"Under the terms of the Warrants held by the selling security holder, the selling security holder may not exercise the Warrants to the extent (but only to the extent) that the selling security holder or any of its affiliates would, after such exercise, beneficially own more than 7.50% of our outstanding shares of common stock, or Blocker. The Blocker applicable to the exercise of the Warrants may be raised or lowered at the option of the selling security holder to any percentage not in excess of 9.99%, except that any increase will only be effective upon 61-days’ prior notice to us." http://ir.stockpr.com/pacificethanol/sec-filings?page=2#document-28164-0001019687-14-002271
As for the 9%, simply factor it in. Bottom line, at this market cap, even with the additional 4M warrants exercised at the current price and added in, the company is seriously undervalued. I fail to see how being vulnerable to a takeover attempt in this price range is in any way a good thing.
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