Document:

EX 10.2

     

     

    EXHIBIT
      10.2

     

    NOTE
      AND WARRANT PURCHASE AGREEMENT

     

    This
      Note
      and Warrant Purchase Agreement, dated as of June 1, 2008, (this “Agreement”)
      is
      entered into by and among Organic To Go Food Corporation, a Delaware corporation
      (the “Company”),
      and
      W.Health L.P., a limited partnership organized under the laws of the Bahamas
      (the “Investor”).
      

     

    RECITALS

     

    On
      the
      terms and subject to the conditions set forth herein, the Investor is willing
      to
      purchase from the Company, and the Company is willing to sell to the Investor,
      one or more convertible promissory notes in the aggregate principal amount
      of up
      to $10,000,000, together with one or more related warrants to acquire shares
      of
      the Company’s common stock, par value $0.001 per share (the “Common
      Stock”).

     

    AGREEMENT
      

     

    NOW
      THEREFORE, in consideration of the foregoing, and the representations,
      warranties, and conditions set forth below, the parties hereto, intending to
      be
      legally bound, hereby agree as follows:

     

    1. The
      Notes and Warrants.

     

    (a) Issuance
      of Notes.
      At the
      Closings (as defined below), the Company agrees to issue and sell to the
      Investor, and, subject to all of the terms and conditions hereof, the Investor
      agrees to purchase one or more convertible promissory notes in the form of
      Exhibit A
      hereto
      (each, a “Note”
and,
      collectively, the “Notes”)
      in the
      aggregate principal amount of up to $10,000,000. 

     

    2. Procedure.
      The
      initial Closing (the “Initial
      Closing”)
      shall
      occur within seven (7) Business Days (as defined below) following the date
      of
      this Agreement (the “Initial
      Closing Date”),
      upon
      which date the Company shall deliver to the Investor a Note in a principal
      amount of $5,000,000 and a Warrant (as defined below) to purchase 625,000 shares
      of Common Stock, and the Investor shall deliver to the Company the Purchase
      Price (as defined below) of $5,000,000. At any time during the nine months
      following the Initial Closing Date and so long as no Event of Default (as
      defined below) shall have occurred and be continuing and there
      has
      been no event, occurrence or development that has had or that could reasonably
      be expected to result in a Material Adverse Effect (as defined
      below),
      the
      Company shall have the right and option, in its sole discretion, to issue and
      sell a Note to the Investor and, subject to all of the terms and conditions
      hereof, obligate the Investor to purchase such Note, by delivering a written
      notice (the “Notice”)
      to the
      Investor which specifies: (i) a Closing Date (as defined below) within ten
      (10)
      Business Days following the date the Investor

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

     

    receives
      the Notice and (ii) the principal amount of such Note, which shall be at least
      $1,000,000 and shall not, when aggregated with the principal amounts of all
      of
      the Notes previously issued under this Agreement, exceed $10,000,000.
“Business
      Day”
      means
      any day except Saturday, Sunday and any day which is a federal legal holiday
      in
      the United States or in Switzerland, or a day on which banking institutions
      in
      the State of New York are authorized or required by law or other governmental
      action to close. “Event
      of Default”
shall
      mean the occurrence of any of the following: (a) Voluntary
      Bankruptcy or Insolvency Proceedings. The
      Company shall (i) apply for or consent to the appointment of a receiver,
      trustee, liquidator or custodian of itself or of all or a substantial part
      of
      its property, (ii) be unable, or admit in writing its inability, to pay its
      debts generally as they mature, (iii) make a general assignment for the
      benefit of its or any of its creditors, (iv) be dissolved or liquidated,
      (v) become insolvent (as such term may be defined or interpreted under any
      applicable statute), (vi) commence a voluntary case or other proceeding
      seeking liquidation, reorganization or other relief with respect to itself
      or
      its debts under any bankruptcy, insolvency or other similar law now or hereafter
      in effect or consent to any such relief or to the appointment of or taking
      possession of its property by any official in an involuntary case or other
      proceeding commenced against it, or (vii) take any action for the purpose
      of effecting any of the foregoing; or (b) Involuntary
      Bankruptcy or Insolvency Proceedings. Proceedings
      for the appointment of a receiver, trustee, liquidator or custodian of the
      Company or of all or a substantial part of the property thereof, or an
      involuntary case or other proceedings seeking liquidation, reorganization or
      other relief with respect to the Company or the debts thereof under any
      bankruptcy, insolvency or other similar law now or hereafter in effect shall
      be
      commenced and an order for relief entered or such proceeding shall not be
      dismissed or discharged within 60 days of commencement; or (c) Material
      Breach.
      The
      Company shall breach any term of this Agreement, any of the Transaction
      Documents or any other agreement or instrument executed in connection therewith,
      which, individually or in the aggregate, materially and adversely affects any
      of
      the Investor’s rights under this Agreement or any of the Transaction Documents,
and
      as
      to any
      breach that is capable of cure, the Company fails to cure such breach within
      fifteen (15) days after the Investor provides written notice to the Company
      of
      such breach. 

     

    (a) Issuance
      of Warrants. In
      consideration for the purchase by the Investor of each Note, the Company will
      issue to the Investor one five (5) year warrant in the form attached hereto
      as
Exhibit B
      (each, a
“Warrant”
and,
      collectively, the “Warrants”)
      to
      purchase, at an exercise price of $3.00 per share, such number of shares of
      Common Stock as determined by dividing the principal amount of such Note by
      $10,000,000 and multiplying such amount by 1,250,000 shares of Common Stock;
      provided that the number of shares of Common Stock subject to each Warrant
      and
      the exercise price of each Warrant shall be subject to adjustment in accordance
      with Section 9 of the form of Warrant attached hereto as Exhibit
      B. For
      example, for a Note with a principal amount of $5,000,000, the Company shall
      issue to the Investor a Warrant to purchase 625,000 shares of Common Stock
      calculated as follows:

     

    
      
        	
                Investment
                  amount

              	 	
                $

              	
                5,000,000

              	 
	
                Divided
                  by $10MM

              	 	
                $

              	
                10,000,000

              	 
	
                Percent
                  of total maximum investment

              	 	 	
                50

              	
                %

              
	
                Multiplied
                  by total warrants for $10MM

              	 	 	
                1,250,000

              	 
	
                Warrants
                  issued for $5MM investment

              	 	 	
                625,000

              	 

      

    

     

     

    
      
         

      

      
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    (b) 
      Delivery.
      The
      sale and purchase of each Note and Warrant shall take place at a closing (the
      “Closing”).
      Each
      Closing, other than the Initial Closing, shall be held on the date specified
      in
      the Notice, which shall be a Business Day (the “Closing
      Date”).
      At
      each Closing, the Company will deliver to the Investor the Note and Warrant
      to
      be purchased by the Investor, against receipt by the Company of the
      corresponding purchase price which shall be equal to the principal amount of
      such Note (the “Purchase
      Price”),
      in
      United States dollars and in immediately available funds, by wire transfer
      to an
      account designated in writing by the Company. Each Note and Warrant will be
      registered in the Investor’s name in the Company’s records. 

     

     

    (c) Use
      of Proceeds.
      The
      proceeds of the sale and issuance of the Notes shall be used solely to fund
      acquisitions by the Company and for general working capital approved by the
      Company’s Board of Directors.

     

    3. Representations
      and Warranties of the Company.
      The
      Company hereby makes the following representations and warranties to the
      Investor:

     

    (a) Subsidiaries.
      The
      Company has no direct or indirect Subsidiaries (as defined below) other than
      as
      specified in all reports required to be filed by it under the Securities Act
      of
      1933, as amended (the “Securities
      Act”),
      and
      the Securities Exchange Act of 1934, as amended (the “Exchange
      Act”),
      including pursuant to Section 13(a) or 15(d) thereof, for the twelve months
      preceding the date hereof (or such shorter period as the Company was required
      by
      law to file such reports) (the foregoing materials being collectively referred
      to herein as the “SEC
      Reports”).
      Except
      as disclosed in Schedule
      2(a),
      the
      Company owns, directly or indirectly, all of the capital stock of each
      Subsidiary free and clear of any and all Liens (as defined below), and all
      the
      issued and outstanding shares of capital stock of each Subsidiary are validly
      issued and are fully paid, non-assessable and free of preemptive and similar
      rights. “Lien”
      means
      any lien, charge, encumbrance, security interest, right of first refusal or
      other restrictions of any kind. “Subsidiary”
      means
      any “significant subsidiary” as defined in Rule 1-02(w) of the Regulation S-X
      promulgated by the Commission under the Exchange Act.

     

    (b) Organization
      and Qualification.
      The
      Company and each Subsidiary are duly incorporated or otherwise organized,
      validly existing and in good standing under the laws of the jurisdiction of
      its
      incorporation or organization (as applicable), with the requisite power and
      authority to own and use its properties and assets and to carry on its business
      as currently conducted. Neither the Company nor any Subsidiary is in violation
      of any of the provisions of its respective certificate or articles of
      incorporation, bylaws or other organizational or charter documents. The Company
      and each Subsidiary are duly qualified to conduct its respective businesses
      and
      are in good standing as a foreign corporation or other entity in each
      jurisdiction in which the nature of the business conducted or property owned
      by
      it makes such qualification necessary, except where the failure to be so
      qualified or in good standing, as the case may be, could not, individually
      or in
      the aggregate, have or reasonably be expected to result in a Material Adverse
      Effect. “Material
      Adverse Effect”
      means
      any of (i) a material and adverse effect on the legality, validity or
      enforceability of any Transaction Document, (ii) a material and adverse effect
      on the results of operations, assets, prospects, business or condition
      (financial or otherwise) of the Company and the

    
      
         

      

      
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    Subsidiaries,
      taken as a whole, or (iii) an adverse impairment to the Company’s ability to
      perform on a timely basis its obligations under any Transaction Document (as
      defined below).

     

    (c) Authorization;
      Enforcement.
      The
      Company has the requisite corporate power and authority to enter into and to
      consummate the transactions contemplated by each of the Transaction Documents
      and otherwise to carry out its obligations thereunder. The execution and
      delivery of each of the Transaction Documents by the Company and the
      consummation by it of the transactions contemplated thereby have been duly
      authorized by all necessary action on the part of the Company and no further
      action is required by the Company in connection therewith. Each Transaction
      Document has been (or upon delivery will have been) duly executed by the Company
      and, when delivered in accordance with the terms hereof, will constitute the
      valid and binding obligation of the Company enforceable against the Company
      in
      accordance with its terms, except as such enforceability may be limited by
      applicable bankruptcy, insolvency, reorganization, moratorium, liquidation
      or
      similar laws relating to, or affecting generally the enforcement of, creditors’
rights and remedies or by other equitable principles of general
      application.

     

    (d) No
      Conflicts.
      The
      execution, delivery and performance of the Transaction Documents by the Company
      and the consummation by the Company of the transactions contemplated thereby
      do
      not and will not (i) conflict with or violate any provision of the Company’s or
      any Subsidiary’s certificate or articles of incorporation, bylaws or other
      organizational or charter documents, or (ii) conflict with, or constitute a
      default (or an event that with notice or lapse of time or both would become
      a
      default) under, or give to others any rights of termination, amendment,
      acceleration or cancellation (with or without notice, lapse of time or both)
      of,
      any agreement, credit facility, debt or other instrument (evidencing a Company
      or Subsidiary debt or otherwise) or other understanding to which the Company
      or
      any Subsidiary is a party or by which any property or asset of the Company
      or
      any Subsidiary is bound or affected, or (iii) result in a violation of any
      law,
      rule, regulation, order, judgment, injunction, decree or other restriction
      of
      any court or governmental authority to which the Company or a Subsidiary is
      subject (including federal and state securities laws and regulations), or by
      which any property or asset of the Company or a Subsidiary is bound or affected;
      except in the case of each of clauses (ii) and (iii), such as could not,
      individually or in the aggregate, have or reasonably be expected to result
      in a
      Material Adverse Effect. 

     

    (e) Filings,
      Consents and Approvals.
      Neither
      the Company nor any Subsidiary is required to obtain any consent, waiver,
      authorization or order of, give any notice to, or make any filing or
      registration with, any court or other federal, state, local or other
      governmental authority or other Person in connection with the execution,
      delivery and performance by the Company of the Transaction Documents, other
      than
      (i) the filing with the Securities and Exchange Commission (the “SEC”)
      of one
      or more registration statements in accordance with the requirements of the
      Note
      Registration Rights Agreement (as defined below) and the Warrant Registration
      Rights Agreement (as defined below), (ii) filings required by state securities
      laws, (iii) filings required in accordance with Section 5(f) and (iv) those
      that
      have been made or obtained prior to the date of this Agreement.

     

    (f) Issuance
      of the Securities.
      The
      Securities (as defined below) have been duly authorized and, when issued and
      paid for in accordance with the Transaction Documents, will be

    
      
         

      

      
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    duly
      and
      validly issued, fully paid and nonassessable, free and clear of all Liens.
      The
      Company has reserved from its duly authorized capital stock the shares of Common
      Stock issuable upon conversion of the Notes or the exercise of the Warrants.
      “Securities”
      means
      the
      Notes, the Warrants, the shares of Common Stock issuable upon conversion of
      the
      Notes and the shares of Common Stock issuable upon exercise of the
      Warrants.

     

    (g) Capitalization.
      The
      number of shares and type of all authorized, issued and outstanding capital
      stock of the Company, and all shares of Common Stock reserved for issuance
      under
      the Company’s various option and incentive plans, is specified in the SEC
      Reports. Except as specified in the SEC Reports and as disclosed in Schedule
      2(g),
      no
      securities of the Company are entitled to preemptive or similar rights, and
      no
      Person (as defined below) has any right of first refusal, preemptive right,
      right of participation, or any similar right to participate in the transactions
      contemplated by the Transaction Documents. Except as specified in the SEC
      Reports
      and
      except as set forth on Schedule
      2(g),
      there
      are no outstanding options, warrants, scrip rights to subscribe to, calls or
      commitments of any character whatsoever relating to, or securities, rights
      or
      obligations convertible into or exchangeable for, or giving any Person any
      right
      to subscribe for or acquire, any shares of Common Stock, or contracts,
      commitments, understandings or arrangements by which the Company or any
      Subsidiary is or may become bound to issue additional shares of Common Stock,
      or
      securities or rights convertible or exchangeable into shares of Common Stock.
      Except
      with respect to 2,229,430 warrants to purchase Common Stock, the
      issue
      and sale of the Securities will not, immediately or with the passage of time,
      obligate the Company or any Subsidiary to issue shares of Common Stock or other
      securities to any Person (other than the Investor) and will not result in a
      right of any holder of Company or Subsidiary securities to adjust the exercise,
      conversion, exchange or reset price under such securities. “Person”
      means an
      individual or corporation, partnership, trust, incorporated or unincorporated
      association, joint venture, limited liability company, joint stock company,
      government (or an agency or subdivision thereof) or other entity of any
      kind.

     

    (h) SEC
      Reports; Financial Statements.
      Except
      as
      set forth on Schedule
      2(h),
      the
      Company
      has filed all SEC Reports required to be filed by it on a timely basis or has
      timely filed a valid extension of such time of filing and has filed any such
      SEC
      Reports prior to the expiration of any such extension. As of their respective
      dates, the SEC Reports complied in all material respects with the requirements
      of the Securities Act and the Exchange Act and the rules and regulations of
      the
      SEC promulgated thereunder, and none of the SEC Reports, when filed, contained
      any untrue statement of a material fact or omitted to state a material fact
      required to be stated therein or necessary in order to make the statements
      therein, in light of the circumstances under which they were made, not
      misleading. Since February 13, 2007, the Company has not received any material
      correspondence from the SEC or any Trading Market (as defined below) concerning
      the SEC Reports. The financial statements of the Company and any Subsidiary
      included in the SEC Reports comply in all material respects with applicable
      accounting requirements and the rules and regulations of the Commission with
      respect thereto as in effect at the time of filing. Such financial statements
      have been prepared in accordance with U.S. generally accepted accounting
      principles (“GAAP”)
      applied
      on a consistent basis during the periods involved, except as may be otherwise
      specified in such financial statements or the notes thereto, and fairly present
      in all material respects the financial position of the Company and its
      consolidated Subsidiaries as of and for the dates thereof and the results of
      operations and cash flows for the periods then ended, subject, in the case
      of

    
      
         

      

      
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    unaudited
      statements, to normal, immaterial, year-end audit adjustments. “Trading
      Market”
      means
      whichever of the New York Stock Exchange, the American Stock Exchange, the
      NASDAQ Global Select Market, the NASDAQ Global Market, the NASDAQ Capital Market
      or OTC Bulletin Board on which the Common Stock is listed or quoted for trading
      on the date in question.

     

    (i) Press
      Releases.
      The
      press releases
      disseminated by the Company since February
      13, 2007
      taken as
      a whole do not contain any untrue statement of a material fact or omit to state
      a material fact required to be stated therein or necessary in order to make
      the
      statements therein, in light of the circumstances under which they were made
      and
      when made, not misleading.

     

    (j) Material
      Changes.
      Since
      the
      date of the latest audited financial statements included within the SEC Reports,
      except as specifically
      disclosed in the SEC Reports and
      except as disclosed on Schedule
      2(j),
      (i)
      there has been no event, occurrence or development that has had or that could
      reasonably be expected to result in a Material Adverse Effect, (ii) neither
      the
      Company nor any Subsidiary has entered into any material contract, agreement
      or
      other transaction that is not in the ordinary course of business, (iii) neither
      the Company nor any Subsidiary has incurred any liabilities or obligations
      (contingent or otherwise) other than (A) trade payables, accrued expenses and
      other liabilities incurred in the ordinary course of business consistent with
      past practice, (B) liabilities not required to be reflected in the Company’s
      financial statements pursuant to GAAP or required to be disclosed in filings
      made with the SEC, and (C) liabilities not exceeding in the aggregate $200,000;
      (iv) neither the Company nor any Subsidiary has altered its method of accounting
      or the identity of its auditors, (v) neither the Company nor any Subsidiary
      has
      declared or made any dividend or distribution of cash or other property to
      its
      stockholders or purchased, redeemed or made any agreements to purchase or redeem
      any shares of its capital stock, and (vi) neither the Company nor any Subsidiary
      has issued any equity securities to any officer, director or Affiliate (as
      defined below), except pursuant to existing stock option plans. The Company
      does
      not have pending before the Commission any request for confidential treatment
      of
      information. “Affiliate”
      means
      any Person that, directly or indirectly through one or more intermediaries,
      controls or is controlled by or is under common control with a Person, as such
      terms are used in and construed under Rule 144.

     

    (k) Litigation.
      Except
      as set forth on Schedule
      2(k),
      there
      is no Action (as defined below) which (i) adversely affects or challenges the
      legality, validity or enforceability of any of the Transaction Documents or
      the
      Securities or (ii) except as specifically disclosed in the SEC Reports, could,
      if there were an unfavorable decision, individually or in the aggregate, have
      or
      reasonably be expected to result in a Material Adverse Effect. Neither the
      Company nor any Subsidiary, nor any director or officer thereof (in his or
      her
      capacity as such), is or has been the subject of any Action involving a claim
      of
      violation of or liability under federal or state securities laws or a claim
      of
      breach of fiduciary duty, except as specifically disclosed in the SEC Reports.
      There has not been, and to the knowledge of the Company, there is not pending
      any investigation by the SEC involving the Company, any Subsidiary or any
      current or former director or officer of the Company (in his or her capacity
      as
      such). The SEC has not issued any stop order or other order suspending the
      effectiveness of any registration statement filed by the Company or any
      Subsidiary under the Exchange Act or the Securities Act. “Action”
      means
      any action, suit, inquiry, notice of violation, proceeding
      (including

    
      
         

      

      
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    any
      partial proceeding such as a deposition) or investigation pending or threatened
      in writing against or affecting the Company, any Subsidiary or any of their
      respective properties before or by any court, arbitrator, governmental or
      administrative agency, regulatory authority (federal, state, county, local
      or
      foreign), stock market, stock exchange or trading facility.

     

    (l) Labor
      Relations.
      Except
      as set forth on Schedule
      2(l),
      no
      material labor dispute exists or, to the knowledge of the Company, is imminent
      with respect to any of the employees of the Company or any
      Subsidiary.

     

    (m) Compliance.
      Except
      as set forth on Schedule
      2(m),
      neither
      the Company nor any Subsidiary (i) is in default under or in violation of (and
      no event has occurred that has not been waived that, with notice or lapse of
      time or both, would result in a default by the Company or any Subsidiary under),
      nor has the Company or any Subsidiary received notice of a claim that it is
      in
      default under or that it is in violation of, any indenture, loan or credit
      agreement or any other agreement or instrument to which it is a party or by
      which it or any of its properties is bound (whether or not such default or
      violation has been waived), (ii) is in violation of any order of any court,
      arbitrator or governmental body, or (iii) is or has been in violation of any
      statute, rule or regulation of any governmental authority, including without
      limitation all foreign, federal, state and local laws relating to taxes,
      environmental protection, occupational health and safety, product quality and
      safety and employment and labor matters, except in each case as could not,
      individually or in the aggregate, have or reasonably be expected to result
      in a
      Material Adverse Effect. The Company is in compliance with all effective
      requirements of the Sarbanes-Oxley Act of 2002, as amended, and the rules and
      regulations thereunder, that are applicable to it, except where such
      noncompliance could not have or reasonably be expected to result in a Material
      Adverse Effect.

     

    (n) Regulatory
      Permits.
      The
      Company and the Subsidiaries possess all certificates, authorizations and
      permits issued by the appropriate federal, state, local or foreign regulatory
      authorities necessary to conduct their respective businesses as described in
      the
      SEC Reports, except where the failure to possess such permits could not,
      individually or in the aggregate, have or reasonably be expected to result
      in a
      Material Adverse Effect, and neither the Company nor any Subsidiary has received
      any notice of proceedings relating to the revocation or modification of any
      such
      permits.

     

    (o) Title
      to Assets.
      Except
      as set forth on Schedule
      2(o),
      the
      Company and the Subsidiaries have good and marketable title in fee simple to
      all
      real property owned by them that is material to their respective businesses
      and
      good and marketable title in all personal property owned by them that is
      material to their respective businesses, in each case free and clear of all
      Liens, except for Liens as do not materially affect the value of such property
      and do not materially interfere with the use made and proposed to be made of
      such property by the Company and the Subsidiaries. Any real property and
      facilities held under lease by the Company and the Subsidiaries are held by
      them
      under valid, subsisting and enforceable leases of which the Company and the
      Subsidiaries are in compliance, except as could not, individually or in the
      aggregate, have or reasonably be expected to result in a Material Adverse
      Effect.

    
      
         

      

      
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    (p) Patents
      and Trademarks.
      The
      Company and the Subsidiaries have, or have rights to use, all patents, patent
      applications, trademarks, trademark applications, service marks, trade names,
      copyrights, licenses and other similar rights that are necessary or material
      for
      use in connection with their respective businesses as described in the SEC
      Reports and which the failure to so have could, individually or in the
      aggregate, have or reasonably be expected to result in a Material Adverse Effect
      (collectively, the “Intellectual
      Property Rights”).
      Except
      as set forth on Schedule
      2(p),
      neither
      the Company nor any Subsidiary has received a written notice that the
      Intellectual Property Rights used by the Company or any Subsidiary violates
      or
      infringes upon the rights of any Person. Except as set forth in the SEC Reports,
      to the knowledge of the Company, all such Intellectual Property Rights are
      enforceable and there is no existing infringement by another Person of any
      of
      the Intellectual Property Rights.

     

    (q) Insurance.
      The
      Company and the Subsidiaries are insured by insurers of recognized financial
      responsibility against such losses and risks and in such amounts as are prudent
      and customary in the businesses in which the Company and the Subsidiaries are
      engaged. The Company is the named beneficiary of a key-man life insurance policy
      with respect to its Chief Executive Officer for a coverage amount of no less
      than $1,000,000. The Company has a directors and officers liability insurance
      policy with respect to the Company’s Board of Directors for a coverage amount of
      no less than $5,000,000. The Company has no reason to believe that it will
      not
      be able to renew its and the Subsidiaries’ existing insurance coverage as and
      when such coverage expires or to obtain similar coverage from similar insurers
      as may be necessary to continue its business on terms consistent with market
      for
      the Company’s and such Subsidiaries’ respective lines of business.

     

    (r) Transactions
      With Affiliates and Employees.
      Except
      as set forth in or otherwise not required to be disclosed in the SEC Reports,
      none of the officers or directors of the Company and, to the knowledge of the
      Company, none of the employees of the Company or any Subsidiary is presently
      a
      party to any transaction with the Company or any Subsidiary (other than for
      services as employees, officers and directors), including any contract,
      agreement or other arrangement providing for the furnishing of services to
      or
      by, providing for rental of real or personal property to or from, or otherwise
      requiring payments to or from any officer, director or such employee or, to
      the
      knowledge of the Company, any entity in which any officer, director, or any
      such
      employee has a substantial interest or is an officer, director, trustee or
      partner.

     

    (s) Internal
      Accounting Controls.
      The
      Company and the Subsidiaries maintain a system of internal accounting controls
      sufficient to provide reasonable assurance that (i) transactions are executed
      in
      accordance with management’s general or specific authorizations, (ii)
      transactions are recorded as necessary to permit preparation of financial
      statements in conformity with GAAP and to maintain asset accountability, (iii)
      access to assets is permitted only in accordance with management’s general or
      specific authorization, and (iv) the recorded accountability for assets is
      compared with the existing assets at reasonable intervals and appropriate action
      is taken with respect to any differences. The Company has established disclosure
      controls and procedures (as defined in Exchange Act Rules 13a-15(e) and
      15d-15(e)) for the Company and designed such disclosure controls and procedures
      to ensure that material information relating to the Company, including its
      Subsidiaries, is made known to the certifying officers by others within those
      entities, particularly

    
      
         

      

      
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    during
      the period in which the Company’s Form 10-K or 10-Q, as the case may be, is
      being prepared. The Company’s certifying officers have evaluated the
      effectiveness of the Company’s controls and procedures in accordance with Item
      307 of Regulation S-K under the Exchange Act for the Company’s most recently
      ended fiscal quarter or fiscal year-end (such date, the “Evaluation
      Date”).
      The
      Company presented in its most recently filed Form 10-K or Form 10-Q the
      conclusions of the certifying officers about the effectiveness of the disclosure
      controls and procedures based on their evaluations as of the Evaluation Date.
      Since the Evaluation Date, there have been no significant changes in the
      Company’s internal controls (as such term is defined in Item 308T of Regulation
      S-K under the Exchange Act) or, to the Company’s knowledge, in other factors
      that could significantly affect the Company’s internal controls.

     

    (t) Solvency.
      Based
      on the financial condition of the Company and each Subsidiary as of the Closing
      Date (and assuming that the Closing shall have occurred), (i) the Company’s and
      each Subsidiary’s fair saleable value of its assets exceeds the amount that will
      be required to be paid on or in respect of the Company’s and each Subsidiary’s
      existing debts and other liabilities (including known contingent liabilities)
      as
      they mature, (ii) the Company’s and each Subsidiary’s assets do not constitute
      unreasonably small capital to carry on its business for the current fiscal
      year
      as now conducted and as proposed to be conducted including its capital needs
      taking into account the particular capital requirements of the business
      conducted by the Company and each Subsidiary, and projected capital requirements
      and capital availability thereof, and (iii) the current cash flow of the Company
      and each Subsidiary, together with the proceeds the Company and each Subsidiary
      would receive, were it to liquidate all of its assets, after taking into account
      all anticipated uses of the cash, would be sufficient to pay all amounts on
      or
      in respect of its debt when such amounts are required to be paid. The Company
      and each Subsidiary does not intend to incur debts beyond its ability to pay
      such debts as they mature (taking into account the timing and amounts of cash
      to
      be payable on or in respect of its debt). 

     

    (u) Certain
      Fees.
      Except
      as described in Schedule
      2(u),
      no
      brokerage or finder’s fees or commissions are or will be payable by the Company
      or any Subsidiary to any broker, financial advisor or consultant, finder,
      placement agent, investment banker, bank or other Person with respect to the
      transactions contemplated by this Agreement. The Investor shall have no
      obligation with respect to any fees or with respect to any claims (other than
      such fees or commissions owed by the Investor pursuant to written agreements
      executed by the Investor which fees or commissions shall be the sole
      responsibility of the Investor) made by or on behalf of other Person for fees
      of
      a type contemplated in this Section 3(u) that may be due in connection with
      the
      transactions contemplated by this Agreement.

     

    (v) Certain
      Registration Matters.
      Assuming the accuracy of the Investor’s representations and warranties set forth
      in Section 4, no registration under the Securities Act is required for the
      offer
      and sale of the Securities by the Company to the Investor under the Transaction
      Documents. The Company is eligible to register its Common Stock for resale
      by
      the Investor under Form S-1 promulgated under the Securities Act. Except as
      specified in the SEC Reports and except as set forth on Schedule
      2(v),
      neither
      the Company nor any Subsidiary has granted or agreed to grant to any Person
      any
      rights (including “piggy-back” registration rights) to

    
      
         

      

      
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    have
      any
      securities of the Company registered with the SEC or any other governmental
      authority that have not been satisfied.

     

    (w) Listing
      and Maintenance Requirements.
      Except
      as specified in the SEC Reports, the Company has not, since February 13, 2007,
      received notice from any Trading Market to the effect that the Company is not
      in
      compliance with the listing, quoting or maintenance requirements thereof. The
      Company is, and has no reason to believe that it will not in the foreseeable
      future continue to be, in compliance with the listing, quoting or maintenance
      requirements for continued listing or quoting of the Common Stock on the Trading
      Market on which the Common Stock is currently listed or quoted. The issuance
      and
      sale of the Securities under the Transaction Documents does not contravene
      the
      rules and regulations of the Trading Market on which the Common Stock is
      currently listed or quoted, and no approval of the stockholders of the Company
      thereunder is required for the Company to issue and deliver to the Investor
      the
      Securities contemplated by Transaction Documents.

     

    (x) Investment
      Company.
      The
      Company and each Subsidiary is not, and is not an Affiliate of, and immediately
      following the Closing will not have become, an “investment company” within the
      meaning of the Investment Company Act of 1940, as amended.

     

    (y) Application
      of Takeover Protections.
      The
      Company has taken all necessary action, if any, in order to render inapplicable
      any control share acquisition, business combination, poison pill (including
      any
      distribution under a rights agreement) or other similar anti-takeover provision
      under the Company’s certificate of incorporation (or similar charter documents)
      or the laws of its state of incorporation that is or could become applicable
      to
      the Investor as a result of the Investor and the Company fulfilling their
      obligations or exercising their rights under the Transaction Documents,
      including without limitation the Company’s issuance of the Securities and the
      Investor’s ownership of the Securities.

     

    (z) No
      Additional Agreements.
      The
      Company does not have any agreement or understanding with the Investor with
      respect to the transactions contemplated by the Transaction Documents other
      than
      as specified in the Transaction Documents.

     

    (aa) Consultation
      with Auditors.
      The
      Company and each Subsidiary has consulted its independent auditors concerning
      the accounting treatment of the transactions contemplated by the Transaction
      Documents, and in connection therewith has furnished such auditors complete
      copies of the Transaction Documents.

     

    (bb) Foreign
      Corrupt Practices Act.
      Neither
      the Company nor any Subsidiary, nor to the knowledge of the Company, any agent
      or other person acting on behalf of any of the Company or any Subsidiary, has,
      directly or indirectly, (i) used any funds, or will use any proceeds from the
      sale of the Securities, for unlawful contributions, gifts, entertainment or
      other unlawful expenses related to foreign or domestic political activity,
      (ii)
      made any unlawful payment to foreign or domestic government officials or
      employees or to any foreign or domestic political parties or campaigns from
      corporate funds, (iii) failed to disclose fully any contribution made by the
      Company or any Subsidiary (or made by any Person acting on their behalf of
      which
      the Company is aware)

    
      
         

      

      
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    which
      is
      in violation of law, or (iv) has violated in any material respect any provision
      of the Foreign Corrupt Practices Act of 1977, as amended, and the rules and
      regulations thereunder.

     

    (cc) PFIC.
      Neither
      the Company nor any Subsidiary is or intends to become a “passive foreign
      investment company” within the meaning of Section 1297 of the U.S. Internal
      Revenue Code of 1986, as amended.

     

    (dd) OFAC.
      Neither
      the Company nor any Subsidiary nor, to the knowledge of the Company, any
      director, officer, agent, employee, Affiliate or Person acting on behalf of
      the
      Company or any Subsidiary is currently subject to any U.S. sanctions
      administered by the Office of Foreign Assets Control of the U.S. Treasury
      Department (“OFAC”);
      and
      the Company will not directly or indirectly use the proceeds of the sale of
      the
      Securities, or lend, contribute or otherwise make available such proceeds to
      any
      Subsidiary, joint venture partner or other Person or entity, towards any sales
      or operations in Cuba, Iran, Syria, Sudan, Myanmar or any other country
      sanctioned by OFAC or for the purpose of financing the activities of any Person
      currently subject to any U.S. sanctions administered by OFAC.

     

    (ee) Money
      Laundering Laws.
      The
      operations of each of the Company and any Subsidiary are and have been conducted
      at all times in compliance with the money laundering statutes of applicable
      jurisdictions, the rules and regulations thereunder and any related or similar
      rules, regulations or guidelines, issued, administered or enforced by any
      applicable governmental agency (collectively, the “Money
      Laundering Laws”)
      and no
      action, suit or proceeding by or before any court or governmental agency,
      authority or body or any arbitrator involving the Company and/or any Subsidiary
      with respect to the Money Laundering Laws is pending or, to the best knowledge
      of the Company, threatened.

     

    (ff) Dependence
      on Major Customers.
      No
      single customer of the Company or any of its Subsidiaries accounted for more
      than 10% of the Company’s or any of its Subsidiaries’ total sales during the
      calendar year of 2007.

     

    (gg) Disclosure.
      All
      disclosure provided to the Investor regarding the Company (including each
      Subsidiary), its and any Subsidiary’s business and the transactions contemplated
      hereby, furnished by or on behalf of the Company (including the Company’s
      representations and warranties set forth in this Agreement) are true and correct
      and do not contain any untrue statement of a material fact or omit to state
      any
      material fact necessary in order to make the statements made therein, in light
      of the circumstances under which they were made, not misleading.

     

    4. Representations
      and Warranties of the Investor.
      The
      Investor hereby represents and warrants to the Company as follows:

     

    (a) This
      Agreement is made by the Company with the Investor who is a Non-U.S. Person
      in
      reliance upon such Non-U.S. Person’s representations, warranties and covenants
      made in this Section 4.

     

    (b) Such
      Non-U.S. Person has been advised and acknowledges that (i) the Securities have
      not been, and when issued, will not be registered under the Securities Act,
      the
      securities laws of

    
      
         

      

      
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          11 -

        
          

        

      

      
         

      

    

     

    any
      state
      of the United States or the securities laws of any other country; (ii) in
      issuing and selling the Securities to such Non-U.S. Person pursuant hereto,
      the
      Company is relying upon the “safe harbor” provided by Regulation S and/or on
      Section 4(2) under the Securities Act; (iii) it is a condition to the
      availability of the Regulation S “safe harbor” that the Securities not be
      offered or sold in the United States or to a U.S. Person until the expiration
      of
      a period of six (6) months following the Closing Date; (iv) notwithstanding
      the
      foregoing, prior to the expiration of six (6) months after the Closing (the
      “Restricted
      Period”),
      the
      Securities may be offered and sold by the holder thereof only if such offer
      and
      sale is made in compliance with the terms of this Agreement and either: (A)
      if
      the offer or sale is within the United States or to or for the account of a
      U.S.
      Person, the Securities are offered and sold pursuant to an effective
      registration statement or pursuant to Rule 144 under the Securities Act or
      pursuant to an exemption from the registration requirements of the Securities
      Act; or (B) the offer and sale is outside the United States and to other than
      a
      U.S. Person.

     

    (c) As
      used
      in this Agreement, the term “United
      States”
      means
      and includes the United States of America, its territories and possessions,
      any
      State of the United States, and the District of Columbia, the term “U.S.
      Person”
      means:
      (i) a natural person resident in the United States; (ii) any partnership or
      corporation organized or incorporated under the laws of the United States;
      (iii)
      any estate of which any executor or administrator is a U.S. person; (iv) any
      trust of which any trustee is a U.S. person; (v) any agency or branch of a
      foreign entity located in the United States; (vi) any nondiscretionary account
      or similar account (other than an estate or trust) held by a dealer or other
      fiduciary for the benefit or account of a U.S. person; (vii) any discretionary
      account or similar account (other than an estate or trust) held by a dealer
      or
      other fiduciary organized, incorporated and (if an individual) resident in
      the
      United States; or (viii) a corporation or partnership organized under the laws
      of any foreign jurisdiction and formed by a U.S. person principally for the
      purpose of investing in securities not registered under the Securities Act,
      unless it is organized or incorporated, and owned, by accredited investors
      (as
      defined in Rule 501(a) under the Securities Act) who are not natural persons,
      estates or trusts, and the term “Non-U.S.
      Person”
      means
      any person who is not a U.S. Person or is deemed not to be a U.S. Person under
      Rule 902(k)(2) of the Securities Act.

     

    (d) Such
      Non-U.S. Person agrees that with respect to the Securities until the expiration
      of the Restricted Period: (i) such Non-U.S. Person, its agents or its
      representatives have not and will not solicit offers to buy, offer for sale
      or
      sell any of the Securities, or any beneficial interest therein in the United
      States or to or for the account of a U.S. Person during the Restricted Period;
      (ii) notwithstanding the foregoing, prior to the expiration of the Restricted
      Period, the Securities may be offered and sold by the holder thereof only if
      such offer and sale is made in compliance with the terms of this Agreement
      and
      either: (A) if the offer or sale is within the United States or to or for the
      account of a U.S. Person, the Securities are offered and sold pursuant to an
      effective registration statement or pursuant to Rule 144 under the Securities
      Act or pursuant to an exemption from the registration requirements of the
      Securities Act; or (B) the offer and sale is outside the United States and
      to
      other than a U.S. Person; and (iii) such Non-U.S. Person shall not engage in
      hedging transactions with regard to the Securities unless in compliance with
      the
      Securities Act. The foregoing restrictions are binding upon subsequent
      transferees of the Securities, except for transferees pursuant to an effective
      registration statement. Such Non-U.S. Person agrees that after

    
      
         

      

      
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          12 -

        
          

        

      

      
         

      

    

     

    the
      Restricted Period, the Securities may be offered or sold within the United
      States or to or for the account of a U.S. Person only pursuant to applicable
      securities laws.

     

    (e) Such
      Non-U.S. Person has not engaged, nor is it aware that any party has engaged,
      and
      such Non-U.S. Person will not engage or cause any third party to engage, in
      any
      directed selling efforts (as such term is defined in Regulation S) in the United
      States with respect to the Securities.

     

    (f) Such
      Non-U.S. Person: (i) is domiciled and has its principal place of business
      outside the United States; (ii) certifies it is not a U.S. Person and is not
      acquiring the Securities for the account or benefit of any U.S. Person; and
      (iii) at the time of the Closing Date, the Non-U.S. Person or persons acting
      on
      Non-U.S. Person’s behalf in connection therewith will be located outside the
      United States.

     

    (g) At
      the
      time of offering to such Non-U.S. Person and communication of such Non-U.S.
      Person’s order to purchase the Securities and at the time of such Non-U.S.
      Person’s execution of this Agreement, the Non-U.S. Person or persons acting on
      Non-U.S. Person’s behalf in connection therewith were located outside the United
      States.

     

    (h) Such
      Non-U.S. Person is not a “distributor” (as defined in Regulation S) or a
“dealer” (as defined in the Securities Act).

     

    (i) Such
      Non-U.S. Person acknowledges that the Company shall make a notation in its
      stock
      books regarding the restrictions on transfer set forth in this Section 4
      and shall transfer such Securities on the books of the Company only to the
      extent consistent therewith. In particular, such Non-U.S. Person acknowledges
      that the Company shall refuse to register any transfer of the Securities not
      made in accordance with the provisions of Regulation S, pursuant to registration
      under the Securities Act or pursuant to an available exemption from
      registration.

     

    (j) The
      Investor understands and agrees that the Notes being issued hereunder shall
      bear
      the legend set forth on the form attached hereto as Exhibit
      A,
      until
      (i) the shares of Common Stock underlying the Notes shall have been registered
      under the Securities Act pursuant to a registration statement that has been
      declared effective or (ii) in the opinion of counsel reasonably acceptable
      to
      the Company, such Securities may be sold without registration under the
      Securities Act as well as any applicable “Blue Sky” or state securities
      laws.

     

    (k) The
      Investor understands and agrees that the Warrants being issued hereunder shall
      bear the legend set forth on the form attached hereto as Exhibit
      B,
      until
      (i) the shares of Common Stock underlying the Warrants shall have been
      registered under the Securities Act pursuant to a registration statement that
      has been declared effective or (ii) in the opinion of counsel reasonably
      acceptable to the Company, such Securities may be sold without registration
      under the Securities Act as well as any applicable “Blue Sky” or state
      securities laws.

     

    (l) The
      Investor understands and agrees that the certificates for the Common Stock
      that
      are issuable upon conversion of the Notes or exercise of the Warrants shall
      bear
      substantially the following legend until (i) such Securities shall have been
      registered under the Securities Act

    
      
         

      

      
        -
          13 -

        
          

        

      

      
         

      

    

     

    pursuant
      to a registration statement that has been declared effective or (ii) in the
      opinion of counsel reasonably acceptable to the Company, such Securities may
      be
      sold without registration under the Securities Act as well as any applicable
      “Blue Sky” or state securities laws:

     

    THE
      SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
      ACT
      OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND MAY NOT BE SOLD, TRANSFERRED,
      ASSIGNED, PLEDGED OR HYPOTHECATED EXCEPT IN ACCORDANCE WITH THE PROVISIONS
      OF
      REGULATION S PROMULGATED UNDER THE SECURITIES ACT, PURSUANT TO REGISTRATION
      UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM
      REGISTRATION. HEDGING TRANSACTIONS INVOLVING THE SHARES REPRESENTED HEREBY
      MAY
      NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE SECURITIES ACT. THIS
      CERTIFICATE MUST BE SURRENDERED TO THE COMPANY OR ITS TRANSFER AGENT AS A
      CONDITION PRECEDENT TO THE SALE, PLEDGE, HYPOTHECATION OR ANY OTHER TRANSFER
      OF
      ANY INTEREST IN ANY OF THE SHARES REPRESENTED BY THIS CERTIFICATE.

     

    (m) The
      Investor hereby represents that the Investor is satisfied as to the full
      observance of the laws of such Investor’s jurisdiction in connection with any
      invitation to subscribe for the Securities, including (i) the legal requirements
      within such Investor’s jurisdiction for the purchase of the Securities, (ii) any
      foreign exchange restrictions applicable to such purchase, (iii) any
      governmental or other consents that may need to be obtained and (iv) the income
      tax and other tax consequences, if any, that may be relevant to the purchase,
      holding, redemption, sale or transfer of such Securities. Such Investor’s
      subscription and payment for, and such Investor’s continued beneficial ownership
      of, the Securities, will not violate any applicable securities or other laws
      of
      such Investor’s jurisdiction.

     

    (n) The
      Investor has full power and authority to enter into this Agreement, the
      execution and delivery of which has been duly authorized, if applicable, and
      this Agreement constitutes a valid and legally binding obligation of the
      Investor enforceable against the Investor in accordance with its terms, except
      as such enforceability may be limited by general principles of equity or to
      applicable bankruptcy, insolvency, reorganization, moratorium, liquidation
      and
      other similar laws relating to, or affecting generally, the enforcement of
      applicable creditors’ rights and remedies.

     

    (o) The
      information in the “Investor Questionnaire,” attached hereto as Exhibit
      C,
      completed and executed by the Investor (the “Investor
      Questionnaire”)
      is
      accurate and true in all material respects.

     

    (p) The
      Investor is not relying on the Company or its Affiliates with respect to
      economic considerations involved in this investment.

     

    (q) The
      Investor understands and agrees that the Investor must bear the economic risk
      of
      the Investor’s purchase because, among other reasons, the Securities have not
      been registered under the Securities Act or under the securities laws of any
      state and, therefore, cannot be resold,

    
      
         

      

      
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    assigned
      or otherwise disposed of unless they are subsequently registered under the
      Securities Act and under the applicable securities laws of such states, or
      an
      exemption from such registration is available. 

     

    (r) No
      representations or warranties have been made to the Investor by the Company
      or
      any of its officers, employees, agents, Affiliates or subsidiaries, other than
      any representations of the Company contained herein, and in subscribing for
      the
      Securities the Investor is not relying upon any representations other than
      any
      contained herein; provided that nothing contained herein shall modify, amend
      or
      affect the Investor’s right to rely on the Company’s representations and
      warranties contained herein.

     

    (s) The
      Investor understands and acknowledges that the Investor’s purchase of the
      Securities is a speculative investment that involves a high degree of risk
      and
      the potential loss of the Investor’s entire investment.

     

    (t) Neither
      the SEC nor any state securities commission has approved the Securities, or
      passed upon or endorsed the merits of this offering or confirmed the accuracy
      or
      determined the adequacy of any information provided to the Investor by the
      Company.

     

    (u) The
      Investor and the Investor’s advisors, if any, have had a reasonable opportunity
      to ask questions of and receive answers from a person or persons acting on
      behalf of the Company concerning the offering and the business, financial
      condition, results of operations and prospects of the Company, and all such
      questions have been answered to the reasonable satisfaction of the Investor
      and
      the Investor’s advisors, if any.

     

    (v) The
      Investor is unaware of, is in no way relying on, and did not become aware of
      the
      offering through or as a result of, any article, notice, advertisement or other
      communication published in any newspaper, magazine or similar media or broadcast
      over television, radio or over the Internet, in connection with the offering
      and
      sale of the Securities and is not subscribing for the Securities and did not
      become aware of the offering of the Securities through or as a result of any
      seminar or meeting to which the Investor was invited by, or any solicitation
      of
      a subscription by, a person not previously known to the Investor in connection
      with investments in securities generally.

     

    (w) The
      Investor has not engaged any placement agent, financial advisor or broker,
      which
      would give rise to any claim by any person for brokerage commissions, finders’
fees or the like relating to this Agreement or the transactions contemplated
      hereby and, in turn, to be paid to other selected dealers.

     

    (x) The
      foregoing representations, warranties and agreements shall survive the
      Closing.

    
      
         

      

      
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          15 -

        
          

        

      

      
         

      

    

     

    5. Other
      Agreements of the Parties. 

     

    (a)  Securities
      may only be disposed of in compliance with state and federal securities laws.
      In
      connection with any transfer of the Securities other than pursuant to an
      effective registration statement, to the Company, to an Affiliate of the
      Investor or in connection with a pledge as contemplated in Section 5(b), the
      Company may require the transferor thereof to provide to the Company an opinion
      of counsel selected by the transferor, the form and substance of which opinion
      shall be reasonably satisfactory to the Company, to the effect that such
      transfer does not require registration of such transferred Securities under
      the
      Securities Act.

     

    (b) The
      Company acknowledges and agrees that the Investor may from time to time pledge,
      and/or grant a security interest in some or all of the Securities pursuant
      to a
      bona fide margin agreement in connection with a bona fide margin account and,
      if
      required under the terms of such agreement or account, such Investor may
      transfer pledged or secured Securities to the pledgees or secured parties.
      Such
      a pledge or transfer would not be subject to approval or consent of the Company
      and no legal opinion of legal counsel to the pledgee, secured party or pledgor
      shall be required in connection with the pledge, but such legal opinion may
      be
      required in connection with a subsequent transfer following default by the
      Investor transferee of the pledge. No notice shall be required of such pledge.
      At the appropriate Investor’s expense, the Company will execute and deliver such
      reasonable documentation as a pledgee or secured party of Securities may
      reasonably request in connection with a pledge or transfer of the Securities
      including the preparation and filing of any required prospectus supplement
      under
      Rule 424(b)(3) of the Securities Act or other applicable provision of the
      Securities Act to appropriately amend the list of selling stockholders
      thereunder. Except as otherwise provided in Section 5(c), any shares subject
      to
      a pledge or security interest as contemplated by this Section 5(b) shall
      continue to bear the legend set forth in this Agreement and be subject to the
      restrictions on transfer set forth in Section 5(a).

     

    (c) Certificates
      evidencing shares of Common Stock issuable upon conversion of the Notes or
      exercise of the Warrants shall not contain any legend, including the legend
      set
      forth in Section 4(l): (i) following a sale or transfer of such shares pursuant
      to an effective registration statement (including a Note Registration Statement
      and a Warrant Registration Statement, both as defined below), or (ii) following
      a sale or transfer of such shares pursuant to Rule 144 (assuming the transferee
      is not an Affiliate of the Company). If
      the
      Investor shall make a sale or transfer of shares either (x) pursuant to Rule
      144
      or (y) pursuant to a registration statement and in each case shall have
      delivered to the Company or the Company’s
      transfer
      agent the certificate representing shares containing a restrictive legend which
      are the subject of such sale or transfer
      and a representation letter in customary form (the
      date of
      such sale or transfer and share delivery being the “Share
      Delivery Date”)
      and (1)
      the Company shall fail to deliver or cause to be delivered to the Investor
      a
      certificate representing such shares that is free from all restrictive or other
      legends by the third Trading Day (as defined in the Note) following the Share
      Delivery Date and (2) following such third Trading Day after the Share Delivery
      Date and prior to the time such shares are received free from restrictive
      legends, the Investor, or any third party on behalf of such Investor, purchases
      (in an open market transaction or otherwise) shares of Common Stock to deliver
      in satisfaction of a sale by the Investor of such shares (a "Buy-In"),
      then
      the Company shall pay in cash to the Investor (for costs incurred either
      directly by such Investor or on behalf of a third party) the amount by which
      the
      total

    
      
         

      

      
        -
          16 -

        
          

        

      

      
         

      

    

     

    purchase
      price paid for Common Stock as a result of the Buy-In (including brokerage
      commissions, if any) exceed the proceeds received by such Investor as a result
      of the sale to which such Buy-In relates. The Investor shall provide the Company
      written notice indicating the amounts payable to the Investor in respect of
      the
      Buy-In. “Note
      Registration Statement”
means
      a
      registration statement meeting the requirements set forth in the Note
      Registration Rights Agreement and covering the resale by the Investor of the
      shares of Common Stock underling the Note. “Warrant
      Registration Statement”
means
      a
      registration statement meeting the requirements set forth in the Warrant
      Registration Rights Agreement and covering the resale by the Investor of the
      shares of Common Stock underling the Warrant.

     

    (d) As
      long
      as the Investor owns the Securities, the Company covenants to timely file (or
      obtain extensions in respect thereof and file within the applicable grace
      period) all reports required to be filed by the Company after the date hereof
      pursuant to the Exchange Act. As long as the Investor owns Securities, if the
      Company is not required to file reports pursuant to such laws, it will prepare
      and furnish to the Investor and make publicly available in accordance with
      Rule
      144 such information as is required for the Investor to sell the Securities
      under Rule 144. The Company further covenants that it will take such further
      action as any holder of Securities may reasonably request, all to the extent
      required from time to time to enable such Person to sell the Securities without
      registration under the Securities Act within the limitation of the exemptions
      provided by Rule 144.

     

    (e) The
      Company shall not, and shall use its best efforts to ensure that no Affiliate
      of
      the Company shall, sell, offer for sale or solicit offers to buy or otherwise
      negotiate in respect of any security (as defined in Section 2 of the Securities
      Act) that would be integrated with the offer or sale of the Securities in a
      manner that would require the registration under the Securities Act of the
      sale
      of the Securities to the Investor, or that would be integrated with the offer
      or
      sale of the Securities for purposes of the rules and regulations of any Trading
      Market in a manner that would require stockholder approval of the sale of the
      Securities to the Investor.

     

    (f) By
      9:00
      a.m. (New York time) four (4) Trading Days following the execution of this
      Agreement, and by 9:00 a.m. (New York time) four (4) Trading Days following
      the
      Initial Closing Date, the Company shall issue press releases disclosing the
      transactions contemplated hereby and the Initial Closing. Within four (4)
      Trading Days following the execution of this Agreement, the Company will file
      a
      current report on Form 8-K disclosing the material terms of the Transaction
      Documents (and attach as exhibits thereto the Transaction Documents), and within
      four (4) Trading Days following the Initial Closing Date the Company will file
      an additional current report on Form 8-K to disclose the Initial Closing. In
      addition, the Company will make such other filings and notices in the manner
      and
      time required by the SEC and the Trading Market on which the Common Stock is
      quoted or listed in connection with the Transaction Documents. 

     

    (g) In
      addition to the indemnity provided in any other Transaction Document, the
      Company will indemnify and hold the Investor and its directors, officers,
      shareholders, partners, employees and agents (each, an “Investor
      Party”)
      harmless from any and all losses, liabilities, obligations, claims,
      contingencies, damages, costs and expenses, including all judgments, amounts
      paid in settlements, court costs and reasonable attorneys’ fees and costs of
      investigation that any

    
      
         

      

      
        -
          17 -

        
          

        

      

      
         

      

    

     

    such
      Investor Party may suffer or incur as a result of or relating to any
      misrepresentation, breach or inaccuracy of any representation, warranty,
      covenant or agreement made by the Company in any Transaction Document. In
      addition to the indemnity contained herein, the Company will reimburse each
      Investor Party for its reasonable legal and other expenses (including the cost
      of any investigation, preparation and travel in connection therewith) incurred
      in connection therewith, as such expenses are incurred. Except as otherwise
      set
      forth herein, the mechanics and procedures with respect to the rights and
      obligations under this Section 5(g) shall be the same as those set forth in
      Section 5 of the Warrant Registration Rights Agreement and Section 5 of the
      Note
      Registration Rights Agreement.

     

    (h) 
      The
      Company covenants and agrees that neither it nor any other Person acting on
      its
      behalf will provide the Investor or its agents or counsel with any information
      that the Company believes constitutes material non-public information, unless
      prior thereto such Investor shall have executed a written agreement regarding
      the confidentiality and use of such information. The Company understands and
      confirms that the Investor shall be relying on the foregoing representations
      in
      effecting transactions in securities of the Company.

     

    (i) The
      Company agrees, (i) if the Company applies to have the Common Stock listed
      or
      quoted on any Trading Market, other than the Trading Market on which the Common
      Stock is currently listed or quoted, it will include in such application the
      shares of Common Stock issuable upon conversion of the Notes and exercise of
      the
      Warrants, and will take such other action as is necessary or desirable to cause
      such shares to be listed or quoted on such other Trading Market as promptly
      as
      possible, and (ii) it will take all action reasonably necessary to continue
      the
      listing or quoting of its Common Stock on a Trading Market and will comply
      in
      all material respects with the Company’s reporting, filing and other obligations
      under the bylaws or rules of the Trading Market.

     

    (j) Prior
      to
      the Initial Closing, Company will not, without the Investor's prior written
      consent: (i) change the nature of its business; (ii) issue any equity, equity
      securities (other than stock options issued pursuant to Company’s stock option
      plan in the ordinary course of business) or debt in any form; (iii) divest,
      acquire, change the structure of its assets or otherwise decrease the value
      of
      its assets; or (iv) enter into any collaboration, partnership, distribution
      or
      other agreement binding Company to any future payments, services or other
      contractual obligations exceeding in value $250,000 (other than certain
      acquisitions contemplated by Company which have been previously disclosed to
      the
      Investor).

     

    (k) The
      Company will keep the existence and
      content of its negotiations with the Investor, including the terms of the
      Transaction Documents, confidential and will not disclose to any third party
      any
      information relating to the transactions hereunder, except to its employees,
      shareholders, Affiliates, counsel or consultants, who will each be bound by
      confidentiality agreements and who will have a ‘need to know’, and except as
      required by law. Except as required by applicable law, the Company will make
      no
      public statement, press release, or other announcement with respect to the
      transactions hereunder, without the Investor’s prior written approval. The
      Investor will maintain all confidential information it obtains from the Company
      in accordance with the provisions of that certain Confidentiality Agreement,
      dated as of December 26, 2007, by and among the Investor and the Company.
      Notwithstanding the foregoing, any activities

    
      
         

      

      
        -
          18 -

        
          

        

      

      
         

      

    

     

    undertaken
      by the Investor on behalf of the Company, such as discussions with potential
      investors or strategic partners, will not be deemed to be a breach of the
      Investor’s confidentiality obligations.

     

    (l) The
      Investor and the Company agree not to engage in any activities designed to
      manipulate the trading price of the Common Stock. 

     

    6. Conditions
      to Closing of the Investor.
      The
      Investor’s obligations at each Closing are subject to the fulfillment, on or
      prior to each Closing Date, of all of the following conditions, any of which
      may
      be waived in whole or in part by the Investor:

     

    (a) Representations
      and Warranties.
      The
      representations and warranties made by the Company in Section 3 shall have
      been true and correct when made, and shall be true and correct on such Closing
      Date. 

     

    (b) Performance.
      The
      Company shall have performed, satisfied and complied in all material respects
      with all covenants, agreements and conditions required by the Transaction
      Documents to be performed, satisfied or complied with by it at or prior to
      such
      Closing Date;

     

    (c) No
      Injunction.
      No
      statute, rule, regulation, executive order, decree, ruling or injunction shall
      have been enacted, entered, promulgated or endorsed by any court or governmental
      authority of competent jurisdiction that prohibits the consummation of any
      of
      the transactions contemplated by the Transaction Documents;

     

    (d) Transaction
      Documents.
      The
      Company shall have duly executed and delivered to the Investor the following
      documents (collectively, the “Transaction
      Documents”):

     

    (i) this
      Agreement;

     

    (ii) a
      Note
      issued in accordance with Section 2;

     

    (iii) a
      Warrant
      issued in accordance with Section 2;

     

    (iv) the
      Registration Rights Agreement, dated as of the date of this Agreement, between
      the Company and the Investor, substantially in the form attached hereto as
      Exhibit
      D, pursuant
      to which the Company shall be obligated file a Registration Statement on Form
      S-1, covering the shares of Common Stock underlying the Notes no later than
      ninety (90) days following the conversion of the Notes (the “Note
      Registration Rights Agreement”);
      and

     

    (v) the
      Registration Rights Agreement, dated as of the date of this Agreement, between
      the Company and the Investor, substantially in the form attached hereto as
      Exhibit
      E, pursuant
      to which the Company shall be obligated to file a Registration Statement on
      Form
      S-1, covering the shares of Common Stock underlying the Warrants no later than
      ninety (90) days following the exercise of the Warrants (the “Warrant
      Registration Rights Agreement”);
      provided, however, that this Agreement, the Note Registration Rights Agreement
      and the Warrant

    
      
         

      

      
        -
          19 -

        
          

        

      

      
         

      

    

     

    Registration
      Rights Agreement shall only be required to be executed and delivered at the
      Initial Closing; 

     

    (e) Officer’s
      Certificate.
      The
      Company shall have delivered to the Investor a certificate of the Company,
      dated
      as of the Closing Date, signed by the Chief Executive Officer of the Company,
      confirming that since the date of execution of this Agreement, no event or
      series of events have occurred that reasonably could have or result in a
      Material Adverse Effect; 

     

    (f) Legal
      Opinion.
      At the
      Initial Closing and each closing which occurs after October 31, 2008, the
      Company shall have delivered to the Investor a legal opinion of Loeb & Loeb
      LLP, in agreed form, addressed to the Investor and a legal opinion of
Carr
      McClellan Ingersoll Thompson & Horn Professional Law Corporation,
      in
      agreed form, addressed to the Investor; 

     

    (g) Good
      Standing Certificate.
      The
      Company shall have delivered to the Investor good standing certificates from
      (a)
      the State of Delaware and (b) the State of Washington, dated as of no more
      than
      three days prior to the Closing Date, certifying that the Company is in good
      standing and qualified to do business in these jurisdictions;

     

    (h) Secretary’s
      Certificate.
      At the
      Initial Closing, the Company shall have delivered to the Investor a certificate
      duly executed by the Secretary of the Company, having attached thereto and
      certified resolutions approved by the Board of Directors of the Company
      authorizing the transactions contemplated hereunder; 

     

    (i) Waivers.
      The
      Company shall have delivered to the Investor validly executed waivers of
      preemptive rights or any other rights that the stockholders of the Company
      may
      have in connection with this Agreement and the transaction contemplated
      hereunder, in a form reasonably suitable to the Investor; and 

     

    (j) No
      Suspensions of Trading in Common Stock; Listing.
      Trading
      in the Common Stock shall not have been suspended by the SEC or any Trading
      Market (except for any suspensions of trading of not more than one Trading
      Day
      solely to permit dissemination of material information regarding the Company)
      at
      any time since the date of execution of this Agreement, and the Common Stock
      shall have been at all times since such date listed or quoted for trading on
      a
      Trading Market.

     

    7. Conditions
      to Obligations of the Company.
      The
      Company’s obligation to issue and sell the Notes at each Closing is subject to
      the fulfillment, on or prior to each Closing Date, of the following conditions,
      any of which may be waived in whole or in part by the Company:

     

    (a) Representations
      and Warranties.
      The
      representations and warranties made by the Investor in Section 4 shall be
      true and correct when made, and shall be true and correct on such Closing
      Date;

     

    (b) Performance.
      The
      Investor shall have performed, satisfied and complied in all material respects
      with all covenants, agreements and conditions required by the Transaction
      Documents to be performed, satisfied or complied with by such Investor at or
      prior to such Closing Date;

    
      
         

      

      
        -
          20 -

        
          

        

      

      
         

      

    

     

    (c) No
      Injunction.
      No
      statute, rule, regulation, executive order, decree, ruling or injunction shall
      have been enacted, entered, promulgated or endorsed by any court or governmental
      authority of competent jurisdiction that prohibits the consummation of any
      of
      the transactions contemplated by the Transaction Documents;

     

    (d) Transaction
      Documents.
      At the
      Initial Closing, the Investor shall have duly executed and delivered to the
      Investor the following documents:

     

    (i) this
      Agreement;

     

    (ii) the
      Note
      Registration Rights Agreement; and

     

    (iii) the
      Warrant Registration Rights Agreement; and

     

    (e) Purchase
      Price.
      The
      Investor shall have delivered to the Company the Purchase Price in respect
      of
      the Note and Warrant being purchased by the Investor referenced in
      Section 2.

     

    8. Miscellaneous.

     

    (a) Waivers
      and Amendments.
      Any
      provision of this Agreement may be amended, waived or modified only upon the
      written consent of the Company and the Investor.

     

    (b) Governing
      Law.
      This
      Agreement and all actions arising out of or in connection with this Agreement
      shall be governed by and construed in accordance with the laws of the State
      of
      New York, without regard to the conflicts of law provisions of the State of
      New
      York or of any other state. 

     

    (c) Survival.
      The
      representations, warranties, covenants and agreements made herein shall survive
      the execution and delivery of this Agreement.

     

    (d) Successors
      and Assigns.
      Subject
      to the restrictions on transfer described in Sections 8(e)
      and 8(f) below, the rights and obligations of the Company and the
      Investor shall be binding upon and benefit the successors, assigns, heirs,
      administrators and transferees of the parties.

     

    (e) Registration,
      Transfer and Replacement of the Notes.
      The
      Notes issuable under this Agreement shall be registered notes. The Company
      will
      keep, at its principal executive office, books for the registration and
      registration of transfer of the Notes. Prior to presentation of any Note for
      registration of transfer, the Company shall treat the Person in whose name
      such
      Note is registered as the owner and holder of such Note for all purposes
      whatsoever, whether or not such Note shall be overdue, and the Company shall
      not
      be affected by notice to the contrary. Subject to the restrictions on or
      conditions to transfer set forth in this Agreement or in any Note, the holder
      of
      any Note, at its option, may in person or by duly authorized attorney surrender
      the same for exchange at the Company’s principal executive office, and promptly
      thereafter and at the Company’s expense, except as provided below, receive in
      exchange therefor one or more new Note(s), each in the principal requested
      by
      such holder, dated the date of the Note so surrendered and registered in the
      name of such Person or Persons as shall have been designated in writing by
      such
      holder or its

    
      
         

      

      
        -
          21 -

        
          

        

      

      
         

      

    

     

    attorney
      for the same principal amount as the principal amount of the Note so
      surrendered. Upon receipt by the Company of evidence reasonably satisfactory
      to
      it of the ownership of and the loss, theft, destruction or mutilation of any
      Note and (a) in the case of loss, theft or destruction, of indemnity
      reasonably satisfactory to it; or (b) in the case of mutilation, upon
      surrender thereof, the Company, at its expense, will execute and deliver in
      lieu
      thereof a new Note executed in the same manner as the Note being replaced,
      in
      the same principal amount as the principal amount of such Note and dated the
      date of such Note.

     

    (f) Assignment
      by the Company.
      The
      rights, interests or obligations hereunder may not be assigned, by operation
      of
      law or otherwise, in whole or in part, by the Company.

     

    (g) Entire
      Agreement.
      This
      Agreement together with the other Transaction Documents constitute and contain
      the entire agreement among the Company and the Investor and supersede any and
      all prior agreements, negotiations, correspondence, understandings and
      communications among the parties, whether written or oral, respecting the
      subject matter hereof.

     

    (h) Notices.
      All
      notices and other communications made pursuant to this Agreement shall be in
      writing and shall be conclusively deemed to have been duly given: 

     

    (i) in
      the
      case of hand delivery to the address set forth below, on the next Business
      Day
      after delivery;

     

    (ii) in
      the
      case of delivery by an internationally recognized overnight courier to the
      address set forth below, freight prepaid, on the next Business Day after
      delivery and signed receipt by the recipient; and 

     

    (iii) in
      the
      case of a notice sent by facsimile transmission to the number and addressed
      as
      set forth below, on the next Business Day after delivery, if receipt of such
      facsimile transmission is confirmed. 

     

    For
      all
      notices given pursuant to one of the methods listed above, a copy of the notice
      should also be sent by email to the email address set forth below.

     

    Contact
      details:

     

    If
      to
      Investor:

     

    Address
      for notices being delivered by hand/courier: 

    

    c/o
      Inventages Whealth Management Inc.

    Winterbotham
      Place, Marlborough & Queen Streets

    P.
      O. Box
      N-3026

    Nassau,
      The Bahamas, Attn: Dr. Gunnar Weikert

    
      
         

      

      
        -
          22 -

        
          

        

      

      
         

      

    

     Always
      with a copy to: IVC SA, Route de Coppet 26A, 1291 - Commugny,  Switzerland,
      Attn: Dr. Bogdan von Rueckmann

    

     Always
      with a copy to:  weikert@inventages.com
      and
 portfolio@inventages.com

    

     Number
      for notices being delivered by facsimile transmission:

    

     To:
      IVC
      SA, Attn: Dr. Bogdan von Rueckmann, at: +41 21 823 0001

    

     Always
      with a copy to: weikert@inventages.com
      and
 portfolio@inventages.com 

    

    If
      to the
      Company:  

    

     Address
      for notices being delivered by hand/courier:

    

    Organic
      To Go Food Corporation

    3317
      Third Avenue South

    Seattle,
      Washington 98134

    Attn:
      Chief Financial Officer

    

    Always
      with a copy to:

    

    Loeb
      & Loeb LLP

    10100
      Santa Monica Boulevard

    Suite
      2200

    Los
      Angeles, California 90067

    Attention:
      Lawrence Venick, Esq.

    

    Number
      for notices being delivered by facsimile transmission:

    

    To:
      Organic To Go Food Corporation, Attn: Chief Financial Officer, at: +1
 206
      299
      3707 

    

    Always
      with a copy to: Loeb & Loeb LLP, Attn: Lawrence Venick, Esq, at:
 +1
      310
      282 2200

     

    A
      party
      may change or supplement the contact details for service of any notice pursuant
      to this Agreement, or designate additional addresses, facsimile numbers and
      email addresses for the purposes of this Section 8(h) by giving the other
      parties written notice of the new contact details in the manner set forth
      above.

     

    (i) Arbitration.
      Each
      party agrees that any dispute, controversy, or claim arising in relation to
      this
      Agreement, including with regard to its validity, invalidity, breach,
      enforcement or termination, shall be resolved by binding arbitration in London,
      England, in accordance with the

    
      
         

      

      
        -
          23 -

        
          

        

      

      
         

      

    

     

    rules
      of
      arbitration which are in force in the United Kingdom on the date when the notice
      of arbitration is submitted. The arbitrability of such dispute, claim or
      controversy shall also be determined in such arbitration. Such arbitration
      proceeding shall be conducted in the English language before one (1) arbitrator
      agreed to by the parties. Both the foregoing agreement of the parties to
      arbitrate any and all such disputes, claims and controversies, and the results,
      determinations, findings, judgments and/or awards rendered through any such
      arbitration shall be final and binding on the parties hereto and may be
      specifically enforced by legal proceedings.

     

    (j) Expenses.
      Each
      party shall pay the fees and expenses of its advisers, counsel, accountants
      and
      other experts, if any, and all other expenses incurred by such party incident
      to
      the negotiation, preparation, execution, delivery and performance of the
      Transaction Documents; provided, however, that the Company shall pay up to
      $25,000 in reasonable legal expenses incurred by the Investor. 

     

    (k) Severability.

     

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

     

    (m) Limitation
      of Liability. Notwithstanding
      anything herein to the contrary, the Company acknowledges and agrees that no
      trustee, officer, investment vehicle, investor, shareholder or holder of shares
      of beneficial interest of the Investor shall be personally liable for any
      liabilities of the Investor.

     

    (n) Counterparts.
      This
      Agreement may be executed in one or more counterparts, each of which will be
      deemed an original, but all of which together will constitute one and the same
      agreement. Facsimile copies of signed signature pages will be deemed binding
      originals.

     

     

    [Signature
      Page Follows] 

     

     

    
      
         

      

      
        -
          24 -

        
          

        

      

      
         

      

    

     

    The
      parties have caused this Agreement to be duly executed and delivered by their
      proper and duly authorized officers as of the date and year first written
      above.

     

    COMPANY:

     

    ORGANIC
      TO GO FOOD CORPORATION

    a
      Delaware corporation

     

    By: 
      /s/
      Jason Brown

    Name:
      Jason Brown

    Title:
      Chief Executive Officer

     

    INVESTOR:

     

    W.HEALTH
      L.P.

     

    By: 
      /s/
      Dr. Gunnar Weikert

    Dr.
      Gunnar Weikert

    Director,
      Inventages Whealth Management, Inc., as General Partner of W.Health
      L.P.

     

    By: 
      /s/
      Dr. Wolfgang Reichenberger

    Dr.
      Wolfgang Reichenberger

    Director,
      Inventages Whealth Management, Inc., as General Partner of W.Health
      L.P.

     

     

    
      [Signature
        page for Note and Warrant Purchase Agreement]

       

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    DISCLOSURE
      SCHEDULE

     

     

     

     

     

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    Exhibit
      A

     

    Form
      of Note

     

     

     

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    Exhibit
      B

     

    Form
      of Warrant

     

     

     

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    Exhibit
      C

     

    Investor
      Questionnaire

     

    Organic
      To Go Food Corporation (the “Company”)
      will
      use the responses to this questionnaire to qualify prospective investors for
      purposes of U.S. securities laws.

     

    Your
      answers will be kept confidential at all times. However, by signing this
      questionnaire, you agree that the Company may present this questionnaire to
      such
      parties as it deems appropriate to establish the availability of exemptions
      from
      registration under U.S. securities laws.

     

    
      	
              Investor:

            	   

	 	 
	 	
              Exact
                name as it should appear on the Securities. If the name is a “nominee
                name,” please so state and in addition, provide the name of the legal
                owner.

            
	 	 
	
              Address

            	  

	 	  

	 	  

	 	  

	 	
               

              Address
                for securityholder records. All notices and mailings will be made
                to this
                address. Indicate, if appropriate, the person at that address to
                whose
                attention the mailing should be
                directed.

            

    

     

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    1. Representations,
      Warranties and Agreements.
      In
      order for the Company to offer the notes, shares of common stock and warrants
      (the “Securities”)
      in
      conformance with Regulation S (“Regulation
      S”)
      promulgated under the Securities Act of 1933, as amended (the “Securities
      Act”),
      the
      following information must be obtained. (For purposes of answering the following
      questions, the term “United States” means the United States of America, its
      territories and possessions, any State of the United States and the District
      of
      Columbia.)

     

    (a) Please
      initial the blank that correctly responds to the following statement: The
      undersigned is not purchasing the Securities for the account or benefit of
      any
      person, entity, group or organization that resides in the United States or
      has a
      place of business in the United States.

     

    ____ 
      True

     

    ____
      False

     

    (b) Please
      initial the blank that correctly responds to the following statement: (i) the
      undersigned did not receive an offer to subscribe for the Securities in the
      United States (as defined above); and
      (ii)
      this Investor Suitability Questionnaire (“Questionnaire”)
      is
      being executed and entered into outside of the United States (as defined
      above).

     

    ____
      True

     

    ____
      False

     

    (c) The
      undersigned agrees to transfer the Securities only in accordance with the
      provisions of Regulation S, pursuant to registration under the Securities Act
      or
      pursuant to an available exemption from registration under the Securities Act.
      Any transfer in violation of the preceding sentence will be null and void and
      the Company will not recognize any such attempted transfer. The undersigned
      acknowledges that the Securities are characterized as “restricted securities”
under U.S. federal securities laws and may be resold without registration under
      the Securities Act only in certain limited circumstances. All certificates
      representing shares of common stock will bear legends to this effect.
      Additionally, all of the Securities will be subject to certain contractual
      limitations on transferability.

     

    ____
      True

     

    ____
      False

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    Indicate
      the form of entity of the undersigned:

     

    
      	  
	 	
              Individual

            
	   
	 	
              Corporation

            
	  
	 	
              Limited
                Partnership

            
	  
	 	
              General
                Partnership

            
	  
	 	
              Limited
                Liability Company

            
	  
	 	
              Trust

            
	  
	 	
              Other
                form of organization (indicate form of organization):

            
	  
	 	 

    

     

    The
      foregoing representations and warranties are true and accurate as of the date
      hereof and shall be true and accurate as of the date of the closing (the
“Closing”)
      of any
      sale of the Securities to the undersigned and shall survive such date.
If
      in
      any respect such representations and warranties shall not be true and accurate
      prior to Closing, the undersigned shall give immediate notice of such fact
      to
      the Company, specifying which representations and warranties are not true and
      accurate and the reasons therefor.

     

    2. Indemnification.
      The
      undersigned understands the meaning and legal consequences of the
      representations and warranties made by the undersigned herein, and that the
      Company is relying on such representations and warranties in making its
      determination to accept or reject the undersigned’s offer to purchase the
      Securities in this offering. The undersigned hereby agrees to indemnify and
      hold
      harmless the Company and each director, officer, employee or agent thereof
      from
      and against any and all loss, damage or liability due to or arising out of
      a
      breach of any representation or warranty of the undersigned contained in this
      Questionnaire.

     

    3. Survival
      of Representations, Warranties and Agreements.
      All
      representations, warranties and agreements contained herein or made in writing
      by or on behalf of the undersigned in connection with the transactions
      contemplated hereby shall survive the Closing of any sale of Securities by
      the
      Company to the undersigned.

     

    4. Headings.
      The
      headings in this Questionnaire are for convenience of reference, and shall
      not
      by themselves determine the meaning of this Questionnaire or of any part
      hereof.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    CORPORATIONS,
      PARTNERSHIPS, LLCs, TRUSTS AND OTHER ENTITIES

     

    Date:
      June 1, 2008

    
      	 	   

	 	
              NAME
                OF ENTITY

            
	 	   

	 	
              BY
                (Signature)

            
	 	    

	 	
              PRINT
                NAME

            
	 	    

	 	
              TITLE

            
	 	 
	 	
              PRINCIPAL
                PLACE OF BUSINESS:

            
	 	   

	 	
              NUMBER
                AND STREET

            
	 	    

	 	
              CITY/PROVINCE/COUNTRY/POSTAL
                CODE

            
	 	    

	 	
              TELEPHONE
                NUMBER

            
	 	   

	 	
              FAX
                NUMBER

            

    

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    Exhibit
      D

     

    Note
      Registration Rights Agreement 

     

     

     

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    Exhibit
      E

     

    Warrant
      Registration Rights AgreementEX 10.3

     

     

    EXHIBIT
      10.3

     

    THIS
      NOTE AND THE SECURITIES ISSUABLE UPON THE CONVERSION HEREOF HAVE NOT BEEN
      REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”),
      AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED, PLEDGED OR HYPOTHECATED EXCEPT
      IN
      ACCORDANCE WITH THE PROVISIONS OF REGULATION S PROMULGATED UNDER THE SECURITIES
      ACT, PURSUANT TO REGISTRATION UNDER THE SECURITIES ACT OR PURSUANT TO AN
      AVAILABLE EXEMPTION FROM REGISTRATION. HEDGING TRANSACTIONS INVOLVING THE
      SECURITIES REPRESENTED HEREBY MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH
      THE
      SECURITIES ACT. THIS
      NOTE MUST BE SURRENDERED TO THE COMPANY OR ITS TRANSFER AGENT AS A CONDITION
      PRECEDENT TO THE SALE, PLEDGE, HYPOTHECATION OR ANY OTHER TRANSFER OF ANY
      INTEREST IN ANY OF THE SECURITIES REPRESENTED BY THIS
      NOTE.

     

    ORGANIC
      TO GO FOOD CORPORATION

     

    CONVERTIBLE
      PROMISSORY NOTE

     

    
      	
              $[_______________]

            	
              [____________,
                200_]

            
	 	
              Seattle,
                Washington

            

    

     

    FOR
      VALUE
      RECEIVED, Organic To Go Food Corporation, a Delaware corporation (the
“Company”)
      promises to pay to W.Health L.P., a limited partnership organized under the
      laws
      of the Bahamas (“Investor”),
      or
      its registered assigns, in lawful money of the United States of America the
      principal sum of [__________] Dollars ($[_________]), payable in shares of
      common stock, par value $0.001 (“Common
      Stock”),
      of
      the Company on [to insert a date that is 21 months after the Initial Closing
      Date] (the “Maturity
      Date”)
      in
      accordance with the terms hereof. This Note is one of the “Notes” issued
      pursuant to the Note and Warrant Purchase Agreement, dated as of June 1, 2008
      (as amended, modified or supplemented, the “Note
      and Warrant Purchase Agreement”)
      between the Company and the Investor (as defined in the Note and Warrant
      Purchase Agreement). 

     

    Capitalized
      terms not otherwise defined herein shall have the meaning set forth in the
      Note
      and Warrant Purchase Agreement. 

     

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

     

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

     

    (a) “Adjusted
      Closing Price” has
      the
      meaning given in Section
      2(c)(ii).

     

    (b) “Base
      Amount” has
      the
      meaning given in
      Section 2(c)(i).

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

     

    (c) “Change
      in Control” shall
      mean:  (1) the consummation of the sale, transfer, conveyance or other
      disposition (including any merger, reorganization or consolidation) in one
      or a
      series of related transactions of the voting equity securities of the Company
      or
      a similar transaction (or transactions) such that immediately following such
      transaction (or transactions) any “person” or related “group” of “persons” (as
      such terms are used in Sections 13(d) and 14(d)(2) of the Exchange
      Act) (other than the Company or an Affiliate of the Company) beneficially owns
      more than fifty percent (50%) of the total voting equity securities of the
      Company outstanding immediately after such transaction; (2) the sale or
      transfer of all or substantially all of the assets of the Company to another
      entity which is not an Affiliate of the Company; or (3) the consummation of
      a merger or consolidation of the Company with any other entity that is not
      an
      Affiliate of the Company, other than a merger or consolidation which would
      result in the voting securities of the Company outstanding immediately prior
      thereto continuing to represent (either by remaining outstanding or by being
      converted into voting securities of the surviving entity or its parent) at
      least
      fifty percent (50%) of the total voting power of the voting securities of the
      Company or such surviving entity or its parent outstanding immediately after
      such merger or consolidation.

     

    (d) “Pre-Sale
      Trading Price” has
      the
      meaning given in Section 2(f)(iii)

     

    (e) “Trading
      Day”
      means
      (i) a day on which the Common Stock is traded on a Trading Market (other than
      the OTC Bulletin Board), or (ii) if the Common Stock is not listed on a Trading
      Market (other than the OTC Bulletin Board), a day on which the Common Stock
      is
      traded in the over-the-counter market, as reported by the OTC Bulletin Board,
      or
      (iii) if the Common Stock is not quoted on any Trading Market, a day on which
      the Common Stock is quoted in the over-the-counter market as reported by the
      Pink Sheets LLC (or any similar organization or agency succeeding to its
      functions of reporting prices); provided, that in the event that the Common
      Stock is not listed or quoted as set forth in (i), (ii) and (iii) hereof, then
      Trading Day shall mean a Business Day. 

     

    2. Conversion.

     

    (a) Automatic
      Conversion. The
      outstanding principal amount of this Note shall automatically convert into
      shares of Common Stock upon the earliest to occur of the following:

     

    (i) the
      Maturity Date; or

     

    (ii) subject
      to Section
      2(f)
      below,
      the date upon which the closing price of the Common Stock on the Trading Market
      it is listed or quoted on is and has been $3.00 per share (subject to
      adjustments in accordance with Section
      3)
      or more
      on each Trading Day during a period of 60 consecutive calendar days preceding
      such date.

     

    Upon
      such
      conversion of this Note, the Investor hereby agrees to deliver the original
      of
      this Note (or a notice to the effect that the original Note has been lost,
      stolen or destroyed and an agreement acceptable to the Company whereby the
      holder agrees to indemnify the Company from any loss incurred by it in
      connection with this Note) for cancellation; provided,
      however,
      that
      upon satisfaction of the conditions set forth in this Section 2(a),
      this
      Note shall be deemed converted and

    
      
         

      

      
        -
          2
          -

        
          

        

      

      
         

      

    

     

    of
      no
      further force and effect, whether or not it is delivered for cancellation as
      set
      forth in this sentence.

     

    (b) Optional
      Conversion. Subject
      to Sections
      2(d) and 2(e)
      below,
      if this Note has not been converted pursuant to Section
      2(a),
      then
      all, but not less than all, of the outstanding principal amount of this Note
      shall be convertible into shares of Common Stock at the option of the Investor
      any time before the Maturity Date. Before the Investor shall be entitled to
      convert this Note into shares of Common Stock under this Section
      2(b),
      the
      Investor shall surrender this Note, duly endorsed, at the office of the Company
      and shall give written notice to the Company at its principal corporate office,
      of the election to convert the same pursuant to this Section
      2(b),
      and
      shall state the name in which the certificate for shares of Common Stock are
      to
      be issued. The Company shall, as soon as practicable thereafter, issue and
      deliver at such office to Investor a certificate for the number of shares of
      Common Stock to which Investor shall be entitled upon conversion (bearing such
      legends as are required by the Note and Warrant Purchase Agreement and
      applicable state and federal securities laws in the opinion of counsel to the
      Company) and any other securities and property to which Investor is entitled
      upon such conversion under the terms of this Note. The conversion shall be
      deemed to have been made immediately prior to the close of business on the
      date
      of the surrender of this Note, and the Person entitled to receive the shares
      of
      Common Stock upon such conversion shall be treated for all purposes as the
      record holder of such shares of Common Stock as of such date.

     

    (c) Conversion
      Calculation.
      The
      number of shares of Common Stock the Investor is entitled to receive upon
      conversion of this Note in accordance with this Section
      2
      shall be
      determined as follows:

     

    (i) Except
      as
      otherwise provided in Section
      2(c)(ii),
      the
      Investor shall receive such number of shares of Common Stock as determined
      by
      the following formula (the “Base
      Amount”):

     

    A/10,000,000*4,333,333

     

    where:

     

    A
      = the
      principal amount of this Note. 

     

    For
      example, for a Note with a principal amount of $5,000,000, the Investor would
      receive 2,166,667 shares of Common Stock calculated as follows:

     

    
      	
              Investment
                amount

            	 	
              $

            	
              5,000,000

            	 
	
              Divided
                by total investment

            	 	
              $

            	
              10,000,000

            	 
	
              Percent
                of total investment

            	 	 	
              50

            	
              %

            
	
              Multiplied
                by total shares for $10MM

            	 	 	
              4,333,333

            	 
	
              Shares
                issued for $5MM investment

            	 	 	
              2,166,667

            	 

    

     

     

    
      
         

      

      
        -
          3
          -

        
          

        

      

      
         

      

    

     

    (ii)
      If this
      Note is converted on the Maturity Date and the average closing price of the
      Common Stock on the Trading Market it is listed or quoted on during the ten
      (10)
      Trading Days ending three (3) days before the date of conversion (the
“Adjusted
      Closing Price”)
      is less
      than $3.00 (subject to adjustment in accordance with Section
      3 and
      subject to Section 2(f)),
      then
      the Investor shall receive such number of shares of Common Stock as determined
      by the following formula: 

     

    A*3/(B*.70)

     

    where:

     

    A
      = the
      Base Amount; and

     

    B
      = the
      Adjusted Closing Price.

     

    For
      example, if the Adjusted Closing Price is $2.95, the Investor would receive
      3,147,700 shares of Common Stock calculated as follows:

     

    
      	
              Base
                Amount

            	 	 	
              2,166,667

            	 
	
              Multiplied
                by 3

            	 	 	
              3.00

            	 
	 	 	 	
              6,500,000

            	 
	
              Divided
                by 70% of the Adjusted Closing Price

            	 	 	
              2.065

            	 
	
              Adjusted
                number of shares 

            	 	 	
              3,147,700

            	 

    

     

    (d) Conversion
      upon a Change in Control.
      Upon
      the occurrence of a Change in Control in the Company, the principal balance
      of
      this Note shall be due and payable immediately in cash plus accrued and
      unpaid interest at the rate of 25% per annum, compounded on an annual
      basis.

     

    (e) Event
      of Default. If
      an
      Event of Default shall occur, then at the election of the Investor, upon a
      notice to the Company (a) this Note shall be immediately converted into shares
      of Common Stock pursuant to the formula detailed in Section
      2(c)(ii)
      (where
“B” equals the closing price of the Common Stock on the date of the Event of
      Default), or (b) the principal balance of this Note plus accrued and unpaid
      interest at the rate of 25% per annum, compounded on an annual basis,
      shall become due and payable immediately in cash.

     

    (f) Price
      Manipulation.
      

     

    (i) In
      case
      the Company or any of its Subsidiaries or Affiliates, or any of the
      directors or officers of the Company or their Affiliates, purchase shares
      of Common Stock of the Company or cause others to purchase shares of Common
      Stock of the Company and, during the next full three (3) Trading Days
      following any such purchase the stock price rises above $3.00 per
      share, then principal balance of this Note shall be due and payable
      immediately in cash plus accrued and unpaid interest at the rate of
      50% per annum, compounded on an annual basis.  

    
      
         

      

      
        -
          4
          -

        
          

        

      

      
         

      

    

     

    (ii) In
      case
      the Investor engages in any activity designed to manipulate the trading price
      of
      the Common Stock or sells shares of Common Stock beneficially owned by the
      Investor, or over which the Investor has dispositive control, (A) more than
      two (2) times every three (3) months or more than seven (7) times in the
      aggregate during the period beginning on the Initial Closing Date and ending
      on
      the Maturity Date, or (B) in blocks of less than 250,000 shares of Common Stock
      per sale, then this Note will automatically convert into shares of Common Stock
      pursuant to the formula set forth in Section
      2(c)(i).
      

     

    (iii) During
      the three (3) months immediately prior to the Maturity Date, if the Investor
      sells shares of Common Stock and, during the next full three (3) Trading Days
      following any such sale the trading price of the Common Stock falls below the
      trading price of the Common Stock immediately prior to such sale (the
“Pre-Sale
      Trading Price”),
      and
      the Pre-Sale Trading Price is less than $3.00, then this Note will automatically
      convert into shares of Common Stock pursuant to the formula set forth in
Section
      2(c)(ii)
      (where
“B” equals the Pre-Sale Trading Price); provided, however, if the Pre-Sale
      Trading Price is $3.00 or more, then this Note will automatically convert into
      shares of Common Stock pursuant to the formula set forth in Section
      2(c)(i).

     

    (g) Fractional
      Shares; Interest; Effect of Conversion. No
      fractional shares shall be issued upon conversion of this Note. Upon conversion
      of this Note in full, the Company shall be forever released from all its
      obligations and liabilities under this Note

     

    3. Adjustments.
      

     

    (a) Adjustments
      for distributions, splits or subdivisions. In
      the
      event the Company at any time or from time to time after the date of issuance
      hereof fixes a record date for the effectuation of a split or subdivision of
      any
      outstanding shares of Common Stock or the determination of holders of any shares
      of Common Stock entitled to receive a distribution without payment of any
      consideration by such holder, then, as of such record date (or the date of
      such
      distribution, split or subdivision if no record date is fixed), then the closing
      price of the Common Stock referenced in Sections
      2(a)(ii), 2(c)(ii) and 2(f) and
      the
      conversion formulas referenced in Section
      2(c)(i) and 2(c)(ii)
      shall be
      adjusted appropriately.

     

    (b) Adjustment
      for Reclassification, Exchange and Substitution.
      If
      the
      shares of Common Stock issuable upon the conversion of this Note are changed
      into the same or a different number of shares or units of any class or classes
      of capital stock, whether by recapitalization, reclassification, or otherwise,
      then, and in any such event, the Investor shall have the right thereafter to
      convert this Note into the kind and amount of such capital stock and property
      receivable upon such reorganization, reclassification, or other change in
      accordance with the number of shares of Common Stock into which this Note would
      have been converted immediately prior to such reorganization, reclassification,
      or change.

     

    4. Successors
      and Assigns.
      Subject
      to the restrictions on transfer described in the Note and Warrant Purchase
      Agreement, the rights and obligations of the Company and Investor shall be
      binding upon and benefit the successors, assigns, heirs, administrators and
      transferees of the parties.

    
      
         

      

      
        -
          5
          -

        
          

        

      

      
         

      

    

     

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

     

    6. Notices.
      All
      notices, requests, demands, consents, instructions or other communications
      required or permitted hereunder shall in be in accordance with the notice
      provisions set forth in the Note and Warrant Purchase Agreement. 

     

    7. Pari
      Passu Notes.
      Investor
      acknowledges and agrees that the payment of all or any portion of the
      outstanding principal amount of this Note and all interest hereon shall be
      pari
      passu in
      right
      of payment and in all other respects to the other Notes issued pursuant to
      the
      Note and Warrant Purchase Agreement or pursuant to the terms of such Notes.
      In
      the event the holder of this Note receives payments in excess of its pro rata
      share of the Company’s payments to the holders of all of the Notes, then such
      holder shall hold in trust all such excess payments for the benefit of the
      holders of the other Notes and shall pay such amounts held in trust to such
      other holders upon demand by such holders.

     

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

     

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

     

    10. Governing
      Law.
      This
      Note and all actions arising out of or in connection with this Note shall be
      governed by and construed in accordance with the laws of the State of New York,
      without regard to the conflicts of law provisions of the State of New York,
      or
      of any other state.

     

    11. Arbitration.
      Any
      dispute, controversy, or claim arising in relation to this Note, including
      with
      regard to its validity, invalidity, breach, enforcement or termination, shall
      be
      resolved by binding arbitration in London, England, in accordance with the
      rules
      of arbitration which are in force in the United Kingdom on the date when the
      notice of arbitration is submitted. The arbitrability of such dispute, claim
      or
      controversy shall also be determined in such arbitration. Such arbitration
      proceeding shall be conducted in the English language before one (1) arbitrator
      agreed to by the parties. Both the foregoing agreement of the parties to
      arbitrate any and all such disputes, claims and controversies, and the results,
      determinations, findings, judgments and/or awards rendered through any such
      arbitration shall be final and binding on the parties hereto and may be
      specifically enforced by legal proceedings.

     

     

    [Signature
      Page Follows]

     

     

    
      
         

      

      
        -
          6
          -

        
          

        

      

      
         

      

       

       

    

    The
      Company has caused this Note to be issued as of the date first written
      above.

     

    Organic
      To Go Food Corporation

    a
      Delaware corporation

     

     

    By: 
      ___________________________

    Name:
      Jason Brown

    Title:
      Chief Executive Officer

     

     

     

     

     

     

       

      [Signature
        page to Convertible Promissory Note]

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