Document:

Unassociated Document

    CONDITIONAL ACCEPTANCE OF
SETTLEMENT OFFER AND RELEASE

    

    This
CONDITIONAL ACCEPTANCE OF SETTLEMENT OFFER AND RELEASE (hereinafter referred to
as this “Release”) is entered into effective as of November 17, 2010, by and
between among each of Ian T. Bothwell (“Bothwell”), Bruce I. Raben, Ricardo
Rodriguez, Murray J. Feiwell, Nicholas J. Singer and Douglas L. Manner (each, an
“RVEP Insider” and collectively, the “RVEP Insiders”), on the one hand, and Rio
Vista Energy Partners, L.P., a Delaware partnership (collectively with its
subsidiaries, the “Company”), on the other hand.  The RVEP Insiders
and the Company are also collectively referred to herein as the
“Parties”.

    

    RECITALS

    

    A.          The
Company owes the RVEP Insiders approximately $450,000 in aggregate (together
with any other amounts, known or unknown, that may be owing to the RVEP Insiders
(other than unpaid salary and related benefits owing to Bothwell for the period
commencing January 1, 2010 through the date of this Agreement) by the Company,
the “Gross Insiders Amount”) in unpaid salaries, bonuses and other fees in
respect of services provided by the RVEP Insiders to and on behalf of the
Company (the “Services”).

    

    B.           The
Company has also made past commitments to issue or grant certain warrants to
acquire Company securities to the Insiders (collectively, the “Insider
Warrants”), none of which had been issued as of the date hereof.

    

    C.           In
connection with and as a condition to the closing of the transactions
contemplated by that certain Securities Purchase and Sale Agreement by and
between Central Energy, LLC (the “Purchaser”), the Company and Penn Octane
Corporation dated as of May 25, 2010 (as amended, the “SPA”), the Company has
made an offer of settlement of the Gross Insiders Amount, which offer consists
of payment of $359,000  (the “Settlement Amount”) together with
interest thereon, on or before the date which is nine months following the
Closing Date (as defined in the SPA) (the “Outside Date”).

    

    D.          The
Company has conditioned its settlement offer on, inter alia, the surrender by
the RVEP Insiders of any and all rights they may have, individually and
collectively, to any Insider Warrants.

    

    E.           In
connection with the closing of the SPA, the Company will be issued a promissory
note in the principal amount of One Million Dollars and No Cents ($1,000,000.00)
by the Purchaser (the “Purchaser Note”), which Purchaser Note shall bear
interest at 7.5% per annum and shall be payable on or prior to the Outside Date,
pursuant to which the Purchaser is obligated to pay the first monies payable
under the Purchaser Note (up to the Settlement Amount plus Interest) directly to
the Insiders Account (as defined below).

    

    Subject
to the conditions precedent and terms set forth in this Release, the Parties
have agreed to settle and compromise all of the claims between them, including
as it relates to payment of the Gross Insiders Amount.

    
      
         

      

      
        1

        
          

        

      

      
         

      

    

    

    SETTLEMENT

    

    In consideration of the compromise of
any and all respective claims and contentions, and the promises,
representations, and warranties contained in this Release, the parties agree as
follows:

    

    1.           Settlement Amount; Surrender
of Rights to Insider Warrants.  The Insiders agree to accept
payment of the Settlement Amount plus interest thereon at the rate of 7.5% per
annum from and after the Closing Date (“Interest”) as payment in full for the
Gross Insiders Amount, which amount reflects a substantial discount of the
actual amount owed, subject to full payment of the Settlement Amount (together
with interest thereon) on or prior to the Outside Date and according to the
other terms set forth below.  Each RVEP Insider further agrees not to
pursue enforced collection for the Settlement Amount prior to the Outside Date,
except as may be otherwise expressly set forth below.  Each RVEP
Insider hereby irrevocably surrenders any right he may have to any Insider
Warrants and agrees that any such rights are forever forfeited with respect
thereto from and after the date of this Release.

    

    2.           Payment Terms and
Schedule.

    

    (a)     
    The Company shall make payment of the Settlement Amount
(or cause such payment to be made) together with Interest thereon to the
Insiders, pro rata based on the percentages set forth on Schedule 1 to this
Release, on or prior to the Outside Date, by certified check or wire transfer to
the escrow account set forth on Schedule 1 or such other account(s) as may be
directed in writing by Bothwell (as the Insiders Representative) or by RVEP
Insiders holding a majority of the ProRata Percentages in aggregate (the
“Insiders Account”).

    

    (b)         If
the Company fails to make or cause to be made payment to the Insiders of the
Settlement Amount plus accrued and unpaid Interest thereon on or prior to the
Outside Date, the release by the Insiders set forth in Section 3 of this Release
shall be null and void, and the Insiders shall retain the right to be paid the
Settlement Amount plus interest thereon from the Closing Date at the rate of
7.5% per annum.

    

    (c)         Upon
default by the Company for failure to make payment of the Settlement Amount plus
accrued and unpaid Interest thereon on or prior to the Outside Date, the
Insiders shall have the option to exercise any and all applicable remedies for
recovery of the Settlement Amount, including but not limited to the referral of
the issue to a debt collection agency, and/or the filing of a lawsuit for
collection of such amount.

    

    (d)         The
Company agrees, for so long as any of the Settlement Amount plus Interest
remains unpaid, to cause any monies it receives under the Purchaser Note to be
promptly paid to the Insider Escrow Account until all such amounts are fully
paid.

    

    3.           Insiders’
Release.  The following release by the Insiders shall be valid
only in the event the entire Settlement Amount plus Interest is paid by the
Company to the Insiders in full on or prior to the Outside
Date:

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    

    (a)         Subject
to timely payment of the full Settlement Amount plus Interest thereon, each
Insider hereby releases and forever discharges the Company and Rio Vista GP,
LLC, as well as their respective officers, directors, employees, owners, agents,
attorneys and assigns (hereinafter referred to as “Company Released Parties” and
the “RVGP Released Parties” respectively) from any and all claims, rights,
demands, liabilities, actions or causes of action, obligations, and damages of
any kind, name, nature or description, either at law or in equity, whether known
or unknown, that in any manner may have arisen from the beginning of time
through the Closing Date, including without limitation, any claim any Insiders
may have to any Insider Warrants.

    

    (b)         The
preceding release extends to and includes any and all claims, liabilities,
injuries, damages, and causes of action against the Company Released Parties and
the RVGP Released Parties, that any Insider does not presently anticipate, know,
or suspect to exist, but that may develop, accrue, or be discovered in the
future.

    

    EACH
INSIDER EXPRESSLY WAIVES ALL RIGHTS UNDER CALIFORNIA CIVIL CODE SECTION 1542 AND
ANY SIMILAR APPLICABLE STATE OR FEDERAL STATUTE, WHICH PROVIDES: “A general
release does not extend to claims which the creditor does not know or suspect to
exist in his favor at the time of executing the release, which if known by him
must have materially affected his settlement with the debtor.”

    

    (c)         Each
Insider represents and warrants that it has considered the possibility that
claims, liabilities, injuries, damages and causes of action against the Company
Released Parties that it does not presently know or suspect to exist in its
favor may develop, accrue, or be discovered in the future, and that it
voluntarily assumes that risk as part of the consideration for this
Release.

    

    (d)         Nothing
in the releases set forth herein will affect any Insider’s right to receive the
benefits set forth in this Release, or affect an Insider’s right to make claim
for his pro rata percentage (as set forth in Schedule 1) of the Settlement
Amount in the event of a breach or default by the Company of this
Release.

    

    (e)         This
Release does not apply to any obligation owed to an Insider by any entity other
than the Company, including, but not limited to Penn Octane
Corporation.

    

    4.           No Assignment of
Claims.      All parties hereto represent
and warrant that each of them has not assigned, transferred or negotiated, or
purported to assign, transfer or negotiate, to or with any person, firm,
corporation or other legal entity any claim, right, demands, liability, action,
obligation, cost, expense, or cause of action herein released.  Each
Party further hereby warrants and represents that there is no other person or
entity from whom a release or waiver should be obtained for any of the claims,
rights, demands, liabilities, actions or causes of action hereby released or
settled.

    

    Notwithstanding the foregoing, each
Insider shall have the right and option to assign its claim for payment of the
Settlement Amount and Interest thereon in the event the Company fails to timely
make payment of the Settlement Amount and Interest thereon upon the terms and
conditions set forth in Section 2 above.

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    

    5.           Binding
Agreement.      All Parties hereto
expressly acknowledge that this Release shall be binding on any predecessors,
representatives, successors, heirs, assigns or issue of the parties
hereto.

    

    6.           Cooperation.      The
parties hereto hereby agree to fully cooperate and take any and all necessary
steps to carry out the intent of this Release.

    

    7.           Injunctive
Relief.      This Release may be pleaded by
any party as a full and complete defense to any claim covered by the Release as
set forth herein and each party hereby consents that it may be used as a basis
for entry of a temporary, preliminary, and/or permanent injunction against, any
action, suit or other proceeding based on any claim or claims released by this
Release.

    

    8.           Choice of
Law.      This Release is entered into in
accordance with, and shall be governed by, the laws of the State of California;
provided, however, that in the event any law or laws of the State of California
shall require or otherwise dictate that the laws of any other state or
jurisdiction be applied in any proceeding, such California law or laws shall be
superseded by this paragraph and the remaining laws of the State of California
shall be applied in such proceeding.  Where the context requires, the
masculine, feminine, and neuter genders shall be construed to include each
other, as shall the singular and the plural and the past, present, and future
tenses.  Any action brought to enforce the terms of this Release may
be brought in the San Francisco County Superior Court.  The Company
irrevocably waives any right to challenge personal jurisdiction or the
appropriateness of venue.

    

    9.           Severability.      In
the event that any portion of this Release is adjudged by a court of competent
jurisdiction to be unenforceable, it is the express intent of the parties that
the remainder of this Release shall remain in full force and
effect.

    

    10.         Representation by
Counsel.      Each party represents and
warrants that they have, or had, the opportunity to employ attorneys to
represent them with respect to the Release and all matters covered hereby, and
that they have been fully advised with respect to their respective rights and
responsibilities in connection with the execution of this Release to the extent
they view appropriate.  This Release was drafted jointly by or on
behalf of the parties, and shall not be interpreted against any party on the
basis that the party or the party’s attorney drafted any of the
provisions.

    

    11.         Entire
Agreement.      This Release supersedes any
and all other agreements, or releases either oral or in writing, among the
parties with respect to the subject matter hereof, and contains the entire
agreement among the parties relating to such subject matter.  Each
party represents and warrants that no promise or inducement to enter into this
Release has been made to him that is not set forth in this
Release.  This Release may not be orally superseded, modified or
amended except by an instrument in writing executed by the parties
hereto.

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    

    12.         Further
Assurances.      Each party agrees that it
will execute, or cause to be executed, such further documents as may be needed
to carry out the expressed intents and purposes of this Release.

    

    13.         Attorney Fees and
Costs.      If any legal action is
commenced to interpret, enforce, or recover damages for the breach of any term
of this Release, or in the collection of the Settlement Amount or Interest
thereon, the prevailing party shall be entitled to recover reasonable attorney
fees incurred in connection with that action, in addition to costs of
suit.

    

    14.         No Admission of
Liability.      It is expressly understood,
acknowledged and agreed to that, by reason of entering into this Release, none
of the parties admit, expressly or impliedly, any fact or liability of any type
or nature with respect to any matter, whether or not referred to herein, and
that this Release is entered into solely by way of compromise and settlement
only.

    

    15.         Counterparts.  This
Release may be executed in two or more counterparts, each of which shall be
deemed to be an original, and all counterparts shall together constitute the
Release. This Release may be executed by facsimile signature, and such
signatures shall be treated as a fully enforceable signature hereto upon receipt
by facsimile or mail by the other party.

    

    16.         Authority.  Each
undersigned person signing this Release hereby represents and warrants that they
are duly authorized to execute this Release on behalf of the entity named and
said Release will be fully binding on each of the respective parties in
accordance with its terms.

    

    REMAINDER
OF PAGE DELIBERATELY LEFT BLANK

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    IN WITNESS WHEREOF, the parties have
caused this Release to be executed effective as of the day and year stated
below.

    

    
      Date:
November 17, 2010

    

    

    
      RIO VISTA
ENERGY PARTNERS L.P.

    

    

    
      
        	
                Date: 11/17/10

              	
                By:  

              	
                /s/ Ian T. Bothwell

              
	 
      	
                Name:  Ian T. Bothwell

              
	 
      	
                Title:  President and CEO

              

      

    

    

    INSIDERS

    

    
      
        	
                /s/ Ian T. Bothwell

              
	
                Ian
      T. Bothwell

              
	 
      
	
                /s/ Bruce I. Raben

              
	
                Bruce
      I. Raben

              
	 
      
	
                /s/ Ricardo Rodriguez

              
	
                Ricardo
      Rodriguez

              
	 
      
	
                /s/ Murray J. Feiwell

              
	
                Murray
      J. Feiwell

              
	 
      
	
                /s/ Nicholas J. Singer

              
	
                Nicholas
      J. Singer

              
	 
      
	
                /s/ Douglas L. Manner

              
	
                Douglas
      L. Manner

              

      

    

    
      
         

      

      
        6MUTUAL
RELEASE

    

    This
Mutual Release (the “Release”) is made and
entered into as of this __ day of November, 2010, by and among Penn Octane
Corporation (“POCC”), on the one
hand, and Rio Vista Energy Partners, L.P. (“RVEP”) and Rio Vista
GP, LLC, the general partner of RVEP (“RVGP” and together with RVEP, the “Rio Vista Parties”),
on the other hand.

     

    RECITALS

     

    A.          POCC
and RVEP are parties to that certain Securities Purchase and Sale Agreement with
Central Energy, LP (as successor by assignment to Central Energy, LLC) (“Buyer”) dated as of
May 25, 2010 and subsequently amended as of July 1, 2010, July 8, 2010, July 21,
2010 and November 17, 2010 (as amended, the “Purchase Agreement”)
pursuant to which, inter alia, (i) Buyer agreed to purchase certain Common Units
of RVEP from RVEP (the “Common Units”) and
all of the membership interests in RVGP (the “RVGP Units”) from
POCC and (ii) RVEP agreed to pay from the proceeds from such sale of Common
Units, $1.2 million to POCC (the “POCC Payment”) in
full satisfaction of all amounts owing to POCC as of the Closing (as defined in
the Purchase Agreement), including under that certain promissory note issued by
RVEP in favor of POCC dated as of [____________] (the “POCC
Note”).

     

    B.      
    Immediately prior to the Closing, POCC held 75% of the
RVGP Units and The Richter Living Trust (the “Richter Trust”) held
25% of the RVGP Units.  Pursuant to that certain Confidential
Settlement Agreement and General Release of Claims dated as of March 30, 2010 by
and among POCC, RVEP, Jerome B. Richter (“Richter”), Jerome B. Richter Capital
Resources, Inc. (“JBR”) and The Richter Trust (together with Richter and JBR,
the “JBR
Parties”), as modified by an Addendum thereto dated as of November 17,
2010, the Richter Trust agreed to transfer to POCC for no consideration, the
RVGP Units held by the Richter Trust upon receipt of payment by Richter of
$575,000 in full satisfaction of all amounts owing to the JBR Parties (the
“Richter Settlement
Payment”).

     

    C.           Pursuant
to the Purchase Agreement, at the Closing, (i) Buyer purchased Common Units from
RVEP, (ii) RVEP made the POCC Payment, (iii) POCC paid Richter the Richter
Settlement Payment, (iv) the Richter Trust transferred its RVGP Units to POCC,
and (iv) Buyer purchased from POCC all of the RVGP Units.

     

    D.          The
Rio Vista Parties desire to release POCC, and POCC desires to release the Rio
Vista Parties, from any and all liabilities and claims against the other arising
prior to the date hereof and through and including the date of this Release,
including without limitation, with respect to the POCC Note and any other
obligations (monetary or otherwise) owing by POCC or any Rio Vista Party to the
other (other than as set forth in the Purchase Agreement and related
documentation dated as of the date of this Release and contemplated thereby),
all on the terms and subject to the conditions contained herein.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    AGREEMENT

     

    In
consideration of the premises hereinabove and covenants hereinafter contained,
it is agreed by and between the parties hereto as follows:

     

    1.           Mutual
Release.  The Rio Vista Parties and each of its respective
officers, directors, employees, members, managers, representatives, agents,
affiliates, successors, assigns, family members and heirs (the “Rio Vista Releasing
Parties”), on the one hand, and POCC and its officers, directors,
employees, members, managers, representatives, agents, affiliates, successors,
assigns, family members and heirs (the “POCC Parties”), on
the other hand, each releases and absolutely discharges the other from any and
all claims, demands, damages, judgments, liens, losses, debts, liabilities,
accounts, reckonings, covenants, contracts, agreements, promises, sums of money,
obligations, attorneys' fees, costs, expenses, liens, actions, suits, dues, and
causes of action of every kind and nature, known or unknown, matured or
unmatured, absolute or contingent (the “Claims”), which any
of the Rio Vista Releasing Parties, on one hand, or any of the POCC Parties, on
the other hand, now have, have had at any time in the past, or may hereafter
have or acquire against the other for any reason or event occurring at any time
from the beginning of the world until the time of the execution of this Release
(other than in connection with the enforcement of the terms of this Release, the
Purchase Agreement and related agreements and instruments entered into in
connection therewith), including, without limitation, with respect to the POCC
Note.

     

    2.           No Rescission
Right.  Each of the parties hereto further agrees and
acknowledges that the facts in respect to which it has executed this Release and
which it now knows or believes to be true, may in fact be or may subsequently be
discovered by it to have been different from the facts now known or believed by
it to be true; and each party hereby accepts the risk and possibility that such
may be the case, and agrees that this Release shall not be subject to
rescission, cancellation, avoidance, or modification by reason of any difference
in facts.

     

    3.           Choice of
Law.  This Release shall be construed and interpreted under and
according to the laws of the State of New York.  In the event any
provisions of this Release are held by a court or tribunal of competent
jurisdiction to be unenforceable, the remaining provisions of this Release shall
remain in full force and effect; provided that the release by the Rio Vista
Releasing Parties shall not be enforceable if the release by the POCC Parties,
and vice
versa.

     

    4.           Assigns.  This
Release is and shall be binding upon and shall inure to the benefit of the
predecessors, successors, subsidiaries, affiliates, representatives, assigns,
directors, officers, attorneys or employees of each of the parties.

     

    5.           Entire
Agreement.  This Release constitutes the entire agreement
between the parties with regard to the subject matter hereof, there being no
oral, collateral, or supplemental agreement concerning the subject matter hereof
and supercedes all prior or contemporaneous agreements and understandings
pertaining thereto.  This Release may not be altered, amended,
modified or otherwise changed in any respect or particular, as to any party,
except by a writing duly executed by each party affected thereby.

     

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

     

    6.           Representations of the
Parties.  Each of the parties hereto represents and warrants to
each other party hereto that: (i) he or it has not assigned to anyone any of the
rights, claims or causes of action that arose or could have arisen out of the
prior relationship between the POCC Parties and the Rio Vista Releasing Parties
including, without limitation, any of the rights, claims, or causes of action
arising under the POCC Note; and (ii) the execution of this Release has been
duly authorized by requisite corporate or partnership or limited liability
company actions, and that each of the persons executing this Release on behalf
of the respective parties hereto, is, likewise, duly authorized to do
so.

     

    7.           No Admission of Liability or
Fault.  Each party acknowledges and agrees that this Release
does not, in any manner, constitute an admission of liability or fault
whatsoever by any party and that this Release is made solely for the purpose of
settling any and all obligations owed or arising between the parties finally and
completely.

     

    8.           Counterparts;
Effectiveness.  This Release may be executed in multiple
counterparts, each of which shall be deemed an original, but all of which, when
taken together, shall constitute one and the same instrument.  A faxed
or PDF signature shall have the same force and effect as an original
signature.  This Release shall not be binding or enforceable until
executed and delivered by all parties hereto.

     

    [Signature
Page Follows]

     

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    IN WITNESS WHEREOF, this
Mutual Release is executed by the parties hereto as of the day and year first
above written.

     

    
      
        
          	 
      	
                  PENN
      OCTANE CORPORATION

                
	 
      	 
      	 
      
	 
      	
                  By:

                	
                  /s/ Ian T. Bothwell

                
	 
      	 
      	
                  Name:
      Ian T. Bothwell

                
	 
      	 
      	
                  Title:
      President

                
	 
      	 
      	 
      
	 
      	
                  RIO
      VISTA ENERGY PARTNER, L.P.

                
	 
      	 
      
	 
      	
                  By:
      Rio Vista GP, LLC, its General Partner

                
	 
      	 
      	 
      
	 
      	
                  By:

                	
                  /s/ Ian T. Bothwell

                
	 
      	 
      	
                  Name:
      Ian T. Bothwell

                
	 
      	 
      	
                  Title:
      President

                
	 
      	 
      	 
      
	 
      	
                  RIO
      VISTA GP, LLC

                
	 
      	 
      	 
      
	 
      	
                  By:

                	
                  /s/ Ian T. Bothwell

                
	 
      	 
      	
                  Name:
      Ian T. Bothwell

                
	 
      	 
      	
                  Title:
      President

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00181-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00181-of-00352.parquet"}]]