Document:

ATEC-2014.03.31.EX-10.6

Exhibit 10.6

BINDING TERM SHEET 

1.This Binding Term Sheet (the “Agreement”) is entered into on March 15, 2014. 
2.    Alphatec Holdings, Inc., Healthpoint Capital, LLC, will pay OrthoTec, LLC, the amounts specified according to this Binding Term Sheet as specifically set forth in Attachment A hereto. 
3.    The payments set forth in Attachment A will be guaranteed by Stipulated Judgments against (i) Alphatec Holdings, Inc., (ii) Healthpoint Capital Partners, L.P., Healthpoint Capital Partners II, L.P., (iii) Healthpoint Capital, LLC, and (iii) John H. Foster and  Mortimer Berkowitz, III.  The Stipulated Judgments will reflect the total amounts set forth in Attachment A.  The Stipulated Judgments will be held and entered only in the event of a default and will be enforced against the judgment debtors in the order specified above.  In the event of a default, OrthoTec’s sole remedy will be to sue to collect on the Stipulated Judgment amounts, less the amounts already paid, plus reasonable attorneys’ fees and costs incurred in pursuing collection.
4.    The foregoing payment is to settle (i) OrthoTec, LLC. v. Surgiview, S.A.S., et al., Case No. BC 390346, in the Los Angeles Superior Court (the “Alphatec Action”), (ii) OrthoTec, LLC., v. Healthpoint Capital, LLC., et al., Case No. 08601377, in New York Supreme Court (the “Healthpoint Action”); (iii) OrthoTec, LLC v. Olivier Carli, Case No. BC533849, in the Los Angeles Superior Court (the “Carli Action”); and (iv) Patrick Bertranou v. Kenneth Weisberg and Stellar Weisberg, Case No. BC513436, in the Los Angeles Superior Court (the “Weisberg Action”).
5.    Upon payment of the initial, lump sum payment pursuant to Attachment A ($15.75 million) the parties will execute and file dismissals with prejudice of the actions noted above.  The respective courts will retain jurisdiction to enforce this Agreement. 
6.    RELEASED PARTIES. 
A.    Defendant Released Parties:  The Defendant Released Parties shall mean 
i.    Alphatec Released Parties:  The Alphatec Released Parties shall include: 
(1)    Alphatec Holdings, Inc., and all of its direct and indirect subsidiaries throughout the world, including, without limitation, Alphatec Spine, Inc., Alphatec Pacific Inc., Alphatec Spine GmbH, Millerton Ltd., Japan Ortho Medical; Alphatec Holdings International CV, Cooperatie Alphatec Holdings Europa U.A., Alphatec International, LLC., Scient’x S.A.S., Cibramed Productos Medicos, Ltda., Scient’x UK Ltd., Scient’x AUS, Scient’s USA, Scientx Asial Pacific, Scient’x Italia, Surgiview S.A.S., and each of their direct and indirect subsidiaries and affiliates. 
(2)    All current or former successors, partners, associates, officers, directors, employees, insurers, agents, advisors, attorneys and representatives of or for any of the Alphatec Entities.  It is understood that such terms may vary from country to country, and this 

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Agreement releases all claims against entities and individuals whose liability would be predicated on any action or inaction on their part that was in any manner connected to the individual or entity’s  affiliation with one or more of the Alphatec Entities, or whose action or inaction could give rise to any liability (direct or indirect, whether by way of respondeat superior, indemnity, contribution, or any other basis) on the part of the Alphatec Released Parties. 
B.    Healthpoint Released Parties: The Healthpoint Released Parties shall include
i.    HealthpointCapital, LLC., Healthpoint Capital Partners, LP, HealthpointCapital Partners II, LP, John H. Foster, Mortimer Berkowitz, III (hereafter the “Healthpoint Parties”).
ii.    All current or former affiliates, subsidiaries, partners, associates, officers, directors, employees, insurers, agents, advisors, attorneys and representatives (and each of their respective predecessors, successors, assigns, and, as applicable, heirs) throughout the world of or for any of the Healthpoint Parties.  It is understood that such terms may vary from country to country, and this Agreement releases all claims against individuals or entities whose liability would be predicated on any action or inaction on their part that was in any manner connected to the individual or entity’s affiliation with one or more of the Healthpoint Parties, or whose action or inaction could give rise to any liability (direct or indirect, whether by way of respondeat superior, indemnity, contribution, or any other basis) of the Healthpoint Released Parties. 
C.    The Carli Released Parties:  The Carli Released Parties shall include Olivier Carli, members of his family, heirs, advisors, attorneys and representatives of Mr. Carli or his family, and any person or entity with which Mr. Carli has or has had or may in the future have an affiliation of any sort, including without limitation ownership (direct or indirect) or serving as an officer, director, advisor, or employee of any sort.  
D.    The Weissberg Released Parties.  The Weissberg Released Parties shall include Kenneth Weissberg and Selarl Weissberg and their affiliates, heirs, advisors, attorneys and representatives, and any other person or entity allegedly involved in any matter with the French proceedings at issue in the Weissberg Action or the Weissberg Action.
E.    The OrthoTec Released Parties:  The OrthoTec Released Parties shall include OrthoTec, LLC, Patrick Bertranou, and all current or former successors, partners, associates, officers, directors, employees, insurers, agents, advisors, attorneys and representatives of or for any OrthoTec.   It is understood that such terms may vary from country to country, and this Agreement releases all claims against individuals or entities whose liability would be predicated on any action or inaction on their part that was in any manner connected to the individual or entity’s affiliation with OrthoTec, or whose action or inaction could give rise to any liability (direct or indirect, whether by way of respondeat superior, indemnity, contribution, or any other basis) of OrthoTec.
7.    Releases. 
A.    Release by Alphatec and Healthpoint of OrthoTec Released Parties.  

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iii.    Alphatec and Healthpoint hereby release, effective as of the date of this Agreement, the OrthoTec Released Parties, and each of them, from any and all claims, demands, and causes of action, whether known or unknown, in contract or tort, arising out of or incurred in connection with any facts or circumstances existing prior to the date of this Agreement.  
B.    Release by OrthoTec of the Alphatec Released Parties, the Healthpoint Released Parties, the Carli Released Parties and the Weissberg Released Parties. 
i.    OrthoTec hereby releases, effective as of the time of this Agreement, the Alphatec Released Parties, the Healthpoint Released Parties, the Carli Released Parties and the Weissberg Released Parties and each of them, from any and all claims, demands, and causes of action, whether known or unknown, in contract or in tort, arising out of or incurred in connection with any action, conduct, or omission or other facts or circumstance existing or occurring from the beginning of time up to the date of this Agreement, including, without limitation, the allegations made or that could have been made in the Alphatec Action, the Healthpoint Action, the Carli Action, and the Weissberg action. 
ii.    By way of limitation, it is agreed that as to OrthoTec’s release of unnamed affiliates, associates, outside insurers, agents, advisors, attorneys and representatives, OrthoTec’s release shall be of claims, demands, or causes of action  that related in any way to the claims or allegations in the Alphatec Action, the Healthpoint Action, the Carli Action, and the Weissberg action.   For clarity, releases of such unnamed persons or entities shall not include unknown claims.   
8.    The parties expressly waive the benefits of Section 1542 of the California Civil Code, or any comparable provision under New York or other potentially applicable law
9.    Alphatec Holdings, Healthpoint Capital, Healthpoint Capital Partners, LP, Healthpoint Capital Partners II, LP, John H. Foster, and Mortimer Berkowitz, III deny any and all allegations made by OrthoTec in the above-referenced actions.   This Agreement contains no admission of liability whatever.
10.    This Agreement is entered into in the State of California and will be governed and interpreted under the laws of California.  Any action to enforce this Agreement will be brought in the Los Angeles County Superior Court (if the dispute is between OrthoTec, on the one hand, and Alphatec Holdings, on the other) or in the Supreme Court of New York (if the dispute is between OrthoTec, on the one hand, and Healthpoint Capital LLC, John H. Foster, and/or Mortimer Berkowitz, III on the other).
11.    This Agreement will be memorialized in a final settlement agreement containing customary terms and provisions, but will be enforceable if no final settlement agreement is entered.  The parties will work in good faith to draft and execute the final settlement agreement within 15 days.

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Signature page to the Binding Term Sheet, dated March 15, 2014

Dated:    3/15/14                    Alphatec Holdings, Inc.

/s/ Siri Marshall            
By:  Siri Marshall, for the Alphatec Special Committee of the Board of Directors

		
	Dated: 3/15/14                                    
	HealthpointPartners, Healthpoint Capital Partners, LP, HealthpointCapital Partners II, LP

/s/ John Foster                
By:  

Dated: 3/15/14                        John Foster

/s/ John Foster                
By:  John Foster 

Dated: 3/15/14                        Mortimer Berkowitz, III 

/s/ Mortimer Berkowitz III        
By:  Mortimer Berkowitz III 

Dated: 3/15/14                        OrthoTec, LLC

/s/ Patrick Bertranou            
By:  Patrick Bertranou 

Dated: 3/15/14                        Patrick Bertanou 

/s/ Patrick Bertranou            
By:  Patrick Bertranou 

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Approved as to form:

		
	Dated: 3/15/14                          
	Munger, Tolles & Olson LLP, 

Counsel for Alphatec

/s/ Michael Doyen            
By:  Michael Doyen

Approved as to form:

		
	Dated: 3/15/14                          
	Mintz Levin Cohn Ferris Glovsky and Popeo PC, 

Counsel for Healthpoint 

/s/ Stephen C Curley            
By:  Stephen C Curley

Approved as to form:

Dated: 3/15/14                        Brown George Ross LLP
Counsel for OrthoTec

/s/ Peter W. Ross            
By:  Peter W. Ross

 

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Attachment A
March 15, 2014

		
	1.
	ATTACHMENT  PART OF BINDING TERM SHEET

		
	1.1.
	Reference is herein made to that certain Binding Term Sheet (the “Agreement”) by and among the Alphatec Holdings, Inc., the Healthpoint Parties, and the OrthoTec Parties (each as defined in the Agreement).  

		
	2.
	PAYMENT TERMS

		
	2.1.
	Alphatec shall pay to OrthoTec the following sums:

		
	2.2.
	Lump sum payment: By March 24, 2014, Alphatec shall make a payment of $1 million ($1,000,000.00) and by March 31 will pay an additional $750,000.00.  Within 25 days of Alphatec closing a suitable credit facility, but in no event later than June 15, 2014, Alphatec shall pay $15.75 million ($15,750,000.00).

		
	2.3.
	Quarterly payments:  $31.5 million ($31,500,000.00) payable in 29 quarterly installments of $1.1 million and then one additional quarterly payment of $600,000.00.  Each such quarterly payment shall be due on the first day of the quarter, commencing October 1, 2014.

		
	2.4.
	Interest: Simple Interest of 7% will accrue beginning May 15, 2014, on the unpaid balance of the $31.5 million ($31,500,000.00)  until such amount has been paid in full.  Following the full payment of the $31.5 million ($31,500.000.00), the accrued interest will be paid in quarterly installments of $1.1 million ($1,100,000.00)  until the accrued interest amount is paid (for clarity, it is understood that the final quarterly payment of interest may be less than $1.1 million ($1,100,00.00), but shall be sufficient to pay the accrued interest in full).  No interest shall accrue on the accrued interest.  In the event that $31.5 million ($31,500,000.00) is prepaid, interest shall not accrue on such prepaid amount.

Signature page to the Agreement re Plans, dated March 15, 2014

Dated: 3/15/14                        OrthoTec, LLC

/s/ Patrick Bertranou            
By:  Patrick Bertranou 

Dated: 3/15/14                        Patrick Bertanou 

/s/ Patrick Bertranou            
By:  Patrick Bertranou 

Dated: 3/15/14                        Alphatec Holdings, Inc. 

/s/ Les Cross                
By:  Les Cross
Alphatec Chairman and CEO 

Approved as to form:

		
	Dated: 3/15/14                                    
	Munger, Tolles & Olson LLP, 

Counsel for Alphatec

/s/ Michael Doyen            
By:  Michael Doyen

Approved as to form:

Dated: 3/15/14                                 Brown George Ross LLP
Counsel for OrthoTec

/s/ Peter W. Ross            
By:  Peter W. RossWU - 3.31.2014 - Ex 10.1

Exhibit 10.1

THE WESTERN UNION COMPANY
Incentive Award Acceptance Agreement

Pursuant to The Western Union Company Senior Executive Annual Incentive Plan (the “Plan”),  __________ (“the Participant”) has been identified as eligible to participate in the Plan for the Performance Period set forth below and has been determined to be eligible to receive the Incentive Award described below.  Certain terms and conditions of the Incentive Award are set forth immediately below in this Incentive Award Acceptance Agreement.  Other terms and conditions are set forth in the Incentive Award Agreement which is appended to this Incentive Award Acceptance Agreement.  The Incentive Award Acceptance Agreement and the Incentive Award Agreement are together the “Agreement” which is made and entered into between The Western Union Company, a Delaware corporation (“the Company”), and the Participant as of the beginning of the Performance Period set forth below.  Capitalized terms not otherwise defined in this Incentive Award Acceptance Agreement are defined in the Plan or the Incentive Award Agreement.  
	
		
	Maximum Award:
	___% of the Incentive Pool

	Target Award:
	______

	Performance Period:
	January 1, 2014 - December 31, 2014

	Incentive Pool:
	3.0% of Operating Income for fiscal year 2014 

	Vesting Date:
	Employment with the Company on the Payment Date
is a condition precedent to receipt of any portion of a 
bonus under the Plan (subject to the terms of The Western Union Company Severance/Change in Control Policy (Executive Committee Level).  

The Participant acknowledges receipt of copies of the Incentive Award Agreement, The Western Union Company Severance/Change in Control Policy (Executive Committee Level) (the “Severance/Change in Control Policy”), The Western Union Company Clawback Policy (the “Clawback Policy”) and the Plan (which are incorporated by reference and made a part hereof) and this Incentive Award Acceptance Agreement and agrees to abide by all of the terms and conditions of the Incentive Award Agreement, the Severance/Change in Control Policy, the Clawback Policy and the Plan.
In witness whereof, the parties have executed the Agreement as of __________, 2014. 

	
			
	 
	 
	THE WESTERN UNION COMPANY,

	 
	 
	a Delaware corporation

	 
	 
	 

	 
	By:
	 

	 
	Name:
	 

	 
	Title:
	 

	 
	 
	 

	Agreed and Accepted:
	 
	 

	 
	 
	 

	 
	 
	 

	Participant
	 
	 

INCENTIVE AWARD AGREEMENT
THE WESTERN UNION COMPANY 
SENIOR EXECUTIVE ANNUAL INCENTIVE PLAN

Pursuant to the provisions of The Western Union Company Senior Executive Annual Incentive Plan (the “Plan”), ____________ (the “Participant”),  has been identified as eligible to participate in the Plan for the Performance Period set forth in the Incentive Award Acceptance Agreement and has been determined to be eligible to receive an Incentive Award (the “Award”), upon and subject to the restrictions, terms and conditions set forth in the Incentive Award Acceptance Agreement, the Plan and below.  Capitalized terms not defined herein shall have the meanings specified in the Plan.  
1.Award Subject to Acceptance of Agreement.  The Award shall be null and void unless the Participant shall accept this Agreement by executing the Incentive Award Acceptance Agreement and returning it to the Company at such time as shall be satisfactory to the Company.

2.Service Vesting Requirement.  Except as otherwise determined by the Committee, if the Participant’s employment in his current position with the Company terminates for any reason prior to the date set forth in the Incentive Award Acceptance Agreement (the “Vesting Date”), the Participant shall not be entitled to receive the Incentive Award.
 
3.Committee Discretion.  Notwithstanding anything herein to the contrary, in all cases, the Committee shall have the sole and absolute discretion, taking into account such factors as the Committee deems appropriate, to determine the amount of the Award payable to the Participant (not to exceed the maximum award set forth in the Incentive Award Acceptance Agreement) or to decide that no payment shall be made.

4.Payment.  If the Committee certifies that the applicable Performance Measures have been achieved and has determined the amount and approved the payment of the Award to the Participant, the Participant shall receive, during the period beginning on January 1 and ending on March 15 (March 31, in the case of a Participant who is not a United States taxpayer) of the calendar year immediately following the year in which the Performance Period ends, a lump sum cash payment from the Company in an amount equal to the Award determined by the Committee, subject to the deduction of taxes and other amounts pursuant to the Plan, unless the Participant is eligible to and elects to defer a permissible portion of the Award into The Western Union Company Supplemental Incentive Savings Plan (“SISP”) by an election made no later than 6 months prior to end of the performance period.  All payments under this Agreement are intended to be exempt from Section 409A of the Code as “short-term deferrals,” within the meaning of Treasury regulations promulgated under Section 409A of the Code.

5.Withholding.  All payments under this Agreement are subject to withholding of any federal, state, local or other income, social insurance, payroll or other tax-related items which may be required to be withheld or paid in connection with such award.  

6.Award Confers No Rights to Continued Employment.  In no event shall the Participant’s eligibility for the Award or its acceptance by the Participant give or be deemed to give the Participant any right to continued employment by the Company, or any Subsidiary or Affiliate of the Company.

7.Nontransferability of Award.  The Award and any rights thereunder shall not be sold, transferred, assigned, pledged, hypothecated, encumbered or otherwise disposed of (whether by operation of law or otherwise) or be subject to execution, attachment or similar process.  

8.Agreement Subject to the Plan.  This Agreement is subject to the provisions of the Plan, the Severance/Change in Control Policy and the Clawback Policy and shall be interpreted in accordance therewith.  The Participant hereby acknowledges receipt of a copy of the Plan, the Severance/Change in Control Policy and the Clawback Policy. 
   
9.Meaning of Certain Terms.  As used herein, employment by the Company shall include employment by a Subsidiary or an Affiliate of the Company.

10.Administration.  The authority to administer and interpret this Agreement shall be vested in the Committee, and the Committee shall have all the powers with respect to this Agreement as it has with respect to the Plan.  Any interpretation, determination or other action made or taken by the Committee regarding the Plan or this Agreement shall be final, binding and conclusive.

11.Amendment and Termination.  The Committee may at any time amend or terminate the Plan.  The Committee may, in its sole discretion, reduce or eliminate the Award at any time and for any reason.  

12.Special 409A Provisions.  Notwithstanding any other provision of this Agreement to the contrary, if any payment hereunder is subject to section 409A of the Code and if such payment is to be paid on account of the Participant’s separation from service (within the meaning of section 409A of the Code), if the Participant is a specified employee (within the meaning of section 409A(a)(2)(B) of the Code), and if any such payment otherwise is required to be made prior to the first day of the seventh month following the Participant’s separation from service, such payment shall be delayed until the first day of the seventh month following the Participant’s separation from service.  To the extent that any payments or benefits under this Agreement are subject to section 409A of the Code and are paid or provided on account of the Participant’s termination of employment, the determination as to whether the Participant has had a termination of employment (or separation from service) shall be made in accordance with section 409A and the guidance issued thereunder.  

13.Governing Law.  This Agreement, the Award and all determinations made and actions taken pursuant hereto and thereto, to the extent not otherwise governed by the laws of the United States, shall be governed by the laws of the State of Delaware and construed in accordance therewith without giving effect to the conflicts of laws principles.

14.Statute of Limitations.  Any action, claim or lawsuit relating to this Agreement must be filed no more than 6 months after the date of the event that is the subject of the action, claim or lawsuit.  The Participant voluntarily waives any statute of limitations to the contrary.

15.Clawback Policy.  Notwithstanding any provision of this Agreement to the contrary, if the Board determines that any Incentive Compensation (as defined in the Company’s Clawback Policy) received by or paid to the Participant resulted from any financial result or performance metric that was impacted by the Participant’s misconduct or fraud and that compensation should be recovered from the Participant (such amount being recovered, the “Clawbacked Compensation”), then upon such determination, the Board may recover such Clawbacked Compensation by (a) cancelling all or any portion of the Award (the “Clawbacked Portion”) and, in such case, the Participant shall not be entitled to receive the Clawbacked Portion of the Award and the Clawbacked Portion of the Award shall automatically and without further action of the Company be cancelled, (b) requiring the Participant to repay to the Company any portion of the Clawbacked Portion of the Award the Participant has already received or (c) any combination of the remedies set forth in clauses (a) or (b).   The foregoing remedies are in addition to and separate from any other relief available to the Company due to the Participant’s misconduct or fraud.  Any determination by the Board with respect to the foregoing shall be final, conclusive and binding upon the Participant and all persons claiming through the Participant.

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