Term Sheet for the Acquisition of Assets of Network Foundation Technologies, LLC by StationDigital Corporation January 19, 2015

NIFTY is a closely-held private California limited liability company which has designed, developed and patented a technology enabling practical streaming of live television over the Internet with:

·         14 Patents covering Systems and Methods for distributing Data and Content over a Computer Network;

·         A number of potential claims against major technology companies in connection with the violation of its patents;

·         Approximately 13.9 Million Units of Limited Partnership Interests Outstanding approximately 52% of which are owned by Dr. Michael O’Neal and Marcus Morton, 21%, by initial investors which contributed approximately $1.1 million in capital and 27% by the “Montauk Group” which contributed approximately $7.25 million in capital; and

·         Total liabilities of $1.1 Million as of November 3, 2014 consisting of Accounts Payable of approximately $105,000 and amounts due Shareholders of approximately $995,000.

StationDigital is a Delaware corporation with a digital media broadcast business:

• with an average of over 340,000 monthly active sessions per month since March of 2014;
• traded on the OTC QB;
• 82,341,826 shares of common stock issued and outstanding as of November 11, 2014;
• $2,187,500 15% Convertible Secured Note outstanding with $500,000 March 31, 2015 maturity date and the rest spread over the next 4 months, as of November 11, 2014;
• 3,675,000 warrants convertible at 45 cents

The Transaction will be effected through an Asset Purchase (“AP”), as detailed in an Asset Purchase Agreement (“APA”), (collectively, the Transaction”) pursuant to which:

• StationDigital will permit NIFTY to assign two of the five board seats.
• StationDigital, or subsidiary, will acquire all or substantially all of the assets, patents, patents pending including but not limited to the attached schedule of assets of NIFTY in exchange for such number of shares of Series B Convertible Preferred Stock (“Series B Preferred Stock”) convertible into 29% of the outstanding shares of StationDigital’s common stock as of the date of closing. To the extent the senior secured note of 2.4 million in debt is converted prior to the date of closing, the amount of outstanding shares of StationDigital’s common stock will be adjusted upwards. (Please see Table 1.) Otherwise, the amount of outstanding shares of StationDigital’s common stock will be calculated as of the date of closing.

Such Series B Preferred Stock Shall:

Carry a Conversion Price of $.45;

Vote on an “as converted basis;”

Rank pari - passu with the Common Stock in the event of disloution.

Be convertible at any time following the first anniversary of issuance: (i) at the option of the holder; and (ii) at the option of the Company, at such time when the 20 Day Volume Weighted Average Exercise Price (“VWAP”) exceeds 150% of the Conversion Price;

Carry weighted average anti-dilution protection for a period of 18 months, for additional issuances of Common Stock or Common Stock Equivalents for issuances below the Conversion Price. Such anti-dilution protection shall carry customary exclusions for items such as ESOP grants, dividends and grants pursuant to Celebrity Endorsements.

• For a period of 3 years after the Closing, StationDigital will pay pre-merger shareholders (as set forth on the capitalization table to be annexed as a schedule to the Definitive Agreement) ten percent (10%) of the net proceeds obtained from any patent litigation or patent licensing after deduction of all related legal fees, costs and expenses. These sums will be paid within 120 days after the end of the fiscal year.

The Transaction is subject to and conditioned on the following:

• each party’s completion and satisfaction with the result of its legal, financial and business due diligence investigations;
• approval of the transaction structure by each party’s tax advisors;
• approval by the board of directors of StationDigital and the members of NIFTY;
• negotiation and execution of Definitive Agreements;
• approval of the Definitive Agreements and the Transaction by any necessary governmental authorities, including, but not limited to the Federal Trade Commission and the Securities and Exchange Commission;
• The extension of $600,000 in face amount of Secured Convertible Notes to a maturity date of August 7^th 2015;
• A capital raise, with a minimum amount of $4.0 million (the “Minimum Offering”) and maximum amount of $6.0 million (the “Maximum Offering”), the proceeds of which shall be in escrow and close simultaneous with the closing of the Transaction (the “Offering”).

StationDigital will assume $600,000 of debt from the offering for existing liabilities of NIFTY and will issue additional stock of 2 million (2,000,000) shares of common stock for the remaining liabilities. NIFTY has the right to split up the shares as deem fit.

Until such time as the board of directors of StationDigital deems it appropriate to make a press release covering the Transaction, the parties will keep this Term Sheet and the provisions hereof confidential except that each may disclose the same to its financial advisors and attorneys as reasonably necessary for evaluation of the transaction and subject to confidentiality obligations equivalent to those in the Non-Disclosure Agreement by and between NIFTY and StationDigital.

Further, for a period of 90 days from the date hereof, NIFTY will not take any action to solicit, initiate, encourage, entertain, discuss, accept, consider or assist the submission of any proposal, negotiation or offer from any person or entity other than the Transaction contemplated hereby with StationDigital,

StationDigital Corporation

By: __/s/ Louis Rossi_________________

Louis Rossi

Chief Executive Officer

Network Foundation Technologies, LLC

By: __/s/ Marcus Morton________________

Marcus Morton

Co-Founder and President