Document:

EXHIBIT
10.1

 

 

ASSET PURCHASE AGREEMENT

by and among

RADER FARMS ACQUISITION CORP.,

RADER FARMS INC. and the COMPANY SHAREHOLDERS

Dated as of May 17, 2007

 

TABLE OF CONTENTS

	
  

  	
   

  	
  Page

  
	
  ARTICLE 1

  	
  DEFINITIONS

  	
  1

  
	
   

  	
   

  	
   

  
	
  1.1

  	
  Definitions

  	
  1

  
	
   

  	
   

  	
   

  
	
  1.2

  	
  Other Definitions

  	
  7

  
	
   

  	
   

  	
   

  
	
  ARTICLE 2

  	
  PURCHASE
  AND SALE OF ASSETS

  	
  8

  
	
   

  	
   

  	
   

  
	
  2.1

  	
  Purchased Assets

  	
  8

  
	
   

  	
   

  	
   

  
	
  2.2

  	
  Limited Assumption of Liabilities

  	
  10

  
	
   

  	
   

  	
   

  
	
  2.3

  	
  Closing; Conditions to Closing; Closing Transactions

  	
  11

  
	
   

  	
   

  	
   

  
	
  2.4

  	
  Purchase Price

  	
  12

  
	
   

  	
   

  	
   

  
	
  2.5

  	
  Transfer of Title

  	
  12

  
	
   

  	
   

  	
   

  
	
  2.6

  	
  Prorations and Closing Costs

  	
  12

  
	
   

  	
   

  	
   

  
	
  2.7

  	
  Purchase Price Adjustment

  	
  12

  
	
   

  	
   

  	
   

  
	
  2.8

  	
  Nonassignable Contracts

  	
  14

  
	
   

  	
   

  	
   

  
	
  2.9

  	
  Post-Closing Amounts Received and Paid

  	
  14

  
	
   

  	
   

  	
   

  
	
  2.10

  	
  Escrow

  	
  15

  
	
   

  	
   

  	
   

  
	
  ARTICLE 3

  	
  DELIVERABLES

  	
  16

  
	
   

  	
   

  	
   

  
	
  3.1

  	
  Company Deliverables

  	
  16

  
	
   

  	
   

  	
   

  
	
  3.2

  	
  Buyer’s Deliverables

  	
  17

  
	
   

  	
   

  	
   

  
	
  ARTICLE 4

  	
  REPRESENTATIONS AND WARRANTIES
  OF THE COMPANY AND COMPANY SHAREHOLDERS

  	
  18

  
	
   

  	
   

  	
   

  
	
  4.1

  	
  Organization and Corporate Power

  	
  18

  
	
   

  	
   

  	
   

  
	
  4.2

  	
  Authorization of Transactions

  	
  18

  
	
   

  	
   

  	
   

  
	
  4.3

  	
  Absence of Conflicts

  	
  19

  
	
   

  	
   

  	
   

  
	
  4.4

  	
  Financial Statements

  	
  19

  
	
   

  	
   

  	
   

  
	
  4.5

  	
  Absence of Undisclosed Liabilities

  	
  20

  
	
   

  	
   

  	
   

  
	
  4.6

  	
  Absence of Certain Developments

  	
  20

  
	
   

  	
   

  	
   

  
	
  4.7

  	
  Title to Properties

  	
  21

  
	
   

  	
   

  	
   

  
	
  4.8

  	
  Condition of Facilities

  	
  22

  
	
   

  	
   

  	
   

  
	
  4.9

  	
  Title and Condition of Assets

  	
  22

  
	
   

  	
   

  	
   

  
	
  4.10

  	
  Taxes

  	
  23

  
	
   

  	
   

  	
   

  
	
  4.11

  	
  Contracts and Commitments

  	
  24

  

 

 

	
  4.12

  	
  Proprietary Rights

  	
  26

  
	
   

  	
   

  	
   

  
	
  4.13

  	
  Litigation; Proceedings

  	
  26

  
	
   

  	
   

  	
   

  
	
  4.14

  	
  Brokerage

  	
  27

  
	
   

  	
   

  	
   

  
	
  4.15

  	
  Governmental Authorizations and Permits

  	
  27

  
	
   

  	
   

  	
   

  
	
  4.16

  	
  Employees

  	
  27

  
	
   

  	
   

  	
   

  
	
  4.17

  	
  Employee Benefit Plans

  	
  28

  
	
   

  	
   

  	
   

  
	
  4.18

  	
  Insurance

  	
  29

  
	
   

  	
   

  	
   

  
	
  4.19

  	
  Affiliate Transactions

  	
  30

  
	
   

  	
   

  	
   

  
	
  4.20

  	
  Compliance with Laws

  	
  30

  
	
   

  	
   

  	
   

  
	
  4.21

  	
  Environmental Matters

  	
  30

  
	
   

  	
   

  	
   

  
	
  4.22

  	
  Product Recall

  	
  32

  
	
   

  	
   

  	
   

  
	
  4.23

  	
  Customers and Suppliers

  	
  32

  
	
   

  	
   

  	
   

  
	
  4.24

  	
  Books and Records

  	
  32

  
	
   

  	
   

  	
   

  
	
  4.25

  	
  Disclosure

  	
  32

  
	
   

  	
   

  	
   

  
	
  4.26

  	
  Limitation on Company and Company Shareholders’
  Representations and Warranties

  	
  32

  
	
   

  	
   

  	
   

  
	
  4.27

  	
  Disclosure

  	
  33

  
	
   

  	
   

  	
   

  
	
  ARTICLE 5

  	
  REPRESENTATIONS
  AND WARRANTIES OF BUYER

  	
  33

  
	
   

  	
   

  	
   

  
	
  5.1

  	
  Organization and Corporate Power

  	
  33

  
	
   

  	
   

  	
   

  
	
  5.2

  	
  Authorization of Transactions

  	
  33

  
	
   

  	
   

  	
   

  
	
  5.3

  	
  No Violation

  	
  33

  
	
   

  	
   

  	
   

  
	
  5.4

  	
  Governmental Authorities and Consents

  	
  33

  
	
   

  	
   

  	
   

  
	
  5.5

  	
  Brokerage

  	
  34

  
	
   

  	
   

  	
   

  
	
  5.6

  	
  Disclosure

  	
  34

  
	
   

  	
   

  	
   

  
	
  ARTICLE 6

  	
  INDEMNIFICATION
  AND RELATED MATTERS

  	
  34

  
	
   

  	
   

  	
   

  
	
  6.1

  	
  Survival

  	
  34

  
	
   

  	
   

  	
   

  
	
  6.2

  	
  Indemnification

  	
  35

  
	
   

  	
   

  	
   

  
	
  ARTICLE 7

  	
  ADDITIONAL
  AGREEMENTS

  	
  38

  
	
   

  	
   

  	
   

  
	
  7.1

  	
  Tax Matters

  	
  38

  
	
   

  	
   

  	
   

  
	
  7.2

  	
  Press Releases and Announcements

  	
  40

  
	
   

  	
   

  	
   

  
	
  7.3

  	
  Further Transfers

  	
  40

  
	
   

  	
   

  	
   

  
	
  7.4

  	
  Specific Performance

  	
  40

  
	
   

  	
   

  	
   

  
	
  7.5

  	
  Expenses

  	
  40

  

 

 ii
 

 

	
  7.6

  	
  Non-Competition; Non-Solicitation and
  Confidentiality

  	
  40

  
	
   

  	
   

  	
   

  
	
  7.7

  	
  Employee and Employee Benefit Matters

  	
  43

  
	
   

  	
   

  	
   

  
	
  7.8

  	
  Insurance

  	
  44

  
	
   

  	
   

  	
   

  
	
  7.9

  	
  Transition Services

  	
  44

  
	
   

  	
   

  	
   

  
	
  7.10

  	
  Discharge of Liabilities

  	
  45

  
	
   

  	
   

  	
   

  
	
  7.11

  	
  Use of Names

  	
  45

  
	
   

  	
   

  	
   

  
	
  ARTICLE 8

  	
  MISCELLANEOUS

  	
  45

  
	
   

  	
   

  	
   

  
	
  8.1

  	
  Amendment and Waiver

  	
  45

  
	
   

  	
   

  	
   

  
	
  8.2

  	
  Notices

  	
  45

  
	
   

  	
   

  	
   

  
	
  8.3

  	
  Binding Agreement; Assignment

  	
  46

  
	
   

  	
   

  	
   

  
	
  8.4

  	
  Severability

  	
  46

  
	
   

  	
   

  	
   

  
	
  8.5

  	
  Construction

  	
  46

  
	
   

  	
   

  	
   

  
	
  8.6

  	
  Captions and Headings

  	
  46

  
	
   

  	
   

  	
   

  
	
  8.7

  	
  Entire Agreement

  	
  47

  
	
   

  	
   

  	
   

  
	
  8.8

  	
  Counterparts

  	
  47

  
	
   

  	
   

  	
   

  
	
  8.9

  	
  Governing Law

  	
  47

  
	
   

  	
   

  	
   

  
	
  8.10

  	
  Parties in Interest

  	
  47

  
	
   

  	
   

  	
   

  
	
  8.11

  	
  Consent to Jurisdiction

  	
  47

  
	
   

  	
   

  	
   

  
	
  8.12

  	
  Delivery by Facsimile or Electronic Transmission

  	
  47

  
	
   

  	
   

  	
   

  
	
  8.13

  	
  Attorneys’ Fees

  	
  48

  

 

 iii

ASSET PURCHASE AGREEMENT

THIS ASSET PURCHASE
AGREEMENT (this “Agreement”) is made as of May 17, 2007, by and among
Rader Farms Acquisition Corp., a Delaware corporation and wholly owned
subsidiary of The Inventure Group, Inc., a Delaware corporation (“Buyer”),
Rader Farms Inc., a Washington corporation (the “Company”), and the
shareholders of the Company listed on Schedule I (the “Company
Shareholders”).  Buyer, the Company
and the Company Shareholders are collectively referred to herein as the “Parties”
and each individually is referred to as a “Party.”

WHEREAS, on the terms and
subject to the conditions set forth in this Agreement, Buyer desires to acquire
from the Company, and the Company desires to sell to Buyer, certain assets and
properties used in or relating to the vegetable and berry growing business
conducted by the Company as of the Closing Date, including without limitation
the planting, growing, farming, harvesting, freezing, packaging, distributing
and selling of raspberries, blueberries, marionberries, cranberries, dark sweet
cherries, strawberries and rhubarb under the Rader Farms brand name (the “Business”), and
Buyer desires to assume, and the Company desires to assign and transfer,
certain liabilities of the Company primarily incurred in connection with the
Business, in each case as more fully set forth herein; and

WHEREAS, the Company
Shareholders acknowledge that they will be substantially benefited by the
transactions contemplated by this Agreement, and as a material inducement to
Buyer’s willingness to enter into this Agreement, which Buyer would not enter
into absent the Company Shareholders’ execution of this Agreement, the Company
Shareholders have agreed to join in this Agreement as contemplated herein;

NOW, THEREFORE, in
consideration of the mutual benefits to be derived from this Agreement and the
representations, warranties, promises and covenants set forth herein, the
Parties hereto agree as follows:

ARTICLE
1

DEFINITIONS

1.1   Definitions.  For purposes of this Agreement, the following
terms shall have the meanings set forth below:

“Accounts Receivable”
means all notes and accounts receivable of the Company relating to the Business
as of the Closing Date.

“Affiliate” of any
particular Person means any other Person controlling, controlled by or under
common control with such particular Person, where “control” means the
possession, directly or indirectly, of the power to direct the management and
policies of a Person whether through the ownership of voting securities or
otherwise.

“Buildings, Improvements
and Fixtures” means all buildings, improvements, fixtures, furniture and
fittings located at the Owned Real Property.

“Business Day” means
each Monday, Tuesday, Wednesday, Thursday or Friday which is not a day on which
banking institutions in Phoenix, Arizona are authorized or obligated to close
by law.

“CERCLA” means the
Comprehensive Environmental Response, Compensation and Liability Act of 1980,
as amended from time to time.

“COBRA” means Part 6
of Subtitle B of Title I of ERISA, Section 4980B of the Code, and any
similar state law.

“Code” means the
Internal Revenue Code of 1986, as amended, and regulations promulgated
thereunder.

“Contract” means any
contract, license, sublicense, franchise, permit, mortgage, purchase order,
indenture, loan agreement, note, Lease, sublease, agreement, obligation,
commitment, instrument or other written agreement or commitment to enter into
any of the foregoing.

“Customer List” means
the list of customers of the Business listed on Schedule 1.1
attached hereto, which list also includes the gross amount received from each
such customer during the fiscal year ended December 31, 2006.

“Deposits and Prepaid
Expenses” means deposits and prepaid expenses, other than prepaid income
taxes, attributable to the Business as of the Closing Date.

“Environmental and Safety
Requirements” means all federal, state, local and foreign statutes,
regulations, ordinances and other provisions having the force or effect of law,
all judicial and administrative orders and determinations, all contractual
obligations and all common law, in each case concerning public health and
safety, worker health and safety and pollution or protection of the
environment, including all those relating to the presence, use, production,
generation, handling, transport, treatment, storage, disposal, distribution,
labeling, testing, processing, discharge, Release, threatened Release, control
or cleanup of any hazardous or otherwise regulated materials, substances or
wastes, chemical substances or mixtures, pesticides, pollutants, contaminants,
toxic chemicals, petroleum products or byproducts, asbestos, polychlorinated
biphenyls, noise, odor or radiation, as the foregoing are enacted and in effect
prior to or on the Closing Date.

“Environmental Lien”
means any Lien, whether recorded or unrecorded, in favor of any governmental
entity, relating to any liability of the Company arising under any
Environmental and Safety Requirements.

“ERISA” means the
Employee Retirement Income Security Act of 1974, as amended from time to time.

“Equipment” means all
vehicles, machinery, equipment, tools, computers and other tangible personal
property and assets used in the Business.

 2
 

“Excluded Liabilities”
means any Liabilities arising out of, relating to, resulting from or caused by
any transaction, status, event, condition, occurrence or situation existing,
arising or occurring (i) in connection with the ownership or operation of
the Business and/or the Purchased Assets on or prior to the Closing Date or
(ii) in connection with the Company’s businesses or activities at any time
prior to, on or after the Closing Date, in each case other than the Assumed
Liabilities.  Without limiting the
generality of the foregoing, Excluded Liabilities shall include (a) Liabilities
of the Company under the Transaction Documents to which the Company is a party,
(b) except to the extent (but only to the extent) reflected in any
negative adjustment of the Purchase Price under Section 2.7,
Liabilities for any claims (whenever made) or proceedings arising out of,
relating to, resulting from or caused by the operation of the Business or any
products grown, manufactured, packaged, distributed or sold by the Company with
respect to the Business at any time on or prior to the Closing Date;
(c) Liabilities for any Indebtedness or any other payment owed to a third
party by the Company or Taxes including any assessments, claims or liabilities
(including interest and/or penalties) for Taxes relating to, imposed upon or
assessed against the Purchased Assets, the Business or the sales, income,
property or business of the Company in each instance for periods ending on or
before the Closing Date and/or resulting from the sale or transfer of the
Purchased Assets hereunder, and (d) any claim, damage, fine or penalty (including
interest) arising from events occurring prior to the Closing Date for personal
injury, property damage, violation of immigration laws or employee welfare and
safety laws, employment discrimination or infringement relating to the Company’s
use of any intellectual property.

“GAAP” means
generally accepted accounting principles in the United States.

“Governmental Authority”
means any government, whether federal, state or local, or any other political
subdivision thereof, or any agency, tribunal or instrumentality of any such
governmental or political subdivision, or any other Person exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government.

“Hazardous Substance”
means any substance or material that is considered, described, characterized or
listed as a toxic or hazardous substance, waste or material, or a pollutant, or
a contaminant or an infectious waste, or words of similar import, in or under
any applicable Environmental and Safety Requirements, or chemicals, substances,
materials or compounds that are otherwise subject to regulation, prohibition,
control or remediation under or that give rise to liability under, any
applicable Environmental and Safety Requirements, and includes without limitation
asbestos, petroleum and petroleum products, methyl tertiary-butyl ether,
polychlorinated biphenyls, urea formaldehyde, radon gas and radioactive matter.

“Indebtedness” means
(i) any indebtedness for borrowed money or issued in substitution for or
exchange of indebtedness for borrowed money, (ii) any indebtedness
evidenced by any note, bond, debenture or other debt security, (iii) any
indebtedness for the deferred purchase price of property or services with
respect to which a Person is liable, contingently or otherwise, as obligor or
otherwise, (iv) any commitment by which a Person assures a creditor
against loss (including contingent reimbursement Liabilities with respect to
letters of credit), (v) any indebtedness guaranteed in any manner by a
Person (including guarantees in the form of an agreement to repurchase or
reimburse), (vi) any Liabilities under capitalized leases with respect to
which a Person is liable, contingently or otherwise, as obligor, 

 3
 

guarantor or otherwise,
or with respect to which Liabilities a Person assures a creditor against loss,
(vii) any indebtedness secured by a Lien on a Person’s assets, and
(viii) all Liabilities (including increased obligations) of the Business
arising in whole or in part from the transactions contemplated hereby
(including transaction bonuses, retention bonuses and severance obligations);
together with, in each case, interest, penalties, redemption premiums, and
prepayment obligations.

“IT Assets” means the
computers, computer software, firmware, middleware, servers, workstations,
routers, hubs, switches, data communications lines, and all other information
technology equipment, and all associated documentation, owned or leased by the
Company, part of which is used in the operation of the Business.

“Inventory” means
seeds and plants at all stages of growth and harvesting, raw materials,
work-in-process, finished goods, inventories, repair and replacement parts,
collateral materials and supplies.

“Knowledge” as used
in the phrases “to the Knowledge of the Company”, “to the Company’s Knowledge”
or phrases of similar import means (i) the actual knowledge or awareness
of Lyle Rader, Sue Rader, Brad Rader and Tara Lambert and (ii) the
knowledge or awareness of such individuals which a prudent business person
would have obtained in the conduct of his business after making reasonable
inquiry and exercising reasonable diligence with respect to the particular
matter in question.

“Lease” means all of the right, title and interest of the Company
in the written leases, subleases, licenses, concessions, leasehold improvements
and any other agreements in the nature of a lease, including the right to all
security deposits and other amounts and instruments deposited by or on behalf
of the Company for the Business.

“Letter of Intent”
means that certain letter agreement between The Inventure Group, Inc. and the
Company dated as of March 19, 2007.

“Liability” means any
liability, debt, obligation, deficiency, Tax, penalty, assessment, fine, claim,
cause of action or other loss, fee, cost or expense of any kind or nature
whatsoever, whether asserted or unasserted, absolute or contingent, known or
unknown, accrued or unaccrued, liquidated or unliquidated, and whether due or
to become due and regardless of when asserted.

“Lien” means any
mortgage, pledge, security interest, purchase money interest, encumbrance,
claim, Tax, lien or charge of any kind (including any conditional sale or other
title retention agreement or lease in the nature thereof) or any agreement to
file any of the foregoing, any sale of receivables with recourse against the
Company or any of its Affiliates, and any filing or agreement to file a
financing statement as debtor under the Uniform Commercial Code or any similar
statute.

“Material” shall be
interpreted based on a reasonable purchaser’s view after considering the
context in which the term is used, but in no event shall it include any matter
that, results in or might result in costs, expenses, damages, payments or other
Liabilities of, to or 

 4
 

involving,
or claims by or against the Business involving less than $5,000.00 or, taken in
the aggregate with all other related matters, involving less than $50,000.00.

“Material Adverse Effect”
means an event, transaction, condition or change which has had or could reasonably
be expected to have a Material adverse effect on the business, assets,
condition (financial or otherwise), or operating results of the Business;

“Ordinary Course of Business” means in the ordinary course of
business, consistent with past practice.

“Owned Real Property” means  the real property owned by Lyle Rader, Sue
Rader, Brad Rader, and Julie Newell (formerly known as Julie Rader), located at
1270 E. Badger Road, Lynden, Washington 98264 and the approximately 736 acres
of land in Whatcom County, Washington used in connection with the operation of
the Business (but specifically excluding the real property located at 8629
Benson Road, Lynden, WA 98264 and the real property located at 9046 Line Road,
Lynden, WA 98264, which are the personal residences of Lyle and Sue Rader and
Brad and Kari Rader, respectively, which parcels are not used in the operation
of the Business), including all easements, servitudes, licenses, rights of way,
permits, and the other appurtenances thereto, including appurtenant rights in
and to public streets, whether or not vacated.

“Permitted Encumbrances” means,
collectively, the following Special Exceptions contained in Schedule
B of the Preliminary Title Report:  1 through 32, inclusive; 34 through
106, inclusive; and 123; provided, however, that Permitted Encumbrances shall
not include any liens to be paid off at Closing, including but not limited to
currently existing liens in favor of Horizon Bank, John B. Romerman Jr. and
Jackie Romerman, Robert Nonhoff and Janet Nonhoff, and Mar-G Real Estate, LLC.

“Person” means an
individual, a partnership, a limited liability company, a corporation
(including any non-profit corporation), a cooperative, an association, a joint
stock company, a trust, a joint venture, an unincorporated organization and a
Governmental Authority, body or entity or any department, agency or political
subdivision thereof.

“Personal Property Leases”
means the Leases under which the Company is lessee of, or holds or operates,
any personal property owned by any other party.

“Proprietary Rights”
means all of the Company’s proprietary rights in and to intellectual property
used by the Company in connection with the Business including, without
limitation, all patents, patent applications, patent licenses, trademarks, trade
names (whether or not registered) and registrations and applications therefore,
domain names, trade secrets, technology, technical information, know-how,
formulae, designs and drawings, computer software, slogans, copyrights,
processes and other similar intangible property and rights, including all
income, royalties, damages, equitable relief and payments due or payable prior
to or at the Closing or thereafter (including damages, equitable relief and
payments for past, present or future infringements or misappropriations
thereof, the right to sue and recover for past infringements or
misappropriations thereof and any and all corresponding rights that, now or
hereafter, may be secured throughout the world).  With respect to all trademarks, service
marks, 

 5
 

industrial
designs, trade dress, internet domain names and web sites, logos, topographies,
trade names, brand names and corporate names, Proprietary Rights shall include
all goodwill associated therewith.  With
respect to all trade secrets, Proprietary Rights shall include all ideas,
formulae, plates, compositions, know-how, manufacturing and production
processes and techniques, research and development information, drawings,
specifications, designs, plans, proposals, technical data, financial, business
and marketing plans, and customer and supplier lists and related information
(including pricing and margins therefor).

“Real Estate Encumbrances”
means any restrictions on use of the Owned Real Property that would prevent or
hinder the use of such Owned Real Property in a manner consistent with the
current use of the particular parcel of Owned Real Property by the Business.

“Real Property Lease”
means the Company’s Lease, as lessee, of real property used in connection with
the Business which real property is not owned by the Company, Company
Shareholders, or Affiliates thereof, as listed on Schedule 4.7(b).  The sole Real Property Lease of the Company
is the Farmland Lease Agreement dated November 14, 2006, between the Company,
as lessee, and Harriet A. Nielsen-Howlett, as lessor.

“Release” shall have
the meaning set forth in CERCLA, except that it shall be deemed to include
without limitation the release of any Hazardous Substance as defined herein.

“Subsidiary” means
with respect to any Person, any corporation, partnership, limited liability
company, association or other business entity of which (i) if a
corporation, a majority of the total voting power of shares of stock entitled
(without regard to the occurrence of any contingency) to vote in the election
of directors, managers or trustees thereof is at the time owned or controlled,
directly or indirectly, by that Person or one or more of the other Subsidiaries
of that Person or a combination thereof, or (ii) if a partnership, limited
liability company, association or other business entity, a majority of the
partnership or other similar ownership interest thereof is at the time owned or
controlled, directly or indirectly, by any Person or one or more Subsidiaries
of that Person or a combination thereof. 
For purposes hereof, a Person or Persons shall be deemed to have a
majority ownership interest in a partnership, limited liability company,
association or other business entity if such Person or Persons shall be
allocated a majority of partnership, limited liability company, association or
other business entity gains or losses or shall be or control the managing
director or general partner of such partnership, limited liability company,
association or other business entity.

“Tax” or “Taxes”
means any federal, state, local or foreign income, gross receipts, capital
gains, franchise, alternative or add-on minimum, estimated, sales, use,
goods and services, transfer, registration, value added, excise, natural
resources, severance, stamp, occupation, premium, windfall profit,
environmental, customs, duties, real property, personal property, capital
stock, social security, unemployment, employment, disability, payroll, license,
employee or other withholding, contribution or other tax, of any kind
whatsoever, including any interest, penalties or additions to tax or additional
amounts in respect of the foregoing.

“Tax Returns” means
returns, declarations, reports, claims for refund, information returns or other
documents (including any related or supporting schedules, statements or
information) filed or required to be filed in connection with the
determination, assessment or 

 6
 

collection
of Taxes of any party or the administration of any laws, regulations or
administrative requirements relating to any Taxes.

“Transaction Documents”
means this Agreement, the Ground Lease, the Employment Agreement, and any and
all ancillary documents necessary to consummate the transaction contemplated
hereby.

“Working Capital”
means the sum of (i) Accounts Receivable (less a reasonable allowance for
bad debt) plus (ii) Inventory plus (iii) Deposits and
Prepaid Expenses, (the sum of (i), (ii) and (iii) constitute the “Current
Assets”), minus the sum of (i) Accounts Payable plus
(ii) accrued expenses as would be required to be shown on the Company’s
balance sheet.  To the extent any
of the prorations described in Section 2.6 are not adjusted for in
the Purchase Price on the Closing Date, such prorations shall be reconciled in
the Final Working Capital Amount determined in accordance with Section 2.7.

1.2   Other
Definitions.  Each of the following
defined terms has the meaning given such term in the Section set forth
opposite such defined term:

	
  Defined Term

  	
   

  	
  Section Reference

  
	
  Agreement

  	
   

  	
  Preamble

  
	
  Allocation

  	
   

  	
  Section 7.1(b)

  
	
  Applicable
  Limitation Date

  	
   

  	
  Section 6.1(a)

  
	
  Arbitrating
  Accountants

  	
   

  	
  Section 2.7(c)

  
	
  Assumed
  Liabilities

  	
   

  	
  Section 2.2(a)

  
	
  Business

  	
   

  	
  Recitals

  
	
  Buyer

  	
   

  	
  Preamble

  
	
  Buyer Parties

  	
   

  	
  Section 6.2(a)

  
	
  Cap

  	
   

  	
  Section 6.2(c)(ii)

  
	
  Claim

  	
   

  	
  Section 6.2(d)

  
	
  Closing

  	
   

  	
  Section 2.3(a)

  
	
  Closing Date

  	
   

  	
  Section 2.3(a)

  
	
  Closing
  Transactions

  	
   

  	
  Section 2.3(c)

  
	
  Company

  	
   

  	
  Preamble

  
	
  Company
  Shareholders

  	
   

  	
  Preamble

  
	
  Company Parties

  	
   

  	
  Section 6.2(b)

  
	
  Competitive
  Business

  	
   

  	
  Section 7.6(a)

  
	
  Confidential
  Information

  	
   

  	
  Section 7.6(c)

  
	
  Controlled Group

  	
   

  	
  Section 4.17(d)

  
	
  Deductible

  	
   

  	
  Section 6.2(c)(ii)

  
	
  Distribution
  Contracts

  	
   

  	
  Section 4.11(a)(xii)

  
	
  Employees

  	
   

  	
  Section 7.7(a)

  
	
  Employment
  Agreement

  	
   

  	
  Section 2.3(c)(ii)

  
	
  Escrow Agent

  	
   

  	
  Section 2.10(a)

  
	
  Escrow Agreement

  	
   

  	
  Section 2.10(a)

  
	
  Escrow Amount

  	
   

  	
  Section 2.10(a)

  
	
  Escrow Claim

  	
   

  	
  Section 2.10(b)

  
	
  Escrow
  Termination Date

  	
   

  	
  Section 2.10(a)

  

 

 7
 

                                                                                                

	
  Estimated Working Capital
  Statement

  	
   

  	
  Section 2.7(a)

  
	
  Excluded Assets

  	
   

  	
  Section 2.1(b)

  
	
  Final Working
  Capital Amount

  	
   

  	
  Section 2.7(b)

  
	
  Financial Statements

  	
   

  	
  Section 4.4(a)

  
	
  Governmental
  Authorizations

  	
   

  	
  Section 4.15

  
	
  Ground Lease

  	
   

  	
  Section 2.3(c)(i)

  
	
  Indemnified
  Party

  	
   

  	
  Section 6.2(d)

  
	
  Indemnifying
  Party

  	
   

  	
  Section 6.2(d)

  
	
  Insiders

  	
   

  	
  Section 4.19

  
	
  Interim
  Financial Statements

  	
   

  	
  Section 4.4(a)

  
	
  Loss

  	
   

  	
  Section 6.2(a)

  
	
  Non-Compete
  Period

  	
   

  	
  Section 7.6(a)

  
	
  Notice of Claim

  	
   

  	
  Section 6.2(d)

  
	
  Party and
  Parties

  	
   

  	
  Preamble

  
	
  Plans

  	
   

  	
  Section 4.17(a)

  
	
  Purchase Price

  	
   

  	
  Section 2.4

  
	
  Purchased Assets

  	
   

  	
  Section 2.1(a)

  
	
  Real Property

  	
   

  	
  Section 4.7(c)

  
	
  Restricted
  Parties

  	
   

  	
  Section 7.6(a)

  
	
  Retained
  Policies

  	
   

  	
  Section 7.8

  
	
  Transferred
  Employees

  	
   

  	
  Section 7.7(a)

  
	
  Restricted
  Territory

  	
   

  	
  Section 7.6(a)

  
	
  Unaudited Financial Materials

  	
   

  	
  Section 4.4(a)

  
	
  Unresolved
  Escrow Claims

  	
   

  	
  Section 2.10(c)

  
	
  Working Capital
  Adjustment

  	
   

  	
  Section 2.7(b)

  

 

ARTICLE
2

PURCHASE AND SALE OF ASSETS

2.1   Purchased Assets.

(a)   On
the terms and subject to the conditions contained in this Agreement, on the
Closing Date, Buyer shall purchase from the Company, and the Company shall
sell, convey, assign, transfer and deliver to Buyer, free and clear of all
Liens (except for Permitted Encumbrances), all rights, titles and interests of
every kind and nature in and to all of the following assets, but excluding all
Excluded Assets (the “Purchased Assets”):

(i)            all Accounts Receivable;

(ii)           all Deposits and Prepaid Expenses;

(iii)          all Buildings, Improvements and Fixtures;

(iv)          all Real Property Leases;

(v)           all Personal Property Leases;

(vi)          all Inventory;

 8
 

(vii)         all Equipment;

(viii)        all right, title and interest of the
Company in and to the Contracts listed on Schedule 4.7(b) and Schedule 4.11(a)
and all of the contract rights, claims, causes of action, refunds, credits,
rights of recovery and set-off, security interests, licenses, permits,
consents, authorizations, approvals, qualifications and registrations related
to such Contracts and accruing or otherwise coming due subsequent to the
Closing Date;

(ix)           all rights, whether arising under Contract or otherwise in
connection with the Business, with respect to the customers set forth on the
Customer List, including all related customer records and marketing, franchise
and distribution rights (including, without limitation, all rights under any
franchise and/or distribution agreements);

(x)            all rights to hire or engage the Transferred Employees
listed on Schedule 7.7(a) (Employee and Employee
Benefit Matters), and any confidentiality, work product,
non-competition and/or non-solicitation agreements entered into with such
employees and independent contractors, or, to the extent applicable to the
Business, with former employees and independent contractors used in the
operation of the Business;

(xi)           all of the Company’s business records and files including,
without limitation, sales information, advertising and marketing materials,
supplier records, cost and pricing information, production data, employment and
personnel records, accounting and credit records, correspondence, and other
records (including those maintained in computer tapes, disks, or other computer
retrievable format, and whether maintained by the Company or others); provided,
however, that (A) the Company may retain its tax returns and related work
papers and any other records or documents required by applicable law to be
retained by the Company (the Company shall deliver to Buyer complete and
accurate copies of all such writings), and (B) Buyer shall
(1) provide the Company and the Company Shareholders access to such
records transferred to Buyer as may be reasonably required from time to time (a) to prepare their income tax returns for their
current taxable year, (b) to
respond to any audit by any taxing authority related to any tax returns of the
Company or such Company Shareholder, or (c) for
other reasonable purposes related to pre-Closing matters, and (2) retain
such records for at least six (6) years after the Company and the Company
Shareholders file their federal income tax returns for their current taxable
year (the Company and each Company Shareholder will notify Buyer in writing of
the date of such filing as soon as practicable thereafter) or, at Buyer’s
option, make such records available to the Company and the Company
Shareholders;

(xii)          all claims, deposits, prepayments, warranties, guarantees,
refunds, causes of action, rights of recovery, rights of set-off and rights of
compensation of every kind and nature, to the extent relating to the Purchased
Assets or the Assumed Liabilities;

(xiii)         all Proprietary Rights and other
intangible rights and intangible property of the Company (including without
limitation the “Rader Farms” trademark,  the
raderfarms.com website, telephone, telecopy and e-mail addresses and listings);

 9
 

(xiv)        all Governmental Authorizations listed on Schedule 4.15
and all data and records pertaining thereto;

(xv)         all rights under or pursuant to all written warranties,
representations, guarantees and service contracts made by suppliers,
manufacturers and contractors in connection with the Purchased Assets;

(xvi)        all insurance, warranty, guarantee and condemnation proceeds
received on or after the Closing Date with respect to damage, non-conformance
of or loss to the Purchased Assets;

(xvii)       all brochures, artwork and other
promotional and printed materials, consumables, trade show materials and
equipment (including displays), videos, advertising and/or marketing materials;
and

(xviii)      all goodwill as a going concern and
associated with the items listed above.

(b)   Excluded Assets.  All right, title, and interest of every kind
and nature in and to all of the other assets and properties owned or leased by
the Company (including indirect and other forms of beneficial ownership) as of
the Closing Date, whether tangible, intangible, personal or real and wherever
located and by whomever possessed are expressly excluded from the purchase and
sale contemplated hereby (the “Excluded Assets”) and, as such, are not
included in the Purchased Assets. 
Without limiting the generality of the foregoing, Excluded Assets shall
include:

(i)            the Owned Real Property; and

(ii)           other assets, if any, listed on Schedule 2.1(b)(ii).

2.2   Limited
Assumption of Liabilities.

(a)   Limited Assumed
Liabilities.  Subject to the
conditions specified in this Agreement, and in reliance upon the
representations, warranties and agreements set forth herein, from and after the
Closing Date, Buyer will not assume or in any way be responsible for any
Liabilities of the Company or any other Liabilities whatsoever related to the
ownership, operation or condition of the Business or the Purchased Assets at
any time prior to the Closing Date, except as specifically provided below.  From and after the Closing Date, Buyer
assumes and agrees to pay, defend, discharge and perform as and when due only
the following specific Liabilities of the Company that relate exclusively to the
Business (the “Assumed Liabilities”):

(i)            Liabilities to the extent arising after the Closing Date
pursuant to all Real Property Leases, Personal Property Leases and Contracts
which are set forth on Schedule 4.7(b) or Schedule 4.11(a),
excluding, except to the extent (but only to the extent) reflected in any
negative adjustment to the Purchase Price pursuant to Section 2.7,
any Liability relating to or arising out of such Contracts and Leases as a
result of (A) any transaction, status, event, condition, occurrence or
situation existing, occurring or arising on or prior to the Closing Date,
(B) any breach of such Contracts occurring on or prior to the Closing
Date, (C) any violation of law, breach of warranty, tort or infringement 

 10
 

occurring on or prior to the
Closing Date, or (D) any related charge, complaint, action, suit,
proceeding, hearing, investigation, claim or demand;

(ii)           Liabilities to the extent (but only to the extent)
reflected in any negative adjustment to the Purchase Price pursuant to Section 2.7;

(iii)          Short-term Liabilities constituting accounts payable and
accrued liabilities included on the Company’s balance sheet as of December 31,
2006, plus other accounts payable and accrued liabilities incurred in the
Ordinary Course of Business after December 31, 2006, through and including the
Closing Date, documented in writing prior to Closing and reflected as non-debt
current liabilities in Working Capital under Section 2.7.

(b)   Excluded Liabilities.  Notwithstanding anything to the contrary
contained in this Agreement and regardless of whether such Liability is
disclosed herein or on any schedule hereto, Buyer will not assume or be liable
for any Excluded Liabilities.

2.3   Closing;
Conditions to Closing; Closing Transactions.

(a)   Closing.  The closing of the transactions contemplated
by this Agreement (the “Closing”) shall take place at the offices of
Chicago Title Insurance Company, 1616 Cornwall Avenue, Suite 115, Bellingham,
Washington 98225, at 10:00 a.m. local time on May 16, 2007 or at such other
place or time and on such other date as may be mutually agreeable to the
Parties.  The date and time of the
Closing are herein referred to as the “Closing Date.”  The Parties may attend the Closing
personally, via facsimile, or via telephone conference.

(b)   Conditions to Closing.  The Closing shall be subject to the
satisfaction of the following conditions:

(i)            At Buyer’s sole cost and expense, Chicago Title
Insurance Company shall be prepared to issue its standard leasehold policy of
title insurance in the amount of $20,700,000.00 insuring good and clear title
in fee ownership of the buildings and fixtures and in the leasehold estate
created by the Ground Lease in favor of Buyer, subject only to those matters
listed on Schedule 2.3(b)(i) attached hereto and the usual
exceptions in such form of policy.

(ii)           The lessor under the Real Property
Lease shall have consented to the assignment of the Real Property Lease to
Buyer.

(iii)          Buyer, the Company, and the Company Shareholders shall have
performed all other acts required hereunder to Close.

(c)   Closing Transactions.  The Parties shall consummate the following “Closing
Transactions” on the Closing Date:

(i)            Lyle and Sue Rader, Brad Rader and Julie Newell (formerly
known as Julie Rader) (the “Leasing Parties”) shall enter into a ground
lease agreement substantially in the form of Exhibit A (the “Ground
Lease”) pursuant to which Buyer, or 

 11
 

an Affiliate of Buyer
acceptable to Company Shareholders will lease all of the Owned Real Property
for a term of twenty (20) years from the Leasing Parties;

(ii)           Buyer and Brad Rader shall enter into an employment
agreement substantially in the form of Exhibit B (the “Employment
Agreement”).

2.4   Purchase
Price.  In consideration for the
Purchased Assets, Buyer will pay to the Company an amount equal to $20,700,000.00, subject to
adjustment in accordance with Section 2.7 and Article 6,
plus the Assumed Liabilities (the “Purchase Price”), payable as
follows:

(a)   an amount equal to the
Assumed Liabilities, payable by Buyer’s assumption of the Assumed Liabilities
on the Closing Date; and

(b)   an amount equal to $20,700,000.00 less the Escrow Amount, and subject to
adjustment as set forth in Section 2.7 and Article 6,
payable by wire transfer of immediately available funds on the Closing Date.

2.5   Transfer of Title.  At the Closing, title to all of the Purchased
Assets and risk of loss shall pass to Buyer. 
The Company shall convey all of the Purchased Assets to Buyer and shall
deliver to Buyer such appropriately executed instruments of sale, transfer,
assignment, conveyance and delivery, warranty, assignments of leases,
assignments, vehicle titles, transfer tax declarations and all other
instruments of conveyance which are necessary or desirable to effect transfer
to Buyer of good and marketable title to the Purchased Assets (free and clear
of all Liens other than Permitted Encumbrances), in each case in form and
substance satisfactory to Buyer and its counsel.  From and after Closing, the Company and each
of the Company Shareholders shall cooperate with Buyer and execute, deliver and
record such instruments of title and other documents reasonably requested by
Buyer in order to more fully perfect Buyer’s right, title and interest thereto
and therein.

2.6   Prorations
and Closing Costs.  Buyer, the
Company and each of the Company Shareholders hereby agrees that rents,
utilities and other payments or obligations under the Leases listed on Schedule 4.7(b)
and Schedule 4.11(a) and the Contracts listed on Schedule 4.11(a),
and all personal property taxes and assessments shall be prorated as of the
Closing Date and the Purchase Price shall be adjusted to reflect such
proration.  Buyer shall pay the cost of
any policy of title insurance; escrow fees, recording fees and other closing
costs shall be split equally between Buyer and the Company.

2.7   Purchase Price Adjustment.

(a)         Estimated Working Capital Statement.  Set forth at Exhibit C is the
Company’s estimated statement of the Working Capital of the Company as of the
Closing Date (the “Estimated Working Capital Statement”).  Such statement was prepared in accordance
with GAAP, consistently applied.

(b)         Final Working Capital Amount; Working Capital Adjustment.  No later than one hundred twenty (120) days
following the Closing Date, Buyer will review the Estimated Working Capital
Statement and provide the Company with its calculation

 12
 

of any adjustments to such
statement so as to confirm the actual Working Capital of the Company as of the
Closing (the “Final Working Capital Amount”), with such adjustments and
calculations to be prepared in accordance with GAAP, consistently applied.  To the extent that the Final Working Capital
Amount as finally determined pursuant to this Section 2.7 is
between $4,100,000.00 and $5,500,000.00, there shall be no adjustment to the Purchase Price.  To the extent that the Final Working Capital
Amount as finally determined pursuant to this Section 2.7 exceeds $5,500,000.00, the Purchase Price shall be adjusted upward
dollar for dollar to the extent of the difference.  To the extent that the Final Working Capital
Amount as finally determined pursuant to this Section 2.7 is lower
than $4,100,000.00, the Purchase Price shall be adjusted
downward dollar for dollar to the extent of the difference.  The amount of such increase or decrease, if
any, shall be the “Working Capital Adjustment” and shall be treated as
an adjustment to the Purchase Price.

(c)         Review of Working Capital Adjustment.  The Company shall have thirty (30) days from
the date of delivery to the Company by Buyer of its statement of the Final
Working Capital Amount to review Buyer’s calculation of the Final Working
Capital Amount.  Such calculation of the
Final Working Capital Amount and the Working Capital Adjustment shall be final
and binding upon Buyer, the Company and the Company Shareholders unless the
Company shall dispute the same in writing within such thirty (30)-day
period.  The Company may dispute Buyer’s
calculation of the Final Working Capital Amount and the Working Capital
Adjustment by specifying in reasonable detail the nature of the disagreement,
the basis for such disagreement and the Company’s calculation of the Final
Working Capital Amount and the Working Capital Adjustment.  In the event the Company so notifies Buyer in
writing within such thirty (30)-day period of any such dispute, Buyer and the
Company shall attempt to resolve all such disputes in writing, and the Working
Capital Adjustment shall be adjusted to reflect any such resolution (it being
understood that Buyer and the Company shall negotiate in good faith during a
period of at least ninety (90) days from the date of such notice by Company to
resolve such dispute).  If Buyer and the
Company are unable to resolve all such disputes within ninety (90) days after
the Company’s notification, then the matters still in dispute shall be
submitted to a nationally recognized accounting firm mutually acceptable to
Buyer and the Company, and if Buyer and the Company are unable to agree on the
choice of an accounting firm, then the accounting firm will be a nationally
recognized accounting firm independent with respect to both Buyer and the
Company selected by lot from a list of such firms compiled by the Company and
the auditors of Buyer (the “Arbitrating Accountants”).  Buyer and the Company shall be afforded the
opportunity to present to the Arbitrating Accountants (with copies to be
provided to the other party) any material related to the unresolved disputes
and to discuss the issues with the Arbitrating Accountants.  The Arbitrating Accountants shall determine
the amount of each of the items being disputed and notify the parties in
writing within thirty (30) days after the submission of the unresolved disputes
to the Arbitrating Accountants.  The
Arbitrating Accountants shall resolve all remaining points of disagreement with
respect to the Working Capital Adjustment, which resolution shall be final and
binding upon Buyer, the Company and the Company Shareholders, with no right of
appeal, and the Working Capital Adjustment shall be adjusted to reflect any
such resolution; provided, however, that the Arbitrating Accountants may only
consider those matters identified by 

 13
 

Buyer and the Company to be
in dispute and may only determine the Working Capital Adjustment to be an
amount equal to the amount proposed by Buyer, the amount proposed by the
Company or some amount within the range of the amounts proposed by Buyer and
the Company.  All fees of the Arbitrating
Accountants shall be paid by the party that proposed the Working Capital
Adjustment furthest from the Working Capital Adjustment determined by the
Arbitrating Accountants.  If the Company
is obligated to pay any such fees, such fees shall be paid as a further
adjustment to the Working Capital Adjustment. 
Following the delivery of Buyer’s calculation of the Final Working
Capital Amount and continuing during any period of dispute, the Company
Shareholders, the Company and its agents and advisors shall have full access to
the working papers and books and records of Buyer and the Company, and their
respective representatives relating to the Working Capital Adjustment.

(d)         To the extent that the Working Capital Adjustment, as
finally determined in accordance with this Section 2.7, represents
an upward adjustment of the Purchase Price, Buyer shall pay to the Company the
amount of such Working Capital Adjustment by wire transfer of immediately
available funds within five (5) Business Days following such determination.

(e)         To the extent that the Working Capital Adjustment, as
finally determined in accordance with this Section 2.7, represents
a downward adjustment of the Purchase Price, the amount of such downward
adjustment shall be deemed an undisputed Escrow Claim, such amount shall not be
payable to the Company and Buyer and the Company shall execute joint written
instructions to the Escrow Agent for the release of such amount from the Escrow
to Buyer.

2.8   Nonassignable Contracts.  The Company shall use reasonable efforts to
obtain all consents and approvals necessary to assign to Buyer any Contract
that is included in the Purchased Assets. 
To the extent that the assignment by the Company to Buyer of any
Contract is not permitted or is not permitted without the consent of any other
party to the Contract, this Agreement shall not be deemed to constitute an
assignment of any such Contract if such consent is not given or if such
assignment otherwise would constitute a breach of, or cause a loss of
contractual benefits under, any such Contract, and Buyer shall assume no
Liabilities thereunder.  If any such
consent is not obtained or if such assignment is not permitted irrespective of
consent, the Company shall use commercially reasonable efforts, at the Company’s
expense, to (i) provide to Buyer, at the request of Buyer, the benefits of
any such Contract transferred herein, (ii) cooperate in any lawful arrangement
prescribed by Buyer to provide such benefits to Buyer and (iii) enforce,
to the extent enforceable by the Company, at the request of and for the account
of Buyer, any rights of the Company arising from any Purchased Asset referred
to herein against any third person (including a Governmental Authority)
including the right to elect to terminate a Contract in accordance with the
terms thereof upon the advice of Buyer.

2.9   Post-Closing
Amounts Received and Paid.  Except as
provided in Section 7.12, all cash collected on or after the
Closing Date from Accounts Receivable which constitute Purchased Assets shall
belong to Buyer, and if received by the Company, shall be received for the
benefit and the account of Buyer, and the Company shall, on a weekly basis,
transfer and remit to Buyer all such amounts received by or paid to the Company
on or after the 

 14
 

Closing Date.  All cash collected
on or after the Closing Date from accounts receivable which do not constitute
Purchased Assets shall belong to the Company, and if received by Buyer, shall
be received for the benefit and the account of the Company, and Buyer shall, on
a weekly basis, transfer and remit to the Company all such amounts received by
or paid to Buyer on or after the Closing Date.

2.10   Escrow.

(a)   Escrow of Part of the
Purchase Price.  At the Closing,
Buyer, the Company and the Company Shareholders shall enter into an escrow
agreement in the form of Exhibit H (the “Escrow Agreement”) with
an independent third party escrow agent (the “Escrow Agent”) acceptable
to Buyer in its sole discretion pursuant to which Buyer shall deposit
$1,000,000.00 of the Purchase
Price (the “Escrow Amount”) with the Escrow Agent to (i) cover any Working Capital Adjustment under Section 2.7(e) and (ii) secure the due performance and payment of the
indemnification obligations of the Company and the Company Shareholders for a
period of twelve (12) months following the Closing Date.  The Escrow Amount is subject to the covenants
(including all procedures) set forth in the provisions of this Section 2.10
and the Escrow Agreement.  Subject to the
provisions of Section 2.10(c) below, the Escrow Agreement shall
terminate upon the date that is twelve (12) months after the Closing Date (the “Escrow
Termination Date”).

(b)   Deductions
from the Escrow Amount.  In the event
that Buyer reasonably believes that indemnification by the Company or the
Company Shareholders is required under Article 6 after applying any
applicable limitations described in Article 6, Buyer shall deliver
written notice thereof to the Company and the Company Shareholders with copies
to Company’s counsel and the Escrow Agent, which notice shall contain a
statement reasonably describing the nature of the indemnification obligation,
the identity of the Person (including Buyer) by whom it is being asserted, and
the amount asserted as a Loss or Losses as a result thereof (the “Escrow
Claim”).  Buyer shall deliver to the
Company and the Company Shareholders copies of all material documentation
relating to each Escrow Claim, including (as applicable) any pleadings and
amended pleadings filed in connection with any such Escrow Claim and will
provide the Company Shareholders and the Company and its counsel with such
further information concerning the Escrow Claim as the Company Shareholders and
the Company and its counsel may reasonably request.  If the Company or the Company Shareholders
dispute any Escrow Claim or portion thereof, the Company and the Company
Shareholders shall, within thirty (30) days of receipt of such Escrow Claim,
deliver to Buyer and Escrow Agent a notice of objection (a “Dispute Notice”),
setting forth with reasonable particularity the grounds and the basis upon
which the Escrow Claim or any portion thereof is disputed.  If the Company and Company Shareholders do not provide Buyer and Escrow
Agent with a timely Dispute Notice, Buyer shall have the right to receive the
full amount of the Escrow Claim from the Escrow Amount and such amount shall
not be payable to the Company.  If the
Company and Company Shareholders provide Buyer and Escrow Agent with a timely
Dispute Notice and such Dispute Notice disputes only a portion of such Escrow
Claim, Buyer shall have the right to receive an amount equal to the
non-disputed portion of such Escrow Claim from the Escrow Amount and such
non-disputed portion of the Escrow Claim shall not be payable to the
Company.  Whenever the Company provides
Buyer with a timely Dispute Notice, the Parties shall thereafter negotiate in
good faith to attempt to resolve such dispute. 
If the Parties are not able to resolve such dispute within thirty (30) 

 15
 

days
of the receipt by Buyer of the Dispute Notice, then the Company, the Company
Shareholders and Buyer shall each have the right to take such legal steps as
any of them deem necessary with respect to such dispute.

(c)   Escrow Termination.  On the Escrow Termination Date, Buyer shall
promptly, and in any event no later than three (3) Business Days after the
Escrow Termination Date, instruct the Escrow Agent to pay over to the Company
the remaining amount of the Escrow Amount, less any Unresolved Escrow
Claims.  The Escrow Agreement shall not
be terminated with respect to timely noticed Escrow Claims by Buyer, if any,
which remain unresolved at the Escrow Termination Date (“Unresolved Escrow
Claims”).  In the event that any
Unresolved Escrow Claims remain disputed on and after the Escrow Termination
Date, the Escrow Agent shall retain the disputed amount of the Unresolved
Escrow Claim until such Unresolved Escrow Claim is either (i) resolved by
Buyer, the Company and the Company Shareholders and joint written instructions
are delivered to the Escrow Agent, or (ii) there is an order of a court of
competent jurisdiction that the amount of the Unresolved Escrow Claim (and any
other amount) shall be paid by from the Escrow Amount to the Company, the
Company Shareholders or Buyer.  At the
time of the final settlement or determination of any Unresolved Escrow Claim
(or any reduction in the amount asserted as Loss), the Escrow Agent shall pay to
Buyer from the Escrow Amount Buyer’s portion of the Escrow Amount applicable to
such Unresolved Escrow Claim in accordance with said final settlement or
determination and pay over to the Company or the Company Shareholders, as the
case may be, the balance of the Escrow Amount until the Escrow Amount is
exhausted.

ARTICLE
3

DELIVERABLES

3.1   Company
Deliverables.  On or before the
Closing Date, the Company shall deliver the following items to Buyer, each of
which shall be to Buyer’s satisfaction in its commercially reasonable
discretion:

(a)   Subject to the terms of Section 2.8,
all consents and approvals by third parties that are required for the transfer
of the Purchased Assets, that are required for the assignment and transfer of
the Distribution Contracts, and other Contracts included in the Purchased
Assets, that are required for the assignment of the Real Property Lease, that
are required for the consummation of the transactions contemplated hereby or
that are required in order to prevent a breach of or a default under or a
termination or modification of or any right of acceleration of any Liability
under any Contract which is included as one of the Purchased Assets, in each
case on terms and conditions satisfactory to Buyer;

(b)   All governmental and regulatory
filings, authorizations and approvals and other Governmental Authorizations
that are required for the transfer of the Purchased Assets to Buyer and the
consummation of the transactions contemplated hereby shall have been duly made
and obtained on terms reasonably satisfactory to Buyer;

(c)   Releases of any and all
Liens with respect to the Purchased Assets (except for Permitted Encumbrances);

 16
 

(d)   The Ground Lease, duly
executed by the Leasing Parties;

(e)   An original of an Assignment
and Assumption Agreement in substantially the form of Exhibit D,
assigning the Real Property Lease to Buyer, executed by the Company;

(f)    An original of a Bill of
Sale in substantially the form of Exhibit E, transferring all of
the Company’s right, title and interest in the Purchased Assets to Buyer,
executed by the Company;

(g)   The Employment Agreement,
duly executed by Brad Rader;

(h)   An opinion, dated the
Closing Date, of counsel to the Company, in the form of Exhibit F;

(i)    The Escrow Agreement, duly
executed by the Company and the Company Shareholders;

(j)    A certificate duly executed
by the Secretary of the Company certifying as to (i) the Company’s
certificate of incorporation and bylaws of the Company, (ii) resolutions
of the Company’s board of directors and, to the extent required, of the Company’s
shareholders, authorizing the execution, delivery and performance of this
Agreement, and approving the consummation of the transactions contemplated
hereby and (iii) the incumbency of the officers of the Company executing
this Agreement;

(k)   Certificates of good
standing for the Company dated within ten (10) days prior to the Closing Date
issued by the Secretary of State of the State of Washington  and each jurisdiction where the Company is
qualified to do business (including the jurisdictions listed on Schedule 4.1);
and

(l)    Such other documents or
instruments as Buyer may reasonably request to effect the transactions
contemplated hereby.

3.2   Buyer’s
Deliverables.  On or before the
Closing Date, Buyer shall deliver the following items to the Company, each of
which shall be to the Company’s satisfaction in its sole discretion:

(a)   The Ground Lease, duly
executed by Buyer;

(b)   An original of an Assignment
and Assumption Agreement in substantially the form of Exhibit D,
assigning the Real Property Lease to Buyer, executed by the Company;

(c)   The Employment Agreement,
duly executed by Buyer;

(d)   A certificate duly executed
by the Secretary of Buyer certifying as to (i) Buyer’s certificate of
incorporation and bylaws, (ii) resolutions of Buyer’s board of directors
authorizing the execution, delivery and performance of this Agreement and the
other Transaction Documents, and approving the consummation of the transactions
contemplated hereby and thereby and (iii) the incumbency of the officers of
Buyer executing this Agreement;

 17
 

(e)   An opinion, dated the
Closing Date, of counsel to Buyer, in the form of Exhibit G;

(f)    The Escrow Agreement, duly
executed by Buyer; and

(g)   Such other documents or
instruments as the Company may reasonably request to effect the transactions
contemplated hereby.

ARTICLE
4

REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND COMPANY SHAREHOLDERS

As a material inducement to
Buyer to enter into this Agreement, the Company and each Company Shareholder
hereby represents and warrants, jointly and severally, to Buyer as follows:

4.1   Organization
and Corporate Power.

(a)   The
Company is a corporation duly organized and validly existing and in good
standing under the laws of the State of Washington and is qualified to do business
in the State of Washington and in no other jurisdiction.

(b)   The
Company does not own, directly or indirectly, any equity or other ownership
interest in any corporation, partnership, joint venture, or other entity or
enterprise.  The Company is not obligated
to make any future investment in or capital contribution to any corporation,
partnership, joint venture or other entity or enterprise, and the Company has
not guaranteed and is not liable for any obligation of any such Person.

(c)   The
Company has full corporate power and authority and all Governmental
Authorizations necessary to own and operate the Purchased Assets and to carry
on the Business as currently conducted and as presently proposed to be
conducted.

(d)   The
copies of the articles of incorporation and bylaws of the Company that have
been furnished to Buyer reflect all amendments thereto and are correct and
complete.

4.2   Authorization
of Transactions.  The Company has
full corporate power and authority to execute and deliver this Agreement and to
consummate the transactions contemplated hereby.  The board of directors and the shareholders
of the Company have duly approved this Agreement and have duly authorized the
execution and delivery of this Agreement and all ancillary documents and the
consummation of the transactions contemplated hereby.  No other corporate proceedings on the part of
the Company are necessary to approve and authorize the execution and delivery
of this Agreement or any of the ancillary documents and the consummation of the
transactions contemplated hereby.  As of
Closing, this Agreement and all other Transaction Documents to which any of the
Company or the Company Shareholders is a party have been duly executed and
delivered by the Company and any such Company Shareholder, as applicable, and
constitute the valid and binding agreements of the Company and each Company
Shareholder, as applicable, enforceable against the Company and each Company
Shareholder, as applicable, in accordance with their terms.

 18
 

4.3   Absence
of Conflicts.  Except as set forth in
Schedule 4.3, the execution, delivery and performance of this
Agreement and the other Transaction Documents and the consummation of the
transactions contemplated hereby and thereby by the Company and the Company
Shareholders do not and shall not (a) conflict with or result in any
breach of any of the terms, conditions or provisions of, (b) constitute a
default under, (c) result in a violation of, (d) give any third party
the right to modify, terminate or accelerate any obligation under,
(e) result in the creation of any Lien upon the Purchased Assets, or
(f) require any authorization, consent, approval, exemption or other
action by or notice or declaration to, or filing with, any court or
administrative or other Governmental Authority, under the provisions of the
articles of incorporation or bylaws of the Company or any Contract to which the
Purchased Assets are bound or affected, or any law, statute, rule or regulation
to which the Company or any of the Purchased Assets is subject or any judgment,
order or decree to which the Company is subject.

4.4   Financial
Statements.

(a)   Attached
as Schedule 4.4 are (i) the Company’s unaudited balance sheet and
the related unaudited statements of income and cash flows for the twelve (12)
months ending December 31, 2006, (ii) the Company’s audited balance
sheet and unaudited statement of income and cash flows for the twelve (12)
months ending December 31, 2005 ((i) and (ii) collectively, the “Financial
Statements”), and (iii) the Company’s unaudited balance sheet and the
related unaudited statements of income and cash flows for the three (3) months
ending March 31, 2007 (the “Interim Financial Statements” and,
together with the unaudited statement of income and cash flows for the twelve
(12) months ending December 31, 2005, the “Unaudited Financial Materials”).  The Company has not undergone any independent
audit or review of its Interim Financial Statements.  The Financial Statements and the Interim
Financial Statements have been prepared in accordance with GAAP, consistently
applied, and fairly present in all material respects the financial condition
and the results of operations, changes in shareholders’ equity, and cash flows
of the Company as of the respective dates of and for the periods referred to
therein, except that the Unaudited Financial Materials do not include schedules
and footnotes required under GAAP, or normal year-end adjustments.

(b)   The Company has not
identified any significant deficiencies or material weaknesses in the design or
operation of its internal control over financial reporting which are reasonably
likely to adversely affect the Company’s ability to record, process, summarize
and report financial information, and, with respect to the Company and to the
Company’s Knowledge, there has been no fraud, whether or not material, that
involves management or other employees who have a significant role in its
internal control over financial reporting. 
The Company has not received prior to the Closing Date any written
complaint, allegation, assertion or claim regarding any significant
deficiencies or material weaknesses in the design or operation of its internal
accounting controls.

(c)   On Monday, May 21,
2007 by 5:00 P.M. Mountain Standard Time, the Company shall provide to Buyer
unqualified audited financial balance sheet and related audited statement of
income and cash flows for the twelve (12) months ending December 21, 2006, the
content of which does not materially differ from the unaudited financial
balance sheet and related unaudited statement of income and cash flows for the
twelve (12) months ending December 21, 2006 provided on Schedule 4.4.  On or before June 29, 2007, the Company shall
provide to 

 19
 

Buyer a draft form of audited statement of income and cash flows for
the twelve (12) months ending December 31, 2005.  On or before July 13, 2007, the Company shall
provide to Buyer the final audited statement of income and cash flows for the
twelve (12) months ending December 31, 2005.

4.5   Absence
of Undisclosed Liabilities.  Except for liabilities (a) reflected or
reserved against in the balance sheet of the Company as at December 31, 2006,
(b) incurred in the Ordinary Course of Business since December 31, 2006
(none of which resulted from, arose out of, is related to, or was caused by any
breach of contract, breach of warranty, tort, infringement or violation of
Law), (c) arising under Contracts to which the Company is a party, and/or
(d) described on the Schedule 4.5, the Company, to its
Knowledge, has no material obligations or liabilities (whether accrued,
absolute, contingent or otherwise) that are required to be reflected as
liabilities on a balance sheet prepared in accordance with GAAP consistently
applied.  The Company does not have any
liability which will become due as a result of the consummation by the Company
of the transactions contemplated by this Agreement.

4.6   Absence
of Certain Developments.  Except as
set forth in Schedule 4.6 or as expressly contemplated by this
Agreement, since December 31, 2006, the Company has not with respect to the
Business, except in the Ordinary Course of Business:

(a)   suffered a Material Adverse
Effect;

(b)   suffered any theft, damage,
destruction or casualty loss in excess of $10,000.00 to any of the Purchased Assets, whether or
not covered by insurance, or suffered any substantial destruction of the
Company’s books and records;

(c)   experienced any labor
dispute or threatened labor dispute involving any employees involved in the
Business;

(d)   borrowed any amount or
incurred or become subject to any Indebtedness or other Liabilities;

(e)   subjected any portion of the
Purchased Assets to any Lien;

(f)    sold, leased, assigned or
transferred (including transfers to any Insider) a portion of the Purchased
Assets (including Proprietary Rights), or canceled without fair consideration
any material debts or claims owing to or held by it, or disclosed any
confidential information (other than pursuant to agreements requiring the
disclosure to maintain the confidentiality of and preserving all rights of the
Company in such confidential information);

(g)   waived any rights of
Material value under any Material Contract;

(h)   entered into, amended or
terminated any material Contract;

(i)    entered into any other
material transaction, or materially changed any business practice;

 20

(j)    received written
notification that any material customer or supplier will stop or decrease in
any material respect the rate of Business done with the Company or experienced
an actual or threatened material dispute with any material customer or supplier;

(k)   instituted or settled any
claim or lawsuit involving equitable or injunctive relief of more than $10,000.00 in the aggregate;

(l)    granted any performance
guarantee to any of its customers;

(m)  offered any Material
discounts on any of its products or any promotions, rebates, coupons or special
offers with respect to any of its products with terms and conditions that
differ in any material respect from the terms and conditions previously offered
by the Company with respect to the Business;

(n)   changed any of the terms and
conditions with respect to the pricing of any of its products (including any
terms and conditions that are ancillary to, or otherwise affect, the aggregate
price paid for any of its products) that differ in any material respect from the
terms and conditions previously offered by the Company with respect to the
Business;

(o)   acquired any other business
or entity (or any significant portion or division thereof), whether by merger,
consolidation or reorganization or by purchase of assets or stock or acquired
any other material assets; or

(p)   committed or agreed to any
of the foregoing in any manner that would be legally enforceable.

4.7   Title
to Properties.

(a)   Schedule 4.7(a)
sets forth a list of each parcel of Owned Real Property.  True and complete copies of (i) all
deeds and existing title insurance policies of or pertaining to the Owned Real
Property and (ii) all instruments, agreements and other documents
evidencing, creating or constituting any Real Estate Encumbrances have been
delivered to Buyer.  With respect to each
such parcel of Owned Real Property: 
(A) the Company Shareholders and their children (Brad Rader and
Julie Newell, formerly known as Julie Rader) own, or will own immediately
following Closing, marketable title to such parcel, free and clear of all
Liens, except Permitted Encumbrances; (B) there are no leases, subleases,
licenses, concessions or other agreements, written or oral, granting to any
person the right of use or occupancy of any portion of such parcel; and
(C) there are no outstanding actions or rights of first refusal to
purchase such parcel, or any portion thereof or interest therein.

(b)   Schedule 4.7(b)
sets forth the address and/or tax parcel number of the property leased pursuant
to the Real Property Lease, and a true and complete list of all Real Property
Leases (including all amendments, extensions, renewals, guaranties and other
agreements with respect thereto) for each such leased real property.  Each of the Real Property Leases is in full
force and effect, and the Company holds a valid and existing leasehold or
subleasehold interest under each of the Real Property Leases.  The Company has delivered to Buyer true,
correct, complete and accurate copies of each of the Real Property Leases
listed on Schedule 4.7(b). 
With respect to each Real Property Lease listed on the Schedule 4.7(b):  (i) the Real Property 

 21
 

Lease
is legal, valid, binding, enforceable and in full force and effect;
(ii) the Real Property Lease will continue to be legal, valid, binding,
enforceable and in full force and effect on identical terms following the
Closing for the duration stated in such Real Property Lease, subject to the
terms thereof; (iii) to the Company’s Knowledge, no party to any Real
Property Lease has repudiated any provision thereof; (iv) to the Company’s
Knowledge, there are no disputes, oral agreements, or forbearance programs in
effect with respect to any Real Property Lease; (v) no Real Property Lease
has been modified in any respect, except to the extent that such modifications
are disclosed by the documents delivered to Buyer; and (vi) the Company
has not assigned, transferred, conveyed, mortgaged, deeded in trust or
encumbered any interest in any Real Property Lease.

(c)   The Owned Real Property and
Real Property Leases are referred to collectively herein as the “Real
Property”.

4.8   Condition of Facilities.  Except as noted on Schedule 4.8, use
of the Real Property for the various purposes for which it is presently being
used is permitted as of right under all applicable zoning legal requirements or
is a “permitted nonconforming” use of structure classifications that has
received all necessary Governmental Authorizations.  To the Knowledge of the Company, except as
noted on Schedule 4.8, all Buildings, Improvements and Fixtures are
in material compliance with all applicable legal requirements, including but
not limited to Environmental and Safety Regulations, including those pertaining
to zoning, building and the disabled, to the extent applicable, are in good
repair and in good condition, ordinary wear and tear excepted, and, to the
Knowledge of the Company, are free from latent and patent defects.  To the Knowledge of the Company, except as
noted on Schedule 4.8, no part of any Buildings, Improvements and
Fixtures encroaches on any real property not included in the Real Property, and
there are no buildings, structures, fixtures or other improvements primarily
situated on adjoining property which encroach on any part of the Real
Property.  To the Knowledge of the
Company, there is no existing or proposed plan to modify or realign any street
or highway or any existing or proposed eminent domain proceeding that would
result in the taking of all or any part of any facility or that would prevent
or hinder the continued use of any facility as heretofore used in the conduct
of the Business.

4.9   Title and Condition of
Assets.

(a)   Title; Sufficiency.  The Company has good, valid and marketable
title to all of the Purchased Assets, and at Closing, the Company will convey
good, valid and marketable title to each of the Purchased Assets to Buyer.  The title to each Purchased Asset is, and at
Closing will be, free and clear of all Liens, except for Permitted
Encumbrances.  The Purchased Assets
constitute all of the material assets and rights necessary for the conduct of
the Business as presently conducted.

(b)   Inventory.  Except as disclosed on Schedule 4.9(b),
the Inventory consists of a quality and quantity saleable in the Ordinary
Course of Business in accordance with normal industry practice.

(c)   Equipment.  Except with respect to any individual item
originally purchased by the Company for less than $25,000.00 and as otherwise disclosed on Schedule 4.9(c),
the 

 22
 

Equipment
is in good operating condition and repair (normal wear and tear excepted), has
been maintained in accordance with normal industry practice and is suitable for
the purposes for which it is presently used.

(d)   Accounts Receivable.  The Accounts Receivable represent valid
obligations arising from sales actually made or services actually performed by
the Company in the Ordinary Course of Business. 
The reserve against liability for uncollectible Accounts Receivable set
forth on the Estimated Working Capital Statement is reasonable based on past
practice.

4.10 Taxes.  Except as set forth on Schedule 4.10,
with regard to the Business and the Purchased Assets:

(a)   the
Company is and has always been a valid subchapter S corporation;

(b)   the
Company has timely filed or shall timely file all Tax Returns which are
required to be filed on or before the Closing Date, and all such Tax Returns
are true, complete and accurate;

(c)   all
Taxes due and payable by the Company, whether or not shown on a Tax Return,
have been paid or shall be paid by the Company and no Taxes are delinquent;

(d)   no
deficiency for any amount of Tax has been asserted or assessed by a taxing
authority against the Company and the Company does not reasonably expect that
any such assertion or assessment of Tax liability will be made;

(e)   the
Company has not consented to extend the time in which any Tax may be assessed
or collected by any taxing authority;

(f)    no
claim has ever been made by a taxing authority in a jurisdiction where the
Company does not file Tax Returns that the Company is or may be subject to
Taxes assessed by such jurisdiction;

(g)   the
Company has withheld and paid all Taxes required to have been withheld and paid
in connection with amounts paid or owing to any employee, independent
contractor, creditor, stockholder or other third party; and

(h)   the
Company will not be required (i) as a result of a change in method of
accounting for a taxable period ending on or prior to the Closing Date, to
include any adjustment in taxable income for any taxable period (or any portion
thereof) or (ii) as a result of any “closing agreement,” as described in
Section 7121 of the Code (or any corresponding provision of state, local
or foreign income Tax law), to include any item of income in, or exclude any
item of deduction from, taxable income for any taxable period (or portion
thereof) ending after the Closing Date.

Schedule 4.10
contains a list of states, territories and jurisdictions (whether foreign or
domestic) in which the Company is required to file Tax Returns relating to the
Business.  The Purchased Assets are free
and clear of any Lien related to any Tax Liability other than Permitted 

 23
 

Encumbrances
whatsoever or howsoever arising (whether accrued, absolute, contingent or
otherwise).

4.11     Contracts
and Commitments.

(a)   Except for the Purchased
Assets and other matters specifically contemplated by this Agreement, and
except as set forth in Schedule 4.11(a), with respect to the
Business, the Company is not a party to or bound by, and the Purchased Assets
are not bound by, whether written or oral, any:

(i)            collective bargaining agreement or Contract with any
labor union or any bonus, commissions, pension, profit sharing, retirement or
any other form of deferred compensation plan or any stock purchase, stock
option, hospitalization insurance or similar plan or practice, whether formal
or informal;

(ii)           Contract for the employment of any Transferred Employees
listed on Schedule 7.7(a) on a full-time or consulting basis
or any notice, severance or change-of-control agreements;

(iii)          Contract relating to Indebtedness or to mortgaging,
pledging or otherwise placing a Lien on any of the Purchased Assets;

(iv)          license or royalty Contract;

(v)           guaranty of any obligation, other than endorsements made
for collection;

(vi)          Contract with any customer listed on Schedule 1.1
or any supplier listed on Schedule 4.23;

(vii)         Contract under which it is lessee of, or holds or operates,
any personal property owned by any other party calling for payments in excess
of $10,000.00 annually or under
which it is lessor of or permits any third party to hold or operate any
property, real or personal, owned or controlled by it;

(viii)        Contract or group of related Contracts
with the same party for the purchase or sale of supplies, products or other
personal property or for the furnishing or receipt of services which either
calls for performance over a period of more than one year or involves a sum in
excess of $10,000.00;

(ix)           Contract with any Person for the purchase or supply of
vegetables or berries or any other ingredient or material used in a product of
the Business;

(x)            Contract for the co-packaging or similar arrangement for
any product of the Business;

(xi)           Contract which prohibits the Company from freely engaging
in the Business anywhere in the world;

 24
 

(xii)          Contract relating to the distribution (including with
respect to systems, routes or networks), marketing or sales of the Company’s
products (the “Distribution Contracts”);

(xiii)         Contract pursuant to which the Company
subcontracts work to third parties;

(xiv)        Contract relating to the acquisition or sale of the Business
(or any material portion thereof);

(xv)         Contract for warehouse management;

(xvi)        Contract for movement of freight;

(xvii)       “take-or-pay” or “requirements” Contract;

(xviii)      any other Contract not already listed
under one of the subsections above that involves future payments, performance
by the Company of services or delivery by the Company of goods or materials of
an aggregate amount or value in excess of $10,000.00 on an annual basis, or that otherwise is
material to the Business or prospects of the Business, taken as a whole; or

(xix)         any amendment, waiver or modification to any of the
foregoing.

(b)   Except as disclosed in Schedule 4.11(b)
or as would not reasonably be expected to result in a Material Adverse Effect,
(i) to the Company’s Knowledge, no Contract or commitment disclosed on, or
required to be disclosed on, Schedule 4.11(a) has been breached,
defaulted on, or canceled by the other party, and the Company has no Knowledge
of any anticipated breach, default or cancellation by any other party to any
Contract set forth or required to be set forth on Schedule 4.11(a),
(ii) the Company has performed all the obligations required to be
performed by it in connection with the Contracts disclosed on, and the
Contracts required to be disclosed on, Schedule 4.11(a) and is not
in default under or in breach of any such Contract, and no event has occurred
which with the passage of time or the giving of notice or both would result in
a default or breach thereunder, (iii) the Company does not have a present
expectation or intention of not fully performing any obligation pursuant to any
Contract set forth on, or any Contract that is required to be set forth on, Schedule 4.11(a),
and (iv) each Contract with respect to the Business is legal, valid,
binding, existing, enforceable and in full force and effect and will continue
as such following the consummation of the transactions contemplated hereby.

(c)   The Company has provided
Buyer with a true and correct copy of all written Contracts, or provided Buyer
with access to such Contracts, which are required to be disclosed on Schedule 4.11(a),
in each case together with all amendments, waivers or other changes thereto.

 25
 

4.12     Proprietary
Rights.

(a)   Schedule 4.12
lists the Proprietary Rights included in the Purchased Assets.  The Proprietary Rights used by the Company
with respect to the Business immediately prior to the Closing hereunder will be
owned or available for use on identical terms and conditions immediately
subsequent to the Closing hereunder.

(b)   Except as set forth on Schedule 4.12,
(i) the Company owns and possesses all right, title and interest in and
to, or has a valid and enforceable right to use, each of the Proprietary Rights
listed on Schedule 4.12, free and clear of all Liens, except
Permitted Encumbrances, and no claim by any third party contesting the
validity, enforceability, use or ownership of any of the Proprietary Rights has
been made, is currently outstanding or, to the Company’s Knowledge, is
threatened, (ii) the Company has not received any notices of, nor is the
Company aware of any facts which indicate a likelihood of, any infringement or
misappropriation by, or conflict with, any third party with respect to any
Proprietary Right owned by, issued to or licensed to the Company (including any
demand or request that the Company license rights from a third party),
(iii) the Company has not infringed, misappropriated or otherwise
conflicted with any rights of any third parties and the Company is not aware of
any infringement, misappropriation or conflict which shall occur as a result of
the continued operation of the Business as currently conducted, and
(iv) to the Company’s Knowledge, the Proprietary Rights owned or licensed
to the Company have not been infringed, misappropriated or conflicted by any
third party.

(c)   The transactions
contemplated by this Agreement shall have no material adverse effect on Buyer’s
right, title and interest in and to any of the Proprietary Rights included as
Purchased Assets.  The Company’s trade
secrets included in the Proprietary Rights are treated by the Company as
confidential information with respect to the Business.  Except as set forth in Schedule 4.12,
the Company has entered into written confidentiality agreements and written
proprietary rights agreements with all of its employees and independent
contractors with access to trade secrets included in the Purchased Assets or
involved in creating or developing inventions relating to the Business within
the scope of their employment and, to the Company’s Knowledge, no such
agreements have been breached by such employee or independent contractor.  The Company has taken reasonable actions to
maintain and protect its Proprietary Rights.

4.13     Litigation;
Proceedings.  Except as set forth in Schedule 4.13,
there are no claims, disputes, actions, suits, proceedings, orders, writs,
injunctions, judgments, decrees or investigations pending or, to the Company’s
Knowledge, threatened against or affecting the Company with respect to the
Business or the Purchased Assets at law or in equity, or before or by any
federal, state, municipal or other governmental department, commission, board,
bureau, agency or instrumentality, domestic or foreign, and to the Company’s
Knowledge there is no basis known for any of the foregoing.  Except as set forth on Schedule 4.13,
the Company has not received any opinion or legal advice in writing to the
effect that the Company is exposed from a legal standpoint to any liability or
disadvantage which may be material to the Business as previously, presently or
as proposed to be conducted or the business prospects of the Business.  Neither the Company with respect to the
Business nor any of the Purchased Assets is subject to any outstanding order,
judgment or decree issued by any court or quasi-judicial or
administrative agency of any federal, state, local or foreign jurisdiction or
any arbitrator.  Except as set forth in

 26
 

Schedule 4.13, the Company is fully
insured with respect to each of the matters set forth on Schedule 4.13.  The Company Shareholders agree to continue to
diligently pursue a resolution to the matter set forth on Schedule 4.13,
including continuing their efforts to seek approval to use the parcel that is
the subject of such matter for agricultural purposes from all applicable
Governmental Authorities; the Company Shareholders shall continue to pay the
legal fees relating to such matter and shall pay all fees and expenses
(including attorneys’ fees) incurred in the event such matter becomes subject
to litigation.  The Company Shareholders
shall keep Buyer apprised of the status of the matter set forth on Schedule
4.13, and shall not settle such matter without the prior written consent of
Buyer, which consent shall not be unreasonably withheld or delayed.  The Company Shareholders agree to be liable
for any loss, claim or damage relating to actions taken prior to Closing on the
parcel that is the subject of the matter described on Schedule 4.13.

4.14     Brokerage.  Except as set forth in Schedule 4.14,
there are no claims for brokerage commissions, finders’ fees or similar
compensation in connection with the transactions contemplated by this Agreement
based on any Contract made by or on behalf of the Company.

4.15     Governmental
Authorizations and Permits.  Schedule 4.15
contains a list of all written permits, licenses, variances, franchises,
orders, approvals, waivers, consents, certificates, registrations and other
authorizations of foreign, federal, provincial, state and local governments,
governmental agencies, judicial authority or regulatory body or other similar
rights owned,  possessed, necessary, or
used by the Company in the conduct of the Business that have been issued in
writing to the Company or Company Shareholders (collectively, the “Governmental
Authorizations”).  Except as set
forth on Schedule 4.15, no Governmental Authorizations are required
to operate the Business as currently conducted.

4.16     Employees.

(a)   Except
as set forth on Schedule 4.16(a),

(i)            to the Company’s Knowledge, no Transferred
Employee has any plans to terminate his, her or its employment or relationship
as an independent contractor with the Company. 
The Company has complied with all applicable laws relating to the
employment of personnel and labor, including provisions thereof relating to
wages, hours, vacation, overtime, notice, pay in lieu of notice, termination
and severance pay, obligation, human rights, occupational health and safety,
equal opportunity, collective bargaining and the payment of social security and
other Taxes, the Worker Adjustment and Retraining Notification Act, and the
Immigration Reform and Control Act of 1986, or any similar provisions of
foreign, federal, state or local law with respect to the Business;

(ii)           the Company is not a party to or bound
by any collective bargaining agreement, nor has it experienced any strikes,
grievances, unfair labor practices claims or other material employee or labor
disputes with respect to the Business. 
The Company has not engaged in any unfair labor practice with respect to
the Business and there are no charges of unfair labor practices or other
employee-related complaints pending or, to the Company’s Knowledge, threatened
against the Company before the National Labor 

 27
 

Relations
Board, the Equal Employment Opportunity Commission, the Occupational Safety and
Health Review Commission, the Department of Labor, or any other Governmental
Authority;

(iii)          the Company is not subject to any
claim for wrongful dismissal, constructive dismissal or any other claim or
complaint, actual or threatened, or any litigation, actual or threatened,
relating to employment, discrimination or termination of employment of any
employee or former employee of the Company, who is or was employed in
connection with the Business;

(iv)          neither the Company, nor to the
Company’s Knowledge, any employee of the Company is subject to any noncompete,
nondisclosure, confidentiality, employment, consulting or similar Contract with
a party other than the Company relating to, affecting or in conflict with the
Business as presently conducted;

(v)           within the sixty
(60) days preceding the Closing Date, no Employees have ceased to be employed
by the Company, whether by reason of termination or otherwise.  There are no Employees currently receiving
COBRA benefits or entitled to elect to receive COBRA benefits.

(b)   Schedule 4.16(b)
sets forth the names, present annual or, as the case may be, hourly rate of
compensation (including salary, bonuses and commissions) of all persons
employed on a full-time basis by the Company in connection with the Business
(including independent contractors) together with their job title; provided
such Schedule 4.16(b) does not include employees that are seasonal or
otherwise not employed full-time.

(c)   The
Company has not made any promises or representations to any employee or Person
concerning employment with the Company or Buyer following the Closing Date, and
the Company has not informed any employee or other Person that such Person will
receive any compensation as a result of the transactions contemplated by this
Agreement or otherwise.  The transactions
contemplated by this Agreement will not result in any liability for severance
pay to any employee of the Company or any other Person.

4.17     Employee
Benefit Plans.

(a)   Except as set forth on Schedule 4.17,
with respect to current or former employees of the Company, independent
contractors, or the spouses, beneficiaries or dependents thereof, the Company
does not maintain and has not maintained, does not contribute to and has not contributed
to, does not have and has not had any obligation to contribute to, and does not
have and has not had any actual Liability or potential Liability with respect
to any (i) deferred compensation or bonus or retirement plans or
arrangements, (ii) qualified or nonqualified defined contribution or
defined benefit plans or arrangements which are employee pension benefit plans
(as defined in Section 3(2) of ERISA), (iii) employee welfare benefit
plans (as defined in Section 3(1) of ERISA), stock option or stock
purchase plans, or fringe benefit plans or programs whether in writing or oral
and whether or not terminated, or (iv) employee benefit plan (as defined
in Section 3(3) of ERISA) or other employee benefit plan, program or
arrangement of any kind.  The Company has
never contributed to any multiemployer pension plan (as defined in 

 28
 

Section 3(37)
of ERISA), and the Company has never maintained or contributed to any defined
benefit plan (as defined in Section 3(35) of ERISA).  The plans listed on Schedule 4.17
are referred to herein as the “Plans.”

(b)   The employee pension benefit plans and
employee welfare benefit plans (and related trusts and insurance contracts)
listed on Schedule 4.17 comply in form and in operation in all
respects with the requirements of applicable laws and regulations, including
ERISA and the Code and the nondiscrimination rules thereof.  The employee pension benefit plans which are
intended to be “qualified plans” qualify under Section 401(a) of the Code,
and each such employee pension benefit plan has received a favorable
determination letter from the Internal Revenue Service as to the qualification
under the Code of such plan.  The Company
and all members of the Controlled Group have complied with the requirements of
COBRA.

(c)   With respect to each
employee pension benefit plan listed on Schedule 4.17, all
contributions which are due (including all employer contributions and employee
salary reduction contributions) have been paid to such employee pension benefit
plan and, with respect to the employee welfare benefit plans, all premiums or
other payments which are due have been timely paid.

(d)   The Company has not,
incurred any Liability to the Pension Benefit Guaranty Corporation, the
Internal Revenue Service, any multiemployer plan or otherwise with respect to
any employee pension benefit plan currently or previously maintained by members
of the controlled group of corporations or trades or businesses (as defined in
Section 414 of the Code) that includes or included the Company (the “Controlled
Group”) that has not been satisfied in full, and no condition exists that
presents a risk to the Company or any member of the Controlled Group of
incurring such a Liability.

(e)   With respect to each
employee pension benefit plan and each employee welfare benefit plan listed on Schedule 4.17
no actions, investigations, suits or claims with respect to the assets thereof
(other than routine claims for benefits) are pending or threatened, and the
Company has no Knowledge of any facts which would give rise to or could
reasonably be expected to give rise to any such actions, suits or claims.

(f)    With respect to each of the
Plans, the Company has furnished or made available to Buyer true and complete
copies of (i) the plan documents, summary plan descriptions and summaries
of material modifications and other material employee communications,
(ii) the most recent determination letter received from the Internal
Revenue Service, (iii) the Form 5500 Annual Report (including all
schedules and other attachments for the most recent three years), (iv) all
related trust agreements, insurance contracts or other funding agreements which
implement such plans and (v) all Contracts relating to each such plan,
including service provider agreements, insurance contracts, investment
management agreements and recordkeeping agreements.

4.18     Insurance.  The Company has the liability insurance
listed on Schedule 4.18.  Schedule 4.18
lists and briefly describes each insurance policy (including the type of
coverage, insurer, premium paid, policy number, named insured and expiration
date of each policy) maintained by or on behalf of the Company with respect to
the Business and the 

 29
 

Purchased Assets, together with a claims history for the past three (3)
years.  All of such insurance policies
are in full force and effect, and the Company is not in default with respect to
its obligations under any such insurance policies.  The Company has never been denied insurance
coverage with respect to any aspect of the Business or any of the Purchased
Assets.  Except as set forth on Schedule 4.18,
the Company does not have any self-insurance or co-insurance
programs with respect to the Business and the Purchased Assets.  Schedule 4.18 contains a summary
of the Company’s loss experience under each policy since January 1, 2004.  The Company has delivered to Buyer accurate
and complete copies of all policies of insurance (and correspondence relating
to coverage thereunder) that relate to the Business or the Purchased Assets to
which the Company is a party or under which the Company is or has been covered
at any time during the three (3)-year period ending on the Closing Date.

4.19     Affiliate
Transactions.  Except for the Company
Shareholders’ rights as shareholders of the Company, the Transaction Documents,
or as otherwise disclosed on Schedule 4.19, no officer, director,
employee, stockholder, or Affiliate of the Company or any individual related by
blood, marriage or adoption to any such individual or any entity in which any
such Person owns any beneficial interest (collectively, the “Insiders”),
is a party to any agreement, Contract, commitment, promissory note, loan or any
other actual or proposed transaction with the Company or the Business, or has
any material interest in any of the Purchased Assets or other property used by
the Company which is material to the operation of the Business.

4.20     Compliance
with Laws.  The Company and its
officers, directors, agents and employees have complied in all material
respects with all applicable laws, regulations and ordinances of foreign,
federal, state and local governments and all agencies thereof which are
applicable to the Business or any of the Purchased Assets, and no claims have
been filed against the Company alleging a violation of any such laws or
regulations, and the Company has not received written notice of any such
violations.  To the Company’s
Knowledge, the Company is not in default under or in violation of any, and has
complied with all, statutes, ordinances, regulations, orders, judgments and
decrees of any Governmental Authority applicable to the Company or to the
Business or the Purchased Assets.  To the
Company’s Knowledge, there is no basis for assertion of any violation of the
foregoing or for any claim for compensation or damages or otherwise arising out
of any violation of the foregoing.  The
Company has not received any written notification of any asserted present or
past failure to comply with any of the foregoing which has not been satisfactorily
responded to in the time period required thereunder.

4.21     Environmental
Matters.  Except as set forth on Schedule 4.21,
with regard to the Business, the Purchased Assets and the Owned Real Property:

(a)   The Company has complied
with and is currently in compliance with all Environmental and Safety
Requirements.  The Company has no
Liabilities, including corrective, investigatory or remedial obligations
arising under Environmental and Safety Requirements and has not received any
oral or written notice, report or information regarding any Liabilities,
including corrective, investigatory or remedial obligations arising under
Environmental and Safety Requirements which relate to the Owned Real
Property, the Business or any of
its properties or facilities or any of the Purchased Assets.

 30
 

(b)   Without limiting the
generality of the foregoing, the Company has obtained and complied with, and is
currently in compliance with, all Governmental Authorizations that may be
required pursuant to any Environmental and Safety Requirements for the occupancy
of its properties or facilities or the operation of the Business.  A list of all such Governmental
Authorizations which are material to the Company is set forth on Schedule 4.21.

(c)   Neither this Agreement or
the other Transaction Documents nor the consummation of the transactions
contemplated hereby and thereby shall impose any Liabilities on the Company
with respect to the Business, Buyer or otherwise for site investigation or
cleanup, or notification to or consent of any government agencies or third
parties under any Environmental and Safety Requirements (including any so
called “transaction-triggered” or “responsible property transfer” laws
and regulations).

(d)   None of the following exists
at any property or facility owned, occupied or operated by the Company with
respect to the Business in violation of Environmental and Safety
Requirements:  (i) underground
storage tanks or surface impoundments; (ii) asbestos-containing
material in any form or condition; or (iii) materials or equipment
containing polychlorinated biphenyls.

(e)   The Company has not treated,
stored, disposed of, arranged for or permitted the disposal of, transported,
handled or Released any Hazardous Substance in violation of Environmental and
Safety Requirements, or owned, occupied or operated any facility or property
(and no such facility or property is contaminated with any such substance), so
as to give rise to Liabilities of the Company with respect to the Business
pursuant to CERCLA or any other Environmental and Safety Requirements.

(f)    Without limiting the
generality of the foregoing, no facts, events or conditions relating to the
past or present properties, facilities or operations of the Company shall
prevent, hinder or limit continued compliance with Environmental and Safety Requirements,
give rise to any corrective, investigatory or remedial obligations pursuant to
Environmental and Safety Requirements or give rise to any other Liabilities
pursuant to Environmental and Safety Requirements, including those Liabilities
relating to onsite or offsite Releases or threatened Releases of hazardous
materials, substances or wastes (including any Hazardous Substance), personal
injury, property damage or natural resources damage.

(g)   The Company has not, either
expressly or by operation of law, assumed, undertaken or otherwise become
subject to any Liability with respect to the Business, including any
corrective, investigatory or remedial obligation, of any other Person relating
to any Environmental and Safety Requirements.

(h)   No Environmental Lien has
attached to any property owned, leased or operated by the Company with respect
to the Business.

(i)    The Company has furnished
or made available to Buyer all Governmental Authorizations, environmental
audits, reports, correspondence, notices, studies, filings with any
Governmental Authority and other material environmental documents (including,
but not limited to, any site assessment or environmental, health or safety
audit report, and including a listing of 

 31
 

all
Hazardous Substances utilized in connection with the Business) relating to the
Company and the Business which are in the Company’s possession or under its
reasonable control.

4.22     Product
Recall.  Since January 1, 2004, the
Company has not, with respect to the Business, made any formal recall of any of
its products.

4.23     Customers and Suppliers.  Schedule 4.23 sets
forth a list of each supplier that has previously supplied a material amount of
materials, products or services to the Business together with the aggregate
amount paid to such supplier from the Company during the fiscal year ended
December 31, 2006.  Except as set forth
on Schedule 1.1 with respect to customers, and Schedule 4.23
with respect to suppliers, since December 31, 2006, no customer or supplier
listed on such schedules has notified or, to the Company’s Knowledge,
threatened the Company that it intends to cease doing business with, or to
materially reduce or terminate its commitments or level of business during
calendar year 2007 with, the Business.

4.24     Books and Records.  The
books of account and other financial records of the Company, all of which have
been made available to Buyer, are, to the Knowledge of the Company, complete
and correct and represent actual, bona fide transactions and have been maintained
in accordance with sound business practices, including the maintenance of an
adequate system of internal controls. 
The minute books of the Company, all of which have been made available
to Buyer, contain accurate and complete records of all meetings held of, and
corporate action taken by, the shareholders, the board of directors and
committees of the board of directors of the Company, and no meeting of any such
shareholders, board of directors or committee has been held for which minutes
have not been prepared or are not contained in such minute books.

4.25     Disclosure.  No representation or warranty in this
Agreement, as qualified by the schedules hereto, contains any untrue statement
of a material fact or omits to state a material fact necessary to make such
representation or warranty, in light of the circumstances in which it was made,
not misleading.

4.26     Limitation on Company and Company
Shareholders’ Representations and Warranties.

BUYER ACKNOWLEDGES AND
AGREES THAT, EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN ARTICLE IV,
(I) THE PURCHASE OF THE PURCHASED ASSETS SHALL BE ON AN “AS IS”, “WHERE IS”,
“WITH ALL FAULTS BASIS”, SUBJECT TO REASONABLE WEAR AND TEAR FROM THE CLOSING
DATE, AND (II) NEITHER THE COMPANY NOR ANY OF ITS SHAREHOLDERS, DIRECTORS,
OFFICERS, EMPLOYEES, ATTORNEYS, ACCOUNTANTS, CONSULTANTS, AGENTS OR
REPRESENTATIVES, NOR ANY PERSON PURPORTING TO REPRESENT ANY OF THE FOREGOING,
HAVE MADE ANY REPRESENTATION, WARRANTY, GUARANTY, PROMISE, PROJECTION OR
PREDICTION WHATSOEVER WITH RESPECT TO THE ASSETS OR ANY ASPECT THEREOF, WRITTEN
OR ORAL, EXPRESS OR IMPLIED, ARISING BY OPERATION OF LAW OR OTHERWISE,
INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE.  BUYER ACKNOWLEDGES
AND AGREES THAT BUYER IS 

 32
 

NOT RELYING ON ANY
STATEMENT MADE OR INFORMATION PROVIDED TO BUYER BY THE COMPANY OR ANY OF ITS
SHAREHOLDERS, DIRECTORS, OFFICERS, EMPLOYEES, ATTORNEYS, ACCOUNTANTS,
CONSULTANTS, AGENTS OR REPRESENTATIVES, OR ANY PERSON PURPORTING TO REPRESENT ANY
OF THE FOREGOING, EXCEPT FOR THE REPRESENTATIONS AND WARRANTIES EXPRESSLY MADE
BY THE COMPANY AND THE COMPANY SHAREHOLDERS IN THE ABOVE ARTICLE IV OF THIS
AGREEMENT.

4.27     Disclosure.  The
Company may amend and supplement the representations in Article IV and the
related schedules to this Agreement from time to time prior to Closing by
providing a written copy of such amendment or supplement to Buyer; provided,
however, that it will remain a condition of Buyer’s obligations hereunder that
the representations and warranties as stated herein, as qualified by the
related schedules, and as amended or supplemented shall remain true and correct
as of the Closing Date; and provided further, that no representation or
warranty by any of the Company or Company Shareholders in this Agreement, as
qualified by the schedules hereto, contains any untrue statement of a material
fact or omits to state a material fact necessary to make such representation or
warranty, in light of the circumstances in which it was made, not misleading.

ARTICLE
5

REPRESENTATIONS AND WARRANTIES OF BUYER

As a material inducement to
the Company to enter into this Agreement, Buyer hereby represents and warrants
to the Company that:

5.1   Organization
and Corporate Power.  Buyer is a
corporation duly organized, validly existing and in good standing under the
laws of the State of Delaware, with full corporate power and authority to enter
into this Agreement and the other Transaction Documents to which Buyer is a
party and perform its obligations hereunder and thereunder.

5.2   Authorization
of Transactions.  The execution,
delivery and performance of this Agreement and the other Transaction Documents
to which Buyer is a party have been duly and validly authorized by all
requisite corporate action on the part of Buyer, and no other corporate
proceedings on its part are necessary to authorize the execution, delivery or
performance of this Agreement.  This
Agreement constitutes, and each of the other Transaction Documents to which
Buyer is a party shall, when executed, constitute, a valid and binding
obligation of Buyer, enforceable in accordance with their terms.

5.3   No
Violation.  Buyer is not subject to
or obligated under its certificate of incorporation, its by-laws, any
applicable law, or rule or regulation of any Governmental Authority, or any
agreement or instrument, or any license, franchise or permit, or subject to any
order, writ, injunction or decree, which would be breached or violated by its
execution, delivery or performance of this Agreement and the other Transaction
Documents to which Buyer is a party.

5.4   Governmental
Authorities and Consents.  Buyer is
not required to submit any notice, report or other filing with any Governmental
Authority in connection with the execution 

 33
 

or delivery by it of this Agreement and the other Transaction Documents
to which Buyer is a party or the consummation of the transactions contemplated
hereby or thereby.  No consent, approval
or authorization of any Governmental Authority or any other party or person is
required to be obtained by Buyer in connection with its execution, delivery and
performance of this Agreement and the other Transaction Documents to which
Buyer is a party or the transactions contemplated hereby or thereby.

5.5   Brokerage.  There are no claims for brokerage
commissions, finders’ fees or similar compensation in connection with the
transactions contemplated by this Agreement based on any arrangement or
agreement made by or on behalf of Buyer.

5.6   Disclosure.  No representation or warranty in this
Agreement, as qualified by the schedules hereto, contains any untrue statement
of a material fact or omits to state a material fact necessary to make such
representation or warranty, in light of the circumstances in which it was made,
not misleading.

ARTICLE
6

INDEMNIFICATION AND RELATED MATTERS

6.1   Survival.

(a)   Survival of
Representations, Warranties, Covenants and Agreements.  All representations, warranties, covenants
and agreements set forth in this Agreement shall survive the Closing Date.  Notwithstanding the foregoing, no Party shall
be entitled to recover for any Loss pursuant to Section 6.2(a)(i)
or Section 6.2(b)(i) unless written notice of a claim thereof is
delivered to the other Party prior to the Applicable Limitation Date.  For purposes of this Agreement, the term “Applicable
Limitation Date” means the twenty-four (24)-month anniversary of the
Closing Date; provided that the Applicable Limitation Date with respect to the
following Losses shall be as follows:

(i)            with respect to any Loss arising
from or related to a breach of the representations and warranties of the
Company and each of the Company Shareholders set forth in Section 4.10
(Taxes), the Applicable Limitation Date
shall be the thirtieth (30th) day after expiration of the statute of
limitations (including any extensions thereto to the extent that such statute
of limitations may be tolled) applicable to the Tax which gave rise to such
Loss;

(ii)           with respect to any Loss arising from
or related to a breach of the representations and warranties of the Company and
each of the Company Shareholders  set
forth in Section 4.17 (Employee Benefit Plans)
and Section 4.21 (Environmental Matters),
the Applicable Limitation Date shall be the fifth (5th) anniversary of the Closing
Date;

(iii)          with respect to any Loss arising from
or related to a breach of the representations and warranties of the Company set
forth in Section 4.1 (Organization and Corporate
Power), Section 4.2 (Authorization of
Transactions), Section 4.3 (Absence of
Conflicts) and Section 4.7 (Title to
Properties), the Applicable Limitation Date shall be the seventh (7th) anniversary of the Closing
Date.

 34
 

(b)   Special Rule For Fraud.  Notwithstanding anything in this Section 6.1
to the contrary, in the event of any breach of a representation or warranty by
a party hereto that constitutes actual fraud, the representation or warranty
shall survive consummation of the transactions contemplated in this Agreement
and continue in full force and effect without any time limitation.

(c)   Risk Allocation.  The representations, warranties, covenants
and agreements made herein, together with the indemnification provisions
herein, are intended among other things to allocate the economic cost and the
risks inherent in the transactions contemplated hereby between the Parties
hereto and, accordingly, a Party shall be entitled to the indemnification or
other remedies provided in this Agreement by reason of any breach of any such
representation, warranty, covenant or agreement by another party hereto notwithstanding
whether any employee, representative or agent of the Party seeking to enforce a
remedy knew or had reason to know of such breach, unless such representation,
warranty, covenant or agreement is qualified to “Knowledge”.

6.2   Indemnification.

(a)   Company and Company
Shareholder Indemnification.  The
Company and each of the Company Shareholders shall, jointly and severally,
indemnify Buyer and its officers, directors, employees, agents,
representatives, Affiliates, successors and permitted assigns (collectively,
the “Buyer Parties”) and hold each of them harmless from and against and
pay on behalf of or reimburse such Buyer Parties in respect of any loss
(excluding diminution in value), Liability, demand, claim, action, cause of
action, cost, damage, deficiency, Tax, penalty, fine or expense, whether or not
arising out of third party claims (including interest, penalties, reasonable
attorneys’ fees and expenses, court costs and all amounts paid in
investigation, defense or settlement of any of the foregoing) (collectively, “Losses”
and each individually, a “Loss”) which any such Buyer Party may suffer,
sustain or become subject to, as a result of, in connection with, relating or
incidental to or by virtue of:

(i)            the breach of any representation or warranty made by the
Company and each of the Company Shareholders contained in this Agreement, as
qualified by the Schedules attached hereto;

(ii)           the breach of any covenant or agreement made by the
Company or any of the Company Shareholders contained in this Agreement;

(iii)          except as disclosed on the Schedules attached hereto, any
claim for payment of fees and/or expenses as a broker or finder in connection
with the origin, negotiation or execution of this Agreement or the other
Transaction Documents or the consummation of the transactions contemplated
hereby based upon any alleged agreement, arrangement or understanding between
the claimant and the Company or any of their agents or representatives;

(iv)          any Excluded Liability; or

(v)           any Liability arising out of the matter described in Schedule
4.13.

 35
 

(b)   Buyer’s Indemnification.  Buyer shall indemnify the Company and its
officers, shareholders, directors, employees, agents, representatives,
Affiliates, successors and permitted assigns (collectively, the “the Company
Parties”) and hold each of them harmless from and against and pay on behalf
of or reimburse the Company Parties in respect of any Loss which any such
Company Party may suffer, sustain or become subject to, as the result of, in
connection with, relating or incidental to or by virtue of:

(i)            the breach of any representation or warranty made by
Buyer contained in this Agreement;

(ii)           the breach of any covenant or agreement made by Buyer
contained in this Agreement;

(iii)          except as disclosed on the Schedules attached hereto, any
claim for payment of fees and/or expenses as a broker or finder in connection
with the origin, negotiation or execution of this Agreement or the other
Transaction Documents or the consummation of the transactions contemplated hereby
based upon any alleged agreement, arrangement or understanding between the
claimant and Buyer or any of its agents or representatives;

(iv)          any Liability arising out of the ownership or operation of
the Business or Purchased Assets after the Closing Date other than Excluded
Liabilities; or

(v)           any Assumed Liability.

(c)   Limitations on Indemnity.  The indemnification provided for in
subsections (a) and (b) above is subject to the following limitations:

(i)            No party hereto will be liable hereunder with respect to
claims referred to in subsection (a)(i) or subsection (b)(i) above unless a
Party gives written notice thereof within the Applicable Limitation Date.  Notwithstanding any implication to the
contrary contained in this Agreement, so long as a Party delivers written
notice of a claim no later than the Applicable Limitation Date, the other
Parties hereto shall be required to indemnify hereunder for all Losses which
such Parties may incur (subject to the Deductible and Cap, if applicable) in
respect of the matters which are the subject of such claim, regardless of when
incurred.

(ii)           The Company and each of the Company Shareholders shall not
be liable to Buyer Parties, and Buyer shall not be liable to the Company
Parties, for any Loss arising under Section 6.2(a)(i) or Section 6.2(b)(i)
unless, and only to the extent, the aggregate amount of all such Losses exceeds
$150,000.00 (the “Deductible”),
in which case such party(ies) shall be liable for all such Losses in excess of
the Deductible, but not the initial $150,000.00; provided that the Company’s and each of the Company Shareholder’s
aggregate liability rising under Section 6.2(a)(i) or Buyer’s
aggregate liability under Section 6.2(b)(i) shall in no event
exceed $2,000,000.00, respectively (the “Cap”);
provided further that the foregoing limitations (i.e., the Deductible and the
Cap) shall not apply with respect to any Loss arising from or related to a
breach of:

 36
 

(A) the covenants
of the Company or each of the Company Shareholders in Section 7.6 (Non-Competition; Non-Solicitation and Confidentiality)
or any of the matters referred to in Sections 6.2(a)(iii) and 6.2(a)(iv)
above or

(B) the
representations and warranties of the Company and each of the Company
Shareholders set forth in Section 4.1 (Organization and Corporate Power), Section 4.2 (Authorization of Transactions), Section 4.3
(Absence of Conflicts), Section 4.7
(Title to Properties),  Section 4.10 (Taxes), or Section 4.21 (Environmental Matters).

(iii)          To the extent any claim for indemnification by any Buyer
Party is covered by applicable insurance, Buyer agrees that it must first use
commercially reasonable efforts to seek recovery from such insurance and the
indemnification claim shall be reduced to the extent of any such insurance
proceeds actually paid to Buyer.

(d)   Procedure.  If a party hereto seeks indemnification under
this Article 6 (the “Indemnified Party”) with respect to any
claim, demand, action, proceeding or other matter pursuant to this Agreement or
arising out of the transactions contemplated hereby (the “Claim”), the
Indemnified Party shall give written notice to the other party(ies) (the “Indemnifying
Party”) after receiving written notice of or discovering facts giving rise
to the Claim (a “Notice of Claim”), which Notice of Claim shall contain
the following information to the extent it is reasonably available to the
Indemnified Party:  (i) an estimate
of the amount then reasonably ascertainable of the alleged loss, expense or
liability against which the Indemnified Party is indemnified; (ii) a
description, in reasonable detail, of the circumstances giving rise to the
alleged loss, expense, or liability; and (iii) a statement identifying
each party against whom a Claim is asserted; provided that the failure to so
notify the Indemnifying Party shall not relieve the Indemnifying Party of its
or his obligations hereunder except to the extent the Indemnifying Party is
materially prejudiced by such failure. 
If the Indemnifying Party notifies the Indemnified Party within thirty
(30) days after receiving the Notice of Claim that it will assume the defense
thereof:

(i)            the Indemnifying Party shall defend the Indemnified Party
against the matter with counsel of the Indemnifying Party’s choice reasonably
satisfactory to the Indemnified Party;

(ii)           the Indemnified Party may retain separate counsel at its
sole cost and expense (except that the Indemnifying Party will be responsible
for the fees and expenses of the separate counsel to the extent the
Indemnifying Party reasonably concludes based upon advice of counsel that a
conflict of interest exists between the Indemnified Party and Indemnifying
Party based on the existence of one or more legal defenses available to the
Indemnified Party which are not available to the Indemnifying Party, or available
to the Indemnifying Party, but the assertion of which would be adverse to the
interest of the Indemnified Party);

(iii)          the Indemnified Party will not consent to the entry of any
judgment or enter into any settlement with respect to the matter without the
written consent of the Indemnifying Party (not to be withheld unreasonably);
and

 37
 

(iv)          the Indemnifying Party will not consent to the entry of any
judgment or enter into any settlement which does not include a provision
whereby the plaintiff or claimant in the matter releases the Indemnified Party
from all liability with respect thereto, without the written consent of the
Indemnified Party (not to be withheld unreasonably).

If the Indemnifying Party does not notify the Indemnified Party within
thirty (30) days that it will assume the defense thereof, then the Indemnified
Party may defend against, or enter into any settlement with respect to, the
matter in any manner it reasonably may deemed appropriate, without prejudice to
any of its rights hereunder.  The
Indemnified Party and the Indemnifying Party shall each use commercially
reasonable efforts to cooperate with the other such Party in connection with
the defense of third-party Claims.

(e)   Payments.  The Indemnifying Party shall pay the
Indemnified Party in immediately available funds for any actual Loss that has
occurred promptly after the Indemnified Party provides the Indemnifying Party
with written notice of a claim hereunder and such parties reasonably agree that
there is a reasonable basis for such claim.

(f)    Right of Setoff.  Subject to Section 2.10, which
includes the process under which Buyer may request funds from the Escrow, Buyer
shall have the right to obtain any amount Buyer is entitled to receive from the
Company or any Company Shareholder under this Article 6 from the
Escrow or any other amounts otherwise payable by Buyer to the Company or any
Company Shareholder under this Agreement.

(g)   Purchase Price
Adjustments.  Amounts paid to or on
behalf of the Company or Buyer as indemnification shall be treated as
adjustments to the Purchase Price.

(h)   Maximum Contribution.  If and to the extent any provision of this Article 6
is unenforceable for any reason, the Indemnifying Party hereby agrees to make
the maximum contribution to the payment and satisfaction of any Loss for which
indemnification is provided for in this Section 6.2 which is
permissible under applicable legal requirements.

(i)    Exclusive Remedy.  The provisions of this Section 6.2
shall be the Parties’ exclusive remedy to recover monetary damages pursuant to
this Agreement; provided, however, that the foregoing shall not in any way
diminish  any Party’s right to maintain
or recover (i) any Working Capital Adjustment, (ii) any other amounts
in connection with any action or claim based on fraud or willful
misrepresentation, (iii) any remedy under Section 7.6, or
(iv) any other remedy of specific performance otherwise available to any
party hereunder or under applicable laws.

ARTICLE
7

ADDITIONAL AGREEMENTS

7.1   Tax
Matters.

(a)   Transfer Taxes.  All transfer, documentary, use, stamp,
registration, sales and other such Taxes and fees (including any penalties and
interest thereon) incurred in connection with this Agreement shall be paid by
the Company when due, and the Company shall, at its own 

 38
 

expense,
file all necessary Tax Returns and other documentation with respect to all such
transfer, documentary, use, stamp, registration, sales and other Taxes and
fees, and if required by applicable law, Buyer shall, and shall cause its
Affiliates to, join in the execution of any such Tax Returns and other
documentation.

(b)   Allocation.  Buyer and the Company shall jointly allocate
the Purchase Price in accordance with Section 1060 of the Code (the “Allocation”)
among the Purchased Assets using the methodology and allocation amounts set
forth on the Schedule 7.1(b) attached hereto.  The allocation will be generally consistent
with the Letter of Intent.  Fixed assets
will be valued at their appraised values, inventory will be valued at fair
market value (which is assumed to approximate the current cost, not the LIFO
value), and any excess Purchase Price allocation will be applied to
goodwill.  For purposes of the
Allocation, the Purchase Price shall include Assumed Liabilities for U.S.
federal income Tax purposes.  To the
extent that the Purchase Price is adjusted after the Closing Date pursuant to Section 2.7,
Buyer and the Company agree to revise and amend the Allocation in accordance
with the character of each such adjustment, consistent with the methodology set
forth on Schedule 7.1(b). 
The Company and Buyer agree to prepare and file an IRS Form 8594 or such
other form or statement as may be required by applicable law, rule or
regulation, and any comparable state or local income tax form, in a manner consistent
with the Allocation.  The Company and
Buyer shall adhere to the Allocation for all Tax-related purposes including any
federal, foreign, state, county or local income and franchise Tax Return filed
by them after the Closing Date, including the determination by the Company of
taxable gain or loss on the sale of the Purchased Assets and the determination
by Buyer of its tax basis with respect to the Purchased Assets.  Neither Buyer nor the Company shall file any
Tax Returns or, in a judicial or administrative proceeding, assert or maintain
any Tax reporting position that is inconsistent with this Agreement or the
Allocation agreed to in accordance with this Agreement, unless required to do
so by applicable law.

(c)   The Parties hereto agree
that the Purchase Price and the Assumed Liabilities will be allocated to the
Purchased Assets for all purposes (including Tax and financial accounting
purposes) in a manner consistent with the fair market values as reasonably
determined and described above in Section 7.1(b) by Buyer and the
Company prior to Closing.  The Company
and Buyer will file all Tax Returns (including amended returns and claims for
refund) and information reports in a manner consistent with such values and
allocation.

(d)   Cooperation on Tax Matters.  Buyer and the Company shall cooperate fully,
as and to the extent reasonably requested by any Party, in connection with the
filing of Tax Returns for the Business and any audit, litigation or other
proceeding with respect to Taxes for the Business.  Such cooperation shall include the retention
and (upon any Party’s request) the provision of records and information which
are reasonably relevant to any such audit, litigation or other proceeding and
making employees available on a mutually convenient basis to provide additional
information and explanation of any material provided hereunder.  The Company agrees (i) to retain all
books and records with respect to Tax matters and pertinent to the Business
relating to any taxable period beginning before the Closing Date until the
expiration of the statute of limitations (and, to the extent notified by Buyer,
any extensions thereof) for the respective taxable periods, and to abide by all
record retention agreements entered into with any taxing authority, and (ii) to
give Buyer reasonable written notice prior to transferring, destroying 

 39
 

or
discarding any such books and records and, if Buyer so requests, the Company
shall allow Buyer to take possession of such books and records.

7.2   Press
Releases and Announcements.  Prior to
the Closing Date, no press releases related to this Agreement and the
transactions contemplated herein, or other announcements to the employees,
customers or suppliers of the Company shall be issued by the Company, the
Company Shareholders or Buyer without the approval of all Parties, except as
required by law or regulation (in which case the disclosure shall be prepared
jointly by the Company and Buyer).  After
the Closing Date, no press releases related to this Agreement and the transactions
contemplated herein, or other announcements to the employees, customers or
suppliers of the Company shall be issued by the Company or the Company
Shareholders without the approval of Buyer, except as required by law or
regulation (in which case the disclosure shall be prepared jointly by the
Company and Buyer).

7.3   Further
Transfers.  The Company shall execute
and deliver such further instruments of conveyance and transfer and take such
additional action as Buyer may reasonably request (provided the Company incurs
no out-of-pocket costs in taking such actions) to effect, consummate, confirm
or evidence the transfer to Buyer of the Purchased Assets and any other
transactions contemplated hereby.  The
Company will execute such documents as may be necessary to assist Buyer in
preserving or perfecting its rights in the Purchased Assets.  Buyer will execute and deliver such further
instruments and take such additional actions as the Company may reasonably
request to effect, consummate, confirm or evidence the assumption by Buyer of
the Assumed Liabilities and any other transactions contemplated hereby.

7.4   Specific
Performance.  Each of the Company and
the Company Shareholders  acknowledges
that the Business is unique and recognizes and affirms that in the event of a
breach of this Agreement by the Company or any Company Shareholder, money
damages may be inadequate and Buyer may have no adequate remedy at law.  Accordingly, each of the Company and the
Company Shareholders agrees that Buyer shall have the right, in addition to any
other rights and remedies existing in its favor, to enforce its rights and the
obligations of the Company and each of the Company Shareholders hereunder not
only by an action or actions for damages but also by an action or actions for specific
performance, injunctive and/or other equitable relief.  If any such action is brought by Buyer to
enforce this Agreement, each of the Company and the Company Shareholders hereby
waives the defense that there is an adequate remedy at law.

7.5   Expenses.  Except as otherwise provided herein, each
Party shall pay all of its, his or her own fees, costs and expenses (including
fees, costs and expenses of legal counsel, investment bankers, accountants,
brokers or other representatives and consultants and appraisal fees, costs and
expenses) incurred in connection with the negotiation of the Letter of Intent,
this Agreement, the other Transaction Documents, the performance of its, his or
her obligations hereunder and thereunder, and the consummation of the transactions
contemplated hereby and thereby.

7.6   Non-Competition;
Non-Solicitation and Confidentiality.

(a)   Non-competition.  The Company and each of the Company
Shareholders  (the “Restricted
Parties”) covenants and agrees, in further consideration of the Purchase
Price and 

 40
 

other
good and valuable consideration (the receipt and sufficiency of which are
hereby acknowledged), that during the period beginning on the Closing Date and
ending on the five (5)-year anniversary of the Closing Date (the “Non-Compete
Period”), such party will not, and will cause its Affiliates not to,
directly or indirectly, own any interest in, operate, manage, join, control,
finance, participate in the ownership, management, operation or control of, or
be paid or employed by, or acquire any securities of, or otherwise become
associated with or provide assistance to, as an employee, consultant, director,
officer, shareholder, partner, member, agent, associate, principal, creditor,
representative or in any other capacity, any sole proprietorship or business
entity engaged either directly or indirectly in the sourcing, manufacture,
distribution and/or sale of vegetables and berries, including farming,
harvesting, packaging and selling (each and collectively, a “Competitive
Business”) in the United States and each, state, territory, county, city or other political
subdivision of the United States (the “Restricted Territory”), except as
contemplated by the Employment Agreement or the Ground Lease. 
Notwithstanding the foregoing, each of the Restricted Parties shall not
be prohibited from being a passive owner of not more than two percent (2%) of
the outstanding shares of any publicly-held Competitive Business that has
shares listed for trading on a securities exchange registered with the Securities
and Exchange Commission or through an automated quotation system of a
registered securities association so long as such Person does not have active
participation in the business of such Competitive Business.

(b)   Non-Solicitation.  Each of the Restricted Parties agrees that,
without the prior written consent of Buyer, during the five (5)-year period
beginning on the Closing Date, such Restricted Party shall not, directly or
indirectly, contact, approach or solicit for the purpose of offering employment
(whether as an employee, consultant, agent, independent contractor or
otherwise) or actually hire any person employed by Buyer at any time after the
Closing Date.  Each of the Restricted
Parties agrees that it shall not take any action that would reasonably be
expected to interfere with or damage Buyer’s business relationships with its
employees, customers, suppliers, distributors, brokers or other material
business relations.

(c)   Confidentiality.  Each of the Restricted Parties shall treat
and hold as confidential any information concerning the Business or the
Purchased Assets that is not generally available to the public (the “Confidential
Information”), refrain from using any of the Confidential Information
except in connection with this Agreement and the other Transaction Documents,
and deliver promptly to Buyer, at the request and option of Buyer, all tangible
embodiments (and all copies) of the Confidential Information which are in its
possession or under its control.  In the
event that any of the Restricted Parties is requested or required (by oral
question or request for information or documents in any legal proceeding,
interrogatory, subpoena, civil investigative demand, or similar process) to
disclose any Confidential Information, such Party shall notify Buyer promptly
of the request or requirement so that Buyer may seek an appropriate protective
order or waive compliance with the provisions of this Section 7.6(c).  If, in the absence of a protective order or
the receipt of a waiver hereunder, any of the Restricted Parties is, on the
advice of counsel, compelled to disclose any Confidential Information to any
tribunal or else stand liable for contempt, such Party may disclose the
Confidential Information to the tribunal; provided that such disclosing Party
shall use reasonable efforts to obtain, at the request and expense of Buyer, an
order or other assurance that confidential treatment shall be accorded to such
portion of the Confidential Information required to be disclosed as Buyer shall
designate.

 41
 

(d)   Remedy for Breach.  Each Party acknowledges and agrees that in
the event of a breach of any of the provisions of this Section 7.6,
monetary damages shall not constitute a sufficient remedy.  Consequently, in the event of any such
breach, each Party and/or its respective successors or assigns may, in addition
to other rights and remedies existing in their favor, apply to any court of law
or equity of competent jurisdiction for specific performance and/or injunctive
or other relief in order to enforce or prevent any violations of the provisions
hereof, in each case without the requirement of posting a bond or proving
actual damages.

(e)   Enforcement.  If the final judgment of a court of competent
jurisdiction declares that any term or provision of this Section 7.6
is invalid or unenforceable, each of the Company, the Company Shareholders and
Buyer agree that the court making the determination of invalidity or
unenforceability shall have the power to reduce the scope, duration, or area of
the term or provision, to delete specific words or phrases, or to replace any
invalid or unenforceable term or provision with a term or provision that is
valid and enforceable and that comes closest to expressing the intention of the
invalid or unenforceable term or provision, and this Agreement shall be
enforceable as so modified after the expiration of the time within which the
judgment may be appealed.  Without
limiting the generality of the foregoing, if a court of competent jurisdiction
determines that:

(i)            The geographic scope is
unenforceable under applicable law because it is too broad, the Restricted
Territory shall be amended by eliminating geographical areas and states from
the following list until the Restricted Territory is determined to be
reasonable:  Arizona, Alabama, Alaska,
Arizona, Arkansas, California, Colorado, Connecticut, Delaware, District of
Columbia, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas,
Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota,
Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Jersey,
New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon,
Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Texas,
Utah, Vermont, Virginia, Washington, District of Columbia, West Virginia,
Wisconsin, Wyoming, Washington, Whatcom County, Washington and Lynden,
Washington.  The parties acknowledge and
agree that if any of the geographic areas or States listed above are required
by law to be eliminated, it would be fair and appropriate to do so in the
inverse order of the volume of revenue received or projected to be received by
the Company from such area or State at the time of determination.

(ii)           The time period for the restriction
is unenforceable because it is too long, the time period shall be for the
longest of the following periods that the court determines is reasonable under
the circumstances:  4 years, 3 years, 2
years, 1 year, 11 months, 10 months, 9 months, 8 months, 7 months, or 6 months
after the Closing Date.

(f)    Acknowledgment.  The Company and each of the Company
Shareholders acknowledges and agrees that (i) the restrictions contained
in this Section 7.6 are reasonable in all respects (including with
respect to subject matter, time period and geographical area) and are necessary
to protect Buyer’s interest in, and value of, the Business (including the
goodwill inherent therein), (ii) the Company is primarily responsible for
the creation of such value, and (iii) Buyer would not have consummated the
transactions contemplated hereby without the restrictions contained in this Section 7.6.

 42
 

7.7   Employee and Employee Benefit Matters

(a)   Effective as of the Closing
Date, Buyer shall offer employment to the employees of the Company who are
actively employed by the Company as of the Closing Date and other employees of
the Company that are listed on Schedule 4.16(b), except Lyle Rader
and Sue Rader, (collectively, the “Employees”) on such terms and
conditions as are acceptable to Buyer in its sole discretion.  All Employees who, on or immediately after
the Closing Date, accept any offer of employment from Buyer and become
employees of Buyer shall be referred to herein as the “Transferred Employees”.

(b)   Buyer
agrees that, at the Closing Date, it shall provide benefits similar to those
currently provided by the Company to the Transferred Employees (including
vacation, sick time, health and insurance benefits) and Buyer shall assume, be
responsible for, perform and pay for such benefits for the Transferred Employees;
provided, however, that such benefits shall not include any retirement
benefits, including but not limited to any Simple IRA plans previously
maintained by the Company.  Buyer
reserves the right to transition Transferred Employees to alternative benefit
plans at any time in its sole discretion.

(c)   Buyer shall
assume all Liability for providing and administering all required notices and
benefits under COBRA to Transferred Employees. 
The Company shall retain all Liability for providing and administering all
required notices and benefits under COBRA to all Employees other than
Transferred Employees and to any “M&A qualified beneficiaries” as defined
under Treasury Regulation Section 54.4980B-9.

(d)   Without limiting the
generality of the Excluded Liabilities, the Company agrees that it shall
retain, be responsible for, perform and pay:

(i)            all Liabilities (including, but not limited to, any claim
of any governmental agency, any trustee, any fiduciary, any plan administrator,
any person dealing with any Plan, any employee or any beneficiary and without
regard to whether such Liability arises prior to or after the Closing Date or
results from an event, prior to or after the Closing Date) which relate to
(A) any program, plan, policy or arrangement (whether or not terminated)
(w) which is or has been maintained, established, or offered by  the Company, (x) to which the Company
contributes or has contributed, (y) to which the Company has or has had
any obligation to contribute, or (z) to which the Company has or has had
any Liability or potential Liability 
including, but not limited to, any Plan; all Liabilities relating to any
such program, plan, policy, or Plan, which may result as a violation of law or
any Liability, including any potential or actual Liability, relating to any
failure to comply with the requirements of law;

(ii)           duties and Liabilities relating to any claims by current
or former employees or independent contractors (including dependents, spouses
and other beneficiaries thereof) of the Company or its Subsidiaries (or any
predecessors) for:  (A) medical
costs and expenses incurred as a result of claims, injuries, facts or
conditions suffered on or prior to the Closing Date including any claims, costs
or expenses relating to or arising under any Plan (including any claims, costs
or expenses related to continuation coverage provided to any former employee or
dependent thereof as of or 

 43
 

prior to the Closing Date),
and (B) costs, expenses and other Liabilities under any workers’
compensation laws, regulations, requirements or programs to the extent related
to any claim arising from or alleged to arise from or in connection with any
fact, event, claim, injury or condition occurring on or prior to the Closing
Date;

(iii)          duties, contributions and Liabilities relating to any claims for
notice, pay in lieu of notice, severance pay, vacation pay, bonus, commissions,
overtime pay, death, disability or other health or welfare or fringe benefits,
including any benefit offered or available under any Plan, payable as a result
of facts, actions or conditions occurring on or prior to the Closing Date or
which are provided to any Person who is not an active employee (or a dependent
thereof) of the Company on or immediately prior to the Closing Date; and

(iv)          contributions, premiums, duties and Liabilities relating to the Company’s
obligation to contribute to any Plan with respect to the operation of the
Company’s business on or prior to the Closing Date (regardless of when any such
contribution is required to be made).

7.8   Insurance.  The Parties acknowledge that insurance
coverage applicable to the Business for periods prior to Closing is maintained
by the Company and, except as otherwise set forth herein, the insurance
policies governing such Business are not being transferred to Buyer at Closing
(the policies for the benefit of the Business but not being transferred to
Buyer, the “Retained Policies”). 
The
Company covenants and agrees that (i) it shall maintain, without amendment
or modification, the Retained Policies (or if such policies are terminated,
substantially equivalent policies that come into effect immediately upon such
termination) for the benefit of the Business, with respect to occurrences prior
to the Closing Date, regardless of whether claims are brought prior to or after
the Closing Date; (ii) prior to Closing, the Company shall give notice to
the insurers under the Retained Policies and other policies of each claim then
pending or threatened with respect to any of the Purchased Assets or the Business
which they reasonably expect to exceed 50% of the applicable deductible or
other loss retention feature of the Retained Policies; (iii) Buyer will,
with respect to the Purchased Assets and the Business, be provided full
coverage under the Retained Policies after the Closing (subject only to
deductibles, self-insured retentions and policy limits thereof set forth on Schedule 4.18),
with respect to occurrences prior to the Closing, regardless of whether claims
are brought prior to or after the Closing; (iv) after Closing, Buyer will
have the right to bring claims (whenever brought) as a direct insured party
under the Retained Policies for all occurrences that relate to actions, events,
conditions and/or operations of the Purchased Assets and the Business prior to
and on the Closing Date within the scope of the Retained Policies; and
(v) the Company shall cause Buyer to be an “additional named insured”
under each Retained Policy and shall ensure that Buyer will, in such capacity,
have the same coverage under such insurance after the Closing as existed for
the Purchased Assets and the Business prior to Closing.  The Company will be responsible for
satisfying any deductibles, self-insured portions, retentions and other
retained amounts on insurance coverage with respect to losses arising under
claims made under the Retained Policies.

7.9   Transition
Services.  The Company shall not in
any manner take any action which is designed, intended or might reasonably be
anticipated to have the effect of discouraging customers, suppliers, vendors,
service providers, employees, lessors, licensors and other business 

 44
 

relations from maintaining the same business relationships with the
Business after the date of this Agreement. 
The Company shall refer all customer inquiries relating to the Business
to Buyer from and after the Closing Date.

7.10     Discharge
of Liabilities.  The Company shall
pay and perform all of the Excluded Liabilities (including Indebtedness
incurred by the Company in connection with the operation of the Business
outstanding as of the Closing Date) in a timely manner and so as to prevent
claims by third parties against the Buyer Parties.

7.11     Use of Names.  The Company shall, on or before
June 1, 2007, change its name to a name that does not include the words “Rader
Farms”, or any name confusingly similar to any of the foregoing.  For the avoidance of doubt, as between Buyer
and its Affiliates, on the one hand, and the Company and its Affiliates, on the
other hand, Buyer and its Affiliates shall have the exclusive right to use such
names from and after June 1, 2007 (it being understood and agreed that such
names are included as Purchased Assets). 
The Company Shareholders hereby covenant and agree to consent to such
name change.

7.12     Right to Berries.  When
available, Buyer shall provide Company Shareholders with berries produced by
the Business free of charge, which berries shall be made available for pick up
by Company Shareholders in reasonable amounts at such reasonable times and
place(s) as Buyer shall designate.  The
amount of such berries provided to Company Shareholders shall not exceed a
reasonable amount for personal consumption by Company Shareholders and shall
not be re-sold.

ARTICLE
8

MISCELLANEOUS

8.1   Amendment
and Waiver.  This Agreement may be
amended and any provision of this Agreement may be waived, provided that any
such amendment or waiver shall be binding upon a Party only if such amendment
or waiver is set forth in a writing executed by such Party.  No course of dealing between or among any
persons having any interest in this Agreement shall be deemed effective to
modify, amend or discharge any part of this Agreement or any rights or
obligations of any Party under or by reason of this Agreement.

8.2   Notices.  All notices, demands and other communications
given or delivered under this Agreement shall be in writing and shall be deemed
to have been given when personally delivered, mailed by first class mail,
return receipt requested, or delivered by express courier service or by
facsimile, if a facsimile number is provided below (with hard copy to
follow).  Notices, demands and
communications to the Company and the Company Shareholders and Buyer shall,
unless another address is specified in writing, be sent to the address or fax
number indicated below:

 45
 

 

	
  Notices to the Company and the Company
  Shareholders:

  	
  with a copy to:

  
	
   

  	
   

  
	
  Lyle Rader

  8629 Benson Road

  Lynden, WA 98246

   

  	
  Hillis Clark Martin & Peterson,
  P.S.

  1221 Second Avenue, Suite 500

  Seattle, WA  98101

  Attn: 
  Gabriel S. Rosenthal

  Fax: 
  (206) 623-7789

   

  
	
  Notices to Buyer:

  	
  with
  a copy to:

  
	
   

  	
   

  
	
  Rader Farms Acquisition Corp.

  5050 N. 40th Street, Suite 300

  Phoenix, AZ 85018

  Attention: 
  Steve Weinberger

  Fax: 
  (602) 522-2690

  	
  Osborn Maledon, PA

  2929 N. Central Ave., 21st Floor

  Phoenix, AZ  85012

  Attention:  Christopher S. Stachowiak

  Fax:  (602) 664-2055

  

 

8.3   Binding
Agreement; Assignment.  This
Agreement and all of the provisions hereof shall be binding upon and inure to
the benefit of the Parties hereto and their respective successors and assigns;
provided that neither this Agreement nor any of the rights, interests or
obligations hereunder may be assigned by the any Party hereto without the prior
written consent of all other Parties.

8.4   Severability.  Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Agreement is held to be
prohibited by or invalid under applicable law, such provision shall be
ineffective only to the extent of such prohibition or invalidity, without
invalidating the remainder of such provisions or the remaining provisions of
this Agreement.

8.5   Construction.  The language used in this Agreement shall be
deemed to be the language chosen by the Parties to express their mutual intent,
and no rule of strict construction shall be applied against any Person.  Any reference to any federal, state, local or
foreign statute or law shall be deemed also to refer to all rules and
regulations promulgated thereunder, unless the context otherwise requires.  The word “including” shall mean including
without limitation.  Nothing in the
schedules hereto shall be deemed adequate to disclose an exception to a
representation or warranty made herein unless the schedule identifies the
exception with reasonable particularity and describes the relevant facts in
reasonable detail.  The Parties intend
that each representation, warranty, and covenant contained herein shall have
independent significance.  In addition,
each of the Parties acknowledges and agrees that any Purchase Price adjustment
as a result of the application of Section 2.7 does not prejudice or
limit in any respect whatsoever any Party’s rights to indemnification under any
other provision of this Agreement.

8.6   Captions
and Headings.  The captions used in
this Agreement are for convenience of reference only and do not constitute a
part of this Agreement and shall not be deemed to limit, characterize or in any
way affect any provision of this Agreement, and all provisions of this Agreement
shall be enforced and construed as if no caption had been used in this
Agreement.

 46
 

8.7   Entire
Agreement.  The schedules identified
in this Agreement are incorporated herein by reference.  This Agreement and the documents referred to
herein contain the entire agreement between the Parties and supersede any prior
understandings, agreements or representations by or between the Parties,
written or oral, which may have related to the subject matter hereof in any
way, including the Letter of Intent.

8.8   Counterparts.  This Agreement may be executed in multiple
counterparts, each of which shall be deemed an original but all of which taken
together shall constitute one and the same instrument.

8.9   Governing
Law.  All questions concerning the
construction, validity and interpretation of this Agreement shall be governed
by and construed in accordance with the domestic laws of the State of Arizona,
without giving effect to any choice of law or conflict of law provision
(whether of the State of Arizona or any other jurisdiction) that would cause
the application of the laws of any jurisdiction other than the State of  Arizona.

8.10     Parties
in Interest.  Nothing in this
Agreement, express or implied, is intended to confer on any Person other than
the Parties and their respective successors and assigns any rights or remedies
under or by virtue of this Agreement.

8.11     CONSENT
TO JURISDICTION.  THE PARTIES AGREE
THAT JURISDICTION AND VENUE IN ANY ACTION BROUGHT BY ANY PARTY PURSUANT TO THIS
AGREEMENT SHALL PROPERLY (BUT NOT EXCLUSIVELY) LIE IN ANY FEDERAL OR STATE
COURT LOCATED IN PHOENIX, ARIZONA.  BY
EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH PARTY IRREVOCABLY SUBMITS TO THE
JURISDICTION OF SUCH COURTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY WITH
RESPECT TO SUCH ACTION.  THE PARTIES
IRREVOCABLY AGREE THAT VENUE WOULD BE PROPER IN SUCH COURT, AND HEREBY WAIVE
ANY OBJECTION THAT SUCH COURT IS AN IMPROPER OR INCONVENIENT FORUM FOR THE
RESOLUTION OF SUCH ACTION.  THE PARTIES
FURTHER AGREE THAT THE MAILING BY CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT
REQUESTED, OF ANY PROCESS REQUIRED BY ANY SUCH COURT SHALL CONSTITUTE VALID AND
LAWFUL SERVICE OF PROCESS AGAINST THEM, WITHOUT NECESSITY FOR SERVICE BY ANY
OTHER MEANS PROVIDED BY STATUTE OR RULE OF COURT.

8.12     Delivery
by Facsimile or Electronic Transmission. 
This Agreement and any Transaction Document, and any amendments hereto
or thereto, to the extent signed and delivered by means of a facsimile machine
or electronic transmission, shall be treated in all manner and respects as an
original contract and shall be considered to have the same binding legal
effects as if it were the original signed version thereof delivered in
person.  At the request of any Party
hereto or to any such contract, each other Party hereto or thereto shall re-execute
original forms thereof and deliver them to all other Parties. No Party hereto
or to any such contract shall raise the use of a facsimile machine or
electronic transmission to deliver a signature or the fact that any signature or
contract was transmitted or communicated through the use of facsimile machine
or electronic transmission as a defense to the formation of a contract and each
such Party forever waives any such defense.

 47
 

8.13     Attorneys’
Fees.  In the event of a dispute
regarding the interpretation or enforcement of this Agreement, the prevailing
party in such dispute shall be entitled to recover its reasonable attorneys’
fees and costs incurred in connection therewith, including but not limited to
fees and costs of trial and in appeal.

[Signature Page Follows]

 48

IN WITNESS WHEREOF, the undersigned have executed this Asset Purchase
Agreement as of the date first written above.

	
  

  	
  THE COMPANY:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  RADER FARMS,
  INC.

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Lyle Rader

  	
   

  
	
   

  	
  Name:

  	
  Lyle Rader

  	
   

  
	
   

  	
  Its:

  	
  President

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  COMPANY
  SHAREHOLDERS:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  /s/ Lyle Rader

  	
   

  
	
   

  	
  Lyle Rader

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  /s/ Sue Rader

  	
   

  
	
   

  	
  Sue Rader

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BUYER:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  RADER FARMS
  ACQUISITION CORP.

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Steve
  Weinberger

  	
   

  
	
   

  	
  Name:

  	
  Steve Weinberger

  	
   

  
	
   

  	
  Its:

  	
  Secretary and
  Treasurer

  	
   

  

 

Signature Page to Asset Purchase AgreementEXHIBIT
10.2

AGRICULTURAL
GROUND LEASE

THIS AGRICULTURAL
GROUND LEASE (“Lease”) is made and entered into as of May 17, 2007 (the “Effective
Date”) by and between Lyle Rader, Sue Rader, Brad Rader and Julie Newell
(formerly known as Julie Rader) (collectively, “Lessor”), and RADER
FARMS ACQUISITION CORP., a Delaware corporation (“Lessee”).

RECITALS

A.            Lessor is the owner of
that certain real property located in Whatcom County, Washington, consisting of
approximately 696 acres, more or less, as more particularly described on Exhibit ”A”
attached hereto and incorporated herein by this reference (the “Property”).

B.            Lessee desires to
lease the Property from Lessor and subject to the terms and conditions set
forth below, to manage and conduct farming operations on the Property.

C.            Lessor is willing to
lease the Property to Lessee, subject to the terms and conditions set forth
below.

AGREEMENTS

NOW, THEREFORE,
for good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereby agree as follows:

1.             Leased
Premises.  Lessor hereby leases to
Lessee, and Lessee hereby leases from Lessor, upon the terms and conditions set
forth in this Lease, the approximately 696 acres of real property described in Exhibit ”A”, together with all
improvements and structures thereon and all appurtenant rights thereto,
including, without limitation, wells, pumps, motors, electrical panels,
electrical hookups, water discharge facilities, pipelines, irrigation systems,
easements, rights-of-way for ingress and egress, licenses and water rights and
privileges (collectively, the “Premises”).

2.             Term.  The term of this Lease shall commence on the
Effective Date, and end ten (10) years thereafter (the “Lease Term”).

3.             Rent.

3.1          Commencement
of Rent Payments.  As and for rental
of the Premises, Lessee shall pay to Lessor annual rent (the “Rent”) in
the amounts determined in accordance with this Section 3, such Rent
to be paid in equal monthly installments on or before the first (1st) day of
each month.

3.2          Payment.  All payments of Rent shall be payable in
lawful money of the United States of America in immediately available funds,
and shall be payable without offset, deduction or counterclaim except as
otherwise allowed herein, and without notice or demand at the address of Lessor
specified in Section 30 below or at such other address as Lessor
may designate from time to time to Lessee in writing.

3.3          Initial
Rent.  Beginning on the Effective
Date and continuing until May 17, 2017, Rent will be due and payable at
the rate of Forty-Three Thousand Five Hundred and No/100 Dollars ($43,500.00)
per month (Five Hundred Twenty-Two Thousand and No/100 Dollars ($522,000.00)
per annum).

3.4          Rent
After Tenth Year.  Beginning on May 18,
2017, Rent shall increase to Fifty-Two Thousand Two Hundred and No/100 Dollars
($52,200.00) per month (Six Hundred Twenty-Six Thousand Four Hundred and No/100
Dollars ($626,400.00) per annum).

3.5          Pro
Rata Rent.  If the Effective Date
occurs on a date other than the first day of a month, and if the rent increase
specified in Section 3.4 above commences on other than the first
day of a month, Rent shall be prorated in such month on the basis of the actual
number of days in such month.

4.             Real
Property and Water District Taxes and Assessments; Water Costs.  All real estate taxes, assessments or similar
levies of any kind and all water district taxes, assessments or similar levies
of any kind levied against the Premises as of the Effective Date and assessed
or falling due during the Lease Term shall be paid by Lessee.  All such taxes, assessments or similar levies
shall be prorated for Lessee’s period of occupancy.  All taxes and assessments assessed against or
attributable to improvements placed upon the Premises by the Lessee and Lessee’s
personal property on the Premises, shall be paid by Lessee.  The cost of water, together with any water
standby or other charges, necessary for the adequate and proper irrigation of
crops grown on the Premises shall be borne by Lessee.

5.             Utilities.  Lessee shall pay for all charges for light,
power, and all other services and utilities supplied to the Premises during the
Lease Term.

6.             Water
Supply.  Any and all of Lessor’s
rights to extract any groundwater beneath the Premises, use of any irrigation district
facilities serving the Premises, and any future allocations of irrigation water
from any irrigation district to which the Premises might be entitled during the
Lease Term are hereby transferred to Lessee for the Lease Term.

7.             Compliance
with Laws; Waste.

7.1          Compliance
with Laws.  Lessee shall not do or
suffer to be done on or about the Property, anything that would or does violate
or conflict with any law, ordinance, rule or regulation now in force or effect,
or that may hereinafter be enacted, promulgated or adopted by Federal, State or
local authorities.

7.2          Waste.  Lessee shall not commit or suffer to be
committed any waste on the Premises (provided that, the use or application of
pesticides, herbicides, sprays or other materials on the Premises or on any
crops, in accordance with federal, state or county laws and regulations, shall
not constitute waste).  Lessee shall not
maintain any nuisance on the Premises, and shall not use the Premises for any
unlawful purposes.  Lessor and Lessee
acknowledge and agree that any and all deterioration of the Premises due to
salinity, drainage and related problems or the use of the Premises by Lessee in
accordance with normal and customary agricultural practices does not constitute
waste or a nuisance or a breach of any of the terms of this Lease.

 2
 

8.             Use
of Property.  The Premises shall be
used only for planting, caring for, harvesting, and processing (including
freezing and storing) of crops and for other incidental uses.  In so doing, Lessee will comply with all
requirements of law and governmental regulations thereunder.

9.             Department
of Agriculture Rules and Regulations. 
Lessee shall have the use of any contract acres, crop base, yield,
history, allotment and other farm program attributes allocated to the Premises,
and Lessee may farm the same in combination with any other real property of
which Lessee is the owner or operator, provided that such use shall at all
times conform to the rules and regulations of the U.S. Department of
Agriculture (“USDA”).  Lessor
shall execute such documents as may be necessary in order to combine the
Premises with such other property into a single farm unit for USDA
purposes.  Lessor disclaims all
representations and warranties as to the contract acres, crop base, yield,
history, allotment and other farm program attributes allocated to the
Premises.  The parties agree and
understand that at the expiration of the Lease Term, all of the contract acres,
crop base, yield, history, allotment and other farm program attributes allocated
to the Premises as of the inception of this Lease shall revert to Lessor.

10.          Environmental
Indemnity and Covenants.

10.1        Lessor’s
Representations and Warranties. 
Lessor represents and warrants, to the best of its knowledge, that any
handling, transportation, storage, treatment or usage of Hazardous Substances
(as defined in Section 10.6 below) that has occurred on the
Premises during the period of its ownership has been in compliance with all
Environmental and Safety Requirements (as defined in Section 10.5
below).  Lessor further represents and
warrants that, to the best of its knowledge and belief and except as otherwise
disclosed to Lessee in writing, any currently known Hazardous Substances which
might be present above, on, or beneath the Premises do not exceed those
concentrations which would violate current applicable laws and regulations.

10.2        Lessor’s
Indemnity of Lessee.  Lessor hereby
agrees to indemnify and hold harmless Lessee from and against, any and all
losses, costs, claims, or damages to the Premises or suffered by Lessee
resulting from use, generation, manufacture, production, storage, release,
discharge, or disposal of Hazardous Substances on, under, or about the Premises
which are caused by Lessor or occurred prior to the commencement of this
Lease.  Further, Lessor assumes all
liabilities for any clean-up, remediation, and/or restoration costs which
result from such use, generation, manufacture, production, storage, release,
discharge, or disposal of Hazardous Substances which are caused by Lessor or
occurred prior to the commencement of this Lease.

10.3        Lessee’s
Indemnity of Lessor.  Lessee hereby
agrees to indemnify and hold harmless Lessor from and against, any and all
losses, costs, claims, or damages to the Premises or suffered by Lessor
resulting from use, generation, manufacture, production, storage, release,
discharge, or disposal of Hazardous Substances on, under, or about the Premises
which are caused by Lessee or occur during the Lease Term, other than caused by
Lessor.  Further, Lessee assumes all
liabilities for any clean-up, remediation, and/or restoration costs which
result from such use, generation, manufacture, production, storage, release,
discharge, or disposal of

 3
 

Hazardous Substances
which are caused by Lessee or occur during the Lease Term, other than caused by
Lessor.

10.4        Covenants
Regarding Use.  Lessee covenants that
during the Lease Term it will not use, generate, manufacture, produce, store,
release, discharge, or dispose of on, under or about the Premises or transport
to or from the Premises any Hazardous Substances except:  (i) petroleum, gasoline or diesel fuel,
propane or natural gas used to operate motor vehicles or farm machinery or
equipment; and (ii) Hazardous Substances used in the production of
agricultural crops on the Premises or activities related thereto, which are
commonly used for such purposes in the vicinity of the Premises, and which are
used in compliance with applicable laws.

10.5        “Environmental
and Safety Requirements” Defined.  “Environmental
and Safety Requirements” means all federal, state, local and foreign
statutes, regulations, ordinances and other provisions having the force or
effect of law, all judicial and administrative orders and determinations, all
contractual obligations and all common law, in each case concerning public
health and safety, worker health and safety and pollution or protection of the
environment, including all those relating to the presence, use, production,
generation, handling, transport, treatment, storage, disposal, distribution,
labeling, testing, processing, discharge, Release (as “Release” is
defined in the Comprehensive Environmental Response, Compensation and Liability
Act of 1980, as amended from time to time), threatened Release, control or
cleanup of any hazardous or otherwise regulated materials, substances or
wastes, chemical substances or mixtures, pesticides, pollutants, contaminants,
toxic chemicals, petroleum products or byproducts, asbestos, polychlorinated
biphenyls, noise, odor or radiation, as the foregoing are enacted and in effect
on the Closing Date.

10.6        “Hazardous
Substances” Defined.  The term “Hazardous
Substances” means any substance or material that is considered, described,
characterized or listed as a toxic or hazardous substance, waste or material,
or a pollutant, or a contaminant or an infectious waste, or words of similar
import, in or under any applicable Environmental and Safety Requirements, or
chemicals, substances, materials or compounds that are otherwise subject to
regulation, prohibition, control or remediation under or that give rise to
liability under, any applicable Environmental and Safety Requirements, and
includes asbestos, petroleum and petroleum products, methyl tertiary-butyl
ether, polychlorinated biphenyls, urea formaldehyde, radon gas and radioactive
matter.

11.          Concerning
the Premises.  Lessor represents and
warrants to Lessee that it is the sole and lawful record and beneficial owner
of the Premises and that it has the full authority to enter into this Lease and
perform as herein contemplated.  Lessor
warrants quiet possession of the Premises in Lessee during the Lease Term.  In the event Lessee defaults under any lien,
encumbrance, agreement for sale, mortgage or deed of trust against the Premises
which may jeopardize Lessee’s leasehold estate, Lessee may, but is not required
to, pay amounts then due under such lien, encumbrance, agreement for sale,
mortgage or deed of trust and offset such payment against the rent coming due
hereunder.

 4
 

12.          Indemnity
and Insurance.

12.1        Indemnity
of Lessor.  Except as otherwise
provided in this Lease, Lessee shall indemnify, defend, and hold Lessor, Lessor’s
employees and agents, and Lessor’s property harmless from and against all
claims, losses, damages, liabilities and expenses (including attorneys’ fees)
arising from personal injury or physical damage to any person or property
occurring on the Premises and caused by Lessee, Lessee’s employees, agents or
representatives, or due to Lessee’s operations on the Premises during the Lease
Term.  The obligation of Lessee to
indemnify, defend, and hold harmless Lessor, however, shall not apply to, and
Lessee shall not be liable for, claims, losses, damages, liabilities and
expenses as and to the extent the same arise from or relate to (i) the
negligence or willful misconduct of Lessor or Lessor’s employees, agents or
representatives, or (ii) any condition on, of or affecting the Premises on
or prior to the Effective Date.

12.2        Indemnity
of Lessee.  Lessor shall indemnify,
defend and hold Lessee harmless from all claims, losses, damages, liabilities
and expenses (including attorneys’ fees) arising from or relating to
(i) the negligence or willful misconduct of Lessor or Lessor’s employees,
agents or representatives, or (ii) any condition on, of or affecting the
Premises prior to the Effective Date.

12.3        Insurance.  Lessee shall, at Lessee’s sole expense, keep
and maintain in full force during the term hereof, (a) worker’s
compensation insurance, unless Lessee has no employees, (b) a general liability
insurance policy (covering both bodily injury and property damage) in an amount
not less than One Million Dollars ($1,000,000.00) for injury or death of one
person, in an amount not less than Five Million and No/100 Dollars
($5,000,000.00) for injury or death of more than one person in any one accident
or occurrence, and property damage insurance in an amount not less than Two
Million and No/100 Dollars ($2,000,000.00). 
Lessee shall also maintain property insurance for no less than the
replacement cost of the equipment and structures on the Premises and designate
Lessor as loss payee.  Said policies
shall name Lessor as additional insured and shall provide that policy will not
be cancelled or reduced in coverage without ten (10) days’ written notice to
Lessor.

13.          Farming
Practices.  Lessee agrees to use the
commercially reasonable practices and measures to prevent the entry or growth
of Johnson grass, morning glory, Bermuda grass, knapweed and other noxious
weeds or grasses upon the Premises, including necessary control measures on
adjacent or adjoining public and private roads, ditches, banks, fence lines,
lanes and ways.  It shall be the
responsibility of the Lessee to maintain clear vehicular access to and around
all water distribution and drainage collection facilities.  It shall be the obligation of Lessee to bear
the expense of compliance with all lawful requirements governing extermination
and destruction of noxious growth, rodents and harmful insects and protection
against orchard and plant infection on the Premises and adjacent property.

14.          Improvements
and Mechanic’s Liens.  Except for
maintenance required pursuant to Section 15 of this Lease, Lessee
shall not construct, alter or repair structures of any character upon the
Premises without first obtaining the written consent of Lessor, which consent
shall not be unreasonably withheld or delayed. 
Lessee shall pay for all materials joined or affixed to the Premises,
and pay in full all persons that perform labor upon Premises at Lessee’s

 5
 

instance or request.  Lessee shall not permit or suffer any
mechanic’s, materialmen’s or other liens of any kind or nature to be enforced
against the Premises for any work done, or materials furnished thereon, at
Lessee’s instance or request.  Lessee
agrees to indemnify, defend and hold Lessor harmless against any and all such
liens.  Lessor shall have the right to
pay any amount required to release any such lien or liens, or to defend any
action brought thereon, and to pay any judgment entered therein.  Lessee shall be liable to Lessor for all
costs, damages and reasonable attorneys’ fees and any amounts expended in
defending any proceedings, or in the payment of any of said liens or any
judgment obtained therefor.  Lessor may
post and maintain upon the Premises notice of non-responsibility as provided by
law.

15.          Repairs
and Upkeep.  Lessee, at Lessee’s
expense, shall keep in good condition and repair all buildings, fences, wells,
pumping plants, and irrigation systems or other improvements now located upon
the Premises, whether the property of Lessor or Lessee.  Upon the termination of this Lease, Lessee
shall leave the same in as good repair as they now are, damage by the elements,
acts of God and ordinary wear and tear excepted.  Lessor shall not be called upon or required
to make any repairs or incur any expenses of any kind or nature, upon or in
connection with the Premises or improvements, for and during the Lease Term.

16.          Right
of First Offer.

16.1        In
the event that Lessor desires to sell the Property or a portion thereof during
the term of this Lease, Lessor shall notify Lessee in writing of such desire,
and shall designate in writing the purchased price, down payment, interest
rate, closing date, and other material terms of the purchase which Lessor is willing
to accept.

16.2        Within
thirty (30) days after the Lessor’s notice provided under Section 16.1,
Lessee shall notify the Lessor in writing either (i) that Lessee desires
to purchase the Property from the Lessor, or (ii) that Lessee does not
desire to purchase the Property.  If
Lessee elects to purchase the Property, then the parties will execute a
purchase and sale agreement for the Property within thirty (30) days of Lessee’s
notice to the Lessor of desire to purchase the Property.  If Lessee does not elect to purchase the
Property from the Lessor, then the Lessor shall, within one (1) year
thereafter, have the right to sell, convey, trade, or exchange the Property to
a third party on terms that are the same or more favorable to the Lessor than
the Lessor’s original terms as set forth in Lessor’s notification to Lessee,
which sale, conveyance, trade or exchange of the Property shall be subject to
all the terms and conditions of this Lease, except for Lessee’s right of first
offer under this Section 16 which shall be thereafter be extinguished.

16.3        For
the purposes of this Section 16, a higher purchase price shall be
considered more favorable to the Lessor than a lower purchase price, a higher
down payment more favorable than a lower down payment, and a higher interest
rate (in the event of seller financing) more favorable than a lower interest
rate.  If the Lessor does not sell,
convey, trade, exchange, or otherwise dispose of the Property within the period
specified in Section 16.2, or if the Lessor desires to sell,
convey, trade, or exchange the Property at a price, down payment, interest
rate, and other material terms less favorable to the Lessor than those terms as
set forth in the initial notice to Lessee, the Lessor shall first resubmit the
Property or portion thereof to Lessee pursuant to the provisions of this
Section.

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16.4        Any
sale of the Property by Lessor during the term of the Lease shall be subject to
all the terms and conditions of this Lease, including but not limited to Lessee’s
option to purchase a portion of the Property as set forth in Section 37
and, unless Lessee’s right of first offer has been extinguished under
Section 16.2 above or Section 37.8 below, Lessee’s right of first
offer to purchase the Property as set forth in this Section 16.

17.          Subleasing
and Assigning.  Lessee shall have no
right to assign this Lease or sublease the Premises, or portions thereof,
without the prior written consent of Lessor. 
A consent by Lessor to one assignment, subletting, occupation or use by
another person shall not exhaust any covenant against assigning or subletting,
but the same shall remain in full force and effect notwithstanding one or more
consents, or be deemed to be a consent to any subsequent assignment,
subletting, occupation or use by another person.  Any encumbrance, assignment, transfer or
subletting without the prior written consent of Lessor, whether it be voluntary
or involuntary, by operation of law or otherwise, is void and shall, at the
option of Lessor, terminate this Lease. 
The consent of Lessor to any such assignment of Lessee’s interest in
this Lease or the subletting by Lessee on the Premises shall not unreasonably
be withheld.

18.          Surrender
of Premises.  Immediately upon the
expiration or earlier termination of this Lease, Lessee shall surrender
possession of the Premises to the then current owner of the Premises, excepting
that Lessee shall be permitted to care for, harvest and remove any crops then
growing on the Premises.

19.          Lessee’s
Bankruptcy.  If Lessee is adjudicated
as bankrupt, or shall make an assignment for the benefit of creditors, or file
a voluntary petition under any law (having for its purpose the adjudication of
Lessee as bankrupt, or the extension of time of payment, composition,
adjustment, modification, settlement or satisfaction of the liabilities of
Lessee), or receiver be appointed for the property of Lessee by reason of the
insolvency of Lessee, notwithstanding anything to the contrary elsewhere in
this Lease, Lessor shall have the immediate right to terminate this Lease and
to take exclusive possession of the Premises. 
The acceptance of rent or other payment for the use of the Premises
shall not constitute a waiver of Lessor’s right to terminate this Lease as
above set forth.

20.          Lessor’s
Right of Entry.  Lessor and its
agents or representative shall have the right, upon notice and during
reasonable business hours, to enter upon the Premises, to inspect the same or
any crops growing or harvested thereon or being removed therefrom, the
improvements therein, appurtenances thereto, and all equipment located
thereon.  Lessor shall also have the
right to enter the Premises to exercise, protect or defend any of the rights
reserved to Lessor hereunder.

21.          No
Warranty.  Lessee expressly
acknowledges that Lessor has made no warranty in this Lease and no warranty
shall be implied by reason of any term or provision of this Lease concerning
the availability or sufficiency of water or any other utility for use upon the
Premises; nor has Lessor made any warranty in this Lease concerning the
sufficiency of wells, pumping plants, canals, pipelines or any other irrigation
equipment for provision of water to the crops, any dwellings or machinery upon
the Premises; nor has Lessor made any warranty in this Lease concerning the
sufficiency of any provisions for the control of flooding of the Premises, nor
has

 7
 

Lessor made any warranty
in this Lease concerning the sufficiency of adequacy of the Premises for the
use or uses intended by Lessee.

22.          Holding
Over.  Any holding over after the
Lease Term with the consent of Lessor expressed or implied shall not extend the
Lease Term or renew this Lease, regardless of the period of holding over.  Any such holding over shall constitute a
tenancy from month to month upon each and every term, condition and covenant of
this Lease insofar as the same may be applicable, excepting that the rental
reserved shall be at the rate of one hundred and fifty percent (150%) of the
immediately prior monthly rental rate.

23.          Condemnation.  In the event the Premises or any part thereof
are taken or sold under threat of condemnation, the rental shall be reduced pro
rata to the Premises and improvements for the taking thereof, and shall be
payable to Lessor, and Lessee does sell, assign, transfer and set over any
interest Lessee might otherwise have in and to such compensation to
Lessor.  Lessee shall, nevertheless, be
entitled to any compensation for damages paid with respect to unharvested
growing crops resulting from such condemnation.

24.          Default.  The failure by Lessee to observe or perform
any covenant, condition or provision of this Lease to be observed or performed
by Lessee, where such failure continues for a period of thirty (30) days after
written notice from Lessor to Lessee shall constitute a default under this
Lease by Lessee.  Notwithstanding the
foregoing, Lessor shall not terminate this Lease or disturb or terminate Lessee’s
possession unless such default continues for an additional fifteen (15) days
after Lessee’s receipt of a second notice of such failure.  Such second notice must (a) be given at
least thirty (30) days after the first notice, (b) must state in bold type
that it is a second notice, (c) must state in bold type that the Lease may
be terminated or that Lessee’s right of occupancy may be terminated if such
failure is not cured within fifteen (15) days, and (d) must specify the
nature of the default and the cure demanded. 
If such failure continues after such second notice, Lessor shall have
the right to take possession Premises or relet the Premises.

25.          Waiver
and Modification.  This Lease may be
amended or supplemented only by a written instrument signed by the parties
hereto.

26.          Severability.  In the event any provision of this Lease
shall be held by any court of competent jurisdiction to be illegal, invalid or
unenforceable for any reason, the remaining provisions of this Lease shall
nonetheless remain in full force and effect.

27.          Construction
of Lease.  The paragraph headings in
this Lease have been inserted for convenience only, and shall not be considered
or referred to in resolving questions of interpretation or construction.  In determining the meaning of, or resolving
any ambiguity with respect to, any provision of this Lease, such provision
shall be interpreted without construing such provision in favor of or against
the party responsible for drafting this document.

28.          Further
Assurances.  Lessee and Lessor shall,
at their own expense, execute, acknowledge and deliver all instruments and
documents and take all actions as may reasonably be required in order to carry
out the intent of, and the transactions contemplated by, this Lease.

 8
 

29.          Attorneys’
Fees.  In any action or proceeding by
either party to enforce this Lease or any provisions thereof, the prevailing
party shall be entitled to all costs and reasonable attorneys’ fees.

30.          Notices.  Any notice to be given to either party by the
other shall be in writing and deemed served on the date of delivery if hand
delivered to the person to whom notice is to be given, and on the third (3rd)
day after mailing if sent by certified mail, with postage prepaid and return
receipt requested, and addressed as follows:

	
  Notices to Lessor:

  	
   

  	
  with a copy to:

  
	
   

  	
   

  	
   

  
	
  Rader Farms, Inc.

  1270 East Badger Road

  Lynden, Washington 98264

  Attn: Lyle Rader

  Fax: (360) 354-7070

  	
   

  	
  Hillis Clark Martin & Peterson, P.S.

  1221 Second Avenue, Suite 500

  Seattle, Washington 98101

  Attn: Gabriel S. Rosenthal

  Fax: (206) 623-7789

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Notices to Lessee:

  	
   

  	
  with a copy to:

  
	
   

  	
   

  	
   

  
	
  Rader Farms Acquisition Corp.

  c/o The Inventure Group, Inc.

  5050 North 40th Street, Suite 300

  Phoenix, Arizona 85018

  Attention: Steve Weinberger

  Fax: (602) 522-2690

  	
   

  	
  Osborn Maledon, PA

  2929 North Central Ave., 21st Floor

  Phoenix, Arizona 85012

  Attention: Christopher S. Stachowiak

  Fax: (602) 664-2055

  

 

31.          Binding
Effect.  The provisions of this Lease
shall benefit and bind the heirs, successors, executors, administrators and
assigns of all parties to this Lease.

32.          Time.  Time is of the essence of this Lease.

33.          Entire
Agreement.  This Lease constitutes
the entire agreement between the parties pertaining to the lease of the
Premises, and supersedes all prior and contemporaneous agreements,
representations, and understandings of the parties with regard thereto.  No supplement, modification or amendment of
this Lease shall be binding unless executed in writing by all of the parties
hereto.

34.          Relationship
Limited.  It is expressly understood
and agreed that the relationship of Lessor and Lessee is one of Lessor and
Lessee and not one of partnership or joint venture, and that Lessor shall not
become responsible for any debt or obligation contracted or incurred by Lessee
nor shall Lessee become responsible for any debt or obligation contracted or
incurred by Lessor.

35.          Authority.  Each party represents and warrants to the
other that (i) such party has the requisite legal capacity and authority
to enter into and fully perform each and all of their

 9
 

obligations under this
Lease and (ii) this Lease does not in any way violate any covenant,
contract, agreement, instrument or understanding by which such party is bound.

36.          Recordation.  The parties agree that Lessee may, during the
Lease Term, record a memorandum of this Lease, subject to Lessor’s prior approval
of any such memorandum.

37.          Option
to Purchase.  Lessor hereby grants to
Lessee an option to purchase either (a) that portion of the Premises on
which the processing plant is currently located as described on Exhibit ”B”
(the “Building Land”), or (b) the Property, on the terms and
conditions set forth in this Section 37.

37.1        Exercise.  The option may be exercised by written notice
to Lessor no earlier than one hundred eighty (180) days and no later than
ninety (90) days prior to the expiration of the Term of this Lease.

37.2        Price.  The purchase price shall be the fair market
value of the Building Land or the Property, depending on which Lessee elects to
purchase, as land only and without considering the value of any buildings or
other improvements.  The purchase price
shall be paid in cash at close of escrow. 
If the parties cannot agree upon the value of the land within thirty
(30) days after Lessee shall have exercised the option, the parties shall
appoint an arbitrator to establish the value of the land.  If the parties cannot agree upon an
arbitrator, the then presiding judge of Whatcom County Superior Court shall
appoint the arbitrator.  The arbitrator
must be a licensed appraiser with at least five years experience valuing land
in the general area of the Property.  The
decision of the arbitrator shall be final. 
Lessor and Lessee shall split the arbitrator’s fees.

37.3        Closing.  The closing shall occur on the date this
Lease expires, or such earlier date as the parties shall agree.

37.4        Escrow
Agent.  Closing shall occur at Chicago
Title Insurance Company located at 1616 Cornwall Avenue, Suite 115, Bellingham,
Washington 98225.

37.5        Title.  Marketable fee title shall be conveyed to
Lessee by general warranty deed subject only to those matters to which the
Building Land or Property was subject as of the date of this Lease, and shall
be insured by a standard owner’s policy of title insurance subject only to said
matters and the usual exceptions and exclusions in such form of policy.

37.6        Closing
Costs.  Escrow fees shall be split
equally between Lessor and Lessee, Lessor shall pay the cost of the owners
policy of title insurance, and all other closing costs and prorations shall
follow prevailing custom.

37.7        Cooperation.  The parties shall take such actions and shall
execute such documents as shall be necessary to close escrow and to carry out
the intent and purpose of this Section 37.

37.8        Failure
to Exercise/Close.  In the event
either (i) Lessor does not exercise the option to purchase set forth in
this Section 37 by providing notice within the time period specified in
Section 37.1 above, or (ii) closing of the option to purchase set
forth in this

 10
 

Section 37 does not
occur within the time period required through no fault of Lessor, then, in
either event, Lessor shall be free to sell or otherwise transfer the property
to any third party or related party and Lessee shall have no further rights
under this Section 37 or Section 16 above.

37.9        Additional
Acreage.  It
is acknowledged that the land described on Exhibit “C”, consisting of
approximately 40 acres, is not currently farmable due to environmental
restrictions.  At such time as the land
or some portion thereof becomes legally farmable, Lessor shall notify Lessee
and such additional farmable acreage shall be added to this Lease upon all the
same terms and conditions, except that the rent hereunder shall be increased by
$750.00 per acre per year for the initial ten years of the term of this Lease
and by $900.00 per acre per year for the second ten years, payable monthly,
commencing upon the delivery of such land to Lessee in a farmable condition.

IN WITNESS
WHEREOF, the parties hereto have executed this lease as of the year and day
first written above.

LESSEE:

RADER FARMS ACQUISITION
CORP.,

a Delaware corporation

	
  By

  	
   

  	
  /s/ Steve Weinberger

  	
   

  	
   

  
	
  Name

  	
   

  	
  Steve Weinberger

  	
   

  	
   

  
	
  Its

  	
   

  	
  CFO/Secretary

  	
   

  	
   

  

 

LESSOR:

	
   /s/ Lyle Rader

  	
   

  	
  /s/ Sue Rader 

  	
   

  
	
  LYLE RADER

  	
   

  	
  SUE RADER

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   /s/ Brad Rader

  	
   

  	
  /s/ Julie Newell

  	
   

  
	
  BRAD RADER

  	
   

  	
  JULIE NEWELL

  
	
   

  	
   

  	
  (fka Julie Rader)

  

 

 11
 

 

	
  STATE OF ARIZONA

  

  COUNTY OF MARICOPA

  	
  }

  	
  

  ss.

  

 

On this day personally appeared before me Steve
Weinberger, to me known to be the CFO/Secretary of RADER FARMS ACQUISITION CORP., the Delaware corporation that
executed the foregoing instrument, and acknowledged such instrument to be the
free and voluntary act and deed of such corporation, for the uses and purposes
therein mentioned, and on oath stated that [he/she] was duly authorized to
execute such instrument.

GIVEN UNDER MY HAND AND
OFFICIAL SEAL this 15th day of May, 2007.

	
  

  	
  /s/ Pamela A. Dahlmeier

  	
   

  
	
   

  	
  Printed Name Pamela A. Dahlmeier

  
	
  [OFFICIAL SEAL]

  	
  NOTARY PUBLIC in and
  for the State of Washington,

  
	
   

  	
  residing at  Phoenix,
  AZ

  
	
   

  	
  My Commission Expires May 11, 2009

  

 

 12
 

 

	
  STATE OF WASHINGTON

  

  COUNTY OF WHATCOM

  	
  }

  	
  

  ss.

  

 

On this day personally
appeared before me LYLE RADER and SUE RADER, to me known to be the individuals
that executed the foregoing instrument, and acknowledged such instrument to
their the free and voluntary act and deed, for the uses and purposes therein
mentioned.

GIVEN
UNDER MY HAND AND OFFICIAL SEAL this 16th day
of May, 2007.

	
  

  	
  /s/ Jolene M. Burdette

  	
   

  
	
  [OFFICIAL SEAL]

  	
  Printed Name Jolene M. Burdette

  
	
   

  	
  NOTARY PUBLIC in and
  for the State of Washington, 

  
	
   

  	
  residing at Whatcom County/Everson

  
	
   

  	
  My Commission Expires March 19, 2010

  

 

 13
 

 

	
   STATE OF
  WASHINGTON

  

  COUNTY OF WHATCOM

  	
  }

  	
  

  ss.

  

 

On this day personally
appeared before me BRAD RADER, to me known to be the individual that executed
the foregoing instrument, and acknowledged such instrument to be his free and
voluntary act and deed, for the uses and purposes therein mentioned.

GIVEN
UNDER MY HAND AND OFFICIAL SEAL this 16th day
of May, 2007.

	
  

  	
  /s/ Jolene M. Burdette

  	
   

  
	
   

  	
  Printed Name Jolene M. Burdette

  
	
  [OFFICIAL SEAL]

  	
  NOTARY PUBLIC in and
  for the State of Washington,

  residing at Whatcom County/Everson

  
	
   

  	
  My Commission Expires March 19, 2010

  

 

 14
 

 

	
   STATE OF
  WASHINGTON

  

  COUNTY OF KING

  	
  }

  	
  

  ss.

  

 

On this day personally appeared before me JULIE NEWELL
(f.k.a. Julie Rader), to me known to be the individual that executed the
foregoing instrument, and acknowledged such instrument to be her free and
voluntary act and deed, for the uses and purposes therein mentioned.

GIVEN UNDER MY HAND AND
OFFICIAL SEAL this 16th day of May, 2007.

	
  

  	
  /s/ Gabriel Rosenthal

  	
   

  
	
  [OFFICIAL SEAL]

  	
  Printed Name Gabriel Rosenthal

  
	
   

  	
  NOTARY PUBLIC in and
  for the State of Washington,

  residing at Seattle, Washington

  
	
   

  	
  My Commission Expires April 19, 2010

  

 

 15
 

GUARANTY

IN CONSIDERATION OF, and
as an inducement for the granting, execution and delivery of that certain
Agricultural Ground Lease, dated May 18th, 2007 (the “Lease”) between Lyle Rader, Sue Rader, Brad Rader and Julie
Newell (formerly known as Julie Rader) (collectively, “Landlord”),
and RADER FARMS ACQUISITION CORP., a  Delaware corporation (“Tenant”), and as a material inducement for Landlord to enter
into the Lease, THE INVENTURE GROUP, INC.,
a Delaware corporation (the “Guarantor”),
hereby guarantees to Landlord, its successors and assigns, the full, prompt and
timely payment of Rent, as defined in the Lease, and any and all other sums and
charges payable by Tenant, its successors and assigns, under the Lease and the
full, prompt and timely performance and observance of all of the covenants,
terms, conditions and agreements therein provided to be performed and observed
by Tenant, its successors and assigns. 
Guarantor hereby covenants and agrees to and with Landlord, its
successors and assigns, that if default shall at any time be made by Tenant,
its successors and assigns, in the payment of any such sums or in the performance
of any of the terms, covenants, provisions or conditions contained in the
Lease, Guarantor shall forthwith pay such sums to Landlord, its successors and
assigns, upon demand and shall forthwith faithfully perform and fulfill all of
such terms, covenants, conditions and provisions, and will forthwith pay to
Landlord all damages that may arise in consequence of any default by the
Tenant, its successors and assigns under the Lease, including, without
limitation, all reasonable attorneys’ fees and costs incurred by Landlord or
caused by any such default and/or by the enforcement of the Lease and this
Guaranty.

This Guaranty is an
absolute and unconditional personal Guaranty of payment and of
performance.  It shall be enforceable
against Guarantor, its heirs, successors and assigns, without the necessity for
any suit or proceedings on Landlord’s part of any kind or nature whatsoever
against Tenant, its successors and assigns, and without the necessity of any
notice of nonpayment, nonperformance or non-observance or of any notice
of acceptance of this Guaranty, or of any other notice or demand to which the
Guarantor might otherwise be entitled, all of which Guarantor hereby expressly
waives.  Guarantor hereby expressly
agrees that the validity of this Guaranty and the obligations of Guarantor
hereunder shall in no way be terminated, affected or impaired by reason of the
assertion or the failure to assert by Landlord against the Tenant, or Tenant’s
successors and assigns, of any of the rights or remedies reserved to Landlord
pursuant to the provisions of the Lease.

The Guaranty shall be a
continuing Guaranty, and the liability of Guarantor hereunder shall in no way
be affected, modified or diminished by reason of any assignment, renewal,
amendment, modification or extension of the Lease or by reason of any
modification, amendment or waiver of or change in any of the terms, covenants,
conditions or provisions of the Lease, or by reason of any extension of time
that may be granted by Landlord to Tenant, its successors or assigns, or by
reason of any dealings or transactions or matter or things occurring between
Landlord and Tenant, its successors or assigns, whether or not notice thereof
is given to Guarantor.  This Guaranty
shall be construed under the provisions of Washington law.

All of Landlord’s rights
and remedies under the Lease or under this Guaranty are intended to be
distinct, separate and cumulative and no such right and remedy therein or
herein mentioned is intended to be in exclusion of or a waiver of any of the
others.

 16
 

EXECUTED as of May
18th,
2007.

	
  

  	
  GUARANTOR:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  THE INVENTURE GROUP, INC.,

  
	
   

  	
  a Delaware corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
  /s/ Steve Weinberger

  	
   

  
	
   

  	
  Name

  	
  Steve Weinberger

  	
   

  
	
   

  	
  Its

  	
  CFO

  	
   

  
							

 

 17
 

EXHIBIT A

PROPERTY
DESCRIPTION

 18

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