VSPC Viaspace Inc (CE)

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

VIASPACE Inc.
__________________________________________
(Exact name of registrant as specified in its charter)

Not Applicable
______________________________________________
Former name or former address, if changed since last report

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

[  ]  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[  ]  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[  ]  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[  ]  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01 Entry into a Material Definitive Agreement.

Loan Agreement Dated January 25, 2016

Effective as of January 25, 2016, the Registrant and Schewe entered into a Loan Agreement pursuant to which Schewe agreed, subject to satisfaction of certain conditions, including among other things, Schewe’s satisfaction with the use proceeds of past loans, to provide loans of up to $300,000 as required by the Company for a one-year period. The loans would be evidenced by a Secured Convertible Note. The Note (as with all subsequent notes) accrued interest at 8% per annum, were secured by all assets of the Registrant pursuant to a Security Agreement ("Security Agreement") and would be convertible into shares of Registrant common stock at a price equal to 20% of the average closing price for the 20 trading days prior to the issuance of the loan. Each note would mature on the second anniversary of the issuance date of such note.

The Loan Agreement, the Security Agreement and the Form of Senior Secured Promissory Note are attached hereto as Exhibits 10.1 through 10.3, respectively.


Loan Agreement Dated January 27, 2016

On January 27, 2016, Dr. Kevin Schewe, Director of the Registrant, made a $15,000 loan to the Registrant in conjunction with the Loan Agreement entered into with the Registrant on January 25, 2016. In the Loan Agreement, Schewe agreed, subject to satisfaction of certain conditions, including among other things, Schewe’s satisfaction with the use of proceeds of past loans, to provide loans of up to $300,000 as required by the Registrant for a one-year period. The loans would be evidenced by a Secured Convertible Note. The loans accrue interest at 8% per annum and are secured by all assets of the Registrant. At Schewe's election, the notes are convertible into shares of Registrant common stock at a price equal to 20% of the average closing price of the Registrant's common stock for the 20 trading days immediately preceeding the date of the loan. Each note matures on the first anniversary of the issuance date of such note. If Schewe chooses to convert, the $15,000 loan made on January 27, 2016 would convert into 37,500,000 shares of Registrant common stock at a common stock price of $0.0004 per share.

Including the newest loan, Schewe has made cumulative loans to the Registrant totaling $15,000 since the execution of the Loan Agreement.

The Note for the loan on January 27, 2016 is attached hereto as Exhibit 10.1.


Notice of Conversion of January 27, 2016 Loan

On January 27, 2016, Dr. Kevin Schewe, Director of the Registrant, in conjunction with the Loan Agreement entered into with the Registrant on January 27, 2016, converted $15,000 of loans that he previously made to the Registrant into shares of Registrant common stock.

Schewe had made a $15,000 loan to the Registrant on January 27, 2016. The $15,000 loan owed to him converted into 37,500,000 shares of Registrant common stock at a conversion price of $0.0004 per common share.

Item 3.02 Unregistered Sales of Equity Securities.

On January 27, 2016, the Registrant issued 37,500,000 shares of Registrant common stock to Dr. Kevin Schewe, Director of the Registrant, related to a loan on January 27, 2016. The shares were issued related to the conversion by Schewe of two convertible notes as discussed in detail in Item 1.01. The Registrant relied upon Section 4(2) of the Securities Act of 1933, as amended, for the offer and sale of its stock. It believed that Section 4(2) was available because the offer and sale was not a public offering of its securities and there was no general solicitation or general advertising involved in the offer or sale.

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

(a) Resignation of director

On January 24, 2016, Mr. Khurram Irshad notifed the Registrant that he was resigning as a director of the Registrant. Mr. Irshad informed us that he is resigning in connection with the termination of the Consulting Agreement with Amaanco and the Registrant. A copy of the written correspondence regarding this resignation is attached as Exhibit 10.5. The Registrant provided a copy of the disclosures it is making in response to this Item 5.02 to Mr. Irshad and informed him that he may furnish the Registrant as promptly as possible with a letter stating whether he agrees or disagrees with the disclosures made in response to this Item 5.02, and that if he disagrees, then the Registrant requests that he provide the respects in which he does not agree with the disclosures. The Registrant will file any letter received from Mr. Irshad as an exhibit to an amendment to this current report on Form 8-K within two business days after receipt by the Registrant.

Item 9.01 Financial Statements and Exhibits.

(c) Exhibits

Exhibit No. Description

10.1 Loan Agreement between Registrant and Kevin Schewe dated January 25, 2016.
10.2 Security Agreement between Registrant and Kevin Schewe dated January 25, 2016.
10.3 Form of Senior Secured Convertible Promissory Note between Registrant and Kevin Schewe.
10.4 Senior Secured Convertible Promissory Note dated January 27, 2016.
10.5 Resignation Letter of Khurram Irshad.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Exhibit Index

EX. 10.1

LOAN AGREEMENT

THIS LOAN AGREEMENT (this “Agreement”), is executed as of January 25, 2016, by and between VIASPACE Inc., a Nevada corporation (the “Company”), and Kevin Schewe, an individual (the “Lender”).

WHEREAS, the Company and the Lender entered into a prior Loan Agreement in which the Lender agreed to loan up to $1,000,000 and the Lender has funded the entire loan amount under such Agreement;

WHEREAS, in order to fund the Company’s operations for the near future, the Company wishes to borrow up to an additional $300,000 from the Lender as a secured convertible note (“Aggregate Loan Limit”); and

WHEREAS, the Lender is willing to provide such financing on terms and conditions as set forth herein.

NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and the Lender, intending to be legally bound, agree as follows:

ARTICLE 1
DEFINITIONS

1.1 Defined terms. Certain capitalized terms used in this Agreement shall have the specific meanings defined below:

“Additional Loan Closing Date” shall mean the date upon which any Additional Loan is made to the Company.

“Business Day” shall mean a day other than a Saturday, Sunday, or other day on which commercial banks are authorized or required by law to close.

“Initial Loan Closing Date” shall mean the date upon which the Initial Loan is made to the Company.

“Interest Rate” shall mean eight percent (8%) per annum.

“Maturity Date” shall mean the first anniversary of the date of the issuance of the Note.

“Principal Market” shall be the principal trading exchange or market on which the Company’s Common Stock is traded, including without limitation, American Stock Exchange, Nasdaq Capital Market, Nasdaq Global Market, Nasdaq Global Select Market, Bulletin Board, or New York Stock Exchange.

“Average Closing Price” shall mean the average closing price of the Common Stock on the principal trading exchange on which the Company’s Common Stock is traded.

ARTICLE 2
THE LOANS

2.1 Initial Loan. According to the terms and subject to the conditions of this Agreement, the Lender shall make a single-installment loan to the Company on the Initial Loan Closing Date in an amount determined by Lender in his sole discretion (the “Initial Loan”), and may advance additional Loans, upon the Company’s request and accordance with the terms set forth in Section 2.2, in the amount up to $300,000 less the amount of the Initial Loan (the "Additional Loans”) (the Initial Loan and the Additional Loan, if any, shall be referred to collectively as the “Loans”). The Loans shall be each evidenced by a secured convertible promissory note in the form attached hereto as Exhibit A (“Note”), duly executed on behalf of the Company and dated as of the Initial Loan Closing Date. The Note shall be convertible, upon Lender’s request, into shares of Company common stock at a price per share equal to twenty percent (20%) of the Average Closing Price as reported by the principal trading exchange on which the Company’s Common Stock is traded for the twenty (20) trading days preceding the date of the Note.

2.2 Additional Loans. Provided there is no Event of Default under this Agreement and within sixty (12) months of this Agreement, the Company may notify the Lender in writing at any time after 30 days from the most recent Closing Date that the Company after reviewing its working capital requirements and its annual budget with its Board of Directors, has determined that it needs to borrow an Additional Loan. Subject to the conditions set forth in Section 3.2, the Lender may make the Loan, which shall be no less than $5,000 per Additional Loan, within 15 days of the request for the Additional Loan but after the conditions in Article 3 have been satisfied. Each Additional Loan shall be evidenced by a Note, duly executed on behalf of the Company and dated as of each Additional Loan Closing Date. The aggregate amount of the Loans under the Initial Loan and the Additional Loans shall not exceed the Aggregate Loan Amount.

2.3 Interest. The Loan shall bear interest (“Interest”) from the date of payment by the Lender until the Maturity Date at the Interest Rate (calculated on the basis of the actual number of days elapsed over a year of 360 days). Interest is payable by the Company on a monthly basis in arrears on the first Business Day of the month.

2.4 Prepayment of the Loan. The Company may from time to time prepay all or any portion of the Loan without premium or penalty of any type. The Company shall give the Lender at least three Business Days’ prior written notice of its intention to prepay the Loan, specifying the date of payment and the total amount of the Loan to be paid on such date.

2.5 Maturity Date. The Loan shall be due on the applicable Maturity Date.

2.6 Use of Proceeds. The proceeds of the Loan shall be used for working capital purposes of the Company related to general operations and also including the commercialization of the Giant King Grass business.

ARTICLE 3
CONDITIONS PRECEDENT TO THE LOAN

3.1 Conditions on the Initial Loan Closing Date. The obligation of the Lender to make the Initial Loan pursuant to Section 2.1 shall be subject to the satisfaction, on or before the Initial Loan Closing Date, of the conditions set forth in this Section. If the conditions set forth in this Section are not met on or prior to the Initial Loan Closing Date, the Lender shall have no obligation to make the Initial Loan.

(a) The Company shall have duly executed and delivered to the Lender the Note representing the Initial Loan.

(b) The Company shall have duly authorized, executed, and delivered to the Lender a security agreement in the form attached hereto as Exhibit B (the “Security Agreement”) to secure the repayment of each Loan and granting the Lender a continuing security interest in all presently existing and hereafter acquired assets and property of the Company.

3.2 Conditions on the Additional Loan Closing Date. The obligation of the Lender to make the Additional Loan(s) pursuant to Section 2.2 shall be subject to the satisfaction, on or before the date on which such Loan is made, of the conditions set forth in this Section. If the conditions set forth in this Section are not met on or prior to such date, the Lender shall have no obligation to make the Additional Loan.

(a) The Company shall have duly executed and delivered to the Lender the Note representing the Additional Loan.

(b) The Company shall have used the proceeds from prior Loans and allocated resources in a manner that is reasonably satisfactory to the Lender.

(c) In the Lender’s sole opinion, neither the Lender’s financial condition shall have suffered a material adverse effect nor his other financial commitments or obligations shall have materially increased.

ARTICLE 4
REPRESENTATIONS AND WARRANTIES

4.1 Due Incorporation and Good Standing. The Company is a corporation duly organized, validly existing and in good standing under the laws of the State of Nevada, with full and adequate power to carry on and conduct its business as presently conducted, and is duly licensed or qualified in all foreign jurisdictions wherein the failure to be so qualified or licensed would reasonably be expected to have a material adverse effect on the business of the Company.

4.2 Due Authorization. The Company has full right, power and authority to enter into this Agreement, to make the borrowings hereunder and execute and deliver the Note as provided herein and to perform all of its duties and obligations under this Agreement and the Note.

4.3 Enforceability. This Agreement has been validly executed and delivered by the Company and constitutes the legal, valid and binding obligations of the Company enforceable against it in accordance with its respective terms, subject to applicable bankruptcy, insolvency, reorganization or similar laws relating to or affecting the enforcement of creditors’ right and to the availability of the remedy of specific performance.

ARTICLE 5
DEFAULT

5.1 Events of Default. The occurrence of any of the following events (each an “Event of Default”), not cured in the applicable cure period, if any, shall constitute and Event of Default of the Company:

(a) the failure to make when due any payment described in this Agreement or the Note, whether on or after the Maturity Date, by acceleration or otherwise; and

(b) (i) the application for the appointment of a receiver or custodian for the Company or the property of the Company, (ii) the entry of an order for relief or the filing of a petition by or against the Company under the provisions of any bankruptcy or insolvency law, (iii) any assignment for the benefit of creditors by or against the Company, or (iv) the Company becomes insolvent.

5.2 Effect of Default. Upon the occurrence of any Event of Default that is not cured within any applicable cure period, the Lender may elect, by written notice delivered to the Company, to take any or all of the following actions: (i) declare this Agreement terminated and the outstanding amounts under the Note to be forthwith due and payable, whereupon the entire unpaid Loan, together with accrued and unpaid Interest thereon, and all other cash obligations hereunder, shall become forthwith due and payable, without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived by the Company, anything contained herein or in any of the Note to the contrary notwithstanding, and (ii) exercise any and all other remedies provided hereunder or available at law or in equity upon the occurrence and continuation of an Event of Default. In addition, during the occurrence of any Event of Default, the Company shall not pay make any payment on any other outstanding indebtedness of the Company (other than indebtedness of the Company to which the Lender has agreed in writing to subordinate this Agreement and the Note hereunder).

ARTICLE 6
MISCELLANEOUS

6.1 Successors and Assigns. Subject to the exceptions specifically set forth in this Agreement, the terms and conditions of this Agreement shall inure to the benefit of and be binding upon the respective executors, administrators, heirs, successors and assigns of the parties. This Agreement may be assigned solely by the Lender.

6.2 Titles and Subtitles. The titles and subtitles of the Sections of this Agreement are used for convenience only and shall not be considered in construing or interpreting this agreement.

6.3 Notices. Any notice, request or other communication required or permitted hereunder shall be in writing and shall be delivered personally or by facsimile (receipt confirmed electronically) or shall be sent by a reputable express delivery service or by certified mail, postage prepaid with return receipt requested, addressed as follows:

if to the Company, to:

Either party hereto may change the above specified recipient or mailing address by notice to the other party given in the manner herein prescribed. All notices shall be deemed given on the day when actually delivered as provided above (if delivered personally or by facsimile, provided that any such facsimile is received during regular business hours at the recipient’s location) or on the day shown on the return receipt (if delivered by mail or delivery service).

6.4 Governing Law. This Agreement shall be governed by and construed in accordance with the domestic laws of the State of Colorado without giving effect to any choice of law or conflict of law provision or rule (whether of the State of Colorado or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Colorado.

6.5 Waiver and Amendment. Any term of this Agreement may be amended, waived or modified with the written consent of the Company and the Lender.

6.6 Remedies. No delay or omission by the Lender in exercising any of its rights, remedies, powers or privileges hereunder or at law or in equity and no course of dealing between the Lender and the undersigned or any other person shall be deemed a waiver by the Lender of any such rights, remedies, powers or privileges, even if such delay or omission is continuous or repeated, nor shall any single or partial exercise of any right, remedy, power or privilege preclude any other or further exercise thereof by the Lender or the exercise of any other right, remedy, power or privilege by the Lender. The rights and remedies of the Lender described herein shall be cumulative and not restrictive of any other rights or remedies available under any other instrument, at law or in equity.

• * * * *

IN WITNESS WHEREOF, the Company has caused this Loan Agreement to be signed in its name on the date first set forth above.

VIASPACE INC.

KEVIN SCHEWE

/S/ HARIS BASIT—

EXHIBIT A
SECURED CONVERTIBLE PROMISSORY NOTE

See attached.

EXHIBIT B
SECURITY AGREEMENT

See attached.

EX. 10.2

SECURITY AGREEMENT

1. GRANT OF SECURITY INTEREST. To secure the payment of all present and future indebtedness of VIASPACE, Inc., a Nevada corporation (“Debtor”) to Kevin Schewe (“Schewe”) evidenced by one of more promissory notes (the “Notes”) issued in connection with that Loan Agreement made by Debtor and Schewe and payable to the order of Schewe as specified in the Notes (the “Indebtedness”), and as a condition to the closing of each Note made by Debtor to Schewe, Debtor hereby grants and transfers to Schewe a first priority security interest in all of the following property of Schewe (collectively, the “Collateral”):

(a) all accounts, deposit accounts, contract rights, chattel paper, instruments, documents, general intangibles and other rights to payment of every kind now existing or at any time hereafter arising;

(b) all inventory, goods held for sale or lease or to be furnished under contracts for service, or goods so leased or furnished, raw materials, component parts, work in process and other materials used or consumed in Debtor’s business, now or at any time hereafter owned or acquired by Debtor, wherever located, and all products thereof, whether in the possession of Debtor, any warehousemen, any bailee or any other person or entity, or in process of delivery, and whether located at Debtor’s place of business or elsewhere;

(c) all warehouse receipts, bills of sale, bills of lading and other documents of every kind (whether or not negotiable) in which Debtor now has or at any time hereafter acquires any interest, and all additions and accessions thereto, whether in the possession or custody of Debtor, any bailee or any other person or entity for any purpose;

(d) all right, title and interest of Debtor under licenses, guaranties, warranties, management agreements, marketing or sales agreements, escrow contracts, indemnity agreements, insurance policies, service agreements, maintenance agreements and other similar contracts of every kind in which Debtor now has or at any time hereafter shall have an interest;

(e) all of Debtor’s goods, tools, machinery, furnishings, furniture and other equipment and fixtures of every kind now existing or hereafter acquired, and improvements, replacements, accessions and additions thereto, wherever located, including without limitation, any of the foregoing now or at any time hereafter located at or installed on the land or in the improvements at any of the real property owned or leased by Debtor, and all such goods after they have been severed and removed from any of said real property; and

(f) all of Debtor’s motor vehicles, trailers, mobile homes, boats, other rolling stock and related equipment of every kind now existing or hereafter acquired and all additions and accessories thereto, whether located on any property owned or leased by Debtor or elsewhere;

(g) all present and future general intangibles, all tax refunds of every kind of nature to which Debtor now or hereafter may become entitled, however arising, all other refunds, and all deposits, goodwill, choses in action, trade secrets, computer programs, software, customer lists, trademarks, trade names, patents, licenses, copyrights, technology, processes, proprietary information and insurance proceeds relating to or arising out of its business;

(h) all present and future books and records, including, without limitation, books of account and ledgers of every kind and nature, all electronically recorded data relating to Debtor or the business thereof, all receptacles and containers for such records, and all files and correspondence relating to or arising out of its business;

(i) all present and future accessions, appurtenances, components, repairs, repair parts, spare parts, replacements, substitutions, additions, issue and/or improvements to or of or with respect to any of the foregoing;

(j) all other tangible and intangible property of Debtor relating to or arising out of the Collateral, including but not limited to the name “Debtor Circuits”;

(k) all rights, remedies, powers and/or privileges of Debtor with respect to any of the foregoing; and

together with whatever is receivable or received when any of the foregoing or the proceeds thereof are sold, leased, collected, exchanged or otherwise disposed of, whether such disposition is voluntary or involuntary, including without limitation, all rights to payment, including without limitation returned premiums, with respect to any insurance relating to any of the foregoing, and all rights to payment with respect to any cause of action affecting or relating to any of the foregoing (collectively, “Proceeds”).

2. TERMINATION. This Agreement shall terminate and be of no further force and effect upon the indefeasible payment in full of the Indebtedness, and Schewe shall promptly upon the request of Debtor execute any and all termination statements and other instruments reasonably necessary to terminate and release the security interests in the Collateral created hereunder.

3. WAIVER OF STATUTE OF LIMITATIONS; REINSTATEMENT OF LIABILITY. Debtor acknowledges that this Agreement is absolute and unconditional, there are no conditions precedent to the effectiveness of this Agreement, and this Agreement is in full force and effect and is binding on Debtor as of the date written below, regardless of whether Schewe obtains collateral or any guaranties from others or takes any other action contemplated by Debtor. Debtor waives the benefit of any statute of limitations affecting its liability hereunder or the enforcement thereof and agrees that any payment of any Indebtedness or other act which shall toll any statute of limitations applicable thereto shall similarly operate to toll such statute of limitations applicable to its liability hereunder.

4. REPRESENTATIONS AND WARRANTIES. Debtor represents and warrants to Schewe that:  (a) Debtor is the Debtor and has possession or control of the Collateral and Proceeds; (b) Debtor has the right to grant a security interest in the Collateral and Proceeds; (c) all Collateral and Proceeds are genuine, free from liens, adverse claims, setoffs, default, prepayment, defenses and conditions precedent of any kind or character, except the lien created hereby, or as heretofore disclosed by Debtor to Schewe in writing pursuant to Schedule 1; (d) all statements contained herein and, where applicable, in the Collateral are true and complete in all material respects; (e) where Collateral consists of rights to payment, all persons or entities appearing to be obligated on the Collateral and Proceeds have authority and capacity to contract and are bound as they appear to be, all property subject to chattel paper has been properly registered and filed in compliance with law and to perfect the interest of the applicable Debtor in such property, and all such Collateral and Proceeds comply with all applicable laws concerning form, content and manner of preparation and execution, including where applicable federal and any state consumer credit laws; and (f) where the Collateral consists of equipment, Debtor is not in the business of selling goods of the kind included within such Collateral, and Debtor acknowledges that no sale of any such Collateral, including without limitation any such Collateral which the applicable Debtor may deem to be surplus, has been consented to or acquiesced in by Schewe, except as specifically set forth in writing by Schewe.

5. COVENANTS OF DEBTOR.

(a) Debtor agrees in general:  (i) to indemnify Schewe against all losses, claims, demands, liabilities and expenses of every kind caused by property subject hereto; (ii) to pay all costs and expenses, including without limitation reasonable attorneys’ fees and costs, incurred by Schewe in the perfection and preservation of the Collateral or Schewe’s interest therein and/or the realization, enforcement and exercise of Schewe’s rights, powers and remedies hereunder; (iii) to permit Schewe to exercise its powers; (iv) to execute and deliver such documents as Schewe deems necessary to create, perfect and continue the security interests contemplated hereby; and (v) not to change Debtor’s chief executive office or the places where Debtor keeps any of the Collateral or any of Debtor’s records concerning the Collateral and Proceeds without first giving Schewe written notice of the address to which Debtor is moving same.

(b) Debtor agrees with regard to the Collateral and Proceeds, unless Schewe agrees otherwise in writing:  (i) where applicable, to insure the Collateral with Schewe as loss payee, in form, substance and amounts, under agreements, against risks and liabilities, and with insurance companies reasonably satisfactory to Schewe; (ii) where applicable, to operate the Collateral in accordance with all applicable statutes, rules and regulations relating to the use and control thereof, and not to use any Collateral for any unlawful purpose or in any way that would void any insurance required to be carried in connection therewith; (iii) not to remove the Collateral from Debtor’s premises, except (A) for deliveries to buyers in the ordinary course of Debtor’s business and (B) Collateral which consists of mobile goods as defined in the California Uniform Commercial Code, in which case Debtor agrees not to remove or permit the removal of such Collateral from its state of domicile for a period in excess of thirty (30) calendar days; (iv) to pay prior to delinquency all license fees, registration fees and other charges in connection with any Collateral; (v) to permit Schewe to inspect the Collateral at any reasonable time; (vi) to keep complete and accurate records regarding all Collateral and Proceeds, and to permit Schewe to inspect the same and make copies thereof at any reasonable time; (vii) after the occurrence and during the continuance of any Event of Default, if requested by Schewe, to receive and use reasonable diligence to collect Collateral consisting of accounts and other rights to payment and Proceeds, in trust and as the property of Schewe, and to immediately endorse as appropriate and deliver such Collateral and Proceeds to Schewe daily in the exact form in which they are received together with a collection report in form satisfactory to Schewe; (viii) not to commingle Collateral or Proceeds, or collections thereunder, with other property; (ix) to give only normal allowances and credits and to advise Schewe thereof immediately in writing if they affect any rights to payment or Proceeds in any material respect; (x) from time to time, when requested by Schewe, to prepare and deliver a schedule of all Collateral and Proceeds subject to this Agreement and after the occurrence and during the continuance of any Event of Default, to assign in writing and deliver to Schewe all accounts, contracts, leases and other chattel paper, instruments, documents and other evidences thereof; (xi) after the occurrence and during the continuance of any Event of Default, in the event Schewe elects to receive payments of rights to payment or Proceeds hereunder, to pay all expenses incurred by Schewe in connection therewith, including without limitation expenses of accounting, correspondence, collection efforts, reporting to account or contract debtors, filing, recording, record keeping and expenses incidental thereto; and (xii) to provide any service and do any other acts which may be reasonably necessary to maintain, preserve and protect all Collateral and, as appropriate and applicable, to keep all Collateral in good and saleable condition, to deal with the Collateral in accordance with the standards and practices adhered to generally by users and manufacturers of like property, and to keep all Collateral and Proceeds free and clear of all defenses, rights of offset and counterclaims.

6. POWERS OF SCHEWE. Debtor appoints Schewe its true attorney in fact to perform any of the following powers, which are coupled with an interest, are irrevocable until termination of this Agreement and may be exercised from time to time by Schewe’s agents, or any of them, whether or not Debtor is in default:  (a) to perform any obligation of Debtor’s hereunder in Debtor’s name or otherwise which Debtor has failed to perform after reasonable notice or after the occurrence and during the continuance of any Event of Default; (b) to give notice to account debtors or others of Schewe’s rights in the Collateral and Proceeds, and after the occurrence and during the continuance of an Event of Default (as defined below) to enforce the same and make extension agreements with respect thereto; (c) after the occurrence and during the continuance of any Event of Default, to release persons or entities liable on Collateral or Proceeds and to give receipts and acquittances and compromise disputes in connection therewith; (d) after the occurrence and during the continuance of any Event of Default, to release security; (e) after the occurrence and during the continuance of any Event of Default, to resort to security in any order; (f) to prepare, execute, file, record or deliver notes, assignments, schedules, designation statements, financing statements, continuation statements, termination statements, statements of assignment, applications for registration or like papers to perfect, preserve or release Schewe’s interest in the Collateral and Proceeds; (g) after the occurrence and during the continuance of an Event of Default, to receive, open and read mail addressed to Debtor; (h) to take cash, instruments for the payment of money and other property to which Schewe is entitled; (i) to verify facts concerning the Collateral and Proceeds by inquiry of obligors thereon, or otherwise, in its own name or a fictitious name; (j) after the occurrence and during the continuance of an Event of Default, to endorse, collect, deliver and receive payment under instruments for the payment of money constituting or relating to Proceeds; (k) to prepare, adjust, execute, deliver and receive payment under insurance claims, and to collect and receive payment of and endorse any instrument in payment of loss or returned premiums or any other insurance refund or return, and to apply such amounts received by Schewe, at Schewe’s sole option, toward repayment of the Indebtedness or replacement of the Collateral; (1) after the occurrence and during the continuance of an Event of Default, to exercise all rights, powers and remedies which Debtor would have, but for this Agreement, with respect to all Collateral and Proceeds subject hereto; (m) at reasonable times to enter onto Debtor’s premises in inspecting the Collateral; (n) after the occurrence and during the continuance of an Event of Default, to make withdrawals from and to close deposit accounts or other accounts with any financial institution, wherever located, into which Proceeds may have been deposited, and to apply funds so withdrawn to payment of the Indebtedness; (o) to preserve or release the interest evidenced by chattel paper to which Schewe is entitled hereunder and to endorse and deliver evidences of title incidental thereto; and (p) to do all acts and things and execute all documents in the name of Debtor or otherwise, deemed by Schewe as necessary, proper and convenient in connection with the preservation, perfection or enforcement of his rights hereunder.

7. PAYMENT OF PREMIUMS, TAXES, CHARGES, LIENS AND ASSESSMENTS. Debtor agrees to pay, prior to delinquency, all insurance premiums, taxes, charges, liens and assessments against the Collateral and Proceeds, and upon the failure of Debtor to do so, Schewe at its option may pay any of them and shall be the sole judge of the legality or validity thereof and the amount necessary to discharge the same. Any such payments made by Schewe shall be obligations of Debtor to Schewe, due and payable immediately upon demand, together with interest at a rate of 10% per year, and shall be secured by the Collateral and Proceeds, subject to all terms and conditions of this Agreement.

8. EVENTS OF DEFAULT. The occurrence of any of the following shall constitute an "Event of Default” under this Agreement:  (a) any event defined as an Event of Default, under the Note, subject to any applicable grace or cure rights; (b) any representation or warranty made by Debtor herein shall prove to be incorrect in any material respect when made; or (c) Debtor shall fail to observe or perform any obligation or agreement contained herein and fail to cure any such default within thirty (30) days after written notice thereof from Schewe.

9. REMEDIES. Upon the occurrence of any Event of Default, Schewe shall have, and may exercise without demand, any and all rights, powers, privileges and remedies granted to a secured party upon default under the California Uniform Commercial Code or otherwise provided by law, including without limitation the right to contact all persons or entities obligated to Debtor on any Collateral or Proceeds and to instruct such persons or entities to deliver all Collateral and/or Proceeds directly to Schewe. All rights, powers, privileges and remedies of Schewe shall be cumulative. No delay, failure or discontinuance of Schewe in exercising any right, power, privilege or remedy hereunder shall affect or operate as a waiver of such right, power, privilege or remedy; nor shall any single or partial exercise of any such right, power, privilege or remedy preclude, waive or otherwise affect any other or further exercise thereof or the exercise of any other right, power, privilege or remedy. Any waiver, permit, consent or approval of any kind by Schewe of any default hereunder, or any such waiver of any provisions or conditions hereof, must be in writing and shall be effective only to the extent set forth in writing. It is agreed that public or private sales, for cash or on credit, to a wholesaler or retailer or investor, or user of property of the types subject to this Agreement, or public auction, are all commercially reasonable since differences in the sales prices generally realized in the different kinds of sales are ordinarily offset by the differences in the costs and credit risks of such sales. While an Event of Default exists:  (a) Debtor will deliver to Schewe from time to time, as requested by Schewe, current lists of all Collateral and Proceeds in its possession; (b) Debtor will not dispose of any of the Collateral or Proceeds (other than inventory sold to third parties in the ordinary course of business) except on terms approved by Schewe; (c) at Schewe’s request, Debtor will assemble and deliver all Collateral and Proceeds, and books and records pertaining thereto, to Schewe at a reasonably convenient place designated by Schewe; and (d) Schewe may, without notice to any Debtor, enter onto each Debtor’s premises and take possession of the Collateral. With respect to any sale by Schewe of any Collateral subject to this Agreement, Debtor hereby expressly grants to Schewe the right to sell such Collateral using any or all of Debtor’s trademarks, trade names, trade name rights and/or proprietary labels or marks.

10. DISPOSITION OF COLLATERAL AND PROCEEDS. Any proceeds of any disposition of any of the Collateral or Proceeds, or any part thereof, occurring after the occurrence of any Event of Default, may be applied by Schewe to the payment of expenses incurred by Schewe in connection with such disposition, including without limitation reasonable attorneys’ fees and costs, and the balance of such proceeds may be applied by Schewe toward the payment of the Indebtedness in such order of application as Schewe may from time to time elect.

11. NOTICES. All notices, requests and demands required under this Agreement must be in writing, addressed each party at the address set forth under the Loan Agreement or to such other address as either party may designate by written notice to the other party, and shall be deemed to have been given or made as follows:  (a) if personally delivered, upon delivery; (b) if sent by mail, upon the earlier of the date of receipt or three (3) days after deposit in the U.S. mail, first class and postage prepaid; and (c) if sent by email, upon receipt.

12. COSTS, EXPENSES AND ATTORNEYS’ FEES. Debtor shall pay to Schewe promptly upon demand (and in any event within 10 days of demand) the full amount of all payments, advances, charges, costs and expenses, including without limitation reasonable attorneys’ fees and costs, expended or incurred by Schewe in exercising any right, power, privilege or remedy conferred by this Agreement or in the enforcement thereof, whether incurred at the trial or appellate level, in an arbitration proceeding or otherwise, and including any of the foregoing incurred in connection with any bankruptcy proceeding (including without limitation, any adversary proceeding, contested matter or motion brought by Schewe or any other person or entity) relating to Debtor or in any way affecting any of the Collateral or Proceeds or Schewe’s ability to exercise any of its rights or remedies with respect thereto. All of the foregoing shall be paid by Debtor with interest from the date of demand until paid in full at the rate of 10.0% per year.

13. SUCCESSORS. This Agreement shall be binding upon and inure to the benefit of the heirs, executors, administrators, legal representatives, successors and assigns of the parties.

14. AMENDMENT. This Agreement may be amended or modified only in a writing signed by Schewe and Debtor.

15. SEVERABILITY OF PROVISIONS. If any provision of this Agreement is held to be prohibited by or invalid under applicable law, such provision shall be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or any remaining provisions of this Agreement.

16.  GOVERNING LAW AND CONSENT TO JURISDICTION. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA. DEBTOR HEREBY CONSENTS, AND SUBMITS, TO THE PERSONAL JURISDICTION OF ANY STATE OR FEDERAL COURT LOCATED IN THE STATE OF CALIFORNIA IN CONNECTION WITH ANY LEGAL ACTION RELATING TO THIS AGREEMENT AND WAIVES ANY RIGHT IT MIGHT HAVE IN CONNECTION WITH SUCH ACTION TO ASSERT THE DOCTRINE OF FORUM NON CONVENIENS OR TO OBJECT TO VENUE.

Debtor warrants that its chief executive office is located at the following address:

VIASPACE, Inc.

382 N. Lemon Ave., Suite 364

Walnut, CA 91789

Telephone: 626-768-3360

Facsimile: 888-965-9407

Debtor warrants that the Collateral (except goods in transit) is located or domiciled at the address set forth for above or at one of the addresses set forth below:  

IN WITNESS WHEREOF, this Agreement has been duly executed as of January 25, 2016.

[Printed Name and Title]SCHEDULE 1

EXISTING LIENS

Ex. 10.3

NEITHER THE ISSUANCE AND SALE OF THIS NOTE NOR THE SECURITIES INTO WHICH THIS NOTE IS CONVERTIBLE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933 OR (B) AN OPINION OF COUNSEL, IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144, RULE 144A OR OTHER EXEMPTION UNDER SAID ACT.

THE TRANSFER OF THE SECURITIES REPRESENTED HEREBY IS PROHIBITED EXCEPT IN ACCORDANCE WITH THE SECURITIES ACT OF 1933, OR PURSUANT TO AN AVAILABLE EXEMPTION FROM REGISTRATION.

VIASPACE INC.

SENIOR SECURED CONVERTIBLE PROMISSORY NOTE

$            , 201      

FOR VALUE RECEIVED, VIASPACE INC., a Nevada corporation (“Company”), promises to pay to Kevin Schewe (“Holder”), or its registered assigns, in lawful money of the United States of America the principal sum of        Dollars ($     ), or such other amount as shall equal the outstanding principal amount hereof, together with interest from the date of this Note on the unpaid principal balance at a rate equal to eight percent (8.0%) per annum, computed on the basis of the actual number of days elapsed and a year of 365 days. Unless converted into Common Stock of Company as set forth in Section 3 and/or Section 8 below, all unpaid principal, together with any then unpaid and accrued interest, shall be due and payable on the earlier of (i)       , 201       (the “Maturity Date”), (ii) upon prepayment of all amounts due and payable under this Note in accordance with the terms hereof, or (iii) when, upon or after the occurrence of an Event of Default (as defined below), such amounts are declared due and payable by Holder or made automatically due and payable in accordance with the terms hereof. Immediately prior to the issuance of this Note by Company, Holder acknowledges that it has delivered to Company the sum of      Dollars ($     ) reflecting the principal amount under this Note.

This Note is one of a series of notes (the “Notes”) having like tenor and effect (except for variations necessary to express the name of the holder, the principal amount of each of the Notes and the date on which each Note is funded) in an aggregate principal amount of up to $300,000 issued or to be issued by Company on or about the period from January 2016 to January 2017 (or such other period as agreed upon by the Company and the Holder) pursuant to the terms of a Loan Agreement, dated as of January 25, 2016, by and between Company and the Holder (or his designees) of the Notes (the “Loan Agreement”). The Notes shall rank equally without preference or priority of any kind over one another, and all payments on account of principal and interest with respect to any of the Notes shall be applied ratably and proportionately on the outstanding Notes on the basis of the principal amount of the outstanding indebtedness represented thereby.

The following is a statement of the rights of Holder and the conditions to which this Note is subject, and to which Company by issuance of this Note, and Holder by the acceptance of this Note, agree:

1. Definitions. As used in this Note, the following capitalized terms have the following meanings:

(a) “Common Stock” shall mean the Company’s Common Stock, par value $0.0001.

(b) “Collateral” has the meaning given in Section 4 hereof.

(c) “Company” includes the corporation initially executing this Note and any Person which shall succeed to or assume the obligations of Company under this Note.

(d) “Conversion Notice” has the meaning given in Section 8(e) hereof.

(e) “Conversion Period” shall mean the period from the date of the Note and ending on the Maturity Date.

(f) “Conversion Price” has the meaning given in Section 8(b) hereof

(g) “Event of Default” has the meaning given in Section 6 hereof.

(h) “Holder” shall mean the Person specified in the introductory paragraph of this Note or any Person who shall at the time be the registered holder of this Note. “Holders” shall mean the Persons collectively specified in the introductory paragraph of this Note and the other Notes or any Persons who shall at the time be the registered holders of this Note and the other Notes.

(i) “Majority Holders” shall mean Holders holding a majority of the aggregate principal amount of the Notes then outstanding.

(j) “Note” shall mean this Senior Secured Convertible Promissory Note.

(k) “Obligations” shall mean and include all loans, advances, debts, liabilities and obligations owed by Company to Holder of every kind and description, now existing or hereafter arising under or pursuant to the terms of this Note including, all interest, fees, charges, expenses, attorneys’ fees and costs and accountants’ fees and costs chargeable to and payable by Company hereunder.

(l) “Person” shall mean and include an individual, a partnership, a corporation (including a business trust), a joint stock company, a limited liability company, an unincorporated association, a joint venture or other entity or a governmental authority.

(m) “Prepayment Amount” has the meaning given in Section 3 hereof

(n) “Prepayment Notice” has the meaning given in Section 3 hereof.

(o) “Sale Transaction” shall mean a transaction or series of related transactions involving (i) the consolidation or merger of Company with another Person, (ii) a sale of all or substantially all of the assets of Company, (iii) a purchase, tender or exchange offer that is accepted by the holders of more than the 50% of the outstanding shares of capital stock of Company, (iv) the consummation of a stock purchase agreement or other business combination with another Person whereby such other Person acquires more than the 50% of the outstanding capital stock of Company.

(p) “Securities Act” has the meaning given in Section 5(b) hereof.

(q) “Loan Agreement” has the meaning in the second introductory paragraph of this Note.

(r) “Successor Entity” has the meaning given in Section 10 hereof.

Capitalized term not otherwise defined shall have the meaning set forth in the Loan Agreement.

2. Interest. Unless converted into Common Stock of Company as set forth in Section 8 below, or unless prepaid or converted as set forth in Section 3 below, accrued interest on this Note shall be payable on the Maturity Date.

3. Prepayment. During the Conversion Period, Company may, at any time and from time to time, prepay all or any portion of the principal due under this Note, together with accrued interest, without penalty. Company shall effect such prepayment by providing Holder twenty (20) days written notice prior to the date of such prepayment (such notice, a “Prepayment Notice”) indicating the amount of principal and accrued interest Company desires to prepay (the “Prepayment Amount”). Notwithstanding the foregoing, Holder shall have 10 days following receipt of such Prepayment Notice to notify Company in writing of its election to convert the Prepayment Amount into shares of Common Stock, in which case such Prepayment Amount shall be converted into shares of Common Stock in accordance with the conversion procedures set forth in Section 8(e) hereof (provided that, with respect to conversions effected pursuant to this Section 3, any references to the Conversion Amount in Section 8(e) shall refer to the Prepayment Amount). Should Holder elect to convert the Prepayment Amount into shares of Common Stock, the number of shares of Common Stock into which such Prepayment Amount will be converted shall be determined by dividing the Prepayment Amount by the then applicable Conversion Price.

4. Security Interest. As security for the payment and performance of the Obligations under this Note and the other Notes, Company hereby grants to the holder of this Note and of the other Notes a first lien security interest in all of Company’s right, title and interest in, to and under all of its personal property, wherever located and whether now existing or owned or hereafter acquired or arising, including all accounts, chattel paper, commercial tort claims, deposit accounts, documents, equipment (including all fixtures), general intangibles, intellectual property (including all patents and patent applications, all copyrights and applications for copyright, all state (including common law), federal and foreign trademarks, service marks and trade names, and applications for registration of such trademarks, service marks and trade names, and all trade secrets), instruments, inventory, investment property, letter-of-credit rights, money and all products, proceeds and supporting obligations of any and all of the foregoing (collectively, the “Collateral”). Notwithstanding the foregoing, the security interest granted herein shall not extend to any property, rights or licenses to the extent the granting of a security interest therein would be contrary to applicable law.

5. Representations and Warranties of Holder. Holder represents and warrants to Company as follows:

(a) Binding Obligation. Holder has full legal capacity, power and authority to execute and deliver this Note and to perform his obligations hereunder. This Note is a valid and binding obligation of Holder, enforceable in accordance with its terms, except as limited by bankruptcy, insolvency or other laws of general application relating to or affecting the enforcement of creditors’ rights generally and general principles of equity.

(b) Securities Law Compliance. Holder has been advised that this Note has not been registered under the Securities Act of 1933, as amended (the “Securities Act”), or any state securities laws and, therefore, cannot be resold unless they are registered under the Securities Act and applicable state securities laws or unless an exemption from such registration requirements is available. Holder is aware that Company is under no obligation to effect any such registration with respect to this Note, or the Common Stock issuable or issued pursuant to the conversion of this Note, or to file for or comply with any exemption from registration. Holder has not been formed solely for the purpose of making this investment and is purchasing this Note for its own account for investment, not as a nominee or agent, and not with a view to, or for resale in connection with, the distribution thereof. Holder has such knowledge and experience in financial and business matters that Holder is capable of evaluating the merits and risks of such investment, is able to incur a complete loss of such investment and is able to bear the economic risk of such investment for an indefinite period of time.

(c) Accredited Investor. Holder is an “accredited investor” within the meaning of SEC Rule 501 of Regulation D of the Securities Act, as presently in effect.

(d) Restricted Securities. Holder understands that this Note is a “restricted security” under the federal securities laws inasmuch as it is being acquired from Company in a transaction not involving a public offering and that under such laws and applicable regulations such Note may be resold without registration under the Securities Act only in certain limited circumstances. In the absence of an effective registration statement covering the Note or an available exemption from registration under the Securities Act, the Note must be held indefinitely. Holder represents that it is familiar with SEC Rule 144, and understands the resale limitations imposed thereby and by the Securities Act.

(e) Access to Information. Holder acknowledges that Company has given Holder access to the corporate records and accounts of Company and to all information in its possession relating to Company, has made its officers and representatives available for interview by Holder, and has furnished Holder with all documents and other information required for Holder to make an informed decision with respect to the purchase of this Note.

6. Events of Default. The occurrence of any of the following shall constitute an “Event of Default” under this Note:

(a) Failure to Pay. Company shall fail to pay (i) when due any principal or interest payment on the due date hereunder or (ii) any other payment required under the terms of this Note on the date due, and (in either case) such payment shall not have been made within twenty (20) days of Company’s receipt of Holder’s written notice to Company of such failure to pay;

(b) Failure to Perform. Company fails to perform any obligation under this Note and does not cure that failure within twenty (20) days of Company’s receipt of Holder’s written notice to Company of such failure to perform; or

(c) Voluntary Bankruptcy or Insolvency Proceedings. Company shall (i) apply for or consent to the appointment of a receiver, trustee, liquidator or custodian of itself or of all or a substantial part of its property, (ii) be unable, or admit in writing its inability, to pay its debts generally as they mature, (iii) make a general assignment for the benefit of its or any of its creditors, (iv) be dissolved or liquidated, (v) become insolvent (as such term may be defined or interpreted under any applicable statute), (vi) commence a voluntary case or other proceeding seeking liquidation, reorganization or other relief with respect to itself or its debts under any bankruptcy, insolvency or other similar law now or hereafter in effect or consent to any such relief or to the appointment of or taking possession of its property by any official in an involuntary case or other proceeding commenced against it, or (vii) take any action for the purpose of effecting any of the foregoing; or

(d) Involuntary Bankruptcy or Insolvency Proceedings. Proceedings for the appointment of a receiver, trustee, liquidator or custodian of Company or of all or a substantial part of the property thereof, or an involuntary case or other proceedings seeking liquidation, reorganization or other relief with respect to Company or the debts thereof under any bankruptcy, insolvency or other similar law now or hereafter in effect shall be commenced and an order for relief entered or such proceeding shall not be dismissed or discharged within thirty (30) days of commencement.

7. Rights of Holder upon Default. Upon the occurrence or existence of any Event of Default (other than an Event of Default referred to in Sections 6(c) and 6(d)) and at any time thereafter during the continuance of such Event of Default, the Majority Holders may, by written notice to Company, declare all outstanding Obligations payable by Company under the Notes to be immediately due and payable without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived. Upon the occurrence or existence of any Event of Default described in Sections 6(c) and 6(d), immediately and without notice, all outstanding Obligations payable by Company under the Notes shall automatically become immediately due and payable, without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived. In addition to the foregoing remedies, upon the occurrence or existence of any Event of Default, Holder may exercise any other right power or remedy permitted to him by law, either by suit in equity or by action at law, or both.

8. Conversion.

(a) Conversion. Holder shall have the right to convert, at any time during the Conversion Period, all or any portion of the principal amount, together with any unpaid and accrued interest, then outstanding under this Note into fully paid and non-assessable shares of Common Stock at a conversion price per share equal to the Conversion Price (as defined below). The number of shares of Common Stock into which such principal and interest then outstanding under this Note will be converted shall be determined by dividing the amount of principal, together with all unpaid and accrued interest, then outstanding under this Note to be converted (the “Conversion Amount”) by the Conversion Price.

(b) Conversion Price. Subject to Section 8(c), the “Conversion Price” shall be equal to twenty per cent (20%) of the Average Closing Price as reported by the principal trading exchange on which the Company’s Common Stock is traded for the twenty (20) trading days preceding the date of the Note.

(c) Adjustments to Conversion Price. The Conversion Price shall be subject to proportional adjustments for stock splits, stock dividends, combinations, consolidations, reclassifications and the like.

(d) Conversion Procedure. Before Holder shall be entitled to convert the Conversion Amount then outstanding under this Note into shares of Common Stock, Holder shall surrender this Note at the office of this Company, and shall give written notice (a form of which is attached to this Note, the “Conversion Notice”) to Company at its principal corporate office, of the election to convert the same and shall state therein the total Conversion Amount. Company shall not be obligated to issue certificates evidencing the shares of Common Stock issuable upon such conversion unless (i) Holder executes and delivers to Company the Conversion Notice for the converted shares and (ii) this Note is delivered to Company. Company shall, as soon as practicable after such delivery, issue and deliver certificates (bearing such legends as are required by applicable state and federal securities laws in the opinion of counsel to Company and required by this Note and the Loan Agreement), representing the number of fully paid and non-assessable shares of the Common Stock into which the Conversion Amount will be converted in accordance with the provisions herein, and a new promissory note having like tenor as this Note for the principal amount and interest then outstanding under this Note that are not being so converted. Any conversion pursuant to this Section 8 shall be deemed to have been made immediately prior to the close of business on the date of Company’s receipt of the Conversion Notice, so that the rights of Holder under this Note to the extent of the Conversion Amount shall cease at such time and Holder shall be treated for all purposes as having become the record holder of such shares of Common Stock at such time.

(e) Fractional Shares; Effect of Conversion. No fractional shares shall be issued upon conversion of this Note. In lieu of Company issuing any fractional shares to Holder upon the conversion of this Note, Company shall pay to Holder an amount equal to the product obtained by multiplying the Conversion Price by the fraction of a share not issued pursuant to the previous sentence. Upon conversion of this Note in full and the payment of the amounts specified in this Section 9(f), Company shall be forever released from all its obligations and liabilities under this Note.

(f) Reservation of Stock Issuable Upon Conversion. Company shall at all times reserve and keep available out of its authorized but unissued shares of Common Stock solely for the purpose of effecting the conversion of this Note such number of its shares of Common Stock as shall from time to time be sufficient to effect the conversion of this Note.

9. Reserved

10. Effect of Sale Transaction. Upon the occurrence of any Sale Transaction, the Successor Entity (as defined below) shall succeed to, and be substituted for the Company (so that from and after the date of such Sale Transaction, the provisions of this Note referring to the “Company” shall refer instead to the Successor Entity), and may exercise every right and power of the Company and shall assume all of the obligations of the Company under this Note with the same effect as if such Successor Entity had been named as the Company herein. Upon consummation of the Sale Transaction, the Successor Entity shall deliver to the Holder confirmation that there shall be issued upon conversion of this Note at any time after the consummation of the Sale Transaction, in lieu of the shares of the Common Stock purchasable upon the conversion of the Notes prior to such Sale Transaction, such shares of common stock (or other securities, cash, assets or other property) of the Successor Entity. The provisions of this Section shall apply similarly and equally to successive Sale Transactions and shall be applied without regard to any limitations on the conversion of this Note. As used in this Section 10, “Successor Entity” means the Person, which may be the Company, formed by, resulting from or surviving any Sale Transaction, or the parent entity of such Person, as applicable.

11. Successors and Assigns. Subject to the restrictions on transfer described in Sections 12 and 13 below, the rights and obligations of Company and Holder of this Note shall be binding upon and benefit the successors, assigns, heirs, administrators and transferees of the parties.

12. Waiver and Amendment. Any term of this Note may be amended or waived only with the written consent of Company and the Majority Holders; provided, however, that any such amendment or modification which by its terms would not apply equally to all holders of the Notes shall not be applicable to any holder whose rights under the Notes would be adversely affected by such amendment or modification in a different manner than other holders thereof without such adversely affected holder’s written consent.

13. Transfer of this Note or Securities Issuable on Conversion Hereof. With respect to any offer, sale or other disposition of this Note or securities into which such Note may be converted, Holder will give written notice to Company prior thereto, describing briefly the manner thereof, together with a written opinion of Holder’s counsel, or other evidence if reasonably satisfactory to Company, to the effect that such offer, sale or other distribution may be effected without registration or qualification (under any federal or state law then in effect). Upon receiving such written notice and reasonably satisfactory opinion, if so requested, or other evidence, Company, as promptly as practicable, shall notify Holder that Holder may sell or otherwise dispose of this Note or such securities, all in accordance with the terms of the notice delivered to Company. If a determination has been made pursuant to this Section 12 that the opinion of counsel for Holder, or other evidence, is not reasonably satisfactory to Company, Company shall so notify Holder promptly after such determination has been made. Each Note thus transferred and each certificate representing the securities thus transferred shall bear a legend as to the applicable restrictions on transferability in order to ensure compliance with the Securities Act, unless in the opinion of counsel for Company such legend is not required in order to ensure compliance with the Securities Act. Company may issue stop transfer instructions to its transfer agent in connection with such restrictions. Subject to the foregoing, transfers of this Note shall be registered upon registration books maintained for such purpose by or on behalf of Company. Prior to presentation of this Note for registration of transfer, Company shall treat the registered Holder hereof as the owner and Holder of this Note for the purpose of receiving all payments of principal and interest hereon and for all other purposes whatsoever, whether or not this Note shall be overdue and Company shall not be affected by notice to the contrary.

14. Notices. Any notices, consents, waivers or other communications required or permitted to be given under the terms of this Agreement must be in writing and will be deemed to have been delivered: (i) upon receipt, when delivered personally; (ii) upon receipt, when sent by facsimile (provided confirmation of transmission is mechanically or electronically generated and kept on file by the sending party); or (iii) one business day after deposit with an overnight courier service, in each case properly addressed to the party to receive the same. The addresses and facsimile numbers for such communications shall be to the respective addresses or facsimile numbers of the parties as set forth in the Loan Agreement, or at such other address or facsimile number as such parties shall have furnished in writing.

15. Usury. In the event any interest is paid on this Note which is deemed to be in excess of the then legal maximum rate, then that portion of the interest payment representing an amount in excess of the then legal maximum rate shall be deemed a payment of principal and applied against the principal of this Note.

16. Waivers. Company hereby waives notice of default, presentment or demand for payment, protest or notice of nonpayment or dishonor and all other notices or demands relative to this instrument.

17. Governing Law and Forum. This Note and all actions arising out of or in connection with this Note shall be governed by and construed in accordance with the laws of the State of Colorado, United States of America, without regard to the conflicts of law provisions of the State of Colorado, or of any other state. All disputes or controversies relating to or arising from this Note shall be adjudicated in the state and federal courts located in the state of Colorado. EACH OF THE PARTIES HERETO WAIVES ANY RIGHT TO REQUEST A TRIAL BY JURY IN ANY LITIGATION WITH RESPECT TO THIS NOTE AND REPRESENTS THAT COUNSEL HAS BEEN CONSULTED SPECIFICALLY AS TO THIS WAIVER. The Convention on Contracts for the International Sale of Goods shall not apply to this Note.

[Remainder of Page Intentionally Left Blank]

1

IN WITNESS WHEREOF, Company has caused this Note to be issued as of the date first written above and Holder agrees to the terms and conditions of this Note.

VIASPACE INC.

By:
Name:
Its:

KEVIN SCHEWE

NOTICE OF CONVERSION

(To be executed by the Registered Holder in order to convert the Note)

The undersigned hereby elects to convert $      of the principal and $      of the interest due on the Note issued by VIASPACE Inc. on [ ] into Shares of Common Stock of VIASPACE Inc. (the “Borrower”) according to the conditions set forth in such Note, as of the date written below.

Date of Conversion:      

Conversion Price:      

Shares To Be Delivered:      

Signature:      

Print Name:      

Address:      

2

Ex. 10.4

NEITHER THE ISSUANCE AND SALE OF THIS NOTE NOR THE SECURITIES INTO WHICH THIS NOTE IS CONVERTIBLE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933 OR (B) AN OPINION OF COUNSEL, IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144, RULE 144A OR OTHER EXEMPTION UNDER SAID ACT.

THE TRANSFER OF THE SECURITIES REPRESENTED HEREBY IS PROHIBITED EXCEPT IN ACCORDANCE WITH THE SECURITIES ACT OF 1933, OR PURSUANT TO AN AVAILABLE EXEMPTION FROM REGISTRATION.

VIASPACE INC.

SENIOR SECURED CONVERTIBLE PROMISSORY NOTE

$15,000.00 January 27, 2016

FOR VALUE RECEIVED, VIASPACE INC., a Nevada corporation (“Company”), promises to pay to Kevin Schewe (“Holder”), or its registered assigns, in lawful money of the United States of America the principal sum of FIFTEEN THOUSAND Dollars ($15,000.00), or such other amount as shall equal the outstanding principal amount hereof, together with interest from the date of this Note on the unpaid principal balance at a rate equal to eight percent (8.0%) per annum, computed on the basis of the actual number of days elapsed and a year of 365 days. Unless converted into Common Stock of Company as set forth in Section 3 and/or Section 8 below, all unpaid principal, together with any then unpaid and accrued interest, shall be due and payable on the earlier of (i) January 27, 2017 (the “Maturity Date”), (ii) upon prepayment of all amounts due and payable under this Note in accordance with the terms hereof, or (iii) when, upon or after the occurrence of an Event of Default (as defined below), such amounts are declared due and payable by Holder or made automatically due and payable in accordance with the terms hereof. Immediately prior to the issuance of this Note by Company, Holder acknowledges that it has delivered to Company the sum of FIFTEEN THOUSAND Dollars ($15,000.00) reflecting the principal amount under this Note.

This Note is one of a series of notes (the “Notes”) having like tenor and effect (except for variations necessary to express the name of the holder, the principal amount of each of the Notes and the date on which each Note is funded) in an aggregate principal amount of up to $300,000 issued or to be issued by Company on or about the period from January 2016 to January 2017 (or such other period as agreed upon by the Company and the Holder) pursuant to the terms of a Loan Agreement, dated as of January 25, 2016, by and between Company and the Holder (or his designees) of the Notes (the “Loan Agreement”). The Notes shall rank equally without preference or priority of any kind over one another, and all payments on account of principal and interest with respect to any of the Notes shall be applied ratably and proportionately on the outstanding Notes on the basis of the principal amount of the outstanding indebtedness represented thereby.

The following is a statement of the rights of Holder and the conditions to which this Note is subject, and to which Company by issuance of this Note, and Holder by the acceptance of this Note, agree:

1. Definitions. As used in this Note, the following capitalized terms have the following meanings:

(a) “Common Stock” shall mean the Company’s Common Stock, par value $0.0001.

(b) “Collateral” has the meaning given in Section 4 hereof.

(c) “Company” includes the corporation initially executing this Note and any Person which shall succeed to or assume the obligations of Company under this Note.

(d) “Conversion Notice” has the meaning given in Section 8(e) hereof.

(e) “Conversion Period” shall mean the period from the date of the Note and ending on the Maturity Date.

(f) “Conversion Price” has the meaning given in Section 8(b) hereof

(g) “Event of Default” has the meaning given in Section 6 hereof.

(h) “Holder” shall mean the Person specified in the introductory paragraph of this Note or any Person who shall at the time be the registered holder of this Note. “Holders” shall mean the Persons collectively specified in the introductory paragraph of this Note and the other Notes or any Persons who shall at the time be the registered holders of this Note and the other Notes.

(i) “Majority Holders” shall mean Holders holding a majority of the aggregate principal amount of the Notes then outstanding.

(j) “Note” shall mean this Senior Secured Convertible Promissory Note.

(k) “Obligations” shall mean and include all loans, advances, debts, liabilities and obligations owed by Company to Holder of every kind and description, now existing or hereafter arising under or pursuant to the terms of this Note including, all interest, fees, charges, expenses, attorneys’ fees and costs and accountants’ fees and costs chargeable to and payable by Company hereunder.

(l) “Person” shall mean and include an individual, a partnership, a corporation (including a business trust), a joint stock company, a limited liability company, an unincorporated association, a joint venture or other entity or a governmental authority.

(m) “Prepayment Amount” has the meaning given in Section 3 hereof

(n) “Prepayment Notice” has the meaning given in Section 3 hereof.

(o) “Sale Transaction” shall mean a transaction or series of related transactions involving (i) the consolidation or merger of Company with another Person, (ii) a sale of all or substantially all of the assets of Company, (iii) a purchase, tender or exchange offer that is accepted by the holders of more than the 50% of the outstanding shares of capital stock of Company, (iv) the consummation of a stock purchase agreement or other business combination with another Person whereby such other Person acquires more than the 50% of the outstanding capital stock of Company.

(p) “Securities Act” has the meaning given in Section 5(b) hereof.

(q) “Loan Agreement” has the meaning in the second introductory paragraph of this Note.

(r) “Successor Entity” has the meaning given in Section 10 hereof.

Capitalized term not otherwise defined shall have the meaning set forth in the Loan Agreement.

2. Interest. Unless converted into Common Stock of Company as set forth in Section 8 below, or unless prepaid or converted as set forth in Section 3 below, accrued interest on this Note shall be payable on the Maturity Date.

3. Prepayment. During the Conversion Period, Company may, at any time and from time to time, prepay all or any portion of the principal due under this Note, together with accrued interest, without penalty. Company shall effect such prepayment by providing Holder twenty (20) days written notice prior to the date of such prepayment (such notice, a “Prepayment Notice”) indicating the amount of principal and accrued interest Company desires to prepay (the “Prepayment Amount”). Notwithstanding the foregoing, Holder shall have 10 days following receipt of such Prepayment Notice to notify Company in writing of its election to convert the Prepayment Amount into shares of Common Stock, in which case such Prepayment Amount shall be converted into shares of Common Stock in accordance with the conversion procedures set forth in Section 8(e) hereof (provided that, with respect to conversions effected pursuant to this Section 3, any references to the Conversion Amount in Section 8(e) shall refer to the Prepayment Amount). Should Holder elect to convert the Prepayment Amount into shares of Common Stock, the number of shares of Common Stock into which such Prepayment Amount will be converted shall be determined by dividing the Prepayment Amount by the then applicable Conversion Price.

4. Security Interest. As security for the payment and performance of the Obligations under this Note and the other Notes, Company hereby grants to the holder of this Note and of the other Notes a first lien security interest in all of Company’s right, title and interest in, to and under all of its personal property, wherever located and whether now existing or owned or hereafter acquired or arising, including all accounts, chattel paper, commercial tort claims, deposit accounts, documents, equipment (including all fixtures), general intangibles, intellectual property (including all patents and patent applications, all copyrights and applications for copyright, all state (including common law), federal and foreign trademarks, service marks and trade names, and applications for registration of such trademarks, service marks and trade names, and all trade secrets), instruments, inventory, investment property, letter-of-credit rights, money and all products, proceeds and supporting obligations of any and all of the foregoing (collectively, the “Collateral”). Notwithstanding the foregoing, the security interest granted herein shall not extend to any property, rights or licenses to the extent the granting of a security interest therein would be contrary to applicable law.

5. Representations and Warranties of Holder. Holder represents and warrants to Company as follows:

(a) Binding Obligation. Holder has full legal capacity, power and authority to execute and deliver this Note and to perform his obligations hereunder. This Note is a valid and binding obligation of Holder, enforceable in accordance with its terms, except as limited by bankruptcy, insolvency or other laws of general application relating to or affecting the enforcement of creditors’ rights generally and general principles of equity.

(b) Securities Law Compliance. Holder has been advised that this Note has not been registered under the Securities Act of 1933, as amended (the “Securities Act”), or any state securities laws and, therefore, cannot be resold unless they are registered under the Securities Act and applicable state securities laws or unless an exemption from such registration requirements is available. Holder is aware that Company is under no obligation to effect any such registration with respect to this Note, or the Common Stock issuable or issued pursuant to the conversion of this Note, or to file for or comply with any exemption from registration. Holder has not been formed solely for the purpose of making this investment and is purchasing this Note for its own account for investment, not as a nominee or agent, and not with a view to, or for resale in connection with, the distribution thereof. Holder has such knowledge and experience in financial and business matters that Holder is capable of evaluating the merits and risks of such investment, is able to incur a complete loss of such investment and is able to bear the economic risk of such investment for an indefinite period of time.

(c) Accredited Investor. Holder is an “accredited investor” within the meaning of SEC Rule 501 of Regulation D of the Securities Act, as presently in effect.

(d) Restricted Securities. Holder understands that this Note is a “restricted security” under the federal securities laws inasmuch as it is being acquired from Company in a transaction not involving a public offering and that under such laws and applicable regulations such Note may be resold without registration under the Securities Act only in certain limited circumstances. In the absence of an effective registration statement covering the Note or an available exemption from registration under the Securities Act, the Note must be held indefinitely. Holder represents that it is familiar with SEC Rule 144, and understands the resale limitations imposed thereby and by the Securities Act.

(e) Access to Information. Holder acknowledges that Company has given Holder access to the corporate records and accounts of Company and to all information in its possession relating to Company, has made its officers and representatives available for interview by Holder, and has furnished Holder with all documents and other information required for Holder to make an informed decision with respect to the purchase of this Note.

6. Events of Default. The occurrence of any of the following shall constitute an “Event of Default” under this Note:

(a) Failure to Pay. Company shall fail to pay (i) when due any principal or interest payment on the due date hereunder or (ii) any other payment required under the terms of this Note on the date due, and (in either case) such payment shall not have been made within twenty (20) days of Company’s receipt of Holder’s written notice to Company of such failure to pay;

(b) Failure to Perform. Company fails to perform any obligation under this Note and does not cure that failure within twenty (20) days of Company’s receipt of Holder’s written notice to Company of such failure to perform; or

(c) Voluntary Bankruptcy or Insolvency Proceedings. Company shall (i) apply for or consent to the appointment of a receiver, trustee, liquidator or custodian of itself or of all or a substantial part of its property, (ii) be unable, or admit in writing its inability, to pay its debts generally as they mature, (iii) make a general assignment for the benefit of its or any of its creditors, (iv) be dissolved or liquidated, (v) become insolvent (as such term may be defined or interpreted under any applicable statute), (vi) commence a voluntary case or other proceeding seeking liquidation, reorganization or other relief with respect to itself or its debts under any bankruptcy, insolvency or other similar law now or hereafter in effect or consent to any such relief or to the appointment of or taking possession of its property by any official in an involuntary case or other proceeding commenced against it, or (vii) take any action for the purpose of effecting any of the foregoing; or

(d) Involuntary Bankruptcy or Insolvency Proceedings. Proceedings for the appointment of a receiver, trustee, liquidator or custodian of Company or of all or a substantial part of the property thereof, or an involuntary case or other proceedings seeking liquidation, reorganization or other relief with respect to Company or the debts thereof under any bankruptcy, insolvency or other similar law now or hereafter in effect shall be commenced and an order for relief entered or such proceeding shall not be dismissed or discharged within thirty (30) days of commencement.

7. Rights of Holder upon Default. Upon the occurrence or existence of any Event of Default (other than an Event of Default referred to in Sections 6(c) and 6(d)) and at any time thereafter during the continuance of such Event of Default, the Majority Holders may, by written notice to Company, declare all outstanding Obligations payable by Company under the Notes to be immediately due and payable without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived. Upon the occurrence or existence of any Event of Default described in Sections 6(c) and 6(d), immediately and without notice, all outstanding Obligations payable by Company under the Notes shall automatically become immediately due and payable, without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived. In addition to the foregoing remedies, upon the occurrence or existence of any Event of Default, Holder may exercise any other right power or remedy permitted to him by law, either by suit in equity or by action at law, or both.

8. Conversion.

(a) Conversion. Holder shall have the right to convert, at any time during the Conversion Period, all or any portion of the principal amount, together with any unpaid and accrued interest, then outstanding under this Note into fully paid and non-assessable shares of Common Stock at a conversion price per share equal to the Conversion Price (as defined below). The number of shares of Common Stock into which such principal and interest then outstanding under this Note will be converted shall be determined by dividing the amount of principal, together with all unpaid and accrued interest, then outstanding under this Note to be converted (the “Conversion Amount”) by the Conversion Price.

(b) Conversion Price. Subject to Section 8(c), the “Conversion Price” shall be equal to twenty per cent (20%) of the Average Closing Price as reported by the principal trading exchange on which the Company’s Common Stock is traded for the twenty (20) trading days preceding the date of the Note.

(c) Adjustments to Conversion Price. The Conversion Price shall be subject to proportional adjustments for stock splits, stock dividends, combinations, consolidations, reclassifications and the like.

(d) Conversion Procedure. Before Holder shall be entitled to convert the Conversion Amount then outstanding under this Note into shares of Common Stock, Holder shall surrender this Note at the office of this Company, and shall give written notice (a form of which is attached to this Note, the “Conversion Notice”) to Company at its principal corporate office, of the election to convert the same and shall state therein the total Conversion Amount. Company shall not be obligated to issue certificates evidencing the shares of Common Stock issuable upon such conversion unless (i) Holder executes and delivers to Company the Conversion Notice for the converted shares and (ii) this Note is delivered to Company. Company shall, as soon as practicable after such delivery, issue and deliver certificates (bearing such legends as are required by applicable state and federal securities laws in the opinion of counsel to Company and required by this Note and the Loan Agreement), representing the number of fully paid and non-assessable shares of the Common Stock into which the Conversion Amount will be converted in accordance with the provisions herein, and a new promissory note having like tenor as this Note for the principal amount and interest then outstanding under this Note that are not being so converted. Any conversion pursuant to this Section 8 shall be deemed to have been made immediately prior to the close of business on the date of Company’s receipt of the Conversion Notice, so that the rights of Holder under this Note to the extent of the Conversion Amount shall cease at such time and Holder shall be treated for all purposes as having become the record holder of such shares of Common Stock at such time.

(e) Fractional Shares; Effect of Conversion. No fractional shares shall be issued upon conversion of this Note. In lieu of Company issuing any fractional shares to Holder upon the conversion of this Note, Company shall pay to Holder an amount equal to the product obtained by multiplying the Conversion Price by the fraction of a share not issued pursuant to the previous sentence. Upon conversion of this Note in full and the payment of the amounts specified in this Section 9(f), Company shall be forever released from all its obligations and liabilities under this Note.

(f) Reservation of Stock Issuable Upon Conversion. Company shall at all times reserve and keep available out of its authorized but unissued shares of Common Stock solely for the purpose of effecting the conversion of this Note such number of its shares of Common Stock as shall from time to time be sufficient to effect the conversion of this Note.

9. Reserved

10. Effect of Sale Transaction. Upon the occurrence of any Sale Transaction, the Successor Entity (as defined below) shall succeed to, and be substituted for the Company (so that from and after the date of such Sale Transaction, the provisions of this Note referring to the “Company” shall refer instead to the Successor Entity), and may exercise every right and power of the Company and shall assume all of the obligations of the Company under this Note with the same effect as if such Successor Entity had been named as the Company herein. Upon consummation of the Sale Transaction, the Successor Entity shall deliver to the Holder confirmation that there shall be issued upon conversion of this Note at any time after the consummation of the Sale Transaction, in lieu of the shares of the Common Stock purchasable upon the conversion of the Notes prior to such Sale Transaction, such shares of common stock (or other securities, cash, assets or other property) of the Successor Entity. The provisions of this Section shall apply similarly and equally to successive Sale Transactions and shall be applied without regard to any limitations on the conversion of this Note. As used in this Section 10, “Successor Entity” means the Person, which may be the Company, formed by, resulting from or surviving any Sale Transaction, or the parent entity of such Person, as applicable.

11. Successors and Assigns. Subject to the restrictions on transfer described in Sections 12 and 13 below, the rights and obligations of Company and Holder of this Note shall be binding upon and benefit the successors, assigns, heirs, administrators and transferees of the parties.

12. Waiver and Amendment. Any term of this Note may be amended or waived only with the written consent of Company and the Majority Holders; provided, however, that any such amendment or modification which by its terms would not apply equally to all holders of the Notes shall not be applicable to any holder whose rights under the Notes would be adversely affected by such amendment or modification in a different manner than other holders thereof without such adversely affected holder’s written consent.

13. Transfer of this Note or Securities Issuable on Conversion Hereof. With respect to any offer, sale or other disposition of this Note or securities into which such Note may be converted, Holder will give written notice to Company prior thereto, describing briefly the manner thereof, together with a written opinion of Holder’s counsel, or other evidence if reasonably satisfactory to Company, to the effect that such offer, sale or other distribution may be effected without registration or qualification (under any federal or state law then in effect). Upon receiving such written notice and reasonably satisfactory opinion, if so requested, or other evidence, Company, as promptly as practicable, shall notify Holder that Holder may sell or otherwise dispose of this Note or such securities, all in accordance with the terms of the notice delivered to Company. If a determination has been made pursuant to this Section 12 that the opinion of counsel for Holder, or other evidence, is not reasonably satisfactory to Company, Company shall so notify Holder promptly after such determination has been made. Each Note thus transferred and each certificate representing the securities thus transferred shall bear a legend as to the applicable restrictions on transferability in order to ensure compliance with the Securities Act, unless in the opinion of counsel for Company such legend is not required in order to ensure compliance with the Securities Act. Company may issue stop transfer instructions to its transfer agent in connection with such restrictions. Subject to the foregoing, transfers of this Note shall be registered upon registration books maintained for such purpose by or on behalf of Company. Prior to presentation of this Note for registration of transfer, Company shall treat the registered Holder hereof as the owner and Holder of this Note for the purpose of receiving all payments of principal and interest hereon and for all other purposes whatsoever, whether or not this Note shall be overdue and Company shall not be affected by notice to the contrary.

14. Notices. Any notices, consents, waivers or other communications required or permitted to be given under the terms of this Agreement must be in writing and will be deemed to have been delivered: (i) upon receipt, when delivered personally; (ii) upon receipt, when sent by facsimile (provided confirmation of transmission is mechanically or electronically generated and kept on file by the sending party); or (iii) one business day after deposit with an overnight courier service, in each case properly addressed to the party to receive the same. The addresses and facsimile numbers for such communications shall be to the respective addresses or facsimile numbers of the parties as set forth in the Loan Agreement, or at such other address or facsimile number as such parties shall have furnished in writing.

15. Usury. In the event any interest is paid on this Note which is deemed to be in excess of the then legal maximum rate, then that portion of the interest payment representing an amount in excess of the then legal maximum rate shall be deemed a payment of principal and applied against the principal of this Note.

16. Waivers. Company hereby waives notice of default, presentment or demand for payment, protest or notice of nonpayment or dishonor and all other notices or demands relative to this instrument.

17. Governing Law and Forum. This Note and all actions arising out of or in connection with this Note shall be governed by and construed in accordance with the laws of the State of Colorado, United States of America, without regard to the conflicts of law provisions of the State of Colorado, or of any other state. All disputes or controversies relating to or arising from this Note shall be adjudicated in the state and federal courts located in the state of Colorado. EACH OF THE PARTIES HERETO WAIVES ANY RIGHT TO REQUEST A TRIAL BY JURY IN ANY LITIGATION WITH RESPECT TO THIS NOTE AND REPRESENTS THAT COUNSEL HAS BEEN CONSULTED SPECIFICALLY AS TO THIS WAIVER. The Convention on Contracts for the International Sale of Goods shall not apply to this Note.

[Remainder of Page Intentionally Left Blank]

1

IN WITNESS WHEREOF, Company has caused this Note to be issued as of the date first written above and Holder agrees to the terms and conditions of this Note.

VIASPACE INC.

By:/S/ HARIS BASIT
Name: HARIS BASIT
Its: CEO

KEVIN SCHEWE

/S/ KEVIN SCHEWE

NOTICE OF CONVERSION

(To be executed by the Registered Holder in order to convert the Note)

The undersigned hereby elects to convert $15,000.00 of the principal and $0 of the interest due on the Note issued by VIASPACE Inc. on January 27, 2016 into Shares of Common Stock of VIASPACE Inc. (the “Borrower”) according to the conditions set forth in such Note, as of the date written below.

Date of Conversion:       January 27, 2016      

Conversion Price:      $0.0004      

Shares To Be Delivered:      37,500,000      

Signature:      /S/ KEVIN L. SCHEWE—

Print Name:       Kevin L. Schewe—

Address:      400 Indiana St., Suite 220, Golden, CO 80401      

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Ex. 10.5

January 28, 2016

Haris,

I just wanted to confirm, as discussed, Amaanco has terminated its consulting agreement with Viaspace under clause 3 of the consulting agreement as of January 24, 2016.

With the termination of the consulting agreement between Amaanco and Viaspace, Amaanco no longer holds a seat on Viaspace’s board. Therefore, as Amaanco’s appointee, I have also tendered my resignation from the board effective January 24th, 2016.

Regards,

Khurram Irshad
Amaanco
11 & 12 Shaheen Towers
Sahara-e-Faisal
Karachi 75400
Pakistan

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