Rio Vista Energy Partners L.P. Enters into Letter of Intent to Sell Regional
11 Agosto 2009 - 2:01AM
Business Wire
Rio Vista Energy Partners L.P. (NASDAQ: RVEP), an energy
services master limited partnership, announced today that it had
entered into a non-binding letter of intent (LOI) on July 29, 2009
to sell its wholly-owned subsidiary, Regional Enterprises Inc.
(Regional) to an undisclosed buyer (Buyer). Under the terms of the
LOI, the purchase price to Buyer to acquire 100% of the outstanding
stock of Regional held by Rio Vista will be $5,000,000, less
certain adjustments as described in the LOI and less deposits of
$250,000 received from Buyer in connection with the LOI. Buyer will
assume all the obligations of Regional, except for obligations of
Regional to Rio Vista and/or any of its affiliates, totaling
approximately $2,500,000 at June 30, 2009 (Affiliate Obligations)
for which a portion of the purchase price will be applied for
payment of the Affiliate Obligations by Regional at closing. The
closing is to occur no later than September 28, 2009, unless
extended as a result of permitted delays as prescribed in the LOI
(Permitted Delays). The Permitted Delays generally consist of Rio
Vista’s requirement to deliver financial statements of Regional to
Buyer by August 21, 2009, Rio Vista’s decision to seek a
satisfactory fairness opinion for the transaction, Rio Vista’s
decision to seek the necessary unitholder approval for the
transaction, delays associated with Regional’s collateralized
lender to approve and finalize the required consent for Buyer to
assume such obligation, and/or any other condition which Rio Vista
believes is required to consummate the transaction.
The LOI is non-binding and an actual closing as prescribed in
the LOI is subject to many conditions and uncertainties related to
both Buyer and/or Rio Vista. In the event that the sale of Regional
takes place as prescribed in the LOI, Rio Vista believes that the
amount of cash received from Buyer will be sufficient for Rio Vista
to satisfy all of its obligations to its creditors. Upon the sale
of Regional to Buyer, Rio Vista would no longer have any operating
assets and Rio Vista estimates that there will be minimal remaining
cash. Rio Vista would not have any other current sources of
additional cash flow.
If the sale of Regional to Buyer is not consummated as
prescribed herein, Rio Vista may seek to sell Regional to other
parties or may elect to continue to operate Regional. Rio Vista
currently has a deficit in working capital and a loss from
continuing operations. If the amount of proceeds raised from the
sale of Regional or the existing cash flow generated from
continuing to operate Regional are not sufficient to satisfy Rio
Vista’s obligations, Rio Vista would likely be required to seek
other alternatives which could include protection under the U.S.
bankruptcy laws.
About Rio Vista Energy Partners L.P.
Rio Vista is a master limited partnership engaged in liquid bulk
storage, transloading and transportation of chemicals and petroleum
products through its assets and operations in Hopewell, Virginia.
Penn Octane Corporation (OTCBB: POCC) owns 75% of Rio Vista GP LLC,
the general partner of Rio Vista.
Forward-Looking Statements
Certain of the statements in this news release are
forward-looking statements, including statements regarding the sale
of Regional and the ability to satisfy obligations to creditors
from proceeds received from the sale of Regional, if completed.
There is no assurance that Rio Vista’s will be successful in
selling Regional or if the proceeds from the sale will be in the
amounts as described in the LOI and/or if the proceeds will be
sufficient to satisfy existing obligations. Additional information
regarding risks affecting Rio Vista’s business may be found in Rio
Vista’s most recent reports on Form 8-K, Form 10-Q and Form 10-K
filed with the Securities and Exchange Commission.
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