EXECUTION
COPY

    


    NOTE AND WARRANT
PURCHASE AGREEMENT

     

    This NOTE
AND WARRANT PURCHASE
AGREEMENT (this “Agreement”) is
entered into as of October 7, 2010, by and between Umami Sustainable Seafood
Inc., a Nevada corporation, trading on the OTC Bulletin Board under the symbol
“UMAM” (the “Company”), and UTA
Capital LLC, a Delaware limited liability company (“Purchaser”).

     

    WITNESSETH:

     

    WHEREAS,
the Company desires to issue and sell to the Purchaser, and the Purchaser
desires to purchase from the Company, senior secured bridge notes, substantially
in the form of Exhibit
A-1 (the “First
Note”) and Exhibit A-2 (the
“Second Note”)
attached hereto (each such note, a “Note” and
collectively, the “Notes”), the First
Note in the principal amount of $2,500,000 maturing on March 31, 2011 and the
Second Note in the principal amount of $3,125,000 maturing on March 31, 2012,
for an aggregate principal amount of $5,625,000 (the “Principal
Amount”);

     

    WHEREAS,
to induce Purchaser to purchase the Notes, the Company has agreed to issue to
Purchaser a warrant (the “Warrant”) to purchase
shares of the Company’s common stock, $.001 par value per share (the “Common Stock”), in
accordance with the terms set forth in the form of warrant attached hereto as
Exhibit B (the
“Warrant”).

     

    NOW,
THEREFORE, in consideration of the mutual covenants and agreements hereinafter
set forth herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby mutually acknowledged, the parties agree as
follows:

     

    1.         Sale and
Purchase of the Notes and Warrant.

     

    1.1       Sale and Issuance of
Notes.  Subject to the terms and conditions of this Agreement,
Purchaser agrees to purchase at Closing (as defined below), and the Company
agrees to sell and issue to Purchaser the Notes for an aggregate purchase price
of $5,000,000 (the “Purchase
Price”).

     

    1.2       Issuance of
Warrant.  Subject to the terms and conditions of this
Agreement, the Company shall issue to Purchaser at the Closing (as defined
below) a Warrant to initially purchase up to 2,981,000 shares of Common Stock
(but in no event less or more, as of the date of the original issuance of the
Warrant, than 4.99% of the sum of (x) the number of currently issued and
outstanding shares of the Common Stock, plus, without duplication, (y) the
number of additional shares of Common Stock of the Company or Common Stock
Equivalents (as defined below) as may as of the date of the original issuance of
the Warrant or thereafter be issued or issuable to the seller or beneficial
owners of the seller at the closing of the Baja Acquisition (as defined below),
and (z) the number of additional shares of Common Stock issuable upon exercise
in full of the Warrant).  Of the total number of shares issuable upon
exercise of the Warrant, a number of shares as is in excess of 4.99% of the sum
of (x) the number of currently issued and outstanding shares of the Common
Stock, plus (y) the number of additional shares of Common Stock issuable upon
exercise in full of the Warrant, shall not be issuable upon exercise of the
Warrant until six months after the Closing Date.

     

    
      
         


      

      
         


        
          

        

      

      
         


      

    

     

    2.        Closing.

     

    2.1      Time and Place. The
closing for the sale and purchase of the Notes and Warrant shall take place at
the offices of Seyfarth Shaw LLP, 620 Eighth Avenue, New York, NY 10018, at
10:00 a.m., local time, on the second business day after all of the conditions
set forth in Section 7 hereof have been duly satisfied or waived, or at such
later time or date as Purchaser and the Company may mutually agree in writing
(the “Closing”).  The
date upon which the Closing shall occur is herein called the “Closing Date”. On the
Closing Date, Purchaser shall pay the Purchase Price to the Company via federal
funds wire transfer(s) of immediately available funds, in accordance with
written instructions provided to Purchaser prior to the date
hereof.

     

    3.        Company
Pledge and Security Agreements; Subsidiary Guarantees and Collateral
Agreements.

     

    3.1      Company Pledge and Security
Agreement with Respect to Bluefin Shares and Company Accounts
Receivable.  At Closing, the Company shall enter into a Pledge
and Security Agreement, substantially in the form of Exhibit C attached
hereto (the “Company
Bluefin Pledge and Security Agreement”),

     

    (i)           pledging,
as security in favor of Purchaser for the obligations of the Company under the
Notes, all of the shares of capital stock of Bluefin Acquisition Group Inc., a
New York corporation and wholly-owned subsidiary of the Company (“Bluefin”) presently
owned or hereinafter acquired, either directly or indirectly, by the Company,
representing 100% of the issued and outstanding shares of capital stock of
Bluefin (the “Bluefin
Pledge”), which Bluefin Pledge shall be released promptly upon the
occurrence of both of the following: (i) the number of shares of Baja validly
pledged as part of the Baja Pledge (as defined below) reaching 99.984% of the
issued and outstanding shares of capital stock of Baja and (ii) the execution by
the Subsidiaries and the delivery to Purchaser of the Collateral Agreements (as
defined below) and the performance by the Subsidiaries of their respective
closing obligations set forth therein; and

     

    (ii)          granting,
as additional security in favor of Purchaser for the obligations of the Company
under the Notes, a first priority perfected security interest in and lien on any
and all of the Company’s inventory, whether presently owned or hereinafter
acquired, and any proceeds arising in connection with the sale or disposition of
such inventory (the “Company
Inventory”).

     

    3.2      Company Pledge Agreement
with Respect to Baja Shares.  At Closing, the Company shall
enter into a Pledge Agreement, substantially in the form of Exhibit D attached
hereto (the “Company
Baja Pledge Agreement,” together with the Company Bluefin Pledge and
Security Agreement, hereinafter, collectively, referred to as the “Company Pledge and Security
Agreement”), pledging, as security in favor of Purchaser for the
obligations of the Company under the Notes, all of the shares of capital stock
of Baja Aqua-Farms S.A. de C.V., a subsidiary of the Company (“Baja”) presently
owned or hereinafter acquired, either directly or indirectly, by the Company,
currently representing 33% of the issued and outstanding shares of capital stock
of Baja (the “Baja
Pledge”).

     

    
      
         


      

      
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    3.3      Baja Subsidiary Guarantee
Agreement.  At Closing, the Company shall cause Baja to enter
into a Subsidiary Guarantee Agreement, substantially in the form of Exhibit E attached
hereto (the “Baja
Subsidiary Guarantee Agreement”), guaranteeing the payment of all of the
Company’s obligations under this Agreement, the Notes, the Warrant, the Company
Pledge and Security Agreement, the Bluefin Subsidiary Guarantee (as defined
below), Kali Subsidiary Security Agreement (as defined below), the Baja
Subsidiary Security Agreement, or any other agreement executed in connection
with the transactions contemplated herein (collectively referred to as the
“Transaction
Documents”).

     

    3.4      Bluefin Subsidiary Guarantee
Agreement.  At Closing, the Company shall cause Bluefin to
enter into a Subsidiary Guarantee Agreement, substantially in the form of Exhibit F attached
hereto (the “Bluefin  Subsidiary
Guarantee”),

     

    (i)           guaranteeing
all of the Company’s obligations under the Transaction Documents;
and

     

    (ii)          agreeing
not to transfer, pledge or encumber any shares of capital stock of Kali
presently owned or hereinafter acquired, either directly or indirectly, by
Bluefin without the prior written consent of Purchaser unless such transfer,
pledge or encumbrance is contemplated by Transaction Documents.

     

    3.5      Baja Subsidiary Security
Agreement.   In accordance with Section 6.2(f) of this
Agreement, the Company shall cause Baja to enter into a Security Agreement (the
“Baja Subsidiary
Security Agreement”),

     

    (i)           granting
to Purchaser, as security in favor of Purchaser for the obligations of Baja
under the Baja Subsidiary Guarantee Agreement, a first priority perfected
security interest in and lien on that portion of Baja’s then owned or thereafter
acquired, inventory, the value of which, when aggregated with the value of that
portion of the Kali Inventory (as defined below) designated by Purchaser in its
sole discretion to be included in the Collateral (as defined below), shall in no
event be less than three times the sum of the Principal Amount and accrued
interest under the Notes, and any proceeds arising in connection with the sale
or disposition of such inventory (the “Baja Inventory”),
provided however, that if the Company, after fully satisfying its obligations
under the First Note, thereafter elects to use operating cash flow for purposes
of repaying its loan obligations to Atlantis Group HF (“Atlantis”) in
accordance with Section 6.2(a)(ii)
herein, the aggregate value of the inventory comprising the Baja Inventory and
Kali Inventory shall be increased to be equal to no less than four times the sum
of the then outstanding Principal Balance and accrued interest under the
Notes;

     

    (ii)         agreeing
not to transfer, pledge or encumber any of the Baja Inventory comprising the
Collateral without the prior written consent of Purchaser unless such transfer,
pledge or encumbrance is contemplated by the Transaction Documents;
and

     

    (iii)         permitting
Purchaser, subject to the satisfaction or release of then-existing encumbrances
by applicable third parties, to select in its sole discretion, and vary from
time to time, the proportion of the Baja Inventory that will comprise the
minimum Collateral required hereunder.

     

    
      
         


      

      
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    3.6      Kali Subsidiary Security
Agreement.  In accordance with Section 6.2(f) of this
Agreement,  the Company shall cause Kali Tuna d.o.o., a Croatian
limited liability company (“Kali”) to enter into
a Security Agreement (the “Kali Subsidiary Security
Agreement, and together with the Baja Subsidiary and Security Agreement,
the “Collateral
Agreements”),

     

    (i)           granting
to Purchaser, as security in favor of Purchaser for the obligations of the
Company under the Transaction Documents, a first priority perfected security
interest in and lien on that portion of Kali’s then owned or thereafter
acquired, inventory, the value of which, when aggregated with the value of that
portion of the Baja Inventory designated by Purchaser in its sole discretion to
be included in the Collateral, shall in no event be less than three times the
sum of the Principal Balance and accrued interest under the Notes, and any
proceeds arising in connection with the sale or disposition of such inventory
(the “Kali
Inventory,” together with the Company Inventory, Bluefin Pledge, Baja
Pledge and the Baja Inventory hereinafter, collectively, referred to as the
“Collateral”)),
provided however, that if the Company, after fully satisfying its obligations
under the First Note, elects to use operating cash flow for purposes of repaying
its loan obligations to Atlantis in accordance with Section 6.2(a)(ii)
herein, the aggregate value of inventory comprising the Kali Inventory and Baja
Inventory shall be increased to equal no less than four times the sum of the
then outstanding Principal Balance and accrued interest under the
Notes;

     

    (ii)          agreeing
not to transfer, pledge or encumber any of the Kali Inventory comprising the
Collateral without the prior written consent of Purchaser unless such transfer,
pledge or encumbrance is contemplated by the Transaction Documents;
and

     

    (iii)         permitting
Purchaser, subject to the satisfaction or release of then-existing encumbrances
by applicable third parties, to select in its sole discretion, and vary from
time to time, the proportion of the Kali Inventory that will comprise the
minimum Collateral required hereunder.

     

    4.        Representations
and Warranties of the Company.  The Company
hereby represents and warrants to Purchaser as follows (which representations
and warranties shall be deemed to apply, where appropriate, to the following
direct or indirect subsidiaries of the Company: Bluefin, Baja and
Kali  (each a “Subsidiary” and
collectively, the “Subsidiaries”)), as
of the Closing Date:

     

    4.1      Subsidiaries.  The
Company has no subsidiaries other than Bluefin, Baja, Kali and Oceanic
Enterprises, Inc., a California corporation.  Except as disclosed in
Schedule 4.1 or
as specifically disclosed in the SEC Reports (as hereinafter defined) hereto,
the Company owns, directly or indirectly, all of the capital stock or comparable
equity interests of each Subsidiary  free and clear of any lien,
charge, claim, security interest, encumbrance, right of first refusal or other
restriction (each, a “Lien”) (other than
Liens in favor of Purchaser) and all the issued and outstanding shares of
capital stock or comparable equity interest of each Subsidiary are validly
issued, fully paid and non-assessable and free of preemptive and similar
rights.

     

    
      
         


      

      
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    4.2      Organization and
Qualification.  Each of the  Company and the
Subsidiaries is an entity duly organized, validly existing and in good standing
under the laws of the jurisdiction of its respective incorporation or
organization (as applicable), with the requisite legal authority to own and use
its properties and assets and to carry on its business as currently
conducted.  Neither the Company nor any Subsidiary is in violation of
any of the provisions of its respective certificate or articles of
incorporation, bylaws or other organizational or charter
documents.  The Company and the Subsidiaries are each duly qualified
to do business and in good standing as a foreign corporation or other entity in
each jurisdiction in which the nature of the business conducted or property
owned by it makes such qualification necessary, except where the failure to be
so qualified or in good standing, as the case may be, would not, individually or
in the aggregate, have or reasonably be expected to result in a (a) a material
adverse effect on the results of operations, assets, prospects, business
condition (financial or otherwise) of the Company and the Subsidiaries, taken as
a whole, (b) a material and adverse impairment of the Company’s and the
Subsidiaries’ ability to perform its obligations under any of the Transaction
Documents, or (c) a material and adverse effect on the legality, validity or
enforceability of any of the Transaction Documents (a “Material Adverse
Effect”); provided, however, that no
change, effect, event or occurrence to the extent arising or resulting from any
of the following, either alone or in combination, shall constitute or be taken
into account in determining whether there has been or will be, a Material
Adverse Effect: (i) general business or economic conditions not specific or
peculiar to the Company or any Subsidiary, (ii) acts of war or terrorism or
natural disasters not specific or peculiar to the Company, a Subsidiary or a
jurisdiction in which any of them operates, (iii) catastrophic economic or
significant regulatory or political conditions or changes, (iv) changes in any
applicable accounting regulations or principles or the interpretations thereof,
(vi) changes in laws, or (vii) changes in the price or trading volume of the
Company’s stock.

     

    4.3      Authorization;
Enforcement.  The Company and each Subsidiary has the requisite
corporate authority to enter into and to consummate the transactions
contemplated by the Transaction Documents to which it is a party and otherwise
to carry out its respective obligations hereunder and thereunder.  The
execution and delivery of the Transaction Documents by the Company or any
Subsidiary and the consummation of the transactions contemplated hereby and
thereby have been duly authorized by all necessary corporate action on the part
of the Company and each Subsidiary and no further consent or action is required
by the Company, the Subsidiaries or their respective Board of Directors (or
similar governing body) or shareholders.  The Transaction Documents to
which they are a party have been duly executed by the Company and the
Subsidiaries, as applicable, and when delivered in accordance with the terms
hereof, will constitute, the valid and binding obligation of the Company and the
Subsidiaries, as applicable, enforceable against the Company and the
Subsidiaries, as applicable, in accordance with their respective terms, except
as the same may be limited by (a) applicable bankruptcy, insolvency,
reorganization or other laws of general application relating to or affecting the
enforcement of creditors rights generally, and (b) the effect of rules of law
governing the availability of specific performance and other equitable
remedies.

     

    
      
         


      

      
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    4.4      No
Conflicts.  Except as disclosed in Schedule 4.4,
the execution, delivery and performance of the Transaction Documents by the
Company and the Subsidiaries, as applicable, and the consummation by the Company
and the Subsidiaries, as applicable, of the transactions contemplated hereby and
thereby do not, and will not, (a) conflict with or violate any provision of the
Company’s or any Subsidiary’s memorandum or articles of association, certificate
or articles of incorporation, bylaws or other organizational or charter
documents, (b) conflict with, or constitute a default (or an event that with
notice or lapse of time or both would become a default) under, or give to others
any rights of termination, amendment, acceleration or cancellation (with or
without notice, lapse of time or both) of, any agreement, credit facility, debt
or other instrument (evidencing a Company or Subsidiary debt or otherwise) or
other understanding to which the Company or any Subsidiary is a party or by
which any property or asset of the Company or any Subsidiary is bound, or
affected, (c) except for Liens granted pursuant to the Transaction Documents,
result in any Lien on assets or on property of the Company, or (d) result in a
violation of any law, rule, regulation, order, judgment, injunction, decree or
other restriction of any court or governmental authority to which the Company or
a Subsidiary is subject (including, assuming the accuracy of the representations
and warranties of Purchaser set forth in Section 5.2
hereof, federal and state securities laws and regulations and the rules and
regulations of any self-regulatory organization to which the Company or its
securities are subject, including any market (such as the OTC Bulletin Board or
Pink Sheets LLC) on which the shares of Common Stock are listed or quoted for
trading on the date in question, as applicable (the “Trading Markets”)),
or by which any property or asset of the Company or a Subsidiary is bound or
affected.

     

    4.5      The Securities. The
Notes, the Warrant and the equity securities issuable upon exercise thereof (collectively,
the “Securities”) are duly
authorized and, when issued and paid for in accordance with the Transaction
Documents, will be duly and validly issued, fully paid and nonassessable, free
and clear of all Liens and will not be subject to preemptive or similar rights
of stockholders (other than those imposed by Purchaser).  The Company
has reserved from its duly authorized shares of common stock the maximum number
of securities issuable upon exercise of the Warrant (the “Warrant
Shares”).  The shares of Common Stock initially issuable upon
exercise of the Warrants will, immediately following the Closing under this
Agreement, represent not less than or more than 4.99% of the sum of (x) the
number of currently issued and outstanding shares of the Common Stock, plus,
without duplication, (y) the number of additional shares of Common Stock of the
Company or Common Stock Equivalents as may be issued or issuable to the seller
or beneficial owners of the seller at the closing of the Baja Acquisition and
(z) the number of additional shares of Common Stock issuable upon exercise in
full of the Warrant.  The offer, issuance and sale of the Note, the
Warrant and the Warrant Shares pursuant to the Transaction Documents are exempt
from the registration requirements of the Securities Act of 1933, as amended
(the “Securities
Act”).

     

    4.6      Capitalization.

     

    (i) As of
the date of this Agreement, the aggregate number of shares and type of all
authorized, issued and outstanding classes of shares, options and other
securities of the Company and the Subsidiaries (whether or not presently
convertible into or exercisable or exchangeable for shares of the Company and
the Subsidiaries) is set forth in Schedule 4.6
hereto.  All outstanding shares are duly authorized, validly issued,
fully paid and nonassessable and have been issued in compliance in all material
respects with all applicable securities laws.  The Company and the
Subsidiaries have outstanding only those options, warrants, script rights to
subscribe to, calls or commitments of any character whatsoever relating to, or
securities, rights or obligations convertible into or exercisable or
exchangeable for, or entered into any agreement giving any Person (as defined in
Section 4.30 hereof) any right to subscribe for or acquire, any shares of
capital stock of the Company or the Subsidiaries, or securities or rights
convertible or exchangeable into shares of capital stock of the Company or the
Subsidiaries as set forth on Schedule 4.6.

     

    
      
         


      

      
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    (ii) Except as set forth on Schedule 4.6
hereto, and except for customary adjustments as a result of share dividends,
share splits, combinations of shares, reorganizations, recapitalizations,
reclassifications or other similar events, there are no anti-dilution or price
adjustment provisions contained in any security issued or agreement entered into
by the Company or the Subsidiaries (or in any agreement providing rights to
security holders) and the issuance and sale of the Securities will not obligate
the Company or the Subsidiaries to issue shares of common stock or other
securities to any Person (other than Purchaser) and will not result in a right
of any holder of securities to adjust the exercise, conversion, exchange or
reset price under such securities.  To the Knowledge (as hereinafter
defined) of the Company, except as disclosed in Schedule 4.6
hereto and except for the Company’s ownership of the Subsidiaries, no Person or
group of related Persons beneficially owns (as determined pursuant to Rule 13d-3
under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), or
has the right to acquire, by agreement with or by obligation binding upon the
Company or the Subsidiaries, a beneficial ownership interest in the Company or
the Subsidiaries in excess of 5% of the outstanding capital stock of such
entity. “Knowledge” means the actual knowledge (i.e., the conscious awareness of
facts and other information) of the chief executive officer, chief financial
officer or other key officers of the Company, after undertaking a customary and
reasonable investigation under the circumstances.

     

    4.7      SEC Reports; Financial
Statements; No Material Adverse Effect; Solvency.  Except as
set forth on Schedule 4.7 or
as specifically disclosed in the SEC Reports, the Company has filed all reports
required to be filed by it under the Exchange Act, including pursuant to
Section 13(a) or 15(d) thereof, since June 30, 2010 on a timely basis or
has received a valid extension of such time of filing and has filed any such SEC
Reports prior to the expiration of any such extension.  Such reports
required to be filed by the Company under the Exchange Act after June 30, 2010,
including pursuant to Section 13(a) or 15(d) thereof, and including all
Current Reports on Form 8-K describing the proposed acquisition by the Company
of the outstanding capital stock of Baja that is not presently owned by the
Company (the “Baja
Acquisition”), together with any materials filed or furnished by the
Company under the Exchange Act, whether or not any such reports were required,
are collectively referred to herein as the “SEC Reports” (which
SEC Reports shall include, for the avoidance of doubt, the draft 10-K provided
by Company to Purchaser) and, together with this Agreement and the schedules to
this Agreement, the “Disclosure
Materials”.  As of their respective dates, the SEC Reports
filed by the Company complied in all material respects with the requirements of
the Securities Act and the Exchange Act and the rules and regulations of the
U.S. Securities and Exchange Commission (the “SEC”) promulgated
thereunder, and none of the SEC Reports, when filed by the Company, contained
any untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading.  The financial statements of the Company included in the
SEC Reports comply in all material respects with applicable accounting
requirements and the rules and regulations of the SEC with respect thereto as in
effect at the time of filing.  Such financial statements have been
prepared in accordance with United States generally accepted accounting
principles applied on a consistent basis during the periods involved (“GAAP”), except as may
be otherwise specified in such financial statements, the notes thereto and
except that unaudited financial statements may not contain all footnotes
required by GAAP or may be condensed or summary statements, and fairly present
in all material respects the consolidated financial position of the Company and
its consolidated Subsidiaries as of and for the dates thereof and the results of
operations and cash flows for the periods then ended, subject, in the case of
unaudited statements, to normal, year-end audit adjustments.  All
material agreements to which the Company or any Subsidiary is a party or to
which the property or assets of the Company or any Subsidiary are subject are
included as part of or identified in the SEC Reports, to the extent such
agreements are required to be included or identified pursuant to the rules and
regulations of the SEC.

     

    
      
         


      

      
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    Since the
date of the latest audited financial statements included within the SEC Reports,
except as disclosed in Schedule 4.7
hereto, (i) there has been no event, occurrence or development that,
individually or in the aggregate, has had or that would result in, or reasonably
be expected to result in a Material Adverse Effect, (ii) the Company and
Subsidiaries have not incurred any material liabilities other than (A) trade
payables and accrued expenses incurred in the ordinary course of business
consistent with past practice, (B) liabilities not required to be reflected in
the Company’s and/or Subsidiary’s financial statements pursuant to GAAP or not
required to be disclosed in filings made with the SEC and (C) other liabilities
incurred by the Subsidiaries for the exclusive purpose of funding the day-to-day
operations of the fish farming sites of the Company’s operating subsidiaries,
(iii) the Company has not altered its method of accounting or changed its
auditors, (iv) the Company and the Subsidiaries have not declared or made any
dividend or distribution of cash or other property to their shareholders, in
their capacities as such, or purchased, redeemed or made any agreements to
purchase or redeem any shares of its capital stock (except for repurchases by
the Company  and/or the Subsidiaries of shares of capital stock held
by employees, officers, directors, or consultants pursuant to an option of the
Company and/or the Subsidiaries to repurchase such shares upon the termination
of employment or services), and (v) the Company and/or the Subsidiaries have not
issued any equity securities to any officer, director or affiliate, except
pursuant to existing Company stock-based plans.  The Company and the
Subsidiaries have not taken any steps to seek protection pursuant to any
bankruptcy law nor does the Company have any Knowledge or reason to believe that
its creditors intend to initiate involuntary bankruptcy proceedings or any
Knowledge of any fact which would reasonably lead a creditor to do
so.  The Company and the Subsidiaries will not be Insolvent (as
defined below) after giving effect to the transactions contemplated hereby to
occur at the Closing.  For purposes of this Section 4.7,
“Insolvent”
means that (i) the present fair saleable value of the Company’s assets is less
than the amount required to pay the Company’s total Indebtedness (as defined in
Section 4.30
hereof), (ii) the Company is unable to pay its debts and liabilities,
subordinated, contingent or otherwise, as such debts and liabilities become
absolute and matured, (iii) the Company intends to incur or believes that it
will incur debts that would be beyond its ability to pay as such debts mature,
or (iv) the Company has unreasonably small capital with which to conduct the
business in which it is engaged as such business is now conducted and is
proposed to be conducted.

     

    4.8     Absence of
Litigation.  Except as described in Schedule 4.8 or
as specifically disclosed in the SEC Reports, there is no action, suit, claim,
or Proceeding (as defined below), or, to the Company’s Knowledge, inquiry or
investigation, before or by any court, public board, government agency,
self-regulatory organization or body pending or, to the Knowledge of the
Company, threatened against or affecting the Company or any of its Subsidiaries
that could, individually or in the aggregate, have a Material Adverse Effect.
For the purposes hereof, “Proceeding” means an
action, claim, suit, investigation or proceeding (including, without limitation,
a partial proceeding, such as a deposition), whether commenced or threatened in
writing.

     

    
      
         


      

      
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    4.9      Compliance.  Except
as described in Schedule 4.9,
neither the Company nor any Subsidiary, except in each case as would not,
individually or in the aggregate, reasonably be expected to have or result in a
Material Adverse Effect, (a) is in default under or in violation of (and no
event has occurred that has not been waived that, with notice or lapse of time
or both, would result in a default by the Company or any Subsidiary under), nor
has the Company or any Subsidiary received written notice of a claim that it is
in default under or that it is in violation of, any indenture, loan or credit
agreement or any other agreement or instrument to which it is a party or by
which it or any of its properties is bound (whether or not such default or
violation has been waived), (b) is in violation of any order of any court,
arbitrator or governmental body, or (c) is or has been in violation of any
statute, rule or regulation of any governmental authority.

     

    4.10    Title to
Assets.  The Company and the Subsidiaries own or lease no real
property except as described in Schedule 4.10.  The
Company and the Subsidiaries have good and marketable title in all personal
property owned by them that is material to the business of the Company and the
Subsidiaries, in each case free and clear of all Liens, except for Liens in
favor of Purchaser and other Liens that could not if enforced, individually or
in the aggregate, have or result in a Material Adverse Effect.  Any
real property and facilities held under lease by the Company and the
Subsidiaries are held by them under valid, subsisting and enforceable leases as
to which the Company and the Subsidiaries are in material
compliance.

     

    4.11    Significant
Customers. Schedule 4.11
lists each customer who represented 10% or more of the sales of the Company or
of any Subsidiary during the calendar year ended June 30, 2010 (each, a “Significant
Customer“) and the percentage of the Company’s total revenues such
Significant Customer represented during such period.  The Company has
no outstanding material dispute concerning its business operations with any
Significant Customer.  No Significant Customer has given notice to the
Company, whether orally or in writing, that such customer shall not continue as
a customer of the Company after Closing or that such customer intends to
terminate or materially modify existing agreements with the Company at any
time.

     

    4.12    No General Solicitation;
Placement Agent’s Fees.  Neither the Company, nor, to the
Company’s Knowledge, any of its affiliates, nor any Person acting on its or
their behalf, has engaged in any form of general solicitation or general
advertising (within the meaning of Regulation D of the Securities Act) in
connection with the offer or sale of the Securities.  The Company
shall be responsible for the payment of any placement agent’s fees, financial
advisory fees, or brokers’ commission (other than for Persons engaged by
Purchaser) relating to or arising out of the issuance of the Securities pursuant
to this Agreement.  The Company shall pay, and hold Purchaser harmless
against, any liability, loss or expense (including, without limitation,
reasonable attorney’s fees and out-of-pocket expenses) arising in connection
with any such claim for fees arising out of the issuance of the Securities
pursuant to this Agreement.

     

    4.13    Private
Placement.  Neither the Company nor, to the Company’s
Knowledge, any of its Affiliates nor, any Person acting on the Company’s behalf
has, directly or indirectly, made any offer or sale of any security or
solicitation of any offer to buy any security under circumstances that would (i)
eliminate the availability of the exemption from registration under Regulation D
under the Securities Act in connection with the offer and sale by the Company of
the Securities as contemplated hereby, or (ii) cause the offering of the
Securities pursuant to the Transaction Documents to be integrated with prior
offerings by the Company for purposes of any applicable law, regulation or
stockholder approval provisions, including, without limitation, under the rules
and regulations of any Trading Market.  The sale and issuance of the
Securities hereunder does not contravene the rules and regulations of any
Trading Market on which the Common Stock is listed or quoted.

     

    
      
         


      

      
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    4.14    Company not an “Investment
Company”. The Company is not required to be registered as, and is not an
Affiliate of, an “investment company” within the meaning of the Investment
Company Act of 1940, as amended (the “Investment Company
Act”).

     

    4.15    Form S-1/S-3
Eligibility.  The Company is eligible to register the Warrant
Shares for resale by Purchaser using Form S-1 promulgated under the Securities
Act.

     

    4.16    Listing and Maintenance
Requirements.  Except as described in Schedule 4.16,
the Company has not, since June 30, 2010, received notice (written or oral) from
any Trading Market on which the Common Stock is or has been listed or quoted to
the effect that the Company is not in compliance with the listing or maintenance
requirements of such Trading Market.  The Company is, and has no
reason to believe that it will not in the foreseeable future continue to be, in
material compliance with all such listing and maintenance
requirements.  The issuance of the Securities does not require
stockholder approval, including without limitation under NASDAQ Marketplace Rule
5635, and the failure to obtain such stockholder approval will not materially
impair the prospects of approval of any future listing application with
NASDAQ.

     

    4.17    Registration
Rights.  Except as provided for in this Agreement, as described
in Schedule 4.17 or
as specifically disclosed in the SEC Reports, the Company has not granted or
agreed to grant to any Person any rights (including “piggy-back”
registration rights) to have any securities of the Company registered with the
SEC or any other governmental authority that have not been satisfied or
waived.

     

    4.18    Application of Takeover
Protections.  Except as described in Schedule 4.18 or
as specifically disclosed in the SEC Reports, there is no control share
acquisition, business combination, poison pill (including any distribution under
a rights agreement) or other similar anti-takeover provision under the Company’s
charter documents or the laws of its state of incorporation that is or could
become applicable to Purchaser as a result of Purchaser and the Company
fulfilling their obligations or exercising their rights under the Transaction
Documents, including, without limitation, as a result of the Company’s issuance
of the Securities and Purchaser’s ownership of the Securities.

     

    4.19    Disclosure.  All
disclosure provided by the Company to Purchaser regarding the Company, its
business and the transactions contemplated hereby, including the schedules to
this Agreement, furnished by or on behalf of the Company are true and correct in
all material respects and do not contain any untrue statement of material fact
or omit to state any material fact necessary in order to make the statements
made therein, in the light of the circumstances under which they were made, not
misleading.  Except for the transactions contemplated by this
Agreement, no event or circumstance has occurred or information exists with
respect to the Company or any of its Subsidiaries or its or their business,
properties, operations or financial condition, which, under applicable law, rule
or regulation, requires public disclosure or announcement by the Company but
which has not been so publicly announced or disclosed.  The Company
acknowledges and agrees that Purchaser is not making and has not made any
representations or warranties with respect to the transactions contemplated
hereby other than those set forth in the Transaction Documents.

     

    
      
         


      

      
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    4.20    Acknowledgment Regarding
Purchaser’s Purchase of Securities.  Based upon the assumption
that the transactions contemplated by this Agreement are consummated in all
material respects in conformity with the Transaction Documents, the Company
acknowledges and agrees that Purchaser is acting solely in the capacity of an
arm’s length purchaser with respect to the Transaction Documents and the
transactions contemplated hereby and thereby.  The Company further
acknowledges that Purchaser is not acting as a financial advisor or fiduciary of
the Company (or in any similar capacity) with respect to this Agreement and the
transactions contemplated hereby and any advice given by Purchaser or any of its
respective representatives or agents in connection with the Transaction
Documents and the transactions contemplated hereby and thereby is merely
incidental to Purchaser’ purchase of the Securities.  The Company
further represents to Purchaser that the Company’s decision to enter into this
Agreement has been based solely on the independent evaluation of the
transactions contemplated hereby by the Company and its
representatives.

     

    4.21    Patents and
Trademarks.  Except as described in Schedule 4.21 or
as specifically disclosed in the SEC Reports, (a) the Company and its
Subsidiaries owns or possesses sufficient rights to conduct its business in the
ordinary course, including, without limitation, rights to use all material
patents, patent rights, industry standards, trademarks, copyrights, licenses,
inventions, trade secrets, trade names and know-how (collectively, “Intellectual Property
Rights”) as owned or possessed by them or that are necessary for the
conduct of its business as now conducted or as proposed to be conducted except
where the failure to currently own or possess such rights would not have a
Material Adverse Effect, (b) neither the Company nor any of its Subsidiaries is
infringing any rights of a third party with respect to any Intellectual Property
Rights that, individually or in the aggregate, would have a Material Adverse
Effect, and, since January 1, 2008, neither the Company nor any of its
Subsidiaries has received any notice of, or has any Knowledge of, any asserted
infringement by the Company or any of its Subsidiaries of, any rights of a third
party with respect to any Intellectual Property Rights that, individually or in
the aggregate, would have a Material Adverse Effect and (c) since January 1,
2008, neither the Company nor any of its Subsidiaries has received any notice
of, or has any Knowledge of, infringement by a third party with respect to any
Intellectual Property Rights of the Company or of any Subsidiary that,
individually or in the aggregate, would have a Material Adverse
Effect.  The Company has not used Publicly Available Software (as
hereinafter defined) in whole or in part in the development of any part of its
Intellectual Property Rights in a manner that would be reasonably likely to
subject the Company or its Intellectual Property Rights in whole or in part, to
all or part of the license obligations of any Publicly Available Software that,
individually or in the aggregate, would have a Material Adverse Effect on the
Company.  “Publicly Available
Software” means each of (i) any software that contains, or is derived in
any manner (in whole or in part) from, any software that is distributed as free
software, open source software (e.g., Linux), or similar
licensing and distribution models; and (ii) any software that requires as a
condition of use, modification, and/or distribution of such software that such
software or other software incorporated into, derived from, or distributed with
such software (A) be disclosed or distributed in source code form; (B) be
licensed for the purpose of making derivative works; or (C) be redistributable
at no or minimal charge.  Publicly Available Software includes,
without limitation, software licensed or distributed under any of the following
licenses or distribution models similar to any of the following: (a) GNU General
Public License (GPL) or Lesser/Library GPL (LGPL), (b) the Artistic License
(e.g. PERL), (c) the Mozilla Public License, (d) the Netscape Public License,
(e) the Sun Community Source License (SCSL), the Sun Industry Source License
(SISL), and the Apache Server License.

     

    
      
         


      

      
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    4.22    Insurance.  The
Company and, to the Company’s Knowledge, the Subsidiaries are insured by
insurers of recognized financial responsibility against such losses and risks
and in such amounts as are prudent and customary in the businesses and locations
in which the Company and the Subsidiaries are engaged, including a prudent and
customary amount of such insurance coverage with respect to the fish inventory
of the Company and the Subsidiaries, as applicable.  The Company has
had continuous insurance coverage during the 12 months preceding the date of
this Agreement and has no reason to believe it will not be able to renew its
current insurance coverage in the same amounts or obtain new insurance coverage
in amounts not less than it currently has with carriers of equal or better
ratings.

     

    4.23    Regulatory
Permits.  The Company and the Subsidiaries hold, and are
operating in compliance in all material respects with all franchises, grants,
authorizations, licenses, permits, easements, consents, quotas, certificates and
orders (collectively, “Material Permits”) of
the U.S. Food and Drug Administration, any other federal, state or foreign
governmental authority having authority over the Company and the Subsidiaries,
or any self-regulatory body regulating the Company’s conduct of its business
(collectively, “Governmental
Authority”), all such Material Permits are valid and in full force and
effect; and the Company and the Subsidiaries have not received notice of any
revocation or modification of any such Material Permits or has reason to believe
that any such Material Permits will be revoked, modified, or not be renewed in
the ordinary course.

     

    4.24    Regulatory
Compliance.  The Company and the Subsidiaries (a) are and at
all times have been in material compliance with all applicable federal, state,
local and foreign, laws, statutes, rules, regulations, or guidance applicable to
Company and the Subsidiaries and the acquisition, ownership, testing,
development, manufacture, packaging, processing, use, distribution, marketing,
labeling, promotion, sale, offer for sale, storage, import, export or disposal
of any product or services manufactured or distributed by the Company (the
“Applicable
Laws”), except as could not, individually or in the aggregate, reasonably
be expected to result in a Material Adverse Effect; (ii) have not received any
notice of adverse finding, untitled letter or other correspondence or notice
from any Governmental Authority alleging or asserting noncompliance with any
Applicable Laws or any licenses, certificates, approvals, clearances,
authorizations, permits and supplements or amendments thereto required by any
such Applicable Laws (“Authorizations”) nor
any warning letter from the U.S. Food and Drug Administration containing any
unresolved issues concerning noncompliance with any Applicable Laws or
Authorizations that could reasonably be expected to result in a Material Adverse
Effect; (iii) possess all material Authorizations and such Authorizations
are valid and in full force and effect and are not in violation of any term of
any such Authorizations, except where such violation could not reasonably be
expected to result in a Material Adverse Effect; (iv) have not received
notice of any claim, action, suit, proceeding, hearing, enforcement,
investigation, arbitration or other action from any Governmental Authority or
third party alleging that any product operation or activity is in violation of
any Applicable Laws or Authorizations and have no Knowledge that any such
Governmental Authority or third party is considering any such claim, litigation,
arbitration, action, suit, investigation or proceeding; (v) have not
received notice that any Governmental Authority has taken, is taking or intends
to take action to limit, suspend, modify or revoke any Authorizations and the
Company has no Knowledge that any such Governmental Authority is considering
such action; and (vi) have filed, obtained, maintained or submitted all
material reports, documents, forms, notices, applications, records, claims,
submissions and supplements or amendments as required by any Applicable Laws or
Authorizations and that all such reports, documents, forms, notices,
applications, records, claims, submissions and supplements or amendments were
complete and correct in all material respects on the date filed (or were
corrected or supplemented by a subsequent submission).

     

    
      
         


      

      
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    4.25    Workplace
Safety.  The Company and the Subsidiaries (i) are in
compliance, in all material respects, with any and all applicable foreign,
federal, state and local laws, rules, regulations, treaties, statutes and codes
promulgated by any and all governmental authorities (including pursuant to the
Occupational Health and Safety Act) relating to the protection of human health
and safety in the workplace (“Occupational Laws”);
(ii) have received all material permits, licenses or other approvals
required of it under applicable Occupational Laws to conduct its business as
currently conducted, except where the failure to obtain such licenses could not
reasonably be expected to result in a Material Adverse Effect; and
(iii) are in compliance, in all material respects, with all terms and
conditions of such permit, license or approval, except where the failure to be
in compliance could not reasonably be expected to result in a Material Adverse
Effect.  No action, proceeding, revocation proceeding, writ,
injunction or claim is pending or, to the Company’s Knowledge, threatened
against the Company or the Subsidiaries relating to Occupational Laws, and the
Company does not have Knowledge of any facts, circumstances or developments
relating to its operations or cost accounting practices that could reasonably be
expected to form the basis for or give rise to such actions, suits,
investigations or proceedings.

     

    4.26    Transactions With Affiliates
and Employees.  Except as described on Schedule 4.26 or
as specifically disclosed in the SEC Reports, none of the officers, directors or
employees of the Company is presently a party to any transaction with the
Company or any of its Subsidiaries (other than for ordinary course services as
employees, officers or directors), including any contract, agreement or other
arrangement providing for the furnishing of services to or by, providing for
rental of real or personal property to or from, or otherwise requiring payments
to or from any such officer, director or employee or, to the Company’s
Knowledge, any corporation, partnership, trust or other entity in which any such
officer, director, or employee has a substantial interest or is an officer,
director, trustee or partner.

     

    4.27    Internal Accounting
Controls.  Except as specifically disclosed in the SEC Reports,
the Company and the Subsidiaries maintain a system of internal accounting
controls sufficient to provide reasonable assurance that (a) transactions are
executed in accordance with management’s general or specific authorizations, (b)
transactions are recorded as necessary to permit preparation of financial
statements in conformity with GAAP and to maintain asset accountability, (c)
access to assets is permitted only in accordance with management’s general or
specific authorization, and (d) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and appropriate action
is taken with respect to any differences.

     

    
      
         


      

      
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    4.28    Sarbanes-Oxley
Act.  The Company is in compliance in all material respects
with currently applicable requirements of the Sarbanes-Oxley Act of 2002 and
applicable rules and regulations promulgated by the SEC thereunder.

     

    4.29    Foreign Corrupt
Practices.  Neither the Company nor any of its Subsidiaries
nor, to the Knowledge of the Company, any director, officer, agent, employee or
other Person acting on behalf of the Company or any of its Subsidiaries has, in
the course of its actions for, or on behalf of, the Company (a) used any
corporate funds for any unlawful contribution, gift, entertainment or other
unlawful expenses relating to political activity; (b) made any direct or
indirect unlawful payment to any foreign or domestic government official or
employee from corporate funds; (c) violated or is in violation of any provision
of the U.S. Foreign Corrupt Practices Act of 1977, as amended; or (d) made any
unlawful bribe, rebate, payoff, influence payment, kickback or other unlawful
payment to any foreign or domestic government official or employee.

     

    4.30    Indebtedness.  Except
as disclosed in Schedule 4.30 or
as specifically disclosed in the SEC Reports, neither the Company nor any of its
Subsidiaries (i) has any outstanding Indebtedness (as defined below), (ii) has
any form of Indebtedness that grants senior Liens, or equivalent rights to any
third party over the Liens of Purchaser in the Collateral that secures the
obligations of the Company and the Subsidiaries under the Transaction Documents
(iii) is in violation of any term of or in default under any contract, agreement
or instrument relating to any Indebtedness, except where such violations and
defaults would not result, individually or in the aggregate, in a Material
Adverse Effect, or (iv) is a party to any contract, agreement or instrument
relating to any Indebtedness, the performance of which, in the judgment of the
Company’s officers, has or is expected to have a Material Adverse
Effect.  Schedule 4.30
provides a detailed description of the material terms of any such outstanding
Indebtedness.  For purposes of this Agreement: (x) “Indebtedness” of any
Person means, without duplication (A) all indebtedness for borrowed money, (B)
all obligations issued, undertaken or assumed as the deferred purchase price of
property or services (other than trade payables entered into in the ordinary
course of business), (C) all reimbursement or payment obligations with respect
to letters of credit, surety bonds and other similar instruments, (D) all
obligations evidenced by notes, bonds, debentures or similar instruments,
including obligations so evidenced incurred in connection with the acquisition
of property, assets or businesses, (E) all indebtedness created or arising under
any conditional sale or other title retention agreement, or incurred as
financing, in either case with respect to any property or assets acquired with
the proceeds of such indebtedness (even though the rights and remedies of the
Company or bank under such agreement in the event of default are limited to
repossession or sale of such property), (F) all monetary obligations under any
leasing or similar arrangement which, in connection with GAAP, consistently
applied for the periods covered thereby, is classified as a capital lease, (G)
all indebtedness referred to in clauses (A) through (F) above secured by (or for
which the holder of such indebtedness has an existing right, contingent or
otherwise, to be secured by) any mortgage, lien, pledge, charge, security
interest or other encumbrance upon or in any property or assets (including
accounts and contract rights) owned by any Person, even though the Person which
owns such assets or property has not assumed or become liable for the payment of
such Indebtedness, and (H) all Contingent Obligations (as defined below) in
respect of indebtedness or obligations of others of the kinds referred to in
clauses (A) through (G) above; (y) “Contingent
Obligations” means, as to any Person, any direct or indirect liability,
contingent or otherwise, of that Person with respect to any Indebtedness, lease,
dividend or other obligation of another Person if the primary purpose or intent
of the Person incurring such liability, or the primary effect thereof, is to
provide assurance to the obligee of such liability that such liability will be
paid or discharged, or that any agreements relating thereto will be complied
with, or that the holders of such liability will be protected (in whole or in
part) against loss with respect thereto; and (z) “Person” means an
individual or corporation, partnership, trust, incorporated or unincorporated
association, joint venture, limited liability company, joint stock company or a
government or any department or agency thereof.

     

    
      
         


      

      
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    4.31    Employee
Relations.  Neither the Company nor any of its Subsidiaries is
a party to any collective bargaining agreement or employs any member of a
union.  To the Company’s Knowledge, there are no material grievances,
disputes or controversies with any union or any other organization of employees
of the Company or any subsidiary, or threats of strikes, work stoppages or any
asserted pending demands for collective bargaining by any union or organization.
Except as described in Schedule 4.31 or
as specifically disclosed in the SEC Reports, since December 31, 2009, no
executive officer of the Company or any of its Subsidiaries has notified the
Company or any such Subsidiary that such officer intends to leave the Company or
any such Subsidiary or otherwise terminate such officer’s employment with the
Company or any such Subsidiary.  To the Knowledge of the Company or
any such Subsidiary, no executive officer of the Company or any of its
Subsidiaries is in violation of any material term of any employment contract,
confidentiality, disclosure or proprietary information agreement,
non-competition agreement, or any other contract or agreement or any restrictive
covenant, and the continued employment of each such executive officer does not
subject the Company or any such Subsidiary to any liability with respect to any
of the foregoing matters.

     

    4.32    Labor
Matters.  The Company and its Subsidiaries are in compliance in
all material respects with all federal, state, local and foreign laws and
regulations respecting labor, employment and employment practices and benefits,
terms and conditions of employment and wages and hours, except where failure to
be in compliance would not, either individually or in the aggregate, reasonably
be expected to result in a Material Adverse Effect.

     

    4.33    Environmental
Laws.  The Company and its Subsidiaries (i) are in compliance
in all material respects with any and all Environmental Laws (as hereinafter
defined), (ii) have received all permits, licenses or other approvals required
of them under applicable Environmental Laws to conduct their respective
businesses and (iii) are in compliance in all material respects with all terms
and conditions of any such permit, license or approval where, in the foregoing
clauses (i), (ii) and (iii), the failure to so comply would be reasonably
expected to have, individually or in the aggregate, a Material Adverse
Effect.  The term “Environmental Laws”
means all federal, state, local or foreign laws relating to pollution or
protection of human health or the environment (including, without limitation,
ambient air, surface water, groundwater, land surface or subsurface strata),
including, without limitation, laws relating to emissions, discharges, releases
or threatened releases of medical and biological waste or residue, chemicals,
pollutants, contaminants, or toxic or hazardous substances or wastes
(collectively, “Hazardous Materials”)
into the environment, or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of
Hazardous Materials, as well as all authorizations, codes, decrees, demands or
demand letters, injunctions, judgments, licenses, notices or notice letters,
orders, permits, plans or regulations issued, entered, promulgated or approved
thereunder.

     

    
      
         


      

      
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    4.34    Subsidiary
Rights.  Except as set forth in Schedule 4.34 or
as specifically disclosed in the SEC Reports, the Company or one of its
Subsidiaries has the unrestricted right to vote, and (subject to limitations
imposed by applicable law) to receive dividends and distributions on, all
capital securities of its Subsidiaries as are owned by the Company or such
Subsidiary.

     

    4.35    Tax
Status.  Except as specifically disclosed in Schedule 4.35 in the
Company’s financial statements, the Company and each of its Subsidiaries (i) has
made or filed all foreign, federal and state income and all other tax returns,
reports and declarations required by any jurisdiction to which it is subject,
(ii) has paid all taxes and other governmental assessments and charges that are
material in amount, shown or determined to be due on such returns, reports and
declarations, except those being contested in good faith and (iii) has set aside
on its books provision reasonably adequate for the payment of all taxes for
periods subsequent to the periods to which such returns, reports or declarations
apply.  There are no unpaid taxes in any material amount claimed to be
due by the taxing authority of any jurisdiction, and the Company has no
Knowledge of any basis for any such claim.

     

    4.36    No Manipulation of
Stock.  The Company has not taken and will not, in violation of
applicable law, take any action designed to or that would be reasonably be
expected to cause or result in manipulation in violation of applicable law or
regulation of the price of the Common Stock to facilitate the sale or resale of
the Warrant Shares.

     

    4.37    Accountants.  To
the Company’s Knowledge, Ramirez International, the Company’s auditors, are
independent accountants as required by the Securities Act and the rules and
regulations promulgated thereunder.

     

    4.38    Contracts.  The
contracts attached as exhibits to the SEC Reports that are material to the
Company are in full force and effect on the date hereof, and neither the Company
nor, to the Company’s Knowledge, any other party to such contracts is in breach
of or default under any of such contracts which would have a Material Adverse
Effect.

     

    4.39    Off-Balance Sheet
Arrangements.  There is no transaction, arrangement or other
relationship between the Company and an unconsolidated or other off-balance
sheet entity that is required to be disclosed by the Company in its Exchange Act
filings and is not so disclosed.

     

    4.40    U.S. Real Property Holding
Corporation.  The Company is not, nor has it ever been, as U.S.
real property holding corporation within the meaning of Section 897 of the
Internal Revenue Code of 1986, as amended, and the Company shall so certify upon
Purchaser’s request.

     

    5.        Representations
and Warranties of Purchaser. Purchaser hereby, represents
and warrants to the Company as follows, as of the date hereof and as of the
Closing:

     

    
      
         


      

      
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    5.1      Organization;
Authority.  Purchaser is an entity duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
organization with the requisite corporate, partnership or other power and
authority to enter into and to consummate the transactions contemplated by the
Transaction Documents and otherwise to carry out its obligations hereunder and
thereunder.  The Purchaser is duly qualified to do business and in
good standing as a foreign corporation or other entity in each jurisdiction in
which the nature of the business conducted or property owned by it makes such
qualification necessary, except where the failure to be so qualified or in good
standing, as the case may be, would not, individually or in the aggregate, have
or reasonably be expected to result in a Material Adverse Effect.  The
Purchaser has the requisite limited liability company authority to enter into
and to consummate the transactions contemplated by the Transaction Documents to
which it is a party and otherwise to carry out its respective obligations
hereunder and thereunder. The purchase by Purchaser of the Notes and Warrant
hereunder has been duly authorized by all necessary corporate, partnership or
other action on the part of such Purchaser.  This Agreement has been
duly executed and delivered by Purchaser and constitutes the valid and binding
obligation of Purchaser, enforceable against it in accordance with its terms,
except as may be limited by (i) applicable bankruptcy, insolvency,
reorganization or other laws of general application relating to or affecting the
enforcement of creditors rights generally, and (ii) the effect of rules of law
governing the availability of specific performance and other equitable
remedies.

     

    5.2      No Public Sale or
Distribution.  Purchaser is (i) acquiring the Notes and the
Warrant, and (ii) upon exercise of the Warrant will acquire the Warrant Shares
issuable upon exercise thereof, in the ordinary course of business for its own
account and not with a view towards, or for resale in connection with, the
public sale or distribution thereof, except pursuant to sales registered under
the Securities Act or under an exemption from such registration and in
compliance with applicable federal and state securities laws, and Purchaser does
not have a present arrangement to effect any distribution of the Securities to
or through any Person; provided, however, that by
making the representations herein, Purchaser does not agree to hold any of the
Securities for any minimum or other specific term and reserves the right to
dispose of the Securities at any time in accordance with or pursuant to a
registration statement or an exemption under the Securities Act.

     

    5.3      Purchaser
Status.  Purchaser understands that the Securities are being
offered and sold pursuant to an exemption from registration contained in the
Securities Act based in part upon such Purchaser’s representations contained in
this Agreement, including at the time Purchaser was offered the Securities, it
was, and at the date hereof it is, an “accredited investor”
as defined in Rule 501(a) under the Securities Act or a “qualified institutional
buyer” as defined in Rule 144A(a) under the Securities
Act.  Such Purchaser is not a registered broker dealer registered
under Section 15(a) of the Exchange Act, or a member of the NASD, Inc. or
an entity engaged in the business of being a broker dealer.  Except as
otherwise disclosed in writing to the Company on or prior to the date of this
Agreement, Purchaser is not affiliated with any broker dealer registered under
Section 15(a) of the Exchange Act, or a member of the NASD, Inc. or an
entity engaged in the business of being a broker dealer.

     

    5.4      Experience of Such
Purchaser.  Purchaser, either alone or together with its
representatives has such knowledge, sophistication and experience in business
and financial matters so as to be capable of evaluating the merits and risks of
the prospective investment in the Securities, and has so evaluated the merits
and risks of such investment.  Purchaser understands that it must bear
the economic risk of this investment in the Securities indefinitely, and is able
to bear such risk and is able to afford a complete loss of such
investment.

     

    
      
         


      

      
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    5.5      Access to
Information.  Purchaser acknowledges that it has had the
opportunity to review the Disclosure Materials and has been afforded: (i) the
opportunity to ask such questions as it has deemed necessary of, and to receive
answers from, representatives of the Company concerning the terms and conditions
of the offering of the Securities and the merits and risks of investing in the
Securities; (ii) access to information about the Company and the Subsidiaries
and their respective financial condition, results of operations, business,
properties, management and prospects sufficient to enable it to evaluate its
investment; and (iii) the opportunity to obtain such additional information that
the Company possesses or can acquire without unreasonable effort or expense that
is necessary to make an informed investment decision with respect to the
investment.  Neither such inquiries nor any other investigation
conducted by or on behalf of Purchaser or its representatives or counsel shall
modify, amend or affect such Purchaser’s right to rely on the truth, accuracy
and completeness of the Disclosure Materials and the Company’s representations
and warranties contained in the Transaction Documents.

     

    5.6      No Governmental
Review.  Purchaser understands that no United States federal or
state agency or any other government or governmental agency has passed on or
made any recommendation or endorsement of the Securities or the fairness or
suitability of the investment in the Securities nor have such authorities passed
upon or endorsed the merits of the offering of the Securities.

     

    5.7      No
Conflicts.  The execution, delivery and performance by
Purchaser of this Agreement and the consummation by Purchaser of the
transactions contemplated hereby will not (i) result in a violation of the
organizational documents of Purchaser, (ii) conflict with, or constitute a
default (or an event which with notice or lapse of time or both would become a
default) under, or give to others any rights of termination, amendment,
acceleration or cancellation of, any agreement, indenture or instrument to which
Purchaser is a party, or (iii) result in a violation of any law, rule,
regulation, order, judgment or decree (including federal and state securities
laws) applicable to Purchaser, except in the case of clauses (ii) and (iii)
above, that do not otherwise affect the ability of Purchaser to consummate the
transactions contemplated hereby.

     

    5.8      Prohibited
Transactions.  Purchaser covenants that neither it nor any
Person acting on its behalf or pursuant to any understanding with Purchaser will
engage, directly or indirectly, in any transactions in the securities, including
derivatives, of the Company (including, without limitation, any Short Sales (a
“Transaction”)
involving any of the Company’s securities prior to the time the transactions
contemplated by this Agreement are publicly disclosed.  Purchaser
covenants further that neither it nor any Person acting on its behalf or
pursuant to any understanding with Purchaser will engage, directly or
indirectly, in any Short Sales involving any of the Company's securities during
the time that Purchaser or its affiliates hold the Warrant or any of the Notes
are outstanding.  “Short Sales” include,
without limitation, all “short sales” as defined in Rule 200 promulgated under
Regulation SHO under the Exchange Act and all types of direct and indirect stock
pledges, forward sale contracts, options, puts, calls, short sales, swaps,
derivatives and similar arrangements (including on a total return basis), and
sales and other transactions through non-U.S. broker-dealers or foreign
regulated brokers.

     

    5.9      Restricted
Securities.  Purchaser understands that the Securities are
characterized as “restricted securities” under the U.S. federal securities laws
inasmuch as they are being acquired from the Company in a transaction not
involving a public offering and that under such laws and applicable regulations
such securities may be resold without registration under the Securities Act only
in certain limited circumstances.

     

    
      
         


      

      
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    5.10    Legends.  It
is understood that certificates evidencing such Securities may bear the legend
set forth in Section 11.1 of
this Agreement.

     

    5.11    No Legal, Tax or Investment
Advice.  Purchaser understands that nothing in this Agreement
or any other materials presented by or on behalf of the Company to Purchaser in
connection with the purchase of the Securities constitutes legal, tax or
investment advice.  Purchaser has consulted such legal, tax and
investment advisors as it, in its sole discretion, has deemed necessary or
appropriate in connection with its purchase of the Securities.

     

    6.        Covenants
and Agreements.

     

    6.1      Pre-Closing Covenants and
Agreements.  The parties hereto covenant and agree to perform
or take any and all such actions to effectuate the following from the date
hereof until the earlier of the Closing Date or the termination of this
Agreement:

     

    (i)           Further
Assurances.  The parties shall, prior to or at the Closing, as
may be appropriate, execute such documents and other papers and take such other
further actions as may be reasonably required to carry out the provisions hereof
and effectuate the transactions contemplated hereby and by the Notes and the
Warrant.  Each party shall use its best efforts to fulfill or obtain
the fulfillment of the conditions to its obligation to effect the Closing,
including promptly obtaining any consent required in connection
herewith.

     

    (ii)          Additional
Disclosure.  The Company shall promptly notify Purchaser of,
and furnish Purchaser with any information it may reasonably request with
respect to, the occurrence of any event or condition or the existence of any
fact that would cause any of the conditions to Purchaser’s obligation to
consummate the transactions contemplated by this Agreement not to be
fulfilled.

     

    6.2      Post-Closing Covenants and
Agreements.

     

    (a)         While
the Notes are outstanding, the Company shall not, without the prior written
consent of Purchaser:

     

    (i)            from
and after the Closing Date, have or incur, or permit any of its Subsidiaries to
have or incur any additional Indebtedness, other than the Indebtedness
represented by the Notes, Indebtedness disclosed on Schedule 4.30 and
Indebtedness: (a) used to repay the existing Indebtedness of the Company or of
the Subsidiaries on a dollar-for-dollar basis, including, without limitation,
Indebtedness incurred by Baja or the Company, the proceeds of which shall be
used to repay Indebtedness existing as of the date hereof owing to the sellers
of Baja in connection with the Baja Acquisition, (b) of up to $5,000,000
incurred by the Company no later than November 30, 2010 for the exclusive
purpose of acquiring additional equity interests of Baja which is not currently
owned by the Company as of the date hereof (the “Baja Acquisition
Debt”), (c) used to increase the biomass at the fish farming sites of the
Company’s operating subsidiaries, including indebtedness incurred to finance the
acquisition of any related fixed assets or related capital leases, (d) from a
Subsidiary to Company or to another Subsidiary of from Company to a Subsidiary,
(e) consisting of the financing of insurance premiums arising in the ordinary
course of business; (f) which is secured by a mortgage Lien on real property,
provided that such indebtedness shall (1) be non-recourse to the Company or any
Subsidiary (other than in respect of such real property) and (2) not be secured
by any assets of the Company or a Subsidiary other than such real property; and
(g)  of the Subsidiaries or Company consisting of unsecured
indebtedness in an aggregate principal amount for all such unsecured
indebtedness not exceeding $2,000,000 at any time outstanding;

     

    
      
         


      

      
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    (ii)           utilize,
or permit any Subsidiary to utilize, cash flow from operations to prepay any
existing indebtedness (other than indebtedness evidenced by the Notes), provided
however, as long as the Company is not deemed in default under the Notes, it or
its Subsidiaries may utilize cash flow from operations for the repayment prior
to repayment of the Notes of the following: (a) the entire remaining outstanding
principal balance (after application of the proceeds of the Notes) of the
original $8,000,000 loan entered into by the Company and certain sellers in
connection with the Baja Acquisition (the “Baja Existing Debt”),
(b) that amount of the outstanding $3,000,000 Senior Secured Bridge Note to be
issued by the Company in favor of Seaside 88, LP (the “Seaside Debt”),
provided that the repayment of the Seaside Debt under this Section 6.2(a)(ii)(b)
shall be permitted only to the extent that proceeds from the Seaside Debt is
used to repay the Baja Existing Debt in accordance with Section 6.2(a)(ii), (c)
the Baja Acquisition Debt and (d) that amount of the principal balance that is
in excess of $8,000,000 of the total outstanding principal amount owed to
Atlantis in connection with that certain Loan Agreement entered into by and
between Atlantis and the Company, dated June 30, 2010, as amended on the date
hereof (the “Atlantis
Line of Credit”) provided, further, that
in the event that: (i) the Company fully satisfies its obligations under the
First Note, (ii) the Company is not in default under the Second Note and (iii)
the Company and Subsidiaries agree to, and have sufficient inventory available
to, increase the value of the inventory comprising the Collateral to an amount
that is equal to at least four times the sum of the then outstanding principal
amount and accrued interest due under the Notes, then the Company or its
Subsidiaries may utilize cash flow from operations for the repayment of that
portion of the principal balance that is in excess of $4,000,000 of the total
outstanding principal amount owed to Atlantis in connection with the Atlantis
Line of Credit;

     

    (iii)        
from and after the Closing Date, make, or permit any Subsidiary to make, any
payments (whether on payment of pre-existing indebtedness or otherwise) or
distributions to, or engage in any transactions with, officers, principal or
former principal shareholders or other insiders of the Company or of any
Subsidiary or with officers or other insiders of any Subsidiary (other than
salary payments consistent with the past practices of the Company), regardless
of whether any such payments, distributions or transactions are described in or
contemplated by the SEC Reports or other Disclosure Materials, provided,
however, that the provisions of this Section 6.2(a)(iii) shall not apply to
those transactions specifically disclosed on Schedule
6.2;

     

    
      
         


      

      
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    (iv)         from
and after the Closing Date, grant or cause a Subsidiary to grant, a Lien against
the Collateral (other than Permitted Liens (as hereinafter defined) with respect
to the Collateral other than the shares of Baja and Bluefin), whether
subordinate or senior to any Liens granted in favor of Purchaser in connection
with the transactions contemplated by this Agreement, to a party other than
Purchaser, without the prior written consent of Purchaser and delivery to
Purchaser of an Intercreditor Agreement executed by the proposed lienholder,
which terms of such Intercreditor Agreement shall be approved by Purchaser in
its sole discretion.  “Permitted Liens” mean: (a) Liens for taxes not
yet delinquent or which are being contested in good faith by appropriate
proceedings (and for the payment of which adequate reserves are provided in
accordance with GAAP), (b) any Lien existing on any property or asset prior to
the acquisition thereof by the Company or any Subsidiary, provided that (1) such
Lien is not created in contemplation of or in connection with such acquisition,
(2) such Lien shall not apply to any other property or assets of the Company or
such Subsidiary, (3) such Lien shall secure only those obligations that it
secures on the date of such acquisition, and any extensions, renewals and
replacements thereof that do not increase the outstanding principal amount
thereof, and (4) such Lien does not apply to any inventory of the Company or
such Subsidiary; (c) Liens arising as a matter of law in connection with the
purchase, storage or shipping of goods or assets and proceeds thereof in favor
of the seller, storer or shipper of such goods or assets and (d) Liens arising
as a matter of law in favor of customs and revenues authorities which secure
payment of customs duties in connection with the importation of goods;
nor

     

    (v)          take,
or permit any Subsidiary to take, any corporate action that would materially
impair the value of the Collateral securing the obligations of the Company under
the Notes or the obligations of the Company and the Subsidiaries under the
guaranty agreements executed in connection herewith.

     

    (b)       
The Company shall pay to Purchaser additional interest (“Additional Interest”)
as follows:

     

    (i)            The
payment of Additional Interest shall be made by the Company to Purchaser, in
cash, no later than five (5) days after the filing due date of the Company’s
Quarterly Report for the period ending March 31, 2012, inclusive of any SEC Rule
12b-25 extensions requested by the Company (the “Filing
Date”);

     

    (ii)           The
amount of Additional Interest payable shall be computed in accordance with
Schedule 1 attached hereto (as such schedule may be amended pursuant to Section
6.2(b)(iv)).  For purposes of computing the Additional Interest, the
Company’s EBITDA per share shall be based on the Company’s performance for the
twelve month period ending March 31, 2012 (the “Original EBITDA”),
provided however, that in the event that the Company fails to file its Quarterly
Report for the period ending March 31, 2012 prior to the Filing Date, the
Company’s EBITDA per share shall be based on the Company’s performance for the
most recent twelve month period for which periodic filings have been made with
the SEC (the “Alternate
EBITDA”).  In the event that the Company files the Quarterly
Report for the period ending March 31, 2012 following the payment of the
Additional Interest, and the Original EBITDA is less than the Alternate EBITDA,
then the Company shall be obligated to immediately pay Purchaser any shortfall
in Additional Interest that resulted from the use of the Alternate EBITDA, as
opposed to the Original EBITDA, in computing the Additional
Interest.  In no event, however, shall the Purchaser be obligated to
reimburse the Company for any overpayment of Additional Interest that resulted
from the use of the Alternate EBITDA, as opposed to the Original EBITDA, in
computing the Additional Interest;

     

    (iii)          In
the event that the Company fully satisfies its obligations under the Second Note
prior to its stated maturity date, then the amount of Additional Interest
payable to Purchaser shall be reduced by five percent (5%) for each full
calendar month that the Second Note was repaid prior to such maturity date,
provided however, that such reduction of Additional Interest may not exceed
sixty percent (60%).  For example, if the maturity date of the Second
Note is March 31, 2012 and it is repaid on September 15, 2011, the Additional
Interest otherwise owed pursuant to this Section 6.2(b) shall be reduced by
30%.

     

    
      
         


      

      
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    (iv)         Subject
to Section
6.2(a)(i), in the event that the Company or the Subsidiaries incur
additional indebtedness for the purposes of directly or indirectly acquiring an
additional business or the operations of another company, then the amounts of
EBITDA per share reflected in Schedule 1 shall be adjusted by multiplying such
EBITDA per share amounts by the ratio of (x) the sum of post-acquisition
consolidated indebtedness and consolidated book value of the Company and its
subsidiaries to (y) the sum of pre-Closing consolidated indebtedness and
consolidated book value of the Company and the Subsidiaries, such multiple to be
pro-rated for the number of months remaining from the incurrence of the
additional indebtedness until the applicable EBITDA measurement date, as may be
adjusted in accordance with the last sentence of Section
6.2(b)(ii).  For purposes of this Section 6(b)(iv), the
pre-closing and post-closing consolidated indebtedness and book value of the
Company shall be calculated by reference to the applicable account balances
reflected in the Company’s consolidated financial statements for such
appropriate periods.

     

    (v)          If
the Company’s actual EBITDA per share as computed in accordance with Section 6.2(b)(ii) of
this Agreement, is in excess of the greater of: (i) $0.3900 per share or (ii)
the highest amount of EBITDA per share in Schedule 1 if such schedule is
adjusted pursuant to Section 6.2(b)(iv),
then the Company shall not be obligated to pay Purchaser Additional Interest
pursuant to this Section
6.2(b).

     

    (c)          The
Company and the Subsidiaries shall maintain an insurance policy in an amount
that  fully insures the Collateral, with any proceeds or disbursements
from such policy to be used exclusively to either: (i) pay Purchaser an amount
up to the sum of (x) the principal balance outstanding under the Notes, (y) any
accrued and unpaid interest under the Notes and (z) the amount of Additional
Interest, if any, payable to the Purchaser or (ii) purchase such an amount of
replacement Collateral as is necessary to ensure that the Company and the
Subsidiaries, as applicable, own a sufficient amount of Collateral to fulfill
each of their respective obligations under Sections 3.1, 3.5 and 3.6 of this
Agreement or other applicable terms of the Transaction Documents.

     

    (d)           The
Company shall not, without the prior written consent of the Purchaser, which
consent shall not be unreasonably withheld, effect, directly, or indirectly, any
repurchase or redemption of issued and outstanding shares of Common Stock which
would cause the Purchaser (together with such Purchaser’s affiliates) to
beneficially own in excess of 4.99% of the shares of Common Stock outstanding
immediately after giving effect to such repurchase or redemption, calculated in
accordance with Section 4(d) of the
Warrant.

     

    (e)           Prior
to December 16, 2010, the Company shall (i) have consummated the Baja
Acquisition and shall own 99.984% of the issued and outstanding capital stock of
Baja and (ii) have pledged all shares acquired in connection with such
acquisition to Purchaser in accordance with such terms set for in the
Transaction Documents. Should the Company fail to
fulfill its obligations set forth in this Section 6.2(e), for any reason
whatsoever, prior to December 16, 2010, then, the amount of interest payable
under the Notes shall be increased 50% to an interest rate of 13.5% per annum
until such time as the Company shall have fulfilled its obligations set forth
under this Section 6.2(e), provided, however, that if the
Company fails to satisfy its obligations set forth under this Section 6.2(e)
prior to January 1, 2011, then the Purchaser may in its sole discretion deem the
Company’s inability to satisfy such obligations to be an event of default by the
Company under the Notes.

     

    
      
         


      

      
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    (f)            Prior
to November 16, 2010, the Company shall: (i) have caused both Baja and Kali to
enter into and deliver to Purchaser the Collateral Agreements consistent to the
terms set forth, respectively, in Section 3.5 and Section 3.6 hereunder and (ii)
shall cause each of Baja and Kali to make available to Purchaser, a sufficient
amount of inventory to satisfy their respective obligations hereunder; provided,
however, that if Baja or Kali, for any reason whatsoever, fail to provide the
Purchaser with (i) both the Baja Subsidiary Security Agreement and the Kali
Subsidiary Security Agreement prior to November 16, 2010, or (ii) shall Baja and
Kali fail to make available to Purchaser sufficient amount of inventory to
satisfy their respective obligations hereunder prior to November 16, 2010, then,
the amount of interest payable by the Company under the Notes shall be increased
50% to an interest rate equal to 13.5% per annum, which rate shall remain in
effect until both Baja and Kali provide the Collateral Agreements to Purchaser
and make available to Purchaser a sufficient amount of inventory to satisfy
their respective obligations hereunder; provided, further, that if Kali
and Baja fail to satisfy either of their respective foregoing obligations prior
to December 16, 2010, then, the Purchaser may in its sole discretion deem Baja’s
or Kali’s inability to satisfy such obligations to be an event of default by the
Company under the Notes.

     

    (g)           No
later than the effectiveness of grant of the security interests in Baja
Inventory and Kali Inventory referred to in Sections 3.5 and 3.6 hereof, the
Company shall cause to be delivered, to the Purchaser, opinions of local counsel
as to certain matters relating to Baja, Kali and such security interests, in
form and substance reasonably satisfactory to Purchaser and its
counsel.

     

    (h)           Within
five (5) business days following the Closing, the Company shall cause Baja to
issue, and shall deliver to Purchaser, duly authorized and validly issued
permanent (non-provisional) replacement stock certificates for those shares of
capital stock of Baja comprising the shares of stock included in the Baja Pledge
on the Closing, in such form as shall be approved by the Purchaser’s local
Mexican counsel.

     

    (i)            Within
forty-five (45) calendar days following the Closing, the Company shall cause
Baja to deliver to Purchaser either: (i) a written consent from BBVA Bancomer,
S.A., Institucion de Banca Multiple, consenting to Baja’s guaranty of the
Company’s obligations pursuant to the terms of the Baja Subsidiary Guarantee
Agreement or evidence that such consent is no longer required or (ii) a properly
executed guarantee from Kali, guaranteeing the Company’s obligations hereunder,
with such guarantee providing for substantially similar terms and obligations as
those set forth in the Baja Subsidiary Guarantee Agreement.

     

    
      
         


      

      
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    7.           Conditions
Precedent to the Obligation of Purchaser to Close.

     

    The
obligation of Purchaser to complete the Closing is subject to the fulfillment on
or prior to the Closing Date of all of the following conditions, any one or more
of which may be waived by Purchaser in writing:

     

    (i)           Representations and
Warranties.  The representations and warranties of the Company
contained in Section
4 shall be true on and as of the Closing.

     

    (ii)          Agreements and
Conditions.  On or before the Closing Date, the Company shall
have complied with and duly performed and satisfied in all material respects all
agreements and conditions on its part to be complied with and performed by such
date pursuant to this Agreement;

     

    (iii)         Liabilities.  Immediately
prior to the Closing Date, the Company and the Subsidiaries shall have no more
than $45,000,000 in current or long-term liabilities, exclusive of the
obligations under the Notes, trade payables and other liabilities arising in
connection with legal, accounting and financial advisory expenses incurred in
the ordinary course, consistent with prior practice.

     

    (iv)         Subordination of Existing
Indebtedness. The Company shall have delivered to Purchaser subordination
agreements with the parties holding Indebtedness of the Company, in the form and
with the terms reasonably approved by Purchaser, evidencing that the Notes
entered into by the Company are senior to such other Indebtedness of the
Company.

     

    (v) 
        Consents.  The
Company shall have obtained any consents necessary to effectuate this Agreement
and to consummate the transactions contemplated hereby and delivered copies
thereof to Purchaser.

     

    (vi)         Delivery of the Notes and
Warrant.  The Company shall have duly executed and delivered to
Purchaser the Notes and Warrant being purchased pursuant to this
Agreement.

     

    (vii)        Compliance
Certificate.  The Chief Executive Officer of the Company shall
deliver to Purchaser at the Closing a certificate certifying that the conditions
specified in Sections
7(i) through Section 7(v) have
been fulfilled.

     

    (viii)      Delivery of Pledged
Shares. The Company shall have delivered to Purchaser certificates
representing (x) all of the issued and outstanding shares of Bluefin, duly
endorsed in blank or accompanied by executed stock powers, and (y) 33% of the
issued and outstanding shares of Baja, duly endorsed in blank or accompanied by
executed stock powers.

     

    (ix)         Applicable Board and
Shareholder Resolutions.  The Company shall deliver to
the  Purchaser copies of (i) a unanimous written consent of the Board
of the Directors of the Company authorizing the execution, delivery and
performance of the applicable Transaction Documents by the Company, (ii)
unanimous written consents or otherwise duly authorized action of each
applicable Subsidiaries authorizing the execution, delivery and performance of
the applicable Transaction Documents by such Subsidiaries, and (iii) to the
extent required by law or agreement, written consents or otherwise duly
authorized action of each individual shareholder of the Company or of any
individual Subsidiary authorizing the execution, delivery and performance of the
applicable Transaction Documents by the Company or any such
Subsidiary.

     

    
      
         


      

      
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    (x)          Commitment
Fee.  At Closing, the Company shall pay to Purchaser a one-time
commitment fee of twenty five thousand dollars ($25,000) which may, at the
option of Purchaser, be paid by offset against the cash purchase price payable
for the Notes purchased at the Closing.

     

    (xi)         Opinion of Company
Counsels.  Purchaser shall have received from Loeb & Loeb
LLP, as New York counsel for the Company, an opinion, dated as of the Closing,
in substantially the form of Exhibit G-1 attached
hereto and from Lionel Sawyer & Collins, as Nevada counsel for the Company,
an opinion, dated as of the Closing, in substantially the form of Exhibit G-2 attached
hereto.

     

    (xii)        Company Pledge and Security
Agreement; Subsidiary Guarantee and Pledge and Security Agreements. The
Company and the Subsidiaries shall have executed and delivered to Purchaser the
agreements described in Sections 3.1, 3.2, 3.3 and 3.4 hereof.

     

    8.        Conditions
Precedent to the Obligation of the Company to Close.

     

    The
obligation of the Company to complete the Closing is subject to the fulfillment
on or prior to the Closing Date of all of the following conditions, any one or
more of which may be waived by the Company in writing:

     

    (i)           Representations and
Warranties.  The representations and warranties of Purchaser
contained in Section
5 shall be true on and as of each Closing.

     

    (ii)          Agreements and
Conditions.  On or before the Closing Date, Purchaser shall
have complied with and performed and satisfied in all material respects all
agreements and conditions to be complied with and performed by such date
pursuant to this Agreement.

     

    (iii)         Consents.  Purchaser
shall have obtained any consents necessary to effectuate this Agreement and to
consummate the transactions contemplated hereby and delivered copies thereof to
the Company.

     

    (iv)         Payment of Purchase
Price.  Purchaser shall have paid to the Company the Purchase
Price for the Notes, less any offsets permitted pursuant to this
Agreement.

     

    9.           Use of
Proceeds.  The Company shall use the net
proceeds (net of any fees and transaction expenses) from the sale of the Notes
for the exclusive purpose of repaying indebtedness incurred to the former
holders of the shares of Baja previously acquired or to be acquired by the
Company, provided that to the extent additional proceeds remain after the
repayment of all such indebtedness, then such remaining proceeds may be used for
working capital and general corporate purposes.

     

    
      
         


      

      
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    10.      Restrictions
on Transferability.

     

    10.1    Restrictive
Legend.  Purchaser understands that, until such time as a
registration statement pursuant to the Securities Act has been declared
effective or the Warrant Shares may be sold pursuant to Rule 144(b) under the
Securities Act without any restriction as to the number of securities as of a
particular date that can then be immediately resold, the certificate(s)
representing the Warrant Shares shall bear a restrictive legend in substantially
the following form (and a stop-transfer order may be placed against transfer of
the certificates for the securities comprising the Warrant Shares):

     

    THE
SECURITIES REPRESENTED HEREBY HAVE BEEN ISSUED WITHOUT REGISTRATION UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR UNDER ANY STATE SECURITIES LAWS, AND MAY
NOT BE SOLD, TRANSFERRED OR PLEDGED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT UNDER APPLICABLE FEDERAL AND STATE SECURITIES LAWS OR AN OPINION OF
COUNSEL REASONABLY SATISFACTORY TO THE COMPANY THAT THE TRANSFER IS EXEMPT FROM
REGISTRATION UNDER APPLICABLE FEDERAL AND STATE SECURITIES LAWS.

     

    10.2    Restrictions on
Transferability.  Purchaser hereby covenants with the Company
not to effect any resale or other disposition of any of the Warrant Shares
without complying with the provisions of this Agreement, and without effectively
causing any prospectus delivery requirement under the Securities Act to be
satisfied, and Purchaser acknowledges and agrees that such Warrant Shares are
not transferable on the books of the Company unless (a) the Warrant Shares have
been sold in accordance with an effective registration statement or valid
exemptions from registration under the Securities Act and any applicable state
securities or “blue sky” laws, (b) prior to such time that a registration
statement shall have become effective under the Securities Act, Purchaser shall
have furnished the Company with an opinion of counsel, reasonably satisfactory
to the Company, that such disposition will not require registration of the
Warrant Shares under the Securities Act and (c) if applicable, the requirement
of delivering a current prospectus has been satisfied.  Purchaser
acknowledges that the Company is not obligated to file and may not file any such
registration statement with the SEC.

     

    11.       Registration
Rights.

     

    11.1 Demand
Registration.

     

    (i)           If,
at any time after nine (9) months following the Closing Date, Purchaser decides
it may sell or otherwise dispose of the Registrable Securities (as defined
below), then Purchaser shall deliver a written request to the Company requesting
that the Company prepare and file a registration statement under the Securities
Act or any successor statute covering such Registrable Securities and specifying
the intended method of the proposed disposition and the portion of the
Registrable Securities to be sold or disposed (each such request shall be
referred to herein as a “Demand
Registration”).  “Registrable
Securities” shall mean shares of Common Stock issued or issuable to
Purchaser under the Warrant, together with any securities issued or issuable
upon any stock split, dividend or other distribution, recapitalization or
similar event with respect to the foregoing, provided however, that Registrable
Securities shall not include any shares (i) the sale of which has been and
continues to be registered pursuant to the Securities Act or (ii) which have
been sold without restriction.

     

    
      
         


      

      
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    (ii)         Upon
receipt of the Demand Registration, as expeditiously as possible, the Company
shall use its best efforts to cause an appropriate registration statement (the
“Registration
Statement”) covering such Registrable Securities to be filed with the SEC
and to be declared effective as soon as reasonably practicable.

     

    (iii)         The
Company shall not be obligated to effect more than a total of two (2) Demand
Registrations on forms other than Form S-3.  A Demand Registration
under this Section 11.1 shall not be deemed to have occurred unless the
Registration Statement relating thereto (A) has become effective under the
Securities Act and (B) has remained effective for a period of at least one
hundred twenty (120) days (or such shorter period in which all of Purchaser’s
Registrable Securities included thereunder have actually been sold), provided
that such Registration Statement shall not be considered a Demand Registration
if, after such registration statement becomes effective, such registration
statement is interfered with by any stop order, injunction or other order or
requirement of the SEC or other governmental agency or court.

     

    (iv)        The
Company shall bear all of the costs and expenses relating to the Registration
Statement, including, but not limited to, registration, filing and qualification
fees, printing expenses, reasonable accounting and legal fees and disbursements,
provided however, that underwriting discounts and commissions and reimbursable
underwriters’ expenses will be borne pro-rata by Purchaser based on the number
of Purchaser’s Registrable Securities covered by the Registration Statement in
relation to the total number of shares covered by the Registration Statement
(collectively, the “Costs and
Expenses”).  Notwithstanding the foregoing, Purchaser shall pay
or reimburse the Company for fifty percent (50%) of the total amount of
reasonable legal and accounting expenses incurred in connection with a Demand
Registration, provided however, that to the extent that the Registration
Statement covers the shares of common stock of other holders, then Purchaser
shall be obligated to reimburse only 50% of Purchaser’s pro-rata portion of such
legal and accounting expenses, which portion shall be based on the number of
Purchaser’s Registrable Securities covered by the Registration Statement in
relation to the total number of shares covered by the Registration
Statement.

     

    (v)         Notwithstanding
anything to the contrary herein, if the Company shall furnish to Purchaser a
certificate signed by the President, Chief Executive Officer or Chairman of the
Board of Directors of the Company stating that in the good faith judgment of the
Board of Directors of the Company, it would be seriously detrimental to the
Company and its stockholders for such Registration Statement to be filed and it
is therefore essential to defer the filing of such Registration Statement, then
the Company shall have the right to defer such filing for a period of not more
than ninety (90) days after receipt of the Demand Registration, provided
however, that the Company may not utilize this right more than once in any
twelve (12) month period.

     

    11.2 Form S-3
Registration.  In the event the Company becomes eligible to use
Form S-3 for the registration of its securities, and the Company shall receive
from Purchaser a written request that the Company effect a registration on Form
S-3 and any related qualification or compliance with respect to all or a part of
the Registrable Securities owned by Purchaser, then the Company
will:

     

    
      
         


      

      
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    (i)           promptly
give written notice of the proposed registration and Purchaser’s request
therefor, and any related qualification or compliance, to all other holders
(each, a “Holder”) of the
Company’s common stock.

     

    (ii)         as
soon as practicable, effect such registration and any related qualifications and
compliances as may be so requested and as would permit or facilitate the sale
and distribution of all or such portion of Purchaser’s Registrable Securities as
are specified in such request, together with all or such portion of the common
stock of any other Holder or Holders joining in such request as are specified in
a written request given within twenty (20) days after receipt of such written
notice from the Company; provided, however, that the
Company shall not be obligated to effect any such registration, qualification or
compliance pursuant to this Section 11.2:

     

    (a)           if
Form S-3 is not available for such offering;

     

    (b)           if
Purchaser, together with the Holders of any other securities of the Company
entitled to inclusion in such registration, propose to sell the Registrable
Securities and such other securities (if any) at an aggregate price to the
public of less than One Million Dollars ($1,000,000);

     

    (c)           if
the Company shall furnish to the Holders a certificate signed by the President,
Chief Executive Officer or Chairman of the Board of Directors  of the
Company stating that in the good faith judgment of the Board of Directors of the
Company, it would be seriously detrimental to the Company and its stockholders
for such Form S-3 Registration to be effected at such time, in which event the
Company shall have the right to defer the filing of the Form S-3 registration
statement no more than once during any twelve (12) month period for a period of
not more than ninety (90) days after receipt of the request of Purchaser under
this Section 11.2;

     

    (d)           if
the Company has, within the twelve (12) month period preceding the date of such
request, already effected one (1) registration on Form S-3 for Purchaser
pursuant to this Section 11.2; or

     

    (e)           in
any particular jurisdiction in which the Company would be required to qualify to
do business or to execute a general consent to service of process in effecting
such registration, qualification or compliance.

     

    (iii)         Subject
to the foregoing, the Company shall file a Form S-3 registration statement
covering the Registrable Securities and other securities so requested to be
registered pursuant to this Section 11.2 as soon as practicable after receipt of
the request or requests of Purchaser for such registration.  The
Company shall pay all Costs and Expenses incurred in connection with the
registration requested pursuant to this Section 11.2.

     

    (iv)        Form
S-3 registrations shall not be deemed to be a Demand Registrations as described
in Section 11.1 above.

     

    
      
         


      

      
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    11.3  Piggyback
Registration.  If at any time the Company shall propose the
filing of a Registration Statement on an appropriate form under the Securities
Act of any securities of the Company, but excluding
Registration Statements relating to any registration under Section 11.1 or
Section 11.2 or to any employee benefit plan or a corporate reorganization, then
the Company shall give Purchaser notice of such proposed registration and shall
include in any Registration Statement relating to such securities all or a
portion of Purchaser’s Registrable Securities as Purchaser shall request, by
notice given by Purchaser to the Company within twenty (20) days after the
giving of such notice by the Company, to be so included.  In the event
of the inclusion of Registrable Securities pursuant to this Section 11.3, the
Company shall bear all of the Costs and Expenses of such registration; provided,
however, that Purchaser shall be obligated to pay, pro rata based upon the
number of Registrable Securities included therein, the underwriters' discounts
and compensation.  In the event the distribution of securities of the
Company covered by a Registration Statement referred to in this Section 11.3 is
to be underwritten, then the Company's obligation to include Registrable
Securities in such Registration Statement shall be subject, at the option of the
Company, to the following further conditions:

     

    (i)       The
distribution for the account of Purchaser shall be underwritten by the same
underwriters who are underwriting the distribution of the securities for the
account of the Company and/or any other persons whose securities are covered by
such Registration Statement, and Purchaser will enter into an agreement with
such underwriters containing customary provisions;

     

    (ii)      If
the underwriting agreement entered into with the aforesaid underwriters contains
restrictions upon the sale of securities of the Company, other than the
securities which are to be included in the proposed distribution, for a period
not exceeding one hundred eighty (180) days from the effective date of the
Registration Statement, then such restrictions will be binding upon Purchaser
and, if requested by the Company, Purchaser will enter into a written agreement
to that effect; and

     

    (iii)     If
the underwriters state in writing that they are unwilling to include any or all
of Purchaser’s securities in the proposed offering because such inclusion will
materially interfere with the orderly sale and distribution of the securities
being offered by the Company, then the number of Purchaser’s Registrable
Securities to be included will be reduced in accordance with such statement by
the underwriters.

     

    11.4    Amendment of Registration
Rights.   The registration rights provisions under this
Section 11 may be amended and the observance thereof may be waived (either
generally or in a particular instance and either retroactively or
prospectively), only with the written consent of Purchaser.

     

    11.5    Registration
Procedures.   In connection with the filing of a
Registration Statement pursuant to Section 11 hereof, and in supplementation and
not in limitation of the provisions hereof, the Company shall:

     

    (i)       Notify
Purchaser as to the filing of the Registration Statement and of all amendments
or supplements thereto filed prior to the effective date of said Registration
Statement;

     

    
      
         


      

      
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    (ii)      Notify
Purchaser, promptly after the Company shall receive notice thereof, of the time
when said Registration Statement became effective or when any amendment or
supplement to any prospectus forming a part of said Registration Statement has
been filed;

     

    (iii)     Notify
Purchaser promptly of any request by the SEC for the amending or supplementing
of such Registration Statement or prospectus or for additional
information;

     

    (iv)    Prepare
and promptly file with the SEC, and promptly notify Purchaser of the filing of,
any amendments or supplements to such Registration Statement or prospectus as
may be necessary to correct any statements or omissions;

     

    (v)     Prepare
and file with the SEC, promptly upon Purchaser's written request, any amendments
or supplements to such Registration Statement or prospectus which may be
reasonably necessary or advisable in connection with the distribution of the
Registrable Securities;

     

    (vi)    Prepare,
promptly upon request of Purchaser or any underwriters for Purchaser, such
amendment or amendments to such Registration Statement and such prospectus or
prospectuses as may be reasonably necessary to permit compliance with the
requirements of the Securities Act applicable;

     

    (vii)   Advise
Purchaser promptly after the Company shall receive notice or obtain knowledge of
the issuance of any stop order by the SEC suspending the effectiveness of any
such Registration Statement or amendment thereto; or the initiation or
threatening of any proceeding for that purpose.  In such event the
Company shall promptly use its best efforts to prevent the issuance of any stop
order or obtain its withdrawal promptly if such stop order should be
issued;

     

    (viii)  Furnish
Purchaser, as soon as available, copies of any Registration Statement and each
preliminary or final prospectus, or supplement or amendment required to be
prepared pursuant hereto, all in such quantities as Purchaser may, from time to
time, reasonably request; and

     

    (ix)     If
requested by Purchaser, enter into an agreement with the underwriters of the
Registrable Securities being registered containing customary provisions and
reflecting the foregoing.

     

    12.        Rule 144
Reporting.  With a view to
making available to Purchaser the benefits of certain rules and regulations of
the SEC, which may permit the resale of the Warrant Shares to the public without
registration, the Company agrees after the date hereof to:

     

    (i)       make
and keep public information available, as those terms are understood and defined
in Rule 144(c) under the Securities Act;

     

    (ii)      file
with the SEC all reports and other documents required of the Company under the
Securities Act and the Exchange Act (it being expressly acknowledged by the
parties hereto that if any such report or document is not filed with the SEC
within thirty (30) days of the date required under the rules and regulations of
the SEC (after giving effect to any Rule 12b-25 extensions under the Exchange
Act), such failure shall be deemed an Event of Default under the Notes);
and

     

    
      
         


      

      
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    (iii)     so
long as Purchaser owns any Registrable Securities, to furnish to Purchaser
forthwith upon request a written statement by the Company as to its compliance
with the reporting requirements of said Rule 144, and of the Securities Act and
the Exchange Act, a copy of the most recent annual or quarterly report of the
Company, and such other reports and documents so filed by the Company as
Purchaser may reasonably request in writing in complying with any rule or
regulation of the SEC allowing Purchaser to sell any such securities without
registration.

     

    13.       Indemnification.

     

    13.1 Indemnification by the
Company.  The Company shall, notwithstanding any termination of
this Agreement, indemnify and hold harmless Purchaser, its officers, directors,
partners, members, agents and employees, each Person who controls Purchaser
(within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act) and the officers, directors, partners, members, agents and
employees of each such controlling Person, to the fullest extent permitted by
applicable law, from and against any and all losses, claims, damages,
liabilities, settlement costs and expenses, including, without limitation,
reasonable attorneys’ fees (collectively, “Losses”), as
incurred, arising out of or relating to: (i) any material misrepresentation or
material breach of any representation or warranty made by the Company in the
Transaction Documents or any other certificate, instrument or document
contemplated hereby or thereby; (ii) any breach of any covenant, agreement or
obligation of the Company contained in the Transaction Documents or any other
certificate, instrument or document contemplated hereby or thereby; (iii) any
cause of action, suit or claim brought or made against such Indemnified Party
(as defined in Section
13.2 hereof) by a third party (including for these purposes a derivative
action brought on behalf of the Company), arising out of or resulting from (x)
the execution, delivery, performance or enforcement of the Transaction Documents
or any other certificate, instrument or document contemplated hereby or thereby,
(y) any transaction financed or to be financed in whole or in part, directly or
indirectly, with the proceeds of the issuance of the Securities, or (z) the
status of Indemnified Party as holder of the Securities; or (iv) any untrue or
alleged untrue statement of a material fact contained in the Registration
Statement or any form of Company prospectus or in any amendment or supplement
thereto or in any Company preliminary prospectus, or arising out of or relating
to any omission or alleged omission of a material fact required to be stated
therein or necessary to make the statements therein (in the case of any form of
prospectus or supplement thereto, in the light of the circumstances under which
they were made) not misleading, except to the extent, but only to the extent,
that (A) such untrue statements, alleged untrue statements, omissions or alleged
omissions are based solely upon information regarding Purchaser furnished in
writing to the Company by Purchaser for use therein, or to the extent that such
information relates to Purchaser or Purchaser’s proposed method of distribution
of Registrable Securities and was reviewed and expressly approved by Purchaser
expressly for use in the Registration Statement, or (B) with respect to any
prospectus, if the untrue statement or omission of material fact contained in
such prospectus was corrected on a timely basis in the prospectus, as then
amended or supplemented, if such corrected prospectus was timely made available
by the Company to Purchaser, and Purchaser seeking indemnity hereunder was
advised in writing not to use the incorrect prospectus prior to the use giving
rise to Losses.  Notwithstanding anything contained herein to the
contrary, no Indemnifying Party (as hereinafter defined) shall be obligated to
indemnify an Indemnified Party (as hereinafter defined) hereunder for that
portion of any Losses that have been the result of the gross negligence or
willful misconduct of such Indemnified Party or the breach of a Transaction
Document by an Indemnified Party.

     

    
      
         


      

      
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    13.2 Conduct of Indemnification
Proceedings.  If any Proceeding shall be brought or asserted
against any Person entitled to indemnity hereunder (an “Indemnified Party”),
such Indemnified Party shall promptly notify the Person from whom indemnity is
sought (the “Indemnifying Party”)
in writing, and the Indemnifying Party shall assume the defense thereof,
including the employment of counsel reasonably satisfactory to the Indemnified
Party and the payment of all fees and expenses incurred in connection with
defense thereof; provided, that the failure of any Indemnified Party to give
such notice shall not relieve the Indemnifying Party of its obligations or
liabilities pursuant to this Agreement, except (and only) to the extent that it
shall be finally determined by a court of competent jurisdiction (which
determination is not subject to appeal or further review) that such failure
shall have proximately and materially adversely prejudiced the Indemnifying
Party.

     

    An
Indemnified Party shall have the right to employ separate counsel in any such
Proceeding and to participate in the defense thereof, but the fees and expenses
of such counsel shall be at the expense of such Indemnified Party or Parties
unless: (i) the Indemnifying Party has agreed in writing to pay such fees and
expenses; (ii) the Indemnifying Party shall have failed promptly to assume the
defense of such Proceeding and to employ counsel reasonably satisfactory to such
Indemnified Party in any such Proceeding; or (iii) the named parties to any such
Proceeding (including any impleaded parties) include both such Indemnified Party
and the Indemnifying Party, and such Indemnified Party shall have been advised
by counsel that a conflict of interest is likely to exist if the same counsel
were to represent such Indemnified Party and the Indemnifying Party (in which
case, if such Indemnified Party notifies the Indemnifying Party in writing that
it elects to employ separate counsel at the expense of the Indemnifying Party,
the Indemnifying Party shall not have the right to assume the defense thereof
and the reasonable fees and expenses of separate counsel shall be at the expense
of the Indemnifying Party).  It shall be understood, however, that the
Indemnifying Party shall not, in connection with any one such Proceeding
(including separate Proceedings that have been or will be consolidated before a
single judge) be liable for the fees and expenses of more than one separate firm
of attorneys at any time for all Indemnified Parties, which firm shall be
appointed by a majority of the Indemnified Parties.  The Indemnifying
Party shall not be liable for any settlement of any such Proceeding effected
without its written consent, which consent shall not be unreasonably
withheld.  No Indemnifying Party shall, without the prior written
consent of the Indemnified Party, effect any settlement of any pending
Proceeding in respect of which any Indemnified Party is a party, unless such
settlement includes an unconditional release of such Indemnified Party from all
liability on claims that are the subject matter of such Proceeding.

     

    
      
         


      

      
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    All reasonable fees and expenses of the
Indemnified Party required to be paid by an Indemnifying Party (including
reasonable fees and expenses to the extent incurred in connection with
investigating or preparing to defend such Proceeding in a manner not
inconsistent with this Section 13.2) shall be paid to the Indemnified Party, as
incurred, within 20 Trading Days (defined below) of written notice thereof to
the Indemnifying Party (regardless of whether it is ultimately determined that
an Indemnified Party is not entitled to indemnification hereunder; provided,
that the Indemnifying Party may require such Indemnified Party to undertake to
reimburse all such fees and expenses to the extent it is finally judicially
determined that such Indemnified Party is not entitled to indemnification
hereunder). For purposes of this Agreement, “Trading Day” means
(i) a day on which the Common Stock is traded or is eligible to be traded on a
Trading Market, or (ii) if the Common Stock is not listed on a Trading Market, a
day on which the Common Stock is traded or is eligible to be traded in the
over-the-counter market, as reported by the OTC Bulletin Board, or (iii) if the
Common Stock is not quoted on any Trading Market, a day on which the Common
Stock is quoted in the over-the-counter market as reported by the Pink Sheets
LLC (or any similar organization or agency succeeding to its functions of
reporting prices); provided, that in the event that the Common Stock is not
listed or quoted as set forth in (i), (ii) and (iii) hereof, then Trading Day
shall mean a Business Day.  “Trading Market” means
whichever of the NYSE AMEX Equities, the Nasdaq Capital Market, the Nasdaq
Global Market, the Nasdaq Global Select Market, the New York Stock Exchange or
the OTC Bulletin Board (or any successors to any of the foregoing) on which the
Common Stock is listed or quoted for trading on the date in
question.

    


    13.3 Contribution.  If
a claim for indemnification under Section 13.1(iv) is
unavailable to an Indemnified Party (by reason of public policy or otherwise),
then each Indemnifying Party, in lieu of indemnifying such Indemnified Party,
shall contribute to the amount paid or payable by such Indemnified Party as a
result of such Losses, in such proportion as is appropriate to reflect the
relative fault of the Indemnifying Party and Indemnified Party in connection
with the actions, statements or omissions that resulted in such Losses as well
as any other relevant equitable considerations.  The relative fault of
such Indemnifying Party and Indemnified Party shall be determined by reference
to, among other things, whether any action in question, including any untrue or
alleged untrue statement of a material fact or omission or alleged omission of a
material fact, has been taken or made by, or relates to information supplied by,
such Indemnifying Party or Indemnified Party, and the parties’ relative intent,
knowledge, access to information and opportunity to correct or prevent such
action, statement or omission.  The amount paid or payable by a party
as a result of any Losses shall be deemed to include, subject to the limitations
set forth in Section
13.2, any reasonable attorneys’ or other reasonable fees or expenses
incurred by such party in connection with any Proceeding to the extent such
party would have been indemnified for such fees or expenses if the
indemnification provided for in this Section 13.3 was
available to such party in accordance with its terms.

     

    The
parties hereto agree that it would not be just and equitable if contribution
pursuant to this Section 13.3 were
determined by pro rata
allocation or by any other method of allocation that does not take into
account the equitable considerations referred to in the immediately preceding
paragraph.  Notwithstanding the provisions of this Section 13.3,
Purchaser shall not be required to contribute, in the aggregate, any amount in
excess of the amount by which the proceeds actually received by Purchaser from
the sale of the Registrable Securities subject to the Proceeding exceed the
amount of any damages that such Purchaser has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission.  No Person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any Person who was
not guilty of such fraudulent misrepresentation.

     

    
      
         


      

      
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    The
indemnity and contribution agreements contained in this Section 13.3 are in
addition to any liability that the Indemnifying Parties may have to the
Indemnified Parties.

     

    14.           Miscellaneous.

     

    14.1 Termination.  This
Agreement may be terminated by the Company or Purchaser, by written notice to
the other parties, if the Closing has not been consummated by 11:00 a.m. on
October 11, 2010; provided that no such termination will affect the right of any
party to sue for any breach by the other party (or parties).

     

    14.2 Fees and
Expenses.

     

    (i)       Except
as expressly set forth in the Transaction Documents to the contrary, each party
shall pay the fees and expenses of its advisers, counsel, accountants and other
experts, if any, and all other expenses incurred by such party incident to the
negotiation, preparation, execution, delivery and performance of this
Agreement.

     

    (ii)      The
Company agrees to reimburse Purchaser at the Closing (or, at Purchaser’s option,
promptly thereafter) for all reasonable legal fees, due diligence expenses and
other reasonable expenses incurred for services relating to the transactions
contemplated herein, including any reasonable legal fees and other reasonable
expenses related to Purchaser’s review of the Company’s compliance with
post-closing covenants, including those related to delivery of perfected
security interests in Baja Inventory, Kali Inventory and subsequently-acquired
shares of Baja, provided that travel expenses in excess of five thousand dollars
($5,000) shall be pre-approved by the Company.  An estimated portion
of such reimbursement amount (net of any amounts previously advanced by the
Company) may, at the option of Purchaser, be paid by offset against the cash
purchase price payable for the Notes purchased at the Closing. The foregoing
reimbursement obligation of the Company shall be enforceable by Purchaser
regardless of whether the Closing occurs.

     

    (iii)     In
addition to the reimbursement obligation of the Company set forth in Section
14.2(ii) above, during the period of time in which all of, or a portion of, the
principal amount of the Notes remain outstanding, the Company agrees to
reimburse Purchaser for reasonable legal fees and other reasonable expenses
incurred for in connection with Purchaser’s enforcement of its rights under the
Transaction Documents, including costs of negotiating any future subordination
or loan extension arrangement with the Company or third party
lenders.

     

    14.3 Entire
Agreement.  The Transaction Documents, together with the
exhibits and schedules thereto, contain the entire understanding of the parties
with respect to the subject matter hereof and supersede all prior agreements and
understandings, oral or written, with respect to such matters, which the parties
acknowledge have been merged into such documents, exhibits and
schedules.  At or after the Closing, and without further
consideration, the Company will execute and deliver to Purchaser such further
documents as may be reasonably requested in order to give practical effect to
the intention of the parties under the Transaction Documents.

     

    
      
         


      

      
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    14.4  Notices.  Any
and all notices or other communications or deliveries required or permitted to
be provided hereunder shall be in writing and shall be deemed given and
effective on the earliest of (a) the date of transmission, if such notice or
communication is delivered via facsimile or email at the facsimile number or
email address specified in this Section 14.4 prior to 6:30 p.m. (New York
City time) on a Trading Day, (b) the next Trading Day after the date of
transmission, if such notice or communication is delivered via facsimile or
email at the facsimile number or email address specified in this
Section 14.4 on a day that is not a Trading Day or later than 6:30 p.m.
(New York City time) on any Trading Day, (c) the Trading Day following the date
of deposit with a nationally recognized overnight courier service, or (d) upon
actual receipt by the party to whom such notice is required to be
given.  The addresses, facsimile numbers and email addresses for such
notices and communications are those set forth on the signature pages hereof, or
such other address or facsimile number as may be designated in writing
hereafter, in the same manner, by any such Person.

     

    14.5  Amendments;
Waivers.  No provision of this Agreement may be waived or
amended except in a written instrument signed, in the case of an amendment, by
the Company and Purchaser or, in the case of a waiver, by the party against whom
enforcement of any such waiver is sought.  No waiver of any default
with respect to any provision, condition or requirement of this Agreement shall
be deemed to be a continuing waiver in the future or a waiver of any subsequent
default or a waiver of any other provision, condition or requirement hereof, nor
shall any delay or omission of any party to exercise any right hereunder in any
manner impair the exercise of any such right.

     

    14.6  Construction.  The
headings herein are for convenience only, do not constitute a part of this
Agreement and shall not be deemed to limit or affect any of the provisions
hereof.  The language used in this Agreement will be deemed to be the
language chosen by the parties to express their mutual intent, and no rules of
strict construction will be applied against any party.

     

    14.7  Successors and
Assigns.  This Agreement shall be binding upon and inure to the
benefit of the parties and their successors and permitted
assigns.  The Company may not assign this Agreement or any rights or
obligations hereunder without the prior written consent of
Purchaser.  Purchaser may assign its rights under this Agreement to
any Person to whom Purchaser assigns or transfers or will assign or transfer
(including by way of distribution to its members, partners or stockholders) any
Securities, provided (i) such transferor agrees in writing with the transferee
or assignee to assign such rights, and a copy of such agreement is furnished to
the Company after such assignment, (ii) at least five days prior to such
assignment, the Company is furnished with written notice of (x) the name and
address of such transferee or assignee and (y) the Registrable Securities with
respect to which such registration rights are being transferred or assigned,
(iii) following such transfer or assignment, the further disposition of such
securities by the transferee or assignee is restricted under the Securities Act
and applicable state securities laws, (iv) such transferee agrees in writing to
be bound, with respect to the transferred Securities, by the provisions hereof
that apply to the “Purchaser” and (v) such transfer shall have been made in
accordance with the applicable requirements of this Agreement and with all laws
applicable thereto.

     

    
      
         


      

      
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    14.8  No Third-Party
Beneficiaries.  This Agreement is intended for the benefit of
the parties hereto, and their respective successors and permitted assigns and is
not for the benefit of, nor may any provision hereof be enforced by, any other
Person, except that each Indemnified Party is an intended third-party
beneficiary of Section 13 and (in each case) may enforce the provisions of such
section directly against the parties with obligations thereunder.

     

    14.9  Governing Law; Venue; Waiver
of Jury Trial. ALL QUESTIONS CONCERNING THE CONSTRUCTION, VALIDITY,
ENFORCEMENT AND INTERPRETATION OF THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.  THE
COMPANY AND PURCHASER HEREBY IRREVOCABLY SUBMIT TO THE NON-EXCLUSIVE
JURISDICTION OF THE STATE AND FEDERAL COURTS SITTING IN THE CITY OF NEW YORK,
BOROUGH OF MANHATTAN FOR THE ADJUDICATION OF ANY DISPUTE BROUGHT BY THE COMPANY
OR ANY PURCHASER HEREUNDER, IN CONNECTION HEREWITH OR WITH ANY TRANSACTION
CONTEMPLATED HEREBY OR DISCUSSED HEREIN (INCLUDING WITH RESPECT TO THE
ENFORCEMENT OF ANY OF THE TRANSACTION DOCUMENTS), AND HEREBY IRREVOCABLY WAIVE,
AND AGREE NOT TO ASSERT IN ANY SUIT, ACTION OR PROCEEDING BROUGHT BY THE COMPANY
OR ANY PURCHASER, ANY CLAIM THAT IT IS NOT PERSONALLY SUBJECT TO THE
JURISDICTION OF ANY SUCH COURT, OR THAT SUCH SUIT, ACTION OR PROCEEDING IS
IMPROPER.  EACH PARTY HEREBY IRREVOCABLY WAIVES PERSONAL SERVICE OF
PROCESS AND CONSENTS TO PROCESS BEING SERVED IN ANY SUCH SUIT, ACTION OR
PROCEEDING BY MAILING A COPY THEREOF VIA REGISTERED OR CERTIFIED MAIL OR
OVERNIGHT DELIVERY (WITH EVIDENCE OF DELIVERY) TO SUCH PARTY AT THE ADDRESS IN
EFFECT FOR NOTICES TO IT UNDER THIS AGREEMENT AND AGREES THAT SUCH SERVICE SHALL
CONSTITUTE GOOD AND SUFFICIENT SERVICE OF PROCESS AND NOTICE
THEREOF.  NOTHING CONTAINED HEREIN SHALL BE DEEMED TO LIMIT IN ANY WAY
ANY RIGHT TO SERVE PROCESS IN ANY MANNER PERMITTED BY LAW.  THE
COMPANY AND PURCHASER HEREBY WAIVE ALL RIGHTS TO A TRIAL BY JURY.

     

    14.10             Survival.  The
representations and warranties, agreements and covenants contained herein shall
survive the Closing.

     

    14.11             Execution.  This
Agreement may be executed in two or more counterparts, all of which when taken
together shall be considered one and the same agreement and shall become
effective when counterparts have been signed by each party and delivered to the
other party, it being understood that both parties need not sign the same
counterpart.  In the event that any signature is delivered by
facsimile transmission or email attachment, such signature shall create a valid
and binding obligation of the party executing (or on whose behalf such signature
is executed) with the same force and effect as if such facsimile or
email-attached signature page were an original thereof.

     

    14.12             Severability.  If
any provision of this Agreement is held to be invalid or unenforceable in any
respect, the validity and enforceability of the remaining terms and provisions
of this Agreement shall not in any way be affected or impaired thereby and the
parties will attempt to agree upon a valid and enforceable provision that is a
reasonable substitute therefor, and upon so agreeing, shall incorporate such
substitute provision in this Agreement.

     

    
      
         


      

      
        36

        
          

        

      

      
         


      

    

     

    14.13             Rescission and Withdrawal
Right.  Notwithstanding anything to the contrary contained in
(and without limiting any similar provisions of) the Transaction Documents,
whenever the Purchaser exercises a right, election, demand or option owed to
such Purchaser by the Company under a Transaction Document and the Company does
not timely perform its related obligations within the periods therein provided,
then, prior to the performance by the Company of the Company’s related
obligation, Purchaser may rescind or withdraw, in its sole discretion from time
to time upon written notice to the Company, any relevant notice, demand or
election in whole or in part without prejudice to its future actions and
rights.

     

    14.14             Replacement of
Securities.  If any certificate or instrument evidencing any
Securities is mutilated, lost, stolen or destroyed, the Company shall issue or
cause to be issued in exchange and substitution for and upon cancellation
thereof, or in lieu of and substitution therefor, a new certificate or
instrument, but only upon receipt of evidence reasonably satisfactory to the
Company of such loss, theft or destruction and the execution by the holder
thereof of a customary lost certificate affidavit of that fact and an agreement
to indemnify and hold harmless the Company for any losses in connection
therewith.  The applicants for a new certificate or instrument under
such circumstances shall also pay any reasonable third-party costs associated
with the issuance of such replacement Securities.

     

    14.15             Remedies.  In
addition to being entitled to exercise all rights provided herein or granted by
law, including recovery of damages, Purchaser and the Company will be entitled
to seek specific performance under the Transaction Documents.  The
parties agree that monetary damages may not be adequate compensation for any
loss incurred by reason of any breach of obligations described in the foregoing
sentence and hereby agree to waive in any action for specific performance of any
such obligation (other than in connection with any action for a temporary
restraining order) the defense that a remedy at law would be
adequate.

     

    14.16             Payment Set
Aside.  To the extent that the Company makes a payment or
payments to Purchaser hereunder or Purchaser enforces or exercises its rights
hereunder, and such payment or payments or the proceeds of such enforcement or
exercise or any part thereof are subsequently invalidated, declared to be
fraudulent or preferential, set aside, recovered from, disgorged by or are
required to be refunded, repaid or otherwise restored to the Company by a
trustee, receiver or any other person under any law (including, without
limitation, any bankruptcy law, state or federal law, common law or equitable
cause of action), then to the extent of any such restoration the obligation or
part thereof originally intended to be satisfied shall be revived and continued
in full force and effect as if such payment had not been made or such
enforcement or setoff had not occurred.

     

    14.17             Adjustments in Share Numbers
and Prices.  In the event of any stock split, subdivision,
dividend or distribution payable in shares of Common Stock (or other securities
or rights convertible into, or entitling the holder thereof to receive directly
or indirectly shares of Common Stock), combination or other similar
recapitalization or event occurring after the date hereof, each reference in any
Transaction Document to a number of shares or a price per share shall be amended
to appropriately account for such event.

     

    
      
         


      

      
        37

        
          

        

      

      
         


      

    


    14.18    Public
Announcement.  From and after the Closing, and while any Note
is outstanding, the Company and Purchaser will not disclose, shall not cause any
Person to disclose, and will not include or cause any Person to include in any
public announcement, the name of the other party to this Agreement, unless
expressly agreed to by such other party or unless and until such disclosure is
required by applicable law or applicable regulation, and then only to the extent
of such requirement..

     

    [SIGNATURE
PAGE FOLLOWS]

     

    
      
         


      

      
        38

        
          

        

      

      
         


      

    

     

    IN
WITNESS WHEREOF, the parties hereto have executed this Note and Warrant Purchase
Agreement on the date first above written.

     

    
      
        
          
            
              	 
      	
                      THE
      COMPANY:

                    
	 	 
	 
      	
                      UMAMI
      SUSTAINABLE SEAFOOD INC.

                    
	 	 
	 
      	
                      By:

                    	
                       
        

                    
	 
      	
                      Name:
      Oli Valur Steindorsson

                    
	 
      	
                      Title:  President
      and Chief Executive Officer

                    
	 
      	 
      
	 
      	
                      Address:

                    
	 
      	
                      405
      Lexington Avenue

                    
	 
      	
                      26th
      Floor, Suite 2640

                    
	 
      	
                      New
      York, NY
10174

                    


            

          

        

      

    

    


    
      
        	 
      	
                PURCHASER:

              
	 
      	 
      
	 
      	
                UTA
      CAPITAL LLC

              
	 
      	
                By
      YZT Management LLC, its Managing
Member

              


      

    

    


    
      
        
          	 
      	
                  By:

                	
                   
        

                
	 
      	
                  Name:

                	
                  Udi
      Toledano

                
	 
      	
                  Title:

                	
                  Managing
      Member

                


        

      

    

    


    
      
        	 
      	
                Address:

              
	 
      	
                100
      Executive Drive

              
	 
      	
                Suite
      330

              
	 
      	
                West
      Orange, NJ 07052

              
	 
      	
                Facsimile:
      973-736-0201

              


      

    


    
      
         


      

      
        39

        
          

        

      

      
         


      

    

     

    
      EXECUTION
COPY
 

    

    SCHEDULE
1

     

    
      
        
          
            	 
      	 	 	 	 	
                    If EBITDA

                  	 	 	
                    And EBITDA

                  	 	 	
                    Then

                  	 
	 
      	 	
                    Estimated

                  	 	 	
                    per share is

                  	 	 	
                    Per share is

                  	 	 	
                    additional

                  	 
	
                    Implied

                  	 	
                    Fully diluted

                  	 	 	
                    Equal to or

                  	 	 	
                    greater

                  	 	 	
                    interest

                  	 
	
                    EBITDA (US$)

                  	 	
                    Common shares

                  	 	 	
                    Less than *

                  	 	 	
                    Than *

                  	 	 	
                    due is (US$)

                  	 
	
                     23,946,000

                  	 	 	61,400,000	 	 	$	0.3900	 	 	$	0.3750	 	 	 	300,000	 
	
                     23,025,000

                  	 	 	61,400,000	 	 	$	0.3750	 	 	$	0.3600	 	 	 	600,000	 
	
                     22,104,000

                  	 	 	61,400,000	 	 	$	0.3600	 	 	$	0.3400	 	 	 	900,000	 
	
                     20,876,000

                  	 	 	61,400,000	 	 	$	0.3400	 	 	$	0.3250	 	 	 	1,200,000	 
	
                     19,955,000

                  	 	 	61,400,000	 	 	$	0.3250	 	 	$	-	 	 	 	1,500,000	 


          

        

      

    

     

    
      
        	
                *

              	
                The
      EBITDA amounts reflected in this Schedule 1 are subject to adjustment
      pursuant to
Section  6.2(b)(iv).

              


      

    

     

    
      
         


      

      
        40

        
          

        

      

      
         


      

    


    
      EXHIBIT
A-1

    

     

    Form of
Promissory Note

     

    (The
First Note)


    
      
         


      

      
        41

        
          

        

      

      
         


      

    


    EXHIBIT
A-2

     

    Form of
Promissory Note

     

    (The
Second Note)


    
      
         


      

      
        42

        
          

        

      

      
         


      

    


    EXHIBIT
B

     

    Form of
Common Stock Purchase Warrant


    
      
         


      

      
        43

        
          

        

      

      
         


      

    


    EXHIBIT
C

     

    Form of
Company Bluefin Pledge and Security Agreement


    
      
         


      

      
        44

        
          

        

      

      
         


      

    


     EXHIBIT
D

     

    Form of
Company Baja Pledge Agreement


    
      
         


      

      
        45

        
          

        

      

      
         


      

    


     EXHIBIT
E

     

    Form of
Baja Subsidiary Guarantee Agreement


    
      
         


      

      
        46

        
          

        

      

      
         


      

    


    EXHIBIT
F

     

    Form of
Bluefin Subsidiary Guarantee

     

    
      
        
        

      

      
        47

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
G-1

     

    Form of
Loeb and Loeb Opinion


    
      
         


      

      
        48

        
          

        

      

      
         


      

    


    EXHIBIT
G-2

     

    Form of
Lionel Sawyer & Collins Opinion

     


    
      
         


      

      
        49