Exhibit 10.4


 


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).


 


	
  $2,500,000

  	
   

  	
  July      , 2008

  



 


AMENDED AND RESTATED TERM NOTE


(Tranche A)


 


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 Five Hundred
Thousand ($2,500,000) Dollars (the “Principal”),
with interest thereon, on the terms and conditions set forth herein and in the
Amended and Restated 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 monthly in arrears on the first day of each calendar
month commencing July 1, 2008, and upon the maturity hereof.


 


(b)                                 Principal.  The outstanding Principal of this Note shall
be payable (i) in seventeen (17) equal monthly installments of $104,166.67
each, due and payable on the first day of each calendar month commencing September 1,
2009 and continuing through and including January 1, 2011, and (ii) a
final installment due and payable on February 28, 2011, in an amount equal
to the entire remaining Principal balance of this Note.


 


(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 unpaid accrued Interest on the
Principal amount being prepaid, and then to Principal.  Any and all prepayments of Principal
hereunder shall be applied to the installments under Section 1(b) above
in the inverse order of their maturity.


 


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.


 


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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.


 


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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10.                                 Effect on Prior
Note.  This Note amends, restates and
supercedes in its entirety the Term Note (Tranche A) dated February 22,
2008 issued by the Maker to ComVest, provided that this Note does not effect a
novation of the outstanding obligations under such prior Term Note (all of
which obligations shall henceforth be evidenced by this Note).


 


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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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