SECURED PROMISSORY NOTE


 


	US$25,000	February 22, 2012


 


FOR VALUE RECEIVED, the undersigned, Innolog
Holdings Corporation, a Nevada Corporation, and Innovative Logistics Techniques, Inc., a Virginia corporation (“Innolog”),
with principal executive offices are located at 4000 Legato Road, Suite 830, Fairfax, Virginia 22033, telephone number is (703)
766-1412, fax number is (703) 766-1425 and five additional offices located in Washington D.C., Tennessee and Florida (together,
the “Maker”), promises to pay to Erich Winkler, (the “Payee”), at such place as the Payee may later designate
in writing, in lawful money of the United States, the principal sum of TWENTY-FIVE THOUSAND United States dollars ($25,000) (the
“Principal Amount” as further defined herein) in accordance with this secured promissory note (the “Note”)
under the terms set forth herein. This Note is being made in conjunction with one or more other substantially similar notes of
even date herewith (collectively the “BoD AR Notes”)


 


1.    Principal
Amount:


 


The Principal Amount is TWENTY-FIVE THOUSAND
thousand dollars ($25,000) ((“Principal Amount”). This note shall be repaid pari passu with each of the other BoD AR
Notes.


 


2.    Maturity
Date/Pre-payment: 


 


The maturity date (“Maturity Date”)
is forty-five (45) days from the receipt of the Principal Amount. The Maker shall have the right to prepay at any time and from
time to time, in advance of the respective Maturity Date, without premium or penalty (but the entire Fee shall be due and payable),
all or part of the then outstanding Principal Amount and other amounts due and owing. Each payment shall be applied first to the
principal balance due. The Maturity Date may be extended with the approval of all parties.


 


3.    Rate
of Interest/Fee:


 


Maker shall pay to Payee a flat fee (“Fee”)
of ten percent of the Principal Amount, due and payable on the Maturity Date, which Fee shall be deemed earned at the time of the
initial funding of the loan.


 


4.    Additional
Compensation:


 


Maker shall issue to Payee or Payee’s
designee Warrants in a number equal to the Principal Amount, convertible into common stock of Innolog Holdings Corporation, a Nevada
corporation, at an exercise price of $0.06 per share for five years from the date hereof, with such other terms that are substantially
the same as other similar warrants.


 


5.    Late
Fee:


 


If this Note is not paid in full within
three (3) business days of the Maturity Date, a late fee (“Late Fee”) of ten percent (10%) of the amount outstanding
hereunder shall be due and owing, in which case, Maker shall have an additional thirty (30) days in which to pay the total amount
owed (Principal Amount, Fee, Late Fee and any collection costs).


 



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6.    Security
Interest/Subordination/Guaranty


 


Maker shall grant to Payee and the holders
of the other BoD AR Notes a joint and several security interest in the specific accounts receivable of Maker or Innolog as listed
below:


 


Naval Research Laboratories, Prime Contract No. N00173-11-F-0438,
Contract No. 5073-007, Electric Warfare Sys (INTOP), as billed on or about November 3, 2011, as may be more fully described in
an Attachment A if so attached.


 


and the proceeds therefrom (the “Collateral”). Maker
shall execute and promptly deliver such documents and instruments as Payee may request from time to time to secure, evidence and
perfect Payee's security interest and relative priority in the Collateral.


 


Payee is an officer, director or insider of Maker and acknowledges
that as such the repayment of this Note may be subordinate to the repayment or payment to other creditors of Maker.


 


This Note is also being guaranteed by Dr. Ian Reynolds pursuant
to a separate Guaranty Agreement of even date herewith.


 


7.     Events of Default


 


The following shall constitute Events of Default hereunder:


 


(a)          If
Maker defaults in the payment of any amount due on this Note when due; and


 


(b)          If
Maker 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.


 


8.     Remedies


 


(a)          Upon
the happening of an Event of Default, Payee may, in Payee's sole and absolute discretion and without notice or demand to Maker,
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.


 


(b)          If
an Event of Default shall occur, the Maker shall pay the Payee, on demand by the Payee, all reasonable costs and expenses incurred
by the Payee in connection with the collection and enforcement of this Note, including attorneys fees.


 


(c)          Upon
an event of default, all amounts outstanding shall bear interest at the default interest rate of eighteen percent 18% per annum
until paid in full, which shall be in addition to any Late Fees owed.


 



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9.     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, but not with respect to the law of conflicts.


 


(b)          This
Note shall be binding upon Maker and Maker's successors and assigns and shall inure to the benefit of Payee and Payee's successors
and assigns; and each reference herein to Maker or to Payee shall, except where the context shall otherwise require, be deemed
to include its respective successors and assigns. Notwithstanding the foregoing, Maker shall not have any right to assign his obligations
hereunder without Payee's prior written consent and Payee may not assign its interests hereunder without Maker’s prior written
consent.


 


(c)          Any
failure by Payee 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)          None
of the terms and provisions hereof may be waived, altered, modified, or amended except by an agreement in writing signed by Maker
and Payee.


 


IN WITNESS WHEREOF, intending to be legally bound, Maker has
caused this Secured Promissory Note to be executed as of the day and year first above written by its duly authorized and empowered
officer or representative.


 


	Innolog Holdings Corporation	 
	 	 	 
	By:	 	 
	William P. Danielczyk, Chairman	 
	 	 	 
	Innovative Logistics, Techniques, Inc.	 
	 	 	 
	By:	 	 
	Richard Stewart, President	 


 



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