BioNitrogen Holdings Corp. (BIONQ)

[TFletcher]

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BioNitrogen Files for Chapter 11 Bankruptcy Protection - By Peg Brickley

Fertilizer company BioNitrogen Holdings Corp. filed for chapter 11 bankruptcy protection Tuesday in Florida, where it has been working toward building plants.

A so-called clean-tech company, BioNitrogen was set up to produce fertilizer out of agricultural waste instead of using subterranean natural gas. The company estimated debt of $3.5 million and assets worth from $1 million to $10 million, in papers filed in the U.S. Bankruptcy Court for the Southern District of Florida.

In October, BioNitrogen was hit with a default judgment in favor of Annon Consulting Inc., a Canadian company that lent it $845,000 at 30% interest in December 2013. The debt to Annon is listed at $1.4 million in BioNitrogen's bankruptcy court papers.

The complaint Annon filed in federal court in Florida says the loan to BioNitrogen wasn't repaid. The suit was filed in January, but BioNitrogen didn't respond until May, when it blamed trouble in its senior executive ranks for the failure to address the litigation.

In court papers, BioNitrogen's lawyers said a member of the board of the directors who resigned in April, former president and chief financial officer Bryan Kornegay Jr., had been responsible for the litigation. Last year, Mr. Kornegay was charged with grand theft in excess of $100,000, but those charges ultimately were dismissed, according to a report BioNitrogen filed with the Securities and Exchange Commission.

However, an internal investigation of Mr. Kornegay's handling of BioNitrogen's securities, investor funds and related transactions led to allegations of misconduct, and Kornegay's resignation, SEC filings say.

Mr. Kornegay couldn't immediately be reached Wednesday.

Write to Peg Brickley at [e-mail]

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(END) Dow Jones Newswires

November 04, 2015 07:37 ET (12:37 GMT)

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