Exhibit 10.1

 

THE SECURITIES OFFERED HEREBY HAVE NOT BEEN AND WILL NOT BE REGISTERED WITH THE
UNITED STATES SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF
ANY STATE PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED BY SECTION 4(a)(2)
OF THE SECURITIES ACT OF 1933, AS AMENDED, AND THE RULES AND REGULATIONS
PROMULGATED THEREUNDER (THE 1933 ACT) $300,000.00 BIO-MATRIX SCIENTIFIC GROUP,
INC. CONVERTIBLE NOTE DUE April 1, 2016 

 

FOR VALUE TO BE RECIEVED, Bio-Matrix Scientific Group, Inc. (the “Company”)
promises to pay to the order of STARCITY CAPITAL, LLC, or its designee, and
authorized successors and permitted assigns (“Holder”), the aggregate principal
face amount of Three Hundred Thousand Dollars (U.S. $300,000.00) on or before
April 1, 2016. (“Maturity Date”). No interest shall accrue against such
principal balance. the principal of this Note is payable at 767 3rd Avenue,
#25-1a; New York, New York, 10017, initially, and if changed, last appearing on
the records of the Company as designated in writing by the Holder hereof from
time to time. The Company will pay the outstanding principal due upon this note
before or on the Maturity Date, less any amounts required by law to be deducted
or withheld, to the Holder of this Note by check or wire transfer addressed to
such Holder at the last address appearing on the records of the Company. The
forwarding of such check or wire transfer shall constitute a payment of
outstanding principal hereunder and shall satisfy and discharge the liability
for principal on this Note to the extent of the sum represented by such check or
wire transfer.

 

This Note is subject to the following additional provisions:

 

1. This Note is exchangeable for an equal aggregate principal amount of Notes of
different authorized denominations, as requested by the Holder surrendering the
same. No service charge will be made for such registration or transfer or
exchange, except the Holder shall pay any tax or other governmental charges
payable in connection therewith.

 

2. The Company shall be entitled to withhold from all payments any amounts
required to be withheld under applicable laws.

 

3. This Note may be transferred or exchanged only in compliance with the
Securities Act of 1933, as amended (“Act”) and applicable state securities laws.
Any attempted transfer to a non-qualifying party shall be treated by the Company
as void. Prior to due presentment for transfer of this Note, the Company and any
agent of the Company may treat the person in whose name this Note is duly
registered on the Company’s records as the owner hereof for all other purposes,
whether or not this Note be overdue, and neither the Company nor any such agent
shall be affected or bound by notice to the contrary. Any Holder of this Note
electing to exercise the right of conversion set forth in Section 4(a) hereof,
in addition to the requirements set forth in Section 4(a), and any prospective
transferee of this Note, also is required to give the Company written
confirmation that this Note is being converted (“Notice of Conversion”) in the
form annexed hereto as Exhibit A. The date of receipt (including receipt by
telecopy) of such Notice of Conversion shall be the Conversion Date.

 

4. In the event that payment to the Company by Starcity in accordance with
section 4(b) of that settlement agreement by and between the Company and
Starcity dated January 28, 2015 is not made on or before April 1, 2015, such
payment constituting consideration for the Note, ther terms and conditions of
this Note shall not be binding upon the Company.

 

5. Conversion Price and Discount.

 

a. The Holder of this Note is entitled, at its option, at any time after 180
days after the date the $52,500 payment is paid to the Company, in accordance
with section 4(b) of the settlement agreement, to conver all or any amount of
the principal face amount of this Note then outstanding into shares of the
Company’s common stock (the “Common Stock”) at a price (“Conversion Price”) for
each share of Common Stock equal to the greater of

 

(i) fifty five percent (55%) (the “Discount”) of the lowest closing bid price
for the Company’s common stock during the five (5) trading days immedialtely
preceeding a conversion date, as reported by Bloomberg (the”Closing Bid Price”)
(“Initial conversion Price”) or

(ii) $0.0001.

 

b. Notwithstanding the foregoing, other than as provided in 5 (p), the Holder
shall not have the right to convert its debt into shares which, when added to
such Holder’s other holdings in the Company stock, shall have caused such Holder
to hold more than 9.99% of the Company’s outstanding common stock.

 

c. Holder may sell the shares issued upon conversion immediately after issuance,
subject to all applicable securities laws.

 

d. So long as the requested sale of shares issued upon conversion satisfies the
safe harbor provisions of Rule 144 promulgated under the Securities Act of 1933
(“rule 144”), which allows holders of restricted seurities to make public sales
of those securities when certain conditions are met, the Company agrees to
accept an opinion of counsel to the Starcity, which opinion will be issued at
Starcity’s expense, and to issue the Common Shares without restrictive legend of
any kind.

 

e. On or before February 6, 2015, the Company shall issue an irrevocable
transfer agent instructions in the form attached hereto at Exhibit 1 reserving
500,000,000 shares of BMSN common stock for conversions under this Note (the
"Share Reserve"). In addition, on the date that is 180 days after payment by
Starcity to BMSN of $52,500, the share reserve shall be increased to equal the
number of shares necessary to fully convert the note at the ConversionPrice on
such date and an additional share reserve instruction, signed by the Company and
its Transfer Agent, shall be provided to Starcity in the form attached at
Exhibit 1. The Share Reserve shall be replenished as needed in the same manner
to allow for conversions of this Note. Upon full conversion of this Note, any
shares remaining in the Share Reserve shall be cancelled. The Company shall pay
all costs associated with issuing and delivering the shares. The Company should
at all times reserve a minimum number of shares equal to the number required if
the remaining balance of the note would be fully converted at the then
applicable Conversion Price. The Holder may reasonably request, and the Company
shall comply with all such reasonable requests, to increase the reserve from
time to time so that the reserve, at all times, includes such minimum number of
BMSN shares. In connection with each share increase, irrevocable instructions to
the transfer agent signed by the transfer agent and the Company shall be
provided to Starcity in the form attached hereto at Exhibit 1.

 

f. In the event that Starcity fails to fund the loan by making a payment of
$52,500 to BMSN on or before April 1, 2015, BMSN’s obligations under this
Convertible Note shall be terminated, cancelled and relinquished and all shares
so reserved shall be free from reserve and shall be free from the terms of the
irrevocable transfer agent instruction letter at Exhibit 1.

 

g. As of February 1, 2015, the Company has provided all Current Public
Information as defined in Rule 144(c) and has filed with the SEC all reports
required to be filed under the Securities Exchange Act of 1934 (the "SEC
Reports") and covenants to file all required SEC Reports until the maturity date
of the Company's Note.

 

h. As of February 1, 2015, except as specifically disclosed in its SEC Reports,
there has been no event, occurrence or development that, individually or in the
aggregate, has had or that could reasonably be expected to result in a Material
Adverse Effect, neither the Company nor any of its Subsidiaries has incurred any
material liabilities other than those disclosed in the Company’s financial
statements pursuant to GAAP or required to be disclosed in filings made with the
SEC.

 

i. As of February 1, 2015, the Company has not altered its method of accounting
or the identity of its auditors.

 

j. As of February 1, 2015, the Company has not declared or made any dividend or
distribution of cash or other property to its stockholders, in their capacities
as such, or purchased, redeemed or made any agreements to purchase or redeem any
shares of its capital stock (except for repurchases by the Company of shares of
capital stock held by employees, officers, directors, or consultants pursuant to
an option of the Company to repurchase such shares upon the termination of
employment or services).

 

k. As of February 1, 2015 no representation or warranty or other statement made
by the Company or any Subsidiary in this Note or in its SEC Reports, contains
any untrue statement or omits to state a material fact necessary to make any
such statement, in light of the circumstances in which it was made, not
misleading.

 

l. The Company acknowledges that Starcity is expressly relying on the provisions
of this Section in entering into this Note and consummating the transactions
contemplated hereby.

 

m. Such conversion shall be effectuated by the Company delivering the shares of
Common Stock to the Holder within 3 business days of receipt by the Company of
the Notice of Conversion. If the shares have not been delivered within 3
business days, the Notice of Conversion may be rescinded.

 

n. Once the Holder has received such shares of Common Stock, the Holder shall
surrender this Note to the Company, executed by the Holder evidencing such
Holder's intention to convert this Note or a specified portion hereof, and
accompanied by proper assignment hereof in blank. No fractional shares or scrip
representing fractions of shares will be issued on conversion, but the number of
shares issuable shall be rounded to the nearest whole share. Other than as
provided in 5(p), in no event shall the Holder be allowed to effect a conversion
if such conversion, along with all other shares of Company Common Stock
beneficially owned by the Holder and its affiliates would exceed 9.99% of the
outstanding shares of the Common Stock of the Company.

 

o. This Note may not be prepaid.

 

p. Upon

(i) a transfer of all or substantially all of the assets of the Company to any
person in a single transaction or series of related transactions,

(ii) a reclassification, capital reorganization or other change or exchange of
outstanding shares of the Common Stock, or

(iii) any consolidation or merger of the Company with or into another person or
entity in which the Company is not the surviving entity (other than a merger
which is effected solely to change the jurisdiction of incorporation of the
Company and results in a reclassification, conversion or exchange of outstanding
shares of Common Stock solely into shares of Common Stock) (each of items (i),
(ii) and (iii) being referred to as a "Sale Event"), then, in each case, Holder
may convert the unpaid principal amount of this Note into shares of Common Stock
immediately prior to such Sale Event at the Conversion Price without regard to
the limitation of Section 4(b) of this Note.

 

q. No provision of this Note shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of this Note
at the time, place, and in the form, herein prescribed.

 

r. The Company hereby expressly waives demand and presentmentfor payment, notice
of non-payment, protest, notice of protest, notice of dishonor, notice of
acceleration or intent to accelerate, and diligence in taking any action to
collect amounts called for hereunder and shall be directly and primarily liable
for the payment of all sums owing and to be owing hereto.

 

s. The Company agrees to pay all costs and expenses, including reasonable
attorneys' fees and expenses, which may be incurred by the Holder in collecting
any amount due under this Note.

 

6. If one or more of the following described "Events of Default" shall occur:

 

a. The Company shall default in the payment of principal or interest on this
Note, the Settlement Agreement executed concurrently with this Note or any other
note issued to the Holder by the Company; or

 

b. Any of the representations or warranties made by the Company herein, in the
Settlement Agreement or in any certificate or financial or other written
statements heretofore or hereafter furnished by or on behalf of the Company in
connection with the execution and delivery of this Note, or the Settlement
Agreement pursuant to which this note was issued shall be false or misleading in
any respect; or

 

c. The Company shall fail to perform or observe, in any respect, any covenant,
term, provision, condition, agreement or obligation of the Company under this
Note, the Settlement Agreement or any other note issued to the Holder, and not
cure such failure within 10 days of such event; or

 

d. The Company shall

 

(1) become insolvent;

(2) admit in writing its inability to pay its debts generally as they mature;

(3) make an assignment for the benefit of creditors or commence proceedings for
its dissolution;

(4) apply for or consent to the appointment of a trustee, liquidator or receiver
for its or for a substantial part of its property or business;

(5) file a petition for bankruptcy relief, consent to the filing of such
petition or have filed against it an involuntary petition for bankruptcy relief,
all under federal or state laws as applicable; or

(6) a trustee, liquidator or receiver shall be appointed for the Company or for
a substantial part of its property or business without its consent and shall not
be discharged within thirty (30) days after such appointment; or

 

e. Any governmental agency or any court of competent jurisdiction at the
instance of any governmental agency shall assume custody or control of the whole
or any substantial portion of the properties or assets of the Company; or

 

f. One or more money judgments, writs or warrants of attachment, or similar
process, in excess of two hundred and fifty thousand dollars ($250,000) in the
aggregate, shall be entered or filed against the Company or any of its
properties or other assets and shall remain unpaid, unvacated, unbonded or
unstayed for a periodof fifteen (15) days or in any event later than five (5)
days prior to the date of any proposed sale thereunder; or

 

g. The Company shall have its Common Stock de1isted from its primary public
market or trading in the Common Stock shall be suspended for more than 10
consecutive days; or

 

h. The Company shall not deliver to the Holder the Common Stock to be issued
upon conversion of this Note within 3 business days of its receipt of a Notice
of Conversion; or

 

i. The Company shall not replenish the reserve as required in this Note, within
one hundred and twenty (120) business days of the request of the Holder.

 

j. The Company shall not be "current" in its filings with the Securities and
Exchange Commission; or

 

k. The Company shall lose the "bid" price for its stock in a market (including
the OTCQB marketplace or other exchange). Then, or at any time thereafter,
unless cured, and in each and every such case, unless such Event of Default
shall have been waived in writing by the Holder (which waiver shall not be
deemed to be a waiver of any subsequent default) at the option of the Holder and
in the Holder's sole discretion, the Holder may consider this Note immediately
due and payable, without presentment, demand, protest or (further) notice of any
kind (other than notice of acceleration), all of which are hereby expressly
waived, anything herein or in any note or other instruments contained to the
contrary notwithstanding, and the Holder may immediately, and without expiration
of any period of grace, enforce any and all of the Holder's rights and remedies
provided herein or any other rights or remedies afforded by law.

 

7. STARCITY’S REPRESENTATIONS AND WARRANTIES. Starcity represents and warrants
to the Company that:

 

a. This Note is acquired for the Holder’s account only for investment purposes
only and not with a view towards, or for resale in connection with, the public
sale or distribution thereof, nor with any present intention of distributing or
selling the same, and it has no present or contemplated agreement, undertaking,
arrangement, obligation, indebtedness or commitment providing for the
disposition thereof; provided however; that by making the representations
herein, Starcity does not agree to hold the Note or any portion thereof or any
Common Stock issued upon conversion of for any minimum or other specific term
and reserves the right to dispose of the Note or any of such Common Stock at any
time in accordance with or pursuant to a registration statement or an exemption
under the 1933 Act and applicable state securities laws.

 

b. Reliance on Exemptions. Starcity understands that the Note is issued to it by
the Company in reliance upon specific exemptions from the registration
requirements of United States federal and state securities laws and the Company
is relying upon the truth andaccuracy of, and Starcity's compliance with, the
representations, warranties, agreements, acknowledgments and understandings of
Starcity set forth herein in order to determine the availability of such
exemptions and the eligibility of Starcity to acquire this security.

 

c. Non-affiliate Status. Starcity is not, and has not for in excess of ninety
(90) days been, and subsequent to the closing of this transaction not be, an
"Affiliate" of the Company, as that term is defined by Rule 144 under the 1933
Act. Starcity is not acting in concert with any other person in a manner that
would require their sales of securities to be aggregated for purposes of Rule
144 or would cause Starcity to be considered an "Underwriter" as that term is
defined by Section 2 of the 1933 Act.

 

d. Company Information. Starcity and its advisors, if any, have been furnished
with all materials relating to the business, finances and operations of the
Company, including copies of the Company’s most recent publicly available
financial statements as available as of December 31, 2014 on the SEC's EDGAR
system. Starcity and its advisors have been afforded the opportunity to ask
questions of the Company. Neither such inquiries nor any other due diligence
investigation conducted by Starcity shall modify, amend or affect Starcity's
right to rely on the Company's representations and warranties contained below.
Starcity understands that its investment, including but not limited to this Note
(and/or in the Common Stock issuable thereunder), involves a significant degree
of risk.

 

e. Governmental Review. Starcity understands that no United States federal or
state agency or any other government or governmental agency has passed upon or
made any recommendation or endorsement of the Note or the rights to principal,
interest or conversion of the same into stock.

 

f. Transfer or Resale. Starcity understands that

 

(i) the sale or resale of the Note or any portion thereof and the Common Stock
issuable thereunder has not been registered under the 1933 Act or any applicable
state securities laws, and the Note and the Common Stock issuable thereunder may
not be transferred unless

 

(a) such security is sold pursuant to an effective registration statement under
the 1933 Act,

(b) the security is sold or transferred pursuant to an exemption from such
registration;

(c) the security is sold or transferred to an "affiliate" (as defined in Rule
144 promulgated under the 1933 Act or a successor rule; "Rule 144") of Starcity
who agrees to sell or otherwise transfer the security only in accordance with
this Section and who is an Accredited Investor, or

(d) (i) the Common Stock is sold pursuant to Rule 144, if such Rule is
available;

 

(ii) any sale of such Common Stock made in reliance on Rule 144 may be made only
in accordance with theterms of said Rule and further, if said Rule is not
applicable, any resale of such Common Stock under circumstances in which the
seller (or the person through whom the sale is made) may be deemed to be an
underwriter (as that term is defined in the 1933 Act) and may require compliance
with some other exemption under the 1933 Act or the rules and regulations of the
SEC thereunder.

 

g. Authorization; Enforcement. This Note has been duly and validly authorized by
Starcity. This Note has been duly executed and delivered on behalf of Starcity,
and this Note constitutes a valid and binding agreement of Starcity enforceable
in accordance with its terms, except as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or
similar laws relating to, or affecting generally, the enforcement of creditors'
rights and remedies or by other equitable principles of general application.

 

h. No Brokers. Starcity has taken no action which would give rise to any claim
by any person for brokerage commissions, finder's fees or similar payments
relating to this Note or the transactions contemplated hereby.

 

8. REPRESENTATIONS AND WARRANTIES OF the Company. the Company represents and
warrants to Starcity that:

 

a. Authorization; Enforcement.

(i) the Company has all requisite power and authority to enter into and perform
this Note and to consummate the transactions contemplated hereby and to sell the
relevant Purchased Note in accordance with the terms hereof,

(ii) the execution and delivery of this Note by the Company and the consummation
by it of the transactions contemplated hereby have been duly authorized by the
Company and no further consent or authorization of the Company or any person is
required,

(iii) this Note has been duly executed and delivered by the Company, and

(iv) this Note constitutes a legal, valid and binding obligation of the Company
enforceable against the Company in accordance with its terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, liquidation or similar laws relating to, or
affecting generally, the enforcement of creditors' rights and remedies or by
other equitable principles of general application.

 

b. No Conflicts. The execution, delivery and performance of this Note by the
Company and the consummation by the Company of the transactions contemplated
hereby will not

 

(i) violate or conflict with, or result in a breach of any provision of, or
constitute a default (or an event which with notice or lapse of time or both
could become a default) under, or give to others any rights of termination,
amendment, acceleration or cancellation of, any agreement, note, bond, indenture
or other instrument to which the Company is a party, or

 

(ii) result in a violation of any law, rule, regulation, order, judgment or
decree (including federal and state securities laws and regulations and
regulations of any selfregulatory organizations to which the Company is subject)
applicable to the Company or by which any property of the Company is bound or
affected. Except as specifically contemplated by this Note and as required under
the 1933 Act and any applicable federal and state securities laws, the Company
is not required to obtain any consent, authorization or order of, or make any
filing or registration with any court, governmental agency, regulatory agency,
self-regulatory organization or stock market or any third party in order for it
to execute, deliver or perform any of its obligations under this Note in
accordance with the terms hereof. Except for filings that may be required under
applicable federal and state securities laws in connection with the issuance and
sale of the Company's Note, all consents, authorizations, orders, filings and
registrations which the Company is required to obtain pursuant to the preceding
sentence have been obtained or effected on or prior to the date hereof.

 

c. No Brokers. The Company has taken no action which would give rise to any
claim by any person for brokerage commissions, finder's fees or similar payments
relating to this Note or the transactions contemplated hereby.

 

d. No Other Representations. The Company makes no other representations or
warranties with respect to the Company, its financial status, earnings, assets,
liabilities, corporate status or any other matter.

 

9. GOVERNING LAW; MISCELLANEOUS.

 

a. Governing Law; Jurisdiction. THIS NOTE SHALL BE ENFORCED, GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA APPLICABLE TO
AGREEMENTS MADE AND TO BE PERFORMED ENTIRELY WITH SUCH STATE, WITHOUT REGARD TO
THE PRINCIPLES OF CONFLICT OF LAWS. THE PARTIES HERETO HEREBY SUBMIT TO THE
EXCLUSIVE JURISDICTION OF THE UNITED STATES FEDERAL COURTS LOCATED IN THE CITY
OF SAN DIEGO, CALIFORNIA WITH RESPECT TO ANY DISPUTE ARISING UNDER THIS NOTE.
THE AGREEMENTS ENTERED INTO IN CONNECTION HEREWITH OR THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY. BOTH PARTIES IRREVOCABLY WAIVE THE DEFENSE OF AN
INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH SUIT OR PROCEEDING. BOTH PARTIES
FURTHER AGREE THAT SERVICE OF PROCESS UPON A PARTY MAILED BY FIRST CLASS MAIL
SHALL BE DEEMED IN EVERY RESPECT EFFECTIVE SERVICE OF PROCESS UPON THE PARTY IN
ANY SUCH SUIT OR PROCEEDING. NOTHING HEREIN SHALL AFFECT ANY PARTY'S RIGHT TO
SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW. THE PARTIES AGREE THAT A
FINAL NON-APPEALABLE JUDGMENT IN ANY SUCH SUIT OR PROCEEDING SHALL BE CONCLUSIVE
AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON SUCH JUDGMENT OR IN ANY
OTHER LAWFUL MANNER. THE PARTIES HEREBY WAIVE A TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM BROUGHT BY EITHER OF THE PARTIES HERETO AGAINST THE
OTHER IN RESPECT OF ANY MATTER ARISING OUT OF OR IN CONNECTION WITH THIS NOTE.

 

b. Counterparts; Signatures by Facsimile. This Note may be executed in one or
more counterparts, each of which shall be deemed an original but all of which
shall constitute one and the same agreement and shall become effective when
counterparts have been signed by each party and delivered to the other party.
This Note, once executed by a party, may be delivered to the other party hereto
by facsimile transmission of a copy of this Note bearing the signature of the
party so delivering this Note.

 

c. Headings. The headings of this Note are for convenience of reference only and
shall not form part of, or affect the interpretation of, this Note.

 

e. Severability. In the event that any provision of this Note is invalid or
enforceable under any applicable statute or rule of law, then such provision
shall be deemed inoperative to the extent that it may conflict therewith and
shall be deemed modified to conform with such statute or rule of law. Any
provision hereof which may prove invalid or unenforceable under any law shall
not affect the validity or enforceability of any other provision hereof.

 

f. Entire Agreement; Amendments. This Note, the Settlement Agreement executed
herewith and the exhibits and instruments referenced herein and therein contain
the entire understanding of the parties with respect to the matters covered
herein and therein and, except as specifically set forth herein or therein,
neither the Company nor Starcity makes any representation, warranty, covenant or
undertaking with respect to such matters. No provision of this Note may be
waived or amended other than by an instrument in writing signed by the party to
be charged with enforcement.

 

10. Notices. Any notices required or permitted to be given under the terms of
this Agreement shall be sent by certified or registered mail (return receipt
requested) or delivered personally or by courier (including a recognized
overnight delivery service, which may include UPS, Fedex or UnitedStates Postal
Service) or by facsimile and shall be effective five days after being placed in
the mail, if mailed by regular United States mail, or upon receipt, if delivered
personally or by courier (including a recognized overnight delivery service) or
by facsimile, in each case addressed to a party. The addresses for such
communications shall be as provided in the Settlement Agreement between the
parties executed concurrently with this Note. The Company may change its address
by notice similarly given to each Starcity. Each Starcity may change its address
by notice similarly given to the Company.

 

11. Successors and Assigns. This Note shall be binding upon and inure to the
benefit of the parties and their successors and assigns. Neither the Company nor
Starcity shall assign this Note or any rights or obligations hereunder without
the prior written consent of the other. Notwithstanding the foregoing, Starcity
also may assign its rights hereunder without further consent of the Company to
any person that purchases the same in a private transaction from Starcity or to
any of Starcity’s or its members’ affiliates, without the consent of the
Company.

 

12. Third Party Beneficiaries. This Note is intended for the benefit of the
Parties hereto and their respective permitted successors and assigns; and is not
for the benefit of, nor may any provision hereof be enforced by, any other
person.

 

13. Further Assurances. Each party shall do and perform, or cause to be done and
performed, all such further acts and things, and shall execute and deliver all
such other agreements, certificates, instruments and documents, as the other
party may reasonably request in order to carry out the intent and accomplish the
purposes of this Note and the consummation of the transactions contemplated
hereby.

 

14. If the Holder shall commence an action or proceeding to enforce any
provisions of this Note, including, without limitation, engaging an attorney,
then if the Holder prevails in such action, the Holder shall be reimbursed by
the Company for its attorneys' fees and other costs and expenses incurred in the
investigation, preparation and prosecution of such action or proceeding.

 

15. In case any provision of this Note is held by a court of competent
jurisdiction to be excessive in scope or otherwise invalid or unenforceable,
such provision shall be adjusted rather than voided, if possible, so that it is
enforceable to the maximum extent possible, and the validity and enforceability
of the remaining provisions of this Note will not in any way be affected or
impaired thereby.

 

16. Neither this Note nor any term hereof may be amended, waived, discharged or
terminated other than by a written instrument signed by the Company and the
Holder.

 

17. The Company represents that it is not a "shell" issuer and has never been a
"shell" issuer or that if it previously has been a "shell" issuer that at least
12 months have passed since the Company has reported form 10 type information
indicating it is no longer a "shell issuer. Further, the Company will instruct
its counsel to either (i) write a 144-3(a)(9) opinion to allow for salability of
the conversion shares or (ii) accept such opinion from Holder's counsel.

 

18. The Company will give the Holder direct notice of any corporate actions
including but not limited to name changes, stock splits, recapitalizations etc.
This notice shall be given to the Holder as soon as possible under law.

 

In Witness Whereof the Company has caused the Note to be duly executed by an
officer thereunto duly authorized.

 

BIO MATRIX SCIENTIFIC GROUP, Inc.

 

By: /s/David R Koos

David R. Koos

Its: Chief Executive Officer