Skip to main content

Policy for Recoupment of Incentive Compensation

(March 25, 2011)

This Policy for Recoupment of Incentive Compensation of Pacific Ethanol, Inc. (the “Company”) will be implemented in accordance with the rules of the Securities and Exchange Commission (“SEC”) and The NASDAQ Stock Market (“NASDAQ”). Unless the rules of the SEC and NASDAQ dictate otherwise, this policy shall apply to any incentive-based compensation awarded or paid after January 1, 2011. The Compensation Committee of the Board of Directors (the “Board”) of the Company (the “Compensation Committee”) will administer this policy and exercise its discretion and business judgment in the fair application of this policy based on the facts and circumstances as it deems relevant in its sole discretion.

If the Company’s financial statements are required to be restated due to material noncompliance with any financial reporting requirements under the federal securities laws (other than a restatement due to a change in accounting rules), the Compensation Committee shall, on behalf of the Company and to the extent legally possible, recover any incentive-based compensation awarded or paid to any current or former executive officer of the Company (each, an “Executive Officer”) during the Recovery Period (as defined below) in excess of what would have been awarded or paid to such Executive Officer under the restatement if:

  • as a result of the restatement, a performance measure which was a material factor in determining the incentive-based compensation received by the Executive Officer award is restated; and
  • in the discretion of the Compensation Committee, a lower payment would have been made to the Executive Officer based upon the Company’s restated financial results.

The “Recovery Period” shall be the three (3) year period preceding the date on which the Board, a committee of the Board or the officer or officers of the Company authorized to take such action if Board action is not required, concludes that a restatement of the Company’s financial statements is required.