GENERAL RELEASE
EXHIBIT
10.3
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
Xxx. 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.
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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 any manner related
to, any of the following:
(a) All
rights of any of the Impact Parties and each of their Affiliates and
Representatives (collectively, the “Impact Released
Persons”) to receive, and any obligations of any of the Tidelands
Released Persons to deliver, any amount of money set forth in the Note, the Deed
of Trust, or the Guaranty;
(b) All
rights of any of the Impact Released Persons related to Tidelands’ stock set
forth in the Original Warrant, the First Amendment to Warrant, the Original
Agreement, or the First Amendment to Registration Rights Agreement, and all
rights of any of the Impact Released Persons related to the membership interests
of Reef International set forth in the Pledge or the Power;
(c) All
rights of any of the Impact Released Persons to require the performance of any
actions of any kind by any of the Tidelands Released Persons contemplated in any
of the Transaction Documents;
(d) Any
and all representations or warranties given by any of the Tidelands Released
Persons in any of the Transaction Documents; and
(e) Any
and all obligations of any of the Tidelands Released Persons to indemnify any of
the Impact Released Persons or any other person for any losses, claims, damages,
liabilities or expenses or any other matter arising under or in connection with
any of the Transaction Documents.
4. Consideration. As
a portion of the consideration for this Release and for the Impact Parties’
agreement to cancel the Note, terminate the Pledge Agreement, release and
terminate the Deed of Trust, and perform each and all of the other covenants set
forth in this Release, Tidelands will cause Reef Ventures to direct West Texas
Gas, Inc., acting on behalf of Tidelands and Reef Ventures, to (a) pay Impact
the amount of $2,436,825 (the “Release
Consideration”) by wire transfer to the following bank account of
Impact:
Stillwater National Bank
ABA # 000000000
For Further credit to Impact
International, LLC
Account No: 0000000;
and (b)
Tidelands will issue 39,890,180 shares of Tidelands restricted common stock (the
“Restricted
Stock”) to Impact. The Impact Parties agree that the payment
of the Release Consideration to the foregoing bank account of Impact and the
issuance of the Restricted Stock to Impact, in addition the mutual promises set
forth in this Release, constitute full and adequate consideration for this
Release, the receipt of which is hereby acknowledged by each of the Impact
Parties. The Impact Parties agree to indemnify and hold the Tidelands
Released Persons harmless from any Obligations and Claims which might arise as a
result of (i) West Texas Gas, Inc., acting on behalf of Tidelands and Reef
Ventures, sending the Release Consideration to be received by any of the Impact
Parties to the above-referenced bank account or (ii) Tidelands issuing the
Restricted Stock to be received by any of the Impact Parties to
Impact.
5. No Previous Assignment of
Rights. The Impact Parties represent and warrant that they
have not assigned or transferred, or purported to assign or transfer, to any
person or entity, all or any portion of any Obligation or Claim released under
Section 2 of
this Release.
6. Voluntary
Release. Each of the Impact Parties acknowledges that it has
carefully read and fully understands the provisions of this Release, including,
specifically, the release of Obligations and Claims set forth in Section 2 of this
Release, and that each of the Impact Parties is knowingly and voluntarily
entering into this Release. Each of the Impact Parties acknowledges
that it has had a reasonable opportunity to consult with its legal counsel prior
to executing this Release.
7. Complete
Defense. The Impact Parties acknowledge and agree that this
Release shall be a complete defense to any Obligation or Claim released under
the terms of Section
2 of this Release, and each of the Impact Parties hereby consents to the
entry of a temporary or permanent injunction to end the assertion of any such
Obligation or Claim.
8. Indemnification. The
Impact Parties shall, jointly and severally, and shall cause the other Impact
Released Persons to, indemnify the Tidelands Released Persons, and hold the
Tidelands Released Persons harmless against any and all damages (including
incidental and consequential damages), liabilities, losses, costs, and expenses
(including costs of investigation and attorneys’ fees) of every kind and
description, whether or not involving third party claims, arising directly or
indirectly from or in connection with (i) the assertion by or on behalf of any
Impact Released Person of any Obligation, Claim, or other matter purported to be
released pursuant to this Release; (ii) the assertion by any third party of any
claim or demand against any Tidelands Released Person, which claim or demand
arises directly or indirectly from, or in connection with, any assertion by or
on behalf of any Impact Released Person against such third party of any Claims,
Obligations, or other matters purported to be released pursuant to this Release;
(iii) the breach by any Impact Party of any representation, warranty, or
covenant contained in this Release; and (iv) the defense by any Tidelands
Released Person of, or the pursuit or obtainment by any Tidelands Released
Person of, any injunction to terminate the assertion of any Obligation or Claim
released under this Release.
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9. Survival. All
covenants, representations, warranties, and agreements of the Impact Parties
shall survive execution and delivery of this Release and shall continue until
such time as all the obligations of the Impact Parties in this Release shall
have lapsed in accordance with their respective terms or shall have been
discharged in full.
10. Further Assurances.
The Impact Parties agree (a) to furnish upon request to the Tidelands Parties
such further information, (b) to execute and deliver to the Tidelands Parties
such other documents, and (c) to do such other acts and things, all as any of
the Tidelands Parties may request, for the purpose of carrying out the intent of
this Release.
11. Authority. By
their signatures below, each of the Impact Parties represents and warrants to
each of the Tidelands Parties that it has all necessary authority to enter into
this Release. Each of the Impact Parties represents and warrants that
it is entering into this Release solely for the purposes and consideration set
forth herein, and further warrants that this Release is being executed without
reliance on any representation of any kind or character not expressly set forth
herein. Each of the Impact Parties warrants that it has read this
Release and that it has had the opportunity to consult with its legal counsel as
to its effect.
12. Separability. If
any provision of this Release is held invalid or unenforceable by any court of
competent jurisdiction, the other provisions of this Release will remain in full
force and effect. Any provision of this Release held invalid or
unenforceable only in part or degree will remain in full force and effect to the
extent not held invalid or unenforceable.
13. Amendments,
Waiver. No amendment, modification, termination or waiver of
any provision of this Release shall be effective unless the same shall be in
writing and signed by the Parties, and then such waiver or consent shall be
effective only in the specific instance and the specific purpose for which
given.
14. Governing Law. This
Release shall be governed and construed in accordance with the applicable laws
of the State of Texas, without regard to its conflicts of law
principles.
15. Venue. Any
Party bringing a legal action or proceeding against another Party for the
resolution of any dispute arising in connection with the interpretation,
construction, or enforcement of this Release shall bring such legal action or
proceeding in any court of the State of Texas sitting in Bexar County, Texas or
any federal court having jurisdiction over Bexar County, Texas. Each Party
hereto agrees to submit to the exclusive personal jurisdiction and venue of the
state and federal courts having jurisdiction over Bexar County, Texas, for the
resolution of all disputes arising in connection with the interpretation,
construction, and enforcement of this Release, and hereby waives the claim or
defense therein that such courts constitute an inconvenient forum. Each Party
waives, to the fullest extent permitted by law, any objection that it may now or
later have to the laying of venue of any legal action or proceeding arising out
of or relating to this Release brought in any such courts.
16. Expenses. Each Party
shall be responsible for its own expenses and costs, including but not limited
to reasonable attorney’s fees and costs, incurred, or that may in the future be
incurred, in connection with the preparation, execution, delivery and
performance of this Release.
17. Notices. Any
notice or other communication required or permitted hereunder shall be in
writing and shall be delivered personally, sent by facsimile transmission or
sent by certified, registered or express mail, postage prepaid to the Parties at
their respective addresses set forth below or to such other address as a Party
may hereafter specify in writing and deliver in accordance with this Section
17. Any such notice shall be deemed given when so delivered
personally or sent (with confirmation of transmission) by facsimile or, if
mailed, three (3) days after the date of deposit in the United States mail,
to:
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| If to any of the Tidelands Parties: |
Tidelands
Oil & Gas Corporation
|
|
|
0000
X. Xxxxxxx, Xxxx. 0
|
|
Xxx
Xxxxxxx, Xxxxx 00000
|
|
|
|
Attention:
Xxxxx X. Xxxxx
|
|
Fax:
(000) 000-0000
|
|
|
|
|
|
|
|
|
with
a copy (which shall not constitute notice) to:
|
Xxxxxxxxxxx
& Price, LLP
|
|
000
Xxxxxxx Xxxxxx, Xxxxx 000
|
|
|
Xxx
Xxxxxxx, Xxxxx 00000
|
|
| Attn: Xxxxx X. Xxxxxxx | |
|
|
Fax:
(000) 000-0000
|
|
If
to any of the Impact Parties:
|
Impact
International, L.L.C.
|
|
0000
Xxxxxxxxx Xxxx.
|
|
|
Xxxxx
000
|
|
|
Xxxx.: Xxx
Xxxxxx
|
18. Entire
Agreement. This Release, when fully executed, supersedes all
previous negotiations, representations, and discussions by the Parties hereto
concerning the subject matter hereof and integrates the whole of all of their
agreements and understandings concerning the subject matter hereof. No oral
representations or undertakings concerning the subject matter hereof shall
operate to amend, supersede, or replace any of the terms or conditions set forth
herein.
19. Counterparts. This
Release may be executed in one or more counterparts, each of which will be
deemed to be an original copy of this Release and all of which, when taken
together, will be deemed to constitute one and the same
agreement. The exchange of copies of this Release and of signature
pages by facsimile transmission or by email with attachment in portable document
format (.pdf) or other comparable format shall constitute effective execution
and delivery of this Release as to the Parties and may be used in lieu of the
original Release for all purposes. Signatures of the parties
transmitted by facsimile shall be deemed to be their original signatures for any
purposes whatsoever.
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This
Release has been executed as of the date first written above.
REEF
VENTURES, L.P.
By: Arrecefe Management, LLC, its
general partner
By: /s/
Xxxxx. X.
Xxxxx
Name: Xxxxx
X.
Xxxxx
Title: Manager
ARRECEFE MANAGEMENT,
LLC
By: /s/ Xxxxx. X.
Xxxxx
Name: Xxxxx X.
Xxxxx
Title: Manager
TIDELANDS
OIL & GAS CORPORATION
By: /s/ Xxxxx. X.
Xxxxx
Name: Xxxxx X.
Xxxxx
Title: President
& Chief Executive Officer
IMPACT
INTERNATIONAL, L.L.C.
By: /s/ Xxxxx X. Xxxxxx
III
Name: Xxxxx X. Xxxxxx
III
Title: Manager
RAMIIILAJ,
a Limited Partnership
By: Xxxxxx
Investment Company, its general partner
By: /s/ Xxxxx X. Xxxxxx
III
Name: Xxxxx X. Xxxxxx
III
Title: Vice
President
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