THE CORPORATE LIBRARY

Related Party Transactions and Outside Related Director Information

Rentech, Inc. (RTK)

3/15/2006 Proxy Information

During fiscal year 2003, in exchange for loans made to us by C. David Callaham, a shareholder, we issued three convertible promissory notes to him. The notes were issued in the principal amounts of $200,000, $750,000 and $615,000. Interest was due on two of the notes at the rate of nine percent per year and at the rate of ten percent per year on the third note. During fiscal 2003, the $750,000 note was converted into 1,681,878 shares of our common stock. During fiscal 2004, the $200,000 note was converted into 484,444 shares of our common stock. During fiscal 2005, we paid interest on the remaining note to Mr. Callaham in the total amount of $61,500. The remaining balance due on the note is $615,000 as of September 30, 2005. The note could now be converted into 1,366,667 shares of our stock. During fiscal year 2005, in exchange for loans made to us by C. David Callaham, we issued two promissory notes to him. The notes were issued in the principal amounts of $500,000 each. Interest was due on the notes at the rate of eight and a half percent per year. During fiscal 2005, the notes became convertible as a result of a default provision in the notes. During fiscal 2005, we accrued $67,301 in interest on the two notes. The balance due on the notes was $1,067,301 as of September 30, 2005. During fiscal year 2006, we issued 493,332 shares of our common stock to him upon conversion of the principal balance and accrued interest of the two notes.

On August 5, 2005, Rentech entered into a Management Consulting Agreement with Management Resource Center, Inc., a California corporation ("MRC"), an entity to which D. Hunt Ramsbottom was a partner and the principal on the account. Pursuant to the terms of the agreement, Mr. Ramsbottom would assist Rentech in the following courses of action; to develop a strategy to reorganize senior management; to provide support within transactional activities regarding the capturing of commercial opportunities available from the Rentech Process; to assist with the process of seeking capital for the execution of Rentech's business development plan; and to augment Rentech's strategy for enhancing shareholder value. The agreement was dated July 29, 2005 and has a term of six months after which Rentech may extend the agreement on a monthly basis for up to an additional three months. Pursuant to the terms of the agreement, Mr. Ramsbottom exercised his right to assign the agreement to East Cliff Advisors, LLC, an entity controlled by Mr. Ramsbottom. Such assignment was effective August 3, 2005. Accordingly, Mr. Ramsbottom has received a fee of $20,000 per month plus expenses for his services and $5,000 per month plus expenses for such other members of his team as will be necessary to fulfill the engagement. In addition, as consideration for services to be provided, East Cliff was issued a warrant to purchase 3.5 million shares of Rentech's common stock at an exercise price of $1.82. The warrant will vest or has vested in the following incremental amounts upon such time as Rentech's stock reaches the stated closing prices for 12 consecutive trading days; 10% at $2.10 (vested); 15% at $2.75 (vested); 20% at $3.50 (vested); 25% at $4.25 (vested); and 30% at $5.25. The above-referenced stock prices must be achieved at any time prior to 24 months after the start date of a new, full-time, Chief Executive Officer.

On September 30, 2005, Rentech entered into agreements with Dennis L. Yakobson and Ronald Butz on terms of their retirement packages.

Mr. Yakobson's retirement package provided that in return for Mr. Yakobson's retirement no later than December 31, 2005 or at such earlier time as is determined by Hunt Ramsbottom, Rentech would provide the following retirement package: (1) Rentech would pay severance to Mr. Yakobson of $265,543 for each of the years 2006 and 2007. Rentech would pay Mr. Yakobson six months severance on his last day of employment; monthly payments will commence in the seventh month after retirement; (2) Rentech would pay Mr. Yakobson $250,000 in lieu of certain benefits and bonus opportunities that would have accrued under his employment agreement, in cash, or at his election, against the exercise price of stock options; (3) Mr. Yakobson's $80,517 of convertible promissory notes are to be amended to extend the term (to September 30, 2008), and reduce the interest rate (to the prime rate published by the Wall Street Journal); (4) Rentech would pay Mr. Yakobson his unfunded deferred compensation in the amount of $196,358, in cash or, at his election, against the exercise price of stock options; (5) Mr. Yakobson would enter into a consulting agreement with Rentech providing for a monthly fee of $10,000, for a term of one year, commencing on the day after his last date of employment; and (5) Rentech would grant Mr. Yakobson stock options with a two year term and an exercise price of $2.53 per share for 115,000 shares under the Company's 2005 Stock Option Plan, and has granted an identical option for 455,000 shares under the Company's 2006 Incentive Award Plan, subject to approval of the plan by the shareholders.

Mr. Butz' retirement package provided that in return for Mr. Butz' retirement no later than December 31, 2005 or at such earlier time as is determined by Hunt Ramsbottom, Rentech would provide the following retirement package: (1) Rentech would pay severance to Mr. Butz of $235,368 for each of the years 2006 and 2007; (2) Rentech would pay Mr. Butz six months of severance on his last day of employment; monthly payments will commence in the seventh month after retirement; (3) Rentech would pay Mr. Butz $190,000 in lieu of certain benefits and bonus opportunities that would have accrued under his employment agreement, in cash, or at his election, against the exercise price of stock options; (4) Mr. Butz' $46,745.35 of convertible promissory notes are to be amended to extend the term (to September 30, 2008), and reduce the interest rate (to the prime rate published by the Wall Street Journal); (5) Rentech would pay Mr. Butz his unfunded deferred compensation in the amount of $130,149.44, in cash or, at his election, against the exercise price of stock options; and (6) Rentech would grant Mr. Butz stock options with a two year term and an exercise price of $2.53 per share for 75,000 shares under the Company's 2005 Stock Option Plan, and has granted an identical option for 320,000 shares under the Company's 2006 Incentive Award Plan, subject to approval of the plan by the shareholders.

On April 8, 2005, Rentech entered into a Securities Purchase Agreement with M.A.G. Capital, LLC through its designated funds Monarch Pointe Fund, Ltd, Mercator Momentum Fund, III, LP, and Mercator Momentum Fund, LP, and with Pentagon Special Purpose Fund, Ltd. We sold a total of 90,000 shares of our Series A preferred stock at a price of $100 per share. The preferred stock is convertible into shares of our common stock at 80 percent of the volume weighted average price per share for the five trading days preceding any conversion, but not at more than $1.3852 or less than $0.80 per share. We also issued warrants for the purchase of an aggregate of 5,921,910 shares of common stock. The warrants may be exercised at a price of $1.61 per share for a term of three years, expiring April 8, 2008. As of December 1, 2005, Rentech paid dividends on the Series A preferred stock in the amount of $341,475 and as of December 15, 2005, all shares of our Series A preferred stock had been converted into shares of common stock and all warrants remain outstanding.

On November 15, 2005, Rentech and its wholly-owned subsidiary, Rentech Development Corporation ("RDC"), entered into a Commitment Letter with M.A.G. Capital, LLC and Pentagon Bernini Fund, Ltd. (the "Investors"), for the purchase by the Investors of $35 million of 14% secured convertible debentures. The funding is subject to certain conditions including the completion of diligence, execution of definitive documents, the absence of material adverse changes and the concurrent acquisition of Royster-Clark Nitrogen, Inc. ("RCN"), among other things. If the funding has not closed by April 1, 2006, the Commitment Letter and its commitments therein terminate unless otherwise extended by both parties. In the event we determine to go forward with the financing set forth in the Commitment Letter, the funding proceeds will be used to partially finance the $50 million purchase of 100% of the outstanding shares of RCN. The securities proposed to be offered to the Investors have not been registered under the Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.

On September 22, 2005, Rentech entered into a Securities Purchase Agreement with Wellington Management Capital, LLP as investment advisor on behalf of purchasers listed in the Securities Purchase Agreement. The purchasers agreed to buy 13,436,000 shares of the Company's common stock at a price of $2.30 per share for an aggregate purchase price of $30,902,800. The transaction closed on September 30, 2005.

On May 20, 2005, Rentech entered into agreements with Michael F. Ray and David P. Zimel, directors of the Company (Mr. Zimel departed from the Board of Directors effective January 24, 2006), whereby two convertible promissory notes were issued, one in the principal amount of $125,000 to Mr. Ray, and one in the principal amount of $875,000 to Mr. Zimel. The notes bear annual interest at the prime rate published in the Wall Street Journal plus two percentage points. The principal balance of the notes are convertible, at the election of the holders, into shares of common stock, at an amended exercise price of $1.52. As of December 1, 2005, Rentech paid Mr. Ray $5,573 in interest on the note and Mr. Zimel $39,011. In addition, Mr. Ray received a warrant to purchase 82,248 shares of Rentech's common stock at an exercise price of $1.61 and Mr. Zimel received a warrant to purchase 575,733 shares of Rentech's common stock at an exercise price of $1.61. The warrants have a term of three years.

Michael F. Ray, one of Rentech's directors, is a principal in Thiosolv, LLC which provides consulting work to Rentech. During fiscal 2005, Thiosolv, LLC performed services for which it was compensated by Rentech in the amount of $44,213.