Exhibit 10.1


 


THIS
SUBSCRIPTION AGREEMENT DOES NOT CONSTITUTE AN OFFER OR SOLICITATION BY ANYONE
IN ANY JURISDICTION IN WHICH SUCH AN OFFER OR SOLICITATION IS NOT AUTHORIZED


 


CRDENTIA
CORP.


SUBSCRIPTION
AGREEMENT


 


I.              Subscription.


 


A.            The
Undersigned (the “Purchaser”), pursuant to the terms and conditions of this
Subscription Agreement (the “Agreement”), hereby irrevocably subscribes for the
purchase of $200,000 of Common Stock (the “Stock”) issued by Crdentia
Corp. (the “Company”), at a price per share of $0.80. The shares of
Stock are sometimes referred to herein as the “Securities.”  The total aggregate purchase price to be paid
by the Purchaser for the Securities purchased hereunder will be the amount of $200,000
(the “Purchase Price”). The Purchaser hereby agrees to deliver to the Company
an executed copy of this Agreement and the Purchase Price.


 


B.            The
Purchaser agrees that this subscription shall be irrevocable and shall survive
the death or disability of the Purchaser.


 


C.            The
executed Agreement will be held for the benefit of the Purchaser until the
subscription is accepted by the Company pursuant to Section II below. If
the subscription is not accepted, the executed Agreement will be promptly
returned to the Purchaser.


 


D.            On the date
set forth on the signature page hereto the Purchaser shall wire to the
Company the payment representing the Purchase Price of the Securities acquired
by the Purchaser.


 


II.            Acceptance
of Subscription.


 


The Purchaser
acknowledges that the Company has the right to accept or reject this
subscription, in whole or in part, for any reason, and that this subscription
shall be deemed to be accepted by the Company only when an authorized
representative of the Company has executed and acknowledged this Agreement on
the Company’s behalf. The subscription either will be accepted or rejected, or
accepted in part and rejected in part, as promptly as practical after
receipt. The Purchaser agrees that subscriptions need not be accepted in the
order they are received by the Company. Upon rejection of this subscription for
any reason, all items received with this subscription shall be returned to the
Purchaser, and this Subscription Agreement shall be deemed to be null and void
and of no further force or effect. The Purchaser understands and agrees that
the acceptance of this subscription by the Company, or a part of this
subscription, will in no way constitute a determination by the Company that an
investment in the Securities is a suitable investment for the Purchaser.


 

















 


III.           Representations,
Warranties and Covenants of the Company.


 


A.            In
connection with the execution of this Agreement by the Purchaser, the Company
hereby agrees to the following representations, warranties and covenants and
the Purchaser is entitled to rely on such representations, warranties and
covenants in making any purchase that it may make of the Stock pursuant to
this Agreement.


 


1.1           Organization.
The Company is duly organized and validly existing in good standing under the
laws of the State of Delaware. Each of the Company and its Subsidiaries (as
defined in Rule 405 under the Securities Act) has full power and authority
to own, operate and occupy its properties and to conduct its business as
presently conducted and as described in the Exchange Act Documents and is
registered or qualified to do business and in good standing in each
jurisdiction in which the nature of the business conducted by it or the
location of the properties owned or leased by it requires such qualification
and where the failure to be so qualified would have a material adverse effect
upon the condition (financial or otherwise), earnings, business or business
prospects, properties or operations of the Company and its Subsidiaries,
considered as one enterprise (a “Material Adverse Effect”).


 


1.2           Due
Authorization and Valid Issuance. The Company has all requisite power and
authority to execute, deliver and perform its obligations under this
Agreement, and this Agreement has been duly authorized. This Agreement has been
validly executed and delivered by the Company and constitutes a legal, valid
and binding agreement of the Company enforceable against the Company in
accordance with its terms, except as (A) rights to indemnity and
contribution may be limited by court decision or applicable law, (B) enforceability
may be limited by applicable bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting creditors’ and contracting parties’ rights
generally and (C) enforceability may be subject to general principles
of equity (regardless of whether such enforceability is considered in a
proceeding in equity or at law) or the discretion of the court before which any
proceeding is brought. The Stock being purchased hereunder will, upon issuance
and payment therefor pursuant to the terms hereof, be duly authorized and
validly issued, and the Stock will, upon issuance pursuant to the terms hereof,
be fully paid and nonassessable.


 


1.3           Non-Contravention.
Assuming the correctness of the representations and warranties of the
Purchaser, no consent, approval, authorization or other order of, or
registration, qualification or filing with, any regulatory body, administrative
agency, or other governmental body in the United States or any other person is
required for the execution and delivery of this Agreement and the valid
issuance and sale of the Securities to be sold and issued pursuant to this
Agreement, other than such as have been made or obtained, and except for any
post-closing securities filings or notifications required to be made under
federal or state securities laws and applicable rules of the National
Association of Securities Dealers, Inc.


 


1.4           Transfer
Taxes. All stock transfer or other taxes (other than income taxes) which
are required to be paid in connection with the sale and transfer of the Securities
to be sold to the Purchaser hereunder will be, or will have been, fully paid or
provided for by the Company and all laws imposing such taxes will be or will
have been fully complied with.


 


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1.5           Private Offering.
Assuming the correctness of the representations and warranties of the Purchasers
set forth in this Agreement, the offer and sale of Securities hereunder is
exempt from registration under the Securities Act. The Company has not in the past
nor will it hereafter take any action to sell, offer for sale or solicit offers
to buy any securities of the Company which would bring the offer, issuance or
sale of the Securities as contemplated by this Agreement, within the provisions
of Section 5 of the Securities Act, unless such offer, issuance or sale
was or shall be within the exemptions of Section 4 of the Securities Act.


 


The foregoing representations and warranties are true,
complete and accurate as of the date hereof, shall be true, complete and
accurate as of the date of delivery, if any, of the Securities to the Purchaser
and shall survive for a period of one year after the delivery, if any, of the Securities.
The Company undertakes no duty to update the foregoing representations and
warranties.


 


IV.           Representations,
Warranties and Covenants of Purchaser.


 


The Purchaser
hereby represents and warrants to and covenants with the Company for the
Company’s benefit with knowledge that the Company is relying thereon in
entering into this Agreement and issuing the Securities to such Purchaser, as
follows:


 


A.            The
Purchaser has reviewed the documents filed by the Company under the Securities
Exchange Act of 1934, as amended (the “Exchange Act”), since the end of its
most recently completed fiscal year through the date hereof, including, without
limitation, its most recent reports on Form 10-KSB, Form 10-QSB and Form 8-K
(together with all exhibits thereto). The Purchaser has been given the
opportunity to ask questions of and to receive answers from the Company
concerning the terms and conditions of the offer and sale of the Securities,
and to obtain such additional written information necessary to verify the
accuracy of same as the Purchaser desires in order to evaluate an investment in
the securities described herein.


 


B.            The
Purchaser is an accredited investor as that term is defined in Rule 501(a) of
Regulation D under the U.S. Securities Act of 1933, as amended (the “Securities
Act”), which definition is annexed hereto as “Exhibit A.”


 


C.            Immediately
prior to the Purchaser’s execution of this Agreement, the Purchaser had such
knowledge and experience in financial and business matters (including
experience with investments of a similar nature), that the Purchaser was
capable of evaluating the merits and risks of an investment in the Securities.


 


D.            The
Securities are being acquired solely for the Purchaser’s own account for
investment purposes only and not with a view to or for any resale or
distribution thereof or with any present intention of distributing or selling
all or any part of such Securities. The Purchaser agrees that the
Securities may not be transferred except upon registration under the
Securities Act, and under any applicable state securities or “blue sky” laws,
or upon receipt by the Company of evidence in form and substance
reasonably satisfactory to the Company, to the effect that such transfer may be
made without registration under the Act and applicable state securities or “blue
sky” laws.


 


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E.             The
Purchaser recognizes that the purchase of the Securities is a speculative
investment that involves a high degree of risk and is suitable only for persons
with the financial capability of making and holding long-term investments not
readily reducible to cash. The Purchaser is aware that there is no guarantee
that the Purchaser will realize any gain from an investment in the Securities. The
Purchaser further understands that the Purchaser could lose the entire amount
of the Purchaser’s investment.


 


F.             The
Purchaser understands that no U.S. federal or state securities commission or
regulatory authority, or other authority (within or outside of the United
States) has made any finding or determination regarding the fairness of the
offer, sale and/or issuance of the Securities, has made any recommendation or
endorsement of the offer and sale of the Securities or has passed in any way
upon this Agreement.


 


G.            The
Purchaser is financially able to bear the economic risk of an investment in the
Securities, including the ability to hold such Securities indefinitely and to
afford a complete loss of his investment in the Securities.


 


H.            The
certificates and/or other documentation evidencing the Securities will contain
a legend substantially as follows:


 


THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) OR THE SECURITIES,
BLUE SKY OR OTHER APPLICABLE LAWS OF ANY STATE, OR ANY OTHER RELEVANT
JURISDICTION, AND MAY NOT BE OFFERED AND SOLD UNLESS (A) REGISTERED
AND/OR QUALIFIED PURSUANT TO THE RELEVANT PROVISIONS OF U.S. FEDERAL SECURITIES
LAWS, THE SECURITIES, BLUE SKY, OR OTHER APPLICABLE LAWS OF ANY STATE, OR OTHER
RELEVANT JURISDICTION OR (B) EXEMPT FROM SUCH REGISTRATION OR
QUALIFICATION. THEREFORE, NO SALE, PLEDGE OR OTHER TRANSFER OF THIS SECURITY
SHALL BE MADE, NO ATTEMPTED SALE, PLEDGE OR OTHER TRANSFER SHALL BE VALID, AND
THE ISSUER SHALL NOT BE REQUIRED TO GIVE ANY EFFECT TO ANY SUCH TRANSACTION
UNLESS (A) SUCH TRANSACTION SHALL HAVE BEEN DULY REGISTERED UNDER THE
SECURITIES ACT AND QUALIFIED OR APPROVED UNDER THE SECURITIES, BLUE SKY, OR
OTHER APPLICABLE LAWS OF ANY STATE, OR OTHER RELEVANT JURISDICTION, OR (B) THE
COMPANY SHALL HAVE BEEN SATISFIED THAT SUCH REGISTRATION, QUALIFICATION OR
APPROVAL IS NOT REQUIRED.


 


The Purchaser further acknowledges that: (i) any
necessary stop transfer orders will be placed upon the certificates for the
Securities in accordance with the Securities Act, and (ii) the Company is
under no obligation to aid the Purchaser in obtaining an exemption from the
registration requirements of the Securities Act or any jurisdiction.


 


I.              Purchaser
understands that the Securities are being offered and sold to it in reliance on
specific exemptions from the registration and approval requirements of the U.S.
federal and state securities laws or the laws of other applicable jurisdictions
and that the Company is relying upon the truth, completeness and accuracy of
the representations,


 


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warranties, agreements, acknowledgments and
understandings of Purchaser set forth herein in order to determine the
applicability of such exemptions and the suitability of Purchaser to acquire
the Securities.


 


J.             The
execution, delivery and performance by the Purchaser of this Subscription
Agreement are within the powers of the Purchaser, have been duly authorized and
will not constitute or result in a breach or default under, or conflict with,
any order, ruling or regulation of any court or other tribunal or of any
governmental commission or agency, or any agreement or other undertaking, to
which the Purchaser is a party or by which the Purchaser is bound; and, if the
Purchaser is not an individual, will not violate any provision of the charter
documents, bylaws, indenture of trust, partnership agreement or similar
documents, as applicable, of the Purchaser. The signatures on this Subscription
Agreement are genuine; and the signatory, if the Purchaser is an individual,
has legal competence and capacity to execute the same, or, if the Purchaser is
not an individual, the signatory has been duly authorized to execute the same;
and this Subscription Agreement constitutes the legal, valid and binding
obligation of the Purchaser, enforceable in accordance with its terms.


 


K.            The type
of ownership in which the Purchaser is applying to purchase Securities is as
follows:  (Check One)


 


o                                    INDIVIDUAL
OWNERSHIP (One signature required)


 


o                                    JOINT
TENANTS WITH RIGHT OF SURVIVORSHIP (Both parties must sign)


 


o                                    TRUST
(Please include name of trustee, date trust was formed and a copy of the Trust
Agreement or other authorization)


 


o                                    CORPORATION
(Please include Certified Corporate Resolution authorizing signature)


 


ý                                    PARTNERSHIP
(Signature of the authorized general partner is required)


 


o                                    COMMUNITY
PROPERTY (Two signatures required)


 


o                                    TENANTS-IN-COMMON
(Both parties must sign)


 


o                                    OTHER
(Describe)


 


The foregoing representations and warranties are true,
complete and accurate as of the date hereof, shall be true, complete and
accurate as of the date of delivery of this Subscription Agreement and
accompanying documents to the Company and shall survive the delivery of the
Securities. If, in any respect, those representations and warranties shall not
be true, complete and accurate prior to acceptance or rejection of this
subscription by the Company pursuant to Section II, the undersigned shall
immediately give written notice to the Company specifying which representations
and warranties are not true, complete and accurate and the reason therefor. The
Purchaser agrees that the foregoing representations and warranties may be
used as a defense in any actions relating to the Company or the offering of


 


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the Securities, and that it is only on the basis of
such representations and warranties that the Company may be willing to
accept the Purchaser’s subscription for the Securities.


 


V.            Waiver.


 


Except
as otherwise specifically provided for hereunder, no party shall be deemed to
have waived any of his, her or its rights hereunder unless such waiver is in
writing and signed by the party waiving said right. Except as otherwise
specifically provided for hereunder, no delay or omission by any party in
exercising any right with respect to the subject matter hereof shall operate as
a waiver of such right or of any such other right. A waiver on any one occasion
with respect to the subject matter hereof shall not be construed as a bar to or
waiver of any right or remedy on any future occasion. All rights and remedies
with respect to the subject matter hereof shall be cumulative and may be
exercised separately or concurrently.


 


VI.           Severability.


 


If any
term, covenant or condition of this Agreement is held to be invalid, void or
otherwise unenforceable by any court of competent jurisdiction, the remainder
of this Agreement shall not be affected thereby and each term, covenant and
condition of this Agreement shall be valid and enforceable to the fullest
extent permitted by law.


 


VII.          Entire
Agreement.


 


Neither the Company nor the Purchaser has made any
representations or warranties with respect to the subject matter hereof not set
forth herein. This Subscription Agreement and the documents and exhibits
referred to herein constitute the entire agreement between the parties hereto
with respect to the subject matter hereof. All understandings and agreements
which heretofore may have existed or did exist between the parties hereto
with respect to the subject matter hereof are superseded by this Subscription
Agreement.


 


VIII.        Assignability.


 


This Subscription Agreement is not transferable or
assignable by the undersigned or any successor thereto. Any attempted
assignment will be void.


 


IX.           Attorney’s
Fees.


 


If any
action of law or in equity is necessary to enforce or interpret the terms of
this Agreement, the prevailing party shall be entitled to an award of its
reasonable attorneys’ fees, costs and disbursements in addition to any other
relief to which such party may be entitled.


 


X.            Amendment;
Termination.


 


This Subscription Agreement may not be changed,
modified, extended or terminated other than by an agreement in writing, signed
by the Company and the Purchaser.


 


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XI.           Survival.


 


The representations and warranties made herein shall
survive the consummation of the transaction contemplated hereby.


 


XII.         Counterparts.


 


This
Agreement may be executed in one or more counterparts, each of which shall
be deemed an original, but all of which together shall constitute one and the
same instrument.


 


XIII.        Governing
Law.


 


This Subscription Agreement shall be governed by, and
construed and enforced in accordance with, the laws of the State of Delaware,
without regard to principles of conflicts of laws.


 


XIV.        Confidentiality;
Certain Disclosures.


 


The Company may present this Subscription
Agreement to such parties as its deems advisable if compelled by law or called
upon to establish the availability under any U.S. federal or state securities
laws of an exemption from registration of the Securities or if the contents
thereof are relevant to any issue in any action, suit, or proceeding to which
the Company is a party or by which it is or may be bound.


 


[REMAINDER OF PAGE INTENTIONALLY
LEFT BLANK]


 


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Purchaser hereby agrees to pay an aggregate of $200,000
as consideration for the Stock.


 


	
  “Purchaser:”

  	
  MedCap Partners L.P.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  MedCap
  Management & Research LLC

  
	
   

  	
  Its:

  	
  General Partner

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ C. Fred Toney

  	
   

  
	
   

  	
  Name:

  	
  C. Fred Toney

  
	
   

  	
  Its:

  	
  Managing Member

  
	
   

  	
   

  
	
   

  	
  Address:

  	
  500 Third
  Street, Suite 535

  
	
   

  	
   

  	
  San Francisco,
  CA 94107

  
	
   

  	
  Telephone:

  	
  (415) 495-1010

  
	
   

  	
  Facsimile:

  	
  (415) 495-1012

  
	
   

  	
  Date:

  	
  March 3,
  2006

  
	
   

  	
   

  
	
   

  	
   

  
	
  Please register the
  Securities as follows:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Deliver to (if other
  than the address above):

  
	
   

  	
   

  
	
   

  	
   

  
						



 


 


	
  SUBSCRIPTION
  ACCEPTED AS OF

  
	
  THE THIRD DAY OF
  MARCH, 2006.

  
	
   

  
	
  Crdentia
  Corp.,

  
	
  a
  Delaware corporation

  
	
   

  
	
  By:

  	
    /s/ James J. TerBeest

  	
   

  
	
  Name:

  	
  James J.
  TerBeest

  
	
  Title:

  	
  Chief Financial
  Officer

  
				



 


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EXHIBIT “A”


DEFINITION OF ACCREDITED INVESTOR


 


Accredited Investor. “Accredited
investor” shall mean any person who comes within any of the following
categories, or who the issuer reasonably believes comes within any of the
following categories, at the time of the sale of the securities to that person:


 


(1)           Any bank
as defined in section 3(a)(2) of the Securities Act, or any savings
and loan association or other institution as defined in section 3(a)(5)(A) of
the Securities Act whether acting in its individual or fiduciary capacity; any
broker or dealer registered pursuant to section 15 of the Securities
Exchange Act of 1934; any insurance company as defined in section 2(13) of
the Securities Act; any investment company registered under the Investment Company
Act of 1940 or a business development company as defined in section 2(a)(48)
of that Act; Small Business Investment Company licensed by the U.S. Small
Business Administration under section 301(c) or (d) of the Small
Business Investment Act of 1958; any plan established and maintained by a
state, its political subdivisions, or any agency or instrumentality of a state
or its political subdivisions, for the benefit of its employees, if such plan
has total assets in excess of $5,000,000; employee benefit plan within the
meaning of the Employee Retirement Income Security Act of 1974 if the
investment decision is made by a plan fiduciary, as defined in section 3(21)
of such Act, which is either a bank, savings and loan association, insurance
company, or registered investment adviser, or if the employee benefit plan has
total assets in excess of $5,000,000 or, if a self-directed plan, with
investment decisions made solely by persons that are accredited investors;


 


(2)           Any
private business development company as defined in section 202(a)(22) of
the Investment Advisers Act of 1940;


 


(3)           Any
organization described in Section 501(c)(3) of the Internal Revenue
Code, corporation, Massachusetts or similar business trust, or partnership, not
formed for the specific purpose of acquiring the securities offered, with total
assets in excess of $5,000,000;


 


(4)           Any
director, executive officer, or general partner of the issuer of the securities
being offered or sold, or any director, executive officer, or general partner
of a general partner of that issuer;


 


(5)           Any
natural person whose individual net worth, or joint net worth with that person’s
spouse, at the time of his purchase exceeds $1,000,000;


 


(6)           Any
natural person who had an individual income in excess of $200,000 in each of
the two most recent years or joint income with that person’s spouse in excess
of $300,000 in each of those years and has a reasonable expectation of reaching
the same income level in the current year;


 


(7)           Any trust,
with total assets in excess of $5,000,000, not formed for the specific purpose
of acquiring the securities offered, whose purchase is directed by a
sophisticated person as described in §230.506(b)(2)(ii); and


 


(8)           Any entity
in which all of the equity owners are accredited investors.


 


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