**Exhibit 10.46****CONSULTING AGREEMENT**THIS CONSULTING AGREEMENT (this “Agreement”) is entered into on this ___th day of June, 2007,with an effective date of November 1, 2006 (the “Effective Date”) by and between Penn OctaneCorporation, a Delaware corporation (“Penn Octane”) and Rio Vista Energy Partners L.P., a Delawarelimited partnership (“Rio Vista”) (Penn Octane and Rio Vista are sometimes collectively referred toas the “Company”) and Ricardo Rodriguez Canney (“Consultant”), as follows:**Recitals**WHEREAS, Consultant has been a member of the Board of Directors of Penn Octane since 2006 andthe Board of Managers of the general partner of Rio Vista since 2004, and currently serves as theChairman for both Boards; andWHEREAS, there have been some preliminary discussions between both Penn Octane and Rio Vistaabout making Consultant a full time employee acting as the chief executive officer for bothentities. These discussions have not resulted in an agreement for such position and the Companycurrently believes that it cannot justify the cost of a full time CEO requiring the compensationConsultant has requested; andWHEREAS, the Company has approached the consultant to perform certain additional servicesbeyond the ordinary scope of a Chairman of a Board and have decided to augment his currentcompensation to reflect the value of the additional requested services; andWHEREAS, the Parties have agreed to enter into this Agreement in resolution of all priornegotiations.**Agreement**THEREFORE, In consideration of the covenants and agreements contained herein, the partiesagree as follows:**Section 1: Engagement of Services****1.1****Services Performed by Consultant****.**Consultant shall serve as a special advisor to PennOctane and Rio Vista and shall provide the following services (the “Services”) to the Company: (a)assistance with the Company’s identification and completion of acquisition and disposition ofassets, obtaining financings, development of new projects, (b) identifying, engaging andrecommending candidates for roles in the Company’s management teams and boards; (c) assistance withother transactions involving the Company, and (d) such other services as may be reasonablyrequested by the Company. Consultant’s duties may be reasonably modified at the Company’sdiscretion from time to time. Consultant will report directly to the board of directors of PennOctane and the board of managers of the general partner of Rio Vista.
 
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Consultant shall at all times faithfully and diligently perform the Services under thisAgreement and use Consultant’s best efforts, skill, and attention for the fulfillment of theServices and the interests of the Company. Consultant shall have discretion and control of therendering of the Services and the manner in which said Services are performed. Consultant shallperform all such Services under the name and as a representative of the Company to any thirdparties engaged in discussions with the Company. Unless otherwise agreed to by the parties,Consultant shall have no obligation to work any particular hours or days, nor shall Consultant beobligated to devote full time to the performance of the Services. It is, however, expected thatconsultant will work no less than 80 hours per month.**1.2****Company Affiliates**. Consultant acknowledges and agrees that the Company may, from timeto time, request Consultant to provide the Services or such other related services to any of theCompany’s Affiliates, subject to the terms and conditions of this Agreement. For purposes of thisAgreement, “Affiliates” shall mean a parent company, or an affiliated or subsidiary corporation orany other legal entity that is owned, whether entirely or partially, or controlled by the Company.As used in this definition, “owned or controlled by” means owns or holds the right to vote any ofthe stock or units of such entity, including without limitation, the Company’s affiliated limitedpartnerships and limited liability companies in the United States and the Company’s affiliatedentities in Mexico. To the extent that the Consultant provides any services to the Affiliates,such Affiliates would have all the rights and benefits provided to the Company hereunder, as ifsuch Affiliates were the Company.**1.3****Independent Contractor****.**Consultant enters into this Agreement as, and shall continueto be, an independent contractor. Under no circumstances shall Consultant look to the Company ashis employer, or as a partner, agent or principal. There shall be no tax withholdings taken fromany Fees paid to Consultant pursuant to this Agreement (including, without limitation, FICA, stateand federal unemployment compensation contributions, and state and federal income taxes), andConsultant shall pay, when and as due, any and all taxes incurred as a result of Consultant’scompensation pursuant to this Agreement. Upon request, Consultant shall provide the Company withproof of such payment.Consultant will indemnify and hold harmless the Company from and against all claims, damages,losses and expenses, including reasonable fees and expenses of attorneys and other professionals,relating to Consultant’s failure to pay such taxes as well as any obligation imposed by law on theCompany to pay any withholding taxes, social security, unemployment or disability insurance, orsimilar items in connection with compensation received by Consultant pursuant to this Agreement.Consultant also understands and agrees that Consultant shall be solely responsible forcomplying with all federal, state, and local laws requiring business permits, certificates, andlicenses required to carry out the Services to be performed by Consultant under this Agreement.Furthermore, Consultant recognizes that it is Consultant’s responsibility to obtain all insurancecoverage (including workers’ compensation) for Consultant. Upon request, Consultant shall providethe Company with proof of such coverage.
 
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**1.4****Agency****.**It is expressly understood and agreed that Consultant shall only represent theCompany to the extent expressly authorized by this Agreement, and in no other way, and thatConsultant shall not be an agent of the Company. In this regard, Consultant shall have noauthority to enter into any agreements or other binding obligations on the Company’s behalf withoutthe prior specific written authorization of the Company, and that Consultant shall not hold himselfout as an officer, employee or agent of the Company; provided, however, that Consultant may holdhimself out as the Chairman of the Board of both Penn Octane and Rio Vista (for as long as this isaccurate) or otherwise as a representative of the Company as specifically authorized by thisAgreement or by the Company.**Section 2: Compensation****2.1****Payment of Fees****.**In consideration of the Services rendered by Consultant to theCompany and/or to the Affiliates, the Company agrees to pay the following fees (“Fees”) toConsultant:(a) Within ten (10) days of the completed execution of this Agreement, Consultant shall bepaid $66,667.00 (including unpaid board fees), in consideration for additional services performedby Consultant for November 1, 2006 through May 31, 2007.(b) Starting June 1, 2007, Consultant shall be paid a total of $12,500 per month for allservices rendered under this Agreement, in two monthly payments of $6,250, payable at the middleand end of each calendar month. Such amounts are to be paid equally by Penn Octane and Rio Vista.Said monthly fee will include, and not be in addition to, any sum otherwise due and owing toConsultant for services performed by Consultant as a member of the Board of Directors of PennOctane, Board of Managers of the general partner of Rio Vista, or otherwise based on Consultant’sposition as a member and the Chairman of either Board. Without limiting the generality of theforegoing, such monthly fee shall include all amounts payable to Consultant pursuant to a ChairmanServices Agreement between Consultant, Penn Octane and Rio Vista.(c) Provided Consultant is still providing services under this Agreement at the date ofpayment, Consultant shall be eligible for a bonus, at the sole and absolute discretion of theindependent members of the Boards of the Company, of up to $125,000 for calendar year 2007. Theamount of said bonus, if any, shall be determined no later than February 15, 2008 and paid withinten (10) business days thereafter.(d) Consultant, as well as his wife, shall receive medical insurance benefits consistent withthe Company’s then current plan offered to senior executives in the Company.(e) Within thirty (30) days of the execution of this Agreement, subject to restrictions ontiming pursuant to applicable state and federal law, Consultant will receive stock options topurchase 270,224 shares in Penn Octane, at the then current fair market value as of the date of thegrant, and 26,963 units in Rio Vista, at the then current fair market value as of the date of thegrant. Pursuant to the terms of said grants, 25% of these options will vest on February 1, 2008,with the remaining unvested options vesting equally on a monthly basis for the thirty–six (36)months following February 1, 2008. All other terms will remain subject to the current equity plansand forms of option agreement of Rio Vista and Penn Octane.
 
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**2.2****Expenses****.**Consultant shall provide receipts for all actual, reasonable travel andother out-of-pocket expenses incurred by Consultant as necessary in connection with the performanceof the Services by Consultant. Consultant agrees to submit to the Company such documentation asmay be necessary to substantiate all such expenses and reimbursements for deduction by the Companyas reasonable and necessary under Section 162 of the Internal Revenue Code. Consultant will usehis best efforts to submit all expenses for reimbursement at the end of each calendar month. Noexpense claim submitted by Consultant more than ninety (90) days after incurred shall bereimbursed.**2.3****Taxes.** Fees do not include taxes. To the extent that Consultant is required to pay anyfederal, state or local income, sales, use, property or value-added taxes based upon the Feesand/or the Services provided under this Agreement, such taxes shall be the sole responsibility ofConsultant.**Section 3: Term; Termination****3.1****Term**. The term of this Agreement is at will. The Consultant may terminate thisAgreement, with or without cause, at any time upon thirty (30) days’ written notice to the Company.The Company may terminate this Agreement, with or without cause at any time upon written notice toConsultant, subject to Consultant’s potential right to severance benefits set forth inSection 3.4. The provisions of this Agreement specified in Section 3.4 shallsurvive the expiration or termination of this Agreement.**3.2****Resumption of Chairman’s Fees**. If Consultant terminates this Agreement or Companyterminates this Agreement without cause, and if Consultant is still Chairman of the Board of theboard of directors of Penn Octane, and, or, of the board of managers of Rio Vista, then Penn Octaneand, or, Rio Vista shall resume paying Chairman’s Fees as per the current Chairman ServicesAgreements between Consultant and each of the companies, commencing on the date of termination ofthis Agreement.**3.3****Final Payments**. Following termination of this Agreement in accordance with Section3.1, any accrued, but unpaid, Fees shall be shall be paid to Consultant in accordance withSection 2.1. Within thirty (30) days following the date of such termination, Consultantshall submit a final expense reimbursement request to the Company in accordance with Section2.2.**3.4****Severance.** In the event the Company terminates this Agreement without “Cause”, asdefined below, and in return for a complete release satisfactory to the Company, signed byConsultant, of any and all claims he may have against the Company, Consultant shall be entitled tothe following severance benefits:(a) Continued payment of $12,500 a month for three (3) months after notice of termination;(b) Continued medical benefits for Consultant and his wife for three full months after themonth of termination;
 
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(c) In the event said termination takes place before February 1, 2008, acceleration of 25% ofhis vesting in both the Penn Octane stock options grant and Rio Vista unit options grant awardedunder this Agreement, so that, for purposes of vesting only, Consultant will have the right toexercise the same number of options as if he was terminated on February 1, 2008.Consultant will not receive any of the foregoing severance benefits in the event hevoluntarily terminates his employment, is terminated for Cause, or if his employment is terminatedby death or disability. Consultant further agrees to cooperate with the Company in answeringquestions and providing information regarding the Company, and his prior actions on behalf of theCompany, for ninety (90) days after his termination.For purposes of this Agreement, “Cause” shall mean:(a) any act or omission constituting a material breach by Consultant of any provisions of thisAgreement;(b) the failure by Consultant to perform his duties or assignments hereunder (other than anysuch failure resulting from Consultant’s mental or physical disability), after demand forperformance is delivered by the Company that identifies the manner in which the Company believesConsultant has not performed his duties or assignments, if, within ten days of such demand,Consultant fails to cure any such failure (No notice or cure right will be given in the event thefailure is of a nature that cannot be cured within ten days);(c) any intentional act or misconduct injurious to the Company or any Affiliate, financial orotherwise, or including, but not limited to, misappropriation, fraud including with respect to theCompany’s accounting and financial statements, embezzlement or conversion by Consultant of theCompany’s or any of its Subsidiary’s property in connection with Consultant’s duties or in thecourse of Consultant performing services for the Company;(d) the conviction (or plea of no contest) of the Consultant for any felony or the indictmentof the Consultant for any felony including, but not limited to, any felony involving fraud, moralturpitude, embezzlement or theft in connection with the Consultant’s duties or in the course of theConsultant’s employment with the Company;(e) the commission of any intentional or knowing violation of any antifraud provision of thefederal or state securities laws;(f) there is a final, non-appealable order in a proceeding before a court of competentjurisdiction or a final order in an administrative proceeding finding that Consultant committed anywillful misconduct or criminal activity (excluding minor traffic violations or other minoroffenses) which commission is materially inimical to the interests of the Company or anySubsidiary, whether for his personal benefit or in connection with his duties for the Company orany Subsidiary;(g) current alcohol or prescription drug abuse affecting work performance; or(h) current illegal use of drugs.
 
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**Section 4: Confidentiality.****4.1****Duty to Maintain Confidential Information.**(a) The Company and the Affiliates have previously furnished to Consultant, and may continueto furnish to Consultant, such information, proprietary data and access to the Company’s personneland records (all such information and access, “Information”) as reasonably necessary and/orappropriate for Consultant to perform the Services, the confidentiality of which gives the Companyand the Affiliates a competitive advantage in its business. As used herein, the term “Information”is to be broadly construed and includes, but is not limited to, (i) presentations, ideas, tradesecrets, processes, systems, techniques, formulas, source and object code, data, programs,know-how, flowcharts, methods, compounds, diagrams, drawings, models, specifications, improvements,discoveries, developments, designs, and other works of authorship, whether patented or registeredfor trademark or copyright protections, if any, (ii) information regarding marketing, sales,licensing, accounting, product or service development, assets, competitive analyses, unpublishedfinancial statements, budgets, forecasts, prices, costs, business plans, research and developmentplans, clients, client marketing, research and any other confidential client activity, suppliers,and employees, (iii) information relating to potential acquisitions, dispositions and financing ofthe Company and Affiliates, and (iv) any other information of the type which the Company and/or theAffiliates have a legal obligation to keep confidential or which the Company and/or Affiliatetreats as confidential or proprietary, whether or not owned or developed by the Company or theAffiliates. The term “Information” shall also include any and all such Information pertaining tothe Company, its Affiliates, and their respective customers and suppliers.(b) During the time that this Agreement remains in effect and at all times thereafter,Consultant agrees:(1) to keep the Information confidential and not to copy, publish, transmit, or disclose toothers or allow any other party to copy, publish, transmit, or disclose to others, any Information,except in accordance with Consultant’s fiduciary duty to the Company pursuant to this Agreement andin furtherance of the interests of the Company and the Affiliates;(2) to use the Information exclusively for the purpose of performing the Services underthis Agreement and for no other purpose; and(3) that the Information is, shall be, and shall remain the exclusive property of theCompany and the Affiliates, and Consultant shall neither have nor acquire any right, title,or interest therein.(c) The foregoing confidentiality obligations of Consultant shall not apply to any informationthat is (i) a matter of public knowledge (from a source or sources other than Consultant), (ii)independently developed by a person not a party to this Agreement without the use, directly orindirectly, of the Information, (iii) disclosed by a person not a party to this Agreement withoutviolation of any obligation of confidentiality, or (iv) required by law or the order of any courtor governmental agency, or in any litigation or similar proceeding tobe disclosed, provided that Consultant shall, prior to making any such required disclosure, notify the Company and/or theAffiliate in sufficient time to permit them to seek an appropriate protective order.
 
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**4.2.****Third Party Information****.**Consultant understands that the Company and the Affiliateshave received and in the future will receive from third parties confidential or proprietaryinformation (“Third Party Information”) subject to a duty of the Company and the Affiliates to holdsuch information in confidence and to use it only for the limited, authorized purpose of performingits obligations to the third party. Both during and after the term of this Agreement, Consultantwill hold all Third Party Information in the strictest confidence and will not disclose,misappropriate, disseminate, publish, or use it in any manner or form, except as required by theServices for the Company and/or the Affiliates or as expressly authorized in writing by an officerof the Company and/or the Affiliates.**4.3****Breach of Confidentiality.** Both parties agree that in the event of a breach,threatened breach, violation, or evasion of the terms of this Section 4, immediate andirreparable injury shall occur to the Company and/or its Affiliates, that such injury may beimpossible to measure or remedy in monetary damages, and the Company and/or the Affiliates shall beauthorized to seek all equitable remedies, including injunctive relief or specific performance, inaddition to any other legal or equitable remedies that may be available under this Agreement and/orat law.**4.4****Return of Company Information****.**Upon termination of this Agreement or upon request bythe Company and/or the Affiliates, Consultant will promptly deliver to the Company and theAffiliates all drawings, notes, memoranda, presentations, brochures, specifications, programs,reports, and other documents and manifestations, with all copies and any other materials containingor disclosing any Information, Third Party Information or any other materials related to theCompany or the Affiliates or the Services, whether prepared by Consultant or another party.Consultant agrees not to retain any written, electronic or other tangible material containing orconcerning any Information or Third Party Information of the Company and/or the Affiliates and tomaintain the confidentiality of this Information, Third Party Information and materials in thefuture.**4.5****Trading in Company Securities**. Consultant shall not buy, sell or conduct any othertransaction in or relating to the securities of the Company at any time when Consultant is inpossession of material, nonpublic information concerning the Company, its Affiliates, or its ortheir securities. Notwithstanding the foregoing, Consultant may buy, sell or conduct any othertransaction in the securities of the Company directly with the Company or an Affiliate of theCompany at any time. The restrictions contained in this Section 4.5 shall not apply withrespect to information that has been publicly disclosed by the Company in a manner consistent withthe provisions of Rule 101(e) of Regulation FD promulgated under the Securities Exchange Act of1934.**Section 5: Assignment of Ownership****5.1****Work Product****.**(a) Consultant agrees and hereby intends that all information, trade secrets, data,discoveries, programs, business plans, documents, materials and works of authorship or otherintellectual property arising out of, resulting from, related to, or in connection with theServicesprovided by Consultant, or otherwise conceived or discovered by Consultant, alone or withothers, under this Agreement, or in connection with services rendered by Consultant to the Companyor the Affiliates before the Effective Date (collectively, the “Work Product”) are speciallyordered or commissioned works and shall be considered work made for hire as provided in the U.S.Copyright Act (17 U.S.C. 101(2)). All Work Product and the benefits thereof shall immediately andautomatically be the sole and absolute property of the Company and/or the Affiliates, as the casemay be.
 
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(b) In addition to the foregoing, Consultant hereby irrevocably assigns, conveys and transfersto the Company and/or to the Affiliates, their successors and assigns, as the case may be, all ofConsultant’s right, title and interest worldwide in all copyrights, patents, trade secrets,confidential and proprietary rights in and to the Work Product, including any derivations ormodifications thereto and any associated moral rights, and any other work product created byConsultant for the Company or the Affiliates or during any time Consultant is performing servicesfor the Company or the Affiliates. Further, Consultant agrees to execute, verify and deliver suchadditional assignment documentation with respect to the Work Product as the Company or theAffiliates may request from time to time. If Consultant has any rights in and to the Work Productthat cannot be assigned, (i) Consultant hereby unconditionally and irrevocably agrees to waive andhereby does waive enforcement of such rights against Company and the Affiliates, their successors,assigns and licensees, and (ii) Consultant agrees to grant and hereby does grant to Company and theAffiliates, their successors, assigns and licensees, a royalty-free, worldwide, perpetual,irrevocable, exclusive license to use, copy, modify, transfer, offer for sale and distribute theWork Product for any and all legal purposes. In addition, Consultant shall assist the Company andthe Affiliates in obtaining patents, copyrights and any other available legal protection for theWork Product.(c) Nothing in this Section 5.1 shall be interpreted to alter or modify Consultant’sstatus as an independent contractor.**5.2****Enforcement of Rights****.**Consultant shall assist the Company and the Affiliates in everyproper way to obtain, and enforce the Company’s and/or the Affiliates’ United States and foreignrights relating to the Work Product or the Information in any and all countries. To that end,Consultant shall execute, verify, and deliver such documents and perform such other acts (includingappearances as a witness) as the Company or the Affiliates may reasonably request for use inapplying for, obtaining, perfecting, evidencing, sustaining and enforcing such rights and theassignment thereof. If the Company or the Affiliates are unable for any reason to obtainConsultant’s signature, after reasonable effort, on any documentation needed in connection with theforegoing obligations, Consultant hereby irrevocably designates and appoints the Company and theAffiliates and their duly authorized agents as Consultant’s attorney-in-fact to act for and onConsultant’s behalf to execute, verify and file any such documents and to do all other lawfullypermitted acts to further the purposes of this Section 5 with the same legal force andeffect as if executed by Consultant. Consultant hereby irrevocably waives and assigns to theCompany and the Affiliates, any and all claims, of any nature whatsoever, which Consultant now ormay hereafter have against the Company and/or the Affiliates for infringement with respect to anyWork Product.
 
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**Section 6: Restrictive Covenants****6.1****Competing Activities****.**During the period of Consultant’s engagement with the Company,without the prior written consent of the Company: (a) Consultant shall not directly or indirectlyengage in any employment, occupation, consulting, or other business activity which the Companydetermines in good faith to be in competition with the Company or its Affiliates; and (b)Consultant shall not usurp or take advantage of any such business activity without first offeringthe opportunity to the Company and/or the Affiliates.**6.2****Compliance with Laws**. Consultant agrees that in the course of fulfilling Consultant’sresponsibilities under this Agreement, Consultant shall not engage in any conduct, furnish anyinformation or take any other action which would violate or cause the Company to violate any UnitedStates law or lose any United States federal tax benefits, including but not limited to any of theactivities described in or prohibited by The Foreign Corrupt Practices Act of 1977, Section 999 ofThe Internal Revenue Code of 1986, The Export Administration Act of 1984, and all regulationspromulgated thereunder. Furthermore, Consultant agrees that in performing the Services Consultantwill comply with and avoid violation of any other applicable laws of the Mexico, the United Statesof America, the State of California, the State of Texas and any other jurisdiction or politicalsubdivision thereof, including regulations, rules and orders promulgated under such laws andcustoms having the effect of law. Without limiting the generality of the foregoing, Consultantwill not make any offer, payment, promise to pay or authorization of the payment of any money, orany offer, gift, promise to give, or authorization of the giving of anything of value, directly orindirectly, to any government official, political party, party official, or candidate for public orpolitical office to induce such persons to use their influence with a government or instrumentalityin order to obtain an improper business advantage for Consultant or the Company. Consultant willnot retain any sub-agent or representative in connection with the performance of the Serviceswithout the prior written consent of the Company.**6.3****Equitable Remedies**. Consultant acknowledges that irreparable injury will result to theCompany from violation of any of the terms of this Agreement, specifically those identified underSections 4, 5 and 6. Therefore, Consultant expressly agrees that the Company shall beentitled, in addition to damages and any other remedies provided by law, to an injunction (withoutnotice and without the necessity of posting a bond) or other equitable remedy respecting suchviolation or continued violation.**Section 7: Consultant’s Representations.****7.1****No Conflicts**. Consultant represents and warrants that performance of this Agreementdoes not and will not breach any other agreement to which Consultant is a party. Consultantfurther represents and warrants that Consultant has not entered into, and agrees not to enter into,any agreement, either oral or written, in conflict with or in violation of this Agreement.**7.2****Binding Obligation**. Upon its execution and delivery, this Agreement shall constitutethe valid and binding obligation of Consultant, enforceable against Consultant in accordance withits terms, except that such enforcement may be subject to bankruptcy, insolvency, reorganization,moratorium or other similar laws now or hereafter in effect relating to creditors’ rights andgeneral principles of equity.
 
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**Section 8: Company’s Representations****8.1****Authority****.**Company represents that it has the full power and authority to enter intoand perform this Agreement and that the Company has authorized the execution, delivery, andperformance of this Agreement.**8.2****Binding Obligation**. Upon its execution and delivery, this Agreement shall constitutethe valid and binding obligation of the Company, enforceable against the Company in accordance withits terms, except that such enforcement may be subject to bankruptcy, insolvency, reorganization,moratorium or other similar laws now or hereafter in effect relating to creditors’ rights andgeneral principles of equity.**Section 9: Indemnification****9.1****Indemnification**. Consultant shall indemnify the Company and the Affiliates and theirrespective directors, officers, managers, employees, general and limited partners, stockholders,agents, affiliates, attorneys, successors and assigns (collectively, the “Indemnified Parties”)from and against any and all third party claims, losses, damages, liabilities and costs (includinglegal and other professional fees and expenses), joint or several, to which such IndemnifiedParties may become subject relating to or arising out of Consultant’s actual breach of hisobligations under this Agreement. Consultant shall reimburse the Indemnified Parties for allexpenses (including legal and other professional fees and expenses) incurred in connection with theinvestigation, preparation or defense of any pending or threatened claim or any action orproceeding arising therefrom, whether or not any of the Indemnified Parties is a party to suchclaim or action.**Section 10: Miscellaneous****10.1**. **Assignment****.**This Agreement and the Services to be provided hereunder may not beassigned or otherwise transferred by Consultant, or by operation of law, without the prior writtenconsent of the Company. The Company may assign or transfer this Agreement to any Affiliate,without the consent of Consultant. The Company’s assignment of this Agreement to any Affiliateshall in no way affect Consultant’s obligations under this Agreement.**10.2****Waiver and Amendments****.**No waiver, amendment or modification of any provision of thisAgreement shall be effective unless consented to by both parties in writing. No failure or delay byeither party in exercising any right, power or remedy under this Agreement shall operate as awaiver of any such right, power or remedy. No waiver of any breach of any covenant or provisioncontained herein shall be deemed a waiver of any preceding or succeeding breach thereof or of anyother covenant or provision. No extension of time for performance of any obligation or act shallbe deemed an extension of the time for performance of any other obligation or act.**10.3****Notices.** Any notice or communication provided for or required by this Agreement to bein writing shall be: (a) hand delivered, (b) sent by certified mail with full postage, or (c) sentbyovernight courier service with proof of delivery. Any notice so sent shall be deemed received uponthe earlier of an actual receipt or three business days after proper posting. The addresses of theparties shall be as indicated below, but the parties may change their notice addresses by givingwritten notice of such change to the other party at its current address in accordance with thisSection.
 
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   If to Consultant: Ricardo Rodriguez Canney  121 N. Post Oak Lane, #905  Houston, Texas 77024   If to Company: Penn Octane Corporation  Rio Vista Energy Partners L.P.  Attn: Chief Consultant Officer  820 Gessner Road, Suite 1285  Houston, Texas 77024     With a copy to:     Kevin W. Finck, Esq.  Two Embarcadero Center, Suite 1670  San Francisco, California 94111**10.4****Professional Fees****.**In the event of the bringing of any action, suit, or arbitrationby a party hereto against another party hereunder by reason of any breach of any of the covenants,agreements, or provisions arising out of this Agreement, the prevailing party shall be entitled torecover all costs and expenses of that action, suit, or arbitration, at trial, in arbitration, oron appeal, and in collection therewith, including but not limited to, reasonable attorneys’ fees,accounting, and other professional fees resulting therefrom.**10.5****Legal and Equitable Remedies****.**Due to the personal and unique nature of Consultant’sservices pursuant to this Agreement, and because Consultant shall become acquainted with and haveaccess to the Company’s proprietary information, the Company shall have the right to enforce thisAgreement and any of its provisions by injunction, specific performance or other equitable relief,without bond, and without prejudice to any other rights and remedies that the Company may otherwisehave to enforce this Agreement.**10.6****Arbitration****.**Any controversy or claim arising out of or relating to this Agreement(other than claims for preliminary injunctive relief or other prejudgment or equitable remedies)shall be settled by binding arbitration in Houston, Texas or Los Angeles, California (at theelection of the party commencing the action) in accordance with the Commercial Rules of theAmerican Arbitration Association then in effect, and judgment upon an award rendered in sucharbitration may be entered in any court having jurisdiction thereof.BOTH PARTIES HAVE READ AND UNDERSTAND THIS SECTION 10.6, WHICH DISCUSSES ARBITRATION. THEPARTIES UNDERSTAND THAT BY SIGNING THIS AGREEMENT, THEY AGREE TO SUBMIT ANY FUTURE CLAIMS ARISINGOUT OF RELATING TO, OR IN CONNECTION WITH THIS AGREEMENT, OR THEINTERPRETATION, VALIDITY, CONSTRUCTION, PERFORMANCE, BREACH, OR TERMINATION THEREOF TO BINDINGARBITRATION, AND THAT THIS ARBITRATION CLAUSE CONSTITUTES A WAIVER OF EACH PARTIES’ RIGHT TO A JURYTRIAL AND RELATES TO THE RESOLUTION OF ALL DISPUTES RELATING TO ALL ASPECTS OF THE RELATIONSHIPBETWEEN CONSULTANT AND THE COMPANY.
 
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**10.7****Severability****.**Should any one or more of the provisions of this Agreement bedetermined to be illegal or unenforceable, all other provisions of the Agreement shall be giveneffect separately from those provisions of this Agreement so determined and the other provisionsshall not be affected by the illegality or unenforceability.**10.8****Representation by Counsel; Interpretation****.**Each party to this Agreement acknowledgesthat such party has caused this Agreement to be reviewed and/or had the opportunity to have itapproved by legal counsel of such party’s own choice. Consultant acknowledges and agrees that theLaw Offices of Kevin Finck has represented the Company, not Consultant, in connection with thepreparation and execution of this Agreement and that the Law Offices of Kevin Finck may continue torepresent the Company in matters related to this Agreement and otherwise. Consultant has beenadvised to obtain independent legal counsel in such connection. The parties have negotiated theprovisions of this Agreement, and any presumption that an ambiguity contained in this Agreementshall be construed against the party that caused this Agreement to be drafted shall not apply tothe interpretation of this Agreement. The Company agrees to pay Consultant $3,500.00 to assist inthe payment of any personal attorney’s fees used by Consultant in the negotiations surrounding, andleading up to, the execution of this Agreement.**10.9****Governing Law and Venue****.**This Agreement has been entered into in the State of Texasand shall be governed by, interpreted under, and construed and enforced in accordance with theinternal laws of Texas. All claims, arbitrations and lawsuits in connection with this Agreementmust be brought in Harris County, Texas or Los Angeles County, California. Consultant and Companyhereby agree to this jurisdiction and venue.
 
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**10.10****Entire Agreement; Acknowledgment****.**This Agreement constitutes the entire agreementbetween the parties hereto with respect to the subject matter hereof and supersedes any and allprior agreements, understandings, discussions, and/or commitments of any kind with respect to thesubject matter hereof or the potential hiring of Consultant to act as the Chief Consultant Officerof either Penn Octane or Rio Vista. This Agreement may not be amended or supplemented, nor may anyright hereunder be waived, except in writing signed by each of the parties.**10.11****Severability****.**If any provision of this Agreement is declared void, or otherwiseunenforceable, such provision shall be deemed to be severed from this Agreement, which shallotherwise remain in full force and effect.**10.12****Survival**. The provisions of Sections 1.3, 2, 3, 4, 5, 6, 9, and 10 shallsurvive any termination of employment or expiration of this Agreement.**10.13****Further Assurances****.**The parties shall, from time to time, promptly execute anddeliver such further instruments, documents and papers and perform such further acts as may benecessary or proper to carry out and effect the terms of this Agreement.**10.14****Counterparts****.**This agreement may be executed in one or more counterparts, each ofwhich shall be deemed an original and all of which together shall constitute one and the sameinstrument. Facsimile signatures shall have the same legal effect as original signatures.**IN WITNESS WHEREOF**, the parties have executed this Consulting Agreement as of the date firstwritten above.           “The Company”   “Consultant”             **PENN OCTANE CORPORATION**                   By: /s/ Ian T. Bothwell   By: /s/ Ricardo R. Canney     Ian T. Bothwell,      Ricardo Rodriguez Canney    Acting Chief Executive Officer                   **RIO VISTA ENERGY PARTNERS L.P.**                   By: Rio Vista GP LLC, General Partner                   By: /s/ Ian T. Bothwell           Ian T. Bothwell,          Acting Chief Executive Officer        
 
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