AyurCore, Inc.
PROMISSORY NOTE
March 24, 1998
FOR VALUE RECEIVED, AyurCore, Inc., a Delaware Corporation
("Borrower"), promises to pay to the order of Sanjeev Chitre
("Lender"), the principal amount of $279,655.84, together with
interest on the unpaid principal balance thereof from the respective
dates Lender loaned such amounts to the Borrower as set forth on
Schedule A attached hereto to the date such balance is paid, at the
prime rate shown in the Western Edition of the Wall Street Journal,
plus 2% annum. Interest shall be due and payable on June 30 and
December 31, of each year. Principal shall be due on demand from and
after the respective maturity dates set forth on Schedule A; provided,
however, that if Borrower shall conclude a debt or equity financing of
$500,000 or more at any time after the date hereof and prior to the
date any principal amount hereunder shall otherwise become due and
payable, such unpaid principal and accrued interest hereunder shall be
payable on the fifth business day after the closing of such financing.
If any one or more of the following events ("Events of Default") shall
occur:
(a) Borrower shall fail to pay any amount under this Promissory
Note when the same shall become due and payable, whether at
maturity or by acceleration or otherwise; or
(b) (i) the Borrower shall commence any action (A) under any
law relating to bankruptcy, insolvency, reorganization or relief
of debtors, seeking to have an order for relief entered with
respect to the Borrower or its debts or (B) seeking appointment
of a custodian, receiver or similar officer for the Borrower or
any substantial part of its property; or (ii) any action of a
nature referred to above shall be commenced against the Borrower
and results in an order for relief or is not dismissed,
discharged or fully bonded within 30 days; or (iii) there shall
be commenced against the Borrower any action seeking attachment,
execution or similar process against any substantial part of the
Borrower's property, which action is not within 30 days
discharged or stayed or fully bonded; or (iv) the Borrower shall,
by act or omission, indicate its consent to or acquiescence in
any of the foregoing, without regard to the grace periods set
forth above; or (v) the Borrower shall be unable, or admit in
writing, inability to pay the Borrower's debts as they become
due; or (vi) the Borrower shall transfer or conceal its property
within intent to hinder, delay or defraud any creditors or to
benefit any class of creditors or creditors generally or shall
suffer for 30 days or longer while insolvent any lien on the
Borrower's property resulting from judicial proceedings; or
(c) the dissolution or other winding up of the Borrower;
then, in such event and at any time thereafter, if such event shall
then be continuing, Lender may, at its option upon written notice to
Borrower, declare this Promissory Note to be due an payable, whereupon
(or without the necessity for such notice in the case of any event
described in clause (i) or (ii) of paragraph (b) above) the entire
balance of this Promissory Note shall forthwith become and be due and
payable.
Except as otherwise hereinabove expressly provided, Borrower hereby
waives diligence, demand, protest, presentment and all notices
(whether of nonpayment, dishonor, protest, acceleration or otherwise)
and consents to acceleration of the time of payment and to surrender,
substitution or any other action or inaction with respect to security
and to forbearance and to other indulgence, all without notice.
Failure of Lender to assert any right herein shall not be deemed a
waiver thereof.
The Borrower shall have the right, at any time, to prepay without
penalty all of this Promissory Note together with accrued interest
thereon.
Lender shall not assign its rights hereunder without the prior written
consent of Borrower.
This Promissory Note supersedes in all respects the Promissory Note
dated as of January 29, 1998 issued by the Borrower in favor of the
Lender.
This Promissory Note shall be governed by and construed in accordance
with the laws of the State of New York applicable to contracts made
and to be performed wholly within such State.
IN WITNESS WHEREOF, the Borrower has signed this Promissory Note as of
the date first written above.
AyurCore, Inc.
By: s/ Nina Renaud
----------------------------
Nina Renaud, Chief Financial
Officer
Authorized Signatory
SCHEDULE A
Chitre Promissory Note
Principal Amount Loaned
Date by Lender to Borrower Maturity Date
1/15/96 $25,000 1/15/97
8/15/96 $38,000 8/15/97
9/5/96 $6,300 9/5/97
9/17/96 $6,150 9/17/97
9/30/96 $4,000 9/30/97
10/8/96 $8,000 10/8/97
10/11/96 $4,250 10/11/97
10/23/96 $25,000 10/23/97
2/20/97 $25,000 2/20/98
3/20/97 $25,000 3/20/98
5/28/97 $15,000 5/28/98
6/15/97 $5,500 6/15/98
6/29/97 $2,500 6/29/98
7/14/97 $15,000 7/14/98
12/16/97 $25,000 12/16/98
1/21/98 $11,380.84 1/21/99
1/29/98 $10,000 1/29/99
3/24/98 $28,575 3/24/99
$279,655.84
May 26, 1998
Deepa Chitre
Chief Executive Officer
AyurCore, Inc.
1737 N. First Street, Suite 290
San Jose, California 95112
Dear Mrs. Chitre:
Reference is hereby made to that certain Promissory Note, dated as of
March 24, 1998, made by AyurCore, Inc. ("AyurCore") in favor of Sanjeev Chitre
(the "Note). In order to facilitate AyurCore's contemplated initial public
offering (the "Offering"), the undersigned hereby agrees that no payments shall
be due or payable under the Note prior to the first anniversary of the
consummation of the Offering; provided, however, that this agreement shall be of
no further force or effect if the Offering shall not be consummated by
August 1, 1998.
s/ Sanjeev Chitre
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Sanjeev Chitre