Attached files
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EX-10.1 - PENN OCTANE CORP | v204543_ex10-1.htm |
EX-10.3 - PENN OCTANE CORP | v204543_ex10-3.htm |
EX-10.2 - PENN OCTANE CORP | v204543_ex10-2.htm |
EX-10.4 - PENN OCTANE CORP | v204543_ex10-4.htm |
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date
of Report (Date of earliest event reported): November 17, 2010
Penn
Octane Corporation
(Exact name of registrant as specified
in its charter)
Delaware
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000-24394
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52-1790357
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(State
or other Jurisdiction of Incorporation)
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(Commission
File Number)
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(IRS
Employer Identification No.)
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2121
Rosecrans Ave, Suite 3355
El
Segundo, California
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90245
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(Address
of Principal Executive Offices)
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(Zip
Code)
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Registrant’s
telephone number, including area code: (310) 563-1828
77-530
Enfield Lane, Bldg D
Palm
Desert, CA 92211
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(Former
name or former address if changed since last
report.)
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Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
o
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Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
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o
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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o
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
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o
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
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On
November 17, 2010, Penn Octane Corporation (“Penn Octane”), Rio Vista Energy
Partners L.P. (“Rio Vista”) and Central Energy, LP, a Delaware limited
partnership (as successor by assignment to Central Energy, LLC) (“Central
Energy”) entered into a Fourth Amendment to Securities Purchase and Sale
Agreement (the “Fourth Amendment”), amending the Securities Purchase and Sale
Agreement dated May 25, 2010 (as amended, the “Agreement”)
in connection with the closing of the transactions contemplated under the
Agreement (the “Closing”) (see Item 2.01 below). The Closing occurred
on November 17, 2010, simultaneously with the entry by Penn Octane into the
Fourth Amendment. The material terms of the Agreement (prior to the
Fourth Amendment) are disclosed in Form 8-K filed by Penn Octane with the
Securities and Exchange Commission on May 28, 2010. Under the terms
of the Fourth Amendment, the $3,950,291 cash purchase price for 12,724,019
common units in Rio Vista issued and sold to Central Energy at the Closing was
adjusted to permit payment of $1.0 million of such purchase price in the form of
a nine-month secured promissory note from Central to Rio Vista
(“Note”). However, at the Closing, the Note was paid in full at the
Closing and immediately cancelled. Under the terms of the Fourth
Amendment, Rio Vista also agreed to grant piggy back registration rights with
respect to the common units in Rio Vista held by Penn Octane at the time of
Closing.
In
connection with the Closing, the following additional agreements dated as of
November 17, 2010 were entered into:
a. Mutual
Release by and among Penn Octane and Rio Vista and GP.
b. Release
Agreement between Central Energy, Rio Vista and GP and the RVEP
Insiders.
A copy of
the above referenced agreements are included as exhibits to this Form 8-K and
are incorporated by reference into this Item 1.01. The foregoing summary of
certain provisions of these documents are qualified in their entirety by
reference thereto.
Item 1.02. Termination
of a Material Definitive Agreement
In
connection with the Closing as described in Item 2.01 of this Current Report,
the Omnibus Agreement dated as of September 16, 2004 among Penn Octane, GP, Rio Vista and Rio
Vista Operating Partnership, L.P., a Delaware limited
partnership (as amended, the “Omnibus
Agreement”) was terminated effective
immediately upon the Closing. The Omnibus Agreement was originally
entered to ensure the continued operation of the business of Penn Octane and its
affiliates (the “Business”) following the
formation of Rio Vista and GP, pursuant to which Penn Octane agreed to provide,
inter alia, the
employees, corporate staff, support services and administrative services
necessary to operate the Business. Upon the Closing and the sale by
Penn Octane of its ownership interest in GP, and in view of the limited
operations of GP, Rio Vista or its subsidiaries, the parties agreed to terminate
the Omnibus Agreement effective upon the Closing.
Item
2.01 Completion of Acquisition or Disposition of Assets.
On
November 17, 2010, Penn Octane, Rio Vista and Central Energy completed the
transactions associated with the Agreement at the Closing. Pursuant
to the terms of the Agreement, Penn Octane sold or caused to be sold all of the
interests in GP, the general partner of Rio Vista and Rio Vista sold to Central
Energy 12,724,019 newly issued Common Units of Rio Vista (the “Common Units”),
which Common Units, represent approximately 80% of the Common Units of Rio Vista
on a fully diluted basis. The purchase price for the sale of 100% of
the limited liability company interests in the GP was $149,709, which amount was
contributed by Penn Octane to the GP and then by the GP to Rio Vista
simultaneously with the Closing under the Agreement. The purchase
price for the sale of the Common Units was $3,950,291. As a result of
the foregoing, Penn Octane no longer controls Rio Vista by virtue of its sale of
its ownership of the GP.
In connection with the Agreement,
Rio Vista agreed to pay Penn Octane $1.2 million of the closing proceeds from the transaction to settle
all amounts owing under
a $2.6 million promissory note made by Rio Vista in favor of Penn
Octane and all other
intercompany advances made between Penn Octane, on the one hand, and GP, Rio Vista and Rio Vista’s subsidiaries, on the other hand. Penn Octane used the $1.2 million of the
settlement proceeds to
settle and/or reduce
a significant portion of
Penn Octane’s outstanding
tax liabilities as of the date of the Closing. In addition, in
connection with the Closing, Penn Octane was released from a $400,000 guaranty
previously issued in favor of a third party creditor of Rio Vista as a result of
the settlement between the third party and Rio Vista which was satisfied by Rio
Vista at Closing.
The settlement of the tax liabilities
and elimination of the guaranty referred to above have has favorably improved
Penn Octane’s working capital deficit. Penn Octane still currently
has a working capital deficit. Penn Octane does not have any
operating assets and owns 197,628 common units of Rio Vista. The current value of the remaining
assets owned by Penn Octane are less than the additional amounts which may be
required to be paid to the taxing authorities to the extent that the payments
referred to above do not fully satisfy such obligations and other obligations
owed to unsecured creditors. Penn Octane intends to negotiate
settlements of all its outstanding obligations with its remaining creditors
based on those creditors accepting discounts of their current balances
owed. In the
opinion of management, if
Penn Octane is unable to settle all of its remaining obligations, Penn Octane would likely be required to seek protection
under the bankruptcy laws of the United States.
A copy of
the Agreement is included as an exhibit to this Form 8-K and is incorporated by
reference into this Item 2.01. The foregoing summary of certain provisions of
this document is qualified in its entirety by reference thereto.
Item 5.02.
Departure of Directors or Principal Officers; Election of Directors; Appointment
of Principal Officers; Compensatory Arrangements of Certain
Officers.
Resignation of
Director
On
December 2, 2010, Douglas Manner, a director of Penn Octane informed the Board
of Directors of his resignation effective December 2, 2010. The Board of
Directors accepted the resignation of Mr. Manner effective such date and thanked
him for his years of service to Penn Octane.
As a
result of Mr. Manner’s resignation, the Penn Octane Board of Directors is
comprised of three directors. The Board of Directors has no immediate
plans to replace Mr. Manner and/or add any additional members to the
Board.
Item 9.01
Financial Statements and Exhibits.
(d)
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Exhibits.
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The
following exhibits are filed with this report:
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10.1
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Fourth
Amendment to Securities Purchase and Sale Agreement between Central
Energy, LLC, Rio Vista Energy Partners, L.P. and Penn Octane Corporation,
dated November 17, 2010. All schedules described in this
exhibit have been omitted and will be furnished supplementally to the
Securities and Exchange Commission upon
request.
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10.2
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Mutual
Release dated as of November 17, 2010, by and among Penn Octane
Corporation, Rio Vista Energy Partners, L.P. and Rio Vista GP,
LLC.
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10.3
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Release
dated as of November 17, 2010 by Rio Vista Energy Partners, L.P., Rio
Vista GP, LLC and Central Energy, LP, and the persons identified on
Schedule I attached thereto
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10.4
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Termination
Agreement dated as of November 17, 2010 among Penn Octane Corporation,
Rio Vista GP, LLC, Rio Vista
Energy Partners, L.P. and Rio Vista Operating
Partnership.
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Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
PENN
OCTANE CORPORATION
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By:
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/s/
Ian T. Bothwell
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Name:
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Ian
T. Bothwell
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Title:
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Chief
Executive Officer, President, Vice President, Chief Financial Officer,
Treasurer and Assistant Secretary (Principal Executive, Financial and
Accounting Officer)
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Date:
December 7, 2010
EXHIBIT
INDEX
Exhibit No.
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Description
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10.1
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Fourth
Amendment to Securities Purchase and Sale Agreement between Central
Energy, LLC, Rio Vista Energy Partners, L.P. and Penn Octane Corporation,
dated November 17, 2010. All schedules described in this
exhibit have been omitted and will be furnished supplementally to the
Securities and Exchange Commission upon request.
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10.2 | Mutual Release dated as of November 17, 2010, by and among Penn Octane Corporation, Rio Vista Energy Partners, L.P. and Rio Vista GP, LLC. | |
10.3 | Release dated as of November 17, 2010 by Rio Vista Energy Partners, L.P., Rio Vista GP, LLC and Central Energy, LP, and the persons identified on Schedule I attached thereto. | |
10.4
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Termination Agreement dated as of November 17, 2010 among Penn Octane Corporation, Rio Vista GP, LLC, Rio Vista Energy Partners, L.P. and Rio Vista Operating Partnership. |