Document:

Exhibit
      10.1

     

     

     

     

    
 

    [*Designates
      portions of this document have been omitted pursuant to a request for

    confidential
      treatment filed separately with the Commission]

     

     

     

    LIMITED
      LIABILITY COMPANY AGREEMENT

    

    FOR

    

    GRAIN
      ENHANCEMENT, LLC,

    a
      Delaware limited liability company

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    LIMITED
      LIABILITY COMPANY AGREEMENT

    FOR

    GRAIN
      ENHANCEMENT, LLC,

    A
      DELAWARE LIMITED LIABILITY COMPANY

    

    NutraCea,
      a California corporation located at 5090 North 40th
      Street,
      Suite 400, Phoenix, AZ 85018 (“NutraCea”),
      Pacific
      Advisors Holdings Limited, a company incorporated under the laws of British
      Virgin Islands,
      located
      at 53 Cairnhill Road, Cairnhill Plaza #12-01, Singapore 229664 (“Pacific
      Advisors”),
      Theorem Group, LLC, a California limited liability company, located at 2049
      Century Park East, #3630 Los Angeles, CA 90067 (“Theorem”),
      and
      Ho’okipa Capital Partners, Inc., a California corporation (“Ho’okipa ”) agree,
      effective as of June ___, 2007 (the “Effective
      Date”),
      as
      follows:

    

    ARTICLE
      I

    Background
      and Purpose.

    

    1.1.    Certificate.
      On or
      about June 22, 2007 a Certificate of Formation for Grain Enhancement, LLC
      (“Certificate”),
      a
      limited liability company formed under the laws of the State of Delaware
      (“Company”),
      was
      filed with the office of the Delaware Secretary of State.

    

    1.2.    Adoption
      of Agreement.
      The
      Members desire to adopt and approve a limited liability company agreement for
      the Company under the Delaware Limited Liability Company Act upon the terms
      and
      subject to the conditions of this Agreement.

    

    ARTICLE
      II

    Certain
      Definitions. 

    

    The
      following terms shall have the meanings set forth below unless the context
      requires otherwise: 

    

     Act.
      “Act”
means
      the Delaware Limited Liability Company Act, Delaware Code Annotated Title 6,
      Sections 18-101 through 18-1109, as amended from time to time and any
      corresponding provisions of succeeding law.

    

    Affiliate.
      “Affiliate”
means
      (i) any individual, partnership, corporation, trust or other entity or
      association, that directly or indirectly, through one or more intermediaries,
      controls, is controlled by, or is under common control with a Member, or that
      holds a substantial beneficial interest in a Member, or (ii) any relative or
      spouse of any person who holds a substantial beneficial interest in a Member.
      The term “control,” as used above, means, with respect to a corporation or
      limited liability company, the right to exercise, directly or indirectly, more
      than fifty percent (50%) of the voting rights attributable to the controlled
      corporation or limited liability company and, with respect to any individual,
      partnership, trust, other entity or association, the possession, directly or
      indirectly, of the power to direct or cause the direction of the management
      or
      policies of the controlled entity.

    

    Agreement.
      “Agreement”
means
      this limited liability company agreement of Grain Enhancement, LLC, as
      originally executed and as amended from time to time.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Assignee.
      “Assignee”
means
      a
      person who has acquired a beneficial interest in the Company who is not a
      substitute Member in accordance with the requirements of this
      Agreement.

    

    Bankruptcy.
      “Bankruptcy”
means:
      (a) the filing of an application by a Member for, or his or her consent to,
      the
      appointment of a trustee, receiver, or custodian of his or her other assets:
      (b)
      the entry of an order for relief with respect to a Member in proceedings under
      the United States Bankruptcy Code, as amended or superseded from time to time;
      (c) the making by a Member of a general assignment for the benefit of creditors;
      (d) the entry of an order, judgment, or decree by any court of competent
      jurisdiction appointing a trustee, receiver, or custodian of the assets of
      a
      Member unless the proceedings and the person appointed are dismissed within
      ninety (90) days; or (e) the failure by a Member generally to pay his or her
      debts as the debts become due within the meaning of Section 303(h)(1) of the
      United States Bankruptcy Code, as determined by the Bankruptcy Court, or the
      admission in writing of the Member’s inability to pay his or her debts as they
      become due.

    

    Capital
      Account.
      “Capital
      Account”
means
      an account initially reflecting the Capital Contribution of a Member which
      the
      Company establishes and maintains for such Member pursuant to Section
      4.3.

    

    Capital
      Contribution.
      “Capital
      Contribution”
means
      the total value of cash and fair market value of property (including promissory
      notes or other obligation to contribute cash or property) contributed to the
      Company by a Member or the Member’s predecessor in interest.

    

    Certificate.
      “Certificate”
means
      the Certificate of Formation for the Company, as originally filed with the
      Delaware Secretary of the State pursuant to Section 18-201 of the
      Act.

    

    Class
      A Members. “Class
      A Members”
means
      NutraCea and Pacific
      Advisors
      and any
      other Person admitted to the Company as a Class A Member with the unanimous
      approval of the Class A Members or is an Assignee who has become a Class A
      Member in accordance with Article IX, and has not resigned, withdrawn,
      dissolved, or had its Membership Interest terminated for any other
      reason.

    

    Class
      B Members. “Class
      B Members”
means
      Theorem
      and
      Ho’okipa and any other Person admitted to the Company as a Class B Member with
      the unanimous approval of the Class A Members or is an Assignee who has become
      a
      Class B Member in accordance with Article IX, and has not resigned, withdrawn,
      dissolved, or had its Membership Interest terminated for any other reason.
      Except to the extent required by law, the Class B Members shall have no voting,
      approval, consent or management participation rights and shall have no rights
      to
      information concerning the business and affairs of the Company.

    

    Code.
      “Code”
means
      the Internal Revenue Code of 1986, as amended from time to time, the provisions
      of succeeding law, and to the extent applicable, the Regulations. A reference
      to
      a specific section of the Code refers not only to that specific section but
      any
      corresponding provisions of any federal tax statute enacted after the date
      of
      this Agreement, as such specific section or corresponding provisions are in
      effect on the date of application of this Agreement containing such
      reference.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    Company.
      “Company”
means
      Grain Enhancement, LLC, a Delaware limited liability company formed pursuant
      hereto upon the filing the Certificate and execution of this
      Agreement.

    

    Disposition
      Event.
      “Disposition
      Event”
means
      one or more of the following with respect to a Member: the retirement,
      resignation, Bankruptcy or dissolution of the Member, or occurrence of any
      other
      event which terminates the continued Membership of a Member other than pursuant
      to a transfer or assignment by the Member pursuant to Article IX.

    

    Distributable
      Cash.
      “Distributable
      Cash”
means
      cash from any source including the net revenues from operations, net proceeds
      from any sales or other dispositions or refinancing of Company assets, and
      all
      principal and interest payments with respect to any note or other obligation
      received by the Company in connection with sales and other dispositions of
      Company assets, less any portion used to pay into or establish Working Capital
      Reserves.

    

    Distribution.
      “Distribution”
means
      the transfer of money or property by the Company to the Members or its Members
      without consideration.

    

    Economic
      Interest.
      “Economic
      Interest”
means
      a
      Member’s share, or Economic Interest Owner’s share, of the Company’s Taxable Net
      Income, Taxable Net Loss, and/or Distributions of the Company’s assets pursuant
      to this Agreement and the Act, but shall not include any other rights of a
      Member, including, without limitation, the right to vote or participate in
      the
      management, or any right to information concerning the business and affairs
      of
      the Company. 

    

    Economic
      Interest Owner.
      "Economic
      Interest Owner"
      means
      the owner of an Economic Interest (i) who has not been admitted as a Member
      in
      accordance with the requirements of this Agreement, or (ii) whose Membership
      Interest (but not that Member’s Economic Interest) has terminated. 

    

    Finance
      Committee.
      “Finance
      Committee”
means
      a
      committee of two (2) individuals, of which NutraCea will appoint one member
      and
Pacific
      Advisors
      shall
      appoint the other member. NutraCea and Pacific Advisors each may replace their
      respective designated appointees to the Finance Committee from time to time
      by
      written notice to the other Class A Member and the other member of the Finance
      Committee.  

    

    Fiscal
      Year.
      “Fiscal
      Year”
means
      the Company’s fiscal year, which shall end on December 31.

    

    Former
      Member.
      “Former
      Member”
has
      the
      meaning set forth in Section 10.1.

    

    Former
      Member’s Interest.
      “Former
      Member’s Interest”
has
      the
      meaning set forth in Section 10.1.

    

    Majority
      in Interest.
      “Majority
      in Interest”
means
      one or more Percentage Interests of Class A Members which exceed fifty one
      percent (51%) of the aggregate of all Percentage Interests held by Class A
      Members, except to the extent (and solely to the extent) otherwise required
      by
      applicable law. It is the intention of the Members that the Class B Members
      shall have no voting rights.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Member.
      “Member”
means
      the Class A Members and the Class B Members.

    

    Membership
      Interest.
      “Membership
      Interest”
means
      a
      Member’s entire interest in the Company including the Member’s Economic
      Interest, the right to vote on or participate in the management, and the right
      to receive information concerning the business and affairs of the
      Company.

    

    Percentage
      Interest.
      “Percentage
      Interest”
means
      the percentage interest of a Member, as such percentage may be adjusted from
      time to time. Initially, the Percentage Interests shall be NutraCea – forty-seven
      and
      one-half percent (47.5%), Pacific
      Advisors –
      forty-seven and
      one-half percent (47.5%), Theorem–[*]
      percent
      ([*]
      %),
      and
      Ho’okipa –[*]
      percent
      ([*]
      %).
      

    

    Person.
      “Person”
means
      any individual, corporation, partnership, association, limited liability
      company, trust, estate or other entity.

    

    Product.
      “Product”
means
      the SRB and other SRB derivative products listed on Exhibit
      B
      and any
      additional products added to such Exhibit
      B
      by the
      mutual agreement of the Class A Members, for which products the Company shall
      have rights to manufacture, advertise, promote, market, sell and/or otherwise
      distribute the products throughout the Territory pursuant to the
      Project.

    

    Project.
      “Project”
has
      the
      meaning set forth in Section 3.5.

    

    Remaining
      Member(s).
      “Remaining
      Member(s)”
has
      the
      meaning set forth in Section 10.1.

    

    SRB.
      “SRB”
has
      the
      meaning set forth in Section 3.6.1.

    

    Taxable
      Net Income and Taxable Net Loss.
      “Taxable
      Net Income”
      and
“Taxable
      Net Loss”
means
      the income, gain, loss, deductions and credits of the Company in the aggregate
      or separately, as appropriate, determined by certified public accountants for
      the Company and in accordance with United States generally accepted accounting
      principals, consistently applied, at the close of each Fiscal Year, reflected
      on
      the Company’s information tax return filed for federal income tax
      purposes.

    

    Territory.
      “Territory”
means
      the Republic of Indonesia, Vietnam, Thailand,
      Malaysia, Australia, New Zealand and Singapore.
      

    

    Unreturned
      Capital Contributions.
      “Unreturned
      Capital Contributions”
means
      the aggregate Capital Contributions of a Member as they exist from time to
      time,
      less the aggregate amount of Distributions to date to the Member. 

    

    Working
      Capital Reserve.
      “Working
      Capital Reserve”
means
      any cash reserve for normal expenses and contingencies maintained by the Finance
      Committee pursuant to Section 7.3.  

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Qualifying
      Event.
      “Qualifying
      Event”
      shall
      mean the first to occur of the following: (A) the closing of an underwritten
      public offering of the Company or any successor thereto, in which the gross
      proceeds of such public offering are equal to or greater than [*]
      U.S.
      Dollars ($ [*]),
      (B)
      the equity securities of the Company becoming listed or publicly traded on
      any
      of The Nasdaq Stock Market, the New York Stock Exchange, the American Stock
      Exchange, the London Stock Exchange, the Indonesia Stock Market, the
      Over-the-Counter Bulletin Board, or any other recognized stock exchange; (C)
      a
      private equity offering in which the gross proceeds received by the Company
      is
      equal to or greater than [*]
      U.S.
      Dollars ($ [*]);
      or (D)
      a merger, consolidation or reorganization of the Company with or into any other
      entity or entities, or a sale of all or substantially all of the assets of
      the
      Company, or a series of related similar such transactions in which the Members
      prior to the consummation of such event hold less than 50% of the voting power
      of the surviving entity.

    

    ARTICLE
      III

    Organization
      of the Company

    

    3.1.    Formation. The
      Members hereby establish this limited liability company under the Act by the
      filing the Certificate and by entering into this Agreement for the purpose
      of
      establishing the Project, on the terms and conditions set forth herein. This
      Agreement controls all rights and obligations of the Members and the Economic
      Interest Owners to the fullest extent permitted by law. This Agreement shall
      not
      be effective and the Company shall not exist until the later of the Effective
      Date set forth above and, if different, the date that the Certificate has been
      properly filed with the office of the Delaware Secretary of State. 

    

    3.2.    Name.
      The
      name of the Company shall be “Grain Enhancement, LLC.” The Company may conduct
      business under that name or any other name determined by the Class A
      Members.

    

    3.3.    Term.
      The
      term of the Company will commence on the date of the filing of the Certificate
      and shall terminate as provided under Section 12.

    

    3.4.    Registered
      Office and Agent.
      The
      Company shall continuously maintain a registered agent in the State of Delaware
      as required by Section 18-104(a)(2) of the Act. The initial registered office
      of
      the Company shall be “Grain Enhancement, LLC, care of The Corporation Trust
      Company, 1209 Orange Street, Wilmington, Delaware 19801”. The initial registered
      agent shall be the Corporation Trust Company, 1209 Orange Street, Wilmington,
      Delaware 19801. A Member may change the registered office and/or the registered
      agent at any time and from time to time, as permitted under the Act, upon
      approval of the Class A Members.

    

    3.5.    Purpose
      of the Company; The Project.
      The
      purposes of the Company are: (i) to sublicense
      or otherwise acquire from Pacific Advisors all of the of rights granted to
      Pacific Advisors under that certain License Agreement between NutraCea and
      Pacific Advisors dated June 22, 2007 (and specifically including, without
      limitation, all of Pacific Advisors’ rights to commercialize SRB and related
      products in the Territory and to use certain intellectual property rights in
      the
      Territory with respect to such products), the form of which license agreement
      is
      attached hereto as Exhibit
      D
      (the
“License
      Agreement”);
      (ii)
      within the Territory, to establish, construct, and operate (directly or through
      one or more subsidiaries or other entities) one or more
      rice
      bran stabilization facilities (“Facilities”)
      utilizing
      the proprietary technologies licensed in the License Agreement,;
      (iii)
      to
      manufacture, distribute, sell, advertise, promote, market and otherwise
      commercialize the Products throughout the Territory; and (iv)
      to
      engage in any and all other activities reasonably related to the foregoing
      (collectively, the “Project”).
      In
      addition, the Company may purchase from, and thereafter distribute in the
      Territory certain rice bran derivative products manufactured by NutraCea (the
      “Stage
      2 Products”).
      If
      NutraCea is unable to provide the Company with the amount of such Stage 2
      Products that the Company may, from time to time order from NutraCea, the
      Company may also consider establishing its own Stage 2 Products manufacturing
      facilities in the Territory. The Company shall have all the powers necessary
      or
      convenient to affect any purpose for which it is formed, including all powers
      granted under the Act.
      Without
      the unanimous written consent to all of the Class A Members, the Company shall
      not engage in any business other than the Project.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    3.6.    Special
      Covenants Regarding the Operation of the Company

    

    3.6.1.    Supply
      Agreement; Raw Bran Supply Agreements.
      Until
      the Company produces sufficient Products for its marketing and distribution
      needs in the Territory, the Company shall purchase Products exclusively from
      NutraCea, as set forth in the Supply Agreement of even date herewith attached
      hereto as Exhibit C. Pacific
      Advisors
      has
      advised NutraCea that it has relationships with numerous rice mills in the
      Territory. Pacific Advisors agrees to use commercially
      reasonable
      efforts
      to establish agreements between the Company and rice mills located in the
      Territory to provide an adequate supply of raw rice bran to provide for the
      Company’s requirements for the establishment and operation of the Facilities and
      the production of stabilized rice bran from the Facilities of a quality and
      nature that meets NutraCea’s published specifications (“SRB”)
      as
      contemplated for the successful implementation and operation of the
      Project.

     

    3.6.2.    Sublicense/Assignment.
      Pacific
      Advisors
      agrees
      to sublicense to the Company all of its rights and interests under the
      License
      Agreement.
      The form
      of sublicense agreement to be entered into between the Company and Pacific
      Advisors is attached hereto as Exhibit
      D
      (the
“Sublicense
      Agreement”).
      As
      more specifically set forth in the Sublicense Agreement, upon a Qualifying
      Event, the Company shall acquire all of Pacific Advisors’ rights under the
      License Agreement (but not its obligations to pay licensing fees to NutraCea)
      for a price of [*] U.S.
      Dollars ($ [*]),
      and
      Pacific Advisors hereby agrees to assign to the Company all of its rights under
      the License Agreement for such payment of [*]
      U.S.
      Dollars ($ [*])

     

    3.6.3.    Equipment.
      The
      Company initially intends to engage in the production of stabilized rice bran
      for distribution in the Territory. In order to enable the Company to produce
      the
      stabilized rice bran, NutraCea agrees to lease to the Company, subject to
      availability, for a fifteen year lease term, the rice bran stabilization
      equipment (“Equipment”)
      necessary for and required for each Facility in connection with stabilizing,
      cooling, handling, grinding, sifting and packaging of stabilized rice bran.
      The
      fee that will be payable by the Company to NutraCea to lease such Equipment
      shall be equal to [*]
      and
      shall
      be payable [*],
      due and
      payable within thirty (30) days following the installation of the Equipment
      at
      each Facility. The Members and the Company acknowledge that NutraCea will retain
      all rights, title and interest in the leased Equipment installed at each
      Facility. The lease for the Equipment shall be pursuant to the form of Lease
      attached hereto as Exhibit
      E.
      If the
      Company, as provided in Section 3.5 above, in the future elects to produce
      Stage
      2 Products under the License Agreement, NutraCea agrees to lease the equipment
      to the Company to produce the Stage 2 Products for a lease price equal to
[*]
      and on
      such other terms and conditions as the parties may agree upon in good faith
      negotiations; provided, however, the NutraCea shall not be required to lease
      or
      otherwise provide such Stage 2 Product equipment to the Company if, as a result,
      NutraCea’s intellectual property rights in Stage 2 Product equipment or
      technology would be jeopardized. 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    3.6.4.    Staffing.
      Until
      the Company has hired sufficient employees to conduct its operations,
Pacific
      Advisors
      or an
      Affiliate of Pacific
      Advisors
      shall
      make available or cause to be provided to the Company at Pacific
      Advisors’
actual
      cost all staff reasonably necessary to operate and maintain the
      Facilities.

     

    3.6.5.    Compliance
      with Laws.
      The
      Company shall comply with applicable laws and regulations with respect to
      marketing, labeling, distributing, and selling the Products in the Territory,
      and in any of its dealings with respect to the Products. The Company shall
      also
      obtain all appropriate governmental and legal permits and consents required
      for
      the market and sale of the Products.

     

    3.6.6.    Export.
      The
      Company shall not export, directly or indirectly, any Products to any other
      country or province outside of the Territory without the approval of all of
      the
      Class A Members.

     

    3.6.7.    Feasibility
      Study.
      The
      Company shall engage a prominent independent market consulting firm within
      thirty (30) days after the Effective Date to complete a comprehensive market
      analysis to determine the size of the potential market in the Territory for
      (i)
      the stage 1 SRB to be manufactured by the Company at its Facilities, and (ii)
      all other products that the Company will have the right to manufacture or sell
      under the License.

    

    ARTICLE
      IV

    Capital
      Contributions; Percentage Interests.
      

    

    4.1.    Initial
      Capital.
      Each of
      NutraCea and Pacific
      Advisors
      agree to
      contribute to the Company Five Million U.S. Dollars ($5,000,000) (for a total
      maximum of Ten Million U.S. Dollars ($10,000,000)) (the “Initial
      Capital Contribution”)
      pursuant to the schedule of required contributions set forth in Section 4.2.
      The
      Initial Capital Contribution shall be used by the Company to purchase
      SRB in accordance with Section 3.6.1 above,
      to
      market and sell the Products, to construct, maintain and operate up to two
      Facilities,
      and to otherwise
      initiate
      and conduct the operation of the Project. In the event that not all of the
      Initial Capital Contributions are needed to fully fund the Company’s operations,
      such Initial Capital Contributions shall, upon the approval of the Finance
      Committee, be returned pro rata to NutraCea and Pacific
      Advisors.
      In
      consideration for the Initial Capital Contributions to be made by each Class
      A
      Member, each such member will be allocated a Percentage Interest of forty seven
      and one-half percent (47.5%), which Percentage Interest is subject to reduction
      in the event that the full Initial Capital Contribution is not paid as provided
      in this Agreement. The Class B Members shall not make an Initial Capital
      Contribution.  

    

    4.2    Initial
      Capital Contribution Schedule; Failure to Make Contribution.
      

    

    4.2.1    Schedule;
      Notice.
      The
      Class A Members shall make the Initial Capital Contributions as follows:

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (i)    One
      Million Five Hundred Thousand U.S. Dollars ($1,500,000) each (for a total of
      Three Million U.S. Dollars ($3,000,000)) on or before June 30, 2007;

    

    (ii)    Two
      Million U.S. Dollars ($2,000,000) each (for a total of Four Million U.S. Dollars
      ($4,000,000)) on or before October 30, 2007; and 

    

    (iii)    One
      Million Five Hundred U.S. Dollars ($1,500,000) each (for a total of Three
      Million U.S. Dollars ($3,000,000)) on or before August 31, 2008.

    

    Payments
      not received by the Company within fifteen (15) calendar days of each payment
      date shall be deemed delinquent. 

    

    4.2.2    Failure
      to make Initial Capital Contributions.
      In the
      event that (and on each occasion that) a Class A Member (“Defaulting
      Member”)
      fails
      to make, and becomes delinquent in all or any portion of any Initial Capital
      Contribution payment as and when required to be made under Section 4.2.1, and
      (ii) the other Class A Member timely makes its Initial Capital Contribution
      payment, the Defaulting Member’s Percentage Interest shall be reduced as
      follows: 

    

    (a)    If
      a
      Class A Member fails to make a One Million Five Hundred Thousand U.S. Dollars
      ($1,500,000) Initial Capital Contribution payment if, as and when due pursuant
      to Section 4.2.1, the Percentage Interest of that Defaulting Member shall be
      immediately reduced to a Percentage Interest equal to (i) the number comprising
      the Defaulting Member’s Percentage Interest immediately prior to such default,
      minus (ii) seventeen and 8125/10,000 (17.8125). A separate reduction under
      this
      subsection (a) shall apply for each failure of a Class A Member to make a One
      Million Five Hundred Thousand U.S. Dollars ($1,500,000) Initial Capital
      Contribution payment pursuant to Section 4.2.1. If the Defaulting Member fails
      to contribute only a portion of such amount, the Defaulting Member’s Percentage
      Interest will be reduced by a portion of the foregoing amount equal to the
      portion of the One Million Five Hundred Thousand U.S. Dollar ($1,500,000)
      Initial Capital Contribution payment not timely made by the Defaulting Member.
      

    

    (b)    If
      a
      Class A Member fails to make the Two Million U.S. Dollars ($2,000,000) Initial
      Capital Contribution payment as and when due pursuant to Section 4.2.1, the
      Percentage Interest of that Defaulting Member shall be immediately reduced
      to
      (i) the number comprising the Defaulting Member’s Percentage Interest
      immediately prior to such default, minus (ii) twenty three and 3/4 (23.75).
      If
      the Defaulting Member fails to contribute only a portion of such amount, the
      Defaulting Member’s Percentage Interest will be reduced by a portion of the
      foregoing amount equal to the portion of the Two Million U.S. Dollars
      ($2,000,000) Initial Capital Contribution payment not timely made by the
      Defaulting Member. 

    

    Upon
      a
      reduction of the Percentage Interest of a Defaulting Member, the Percentage
      Interests of the other Class A Member shall be increased by an amount equal
      to
      the reduction of the Defaulting Member. The Percentage Interest of each Member
      as of the Effective Date is set forth on Exhibit
      A
      hereto.
      The Percentage Interests of the Class A Members set forth on Exhibit
      A
      shall be
      adjusted as set forth in this Section 4.2.2 in the event of each and every
      failure by any Class A Member to make any Initial Capital Contribution payments.
      Each of the Class A Members agrees that the provisions of this Section 4.2.2
      are
      fair and reasonable under the circumstances.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
       

    

    4.3.    Percentage
      Interests.
      The
      Members
      shall receive the Percentage Interests set forth in
      the
      definition of Percentage Interest.
      The
      Members shall receive no Capital Account credit for the assignment of rights
      under any license unless specifically agreed in writing by the Class A
      Members.

    

    4.4.    Capital
      Accounts.
      The
      Company shall establish an individual Capital Account for each Member. The
      Company shall determine and maintain each Capital Account in accordance with
      Treasury Regulations Section 1.704-1(b)(2)(iv). Each Member’s Capital Account
      shall initially be credited with the cash Capital Contribution made by such
      Member pursuant to Section 4.1 and the fair market value of the net value of
      contributed property for which a value is specifically agreed upon by the
      Members (if no value is agreed upon, the item shall not be credited to the
      Capital Account.) If a Member transfers the Member’s Membership Interest in
      accordance with this Agreement, such Member’s Capital Account shall carry over
      to the new owner of such Membership Interest pursuant to Treasury Regulations
      Section 1.704-1(b)(2)(iv)(1).

    

    4.5.    Additional
      Capital Contributions.
      From
      time to time, the Members may be permitted to make additional Capital
      Contributions if and to the extent they so desire, and if the Finance Committee
      determines that such additional Capital Contributions are necessary or
      appropriate for the conduct of the Company Project, including without
      limitation, expansion or diversification. In that event, each of the Members
      shall have the opportunity, but not the obligation, to participate in such
      additional Capital Contributions on a pro rata basis in accordance with their
      Percentage Interests for a period of thirty (30) days following notice of the
      decision to permit an additional Capital Contribution. Immediately following
      such Capital Contributions, the Percentage Interests of the Members shall be
      adjusted to reflect the additional Capital Contributions based upon the needs
      of
      the Company, the net value of the Company’s assets, the Company’s financial
      condition and the benefits anticipated to be realized by the additional Capital
      Contributions, all as determined by the Finance Committee. 

    

    4.6    Loans.
      In the
      event additional capital is necessary to meet operating expenses and capital
      expenditures or as otherwise reasonably determined by the Finance Committee,
      the
      Members, from time to time, may loan money to the Company from third parties
      or
      Members for all or a portion of such cash needs. Such loans may be unsecured
      or
      secured by all or a portion of the Company’s assets. Any loan from a Member
      shall be subject to the requirements of Section 5.6. The Members specifically
      acknowledge that no such loans shall be obtained without the express prior
      consent of the Finance Committee. 

     

    4.7    Return
      of Capital Contribution.
      No time
      is agreed upon as to when the Capital Contributions of the Members are to be
      returned or whether the Capital Contributions of the Members will be returned.
      The Members shall not have the right to withdraw or demand return of their
      Capital Contributions nor shall the Members have the right to demand and receive
      property other than cash in return for their Capital Contributions.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    4.8    Adjustment
      upon Grant of Profits Interest.
      In
      connection with the grant of a profits interest in the Company, whether as
      consideration for the provision of services or the grant of other rights to
      or
      for the benefit of the Company by an existing Member acting in a Member
      capacity, or by a new Member acting in a Member capacity or in anticipation
      of
      being a Member, the Company shall increase or decrease the Capital Accounts
      of
      the existing Members to reflect a revaluation of Company property (including
      intangible assets such as goodwill) on the Company's books effective as of
      the
      date immediately before the date the grant of the profits interest in the
      Company occurs. This provision is intended to comply with Treas. Regulation
      Section 1.704-1(b)(2)(iv)(f)(5)(iii). Each of the Members hereby elects to
      apply
      this provision whenever there is a grant of a profits interest in the
      Company.

    

    

    ARTICLE
      V

    Members.
      

    

    5.1.    Classes
      of Members.
      There
      shall be two classes of Members, Class A Members and Class B Members. Each
      class
      shall share in all rights of Members hereunder in proportion to their Percentage
      Interests with the exception that the Class B Members shall have no voting,
      approval, consent or management participation rights and, to the maximum extent
      allowed by law, shall have no rights to information concerning the business
      and
      affairs of the Company. The initial Members of the Company shall be NutraCea,
      Pacific
      Advisors, Theorem,
      and
      Ho’okipa, each of whom is admitted to the Company as a Member effective upon the
      execution by such person of a counterpart signature page to this Agreement.
      NutraCea and the Pacific
      Advisors shall
      be
      Class A Members and Theorem
      and
      Ho’okipa shall be Class B Members. 

     

    5.2.    Admission
      of Additional Members.
      Other
      than substitute Members admitted pursuant to Article IX, additional Members
      may
      be admitted to the Company, only with the consent of all Class A Members and
      as
      set forth below. Any additional Members shall obtain Membership Interests and
      will participate in the management, Taxable Net Income, Taxable Net Losses,
      and
      Distributions of the Company on such terms as are set forth herein. Substitute
      Members and assignees of Members may be admitted only in accordance with Article
      IX. Upon admission of a new or substitute Member, this Agreement shall be
      amended to set forth the name, class of Membership Interest, Capital
      Contribution and Percentage Interest of the new Member and the new Member shall
      enter into this Agreement as amended, subject to the following:

    

    (a)    Capital
      Contribution.
      Each
      additional Member shall make a Capital Contribution in such amount and on such
      terms as the Finance Committee determines to be as appropriate based upon the
      needs of the Company, the net value of the Company’s assets, the Company’s
      financial condition and the benefits anticipated to be realized by the
      additional Member;

    

    (b)    No
      Deemed Termination.
      No
      Member shall be admitted if the effect of admission would be termination of
      the
      Company under Code Section 708(b);

    

    (c)    Compliance
      with Law.
      The
      Members shall comply with all applicable state and federal securities and all
      other applicable laws; and

    

    (d)    Agreement.
      Each
      additional Member shall agree to be bound by the terms of this
      Agreement.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    5.3.    Withdrawals
      or Resignations.
      Any
      Member may withdraw or resign from the Company upon written notice to the other
      Member(s) of the withdrawing Member’s desire to withdraw. Upon such notice, the
      withdrawing Member’s Membership Interest shall immediately terminate and the
      Member shall retain solely an Economic Interest. Such withdrawal shall not
      entitle the withdrawing Member to the return of any of the withdrawing Member’s
      capital contribution.

    

    5.4.    Management
      Assistance by Pacific
      Advisors;
      Management Fee.
      

    

    5.4.1.    Management
      Assistance, Management Fee and Product Net Revenue.
      Pacific
      Advisors shall
      assist the Company with overseeing the operation and maintenance of the Project,
      including supervising
      the selection of the Facilities and the
      production of the Products. The Company shall pay to Pacific
      Advisors a
      “Management
      Fee”
      consisting of (i) a monthly fee facility supervisory management fee (the
“Facility
      Fee”),
      and
      (ii) an incentive fee equal to [*]
      Dollars
      ($ [*])
      (the
“Incentive
      Fee”).
      The
      Incentive Fee shall be payable upon a Qualifying Event. The Facility Fee shall
      initially be equal to [*]
      U.S.
      Dollars ($ [*])
      per
      month until the first Facility is operational. The Facility Fee shall increase
      to [*]
      Dollars
      ($[*])
      after
      the first facility is operational. Thereafter, as additional Facilities are
      established, the Facility Fee shall, from time to time, increase in an amount
      jointly agreed to by the Company and Pacific Advisors, which increase shall
      be
      based on the number and type of additional Facilities and such other factors
      as
      the parties, in good faith negotiations, may consider. The Facility Fee shall
      be
      paid monthly commencing on August 1, 2007 and continuing until the closing
      of a
      Qualifying Event. The management agreement between Pacific Advisors and the
      Company shall terminate upon a Qualifying Event. The management agreement,
      including the rights and obligations under that agreement, may be assigned
      by
      Pacific Advisors. In the event that Pacific Advisors elects to assign the
      management agreement, the Company agrees to negotiate in good faith with the
      assignee for such modifications to the Management Fee as the assignee shall
      reasonably request.

     

    5.4.2.    Other
      Payments and Third Party Costs.
      Except
      as approved in writing by the Finance Committee or specifically authorized
      herein, no Member or Affiliate of a Member is entitled to remuneration for
      services rendered or goods provided to the Company. Upon approval by the Finance
      Committee, the Company shall reimburse the Members and their Affiliates for
      the
      actual cost of goods and materials used by the Company and for organizational
      expenses incurred to form the Company and prepare the Certificate and this
      Agreement, including, without limitation, legal and accounting fees and
      costs.
      Nothing
      contained herein is intended to limit the Company’s obligation to pay directly
      for third party costs payable to non-Affiliates as specified in Section 5.4.1
      that are pre-approved by the Class A Members. 

    

    5.5.    Termination
      of Membership Interest.
      Upon
      (i) the transfer of a Member’s Membership Interest in violation of this
      Agreement, (ii) the occurrence of a Disposition Event as to such Member that
      does not result in the dissolution of the Company or (iii) the withdrawal or
      resignation of a Member in accordance with Section 5.3, the Membership Interest
      of that Member shall be terminated and thereafter that Member only shall be
      an
      Economic Interest Owner, unless such Membership Interest is purchased by the
      Company and/or one or more of the Remaining Members as provided in Section
      10.
      Each Member acknowledges and agrees that such termination or purchase of a
      Membership Interest upon the occurrence of any of the foregoing events is not
      unreasonable under the circumstances existing as of the date
      hereof.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    5.6.    Loans
      and Other Transactions with the Company.
      With
      the express prior approval of the Finance Committee, a Member may loan money
      to
      the Company. Interest shall be payable on any such loans at competitive rates
      for loans of similar character and amount, but not to exceed the maximum usury
      rate permitted for loans as to which no exemption from usury applies. No such
      loan shall constitute a Capital Contribution or increase the Percentage Interest
      of the lending Member unless otherwise agreed by the Finance Committee.

     

    5.7.    Meetings
      of Members.
      No
      annual or regular meetings of the Members are required. However, if meetings
      are
      held, then such meetings shall be held in accordance with this Section 5.7
      and
      applicable law.

    

    5.7.1    Place
      of Meetings.
      Meetings of Members shall be held at any place stated in any proper notice
      of
      meeting.

    

    5.7.2    Power
      to Call Meetings.
      Meetings of the Members may be called by any Class A Member for the purpose
      of
      addressing any matters on which the Members may vote.

      

    5.7.3    Notice
      of Meetings.
      Whenever Members are required or permitted to take any action at a meeting,
      a
      written notice of the meeting shall be given not less than ten (10) days not
      more than sixty (60) days before the date of the meeting to each Member entitled
      to vote at the meeting. The notice shall state the place, date and hour of
      meeting and the general nature of the business to be transacted. No other
      business may be transacted at such meeting. Notice of a Members’ meeting shall
      be given either personally or by mail or other means of written communication,
      addressed to the Member at the address of Member appearing on the books of
      the
      Company or given by the Member to the Company for the purpose of notice. The
      notice or report shall be deemed to have been given at the time when delivered
      personally or deposited in the mail or sent by other means of written
      communication. When a Members’ meeting is adjourned to another time or place,
      except as provided in the last sentence of this paragraph, notice need not
      be
      given of the adjourned meeting if the time and place thereof are announced
      at
      the meeting at which the adjournment is taken. At the adjourned meeting, the
      Company may transact any business that may have been transacted at the original
      meeting. If the adjournment is for more than forty-five (45) days, or if after
      the adjournment a new record date is fixed for the adjourned meeting, a notice
      of the adjourned meeting shall be given to each Member of record entitled to
      vote at the meeting.

    

    5.7.4    Action
      without a Meeting.
      Any
      action that may be taken at any meeting of the Members may be taken without
      a
      meeting if a written consent setting forth the action so taken is executed
      and
      delivered to the Company by Members having not less than the minimum number
      of
      votes that would be necessary to authorize or take that action at a meeting
      at
      which all Members entitled to vote thereon were present and voting. Any Member
      giving a written consent, or the Member’s proxy holder, may revoke the consent
      by a writing received by the Company prior to the time that the written consents
      of Members having the minimum number of votes that would be required to
      authorize the proposed action have been filed with the Company, but may not
      do
      so thereafter. Such revocation is effective upon its receipt at the office
      of
      the Company.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    5.7.5    Proxies.
      The use
      of proxies in connection with this Section 5.7 will be governed in the same
      manner as in the case of corporations formed under the Delaware General
      Corporation Law.

    

    5.8.    Competing
      Activities.
      The
      Members and their Affiliates may not engage or invest in, independently or
      with
      others, any business activity of any type or description that might be in direct
      or indirect competition with the Project within the Territory; provided, that
      NutraCea may purchase raw rice bran from suppliers in the Territory,
      and
      provided further that the activities of Pacific Advisors and its Affiliates
      in
      connection with producing, distributing and selling wheat flour shall not be
      deemed to be a competitive activity.
      

     

    ARTICLE
      VI

    Management
      and Control of the Company.

    

    6.1.    Management
      by Members.
      Subject
      to the provisions of this Agreement relating to actions required to be approved
      by the Finance Committee, the Project and affairs of the Company shall be
      managed and all powers of the Company shall be exercised by or under the
      direction of the Class A Members. Except to the extent that this Agreement
      expressly requires the approval, consent or determination of all Members or
      Class A Members or of Members holding a specified number of Percentage
      Interests, every act or decision done or made by a Majority in Interest of
      the
      Class A Members is the act of the Members. 

    

    6.2.    Finance
      Committee.
      Initially the members of the Finance Committee shall be Brad Edson and
[*].
      Any act
      of the Finance Committee shall require approval of both members of the Finance
      Committee. Nothing in this Section 6 or in this Agreement is intended to require
      that meetings of the Finance Committee be held, it being the intent of the
      Members that meetings are not
      required. Action taken by the Finance Committee may be taken in telephonic
      meetings, personal meetings or by other means, provided that all action take
      and
      approved by the Finance Committee shall be evidenced in writing in a document
      executed by both members of the Finance Committee. No
      member
      of the Finance Committee or other Company officer shall be liable, responsible
      or accountable to the Company or to any Member for any mistake of fact or
      judgment, or doing of failing to do any act, or any loss or damage sustained
      by
      the Company or any Member, unless the loss or damage shall have been the result
      of reckless or intentional misconduct committed fraudulently or in bad faith
      or
      a knowing violation of law by the Finance Committee member. Each of the Members
      acknowledges and agrees that except as provided above, the Finance Committee
      members and any officers shall have no additional fiduciary duties to the
      Company or the Members. In addition to the duties of the Finance Committee
      specifically set forth in this Agreement, the Finance Committee shall be
      responsible for establishing the 12-month and 3-month forecasts of SRB to be
      purchased under the Supply Agreement between NutraCea and the Company.

    

    6.3.    Transactions
      between the Company and the Members.
      Notwithstanding that it may constitute a conflict of interest, a Member may,
      and
      may cause its Affiliates to, engage in any transaction with the Company so
      long
      as such transaction is approved by the Finance Committee and is not expressly
      prohibited by this Agreement and so long as the terms and conditions of such
      transaction, on an overall basis, are fair and reasonable to the Company and
      are
      at least as favorable to the Company as those that are generally available
      from
      Persons capable of similarly performing them and in similar transactions between
      parties operating at arm’s length.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    6.4.    Conflicts
      of Interest.
      Except
      as expressly prohibited hereunder, each Member of the Company at any time and
      from time to time may engage in and possess interests in other business ventures
      of any and every type and description, independently or with others, with no
      obligation to offer to the Company or any Member the right to participate
      therein. To the fullest extent permissible under applicable law, each Member
      waives any claims against the other Members or Manager based on a breach of
      fiduciary duty with respect to any other business ventures of any and every
      type
      and description, independently or with others, except those in competition
      with
      the Company within the Territory.

    

    6.5.    Acts
      of Two Members as Conclusive Evidence of Authority.
      Any
      note, mortgage, evidence of indebtedness, contract, certificate, statement,
      conveyance, or other instrument in writing, and any assignment or endorsement
      thereof, executed or entered into between the Company and any other Person,
      when
      signed by two (2) Class A Members or both Finance Committee members is not
      invalidated as to the Company by any lack of authority of in the absence of
      actual knowledge on the part of the other Person that the signing Persons had
      no
      authority to execute the same.

    

    6.6.    Limited
      Liability.
      No
      person who is a Member of the Company, or any officers, directors, employees
      or
      agents of a Member of the Company, shall be personally liable under any judgment
      of a court, or in any other manner, for any debt, obligation, or liability
      of
      the Company, whether that liability or obligation arises in contract, tort,
      or
      otherwise, solely by reason of being a Member of the Company or an officer,
      director, Finance Committee member, employee or agent of a Member of the
      Company. 

    

    6.7.    Officers
      of the Company; Expenditures. The
      Members may, from time to time, appoint one or more individuals to be officers
      of the Company. Any officers so appointed shall have such authority and perform
      such duties as the Members may, from time to time specifically delegate to
      them;
      provided that no officer shall be entitled to act on behalf of the Finance
      Committee or to take any action requiring the approval of the Finance Committee.
      The use of a title shall not constitute the delegation to such officer of the
      authority and duties that are normally associated with that office. The officer
      shall only have the specific authority and duties established by the Members.
      Any officer may be removed as such, either with or without cause, by the Members
      or the Finance Committee. Officers and other employees of the Company shall
      be
      entitled to such compensation that may be approved by the Finance Committee.
      No
      Member or officer shall have the authority to pay, bind or commit the Company
      with respect to any expenditure without approval of the Finance
      Committee.

    

    ARTICLE
      VII

    Distributions
      of Distributable Cash.
      

    

    7.1.    Distribution
      of Distributable Cash.
      No
      Distributions shall be made to the Members until the Company repays all loans
      to
      the Company by any of the Members under Section 4.6. Thereafter, except as
      otherwise provided in Section 12.3 with respect to Distributions upon
      dissolution and liquidation, Distribution of Distributable Cash shall be made
      in
      the following priority:

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (a)    Unreturned
      Capital Contributions.
      First,
      to the Members in proportion to,
      and to
      the extent of, the Members’ Unreturned Capital Contributions; and 

     

    

    (b)    Percentage
      Interests. Thereafter,
      to the
      Members and holders of Economic Interests in accordance with their Percentage
      Interests.

    

    7.2.    No
      Restoration of Deficit Capital Account Balance.
      No
      Member shall be obligated to contribute to the Company to restore a deficit
      in
      that Member’s Capital Account balance. 

    

    7.3.    Maintenance
      of Working Capital Reserve.
      The
      Finance Committee may set aside out of operating revenues and cash from capital
      transactions, a Working Capital Reserve for repayment of any Company
      indebtedness, for operating expenses and for the replacement or preservation
      of
      any Company asset. Any portion of such Working Capital Reserve that the Finance
      Committee, in its sole discretion, deems unnecessary for the prudent conduct
      of
      Company business may be distributed to the Members in accordance with this
      Section 7.

    

    7.4.    Limitations
      on Distributions.
      No cash
      or property shall be distributed to a Member to the extent that the Distribution
      is prohibited by Section 18-607 of the Act. Any Member who receives a
      distribution from the Company, all or a portion of which is determined to have
      been prohibited by Section 18-607 of the Act, shall, within thirty (30) days
      following notice, return such prohibited portion of the distribution to the
      Company. 

    

    ARTICLE
      VIII

    Allocations
      of Taxable Net Income and Taxable Net Loss.

    

    8.1.    Taxable
      Net Income.
      Taxable
      Net Income shall be allocated to the Members as follows:

    

    (a)    Restoration
      for Prior Net Loss.
      In
      accordance with, and to the extent of, the aggregate Taxable Net Loss allocated
      pursuant to Section 8.2(b) and then that aggregate Taxable Net Loss allocated
      pursuant to Section 8.2(a); and

    

    (b)    Percentage
      Interests.
      Thereafter,
      in
      accordance with
      their
      Percentage Interests. 

     

    8.2    Taxable
      Net Loss.
      Except
      as provided in this Section 8.2 or Section 8.3, Taxable Net Loss shall be
      allocated to the Members as follows:

    

    (a)    Positive
      Capital Accounts.
      First,
      in accordance with their positive Capital Account balances and to the extent
      thereof; and 

    

    (b)    Percentage
      Interests.
      Then,
      in accordance with their
      Percentage Interests.
      

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Notwithstanding
      the previous sentence, loss allocations to a Member shall be made only to the
      extent that such loss allocations will not create a deficit Capital Account
      balance for that Member in excess of an amount, if any, equal to such Member’s
      share of Company minimum gain, as such term is used in Treasury Regulations
      Section 1.704-2(g)(2), that would be realized on a foreclosure of the Company’s
      property. Any loss not allocated to a Member because of the foregoing provision
      shall be allocated to the other Members (to the extent the other Members are
      not
      limited in respect of the allocation of losses under this Section 8.2). Any
      Taxable Net Loss reallocated under this Section 8.2 shall be taken into account
      in computing subsequent allocations of Taxable Net Income and Losses pursuant
      to
      this Section 8, so that the net amount of any item so allocated and the Taxable
      Net Income and Losses allocated to each Member pursuant to this Section 8,
      to
      the extent possible, shall be equal to the net amount that would have been
      allocated to each such Member pursuant to this Section 8 if no reallocation
      of
      Taxable Net Losses had occurred under this Section 8.2.

    

    8.3.    Special
      Allocations.

    

    8.3.1.    Minimum
      Gain Chargeback.
      Notwithstanding Sections 8.1 and 8.2, if there is a net decrease in Company
      minimum gain, as such term is used in Treasury Regulations Section
      1.704-2(g)(2), during any Fiscal Year, each Member shall be specially allocated
      items of Company income and gain for such Fiscal Year (and, if necessary, in
      subsequent Fiscal Years) in an amount equal to the portion of such Member’s
      share of the net decrease in Company minimum gain that is allocable to the
      disposition of Company property subject to a nonrecourse liability, which share
      of such net decrease shall be determined in accordance with Treasury Regulations
      Section 1.704-2(g)(2). Allocations pursuant to this Section 8.3.1 shall be
      made
      in proportion to the amounts required to be allocated to each Member under
      this
      Section 8.3.1. The items to be so allocated shall be determined in accordance
      with Treasury Regulations Section 1.704-2(f). This Section 8.3.1 is intended
      to
      comply with the minimum gain chargeback requirement contained in Treasury
      Regulations Section 1.704-2(f) and shall be interpreted consistently
      therewith.

    

    8.3.2.    Chargeback
      of Minimum Gain Attributable to Member Nonrecourse Debt.
      Notwithstanding Sections 8.1 and 8.2 of this Agreement, if there is a net
      decrease in Company minimum gain attributable to a Member nonrecourse debt,
      during any fiscal year, each Member who has a share of the Company minimum
      gain
      attributable to such Member nonrecourse debt (which share shall be determined
      in
      accordance with Treasury Regulations Section 1.704-2(i)(5)) shall be specially
      allocated items of Company income and gain for such Fiscal Year (and, if
      necessary, in subsequent fiscal years) in an amount equal to that portion of
      such Member’s share of the net decrease in Company minimum gain attributable to
      such Member nonrecourse debt that is allocable to the disposition of Company
      property subject to such Member nonrecourse debt (which share of such net
      decrease shall be determined in accordance with Treasury Regulations Section
      1.704-2(i)(5)). Allocations pursuant to this Section 8.3.2 shall be made in
      proportion to the amounts required to be allocated to each Member under this
      Section 8. The items to be so allocated shall be determined in accordance with
      Treasury Regulations Section 1.704-2(i)(4). This Section 8.3.2 is intended
      to
      comply with the minimum gain chargeback requirement contained in Treasury
      Regulations Section 1.704-2(i)(4) and shall be interpreted consistently
      therewith.

    

    8.3.3.    Nonrecourse
      Deductions.
      Notwithstanding Section 8.3.2, any nonrecourse deductions (as defined in
      Treasury Regulations Section 1.704-2(b)(1)) for any fiscal year or other period
      shall be specially allocated to the Members in proportion to their Percentage
      Interests.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    8.3.4.    Member
      Nonrecourse Deductions.
      Notwithstanding Section 8.3.2, those items of Company loss, deduction, or Code
      Section 705(a)(2)(B) expenditures which are attributable to Member nonrecourse
      debt for any fiscal year or other period shall be specially allocated to the
      Member who bears the economic risk of loss with respect to the Member
      nonrecourse debt to which such items are attributable in accordance with
      Treasury Regulations Section 1.704-2(i).

    

    8.3.5.    Qualified
      Income Offset.
      Notwithstanding Section 8.2, if a Member unexpectedly receives any adjustments,
      allocations, or distributions described in Treasury Regulations Section
      1.704-1(b)(2)(ii)(d)(4), (5) or (6), or any other event creates a deficit
      balance in such Member’s Capital Account in excess of such Member’s share of
      Company minimum gain, items of Company income and gain shall be specially
      allocated to such Member in an amount and manner sufficient to eliminate such
      excess deficit balance as quickly as possible. Any special allocations of items
      of income and gain pursuant to this Section 8.3.5 shall be taken into account
      in
      computing subsequent allocations of income and gain pursuant to this Section
      8,
      so that the net amount of any item so allocated and the income, gain, and losses
      allocated to each Member pursuant to this Section 8.3.5 to the extent possible,
      shall be equal to the net amount that would have been allocated to each such
      Member pursuant to the provisions of this Section 8 if such unexpected
      adjustments, allocations, or distributions had not occurred. 

    

    8.4.    Code
      Section 704(c) Allocations.
      Notwithstanding any other provision in this Section 8, in accordance with Code
      Section 704(c) and the Regulations promulgated thereunder, income, gain, loss,
      and deduction with respect to any property contributed to the capital of the
      Company shall, solely for tax purposes, be allocated among the Members so as
      to
      take account of any variation between the adjusted basis of such property to
      the
      Company for federal income tax purposes and its fair market value on the date
      of
      the contribution. 

    

    8.5.    Allocation
      of Taxable Net Income and Loss and Distributions On Transferred
      Interest.
      If any
      Economic Interest is transferred, or is increased or decreased by reason of
      the
      admission of a new Member or otherwise, during any Fiscal Year, each item of
      income, gain, loss, deduction, or credit of the Company for such Fiscal Year
      shall be assigned pro rata to each day in the particular period of such Fiscal
      Year to which such item is attributable (i.e., the day on or during which it
      is
      accrued or otherwise incurred) and the amount of each such item so assigned
      to
      any such day shall be allocated to the Member based upon his or her respective
      Economic Interest at the close of such day. 

    

    8.6.    Recapture
      Chargeback.
      In the
      event the Company has taxable income chargeable as ordinary income under the
      recapture provisions of the Code, each Member’s share of taxable gain or loss as
      a result of gain from sales shall be allocated, to the extent possible, pro
      rata
      among the Members who received depreciation or cost recovery allocations which
      gave rise to the recapture income until the amount of such prior allocations
      has
      been charged back to such Members.

    

    8.7.    Section
      754 Adjustment.
      To the
      extent an adjustment to the adjusted tax basis of and Company asset pursuant
      to
      Code Section 734(b) or Code Section 743(b) is required to be taken into account
      in determining Capital Accounts, the amount of such adjustment to the Capital
      Accounts shall be treated as an item of gain (if the adjustment increases the
      basis of the asset) or loss (if the adjustment decreases such basis) and such
      gain or loss shall be specially allocated to the Members in a manner consistent
      with the manner in which their Capital Accounts are required to be adjusted
      pursuant to such section of the Treasury Regulations.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    8.8.    Obligations
      of Members to Report Allocations.
      The
      Members acknowledge and agree to the allocations made by this Section 8 and
      agree to be bound by the provisions of this Section 8 in reporting their shares
      of Company income and loss for income tax purposes.

     

    

    ARTICLE
      IX

    Transfer
      and Assignment of Interests.

     

    9.1    Transfer
      and Assignment of Interests.
      No
      Member shall be entitled to transfer, assign, convey, sell, encumber or in
      any
      way alienate the Member’s Membership Interest (collectively, “transfer”)
      except
      with the prior approval of all the other Member(s) that are Class A Members,
      which approval may be given or withheld as the other Member(s) may determine
      in
      its sole discretion. Transfers in violation of this Section 9 shall only be
      effective to the extent set forth in Section 9.4. After the consummation of
      any
      transfer of any part of a Membership Interest, the Membership Interest so
      transferred shall continue to be subject to the terms and provisions of this
      Agreement and any further transfers shall be required to comply with all the
      terms and provisions of this Agreement.

    

    9.2    Substitution
      of Members.
      An
      Assignee shall have the right to become a substitute Member only if (i) consent
      of the Members is given in accordance with Section 9.1, (ii) such person
      executes an instrument satisfactory to the Members accepting and adopting the
      terms and provisions of this Agreement, and (iii) such person pays any
      reasonable expenses in connection with his or her admission as a new Member.
      The
      admission of a substitute Member shall not release the Member who assigned
      the
      Membership Interest from any liability that such Member may have to the
      Company.

    

    9.3    Affiliate
      Transfers.
      The
      Membership Interest of any Member may be transferred subject to compliance
      with
      Section 9.2 by a Member to any Affiliate of the Member.

    

    9.4    Transfers
      in Violation of this Agreement and Transfers of Partial Membership
      Interests.
      Upon a
      transfer in violation of this Section 9, the transferee shall have no right
      to
      vote or participate in the management of the Company or to exercise any rights
      of a Member. Such transferee shall only be entitled to receive the share of
      the
      Company’s Taxable Net Income, Taxable Net Losses and distributions of the
      Company’s assets to which the transferor would otherwise be entitled.
      Notwithstanding the immediately preceding sentences, if, in the determination
      of
      a Majority in Interest of the Remaining Members, a transfer in violation of
      this
      Section 9 would cause the termination of the Company under the Code, the
      transfer shall be null and void.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    ARTICLE
      X

    Consequences
      of a Disposition Event.

    

    10.1    Disposition
      Event.
      Upon
      the occurrence of a Disposition Event, the Company and/or the Class A Members
      other than the Former Member (“Remaining
      Members”)
      shall
      have the option to purchase, and the Member (or his or her legal representative)
      whose actions or conduct resulted in the Disposition Event (“Former
      Member”)
      shall
      sell, the Former Member’s Membership Interest (“Former
      Member’s Interest”)
      as
      provided in this Section 10.

    

    10.2    Purchase
      Price.
      The
      purchase price for the Former Member’s Interest shall be the fair market value
      of the Former Member’s Interest as determined by an independent appraiser
      jointly selected by the Former Member and by the Remaining Members and located
      in the United States of America. The Company and the Former Member shall each
      pay one-half of the cost of the appraisal. Notwithstanding the foregoing, if
      the
      Disposition Event results from a breach of this Agreement by the Former Member,
      the purchase price shall be reduced by an amount equal to the damages suffered
      by the Company or the Remaining Members as a result of such breach.

    

    10.3    Notice
      of Intent to Purchase.
      Within
      thirty (30) days after the fair market value of the Former Member’s Interest has
      been determined in accordance with Section 10.2, each Remaining Member shall
      notify the Class A Members in writing of his or her desire to purchase a portion
      of the Former Member’s Interest. The failure of any Remaining Member to submit a
      notice within the applicable period shall constitute an election on the part
      of
      the Remaining Member not to purchase any of the Former Member’s Interest. Each
      Remaining Member so electing to purchase shall be entitled to purchase a portion
      of the Former Member’s Interest in the same proportion that the Membership
      Interest of the Remaining Member bears to the aggregate of the Membership
      Interests of all of the Remaining Members electing to purchase the Former
      Member’s Interest.

    

    10.4    Election
      to Purchase Less than All of the Former Member’s Interest.
      If any
      Remaining Member elects to purchase none or less than all of his or her pro
      rata
      share of the Former Member’s Interest, then the Remaining Members can elect to
      purchase more than their pro rata share. If the Remaining Members fail to
      purchase the entire interest of the Former Member, the Company shall purchase
      any remaining share of the Former Member’s Interest.

    

    10.5    Payment
      of Purchase Price.
      The
      Company or the Remaining Members, as the case may be, shall pay the purchase
      price within thirty (30) days following the notice set forth in Section 10.3.
      

    

    10.6    Closing
      of Purchase of Former Member’s Interest.
      The
      closing for the sale of a Former Member’s Interest pursuant to this Section 10
      shall be held no later than sixty (60) days after the determination of the
      purchase price. At the closing, the Former Member shall deliver to the Company
      or the Remaining Members an instrument of transfer (containing warranties of
      title and no encumbrances) conveying the Former Member’s Interest. The Former
      Member, the Company and the Remaining Members shall do all things and execute
      and deliver all papers as may be necessary fully to consummate such sale and
      purchase in accordance with the terms and provisions of this
      Agreement.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    ARTICLE
      XI

    Accounting,
      Records, Reporting by Members

    

    11.1.    Books
      and Records; Audit.
      The
      books and records of the Company shall be kept, and the financial position
      and
      the results of its operations recorded, in accordance with the accounting
      methods followed for U.S.
      federal
      income tax purposes. The books and records of the Company shall reflect all
      the
      Company transactions and shall be appropriate and adequate for the Company’s
      business. The Company shall maintain at its principal office, in 5090 North
      40th
      Street, Suite 400, Phoenix, AZ  85018, all of the following and any other
      information required by Section 18-305 of the Act: (i) a current list of the
      full name and last known business, residence or mailing address of each Member
      and Members, both past and present; (ii) a copy of the Certificate and all
      amendments thereto, together with any power of attorney pursuant to which any
      amendment thereto has been executed; (iii) copies of the Company’s federal,
      state and local income tax or information returns and reports, if any, for
      the
      three most recent Fiscal Years; (iv) copies of this Agreement and any amendments
      hereto, and copies of any writings permitted or required under the Act; (v)
      copies of any financial statements of the Company for the three most recent
      Fiscal Years; (vi) minutes of any meetings of Members and any written consents
      obtained from Members; (vii) true and full information regarding the amount of
      cash and a description and statement of the agreed value of any other property
      or services contributed by each Member and which each Member has agreed to
      contribute in the future, and the date on which each became a Member; and (viii)
      the books and records of the Company as they relate to the internal affairs
      of
      the Company for at least the current and past four Fiscal Years. The Company
      shall complete an annual audit by certified public accountants selected by
      NutraCea in accordance with U.S.
      generally
      accepted accounting principles, consistently applied. Complete copies of the
      audit report shall be provided to all of the Class A Members.

    

    11.2    Inspection
      by Members.
      

    

    (a)    Inspection.
      Except
      as provided in Section 11.2(b), any Company records are subject to inspection
      and copying at the reasonable request, and at the expense, of any Member during
      ordinary business hours by such Member or Member’s agent. The Company may impose
      a reasonable charge, not to exceed the estimated cost of labor and material
      for
      production or reproduction, for copies of any documentation provided to a
      Member.  

    

    (b)    Confidentiality.
      Each
      Member shall have the right to keep confidential from the other Members and
      the
      Company, for such period as the Member deems reasonable, any information that
      the Member reasonably believes to be in the nature of trade secrets or other
      information the disclosure of which the Member in good faith believes is not
      in
      the best interest of the Member, of its business, or which the Member is
      required by law or by agreement with a third party to keep
      confidential.

    

    11.3    Reports.
      The
      Company shall cause to be prepared at least annually information necessary
      for
      the preparation of the Members’ federal and state income tax returns. The
      Company shall send or cause to be sent to each Member within ninety (90) days
      after the end of each taxable year such information as is necessary to complete
      federal and state income tax or information returns.

    

    11.4    Bank
      Accounts.
      The
      Company shall maintain the funds of the Company in one or more separate bank
      accounts in the name of the Company, and shall not permit the funds of the
      Company to be commingled in any fashion with the funds of any other person.
      The
      Finance Committee members, acting alone, are authorized to endorse checks,
      drafts, and other evidences of indebtedness made payable to the order of the
      Company, but only for the purpose of deposit into the Company’s accounts. All
      checks, drafts, and other instruments obligating the Company to pay money shall
      be signed in accordance with the requirements of this Agreement.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    11.5.    Tax
      Matters Member.
      The
      Members shall from time to time cause the Company to make such tax elections
      as
      they deem to be in the best interests of the Company and the Members. A Person
      selected by the Finance Committee shall be the “Tax Matters Partner,” as defined
      in Code Section 6231.

    

    ARTICLE
      XII

    Dissolution
      and Winding Up;
      Conversion to Corporation

    

    12.1    Conditions
      of Dissolution.
      The
      Company shall dissolve upon the occurrence of any of the following
      events:

    

    (a)    Election.
      The
      election of the Class A Members or the Finance Committee; or

    

    (b)    Sale.
      The
      sale or other disposition of all or substantially all of the assets of Company
      and the distribution of the proceeds of the sale or other disposition to the
      Members.

    

    12.2    Winding
      Up.
      Upon
      the dissolution of the Company under the Act or this Agreement, the Company’s
      assets shall be disposed of and its affairs wound up and the conduct of the
      Company’s business shall be limited to those matters consistent with the
      disposition of assets and winding up of affairs.

    

    12.3.    Order
      of Payment of Liabilities, Distribution of Assets, Upon
      Dissolution.
      After
      determining that all known debts and liabilities of the Company in the process
      of winding-up, including, without limitation, debts and liabilities to Members
      who are creditors of the Company, have been paid or adequately provided for,
      the
      remaining assets shall be liquidated and the proceeds distributed, after taking
      into account Taxable Net Income and Loss allocations for the Company’s taxable
      year during which the liquidation occurs, to the Members,
      first
      in
      accordance with and
      to
      the extent of their Unreturned Capital Contributions and then, in accordance
      with their remaining
      positive
      Capital Account balances. Such liquidating distributions shall be made by the
      earlier of (i) the end of the Company’s taxable year in which the Company is
      liquidated, or (ii) ninety (90) days after the date of such liquidation.

    

    12.4    Limitations
      on Payments Made in Dissolution.
      Except
      as otherwise specifically provided in this Agreement, each Member shall be
      entitled to look solely to the assets of the Company for the return of the
      Member’s positive Capital Account balance and shall have no recourse for his or
      her Capital Contribution and/or share of Company profits against any other
      Member except as provided in Section 13.

    

    12.5    Conversion
      to Corporation. If
      the
      Class A Members determine that it is in the interest of the Company to become
      a
      corporation, the Company shall become a corporation in such manner as may be
      selected by the Class A Members. The other Members agree to fully cooperate
      and
      hereby provide the Class A Members with a power of attorney to execute all
      documents on their behalf that may be necessary in order to effectuate the
      conversion. As part of the conversion, the Class A Members shall receive
      preferred stock with a liquidation preference and/or redemption right equal
      to
      their Unreturned Capital Contribution and all of the Members shall receive
      the
      common stock to be issued to the Company or directly to the Members in
      accordance with their Percentage Interests.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    ARTICLE
      XIII

    Indemnification
      of Agents.
      

    

    13.1    Indemnification
      of Members.
      The
      Company, its receiver, or its trustee shall indemnify and hold harmless the
      officers, the Class A Members and the Finance Committee members, and each of
      them, and each of their employees, agents, representatives and successors,
      to
      the fullest extent permitted by law, from and against any loss, expense, damage,
      claim, liability, expense or injury suffered or sustained by them because of
      any
      act or omission arising our of their activities on behalf of the Company or
      in
      furtherance of the interests of the Company or their status as a Member,
      officer, Finance Committee member or agent of the Company, including without
      limitation any judgment, award, settlement, attorneys’ fees, and other costs or
      expenses incurred in connection with the defense of any actual or threatened
      action, proceeding, or claim, regardless of whether the indemnified party ceases
      to act in the capacity at the time the liability or expense is paid or incurred
      and regardless of the identity of the party bringing the claim or action.
      Reasonable expenses incurred by an indemnified party in connection with the
      foregoing matters, to the fullest extent permitted by law, shall be paid or
      reimbursed by the Company in advance of the final disposition of such
      proceedings. A Person shall not be denied indemnification hereunder because
      such
      person had an interest in the action to which the indemnification applies,
      if
      the Person is otherwise entitled to indemnity hereunder. 

    

    13.2    Limitation
      on Indemnification.
      Notwithstanding subsection 13.1 above, no Person shall be entitled to or shall
      receive indemnification in respect to any matters that proximately result from
      the person’s fraud, bad faith, gross negligence or willful misconduct or the
      Person’s material breach of this Agreement, unless, and only to the extent that,
      a court or arbitrator of competent jurisdiction determines upon application
      that, despite the misconduct of such Person, under the circumstances, the Person
      is fairly and reasonably entitled to indemnity for those expenses that the
      court
      shall deem proper.

    

    13.3    Indemnification
      on Successful Defense.
      To the
      extent that the Person entitled to indemnification is successful on the merits
      or otherwise in defense of any action, suit, or proceeding referred to in
      Sections 13.1, or in the defense of any claim, issue or matter therein, the
      Company shall indemnify the Person against the expenses, including attorney’s
      fees, actually and reasonably incurred in connection therewith.

    

    ARTICLE
      XIV

    Investment
      Representations.
      

    

    Each
      Member hereby represents and warrants to, and agrees with, the other Members
      and
      the Company as set forth below. 

    

    14.1.    Preexisting
      Relationship or Experience.
      He, she
      or it has a preexisting personal or business relationship with the Company
      or
      the Members, or by reason of his, her or its business or financial experience,
      or the business or financial experience of the financial advisor who is
      unaffiliated with and who is not compensated, directly or indirectly, by the
      Company or any Affiliate or selling agent of the Company, he, she, or it is
      capable of evaluating the risks and merits of an investment in the Company
      and
      of protecting his, her or its own interests in connection with this
      investment.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    14.2.    No
      Advertising.
      He, she
      or it has not seen, received, been presented with, or been solicited by any
      leaflet, public promotional meeting, article or any other form of advertising
      or
      general solicitation with respect to the sale of the Membership
      Interest.

    

    14.3.    Investment
      Intent.
      He, she
      or it is acquiring the Membership Interest for investment purposes for his,
      her
      or its own account only and not with a view to or for sale in connection with
      any distribution of all or any part of the Membership Interest. No other Person
      will have any direct or indirect beneficial interest in or right to the
      Membership Interest.

     

    ARTICLE
      XV

    Miscellaneous.

    

    15.1.    Entire
      Agreement.
      This
      document (including any exhibits and schedules hereto) constitutes the entire
      agreement between the parties
      with
      respect to the subject matter herein and therein,
      all
      oral agreements being merged herein, and supersedes all prior representations.
      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.

    

    15.2.    Interpretation.
      All
      pronouns shall be deemed to refer to the masculine, feminine, or neuter,
      singular or plural, as the context in which they are used may require. All
      headings herein are inserted only for convenience and ease of reference and
      are
      not considered in the interpretation of any provision of this Agreement.
      Numbered or lettered articles, sections and subsections herein contained refer
      to articles, sections and subsections of this Agreement unless otherwise
      expressly stated. In the event any claim is made by any Member relating to
      any
      conflict, omission or ambiguity in this Agreement, no presumption or burden
      of
      proof or persuasion shall be implied by virtue of the fact that this Agreement
      was prepared by or at the request of a particular Member or his or her
      counsel.

    

    15.3.    Severability.
      If any
      provision of this Agreement is held by a court of competent jurisdiction to
      be
      invalid, void, or unenforceable, the remaining provisions shall nevertheless
      continue in full force and effect without being impaired or invalidated in
      any
      way.

    

    15.4.    Notice.
      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 fifth
      business
      day after mailing, if the document is mailed by registered or certified mail,
      (iii) two
      days
      after
      being sent by professional or overnight courier or messenger service, 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 conform to the requirement that mailings be done by registered or
      certified mail shall not defeat the effectiveness of notice actually received
      by
      the addressee.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    If
      to
      NutraCea:

     

    NutraCea

    5090
      North 40th
      Street,
      Suite 400

    Phoenix,
      AZ 85018

    Attn:
      Brad Edson

    

    With
      a
      copy to:

     

    Weintraub
      Genshlea Chediak Law Corporation

    400
      Capitol Mall, Suite 1100

    Sacramento,
      CA 95818

    Attn:
      Chris Chediak

    

    If
      to
      Pacific Advisors Holdings Limited:

    

    Pacific
      Advisors Holdings Limited

    53
      Cairnhill Road

    Cairnhill
      Plaza #12-01

    Singapore
      229664

    Singapore

    Attn:
      President

    

    With
      copy
      to:

    

    Troy
      & Gould

    1801
      Century Park East, 16th Floor

    Los
      Angeles, California 90067

    Attn: Istvan
      Benko

     

    15.5.    Amendment.
      Except
      as specifically provided herein, the provisions of this Agreement may be
      modified, in whole or in part, at any time by consent of a Majority in Interest
      of the Class A Members; provided, however that the unanimous consent of all
      Members affected by the amendment (including the Class B Members, if applicable)
      shall be required for any amendment that would: (i) impose a new material
      obligation on a Member, (ii) reduce the Capital Account of a Member, (iii)
      reduce a Member’s rights to allocations or distributions under this Agreement,
      (iv) modify any provision hereof that imposes a unanimous or super majority
      vote
      of the Members, or (v) amend this Section 15.5. Any such agreement hereafter
      made shall be ineffective to modify this Agreement in any respect with regard
      to
      the matters specified in items (i), (ii), (iii), (iv) or (v) above, unless
      in
      writing and signed by the parties against whom enforcement of the modification
      is sought. In the event that this Agreement is amended and the vote of all
      Members has not been solicited in connection with such amendment, notice of
      any
      approved amendment shall be provided to the Members whose vote was not solicited
      not less than five (5) business days after the amendment becomes effective.
      

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    15.6.    Counterparts.
      This
      Agreement may be executed in any number of counterparts with the same effect
      as
      if the parties had all signed the same document. All counterparts shall be
      construed together and shall constitute one agreement.

    

    15.7.    Attorneys’
      Fees; Prejudgment Interest.
      If the
      services of an attorney are required by any party to secure the performance
      of
      this Agreement or otherwise upon the breach or default of another party to
      this
      Agreement, or if any judicial remedy or arbitration is necessary to enforce
      or
      interpret any provision of this Agreement or the rights and duties of any Person
      in relation thereto, the prevailing party shall be entitled to reasonable
      attorneys’ fees, costs and other expenses, in addition to any other relief to
      which such party may be entitled. Any award of damages following judicial remedy
      or arbitration as a result of the breach of this Agreement or any of its
      provisions shall include an award of prejudgment interest from the date of
      the
      breach at the maximum amount of interest allowed by law.

    

    15.8.    Remedies
      Cumulative.
      No
      remedy or election hereunder shall be deemed exclusive but shall whenever
      possible be cumulative with all other remedies at law or in equity.

    

    15.9.    Succession.
      Subject
      to the provisions otherwise contained in this Agreement, this Agreement shall
      inure to the benefit of and be binding on the successors and assigns of the
      respective parties.

    

    15.10.         
      Specific
      Performance.
      Each
      party’s obligations under this Agreement are unique. The parties each
      acknowledge that, if any party should default in performance of the duties
      and
      obligations imposed by this Agreement, it would be extremely impracticable
      to
      measure the resulting damages. Accordingly, the nondefaulting party, in addition
      to any other available rights or remedies, may sue in equity for specific
      performance, and the parties each expressly waive the defense that a remedy
      in
      damages will be adequate.

    

    15.11.         
      Captions.
      All
      paragraph captions are for reference only and shall not be considered in
      construing this Agreement.

    

    15.12.         
      Time.
      Time is
      of the essence of this Agreement.

    

    15.13.         
      Parties
      in Interest.
      Nothing
      in this Agreement, whether express or implied, is intended to confer any rights
      or remedies under or by reason of this Agreement on any persons other than
      the
      parties to it and their respective successors and assigns, nor is anything
      in
      this Agreement intended to relieve or discharge the obligation or liability
      of
      any third persons to any party to this Agreement, nor shall any provision give
      any third persons any right of subrogation or action against any party to this
      Agreement.

    

    15.14.         
      Further
      Assurances.
      The
      Members shall execute and deliver all such further documents and instruments,
      and take all further actions as may be necessary to consummate the transactions
      contemplated hereby.

    

    15.15.         
      Choice
      of Law.
      The
      laws of the State of Delaware, including, without limitation, the Act, shall
      govern the organization and internal affairs of the Company and the liability
      of
      the Members. Nevertheless, to the extent that reference need be made to the
      law
      of any state to enforce the decision made in any legal proceeding brought
      pursuant hereto, the internal laws of the State of California (without reference
      to the rules regarding conflict or choice of laws of such State) shall be
      utilized for such purpose.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    15.16.         
      Survival.
      The
      indemnification provisions herein shall survive the termination or expiration
      of
      this Agreement.

    

      
        	NutraCea,
                a California corporation
	 	 	 
	
                By:

              	 	 
	 	
                Brad
                  Edson

              
	 	
                Address:
                  5090 North 40th Street, Suite 400

              
	 	
                Phoenix,
                  AZ 85018

              
	 	 
	
                Pacific
                  AdvisorsHoldings Limited, a British 

                Virgin
                  Islands company

              
	 	 	 
	
                By:

              	 	 
	
                 

              	
                
                  (_____________________________)

                

              	
                 

              
	
                Address:

              	
                 

              	 
	 	 
	 	 	 
	Theorem
                Group, LLC, a California limited 
	liability
                company
	 
	
                By:

              	
                 

              	 
	 	
                (_____________________________)

              	 
	Address:
                2049 Century Park East, #3630
	Los
                Angeles, CA 90067
	 	 	 
	Ho’okipa
                Capital Partners, Inc.
	a
                California corporation
	 	 	 
	
                By:

              	
                 

              	 
	 	
                (_____________________________)

              	 
	Address:
                2049 Century Park East, #3630
	Los
                Angeles, CA 90067

      

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
      A

    

    

    Initial
      Capital Contributions

     

    

      
        	
                Member

              	 	
                Contribution

              	 	
                Initial Percentage Interest

              	 
	
                NutraCea

              	 	
                $

              	
                5,000,000

              	 	 	
                47.5

              	
                %

              
	
                Pacific
                  Advisors Holdings Limited

              	 	
                $

              	
                5,000,000

              	 	 	
                47.5

              	
                %

              
	
                Theorem
                  Group, LLC

              	 	
                $

              	
                0

              	 	 	
                [*]

              	
                %

              
	
                Ho’okipa
                  Capital Partners, Inc.

              	 	
                $

              	
                0

              	 	 	
                [*]

              	
                %

              

      

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
      B

     

    Products
      

    

    Stabilized
      rice bran and stabilized rice bran derivative products.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    EXHIBIT
      C

     

    Supply
      Agreement 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    EXHIBIT
      D

     

    License
      Agreement 

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    EXHIBIT
      E

     

    Lease
      Agreement 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    EXHIBIT
      F

     

    Sublicense
      AgreementExhibit
      10.2

    

    [*Designates
      portions of this document have been omitted pursuant to a request
      for

     confidential
      treatment filed separately with the Commission]

    

    SUPPLY
      AGREEMENT

    

    This
      Supply Agreement (“Agreement”)
      is
      entered into and effective on June 22, 2007 (the “Effective
      Date”),
      by
      and between Grain
      Enhancement, LLC, a
      Delaware limited liability company
      (“Company”),
      and
      NutraCea, a California corporation (“NutraCea”)
      on the
      following terms and conditions:

    

    BACKGROUND
      AND PURPOSE

    

    A.     Operating
      Agreement.
      NutraCea and Pacific
      Advisors Holdings Limited (“Pacific
      Advisors”),
      a
      company incorporated under the laws of British Virgin Islands have entered
      into
      an Operating Agreement dated as of June 22, 2007 (“Operating
      Agreement”)
      establishing the Company in order to produce, sell, market and otherwise
      distribute SRB (defined below) throughout the Territory (defined below). The
      Company has obtained a license right from Pacific Advisors to produce SRB
      pursuant to a sublicense of the License Agreement between NutraCea and Pacific
      Advisors dated 22, 2007 (the “License”).
      

    

    B.    
Facilities.
      The
      Company desires to purchase SRB from NutraCea until the Company completes
      construction of sufficient proprietary
      rice bran stabilization facilities (“Facilities”)
      within
      the Territory and can produce sufficient amount of SRB to meet its marketing
      and distribution needs in the Territory.

    

    

    AGREEMENT

     

    1.    Definitions.
      As used
      herein, the following terms shall be defined in the manner set forth
      below:

     

    1.1.    SRB.
      “SRB”
means
      stabilized rice bran and derivatives as set forth in Exhibit
      A
      attached
      hereto, supplied by NutraCea hereunder, of a grade equal to or better than
      the
      grade customarily utilized for human consumption, in accordance with standards
      reasonably established by NutraCea from time to time.

     

    1.2.    Territory.
      “Territory”
means
      the Republic of Indonesia, Vietnam, Thailand, Malaysia, Singapore, Australia
      and
      New Zealand.

    

     

    2.    Quality,
      Ordering; Delivery.

    

    2.1.    Sale.
      NutraCea agrees to sell to Company and Company agrees to purchase exclusively
      from NutraCea all of Company‘s requirements for SRB that are not produced
      directly by the Company. 

    
 

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
       

    

    2.2.    Delivery.
      Title
      and risk of loss of all SRB sold hereunder shall pass to the Company, upon
      the
      SRB and proper documentation being delivered to the carrier at NutraCea’s
      shipping point. 

    

    2.3.    Ordering.
      Purchase orders for the SRB shall be submitted by the Company at least two
      (2)
      weeks prior to the requested delivery date. NutraCea shall acknowledge each
      such
      order following receipt of the purchase orders. If any terms or conditions
      contained in such purchase order or acknowledgement conflict with the terms
      of
      this Agreement, the terms and conditions of this Agreement shall apply to the
      transaction. NutraCea agrees to fill all such purchase orders on the specified
      delivery date, provided that such delivery date is at least ninety (90) days
      after the receipt of the order or a binding forecast. 

     

    3.    Exclusive
      Supply; Obligations of the Parties; Minimum Purchase
      Requirements.

     

    3.1.    Exclusivity.
      During
      the term of this Agreement, and with the exception of all SRB produced by the
      Company from its Facilities, the Company agrees that NutraCea shall be the
      exclusive supplier of Company’s requirements for SRB
      for use
      by Company with
      respect to
      any
      products of Company that include SRB as an ingredient (the “Products”).
      

     

    3.2.    Restrictions.
      Except
      as expressly approved in writing, Company shall not market, sell or distribute,
      directly or indirectly, SRB outside of the Territory or in competition with
      NutraCea in Australia and New Zealand. 

     

    3.3.    Reserved
      Rights.
      NutraCea reserves the right, in its sole discretion, to directly or indirectly
      market and sell its SRB anywhere in the world outside of the Territory, and
      to
      appoint value added resellers, distributors and independent sales
      representatives to directly or indirectly market and sell SRB and any and all
      types of value added products anywhere in the world.

     

    3.4.    Obligations
      of Parties.
      In
      furtherance of this Agreement, Company and NutraCea, as the case may be, shall
      also be responsible for the following, each of which shall constitute a material
      obligation of the party hereunder:

     

    3.4.1.    Company
      Compliance with Laws.
      Company
      shall be solely responsible for complying with applicable laws and regulations
      with respect to marketing, labeling, distributing, and selling the Products
      in
      the Territory, in the performance of its obligations hereunder, and in any
      of
      its dealings with respect to the Products. Company shall also obtain all
      appropriate governmental and legal permits and consents required for the market
      and sale of the Products.

     

    3.4.2.    Training;
      Materials.
      NutraCea shall provide Company with copies of its existing SRB marketing and
      business development materials and other SRB related information available
      to
      NutraCea that would be reasonably useful to assist Company with marketing plans
      and sales training for the Products; provided, however, that such access shall
      not require NutraCea to disclose any information which is confidential product
      and/or proprietary information, and Company shall not use any of these materials
      in Company’s marketing or promotional materials without NutraCea’s express prior
      written consent,
      such
      consent not to be unreasonably withheld or delayed.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    3.4.3.    Conduct
      of Business.
      Company
      shall: (i) conduct its business in a professional and workmanlike manner that
      reflects favorably on NutraCea, the SRB and the Products and in compliance
      with
      all applicable laws in the Territory; (ii) take all reasonable
      actions
      necessary to prevent and avoid deceptive, misleading or unethical practices
      with
      respect to any product; (iii) make no false or misleading representations with
      regard to the Products or SRB; and (iv) make no representations, warranties
      or
      guaranties to anyone with respect to the specifications, features or
      capabilities of the SRB that are inconsistent with NutraCea’s product
      literature.

     

    3.4.4.    Product
      Pricing; Marketing.
      Company
      shall be free to unilaterally determine the prices for the Products. Company
      shall not discriminate unlawfully among customers in prices, terms or in any
      other manner. Company shall be solely responsible for commercializing the
      Products within the Territory, and shall be solely responsible for the manner
      in
      which it will advertise and otherwise promote the Products. Company shall
      develop sales, marketing, advertising, labeling, content, and packaging for
      the
      Products for distribution as set forth herein,
      and
      any
      portion
      of such
      materials that contains claims regarding SRB or utilizes NutraCea trademarks
      or
      logos shall be subject to the prior written approval of NutraCea.

     

    3.4.5.    Forecasts.
      Company
      acknowledges that NutraCea must make long-term commitments for SRB materials.
      As
      such, NutraCea requires that Company provide good faith forecasts of the amount
      of SRB that it anticipates that it will purchase under this Agreement. On or
      before the fifth (5th) day of each calendar month, Company shall provide
      NutraCea with the following: (i) a tentative twelve (12) month forecast of
      Company’s SRB requirements for shipping during each of the next twelve (12)
      months; and (ii) a firm and binding commitment of the minimum amount of SRB
      that
      will be purchased by Company in the next [*].
      The
      Company shall promptly submit a purchase order under Section 2.3 for all SRB
      included in a [*]
      binding
      forecast.

     

    3.4.6.    Labeling.
      Company
      shall not sell any animal grade SRB or derivatives of such product for human
      use
      or consumption. Company shall label all Products containing animal grade
product as
      for
      animal use only and shall notify its customers of this limitation in a
      reasonable manner.

     

    3.4.7.     Storage
      Requirements.
      Company
      acknowledges and agrees that the purchased SRB is perishable and as such,
      Company shall: (i) comply with all reasonable
      SRB
      storage requirements provided by NutraCea; and (ii) be solely responsibility
      for
      the quality control of SRB after its receipt of the SRB.

     

    3.4.8.    No
      Sales Outside of Territory; Export Control.
      Company
      shall not export, directly or indirectly, any of the Products to any other
      country or province outside of the Territory without the express prior written
      consent of NutraCea. If such consent is provided by NutraCea, Company shall
      comply with all export laws, and import and/or export directly or indirectly
      to
      any other country, which export shall be subject to all applicable export laws,
      regulations and rules. Company shall hold NutraCea harmless and indemnify it
      for
      any fines, penalties or other liability (including attorneys’ fees) that result
      from or arise out of Company’s failure to meet these obligations.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    3.4.9.    Product
      Complaints; Notification.
      Company
      shall promptly provide to NutraCea, detailed reports of any comments and
      complaints received by Company relating to problems with SRB. In addition,
      Company shall notify NutraCea in writing of any legal action, claim or
      proceeding involving SRB or Products no later than five (5) days after Company
      learns of any such claim or proceeding.

    

    3.4.10.    Minimum
      Purchase.
       Company
      hereby agrees that (i) within [*]
      calendar
      days following the date of this Agreement, Company shall place an initial
      purchase order with NutraCea for at least [*]
      U.S.
      Dollars ($ [*])
      of SRB
      (the “Initial Purchase Order”) and (ii) within [*]
      from
      the
      date of the Initial Purchase Order, Company, shall place a subsequent purchase
      order with NutraCea for [*]
      U.S.
      Dollars ($ [*])
      of SRB.
      Other than the foregoing purchase order and all amounts forecast in a
[*]
      binding
      commitment pursuant to Section 3.4.5, Company shall not be obligated to purchase
      any additional amount, or any minimum amount, of SRB under this
      Agreement. 

     

    3.4.11.    Supply
      Obligations.
      NutraCea agrees to produce and have available sufficient SRB to fill all amounts
      forecast in a [*]
      binding
      commitment pursuant to Section 3.4.5, and to have such amounts available for
      delivery to Company. 

    

    4.    Prices;
      Payments and Taxes.

    

    4.1.    Prices.
      Until
      the first anniversary of this Agreement, the purchase price of all SRB purchased
      hereunder shall be [*]
      U.S.
      Dollars ($ [*])
      per
      metric ton of SRB. In the event that this Agreement is still in effect after
      the
      first anniversary hereof, the purchase price for all SRB sold to Company under
      this Agreement shall be [*]
      metric
      ton of SRB (including the cost or acquiring the raw rice bran from third party
      sources, but excluding general corporate overhead and other administrative
      costs
      not directly related to the production of the SRB). NutraCea shall provide
      written notification to Company
      of
      price
      increases after the first anniversary no less than sixty (60) days prior to
      any
      such price change. 

    

    4.2.    Payment
      of Prices and Charges.
      Full
      payment of all purchase orders shall be due and payable to NutraCea, in
      immediately available funds, within ten (10) days by wire transfer or by check,
      from the date of delivery to the shipping point as verified by the carrier
      selected to transport the SRB. All prices are exclusive of shipping and handling
      charges, which shall be invoiced to Company.
      All
      payments shall be made in United States Dollars. Company
      shall
      not
      take any credits or offsets against amounts billed Company
      by
      NutraCea without NutraCea’s prior written consent.

    

    4.3.    Late
      Payment.
      Late
      payments shall
      accrue interest at a rate of [*]
      percent
      ([*]
      %)
      per
      month or the maximum permissible statutory rate if it is less. In the event
      that
Company
      fails
      to
      fulfill the terms of payment, NutraCea may decline to make further deliveries
      and suspend its performance under this Agreement until all amounts due are
      paid
      by Company
      in
      full.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    4.4.    Taxes;
      Withholding.
      Any and
      all amounts payable under this Agreement do not include any government taxes
      (including without limitation sales, use, excise, and value added taxes, or
      other taxes or tariffs) or duties imposed by any governmental agency that are
      applicable to the export, import, or purchase of the product(s),
      and
Company
      shall
      bear all such taxes and duties. The foregoing does not apply, however, to income
      taxes payable by NutraCea to state or municipal governments of the United
      States. When NutraCea has the legal obligation to collect such taxes or duties,
      the appropriate amount may be added to Company’s
      invoice and paid by Company
      unless
      Company
      provides
      NutraCea with a valid tax exemption certificate authorized by the appropriate
      taxing authority. Any such taxes which are otherwise imposed on payments to
      NutraCea shall be the sole responsibility of Company.
      Company
      shall
      hold NutraCea harmless for any taxing authority or such other responsibility
      relative to this issue. All payments by Company
      specified
      in this Agreement are expressed as net amounts and shall be made free and clear
      of, and without reduction for, any withholding taxes, unless otherwise provided
      in this Agreement. Any such taxes which are otherwise imposed on payments to
      NutraCea shall be the sole responsibility of Company.
      If any
      applicable law requires Company
      to
      deduct
      or withhold amounts from any payments to NutraCea under this Agreement,
Company
      shall
      effect such deduction or withholding, remit such amounts to the appropriate
      taxing authorities and promptly furnish NutraCea with tax receipts evidencing
      the payments of such amounts. NutraCea shall provide all such assistance as
      Company
      may
      reasonably require in obtaining such withholding tax certificates. 

     

    5.    Term
      and Termination.

    

    5.1.    Term.
      Subject
      to Section 5.2 below, the term of this Agreement shall commence as of the
      Effective Date and shall continue for a period of [*].
      Thereafter, the term shall continue on a month to month basis until terminated
      by either party in writing upon [*]
      days
      written notice. 

    

    5.2.    Termination.
      Notwithstanding the foregoing, the indicated Party shall have the right to
      terminate this Agreement with immediate effect upon the occurrence of one of
      the
      following:

    

    (a)    If
      either
      Party has become insolvent or bankrupt or has resolved to dissolve or liquidate
      or be acquired, the other Party may terminate this Agreement without liability
      to either Party.

    

    (b)    If
      either
      Party has committed a material breach of this Agreement and has failed to cure
      such breach within thirty (30) days following notification of such breach by
      the
      other Party or such breach cannot be cured, the other Party shall have a right
      to terminate; provided, however, that the right to cure a breach for non-payment
      of invoices shall be five (5) business days.

    

     

    6.    Warranties
      and Indemnity.

    

    6.1.    Warranty.
      [*].
      Payment
      for goods specified herein shall not constitute an acceptance thereof. If
      determined to be non-conforming pursuant to the foregoing provisions, SRB may
      be
      rejected by returning it for credit or replacement at the Company’s risk, and
      all handling and transportation expenses both ways will be assumed by the
      Company. Except as set forth in this Agreement, neither Company nor NutraCea
      makes any representations or warranties of any kind, whether express or implied
      (including without limitation any implied warranty of merchantability or fitness
      of the Products for a particular purpose), under this Agreement.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    6.2.    Claims.
      Company
      shall notify NutraCea upon notification of any claim made against the
      Products.

    

    6.3.    Technical
      Service.
      At the
      request of Company, NutraCea shall furnish such technical advice (at no material
      cost to NutraCea) as it has reasonably available to Company with respect to
      the
      SRB and Products.

    

    

    7.    Limitation
      of Liability.

    

    7.1.    Limitation.
      IN NO
      EVENT WILL EITHER PARTY OR ITS AFFILIATES
      BE
      LIABLE TO THE OTHER PARTY OR
      ANY
      THIRD PARTY FOR
      LOST
      PROFITS, DATA OR BUSINESS, OR FOR ANY INDIRECT, SPECIAL, INCIDENTAL, EXEMPLARY
      OR CONSEQUENTIAL DAMAGES OF ANY KIND ARISING OUT OF OR IN CONNECTION WITH THIS
      AGREEMENT, HOWEVER CAUSED AND ON ANY THEORY OF LIABILITY (WHETHER IN CONTRACT,
      TORT (INCLUDING NEGLIGENCE, STRICT LIABILITY OR OTHERWISE). THE
      LIMITATIONS SET FORTH IN THIS SECTION WILL APPLY EVEN IF A
      PARTY
      HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, AND NOTWITHSTANDING ANY
      FAILURE OF ESSENTIAL PURPOSE OF ANY LIMITED REMEDY.

    

    7.2.    Waiver.
      NUTRACEA MAKES NO WARRANTIES OR REPRESENTATIONS AS TO THE PERFORMANCE OF THE
      SRB, EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT. ALL IMPLIED WARRANTIES,
      INCLUDING WITHOUT LIMITATION ANY IMPLIED WARRANTIES OF MERCHANTABILITY AND
      FITNESS FOR A PARTICULAR PURPOSE ARE HEREBY EXCLUDED. 

    

    

    8.    Confidentiality.

    

    8.1.    Definition.
      “Confidential
      Information”
means
      any information or compilation of information which is disclosed by one party
      hereto (“Disclosing
      Party”)
      to
      another party (“Receiving
      Party”)
      hereunder, which is proprietary to the Disclosing Party and which relates to
      its
      existing or reasonably foreseeable business, including, but not limited to,
      trade secrets and information contained in or relating to product designs,
      manufacturing methods, processes, techniques, tooling, sales techniques,
      marketing plans or proposals, pricing and sales information, financial
      information, existing or potential customer lists and all other customer
      information. Information shall be treated as Confidential Information
      irrespective of its source and all information which the Disclosing Party
      identifies as being “confidential” or “trade secret” shall be presumed to be
      Confidential Information. Notwithstanding the above, the term Confidential
      Information shall not include information:

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    (a)    which
      was
      in the public domain at the time of disclosure by the Disclosing Party to the
      Receiving Party;

    

    (b)    which
      is
      published or otherwise comes into the public domain after its disclosure to
      the
      Receiving Party through no violation of this Agreement, by the Receiving
      Party;

    

    (c)    which
      is
      disclosed to the Receiving Party by a third party not under an obligation of
      confidence;

    

    (d)    which
      is
      already known by the Receiving Party at the time of its disclosure to the
      Receiving Party by the Disclosing Party as evidenced by written documentation
      of
      the Receiving Party existing prior to such disclosure;

    

    (e)    which
      is
      independently developed by the Receiving Party through persons who have not
      had,
      either directly or indirectly, access to or knowledge of the Confidential
      Information of the Disclosing Party, as evidenced by written documentation
      of
      the Receiving Party; or

    

    (f)    which
      is
      required to be disclosed by any law or governmental regulation or produced
      under
      order of a court of competent jurisdiction; provided, however, that the
      Receiving Party provide the Disclosing Party written notice of such request
      or
      order and Disclosing Party is provided with an opportunity to attempt to limit
      such disclosure.

     

    8.2.    Nondisclosure.
      During
      the term of this Agreement and at all times thereafter, the Receiving Party
      agrees to hold in strictest confidence and to never disclose, furnish,
      communicate, make accessible to any person or use in any way for the Receiving
      Party’s own or another’s benefit any Confidential Information or permit the same
      to be used in competition with the Disclosing Party. The Receiving Party agrees
      to use prudent and reasonable means to protect the Confidential Information.
      

     

    8.3.    Injunctive
      Relief.
      In the
      event of any breach of this Section 8, the parties agree that the non-breaching
      party will suffer irreparable harm for which money damages would be an
      inadequate remedy. Accordingly, the non-breaching party shall be entitled to
      seek injunctive relief, in addition to any other available remedies at law
      or in
      equity.

     

    9.    Miscellaneous.

     

    9.1    Assignment.
      Neither
      party may assign any of its rights or obligations under this Agreement to any
      third party without the other party's prior written consent; provided, however,
      that either party may assign its rights and obligations hereunder without the
      other party's consent to a third party that is acquiring or merging with such
      party or that is purchasing all or substantially all of such party's assets
      (or
      the line of business) that are the subject matter of this Agreement, provided
      that the assignee expressly assumes all of such party's rights and obligations
      under this Agreement. 

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    9.2.    Notices.
      All
      notices required hereunder shall be sent by certified mail return receipt
      requested, express courier with a nationally recognized courier service or
      by
      telex confirmed by such certified mail, to the party to be notified at its
      following address or at such other address as shall have been specified in
      written notice from the party to be notified.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

       

         If
      to
      NutraCea:

    

    NutraCea
      

    5090
      North 40th
      Street,
      Suite 400

    Phoenix,
      AZ 85018

    Attn:
      Brad Edson

    

    With
      a
      copy to:

    

    Weintraub
      Genshlea Chediak Law Corporation

    400
      Capitol Mall, Suite 1100

    Sacramento,
      CA 95818

    Attn:
      Chris Chediak

    

    If
      to
      Company:

    

    Grain
      Enhancement, LLC

    5090
      North 40th Street, Suite 400

    Phoenix,
      AZ  85018

    Attn:
      President

     

    9.3.     Entire
      Agreement.
      The
      foregoing is the parties’ entire agreement, superseding all prior oral or
      written agreements and understandings with respect to the subject matter hereof.
      

    

    9.4.    Modification
      and Amendment.
      This
      Agreement may be modified or amended only in writing and signed by both
      parties.

    

    9.5.    Survival.
      The
      provisions of this Agreement that by their terms or context are intended to
      survive termination of this Agreement, shall so survive the termination of
      this
      Agreement.

    

    9.6.    Governing
      Law.
      The
      parties agree that this Agreement shall be governed by the laws of the State
      of
      California. Company and NutraCea expressly agree that any action at law or
      in
      equity arising under this Agreement shall be filed only in the Courts of the
      State of California in a county of competent jurisdiction or the United States
      District Court in a California district of competent jurisdiction. The parties
      hereby consent and submit to the personal jurisdiction of such courts for the
      purposes of litigating any such action.

    

    9.7.    Recovery
      of Legal Fees and Costs.
      In the
      event any litigation is brought by either party in connection with this
      Agreement, the prevailing party in such litigation shall be entitled to recover
      from the other party all the costs, attorneys' fees and other expenses incurred
      by such prevailing party in the litigation.

    

    9.8.    Counterparts.
      This
      Agreement may be signed in one or more counterparts, each of which shall be
      deemed an original, but all of which together shall constitute one and the
      same
      Agreement.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    9.9.    Binding
      Agreement.
      This
      Agreement shall be binding upon and inure to the benefit of each of the parties
      hereto, and their respective legal successors and permitted assigns.

    

    9.10.    Waiver.
      Performance of any obligation required of a party hereunder may be waived only
      by a written waiver signed by the other party, which waiver shall be effective
      only with respect to the specific obligation described therein.

     

    9.11.    Severability.
      If one
      or more provisions of this Agreement are held to be unenforceable under
      applicable law, such provision shall be excluded from this Agreement and the
      balance of the Agreement shall be interpreted as if such provision were so
      excluded and shall be
      enforceable in accordance with its terms.

     

    9.12.    Publicity.
      Neither
      party shall disclose
      the terms
      of
      this Agreement without the prior written consent of the other party, except
      as
      may be required by applicable law, in which event, the disclosing party shall
      endeavor to give the non-disclosing party prompt notice in order to allow the
      non-disclosing party the opportunity to seek a protective order. Notwithstanding
      any of the foregoing to the contrary, (i) the terms and conditions of this
      Agreement may be disclosed by a party to bona fide potential investors,
      acquirors or partners of such party in the course of such person’s due diligence
      investigation of such party, where such person has entered into a written
      non-disclosure agreement with such party that includes terms no less restrictive
      than those included herein,
      and
      (ii) either party may disclose the existence of this Agreement.

     

    9.13.    Indemnification.
      Notwithstanding the availability and policy limits of any insurance, each party
      shall defend, indemnify and hold the other, and its subsidiaries, divisions
      and
      affiliates and their respective officers, directors, agents and employees,
      harmless from and against any and all losses, claims, liabilities, damages
      and
      legal actions, including reasonable attorneys’ fees and court costs, resulting
      from, arising out of, or relating to (i) any breach by the indemnifying party
      of
      any representation,
      warranty, covenant or agreement made by of such party set forth herein; and
      (ii)
      the inability or failure of the indemnifying party to perform any of its
      obligations under this Agreement, except where the claims or legal actions
      are
      the sole result of the other party’s own negligent acts or omission. This
      provision shall survive the termination, completion or expiration of this
      Agreement. 

    

    9.14.    Further
      Action.
      The
      parties agree to take all action necessary or useful to complete and accomplish
      the intentions of this Agreement.

    

    9.15.    Relationship
      of the Parties.
      Nothing
      contained herein shall be construed to make Company the agent of NutraCea or
      NutraCea the agent of Company for any purpose, except as specifically set forth
      herein, and neither party shall have any right whatsoever to incur any
      obligations on behalf of or binding upon the other party, except as specifically
      set forth herein. Company agrees that at all times it shall act as an
      independent contractor in accordance with the terms of this Agreement, as
      amended hereby, and that it shall not at any time represent orally or in writing
      to any person or entity that it has any right, power or authority not expressly
      granted by this Agreement.

    
       

      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    9.16.    Force
      Majeure.
      No
      liability shall result from delay in performance, or non-performance; caused
      by
      circumstances beyond the control of the party affected. including, but not
      limited to, an act of God, fire, flood, war, Government action, accident, labor
      trouble or shortage, inability to obtain material, utilities, equipment or
      transportation. Quantities so affected may be eliminated from this Agreement
      without liability, but this Agreement shall remain otherwise unaffected. Any
      party claiming the benefit of this Section 9 shall promptly so notify the other
      party.

    

    

    

    

    

    

    

    [SIGNATURE
      PAGE TO FOLLOW]

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    The
      authorized representatives of the parties have executed this Agreement as of
      the
      Effective Date.

     

     

    
      	 NutraCea:	 Grain
              Enhancement, LLC:
	 	 
	 	 
	 By:
              ______________________________	 By:
              ________________________________
	 	 
	 Title:_____________________________	  Title:
              _______________________________

    

     

    

     

    

    

    
 

    [SIGNATURE
      PAGE TO SUPPLY AGREEMENT]

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    Exhibit
      A

    

    SRB
      

    

    Stabilized
      Rice Bran and the stabilized ran bran solubles and stabilized rice bran
      insoluble derivatives (from stage 2 processing)

     

    Specifications

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00128-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00128-of-00352.parquet"}]]