Alto Ingredients, Inc. 10-K

Item 5. Market For Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market Information Our common stock trades on The Nasdaq Capital Market under the symbol “ALTO”. We also have non-voting common stock outstanding, which is convertible into our voting common stock, and which is not listed on an exchange. Security Holders As of March 13, 2023, we had 75,144,522 shares of common stock outstanding held of record by approximately 320 stockholders and 896 shares of non-voting common stock outstanding held of record by one stockholder. These holders of record include depositories that hold shares of stock for brokerage firms which, in turn, hold shares of stock for numerous beneficial owners. On March 13, 2023, the closing sales price of our common stock on The Nasdaq Capital Market was $1.865 per share. Performance Graph The graph below shows a comparison of the cumulative total stockholder return on our common stock with the cumulative total return on The Nasdaq Composite Index and The Nasdaq Clean Edge Green Energy Index, or Peer Group, in each case over the five-year period ended December 31, 2022. The graph assumes $100 invested at the indicated starting date in our common stock and in each of The Nasdaq Composite Index and the Peer Group, with the reinvestment of all dividends. We have not paid or declared any cash dividends on our common stock and do not anticipate paying any cash dividends on our common stock in the foreseeable future. Stockholder returns over the indicated periods should not be considered indicative of future stock prices or stockholder returns. This graph assumes that the value of the investment in our common stock and each of the comparison groups was $100 on December 31, 2017. - 23 - 12/17 12/18 12/19 12/20 12/21 12/22 Alto Ingredients, Inc. 100.00 18.92 14.29 119.34 105.71 63.30 Nasdaq Composite 100.00 97.16 132.81 192.47 235.15 158.65 Nasdaq Clean Edge Green Energy 100.00 87.89 125.39 357.14 347.70 242.88 Dividend Policy We have never paid cash dividends on our common stock and do not intend to pay cash dividends on our common stock in the foreseeable future. We anticipate that we will retain any earnings for use in the continued development of our business. - 24 - Our current and future debt financing arrangements may limit or prevent cash distributions from our subsidiaries to us, depending upon the achievement of specified financial and other operating conditions and our ability to properly service our debt, thereby limiting or preventing us from paying cash dividends. Further, the holders of our outstanding Series B Preferred Stock are entitled to dividends of 7% per annum, payable quarterly in arrears. Accrued and unpaid dividends in respect of our Series B Preferred Stock must be paid prior to the payment of any dividends in respect of shares of our common stock. For 2020, we accrued but did not declare or pay cash dividends under an agreement with the holders of our Series B Preferred Stock in an effort to preserve liquidity. For 2022, we declared and paid cash dividends on our outstanding shares of Series B Preferred Stock as they became due and, in addition, in 2021, we paid in cash all accrued and unpaid dividends for 2021 and 2020 in respect of our Series B Preferred Stock. Recent Sales of Unregistered Securities On November 7, 2022, we entered into a credit agreement with certain funds managed by Orion Infrastructure Capital to borrow up to $125,000,000. In connection with that transaction, we committed to issue to the lenders pro rata an aggregate of 1,282,051 shares of our common stock at the initial funding and up to an additional 320,513 shares of our common stock based upon certain further fundings under the credit facility. On November 23, 2022, we received our initial funding of $60,000,000 under the credit facility and issued an aggregate of 1,282,051 shares of our common stock to the lenders. We received no separate consideration for the shares of common stock issued. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Orion Term Loan.” Exemption from the registration requirements of the Securities Act for the transaction described above is claimed under Section 4(a)(2) of the Securities Act and Rule 506 of Regulation D as promulgated by the Securities and Exchange Commission under the Securities Act. Purchases of Equity Securities by the Issuer and Affiliated Purchasers The following table sets forth information about repurchases of our common stock for the three months ended December 31, 2022: Period Total number of shares purchased (1) Average price paid per share Total number of shares purchased as part of publicly- announced plans or programs (2) Approximate dollar value of shares that may yet be purchased under plans or programs (2)(3) October 1 to October 31, 2022 — $ — — $ — November 1 to November 30, 2022 92,000 $ 3.51 92,000 $ 48,675,000 December 1 to December 31, 2022 — $ — — $ — Three months ended December 31, 2022 92,000 $ 3.51 92,000 $ 48,675,000 (1) We repurchased 92,000 shares as part of our publicly announced share repurchase program during the three months ended December 31, 2022 and received no shares transferred from employees in satisfaction of minimum statutory tax withholding obligations upon the vesting of restricted stock during the period. (2) On September 12, 2022, we announced a share repurchase program under which we may repurchase up to $50 million of our common stock with an initial purchase authorization of $10 million. Our lenders have further limited our purchase authorization to $5 million. Amounts in excess of our lenders’ initial purchase authorization of $5 million will require additional lender consent and amounts in excess of the initial purchase authorization of $10 million will require additional board and preferred stockholder authorization. The share repurchase program does not have an expiration date, does not require the repurchase of any particular amount of shares, and may be implemented, modified, suspended or discontinued in whole or in part at any time and without further notice. (3) Amount represents the share repurchase program size of $50 million less approximately $1.3 million in aggregate share repurchases, but is subject to authorizations for purchases in excess of our lenders’ purchase authorization of $5 million and our board and preferred stockholders’ initial purchase authorization of $10 million. Item 6. [Reserved] Not Applicable. - 25 -