NEITHER THESE SECURITIES NOR THE SECURITIES FOR WHICH THESE
SECURITIES ARE EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES
AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE
IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A
TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES
LAWS.
PACIFIC ETHANOL, INC.
WARRANT
|
Warrant No. W7-___
|
Dated: May ___, 2008
|
Pacific
Ethanol, Inc., a Delaware corporation (the “ Company ”),
hereby certifies that, for value received, _______________ or
his registered assigns (the “ Holder ”),
is entitled to purchase from the Company up to a total of
__________ shares of common stock, $.001 par value per share
(the “ Common Stock
”), of the Company (each such share, a “
Warrant
Share ” and all such shares, the “
Warrant
Shares ”) at an exercise price equal to $7.00 per
share (as adjusted from time to time as provided in
Section 8
, the “ Exercise Price
”), subject to the terms and conditions contained
herein. This Warrant (this “ Warrant ”)
is issued in connection with the purchase by _______________
of shares of the Company’s Series B Cumulative
Convertible Preferred Stock (the “Series B Preferred
Stock” ) pursuant to the terms and conditions of
that certain Securities Purchase Agreement dated May ___,
2008 between the Company and _______________ (the “Purchase
Agreement” ). Capitalized terms not
otherwise defined herein shall have their respective meanings
as set forth in the Purchase Agreement.
1.
Registration of Warrant . The Company shall
register this Warrant, upon records to be maintained by the Company
for that purpose (the “ Warrant Register
”), in the name of the record Holder hereof from time to
time. The Company may deem and treat the registered
Holder of this Warrant as the absolute owner hereof for the purpose
of any exercise hereof or any distribution to the Holder, and for
all other purposes, absent actual notice to the
contrary.
2.
Registration of Transfers . The Company shall
register the transfer of any portion of this Warrant in the Warrant
Register, upon surrender of this Warrant, with the Form of
Assignment attached hereto duly completed and signed, to the
Company at its address specified herein. Upon any such
registration or transfer, a new warrant to purchase Common Stock,
in substantially the form of this Warrant (any such new warrant, a
“ New
Warrant ”), evidencing the portion of this Warrant so
transferred shall be issued to the transferee and a New Warrant
evidencing the remaining portion of this Warrant not so
transferred, if any, shall be issued to the transferring
Holder. The acceptance of the New Warrant by the
transferee thereof shall be deemed the acceptance by such
transferee of all of the rights and obligations of a holder of a
Warrant.
3.
Exercise and Duration of Warrants .
(a)
This
Warrant shall be exercisable by the registered Holder from time to
time during the term commencing on the date that is six (6) months
and one (1) day from the date hereof and ending on the date that is
ten (10) years from the date hereof (the “ Expiration Date
”). At 5:00 P.M., California time on the Expiration Date, the
portion of this Warrant not exercised prior thereto shall be and
become void and of no value.
(b)
A
Holder may exercise this Warrant by delivering to the Company (i)
an exercise notice, in the form attached hereto (the “
Exercise
Notice ”), appropriately completed and duly signed,
and (ii) payment of the Exercise Price for the number of
Warrant Shares as to which this Warrant is being exercised, and the
date such items are delivered to the Company (as determined in
accordance with the notice provisions hereof) is an “
Exercise
Date .” The Holder shall not be required to
deliver the original Warrant in order to effect an exercise
hereunder. Execution and delivery of the Exercise Notice
shall have the same effect as cancellation of the original Warrant
and issuance of a New Warrant evidencing the right to purchase the
remaining number of Warrant Shares.
4.
Delivery of Warrant Shares .
(a)
Upon
exercise of this Warrant, the Company shall promptly (but in no
event later than five (5) Business Days after the Exercise Date)
issue or cause to be issued and cause to be delivered to or upon
the written order of the Holder and in such name or names as the
Holder may designate, a certificate for the Warrant Shares issuable
upon such exercise. For purposes of this Warrant,
“ Business
Day ” means any day other than Saturday, Sunday or
other day on which commercial banks in the State of California are
authorized or required by law to remain closed. The
Holder, or any person so designated by the Holder to receive
Warrant Shares, shall be deemed to have become holder of record of
such Warrant Shares as of the Exercise Date. It is
acknowledged and agreed that certificates evidencing such Warrant
Shares may bear a restrictive legend in substantially the following
form:
THESE
SECURITIES HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND
EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE
IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), OR ANY APPLICABLE STATE SECURITIES LAWS AND,
ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR
PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION
NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT AND IN COMPLIANCE WITH APPLICABLE STATE
SECURITIES LAWS OR BLUE SKY LAWS.
(b)
This
Warrant is exercisable, either in its entirety or, from time to
time, for a portion of the number of Warrant
Shares. Upon surrender of this Warrant following one or
more partial exercises, the Company shall issue or cause to be
issued, at its expense, a New Warrant evidencing the right to
purchase the remaining number of Warrant Shares.
5.
Charges, Taxes and Expenses . Issuance and
delivery of certificates for shares of Common Stock upon exercise
of this Warrant shall be made without charge to the Holder for any
issue or transfer tax, transfer agent fee or other incidental tax
or expense in respect of the issuance of such certificates, all of
which taxes and expenses shall be paid by the Company; provided,
however, that the Company shall not be required to pay any tax
which may be payable in respect of any transfer involved in the
registration of any certificates for Warrant Shares or Warrants in
a name other than that of the Holder. The Holder shall
be responsible for all other tax liability that may arise as a
result of holding or transferring this Warrant or receiving Warrant
Shares upon exercise hereof.
6.
Replacement of Warrant . If this Warrant is
mutilated, lost, stolen or destroyed, the Company shall issue or
cause to be issued in exchange and substitution for and upon
cancellation hereof, or in lieu of and substitution for this
Warrant, a New Warrant, but only upon receipt of evidence
reasonably satisfactory to the Company of such loss, theft or
destruction and customary and reasonable bond or indemnity, if
requested. Applicants for a New Warrant under such
circumstances shall also comply with such other reasonable
regulations and procedures and pay such other reasonable
third-party costs as the Company may prescribe.
7.
Reservation of Warrant Shares . The Company
covenants that it will at all times reserve and keep available out
of the aggregate of its authorized but unissued and otherwise
unreserved Common Stock, solely for the purpose of enabling it to
issue Warrant Shares upon exercise of this Warrant as herein
provided, the number of Warrant Shares which are then issuable and
deliverable upon the exercise of this entire Warrant, free from
preemptive rights or any other contingent purchase rights of
persons other than the Holder (after giving effect to the
adjustments and restrictions of Section 8
, if any). The Company covenants that all Warrant Shares so
issuable and deliverable shall, upon the due exercise of this
Warrant, and upon issuance of such Warrant Shares and the payment
of the applicable Exercise Price in accordance with the
terms
