EXHIBIT 10.78
AMENDMENT TO 8% SECURED PROMISSORY NOTE
This Amendment to 8% Secured Promissory Note (the "Note") is made this
22nd day of November, 2002 by and between VlRAGEN, INC. ("Viragen") and
ISOSCELES FUND LTD. {"lsosceles"):
WHEREAS, Viragen has issued its full recourse 8% Secured Promissory Note
to Isosceles secured by 2,500,000 shares of common stock of Viragen and which
provides for certain registration rights under the Securities Act of 1933 with
respect to such underlying shares of common stock; and
WHEREAS, the parties desire to modify the terms of the Note as hereinafter
provided:
THEREFORE, the parties hereby agree to the following modifications of the
Note:
1. The Note shall not have a fixed maturity date and shall be payable
within three (3) business days of demand by the noteholder.
2. The Note shall be convertible in whole or in part at a conversion
price of $0.175 per share, subject to adjustments as set forth in that
Securities Purchase Agreement and related 5% Secured Convertible Debenture dated
November 8, 2002. Interest on the Note shall be payable in cash or common stock
of Viragen, in whole or in part, in the sole option of Isosceles at the
applicable conversion price of the Note.
3. During the period that the Note is outstanding, Isosceles shall have
the same Note conversion and Warrant exercise prices as do the investors for the
above Securities Purchase Agreement. In addition, Isosceles shall have the
benefit of anti-dilution protection on a weighted basis in the event of any
issuances of capital stock or derivative securities involving the issuance of
capital stock at below the conversion price to other parties. The intention of
this anti-dilution provision is that Isosceles shall have the same conversion
price on the Note and exercise price for the Warrants that the investors for the
Securities Purchase Agreement referred to above have irregardless of a weighted
calculation, and would have the benefit of anti-dilution protection on a
weighted basis in the event of any issuances of capital stock or derivative
securities attributable to issuance of securities to other investors during the
time that the Notes and Warrants are outstanding.
4. Viragen agrees to register the 2,500,000 shares of its common stock
presently in escrow with Xxxxxx & Xxxx, P.A. pursuant to the Note and such
additional shares to cover common stock underlying the Note (including interest
thereon), at its own cost, within 30 days of the date hereof and to process such
registration statement in an expeditious manner. Isosceles shall have the same
protections as afforded to the investors in the above Securities Purchase
Agreement under the Registration Rights Agreement provided to such investors.
5. In the event that Isosceles does not elect to convert the entire
principal amount due under its 8% Secured Promissory Note within 90 days of the
date of this Amendment and in consideration for the execution of this Amendment,
Viragen shall issue to Isosceles three-year Warrants to purchase 116,500 shares
of Viragen common stock at an exercise price of $0.25; three-year Warrants to
purchase 116,500 shares of Viragen common stock at an exercise price of $0.30
per share; three-year Warrants to purchase 116,500 shares of Viragen common
stock at an exercise price of $0.35 per share; three-year warrants to purchase
406,250 shares of Viragen common stock exercisable at $0.50 per share; and
three-year Warrants to purchase 375,000 shares of Viragen common stock
exercisable at $0.60 per share, with the latter two Warrants providing for the
right of Viragen to compel the exercise of such Warrants in the same manner as
provided to the investors in the above Securities Purchase Agreement. All of
such Warrants will have the same rights and protections as afforded to the
Warrants issued to the investors pursuant to the above Securities Purchase
Agreement. Viragen agrees to register the shares underlying the Warrants, at its
own cost, within 30 days after issuance and to process such registration
statement in an expeditious manner.
6. Except as modified herein, the Note shall remain in full force and
effect.
VIRAGEN, INC.
By: /s/ Xxxxxx X. Xxxxxx 11/25/02
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Name: Xxxxxx X. Xxxxxx Date
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Its: Executive VP/CFO
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ISOSCELES FUND, LTD.
By: signatures illegible 25 November 2002
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Name: Date
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Its: Inter Caribbean Services (Bahamas) Ltd.
Authorized Signatory
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