Item
2.04 Triggering Events That Accelerate or Increase a Direct Financial Obligation
or an Obligation udder an Off-Balance Sheet Arrangement.
On
October 21, 2009, NutraCea received a letter from Wells Fargo Bank, N.A. (“Wells
Fargo”) stating that NutraCea (i) has failed to obtain lien releases, a
dismissal of a complaint and permits necessary to obtain certificates of
occupancy for real property located at 4502 West Monterosa, Phoenix, (ii) failed
to pay rent to the landlord at its corporate offices resulting in the landlord
declaring an event of default on its lease, and (iii) failed to deliver to Wells
Fargo quarterly financial statements for the period ending June 30,
2009. These events constitute an “Event of Default” under the Credit
and Security Agreement, dated as of December 18, 2008 between NutraCea and Wells
Fargo, as amended by the Forebearance Agreement and Amendment to Credit and
Security Agreement, dated July 31, 2009 (the “Agreement”). Based on
these “Events of Default”, Wells Fargo has accelerated the entire principal
balance due under the Agreement. NutraCea owes approximately $3.6
millon under the Agreement, which includes principal, interest and
fees. Wells Fargo may exercise its right to setoff against NutraCea’s
demand deposit account it has with Wells Fargo in order to partially satisfy the
amounts due under the Agreement. The Agreement is secured against
property owned by NutraCea located at 4502 W. Monterosa Street, Phoenix, Arizona
and 3512 E. Bench Street, Dillon, Montana.
SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
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NUTRACEA
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Date:
October 22, 2009
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By:
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/s/
James C. Lintzenich
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James
C. Lintzenich
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Interim
Chief Executive Officer
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(Duly
Authorized Officer)
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