Document:

Exhibit 10.107

 

 

NEITHER THIS SECURITY NOR THE SECURITIES
INTO WHICH THIS SECURITY IS CONVERTIBLE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE SECURITIES ACT),
AND ACCORDINGLY MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT
TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THIS NOTE
DOES NOT REQUIRE PHYSICAL SURRENDER HEREOF IN ORDER TO EFFECT A PARTIAL PAYMENT, REDEMPTION, OR CONVERSION HEREOF. ACCORDINGLY,
THE OUTSTANDING PRINCIPAL AMOUNT OF THIS Note MAY BE LESS THAN THE PRINCIPAL AMOUNT SHOWN BELOW.

 

VG LIFE SCIENCES INC.

 

CONVERTIBLE NOTE

 

	San Marino, California	$20,300
	Issue Date: January 1, 2013	Maturity Date: December 31, 2014

 

FOR VALUE RECEIVED,
VG Life Sciences Inc., a Delaware corporation formerly known as Viral Genetics, Inc., whose address is 2290 Huntington Drive,
Suite 100, San Marino, California, 91108, ("Borrower"), promises to pay to or to the order of Michael Capizzano
("Lender"), and his successors and assigns, in lawful money of the United States of America, twenty thousand and
three hundred dollars ($20,300) (the "Principal"), without interest. This Convertible Note (the "Note") is
issued in satisfaction of an invoice due to Wolf Greenfield and Sacks PC by Borrower (the "Invoice") and legally assigned
to Lender pursuant to the Assignment attached hereto as Exhibit A (the "Assignment"), which such Invoice Borrower and
Lender had agreed to settle in Shares on certain terms and conditions immediately following the Assignment and which this Note
memorializes the amended terms and conditions of.

 

		1.	Payment and Conversion.

 

		(a)	Payment. Borrower shall pay to Lender the Principal under this Note on or before the Maturity
Date affixed above. Borrower shall pay all amounts due under this Note in lawful money of the United States of America and without
set-off, deduction, demand or notice.

 

		(b)	Exchange of Loan Obligation. All or any portion of the then outstanding Principal ("Exchanged
Amount") may be exchanged for shares of Borrower's common stock ("Shares") at the election of either Lender
or Borrower at any time prior to the Maturity Date by giving written notice in the form attached as Annex A (a "Notice of
Conversion"), subject to the limitations set forth in Section 1(d) below (a "Conversion"). In return for the Exchanged
Amount so exchanged, Lender shall receive a number of Shares equal to the Exchanged Amount divided by the Exchange Price. The Exchange
Price shall be equal to the lesser of (x) 80% of the volume-weighted average closing price of the Borrower's common stock for the
twenty (20) trading days immediately prior to the date of the Notice of Conversion (the "Exchange Date") as reported
on the OTCBB, Pinksheets, or other market where the Shares are then quoted for trading provided that in the event no such quoted
market exists, the Exchange Price shall be determined according to an appraisal of fair market value conducted by a mutually-agreed
independent appraiser, and ratified by the disinterested members of the Borrower's board of directors or if there are no disinterested
members then the board acting unanimously; and (y) $0.14 (which shall be adjusted proportionately or as appropriate in the event
of any stock split, recapitalization, stock dividend or other similar transaction).

 

 

 

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An election made to exchange
amounts owed hereunder for Shares cannot be revoked without the written consent of the other party. The Borrower shall issue and
deliver to the Lender the Shares by DWAC within not more than one (1) business day of receiving notice from Lender. Should such
Notice of Conversion represent all of the remaining obligations due hereunder, Lender shall deliver to Borrower the original Note
marked "paid in full."

 

		(c)	Mandatory Conversion. Any unpaid Principal due hereunder upon the Maturity Date shall automatically
be exchanged for Shares upon the terms described in Section above using the Maturity Date as the Exchange Date, without requiring
the additional consent of either patty, provided that the restrictions described in Section 1(d) below are observed.

 

		(d)	Restrictions on Conversion.

 

		i)	4.99% Limitation. Under no circumstances may either Lender or Borrower effect a Conversion
if, after giving effect to such Conversion upon delivery of Shares, Borrower would beneficially own in excess of 4.99% of the Shares
of Lender outstanding immediately after giving effect to such conversion. For purposes of the foregoing sentence, the number of
Shares beneficially owned by the Lender and its Affiliates (as defined below) shall include the number of Shares issuable upon
the Conversion with respect to which the determination of such sentence is being made, but shall exclude the number of Shares which
would be issuable upon (A) conversion of the remaining, nonconverted portion of this Note beneficially owned by the Lender or any
of its Affiliates and (B) exercise or conversion of the unexercised or nonconverted portion of any other securities of the Borrower
(including, without limitation, any other Notes or the Warrants) subject to a limitation on conversion or exercise analogous to
the limitation contained herein beneficially owned by the Lender or any of its Affiliates. Except as set forth in the preceding
sentence, for purposes of this Section 1(d)(i), beneficial ownership shall be calculated in accordance with Section 13(d) of the
Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder and the rules and regulations
promulgated thereunder (the "Exchange Act"). To the extent that the limitation contained in this section applies, the
determination of whether this Note is convertible (in relation to other securities owned by the Lender) and of which a portion
of this Note is convertible shall be in the sole discretion of Lender. To ensure compliance with this restriction, Lender will
be deemed to represent to the Borrower each time it delivers a Notice of Conversion that such Notice of Conversion has not violated
the restrictions set forth in this paragraph and the Borrower shall have no obligation to verify or confirm the accuracy of such
determination. In addition, a determination as to any group status as contemplated above shall be determined in accordance with
Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. For purposes of this Section 1(d)(i), in
determining the number of outstanding Shares, the Lender may rely on the number of outstanding Shares as reflected in (x) the Borrower's
most recent quarterly or annual report on Form 10-QSB or Form 10-KSB or equivalent similar filing on such public disclosure service
as the Borrower may then be utilizing, as the case may be, (y) a more recent public announcement by the Borrower including on the
OTC Markets website, or (z) any other notice by the Borrower or the Borrower's Transfer Agent approved by the Borrower setting
forth the number of Shares outstanding. Upon the written or oral request of the Lender, the Borrower shall within two business
days confirm orally and in writing to the Lender the number of Shares then outstanding. In any case, the number of outstanding
Shares shall be determined after giving effect to the conversion or exercise of securities of the Borrower, including this Note,
by the Lender or its Affiliates since the date as of which such number of outstanding Shares was reported. The provisions of this
Section 1(d) may be waived by the Lender, at the election of the Lender, upon not less than 61 days' prior notice to the Borrower,
and the provisions of this Section 1(d)(i) shall continue to apply until such 61st day (or such later date, as determined by the
Lender, as may be specified in such notice of waiver). The provisions of this paragraph shall be implemented in a manner necessary
to preserve the intended 4.99% beneficial ownership limitation herein contained and shall not be modified in a manner otherwise
than in strict conformity with the terms of this Section 1(d)(i) to correct this paragraph (or any portion hereof) which may be
defective or inconsistent with the intended 4.99% beneficial ownership limitation herein contained or to make changes or supplements
necessary or desirable to properly give effect to such 4.99% limitation. The limitations contained in this paragraph shall apply
to a successor holder of this Note. "Affiliate" means any Person that, directly or indirectly through one or more intermediaries,
controls or is controlled by or is under common control with a Person, as such terms are used in and construed under Rule 144 under
the Securities Act of 1933, as amended.

 

 

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		ii	Conversion by Borrower. In
addition to the limitations imposed by Section 1(d)(i) above,
	 	 	Borrower may only exercise their right to effect a
                              Conversion of Principal by Lender if all of the following are true:

 

		a.	the Shares that Lender would receive are, upon receipt, freely-tradable and may be sold or transferred by Lender without restriction
on resale of any kind;

		b.	the Shares are listed or quoted for trading on the OTCBB, Pinksheets or an equivalent recognized exchange;

		c.	at the time of delivery of the Shares, the Borrower is in good standing as a publicly traded entity,
meeting all requirements for providing "adequate current information" or maintaining "fully-reporting" status
as those terms are used in the ordinary course of business, and is otherwise in good standing under applicable securities law,
exchange rules or similar rules or regulations, including, without limitation possessing no less than a "Pink Current"
sign if trading on the Pinksheets market; and

		d.	no Event of Default exists (as defined below).

 

		2.	Interest. This Note shall not bear interest.

 

		3.	Application of Payments. Payments will be applied first to any costs and expenses (including
reasonable attorneys' fees) incurred by Lender in connection with the collection of amounts owing pursuant to this Note, then to
interest accruing at the Default Rate, and then to reduction of Principal. All payments shall be made to Lender at the specified
address until receipt of notice from Lender to the contrary.

 

		4.	Default Rate. Upon the occurrence of an Event of Default, Lender shall be entitled to receive,
and Borrower shall pay to Lender, interest on the outstanding principal balance and any other advances or charges advanced by Lender
at a per annum rate equal to the lesser of (a) eighteen percent (18%), or (b) the maximum interest rate which Borrower may by law
pay (the "Default Rate"). The Default Rate shall be computed from the occurrence of the Event of Default until
the earlier of the date upon which the Event of Default is cured or the date upon which due and owing under this Note are paid
in full. The preceding sentence, however, shall not be construed as an agreement or privilege to extend the date of the any payment
due hereunder, or as a waiver of any other right or remedy accruing to Lender by reason of the occurrence of any Event of Default.

 

		5.	Prepayment. This Note may be prepaid by providing twenty business days' notice during which
time Lender may exercise their right to effect a Conversion.

 

		6.	Security Interest. This Note is unsecured.

 

 

 

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		7.	Default. Any one of the following occurrences shall constitute an "Event of Default"
under this Unsecured Revolving Credit Note provided that Lender shall be required to give written notice of same:

 

		(a)	The failure of Borrower to repay all outstanding Principal on or before the Maturity Date or timely
deliver Shares upon a Conversion;

 

		(b)	The failure of Borrower to promptly perform any obligation of Borrower under, a breach of, or the
existence of an Event of Default as defined in this Note, or any other note, debt or claim owed by Borrower to Lender; or

 

		(c)	Borrower becomes insolvent, bankrupt or generally fails to pay its debts as such debts become due;
is adjudicated insolvent or bankrupt; admits in writing its inability to pay its debts; or shall suffer a custodian, receiver or
trustee for it or substantially all of its property to be appointed and if appointed without its consent, not be discharged within
sixty (60) consecutive days; makes an assignment for the benefit of creditors; or suffers proceedings under any law related to
bankruptcy, insolvency, liquidation or the reorganization, readjustment or the release of debtors to be instituted against it and
if contested by it not dismissed or stayed within sixty (60) consecutive days; if proceedings under any law related to bankruptcy,
insolvency, liquidation, or the reorganization, readjustment or the release of debtors is instituted or commenced by or against
Borrower; if any order for relief is entered relating to any of the foregoing proceedings; if Borrower shall call a meeting of
its creditors with a view to arranging a composition or adjustment of its debts; or if Borrower shall by any act or failure to
act indicate its consent to, approval of or acquiescence in any of the foregoing.

 

		8.	Remedies. Upon the happening and during the continuation of any Event of Default, (i) Lender
may, at its sole option, declare the entire Principal immediately due and payable in full; (ii) interest shall accrue on all amounts
due hereunder at the Default Rate until paid in full or such Event of Default is cured; and (iii) Lender shall have and may exercise
any and all rights and remedies available hereunder, at law and in equity, together with any and all rights and remedies provided
in any related document including the Mutual Release and Settlement Agreement. The acceptance of any installment or payment after
the occurrence of an Event of Default or event giving rise to the right of acceleration provided for herein shall not constitute
a waiver of such right of acceleration with respect to such Event of Default or event or any subsequent Event of Default. The remedies
of Lender, as provided herein or in any related document, shall be cumulative and concurrent, and may be pursued singularly, successively
or together, at the sole discretion of Lender, and may be exercised as often as occasion therefore shall arise. Any act, omission
or commission of Lender, including, specifically, any failure to exercise any right, remedy or recourse, shall be released and
be effected only through a written document executed by Lender and then only to the extent specifically recited therein. A waiver
or release with reference to any one event shall not be construed as continuing, as a bar to, or as a waiver or release of, any
subsequent right, remedy or recourse as to a subsequent event.

 

		9.	Collection Costs. If one or more Events of Default (or any event which with notice or passage
of time or both would constitute an Event of Default) hereunder shall occur and continues, Borrower promises to pay all collection
costs, including but not limited to all reasonable attorneys' fees, court costs, and expenses of every kind, incurred by Lender
in connection with such collection or the protection or enforcement of any or all of the security for this Note, whether or not
any lawsuit is filed with respect thereto (including costs and reasonable attorneys' fees on any appeals or in any bankruptcy proceedings).

 

 

 

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		10.	Legal Opinions and Disclosures. Within the scope of applicable securities law and at its
cost and expense, Borrower shall cooperate to the fullest commercially reasonable extent in obtaining, or directing its legal counsel
to deliver, legal opinions or cooperate with Borrower's legal counsel pertaining to (x) the removal of restrictive legends from
Shares under Rule 144 or other applicable regulations, or (y) the deposit or new issuance of Shares by Lender to its brokerage
electronically, including such supplemental opinions as are requested by such brokerage, for any Shares issued as a result of Conversions.
All such opinions shall be delivered in not more than one (1) business day of request by Lender. In the event Lender is required
to obtain such legal opinions at its own expense, the actual and reasonable cost of same shall be added to the Principal balance
of this Note. While this Note is outstanding, Borrower shall use its commercially reasonable best efforts to meet all requirements
for providing "current information" or "fully-reporting" status as those terms are used in the securities industry,
and otherwise remain in good standing under applicable securities law, exchange rules or similar rules or regulations, and otherwise
ensure the continued tradability of its Shares.

 

		11.	Miscellaneous.

 

		(a)	Successors and Assigns. This Note inures to the benefit of Lender and its successors or
assigns, and binds Borrower, and its respective permitted successors and assigns, and the words "Lender" and "Borrower"
whenever occurring herein shall be deemed and construed to include such respective successors and assigns. Lender may assign all
or any portion of this Note without the consent of Borrower by providing written notice of such assignment.

 

		(b)	Severability. Any term or provision of this Note that is held by a court of competent jurisdiction
or other authority to be invalid, void or unenforceable in any situation or in any jurisdiction shall not affect the validity or
enforceability of the remaining terms and provisions or the validity or enforceability of the invalid, void or unenforceable term
or provision in any other situation or in any other jurisdiction. If the final judgment of a court of competent jurisdiction or
other authority declares that any term or provision of this Note is invalid, void or unenforceable, the parties agree that the
court making such determination shall have the power to and shall, subject to the discretion of such court, reduce the scope, duration,
area or applicability of the term or provision, to delete specific words or phrases, or to replace any invalid, void or unenforceable
term or provision with a term or provision that is valid and enforceable and that comes closest to expressing the intention of
the invalid or unenforceable term or provision.

 

		(c)	Waiver. To the fullest extent permitted by law, Borrower hereby waives all valuation and
appraisement privileges, presentment and demand for payment, protest, notice of protest and nonpayment, dishonor and notice of
dishonor, bringing of suit, lack of diligence or delays in collection or enforcement of this Note and notice of the intention to
accelerate, the release of any liable party, the release of any security for the indebtedness evidenced hereby, and any other indulgence
or forbearance, and is and shall be directly and primarily liable for the amount of all sums owing and to be owed hereon, and agrees
that this Note and any or all payments coming due hereunder may be extended or renewed from time to time without in any way affecting
or diminishing Borrower's liability hereunder.

 

		(d)	Notices. All notices required to be given to any of the parties hereunder shall be in writing
and shall be delivered (a) by personal delivery, with receipt acknowledged; (b) by telecopier or electronic mail (with original
copy to follow as set forth herein); (c) by reputable overnight commercial courier service; or (d) by United States registered
or certified mail, return receipt requested, postage prepaid, to the parties at the addresses as set forth below (subject to the
right of a party to designate a different address for itself by notice similarly given). Whenever the giving of notice is required,
the giving of such notice may be waived in writing by the party entitled to receive such notice.

 

 

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If to Borrower:

 

VG Life Sciences Inc.

2290 Huntington Drive, Suite 100

San Marino, CA 91108

Attn: Haig Keledjian

Fax: (626) 334-5324

Email: haig@vglifesciences.corn

 

If to Lender:

 

Michael Capizzano

c/o 2185 Warmlands Avenue

Vista, CA 92084

Fax: (416) 907-1429

Email: michaelcapizzano@gmail.com or mike@c-suiteadvisors.com

 

		(e)	Entire Agreement. This Note contains the entire agreement between the parties with respect to the subject matter hereof
and thereof.

 

		(f)	Modification of Agreement. This Note may not be modified, altered or amended, except by an agreement in writing signed
by both Borrower and Lender.

 

		(g)	Releases by Borrower. Borrower hereby releases Lender from all technical and procedural
errors, defects and imperfections whatsoever in enforcing the remedies available to Lender upon a default by Borrower hereunder.

 

		(h)	Remedies Not Exclusive. No remedy herein conferred upon or reserved to Lender is intended
to be exclusive of any other remedy or remedies available to Lender under this Unsecured Revolving Credit Note, at law, in equity
or by statute, and each and every such remedy shall be cumulative and in addition to every other remedy given hereunder or now
or hereafter existing at law, in equity or by statute.

 

		(i)	Governing Law. This Note shall be governed by and construed under the laws of the State
of California without giving effect to the choice of law provisions thereof.

 

		(j)	Consent to Jurisdiction. Borrower hereby consents that any action or proceeding against
it may be commenced and maintained in any Federal or state court sitting in Los Angeles County, California, and that such courts
shall have jurisdiction with respect to the subject matter hereof and the person of Borrower and the collateral securing Borrower's
obligations hereunder.

 

		(k)	Time of Essence. Time is of the essence of this Note and all of the obligations hereunder.

 

		(1)	Headings. The headings of the sections of this Note are inserted for convenience only and
do not constitute a part of this Note.

 

 

 

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		(m)	Waiver of Jury Trial. BORROWER AND LENDER, TO THE FULL EXTENT PERMITTED BY LAW, EACH HEREBY
KNOWINGLY, INTENTIONALLY AND VOLUNTARILY WAIVES, RELINQUISHES AND FOREVER FORGOES HEREBY THE RIGHT TO A TRIAL BY JURY IN ANY ACTION
OR PROCEEDING, INCLUDING, WITHOUT LIMITATION, ANY TORT ACTION, BROUGHT BY EITHER OF THEM AGAINST THE OTHER BASED UPON, ARISING
OUT OF, OR IN ANY WAY RELATING TO OR IN CONNECTION WITH THIS UNSECURED REVOLVING CREDIT Note, OR ANY COURSE OF CONDUCT, ACT, OMISSION,
COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PERSON (INCLUDING, WITHOUT LIMITATION, SUCH PERSON'S
DIRECTORS, OFFICERS, PARTNERS, MEMBERS, EMPLOYEES, AGENTS OR ATTORNEYS, OR ANY OTHER PERSONS AFFILIATED WITH SUCH PERSON), IN CONNECTION
WITH THIS Note , INCLUDING, WITHOUT LIMITATION, IN ANY COUNTERCLAIM WHICH BORROWER MAY BE PERMITTED TO ASSERT HEREUNDER OR WHICH
MAY BE ASSERTED BY LENDER OR ITS AGENTS AGAINST BORROWER, WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE. THIS WAIVER BY BORROWER
OF ITS RIGHT TO A JURY TRIAL IS A MATERIAL INDUCEMENT FOR LENDER UNDER THIS UNSECURED REVOLVING CREDIT Note.

 

		(n)	Note for Business or Commercial Purpose. BORROWER EXPRESSLY WARRANTS AND REPRESENTS TO LENDER
THAT THIS Note IS INTENDED FOR AND WILL BE USED FOR A BUSINESS OR COMMERCIAL PURPOSE AND THAT THIS Note IS NOT INTENDED FOR A CONSUMER,
PERSONAL, FAMILY OR HOUSEHOLD PURPOSE.

 

		(o)	Authority. Borrower (and the undersigned representative of Borrower, if any) represents
and warrants that it has full power and authority to execute and deliver this Note, and the execution and delivery of this Note
has been duly authorized and does not conflict with or constitute a default under any law, judicial order or other agreement affecting
Borrower.

 

		(p)	Assignment. Lender may assign, transfer, pledge or hypothecate any or all of this Note or
the Shares acquirable upon exchange without Borrower's consent.

 

IN WITNESS WHEREOF,
Borrower has executed and delivered this Note effective as of the date first above written.

 

BORROWER:

 

VG LIFE SCIENCES INC.

 

 

By: /s/ Haig Keledjian                          

Haig Keledjian, President and CEO

 

Dated: 7/12/2011

 

 

 

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ANNEX A

 

NOTICE OF CONVERSION

 

The undersigned hereby
elects to convert principal of the Note pursuant to Section 1(b) therein into shares of common stock, par value $0.0001 per share,
of VG Life Sciences Inc., a Delaware corporation ("Shares"), 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 the Lender of the Note, such person will pay all transfer
taxes payable with respect thereto and is delivering herewith such certificates and opinions as reasonably requested by the Borrower
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 Note to be Converted:

 

Number of shares of Common Stock to be issued:

 

 

 

Signature:

 

Name:

 

Address:

 

 

 

 

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EXHIBIT A

 

 

 

 

 

 

    	9Exhibit 10.108

 

 

DEBENTURE PURCHASE AGREEMENT

 

DEBENTURE PURCHASE AGREEMENT dated as of
February 15, 2013 (this "Agreement"), by and between TIMOTHY & THOMAS LLC (the "Seller"), and DMBM, INC.,
a New York corporation (the "Purchaser"). Each of the Seller and the Purchaser is also herein referred to as a "Party"
and collectively as the "Parties".

 

The Seller is the legal
and beneficial owner of a Convertible Debenture in the principal amount of U.S. $1,900,000.00 a true, current and complete copy
of which is attached hereto as Exhibit A, (the "Debenture") issued by VG Life Sciences Inc., formally known as Viral
Genetics Inc., a Delaware corporation ("VG"). The Seller desires to sell $450,000.00 of the principal amount of the Debenture
to the Purchaser and the Purchaser desires to purchase said $450,000 principal amount of the Debenture from Seller, upon the terms,
conditions and provisions set forth in this Agreement.

 

NOW, THEREFORE, in
consideration of these premises and other good and valuable consideration, the receipt and legal adequacy of which is hereby acknowledged
by the Parties, the Seller and the Purchaser hereby agree as follows:

 

1. Transfer of the
Debenture. (a) The Seller represents and warrants to the Purchaser and agrees for the benefit of the Purchaser that (i) the
Seller currently has, and, at the time of the Closing (as hereinafter defined), will have, good and marketable title to the Debenture;
and (ii) the Seller has not pledged, and as of the time of the Closing, shall not have pledged, the Debenture or granted any security
interest, charge or lien or other encumbrance in or to the Debenture (the "Liens").

 

(b) The Seller further
represents and warrants to the Purchaser and agrees for the benefit of the Purchaser that the current principal amount outstanding
and owing by VG under the Debenture is U.S. $900,000.

 

(c) The Seller further
represents and warrants to the Purchaser and agrees for the benefit of the Purchaser that upon the occurrence of the Closing, the
Purchaser will acquire all of the Seller's right, title and interest in and to said $450,000 principal amount of Debenture free
and clear of any and all Liens, including, without limitation, all of the Seller's right, title and interest in and to all claims,
actions and rights against Viral related to or arising out of said $450,000 principal amount of the Debenture.

 

2. Purchase Price.
The Seller agrees to sell said $450,000 principal amount of the Debenture to the Purchaser and the Purchaser agrees to Purchase
that portion of the Debenture from the Seller for the purchase price of U.S. $300,000.00 (the "Purchase Price") pursuant
to this Agreement.

 

 

 

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3. Payment
of Purchase Price. The Purchase Price will be paid as follows: (i) $25,000 will be wire transferred to the Seller's bank
account identified in writing by Seller prior to (or as set forth on Exhibit B attached hereto) on February 22, 2013 (the
"Initial Payment Date") and an additional $12,500 to be wire transferred on March 1, 2013, (ii) $37,500 to wired on
Apri1 1, 2013, May 1, 2013, June 1, 2013, and with $18,750 to be wired the first of the month for the successive months
thereafter, commencing on July 1, 2013 until the Purchase Price is paid in full. The payments of the Purchase Price shall be
made pursuant to a promissory note issued by the Purchaser, dated as of the Initial Payment Date, which is payable to the
order of the Seller in the principal amount of U.S. $300,000.00 and in the form of Exhibit C attached hereto (the
"Note").

 

4. The Closing.
(a) The Closing of the transaction contemplated hereby (the "Closing"), will take place by email upon completion of the
following deliverables no later than February 22, 2013:

 

Each of the Purchaser and the
Seller shall deliver to the other Party an executed counterpart of this Agreement;

 

The Purchaser shall deliver to
the seller an executed copy of the note;

 

The Purchaser shall deliver a
true and correct copy of the Debenture to the Seller; and

 

The payment by the Purchaser
of the initial $25,000 installment of the Purchase Price.

 

(b) If the Purchaser
does not pay the Seller the initial U.S. $25,000.00 installments of the Purchase Price on the Initial Payment Date as contemplated
hereby, the Closing shall be deemed not to have occurred this Agreement shall be deemed null and void ab initio, and the Purchaser
shall not have acquired any right, title or interest in or to the Debenture.

 

(c) Promptly after
the Closing, Purchaser and Seller shall request that VG divide the Debenture into two (2) debentures, and the initial payment under
the Note, each dated the original issue date, each in the principal amount of $450,000, and that VG deliver one such debenture
to each of the Purchaser and the Seller.

 

5.
Default by Purchaser. If the Event of Default (as that term is defined in the Note) under the Note shall occur, as opposed
to any acceleration of the payments of the Note by the Seller, as provided by the terms of the Note, the entire then unconverted
amount of the Debenture shall revert back to the Seller. Should an Event of Default occur, the Purchaser will immediately
return to the Seller the original version of the Debenture and upon receipt thereof, the Seller shall return the original version
of the Note to the Purchaser, whereupon neither the Purchaser nor the Seller shall have any liability to the other Party, except
as provided in Section 9 hereof. The Seller shall be entitled to retain all payments of the Purchase Price received by the Seller
despite any such reversion of the Debenture.

 

 

 

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6. Mutual Representations
and Warranties. Each of the Purchaser and the Seller hereby represents and warrants to the other that (a) it has the full legal
capacity, power, ability and authority (corporate or otherwise) to execute and deliver this Agreement and to perform its obligations
hereunder (and in the case of the Purchaser, also the execution, delivery and performance of the Note); (b) its execution, delivery
and performance of this Agreement (and in the case of the Purchaser, also the execution, delivery and performance of the Note)
has been duly authorized by it in accordance with all requisite corporate and other power and authority; as applicable, (c) this
Agreement (and in the case of the Purchaser, also the Note) 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 (and in the case of the Purchaser, also the Note) 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 (and in the case of the Purchaser, also the Note).

 

7. Expenses.
Each Party shall bear its own costs and expenses incurred in connection with its negotiation, execution and delivery of this Agreement
and the transactions contemplated hereby, including, without limitation, the fees and disbursements of its legal counsel.

 

8. Confidentiality.
Each of the Purchaser and the Seller agrees to keep the terms and provisions of this Agreement confidential and not to make any
disclosure thereof, except (i) with the prior written consent of the other Party hereto; (ii) for disclosure that is required by
applicable law, regulation, subpoena or other similar judicial process; (iii) in connection with the enforcement of this Agreement;
or (iv) to their respective directors, officers, employees, accountants and attorneys who need to know the terms and provisions
of this Agreement and who agree to keep the terms and provisions of this Agreement confidential in accordance with this Section
8.

 

 

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9. Indemnification.
Each of the Purchaser and the Seller shall indemnify and hold harmless the other Party, and the other Party's directors, officers,
shareholders, employees, agents, affiliates and the successors and assigns of each of the foregoing (each an "Indemnitee")
from and against any loss, liability, claim, damage, action, suit, penalty, cost or expense (including, without limitation, reasonable
attorneys' fees and expenses), incurred by any Indemnitee in connection with defending any claim action, suit or proceeding, or
any threat thereof (whether or not in writing), which is based on or arises out of (x) any breach by the indemnifying Party of
any of its representations and warranties made herein or (y) any breach or failure by the indemnifying Party to observe or perform
any of the covenants or agreements set forth in this Agreement.

 

10. Notices.
Any and all notices, consents, instructions and other communications which are required or permitted to be given hereunder or made
by one Party hereto to the other Party hereto pursuant to this Agreement shall be in writing and given as follows: (a) by personal
delivery; (b) by facsimile; or (c) by overnight delivery by an internationally recognized overnight express courier company at
the following respective addresses or facsimile numbers, set forth below:

 

	If to the Seller: 	Timothy & Thomas LLC	 
	 	 	 
	 	 	 
	 	 	 
	 	Attn:	 
	 	 	 
	 	 	 
	 	Fax No. 	 	 
	 	 	 
	 	 	 
	If to NAR:	DMBM, INC.	 
	 	200 East Broadway	 
	 	Port Jefferson, NY 11777	 
	 	Attn: Mr. Damon Robert Devitt	 
	 	President	 
	 	Fax No.: (631) 403-1189	 

 

or at such other address or facsimile number
as either party hereto may designate by notice to the other Party hereto in accordance with this Section 10. All such notices,
consents, demands, instructions and other communications shall be deemed given (a) on the business day delivered, if delivered,
personally, (b) on the business day of the facsimile transmission if received on a business day between the hours of 9:00 a.m.
and 5:00 p.m. (in the time zone of the intended recipient) or on the next business day if received after that time, in each case
with an automatic machine confirmation indicating the time of receipt; or (c) on the second business day after delivery to an internationally
recognized overnight express courier service with all costs paid.

 

 

 

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11. 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.

 

12. 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 of tills Agreement.

 

13. Further Assurances.
At the request of the Purchaser, the Seller will take all actions and execute all documents, certificates, powers, assignments
and other instruments as may be requested by the Purchaser to implement the sale, assignment and transfer of the Debentures and
the Other Transaction Documents to the Purchaser.

 

14. Governing Law;
Jurisdiction. 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.

 

 

 

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15. 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.

 

16. 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.

 

17. 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.

 

18. 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 Seller and the Purchaser has duly executed this Agreement as of the date first written above.

 

	 	Timothy & Thomas LLC	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	By: 	/s/	 
	 	 	Name:	 
	 	 	Title:	 

 

	 	DMBM,lNC.	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	By	/s/ Damon R. Devitt	 
	 	 	Name: Damon R Devitt	 
	 	 	Title: President	 

 

 

 

 

 

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EXHIBIT B

 

	Bank:	Urban Partnership Bank
	 	P.O. Box 19260
	 	Chicago, IL 60619-0260 
	 	(800) 905-7725
	 	 
	Account Name: 	Timothy & Thomas, LLC
	Account No.: 	7100005128
	ABA No.: 	071004226
	Telephone No.:	(773) 842-9982

 

 

 

    	8

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