Xtant Medical Reports Second Quarter 2016 Results *See footnote about the use of pro forma financial information Second Quarter 2016 Highlights: Core recurring revenue (excluding OEM and other revenue) increased 5.6% to

Xtant Medical Reports Second

Quarter 2016 Results

*See footnote about the use of pro forma financial

Second Quarter 2016 Highlights:

BELGRADE, Mont., Aug 01, 2016 (GLOBE NEWSWIRE)

-- Xtant Medical Holdings, Inc. (NYSE MKT:XTNT), a leader in the development of regenerative medical devices, today reported

its financial results for the three months ended June 30th, 2016. The Company reported quarterly revenues of approximately $21.5

million and an EBITDA gain of approximately $332,973.

Second quarter 2016 revenue was approximately

$21.5 million compared to pro forma revenue of approximately $21.6 million for the same period during 2015. Core recurring revenue,

which excludes other revenue and revenue associated with Original Equipment Manufacturer (OEM) customers, increased 5.6 %

Gross profit for the second quarter

of 2016 was $14.7 million or 68.5% of revenue, compared to pro forma gross profit of $14.0 million or 64.9% of revenues for the

second quarter of 2015.

Sales and Marketing Expenses

Second quarter 2016 sales and marketing expenses

increased to $10.4 million, as compared to pro forma sales and marketing expenses of $9.3 million during the same period in

2015. For the quarter, sales and marketing as a percentage of revenues increased to 48.6%, compared to 43.1% in the second

quarter of 2015, on a pro forma basis. The increase was mainly due to the higher OEM revenue in the second quarter of

2015 which has no associated sales commissions. In addition, as part of its growth strategy, the Company increased its sales

infrastructure to support the portfolio selling opportunity of the combined business.

General and Administrative Expenses

In the second quarter, general and administrative

expenses decreased slightly to $3.9 million compared to pro forma general and administrative expenses of $4.0 million, for the

same period last year. As a percentage of revenue, general and administrative expenses were 18.2% during the period as compared

to pro forma 18.3% for the same period during 2015.

Second quarter 2016 consolidated net loss remained

flat at $4.5 million, compared to the pro forma year-ago period.

The Company defines earnings before interest, taxes,

depreciation and amortization ("EBITDA") as net income/loss from operations before depreciation, amortization, impairment

charges, non-recurring expenses and non-cash stock-based compensation. Consolidated EBITDA for the second quarter of 2016 was a

gain of $332,973 compared to an EBITDA loss of $144,749 for the first quarter of this year.

Cash on hand as of June 30, 2016, was $2.2 million,

as compared to $6.4 million as of December 31, 2015. This figure excludes cash resources available to be drawn down by the Company

through its accounts receivable facility with Silicon Valley Bank and its equity credit facility with Aspire Capital.

The Company decreased its full year 2016 revenue

guidance based on the following:

**Non-GAAP profitability is defined as EBITDA less

total cash based interest expense.

Conference Call to be Held August 2, 2016

An accompanying conference call will be hosted by

Dan Goldberger, Chief Executive Officer, and John Gandolfo, Chief Financial Officer, to discuss the results. The call will be held

at 10:00 AM ET, on August 2, 2016. Please refer to the information below for conference call dial-in information and webcast registration.

Conference date: August 2, 2016, 10:00 AM ET

Conference dial-in: 877-269-7756

International dial-in: 201-689-7817

Conference Call Name: Xtant Medical's

Second Quarter 2016 Results Call Webcast Registration: Click Here

Following the live call, a replay will

be available on the Company's website, www.xtantmedical.com,

under "Investor Info."

*Use of Pro Forma Financial Information

On July 31, 2015, Bacterin International Holdings,

Inc. acquired all of the issued and outstanding stock of X-Spine Systems, Inc. and the combined company was renamed Xtant Medical

Holdings, Inc. Except for the financial results for the three months ended June 30, 2016, the results presented are on a pro forma

basis as if the two companies were combined for the periods shown. Certain pro forma adjustments have been made to reflect the

impact of the purchase transaction, primarily consisting of amortization of intangible assets with determinable lives and interest

expense on long-term debt. In addition, certain historical expenses, such as warrant expense and interest expense associated with

debt that was immediately repaid, were eliminated from these pro-forma results. The pro forma information does not necessarily

reflect the actual results of operations had the acquisition been consummated at the beginning of the fiscal reporting period indicated

nor is it indicative of future operating results. The pro forma information does not include any adjustment for potential revenue

enhancements, cost synergies or other operating efficiencies that could result from the acquisition.

Additional information regarding the business combination

and its impact on the Company's financial position will be set forth in the Company's Form 10-Q for the quarter ended

June 30, 2016, which will be filed with the Securities and Exchange Commission on or about August 8, 2016 and will include the

Company's unaudited consolidated financial statements as of and for the quarters ended June 30, 2016 and June 30, 2015.

Medical Holdings, Inc.

Xtant Medical Holdings, Inc. (NYSE

MKT:XTNT) develops, manufactures and markets class-leading regenerative medicine products and medical devices for domestic and

international markets. Xtant products serve the specialized needs of orthopedic and neurological surgeons, including orthobiologics

for the promotion of bone healing, implants and instrumentation for the treatment of spinal disease, tissue grafts for the treatment

of orthopedic disorders, and biologics to promote healing following cranial, and foot and ankle surgeries. With core competencies

in both biologic and non-biologic surgical technologies, Xtant can leverage its resources to successfully compete in global neurological

and orthopedic surgery markets. For further information, please visit www.xtantmedical.com.

Important Cautions Regarding Forward-looking Statements

This press release contains certain disclosures

that may be deemed forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are

subject to significant risks and uncertainties. Forward-looking statements include statements that are predictive in nature, that

depend upon or refer to future events or conditions, or that include words such as "continue," "efforts," "expects,"

"anticipates," "intends," "plans," "believes," "estimates," "projects,"

"forecasts," "strategy," "will," "goal," "target," "prospects," "potential,"

"optimistic," "confident," "likely," "probable" or similar expressions or the negative

Statements of historical fact also may be deemed

to be forward-looking statements. We caution that these statements by their nature involve risks and uncertainties, and actual

results may differ materially depending on a variety of important factors, including, among others: our ability to integrate the

acquisition of X-spine Systems, Inc. and any other business combinations or acquisitions successfully; our ability to remain listed

on the NYSE MKT; our ability to obtain financing on reasonable terms; our ability to increase revenue; our ability to comply with

the covenants in our credit facility; our ability to maintain sufficient liquidity to fund our operations; the ability of our sales

force to achieve expected results; our ability to remain competitive; government regulations; our ability to innovate and develop

new products; our ability to obtain donor cadavers for our products; our ability to engage and retain qualified technical personnel

and members of our management team; the availability of our facilities; government and third-party coverage and reimbursement for

our products; our ability to obtain regulatory approvals; our ability to successfully integrate recent and future business combinations

or acquisitions; our ability to use our net operating loss carry-forwards to offset future taxable income; our ability to deduct

all or a portion of the interest payments on the notes for U.S. federal income tax purposes; our ability to service our debt; product

liability claims and other litigation to which we may be subjected; product recalls and defects; timing and results of clinical

studies; our ability to obtain and protect our intellectual property and proprietary rights; infringement and ownership of intellectual

property; our ability to remain accredited with the American Association of Tissue Banks; influence by our management; our ability