THIS PROMISSORY NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED. NO SALE OR DISPOSITION MAY BE EFFECTED EXCEPT IN COMPLIANCE WITH
RULE 144 UNDER SAID ACT OR AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO
OR AN OPINION OF COUNSEL FOR THE HOLDER SATISFACTORY TO THE COMPANY THAT SUCH
REGISTRATION IS NOT REQUIRED UNDER THE ACT OR RECEIPT OF A NO-ACTION LETTER FROM
THE SECURITIES AND EXCHANGE COMMISSION.

 

SECURED PROMISSORY NOTE AND AGREEMENT

 

$65,000 January 20, 2016   Los Angeles, CA

 

For value received, Blow & Drive Interlock Corporation, a Delaware corporation
(the “Company”), promises to pay Edris Consulting Inc., a California
Corporation, (the “Holder”) the principal sum of Sixty Five Thousand Dollars
($65,000). In the event that Edris Consulting, Inc., is dissolved, all payments
shall be made directly to Ira Silver, an individual, unless Edris Consulting
Inc., made contrary directives in writing. The principal hereof and any unpaid
accrued interest thereon shall be due and payable on or before 5:00 p.m.,
Pacific Time, on August 20, 2018 (the “Maturity Date”) (unless such payment date
is accelerated as provided in Section 5 hereof). Payment of all amounts due
hereunder shall be made at the address of the Holder provided for in Section 7
hereof.

 

1. HISTORY OF THE NOTE. This Note is being delivered to Holder in connection
with the Holder loaning the Company Sixty Five Thousand Dollars ($65,000).

 

2. PAYMENT SCHEDULE. The principal and interest due under this Note will be due
and payable by the Company to the Holder on the following schedule:

 

  a. $937.50 per month for four (4) months starting February 20, 2016;        
b. $1,250 per month for month five (5) and accelerating by $312.50 per month
through month twelve (12);         c. $3531.46 per month for months thirteen
(13) through twenty-four (24);         d. Starting in the twenty-fifth (25th)
month, the Company will pay the “Holder” Five Dollars ($5) per month for every
BDI-747 Ignition Interlock Device, or any other device and/or model number,
manufactured, distributed, developed or used by Blow & Drive Interlock
Corporation, (each a “Unit”) that the Company has on the road in customers’
vehicles up to Eight Hundred (800) Units in perpetuity; whether the device is
distributed, installed or used by Blow & Drive Interlock Corporation or one of
their affiliates, related companies, distributors and/or franchisees; and      
  e. For every Unit the Company has on the road in customers’ vehicles over 800
Units, then the Company will pay the Holder One Dollar ($1) per month for those
Units over 800 Units in perpetuity; Whether the device was distributed,
installed or used by Blow & Drive Interlock Corporation or one of their
affiliates, related companies, distributors and/or franchisees.

 

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All payments the Company makes to the Holder under (a) – (e) will count as
payments to Holder for the principal and interest due under this Note. In the
event the Company has more than Eight Hundred (800) Units on the road in
customers’ vehicles prior to the twenty-fifth (25th) month, then the Company
will beginning paying the amounts due under (d) and (e), above, at that time.
The payments payable by the Company under (d) and (e) will continue in
perpetuity even after all amounts due under this Note have been paid in full.

 

3. PREPAYMENT. The Company may at any time prepay all or any part of the
principal balance of this Note, provided that concurrently with each such
prepayment the Company shall pay accrued interest on the principal, if any,
prepaid to the date of such prepayment.

 

4. SECURITY. This Note is secured by up to 100,000 Units (as defined herein). In
the event there is an occasion whereby the Holder is entitled to foreclose on
the security listed herein, which would only be in the case of an Event of
Default as defined herein, the Holder will make such foreclosure demand to the
Company in writing, and upon receipt of such notice, the Company will
immediately transfer its rights in up to 100,000 Units to the Holder to satisfy
any principal amounts still due under this Note at the time of the Event of
Default. The number of Units to be transferred to the Holder under this Section
in the event of a foreclosure will be determined based on the amount of
principal and interest due under this Note at the time of the Event of Default
with each Unit being valued at $250. If such foreclosure occurs the Holder will
be deemed to be the owner of the Units only until the Company is no longer in
Default under this Note. At time the Units, and all rights appurtenant thereto,
will be returned to the Company.

 

5. DEFAULT. The occurrence of any one of the following events shall constitute
an Event of Default:

 

(a) The non-payment, when due, of any principal or interest pursuant to this
Note; or a payment pursuant to this agreement under 2. (d) and (e) above.

 

(b) The material breach of any representation or warranty in this Note. In the
event the Holder becomes aware of a breach of this Section 5(b), then provided
such breach is capable of being cured by Company, the Holder shall notify the
Company in writing of such breach and the Company shall have thirty (30)
business days after notice to cure such breach;

 

(c) The breach of any covenant or undertaking, not otherwise provided for in
this Section 5;

 

(d) The commencement by the Company of any voluntary proceeding under any
bankruptcy, reorganization, arrangement, insolvency, readjustment of debt,
receivership, dissolution, or liquidation law or statute of any jurisdiction,
whether now or hereafter in effect; or the adjudication of the Company as
insolvent or bankrupt by a decree of a court of competent jurisdiction; or the
petition or application by the Company for, acquiescence in, or consent by the
Company to, the appointment of any receiver or trustee for the Company or for
all or a substantial part of the property of the Company; or the assignment by
the Company for the benefit of creditors; or the written admission of the
Company of its inability to pay its debts as they mature; or

 

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(e) The commencement against the Company of any proceeding relating to the
Company under any bankruptcy, reorganization, arrangement, insolvency,
adjustment of debt, receivership, dissolution or liquidation law or statute of
any jurisdiction, whether now or hereafter in effect, provided, however, that
the commencement of such a proceeding shall not constitute an Event of Default
unless the Company consents to the same or admits in writing the material
allegations of same, or said proceeding shall remain undismissed for 20 days; or
the issuance of any order, judgment or decree for the appointment of a receiver
or trustee for the Company or for all or a substantial part of the property of
the Company, which order, judgment or decree remains undismissed for 20 days; or
a warrant of attachment, execution, or similar process shall be issued against
any substantial part of the property of the Company.

 

Upon the occurrence of any Default or Event of Default, the Holder, may, by
written notice to the Company, declare all or any portion of the unpaid
principal amount due to Holder, together with all accrued interest thereon,
immediately due and payable, in which event it shall immediately be and become
due and payable, provided that upon the occurrence of an Event of Default as set
forth in paragraph (d) or paragraph (e) hereof, all or any portion of the unpaid
principal amount due to Holder, together with all accrued interest thereon,
shall immediately become due and payable without any such notice.

 

6. TRANSFERABILITY. This Note shall not be transferred, pledged, hypothecated,
or assigned by the Holder without the express written consent of the Company,
which consent will not be unreasonably withheld.

 

7. NOTICES. All notices required or permitted hereunder shall be in writing and
shall be deemed effectively given: (a) upon personal delivery to the Party to be
notified, (b) when sent by confirmed facsimile if sent during normal business
hours of the recipient, if not, then on the next business day, or (c) one (1)
day after deposit with a nationally recognized overnight courier, specifying
next day delivery, with written verification of receipt. All communications
shall be sent as follows:

 

  If to the Company: Blow & Drive Interlock Corporation     1080 La Cienega
Boulevard     Suite 304     Los Angeles, California 90035     Attn. Laurence
Wainer     Facsimile (___)

 

  with a copy to: Law Offices of Craig V. Butler     300 Spectrum Center Dr.,
Suite 300     Irvine, CA 92618     Attn: Craig V. Butler, Esq.     Facsimile
No.: (949) 209-2545

 

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  If to Holder:                         Facsimile No.:    

 

or at such other address as the Company or Holder may designate by ten (10) days
advance written notice to the other Party hereto.

 

8. GOVERNING LAW; VENUE. The terms of this Note shall be construed in accordance
with the laws of the State of California, as applied to contracts entered into
by California residents within the State of California, and to be performed
entirely within the State of California. The parties agree that any action
brought to enforce the terms of this Note will be brought in the appropriate
federal or state court having jurisdiction over Los Angeles County, California.

 

9. CONFORMITY WITH LAW. It is the intention of the Company and of the Holder to
conform strictly to applicable usury and similar laws. Accordingly,
notwithstanding anything to the contrary in this Note, it is agreed that the
aggregate of all charges which constitute interest under applicable usury and
similar laws that are contracted for, chargeable or receivable under or in
respect of this Note, shall under no circumstances exceed the maximum amount of
interest permitted by such laws, and any excess, whether occasioned by
acceleration or maturity of this Note or otherwise, shall be canceled
automatically, and if theretofore paid, shall be either refunded to the Company
or credited on the principal amount of this Note.

 

10. Modification; Waiver. No modification or waiver of any provision of this
Note or consent to departure therefrom shall be effective unless in writing and
approved by the Company and the Holder.

 

11. ATTORNEY FEE. In the event of litigation, the prevailing party shall be
entitled to all attorney fees and costs.

 

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In witness whereof, Company has executed this Secured Promissory Note as of the
date first written above.

 

  “Company”       Blow & Drive Interlock Corporation,   a Delaware corporation  
          By: Laurence Wainer   Its: Chief Executive Officer

 

Acknowledged:       “Holder”       Edris Consulting Inc.           Signed by:
President, Ira Silver  

 

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