Document:

Exhibit 10.1

Exhibit 10.1

SETTLEMENT AGREEMENT

This Settlement Agreement (this “Agreement”) is made as of May 27, 2009, by and among:

	 	•	 	Rio Vista Energy Partners L.P., a Delaware limited partnership (“Parent”),

	 	•	 	Rio Vista ECO LLC, an Oklahoma limited liability company (“ECO”),

	 	•	 	TCW Asset Management Company, a California corporation, solely in its capacity
as administrative agent for Holder (in such capacity, together with its successors
and assigns in such capacity, “Administrative Agent”), and

	 	•	 	TCW Energy X Blocker (Rio Vista), L.L.C., a Delaware limited liability company
(“TCW Blocker”), as the holder of the Notes issued pursuant to the Note Purchase
Agreement described below (in such capacity, together with its successors and
assigns=, “Holder”) and as the owner of the Warrant described in the Note Purchase
Agreement (in such capacity, together with its successors and assigns, “Warrant
Owner”).

R E C I T A L S:

WHEREAS, Rio Vista Penny LLC, an Oklahoma limited liability company (“Company”),
Administrative Agent, and the noteholders party thereto entered into that certain Note Purchase
Agreement dated as of November 19, 2007 (as amended or supplemented to the date hereof, the “Note
Purchase Agreement”), for the purpose and consideration therein expressed, whereby ltrchsuch
noteholders made senior secured term loans to Company as therein provided;

WHEREAS, Defaults and Events of Defaults now exist and are continuing under the Note Purchase
Agreement;

WHEREAS, pursuant to the terms and provisions of the Warrant, Warrant Owner previously
exercised its right to purchase 400,000 common units of Parent (the “Purchased Parent Units”) from
Parent (the “Warrant Exercise”); and

WHEREAS, pursuant to that certain Assignment and Assumption dated of even date herewith,
Holder purchased all of the Notes issued pursuant to the Note Purchase Agreement;

 

 

 

NOW, THEREFORE, in consideration of the various acknowledgments and agreements contained
herein, and for other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto do hereby acknowledge and agree as follows:

SECTION I. =DEFINITIONS

Unless the context otherwise requires or unless otherwise expressly defined herein, the terms
defined in the Note Purchase Agreement shall have the same meanings whenever used in this
Agreement. As used herein, terms defined above have the meanings given them above, and the
following additional terms shall have the following meanings:

“Acquired Assets” means the assets of Company (including without limitation the stock
of MV Pipeline), GO, GO LLC, and Rio Vista Operating.

“Agreed Asset Value” means $12,000,000.

“Equity Foreclosure Date” means the date on which the Equity Foreclosure Sale was
conducted.

=default“Equity Foreclosure Sale” means the foreclosure sale conducted by
Administrative Agent, as secured party, on May 27, 2009 at or about 11:00 a.m. at the
offices of Thompson & Knight LLP, 1722 Routh Street, Suite 1500, Dallas, Texas 75201 with
respect to all of the Equity of Company and GO.

“Excluded Obligations” means all obligations and duties owing by any TCW Released
Person or any RVEP Released Person under or with respect to this Agreement, the Registration
Rights Agreement, the Rio Vista Operating Assignment, the Warrant Assignment, any
certificate delivered in connection with this Agreement, or the Purchased Parent Units.

“Penny Entities” means Company, GO, GO LLC, and MV Pipeline.

“Registration Rights Agreement” means the Registration Rights Agreement in the form of
Exhibit A.

“Rio Vista Operating” means Rio Vista Operating LLC, an Oklahoma limited liability
company.

“Rio Vista Operating Assignment” means the Rio Vista Operating Assignment in the form
of Exhibit B.

“Rio Vista Operating Assignment Date” means the date on which Parent assigned all of
the Equity in Rio Vista Operating to Warrant Owner.

“RVEP Entities” means Parent and ECO.

“RVEP Released Claims” means any and all actions, causes of action, judgment=s,
executions, suits, debts, claims, demands, controversies, liabilities, obligations, damages
and expenses of any and every character (whether known or unknown, liquidated or
unliquidated, absolute or contingent, acknowledged or disputed, direct or indirect), at law
or in equity, of whatsoever kind or nature (including without limitation claims of usury),
whether heretofore or hereafter accruing, for or because of any matter or things done,
omitted or suffered to be done by any of the RVEP Released Persons prior to and including
the date hereof that in any way directly or indirectly arise out of or in any way are
connected to (a) any of the Note Documents or any default or event of default thereunder,
(b) any negotiation, discussion, enforcement action, agreement or failure to agree related
to any Note Document or any default or event of default thereunder, (c) any action, event,
occurrence, or omission otherwise related to the rights, duties, obligations and
relationships related to any Note Document among the various RVEP Released Persons, on the
one hand, and Administrative Agent, Holder and/or Warrant Owner, on the other hand, or (d)
the operation and/or administration of the real and personal properties of the Penny
Entities or Rio Vista Operating prior to the date of this Agreement, provided that the RVEP
Released Claims do not include the Excluded Obligations or any claims, demands or other
actions to assert or enforce the Excluded Obligations.

 

2

 

“RVEP Released Persons” means each RVEP Entity, Regional Enterprises, Inc., Penn Octane
Corporation, and Rio Vista GP LLC, together with each of their respective employees, agents,
attorneys, officers, partners, shareholders, accountants, consultants, directors, and
Affiliates, and their respective successors and assigns, excluding however the Penny
Entities and Rio Vista Operating.

“Tax” means (a) all taxes, assessments, charges, duties, fees, levies, imposts or other
similar charges imposed by a taxing authority, including without limitation all income,
franchise, profits, margins, capital gains, capital stock, transfer, gross receipts, sales,
use=, transfer, service, occupation, ad valorem, real or personal property, excise,
severance, windfall profits, customs, premium, stamp, license, payroll, employment, social
security, unemployment, disability, environmental, alternative minimum, add-on, value-added,
withholding and other taxes, assessments, charges, duties, fees, levies, imposts or other
similar charges of any kind, and all estimated taxes, deficiency assessments, additions to
tax, penalties and interest with respect to taxes, whether disputed or otherwise and (b) any
liability for the payment of any amounts of the type described in clause (a) as a result of
any express or implied obligation to indemnify or otherwise assume or succeed to the
liability of any other Person as a successor, transferee, by contract, or otherwise.

“Tax Return” means any report, return, election, document, estimated Tax filing,
declaration, claim for refund, information return, or other filing related to Taxes provided
to any taxing authority including without limitation any schedules or attachments thereto
and any amendment thereof.

“TCW Released Claims” means any and all actions, causes of action, judgments,
executions, suits, debts, claims, demands, controversies, liabilities, obligations, damages
and expenses of any and every character (whether known or unknown, liquidated or
unliquidated, absolute or contingent, acknowledged or disputed, direct or indirect), at law
or in equity, of whatsoever kind or nature (including without limitation claims of usury),
whether heretofore or hereafter accruing, for or because of any matter or things done,
omitted or suffered to be do=ne by any of the TCW Released Persons prior to and including
the date hereof that in any way directly or indirectly arise out of or in any way are
connected to (a) any of the Note Documents or any default or event of default thereunder,
(b) the Equity Foreclosure Sale, (c) the Warrant Exercise, (d) any negotiation, discussion,
enforcement action, agreement or failure to agree related to any Note Document or any
default or event of default thereunder or to the Equity Foreclosure or the Warrant Exercise,
or (e) any action, event, occurrence, or omission otherwise related to the rights, duties,
obligations and relationships among Parent and the various Restricted Persons and Holder
Parties, provided that the TCW Released Claims do not include the Excluded Obligations or
any claims, demands or other actions to assert or enforce the Excluded Obligations.

 

3

 

“TCW Released Persons” means Administrative Agent, Holder, Warrant Owner, Royalty
Owner, Rio Vista Operating, and each Penny Entity, together with each of their respective
employees, agents, attorneys, officers, partners, shareholders, accountants, consultants,
directors, and Affiliates, and their respective predecessors in interest and successors and
assigns.

“Warrant Assignment” means the Warrant Assignment in the form of Exhibit C.

SECTION II. WARRANT AGREEMENTS

2.1. =tRegistration Rights. Parent hereby agrees (a) to grant Warrant Owner the right to
participate, to the extent permitted by applicable Law, in any subsequent registration of Parent’s
common units, upon and pursuant to the terms of the Registration Rights Agreement, and (b) to duly
execute and deliver the Registration Rights Agreement to Warrant Owner contemporaneously with the
effectiveness of this Agreement.

2.2. Sale of Warrant. Warrant Owner hereby agrees (a) to sell the portion of the Warrant
remaining following the Warrant Exercise to Parent in consideration of the agreements of Parent set
forth in this Agreement (including without limitation the agreements of Parent set forth in Section
2.1 and Section 3), and (b) to duly execute and deliver the Warrant Assignment to Parent
contemporaneously with the effectiveness of this Agreement. After such sale and assignment,
neither Administrative Agent, Warrant Owner, nor Holder shall have any further rights under the
Warrant.

SECTION III. FORECLOSURE AGREEMENTS

3.1. Equity Foreclosure. Pursuant to the Equity Foreclosure Sale, Holder purchased all of the
Equity of Company and GO. Each RVEP Entity hereby (a) ratifies and confirms the Equity Foreclosure
Sale in all respects and agrees not to challenge or dispute the Equity Foreclosure Sale or any
aspect thereof in any way, (b) agrees that the Equity Foreclosure Sale constituted a “public
disposition” under the UCC, (c) agrees that every aspect of the Equity Foreclosure Sale (including
without limitation the notice, method, manner, time and place) was commercially reasonable in all
respects, and (d) acknowledges that Holder purchased all of the Equity of Company and GO at the
Equity Foreclosure Sale, together with all related rights of ownership in and to such Persons.

 

4

 

3.2. Asset Foreclosure. Administrative Agent and/or Holder may hereafter elect to pursue
appropriate foreclosure action with respect to some or all of the real and personal property of the
Penny Entities, which may include judicial foreclosure proceedings in the State of Oklahoma
(collectively, the “Asset Foreclosure”). In the event that Administrative Agent and/or Holder
pursues an Asset Foreclosure, Parent agrees that it will not (and will cause its Subsidiaries to
not) contest or otherwise intervene in any Asset Foreclosure proceedings. =

3.3. Operations. Rio Vista Operating is the operator of the oil and gas properties owned by
the Penny Entities, and it has no other business activities. In consideration of Warrant Owner’s
agreement to sell the Warrant to Parent pursuant to Section 2.2, Parent hereby agrees to (a) to
assign all of the Equity in Rio Vista Operating to Warrant Owner, and (b) to duly execute and
deliver the Rio Vista Operating Assignment to Warrant Owner contemporaneously with the
effectiveness of this Agreement.

3.4. Further Assurances and Information. Each RVEP Entity hereby agrees that from time to
time: (a) it shall each execute or deliver to Administrative Agent such further instruments or
documents, and take such further action, as are reasonably requested by Administrative Agent to
accomplish the transactions described in this Agreement, (b) it shall otherwise reasonably
cooperate with ltrchAdministrative Agent in Administrative Agent’s effort to conduct subsequent
sales or other dispositions of assets in connection with an Asset Foreclosure, and (c) it will
promptly furnish to Administrative Agent any information within its possession which Administrative
Agent may from time to time request concerning the businesses, properties, prospects, financial
condition and operations of Rio Vista Operating or any Penny Entity (including without limitation
books, records, maps, engineering information, software, contracts, and other information related
to the real and personal property of Rio Vista Operating or any Penny Entity). In addition, each
RVEP Entity hereby agrees that Administrative Agent and/or Holder (in the exercise of their
discretion) shall be entitled to make offers of employment to employees of Parent or its
Subsidiaries whose employment relates to the operations and/or administration of the real and
personal properties of the Penny Entities or Rio Vista Operating.

3.5. Tax Treatment. = The RVEP Entities and TCW Blocker acknowledge and agree that, for
federal income tax purposes:

(a) The Warrant Exercise will be treated as if Parent sold, and TCW Blocker purchased, the
Purchased Parent Units in exchange for a reduction in the outstanding amount of accrued but unpaid
interest on the Notes and the then outstanding principal amount of the Notes in an aggregate amount
equal to the fair market value of the Purchased Parent Units at the time of the Warrant Exercise.

(b) The sale of the remaining portion of the Warrant pursuant to Section 2.2 and Section 3
hereof will be treated as if Parent sold, and TCW Blocker purchased, all of the assets of Rio Vista
Operating and the agreements of Parent set forth in this Agreement in exchange for the fair market
value of the remaining portion of the Warrant.

 

5

 

(c) The Equity Foreclosure Sale will be treated as if Parent sold, and TCW Blocker purchased,
all of the assets of Company (which includes the stock of MV Pipeline) and all of the assets of GO
(which includes all of the assets of GO LLC) in exchange for any remaining accrued but unpaid
interest on the Notes and the =7 then remaining outstanding principal amount of the Notes.

(d) The Asset Foreclosure will not have any federal income tax consequences other than in
connection with any foreclosure action with respect to some or all of the real and personal
property of MV Pipeline.

The RVEP Entities and TCW Newco shall report, and shall cause their Subsidiaries and
Affiliates to report, the transactions contemplated hereby on all Tax Returns in a manner
consistent with the treatment set forth above in this Section 3.5.

3.6. FIRPTA Certificate. On or prior to the Equity Foreclosure Date, Parent shall have
delivered to TCW Blocker a certificate to the effect that Parent is not a “foreign person” within
the meaning of Section 1445 of the Internal Revenue Code and the Treasury Regulations thereunder in
the form of Exhibit D.

3.7. Invoices. In the event that Rio Vista Operating or any Penny Entity receives an invoice
or other claim after the date hereof (a) for accounting services rendered to such Persons prior to
the date hereof, (b) for petroleum engineering services related to the assets of the Penny Entities
rendered prior to the date hereof, or (c) related to the businesses or operations of Parent or any
of its Subsidiaries (other than the Penny Entities and Rio Vista Operating), then Parent hereby
agrees that it will pay such invoice or claim directly to the Person to whom it is owed or, if
requested by the applicable Penny Entity or Rio Vista Operating, reimburse such Person for such
expense promptly upon its request therefor.

SECTION IV. REPRESENTATIONS, WARRANTIES AND AGREEMENTS

wrapdefaultEach RVEP Entity hereby represents, warrants, acknowledges, admits and agrees as
follows:

(a) This Agreement is the legal, valid and binding obligation of each RVEP Entity, enforceable
against each in accordance with its terms, except as such enforcement may be limited by bankruptcy,
insolvency or similar Laws of general application relating to the enforcement of creditors’ rights
and by general principles of equity.

(b) Such RVEP Entity has the corporate or company power, and has been duly authorized by all
requisite action, to execute and deliver this Agreement and to perform its obligations hereunder.
This Agreement has been duly executed and delivered by such RVEP Entity.

 

6

 

(c) The execution, delivery and performance of this Agreement by =1 such RVEP Entity does not
and will not (i) to the best of its knowledge, violate any law, rule, regulation or court order to
which it is subject, (ii) conflict with or result in a breach of its charter, bylaws, or any
agreement or instrument to which it is a party or by which it or its properties are bound, or
(iii) to the best of its knowledge, result in the creation or imposition of any lien, security
interest or encumbrance on any property of such RVEP Entity, whether not owned or hereafter
acquired, other than liens in favor of Administrative Agent or Holders granted pursuant to the Note
Documents.

(d) The recitals set forth above are true and accurate and are an operative part of this
Agreement.

(e) After giving effect to the provisions of Section 7.2, no contractual agreements (whether
written or oral) exist between Rio Vista Operating or any Penny Entity, on the one hand, and Parent
or any other Subsidiary or Affiliate of Parent, on the other hand.

(f) The Penny Entities and Rio Vista Operating have no Deposit Accounts, except for (i) the
following Deposit Accounts established at Bank of Eufaula, 102 N. Main, P=1 .O. Box 607, Eufaula,
OK 74432:

	 	 	 	 	 
	Rio Vista Penny, LLC — Operating Account
	 	 	#6524272	 
	Rio Vista Penny, LLC — Savings Account
	 	 	#494512	 
	 
	Rio Vista Penny, LLC — CD #1
	 	 	#27770	 
	 
	Rio Vista Penny, LLC — CD #2
	 	 	#27888	 
	 
	=arrsid11804459 Rio Vista Penny, LLC — Custody Account
	 	 	#6524250	 

and (ii) two Deposit Accounts established at Wells Fargo Bank National Association with
nominal balances, which are to be closed.

(g) (i) Each of ECO, Company, GO, and GO LLC has been treated as disregarded from Parent for
federal tax purposes, and MV Pipeline has been treated as a corporation for federal tax purposes,
at all times prior to the Equity Foreclosure Date, and Rio Vista Operating has been treated as
disregarded from Parent for federal tax purposes at all times prior to the Rio Vista Operating
Assignment Date; (ii) there are no unpaid income or franchise taxes for calendar year 2008 or any
prior years in an aggregate amount in excess of $100,000 due from the Penny Entities and Rio Vista
Operating relating to the Penny Entities and Rio Vista Operating; (iii) there are no liens for
Taxes (other than liens for Taxes not yet due and payable) upon any of the Acquired Assets or the
assets of MV Pipeline; (iv) there has been no issue raised or adjustment proposed (and to Parent’s
knowledge, none is pending) by any taxing authority in connection with any Tax for a period on or
before the date of this Agreement; (v) none of any RVEP Entity, any Penny Entity, or Rio Vista
Operating has received any notice from any taxing authority that any Tax Return is being audited or
may be audited or examined; (vi) no waiver or extension of any statute of

 

7

 

limitations as to any Tax matter relating to the Acquired Assets
or MV Pipeline has been given by or requested from any RVEP Entity, any Penny Entity, or Rio Vista
Operating; (vii) to Parent’s knowledge, no claim has been made by any taxing authority in a
jurisdiction where an RVEP Entity, a Penny Entity, or Rio Vista Operating does not file a Tax=
Return that such entity is or may be subject to taxation in that jurisdiction; (viii) none of any
RVEP Entity, any Penny Entity, or Rio Vista Operating is a party to any Tax allocation or sharing
agreement with respect to MV Pipeline or the Acquired Assets; (ix) Parent is not a “foreign person”
within the meaning of Section 1445 of the Internal Revenue Code and the Treasury Regulations
thereunder; (x) each RVEP Entity, each Penny Entity, and Rio Vista Operating has complied with all
applicable laws relating to the paying and withholding of Taxes and has duly and timely withheld
and paid over to the appropriate taxing authority all amounts required to be so withheld and paid
under all applicable laws; and (xi) none of the Acquired Assets is an interest in any joint
venture, partnership, or other entity, arrangement, or contract that is or could be treated as a
partnership for federal tax purposes.

(h) Neither any Penny Entity nor any RVEP Entity or any Affiliate thereof has (i) sold,
transferred, leased, exchanged, alienated or otherwise disposed of any Collateral or any material
interest therein, or discounted, sold, pledged or assigned any notes payable to any Penny Entity,
accounts receivable or future income of any Penny Entity, except (1) equipment owned by a Penny
Entity that was worthless or obsolete or which was replaced by equipment of equal suitability and
value, and (2) inventory owned by a Penny Entity that was sold in the ordinary course of business
on ordinary trade terms, or (ii) created any mortgage or deed of trust lien or security interest in
any Collateral (except for those arising under the Security Documents). Rio Vista Operating has
not sold, transferred, leased, exchanged, alienated or otherwise disposed of any licenses, leases,
permits or other assets necessary for the operations of the oil and gas properties owned by the
Penny Entities.

For the avoidance of doubt and notwithstanding any other provision of this Section 4, no RVEP
Entity is making any representation or warranty with respect to whether (a) any of the assets of
the Penny Entities or Rio Vista Operating is useful for any particular purpose, (b) any of such
assets has been maintained in accordance with prudent industry standards, or (c) any of such assets
is in good condition or repair.=

SECTION V. TAX MATTERS

5.1. Allocation. The Agreed Asset Value represents the amount agreed upon by the RVEP
Entities and TCW Blocker to be the aggregate fair market value of the Acquired Assets. On or
before the date of this Agreement, the RVEP Entities and TCW Blocker shall agree in writing as to
the allocation of the Agreed Asset Value among the Acquired Assets in a manner consistent with
Section 1060 of the Internal Revenue Code and the Treasury Regulations promulgated thereunder (and
any sim=ilar provision of state, local, or foreign law, as appropriate), based upon the fair market
value of such assets (the “Allocation Schedule”). The RVEP Entities and TCW Blocker (or their
applicable Affiliates) shall report the transactions contemplated hereby on all Tax Returns,
including without limitation Form 8594, in a manner consistent with the Allocation Schedule. No
party shall take a position with a tax authority that is inconsistent with the Allocation Schedule.
The Allocation Schedule shall be attached to this Agreement as Exhibit E.

 

8

 

5.2. Transfer Taxes. To the best knowledge of each RVEP Entity, no sales, transfer or similar
Tax will be collected from TCW Blocker in connection with the transactions contemplated pursuant to
this Agreement (other than the Asset Foreclosure).

5.3. Tax and Audit Cooperation; Records. The RVEP Entities and TCW Blocker agree to furnish
or cause to be furnished to each other, upon request, as promptly as practicable, such information
and assistance relating to the Penny Entities, Rio Vista Operating, and the Acquired Assets
(including without limitation access to books and records) as is reasonably necessary for the
preparation and filing of all Tax Returns and the preparation of audited financial statements in
accordance with GAAP in connection with matters relating to or affected by the operations of the
Penny Entities prior to the Equity Foreclosure Date or Rio Vista Operating prior to the Rio Vista
Operating Assignment Date, including without limitation the making of any election relating to
Taxes, the preparation for any audit by any taxing authority, the making of any voluntary
disclosures, and the prosecution or defense of any claim, suit or proceeding relating to any Tax.
Notwithstanding anything to the contrary herein, the RVEP Entities and TCW Blocker shall retain all
books and records with respect to Taxes pertaining to the Penny Entities, Rio Vista Operating, or
the Acquired Assets for a period of at least six (6) years following the date of this Agreement.

faauto

SECTION VI. CONDITIONS OF EFFECTIVENESS

This Agreement shall become effective upon the receipt by Administrative Agent of counterparts
of this Agreement originally executed and delivered by each applicable party hereto and in such
numbers as Administrative Agent or its counsel may reasonably request.

SECTION VII. MISCELLANEOUS EFFECT AND CONSTRUCTION OF AGREEMENT

7.1. Reviewed by Attorneys. Each RVEP Entity represents and warrants to Administrative Agent
and each Holder that it (a) understands fully the terms of this Agreement and the consequences of
the execution and delivery hereof, (b) has been afforded an opportunity to have this Agreement
reviewed by, and to discuss this Agreement with, such attorneys and other persons as Company m=ay
wish, and (c) has entered into this Agreement of its own free will and accord and without threat,
duress or other coercion of any kind by any Person. The parties hereto acknowledge and agree that
neither this Agreement shall not be construed more favorably in favor of one than the other based
upon which party drafted the same, it being acknowledged that all parties hereto contributed
substantially to the negotiation and preparation of this Agreement.

 

9

 

7.2. Releases. 

(A)  To induce Holder Parties to enter into this Agreement, each RVEP Entity
hereby (i) represents and warrants that as of the date of this Agreement (1) none of the TCW
Released Claims has been assigned, transferred, or sold to any third party and (2) there are no
claims or offsets against or defenses or counterclaims to its obligations under the Note Documents,
and waives any and all such claims, offsets, defenses, or counterclaims, whether known or unknown,
arising prior to the date of this Agreement=b0, (ii) releases and forever discharges the
TCW Released Persons from any and all TCW Released Claims, and (iii) covenants not to assert (and
not to assist or enable any other Person to assert) any TCW Released Claim against any TCW Released
Person. The RVEP Entities acknowledge and agree that such release is a general release of any and
all TCW Released Claims that constitutes a full and complete satisfaction for all or any alleged
injuries or damages arising out of or in connection with the TCW Released Claims, all of which are
herein compromised and settled. 

(B)  To induce the RVEP Entities to enter into this Agreement, each of
Administrative Agent, Holder, and Warrant Owner hereby (a) represents and warrants that as of the
date of this Agreement (1) none of the RVEP Released Claims has been assigned, transferred, or sold
to any third party and (2)there are no claims or offsets against or defenses or counterclaims to
its obligations under the Note Documents, and waives any and all such claims, offsets, defenses, or
counterclaims, whether known or unknown, arising prior to the date of this Agreement, (b) releases
and forever discharges the RVEP Released Persons from any and all RVEP Released Claims, and (c)
covenants not to assert (and not to assist or enable any other Person to assert) any RVEP Released
Claim against any RVEP Released Person. Each of Administrative Agent, Holder, and Warrant Owner
acknowledges and agrees that such release is a general release of any and all RVEP Released Claims
that constitutes a full and complete satisfaction =for all or any alleged injuries or damages
arising out of or in connection with the RVEP Released Claims, all of which are herein compromised
and settled. 

 

10

 

(C) Each party to this Agreement hereby agrees that (i) any and all indebtedness
or other liabilities or obligations for the payment of money owing by Rio Vista Operating or any
Penny Entity to Parent or any other Subsidiary or Affiliate of Parent is hereby terminated and
canceled, and (ii) any and all indebtedness or other liabilities or obligations for the payment of
money owing by Parent or any Subsidiary or Affiliate of Parent (other than Rio Vista Operating and
the Penny Entities) to Rio Vista Operating or any Penny Entity is hereby terminated and
canceled.

(D) = Notwithstanding anything that may be to the contrary in this Agreement, the
Excluded Obligations are not released or terminated hereby and remain in full force and
effect.

7.3. Entire Agreement. This Agreement sets forth the entire agreement among the parties
hereto with respect to the subject matter hereof. Company has not received or relied on any
agreements, representations, or warranties of Administrative Agent, Holder, Warrant Owner, or
Holders, except as specifically set forth herein. Company acknowledges that it is not relying upon
oral representations or statements inconsistent with the terms and provisions of this Agreement.
All of the various representations, warranties, covenants and agreements in this Agreement or in
the various Exhibits to this Agreement that are executed and delivered pursuant to this Agreement
shall survive the execution and delivery= of this Agreement and such other agreements and the
performance hereof and thereof.

7.4. Note Document. This Agreement is a Note Document, and all provisions in the Note
Purchase Agreement pertaining to Note Documents apply hereto and thereto.

7.5. Severability. In case any provision in or obligation hereunder or any shall be invalid,
illegal or unenforceable in any jurisdiction, the validity, legality and enforceability of the
remaining provisions or obligations, or of such provision or obligation in any other jurisdiction,
shall not in any way be affected or impaired thereby.

7.6. Headings. Section headings herein are included herein for convenience of reference only
and shall not constitute a part hereof for any other purpose or be given any substantive effect.

7.7. Applicable Law. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER
SHAL=L BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE
STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES THEREOF.

 

11

 

7.8. Counterparts. This Agreement may be executed in any number of counterparts, each of
which when so executed and delivered shall be deemed an original, but all such counterparts
together shall constitute but one and the same instrument. This Agreement may be validly executed
by facsimile or other electronic transmission.

[The remainder of this page has been intentionally left blank.]

 

12

 

IN WITNESS WHEREOF, the parties heret=o have caused this Agreement to be duly executed and
delivered by their respective officers thereunto duly authorized as of the date first written
above.

	 	 	 	 	 	 	 	 	 
	 	 	RIO VISTA ENERGY PARTNERS L.P.	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Rio Vista GP LLC, its sole general partner	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 
	 

	 	 	 	 	 	 

Ian Bothwell
	 	 
	 

	 	 	 	 	 	Manager and acting CEO	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	RIO VISTA ECO LLC	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	Ian Bothwell	 	 
	 	 	 	 	Manager	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	TCW ASSET MANAGEMENT COMPANY,	 	 
	 	 	as Administrative Agent	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	Patrick Hickey	 	 
	 	 	 	 	Senior Vice President	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	Curt S. Taylor	 	 
	 	 	 	 	Senior Vice Pre=sident	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	TCW ENERGY X BLOCKER (RIO VISTA), L.L.C., 	 	 
	 	 	as Holder and as Warrant Owner	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	TCW Asset Management Company, as	 	 
	 	 	 	 	Manager	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 
	 

	 	 	 	 	 	 

Patrick Hickey
	 	 
	 

	 	 	 	 	 	Senior Vice President	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 
	 

	 	 	 	 	 	 

Curt S. Taylor
	 	 
	 

	 	 	 	 	 	Senior Vice President	 	 

[Settlement Agreement]

 

 

 

Each of the following entities hereby joins this Agreement in order to evidence its agreement
to the provisions of Section 7.2. All of the other signatories to this Agreement hereby consent to
Ian Bothwell’s binding signing on behalf of the entities listed below.

	 	 	 	 	 	 	 
	 	 	RIO VISTA PENNY=RSID6302100 LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Ian Bothwell
	 	  
	 

	 	 	 	Manager	 	 
	 
	 	 	 	 	 	 
	 	 	RIO VISTA GO LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Ian Bothwell
	 	  
	 

	 	 	 	Manager	 	 
	 
	 	 	 	 	 	 
	 	 	GO, LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Ian Bothwell
	 	 
	 

	 	 	 	Manager	 	 
	 
	 	 	 	 	 	 
	 	 	MV PIPELINE COMPANY	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Ian Bothwell
	 	 
	 

	 	 	 	President	 	 
	 
	 	 	 	 	 	 
	 	 	RIO VISTA OPERATING LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Ian Bothwell
	 	 
	 

	 	 	 	Manager	 	 

[Settlement Agreement]

 

 

 

EXHIBIT A

REGISTRATION RIGHTS AGREEMENT

	 	 	 	 	 
	=o
	 	Exhibit A
	 	[Settlement Agreement]

 

 

 

=033EXHIBIT B

RIO VISTA OPERATING ASSIGNMENT

	 	 	 	 	 
	  
	 	Exhibit B
	 	[Settlement Agreement]

 

 

 

EXHIBIT C

WARRANT ASSIGNMENT

	 	 	 	 	 
	  
	 	Exhibit C
	 	[Settlement Agreement]

 

 

 

EXHIBIT D

CERTIFICATION OF NON-FOREIGN STATUS

Section 1445 of the Internal Revenue Code of 1986, as amended (the “Code”), provides that a
transferee of a U.S. real property interest must withhold tax if the transferor is a foreign
person. For U.S. tax purposes (including dbchwithout limitation Section 1445), the owner of a
disregarded entity (which has legal title to a U.S. real property interest under local law) will be
the transferor of the property and not the disregarded entity. To inform TCW Energy X Blocker (Rio
Vista), L.L.C. that withholding of tax is not required upon the disposition of a U.S. real
property interest by Rio Vista Energy Partners L.P. in connection with the transactions
contemplated by that certain Settlement Agreement dated as of May 27, 2009, the undersigned hereby
certifies the following on behalf of Rio Vista Energy Partners L.P.:

1. =angfenp1033 Rio Vista Energy Partners L.P. is not a foreign corporation, foreign
partnership, foreign trust or foreign estate (as those terms are defined in the Code and the
Treasury Regulations);

2. Rio Vista Energy Partners L.P. is not a disregarded entity as defined in Treasury
Regulations Section 1.1445-2(b)(2)(iii);

3. Rio Vista Energy Partners L.P.’s U.S. employer identification number is 20-0153267;
and

4. Rio Vista Energy Partners L.P.’s office address is 1313 E. Alton Gloor Blvd., Suite
J, Brownsville, Texas 77526.

Rio Vista Energy Partners L.P. understands that this certification may be disclosed to the
Internal Revenue Service by = TCW Energy X Blocker (Rio Vista), L.L.C. and that any false statement
contained herein could be punished by fine, imprisonment, or both.

Under penalties of perjury, the undersigned officer hereby declares that he has examined this
certification and, to the best of his knowledge and belief, it is true, correct and complete, and
the undersigned officer further declares that he has authority to sign this certification on behalf
of Rio Vista Energy Partners L.P.

Dated May 27, 2009

	 	 	 	 	 
	=ap0
	 	Exhibit D
	 	[Settlement Agreement]

 

 

 

	 	 	 	 	 	 	 	 	 
	 	 	RIO VISTA ENERGY PARTNERS L.P.	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Rio Vista GP LLC, its sole general partner	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 
	 

	 	 	 	 	 	 

Ian Bothwell
	 	 
	 

	 	 	 	 	 	Treasurer, Chief Financial Officer and	 	 
	 

	 	 	 	 	 	=rsid12527079 Principal Accounting Officer	 	 

	 	 	 	 	 
	 	 	 	 	 
	 
	 	Exhibit E-2
	 	[Settlement Agreement]

 

 

 

EXHIBIT E

ALLOCATION SCHEDULE

The RVEP Entities and TCW Blocker agree that the Agreed Asset Value shall be allocated among
the Acquired Assets for federal income tax and accounting purposes using the residual method in
accordance with Section 1060 of the Internal Revenue Code and the Treasury Regulations thereunder
as set forth below. The class references are in accordance with Sections 1.338-6 and 1.1060-1 of
the Treasury Regulations.

	 	 	 	 	 	 	 	 	 
	ltrparAsset Class:
	 	Acquired Assets:
	 	Allocation based on fair market value (“FMV”) (determined as follows):
	 	Allocation based on FMV:

	 
	 	 	 	 	 	 	 	 
	Class I

	 	Cash

Cash Equivalents
	 	FMV = The value reflected for such assets on Company’s, GO’s,
GO LLC’s, and Rio Vista Operating’s balance sheets as of the
Equity Foreclosure Date and the Rio Vista Operating Assignment
Date, whichever the case may be
	 	=	h$100,000	 
	 
	 	 	 	 	 	 	 	 
	Class II

	 	Actively Traded Securities
	 	FMV = The trading price of such assets on the Equity
Foreclosure Date and the Rio Vista Operating Assignment Date,
whichever the case may be
	 	$	0	 
	 
	 	 	 	 	 	 	 	 
	Class III

	 	Accounts Receivable

Other Mark-to-Market Assets

Debt Instruments
	 	FMV = The book value reflected for such assets on Company’s,
GO’s, GO LLC’s, and Rio Vista Operating’s balance sheets as of
the Equity Foreclosure Date and the Rio Vista Operating
Assignment Date, whichever the case may be
	 	$	500,000	 
	 
	 	 	 	 	 	 	 	 
	=9 Class IV

	 	Inventory
	 	FMV = The book value reflected for such inventory on Company’s,
GO’s, GO LLC’s, and Rio Vista Operating’s balance sheets as of
the Equity Foreclosure Date and the Rio Vista Operating
Assignment Date, whichever the case may be
	 	$	0	 
	 
	 	 	 	 	 	 	 	 
	Class V

	 	Furniture

Fixtures

Equipment

Other Assets not Covered by

Other Classes
	 	=ntblFMV = The value for such assets in the engineering reports
for Company and Rio Vista Operating and, for assets not
included in the engineering reports, the book value reflected
for such assets (including without limitation the stock of MV
Pipeline) on Company’s, GO’s, GO LLC’s and Rio Vista
Operating’s balance sheets as of the Equity Foreclosure Date
and the Rio Vista Operating Assignment Date, whichever the case
may be
	 	$	11,400,000	 

	 	 	 	 	 
	 	 	 	 	 
	 
	 	Exhibit E-2
	 	[Settlement Agreement]

 

 

 

	 	 	 	 	 	 	 	 	 
	ltrparAsset Class:
	 	Acquired Assets:
	 	Allocation based on fair market value (“FMV”) (determined as follows):
	 	Allocation based on FMV:

	 
	 	 	 	 	 	 	 	 
	Class VI

	 	Customer Contracts

Workforce

=07 Other Intangible Assets
Described in Section 197 of
the Internal Revenue Code
(except Goodwill/Going
Concern)
	 	FMV = The book value reflected for such assets on Company’s,
GO’s, GO LLC’s, and Rio Vista Operating’s balance sheets as of
the Equity Foreclosure Date and the Rio Vista Operating
Assignment Date, whichever the case may be
	 	$	0	 
	 
	 	 	 	 	 	 	 	 
	Class VII

	 	Goodwill/Going Concern
	 	FMV = The Agreed Asset Value reduced by the allocation of the
Agreed Asset Value to all other Acquired Assets
	 	$	0	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	Total Agreed Asset Value
	 	$	12,000,000	 

 

	 	 	 
	Note 1: 	 	Company, GO, GO LLC, and Rio Vista Operating are all single-member limited liability
companies disregarded as separate from Parent for federal tax purposes under Section 301.7701-3 of
the Treasury Regulations.= Thus, the acquisition of these entities (pursuant to the Settlement
Agreement) by TCW Blocker is treated as a direct acquisition of the assets (and assumption of the
liabilities) of Company (including without limitation the stock of MV Pipeline), GO, GO LLC, and
Rio Vista Operating. Consequently, the calculation of the Agreed Asset Value and the allocation of
the Agreed Asset Value to the Acquired Assets is with respect to assets held by (and within)
Company, GO, GO LLC, and Rio Vista Operating.

	 
	Note 2: 	 	In accordance with Section 1060 of the Internal Revenue Code, using the residual method,
the Agreed Asset Value is first allocated to any Class I assets transferred by Parent. Any
remaining Agreed Asset Value is then allocated to Class II assets based on their fair market values
on the Equity Foreclosure Date and the Rio Vista Operating Assignment Date, whichever the case may
be, and then, in turn, to Class III, Class IV, Class V, and Class VI assets in the same manner.
Any remaining Agreed Asset Value is considered goodwill or going concern value and allocated to
Class VII. If there are no assets in a particular class, that class is ignored and the next class
is considered. The amount of the Ag=reed Asset Value allocated to an asset, other than a Class VII
asset, cannot exceed its fair market value on the date of transfer.

					
	  
	 	Exhibit E-2
	 	[Settlement Agreement]Exhibit 10.2

Exhibit 10.2

REGISTRATION RIGHTS AGREEMENT

by and between

RIO VISTA ENERGY PARTNERS L.P.

and

TCW ENERGY X BLOCKER (RIO VISTA), L.L.C.

 

1

 

REGISTRATION RIGHTS AGREEMENT

THIS REGISTRATION RIGHTS AGREEMENT (this “Agreement”) is made and entered into as of May 27, 2009, by and between
RIO VISTA ENERGY PARTNERS L.P., a Delaware limited partnership (the “Company”), and TCW ENERGY X BLOCKER (RIO VISTA),
L.L.C., a Delaware limited liability company (“TCW”).

RECITALS:

A. The Company, TCW, Rio Vista Energy ECO LLC, and TCW Asset Management Company have entered into a Settlement
Agreement dated as of May 27, 2009 (the “Settlement Agreement”).

B. Pursuant to the Settlement Agreement, the Company has agreed to provide the registration and other rights set
forth in this Agreement for the benefit of TCW.

AGREEMENT:

NOW THEREFORE, in consideration of the mutual covenants and agreements set forth herein and for good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged by each party hereto, the parties hereby
agree as follows:

ARTICLE I

DEFINITIONS

Section 1.1. Definitions. The terms set forth below are used herein as so defined:

"Affiliate” means, with respect to a specified Person, any other Person, directly or indirectly controlling,
controlled by or under direct or indirect common control with such specified Person. For purposes of this definition,
“control” (including, with correlative meanings, “controlling,” “controlled by” and “under common control with”) means
the power to direct or cause the direction of the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise.

"Affiliate Transfer” means any transfer of Registrable Securities (or the rights granted to TCW by the Company
under this Agreement) from TCW to an Affiliate of TCW and any successive Affiliate Transfers.

"Business Day” means any day other than a Saturday, Sunday, or a legal holiday for commercial banks in Houston,
Texas.

"Commission” means the United States Securities and Exchange Commission.

"Common Units” means the common units of the Company.

"Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations of the
Commission promulgated thereunder.

2

 

2

 

"Indemnified Persons” has the meaning specified in Section 2.6(a).

"Losses” has the meaning specified in Section 2.6(a).

"Person” means any individual, corporation, company, voluntary association, partnership, joint venture, trust,
limited liability company, unincorporated organization, government or any agency, instrumentality or political
subdivision thereof, or any other form of entity.

"Piggyback Registration” has the meaning specified in Section 2.1(a).

"Registrable Securities” means the Common Units, or such other equity securities issued in exchange therefor in
connection with any merger, consolidation or other business combination involving the Company until such time as such
securities cease to be Registrable Securities pursuant to Section 1.2.

"Registration Expenses” has the meaning specified in Section 2.5(a).

"Rule 144” means Rule 144 as promulgated under the Securities Act.

"Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations of the Commission
promulgated thereunder.

"Selling Expenses” has the meaning specified in Section 2.5(a).

"Settlement Agreement” has the meaning specified in the recitals to this Agreement.

"Underwritten Offering” means an offering in which Common Units are sold to an underwriter on a firm commitment
basis for reoffering to the public or an offering that is a “bought deal” with one or more investment banks.

Section 1.2. Registrable Securities. Any Registrable Security will cease to be a Registrable Security
when (a) a registration statement covering such Registrable Security has been declared effective by the Commission and
such Registrable Security has been sold or disposed of pursuant to such effective registration statement; (b) such
Registrable Security has been disposed of pursuant to any section of Rule 144 (or any similar provision then in force
under the Securities Act); (c) such Registrable Security is held by the Company or one of its subsidiaries or (d) such
Registrable Security has been sold in a private transaction in which the transferor’s rights under this Agreement are
not assigned to the transferee of such securities.

3

 

3

 

ARTICLE II

REGISTRATION RIGHTS

Section 2.1. Piggyback Registration.

(a) Right to Piggyback. If, at any time after the date of the Settlement Agreement, the Company proposes
to register any of its securities under the Securities Act in connection with a public offering of such securities
(other than a registration relating solely to the sale of securities to participants in a common unit incentive plan of
the Company, in their capacity as such) and the registration form to be used may be used for the registration of
Registrable Securities (a “Piggyback Registration”), the Company will give prompt written notice (and in any event
within five Business Days after its receipt of notice of any exercise of demand registration rights) to TCW, which
notice shall describe the offering contemplated thereby, of its intention to effect such a registration, and will
include in such registration all Registrable Securities held by TCW (in accordance with the priorities set forth in
Section 2.1(b) below) with respect to which the Company has received written requests for inclusion within 20 days
after the delivery of the Company’s notice.

(b) Allocation and Priority of Registrable Securities in a Piggyback Registration.

(i) Priority on Primary Registrations. If a Piggyback Registration is an underwritten primary
registration on behalf of the Company and the managing underwriters advise the Company in writing that in
their opinion the number of securities requested to be included in the registration creates a substantial risk
that the price per unit of Common Units in the offering will be reduced, the Company will include in such
registration first, the securities that the Company proposes to sell, second, the Registrable
Securities requested to be included in such registration by TCW, and third, pro rata among any other
securities requested to be included in such registration.

(ii) Priority on Secondary Registrations. If a Piggyback Registration is an underwritten
secondary registration on behalf of holders of the Company’s securities and the managing underwriters advise
the Company in writing that in their opinion the number of securities requested to be included in the
registration creates a substantial risk that the price per share of Common Units in the offering will be
reduced, the Company will include in such registration first, the Registrable Securities requested to
be included therein by TCW, second, pro rata among the holders of the Company’s securities on the
basis of the number of units of Common Units or Registrable Securities owned by such holders, with further
successive pro rata allocations among such holders if any such holder has requested the registration of less
than all of the Registrable Securities such holder is entitled to register, and third, other
securities requested to be included in such registration.

Section 2.2. Underwritten Offering.

(a) Underwritten Offering. If, and to the extent that, TCW is unable to participate in a Piggyback
Registration, and TCW elects to otherwise dispose of its Registrable Securities pursuant to an Underwritten Offering,
then the Company shall take all such other reasonable actions as are requested by the managing underwriter in order to
expedite or facilitate the registration and disposition of such Registered Securities in an Underwritten Offering,
provided, that the managing underwriter reasonably anticipates gross proceeds from such Underwritten Offering of at
least $10 million, and provided further, that the Company shall not be required to cause officers of the Company or its
Affiliates to participate in a “road show” or similar marketing effort being conducted by such managing underwriter
with respect to such Underwritten Offering.

4

 

4

 

(b) General Procedures. In connection with an Underwritten Offering, TCW and the Company shall be
obligated to enter into an underwriting agreement which contains such representations, covenants, indemnities and other
rights and obligations as are customary in underwriting agreements for firm commitment offerings of securities. TCW
may not participate in such Underwritten Offering unless it agrees to sell its Registrable Securities on the basis
provided in such underwriting agreement and completes and executes all questionnaires, powers of attorney, indemnities
and other documents reasonably required under the terms of such underwriting agreement. TCW may, at its option,
require that any or all of the representations and warranties by, and the other agreements on the part of, the Company
to and for the benefit of such underwriters also be made to and for TCW’s benefit and that any or all of the conditions
precedent to the obligations of such underwriters under such underwriting agreement also be conditions precedent to its
obligations. TCW shall not be required to make any representations or warranties to or agreements with the Company or
the underwriters other than representations, warranties or agreements regarding TCW and its ownership of the securities
being registered on its behalf and its intended method of distribution and any other representation required by law.
If TCW disapproves of the terms of an underwriting, it may elect to withdraw therefrom by notice to the Company and the
managing underwriter; provided, however, that such withdrawal may be made up to and including the time of pricing of
the Underwritten Offering. No such withdrawal or abandonment shall affect the Company’s obligation to pay Registration
Expenses.

(c) Appointment of Underwriters. In connection with an Underwritten Offering, TCW shall have the sole
right to appoint the managing underwriters.

Section 2.3. Registration Procedures. In connection with its obligations contained in Sections 2.1 and
2.2 hereof, the Company will, as expeditiously as possible:

(a) furnish to TCW (i) as far in advance as reasonably practicable before filing any registration statement
contemplated by this Agreement or any supplement or amendment thereto (excluding documents filed pursuant to the
Exchange Act that are incorporated by reference into any registration statement contemplated by this Agreement or any
supplement or amendment thereto), upon request, copies of reasonably complete drafts of all such documents proposed to
be filed, and provide TCW the opportunity to object to any information pertaining to TCW and its plan of distribution
that is contained therein and make the corrections reasonably requested by TCW with respect to such information prior
to filing such registration statement and the prospectus included therein or any supplement or amendment thereto, and
(ii) such number of copies of such registration statement and the prospectus included therein and any supplements and
amendments thereto as TCW may reasonably request in order to facilitate the public sale or other disposition of the
Registrable Securities covered by such registration statement;

(b) if applicable, use its commercially reasonable efforts to register or qualify the Registrable Securities
covered by any registration statement contemplated by this Agreement under the securities or blue sky laws of such
jurisdictions as TCW or, in the case of an Underwritten Offering, the managing underwriter, shall reasonably request,
provided that the Company will not be required to qualify generally to transact business in any jurisdiction where it
is not then required to so qualify or to take any action which would subject it to general service of process in any
such jurisdiction where it is not then so subject;

5

 

5

 

(c) promptly notify TCW and each underwriter of (i) the filing of any registration statement contemplated by this
Agreement or any prospectus or prospectus supplement to be used in connection therewith, or any amendment or supplement
thereto, and, with respect to such registration statement or any post-effective amendment thereto, when the same has
become effective; and (ii) any written comments from the Commission with respect to any filing referred to in
clause (i) and any written request by the Commission for amendments or supplements to the registration
statement or any prospectus or prospectus supplement thereto;

(d) immediately notify TCW and each underwriter, at any time when a prospectus relating thereto is required to be
delivered under the Securities Act, of (i) the happening of any event as a result of which the prospectus or prospectus
supplement contained in any registration statement contemplated by this Agreement, as then in effect, includes an
untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary to
make the statements therein not misleading in the light of the circumstances then existing, provided, however, that the
Company shall not be required to specify in the written notice to TCW the nature of such event; (ii) the issuance or
threat of issuance by the Commission of any stop order suspending the effectiveness of any registration statement
contemplated by this Agreement, or the initiation of any proceedings for that purpose; or (iii) the receipt by the
Company of any notification with respect to the suspension of the qualification of any Registrable Securities for sale
under the applicable securities or blue sky laws of any jurisdiction; following the provision of such notice, the
Company agrees to as promptly as practicable amend or supplement the prospectus or prospectus supplement or take other
appropriate action so that the prospectus or prospectus supplement does not include an 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 in the light of the circumstances then existing and to take such other action as is necessary to remove such
stop order, suspension, threat thereof or proceedings related thereto;

(e) furnish to TCW copies of any and all transmittal letters or other correspondence with the Commission or any
other governmental agency or self-regulatory body or other body having jurisdiction (including any domestic or foreign
securities exchange) relating to such offering of Registrable Securities;

(f) in the case of an Underwritten Offering, furnish upon request, (i) an opinion of counsel for the Company,
dated the effective date of the applicable registration statement or the date of any amendment or supplement thereto,
and an opinion in customary form dated the date of the closing of the Underwritten Offering, and (ii) a “cold comfort”
letter or letters, dated the date of execution of the underwriting agreement and a letter or letters of like kind dated
the date of the closing of the Underwritten Offering, in each case, signed by the independent public accountants who
have certified the financial statements included or incorporated by reference into the applicable registration
statement, and each of the opinion and the “cold comfort” letter or letters shall be in customary form and covering
substantially the same matters with respect to such registration statement (and the prospectus and any prospectus
supplement included therein) and as are customarily covered in opinions of issuer’s counsel and in accountants’ letters
delivered to the underwriters in Underwritten Offerings of securities, such other matters as such underwriters may
reasonably request;

6

 

6

 

(g) otherwise use its commercially reasonable efforts to comply with all applicable rules and regulations of the
Commission, and make generally available to its security holders (or otherwise provide in accordance with Section 11(a)
of the Securities Act) an earnings statement satisfying the provisions of Section 11(a) of the Securities Act in
accordance with Rule 158 thereunder (or any similar rule promulgated under the Securities Act) or otherwise;

(h) make available to the appropriate representatives of the managing underwriter and TCW access to such
information and personnel as is reasonable and customary to enable such parties to establish a due diligence defense
under the Securities Act; provided that the Company need not disclose any information to any such representative unless
and until such representative has entered into a confidentiality agreement with the Company;

(i) cause all such Registrable Securities registered pursuant to this Agreement to be listed on each securities
exchange or nationally recognized quotation system on which similar securities issued by the Company are then listed;

(j) use its commercially reasonable efforts to cause the Registrable Securities to be registered with or approved
by such other governmental agencies or authorities as may be necessary by virtue of the business and operations of the
Company to enable TCW to consummate the disposition of such Registrable Securities;

(k) provide a transfer agent and registrar for all Registrable Securities covered by such registration statement
not later than the effective date of such registration statement; and

(l) enter into customary agreements and take such other actions as are reasonably requested by TCW or the
underwriters, if any, in order to expedite or facilitate the disposition of such Registrable Securities.

TCW, upon receipt of notice from the Company of the happening of any event of the kind described in Section
2.3(d), shall forthwith discontinue disposition of the Registrable Securities until TCW’s receipt of the copies of
the supplemented or amended prospectus contemplated by Section 2.3(d) or until it is advised in writing by the
Company that the use of the prospectus may be resumed, and has received copies of any additional or supplemental
filings incorporated by reference in the prospectus, and, if so directed by the Company, TCW will, or will request the
managing underwriter or underwriters, if any, to deliver to the Company (at the Company’s expense) all copies in their
possession or control, other than permanent file copies then in TCW’s possession, of the prospectus and any prospectus
supplement covering such Registrable Securities current at the time of receipt of such notice.

Section 2.4. Cooperation by TCW. The Company shall have no obligation to include in any Piggyback
Registration Registrable Securities held by TCW if TCW has failed to timely furnish such information which, in the
opinion of counsel to the Company, is reasonably required in order for the registration statement or prospectus
supplement, as applicable, to comply with the Securities Act.

7

 

7

 

Section 2.5. Expenses.

(a) Certain Definitions. “Registration Expenses” means all expenses incident to the Company’s performance
under or compliance with this Agreement to effect the registration of Registrable Securities in a Piggyback
Registration pursuant to Section 2.1 or an Underwritten Offering pursuant to Section 2.2, and the
disposition of such securities, including, without limitation, all registration, filing, securities exchange listing
and quotation system fees, all registration, filing, qualification and other fees and expenses of complying with
securities or blue sky laws, fees of the National Association of Securities Dealers, Inc., transfer taxes and fees of
transfer agents and registrars, all word processing, duplicating and printing expenses, the fees and disbursements of
counsel and independent public accountants for the Company, including the expenses of any special audits or “cold
comfort” letters required by or incident to such performance and compliance. In addition, “Selling Expenses” means all
underwriting fees, discounts and selling commissions allocable to the sale of the Registrable Securities.

(b) Expenses. The Company will pay all Registration Expenses in connection with a Piggyback Registration
pursuant to Section 2.1 or an Underwritten Offering pursuant to Section 2.2, whether or not the
applicable registration statement becomes effective or any sale is made pursuant to a Piggyback Registration or an
Underwritten Offering. TCW shall pay all Selling Expenses in connection with any sale of its Registrable Securities
pursuant to this Agreement.

Section 2.6. Indemnification. 

(a) By the Company. In the event of a registration of any Registrable Securities under the Securities Act
pursuant to this Agreement, the Company will indemnify and hold harmless TCW, its Affiliates and their respective
directors and officers, and each underwriter, pursuant to the applicable underwriting agreement with such underwriter,
of Registrable Securities thereunder and each Person, if any, who controls TCW or underwriter within the meaning of the
Securities Act and the Exchange Act (collectively, the “Indemnified Persons”), against any losses, claims, damages,
expenses or liabilities (including reasonable attorneys’ fees and expenses) (collectively, “Losses”), joint or several,
to which such Indemnified Person may become subject under the Securities Act, the Exchange Act or otherwise, insofar as
such Losses (or actions or proceedings, whether commenced or threatened, in respect thereof) arise out of or are based
upon any untrue statement or alleged untrue statement of any material fact contained in any registration statement
contemplated by this Agreement, any preliminary prospectus or final prospectus contained therein, or any amendment or
supplement thereof, or arise out of or are based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein (in the case of a prospectus, in the light of
the circumstances under which they were made) not misleading, and will reimburse each such Indemnified Person for any
legal or other expenses reasonably incurred by them in connection with investigating or defending any such Loss or
actions or proceedings within a reasonable time after such expenses are incurred and the Indemnified Person notifies
the Company of such expenses; provided, however, that the Company will not be liable in any such case if and to the
extent that any such Loss arises out of or is based upon an untrue statement or alleged untrue statement or omission or
alleged omission so made in conformity with information furnished by such Indemnified Person in writing specifically
for use in any registration statement or prospectus supplement, as applicable. Such indemnity shall remain in full
force and effect regardless of any investigation made by or on behalf of such Indemnified Person, and shall survive the
transfer of such securities by TCW.

8

 

8

 

(b) By TCW. TCW agrees to indemnify and hold harmless the Company, its Affiliates and their respective
directors and officers, and each Person, if any, who controls the Company within the meaning of the Securities Act or
of the Exchange Act to the same extent as the foregoing indemnity from the Company to TCW, but only with respect to
information regarding TCW furnished in writing by or on behalf of TCW expressly for inclusion in any registration
statement or prospectus supplement relating to the Registrable Securities, or any amendment or supplement thereto;
provided, however, that the liability of TCW shall not be greater in amount than the dollar amount of the proceeds (net
of any Selling Expenses) received by TCW from the sale of the Registrable Securities giving rise to such
indemnification.

(c) Notice. Promptly after receipt by an indemnified party hereunder of notice of the commencement of any
action, such indemnified party shall, if a claim in respect thereof is to be made against the indemnifying party
hereunder, notify the indemnifying party in writing thereof; provided, however, that the failure to notify the
indemnifying party shall not relieve it from any liability that it may have under this Section 2.6 except to
the extent that it has been materially prejudiced by such failure and, provided, further, that the failure to notify
the indemnifying party shall not relieve it from any liability which it may have to any indemnified party other than
under this Section 2.6. The indemnifying party shall be entitled to participate in and, to the extent it shall
wish, to assume and undertake the defense thereof with counsel reasonably satisfactory to such indemnified party and,
after notice from the indemnifying party to such indemnified party of its election so to assume and undertake the
defense thereof, the indemnifying party shall not be liable to such indemnified party under this Section 2.6
for any legal expenses subsequently incurred by such indemnified party in connection with the defense thereof other
than reasonable costs of investigation and of liaison with counsel so selected; provided, however, that, (i) if the
indemnifying party has failed to assume the defense and employ counsel or (ii) if the defendants in any such action
include both the indemnified party and the indemnifying party and counsel to the indemnified party shall have concluded
that there may be reasonable defenses available to the indemnified party that are different from or additional to those
available to the indemnifying party, or if the interests of the indemnified party reasonably may be deemed to conflict
with the interests of the indemnifying party, then the indemnified party shall have the right to select a separate
counsel and to assume such legal defense and otherwise to participate in the defense of such action, with the
reasonable expenses and fees of such separate counsel and other reasonable expenses related to such participation to be
reimbursed by the indemnifying party as incurred. Notwithstanding any other provision of this Agreement, no
indemnified party shall settle any action brought against it with respect to which it is entitled to indemnification
hereunder without the consent of the indemnifying party, unless the settlement thereof imposes no liability or
obligation on, and includes a complete and unconditional release from all liability of, the indemnifying party and does
not contain any admission of wrongdoing or illegal activity by the indemnified party.

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(d) Contribution. If the indemnification provided for in this Section 2.6 is held by a court or
government agency of competent jurisdiction to be unavailable to the Company or TCW or is insufficient to hold them
harmless in respect of any Losses, then each such indemnifying party, in lieu of indemnifying such indemnified party,
shall contribute to the amount paid or payable by such indemnified party as a result of such Losses, in such proportion
as is appropriate to reflect the relative fault of the Company on the one hand and of TCW on the other in connection
with the statements or omissions which resulted in such Losses, as well as any other relevant equitable considerations;
provided, however, that in no event shall TCW be required to contribute an aggregate amount in excess of the dollar
amount of proceeds (net of Selling Expenses) received by TCW from the sale of Registrable Securities giving rise to
such indemnification. The relative fault of the Company on the one hand and TCW on the other shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact has been made by, or relates to, information supplied by such party, and the
parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or
omission. The parties hereto agree that it would not be just and equitable if contributions pursuant to this paragraph
were to be determined by pro rata allocation or by any other method of allocation which does not take account of the
equitable considerations referred to above. The amount paid by an indemnified party as a result of the Losses referred
to in the first sentence of this paragraph shall be deemed to include any legal and other expenses reasonably incurred
by such indemnified party in connection with investigating or defending any Loss which is the subject of this
paragraph. No Person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities
Act) shall be entitled to contribution from any Person who is not guilty of such fraudulent misrepresentation.

(e) Other Indemnification. The provisions of this Section 2.6 shall be in addition to any other
rights to indemnification or contribution which an indemnified party may have pursuant to law, equity, contract or
otherwise.

Section 2.7. Rule 144 Reporting. With a view to making available the benefits of certain rules and
regulations of the Commission that may permit the sale of the Registrable Securities to the public without
registration, the Company agrees to use its commercially reasonable efforts to:

(a) Make and keep public information regarding the Company available, as those terms are understood and defined in
Rule 144 of the Securities Act;

(b) File with the Commission in a timely manner all reports and other documents required of the Company under the
Securities Act and the Exchange Act; and

(c) So long as TCW owns any Registrable Securities, furnish to TCW forthwith upon request a copy of the most
recent annual or quarterly report of the Company, and such other reports and documents so filed as TCW may reasonably
request in availing itself of any rule or regulation of the Commission allowing TCW to sell any such securities without
registration.

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ARTICLE III

MISCELLANEOUS 

Section 3.1. Communications. All notices and other communications provided for or permitted hereunder
shall be made in writing by facsimile, courier service or personal delivery:

if to TCW, at the most current address given by TCW to the Company in accordance with the provisions of this
Section 3.1, which address initially is c/o TCW Asset Management Company, 865 South Figueroa Street,
Suite 1800, Los Angeles, California 90017, Attention: R. Blair Thomas, Facsimile: (213) 244-0604, with a
copy to TCW Asset Management Company, 333 Clay Street, Suite 4150, Houston, Texas 77002, Attention: Patrick
Hickey, Facsimile: (713) 615-7460.

if to a permitted transferee of TCW, to such permitted transferee at the address furnished by such permitted
transferee, and

if to the Company, at 1313 E. Alton Gloor Blvd., Suite J, Brownsville, Texas 78526.

All such notices and communications shall be deemed to have been received at the time delivered by hand, if
personally delivered; when receipt acknowledged, if sent via facsimile; and when actually received, if sent by any
other means.

Section 3.2. Successor and Assigns. This Agreement shall inure to the benefit of and be binding upon the
successors and assigns of each of the parties, including subsequent holders of Registrable Securities to the extent
permitted herein.

Section 3.3. Transfer or Assignment of Registration Rights. The rights granted to TCW by the Company
under this Agreement may be transferred or assigned by TCW to one or more transferee(s) or assignee(s) of such
Registrable Securities, provided that (x) the Company is given written notice prior to any said transfer or assignment,
stating the name and address of each such transferee and identifying the securities with respect to which such
registration rights are being transferred or assigned, and (y) each such transferee assumes in writing responsibility
for its portion of the obligations of TCW under this Agreement; and provided further, that the requirements in this
Section 3.3 shall not apply to an Affiliate Transfer.

Section 3.4. Recapitalization, Exchanges, etc. Affecting the Common Units. The provisions of this
Agreement shall apply to the full extent set forth herein with respect to any and all Common Units or other partnership
interests of the Company or any successor or assign of the Company (whether by merger, consolidation, sale of assets or
otherwise) which may be issued in respect of, in exchange for or in substitution of, the Registrable Securities,
including any common units or other equity securities that may be issued in exchange for Registrable Securities in
connection with any merger, consolidation or other business combination involving the Company, and shall be
appropriately adjusted for combinations, recapitalizations and the like occurring after the date of this Agreement.
The Company shall not merge, consolidate or combine with any other Person unless the agreement providing for such
merger, consolidation or combination expressly provides for the continuation of the registration rights specified in
this Agreement with respect to the Common Units or other equity securities issued pursuant to such merger,
consolidation or combination.

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Section 3.5. Specific Performance. Damages in the event of breach of this Agreement by a party hereto may
be difficult, if not impossible, to ascertain, and it is therefore agreed that each such Person, in addition to and
without limiting any other remedy or right it may have, will have the right to an injunction or other equitable relief,
including specific performance, in any court of competent jurisdiction, enjoining any such breach, and enforcing
specifically the terms and provisions hereof, and each of the parties hereto hereby waives any and all defenses it may
have on the ground of lack of jurisdiction or competence of the court to grant such an injunction or other equitable
relief. The existence of this right will not preclude any such Person from pursuing any other rights and remedies at
law or in equity which such Person may have.

Section 3.6. Counterparts. This Agreement may be executed in any number of counterparts and by different
parties hereto in separate counterparts, each of which counterparts, when so executed and delivered, shall be deemed to
be an original and all of which counterparts, taken together, shall constitute but one and the same Agreement.

Section 3.7. Headings. The headings in this Agreement are for convenience of reference only and shall not
limit or otherwise affect the meaning hereof.

Section 3.8. Governing Law. The laws of the State of New York shall govern this Agreement without regard
to principles of conflict of laws.

Section 3.9. Severability of Provisions. Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof or affecting or impairing the validity or
enforceability of such provision in any other jurisdiction.

Section 3.10. Entire Agreement. This Agreement is intended by the parties as a final expression of their
agreement and intended to be a complete and exclusive statement of the agreement and understanding of the parties
hereto in respect of the subject matter contained herein. There are no restrictions, promises, warranties or
undertakings, other than those set forth or referred to herein with respect to the rights granted by the Company set
forth herein. This Agreement supersedes all prior agreements and understandings between the parties with respect to
such subject matter.

Section 3.11. Amendment. This Agreement may be amended only by means of a written amendment signed by the
Company and TCW.

Section 3.12. No Presumption. In the event any claim is made by a party relating to any conflict,
omission, or ambiguity in this Agreement, no presumption or burden of proof or persuasion shall be implied by virtue of
the fact that this Agreement was prepared by or at the request of a particular party or its counsel.

[The remainder of this page is intentionally left blank.]

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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.

RIO VISTA ENERGY PARTNERS L.P.

By: Rio Vista GP LLC, its sole general partner

By:                                                                                         

Name: Ian Bothwell

Title: Manager and Acting CEO

TCW ENERGY X BLOCKER (RIO VISTA), L.L.C.

By: TCW Asset Management Company, as Manager

By:                                                                                         

Name: Curt S. Taylor

Title: Senior Vice President

By:                                                                                         

Name: Patrick H. Hickey

Title: Senior Vice President

SIGNATURE PAGE—REGISTRATION RIGHTS AGREEMENT

 

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