Exhibit 10.6


 


THIS NOTE, THE MAKER’S OBLIGATIONS HEREUNDER, AND
THE PAYEE’S RIGHTS HEREUNDER, ARE SUBORDINATE TO CERTAIN SENIOR INDEBTEDNESS OF
THE MAKER, AS, IN THE MANNER AND TO THE EXTENT PROVIDED IN THOSE CERTAIN
SUBORDINATION AGREEMENTS OF EVEN DATE HEREWITH BY AND AMONG THE PAYEE AND
CAPITAL TEMPFUNDS (AS SAME MAY BE AMENDED, MODIFIED, SUPPLEMENTED AND/OR
RESTATED FROM TIME TO TIME).


 


	
  $2,400,000

  	
  July     , 2008

  



 


TERM NOTE


(Tranche C)


 


FOR VALUE RECEIVED, the
undersigned, CRDENTIA CORP., a Delaware corporation (the “Maker”), hereby promises to pay to ComVest
Capital, LLC, a Delaware limited liability company (“ComVest),
or registered assigns (hereinafter, collectively with ComVest, the “Payee”), the sum of Two Million Four
Hundred Thousand ($2,400,000) Dollars (the “Principal”),
with interest thereon, on the terms and conditions set forth herein and in the
Revolving Credit and Term Loan Agreement of even date herewith by and between
the Maker and ComVest (the “Loan Agreement”).  Terms
defined in the Loan Agreement and not otherwise defined herein shall have the
meanings assigned thereto in the Loan Agreement.


 


Payments of principal of,
interest on and any other amounts with respect to this Term Note (this “Note”) are to be made in lawful money of
the United States of America.


 


1.                                       Payments.


 


(a)                                  Interest.  This Note shall bear interest (“Interest”) on Principal amounts outstanding from time to
time from the date hereof at the rate of twelve and one-half (12.5%) percent
per annum; provided, however, that during the continuance of any
Event of Default under the Loan Agreement, the interest rate hereunder shall be
seventeen and one-half (17.5%) percent per annum.  All Interest shall be computed on the daily
unpaid Principal balance of this Note based on a three hundred sixty (360) day
year, and shall be payable upon the maturity or required prepayment in full of
this Note.


 


(b)                                 Principal.  The outstanding Principal of this Note shall
be due and payable in full on February 28, 2011.


 


(c)                                  Non-Business
Day.  If any scheduled payment date
as aforesaid is not a business day in the State of Texas or the State of
Florida, then the payment to be made on such scheduled payment date shall be
due and payable on the next succeeding business day, with additional interest on
any Principal amount so delayed for the period of such delay.


 


2.                                       Prepayment.


 


(a)                                  Optional
Prepayment of Principal.  All
or any portion of the unpaid Principal balance of this Note, together with all
accrued and unpaid Interest on the Principal 


 

















 


amount being prepaid, may at the Maker’s option be prepaid in whole or
in part, at any time or from time to time, without premium or penalty, upon ten
(10) days’ prior written notice to the Payee.


 


(b)                                 Mandatory
Prepayments of Principal.  The
entire Principal balance of this Note, and all accrued and unpaid Interest
hereunder, (i) shall be required to be prepaid upon the consummation of
any Sale, and (ii) may be required to be prepaid upon the occurrence of
any Event of Default.  In addition, all
or a portion of the Principal of this Note shall be required to be prepaid as
and to the extent provided in Section 2.02(b) of the Loan Agreement.


 


(c)                                  Application of
Payments.  Any and all
prepayments hereunder shall be applied first [to any prepayment premium
required under Section 2(a) above, then] to unpaid accrued Interest
on the Principal amount being prepaid, and then to Principal.


 


3.                                       Events of
Default.  The occurrence or existence of
an Event of Default under the Loan Agreement shall constitute a default under
this Note and shall entitle the Payee to accelerate the entire indebtedness
hereunder and take such other action as may be provided for in the Loan
Agreement and/or in any and all other instruments evidencing and/or securing
the indebtedness under this Note, or as may be provided under the law.


 


4.                                       Assignment.  This Note shall be binding upon and shall
inure to the benefit of the respective successors and permitted assigns of the
parties hereto, provided that the Maker may not assign any of its rights or
obligations hereunder without the prior written consent of the Payee.


 


5.                                       Waiver and
Amendment.  No waiver
of a right in any instance shall constitute a continuing waiver of successive
rights, and any one waiver shall govern only the particular matters waived.  Neither any provision of this Note nor any
performance hereunder may be amended or waived except pursuant to an agreement
in writing signed by the party against whom enforcement thereof is sought.  Except as otherwise expressly provided in
this Note, the Maker hereby waives diligence, demand, presentment for payment,
protest, dishonor, nonpayment, default, notice of any and all of the foregoing,
and any other notice or action otherwise required to be given or taken under
the law in connection with the delivery, acceptance, performance, default,
enforcement or collection of this Note, and expressly agrees that this Note, or
any payment hereunder, may be extended, modified or subordinated (by
forbearance or otherwise) from time to time, without in any way affecting the
liability of the Maker.  The Maker
further waives the benefit of any exemption under the homestead exemption laws,
if any, or any other exemption, appraisal or insolvency laws, and consents that
the Payee may release or surrender, exchange or substitute any personal
property or other collateral security now held or which may hereafter be held
as security for the payment of this Note.


 


6.                                       Governing Law.  This Note shall be construed in accordance
with and governed by  the laws of
the State of New York, except to the extent superseded by Federal enactments.


 


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7.                                       Consent to
Jurisdiction; Waiver of Jury Trial.  The Maker hereby consents to the jurisdiction
of all courts of the State of New York and the United States District Court for
the Southern District of New York, as well as to the jurisdiction of all courts
from which an appeal may be taken from such courts, for the purpose of any
suit, action or other proceeding arising out of or with respect to this
Note.  The Maker hereby waives the right
to interpose any counterclaims (other than compulsory counterclaims) in any
action brought by the Payee hereunder, provided that this waiver shall not
preclude the Maker from pursuing any such claims by means of separate
proceedings.  THE MAKER HEREBY EXPRESSLY
WAIVES ANY AND ALL OBJECTIONS WHICH IT MAY HAVE AS TO VENUE IN ANY OF SUCH
COURTS, AND ALSO WAIVES ALL RIGHTS TO TRIAL BY JURY IN ANY SUCH SUIT, ACTION OR
PROCEEDING.  The Payee may file a copy of
this Note as evidence of the foregoing waiver of right to jury trial.


 


8.                                       Usury Savings
Clause.  All agreements between the
Maker and the Payee are hereby expressly limited to provide that in no
contingency or event whatsoever, whether by reason of acceleration of maturity
of the indebtedness evidenced hereby or otherwise, shall the amount paid or
agreed to be paid to the Payee for the use, forbearance or detention of the
indebtedness evidenced hereby exceed the maximum amount which the Payee is
permitted to receive under applicable law. 
If, from any circumstances whatsoever, fulfillment of any provision
hereof or of the Loan Agreement or any Loan Document thereunder, at the time
performance of such provision shall be due, shall involve transcending the
limit of validity prescribed by law, then, ipso facto, the obligation to be
fulfilled shall automatically be reduced to the limit of such validity, and if
from any circumstance the Payee shall ever receive as interest an amount which
would exceed the highest lawful rate, such amount which would be excessive
interest shall be applied to the reduction of the principal balance of any of
the Maker’s Obligations (as such term is defined in the Loan Agreement) to the
Payee, and not to the payment of interest hereunder.  To the extent permitted by applicable law, all
sums paid or agreed to be paid for the use, forbearance or detention of the
indebtedness evidenced by this Note shall be amortized, prorated, allocated and
spread throughout the full term of such indebtedness until payment in full, to
the end that the rate or amount of interest on account of such indebtedness
does not exceed any applicable usury ceiling. 
As used herein, the term “applicable law” shall mean the law in effect
as of the date hereof, provided, however, that in the event there is a change
in the law which results in a higher permissible rate of interest, then this
Note shall be governed by such new law as of its effective date.  This provision shall control every other
provision of all agreements between the Maker and the Payee.


 


9.                                       Collection
Costs.  In the event that the Payee
shall place this Note in the hands of an attorney for collection during the
continuance of any Event of Default, the Maker shall further be liable to the
Payee for all costs and expenses (including reasonable attorneys’ fees) which
may be incurred by the Payee in enforcing this Note, all of which costs and
expenses shall be obligations under and part of this Note; and the Payee may
take judgment for all such amounts in addition to all other sums due hereunder.


 


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IN WITNESS WHEREOF, the
Maker has executed this Note on the date first above written.


 


	
   

  	
  CRDENTIA CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  John B. Kaiser

  
	
   

  	
   

  	
  Name:
  John B. Kaiser

  
	
   

  	
   

  	
  Title:
  Chief Executive Officer

  



 


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