Exhibit 10.8


 


THIS SUBORDINATED CONVERTIBLE NOTE IS SUBJECT, IN ALL RESPECTS TO
THE SUBORDINATION AGREEMENT DATED MARCH 31, 2010 BY AND AMONG
HEALTHPOINTCAPITAL PARTNERS II, L.P., EACH OF THE ENTITIES LISTED ON THE
SIGNATURE PAGE ATTACHED THERETO, AND MIDCAP FUNDING I, LLC, AS AGENT FOR THE
SENIOR LENDERS REFERRED TO THEREIN.


 


AMENDED AND
RESTATED 


SUBORDINATED
CONVERTIBLE NOTE


 


$36,869,813.00


 


September 30, 2010


 


FOR VALUE RECEIVED, BIOHORIZONS, INC., a
Delaware corporation (“Borrower”), promises to pay to HEALTHPOINTCAPITAL
Partners II, LP, a Delaware limited partnership (“Lender”), at its principal
offices at 505 Park Avenue, 12th Floor, New
York, New York 10022 or such other location as Lender may designate, the
principal amount of THIRTY-SIX MILLION EIGHT HUNDRED SIXTY-NINE THOUSAND EIGHT
HUNDRED THIRTEEN DOLLARS (U.S. $36,869,813.00) (the “Principal Amount”), plus
interest accrued and accruing from and after December 31, 2009, and any
other amounts that may be due hereunder, upon the terms and conditions
specified below.


 


THIS AMENDED AND RESTATED SUBORDINATED CONVERTIBLE
NOTE REPLACES IN ITS ENTIRETY THAT CERTAIN SUBORDINATED CONVERTIBLE NOTE DATED
JANUARY 1, 2010 MADE BY BORROWER TO LENDER, OF LIKE TENOR HEREWITH.


 


TERMS OF THIS NOTE


 


1.                                       Interest. Interest
shall be due or payable under this Note at the rate of ten percent (10.0%) per
annum, calculated from and after December 31, 2009. Interest shall be
paid, in the sole discretion of Lender, in either cash or Conversion Units (as
hereinafter defined). The Principal Amount, together with interest payable
thereon and any and all costs and expenses that may become due pursuant to
paragraph 6 hereof, is referred to herein as the “Note Amount.”


 


2.                                       Repayment. The entire
unpaid Note Amount shall be due and payable on the earlier to occur of (i) an
initial public offering of Borrower’s capital stock, (ii) a merger,
consolidation or similar transaction resulting in a change of control of
Borrower, a sale of all or substantially all of the Borrower’s assets, a sale
of a majority of Borrower’s capital stock, or any other change of control of
Borrower, in each case occurring in one transaction or a series of related
transactions, or (iii) upon demand by Lender at any time on or after April 1,
2012.


 


3.                                       Optional Conversion. Any time
prior to the full repayment of this Note pursuant to paragraph 2 hereof, Lender
may, at its sole discretion, convert all or part of the then outstanding Note
Amount into that number of units consisting of shares of common stock and
preferred stock of Borrower (or equivalent securities) (the “Conversion
Units”), as equals (i) such Note Amount divided by (ii) the per unit
price (the “Conversion Unit Price”) calculated by valuing Borrower’s currently
outstanding shares of common and preferred stock (on a fully diluted and fully
converted basis) at $500 million. Any fraction of a share resulting from this
calculation shall be rounded upward or downward to the nearest whole share. The
conversion right described in this paragraph 3 may be exercised by Lender by
delivery of a written notice to


 

















 


Borrower, and the conversion shall be deemed to be
effective on the date that Borrower receives such written notice.


 


4.                                            Prepayment. At the
election of Borrower, this Note may be prepaid in full or in part at any time
without penalty.


 


5.                                            Events of
Acceleration. The entire unpaid Note Amount shall become
immediately due and payable upon the insolvency of the Borrower; the filing of
a petition in bankruptcy by Borrower; the execution by Borrower of a general assignment
for the benefit of creditors; the filing by or against Borrower of a petition
in bankruptcy or a petition for relief under the provisions of the federal
bankruptcy act or another state or federal law for the relief of debtors and
the continuation of such petition without dismissal for a period of sixty (60)
days or more; or Borrower’s ceasing to carry on business.


 


6.                                            Collection. If action is
instituted to collect this Note, Borrower promises to pay to Lender all
reasonable costs and expenses (including reasonable attorneys’ fees) incurred
in connection with such action, which amounts shall constitute part of the
“Note Amount”.


 


7.                                            Default
Interest. In the event this Note is not paid in full when
due, interest shall be payable on the outstanding Principal Amount at the rate
of fifteen percent (15%) per annum, accruing monthly, calculated from and after
the date of this Note.


 


8.                                            Subordination.
Notwithstanding anything to the contrary set forth herein, this Note shall be
subordinated and subject in right and time of payment to the payment in full of
all obligations of Borrower and/or its subsidiaries for borrowed money from any
bank, commercial lender or other financial institution, together with any
interest accruing thereon after the commencement of a bankruptcy proceeding,
without regard to whether or not such interest is an allowed claim (the “Senior
Indebtedness”). Each holder of the Senior Indebtedness, whether now outstanding
or hereafter created, incurred, assumed or guaranteed, shall be deemed to have
acquired Senior Indebtedness in reliance upon the provisions contained in this
Note.


 


9.                                            Waivers. No delay on
the part of Lender in exercising any right or remedy hereunder shall operate as
a waiver of such right or remedy. No single or partial exercise of a right or
remedy shall preclude other or further exercise of that or any other right or
remedy. The failure of Lender to insist upon the strict performance of any term
of this Note, or to exercise any right or remedy hereunder, shall not be construed
as a waiver or relinquishment by Lender for the future of that term, right or
remedy. No waiver of any right of Lender hereunder shall be effective unless in
writing executed by the Lender. The parties hereby expressly waive presentment,
demand for payment, dishonor, notice of dishonor, protest, notice of protest,
and any other formality.


 


10.                                 Interest
Savings Clause. If any interest payment (or other payment which is
deemed by law to be interest) is due hereunder is determined to be in excess of
the then legal maximum rate, then that portion of each interest payment
representing an amount in excess of the then legal maximum rate shall instead
be deemed a payment of principal and applied against the principal of the
obligations evidenced by this Note.


 


11.                                 Severability. The
unenforceability or invalidity of any provision or provisions of this Note as
to any persons or circumstances shall not render that provision or those
provisions unenforceable or invalid as to any other provisions or
circumstances, and all provisions hereof, in all other respects, shall remain
valid and enforceable.


 


2

















 


12.                            Governing Law. This Note
shall be governed by and construed under the laws of the State of New York as
applied to agreements among New York residents entered into and to be performed
entirely within New York.


 


	
   

  	
  BIOHORIZONS, INC. 

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ David Wall

  
	
   

  	
   

  	
  Name: David Wall

  
	
   

  	
   

  	
  Title: CFO

  



 


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