PROMISSORY NOTE

US$50,000.00
June 28, 2011                       

 
FOR VALUE RECEIVED, the undersigned, Innolog Holdings Corporation and Innovative
Logistics Techniques, Inc., (together the “Maker”), jointly and severally
promise to pay to the Kay M. Gumbinner Trust (the “Holder”), at such place as
the Holder may later designate in writing, in lawful money of the United States,
the principal sum of FIFTY THOUSAND US DOLLARS ($50,000.00) in accordance with
this promissory note (the “Note”) under the terms set forth herein. All of the
obligations directly or indirectly due to Holder hereunder and in connection
with the transactions contemplated hereby, including without limitation
principal, interest, fees, past due fees, purchase prices, costs and expenses,
are collectively referred to as the “Obligations.”
 
1.           Interest/Fee/Past Amount Owed
 
This Note shall bear interest at the rate of two percent (2%) per annum until
paid.
 
Maker shall pay to Holder a $1,000 transaction fee in connection with the costs
and expenses of negotiating and initially documenting this transaction; which
amount shall be paid out of the initial loan proceeds under this Note.
 
2.           Repayment & Purchase
 
Principal and interest due under this Note and the Purchase Price shall be
payable by 3:00 PM EDST on the maturity date of Friday, July 26, 2011 (“Maturity
Date”).  Furthermore, this Note shall be repaid as a first priority from any and
all amounts received by Maker from ANY accounts receivable received by any of
Maker subject only to normal operating expenses and regular current operating
accounts payables until this Note is repaid in full.  No payments are to be made
to any other notes or government agencies prior to the repayment of this Note.
 
Maker shall have the right to prepay at any time and from time to time, in
advance of maturity, all or part of the principal amount of this Note, along
with the above interest and fee.  Each payment shall be applied first to the
principal balance due.
 
TIME IS OF THE ESSENCE on the repayment of this Note.
 
3.           Late Fee and Default Interest
 
As noted above, time is of the essence on the repayment of this Note. If this
Note is not paid in full on or before the Maturity Date, there shall be a late
fee of ten percent (10%) or $5,000. There shall accrue additional Late Fees of
10% every ten (10) calendar days until repaid in full. In addition, after the
Maturity Date, this Note shall accrue interest from the Maturity Date at the
rate of eighteen percent (18%) per annum, compounded daily until paid in full
(“Default Interest”). Such Default Interest shall be on the outstanding
principal amount, the interest due under the Note and the Late Fee(s).
 
 
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4.           Events of Default
 
The following shall constitute Events of Default hereunder:
 
(a)           If Maker or Guarantor defaults in the payment of any amount due on
this Note when due (there is no requirement for any notice and there is no right
to cure any failure of payment when due); and
 
(b)           If Maker uses any accounts receivables or other moneys that come
into the company other than for payment of normal operating expenses and regular
current accounts payables before all amounts due under this Note are repaid in
full; and
 
(c)  If Maker or Guarantor shall (i) make a general assignment for the benefit
of creditors, or (ii) apply for or consent to the appointment of a receiver,
trustee or liquidator for itself or all or a substantial part of its assets, or
(iii) be adjudicated a bankrupt or insolvent, or (iv) file a voluntary petition
in bankruptcy or file a petition or an answer seeking reorganization or an
arrangement with creditors or seeking to take advantage of any other law
(whether Federal or state) relating to relief of debtors, or admit (by answer,
by default or otherwise) the material allegations of a petition filed against it
in any bankruptcy, reorganization, insolvency or other proceeding (whether
Federal or state) relating to relief of debtors, or (v) suffer or permit to
continue unstayed and in effect for sixty (60) consecutive days any judgment,
decree or order entered by a court of competent jurisdiction, that approves an
involuntary petition seeking reorganization of Maker, or appoints, pursuant to
such a petition, a receiver, trustee or liquidator for it or all or a
substantial part of its assets.
 
(d)           If Maker or Guarantor shall default in any other obligation to
Holder or any of its affiliates or relatives under any other agreement or
obligation.
 
5.           Remedies
 
(a)           Upon the happening of an Event of Default, Holder may, in Holder's
sole and absolute discretion and without notice or demand to Maker or to
Guarantor, accelerate the due date of any amounts owed hereunder and declare the
entire amount of principal and interest thereon remaining outstanding hereunder
immediately due and payable, whereupon, the same shall forthwith become and be
due and payable without any presentment, demand or notice of any kind, all of
which are expressly waived by Maker and Guarantor.
 
(b)           If an Event of Default shall occur, the Maker and Guarantor shall
jointly and severally pay the Holder, on demand by the Holder, all costs and
expenses incurred by the Holder in connection with the collection and
enforcement of this Note, including attorneys' fees, accountants and tax
advisor’s fees and the amounts described above.
 
6.           Security
 
This Note and the Obligations are guaranteed pursuant to a separate Guaranty and
Indemnity Agreement with Guarantor.  The full and prompt payment and the
performance of this Note are unconditionally and irrevocably guaranteed by Dr.
Ian Reynolds, an individual (“Guarantor”). I n addition to the Guarantee
contained herein, all of the Obligations are secured by the accounts receivable
of Maker; provided, however that the holder may not file any instruments
perfecting such security interest until after the Maturity Date.  After the
Maturity Date, Maker shall immediately upon request by the Holder execute and
deliver such security interests, UCC-I and other filing statements or other
documents or interests requested by Holder in order to perfect such security
interest.
 
 
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7.           Priority of Repayment.
 
This Note shall be repaid by Maker prior to the repayment of any other debt of
Maker other than (i) normal operating expenses, (ii) regular current accounts
payables and (iii) any secured obligations.
 
8.           Miscellaneous
 
(a)           This Note shall be deemed to be made and entered into under the
laws of the Commonwealth of Virginia and for all purposes shall be construed and
enforced in accordance with the laws of the Commonwealth of Virginia, without
giving effect to any of the conflicts of law principles which would result in
the application of the substantive law of another jurisdiction. Maker and
Guarantor (i) hereby irrevocably submit to the exclusive jurisdiction of the
United States District Court sitting in the Northern District of Virginia and
the courts of the Commonwealth of Virginia located in Fairfax County for the
purposes of any suit, action or proceeding arising out of or relating to this
Note and (ii) hereby waive, and agree not to assert in any such suit, action or
proceeding, any claim that it is not personally subject to the jurisdiction of
such court, that the suit, action or proceeding is brought in an inconvenient
forum or that the venue of the suit, action or proceeding is improper.
 
(b)           This Note shall be binding upon Maker and Maker's successors and
assigns and shall inure to the benefit of Holder and Holder's successors and
assigns; and each reference herein to Maker or to Holder shall, except where the
context shall otherwise require, be deemed to include its respective successors
and assigns.  This Note shall be binding upon Guarantor and Guarantor's heirs,
successors and assigns and shall inure to the benefit of Holder and Holder's
successors and assigns; and each reference herein to Guarantor, except where the
context shall otherwise require, be deemed to include its heirs, successors and
assigns.  Notwithstanding the foregoing, neither Maker nor Guarantor shall have
any right to assign his obligations hereunder without Holder's prior written
consent.
 
(c)           Any failure by Holder to exercise any right or remedy hereunder
shall not constitute a waiver of the right to exercise the same or any other
right or remedy at any subsequent time, and no single or partial exercise of any
right or remedy shall preclude other or further exercise of the same or any
other right or remedy.
 
(d)           Maker and Guarantor, and all others that may become liable for all
or any part of the obligations evidenced by this Note, hereby waive presentment,
demand, notice of nonpayment, protest and all other demands’ and notices in
connection with the delivery, acceptance, performance and enforcement of this
Note, and do hereby consent to any number of renewals of extensions of the time
or payment hereof and agree that any such renewals or extensions may be made
without notice to any such persons and without affecting their liability herein
and do further consent to the release of any person liable hereon, all without
affecting the liability of the other persons, firms or Maker or Guarantor liable
for the payment of this Note, AND DO HEREBY WAIVE TRIAL BY JURY.
 
(i)  No delay or omission on the part of the Holder in exercising its rights
under this Note, or course of conduct relating hereto, shall operate as a waiver
of such rights or any other right of the Holder, nor shall any waiver by the
Holder of any such right or rights on any one occasion be deemed a waiver of the
same right or rights on any future occasion.
 
 
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(ii)  THE MAKER AND GUARANTOR ACKNOWLEDGE THAT THE TRANSACTION OF WHICH THIS
NOTE IS A PART IS A COMMERCIAL TRANSACTION, AND TO THE EXTENT ALLOWED BY
APPLICABLE LAW, HEREBY WAIVE ITS RESPECIVE RIGHT TO NOTICE AND HEARING WITH
RESPECT TO ANY PREJUDGMENT REMEDY WHICH THE HOLDER OR ITS SUCCESSORS OR ASSIGNS
MAY DESIRE TO USE.
 
(e)           The remedies provided in this Note shall be cumulative and in
addition to all other remedies available under this Note, at law or in equity
(including, without limitation, a decree of specific performance and/or other
injunctive relief), no remedy contained herein shall be deemed a waiver of
compliance with the provisions giving rise to such remedy and nothing herein
shall limit a Holder’s right to pursue actual damages for any failure by the
Maker or Guarantor to comply with the terms of this Note.  Amounts set forth or
provided for herein with respect to payments, the warrants and the like (and the
computation thereof) shall be the amounts to be received by the Holder thereof
and shall not, except as expressly provided herein, be subject to any other
obligation of the Maker or Guarantor (or the performance thereof).  The Maker
and the Guarantor acknowledge-edge that a breach by it of its obligations
hereunder will cause irreparable and material harm to the Holder and that the
remedy at law for any such breach may be inadequate. Therefore the Maker and
Guarantor each agree that, in the event of any such breach or threatened breach,
the Holder shall be entitled, in addition to all other available rights and
remedies, at law or in equity, to seek and obtain such equitable relief,
including but not limited to an injunction restraining any such breach or
threatened breach, without the necessity of showing economic loss and without
any bond or other security being required.
 
(f)            Maker and Guarantor shall pay all costs and expenses associated
with this Note, the loan and the transactions contemplated hereby and hereunder.
 
(g)           Maker and Guarantor agree to pay immediately upon request and
without any need of any approvals or determinations of any kind all costs and
expenses of enforcement of this Note, including, without limitation, attorneys’
fees and expenses.
 
(h)           Maker and Guarantor shall immediately execute and deliver such
other documents, agreements and instruments as requested by Holder to carry out
the intent of this Note and related documents and to protect Holder’s interests
in any collateral or otherwise.
 
(i)            None of the terms and provisions hereof may be waived, altered,
modified, or amended except by an agreement in writing signed by Maker and
Holder.
 
CONFESSED JUDGMENT

THIS INSTRUMENT CONTAINS A CONFESSION OF JUDGMENT PROVISION WHICH CONSTITUTES A
WAIVER OF IMPORTANT RIGHTS YOU MAY HAVE AS A DEBTOR OR GUARANTOR AND ALLOWS THE
HOLDER TO OBTAIN A JUDGMENT AGAINST YOU WITHOUT ANY FURTHER NOTICE.

Maker, Innolog Holdings Corporation and Innovative Logistics Techniques, Inc.,
and Guarantor, jointly and severally (all three collectively hereinafter
referred to as “Debtor”), promise to pay to the order of Holder the sum of
SEVENTY-FIVE THOUSAND DOLLARS AND ZERO CENTS ($75,000.00), plus any additional
Late Fee(s), plus interest at 18% per annum, compounded daily, from the Maturity
Date until paid, including and after the recording of this confession of
judgment, plus all costs of collection, including all attorneys’ fees, and
accounting fees less credit for any payments made.
 
 
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Debtor hereby appoints the following persons, or any one of them, as the
undersigned’s attorney-in-fact for the purpose of confessing judgment in favor
of KAY M. GUMBINNER TRUST and Robert Gumbinner and Fred Gumbinner, trustees
under a trust agreement dated January 9, 2008 (known as the Kay M. Gumbinner
Trust), to wit:

Richard A. Golden, of 10627 Jones Street, #101B, Fairfax, Virginia 22030
Randall Borden, of 10627 Jones Street, #201A, Fairfax, Virginia 22030.

The undersigned’s said attorneys in fact are explicitly authorized, whether a
suit, motion or action be pending for the indebtedness or not, to confess
judgment in favor of the KAY M. GUMBINNER TRUST and Robert Gumbinner and Fred
Gumbinner, trustees under a trust agreement dated January 9, 2008 (known as the
Kay M. Gumbinner Trust), in the amount of $75,000.00, plus all costs and
expenses of collection (including attorneys’ fees), plus additional late fees,
plus interest from the date of judgment so confessed at the rate of 18% per
annum, compounded monthly, or such lesser amount of principal plus interest as
the creditor may be willing to accept.

Such confession of judgment may be made in the clerk’s office of the circuit
court in the Commonwealth of Virginia, located at Fairfax, Virginia.
 
Furthermore, Maker and Guarantor, jointly and severally acknowledge the Holders
right to pursue the guarantee, the security and the accounts receivable securing
this debt and the Confessed Judgment.  Debtor hereby expressly waives the
benefit of any homestead exemption as to this debt and waives demand, protest,
notice of presentment, notice of protest, and notice of non-payment and dishonor
of this note.  Debtor agrees this confessed judgment note is provided not in
payment of, but as additional security for and evidence of obligations due to
the Holder under the Note.
 
 
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IN WITNESS WHEREOF, the undersigned represents that he is duly authorized and
empowered to enter into this agreement and Maker has caused this Note to be
executed as of the day and year first above written by its duly authorized and
empowered officer or representative.

   
MAKER
         
Innolog Holdings Corporation
   
Innovative Logistics Techniques, Inc.
         
By:
       
William P. Danielczyk
     
Executive Chairman, Chairman
     
& Authorized Representative
     
For each of the respective entities
     
WITNESSED
                     
Name: ___________________
   

 
 
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