PHOENIX— NutraCea (OTCBB: NTRZ) is getting its financial house in order, filing a plan of reorganization to exist Chapter 11 bankruptcy protection and reaching a preliminary settlement of class action security charges.
On June 10, the company announced preliminary approval by the U.S. District Court, District of Arizona, of the settlement of a securities class action lawsuit that was pending against NutraCea and certain of its former officers and directors; the claims were also filed in the U.S. Bankruptcy Court, which must also approve the settlement. A hearing set for Oct. 1 in District Court should finalize the settlement, and W. John Short, NutraCea’s CEO and chairman, said the company is “optimistic” the charges will be fully resolved at that hearing. Under terms of the settlement, anyone who purchased NutraCea shares between April 2, 2007 and February 23, 2009 may be entitled to a share of the proceeds.
Two weeks later, on June 24, NutraCea and its Official Committee of Unsecured Creditors filed the proposed plan of bankruptcy reorganization and the related disclosure statement with the U.S. Bankruptcy Court in Phoenix. NutraCea originally filed for Chapter 11 protection in November 2009, although none of its subsidiaries were included in the filing. Short commented, “We look forward to Plan confirmation and our emergence from Chapter 11 later this year as a stronger more focused company.”
NutraCea holds several patents related to stabilized rice bran (SRB) production technology and proprietary products derived from SRB. In the past several months, the company has sold off certain subsidiaries including its cereal business (to Kerry Inc.) and equine portfolio (to Manna Pro Products) to focus on its core operation.
