RIO VISTA GP LLC
VOTING AGREEMENT
______________, 2004
VOTING AGREEMENT
This Voting Agreement (this "AGREEMENT") is entered into as of
____________, 2004, by and among Rio Vista GP LLC, a Delaware limited liability
company (the "COMPANY"), Penn Octane Corporation, a Delaware corporation and
member of the Company ("PENN OCTANE"), and the members of the Company identified
on the signature page of this Agreement (collectively, the "MEMBERS" and,
individually, each a "MEMBER"). The Company, Penn Octane and the Members are
sometimes referred to herein, collectively, as the "parties" and, individually,
as a "party" to this Agreement. Unless otherwise provided, capitalized terms
used in this Agreement have the meanings ascribed to them in Section 5 hereof.
---------
RECITALS
--------
WHEREAS, immediately prior to the date hereof, Penn Octane was the owner of
on hundred percent (100%) of the limited liability company interests of the
Company (the "PENN OCTANE INTEREST").
WHEREAS, pursuant to option agreements dated July 10, 2003, Penn Octane
granted each Member the right (the "PURCHASE RIGHT") to purchase twenty-five
percent (25%) of the Penn Octane Interest at an exercise price equal to the pro
rata portion of the tax basis capital the Partnership (as defined in Section 1.4
of this Agreement) after the distribution of the common units of the Partnership
to the stockholders of Penn Octane.
WHEREAS, the exercise of the Purchase Right is conditioned upon the
execution and delivery of this Agreement by each Member.
AGREEMENT
---------
NOW, THEREFORE, in consideration of the mutual promises, representations,
warranties, covenants, and conditions set forth in this Agreement, the Purchase
Right and for other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the Parties hereby agree as follows:
1. VOTING AGREEMENT.
-----------------
1.1 Voting by Member for Managers. From and after the date hereof and
until the provisions of this Section 1 cease to be effective, at each meeting of
the members of the Company, or at any meeting of the members of the Company at
which members of the Board of Managers of the Company (the "BOARD") are to be
elected, or whenever members of the Board are to be elected by the members of
the Company by written consent, each Member agrees to vote or act with respect
to all of his, her or its limited liability company interests in the Company and
shall take all other necessary or desirable actions within such Member's control
whether in such capacity as a Member, manager of the Company, officer of the
Company, or otherwise (including, without limitation, attendance at meetings, in
person or by proxy, for purposes of
obtaining a quorum and execution of written consents), and the Company agrees to
take all necessary and desirable actions within its control, so as to:
1.1.1 fix the number of members of the Board (the "MANAGERS"
and each, individually, a "MANAGER") at such number
designated by Penn Octane; and
1.1.2 elect each and every Manager designated by Penn Octane.
1.2 Removal and Substitution of Members of the Board. Each Member agrees
to vote or act with respect to all of his, her or its limited liability company
interests in the Company for the removal of any member of the Board upon the
request of Penn Octane and for the election to the Board of a substitute
nominated by Penn Octane in accordance with the provisions of Section 1.1. Each
Member agrees that no Manager may be removed from office without the approval of
Penn Octane. Each Member further agrees to vote or act with respect to all of
his, her or its limited liability company interests in the Company in such
manner as shall be necessary or appropriate to ensure that any vacancy on the
Board occurring for any reason shall be filled only in accordance with the
provisions of Section 1.1.
1.3 Voting by Member on All Other Matters. From and after the date hereof
and until the provisions of this Section 1 cease to be effective, at each
meeting of the members of the Company, or whenever members of the Company are to
take action by written consent, each Member agrees to vote or act with respect
to all of his, her or its limited liability company interests in the Company as
directed by Penn Octane and shall take all other necessary or desirable actions
within such Member's control whether in such capacity as a Member, Manager,
officer of the Company, or otherwise (including, without limitation, attendance
at meetings, in person or by proxy, for purposes of obtaining a quorum and
execution of written consents), and the Company agrees to take all necessary and
desirable actions within its control, as directed by Penn Octane.
1.4 Exceptions. The provisions of Section 1.3 of this Agreement do not
apply with respect to any matter involving (a) the sale, transfer, assignment,
pledge, hypothecation or other disposal of all or any portion of (i) any
general partner interest (the "GENERAL PARTNER INTEREST") in Rio Vista Energy
Partners L.P., a Delaware limited partnership (the "PARTNERSHIP"), or (ii) any
Incentive Distribution Rights (as defined in the First Amended and Restated
Agreement of Limited Partnership of Rio Vista Energy Partners L.P. (the
"PARTNERSHIP AGREEMENT")) or (b) the merger, consolidation or sale of all or
substantially all of the assets of the Partnership, its subsidiaries or the
Company.
2. NO REVOCATION. The voting agreements contained herein are coupled with an
--------------
interest and may not be revoked during the term of this Agreement.
3. LEGEND. Each certificate evidencing limited liability company interests in
------
the Company and each certificate issued in exchange for or upon the Transfer, as
defined in Section 5 below, of any limited liability company interests of the
Company will be stamped or otherwise imprinted with a legend in substantially
the following form:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A
VOTING AGREEMENT DATED AS OF ______________, 2004, ENTERED INTO
BY AND AMONG THE COMPANY, PENN OCTANE AND CERTAIN OF THE
COMPANY'S MEMBERS, AND BY ACCEPTING THESE SECURITIES, THE PERSON
ACCEPTING SUCH INTEREST SHALL BE DEEMED TO AGREE TO AND SHALL
BECOME BOUND BY ALL THE PROVISIONS OF SAID VOTING AGREEMENT. A
COPY OF SUCH VOTING AGREEMENT WILL BE FURNISHED, WITHOUT CHARGE,
BY THE COMPANY TO THE HOLDER HEREOF UPON WRITTEN REQUEST."
The Company will imprint such legend on all certificates representing limited
liability company interests outstanding prior to the date hereof.
4. TRANSFER. Prior to any Transfer of any limited liability company interest
--------
in the Company or any interest therein to any Person, which Transfer is subject
to the restrictions set forth in the Agreements, the Member effecting such
Transfer will cause the prospective Transferee(s) to execute and deliver to each
Party a counterpart of this Agreement.
5. DEFINITIONS. As used in this Agreement, the following terms shall have the
-----------
meanings set forth below:
5.1 "PERSON" means an individual, a partnership, a corporation, a limited
liability company, an association, a joint stock company, a trust, a joint
venture, an unincorporated organization, and a governmental entity or any
department, agency, or political subdivision thereof.
5.2 "TRANSFER" means the sale, transfer, assignment, pledge, hypothecation
or other disposal.
5.3 "TRANSFEREE" shall mean the recipient of a transfer.
6. MISCELLANEOUS.
-------------
6.1 Notices. All notices and other communications required or permitted
hereunder shall be in writing and shall be mailed by registered or certified
mail, postage prepaid, sent by facsimile or electronic mail or otherwise
delivered by hand or by messenger addressed as follows:
(1) if to a Member or Penn Octane, at the Member's or Penn
Octane's, as applicable, address, facsimile number or electronic mail address as
shown in the Company's records, as may be updated in accordance with the
provisions hereof.
(2) if to the Company, one copy should be sent to its address or
facsimile number set forth on the signature page of this Agreement and addressed
to the attention of the President, or at such other address or facsimile number
as the Company shall have furnished to the Members.
Each such notice or other communication shall for all purposes of this Agreement
be treated as effective or having been given when delivered if delivered
personally, or, if sent by mail, at the earlier of its receipt or 72 hours after
the same has been deposited in a regularly maintained receptacle for the deposit
of the United States mail, addressed and mailed as aforesaid or, if sent by
facsimile, upon confirmation of facsimile transfer.
6.2 Successors and Assigns. Except as otherwise provided herein, the
terms and conditions of this Agreement shall inure to the benefit of and be
binding upon the respective successors and assigns of the parties. Nothing in
this Agreement, express or implied, is intended to confer upon any party other
than the parties hereto or their respective successors and assigns any rights,
remedies, obligations or liabilities under or by reason of this Agreement,
except as expressly provided in this Agreement.
6.3 Severability. In the event that any provision of this Agreement
becomes or is declared by a court of competent jurisdiction to be illegal,
unenforceable or void, this Agreement shall continue in full force and effect
without said provision, and the parties agree to negotiate, in good faith, a
legal and enforceable substitute provision which most nearly effects the
parties' intent in entering into this Agreement.
6.4 Amendments and Waivers. Any term of this Agreement may be amended and
the observance of any term of this Agreement may be waived (either generally or
in a particular instance and either retroactively or prospectively), only with
the written consent of (i) the Company, (ii) each Member and (iii) Penn Octane.
Any such amendment, waiver, discharge or termination effected in accordance with
this paragraph shall be binding upon each holder of any securities purchased
under this Agreement at the time outstanding (including securities into which
such securities have been converted or exchanged or for which such securities
have been exercised) and each future holder of all such securities.
6.5 Governing Law. This Agreement shall be governed by and construed
under the laws of the State of Delaware as applied to agreements among Delaware
residents entered into and to be performed entirely within Delaware.
6.6 Specific Performance. The rights of the parties under this Agreement
are unique and, accordingly, the parties shall, in addition to such other
remedies as may be available to any of them at law or in equity, have the right
to enforce their rights hereunder by actions for specific performance to the
extent permitted by law.
6.7 Counterparts. This Agreement may be executed in any number of
counterparts, each of which, when so executed and delivered, will be deemed an
original, and all such counterparts together will constitute one and the same
instrument.
6.8 Conflict. In the event of any conflict between the terms of this
Agreement and the Company's Limited Liability Company Agreement, the Partnership
Agreement or any other agreement to which the Company, Penn Octane or a Member
is bound, the terms of this Agreement will control.
6.9 Attorney's Fees. In the event that any suit or action is instituted to
enforce any provision in this Agreement, the prevailing party in such dispute
shall be entitled to recover from
the losing party all fees, costs and expenses of enforcing any right of such
prevailing party under or with respect to this Agreement, including without
limitation, such reasonable fees and expenses of attorneys and accountants,
which shall include, without limitation, all fees, costs and expenses of
appeals.
6.10 Titles and Subtitles. The titles and subtitles used in this Agreement
are used for convenience only and are not to be considered in construing or
interpreting this Agreement. All references in this Agreement to sections,
paragraphs, exhibits and schedules shall, unless otherwise provided, refer to
sections and paragraphs hereof and exhibits and schedules attached hereto.
6.11 Entire Agreement. This Agreement constitutes the full and entire
understanding and agreement among the parties with regard to the subject matter
hereof and supercedes and replaces any prior verbal or written understandings,
communications, or representations between the Parties in relation to the
subject matter of this Agreement.
6.12 Construction. The parties hereto have participated jointly in the
negotiation and drafting of this Agreement. In the event an ambiguity or
question of intent or interpretation arises, this Agreement shall be construed
as if drafted jointly by the parties hereto and no presumption or burden of
proof shall arise favoring or disfavoring any party hereto by virtue of the
authorship of any of the provisions of this Agreement. Any reference to any
federal, state, local, or foreign statute or law shall be deemed also to refer
to all rules and regulations promulgated thereunder, unless the context requires
otherwise.
6.13 Delays or Omissions. Except as expressly provided herein, no delay or
omission to exercise any right, power or remedy accruing to any party to this
Agreement upon any breach or default of any other party under this Agreement
shall impair any such right, power or remedy of such non-defaulting party, nor
shall it be construed to be a waiver of any such breach or default, or an
acquiescence therein, or of or in any similar breach or default thereafter
occurring, nor shall any waiver of any single breach or default be deemed a
waiver of any other breach or default theretofore or thereafter occurring. Any
waiver, permit, consent or approval of any kind or character on the part of any
party of any breach or default under this Agreement, or any waiver on the part
of any party of any provisions or conditions of this Agreement, must be in
writing and shall be effective only to the extent specifically set forth in such
writing. All remedies, either under this Agreement or by law or otherwise
afforded to any party to this Agreement, shall be cumulative and not
alternative.
6.14 Telecopy Execution and Delivery. A facsimile, telecopy or other
reproduction of this Agreement may be executed by one or more parties hereto,
and an executed copy of this Agreement may be delivered by one or more parties
hereto by facsimile or similar electronic transmission device pursuant to which
the signature of or on behalf of such party can be seen, and such execution and
delivery shall be considered valid, binding and effective for all purposes. At
the request of any party hereto, all parties hereto agree to execute an original
of this Agreement as well as any facsimile, telecopy or other reproduction
hereof.
6.15 Jurisdiction; Venue. With respect to any disputes arising out of or
related to this Agreement, the parties consent to the exclusive jurisdiction of,
and venue in, the state or federal courts in Harris County in the State of
Texas.
6.16 Jury Trial. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO
THE FULLEST EXTENT PERMITTED BY LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY
LEGAL PROCEEDING (WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE) ARISING OUT
OF OR RELATED TO THIS AGREEMENT.
6.17 Further Assurances; Instruments. Each of the Members, Penn Octane and
the Company agree not to vote any of their respective limited liability
interests in the Company, or to take any other actions, that would in any manner
defeat, impair, be inconsistent with or adversely affect the rights of the
parties under Section 1 of this Agreement. From time to time, each party hereto
shall execute and deliver such instruments and documents as may be reasonably
necessary to carry out the purposes and intent of this Agreement.
(Signatures on following page.)
IN WITNESS WHEREOF, the undersigned or each of their respective duly
authorized officers or representatives have set their hands hereunto effective
upon the date first above written.
COMPANY: PENN OCTANE:
RIO VISTA GP LLC PENN OCTANE CORPORATION
a Delaware limited liability company a Delaware corporation
By: By:
--------------------------------- --------------------------------
Richard Shore, Jr. Jerome B. Richter
President Chief Executive Officer
820 Gessner Road
Suite 1250
Houston, Texas 77024 THE MEMBERS:
SHORE CAPITAL LLC
By:
--------------------------------
Richard Shore, Jr., President
-----------------------------------
Jerome B. Richter
[Signature Page to Voting Agreement]