P.M.I. TRADING LIMITED
--------------------------------------------------------------------------------
MARCH 31, 2000.
DTIR-010-00.
TO: PENN OCTANE CORPORATION.
ATT'N: MR. J.B. RICHTER. / JORGE BRACAMONTES.
FAX: (415)368 1505. / 543 6837
P.M.I. TRADING LIMITED, IS PLEASED TO CONFIRM THE "LPG MIX" PURCHASE CONTRACT,
ACCORDING TO THE FOLLOWING TERMS AND CONDITIONS:
(1) PMI ORDER NO.: WILL BE INFORMED MONTH BY MONTH IN OUR FAX OPERATION.
PLEASE REFER IN ALL DOCUMENTS TO PMI'S ORDER NUMBER.
(2) BUYER: P.M.I. TRADING LIMITED
------------------------
ADDRESS: AV. MARINA NACIONAL No. 329
TORRE EJECUTIVE, PISO 20
COL. HUASTECA
11311 MEXICO, D.F.
COMMERCIAL CONTACT
-------------------
NAME: YURI CARRENO / LUIS FELIPE VACA / ANASOL MUNOZ PUENTE
TELEPHONE No: (52-5) 227-0124/227-0159/227-0158
TELEX No.: 1773671/1773509
FAX No.: (52-5) 227-0140/(713) 567-0140
OPERATIONS CONTACT
-------------------
NAME: VICTOR GOMEZ / ALEJANDRO RAMIREZ / IVAN ARIZAGA
TELEPHONE No: (52-5) 227-0114 / 227-0149/227-0157
TELEX No.: 1773671/1773509
FAX No.: (52-5) 227-0111/(713) 567-0111
FINANCIAL CONTACT
------------------
NAME: JUAN CARLOS CABALLERO / ARMANDO CONTRERAS /
FRANCISCO CERVANTES
TELEPHONE No: (52-5) 227-0073
TELEX No.: 1773671/1773509
FAX No.: (52-5) 227-0072/(713) 567-0072
--------------------------------------------------------------------------------
AV. MARINA NACIONAL 329 TELEX: 1773669 PMIME
TORRE EJECUTIVA, PISO 20 FAX: 227-0140
COL. HUASTECA Tel: 227-0121
MEXICO, D.F. C.P. 11311 Tel: 227-0159
<PAGE>
DTIR-010-00.
Page no. 2.
(3) SELLER: PENN OCTANE CORPORATION
ADDRESS: 77-530 ENFIELD LANE
BUILDING D
92211 PALM DESERT CALIFORNIA
COMMERCIAL CONTACT
-------------------
NAME: MR. JORGE R. BRACAMONTES.
TELEPHONE No: (525) 687 6513/687 1189.
FAX No.: (525) 543 6837.
OPERATIONS CONTACT
-------------------
NAME: MR. PEDRO PRADO/HUGO HERNANDEZ.
TELEPHONE No.: (956) 7930235.
CARRETERA LA ROSITA-LUCIO BLANCO KM. 3.4
LA GLORIA, TAMAULIPAS.
FINANCIAL CONTACT
------------------
NAME: MR. IAN BOTHWELL
TELEPHONE No.: (562) 929 1984.
FAX No: (562) 929 1921.
(4) GENERAL AGREEMENT
------------------
4.1. SUBJECT TO ALL TERMS AND CONDITIONS OF THIS AGREEMENT, BUYER SHALL
PURCHASE "LPG MIX" ( AS HEREIN DEFINED ) FROM SELLER AND SELLER AGREES TO
SELL "LPG MIX" TO BUYER UNDER THE TERMS OF THIS AGREEMENT. AS USED IN THIS
AGREEMENT, "LPG MIX" IS A PROPANE/BUTANE PRODUCT MIXTURE CONSISTING OF 90
PERCENT VOL PROPANE AND 10 PERCENT VOL COMMERCIAL BUTANE.
4.2. COMMERCIAL TERMS:
-----------------
DAF (DELIVERED AT FRONTIER) MATAMOROS, MEXICO AT PENN OCTANE'S PIPELINE IN
ACCORDANCE WITH INCOTERMS 2000.
(5) TERM
----
UNLESS EITHER PARTY BREACHES ITS OBLIGATION UNDER THIS AGREEMENT, THE TERM
SHALL BE ONE YEAR COMMENCING ON APRIL 1, 2000 AND CONCLUDING ON MARCH 31,
2001. WITH AN ALTERNATIVE TO EXTEND FOR TWO MORE YEARS THIS CONTRACT WITH
PRIOR NOTICE SIGNED BY BOTH PARTIES.
--------------------------------------------------------------------------------
AV. MARINA NACIONAL 329 TELEX: 1773669 PMIME
TORRE EJECUTIVA, PISO 20 FAX: 227-0140
COL. HUASTECA Tel: 227-0121
MEXICO, D.F. C.P. 11311 Tel: 227-0159
<PAGE>
DTIR-010-00.
Page no. 3.
IN CASE SELLER OBTAINS LEGAL RIGHTS TO IMPORT LPG. MIX INTO MEXICO OR/AND
IF BURGOS BASIN STARTS PRODUCING, THEN EITHER PARTY SHALL HAVE THE RIGHT TO
NOTIFY THE OTHER PARTY ITS INTENTION TO BEGIN A RENEGOTIATION PROCESS OF
THIS CONTRACT. SUCH RENEGOTIATION PROCESS SHALL START NO LATER THAN 10 DAYS
AFTER THE NOTIFICATION IS GIVEN. RENEGOTIATION PROCESS CAN NOT ENDURE MORE
THAN 60 DAYS. IF AN AGREEMENT IS REACHED DURING THE RENEGOTIATION PROCESS
THIS CONTRACT SHALL BE MODIFIED BY MUTUALLY AGREEMENT. OTHERWISE EITHER
PARTY SHALL HAVE THE RIGHT TO CANCEL.
(6) VOLUMES
-------
6.1. BUYER WILL SCHEDULE, PURCHASE AND ACCEPT AND SELLER WILL DELIVER AN
ANNUAL VOLUME OF "LPG MIX" EQUAL TO 108,000,000 GALLONS +/- 10% AT BUYER'S
OPTION, COMPLYING WITH THE FOLLOWING MINIMUM MONTHLY VOLUMES:
WINTER SEASON MINIMUM 10,000,000 GALLONS PER MONTH +/- 10%
SUMMER SEASON MINIMUM 8,000,000 GALLONS PER MONTH +/- 10%
SUCH VOLUMES TO BE REFERRED HEREIN AS "MINIMUM MONTHLY VOLUME"
--------------------------
SEASONALITY IS DEFINED AS DESCRIBED BELOW:
------------------------------------------
WINTER SEASON SHALL MEAN THE PERIOD FROM OCTOBER 2000 THROUGH MARCH 2001.
-------------
SUMMER SEASON SHALL MEAN THE PERIOD FROM APRIL 2000 THROUGH SEPTEMBER 2000.
-------------
6.2. BUYER WILL SCHEDULE ITS LIFTING OF "LPG MIX" WITH SELLER FOR EACH
DELIVERY MONTH AT LEAST SEVEN NATURAL DAYS BEFORE THE BEGINNING MONTH OF
DELIVERIES.
6.3. BUYER WILL ACCEPT DELIVERY OF THE "LPG MIX" VIA TRUCK AT TERGAS S.A.
DE C.V. TERMINAL IN MATAMOROS (THE TERMINAL) AS SCHEDULED BY BUYER, AS LONG
AS IT MEETS THE SPECS DESCRIBED THE ATTACHMENT "A".
(7) PRICE OF "LPG MIX"
---------------------
7.1. PRICE FORMULA FOR PROPANE AND BUTANE SHALL BE BASED ON THE MONTHLY
AVERAGE OF THE DELIVERY MONTH, AS PUBLISHED BY OPIS (OIL PRICE INFORMATION
SERVICE) UNDER MT. BELVIEU NON-TET SPOT POSTINGS FOR 90% PROPANE AND 10%
NON-BUTANE, PLUS A SERVICE COST TO BE DETERMINED IN ACCORDANCE WITH CLAUSE
8 OF THIS AGREEMENT.
7.2. THE ESTIMATED PRICE FOR TEMPORARY INVOICING PURPOSES WILL BE THE
POSTING PRICE OF THE FIFTH DAY QUOTATIONS PRIOR TO THE DELIVERY MONTH, PLUS
THE SERVICE COSTS OF XXXXX USD/GAL. AFTER DELIVERY MONTH ENDS, AN
ADJUSTMENT SHALL BE MADE (AS DESCRIBED IN PARAGRAPH 9.2 BELOW) SO AS TO
REFLECT THE FINAL PRICE COMPUTED AS PER SUBCLAUSE 7.1.
(8) SERVICE COST DETERMINATION
----------------------------
8.1 THE SERVICE COST FOR THE CONTRACTUAL VOLUME LIFTED SHALL BE XXXXX
USD/GAL.
--------------------------------------------------------------------------------
AV. MARINA NACIONAL 329 TELEX: 1773669 PMIME
TORRE EJECUTIVA, PISO 20 FAX: 227-0140
COL. HUASTECA Tel: 227-0121
MEXICO, D.F. C.P. 11311 Tel: 227-0159
<PAGE>
DTIR-010-00.
Page no. 4.
8.2. ALTERNATIVE DELIVERY POINT. BOTH PARTIES AGREE THAT IN CASE OF ANY
-----------------------------
OPERATIONAL PROBLEMS THAT COULD AVERT THE DELIVERIES TO MATAMOROS, THE
PRODUCT CAN BE DELIVERED EXW BROWNSVILLE WITH A DISCOUNT OF XXX CPG TO THE
SERVICE COST, THIS DISCOUNT SHALL BE DECREASED OR INCREASED ACCORDING TO
THE FREIGHT PUBLISHED BY PGPB FOR THE ROUTE "BROWNSVILLE TO MATAMOROS", IN
AN U.S. CENTS PER GALLON BASIS.
8.3. IF THE ACTUAL VOLUME LIFTED AT THE END OF ANY MONTH IS HIGHER THAN THE
MONTHLY NOMINATED VOLUME (PLUS) +10%, THEN THE SERVICE COSTS FOR THE
GALLONS EXCEEDING THE "MONTHLY NOMINATED VOLUME" +10% SHOULD BE NEGOTIATED
BETWEEN SELLER AND BUYER, SUCH NEGOTIATION SHOULD NOT EXCEED 3 WORKING DAYS
UPON NOTICE FORM BUYER TO SELLER.
(9) INVOICING
---------
9.1 SELLER WILL INVOICE BUYER EVERY WEEK FOR THE TOTAL VOLUME LOADED DURING
THE IMMEDIATELY PRECEDING WEEK.
9.2 THE PRICE PER GALLON INVOICED WILL BE ACCORDING TO THE ESTIMATED PRICE
AS DESCRIBED IN SUBCLAUSE 7.2. THE ADJUSTMENT FOR THE ACTUAL PRICE AND
SERVICE COST SHOULD BE INVOICED THROUGH DEBIT/CREDIT NOTES TO BUYER IN THE
FIRST WEEK OF THE FOLLOWING MONTH TO DELIVERY MONTH.
9.3 ALL THE INVOICES MUST COMPLY WITH THE BUYER'S TREASURE DEPARTMENT
INSTRUCTIONS AND SHALL BE SENT TO THE ATTENTION OF ARMANDO
CONTRERAS/FRANCISCO CERVANTES.
(10) PAYMENT TERMS
--------------
FULL NET CASH IN U.S. DOLLARS PAYABLE WITHIN 12 DAYS AFTER ORIGINAL INVOICE
IN HARD COPY IS RECEIVED BY BUYER IN ITS OFFICES, TREASURY DEPARTMENT (AV.
MARINA NACIONAL 329, TORRE EJECUTIVA PISO 20).
A FAX TRANSMISSION OF THE CORRESPONDING INVOICE WILL BE ACCEPTABLE TO BUYER
IN ORDER TO REVIEW IT AS SOON AS POSSIBLE AND TO ASSURE PROMPT PAYMENT AS
OUTLINED IN THE ABOVE PARAGRAPH TO SELLER, IN ACCORDANCE WITH THE PAYMENT
TERMS HEREIN AGREED. HOWEVER, ORIGINAL INVOICE MUST BE RECEIVED AT LEAST 7
DAYS PRIOR TO PAYMENT DUE DATE.
IN CASE THAT THE PAYMENT DATE FALLS ON A SUNDAY OR HOLIDAY, THEN THE
PAYMENT DATE WILL BE THE NEXT WORKING DATE. IN CASE THAT THE PAYMENT DATE
FALLS ON A SATURDAY, THE PAYMENT DATE WILL BE PRIOR WORKING DATE.
(11) SCHEDULE OF SERVICE
---------------------
11.1 SELLER WILL PROVIDE LOADING SERVICES AT THE TERMINAL SEVEN DAYS A
WEEK, TWENTY-FOUR HOURS PER DAY, UNLESS BOTH PARTIES DETERMINE THAT IT IS
NOT NECESSARY TO HAVE PERSONNEL 24 HOURS A DAY, BASED UPON OPERATIONAL
EXPERIENCE DEVELOPED ON SITE. HOURS OF SERVICE SHALL BE SUBJECT TO
AVAILABILITY OF BUYER'S AUTHORIZED PERSON(S) TO DISPATCH THE "LPG MIX" FROM
THE TERMINAL.
--------------------------------------------------------------------------------
AV. MARINA NACIONAL 329 TELEX: 1773669 PMIME
TORRE EJECUTIVA, PISO 20 FAX: 227-0140
COL. HUASTECA Tel: 227-0121
MEXICO, D.F. C.P. 11311 Tel: 227-0159
<PAGE>
DTIR-010-00.
Page no. 5.
11.2. SELLER WILL PROVIDE BUYER A DAILY ACTIVITY REPORT SPECIFYING THE
QUANTITY (WEIGHT AND VOLUME) AND QUALITY OF THE "LPG MIX" DELIVERED TO
BUYER AT THE TERMINAL, AS PER INDEPENDENT INSPECTOR REPORTS. IN ADDITION TO
THIS, SELLER WILL PROVIDE A MONTHLY BASIS REPORT OF ITS INVENTORIES OF "LPG
MIX" PRESENT IN THE TERMINAL AT THE END OF EVERY CALENDAR MONTH.
(12) OFFICE EXPENSE
---------------
SELLER SHOULD PROVIDE TELEPHONE, TELEFAX, CLEANING SERVICES AND SECRETARIAL
EXPENSES INCURRED BY PEMEX GAS REPRESENTATIVES SUPERVISING RECEIPT OF THE
"LPG MIX" DELIVERIES AT SELLER'S TERMINAL AT BROWNSVILLE, TX. SELLER SHALL
INVOICE (A MAXIMUM OF 2,100 USD) EVERY MONTH FOR THOSE SERVICES AT THE END
OF EACH MONTH, AND BUYER SHALL PAY FIFTEEN DAYS AFTER INVOICE RECEIPT AS
PER BUYER'S TREASURY DEPARTMENT INSTRUCTIONS.
IF THE PAYMENT DATE IS A WEEKEND OR HOLIDAY, PAYMENT SHALL BE MADE ON THE
NEXT BUSINESS DAY.
(13) QUALITY
-------
THE "LPG MIX" SHALL MEET THE SPECIFICATIONS ATTACHED AS EXHIBIT "A"
(14) MEASUREMENT
-----------
14.1. THE QUANTITY OF PRODUCT DELIVERED SHALL BE DETERMINED BY NET WEIGHT,
AND FOR PAYMENT PURPOSES. THE WEIGHT OF THE "LPG MIX" DELIVERED TO BUYER
WILL BE CONVERTED TO VOLUME (CORRECTED TO 60 F) VIA ANALYSIS OF SAMPLES
USING A GAS CHROMATOGRAPH, THE CHROMATOGRAPH MUST BE CALIBRATED ACCORDING
TO THE ASTM AND GPA PROCEDURES. BUYER AND SELLER WILL CAUSE AN INDEPENDENT
INSPECTOR, MUTUALLY AGREED BY THE PARTIES, TO SAMPLE AND ANALYZE EACH LOAD
OF THE "LPG MIX". THE COST OF SUCH INSPECTIONS WILL BE PAID BY BOTH PARTIES
EQUALLY.
14.2. BEFORE ENTERING THE TERMINAL, EMPTY TRUCKS WILL BE WEIGHTED AT THE
PORT OF BROWNSVILLE PUBLIC SCALES OR AT THE TERMINAL OF MATAMOROS OR OTHER
SCALE MUTUALLY AGREED BY BOTH PARTIES. LOADED TRUCK WILL BE WEIGHTED AT THE
SAME SCALE UPON DEPARTURE. THE VOLUME OBTAINED BY THE DIFFERENTIAL BETWEEN
THESE TWO MEASUREMENTS SHALL BE THE VOLUME TO BE INVOICED BY SELLER AND
PAID BY BUYER. THE SCALE WILL BE TESTED AND ADJUSTED TO ACCURACY AT LEAST
ONCE EVERY 30 DAYS OR ACCORDING TO GOVERNMENT REGULATIONS. THE COSTS OF
WEIGHTING THE TRUCKS BEFORE AND AFTER LOADING, AND/OR IF A THIRD PARTY IS
REQUIRED TO TEST OR CALIBRATE THE SCALE, WILL BE SHARED BY SELLER. IF
SELLER, AT ANY TIME, INSTALLS SCALES AT THE TERMINAL, THEY WILL THEREAFTER
BE THE SCALES FOR ALL TRUCKS RECEIVING "LPG MIX" AT THE TERMINAL, AND THEY
SHOULD BE OPERATED AND MAINTAINED IN ACCORDANCE WITH THE ABOVE PROVISION,
THE CHARGE FOR SUCH SCALES SHALL BE 100% FOR SELLERS ACCOUNT.
IF SELLER'S SCALE IS USED, THEN BUYER SHALL HAVE THE RIGHT TO SEND TRUCKS
TO AN INDEPENDENT SCALE IN A RANDOMLY BASIS EVERY WEEK, IN ORDER TO CHECK
SELLER'S SCALE ACCURACY, COSTS OF INDEPENDENT SCALE SHALL BE ON BUYER'S
ACCOUNT.
--------------------------------------------------------------------------------
AV. MARINA NACIONAL 329 TELEX: 1773669 PMIME
TORRE EJECUTIVA, PISO 20 FAX: 227-0140
COL. HUASTECA Tel: 227-0121
MEXICO, D.F. C.P. 11311 Tel: 227-0159
<PAGE>
DTIR-010-00.
Page no. 6.
(15) TITLE AND RISK
----------------
TITLE OF THE "LPG MIX" WILL PASS FROM SELLER TO BUYER AT THE U.S. - MEXICAN
FRONTIER BY THE PIPELINE.
RISK OF LOSS OF THE "LPG MIX" WILL PASS FROM SELLER TO BUYER AT OUTLET
FLANGE OF THE TRUCK AT THE LOADING RACKS LOCATED AT THE TERMINAL. AT SUCH
POINT, THE "LPG MIX" SHALL BE DEEMED TO BE DELIVERED.
(16) LAW AND ARBITRATION
---------------------
THE AGREEMENT SHALL BE GOVERNED BY AND INTERPRETED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK. ALL DISPUTES ARISING OUT OF OR RELATING TO
THE AGREEMENT SHALL BE SETTLED BY FINAL ARBITRATION IN THE STATE OF NEW
YORK, CITY OF N.Y. CONDUCTED IN ACCORDANCE WITH THE RULES OF CONCILIATION
AND ARBITRATION OF THE AMERICAN ARBITRATION ASSOCIATION IN EFFECT AT SUCH
TIME. THE NUMBER OF ARBITRATORS SHALL BE THREE.
(17) SPILL/ENVIRONMENTAL POLLUTION
------------------------------
IN THE EVENT OF ANY "LPG MIX" SPILL OR OTHER ENVIRONMENTAL POLLUTING
DISCHARGE OCCURS PRIOR TO DELIVERY, AS THE SAME IS DEFINED IN ARTICLE 15 OF
THIS AGREEMENT, ALL CLEAN-UP OPERATIONS THAT MAY BE REQUIRED BY ANY
GOVERNMENTAL AUTHORITIES, SHALL BE FOR SELLER'S ACCOUNT.
IF SUCH SPILL OR ENVIRONMENTAL POLLUTING DISCHARGE OCCURS AFTER DELIVERY,
AS THE SAME AS DEFINED IN ARTICLE 15 OF THIS AGREEMENT, ALL CLEAN-UP
OPERATIONS THAT MAY BE REQUIRED, SHALL BE FOR BUYER'S ACCOUNT.
IN THE EVENT THAT SUCH SPILL OR ENVIRONMENTAL POLLUTING DISCHARGE OCCURS
AFTER DELIVERY, AT THE TERMINAL, BUYER AUTHORIZES SELLER TO COMMENCE
CONTAINMENT OR CLEAN-UP OPERATIONS AS DEEMED APPROPRIATE OR NECESSARY BY
SELLER OR AS MAY BE REQUIRED BY ANY GOVERNMENTAL AUTHORITIES. SELLER WILL
NOTIFY BUYER IMMEDIATELY OF SUCH OPERATIONS. SELLER SHALL HAVE THE RIGHT TO
DIRECT ALL CONTAINMENT AND CLEAN-UP OPERATIONS. ALL COSTS OF CONTAINMENT
AND CLEAN-UP FOR SUCH SPILL WILL BE BORNE BY BUYER, AND BUYER SHALL
INDEMNIFY AND HOLD SELLER HARMLESS FROM ANY AND ALL EXPENSES, CLAIMS,
LIABILITIES, DAMAGES, PENALTIES, FINES AND OTHER COSTS (INCLUDING, WITHOUT
LIMITATION, ATTORNEYS FEES) RESULTING OR RELATED TO SUCH INCIDENT.
FOLLOWING THE INDEMNITY OF SELLER BY BUYER, SELLER WILL COOPERATE WITH
BUYER FOR THE PURPOSE OF OBTAINING REIMBURSEMENT IN THE EVENT THAT ANY
NON-AGENT THIRD PARTY IS LEGALLY RESPONSIBLE FOR ANY COSTS OR EXPENSES
BORNE BY BUYER UNDER THIS PARAGRAPH.
IN THE EVENT THAT SUCH SPILL OR ENVIRONMENTAL POLLUTING DISCHARGE OCCURS
AFTER DELIVERY, OUT THE OF THE TERMINAL, BUYER MAY AUTHORIZE SELLER TO
COMMENCE CONTAINMENT OR CLEAN-UP OPERATIONS AS DEEMED APPROPRIATE OR
NECESSARY BY SELLER OR AS MAY BE REQUIRED BY ANY GOVERNMENTAL AUTHORITIES.
SELLER WILL NOTIFY BUYER IMMEDIATELY OF SUCH OPERATIONS. SELLER SHALL HAVE
THE RIGHT TO DIRECT ALL CONTAINMENT AND CLEAN-UP OPERATIONS. ALL COSTS OF
CONTAINMENT AND CLEAN-UP FOR SUCH SPILL WILL BE BORNE BY BUYER, AND BUYER
SHALL INDEMNIFY AND HOLD SELLER HARMLESS FROM ANY AND ALL EXPENSES, CLAIMS,
LIABILITIES, DAMAGES, PENALTIES,
--------------------------------------------------------------------------------
AV. MARINA NACIONAL 329 TELEX: 1773669 PMIME
TORRE EJECUTIVA, PISO 20 FAX: 227-0140
COL. HUASTECA Tel: 227-0121
MEXICO, D.F. C.P. 11311 Tel: 227-0159
<PAGE>
DTIR-010-00.
Page no. 7.
FINES AND OTHER COSTS (INCLUDING, WITHOUT LIMITATION, ATTORNEYS FEES)
RESULTING OR RELATED TO SUCH INCIDENT. FOLLOWING THE INDEMNITY OF SELLER BY
BUYER, SELLER WILL COOPERATE WITH BUYER FOR THE PURPOSE OF OBTAINING
REIMBURSEMENT IN THE EVENT THAT ANY NON-AGENT THIRD PARTY IS LEGALLY
RESPONSIBLE FOR ANY COSTS OR EXPENSES BORNE BY BUYER UNDER THIS PARAGRAPH.
(18) SAFETY
------
BUYER WILL COMPLY, AND WILL CAUSE BUYER'S EMPLOYEES, AGENTS AND OTHERS
ENTERING THE TERMINAL ON BEHALF OF BUYER TO COMPLY, WITH ALL TERMINAL
SAFETY AND HEALTH REGULATIONS. SELLER WILL EXECUTE IN ITS NAME, PAY FOR,
AND FURNISH TO BUYER PRIOR TO ACCEPTING ANY "LPG MIX" AT THE TERMINAL, ALL
INFORMATION (INCLUDING APPLICABLE MATERIAL DATA SHEETS), DOCUMENTS, LABELS,
PLACARDS, CONTAINERS, AND OTHER MATERIALS WHICH MAY BE REQUIRED TO BE
FURNISHED BY BUYER BY STATUES, ORDINANCES, RULES OR REGULATIONS OF ANY
PUBLIC AUTHORITY RELATING TO THE DESCRIBING, PACKAGING, RECEIVING, STORING,
HANDLING, OR SHIPPING OF THE "LPG MIX" AT OR FROM THE TERMINAL.
(19) FORCE MAJEURE
--------------
NEITHER PARTY SHALL BE LIABLE FOR FAILURE OR DELAY IN THE PERFORMANCE OF
THIS AGREEMENT DUE TO ACTS OF GOD, EARTHQUAKE, FLOOD, FIRE, WAR,
HOSTILITIES, CIVIL COMMOTIONS, GOVERNMENTAL ACTS, STRIKES, TRANSPORTATION
PROBLEMS, PIPELINE STOPPED DUE TO LEAK OR EXPLOSION AND ANY OTHER CAUSE
BEYOND THE CONTROL OF THE EITHER OF THE PARTIES. ANY PARTY CLAIMING FORCE
MAJEURE SHALL PROMPTLY NOTIFY THE OTHER OF THE OCCURRENCE OF THE EVENT OF
FORCE MAJEURE RELIED UPON. EVENTS OF FORCE MAJEURE SHALL NOT RELIEVE ANY
PARTY FROM ANY PAYMENT FOR PRODUCT DELIVERED AND/OR SERVICE RENDERED
HEREUNDER.
(20) LIMITATION OF LIABILITY
-------------------------
SELLER SHALL NOT BE LIABLE FOR MORE THAN THE ACTUAL COST TO REPLACE ANY
"LPG MIX" NOT DELIVERED HEREUNDER. NEITHER PARTY SHALL BE LIABLE FOR
SPECIAL, INDIRECT OR CONSEQUENTIAL DAMAGES.
(21) MISCELLANEOUS
-------------
21.1. AMENDMENTS, WAIVER. THIS AGREEMENT MAY NOT BE CHANGED OR MODIFIED,
--------------------
EXCEPT IN WRITING BY MUTUAL AGREEMENT OF BOTH PARTIES. THE FAILURE OF ANY
PARTY TO ENFORCE ANY OF THE PROVISIONS OF THIS AGREEMENT WILL NOT BE
CONSTRUED TO BE A WAIVER OF THOSE PROVISIONS, OR A WAIVER OF THE RIGHT OF
ANY PARTY TO ENFORCE THEM.
21.2. SEVERABILITY. IF ANY PROVISION OF THIS AGREEMENT IS DETERMINED TO BE
-------------
INVALID OR UNENFORCEABLE, THE REMAINED OF THIS AGREEMENT SHALL REMAIN IN
FULL FORCE AND EFFECT.
--------------------------------------------------------------------------------
AV. MARINA NACIONAL 329 TELEX: 1773669 PMIME
TORRE EJECUTIVA, PISO 20 FAX: 227-0140
COL. HUASTECA Tel: 227-0121
MEXICO, D.F. C.P. 11311 Tel: 227-0159
<PAGE>
DTIR-010-00.
Page no. 8.
21.3. ASSIGNMENT. NEITHER PARTY MAY ASSIGN THIS AGREEMENT OR ANY PORTION OF
-----------
IT WITHOUT THE PRIOR WRITTEN CONSENT OF THE OTHER PARTY.
21.4. OTHER TERMS AND CONDITIONS. THE UNITED NATIONS CONVENTION ON
------------------------------
CONTRACTS FOR THE INTERNATIONAL SALE OF GOODS SHALL NOT APPLY TO THIS
CONTRACT.
21.5. ENTIRE AGREEMENT THIS AGREEMENT CONSTITUTES THE ENTIRE AGREEMENT
-----------------
AMONG THE PARTIES AND SUPERSEDES ALL PREVIOUS NEGOTIATIONS, COMMITMENTS AND
WRITING WITH RESPECT TO SUCH SUBJECT MATTER OF THIS AGREEMENT.
(22) OPERATIONAL PROCEDURE
----------------------
IN ORDER TO COMPLY WITH ALL REGULATIONS IMPOSED BY THE MEXICAN GOVERNMENT
AND ITS ENTITIES, SELLER SHALL BE COMMITTED TO FOLLOW THE PROCEDURE DEFINED
BY PGPB, WHICH WOULD BE PART OF THIS CONTRACT AS "ATTACHMENT "B".
(23) CONFIDENTIALITY
---------------
BOTH PARTIES AGREE TO KEEP ALL TERMS AND CONDITIONS OF THIS AGREEMENT
PRIVATE AND CONFIDENTIAL EXCEPT TO THE EXTENT DISCLOSURE IS REQUIRED UNDER
ANY DISPUTE RELATING HERETO OR UNDER ANY RULE OR REGULATION TO WHICH EITHER
PARTY SHALL BE SUBJECT.
IF THIS MEETS WITH YOUR UNDERSTANDING AND APPROVAL, PLEASE SIGN IN THE
APPROPRIATE SPACE.
BUYER SELLER
YURIA CARRENO JORGE BRACAMONTES
PMI TRADING LIMITED PENN OCTANE CORPORATION
--------------------------------------------------------------------------------
AV. MARINA NACIONAL 329 TELEX: 1773669 PMIME
TORRE EJECUTIVA, PISO 20 FAX: 227-0140
COL. HUASTECA Tel: 227-0121
MEXICO, D.F. C.P. 11311 Tel: 227-0159
<PAGE>
