THE ISSUANCE OF THE SECURITIES EVIDENCED HEREBY HAS NOT BEEN REGISTERED WITH THE
UNITED STATES SECURITIES AND EXCHANGE COMMISSION UNDER THE U.S. SECURITIES ACT
OF 1933, AS AMENDED (THE "ACT"), OR THE SECURITIES COMMISSION OF ANY STATE UNDER
ANY STATE SECURITIES LAW.  THE SECURITIES WERE ISSUED PURSUANT TO A SAFE HARBOR
FROM REGISTRATION UNDER REGULATION S ("REGULATION S") PROMULGATED UNDER THE ACT.
 THE SECURITIES MAY NOT BE OFFERED, SOLD, OR OTHERWISE TRANSFERRED UNLESS SUCH
OFFERS, SALES, AND TRANSFERS ARE REGISTERED UNDER THE ACT AND APPLICABLE STATE
SECURITIES LAWS, ARE MADE PURSUANT TO AN AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THOSE LAWS, OR ARE MADE IN ACCORDANCE WITH
REGULATION S PROMULGATED UNDER THE ACT.  FURTHERMORE, HEDGING TRANSACTIONS
INVOLVING THE SECURITIES MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE ACT.

$375,000.00US

              

Owego, New York

     February 12, 2007

BIOLIFE SOLUTIONS, INC.

PROMISSORY NOTE

BioLife Solutions, Inc., a Delaware corporation (the “Maker”), for value
received, hereby promises to pay to Thomas Girschweiler (the “Holder”), the
principal amount of three hundred seventy five thousand Dollars ($375,000.00US)
(the “Issue Price”), together with interest on the unpaid amount thereof, in
accordance with the terms hereof, from the date hereof until paid or converted
in accordance with the terms hereof.  

1.

Promissory Note (“Note”).

1.1

Interest Rate.  The rate of interest hereunder (“Interest Rate”) shall equal
seven percent (7%) per annum and shall be computed on the basis of a 365 day
year for the actual number of days elapsed; provided that in no event shall the
interest rate be less than the minimum rate of interest required in order to
avoid the imputation of interest for federal income tax purposes.

1.2

Payment.  Subject to the provisions of  Section 4 regarding the automatic
conversion of this Note upon a Financing (as defined therein), the Issue Price
plus all accrued interest thereon shall become due and payable in one lump sum
on the earlier of (a) February 12, 2009 (the “Due Date”) or (b) an Event of
Default (as defined below).  The Maker may at any time prepay in whole or in
part the principal and interest accrued under this Note.  Any payment will be
applied first to the payment of any and all accrued and unpaid interest through
the payment date and second to the payment of principal remaining due hereunder.
 Payment shall be made at the offices or residence of the Holder, or at such
other place as the Holder shall have designated to the Maker in writing, in
lawful money of the United States of America.

1.3

Note Purchase Agreement.  This Note is issued pursuant to a Note Purchase
Agreement, dated the date hereof, by and between Maker and Holder and is subject
and entitled to the terms, conditions, covenants, and agreements contained
therein.

2

Acquisition.   In the event the Maker is to be acquired, whether by means of a
merger, sale of all or substantially all of the assets of the Maker, sale of
securities representing more than fifty percent (50%) of the equity interests in
Maker, or otherwise, prior to the Due Date (an “Acquisition”), then the Issue
Price plus all accrued but previously unpaid interest thereon shall become due
and payable in one lump sum immediately upon the closing of such Acquisition.

3.

Events of Default.  The Issue Price and accrued interest on this Note shall, at
the option of the Holder, become due and payable, subject to applicable law,
upon the happening of any one of the following specified events:

(a)

a decree or order of a court having jurisdiction is entered adjudging the Maker
a bankrupt or insolvent, or issuing sequestration or process of execution
against, or against any substantial part of, the property of the Maker, or
appointing a receiver of the Maker or any substantial part of its property, or
ordering the winding-up or liquidation of its affairs, unless the Maker actively
and diligently contests in good faith such decree or order and has such decree
or order stayed on or before 60 days after the issue of such decree or order by
a court;

(b)

an order is made or a resolution is passed for the winding-up or liquidation of
the Maker, or the Maker institutes proceedings to be adjudicated a bankrupt or
insolvent, or consents to the institution of bankruptcy or insolvency
proceedings against it, or consents to the filing of any such petition or to the
appointment of a receiver of the Maker or any substantial part of its property,
or makes a general assignment for the benefit of creditors, or admits in writing
its inability to pay its debts generally as they become due, or takes corporate
action in furtherance of any of the aforesaid purposes;

(c)

the Maker defaults in observing or performing any material covenant or condition
of this Note or the Unit Purchase Agreement on its part to be observed or
performed, and such default continues for a period of fifteen (15) days after
notice in writing has been given to the Maker by the Holder specifying such
default and requiring the Maker to rectify the same;

(d)

an encumbrancer takes possession of all or substantially all of the property of
the Maker, or any process of execution is levied or enforced upon or against all
or substantially all of the property of the Maker and remains unsatisfied for
such period as would permit any such property to be sold thereunder, unless the
Maker actively and diligently contests in good faith such process, but in that
event the Maker shall, if the Holder so requires, give security which, in the
discretion of the holder, is sufficient to pay in full the amount thereby
claimed in case the claim is held to be valid.

--------------------------------------------------------------------------------

4.

Conversion.

4.1

Conversion.   If this Note is outstanding at the time of any bona fide equity
financing of the Maker of at least One Million Dollars ($1,000,000), excluding
conversion of this Note (a “Financing”), then, concurrently with the
consummation of the Financing, Holder shall have the right (but not the
obligation) (“Conversion Right”) to convert this Note, plus all accrued and
unpaid interest thereon (the “Conversion Amount”) into that number of fully paid
and non-assessable shares or units of the equity security(ies) of the Maker sold
in the Financing (the “New Equity Securities”) as is equal to the Conversion
Amount divided by 85% of the per share or per unit purchase price of the New
Equity Securities.  The date of the consummation of the Financing is hereinafter
referred to as the “Closing Conversion Date”).

4.2

Conversion Procedure.  

(a)

The Maker shall provide the Holder written notice of the Financing at least
fifteen (15) days prior to the Closing Date.

(b)

In order to exercise the Conversion Right, Holder shall provide the Maker at
least five (5) days prior to the Closing Date written notice that the Holder
elects to convert the Note on the Closing Date.

4.3

Termination of Rights Upon Conversion.  Upon the Closing Date, subject to the
completion of the Financing, the Holder of this Note shall have no further
rights under this Note, whether or not this Note is surrendered.

4.4

Fractional Shares. No fractional shares or units of New Equity Securities of the
Maker will be issued in connection with any conversion hereunder but rather any
such fractional shares or units shall be rounded up to the nearest whole share
or unit.

4.5

Delivery of Stock Certificates.  As promptly as practicable after the Closing
Date, (a) the Maker shall give notice to the Holder of the conversion of this
Note into the New Equity Securities, (b) the Holder shall return this Note to
the Maker, and (c) the Maker, at its expense, shall issue and deliver to the
Holder of this Note a certificate or certificates evidencing the number of full
New Equity Securities issuable to the Holder upon such conversion.

5.

Miscellaneous.

5.1

Transfer of Note.  This Note shall not be transferable or assignable in any
manner and no interest shall be pledged or otherwise encumbered by the Holder
without the consent of the Maker, which consent shall not be unreasonably
withheld.

5.2

Titles and Subtitles.  The titles and subtitles used in this Note are for
convenience only and are not to be considered in construing or interpreting this
Note.

5.3

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

5.4

Amendments and Waivers.  This Note may be amended and the observance of any
other term of this Note may be waived (either generally or in a particular
instance and either retroactively or prospectively), with the written consent of
the Maker and the Holder.  The Maker waives presentment, demand for performance,
notice of nonperformance, protest, notice of protest, and notice of dishonor.
 No delay on the part of the Holder in exercising any right hereunder shall
operate as a waiver of such right under this Note.

5.5

Severability.  If one or more provisions of this Note are held to be
unenforceable under applicable law, such provision shall be excluded from this
Note and the balance of the Note shall be interpreted as if such provision were
so excluded and shall be enforceable in accordance with its terms.

5.6

Governing Law.  This Note shall be governed by and construed and enforced in
accordance with the laws of the State of New York, without giving effect to its
conflicts of laws principles.

Executed as of the date first written above.

 

 

 

MAKER:

 

 

 

BIOLIFE SOLUTIONS, INC.

 

 

 

a Delaware corporation

 

 

 

 

 

 

 

 

 

 

By:

/s/ Michael P. Rice

 

 

Title:

President and Chief Executive Officer

 

 

Name:

Michael P. Rice

 

 

Address:

171 Front Street, Owego, NY13827

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