Document:

Exhibit 10.11

    
      

    

    
      Exhibit
        10.11

       
EMPLOYMENT
      AGREEMENT

    

    THIS
      EMPLOYMENT AGREEMENT (this “Agreement”) is effective as of the 1st of May, 2004
      (the "Effective Date") by and between THE RICEX COMPANY, a Delaware corporation
      ("Employer") and Ike E. Lynch ("Employee").

    

    In
      consideration of the mutual covenants and obligations herein set forth, the
      parties hereto agree as follows:

    

    1.    Employment.
      Employer hereby employs Employee and Employee hereby accepts employment with
      Employer on the terms and conditions set forth below, which supercede in their
      entirety the terms and conditions of any previous employment agreement between
      Employer and Employee. 

    

    2.    Position;
      Scope of Employment.
      Employee shall have the position of Vice President of Operations for The RiceX
      Company and Chief Operating Officer for the Company’s subsidiary, Food Extrusion
      Montana. Employee shall manage the operations of Employer by directing and
      coordinating activities consistent with established goals, objectives and
      policies. In performing the services hereunder, Employee shall follow the
      direction set by the Chief Executive Officer and Board of Directors, and shall
      implement such programs as he deems necessary to ensure attainment of Employer’s
      business plan for growth and profit. Employee also shall provide direction
      and
      structure for all operating units, shall participate in developing policy and
      strategic plans, and shall manage all activities associated with Employer’s
      production, engineering, construction, quality assurance, logistics and research
      and development.

    

    2.1.    Time
      and Effort.
      At
      Employer’s direction, Employee shall devote a minimum of thirty (30) hours per
      month to a maximum of one hundred (100) hours per calendar month to the
      performance of Employee's duties under this Agreement. Any work assignments
      requiring more than one hundred (100) hours per calendar month shall be
      accommodated by Employee, so long as any such assignment does not exceed six
      (6)
      months duration in any calendar year. Employee will have the right to work
      from
      his home office and Employer will have the right to make reasonable travel
      requests from time to time of Employee. 

    

    2.2    Other
      Employment.
      Employee may render services to third parties for compensation or other benefit,
      so long as such other business activities in no way interfere with the
      performance of Employee's duties under this Agreement. 

    

    2.3.    Rules
      and Regulations.
      Employee
      agrees to observe and comply with Employer's rules and regulations as provided
      by Employer and as may be amended from time to time by Employer, and will carry
      out and faithfully perform such orders, directions and policies of
      Employer.

    

    3.    Term
      of Employment.
      Employee's term of employment pursuant to this Agreement shall commence on
      the
      Effective Date and shall automatically terminate on the fifth anniversary of
      the
      Effective Date, unless (i) terminated earlier as provided herein, or (ii)
      extended pursuant to written notice from Employer to Employee, which notice
      shall be given not less than six (6) months prior to the expiration of the
      initial term, and operate to extended the term hereof for an additional term
      of
      five (5) years.

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    4.    Compensation.
      During
      the term of this Agreement, Employer shall compensate Employee for his services
      to Employer at a rate of $3000/month for up to thirty (30) hours of work per
      month. If more than thirty (30) hours of work per month is required by Employer,
      Employee shall be compensated at a rate of $100/hour for all additional hours
      worked. Employee’s compensation shall be subject to an annual adjustment of five
      percent (5%) upon each anniversary date of the Effective Date. 

    

    4.1.    Benefits.
      Employee shall be provided with medical insurance and such other benefits as
      provided to Employer's other similarly situated employees and in accordance
      with
      Employer's policies, as modified from time to time in Employer's sole and
      absolute discretion.

    

    4.2.    Reimbursement
      of Expenses.
      During
      the term of this agreement, Employee shall be reimbursed for all standard travel
      expenses as outlined in the Company Employee Manual. Office expenses including
      rent and utilities will be paid by the Employer. 

    

    4.3.    Vacation
      and Sick Leave.
      Employee shall be entitled to four weeks of vacation each calendar year.
      Employee's vacation shall accrue at the rate of thirteen and one-thirds (13
      1/3)
      hours per month but in no event shall Employee's total accrued vacation exceed
      eight (8) weeks. In lieu of vacation time off, the employee may elect to be
      paid
      accrued vacation time at the Employee’s existing prevailing hourly rate.
      Employee shall be entitled to sick leave in accordance with Employer's sick
      leave policy.

    

    4.4.    Automobile.
      Employer shall make lease/purchase payments on behalf of Employee, up to a
      maximum amount of eight hundred dollars ($800) per month. Employer shall also
      reimburse Employee for his actual expenses incurred in the operation of one
      automobile for automobile insurance, and annual registration and maintenance,
      subject to receipt of documentation therefor reasonably satisfactory to
      Employer.

    

    4.5.    Bonus.
      Employee shall be eligible to participate in Employer’s bonus program if and
      when implemented to the same extent as other similarly situated employees of
      Employer. Employer intends to adopt such a program prior to the expiration
      of
      this Agreement, but makes no further representations as to the terms of such
      program or the date on which such program may be enacted. An international
      business development bonus will be paid to the employee for any international
      deal structured by the employee. The bonus will be determined by the
      Compensation Committee of the Board and will be consistent with similar bonuses
      paid for similar activities in commercial deals. 

    

    4.6.    Stock
      or Stock Option Plan.
      If
      Employer grants stock or other equity incentives to its other similarly situated
      employees during the term of this Agreement, Employer shall consider granting
      stock or other equity incentives to Employee, in the amounts and upon such
      terms
      and conditions as Employer shall, in its sole and absolute discretion,
      determine.

    
      
        
        

      

      
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    4.7.    Relocation
      Expenses.
      The
      Employer will provide a one-time relocation allowance of $6,000 during the
      term
      of this agreement. 

    

    5.    Termination
      of Employment

    

    5.1.    Termination
      Events.
      Employee's employment shall be terminated prior to the expiration of this
      Agreement (“Early Termination”) upon the occurrence of any of the following
      events: (i) the mutual written agreement of Employer and Employee;
      (ii) Employee's disability which shall, for the purposes of
      this
      Agreement, mean Employee's inability due to physical or mental impairment to
      perform Employee's duties and obligations under this Agreement, despite
      reasonable accommodation by Employer, for a period exceeding in the aggregate
      three (3) months in any twelve (12) consecutive month period;
      (iii) Employee's death; (iv) notice by Employer of termination for
      cause as defined in Section 5.2 below; (iv) written notice of
      termination by Employer without cause upon fourteen (14) days’ notice, subject
      to the Compensation Upon Early Termination provisions of Section 5.3
      below.

    

    5.2.    Termination
      for Cause.
      Employer reserves the right to terminate this Agreement for cause upon
      (i) Employee's willful and continued failure substantially to perform his
      duties and obligations under this Agreement after written demand for substantial
      performance has been delivered to Employee by Employer, which demand sets forth
      with reasonable specificity the deficiencies in Employee's performance and
      gives
      Employee not less than thirty (30) days to correct such deficiencies;
      (ii) fraud or intentional material misrepresentation by Employee,
      (iii) unauthorized disclosure or use of Employer's trade secrets or
      Confidential Information by Employee; (iv) Employee's conviction of a
      felony; (v) theft or conversion of Employer's property by Employee; or
      (vi) Employee's habitual misuse of alcohol, illegal narcotics or other
      intoxicant.

    

    5.3.    Compensation
      Upon Early Termination.
      Upon
      early termination, Employer shall pay Employee compensation as
      follows.

    

    (A)    If
      Employee is terminated by Employer for cause, voluntarily resigns, dies, or
      becomes disabled as such term is used in Section 5.1 of this Agreement, Employer
      shall pay Employee, or Employee’s representative, all accrued but unpaid salary
      and vacation pay accrued through the effective date of the
      termination.

    

    (B)    If
      Employee is terminated by Employer without cause, Employer shall pay to Employee
      as liquidated damages, and in lieu of any and all other claims that Employee
      may
      have against Employer, the remaining term of the agreement times the average
      annual Employee compensation of the previous twenty-four months (or actual
      number of months worked if fewer than twenty-four), with a maximum payment
      of
      two hundred and fifty thousand dollars. Employer's payment pursuant to this
      section shall fully and completely discharge any and all obligations of Employer
      to Employee arising out of or related to this Agreement and shall constitute
      liquidated damages in lieu of any and all claims that Employee may have against
      Employer, not including any obligation under the Worker’s Compensation laws
      including its Employer's Liability provisions.

    
      
        
        

      

      
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    (C)    If
      Employee is terminated as the result of a Change in Control and Employee is
      not
      employed in the same capacity or being paid the same salary by the new entity,
      then Employee shall receive a severance payment of one hundred and eighty
      thousand dollars ($180,000). In addition, if Employee is terminated as the
      result of a Change in Control and Employee is not employed in the same capacity
      by the new entity, Employer agrees to continue Employee’s medical and dental
      insurance benefits as provided during Employee’s employment with Employer for a
      period of two (2) years from the effective date of the Change in Control, except
      as provided below in Section 5.3(C)(1) and Section 5.3(C)(2).

    

    (1)    Employee
      agrees that he shall accept any plan coverage changes that may occur during
      the
      two (2)-year period, which apply to all employees in the workforce.

    

    (2)    Employee
      agrees that he will notify Employer (or any successor of Employer) if he becomes
      employed in any capacity with another employer and becomes eligible to receive
      medical and dental insurance benefits through that employment prior to the
      expiration date of the two (2) year period set forth in this section. At such
      time, Employer shall no longer be obligated to provide Employee with medical
      and
      dental insurance benefits.

    

    6.    Proprietary
      Information; Confidentiality.

    

    6.1.    Confidential
      Information.
      Employee agrees not to disclose to any others, or take or use for Employee's
      own
      purposes or purposes of any others, during the term of this Agreement, any
      of
      Employer's Confidential Information (as defined below). Employee agrees that
      these restrictions shall also apply to (1) Confidential Information belonging
      to
      third parties in Employer's possession and (2) Confidential Information
      conceived, originated, discovered or developed by Employee during the term
      of
      this Agreement. "Confidential Information" means any Employer proprietary
      information, technical data, trade secrets or know-how, including, but not
      limited to, research, product plans, products, services, customer lists and
      customers, markets, software, developments, inventions, processes, formulas,
      technology, designs, drawings, engineering, marketing, finances or other
      business information disclosed to Employee by Employer, either directly or
      indirectly, in writing, orally or by drawings, or by observation of products.
      Confidential Information does not include any of the foregoing items that has
      become publicly known and made generally available through no wrongful act
      of
      Employee. Employee further agrees not to use improperly or disclose or bring
      onto the premises of Employer any trade secrets of another person or entity
      during the term of this Agreement.

    

    6.2.    Return
      of Property.
      Employee agrees that upon termination of employment with Employer, Employee
      will
      deliver to Employer all devices, records, data, disks, computer files, notes,
      reports, proposals, lists, correspondence, specifications, drawings, blueprints,
      sketches, materials, equipment, other documents or property, or reproductions
      of
      any aforementioned items developed by Employee pursuant to employment with
      Employer or otherwise belonging to Employer, its successors or
      assigns.

    
      
        
        

      

      
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    6.3.    Notification
      of New Employer.
      Employer shall have the right to notify any actual or potential future employer
      of Employee of Employee's rights and obligations under this Section 6 of
      the Agreement. Employee expressly authorizes such disclosure and waives any
      claims Employee may have against Employer resulting from the disclosure of
      Employee's obligations under this Section 6 to an actual or potential
      future employer of Employee.

    

    6.4.    Other
      Agreements.
      Employee represents that the performance of all the terms of this Agreement
      will
      not breach any agreement to keep in confidence proprietary information acquired
      by Employee in confidence or in trust prior to employment with Employer.
      Employee has not and shall not enter into any oral or written agreement in
      conflict with this Agreement.

    

    6.5.    Equitable
      Remedies.
      Employee agrees that it would be impossible or inadequate to measure and
      calculate Employer's damages from any breach of the covenants set forth in
      this
      Section 7 of the Agreement. Accordingly, Employer shall have available, in
      addition to any other right or remedy available under law or equity, the right
      to obtain any injunction from a court of competent jurisdiction restraining
      such
      breach or threatened breach and to specific performance of any such provision
      of
      this Section 7. Employee further agrees that no bond or other security
      shall be required in obtaining such equitable relief and consents to the
      issuance of such injunction and to the ordering of specific
      performance.

    

    7.    Miscellaneous.

    

    7.1.    Notices.
      Any
      notice under this Agreement shall be in writing, and any written notice or
      other
      document shall be deemed to have been duly given (i) on the date of personal
      service on the parties, (ii) on the third business day after mailing, if the
      document is mailed by registered or certified mail, (iii) one day after being
      sent by professional or overnight courier or messenger service guaranteeing
      one-day delivery, with receipt confirmed by the courier, or (iv) on the date
      of
      transmission if sent by telegram, telex, telecopy or other means of electronic
      transmission resulting in written copies, with receipt confirmed. Any such
      notice shall be delivered or addressed to the parties at the addresses set
      forth
      below or at the most recent address specified by the addressee through written
      notice under this provision. Failure to give notice in accordance with any
      of
      the foregoing methods shall not defeat the effectiveness of notice actually
      received by the addressee.

    

    7.2.    Enforcement. In
      the
      event of any dispute concerning any aspect of the obligations of the Company
      under this Agreement, the Company or its successor shall reimburse Employee
      all
      attorney fees and costs incurred by Employee in connection with adjudication
      of
      such matters.

    

    7.3.    Choice
      of Law, Jurisdiction, Venue.
      This
      Agreement shall be interpreted in accordance with the laws of the State of
      California. The exclusive jurisdiction and venue of any legal action by either
      party under this Agreement shall be the Superior Court of California in and
      for
      the County of El Dorado..

    

    7.4.    Amendment.
      The
      provisions of this Agreement may be modified at any time by agreement of the
      parties. Any such agreement hereafter made shall be ineffective to modify this
      Agreement in any respect unless in writing and signed by the parties against
      whom enforcement of the modification or discharge is sought.

    
      
        
        

      

      
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    7.5.    Waiver.
      Any of
      the terms or conditions of this Agreement may be waived at any time by the
      party
      entitled to the benefit thereof, but no such waiver shall affect or impair
      the
      right of the waiving party to require observance, performance or satisfaction
      either of that term or condition as it applies on a subsequent occasion or
      of
      any other term or condition.

    

    7.6.    Assignment.
      The
      parties agree that Employee's rights and obligations under this Agreement are
      personal and not assignable. This Agreement contains the entire agreement
      between the parties to it and shall be binding on and inure to the benefit
      of
      the heirs, personal representatives, successors and assigns of
      Employer.

    

    7.7.    Independent
      Covenants.
      All
      provisions herein concerning unfair competition and confidentiality shall be
      deemed independent covenants and shall be enforceable without regard to any
      breach by Employer unless such breach by Employer is willful and
      reckless.

    

    7.8.    Entire
      Agreement.
      This
      document constitutes the entire agreement between the parties, all oral
      agreements being merged herein, and supersedes all prior representations and
      written agreements. There are no representations, agreements, arrangements,
      or
      understandings, oral or written, between or among the parties relating to the
      subject matter of this Agreement that are not fully expressed
      herein.

    

    7.9.    Severability.
      If any
      provision of this Agreement is held by a court of competent jurisdiction to
      be
      invalid or unenforceable, the remainder of the Agreement which can be given
      effect without the invalid provision shall continue in full force and effect
      and
      shall in no way be impaired or invalidated.

    

    7.10.   
        Captions.
      All
      paragraph captions are for reference only and shall not be considered in
      construing this Agreement.

    

    

    DATED: March
      30,
      2004

    

    
      	
              THE
                RICEX COMPANY

            	 	
              EMPLOYEE

            
	 	 	 	 
	 	 	 	 
	
              By:

            	
              /s/
                Daniel L. McPeak, Sr.

            	 	
              /s/
                Ike E. Lynch

            
	 	
              Daniel
                L. McPeak, Sr.

            	 	
              Ike
                E. Lynch 

            
	
              Its:

            	
              Chief
                Executive Officer

            	 	
               

            

    

     

    6Exhibit 10.12

    
      

    

    
      Exhibit
        10.12

       
FIRST
      AMENDMENT TO EMPLOYMENT AGREEMENT

    

    This
      First Amendment to Employment Agreement (this “First
      Amendment”)
      is
      executed as of October 4, 2005 by and among NUTRACEA, a California corporation
      (“Employer”),
      THE
      RICEX COMPANY, a Delaware corporation (“Company”),
      and
      IKE E. LYNCH, an individual (“Employee”).

    

    A.    WHEREAS,
      Company
      and Employee are parties to that certain Employment Agreement dated as of May
      1,
      2004 (the “Agreement”).

    

    B.    WHEREAS,
      Company
      has entered into that certain Agreement and Plan of Merger and Reorganization,
      dated April 4, 2005, with Employer and Red Acquisition Corporation (the
“Merger
      Agreement”).

    

    C.    WHEREAS,
      as a
      condition to the consummation of the transactions contemplated by the Merger
      Agreement (the “Merger”),
      Company has agreed to amend the Agreement.

    

    D.    WHEREAS,
      contemporaneous to the effective time of the Merger, which shall be such time
      as
      Company files a Certificate of Merger with the Secretary of State of the State
      of Delaware (the “Effective
      Time”),
      Company desires to assign to Employer, and Employer desires to assume from
      Company, the Agreement, as amended by this First Amendment.

    

    E.    WHEREAS,
      as
      consideration for (i) entering into this First Amendment and (ii) Employee’s
      continued employment with Employer following the Merger, Company has agreed
      to,
      and Employer has consented to, the payment by Company of a bonus to Employee,
      which bonus shall be earned and payable immediately following the approval
      of
      the Merger by the stockholders of Company.

    

    F.    WHEREAS,
      Employer, Company and Employee desire to amend the Agreement as set forth in
      this First Amendment.

    

    G.    WHEREAS,
      Employer, Company and Employee desire that this First Amendment shall become
      effective only as of the Effective Time.

    

    NOW,
      THEREFORE,
      in
      consideration of the foregoing and the mutual covenants and agreements contained
      herein and for other good and valuable consideration, the receipt and
      sufficiency of which are hereby acknowledged, the parties hereto agree as
      follows:

    

    AMENDMENT

    

    1.    Amendment.
      The
      following paragraphs are amended and restated or added, as applicable, as
      follows:

    

    a.    Section
      2., Position;
      Scope of Employment,
      is
      amended by deleting the entire paragraph thereof and adding the following
      paragraph:

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    “2.
      Position;
      Scope of Employment.
      Employee shall have the position of Chief Operating Officer for Employer and
      for
      the Company and its subsidiary, Food Extrusion Montana. Employee shall manage
      the operations of Employer by directing and coordinating activities consistent
      with established goals, objectives and policies. In performing the services
      hereunder, Employee shall follow the direction set by the Chief Executive
      Officer and Board of Directors of Employer, and shall implement such programs
      as
      he deems necessary to ensure attainment of Employer’s business plan for growth
      and profit. Employee also shall provide direction and structure for all
      operating units, shall participate in developing policy and strategic plans,
      and
      shall manage all activities associated with Employer’s production, engineering,
      construction, quality assurance, logistics and research and
      development.

    

    b.    Section
      2.1., Time
      and Effort,
      is
      amended by deleting the entire paragraph thereof and adding the following
      paragraph:

    

    “2.1.
      Entire
      Time and Effort.
      Employee shall devote Employee’s full working time, attention, abilities, skill,
      labor and efforts to the performance of Employee’s employment. Employee shall
      not directly or indirectly (i) be substantially engaged in or concerned with
      any
      other duties or pursuits, (ii) render services to any third party for
      compensation or other benefit, or (iii) engage in any other business activity
      that will in any way interfere with the performance of Employee’s duties under
      this Agreement, except with the prior written consent of Employer; provided,
      however, that Employee may engage in charitable, philanthropic, educational,
      religious, civic and similar such activities to the extent that such activities
      do not unreasonably interfere with the performance of Employee’s duties under
      this Agreement.”

    

    c.    Section
      2.2, Other
      Employment,
      is
      amended by deleting the entire paragraph thereof and adding the following
      paragraph:

    

    “2.2.
      [Intentionally Omitted.]”

    

    d.    Section
      3., Term
      of Employment,
      is
      amended by deleting the entire paragraph thereof and adding the following
      paragraph:

    

    “3.
      Term
      of Employment.
      Employee’s term of employment pursuant to this Agreement shall commence on the
      Effective Time and shall terminate three (3) years from that date, unless
      terminated earlier as provided herein. At the end of the initial three (3)-year
      term, this Agreement shall automatically renew for an additional one (1)-year
      term unless either party notifies the other party in writing ninety (90) days
      prior to the expiration of the term of his or its intention not to renew this
      Agreement.”

    
      
        
        

      

      
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    e.    Section
      4., Compensation,
      is
      amended by deleting the entire paragraph thereof and adding the following
      paragraph:

    

    “4.
      Compensation.
      Employer shall pay employee the base pay (“Base
      Salary”)
      of One
      Hundred Fifty Thousand Dollars ($150,000) per year, which shall take effect
      as
      of the Effective Time. Salary payments will be payable in periodic installments
      in accordance with Employer’s pay schedule, but not less than twice per month.
      The Base Salary shall be reviewed at least annually, and shall be adjusted
      to
      compensate for cost of living adjustments in the Sacramento metropolitan
      area.”

    

    f.    Section
      4.4, Automobile,
      is
      amended by adding the following sentence to the end of the existing
      paragraph:

    

    “Notwithstanding
      the foregoing, Employer shall not be obligated to make any down payments for
      the
      purchase of any automobile by or on behalf of Employee.”

    

    g.    Section
      4.8, Accrued
      Vacation Pay,
      is
      hereby added to the Agreement by adding the following paragraph:

    

    “4.8.
      Accrued
      Vacation Pay.
      Immediately prior to the Effective Time, Company shall pay to Employee all
      vacation pay due to Employee that has been accrued but unpaid up to and through
      the Effective Time.”

    

    h.    Section
      4.9, Closing
      Bonus,
      is
      hereby added to the Agreement by adding the following paragraph:

    

    “4.9.
      Closing
      Bonus.
      Immediately following the approval of the merger effected pursuant to that
      certain Agreement and Plan of Merger and Reorganization, dated as of April
      4,
      2005, by and between Employer, Red Acquisition Corporation, the wholly-owned
      subsidiary of Employer and Company by the stockholders of Company, Company
      shall
      pay to Employee a bonus of $50,000, net of any federal, state or local
      withholding or other taxes or charges.”

    

    i.    Section
      5.3(B) is amended by deleting the entire paragraph thereof and adding the
      following paragraph:

    

    “(B)
       If
      Employee is terminated by Employer without cause, Employer shall pay to Employee
      as liquidated damages, and in lieu of any and all other claims that Employee
      may
      have against Employer, an amount equal to the greater of (i) the monthly Base
      Salary multiplied by the number of months remaining on the term of this
      Agreement, and (ii) one (1) year of Base Salary, but in no event shall severance
      pay exceed three (3) years of Base Salary, regardless of the
      term.”

    
      
        
        

      

      
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    j.    Section
      5.3(C) is amended by deleting the entire paragraph thereof and adding the
      following paragraph:

    

    “(C)
       If
      Employee is terminated as the result of a Change in Control (as defined below)
      and Employee is not employed in the same capacity or being paid the same salary
      by the new entity as Employee was employed with, or paid by, Employer, then
      Employee shall receive a severance payment of one hundred eighty thousand
      dollars ($180,000). In addition, if Employee is terminated as the result of
      a
      Change in Control and Employee is not employed in the same capacity by the
      new
      entity, Employer agrees to continue Employee’s medical and dental insurance
      benefits as provided during Employee’s employment with Employer for a period of
      two (2) years from the effective date of the Change in Control, except as
      provided below in Section 5.3(C)(1) and Section 5.3(C)(2). For the purposes
      of
      this Agreement, a “Change in Control” means:

    

    (1)    a
      merger
      or acquisition in which Employer is not the surviving entity, except for (a)
      a
      transaction the principal purpose of which is to change the state of Employer’s
      incorporation, or (b) a transaction in which Employer’s stockholders immediately
      prior to such transaction hold, immediately after such transaction, at least
      50%
      of the voting power of the surviving entity;

    

    (2)    a
      stockholder approved sale, transfer or other disposition of all or substantially
      all of the assets of Employer;

    

    (3)    a
      transfer of all or substantially all of Employer’s assets pursuant to a
      partnership or joint venture agreement or similar arrangement where Employer’s
      resulting interest is less than fifty percent (50%);

    

    (4)    any
      reverse merger in which Employer is the surviving entity but in which fifty
      percent (50%) or more of Employer’s outstanding voting stock is transferred to
      holders different from those who held the stock immediately prior to such
      merger;

    

    (5)    on
      or
      after the date hereof, a change in ownership of Employer through an action
      or
      series of transactions, such that any person is or becomes the beneficial owner,
      directly or indirectly, of securities of Employer representing fifty percent
      (50%) or more of the voting power of Employer’s outstanding securities;
      or

    

    (6)    a
      majority of the members of the Board of Directors are replaced during any twelve
      (12) month period by directors whose appointment or election is not endorsed
      by
      a majority of the members of the Board of the Directors prior to the date of
      such appointment of election.

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    Notwithstanding
      the foregoing, the transactions effected pursuant to, or required by, that
      certain Agreement and Plan of Merger and Reorganization, dated as of April
      4,
      2005, by and between Employer, Red Acquisition Corporation, the wholly-owned
      subsidiary of Employer and Company, shall not constitute a Change in
      Control.”

    

    k.    Section
      6.1., Confidential
      Information,
      is
      amended by deleting the first sentence and replacing it with the following
      sentence:

    

    “Employee
      agrees not to disclose to any others, or take or use for Employee’s own purposes
      or purposes of any others, during the term of this Agreement or at any time
      thereafter, any of Employer’s Confidential Information (as defined
      below).”

    

    l.
    All
      restrictions placed upon Employee in Section 6., Proprietary
      Information; Confidentiality,
      of the
      Agreement with respect to “Confidential Information” shall be deemed to apply to
      Confidential Information of the Employer and Employer’s direct or indirect
      subsidiaries.

    

    2.    Affirmation.
      In order
      to induce each other to enter into this First Amendment, the parties hereby
      confirm that all terms and provisions of the Agreement have been and continue
      to
      be in all respects in full force and effect, and no violation of the terms
      and
      conditions of the Agreement has occurred.

    

    3.    Effective
      Date; Assignment and Assumption.
      This
      First Amendment shall become effective only upon the Effective Time. Effective
      immediately from and after the Effective Time, (i) all of Company’s right, title
      and interest in and to the Agreement, as amended by this First Amendment, shall
      be deemed to have been assigned, granted, bargained, transferred, conveyed,
      set
      over and delivered unto Employer, and (ii) Employer shall be deemed to have
      assumed the Agreement, as amended by this First Amendment, and shall faithfully
      and timely discharge and perform each and every obligation of Company arising
      under the Agreement, as amended by this First Amendment.

    

    4.    Modification;
      Interpretation.
      Except
      as expressly set forth in this First Amendment, this First Amendment shall
      not
      alter, amend, or otherwise modify the terms and provisions of the Agreement.
      From and after the Effective Time, all references in the Agreement to “the
      Agreement,” “this Agreement” or any similar reference shall refer to the
      Agreement as amended by this First Amendment. From and after the Effective
      Time,
      all references in the Agreement to “Employer,” or any similar reference shall
      refer to NutraCea, a California corporation. Capitalized terms not otherwise
      defined herein shall have the respective meanings ascribed to them in the
      Agreement or the Merger Agreement.

    

    5.    Approval
      by Company’s Board of Directors.
      Company
      hereby represents that its Board of Directors has duly approved the terms of
      this First Amendment.

    

    

    [The
      Remainder of this Page is Intentionally Left Blank -- Signature Page
      Follows]

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF, the parties have executed this First Amendment as of the date
      first set forth above.

    

    
      	
              NUTRACEA

            	 	 	 
	 	 	 	 	 
	
              By:

            	
              /s/
                Brad Edson

            	 	 	 
	
              Name:

            	
              Brad
                Edson

            	 	 	 
	
              Title:

            	
              President

            	 	
              /s/Ike
                E. Lynch

            	 
	 	 	 	
              IKE
                E. LYNCH

            	 
	 	 	 	 	 
	
              THE
                RICEX COMPANY

            	 	 	 
	 	 	 	 	 
	
              By:

            	
              /s/
                Todd Crow

            	 	 	 
	
              Name:

            	
              Todd
                Crow

            	 	 	 
	
              Title:

            	
              CFO

            	 	 	 

    

     

    6

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