Hong Yuan Holding Group (HGYN)

[Renee]

Cereplast must approve the increase in the Authorized Shares to 2 billion and the company must also approve the reverse split.

Cereplast chose NOT to approve the last proposed reverse split to remain on the Nasdaq because the company desperately needed to access Accredited Investor money that they could not obtain while on the Nasdaq.

Cereplast voluntarily delisted from the Nasdaq to the OTC in order to urgently obtain Accredited Investor money to satisfy their default to Wells Fargo. The Wells Fargo default could have forced Cereplast into a dire situation, so the company really had no choice but to expedite the delisting from the Nasdaq by voluntarily delisting themselves.

As a Nasdaq listed company Cereplast could NOT access quick money. As an example the S-1 registration to Ironridge will take about two months to become effective, whereas Accredited Investor money can happen the instant the ink is dry.

Magna, Hanover, and ASHER have been selling shares by the mega millions and they will continue to do so because they are allowed to do so on the OTC. That was the sole reason for Cereplast to voluntarily delist from the Nasdaq.....self preservation by accessing immediate money for the Accredited Investors to pay off the Wells Fargo default.

Below are excerpts of Cereplast's 8 K's to demonstrate the dire situation Cereplast was and is in, thus requiring the necessity to raise the A/S to 2 billion and vote on a reverse split.


CERP 8K filed Jan. 21st, 2013: Effective January 18, 2013, Cereplast, Inc. (the “Company”) entered into a payment agreement dated January 15, 2013 with Magna Group, LLC (“Magna”) and the holders of the Company’s 7% Convertible Senior Subordinated Notes (the “Notes”) issued by the Company in the aggregate principal face amount of $12,500,000 pursuant to the Indenture dated as of May 24, 2011 (the “Indenture”) to provide for payment of interest on the Notes which was due on June 1, 2012 and December 1, 2012. The payment agreement also provides for payment of interest which will be due on June 1, 2013. Payments in the agreement will be made by Magna to the Holders in tranches. In connection with the execution of the payment agreement, the holders waived the event of default and agreed to forbear from exercising their rights and remedies under the Indenture with respect to the Company’s failure to make interest payments that were due on June 1, 2012 and December 1, 2012.

http://yahoo.brand.edgar-online.com/displayfilinginfo.aspx?FilingID=9026127-852-5238&type=sect&dcn=0001193125-13-018291

The Jan. 21, 2013 8K was an action related to the Jan. 9, 2013 8K:

Item 2.04 Triggering Events that Accelerate or Increase a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement Entry into a Material Definitive Agreement

On January 3, 2013, Cereplast, Inc. (the “Company”) received a Notice of Event of Default (the “Notice”) from Wells Fargo Bank, National Association, the Trustee under the Indenture (the “Indenture”) dated as of May 24, 2011by and among the Company and the Trustee, with respect to the Company’s 7% Convertible Senior Subordinated Notes (the “Notes”). The Notice was triggered by the failure of the Company to pay on December 1, 2012 pursuant to the terms of the Forbearance Agreements dated as of May 31, 2012 entered into with the holders of the Notes, interest in the amount of $332,500 that was due on June 1, 2012 and interest in the amount of $332,500 due on December 1, 2012. The Notes in the aggregate amount of $12,500,000 were originally issued pursuant to the Indenture on May 24, 2011. As of the date of this current report an aggregate amount of $10,000,000 of the Notes remain outstanding.

http://yahoo.brand.edgar-online.com/displayfilinginfo.aspx?FilingID=9012099-852-5342&type=sect&dcn=0001193125-13-008273