# **Exhibit 10.73**

 

# **CRDENTIA CORP.**

#  

**NOTICE OF RESTRICTED STOCK BONUS AWARD**

 
| Grantee’s Name  and Address: |   | James D. Durham              |
|-----------------------------------|--------|-----------------------------------|
|                              |   | 5001  LBJ Freeway, Suite 850 |
|                              |   | Dallas, Texas 75244               |

 

You(the “Grantee”) have been granted shares of Common Stock of the Company (the “Award”),subject to the terms and conditions of this Notice of Restricted Stock BonusAward (the “Notice”) and the Restricted Stock Bonus Award Agreement (the “Agreement”)attached hereto, as follows. Unless otherwise defined herein, the terms definedin the Agreement shall have the same defined meanings in this Notice.

 
| Date of Award                                                            |   | March 24, 2006 |    |
|--------------------------------------------------------------------------|--------|----------------|---------|
|                                                                     |   |           |    |
| Vesting  Commencement Date                                               |   | March 24, 2006 |    |
|                                                                     |   |           |    |
| Total Number of  Shares of Common Stock Awarded (the “Shares”) |   | 150,000        |    |
|                                                                     |   |           |    |
| Aggregate Fair  Market                                                   |   |           |    |
| Value of the  Shares                                                     |   | $              | 675,000 |   |
|                                                                          |        |                |         |  |

 

Vesting Schedule:

 

Subjectto the Grantee’s Continuous Service and other limitations set forth in thisNotice and the Agreement, the Shares will “vest” in accordance with thefollowing schedule:

 

Subject to thelimitations of the following paragraph, the Shares shall vest over a four-yearperiod with 25% of the Shares vesting on the 1st anniversary of theVesting Commencement Date and 1/48 of the Shares shall vest on each monthlyanniversary of the Vesting Commencement Date thereafter.

 

Notwithstandingthe foregoing, the Shares shall not vest unless the average daily tradingvolume for the Company’s Common Stock over any consecutive thirty (30) dayperiod equals or exceeds 33,333 shares (the “Trading Volume Goal”). In theevent the Trading Volume Goal is achieved, the Shares shall vest in accordancewith the schedule of the prior paragraph even if the average daily tradingvolume for the Company’s Common Stock over any consecutive thirty (30) dayperiod after the achievement of the Trading Volume Goal is less than 33,333shares.

 

In theevent the Grantee’s Continuous Service terminates as a result of his or herdeath or Disability, the Shares automatically shall become fully vestedimmediately prior to the date of such termination of Continuous Service.

 

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Duringany authorized leave of absence, the vesting of the Shares as provided in thisschedule shall be suspended after the leave of absence exceeds a period ofthree (3) months. Vesting of the Shares shall resume upon the Grantee’stermination of the leave of absence and return to service to the Company or aRelated Entity. The Vesting Schedule of the Shares shall be extended by thelength of the suspension.

 

In theevent of the Grantee’s change in status from Employee, Director or Consultantto any other status of Employee, Director or Consultant, the Shares shallcontinue to vest in accordance with the Vesting Schedule set forth above.

 

TheAward shall be subject to the provisions of Section 14 of the Agreementrelating to the vesting of the Shares in the event of a Corporate Transaction.

 

Forpurposes of this Notice and the Agreement, the term “vest” shall mean, withrespect to any Shares, that such Shares are no longer subject to forfeiture tothe Company. Shares that have not vested are deemed “Restricted Shares.”  If the Grantee would become vested in afraction of a Restricted Share, such Restricted Share shall not vest until theGrantee becomes vested in the entire Share.

 

Vestingshall cease upon the date of termination of the Grantee’s Continuous Servicefor any reason, other than death or Disability. In the event the Grantee’sContinuous Service is terminated for any reason, other than death orDisability, any Restricted Shares held by the Grantee immediately followingsuch termination of Continuous Service shall be deemed reconveyed to theCompany and the Company shall thereafter be the legal and beneficial owner ofthe Restricted Shares and shall have all rights and interest in or relatedthereto without further action by the Grantee. The foregoing forfeitureprovisions set forth in this Notice as to Restricted Shares shall apply to thenew capital stock or other property (including cash paid other than as a regularcash dividend) received in exchange for the Shares in consummation of any transactiondescribed in Section 14 of the Agreement and such stock or property shall bedeemed Additional Securities for purposes of the Agreement, but only to theextent the Shares are at the time covered by such forfeiture provisions.

 

INWITNESS WHEREOF, the Company and the Grantee have executed this Notice andagree that the Award is to be governed by the terms and conditions of thisNotice and the Agreement.

 
|   |   | Crdentia Corp.,                 |
|--------|--------|---------------------------------|
|   |   | a Delaware  corporation         |
|   |   |                            |
|   |   | By:                             | /s/ James J.  TerBeest |   |
|   |   |                            |
|   |   | Title: Chief  Financial Officer |

 

THE GRANTEE ACKNOWLEDGESAND AGREES THAT THE SHARES SHALL VEST, IF AT ALL, ONLY DURING THE PERIOD OF THEGRANTEE’S CONTINUOUS SERVICE (NOT THROUGH THE ACT OF BEING HIRED, BEING GRANTEDTHIS AWARD OR ACQUIRING SHARES HEREUNDER). THE GRANTEE FURTHER ACKNOWLEDGES ANDAGREES THAT NOTHING IN THIS NOTICE NOR THE AGREEMENT SHALL CONFER UPON THEGRANTEE ANY RIGHT WITH RESPECT TO CONTINUATION OF

 

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THE GRANTEE’S CONTINUOUSSERIVCE, NOR SHALL IT INTERFERE IN ANY WAY WITH THE GRANTEE’S RIGHT OR THECOMPANY’S RIGHT TO TERMINATE THE GRANTEE’S CONTINUOUS SERIVCE AT ANY TIME, WITHOR WITHOUT CAUSE, AND WITH OR WITHOUT NOTICE. THE GRANTEE ACKNOWLEDGES THATUNLESS THE GRANTEE HAS A WRITTEN EMPLOYMENT AGREEMENT WITH THE COMPANY TO THECONTRARY, THE GRANTEE’S STATUS IS AT WILL.

 

As acondition to receiving the Shares, the Grantee agrees to refrain from making anelection pursuant to Section 83(b) of the Code with respect to the Shares.

 

TheGrantee acknowledges receipt of the Agreement and represents that he or she isfamiliar with the terms and provisions thereof, and hereby accepts the Awardsubject to all of the terms and provisions hereof and thereof. The Grantee hasreviewed this Notice and the Agreement in their entirety, has had anopportunity to obtain the advice of counsel prior to executing this Notice andfully understands all provisions of this Notice and the Agreement. The Granteehereby agrees that all questions of interpretation and administration relatingto this Notice and the Agreement shall be resolved by the Board in accordancewith Section 11 of the Agreement. The Grantee further agrees to the venueselection and waiver of a jury trial in accordance with Section 12 of theAgreement. The Grantee further agrees to notify the Company upon any change inthe residence address indicated in this Notice.

 
| Dated: March 24,  2006 | Signed: | /s/ James D.  Durham |   |
|------------------------|---------|----------------------|--------|

 

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**Award Number:                               **

 

**CRDENTIA CORP.**

 

**RESTRICTED STOCK BONUS AWARD AGREEMENT**

 

# 1.             Issuance of Shares. Crdentia,a Delaware corporation (the “Company”), hereby issues to the Grantee (the “Grantee”)named in the Notice of Restricted Stock Bonus Award (the “Notice”), the TotalNumber of Shares of Common Stock Awarded set forth in the Notice (the “Shares”),subject to the Notice and this Restricted Stock Bonus Award Agreement (the “Agreement”).All Shares issued hereunder will be deemed issued to the Grantee as fully paidand nonassessable shares, and the Grantee will have the right to vote theShares at meetings of the Company’s stockholders. The Company shall pay anyapplicable stock transfer taxes imposed upon the issuance of the Shares to theGrantee hereunder.

#  

# 2.             Transfer Restrictions. TheShares issued to the Grantee hereunder may not be sold, transferred by gift,pledged, hypothecated, or otherwise transferred or disposed of by the Granteeprior to the date when the Shares become vested pursuant to the VestingSchedule set forth in the Notice. Any attempt to transfer Restricted Shares inviolation of this Section 2 will be null and void and will be disregarded.

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# 3.             Escrow of Stock. Forpurposes of facilitating the enforcement of the provisions of this Agreement,the Grantee agrees, immediately upon receipt of the certificate(s) for theRestricted Shares, to deliver such certificate(s), together with an AssignmentSeparate from Certificate in the form attached hereto as Exhibit A,executed in blank by the Grantee with respect to each such stock certificate,to the Secretary or Assistant Secretary of the Company, or their designee, tohold in escrow for so long as such Restricted Shares have not vested pursuantto the Vesting Schedule set forth in the Notice, with the authority to take allsuch actions and to effectuate all such transfers and/or releases as may benecessary or appropriate to accomplish the objectives of this Agreement inaccordance with the terms hereof. The Grantee hereby acknowledges that theappointment of the Secretary or Assistant Secretary of the Company (or theirdesignee) as the escrow holder hereunder with the stated authorities is amaterial inducement to the Company to make this Agreement and that suchappointment is coupled with an interest and is accordingly irrevocable. TheGrantee agrees that such escrow holder shall not be liable to any party hereto(or to any other party) for any actions or omissions unless such escrow holderis grossly negligent relative thereto. The escrow holder may rely upon anyletter, notice or other document executed by any signature purported to begenuine and may resign at any time. Upon the vesting of Restricted Shares, theescrow holder will, without further order or instruction, transmit to theGrantee the certificate evidencing such Shares.

 

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# 4.             Additional Securities andDistributions.

#  

## (a)           Any securities or cash received(other than a regular cash dividend) as the result of ownership of theRestricted Shares (the “Additional Securities”), including, but not by way oflimitation, warrants, options and securities received as a stock dividend orstock split, or as a result of a recapitalization or reorganization or othersimilar change in the Company’s capital structure, shall be retained in escrowin the same manner and subject to the same conditions and restrictions as theRestricted Shares with respect to which they were issued, including, withoutlimitation, the Vesting Schedule set forth in the Notice. The Grantee shall beentitled to direct the Company to exercise any warrant or option received asAdditional Securities upon supplying the funds necessary to do so, in whichevent the securities so purchased shall constitute Additional Securities, butthe Grantee may not direct the Company to sell any such warrant or option. IfAdditional Securities consist of a convertible security, the Grantee mayexercise any conversion right, and any securities so acquired shall constituteAdditional Securities. In the event of any change in certificates evidencingthe Shares or the Additional Securities by reason of any recapitalization,reorganization or other transaction that results in the creation of AdditionalSecurities, the escrow holder is authorized to deliver to the issuer thecertificates evidencing the Shares or the Additional Securities in exchange forthe certificates of the replacement securities.

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## (b)           The Company shall disburse to theGrantee all regular cash dividends with respect to the Shares and AdditionalSecurities (whether vested or not), less any applicable withholdingobligations.

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# 5.             Taxes.

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## (a)           No Section 83(b) Election.As a condition to receiving the Shares, the Grantee agrees to refrain frommaking an election pursuant to Section 83(b) of the Code with respect tothe Shares.

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## (b)           Tax Liability. The Grantee is ultimately liable andresponsible for all taxes owed by the Grantee in connection with the Award,regardless of any action the Company or any Related Entity takes with respect to any tax withholdingobligations that arise in connection with the Award. Neither the Company nor any Related Entity makes anyrepresentation or undertaking regarding the treatment of any tax withholding inconnection with the grant or vesting of the Award or the subsequent sale ofShares subject to the Award. The Company and its Related Entities do not commit and are under no obligationto structure the Award to reduce or eliminate the Grantee’s tax liability.

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## (c)           Payment of Withholding Taxes. Prior to any event in connectionwith the Award (e.g., vesting) that the Company determines may result in anytax withholding obligation, whether United States federal, state, local ornon-U.S., including any employment tax obligation (the “Tax WithholdingObligation”), the Grantee must arrange for the satisfaction of the minimumamount of such Tax Withholding Obligation in a manner acceptable to theCompany.

 

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### (i)            *By Share Withholding.*The Grantee authorizes the Company to,upon the exercise of its sole discretion, withhold from those Shares issuableto the Grantee the whole number of Shares sufficient to satisfy the minimumapplicable Tax Withholding Obligation. The Grantee acknowledges that thewithheld Shares may not be sufficient to satisfy the Grantee’s minimum TaxWithholding Obligation. Accordingly, the Grantee agrees to pay to the Companyor any Related Entity as soon aspracticable, including through additional payroll withholding, any amount ofthe Tax Withholding Obligation that is not satisfied by the withholding ofShares described above.

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### (ii)           *By Sale of Shares*. Unless the Granteedetermines to satisfy the Tax Withholding Obligation by some other means inaccordance with clause (iii) below, the Grantee’s acceptance of this Awardconstitutes the Grantee’s instruction and authorization to the Company and anybrokerage firm determined acceptable to the Company for such purpose to sell onthe Grantee’s behalf a whole number of Shares from those Shares issuable to theGrantee as the Company determines to be appropriate to generate cash proceedssufficient to satisfy the minimum applicable Tax Withholding Obligation. SuchShares will be sold on the day such Tax Withholding Obligation arises (e.g., avesting date) or as soon thereafter as practicable. The Grantee will beresponsible for all broker’s fees and other costs of sale, and the Granteeagrees to indemnify and hold the Company harmless from any losses, costs,damages, or expenses relating to any such sale. To the extent the proceeds ofsuch sale exceed the Grantee’s minimum Tax Withholding Obligation, the Companyagrees to pay such excess in cash to the Grantee. The Grantee acknowledges thatthe Company or its designee is under no obligation to arrange for such sale atany particular price, and that the proceeds of any such sale may not besufficient to satisfy the Grantee’s minimum Tax Withholding Obligation. Accordingly,the Grantee agrees to pay to the Company or any Related Entity as soon as practicable,including through additional payroll withholding, any amount of the TaxWithholding Obligation that is not satisfied by the sale of Shares describedabove.

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### (iii)          *By Check, Wire Transfer or Other Means*. Atany time not less than five (5) business days (or such fewer number of businessdays as determined by the Board) before any Tax Withholding Obligation arises(e.g., a vesting date), the Grantee may elect to satisfy the Grantee’s TaxWithholding Obligation by delivering to the Company an amount that the Companydetermines is sufficient to satisfy the Tax Withholding Obligation by(x) wire transfer to such account as the Company may direct,(y) delivery of a certified check payable to the Company, or (z) suchother means as specified from time to time by the Board.

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# 6.             Stop-Transfer Notices. Inorder to ensure compliance with the restrictions on transfer set forth in thisAgreement or the Notice, the Company may issue appropriate “stop transfer”instructions to its transfer agent, if any, and, if the Company transfers itsown securities, it may make appropriate notations to the same effect in its ownrecords.

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# 7.             Refusal to Transfer. TheCompany shall not be required (i) to transfer on its books any Shares thathave been sold or otherwise transferred in violation of any of the provisionsof this Agreement or (ii) to treat as owner of such Shares or to accordthe right to vote or pay dividends to any purchaser or other transferee to whomsuch Shares shall have been so transferred.

 

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# 8.             Restrictive Legends. TheGrantee understands and agrees that the Company shall cause the legends setforth below or legends substantially equivalent thereto, to be placed upon anycertificate(s) evidencing ownership of the Shares together with any otherlegends that may be required by the Company or by state or federal securitieslaws:

#  

THESHARES REPRESENTED BY THIS CERTIFICATE ARE RESTRICTED BY THE TERMS OF THATCERTAIN RESTRICTED STOCK BONUS AWARD AGREEMENT BETWEEN THE COMPANY AND THENAMED STOCKHOLDERS. THE SHARES REPRESENTED BY THIS CERTIFICATE MAY BETRANSFERRED ONLY IN ACCORDANCE WITH SUCH AGREEMENT, A COPY OF WHICH IS ON FILEWITH THE SECRETARY OF THE COMPANY.

 

# 9.             Entire Agreement: Governing Law.The Notice and this Agreement constitute the entire agreement of the partieswith respect to the subject matter hereof and supersede in their entirety allprior undertakings and agreements of the Company and the Grantee with respectto the subject matter hereof, and may not be modified adversely to the Grantee’sinterest except by means of a writing signed by the Company and the Grantee. Theseagreements are to be construed in accordance with and governed by the internallaws of the State of Texas without giving effect to any choice of law rule thatwould cause the application of the laws of any jurisdiction other than theinternal laws of the State of Texas to the rights and duties of the parties. Shouldany provision of the Notice or this Agreement be determined to be illegal orunenforceable, the other provisions shall nevertheless remain effective andshall remain enforceable.

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# 10.           Headings. The captions used inthis Agreement are inserted for convenience and shall not be deemed a part ofthis Agreement for construction or interpretation.

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# 11.           Administration and Interpretation.Any question or dispute regarding the administration or interpretation of theNotice or this Agreement shall be submitted by the Grantee or by the Company tothe Board. The resolution of such question or dispute by the Board shall befinal and binding on all persons.

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# 12.           Venue and Waiver of Jury Trial.The parties agree that any suit, action, or proceeding arising out of orrelating to the Notice or this Agreement shall be brought in the United StatesDistrict Court for the Northern District of Texas (or should such court lackjurisdiction to hear such action, suit or proceeding, in a Texas state court inthe County of Dallas) and that the parties shall submit to the jurisdiction ofsuch court. The parties irrevocably waive, to the fullest extent permitted bylaw, any objection the party may have to the laying of venue for any such suit,action or proceeding brought in such court. THE PARTIES ALSO EXPRESSLY WAIVEANY RIGHT THEY HAVE OR MAY HAVE TO A JURY TRIAL OF ANY SUCH SUIT, ACTION ORPROCEEDING. If any one or more provisions of this Section 12 shall for anyreason be held invalid or unenforceable, it is the specific intent of theparties that such provisions shall be modified to the minimum extent necessaryto make it or its application valid and enforceable.

 

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# 13.           Notices. Any notice requiredor permitted hereunder shall be given in writing and shall be deemedeffectively given upon personal delivery, upon deposit for delivery by aninternationally recognized express mail courier service or upon deposit in theUnited States mail by certified mail (if the parties are within the UnitedStates), with postage and fees prepaid, addressed to the other party at itsaddress as shown in these instruments, or to such other address as such partymay designate in writing from time to time to the other party.

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# 14.           Corporate Transaction.

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## (a)           In the event of a Corporate Transactionand for the portion of the Award that is neither Assumed nor Replaced, (i) suchportion of the Award shall automatically become fully vested for all of theShares at the time represented by such portion of the Award, immediately priorto the specified effective date of such Corporate Transaction, provided thatthe Grantee’s Continuous Service has not terminated prior to such date and (ii) theAward shall be subject to the terms of the agreement implementing the CorporateTransaction between the Company and the successor entity or Parent thereof andthe Grantee shall be deemed to have agreed to the terms of such agreementapplicable to the Award.

##  

## (b)           In the event of a CorporateTransaction and for the portion of the Award that is Assumed or Replaced, thenthe Award (if Assumed), the replacement award (if Replaced), or the cashincentive program (if Replaced) automatically shall become fully vested,exercisable and payable for all of the Shares at the time represented by suchAssumed or Replaced portion of the Award, immediately upon termination of theGrantee’s Continuous Service if such Continuous Service is terminated, withinfive (5) years after the Corporate Transaction, by the successor company, theCompany or a Related Entity without Cause or voluntarily by the Grantee withGood Reason. Notwithstanding the foregoing, if upon the consummation of aCorporate Transaction the Award is Replaced, the Award shall terminate and anyRestricted Shares held by the Grantee shall be deemed reconveyed to the Companyas if the Grantee’s Continuous Service had terminated immediately prior to theeffective date of such Corporate Transaction.

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# 15.           Definitions. As used herein,the following definitions shall apply:

#  

## (a)           “Applicable Laws” means thelegal requirements applicable to the issuance of Awards, if any, underapplicable provisions of federal securities laws, state corporate andsecurities laws, the Code, the rules of any applicable stock exchange ornational market system, and the rules of any non-U.S. jurisdiction applicableto Awards granted to residents therein.

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## (b)           “Assumed” means that pursuantto a Corporate Transaction either (i) the Award is expressly affirmed bythe Company or (ii) the contractual rights and obligations represented bythe Award are expressly assumed (and not simply by operation of law) by thesuccessor entity or its Parent in connection with the Corporate Transactionwith appropriate adjustments to the number and type of securities of thesuccessor entity or its Parent subject to the Award and the exercise orpurchase price thereof which at least preserves the compensation element of theAward existing at the time of the Corporate Transaction as determined inaccordance with the instruments evidencing the agreement to assume the Award.

 

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## (c)           “Award” means the sale ofRestricted Shares hereunder.

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## (d)           “Board” means the Board ofDirectors of the Company and shall include any committee of the Board orOfficer of the Company to which the Board has delegated its authority underthis Agreement.

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## (e)           “Cause” means, with respect tothe termination by the Company or a Related Entity of the Grantee’s ContinuousService, that such termination is for “Cause” as such term is expressly definedin a then-effective written agreement between the Grantee and the Company orsuch Related Entity, or in the absence of such then-effective written agreementand definition, is based on, in the determination of the Board, the Grantee’s:  (i) performance of any act or failure toperform any act in bad faith and to the detriment of the Company or a RelatedEntity; (ii) dishonesty, intentional misconduct or material breach of anyagreement with the Company or a Related Entity; or (iii) commission of acrime involving dishonesty, breach of trust, or physical or emotional harm toany person.

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## (f)            “Code” means the InternalRevenue Code of 1986, as amended.

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## (g)           “Common Stock” means thecommon stock of the Company.

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## (h)           “Company” means Crdentia Corp., a Delaware corporation.

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## (i)            “Consultant” means any person(other than an Employee or a Director, solely with respect to renderingservices in such person’s capacity as a Director) who is engaged by the Companyor any Related Entity to render consulting or advisory services to the Companyor such Related Entity.

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## (j)            “Continuous Service” meansthat the provision of services to the Company or a Related Entity in anycapacity of Employee, Director or Consultant, is not interrupted or terminated.In jurisdictionsrequiring notice in advance of an effective termination as an Employee,Director or Consultant, Continuous Service shall be deemed terminated upon theactual cessation of providing services to the Company or a Related Entitynotwithstanding any required notice period that must be fulfilled before atermination as an Employee, Director or Consultant can be effective underApplicable Laws. The Grantee’s Continuous Service shall be deemed tohave terminated either upon an actual termination of Continuous Service or uponthe entity for which the Grantee provides services ceasing to be a RelatedEntity. Continuous Service shall not be considered interrupted in the case of(i) any approved leave of absence, (ii) transfers among the Company,any Related Entity, or any successor, in any capacity of Employee, Director orConsultant, or (iii) any change in status as long as the individualremains in the service of the Company or a Related Entity in any capacity ofEmployee, Director or Consultant (except as otherwise provided in the AwardAgreement). An approved leave of absence shall include sick leave, militaryleave, or any other authorized personal leave.

 

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## (k)           “Corporate Transaction” meansany of the following transactions, provided, however, that the Board shalldetermine under parts (iv) and (v) whether multiple transactions are related,and its determination shall be final, binding and conclusive:

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### (i)            amerger or consolidation in which the Company is not the surviving entity, exceptfor a transaction the principal purpose of which is to change the state inwhich the Company is incorporated;

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### (ii)           thesale, transfer or other disposition of all or substantially all of the assetsof the Company (including the capital stock of the Company’s subsidiarycorporations);

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### (iii)          thecomplete liquidation or dissolution of the Company;

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### (iv)          anyreverse merger or series of related transactions culminating in a reversemerger (including, but not limited to, a tender offer followed by a reverse merger)in which the Company is the surviving entity but (A) the shares of CommonStock outstanding immediately prior to such merger are converted or exchangedby virtue of the merger into other property, whether in the form of securities,cash or otherwise, or (B) in which securities possessing more than fiftypercent (50%) of the total combined voting power of the Company’s outstandingsecurities are transferred to a person or persons different from those who heldsuch securities immediately prior to such merger or the initial transactionculminating in such merger, but excludingany such transaction or series of related transactions that the Boarddetermines shall not be a Corporate Transaction; or

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### (v)           acquisition in a single or series of relatedtransactions by any person or related group of persons (other than the Companyor by a Company-sponsored employee benefit plan) of beneficial ownership(within the meaning of Rule 13d-3 of the Exchange Act) of securities possessingmore than fifty percent (50%) of the total combined voting power of the Company’soutstanding securities but excluding any such transaction or series of relatedtransactions that the Board determines shall not be a Corporate Transaction.

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## (l)            “Director” means a member ofthe Board or the board of directors of any Related Entity.

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## (m)          “Disability” means as such termis expressly defined in a then-effective written agreement between the Granteeand the Company or such Related Entity, or in the absence of suchthen-effective written agreement and definition, as defined under the long-termdisability policy of the Company or the Related Entity to which the Granteeprovides services regardless of whether the Grantee is covered by such policy. Inthe absence of a written agreement containing a definition of disability and ifthe Company or the Related Entity to which the Grantee provides service doesnot have a long-term disability plan in place, “Disability” means that aGrantee is unable to carry out the responsibilities and functions of the positionheld by the Grantee by reason of any medically determinable physical or mentalimpairment for a period of not less than ninety (90) consecutive days. AGrantee will not be considered to have incurred a Disability unless he or shefurnishes proof of such impairment sufficient to satisfy the Board in itsdiscretion.

 

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## (n)           “Employee” means any person, including an Officer orDirector, who is in the employ of the Company or any Related Entity, subject tothe control and direction of the Company or any Related Entity as to both thework to be performed and the manner and method of performance. The payment of adirector’s fee by the Company or a Related Entity shall not be sufficient toconstitute “employment” by the Company.

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## (o)           “Exchange Act” means theSecurities Exchange Act of 1934, as amended.

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## (p)           “Fair Market Value” means, asof any date, the value of Common Stock determined as follows:

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### (i)            Ifthe Common Stock is listed on one or more established stock exchanges ornational market systems, including without limitation The Nasdaq NationalMarket or The Nasdaq SmallCap Market of The Nasdaq Stock Market, its FairMarket Value shall be the closing sales price for such stock (or the closingbid, if no sales were reported) as quoted on the principal exchange or systemon which the Common Stock is listed (as determined by the Board) on the date ofdetermination (or, if no closing sales price or closing bid was reported onthat date, as applicable, on the last trading date such closing sales price orclosing bid was reported), as reported in The Wall Street Journal or such othersource as the Board deems reliable;

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### (ii)           Ifthe Common Stock is regularly quoted on an automated quotation system(including the OTC Bulletin Board) or by a recognized securities dealer, its Fair Market Value shall be the closingsales price for such stock as quoted on such system or by such securitiesdealer on the date of determination, but if selling prices are notreported, the Fair Market Value of a share of Common Stock shall be the meanbetween the high bid and low asked prices for the Common Stock on the date ofdetermination (or, if no such prices were reported on that date, on the lastdate such prices were reported), as reported in The Wall Street Journal or suchother source as the Board deems reliable; or

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### (iii)          In the absence of an established market for theCommon Stock of the type described in (i) and (ii), above, the Fair MarketValue thereof shall be determined by the Board in good faith.

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## (q)           “Good Reason” means theoccurrence of any of the following events or conditions unless consented to bythe Grantee (and the Grantee shall be deemed to have consented to any suchevent or condition unless the Grantee provides written notice of the Grantee’snon-acquiescence within 30 days of the effective time of such event orcondition):

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### (i)            areduction in the Grantee’s base salary to a level below that in effect at anytime within the preceding six (6) months; or

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### (ii)           requiringthe Grantee to be based at any place outside a 45-mile radius from the Grantee’sjob location except for reasonably required travel on business.

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## (r)            “Officer” means a person whois an officer of the Company or a Related Entity within the meaning ofSection 16 of the Exchange Act and the rules and regulations promulgatedthereunder.

 

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## (s)           “Parent” means a “parentcorporation,” whether now or hereafter existing, as defined inSection 424(e) of the Code.

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## (t)            “Related Entity” means anyParent or Subsidiary of the Company and any business, corporation, partnership,limited liability company or other entity in which the Company or a Parent or aSubsidiary of the Company holds a substantial ownership interest, directly orindirectly.

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## (u)           “Replaced”means that pursuant to a Corporate Transaction the Award is replaced with a comparable stockaward or a cash incentive program of the Company, the successor entity (ifapplicable) or Parent of either of them which preserves the compensationelement of such Award existing at the time of the Corporate Transaction andprovides for subsequent payout in accordance with the same (or a morefavorable) vesting schedule applicable to such Award. The determination of Awardcomparability shall be made by the Board and its determination shall be final,binding and conclusive.

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## (v)           “Share” means a share of theCommon Stock.

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## (w)          “Subsidiary” means a “subsidiarycorporation,” whether now or hereafter existing, as defined inSection 424(f) of the Code.

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**END OFAGREEMENT**

 

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**EXHIBIT A**

 

**STOCK ASSIGNMENT SEPARATE FROM CERTIFICATE**

 

FORVALUE RECEIVED,                                       hereby sells, assigns and transfers unto                                       ,                                    (        ) shares of the CommonStock of Crdentia Corp., a Delaware corporation (the “Company”), standing inhis name on the books of, the Company represented by Certificate No.    herewith, and does hereby irrevocably constitute and appoint the Secretary ofthe Company attorney to transfer the said stock in the books of the Companywith full power of substitution.

 
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**[Pleasesign this document but do not date it. The date and information of thetransferee will be completed if and when the shares are assigned.]**

 

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