Rentech Announces Settlement of Securities Class Action and Shareholder Derivative Lawsuits
24 March 2011 - 12:00AM
Business Wire
Rentech, Inc. (NYSE AMEX: RTK) announced today that it has
reached agreements to settle all of the class action lawsuits
pending in federal court and all of the shareholder derivative
lawsuits pending in state and federal court against the Company and
a number of its current and former directors and officers. The
lawsuits relate to the Company’s restatement in December 2009 of
certain of its financial statements for fiscal year 2008 and the
first three quarters of fiscal year 2009. The Company believes that
it is in the best interests of its stockholders to settle the
matters at a reasonable cost to avoid potentially protracted and
expensive litigation. The Company and the individual defendants
have denied any liability or wrongdoing in connection with the
allegations contained in these lawsuits.
The settlement for the consolidated class action lawsuits
pending in United States District Court for the Central District of
California (In re Rentech Securities Litigation, Lead Case
No. 2:09-cv-09495-GHK-PJW) provides for a settlement fund of
$1.8 million, from which plaintiffs’ counsel will seek an award of
attorneys fees and expenses. The settlements for the consolidated
shareholder derivative lawsuits pending in United States District
Court for the Central District of California (In re Rentech
Derivative Litigation, Lead Case No. 2:10-cv-0485-GHK-PJW) and
the Superior Court of the State of California for the County of Los
Angeles (Andrew L. Tarr v. Dennis L. Yakobson, et al., LASC Master
File No. BC430553) provide that the Company will adopt certain
governance practices, and pay (or cause its insurance carrier to
pay) plaintiffs’ attorneys fees and expenses of up to $300,000. The
Company expects that over 90% of the aggregate securities class
action and shareholder derivative settlement payments will be
covered by its insurance carriers.
The settlements are subject to court approval and certain other
conditions including notice to the Company’s stockholders.
About Rentech, Inc.
Rentech, Inc. (www.rentechinc.com), incorporated in 1981,
provides clean energy solutions. The Company's Rentech-SilvaGas
biomass gasification process can convert multiple biomass
feedstocks into synthesis gas (syngas) for production of renewable
fuels and power. Combining the gasification process with Rentech's
unique application of syngas conditioning and clean-up technology
and the patented Rentech Process based on Fischer-Tropsch
chemistry, Rentech offers an integrated solution for production of
synthetic fuels from biomass. The Rentech Process can also convert
syngas from fossil resources into ultra-clean synthetic jet and
diesel fuels, specialty waxes and chemicals. Final product
upgrading and acid gas removal technologies are provided under an
alliance with UOP, a Honeywell company. Rentech develops projects
and licenses these technologies for application in synthetic fuels
and power facilities worldwide. Rentech Energy Midwest Corporation,
the Company's wholly-owned subsidiary, manufactures and sells
nitrogen fertilizer products including ammonia, urea ammonia
nitrate, urea granule, and urea solution in the corn-belt region of
the central United States. Rentech has been recognized by Biofuels
Digest as one of the “50 Hottest Companies in Bio-energy” and has
been named as one of the “Biofuels Digest Companies of the Year”
for its innovations and achievements, particularly in aviation
biofuels.
Safe Harbor Statement
This press release contains forward-looking statements as
defined in the Private Securities Litigation Reform Act of 1995
about matters such as the Company's settlement agreements which are
contingent upon court approval. These statements are based on
management's current expectations and actual results may differ
materially as a result of various risks and uncertainties. Other
factors that could cause actual results to differ from those
reflected in the forward-looking statements are set forth in the
Company's prior press releases and periodic public filings with the
Securities and Exchange Commission, which are available via
Rentech's web site at www.rentechinc.com. The forward-looking
statements in this press release are made as of the date of this
press release and Rentech does not undertake to revise or update
these forward-looking statements, except to the extent that it is
required to do so under applicable law.
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