Document:

ex4_1.htm

    
      

    

    EXHIBIT
      4.1

    

    AMENDED
      AND RESTATED

    CLASS
      C WARRANT AGREEMENT

    

    

    This
      AMENDED AND RESTATED CLASS C
      WARRANT AGREEMENT (this “Warrant Agreement”) is dated and made as of February
      24, 2006 and amended and restated as of June 30, 2006 (the “Restatement Date”),
      by and between ORTHOLOGIC CORP., a Delaware corporation (the “Company”), and
      PHARMABIO DEVELOPMENT INC., a North Carolina corporation,
      doing business as NovaQuest (“NovaQuest”).

    

    WHEREAS,
      the Company and NovaQuest have
      entered into the Common Stock and Warrant Purchase Agreement (the “Purchase
      Agreement”), dated as of February 24, 2006, pursuant to which the Company
      granted to NovaQuest the rights set forth in that certain Class C Warrant
      Agreement (the “Prior Warrant Agreement”), dated as of February 24, 2006 (the
“Prior Warrant Issuance Date”), and the Registration Rights Agreement (the
“Registration Rights Agreement”), dated as of February 24, 2006;

    

    WHEREAS,
      the Company and Quintiles,
      Inc. (“Quintiles”), an affiliate of NovaQuest, have entered into a Master
      Services Agreement also dated as February 24, 2006 (the “Services
      Agreement”);

    

    WHEREAS,
      pursuant to the Purchase
      Agreement, as modified by that certain letter agreement between NovaQuest and
      the Company of even date herewith regarding a waiver of blocking events, the
      parties desire to amend and restate the Prior Warrant Agreement as set forth
      in
      this Warrant Agreement;

    

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

    

    1.            
      The Warrant.

     

    (a)           The
      Company hereby agrees to issue and sell to NovaQuest, its designee or assigns
      (the “Holder”) 80,000 shares (the “Warrant Shares”) of the Company’s Common
      Stock, $0.0005 par value per share (“Common Stock”), at an exercise price of One
      Dollar and Ninety-One Cents ($1.91) per share (the “Exercise Price”) (such
      Exercise Price was calculated as follows: the average of the closing prices
      of
      the shares of Common Stock for the 15 trading days prior to the Restatement
      Date, multiplied by 115%), upon the terms and conditions
      herein set forth, including the vesting schedule set forth in this Section
      1.  The Exercise Price and the number of Warrant Shares purchasable
      upon exercise of this Warrant Agreement are subject to adjustment from time
      to
      time as provided in Section 4 of this Warrant Agreement.

    

    (b)  Upon
      completion of patient enrollment for the existing Phase 2b clinical study of
      the
      TP508 distal radius fracture study by or on behalf of the Company or its
      affiliates (the “Milestone”), the Holder’s right to exercise this Warrant
      Agreement will vest as follows:

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      	
               

            	
              (i)

            	
              if
                the Milestone is achieved by September 30, 2006, One Hundred Percent
                (100%) of the Warrant Shares shall
                vest;

            

    

    

    
      	
               

            	
              (ii)

            	
              if
                the Milestone is achieved after September 30, 2006, but before December
                31, 2006, Fifty Percent (50%) of the Warrant Shares shall
                vest;

            

    

    

    
      	
               

            	
              (iii)

            	
              if
                the Milestone is not achieved by December 31, 2006, none of the Warrant
                Shares shall vest; and

            

    

    

    
      	
               

            	
              (iv)

            	
              any
                Warrant Shares not vested by December 31, 2006 shall
                expire.

            

    

    

    (c)           In
      the event that the Milestone fails to be achieved, or fails to be achievable,
      by
      September 30, 2006, or by another date specified in the vesting schedule set
      forth in Section 1(b) above, and such failure is not caused solely by Quintiles,
      then the Joint Development Committee (as defined in the Services Agreement)
      shall promptly and in good faith review the Milestone, the existing vesting
      schedule, and the events and circumstances that caused or resulted in such
      failure; and the Joint Development Committee shall determine a new vesting
      schedule that shall extend each date within the existing vesting schedule by
      the
      duration of the events or circumstances that caused or resulted in such failure,
      up to one year; provided that the vesting schedule shall be extended pursuant
      to
      this Section 1(c) only once. The parties hereto promptly shall enter into an
      appropriate amendment to this Warrant Agreement reflecting such
      extension.

    

    (d)           Notwithstanding
      Section 1(b), the Holder’s right to exercise this Warrant Agreement will vest
      upon a Change of Control.  “Change of Control” means the occurrence of
      any of the following: (a) any “person” or “group” (as such terms are defined in
      Section 13(d) and Section 14(d) of the Securities Exchange Act of 1934, as
      amended, or any successor provisions (the “Exchange Act”)) becomes the
“beneficial owner” (as determined in accordance with Rule 13d-3 under the
      Exchange Act), directly or indirectly, of shares of voting securities of the
      Company representing 50% or more of the total voting power of all outstanding
      voting securities of the Company; (b) the sale, lease, license, exchange or
      other transfer (in one or a series of transactions) of all or substantially
      all
      of the assets of the Company, or all or substantially all of the assets relating
      to TP508; or (c)  any merger, consolidation, share exchange, business
      combination or similar transaction in which the Company is not the surviving
      entity or in which the holders of the outstanding shares of stock of the Company
      immediately prior to such transaction hold, immediately after such transaction,
      less that 51% of the total voting power of the outstanding securities of the
      surviving or resulting entity in such transaction.

    

    2.           
       Expiration Date.  This Warrant Agreement, and the
      Holder’s right to purchase any of the Warrant Shares, will expire at 5:00 p.m.
      Eastern Time on the tenth anniversary of the Prior Warrant Issuance Date (the
      “Expiration Date”).

    

    3.        
          Exercise of this Warrant
      Agreement.  (a) The Holder may exercise this Warrant Agreement, on
      any Business Day, at any time from and after the date hereof and prior to the
      Expiration Date, in whole or in part, as adjusted from time to time as provided
      in Section 4 of this Warrant Agreement, by:  (a) the surrender of this
      Warrant Agreement, with the Exercise Form substantially in the form attached
      hereto as Annex A properly completed and executed, at the principal office
      of
      the Company, and (b) upon payment by the delivery of a certified check or
      official bank check or wire transfer of immediately available funds, payable
      to
      the order of the Company in an amount equal to the aggregate purchase price
      for
      the Warrant Shares being purchased upon such exercise.  Upon receipt
      thereof by the Company, the Holder will be deemed to be the holder of record
      of
      the Warrant Shares issuable upon such exercise as of the close of business
      on
      the date of such receipt by the Company, and the Company will promptly execute
      or cause to be executed and delivered to the Holder, a certificate or
      certificates representing the aggregate number of Warrant Shares specified
      in
      the Exercise Form.  If this Warrant Agreement is exercised only in
      part, the Company will, at the time of delivery of said stock certificate or
      certificates, deliver to the Holder a new Warrant Agreement of like tenor
      evidencing the right of the Holder to purchase the remaining Warrant Shares
      then
      covered by this Warrant Agreement.  “Business Day” shall mean any day,
      other than a Saturday, Sunday or legal holiday during which banks in North
      Carolina, United States are open for the conduct of their banking
      business.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    (b)           In
      lieu of exercising this Warrant Agreement, the Holder may elect to receive
      shares equal to the value of this Warrant Agreement (or the portion of the
      Warrant Shares hereunder being cancelled or surrendered) by sending written
      notice of such election to the Company, in which event the Company shall deliver
      to the Holder a stock certificate representing a number of shares of Common
      Stock computed using the following formula:

     

    
      X=Y(A-B)

       A

       

      Where:

       

      X
        =the
        number of shares of Common Stock to be issued to the Holder

      

      Y
        =the
        number of shares of Common Stock purchasable under this Warrant Agreement
        as to
        which the Holder is then exercising this Warrant Agreement

      

      A
        =the
        fair
        market value of one share of Common Stock

      

      B
        =the
        Exercise Price (as adjusted to the date of such calculations)

    

     

    (c)           For
      purposes of this Section, “fair market value” of one share of Common Stock shall
      mean the closing price reported on the Nasdaq National Market or the principal
      exchange on which the Common Stock is listed, or the average of the closing
      bid
      and asked prices of the Common Stock quoted in the Over-The-Counter market,
      whichever is applicable, in each such case averaged over a period of fifteen
      (15) consecutive trading days immediately preceding the date that the Exercise
      Form is delivered to the Company. If the Common Stock is
      not traded on such market or exchange, or Over-The-Counter, the fair market
      value of the Common Stock will be the price per share which the Company could
      obtain from a willing buyer for shares sold by the Company from authorized
      but
      unissued shares, as agreed upon by the Company and the Holder in good faith
      or,
      absent such agreement, as shall be determined by arbitration instituted by
      either party under the rules of the American Arbitration
      Association.

    

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    (d)           If
      this Warrant Agreement has not been exercised prior to the Expiration Date,
      the
      Holder shall be deemed to have elected, prior to the close of business on the
      Expiration Date, to receive shares pursuant to this Section 3.

    

    4.      
            Certain Adjustments.  The
      Exercise Price at which Warrant Shares may be purchased and the number of
      Warrant Shares to be purchased upon exercise of this Warrant Agreement are
      subject to change or adjustment from time to time as follows:

    

    (a)           Merger,
      Sale of Assets, etc.  If at any time while this Warrant Agreement,
      or any portion hereof, is outstanding and unexpired there shall be (i) a
      reorganization (other than a combination, reclassification, exchange or
      subdivision of shares otherwise provided for herein), (ii) a merger or
      consolidation of the Company with or into another corporation or entity in
      which
      the Company is not the surviving entity, or a reverse triangular merger or
      share
      exchange in which the Company is the surviving entity but the shares of the
      Company’s capital stock outstanding immediately prior to the merger or share
      exchange are exchanged or converted by virtue of the merger or share exchange
      into other property, whether in the form of securities, cash, or otherwise,
      or
      (iii) a sale, lease, license or other transfer of all or substantially all
      of
      the Company’s properties or assets to any other person or entity, then, as a
      part of such reorganization, merger, consolidation, exchange or other transfer,
      lawful provision shall be made so that the Holder shall thereafter be entitled
      to receive upon exercise of this Warrant Agreement, during the period specified
      herein and upon payment of the Exercise Price then in effect, the number of
      shares of stock or other securities or property resulting from such
      reorganization, merger, consolidation, exchange or other transfer that a holder
      of the shares deliverable upon exercise of this Warrant Agreement would have
      been entitled to receive in such reorganization, merger, consolidation, exchange
      or other transfer if this Warrant Agreement had been exercised immediately
      before the record date of (or the date of, if no record date is fixed) such
      reorganization, merger, consolidation, exchange or other transfer, all subject
      to further adjustment as provided in this Section 4.  The foregoing
      provisions of this Section 4(a) shall similarly apply to successive
      reorganizations, mergers, consolidations, exchanges or other transfers and
      to
      the stock or securities of any other corporation that are at the time receivable
      upon the exercise of this Warrant Agreement.  If the per-share
      consideration payable to the Holder hereof for shares in connection with any
      such transaction is in a form other than cash or marketable securities, then
      the
      value of such consideration shall be reasonably determined in good faith by
      the
      Company’s Board of Directors.  In all events, appropriate adjustment
      (as reasonably determined in good faith by the Company’s Board of Directors)
      shall be made in the application of the provisions of this Warrant Agreement
      with respect to the rights and interests of the Holder after any of the
      above-referenced transactions, to the end that the provisions of this Warrant
      Agreement shall be applicable after such event, as near as reasonably may be,
      in
      relation to any shares or other property deliverable after such event upon
      exercise of this Warrant Agreement.

    

    (b)           Reclassification,
      etc.  If the Company, at any time while this Warrant Agreement, or
      any portion hereof, remains outstanding and unexpired, by reclassification
      of
      securities or otherwise, shall change any of the securities as to which purchase
      rights under this Warrant Agreement exist into the same or a different number
      of
      securities of any other class or classes, this Warrant Agreement shall
      thereafter represent the right to acquire such number and kind of securities
      as
      the Holder would have received if this Warrant Agreement had been exercised
      in
      full immediately prior to such reclassification or other change or immediately
      prior to the record date with respect thereto and the Exercise Price therefor
      shall be appropriately adjusted, all subject to further adjustment as provided
      in this Section 4.  The foregoing provisions of this Section 4(b)
      shall similarly apply to successive reclassifications or other
      changes.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    (c)           Split,
      Subdivision or Combination of Shares.  If the Company, at any time
      while this Warrant Agreement, or any portion hereof, remains outstanding and
      unexpired, shall split, subdivide or combine the securities as to which purchase
      rights under this Warrant Agreement exist, into a different number of securities
      of the same class, the Exercise Price for such securities shall be
      proportionately decreased in the case of a split or subdivision or
      proportionately increased in the case of a combination.  Upon each
      adjustment in the Exercise Price pursuant to this subsection, the number of
      shares of such securities purchasable hereunder shall be adjusted, to the
      nearest whole share, to the product obtained by multiplying the number of shares
      purchasable immediately prior to such adjustment in the Exercise Price by a
      fraction, the numerator of which shall be the Exercise Price immediately prior
      to such adjustment and the denominator of which shall be the Exercise Price
      immediately thereafter.

    

    (d)           Certificate
      as to Adjustments.  Upon the occurrence of each adjustment
      pursuant to this Section 4, the Company at its expense shall promptly compute
      such adjustment in accordance with the terms hereof and furnish to any Holder
      of
      this Warrant Agreement a certificate signed by its Chief Financial Officer
      setting forth such adjustment and showing in detail the event requiring the
      adjustment, the amount of such adjustment, the method by which such adjustment
      was calculated, the Exercise Price at the time in effect, and the number of
      shares and the amount, if any, of the property that at the time would be
      received upon the exercise of this Warrant Agreement, together with the facts
      upon which such adjustment is based.  The Company shall, upon the
      written request, at any time, of any Holder, promptly furnish or cause to be
      furnished to such Holder a like certificate setting forth: (i) all such previous
      adjustments; (ii) the Exercise Price at the time in effect; and (iii) the number
      of shares and the amount, if any, of other property that at the time would
      be
      received upon the exercise of this Warrant Agreement.

    

    (e)           No
      Dilution or Impairment.  The Company will not, by amendment of its
      certificate of incorporation or through any reorganization, recapitalization,
      reclassification, transfer of assets, consolidation, merger, business
      combination, or dissolution, avoid or seek to avoid the intent of this Section
      4
      or the observance or performance of any of the terms to be observed or performed
      by the Company under this Warrant Agreement, but will at all times in good
      faith
      assist in the carrying out of all the provisions of this Section 4 and in the
      taking of all such action as may be necessary or appropriate in order to protect
      the rights of the holder of this Warrant Agreement against
      impairment.

    

    (f)           Conformity
      with Warrant Agreement.  In the event that at any time, as a
      result of any adjustment made pursuant to this Section 4, the Holder thereafter
      shall become entitled to receive any shares of capital stock of the Company
      other than Common Stock, thereafter the number of such other shares so
      receivable upon exercise of the Warrant Agreement shall be subject to adjustment
      from time to time in a manner and on terms as nearly equivalent as practicable
      to the provisions with respect to the Common Stock contained in this Section
      4.

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

    

    5.       
           Fractional Shares.  Fractional
      shares will not be issued upon the exercise of this Warrant Agreement, but
      in
      any case where the Holder would, except for the provisions of this Section,
      be
      entitled under the terms of this Warrant Agreement to receive a fractional
      share
      upon the exercise of this Warrant Agreement, the Company will, upon the exercise
      of this Warrant Agreement for the largest number of whole shares then called
      for, pay a sum in cash equal to the excess of the fair market value of such
      fractional share (determined in such reasonable manner as may be prescribed
      by
      the Board of Directors of the Company in its discretion) over the proportional
      part of the per share purchase price represented by such fractional
      share.

    

    6.       
           Notices of Certain Events.  In
      case:

    

    (a)           the
      Company shall take a record of the holders of its Common Stock (or other stock
      or securities at the time receivable upon the exercise of this Warrant
      Agreement) for the purpose of entitling them to receive any dividend or other
      distribution, or stock subdivision or combination, or any right to subscribe
      for
      or purchase any shares of stock of any class or any other securities, or to
      receive any other right, or

    

    (b)           of
      any reorganization or recapitalization of the Company, any reclassification
      of
      the capital stock of the Company, any consolidation, merger, share exchange
      or
      other business combination of the Company with or into another corporation
      or
      entity, or any sale, lease, license or other transfer of all or substantially
      all of the assets of the Company to another corporation or entity,
      or

    

    (c)           of
      any voluntary dissolution, liquidation or winding-up of the
      Company,

    

    then,
      and
      in each such case, the Company will cause written notice thereof to be delivered
      to the Holder specifying, as the case may be, (i) the date on which a record
      is
      to be taken for the purpose of such dividend, distribution or right, and stating
      the amount and character of such dividend, distribution or right or (ii) the
      date on which such reorganization, recapitalization, reclassification,
      consolidation, merger, share exchange, business combination, transfer,
      dissolution, liquidation or winding-up is to take place, and the time, if any
      is
      to be fixed, as of which the holders of record of Common Stock (or such stock
      or
      securities at the time receivable upon the exercise of this Warrant Agreement)
      shall be entitled to exchange their shares of Common Stock (or such other stock
      or securities) for securities or other property deliverable upon such
      reorganization, reclassification, recapitalization, consolidation, merger,
      share
      exchange, business combination, transfer, dissolution, liquidation or
      winding-up.  Such notice shall be delivered at least ten (10) Business
      Days prior to the date required to be specified therein pursuant to this Section
      6.

    

    7.      
            No Rights as Stockholder; Limitation of
      Liability.  This Warrant Agreement, as distinct from the shares
      for which this Warrant Agreement is exercisable, will not entitle the Holder
      to
      any of the rights of a stockholder of the Company.  No provision of
      this Warrant Agreement, prior to the exercise of this Warrant Agreement, and
      no
      mere enumeration herein of the rights or privileges of the Holder, will give
      rise to any liability of the Holder for the purchase price or as a stockholder
      of the Company, whether such liability is asserted by the Company or by
      creditors of the Company.

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    8.      
            Miscellaneous.

    

    (a)           Representations
      by the Company. The Company is a corporation duly organized, validly
      existing and in good standing under the laws of the State of
      Delaware.  The Company has all necessary corporate power and authority
      to carry on its business as now conducted.  The Company has all
      necessary corporate power and authority to execute and deliver this Warrant
      Agreement and to consummate the transactions contemplated hereby.  The
      execution and delivery of this Warrant Agreement and consummation of the
      transactions contemplated hereby have been duly authorized by all necessary
      corporate action on the part of the Company and no other corporate proceedings
      on the part of the Company are necessary to authorize this Warrant Agreement
      or
      to consummate the transactions contemplated hereby.  No further
      approval or authority of the board of directors or stockholders of the Company
      will be required for the issuance and sale of the Warrant Shares to be issued
      by
      the Company as contemplated herein.  This Warrant Agreement has been
      duly and validly executed and delivered by the Company and constitutes a valid,
      legal and binding agreement of the Company, enforceable against the Company
      in
      accordance with its terms.

    

    (b)           Successors
      and Assigns.  This Warrant Agreement shall be binding on and inure
      to the benefit of the Holder and the Company and their respective successors
      and
      assigns.

    

    (c)           Amendments
      and Waivers.  This Warrant Agreement and any provision hereof may
      be amended, changed, waived, discharged or terminated only by an instrument
      in
      writing signed by both parties hereto.

    

    (d)           Loss,
      Theft, Destruction or Mutilation.  Upon receipt by the Company of
      evidence reasonably satisfactory to it that this Warrant Agreement has been
      lost, stolen, destroyed or mutilated, and in the case of any lost, stolen or
      destroyed Warrant Agreement, an indemnity reasonably satisfactory to the
      Company, or in the case of a mutilated Warrant Agreement, upon surrender and
      cancellation hereof, the Company will execute and deliver in the name of the
      registered holder of this Warrant Agreement, in exchange and substitution for
      the Warrant Agreement so lost, stolen, destroyed or mutilated, a new Warrant
      Agreement of like tenor and amount.

    

    (e)           Warrant
      Exchangeable for Different Denominations.  This Warrant Agreement
      is exchangeable, upon the surrender hereof by the Holder at the principal office
      of the Company for new Warrant Agreements of like tenor representing in the
      aggregate the right to purchase the number of shares which may be purchased
      hereunder, each of such new Warrant Agreements to represent the right to
      purchase such number of Warrant Shares as shall be designated by said Holder
      hereof at the time of such surrender.

    

    (f)           Law
      Governing.  This Warrant Agreement will be governed by, and
      construed and enforced in accordance with, the laws of the State of North
      Carolina, without regard to conflicts-of-laws principles that would require
      the
      application of any other law.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    (g)           Entire
      Agreement.  This Warrant Agreement, together with the Purchase
      Agreement, the Registration Rights Agreement, and the other transaction
      documents referred to therein or contemplated thereby, constitutes the full
      and
      entire understanding and agreement among the parties with regard to the subject
      matter of this Warrant Agreement, and supersedes all prior agreements,
      understandings, inducements or conditions, express or implied, oral or written,
      with respect to the subject matter of this Warrant Agreement including without
      limitation, the Prior Warrant Agreement, which is hereby terminated in its
      entirety.

    

    (h)           Notices.  Unless
      otherwise provided herein, all notices, requests, demands and other
      communications required or permitted under this Warrant Agreement shall be
      in
      writing and will be deemed to have been duly made and received:  (i)
      upon personal delivery; (ii) three (3) Business Days after deposit with the
      United States Post Office, by registered or certified mail or by first class
      mail, postage prepaid, addressed as set forth below; or (iii) one (1) Business
      Day after deposit with a nationally recognized, overnight courier (for next
      business day delivery), shipping prepaid, addressed as set forth
      below:

    

    
      	
              If
                to Company:

            	
              OrthoLogic
                Corp.

            
	 	
              1275
                West Washington Street

              Tempe,
                Arizona 85281

              Attn:  Chief
                Executive Officer

              Facsimile:
                (602) 470-7080

            
	
               

            	 
	
              With
                a copy to

              (which
                shall not

              constitute
                notice):

            	 
              
              Quarles
                & Brady Streich Lang LLP

            
	 	
              One
                Renaissance Square

              Two
                North Central Avenue

              Phoenix,
                Arizona 85004

              Attn:
                Steven P. Emerick

              Facsimile:  (602)
                417-2980

            
	 	 
	
              If
                to Purchaser:

            	
              PharmaBio
                Development Inc.

            
	 	
              (d/b/a
                NovaQuest)

              4709
                Creekstone Drive

              Suite
                200 Riverbirch Building

              Durham,
                NC 27703

              Attn:  President

              Facsimile:  (919)
                998-2090

            

    

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    
      	
              With
                a copy to 

              (which
                shall not

               constitute
                notice):

            	 
              
              Smith,
                Anderson, Blount, Dorsett

            
	
               

            	
              Mitchell
                & Jernigan, L.L.P.

              2500
                Wachovia Capitol Center

              Raleigh,
                NC 27601

              Attn:
                Christopher B. Capel

              Facsimile:  (919)
                821-6800

            

    

    

    Either
      party may change the address to which communications are to be sent by giving
      five (5) Business Days’ advance notice of such change of address to the other
      party in conformity with the provisions of this Section.

    

    (i)           Execution;
      Counterparts.  This Warrant Agreement and any amendment hereto may
      be executed in counterparts, each of which when executed and delivered shall
      be
      deemed to be an original and all of which counterparts taken together shall
      constitute but one and the same instrument.  The exchange of copies of
      this Warrant Agreement or amendments thereto and of signature pages by facsimile
      transmission or by email transmission in portable digital format, or similar
      format, shall constitute effective execution and delivery of such instrument(s)
      as to the parties and may be used in lieu of the original Warrant Agreement
      or
      amendment for all purposes.  Signatures of the parties transmitted by
      facsimile or by email transmission in portable digital format, or similar
      format, shall be deemed to be their original signatures for all
      purposes.

    

    [signature
      page follows]

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

     [Signature
      Page to Amended and Restated Class C Warrant Agreement]

    

    IN
      WITNESS WHEREOF, the parties have
      caused this Warrant Agreement to be duly executed and delivered as of the day
      and year first written above.

    

    

    
      	 	
              ORTHOLOGIC
                CORP.

            
	 	 	 
	 	 	 
	 	
              By:

            	
              /s/
                Les M. Taeger

            
	 	
              Name:

            	
              Les
                M. Taeger

            
	 	
              Title:

            	
              Sr.VP
                and Chief Financial Officer

            
	 	 	 
	 	 	 
	 	
              PHARMABIO
                DEVELOPMENT INC.

            
	 	
              (D/B/A
                NOVAQUEST)

            
	 	 	 
	 	 	 
	 	
              By:

            	
              /s/
                Patrick B. Jordan

            
	 	
              Name:

            	
              Patrick
                B. Jordan

            
	 	
              Title:

            	
              Vice
                President, Corporate Development

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    ANNEX
      A

     

    EXERCISE
      FORM

    

    TO
      BE
      EXECUTED BY THE REGISTERED HOLDER

    TO
      EXERCISE THE ATTACHED

    AMENDED
      AND RESTATED CLASS C WARRANT AGREEMENT OF

    

    ORTHOLOGIC
      CORP.

    

    The
      undersigned, [________________],
      pursuant to the provisions of the Class C Warrant Agreement between OrthoLogic
      Corp. (the “Company”) and PharmaBio Development Inc. dated as of February 24,
      2006, as amended and restated on June __, 2006 (the “Warrant Agreement”), hereby
      elects to exercise the Warrant Agreement by agreeing to subscribe for and
      purchase [_______________] shares (the “Warrant Shares”) of Common Stock, $.0005
      par value per share, of the Company, and hereby makes payment of $[___________]
      by certified or official bank check or wire transfer of immediately available
      funds payable to the order of the Company in payment of the exercise price
      therefor.

    

    The
      undersigned acknowledges that the
      sale, transfer, assignment or hypothecation of the Warrant Shares to be issued
      upon exercise of this Warrant Agreement is subject to the terms and conditions
      of the Warrant Agreement.

    

    
      	 	
              PharmaBio
                Development Inc.

            
	 	
              (d/b/a
                NovaQuest)

            
	 	 	 
	 	
              By:

            	
               

            
	 	
              Name:

            	
               

            
	 	
              Title:

            	
               

            
	 	 	 
	 	 	 
	 	
              Address:

            	
              4709
                Creekstone Drive

            
	 	 	
              Suite
                200 Riverbirch Building

            
	 	 	
              Durham,
                NC 27703

            
	 	 	 
	
              Dated:
                ___________________, _____ex10_2.htm

    
      

    

    

      Exhibit
        10.2

      

      [*Designates
        portions of this document have been omitted pursuant to a request for
        confidential treatment filed separately with the
        Commission]

      

      

      PRIVATE
        LABEL SUPPLY AGREEMENT

      AND
        STRATEGIC ALLIANCE

      

      

      This
        Private Label Supply Agreement and Strategic Alliance (“Agreement”), dated
        August 25, 2005 (“Effective Date”), is entered into by NutraCea, a California
        corporation (“NUTRA”), and ITV Global, a Nevada corporation
        (“ITV”).

      

      Recitals

      

      A.           NUTRA
        is engaged in the business of producing and selling various types of nutritional
        products.

      

      B.           ITV
        is engaged in the business of marketing and selling various types of products
        via Direct Response advertising.

      

      C.           ITV
        and NUTRA desire that ITV purchase from NUTRA, and NUTRA sell to ITV, upon
        and
        subject to the terms and conditions set forth in this Agreement, certain
        products mentioned herein.

      

      D.           ITV
        and NUTRA desire that ITV exclusively market and distribute world-wide certain
        products labeled and marketed as the “Rice Patty” collection, as described
        herein.

      

      

      Agreement

      

      Whereas,
        the parties agree and understand that this Agreement shall supersede any
        and all
        prior written or oral agreements previously entered into;

      

      In
        consideration of the foregoing recitals and the mutual covenants set forth
        in
        this Agreement, ITV and NUTRA agree as follows:

      

      1.    Definitions.  As
        used in this Agreement, the following terms shall have the following
        meanings:

      

      1.1    Affiliate.  “Affiliate”,
        when used with reference to a specified Person, shall mean (a) the natural
        person in ultimate control of such Person; and (b) any Person directly or
        indirectly controlling, controlled by or under common control with such
        Person.

      

      1.2    Aggregate
        Units.  Aggregate
        units shall mean a combination of all the Products mentioned
        herein.

      
        
          
          

        

        
          1

          
            

          

        

        
          
          

        

      

       

      1.3    Contract
        Quarter.  “Contract Quarter” shall mean each three (3)
        month period beginning on October 1 and ending on December 31, each three
        (3)
        month period beginning on January 1 and ending on March 31, each three (3)
        month
        period beginning on April 1 and ending on June 30, and each three (3) month
        period beginning on July 1 and ending on September 30.

      

      1.4    Contract
        Quarter Minimum.  “Contract Quarter Minimum” shall have
        the meaning specified in Section 2.6.

      

      1.5    Contract
        Year.  “Contract Year” shall mean each twelve month
        period beginning on Effective Date and ending on 12 months from the Effective
        Date .

      

      1.6    Direct
        Response Marketing.  Shall mean any and all Product
        advertising existing now or developed for the Product line during the term
        of
        this Agreement, including but not limited to infomercials, radio advertisements,
        print advertisement, package inserts, network marketing, insert programs
        and
        internet marketing.

      

      1.7    Force
        Majeure Event.  “Force Majeure Event” shall have the
        meaning specified in Section 12 below.

      

      1.8    Initial
        Order.  “Initial Order” shall have the meaning specified
        in Section 2.6.

      

      1.9    ITV
        Marks.  “ITV Marks” shall mean all trademarks and logos
        owned or claimed by ITV.

      

      1.10   
          Minimum
        Quantity.  “Minimum Quantity” shall have the meaning set
        forth in Section 2.6.

      

      1.11   
          Non-Conforming
        Product.  Shall mean any product that does not meet
        ordinary reasonable merchantable standards.   By way of example
        but not limited to, Non-Conforming products shall mean incorrect amount of
        product per bottle, label incorrectly placed on bottle, improper seal, incorrect
        formula, no accompanying certificate of analysis.

      

      1.12   
          NUTRA
        Marks.  “NUTRA Marks” shall mean all trademarks, service
        marks, and other marks or logos owned or claimed by NUTRA.  The
        parties agree that NUTRA owns and shall retain all right, title and interest
        in
        the NUTRA Marks, including without limitation the “Rice Patty” trademark and the
        NutraCea logos, including without limitation the Caduceus logo.

      

      1.13   
          Person.  “Person”
        shall mean any individual, partnership, joint venture, corporation, trust,
        unincorporated organization or other entity.

      

      1.14   
          Products.  “Products”
        shall mean only those products from the “Rice Patty” collection listed on
Exhibit A attached to this Agreement.  “Products” shall not
        include similar or identical products or product formulations, sold and marketed
        by Nutra or any third parties under different names or labels.

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

       

      1.15   Product
        Cost.  Product cost shall mean the total
        cost to manufacture, assemble, and prepare each product for
        market.  Such cost shall include, but not be limited to, costs of
        encapsulating, bottling and blending the raw materials, costs of packaging
        and
        the other direct and actual costs to NUTRA of manufacturing, assembling,
        and
        preparing the Products for market.  Product Cost shall be determined
        as of the date of the applicable purchase order for the Product.  The
        Product Cost for SRB shall be the lowest wholesale price at which the SRB
        is
        commercially sold by NUTRA at any place in the United States of
        America.

      

      1.16   SRB.  “SRB”
        shall mean stabilized rice bran derivatives.

      

      1.17   Transferred
        Marks.  Transferred Marks means the tradenames
“Flex Protex” and “Rice ‘N’ Shine.”

      

      2.    Purchase
        and Sale of Products.

      

      2.1    Sale
        of Products by NUTRA.  During the term of this Agreement,
        NUTRA will exclusively, subject to Sections 2.6 and 3 below, sell to ITV,
        upon
        and subject to the terms and conditions set forth in this Agreement, such
        quantities of Products as ITV may order from time to time.

      

      2.2            Packaging;
        Labels.  The Products to be purchased and sold under this
        Agreement will be packaged in such packaging and will bear such ITV Marks
        and
        NUTRA Marks as is mutually agreed upon by the parties.  NUTRA agrees
        to private label certain Products exclusively for ITV. ITV shall be responsible
        for all costs and expenses relating to the creation and printing of the labels
        for the Products and all costs and expenses incurred to affix the labels
        to the
        Products.

      

      2.3            Production.  ITV
        reserves the right to reject any Non-Conforming Product from the manufacturer
        selected by the parties pursuant to Section 2.4 and shall notify both NUTRA
        and
        the manufacturer of any such defects.  ITV will notify NUTRA of such
        as soon as reasonably possible.  The parties shall instruct such
        manufacturer that all shipments of Product must have an accompanying certificate
        of analysis.  NUTRA shall provide the manufacturer with a certificate
        of analysis for its SRB for each shipment to the manufacturer.

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

       

      2.4            Fulfillment
        of Product.  NUTRA shall contract with one or more third
        party manufacturer(s) to manufacture, assemble, package, and label the
        Products.  The manufacturer shall be a company selected in writing by
        NUTRA.  The manufacturer must be able to supply Product of at least
        equal quality to the Product currently supplied by NUTRA.  The
        manufacturer shall be obligated to obtain the “RiSolubles” and other SRB
        derivatives from NUTRA, and shall utilize the same Product formulations and
        raw
        material sources of supply as currently utilized by NUTRA, without variations,
        except to the extent expressly approved by NUTRA in advance and in writing.
        Such
        manufacturer shall contract directly with NUTRA to provide the Product and
        shall
        ship the Product to ITV in accordance with all ITV purchase orders to NUTRA
        issued pursuant to this Agreement. ITV shall not place orders directly with
        the
        manufacturer. ITV shall enter into a written agreement with the manufacturer
        to
        guaranty payment for all Product produced pursuant to the manufacturing
        agreement and such guaranty shall be the sole recourse of
        the manufacturer in the event of a payment default under the manufacturing
        agreement.  The current and future manufacturer must accept ITV as the
        sole source of payment under the manufacturing agreement and must agree to
        be
        paid for each shipment * days following shipment of the Product
        order.   During the term of this Agreement the parties agree to
        evaluate alternate manufacturing options, subject to approval by NUTRA in
        its
        sole discretion.  If, at any time in the future, NUTRA agrees to
        utilize a manufacturer approved by ITV and that manufacturer does not agree
        to
        accept ITV as the sole source of payment under the manufacturing agreement,
        ITV
        shall pay for the Product on alternate payment terms that protect NUTRA from
        liability for the manufacturing costs. All manufacturers must enter into a
        nondisclosure and non-circumvention agreement in a form acceptable to NUTRA
        prior to obtaining proprietary Product Information, submitting bids, or
        commencement of any manufacturing activities.

      

      2.5            Order
        Procedure.  ITV’s orders for quantities of Products
        purchased under this Agreement will be placed by ITV by means of purchase
        orders
        delivered to NUTRA, each of which shall reference this
        Agreement.  Each such purchase order must specify a shipment date that
        is not less than forty five (45) days from the date of such purchase
        order.  NUTRA shall have no responsibility for any delays or failures
        resulting from the manufacturer approved by ITV pursuant to Section 2.4.NUTRA
        agrees to fulfill all purchase orders for the SRB within six (6) weeks of
        receiving the purchase order. ITV may issue a standing order to NUTRA, and
        each
        shipment or installment shall be severable and a distinct purchase order
        from
        each other.  Each purchase order form shall specify the Product name,
        formulation, number of Product units, order date and price and shall comply
        with
        the terms and conditions of this Agreement, and the terms hereof shall supersede
        any contrary terms contained in any purchase order.  All purchase
        orders shall be in a form and content specifically approved in advance by
        NUTRA.   Except as provided or permitted herein, the purchase
        order shall not include any additional or pre-printed terms or
        conditions.

      

      2.6            Minimum
        Quantity.  During the term of this Agreement, after the
        Initial Order (defined below), ITV agrees to order and purchase not less
        than *
        Aggregate Units of the Products per purchase order, except for *, which shall
        have a minimum order amount of * (“Minimum Quantity”).  In addition to
        the Minimum Quantity, ITV agrees to purchase during the term of this Agreement
        a
        minimum of * Dollars ($*) worth of Product each Contract Quarter (“Contract
        Quarter Minimum”). The Contract Quarter Minimum requirement shall be determined
        by the sum of all Products ordered at the prices set forth in each purchase
        order.  Notwithstanding the foregoing, ITV’s initial order, which
        may be shipped in installments from the manufacturer, shall be for no less
        than
        a total of * Dollars ($*) of * (the “Initial Order”).

      

      2.7            Cancellation.  NUTRA
        shall not be obligated to accept, and ITV shall not be entitled to request
        any
        delays in delivery or to cancel any purchase order placed by ITV; provided,
        that
        if a governmental agency notifies ITV in writing that it objects to ITV’s
        performance of its obligations under this Agreement, then ITV shall be entitled
        to cancel any open purchase orders upon delivery to NUTRA of written proof
        of
        the notice of governmental objection. Notwithstanding the foregoing, ITV
        shall
        make all outstanding payments for amounts due to the manufacturer arising
        from
        any cancelled order.

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

       

      2.8            Shipments.  All
        Products purchased by ITV under this Agreement will be shipped FOB the
        manufacturer’s designated facility and risk of loss will pass to ITV upon
        shipment.  ITV will pay all shipping costs.

      

      2.9    Invoicing;
        Terms of Payment.

      

      (a)  Except
        as
        provided in Section 2.9(b) below, the terms of payment shall be * days from
        the
        date of shipment of the Product from the manufacturer.  Any amount not
        paid when due shall accrue an additional * percent (*%) per month until
        paid.  Each payment shall be payable directly into an escrow account
        established by NUTRA with Weintraub Genshlea Chediak law corporation or an
        escrow holder reasonably acceptable to ITV and the deposited funds shall
        be used
        to immediately make payment to the manufacturer and the balance distributed
        to
        NUTRA.  All other amounts due hereunder shall be paid directly to
        NUTRA.

      

      (b)  Notwithstanding
        the provisions of Section 2.9(a), ITV’s payment to NUTRA for all ordered Product
        other than the Initial Order shall be due no later than the earlier of (i)
        the
        time required under Section 2.9(a), and (ii) * days after the date of the
        applicable Product purchase order.

      

      (c)  For
        the
        Initial Order, ITV agrees to receive a minimum shipment of * of the Initial
        Order on or before each of the following dates: September 30, 2005 and an
        additional * of the Initial Order on each of the October 31, 2005, December
        31,
        2005, January 30, 2006 and February 28, 2006.  Provided that the
        required Product is ready for shipment on each of these dates, ITV shall
        pay for
        the Product on the earlier of * days after shipment or * days after each
        of
        these dates (whether or not the shipment occurs).  Notwithstanding the
        foregoing, if on any Initial Order shipment date the Product is not ready
        for
        shipment and the delay is not caused by ITV, payment shall not be due until
        *
        days after the date that the Product is available for shipment.

      

      3.          Exclusivity
        Granted to ITV.  During the term of this Agreement, so
        long as ITV meets the Contract Quarter Minimum, NUTRA or its successors,
        assigns
        or designees will not market, distribute or sell the Products to any other
        entity and ITV shall be granted the exclusive worldwide license to market
        and
        distribute all of the Products.  Notwithstanding the foregoing, NUTRA,
        or its designees may manufacture, distribute, market and/or sell similar
        or
        identical products under different names or labels. In the event that ITV
        does
        not meet the Contract Quarter Minimum, and fails to cure such default within
        thirty (30) days after the end of the Contract Quarter in which the Contract
        Quarter Minimum was not met, this Agreement shall become non-exclusive and
        NUTRA
        may sell the Products bearing NUTRA Marks to other parties in its sole
        discretion.

      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

       

      4.        
        Prices.

      

      4.1            Prices.  NUTRA
        will mark up the Product by * percent (*%) of the total finished Product
        Cost.  The manufacturer selected under Section 2.4 above shall be
        directed to provide ITV and NUTRA true and correct duplicate copies of all
        invoices submitted by the manufacturer for producing the Product. In no event
        will NUTRA sell the Products at a mark up greater than * percent (*%) of
        the
        actual Product Cost and in no event will ITV purchase the Products at a mark
        up
        less than * percent (*%) of the actual Product Cost.  The parties
        agree and understand that the prices are subject to change due to changes
        in
        manufacturing and other direct costs, volume and manufacturing discounts
        and
        minimum requirements, increase in raw material costs, changes in formula
        modifications or otherwise.  The prices on the Initial Purchase Order
        and subsequent purchase orders shall be determined as of the date of the
        purchase order and applied to the obligations of the Contract Quarter
        Minimums.

      

      4.2            Raw
        Materials.  NUTRA agrees that if the cost of the SRB
        becomes less expensive to NUTRA then it will pass those savings on to ITV
        and if
        the cost of the SRB becomes more expensive then it will notify ITV in writing,
        within thirty (30) days (or as soon as reasonably available, if less) prior
        to
        the increase of the costs to ITV, all in accordance with this
        Agreement.

      

      5.          Obligations
        of ITV.

      

      5.1            Purchase
        Forecasts.  ITV will use its best efforts to deliver to
        NUTRA a written forecast setting forth ITV’s good faith estimate of ITV’s
        anticipated purchases of Products for that Contract Quarter, by month on
        a
        Product-by-Product basis.  Such forecasts will not be binding on ITV,
        but ITV will use its best efforts to ensure the accuracy of the
        same.

      

      5.2            Compliance
        with Law.  ITV will comply with all applicable laws,
        statutes and regulations relating to the marketing, distribution and sale
        of
        Products purchased by it under this Agreement. NUTRA will also comply with
        all
        applicable laws, statutes and regulations relating to the manufacturing of
        nutritional products and dietary supplements and abide by good manufacturing
        practices.

      

      5.3            Marketing
        and Sales Efforts.  Throughout the term of this
        Agreement, ITV shall use its best efforts to market, distribute and sell
        Products bearing one or more of ITV’s  and NUTRA’s Marks, including
        but not limited to Direct Response Marketing.  Upon signing this
        Agreement and until the termination of this Agreement, NUTRA shall maintain
        on
        its website (www.nutracea.com) a link to the ITV website and NUTRA shall
        not sell any Product other than by directing customers to the ITV
        website.

      

      5.4            Up-Selling.  ITV
        agrees to up-sell the Products first before attempting to up-sell any non
        NUTRA
        products.  ITV will not be prohibited from up-selling any of its
        products with NUTRA Products.

      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

       

      6.         Issuance
        of Securities.  NUTRA agrees to issue to ITV or its
        designees an option to acquire up to two hundred and fifty thousand (250,000)
        shares of NUTRA restricted common stock at the average of the “bid” and “ask”
market price on the Effective Date, as follows: options to acquire and vest
        fifty thousand (50,000) shares upon payment in full of the first Contract
        Quarter Minimum, and fifty thousand (50,000) for each Contract Quarter during
        the term of this Agreement in which ITV purchases and pays in full in accordance
        with the terms and conditions of this Agreement, the Contract Quarter Minimum,
        until the aggregate total of options granted under this Section equals two
        hundred fifty thousand (250,000).  ITV shall have a thirty (30) day
        right after the end of each Contract Quarter during the term of this Agreement
        to cure any shortfall in failing to purchase the Contract Quarter Minimum
        for
        the prior Contract Quarter; and if ITV cures any such shortfall it shall
        vest in
        the options. NUTRA shall have no further obligations under this Section to
        grant
        options to ITV upon ITV receiving options to purchase an aggregate total
        of two
        hundred fifty thousand (250,000) shares of NUTRA restricted common
        stock.  If necessary, the parties agree to amend this Section of the
        Agreement in order to comply with all applicable state and federal securities
        law.  In the event of a breach by ITV of any monetary obligation
        hereunder, any and all rights of ITV to any options hereunder that have not
        yet
        vested shall immediately terminate and be of no further force or
        effect.  All options issued under this Section shall include a lock-up
        restriction, prohibiting the sale of the underlying security until December
        31,
        2007, except in the event of an acquisition of all or substantially all of
        the
        assets of NUTRA to an unrelated third party, at which time the lock-up shall
        terminate, and all options will vest and be available for exercise and sale
        at
        the time the acquisition is completed.

      

      7.        
        INTELLECTUAL PROPERTY.

      

      7.1            Marks.  NUTRA
        will not use any ITV Mark in connection with the marketing, distribution
        or sale
        of any of the Products unless expressly authorized in writing by
        ITV.  ITV will not use any NUTRA Marks in connection with the
        marketing, distribution or sale of any Products unless expressly authorized
        hereunder or in a separate writing by NUTRA.  All Product names listed
        on Exhibit A are NUTRA Marks; provided, that after five (5) Contract Quarters,
        and if ITV has not breached any of its monetary or other obligations hereunder,
        NUTRA agrees to convey all of its right and interest in the Transferred Marks
        to
        ITV and such marks shall thereafter be ITV Marks.

      

      7.2            Labels
        and package design.  All private labels and packaging
        (excluding any NUTRA Marks) developed by NUTRA and exclusively created for
        ITV
        shall be “work for hire” and owned by ITV.

      

      7.3            Infomercial. The
        entire editorial, visual, audio and graphic content of all advertisements
        and
        promotional materials developed by ITV in connection with the promotion,
        marketing and distribution of the Product(s), including without limitation,
        (i)
        the programs and the performances recorded therein, the promotional segments,
        and any other marketing materials prepared in connection with the Product(s),
        (ii) all raw footage shot in the course of producing the programs, (iii)
        all
        trademarks developed for ITV or its affiliates, (iv) all musical compositions
        included in the programs, and shall be and remain the sole property of ITV,
        (v)  and any developed web domains for the Products (“ITV Intellectual
        Property”).   NUTRA shall not acquire any right, title or
        interest in the ITV Intellectual Property by virtue of this Agreement or
        otherwise.  NUTRA hereby assigns and agrees to assign to ITV all of
        NUTRA’s right, title and interest in the ITV Intellectual Property mentioned in
        this Section 7.3 and Section 7.2 above.  NUTRA shall not in any way or
        at any time dispute or attack the validity or harm or contest the rights
        of ITV
        in or to any of the ITV Intellectual Property.  Any unauthorized use
        of any of the ITV Intellectual Property by NUTRA shall be deemed an infringement
        of the rights of ITV therein.

      
        
          
          

        

        
          7

          
            

          

        

        
          
          

        

      

       

      7.4           NUTRA
        Intellectual Property.  During the term of this
        Agreement, NUTRA hereby grants to ITV a world wide, royalty-free license
        to use
        all NUTRA trade marks, copyrights, service marks, and logos provided by NUTRA
        for the Products (specifically not including any trade secrets, patented
        items,
        or software items) solely for use for the Products and all proprietary marks
        of
        NUTRA solely for use for the Products in conjunction with ITV’s performance
        under this Agreement. ITV shall have no right to use any other copyrighted
        materials or proprietary marks of NUTRA. This license or rights granted per
        this
        Section 7.4 shall not be assignable unless agreed upon by NUTRA.

      

      7.5            Confidentiality.  All
        customer lists, price lists, written and unwritten marketing plans, techniques,
        methods and data, sales and transaction data, and other information designated
        or deemed either by NUTRA or ITV as being confidential or a trade secret,
        shall
        constitute confidential information of or NUTRA or ITV, as applicable
        (“Confidential Information”).  NUTRA and ITV shall
        hold all Confidential Information in the strictest confidence and shall protect
        all Confidential Information with the same degree of care that NUTRA and
        ITV
        exercises with respect to its own proprietary information.  Without
        the prior written consent of the other, NUTRA or ITV shall not use, disclose,
        divulge or otherwise disseminate any Confidential Information to any person
        or
        entity, except for each party’s attorneys and such other professionals as the
        companies may retain in order for it to enforce the provisions of this
        Agreement.  Notwithstanding the foregoing NUTRA and ITV shall have no
        obligation with respect to any Confidential Information which (i) is or becomes
        within the public domain through no act of NUTRA or ITV in breach of this
        Agreement, (ii) was lawfully in the possession of NUTRA or ITV without any
        restriction on use or disclosure prior to its disclosure hereunder, (iii)
        is
        lawfully received from another source subsequent to the date of this Agreement
        without any restriction on use or disclosure, or (iv) is required to be
        disclosed by order of any court of competent jurisdiction or other government
        authority (provided in such latter case, however, that each
        company  shall timely inform the other of all such legal or
        governmental proceedings so that the company may attempt by appropriate legal
        means to limit such disclosure, and NUTRA and ITV shall further use its best
        efforts to limit the disclosure and maintain confidentiality to the maximum
        extent possible).

      

      7.6            Non-Circumvention.  During
        the term of this Agreement and for a period of one (1) year thereafter, ITV
        shall not, directly or indirectly, transact business directly with any
        manufacturer, supplier or producer of the Products that ITV becomes aware
        of as
        a result of this Agreement without NUTRA’s prior written consent.  The
        provisions of this Section 7.6 shall be deemed to consist of a series of
        separate covenants for each Product.  The parties agree that the one
        (1) year restricted period and the proscribed activities during such one
        (1)
        year period are reasonable in light of the relevant circumstances as of the
        date
        of this Agreement.  If any such period or activity are adjudged
        unreasonable in any final decision of a judge or arbitrator or administrative
        agency of competent jurisdiction, then the period or activity shall be reduced
        to the extent that they are determined to be unreasonable, so that this covenant
        may be enforced with respect to the maximum amount of such
        activities  and during the maximum time period as is adjudged to be
        reasonable.

      
        
          
          

        

        
          8

          
            

          

        

        
          
          

        

      

       

      8.          Warranty,
        Etc.

      

      8.1            Limited
        Warranty.  NUTRA warrants that all Product ingredients
        supplied by NUTRA are generally recognized as safe for human consumption
        as
        formulated.  NUTRA further warrants that it is and has complied with
        all relevant laws, rules and regulations promulgated by the Food and Drug
        Administration.

      

      8.2            Remedies
        for Breach of Warranty.  In the event of a breach of the
        warranty set forth in Section 8.1 above, NUTRA shall be obligated to either,
        in
        ITV’s sole discretion, (i) replace the Non-Conforming Products; or (ii) refund
        the price paid by ITV for the Non-Conforming Products.

      

      8.3            Disclaimer
        of Warranty.  NUTRA MAKES NO WARRANTIES OR
        REPRESENTATIONS AS TO THE PERFORMANCE OF THE PRODUCTS, EXCEPT AS SET FORTH
        IN
        SECTION 8.1 ABOVE. ALL IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS
        FOR A
        PARTICULAR PURPOSE, ARE HEREBY EXCLUDED.

      

      8.4            Consequential
        Damages Waiver.  IN NO EVENT WILL EITHER PARTY BE LIABLE
        OR RESPONSIBLE FOR ANY TYPE OF INCIDENTAL, PUNITIVE, INDIRECT OR CONSEQUENTIAL
        DAMAGES, INCLUDING, BUT NOT LIMITED TO, LOST REVENUE, OR LOST PROFITS, EVEN
        IF
        ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, ARISING OUT OF OR RELATING TO
        THE
        PRODUCTS, THIS AGREEMENT, OR ANY PERFORMANCE OR NON-PERFORMANCE BY EITHER
        PARTY
        UNDER THIS AGREEMENT, WHETHER ARISING UNDER A THEORY OF BREACH OF WARRANTY,
        CONTRACT, TORT (INCLUDING NEGLIGENCE), STRICT LIABILITY OR
        OTHERWISE.

      

      8.5            Limitation
        of Liability.  In no event will NUTRA have any liability
        or obligation to ITV arising out of or related to the Products, this Agreement
        or the performance or non-performance of NUTRA under this Agreement, in an
        amount greater than the aggregate amount actually paid by ITV to NUTRA for
        the
        Products with respect to which such alleged liability or obligation
        relates.

      

      8.6            Insurance.  For
        so long as ITV continues to sell the Product(s), NUTRA shall maintain, at
        its
        own expense, a blanket liability insurance coverage, including, but not limited
        to, coverage for product liability for the Product in an amount not less
        than
        two million dollars ($2,000,000) in the aggregate and up to one million dollars
        ($1,000,000) per incident.  ITV shall be named as an additional
        insured on any such policies.  All such insurance shall be placed with
        one or more carriers, which are rated "A" or better by A. M. Best's rating
        service.  NUTRA shall deliver to ITV evidence of (i) the procurement
        of such insurance including evidence showing ITV has been named an additional
        insured in a form reasonably acceptable to ITV within fifteen (15) days of
        such
        procurement and (ii) maintenance of such insurance in a form reasonably
        acceptable to ITV at each renewal period and at such times as are requested
        by
        ITV.  ITV shall be provided no less than thirty (30) days prior
        written notice from NUTRA and its insurer of cancellation of such
        policy.  The costs associated with the NUTRA Insurance shall be
        reimbursed by ITV within five (5) business days of presentment of the invoice
        from the insurance company.

      
        
          
          

        

        
          9

          
            

          

        

        
          
          

        

      

       

      9.         Indemnification.

      

      9.1            Indemnification
        by NUTRA.  NUTRA will defend, indemnify and hold ITV and
        its Affiliates, and their respective officers, directors and employees (the
        “Indemnified Parties”) harmless from and against, and will reimburse the
        Indemnified Parties with respect to, any and all claims, actions, demands,
        losses damages, liabilities, costs and expenses, including without limitation
        attorneys’ fees, which the Indemnified Parties, or any of them, may suffer or
        incur arising, directly or indirectly, out of (a) the allegation by any third
        Person that the Products infringe upon any United States patent; or (b) any
        claim brought against ITV by a state or federal governmental agency arising
        out
        of its conduct as permitted and contemplated under this Agreement, except
        in
        each case to the extent arising from the gross negligence or intentional
        misconduct of ITV or its employees or agents.

      

      9.2            Indemnification
        by ITV.  ITV will defend, indemnify and hold NUTRA, its
        Affiliates, and their respective officers, directors and employees (“NUTRA
        Indemnified Parties”) harmless from and against, and will reimburse the NUTRA
        Indemnified Parties with respect to any and all claims, actions, demands,
        losses
        damages, liabilities, costs and expenses, including without limitation,
        attorneys fees, which the NUTRA Indemnified Parties, or any of them may suffer
        or incur arising, directly or indirectly, out of  ITV’s breach of any
        of its obligations under this Agreement, except to the extent arising from
        the
        gross negligence or intentional misconduct of NUTRA or its employees or
        agents.

      

      9.3            Indemnification
        Procedure.  Any party claiming indemnification under this
        Agreement (“Indemnified Party”) shall provide the other party (the “Indemnifying
        Party) prompt notice in writing upon becoming aware of any action, suit,
        proceeding, claim, demand, judgment or assessment with respect to which a
        right
        to indemnification is claimed under Section 9.1 or 9.2 (a
“Claim”).  The Indemnifying Party shall thereupon have the right to
        assume control of the defense and/or settlement of the Claim, provided that
        (a)
        the Indemnifying Party promptly undertakes such defense and/or settlement,
        and
        thereafter pursues the same with reasonable diligence; (b) the Indemnifying
        Party keeps the Indemnified Party reasonably informed of the progress of
        such
        defense and/or settlement; and (c) the Indemnifying Party does not compromise
        or
        settle the Claim without the Indemnified Party’s prior written consent, which
        consent will not be unreasonably withheld, conditioned or
        delayed.  The Indemnified Party may participate in the defense of a
        Claim at its own expense, however, Indemnified Party’s participation shall be
        solely as an observer.

      

      10.       Relationship
        of Parties. This Agreement does not constitute ITV as a
        partner, joint venturer, agent or legal representative of NUTRA, or NUTRA
        as a
        partner, joint venturer, agent or legal representative of ITV for any purpose
        whatsoever.  Neither party grants any express or implied right or
        authority to the other party to assume or create any obligation or
        responsibility on behalf of or in the name of the other party, or to bind
        the
        other party in any matter or thing whatsoever.

      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

       

      11.       Termination.

      

      11.1   Termination
        by Either Party.  NUTRA and ITV shall each have the
        right, at its option, to terminate this Agreement as follows:

      

      (a)           By
        giving written notice to the other party, effective immediately, in the event
        that such other party shall be adjudicated bankrupt or shall petition for
        or
        consent to any relief under any bankruptcy, reorganization, receivership,
        liquidation, compromise, or any moratorium statute, whether now or hereafter
        in
        effect, or shall make an assignment for the benefit of its creditors, or
        shall
        petition for the appointment of a receiver, liquidator, trustee, or custodian
        for all or a substantial part of its assets, or if a receiver, liquidator,
        trustee or custodian is appointed for all or a substantial part of its assets
        and is not discharged within thirty (30) days after the date of such
        appointment; or

      

      (b)           Upon
        any default in the performance of or breach of any agreement, covenant,
        obligation or undertaking of the other party made in this Agreement (unless
        caused by a Force Majeure Event, which shall be governed by Section 12 below,
        or
        unless the default is a monetary default by ITV, which shall be governed
        by
        Section 11.2 below), if such default or breach is not remedied to the reasonable
        satisfaction of the party giving notice of termination within thirty (30)
        days
        after written notice of the default or breach has been given to the defaulting
        party by the other party.

      

      The
        notice of election to terminate this Agreement shall state the grounds upon
        which termination is based.

      

      11.2    Termination
        Based on Monetary Default by ITV.  Following written
        notice from NUTRA of a monetary default, ITV’s opportunity to cure such default
        will be seven (7) calendar days from receipt of notice.  If such
        monetary default is not cured within such time, then NUTRA shall have the
        right
        to immediately terminate this Agreement.

      

      11.3            Survival.  The
        provisions of Sections 2.9, 7.5, 7.6, 8 and 9, this Section 11.3, 11.4, and
        Section 13 shall survive the expiration or termination of this Agreement
        for any
        reason whatsoever.  Further, expiration or termination of this
        Agreement for any reason whatsoever shall not relieve or release either party
        hereto from any liabilities or obligations that it has incurred prior to
        the
        date of such expiration or termination.

      

      11.4            Effect
        of Termination. Upon termination of this Agreement, ITV shall cease
        marketing of the Products immediately. ITV shall return to NUTRA all NUTRA
        Confidential Information  in ITV’s possession on the date of
        termination. ITV shall have no further rights to the Products upon termination
        of this Agreement and ITV shall immediately cease airing any and all
        infomercials or commercials relating to or referencing the Products.  In
        the event of a breach by ITV of any of its obligations under this Agreement,
        which breach is not cured during any applicable cure period hereunder, all
        assignments by NUTRA pursuant to Section 7 herein shall be null and void
        and of
        no further force or effect.  The parties agree that upon termination
        for any reason other than a default or breach by ITV, NUTRA will sell to
        ITV any
        Product that ITV reasonably requires to fulfill continuity and re-orders
        from
        ITV’s customers.  NUTRA will not be obligated to sell any Product to
        ITV following any termination due to a default or breach by ITV
        hereunder.

      
        
          
          

        

        
          11

          
            

          

        

        
          
          

        

      

       

      12.        Force
        Majeure.  If either party is prevented from performing,
        or delayed in the performance of, any of its obligations under this Agreement,
        except the payment of money, because of an event beyond its reasonable control,
        such as, but not limited to, inability to obtain materials or labor, any
        act of
        God, riot, war, civil unrest, flood, fire or earthquake (but excluding failure
        caused by a party’s financial condition or negligence), the affected party shall
        be excused from performance (other than the payment of money due hereunder)
        for
        the duration of the event (a “Force Majeure Event”); provided that the party
        whose performance has been impaired by the Force Majeure Event (a) promptly
        notifies the other party of the existence and nature of the Force Majeure
        Event
        and its anticipated effect on the performance of the notifying party under
        this
        Agreement; (b) promptly undertakes and thereafter diligently pursues any
        commercially reasonable action necessary to remove the effect of the Force
        Majeure Event, to the extent that the Force Majeure Event in question is
        of a
        nature such that its effects may be remedied by commercially reasonable action;
        and (c) keeps the other party informed during the duration of such Force
        Majeure
        Event of all facts pertaining thereto, including but not limited to the progress
        of the notifying party in remedying the same, if applicable.

      

      13.        Miscellaneous.

      

      13.1            Arbitration.  In
        the event of any dispute or controversy arising out of or relating to this
        Agreement, the parties hereto agree to submit such dispute or controversy
        to
        binding arbitration.  The sole arbitrator shall be selected from the
        list of arbitrators supplied by the American Arbitration Association following
        written request by any party hereto.  If the parties hereto cannot
        agree upon an arbitrator within thirty (30) days following receipt of the
        list
        of arbitrators by all parties to such arbitration, then either party may
        request, in writing, that the American Arbitration Association appoint an
        arbitrator within ten (10) days following receipt of such request (the
“Arbitrator”).  If the arbitration is initiated by ITV, the
        arbitration shall take place in Sacramento County, California.  If the
        arbitration is initiated by NUTRA, the arbitration shall take place in Boston,
        Massachusetts.  Subject to the foregoing, the arbitration shall be
        held at a place and time mutually agreeable to the parties or if no such
        agreement is reached within ten (10) days following notice from the Arbitrator,
        at a place and time determined by the Arbitrator.  Such arbitration
        shall be conducted in accordance with the Commercial Arbitration Rules of
        the
        American Arbitration Association then in effect.  The parties hereto
        agree that all actions or proceedings arising in connection with this Agreement
        shall be arbitrated exclusively in Sacramento County, California or Boston
        Massachusetts, as applicable.  The aforementioned choice of venue is
        intended by the parties to be mandatory and not permissive in nature, thereby
        precluding the possibility of litigation or arbitration between the parties
        with
        respect to or arising out of this Agreement in any jurisdiction other than
        that
        specified in this Section.  Each party hereby waives any right it may
        have to assert the doctrine of forum non conveniens or similar doctrine or
        to
        object to venue with respect to any proceeding brought in accordance with
        this
        Section, and stipulates that the Arbitrator shall have in personam jurisdiction
        and venue over each of them for the purpose of resolving any dispute,
        controversy, or proceeding arising out of or related to this
        Agreement.  The decision of the Arbitrator shall be final and binding
        on all the parties to the arbitration, shall be non-appealable and may be
        enforced by any court of competent jurisdiction.  In addition to
        attorneys’ fees as provided herein, the prevailing party shall be entitled to
        recover from the non-prevailing party reasonable costs and
        expenses.  The costs and fees of the arbitration shall be paid by the
        non-prevailing party.  The Arbitrator may grant any remedy that the
        Arbitrator deems appropriate including, without limitation, injunctive relief
        or
        specific performance.  Prior to the appointment of the Arbitrator, any
        party may seek a temporary restraining order or a preliminary injunction
        that
        shall be effective until a final decision is rendered by the
        Arbitrator.

      
        
          
          

        

        
          12

          
            

          

        

        
          
          

        

      

       

      13.2    Assignment.  This
        Agreement may not be assigned by either party without the prior written consent
        of the other party; provided, however, that this Agreement may be assigned
        by
        NUTRA, without the prior written consent of ITV, to any Person which acquires
        all or substantially all of the assets of NUTRA.

       

      13.3    Applicable
        Law.  This Agreement shall be construed and interpreted
        in accordance with the internal laws of the State of California, notwithstanding
        its conflict of law provisions.

      

      13.4            Entire
        Agreement.  This Agreement embodies the entire agreement
        and understanding of the parties hereto with respect to the subject matter
        hereof.  No representation, promise, inducement, statement or
        intention has been made by any party hereof that is not embodied herein,
        and no
        party shall be bound or liable for any alleged representation, promise,
        inducement or statement not so set forth herein.  Terms and conditions
        set forth in any of ITV’s purchase orders, or any other forms or documents of
        ITV, which are inconsistent with, or in addition to, the terms and conditions
        set forth in this Agreement, are hereby objected to and rejected in their
        entirety, regardless of when received, without further action or notification
        by
        NUTRA, and shall not be considered binding on NUTRA unless specifically agreed
        to in writing by it.

      

      13.5            Severability.  If
        any provision of this Agreement or the application of any such provision
        to any
        party or any circumstances shall be determined by any court of competent
        jurisdiction to be invalid and unenforceable to any extent, the remainder
        of
        this Agreement or the application of such provision to such party or
        circumstances other than those to which it is so determined to be invalid
        and
        unenforceable, shall not be affected thereby, and each provision hereof shall
        be
        validated and shall be enforced to the fullest extent permitted by
        law.

      

      13.6            Waivers;
        Modification.  No party hereto shall be deemed as a
        consequence of any act, delay, failure, omission, forbearance or other
        indulgences granted from time to time by any other party hereto:  (a)
        to have waived, or to be estopped from exercising, any of its rights or remedies
        under this Agreement; or (b) to have modified, changed, amended, terminated,
        rescinded, or superseded any of the terms of this Agreement, unless such
        waiver,
        modification, amendment, change, termination, rescission, or supersession
        is
        express, in writing and signed by the party that is to be bound by such waiver,
        modification, amendment, change, termination, rescission or
        supersession.  No single or partial exercise by any party hereto of
        any right of remedy will preclude any other or further exercise thereof or
        preclude the exercise of any other right or remedy, and a waiver expressly
        made
        in writing on one occasion will be effective only in that specific instance
        and
        only for the precise purpose for which given, and will not be construed as
        a
        consent to or a waiver of any right or remedy on any future occasion or a
        waiver
        of any right or remedy against any other party.

      
        
          
          

        

        
          13

          
            

          

        

        
          
          

        

      

       

      13.7            Attorneys’
        Fees.  In the event that any of the parties hereto (or
        any successor thereto) resorts to legal action, including arbitration, in
        order
        to enforce, defend or interpret any of the terms or the provisions of this
        Agreement, the prevailing party (as determined by the court, arbitrator or
        other
        authority before which such suit or proceeding is validly commenced hereunder)
        shall be entitled to receive, in addition to such other remedies as shall
        be
        awarded to it in such legal action, reimbursement from the non-prevailing
        party
        or parties for all reasonable attorneys’ fees and all other costs incurred in
        commencing or defending such action.  In addition, the prevailing
        party shall be entitled to recover from the non-prevailing party or parties
        post-judgment reasonable attorneys’ fees incurred by the prevailing party in
        enforcing a judgment against the non-prevailing party or
        parties.  Notwithstanding anything in this Agreement to the contrary,
        the provisions of the preceding sentence are intended to be severable from
        the
        balance of this Agreement, shall survive any judgment rendered in connection
        with the aforesaid legal action, and shall not be merged into any such
        judgment.

      

      13.8            Notice.  All
        notices, requests, demands, and other communications required to or permitted
        to
        be given under this Agreement shall be in writing and shall be conclusively
        deemed to have been duly given (a) when hand delivered to the other party;
        or
        (b) when received when sent by facsimile at the address and number set forth
        below (provided, however, that notices given by facsimile shall not be effective
        unless the receiving party delivers a written confirmation of receipt for
        such
        notice either by facsimile or any other method permitted under this Section;
        additionally, any notice given by facsimile shall be deemed received on the
        next
        business day if such notice is received after 5:00 p.m. (recipient’s time) or on
        a nonbusiness day); or (c) three business days after the same have been
        deposited in a United States post office with first class or certified mail
        return receipt requested postage prepaid and addressed to the parties as
        set
        forth below; or (d) the next business day after the same have been deposited
        with a national overnight delivery service reasonably approved by the parties
        (Federal Express and DHL WorldWide Express being deemed approved by the
        parties), postage prepaid, addressed to the parties as set forth below with
        next-business-day delivery guaranteed, provided that the sending party receives
        a confirmation of delivery from the delivery service provider.  Each
        party shall make an ordinary, good faith effort to ensure that it will accept
        or
        receive notices that are given in accordance with this Section, and that
        any
        person to be given notice actually receives such notice.  A party may
        change the address of such party given below for purposes of this Section
        by
        giving the other party written notice of the new address in the manner set
        forth
        above.

      
        
          
          

        

        
          14

          
            

          

        

        
          
          

        

      

       

      If
        to NUTRA to:

      

      NutraCea

      1261
        Hawk’s Flight Court

      El
        Dorado
        Hills, CA 95762

      Attention:
        Bradley Edson

      

      If
        to ITV to:

      

      ITV
        Global Inc.

      P.O.
        Box
        7014

      Beverly,
        Ma 01915

      Attention:
        Christopher Wood

      

      13.9 
            Headings.  The
        captions and other headings contained in this Agreement are for convenience
        only
        and shall not be considered a part of or effect the construction and
        interpretation of any provision of this Agreement.

      

      13.10    Counterparts.  This
        Agreement may be executed in any number of counterparts, each of which shall
        be
        deemed an original but all of which together shall constitute one and the
        same
        document.

      

      13.11    Term.  Subject
        to earlier termination as provided below, the term of this Agreement will
        commence on the date of this Agreement and shall continue two years (2) from
        the
        above date.  This agreement will automatically renew for an additional
        twelve (12) month term following the last day of this Agreement.

      

      13.12    General
        Interpretation.  The terms of this Agreement have been
        negotiated by the parties hereto and the language used in this Agreement
        shall
        be deemed to be the language chosen by the parties hereto to express their
        mutual intent.  This Agreement shall be construed without regard to
        any presumption or rule requiring construction against the party causing
        such
        instrument or any portion thereof to be drafted, or in favor of the party
        receiving a particular benefit under the Agreement.  No rule of strict
        construction will be applied against any person.

      

      

      

      IN
        WITNESS WHEREOF, the parties hereto have executed this Agreement to be effective
        as of the day and year first written above.

      

      
        	
                NUTRACEA®,

              	
                ITV
                  GLOBAL, INC.

              
	
                A
                  California Corporation

              	
                A
                  Nevada Corporation

              

      

       

       

      
        	
                By:

              	 	 	
                By:

              	 
	 	 	 	 	 
	
                Its:

              	 	 	
                Its:

              	 

      

      
        
          
          

        

        
          15

          
            

          

        

        
          
          

        

      

      EXHIBIT
        A

      

      

      PRODUCTS

      

      

      
        	
                 

                 
                  Rice ‘n ShineTM

                 

              
	
                 

                 
                  FlexProtexTM

                 

              
	
                 

                 
                  FlexProtex CreamTM

                 

              
	
                 

                 CeaSweetTM

                 

              
	
                 

                 
                  RiceMucil Wafers®

                 

              
	
                 

                 
                  SuperSolubles®

                 

              
	
                 

                 
                  ZymeBoost®

                 

              
	
                 

                 
                  CeaBarsTM

                 

              

      

       

    

     

    16

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