ex10-2.htm


     

      
        

      

    

    Exhibit
10.2

    

      


      


      March 2, 2010

      


      


      STRICTLY
CONFIDENTIAL

      


      Frank C.
Ingriselli

      President
& CEO

      Pacific
Asia Petroleum, Inc.

      250 East
Hartsdale Ave.

      Hartsdale,
NY 10530

      


      Dear Mr.
Ingriselli:

      


      This
letter (the “Agreement”)
constitutes the agreement between Rodman & Renshaw, LLC (“Rodman” or the “Placement Agent”) and
Pacific Asia Petroleum, Inc. (the “Company”), that
Rodman shall serve as the exclusive placement agent for the Company, on a
“reasonable best efforts” basis, in connection with the proposed placement (the
“Placement”)
of  registered securities (the “Securities”) of the
Company, including 4,739,337 shares (the “Shares”) of the
Company’s common stock, par value $0.001 per share (the “Common Stock” at a
price of $4.22 per Share for aggregate gross proceeds to the Company of
approximately $20,000,000, along with common stock purchase warrants (“Series A Warrants”)
to purchase up to, in the aggregate, an additional $8,000,000  of
Common Stock at a price of $4.50 per share and common stock purchase warrants
(“Series B
Warrants,” and together with the Series A Warrants, the “Warrants”) to
purchase up to, in the aggregate, an additional $8,000,000 of Common Stock at a
price of $4.12 per share.  The terms of such Placement and the
Securities shall be mutually agreed upon by the Company and the purchasers
(each, a “Purchaser” and
collectively, the “Purchasers”) and
nothing herein constitutes that Rodman would have the power or authority to bind
the Company or any Purchaser or an obligation for the Company to issue any
Securities or complete the Placement.  This Agreement and the
documents executed and delivered by the Company and the Purchasers in connection
with the Placement shall be collectively referred to herein as the “Transaction Documents.”  The
date of the closing of the Placement shall be referred to herein as the “Closing
Date.”  The Company expressly acknowledges and agrees that
Rodman’s obligations hereunder are on a reasonable best efforts basis only and
that the execution of this Agreement does not constitute a commitment by Rodman
to purchase the Securities and does not ensure the successful placement of the
Securities or any portion thereof or the success of Rodman with respect to
securing any other financing on behalf of the Company.

      


      SECTION
1.                                COMPENSATION AND OTHER
FEES.

      


      As
compensation for the services provided by Rodman hereunder, the Company agrees
to pay to Rodman:

      
         

        
          
            
            

          

          
            
              Rodman & Renshaw, LLC  1251 Avenue of the Americas, 20th
Floor, New York, NY 10020

              Tel: 212 356 0500  Fax: 212 581 5690  www.rodm.com  Member: FINRA, SIPC

            

            
              

            

          

          
            
            

          

        

         

      

      (A)           The
fees set forth below with respect to the Placement:

      


      
        	
                1.
       

              	
                A
      cash fee payable immediately upon the closing of the Placement and equal
      to 6% of the aggregate gross proceeds raised in the
      Placement.  The Placement Agent’s fee shall be paid at the
      closing of the Offering from the gross proceeds of the Securities
      sold.

              


      

      


      
        	
                 
      2.  

              	
                 Such
      number of warrants (the “Rodman
      Warrants”) to Rodman or its designees at the Closing to purchase
      shares of Common Stock equal to 3% of the aggregate number of Shares sold
      in the Placement, plus any Shares underlying any convertible Securities
      sold in the Placement.  The Rodman Warrants shall have the same
      terms as the warrants (if any) issued to the Purchasers in the Placement
      except that the exercise price shall be 125% of the public offering price
      per share and the expiration date shall be five years from the effective
      date of the shelf registration statement referred to in Section 2(A)
      below.  The Rodman Warrants shall not have antidilution
      protections or be transferable for six months from the date of the
      Offering except as permitted by Financial Industry Regulatory Authority
      (“FINRA”)
      Rule 5110(g), and further, the number of Shares underlying the Rodman
      Warrants shall be reduced if necessary to comply with FINRA rules or
      regulations.

              


      

      


      (B)           Subject
to compliance with FINRA Rule 5110(f)(2)(D), the Company also agrees to
reimburse Rodman’s out-of-pocket accountable expenses actually incurred by
Rodman or persons associated with Rodman (with supporting invoices/receipts) up
to a maximum of 0.8% of the aggregate gross proceeds raised in the placement,
but in no event more than $25,000.  Such reimbursement shall be
payable immediately upon (but only in the event of) the closing of the
Placement.

      


      SECTION
2.                                REGISTRATION
STATEMENT.

      


      The
Company represents and warrants to, and agrees with, the Placement Agent
that:

       

      (A)           The
Company has filed with the Securities and Exchange Commission (the “Commission”) a
registration statement on Form S-3 (Registration File No. 333-163269) under the
Securities Act of 1933, as amended (the “Securities Act”),
which became effective on February 3, 2010, for the registration under the
Securities Act of the Shares and Warrants.  At the time of such
filing, the Company met the requirements of Form S-3 under the Securities
Act.  Such registration statement meets the requirements set forth in
Rule 415(a)(1)(x) under the Securities Act and complies with said Rule. The
Company will file with the Commission pursuant to Rule 424(b) under the
Securities Act, and the rules and regulations (the “Rules and
Regulations”) of the Commission promulgated thereunder, a supplement to
the form of prospectus included in such registration statement relating to the
placement of the Shares and Warrants and the plan of distribution thereof and
has advised the Placement Agent of all further information (financial and other)
with respect to the Company required to be set forth therein. Such registration
statement, including the exhibits thereto, as amended at the date of this
Agreement, is hereinafter called the “Registration
Statement”; such prospectus in the form in which it appears in the
Registration Statement is hereinafter called the “Base Prospectus”; and
the supplemented form 

       

       

      
        
          
          

        

        
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      of
prospectus, in the form in which it will be filed with the Commission pursuant
to Rule 424(b) (including the Base Prospectus as so supplemented) is hereinafter
called the “Prospectus
Supplement.” Any reference in this Agreement to the Registration
Statement, the Base Prospectus or the Prospectus Supplement shall be deemed to
refer to and include the documents incorporated by reference therein (the “Incorporated
Documents”) pursuant to Item 12 of Form S-3 which were filed under the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), on or before
the date of this Agreement, or the issue date of the Base Prospectus or the
Prospectus Supplement, as the case may be; and any reference in this Agreement
to the terms “amend,” “amendment” or “supplement” with respect to the
Registration Statement, the Base Prospectus or the Prospectus Supplement shall
be deemed to refer to and include the filing of any document under the Exchange
Act after the date of this Agreement, or the issue date of the Base Prospectus
or the Prospectus Supplement, as the case may be, deemed to be incorporated
therein by reference. All references in this Agreement to financial statements
and schedules and other information that is “contained,” “included,”
“described,” “referenced,” “set forth” or “stated” in the Registration
Statement, the Base Prospectus or the Prospectus Supplement (and all other
references of like import) shall be deemed to mean and include all such
financial statements and schedules and other information that is or is deemed to
be incorporated by reference in the Registration Statement, the Base Prospectus
or the Prospectus Supplement, as the case may be.  No stop order
suspending the effectiveness of the Registration Statement or the use of the
Base Prospectus or the Prospectus Supplement has been issued, and no proceeding
for any such purpose is pending or has been initiated or, to the Company's
knowledge, is threatened by the Commission. For purposes of this Agreement,
“Time of Sale
Prospectus” means the preliminary prospectus used in connection with the
Placement, including any documents incorporated by reference
therein.

       

      (B)           The
Registration Statement (and any further documents to be filed with the
Commission) contains all exhibits and schedules as required by the Securities
Act. Each of the Registration Statement and any post-effective amendment
thereto, at the time it became effective, complied in all material respects with
the Securities Act and the Exchange Act and the applicable Rules and Regulations
and did not and, as amended or supplemented, if applicable, will not, contain
any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading. The Base Prospectus, the Time of Sale Prospectus, if any, and the
Prospectus Supplement, each as of its respective date, comply in all material
respects with the Securities Act and the Exchange Act and the applicable Rules
and Regulations. Each of the Base Prospectus, the Time of Sale Prospectus, if
any, and the Prospectus Supplement, as amended or supplemented, did not and will
not contain as of the date thereof any untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements therein,
in light of the circumstances under which they were made, not misleading. The
Incorporated Documents, when they were filed with the Commission, conformed in
all material respects to the requirements of the Exchange Act and the applicable
Rules and Regulations, and none of such documents, when they were filed with the
Commission, contained any untrue statement of a material fact or omitted to
state a material fact necessary to make the statements therein (with respect to
Incorporated Documents incorporated by reference in the Base Prospectus or
Prospectus Supplement), in light of the circumstances under which they were made
not misleading; and any further documents so filed and incorporated by reference
in the Base 

       

       

      
        
          
          

        

        
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      Prospectus,
the Time of Sale Prospectus, if any, or Prospectus Supplement, when such
documents are filed with the Commission, will conform in all material respects
to the requirements of the Exchange Act and the applicable Rules and
Regulations, as applicable, and will not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading. No post-effective amendment to the Registration Statement reflecting
any facts or events arising after the date thereof which represent, individually
or in the aggregate, a fundamental change in the information set forth therein
is required to be filed with the Commission.  There are no documents
required to be filed with the Commission in connection with the transaction
contemplated hereby that (x) have not been filed as required pursuant to the
Securities Act or (y) will not be filed within the requisite time period. There
are no contracts or other documents required to be described in the Base
Prospectus, the Time of Sale Prospectus, if any, or Prospectus Supplement, or to
be filed as exhibits or schedules to the Registration Statement, that have not
been described or filed as required.

       

      (C)           The
Company has delivered, or will as promptly as practicable deliver, to the
Placement Agent complete conformed copies of the Registration Statement and of
each consent and certificate of experts, as applicable, filed as a part thereof,
and conformed copies of the Registration Statement (without exhibits), the Base
Prospectus, the Time of Sale Prospectus, if any, and the Prospectus Supplement,
as amended or supplemented, in such quantities and at such places as the
Placement Agent reasonably requests.  Neither the Company nor any of
its directors and officers has distributed and none of them will distribute,
prior to the Closing Date, any offering material in connection with the offering
and sale of the Shares and Warrants other than the Base Prospectus, the Time of
Sale Prospectus, if any, the Prospectus Supplement, the Registration Statement,
copies of the documents incorporated by reference therein and any other
materials permitted by the Securities Act.

       

      SECTION
3.                      REPRESENTATIONS AND
WARRANTIES.

       

      (A) There are
no affiliations with any FINRA member firm among the Company’s officers,
directors or, to the knowledge of the Company, any five percent (5%) or greater
stockholder of the Company, except as set forth in the Base
Prospectus.

       

      (B) Except as
otherwise provided in this Agreement, no brokerage or finder’s fees or
commissions are or will be payable by the Company to any broker, financial
advisor or consultant, finder, placement agent, investment banker, bank or other
Person with respect to the transactions contemplated by the Transaction
Documents.

       

      (C) Rodman
shall be entitled to rely upon any and all representations and warranties of the
Company included in the purchase agreements entered into by the Company and the
Purchasers in connection with the Placement, subject to the qualifications and
limitations therein.

       

      SECTION
4.                      ENGAGEMENT
TERM.  Rodman's engagement hereunder will be for the period of
15 days from the date hereof.  The engagement may be terminated by
either the Company or Rodman at any time upon 2 days' written notice.
Notwithstanding anything to the contrary contained herein, the provisions in
this Agreement concerning confidentiality, indemnification and contribution will
survive any expiration or termination of this Agreement.  Upon any
termination of this Agreement, the Company's 

       

       

      
        
          
          

        

        
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      obligation
to pay Rodman any fees actually earned on closing of the Offering and otherwise
payable under Section 1(A), shall survive any expiration or termination of this
Agreement, as permitted by FINRA Rule 5110(f)(2)(d).  Upon any
termination of this Agreement, the Company's obligation to reimburse Rodman for
out of pocket accountable expenses actually incurred by Rodman and reimbursable
upon closing of the Offering pursuant to Section 1(B), if any are otherwise due
under Section 1(B) hereof, will survive any expiration or termination of this
Agreement, as permitted by FINRA Rule 5110(f)(2)(d).

      


      SECTION
5.                      RODMAN
INFORMATION.  The Company agrees that any information or advice
rendered by Rodman in connection with this engagement is for the confidential
use of the Company only in their evaluation of the Placement and, except as
otherwise required by law, the Company will not disclose or otherwise refer to
the advice or information in any manner without Rodman’s prior written
consent.

      


      SECTION
6.                      NO FIDUCIARY
RELATIONSHIP.  This Agreement does not create, and shall not be
construed as creating rights enforceable by any person or entity not a party
hereto, except those entitled hereto by virtue of the indemnification provisions
hereof.  The Company acknowledges and agrees that Rodman is not and
shall not be construed as a fiduciary of the Company and shall have no duties or
liabilities to the equity holders or the creditors of the Company or any other
person by virtue of this Agreement or the retention of Rodman hereunder, all of
which are hereby expressly waived.

      


      SECTION
7.                      CLOSING.   The
obligations of the Placement Agent and the Purchasers, and the closing of the
sale of the Securities hereunder are subject to the accuracy, when made and on
the Closing Date, of the representations and warranties on the part of the
Company and its Subsidiaries contained herein, to the accuracy of the statements
of the Company and its Subsidiaries made in any certificates pursuant to the
provisions hereof, to the performance by the Company and its Subsidiaries of
their obligations hereunder, and to each of the following additional terms and
conditions:

       

      (A)           No
stop order suspending the effectiveness of the Registration Statement shall have
been issued and no proceedings for that purpose shall have been initiated or
threatened by the Commission, and any request for additional information on the
part of the Commission (to be included in the Registration Statement, the Base
Prospectus or the Prospectus Supplement or otherwise) shall have been complied
with to the reasonable satisfaction of the Placement Agent.

      


      (B)           The
Placement Agent shall not have discovered and disclosed to the Company on or
prior to the Closing Date that the Registration Statement, the Base Prospectus
or the Prospectus Supplement or any amendment or supplement thereto contains an
untrue statement of a fact which, in the opinion of counsel for the Placement
Agent, is material or omits to state any fact which, in the opinion of such
counsel, is material and is required to be stated therein or is necessary to
make the statements therein not misleading.

       

      (C)           All
corporate proceedings and other legal matters incident to the authorization,
form, execution, delivery and validity of each of this Agreement, the
Securities, the Registration Statement, the Base Prospectus and the Prospectus
Supplement and all other legal matters relating to this Agreement and the
transactions contemplated hereby shall be reasonably satisfactory in all
material respects to counsel for the Placement Agent, and the Company shall have
furnished to such counsel all documents and information that they may reasonably
request to enable them to pass upon such matters.

       

       

      
        
          
          

        

        
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      (D)           
The Placement Agent shall have received from outside counsel to the Company such
counsel’s written opinion, addressed to the Placement Agent and the Purchasers
dated as of the Closing Date, in form and substance reasonably satisfactory to
the Placement Agent.

       

      


       

      (E)           Neither
the Company nor any of its Subsidiaries shall have sustained since the date of
the latest audited financial statements included or incorporated by reference in
the Base Prospectus, any loss or interference with its business from fire,
explosion, flood, terrorist act or other calamity, whether or not covered by
insurance, or from any labor dispute or court or governmental action, order or
decree, otherwise than as set forth in or contemplated by the Base Prospectus
and (ii) since such date there shall not have been any change in the capital
stock or long-term debt of the Company or any of its Subsidiaries or any change,
or any development involving a prospective change, in or affecting the business,
general affairs, management, financial position, stockholders’ equity, results
of operations or prospects of the Company and its Subsidiaries, otherwise than
as set forth in or contemplated by the Base Prospectus, the effect of which, in
any such case described in clause (i) or (ii), is, in the judgment of the
Placement Agent, so material and adverse as to make it impracticable or
inadvisable to proceed with the sale or delivery of the Securities on the terms
and in the manner contemplated by the Base Prospectus, the Time of Sale
Prospectus, if any, and the Prospectus Supplement.

       

      (F)           The
Common Stock is registered under the Exchange Act and, as of the Closing Date,
the Shares and shares underlying the Warrants shall be listed and admitted and
authorized for trading on the Trading Market, and satisfactory evidence of such
actions shall have been provided to the Placement Agent.  The Company
shall have taken no action designed to, or likely to have the effect of
terminating the registration of the Common Stock under the Exchange Act or
delisting or suspending from trading the Common Stock from the Trading Market,
nor has the Company received any information suggesting that the Commission or
the Trading Market is contemplating terminating such registration or
listing.

       

      (G)           Subsequent
to the execution and delivery of this Agreement, there shall not have occurred
any of the following: (i) trading in securities generally on the New York Stock
Exchange, the Nasdaq National Market or the NYSE Amex or in the over-the-counter
market, or trading in any securities of the Company on any exchange or in the
over-the-counter market, shall have been suspended or minimum or maximum prices
or maximum ranges for prices shall have been established on any such exchange or
such market by the Commission, by such exchange or by any other regulatory body
or governmental authority having jurisdiction, (ii) a banking moratorium shall
have been declared by federal or state authorities or a material disruption has
occurred in commercial banking or securities settlement or clearance services in
the United States, (iii) the United States shall have become engaged in
hostilities in which it is not currently engaged, the subject of an act of
terrorism, there shall have been an escalation in hostilities involving the
United States, or there shall have been a declaration of a national emergency or
war by the United States, or (iv) there shall have occurred any other calamity
or crisis or any change in general economic, political or financial conditions
in the United States or elsewhere, if the effect of any such event in clause
(iii) or (iv) makes it, in the reasonable judgment of the Placement Agent,
impracticable or inadvisable to proceed with the sale or delivery of the
Securities on the terms and in the manner contemplated by the Base Prospectus
and the Prospectus Supplement.

       

       

      
        
          
          

        

        
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      (H)           No
action shall have been taken and no statute, rule, regulation or order shall
have been enacted, adopted or issued by any governmental agency or body which
would, as of the Closing Date, prevent the issuance or sale of the Securities or
materially and adversely affect or potentially and adversely affect the business
or operations of the Company; and no injunction, restraining order or order of
any other nature by any federal or state court of competent jurisdiction shall
have been issued as of the Closing Date which would prevent the issuance or sale
of the Securities or materially and adversely affect or potentially and
adversely affect the business or operations of the Company.

       

      (I)           The
Company shall have prepared and filed with the Commission a Current Report on
Form 8-K with respect to the Placement, including as an exhibit thereto this
Agreement.

       

      (J)           The
Company shall have entered into subscription agreements with each of the
Purchasers and such agreements shall be in full force and effect and shall
contain representations and warranties of the Company as agreed between the
Company and the Purchasers.

       

      (K)           FINRA
shall have raised no objection to the fairness and reasonableness of the terms
and arrangements of this Agreement.  In addition, the Company shall,
if requested by the Placement Agent, make or authorize Placement Agent’s counsel
to make on the Company’s behalf, an Issuer Filing with FINRA pursuant to FINRA
Rule 5110 with respect to the Registration Statement and pay all filing fees
required in connection therewith.

        

      (L)           Prior
to the Closing Date, the Company shall have furnished to the Placement Agent
such further information, certificates and documents as the Placement Agent may
reasonably request

       

      All
opinions, letters, evidence and certificates mentioned above or elsewhere in
this Agreement shall be deemed to be in compliance with the provisions hereof
only if they are in form and substance reasonably satisfactory to counsel for
the Placement Agent.

       

      SECTION 8.       INDEMNIFICATION. (A)  To
the extent permitted by law, the Company will indemnify Rodman and its
affiliates, stockholders, directors, officers, employees and controlling persons
(within the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act) against all losses, claims, damages, expenses and liabilities, as
the same are incurred (including the reasonable fees and expenses of counsel),
relating to or arising out of its activities hereunder or pursuant to this
engagement letter, except to the extent that any losses, claims, damages,
expenses or liabilities (or actions in respect thereof) are found in a final
judgment (not subject to appeal) by a court of law to have resulted primarily
and directly from Rodman’s willful misconduct or gross negligence in performing
the services described herein.

       

       

      
        
          
          

        

        
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      (B)           Promptly
after receipt by Rodman of notice of any claim or the commencement of any action
or proceeding with respect to which Rodman is entitled to indemnity hereunder,
Rodman will notify the Company in writing of such claim or of the commencement
of such action or proceeding, and the Company will assume the defense of such
action or proceeding and will employ counsel reasonably satisfactory to Rodman
and will pay the fees and expenses of such counsel.  Notwithstanding
the preceding sentence, Rodman will be entitled to employ counsel separate from
counsel for the Company and from any other party in such action if counsel for
Rodman reasonably determines that it would be inappropriate under the applicable
rules of professional responsibility for the same counsel to represent both the
Company and Rodman.  In such event, the reasonable fees and
disbursements of no more than one such separate counsel will be paid by the
Company.  The Company will have the exclusive right to settle the
claim or proceeding provided that the Company will not settle any such claim,
action or proceeding without the prior written consent of Rodman, which will not
be unreasonably withheld.

      


      (C)           The
Company agrees to notify Rodman promptly of the assertion against it or any
other person of any claim or the commencement of any action or proceeding
relating to a transaction contemplated by this engagement letter.

      


      (D)           If
for any reason the foregoing indemnity is unavailable to Rodman or insufficient
to hold Rodman harmless, then the Company shall contribute to the amount paid or
payable by Rodman as a result of such losses, claims, damages or liabilities in
such proportion as is appropriate to reflect not only the relative benefits
received by the Company on the one hand and Rodman on the other, but also the
relative fault of the Company on the one hand and Rodman on the other that
resulted in such losses, claims, damages or liabilities, as well as any relevant
equitable considerations.  The amounts paid or payable by a party in
respect of losses, claims, damages and liabilities referred to above shall be
deemed to include any legal or other fees and expenses incurred in defending any
litigation, proceeding or other action or claim.  Notwithstanding the
provisions hereof, Rodman’s share of the liability hereunder shall not be in
excess of the amount of fees actually received, or to be received, by Rodman
under this engagement letter (excluding any amounts received as reimbursement of
expenses incurred by Rodman).

      


      (E)           These
indemnification provisions shall remain in full force and effect whether or not
the transaction contemplated by this engagement letter is completed and shall
survive the termination of this engagement letter, and shall be in addition to
any liability that the Company might otherwise have to any indemnified party
under this engagement letter or otherwise.

      


      SECTION
9.                      GOVERNING
LAW.  This Agreement will be governed by, and construed in
accordance with, the laws of the State of New York applicable to agreements made
and to be performed entirely in such State.  This Agreement may not be
assigned by either party without the prior written consent of the other
party.  This Agreement shall be binding upon and inure to the benefit
of the parties hereto, and their respective successors and permitted assigns.
Any right to trial by jury with respect to any dispute arising under this
Agreement or any transaction or conduct in connection herewith is
waived.  Any dispute arising under this Agreement may be brought into
the courts of the State of New York or into the Federal Court located in New
York, New York and, by execution and delivery of this Agreement, the Company
hereby accepts for itself and in respect of its property, generally and
unconditionally,

       

       

      
        
          
          

        

        
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      the
jurisdiction of aforesaid courts.  Each party hereto hereby
irrevocably waives personal service of process and consents to process being
served in any such suit, action or proceeding by delivering a copy thereof via
overnight delivery (with evidence of delivery) to such party at the address in
effect for notices to it under this Agreement and agrees that such service shall
constitute good and sufficient service of process and notice
thereof.  Nothing contained herein shall be deemed to limit in any way
any right to serve process in any manner permitted by law. If either party shall
commence an action or proceeding to enforce any provisions of a Transaction
Document, then the prevailing party in such action or proceeding shall be
reimbursed by the other party for its attorneys’ fees and other costs and
expenses incurred with the investigation, preparation and prosecution of such
action or proceeding.

      


      SECTION
10.                                ENTIRE
AGREEMENT/MISC.  This Agreement embodies the entire agreement
and understanding between the parties hereto, and supersedes all prior
agreements and understandings, relating to the subject matter
hereof.  If any provision of this Agreement is determined to be
invalid or unenforceable in any respect, such determination will not affect such
provision in any other respect or any other provision of this Agreement, which
will remain in full force and effect.  This Agreement may not be
amended or otherwise modified or waived except by an instrument in writing
signed by both Rodman and the Company.  The representations,
warranties, agreements and covenants contained herein shall survive the closing
of the Placement and delivery and/or exercise of the Securities, as
applicable.  This Agreement may be executed in two or more
counterparts, all of which when taken together shall be considered one and the
same agreement and shall become effective when counterparts have been signed by
each party and delivered to the other party, it being understood that both
parties need not sign the same counterpart.  In the event that any
signature is delivered by facsimile transmission or a .pdf format file, such
signature shall create a valid and binding obligation of the party executing (or
on whose behalf such signature is executed) with the same force and effect as if
such facsimile or .pdf signature page were an original thereof.

      


      SECTION
11.                                NOTICES.  Any
and all notices or other communications or deliveries required or permitted to
be provided hereunder shall be in writing and shall be deemed given and
effective on the earliest of (a) the date of transmission, if such notice or
communication is delivered via facsimile at the facsimile number specified on
the signature pages attached hereto prior to 6:30 p.m. (New York City time) on a
business day, (b) the next business day after the date of transmission, if such
notice or communication is delivered via facsimile at the facsimile number on
the signature pages attached hereto on a day that is not a business day or later
than 6:30 p.m. (New York City time) on any business day, (c) the business day
following the date of mailing, if sent by U.S. nationally recognized overnight
courier service, or (d) upon actual receipt by the party to whom such notice is
required to be given.  The address for such notices and communications
shall be as set forth on the signature pages hereto.

      



      
        
          
          

           


        

        
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      Please
confirm that the foregoing correctly sets forth our agreement by signing and
returning to Rodman a copy of this Agreement.

      


      


      


      


      Very truly yours,

      


      RODMAN & RENSHAW, LLC

      


      


      By: /s/ John
Borer                                                      

      Name: John Borer

      Title:  Senior Managing
Director

      
 

      Address for
notice:

                1251 Avenue of the Americas,
20th Floor

                                            New York, NY, 10020


                Fax (646) 841-1640

                Attention:  General
Counsel

      


      


      


      Accepted
and Agreed to as of

      the date
first written above:

      


      PACIFIC
ASIA PETROLEUM, INC.

      


      


      By: /s/ Frank C.
Ingriselli                                                                

            Name:  Frank
C. Ingriselli

            Title:  President
and Chief Executive Officer

      


      


      Address for
notice:

      


      250 East
Hartsdale Ave.

      Hartsdale,
NY 10530

      Fax:
(914) 472-6793

      Attention:  President
and Chief Executive Officer

      


      



      
        
           


        

        
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