised the Lender that the Revenue Base for the Fiscal Quarter ended June 30, 2013 was less than the Minimum Revenue Base
required for such Fiscal Quarter under Section 8.4.1 of the Credit Agreement, and therefore an Event of Default has occurred under
Section 9.1.3 of the Credit Agreement (the “Existing Default”);

 

WHEREAS, the Borrower
has requested that the Lender waive the Existing Default; and

 

WHEREAS, the Lender
is willing to waive the Existing Default in connection with amending the Credit Agreement as set forth herein, and the Borrower
agrees to such amendment, in each case only upon the terms and subject to the conditions set forth herein.

 

NOW, THEREFORE,
in consideration of the mutual agreements herein contained, and for other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto agree as follows:

 

1.                 
Definitions; Loan Document. Capitalized terms used herein without definition shall have the meanings assigned
to such terms in the Credit Agreement. This Amendment shall constitute a Loan Document for all purposes of the Credit Agreement
and the other Loan Documents.

 

2.                 
Amendment to Section 3.2. The last two sentences of Section 3.2 of the Credit Agreement are hereby amended
and restated in their entirety to read as follows:

 

At such time as the
Borrower pays, prepays or repays, or is required to pay, prepay or repay, any principal amount of the Loans, whether on the Maturity
Date or otherwise, whether voluntarily or involuntarily (if involuntarily, whether required by this Agreement, the Royalty Agreement
or any other Loan Document) and whether before or after acceleration of the Obligations, including without limitation any payment
pursuant to any provision of this Section 3.2, the Borrower shall pay to the Lender a fee in the amount equal to 3.5% of
the aggregate principal amount of such payment, prepayment or repayment. For the avoidance of doubt, any such fees paid by the
Borrower to the Lender shall not be included in clause (ii) of the definition of “Recovered Amount” for purposes of
the Royalty Agreement.

 

    	 

    	 

    

 

3.                 
Waiver. The Lender hereby waives the Existing Default and agrees not to exercise any rights or remedies that
may be available to it as a result of the occurrence thereof.

 

4.                 
Conditions to Effectiveness of Amendment. This Amendment, including the Lender’s consent to the Waiver
in Section 3 of this Amendment, shall become effective upon receipt by the Lender of a counterpart signature to this Amendment
duly executed and delivered by the Borrower.

 

5.                 
Expenses. The Borrower agrees to pay on demand all expenses of the Lender (including, without limitation,
the fees and out-of-pocket expenses of Covington & Burling LLP, counsel to the Lender, and of local counsel, if any, who may
be retained by or on behalf of the Lender) incurred in connection with the negotiation, preparation, execution and delivery of
this Amendment.

 

6.                 
Representations and Warranties. The Borrower represents and warrants to the Lender as follows:

 

(a)               
After giving effect to this Amendment, the representations and warranties of the Borrower and the Guarantors contained in
the Credit Agreement or any other Loan Document shall, (i) with respect to representations and warranties that contain a materiality
qualification, be true and correct in all respects on and as of the date hereof, and (ii) with respect to representations and warranties
that do not contain a materiality qualification, be true and correct in all material respects on and as of the date hereof, and
except that the representations and warranties limited by their terms to a specific date shall be true and correct as of such date.

 

(b)              
After giving effect to this Amendment, no Default or Event of Default under the Credit Agreement will occur or be continuing.

 

7.                 
No Implied Amendment or Waiver. Except as expressly set forth in this Amendment, this Amendment shall not,
by implication or otherwise, limit, impair, constitute a waiver of or otherwise affect any rights or remedies of the Lender under
the Credit Agreement or the other Loan Documents, or alter, modify, amend or in any way affect any of the terms, obligations or
covenants contained in the Credit Agreement or the other Loan Documents, all of which shall continue in full force and effect.
Nothing in this Amendment shall be construed to imply any willingness on the part of the Lender to agree to or grant any similar
or future amendment, consent or waiver of any of the terms and conditions of the Credit Agreement or the other Loan Documents.

 

8.                 
Waiver and Release. TO INDUCE THE LENDER TO AGREE TO THE TERMS OF THIS AMENDMENT, THE BORROWER REPRESENTS
AND WARRANTS THAT AS OF THE DATE HEREOF THERE ARE NO CLAIMS OR OFFSETS AGAINST OR RIGHTS OF RECOUPMENT WITH RESPECT TO OR DEFENSES
OR COUNTERCLAIMS TO ITS OBLIGATIONS UNDER THE LOAN DOCUMENTS AND IN ACCORDANCE THEREWITH IT:

 

    	 

    	 

    

 

(a)               
WAIVES ANY AND ALL SUCH CLAIMS, OFFSETS, RIGHTS OF RECOUPMENT, DEFENSES OR COUNTERCLAIMS, WHETHER KNOWN OR UNKNOWN, ARISING
PRIOR TO THE DATE HEREOF; AND

 

(b)              
RELEASES AND DISCHARGES THE LENDER, ITS AFFILIATES AND ITS AND THEIR OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, SHAREHOLDERS
AND ATTORNEYS (COLLECTIVELY THE “RELEASED PARTIES”) FROM ANY AND ALL OBLIGATIONS, INDEBTEDNESS, LIABILITIES,
CLAIMS, RIGHTS, CAUSES OF ACTION OR DEMANDS WHATSOEVER, WHETHER KNOWN OR UNKNOWN, SUSPECTED OR UNSUSPECTED, IN LAW OR EQUITY, WHICH
THE BORROWER EVER HAD, NOW HAS, CLAIMS TO HAVE OR MAY HAVE AGAINST ANY RELEASED PARTY ARISING PRIOR TO THE DATE HEREOF AND FROM
OR IN CONNECTION WITH THE LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED THEREBY.

 

9.                 
Counterparts; Governing Law. This Amendment may be executed in any number of counterparts and by different
parties hereto on separate counterparts, each of such when so executed and delivered shall be an original, but all of such counterparts
shall together constitute but one and the same agreement. Delivery of an executed counterpart of a signature page of this Amendment
by fax transmission or other electronic mail transmission (e.g., “pdf” or “tif”) shall be effective as
delivery of a manually executed counterpart of this Amendment. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS
LAW OF THE STATE OF NEW YORK).

 

[Remainder
of Page Intentionally Left Blank]

 

    	 

    	 

    

  

IN WITNESS WHEREOF, the parties
hereto have caused this Amendment to be executed by their respective officers thereunto duly authorized as of the day and year
first above written.

 

 

 

	 	
        BACTERIN INTERNATIONAL, INC.,

        as the Borrower

	 	 
	 	By: /s/ John P. Gandolfo                                   
	 	Name:  John P. Gandolfo
	 	Title:    Chief Financial Officer
	 	 
	 	 
	 	ROS Acquisition Offshore LP,

as the Lender
	 	By ROS Acquisition Offshore GP Ltd.,
	 	its General Partner
	 	By OrbiMed Advisors LLC,
	 	its investment manager
	 	 
	 	By: /s/ Samuel D. Isaly                                   
	 	Name:  Samuel D. Isaly
	 	Title:    Managing Member

 

 

Signature Page to Waiver and Third Amendment
to Credit Agreement

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