SECURED
PROMISSORY NOTE


 


	$900,000.00	May 31, 2016


 


 


FOR
VALUE RECEIVED, each
of the undersigned
parties, jointly, severally, individually
and collectively (collectively
the “Company”), hereby
promises to pay
to the order of
COMPUTERLAW GROUP LLP,
a limited liability
law partnership of
the State of
California (“Payee”; Payee
and any subsequent
holders hereof are
hereinafter referred to
collectively as “Holder”), at
the address of
Computerlaw Group LLP,
attention to its
Managing Member, at
Jack Russo c/o Computerlaw Group LLP, 401 Florence Street, Palo Alto, California 94301, or at such other
place as Holder
may designate to
Company in writing
from time to
time, the principal
sum of Nine Hundred Thousand
and 00/100 Dollars
($900,000.00), together with
interest on the outstanding
principal balance hereof
at the rate
set forth herein
and all other
amounts that shall be payable herein
(collectively, the “Indebtedness”), in lawful money of the United States of America, which shall at the time of payment
be legal tender in payment of all debts and dues, public and private.


 


All
payments hereon shall
be made in
collected funds and
shall be applied
to principal, accrued interest,
and charges and
expenses owing on
or in connection
with this Secured Promissory
Note (this “Note”),
in such order
as Holder elects,
except that payment
shall be applied to
accrued interest before
principal.


 


Simple
interest shall accrue
on the outstanding
unpaid principal balance
of this Note
at a rate of
interest equal to
the statutory rate
of ten percent
(10%) per annum;
provided that no additional
interest shall be
due and this
Note will be
discounted to a
face amount of
$750,000 if payment in
full is made
in 15 monthly
installments of $50,000
per month commencing
on June 1, 2016
and continuing each
month for fourteen
additional monthly payments
of $50,000 on
July 1, August 1,
September 1, October 1,
November 1, December
1, 2016 and
January 1, February
1,


March
1, April 1,
May 1, June
1, July 1,
and August 1,
2017 but if
timely monthly payments
are not made then
the principal balance
shall remain at
$900,000 and the
interest thereon shall
accrue on the outstanding
unpaid principal balance
of this Note
at a rate
of interest equal
to ten percent (10%)
per annum commencing
on June 1,
2016. Interest hereunder
shall accrue daily
and be calculated on
the basis of
a 365-day year
for actual days
elapsed.


 


To
the extent not
earlier paid, all
principal and interest
under this Note
shall be due
and payable in full
on August 1,
2017 (the “Maturity
Date”); provided, if
all such principal
and interest is not
paid by or
on August 1,
2017, all principal
and interest not
previously paid under this
Note shall instead
be due and
payable in full
on August 2,
2017. The maturity
of the obligations may
be accelerated as
provided herein.


 


If
any payment is
due under this
Note on a
day that is
not a business
day on which national
banks are open
for business in
San Francisco, California,
then the payment
due hereunder shall be
payable on the
next such business
day on which
national banks are
open for business in
San Francisco, California.


 


The
Indebtedness evidenced by
this Note may
be prepaid in
whole or in
part without




    	 	1	 



     


    

permission
of the Holder.
Any such prepayment
shall be first
applied to all
charges and expenses owing
Holder in connection
with this Note,
then all accrued
and unpaid interest,
and then to unpaid
principal.


 


This
Note shall be
in default upon
the occurrence of
any of the
following events (each,
an “Event of Default”):


 


1. 
Any failure
to pay the
Indebtedness, or any
part thereof, when
and as the
same shall become due
and payable.


 


2. 
Any of the
undersigned parties shall
individually or collectively
(i) voluntarily commence any
proceeding or file
any petition or
any notice of
its intent to
commence or file
any proceeding, petition or
proposal, seeking relief
under Title 11
of the United
States Code or
any other federal or
state bankruptcy, insolvency
or similar law,
(ii) apply for
or consent to
the appointment of a
receiver, trustee, custodian,
sequestrator or similar
official for Company
or for any substantial
part of its
property or assets,
(iii) make a
general assignment for
the benefit of creditors,
or (iv) take
any corporate or
stockholder action in
furtherance of any
of the foregoing.


 


3.   
An involuntary
proceeding shall be
commenced or an
involuntary petition shall
be filed in a
court of competent
jurisdiction seeking (i)
relief in respect
of any undersigned
party or of any
substantial part of
the property or
assets thereof, under
Title 11 of
the United States
Code or any other
federal or state
bankruptcy, insolvency or
similar law, (ii)
the appointment of
a receiver, trustee, custodian,
sequestrator or similar
official for Company
or any substantial
part of its property
or (iii) the
winding-up or liquidation of
any of the
undersigned parties, and
such proceeding, petition or
order shall continue
unstayed and in
effect for a
period of 30
consecutive days.


 


4. 
Any entry
of a final
judgment, decree, levy,
attachment, garnishment or
other process, or the
filing of any
lien against Company
with respect to
any obligation in
excess of $25,000
and which is not
substantially covered by
insurance, or such
judgment or other
process shall not
have been, within sixty
(60) days from
the entry hereof,
(i) bonded over
to the satisfaction
of Holder and appealed,
(ii) vacated or
(iii) discharged.


 


5. 
Any liquidation
or dissolution by
any of the
undersigned parties or
any adoption by any
of the undersigned
parties of any
plan of liquidation
or dissolution.


 


6. 
Any resignation
or removal of
either or both
Ben Change and/or
Richard Change as executives
of any of
the undersigned parties
that is not
approved in writing
by the Holder.


 


If
any Event of
Default described in
Paragraphs 2 and
3 above occurs
all of the
unpaid principal, interest and
other amounts under
this Note shall
automatically become immediately
due and payable
in full. If
any other Event
of Default occurs
and continues without
cure for a period
of ten (10)
days after the
date of receipt
of written notice
of such Event
of Default, then the
entire principal sum
outstanding, together with
accrued interest thereon,
fees, charges and costs,
if any, after
the expiration of
said ten (10)
day cure period,
if applicable, shall
become immediately due and
payable upon the
election of the
Holder and notice
by the Holder
to the undersigned parties
of such election.
Each of the
undersigned parties agrees
to promptly give




    	 	2	 



     


    

written
notice to Holder
in reasonable detail
of any of
the foregoing defaults
in the event Company
becomes aware thereof.


 


Terms
used herein and
not defined herein
shall have the
meanings given such
terms in the Uniform
Commercial Code as
in effect in
the State of
California (the “UCC”).
As security for the
payment and performance
of the Indebtedness,
each of the
undersigned parties does
hereby pledge, assign, transfer,
deliver and grant
to Holder a
continuing and unconditional
security interest in and
to any and
all personal and
real property, of
any kind or
description, tangible or intangible,
wheresoever located and
whether now existing
or hereafter arising
or acquired, including, without
limitation, the following
(all of which
property existing now
and/or in the future,
along with the
products and all
proceeds therefrom existing
now or hereafter
in the future, are
individually and collectively
referred to as
the “Collateral”):


 


(a) 
all customer
agreements including all
Accounts and all
Goods whose sale,
lease, licensing or other
delivery or disposition
by Company has
given rise to
Accounts and have
been returned to, or
repossessed or stopped
in transit by,
or rejected or
refused by an
Account Debtor;


 


		(b)	all Inventory,
including raw materials,
work-in-process and finished
goods;



 


(c) 
all Goods
(other than Inventory),
including embedded software,
Equipment, vehicles, furniture and
Fixtures;


 


(d)  
All Software
and computer programs
and all other
electronically stored information
(“ESI”) including but
not limited to
all web sites,
web programming, and
all other associated assets
as well as
all patents, patent
applications, copyrights, copyright
applications, trademarks, trademark applications,
trade dress, trade
secrets, customer lists,
compilations, and all
other intellectual property rights
of all types
and kinds in
the United States
and throughout the
world


(collectively
the “IP Rights”);
Only secondary security interest granted where first priority security interest was already granted to others by Rich Pharmaceuticals,
Inc.


 


		(e)	All Securities,
Investment Property, Financial
Assets and Deposit
Accounts;



 


(f) 
all Chattel
Paper, Electronic Chattel
Paper, Instruments, Documents,
Letter of Credit Rights,
all proceeds of
letters of credit,
Health-Care-Insurance Receivables, Supporting
Indebtedness, notes secured
by real estate,
Commercial Tort Claims
and General Intangibles, including
Payment Intangibles; and,


 


(g)   
all other
personal property of
each of the
undersigned parties however
or wherever situated and
whether in the
possession of employees,
contractors or other
agents including but not
limited to all
documents of item,
certificates of ownership,
or other evidences
of rights which the
Company owns in
all personal property
now existing or
hereafter coming into
existence; and,


 


(h)  
all other
real property of
each of the
undersigned parties whether
located in California, New
Jersey or any
other location in
the United States
and each of
the undersigned parties agrees
to timely and
promptly execute such
mortgages, trust deeds
or other liens
thereon;


 


(h) 
all Proceeds
(whether Cash Proceeds
or Noncash Proceeds)
of the foregoing
personal property and/or real
property, including all
insurance policies and
proceeds of insurance
payable




    	 	3	 



     


    

by
reason of loss
or damage to
the foregoing property,
including unearned premiums,
and of eminent domain
or condemnation awards;


 


(i) 
any other
assets of any
type or nature
now existing or
which come into
existence in favor of
any of the
undersigned parties in
any respect and
for which the
intention hereby is
to have a first
priority security interest
and lien rights
as granted herein
to extend to
all such personal property,
real property or
other assets of
each and all
of the undersigned
parties.


 


Unless
an Event of
Default exists hereunder
and except as
otherwise provided herein, each
of the undersigned
parties in the
ordinary course of
business (and without
liquidation or other disposition
or transfer) shall
be entitled to
possession or use
of the Collateral;
however, in no event
shall any of
the undersigned parties
commit waste, bulk
sell, deposit into
“open source” (such as
SourceForge) or otherwise
take any action
which injures or
otherwise diminishes the value
of the Collateral
in any manner.


 


Each
of the undersigned
parties shall maintain
its existence and
shall not, except
upon 30 days’ prior
written notice to
the Holder and
the delivery of
any documents required
by Holder under the
next two paragraphs
in connection therewith,
(i) change its
name, jurisdiction of organization
or the location,
or (ii) change
its legal identity
or corporate structure.


 


Each
of the undersigned
parties shall, at
Holder’s request, at
any time and
from time to time,
execute and deliver
to Holder such
financing statements, amendments
and other documents and
do such acts
as Holder deems
necessary in order
to establish and
maintain valid, attached and
perfected security interests
in the Collateral
in favor of
Holder, free and
clear of all
liens, encumbrances and claims
and rights of
third parties whatsoever.
Each of the
undersigned parties hereby irrevocably
authorizes Holder at
any time, and
from time to
time, to file
in any jurisdiction any
initial financing statements
and amendments thereto
without the signature
of that party or
any of the
undersigned parties that
indicate the Collateral
is comprised of
all assets of that
party or each
of the undersigned
parties or words
of similar effect.
Each of the
undersigned parties further hereby
ratifies and affirms
its authorization for
any financing statements
and/or amendments thereto, executed and
filed by Holder in any
jurisdiction prior to the date of
this Note. Company represents
and warrants that
it has filed
UCC-1s on all
of the Collateral
(i) in and with the Secretary
of State of the State of Delaware, and (ii) with the United States Patent Office with respect
to any patents,
patent applications or
other patent rights,
whether choate or
inchoate, of any of the undersigned parties, and (iii) with the United States Trademark Office as to all of the applicable
Collateral that is a patent or patent application owned by any of the undersigned parties.


 


Each
of the undersigned
parties further agrees
to take any
other action reasonably requested
by the Holder
to ensure the
attachment, perfection and
priority of, and
the ability of
the Holder to enforce,
Holder’s security interest
in any and
all the Collateral,
including (a) causing Holder’s
name to be
noted as secured
party on any
certificate of title
for a titled
good if such notation
is a condition
to attachment, perfection
or priority of,
or ability of
Holder to enforce, Holder’s
security interest in
such Collateral, (b)
complying with any
provision of any
statute, regulation or treaty
of the United
States as to
any Collateral if
compliance with such
provision is a condition
to attachment, perfection
or priority of,
or ability of
Holder to enforce,
Holder’s security interest in
such Collateral, (c)
obtaining governmental and
other third party
consents and




    	 	4	 



     


    

approvals,
including any consent
of any licensor,
lessor or other
person or entity
obligated on Collateral, (d)
obtaining waivers from
mortgagees and landlords
in form and
substance satisfactory to Holder,
and (e) taking
all actions required
by the UCC
in effect from
time to time or
by other law,
as applicable in
any relevant UCC
jurisdiction, or by
other law as
applicable to such Collateral
or in any
such foreign jurisdiction.
Each of the
undersigned parties further
agrees to indemnify and
hold Holder harmless
against claims of any
persons or entities
concerning disputes arising over
the Collateral.


 


The
validity, construction and
enforceability of, and
the rights and
obligations of Company and
Holder under this
Note shall be
governed by, construed
and enforced in accordance
with, the laws
of the State
of California.


 


Time
is of the
essence of each
obligation of Company
hereunder. Each of
the undersigned parties represents
and warrants that
it has filed
UCC-1s with each
governmental entity necessary and/or
appropriate for the
perfection of all
security interests herein
and that all security
interests are first
priority security interests
granted and perfected
as of the
date of the Closing;
no other liens
exist.


 


Notwithstanding
anything to the
contrary contained herein,
the effective rate
of interest on the
Indebtedness shall not
exceed the lawful
maximum rate of
interest permitted to
be paid. Without limiting
the generality of
the foregoing, in
the event the
interest charged hereunder results
in an effective
rate of interest
higher than that
lawfully permitted to
be paid, then
such charges shall be
reduced by the
sum sufficient to
result in an
effective rate of
interest permitted, and any
amount which would
exceed the highest
lawful rate already
received and held
by Holder shall be
applied to a
reduction of principal
(without premium or
penalty) and not
to the payment of
interest.


 


In
the event any
provision of this
Note (or any
part of any
provision hereof) is
held by a court
of competent jurisdiction
to be invalid,
illegal or unenforceable
in any respect,
such invalidity, illegality or
unenforceability shall not
affect any other
provision (or remaining
part of the affected
provision) of this
Note; but this
Note shall be
construed as if
such invalid, illegal
or unenforceable provision (or
part thereof) had
not been contained
in this Note,
but only to
the extent it is
invalid, illegal or
unenforceable.


 


Each
of the undersigned
parties, for himself,
herself and itself
and his, her
and its successors and
assigns, waives presentment,
protest and demand,
notice of protest,
demand, dishonor and nonpayment
of this Note,
and expressly agrees
that this Note,
or any payment hereunder,
may be extended
from time to
time without in
any way affecting
the liability of
any of the undersigned
parties, individually, jointly
or severally, or
any endorser or
guarantor hereof.


 


This
Note may not
be changed orally,
but only by
an agreement in
writing signed by
the party against whom
enforcement of any
waiver, change, modification
or discharge is
sought.


Each
of the undersigned
parties, jointly and
severally and individually
and collectively agrees
to pay all reasonable
attorneys’ fees, expenses,
court costs and
all other costs
of whatever kind incident
to the collection,
enforcement, protection and
defense of this
Note, and the
collection, enforcement, protection and
defense of any
security for this
Note and the
perfection and priority of
Holder’s interest in
any security for
this note, and
all attorneys’ fees,
expenses, costs,




    	 	5	 



     


    

recording
fees, and other
costs of whatever
kind incident to
and necessary to
document, record, perfect and
continue the priority
and perfection of
the security interests
in personal property
and the mortgages, trust
deeds and/or other
lien interests in
any and all
real property of
each of the undersigned
parties. Each of
the undersigned parties
shall execute such
further documents including mortgages,
trust deeds or
other instruments as
may be reasonably
necessary or appropriate to
further perfect any
of the rights
granted Holder under
the terms and conditions
of the foregoing Secured
Promissory Note including
such notarized signatures
as may be
requested from time to
time by the
Holder hereof until
the indebtedness including
all principal, all
interest, and all fees,
costs and expenses
are paid in
full hereunder. The
undersigned parties hereby
agree that any legal
action or other
proceedings hereunder may
be brought in
the Courts in
Santa Clara County, California
and each hereby
consent to the
jurisdiction of said
Courts and further
that reasonable attorney’s fees,
costs and expenses
shall be added to
all amounts due
hereunder if default occurs
and is not
cured within 10
days of written
notice thereof. The
signature of each individual
below extends to
any limited liability
company, corporation, trust,
or other entity which
is owned or
controlled by or
under common control
with said individual
and each such affiliate
of each undersigned
party is bound
by this Secured
Promissory Note.


 


IN
WITNESS WHEREOF, the
undersigned has duly
executed this Secured
Promissory Note as of
the date first
set forth above.


 


 


Ben
Chang, individually: /s/ Ben Chang


 


Richard
Chang, individually: /s/ Richard Chang


 


 


RICH
PHARMACEUTICALS, INC.


 


By: /s/ Ben Chang


Name:
Ben Chang


Title:CEO
& President


Email:
b.chang@richpharmaceuticals.com



    	 	6