Item 1.01 Entry into a Material Definitive Agreement

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.

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