AMENDMENT NO. 2 TO SECURITIES
PURCHASE AGREEMENT, SENIOR
SECURED CONVERTIBLE NOTES, WARRANTS
AND SECURITY AGREEMENT
This AMENDMENT NO. 2 TO SECURITIES PURCHASE
AGREEMENT, SENIOR SECURED CONVERTIBLE NOTES, WARRANTS AND SECURITY
AGREEMENT (this “Amendment”) is made and entered into
as of September 19, 2008, by and among Biophan Technologies, Inc.,
a Nevada corporation (the “Biophan”), and Castlerigg
Master Investments Ltd (the “Purchaser”) and the
other parties to the Securities Purchase Agreement, dated as of
October 11, 2006 (the “Purchase Agreement”), pursuant
to which Biophan issued and sold to the an aggregate of $7,250,000
of Notes and certain Warrants.
RECITALS
Capitalized
terms used and not defined in this Amendment shall have the
respective meanings set forth in the Purchase Agreement or in the
Forbearance Agreement, dated as of February 16, 2007 with the
holders of the Notes (the “Forbearance
Agreement”).
In connection
with the Purchase Agreement, Biophan and the Purchasers entered
into a Security Agreement, dated as of October 11, 2006 (the
“Security Agreement”), pursuant to which Biophan agreed
to pledge and grant a security interest in the Collateral (as
defined in the Security Agreement).
On October 11,
2007, Biophan and the Purchasers entered into an AMENDMENT NO. 1 to
SECURITIES PURCHASE AGREEMENT, SENIOR SECURED CONVERTIBLE NOTES,
WARRANTS AND SECURITY AGREEMENT (“Amendment No.
1”).
Whereas,
Biophan and the Purchasers have agreed that it is their mutual best
interests for Biophan to repay the Notes and, to accomplish the
same, now wish to further modify certain of the terms of the
Purchase Agreement, Notes, Warrants and the Security
Agreement.
NOW, THEREFORE, in
consideration of the foregoing Recitals and other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, Biophan and each Purchaser, severally and not
jointly, agree as follows:
1. Amendments to Purchase Agreement and the
Notes.
(a)
Purchaser may elect, by written
notice to such effect delivered to Biophan no later than September
19, 2008 (the “Repayment Election Notice”), to accept,
in repayment of its Note in full and satisfaction and cancellation
of all of Biophan’s obligations under the Transaction
Documents (other than the Warrants and the Fee Warrants (as defined
in the Forbearance Agreement) if Purchaser elects to retain the
same as hereinafter provided, or including the Warrants and the Fee
Warrants if the same are surrendered as hereinafter provided),
either (i) to surrender its Warrants and Fee Warrants to Biophan
for cancellation, and in consideration receive the “Cash
Payment”, the “Repayment Shares” and the
“Premium Shares” allocated to Purchaser under the
columns on the attached table that are designated as “Option
A - Premium Shares and Cancellation of Warrants”, or (ii) to
retain its Warrants and Fee Warrants on their current terms without
any modification, amendment or other adjustment solely by reason of
this Amendment, and receive the “Cash Payment” and the
“Repayment Shares” allocated to Purchaser under the
columns on the attached table that are designated as “Option
B - Warrants Remain in Place”.
(b)
If Purchaser executes and deliveres
this Amendment, but fails to deliver timely to Biophan a Repayment
Election Notice, Purchaser shall be deemed to have given Biophan
notice of its election to receive the consideration set forth in
(a)(i) above, and to surrender to Biophan on or before September
25, 2008 its Warrants for cancelation.
2. Continued Validity of Transaction
Documents under Purchase Agreements . The parties hereto agree
that (x) this Amendment shall be effective only if executed and
delivered by all of the Purchasers, and (y) the Purchase Agreement
and the Transaction Documents entered into in connection therewith
(as amended by this Amendment), and the Forbearance Agreement,
remain in full force and effect, modified to the extent and only to
the extent necessary to give effect to this Amendment and the
transactions herein contemplated.
3. Entire Agreement . This Amendment and
the Transaction Documents and the Forbearance Agreement, together
with the exhibits and schedules thereto, contain the entire
understanding of the parties with respect to the subject matter
hereof and supersede all prior agreements and understandings, oral
or written, with respect to such matters, which the parties
acknowledge have been merged into such documents, exhibits and
schedules.
4. Equal Treatment of Purchasers . No
consideration shall be offered or paid to any person to amend or
consent to a waiver or modification of any provision of any of the
Transaction Documents (or the Forbearance Agreemen
