**Exhibit 10.23**

 

**CONFIDENTIALTREATMENT REQUESTED. CERTAIN PORTIONS HAVE BEEN OMITTED AND HAVEBEEN FILED SEPARATELY WITH THE COMMISSION.**

 

**DNADREAMFIELDS COMPANY, LLC**

**AMENDMENTNo. 2**

**TO**

**OPERATING AGREEMENT**

 

THIS SECOND AMENDMENT TOOPERATING AGREEMENT (the “Amendment”) is entered into between and among B-New,LLC, an Ohio limited liability company (“BNEW”), TechCom Group, LLC, a Floridalimited liability company (“TechCom”), Buhler, Inc., a Minnesota corporation (“Buhler”),and Dakota Growers Pasta Company, Inc., a North Dakota corporation (“Dakota”)(BNEW, TechCom, Buhler and Dakota may be referred to herein as a “Member” andcollectively as the “Members”).

 

RECITALS

 

WHEREAS, the Members enteredinto an Operating Agreement as of October 31, 2003, and entered into a first amendment of the OperatingAgreement effective February 9, 2004 (collectively, the “Agreement”).

 

WHEREAS, the Members are allof the members of DNA Dreamfields Company, LLC, an Ohio limited liabilitycompany (the “Company”), as of the date hereof; and

 

WHEREAS, the Members desire to amend certainprovisions of the Agreement relating to initial capital contributions andallocation of deductions and losses among the Members and to clarify theintended scope of Member liability;

 

WHEREAS, the Members furtherdesire that the amendments be applied both prospectively and retroactively, asif such amendment had been included in the Agreement as originally adopted bythe Members.

 

NOW, THEREFORE, the partieshereto agree as follows:

 

1.             Amendment.  The Members hereby agree that the followingprovisions of the Agreement shall be amended in their entirety and replaced bythe applicable provisions set forth below. All other terms, conditions, and provisions of the Agreement shallcontinue in full force and effect.  TheMembers further agree that the amendment contained in this Amendment shall beeffective between and among the partners as of the date of formation of theCompany;  theMembers further agree that the books and records of the Company shall reflectthe impact of such amendment.

 

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2.             Allocations;Distributions.  Sections 3(E)(i) and (ii) of the Agreement, governing the allocation ofprofits and losses, shall be amended by the deletion of current Sections3(E)(i) and (ii) and the insertion of the following provision:

 

(E)           Allocations.

 

(i)            After giving effect to the special allocation provisionshereof, and except as set forth in subsection (ii) below, profits and lossesshall be allocated among the Members in proportion to their respective Units.

 

(ii)           Notwithstanding anything containedherein, any gain on sale of the Brand shall be allocated as necessary so thatafter reducing the Members’ respective Section 704 capital accounts by anydistribution made or to be made pursuant to Section 3(F)(ii),and after then allocating such gain, the Members’ respective Section 704capital account balances are in proportion to their respective Units.

 

3.             SpecialAllocation of Start-up Amortization. Section 3(E)(iii)(h) of the Operating Agreementshall be deleted in its entirety and shall have no further force and effect.

 

4.             CapitalContributions.  Section 2(A) of theAgreement, governing initial capital contributions shall be amended by deletionof the current Section 2(A) and inserting of the following provision:

 

(A)          InitialContributions.

 

(i)            Each Member has on or before the date hereof contributedto the capital of the Company the cash listed on Exhibit A, and has been issuedthe number of membership units (“Units”) in the Company listed on Exhibit A.

 

(ii)           Buhler shall contribute, when and as needed, additionalfunds as provided for in the schedule attached hereto as Exhibit B to theCompany to pay for the development of science, proof of principle, clinicalstudies and credential/claims development necessary to implement the Company’sbusiness plan.  Such contributions shallbe made by the payment by Buhler to the Company of applicable invoicessubmitted by vendors of the Company, including invoices for the management feesprovided under section 6(E)(i) and/or (ii) below, andapplicable internal costs incurred by Buhler and accounted for by Buhler to theBoard of Managers.  Buhler hereby assignsand conveys all of its rights, title and interest in and to processingtechnology specifically developed and applied for Dreamfields pasta to theCompany as a capital contribution at an agreed value of $***. Suchcontributions shall be an additional capitalcontributions by Buhler without the issuance of any additional Units.

 

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(iii)          Dakota shall contribute, when and as needed, additionalfunds as provided for in the schedule attached hereto as Exhibit B to theCompany to pay for the development of supply chain, product packagedevelopment, consumer research, test market launch and regional roll out,advertising and merchandising necessary to implement the Company’s businessplan.  Such contributions shall be madeby the payment by Dakota to the Company of applicable invoices submitted byvendors of the Company, including invoices for the management fees providedunder section 6(E)(i) and/or (ii) below, andapplicable internal costs incurred by Dakota and accounted for by Dakota to theBoard of Managers.  Such contributionshall be an additional capital contribution by Dakota without the issuance ofany additional Units.

 

(iv)          B-New hereby assigns and conveys all of its rights, title and interest inand to the Brand to the Company as a capital contribution having an agreedvalue of $***. Such contribution shall be a additionalcapital contribution by B-New without the issuance of any additional Units.

 

(v)           TechCom’s grant of the license to the Technology to theCompany, as more particularly described in Section 6(E)(iv), shall be treatedas a capital contribution having an agreed value of $***. Such contributionshall be an additional capital contribution by TechCom without the issuance ofany additional Units.

 

(vi)          The agreed values of the property contributions of Buhler,B-New and TechCom when combined with the cash contributions of Dakota andBuhler are intended to be ***.  In theevent the combined cash contributions of Dakota and Buhler are less than thetotal amount required by Exhibit B, the agreed value of the propertycontributions of Buhler, B-New and TechCom shall be ***.

 

(vii)         Notwithstanding anything contained herein, if and to theextent the Company incurs legal fees under section 6(E)(iv)(2)of this Agreement, one or more Members may loan the needed funds to theCompany.  Such loan or loans shall bearinterest on the outstanding amount of 8% per annum, and all loaned funds, andall accrued interest, shall be paid in full prior to any distribution to theMembers of Distributable Cash Flow.

 

5.             Liabilityof Members.  The first sentence ofSection 2(D) of the Operating Agreement relating to the liability of Membersfor capital contributions and loans shall be deleted in its entirety and theintended liability limitation shall be incorporated into and clarified in thefollowing new sentence which shall be added at the end of Section 15(A):

 

“Except as otherwise provided in thepreceding sentence, notwithstanding anything contained herein, no Member shallbe liable under a judgment, decree, or order of a court, or in any othermanner, for the debts or any other obligations or liabilities of the Company,nor shall any Member be required to make any capital contribution or loan tothe Company after the date hereof except as set forth in section 2(A) above,nor shall any Member be required to restore a deficit balance in its capitalaccounts or, after its capital contributions set forth in section 2(A) havebeen made, to make any additional contributions, assessments, or payments tothe Company.”

 

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*** - Confidential treatmentrequested.

 

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6.             Counterparts.  This Amendment may be executed incounterparts which taken together shall constitute one instrument,notwithstanding the fact that all parties have not executed this Amendment onthe same date or that all signatures do not appear on the same copy.

 

7.             Captions.  Captions are included for convenientreference only and shall not affect the interpretation of any provision of thisAgreement.

 

8.             Severability.  The invalidity, illegality, orunenforceability of any provision of this Amendment shall not affect or impairthe validity, legality, and enforceability of the other provisions hereof or ofthe Agreement and the Amendment and the Agreement shall be construed in allrespects as if such invalid or unenforceable provisions were omitted.

 

*   *   *  *   *

 

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IN WITNESS WHEREOF, the parties have executedthis Amendment.

 
|   | B-New,  LLC                         |
|--------|-------------------------------------|
|   |                                |
|   | By:                                 |   | /s/ Mike Crowley |
|   |                                |   |   |
|   | Title:                              |   | Principal |
|   |                                |   |   |
|   | Date:                               |   | October 25,  2004 |
|   |                                |   |   |
|   |                                |   |   |
|   |                                |   |   |
|   | TechCom  Group, LLC                 |
|   |                                |
|   | By:                                 |   | /s/ Jonathan Anfinsen |
|   |                                |   |   |
|   | Title:                              |   | Director |
|   |                                |   |   |
|   | Date:                               |   | October 25,  2004 |
|   |                                |   |   |
|   |                                |   |   |
|   | Buhler,  Inc.                       |
|   |                                |
|   | By:                                 |   | /s/ Beat Haeni / /s/ A. Holenstein |
|   |                                |   |   |
|   | Title:                              |   | Corp. Development / Project Mgr |
|   |                                |   |   |
|   | Date:                               |   | October 25,  2004 |
|   |                                |   |   |
|   |                                |   |   |
|   | Dakota  Growers Pasta Company, Inc. |
|   |                                |
|   | By:                                 |   | /s/ Tim Dodd |
|   |                                |   |   |
|   | Title:                              |   | President/CEO |
|   |                                |   |   |
|   | Date:                               |   | October 25,  2004 |
|        |                                     |  |  |  |  |

 

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