Document:

Exhibit 10.2

 

 

SECURED PROMISSORY NOTE

 

	U.S. $180,000.00	December 31, 2015

 

FOR VALUE RECEIVED,
Cabinet Grow, Inc., a Nevada corporation (“Borrower”), promises
to pay in lawful money of the United States of America to the order of Tonaquint, Inc.,
a Utah corporation, or its successors or assigns (“Lender”), the principal sum of $180,000.00, together with
all other amounts due under this Secured Promissory Note (this “Note”). This Note is issued pursuant to that
certain Membership Interest Purchase Agreement of even date herewith between Borrower and Lender (the “Purchase Agreement”).

1. 
PAYMENT. Borrower shall pay to Lender the entire outstanding balance of this Note on or before the date that is six
(6) months from the date hereof. Borrower will make all payments of sums due hereunder via wire transfer of immediately available
funds to such account as designated by Lender, or at such other place as Lender may designate in writing. Unless otherwise agreed
or required by applicable law, payments will be applied first to any unpaid collection costs and late charges, then to accrued
interest and finally to principal.

2. 
INTEREST. Interest shall accrue on the unpaid principal balance of this Note at the rate of six percent (6%) per
annum, simple interest, until the outstanding balance of this Note has been paid in full; provided, however, that upon the occurrence
of an Event of Default (as defined below), the outstanding balance of this Note shall bear interest at the lesser of the rate of
eighteen percent (18%) per annum or the maximum rate permitted by applicable law, compounding daily and calculated on the basis
of a 360-day year, from the date the applicable Event of Default occurred until paid.

3. 
PREPAYMENT. Borrower may pay without penalty all or a portion of the amount owed earlier than it is due. Early payments
of less than all principal, fees and interest outstanding will not, unless agreed to by Lender in writing, relieve Borrower of
any of Borrower’s obligations hereunder.

4. 
SECURITY. This Note is secured by that certain Membership Interest Pledge Agreement of even date herewith (the “Pledge
Agreement”) executed by Borrower in favor of Lender with respect to all of Borrower’s outstanding equity interest
in Quasar, LLC, a Utah limited liability company, as more specifically set forth in the Pledge Agreement, all the terms and conditions
of which are hereby incorporated into and made a part of this Note. This Note is also secured by a first position Deed of Trust,
Security Agreement and Financing Statement (the “Trust Deed”) of even date herewith in favor of Lender encumbering
a certain parcel of real property located in Midland County, Texas, as more specifically set forth in the Trust Deed, all the terms
and conditions of which are hereby incorporated and made a part of this Note.

5. 
NON-RECOURSE OBLIGATION. Notwithstanding the foregoing or anything to the contrary herein or in the Pledge Agreement
or the Trust Deed, this Note shall be a non-recourse obligation of Borrower, such that following any foreclosure of the collateral
pursuant to the Pledge Agreement or the Trust Deed, Borrower shall not be liable to Lender for any deficiency.

6. 
EVENT OF DEFAULT. The occurrence and continuance of any of the following shall constitute an “Event of Default”
under this Note:

6.1. 
Failure to Pay. Borrower shall fail to pay when due, whether at stated maturity, upon acceleration or otherwise,
any principal or interest payment, or any other payment required under the terms of this Note on the date due.

6.2. 
Breaches of Covenants. Borrower or any other person or entity fails to comply with or to perform when due any other
term, obligation, covenant, or condition contained in this Note or in any instrument given to secure the payment of the obligations
evidenced by this Note, the Purchase Agreement, the Pledge Agreement, the Trust Deed, or any agreement entered into in connection
with the Purchase Agreement (the “Loan Documents”)

6.3. 
Representations and Warranties. Any representation or warranty made by Borrower to Lender in the Loan Documents,
or any related agreement shall be false, incorrect, incomplete or misleading in any material respect when made or furnished.

6.4. 
Voluntary Bankruptcy or Insolvency Proceedings. Borrower 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, or (v) 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.

6.5. 
Involuntary Bankruptcy or Insolvency Proceedings. Proceedings for the appointment of a receiver, trustee, liquidator,
or custodian of Borrower or of all or a substantial part of its property, or an involuntary case or other proceedings seeking liquidation,
reorganization, or other relief with respect to Borrower or its debts 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 sixty (60) days of commencement.

6.6. 
Government Action. If any governmental or regulatory authority takes or institutes any action that will materially
affect Borrower’s financial condition, operations or ability to pay or perform Borrower’s obligations under this Note.

6.7. 
Judgment. A judgment or judgments for the payment of money in excess of the sum of $100,000.00 in the aggregate shall
be rendered against Borrower and either (i) the judgment creditor executes on such judgment or (ii) such judgment remains unpaid
or undischarged for more than sixty (60) days from the date of entry thereof or such longer period during which execution of such
judgment shall be stayed during an appeal from such judgment.

6.8. 
Attachment. Any execution or attachment shall be issued whereby any substantial part of the property of Borrower
shall be taken or attempted to be taken and the same shall not have been vacated or stayed within thirty (30) days after the issuance
thereof.

7. 
ACCELERATION; REMEDIES. At any time following the occurrence of an Event of Default (other than an Event of Default
referred to in Sections 6.4 and 6.5), Lender may, by written notice to Borrower, declare all unpaid principal, plus all accrued
interest and other amounts due hereunder to be immediately due and payable at the Mandatory Default Amount (as defined below) without
presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived, anything contained herein
to the contrary notwithstanding. Upon the occurrence or existence of any Event of Default described in Sections 6.4 and 6.5, immediately
and without notice, all outstanding unpaid principal, plus all accrued interest and other amounts due hereunder shall automatically
become immediately due and payable at the Mandatory Default Amount, without presentment, demand, protest or any other notice of
any kind, all of which are hereby expressly waived, anything contained herein to the contrary notwithstanding. In addition to the
foregoing remedies, upon the occurrence or existence of any Event of Default, Lender may exercise any other right, power or remedy
permitted to it by law, either by suit in equity or by action at law, or both. For purposes hereof, the term “Mandatory
Default Amount” means an amount equal to 125% of the outstanding balance of this Note as of the date the applicable Event
of Default occurred, plus all interest, fees, and charges that may accrue on such outstanding balance thereafter.

8. 
UNCONDITIONAL OBLIGATION; NO OFFSET. Borrower acknowledges that this Note is an unconditional, valid, binding and
enforceable obligation of Borrower not subject to offset, deduction or counterclaim of any kind. Borrower hereby waives any rights
of offset it now has or may have hereafter against Lender, its successors and assigns, and agrees to make all payments due hereunder
in accordance with the terms of this Note.

9. 
NO USURY. Notwithstanding any other provision contained in this Note or in any instrument given to evidence the obligations
evidenced hereby: (a) the rates of interest and charges provided for herein and therein shall in no event exceed the rates and
charges which result in interest being charged at a rate equaling the maximum allowed by law; and (b) if, for any reason whatsoever,
Lender ever receives as interest in connection with the transaction of which this Note is a part an amount which would result in
interest being charged at a rate exceeding the maximum allowed by law, such amount or portion thereof as would otherwise be excessive
interest shall automatically be applied toward reduction of the unpaid principal balance then outstanding hereunder and not toward
payment of interest.

10.  
ATTORNEYS’ FEES. If this Note is placed in the hands of an attorney for collection or enforcement prior to
commencing arbitration or legal proceedings, or is collected or enforced through any arbitration or legal proceeding, or Lender
otherwise takes action to collect amounts due under this Note or to enforce the provisions of this Note, then Borrower shall pay
the costs incurred by Lender for such collection, enforcement or action including, without limitation, attorneys’ fees and
disbursements.

11.  
GOVERNING LAW; VENUE. This Note shall be construed and enforced in accordance with the internal laws of the State
of Utah, irrespective of its choice of law principles. Borrower further agrees to subject
itself to the exclusive jurisdiction of the courts of the State of Utah and agrees to commence and maintain any lawsuit related
to this Note in such courts.

12.  
WAIVERS. Borrower hereby waives presentment, notice of nonpayment, notice of dishonor, protest, demand and diligence.

13.  
LOSS OR MUTILATION. On receipt by Borrower of evidence reasonably satisfactory to Borrower of the loss, theft, destruction
or mutilation of this Note and, in the case of any such loss, theft or destruction of this Note, on delivery of an indemnity agreement
reasonably satisfactory in form and amount to Borrower or, in the case of any such mutilation, on surrender and cancellation of
such Note, Borrower at its expense will execute and deliver, in lieu thereof, a new Note of like tenor.

14.  
AMENDMENT AND WAIVER. This Note and its terms and conditions may be amended, waived or modified only in writing by
Borrower and Lender.

15.  
SEVERABILITY. If any part of this Note is construed to be in violation of any law, such part shall be modified to
achieve the objective of the parties to the fullest extent permitted and the balance of this Note shall remain in full force and
effect.

16.  
ASSIGNMENTS. Borrower may not assign this Note without the prior written consent of Lender. This Note may be offered,
sold, assigned or transferred by Lender without the consent of Borrower.

17.  
FINAL NOTE. This Note, together with the other Loan Documents, contains the complete understanding and agreement
of Borrower and Lender and supersedes all prior representations, warranties, agreements, arrangements, understandings, and negotiations.
THIS NOTE, TOGETHER WITH THE OTHER LOAN DOCUMENTS, REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED
BY EVIDENCE OF ANY ALLEGED PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS
BETWEEN THE PARTIES.

18.  
Waiver of Jury Trial.
BORROWER IRREVOCABLY WAIVES ANY AND ALL RIGHTS IT MAY HAVE TO DEMAND THAT ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF
OR IN ANY WAY RELATED TO THIS NOTE OR THE RELATIONSHIPS OF THE PARTIES HERETO BE TRIED BY JURY. THIS WAIVER EXTENDS TO ANY AND
ALL RIGHTS TO DEMAND A TRIAL BY JURY ARISING UNDER COMMON LAW OR ANY APPLICABLE STATUTE, LAW, RULE OR REGULATION. FURTHER, BORROWER
ACKNOWLEDGES THAT IT KNOWINGLY AND VOLUNTARILY IS WAIVING SUCH PARTY’S RIGHT TO DEMAND TRIAL BY JURY.

19.  
TIME IS OF THE ESSENCE. Time is of the essence of this Note and each and every provision hereof in which time is
an element.

20.  
LIQUIDATED DAMAGES. Lender and Borrower agree that in the event Borrower fails to comply with any of the terms or
provisions of this Note, Lender’s damages would be uncertain and difficult (if not impossible) to accurately estimate because
of the parties’ inability to predict future interest rates, future share prices, future trading volumes and other relevant
factors. Accordingly, Lender and Borrower agree that any fees, balance adjustments, default interest or other charges assessed
under this Note are not penalties but instead are intended by the parties to be, and shall be deemed, liquidated damages.

21.  
MISCELLANEOUS. The rights and remedies of Lender are cumulative and not alternative. The makers, sureties, guarantors,
and endorsers of this Note severally waive presentment for payment, protest, demand, notice of dishonor, and notice of nonpayment,
and expressly agree that this Note, or any payment under this Note, may be extended without notice from time to time by Lender
without in any way affecting the liability of the parties. This Note shall be the joint and several obligation of all makers, sureties,
guarantors, and endorsers, and shall be binding upon their respective heirs, personal representatives, successors, and assigns.
In the event that any undersigned is a partnership, limited liability company, or corporation, each person executing this instrument
on behalf of the entity represents and warrants on behalf of the entity to Lender that this Note and each instrument signed in
the name of the entity and delivered to secure the obligations evidenced by this Note is in all respects binding upon the entity
as an act and obligation of the partnership, limited liability company, or corporation, as the case may be. The language used in
this Agreement will be deemed to be the language chosen by the parties to express their mutual intent and no rules of strict construction
will be applied against any party. The word “including” shall be non-exclusive and shall be interpreted as “including,
but not limited to.”

[Remainder of page
intentionally left blank]

    	 

    	 

    

IN WITNESS WHEREOF,
Borrower has caused this Note to be issued as of the date first set forth above.

	BORROWER:
	 
	Cabinet
Grow, Inc. 
	 	 
	By: 	/s/ Samuel May
	Name: 	Samuel May
	Title: 	Chief Executive OfficerExhibit 10.3

 

 

MEMBERSHIP
INTEREST PLEDGE AGREEMENT

This Membership
Interest Pledge Agreement (this “Agreement”) is entered into as of December 31, 2015, by and between
Cabinet Grow, Inc., a Nevada corporation (“Pledgor”), and Tonaquint, Inc., a Utah corporation (“Lender”).

A. 
Pledgor, as borrower thereunder, has issued to Lender that certain Secured Promissory Note of even date herewith in the
face amount of $180,000.00 (the “Note”).

B. 
Pledgor hereby desires to pledge pursuant to this Agreement its entire 100% membership interest (the “Pledged
Membership Interest”) in Quasar, LLC, a Utah limited liability company (the “Company”).

C. 
As borrower under the Note, Pledgor shall benefit from the loans and other financial accommodations granted to Pledgor pursuant
to the Note.

D. 
In order to induce Lender to make certain loans and other financial accommodations to Pledgor pursuant to the Note, Pledgor
has agreed to pledge the Pledged Membership Interest as security for performance and payment of all obligations under the Note.

NOW, THEREFORE, the parties hereto agree
as follows:

1. 
Defined Terms. All capitalized terms used and not otherwise defined herein shall have the meanings set forth in the
Note. The following terms shall have the following meanings:

“Article
8 Matter” shall mean any action, decision, determination or election by the Company or its members that the membership
interests or other equity interests in the Company, or any of them, be, or cease to be, a “security” as defined in
and governed by Article 8 of the UCC.

“Event
of Default” shall have the meaning set forth in the Note.

“Lien” means any mortgage, lien,
deed of trust, charge, pledge, security interest, or other encumbrance.

“Proceeds”
shall mean “proceeds,” as such term is defined in section 9-306(1) of the UCC and, in any event, shall include, without
limitation, (1) all dividends or distributions in cash or in kind made to Pledgor from time to time in respect of the Pledged
Membership Interest, (2) any and all proceeds of any insurance, indemnity, warranty or guaranty payable to Pledgor from time
to time with respect to any of the Pledged Membership Interest, (3) any and all payments (in any form whatsoever) made or
due and payable to Pledgor from time to time in connection with any requisition, confiscation, condemnation, seizure or forfeiture
of all or any part of the Pledged Membership Interest by any foreign or domestic government or any instrumentality or agency thereof
(a “Governmental Authority”) (or any person acting under color of any such Governmental Authority) and
(4) any and all other amounts from time to time paid or payable under or in connection with any of the Pledged Membership
Interest. In addition, the term Proceeds shall include, without limitation, all accounts, chattel paper, deposit accounts, instruments,
intellectual property, equipment, inventory, consumer goods, farm products, documents, general intangibles and other proceeds
which arise from the sale, lease, transfer, or other use or disposition of any kind of the Pledged Membership Interest and all
proceeds of any type (all of the foregoing shall have the meaning given them in the UCC except as otherwise defined herein).

“UCC”
shall mean the Uniform Commercial Code as the same may, from time to time, be in effect in the State of Utah; provided, however,
that in the event that, by reason of mandatory provisions of law, any or all of the attachment, perfection, priority or exercise
of remedies of Lender’s security interest in any of the Pledged Membership Interest is governed by the Uniform Commercial
Code as in effect in a jurisdiction other than the State of Utah, the term “UCC” shall mean the Uniform Commercial
Code as adopted and in effect in such other jurisdiction for purposes of the provisions hereof relating to such attachment, perfection,
priority or exercise of remedies and for purposes of definitions related to such provisions.

2. 
Grant of Security Interest.

a. 
Grant. As collateral security for the prompt and complete payment and performance when due (whether at stated maturity,
by acceleration or otherwise) of the Note, Pledgor hereby grants to Lender for its benefit a security interest in all of Pledgor’s
right, title and interest in, to and under the Pledged Membership Interest and the Proceeds with respect to the foregoing.

b. 
Certificates. All certificates and instruments, if any, representing or evidencing the Pledged Membership Interest
shall be delivered to and held by or on behalf of Lender pursuant hereto and shall be in suitable form for transfer by delivery,
or shall be accompanied by duly executed instruments of transfer or assignment in blank, all in form and substance satisfactory
to Lender. Upon the occurrence of an Event of Default, Lender shall have the right at any time, in its discretion and without further
notice to Pledgor, to transfer to or register in the name of Lender or any of its nominees any or all of the Pledged Membership
Interest.

3. 
Limitations on Lender’s Rights and Obligations. As long as Lender holds the Pledged Membership Interest as
pledgee, it is expressly agreed by Pledgor that, anything herein to the contrary notwithstanding, (a) Lender shall not have
any obligation or liability for the performance by Pledgor of its obligations as a member of the Company by reason of or arising
out of this Agreement or the granting to Lender of the security interest provided for herein or the receipt by Lender of any payment
relating hereto, and (b) Lender shall not be required or obligated in any manner to perform or fulfill any of the obligations of
Pledgor in its capacity as a member of the Company or to make any inquiry as to the nature or the sufficiency of any payment received
by Pledgor or the sufficiency of any performance by any other party of any obligation owed to Pledgor, as the case may be, or to
present or file any claim, or to take any action to collect or enforce any performance or the payment of any amounts which may
have been assigned to Lender or to which Lender may be entitled at any time or times.

4. 
Representations and Warranties. Pledgor hereby represents and warrants that:

a. 
Capitalization. The Pledged Membership Interest constitutes 100% of the Company’s outstanding equity, which
is Pledgor’s entire equity interest in the Company.

b. 
Title. Except for the security interest granted to Lender pursuant to this Agreement, Pledgor is the sole owner of
the Pledged Membership Interest having good and marketable title thereto, free and clear of any and all Liens and any transfer
restrictions affecting the Pledged Membership Interest other than any restrictions on transfer which may be imposed under the Company’s
operating agreement or other governing documents or applicable federal and state securities laws.

c. 
No Other Security Interests. No Lien exists or will exist on any part of the Pledged Membership Interest.

d. 
First Priority Perfected Security Interest. This Agreement is effective to create a valid and continuing first priority
Lien on and first priority perfected security interest in the Pledged Membership Interest in favor of Lender and prior to all other
Liens, and is enforceable as such as against creditors of and purchasers from Pledgor.

e. 
No Conflict. Neither Pledgor’s execution and delivery hereof nor its consummation of the transactions contemplated
hereby nor its compliance with any of the terms and provisions hereof (i) does or will contravene any existing requirement
of any Governmental Authority applicable to or binding on it or any of its properties, (ii) does or will contravene or result
in any breach of or constitute any default under, or result in the creation of any Lien (other than the Lien created hereby) upon
any of its property under any organizational document, indenture, mortgage, chattel mortgage, deed of trust, conditional sales
contract, bank loan or credit agreement, partnership agreement, limited liability company agreement or other agreement or instrument
to which it is a party or by which it or any of its properties be bound or affected, except as may have been validly waived in
connection with this Agreement.

f. 
Enforceability. Pledgor has duly executed and delivered this Agreement and this Agreement constitutes a legal, valid
and binding obligation of Pledgor enforceable against Pledgor in accordance with the terms hereof, except for the effect of applicable
laws regarding bankruptcy, insolvency, moratorium or fraudulent transfer or similar laws affecting the enforcement of creditors’
rights generally or by equitable principles relating to enforceability.

g. 
Litigation. There are no actions or proceedings pending or, to Pledgor’s knowledge, threatened, against or
affecting the Pledged Membership Interest before any court or administrative agency or arbitrator.

h. 
Legal Capacity. Pledgor has full power, authority and legal right and capacity to enter into and perform its obligations
under this Agreement and each other document contemplated hereby to which Pledgor is or will be a party and to consummate the transactions
contemplated hereby and thereby.

5. 
Covenants. Pledgor covenants and agrees with Lender that from and after the effectiveness of this Agreement until
the full payment and performance of Pledgor under the Note:

a. 
Further Assurances. At any time and from time to time, upon the written request of Lender, Pledgor will promptly
execute and deliver any and all such further instruments and documents as Lender may reasonably deem necessary to obtain the full
benefits and security of this Agreement, including, without limitation, executing and filing such financing or continuation statements,
securities account control agreements or amendments thereto, as may be necessary or desirable or that Lender may reasonably request
in order to perfect, preserve and enforce the security interest created hereby.

b. 
Limitation on Liens on Pledged Membership Interest. Pledgor will not create, permit or suffer to exist, and will
defend the Pledged Membership Interest against and take such other action as is necessary to remove, any Lien on the Pledged Membership
Interest, except the Lien granted pursuant to this Agreement, and will defend the right, title and interest of Lender in and to
Pledgor’s rights under the Pledged Membership Interest against the claims and demands of all third parties whomsoever. Pledgor
shall not cause or permit any amendment to any provision of any membership interest purchase agreements with the Company or the
operating agreement of the Company that would impair or otherwise negatively affect the Pledged Membership Interest or Lender without
the prior written consent of Lender.

c. 
Limitations on Disposition. Pledgor will not sell, assign, exchange, lease, transfer, pledge or otherwise dispose
of, or grant any option or other rights with respect to, the Pledged Membership Interest or any portion thereof.

d. 
Possession of Pledged Membership Interest Collateral. Pledgor shall deliver any and all additional certificates or
other indicia of ownership of the Pledged Membership Interest to Lender within three business days after receipt by Pledgor and,
upon Lender’s request, shall execute all pledge agreements, security agreements, stock powers, financing statements and all
other documents that Lender deems necessary or advisable to grant Lender a valid, perfected first priority security interest in
such Pledged Membership Interest.

e. 
No Debts. Pledgor shall not permit or cause the Company to guaranty or become obligated for the debts of any other
entity or person or hold itself out to be responsible for the debts of another entity or person, nor shall it cause or permit the
Company to incur any indebtedness whatsoever, whether secured or unsecured, without Lender’s prior written consent.

6. 
Voting Rights. Pledgor shall be permitted to exercise all voting rights with respect to the Pledged Membership Interest;
provided, however, that no vote shall be cast or other action taken which would impair the Pledged Membership Interest or which
would be inconsistent with or result in any violation of any provision of the Note, any other documents related to this transaction,
or any other provision of this Agreement.

7. 
Remedies.

a. 
If an Event of Default has occurred and is continuing (and has not been rescinded or waived pursuant to the Note), in addition
to, and not by way of limitation of, all rights and remedies granted in this Agreement and in any other instrument or agreement
securing, evidencing or relating to the Note or otherwise available at law or in equity, without any other notice to or demand
upon Pledgor, Lender shall have all rights and remedies of a secured party under the UCC. Without limiting the generality of the
foregoing, Lender, without demand of performance or other demand, presentment, protest, advertisement or notice of any kind (except
any notice required by applicable law referred to below) to or upon Pledgor or any third party (all and each of which demands,
defenses, advertisements and notices are to the fullest extent permitted by applicable law hereby waived), may in such circumstances
forthwith collect, receive, appropriate and realize upon the Pledged Membership Interest so pledged hereunder, or any part thereof,
and/or may forthwith sell, assign, give option or options to purchase or otherwise dispose of and deliver the Pledged Membership
Interest or any part thereof (or contract to do any of the foregoing), in one or more units at public or private sale or sales
upon such terms and conditions as it may deem advisable and at such prices as it may deem best, for cash or on credit or for future
delivery without assumption of any credit risk. Lender shall have the right upon any such public sale or sales, and, to the fullest
extent permitted by applicable law, upon any such private sale or sales, to purchase the whole or any part of the Pledged Membership
Interest so sold, free of any right or equity of redemption in Pledgor, which right or equity is hereby waived or released. Lender
shall apply any Proceeds from time to time held by it and the net proceeds of any such collection, recovery, receipt, appropriation,
realization or sale, after deducting all reasonable costs and expenses of every kind incurred therein or incidental to the care
or safekeeping of any of the Pledged Membership Interest or in any way relating to the Pledged Membership Interest or the rights
of Lender hereunder, including, without limitation, reasonable attorneys’ fees and disbursements, to the payment in whole
or in part of the Note, and only after such application and after the payment by Lender of any other amount required by any provision
of applicable law.

b. 
Pledgor recognizes that Lender may be unable to effect an unrestricted public sale of any or all of the Pledged Membership
Interest, by reason of certain prohibitions in the Securities Act of 1933, as amended, and applicable state securities laws or
otherwise, and may be compelled to resort to one or more public or private sales thereof to a restricted group of purchasers which
will be obligated to agree, among other things, to acquire such securities for their own account for investment and not with a
view to the distribution or resale thereof. Pledgor acknowledges and agrees that any such private sale or restricted public sale
may result in prices and other terms less favorable to Lender than if such sale were an unrestricted public sale and agrees that
such circumstances shall not, in and of themselves, result in a determination that such sale was not made in a commercially reasonable
manner.

8. 
Reinstatement. This Agreement shall, to the fullest extent permitted by applicable law, remain in full force and
effect and continue to be effective should any petition be filed by or against Pledgor for liquidation or reorganization, should
Pledgor become insolvent or make an assignment for the benefit of creditors or should a receiver or trustee be appointed for all
or any significant part of Pledgor’s assets, and shall continue to be effective or be reinstated, as the case may be, to
the fullest extent permitted by applicable law, if at any time payment and performance of the Note, or any part thereof, is, pursuant
to applicable law, rescinded or reduced in amount, or must otherwise be restored or returned by any obligee of the Note, whether
as a “voidable preference,” “fraudulent conveyance,” or otherwise, all as though such payment or performance
had not been made. In the event that any payment, or any part thereof, is rescinded, reduced, restored or returned, the Note, to
the fullest extent permitted by applicable law, shall be reinstated and deemed reduced only by such amount paid and not so rescinded,
reduced, restored or returned.

9. 
Successors and Assigns. The terms and provisions of this Agreement shall be binding upon, and, subject to the provisions
of this Section 9, the benefits thereof shall inure to, the parties hereto and their respective successors and assigns; provided,
however, that Pledgor shall not assign this Agreement or any of the rights, duties or obligations of Pledgor hereunder without
the prior written consent of Lender.

10.   
Notices. Any notice or communication given pursuant to this Agreement by any party to any other party shall be in
writing and shall be sufficiently given if personally delivered, sent by facsimile or other means of electronic transmission or
sent by mail, postage prepaid to the parties at the following addresses or to such other address as any party may hereafter designate
to the others by like notice:

if to Pledgor:

Cabinet Grow,
Inc.

Attn: Barry
Hollander

17801 Main Street #E

Irvine, California
92614

 

If to Lender:

 

Tonaquint, Inc.

Attn: John Fife

303 East Wacker
Drive, Suite 1040

Chicago, Illinois
60601

 

with a copy to
(which shall not constitute notice”):

 

Hansen Black
Anderson Ashcraft PLLC

Attn: Jonathan
K. Hansen

3051 West Maple
Loop Drive, Suite 325

Lehi, Utah 84043

 

Each such notice or other communication shall
for all purposes of this Agreement be treated as effective or having been given when delivered if delivered personally, or, if
sent by mail, at the earlier of its receipt or four (4) days after the same has been deposited in a regularly maintained receptacle
for the deposit of the United States mail, addressed and mailed as aforesaid or, if sent by facsimile, upon confirmation of facsimile
transfer or, if sent by electronic mail, upon confirmation of delivery when directed to the electronic mail address set forth above.
In the event of any conflict between Lender’s books and records and this Agreement or any notice delivered hereunder, Lender’s
books and records will control absent fraud or error.

 

11.   
Severability. If any provision hereof is invalid and unenforceable in any jurisdiction, then, to the fullest extent
permitted by law, (a) the other provisions hereof shall remain in full force and effect in such jurisdiction and shall be liberally
construed in favor of Lender in order to carry out the intentions of the parties hereto as nearly as may be possible and (b) the
invalidity or unenforceability of any provision hereof in any jurisdiction shall not affect the validity or enforceability of such
provision in any other jurisdiction.

12.   
Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original,
but all of which together shall constitute one and the same instrument. The parties hereto confirm that any telecopy or electronic
copy of another party’s executed counterpart of this Agreement (or its signature page thereof) will be deemed to be an executed
original thereof.

13.   
No Waiver; Cumulative Remedies. Lender shall not by any act, delay, omission or otherwise be deemed to have waived
any of its rights or remedies hereunder, and no waiver shall be valid unless in writing, signed by Lender, and then only to the
extent therein set forth. A waiver by Lender of any right or remedy hereunder on any one occasion shall not be construed as a bar
to any right or remedy which Lender would otherwise have had on any future occasion. No failure to exercise nor any delay in exercising
on the part of Lender, any right, power or privilege hereunder, shall operate as a waiver thereof, nor shall any single or partial
exercise of any right, power or privilege hereunder preclude any other or future exercise thereof or the exercise of any other
right, power or privilege. The rights and remedies hereunder provided are cumulative and may be exercised singly or concurrently,
and are in addition to any rights and remedies provided by law. None of the terms or provisions of this Agreement may be waived,
altered, modified or amended except by an instrument in writing, duly executed by Lender and, where applicable, by Pledgor.

14.   
Attorneys’ Fees. In the event that any suit or action is instituted under or in relation to this Agreement,
including, without limitation, to enforce any provision in this Agreement, the prevailing party in such dispute shall be entitled
to recover from the losing party all fees, costs and expenses of enforcing any right of such prevailing party under or with respect
to this Agreement, including, without limitation, such reasonable fees and expenses of attorneys and accountants, which shall include,
without limitation, all fees, costs and expenses of appeals.

15.   
Construction and Interpretation. The parties hereto have participated jointly in the negotiation and drafting of
this Agreement and each party has been represented by its own legal counsel. In the event
an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by
the parties and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of
any of the provisions of this Agreement.

16.   
Governing Law and Consent to Jurisdiction. The validity, construction, and effect of this Agreement shall be governed
by the laws of the State of Utah, without regard to its laws regarding choice of applicable law.

17.   
Headings. Captions and headings in this Agreement are for convenience only and are not to be deemed part of this
Agreement.

18.   
Power of Attorney; Appointment and Powers of Lender. Upon the occurrence and during the continuance of an Event of
Default, Pledgor hereby irrevocably constitutes and appoints Lender and any officer or agent thereof, with full power of substitution,
as its true and lawful attorney-in-fact with full irrevocable power and authority in the place and stead of Pledgor or in Lender’s
own name, for the purpose of carrying out the terms of this Agreement, to take any and all appropriate action and to execute any
and all documents and instruments that may be necessary or desirable to accomplish the purposes of this Agreement and, without
limiting the generality of the foregoing, hereby gives such attorneys the power and right, on behalf of Pledgor, without notice
to or assent by Pledgor, to do the following:

a. 
generally to sell, transfer, pledge, make any agreement with respect to or otherwise deal with any of the Pledged Membership
Interest in such manner as is consistent with the UCC and as fully and completely as though Lender was the absolute owner thereof
for all purposes, and to do at Pledgor’s expense, at any time, or from time to time, all acts and things which Lender deems
necessary to protect, preserve or realize upon the Pledged Membership Interest and Lender’s security interest therein, in
order to effect the intent of this Agreement, all as fully and effectively as Pledgor might do, including, without limitation,
(A) upon written notice to Pledgor, the exercise of voting rights with respect to the Pledged Membership Interest, which rights
may be exercised, if Lender so elects, with a view to causing the liquidation of assets of the Company, and (B) the execution,
delivery and recording, in connection with any sale or other disposition of any Pledged Membership Interests, of the endorsements,
assignments or other instruments of conveyance or transfer with respect to such Pledged Membership Interest; and

b. 
to the extent that Pledgor’s authorization given in Section 20 is not sufficient, to file such financing statements
with respect hereto, with or without Pledgor’s signature, or a photocopy of this Agreement in substitution for a financing
statement, as Lender may deem appropriate and to execute in Pledgor’s name such financing statements and amendments thereto
and continuation statements which may require Pledgor’s signature.

19.   
Irrevocable Proxy. Solely with respect to Article 8 Matters, Pledgor hereby irrevocably grants and appoints Lender,
from the date of this Agreement until the termination of this Agreement in accordance with its terms, as Pledgor’s true and
lawful proxy, for and in Pledgor’s name, place and stead to vote the Pledged Membership Interest in the Company owned by
Pledgor, whether directly or indirectly, beneficially or of record, now owned or hereafter acquired, with respect to such Article
8 Matters. The proxy granted and appointed in this Section 19 shall include the right to sign Pledgor’s name (as a
member of the Company) to any consent, certificate or other document relating to an Article 8 Matter and the Pledged Membership
Interest that applicable law may permit or require, to cause the Pledged Membership Interest to be voted in accordance with the
preceding sentence. Pledgor hereby represents and warrants that there are no other proxies and powers of attorney with respect
to an Article 8 Matter and the Pledged Membership Interest that Pledgor may have granted or appointed. Pledgor will not give a
subsequent proxy or power of attorney or enter into any other voting agreement with respect to the Pledged Membership Interest
with respect to any Article 8 Matter and any attempt to do so with respect to an Article 8 Matter shall be void and of no effect.

20.   
Termination. Upon the full payment and performance of the Note, this Agreement shall terminate and be of no further
force and effect. Upon any such termination, Lender shall authenticate and deliver to Pledgor the Pledged Membership Interest together
with such documents as Pledgor may reasonably request to evidence such termination at Pledgor’s expense.

21.   
Authorization to File UCC Financing Statements. Pledgor hereby authorizes Lender to file UCC financing statements
concerning the Pledged Membership Interest. Pledgor will execute and deliver any documents (properly endorsed, if necessary) reasonably
requested by Lender for the perfection or enforcement of any security interest or lien, give good faith, diligent cooperation to
Lender, and perform such acts reasonably requested by Lender for perfection and enforcement of any security interest or lien, including,
without limitation, obtaining control for purposes of perfection with respect to the Pledged Membership Interest. Lender is authorized
to file, record, or otherwise utilize such documents as it deems necessary to perfect and/or enforce any security interest or lien
granted hereunder.

[Remainder of page
intentionally left blank]

    	 

    	 

    

IN WITNESS WHEREOF,
each of the parties hereto has caused this Agreement to be executed as set forth above.

 

 

	PLEDGOR:
	 
	CABINET GROW, INC.
	 	 
	By: 	/s/ Samuel May
	Name: 	Samuel May
	Title: 	Chief Executive Officer

 

 

 

Agreed and Accepted:

 

 

	TONAQUINT, INC.
	 	 
	By: 	/s/ John M. Fife
		John M. Fife, President

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