Document:

ex4_8.htm

    
      CERTIFICATE
OF DESIGNATION, NUMBER, POWERS

      PREFERENCES
AND RELATIVE, PARTICIPATING

      OPTIONAL,
AND OTHER SPECIAL RIGHTS AND THE

      QUALIFICATIONS,
LIMITATIONS, RESTRICTIONS, AND

      OTHER
DISTINGUISHING CHARACTERISTICS OF

      SERIES
C PREFERRED STOCK

      OF

      US
FARMS, INC.

      

      

      It
is hereby certified that:

      

      1. The
name of the corporation (hereinafter called the “Corporation) is US FARMS, INC.

      

      2. The
certificate of incorporation of the Corporation authorizes issuance of
30,000,000 shares of Preferred Stock with a par value of $0.001 per share and
expressly vests in the Board of Directors of the Corporation the authority
provided therein to issue any or all of said shares in one or more Series and by
resolution or resolutions, the designation, number, full or limited voting
powers, or the denial of voting powers, preferences and relative participating,
optional, and other special rights and the qualifications, limitations,
restrictions, and other distinguishing characteristics of each series to be
issued.

      

      3. The Board of Directors of the
Corporation, pursuant to the authority expressly vested in it as aforesaid, has
adopted the following resolutions creating a Series C issue of Preferred
Stock:

      

      RESOLVED,
that thirteen million (13,000,000) shares of the Preferred Stock (par value
$0.001 per share) are authorized to be issued by this Corporation pursuant to
its certificate of incorporation, and that there be and hereby is authorized and
created a series of preferred stock, hereby designed as the Series C Preferred
Stock, which shall have the voting powers, designations, preferences and
relative participating, optional or other rights, if any, or the qualifications,
limitations, or restrictions, set forth in such certificate of incorporation and
in addition thereto, those following:

      

      
        	
                (a)  

              	
                DESIGNATION.
      The Preferred Stock subject hereof shall be designated Series C Preferred
      Stock (“Series C Preferred”).  No other shares of Preferred
      Stock shall be designated as Series C Preferred
  stock.

              

      

       

      
        	
                (b)  

              	
                DIVIDENDS.  The
      holders of the shares of Series C Preferred shall not be entitled to
      receive dividends.

              

      

       

      
        
          
          

        

        
          1

          
            

          

        

        
          
          

        

      

      
        	
                (c)  

              	
                CONVERSION.  The
      Series C Preferred shall, at the option of the holder thereof, be
      convertible into that number of fully paid and non-assessable shares of
      the common stock of the Corporation,equal
      to the number of the shares of Series C Preferred Stock being
      converted.  The conversion right of the holders of Series C
      Preferred Stock shall be exercised by the surrender of the certificates
      representing shares to be converted to the Corporation or its transfer
      agent for the Series C Preferred, accompanied by written notice electing
      conversion.  Immediately prior to the close of business on the
      date the Corporation receives written notice of conversion, each
      converting holder of Series C Preferred shall be deemed to be the holder
      of record of common stock issuable upon conversion of such holder’s Series
      C Preferred notwithstanding that the share register of the Corporation
      shall then be closed or that certificates representing such common stock
      shall not then be actually delivered to such
  person.

              

      

       

      
        	
                (d)  

              	
                ADJUSTMENTS
      FOR RECLASSIFICATION AND REORGANIZATION.  If the common stock
      issuable upon conversion of the Series C Preferred shall be changed into
      the same or different number of shares of any other class or classes of
      stock, whether by capital reorganization, reclassification or otherwise,
      the conversion rate shall, concurrently with the effectiveness of such
      reorganization or reclassification, be proportionately adjusted so that
      the Series C Preferred shall be convertible into, in lieu of the number of
      shares of common stock which the holders would otherwise have been
      entitled to receive, a number of shares of such other class or classes of
      stock equivalent to the number of shares of common stock that would have
      been subject to receipt by the holders upon conversion of the Series C
      Preferred immediately before that
change.

              

      

       

      
        	
                (e)  

              	
                REORGANIZATIONS,
      MERGERS, CONSOLIDATIONS OR SALES OF ASSETS.  If at any time or
      from time to time after the date of this Certificate, there is a capital
      reorganization of the common stock (reverse split, forward split, etc.),
      as a part of such capital reorganization, provision shall be made so that
      the holders of the Series C Preferred shall thereafter be entitled to
      receive upon conversion of the Series C Preferred the same number of
      shares of common stock to which that holder would have been entitled prior
      to such capital reorganization.  In essence, the number of
      Series C Preferred Stock authorized, issued and outstanding, and the
      number of shares of common stock into which such Series C Preferred is
      convertible, shall not be affected by any such capital
      reorganization.

              

      

       

      
        	
                (f)  

              	
                NO
      IMPAIRMENT.  The Corporation will not, by amendment of its
      Certificate of Incorporation or through any reorganization, transfer of
      assets, consolidation, merger, dissolution, issue or sale of securities or
      any other voluntary action, avoid or seek to avoidthe
      observance or performance of any of the terms to be observed or performed
      hereunder by the Corporation, but will at all times in good faith assist
      in the carrying out all the provisions of this Certificate and in the
      taking of all such action as may be necessary or appropriate in order to
      protect the conversion rights of the holders of the Series C Preferred
      against impairment.

              

      

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

      
        	
                (g)  

              	
                RESERVATION
      OF STOCK ISSUABLE UPON CONVERSION.  The Corporation 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 the
      shares of the Series C Preferred, such number of its shares of common
      stock as shall from time to time be sufficient to effect the conversion of
      all outstanding shares of the Series C Preferred; and if at any time the
      number of authorized but unissued shares of common stock shall not be
      sufficient to effect the conversion of all then outstanding shares of the
      Series C Preferred, the Corporation will take such corporate action as
      may, in the opinion of its counsel, be necessary to increase its
      authorized but unissued shares of common stock to such number of shares as
      shall be sufficient for such purpose, including, without limitation,
      engaging in best efforts to obtain the requisite stockholder approval of
      any necessary amendment to this
Certificate.

              

      

       

      
        	
                (h)  

              	
                LIQUIDATION
      RIGHTS.  In the event of any voluntary or involuntary
      liquidation, dissolution or winding up of the Corporation, the holders of
      the Series C Preferred shall not be entitled to receive liquidation in
      preference to the holders of common shares or any other class or series of
      preferred stock.  Rather, the Series C Preferred shall
      automatically be converted into common stock at the conversion rate
      hereinabove stated.

              

      

       

      
        	
                (i)  

              	
                INVOLUNTARY
      LIQUIDATION.  In the event of involuntary liquidation, the
      shares of this series shall be entitled to the same amounts as in the
      event of voluntary liquidation.

              

      

       

      
        	
                (j)  

              	
                OTHER
      RESTRICTIONS.  There shall be no conditions or restrictions upon
      the creation of indebtedness of the Corporation, or any subsidiary or upon
      the creation of any other series of preferred stock with any other
      preferences.

              

      

       

      
        	
                (k)  

              	
                VOTING.  Each
      shares of Series C Preferred shall entitle its holder to one vote, voting
      together with the Common Stock as a single class.
  

              

      

       

      
        	
                (l)  

              	
                STATED
      VALUE.  The shares of Series C Preferred shall have a stated
      value of $0.001 per share.

              

      

       

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

      
        	
                (m)  

              	
                OTHER
      PREFERENCES.  The shares of the Series C Preferred shall no
      other preferences, rights, restrictions, or qualifications, except as
      otherwise provided by law or the certificate of incorporation of the
      Corporation.

              

      

       

      
        FURTHER
RESOLVED, that the statements contained in the foregoing resolution creating and
designating the said Series C Preferred Stock and fixing the number, powers,
preferences and relative, optional, participating, and other special rights and
the qualifications, limitations, restrictions, and other distinguishing
characteristics thereof shall, upon the effective date of said series, be deemed
to be included in and be a part of the certificate or incorporation of the
Corporation.

      

       

       

      
        	
                 
      

              	
                Signed
      on April 30, 2008.

              

      

      

      

      
        	
                 
      

              	
                By
      Unanimous Written Consent of the Board of
  Directors:

              

      

      

      

      
        	
                 
      

              	
                /s/
      Yan
      Skwara

              

      

      
        	
                 
      

              	
                Yan
      Skwara, Chairman of the Board of
Directors

              

      

      

      

      
        	
                 
      

              	
                /s/
      Donald
      Hejmanowski

              

      

      
        	
                 
      

              	
                Donald
      Hejmanowski, Director

              

      

      

      

      
        	
                 
      

              	
                /s/
      Darin
      Pines

              

      

      
        	
                 
      

              	
                Darin
      Pines, Director

              

      

      
        
           

        

        
          4ex10_13.htm

    
      Loan
Agreement

      

      THIS LOAN AGREEMENT is entered into as
of May 1, 2008 (the “Effective Date”) between Centaur Farms of Southern
California, Inc., a California corporation (“Lender”) and U.S. Farms, Inc., a
Nevada corporation (“Borrower”), who agree as follows:

       

      1.  Loan.  Subject
to all of the terms and conditions set forth herein, Lender agrees to loan to
Borrower $125,000.00 evidenced by a promissory note in the form attached hereto
as Exhibit A (the “Promissory Note”) secured by substantially all of the assets
(the “Collateral”) of Borrower in accordance with a security agreement, in the
form attached as Exhibit B (the
“Security Agreement”) and certain shares of common stock of Borrower pledged by
one of Borrower’s principal stockholders pursuant to the terms and conditions of
a stock pledge agreement in the form attached hereto as Exhibit C (“Stock
Pledge Agreement”).  The principal outstanding balance of this loan
shall be due and payable by the Borrower to the Lender in full, without demand,
on or before the 120th day
after the Effective Date (the “Due Date”).  The unpaid principal
balance of the loan shall bear interest at the rate of twenty percent (20%) per
annum or the maximum permitted by law, whichever is less.

      

      2.  Additional
Consideration. As additional consideration for the Loan, Borrower hereby
agrees to issue and deliver to Lender, 500,000 shares of Borrowers’ common stock
($.001 par value) which shares shall be delivered upon the execution of this
Loan Agreement.

      

      3.  Security For
Loan.  As security for Borrower’s obligations under the
Promissory Note, and as a condition precedent to Lender making the loan to
Borrower, Borrower shall cause the following:

      

      (a) Borrower
shall execute the Security Agreement in favor of Lender, securing all of the
assets of Borrower; and

      

      (b) Borrower’s
President, Yan K. Skwara (“Skwara”), shall deliver into escrow and pledge as
security for Borrower’s obligations under the Promissory Note and all related
agreements twelve million five hundred thousand (12,500,000) shares of Series C
Convertible Preferred Stock of Borrower in the name of Skwara (the “Shares”),
pursuant to the terms and conditions of the Stock Pledge Agreement by and among
Skwara, Borrower, and Lender, and an Escrow Agreement in the form attached
hereto as Exhibit D (the
“Escrow Agreement”) by the same parties.  Borrower represents and
warrants that such Shares are duly authorized, validly issued and fully paid for
by Skwara.

      

      (c) Borrower’s
representations and warranties made in connection with this Agreement shall be
true and correct in all material respects.

      

      4.  Escrow
Agent.  The escrow agent under the Escrow Agreement shall be de
Castro, P.C., 309 Laurel Street, San Diego, California 92101
(“DPC”).  All parties understand that DPC is also counsel to
Lender.  DPC shall have the right to continue acting as counsel to
Lender, notwithstanding its duties as escrow agent under the Escrow
Agreement.  All parties expressly consent to such
arrangement.

      

      
        
           

        

        
          1

          
            

          

        

        
           

        

      

      5.  Closing.  The
closing of this transaction (the “Closing”) shall take place at such time and
place as the parties may mutually agree to, but in no event later than May 2,
2008.

      

      6.  Deliveries at
Closing:  The parties shall deliver the following at the
Closing::

      

      (a) Borrower
shall deliver the following to Lender (unless otherwise specifically
noted):

      

      
        	
                i.  

              	
                The
      Promissory Note, duly executed by Borrower in favor of
    Lender;

              

      

      

      
        	
                ii.  

              	
                The
      Security Agreement, duly executed by Borrower in favor of
      Lender;

              

      

      

      
        	
                iii.  

              	
                The
      Stock Pledge Agreement, duly executed by Skwara and Borrower
      in     favor of
Lender;

              

      

      

      
        	
                iv.  

              	
                The
      Escrow Agreement, duly executed by Skwara and
  Borrower;

              

      

      

      
        	
                v.  

              	
                The
      Stock certificates representing the Shares, delivered to Escrow Agent;
      and

              

      

      

      
        	
                vi.  

              	
                Such
      other documents and instruments as may be reasonably
      requested.

              

      

      

      (b) Lender
shall deliver to Borrower:

       

      
        
          	
                  i.  

                	
                  $125,000
      cash; and

                

        

         

      

      
        	
                ii.  

              	
                The
      Security Agreement, the Stock Pledge Agreement, and the Escrow Agreement
      duly executed by Lender.

              

      

      

      7.  Representations.  In
connection with the Loan provided for herein, the Borrower hereby represents and
warrants as follows, with each representation being material and relied upon by
the Lender:

      

      (a) Due
Organization.  The Borrower is a corporation, duly organized
and validly existing and in good standing under the laws of the State of Nevada
and has full power and authority to enter into this Agreement and consummate the
transactions contemplated hereby. The execution and delivery of this Agreement
and the consummation of the transactions provided for herein will not violate or
conflict with any restrictions, covenants, agreements or other provisions made
by the Borrower, or to which the Borrower may be subject.

      

      (b) Corporate
Approval.  The execution of this Agreement and approval of the
transaction provided for herein have been duly authorized by the Board of
Directors of the Borrower and, if necessary, by its shareholders and all
necessary regulatory authorities.

      

      
        
           

        

        
          2

          
            

          

        

        
           

        

      

      (c) Marketable
Title.  The Borrower has good and marketable title in and to
the Collateral and will, in accordance with the terms of the Security Agreement,
pledge and grant to the Lender a security interest in the Collateral which is
free and clear of any and all liens, claims, encumbrances, other pledges or
security interests and all other defects of title or other matters
whatsoever.

      

      (d) Enforceability. This
Agreement, the Promissory Note, Security Agreement, the Escrow Agreement, and
the Stock Pledge Agreement (collectively, the “Loan Documents”) will be valid
and binding obligations of Borrower, enforceable according to their terms,
except as may be limited by: (i) applicable bankruptcy, insolvency,
reorganization, moratorium or other laws of general application affecting
enforcement of creditors’ rights; (ii) general principles of equity that
restrict the availability of equitable or legal remedies.

      

      8.  Covenants.  So
long as the Loan shall remain unpaid, the Borrower hereby covenants and agrees
with the Lender as follows:

      

      (a) The
Borrower will not, without the prior written consent of Lender, further encumber
or grant additional security interests in and to the Collateral.

      

      (b) The
Borrower shall execute any and all other instruments or documents as may
reasonably be required to consummate the agreements of the Borrower under the
terms of the Loan Documents.

      

      9.  Events of Default.
For purposes of this Agreement, “Event of Default” means: (a) the failure of
Borrower to pay any monetary amount within five (5) days of the due date thereof
as provided under the Loan Documents; or (b) the failure by a party to satisfy a
non-monetary obligation under the Loan Documents within 10 days after receiving
a written notice of default from the other party.

      

      10.  Remedies.  Upon
the occurrence of an Event of Default or at any time thereafter, the Lender may,
at its option and without notice, accelerate the maturity of the Loan and
proceed with each and every right, power and remedy provided for in the Loan
Documents.  The Lender may pursue any other right, power or remedy
available to it, whether at law, in equity, by statute or otherwise, to enforce
collection of all amounts and performance of all other obligations due and owing
to him.  The Lender shall be entitled to recover all of its costs and
expenses, including reasonable attorney’s fees, incurred in connection with the
enforcement of any and all rights, powers and remedies under the Loan Documents
and in addition Lender shall be entitled to recover from Borrower, as Liquidated
Damages, the sum of $50,000, in addition to all other obligations of Borrower to
Lender.

      

      11.  Notices.  Unless
otherwise changed by notice given in accordance with this provision, any notice
or other communication required or permitted herein shall be in writing and
shall be deemed to have been duly given if delivered by hand, overnight courier,
facsimile transmission or prepaid cable or
telegram  and  confirmed in writing,  or
mailed  first  class,  postage
prepaid,  by registered or
certified  mail,  return  receipt  requested  (mailed
notices and notices sent by facsimile  transmission, cable or telegram
shall be deemed to have been given on the date sent) as follows:

      

      
        
           

        

        
          3

          
            

          

        

        
           

        

      

       If
to the Lender, as follows:

      Centaur Farms of Southern
California

      Attention:  Gary Cropp,
President

      P.O. Box 675645

      14725 Rancho Santa Fe Farms
Road

      Rancho Santa Fe, CA 92067

      

               With
a copy to:

      Stanley M. Moskowitz, Esq.

      de Castro,P.C.

      309 Laurel Street

      San Diego, CA 92101

      FAX:  619-702-9401

      

               If
to the Borrower, as follows:

      

      US Farms, Inc.

      1635 Rosecrans Street, Suite
C

      San Diego, CA 92106

      FAX: 858-488-2828

      

               With
a copy to:

      

      12.  Counterparts; Facsimile
Execution.  This Agreement may be executed in counterparts,
each of which is deemed an original and all of which together constitute one
document. This Agreement may be executed in counterparts by original or telefax
signatures, and all counterparts of this Agreement which are executed by telefax
signature shall be valid and binding as original signatures for all purposes
(evidentiary or otherwise).

      

      13.  Governing
Law.  This Agreement is governed by and construed in accordance
with the laws of the State of California.  All actions and proceedings
arising in connection with this Agreement must be tried and litigated
exclusively in the State and Federal courts located in San Diego County, State
of California, which courts have personal jurisdiction and venue over each of
the parties to this Agreement for the purpose of adjudicating all matters
arising out of or related to this Agreement.

      

      14.  Drafting
Ambiguities.  Each party to this Agreement and its legal
counsel have had an opportunity to review and revise this
Agreement.  The rule of construction that ambiguities are to be
resolved against the drafting party may not be employed in the interpretation of
this Agreement or any amendment to this Agreement.

      

      15.  Entire
Agreement.  This Agreement and all documents specifically
referred to and executed in connection with this Agreement:  (a)
contain the entire and final agreement of the parties to this Agreement with
respect to the subject matter of this Agreement, and (b) supersede all
negotiations, stipulations, understandings, agreements, representations and
warranties, if any, with respect to such subject matter, which precede or
accompany the execution of this Agreement.

      

      
        
           

        

        
          4

          
            

          

        

        
           

        

      

      16.  Modification.  This
Agreement may be modified only by a contract in writing executed by the party to
this Agreement against whom enforcement of the modification is
sought.

      

      

      17.  Further
Assurances.  Borrower shall take such further actions and
execute such other documents as may be necessary to effectuate the terms of the
Loan Documents.

      

      18.  Severability.  In
the event that any provision of this Agreement is invalid or unenforceable under
any applicable statute or rule of law, then such provision shall be deemed
inoperative to the extent that it may conflict therewith and shall be deemed
modified to conform with such statute or rule of law.  Any such
provision which may prove invalid or unenforceable under any law shall not
affect the validity or enforceability of any other provision of this
Note.

      

      

      

      

      LENDER:                                                                                     BORROWER:

      

      CENTAUR
FARMS OF
SOUTHERN                                                                                                US
FARMS, INC.

      CALIFORNIA,
INC.                                                                           A
NEVADA CORPORATION

      a
California corporation

      

      

      By/s/ Gary
Cropp                                                                By: /s/ Yan
Skwara

      Gary Cropp,
President                                                                                                Yan
Skwara, CEO

      
        
           

        

        
          5

          
            

          

        

        
           

        

      

      EXHIBIT
A

      PROMISSORY
NOTE

      

      $
125,000                                 
May 1, 2008

                                       San
Diego, California

      

      

               FOR
VALUE RECEIVED, US Farms, Inc., a Nevada corporation,
whose address is 1635 Rosecrans Street, Suite C, San Diego, California 92106 (
the "Company"), promises to pay to Centaur Farms of Southern California, Inc.
("Holder"), or its assigns, the principal sum of One Hundred Twenty Five
Thousand Dollars ($125,000) (the “Principal Amount”), or such greater amount as
shall equal the outstanding principal amount hereof and any unpaid accrued
interest hereon, as set forth below, shall be due and payable on September 2,
2008.

      

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

      

                 
1.      Interest. Commencing
on the date above written and thereafter until all outstanding principal and
interest on this Note shall have been paid in full, Company shall pay interest
at the rate of twenty percent (20%) per annum on the Principal Amount of this
Note.

      

                 
2.     Prepayment. This Note
may be prepaid in whole or in part at any time by the Company without the prior
written consent of Holder. Any such prepayment will be applied first to the
payment of interest accrued on this Note and second, if the amount of prepayment
exceeds the amount of all accrued interest, to the payment of principal of this
Note.

      

                 
3.      Events of Default.
The occurrence of any of the following shall constitute an "Event of Default"
under this Note:

      

                             
 (a) Failure to
Pay.  If Company shall fail to pay any payment when due, and
any interest required under the terms of this Note on the date due and such
payment shall not have been made within five (5) days of the due date;
or

      

                             
(b) Voluntary
Bankruptcy or Insolvency Proceedings. If the 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) make a general
assignment for the benefit of its or any of its creditors, , (iii) 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 (iv) take any
action for the purpose of effecting any of the foregoing;

      

                             
(c) Involuntary
Bankruptcy or Insolvency Proceedings. If proceedings for the appointment
of a receiver, trustee, liquidator or custodian of the 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
the Company or the debts thereof under any bankruptcy, insolvency or other
similar law or hereafter in effect shall be commenced, and an order for relief
entered in such proceeding shall not be dismissed or discharged within thirty
(30) days of the entry of such an order.

      

      
        
           

        

        
          A-1

          
            

          

        

        
           

        

      

               
 4.      Rights of Holder Upon
Default. Upon the occurrence or existence of any Event of Default and at
any time thereafter during the continuance of such Event of Default, Holder may
declare all outstanding obligations payable by Borrower hereunder to be
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 granted to it or otherwise
permitted to it by law, either by suit in equity or by action at law, or
both.

       

        
5.      Costs and Expenses--Liquidated
Damages  The Lender shall be entitled to recover all of its
costs and expenses, including reasonable attorney’s fees, incurred in connection
with the enforcement of any and all rights, powers and remedies under the Loan
Documents and in addition Lender shall be entitled to recover from Borrower, as
Liquidated Damages, the sum of $50,000, in addition to all other obligations of
Borrower to Lender.

       

                
6.      Security
Interest.  The Holder has been granted a security interest in
certain Shares of common stock as more fully described in the Pledge Agreement
dated as of the date hereof between the Holder, the Company, and the Pledgor as
described in such Agreement, as well as in substantially all of the assets of
the Company as more fully described in the Security Agreement between the
Company and Holder.

      

                 
7.      Successors and
Assigns. The rights and obligations of the Company and the Holder of this
Note shall be binding upon and benefit the successors, assigns, heirs,
administrators and transferees of the parties.

      

                
 8.      Waiver and Amendment.
Any provision of this Note may be amended, waived or modified upon the written
consent of the Company and the Holder.

      

                
 9.      Notices. Any notice,
request or other communication required or permitted hereunder shall be in
writing and shall be deemed to have been duly given (i) upon receipt if
personally delivered, (ii) three (3) days after being mailed by registered or
certified mail, postage prepaid, or (iii) one day after being sent by recognized
overnight courier or by facsimile, if to the Holder, at Centaur Farms of
Southern California, Inc.,  Attention:  Gary Cropp,
President, P.O. Box 675645, 14725 Rancho Santa Fe Farms Road, Rancho Santa Fe,
CA 92067, or at such other address or number as the Holder shall have furnished
to Company in writing, or if to Company, at 1635 Rosecrans Street, Suite C, San
Diego, CA 92106 or
at such other address or number as the Company shall have furnished to the
Holder in writing.

      

                 
10.    Payment. Payment
shall be made in lawful tender of the United States.

      

      
        
           

        

        
          A-2

          
            

          

        

        
           

        

      

               
 11.     Governing Law. The
descriptive headings of the several sections and paragraphs of this Note are
inserted for convenience only and do not constitute a part of this Note. 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
California, without regard to the conflicts of law provisions of the State of
California, or of any other state.

       

       
12.     Severability.  In
the event that any provision of this Note is invalid or unenforceable under any
applicable statute or rule of law, then such provision shall be deemed
inoperative to the extent that it may conflict therewith and shall be deemed
modified to conform with such statute or rule of law.  Any such
provision which may prove invalid or unenforceable under any law shall not
affect the validity or enforceability of any other provision of this
Note.

      

      

               IN
WITNESS WHEREOF, Company has caused this Note to be issued as of
the

      date
first written above.

      

                                                    US
Farms, Inc.

                                                    a
Nevada corporation

      

      

                                                    By:

                                                       /s/ Yan
Skwara                                                      

      

                                                    Title:

                                                          Chief Executive
Officer                                                      

      

      

      

      
        
          
             

            

          

           

        

        
          A-3

          
            

          

        

        
           

        

      

      EXHIBIT
B

      SECURITY
AGREEMENT

      

       

      SECURITY
AGREEMENT (this “Agreement”), dated as
of  May 1, 2008, by and between Centaur Farms of Southern California, Inc.,
a California corporation (“Lender”) and U.S. Farms, Inc., a Nevada corporation
(“Borrower”).

       

      W
I T N E S S E T H:

       

      WHEREAS,
pursuant to a Loan Agreement, dated the date hereof, between the Lender and the
Borrower, the Lender has agreed to loan to Borrower $125,000.00 evidenced by a
promissory note (the “Note”) of Borrower; 

       

      WHEREAS,
in order to induce the Lender to purchase the Note, the Borrower has agreed to
execute and deliver to the Lender this Agreement for the benefit of the Lender
and to grant to it security interest in substantially all of the assets (the
“Collateral”) to secure the prompt payment, performance and discharge in full of
all of the Borrower’s obligations under the Loan Documents (as defined in the
Loan Agreement);

       

      NOW,
THEREFORE, in consideration of the agreements herein contained and for other
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto hereby agree as follows:

       

      ARTICLE
I Certain
Definitions.  As used in this
Agreement, the following terms shall have the meanings set forth in this Section
1.  Terms used but not otherwise defined in this Agreement that are
defined in Article 9 of the UCC (such as “general intangibles”
and “proceeds”)
shall have the respective meanings given such terms in Article 9 of the
UCC.

       

      1.1 “Collateral” means the
collateral in which the Lender is granted a security interest by this Agreement
and which shall include the following, whether presently owned or existing or
hereafter acquired or coming into existence, and all additions and accessions
thereto and all substitutions and replacements thereof, and all proceeds,
products and accounts thereof, including, without limitation, all proceeds from
the sale or transfer of the Collateral and of insurance covering the same and of
any tort claims in connection therewith:

       

      (a) cash,
cash equivalents, accounts, accounts receivable, and deposit accounts
(collectively “Cash Equivalents”); and

       

      (b) All
Goods of the Borrower, including, without limitations, all machinery, equipment,
computers, motor vehicles, trucks, tanks, boats, ships, appliances, furniture,
special and general tools, fixtures, test and quality control devices and other
equipment of every kind and nature and wherever situated, together with all
documents of title and documents representing the same, all additions and
accessions thereto, replacements therefor, all parts therefor, and all
substitutes for any of the foregoing and all other items used and useful in
connection with the Borrower’s businesses and all improvements thereto
(collectively, the “Equipment”);
and

       

      
        
           

        

        
          B-1

          
            

          

        

        
           

        

      

      (c) All
Inventory of the Borrower; and

       

      (d) All
of the Borrower’s contract rights and general intangibles, including, without
limitation, all partnership interests, stock or other securities, licenses,
distribution and other agreements, computer software development rights, leases,
franchises, customer lists, quality control procedures, grants and rights,
goodwill, trademarks, service marks, trade styles, trade names, patents, patent
applications, copyrights, deposit accounts, and income tax refunds
(collectively, the “General
Intangibles”); and

       

      (e) All
Receivables of the Borrower including all insurance proceeds, and rights to
refunds or indemnification whatsoever owing, together with all instruments, all
documents of title representing any of the foregoing, all rights in any
merchandising, goods, equipment, motor vehicles and trucks which any of the same
may represent, and all right, title, security and guaranties with respect to
each Receivable, including any right of stoppage in transit; and

       

      (f) All
of the Borrower’s documents, instruments and chattel paper, files, records,
books of account, business papers, computer programs, and all other assets of
Borrower, and the products and proceeds of all of the foregoing Collateral set
forth in clauses (i)-(vi) above.

       

      1.2 “Obligations” means
all of the Borrower’s Obligations under  the Loan Documents, in each
case, whether now or hereafter existing, voluntary or involuntary, direct or
indirect, absolute or contingent, liquidated or unliquidated, whether or not
jointly owed with others, and whether or not from time to time decreased or
extinguished and later decreased, created or incurred, and all or any portion of
such Obligations or liabilities that are paid, to the extent all or any part of
such payment is avoided or recovered directly or indirectly from the Lender as a
preference, fraudulent transfer or otherwise as such Obligations may be amended,
supplemented, converted, extended or modified from time to time.

       

      1.3 “UCC” means the
Uniform Commercial Code, as currently in effect in the State of
California.

       

      ARTICLE
II Grant of
Security Interest.  As an inducement
for the Lender to purchase the Note and to secure the complete and timely
payment, performance and discharge in full, as the case may be, of all of the
Obligations, the Borrower hereby, unconditionally and irrevocably, pledges,
grants and hypothecates to the Lender, a continuing security interest in, a
continuing lien upon, an unqualified right to possession and disposition of and
a right of set-off against, in each case to the fullest extent permitted by law,
all of the Borrower’s right, title and interest of whatsoever kind and nature in
and to the Collateral (the “Security
Interest”).

       

      ARTICLE
III Representations,
Warranties, Covenants and Agreements of the Borrower.  The Borrower
represents and warrants to, and covenants and agrees with, the Lender as
follows:

       

      
        
           

        

        
          B-2

          
            

          

        

        
           

        

      

      3.1 The
Borrower has the requisite corporate power and authority to enter into this
Agreement and otherwise to carry out its Obligations.  The execution,
delivery and performance by the Borrower of this Agreement and the filings
contemplated therein have been duly authorized by all necessary action on the
part of the Borrower and no further action is required by the
Borrower.  This Agreement constitutes a legal, valid and binding
obligation of the Borrower enforceable in accordance with its terms, except as
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting the enforcement of creditor’s rights
generally.

       

      3.2 The
Borrower represents and warrants that its principal place of business is located
in San Diego, California, where its respective books of account and records are
kept (other than temporarily at the offices of its attorneys or accountants) or
places where Collateral is stored or located, except as set forth on Schedule A attached
hereto;

       

      3.3 The
Borrower is the sole owner of the Collateral (except for non-exclusive licenses
granted by the Borrower in the ordinary course of business), free and clear of
any liens, security interests, encumbrances, rights or claims, and is fully
authorized to grant the Security Interest in and to pledge the Collateral, there
is not on file in any governmental or regulatory authority, agency or recording
office an effective financing statement, security agreement, license or transfer
or any notice of any of the foregoing (other than those that have been filed in
favor of the Lender pursuant to this Agreement) covering or affecting any of the
Collateral except as set forth on Exhibit 3(c).  So long as this
Agreement shall be in effect, the Borrower shall not execute and shall not
knowingly permit to be on file in any such office or agency any such financing
statement or other document or instrument (except to the extent filed or
recorded in favor of the Lender pursuant to the terms of this
Agreement).

       

      3.4 No
part of the Collateral has been judged invalid or unenforceable.  No
written claim has been received that any Collateral or the Borrower’s use of any
Collateral violates the rights of any third party. There has been no adverse
decision to the Borrower’s claim of ownership rights in or exclusive rights to
use the Collateral in any jurisdiction or to the Borrower’s right to keep and
maintain such Collateral in full force and effect, and there is no proceeding
involving said rights pending or, to the best knowledge of the Borrower,
threatened before any court, judicial body, administrative or regulatory agency,
arbitrator or other governmental authority.

       

      3.5 The
Borrower shall at all times maintain its books of account and records relating
to the Collateral at its principal place of business and its Collateral at the
locations set forth on Schedule A attached
hereto and may not relocate such books of account and records or tangible
Collateral unless it delivers to the Lender at least 30 days prior to such
relocation (i) written notice of such relocation and the new location thereof
(which must be within the United States) and (ii) evidence that appropriate
financing statements and other necessary documents have been filed and recorded
and other steps have been taken to perfect the Security Interest to create in
favor of the Lender valid, perfected and continuing liens in the
Collateral.

       

      3.6 This
Agreement creates in favor of the Lender a valid security interest in the
Collateral securing the payment and performance of the Obligations.

       

      3.7 On
the date of execution of this Agreement, the Borrower will deliver to the Lender
one or more executed UCC financing statements on Form-1 with respect to the
Security Interest for filing with the jurisdictions indicated on Schedule B, attached
hereto and in such other jurisdictions as may be requested by the
Lender.

       

      
        
           

        

        
          B-3

          
            

          

        

        
           

        

      

      3.8 The
execution, delivery and performance of this Agreement does not conflict with or
cause a breach or default, or an event that with or without the passage of time
or notice, shall constitute a breach or default, under any agreement to which
the Borrower is a party or by which the Borrower is bound.  No consent
(including, without limitation, from stock holders or creditors of the Borrower)
is required for the Borrower to enter into and perform its Obligations
hereunder.

       

      3.9 The
Borrower shall at all times cooperate with the Lender in maintaining the liens
and Security Interest provided for hereunder as valid and perfected, first
priority, liens and security interests in the Collateral in favor of the Lender
until this Agreement and the Security Interest hereunder shall terminate
pursuant to Section 11.  The Borrower hereby agrees to defend the same
against any and all persons.  The Borrower shall safeguard and protect
all Collateral for the account of the Lender.  At the request of the
Lender, the Borrower will sign and deliver to the Lender at any time or from
time to time one or more financing statements pursuant to the UCC (or any other
applicable statute) in form reasonably satisfactory to the Lender and will pay
the cost of filing the same in all public offices wherever filing is, or is
deemed by the Lender to be, necessary or desirable to effect the rights and
Obligations provided for herein. Without limiting the generality of the
foregoing, the Borrower shall pay all fees, taxes and other amounts necessary to
maintain the Collateral and the Security Interest hereunder, and the Borrower
shall obtain and furnish to the Lender from time to time, upon demand, such
releases and/or subordinations of claims and liens which may be required to
maintain the priority of the Security Interest hereunder.

       

      3.10 The
Borrower shall keep and preserve its Equipment, Inventory and other tangible
Collateral in good condition, repair and order and shall not operate or locate
any such Collateral (or cause to be operated or located) in any area excluded
from insurance coverage.

       

      3.11 The
Borrower shall, within ten (10) days of obtaining knowledge thereof, advise the
Lender promptly, in sufficient detail, of any substantial change in the
Collateral, and of the occurrence of any event which would have a material
adverse effect on the value of the Collateral or on the Lender’s security
interest therein.

       

      3.12 The
Borrower shall promptly execute and deliver to the Lender such further deeds,
mortgages, assignments, security agreements, financing statements or other
instruments, documents, certificates and assurances and take such further action
as the Lender may from time to time request and may in its sole discretion deem
necessary to perfect, protect or enforce its security interest in the Collateral
including, without limitation, the execution and delivery of a separate security
agreement with respect to the Borrower’s intellectual property (“Intellectual Property
Security Agreement”) in which the Lender has been granted a security
interest hereunder, substantially in a form acceptable to the Lender, which
Intellectual Property Security Agreement, other than as stated therein, shall be
subject to all of the terms and conditions hereof.

       

      
        
           

        

        
          B-4

          
            

          

        

        
           

        

      

      3.13 The
Borrower shall permit the Lender and its representatives and agents to inspect
the Collateral at any time during reasonable business hours, and to make copies
of records pertaining to the Collateral as may be requested by the Lender from
time to time, so long as the Lender provides the Borrower with reasonable prior
notice.

       

      3.14 The
Borrower will take all steps reasonably necessary to diligently pursue and seek
to preserve, enforce and collect any rights, claims, causes of action and
accounts receivable in respect of the Collateral.

       

      3.15 The
Borrower shall promptly notify the Lender in sufficient detail upon becoming
aware of any attachment, garnishment, execution or other legal process levied
against any Collateral and of any other information received by the Borrower
that may materially affect the value of the Collateral, the Security Interest or
the rights and remedies of the Lender hereunder.

       

      3.16 All
information heretofore, herein or hereafter supplied to the Lender by or on
behalf of the Borrower with respect to the Collateral is accurate and complete
in all material respects as of the date furnished.

       

      ARTICLE
IV Defaults.  The
following events shall be “Events of
Default”:

       

      4.1 The
occurrence of an Event of Default (as defined in the  Loan
Agreement);

       

      4.2 Any
representation or warranty of the Borrower in any Loan Document shall prove to
have been incorrect in any material respect when made;

       

      4.3 The
failure by the Borrower to observe or perform any of its Obligations hereunder
for ten (10) days after receipt by the Borrower of notice of such failure from
the Lender; and

       

      ARTICLE
V Duty To
Hold In Trust.  Upon the
occurrence of any Event of Default and at any time thereafter, the Borrower
shall, upon receipt by it of any revenue, income or other sums subject to the
Security Interest, whether payable pursuant to the Note or otherwise, or of any
check, draft, note, trade acceptance or other instrument evidencing an
obligation to pay any such sum, hold the same in trust for the Lender and shall
forthwith endorse and transfer any such sums or instruments, or both, to the
Lender for application to the satisfaction of the Obligations.

       

      ARTICLE
VI Rights
and Remedies Upon Default.  Upon occurrence
of any Event of Default and at any time thereafter, the Lender shall have the
right to exercise all of the remedies conferred hereunder and under the Note,
and the Lender shall have all the rights and remedies of a Lender under the UCC
and/or any other applicable law (including the Uniform Commercial Code of any
jurisdiction in which any Collateral is then located).  Without
limitation, the Lender shall have the following rights and powers:

       

      
        
           

        

        
          B-5

          
            

          

        

        
           

        

      

      6.1 The
Lender shall have the right to take possession of the Collateral and, for that
purpose, enter, with the aid and assistance of any person, any premises where
the Collateral, or any part thereof, is or may be placed and remove the same,
and the Borrower shall assemble the Collateral and make it available to the
Lender at places which the Lender shall reasonably select, whether at the
Borrower’s premises or elsewhere, and make available to the Lender, without
rent, all of the Borrower’s respective premises and facilities for the purpose
of the Lender taking possession of, removing or putting the Collateral in
saleable or disposable form.

       

      6.2 The
Lender shall have the right, but not the obligation, to operate the business of
the Borrower using the Collateral and shall have the right to assign, sell,
lease or otherwise dispose of and deliver all or any part of the Collateral, at
public or private sale or otherwise, either with or without special conditions
or stipulations, for cash or on credit or for future delivery, in such parcel or
parcels and at such time or times and at such place or places, and upon such
terms and conditions as the Lender may deem commercially reasonable, all without
(except as shall be required by applicable statute and cannot be waived)
advertisement or demand upon or notice to the Borrower or right of redemption of
the Borrower, which are hereby expressly waived.  Upon each such sale,
lease, assignment or other transfer of Collateral, the Lender may, unless
prohibited by applicable law which cannot be waived, purchase all or any part of
the Collateral being sold, free from and discharged of all trusts, claims, right
of redemption and equities of the Borrower, which are hereby waived and
released.

       

      6.3 The
Lender shall have the right to require Borrower to, and Borrower shall be
obliged to, immediately take such steps as may be necessary to perfect Lender’s
first priority interest in all  Cash Equivalents under the UCC,
including, without limitation, the execution of a lock-box agreement in such
form as may be reasonably required by Lender with any and all banks at which
Borrower holds any Cash Equivalents giving Lender control over such Cash
Equivalents.

       

      ARTICLE
VII Applications
of Proceeds.  The proceeds of
any such sale, lease or other disposition of the Collateral hereunder shall be
applied first, to the expenses of retaking, holding, storing, processing and
preparing for sale, selling, and the like (including, without limitation, any
taxes, fees and other costs incurred in connection therewith) of the Collateral,
to the reasonable attorneys’ fees and expenses incurred by the Lender in
enforcing its rights hereunder and in connection with collecting, storing and
disposing of the Collateral, and then to satisfaction of the Obligations, and to
the payment of any other amounts required by applicable law, after which the
Lender shall pay to the Borrower any surplus proceeds.  If, upon the
sale, license or other disposition of the Collateral, the proceeds thereof are
insufficient to pay all amounts to which the Lender is legally entitled, the
Borrower will be liable for the deficiency, together with interest thereon, at
the rate of 25% per annum (the “Default Rate”), and
the reasonable fees of any attorneys employed by the Lender to collect such
deficiency.  To the extent permitted by applicable law, the Borrower
waives all claims, damages and demands against the Lender arising out of the
repossession, removal, retention or sale of the Collateral, unless due to the
gross negligence or willful misconduct of the Lender.

       

      
        
           

        

        
          B-6

          
            

          

        

        
           

        

      

      ARTICLE
VIII Costs and
Expenses. The Borrower agrees to pay all out-of-pocket fees, costs
and expenses incurred in connection with any filing required hereunder,
including without limitation, any financing statements, continuation statements,
partial releases and/or termination statements related thereto or any expenses
of any searches reasonably required by the Lender.  The Borrower shall
also pay all other claims and charges which in the reasonable opinion of the
Lender might prejudice, imperil or otherwise affect the Collateral or the
Security Interest therein.  The Borrower will also, upon demand, pay
to the Lender the amount of any and all reasonable expenses, including the
reasonable fees and expenses of its counsel and of any experts and agents, which
the Lender may incur in connection with (i) the enforcement of
this Agreement, (ii) the custody or
preservation of, or the sale of, collection from, or other realization upon, any
of the Collateral, or (iii) the exercise or
enforcement of any of the rights of the Lender under the Note.  Until
so paid, any fees payable hereunder shall be added to the principal amount of
the Note and shall bear interest at the Default Rate.

       

      ARTICLE
IX Responsibility
for Collateral.  The Borrower
assumes all liabilities and responsibility in connection with all Collateral,
and the Obligations of the Borrower hereunder or under the Loan Documents shall
in no way be affected or diminished by reason of the loss, destruction, damage
or theft of any of the Collateral or its unavailability for any
reason.

       

      ARTICLE
X Security
Interest Absolute.  All rights of the
Lender and all Obligations of the Borrower hereunder, shall be absolute and
unconditional, irrespective of: (a) any lack of validity
or enforceability of any Loan Document or any agreement entered into in
connection with the foregoing, or any portion hereof or thereof; (b) any change in the
time, manner or place of payment or performance of, or in any other term of, all
or any of the Obligations, or any other amendment or waiver of or any consent to
any departure from the Loan Documents or any other agreement entered into in
connection with the foregoing; (c)  any exchange,
release or nonperfection of any of the Collateral, or any release or amendment
or waiver of or consent to departure from any other collateral for, or any
guaranty, or any other security, for all or any of the Obligations; (d) any action by the
Lender to obtain, adjust, settle and cancel in its sole discretion any insurance
claims or matters made or arising in connection with the Collateral; or (e) any other
circumstance which might otherwise constitute any legal or equitable defense
available to the Borrower, or a discharge of all or any part of the Security
Interest granted hereby.  Until the Obligations shall have been paid
and performed in full, the rights of the Lender shall continue even if the
Obligations are barred for any reason, including, without limitation, the
running of the statute of limitations or bankruptcy.  The Borrower
expressly waives presentment, protest, notice of protest, demand, notice of
nonpayment and demand for performance.  In the event that at any time
any transfer of any Collateral or any payment received by the Lender hereunder
shall be deemed by final order of a court of competent jurisdiction to have been
a voidable preference or fraudulent conveyance under the bankruptcy or
insolvency laws of the United States, or shall be deemed to be otherwise due to
any party other than the Lender, then, in any such event, the Borrower’s
Obligations hereunder shall survive cancellation of this Agreement, and shall
not be discharged or satisfied by any prior payment thereof and/or cancellation
of this Agreement, but shall remain a valid and binding obligation enforceable
in accordance with the terms and provisions hereof.  The Borrower
waives all right to require the Lender to proceed against any other person or to
apply any Collateral which the Lender may hold at any time, or to marshal
assets, or to pursue any other remedy.  The Borrower waives any
defense arising by reason of the application of the statute of limitations to
any obligation secured hereby.

       

      
        
           

        

        
          B-7

          
            

          

        

        
           

        

      

      ARTICLE
XI Term of
Agreement.  This Agreement
and the Security Interest shall terminate on the date on which all payments
under the Note have been made in full and all other Obligations have been paid
or discharged.  Upon such termination, the Lender, at the request and
at the expense of the Borrower, will join in executing any termination statement
with respect to any financing statement executed and filed pursuant to this
Agreement.

       

      ARTICLE
XII Power of Attorney; Further
Assurances.

       

      12.1 The
Borrower authorizes the Lender, and does hereby make, constitute and appoint it,
and its respective officers, agents, successors or assigns with full power of
substitution, as the Borrower’s true and lawful attorney-in-fact, with power, in
its own name or in the name of the Borrower, to, after the occurrence and during
the continuance of an Event of Default, (i) endorse any notes, checks,
drafts, money orders, or other instruments of payment (including payments
payable under or in respect of any policy of insurance) in respect of the
Collateral that may come into possession of the Lender; (ii) to sign and
endorse any UCC financing statement or any invoice, freight or express bill,
bill of lading, storage or warehouse receipts, drafts against debtors,
assignments, verifications and notices in connection with accounts, and other
documents relating to the Collateral; (iii) to pay or discharge taxes,
liens, security interests or other encumbrances at any time levied or placed on
or threatened against the Collateral; (iv) to demand, collect, receipt for,
compromise, settle and sue for monies due in respect of the Collateral; and
(v) generally, to do, at the option of the Lender, and at the Borrower’s
expense, at any time, or from time to time, all acts and things which the Lender
deems necessary to protect, preserve and realize upon the Collateral and the
Security Interest granted therein in order to effect the intent of the Loan
Documents, all as fully and effectually as the Borrower might or could do; and
the Borrower hereby ratifies all that said attorney shall lawfully do or cause
to be done by virtue hereof.  This power of attorney is coupled with
an interest and shall be irrevocable for the term of this Agreement and
thereafter as long as any of the Obligations shall be outstanding.

       

      12.2 On
a continuing basis, the Borrower will make, execute, acknowledge, deliver, file
and record, as the case may be, in the proper filing and recording places in any
jurisdiction, all such instruments, and take all such action as may reasonably
be deemed necessary or advisable, or as reasonably requested by the Lender, to
perfect the Security Interest granted hereunder and otherwise to carry out the
intent and purposes of this Agreement, or for assuring and confirming to the
Lender the grant or perfection of a security interest in all the
Collateral.

       

      12.3 The
Borrower hereby irrevocably appoints the Lender as the Borrower’s
attorney-in-fact, with full authority in the place and stead of the Borrower and
in the name of the Borrower, from time to time in the Lender’s discretion, to
take any action and to execute any instrument which the Lender may deem
necessary or advisable to accomplish the purposes of this Agreement, including
the filing, in its sole discretion, of one or more financing or continuation
statements and amendments thereto, relative to any of the Collateral without the
signature of the Borrower where permitted by law.

       

      ARTICLE
XIII Notices.  All notices,
requests, demands and other communications hereunder shall be in writing, with
copies to all the other parties hereto, and shall be deemed to have been duly
given when (i) if
delivered by hand, upon receipt, (ii) if sent by
facsimile, upon receipt of proof of sending thereof, (iii) if sent by
nationally recognized overnight delivery service (receipt requested), the next
business day or (iv) if mailed by
first-class registered or certified mail, return receipt requested, postage
prepaid, four days after posting in the U.S. mails, in each case if delivered to
the following addresses:

       

      
        
           

        

        
          B-8

          
            

          

        

        
           

        

      

      If
to the Lender, as follows:

      Centaur Farms of Southern
California

      Attn:  Mr. Gary Cropp,
President

      P.O. Box 675645

      14725 Rancho Santa Fe Farms
Road

      Rancho Santa Fe, CA 92067

      

               With
a copy to:

      Stanley M. Moskowitz,
Esq.

      de Castro,P.C.

      309
Laurel Street

      San
Diego, CA 92101

      FAX:  619-702-9401

      

               If
to the Borrower, as follows:

      US
Farms, Inc.

      1635 Rosecrans Street, Suite
C

      San Diego, CA 92106

      FAX: 858-488-2828

      

               With
a copy to:

      ___________________________

      ___________________________

      ___________________________

      

       

      ARTICLE
XIV Other
Security.  To the extent
that the Obligations are now or hereafter secured by property other than the
Collateral or by the guarantee, endorsement or property of any other person,
firm, corporation or other entity, then the Lender shall have the right, in its
sole discretion, to pursue, relinquish, subordinate, modify or take any other
action with respect thereto, without in any way modifying or affecting any of
the Lender’s rights and remedies hereunder.

       

      ARTICLE
XV Severability. In the event that any
provision of this Agreement is invalid or unenforceable under any applicable
statute or rule of law, then such provision shall be deemed inoperative to the
extent that it may conflict therewith and shall be deemed modified to conform
with such statute or rule of law.  Any such provision which may prove
invalid or unenforceable under any law shall not affect the validity or
enforceability of any other provision of this Note.

       

      
        
           

        

        
          B-9

          
            

          

        

        
           

        

      

      ARTICLE
XVI Miscellaneous.

       

      16.1 No
course of dealing between the Borrower and the Lender, nor any failure to
exercise, nor any delay in exercising, on the part of the Lender, any right,
power or privilege hereunder or under the Note shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, power or
privilege hereunder or thereunder preclude any other or further exercise thereof
or the exercise of any other right, power or privilege.

       

      16.2 All
of the rights and remedies of the Lender with respect to the Collateral, whether
established hereby or by the Note or by any other agreements, instruments or
documents or by law shall be cumulative and may be exercised singly or
concurrently.

       

      16.3 This
Agreement constitutes the entire agreement of the parties with respect to the
subject matter hereof and is intended to supersede all prior negotiations,
understandings and agreements with respect thereto.  Except as
specifically set forth in this Agreement, no provision of this Agreement may be
modified or amended except by a written agreement specifically referring to this
Agreement and signed by the parties hereto.

       

      16.4 In
the event that any provision of this Agreement is held to be invalid, prohibited
or unenforceable in any jurisdiction for any reason, unless such provision is
narrowed by judicial construction, this Agreement shall, as to such
jurisdiction, be construed as if such invalid, prohibited or unenforceable
provision had been more narrowly drawn so as not to be invalid, prohibited or
unenforceable.  If, notwithstanding the foregoing, any provision of
this Agreement is held to be invalid, prohibited or unenforceable in any
jurisdiction, such provision, as to such jurisdiction, shall be ineffective to
the extent of such invalidity, prohibition or unenforceability without
invalidating the remaining portion of such provision or the other provisions of
this Agreement and without affecting the validity or enforceability of such
provision or the other provisions of this Agreement in any other
jurisdiction.

       

      16.5 No
waiver of any breach or default or any right under this Agreement shall be
considered valid unless in writing and signed by the party giving such waiver,
and no such waiver shall be deemed a waiver of any subsequent breach or default
or right, whether of the same or similar nature or otherwise.

       

      16.6 This
Agreement shall be binding upon and inure to the benefit of each party hereto
and its successors and assigns.

       

      16.7 Each
party shall take such further action and execute and deliver such further
documents as may be necessary or appropriate in order to carry out the
provisions and purposes of this Agreement.

       

      16.8 This
Agreement shall be construed in accordance with the laws of the State of
California, except to the extent the validity, perfection or enforcement of a
security interest hereunder in respect of any particular Collateral which are
governed by a jurisdiction other than the State of California in which case such
law shall govern.  Each of the parties hereto irrevocably submit to
the exclusive jurisdiction of any California or United States Federal court
sitting in San Diego County over any action or proceeding arising out of or
relating to this Agreement, and the parties hereto hereby irrevocably agree that
all claims in respect of such action or proceeding may be heard and determined
in such California or Federal court.  The parties hereto agree that a
final judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law.  The parties hereto further waive any objection to
venue in the State of  California and any objection to an action or
proceeding in the State of California on the basis of forum non
conveniens.

       

      
        
           

        

        
          B-10

          
            

          

        

        
           

        

      

      16.9 EACH
PARTY HERETO HEREBY AGREES TO WAIVE ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY
CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS
AGREEMENT.  THE SCOPE OF THIS WAIVER IS INTENDED TO BE ALL
ENCOMPASSING OF ANY DISPUTES THAT MAY BE FILED IN ANY COURT AND THAT RELATE TO
THE SUBJECT MATER OF THIS AGREEMENT, INCLUDING WITHOUT LIMITATION CONTRACT
CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS AND ALL OTHER COMMON LAW AND
STATUTORY CLAIMS.  EACH PARTY HERETO ACKNOWLEDGES THAT THIS WAIVER IS
A MATERIAL INDUCEMENT FOR EACH PARTY TO ENTER INTO A BUSINESS RELATIONSHIP, THAT
EACH PARTY HAS ALREADY RELIED ON THIS WAIVER IN ENTERING INTO THIS AGREEMENT AND
THAT EACH PARTY WILL CONTINUE TO RELY ON THIS WAIVER IN THEIR RELATED FUTURE
DEALINGS. EACH PARTY FURTHER WARRANTS AND REPRESENTS THAT IT HAS REVIEWED THIS
WAIVER WITH ITS LEGAL COUNSEL, AND THAT SUCH PARTY HAS KNOWINGLY AND VOLUNTARILY
WAIVES ITS RIGHTS TO A JURY TRIAL FOLLOWING SUCH CONSULTATION.  THIS
WAIVER IS IRREVOCABLE, MEANING THAT, NOTWITHSTANDING ANYTHING HEREIN TO THE
CONTRARY, IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING, AND THIS WAIVER
SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS AND SUPPLEMENTS OR
MODIFICATIONS TO THIS AGREEMENT.  IN THE EVENT OF A LITIGATION, THIS
AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE
COURT.

       

      16.10 This
Agreement may be executed in any number of counterparts, each of which when so
executed shall be deemed to be an original and, all of which taken together
shall constitute one and the same Agreement.  In the event that any
signature is delivered by facsimile transmission, such signature shall create a
valid binding obligation of the party executing (or on whose behalf such
signature is executed) the same with the same force and effect as if such
facsimile signature were the original thereof.

       

      (Signatures
on Next Page)

       

      

      
        
           

        

        
          B-11

          
            

          

        

        
           

        

      

       

      IN
WITNESS WHEREOF, the parties hereto have caused this Security Agreement to be
duly executed on the day and year first above written.

       

      LENDER:                                                                                     BORROWER:

      

      CENTAUR
FARMS OF
SOUTHERN                                           US
FARMS, INC.

      CALIFORNIA,
INC.                                                                      a
Nevada corporation

      a
California corporation

      

      

      By/s/ Gary
Cropp                                                                           
By: /s/ Yan
Skwara

               Gary
Cropp,
President                                                                     
Yan K. Skwara, CEO

      

      

      

       

      

       

      

       

      

       

      
        
          
             

            

          

           

        

        
          B-12

          
            

          

        

        
           

        

      

      EXHIBIT
C

      STOCK
PLEDGE AGREEMENT

      

      This Pledge Agreement made this 1st day
of May 2008 by and among Centaur Farms of Southern California, Inc., a
California corporation ("Lender"),  US Farms, Inc., a Nevada
corporation ("Borrower"), Yan K.
Skwara, an individual (“Pledgor”), and de Castro, P.C., a California
professional law corporation, as escrow agent ("'Escrow Agent").

      

      WHEREAS, Lender has loaned or will loan
to Borrower a total of $125,000 (the "Principal Sum") pursuant to the terms of a
Loan Agreement of even date hereof;

      

      WHEREAS, Borrower has issued a secured
promissory note (the "Note") of even date herewith in the which Note bears
interest at the rate of 20% per annum; and

      

      WHEREAS, Pledgor is a substantial
stockholder and has a substantial financial stake in the Borrower and will
substantially benefit from the Loan Agreement and Note;

      

      WHEREAS, to induce Lender to lend
Borrower the Principal Sum, Pledgor has agreed to pledge 12,500,000 shares of
Series C Preferred Stock, (which is convertible into 12,500,000 shares of common
stock) in Borrower as collateral for the repayment of the Note and all other
obligations, which shares are represented by the stock certificates listed on
Appendix "A", attached hereto (the "Shares"), and

      

      WHEREAS, the Shares are to be held in
in escrow pursuant to an Escrow Agreement referenced in the Loan
Agreement.

      

      NOW THEREFORE, the parties hereto agree
and acknowledge that the foregoing recitals are true and correct and to the
following:

      

      1.      Payment of
Indebtedness. Borrower hereby agrees pay to Lender the sum of $125,000,
plus accrued interest and any costs in accordance with the terms of the Note,
and to satisfy any other obligations under any Loan Document (as defined in the
Loan Agreement).

      

      2.      Pledge of Collateral.
As collateral security for the repayment all indebtedness under the Loan
Documents, the Pledgor hereby pledges and grants to the Lender a security
interest in and to the Shares, as identified in Appendix A, and any and all
stock rights, powers and other distributions, dividends or proceeds thereof. In
addition, any stock rights, dividends, powers or other distributions or proceeds
received by the Pledgor shall be held in escrow for and delivered to the Lender
to be held in accordance with the terms of the Escrow Agreement, and shall be
included in the Shares described above.  Pledgor consents to the
Lender jointly receiving the Shares and acknowledge that in the event of
default, as defined in Section 7 below, Lender may sell the Shares in either
Lender' name, and distribute the proceeds thereof as set forth below, in
addition to any other remedies available to them.

      

      
        
           

        

        
          C-1

          
            

          

        

        
           

        

      

      3.      Delivery of the
Shares. The Shares shall be delivered to the Escrow Agent, together with
undated stock powers executed in blank. The Shares shall be held and delivered
by the Escrow Agent in accordance with the terms of the Escrow Agreement to be
executed by all parties concurrently with this Agreement.

      

      4.      Pledgor's and Borrower’s
Warranties and Indemnity.

      

      4.1           Each
of Pledgor and Borrower represents, warrants and covenants (a) that Pledgor is
the lawful owner of the Shares, (b) that the Shares are fully paid and
nonassessable, (c) that as of the date hereof, the Shares are free and clear of
all liens, encumbrances, security, interests or other restrictions, and this
pledge constitutes a valid and perfected first priority security interest in the
Shares enforceable against the Pledgor, (d) that the Shares are not subject to
any outstanding rights of redemption or options to purchase or sell except as
set forth in the Company's Certificate of Incorporation and By-laws, (e) that
the Pledgor has the sole right and lawful authority to pledge the Shares and
otherwise to comply with the provisions hereof, (f) no litigation is
pending or threatened against the Pledgor, which if adversely determined, would
have a material adverse effect against the Pledgor or the Lender' rights in
respect of the Shares, (g) that the Pledgor agrees to defend the Lender' title
in the Shares and the security interest therein against any and all claims and
demands, (h) this Agreement constitutes the legal, valid and binding obligation
of the Pledgor, enforceable against the Pledgor in accordance with its terms,
and, (i) the Pledgor has received adequate consideration for the pledge of the
Shares and acknowledges that Lender would not make the Loan if Pledgor did not
pledge the Shares.

      

      4.2           If
any adverse claim is asserted in respect of the Shares or any portion thereof,
except as such may arise from the wanton, reckless or unauthorized acts of the
Lender, each of Pledgor and Borrower agrees to indemnify the Lender and hold the
Lender harmless from and against any reasonable liabilities or damages, and
reasonable attorney's fees incurred by the Lender in exercising any right, power
or remedy of the Lender hereunder. Any such loss, liability or expense so
incurred shall be paid by the Pledgor upon demand, become part of the
Indebtedness secured by the Shares and bear interest at the rate of 25% per
annum.

      

      5.      Voting of Collateral.
While Borrower is not in default in the payments under the Notes, Pledgor may
vote the Shares, provided that said voting shall be in conformity with the
Pledgor's performance under this Agreement and the Note.

      

      
        
           

        

        
          C-2

          
            

          

        

        
           

        

      

      6.      Dividends and Other
Distributions. While Borrower is not in default hereunder, Pledgor may
receive all cash dividends, payments of principal and interest, and other
distributions payable with respect to Shares, provided, however, that Pledgor
shall immediately inform Lender of the receipt of any such dividend, payment or
other distribution and shall deliver such dividend, payment or other
distribution to the Escrow Agent, unless and until Lender shall in writing
release Pledgor from making such delivery to the Escrow Agent. Pledgor shall
cause all non-cash dividends and distributions with respect to Shares to be
distributed directly to the Escrow Agent, to be held by Escrow Agent as
additional security, and if any such distribution is made to Pledgor they shall
receive such distribution in trust for Lender and shall immediately deliver it
to Escrow Agent.

      

      7.      Default.  Borrower
shall be in default hereunder upon the occurrence of any of the following
events:

      

      (a) Any event of default shall occur
under any Loan Document;

      

      (b) If Borrower or the Pledgor is not
paying debts as they become due, becomes insolvent, files or has filed against
any of them a petition under any chapter of the United States Bankruptcy Code,
11 U.S.C. ss. 101 et seq. (or any similar petition under any insolvency law of
any jurisdiction), proposes any liquidation, composition or financial
reorganization with his creditors, makes an assignment or trust mortgage for the
benefit of creditors, or if a receiver, trustee, custodian or similar agent is
appointed or takes possession with respect to any
property or business of Borrower, or Pledgor;

      

      (c) If any lien, encumbrance or adverse
claim of any nature whatsoever is asserted with respect to any
Shares;

      

      (d) If any representation or warranty
of Borrower or the Pledgor hereunder is or shall become false;

      

      (e) If Borrower or Pledgor fails to
fulfill any obligation hereunder;

      

      (f) If Borrower or Pledgor fails to pay
any indebtedness or perform any of the  obligations when such payment
or performance is due,

      

      8.      Lender' Rights upon
Default. Upon the occurrence of any default as defined in Section 7
hereof, Lender may notify the Escrow Agent of such default. Escrow Agent shall
comply with the terms of the Escrow Agreement and deliver the Shares to the
Lender then Lender may elect, in their sole discretion, to take any one or more
of the following actions:

      

      
        
           

        

        
          C-3

          
            

          

        

        
           

        

      

      8.1           at
any time and from time to time sell, assign and deliver all or any part of the
Shares, or any interest therein, at any public or private sale, for cash, on
credit or for other property, for immediate or future delivery without any
assumption of credit risk, and for such price or prices and on such terms as
Lender in their absolute discretion may determine; provided that (i) at least
five (5) days' notice of the time and place of any such sale shall be given to
Guarantor and Pledgor, and (ii) in the case of any sale, such notice shall also
contain the terms of the proposed sale and Lender shall sell the Shares proposed
to be sold to any purchaser procured by Pledgor who is ready, willing and able
to purchase, and who prior to the time of such sale tenders the purchase price
of, such Shares on terms more favorable to Lender than the terms contained in
such notice; provided, further, the Pledgor acknowledges that the Lender may be
unable to effect a public sale of all or part of the Shares by reason of certain
prohibitions contained in the Securities Act of 1933, as amended, and may be
compelled to resort to one or more private sales to a restricted group of
purchasers who 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. The Pledgor acknowledges that any such private
sale may be at prices and on terms less favorable to the seller than if sold at
public sales and that private sales shall be deemed to be made in a commercially
reasonable manner notwithstanding that such a private sale may result in a lower
sale price.

      

      8.2           exercise
the right to vote, the right to receive cash dividends and other distributions,
and all other rights with respect to the Shares as though Lender was the
absolute owner thereof, whether or not such rights were retained by Pledgor as
against Lender before default; and

      

      8.3           exercise
all other rights available to a secured party under the Uniform Commercial Code
and other applicable law. The rights and remedies available pursuant to the
Agreement are cumulative, and not exclusive of any other rights or remedies
otherwise available to the Lender.

      

      9.      Application of Sale
Proceeds. In the event of a sale of Shares, the proceeds shall first be
applied to the payment of the expenses of the sale, including brokers'
commissions, counsel fees, any taxes or other charges imposed by law upon the
Shares or the transfer thereof and all other charges paid or incurred by Lender
pertaining to the sale; and, second, to satisfy outstanding indebtedness, and,
third, the surplus (if any) shall be paid to Pledgor.

      

      10.    Notices. Any notice
or request hereunder may be given to a party hereto at the respective addresses
set forth below or as may hereafter be specified in a notice designated as a
change of address under this Section. Any notice or request hereunder shall be
given by registered or certified mail, return receipt requested, hand delivery,
overnight mail or telecopy (confirmed by mail), Notices and requests shall be,
in the case of those by hand delivery, deemed to have been given when delivered
to any party to whom it is addressed, in the case of those by mail or overnight
mail, deemed to have been given three (3) Business Days after the date when
deposited in the mail or with the overnight mail carrier, and, in the case of a
telecopy, when confirmed.

      

      
        
           

        

        
          C-4

          
            

          

        

        
           

        

      

      LENDER:

      

      Centaur Farms of Southern California,
Inc.

                 Attention:  Gary
Cropp, President

      P.O. Box 675645

      14725 Rancho Santa Fe Farms
Road

      Rancho Santa Fe, CA 92067

      

      BORROWER:                                           

      

      US
Farms, Inc.

      1635 Rosecrans Street, Suite
C

      San Diego, CA 92106

      FAX: 858-488-2828

      

      PLEDGOR:

      

      Yan K.
Skwara

      1635 Rosecrans Street, Suite
C

      San Diego, CA
92106

      

      or
such other address as
may be designated in writing hereafter.

      

      11.    Heirs, Successors,
Etc. This Agreement and all of its terms and provisions shall benefit and
bind the heirs, successors, assigns, transferees, executors and administrators
of each of the parties hereto.

      

      12.    Lender' Forbearance.
Any forbearance, failure or delay by Lender in exercising any right, power or
remedy hereunder shall not be deemed a waiver of such right, power or remedy.
Any single or partial exercise of any right, power or remedy of Lender shall
continue in full force and effect until such right, power or remedy is
specifically waived in writing by Lender.

      

      13.    Further Assurances.
The Pledgor covenants and agrees to execute and deliver, or cause to be executed
or delivered, all such other stock powers, proxies, instruments, UCC 1 Financing
Statements and documents, and will take such other action or actions as the
Lender may reasonably request from time to time in order to perfect its first
priority security interest in the Shares and to carry out the provisions and
purposes hereof.

      

      14.    Termination. This
Agreement and the pledge and security interest represented hereby shall
terminate upon the indefeasible payment in full of the Note and the satisfaction
by Borrower and/or Pledgor of all of their obligations under the Loan
Documents.

      

      
        
           

        

        
          C-5

          
            

          

        

        
           

        

      

      15.    Miscellaneous. (a)
This Agreement or any part thereof cannot be changed, waived, or amended except
by an instrument in writing signed by Lender; and waiver on one occasion shall
not operate as a waiver on any other occasion. (b) The Uniform Commercial Code
and other laws of the State of California shall govern the construction and
enforcement of this Agreement. (c) If any part of this Agreement or any
agreement, document, or instrument executed in connection herewith shall be
deemed invalid or unenforceable by a court of competent jurisdiction, the
remaining provisions shall remain in full force and effect, and shall continue
to be binding upon the parties. (d) This Agreement may be executed in one or
more counterparts, each of which shall constitute an original, but all of which,
when taken together, shall constitute one and the same instrument.

      

      16.    Jurisdiction. Each of
the Borrower and Pledgor irrevocably submits to the jurisdiction of the courts
of the State of California and the United States District Court for the Southern
District of California for the purpose of any suit, action or other proceeding
brought by the Lender arising out of or relating to this Agreement, and each of
the Borrower or Pledgor waives and agrees not to assert by way of motion, as a
defense or otherwise in any such suit, action or proceeding, any claim that the
Borrower or the Pledgor are not personally subject to the jurisdiction of the
courts of the State of California or the United States District Court for the
Southern District of California that the Borrower's or the Pledgor's property is
exempt or immune from execution or attachment, either prior to judgment or in
aid of execution, that the suit, action or proceeding is brought in an
inconvenient forum or that the venue of the suit, action or proceeding is
improper, or that this Agreement or the subject matter hereof may not be
enforced in or by such court.

      

      EACH
OF THE BORROWER AND THE PLEDGOR HEREBY WAIVES ANY AND ALL RIGHTS TO A TRIAL BY
JURY IN ANY ACTION OR PROCEEDING IN CONNECTION WITH ALL MATTERS CONTEMPLATED
HEREBY AND DOCUMENTS EXECUTED IN CONNECTION HEREWITH.

      

      17.    Construction. The
parties have participated jointly in the negotiation and drafting of this
Agreement. 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.
Any reference to any federal, state, local or foreign statute shall be deemed to
refer to all rules and regulations promulgated thereunder, unless the context
requires otherwise. The word "including" means including, without
limitation.

      

      18.    Severability.  In
the event that any provision of this Agreement is invalid or unenforceable under
any applicable statute or rule of law, then such provision shall be deemed
inoperative to the extent that it may conflict therewith and shall be deemed
modified to conform with such statute or rule of law.  Any such
provision which may prove invalid or unenforceable under any law shall not
affect the validity or enforceability of any other provision of this
Note.

       

      
        
           

        

        
          C-6

          
            

          

        

        
           

        

      

      IN WITNESS
WHEREOF, this Agreement has been duly executed and delivered by the duly
authorized officer of each party hereto as of the date first above
written.

       

      CENTAUR
FARMS OF SOUTHERN CALIFORNIA,

      a
California corporation

      

      By:/s/ Gary
Cropp                                                                           

      Gary
Cropp, President

      

      

      US
FARMS, INC.,

      a
Nevada corporation

      

      By:
/s/ Yan
Skwara                                                                           

      Yan
K. Skwara, President

      

      

      

      /s/ Yan
Skwara                                                                           

      Yan
K. Skwara, an individual as Pledgor

      

      
        
          
             

            

          

           

        

        
          C-7

          
            

          

        

        
           

        

      

      EXHIBIT
D

      ESCROW
AGREEMENT

      

      This Escrow Agreement made this 1st
day of May, 2008, by and between Centaur Farms of Southern California, Inc., a
California corporation (hereinafter referred to
as “Lender”), US Farms, Inc., a Nevada corporation (“Borrower”), Yan Skwara, an
individual (“Pledgor)” and de Castro P.C. a California Professional Corporation
(“Escrow Agent”)  In this agreement, Borrower and Pledgor are
sometimes referred to as the “Parties.”

      

      WHEREAS, Pledgor is a major stockholder
and Chief Executive Officer and President of Borrower, and Borrower has borrowed
funds from Lender pursuant to the terms of a Loan Agreement of even date
hereof;

      

      WHEREAS, the Parties have entered into
a Pledge Agreement dated the 2nd day of May, 2008, (the “Pledge Agreement”) (all
capitalized terms herein shall have the have the meaning set forth in the Loan
Agreement); and

      

      WHEREAS, for valuable consideration,
the Pledgor has agreed that shares of Common Stock of Borrower (the “Escrow
Shares”) currently beneficially owned by Pledgor shall be placed in escrow with
the Escrow Agent pursuant to Pledge Agreement;

      

      NOW, THEREFORE, in consideration of
the mutual covenants, terms and conditions hereinafter set forth, the parties
hereto hereby agree as follows:

      

      1.      Deposit of Escrow Shares;
Duties of Escrow Agent. Upon receipt of the stock certificates set forth
on Appendix “A” to the Pledge Agreement (the “Certificates”) representing the
Escrow Shares, Pledgor shall immediately deposit the Certificates with the
Escrow Agent.  In addition, Pledgor shall deposit with the Escrow
Agent duly executed Stock Powers, endorsed in blank for the
Certificates.  Escrow Agents sole responsibility shall be to hold the
Escrow Shares and Stock Powers pursuant to this Agreement and to perform only
such duties as are expressly provided for under this Agreement.

      

      2.      Duration of Escrow
Period.   The Escrow Period shall commence on the date
upon which the Escrow Shares are received by the Escrow Agent and shall
terminate at 5 .00 P.M. PDT on the 120th day
following the date of this Agreement (the “Termination Date”), unless sooner
terminated in accordance with this Agreement.

      

      3.      Release and Delivery of
Escrow Shares.

      

       a) In the event that Borrower
shall pay to Lender all amounts due to Lenders pursuant to the Agreement on the
Termination Date, or sooner,  then the Escrow Agent shall deliver the
Escrow Shares to Pledgor, and Escrow Agent’s obligations under this Agreement
shall be terminated.

      

      
        
           

        

        
          D-1

          
            

          

        

        
           

        

      

       b) In the event that the Lender
is not paid all amounts due by the Termination Date or there is otherwise an
event of default, as set forth in any Loan Document, and Escrow Agent shall have
received notice in writing of such non-payment or other default (the “Notice of
Default”) by the Lenders, then the Escrow Agent shall, within five (5) days
after the receipt of the Notice of Default, deliver the Escrow Shares to the
Lenders, provided however that the Lenders shall have, on the same date as they
send the Notice of Default to the Escrow Agent, had sent a copy of such Notice
of Default  to the Borrower and the  Pledgor at the
addresses set forth below.  Upon release of the Escrow Shares in
accordance with this Paragraph, Escrow Agent’s obligations under this Agreement
shall be terminated.

       

      4.      Non-transferability of
Escrow Shares. During the Escrow Period, none of the Escrow Shares
deposited in the Escrow Account shall be sold, pledged, hypothecated or
otherwise transferred or delivered out of the Escrow Account.

      

      5.      Receipt of Distributions and
Dividends.  During the term of the Escrow Period, if US Farms,
Inc. (“USFI”) issues any distributions, dividends, rights or other property with
respect to the Escrow Shares, or in the event of a share split,
recapitalization, or other transaction affecting the capitalization of the USFI,
then, in such event, USFI shall be authorized to send evidence of such
distributions, dividends, rights, share certificates or other property directly
to the Escrow Agent, who is hereby authorized to hold and retain possession of
all such evidences of distributions, dividends, rights or other property until
termination of the Escrow Period. Upon termination of the Escrow Period, the
Escrow Agent is hereby authorized, empowered and instructed to deliver all such
evidences of distributions, dividends, rights, Common Stock or other property to
Lenders or Pledgor, as the case may be.

      

      6.      Limitation of Liability of
Escrow Agent.  In acting pursuant to this Agreement, the Escrow
Agent shall be protected fully in every exercise of its discretion and shall
have no obligation hereunder to the Parties or to any other party except as
expressly set forth herein.  In performing any of his duties
hereunder, the Escrow Agent shall not incur any liability to any person for any
damages, losses or expenses, except for willful default or gross negligence and
it shall, accordingly, not incur any such liability with respect to (1) any
action taken or omitted in good faith relating to the duties and
responsibilities of the Escrow Agent under this Agreement, and (2) any action
taken or omitted in reliance upon any instrument, including written notices
provided for herein, not only to its due execution and validity and
effectiveness of its provisions, but also to the truth and accuracy of any
information contained therein, which the Escrow Agent shall in good faith
believe to be genuine, to have been signed and presented by a proper person or
persons and to be in compliance with the provisions of this
Agreement.

      

      7.      Indemnification.  The
Parties, jointly and severally, shall indemnify and hold harmless the Escrow
Agent against any and all losses, claims, damages, liabilities and expenses,
including reasonable costs of investigation and counsel fees and disbursements,
which may be imposed upon the Escrow Agent or incurred by the Escrow Agent in
connection with his acceptance of appointment as Escrow Agent or the performance
of his duties hereunder, including any litigation arising from this Agreement or
involving the subject matter hereof.

       

      8.      Payment of
Fees.  The Parties, jointly and severally, shall be responsible
for all reasonable fees (at its standard hourly rates) and expenses of the
Escrow Agent incurred by it in the course of performing hereunder.

      

      
        
           

        

        
          D-2

          
            

          

        

        
           

        

      

      9.      Change of Escrow
Agent.  Escrow Agent may resign from its duties hereunder with
ten (10) days prior written notice to the other parties. In the event the Escrow
Agent notifies the Parties that its acceptance of the duties of Escrow Agent has
been terminated by the Escrow Agent, or in the event the Escrow Agent files for
protection under the United States Bankruptcy Code or is liquidated or ceases
operations for any reason, the Parties shall have the right to jointly designate
a replacement Escrow Agent who shall succeed to the rights and duties of the
Escrow Agent hereunder.  Any such replacement Escrow Agent shall be a
trust or stock transfer company experienced in stock transfer, escrow and
related matters. Upon appointment of such successor Escrow Agent, the Escrow
Agent shall be discharged from all duties and responsibilities
hereunder.

      

      10.    Notices.  All
notices, demands or requests required or authorized hereunder shall be deemed
given sufficiently if in writing and sent by registered mail or certified mail,
return receipt requested and postage prepaid, or by tested telex, telegram or
cable to, in the case of the Stockholder, the address as set forth in the
records of the Escrow Agent;

      

      LENDERS                   Centaur
Farms of Southern California, Inc.

      Attention: Gary Cropp,
President

      P.O. Box 675645

      14725
Rancho Santa Fe Farms Road

      Rancho
Santa Fe, CA 92067

      

      BORROWER              US
Farms, Inc.

      1635
Rosecrans Street, Suite C

      San Diego, CA 92106

      

      

      PLEDGOR                  Yan
K. Skawara

      1635 Rosecrans Street, Suite
C

      San
Diego, CA 92106

      

      

      ESCROW
AGENT      de Castro P.C.

      309 Laurel Street

      San Diego, CA 92101

      Attention: Audie de Castro,
Esq.

      

      or such
other address as may be designated in writing hereafter.

      

      12.    Counterparts.  This
Agreement may be executed in counterparts, each of which shall be an original,
but all of which together shall constitute one and the same
Agreement.  Facsimile signatures shall be accepted by the parties
hereto as original signatures for all purposes.

      

      
        
           

        

        
          D-3

          
            

          

        

        
           

        

      

      13.    Governing Law;
Venue.  The validity, interpretation and construction of this
Agreement and of each part hereof shall be governed by the laws of the State of
California.  All actions and proceedings arising in connection with
this Agreement must be tried and litigated exclusively in the State and Federal
courts located in the County of San Diego, State of California, which courts
have personal jurisdiction and venue over each of the parties to this Agreement
for the purpose of adjudicating all matters arising out of or related to this
Agreement.  Each party authorizes and accepts service of process
sufficient for personal jurisdiction in any action against it as contemplated by
this paragraph by registered or certified mail, return receipt requested,
postage prepaid, to its address for the giving of notices set forth in this
Agreement.

      

      14.    Disputes.  In
the event of a dispute, Escrow Agent shall have the right, but not the
obligation, to:  (a) refrain from taking any action other than to
continue holding the Escrow Shares and/or Stock Powers pending a joint written
instruction from all affected parties; (b) commence an interpleader action or
similar action, suit or proceeding for the resolution of the dispute; and/or (c)
deposit the Escrow Shares and Stock Power, as the case may be, with any court of
competent jurisdiction in the State of California, in which case Escrow Agent
shall give written notice to the other parties.  In such event, Escrow
Agent is authorized to comply with and obey any court orders.  Escrow
Agent has the right to retain counsel to advise it on any matters relating to a
dispute, and the parties shall, jointly and severally, bear the reasonable fees
and costs associated therewith.

      

      15.    Acknowledgement.  The
parties acknowledge that Escrow Agent is also counsel to Lenders (and no other
party) and may continue to act in such capacity, even as Escrow Agent performs
its duties hereunder.  All parties agree that Escrow Agent shall be
permitted to act as counsel for the Company with respect to any matter, or any
dispute as to the disposition of the Escrow Shares and in any other dispute or
matter between the Parties, whether or not Escrow Agent still has duties
hereunder.

      
 

      

      

      (Signatures
on Next Page)

      

      

      

      

      

      
        
           

        

        
          D-4

          
            

          

        

        
           

        

      

      

      

      

      

                IN
WITNESS WHEREOF, the Parties have executed this Escrow Agreement on the day and
year first above written to be effective as of the Effective Date.

      

      CENTAUR
FARMS OF SOUTHERN CALIFORNIA, INC.

      a
California corporation,

      

      By:
/s/ Gary
Cropp                                                                

      Gary Cropp, President

      

      US
FARMS, INC.,

      a
Nevada corporation

      

      /s/ Yank
Skwara                                                                

      YAN
K. SKWARA, individual and as

      Pledgor

      

      ACCEPTANCE OF DUTIES BY
ESCROW AGENT:

      DE
CASTRO P.C.

      a
California professional corporation. as Escrow Agent

      

      By:
/s/ Audie de
Castro                                                                

      Audie
de Castro, President

      

      
        
          
             

            

          

           

        

        
          D-5

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