Document:

Exhibit 10.18

    
      

    

     

    
      	
              [*]
                designates
                portions of this document that have been omitted pursuant to a
                request

              for
                confidential treatment filed seperately with the
                Commission

            

    

     

    
      Exhibit
        10.18
PRODUCTION
      FACILITY

    DEVELOPMENT
      AND RICE BRAN

    SUPPLY
      AND PURCHASE AGREEMENT

    

    This
      Production Facility Development and Rice Bran Supply Agreement ("Agreement")
      is
      entered into effective as of September 13, 2005 (“Effective
      Date”)
      by and
      between NutraCea, a California corporation with a principal mailing address
      at
      1261 Hawk’s Flight Court, El Dorado Hills, California 95762 ("NutraCea"),
      Food
      Trading Company Dominicana, S.A., a Dominican corporation with principal mailing
      address at Calle Manuel de Jesus Troncoso No. 18, Ensanche Paraiso, Santo
      Domingo, Dominican Republic (“FTCD”).
      The
      parties, as of the Effective Date, agree as follows:

    

    
      	
              1.

            	
              Background
                and Purpose.
                

            

    

    

    1.1.     NutraCea.
      NutraCea is a nutritional foods company that develops proprietary and patented
      nutraceutical products for human and animal consumption. NutraCea recently
      entered into an agreement to combine with The RiceX Corporation (“RiceX”).
      The
      combined companies posses proprietary technology to stabilize rice bran and
      an
      additional process that converts and enhances stabilized rice bran into
      proprietary value-added products. This proprietary technology and other
      proprietary processes owned by NutraCea and RiceX allow for Stabilized Rice
      Bran
      (as defined in Section 2.1) to be processed into fiber and predigested fiber
      (“Solubles”).

    

    1.2.     Food
      Trading Company Dominicana.
      FTCD
      owns and operates a substantial rice milling operation located in the Dominican
      Republic currently producing approximately 20,000 metric tons of rice annually
      (“FTCD
      Mill”).
      FTCD
      is in the process of acquiring another substantial rice mill that operates
      in
      the Dominican Republic. Upon completion of the acquisition FTCD has represented
      to NutraCea that FTCD will have combined milling facilities processing
      approximately twenty percent (20%) of the country’s production, equating to
      approximately 50,000-60,000 metric tons per year. FTCD currently purchases
      20,000 metric tons of rice from the United States. FTCD has existing retail
      distribution through various retail outlets in the marketplace and a history
      of
      successfully producing and distributing rice-based products in the Dominican
      Republic. 

    

    1.3.     The
      Company.
      In
      order to conduct their joint business operations hereunder, the parties have
      agreed to form one or more entities in accordance with requirements of Section
      3. The type of entity or entities to be formed will be mutually determined
      by
      the parties in a manner reasonably anticipated to minimize the tax liabilities
      of the parties and to allow for effective business operations in the Dominican
      Republic and Haiti as contemplated hereunder. The entity or entities will be
      owned fifty percent (50%) by NutraCea and fifty percent (50%) by FTCD, as
      specified in Section 3, and are collectively referred to herein as the
“Company”).

     

    1.4.     Production
      Facility.
      Both
      NutraCea and FTCD has agreed that NutraCea will either install stabilization
      equipment at the FTCD Mill and construct one or more proprietary two stage
      stabilization, conversion and enhancement facilities within the Dominican
      Republic, or construct an additional production facility or improve an existing
      production facility in the United States of America sufficient to fulfill its
      Solubles supply obligations hereunder (“Production
      Facility”).
      If
      the Production Facility is constructed in the Dominican Republic and
      stabilization equipment is placed at the FTCD Mill, FTCD will supply all of
      the
      required raw rice bran requested by NutraCea for the purpose of stabilization
      of
      the rice bran, all on the terms and conditions set forth herein. The parties
      intend that the Stabilized Rice Bran, Solubles and all value-added products
      produced hereunder (“Products”)
      will
      be sold and commercialized by the Company, through retail outlets and
      distributed through government sponsored feeding programs within the Dominican
      Republic and Haiti (“Business”).
      Initially, the Products will comprise individual servings of 15 grams of
      NutraCea’s Solubles mixture, with such added vitamins as the parties may
      mutually agree upon, mixed with water and packaged for individual consumption
      (“Servings”). The parties may add additional products in the future by mutual
      agreement and shall specify any such additional Products by executing a written
      amendment to this Agreement.

    
      
        
        

      

      
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              2.

            	
              Stabilization
                Equipment and Production Facility.
                

            

    

    

    2.1.     Installation
      of Stabilization Equipment.
      Unless
either
      party, at its option and as provided in Section 2.6 below, elects to proceed
      with the Alternate Production Arrangement (as defined in Section 2.6) and for
      NutraCea to create sufficient production facilities in the United States of
      America to fulfill its supply obligations hereunder, NutraCea will, at its
      own
      expense, provide and install in the FTCD Mill all components and hardware
      (“Equipment”)
      necessary for and required in connection with stabilizing, cooling, handling,
      grinding, sifting and packaging of full fat stabilized rice bran and/or enhanced
      full fat stabilized rice bran (“Stabilized
      Rice Bran”)
      in a
      capacity to produce at least 5,000 metric tons of Stabilized Rice Bran per
      year.
      NutraCea agrees that the proper design of the Equipment requires that certain
      devices and systems, such as metal detectors, magnets and sifters are an
      integral and necessary part of the process to ensure, among other things, the
      purity and wholesomeness of the product, and NutraCea agrees to incorporate
      such
      components into the design of the Equipment. The parties acknowledge that
      NutraCea will retain all rights title and interest in the Equipment installed
      at
      the FTCD Mill and that FTCD will have no right, title or interest in or to
      the
      Equipment. The
      parties acknowledge that FTCD will retain all rights, title and interest in
      the
      Land (as defined in Section 2.2 below) subject only to the lease that may be
      granted under Section 2.2. Upon any termination of any lease granted under
      Section 2.2, FTCD will own all rights, title and interest in the
      Land.

    

    2.1.1.     FTCD
      Mill.
      Unless
      either party elects to proceed with the Alternate Production Arrangement
      pursuant to Section 2.6, FTCD
      will
      provide physically segregated facilities for the Equipment at the FTCD Mill
      of
      at least 5,000 square feet, and NutraCea agrees that the space occupied by
      the
      Equipment and warehouse will not exceed 5,000 square feet. FTCD will take all
      action necessary to make certain that the Equipment has reasonable access to
      sufficient electricity (including a central distribution panel near the
      Equipment), water, sewer and other utilities to operate and maintain the
      Equipment, and the Equipment will be located conveniently near existing rice
      bran storage and processing areas. FTCD agrees that and will ensure that
      NutraCea and Company employees and agents will have unrestricted access to
      the
      Equipment during all business hours and the Equipment will not be accessible
      by
      any other persons without the express prior consent of NutraCea.

    

    2.1.2.     FTCD
      Assistance and Support.
      In
      connection with the installation of the Equipment, if applicable, FTCD, at
      no
      cost to NutraCea, will provide NutraCea with such reasonable engineering, labor
      and professional assistance in selecting and purchasing components for the
      Equipment and contractors to install the Equipment, as well as planning and
      supervising the installation and moving of the Equipment within the Dominican
      Republic, as NutraCea reasonably requests. FTCD will provide to NutraCea, at
      no
      cost to NutraCea, training and technical support (including, without limitation,
      reasonable on-site consultation) to enable NutraCea and Company to start and
      tune, and thereafter to efficiently and safely clean, maintain and operate
      the
      Equipment. NutraCea or its agents or the Company will from time to time make
      reasonable modifications and/or improvements to the Equipment in order to
      improve the efficiency or cost-effectiveness of cleaning, sanitizing, operating,
      maintaining or repairing the Equipment. The Company will pay all approved fees,
      costs and expenses (including, without limitation all material, labor,
      transportation and professional fees, costs and expenses) incurred in connection
      with any such modifications and/or improvements unless otherwise agreed in
      writing by the parties.

    
      
        
        

      

      
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    2.2.     Production
      Facility.
      NutraCea and
      FTCD
      agree to
      construct or improve a Production Facility for processing the Stabilized Rice
      Bran into bulk Stabilized Rice Bran Solubles dry mixture, which the Company
      will
      combine with water and package into the Solubles Servings, and into such other
      Products as the parties may hereafter mutually agree upon, from time to time.
      Unless the Production Facility is constructed or improved under the Alternate
      Production Arrangement, the facility shall be constructed to comply with the
      requirements and specifications agreed upon by the parties and which, once
      agreed upon, shall be attached as Exhibit A hereto (“Specifications”).
      If
      NutraCea and FTCD decide to proceed with the construction of the Dominican
      Republic Production Facility, FTCD shall grant to NutraCea a ground lease for
      one United States dollar ($1.00 U.S.D.) per year for land of location and
      quality reasonably acceptable to NutraCea and in conformity with the development
      criteria established by NutraCea pursuant hereto (“Land”),
      on
      which the initial Production Facility shall be constructed. The ground lease
      shall be a ten year lease with two ten year extensions, exercisable at the
      election of NutraCea and FTCD, and shall be in the form and of content
      reasonably acceptable to the parties. FTCD shall take all action and make all
      arrangements necessary or useful such that the Land has all governmental
      approvals, zoning, and entitlements necessary or appropriate for construction
      of
      the Production Facility and its operation as contemplated hereunder. In the
      alternative, NutraCea and FTCD may mutually agree to assign the Lease to the
      Company; with a contribution value of one United States dollar ($1.00 U.S.D.)
      and FTCD will have the right to terminate the Lease on any dissolution of the
      Company.

    

    2.2.1.     Construction.
      NutraCea will engage an architect to prepare plans and design concepts for
      the
      Production Facility building in the Dominican Republic (unless the parties
      do
      not proceed with a facility in the Dominican Republic). At such time as the
      parties decide to proceed with a Production Facility in the Dominican Republic,
      NutraCea agrees to commence preparation of plans and specifications for the
      Production Facility (“Production
      Facility Plans”)
      within
      forty-five days after the date of entering into the Lease for the Land and
      to
      complete such plans and specifications and provide a copy thereof to FTCD for
      submission to the appropriate governmental agencies for approval, within ninety
      days after such commencement. FTCD shall diligently pursue issuance of all
      necessary building permits and governmental approvals. Construction shall
      commence following delivery to NutraCea by FTCD of possession of the
      leasehold rights in the Land accepted
      by
      NutraCea pursuant to the Lease with all necessary governmental approvals,
      zoning, and entitlements for the Land and Production facility plans and pursuant
      to such development criteria that NutraCea or the Company will provide to FTCD,
      including without limitation, utilities, access and other requirements. NutraCea
      agrees to accept the Land, subject to NutraCea’s verification, to its reasonable
      satisfaction, that the Land complies with NutraCea’s development criteria,
      satisfaction of the other requirements set forth in Section 2.1 and compliance
      with all governmental requirements therefor and in accordance with all
      requirements set forth in the Lease. 

    
      
        
        

      

      
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    Within
      thirty days after FTCD provides the Land, then in accordance with the Production
      Facility Plans and applicable governmental permits and approvals, NutraCea
      will
      sublease the Lease to the Company, and agrees to commence construction of the
      Production Facility (subject to the right to revise the plans) and to complete
      the construction of the Production Facility within twenty-four months of
      commencement of the construction. Any prevention, delay or stoppage due to
      strikes, lockouts, labor disputes, acts of God, inability to obtain labor or
      materials or reasonable substitutes therefore, governmental restrictions,
      governmental regulations, governmental controls, enemy or hostile governmental
      action, civil commotion, fire or reasonable casualty, and other causes beyond
      the reasonable control of NutraCea and shall exclude the performance by NutraCea
      for a period equal to any such prevention, delay or stoppage.

    

    If
      at any
      time during the term of this Agreement FTCD is not able to timely provide the
      Land for, or bring the utilities to, or obtain all necessary governmental
      permits and approvals for the Production Facility, or timely complete any
      necessary Off-Site Improvements (as defined below), then at the election of
      either NutraCea or FTCD, the parties shall proceed with the Alternate Production
      Arrangement or terminate this Agreement and the Lease and FTCD shall repay
      NutraCea for all amounts expended by NutraCea to so complete such work, plus
      interest (at a rate equal to the Bank of America’s reference rate, plus six
      percent, but not to exceed the maximum legal rate and NutraCea may deduct such
      amounts (as well as the amount of any other damages suffered by NutraCea) from
      any payments due to FTCD under this Agreement, until such amounts, plus
      interest, are fully reimbursed to NutraCea.

    

    2.2.2.     Offsite
      Improvements.
      Any
      improvements to any adjacent property to the Leased property are required in
      connection with the construction of the Production Facility are referred to
      herein as "Off-Site
      Improvements."
      No
      later than thirty days after entering into the Lease for the Land, FTCD shall
      provide specifications for construction and installation of all Off-Site
      Improvements, including, by way of example rather than limitation, widening
      of
      streets, sewer lines (including trunk sewers), gutters, curbs, storm drains,
      wells, and installation of necessary utilities to the Production Facility,
      and
      all other Off-Site Improvements required for compliance with applicable
      governmental requirements. All Off-Site Improvement plans shall be subject
      to
      the prior written approval of both FTCD and NutraCea, which approvals shall
      not
      be unreasonably withheld. 

    

    2.2.3.     Construction
      Contracts.
      FTCD
      shall engage, and supervise the performance of, one or more contractor for
      the
      purpose of constructing any Off-Site Improvements, so that all such improvements
      shall be substantially completed as necessary for the operation of the
      Production Facility. FTCD shall pay the development costs incurred in the
      construction of the Off-Site Improvements, which shall include all charges
      related to the Off-Site Improvements. 

    
      
        
        

      

      
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    2.3.     Cost
      Limitation.
      If the
      costs of construction of the Production Facility, including HVAC, exceed fifty
      United States dollars ($50 U.S.D.) per square foot (“Upset
      Cost”),
      then
      NutraCea or FTCD may elect to proceed with the Alternate Production Arrangement
      and to terminate the Lease. Any such election to terminate the Lease and proceed
      with the Altermate Production Arrangement as a result of an Upset Cost shall
      be
      null and void; however, if FTCD or NUtraCea agrees to pay the Upset Cost.
      NutraCea shall have the right to elect to initially construct a building of
      smaller square footage in connection with redesigning the building in order
      to
      attempt to reduce the cost of construction below the Upset Cost, provided
      however, that such building shall be reasonably sufficient for the intended
      operations as set forth in this agreement the production requirements
      hereunder.

    

    2.4.     Operation,
      Maintenance and Repair.
      The
      Company will have responsibility for providing personnel to properly clean,
      operate and maintain the Equipment (if NutraCea elects to proceed with the
      construction of a Dominican Republic Production Facility) during the term of
      this Agreement; provided, however, that NutraCea will be responsible for
      promptly providing replacement parts normally used during normal operations
      for
      the Equipment. Any parts destroyed or rendered unusable by the Company’s
      personnel will be replaced at the expense of the Company.  The
      Company, with assistance from FTCD, will ensure that the maintenance, cleaning
      and operation of the Equipment complies with all applicable health, safety,
      labor, building and other codes and regulations and that the Equipment is kept
      in a sanitary and food grade quality condition. If either party elects to
      proceed with the Alternate Production Arrangement, the Company will be
      responsible to operate, maintain and repair the facilities necessary to convert
      the bulk Solubles mixture into Product Servings, including the addition of
      water
      and packaging of individual Servings. 

    

    2.5.     Approval
      and Consents.
      Unless
      otherwise specifically provided for herein, if any party is requested to give
      its approval or consent to any matter, it shall not unreasonably withhold such
      consent and it shall respond in writing within ten days after receipt of written
      request therefor from the other party, provided such request includes all
      information necessary to make a determination regarding such approval or
      consent. 

    

    2.6.     Alternate
      Production Arrangement.
      Notwithstanding any contrary provisions in the Section 2 or in any other
      provisions of this Agreement, either party has the right to require the
      production of the Solubles Mixture to occur in the United States and not to
      construct or to delay the construction of a Production Facility in the Dominican
      Republic. Both NutraCea and FTCD must agree to construct the Production Facility
      in the Dominican Republic. In such event NutraCea will create
      sufficient production facilities in the United States of America to fulfill
      its
      supply requirements to provide the
      bulk
      Product Solubles mixture to be added with water and packaged into the Product
      Servings by the Company, as necessary to
      satisfy its obligations under
      this Agreement, and all other terms and conditions under this Agreement will
      remain in effect for both parties (the “Alternate
      Production Arrangement”).
      Under
      the Alternate Production Arrangement, NutraCea will ship bulk Solubles mixture
      to the Company, and the Company will produce the individual Servings. FTCD
      will
      take all action necessary to comply with applicable law in the production of
      the
      Servings from the Solubles mixture. The Company will pay for all costs of
      shipping the Solubles mixture to the Dominican Republic. If either party elects
      this Alternate Production Arrangement, then the provisions of Sections 2.1
      through 2.4 that are only applicable for the Dominican Republic Production
      Facility shall not apply. NutraCea will complete the improvements and
      construction necessary for the Alternate Production Arrangement Production
      Facility within twenty-four months of the date of this Agreement. Any
      prevention, delay or stoppage due to strikes, lockouts, labor disputes, acts
      of
      God, inability to obtain labor or materials or reasonable substitutes therefore,
      governmental restrictions, governmental regulations, governmental controls,
      enemy or hostile governmental action, civil commotion, fire or reasonable
      casualty, and other causes beyond the reasonable control of NutraCea and shall
      exclude the performance by NutraCea for a period equal to any such prevention,
      delay or stoppage. 

    
      
        
        

      

      
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              3.

            	
              Company
                Formation and Purpose.

            

    

    

    3.1.     Company
      Formation and Purpose.
      By no
      later than 14 days following the Effective Date, NutraCea and FTCD agree to
      form
      the Company as one or more entities, owned equally by each of the parties.
      The
      type of entity or entities will be mutually determined by the parties in a
      manner reasonably anticipated to minimize the tax liabilities of the parties
      and
      to allow for effective business operations in the Dominican Republic and Haiti
      as contemplated hereunder. The Company will be owned initially by NutraCea
      and
      FTCD. The Company will have (a) as its registered name “Food for Life, LLC”, (b)
      as its purpose the distribution and marketing of the Products in the Dominican
      Republic and Haiti; (c) charter documents and one or more shareholder or
      operating agreements of form and content reasonably approved by the parties,
      in
      good faith, within 14 days after the Effective Date (“Charter
      Agreements”);
      and
      (d) the authority, in addition to such other authority granted in the Charter
      Agreements, to cause to be filed under the laws of any jurisdiction in which
      the
      Company intends to conduct its business any documents necessary for the Company
      to form any subsidiaries necessary in order to transact its business in such
      jurisdiction. The parties will share equally in the management and profits
      of
      the Company, except as to those items designated below. Any disbursement of
      funds or expenditures from the Company will require written approval of at
      least
      one authorized representative from each of NutraCea and FTCD. The Company may
      not operate or sell or distribute any Products outside of the Dominican Republic
      or Haiti without the express pior written approval of NutraCea. NutraCea shall
      appoint the chief financial officer of the Company, shall select the accountants
      to be retained by the Company, and shall control its accounting and reporting
      issues. The parties acknowledge that NutraCea is a public company under laws
      of
      the United States, and agree that the Company will take the appropriate actions
      necessary to comply with any United States reporting obligations of NutraCea.
      NutraCea shall have no obligation to contribute any NutraCea intellectual
      property to the Company and neither the Company nor FTCD will obtain any rights
      or interest in any intellectual property, trademarks, trade names, patents,
      or
      trade secrets of NutraCea as a result of the transactions contemplated in this
      Agreement unless expressly agreed to in advance and in writing by NutraCea.
      

    

    3.2.     Costs
      and Expenses.
      All
      costs and expenses (including without limitation legal, accounting fees and
      expenses), and all sales, use, transfer, excise, conveyance, business,
      occupation, franchise and other taxes, duties, assessments, charges and fees
      (other than taxes on or measured by the individual net income of a party)
      imposed on the Company or a party by a taxing authority related to the formation
      of the Company shall be borne by the Company, provided however, that each party
      shall bear all taxes on or measured by its net income and all legal fees and
      expenses incurred by it in connection with the preparation of this Agreement
      and
      related agreements.

    
      
        
        

      

      
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              [*]
                designates
                portions of this document that have been omitted pursuant to a
                request

              for
                confidential treatment filed seperately with the
                Commission

            

    

     

           
      3.3.     Principal
      Address.
      The
      Company’s principal offices and place of business shall be at such location as
      is designated by both parties, with the reasonable approval of FTCD. The
      principal place of business may be changed from time to time with the written
      consent of NutraCea and FTCD.

    

    
      	
              4.

            	
              Initial
                Contributions to the Company.
                

            

    

    

    4.1.     NutraCea
      Contributions.
      Unless
      either party elects to proceed with the Alternate Production Arrangement,
      NutraCea’s initial contribution to the Company shall be securing funding for the
      construction of the Production Facility, subject to the contributions of FTCD
      being met by the dates set forth herein and the construction and completion
      of
      the Production Facility as required herein. If either party elects to proceed
      with the Alternate Production Arrangement, NutraCea will agree to provide to
      the
      Company the Solubles mixture, including solubles, and Stabilized Rice Bran
      to be
      packaged by the Company into the Products, as required pursuant to Section
      6.
      The first distribution of funds from the Company will be to repay any equity
      contributions made by either party, para-parsu. Any advances made by either
      party to or on behalf the Company must be approved by both parties and will
      be
      repaid before any distributions of funds from the Company.

    

    4.2.     FTCD
      Contributions.
      FTCD’s
      initial contribution to the Company shall be:

    

    (a)     The
      Lease
      for the Land to construct the Production Facility, if applicable. 

    

    (b)     One
      or
      more signed purchase agreements for sales to governmental and/or private
      organizations within the Dominican Republic or Haiti for the purchase of the
      Products packaged by the Company for a period of at least one year after the
      Effective Date of this Agreement in the amounts specified in Section 4.2 (c).
      FTCD will secure the purchase agreements no later than November 30, 2005 and
      represents and warrants to NutraCea, as a material term to the Agreement, that
      FTCD is able to obtain such purchase agreements.

    

    (c)     during
      the initial two year period(years one and two) from the Effective Date, FTCD
      shall secure signed purchase agreements in the aggregate annual amount of at
      least [*]
      for
      Products Servings in the Dominican Republic, representing approximately 200,000
      Servings per day, based on a price of approximately [*]
      per
      serving, but in no case less than [*]
      per
      serving. All such dollar amounts will be determined based upon the currency
      exchange rate for Dominican Republic pesos into United States dollars in effect
      as of the Effective Date and will be subject to currency exchange fluctuations
      occurring thereafter. FTCD will secure the initial written purchase orders
      no
      later than 45 days from the Effective Date. Until and unless the Production
      Facility in the Dominican Republic is completed and operational, the bulk
      Solubles Product mixture requirements under this Agreement shall be met by
      NutraCea’s United States facilities (this will occur during the entire term that
      either party elects to proceed with the Alternate Production Arrangement) and
      package the bulk Solubles in accordance with the terms of this Agreement.

    
      
        
        

      

      
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                  [*]
                    designates
                    portions of this document that have been omitted pursuant to
                    a
                    request

                  for
                    confidential treatment filed seperately with the
                    Commission

                

        

         

      
(d)      during
      the next two year period (years three and four), the purchase agreements in
      the
      aggregate will increase to at least [*]
      per
      month for Product, representing at least 800,000 Servings per day for
      approximately seventeen days per month (based on a price of approximately
[*]
      per
      Serving, but in no event less than [*]
      per
      Serving). 

    

    4.4.     License
      Grant to Company.
      Upon
      the formation of the Company, NutraCea shall grant to the Company an exclusive
      license, solely in and as to the Dominican Republic and Haiti, to manufacture,
      if applicable, and/or package and distribute the Products. The Company shall
      have the right to sublicense certain of the rights granted hereunder to FTCD,
      as
      necessary to allow FTCD solely to assist the Company in the performance of
      its
      duties hereunder. The parties intend to create one or more private label brand
      names for the Products, which shall be owned by the Company. With the exception
      of these private label trade names all rights not specifically granted hereunder
      shall remain the property of NutraCea, and neither the Company nor FTCD shall
      have a license therein except as specifically granted herein. 

    
      

      
        	
                5.

              	
                Regulatory
                  Approvals.

              

      

       

    

    5.1.     Regulatory
      Compliance.
      FTCD
      shall obtain all appropriate governmental and legal permits and consents
      required for: (i) the importation by NutraCea of Solubles, and Stabilized Rice
      Bran and the processing of the Solubles and Stabilized Rice Bran into Products
      by the Company during the period prior to the completion of the Production
      Facility, or the entire term if NutraCea or FTCD elects to proceed with the
      Alternate Production Arrangement; (ii) the construction of the Production
      Facility, if applicable; (iii) the initiation and ongoing operation of the
      Production Facility, if applicable and (iv) all other activities contemplated
      by
      the business of the Company. FTCD is required to obtain government wavers of
      import duties, taxes and fees associated with any product or equipment imported
      to the Dominican Republic.

    

    5.2.     Assistance
      with Compliance.
      NutraCea shall provide FTCD with samples of the Products and Product
      descriptions required for the registration process. NutraCea shall provide
      FTCD
      with all reasonable assistance in obtaining the required permits and consents.
      

    
      

      
        	
                6.

              	
                Supply
                  of Materials.

              

      

       

    

    6.1.     Sale
      and Delivery of Materials.
      Unless
      NutraCea or FTCD elects to proceed with the Alternate Production Arrangement,
      subject to the terms and conditions hereof, FTCD hereby agrees to sell
      to
      the Company, and the Company shall have the option to purchase from FTCD,
      quantities of raw rice bran that FTCD is reasonably able to deliver and required
      to fill orders by the Company to FTCD for Product. FTCD shall establish a credit
      limit for the Company’s purchases comparable to the limit established by FTCD
      for customers of similar creditworthiness. The purchase price of all raw rice
      bran so purchased by the Company, at the Company’s option, shall be established
      by the parties, in advance, on an annualized basis, but in no event shall it
      exceed the market price per quantity and term ordered for such material in
      the
      Dominican Republic. This pricing shall apply to all orders processed by FTCD
      during each calendar year. The weight of raw bran sold to the Company will
      be
      computed based upon the actual weight of accepted finished bran. Prior to the
      completion of a Production Facility in the Dominican Republic, and during the
      entire term that either party elects to proceed with the Alternate Production
      Arrangement, and subject to the terms and conditions hereof, NutraCea hereby
      agrees to sell
      to
      the Company, and the Company agrees to purchase from NutraCea the Company’s
      requirements for Stabilized
      Rice Bran Isolates, including Solubles, and Stabilized Rice Bran to be processed
      into Products by the Company for resale as permitted herein and as required
      to fill orders for Product sales, which will only be permitted in the Dominican
      Republic and Haiti. The purchase price of all such materials purchased by the
      Company shall be the total cost to manufacture, assemble, and prepare such
      materials, including all direct and actual costs and overhead costs, with
      overhead costs not to exceed [*]
      of the
      raw ingredient costs.

    
      
        
        

      

      
        -
          8
          -

        
          

        

      

      
        
        

      

    

    
       

      
        	
                [*]
                  designates
                  portions of this document that have been omitted pursuant to a
                  request

                for
                  confidential treatment filed seperately with the
                  Commission

              

      

       

    

    (a)     Taxes.
      The
      prices for the materials shall include any excise, sales, use, value added
      or
      other taxes, tariffs or duties that may be applicable to the sale of the
      materials. 

    

    (b)     No
      Withholding.
      Except
      for the withholding of taxes required by the applicable laws of the Dominican
      Republic, all payments by the Company shall be made free and clear of, and
      without reduction for, any withholding taxes. Any such taxes which are otherwise
      imposed on payments to FTCD and/or NutraCea shall be the responsibility of
      FTCD
      and NutraCea, as applicable. The Company shall provide FTCD and NutraCea with
      official receipts issued by the appropriate taxing authority or such other
      evidence as is reasonably requested by FTCD or NutraCea, as applicable, to
      evidence all withheld taxes paid over to the government.

    

    (c)     Transportation.
      Transportation costs are the responsibility of the Company. All shipments will
      be freight collect unless other arrangements have been previously agreed upon.
      Responsibility for specifying the method of shipment rests with the Company
      at
      the time an order is placed. If the Company does not specify a method, FTCD
      or
      NutraCea, as applicable, will select an appropriate carrier, subject to the
      approval of NutraCea.

    

    7.     Operation
      of Business after Completion of Production Facility.
      Upon
      completion of the Production Facility, the Company shall retain a sufficient
      number of employees to operate the Production Facility, if applicable, pursuant
      to the license granted to the Company by NutraCea, and to mix, package,
      distribute and market the Products in the Dominican Republic and Haiti.

    

    8.     Conditions
      to Obligations of Parties.
      In
      addition to the following requirements, this Agreement is expressly conditioned
      on the prior approval of the Board of Directors of NutraCea, FTCD and The RiceX
      Company, as required pursuant to the pending combination of NutraCea and The
      RiceX Company. The following conditions must be satisfied or waived by NutraCea
      (in its sole discretion) as conditions to the obligations of NutraCea under
      this
      Agreement:

    
      

      
        	 	
                8.1.

              	
                Conditions
                  to the Obligations of NutraCea.  

              

      

       

    

    (a)     FTCD
      shall have obtained executed, binding Product purchase agreements as required
      pursuant to Section 4.2 (b) and (c) above; and

    

    (b)     FTCD
      shall have obtained all necessary or appropriate regulatory approval required
      pursuant to Section 5.1 above. 

    
      
        
        

      

      
        -
          9
          -

        
          

        

      

      
        
        

      

    

    9.      Competition.
      During
      the term of this Agreement, the parties agree that neither party may engage
      in
      other enterprises that compete with the business of the Company and/or compete
      with the current businesses conducted by each other, in the Dominican Republic
      or Haiti.

    
      

      
        	
                10.

              	
                Term;
                  Termination.
                  

              

      

       

    

    10.1.   Term.
      The
      term of this Agreement shall be ten years from the Effective Date (“Term”),
      unless earlier terminated pursuant to the terms of this Agreement. 

     

    10.2.      
      Termination.
       This
      Agreement may be terminated prior to expiration thereof without liability of
      the
      terminating party:

    

    (i)     By
      either
      Party, at any time after the failure of the other party to make any payment
      due
      under this Agreement within ten days after notice that such payment is due,
      subject, however, to the force majeure provisions of Section 19, if applicable;
      and 

    

    (ii)     By
      either
      party, at any time after the ninetieth day after written notice to the other
      party of the breach by the other party of any provision contained in this
      Agreement, specifying the nature and extent of the breach, if within such thirty
      day period the specified breach has not been cured to the reasonable
      satisfaction of the aggrieved party.

    

    
      	 	
              11.3.

            	
              Effect
                of Expiration or Termination.

            

    

    

    (a)     General. The expiration
      or termination of this Agreement shall discharge each party from the further
      performance of its respective obligations hereunder, but shall not release
      either party from liability arising before or as a result. 

    

    (b)     Confidential
      Information. In
      addition to the foregoing, upon expiration or termination of this Agreement
      for
      any reason, each party will return to the other, and/or will provide evidence
      satisfactory to the other party of the destruction of' all information or
      records provided to such party and all copies, extracts, summaries and abstracts
      thereof, and thereafter will not use or disclose any such information or records
      for its own benefit or to the detriment of the other party.

    

    (c)     Removal
      of Equipment. Upon
      termination or expiration of this Agreement, NutraCea may, at its own expense,
      promptly remove the Equipment from the FTCD Mill, if applicable, without causing
      any damage to the FTCD Mill. All designs, blueprints, and components relating
      to
      the Equipment remain the sole property of NutraCea.

    

    (d)     Survival
      of Covenants. The
      obligations of the parties under this Section 11 and Sections 12 and 13 shall
      survive any expiration or termination of the Agreement.

     

    
      	
              12.

            	
              Allocation
                of Liability; Indemnification; Insurance.

            

    

    

    12.1.   Allocation
      of Liability.
      NutraCea shall bear sole responsibility for the payment, defense of and
      resolution of all claims, demands or causes of action (“Claims”)
      brought by any third party relating to or arising during or as a result of
      the
      design, installation or removal of the Equipment, if the parties proceed with
      Dominican Republic Production Facility hereunder. FTCD shall bear sole
      responsibility for the payment, defense of and resolution of all Claims brought
      by any third party to the extent proximately resulting from the negligent
      operation, maintenance or repair of the Equipment by FTCD employees or
      contractors.

    
      
        
        

      

      
        -
          10
          -

        
          

        

      

      
        
        

      

    

    12.2.   Indemnification. Each
      party hereby agrees to indemnify, defend and hold the other party and the
      other's directors, officers, shareholders, members, employees and agents
      harmless from and against (i) any and all Claims for which the indemnifying
      party bears sole responsibility under Section 12.1, (ii) any breach by the
      indemnifying party of its warranties or obligations hereunder, or (ii) any
      and
      all Claims made by any customer of the indemnifying party, whether for breach
      of
      any sales transaction or otherwise (but excluding any Claims resulting from
      a
      breach by the other party of any matter covered by Section 12.1
      above).

    

    12.3.   Insurance. The
      parties will cause the Company to carry at all times during the term of this
      Agreement (i) general liability insurance sufficient in scope of coverage to
      cover its respective liabilities under this Section 13 in the amount of at
      least
      one million United States dollars ($1,000,000 U.S.D.) per claim and in the
      aggregate and (ii) product liability insurance covering the Product in the
      amount of at least one million United States dollars ($1,000,000 U.S.D.) per
      claim and in the aggregate, in each case naming the both NutraCea and FTCD
      as an
      additional insured, and from time to time upon request of the other party to
      furnish reasonable evidence of such coverage. If the Company fails to satisfy
      its obligations under this Section 13.3, either party may purchase and maintain
      such insurance on the Company’s behalf and may add any premiums so paid to the
      amounts otherwise payable by the Company to that party pursuant to this
      Agreement.

    

    
      	
              13.

            	
              Confidentiality.

            

    

    

    13.1.    General.
       Each
      party agrees that during the course of performance of this Agreement, such
      party
      may receive or learn information relating to the other party, including without
      limitation the customers, suppliers, capacities, processes, patents, products,
      procedures, know-how, costs, business plans, assets or business of the other
      party (and which also includes all information delivered by FTCD to NutraCea
      under Section 4.3), and that much of such information comprises trade secrets.
      Each party agrees to treat all such information as confidential, and (i) to
      use
      at least the same measures and procedures to protect such information from
      non-permitted use or disclosure as it uses to protect its own confidential
      information, and (ii) not to disclose such information to anyone other than
      those employees involved in the administration of this Agreement that have
      a
      need to know such information. Each party further agrees not to use any such
      information (or permit the use thereof by any of its employees) except as
      expressly permitted by this Agreement, whether for its own benefit or to the
      detriment of the other, and not to disclose or to permit the disclosure of
      any
      such information by any person or entity under its control or influence, except
      to the extent that any such disclosure is required by law or by legal process,
      and then only after giving the other party reasonable advance notice of and
      an
      opportunity to contest the proposed disclosure.

    
      
        
        

      

      
        -
          11
          -

        
          

        

      

      
        
        

      

    

    13.2.    FTCD
      Mill.
      All
      rules and regulations of FTCD regarding the FTCD Mill, including without
      limitation access to the FTCD Mill by anyone not employed by FTCD, visitors
      at
      the FTCD Mill or photographs taken at the FTCD Mill, as such rules and
      regulations may be amended from time to time during the term of this Agreement,
      are hereby fully incorporated by reference into this Agreement and the Company
      and NutraCea agree to comply with all such rules and regulations. FTCD, however,
      shall not unreasonably deny the Company and NutraCea personnel and their guests’
reasonable access to the facility. Access to FTCD facilities for NutraCea
      personnel and guests shall be limited solely to Bran Stabilization Facility
      and
      the nearest restrooms, unless previously approved and/or accompanied by FTCD
      management.

    

    13.3.   Specific
      Enforcement.
      The
      parties agree that any breach of the provisions of this Section 13 may result
      in
      damage to the aggrieved party which is irreparable, speculative or otherwise
      difficult to prove, and that each party accordingly shall be entitled to
      injunctive relief in the event of any breach or threatened breach hereof by
      the
      other.

    
      

      
        	
                14.

              	
                General
                  Provisions.

              

      

       

    

    14.1.   Governing
      Law.
      The
      validity, interpretation, performance and enforcement of this Agreement shall
      be
      governed by the laws of the Dominican Republic.

    

    14.2.    Amendment.
      This
      Agreement may be amended at any time and from time to time, but any amendment
      must be in writing and signed by NutraCea and FTCD.

    

    14.3.     Notices.
      Any
      written notice to any party under this Agreement shall be deemed to have been
      duly given on the date of service if served personally on the party to whom
      notice is to be given, or on the seventh day after mailing if mailed to the
      party to whom notice is to be given, first class postage prepaid, return receipt
      requested, and addressed to the addressee at the address stated opposite his
      or
      its name below, or at the most recent address specified by written notice given
      to the sender by the addressee under this provision so long as at the time
      of
      mailing, the correspondence is also faxed to the recipient at the fax number
      also listed below:

    

    
      	 	
              NutraCea

            	
              Food
                Trading Company Dominicana, S.A.

            

    

    
      	 	
              1261
                Hawk’s Flight Court

            	
              Calle
                Manuel de Jesus Troncoso No. 18

            

    

    
      	 	
              El
                Dorado Hills, CA 95762

            	
              Ensanche
                Paraiso

            

    

    
      	 	
              United
                States

            	
              Santo
                Domingo, Dominican Republic

            

    

    
      	 	
              Fax:
                (916) 933-7001

            	
              Attention:
                Juan Jose Agramonte

            

    

    Attention:
      Bradley Edson

    

    14.4.   Entire
      Agreement.
      This
      Agreement, including referenced exhibits and attachments, contains the entire
      agreement of the parties relating to the rights granted and obligations assumed
      in this Agreement. Any oral representations or modifications concerning this
      instrument shall be of no force or effect unless contained in a subsequent
      written modification entered into in accordance with the terms of this
      Agreement.

    

    14.5.   Benefit;
      Assignment.
      This
      Agreement shall be binding upon the parties and their respective successors
      and
      assigns and shall inure to the benefit of the parties and their respective
      successors and permitted assigns. No party may assign nay of its rights or
      delegate any of its duties under this Agreement without the prior written
      consent of the other party and any assignment or delegation of this Agreement
      by
      either party without the prior written consent of the other party shall be
      void.
      In no event shall either party assign any of its rights or delegate any of
      its
      duties under this Agreement to any person other than a transferee of its
      interests pursuant to the Operating Agreement. 

    
      
        
        

      

      
        -
          12
          -

        
          

        

      

      
        
        

      

    

    14.6.    No
      Third Party Beneficiaries.
      This
      provisions of this Agreement are intended to bind each party to the other party
      and, except for the Company, are not intended to create and do not create any
      rights in any other person, including without limitation , any employee of
      the
      Company. No person or entity, other than the Company, shall be deemed to be
      a
      third party beneficiary of this Agreement. 

    

    14.7.    Severability.
      If a
      court of competent jurisdiction determines that any provision of this Agreement
      is invalid, unenforceable or illegal for any reason, such determination shall
      not affect or impair the validity, legality and enforceability of the other
      provisions of this Agreement which shall remain in full force and effect in
      the
      same manner and to the same extent as if the invalid, unenforceable or illegal
      provision had not been contained in this Agreement. 

    

    14.8.    Headings.
      The
      headings set forth in this Agreement have been inserted for convenience of
      reference only, shall not be considered a part of this Agreement and shall
      not
      limit, modify or affect in any way the meaning or interpretation of this
      Agreement. 

    

    14.9.    Waiver.
      No
      waiver of any provision of this Agreement shall be binding upon a party unless
      such waiver is expressly set forth in a written instrument which is executed
      and
      delivered on behalf of such party by an authorized representative of such party.
      Such waiver shall be effective only to the extent specifically set froth in
      such
      written instrument. Neither the exercise (from time to time and at any time)
      by
      a party of, noir the delay or failure (at any time or for any period of time)
      to
      exercise, any right, power or remedy shall constitute a waiver of the right
      to
      exercise, or impair, limit or restrict the exercise of, such right, power or
      remedy or any other right, power or remedy at any time and from time to time
      thereafter. No waiver of any right, power or remedy of a party shall be deemed
      to be a waiver of any other right, power or remedy of such party or shall,
      except to the extent so waived, impair, limit or restrict the exercise of such
      right, power or remedy. 

    

    14.10.   Counterparts.
      This
      Agreement may be signed in any number of counterparts, each of which (when
      executed and delivered) shall constitute an original instrument, but all of
      which together shall constitute one and the same instrument. 

    

    14.11.   Language.
      This
      Agreement shall be written and construed in the English language. 

    

    
      	
              15.

            	
              Disputes;
                Arbitration; Waiver of Bond.

            

    

    

    15.1.     Arbitration.
      Any and
      all claims, disputes or controversies arising under, out of, or in connection
      with this Agreement or with operation of the Company, which have not been
      resolved by good faith negotiations between NutraCea and FTCD, shall be resolved
      by timely final and binding arbitration under the Rules of Arbitration of the
      International Chamber of Commerce. Any arbitration proceedings initiated by
      FTCD
      shall be held and take place in Sacramento, California. Any arbitration
      proceedings initiated by NutraCea shall be held and take place in Santo Domingo,
      Dominican Republic.

    
      
        
        

      

      
        -
          13
          -

        
          

        

      

      
        
        

      

    

    15.2.    Arbitrators.
      The
      arbitrators shall include one nominee to be selected by NutraCea and one
      selected by FTCD, and a third nominee to be jointly selected by the two
      nominees. In the event the respective nominees are unable to jointly select
      such
      third nominee within thirty days after they each make their own nomination,
      then
      the parties shall request the International Chamber of Commerce to designate
      the
      third arbitrator.

    

    15.3     Judicatum
      Solvi Bond.
      In the
      event that there should arise any dispute between the parties regarding the
      terms of the present Agreement and other Agreements related to the present
      transaction, FTCD
      formally
      and expressly waives requesting
      NutraCea
      or any
      assignee of the latter, from the requirement of providing a bond as a transient
      foreign plaintiff, as established by Article 16 of the Civil Code and articles
      166 and 167 of the Code of Civil Procedure, both of the Dominican
      Republic.

    

    16.     No
      Joint Venture or Partnership; No Reference to Agreement or
      Relationship.
      Nothing
      in this Agreement shall be construed to create a partnership or joint venture
      of
      any kind or for any purpose between the parties hereto, or to constitute either
      party a special or general agent of the other, and neither party will act or
      represent otherwise to any third party. Neither party shall refer to this
      Agreement, to the other party or the relationship between the parties in any
      communication with any third party without the prior written consent of the
      other party.

    

    17.     Disclaimer
      of Warranties.
      NOTWITHSTANDING
      ANYTHING CONTAINED IN THIS AGREEMENT, NEITHER PARTY MAKES ANY REPRESENTATIONS
      OR
      WARRANTIES OF ANY KIND TO THE OTHER, WHETHER EXPRESS OR IMPLIED (INCLUDING
      WITHOUT LIMITATION ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS OF
      PRODUCTS FOR A PARTICULAR PURPOSE), WITH RESPECT TO ANY RAW RICE BRAN OR
      PRODUCTS SOLD UNDER THIS AGREEMENT,
      except
      as expressly provided herein and that all raw rice bran will be pre-cleaned
      and
      freshly milled and sold in accordance with applicable law. The terms of any
      purchase order used or submitted in purchasing raw rice bran or the Products
      shall, except for the amount thereof purchased, be inapplicable and the
      provisions of this Agreement shall govern all such transactions.

    

    18.     Limitation
      of Liability.
      Not
      withstanding anything contained in Section 12 or elsewhere in this Agreement,
      neither party shall be liable to the other, whether in tort, in contract or
      otherwise, and whether directly or by way of indemnification, contribution
      or
      otherwise, for any incidental, consequential, punitive or exemplary damages,
      (including without limitation lost profits or revenues or injury to business
      or
      business reputation), whether of the other party or of any third party, relating
      to or arising out of Products delivered under this Agreement or the sale of
      any
      Products.

    

    19.     Force
      Majeure.
      Neither
      party shall be responsible for any delays in processing of any Product ordered
      on account of strikes, blackouts, floods, droughts, riots, epidemics, fire,
      governmental regulation, acts of God or other causes beyond its
      control.

    

    20.    Severability.
      In case
      any provision of this Agreement shall be declared invalid, illegal or
      unenforceable in any jurisdiction, such provision shall be deemed stricken
      from
      this Agreement as to that jurisdiction only, and the validity, legality and
      enforceability of this Agreement or of any of its provisions in such
      jurisdiction or in any other jurisdiction shall not otherwise be
      affected

    
      
        
        

      

      
        -
          14
          -

        
          

        

      

      
        
        

      

    

    

    
      	
              NUTRACEA

            	 	
              FOOD
                TRADING COMPANY DOMINICANA, S.A.

            	 
	 	 	 	 
	 	 	 	 
	
              /s/
                Bradley D. Edson

            	 	
              /s/
                Juan Jose Agramonte Rincon

            	 
	
              By:
                Bradley D. Edson

            	 	
              By:
                Juan Jose Agramonte Rincon

            	 
	
              Title:President

            	 	
              Title:
                Chief Executive Officer

            	 
	 	 	 	 

    

    
      
        
        

      

      
        -
          15
          -

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
      A

    Specifications

    

    

    

    [No
      specifications attached.]

     -16
      -Unassociated Document

    
      

    

     

    
      	
              [*]
                designates
                portions of this document that have been omitted pursuant to a
                request

              for
                confidential treatment filed seperately with the
                Commission

            

    

    ASSIGNMENT
      OF INTERESTS

    
      Exhibit
        10.19

       

    

    This
      Assignment of Interests (“Assignment”)
      is
      entered into by and between NutraCea, a California corporation with principal
      offices at 1261 Hawk’s Flight Court, El Dorado Hills, CA 95762 (“NutraCea”),
      NutraGlo Incorporated, a Nevada corporation with principal address at
      _________________ (“NutraGlo”),
      NaturalGlo Specialty Products, LLC, a Delaware limited liability company with
      principal address at 2711 Centerville Road, Suite 400, Wilmington, DE 19808
      (“LLC”)
      and
      W.F. Young, Inc., a Massachusetts corporation with principal address at 302
      Benton Drive, East Longmeadow, MA 01028-5990 (“W.F.
      Young”).
      The
      parties agree as of April 12, 2005 (“Effective
      Date”)
      as
      follows:

    

    

    1.     Background
      and Purpose.
      Pursuant to a “Distribution
      Agreement”
entered
      into on May 1, 2001 by and between NutraCea, W.F. Young and Wolcott Farms,
      Inc.(“Wolcott”)
      and
      subsequently modified pursuant to the Technology Agreement, as defined below,
      W.F. Young obtained exclusive worldwide marketing rights to Flex+ and Flx+
      products for the equine markets on such terms as defined in the Distribution
      Agreement (“Equine
      Flex+”).
      W.F.
      Young formed the LLC with the intent that it later would be jointly owned by
      W.F. Young and Wolcott. However, a limited liability company agreement between
      W.F. Young and Wolcott was neither entered nor adopted for the LLC. W.F. Young’s
      capital contribution to the LLC is in the amount of [*].
      W.F.
      Young wishes to transfer to NutraGlo all rights obtained by W.F. Young pursuant
      to Sections 3.1 and 3.2 of the Technology Agreement entered into by and between
      NutraCea, W.F. Young and Wolcott dated September 18, 2003 (“Technology
      Agreement”).
      To
      the fullest extent permissible by law, the LLC wishes to transfer to NutraGlo
      its right, title and interest to certain patent/technology rights that (i)
      are
      currently held by the LLC, and/or (ii) may be obtained by the LLC pursuant
      to
      the Technology Agreement upon the occurrence of a specified merger transaction
      and upon the patent issuance. 

    

    2.     Transfer
      of Technology Agreement Rights.
      To the
      fullest extent permitted by applicable law, W.F. Young hereby transfers to
      NutraCea all rights, powers and authority granted to or obtained by W.F. Young
      pursuant to Sections 3.1 and 3.2 of the Technology Agreement. 

    

    
      	
              3.

            	
              Transfer
                of Technology Rights Held by LLC; Indemnification.
                

            

    

    

    3.1     Transfer
      of Technology.
      To the
      fullest extent permissible, the LLC shall transfer to NutraGlo all of its right,
      title and interest in any and all rights, including without limitation, future
      or contingent rights to technology specified in the Technology Agreement
      obtained or that may be obtained by the LLC pursuant to Sections 2.3, 3.1 and
      3.2 and any other provision of the Technology Agreement (“Technology”).
      

    

    
      
        
          
          

        

        
          1

          
            

          

        

        
          
          

        

      

    

    
       

      
        	
                [*]
                  designates
                  portions of this document that have been omitted pursuant to a
                  request

                for
                  confidential treatment filed seperately with the
                  Commission

              

      

       

    

    3.2     Failure
      to Transfer Technology; Indemnification.
      In the
      event that the LLC is unable to complete the transfer of the Technology, W.F.
      Young agrees to use its best efforts to resolve the matter as soon as reasonably
      practical and will not take any actions inconsistent with the requests or wishes
      of NutraGlo with respect to such Technology. In reliance on the representations
      and warranties by W.F. Young contained herein, NutraGlo agrees to indemnify
      and
      hold W.F. Young and its respective officers, directors, employees, affiliates,
      shareholders and agents, and each of their respective heirs, personal
      representatives, successors and assigns ("Indemnified
      Parties"),
      harmless from, against and in respect of any and all losses, costs, expenses
      (including without limitation, reasonable attorneys' fees and disbursements
      of
      counsel), liabilities, damages (excluding incidental, consequential or punitive
      damages), fines, penalties, charges, assessments, judgments, settlements,
      claims, causes of action and other obligations of any nature whatsoever
      (individually, a "Loss"
      and
      collectively, "Losses")
      that
      any of them may at any time, directly or indirectly, suffer, sustain, incur
      or
      become subject to, to the extent arising out of, based upon or resulting from
      or
      on account of W.F. Young’s compliance with Section 3.1. Notwithstanding the
      foregoing, any Loss or aggregate Losses to be indemnified shall not exceed
      [*]
      (“Maximum
      NutraGlo Indemnity”).
      In
      the event that the Maximum NutraGlo Indemnity is exceeded, NutraGlo and W.F.
      Young shall equally share all costs that exceed the Maximum NutraGlo Indemnity
      and NutraGlo and W.F. Young shall each be entitled to exercise joint and equal
      control over the defense, settlement and expenditure of costs for any such
      matter for which indemnity under this section is required. In the event the
      parties are unable to agree on how to proceed in any claim or proceeding, the
      dispute shall be settled by arbitration conducted by one (1) arbitrator pursuant
      to the rules of the American Arbitration Association. 

     

    3.3     Decline
      to Exercise Option.
      Without
      in any manner limiting any other provision herein, W.F. Young agrees not to
      exercise the options set forth in Sections 3.1 and/or 3.2 of the Technology
      Agreement with respect to the Technology and, to the fullest extent permissible
      by law, waives any rights to exercise such options. 

    

    
      	
              4.

            	
              Payments.
                

            

    

    

    4.1     Payments
      to W.F. Young.
      In
      consideration for the transfer of rights set forth in Section 2, NutraCea shall
      issue to W.F. Young and W.F. Young shall receive the number of shares of
      NutraCea restricted common stock determined by [*]
      (“W.F.
      Young Consideration Shares”).
      NutraCea shall deliver the W.F. Young Consideration Shares to W.F. Young within
      fourteen (14) days of the Effective Date. 

    

    4.2     Payment
      to LLC.
      In
      consideration for the transfer of rights set forth in Section 3, NutraGlo shall
      cause NutraCea to issue to the LLC and the LLC shall receive the number of
      shares of NutraCea restricted common stock determined by [*]
      (“LLC
      Consideration Shares”).
      NutraCea shall deliver the LLC Consideration Shares to the LLC within fourteen
      (14) business days of the Effective Date. 

    

    
      	
              5.

            	
              Representations
                and Warranties.
                

            

    

    

    5.1     Representations
      and Warranties of W.F. Young.
      W.F.
      Young represents and warrants to NutraCea as follows:

    

    (a)     Organization
      and Standing.
      It is a
      corporation duly organized, validly existing and in good standing under the
      laws
      of the Commonwealth of Massachusetts;

    

    (b)     Power
      and Authority.
      It has
      the power and authority to execute, deliver and perform this Assignment and
      any
      agreement executed in connection herewith;

    

    
      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

    

    

    (c)     Binding
      Agreement.
      This
      Assignment has been duly executed and delivered by W.F. Young and is the legal,
      valid and binding obligation of W.F. Young, enforceable against W.F. Young
      in
      accordance with its terms, except as enforcement may be limited by bankruptcy,
      insolvency, moratorium, reorganization, or other similar laws relating to or
      affecting the enforcement of creditor’s rights generally, and except of the
      availability of specific performance, injunctive relief or other equitable
      remedies as subject to the discretion of the court before which any such
      proceeding therefore may be brought; and

    

    (d)     LLC.
      Win
      Wolcott, Wolcott Farms and NaturalGlo Specialty Products, a Delaware limited
      liability company have relinquished any and all right, title and interest,
      including any ownership interest, which they might have, or have had, as a
      member of the LLC, and any claims related thereto. 

    

    5.2     Representations
      and Warranties of NutraCea.
      NutraCea represents and warrants to W.F. Young as follows:

    

    (a)     Organization
      and Standing.
      NutraCea is a corporation duly organized, validly existing and in good standing
      under the laws of the State of California. It has the power and authority to
      own
      and lease the properties now owned or leased by it and to conduct its
      business;

    

    (b)     Power
      and Authority.
      It has
      the power and authority to execute, deliver and perform this Assignment and
      any
      agreement executed in connection herewith; and 

    

    (c)     Binding
      Agreement.
      This
      Assignment has been duly executed and delivered by NutraCea and is the legal,
      valid and binding obligation of it and enforceable against it in accordance
      with
      its terms, except as enforcement may be limited by bankruptcy, insolvency,
      moratorium, reorganization or other similar laws relating to or affecting the
      enforcement of creditor’s rights generally and except of the availability of
      specific performance, injunctive relived or other equitable remedies as subject
      to the discretion of the court before which any such proceeding therefore may
      be
      brought. 

    

    
      	
              6.

            	
              Miscellaneous
                Provisions.

            

    

    

    6.1     Governing
      Law.
      This
      Assignment shall be governed by the laws of the State of New York,
      notwithstanding its conflict of law principles. The parties agree that any
      dispute hereunder shall be settled by arbitration in New York, New York,
      pursuant to the rules of the American Arbitration Association. Any arbitration
      ruling issued pursuant to this section may be enforced in any court of competent
      jurisdiction.

    

    6.2     Entire
      Agreement.
      This
      Assignment, along with any and all documents expressly referred to and
      incorporated herein constitutes the entire agreement between the parties
      regarding the assignment of the rights from W.F. Young and the LLC to NutraCea
      and NutraGlo as set forth herein, all oral agreements regarding such assignment
      being merged herein, and supersedes all prior representations made by any of
      the
      parties hereto with regard to such assignment. There are no representations,
      agreements, arrangements, or understandings, oral or written, between or among
      the parties relating to the subject matter of this Assignment that are not
      fully
      expressed in this Assignment or the other agreements referenced herein.

    

    
      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

    

    

    6.3     Modification.
      The
      provisions of this Assignment may not be modified at any time unless agreed
      to
      in writing by all parties.

    

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

    

    6.5     Assignment.
      This
      Assignment shall not be assigned by any party without the prior written consent
      of the other parties. Any assignment contrary to the provisions of this
      Assignment shall be deemed a default under this Assignment, allowing the
      nondefaulting parties to exercise all remedies available under law.

    

    6.6     Successors.
      Subject
      to the provisions otherwise contained in this Assignment, this Assignment shall
      inure to the benefit of and be binding on the successors and assigns of the
      respective parties.

    

    6.7    No
      Third Party Beneficiaries.
      Nothing
      in this Assignment, whether express or implied, is intended to confer any rights
      or remedies under or by reason of this Assignment on any persons other than
      the
      parties to it and their respective successors and assigns, nor is anything
      in
      this Assignment intended to relieve or discharge the obligation or liability
      of
      any third persons to any party to this Assignment, nor shall any provision
      give
      any third persons any right of subrogation or action against any party to this
      Assignment.

    

    6.8     Notices.
      Any
      notice under this Assignment shall be in writing, and any written notice or
      other document shall be deemed to have been duly given (a) on the date of
      personal service on the other party, (b) on the third business day after
      mailing, if the document is mailed by registered or certified mail, or
      (c) one day after being sent by professional or overnight courier or
      messenger service guaranteeing one-day delivery, with receipt confirmed by
      the
      courier. Any such notice shall be delivered or addressed to the other party
      at
      the addresses set forth above or at the most recent address specified by the
      addressee through written notice under this provision. Failure to give notice
      in
      accordance with any of the foregoing methods shall not defeat the effectiveness
      of notice actually received by the addressee.

    

    6.9     Attorneys’
      Fees.
      If the
      services of an attorney are required by any party to secure the performance
      of
      this Assignment or otherwise upon the breach or default of one or more parties
      to this Assignment, or if any judicial remedy or arbitration is necessary to
      enforce or interpret any provision of this Assignment 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.

    

    
      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

    

    

    6.10     Counterparts.
      This
      Assignment 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.

    

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

    

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

    

     

     

    [SIGNATURE
      PAGE TO FOLLOW]

     

    
      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

    

    

    IN
      WITNESS WHEREOF, the parties have executed this Assignment as of the Effective
      Date.

     

     

    
      	
              NUTRACEA

            	 	
              W.F.
                YOUNG, INC.

            	 
	
              a
                California corporation

            	 	
              a
                Massachusetts corporation

            	 
	 	 	 	 
	 	 	 	 
	
              /s/
                Bradley D. Edson

            	 	
              /s/
                Adam D. Raczkowski

            	 
	
              By:
                Bradley D. Edson

            	 	
              By:
                Adam D. Raczkowski

            	 
	
              Title:
                President

            	 	
              Title:
                Executive VP and COO

            	 
	 	 	 	 
	 	 	 	 
	
              NUTRAGLO
                INCORPORATED

            	 	
              NATURALGLO
                SPECIALTY PRODUCTS

            	 
	
              a
                Nevada corporation

            	 	
              a
                Delaware limited liability company

            	 
	 	 	 	 
	 	 	 	 
	
              /s/
                Bradley D. Edson

            	 	
              /s/
                Adam D. Raczkowski

            	 
	
              By:
                Bradley D. Edson

            	 	
              By:
                Adam D. Raczkowski

            	 
	
              Title:
                Authorized Agent

            	 	
              Title:
                Authorized Agent/Treasurer

            	 

    

    

 

    

    

    [SIGNATURE
      PAGE TO ASSIGNMENT OF INTEREST]

    6

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