Press Release
Source: Viral Genetics, Inc.

Form 8-K for VIRAL GENETICS INC /DE/.

Unregistered Sale of Equity Securities, Financial Statements and Exhibits.

AZUSA, Calif.--(BUSINESS WIRE) -- Sep 02, 2008 -- Viral Genetics, Inc. (Other OTC:VRAL - News)

Item 3.02 Unregistered Sales of Equity Securities
Viral Genetics entered into agreements with five holders of previously-issued convertible debentures in the principal amount of $676,898. The debentures were modified by extending the maturity dates by one year to September 1, 2009, and changing the conversion prices to $0.025 from $0.08. In conjunction, 4,326,737 warrants held by the investors will have their exercise price modified to $0.05 from $0.15. As part of the restructuring, the five participating investors also agreed to forego anti-dilutive price adjustments on their debentures in the event of private placement of restricted, unregistered shares by Viral Genetics at $0.02 or higher.

The debentures referenced above are part of a series originally sold in March 2006 in the principal amount of $2,891,549 that accrued interest at 10% per annum. Under the original terms of the agreement, the debentures were convertible at $0.45, and Viral Genetics was required to make monthly principal payments in cash or stock and quarterly interest payments, also in cash or stock. Subsequently, in March 2007, Viral Genetics entered into agreements with six holders of debentures totaling $1,968,811, whereby portions of the debentures were converted into shares, and the conversion price on the remaining balances was modified to $0.08 from $0.45. In addition, warrants held by these investors had their exercise price modified to $0.15 from $0.78. Following this 2007 restructuring, Viral Genetics was not required to make further monthly payments of principal and interest on this group of debentures.

The holders of debentures totaling $465,956 in principal did not participate in the March 2007 or the current restructuring, and these notes are due September 1, 2008.

All securities issued or deemed issued by Viral Genetics in the foregoing transactions were issued in reliance on the exemption from registration set forth in Section 3(a)(9) of the Securities Act of 1933.

Item 9.01 Financial Statements and Exhibits

Exhibits
Attached to this report as Exhibit 10.1 is the form of Agreement dated August 7, 2008, entered into with each investor participating in the restructuring.

About Viral Genetics

Viral Genetics, Inc. is a biotechnology company that discovers and develops immune-based therapies for HIV and AIDS using its thymus nuclear protein compound (TNP). The company recently entered into an Exclusive License Agreement with the University of Colorado and V-Clip Pharmaceuticals (a subsidiary of the Company) to license technology developed by M. Karen Newell, PhD that appears to explain TNP and provide a means to optimize therapies based on TNP for future clinical trials. TNP may have other potential applications for other infectious, autoimmune, and immunological deficiency diseases that the company intends to study in the future. Viral Genetics believes that its investigational HIV/AIDS drug based on TNP, called VGV-1, represents a unique approach to treating HIV due to the apparently novel mechanism, low toxicity profile, simple dosing regimen, and short-course of treatment. As a type of immune-based therapy, it focuses on boosting the immune system to allow the body to fight HIV more efficiently. VGV-1 has been studied in five human clinical trials for the treatment of HIV/AIDS. Online at www.viralgenetics.com.

This news release contains forward-looking statements that involve risks and uncertainties associated with financial projections, budgets, milestone timelines, clinical development, regulatory approvals, and other risks described by Viral Genetics, Inc. from time to time in its periodic reports filed with the SEC. VGV-1 is not approved by the US Food and Drug Administration or by any comparable regulatory agencies elsewhere in the world. While Viral Genetics believes that the forward-looking statements and underlying assumptions contained therein are reasonable, any of the assumptions could be inaccurate, including, but not limited to, the ability of Viral Genetics to establish the efficacy of VGV-1 in the treatment of any disease or health condition, the development of studies and strategies leading to commercialization of VGV-1 in the United States, the obtaining of funding required to carry out the development plan, the completion of studies and tests on time or at all, and the successful outcome of such studies or tests. Therefore, there can be no assurance that the forward-looking statements included in this release will prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein, the forward-looking statements should not be regarded as a representation by Viral Genetics or any other person that the objectives and plans of Viral Genetics will be achieved.

Contact:
For additional information, please contact:
Viral Genetics
Haig Keledjian, CEO, 626-334-5310

Source: Viral Genetics, Inc.

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