AMENDMENT TO ASSET PURCHASE AGREEMENT

Exhibit 2.8

 

AMENDMENT TO ASSET PURCHASE AGREEMENT

This Amendment to Asset Purchase Agreement (the “Amendment”) is made and entered into this 25th day of October, 2007, by and among Penny Petroleum Corporation, an Oklahoma corporation, located at 111 South Main Street, Eufaula, Oklahoma (the “Seller”), Gary Moores, (“Moores” or the “Shareholder”), and Rio Vista Penny, LLC, an Oklahoma limited liability company, located at 2121 Rosecrans Ave, Suite 3355, El Segundo, CA 90245 (the “Buyer”) and Rio Vista Energy Partners L.P., a Delaware limited partnership, located at 2121 Rosecrans Ave, Suite 3355, El Segundo, CA 90245 (“Rio Vista”).

RECITALS

A. Buyer, Rio Vista, Seller, and Shareholder have executed that certain Stock Purchase Agreement (the “Agreement”) dated effective October 1, 2007, by and among Buyer, Rio Vista, Seller, and Shareholder, which provides for the sale of certain assets of Seller to Buyer.

B. The Recitals of the Agreement provide as follows:

WHEREAS, Seller owns and desires to sell certain of its real and personal property interests in certain oil and gas properties located in McIntosh, Pittsburg and Haskell counties, as described in Section 1.2 below (collectively, the “Assets”);

WHEREAS, Seller owns and desires to sell approximately ten percent (10%) of the issued and outstanding shares of capital stock of G M Oil Properties, Inc., an Oklahoma corporation, which stock is included among the Assets;

WHEREAS, Seller owns and desires to sell approximately sixty six and two thirds percent (66.66%) of the issued and outstanding shares of capital stock of MV Pipeline Company, an Oklahoma corporation, which stock is included among the Assets; and

WHEREAS, Buyer desires to purchase the Assets pursuant to the terms of this Agreement.

C. Paragraph 1.2 of the Agreement provides as follows:

1.2 Assets. The interest in and to the real property and the other types of property associated therewith as described in this Section 1.2 will be referred to collectively as the “Assets.” The Assets are comprised of the following:

(a) All of Seller’s right, title and interest in and to the oil and gas properties specifically described in Exhibit B (collectively, the “Properties”), the working interests owned by Seller in the Properties, and any and all right, title and interest of Seller in and to the oil, gas and all other hydrocarbons in, on or under the lands described on Exhibit B (the “Lands”) and other hydrocarbons and products, whether liquid or gaseous, produced in association therewith (“Hydrocarbons”) after the Effective Time and all other minerals of whatever nature in, on or under the Lands and lands pooled or unitized therewith.

(b) The oil and gas wells located on the Lands, or lands pooled or unitized therewith, including without limitation, the oil and gas wells specifically described in Exhibit B, whether producing or non-producing and whether fully or properly described or not, (the “Wells”), all injection and disposal wells on the Lands, and all personal property and equipment associated with the Wells as of the Effective Time.

(c) The rights, to the extent transferable, in and to all existing and effective unitization, pooling and communitization agreements, declarations and orders, and the properties covered and the units created thereby to the extent that they relate to or affect any of either Seller’s properties and interests described in Sections 1.2(a) and (b) or the production of Hydrocarbons, if any, attributable to said properties and interests after the Effective Time.

(d) The rights, to the extent transferable without material restriction under applicable law or third-party agreements (without the payment of any funds or consideration), in and to existing and effective oil, gas, liquids, condensate, casinghead gas and natural gas sales, purchase, exchange, gathering, transportation and processing contracts, operating agreements, balancing agreements, joint venture agreements, partnership agreements, farmout agreements and other contracts, agreements and instruments (the “Material Agreements”), insofar only as they relate to any of Seller’s properties and interests described in Sections 1.2(a), (b) and (c), excluding, however, any insurance contracts.

(e) All of the personal property, fixtures, improvements, permits, licenses, approvals, servitudes, rights-of-way and easements, including, without limitation the rights of way and easements set forth on Exhibit B, surface leases and other surface rights (including, but not limited to, any wells, tanks, boilers, buildings, injection facilities, saltwater disposal facilities, compression facilities, gathering systems, other appurtenances and facilities) located on or used in connection with or otherwise related to the exploration for or production, gathering, treatment, processing, storing, sale or disposal of Hydrocarbons or water produced from the properties and interests described in Sections 1.2(a) through (d) to the extent that they are located on or used in the operation of the Assets as of the Effective Time, and all contract rights (including rights under leases to third parties) related thereto.

(f) The files, records, data and information relating to the items described in Sections 1.2(a) through (e) maintained by Seller (the “Records”), including without limitation, accounting files relating to the Assets, lease files, land files, well files, gas, oil and other hydrocarbon sales contract files, gas processing files, division order files, abstracts, title opinions, all electronic files directly related to the Assets, AFEs, geological and seismic data to the extent such seismic data can be transferred at no cost to Seller, and all other information of every type related exclusively or primarily to any of the Assets, but excluding the following:

(i) all of Seller’s internal appraisals and interpretive data related to the Assets,

(ii) all information and data under contractual restrictions on assignment,

(iii) all privileged information,

(iv) Seller’s corporate, financial, employee and general tax records that do not relate exclusively to the Assets and

(v) all accounting files that do not relate to the Assets.

(g) All of Seller’s right, title and interest in and to any and all shares of the capital stock (the “GMO Stock”) of G M Oil Properties, Inc., an Oklahoma corporation (“GMO”).

(h) All of Seller’s right, title and interest in and to any and all shares of the capital stock (the “MV Stock”) of MV Pipeline Company, an Oklahoma corporation (“MV”).

D. Paragraph 2.1 of the Agreement provides as follows:

2.1 Purchase Price. The purchase price (the “Purchase Price”) payable by Buyer for the Assets shall be $7,400,000, payable by Buyer at Closing as follows:

(a) Buyer will pay Seller $6,900,000 in cash or other immediately available funds; and

(b) Buyer will deliver to the Seller forty-five thousand nine hundred nine-eighty (45,998) common units of Rio Vista (the “Purchase Price Units”). Rio Vista will utilize its best efforts to register said units through an S-3 filing or, if Form S-3 is unavailable on any other appropriate form within ninety (90) days of the Effective Time. Part or all of the Purchase Price Units shall be used by Seller to pay in full that certain promissory note payable by Seller to Moores which is the MV Pipeline Company debt owed to Moores.

E. Paragraph 4.22 of the Agreement provides as follows:

(a) The authorized capital stock of GMO consists of two million (2,000,000) shares of GMO Stock, par value $.001 per share.

(b) The authorized capital stock of Company consists of two million (2,000,000) shares of Preferred Stock, $0.001 par value per share, of which no shares are outstanding and three million (3,000,000) shares of Common Stock, $0.001 par value per share, of which one million (1,000,000) shares are outstanding and of which 10% are owned by the Seller, free and clear of all liens, encumbrances, security agreements, options, claims, charges and restrictions, all of which outstanding shares are validly issued, fully paid and non-assessable. There are no shares of Company’s capital stock held in its treasury. There are no options, warrants, rights, shareholder agreements or other instruments or agreements outstanding giving any person the right to acquire any shares of capital stock of Company or any subsidiary of Company, nor are there any commitments to issue or execute any such options, warrants, rights, shareholder agreements or other instruments or agreements. There are no outstanding stock appreciation rights or similar rights measured with respect to any of Company’s or any Company subsidiary’s capital stock, nor are there any instruments, or agreements giving anyone the right to acquire any such rights. Seller has delivered or prior to Closing shall deliver to the Buyer accurate and complete copies of its stock certificates evidencing the Shares.

F. Paragraph 10.3 of the Agreement provides as follows:

10.3 Closing Obligations . At Closing, the following events shall occur, each being a condition precedent to the others and each being deemed to have occurred simultaneously with the others:

(a) Seller shall execute, acknowledge and deliver to Buyer

(i) an Assignment, Bill of Sale and Conveyance of the Assets, effective as of the Effective Time to Buyer (in sufficient counterparts to facilitate filing and recording) substantially in the form of Exhibit C conveying the Assets; and

(ii) such other assignments, bills of sale, or deeds necessary to transfer the Assets to Buyer, including without limitation any conveyances on official forms and related documentation necessary to transfer the Assets to Buyer in accordance with requirements of governmental regulations (collectively, the “Conveyances”);

(b) Buyer shall deliver to Seller the cash portion of the Purchase Price in immediately available funds, less the amount of the Deposit and any additional deposit paid to Seller pursuant to Section 10.1, and the Purchase Price Units;

(c) Seller shall deliver to Buyer possession of the Assets;

(d) Seller and Buyer shall execute and deliver letters in lieu directing all purchasers of production to pay Buyer the proceeds attributable to production from the Assets from and after the Effective Time;

(e) Buyer shall deliver to Seller evidence of appropriate federal, state and local bonds relating to ownership of the Assets after the Closing and certificates of insurance evidencing that Buyer has obtained appropriate insurance covering the Assets;

(f) Seller shall deliver to Buyer certificates substantiating non-foreign status in accordance with Treasury Regulations under Section 1445 of the Code, in the form of Exhibit D (“FIRPTA Certificate”);

(g) Buyer shall prepare and Seller shall execute and deliver to Buyer all forms necessary for Buyer to assume operations on the Assets as agreed to by the Parties; and

(h) Seller shall deliver to Buyer the certificates for all of the GMO Stock and all of the MV Stock properly executed for assignment to Buyer.

G. The parties desire to amend the Agreement, subject, however, to Paragraph 2 of this Amendment.

AGREEMENT

For good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows:

1. The Agreement is amended as follows:

(a) The Recitals of the Agreement are deleted in their entirety and the following is substituted therefor:

WHEREAS, Seller owns and desires to sell certain of its real and personal property interests in certain oil and gas properties located in McIntosh, Pittsburg and Haskell counties, as described in Section 1.2 below (collectively, the “Assets”);

WHEREAS, Seller owns and desires to sell approximately sixty six and two thirds percent (66.66%) of the issued and outstanding shares of capital stock of MV Pipeline Company, an Oklahoma corporation, which stock is included among the Assets; and

WHEREAS, Buyer desires to purchase the Assets pursuant to the terms of this Agreement.

(b) Paragraph 1.2 of the Agreement is deleted in its entirety and the following is substituted therefor:

1.2 Assets. The interest in and to the real property and the other types of property associated therewith as described in this Section 1.2 will be referred to collectively as the “Assets.” The Assets are comprised of the following:

(a) All of Seller’s right, title and interest in and to the oil and gas