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EXHIBIT 10.3
GENERAL RELEASE
This
GENERAL RELEASE (the “ Release
”) is made as of March 25, 2008, by and among Impact
International, L.L.C., an Oklahoma limited liability company
(“ Impact
”), Ramiiilaj, a Limited Partnership, a Texas limited
partnership (“ Ramiiilaj
”), Reef Ventures, L.P., a Texas limited partnership
(“ Reef
Ventures ”), Arrecefe Management, LLC, a Texas
limited liability company (“ Arrecefe
”), and Tidelands Oil & Gas Corporation, a Nevada
corporation (“ Tidelands
”). Each of Impact, Ramiiilaj, Reef Ventures,
Arrecefe and Tidelands are sometimes referred to in this
Release as a “ Party
” and collectively as the “ Parties
”. Tidelands, Reef Ventures, and Arrecefe are
collectively referred to in this Release as the “
Tidelands
Parties ”. Impact and Ramiiilaj are
collectively referred to in this Release as the “
Impact
Parties ”.
WHEREAS, Tidelands made a
Promissory Note in the original principal amount of Six
Million Five Hundred Twenty-Three Thousand Seven Hundred
Seventy-Three and 30/100 Dollars ($6,523,773.30), dated May
25, 2004 (the “ Closing
Date ”), payable to the order of Impact (the
“ Note
”) in connection with the purchase by Tidelands of all
of the right, title, and interest of Impact in Reef Ventures
and the purchase by Arrecefe, a subsidiary of Tidelands, of
all of the right, title, and interest of Coahuila Pipeline,
LLC, a Texas limited liability company and affiliate of
Impact (“ Coahuila
”), in Reef Ventures, pursuant to a Purchase and Sale
Agreement dated the Closing Date by and among Impact,
Tidelands, Arrecefe, and Coahuila (the “ Purchase
Agreement ”);
WHEREAS, as security for
Tidelands’ obligations under the Note, Tidelands caused
Arrecefe, as general partner of Reef Ventures, (a) to cause
Reef Ventures to issue a Guaranty to Impact dated the Closing
Date in which Reef Ventures guaranteed Tidelands’
payment and performance under the Note (the “
Guaranty
”), and (b) to enter into a Deed of Trust, Mortgage,
Security Agreement, Financing Statement and Assignment with
Impact dated the Closing Date in which Reef Ventures granted
a lien on certain of its properties to Impact (the “
Deed of
Trust ”);
WHEREAS, as security for
Reef Ventures’ obligations under the Guaranty,
Tidelands caused Arrecefe, as general partner of Reef
Ventures, (a) to cause Reef Ventures to enter into a Pledge
Agreement with Impact dated the Closing Date in which Reef
Ventures pledged 100% of the membership interests of Reef
International, LLC, a Texas limited liability company
(“ Reef
International ”), to Impact (the “
Pledge
Agreement ”), and (b) to issue a Membership
Interest Power to Impact dated the Closing Date in which Reef
Ventures granted Impact the right to appoint a person as
attorney to transfer such membership interests to Impact (the
“ Power
”);
WHEREAS, in connection with
the Purchase Agreement, Tidelands and Impact entered into a
First Amendment to Stock Purchase Warrant dated the Closing
Date (the “ First Amendment
to Warrant ”) in which Tidelands and Impact
amended certain terms of the Stock Purchase Warrant between
Tidelands and Impact dated April 16, 2003 (the “
Original
Warrant ”), and a First Amendment to
Registration Rights Agreement dated the Closing Date (the
“ First Amendment
to Registration Rights Agreement ”) in which
Tidelands and Impact amended certain terms of the
Registration Rights Agreement between Tidelands and Impact
dated April 16, 2003 (the “ Original
Agreement ”);
WHEREAS, as provided
herein, the Impact Parties desire to terminate the
obligations and liabilities of the Tidelands Released Persons
(as defined below), if any such obligations or liabilities
exist, under the Purchase Agreement, the Guaranty, the Deed
of Trust, the Pledge Agreement, the Power, the First
Amendment to Warrant, the Original Warrant, the First
Amendment to Registration Rights Agreement, the Original
Agreement, and all other agreements, documents and
instruments executed or delivered by any of the Impact
Released Persons (as defined below) or the Tidelands Released
Persons in connection therewith (collectively, the “
Transaction
Documents ”) and each Party desires to release
each of the other Parties and their Affiliates (as defined
below) and Representatives (as defined below) from all
obligations and liability whatsoever related to the
Transaction Documents.
NOW,
THEREFORE, in consideration of the mutual agreements,
covenants, representations and warranties contained herein and
for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Parties
hereby agree as follows:
1.
Termination . The Impact Parties agree that all
of the obligations and liabilities of any and all of the Tidelands
Parties and each of their Affiliates and Representatives
(collectively, the “ Tidelands Released
Persons ”) under the Transaction Documents, if any
such obligations or liabilities exist, are hereby terminated for
all purposes, and that all duties and obligations of the Tidelands
Released Persons set forth in the Transaction Documents, if any
such duties or obligations exist, are of no further force or
effect.
2.
Release and Covenant Not to Sue . Each Party
releases and forever discharges, for itself and for each of its
past, present and future parents, subsidiaries and affiliates
(collectively, “ Affiliates
”) and each of its and its Affiliates’ past, present,
and future officers, directors, shareholders, limited liability
company membership interest holders, limited partners, general
partners, members, managers, employees, agents, representatives,
successors, and assigns and all other persons acting on behalf of
such Party or its Affiliates (collectively, “ Representatives
”), each of the other Parties, and each of the other
Parties’ Affiliates and Representatives from any and all
actions, causes of action, obligations, costs, expenses (including
costs of investigation and attorneys fees), controversies, damages
(including incidental and consequential damages), losses, claims,
liabilities, suits, and demands, of whatever character, in law or
in equity, known or unknown (including acts of God), statutory or
at common law, federal or state, suspected or unsuspected,
contingent or realized, from the beginning of time (collectively,
“ Obligations and
Claims ”, or individually, an “ Obligation
” or “ Claim
”), specifically including, but not limited to, all
Obligations and Claims arising out of or related in any manner to
the Transaction Documents or the performance, non-performance, acts
or omissions of any of the Parties and their Affiliates and
Representatives thereunder. The foregoing notwithstanding, the
Parties acknowledge and agree that this Release in no way waives
any rights any of the Parties might possess in connection with the
enforcement of this Release. Each of the Parties hereby
covenants not to, and to cause all of its Affiliates and
Representatives not to, bring any action, cause of action, suit or
other proceeding of any kind, which has accrued or which may ever
accrue, whether based in the United States Constitution, any state
constitution, common law or statute, contract, tort, or in equity,
for actual or punitive damages or other relief, against any of the
other Parties or their Affiliates or Representatives arising out
of, resulting from, or in any manner related to the matters
released in this Section 2
.
3.
Specific Matters . Without limiting the
provisions of Sections 1 and
2
of this Release, this Release shall effectively terminate and
release, but is not limited to, all Obligations and Claims arising
out of, resulting from, or in
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