Unassociated Document


    Exhibit
10.37

     

    Firebird
Global Master Fund, Ltd.

    


    October
28th, 2010

    


    Mr. John
Prendergast

    Chairman
and CEO

    Avax
Technologies, Inc.

    2000
Hamilton Street—Suite 204

    Philadelphia,
PA19130

     

    Re:   Offer to Invest Up to $2
Million in AVAX Technologies, Inc.

     

    Dear
John:
  

    Per our discussion last week, I am
hereby setting forth, on a non-binding basis, the terms and
conditions, under which Firebird Global Master Fund (“Firebird”) would be
willing to invest tip
to $2 million in AVAX
Technologies, Inc. ("AVAX"). The final terms of this offer (the "Offer") shall
only become binding upon the execution of definitive documentation by and
between AVAX and Firebird. Firebird intends to make its investment in
periodic installments. No investment shall be made by Firebird if certain
conditions precedent, as set forth herein, are not met, unless waived by
Firebird. The Offer shall remain open until Monday, November 1, 2010 at 12:00
Noon EDT.  The
terms of the
Offer are as follows:

    


    
      	
               
      

            	
              1.

            	
              Firebird
      will invest up to
      $2 million in the Company by exercising the warrants received in
      connection with its June 2010 purchase of $1 million in Common Stock and
      Warrants (the "2010 Firebird Financing"). The Company agrees that the
      proceeds are to be used for general working capital purposes and in
      furtherance of AVAX's stated objective to file a Form S-1 with the
      Securities and Exchange Commission ("SEC") on or before December 10,
      2010.

            


    

    
      	
               
      

            	
              2.

            	
              On
      Monday, November 1st, 2010,
      prior to 3:00 pm EDT, Firebird will deliver an executed exercise
      notice for such number of warrants (following certain adjustments in the
      number outstanding and exercise price as set forth in Paragraph 4 below)
      that will provide AVAX proceeds of approximately $1,300,000 (the "Initial
      Funding") and wire the funds needed to exercise the warrants to
      AVAX.

            


    

    
      	
               
      

            	
              3.

            	
              Thereafter,
      on or about the 15th day of December 2010 and again on the 15th
      day of January 2011,
      AVAX shall request that Firebird exercise warrants from the 2010 Firebird
      Financing sufficient to fund that month's capital needs (a "Subsequent
      Financing") and shall provide Firebird a budget reflecting such month's
      capital needs. It is Firebird's intention to fund such monthly capital
      needs (up to an aggregate of $2 million) If AVAX achieves certain
      milestones and goals to be agreed by Firebird and the Company, in good
      faith, after the Initial Funding, which may include, but shall not be
      limited to: (I) meeting budgets and/or satisfactorily explaining to
      Firebird variances therein; (ii) staying reasonably within the timelines
      established for certain events to occur both operationally and in
      connection with the contemplated filing of the S-1; (iii) conducting its
      business affairs in a manner deemed responsible by Firebird; and (iv)
      promptly providing Firebird with any information requested by Firebird,
      provided
      however, while
      Firebird shall retain the right to provide additional funding after the
      Initial Funding as described above,
      Firebird shall not have any obligation to do so and may elect not to
      provide such funding for any reason
  whatsoever.

            


    

     

    c/o
Trident Trust Company

    (Cayman)
Limited, Ono Capital Place, P.O. Box 847 GT, George Town, Grand Cayman, Cayman
Islands

    Phone:
(345) 949-0880, Fax: (345) 949-0881


    
      
         


      

      
         


        
          

        

      

      
         


      

    

     

    
      
        Firebird
Global Master Fund, Ltd. 

         

      

    

    
      	
               
      

            	
              4.

            	
              Prior
      to the Initial Funding all of the following conditions precedent shall be
      met:

            


    

    
      	
               
      

            	
              a.

            	
              AVAX
      shall reduce the exercise price of the warrants purchased in the 2010
      Firebird Financing to $0.0117 and issue Firebird 65,470,085 additional
      shares of Common Stock, the intent of which is to provide Firebird that
      number of additional shares such that, in essence, the Common Stock
      purchased in the 2010 Firebird Financing
      would have been priced at $0.0117 per share. All other warrants
      held by Firebird, with the exception of warrants held by virtue of its
      2007 investment in AVAX, shall be repriced to $0.0117 per share,
      irrespective of any provision in any warrant agreement that negates the
      need for an adjustment unless a certain minimum adjustment amount is met,
      such as set forth in paragraphs 3(f)(i) of the 2008 warrant issued in
      connection with the Convertible Notes issued in 2008 (the "2008 Notes"),
      the warrant issued in conjunction with Firebird's October 2009 investment
      of $1.4 million into AVAX, the warrant issued in connection with the 2010
      Firebird Financing and the April 2010 Stock and Warrant Offering the
      "April 2010 offering"), which each state something to the effect
      of:

            


    

     

    No
adjustments in the Exercise Terms shall be required:

    
      	
               
      

            	
              (i)

            	
              Unless
      such adjustment would require an increase or decrease of at least $0.01
      per share of Common Stock...

            


    

     

    Moreover,
all warrant and convertible debt documentation shall be amended to
remove, or at Firebird's
discretion, adjust downward, references to such minimum requirements or
the aggregation of
amounts that would be required
prior to an adjustment.

     

    
      	
               
      

            	
              b.

            	
                    All
      holders of the Convertible Notes issued in 2008, with the exception of
      Firebird, (the "2008 Noteholders"), shall convert their shares to AVAX
      Common Stock. All holders of the Convertible Notes Issued In 2008,
      including Firebird, shall forfeit any accrued interest after the June 1,
      2010 maturity date of such Notes. Promptly following the Initial Funding,
      AVAX and Firebird shall negotiate in good faith terms for an extension of
      the maturity date of such Notes, such that they are no longer in default
      and interest thereafter shall begin to
accrue.

            


    

    
      	
               
      

            	
              c.

            	
              All
      (i) holders of warrants issued in connection with the April 2010 Stock and
      Warrant Offering, with the exception of Firebird (the "April 2010
      Offerees" and together with the 2008 Noteholders, the "Offerees"), and
      (ii) holders, other than Firebird, of warrants issued with the 2008 Notes,
      shall (x) exercise all or part their warrants received in connection with
      these financings, at the original exercise price of $0.015 and (y) forfeit
      any and all unexercised warrants.

            


    

    


    c/o
Trident Trust Company

    (Cayman)
Limited, Ono Capital Place, P.O. Box 847 GT, George Town, Grand Cayman, Cayman
Islands

    Phone:
(345) 949-0880, Fax: (345) 949-0881


    
      
         


      

      
         


        
          

        

      

      
         


      

    

     

    
      Firebird
Global Master Fund, Ltd.
 

    

    
      	
               
      

            	
              d.

            	
                    AVAX
      shall provide Firebird a budget which demonstrates that with $2 million in
      funding, and absent unforeseen circumstances or circumstances beyond its
      control, AVAX should be able to take all steps necessary to file a
      Registration Statement on Form S-1 with the SEC by December 31, 2010 and
      to meet its operational funding requirements through January 2011. AVAX
      will also
      provide Firebird an unaudited balance
      sheet as of September
      30th, 2010, complete with
      annotations that describe those items which may be subject to material
      adjustment and the reasons why such material adjustments may be
      forthcoming.

            


    

    
      	
               
      

            	
              e.

            	
                    The
      Senior Officers and all Directors of AVAX will sign a statement, to be
      provided to Firebird, that such budget represents AVAX's best estimate of
      the funding requirements of the Company to meet the goals set forth above
      as of the date provided. Such Officers and Directors will also represent
      to Firebird in writing that they have
      undertaken a due diligence review, of appropriate thoroughness and
      sufficiency as would be reasonably expected from a public company
      officer or director, with respect to all information provided
      to Firebird in connection with such budget and the balance sheet
      requested in Paragraph 4d. Each Officer and Director shall further
      represent to Firebird in writing that to the best of his knowledge, the
      Company, and each Officer and Director has provided Firebird, in good
      faith, all material information of which such Person could or should be
      reasonably aware (as well as a representation that there have been no
      material omissions) that would be germane to Firebird in making an
      investment in the Company. Moreover, each Officer and Director shall
      represent in writing that it will make known to Firebird any material
      change in the business, operations, financial position or prospects or any
      other matter germane to any Subsequent Funding promptly after such Officer
      becomes aware of such material information and will conduct such due
      diligence reviews, of appropriate thoroughness and sufficiency as would be
      reasonably expected from a public company officer or director with respect
      to making oneself aware of such information on a timely basis given AVAX's
      current
circumstances.

            


    

    
      	
               
      

            	
              f.

            	
                    AVAX's
      shall provide each Offeree (and Firebird) a statement that reflects the
      number of shares and warrants each currently owns, the number of shares
      and warrants each will hold if it accepts the Offer (assuming Firebird
      exercises warrants, repriced as provided in this letter, from the 2010
      Firebird Financing) sufficient to provide $2 million in funding and no
      warrants are exercised by the Offerees) and the percentage ownership of
      each in AVAX both prior to accepting the Offer and should all Offerees
      accept the Offer. Categories to be shown in the statement shall include
      Firebird's holdings, the holdings of the particular Offeree to whom the
      statement is provided, the holdings of all other Offerees
      in the aggregate, and holders of all other Common Shares currently
      outstanding.

            


    

    
      	
               
      

            	
              g.

            	
                    AVAX
      shall provide a full and accurate written description of the offer to
      Offeree, which communication will (i) be reviewed by competent securities
      counsel, acceptable to Firebird, prior to being transmitted; and (ii)
      contain all disclosures, disclaimers and cautionary statements required
      under applicable securities laws for sophisticated investors or otherwise
      recommended by counsel. This communication will include all consent forms
      and other documentation that any Offeree must execute to accept the Offer
      prior to its expiration and meet any and all conditions
      precedent.

            


    

     

    
      c/o
Trident Trust Company

      (Cayman)
Limited, One Capital Place, P.O. Box 847 GT, George Town, Grand Cayman, Cayman
Islands

      Phone:
(345) 949-0880, Fax: (345) 949-0881

       

    

    
      
         


      

      
         


        
          

        

      

      
         


      

    

     

    
      Firebird
Global Master Fund, Ltd. 

       

    

    
      	
               
      

            	
              h.

            	
                    AVAX
      will make members of Senior Management available to Firebird prior to the
      closing to answer any questions regarding any matter germane to Firebird's
      investment decision.

            


    

    
      	
               
      

            	
              i.

            	
                    Firebird
      shall be granted the right to appoint two designees to AVAX's Board of
      Directors or at its option up to two Board
  Observers.

            


    

    
      	
               
      

            	
              j.

            	
                    AVAX
      will collect all consent and other forms needed to effect the Initial
      Funding and the exercise of any applicable warrants the Offerees wish to
      exercise, and transmit to Firebird all consent forms and any other
      required documentation from all Offerees by 9:00 am EDT on Monday,
      November 1, 2010.

            


    

    
      	
               
      

            	
              k.

            	
                    Firebird
      shall be satisfied that all securities that it believes have not yet been
      duly delivered to Firebird in respect of any and all prior financings
      shall have been duly delivered, in form and substance satisfactory to
      Firebird, prior to the expiration of this
Offer.

            


    

    
      	
               
      

            	
              5.

            	
                 Prior
      to any Subsequent Funding, the following conditions precedent must be met,
      if not waived by Firebird:

            


    

    
      	 	
              a. 

            	
              AVAX
      shall have responded to any and all information requests of
      Firebird;

            


    

    
      	 	
              b. 

            	
              AVAX
      will make members of Senior Management available to Firebird prior to
      the
      closing to answer any questions regarding any matter germane to Firebird's
      Investment
      decision.

            


    

    
      	
               
      

            	
              c.

            	
              The
      Senior Officers and Directors of AVAX shall execute and provide Firebird a
      written and signed communication whereby they make representations about
      information provided to Firebird, their due diligence Investigations and
      other material disclosures (and lack of material omissions in such
      disclosures) that is similar to that requested in Paragraph 4e
      above.

            


    

    


    Upon the
acceptance of this offer by all of the Offerees, Firebird will forfeit its
24,000,000 warrants that it holds with respect to its participation in the 2007
offering.

    


    Please acknowledge the intention of
your Board to immediately present this Offer to the Offerees and to take such
actions to facilitate their ability to accept this Offer prior to its expiration
by executing and returning a copy of this letter to me by Thursday, October
28, 2010 by 5:00 pm. EDT
via overnight courier, an email (ipassin@fbird.com) or facsimile
(212-698-9266).

    


    Sincerely,

    


    FIREBIRD
GLOBAL MASTER FUND

    


    /s/ James
Passin

    James
Passin

    Director

     

    
      c/o
Trident Trust Company

      (Cayman)
Limited, One Capital Place, P.O. Box 847 GT, George Town, Grand Cayman, Cayman
Islands

      Phone:
(345) 949-0880, Fax: (345) 949-0881

    

     

    
      
         


      

      
         


        
          

        

      

      
         


      

    

     

    
      Firebird
Global Master Fund, Ltd.

       

    

    
      
        	
                Acknowledged
      and Accepted:

              
	
                AVAX
      TECHNOLOGIES, INC.

              
	 
      
	
                /s/
      John Prendergast

              
	
                John
      Prendergast

              
	
                Chief
      Executive Officer and Executive
Chairman

              


      

    

     

    
      c/o
Trident Trust Company

      (Cayman)
Limited, One Capital Place, P.O. Box 847 GT, George Town, Grand Cayman, Cayman
Islands

      Phone:
(345) 949-0880, Fax: (345) 949-0881