EXCLUSIVE SUPPLY AND COOPERATION AGREEMENT

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ESCROW AGREEMENT

This ESCROW AGREEMENT, dated as of February __, 2016 (together with Schedule A hereto, this “Agreement”), is by and among RICEBRAN TECHNOLOGIES, a California corporation, with principal offices located at ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ #▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (“Depositor”); ▇▇▇▇▇▇ ▇▇▇▇▇▇, an individual mailing address 1000/30 ▇.▇. ▇▇▇▇▇, ▇^▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ – Nua, Wattana, Bangkok (“▇▇▇▇▇▇”) and YOUJI COMPANY LIMITED, a Hong Kong limited company, a ▇▇▇▇ ▇▇, ▇/▇, ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇ (together with ▇▇▇▇▇▇, “Recipient”); and AMERICAN STOCK TRANSFER & TRUST COMPANY, LLC, a New York limited liability trust company, with principal offices located at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇▇▇ (“Escrow Agent”).

WHEREAS, Depositor and Recipient have entered into an Exclusive Supply and Cooperation Agreement (the “Underlying Agreement”), dated as of February 8, 2016, pursuant to which Depositor will pay Recipient a portion of the ▇▇▇ Margin (as defined in the Underlying Agreement) in the form of common stock of Depositor at a value as set forth in the Underlying Agreement. The Underlying Agreement provides that Depositor shall issue and deposit the Escrowed Shares (defined below) into escrow with Escrow Agent for the benefit of Depositor and Recipient to be held by Escrow Agent;

WHEREAS, Escrow Agent has agreed to accept, hold, and disburse the Escrowed Shares in accordance with the terms of this Agreement;

WHEREAS, Depositor and Recipient hereby appoint the Representatives (as defined below) to represent them for all purposes in connection with this Agreement (including the Escrowed Shares); and

WHEREAS, in order to establish the Escrowed Shares and otherwise to effect the provisions of the Underlying Agreement, the parties hereto have entered into this Agreement.

NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto, for themselves, their successors and assigns, hereby agree as follows:

1.

Definitions. The following terms shall have the meanings indicated or referred to below, inclusive of their singular and plural forms, except where the context requires otherwise. Unless the context requires otherwise, all references to “years,” “months,” or “days” shall mean “calendar years,” “calendar months,” and “calendar days.” References in this Agreement to “including” shall mean “including, without limitation,” whether or not so specified. Any term not defined below which is initially capitalized in this Agreement shall have the meaning ascribed to it in this Agreement.

 

“Affiliate” means, with respect to any person, (a) a person which directly or indirectly through one or more intermediaries controls, is controlled by or is under common control with such person, (b) any person of which such person is the beneficial owner of a twenty-five percent (25%) or greater interest, or (c) any person which acquires all or substantially all of the assets of such person. A person is deemed to control another person if such person, directly or indirectly, has the power to direct the management, operations or business of such person. The term “beneficial owner” is to be determined in accordance with Rule 13d-3 of the Securities Exchange Act of 1934, as amended.

“Business Day” shall mean any day other than a Saturday, a Sunday, or a day on which banking institutions in the State of New York are authorized or obligated by law or executive order to close.

“Depositor Representative” shall mean either of the persons so designated on Schedule A hereto or any other persons designated in a writing signed by Depositor and delivered to Escrow Agent and Recipient Representative in accordance with the notice provisions of this Agreement, to act as Depositor’s representative under this Agreement.

“Escrow Period” shall mean the period commencing on the date hereof and ending on the applicable termination date set forth on Schedule A hereto.

“Escrow Property” shall mean the Escrow Shares and any dividends on the Escrow Shares.

“Joint Written Direction” shall mean a written direction executed by the Representatives (as defined below) and directing Escrow Agent to disburse all or a portion of the Escrowed Shares or to take or refrain from taking an action pursuant to this Agreement.

“Recipient Representative” shall mean the persons so designated on Schedule A hereto or any other person designated in a writing signed by Recipient and delivered to Escrow Agent and Depositor Representative in accordance with the notice provisions of this Agreement, to act as Recipient’s representative under this Agreement.

“Representatives” shall mean Depositor Representative and Recipient Representative.

2.

Appointment of and Acceptance by Escrow Agent. Depositor and Recipient hereby appoint Escrow Agent to serve as escrow agent hereunder. Escrow Agent hereby accepts such appointment and, upon receipt of the Escrowed Shares in accordance with Section 3 below, agrees to hold and disburse Escrowed Shares in accordance with this Agreement.

 

3.

Issuance and Deposit of Escrowed Shares. Simultaneously with the execution and delivery of this Agreement, Depositor will, pursuant to the terms of the Underlying Agreement, issue 950,000 shares of common stock partially paid to be held by Escrow Agent in book-entry format, being held in the name of Transfer Agent, but whose books shall reflect the recipient (the “Escrowed Shares”), and which shall bear the following legends:

 

“THE SHARES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY APPLICABLE STATE SECURITIES LAWS AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD, EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN COMPLIANCE WITH APPLICABLE STATE SECURITIES LAWS OR BLUE SKY LAWS.”

 

“THE SHARES REPRESENTED HEREBY ARE PARTLY PAID AND ARE SUBJECT TO (i) RESTRICTIONS ON TRANSFER AND (ii) CALL AND REDEMPTION BY RICEBRAN TECHNOLOGIES IN THE EVENT THE SHARES DO NOT BECOME FULLY PAID PURSUANT TO RICEBRAN TECHNOLOGIES’ EXCLUSIVE SUPPLY AND COOPERATION AGREEMENT DATED FEBRUARY 8, 2016, AVAILABLE FOR INSPECTION AT ▇▇▇.▇▇▇.▇▇▇ AND AT RICEBRAN TECHNOLOGIES’ PRINCIPAL OFFICE, AND SECTION 409(D) OF THE CALIFORNIA CORPORATIONS CODE. THE TOTAL AMOUNT OF CONSIDERATION FOR THE SHARES SHALL BE $2.80 PER SHARE, OF WHICH $0.000001 HAS BEEN PAID.”

 

“THE SHARES REPRESENTED HEREBY ARE SUBJECT TO A VOTING AGREEMENT (A COPY OF WHICH MAY BE OBTAINED FROM THE ISSUER) AND BY ACCEPTING ANY INTEREST IN SUCH SHARES THE PERSON HOLDING SUCH INTEREST SHALL BE DEEMED TO AGREE TO AND SHALL BECOME BOUND BY ALL THE PROVISIONS OF SAID VOTING AGREEMENT. A COPY OF SUCH VOTING AGREEMENT WILL BE FURNISHED TO THE RECORD HOLDER WITHOUT CHARGE UPON WRITTEN REQUEST TO THE COMPANY AT ITS PRINCIPAL PLACE OF BUSINESS.”

 

4.	Maintenance of Escrowed Shares.

 

(a)

The Escrow Agent is authorized and directed to hold the Escrowed Shares. The Escrow Agent is not authorized to sell any Escrowed Shares at any time during the term of this Agreement. Subject to California Corporations Code Section 409(d), any dividends paid by Company on the Escrowed Shares shall become part of the Escrow Property and disbursed in accordance with Section 5 of this Escrow Agreement.

 

(b)

No party shall have any responsibility or liability for any decline in the value of the Escrow Property which may result from any decrease in the value of the Escrowed Shares that occurs from and after the date of issuance. The parties agree that the risk of fluctuations in the value of the Escrowed Shares is a risk that each party of the parties understands and has agreed to assume, and as to which no party has any liability or responsibility. The Escrow Agent may distribute the Escrowed Shares only in accordance with Section 5 below. The parties acknowledge that the Escrow Agent is not providing investment supervision, recommendation or advice of any kind in connection with this escrow.

 

5.	Release of Escrow Property.

 

(a)

Escrow Agent shall disburse Escrow Property from time to time, upon receipt of, and in accordance with, a Joint Written Direction. Such Joint Written Direction shall set forth the number the shares to be released (“Released Shares”). Upon receipt of a Joint Written Direction, Escrow Agent shall instruct American Stock and Transfer & Trust Company, LLC, as Depositor’s transfer agent (in such capacity, “Transfer Agent”) to updated the book entry for the Released Shares to remove the second and third of the three legends listed in Section 3. The book entry for the remaining Escrowed Shares shall continue to reflect the legends set forth in Section 3 and remain part of the Escrow Property. Such Released Shares and any dividends thereon shall then be released from the Escrow Property and delivered to Recipient, as set forth on Schedule A. Any and all releases under this Section 5 shall be made within five (5) Business Days of Escrow Agent’s receipt of a Joint Written Direction.

 

(b)

If there is any amount of undisbursed or unclaimed Escrow Property on the Termination Date (as defined in Schedule A hereto) (the “Unpaid Escrowed Shares”), and if Escrow Agent shall not have received a Joint Written Direction no later than five (5) days after the Termination Date (as defined in Schedule A hereto), Depositor shall be automatically deemed to exercise a call in to redeem the Unpaid Escrowed Shares at $0.000001 per share, pursuant to which Escrow Agent shall deliver the Unpaid Escrowed Shares to Transfer Agent, who shall cancel such Unpaid Escrowed Shares and deliver the funds for such Unpaid Escrowed Shares to Recipient by check mailed to the address set forth on Schedule A.

 

6.	Investment of Cash Funds. Escrow Agent is herein directed and instructed to invest and reinvest any cash received in respect of the Escrowed Property in one or more of the following:

 

(a)

direct obligations of the United States of America or obligations the principal of and the interest on which are unconditionally guaranteed by the United States of America;

 

(b)

certificates of deposit issued by any Federal Deposit Insurance Corporation-insured bank, bank and trust company, or national banking association (subject to applicable limits);

 

(c)

repurchase agreements or direct deposits with any bank, trust company, primary broker-dealer or national banking association; or

 

(d)

any institutional money market fund.

 

With the execution of this document, the parties hereto acknowledge receipt of prospectuses and/or disclosure materials associated with the investment vehicle (if applicable), either through means of hardcopy or via access to the website associated with the investment(s) selected by the parties to this Agreement. The parties hereto acknowledge that they have discussed the investment(s) and are in agreement as to the selected investment(s). The parties hereto acknowledge and agree that Escrow Agent will not provide supervision, recommendations or advice relating to either the investment of such moneys or the purchase, sale, retention or other disposition of any investment(s) described herein. Depositor and Recipient may provide instructions changing the investment(s) of such moneys (subject to applicable minimum investment requirements) by the furnishing of a Joint Written Direction to Escrow Agent.

 

Each of the foregoing investments shall be made in the name of Escrow Agent for the benefit of Depositor and Recipient. Any investment permitted above may be made with or in one or more of its Affiliates or in any fund or other investment vehicle managed by Escrow Agent or an Affiliate thereof and may be effected through the facilities of Escrow Agent’s or its Affiliate’s trading or capital market operations. The parties hereto acknowledge and agree that, in connection with such moneys’ investment in mutual funds or other investments, Escrow Agent (or any Affiliate thereof) receives or may receive additional compensation from mutual funds or other third parties or Affiliates that could be deemed to be in Escrow Agent’s self interest for (x) effecting investments in securities and other investments or (y) serving as escrow agent, transfer agent, custodian, subcustodian, administrator, or shareholder servicing agent, or other non-advisory capacity. No transactional confirmation shall be required for any investment or reinvestment transaction (buy, sale, or other) that is otherwise covered by a monthly statement. No investment shall be made in any instrument or security that has a maturity of greater than six (6) months. Notwithstanding anything to the contrary contained herein, Escrow Agent may, without notice to Depositor, Recipient, or the Representatives, sell or liquidate any of the foregoing investments at any time if the proceeds thereof are required for any disbursement of such moneys permitted or required hereunder. All investment earnings shall become part of such moneys and investment losses shall be charged against such moneys Funds. Escrow Agent shall not be liable or responsible for loss in the value of any investment made pursuant to this Agreement, or for any loss, cost or penalty resulting from any sale or liquidation of such moneys. With respect to any such moneys received by Escrow Agent after 1:00 p.m., New York time, Escrow Agent shall not be required to invest such funds or to effect any investment instruction until the next day upon which Escrow Agent is open for regular business hours.

 

7.

Suspension of Performance; Release to Court. If, at any time, (i) there shall exist any dispute between or among Depositor, Recipient and/or either of the Representatives with respect to the holding or disposition of all or any portion of the Escrow Property or any other obligations of Escrow Agent hereunder, (ii) Escrow Agent is unable to determine, to Escrow Agent’s sole satisfaction, the proper disposition of all or any portion of the Escrow Property or Escrow Agent’s proper actions with respect to its obligations hereunder, or (iii) the Representatives have not, within thirty (30) days of the furnishing by Escrow Agent of a notice of resignation pursuant to Section 8 hereof, appointed a successor escrow agent to act hereunder (which such successor escrow agent has accepted such appointment), then Escrow Agent may, in its sole discretion, take either or both of the following actions:

 

(a)

suspend the performance of any of its obligations under this Agreement until such dispute or uncertainty shall be resolved to the sole satisfaction of Escrow Agent or until a successor escrow agent shall have been appointed (as the case may be).

 

(b)

petition (by means of an interpleader action or any other appropriate method) any court of competent jurisdiction in any venue convenient to Escrow Agent, for instructions with respect to such dispute or uncertainty, and to the extent required or permitted by law, put into trust in such court, for holding and disposition in accordance with the instructions of such court, all Escrow Property and Depositor and Recipient shall pay Escrow Agent of all fees, costs and expenses (including court costs and expenses and attorneys’ fees) or any other amount payable to, incurred by, or expected to be incurred by Escrow Agent in connection with the performance of its duties and the exercise of its rights hereunder.

 

Escrow Agent shall have no liability to Depositor, Recipient, or either of the Representatives, or to their respective shareholders, partners, or members, officers or directors, employees, Affiliates or any other person with respect to any such suspension of performance or deposit into trust in court, specifically including any liability or claimed liability that may arise, or be alleged to have arisen, out of or as a result of any delay in the disbursement of Escrow Property or any delay in or with respect to any other action required or requested of Escrow Agent.

 

8.

Resignation of Escrow Agent. Escrow Agent may resign and be discharged from the performance of its duties hereunder at any time by giving ten (10) days’ prior written notice to Depositor, Recipient, and the Representatives specifying the date when such resignation shall take effect. Upon any such notice of resignation, the Representatives shall jointly issue to Escrow Agent a Joint Written Direction authorizing redelivery of the Escrow Property to a bank or trust company that has been retained as successor to Escrow Agent hereunder prior to the effective date of such resignation. The retiring Escrow Agent shall transmit all records pertaining to the Escrow Property and shall pay all Escrow Property to the successor escrow agent, after making copies of such records as the retiring Escrow Agent deems advisable and after deduction and payment to the retiring Escrow Agent of all fees, costs and expenses (including court costs and expenses and attorneys’ fees) or any other amount payable to, incurred by, or expected to be incurred by the retiring Escrow Agent in connection with the performance of its duties and the exercise of its rights hereunder.

 

After any retiring Escrow Agent’s resignation, the provisions of this Agreement shall inure to its benefit as to any actions taken or omitted to be taken by it while it was Escrow Agent under this Agreement. Any corporation or other entity into which Escrow Agent may be merged or converted or with which it may be merged or consolidated, or any other entity to which all or a majority of all of Escrow Agent’s escrow business may be transferred by sale of assets or otherwise, shall be Escrow Agent under this Agreement without further act or consent of any party hereto.

 

9.

Liability of Escrow Agent. Escrow Agent undertakes to perform only the ministerial duties as are expressly set forth herein and no other duties and obligations (fiduciary or otherwise) shall be implied. Escrow Agent shall have no duty to enforce any obligation of any other person to make any payment or delivery, or to direct or cause any payment or delivery to be made, or to enforce any obligation of any other person to perform any other act. Escrow Agent shall have no liability under and no duty to inquire as to the provisions of any agreement (even though such agreement may be referenced in this Agreement) other than this Agreement. In the event of any conflict between the terms and provisions of this Agreement and any other agreement, as to Escrow Agent, the terms and conditions of this Agreement shall control subject to Section 30 hereof. Escrow Agent is not a party to the Underlying Agreement, is not bound by any of its terms, and has not undertaken in any way to effectuate, implement or comply with the Underlying Agreement. Escrow Agent shall not be liable to Depositor or Recipient or to anyone else for any action taken or omitted by it in good faith except to the extent that a court of competent jurisdiction determines that Escrow Agent’s gross negligence or willful misconduct was the primary cause of any loss to Depositor or Recipient. Escrow Agent’s sole responsibility shall be for the safekeeping and disbursement of the Escrow Property in accordance with the terms of this Agreement. Escrow Agent shall have no implied duties or obligations and shall not be charged with knowledge or notice of any fact or circumstance not specifically set forth herein. Escrow Agent shall have no duty to solicit any payment which may be due to be paid in Escrow Property or to confirm or verify the accuracy or correctness of any amounts deposited in accordance with this Agreement. Escrow Agent may rely conclusively, and shall be protected in acting, upon any notice, instruction (including a Joint Written Direction (such as a wire transfer instruction)), request, order, judgment, certification, opinion or advice of counsel (including counsel chosen by Escrow Agent), statement, demand or other instrument or document, not only as to its due execution, validity (including the authority of the person signing or presenting the same) and effectiveness, but also as to the truth and accuracy of any information contained therein, which Escrow Agent shall believe to be genuine and to have been signed or presented by the person or parties purporting to sign the same. In no event shall Escrow Agent be liable for incidental, indirect, special, consequential or punitive damages of any kind whatsoever (including lost profits), even if Escrow Agent has been advised of the likelihood of such loss or damage and regardless of the form of action. The officers, directors, members, partners, trustees, employees, agents, attorneys or other representatives and Affiliates of Escrow Agent owe no duty or obligation to any party hereunder and shall have no liability to any person by reason of any error of judgment, for any act done or not done, for any mistake of fact or law, or otherwise.

 

Escrow Agent shall not be obligated to take any legal or other action or commence any proceeding in connection with the Escrow Property, any account in which Escrow Property are deposited, this Agreement or the Underlying Agreement, or to appear in, prosecute or defend any such legal action or proceeding (whether or not it shall have been furnished with acceptable indemnification and advancement). Escrow Agent may consult legal counsel selected by it in the event of any dispute or question as to the construction of any of the provisions hereof or of any other agreement or of its duties hereunder, or relating to any dispute or question involving any party hereto, and shall incur no liability and shall be fully indemnified from any liability whatsoever in acting in accordance with the opinion or instruction of such counsel. Depositor and Recipient, jointly and severally, shall promptly pay, upon demand, the reasonable fees, costs and expenses of any such counsel.

 

Escrow Agent shall have the right to assume in the absence of written notice to the contrary from the proper person or persons that a fact or an event by reason of which an action would or might be taken by Escrow Agent does not exist or has not occurred, without incurring liability to the other parties hereto or to anyone else for any action taken or omitted, or any action suffered by it to be taken or omitted, in good faith, in reliance upon such assumption.

 

Escrow Agent is authorized, in its sole discretion, to comply with orders issued or process entered by any court with respect to the Escrow Property, without determination by Escrow Agent of such court’s jurisdiction in the matter. If any portion of the Escrow Property is at any time attached, garnished or levied upon under any court order, or in case the payment, assignment, transfer, conveyance or delivery of any such property shall be stayed or enjoined by any court order, or in case any order, judgment or decree shall be made or entered by any court affecting such property or any part thereof, then and in any such event, Escrow Agent is authorized, in its sole discretion, to rely upon and comply with any such order, writ, judgment or decree which it is advised by legal counsel selected by it is binding upon it without the need for appeal or other action; and if Escrow Agent complies with any such order, writ, judgment or decree, it shall not be liable to any of the parties hereto or to any other person or entity by reason of such compliance even though such order, writ, judgment or decree may be subsequently reversed, modified, annulled, set aside or vacated.

 

10.

Indemnification of Escrow Agent. From and at all times after the date of this Agreement, Depositor and Recipient, jointly and severally, shall, to the fullest extent permitted by law, defend, indemnify and hold harmless Escrow Agent and each director, officer, member, partner, trustee, employee, attorney, agent and Affiliate of Escrow Agent (collectively, the “Indemnified Parties”) against any and all actions, claims (whether or not valid), losses, damages, liabilities, costs, penalties, settlements, judgments and expenses of any kind or nature whatsoever (including costs and expenses and reasonable attorneys’ fees) incurred by or asserted against any of the Indemnified Parties from and after the date hereof, whether direct, indirect or consequential, as a result of, in connection with, or arising from or in any way relating to any claim, demand, suit, action or proceeding (including any inquiry or investigation) by any person, including Depositor, Recipient and/or the Representatives, whether threatened or initiated, asserting a claim for any legal or equitable remedy against any person (whether it is an Indemnified Party or not) under any statute or regulation, including any federal or state securities laws, or under any common law or equitable cause or otherwise, arising from or in connection with the negotiation, preparation, execution, performance or failure of performance of this Agreement or any transactions contemplated herein or relating hereto (including tax reporting or withholding or the enforcement of any rights or remedies under or in connection with this Agreement), whether or not any such Indemnified Party is a party to any such action, proceeding, suit or the target of any such inquiry or investigation (without derogation of any other indemnity afforded to Escrow Agent); provided, however, that no Indemnified Party shall have the right to be indemnified hereunder for any liability finally determined by a court of competent jurisdiction, subject to no further appeal, to have resulted solely from the gross negligence or willful misconduct of such Indemnified Party. Each Indemnified Party shall, in its sole discretion, have the right to select and employ separate counsel with respect to any action or claim brought or asserted against it, and the reasonable fees of such counsel (and such counsel’s costs and expenses) shall be paid, upon demand, by Depositor and Recipient jointly and severally.

 

The parties hereto agree that neither the payment by Depositor or Recipient of any claim by Escrow Agent for indemnification hereunder nor the disbursement of any amounts to Escrow Agent from the Escrow Property in respect of a claim by Escrow Agent for indemnification shall impair, limit, modify, or affect, as between Depositor and Recipient, the respective rights and obligations of Depositor, on the one hand, and Recipient, on the other hand, under the Underlying Agreement.

11.

Fees, Costs and Expenses of Escrow Agent. Depositor and Recipient shall compensate Escrow Agent for its services hereunder in accordance with Schedule A attached hereto and, in addition, shall reimburse Escrow Agent for all of its reasonable out-of-pocket costs and expenses, including attorneys’ fees, travel expenses, telephone and facsimile transmission costs, postage (including express mail and overnight delivery charges), copying charges and the like. The additional provisions and information set forth on Schedule A hereto are hereby incorporated by this reference, and form a part of this Agreement. All of the compensation and reimbursement obligations set forth in this Section 11 shall be payable by Depositor upon execution of this Agreement and, in the future, upon demand by Escrow Agent. Escrow Agent shall notify the Representatives of any release from the Escrow Property to itself or any other Indemnified Party in respect of any compensation or reimbursement hereunder and shall furnish to the Representatives copies of all related invoices and other statements.

 

12.	Representations and Warranties. Each of Depositor and Recipient severally covenants and makes the following representations and warranties to Escrow Agent:

 

(a)

It is duly organized, validly existing, and in good standing under the laws of the state or country of its incorporation or organization, and has full power and authority to execute and deliver this Agreement and to perform its obligations hereunder.

 

(b)

It possesses such valid and current licenses, certificates, authorizations or permits issued by the appropriate state, federal or foreign regulatory agencies or bodies necessary to conduct its respective businesses, and it has not received any notice of proceedings relating to the revocation or modification of, or non-compliance with, any such license, certificate, authorization or permit.

 

(c)

This Agreement has been duly approved by all necessary action, including any necessary shareholder or membership approval, has been executed by its duly authorized officers, and constitutes its valid and binding agreement enforceable in accordance with its terms.

 

(d)

The execution, delivery, and performance of this Agreement is in accordance with the Underlying Agreement and will not violate, conflict with, or cause a default under its articles of incorporation, bylaws, management agreement or other organizational document, as applicable, any applicable law, rule or regulation, any court order or administrative ruling or decree to which it is a party or any of its property is subject, or any agreement, contract, indenture, or other binding arrangement, including the Underlying Agreement, to which it is a party or any of its property is subject.

 

(e)

The applicable persons designated on Schedule A hereto have been duly appointed to act as its representatives hereunder and have full power and authority to execute and deliver any Joint Written Direction, to amend, modify or waive any provision of this Agreement and to take any and all other actions as the Representatives under this Agreement, all without further consent or direction from, or notice to, it or any other party.

 

(f)

No party other than the parties hereto has, or shall have, any lien, claim or security interest in the Escrow Property or any part thereof. No financing statement under the Uniform Commercial Code is on file in any jurisdiction claiming a security interest in or describing (whether specifically or generally) the Escrow Property or any part thereof.

 

(g)

All of its representations and warranties contained herein are true and complete as of the date hereof and will be true and complete at the time of any disbursement of Escrow Property.

 

13.	Patriot Act Disclosure; Taxpayer Certification and Reporting.

 

(a)

Patriot Act Disclosure. Depositor and Recipient acknowledge that a portion of the identifying information set forth on Schedule A hereto is being requested by Escrow Agent in connection with the USA Patriot Act, Pub.L.107-56 (the “Act”), and Depositor and Recipient agree to provide any additional information requested by Escrow Agent in connection with the Act or any similar law, rule, regulation, order, or other governmental act to which Escrow Agent is subject, in a timely manner and consent to Escrow Agent obtaining from third parties any such identifying information. Depositor and Recipient each represent that all identifying information set forth on Schedule A hereto, including its Taxpayer Identification Number assigned by the Internal Revenue Service or any other taxing authority, is true and complete on the date hereof and will be true and complete at the time of any disbursement of Escrow Property. For a non-individual person such as a charity, a trust, or other legal entity, Escrow Agent may require documentation to verify formation and existence as a legal entity. Escrow Agent may also require financial statements, licenses, identification and authorization documentation from any individual claiming authority to represent the entity or other relevant documentation.

 

(b)

Certification and Tax Reporting. Depositor and Recipient have provided Escrow Agent with their respective fully executed Internal Revenue Service (“IRS”) Form W-8, or W-9 and/or other required documentation. Depositor and Recipient acknowledge that solely for tax purposes, Escrow Agent does not have any interest in the Escrow Property or the escrow account. All interest or other income earned under this Agreement shall be allocated to Recipient and reported, as and to the extent required by law, by Escrow Agent to the IRS, or any other taxing authority, on IRS Form 1099 or 1042S (or other appropriate form) as income earned from the Escrow Property by Recipient whether or not said income has been distributed during such year. Recipient shall timely file all tax returns and pay all taxes due with respect to any income earned or losses generated with respect to the Escrow Property. Escrow Agent shall not have any liability for the payment of taxes with respect to the Escrow Property. Recipient or Depositor shall indemnify and hold Escrow Agent harmless from and against all such taxes, depending on whether the Taxes were caused by then Released Shares, in which case the Recipient shall be responsible, or then Unpaid Escrow Shares, in which case the Depositor shall be responsible. Escrow Agent shall withhold any taxes it deems appropriate in the absence of proper tax documentation or as required by law, and shall remit such taxes to the appropriate authorities. Depositor and Recipient hereby represent and warrant to Escrow Agent that (i) there is no sale or transfer of a United States Real Property Interest as defined under Section 897(c) of the Internal Revenue Code of 1986, as amended, in the underlying transaction giving rise to this Agreement and (ii) such underlying transaction does not constitute an installment sale requiring any tax reporting or withholding of imputed interest or original issue discount to the IRS or other taxing authority.

 

14.

Consent to Jurisdiction and Venue. In the event that any party hereto commences a lawsuit or other proceeding relating to or arising from this Agreement, the parties hereto agree that the United States District Court for the Southern District of the State of New York shall have the sole and exclusive jurisdiction over any such proceeding. If such court lacks federal subject matter jurisdiction, the parties hereto agree that the Supreme Court of the State of New York within New York County shall have sole and exclusive jurisdiction. Any final judgment shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Any of these courts shall be proper venue for any such lawsuit or judicial proceeding and the parties hereto waive any objection to such venue and irrevocably and unconditionally waive and agree not to plead or claim in any such court that any such suit or proceeding in any such court has been brought in an inconvenient forum.

 

The parties hereto consent to and agree to submit to the jurisdiction of any of the courts specified herein and agree to accept service of process to vest personal jurisdiction over them in any of these courts.

 

Each party hereto irrevocably and unconditionally waives any right to a trial by jury and agrees that any of them may file a copy of this section of this Agreement with any court as written evidence of the knowing, voluntary and bargained-for agreement among the parties hereto irrevocably to waive the right to trial by jury in any litigation related to or arising under this Agreement.

 

15.

Notice. All notices, instructions (pursuant to a Joint Written Direction or otherwise), approvals, consents, requests, and other communications hereunder shall be in writing and shall be deemed to have been given (a) when such writing is delivered by hand or overnight delivery service, or (b) upon telephone call-back in accordance with Section 16 below, after being sent by e-mail with PDF attachment from the designated e-mail account(s) of the sending person(s) as designated on Schedule A hereto to the designated e-mail account(s) of the receiving person(s) as designated on Schedule A hereto or (c) three (3) Business Days after being mailed by first class mail (postage prepaid), in each case to the address set forth on Schedule A hereto or to such other address as each party hereto may designate for itself by like notice.

 

16.

Security Procedures. If notices, instructions (pursuant to a Joint Written Direction or otherwise), approvals, consents, requests, and other communications, are received by Escrow Agent by e-mail at its e-mail account(s) as designated on Schedule A hereto, Escrow Agent is authorized, but not required, to seek prompt confirmation of such communications by telephone call-back to the sending person or persons’ telephone number(s) as designated on Schedule A hereto, and Escrow Agent may rely upon the confirmation of anyone purporting to be the person or persons so designated in that call-back. Any e-mail by PDF attachment executed by more than one person shall be sent by each signatory. The persons and their telephone numbers authorized to receive call-backs as designated in Schedule A hereto may be changed only in a writing actually received and acknowledged by Escrow Agent and delivered in accordance with Section 15 above and, if applicable, this Section 16. If Escrow Agent is unable to contact any such designated person, Escrow Agent is hereby authorized (but not required) both to receive written instructions from and seek confirmation of such instructions by telephone call-back to any one or more of Depositor’s or Recipient’s executive officers (each, an “Executive Officer”), as the case may be, who shall include individuals holding titles of Chief Executive Officer, President, Chief Financial Officer. Such Executive Officer(s) shall deliver to Escrow Agent a fully executed incumbency certificate upon Escrow Agent’s request, and Escrow Agent may rely upon the confirmation of anyone purporting to be any such Executive Officer(s). The parties to this Agreement acknowledge and agree that the security procedures set forth above are commercially reasonable.

 

Escrow Agent in any funds transfer may rely solely upon any account numbers or similar identifying numbers provided by the parties hereto to identify (i) a beneficiary, (ii) a beneficiary’s bank, or (iii) an intermediary bank. Escrow Agent may apply any of the Escrow Property for any payment order it executes using any such identifying number, even where its use may result in a person other than a beneficiary being paid, or the transfer of funds to a bank other than a beneficiary’s bank or an intermediary bank designated.

 

17.

Amendment or Waiver. This Agreement may be changed, waived, discharged or terminated only by a writing signed by the parties hereto. No delay or omission by any party hereto in exercising any right with respect hereto shall operate as a waiver. A waiver on any one occasion shall not be construed as a bar to, or waiver of, any right or remedy on any future occasion.

 

18.	Severability. To the extent any provision of this Agreement is prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Agreement.

 

19.	Governing Law. This Agreement shall be construed and interpreted in accordance with the internal laws of the State of New York without giving effect to the conflict of laws principles thereof.

 

20.	Entire Agreement. This Agreement constitutes the entire agreement between the parties hereto relating to the holding, investment and disbursement of Escrow Property and sets forth in their entirety the obligations and duties of Escrow Agent with respect to the Escrow Property.

 

21.	Binding Effect. All of the terms of this Agreement, as amended from time to time, shall be binding upon, inure to the benefit of and be enforceable by the respective successors and assigns of Depositor, Recipient and Escrow Agent.

 

22.

Execution in Counterparts. This Agreement and any Joint Written Direction may be executed in two or more counterparts, which when so executed shall constitute one and the same agreement or direction. Subject to Section 15 and Section 16 hereof, this Agreement and any Joint Written Direction may be executed and delivered by e-mailing a PDF version of a signed signature page, which shall have the same force and effect as the delivery of an originally executed signature page.

 

23.

Termination of Escrow Agent. Upon the first to occur of (i) the termination of the Escrow Period (and the occurrence of the related distribution(s)), (ii) the disbursement of all amounts in the Escrow Property pursuant to one or more Joint Written Directions, into court pursuant to Section 7 hereof, in accordance with applicable state escheatment and unclaimed property laws or otherwise or (iii) the resignation of Escrow Agent, Escrow Agent shall be released from its obligations hereunder and Escrow Agent shall have no further obligation or liability whatsoever with respect to this Agreement or the Escrow Property. The obligations of Depositor and Recipient continue to exist notwithstanding the termination or discharge of Escrow Agent’s obligations or liabilities hereunder until the obligations of Depositor and Recipient have been fully performed.

 

24.

Dealings. Escrow Agent and any stockholder, director, officer or employee of Escrow Agent may buy, sell, and deal in any of the securities of Depositor or Recipient and become pecuniarily interested in any transaction in which Depositor or Recipient may be interested, and contract and lend money to Depositor or Recipient and otherwise act as fully and freely as though it were not Escrow Agent under this Agreement. Nothing herein shall preclude Escrow Agent from acting in any other capacity for Depositor or Recipient or for any other entity.

 

25.	Currency. The currency applicable to any amount payable or receivable under this Agreement is United States dollars.

 

26.

Late Payment. If any amount due to Escrow Agent under this Agreement is not paid within 30 days (subject to any longer time period prescribed herein) after notice to Depositor and/or Recipient (other than any amount that is subject to good faith dispute), Depositor and Recipient jointly and severally shall pay interest thereon (from the due date to the payment date) at a per annum rate equal to ten (10) percent.

 

27.

Force Majeure. Notwithstanding anything to the contrary hereunder, Escrow Agent shall not be liable for any delay, failure to perform, or other act or non-act resulting from acts beyond its reasonable control, including acts of God, terrorism, shortage of supply, labor difficulties (including strikes), war, civil unrest, fire, floods, electrical outages, equipment or transmission failures, internet interruption, vendor failures (including information technology providers), and other similar causes.

 

28.

No Third Party Beneficiaries. This Agreement and all of its terms and conditions are for the sole and exclusive benefit of the parties hereto and their respective permitted successors and assigns. Nothing expressed or referred to in this Agreement will be construed to give any person or entity other than the parties to this Agreement any legal or equitable rights, remedy, or claim under or with respect to this Agreement or any term or condition of this Agreement.

 

29.

No Strict Construction. The parties hereto have participated jointly in the negotiation and draft of this Agreement. In the event any ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if it were drafted jointly by the parties hereto, and no presumption or burden of proof shall arise favoring or disfavoring any party hereto by virtue of authorship of any provision of this Agreement.

 

30.

Priority.

 

(a)

In the event of any conflict between the provisions of Schedule A hereto and the remainder of this Agreement, this Agreement shall be construed in a manner prescribed by Escrow Agent acting in good faith.

 

(b)

Nothing contained in this Agreement shall amend, replace or supersede any agreement between Depositor or Recipient and Escrow Agent to act as Depositor’s or Recipient’s transfer agent, which agreement shall remain of full force and effect.

 

31.

Headings. The headings in this Agreement are for convenience purposes and shall be ignored for purposes of enforcing this Agreement, do not constitute a part of this Agreement, and may not be used by any party hereto to characterize, interpret, limit or affect otherwise any provision of this Agreement.

 

[signature page follows]

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first above written.

 

1.	Intentionally Omitted.

2.	Escrow Agent Fees.

The Acceptance Fee and the Annual Escrow Fee for each year of the term of this Agreement are payable upon execution of this Agreement. In the event the escrow is not funded, the Acceptance Fee and all related expenses, including attorneys’ fees, costs and expenses remain due and payable, and if paid, will not be refunded. Annual fees cover a full year in advance, or any part thereof, and thus are not pro-rated in the year of termination.

The fees quoted in this schedule apply to services ordinarily rendered in the administration of an escrow account and are subject to reasonable adjustment based on final review of documents, or when Escrow Agent is called upon to undertake unusual or extraordinary duties or responsibilities, or as changes in law, procedures, or the cost of doing business demand. Services in addition to and not contemplated in this Agreement, including document amendments and revisions, non-standard cash and/or investment transactions, calculations, notices and reports, and legal fees, will be billed as expenses.

Unless otherwise indicated, the above fees relate to the establishment of one escrow account. Additional sub-accounts governed by this Agreement may incur an additional charge. Transaction costs include charges for wire transfers, checks, internal transfers and securities transactions.

The fees quoted in this schedule are subject to reasonable adjustment by Escrow Agent in accordance with its customary practices and if it is called upon to undertake further unusual or extraordinary duties or responsibilities, or as changes in law, procedures, or the cost of doing business demand.

 

3.	Taxpayer Identification Numbers.

 

4.

Termination and Disbursement. Unless earlier terminated by the provisions of this Agreement, the Escrow Period will terminate on the earlier of the date all of the Escrow Property is released from Escrow, termination of the Underlying Agreement and February 8, 2026 (the “Termination Date”). Depositor and Recipient shall have the right to require return of any Escrow Property remaining in the escrow account on such date by delivering to Escrow Agent a Joint Written Direction, and any Escrow Property remaining in the escrow account at such time shall be distributed in accordance with Section 5 of this Agreement and the Joint Written Direction; provided, however, that any earnings thereon shall be distributed in accordance with Section 13(b) of this Agreement.

5.	Investment Instructions. Citibank Insured Money Market Account.

6.	Representatives. The following person is hereby designated and appointed as Depositor Representative under this Agreement:

7.	Notice Addresses.

If to Depositor or Depositor Representative at:

▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ #▇▇▇

▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇

Attn: CEO

Tel: (▇▇▇) ▇▇▇-▇▇▇▇

With copy to:

▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇

▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇

▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇

Attn: ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇

Tel: (▇▇▇) ▇▇▇-▇▇▇▇

If to Recipient at:

Youji Company Limited

▇▇▇▇ ▇▇, ▇/▇, ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,

▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇

Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇

Tel:

 

If to Recipient Representative at:

▇▇▇▇▇▇ ▇▇▇▇▇▇

Tel:

If to Escrow Agent at:

American Stock Transfer & Trust Company, LLC

▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇

▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇

Attn: Corporate Actions

Tel: (▇▇▇) ▇▇▇.▇▇▇▇

with copy to:

American Stock Transfer & Trust Company, LLC

▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇

▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇

Attn: General Counsel

Tel: (▇▇▇) ▇▇▇.▇▇▇▇

8.	Designated Email Accounts and Telephone Call-Back Numbers (for persons designated to send and receive notices by e-mail).

 

	Depositor:	Name	Email Address	Phone
	Depositor Representatives:	Name	Email Address	Phone
	Recipient:	Name	Email Address	Phone
	Recipient Representative:	Name	Email Address	Phone
	Escrow Agent:	Name	Email Address	Phone

 

Extruder for use at Urmatt Rice ▇▇▇▇▇

Description:

Proprietary and trade secret machine designed and assembled by RiceBran Technologies (“▇▇▇”) from components made by contract manufacturers according to ▇▇▇ specifications (the “Extruder”). The Extruder’s intended operating purpose is to receive raw rice bran generated from the rice milling process and stabilize the raw rice bran to produce stabilized rice bran (“SRB”) by deactivating the lipase enzyme activity that naturally occurs in raw rice bran as a result of the milling process. The quality of SRB produced by the Extruder will depend on many factors including, among others, the quality of the raw rice bran received for stabilization and the time elapsed between the milling of the raw rice bran and the introduction of that bran into the Extruder for stabilization.  Optimal performance can be obtained if raw rice bran is introduced into the Extruders within minutes of milling.  Assuming (i) the motors and control panels of the Extruders are modified to accept local Chinese power inputs or replaced with local equivalent motors and control panels, (ii) an adequate supply and quality of fresh raw rice bran is delivered for processing within one hour of milling and free of impurities such as stones, ceramics, metal, excess hulls, etc., (iii) the Extruders are installed, maintained and operated as directed by ▇▇▇ technicians (including use of ▇▇▇ specified parts) and (iv) Urmatt personnel do not damage the Extruders, during the Warranty Term (a) each Extruder will have a processing output of a minimum of approximately 2,000 pounds of SRB per hour and (b) the SRB produced by the Extruder will be fit for use in animal nutrition and human food ingredients.

 

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