BIOPHAN TECHS INC(OTC BB: BIPH.OB) Last Trade: 0.0181 Trade Time: 1:55PM ET Change: 0.0084 (31.70%) Prev Close: 0.0265 Open: 0.02 Bid: 0.018 x 10000 Ask: 0.019 x 10000 1y Target Est: N/A Day's Range: 0.0155 - 0.023 52wk Range: 0.01 - 0.25 Volume: 7,347,589 Avg Vol (3m): 2,221,210 Market Cap: 3.15M P/E (ttm): N/A EPS (ttm): -0.072 Div
UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): September 22, 2008
BIOPHAN TECHNOLOGIES, INC. (Exact name of registrant as specified in its charter)
Nevada 000-26057 82-0507874 (State or Other Jurisdiction of Incorporation or Organization) (Commission File Number) (IRS Employer Identification No.)
15 Schoen Place, Pittsford, New York 14534 (Address of principal executive offices) (Zip Code)
Copies to: Gregory Sichenzia, Esq. Andrew M. Smith, Esq. Sichenzia Ross Friedman Ference LLP 61 Broadway, 32nd Floor New York, New York 10006 Phone: (212) 930-9700 Fax: (212) 930-9725
N/A (Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 1.01 Entry Into a Material Definitive Agreement. Item 8.01 Other Events.
On September 24, 2008, Biophan Technologies, Inc. (the “Company”) announced execution of a prepayment agreement with the holders of its senior debt. A copy of the agreement is filed herewith as Exhibit 10.1 to, and is incorporated by reference in, this report. A separate agreement, on the same terms, was executed between the Company and Castlerigg Master Investments Ltd. (“Castlerigg”), a copy of which is filed herewith as Exhibit 10.02 to, and is incorporated by reference in, this report.
The prepayment agreement eliminated the remaining $2.3 million in senior debt (that would have been paid by issuances of common shares and cancelled warrants held by the holders of the senior debt to purchase another 17 million common shares, in exchange for an aggregate cash payment by the Company to the holders of the senior debt (including Castlerigg) of $2.15 million plus delivery of 18 million shares.
In addition to repaying its senior debt, the Company also announced the entry into an agreement with Biomed Solutions, LLC (“Biomed”), on September 23, 2008, restructuring of the Company’s subordinated note with Biomed. The restructuring extends the terms of the note with Biomed until December 31, 2012, in exchange for monthly cash payments beginning upon repayment of the senior debt. A copy of the agreement with Biomed is filed herewith as Exhibit 10.3 to, and is incorporated by reference in, this report.
On September 24, 2008, the Company issued a press release to announce the execution of the prepayment agreement with the holders of its senior debt that is discussed above. A copy of the press release that discusses this matter is filed as Exhibit 99.1 to, and incorporated by reference in, this report.
Item 9.01 Exhibits.
(d) Exhibits.
Exhibit Number Description
10.1 Prepayment Agreement, dated September 22, 2008, with holders of Company’s senior debt. 10.2 Prepayment Agreement, dated September 22, 2008, with Castlerigg. 10.3 Restructuring Agreement, entered into on September 23, 2008 with Biomed, extending maturity date of subordinated note. 99.1 Press Release, dated September 24, 2008, issued by Biophan Technologies, Inc.
Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
BIOPHAN TECHNOLOGIES, INC.
Dated: September 23, 2008 By: /s/ John Lanzafame
-------------------------------------------------------------------------------- Name: John Lanzafame Title: Chief Executive Officer
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 the purchasers identified on the signature pages hereto (each, a “Purchaser” and, collectively, the “Purchasers”).
RECITALS
Biophan and the Purchasers are parties to a Securities Purchase Agreement, dated as of October 11, 2006 (the “Purchase Agreement”), pursuant to which Biophan issued and sold to the Purchasers an aggregate of $7,250,000 of Notes and certain Warrants (each as defined in the Purchase Agreement). 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) Each 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 the 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 such 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 such Purchaser under the columns on the attached table that are designated as “Option B - Warrants Remain in Place”.
(b) Any Purchaser who has executed and delivered this Amendment, who fails to deliver timely to Biophan a Repayment Election Notice, 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 Agreement) unless the same consideration is also offered to all of the parties to the Transaction Documents (and the Forbearance Agreement). For clarification purposes, this provision constitutes a separate right granted to each Purchaser by Biophan and negotiated separately by each Purchaser, and is intended to treat Biophan and the Purchasers as a class and shall not in any way be construed as the Purchasers acting in concert or as a group with respect to the purchase, disposition or voting of Securities or otherwise.
5. Public Announcement. Biophan shall, by 8:30 a.m. Eastern time on September 24, 2008, issue a press release disclosing the material terms of the transactions contemplated hereby and timely file a Current Report on Form 8-K (the “8-K Filing”), attaching such press release and this Amendment. From and after the filing of the 8-K Filing with the Commission, the Company represents that the Purchasers shall not be in possession of any material, nonpublic information received from the Company, any of its Subsidiaries or any of its respective officers, directors, employees or agents that is not disclosed in the 8-K Filing. Biophan shall not, and shall cause each of its Subsidiaries and its and each of their respective officers, directors, employees and agents, not to, provide any Purchaser with any material, nonpublic information regarding the Company or any of its Subsidiaries from and after the filing of the 8-K Filing with the Commission without the express written consent of such Purchaser.
6. Notices. Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall be in writing and shall be deemed given and effective as specified in the Purchase Agreement. The address for such notices and communications shall be as set forth on the signature pages attached to the Purchase Agreement.
7. Miscellaneous.
7.1. Amendments; Waivers. No provision of this Amendment may be waived or amended except in a written instrument signed, in the case of an amendment, by Biophan and each Purchaser or, in the case of a waiver, by the party against whom enforcement of any such waiver is sought. No waiver of any default with respect to any provision, condition or requirement of this Amendment shall be deemed to be a continuing waiver in the future or a waiver of any subsequent default or a waiver of any other provision, condition or requirement hereof, nor shall any delay or omission of either party to exercise any right hereunder in any manner impair the exercise of any such right.
7.2. Amendment Controls. If any topic is addressed both in the Purchase Agreement (or any document related thereto) and in this Amendment, this Amendment shall control.
7.3 Construction. The headings herein are for convenience only, do not constitute a part of this Amendment and shall not be deemed to limit or affect any of the provisions hereof. The language used in this Amendment will be deemed to be the language chosen by the parties to express their mutual intent, and no rules of strict construction will be applied against any party.
7.4 Governing Law. All questions concerning the construction, validity, enforcement and interpretation of this Amendment shall be governed by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles of conflicts of law thereof. The parties agree that Section 7.9 of the Purchase Agreement shall apply to this Amendment as if set forth in its entirety herein.
7.5 Survival. The representations and warranties contained herein shall survive for the applicable statue of limitations.
7.6 Execution. This Amendment may be executed in two or more counterparts, all of which when taken together shall be considered one and the same document and shall become effective when counterparts have been signed by each party and delivered to the other party, it being understood that both parties need not sign the same counterpart.
7.7 Severability. If any provision of this Amendment is held to be invalid or unenforceable in any respect, the validity and enforceability of the remaining terms and provisions of this Amendment shall not in any way be affected or impaired thereby and the parties will attempt to agree upon a valid and enforceable provision that is a reasonable substitute therefore, and upon so agreeing, shall incorporate such substitute provision in this Amendment.
7.8 Independent Nature of Purchasers’ Obligations and Rights. The obligations of each Purchaser hereunder are several and not joint with the obligations of any other Purchaser, and no Purchaser shall be responsible in any way for the performance of the obligations of any other Purchaser. Nothing contained herein, and no action taken by any Purchaser pursuant hereto, shall be deemed to constitute the Purchasers as a partnership, an association, a joint venture or any other kind of entity, or create a presumption that the Purchasers are in any way acting in concert or as a group with respect to such obligations or the transactions contemplated hereby. Each Purchaser shall be entitled to independently protect and enforce its rights, including, without limitation, the rights arising out of this Amendment and it shall not be necessary for any other Purchaser to be joined as an additional party in any proceeding for such purpose. The Purchasers have not relied upon the same legal counsel in their review and negotiation of this Amendment. Biophan has elected to provide all Purchasers with the same terms and form of Amendment for the convenience of Biophan and not because it was required or requested to do so by the Purchasers. Each Purchaser represents that it has been represented by its own separate legal counsel in its review and negotiations of this Amendment.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed by their respective authorized signatories as of the date first indicated above.
BIOPHAN TECHNOLOGIES, INC.
By: /s/ John F. Lanzafame Name: John F. Lanzafame Title: Chief Executive Officer
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK SIGNATURE PAGE FOR PURCHASERS FOLLOWS]
IN WITNESS WHEREOF, the undersigned have caused this Amendment to be duly executed by their respective authorized signatories as of the date first indicated above.
Name of Investing Entity: Iroquois Master Fund, Ltd.
Signature of Authorized Signatory of Investing Entity: /s/ Joshua Silverman
Name of Authorized Signatory: Joshua Silverman
Title of Authorized Signatory: Authorized Signatory
Email Address of Authorized Entity
Initial Below to Indicate Choice
Option A - Premium shares and cancellation of warrants
IN WITNESS WHEREOF, the undersigned have caused this Amendment to be duly executed by their respective authorized signatories as of the date first indicated above.
IN WITNESS WHEREOF, the undersigned have caused this Amendment to be duly executed by their respective authorized signatories as of the date first indicated above.
Name of Investing Entity: CAMOFI Master Fund LLC
Signature of Authorized Signatory of Investing Entity: /s/ Richard Edelson
Name of Authorized Signatory: Richard Edelson
Title of Authorized Signatory: CFO
Email Address of Authorized Entity:
Initial Below to Indicate Choice
Option A - Premium shares and cancellation of warrants RE
IN WITNESS WHEREOF, the undersigned have caused this Amendment to be duly executed by their respective authorized signatories as of the date first indicated above.
Name of Investing Entity: Cranshire Capital LP
Signature of Authorized Signatory of Investing Entity: /s/ Keith A. Goodman
Name of Authorized Signatory: Keith A. Goodman
Title of Authorized Signatory: COO - Downsview Capital, Inc., The General Partner
Email Address of Authorized Entity:
Initial Below to Indicate Choice
Option A - Premium shares and cancellation of warrants
IN WITNESS WHEREOF, the undersigned have caused this Amendment to be duly executed by their respective authorized signatories as of the date first indicated above.
Name of Investing Entity: Highbridge International, LLC By: Highbridge Capital management, LLC, its Trading Manager
Signature of Authorized Signatory of Investing Entity: /s/ Adam J. Chill
Name of Authorized Signatory: Adam J. Chill
Title of Authorized Signatory: Managing Director
Email Address of Authorized Entity:
Initial Below to Indicate Choice
Option A - Premium shares and cancellation of warrants A.C.
IN WITNESS WHEREOF, the undersigned have caused this Amendment to be duly executed by their respective authorized signatories as of the date first indicated above.
Name of Investing Entity: Rockmore Investment Master Fund, Ltd.
Signature of Authorized Signatory of Investing Entity: /s/ Michael Clateman
Name of Authorized Signatory: Michael Clateman
Title of Authorized Signatory: Managing Director
Email Address of Authorized Entity:
Initial Below to Indicate Choice
Option A - Premium shares and cancellation of warrants
IN WITNESS WHEREOF, the undersigned have caused this Amendment to be duly executed by their respective authorized signatories as of the date first indicated above.
Name of Investing Entity: Harborview Master Fund, L.P.
Signature of Authorized Signatory of Investing Entity: /s/ Susan Parker
Name of Authorized Signatory: Susan Parker Navigator Management Ltd., Authorized Signatory
Title of Authorized Signatory:
Email Address of Authorized Entity:
Initial Below to Indicate Choice
Option A - Premium shares and cancellation of warrants
IN WITNESS WHEREOF, the undersigned have caused this Amendment to be duly executed by their respective authorized signatories as of the date first indicated above.
Name of Investing Entity: Crescent International Ltd
Signature of Authorized Signatory of Investing Entity: /s/ Maxi Brezzi
Name of Authorized Signatory: Maxi Brezzi
Title of Authorized Signatory: Authorized Signatory
Email Address of Authorized Entity:
Initial Below to Indicate Choice
Option A - Premium shares and cancellation of warrants MB
IN WITNESS WHEREOF, the undersigned have caused this Amendment to be duly executed by their respective authorized signatories as of the date first indicated above.
Name of Investing Entity: Atoll Asset Management, LLC/Truk Opportunity Fund, LLC
Signature of Authorized Signatory of Investing Entity: /s/ Mitchell Fein
Name of Authorized Signatory: Mitchell Fein
Title of Authorized Signatory: Vice President
Email Address of Authorized Entity:
Initial Below to Indicate Choice
Option A - Premium shares and cancellation of warrants MF
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 Agreement) unless the same consideration is also offered to all of the parties to the Transaction Documents (and the Forbearance Agreement). For clarification purposes, this provision constitutes a separate right granted to Purchaser and each of the other parties to the Purchase Agreement by Biophan and negotiated separately by Purchaser and each of the other parties to the Purchase Agreement, and is intended to treat, for Biophan, the Purchaser and the other parties to the Purchase Agreement as a class and shall not in any way be construed as the Purchasers acting in concert or as a group with respect to the purchase, disposition or voting of Securities or otherwise.
5. Public Announcement. Biophan shall, by 8:30 a.m. Eastern time on September 24, 2008, issue a press release disclosing the material terms of the transactions contemplated hereby and timely file a Current Report on Form 8-K (the “8-K Filing”), attaching such press release and this Amendment. From and after the filing of the 8-K Filing with the Commission, the Company represents that Purchaser shall not be in possession of any material, nonpublic information received from the Company, any of its Subsidiaries or any of its respective officers, directors, employees or agents that is not disclosed in the 8-K Filing. Biophan shall not, and shall cause each of its Subsidiaries and its and each of their respective officers, directors, employees and agents, not to, provide Purchaser with any material, nonpublic information regarding the Company or any of its Subsidiaries from and after the filing of the 8-K Filing with the Commission without the express written consent of Purchaser.
6. Notices. Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall be in writing and shall be deemed given and effective as specified in the Purchase Agreement. The address for such notices and communications shall be as set forth on the signature pages attached to the Purchase Agreement.
7. Miscellaneous.
7.1. Amendments; Waivers. No provision of this Amendment may be waived or amended except in a written instrument signed, in the case of an amendment, by Biophan, Purchaser and all of the other parties to the Purchase Agreement or, in the case of a waiver, by the party against whom enforcement of any such waiver is sought. No waiver of any default with respect to any provision, condition or requirement of this Amendment shall be deemed to be a continuing waiver in the future or a waiver of any subsequent default or a waiver of any other provision, condition or requirement hereof, nor shall any delay or omission of either party to exercise any right hereunder in any manner impair the exercise of any such right.
7.2. Amendment Controls. If any topic is addressed both in the Purchase Agreement (or any document related thereto) and in this Amendment, this Amendment shall control.
7.3 Construction. The headings herein are for convenience only, do not constitute a part of this Amendment and shall not be deemed to limit or affect any of the provisions hereof. The language used in this Amendment will be deemed to be the language chosen by the parties to express their mutual intent, and no rules of strict construction will be applied against any party.
7.4 Governing Law. All questions concerning the construction, validity, enforcement and interpretation of this Amendment shall be governed by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles of conflicts of law thereof. The parties agree that Section 7.9 of the Purchase Agreement shall apply to this Amendment as if set forth in its entirety herein.
7.5 Survival. The representations and warranties contained herein shall survive for the applicable statue of limitations.
7.6 Execution. This Amendment may be executed in two or more counterparts, all of which when taken together shall be considered one and the same document and shall become effective when counterparts have been signed by each party and delivered to the other party, it being understood that both parties need not sign the same counterpart.
7.7 Severability. If any provision of this Amendment is held to be invalid or unenforceable in any respect, the validity and enforceability of the remaining terms and provisions of this Amendment shall not in any way be affected or impaired thereby and the parties will attempt to agree upon a valid and enforceable provision that is a reasonable substitute therefore, and upon so agreeing, shall incorporate such substitute provision in this Amendment.
7.8 Independent Nature of Purchasers’ Obligations and Rights. The obligations of Purchaser hereunder are several and not joint with the obligations of any other party to the Purchase Agreement, and Purchaser shall not be responsible in any way for the performance of the obligations of any other party to the Purchase Agreement. Nothing contained herein, and no action taken by Purchaser pursuant hereto, shall be deemed to constitute Purchaser as a member of a partnership, an association, a joint venture or any other kind of entity, or create a presumption that Purchaser and any of the other parties to the Purchase Agreement are in any way acting in concert or as a group with respect to such obligations or the transactions contemplated hereby. Purchaser shall be entitled to independently protect and enforce its rights, including, without limitation, the rights arising out of this Amendment and it shall not be necessary for any party to the Purchase Agreement to be joined as an additional party in any proceeding for such purpose. Purchaser has not relied upon the same legal counsel in its review and negotiation of this Amendment. Biophan has elected to provide Purchaser with the same terms and form of Amendment as provided to all other parties to the Purchase Agreement for the convenience of Biophan and not because it was required or requested to do so by any party to the Purchase Agreement. Purchaser represents that it has been represented by its own separate legal counsel in its review and negotiations of this Amendment.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed by their respective authorized signatories as of the date first indicated above.
BIOPHAN TECHNOLOGIES, INC.
By: Name: John F. Lanzafame Title: Chief Executive Officer
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK SIGNATURE PAGE FOR PURCHASERS FOLLOWS]
IN WITNESS WHEREOF, the undersigned have caused this Amendment to be duly executed by their respective authorized signatories as of the date first indicated above.
Name of Investing Entity: Castlerigg Master Investments Ltd.
Signature of Authorized Signatory of Investing Entity:
Name of Authorized Signatory:
Title of Authorized Signatory:
Email Address of Authorized Entity:
Initial Below to Indicate Choice
Option A - Premium shares and cancellation of warrants
This Amendment No. 2 (the “Amendment”)is made as of September 23, 2008, by and between Biophan Technologies, Inc., a Nevada corporation (the "Borrower") and Biomed Solutions, LLC, a New York limited liability company (the "Lender").
Whereas the Borrower and the Lender are parties to a certain Line of Credit Agreement dated as of January 24, 2006, and amended on October 11, 2006 (as amended, the "Agreement"), pursuant to which the Lender agreed to lend to the Borrower an amount of up to $5,000,000 (the "Line of Credit");
Whereas, the Borrower issued to the Lender a Convertible Promissory Note in the original principal amount of $5,000,000 (the "Note") to evidence advances made to the Borrower’s under the Agreement;
Whereas, the Borrower entered into a Securities Purchase Agreement dated as of the date hereof October 11, 2006, which was amended on October 3, 2007 (as amended, the "SPA") among the Borrower and the Purchasers named therein (the "Purchasers"), pursuant to which the Purchasers extended credit to the Borrower;
Whereas, as a condition to the SPA, the Purchasers requested certain amendments to the Agreement that were made in the October 11th Amendment of the Agreement; and
Whereas, there are certain intercompany billings due and owing from Lender to Borrower for services provided by the Borrower for the benefit of the Lender in the amount of $78,480.10 (the “Billings”);
Whereas, the Lender and the Borrower have determined that it is in their mutual best interests to extend the maturity date for repayment of the Line of Credit, and the Note evidencing advances in respect thereof;
Now, therefore, in consideration of ten dollars ($10.00), the mutual covenants contained herein, and other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the Borrower and the Lender hereby agree as follows:
1. Provided that Borrower is not contractually prohibited by the SPA or the terms of the ancillary agreements executed in connection therewith, the Billings shall be allowed in full as a credit against, and repayment of, the Line of Credit and principal balance of the Note. However, if Borrower remains contractually prohibited by the SPA or the terms of the ancillary agreements executed in connection therewith from making payments on account of the Line of Credit and/or the Note, then the terms of the October 11th Amendment shall remain in effect and unmodified by this Amendment.
2. Provided that Borrower is not contractually prohibited by the SPA or the terms of the ancillary agreements executed in connection therewith, all future intercompany billings due and owing from Lender to Borrower for services provided by the Borrower for the benefit of the Lender shall be allowed in full as a credit against, and repayment of, the Line of Credit and principal balance of the Note. However, if Borrower remains contractually prohibited by the SPA or the terms of the ancillary agreements executed in connection therewith from making payments on account of the Line of Credit and/or the Note, then the terms of the October 11th Amendment shall remain in effect and unmodified by this Amendment.
3. At such time as Borrower no longer is prohibited by the holders of its senior secured notes from making payments on account of the Line of Credit, Borrower promptly will begin making monthly payments to Lender on account of the Line of Credit and the principal balance of (and accrued interest under) the Note, on the first day of each month, in the amount of $15,000 (the “Monthly Payments”), to be applied to principal and accrued interest on a pro rata basis.
4. Interest on the unpaid principal balance of the Note will continue to accrue at the rate of 8% per annum until the principal amount of the Note is repaid in full.
5. The term of repayment of the Line of Credit and the Note will be extended for a period of three years, commencing on December 31, 2009.
6. If Borrower secures new financing in an amount that exceeds $5 million, and Borrower is not then contractually prohibited (by the terms of such financing or otherwise) from making payments on account of the Line of Credit, then Borrower shall commence or continue the Monthly Payments, as the case may be, and shall increase the amount of the Monthly Payments from $15,000 per month to $20,000 per month and, additionally, shall repay ratably over three months following the closing (and funding) of such financing all accrued but unpaid interest under the Line of Credit and the Note.
7. Except as expressly amended hereby, the Agreement and the Note shall remain full force and effect without any other alteration or change.
In witness whereof, the parties have executed this Amendment as of the date first above written.
BIOMED SOLUTIONS, LLC BIOPHAN TECHNOLOGIES, INC.
By: /s/ Michael L. Weiner By: /s/ Margaret V. Russell
-------------------------------------------------------------------------------- Michael L. Weiner, Manager -------------------------------------------------------------------------------- Margaret V. Russell, Chief Financial Officer
Frees Company to Partner Technologies, Seek New Acquisitions
ROCHESTER, N.Y -September 24, 2008--Biophan Technologies, Inc. (OTCBB: BIPH - News) today announced execution of a prepayment agreement with the holders of its senior debt.
The prepayment agreement eliminates the remaining $2.3 million in senior debt that would have been paid by issuance of common stock, and cancelled warrants held by the note holders to purchase another 17 million shares of commons stock, in exchange for a cash payment of $2.15 million plus delivery of 18 million shares. The prepayment agreement leaves the Company with twelve months of cash available.
John Lanzafame, Biophan’s CEO, stated, “This settlement is an important transaction for Biophan. Prepayment of the senior debt eliminates further dilution to our shareholders that would have resulted from the monthly common share issuances for payments under the notes and the purchase of the warrant shares and removes the constraints imposed upon the Company by the senior debt agreements. This transaction puts the Company in a much stronger position to move forward on meaningful transactions designed to bring our technologies to the market and to seek acquisitions of new technologies to bring additional value to our shareholders.”
About Biophan Technologies, Inc. Biophan is dedicated to providing technologies that offer innovative and competitive advantages to the medical device industry. The Company is helping to commercialize the Myotech Circulatory Support System, which has significant potential to improve the treatment of acute heart failure. Biophan Technologies, Inc. holds a 70% interest in Myotech with rights to acquire additional equity, and is leading Myotech's business development efforts. Biophan is traded on the OTC market under the symbol BIPH, and is also listed on the Frankfurt Stock Exchange under the symbol BTN. For more information on Biophan, please visit our website at www.biophan.com.
Cautionary Statement Regarding Forward-Looking Statements Certain statements included in this press release may constitute forward-looking statements within the meaning of applicable securities laws. These statements reflect what Biophan anticipates, expect, or believe may happen in the future. Biophan's actual results could differ materially from the outcome or circumstance expressed or implied by such forward-looking statements as a result of a variety of factors including, but not limited to: Biophan's ability to develop its technologies; the approval of Biophan's patent applications; the successful implementation of Biophan's research and development programs; the ability of Biophan to demonstrate the effectiveness of its technology; the acceptance by the market of Biophan's technology and products incorporating such technology; the ability of Biophan to effectively negotiate and enter into contracts with medical device manufacturers for the licensing of Biophan's technology; competition; the ability of Biophan to raise capital to fund its operating and research and development activities until it generates revenues sufficient to do so; and the timing of projects and trends in future operating performance, as well as other factors expressed from time to time in Biophan's periodic filings with the Securities and Exchange Commission (the "SEC"). As a result, this press release should be read in conjunction with Biophan's periodic filings with the SEC, which are incorporated herein by reference. The forward-looking statements contained herein are made only as of the date of this press release, and Biophan undertakes no obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances.
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