UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
| x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
| For the quarterly period ended September 30, 2014 |
or
| o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
| For the transition period from to |
Commission File Number 000-26875
VG LIFE SCIENCES INC.
(Exact name of registrant as specified in its charter)
| Delaware | 33-0814123 |
|
(State or other jurisdiction of incorporation or organization) |
(I.R.S Employer Identification No.) |
121 Gray Avenue, Suite 200
Santa Barbara, CA 93101
(Address of principal executive offices) (Zip Code)
(805) 879-9000
Registrant’s telephone number, including area code
Indicate by checkmark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes o No x
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.
| Large Accelerated Filer o | Accelerated Filer o |
| Non-Accelerated Filer o | Smaller Reporting Company x |
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x
As of October 15, 2014, the number of shares outstanding of the registrant’s common stock, $0.0001 par value, was 31,815,628.
VG LIFE SCIENCES INC.
Index
| Page | |
| PART I — FINANCIAL INFORMATION | 3 |
| Item 1. Unaudited Financial Statements | 3 |
| Consolidated Balance Sheets as of September 30, 2014 (Unaudited) and December 31, 2013 | 3 |
| Consolidated Statements of Operations, Three and Nine Months Ended September 30, 2014 and 2013 (Unaudited) | 4 |
| Consolidated Statements of Cash Flows, Nine Months Ended September 30, 2014 and 2013 (Unaudited) | 5 |
| Notes to Consolidated Financial Statements, Nine Months Ended September 30, 2014 and 2013 (Unaudited) | 7 |
| Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations | 11 |
| Item 3. Quantitative and Qualitative Disclosures About Market Risk | 21 |
| Item 4. Controls and Procedures | 21 |
| PART II — OTHER INFORMATION | 21 |
| Item 1. Legal Proceedings | 21 |
| Item 1A. Risk Factors | 21 |
| Item 2. Unregistered Sales of Equity Securities and Use of Proceeds | 21 |
| Item 3. Defaults Upon Senior Securities | 23 |
| Item 4. Mine Safety Disclosures (Not applicable.) | 23 |
| Item 5. Other Information | 23 |
| Item 6. Exhibits | 24 |
| 2 |
PART I — FINANCIAL INFORMATION
| Item 1. | Financial Statements |
VG LIFE SCIENCES INC. AND SUBSIDIARIES
(A Development Stage Company)
CONSOLIDATED BALANCE SHEETS
(Unaudited)
| September 30, 2014 | December 31, 2013 | |||||||
| (Audited) | ||||||||
| ASSETS | ||||||||
| CURRENT ASSETS | ||||||||
| Cash | $ | 53,842 | $ | 713,892 | ||||
| Prepaid expenses and other current assets | 6,621 | 75,494 | ||||||
| Total Current Assets | 60,463 | 789,386 | ||||||
| PROPERTY AND EQUIPMENT, NET | – | – | ||||||
| OTHER ASSETS | ||||||||
| Intangible assets | 1,076,836 | 1,076,836 | ||||||
| TOTAL ASSETS | $ | 1,137,299 | $ | 1,866,222 | ||||
| LIABILITIES AND STOCKHOLDERS' DEFICIT | ||||||||
| CURRENT LIABILITIES | ||||||||
| Accounts payable | $ | 866,146 | $ | 405,000 | ||||
| Accrued expenses | 182,730 | 434,471 | ||||||
| Accrued interest | 265,001 | 69,898 | ||||||
| Insurance finance agreement | – | 33,836 | ||||||
| Convertible debt - related parties | 2,599,689 | 1,844,732 | ||||||
| Convertible debt - other | 1,098,360 | 1,363,272 | ||||||
| Derivative liabilities | 1,295,487 | 2,183,440 | ||||||
| Total Current Liabilities | 6,307,413 | 6,334,649 | ||||||
| COMMITMENTS AND CONTINGENCIES | ||||||||
| STOCKHOLDERS' DEFICIT | ||||||||
| Preferred stock, 20,000,000 shares authorized, $0.0001 par value; 9,715,443 and 9,715,443 issued and outstanding, respectively | 972 | 972 | ||||||
| Common stock, 150,000,000 shares authorized, $0.0001 par value; 31,230,318 and 17,459,752 issued and outstanding, respectively | 3,123 | 1,746 | ||||||
| Additional paid-in capital | 99,696,993 | 94,609,247 | ||||||
| Noncontrolling interests | 673,115 | 698,921 | ||||||
| Deficit accumulated during the development stage | (105,544,317 | ) | (99,779,313 | ) | ||||
| Total Stockholders' Deficit | (5,170,114 | ) | (4,468,427 | ) | ||||
| TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT | $ | 1,137,299 | $ | 1,866,222 | ||||
See accompanying notes to unaudited interim consolidated financial statements.
| 3 |
VG LIFE SCIENCES, INC. AND SUBSIDIARIES
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
| Three Months Ended September 30, | Nine Months Ended September 30, | July 11, 1995 (Inception) to September 30, | ||||||||||||||||||
| 2014 | 2013 | 2014 | 2013 | 2014 | ||||||||||||||||
| REVENUES | $ | – | $ | – | $ | – | $ | – | $ | 347,750 | ||||||||||
| EXPENSES | ||||||||||||||||||||
| Research and development | 339,881 | 300,196 | 975,864 | 349,636 | 18,964,648 | |||||||||||||||
| Management salaries | 214,376 | 259,425 | 780,625 | 489,307 | 6,657,399 | |||||||||||||||
| Depreciation and amortization | – | – | – | – | 1,645,748 | |||||||||||||||
| Legal and professional | 179,878 | 190,723 | 1,077,551 | 696,586 | 8,402,688 | |||||||||||||||
| Consulting fees | – | 50,415 | 37,629 | 152,915 | 19,561,051 | |||||||||||||||
| General and administrative | 64,637 | 52,873 | 730,502 | 84,649 | 10,439,268 | |||||||||||||||
| Total expenses | 798,772 | 853,632 | 3,602,171 | 1,773,093 | 65,670,802 | |||||||||||||||
| LOSS FROM OPERATIONS | (798,772 | ) | (853,632 | ) | (3,602,171 | ) | (1,773,093 | ) | (65,323,052 | ) | ||||||||||
| OTHER INCOME (EXPENSE) | ||||||||||||||||||||
| Asset impairment | – | – | – | – | (475,000 | ) | ||||||||||||||
| Sale of distribution rights | – | – | – | – | 1,309,966 | |||||||||||||||
| Interest income | – | – | – | – | 9,392 | |||||||||||||||
| Derivative benefit/(expense) | 414,895 | (633,000 | ) | (94,935 | ) | (2,098,134 | ) | (5,043,766 | ) | |||||||||||
| Interest expense | (687,800 | ) | (71,672 | ) | (2,093,704 | ) | (502,875 | ) | (36,269,992 | ) | ||||||||||
| Total other income (expense) | (272,905 | ) | (704,672 | ) | (2,188,639 | ) | (2,601,009 | ) | (40,469,400 | ) | ||||||||||
| NET LOSS | (1,071,677 | ) | (1,558,304 | ) | (5,790,810 | ) | (4,374,102 | ) | (105,792,452 | ) | ||||||||||
| NET LOSS ATTRIBUTABLE TO NONCONTROLLING INTERESTS | 8,602 | 9,297 | 25,806 | 31,703 | 248,135 | |||||||||||||||
| NET LOSS ATTRIBUTABLE TO COMMON SHAREHOLDERS | $ | (1,063,075 | ) | $ | (1,549,007 | ) | $ | (5,765,004 | ) | $ | (4,342,399 | ) | $ | (105,544,317 | ) | |||||
| NET LOSS PER COMMON SHARE, BASIC AND DILUTED | $ | (0.04 | ) | $ | (0.18 | ) | $ | (0.24 | ) | $ | (0.68 | ) | ||||||||
| WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING, BASIC AND DILUTED | 28,935,882 | 8,403,425 | 23,986,056 | 6,354,005 | ||||||||||||||||
See accompanying notes to unaudited interim consolidated financial statements.
| 4 |
VG LIFE SCIENCES, INC. AND SUBSIDIARIES
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
| Nine Months Ended | Cumulative for the Period July 11, 1995 (Inception) to | |||||||||||
| September 30, | September 30, | |||||||||||
| 2014 | 2013 | 2014 | ||||||||||
| Cash Flows From Operating Activities: | ||||||||||||
| Net loss attributable to controlling interests | $ | (5,765,004 | ) | $ | (4,342,399 | ) | $ | (105,544,317 | ) | |||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||||||
| Depreciation | – | – | 1,645,748 | |||||||||
| Amortization of debt discount | 1,878,116 | 74,472 | 9,265,943 | |||||||||
| Debt Issuance costs | – | – | 13,339,211 | |||||||||
| Imputed Interest | – | 63,300 | 189,826 | |||||||||
| Non-Controlling Interest | (25,806 | ) | (31,703 | ) | (248,135 | ) | ||||||
| Services included in accounts payable to be satisfied in shares | – | – | 200,000 | |||||||||
| Issuance of common stock and warrants for services | 54,756 | – | 677,006 | |||||||||
| Stock based compensation | – | – | 1,890,449 | |||||||||
| Issuance of common stock for services and finders fee | – | – | 7,864,423 | |||||||||
| Issuance of convertible notes for services | 1,001,565 | 627,277 | 2,495,575 | |||||||||
| Beneficial conversion feature | – | – | 71,500 | |||||||||
| Issuance of preferred stock for interest | – | – | 225,000 | |||||||||
| Settlement-distribution agreement rights | – | – | 1,668,953 | |||||||||
| Debt Settlement liabilities and common shares in excess of recorded liabilities | – | – | 399,530 | |||||||||
| Issuance of stock and warrants for interest and financing costs | – | – | 7,730,776 | |||||||||
| Non-cash operating expenses and other charges | – | – | 5,387,663 | |||||||||
| Non-cash income-gain on settlements | – | – | (384,966 | ) | ||||||||
| Options and warrants issued for services and wages | 597,269 | 347,600 | 13,243,795 | |||||||||
| Options exercised for services | – | – | 116,317 | |||||||||
| Contingently issued stock issued for services | – | – | 792,499 | |||||||||
| Warrants exercised for services | – | – | 12,500 | |||||||||
| Issuance of common stock for expenses paid by third party | – | – | 593,947 | |||||||||
| Issuance of common stock for settlement agreement | – | – | 1,060,000 | |||||||||
| Notes payable issued for expenses | – | – | 897,306 | |||||||||
| Notes payable converted to accrued wages | – | – | (25,000 | ) | ||||||||
| Satisfaction of Syexia-in excess of accrual | – | – | 104,577 | |||||||||
| Change in variable common stock purchase options | – | – | (22,418 | ) | ||||||||
| (Increase) decrease in prepaid expenses and other current assets | 68,873 | – | (97,941 | ) | ||||||||
| (Increase) decrease in deposits and other assets | – | – | 1,972,832 | |||||||||
| Increase (decrease) in accrued interest | 195,102 | 49,103 | 1,486,762 | |||||||||
| Increase (decrease) in accounts payable | 461,144 | 199,838 | 1,778,853 | |||||||||
| Increase (decrease) in accrued expenses | (62,997 | ) | 416,206 | 2,594,291 | ||||||||
| Increase (decrease) in accrued wages payable | – | – | 771,744 | |||||||||
| Increase (decrease) in advances-related parties | – | – | 74,283 | |||||||||
| Increase (decrease) in advances | – | – | 136,000 | |||||||||
| Increase (decrease) in insurance finance agreement | – | – | 33,836 | |||||||||
| Increase (decrease) in convertible debt-related parties and other | – | – | (112,475 | ) | ||||||||
| Increase (decrease) in derivative liability | 94,935 | 2,098,134 | 4,802,935 | |||||||||
| Net cash used in operating activities | (1,502,047 | ) | (498,172 | ) | (22,911,172 | ) | ||||||
| Cash Flows From Investing Activities: | ||||||||||||
| Increase in leasehold improvements | – | – | (1,039,306 | ) | ||||||||
| Acquisition of equipment | – | – | (361,665 | ) | ||||||||
| Increase in intangible assets | – | – | (5,206,051 | ) | ||||||||
| Net cash used in investing activities | – | – | (6,607,022 | ) | ||||||||
(continued)
| 5 |
| Nine Months Ended | Cumulative for the Period July 11, 1995 (Inception) to | |||||||||||
| September 30, | September 30, | |||||||||||
| 2014 | 2013 | 2014 | ||||||||||
| Cash Flows From Financing Activates: | ||||||||||||
| Proceeds of MedBridge Debt | – | – | 125,000 | |||||||||
| Proceeds from convertible debt-related party and other | 875,833 | 628,002 | 7,482,433 | |||||||||
| Payment for convertible debt-related party and other | (33,836 | ) | (121,038 | ) | (930,603 | ) | ||||||
| Proceeds from sale of common stock and warrants, net | – | – | 11,082,204 | |||||||||
| Proceeds from Revolving line of credit-related party | – | – | 3,087,432 | |||||||||
| Repayments of Revolving line of credit-related party | – | – | (1,694,162 | ) | ||||||||
| Proceeds of sale of VGE securities to third parties, net | – | – | 600,000 | |||||||||
| Proceeds from notes payable | – | – | 267,000 | |||||||||
| Proceeds from exercise of options and warrants | – | 173,061 | ||||||||||
| Proceeds from notes payable--related parties | – | – | 9,379,671 | |||||||||
| Net cash provided by financing activities | 841,997 | 506,964 | 29,572,036 | |||||||||
| Increase (decrease) in Cash | (660,050 | ) | 8,792 | 53,842 | ||||||||
| Cash and cash equivalents, beginning of period | 713,892 | 6,090 | – | |||||||||
| Cash and cash equivalents, end of period | $ | 53,842 | $ | 14,882 | $ | 53,842 | ||||||
| SUPPLEMENT DISCLOSURE OF CASH FLOW INFORMATION | ||||||||||||
| Cash paid during the period for: | ||||||||||||
| Interest | $ | – | $ | – | $ | – | ||||||
| Income taxes | $ | – | $ | – | $ | – | ||||||
| NON-CASH TRANSACTIONS | ||||||||||||
| Issuance of common stock and warrants for convertible notes and interest | $ | – | $ | – | $ | 6,072,377 | ||||||
| Discount on indebtedness | $ | 1,807,205 | $ | 330,472 | $ | 10,472,155 | ||||||
| Reclassification of derivative liability to additional paid-in-capital | $ | – | $ | – | $ | 1,264,800 | ||||||
| Conversion of various accruals to convertible notes | $ | – | $ | – | $ | 1,953,954 | ||||||
| Issuance of common stock in satisfaction of accounts payable/notes/accruals | $ | 1,645,439 | $ | 532,500 | $ | 5,432,742 | ||||||
| Refinancing of convertible debt -related party Revolving line of credit | $ | – | $ | – | $ | 3,180,393 | ||||||
| Issuance of common shares in various debt settlements and partial satisfactions | $ | – | $ | – | $ | 629,451 | ||||||
| Issuance of unsecured convertible debentures for accounts payable | $ | – | $ | – | $ | 476,866 | ||||||
| Issuance of common stock for debt repayment-DMBM/Wonderland, net | $ | – | $ | – | $ | 35,214 | ||||||
| Noncontrolling interest, net | $ | – | $ | – | $ | 2,447 | ||||||
| Issuance of common stock for T & T legal and accrued interest | $ | – | $ | – | $ | 1,035,000 | ||||||
| Issuance of convertible note to acquire interest in unconsolidated subsidiary | $ | – | $ | – | $ | 782,814 | ||||||
| Issuance of common shares, options and warrants- V Clip acquisition | $ | – | $ | – | $ | 1,502,479 | ||||||
| Issuance of common shares - repurchase product royalty rights, China Market | $ | – | $ | – | $ | 231,000 | ||||||
| Issuance of common shares and warrants - Carcinotek acquisition | $ | – | $ | – | $ | 1,000,000 | ||||||
| Restructuring of convertible debentures | $ | – | $ | – | $ | 1,198,167 | ||||||
| Issuance (settlement) of unsecured convertible debentures - patents | $ | – | $ | – | $ | 248,000 | ||||||
| Issuance of common stock for debt paid by third party | $ | – | $ | – | $ | 593,947 | ||||||
| Issuance of common stock for debt and interest | $ | – | $ | – | $ | 9,086,511 | ||||||
| Issuance of common stock finders fee | $ | – | $ | – | $ | 450,000 | ||||||
| Warrants issued with convertible debentures and amendment of arrangement | $ | – | $ | – | $ | 516,800 | ||||||
| Transfer from derivative liabilities | $ | 984,455 | $ | 798,048 | $ | 2,988,878 | ||||||
| Issuance of warrant in partial consideration of notes payable | $ | – | $ | – | $ | 100,000 | ||||||
| Issuance of note in consideration of White Label acquisitions | $ | – | $ | – | $ | 100,000 | ||||||
| Issue Series A Preferred Stock for secured revolving credit note | $ | – | $ | – | $ | 252,000 | ||||||
See accompanying notes to unaudited interim consolidated financial statements.
| 6 |
VG LIFE SCIENCES INC. AND SUBSIDIARIES
(A DEVELOPMENT STAGE COMPANY)
Notes to Consolidated Financial Statements
Nine Months Ended September 30, 2014 and 2013
(Unaudited)
NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS
VG Life Sciences Inc. (the “Company” or “VGLS”) was incorporated in California on July 11, 1995 and is in the development stage. The Company is engaged in research and development of therapeutic and diagnostic pharmaceutical and medical products. The Company was acquired by a publicly traded Delaware Corporation and became a reporting issuer on October 1, 2001. On November 5, 2001, this publicly traded company changed its name to Viral Genetics, Inc. On November 26, 2012, the Company’s name was changed to VG Life Sciences Inc. from Viral Genetics, Inc. The Company terminated registration with the SEC on March 24, 2009. The Company became a reporting issuer again on August 22, 2014. The Company’s fiscal year-end is December 31.
As of September 30, 2014, the Company has the following subsidiaries:
Subsidiary Name | Origination/ | Ownership Percentage | ||
| V-Clip Pharmaceuticals | 2008 | 100% | ||
| Carcinotek, Inc. | 2008 | 100% | ||
| White Label Generics, Inc. | 2008 | 49% | ||
| MetaCytolytics, Inc. | 2009 | 100% | ||
| Viral Genetics Beijing, Ltd. | 2009 | 100% | ||
| VG Energy, Inc. (“VGE”) | 2010 | 81.65% |
The various subsidiaries were organized or acquired to facilitate the use of the Company’s Targeted Peptide Technology (“TPT”) and Metabolic Disruption Technology (“MDT”). As of September 30, 2014 and December 31, 2013, all subsidiaries were inactive.
NOTE 2 - BASIS OF PRESENTATION
The accompanying unaudited interim consolidated financial statements as of September 30, 2014 and for the three and nine month periods ended September 30, 2014 and 2013 have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and on the same basis as the audited annual consolidated financial statements. The unaudited interim consolidated balance sheet as of September 30, 2014, unaudited interim consolidated statements of operations for the three and nine month periods ended September 30, 2014 and 2013, and the unaudited interim consolidated statements of cash flows for the nine month periods ended September 30, 2014 and 2013 include all material adjustments, consisting only of normal recurring adjustments (unless otherwise discussed below), which management considered necessary for a fair presentation of the financial position and operating results for the periods presented. These unaudited financial statements are the representations of management. The results for the three and nine month periods ended September 30, 2014 are not necessarily indicative of results to be expected for the year ending December 31, 2014 or for any future interim period. The audited consolidated balance sheet at December 31, 2013 has been derived from the audited consolidated financial statements; however, the notes to the accompanying unaudited consolidated financial statements do not include all of the information and notes required by accounting principles generally accepted in the United States of America for complete consolidated financial statements. The accompanying unaudited consolidated interim financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto for the year ended December 31, 2013 included in Amendment # 2 of the Company’s Form 10 filed with the Securities and Exchange Commission on October 1, 2014. These accompanying notes are generally limited to the information necessary to update the information included in the aforementioned financial statements for the year ended December 31, 2013.
| 7 |
Going Concern
As of September 30, 2014, the Company had a deficit accumulated during the development stage of approximately $105.5 million and requires substantial additional funds to continue its research and development, to support its operations and to achieve its business development goals, the attainment of which are not assured. The Company has been able to satisfy certain liabilities with convertible indebtedness and common shares and enter into debt settlement arrangements, facilitated by third party financing, with vendors and creditors for substantial amounts of its various financial obligations. Convertible instruments have also been converted into equity. In September 2013, the Company also entered into arrangements with related parties under which it has and will continue to receive certain financial and administrative support and services through March 18, 2015 and has consummated related party and unrelated convertible debenture and warrant agreements from which it will receive cash and executive services (from related parties only). However, substantial indebtedness remains and substantial recurring losses from operations and additional liabilities continue to be incurred.
These factors and uncertainties raise substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classification of liabilities that might incur in the event the Company cannot continue in existence. Management has designed plans for sales of the Company’s future pharmaceutical related products. Management intends to seek additional capital from new equity securities offerings, from debt financing and debt restructuring to provide funds needed to increase liquidity, fund internal growth and fully implement its business plan. However, management can give no assurance that these funds will be available in adequate amounts, or if available, on terms that would be satisfactory to the Company.
The timing and amount of the Company’s capital requirements will depend on a number of factors, including the need for funds to support research and development and payment requirements to sustain licensing rights, demand for products and services and the availability of opportunities for international expansion through affiliations, to maintain its status as a public company, shareholder and investor relations, to establish and maintain current and new business relationships and for other general corporate business purposes.
NOTE 3 – CONVERTIBLE DEBT – OTHER
On January 24, 2014, KED Consulting Group LLC, (“KED”) entered into a Convertible Promissory Note and Warrant Purchase Agreement with the Company in the amount of $270,000. The notes are unsecured, bear interest at 8% per annum, and are convertible into common shares at $0.0588 per share. KED also received warrants to purchase 1,080,000 shares at $0.45 per share on execution of this agreement, exercisable at any time from the four year anniversary to the fifth year anniversary of this arrangement. Shares will be issuable on conversion of these notes in total in four equal tranches (25% each) on the following dates: December 15, 2014, March 15, 2015, June 15, 2015 and September 15, 2015, to the extent not earlier converted, at the conversion price per share ($0.0588). All proceeds were received by September 30, 2014. Of the $270,000: $100,000 was to be paid directly in satisfaction of a vendor liability of ours, which has been paid, and $170,000 was to be paid in cash in six equal monthly payments of $28,333. The final payment was received on September 30, 2014. Debt discount of $270,000 was recorded of which $58,704 and $130,508 was amortized as interest expense in the three and nine month periods ended September 30, 2014, respectively.
Effective March 1, 2014, investors in unsecured convertible debentures aggregating a total of $165,000 exchanged these debentures and any associated warrants (waiving any defaults and accrued interest on the notes) for an equal principal amount under a Convertible Promissory Notes and Warrants Purchase Agreement with the same terms and conditions as described in the preceding paragraph. These investors received warrants to purchase an aggregate of 660,000 common shares, with the same terms and conditions as described preceding paragraph. Debt discount of $165,000 was recorded of which $70,620 and $92,740 was amortized as interest expense in the three and nine month periods ended September 30, 2014, respectively.
Effective August 27, 2014, the Company received proceeds of $50,000 from an unrelated investor, pursuant to a Convertible Promissory Note and Warrant Purchase Agreement under terms and conditions that are the same as those described in Note 4, except that this note is due on August 22, 2016 and this investor has the right to purchase notes totaling $150,000 through August 21, 2015. Principal and accrued interest are convertible in four equal quarterly tranches of principal, plus accrued interest commencing on November 22, 2015, or at any time at the investor’s option, at the conversion price. Debt discount of $50,000 was recorded of which $3,064 was amortized as interest expense in the nine month period ended September 30, 2014.
| 8 |
NOTE 4 – CONVERTIBLE DEBT – RELATED PARTIES
In the nine month period ended September 30, 2014, the Company entered into Convertible Promissory Notes (“Notes”) and Warrant Purchase Agreements with three related party entities: on July 9, 2014 with Wild Harp Holdings, LLC (“Wild Harp”) controlled by John Tynan, our CEO, and DW Odell Company (“DW Odell”) controlled by David Odell, our CFO, and on August 27, 2014, with Medbridge Development Company, LLC (“MDC”), an entity controlled by Mr. Tynan and Mr. Odell. John Tynan and David Odell are officers and directors of the Company. The Wild Harp and DW Odell agreements provide for Notes of up to $250,000 each to be purchased at the option of each party through July 9, 2015, of which $150,000 has been received from each of Wild Harp and DW Odell through September 30, 2014. The MDC agreement provides for a Note of $50,000, proceeds of which were received from MDC on August 27, 2014. All three Notes bear interest at 8% per annum and have a two year term. Principal and accrued interest are convertible in four equal quarterly tranches of principal, plus accrued interest commencing 15 months after the issuance date of each Note, or at any time at each party’s option, at the conversion price. The Wild Harp and DW Odell balances are each comprised of two Notes having identical conversion provisions; (i) a Note with $100,000 in principal with a conversion rate of $0.1245 and warrant exercise price of $0.93 per share and (ii) a Note with $50,000 in principal with a conversion rate of $0.084 and warrant exercise price of $0.63 per share. The MDC Note of $50,000 has a conversion price of $0.1134 and a warrant exercise price of $0.85 per share. The warrants received by the parties are to purchase four common shares for each $1 of principal, an aggregate of 1,400,000 shares as of September 30, 2014, exercisable on any date from the four-year anniversary to the five-year anniversary of the agreement. Similar warrants will be issued with future Wild Harp and DW Odell note proceeds of up to $200,000, if any; exercisable at 7.5 times the corresponding conversion price. All warrants include a cashless exercise provision. These Notes issued through September 30, 2014, are convertible into 3,237,819 shares of common stock of the Company.
NOTE 5 – EQUITY INCENTIVE PLAN
In the three and nine month periods ended September 30, 2014, the Company granted 1,515,000, and 4,545,000, respectively, non-qualified stock options under its 2013 Equity Incentive Plan to management and consultants. The fair value of these options was estimated using the Black-Scholes Option Pricing Model with the following assumptions: risk free annual interest ranging from 2.52% to 2.73%; volatility approximating 127%; expected life of 5 years; and no expected dividends. The aggregate fair value of these options granted for the nine months ended September 30, 2014 of $597,269 was included in research and development in the amount of $59,136 and general and administrative expense in the amount of $538,133.
NOTE 6 – COMMON AND PREFERRED STOCK
Effective on July 9, 2014, the Company filed a certificate of amendment to its Delaware Certificate of Incorporation increasing the total number of authorized shares of capital stock to 170,000,000 from 160,000,000. The total number of authorized Preferred Shares was increased to 20,000,000 from 10,000,000 and authorized Common Shares remained at 150,000,000; each having a par value of $0.0001 per share. Also on July 9, 2014, the Company established a Series B Preferred Stock ("Series B"), which the Company removed through an Amendment and Restatement of the Articles of Incorporation on September 4, 2014 and an Amended and Restated Certificate of Designation on September 4, 2014.
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NOTE 7 – SUBSEQUENT EVENTS
On March 28, 2014, the Company entered into an Investment Agreement (“the Agreement”) with Dutchess Opportunity Fund II L.P. (“Dutchess”) whereby Dutchess may purchase up to that number of common shares having an aggregate purchase price of $5,000,000. Under terms of the Agreement, the Company may, at its sole discretion, deliver a Put Notice to Dutchess stating the dollar amount of common shares, which the Company intends to sell to Dutchess on a closing date. The maximum amount that Dutchess can be required to purchase at any one time shall be equal to (1) 200% of the average daily volume for the three trading days immediately preceding the formal date of the notice to Dutchess or (2) $150,000, determined at the sole discretion of the Company. The share purchase price is 94% of the lowest daily volume-weighted average price of Company stock for the 5 consecutive trading days beginning with the notice date and the ensuing four trading days. The Agreement is for a term of three years from the date of execution, or, if earlier, the sale of $5,000,000 or written notice to Dutchess by the Company. On September 4, 2014, the Company and Dutchess amended the agreement to require the Company to file a Registration Statement on Form S-1 (or other appropriate form) with the SEC covering any registrable securities that may be issued under the Investment Agreement within 30 days of the completion of the review of the Form 10 by the SEC. The Company was notified by the SEC of the completion of the SEC’s review on October 14, 2014. The Company must initially register for resale up to 10,000,000 shares of common stock, except to the extent that the SEC requires the share amount to be reduced as a condition of effectiveness.
On October 27, 2014, the Company received an additional $100,000 in proceeds from Wild Harp and DW Odell pursuant to the arrangements described in Note 4.
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Item 2.
Management’s Discussion and Analysis of Financial Condition and Results of Operations
The following discussion and analysis of our financial condition and results of operation should be read in conjunction with the consolidated financial statements and notes to those statements included elsewhere in this Quarterly Report on Form 10-Q as of September 30, 2014 and our audited consolidated financial statements for the year ended December 31, 2013, included in our Registration Statement on Form 10-12G, filed with the Securities and Exchange Commission on October 1, 2014.
This report contains forward-looking statements as defined under the federal securities laws. All statements other than statements of historical facts included in this report regarding our financial performance, business strategy and plans and objectives of management for future operations and any other future events are forward-looking statements and based on our beliefs and assumptions. Words such as “may,” “will,” “expect,” “might,” “believe,” “anticipate,” “intend,” “could,” “estimate,” “project,” “plan,” and other similar words are one way to identify such forward-looking statements. Actual results could vary materially from these forward-looking statements. Such statements reflect our current view with respect to future events and are subject to certain risks, uncertainties, and assumptions including, without limitation, those risks and uncertainties contained in the Risk Factors section of the Registration Statement on Form 10-12G. Although we believe that our expectations are reasonable, we can give no assurance that such expectations will prove to be correct. Based upon changing conditions, any one or more of these events described herein as anticipated, believed, estimated, expected or intended may not occur. All prior and subsequent written and oral forward-looking statements attributable to our Company or persons acting on our behalf are expressly qualified in their entirety by this cautionary statement. We do not intend to update any of the forward-looking statements after the date of this report to conform these statements to actual results or to changes in our expectations, except as required by law.
Business Overview
We are a drug discovery and development company researching two core technologies: Targeted Peptide Technology, or TPT, which is currently our main focus, and Metabolic Disruption Technology, or MDT, which is our secondary focus. We have one drug research program in clinical stage, a MDT therapy, which helps, in combination, with other drugs to fight cancers with solid tumors in situations where the cancer is resistant to the initial cancer drug therapy. Our MDT trials were initially for ovarian cancer, but have since expanded to include other solid tumors, including those located in the breast, colon, liver, lung, and pancreas. Additionally, we have one drug research program in pre-clinical stages, a TPT therapy for HIV/AIDS using VG1177, our computationally designed peptide. This TPT therapy requires significant additional work before the commencement of clinical trials, including favorable animal toxicity study results and then regulatory review and approval of protocols, as well as additional financing.
Our research and development programs are based on technology that Dr. M. Karen Newell Rogers developed while working at the University of Colorado, the University of Vermont, and Texas A&M University. We hold the exclusive license to this technology. We have also collaborated with a multitude of scientists and clinicians at universities throughout the country, including Stanford University, Harvard University, and the Scott & White Healthcare Center, where we test TPT in inflammatory disease applications in which we believe TPT could have a benefit.
Plan of Operation
Current Studies
Physician’s IND Phase I study
Our Physician’s Investigational New Drug, or P-IND, Phase I clinical trial on late-stage patients with solid tumors is entering its fourth cohort with maximum dosing, and we are completing the analysis of the results of those trials. This trial is designed to assess the safety of a combination treatment using hydroxychloroquine, or HCQ, and a cancer drug sorafenib, which is currently marketed as NexavarTM. The combination treatment is designed to disrupt the metabolism of the cancer cells, making them more prone to the effects of sorafenib. To date, patients in the P-IND Phase I trial have not experienced unacceptable levels of toxicity. On March 14, 2014, we reported two clinical responses in cohort 3 with disease stabilization in a patient with four months of disease stabilization in a patient with metastatic ovarian cancer, which has spread throughout portions of the body, and five months of disease stabilization in a patient with triple-negative breast cancer, which is a type of cancer that does not express three genes that are key to traditional cancer treatment, making treatment more difficult. The final patient in cohort number 3 has stage IV, or metastatic, adenocarcinoma of the lung, which is a common form of lung cancer, and has four separate lung lesions. During the course of the study, the four lesions have all regressed about 20% in size. We hold the use patent for this combination treatment.
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This study, funded in part by a grant of $1.5 million to the Scott and White Foundation, is being conducted at the Cancer Therapy and Research Center at the University of Texas Health Sciences Center at the San Antonio Institute for Drug Development, or CTRC, and Scott and White Hospital, or S&W, in Temple, Texas, under primary investigator, Dr. Tyler Curiel. The study is being carried out by physicians and scientists at the CTRC, with the close involvement of Dr. M. Karen Newell Rogers and a liaison employed by the Company to coordinate administration and communication. Also, the Institutional Review Board of the University of Texas Health Science Center San Antonio has approved further study to include all solid tumors, which include breast, colon, lung, liver, pancreatic, and other types of cancers.
VG1177
In October 2013, we contracted ITR Canada, Inc. to conduct IND-enabling animal safety studies with our patented peptide VG1177. We now expect these studies to conclude in early 2015. These animal safety studies are the next important step to move toward clinical trials.
Plans
With the completion of the P-IND Phase I study with the combination treatment for solid carcinomas, we anticipate a Phase II trial, though we presently do not have the funds to pursue this further development.
We have authorized and funded an animal study to develop our proprietary peptide VG1177, a series of studies that we believe will be complete in early 2015, and assuming adequate funding, we intend to initiate a Phase I study using an injectable form of VG1177 thereafter.
Results of Operations
Critical Accounting Policies and Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make judgments and estimates.
We believe the following critical accounting policies affect our more significant judgments and estimates used in preparation of our financial statements.
Cash and Cash Equivalents
For purposes of the statement of cash flows, we consider all highly liquid investments with original maturities of three months or less to be cash equivalents.
Impaired Asset Policy
We follow generally accepted accounting policies related to accounting for the impairment of long-lived assets. Long-lived assets are measured at the lower of carrying amount or fair value less cost to sell, whether reported in continuing operations or discontinued operation.
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Research and Development
We charge research and development expenses to operations as incurred.
Use of Estimates
The process of preparing financial statements in conformity with accounting principles generally accepted in the United States of America requires the use of estimates and assumptions regarding certain types of assets, liabilities, revenues and expenses. Such estimates primarily relate to unsettled transactions and events as of the date of the financial statements. Accordingly, upon settlement, actual results may differ from estimated amounts.
Basic and Diluted Net Loss Per Share
We compute loss per share in accordance with generally accepted accounting principles, which requires presentation of both basic and diluted earnings per share on the face of the statement of operations. Basic loss per share is computed by dividing net loss available to common shareholders by the weighted average number of outstanding common shares during the period. The treasury stock method is used to determine the dilutive effects of stock options and warrants. Dilutive loss per share is equal to the basic loss per share for the three and nine month periods ended September 30, 2014 and 2013 because common stock equivalents would have been anti-dilutive.
Fair Value of Financial Instruments
Fair value is defined as the price that would be received upon sale of an asset or paid upon transfer of a liability in an orderly transaction between market participants at the measurement date and in the principal or most advantageous market for that asset or liability. We calculate fair value based on assumptions that market participants use in pricing the asset or liability, not on assumptions specific to our Company.
We measure the fair value based on whether values are observable in the market.
These levels are:
Level 1 – inputs are based upon unadjusted quoted prices for identical instruments traded in active markets.
Level 2 – inputs are based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
Level 3 – inputs are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques that include option pricing models, discounted cash flow models, and similar techniques.
Our financial instruments consist of: cash, notes payable, accounts payable, accrued expenses, and accrued interest, convertible notes payable and various forms of convertible indebtedness. The carrying value of these financial instruments approximates their fair value based on their liquidity, their short-term nature or application of appropriate risk based discount rates to determine fair value. These financial assets and liabilities are valued using level 2 inputs, except for cash, which is at level 1.
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Stock-Based Compensation
We record stock-based compensation by using the fair value method. All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable. Equity instruments issued to employees and the cost of the services received as consideration are measured and recognized based on the fair value of the equity instruments issued.
Concentration of Credit Risk
We have financial instruments that are exposed to concentrations of credit risk and consist primarily of cash. We maintain cash at certain financial institutions and, from time to time, these amounts are substantially in excess of Federal Deposit Insurance Corporation, or FDIC, insurance limits. We believe that these financial institutions are of high quality and the risk of loss is minimal. At December 31, 2013, we had cash balances in excess of FDIC limits of approximately $500,000.
Comparison of Fiscal Periods Ended September 30, 2014 and September 30, 2013
| Nine Months Ended September 30, | ||||||||||||||||||||||||
| 2014 | 2013 | |||||||||||||||||||||||
| EXPENSES: | Total | Non- Cash | All other | Total | Non- Cash | All other | ||||||||||||||||||
| Research and development | $ | 975,864 | $ | 82,199 | $ | 893,665 | $ | 349,636 | $ | 4,500 | $ | 345,136 | ||||||||||||
| Management salaries and fees | 780,625 | – | 780,625 | 489,307 | 3,900 | 485,407 | ||||||||||||||||||
| Legal and professional | 1,077,551 | 142,944 | 934,607 | 696,586 | – | 696,586 | ||||||||||||||||||
| Consulting fees | 37,629 | 4,500 | 33,129 | 152,915 | 800 | 152,115 | ||||||||||||||||||
| General and administrative | 730,502 | 538,393 | 192,109 | 84,649 | – | 84,649 | ||||||||||||||||||
| Total operating expenses | $ | 3,602,171 | $ | 768,036 | $ | 2,834,135 | $ | 1,773,093 | $ | 9,200 | $ | 1,763,893 | ||||||||||||
| Derivative (benefit) expense | $ | 94,935 | $ | 94,935 | $ | – | $ | 2,098,134 | $ | 2,098,134 | $ | – | ||||||||||||
| Interest expense | $ | 2,093,704 | $ | 2,093,704 | $ | – | $ | 502,875 | $ | 502,875 | $ | – | ||||||||||||
| Three Months Ended September 30, | ||||||||||||||||||||||||
| 2014 | 2013 | |||||||||||||||||||||||
| EXPENSES: | Total | Non- Cash | All other | Total | Non- Cash | All other | ||||||||||||||||||
| Research and development | $ | 339,881 | $ | 26,552 | $ | 313,329 | $ | 300,196 | $ | 1,500 | $ | 298,696 | ||||||||||||
| Management salaries and fees | 214,376 | – | 214,376 | 259,425 | 1,300 | 258,125 | ||||||||||||||||||
| Legal and professional | 179,878 | 11,913 | 167,965 | 190,723 | – | 190,723 | ||||||||||||||||||
| Consulting fees | – | – | – | 50,415 | – | 50,415 | ||||||||||||||||||
| General and administrative | 64,637 | 3,560 | 61,077 | 52,873 | – | 52,873 | ||||||||||||||||||
| Total operating expenses | $ | 798,772 | $ | 42,025 | $ | 756,747 | $ | 853,632 | $ | 2,800 | $ | 850,832 | ||||||||||||
| Derivative (benefit) expense | $ | (414,895 | ) | $ | (414,895 | ) | $ | – | $ | 633,000 | $ | 633,000 | $ | – | ||||||||||
| Interest expense | $ | 687,800 | $ | 687,800 | $ | – | $ | 71,672 | $ | 71,672 | $ | – | ||||||||||||
Certain employee salaries and consulting fees are not paid in cash as incurred under the respective agreements, but are evidenced by unsecured convertible non-interest bearing notes due December 31, 2015. The holder may convert any amount of these notes prior to maturity at a 20% discount from the 20 day VWAP on the conversion date. All notes that remain outstanding on maturity are automatically convertible into common shares at a 20% discount from the 20 day VWAP upon maturity.
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Revenue
We have not generated any revenue from product sales or royalties from product sales to date. We do not expect to earn revenues until we have received FDA approval to market our products, if that occurs.
Research and Development
Research and development expenses increased by 179% to $975,864 in the nine month period ended September 30, 2014 as compared to $349,636 in the same period in 2013. We incurred $526,181 in the nine months ended September 30, 2014 as compared to $122,738 in the same period in 2013 with respect to new testing being conducted for us by ITR Canada, under which payments began in the fourth quarter of 2013. Other expenditures consisted principally of compensation to consultants and advisors assisting in development of our licensed science. Also included were reimbursement of certain expenses related to the development of our licensed patents by the University of Texas, including fees for Dr. Newell’s services pursuant to a funding agreement with Dr. M. Karen Newell, Scott & White, a non-profit organization, and us. Non-cash expenses consisted of the fair value of common stock purchase options which was $59,136 in 2014 as compared to $4,500 in 2013. The increase is attributable to options granted and vested in the nine months ended September 30, 2014 pursuant to our 2013 Equity Incentive Plan adopted by our Board of Directors and approved by shareholders in December 2013.
General and Administrative Expenses
General and administrative expenses increased by 763% to $730,502 in the nine month period ended September 30, 2014 from $84,649 in the same period in 2013. In 2014 we incurred a non-cash charge of $538,133 in stock based compensation for the fair value of common stock options granted in the nine months ended September 30, 2014 pursuant to the 2013 Equity Incentive Plan as compared to $0 in 2013.
Interest Expense and Interest Income
Interest expense increased by 316% to $2,093,704 in the nine month period ended September 30, 2014 from $502,875 in the same period of 2013 or an increase of $1,590,829. The current period includes amortization of the debt discount associated with the valuation of warrants granted in connection with financing transactions of convertible debenture and warrants. Interest expense incurred is substantially all non-cash.
Derivative Expense
Derivative expense decreased by 95% to $94,935 for the nine months ended September 30, 2014 as compared to $2,098,134 for the comparable period of 2013. Derivative expense, a non-cash charge, consists principally of the fair valuation of certain discounts from market price of conversion features and the period to period changes in these amounts. These 2013 and 2014 amounts were principally attributable to amended and restated convertible promissory notes, modifications with DMBM and with respect to other transactions related to satisfactions of liabilities in shares, and in 2014, recognition of debt discount on financing transactions as financing costs.
Management Salaries
Management salaries, including fees, increased by 60% to $780,625 in the nine month period ended September 30, 2014 from $489,307 in the comparable period of 2013. This increase was largely due to $180,000 in fees for services incurred ($129,000 in 2013) in connection with the MedBridge Development Company, or MDC arrangement, and $381,250 ($125,000) in the three months ended September 30, 2013, inception of agreement) in executive services funded by the MedBridge Venture Fund financing, both of which originated after the 2013 first quarter.
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Legal and Professional Fees
Legal and professional fees increased by 55% to $1,077,551 in the nine month period ended September 30, 2014 from $696,586 in the same period of 2013 or an increase of $380,965. This was principally due to increased legal, accounting and auditor fees related to our preparation and filing with the SEC of our Form 10, partially offset by a reduction in counsel fees incurred in registering patents and licenses of our licensed sciences with the SEC. Audit fees were $425,734 in the nine months ended September 30, 2014 as compared to $0 in the comparable period of the preceding year. Accounting consulting services of $238,834 (including stock based compensation) were incurred for the nine months ended September 30, 2014 as compared to $67,200 in the preceding period. Services in 2013 related to (i) intellectual property (ii) domestic and international patent protection filings regarding licensed technologies and (iii) OTC Markets filings and status, as well as other normal corporate legal matters. In the nine month period ended September 30, 2014, audit fees incurred in connection with audit procedures related to the Form 10 were substantially higher than fees incurred in the comparable period of the preceding year. Non-cash expense, included above, in 2014 in the amount of $142,944 related to the issuance of common stock for certain accounting services to a consultant and for legal fees.
Consulting Fees
Consulting fees decreased by 75% to $37,629 in the nine month period ended September 30, 2014 from $152,915 in the comparable period of 2013 or a decrease of $115,286, principally due to decreases for services related to investor relations and other expenses.
Net Loss
Our net loss attributable to common shareholders for the nine month period ended September 30, 2014 was $5,765,004 as compared to $4,342,399 for the comparable period of 2013. Operating expenses increased by 103% to $3,602,171 in the 2014 period as compared to $1,773,093 for the comparable period of 2013. Aggregate non-cash expenses incurred in the nine months ended September 30, 2014 approximated $2,834,000 as compared to $2,579,000 in the comparable period of 2013, an increase of $255,000.
Liquidity and Capital Resources
We reported a net loss attributable to common shareholders of $5,765,004 for the nine months ended September 30, 2014. At September 30, 2014, our accumulated deficit amounted to $105,544,317. In the future, we may raise additional capital from external sources in order to continue the longer term efforts contemplated under our business plan. We expect to continue incurring losses for the foreseeable future and may need to raise additional capital to pursue our product development initiatives, to penetrate markets for the sale of our products and continue as a going concern. We cannot provide any assurances that we will be able to raise additional capital. Our management believes that we have access to capital resources through possible public or private equity offerings, debt financings, corporate collaborations or other means, if needed; however, we can provide no assurance that new financing will be available on commercially acceptable terms, if needed.
Sources of Liquidity
As of September 30, 2014, we had cash and cash equivalents of $53,842. Those funds have since been utilized. Subsequent to September 30, 2014, we received $100,000 from related parties as described in our unaudited financial statements included elsewhere herein. Since our inception, substantially all of our operations have been financed through sales of equity securities and various loans. The following are financing transactions pursuant to which we have received proceeds in the nine months ended September 30, 2014, or pursuant to which we may be contractually entitled to receive additional proceeds.
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DMBM, Inc.
On July 1, 2013, DMBM, Inc. and the Company executed a Release and Settlement Agreement (“R & S”) modifying the conversion price of convertible debentures aggregating $135,000 issued or to be issued by the Company to JTL Enterprises Corp. (“JTL”) and acquired by DMBM. These debentures were given in partial consideration of services rendered by JTL for the period from January 2012 to June 30, 2013 (a total of $118,750) and thereafter (in the amount of $16,250). On April 1, 2012 we issued a convertible debenture to JTL for $54,750. On December 31, 2012, we issued a convertible debenture to JTL for $19,000. On June 30, 2013, we issued a convertible debenture to JTL for $21,000. On August 1, 2013, DMBM and JTL entered into note purchase agreements for these three convertible debentures, dated April 1, 2012, December 31, 2012 and June 30, 2013 for a series of cash payments made to JTL aggregating $94,750. On December 1, 2013, we issued a convertible debenture to JTL for $24,000. On December 1, 2013, DMBM and JTL entered into note purchase agreement for a cash payment made to JTL of $24,000. On December 31, 2013, we issued a convertible debenture to JTL for $11,250. On December 31, 2013, DMBM and JTL entered into note purchase agreement for a cash payment made to JTL of $11,250. On January 31, 2014, we issued a convertible debenture to JTL for $5,000. On January 1, 2014, DMBM and JTL entered into note purchase agreement for a cash payment made to JTL of $5,000. Through September 30, 2014 DMBM has made $121,500 in payments and is delinquent in its payment obligation for the remaining balance of $13,500. JTL has the right to demand that we make payments pursuant to the terms of the original notes. We have not received such demand. The R & S provides that in order to retire the debt we issue shares of common stock at the lower of $0.05 per share or at a discount of 30% from the average of the closing price for the 14 trading days prior to the date of conversion of the JTL notes acquired by DMBM. On September 11, 2014, DMBM submitted a notice of conversion to us pertaining to the above mentioned note purchase agreements and converted $68,000 outstanding principal balance and received 1,360,000 common shares at $0.05 per share.
On September 15, 2013, we entered into a convertible promissory note and warrant purchase agreement with DMBM pursuant to which, through September 30, 2014, DMBM funded $220,000 in exchange for a convertible note, due September 15, 2015, with an interest at the rate of 8% per annum. Of the proceeds, $86,667 was received in 2013, and $133,333 was received in the nine month period ended September 30, 2014. DMBM received a warrant to purchase 880,000 shares of our common stock at $0.45 per share, exercisable for the period from the fourth year anniversary to the fifth year anniversary from the date of the agreement. The warrant includes a cashless exercise feature.
KED Consulting Group
On January 24, 2014, we entered into a convertible promissory note and warrant purchase agreement with KED Consulting Group, pursuant to which KED Consulting Group is obligated to provide $270,000 in funding at a rate of 8% interest per annum; $100,000 was paid directly in satisfaction of a Company vendor liability and $170,000 was paid to us in installments through September 30, 2014. KED Consulting Group received warrants to purchase 1,080,000 shares of common stock at $0.45 per share, upon execution of this agreement. The warrant is exercisable, in whole or in part, on or after the fourth anniversary of the issue date and up to the and including the fifth anniversary. The warrant includes a cashless exercise feature.
Other Financing Agreements
In March 2014, individuals holding $115,000 in convertible notes entered into convertible promissory notes at a rate of 8% interest per annum and warrant purchase agreements replacing their original notes with us, waiving accrued interest and any other defaults that may have existed as of that date. These individuals also received warrants to purchase 460,000 shares of common stock on execution of this agreement. We also received an additional $50,000 from another investor in the 2014 period under similar terms.
On August 22, 2014, we entered into a convertible promissory note and warrant purchase agreement with an individual, Hock Tiam Tay, an unrelated party, pursuant to which we received $50,000 in cash. In exchange, we issued a convertible promissory note with a principal amount of $50,000 and a warrant to purchase 200,000 shares of our common stock. The note has an annual interest rate of 8% and is convertible at the option of the holder in four equal tranches on November 22, 2015, February 22, 2016, May 22, 2016 and August 22, 2016. The conversion price is $0.113 per share. The warrant has an exercise price of $0.85 per share and shall be exercisable from August 22, 2018 until August 22, 2019. The warrant has a cashless exercise feature.
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Dutchess Opportunity Fund II, L.P.
On March 28, 2014, we entered into an Investment Agreement with Dutchess Opportunity Fund II L.P., whereby Dutchess Opportunity Fund may purchase up to that number of common shares having an aggregate purchase price of $5,000,000. Under terms of the agreement, we may, at our sole discretion, deliver a put notice to Dutchess Opportunity Fund stating the dollar amount of common shares which we intend to sell to Dutchess Opportunity Fund on a closing date. The maximum amount that Dutchess Opportunity Fund can be required to purchase at any one time shall be equal to (1) 200% of the average daily volume for the three trading days immediately preceding the formal date of the notice to Dutchess Opportunity Fund or (2) $150,000, determined at our sole discretion. The share purchase price is 94% of the lowest daily volume-weighted average price of our stock for the five consecutive trading days beginning with the notice date and the ensuing four trading days. The agreement is for a term of three years from the date of execution, or, if earlier, the sale of $5,000,000 or written notice to Dutchess Opportunity Fund by us. On September 4, 2014, we amended the agreement to require us to file a Registration Statement on Form S-1 (or other appropriate form) with the SEC covering and registering securities that may be issued under the agreement within 30 days of the completion of the review of the Form 10 by the SEC. We were notified by the SEC of the completion of the SEC’s review on October 14, 2014. We must initially register for resale up to 10,000,000 shares of common stock. This agreement will be effective on December 13, 2014, which is 60 days after the SEC completed its review of our Form 10 on October 14, 2014.
Related Party Financings
MedBridge Development Company
Effective March 18, 2013, we entered into a Strategic Collaboration Agreement, or SCA, with MedBridge Development Company, LLC, or MDC, pursuant to which MDC is providing funding and services to fund continuing research and development and operations and providing administrative assistance to us through March 31, 2015. Services valued at $20,000 per month, subject to adjustment, during the term are to be provided, as well as a line of credit providing $12,500 per month during the term. In the nine month period ended September 30, 2014, $180,000 in services and $112,500 in cash proceeds have been received. At September 30, 2014, $62,500 remains to be received in monthly proceeds, and an additional $200,000 at the discretion of MDC. MDC has conversion rights within thirty days of the end of each quarter during the term of the agreement. MDC is owned 42.66% by the Tynan Family Trust, of which our CEO and director, John Tynan is the trustee; 42.66% by our CFO and director, David Odell; 4.87% by EDK, LLC, which is managed by Edward Koke; 7.31% by West Beach Investments, LLC, which is managed by Steven Schott; and 2.5% by Ruth Loomer, an individual.
On August 27, 2014, we entered into a convertible promissory note and warrant purchase agreement with MDC, pursuant to which MDC provided us with $50,000 in cash. In exchange, we issued MDC a convertible promissory note with a principal amount of $50,000 and a warrant to purchase 200,000 shares of our common stock. The note has an annual interest rate of 8% and is convertible at the option of the holder in four equal tranches on November 27, 2015, February 27, 2016, May 27, 2016 and August 27, 2016. The conversion price is $0.113 per share. The warrant has an exercise price of $0.85 per share and shall be exercisable from August 27, 2018 until August 27, 2019. The warrant has a cashless exercise feature.
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MedBridge Venture Fund, LLC
Effective on July 13, 2013, we entered into a Convertible Promissory Note and Warrant Purchase Agreement with MedBridge Venture Fund, LLC, or MVF, pursuant to which MVF agreed to purchase a minimum of $250,000 and a maximum of $2,500,000 in convertible notes and warrants to purchase up to 10,000,000 common shares if all proceeds are received. The notes are convertible at $.0588 per common share, or a maximum of 42,517,000 shares if all proceeds are received. The notes bear interest at 8% per annum and mature September 15, 2015, and to the extent not converted prior to maturity, the outstanding amount of the notes and accrued interest will automatically be converted into common stock at a defined conversion price. However, in the event that we are in default at maturity, the balance due under the note would be payable in cash.
Through October 15, 2014, we have received $2,206,250 consisting of cash proceeds of $1,450,000 from MVF, $100,000 from an unrelated investor, and management services valued at $656,250 in exchange for which we issued convertible notes and warrants to MVF to purchase 8,425,000 common shares. Additional notes for monthly services to be provided by MVF from October 1, 2014 to January 12, 2015 valued by the parties at $78,750 and warrants to purchase an additional 315,000 shares of common stock, at a monthly rate stipulated in the agreement, are to be provided. The services to be provided by MVF include a management team with a President and CEO, Chief Operating Officer, Controller, grant application coordinator, finance administrative assistant and public relations resources. Through October 15, 2014, MVF converted $120,000 in principal at a defined conversion price of $0.0588 per share and received 2,040,817 common shares. If not earlier converted at MVF’s option, common shares will be issuable on conversion of these notes in total in four equal tranches (25% each) on the following dates: December 15, 2014, March 15, 2015, June 15, 2015 and September 15, 2015. The warrants to purchase our common shares are exercisable at $0.45 per share, but not before 48 months and not after 60 months after the date of issuance. The warrants include a cashless exercise feature. MVF is co-managed by Wild Harp Holdings, LLC, which is 100% owned by our CEO and director, John Tynan, and DW Odell Company, LLC, which is 100% owned by our CFO and director, David Odell.
At September 30, 2014, we are also obligated to issue convertible notes to an unrelated party for proceeds received in the amount of $50,000 and warrants to purchase 200,000 common shares, under the same terms and conditions as the preceding transactions with MVF. This amount would be convertible into 850,340 common shares.
Best Investment Trust
On October 1, 2013, we entered into an unsecured note with Best Investment Trust, or BIT, formerly known as Best Investments, Inc., in the amount of $993,023, with interest at 5% per annum, due December 31, 2018. As a result of conversions to common stock, this balance was reduced to $63,952 on September 30, 2014. In addition, we issued an identical note in the amount of $63,375 to another individual who participated in the arrangement with BIT, which was converted into 292,808 common shares by the holder on March 3, 2014. This note was issued as a replacement and amendment of the secured revolving line of credit dated March 5, 2008 and subsequently assigned to BIT. All or any portion of the principal balance and accrued interest may be exchanged for Units, each unit consisting of one share of common stock and one warrant to purchase one share of voting common stock, at any time. In the nine month period ended September 30, 2014, an aggregate of $513,376 in principal was converted into 2,441,792 common shares and warrants to purchase an equal number of shares at 1.5 times the conversion prices. If not converted earlier, unpaid principal of $63,952 at September 30, 2014, plus accrued interest, due at maturity shall automatically be exchanged for Units based upon the exchange price upon maturity. BIT is controlled by Haig Keledjian, our Chairman of the Board, Vice President of Research and Development and Secretary.
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Wild Harp Holdings, LLC
On July 9, 2014, we entered into a Convertible Promissory Note and Warrant Purchase Agreement with Wild Harp Holdings, LLC, pursuant to which Wild Harp Holdings is obligated to provide us with a minimum of $100,000 and a maximum of $250,000 to be received no later than July 9, 2015. On July 9, 2014, we received the minimum $100,000 and, in exchange, issued Wild Harp Holdings a convertible promissory note in the amount of $100,000 with an 8% interest rate per annum and a warrant to purchase 400,000 shares of common stock at an exercise price of $0.93 per share that may be exercised at any time from July 9, 2018 to July 9, 2019. The warrants have a cashless exercise provision. The note shall be convertible at the option of Wild Harp Holdings in four equal tranches on October 9, 2015, January 9, 2016, April 9, 2016 and July 9, 2016. The defined conversion price is $0.1245 per share. If the remaining principal and interest due under the note is not paid by July 9, 2016, the maturity date, then the remaining amount shall automatically be converted into shares of common stock using the same conversion ratio above.
On September 16, 2014, we received an additional $50,000 from Wild Harp Holdings, LLC and issued Wild Harp Holdings a convertible promissory note in the amount of $50,000 with an 8% interest rate per annum and a warrant to purchase 200,000 shares of common stock at an exercise price of $0.63 per share that may be exercised from September 16, 2018 to September 18, 2019. The note and warrant have the same terms and conditions as the ones we issued in July 2014, except that the defined conversion price of the note shall be $0.084.
On October 27, 2014, we received an additional $50,000 from Wild Harp Holdings, LLC and issued Wild Harp Holdings a convertible promissory note in the amount of $50,000 with an 8% interest rate per annum and a warrant to purchase 200,000 shares of common stock at an exercise price of $0.49 per share that may be exercised from October 27, 2018 to October 26, 2019. The note and warrant have the same terms and conditions as the ones we issued in July 2014, except that the defined conversion price of the note shall be $0.065.
DW Odell Company, LLC
On July 9, 2014, we entered into a Convertible Promissory Note and Warrant Purchase Agreement with DW Odell, LLC, pursuant to which DW Odell is obligated to provide us with a minimum of $100,000 and a maximum of $250,000 to be received no later than July 9, 2015. On July 9, 2014, we received the minimum $100,000 and, in exchange, issued DW Odell a convertible promissory note in the amount of $100,000 with an 8% interest rate per annum and a warrant to purchase 400,000 shares of common stock at an exercise price of $0.93 per share that may be exercised at any time from July 9, 2018 to July 9, 2019. The warrants have a cashless exercise provision. The note shall be convertible at the option of DW Odell in four equal tranches on October 9, 2015, January 9, 2016, April 9, 2016 and July 9, 2016. The defined conversion price is $0.1245 per share. If the remaining principal and interest due under the note is not paid by July 9, 2016, the maturity date, then the remaining amount shall automatically be converted into shares of common stock using the same conversion ratio above.
On September 16, 2014, we received an additional $50,000 from DW Odell Company, LLC and issued DW Odell Company a convertible promissory note in the amount of $50,000 with an 8% interest rate per annum and a warrant to purchase 200,000 shares of common stock at an exercise price of $0.63 per share that may be exercised from September 16, 2018 to September 18, 2019. The note and warrant have the same terms and conditions as the ones we issued in July 2014, except that the defined conversion price of the note shall be $0.084.
On October 27, 2014, we received an additional $50,000 from DW Odell Company, LLC and issued DW Odell Company a convertible promissory note in the amount of $50,000 with an 8% interest rate per annum and a warrant to purchase 200,000 shares of common stock at an exercise price of $0.49 per share that may be exercised from October 27, 2018 to October 26, 2019. The note and warrant have the same terms and conditions as the ones we issued in July 2014, except that the defined conversion price of the note shall be $0.065.
Off-Balance Sheet Transactions
We currently have no off-balance sheet arrangements that have or are reasonably likely to have a current or future material effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.
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| Item 3. | Quantitative and Qualitative Disclosures About Market Risk |
As a smaller reporting company, we are electing scaled disclosure reporting obligations and therefore are not required to provide the information required by this Item.
| Item 4. | Controls and Procedures |
(a) Evaluation of Disclosure Controls and Procedures. We maintain “disclosure controls and procedures,” as such term is defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, or the Exchange Act, that are designed to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in Securities and Exchange Commission rules and forms, and that such information is accumulated and communicated to our management, including our CEO and CFO, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating our disclosure controls and procedures, our management recognized that disclosure controls and procedures, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the disclosure controls and procedures are met. Accordingly, our disclosure controls and procedures have been designed to meet reasonable assurance standards. Additionally, in designing disclosure controls and procedures, our management was necessarily required to apply its judgment in evaluating the cost-benefit relationship of possible disclosure controls and procedures. The design of any disclosure controls and procedures is also based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.
Under the supervision and with the participation of our management, including our CEO and CFO, we have evaluated the effectiveness of our disclosure controls and procedures as required by Exchange Act Rule 13a-15(b) as of the end of the period covered by this report. Based on that evaluation, our CEO and CFO have concluded that these disclosure controls and procedures are effective at the reasonable assurance level for the quarter ended September 30, 2014.
(b) Changes in Internal Controls. There were no changes in our internal control over financial reporting that occurred during the quarter ended September 30, 2014 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
PART II — OTHER INFORMATION
| Item 1. | Legal Proceedings |
On occasion, we may be involved in legal matters arising in the ordinary course of our business including matters involving proprietary technology. While management believes that such matters are currently insignificant, matters arising in the ordinary course of business for which we are or could become involved in litigation may have a material adverse effect on our business, financial condition or results of comprehensive loss.
| Item 1A. | Risk Factors |
There have been no material changes from risk factors previously disclosed in our Registration Statement on Form 10, as filed with the SEC on October 1, 2014.
| Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds |
On January 1, 2014, we entered into a Services Agreement with JTL Enterprises Corp. for accounting services. On March 21, 2014, we issued 289,000 shares of common stock valued at $0.0588 per share to JTL Enterprises Corp. for partial consideration of services rendered January 1, 2014 to January 31, 2014. On April 16, 2014, we issued 335,000 shares valued at $0.0588 per share to JTL Enterprises Corp. for partial consideration of services rendered February 1, 2014 to February 28, 2014. On May 27, 2014, we issued 420,000 shares valued at $0.0588 per share to JTL Enterprises Corp. for partial consideration of services rendered April 1, 2014 to April 30, 2014. On May 28, 2014, we issued 241,000 shares valued at $0.0588 per share to JTL Enterprises Corp. for partial consideration of services rendered March 1, 2014 to March 30, 2014. On July 14, 2014, we issued 331,000 shares valued at $0.0588 per share to JTL Enterprises Corp. for partial consideration of services rendered May 1, 2014 to May 31, 2014. On August 8, 2014, we issued 106,000 shares valued at $0.0588 per share to JTL Enterprises Corp. for partial consideration of services rendered June 1, 2014 to June 30, 2014. On August 20, 2014, we issued 173,000 shares valued at $0.0588 per share to JTL Enterprises Corp. for partial consideration of services rendered July 1, 2014 to July 31, 2014. On October 3, 2014, we issued 135,000 shares valued at $0.0588 per share to JTL Enterprises Corp. for partial consideration of services rendered August 1, 2014 to August 31, 2014.
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On March 3, 2014, we issued 2,481 shares of common stock valued at $12.00121 per share to Robert A Forrester for legal services rendered in October 2011.
On July 9, 2014, we entered into a Convertible Promissory Note and Warrant Purchase Agreement with Wild Harp Holdings, LLC, pursuant to which Wild Harp Holdings is obligated to provide us with a minimum of $100,000 and a maximum of $250,000 to be received no later than July 9, 2015. On July 9, 2014, we received the minimum $100,000 and, in exchange, issued Wild Harp Holdings a convertible promissory note in the amount of $100,000 with an 8% interest rate per annum and a warrant to purchase 400,000 shares of common stock at an exercise price of $0.93 per share that may be exercised at any time from July 9, 2018 to July 9, 2019. The warrants have a cashless exercise provision. The note shall be convertible at the option of Wild Harp Holdings in four equal tranches on October 9, 2015, January 9, 2016, April 9, 2016 and July 9, 2016. The defined conversion price is $0.1245 per share. If the remaining principal and interest due under the note is not paid by July 9, 2016, the maturity date, then the remaining amount shall automatically be converted into shares of common stock using the same conversion ratio above. In addition, we agreed to issue 50,000 shares of our Series B Preferred Stock to Wild Harp Holdings. John Tynan, our CEO, owns 100% of Wild Harp Holdings.
On July 9, 2014, we entered into a Convertible Promissory Note and Warrant Purchase Agreement with DW Odell, LLC, pursuant to which DW Odell is obligated to provide us with a minimum of $100,000 and a maximum of $250,000 to be received no later than July 9, 2015. On July 9, 2014, we received the minimum $100,000 and, in exchange, issued DW Odell a convertible promissory note in the amount of $100,000 with an 8% interest rate per annum and a warrant to purchase 400,000 shares of common stock at an exercise price of $0.93 per share that may be exercised at any time from July 9, 2018 to July 9, 2019. The warrants have a cashless exercise provision. The note shall be convertible at the option of DW Odell in four equal tranches on October 9, 2015, January 9, 2016, April 9, 2016 and July 9, 2016. The defined conversion price is $0.1245 per share. If the remaining principal and interest due under the note is not paid by July 9, 2016, the maturity date, then the remaining amount shall automatically be converted into shares of common stock using the same conversion ratio above. In addition, we agreed to issue 50,000 shares of our Series B Preferred Stock to DW Odell. David Odell, our CFO and director, owns 100% of DW Odell.
On July 19, 2014, we entered into the First Amendment to the Convertible Promissory Note and Warrant Purchase Agreement with Wild Harp Holdings in order to remove all references to Series B Preferred Shares and removing the agreement to issue 50,000 shares of our Series B Preferred Stock. All other terms and conditions of the Convertible Promissory Note and Warrant Purchase Agreement remain unmodified and in full force and effect.
On July 19, 2014, we entered into the First Amendment to the Convertible Promissory Note and Warrant Purchase Agreement with DW Odell Company in order to remove all references to Series B Preferred Shares and removing the agreement to issue 50,000 shares of our Series B Preferred Stock. All other terms and conditions of the Convertible Promissory Note and Warrant Purchase Agreement remain unmodified and in full force and effect.
On August 27, 2014, we entered into a convertible promissory note and warrant purchase agreement with MDC, pursuant to which MDC provided us $50,000 in cash. In exchange, we issued MDC a convertible promissory note with a principal amount of $50,000 and a warrant to purchase 200,000 shares of our common stock. The note has an annual interest rate of 8% and is convertible at the option of the holder in four equal tranches on November 27, 2015, February 27, 2016, May 27, 2016 and August 27, 2016. The conversion price is $0.113 per share. The warrant has an exercise price of $0.85 per share and shall be exercisable from August 27, 2018 until August 27, 2019. The warrant has a cashless exercise feature.
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On September 16, 2014, we received an additional $50,000 from Wild Harp Holdings, LLC and issued Wild Harp Holdings a convertible promissory note in the amount of $50,000 with an 8% interest rate per annum and a warrant to purchase 200,000 shares of common stock at an exercise price of $0.63 per share that may be exercised from September 16, 2018 to September 18, 2019. The note and warrant have the same terms and conditions as the ones we issued in July 2014, except that the defined conversion price of the note shall be $0.084.
On September 16, 2014, we received an additional $50,000 from DW Odell Company, LLC and issued DW Odell Company a convertible promissory note in the amount of $50,000 with an 8% interest rate per annum and a warrant to purchase 200,000 shares of common stock at an exercise price of $0.63 per share that may be exercised from September 16, 2018 to September 18, 2019. The note and warrant has the same terms and conditions as the ones we issued in July 2014, except that the defined conversion price of the note shall be $0.084.
On October 27, 2014, we received an additional $50,000 from Wild Harp Holdings, LLC and issued Wild Harp Holdings a convertible promissory note in the amount of $50,000 with an 8% interest rate per annum and a warrant to purchase 200,000 shares of common stock at an exercise price of $0.49 per share that may be exercised from October 27, 2018 to October 26, 2019. The note and warrant have the same terms and conditions as the ones we issued in July 2014, except that the defined conversion price of the note shall be $0.065.
On October 27, 2014, we received an additional $50,000 from DW Odell Company, LLC and issued DW Odell Company a convertible promissory note in the amount of $50,000 with an 8% interest rate per annum and a warrant to purchase 200,000 shares of common stock at an exercise price of $0.49 per share that may be exercised from October 27, 2018 to October 26, 2019. The note and warrant have the same terms and conditions as the ones we issued in July 2014, except that the defined conversion price of the note shall be $0.065.
| Item 3. | Default Upon Senior Securities |
We did not default upon any senior securities during the quarter ended September 30, 2014.
| Item 4. | Mine Safety Disclosures |
Not applicable.
| Item 5. | Other Information |
Subsequent Events
On March 28, 2014, we entered into an Investment Agreement with Dutchess Opportunity Fund II L.P. whereby Dutchess may purchase up to that number of common shares having an aggregate purchase price of $5,000,000. Under terms of the agreement, we may, at our sole discretion, deliver a put notice to Dutchess stating the dollar amount of common shares, which we intend to sell to Dutchess on a closing date. The maximum amount that Dutchess can be required to purchase at any one time shall be equal to (1) 200% of the average daily volume for the three trading days immediately preceding the formal date of the notice to Dutchess or (2) $150,000, determined at our sole discretion. The share purchase price is 94% of the lowest daily volume-weighted average price of Company stock for the five consecutive trading days beginning with the notice date and the ensuing four trading days. The agreement is for a term of three years from the date of execution, or, if earlier, the sale of $5,000,000 or written notice to Dutchess by us. On September 4, 2014, we amended the agreement to require us to file a Registration Statement on Form S-1 (or other appropriate form) with the SEC covering and registering securities that may be issued under the agreement within 30 days of the completion of the review of the Form 10 by the SEC. We were notified by the SEC of the completion of the SEC’s review on October 14, 2014. We must initially register for resale up to 10,000,000 shares of common stock. This agreement will be effective on December 13, 2014, which is 60 days after the SEC completed its review of our Form 10 on October 14, 2014.
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On October 27, 2014, we received an additional $50,000 from Wild Harp Holdings, LLC and issued Wild Harp Holdings a convertible promissory note in the amount of $50,000 with an 8% interest rate per annum and a warrant to purchase 200,000 shares of common stock at an exercise price of $0.49 per share that may be exercised from October 27, 2018 to October 26, 2019. The note and warrant have the same terms and conditions as the ones we issued in July 2014, except that the defined conversion price of the note shall be $0.065.
On October 27, 2014, we received an additional $50,000 from DW Odell Company, LLC and issued DW Odell Company a convertible promissory note in the amount of $50,000 with an 8% interest rate per annum and a warrant to purchase 200,000 shares of common stock at an exercise price of $0.49 per share that may be exercised from October 27, 2018 to October 26, 2019. The note and warrant have the same terms and conditions as the ones we issued in July 2014, except that the defined conversion price of the note shall be $0.065.
| Item 6. | Exhibits |
| Exhibit No | Description |
| 2.1 | Agreement and Plan of Merger dated June 30, 2004, including the Agreement of Merger attached as Exhibit B (included as exhibits 2.1 and 2.2 to the 8-K filed by Viral Genetics, Inc. September 28, 2004, and incorporated herein by reference). |
| 3.1 | Certificate of Incorporation, filed June 8, 1998 (included as exhibit 3.1 to the Form 10-SB filed by Viral Genetics, Inc. on July 29, 1999, and incorporated herein by reference). |
| 3.2 | Certificate of Amendment, filed April 22, 1999 (included as exhibit 3.2 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 3.3 | Certificate of Amendment, effective November 20, 2001 (included as exhibit 3.2 to the 10-KSB field by Viral Genetics, Inc. on April 24, 2002, and incorporated herein by reference). |
| 3.4 | Certificate of Amendment, effective November 17, 2004 (included as exhibit 3.3 to the Form 10-KSB filed by Viral Genetics, Inc. on April 5, 2005, and incorporated herein by reference). |
| 3.5 | Certificate of Designation of Series A Preferred Stock, filed May 12, 2009 (included as exhibit 3.7 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 3.6 | Certificate of Amendment, filed May 13, 2009 (included as exhibit 3.8 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 3.7 | Certificate of Amendment, filed January 3, 2011 (included as exhibit 3.5 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 3.8 | Certificate of Amendment to the Certificate of Designation of Series A Preferred Stock, filed August 22, 2012 (included as exhibit 3.9 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 3.9 | Certificate of Amendment, filed October 22, 2012 (filed as Exhibit 3.9 to the Form 10-12G/A filed September 10, 2014, and incorporated herein by reference). |
| 3.1 | Certificate of Amendment, filed November 13, 2012 (included as exhibit 3.10 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 3.11 | Certificate of Amendment, filed March 18, 2014 (included as exhibit 3.11 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 3.12 | Certificate of Amendment, effective July 15, 2014 (filed as Exhibit 3.12 to the Form 10-12G/A filed September 10, 2014, and incorporated herein by reference). |
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| 3.13 | Certificate of Restatement and Integration of Articles of Incorporation, dated September 4, 2014 (filed as Exhibit 3.13 to the Form 10-12G/A filed September 10, 2014, and incorporated herein by reference). |
| 3.14 | Amended and Restated Certificate of Designation of Series A Preferred Stock, dated September 4, 2014 (filed as Exhibit 3.14 to the Form 10-12G/A filed September 10, 2014, and incorporated herein by reference). |
| 3.15 | Bylaws (included as exhibit 3.12 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.1 | Consulting Services Agreement between VG Life Sciences Inc. and Dr. Eric Rosenberg, dated July 1, 2006 (included as exhibit 10.128 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.2 | Consulting Agreement between Viral Genetics, Inc. and Anthony Freda, Jr., dated September 14, 2007 (included as exhibit 10.1 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.3 | Exclusive License Agreement by and between V-Clip Pharmaceuticals, Inc. and University License Equity Holdings Inc. (subsequently amended and restated) (included as exhibit 10.3 to the 8-K filed by Viral Genetics, Inc. on December 20, 2007, and incorporated herein by reference). |
| 10.4 | Subscription Agreement between V-Clip Pharmaceuticals, Inc. and University License Equity Holdings Inc. (included as exhibit 10.4 to the 8-K filed by Viral Genetics, Inc. on December 20, 2007, and incorporated herein by reference). |
| 10.5 | Memorandum of Understanding dated November 30, 2007 by and among Viral Genetics, Inc., V-Clip Pharmaceuticals, Inc. and University License Equity Holdings, Inc. (included as exhibit 10.5 to the 8-K filed by Viral Genetics, Inc. on December 20th, 2007, and incorporated herein by reference). |
| 10.6 | Debt Restructuring Agreement between Viral Genetics, Inc. and Best Investments, Inc. dated March 5, 2008 (included as exhibit 10.1 to the 8-K filed by Viral Genetics, Inc. on July 8th, 2008, and incorporated herein by reference). |
| 10.7 | Security Agreement between Viral Genetics, Inc. and Best Investments, Inc. dated March 5, 2008 (included as exhibit 10.2 to the 8-K filed by Viral Genetics Inc. on July 8th, 2008, and incorporated herein by reference). |
| 10.8 | Purchase Agreement between Viral Genetics, Inc. and Michael Capizzano, dated July 1, 2008 (included as exhibit 10.7 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.9 | Subsidiary Guarantee dated March 5, 2008 (included as exhibit 10.3 to the 8-K filed by Viral Genetics, Inc. on July 8th, 2008, and incorporated herein by reference). |
| 10.10 | Business Marketing Agreement between Viral Genetics, Inc. and Imperial Consulting Network, Inc., aka Performance Profiler Quarterly, effective October 1, 2008 (included as exhibit 10.9 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.11 | Agreement and Plan of Merger by and between Viral Genetics, Inc., a Delaware Corporation, V-Clip Pharmaceuticals, Inc., and Viral Genetics, Inc., a California corporation dated October 28, 2008 (included as exhibit 10.1 to the 8-K filed by Viral Genetics, Inc. on November 18, 2008, and incorporated herein by reference). |
| 10.12 | Consent and Understanding by and between Viral Genetics, Inc., a Delaware Corporation, V-Clip Pharmaceuticals, Inc., and Viral Genetics, Inc., a California corporation dated October 28, 2008 (included as exhibit 10.2 to the 8-K filed by Viral Genetics, Inc. on November 18, 2008, and incorporated herein by reference). |
| 10.13 | Extension and Amendment to Agreement between Viral Genetics, Inc. and M. Karen Newell Rogers, effective July 1, 2009 (included as exhibit 10.12 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
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| 10.14 | Exclusive License Agreement with the University of Colorado, dated August 25, 2009 (included as exhibit 10.13 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference) |
| 10.15 | Consulting Services agreement between Viral Genetics, Inc. and JTL Enterprises Corp., dated October 1, 2009 (included as exhibit 10.14 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.16 | Exclusive License Agreement with the University of Colorado, dated November 30, 2009 (included as exhibit 10.15 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.17 | Business Services Agreement between Viral Genetics, Inc. and John Michael Johnson, dated January 8, 2010 (included as exhibit 10.16 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.18 | Extension Agreement between Viral Genetics, Inc. and Eric S. Rosenberg, dated February 3, 2010 and effective June 30, 2008 (included as exhibit 10.17 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.19 | Consulting Services Extension Agreement between VG Life Sciences Inc. and Dr. Eric Rosenberg, dated February 3, 2010 (included as exhibit 10.129 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.20 | Promissory Note between Viral Genetics, Inc. and Wonderland Capital Corp., dated March 10, 2010 (included as exhibit 10.18 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.21 | Lease Agreement between Viral Genetics, Inc. and Texas Life-Sciences Collaboration Center, commencing May 1, 2010 and expiring April 30, 2013 (included as exhibit 10.19 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.22 | Subscription Agreement Between Viral Genetics, Inc. and Myron and Sandi Rosneaur, dated June 21, 2010 (included as exhibit 10.20 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.23 | Subscription Agreement between Viral Genetics, Inc. and Myron and Sandi Rosenaur, dated June 28, 2010 (included as exhibit 10.21 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.24 | Unsecured Convertible Note between Viral Genetics, Inc. and DMBM, dated July 1, 2010 (included as exhibit 10.22 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.25 | Agreement to issue securities for services - SheehanBoyce, LLC, dated August 1, 2010 (included as exhibit 10.23 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.26 | Agreement to issue securities for services - Patton Capital Corp., dated August 5, 2010 (included as exhibit 10.24 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.27 | Subscription Agreement and Warrant Agreement between VG Life Sciences Inc. and Rodney Williams, dated August 17, 2010 (included as exhibit 10.25 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.28 | Letter Agreement between Viral Genetics, Inc. and T. Joseph Natale, dated September 21, 2010 (included as exhibit 10.26 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.29 | Letter Agreement between Viral Genetics, Inc. and David Odell, dated September 21, 2010 (included as exhibit 10.27 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.30 | Settlement and Mutual Release Agreement between Viral Genetics, Inc. and Timothy & Thomas, LLC, Mr. Timothy Wright, and Mr. Thomas Little, dated October 19, 2010 (included as exhibit 10.28 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 26 |
| 10.31 | Agreement and Amendment to Convertible Debenture Issued by VG Life Sciences Inc. and held by DMBM Inc., dated February 2013 and effective October 19, 2010. (included as exhibit 10.29 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.32 | Securities Purchase Agreement between the Viral Genetics, Inc., VG Energy, Inc., and John D. Lefebvre, dated October 20, 2010 (included as exhibit 10.30 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference) |
| 10.33 | Assignment between Viral Genetics, Inc. and MetaCytoLytics, Inc., dated October 28, 2010 (included as exhibit 10.31 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.34 | Assignment between Viral Genetics, Inc. and VG Energy, Inc., dated October 28, 2010 (included as exhibit 10.32 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.35 | Release and Settlement between Viral Genetics, Inc. and Michael Capizzano, dated December 8, 2010 (included as exhibit 10.33 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.36 | Amendment to the Settlement and Mutual Release Agreement between Viral Genetics, Inc. and Timothy & Thomas, LLC, Mr. Timothy Wright, and Mr. Thomas Little, dated October 19, 2010, effective December 28 2012 (included as exhibit 10.34 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.37 | Consulting Agreement between Viral Genetics, Inc. and M. Karen Newell Rogers, effective January 1, 2011 (included as exhibit 10.35 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.38 | Consulting Agreement between Viral Genetics, Inc. and Robert Berliner, effective January 1, 2011 (included as exhibit 10.37 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.39 | Consulting Agreement between Viral Genetics, Inc. and Bastiat Consulting Ltd., effective January 1, 2011 (included as exhibit 10.37 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.40 | Consulting Agreement between Viral Genetics, Inc. and Evan Newell, effective January 1, 2011 (included as exhibit 10.38 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.41 | Consulting Agreement between Viral Genetics, Inc. and Monica Ord, effective January 1, 2011 (included as exhibit 10.39 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.42 | Employment Agreement between Viral Genetics, Inc. and Haig Keledjian, effective January 1, 2011 (included as exhibit 10.40 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.43 | Extension Agreement between Viral Genetics, Inc. and Leslie Z. Benet, effective January 1, 2011 (included as exhibit 10.41 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.44 | Consulting Agreement between VG Energy, Inc. and Robert Berliner, effective January 1, 2011 (included as exhibit 10.42 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.45 | Consulting Agreement between VG Energy, Inc. and M. Karen Newell Rogers, effective January 1, 2011 (included as exhibit 10.43 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.46 | Consulting Agreement between VG Energy, Inc. and Bastiat Consulting Ltd., effective January 1, 2011 (included as exhibit 10.44 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 27 |
| 10.47 | Consulting Agreement between VG Energy, Inc. and Monica Ord, effective January 1, 2011 (included as exhibit 10.45 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.48 | Employment Agreement between VG Energy, Inc. and Haig Keledjian, effective January 1, 2011 (included as exhibit 10.46 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.49 | Cancellation Agreement between Viral Genetics, Inc. and Imperial Consulting Network, Inc., effective January 1, 2011 (included as exhibit 10.47 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.50 | Addendum to Consulting Services agreement between Viral Genetics, Inc. and JTL Enterprises Corp., dated January 1, 2011 (included as exhibit 10.48 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.51 | Consulting Services agreement between Viral Genetics, Inc. and Martin E. Weisberg, dated January 26, 2011 (included as exhibit 10.49 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.52 | Securities Purchase Agreement between the Company, Michael Binnion, and VG Energy, Inc., dated January 27, 2011 (included as exhibit 10.50 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.53 | Purchase and Sale Agreement between Viral Genetics, Inc. and John Tynan, dated January 28, 2011 (included as exhibit 10.51 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.54 | Purchase and Sale Agreement between Viral Genetics, Inc. and David Odell, dated January 31, 2011 (included as exhibit 10.52 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.55 | Services Agreement between Viral Genetics, Inc. and Combustion Studios Inc., dated effective February 10, 2011 (included as exhibit 10.53 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.56 | Release and Settlement Agreement between Viral Genetics, Inc. and University of Vermont - DMBM, Inc., dated March 1, 2011 (included as exhibit 10.54 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.57 | Note Purchase agreement between Viral Genetics, Inc. and DMBM, Inc., dated March 10, 2011 (included as exhibit 10.55 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference) |
| 10.58 | Letter Agreement between Viral Genetics, Inc., DMBM, Inc., and Wonderland Capital Corp, dated May 25, 2011 (included as exhibit 10.56 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.59 | Release and Settlement Agreement dated April 1, 2011 (University of Colorado) - DMBM, Inc. and Viral Genetics, Inc. (included as exhibit 10.57 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.60 | Amending Agreement to agreement to issue securities for services - Patton Capital Corp., dated June 1, 2011 (included as exhibit 10.58 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.61 | Amendment to Note Purchase Agreement between Viral Genetics, Inc. and DMBM Inc., dated October 6, 2011 (included as exhibit 10.59 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.62 | Convertible Debenture between Viral Genetics, Inc. and DMBM, Inc., dated October 25, 2011 (included as exhibit 10.60 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 28 |
| 10.63 | Convertible Debenture between Viral Genetics, Inc. and DMBM, Inc., dated November 3, 2011 (included as exhibit 10.61 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.64 | Investment Advisory Services Agreement between Viral Genetics, Inc. and Research 2.0 Inc., dated December 12, 2011 (included as exhibit 10.62 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.65 | Extension and Confirmation Agreement between Viral Genetics, Inc. and Richard Gerstner, dated December 15, 2011 (included as exhibit 10.63 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.66 | Agreement to issue securities for services - Brett Mitchell, dated December 15, 2011 (included as exhibit 10.64 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.67 | Extension and Confirmation Agreement between Viral Genetics, Inc. and Marshall C. Phelps, dated December 15, 2011 (included as exhibit 10.65 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.68 | Cancellation Agreement between Viral Genetics, Inc. and Imperial Consulting Network, Inc. dated January 1, 2011 (included as exhibit 10.66 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.69 | Restated Convertible Debenture between Viral Genetics, Inc. and DMBM, Inc., dated January 27, 2012 (included as exhibit 10.67 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.70 | Extension and Conversion Agreement between Viral Genetics, Inc. and Martin Eric Weisberg, dated January 30, 2012 (included as exhibit 10.68 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.71 | Convertible Debenture between Viral Genetics, Inc. and Eric Rosenberg, dated February 1, 2012 (included as exhibit 10.69 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.72 | Extension of agreement to issue securities for services - Anthony Freda, dated February 6, 2012 (included as exhibit 10.70 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.73 | Exclusive License Agreement with Texas A&M, dated February 14, 2012 (included as exhibit 10.71 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.74 | Agreement to issue securities for services - C. Everett Koop, dated February 22, 2012 (included as exhibit 10.72 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.75 | Restated Convertible Debenture between Viral Genetics, Inc. and DMBM, Inc., dated February 28, 2012 (included as exhibit 10.74 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.76 | Subscription Agreement between Viral Genetics, Inc. and Mr. Robert Siegel, dated March 1, 2012 (included as exhibit 10.75 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.77 | Transfer Agreement between Wonderland Capital Corp and DMBM, Inc., dated March 25, 2012 (included as exhibit 10.77 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.78 | Promissory Note between Viral Genetics, Inc. and DMBM, Inc. dated March 25, 2011 (included as exhibit 10.78 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.79 | Restated Convertible Debenture between Viral Genetics, Inc. and DMBM, Inc., dated March 30, 2012 (included as exhibit 10.79 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference) |
| 29 |
| 10.80* | Convertible Debenture between VG Life Sciences Inc. and JTL Enterprises Corp., dated April 1, 2012. |
| 10.81 | Restated Convertible Debenture between Viral Genetics, Inc. and DMBM, Inc., dated April 27, 2012 (included as exhibit 10.82 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.82 | Restated Convertible Debenture between Viral Genetics, Inc. and DMBM, Inc., dated May 24, 2012 (included as exhibit 10.83 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.83 | Restated Convertible Debenture between Viral Genetics, Inc. and DMBM, Inc., dated June 30, 2012 (included as exhibit 10.84 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.84 | Convertible Debenture between Viral Genetics, Inc. and Robert Siegel, dated July 31, 2012 (included as exhibit 10.85 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.85 | Restated Convertible Debenture between Viral Genetics, Inc. and DMBM, Inc., dated July 31, 2012 (included as exhibit 10.86 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.86 | Convertible Debenture between the Viral Genetics, Inc. and Robert Siegel, dated August 11, 2012 (included as exhibit 10.87 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.87 | Subscription Agreement between Viral Genetics, Inc. and Best Investments Trust, dated August 12, 2012 (included as exhibit 10.88 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.88 | Convertible Debenture between Viral Genetics, Inc. and Ken Kopf, dated August 14, 2012 (included as exhibit 10.89 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.89 | Manufacturing Agreement between VG Energy, Inc. and Eno Research & Consulting Services, LLC, dated September 5, 2012 (included as exhibit 10.91 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.90 | Convertible Debenture between Viral Genetics, Inc. and Rod Williams, dated September 7, 2012 (included as exhibit 10.92 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference |
| 10.91 | Convertible Debenture between Viral Genetics, Inc. and David Odell, dated September 12, 2012 (included as exhibit 10.93 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.92 | Restated Convertible Debenture between Viral Genetics, Inc., and DMBM Inc., dated September 30, 2012 (included as exhibit 10.94 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.93 | Convertible Debenture between Viral Genetics, Inc. and Morales Investment Trust, dated October 1, 2012 (included as exhibit 10.95 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.94 | Convertible Debenture between Viral Genetics, Inc. and Sandra Valentine, dated October 2, 2012 (included as exhibit 10.96 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.95 | Restated Convertible Debenture between Viral Genetics, Inc., and DMBM Inc., dated October 31, 2012 (included as exhibit 10.97 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.96 | Restated Convertible Debenture between Viral Genetics, Inc., and DMBM Inc., dated November 30, 2012 (included as exhibit 10.98 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 30 |
| 10.97 | Letter Agreement between VG Life Sciences Inc. and DMBM, Inc., dated December 2, 2012 (included as exhibit 10.99 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.98 | Amended Convertible Debenture between VG Life Sciences Inc. and DMBM, Inc., dated December 13, 2012 (included as exhibit 10.100 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.99 | Restated Convertible Debenture between Viral Genetics, Inc. and DMBM, Inc., dated December 23, 2012 (included as exhibit 10.101 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.100 | Amendment between VG Life Sciences Inc. and Timothy and Thomas LLC, effective December 28, 2012 (included as exhibit 100.102 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.101 | Addendum to the Consulting Agreement between VG Life Sciences Inc. and JTL Enterprises Corp, dated December 31, 2012 (included as exhibit 10.103 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.102* | Convertible Debenture between VG Life Sciences Inc. and JTL Enterprises Corp., dated December 31, 2012. |
| 10.103 | Amended Convertible Debenture between Viral Genetics, Inc. and DMBM, Inc., effective January 1, 2013 (included as exhibit 10.104 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.104 | Bluewater Advisory Group Consulting Agreement, dated January 1, 2013 (included as exhibit 10.105 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.105 | Convertible Note between VG Life Sciences Inc. and Michael Capizzano, dated January 1, 2013 in the amount of $3,535.00 (included as exhibit 10.106 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.106 | Convertible Note between VG Life Sciences Inc. and Michael Capizzano, dated January 1, 2013 in the amount of $20,300.00 (included as exhibit 10.107 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.107 | Debenture Purchase Agreement between Timothy & Thomas, LLC and DMBM, Inc. dated February 15, 2013 (included as exhibit 10.108 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.108 | Memorandum of Understanding between VG Life Sciences Inc. and MedBridge Development, LLC, dated March 18, 2013 (included as exhibit 10.109 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.109 | Strategic Collaboration Agreement between VG Life Sciences Inc. and MedBridge Development Company, LLC, dated March 18, 2013 (included as exhibit 10.110 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.110 | Consulting Services Agreement between VG Life Sciences Inc. and JTL Enterprises Corp, dated April 16, 2013 (included as exhibit 10.111 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.111 | Strategic Alliance Agreement between VG Life Sciences Inc., VG Energy, Inc. and DAK Renewable Research related to the production of corn and subsequent oil studies, dated May 13, 2013 (included as exhibit 10.112 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.112 | Convertible Debenture between VG Life Sciences Inc. and Eric Rosenberg, dated June 20, 2013 (included as exhibit 10.113 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.113* | Convertible Debenture between VG Life Sciences Inc. and JTL Enterprises Corp., dated June 30, 2013. |
| 31 |
| 10.114 | Convertible Promissory Note and Warrant Purchase Agreement between VG Life Sciences Inc. and MedBridge Venture Fund, LLC, dated July 13, 2013 (included as exhibit 10.114 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.115 | Consulting Services Contacts between VG Life Sciences Inc. and Chrysalis Pharma Partners, LLC, dated July 17, 2013 (included as exhibit 10.127 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.116* | Release and Settlement Agreement between VG Life Sciences Inc. and DMBM, Inc., dated as of July 1, 2013. |
| 10.117 | Exclusive license agreement with Scott & White Healthcare, dated July 18, 2013 (included as exhibit 10.115 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.118 | Consulting Agreement between VG Life Sciences Inc. and Richard Tobin, dated August 1, 2013 (included as exhibit 10.128 to the Form 10-12G/A filed September 10, 2014, and incorporated herein by reference). |
| 10.119 | Securities issued upon conversion of debt - Rodney Williams, dated August 25, 2013 (included as exhibit 10.116 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.120 | Convertible Promissory Note and Warrant Purchase Agreement between VG Life Sciences Inc. and DMBM, Inc., dated September 15, 2013 (included as exhibit 10.117 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.121 | Note Purchase Agreement between Eric Rosenberg and Stephen B. Schott, dated September 30, 2013, for the Convertible Debenture between Viral Genetics Inc. and Eric Rosenberg, dated February 1, 2012 (included as exhibit 10.118 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.122 | Note Purchase Agreement between Eric Rosenberg and Stephen B. Schott, dated September 30, 2013, for the Convertible Debenture between Viral Genetics, Inc. and Eric Rosenberg, dated June 20, 2013 (included as exhibit 10.119 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.123 | Restatement and Amendment of Unsecured Note with Best Investment Trust, dated October 1, 2013 (included as exhibit 10.120 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.124 | Five year 5% convertible note in the amount of $63,675.55, convertible in the amount of the VWAP for the 20 days preceding the date of conversion with Mary Sinanyan, dated October 1, 2013 (included as exhibit 10.121 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.125 | Consulting Services Agreement between VG Life Sciences Inc. and Gary Musso, PhD, dated October 7, 2013 (included as exhibit 10.131 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.126 | Consulting Services Agreement between VG Life Sciences Inc. and Catherine Strader, PhD, dated October 29, 2013 (included as exhibit 10.130 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.127* | Convertible Debenture between VG Life Sciences Inc. and JTL Enterprises Corp., dated December 1, 2013. |
| 32 |
| 10.128* | Convertible Debenture between VG Life Sciences Inc. and JTL Enterprises Corp., dated December 31, 2013. |
| 10.129 | 2013 Equity Incentive Plan for VG Life Sciences Inc., adopted December 20, 2013, approved by stockholders December 30, 2013 (included as exhibit 10.122 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.130 | Consulting Agreement between VG Life Sciences Inc. and JTL Enterprises Corp, dated January 1, 2014 (included as exhibit 10.132 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.131* | Convertible Promissory Note and Warrant Purchase Agreement between VG Life Sciences Inc. and KED Consulting Group LLC, dated as of January 24, 2014. |
| 10.132* | Convertible Debenture between VG Life Sciences Inc. and JTL Enterprises Corp., dated January 31, 2014. |
| 10.133 | Tg IT, Inc. d/b/a Anchor Point IT Solutions Memorandum of Understanding, dated February 1, 2014 (included as exhibit 10.123 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.134 | Convertible Promissory Note and Warrant Purchase Agreement between VG Life Sciences Inc. and KED Consulting Group LLC, dated March 1, 2014 (included as exhibit 10.124 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.135 | Convertible Promissory Note between VG Life Sciences Inc. and KED Consulting Group, LLC, dated March 1, 2014 (included as exhibit 10.125 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.136 | Investment Agreement with Dutchess Opportunity Fund II L.P. dated March 28, 2014 (included as exhibit 10.126 to the Form 10-12G filed June 20, 2014, and incorporated herein by reference). |
| 10.137 | Convertible Promissory Note and Warrant Purchase Agreement between VG Life Sciences Inc. and Wild Harp Holdings, LLC, dated July 9, 2014 (included as exhibit 10.129 to the Form 10-12G/A filed September 10, 2014, and incorporated herein by reference). |
| 10.138 | Convertible Promissory Note and Warrant Purchase Agreement between VG Life Sciences Inc. and DW Odell Company, LLC, dated July 9, 2014 (included as exhibit 10.130 to the Form 10-12G/A filed September 10, 2014, and incorporated herein by reference). |
| 10.139 | First Amendment to the Convertible Promissory Note and Warrant Purchase Agreement between VG Life Sciences Inc. and Wild Harp Holdings, LLC, dated July 9, 2014 and made effective August 14, 2014 (included as exhibit 10.131 to the Form 10-12G/A filed September 10, 2014, and incorporated herein by reference). |
| 10.140 | First Amendment to the Convertible Promissory Note and Warrant Purchase Agreement between VG Life Sciences Inc. and DW Odell Company, LLC, dated July 9, 2014 and made effective August 14, 2014 (included as exhibit 10.132 to the Form 10-12G/A filed September 10, 2014, and incorporated herein by reference). |
| 10.141 | Convertible Promissory Note and Warrant Purchase Agreement between VG Life Sciences Inc. and MedBridge Development Company, LLC, dated August 27, 2014 (included as exhibit 10.133 to the Form 10-12G/A filed October 1, 2014, and incorporated herein by reference). |
| 33 |
| 10.142 | Amendment to the Registration Rights Agreement with Dutchess Opportunity Fund II, LP, dated September 4, 2014 (included as exhibit 10.134 to the Form 10-12G/A filed October 1, 2014, and incorporated herein by reference). |
| 10.143* | Notice of Conversion between VG Life Sciences Inc. and DMBM Inc., dated September 11, 2014, for conversion under the Note Purchase Agreements dated August 1, 2013, December 1, 2013, and January 31, 2014. |
| 10.144 | Convertible Promissory Note issued September 16, 2014 to DW Odell Company, LLC (included as exhibit 10.135 to the Form 10-12G/A filed October 1, 2014, and incorporated herein by reference). |
| 10.145 | Warrant issued September 16, 2014 to DW Odell Company (included as exhibit 10.136 to the Form 10-12G/A filed October 1, 2014, and incorporated herein by reference). |
| 10.146 | Convertible Promissory Note issued September 16, 2014 to Wild Harp Holdings, LLC (included as exhibit 10.137 to the Form 10-12G/A filed October 1, 2014, and incorporated herein by reference). |
| 10.147 | Warrant issued September 16, 2014 to Wild Harp Holdings, LLC (included as exhibit 10.138 to the Form 10-12G/A filed October 1, 2014, and incorporated herein by reference) |
| 10.148* | Convertible Promissory Note issued October 27, 2014 to DW Odell Company, LLC. |
| 10.149* | Warrant issued October 27, 2014 to DW Odell Company. |
| 10.150* | Convertible Promissory Note issued October 27, 2014 to Wild Harp Holdings, LLC. |
| 10.151* | Warrant issued October 27, 2014 to Wild Harp Holdings, LLC. |
| 31.1* | Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
| 31.2* | Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 . |
| 32.1* | Certification of Officers pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 . |
| 101.INS* | XBRL Instance Document. |
| 101.SCH* | XBRL Taxonomy Extension Schema. |
| 101.CAL* | XBRL Taxonomy Extension Calculation Linkbase. |
| 101.DEF* | XBRL Taxonomy Extension Definition Linkbase. |
| 101.LAB* | XBRL Taxonomy Extension Label Linkbase. |
| 101.PRE* | XBRL Taxonomy Extension Presentation Linkbase . |
* filed herewith.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| VG LIFE SCIENCES INC. | ||
| Date: November 13, 2014 | By: | /s/ John Tynan |
|
John Tynan Chief Executive Officer (Principal Executive Officer) | ||
| Date: November 13, 2014 | By: | /s/ David Odell |
| David Odell | ||
| Chief Financial Officer | ||
| (Principal Financial Officer, and | ||
| Principal Accounting Officer) | ||
| 34 |
Exhibit 10.80
THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AND HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF. NO SUCH SALE OR DISTRIBUTION MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT UNLESS AN EXEMPTION FROM REGISTRATION IS AVAILABLE UNDER THE SECURITIES ACT OF 1933 (THE "SECURITIES ACT").
CONVERTIBLE DEBENTURE
| $54,750.00 | Effective as of April 1, 2012 |
For value received, VG LIFE SCIENCES Inc., (formerly Viral Genetics, Inc.) a Delaware corporation (the "Company"), promises to pay to the order of JTL Enterprises Corp., 1107 38th Avenue, Seattle, WA 98122 (the "Holder"), a New York corporation, the principal sum of FIFTY FOUR THOUSAND SEVEN HUNDRED AND FIFTY DOLLARS AND NO CENTS or the aggregate outstanding principal amount hereof, whichever is less (the "Principal"), represents a series of monthly obligations for services ("Monthly Services") rendered pursuant to a Consulting Agreement between the parties which remain unpaid (each related to a specific month as per Schedule A) rendered by the Holder to the Company in months between January 2011 and February 2012, inclusive, in the amounts specified on Schedule A attached hereto and to pay interest on the outstanding principal amount of this Convertible Debenture (this "Debenture") as provided herein.
1. Definitions. The following terms shall have the definitions set forth in this Section 1:
| (a) | "Business Day" means any day on which banks are open for business in both the State of California and the State of New York. |
| (b) | "Common Stock" means the Company's common stock, par value $0.0001 per Share, post-split shares. |
| (c) | "Conversion Price" shall be $0.10 per Share. |
| (d) | "Shares" means shares of Common Stock. |
| (e) | "Trading Day" means a calendar day on which the Shares are quoted for trading on the Trading Market. |
| (f) | "Trading Market" means the following markets or exchanges on which the Shares are listed or quoted for trading on the date in question: The Over The Counter Bulletin Board, the PinkSheets, OTCPink , the Nasdaq SmallCap Market, the American Stock Exchange, the New York Stock Exchange, the Nasdaq National Market, the Toronto Stock Exchange, the TSX Venture Exchange, or any other securities exchange registered with the United States Securities and Exchange Commission. |
| 1 |
2. Monthly Services. Periodic Monthly Services rendered by the Holder to the Company evidenced by this Debenture, shall be set forth on Schedule A attached hereto. The Holder is authorized by the Company to modify Schedule A from time to time to reflect the amount of any partial conversion of this Debenture.
3. Interest. Interest on the outstanding Principal amount of this Debenture will accrue at a rate equal to one percent (1%) per annum from the date of end of each month of Monthly Services as set forth on Schedule A. Interest will be computed on the basis of a year of 12 months, each having 30 days, and will be paid on the Maturity Date and upon any permitted prepayment of this Debenture.
4. Repayment. The Company shall pay the Principal amount of this Debenture, together with all accrued and unpaid interest, to the Holder on April 30, 2013 (the "Maturity Date").
5. Payment. All payments due under this Debenture shall be made in either the lawful money of the United States of America or in Shares, as determined by the Company in its discretion in accordance with Section 5 hereof, without set-off, deduction, demand or notice.
| (a) | Form of Payment. Five (5) business days prior to the Maturity Date, the Company, at its sole discretion, shall notify the Holder whether the payment due on the Maturity Date shall be made in cash or in Shares. |
| (b) | Payment in Cash. All payments in cash shall be made to the Holder by check or by wire transfer to such bank as the Holder may advise the Company in writing. |
| (c) | Payment in Shares. The number of Shares issuable upon a payment being made in Shares shall be calculated by dividing the aggregate amount due on the Maturity Date by the Conversion Price. No fractional Shares will be issued upon conversion of this Debenture or a payment by the Company in Shares. In lieu of any fractional Share to which the Holder would otherwise be entitled upon a payment in Shares, the Company will pay to the Holder in cash the amount of the unpaid or unconverted Principal and interest balance of this Debenture that would otherwise be paid or converted into such fractional Share. Shares issued hereunder shall be transmitted by the transfer agent of the Company to the Holder either by crediting the account of the Holder's designated broker with the Depository Trust Company through its Deposit Withdrawal Agent Commission ("DWAC"), or, if so elected by Holder, by physical delivery of certificates to Holder's address within five (5) Trading Days from the Due Date. If the Company fails for any reason to deliver to the Holder the Shares by the requisite delivery date, the Company shall pay to the Holder, in cash, as liquidated damages and not as a penalty, for each $1,000 of Shares not timely delivered, $5 per Trading Day (increasing to $10 per Trading Day on the fifteenth (15) Trading Day after such liquidated damages begin to accrue) for each Trading Day after such requisite delivery date until such Shares are delivered. In addition to any other rights available to the Holder, if the Company fails to cause its transfer agent to deliver to the Holder the Shares on or before the requisite delivery date, and if after such date the Holder is required by its broker to purchase (in an open market transaction or otherwise), or the Holder's brokerage firm otherwise purchases, Shares to deliver in satisfaction of a sale by the Holder of the Shares which the Holder anticipated receiving pursuant to this Debenture (a "Buy-In"), then the Company shall (1) pay in cash to the Holder the amount by which (x) the Holder's total purchase price (including brokerage commissions, if any) for the Shares so purchased exceeds (y) the amount obtained by multiplying (A) the number of Shares that the Company was required to deliver to the Holder multiplied by (B) the price at which the sell order giving rise to such purchase obligation was executed, and (2) deliver to the Holder the number of Shares that would have been issued had the Company timely complied with its exercise and delivery obligations hereunder. For example, if the Holder purchases Shares having a total purchase price of $11,000 to cover a Buy-In with an aggregate sale price giving rise to such purchase obligation of $10,000, under clause (1) of the immediately preceding sentence the Company shall be required to pay the Holder $ 1,000. The Holder shall provide the Company written notice indicating the amounts payable to the Holder in respect of the Buy-In and, upon request of the Company, commercially reasonable evidence of the amount of such loss. |
| (d) | Adjustments. If the Company, at any time while this Debenture is outstanding subdivides outstanding Shares into a larger number of shares or combines (including by way of reverse stock split) outstanding Shares into a smaller number of shares, then the Conversion Price shall be multiplied by a fraction of which the numerator shall be the number of Shares outstanding immediately before such event and of which the denominator shall be the number of Shares outstanding immediately after such event. |
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6. Prepayment. This Debenture may not be prepaid by the Company without the prior written consent of the Holder, except as provided in Section 7 of this Debenture.
7. Conversion. At any time prior to five (5) business days prior to the Maturity Date, all or any portion of the Principal amount of this Debenture, together will accrued interest thereon, may be converted at the option of the Holder, at any time and from time to time, in the minimum principal amount of $5,000 and integral multiples of $1,000 thereafter, upon not less than two (2) three (3) Business Days after the Company's receipt of the Conversion Notice (as hereinafter defined) from the Holder and payment in full of the Conversion Price as then in effect. Each "Conversion Notice" shall mean a written notice from the Holder informing the Company of the date of the conversion, the principal amount of this Debenture being converted, the number of shares of Common Stock to be received upon conversion and confirming that the Conversion Price will be paid in cash. The Conversion Price shall be paid by certified check or by wire transfer of immediately available funds to a bank account designated by the Company in writing. Within three (3) Business Days after payment of the Conversion Price, the Company will deliver a certificate for the shares of Common Stock issued upon conversion to the Holder, or at the Holder's request, to a brokerage account for the benefit of Holder. The Company shall at all times reserve for issuance a number of shares of Common Stock sufficient to satisfy the conversion feature of this Debenture. The number of shares of Common Stock issuable upon the conversion of all or a portion of this Debenture shall be equal to the Principal amount of this Debenture being converted divided by the Conversion Price. For purposes hereof, any partial conversion of this Debenture, each Loan shall be considered separate and distinct indebtedness of the Company to the Holder for purposes of determining the holding period of each item of indebtedness represented by the Loan. Notwithstanding anything set forth herein, in no event shall the Holder be entitled to convert for a number of shares of Common Stock in excess of that number of shares of Common Stock which, upon giving effect to such conversion, would cause the aggregate number of shares of Common Stock beneficially owned by the Holder and its affiliates to exceed 9.99% of the outstanding shares of the Common Stock following such conversion. Notwithstanding receipt of a Conversion Notice, the Company shall have the right to prepay this Debenture in the amount being converted if the principal amount to be converted together with accrued interest thereon is paid in immediately available funds within one (1) business day after the date of the
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8. Seniority. The indebtedness represented by this Debenture is and shall be an obligation of the Company ranking senior in right of payment, liquidation and otherwise to any future indebtedness and other obligations of the Company. The Company will not create any indebtedness that is senior in priority to the indebtedness represented by this Debenture.
9. Default. Any one of the following occurrences shall constitute an "Event of Default" under this Debenture:
(a) failure of Company to pay any amount that it payable under this Debenture on the Due Date, provided that such failure is not cured within a grace period of ten (10) calendar days; or
(b) failure to comply with or perform any other agreement or covenant of the Company contained herein, which failure does not otherwise constitute an Event of Default, provided that such failure has not been cured within thirty (30) calendar days written notice by Holder to the Company; or
(c) there shall occur any default or event of default, any similar event, any event that requires the prepayment of borrowed money or permits the acceleration of the maturity thereof, or any event or condition that might become any of the foregoing with notice or the passage of time or both, under the terms of any evidence of indebtedness or other agreement issued or assumed or entered into by the Company, or under the terms of any document or instrument under which any such evidence of indebtedness or other agreement is issued, assumed, secured, or guaranteed, and such event shall continue beyond any applicable notice, grace or cure period, provided that such condition shall not have been cured within thirty (30) calendar days of notice by Holder; or
(d) the Company shall fail to maintain its existence in good standing in its state of incorporation; provided that such condition shall not have been cured within thirty (30) calendar days of notice by Holder; or
(e) a judgment or settlement shall be entered or agreed to in any proceeding which would reasonably be expected to have a material and adverse effect on the ability of the Company to repay this Debenture; or any garnishment, summons, writ of attachment, citation, levy or the like is issued against or served upon Holder for the attachment of any property of the Company in Holder's possession or control, provided that such condition shall not have been cured within thirty (30) calendar days of notice by Holder of such condition; or
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(f) any Share issued pursuant to this Debenture shall not be duly authorized, validly issued, fully paid or nonassessable, provided that such condition shall not have been cured within ninety (90) calendar days of notice by Holder of such condition; or
(g) the Company shake make a voluntary filing for bankruptcy under Title 11, Chapter 7 of the United States Code; or
(h) there shall be appointed a receiver or trustee to take possession of the property or assets of the Company under Title 11, Chapter 7 of the United States Code.
10. Remedies. Upon the occurrence and during the continuance of an Event of Default, this Debenture and shall become immediately due in full, and unpaid amounts hereunder will accrue interest at the rate equal to the stated rate plus 5.00% per annum, and Holder may exercise any rights and remedies under this Debenture, any Transaction Document or other document or instrument and at law or in equity. The time of payment of this Debenture is also subject to acceleration if an Event of Default occurs. Notwithstanding the foregoing, the entire unpaid Principal sum of this Debenture, together with accrued and unpaid interest thereon, shall become immediately due and payable upon any of the Events of Default set forth in this Debenture.
11. Transfer; Successors and Assigns. The terms and conditions of this Debenture shall inure to the benefit of and be binding upon the respective successors and assigns of the parties. At the election of the Holder, but subject-to compliance with applicable securities laws, this Debenture may be assigned or transferred by the Holder, in whole or in part, upon surrender of this Debenture, duly endorsed, and accompanied by a duly executed written instrument of transfer in customary form, following which a new Debenture for the same principal amount and interest will be issued to, and registered in the name of, the transferee. If less than the entire amount of this Debenture is transferred or assigned, the Company will issue new Debentures to the transferee, in the amount transferred or assigned, and to the Holder, in the remaining Principal amount hereof after the transfer or assignment. This Debenture shall be binding upon and inure to the benefit of the Company and the Holder, their successors and permitted assigns and the transferees of the Holder.
12. Governing Law. This Debenture and all acts and transactions pursuant hereto and the rights and obligations of the Company and the Holder shall be governed, construed and interpreted in accordance with the laws of the State of California, without giving effect to any of its principles of conflicts of law or choice of law principles which would result in the application of the laws of another jurisdiction.
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13. Notices. Any notice required or permitted by this Debenture shall be in writing and shall be deemed sufficient upon receipt, when delivered personally or by courier, overnight delivery service or confirmed facsimile, or 96 hours after being deposited in the U.S. mail as certified or registered mail with postage prepaid, if such notice is addressed to the party to be notified at such party's address or facsimile number as set forth herein or as subsequently modified by written notice.
14. Amendments and Waivers. This Debenture may only be amended, modified or waived by a written instrument executed by the Company and the Holder. Any amendment or waiver effected in accordance with this Section 14 shall be binding upon the Company, the Holder and each transferee or permitted assigns of any Debenture.
15. Loss of Debenture. Upon receipt by the Company of a customary representation by the Holder of the loss, theft, destruction or mutilation of this Debenture or any Debenture exchanged for it, and a customary indemnity undertaking by the Holder (in case of loss, theft or destruction) or surrender and cancellation of such Debenture {in the case of mutilation), the Company will make and deliver in lieu of such Debenture a new Debenture of like tenor.
16. Waiver of Presentment, etc. The Company hereby expressly waives presentment, demand for payment, dishonor, notice of dishonor, protest, notice of protest and any other formality upon the occurrence of an Event of Default.
17. Entire Understanding. This Debenture sets forth the entire understanding agreement of the Company and the Holder with respect to the subject matter hereof and it supersedes all prior and/or contemporaneous understandings and agreements with respect to such subject matter, all of which are merged herein, and it specifically amends and restates a Debenture dated this date in the same principal amount hereof, which did not accurately reflect the understanding and agreement of the Company and the Holder.
18. Costs and Fees. The Company agrees to pay all costs, expenses, including, without limitation, reasonable attorneys' fees and disbursements, incurred by the Holder in endeavoring to collect any amounts payable hereunder (including, without limitation, amounts payable in Shares) which are not paid when due or otherwise in enforcing any provision of this Debenture and any of the rights and remedies of the Holder under this Debenture, at law or in equity.
[signature page follows]
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IN WITNESS WHEREOF, this Debenture has been executed by a duly authorized officer of the Company as of the date first written above.
| COMPANY, | ||
VG LIFE SCIENCES INC. (FORMERLY VIRAL GENETICS, INC. | ||
| By: | /s/ Haig Keledjian | |
Name: Haig Keledjian Title: Chairman | ||
NOTICE OF CONVERSION
CON VETIBLE DEBENTURE
(Date)
VG Life Sciences Inc.
2290 Huntington Drive, Suite 100
San Marino, CA 91108
Dear Mr. Keledjian,
JTL Enterprises Corp (JTL) is the holder of a Convertible Debenture dated April 1, 2012 (the "Debenture") in the amount of $54,750 made and issued by VG Life Sciences Inc. ("VGLS"), a Delaware corporation in favor of JTL.
This letter shall constitute notice to VGLS that JTL does hereby exercise its right to take payment of the outstanding principal amount of the Debenture, or the amount of $____________, in shares of VGLS common stock at a price of $0.10 per share. This will leave the remainder of $____________, still due and payable under this April 1, 2012 convertible debenture.
Please have the shares issued in the names of Myron Landin (60% share) and Samuel Zemsky (40% share) in accordance with the terms and provisions of our agreement. JTL is not and never has been a 5% of 10% holder of VGLS common stock.
Very truly yours,
/s/ Myron W. Landin
Myron W. Landin
President
JTL Enterprises Corp.
1107 38th Avenue
Seattle, WA 98122
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Schedule A
| Month of Services | Monthly Services Fee | |||
| January-11 | $ | 4,500.00 | ||
| February-11 | 4,500.00 | |||
| March-11 | 13,750.00 | |||
| June-11 | 4,500.00 | |||
| July-11 | 4,500.00 | |||
| August-11 | 1,500.00 | |||
| September-11 | 4,500.00 | |||
| October-11 | 4,000.00 | |||
| December-11 | 4,500.00 | |||
| January-12 | 3,000.00 | |||
| February-12 | 5,500.00 | |||
| $ | 54,750.00 | |||
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Exhibit 10.102
THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AND HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF. NO SUCH SALE OR DISTRIBUTION MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT UNLESS AN EXEMPTION FROM REGISTRATION IS AVAILABLE UNDER THE SECURITIES ACT OF 1933 (THE "SECURITIES ACT").
CONVERTIBLE DEBENTURE
| $19,000 | Effective as of December 31, 2012 |
For value received, VG LIFE SCIENCES Inc., (formerly Viral Genetics, Inc.) a Delaware corporation (the "Company"), promises to pay to the order of JTL Enterprises Corp., 1107 38' Avenue, Seattle, WA 98122 (the "Holder"), a New York corporation, the principal sum of NINETEEN THOUSAND DOLLARS AND NO CENTS or the aggregate outstanding principal amount hereof, whichever is less (the "Principal"), represents a series of monthly obligations for services ("Monthly Services") rendered pursuant to a Consulting Agreement between the parties which remain unpaid (each related to a specific month as per Schedule A) rendered by the Holder to the Company in months between August 2012 and December 2012, inclusive, in the amounts specified on Schedule A attached hereto and to pay interest on the outstanding principal amount of this Convertible Debenture (this "Debenture") as provided herein.
1. Definitions. The following terms shall have the definitions set forth in this Section 1:
| (a) | "Business Day" means any day on which banks are open for business in both the State of California and the State of New York. |
| (b) | "Common Stock" means the Company's common stock, par value $0.0001 per Share, post-split shares. |
| (c) | "Conversion Price" shall be $0.10 per Share. |
| (d) | "Shares" means shares of Common Stock. |
| (e) | "Trading Day" means a calendar day on which the Shares are quoted for trading on the Trading Market. |
| (f) | "Trading Market" means the following markets or exchanges on which the Shares are listed or quoted for trading on the date in question: The Over The Counter Bulletin Board, the PinkSheets, OTCPink , the Nasdaq SmallCap Market, the American Stock Exchange, the New York Stock Exchange, the Nasdaq National Market, the Toronto Stock Exchange, the TSX Venture Exchange, or any other securities exchange registered with the United States Securities and Exchange Commission. |
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2. Monthly Services. Periodic Monthly Services rendered by the Holder to the Company evidenced by this Debenture, shall be set forth on Schedule A attached hereto. The Holder is authorized by the Company to modify Schedule A from time to time to reflect the amount of any partial conversion of this Debenture.
3. Interest. Interest on the outstanding Principal amount of this Debenture will accrue at a rate equal to one percent (1%) per annum from the date of end of each month of Monthly Services as set forth on Schedule A. Interest will be computed on the basis of a year of 12 months, each having 30 days, and will be paid on the Maturity Date and upon any permitted prepayment of this Debenture.
4. Repayment. The Company shall pay the Principal amount of this Debenture, together with all accrued and unpaid interest, to the Holder on April 30, 2013 (the "Maturity Date").
5. Payment. All payments due under this Debenture shall be made in either the lawful money of the United States of America or in Shares, as determined by the Company in its discretion in accordance with Section 5 hereof, without set-off, deduction, demand or notice.
| (a) | Form of Payment. Five (5) business days prior to the Maturity Date, the Company, at its sole discretion, shall notify the Holder whether the payment due on the Maturity Date shall be made in cash or in Shares. |
| (b) | Payment in Cash. All payments in cash shall be made to the Holder by check or by wire transfer to such bank as the Holder may advise the Company in writing. |
| (c) | Payment in Shares. The number of Shares issuable upon a payment being made in Shares shall be calculated by dividing the aggregate amount due on the Maturity Date by the Conversion Price. No fractional Shares will be issued upon conversion of this Debenture or a payment by the Company in Shares. In lieu of any fractional Share to which the Holder would otherwise be entitled upon a payment in Shares, the Company will pay to the Holder in cash the amount of the unpaid or unconverted Principal and interest balance of this Debenture that would otherwise be paid or converted into such fractional Share. Shares issued hereunder shall be transmitted by the transfer agent of the Company to the Holder either by crediting the account of the Holder's designated broker with the Depository Trust Company through its Deposit Withdrawal Agent Commission ("DWAC"), or, if so elected by Holder, by physical delivery of certificates to Holder's address within five (5) Trading Days from the Due Date. If the Company fails for any reason to deliver to the Holder the Shares by the requisite delivery date, the Company shall pay to the Holder, in cash, as liquidated damages and not as a penalty, for each $1,000 of Shares not timely delivered, $5 per Trading Day (increasing to $10 per Trading Day on the fifteenth (15) Trading Day after such liquidated damages begin to accrue) for each Trading Day after such requisite delivery date until such Shares are delivered. In addition to any other rights available to the Holder, if the Company fails to cause its transfer agent to deliver to the Holder the Shares on or before the requisite delivery date, and if after such date the Holder is required by its broker to purchase (in an open market transaction or otherwise), or the Holder's brokerage firm otherwise purchases, Shares to deliver in satisfaction of a sale by the Holder of the Shares which the Holder anticipated receiving pursuant to this Debenture (a "Buy-In"), then the Company shall (1) pay in cash to the Holder the amount by which (x) the Holder's total purchase price (including brokerage commissions, if any) for the Shares so purchased exceeds (y) the amount obtained by multiplying (A) the number of Shares that the Company was required to deliver to the Holder multiplied by (B) the price at which the sell order giving rise to such purchase obligation was executed, and (2) deliver to the Holder the number of Shares that would have been issued had the Company timely complied with its exercise and delivery obligations hereunder. For example, if the Holder purchases Shares having a total purchase price of $11,000 to cover a Buy-In with an aggregate sale price giving rise to such purchase obligation of $10,000, under clause (1) of the immediately preceding sentence the Company shall be required to pay the Holder $ 1,000. The Holder shall provide the Company written notice indicating the amounts payable to the Holder in respect of the Buy-In and, upon request of the Company, commercially reasonable evidence of the amount of such loss. |
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| (d) | Adjustments. If the Company, at any time while this Debenture is outstanding subdivides outstanding Shares into a larger number of shares or combines (including by way of reverse stock split) outstanding Shares into a smaller number of shares, then the Conversion Price shall be multiplied by a fraction of which the numerator shall be the number of Shares outstanding immediately before such event and of which the denominator shall be the number of Shares outstanding immediately after such event. |
6. Prepayment. This Debenture may not be prepaid by the Company without the prior written consent of the Holder, except as provided in Section 7 of this Debenture.
7. Conversion. At any time prior to five (5) business days prior to the Maturity Date, all or any portion of the Principal amount of this Debenture, together will accrued interest thereon, may be converted at the option of the Holder, at any time and from time to time, in the minimum principal amount of $5,000 and integral multiples of $1,000 thereafter, upon not less than two (2) three (3) Business Days after the Company's receipt of the Conversion Notice (as hereinafter defined) from the Holder and payment in full of the Conversion Price as then in effect. Each "Conversion Notice" shall mean a written notice from the Holder informing the Company of the date of the conversion, the principal amount of this Debenture being converted, the number of shares of Common Stock to be received upon conversion and confin-ning that the Conversion Price will be paid in cash. The Conversion Price shall be paid by certified check or by wire transfer of immediately available funds to a bank account designated by the Company in writing. Within three (3) Business Days after payment of the Conversion Price, the Company will deliver a certificate for the shares of Common Stock issued upon conversion to the Holder, or at the Holder's request, to a brokerage account for the benefit of Holder. The Company shall at all times reserve for issuance a number of shares of Common Stock sufficient to satisfy the conversion feature of this Debenture. The number of shares of Common Stock issuable upon the conversion of all or a portion of this Debenture shall be equal to the Principal amount of this Debenture being converted divided by the Conversion Price. For purposes hereof, any partial conversion of this Debenture, each Loan shall be considered separate and distinct indebtedness of the Company to the Holder for purposes of determining the holding period of each item of indebtedness represented by the Loan. Notwithstanding anything set forth herein, in no event shall the Holder be entitled to convert for a number of shares of Common Stock in excess of that number of shares of Common Stock which, upon giving effect to such conversion, would cause the aggregate number of shares of Common Stock beneficially owned by the Holder and its affiliates to exceed 9.99% of the outstanding shares of the Common Stock following such conversion. Notwithstanding receipt of a Conversion Notice, the Company shall have the right to prepay this Debenture in the amount being converted if the principal amount to be converted together with accrued interest thereon is paid in immediately available funds within one (1) business day after the date of the
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8. Seniority. The indebtedness represented by this Debenture is and shall be an obligation of the Company ranking senior in right of payment, liquidation and otherwise to any future indebtedness and other obligations of the Company. The Company will not create any indebtedness that is senior in priority to the indebtedness represented by this Debenture.
9. Default. Any one of the following occurrences shall constitute an "Event of Default" under this Debenture:
(a) failure of Company to pay any amount that it payable under this Debenture on the Due Date, provided that such failure is not cured within a grace period of ten (10) calendar days; or
(b) failure to comply with or perform any other agreement or covenant of the Company contained herein, which failure does not otherwise constitute an Event of Default, provided that such failure has not been cured within thirty (30) calendar days written notice by Holder to the Company; or
(c) there shall occur any default or event of default, any similar event, any event that requires the prepayment of borrowed money or permits the acceleration of the maturity thereof, or any event or condition that might become any of the foregoing with notice or the passage of time or both, under the tefins of any evidence of indebtedness or other agreement issued or assumed or entered into by the Company, or under the terms of any document or instrument under which any such evidence of indebtedness or other agreement is issued, assumed, secured, or guaranteed, and such event shall continue beyond any applicable notice, grace or cure period, provided that such condition shall not have been cured within thirty (30) calendar days of notice by Holder; or
(d) the Company shall fail to maintain its existence in good standing in its state of incorporation; provided that such condition shall not have been cured within thirty (30) calendar days of notice by Holder; or
(e) a judgment or settlement shall be entered or agreed to in any proceeding which would reasonably be expected to have a material and adverse effect on the ability of the Company to repay this Debenture; or any garnishment, summons, writ of attachment, citation, levy or the like is issued against or served upon Holder for the attachment of any property of the Company in Holder's possession or control, provided that such condition shall not have been cured within thirty (30) calendar days of notice by Holder of such condition; or
| 4 |
(f) any Share issued pursuant to this Debenture shall not be duly authorized, validly issued, fully paid or nonassessable, provided that such condition shall not have been cured within ninety (90) calendar days of notice by Holder of such condition; or
(g) the Company shake make a voluntary filing for bankruptcy under Title 11, Chapter 7 of the United States Code; or
(h) there shall be appointed a receiver or trustee to take possession of the property or assets of the Company under Title 11, Chapter 7 of the United States Code.
10. Remedies. Upon the occurrence and during the continuance of an Event of Default, this Debenture and shall become immediately due in full, and unpaid amounts hereunder will accrue interest at the rate equal to the stated rate plus 5.00% per annum, and Holder may exercise any rights and remedies under this Debenture, any Transaction Document or other document or instrument and at law or in equity. The time of payment of this Debenture is also subject to acceleration if an Event of Default occurs. Notwithstanding the foregoing, the entire unpaid Principal sum of this Debenture, together with accrued and unpaid interest thereon, shall become immediately due and payable upon any of the Events of Default set forth in this Debenture.
11. Transfer; Successors and Assigns. The terms and conditions of this Debenture shall inure to the benefit of and be binding upon the respective successors and assigns of the parties. At the election of the Holder, but subject-to compliance with applicable securities laws, this Debenture may be assigned or transferred by the Holder, in whole or in part, upon surrender of this Debenture, duly endorsed, and accompanied by a duly executed written instrument of transfer in customary form, following which a new Debenture for the same principal amount and interest will be issued to, and registered in the name of, the transferee. If less than the entire amount of this Debenture is transferred or assigned, the Company will issue new Debentures to the transferee, in the amount transferred or assigned, and to the Holder, in the remaining Principal amount hereof after the transfer or assignrnent. This Debenture shall be binding upon and inure to the benefit of the Company and the Holder, their successors and permitted assigns and the transferees of the Holder.
12. Governing Law. This Debenture and all acts and transactions pursuant hereto and the rights and obligations of the Company and the Holder shall be governed, construed and interpreted in accordance with the laws of the State of California, without giving effect to any of its principles of conflicts of law or choice of law principles which would result in the application of the laws of another jurisdiction.
13. Notices. Any notice required or permitted by this Debenture shall be in writing and shall be deemed sufficient upon receipt, when delivered personally or by courier, overnight delivery service or confifined facsimile, or 96 hours after being deposited in the U.S. mail as certified or registered mail with postage prepaid, if such notice is addressed to the party to be notified at such party's address or facsimile number as set forth herein or as subsequently modified by written notice.
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14. Amendments and Waivers. This Debenture may only be amended, modified or waived by a written instrument executed by the Company and the Holder. Any amendment or waiver effected in accordance with this Section 14 shall be binding upon the Company, the Holder and each transferee or permitted assigns of any Debenture.
15. Loss of Debenture. Upon receipt by the Company of a customary representation by the Holder of the loss, theft, destruction or mutilation of this Debenture or any Debenture exchanged for it, and a customary indemnity undertaking by the Holder (in case of loss, theft or destruction) or surrender and cancellation of such Debenture {in the case of mutilation), the Company will make and deliver in lieu of such Debenture a new Debenture of like tenor.
16. Waiver of Presentment, etc. The Company hereby expressly waives presentment, demand for payment, dishonor, notice of dishonor, protest, notice of protest and any other formality upon the occurrence of an Event of Default.
17. Entire Understanding. This Debenture sets forth the entire understanding agreement of the Company and the Holder with respect to the subject matter hereof and it supersedes all prior and/or contemporaneous understandings and agreements with respect to such subject matter, all of which are merged herein, and it specifically amends and restates a Debenture dated this date in the same principal amount hereof, which did not accurately reflect the understanding and agreement of the Company and the Holder.
18. Costs and Fees. The Company agrees to pay all costs, expenses, including, without limitation, reasonable attorneys' fees and disbursements, incurred by the Holder in endeavoring to collect any amounts payable hereunder (including, without limitation, amounts payable in Shares) which are not paid when due or otherwise in enforcing any provision of this Debenture and any of the rights and remedies of the Holder under this Debenture, at law or in equity.
[signature page follows]
| 6 |
IN WITNESS WHEREOF, this Debenture has been executed by a duly authorized officer of the Company as of the date first written above.
| COMPANY, | ||
VG LIFE SCIENCES INC. (FORMERLY VIRAL GENETICS, INC. | ||
| By: | /s/ Haig Keledjian | |
Name: Haig Keledjian Title: Chairman | ||
| 7 |
NOTICE OF CONVERSION
CONVERTIBLE DEBENTURE
(Date)
VG Life Sciences Inc.
2290 Huntington Drive, Suite 100
San Marino, CA 91108
Dear Mr. Keledjian,
JTL Enterprises Corp (JTL) is the holder of a Convertible Debenture dated December 31, 2012 (the "Debenture") in the amount of $19,000 made and issued by VG Life Sciences Inc. ("VGLS"), a Delaware corporation in favor of JTL.
This letter shall constitute notice to VGLS that JTL does hereby exercise its right to take payment of the outstanding principal amount of the Debenture, or the amount of $__________, in shares of VGLS common stock at a price of $0.10 per share. This will leave the remainder of $__________, still due and payable under this December 31, 2012 convertible debenture.
Please have the shares issued in the names of Myron Landin (60% share) and Samuel Zemsky (40% share) in accordance with the terms and provisions of our agreement. JTL is not and never has been a 5% of 10% holder of VGLS common stock.
Very truly yours,
/s/ Myron W. Landin
Myron W. Landin
President
JTL Enterprises Corp.
1107 38th Avenue
Seattle, WA 98122
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Schedule A
31-Dec-12
| Month of Services | Monthly Services Fee | |||
| Aug-12 | $ | 3,000.00 | ||
| Sep-12 | 4,000.00 | |||
| Oct-12 | 4,000.00 | |||
| Nov-12 | 4,000.00 | |||
| Dec-12 | 4,000.00 | |||
| $ | 19,000.00 | ||
| 9 |
Exhibit 10.113
THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AND HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF. NO SUCH SALE OR DISTRIBUTION MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT UNLESS AN EXEMPTION FROM REGISTRATION IS AVAILABLE UNDER THE SECURITIES ACT OF 1933 (THE "SECURITIES ACT").
CONVERTIBLE DEBENTURE
| $21,000 | Effective as of June 30, 2013 |
For value received, VG LIFE SCIENCES Inc., (formerly Viral Genetics, Inc.) a Delaware corporation (the "Company"), promises to pay to the order of JTL Enterprises Corp., 1107 38th Avenue, Seattle, WA 98122 (the "Holder"), a New York corporation, the principal sum of TWENTY THOUSAND DOLLARS AND NO CENTS or the aggregate outstanding principal amount hereof, whichever is less (the "Principal"), represents a series of monthly obligations for services ("Monthly Services") rendered pursuant to a Consulting Agreement between the parties which remain unpaid (each related to a specific month as per Schedule A) rendered by the Holder to the Company in several of the months between January 2013 and June 2012, inclusive, in the amounts specified on Schedule A attached hereto and to pay interest on the outstanding principal amount of this Convertible Debenture (this "Debenture") as provided herein.
1. Definitions. The following terms shall have the definitions set forth in this Section 1:
| (a) | "Business Day" means any day on which banks are open for business in both the State of California and the State of New York. |
| (b) | "Common Stock" means the Company's common stock, par value $0.0001 per Share, post-split shares. |
| (c) | "Conversion Price" shall be $0.10 per Share. |
| (d) | "Shares" means shares of Common Stock. |
| (e) | "Trading Day" means a calendar day on which the Shares are quoted for trading on the Trading Market. |
| (f) | "Trading Market" means the following markets or exchanges on which the Shares are listed or quoted for trading on the date in question: The Over The Counter Bulletin Board, the PinkSheets, OTCPink , the Nasdaq SmallCap Market, the American Stock Exchange, the New York Stock Exchange, the Nasdaq National Market, the Toronto Stock Exchange, the TSX Venture Exchange, or any other securities exchange registered with the United States Securities and Exchange Commission. |
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2. Monthly Services. Periodic Monthly Services rendered by the Holder to the Company evidenced by this Debenture, shall be set forth on Schedule A attached hereto. The Holder is authorized by the Company to modify Schedule A from time to time to reflect the amount of any partial conversion of this Debenture.
3. Interest. Interest on the outstanding Principal amount of this Debenture will accrue at a rate equal to one percent (1%) per annum from the date of end of each month of Monthly Services as set forth on Schedule A. Interest will be computed on the basis of a year of 12 months, each having 30 days, and will be paid on the Maturity Date and upon any permitted prepayment of this Debenture.
4. Repayment. The Company shall pay the Principal amount of this Debenture, together with all accrued and unpaid interest, to the Holder on April 30, 2013 (the "Maturity Date").
5. Payment. All payments due under this Debenture shall be made in either the lawful money of the United States of America or in Shares, as determined by the Company in its discretion in accordance with Section 5 hereof, without set-off, deduction, demand or notice.
| (a) | Form of Payment. Five (5) business days prior to the Maturity Date, the Company, at its sole discretion, shall notify the Holder whether the payment due on the Maturity Date shall be made in cash or in Shares. |
| (b) | Payment in Cash. All payments in cash shall be made to the Holder by check or by wire transfer to such bank as the Holder may advise the Company in writing. |
| (c) | Payment in Shares. The number of Shares issuable upon a payment being made in Shares shall be calculated by dividing the aggregate amount due on the Maturity Date by the Conversion Price. No fractional Shares will be issued upon conversion of this Debenture or a payment by the Company in Shares. In lieu of any fractional Share to which the Holder would otherwise be entitled upon a payment in Shares, the Company will pay to the Holder in cash the amount of the unpaid or unconverted Principal and interest balance of this Debenture that would otherwise be paid or converted into such fractional Share. Shares issued hereunder shall be transmitted by the transfer agent of the Company to the Holder either by crediting the account of the Holder's designated broker with the Depository Trust Company through its Deposit Withdrawal Agent Commission ("DWAC"), or, if so elected by Holder, by physical delivery of certificates to Holder's address within five (5) Trading Days from the Due Date. If the Company fails for any reason to deliver to the Holder the Shares by the requisite delivery date, the Company shall pay to the Holder, in cash, as liquidated damages and not as a penalty, for each $1,000 of Shares not timely delivered, $5 per Trading Day (increasing to $10 per Trading Day on the fifteenth (15) Trading Day after such liquidated damages begin to accrue) for each Trading Day after such requisite delivery date until such Shares are delivered. In addition to any other rights available to the Holder, if the Company fails to cause its transfer agent to deliver to the Holder the Shares on or before the requisite delivery date, and if after such date the Holder is required by its broker to purchase (in an open market transaction or otherwise), or the Holder's brokerage firm otherwise purchases, Shares to deliver in satisfaction of a sale by the Holder of the Shares which the Holder anticipated receiving pursuant to this Debenture (a "Buy-In"), then the Company shall (1) pay in cash to the Holder the amount by which (x) the Holder's total purchase price (including brokerage commissions, if any) for the Shares so purchased exceeds (y) the amount obtained by multiplying (A) the number of Shares that the Company was required to deliver to the Holder multiplied by (B) the price at which the sell order giving rise to such purchase obligation was executed, and (2) deliver to the Holder the number of Shares that would have been issued had the Company timely complied with its exercise and delivery obligations hereunder. For example, if the Holder purchases Shares having a total purchase price of $11,000 to cover a Buy-In with an aggregate sale price giving rise to such purchase obligation of $10,000, under clause (1) of the immediately preceding sentence the Company shall be required to pay the Holder $ 1,000. The Holder shall provide the Company written notice indicating the amounts payable to the Holder in respect of the Buy-In and, upon request of the Company, commercially reasonable evidence of the amount of such loss. |
| (d) | Adjustments. If the Company, at any time while this Debenture is outstanding subdivides outstanding Shares into a larger number of shares or combines (including by way of reverse stock split) outstanding Shares into a smaller number of shares, then the Conversion Price shall be multiplied by a fraction of which the numerator shall be the number of Shares outstanding immediately before such event and of which the denominator shall be the number of Shares outstanding immediately after such event. |
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6. Prepayment. This Debenture may not be prepaid by the Company without the pnor written consent of the Holder, except as provided in Section 7 of this Debenture.
7. Conversion. At any time prior to five (5) business days prior to the Maturity Date, all or any portion of the Principal amount of this Debenture, together will accrued interest thereon, may be converted at the option of the Holder, at any time and from time to time, in the minimum principal amount of $5,000 and integral multiples of $1,000 thereafter, upon not less than two (2) three (3) Business Days after the Company's receipt of the Conversion Notice (as hereinafter defined) from the Holder and payment in full of the Conversion Price as then in effect. Each "Conversion Notice" shall mean a written notice from the Holder informing the Company of the date of the conversion, the principal amount of this Debenture being converted, the number of shares of Common Stock to be received upon conversion and confirming that the Conversion Price will be paid in cash. The Conversion Price shall be paid by certified check or by wire transfer of immediately available funds to a bank account designated by the Company in writing. Within three (3) Business Days after payment of the Conversion Price, the Company will deliver a certificate for the shares of Common Stock issued upon conversion to the Holder, or at the Holder's request, to a brokerage account for the benefit of Holder. The Company shall at all times reserve for issuance a number of shares of Common Stock sufficient to satisfy the conversion feature of this Debenture. The number of shares of Common Stock issuable upon the conversion of all or a portion of this Debenture shall be equal to the Principal amount of this Debenture being converted divided by the Conversion Price. For purposes hereof, any partial conversion of this Debenture, each Loan shall be considered separate and distinct indebtedness of the Company to the Holder for purposes of determining the holding period of each item of indebtedness represented by the Loan. Notwithstanding anything set forth herein, in no event shall the Holder be entitled to convert for a number of shares of Common Stock in excess of that number of shares of Common Stock which, upon giving effect to such conversion, would cause the aggregate number of shares of Common Stock beneficially owned by the Holder and its affiliates to exceed 9.99% of the outstanding shares of the Common Stock following such conversion. Notwithstanding receipt of a Conversion Notice, the Company shall have the right to prepay this Debenture in the amount being converted if the principal amount to be converted together with accrued interest thereon is paid in immediately available funds within one (1) business day after the date of the
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8. Seniority. The indebtedness represented by this Debenture is and shall be an obligation of the Company ranking senior in right of payment, liquidation and otherwise to any future indebtedness and other obligations of the Company. The Company will not create any indebtedness that is senior in priority to the indebtedness represented by this Debenture.
9. Default. Any one of the following occurrences shall constitute an "Event of Default" under this Debenture:
(a) failure of Company to pay any amount that it payable under this Debenture on the Due Date, provided that such failure is not cured within a grace period of ten (10) calendar days; or
(b) failure to comply with or perfon-n any other agreement or covenant of the Company contained herein, which failure does not otherwise constitute an Event of Default, provided that such failure has not been cured within thirty (30) calendar days written notice by Holder to the Company; or
(c) there shall occur any default or event of default, any similar event, any event that requires the prepayment of borrowed money or permits the acceleration of the maturity thereof, or any event or condition that might become any of the foregoing with notice or the passage of time or both, under the terms of any evidence of indebtedness or other agreement issued or assumed or entered into by the Company, or under the temis of any document or instrument under which any such evidence of indebtedness or other agreement is issued, assumed, secured, or guaranteed, and such event shall continue beyond any applicable notice, grace or cure period, provided that such condition shall not have been cured within thirty (30) calendar days of notice by Holder; or
(d) the Company shall fail to maintain its existence in good standing in its state of incorporation; provided that such condition shall not have been cured within thirty (30) calendar days of notice by Holder; or
(e) a judgment or settlement shall be entered or agreed to in any proceeding which would reasonably be expected to have a material and adverse effect on the ability of the Company to repay this Debenture; or any garnishment, summons, writ of attachment, citation, levy or the like is issued against or served upon Holder for the attachment of any property of the Company in Holder's possession or control, provided that such condition shall not have been cured within thirty (30) calendar days of notice by Holder of such condition; or
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(f) any Share issued pursuant to this Debenture shall not be duly authorized, validly issued, fully paid or nonassessable, provided that such condition shall not have been cured within ninety (90) calendar days of notice by Holder of such condition; or
(g) the Company shake make a voluntary filing for bankruptcy under Title 11, Chapter 7 of the United States Code; or
(h) there shall be appointed a receiver or trustee to take possession of the property or assets of the Company under Title 11, Chapter 7 of the United States Code.
10. Remedies. Upon the occurrence and during the continuance of an Event of Default, this Debenture and shall become immediately due in full, and unpaid amounts hereunder will accrue interest at the rate equal to the stated rate plus 5.00% per annum, and Holder may exercise any rights and remedies under this Debenture, any Transaction Document or other document or instrument and at law or in equity. The time of payment of this Debenture is also subject to acceleration if an Event of Default occurs. Notwithstanding the foregoing, the entire unpaid Principal sum of this Debenture, together with accrued and unpaid interest thereon, shall become immediately due and payable upon any of the Events of Default set forth in this Debenture.
11. Transfer; Successors and Assigns. The terms and conditions of this Debenture shall inure to the benefit of and be binding upon the respective successors and assigns of the parties. At the election of the Holder, but subject-to compliance with applicable securities laws, this Debenture may be assigned or transferred by the Holder, in whole or in part, upon surrender of this Debenture, duly endorsed, and accompanied by a duly executed written instrument of transfer in customary form, following which a new Debenture for the same principal amount and interest will be issued to, and registered in the name of, the transferee. If less than the entire amount of this Debenture is transferred or assigned, the Company will issue new Debentures to the transferee, in the amount transferred or assigned, and to the Holder, in the remaining Principal amount hereof after the transfer or assignment. This Debenture shall be binding upon and inure to the benefit of the Company and the Holder, their successors and permitted assigns and the transferees of the Holder.
12. Governing Law. This Debenture and all acts and transactions pursuant hereto and the rights and obligations of the Company and the Holder shall be governed, construed and interpreted in accordance with the laws of the State of California, without giving effect to any of its principles of conflicts of law or choice of law principles which would result in the application of the laws of another jurisdiction.
13. Notices. Any notice required or permitted by this Debenture shall be in writing and shall be deemed sufficient upon receipt, when delivered personally or by courier, overnight delivery service or confirmed facsimile, or 96 hours after being deposited in the U.S. mail as certified or registered mail with postage prepaid, if such notice is addressed to the party to be notified at such party's address or facsimile number as set forth herein or as subsequently modified by written notice.
5
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14. Amendments and Waivers. This Debenture may only be amended, modified or waived by a written instrument executed by the Company and the Holder. Any amendment or waiver effected in accordance with this Section 14 shall be binding upon the Company, the Holder and each transferee or permitted assigns of any Debenture.
15. Loss of Debenture. Upon receipt by the Company of a customary representation by the Holder of the loss, theft, destruction or mutilation of this Debenture or any Debenture exchanged for it, and a customary indemnity undertaking by the Holder (in case of loss, theft or destruction) or surrender and cancellation of such Debenture {in the case of mutilation), the Company will make and deliver in lieu of such Debenture a new Debenture of like tenor.
16. Waiver of Presentment, etc. The Company hereby expressly waives presentment, demand for payment, dishonor, notice of dishonor, protest, notice of protest and any other foiniality upon the occurrence of an Event of Default.
17. Entire Understanding. This Debenture sets forth the entire understanding agreement of the Company and the Holder with respect to the subject matter hereof and it supersedes all prior and/or contemporaneous understandings and agreements with respect to such subject matter, all of which are merged herein, and it specifically amends and restates a Debenture dated this date in the same principal amount hereof, which did not accurately reflect the understanding and agreement of the Company and the Holder.
18. Costs and Fees. The Company agrees to pay all costs, expenses, including, without limitation, reasonable attorneys' fees and disbursements, incurred by the Holder in endeavoring to collect any amounts payable hereunder (including, without limitation, amounts payable in Shares) which are not paid when due or otherwise in enforcing any provision of this Debenture and any of the rights and remedies of the Holder under this Debenture, at law or in equity.
[signature page follows]
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IN WITNESS WHEREOF, this Debenture has been executed by a duly authorized officer of the Company as of the date first written above.
| COMPANY, | ||
VG LIFE SCIENCES INC. (FORMERLY VIRAL GENETICS, INC. | ||
| By: | /s/ Haig Keledjian | |
Name: Haig Keledjian Title: Chairman | ||
NOTICE OF CONVERSION
CONVETIBLE DEBENTURE
(Date)
VG Life Sciences Inc.
2290 Huntington Drive, Suite 100
San Marino, CA 91108
Dear Mr. Keledjian,
JTL Enterprises Corp (JTL) is the holder of a Convertible Debenture dated June 30, 2013 (the "Debenture") in the amount of $21,000 made and issued by VG Life Sciences Inc. ("VGLS"), a Delaware corporation in favor of JTL.
This letter shall constitute notice to VGLS that JTL does hereby exercise its right to take payment of the outstanding principal amount of the Debenture, or the amount of $____________, in shares of VGLS common stock at a price of $0.10 per share. This will leave the remainder of $____________, still due and payable under this June 30, 2013 convertible debenture.
Please have the shares issued in the names of Myron Landin (60% share) and Samuel Zemsky (40% share) in accordance with the terms and provisions of our agreement. JTL is not and never has been a 5% of 10% holder of VGLS common stock.
Very truly yours,
/s/ Myron W. Landin
Myron W. Landin
President
JTL Enterprises Corp.
1107 38th Avenue
Seattle, WA 98122
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Schedule A
June 30, 2013
| Month of Services | Monthly Services Fee | |||
| Jan-13 | $ | 8,000.00 | ||
| Feb-13 | 5,000.00 | |||
| May-13 | 4,000.00 | |||
| Jun-13 | 4,000.00 | |||
| $ | 21,000.00 | |||
| 8 |
Exhibit 10.116
RELEASE AND SETTLEMENT AGREEMENT
RELEASE AND SETTLEMENT AGREEMENT dated as of July 1, 2013 by and between VG LIFE SCIENCES, INC., formerly known as Viral Genetics, Inc., a Delaware corporation (the "Company") and DMBM, Inc., a New York corporation ("DMBM").
WHEREAS DMBM has acquired a series of Convertible Debentures dated April 1, 2012, December 31, 2012, June 30, 2013, December 1, 2013, December 31, 2013, and January 31, 2014 in the principal amount of $135,000.00 (the “Debentures”) from JTL ENTERPRISES CORP. pursuant to the Debenture Purchase Agreements dated as of August 1, 2013, December 1, 2013, December 31, 2013, and January 31, 2014 by and between JTL and DMBM.
WHEREAS, the Company desires to settle and pay for the Debenture, upon receipt of the Shares (as hereinafter defined), by DMBM from the Company.
NOW, THEREFORE, for good and valuable consideration, the receipt and legal adequacy of which is hereby acknowledged, the Parties hereby agree as follows:
| 1. | Retirement of Note. In order to settle and retire the Debt, the Company will issue to DMBM shares (the “Shares”) of the Company’s common stock, of which the Conversion Price will be the lower of (a) $0.05 per share of Common Stock of the company or (b) a discount of thirty percent (30%) from the average of the closing price of the Company’s Common Stock (on the principal exchange or market in which the Company’s Common Stock trades) for the fourteen (14) trading days prior to DMBM’s submission of a conversion notice to the Company. |
| 2. | Release. Upon receipt of the certificate for the Shares as provided for in Section 1 hereof, DMBM shall deliver the original copy of the Debentures to the Company marked “cancelled” and shall release the Company from its obligations under the Debenture. |
| 3. | No Legend. The Company will provide DMBM with an opinion of counsel that the Shares received in payment of the Debenture. are “not restricted” under the Securities Act of 1933, as amended, and the regulations thereunder. |
| 4. | Mutual Representations and Warranties. Each of the Company and DMBM hereby represents and warrants to the other that (a) it has the full legal capacity, power, ability and authority (corporate or individual, as applicable) to execute and deliver this Agreement and to perform its obligations hereunder; (b) the execution, delivery and performance of this Agreement has been duly authorized by it in accordance with all requisite corporate power and authority; as applicable, (c) this Agreement constitutes its legal, valid and binding obligation, enforceable against it in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, moratorium, insolvency and other similar laws affecting the enforcement of creditors’ rights generally and that enforcement may be limited by general principles of equity; (d) its execution, delivery and performance of this Agreement does not violate, contravene or cause a breach of, or default under, any contract or agreement to which it is a party, or violate any decree, order or judgment to which it is a party or by which it or its properties or assets are bound or any law or regulation applicable to it; and (e) no consent from, filing with, or notice to any person or entity is required to be made or obtained by it in connection with its execution, delivery and performance of this Agreement. |
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| 5. | Expenses. Each Party shall bear its own costs and expenses incurred in connection with its negotiation, execution and delivery of this Agreement, including, without limitation, the fees and disbursements of its legal counsel. |
| 6. | Remedies Cumulative; Severability. (a) All remedies, rights, and privileges available to a Party under, and in respect of, this Agreement shall be cumulative, and none of them shall be in limitation of any other remedy, right, whether available at law, in equity or otherwise. All such rights and remedies may be exercised singly or concurrently. (b) The invalidity, illegality or unenforceability of any term or provision contained in this Agreement (as determined by a court of competent jurisdiction) shall not affect the validity, legality or enforceability or any other term or provision hereof or the validity, legality or enforceability of such term or provision in any other jurisdiction or the validity, legality or enforceability of any other term or provision of this Agreement. It is the intent of the Parties that this Agreement be enforced to the fullest extent permitted by applicable law. Accordingly, the Parties agree that a court of competent jurisdiction is hereby authorized to by the Parties to modify any invalid, illegal or unenforceable term or provision to make it valid, legal and enforceable to the maximum extent permitted by applicable law. |
| 7. | Amendment; Waiver. Any amendment, modification or waiver of any term or provision of this Agreement shall only be effective if such amendment, modification or waiver is evidenced by an instrument in writing duly executed by each of the Parties hereto. No waiver by a Party of any term or provision of this Agreement shall be deemed to be a waiver of any preceding or subsequent breach of the same or similar nature or of any other term or provision of this Agreement. Any waiver shall be limited to the specific instance for which it is given. Any course of dealing between the Parties shall not be considered an amendment or modification of this Agreement or a waiver of any term or provision thereof;. |
| 8. | Governing Law. This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of New York, without regard or reference to any of its choice of laws or conflicts of laws principles which would require or permit the application of the laws of another jurisdiction. |
| 9. | Assignment, etc. This Agreement may not be assigned by either Party nor may a Party’s duties or obligations hereunder be delegated without the prior written consent of the other Party. This Agreement shall inure to the benefit of, and shall be binding upon, the Parties, their respective successors (whether by merger or consolidation, recapitalization or other similar transaction) and their permitted assignees. |
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| 10. | Drafting History. In resolving any dispute or controversy arising out of or relating to this Agreement or in connection with construing any term or provision in this Agreement, there shall be no presumption made or inference drawn because of the inclusion of a provision not contained in a prior draft or the deletion of a provision contained in a prior draft. The Parties acknowledge and agree that this Agreement was negotiated and drafted with each Party being represented by competent legal counsel of its choice and with each Party having an opportunity to participate in the drafting of the provisions hereof and shall therefore this Agreement shall be construed and interpreted as if drafted jointly by the Parties and not with any presumption against either of the Parties. |
| 11. | Complete Agreement. This Agreement constitutes the entire understanding and agreement of the Parties with respect to the subject matter hereof, and it supersedes all prior and/or contemporaneous understandings and agreements among the Parties, whether oral or written, with respect to such subject matter, all of which are merged herein. There are no representations, warranties, agreements or promises between the Parties with respect to such subject matter, except those which are expressly set forth herein. |
| 12. | Headings, Counterparts. The section headings contained in this Agreement are inserted herein for the purpose of convenience and reference only and they are not to be given any substantive effect, nor shall they be used or have any effect upon the construction or interpretation of any term or provision hereof. Any reference to the masculine, feminine or neuter gender shall be a reference to such other gender as if appropriate. References to the singular shall include the plural and vice versa. This Agreement shall be effective when duly executed counterparts are executed and delivered by each of the Parties. This Agreement may be executed in multiple counterparts (and may be executed by facsimile, PDF or electronic signature, which shall constitute a legal and valid signature for purposes hereof), each of which shall constitute an original, and all of which, when taken together, shall constitute one and the same document. The Parties acknowledge and agree that this Agreement is effective as of its specified date regardless of the fact that it is being executed by either of the Parties on another date (including a later date). Facsimile or PDF counterparts of this Agreement shall be deemed to be considered original and valid counterparts hereof. |
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IN WITNESS WHEREOF, each of the Parties has executed this Agreement as of the date first written above.
| VG LIFE SCIENCES, INC. | |
| By: /s/ John P. Tynan | |
| Name: John P. Tynan | |
| Title: President & CEO |
| DMBM, INC. | |
| By: /s/ Damon R Devitt | |
| Name: Damon R Devitt | |
| Title: President, DMBM Inc. |
| 4 |
Exhibit 10.127
THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AND HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF. NO SUCH SALE OR DISTRIBUTION MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT UNLESS AN EXEMPTION FROM REGISTRATION IS AVAILABLE UNDER THE SECURITIES ACT OF 1933 (THE "SECURITIES ACT").
CONVERTIBLE DEBENTURE
| $24,000.00 | Effective as of December 1, 2013 |
For value received, VG LIFE SCIENCES Inc., (formerly Viral Genetics, Inc.) a Delaware corporation (the "Company"), promises to pay to the order of JTL Enterprises Corp., 1107 38th Avenue, Seattle, WA 98122 (the "Holder"), a New York corporation, the principal sum of TWENTY FOUR THOUSAND DOLLARS AND NO CENTS or the aggregate outstanding principal amount hereof, whichever is less (the “Principal”), represents a series of monthly obligations for services (“Monthly Services”) rendered pursuant to a Consulting Agreement between the parties which remain unpaid (each related to a specific month as per Schedule A) rendered by the Holder to the Company in months between July 2013 and December 2013, inclusive, in the amounts specified on Schedule A attached hereto and to pay interest on the outstanding principal amount of this Convertible Debenture (this "Debenture") as provided herein.
1. Definitions. The following terms shall have the definitions set forth in this Section 1:
| (a) | "Business Day" means any day on which banks are open for business in both the State of California and the State of New York. |
| (b) | "Common Stock" means the Company's common stock, par value $0.0001 per Share, post-split shares. |
| (c) | "Conversion Price" shall be $0.10 per Share. |
| (d) | "Shares" means shares of Common Stock. |
| (e) | "Trading Day" means a calendar day on which the Shares are quoted for trading on the Trading Market. |
| (f) | "Trading Market" means the following markets or exchanges on which the Shares are listed or quoted for trading on the date in question: The Over The Counter Bulletin Board, the PinkSheets, OTCPink , the Nasdaq SmallCap Market, the American Stock Exchange, the New York Stock Exchange, the Nasdaq National Market, the Toronto Stock Exchange, the TSX Venture Exchange, or any other securities exchange registered with the United States Securities and Exchange Commission. |
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2. Monthly Services. Periodic Monthly Services rendered by the Holder to the Company evidenced by this Debenture, shall be set forth on Schedule A attached hereto. The Holder is authorized by the Company to modify Schedule A from time to time to reflect the amount of any partial conversion of this Debenture.
3. Interest. Interest on the outstanding Principal amount of this Debenture will accrue at a rate equal to one percent (1%) per annum from the date of end of each month of Monthly Services as set forth on Schedule A. Interest will be computed on the basis of a year of 12 months, each having 30 days, and will be paid on the Maturity Date and upon any permitted prepayment of this Debenture.
4. Repayment. The Company shall pay the Principal amount of this Debenture, together with all accrued and unpaid interest, to the Holder on November 1, 2014 (the "Maturity Date").
5. Payment. All payments due under this Debenture shall be made in either the lawful money of the United States of America or in Shares, as determined by the Company in its discretion in accordance with Section 5 hereof, without set-off, deduction, demand or notice.
| (a) | Form of Payment. Five (5) business days prior to the Maturity Date, the Company, at its sole discretion, shall notify the Holder whether the payment due on the Maturity Date shall be made in cash or in Shares. |
| (b) | Payment in Cash. All payments in cash shall be made to the Holder by check or by wire transfer to such bank as the Holder may advise the Company in writing. |
| (c) | Payment in Shares. The number of Shares issuable upon a payment being made in Shares shall be calculated by dividing the aggregate amount due on the Maturity Date by the Conversion Price. No fractional Shares will be issued upon conversion of this Debenture or a payment by the Company in Shares. In lieu of any fractional Share to which the Holder would otherwise be entitled upon a payment in Shares, the Company will pay to the Holder in cash the amount of the unpaid or unconverted Principal and interest balance of this Debenture that would otherwise be paid or converted into such fractional Share. Shares issued hereunder shall be transmitted by the transfer agent of the Company to the Holder either by crediting the account of the Holder's designated broker with the Depository Trust Company through its Deposit Withdrawal Agent Commission ("DWAC"), or, if so elected by Holder, by physical delivery of certificates to Holder's address within five (5) Trading Days from the Due Date. If the Company fails for any reason to deliver to the Holder the Shares by the requisite delivery date, the Company shall pay to the Holder, in cash, as liquidated damages and not as a penalty, for each $1,000 of Shares not timely delivered, $5 per Trading Day (increasing to $10 per Trading Day on the fifteenth (15) Trading Day after such liquidated damages begin to accrue) for each Trading Day after such requisite delivery date until such Shares are delivered. In addition to any other rights available to the Holder, if the Company fails to cause its transfer agent to deliver to the Holder the Shares on or before the requisite delivery date, and if after such date the Holder is required by its broker to purchase (in an open market transaction or otherwise), or the Holder's brokerage firm otherwise purchases, Shares to deliver in satisfaction of a sale by the Holder of the Shares which the Holder anticipated receiving pursuant to this Debenture (a "Buy-In"), then the Company shall (1) pay in cash to the Holder the amount by which (x) the Holder's total purchase price (including brokerage commissions, if any) for the Shares so purchased exceeds (y) the amount obtained by multiplying (A) the number of Shares that the Company was required to deliver to the Holder multiplied by (B) the price at which the sell order giving rise to such purchase obligation was executed, and (2) deliver to the Holder the number of Shares that would have been issued had the Company timely complied with its exercise and delivery obligations hereunder. For example, if the Holder purchases Shares having a total purchase price of $11,000 to cover a Buy-In with an aggregate sale price giving rise to such purchase obligation of $10,000, under clause (1) of the immediately preceding sentence the Company shall be required to pay the Holder $ 1,000. The Holder shall provide the Company written notice indicating the amounts payable to the Holder in respect of the Buy-In and, upon request of the Company, commercially reasonable evidence of the amount of such loss. |
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| (d) | Adjustments. If the Company, at any time while this Debenture is outstanding subdivides outstanding Shares into a larger number of shares or combines (including by way of reverse stock split) outstanding Shares into a smaller number of shares, then the Conversion Price shall be multiplied by a fraction of which the numerator shall be the number of Shares outstanding immediately before such event and of which the denominator shall be the number of Shares outstanding immediately after such event. |
6. Prepayment. This Debenture may not be prepaid by the Company without the prior written consent of the Holder, except as provided in Section 7 of this Debenture.
7. Conversion. At any time prior to five (5) business days prior to the Maturity Date, all or any portion of the Principal amount of this Debenture, together will accrued interest thereon, may be converted at the option of the Holder, at any time and from time to time, in the minimum principal amount of $5,000 and integral multiples of $1,000 thereafter, upon not less than two (2) three (3) Business Days after the Company's receipt of the Conversion Notice (as hereinafter defined) from the Holder and payment in full of the Conversion Price as then in effect. Each "Conversion Notice" shall mean a written notice from the Holder informing the Company of the date of the conversion, the principal amount of this Debenture being converted, the number of shares of Common Stock to be received upon conversion and confirming that the Conversion Price will be paid in cash. The Conversion Price shall be paid by certified check or by wire transfer of immediately available funds to a bank account designated by the Company in writing. Within three (3) Business Days after payment of the Conversion Price, the Company will deliver a certificate for the shares of Common Stock issued upon conversion to the Holder, or at the Holder’s request, to a brokerage account for the benefit of Holder. The Company shall at all times reserve for issuance a number of shares of Common Stock sufficient to satisfy the conversion feature of this Debenture. The number of shares of Common Stock issuable upon the conversion of all or a portion of this Debenture shall be equal to the Principal amount of this Debenture being converted divided by the Conversion Price. For purposes hereof, any partial conversion of this Debenture, each Loan shall be considered separate and distinct indebtedness of the Company to the Holder for purposes of determining the holding period of each item of indebtedness represented by the Loan. Notwithstanding anything set forth herein, in no event shall the Holder be entitled to convert for a number of shares of Common Stock in excess of that number of shares of Common Stock which, upon giving effect to such conversion, would cause the aggregate number of shares of Common Stock beneficially owned by the Holder and its affiliates to exceed 9.99% of the outstanding shares of the Common Stock following such conversion. Notwithstanding receipt of a Conversion Notice, the Company shall have the right to prepay this Debenture in the amount being converted if the principal amount to be converted together with accrued interest thereon is paid in immediately available funds within one (1) business day after the date of the
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8. Seniority. The indebtedness represented by this Debenture is and shall be an obligation of the Company ranking senior in right of payment, liquidation and otherwise to any future indebtedness and other obligations of the Company. The Company will not create any indebtedness that is senior in priority to the indebtedness represented by this Debenture.
9. Default. Any one of the following occurrences shall constitute an "Event of Default" under this Debenture:
(a) failure of Company to pay any amount that it payable under this Debenture on the Due Date, provided that such failure is not cured within a grace period of ten (10) calendar days; or
(b) failure to comply with or perform any other agreement or covenant of the Company contained herein, which failure does not otherwise constitute an Event of Default, provided that such failure has not been cured within thirty (30) calendar days written notice by Holder to the Company; or
(c) there shall occur any default or event of default, any similar event, any event that requires the prepayment of borrowed money or permits the acceleration of the maturity thereof, or any event or condition that might become any of the foregoing with notice or the passage of time or both, under the terms of any evidence of indebtedness or other agreement issued or assumed or entered into by the Company, or under the terms of any document or instrument under which any such evidence of indebtedness or other agreement is issued, assumed, secured, or guaranteed, and such event shall continue beyond any applicable notice, grace or cure period, provided that such condition shall not have been cured within thirty (30) calendar days of notice by Holder; or
(d) the Company shall fail to maintain its existence in good standing in its state of incorporation; provided that such condition shall not have been cured within thirty (30) calendar days of notice by Holder; or
(e) a judgment or settlement shall be entered or agreed to in any proceeding which would reasonably be expected to have a material and adverse effect on the ability of the Company to repay this Debenture; or any garnishment, summons, writ of attachment, citation, levy or the like is issued against or served upon Holder for the attachment of any property of the Company in Holder’s possession or control, provided that such condition shall not have been cured within thirty (30) calendar days of notice by Holder of such condition; or
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(f) any Share issued pursuant to this Debenture shall not be duly authorized, validly issued, fully paid or nonassessable, provided that such condition shall not have been cured within ninety (90) calendar days of notice by Holder of such condition; or
(g) the Company shake make a voluntary filing for bankruptcy under Title 11, Chapter 7 of the United States Code; or
(h) there shall be appointed a receiver or trustee to take possession of the property or assets of the Company under Title 11, Chapter 7 of the United States Code.
10. Remedies. Upon the occurrence and during the continuance of an Event of Default, this Debenture and shall become immediately due in full, and unpaid amounts hereunder will accrue interest at the rate equal to the stated rate plus 5.00% per annum, and Holder may exercise any rights and remedies under this Debenture, any Transaction Document or other document or instrument and at law or in equity. The time of payment of this Debenture is also subject to acceleration if an Event of Default occurs. Notwithstanding the foregoing, the entire unpaid Principal sum of this Debenture, together with accrued and unpaid interest thereon, shall become immediately due and payable upon any of the Events of Default set forth in this Debenture.
11. Transfer; Successors and Assigns. The terms and conditions of this Debenture shall inure to the benefit of and be binding upon the respective successors and assigns of the parties. At the election of the Holder, but subject-to compliance with applicable securities laws, this Debenture may be assigned or transferred by the Holder, in whole or in part, upon surrender of this Debenture, duly endorsed, and accompanied by a duly executed written instrument of transfer in customary form, following which a new Debenture for the same principal amount and interest will be issued to, and registered in the name of, the transferee. If less than the entire amount of this Debenture is transferred or assigned, the Company will issue new Debentures to the transferee, in the amount transferred or assigned, and to the Holder, in the remaining Principal amount hereof after the transfer or assignment. This Debenture shall be binding upon and inure to the benefit of the Company and the Holder, their successors and permitted assigns and the transferees of the Holder.
12. Governing Law. This Debenture and all acts and transactions pursuant hereto and the rights and obligations of the Company and the Holder shall be governed, construed and interpreted in accordance with the laws of the State of California, without giving effect to any of its principles of conflicts of law or choice of law principles which would result in the application of the laws of another jurisdiction.
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13. Notices. Any notice required or permitted by this Debenture shall be in writing and shall be deemed sufficient upon receipt, when delivered personally or by courier, overnight delivery service or confirmed facsimile, or 96 hours after being deposited in the U.S. mail as certified or registered mail with postage prepaid, if such notice is addressed to the party to be notified at such party's address or facsimile number as set forth herein or as subsequently modified by written notice.
14. Amendments and Waivers. This Debenture may only be amended, modified or waived by a written instrument executed by the Company and the Holder. Any amendment or waiver effected in accordance with this Section 14 shall be binding upon the Company, the Holder and each transferee or permitted assigns of any Debenture.
15. Loss of Debenture. Upon receipt by the Company of a customary representation by the Holder of the loss, theft, destruction or mutilation of this Debenture or any Debenture exchanged for it, and a customary indemnity undertaking by the Holder (in case of loss, theft or destruction) or surrender and cancellation of such Debenture {in the case of mutilation), the Company will make and deliver in lieu of such Debenture a new Debenture of like tenor.
16. Waiver of Presentment, etc. The Company hereby expressly waives presentment, demand for payment, dishonor, notice of dishonor, protest, notice of protest and any other formality upon the occurrence of an Event of Default.
17. Entire Understanding. This Debenture sets forth the entire understanding agreement of the Company and the Holder with respect to the subject matter hereof and it supersedes all prior and/or contemporaneous understandings and agreements with respect to such subject matter, all of which are merged herein, and it specifically amends and restates a Debenture dated this date in the same principal amount hereof, which did not accurately reflect the understanding and agreement of the Company and the Holder.
18. Costs and Fees. The Company agrees to pay all costs, expenses, including, without limitation, reasonable attorneys' fees and disbursements, incurred by the Holder in endeavoring to collect any amounts payable hereunder (including, without limitation, amounts payable in Shares) which are not paid when due or otherwise in enforcing any provision of this Debenture and any of the rights and remedies of the Holder under this Debenture, at law or in equity.
[signature page follows]
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IN WITNESS WHEREOF, this Debenture has been executed by a duly authorized officer of the Company as of the date first written above.
| COMPANY | |
| VG LIFE SCIENCES INC. | |
| (FORMERLY VIRAL GENETICS, INC.) | |
| /s/ John P. Tynan | |
| John P. Tynan | |
| President |
| 7 |
NOTICE OF CONVERSION
CONVETIBLE DEBENTURE
(Date)
VG Life Sciences Inc.
121 Gray Avenue
Santa Barbara, CA 93101
Dear Mr. Keledjian,
JTL Enterprises Corp (JTL) is the holder of a Convertible Debenture dated December 1, 2013 (the “Debenture”) in the amount of $24,000 made and issued by VG Life Sciences Inc. (“VGLS”), a Delaware corporation in favor of JTL.
This letter shall constitute notice to VGLS that JTL does hereby exercise its right to take payment of the outstanding principal amount of the Debenture, or the amount of $____________, in shares of VGLS
common stock at a price of $0.10 per share. This will leave the remainder of $____________, still due and payable under this December 1, 2013 convertible debenture.
Please have the _____________ shares issued in the names of Myron Landin (60% share) and Samuel Zemsky (40% share) in accordance with the terms and provisions of our agreement. JTL is not and never has been a 5% of 10% holder of VGLS common stock.
Very truly yours,
/s/ Myron W. Landin
Myron W. Landin
President
JTL Enterprises Corp.
1107 38th Avenue
Seattle, WA 98122
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Schedule A
December 1, 2013
| Month of Services | Monthly Services Fee | |||
| July 2013 | $ | 4,000.00 | ||
| August 2013 | 4,000.00 | |||
| Sept 2013 | 4,000.00 | |||
| Oct 2013 | 4,000.00 | |||
| Nov 2013 | 4,000.00 | |||
| Dec 2013 | 4,000.00 | |||
| $ | 24,000.00 | |||
| 9 |
Exhibit 10.128
THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AND HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF. NO SUCH SALE OR DISTRIBUTION MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT UNLESS AN EXEMPTION FROM REGISTRATION IS AVAILABLE UNDER THE SECURITIES ACT OF 1933 (THE "SECURITIES ACT").
CONVERTIBLE DEBENTURE
| $11,250.00 | Effective as of December 31, 2013 |
For value received, VG LIFE SCIENCES Inc., (formerly Viral Genetics, Inc.) a Delaware corporation (the "Company"), promises to pay to the order of JTL Enterprises Corp., 1107 38th Avenue, Seattle, WA 98122 (the "Holder"), a New York corporation, the principal sum of ELEVEN THOUSAND TWO HUNDRED AND FIFTY DOLLARS AND NO CENTS or the aggregate outstanding principal amount hereof, whichever is less (the “Principal”), represents an obligation for a portion of Services rendered pursuant to a Consulting Services Agreement effective as of January 1, 2013 between the parties which remain unpaid by the Holder, to the Company in the year ended December 31, 2013, and to pay interest on the outstanding principal amount of this Convertible Debenture (this "Debenture") as provided herein.
1. Definitions. The following terms shall have the definitions set forth in this Section 1:
| (a) | "Business Day" means any day on which banks are open for business in both the State of California and the State of New York. |
| (b) | "Common Stock" means the Company's common stock, par value $0.0001 per Share, post-split shares. |
| (c) | "Conversion Price" shall be $0.10 per Share. |
| (d) | "Shares" means shares of Common Stock. |
| (e) | "Trading Day" means a calendar day on which the Shares are quoted for trading on the Trading Market. |
| (f) | "Trading Market" means the following markets or exchanges on which the Shares are listed or quoted for trading on the date in question: The Over The Counter Bulletin Board, the PinkSheets, OTCPink , the Nasdaq SmallCap Market, the American Stock Exchange, the New York Stock Exchange, the Nasdaq National Market, the Toronto Stock Exchange, the TSX Venture Exchange, or any other securities exchange registered with the United States Securities and Exchange Commission. |
2. Services. Services rendered by the Holder to the Company evidenced by this Debenture, shall be as specified in the aforementioned Consulting Services Agreement.
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3. Interest. Interest on the outstanding Principal amount of this Debenture will accrue at a rate equal to one percent (1%) per annum from the date 30 days after the date hereof. Interest will be computed on the basis of a year of 12 months, each having 30 days, and will be paid on the Maturity Date and upon any permitted prepayment of this Debenture.
4. Repayment. The Company shall pay the Principal amount of this Debenture, together with all accrued and unpaid interest, to the Holder on December 31, 2014 (the "Maturity Date").
5. Payment. All payments due under this Debenture shall be made in either the lawful money of the United States of America or in Shares, as determined by the Company in its discretion in accordance with Section 5 hereof, without set-off, deduction, demand or notice.
| (a) | Form of Payment. Five (5) business days prior to the Maturity Date, the Company, at its sole discretion, shall notify the Holder whether the payment due on the Maturity Date shall be made in cash or in Shares. |
| (b) | Payment in Cash. All payments in cash shall be made to the Holder by check or by wire transfer to such bank as the Holder may advise the Company in writing. |
| (c) | Payment in Shares. The number of Shares issuable upon a payment being made in Shares shall be calculated by dividing the aggregate amount due on the Maturity Date by the Conversion Price. No fractional Shares will be issued upon conversion of this Debenture or a payment by the Company in Shares. In lieu of any fractional Share to which the Holder would otherwise be entitled upon a payment in Shares, the Company will pay to the Holder in cash the amount of the unpaid or unconverted Principal and interest balance of this Debenture that would otherwise be paid or converted into such fractional Share. Shares issued hereunder shall be transmitted by the transfer agent of the Company to the Holder either by crediting the account of the Holder's designated broker with the Depository Trust Company through its Deposit Withdrawal Agent Commission ("DWAC"), or, if so elected by Holder, by physical delivery of certificates to Holder's address within five (5) Trading Days from the Due Date. If the Company fails for any reason to deliver to the Holder the Shares by the requisite delivery date, the Company shall pay to the Holder, in cash, as liquidated damages and not as a penalty, for each $1,000 of Shares not timely delivered, $5 per Trading Day (increasing to $10 per Trading Day on the fifteenth (15) Trading Day after such liquidated damages begin to accrue) for each Trading Day after such requisite delivery date until such Shares are delivered. In addition to any other rights available to the Holder, if the Company fails to cause its transfer agent to deliver to the Holder the Shares on or before the requisite delivery date, and if after such date the Holder is required by its broker to purchase (in an open market transaction or otherwise), or the Holder's brokerage firm otherwise purchases, Shares to deliver in satisfaction of a sale by the Holder of the Shares which the Holder anticipated receiving pursuant to this Debenture (a "Buy-In"), then the Company shall (1) pay in cash to the Holder the amount by which (x) the Holder's total purchase price (including brokerage commissions, if any) for the Shares so purchased exceeds (y) the amount obtained by multiplying (A) the number of Shares that the Company was required to deliver to the Holder multiplied by (B) the price at which the sell order giving rise to such purchase obligation was executed, and (2) deliver to the Holder the number of Shares that would have been issued had the Company timely complied with its exercise and delivery obligations hereunder. For example, if the Holder purchases Shares having a total purchase price of $11,000 to cover a Buy-In with an aggregate sale price giving rise to such purchase obligation of $10,000, under clause (1) of the immediately preceding sentence the Company shall be required to pay the Holder $ 1,000. The Holder shall provide the Company written notice indicating the amounts payable to the Holder in respect of the Buy-In and, upon request of the Company, commercially reasonable evidence of the amount of such loss. |
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| (d) | Adjustments. If the Company, at any time while this Debenture is outstanding subdivides outstanding Shares into a larger number of shares or combines (including by way of reverse stock split) outstanding Shares into a smaller number of shares, then the Conversion Price shall be multiplied by a fraction of which the numerator shall be the number of Shares outstanding immediately before such event and of which the denominator shall be the number of Shares outstanding immediately after such event. |
6. Prepayment. This Debenture may not be prepaid by the Company without the prior written consent of the Holder, except as provided in Section 7 of this Debenture.
7. Conversion. At any time prior to five (5) business days prior to the Maturity Date, all or any portion of the Principal amount of this Debenture, together will accrued interest thereon, may be converted at the option of the Holder, at any time and from time to time, in the minimum principal amount of $5,000 and integral multiples of $1,000 thereafter, upon not less than two (2) three (3) Business Days after the Company's receipt of the Conversion Notice (as hereinafter defined) from the Holder and payment in full of the Conversion Price as then in effect. Each "Conversion Notice" shall mean a written notice from the Holder informing the Company of the date of the conversion, the principal amount of this Debenture being converted, the number of shares of Common Stock to be received upon conversion and confirming that the Conversion Price will be paid in cash. The Conversion Price shall be paid by certified check or by wire transfer of immediately available funds to a bank account designated by the Company in writing. Within three (3) Business Days after payment of the Conversion Price, the Company will deliver a certificate for the shares of Common Stock issued upon conversion to the Holder, or at the Holder’s request, to a brokerage account for the benefit of Holder. The Company shall at all times reserve for issuance a number of shares of Common Stock sufficient to satisfy the conversion feature of this Debenture. The number of shares of Common Stock issuable upon the conversion of all or a portion of this Debenture shall be equal to the Principal amount of this Debenture being converted divided by the Conversion Price. For purposes hereof, any partial conversion of this Debenture, each Loan shall be considered separate and distinct indebtedness of the Company to the Holder for purposes of determining the holding period of each item of indebtedness represented by the Loan. Notwithstanding anything set forth herein, in no event shall the Holder be entitled to convert for a number of shares of Common Stock in excess of that number of shares of Common Stock which, upon giving effect to such conversion, would causethe aggregate number of shares of Common Stock beneficially owned by the Holder and its affiliates to exceed 9.99% of the outstanding shares of the Common Stock following such conversion. Notwithstanding receipt of a Conversion Notice, the Company shall have the right to prepay this Debenture in the amount being converted if the principal amount to be converted together with accrued interest thereon is paid in immediately available funds within one (1) business day after the date of the
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8. Seniority. The indebtedness represented by this Debenture is and shall be an obligation of the Company ranking senior in right of payment, liquidation and otherwise to any future indebtedness and other obligations of the Company. The Company will not create any indebtedness that is senior in priority to the indebtedness represented by this Debenture.
9. Default. Any one of the following occurrences shall constitute an "Event of Default" under this Debenture:
(a) failure of Company to pay any amount that it payable under this Debenture on the Due Date, provided that such failure is not cured within a grace period of ten (10) calendar days; or
(b) failure to comply with or perform any other agreement or covenant of the Company contained herein, which failure does not otherwise constitute an Event of Default, provided that such failure has not been cured within thirty (30) calendar days written notice by Holder to the Company; or
(c) there shall occur any default or event of default, any similar event, any event that requires the prepayment of borrowed money or permits the acceleration of the maturity thereof, or any event or condition that might become any of the foregoing with notice or the passage of time or both, under the terms of any evidence of indebtedness or other agreement issued or assumed or entered into by the Company, or under the terms of any document or instrument under which any such evidence of indebtedness or other agreement is issued, assumed, secured, or guaranteed, and such event shall continue beyond any applicable notice, grace or cure period, provided that such condition shall not have been cured within thirty (30) calendar days of notice by Holder; or
(d) the Company shall fail to maintain its existence in good standing in its state of incorporation; provided that such condition shall not have been cured within thirty (30) calendar days of notice by Holder; or
(e) a judgment or settlement shall be entered or agreed to in any proceeding which would reasonably be expected to have a material and adverse effect on the ability of the Company to repay this Debenture; or any garnishment, summons, writ of attachment, citation, levy or the like is issued against or served upon Holder for the attachment of any property of the Company in Holder’s possession or control, provided that such condition shall not have been cured within thirty (30) calendar days of notice by Holder of such condition; or
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(f) any Share issued pursuant to this Debenture shall not be duly authorized, validly issued, fully paid or nonassessable, provided that such condition shall not have been cured within ninety (90) calendar days of notice by Holder of such condition; or
(g) the Company shake make a voluntary filing for bankruptcy under Title 11, Chapter 7 of the United States Code; or
(h) there shall be appointed a receiver or trustee to take possession of the property or assets of the Company under Title 11, Chapter 7 of the United States Code.
10. Remedies. Upon the occurrence and during the continuance of an Event of Default, this Debenture and shall become immediately due in full, and unpaid amounts hereunder will accrue interest at the rate equal to the stated rate plus 5.00% per annum, and Holder may exercise any rights and remedies under this Debenture, any Transaction Document or other document or instrument and at law or in equity. The time of payment of this Debenture is also subject to acceleration if an Event of Default occurs. Notwithstanding the foregoing, the entire unpaid Principal sum of this Debenture, together with accrued and unpaid interest thereon, shall become immediately due and payable upon any of the Events of Default set forth in this Debenture.
11. Transfer; Successors and Assigns. The terms and conditions of this Debenture shall inure to the benefit of and be binding upon the respective successors and assigns of the parties. At the election of the Holder, but subject-to compliance with applicable securities laws, this Debenture may be assigned or transferred by the Holder, in whole or in part, upon surrender of this Debenture, duly endorsed, and accompanied by a duly executed written instrument of transfer in customary form, following which a new Debenture for the same principal amount and interest will be issued to, and registered in the name of, the transferee. If less than the entire amount of this Debenture is transferred or assigned, the Company will issue new Debentures to the transferee, in the amount transferred or assigned, and to the Holder, in the remaining Principal amount hereof after the transfer or assignment. This Debenture shall be binding upon and inure to the benefit of the Company and the Holder, their successors and permitted assigns and the transferees of the Holder.
12. Governing Law. This Debenture and all acts and transactions pursuant hereto and the rights and obligations of the Company and the Holder shall be governed, construed and interpreted in accordance with the laws of the State of California, without giving effect to any of its principles of conflicts of law or choice of law principles which would result in the application of the laws of another jurisdiction.
13. Notices. Any notice required or permitted by this Debenture shall be in writing and shall be deemed sufficient upon receipt, when delivered personally or by courier, overnight delivery service or confirmed facsimile, or 96 hours after being deposited in the U.S. mail as certified or registered mail with postage prepaid, if such notice is addressed to the party to be notified at such party's address or facsimile number as set forth herein or as subsequently modified by written notice.
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14. Amendments and Waivers. This Debenture may only be amended, modified or waived by a written instrument executed by the Company and the Holder. Any amendment or waiver effected in accordance with this Section 14 shall be binding upon the Company, the Holder and each transferee or permitted assigns of any Debenture.
15. Loss of Debenture. Upon receipt by the Company of a customary representation by the Holder of the loss, theft, destruction or mutilation of this Debenture or any Debenture exchanged for it, and a customary indemnity undertaking by the Holder (in case of loss, theft or destruction) or surrender and cancellation of such Debenture {in the case of mutilation), the Company will make and deliver in lieu of such Debenture a new Debenture of like tenor.
16. Waiver of Presentment, etc. The Company hereby expressly waives presentment, demand for payment, dishonor, notice of dishonor, protest, notice of protest and any other formality upon the occurrence of an Event of Default.
17. Entire Understanding. This Debenture sets forth the entire understanding agreement of the Company and the Holder with respect to the subject matter hereof and it supersedes all prior and/or contemporaneous understandings and agreements with respect to such subject matter, all of which are merged herein, and it specifically amends and restates a Debenture dated this date in the same principal amount hereof, which did not accurately reflect the understanding and agreement of the Company and the Holder.
18. Costs and Fees. The Company agrees to pay all costs, expenses, including, without limitation, reasonable attorneys' fees and disbursements, incurred by the Holder in endeavoring to collect any amounts payable hereunder (including, without limitation, amounts payable in Shares) which are not paid when due or otherwise in enforcing any provision of this Debenture and any of the rights and remedies of the Holder under this Debenture, at law or in equity.
[signature page follows]
| 6 |
IN WITNESS WHEREOF, this Debenture has been executed by a duly authorized officer of the Company as of the date first written above.
| COMPANY | |
| VG LIFE SCIENCES INC. | |
| (FORMERLY VIRAL GENETICS, INC.) | |
| By: /s/ John P. Tynan John P. Tynan | |
| President |
| 7 |
NOTICE OF CONVERSION
CONVETIBLE DEBENTURE
(Date)
VG Life Sciences Inc.
121 Gray Avenue
Santa Barbara, CA 93101
Dear Mr. Tynan,
JTL Enterprises Corp (JTL) is the holder of a Convertible Debenture dated December 31, 2013 (the “Debenture”) in the amount of $11,250 made and issued by VG Life Sciences Inc. (“VGLS”), a Delaware corporation in favor of JTL.
This letter shall constitute notice to VGLS that JTL does hereby exercise its right to take payment of the outstanding principal amount of the Debenture, or the amount of $____________, in shares of VGLS common stock at a price of $0.10 per share. This will leave the remainder of $__________, still due and payable under this December 31, 2013 convertible debenture.
Please have the____________ shares issued in the names of Myron Landin (60% share) and Samuel Zemsky (40% share) in accordance with the terms and provisions of our agreement. JTL is not and never has been a 5% of 10% holder of VGLS common stock.
Very truly yours,
/s/ Myron W. Landin
Myron W. Landin
President
JTL Enterprises Corp.
1107 38th Avenue
Seattle, WA 98122
631 897 3145
| 8 |
Exhibit 10.131
CONVERTIBLE PROMISSORY NOTE
AND WARRANT PURCHASE AGREEMENT
THIS CONVERTIBLE PROMISSORY NOTE AND WARRANT PURCHASE AGREEMENT is made as of January 24, 2014 by and between KED Consulting Group LLC, (the “Investor”) and VG Life Sciences, Inc. (the "Company" or “VGLS”).
THE PARTIES HEREBY AGREE AS FOLLOWS:
1. Purchase and Sale of Notes.
1.1 Purchase and Sale of Note. Subject to the terms and conditions of this Agreement and pursuant to a promissory note in the form attached hereto as Exhibit A (the "Note"), the Investor agrees to purchase at the Closing and the Company agrees to sell and issue to the Investor at the Closing a Note in the principal amount of Two Hundred Seventy Thousand Dollars ($270,000 at a price equal to one hundred percent (100%) of the principal amount thereof (the "Investment"). For clarification, there are two payment schedules. $170,000.00 will be made in six (6) equal monthly installments of $28,333.33 beginning January 30, 2014 and ending June 30, 2014 by wire to VGLS. The remaining $100,000 will be paid directly to Martin Eric Weisberg, 3 Powder Hill Road, Waccabuc New York 10597. Both the Note and the Warrant (as defined in Section 1.2 below) include a cashless exercise feature enabling conversion into unregistered shares (“Shares”) of common stock of VGLS based on the spread between the warrant exercise price and the then-trading value of the underlying VGLS Shares. The Note is convertible into Shares at a conversion rate equal to the lowest three-day average closing price of the Shares starting on July 16, 2013 and ending on September 15, 2013 (the “Period”), minus a ten percent (10%) discount. The Note will be convertible into Shares in four equal tranches (25% each) on the following dates: December 15, 2014, March 15, 2015, June 15, 2015, and September 15, 2015. The Note carries an eight percent (8%) per annum interest, is automatically converted into Shares after the lapse of one year, and will not be prepayable at any time by VGLS.
1.2 Purchase and Sale of Warrant. Subject to the terms and conditions of this Agreement, the Investor agrees to purchase and the Company agrees to sell and issue to the Investor at the Closing, a warrant in the form attached hereto as Exhibit B (the "Warrant") to purchase shares of a series of the Company's Common Stock. In addition to the Notes, Investor will receive warrant coverage (“Warrants”) for 1,080,000 Shares at $0.45 per Share, which includes a cashless exercise feature. The Warrants will be exercisable on any date from and including the four-year anniversary of the date of this Agreement and the five-year anniversary thereof.
1.3 Closing.
(a) The purchase and sale of the Note and Warrant shall take place at the offices of Investor at 10:00 A.M. between January 1, 2014 and January 31, 2014, or at such other time and place as the Company and the Investor may determine (the "Closing").
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(b) At the Closing, the Company shall deliver to the Investor a Note representing the principal amount as is prescribed in Section 1.1 above and the Investor shall cause to be delivered to the Company a wire transfer to the Company's order in the aggregate amount of the principal amount of the Investment as is prescribed in Section 1.1 above.
2. Representations, Warranties, and Covenants of the Company. The Company hereby represents and warrants to the Investor that:
2.1 Organization, Good Standing and Qualification. The Company is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware and has all requisite corporate power and authority to carry on its business as now conducted and proposed to be conducted. The Company is duly qualified to transact business and is in good standing in each jurisdiction in which the failure to so qualify would have a material adverse effect on its business or properties.
2.2 Authorization. All corporate actions on the part of the Company, its officers, directors and stockholders necessary for the authorization, execution and delivery of this Agreement, the performance of all obligations of the Company hereunder and the authorization, issuance and delivery of the Note and the Warrant have been taken or will be taken prior to the Closing. This Agreement constitutes, and the Note and the Warrant when executed and delivered in accordance with their terms will constitute, valid and legally binding obligations of the Company, enforceable in accordance with their respective terms except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium, and other laws of general application affecting enforcement of creditors' rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies and (iii) as limited by applicable usury laws.
2.3 Compliance with Other Instruments. The Company is not in violation or default of any provisions of its Articles of Incorporation, as amended (the "Articles"), or Bylaws (the "Bylaws"), or, except as set forth on Schedule 1 hereof, in any material respect of any provision of a mortgage, indenture, agreement, instrument or contract to which it is a party or by which it is bound or of any federal or state judgment order, writ or decree, or, to its knowledge, of any statute, rule or regulation applicable to the Company. The execution, delivery and performance by the Company of this Agreement, and the consummation of the transactions contemplated hereby, including the issuance and delivery of the Note and the Warrant, will not result in any such violation or be in material conflict with or constitute, with or without the passage of time or giving of notice, either a material default under any such provision or an event that results in the creation of any material lien, charge or encumbrance upon any assets of the Company or the suspension, revocation, impairment, forfeiture, or nonrenewal of any material permit, license, authorization, or approval applicable to the Company, its business or operations, or any of its assets or properties.
2.4 Governmental Consents. Based in part upon the representations and warranties of the Investor in Section 3, no consent, approval, order or authorization of, or registration, qualification, designation, declaration or filing with, any federal, state or local governmental authority on the part of the, Company is required in connection with the consummation of the transactions contemplated by this Agreement, except such post-closing filings as may be required under applicable federal and state securities laws, which will be timely filed within the applicable period therefor.
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2.5 Sufficient Authorized Shares. The number of authorized but unissued shares of the Company's Common Stock will be sufficient to permit conversion of the Note and the exercise of the Warrant. From the date hereof, the Company shall at all times maintain a sufficient quantity of authorized but unissued shares of Common Stock sufficient to permit conversion of the Note and the exercise of the Warrant. In the event the Company, for any reason, no longer has a sufficient number of authorized but unissued shares to comply with this Section 2.5, it shall use its best efforts to promptly authorize such shares. Upon the issuance of shares of Common Stock pursuant to the conversion of the Note and/or the exercise of the Warrant, such shares of Common Stock shall be duly and validly issued, fully paid and nonassessable, and issued in compliance with all applicable securities laws, as then in effect, of the United States and each of the states whose securities laws govern the issuance of the Note and/or the Warrant pursuant to this Agreement and shall not be issued in violation of any preemptive or similar right.
2.6 No Brokers. No broker or finder has acted directly or indirectly for the Company in connection with the transactions contemplated by this Agreement, and no broker or finder is entitled to any brokerage, finder's or other fee or commission in respect thereof based in any way on agreements, arrangements or understandings made by or on behalf of the Company and the Investor or the transactions contemplated hereby.
2.7 Minute Books. The Company has made available to the Investor (and will continue to make available up to the Closing) copies of the minute books of the Company. The minute books contains records of all written actions and meetings of the Board of Directors and there have been no written actions or meetings of the Board of Directors since the date of the last meeting in the minute books.
3. Representations and Warranties of the Investor. The Investor represents and warrants severally and not jointly, with respect to the Investor, that:
3.1 Authorization. The Investor has full capacity, power and authority to enter into and perform this Agreement, and all actions necessary to authorize the execution, delivery and performance of this Agreement have been taken prior to the Closing. This Agreement constitutes a valid and legally binding obligation of the Investor, enforceable in accordance with its terms, except as the same may be limited by bankruptcy, insolvency, moratorium, and other laws of general application affecting the enforcement of creditors' rights generally.
3.2 Receipt of Information. The Investor believes it, he or she has received all the information necessary or appropriate for deciding whether to acquire the Securities. The Investor further represents that the Investor has had an opportunity to ask questions and receive answers from the Company regarding the terms and conditions of the offering of the Securities.
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3.3 Timely Payment. If a monthly installment payment is more than five days late, a penalty for any Investor late payment will be $1,000 per day, provided the Company is current in its financial filing obligations. Failure to pay within 10 days of the monthly due date (30th of each month) will make all outstanding installment payments due immediately, provided the company is current in its financial filing obligations.
3.4 Investment Experience. The Investor is an investor in securities of companies in the development stage and acknowledges that the Investor is able to fend for itself, herself or himself, can bear the economic risk of its, his or her investment and has such knowledge and experience in financial or business matters that the Investor is capable of evaluating the merits and risks of the investment in the Securities. If other than an individual, the Investor also represents it has not been organized for the purpose of acquiring the Securities. The Investor further represents that the information provided on Investor's counterpart signature page is true and accurate.
3.5 Restricted Securities. The Investor understands that the Securities are characterized as "restricted securities" under the federal securities laws inasmuch as they are being acquired from the Company in a transaction not involving a public offering and that under such laws and applicable regulations such securities may be resold without registration under the Securities Act of 1933, as amended (the "Securities Act") only in certain limited circumstances. In connection therewith, each lender represents that it is familiar with Rule 144 under the Securities Act, as presently in effect, and understands the resale limitations imposed thereby and by the Securities Act.
3.6 Legends. To the extent applicable, each certificate or other document evidencing any of the Securities shall be endorsed with the legend set forth below, and the Investor covenants that, except to the extent such restrictions are waived by the Company, the Investor shall not transfer the Securities represented by any such certificate without complying with the restrictions on transfer described in the legends endorsed on such certificate:
"THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED, PLEDGED, OR HYPOTHECATED ABSENT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT OR COMPLIANCE WITH RULE 144 PROMULGATED UNDER SUCH ACT, OR UNLESS THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY AND ITS COUNSEL, THAT SUCH REGISTRATION IS NOT REQUIRED."
4. Conditions of Investor's Obligations. The obligations of the Investor hereunder are subject to the fulfillment on or before the Closing of each of the following conditions:
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4.1 Representations and Warranties. The representations and warranties of the Company contained in Section 2 shall be true on and as of the Closing with the same effect as though such representations and warranties had been made on and as of the date of such Closing.
4.2 Performance. The Company shall have performed and complied with all agreements, obligations and conditions contained in this Agreement that are required to be performed or complied with by it on or before the Closing.
4.3 Board Actions. The Company shall have delivered to the Investor, within 10 business days upon receiving the notice of conversion, resolutions duly adopted by the Company's Board of Directors and, to the extent required by applicable law or by the Company's Articles of Incorporation, the Company's Shareholders, and certified by the Secretary of the Company (i) approving and authorizing the Company's execution and delivery of this Agreement, the Note and the Warrant, and the Company's performance thereunder, and (ii) authorizing the reservation of a sufficient number of shares of the Company's Common Stock to permit the conversion of the Note and to permit the exercise of the Warrant.
5. Conditions of the Company's Obligations. The obligations of the Company with respect to the Investor under this Agreement are subject to the fulfillment on or before the Closing of each of the following conditions:
5.1 Representations and Warranties. The representations and warranties of the Investor contained in Section 3 and on the Investor's signature page shall be true on and as of the Closing with the same effect as though such representations and warranties had been made on and as of the Closing.
5.2 Delivery of Principal. The Investor shall have delivered the principal amount of the Investor's Investment as is prescribed in Section 1.1.
6. Post-Closing Covenant of Company. During such times as the Note is outstanding, the Company shall provide the Investor with a reasonable updates of the Company's actual and forecasted cash position and of any reasonably significant development related to the Company or its business. Such weekly updates shall be transmitted to the Investor via facsimile or via e-mail, at a facsimile number or e-mail address provided by the Investor.
7. Events of Default.
Upon the occurrence of any of the following specified events (each an "Event of Default"), unless such Event of Default shall have been waived or cured prior to the exercise of the remedies set forth below:
7.1 Payments. Any default by the Company in the payment when due of any principal and unpaid accrued interest under any Note if such default is not cured by the Company within ten (10) days after the holder of such Note has given the Company written notice of such default;
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7.2 Representations and Warranties. Any representation or warranty made by the Company herein shall prove to have been incorrect in any material respect on or as of the date made and remains unremedied for a period of thirty (30) days after any Investor provides the Company with written notice of such breach;
7.3 Post Closing Covenants. The failure of Company to satisfy any of the post-closing covenants set forth in Section 6 hereof within the time-periods set forth therein.
7.4 Institution of Bankruptcy Proceedings. The institution by the Company of proceedings to be adjudicated as bankrupt or insolvent, or the consent by it to institution of bankruptcy or insolvency proceedings against it or the filing by it of a petition or answer or consent seeking reorganization or release under the federal Bankruptcy Act, or any other applicable federal or state law, or the consent by it to the filing of any such petition or the appointment of a receiver, liquidator, assignee, trustee, or other similar official, of the Company, or of any substantial part of its property, or the making by it of an assignment for the benefit of creditors, or the taking of corporate action by the Company in furtherance of any such action; or
7.5 Continuation of Bankruptcy Proceedings. If, within thirty (30) days after the commencement of an action against the Company (and service of process in connection therewith on the Company) seeking any bankruptcy, insolvency, reorganization, liquidation, dissolution or similar relief under any present or future statute, law or regulation, such action shall not have been resolved in favor of the Company or all orders or proceedings thereunder affecting the operations or the business of the Company stayed, or if the stay of any such order or proceeding shall thereafter be set aside, or if, within thirty (30) days after the appointment without the consent or acquiescence of the Company of any trustee, receiver or liquidator of the Company or of all or any substantial part of the properties of the Company, such appointment shall not have been vacated;
Then, and in any such event, and at any time thereafter, if any events shall be continuing, the Investor shall have the option to declare the principal amount of the Note, and all accrued but unpaid interest thereon, to be immediately due and payable upon written notice to the Company.
8. Miscellaneous.
8.1 Successors and Assigns. Except as otherwise provided herein, the terms and conditions of this Agreement shall inure to the benefit of and be binding upon the respective successors and assigns of the parties (including transferees of any securities). Nothing in this Agreement, express or implied, is intended to confer upon any party other than the parties hereto or their respective successors and assigns any rights, remedies, obligations, or liabilities under or by reason of this Agreement, except as expressly provided in this Agreement.
8.2 Governing Law. This Agreement shall be governed by and construed under the laws of the State of California, without giving effect to principles of conflict of laws.
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8.3 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.
8.4 Titles and Subtitles. The titles and subtitles used in this Agreement are
used for convenience only and are not to be considered in construing or interpreting this Agreement.
8.5 Notices. Unless otherwise provided, any notice required or permitted
under this Agreement shall be given in writing and shall be deemed effectively given upon personal delivery to the party to be notified or four (4) days after deposit with the United States Post Office, by registered or certified mail, postage prepaid and addressed to the party to be notified at the address indicated for such party on the signature page hereof, or at such other address as such party may designate by advance written notice to the other parties.
8.6 Finder's Fee. Each party represents that it neither is nor will be
obligated for any finders' fee or commission in connection with this transaction.
8.7 Entire Agreement. This Agreement and the other documents delivered
pursuant hereto constitute the entire agreement among the parties and no party shall be liable or bound to any other party in any manner by any warranties, representations, or covenants except as specifically set forth herein or therein.
8.8 Amendment and Waiver. Any term of this Agreement may be
amended and the observance of any term of this Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively), with the written consent of the Company and the Investor. This provision shall not affect the amendment and waiver provisions of the Note. Any waiver or amendment effected in accordance with this section shall be binding upon each holder of any Securities purchased under this Agreement at the time outstanding, each future holder of all such Securities, and the Company.
8.9 Severability. If one or more provisions of this Agreement are held to
be unenforceable under applicable law, such provision shall be excluded from this Agreement and the balance of the Agreement shall be interpreted as if such provision were so excluded and shall be enforceable in accordance with its terms.
8.10 Survival. The representations, warranties, covenants and agreements made herein shall survive the Closing for a period of 12 months.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written.
VG Life Sciences, Inc.
By: /s/ John P. Tynan
Name: John P. Tynan
Title: President & CEO
KED Consulting Group LLC
By: /s/ Ken Kopf
Name: Ken Kopf
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EXHIBIT A
CONVERTIBLE PROMISSORY NOTE
SEE ATTACHED.
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EXHIBIT B
WARRANT TO PURCHASE COMMON STOCK
SEE ATTACHED.
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Exhibit 10.132
THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AND HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF. NO SUCH SALE OR DISTRIBUTION MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT UNLESS AN EXEMPTION FROM REGISTRATION IS AVAILABLE UNDER THE SECURITIES ACT OF 1933 (THE "SECURITIES ACT").
CONVERTIBLE DEBENTURE
| $5,000.00 | Effective as of January 31, 2014 |
For value received, VG LIFE SCIENCES Inc., (formerly Viral Genetics, Inc.) a Delaware corporation (the "Company"), promises to pay to the order of JTL Enterprises Corp., 1107 38th Avenue, Seattle, WA 98122 (the "Holder"), a New York corporation, the principal sum of FIVE THOUSAND DOLLARS AND NO CENTS or the aggregate outstanding principal amount hereof, whichever is less (the “Principal”), represents an obligation for certain services rendered pursuant to a Consulting Services Agreement dated February 11, 2014 between the parties which remain unpaid (as per Schedule A) rendered by the Holder to the Company in the month of January 2014, and to pay interest on the outstanding principal amount of this Convertible Debenture (this "Debenture") as provided herein.
1. Definitions. The following terms shall have the definitions set forth in this Section 1:
| (a) | "Business Day" means any day on which banks are open for business in both the State of California and the State of New York. |
| (b) | "Common Stock" means the Company's common stock, par value $0.0001 per Share, post-split shares. |
| (c) | "Conversion Price" shall be $0.10 per Share. |
| (d) | "Shares" means shares of Common Stock. |
| (e) | "Trading Day" means a calendar day on which the Shares are quoted for trading on the Trading Market. |
| (f) | "Trading Market" means the following markets or exchanges on which the Shares are listed or quoted for trading on the date in question: The Over The Counter Bulletin Board, the PinkSheets, OTCPink , the Nasdaq SmallCap Market, the American Stock Exchange, the New York Stock Exchange, the Nasdaq National Market, the Toronto Stock Exchange, the TSX Venture Exchange, or any other securities exchange registered with the United States Securities and Exchange Commission. |
2. Services. Services rendered by the Holder to the Company evidenced by this Debenture, shall be set forth on aforementioned Consulting Services Agreement.
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3. Interest. Interest on the outstanding Principal amount of this Debenture will accrue at a rate equal to one percent (1%) per annum from the date of end of each month of Monthly Services as set forth on Schedule A. Interest will be computed on the basis of a year of 12 months, each having 30 days, and will be paid on the Maturity Date and upon any permitted prepayment of this Debenture.
4. Repayment. The Company shall pay the Principal amount of this Debenture, together with all accrued and unpaid interest, to the Holder on February 1, 2015 (the "Maturity Date").
5. Payment. All payments due under this Debenture shall be made in either the lawful money of the United States of America or in Shares, as determined by the Company in its discretion in accordance with Section 5 hereof, without set-off, deduction, demand or notice.
| (a) | Form of Payment. Five (5) business days prior to the Maturity Date, the Company, at its sole discretion, shall notify the Holder whether the payment due on the Maturity Date shall be made in cash or in Shares. |
| (b) | Payment in Cash. All payments in cash shall be made to the Holder by check or by wire transfer to such bank as the Holder may advise the Company in writing. |
| (c) | Payment in Shares. The number of Shares issuable upon a payment being made in Shares shall be calculated by dividing the aggregate amount due on the Maturity Date by the Conversion Price. No fractional Shares will be issued upon conversion of this Debenture or a payment by the Company in Shares. In lieu of any fractional Share to which the Holder would otherwise be entitled upon a payment in Shares, the Company will pay to the Holder in cash the amount of the unpaid or unconverted Principal and interest balance of this Debenture that would otherwise be paid or converted into such fractional Share. Shares issued hereunder shall be transmitted by the transfer agent of the Company to the Holder either by crediting the account of the Holder's designated broker with the Depository Trust Company through its Deposit Withdrawal Agent Commission ("DWAC"), or, if so elected by Holder, by physical delivery of certificates to Holder's address within five (5) Trading Days from the Due Date. If the Company fails for any reason to deliver to the Holder the Shares by the requisite delivery date, the Company shall pay to the Holder, in cash, as liquidated damages and not as a penalty, for each $1,000 of Shares not timely delivered, $5 per Trading Day (increasing to $10 per Trading Day on the fifteenth (15) Trading Day after such liquidated damages begin to accrue) for each Trading Day after such requisite delivery date until such Shares are delivered. In addition to any other rights available to the Holder, if the Company fails to cause its transfer agent to deliver to the Holder the Shares on or before the requisite delivery date, and if after such date the Holder is required by its broker to purchase (in an open market transaction or otherwise), or the Holder's brokerage firm otherwise purchases, Shares to deliver in satisfaction of a sale by the Holder of the Shares which the Holder anticipated receiving pursuant to this Debenture (a "Buy-In"), then the Company shall (1) pay in cash to the Holder the amount by which (x) the Holder's total purchase price (including brokerage commissions, if any) for the Shares so purchased exceeds (y) the amount obtained by multiplying (A) the number of Shares that the Company was required to deliver to the Holder multiplied by (B) the price at which the sell order giving rise to such purchase obligation was executed, and (2) deliver to the Holder the number of Shares that would have been issued had the Company timely complied with its exercise and delivery obligations hereunder. For example, if the Holder purchases Shares having a total purchase price of $11,000 to cover a Buy-In with an aggregate sale price giving rise to such purchase obligation of $10,000, under clause (1) of the immediately preceding sentence the Company shall be required to pay the Holder $ 1,000. The Holder shall provide the Company written notice indicating the amounts payable to the Holder in respect of the Buy-In and, upon request of the Company, commercially reasonable evidence of the amount of such loss. |
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| (d) | Adjustments. If the Company, at any time while this Debenture is outstanding subdivides outstanding Shares into a larger number of shares or combines (including by way of reverse stock split) outstanding Shares into a smaller number of shares, then the Conversion Price shall be multiplied by a fraction of which the numerator shall be the number of Shares outstanding immediately before such event and of which the denominator shall be the number of Shares outstanding immediately after such event. |
6. Prepayment. This Debenture may not be prepaid by the Company without the prior written consent of the Holder, except as provided in Section 7 of this Debenture.
7. Conversion. At any time prior to five (5) business days prior to the Maturity Date, all or any portion of the Principal amount of this Debenture, together will accrued interest thereon, may be converted at the option of the Holder, at any time and from time to time, in the minimum principal amount of $5,000 and integral multiples of $1,000 thereafter, upon not less than two (2) three (3) Business Days after the Company's receipt of the Conversion Notice (as hereinafter defined) from the Holder and payment in full of the Conversion Price as then in effect. Each "Conversion Notice" shall mean a written notice from the Holder informing the Company of the date of the conversion, the principal amount of this Debenture being converted, the number of shares of Common Stock to be received upon conversion and confirming that the Conversion Price will be paid in cash. The Conversion Price shall be paid by certified check or by wire transfer of immediately available funds to a bank account designated by the Company in writing. Within three (3) Business Days after payment of the Conversion Price, the Company will deliver a certificate for the shares of Common Stock issued upon conversion to the Holder, or at the Holder’s request, to a brokerage account for the benefit of Holder. The Company shall at all times reserve for issuance a number of shares of Common Stock sufficient to satisfy the conversion feature of this Debenture. The number of shares of Common Stock issuable upon the conversion of all or a portion of this Debenture shall be equal to the Principal amount of this Debenture being converted divided by the Conversion Price. For purposes hereof, any partial conversion of this Debenture, each Loan shall be considered separate and distinct indebtedness of the Company to the Holder for purposes of determining the holding period of each item of indebtedness represented by the Loan. Notwithstanding anything set forth herein, in no event shall the Holder be entitled to convert for a number of shares of Common Stock in excess of that number of shares of Common Stock which, upon giving effect to such conversion, would cause the aggregate number of shares of Common Stock beneficially owned by the Holder and its affiliates to exceed 9.99% of the outstanding shares of the Common Stock following such conversion. Notwithstanding receipt of a Conversion Notice, the Company shall have the right to prepay this Debenture in the amount being converted if the principal amount to be converted together with accrued interest thereon is paid in immediately available funds within one (1) business day after the date of the
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8. Seniority. The indebtedness represented by this Debenture is and shall be an obligation of the Company ranking senior in right of payment, liquidation and otherwise to any future indebtedness and other obligations of the Company. The Company will not create any indebtedness that is senior in priority to the indebtedness represented by this Debenture.
9. Default. Any one of the following occurrences shall constitute an "Event of Default" under this Debenture:
(a) failure of Company to pay any amount that it payable under this Debenture on the Due Date, provided that such failure is not cured within a grace period of ten (10) calendar days; or
(b) failure to comply with or perform any other agreement or covenant of the Company contained herein, which failure does not otherwise constitute an Event of Default, provided that such failure has not been cured within thirty (30) calendar days written notice by Holder to the Company; or
(c) there shall occur any default or event of default, any similar event, any event that requires the prepayment of borrowed money or permits the acceleration of the maturity thereof, or any event or condition that might become any of the foregoing with notice or the passage of time or both, under the terms of any evidence of indebtedness or other agreement issued or assumed or entered into by the Company, or under the terms of any document or instrument under which any such evidence of indebtedness or other agreement is issued, assumed, secured, or guaranteed, and such event shall continue beyond any applicable notice, grace or cure period, provided that such condition shall not have been cured within thirty (30) calendar days of notice by Holder; or
(d) the Company shall fail to maintain its existence in good standing in its state of incorporation; provided that such condition shall not have been cured within thirty (30) calendar days of notice by Holder; or
(e) a judgment or settlement shall be entered or agreed to in any proceeding which would reasonably be expected to have a material and adverse effect on the ability of the Company to repay this Debenture; or any garnishment, summons, writ of attachment, citation, levy or the like is issued against or served upon Holder for the attachment of any property of the Company in Holder’s possession or control, provided that such condition shall not have been cured within thirty (30) calendar days of notice by Holder of such condition; or
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(f) any Share issued pursuant to this Debenture shall not be duly authorized, validly issued, fully paid or nonassessable, provided that such condition shall not have been cured within ninety (90) calendar days of notice by Holder of such condition; or
(g) the Company shake make a voluntary filing for bankruptcy under Title 11, Chapter 7 of the United States Code; or
(h) there shall be appointed a receiver or trustee to take possession of the property or assets of the Company under Title 11, Chapter 7 of the United States Code.
10. Remedies. Upon the occurrence and during the continuance of an Event of Default, this Debenture and shall become immediately due in full, and unpaid amounts hereunder will accrue interest at the rate equal to the stated rate plus 5.00% per annum, and Holder may exercise any rights and remedies under this Debenture, any Transaction Document or other document or instrument and at law or in equity. The time of payment of this Debenture is also subject to acceleration if an Event of Default occurs. Notwithstanding the foregoing, the entire unpaid Principal sum of this Debenture, together with accrued and unpaid interest thereon, shall become immediately due and payable upon any of the Events of Default set forth in this Debenture.
11. Transfer; Successors and Assigns. The terms and conditions of this Debenture shall inure to the benefit of and be binding upon the respective successors and assigns of the parties. At the election of the Holder, but subject-to compliance with applicable securities laws, this Debenture may be assigned or transferred by the Holder, in whole or in part, upon surrender of this Debenture, duly endorsed, and accompanied by a duly executed written instrument of transfer in customary form, following which a new Debenture for the same principal amount and interest will be issued to, and registered in the name of, the transferee. If less than the entire amount of this Debenture is transferred or assigned, the Company will issue new Debentures to the transferee, in the amount transferred or assigned, and to the Holder, in the remaining Principal amount hereof after the transfer or assignment. This Debenture shall be binding upon and inure to the benefit of the Company and the Holder, their successors and permitted assigns and the transferees of the Holder.
12. Governing Law. This Debenture and all acts and transactions pursuant hereto and the rights and obligations of the Company and the Holder shall be governed, construed and interpreted in accordance with the laws of the State of California, without giving effect to any of its principles of conflicts of law or choice of law principles which would result in the application of the laws of another jurisdiction.
13. Notices. Any notice required or permitted by this Debenture shall be in writing and shall be deemed sufficient upon receipt, when delivered personally or by courier, overnight delivery service or confirmed facsimile, or 96 hours after being deposited in the U.S. mail as certified or registered mail with postage prepaid, if such notice is addressed to the party to be notified at such party's address or facsimile number as set forth herein or as subsequently modified by written notice.
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14. Amendments and Waivers. This Debenture may only be amended, modified or waived by a written instrument executed by the Company and the Holder. Any amendment or waiver effected in accordance with this Section 14 shall be binding upon the Company, the Holder and each transferee or permitted assigns of any Debenture.
15. Loss of Debenture. Upon receipt by the Company of a customary representation by the Holder of the loss, theft, destruction or mutilation of this Debenture or any Debenture exchanged for it, and a customary indemnity undertaking by the Holder (in case of loss, theft or destruction) or surrender and cancellation of such Debenture {in the case of mutilation), the Company will make and deliver in lieu of such Debenture a new Debenture of like tenor.
16. Waiver of Presentment, etc. The Company hereby expressly waives presentment, demand for payment, dishonor, notice of dishonor, protest, notice of protest and any other formality upon the occurrence of an Event of Default.
17. Entire Understanding. This Debenture sets forth the entire understanding agreement of the Company and the Holder with respect to the subject matter hereof and it supersedes all prior and/or contemporaneous understandings and agreements with respect to such subject matter, all of which are merged herein, and it specifically amends and restates a Debenture dated this date in the same principal amount hereof, which did not accurately reflect the understanding and agreement of the Company and the Holder.
18. Costs and Fees. The Company agrees to pay all costs, expenses, including, without limitation, reasonable attorneys' fees and disbursements, incurred by the Holder in endeavoring to collect any amounts payable hereunder (including, without limitation, amounts payable in Shares) which are not paid when due or otherwise in enforcing any provision of this Debenture and any of the rights and remedies of the Holder under this Debenture, at law or in equity.
[signature page follows]
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IN WITNESS WHEREOF, this Debenture has been executed by a duly authorized officer of the Company as of the date first written above.
| COMPANY | |
| VG LIFE SCIENCES INC. | |
| (FORMERLY VIRAL GENETICS, INC.) | |
| By: /s/ John P. Tynan John P. Tynan | |
| President |
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NOTICE OF CONVERSION
CONVETIBLE DEBENTURE
(Date)
VG Life Sciences Inc.
121 Gray Avenue
Santa Barbara, CA 93101
Dear Mr. Tynan,
JTL Enterprises Corp (JTL) is the holder of a Convertible Debenture dated January 31, 2014 (the “Debenture”) in the amount of $5,000 made and issued by VG Life Sciences Inc. (“VGLS”), a Delaware corporation in favor of JTL.
This letter shall constitute notice to VGLS that JTL does hereby exercise its right to take payment of the outstanding principal amount of the Debenture, or the amount of $____________, in shares of VGLS common stock at a price of $0.10 per share. This will leave the remainder of $__________, still due and payable under this January 31, 2014 convertible debenture.
Please have the __________shares issued in the names of Myron Landin (80% share) and Samuel Zemsky (20% share) in accordance with the terms and provisions of our agreement. JTL is not and never has been a 5% of 10% holder of VGLS common stock.
Very truly yours,
/s/ Myron W. Landin
Myron W. Landin
President
JTL Enterprises Corp.
1107 38th Avenue
Seattle, WA 98122
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Exhibit 10.143
September 11, 2014
VG Life Sciences Inc.
2290 Huntington Drive, Suite 100
San Marino, CA 91108
Tel: 626-334-5310
Dear Mr Keledjian,
NOTICE OF CONVERSION
The undersigned hereby elects to convert principal under the Unsecured Convertible Debentures of VG Life Sciences, Inc., a Delaware corporation (the “Company”), that has been duly paid for and acquired by DMBM Inc. under the Note Purchase Agreements dated August 1, 2013, December 1, 2013 and January 31, 2014 and converted under the Release and Settlement Agreement dated July 1, 2013, into shares of common stock, par value $0.0001 per share (the “Common Stock”), of the Company according to the conditions hereof, as of the date written below.
| Conversion calculations: | $68,000 / $0.05 = 1,360,000 shares |
| Date to Effect Conversion: | September 11, 2014 |
| Principal Amount of Debenture to be converted: | $68,000 |
| Number of shares of Common Stock to be issued: | 1,360,000 |
| DMBM, Inc. | |
| /s/ Damon R Devitt | |
| Damon R Devitt | |
| Duly authorized officer |
Exhibit 10.148
EXHIBIT A(2)
VG LIFE SCIENCES INC.
CONVERTIBLE PROMISSORY NOTE
THIS CONVERTIBLE PROMISSORY NOTE (“Note”) is issued as of October 27, 2014 (the “Original Issue Date”), by VG Life Sciences Inc., a Delaware corporation (the “Company”), in an aggregate principal amount of $50,000.00.
Terms not otherwise defined herein shall have the meanings given in Section 6 below.
FOR VALUE RECEIVED, the Company promises to pay to DW Odell Company, LLC, or registered assigns (the “Holder”), the principal sum of fifty thousand dollars ($50,000.00), on or before July 9, 2016 (the “Maturity Date”) and to pay simple interest to the Holder on the principal sum, at the rate per annum of eight percent (8%). Interest shall accrue daily commencing on the Original Issue Date until payment in full of the principal sum, together with all accrued and unpaid interest, has been made or duly provided for. Interest shall be calculated on the basis of a 360-day year. Interest hereunder will be due and payable at the Maturity Date, to the person in whose name this Note is registered on the records of the Company (the “Note Register”). The principal of, and interest on, this Note are payable in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts, at the address of the Holder last appearing on the Note Register. A transfer of the right to receive principal and interest under this Note shall be transferable only through an appropriate entry in the Note Register as provided herein.
This Note is subject to the following additional provisions:
Section 1. Convertible Note and Warrant Purchase Agreement. This Note is one of the Notes issued pursuant to that certain Convertible Note and Warrant Purchase Agreement (the “Agreement”) between the Company and Holder dated as of July 9, 2014. This Note is subject to, and qualified by, all the terms and conditions set forth in the Agreement.
Section 2. Events of Default.
Section 2.1 Events of Default Defined; Acceleration of Maturity. If an Event of Default (as defined in the Agreement) has occurred then upon the occurrence of any such Event of Default, the Holder may, by notice to the Company, declare the unpaid principal amount of the Notes to be, and the same shall forthwith become, due and payable, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Company, together with the interest accrued thereon and all other amounts payable by the Company hereunder and pursue all of Holder’s rights and remedies hereunder and under the other Loan Documents and all other remedies available to Holder under applicable law.
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Section 3. Optional Conversion.
(a) The outstanding principal and all accrued and unpaid interest of this Note shall be convertible, at the option of the Holder, into shares of common stock of the Company (“Common Stock”) at the Conversion Ratio, at the option of the Holder, in four equal tranches (25% each) on the following dates: October 9, 2015, January 9, 2016, April 9, 2016, and July 9, 2016. Any conversion under this Section 3(a) shall be of a minimum amount of U.S. $5,000 of Notes. The Holder shall effect conversions by surrendering the Notes (or such portions thereof) to be converted to the Company, together with the form of conversion notice attached hereto as Exhibit A (the “Conversion Notice”) in the manner set forth in Section 3(h). Each Conversion Notice shall specify the principal amount of Notes to be converted and the date on which such conversion is to be effected (the “Conversion Date”). Subject to Section 3(b), each Conversion Notice, once given, shall be irrevocable. If the Holder is converting less than all of the principal amount represented by the Note(s) tendered by the Holder with the Conversion Notice, the Company shall promptly deliver to the Holder a new Note for such principal amount as has not been converted.
(b) Not later than fifteen (15) Business Days after the Conversion Date, the Company will deliver to the Holder (i) a certificate or certificates containing the restrictive legends and trading restrictions required by law, if any, representing the number of shares of Common Stock being acquired upon the conversion of Notes and (ii) Notes in principal amount equal to the principal amount of Notes not converted; provided, however that the Company shall not be obligated to issue certificates evidencing the shares of Common Stock issuable upon conversion of any Notes, until Notes are either delivered for conversion to the Company or any transfer Holder for the Notes or Common Stock, or the Holder notifies the Company that such Notes have been lost, stolen or destroyed and provides a lost instrument indemnity to the Company to indemnify the Company from any loss incurred by it in connection therewith. If such certificate or certificates are not delivered by the date required under this Section 3(b), the Holder shall be entitled by written notice to the Company at any time on or before its receipt of such certificate or certificates thereafter, to rescind such conversion, in which event the Company shall immediately return the Notes tendered for conversion.
(c) (i) The conversion price (“Conversion Price”) for the Note in effect on any Conversion Date shall be $0.065, which is equal to 10% less than the lowest consecutive 3 day average closing price during the period beginning August 25, 2014 and ending October 24, 2014, subject to adjustment as otherwise contemplated by this Section 3(c).
(ii) In case of any Acquisition (as defined below) of the Company, then Holder shall have the right thereafter to convert any principal and interest remaining owing under this Note prior to the closing of any such Acquisition. At the election of Holder, Holder may convert this Note into the shares of stock and other securities and property receivable upon or deemed to be held by holders of Common Stock following such Acquisition, and the Holder shall be entitled upon such event to receive such amount of securities or property as the shares of the Common Stock, into which the Note could have been converted immediately prior to such Acquisition, would have been entitled. The terms of any such Acquisition shall include such terms so as to continue to give to the Holder the right to receive the securities or property set forth in this Section 3(c) upon any conversion following such Acquisition. This provision shall similarly apply to successive Acquisitions. “Acquisition” means (a) the closing of the sale, transfer or other disposition of all or substantially all of the VGLS’s assets, (b) the consummation of the merger or consolidation of VGLS with or into another entity (except a merger or consolidation in which the holders of capital stock of VGLS immediately prior to such merger or consolidation continue to hold at least fifty percent (50%) of the voting power of the capital stock of VGLS or the surviving or acquiring entity), or any transaction or series of transactions to which VGLS is a party in which in excess of fifty percent (50%) of VGLS’s voting power is transferred, or (c) the exclusive license of all or substantially all of the intellectual property of VGLS to a third party
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(iii) The Conversion Price shall be subject to adjustment as follows:
(A) In case the Company shall (i) pay a dividend in shares of its capital stock, (ii) subdivide its outstanding shares of Common Stock, (iii) combine its outstanding shares of Common Stock into a smaller number of shares, or (iv) issue by reclassification of its shares of Common Stock any shares of the Company, the Conversion Price in effect immediately prior thereto shall be adjusted so that the Holder of this Note thereafter surrendered for conversion shall be entitled to received the number of shares of Common Stock which he would have owned or have been entitled to receive after the happening of any of the events described above, had this Note been converted immediately prior to the happening of such event. Such adjustment shall be made whenever any of the events listed above shall occur. An adjustment made pursuant to this subdivision (A) shall become effective retroactively immediately after the record date in the case of a dividend and shall become effective immediately after the effective date in the case of a subdivision, combination or reclassification.
(B) If, at any time while this Note is outstanding, the Company takes any voluntary action or any event occurs as to which the foregoing subdivisions are not strictly applicable, but the failure to make an adjustment in the Conversion Price hereunder would not fairly protect the rights, without dilution, represented by this Note, then the Conversion Price in effect immediately prior thereto shall be adjusted so that the Holder of this Note shall be entitled to receive the number of shares of Common Stock which he would have owned or been entitled to receive after the happening of any such action or event, had this Note been converted immediately prior to the happening of any such action or event.
(d) The Company covenants that it will at all times reserve and keep available out of its authorized and unissued Common Stock solely for the purpose of issuance upon conversion of Notes as herein provided, free from preemptive rights or any other actual contingent purchase rights of persons other than the holders of Notes, such number of shares of Common Stock as shall be issuable upon the conversion of the aggregate principal amount of all outstanding Notes. The Company covenants that all shares of Common Stock that shall be so issuable shall, upon issue, be duly and validly authorized, issued and fully paid and nonassessable.
(e) Upon a conversion hereunder the Company shall not be required to issue stock certificates representing fractions of shares of Common Stock, but may, if otherwise permitted, make a cash payment in respect of any final fraction of a share based on the Conversion Price at such time.
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(f) The issuance of certificates for shares of Common Stock on conversion of Notes shall be made without charge to the Holder for any documentary stamp or similar taxes that may be payable in respect of the issue or delivery of such certificate, provided that the Company shall not be required to pay any tax that may be payable in respect of any transfer involved in the issuance and delivery of any such certificate upon conversion in a name other than that of the Holder and the Company shall not be required to issue or deliver such certificates unless or until the person or persons requesting the issuance thereof shall have paid to the Company the amount of such tax or shall have established to the satisfaction of the Company that such tax has been paid.
(g) Notes converted into Common Stock shall be canceled.
(h) Each Conversion Notice shall be given by email or mail, postage prepaid, addressed to the Controller of the Company of VG Life Sciences Inc. located 121 Gray Avenue, Suite 200, Santa Barbara, CA 93101. Any such notice shall be deemed given and effective upon the earliest to occur of (i) receipt of such email at the email address specified in this Section 3(h), (ii) five days after deposit in the United States mails or (iii) upon actual receipt by the party to whom such notice is required to be given.
Section 4. Mandatory Conversion.
(a) In the event Holder has not elected to convert all of the principal and interest remaining owing under this Note on or prior to two years after the date of this note, the then outstanding principal and accrued and unpaid interest amount of this Note shall, without further action by the Holder or the Company, be automatically converted in whole into that number of shares of Common Stock of the Company at the Conversion Ratio on the Maturity Date (the “Mandatory Conversion Date”).
(b) Not later than ten (10) Business Days after the Mandatory Conversion Date, the Company will deliver to the Holder a certificate or certificates containing the restrictive legends and trading restrictions required by law, if any, representing the number of shares of Common Stock being acquired upon the mandatory conversion of this Note; provided, however that the Company shall not be obligated to issue certificates evidencing the equity securities issuable upon conversion of this Note, until the Note is either delivered for conversion to the Company or any transfer Holder of the Note or Common Stock, or the Holder notifies the Company that the Note have been lost, stolen or destroyed and provides a lost instrument indemnity or bond to the Company to indemnify the Company from any loss incurred by it in connection therewith. The Company covenants and agrees that it shall comply with Sections 3(d) through (g) with respect to any mandatory conversion and such sections are incorporated by reference herein.
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Section 5. Payment of Principal and Redemption.
(a) In the event of an occurrence of an Event of Default, then the outstanding principal balance of this Note shall be due and payable in full on the Maturity Date. Prior to the Mandatory Conversion Date this Note may not be prepaid.
(b) Nothing in this Section 5 shall impair the Holder’s right to convert this Note pursuant to Section 3 prior to the Mandatory Conversion Date.
Section 6. Definitions. For the purposes hereof, the following terms shall have the following meanings:
“Business Day” shall mean any day, except a Saturday, Sunday or other day on which commercial banks in the State of California are authorized or required by law to close.
“Conversion Ratio” means, at any time, a fraction, of which the numerator is the outstanding principal amount represented by any Note plus accrued but unpaid interest, and of which the denominator is the Conversion Price at such time.
“Original Issue Date” means the date of the first issuance of this Note regardless of the number transfers hereof.
Section 7. Stockholder Rights. This Note shall not entitle the Holder to any of the rights of a stockholder of the Company, including without limitation, the right to vote, to receive dividends and other distributions, or to receive any notice of, or to attend, meetings of stockholders or any other proceedings of the Company, unless and to the extent converted into shares of Common Stock in accordance with the terms hereof.
Section 8. Lost Note. If this Note shall be mutilated, lost, stolen or destroyed, the Company shall execute and deliver, in exchange and substitution for and upon cancellation of a mutilated Note, or in lieu of or in substitution for a lost, stolen or destroyed debenture, a new Note for the principal amount of this Note so mutilated, lost, stolen or destroyed but only upon receipt of evidence of such loss, theft or destruction of such Note, and of the ownership hereof, and indemnity or bond, if requested, all reasonably satisfactory to the Company.
Section 9. Governing Law. This Note shall be governed by and construed in accordance with the laws of the State of California, without giving effect to conflicts of laws thereof.
Section 10. Notices. All notices or other communications hereunder shall be given, and shall be deemed duly given and received, if given, in the manner set forth in Section 5(h).
Section 11. Waiver. Any waiver by the Company or the Holder a breach of any provision of this Note shall not operate as or be construed to be a waiver of any other breach of such provision or of any breach of any other provision of this Note. The failure of the Company or the Holder to insist upon strict adherence to any term of this Note on one or more occasions shall not be considered a waiver or deprive that party of the right thereafter to insist upon strict adherence to that term or any other term of this Note. Any waiver must be in writing.
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Section 12. Severability. If any provision of this Note is invalid, illegal or unenforceable, the balance of this Note shall remain in effect, and if any provision is inapplicable to any person or circumstance, it shall nevertheless remain applicable to all other persons and circumstances.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed by an officer thereunto duly authorized as of the date first above indicated.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.
| VG LIFE SCIENCES INC., | ||
| a Delaware corporation | ||
| By: | /s/ Haig Keledjian | |
Name: Haig Keledjian Title: Chairman | ||
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EXHIBIT A
NOTICE OF CONVERSION
AT THE ELECTION OF HOLDER
(To be Executed by the Registered Holder in order to Convert the Note)
The undersigned hereby irrevocably elects to convert the above Note into shares of Common Stock, no par value per share (the “Common Stock”), of VG Life Sciences Inc. (the “Company”) according to the conditions hereof, as of the date written below. If shares are to be issued in the name of a person other than undersigned, the undersigned will pay all transfer taxes payable with respect thereto and is delivering herewith such certificates and opinions as reasonably requested by the Company in accordance therewith. No fee will be charged to the Holder for any conversion, except for such transfer taxes, if any.
| Conversion calculations: | ||
| Date to Effect Conversion | ||
| Principal Amount of Notes to be Converted | ||
| Applicable Conversion Price | ||
| Signature | ||
| Name: | ||
| Address: |
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Schedule of Cash Proceeds from DW Odell Company, LLC
and Received by VG Life Sciences Inc.
| July 9, 2014 | $100,000.00 | |
| September 16, 2014 | $50,000.00 | |
| October 27, 2014 | $50,000.00 | |
| $___________ | ||
Date: ______________ |
||
| $___________ | ||
Date: ______________ |
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Exhibit 10.149
EXHIBIT B(2)
WARRANT TO PURCHASE STOCK
Company: VG Life Sciences Inc.
Number of Shares: 200,000
Class of Stock: Common
Initial Exercise Price Per Share: $0.49
Issue Date: October 27, 2014
THIS WARRANT CERTIFIES THAT, for good and valuable consideration, DW Odell Company, LLC, a California limited liability company (“Holder”) is entitled to purchase the number of fully paid and nonassessable shares of the class of securities (the “Shares”) of VG Life Sciences Inc. (the “Company” or “VGLS”) at the initial exercise price per Share (the “Warrant Price”) all as set forth above and as adjusted pursuant to Article 2 of this Warrant, subject to the provisions and upon the terms and conditions set forth of this Warrant.
ARTICLE 1. EXERCISE
1.1 Method of Exercise. Holder may exercise this Warrant by delivering a duly executed Notice of Exercise in substantially the form attached as Appendix 1 to the principal office of the Company. Unless Holder is exercising the conversion right set forth in Section 1.2, Holders shall also deliver to the Company a check for the aggregate Warrant Price for the Shares being purchased.
1.2 Conversion Right. In lieu of exercising this Warrant as specified in Section 1.1, Holder may from time to time convert this Warrant, in whole or in part, into a number of Shares determined by dividing (a) the aggregate fair market value of the Shares or other securities otherwise issuable upon exercise of this Warrant minus the aggregate Warrant Price of such Shares by (b) the fair market value of one Share. The fair market value of the Shares shall be determined pursuant Section 1.4.
1.3 No Rights Shareholder. This Warrant does not entitle Holder to any voting rights as a shareholder of the Company prior to the exercise hereof.
1.4 Fair Market Value. For purposes of Section 1.2, if the Shares are traded in a public market, the fair market value of the Shares shall be the closing price of the Shares (or the closing price of the Company’s stock into which the Shares are convertible) reported for the business day immediately before Holder delivers its Notice of Exercise to the Company. If the Shares are not traded in a public market, the Board of Directors of the Company shall determine fair market value in its reasonable good faith judgment. The foregoing notwithstanding, if Holder advises the Board of Directors in writing that Holder disagrees with such determination, then the Company and Holder shall promptly agree upon a reputable investment banking or public accounting firm to undertake such valuation. If the valuation of such investment banking firm is greater than that determined by the Board of Directors, then all fees and expenses of such investment banking firm shall be paid by the Company. In all other circumstances, such fees and expenses shall be paid by Holder.
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1.5 Delivery of Certificate and New Warrant. Promptly after Holder exercises or converts this Warrant, the Company shall deliver to Holder certificates for the Shares acquired and, if this Warrant has not been fully exercised or converted and has not been fully exercised or converted and has not expired, a new Warrant representing the Shares not so acquired.
1.6 Replacement of Warrants. On receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant and, in the case of loss, theft or destruction, on delivery of an indemnity agreement reasonably satisfactory in form and amount to the Company or, in the case of mutilation, or surrender and cancellation of this Warrant, the Company at its expense shall execute and deliver, in lieu of this Warrant, a new warrant of like tenor.
1.7 Repurchase on Sale, Merger, or Consolidation of the Company
1.7.1 “Acquisition” For the purpose of this Warrant, “Acquisition” means (a) the closing of the sale, transfer or other disposition of all or substantially all of the VGLS’s assets, (b) the consummation of the merger or consolidation of VGLS with or into another entity (except a merger or consolidation in which the holders of capital stock of VGLS immediately prior to such merger or consolidation continue to hold at least fifty percent (50%) of the voting power of the capital stock of VGLS or the surviving or acquiring entity), or any transaction or series of transactions to which VGLS is a party in which in excess of fifty percent (50%) of VGLS’s voting power is transferred, or (c) the exclusive license of all or substantially all of the intellectual property of VGLS to a third party.
1.7.2 Assumption of Warrant. Upon the closing of any Acquisition the successor entity shall assume the obligations of this Warrant, and this Warrant shall be exercisable for the same securities, cash, and property as would be payable for the Shares issuable upon exercise of the unexercised portion of this Warrant as if such Shares were outstanding on the record date for the Acquisition and subsequent closing.
1.7.3 Purchase Right. At the election of Holder, the Company shall purchase the unexercised portion of this Warrant for cash upon the closing of any Acquisition for an amount equal to (a) the fair market value of any consideration that would have been received by Holder in consideration of the Shares had Holder exercised the unexercised portion of this Warrant immediately before the record date for determining the shareholders entitled to participate in the proceeds of the Acquisition, less (b) the aggregate Warrant Price of the Shares, but in no event less than zero.
ARTICLE 2. ADJUSTMENTS TO THE SHARES.
2.1 Stock Dividends, Splits, Etc. If the Company declares or pays a dividend on its common stock ( or the Shares if the Shares are securities other than common stock ) payable in common stock, or other securities, subdivides the outstanding common stock into a greater amount of common stock, or, if the Shares are securities other than common stock, subdivides the Shares in a transaction that increases the amount of common stock into which the Shares are convertible, then upon exercise of this Warrant, for each Share acquired, Holder shall receive, without cost to Holder, the total number and kind of securities to which Holder would have been entitled had Holder owned the Shares of record as of the date the dividend or subdivision occurred.
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2.2 Reclassification, Exchange or Substitution. Upon any reclassification, exchange, substitution, or other event that results in a change of the number and/or class of the securities issuable upon exercise or conversion of this Warrant, Holder shall be entitled to receive, upon exercise or conversion of this Warrant, the number and kind of securities and property that Holder would have received for the shares if this Warrant had been exercised immediately before such reclassification, exchange, substitution, or other event. Such an event shall include any automatic conversion of the outstanding or issuable securities of the Company of the same class or series as the Shares to common stock pursuant to the terms of the Company’s Certificate of Incorporation upon the closing of a registered public offering of the Company’s common stock. The Company or its successor shall promptly issue to Holder a new Warrant for such new securities or other property. The new adjustments provided for in this Article 2 including, without limitation, adjustments to the Warrant Price and to the number of securities or property issuable upon exercise of the new Warrant. The provisions of this Section 2.2 shall similarly apply to successive reclassifications, exchanges, substitutions, or other events.
2.3 Adjustments for Combinations, Etc. If the outstanding Shares are combined or consolidated, by reclassification or otherwise, into a lesser number of shares, the Warrant price shall be proportionately increased.
2.4 Adjustments for Diluting Issuances. The number of shares of common stock issuable upon conversion of the Shares, shall be subject to adjustment, from time to time in the manner set forth in the Company’s Certificate of Incorporation with respect to issuance of securities for a price lower than certain prices specified in the Certificate of Incorporation.
2.5 No Impairment. The Company shall not, by amendment of its Certificate of Incorporation or through a reorganization, transfer of assets, consolidation, merger, dissolution, issue, or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms to be observed or performed under this Warrant by the Company, but shall at all times in good faith assist in carrying out of all the provisions of this Article 2 and in taking all such action as may be necessary or appropriate to protect Holder’s rights under this Article against impairment. If the Company takes any action affecting the Shares or its common stock other than as described above that adversely affects Holder’s rights under this Warrant, the Warrant Price shall be adjusted downward and the number of Shares issuable upon exercise of this Warrant shall be adjusted upward in such a manner that the aggregate Warrant price of this Warrant is unchanged.
2.6 Fractional Shares. No fractional Shares shall be issuable upon exercise or conversion of the Warrant and the number of Shares to be issued shall be rounded down to the nearest whole Share. If a fractional share interest arises upon any exercise or conversion of the Warrant, the Company shall eliminate such fractional share interest by paying Holder amount computed by multiplying the fractional interest by the fair market value of a full Share.
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2.7 Certificate as to Adjustments. Upon each adjustment of the Warrant Price, the Company at its expense shall promptly compute such adjustment, and furnish Holder with a certificate of its Chief Financial Officer setting forth such adjustment and the facts upon which such adjustment is based. The Company shall, upon written request, furnish Holder a certificate setting forth the Warrant price in effect upon the date thereof and the series of adjustments leading to such Warrant Price.
ARTICLE 3. REPRESENTATIONS AND COVENANTS OF THE COMPANY.
3.1 Representations and Warranties. The Company hereby represents and warrants to the Holder that all Shares which may be issued upon the exercise of the purchase right represented by this Warrant and all securities, if any, issuable upon conversion of the Shares, shall, upon issuance, be duly authorized, validly issued, fully paid and nonassessable, and free of any liens and encumbrances except for restrictions on transfer provided for herein or under applicable federal and state securities laws.
3.2 Notice of Certain Events. If the Company proposes at any time (a) to declare any dividend or distribution upon its common stock, whether in cash, property, stock or other securities and whether or not a regular cash dividend; (b) to offer for subscription pro rata to the holders of any class or series or other rights; (c) to effect any reclassification or recapitalization of common stock; (d) to merge or consolidate with or into any other corporation, or sell, lease, license, or convey all or substantially all of its assets, or to liquidate, dissolve or wind up; or (e) offer holders of registration rights the opportunity to participate in an underwritten public offering of the Company’s securities for cash, then, in connection with each such event, the Company shall give Holder (1) at least 20 days prior written notice of the date on which a record will be taken for such dividend, distribution or subscription rights (and specifying the date on which the holders of common stock will be entitled thereto) or for determining rights to vote, if any, in respect of the matters referred to in (c) and (d) above; 2 in the case of the matters referred to in (c) and (d) above at least 20 days prior written notice of the date when the same will take place (and specifying the date on which the holders of common stock will be entitled to exchange their common stock for securities or other property deliverable upon the occurrence of such event); and (3) in the case of the matter referred to in (e) above, the same notice as is given to the holders of such registration rights.
3.3 Information Rights. So long as the Holder holds this Warrant and /or any of the Shares, the Company shall deliver to the Holder (a) promptly after mailing, copies of all notices or other written communications to the shareholders of the Company, (b) within ninety (90) days after the end of each fiscal year of the Company, the annual financial statements of the Company.
3.4 Registration Under Securities Act of 1933, as amended. The Company agrees that the Shares shall be subject to the registration rights granted to any other holders of the Company’s common stock.
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ARTICLE 4. MISCELLANEOUS.
4.1 Term. This Warrant is exercisable, in whole or in part, at any time and from time to time on or after the fourth anniversary of the Issue Date hereof and up to and including the fifth anniversary of the Issue Date.
4.2 Legends. This Warrant and the Shares (and the securities issuable, directly or indirectly, upon conversion of the Shares, if any) shall be imprinted with a legend in substantially the following form:
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, PLEDGED OR OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT OR PURSUANT TO RULE 144 OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE CORPORATION AND ITS COUNSEL THAT SUCH REGISTRATION IS NOT REQUIRED.
4.3 Compliance with Securities Laws on Transfer. This Warrant and the Shares issuable upon exercise this Warrant (and the securities issuable, directly or indirectly, upon conversion of the shares, if any) may not be transferred or assigned in whole or in part without compliance with limitation, the delivery of investment representation letters and legal opinions reasonably satisfactory to the Company, as reasonable requested by the Company). The Company shall not require Holder to provide an opinion of counsel if the transfer is to an affiliate of Holder or if there is no material question as to the availability of current information as referenced in rule 144(c), Holder represents that it has complied with Rule 144(d) and (e) in reasonable detail, the selling broker represents that it has complied with Rule 144(f), and the Company is provided with a copy of Holder’s notice of proposed sale.
4.4 Transfer Procedure. Subject to the provisions of Section 4.2, Holder may transfer all or part of this Warrant or the Shares issuable upon exercise of this Warrant (or the securities issuable, directly or indirectly, upon conversion of the Shares, if any) by giving the Company notice of the portion of the Warrant being transferred setting forth the name, address and taxpayer identification number of the transferee and surrendering this Warrant to the Company for reissuance to the transferee(s) (and Holder if applicable).
4.5 Notices. All notices and other communications from the Company to the Holder, or vice versa, shall be deemed delivered and effective when given personally or mailed by first-class registered or certified mail, postage prepaid, at such address as may have been furnished to the Company or the Holder, as the case may be, in writing by the Company or such Holder from time to time.
4.6 Waiver. This Warrant and any term hereof may be changed, waived, discharged or terminated only by an instrument in writing signed by the party against which enforcement of such change, waiver, discharge or termination is sought.
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4.7 Attorneys Fees. In the event of any dispute between the parties concerning the terms and provisions of this Warrant , the party prevailing in such dispute shall be entitled to collect from the other party all costs incurred in such dispute, including reasonable attorney’s fees.
4.8 Governing Law. This Warrant shall be governed by and construed in accordance with the laws of the State of California, without giving effect to its principles regarding conflicts of law.
| /s/ Haig Keledjian | ||
| By: Haig Keledjian | ||
| Title: Chairman |
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APPENDIX 1
NOTICE OF EXERCISE
1. The undersigned hereby elects to convert the attached Warrant into in the manner specified in the Warrant. This conversion is exercised with respect to _______________________ of the Shares covered by the Warrant.
2. Please issue a certificate or certificates representing said shares in the name of the undersigned or in such other name as is specified below:
______________________________________
(Name)
________________________________________
________________________________________
(Address)
3. The undersigned represents it is acquiring the shares solely for its own account and not as a nominee for any other party and not with a view toward the resale or distribution thereof except in compliance with applicable securities laws.
| (Date) | (Signature) |
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Exhibit 10.150
EXHIBIT A(2)
VG LIFE SCIENCES INC.
CONVERTIBLE PROMISSORY NOTE
THIS CONVERTIBLE PROMISSORY NOTE (“Note”) is issued as of October 27, 2014 (the “Original Issue Date”), by VG Life Sciences Inc., a Delaware corporation (the “Company”), in an aggregate principal amount of $50,000.00.
Terms not otherwise defined herein shall have the meanings given in Section 6 below.
FOR VALUE RECEIVED, the Company promises to pay to Wild Harp Holdings, LLC, or registered assigns (the “Holder”), the principal sum of fifty thousand dollars ($50,000.00), on or before July 9, 2016 (the “Maturity Date”) and to pay simple interest to the Holder on the principal sum, at the rate per annum of eight percent (8%). Interest shall accrue daily commencing on the Original Issue Date until payment in full of the principal sum, together with all accrued and unpaid interest, has been made or duly provided for. Interest shall be calculated on the basis of a 360-day year. Interest hereunder will be due and payable at the Maturity Date, to the person in whose name this Note is registered on the records of the Company (the “Note Register”). The principal of, and interest on, this Note are payable in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts, at the address of the Holder last appearing on the Note Register. A transfer of the right to receive principal and interest under this Note shall be transferable only through an appropriate entry in the Note Register as provided herein.
This Note is subject to the following additional provisions:
Section 1. Convertible Note and Warrant Purchase Agreement. This Note is one of the Notes issued pursuant to that certain Convertible Note and Warrant Purchase Agreement (the “Agreement”) between the Company and Holder dated as of July 9, 2014. This Note is subject to, and qualified by, all the terms and conditions set forth in the Agreement.
Section 2. Events of Default.
Section 2.1 Events of Default Defined; Acceleration of Maturity. If an Event of Default (as defined in the Agreement) has occurred then upon the occurrence of any such Event of Default, the Holder may, by notice to the Company, declare the unpaid principal amount of the Notes to be, and the same shall forthwith become, due and payable, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Company, together with the interest accrued thereon and all other amounts payable by the Company hereunder and pursue all of Holder’s rights and remedies hereunder and under the other Loan Documents and all other remedies available to Holder under applicable law.
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Section 3. Optional Conversion.
(a) The outstanding principal and all accrued and unpaid interest of this Note shall be convertible, at the option of the Holder, into shares of common stock of the Company (“Common Stock”) at the Conversion Ratio, at the option of the Holder, in four equal tranches (25% each) on the following dates: October 9, 2015, January 9, 2016, April 9, 2016, and July 9, 2016. Any conversion under this Section 3(a) shall be of a minimum amount of U.S. $5,000 of Notes. The Holder shall effect conversions by surrendering the Notes (or such portions thereof) to be converted to the Company, together with the form of conversion notice attached hereto as Exhibit A (the “Conversion Notice”) in the manner set forth in Section 3(h). Each Conversion Notice shall specify the principal amount of Notes to be converted and the date on which such conversion is to be effected (the “Conversion Date”). Subject to Section 3(b), each Conversion Notice, once given, shall be irrevocable. If the Holder is converting less than all of the principal amount represented by the Note(s) tendered by the Holder with the Conversion Notice, the Company shall promptly deliver to the Holder a new Note for such principal amount as has not been converted.
(b) Not later than fifteen (15) Business Days after the Conversion Date, the Company will deliver to the Holder (i) a certificate or certificates containing the restrictive legends and trading restrictions required by law, if any, representing the number of shares of Common Stock being acquired upon the conversion of Notes and (ii) Notes in principal amount equal to the principal amount of Notes not converted; provided, however that the Company shall not be obligated to issue certificates evidencing the shares of Common Stock issuable upon conversion of any Notes, until Notes are either delivered for conversion to the Company or any transfer Holder for the Notes or Common Stock, or the Holder notifies the Company that such Notes have been lost, stolen or destroyed and provides a lost instrument indemnity to the Company to indemnify the Company from any loss incurred by it in connection therewith. If such certificate or certificates are not delivered by the date required under this Section 3(b), the Holder shall be entitled by written notice to the Company at any time on or before its receipt of such certificate or certificates thereafter, to rescind such conversion, in which event the Company shall immediately return the Notes tendered for conversion.
(c) (i) The conversion price (“Conversion Price”) for the Note in effect on any Conversion Date shall be $0.065, which is equal to 10% less than the lowest consecutive 3 day average closing price during the period beginning August 25, 2014 and ending October 24, 2014, subject to adjustment as otherwise contemplated by this Section 3(c).
(ii) In case of any Acquisition (as defined below) of the Company, then Holder shall have the right thereafter to convert any principal and interest remaining owing under this Note prior to the closing of any such Acquisition. At the election of Holder, Holder may convert this Note into the shares of stock and other securities and property receivable upon or deemed to be held by holders of Common Stock following such Acquisition, and the Holder shall be entitled upon such event to receive such amount of securities or property as the shares of the Common Stock, into which the Note could have been converted immediately prior to such Acquisition, would have been entitled. The terms of any such Acquisition shall include such terms so as to continue to give to the Holder the right to receive the securities or property set forth in this Section 3(c) upon any conversion following such Acquisition. This provision shall similarly apply to successive Acquisitions. “Acquisition” means (a) the closing of the sale, transfer or other disposition of all or substantially all of the VGLS’s assets, (b) the consummation of the merger or consolidation of VGLS with or into another entity (except a merger or consolidation in which the holders of capital stock of VGLS immediately prior to such merger or consolidation continue to hold at least fifty percent (50%) of the voting power of the capital stock of VGLS or the surviving or acquiring entity), or any transaction or series of transactions to which VGLS is a party in which in excess of fifty percent (50%) of VGLS’s voting power is transferred, or (c) the exclusive license of all or substantially all of the intellectual property of VGLS to a third party
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(iii) The Conversion Price shall be subject to adjustment as follows:
(A) In case the Company shall (i) pay a dividend in shares of its capital stock, (ii) subdivide its outstanding shares of Common Stock, (iii) combine its outstanding shares of Common Stock into a smaller number of shares, or (iv) issue by reclassification of its shares of Common Stock any shares of the Company, the Conversion Price in effect immediately prior thereto shall be adjusted so that the Holder of this Note thereafter surrendered for conversion shall be entitled to received the number of shares of Common Stock which he would have owned or have been entitled to receive after the happening of any of the events described above, had this Note been converted immediately prior to the happening of such event. Such adjustment shall be made whenever any of the events listed above shall occur. An adjustment made pursuant to this subdivision (A) shall become effective retroactively immediately after the record date in the case of a dividend and shall become effective immediately after the effective date in the case of a subdivision, combination or reclassification.
(B) If, at any time while this Note is outstanding, the Company takes any voluntary action or any event occurs as to which the foregoing subdivisions are not strictly applicable, but the failure to make an adjustment in the Conversion Price hereunder would not fairly protect the rights, without dilution, represented by this Note, then the Conversion Price in effect immediately prior thereto shall be adjusted so that the Holder of this Note shall be entitled to receive the number of shares of Common Stock which he would have owned or been entitled to receive after the happening of any such action or event, had this Note been converted immediately prior to the happening of any such action or event.
(d) The Company covenants that it will at all times reserve and keep available out of its authorized and unissued Common Stock solely for the purpose of issuance upon conversion of Notes as herein provided, free from preemptive rights or any other actual contingent purchase rights of persons other than the holders of Notes, such number of shares of Common Stock as shall be issuable upon the conversion of the aggregate principal amount of all outstanding Notes. The Company covenants that all shares of Common Stock that shall be so issuable shall, upon issue, be duly and validly authorized, issued and fully paid and nonassessable.
(e) Upon a conversion hereunder the Company shall not be required to issue stock certificates representing fractions of shares of Common Stock, but may, if otherwise permitted, make a cash payment in respect of any final fraction of a share based on the Conversion Price at such time.
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(f) The issuance of certificates for shares of Common Stock on conversion of Notes shall be made without charge to the Holder for any documentary stamp or similar taxes that may be payable in respect of the issue or delivery of such certificate, provided that the Company shall not be required to pay any tax that may be payable in respect of any transfer involved in the issuance and delivery of any such certificate upon conversion in a name other than that of the Holder and the Company shall not be required to issue or deliver such certificates unless or until the person or persons requesting the issuance thereof shall have paid to the Company the amount of such tax or shall have established to the satisfaction of the Company that such tax has been paid.
(g) Notes converted into Common Stock shall be canceled.
(h) Each Conversion Notice shall be given by email or mail, postage prepaid, addressed to the Controller of the Company of VG Life Sciences Inc. located 121 Gray Avenue, Suite 200, Santa Barbara, CA 93101. Any such notice shall be deemed given and effective upon the earliest to occur of (i) receipt of such email at the email address specified in this Section 3(h), (ii) five days after deposit in the United States mails or (iii) upon actual receipt by the party to whom such notice is required to be given.
Section 4. Mandatory Conversion.
(a) In the event Holder has not elected to convert all of the principal and interest remaining owing under this Note on or prior to two years after the date of this note, the then outstanding principal and accrued and unpaid interest amount of this Note shall, without further action by the Holder or the Company, be automatically converted in whole into that number of shares of Common Stock of the Company at the Conversion Ratio on the Maturity Date (the “Mandatory Conversion Date”).
(b) Not later than ten (10) Business Days after the Mandatory Conversion Date, the Company will deliver to the Holder a certificate or certificates containing the restrictive legends and trading restrictions required by law, if any, representing the number of shares of Common Stock being acquired upon the mandatory conversion of this Note; provided, however that the Company shall not be obligated to issue certificates evidencing the equity securities issuable upon conversion of this Note, until the Note is either delivered for conversion to the Company or any transfer Holder of the Note or Common Stock, or the Holder notifies the Company that the Note have been lost, stolen or destroyed and provides a lost instrument indemnity or bond to the Company to indemnify the Company from any loss incurred by it in connection therewith. The Company covenants and agrees that it shall comply with Sections 3(d) through (g) with respect to any mandatory conversion and such sections are incorporated by reference herein.
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Section 5. Payment of Principal and Redemption.
(a) In the event of an occurrence of an Event of Default, then the outstanding principal balance of this Note shall be due and payable in full on the Maturity Date. Prior to the Mandatory Conversion Date this Note may not be prepaid.
(b) Nothing in this Section 5 shall impair the Holder’s right to convert this Note pursuant to Section 3 prior to the Mandatory Conversion Date.
Section 6. Definitions. For the purposes hereof, the following terms shall have the following meanings:
“Business Day” shall mean any day, except a Saturday, Sunday or other day on which commercial banks in the State of California are authorized or required by law to close.
“Conversion Ratio” means, at any time, a fraction, of which the numerator is the outstanding principal amount represented by any Note plus accrued but unpaid interest, and of which the denominator is the Conversion Price at such time.
“Original Issue Date” means the date of the first issuance of this Note regardless of the number transfers hereof.
Section 7. Stockholder Rights. This Note shall not entitle the Holder to any of the rights of a stockholder of the Company, including without limitation, the right to vote, to receive dividends and other distributions, or to receive any notice of, or to attend, meetings of stockholders or any other proceedings of the Company, unless and to the extent converted into shares of Common Stock in accordance with the terms hereof.
Section 8. Lost Note. If this Note shall be mutilated, lost, stolen or destroyed, the Company shall execute and deliver, in exchange and substitution for and upon cancellation of a mutilated Note, or in lieu of or in substitution for a lost, stolen or destroyed debenture, a new Note for the principal amount of this Note so mutilated, lost, stolen or destroyed but only upon receipt of evidence of such loss, theft or destruction of such Note, and of the ownership hereof, and indemnity or bond, if requested, all reasonably satisfactory to the Company.
Section 9. Governing Law. This Note shall be governed by and construed in accordance with the laws of the State of California, without giving effect to conflicts of laws thereof.
Section 10. Notices. All notices or other communications hereunder shall be given, and shall be deemed duly given and received, if given, in the manner set forth in Section 5(h).
Section 11. Waiver. Any waiver by the Company or the Holder a breach of any provision of this Note shall not operate as or be construed to be a waiver of any other breach of such provision or of any breach of any other provision of this Note. The failure of the Company or the Holder to insist upon strict adherence to any term of this Note on one or more occasions shall not be considered a waiver or deprive that party of the right thereafter to insist upon strict adherence to that term or any other term of this Note. Any waiver must be in writing.
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Section 12. Severability. If any provision of this Note is invalid, illegal or unenforceable, the balance of this Note shall remain in effect, and if any provision is inapplicable to any person or circumstance, it shall nevertheless remain applicable to all other persons and circumstances.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed by an officer thereunto duly authorized as of the date first above indicated.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.
| VG LIFE SCIENCES INC., | ||
| a Delaware corporation | ||
| By: | /s/ Haig Keledjian | |
Name: Haig Keledjian Title: Chairman | ||
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EXHIBIT A
NOTICE OF CONVERSION
AT THE ELECTION OF HOLDER
(To be Executed by the Registered Holder in order to Convert the Note)
The undersigned hereby irrevocably elects to convert the above Note into shares of Common Stock, no par value per share (the “Common Stock”), of VG Life Sciences Inc. (the “Company”) according to the conditions hereof, as of the date written below. If shares are to be issued in the name of a person other than undersigned, the undersigned will pay all transfer taxes payable with respect thereto and is delivering herewith such certificates and opinions as reasonably requested by the Company in accordance therewith. No fee will be charged to the Holder for any conversion, except for such transfer taxes, if any.
| Conversion calculations: | ||
| Date to Effect Conversion | ||
| Principal Amount of Notes to be Converted | ||
| Applicable Conversion Price | ||
| Signature | ||
| Name: | ||
| Address: |
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Schedule of Cash Proceeds from Wild Harp Holdings, LLC
and Received by VG Life Sciences Inc.
| July 9, 2014 | $100,000.00 | |
| September 16, 2014 | $50,000.00 | |
| October 27, 2014 | $50,000.00 | |
| $___________ | ||
Date: ______________ |
||
| $___________ | ||
Date: ______________ |
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Exhibit 10.151
EXHIBIT B(2)
WARRANT TO PURCHASE STOCK
Company: VG Life Sciences Inc.
Number of Shares: 200,000
Class of Stock: Common
Initial Exercise Price Per Share: $0.49
Issue Date: October 27, 2014
THIS WARRANT CERTIFIES THAT, for good and valuable consideration, Wild Harp Holdings, LLC, a California limited liability company (“Holder”) is entitled to purchase the number of fully paid and nonassessable shares of the class of securities (the “Shares”) of VG Life Sciences Inc. (the “Company” or “VGLS”) at the initial exercise price per Share (the “Warrant Price”) all as set forth above and as adjusted pursuant to Article 2 of this Warrant, subject to the provisions and upon the terms and conditions set forth of this Warrant.
ARTICLE 1. EXERCISE
1.1 Method of Exercise. Holder may exercise this Warrant by delivering a duly executed Notice of Exercise in substantially the form attached as Appendix 1 to the principal office of the Company. Unless Holder is exercising the conversion right set forth in Section 1.2, Holders shall also deliver to the Company a check for the aggregate Warrant Price for the Shares being purchased.
1.2 Conversion Right. In lieu of exercising this Warrant as specified in Section 1.1, Holder may from time to time convert this Warrant, in whole or in part, into a number of Shares determined by dividing (a) the aggregate fair market value of the Shares or other securities otherwise issuable upon exercise of this Warrant minus the aggregate Warrant Price of such Shares by (b) the fair market value of one Share. The fair market value of the Shares shall be determined pursuant Section 1.4.
1.3 No Rights Shareholder. This Warrant does not entitle Holder to any voting rights as a shareholder of the Company prior to the exercise hereof.
1.4 Fair Market Value. For purposes of Section 1.2, if the Shares are traded in a public market, the fair market value of the Shares shall be the closing price of the Shares (or the closing price of the Company’s stock into which the Shares are convertible) reported for the business day immediately before Holder delivers its Notice of Exercise to the Company. If the Shares are not traded in a public market, the Board of Directors of the Company shall determine fair market value in its reasonable good faith judgment. The foregoing notwithstanding, if Holder advises the Board of Directors in writing that Holder disagrees with such determination, then the Company and Holder shall promptly agree upon a reputable investment banking or public accounting firm to undertake such valuation. If the valuation of such investment banking firm is greater than that determined by the Board of Directors, then all fees and expenses of such investment banking firm shall be paid by the Company. In all other circumstances, such fees and expenses shall be paid by Holder.
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1.5 Delivery of Certificate and New Warrant. Promptly after Holder exercises or converts this Warrant, the Company shall deliver to Holder certificates for the Shares acquired and, if this Warrant has not been fully exercised or converted and has not been fully exercised or converted and has not expired, a new Warrant representing the Shares not so acquired.
1.6 Replacement of Warrants. On receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant and, in the case of loss, theft or destruction, on delivery of an indemnity agreement reasonably satisfactory in form and amount to the Company or, in the case of mutilation, or surrender and cancellation of this Warrant, the Company at its expense shall execute and deliver, in lieu of this Warrant, a new warrant of like tenor.
1.7 Repurchase on Sale, Merger, or Consolidation of the Company
1.7.1 “Acquisition” For the purpose of this Warrant, “Acquisition” means (a) the closing of the sale, transfer or other disposition of all or substantially all of the VGLS’s assets, (b) the consummation of the merger or consolidation of VGLS with or into another entity (except a merger or consolidation in which the holders of capital stock of VGLS immediately prior to such merger or consolidation continue to hold at least fifty percent (50%) of the voting power of the capital stock of VGLS or the surviving or acquiring entity), or any transaction or series of transactions to which VGLS is a party in which in excess of fifty percent (50%) of VGLS’s voting power is transferred, or (c) the exclusive license of all or substantially all of the intellectual property of VGLS to a third party.
1.7.2 Assumption of Warrant. Upon the closing of any Acquisition the successor entity shall assume the obligations of this Warrant, and this Warrant shall be exercisable for the same securities, cash, and property as would be payable for the Shares issuable upon exercise of the unexercised portion of this Warrant as if such Shares were outstanding on the record date for the Acquisition and subsequent closing.
1.7.3 Purchase Right. At the election of Holder, the Company shall purchase the unexercised portion of this Warrant for cash upon the closing of any Acquisition for an amount equal to (a) the fair market value of any consideration that would have been received by Holder in consideration of the Shares had Holder exercised the unexercised portion of this Warrant immediately before the record date for determining the shareholders entitled to participate in the proceeds of the Acquisition, less (b) the aggregate Warrant Price of the Shares, but in no event less than zero.
ARTICLE 2. ADJUSTMENTS TO THE SHARES.
2.1 Stock Dividends, Splits, Etc. If the Company declares or pays a dividend on its common stock ( or the Shares if the Shares are securities other than common stock ) payable in common stock, or other securities, subdivides the outstanding common stock into a greater amount of common stock, or, if the Shares are securities other than common stock, subdivides the Shares in a transaction that increases the amount of common stock into which the Shares are convertible, then upon exercise of this Warrant, for each Share acquired, Holder shall receive, without cost to Holder, the total number and kind of securities to which Holder would have been entitled had Holder owned the Shares of record as of the date the dividend or subdivision occurred.
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2.2 Reclassification, Exchange or Substitution. Upon any reclassification, exchange, substitution, or other event that results in a change of the number and/or class of the securities issuable upon exercise or conversion of this Warrant, Holder shall be entitled to receive, upon exercise or conversion of this Warrant, the number and kind of securities and property that Holder would have received for the shares if this Warrant had been exercised immediately before such reclassification, exchange, substitution, or other event. Such an event shall include any automatic conversion of the outstanding or issuable securities of the Company of the same class or series as the Shares to common stock pursuant to the terms of the Company’s Certificate of Incorporation upon the closing of a registered public offering of the Company’s common stock. The Company or its successor shall promptly issue to Holder a new Warrant for such new securities or other property. The new adjustments provided for in this Article 2 including, without limitation, adjustments to the Warrant Price and to the number of securities or property issuable upon exercise of the new Warrant. The provisions of this Section 2.2 shall similarly apply to successive reclassifications, exchanges, substitutions, or other events.
2.3 Adjustments for Combinations, Etc. If the outstanding Shares are combined or consolidated, by reclassification or otherwise, into a lesser number of shares, the Warrant price shall be proportionately increased.
2.4 Adjustments for Diluting Issuances. The number of shares of common stock issuable upon conversion of the Shares, shall be subject to adjustment, from time to time in the manner set forth in the Company’s Certificate of Incorporation with respect to issuance of securities for a price lower than certain prices specified in the Certificate of Incorporation.
2.5 No Impairment. The Company shall not, by amendment of its Certificate of Incorporation or through a reorganization, transfer of assets, consolidation, merger, dissolution, issue, or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms to be observed or performed under this Warrant by the Company, but shall at all times in good faith assist in carrying out of all the provisions of this Article 2 and in taking all such action as may be necessary or appropriate to protect Holder’s rights under this Article against impairment. If the Company takes any action affecting the Shares or its common stock other than as described above that adversely affects Holder’s rights under this Warrant, the Warrant Price shall be adjusted downward and the number of Shares issuable upon exercise of this Warrant shall be adjusted upward in such a manner that the aggregate Warrant price of this Warrant is unchanged.
2.6 Fractional Shares. No fractional Shares shall be issuable upon exercise or conversion of the Warrant and the number of Shares to be issued shall be rounded down to the nearest whole Share. If a fractional share interest arises upon any exercise or conversion of the Warrant, the Company shall eliminate such fractional share interest by paying Holder amount computed by multiplying the fractional interest by the fair market value of a full Share.
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2.7 Certificate as to Adjustments. Upon each adjustment of the Warrant Price, the Company at its expense shall promptly compute such adjustment, and furnish Holder with a certificate of its Chief Financial Officer setting forth such adjustment and the facts upon which such adjustment is based. The Company shall, upon written request, furnish Holder a certificate setting forth the Warrant price in effect upon the date thereof and the series of adjustments leading to such Warrant Price.
ARTICLE 3. REPRESENTATIONS AND COVENANTS OF THE COMPANY.
3.1 Representations and Warranties. The Company hereby represents and warrants to the Holder that all Shares which may be issued upon the exercise of the purchase right represented by this Warrant and all securities, if any, issuable upon conversion of the Shares, shall, upon issuance, be duly authorized, validly issued, fully paid and nonassessable, and free of any liens and encumbrances except for restrictions on transfer provided for herein or under applicable federal and state securities laws.
3.2 Notice of Certain Events. If the Company proposes at any time (a) to declare any dividend or distribution upon its common stock, whether in cash, property, stock or other securities and whether or not a regular cash dividend; (b) to offer for subscription pro rata to the holders of any class or series or other rights; (c) to effect any reclassification or recapitalization of common stock; (d) to merge or consolidate with or into any other corporation, or sell, lease, license, or convey all or substantially all of its assets, or to liquidate, dissolve or wind up; or (e) offer holders of registration rights the opportunity to participate in an underwritten public offering of the Company’s securities for cash, then, in connection with each such event, the Company shall give Holder (1) at least 20 days prior written notice of the date on which a record will be taken for such dividend, distribution or subscription rights (and specifying the date on which the holders of common stock will be entitled thereto) or for determining rights to vote, if any, in respect of the matters referred to in (c) and (d) above; 2 in the case of the matters referred to in (c) and (d) above at least 20 days prior written notice of the date when the same will take place (and specifying the date on which the holders of common stock will be entitled to exchange their common stock for securities or other property deliverable upon the occurrence of such event); and (3) in the case of the matter referred to in (e) above, the same notice as is given to the holders of such registration rights.
3.3 Information Rights. So long as the Holder holds this Warrant and /or any of the Shares, the Company shall deliver to the Holder (a) promptly after mailing, copies of all notices or other written communications to the shareholders of the Company, (b) within ninety (90) days after the end of each fiscal year of the Company, the annual financial statements of the Company.
3.4 Registration Under Securities Act of 1933, as amended. The Company agrees that the Shares shall be subject to the registration rights granted to any other holders of the Company’s common stock.
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ARTICLE 4. MISCELLANEOUS.
4.1 Term. This Warrant is exercisable, in whole or in part, at any time and from time to time on or after the fourth anniversary of the Issue Date hereof and up to and including the fifth anniversary of the Issue Date.
4.2 Legends. This Warrant and the Shares (and the securities issuable, directly or indirectly, upon conversion of the Shares, if any) shall be imprinted with a legend in substantially the following form:
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, PLEDGED OR OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT OR PURSUANT TO RULE 144 OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE CORPORATION AND ITS COUNSEL THAT SUCH REGISTRATION IS NOT REQUIRED.
4.3 Compliance with Securities Laws on Transfer. This Warrant and the Shares issuable upon exercise this Warrant (and the securities issuable, directly or indirectly, upon conversion of the shares, if any) may not be transferred or assigned in whole or in part without compliance with limitation, the delivery of investment representation letters and legal opinions reasonably satisfactory to the Company, as reasonable requested by the Company). The Company shall not require Holder to provide an opinion of counsel if the transfer is to an affiliate of Holder or if there is no material question as to the availability of current information as referenced in rule 144(c), Holder represents that it has complied with Rule 144(d) and (e) in reasonable detail, the selling broker represents that it has complied with Rule 144(f), and the Company is provided with a copy of Holder’s notice of proposed sale.
4.4 Transfer Procedure. Subject to the provisions of Section 4.2, Holder may transfer all or part of this Warrant or the Shares issuable upon exercise of this Warrant (or the securities issuable, directly or indirectly, upon conversion of the Shares, if any) by giving the Company notice of the portion of the Warrant being transferred setting forth the name, address and taxpayer identification number of the transferee and surrendering this Warrant to the Company for reissuance to the transferee(s) (and Holder if applicable).
4.5 Notices. All notices and other communications from the Company to the Holder, or vice versa, shall be deemed delivered and effective when given personally or mailed by first-class registered or certified mail, postage prepaid, at such address as may have been furnished to the Company or the Holder, as the case may be, in writing by the Company or such Holder from time to time.
4.6 Waiver. This Warrant and any term hereof may be changed, waived, discharged or terminated only by an instrument in writing signed by the party against which enforcement of such change, waiver, discharge or termination is sought.
| 5 |
4.7 Attorneys Fees. In the event of any dispute between the parties concerning the terms and provisions of this Warrant , the party prevailing in such dispute shall be entitled to collect from the other party all costs incurred in such dispute, including reasonable attorney’s fees.
4.8 Governing Law. This Warrant shall be governed by and construed in accordance with the laws of the State of California, without giving effect to its principles regarding conflicts of law.
| /s/ Haig Keledjian | ||
| By: Haig Keledjian | ||
| Title: Chairman | ||
| 6 |
APPENDIX 1
NOTICE OF EXERCISE
1. The undersigned hereby elects to convert the attached Warrant into in the manner specified in the Warrant. This conversion is exercised with respect to _______________________ of the Shares covered by the Warrant.
2. Please issue a certificate or certificates representing said shares in the name of the undersigned or in such other name as is specified below:
______________________________________
(Name)
________________________________________
________________________________________
(Address)
3. The undersigned represents it is acquiring the shares solely for its own account and not as a nominee for any other party and not with a view toward the resale or distribution thereof except in compliance with applicable securities laws.
| (Date) | (Signature) |
| 7 |
Exhibit 31.1
CERTIFICATION OF CHIEF EXECUTIVE OFFICER PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
(18 U.S.C. SECTION 1350)
I, John Tynan, certify that:
1. I have reviewed this quarterly report on Form 10-Q of VG Life Sciences Inc. for the quarter ended September 30, 2014;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
| By: | /s/ John Tynan | ||
| Date: November 13, 2014 | John Tynan | ||
| Chief Executive Officer | |||
| (Principal Executive Officer) |
Exhibit 31.2
CERTIFICATION OF CHIEF FINANCIAL OFFICER PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
(18 U.S.C. SECTION 1350)
I, David Odell, certify that:
1. I have reviewed this quarterly report on Form 10-Q of VG Life Sciences Inc. for the quarter ended September 30, 2014;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
| By: | /s/ David Odell | ||
| Date: November 13, 2014 | David Odell | ||
|
Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer) | |||
Exhibit 32.1
CERTIFICATION PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
(18 U.S.C. SECTION 1350)
Pursuant to section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of section 1350, chapter 63 of title 18, United States Code), the undersigned officers of VG Life Sciences Inc., a Delaware corporation (the “Company”), do hereby certify, to such officers’ knowledge, that:
The Quarterly Report on Form 10-Q for the quarter ended September 30, 2014 (the “Form 10-Q”) of the Company fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, and the information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.
| Date: November 13, 2014 | By: | /s/ John Tynan | |
|
John Tynan Chief Executive Officer (Principal Executive Officer) |
|||
| Date: November 13, 2014 | By: | /s/ David Odell | |
|
David Odell Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer) | |||
|
4. Convertible Debt - Related Parties
|
9 Months Ended |
|---|---|
|
Sep. 30, 2014
|
|
| Related Party Transactions [Abstract] | |
| 4. Convertible Debt - Related Parties |
In the nine month period ended September 30, 2014, the Company entered into Convertible Promissory Notes (“Notes”) and Warrant Purchase Agreements with three related party entities: on July 9, 2014 with Wild Harp Holdings, LLC (“Wild Harp”) controlled by John Tynan, our CEO, and DW Odell Company (“DW Odell”) controlled by David Odell, our CFO, and on August 27, 2014, with Medbridge Development Company, LLC (“MDC”), an entity controlled by Mr. Tynan and Mr. Odell. John Tynan and David Odell are officers and directors of the Company. The Wild Harp and DW Odell agreements provide for Notes of up to $250,000 each to be purchased at the option of each party through July 9, 2015, of which $150,000 has been received from each of Wild Harp and DW Odell through September 30, 2014. The MDC agreement provides for a Note of $50,000, proceeds of which were received from MDC on August 27, 2014. All three Notes bear interest at 8% per annum and have a two year term. Principal and accrued interest are convertible in four equal quarterly tranches of principal, plus accrued interest commencing 15 months after the issuance date of each Note, or at any time at each party’s option, at the conversion price. The Wild Harp and DW Odell balances are each comprised of two Notes having identical conversion provisions; (i) a Note with $100,000 in principal with a conversion rate of $0.1245 and warrant exercise price of $0.93 per share and (ii) a Note with $50,000 in principal with a conversion rate of $0.084 and warrant exercise price of $0.63 per share. The MDC Note of $50,000 has a conversion price of $0.1134 and a warrant exercise price of $0.85 per share. The warrants received by the parties are to purchase four common shares for each $1 of principal, an aggregate of 1,400,000 shares as of September 30, 2014, exercisable on any date from the four-year anniversary to the five-year anniversary of the agreement. Similar warrants will be issued with future Wild Harp and DW Odell note proceeds of up to $200,000, if any; exercisable at 7.5 times the corresponding conversion price. All warrants include a cashless exercise provision. These Notes issued through September 30, 2014, are convertible into 3,237,819 shares of common stock of the Company. |