EMPLOYMENT SEVERANCE AGREEMENT

1.              Separation from Employment. Employee's employment with NutraCea terminated pursuant to the Employment Agreement originally entered into on October 20, 2003, and amended pursuant to the First Amendment to Employment Agreement dated October 5, 2005, and the Second Amendment to Employment Agreement dated July 19, 2008 (collectively "Employment Agreement"). Such date of termination is referred to herein as the "Termination Date". This Agreement shall be effective as of such Termination Date unless otherwise provided in the Employment Agreement.

2.              Severance Payments. NutraCea does not have a policy or obligation to pay severance pay, but nevertheless, agrees to make severance payments to Employee as set forth in this Section 2. Subject to and conditioned upon Employee's compliance with each and every obligation of Employee set forth herein, specifically including, without limitation, Employee's obligations of no disparagement, no solicitation, non-interference, and confidentiality as set forth in Sections 9, 10 and 11 of this Agreement, NutraCea agrees to pay to Employee one lump sum severance payment equal to Employee's current annual salary, which is equal to the annual salary amount payable to Employee pursuant to the Employment Agreement as in effect immediately prior to the Termination Date. (the "Severance Payment"). In addition to the Severance Payment, NutraCea agrees to pay in full on or prior to the Termination Date, the car lease referenced on Exhibit A attached hereto, and to assign to Employee the computer items referenced on Exhibit A attached hereto.

2.1.              Payments Schedule; Withholding.   NutraCea shall pay Employee the Severance Payment on or before, ______________, in accordance with NutraCea's standard payroll practices. The severance payment shall be subject to the customary withholding tax and other employment taxes as required with respect to compensation paid to its employees.

2.2.              Medical and Health Benefits.   Employee will also be offered the opportunity for continued coverage under NutraCea's health insurance plans until March 31, 2009. Thereafter, NutraCea shall reimburse employee for his subsequent COBRA payments made after March 31, 2009 and continuing for eighteen (18) months thereafter, unless during such time, Employee becomes eligible to obtain coverage under Medicare Plans A and B, in which case. NutraCea shall be under no further obligation to reimburse Employee for such COBRA payments. NutraCea's insurance agent will   send Employee information regarding this coverage.

2.3              Stock Option Grants.   The options, warrants and any other rights identified on Exhibit B, as acknowledged and approved by the Company's CEO will remain vested, or shall become vested and capable of exercise pursuant to their terms, as provided in the stock option agreements delivered pursuant to NutraCea's equity incentive plans. All options assumed by NutraCea from RiceX identified on Exhibit B are (1) approved to be exercisable using a cashless exercise (net exercise) provision, provided this method of exercise is chosen by optionee as the method of exercise; and (2) amended in the event the optionee dies or becomes disabled, the expiration period shall be one year from the date of death or disability. Additionally, the options which are scheduled to expire on October 4, 2008 shall be amended to extend the expiration period three years from termination date. The Company shall also waive all performance requirements for the option issued to Employee on January 8, 2008.

2.4               Director and Officer Insurance Indemnity .   NutraCea shall maintain current levels of officer's insurance for the benefit of Employee on the terms provided in the Indemnification Agreement between NutraCea and Employee as in effect on the Termination Date.

3.              Payment of Salary. Employee's vacation and sick leave shall cease accruing on the Termination Date. Aside from the severance payments set forth in Section 2 of this Agreement, Employee acknowledges and represents that NutraCea has paid all salary, wages, bonuses, accrued vacation, commissions and any and all other benefits due to Employee.

4.              Business Expenses. Employee acknowledges and warrants to NutraCea that Employees has been reimbursed for all business expenses, in accordance with NutraCea's reimbursement policy.

5.               Release of Liability. Employee acknowledges that he enters this Agreement freely and voluntarily, and agrees as follows:

5.1             ADEA Waiver. Employee acknowledges that he is knowingly and voluntarily waiving and releasing any rights Employee may have under the Age Discrimination in Employment Act of 1967, as amended ("ADEA"). Employee also acknowledges that the consideration given for the waiver and release pursuant to this Agreement is in addition to anything of value to which Employee was already entitled. Employee further acknowledges that he has been advised by this Agreement in writing, as required by the ADEA, that:

5.2               Statutory Claims. Employee acknowledges that Title VII of the Civil Rights Act of 1964, as amended, the Civil Rights Act of 1991, the Americans With Disabilities Act, the Age Discrimination in Employment Act of 1967, the Rehabilitation Act of 1973, the Vietnam Era Veterans Readjustments Assistance Act of 1974, the Federal Family and Medical Leave Act of 1993, the California Family Rights Act of 1991, the Federal Family and Medical Leave Act of 1993. and the California Fair Employment and Housing Act, as amended, and applicable provisions of California's Labor Code provide the right to an employee to bring charges, claims or complaints against an employer if Employee believes he has been discriminated against on a number of bases, including race, ancestry, color, religion, sex, marital status, national origin, age, status as a veteran of the Vietnam era, request or need for family or medical leave, physical or mental disability, medical condition or sexual preference. Employee, with full understanding of the rights afforded to him or her under these federal and state laws, agrees that he will not file, or cause to be filed against NutraCea, any charges, complaints, or actions based on any alleged violation of these federal and state laws, or any successor or replacement federal or state laws. Employee hereby waives any right to assert a claim for relief available under these federal and state laws including, but not limited to, back pay, front pay, attorneys' fees, damages, consequential damages, punitive damages, reinstatement, or injunctive relief, which Employee may otherwise recover based on any alleged violation of these federal and state laws, or any successor or replacement federal or state laws.

5.3.             Common Law Claims. Employee acknowledges that   he may have certain common law rights to file a lawsuit claiming wrongful discharge in violation of an express and/or implied contract or in violation of a public policy. Employee expressly waives any and all tort and/or contract claims that he may have against NutraCea for wrongful discharge, misrepresentation, fraud, defamation, interference with prospective business advantage, interference with contractual relationships, intentional and/or negligent infliction of emotional distress, negligence, promissory estoppel, and/or breach of the covenant of good faith and fair dealing.

5.4              General Release. Employee hereby irrevocably and unconditionally releases and forever discharges NutraCea and all of its officers, agents, directors, supervisors, employees, representatives, affiliates, related companies, and their successors and assigns and all persons acting by, through, under or in concert with any of them from any and all   charges, complaints, grievances, claims, actions, and liabilities of any kind (including attorneys' fees, interest, expenses and costs actually incurred) of any nature whatsoever, known or unknown, suspected or unsuspected (hereinafter referred to as "Claims"), which Employee has or may have in the future, arising out of Employee's employment with NutraCea. All such Claims are forever barred by this Agreement and without regard to whether these Claims are based on any alleged breach of duty arising in contract or tort, any alleged employment discrimination or other unlawful discriminatory act, or any claim or cause of action regardless of the forum in which it may be brought, including without limitation, claims under the National Labor Relations Act (to the extent permitted by law), Title VII of th