Attached files
| file | filename |
|---|---|
| 8-K - PACIFIC ETHANOL, INC. - Alto Ingredients, Inc. | paceth_8k-030410.htm |
| EX-99.1 - PURCHASE AND OPTION AGREEMENT - LYLES UNITED, LLC AND SOCIUS CG II, LTD. - Alto Ingredients, Inc. | paceth_8k-ex9901.htm |
| EX-99.2 - OPTION/PURCHASE AGREEMENT - LYLES MECHANICAL CO. AND SOCIUS CG II, LTD. - Alto Ingredients, Inc. | paceth_8k-ex9902.htm |
EXHIBIT 10.1
SUPERIOR
COURT OF THE STATE OF CALIFORNIA
FOR THE
COUNTY OF LOS ANGELES, CENTRAL DISTRICT
|
Socius CG
II, Ltd.,
Plaintiff
|
Case No. BC432829
Assigned For All Purposes To:
|
| Hon. Edward A. Ferns, Dept. 69 | |
| v. | |
|
Pacific
Ethanol, Inc. and Does 1-10 Inclusive,
Defendents.
|
ORDER APPROVING
STIPULATION
FOR SETTLEMENT OF
CLAIM
Date: March 4, 2010
Time: 8:30 a.m.
Dept.: 69
|
|
Complaint Filed March 3,
2010
Trial
Date:
None Set
|
The Joint
Ex Parte Application For Court Order Approving Stipulation for Settlement of
Claim ("Application"), filed by Plaintiff Socius CG II, Ltd. ("Socius") and
joined by Defendant Pacific Ethanol, Inc. ( "PEI" or the "Company"), came on for
hearing on March 4, 2010 at 8:30 a.m. in Department 69 of the above-entitled
court, the Honorable Edward A. Ferns, Judge presiding.
The
Court, having reviewed the Application, having been presented with a Stipulation
for Settlement of Claim (the "Stipulation"), a copy of which is attached as
Exhibit A to the Application, and after a hearing
upon the fairness, adequacy and reasonableness of the terms and conditions of
the issuance of shares of the common stock of PEI (the "Common Stock") to
Socius in exchange for the extinguishment of said claims,
IT IS THEREFORE
ORDERED AS FOLLOWS:
1
ORDER APPROVING SETTLEMENT OF CLAIM
1. The
Stipulation is approved in it entirety;
2. In full
and final settlement of Socius' claim against PEI in the total amount of
$5,000,000 (the "Claim"), which Claim Socius purchased from a creditor of PEI,
Lyles United, LLC ("Lyles United") pursuant to a Purchase and Option Agreement
between Socius and Lyles United, dated March 2, 2010 (the "Purchase Agreement"),
and which Claim comprises a portion of the principal amount due and payable
under a loan made from Lyles United to PEI in aggregate principal amount of
$30,000,000, PEI will issue and deliver to Socius or its designee 5,800,000
shares of Common Stock, being approximately equal to (but under no circumstance
whatsoever more than) 9.99% of the total number of shares of Common Stock
outstanding on the date of this stipulation (the "Settlement Shares"), subject
to adjustment as set forth in paragraph 4 below to reflect the intention of the
parties that the total number of shares issued be based upon an average trading
price of the Common Stock for a specified period of time subsequent to entry of
this Order.
3. No later
than the first business day following the date that the Court enters this Order
approving
the Stipulation, PEI shall: (i) immediately issue the number of shares of Common
Stock required by paragraph 2 above to Socius' or its designee's balance account
with The Depository Trust Company (DTC) through the Fast Automated Securities
Transfer (FAST) Program of DTC's Deposit/Withdrawal Agent Commission (DWAC)
system, without any restriction on transfer, time being of the essence, by
transmitting by facsimile and overnight delivery such irrevocable and
unconditional instruction to PEI's stock transfer agent, and (ii) cause its
legal counsel to issue an opinion to PEI's transfer agent, in form and substance
acceptable to both parties and such transfer agent, that the shares may be so
issued.
4. The total
number of shares of Common Stock to be issued to Socius or its designee in
connection
with the Stipulation and this Order shall be adjusted on the 6th trading day
following the date on which the Settlement Shares are delivered to Socius or its
designee as DWAC shares in compliance with paragraph 3 above, as follows: (i) if
the number of VWAP Shares (as defined below) exceeds the number of Settlement
Shares initially issued, then PEI will issue and deliver to Socius or
its
designee, as DWAC shares in accordance with paragraph 3 above, additional shares
of Common Stock equal to the difference between the number of VWAP Shares and
the number of Settlement Shares, and (ii) if the number of VWAP Shares is less
than the number of Settlement Shares, then Socius or its designee will return to
PEI for cancellation that number of shares as equals the difference between the
number of VWAP Shares and the number of Settlement Shares issued pursuant to
paragraph 2 above.
2
ORDER APPROVING SETTLEMENT OF CLAIM
a. The
number of VWAP Shares is equal to (i) $5,000,000 plus Socius' reasonable
legal
fees, expenses, and costs, (ii) divided by 80% of the volume weighted average
price ("VWAP") of the Common Stock over the 5-day trading period immediately
following the date on which the Settlement Shares are delivered to Socius or its
designee as DWAC shares in compliance with paragraph 3 above.
b. In no
event shall the number of shares of Common Stock issued to Socius or its
designee
in connection with the settlement of the Claim, aggregated with all shares of
Common Stock then owned or beneficially owned or controlled by, collectively,
Socius and its affiliates, at any time exceed (i) 9.99% of the total number of
shares of Common Stock then outstanding, or (ii) without the prior written
consent of PEI, that number of shares of Common Stock that would trigger a new
limitation under IRS Code Section 382.
c. In no
event shall the aggregate number of shares of Common Stock issued to
Socius or
its designee in connection with the settlement of the Claim, aggregated with any
other shares of Common Stock issued to Socius and/or its designees by PEI, at
any time exceed 19.99% of the total number of shares of Common Stock outstanding
immediately preceding the date the Court enters the Order approving this
stipulation unless PEI has obtained either (i) stockholder approval for the
issuance of more than such number of shares of Common Stock pursuant to NASDAQ
Marketplace Rule 5635(d) or (ii) a waiver from NASDAQ of compliance with Rule
5635(d).
3
ORDER APPROVING SETTLEMENT OF CLAIM
5. For so long
as Socius or any of its affiliates hold any shares of Common Stock of PEI,
neither
Socius nor any of its affiliates will: (i) vote any shares of Common Stock owned
or controlled by it, or
solicit any proxies or seek to advise or influence any person with respect to
any voting securities
of PEI; or (ii) engage or participate in any actions, plans or proposals which
relate to or would
result in (a) Socius or any of its affiliates acquiring additional securities of
PEI, alone or together with any other person, which would result in Socius and
its affiliates collectively beneficially owning or controlling more than 9.99%
of the total outstanding Common Stock or other voting securities of PEI, (b) an
extraordinary corporate transaction, such as a merger, reorganization or
liquidation, involving PEI or any of its subsidiaries, (c) a sale or transfer of
a material amount of assets of PEI or any of its subsidiaries, (d) any change in
the present board of directors or management of PEI, including any plans or
proposals to change the number or term of directors or to fill any existing
vacancies on the board, (e) any material change in the present capitalization or
dividend policy of PEI, (f) any other material change in PEI's business or
corporate structure, including but not limited to, if PEI is a registered
closed-end investment company, any plans or proposals to make any changes in its
investment policy for which a vote is required by Section 13 of the Investment
Company Act of 1940, (g) changes in PEI's charter, bylaws or instruments
corresponding thereto or other actions which may impede the acquisition of
control of PEI by any Person, (h) causing a class of securities of PEI to be
delisted from a national securities exchange or to cease to be authorized to be
quoted in an inter-dealer quotation system of a registered national securities
association, (i) causing a class of equity securities of PEI to become eligible
for termination of registration pursuant to Section 12(g)(4) of the Act, or (j)
taking any action, intention, plan or arrangement similar to any of those
enumerated above. The provisions of this paragraph 5 may not be modified or
waived without further order of the Court.
4
ORDER APPROVING SETTLEMENT OF CLAIM
6. For the
period of one year from the date that the final number of Settlement Shares are
delivered
to Socius or its designee as DWAC shares in compliance with paragraph 3 above,
and regardless of whether Socius or its affiliates then hold any debt or equity
securities of PEI, Socius and its affiliates shall have the exclusive right to
enter into transactions with PEI whereby PEI directly or indirectly issues
common stock or common stock equivalents to a party (including without
limitation Lyles United or its affiliates) in exchange for outstanding
securities, claims or property interests, or partly in such exchange and partly
for cash, including without limitation any such financing or transaction carried
out pursuant to Section 3(a)(9) or Section 3(a)(10) of the Securities Act of
1933, as amended; provided, however,
that the foregoing exclusivity provision shall not apply to (i) such
transactions
between PEI and any entity that is a creditor of any PEI subsidiary on the date
hereof, or (ii) a convertible note financing (including later conversion of the
notes to common stock) in a maximum amount of $5 million with the creditor with
whom PEI is currently in negotiations regarding such financing, or (iii) such
transactions between PEI and two of its directors in respect of an aggregate of
$2 million in principal amount of notes issued by PEI to such directors provided
that the securities issued in exchange for such notes cannot be sold by such
directors for at least six months subsequent to the issuance date.
2.This
Order ends, finally and forever (i) any claims to payment or compensation of any
kind or
nature which Socius had, now has, or may assert in the future against PEI
arising out of the Claim, and (ii) any claims, including without limitation for
offset or counterclaim, which PEI had, now has, or may assert in the future
against Socius arising out of the Claim. In this regard, and subject to
compliance with this Order, effective upon the execution of this Order, each
party hereby releases and forever discharges the other party, including all of
the other party's employees, officers, directors, affiliates and attorneys, from
any and all claims, demands, obligations (fiduciary or otherwise), and causes of
action, whether known or unknown, suspected or unsuspected, arising out of,
connected with, or incidental to the Claim.
7. This
action is hereby dismissed with prejudice, provided that the court shall retain
jurisdiction
with regard to the Claim to enforce the terms of this Order.
8. The Stipulation and this Order may be
enforced by any party to the Stipulation by a motion
under California Code of Civil Procedure section 664.6, or by any procedure
permitted by law in the Superior Court of Los Angeles County. Pursuant to the
Stipulation, each party thereto further waives a statement of decision, and the
right to appeal from this Order after entry. Except as expressly provided in
Paragraph 4 above, each party shall bear its own attorney's fees, expenses and
costs with regard to the Stipulation and this Order.
IT
IS SO ORDERED.
| DATED: MAR 4, 2010 | /s/ Edward A. Ferns |
| JUDGE OF THE SUPERIOR COURT | |
5
ORDER APPROVING SETTLEMENT OF CLAIM