Exhibit
10.40

     

    AVAX
TECHNOLOGIES, INC.

     

    FORM
OF AMENDMENT NO. 3 TO

     

    2008
CONVERTIBLE NOTE AND WARRANT PURCHASE AGREEMENT

     

    and

     

    2008
CONVERTIBLE PROMISSORY NOTE

     

    Dated
as of October 15, 2009

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    This
Amendment No. 3 to Convertible Note and Warrant Purchase Agreement and
Convertible Promissory Note (this “Amendment”) is entered into effective as of
October 15, 2009, by and between AVAX Technologies, Inc., a Delaware corporation
(the “Company”), and each of the purchasers (the
“Purchasers”) of the Company’s 6% Convertible
Notes due March 31, 2009 (the “Notes”) issued pursuant to that certain
Convertible Note and Warrant Purchase Agreement, dated as of October 24, 2008,
by and between the Company and the Purchasers, as amended by that certain
Amendment to Convertible Note and Warrant Purchase Agreement, dated as of
October 24, 2008, and by that certain Amendment No. 2 to Convertible Note and
Warrant Purchase Agreement and Convertible Promissory Note, dated as of January
31, 2009 (the “Purchase
Agreement”). Capitalized terms
used and not otherwise defined herein shall have the meanings ascribed to them
in the Purchase Agreement.

     

    WHEREAS,
the Purchase Agreement may be amended only by mutual written agreement of the
Company and the Purchasers holding a majority of the principal amount of Notes
issued under the Purchase Agreement and the Notes may be amended upon written
consent of the Company and the holder of each of the Notes; and

     

    WHEREAS,
pursuant to the Purchase Agreement, the Notes are currently due on March 31,
2009; and

     

    WHEREAS,
the Company and the Purchasers desire to amend the Purchase Agreement and the
Notes to extend the maturity date of the Notes to June 1, 2010;

     

    and

     

    WHEREAS,
the Company and the Purchasers desire to amend certain other provisions of the
Purchase Agreement and the Notes as set forth herein.

     

    NOW,
THEREFORE, in consideration of the foregoing and the promises and covenants
contained herein, and for other good and valuable consideration, the receipt of
which is hereby acknowledged, the parties hereto agree as follows:

     

    
      	
               
      

            	
              1.

            	
              Amendment to Preamble
      of the Purchase Agreement. The preamble of the Purchase Agreement
      is hereby amended and restated in its entirety as
  follows:

            


    

     

    AVAX
Technologies, Inc., a Delaware corporation (the “Company”), proposes, subject to
the terms and conditions contained herein, to sell to the Purchasers listed on
the signature pages hereto (individually, a “Purchaser” and collectively the
“Purchasers”), up to $1,500,000 aggregate principal amount of the Company’s 6%
Convertible Notes due June 1, 2010 (individually, a “Note” and collectively, the
“Notes”) and warrants to purchase up to 15,000,000 fully paid and non-assessable
shares of common stock, par value $.004 per share, of the Company (the “Common
Stock”) for $0.015 per share (individually a “Warrant” and collectively, the
“Warrants”) pursuant to this Convertible Note and Warrant Purchase Agreement
(the “Agreement”). The Notes will be convertible into shares of Common Stock or
other securities of the Company, as more fully described
therein.


    
      
         


      

      
         


        
          

        

      

      
         


      

    

     

    The sale
of the Notes and Warrants to the Purchasers will be made without registration of
the Notes or Warrants under the Securities Act of 1933, as amended (the
“Securities Act”) in reliance upon an exemption from the registration
requirements of the Securities Act.

     

    
      	
               
      

            	
              2.

            	
              Amendment to Preamble
      of the Convertible Promissory Note. The preamble of each of the
      Notes is hereby amended and restated in its entirety as
      follows:

            


    

     

    AVAX
TECHNOLOGIES, INC., a Delaware corporation (the “Company”), for value received,
promises to pay to [______] or registered assigns (the “Holder”), the principal
sum of [__________] Dollars $[______] on June 1, 2010, and interest (computed on
the basis of a 365-day year) from the date hereof on the unpaid principal amount
from time to time outstanding at the rate of six percent (6%) per annum, due and
payable in arrears on the maturity date hereof, unless payment is required at an
earlier date pursuant to the terms hereof. This Note is one of a series of
similar Notes issued by the Company in the aggregate principal amount not to
exceed $1,500,000.

     

    
      	
               
      

            	
              3.

            	
              Amendment to Section 1
      of the Convertible Promissory Note. Section 1 (a) and (b) of each
      of the Notes is hereby amended and restated in its entirety as
      follows:

            


    

     

    1.
Conversion.

     

    (a)    Voluntary Conversion.
At any time after the date hereof until this Note is no longer outstanding, this
Note shall be convertible, in whole or in part, into shares of Common Stock,
$.004 par value per share, of the Company (“Common Stock”) at the option of the
Holder, at any time and from time to time, at a rate of one (1) share of Common
Stock for each $0.01 (subject to adjustment, the “Conversion Price”) of unpaid
principal of and interest on this Note on the Conversion Date (as defined
below). The Holder shall effect conversions by delivering to the Company a
Notice of Conversion specifying therein the principal amount of the Note to be
converted and the date on which such conversion shall be effected (such date,
the “Conversion Date”). If no Conversion Date is specified in a Notice of
Conversion, the Conversion Date shall be the date that such Notice of Conversion
is deemed delivered hereunder. Conversions hereunder shall have the effect of
lowering the outstanding principal amount of the Note in an amount equal to the
applicable conversion. The Holder and the Company shall maintain records showing
the principal amount(s) converted and the date of such
conversion(s).


    
      
         


      

      
         


        
          

        

      

      
         


      

    

     

    (b)   Mandatory Conversion.
This Note shall automatically convert into the securities described below and at
the conversion ratios described below upon the closing of the Offering (as
defined in Section 1(c)) if the closing of the Offering occurs on or prior to
the maturity date of this Note. Upon the closing of the Offering, all principal
of and accrued and unpaid interest on this Note will automatically convert, at
the election of the Holder, into either (i)l share of Common Stock, $.004 par
value per share, of the Company (“Common Stock”) for each $0.01 of unpaid
principal of and interest on this Note on the conversion date, or (ii) into that
number of securities issued by the Company in the Offering equal to the quotient
obtained by dividing the principal and accrued interest owed hereunder on the
conversion date by the lesser of (a) $.01 or (b) ninety-nine percent (99%) of
the price at which the securities are issued in the Offering and otherwise on
the same terms and conditions and with the same rights and preferences as the
securities issued in the Offering. To exercise this election as to the form and
amount of securities to be received upon conversion of this Note, the Holder
shall deliver to the Company during usual business hours at the Company’s
principal executive office written notice in form satisfactory to the Company
that the Holder elects to receive the conversion securities specified in either
clause (i) or clause (it) above. Such notice shall also state the name or names
(with address) in which the certificate or certificates for shares (or other
securities) that are issuable on such conversion are to be
registered.

     

    
      	
               
      

            	
              4.

            	
              Effect of
      Amendment. Except as expressly modified by this Amendment, the
      Purchase Agreement and the Notes shall remain unmodified and in full force
      and effect.

            


    

     

    
      	
               
      

            	
              5.

            	
              Governing Law.
      This Amendment shall be construed and enforced in accordance with, and the
      rights of the parties shall be governed by, the laws of the State of
      Delaware, without giving effect to the principles of conflicts of law
      thereof.

            


    

     

    
      	
               
      

            	
              6.

            	
              Counterparts.
      This Amendment may be executed in any number of counterparts and
      signatures delivered by facsimile, each of which shall be deemed an
      original, but all of which together shall constitute one
      instrument.

            


    


    
      
         


      

      
         


        
          

        

      

      
         


      

    

     

    IN
WITNESS HEREOF, the parties hereto have executed this Amendment as of the date
first written above.

    


    COMPANY:
AVAX TECHNOLOGIES,  INC.

    


    
      
        
          	
                  By:

                	 
      	 
      
	
                  Name:

                	
                   
      

                	 
      
	
                  Title:

                	
                   
      

                	 
      


        

      

    

     

    PURCHASERS:

    


    
      
        
          
            
              	
                      Firebird
      Global Master Fund, Ltd.

                    	 
      
	 	 
	
                      By:

                    	 
      	 
      
	
                      Name:

                    	 
      	 
      
	 
      	 
      	 
      
	
                      Rock
      Castle Ventures, L,P.

                    	 
      
	 
      	 
      	 
      
	
                      By:

                    	 
      	 
      
	
                      Name:

                    	 
      	 
      
	 
      	 
      	 
      
	
                      JFE
      Hottinger & Co.

                    	 
      
	 
      	 
      	 
      
	
                      By:

                    	 
      	 
      
	
                      Name:

                    	 
      	 
      
	 
      	 
      	 
      
	
                      R
      & H Trust Co.

                    	 
      
	 
      	 
      	 
      
	
                      By:

                    	 
      	 
      
	
                      Name:

                    	 
      	 
      
	 
      	 
      	 
      
	
                      Paul
      S. Larue

                    	 
      
	 
      	 
      	 
      
	
                      By:

                    	 
      	 
      
	
                      Name:

                    	 
      	 
      


            

          

        

      

    


    
      
         


      

      
         


        
          

        

      

      
         


      

    

    


    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            
                                              
                                                	
                                                        Herr
      Pierre-Alain Mathier

                                                      	 
      
	 
      	 
      	 
      
	
                                                        By:

                                                      	 
      	 
      
	
                                                        Name:

                                                      	 
      	 
      
	 
      	 
      	 
      
	
                                                        Nicholas
      Oltamare

                                                      	 
      
	 
      	 
      	 
      
	
                                                        By:

                                                      	 
      	 
      
	
                                                        Name:

                                                      	 
      	 
      
	 
      	 
      	 
      
	
                                                        Francois
      R. Martelet

                                                      	 
      
	
                                                         
      

                                                      	 
      	 
      
	
                                                        By:

                                                      	 
      	 
      
	
                                                        Name:

                                                      	 
      	 
      
	 
      	 
      	 
      
	
                                                        John
      K.A. Prendergast

                                                      	 
      
	
                                                         
      

                                                      	 
      	 
      
	
                                                        By:

                                                      	 
      	 
      
	
                                                        Name:

                                                      	 
      	 
      
	 
      	 
      	 
      
	
                                                        Andrew
      W. Dahl

                                                      	 
      
	
                                                         
      

                                                      	 
      	 
      
	
                                                        By:

                                                      	 
      	 
      
	
                                                        Name:

                                                      	 
      	 
      
	 
      	 
      	 
      
	
                                                        Carl
      Spana

                                                      	 
      
	
                                                         
      

                                                      	 
      	 
      
	
                                                        By:

                                                      	 
      	 
      
	
                                                        Name:

                                                      	 
      	 
      
	
                                                         
      

                                                      	 
      	 
      
	
                                                        Edson
      D. deCastro

                                                      	 
      
	 	 	 
	
                                                        By:

                                                      	 
      	 
      
	
                                                        Name: