Document:

FIRST AMENDED AND RESTATED

                        AGREEMENT OF LIMITED PARTNERSHIP

                                       OF

                      RIO VISTA OPERATING PARTNERSHIP L.P.

<PAGE>
                                TABLE OF CONTENTS

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ARTICLE I     DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . .1
     Section 1.1     Definitions. . . . . . . . . . . . . . . . . . . . . . . .1
     Section 1.2     Construction . . . . . . . . . . . . . . . . . . . . . . .9

ARTICLE II     ORGANIZATION . . . . . . . . . . . . . . . . . . . . . . . . . 10
     Section 2.1     Formation. . . . . . . . . . . . . . . . . . . . . . . . 10
     Section 2.2     Name . . . . . . . . . . . . . . . . . . . . . . . . . . 10
     Section 2.3     Registered Office; Registered Agent; Principal Office;
                     Other Offices. . . . . . . . . . . . . . . . . . . . . . 10
     Section 2.4     Purpose and Business . . . . . . . . . . . . . . . . . . 10
     Section 2.5     Powers . . . . . . . . . . . . . . . . . . . . . . . . . 11
     Section 2.6     Power of Attorney. . . . . . . . . . . . . . . . . . . . 11
     Section 2.7     Term . . . . . . . . . . . . . . . . . . . . . . . . . . 12
     Section 2.8     Title to Partnership Assets. . . . . . . . . . . . . . . 12

ARTICLE III     RIGHTS OF LIMITED PARTNERS. . . . . . . . . . . . . . . . . . 13
     Section 3.1     Limitation of Liability. . . . . . . . . . . . . . . . . 13
     Section 3.2     Management of Business . . . . . . . . . . . . . . . . . 13
     Section 3.3     Outside Activities of the Limited Partners . . . . . . . 13
     Section 3.4     Rights of Limited Partners . . . . . . . . . . . . . . . 13

ARTICLE IV     TRANSFERS OF PARTNERSHIP INTERESTS . . . . . . . . . . . . . . 14
     Section 4.1     Transfer Generally . . . . . . . . . . . . . . . . . . . 14
     Section 4.2     Transfer of General Partner's General Partner
                     Interest . . . . . . . . . . . . . . . . . . . . . . . . 15
     Section 4.3     Transfer of a Limited Partner's Partnership Interest . . 15
     Section 4.4     Restrictions on Transfers. . . . . . . . . . . . . . . . 15

ARTICLE V     CAPITAL CONTRIBUTIONS AND ISSUANCE OF PARTNERSHIP INTERESTS . . 16
     Section 5.1     Initial Contributions. . . . . . . . . . . . . . . . . . 16
     Section 5.2     Contributions Pursuant to the Contribution Agreement . . 16
     Section 5.3     Additional Capital Contributions . . . . . . . . . . . . 16
     Section 5.4     Interest and Withdrawal. . . . . . . . . . . . . . . . . 16
     Section 5.5     Capital Accounts . . . . . . . . . . . . . . . . . . . . 17

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                                TABLE OF CONTENTS
                                  (continued)

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     Section 5.6     Loans from Partners. . . . . . . . . . . . . . . . . . . 19
     Section 5.7     Issuances of Additional Partnership Securities . . . . . 19
     Section 5.8     Limited Preemptive Rights. . . . . . . . . . . . . . . . 20
     Section 5.9     Fully Paid and Non-Assessable Nature of Limited
                     Partner Interests. . . . . . . . . . . . . . . . . . . . 20

ARTICLE VI     ALLOCATIONS AND DISTRIBUTIONS. . . . . . . . . . . . . . . . . 21
     Section 6.1     Allocations for Capital Account Purposes . . . . . . . . 21
     Section 6.2     Allocations for Tax Purposes . . . . . . . . . . . . . . 24
     Section 6.3     Distributions. . . . . . . . . . . . . . . . . . . . . . 26

ARTICLE VII     MANAGEMENT AND OPERATION OF BUSINESS. . . . . . . . . . . . . 27
     Section 7.1     Management . . . . . . . . . . . . . . . . . . . . . . . 27
     Section 7.2     Certificate of Limited Partnership . . . . . . . . . . . 29
     Section 7.3     Restrictions on the General Partner's Authority. . . . . 29
     Section 7.4     Reimbursement of the General Partner . . . . . . . . . . 30
     Section 7.5     Outside Activities . . . . . . . . . . . . . . . . . . . 30
     Section 7.6     Loans from the General Partner; Loans or
                     Contributions from the Partnership; Contracts
                     with Affiliates; Certain Restrictions on the General
                     Partner. . . . . . . . . . . . . . . . . . . . . . . . . 31
     Section 7.7     Indemnification. . . . . . . . . . . . . . . . . . . . . 33
     Section 7.8     Liability of Indemnitees . . . . . . . . . . . . . . . . 35
     Section 7.9     Resolution of Conflicts of Interest. . . . . . . . . . . 35
     Section 7.10    Other Matters Concerning the General Partner . . . . . . 37
     Section 7.11    Reliance by Third Parties. . . . . . . . . . . . . . . . 37

ARTICLE VIII     BOOKS, RECORDS AND ACCOUNTING. . . . . . . . . . . . . . . . 38
     Section 8.1     Records and Accounting . . . . . . . . . . . . . . . . . 38
     Section 8.2     Fiscal Year. . . . . . . . . . . . . . . . . . . . . . . 38

ARTICLE IX     TAX MATTERS. . . . . . . . . . . . . . . . . . . . . . . . . . 38
     Section 9.1     Tax Returns and Information. . . . . . . . . . . . . . . 38
     Section 9.2     Tax Elections. . . . . . . . . . . . . . . . . . . . . . 39
     Section 9.3     Tax Controversies. . . . . . . . . . . . . . . . . . . . 39
     Section 9.4     Withholding. . . . . . . . . . . . . . . . . . . . . . . 39

ARTICLE X     ADMISSION OF PARTNERS . . . . . . . . . . . . . . . . . . . . . 39

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                                TABLE OF CONTENTS
                                  (continued)

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     Section 10.1    Admission of Partners. . . . . . . . . . . . . . . . . . 39
     Section 10.2    Admission of Substituted Limited Partner . . . . . . . . 40
     Section 10.3    Admission of Additional Limited Partners . . . . . . . . 40
     Section 10.4    Admission of Successor or Transferee General Partner . . 40
     Section 10.5    Amendment of Agreement and Certificate of Limited
                     Partnership. . . . . . . . . . . . . . . . . . . . . . . 41

ARTICLE XI     WITHDRAWAL OR REMOVAL OF PARTNERS. . . . . . . . . . . . . . . 41
     Section 11.1    Withdrawal of the General Partner. . . . . . . . . . . . 41
     Section 11.2    Removal of the General Partner . . . . . . . . . . . . . 42
     Section 11.3    Interest of Departing Partner. . . . . . . . . . . . . . 43
     Section 11.4    Withdrawal of a Limited Partner. . . . . . . . . . . . . 43

ARTICLE XII     DISSOLUTION AND LIQUIDATION . . . . . . . . . . . . . . . . . 43
     Section 12.1    Dissolution. . . . . . . . . . . . . . . . . . . . . . . 43
     Section 12.2    Continuation of the Business of the Partnership After
                     Dissolution. . . . . . . . . . . . . . . . . . . . . . . 44
     Section 12.3    Liquidator . . . . . . . . . . . . . . . . . . . . . . . 45
     Section 12.4    Liquidation. . . . . . . . . . . . . . . . . . . . . . . 45
     Section 12.5    Cancellation of Certificate of Limited Partnership . . . 46
     Section 12.6    Return of Contributions. . . . . . . . . . . . . . . . . 46
     Section 12.7    Waiver of Partition. . . . . . . . . . . . . . . . . . . 46
     Section 12.8    Capital Account Restoration. . . . . . . . . . . . . . . 46

ARTICLE XIII     AMENDMENT OF PARTNERSHIP AGREEMENT . . . . . . . . . . . . . 47
     Section 13.1    Amendment to be Adopted Solely by the General
                     Partner. . . . . . . . . . . . . . . . . . . . . . . . . 47
     Section 13.2    Amendment Procedures . . . . . . . . . . . . . . . . . . 48

ARTICLE XIV     MERGER. . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
     Section 14.1    Authority. . . . . . . . . . . . . . . . . . . . . . . . 48
     Section 14.2    Procedure for Merger or Consolidation. . . . . . . . . . 48
     Section 14.3    Approval by Limited Partners of Merger or
                     Consolidation. . . . . . . . . . . . . . . . . . . . . . 49
     Section 14.4    Certificate of Merger. . . . . . . . . . . . . . . . . . 50
     Section 14.5    Effect of Merger . . . . . . . . . . . . . . . . . . . . 50

ARTICLE XV     GENERAL PROVISIONS . . . . . . . . . . . . . . . . . . . . . . 51
     Section 15.1    Addresses and Notices. . . . . . . . . . . . . . . . . . 51

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                                TABLE OF CONTENTS
                                  (continued)

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     Section 15.2    Further Action . . . . . . . . . . . . . . . . . . . . . 51
     Section 15.3    Binding Effect . . . . . . . . . . . . . . . . . . . . . 51
     Section 15.4    Integration. . . . . . . . . . . . . . . . . . . . . . . 51
     Section 15.5    Creditors. . . . . . . . . . . . . . . . . . . . . . . . 51
     Section 15.6    Waiver . . . . . . . . . . . . . . . . . . . . . . . . . 51
     Section 15.7    Counterparts . . . . . . . . . . . . . . . . . . . . . . 51
     Section 15.8    Applicable Law . . . . . . . . . . . . . . . . . . . . . 52
     Section 15.9    Invalidity of Provisions . . . . . . . . . . . . . . . . 52
     Section 15.10   Consent of Partners. . . . . . . . . . . . . . . . . . . 52

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<PAGE>
                           FIRST AMENDED AND RESTATED
                        AGREEMENT OF LIMITED PARTNERSHIP
                                       OF
                      RIO VISTA OPERATING PARTNERSHIP L.P.

     This  FIRST  AMENDED  AND  RESTATED AGREEMENT OF LIMITED PARTNERSHIP of RIO
VISTA  OPERATING  PARTNERSHIP  L.P.,  dated  as  of  September  16,  2004  (this
"Agreement"),  is  entered  into  by  and  between Rio Vista Operating GP LLC, a
 ---------
Delaware  limited  liability  company,  as  the  General  Partner,  Penn  Octane
Corporation,  a Delaware corporation, and, upon consummation of the transactions
contemplated  under  Section  5.2  of  this Agreement, Rio Vista Energy Partners
                     ------------
L.P., a Delaware limited partnership, as the Limited Partners, together with any
other Persons who hereafter become Partners in the Partnership or parties hereto
as provided herein.  This Agreement amends and restates the Agreement of Limited
Partnership  of  the  Partnership  dated  July,  10,  2003,  in  its  entirety.

                                    ARTICLE I

                                   DEFINITIONS

     Section  1.1     Definitions.  The  following  definitions shall be for all
                      -----------
purposes,  unless  otherwise  clearly  indicated to the contrary, applied to the
terms  used  in  this Agreement. Capitalized terms used herein but not otherwise
defined  shall  have  the  meanings assigned to such terms in the MLP Agreement.

     "Additional  Limited Partner" means a Person admitted to the Partnership as
      ---------------------------
a  Limited  Partner  pursuant to Section 10.3 and who is s such on the books and
                                  -----------
records  of  the  Partnership.

     "Adjusted  Capital  Account"  means the Capital Account maintained for each
      --------------------------
Partner  as  of the end of each fiscal year of the Partnership, (a) increased by
any amounts that such Partner is obligated to restore under the standards set by
Treasury  Regulation  Section  1.704-1(b)(2)(ii)(c)  (or  is deemed obligated to
restore under Treasury Regulation Sections 1.704-2(g) and 1.704-2(i)(5)) and (b)
decreased  by (i) the amount of all losses and deductions that, as of the end of
such  fiscal  year,  are  reasonably expected to be allocated to such Partner in
subsequent  years  under  Sections 704(e)(2) and 706(d) of the Code and Treasury
Regulation  Section  1.751-1(b)(2)(ii), and (ii) the amount of all distributions
that,  as  of the end of such fiscal year, are reasonably expected to be made to
such  Partner in subsequent years in accordance with the terms of this Agreement
or  otherwise  to  the extent they exceed offsetting increases to such Partner's
Capital  Account  that are reasonably expected to occur during (or prior to) the
year  in which such distributions are reasonably expected to be made (other than
increases as a result of a minimum gain chargeback pursuant to Section 6.1(d)(i)
                                                               -----------------
or 6.1(d)(ii)). The foregoing definition of Adjusted Capital Account is intended
-------------
to  comply  with  the  provisions  of  Treasury  Regulation  Section
1.704-1(b)(2)(ii)(d)  and  shall  be  interpreted  consistently  therewith.  The
"Adjusted Capital Account" of a Partner in respect of a General Partner Interest
or any other specified interest in the Partnership shall be the amount that such
Adjusted  Capital  Account  would  be  if such General Partner Interest or other
interest  in  the  Partnership were the only interest in the Partnership held by
such  Partner

                                        1
<PAGE>
from and after the date on which such General Partner Interest or other interest
in  the  Partnership  was  first  issued.

     "Adjusted Property" means any property the Carrying Value of which has been
      -----------------
adjusted  pursuant  to  Section  5.5(d)(i)  or  5.5(d)(ii).
                        ----------------------------------

     "Affiliate"  means,  with  respect  to  any  Person,  any other Person that
      ---------
directly  or  indirectly  through  one  or  more  intermediaries  controls,  is
controlled  by  or is under common control with, the Person in question. As used
herein,  the  term  "control"  means  the possession, direct or indirect, of the
power  to  direct  or  cause  the  direction of the management and policies of a
Person,  whether  through  ownership  of  voting  securities,  by  contract  or
otherwise.

     "Agreed Allocation" means any allocation, other than a Required Allocation,
      -----------------
of  an  item  of  income,  gain, loss or deduction pursuant to the provisions of
Section  6.1,  including,  without  limitation,  a  Curative  Allocation  (if
------------
appropriate  to  the  context  in  which  the term "Agreed Allocation" is used).

     "Agreed  Value"  of any Contributed Property means the fair market value of
      -------------
such  property  or other consideration at the time of contribution as determined
by  the  General  Partner  using  such  reasonable method of valuation as it may
adopt. The General Partner shall, in its discretion, use such method as it deems
reasonable and appropriate to allocate the aggregate Agreed Value of Contributed
Properties  contributed to the Partnership in a single or integrated transaction
among each separate property on a basis proportional to the fair market value of
each  Contributed  Property.

     "Agreement"  means  this  Agreement  of  Limited  Partnership  of Rio Vista
      ---------
Operating  Partnership  L.P.,  as  it may be amended, supplemented restated from
time  to  time.

     "Assets" means all assets conveyed, contributed or otherwise transferred to
      ------
the  Partnership  Group  pursuant  to  the  Contribution  Agreement.

     "Assignee"  means  a  Person  to whom one or more Limited Partner Interests
      --------
have  been  transferred  in a manner permitted under this Agreement, but who has
not  been  admitted  as  a  Substituted  Limited.

     "Associate"  means,  when  used to indicate a relationship with any Person,
      ---------
(a)  any corporation or organization of which such Person is a director, officer
or  partner or is, directly or indirectly, the owner of 20% or more of any class
of voting stock or other voting interest; (b) any trust or other estate in which
such  Person  has  at least a 20% beneficial interest or as to which such Person
serves  as  trustee  or in a similar fiduciary capacity; and (c) any relative or
spouse  of  such  Person,  or  any  relative  of  such  spouse, who has the same
principal  residence  as  such  Person.

     "Available  Cash"  means,  with  respect to any Quarter ending prior to the
      ---------------
Liquidation  Date:

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<PAGE>
          (a)     the  sum  of  (i)  all  cash  and  cash  equivalents  of  the
Partnership on hand at the end of such Quarter, and (ii) all additional cash and
cash  equivalents  of  the  Partnership  on hand on the date of determination of
Available  Cash  with  respect  to  such  Quarter resulting from Working Capital
Borrowings  made  subsequent  to  the  end  of  such  Quarter,  less

          (b)     the  amount  of  any  cash  reserves  that  is  necessary  or
appropriate  in  the reasonable discretion of the General Partner to (i) provide
for  the  proper  conduct of the business of the Partnership (including reserves
for  future  capital expenditures and for anticipated future credit needs of the
Partnership)  subsequent to such Quarter, (ii) comply with applicable law or any
loan agreement, security agreement, mortgage, debt instrument or other agreement
or  obligation  to  which any Group Member is a party or by which it is bound or
its  assets  are  subject or (iii) provide funds for distributions under Section
6.4  or  6.5 of the MLP Agreement in respect of any one or more of the next four
Quarters;  provided,  however,  that  the General Partner may not establish cash
reserves  pursuant  to  (iii) above if the effect of such reserves would be that
the MLP is unable to distribute the Minimum Quarterly Distribution on all Common
Units,  plus  any  Cumulative  Common  Unit  Arrearage on all Common Units, with
respect  to  such  Quarter;  and, provided further, that disbursements made by a
Group Member or cash reserves established, increased or reduced after the end of
such  Quarter  but on or before the date of determination of Available Cash with
respect  to  such  Quarter  shall  be  deemed  to  have  been made, established,
increased  or  reduced,  for purposes of determining Available Cash, within such
Quarter  if  the  General  Partner  so  determines.

     Notwithstanding the foregoing, "Available Cash" with respect to the Quarter
in  which  the  Liquidation  Date  occurs and any subsequent Quarter shall equal
zero.

     "Book-Tax Disparity" means with respect to any item of Contributed Property
      ------------------
or  Adjusted  Property,  as  of  the  date  of any determination, the difference
between the Carrying Value of such Contributed Property or Adjusted Property and
the  adjusted  basis  thereof for federal income tax purposes as of such date. A
Partner's  share  of  the  Partnership's  Book-Tax  Disparities  in  all  of its
Contributed  Property  and Adjusted Property will be reflected by the difference
between such Partner's Capital Account balance as maintained pursuant to Section
                                                                         -------
5.5 and  the  hypothetical balance of such Partner's Capital Account computed as
---
if  it  had  been  maintained  strictly  in  accordance  with federal income tax
accounting  principles.

     "Capital  Account"  means  the  capital  account  maintained  for a Partner
      ----------------
pursuant  to  Section  5.5  . The "Capital Account" of a Partner in respect of a
              ------------
General  Partner  Interest or any other Partnership Interest shall be the amount
that  such  Capital  Account  would be if such General Partner Interest or other
specified  interest in the Partnership were the only interest in the Partnership
held  by  such  Partner  from  and  after the date on which such General Partner
Interest  or  other  specified  interest  in  the  Partnership was first issued.

     "Capital  Contribution"  means any cash, cash equivalents or the Net Agreed
      ---------------------
Value  of  Contributed  Property  that  a Partner contributes to the Partnership
pursuant  to  this  Agreement  or  the  Contribution  Agreement.

                                        3
<PAGE>
     "Carrying  Value"  means  (a)  with  respect to a Contributed Property, the
      ---------------
Agreed  Value of such property reduced (but not below zero) by all depreciation,
amortization  and  cost  recovery  deductions  charged  to  the  Partners'  and
Assignees'  Capital  Accounts  in  respect of such Contributed Property, and (b)
with  respect  to  any  other  Partnership  property, the adjusted basis of such
property  for  federal income tax purposes, all as of the time of determination.
The  Carrying  Value  of  any  property  shall  be adjusted from time to time in
accordance  with  Sections  5.5(d)(i)  and  5.5(d)(ii)  and  to reflect changes,
                  ------------------------------------
additions  or  other  adjustments  to  the  Carrying  Value for dispositions and
acquisitions  of  Partnership  properties,  as deemed appropriate by the General
Partner.

     "Certificate  of  Limited  Partnership"  means  the  Certificate of Limited
      -------------------------------------
Partnership of the Partnership filed with the Secretary of State of the State of
Delaware  as  referenced  in  Section  7.2,  as  such  Certificate  of  Limited
                              ------------
Partnership  may  be  amended,  supplemented  or  restated  from  time  to time.

     "Closing  Date" means the first date on which the Registration Statement is
      -------------
declared  effective  by  the  Commission.

     "Code"  means  the  Internal Revenue Code of 1986, as amended and in effect
      ----
from time to time. Any reference herein to a specific section or sections of the
Code  shall  be  deemed to include a reference to any corresponding provision of
any  successor  law.

     "Commission"  means  the  United States Securities and Exchange Commission.
      ----------

     "Contributed  Property" means each property or other asset, in such form as
      ---------------------
may  be  permitted  by  the Delaware Act, but excluding cash, contributed to the
Partnership.  Once  the  Carrying  Value  of  a Contributed Property is adjusted
pursuant  to  Section  5.5(d),  such  property  shall  no  longer  constitute  a
              ---------------
Contributed  Property,  but  shall  be  deemed  an  Adjusted  Property.

     "Contribution  Agreement"  means  that certain Contribution, Conveyance and
      -----------------------
Assumption  Agreement  among  the Partnership, the MLP General Partner, the MLP,
and  Penn  Octane Corporation, together with the additional conveyance documents
and  instruments  contemplated  or  referenced  thereunder.

     "Curative  Allocation"  means  any  allocation  of an item of income, gain,
      --------------------
deduction,  loss  or  credit  pursuant  to the provisions of Section 6.1(d)(ix).
                                                             ------------------

     "Delaware  Act" means the Delaware Revised Uniform Limited Partnership Act,
      -------------
6 Del. C. Section 17-101 et seq., as amended, supplemented or restated from time
to  time,  and  any  successor  to  such  statute.

     "Departing  Partner"  means  a  former  General  Partner from and after the
      ------------------
effective  date  of  any  withdrawal  or  removal of such former General Partner
pursuant  to  Section  11.1  or  11.2.
              -----------------------

     "Distribution"  means  the  distribution  of Common Units of the MLP to the
      ------------
stockholders  of  Penn  Octane  Corporation,  as  described  in the Registration
Statement.

                                        4
<PAGE>
     "Economic  Risk  of  Loss" has the meaning set forth in Treasury Regulation
      ------------------------
Section  1.752-2(a).

     "Event  of  Withdrawal"  has  the  meaning assigned to such term in Section
      ---------------------                                              -------
11.1(a).
-------

     "General  Partner"  means Rio Vista Operating GP LLC and its successors and
      ----------------
permitted  assigns  as  general  partner  of  the  Partnership.

     "General  Partner  Interest"  means  the  ownership interest of the General
      --------------------------
Partner  in  the Partnership (in its capacity as a general partner) and includes
any  and  all  benefits  to which the General Partner is entitled as provided in
this  Agreement,  together with all obligations of the General Partner to comply
with  the  terms  and  provisions  of  this  Agreement.

     "Group  Member"  means  a  member  of  the  Partnership  Group.
      -------------

     "Indemnitee"  means (a) the General Partner, (b) any Departing Partner, (c)
      ----------
any  Person  who  is or was an Affiliate of the General Partner or any Departing
Partner,  (d)  any  Person  who  is or was a member, partner, officer, director,
employee,  agent  or  trustee  of  any  Group Member, the General Partner or any
Departing  Partner  or any Affiliate of any Group Member, the General Partner or
any  Departing  Partner, and (e) any Person who is or was serving at the request
of  the General Partner or any Departing Partner or any Affiliate of the General
Partner  or  any  Departing  Partner  as an officer, director, employee, member,
partner,  agent, fiduciary or trustee of another Person; provided, that a Person
shall  not be an Indemnitee by reason of providing, on a fee-for-services basis,
trustee,  fiduciary  or  custodial  services.

     "Limited Partner" means any Person that is admitted to the Partnership as a
      ---------------
limited  partner pursuant to the terms and conditions of this Agreement; but the
term "Limited Partner" shall not include any Person from and after the time such
Person  withdraws  as  a  Limited  Partner  from  the  Partnership.

     "Limited  Partner  Interest"  means  the  ownership  interest  of a Limited
      --------------------------
Partner  or  Assignee  in  the  Partnership and includes any and all benefits to
which  such  Limited  Partner  or  Assignee  is  entitled  as  provided  in this
Agreement,  together with all obligations of such Limited Partner or Assignee to
comply  with  the  terms  and  provisions  of  this  Agreement.

     "Liquidation  Date"  means  (a)  in the case of an event giving rise to the
      -----------------
dissolution  of  the Partnership of the type described in clauses (a) and (b) of
the first sentence of Section 12.2, the date on which the applicable time period
                      ------------
during  which  the  Partners  have  the  right  to  elect  to  reconstitute  the
Partnership and continue its business has expired without such an election being
made,  and  (b) in the case of any other event giving rise to the dissolution of
the  Partnership,  the  date  on  which  such  event  occurs.

     "Liquidator"  means  one or more Persons selected by the General Partner to
      ----------
perform  the  functions  described in Section 12.3 as liquidating trustee of the
                                      ------------
Partnership  within  the  meaning  of  the  Delaware  Act.

     "Merger  Agreement"  has the meaning assigned to such term in Section 14.1.
      -----------------                                            ------------

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<PAGE>
     "MLP" means Rio Vista Energy Partners L.P., a Delaware limited partnership.
      ---

     "MLP  Agreement"  means  the  Agreement of Limited Partnership of Rio Vista
      --------------
Energy  Partners  L.P., as it may be amended, supplemented or restated from time
to  time.

     "MLP  General Partner" means Rio Vista GP LLC, a Delaware limited liability
      --------------------
company  and  the  general  partner  of  the  MLP.

     "Net  Agreed Value" means, (a) in the case of any Contributed Property, the
      -----------------
Agreed  Value  of such property reduced by any liabilities either assumed by the
Partnership  upon  such  contribution  or to which such property is subject when
contributed,  and  (b)  in  the case of any property distributed to a Partner or
Assignee  by  the Partnership, the Partnership's Carrying Value of such property
(as  adjusted  pursuant  to  Section  5.5(d)(ii))  at  the time such property is
                             -------------------
distributed,  reduced  by  any  indebtedness  either  assumed by such Partner or
Assignee upon such distribution or to which such property is subject at the time
of  distribution,  in  either case, as determined under Section 752 of the Code.

     "Net  Income"  means,  for  any  taxable  year,  the excess, if any, of the
      -----------
Partnership's  items  of  income  and  gain  (other  than those items taken into
account  in the computation of Net Termination Gain or Net Termination Loss) for
such taxable year over the Partnership's items of loss and deduction (other than
those items taken into account in the computation of Net Termination Gain or Net
Termination  Loss)  for such taxable year. The items included in the calculation
of  Net  Income  shall be determined in accordance with Section 5.5(b) and shall
                                                        --------------
not  include  any  items  specially  allocated  under  Section  6.1(d).
                                                       ---------------

     "Net  Loss"  means,  for  any  taxable  year,  the  excess,  if any, of the
      ---------
Partnership's  items  of  loss  and deduction (other than those items taken into
account  in the computation of Net Termination Gain or Net Termination Loss) for
such  taxable  year  over the Partnership's items of income and gain (other than
those items taken into account in the computation of Net Termination Gain or Net
Termination  Loss)  for  such  taxable  year.

The  items  included  in  the  calculation  of  Net  Loss shall be determined in
accordance  with  Section  5.5(b)  and  shall  not  include  any items specially
                  ---------------
allocated  under  Section  6.1(d).
                  ---------------

     "Net  Termination  Gain" means, for any taxable year, the sum, if positive,
      ----------------------
of  all  items  of income, gain, loss or deduction recognized by the Partnership
after  the  Liquidation  Date.  The  items  included in the determination of Net
Termination Gain shall be determined in accordance with Section 5.5(b) and shall
                                                        --------------
not  include any items of income, gain or loss specially allocated under Section
                                                                         -------
6.1(d).
------

     "Net  Termination  Loss" means, for any taxable year, the sum, if negative,
      ----------------------
of  all  items  of income, gain, loss or deduction recognized by the Partnership
after  the  Liquidation  Date.  The  items  included in the determination of Net
Termination Loss shall be determined in accordance with Section 5.5(b) and shall
                                                        --------------
not  include any items of income, gain or loss specially allocated under Section
                                                                         -------
6.1(d).
------

                                        6
<PAGE>
     "Nonrecourse  Built-in  Gain"  means  with  respect  to  any  Contributed
      ---------------------------
Properties  or  Adjusted  Properties  that  are  subject to a mortgage or pledge
securing  a  Nonrecourse Liability, the amount of any taxable gain that would be
allocated  to  the Partners pursuant to Sections 6.2(b)(i)(A), 6.2(b)(ii)(A) and
                                        ----------------------------------------
6.2(b)(iii) if such properties were disposed of in a taxable transaction in full
-----------
satisfaction  of  such  liabilities  and  for  no  other  consideration.

     "Nonrecourse  Deductions"  means  any  and  all items of loss, deduction or
      -----------------------
expenditure (including, without limitation, any expenditure described in Section
705(a)(2)(B)  of  the  Code) that, in accordance with the principles of Treasury
Regulation  Section  1.704-2(b),  are  attributable  to a Nonrecourse Liability.

     "Nonrecourse  Liability"  has  the meaning set forth in Treasury Regulation
      ----------------------
Section  1.752-1(a)(2).

     "OLP  Subsidiary"  means  a  Subsidiary  of  the  Partnership.
      ---------------

     "Omnibus  Agreement"  means that Omnibus Agreement, dated as of the Closing
      ------------------
Date,  among  the  Partnership, Penn Octane Corporation, the MLP General Partner
and  the  MLP.

     "Opinion of Counsel" means a written opinion of counsel (who may be regular
      ------------------
counsel  to  the  Partnership  or  the General Partner or any of its Affiliates)
acceptable  to  the  General  Partner  in  its  reasonable  discretion.

     "Partner Nonrecourse Debt" has the meaning set forth in Treasury Regulation
      ------------------------
Section  1.704-2(b)(4).

     "Partner  Nonrecourse  Debt  Minimum  Gain"  has  the  meaning set forth in
      -----------------------------------------
Treasury  Regulation  Section  1.704-2(i)(2).

     "Partner Nonrecourse Deductions" means any and all items of loss, deduction
      ------------------------------
or  expenditure  (including,  without  limitation,  any expenditure described in
Section  705(a)(2)(B)  of  the  Code) that, in accordance with the principles of
Treasury  Regulation  Section  1.704-2(i),  are  attributable  to  a  Partner
Nonrecourse  Debt.

     "Partners"  means  the  General  Partner  and  the  Limited  Partners.
      --------

     "Partnership"  means  Rio  Vista  Operating  Partnership  L.P.,  a Delaware
      -----------
limited  partnership,  and  any  successors  thereto.

     "Partnership Group" means the Partnership and all OLP Subsidiaries, treated
      -----------------
as  a  single  consolidated  entity.

     "Partnership  Interest"  means  an  ownership  interest of a Partner in the
      ---------------------
Partnership,  which  shall  include the General Partner Interest and the Limited
Partner  Interest(s).

     "Partnership  Minimum Gain" means that amount determined in accordance with
      -------------------------
the  principles  of  Treasury  Regulation  Section  1.704-2(d).

                                        7
<PAGE>
     "Partnership  Security" means any class or series of equity interest in the
      ---------------------
Partnership (but excluding any options, rights, warrants and appreciation rights
relating  to  an  equity  interest  in  the  Partnership).

     "Percentage  Interest"  means  the  percentage  interest in the Partnership
      --------------------
owned  by  each  Partner  upon completion of the transactions in Section 5.2 and
                                                                 -----------
shall  mean, (a) as to the General Partner, 0.10% and (b) as to the MLP, 99.90%.

     "Person"  means  an individual or a corporation, limited liability company,
      ------
partnership,  joint  venture,  trust,  unincorporated organization, association,
government  agency  or  political  subdivision  thereof  or  other  entity.

     "Quarter"  means,  unless  the context requires otherwise, a fiscal quarter
      -------
(or,  with  respect  to the fiscal quarter during which the Closing Date occurs,
the  portion  of  such  fiscal  quarter remaining after the Closing Date) of the
Partnership.

     "Recapture  Income"  means any gain recognized by the Partnership (computed
      -----------------
without  regard  to any adjustment required by Section 734 or Section 743 of the
Code)  upon  the  disposition of any property or asset of the Partnership, which
gain  is characterized as ordinary income because it represents the recapture of
deductions  previously  taken  with  respect  to  such  property  or  asset.

     "Registration  Statement" means the Registration Statement on Form 10 (File
      -----------------------
No.  0-50394 as it has been or as it may be amended or supplemented from time to
time,  filed by the MLP with the Commission under the Securities Act to register
the  distribution  of  the  Common  Units  in  the  Distribution.

     "Required  Allocations"  means (a) any limitation imposed on any allocation
      ---------------------
of  Net  Losses or Net Termination Losses under Section 6.1(b) or 6.1(c)(ii) and
                                                --------------------------------
(b)  any  allocation  of  an item of income, gain, loss or deduction pursuant to
---
Section  6.1(d)(i),  6.1(d)(ii),  6.1(d)(iv),  6.1(d)(vii)  or  6.1(d)(ix).
--------------------------------------------------------------------------

     "Residual  Gain"  or "Residual Loss" means any item of gain or loss, as the
      --------------       -------------
case  may  be,  of  the  Partnership  recognized for federal income tax purposes
resulting  from  a sale, exchange or other disposition of a Contributed Property
or  an  Adjusted  Property,  to  the  extent  such  item  of gain or loss is not
allocated  pursuant  to  Section 6.2(b)(i)(A) or 6.2(b)(ii)(A), respectively, to
                         -------------------------------------
eliminate  Book-Tax  Disparities.

     "Securities Act" means the Securities Act of 1933, as amended, supplemented
      --------------
or  restated  from  time  to  time  and  any  successor  to  such  statute.

     "Subsidiary"  means, with respect to any Person, (a) a corporation of which
      ----------
more  than  50%  of  the  voting power of shares entitled (without regard to the
occurrence  of  any  contingency)  to vote in the election of directors or other
governing body of such corporation is owned, directly or indirectly, at the date
of  determination, by such Person, by one or more Subsidiaries of such Person or
a  combination  thereof, (b) a partnership (whether general or limited) in which
such  Person  or a Subsidiary of such Person is, at the date of determination, a
general or limited partner

                                        8
<PAGE>
of  such  partnership, but only if more than 50% of the partnership interests of
such  partnership  (considering  all  of  the  partnership  interests  of  the
partnership  as a single class) is owned, directly or indirectly, at the date of
determination,  by such Person, by one or more Subsidiaries of such Person, or a
combination  thereof,  or  (c)  any  other Person (other than a corporation or a
partnership) in which such Person, one or more Subsidiaries of such Person, or a
combination  thereof,  directly or indirectly, at the date of determination, has
(i)  at least a majority ownership interest or (ii) the power to elect or direct
the  election  of  a  majority  of the directors or other governing body of such
Person.

     "Substituted  Limited  Partner" means a Person who is admitted as a Limited
      -----------------------------
Partner to the Partnership pursuant to Section 10.2 in place of and with all the
                                       ------------
rights  of  a Limited Partner and who is shown as a Limited Partner on the books
and  records  of  the  Partnership.

     "Surviving  Business  Entity"  has  the  meaning  assigned  to such term in
      ---------------------------
Section  14.2(b).
----------------

     "transfer"  has  the  meaning  assigned  to  such  term  in Section 4.1(a).
      --------                                                   --------------

     "Unrealized  Gain"  attributable to any item of Partnership property means,
      ----------------
as  of  any  date  of  determination, the excess, if any, of (a) the fair market
value of such property as of such date (as determined under Section 5.5(d)) over
                                                            --------------
(b) the Carrying Value of such property as of such date (prior to any adjustment
to  be  made  pursuant  to  Section  5.5(d)  as  of  such  date).
                            ---------------

     "Unrealized  Loss"  attributable to any item of Partnership property means,
      ----------------
as  of  any date of determination, the excess, if any, of (a) the Carrying Value
of such property as of such date (prior to any adjustment to be made pursuant to
Section  5.5(d) as of such date) over (b) the fair market value of such property
---------------
as  of  such  date  (as  determined  under  Section  5.5(d)).
                                            ---------------

     "U.S.  GAAP"  means  United States Generally Accepted Accounting Principles
      ----------
consistently  applied.

     "Withdrawal  Opinion  of  Counsel" has the meaning assigned to such term in
      --------------------------------
Section  11.1(b).
----------------

     "Working  Capital  Borrowings"  means  borrowings  used  solely for working
      ----------------------------
capital  purposes  or to pay distributions to Partners made pursuant to a credit
facility  or  other arrangement to the extent such borrowings are required to be
reduced  to  a  relatively  small amount each year (or for the year in which the
Distribution  is consummated, the 12-month period beginning on the Closing Date)
for  an  economically  meaningful  period  of  time.

     Section  1.2     Construction.  Unless  the context requires otherwise: (a)
                      ------------
any  pronoun  used  in this Agreement shall include the corresponding masculine,
feminine  or  neuter  forms,  and the singular form of nouns, pronouns and verbs
shall include the plural and vice versa; (b) references to Articles and Sections
refer  to Articles and Sections of this Agreement; and (c) the term "include" or
"includes"  means includes, without limitation, and "including" means including,
without  limitation.

                                        9
<PAGE>
                                   ARTICLE II

                                  ORGANIZATION

     Section 2.1     Formation.  Except as expressly provided to the contrary in
                     ---------
this Agreement, the rights, duties (including fiduciary duties), liabilities and
obligations  of the Partners and the administration, dissolution and termination
of  the  Partnership  shall  be  governed  by  the Delaware Act. All Partnership
Interests  shall  constitute  personal  property  of  the  owner thereof for all
purposes  and  a  Partner  has  no  interest  in  specific Partnership property.

     Section  2.2     Name.  The  name  of  the  Partnership shall be "Rio Vista
                      ----
Operating  Partnership  L.P."  The Partnership's business may be conducted under
any  other  name or names deemed necessary or appropriate by the General Partner
in  its  sole  discretion,  including the name of the General Partner. The words
"Limited  Partnership,"  "L.P.,"  "Ltd."  or  similar  words or letters shall be
included  in the Partnership's name where necessary for the purpose of complying
with  the  laws of any jurisdiction that so requires. The General Partner in its
discretion  may  change the name of the Partnership at any time and from time to
time  and  shall  notify the Limited Partners of such change in the next regular
communication  to  the  Limited  Partners.

     Section  2.3     Registered  Office;  Registered  Agent;  Principal Office;
                      ----------------------------------------------------------
Other  Offices.  Unless and until changed by the General Partner, the registered
--------------
office of the Partnership in the State of Delaware shall be located at 615 South
DuPont Highway, Dover, DE 19901, and the registered agent for service of process
on  the  Partnership in the State of Delaware at such registered office shall be
Capitol Services, Inc.  The principal office of the Partnership shall be located
at  820  Gessner  Road, Suite 1285, Houston, Texas 77024, or such other place as
the  General  Partner  may  from time to time designate by notice to the Limited
Partners.  The  Partnership  may  maintain offices at such other place or places
within  or  outside the State of Delaware as the General Partner deems necessary
or  appropriate.  The  address of the General Partner shall be 820 Gessner Road,
Suite 1285, Houston, Texas 77024, or such other place as the General Partner may
from  time  to  time  designate  by  notice  to  the  Limited  Partners.

     Section  2.4     Purpose  and  Business.  The  purpose  and  nature  of the
                      ----------------------
business  to  be  conducted  by the Partnership shall be to (a) acquire, manage,
operate  and  sell  the  Assets  and  any  similar  assets  or properties now or
hereafter  acquired by the Partnership, (b) engage directly in, or enter into or
form  any  corporation, partnership, joint venture, limited liability company or
other  arrangement  to  engage  indirectly  in,  any  business activity that the
Partnership  is  permitted  to  engage  in,  or any type of business or activity
engaged  in  by the General Partner prior to the Closing Date and, in connection
therewith,  to  exercise  all  of  the  rights  and  powers  conferred  upon the
Partnership  pursuant  to the agreements relating to such business activity, (c)
engage  directly  in,  or enter into or form any corporation, partnership, joint
venture, limited liability company or other arrangement to engage indirectly in,
any  business activity that is approved by the General Partner and that lawfully
may be conducted by a limited partnership organized pursuant to the Delaware Act
and, in connection therewith, to exercise all of the rights and powers conferred
upon  the  Partnership  pursuant  to  the  agreements  relating to such business
activity;  provided, however, that the General Partner reasonably determines, as
of  the  date  of  the  acquisition  or commencement of such activity, that such
activity  (i) generates "qualifying

                                       10
<PAGE>
income"  (as  such term is defined pursuant to Section 7704 of the Code) or (ii)
enhances  the  operations  of  an  activity  of  the  Partnership that generates
qualifying  income,  and  (d)  do  anything  necessary  or  appropriate  to  the
foregoing,  including  the  making  of capital contributions or loans to a Group
Member,  the  MLP  or  any  Subsidiary  of  the  MLP. The General Partner has no
obligation  or duty to the Partnership, the Limited Partners or the Assignees to
propose or approve, and in its discretion may decline to propose or approve, the
conduct  by  the  Partnership  of  any  business.

     Section  2.5     Powers.  The  Partnership shall be empowered to do any and
                      ------
all  acts and things necessary, appropriate, proper, advisable, incidental to or
convenient  for  the furtherance and accomplishment of the purposes and business
described  in Section 2.4 and for the protection and benefit of the Partnership.
              -----------

     Section  2.6     Power  of  Attorney.
                      -------------------

          (a)     Each  Limited Partner and each Assignee hereby constitutes and
appoints  the  General  Partner  and,  if  a Liquidator shall have been selected
pursuant to Section 12.3, the Liquidator (and any successor to the Liquidator by
            ------------
merger,  transfer,  assignment,  election  or  otherwise)  and  each  of  their
authorized  officers  and attorneys-in-fact, as the case may be, with full power
of  substitution,  as  its true and lawful agent and attorney-in-fact, with full
power  and  authority  in  his  name,  place  and  stead,  to:

               (i)     execute,  swear to, acknowledge, deliver, file and record
in  the  appropriate  public  offices  (A) all certificates, documents and other
instruments (including this Agreement and the Certificate of Limited Partnership
and  all  amendments or restatements hereof or thereof) that the General Partner
or  the  Liquidator  deems necessary or appropriate to form, qualify or continue
the existence or qualification of the Partnership as a limited partnership (or a
partnership  in  which the limited partners have limited liability) in the State
of  Delaware and in all other jurisdictions in which the Partnership may conduct
business  or own property; (B) all certificates, documents and other instruments
that  the  General  Partner  or the Liquidator deems necessary or appropriate to
reflect,  in  accordance  with its terms, any amendment, change, modification or
restatement  of  this  Agreement;  (C)  all  certificates,  documents  and other
instruments  (including  conveyances and a certificate of cancellation) that the
General  Partner or the Liquidator deems necessary or appropriate to reflect the
dissolution  and  liquidation  of  the Partnership pursuant to the terms of this
Agreement; (D) all certificates, documents and other instruments relating to the
admission,  withdrawal,  removal  or substitution of any Partner pursuant to, or
other  events  described  in,  Article  IV,  X, XI or XII; (E) all certificates,
                               --------------------------
documents  and  other  instruments  relating to the determination of the rights,
preferences  and  privileges  of  any  class  or series of Partnership Interests
issued  pursuant  hereto;  and  (F)  all  certificates,  documents  and  other
instruments  (including  agreements  and  a certificate of merger) relating to a
merger  or  consolidation  of  the  Partnership  pursuant  to  Article  XIV; and
                                                               ------------

               (ii)     execute, swear to, acknowledge, deliver, file and record
all  ballots,  consents,  approvals,  waivers, certificates, documents and other
instruments  necessary  or appropriate, in the discretion of the General Partner
or the Liquidator, to make, evidence, give, confirm or ratify any vote, consent,
approval,  agreement  or  other  action  that  is  made  or  given  by

                                       11
<PAGE>
the  Partners  hereunder or is consistent with the terms of this Agreement or is
necessary  or  appropriate,  in  the  discretion  of  the General Partner or the
Liquidator,  to effectuate the terms or intent of this Agreement; provided, that
when  required  by any provision of this Agreement that establishes a percentage
of  the  Limited  Partners  or  of  the  Limited Partners of any class or series
required to take any action, the General Partner and the Liquidator may exercise
the  power  of attorney made in this Section 2.6(a)(ii) only after the necessary
                                     ------------------
vote,  consent or approval of the Limited Partners or of the Limited Partners of
such  class  or  series,  as  applicable.

     Nothing  contained in this Section 2.6(a) shall be construed as authorizing
                                --------------
the  General  Partner  to amend this Agreement except in accordance with Article
                                                                         -------
XIII  or  as  may  be  otherwise  expressly  provided  for  in  this  Agreement.
----

          (b)     The  foregoing  power  of  attorney  is  hereby declared to be
irrevocable  and  a power coupled with an interest, and it shall survive and, to
the  maximum  extent  permitted by law, not be affected by the subsequent death,
incompetency,  disability, incapacity, dissolution, bankruptcy or termination of
any  Limited  Partner or Assignee and the transfer of all or any portion of such
Limited  Partner's  or  Assignee's Partnership Interest and shall extend to such
Limited  Partner's  or  Assignee's  heirs,  successors,  assigns  and  personal
representatives. Each such Limited Partner or Assignee hereby agrees to be bound
by  any  representation  made by the General Partner or the Liquidator acting in
good  faith pursuant to such power of attorney; and each such Limited Partner or
Assignee,  to  the  maximum  extent  permitted by law, hereby waives any and all
defenses that may be available to contest, negate or disaffirm the action of the
General  Partner  or  the  Liquidator  taken  in  good faith under such power of
attorney.  Each  Limited  Partner  or  Assignee shall execute and deliver to the
General  Partner  or the Liquidator, within 15 days after receipt of the request
therefor,  such further designation, powers of attorney and other instruments as
the  General  Partner  or  the  Liquidator  deems  necessary  to effectuate this
Agreement  and  the  purposes  of  the  Partnership.

     Section  2.7     Term.  The  term  of  the  Partnership  commenced upon the
                      ----
filing of the Certificate of Limited Partnership in accordance with the Delaware
Act  and shall continue in existence until the dissolution of the Partnership in
accordance  with the provisions of Article XII. The existence of the Partnership
                                   -----------
as  a  separate  legal  entity  shall  continue  until  the  cancellation of the
Certificate  of  Limited  Partnership  as  provided  in  the  Delaware  Act.

     Section  2.8     Title to Partnership Assets.  Title to Partnership assets,
                      ---------------------------
whether  real,  personal  or  mixed and whether tangible or intangible, shall be
deemed  to be owned by the Partnership as an entity, and no Partner or Assignee,
individually  or  collectively,  shall  have  any  ownership  interest  in  such
Partnership  assets  or  any  portion  thereof.  Title  to  any  or  all  of the
Partnership  assets  may  be  held  in  the name of the Partnership, the General
Partner,  one  or more of its Affiliates or one or more nominees, as the General
Partner may determine. The General Partner hereby declares and warrants that any
Partnership  assets  for  which  record title is held in the name of the General
Partner  or  one or more of its Affiliates or one or more nominees shall be held
by  the  General Partner or such Affiliate or nominee for the use and benefit of
the  Partnership  in accordance with the provisions of this Agreement; provided,
however,  that  the General Partner shall use reasonable efforts to cause record
title  to  such  assets (other than those assets in respect of which the General
Partner  determines  that  the  expense  and  difficulty  of

                                       12
<PAGE>
conveyancing makes transfer of record title to the Partnership impracticable) to
be  vested  in  the  Partnership  as  soon  as reasonably practicable; provided,
further,  that,  prior to any withdrawal or removal of the General Partner or as
soon thereafter as practicable, the General Partner shall use reasonable efforts
to effect the transfer of record title to the Partnership and, prior to any such
transfer,  will  provide  for the use of such assets in a manner satisfactory to
the General Partner. All Partnership assets shall be recorded as the property of
the  Partnership  in  its  books  and records, irrespective of the name in which
record  title  to  such  Partnership  assets  is  held.

                                   ARTICLE III

                           RIGHTS OF LIMITED PARTNERS

     Section  3.1     Limitation  of  Liability.  The  Limited  Partners and the
                      -------------------------
Assignees  shall  have  no  liability  under  this Agreement except as expressly
provided  in  this  Agreement  or  the  Delaware  Act.

     Section 3.2     Management of Business.  No Limited Partner or Assignee, in
                     ----------------------
its  capacity as such, shall participate in the operation, management or control
(within the meaning of the Delaware Act) of the Partnership's business, transact
any  business  in the Partnership's name or have the power to sign documents for
or  otherwise  bind  the  Partnership.  Any action taken by any Affiliate of the
General  Partner  or  any  officer, director, employee, manager, member, general
partner,  agent  or  trustee of the General Partner or any of its Affiliates, or
any  officer,  director,  employee,  manager,  member, general partner, agent or
trustee  of  a  Group Member, in its capacity as such, shall not be deemed to be
participation  in  the  control  of the business of the Partnership by a limited
partner  of  the  Partnership  (within  the  meaning of Section 17-303(a) of the
Delaware  Act)  and shall not affect, impair or eliminate the limitations on the
liability  of  the  Limited  Partners  or  Assignees  under  this  Agreement.

     Section 3.3     Outside Activities of the Limited Partners.  Subject to the
                     ------------------------------------------
provisions  of  Article II and the Omnibus Agreement, which shall continue to be
                ----------
applicable  to  the  Persons  referred  to  therein,  regardless of whether such
Persons  shall  also  be  Limited  Partners or Assignees, any Limited Partner or
Assignee  shall  be  entitled  to  and may have business interests and engage in
business  activities in addition to those relating to the Partnership, including
business  interests  and  activities  in direct competition with the Partnership
Group.  Neither the Partnership nor any of the other Partners or Assignees shall
have  any  rights  by  virtue  of this Agreement in any business ventures of any
Limited  Partner  or  Assignee.

     Section  3.4     Rights  of  Limited  Partners.
                      -----------------------------

          (a)     In  addition  to other rights provided by this Agreement or by
applicable  law,  and  except as limited by Section 3.4(b), each Limited Partner
                                            --------------
shall have the right, for a purpose reasonably related to such Limited Partner's
interest as a limited partner in the Partnership, upon reasonable written demand
and  at  such  Limited  Partner's  own  expense:

               (i)     promptly  after  becoming  available, to obtain a copy of
the  Partnership's  federal,  state  and local income tax returns for each year;

                                       13
<PAGE>
               (ii)     to  have furnished to him a current list of the name and
last known business, residence or mailing address of each Partner;

               (iii)     to  have  furnished to him a copy of this Agreement and
the Certificate of Limited Partnership and all amendments thereto, together with
a  copy of the executed copies of all powers of  attorney pursuant to which this
Agreement,  the  Certificate  of  Limited Partnership and all amendments thereto
have  been  executed;

               (iv)     to obtain true and full information regarding the amount
of  cash  and  a  description and statement of the Net Agreed Value of any other
Capital  Contribution  by  each  Partner  and  that  each  Partner has agreed to
contribute  in  the  future,  and  the  date on which each became a Partner; and

               (v)     to obtain such other information regarding the affairs of
the  Partnership  as  is  just  and  reasonable;  and

               (vi)     to obtain true and full information regarding the status
of  the  business  and  financial  condition  of  the  Partnership.

          (b)     The  General  Partner  may  keep confidential from the Limited
Partners  and  Assignees,  for  such period of time as the General Partner deems
reasonable,  (i) any information that the General Partner reasonably believes to
be  in  the  nature of trade secrets or (ii) other information the disclosure of
which  the  General  Partner  in  good  faith  believes  (A)  is not in the best
interests  of  the MLP or the Partnership Group, (B) could damage the MLP or the
Partnership  Group  or  (C)  that  any  Group  Member  is  required by law or by
agreement  with any third party to keep confidential (other than agreements with
Affiliates  of the Partnership the primary purpose of which is to circumvent the
obligations  set  forth  in  this  Section  3.4).
                                   ------------

                                   ARTICLE IV

                       TRANSFERS OF PARTNERSHIP INTERESTS

     Section  4.1     Transfer  Generally.
                      -------------------

          (a)     The  term "transfer," when used in this Agreement with respect
to  a Partnership Interest, shall be deemed to refer to a transaction by which a
General  Partner  assigns  its  General  Partner  Interest to another Person who
becomes the General Partner or by which the holder of a Limited Partner Interest
assigns  such  Limited  Partner  Interest  to another Person who is or becomes a
Limited Partner (or an Assignee), and includes a sale, assignment, gift, pledge,
encumbrance,  hypothecation,  mortgage, exchange or any other disposition by law
or  otherwise.

          (b)     No  Partnership  Interest shall be transferred, in whole or in
part,  except  in  accordance  with  the  terms and conditions set forth in this
Article  IV.  Any  transfer  or purported transfer of a Partnership Interest not
-----------
made  in  accordance  with  this  Article  IV  shall  be  null  and  void.
                                  -----------

                                       14
<PAGE>
          (c)     Nothing  contained  in  this  Agreement  shall be construed to
prevent  a disposition by any member of the General Partner of any or all of the
issued  and  outstanding  member  interests  of  the  General  Partner.

     Section 4.2     Transfer of General Partner's General Partner Interest.  No
                     ------------------------------------------------------
provision  of  this  Agreement  shall  be  construed to prevent (and the Limited
Partners do hereby expressly consent to) (i) the transfer by the General Partner
of  all  or a portion of its General Partner Interest to one or more Affiliates,
which  transferred  General Partner Interest, to the extent not transferred to a
successor  General  Partner, shall constitute a Limited Partner Interest or (ii)
the  transfer  by  the General Partner, in whole and not in part, of its General
Partner  Interest  upon  (a) its merger, consolidation or other combination into
any other Person or the transfer by it of all or substantially all of its assets
to  another  Person  or  (b)  sale of all or substantially all of the membership
interests  of  the  General Partner by its members if, in the case of a transfer
described  in  either clause (i) or (ii) of this sentence, the rights and duties
of  the  General  Partner  with  respect  to  the  General  Partner  Interest so
transferred  are assumed by the transferee and the transferee agrees to be bound
by  the  provisions  of  this  Agreement; provided, however, that in either such
case, the transferee is primarily controlled, directly or indirectly, by the MLP
or  the  MLP  General  Partner  or any Person primarily controlling, directly or
indirectly,  the  MLP  or  the  MLP  General Partner; provided, further, that in
either  such  case,  such  transferee furnishes to the Partnership an Opinion of
Counsel  that  such  merger,  consolidation, combination, transfer or assumption
will  not  result in a loss of limited liability of any Limited Partner or cause
the  Partnership  to  be taxable as a corporation or otherwise to be taxed as an
entity  for federal income tax purposes (to the extent not already so treated or
taxed).  In  the  case  of  a  transfer pursuant to this Section 4.2 to a Person
                                                         -----------
proposed  as  a  successor general partner of the Partnership, the transferee or
successor  (as  the  case may be) shall, subject to compliance with the terms of
Section  10.4, be admitted to the Partnership as the General Partner immediately
-------------
prior  to  the  transfer  of  the  Partnership Interest, and the business of the
Partnership  shall  continue  without  dissolution.

     Section  4.3     Transfer  of  a Limited Partner's Partnership Interest.  A
                      ------------------------------------------------------
Limited  Partner  may  transfer  all,  but not less than all, of its Partnership
Interest  as  a  Limited Partner in connection with the merger, consolidation or
other  combination  of such Limited Partner with or into any other Person or the
transfer  by  such  Limited Partner of all or substantially all of its assets to
another  Person  and,  following  any  such  transfer,  such Person may become a
Substituted  Limited  Partner pursuant to Article X.  Except as set forth in the
                                          ---------
immediately  preceding  sentence,  or  in  connection with any pledge of (or any
related  foreclosure  on) a Partnership Interest of a Limited Partner solely for
the purpose of securing, directly or indirectly, indebtedness of the Partnership
or  the  MLP,  a  Limited  Partner  may  not  transfer  all  or  any part of its
Partnership  Interest  or  withdraw  from  the  Partnership.

     Section  4.4     Restrictions  on  Transfers.
                      ---------------------------

          (a)     Notwithstanding  the  other  provisions of this Article IV, no
                                                                  ----------
transfer  of  any  Partnership Interest shall be made if such transfer would (i)
violate  the  then  applicable federal or state securities laws or the rules and
regulations  of  the  Commission,  any  state securities commission or any other
governmental  authority  with  jurisdiction  over  such  transfer,  (ii)

                                       15
<PAGE>
terminate the existence or qualification of the Partnership or the MLP under the
laws  of the jurisdiction of its formation or (iii) cause the Partnership or the
MLP  to be treated as an association taxable as a corporation or otherwise to be
taxed as an entity for federal income tax purposes (to the extent not already so
treated  or  taxed).

          (b)     The General Partner may impose restrictions on the transfer of
Partnership  Interests  if  a subsequent Opinion of Counsel determines that such
restrictions are necessary to avoid a significant risk of the Partnership or the
MLP  becoming taxable as a corporation or otherwise to be taxed as an entity for
federal  income  tax  purposes.  The  restrictions may be imposed by making such
amendments  to  this  Agreement  as  the  General  Partner  may  determine to be
necessary  or  appropriate  to  impose  such  restrictions.

                                    ARTICLE V

           CAPITAL CONTRIBUTIONS AND ISSUANCE OF PARTNERSHIP INTERESTS

     Section 5.1     Initial Contributions.  In connection with the formation of
                     ---------------------
the  Partnership  under  the Delaware Act, the General Partner purchased a 0.10%
General Partner Interest for $1.00 and was admitted as General Partner, and Penn
Octane Corporation purchased a 99.9% Limited Partner Interest in the Partnership
for  $999.00  and  was  admitted  as  a  Limited  Partner.

     Section  5.2     Contributions  Pursuant  to  the  Contribution  Agreement.
                      ---------------------------------------------------------

          (a)     Pursuant  to  the  Contribution  Agreement,  Penn  Octane
Corporation  shall  contribute  to  the  Partnership all of its right, title and
interest  in  the  Assets  as  a  Capital  Contribution.

          (b)     Penn  Octane  Corporation  then,  pursuant to the Contribution
Agreement,  shall  contribute  its  99.9%  Limited  Partner  Interest  in  the
Partnership  to  the  MLP  as  a  capital  contribution.

          (c)     Following the foregoing transactions, the General Partner will
continue  to  own  a  0.10%  General  Partner Interest, the MLP will own a 99.9%
Limited  Partner  Interest  and  shall be admitted as a Limited Partner and Penn
Octane  Corporation  shall  no  longer  own  any  Partnership Interest and shall
withdraw  as  a  Limited  Partner.

     Section  5.3     Additional Capital Contributions.  With the consent of the
                      --------------------------------
General  Partner,  any  Limited Partner may, but shall not be obligated to, make
additional  Capital Contributions to the Partnership. Contemporaneously with the
making  of  any Capital Contributions by a Limited Partner, in addition to those
provided in Sections 5.1 and 5.2, the General Partner shall be obligated to make
            --------------------
an additional Capital Contribution to the Partnership in an amount equal to 0.10
divided  by  99.9  times  the amount of the additional Capital Contribution then
made  by  such Limited Partner. Except as set forth in the immediately preceding
sentence  and in Article XII, the General Partner shall not be obligated to make
                 -----------
any  additional  Capital  Contributions  to  the  Partnership.

                                       16
<PAGE>
     Section  5.4     Interest and Withdrawal.  No interest shall be paid by the
                      -----------------------
Partnership  on Capital Contributions.  No Partner or Assignee shall be entitled
to  the  withdrawal or return of its Capital Contribution, except to the extent,
if  any,  that distributions made pursuant to this Agreement or upon termination
of  the Partnership may be considered as such by law and then only to the extent
provided  for in this Agreement. Except to the extent expressly provided in this
Agreement,  no Partner or Assignee shall have priority over any other Partner or
Assignee  either  as  to  the  return of Capital Contributions or as to profits,
losses  or  distributions.  Any  such  return shall be a compromise to which all
Partners  and  Assignees  agree  within  the meaning of Section 17-502(b) of the
Delaware  Act.

     Section  5.5     Capital  Accounts.
                      -----------------

          (a)     The  Partnership  shall  maintain  for  each  Partner  (or  a
beneficial owner of Partnership Interests held by a nominee in any case in which
the  nominee  has  furnished  the  identity  of such owner to the Partnership in
accordance  with  Section  6031(c) of the Code or any other method acceptable to
the  General  Partner  in  its  sole discretion) owning a Partnership Interest a
separate Capital Account with respect to such Partnership Interest in accordance
with  the  rules  of Treasury Regulation Section 1.704-1(b)(2)(iv). Such Capital
Account  shall  be increased by (i) the amount of all Capital Contributions made
to  the  Partnership  with respect to such Partnership Interest pursuant to this
Agreement  and (ii) all items of Partnership income and gain (including, without
limitation, income and gain exempt from tax) computed in accordance with Section
                                                                         -------
5.5(b)  and  allocated  with  respect  to  such Partnership Interest pursuant to
------
Section  6.1, and decreased by (x) the amount of cash or Net Agreed Value of all
------------
actual  and  deemed  distributions of cash or property made with respect to such
Partnership Interest pursuant to this Agreement and (y) all items of Partnership
deduction and loss computed in accordance with Section 5.5(b) and allocated with
                                               --------------
respect  to  such  Partnership  Interest  pursuant  to  Section  6.1.
                                                        ------------

          (b)     For  purposes  of  computing the amount of any item of income,
gain, loss or deduction that is to be allocated pursuant to Article VI and is to
                                                            ----------
be  reflected  in the Partners' Capital Accounts, the determination, recognition
and  classification  of  any  such  item shall be the same as its determination,
recognition  and  classification  for  federal  income  tax purposes (including,
without  limitation,  any  method of depreciation, cost recovery or amortization
used  for  that  purpose),  provided,  that:

               (i)     Solely  for purposes of this Section 5.5, the Partnership
                                                    -----------
shall  be  treated  as owning directly its proportionate share (as determined by
the  General  Partner)  of  all  property  owned  by  any OLP Subsidiary that is
classified  as  a  partnership  for  federal  income  tax  purposes.

               (ii)     All  fees and other expenses incurred by the Partnership
to  promote  the sale of (or to sell) a Partnership Interest that can neither be
deducted  nor  amortized  under  Section  709  of  the  Code, if any, shall, for
purposes  of  Capital Account maintenance, be treated as an item of deduction at
the  time such fees and other expenses are incurred and shall be allocated among
the  Partners  pursuant  to  Section  6.1.
                             ------------

                                       17
<PAGE>
               (iii)     Except  as  otherwise  provided  in Treasury Regulation
Section 1.704-1(b)(2)(iv)(m), computation of all items of income, gain, loss and
deduction  shall be made without regard to any election under Section 754 of the
Code  that  may  be  made by the Partnership and, as to those items described in
Section  705(a)(1)(B)  or  705(a)(2)(B)  of the Code, without regard to the fact
that  such  items  are  not  includable in gross income or are neither currently
deductible  nor  capitalized  for  federal income tax purposes. To the extent an
adjustment  to  the  adjusted  tax  basis  of  any Partnership asset pursuant to
Section  734(b)  or  743(b)  of  the  Code  is  required,  pursuant  to Treasury
Regulation Section 1.704-1(b)(2)(iv)(m), to be taken into account in determining
Capital Accounts, the amount of such adjustment in the Capital Accounts shall be
treated  as  an  item  of  gain  or  loss.

               (iv)     Any  income,  gain  or  loss attributable to the taxable
disposition  of  any Partnership property shall be determined as if the adjusted
basis  of  such  property as of such date of disposition were equal in amount to
the  Partnership's Carrying Value with respect to such property as of such date.

               (v)     In  accordance with the requirements of Section 704(b) of
the  Code,  any  deductions  for  depreciation,  cost  recovery  or amortization
attributable  to any Contributed Property shall be determined as if the adjusted
basis of such property on the date it was acquired by the Partnership were equal
to  the  Agreed  Value  of such property. Upon an adjustment pursuant to Section
                                                                         -------
5.5(d)  to  the  Carrying  Value  of  any  Partnership  property  subject  to
------
depreciation,  cost  recovery  or  amortization, any further deductions for such
depreciation,  cost recovery or amortization attributable to such property shall
be  determined  (A)  as if the adjusted basis of such property were equal to the
Carrying  Value  of  such property immediately following such adjustment and (B)
using  a  rate  of  depreciation, cost recovery or amortization derived from the
same method and useful life (or, if applicable, the remaining useful life) as is
applied  for  federal income tax purposes; provided, however, that, if the asset
has  a  zero  adjusted basis for federal income tax purposes, depreciation, cost
recovery  or  amortization  deductions  shall be determined using any reasonable
method  that  the  General  Partner  may  adopt.

               (vi)     If  the Partnership's adjusted basis in a depreciable or
cost  recovery  property  is reduced for federal income tax purposes pursuant to
Section  48(q)(1)  or  48(q)(3) of the Code, the amount of such reduction shall,
solely  for  purposes hereof, be deemed to be an additional depreciation or cost
recovery  deduction  in the year such property is placed in service and shall be
allocated  among  the Partners pursuant to Section 6.1.  Any restoration of such
                                           -----------
basis pursuant to Section 48(q)(2) of the Code shall, to the extent possible, be
allocated  in  the same manner to the Partners to whom such deemed deduction was
allocated.

          (c)     A  transferee of a Partnership Interest shall succeed to a pro
rata  portion  of  the  Capital  Account  of  the  transferor  relating  to  the
Partnership  Interest  so  transferred.

          (d)     (i)     In  accordance  with  Treasury  Regulation  Section
1.704-1(b)(2)(iv)(f),  on  an  issuance  of additional Partnership Interests for
cash  or  Contributed  Property,  the  Capital  Accounts of all Partners and the
Carrying  Value  of each Partnership property immediately prior to such issuance
shall  be  adjusted  upward  or  downward  to  reflect  any  Unrealized  Gain or
Unrealized  Loss  attributable  to  such  Partnership  property,  as  if  such

                                       18
<PAGE>
Unrealized Gain or Unrealized Loss had been recognized on an actual sale of each
such  property  immediately prior to such issuance and had been allocated to the
Partners  at such time pursuant to Section 6.1 in the same manner as any item of
                                   -----------
gain  or  loss actually recognized during such period would have been allocated.
In  determining  such  Unrealized  Gain  or  Unrealized Loss, the aggregate cash
amount  and  fair  market  value  of  all Partnership assets (including, without
limitation,  cash  or  cash  equivalents)  immediately  prior to the issuance of
additional  Partnership  Interests  shall  be  determined by the General Partner
using  such  reasonable  method of valuation as it may adopt; provided, however,
that  the  General  Partner, in arriving at such valuation, must take fully into
account  the  fair  market value of the Partnership Interests of all Partners at
such  time.  The  General  Partner shall allocate such aggregate value among the
assets  of the Partnership (in such manner as it determines in its discretion to
be reasonable) to arrive at a fair market value for individual properties.

               (i)     In  accordance  with  Treasury  Regulation  Section
1.704-1(b)(2)(iv)(f),  immediately prior to any actual or deemed distribution to
a Partner of any Partnership property (other than a distribution of cash that is
not in redemption or retirement of a Partnership Interest), the Capital Accounts
of  all  Partners  and  the  Carrying Value of all Partnership property shall be
adjusted  upward  or  downward to reflect any Unrealized Gain or Unrealized Loss
attributable  to  such  Partnership  property,  as  if  such  Unrealized Gain or
Unrealized Loss had been recognized in a sale of such property immediately prior
to  such distribution for an amount equal to its fair market value, and had been
allocated  to the Partners, at such time, pursuant to Section 6.1(c) in the same
                                                      --------------
manner  as any item of gain or loss actually recognized during such period would
have  been allocated. In determining such Unrealized Gain or Unrealized Loss the
aggregate  cash  amount  and  fair  market  value  of  all  Partnership  assets
(including, without limitation, cash or cash equivalents) immediately prior to a
distribution  shall  (A)  in the case of an actual distribution that is not made
pursuant  to Section 12.4 or in the case of a deemed distribution, be determined
             ------------
and allocated in the same manner as that provided in Section 5.5(d)(i) or (B) in
                                                     ----------------
the  case  of a liquidating distribution pursuant to Section 12.4, be determined
                                                     ------------
and  allocated by the Liquidator using such reasonable method of valuation as it
may  adopt.

     Section 5.6     Loans from Partners.  Loans by a Partner to the Partnership
                     -------------------
shall  not  constitute Capital Contributions. If any Partner shall advance funds
to the Partnership in excess of the amounts required hereunder to be contributed
by  it  to  the  capital  of the Partnership, the making of such excess advances
shall  not  result  in any increase in the amount of the Capital Account of such
Partner.  The  amount  of any such excess advances shall be a debt obligation of
the  Partnership to such Partner and shall be payable or collectible only out of
the  Partnership  assets  in accordance with the terms and conditions upon which
such  advances  are  made.

     Section  5.7     Issuances  of  Additional  Partnership  Securities.
                      --------------------------------------------------

          (a)     The  Partnership  may  issue additional Partnership Securities
and  options,  rights,  warrants  and  appreciation  rights  relating  to  the
Partnership  Securities for any Partnership purpose at any time and from time to
time  to such Persons for such consideration and on such terms and conditions as
shall  be  established  by  the  General  Partner  in  its  sole discretion. The

                                       19
<PAGE>
issuance  by  the  Partnership  of Partnership Securities or rights, warrants or
appreciation  rights  in  respect  thereof  shall be deemed an amendment to this
Agreement.

          (b)     Each  additional  Partnership Security authorized to be issued
by  the  Partnership  pursuant  to  Section  5.7(a) may be issued in one or more
                                    ---------------
classes,  or  one  or  more  series of any such classes, with such designations,
preferences,  rights, powers and duties (which may be senior to existing classes
and  series of Partnership Securities), as shall be fixed by the General Partner
in its sole discretion, including (i) the right to share Partnership profits and
losses  or  items thereof; (ii) the right to share in Partnership distributions;
(iii)  the  rights  upon  dissolution  and  liquidation of the Partnership; (iv)
whether,  and  the  terms  and conditions upon which, the Partnership may redeem
such  Partnership Security; (v) whether such Partnership Security is issued with
the  privilege of conversion or exchange and, if so, the terms and conditions of
such  conversion  or  exchange;  (vi)  the  terms and conditions upon which each
Partnership  Security  will be issued, evidenced by certificates and assigned or
transferred; and (vii) the right, if any, of the holder of each such Partnership
Security  to  vote  on  Partnership  matters,  including matters relating to the
relative  designations,  preferences,  rights,  powers  and  duties  of  such
Partnership  Security.

          (c)     The  General Partner is hereby authorized and directed to take
all  actions  that it deems necessary or appropriate in connection with (i) each
issuance  of  Partnership  Securities  and  options,  rights,  warrants  and
appreciation  rights relating to Partnership Securities pursuant to this Section
                                                                         -------
5.7,  (ii) the admission of Additional Limited Partners and (iii) all additional
---
issuances  of  Partnership Securities. The General Partner is further authorized
and directed to specify the relative rights, powers and duties of the holders of
the  Partnership  Interests or other Partnership Securities being so issued. The
General  Partner  shall  do all things necessary to comply with the Delaware Act
and  is authorized and directed to do all things it deems necessary or advisable
in  connection  with  any  future  issuance of Partnership Securities, including
compliance with any statute, rule, regulation or guideline of any federal, state
or  other  governmental  agency.

     Section  5.8     Limited  Preemptive Rights.  Except as provided in Section
                      --------------------------                         -------
5.3,  no Person shall have preemptive, preferential or other similar rights with
---
respect  to  (a)  additional  Capital Contributions; (b) issuance or sale of any
class or series of Partnership Interests, whether unissued, held in the treasury
or hereafter created; (c) issuance of any obligations, evidences of indebtedness
or  other securities of the Partnership convertible into or exchangeable for, or
carrying  or accompanied by any rights to receive, purchase or subscribe to, any
such  Partnership  Interests;  (d)  issuance  of any right of subscription to or
right  to  receive,  or  any  warrant  or  option  for the purchase of, any such
Partnership  Interests; or (e) issuance or sale of any other securities that may
be  issued  or  sold  by  the  Partnership.

     Section  5.9     Fully  Paid  and  Non-Assessable Nature of Limited Partner
                      ----------------------------------------------------------
Interests.  All  Limited Partner Interests issued pursuant to, and in accordance
---------
with  the requirements of, this Article V shall be fully paid and non-assessable
                                ---------
Limited  Partner  Interests, except as such non-assessability may be affected by
Section  17-607  of  the  Delaware  Act.

                                       20
<PAGE>
                                   ARTICLE VI

                          ALLOCATIONS AND DISTRIBUTIONS

     Section  6.1     Allocations for Capital Account Purposes.  For purposes of
                      ----------------------------------------
maintaining  the  Capital Accounts and in determining the rights of the Partners
among  themselves,  the  Partnership's items of income, gain, loss and deduction
(computed  in  accordance  with  Section  5.5(b))  shall  be allocated among the
                                 ---------------
Partners  in  each  taxable  year (or portion thereof) as provided herein below.

          (a)     Net  Income.  After  giving  effect to the special allocations
                  -----------
set  forth  in Section 6.1(d), Net Income for each taxable year and all items of
               --------------
income,  gain, loss and deduction taken into account in computing Net Income for
such taxable year shall be allocated among the Partners as follows:

               (i)     First,  100%  to the General Partner, until the aggregate
Net  Income  allocated to the General Partner pursuant to this Section 6.1(a)(i)
                                                               -----------------
for  the  current  taxable  year  and all previous taxable years is equal to the
aggregate  Net  Losses  allocated  to  the  General  Partner pursuant to Section
                                                                         -------
6.1(b)(ii)  for  all  previous  taxable  years;
----------

               (ii)     Second,  0.10%  to  the General Partner and 99.9% to the
Limited Partners in accordance with their respective Percentage Interests.

          (b)     Net  Losses.  After  giving  effect to the special allocations
                  -----------
set forth in Section 6.1(d), Net Losses for each taxable period and all items of
             --------------
income,  gain, loss and deduction taken into account in computing Net Losses for
such taxable period shall be allocated among the Partners as follows:

               (i)     First,  0.10%  to  the  General  Partner and 99.9% to the
Limited  Partners,  in  accordance  with  their respective Percentage Interests;
provided,  however,  that Net Losses shall not be allocated to a Limited Partner
pursuant  to  this  Section  6.1(b)(i)  to the extent that such allocation would
                    ------------------
cause  a  Limited  Partner  to  have  a  deficit balance in its Adjusted Capital
Account  at  the  end  of  such  taxable  year (or increase any existing deficit
balance in such Limited Partner's Adjusted Capital Account);

               (ii)     Second,  the  balance,  if  any,  100%  to  the  General
Partner.

          (c)     Net  Termination Gains and Losses.  After giving effect to the
                  ---------------------------------
special allocations set forth in Section 6.1(d), all items of income, gain, loss
                                 --------------
and  deduction  taken  into  account  in  computing  Net Termination Gain or Net
Termination  Loss  for such taxable period shall be allocated in the same manner
as such Net Termination Gain or Net Termination Loss is allocated hereunder. All
allocations  under  this  Section  6.1(c)  shall  be  made after Capital Account
                          ---------------
balances have been adjusted by all other allocations provided under this Section
                                                                         -------
6.1  and  after  all  distributions of Available Cash provided under Section 6.4
---                                                                  -----------
have  been  made  with  respect  to  the  taxable period ending on or before the
Liquidation  Date;  provided,  however, that solely for purposes of this Section
                                                                         -------
6.1(c),  Capital  Accounts shall not be adjusted for distributions made pursuant
------
to  Section  12.4.
    -------------

                                       21
<PAGE>
               (i)     If  a  Net  Termination  Gain  is  recognized  (or deemed
recognized  pursuant  to  Section  5.5(d)),  such  Net Termination Gain shall be
                          ---------------
allocated  among  the Partners in the following manner (and the Capital Accounts
of  the  Partners  shall  be increased by the amount so allocated in each of the
following subclauses, in the order listed, before an allocation is made pursuant
to  the  next  succeeding  subclause):

                    (A)     First,  to each Partner having a deficit  balance in
its  Capital  Account,  in the proportion that such deficit balance bears to the
total  deficit balances in the Capital Accounts of all Partners, until each such
Partner  has  been  allocated  Net  Termination  Gain  equal to any such deficit
balance  in  its  Capital  Account;  and

                    (B)     Second,  0.10%  to  the General Partner and 99.9% to
the  Limited Partners, in accordance with their respective Percentage Interests.

               (ii)     If  a  Net  Termination  Loss  is  recognized (or deemed
recognized  pursuant  to  Section  5.5(d)),  such  Net Termination Loss shall be
                          ---------------
allocated  among  the  Partners  in  the  following  manner:

                    (A)     First,  to  the  General  Partner  and  the  Limited
Partners  in proportion to, and to the extent of, the positive balances in their
respective  Capital  Accounts;  and

                    (B)     Second,  the  balance,  if  any, 100% to the General
Partner.

          (d)     Special  Allocations.  Notwithstanding  any other provision of
                  --------------------
this  Section  6.1,  the  following  special  allocations shall be made for such
      ------------
taxable  period:

               (i)     Partnership Minimum Gain Chargeback.  Notwithstanding any
                       -----------------------------------
other  provision  of this Section 6.1, if there is a net decrease in Partnership
                          -----------
Minimum  Gain  during  any  Partnership  taxable  period,  each Partner shall be
allocated  items  of  Partnership  income  and  gain  for  such  period (and, if
necessary,  subsequent  periods)  in the manner and amounts provided in Treasury
Regulation  Sections  1.704-2(f)(6),  1.704-2(g)(2) and 1.704-2(j)(2)(i), or any
successor  provision.  For  purposes  of  this  Section  6.1(d),  each Partner's
                                                ---------------
Adjusted  Capital  Account  balance  shall  be determined, and the allocation of
income or gain required hereunder shall be effected, prior to the application of
any  other  allocations  pursuant  to  this  Section 6.1(d) with respect to such
                                             --------------
taxable  period  (other  than  an  allocation pursuant to Sections 6.1(d)(v) and
                                                          ----------------------
6.1(d)(vi)).  This  Section 6.1(d)(i) is intended to comply with the Partnership
-----------          ----------------
Minimum  Gain  chargeback  requirement in Treasury Regulation Section 1.704-2(f)
and  shall  be  interpreted  consistently  therewith.

               (ii)     Chargeback  of  Partner  Nonrecourse  Debt Minimum Gain.
                        -------------------------------------------------------
Notwithstanding  the  other  provisions  of this Section 6.1 (other than Section
                                                 -----------             -------
6.1(d)(i)),  except as provided in Treasury Regulation Section 1.704-2(i)(4), if
----------
there  is  a  net  decrease  in Partner Nonrecourse Debt Minimum Gain during any
Partnership taxable period, any Partner with a share of Partner Nonrecourse Debt
Minimum Gain at the beginning of such taxable period shall be allocated items of
Partnership  income  and  gain  for  such  period (and, if necessary, subsequent
periods)  in  the  manner  and  amounts provided in Treasury Regulation Sections
1.704-2(i)(4)  and  1.704-2(j)(2)(ii), or any successor provisions. For purposes
of this Section 6.1(d), each Partner's
        --------------

                                       22
<PAGE>
Adjusted  Capital  Account  balance  shall  be determined, and the allocation of
income or gain required hereunder shall be effected, prior to the application of
any  other  allocations  pursuant  to  this  Section  6.1(d), other than Section
                                             ---------------             -------
6.1(d)(i)  and  other  than  an  allocation  pursuant  to Sections 6.1(d)(v) and
---------                                                 ----------------------
6.1(d)(vi),  with  respect  to  such  taxable period. This Section 6.1(d)(ii) is
----------                                                 ------------------
intended  to  comply with the chargeback of items of income and gain requirement
in  Treasury  Regulation  Section  1.704-2(i)(4)  and  shall  be  interpreted
consistently  therewith.

               (iii)     Qualified  Income  Offset.  In  the  event  any Partner
                         -------------------------
unexpectedly receives any adjustments, allocations or distributions described in
Treasury  Regulation  Sections 1.704-1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5),
or  1.704-1(b)(2)(ii)(d)(6),  items  of  Partnership  income  and  gain shall be
specially  allocated  to  such  Partner  in  an  amount and manner sufficient to
eliminate,  to the extent required by the Treasury Regulations promulgated under
Section 704(b) of the Code, the deficit balance, if any, in its Adjusted Capital
Account  created by such adjustments, allocations or distributions as quickly as
possible unless such deficit balance is otherwise eliminated pursuant to Section
                                                                         -------
6.1(d)(i)  or  (ii).
-------------------

               (iv)     Gross  Income Allocations.  In the event any Partner has
                        -------------------------
a  deficit  balance in its Capital Account at the end of any Partnership taxable
period  in  excess  of  the  sum  of  (A) the amount such Partner is required to
restore  pursuant  to  the  provisions of this Agreement and (B) the amount such
Partner  is deemed obligated to restore pursuant to Treasury Regulation Sections
1.704-2(g) and 1.704-2(i)(5), such Partner shall be specially allocated items of
Partnership  gross  income  and  gain in the amount of such excess as quickly as
possible; provided, that an allocation pursuant to this Section 6.1(d)(iv) shall
                                                        ------------------
be made only if and to the extent that such Partner would have a deficit balance
in  its  Capital Account as adjusted after all other allocations provided for in
this  Section  6.1 have been tentatively made as if this Section 6.1(d)(iv) were
      ------------                                       ------------------
not  in  this  Agreement.

               (v)     Nonrecourse  Deductions.  Nonrecourse  Deductions for any
                       -----------------------
taxable  period  shall  be  allocated  to  the Partners in accordance with their
respective  Percentage  Interests. If the General Partner determines in its good
faith discretion that the Partnership's Nonrecourse Deductions must be allocated
in  a  different  ratio  to satisfy the safe harbor requirements of the Treasury
Regulations promulgated under Section 704(b) of the Code, the General Partner is
authorized, upon notice to the other Partners, to revise the prescribed ratio to
the  numerically  closest  ratio  that  does  satisfy  such  requirements.

               (vi)     Partner  Nonrecourse  Deductions.  Partner  Nonrecourse
                        --------------------------------
Deductions  for  any  taxable period shall be allocated 100% to the Partner that
bears  the Economic Risk of Loss with respect to the Partner Nonrecourse Debt to
which  such  Partner  Nonrecourse Deductions are attributable in accordance with
Treasury  Regulation  Section  1.704-2(i).  If  more  than one Partner bears the
Economic  Risk  of Loss with respect to a Partner Nonrecourse Debt, such Partner
Nonrecourse  Deductions attributable thereto shall be allocated between or among
such  Partners  in  accordance with the ratios in which they share such Economic
Risk  of  Loss.

               (vii)     Nonrecourse  Liabilities.  For  purposes  of  Treasury
                         ------------------------
Regulation  Section  1.752-3(a)(3),  the  Partners  agree  that  Nonrecourse
Liabilities  of  the  Partnership  in  excess  of  the  sum of (A) the amount of
Partnership  Minimum  Gain and (B) the total amount of

                                       23
<PAGE>
Nonrecourse  Built-in  Gain  shall be allocated among the Partners in accordance
with  their  respective  Percentage  Interests.

               (viii)     Code  Section  754  Adjustments.  To  the  extent  an
                          -------------------------------
adjustment  to  the  adjusted  tax  basis  of  any Partnership asset pursuant to
Section  734(b)  or  743(c)  of  the  Code  is  required,  pursuant  to Treasury
Regulation Section 1.704-1(b)(2)(iv)(m), to be taken into account in determining
Capital Accounts, the amount of such adjustment to the Capital Accounts shall be
treated  as an item of gain (if the adjustment increases the basis of the asset)
or  loss (if the adjustment decreases such basis), and such item of gain or loss
shall  be  specially  allocated  to the Partners in a manner consistent with the
manner  in  which their Capital Accounts are required to be adjusted pursuant to
such  Section  of  the  Treasury  Regulations.

               (ix)     Curative  Allocation.
                        --------------------

                    (A)     Notwithstanding  any other provision of this Section
                                                                         -------
6.1,  other  than  the  Required  Allocations, the Required Allocations shall be
---
taken  into  account  in  making  the  Agreed Allocations so that, to the extent
possible,  the net amount of items of income, gain, loss and deduction allocated
to each Partner pursuant to the Required Allocations and the Agreed Allocations,
together,  shall  be  equal to the net amount of such items that would have been
allocated  to  each  such  Partner under the Agreed Allocations had the Required
Allocations  and  the related Curative Allocation not otherwise been provided in
this  Section  6.1. Notwithstanding the preceding sentence, Required Allocations
      ------------
relating to (1) Nonrecourse Deductions shall not be taken into account except to
the  extent  that  there has been a decrease in Partnership Minimum Gain and (2)
Partner  Nonrecourse  Deductions  shall  not be taken into account except to the
extent  that there has been a decrease in Partner Nonrecourse Debt Minimum Gain.
Allocations  pursuant  to  this  Section  6.1(d)(ix)(A)  shall only be made with
                                 ----------------------
respect  to  Required  Allocations  to the extent the General Partner reasonably
determines  that  such  allocations  will  otherwise  be  inconsistent  with the
economic  agreement  among  the  Partners. Further, allocations pursuant to this
Section  6.1(d)(ix)(A) shall be deferred with respect to allocations pursuant to
----------------------
clauses  (1)  and  (2)  hereof  to  the  extent  the  General Partner reasonably
determines  that such allocations are likely to be offset by subsequent Required
Allocations.

                    (B)     The  General  Partner  shall  have  reasonable
discretion,  with respect to each taxable period, to (1) apply the provisions of
Section  6.1(d)(ix)(A) in whatever order is most likely to minimize the economic
----------------------
distortions  that  might otherwise result from the Required Allocations, and (2)
divide all allocations pursuant to Section 6.1(d)(ix)(A) among the Partners in a
                                   ---------------------
manner  that  is  likely  to  minimize  such  economic  distortions.

     Section  6.2     Allocations  for  Tax  Purposes.
                      -------------------------------

          (a)     Except  as  otherwise  provided herein, for federal income tax
purposes, each item of income, gain, loss and deduction shall be allocated among
the  Partners in the same manner as its correlative item of "book" income, gain,
loss  or  deduction  is  allocated  pursuant  to  Section  6.1.
                                                  ------------

                                       24
<PAGE>
          (b)     In  an  attempt to eliminate Book-Tax Disparities attributable
to  a  Contributed  Property  or Adjusted Property, items of income, gain, loss,
depreciation,  amortization  and cost recovery deductions shall be allocated for
federal  income  tax  purposes  among  the  Partners  as  follows:

               (i)     (A)  In  the  case  of a Contributed Property, such items
attributable  thereto  shall  be  allocated  among  the  Partners  in the manner
provided  under Section 704(c) of the Code that takes into account the variation
between the Agreed Value of such property and its  adjusted basis at the time of
contribution; and (B) any item of Residual Gain or Residual Loss attributable to
a  Contributed Property shall be allocated among the Partners in the same manner
as  its correlative item of "book" gain or loss is allocated pursuant to Section
                                                                         -------
6.1.
---

               (ii)     (A)  In  the  case  of  an Adjusted Property, such items
shall (1) first, be allocated among the Partners in a manner consistent with the
principles  of  Section  704(c)  of the Code to take into account the Unrealized
Gain  or  Unrealized  Loss  attributable  to  such  property and the allocations
thereof  pursuant  to  Section  5.5(d)(i)  or 5.5(d)(ii), and (2) second, in the
                       ---------------------------------
event  such  property  was originally a Contributed Property, be allocated among
the  Partners in a manner consistent with Section 6.2(b)(i)(A); and (B) any item
                                          --------------------
of  Residual Gain or Residual Loss attributable to an Adjusted Property shall be
allocated  among  the  Partners  in  the  same manner as its correlative item of
"book"  gain  or  loss  is  allocated  pursuant  to  Section  6.1.
                                                     ------------

               (iii)     The  General  Partner  shall  apply  the  principles of
Treasury  Regulation  Section  1.704-3(d)  to  eliminate  Book-Tax  Disparities.

          (c)     For  the  proper administration of the Partnership and for the
preservation  of  uniformity  of the Units or other limited partner interests of
the  MLP  (or any class or classes thereof), the General Partner shall have sole
discretion  to (i) adopt such conventions as it deems appropriate in determining
the amount of depreciation, amortization and cost recovery deductions; (ii) make
special  allocations  for  federal  income  tax  purposes  of income (including,
without  limitation, gross income) or deductions; and (iii) amend the provisions
of  this Agreement as appropriate (x) to reflect the proposal or promulgation of
Treasury  Regulations  under Section 704(b) or Section 704(c) of the Code or (y)
otherwise  to  preserve  or  achieve  uniformity  of  the Units or other limited
partner  interests  of  the  MLP  (or any class or classes thereof). The General
Partner  may  adopt  such  conventions,  make  such  allocations  and  make such
amendments  to  this  Agreement  as provided in this Section 6.2(c) only if such
                                                     --------------
conventions,  allocations or amendments would not have a material adverse effect
on  the  Partners, the holders of any class or classes of Units or other limited
partner  interests  of the MLP issued and outstanding or the Partnership, and if
such  allocations are consistent with the principles of Section 704 of the Code.

          (d)     The  General  Partner  in  its  discretion  may  determine  to
depreciate  or amortize the portion of an adjustment under Section 743(b) of the
Code  attributable  to  unrealized appreciation in any Adjusted Property (to the
extent of the unamortized Book-Tax Disparity) using a predetermined rate derived
from  the  depreciation  or  amortization  method and useful life applied to the
Partnership's  common  basis of such property, despite any inconsistency of such
approach  with  Treasury  Regulation  Section  1.167(c)-l(a)(6) or any successor
regulations  thereto.

                                       25
<PAGE>
     If  the  General  Partner  determines  that  such reporting position cannot
reasonably be taken, the General Partner may adopt depreciation and amortization
conventions  under  which  all purchasers acquiring limited partner interests of
the  MLP  in  the  same  month  would  receive  depreciation  and  amortization
deductions,  based  upon  the  same  applicable  rate as if they had purchased a
direct  interest  in  the Partnership's property. If the General Partner chooses
not  to  utilize  such  aggregate  method, the General Partner may use any other
reasonable  depreciation and amortization conventions to preserve the uniformity
of the intrinsic tax characteristics of any limited partner interests of the MLP
that  would not have a material adverse effect on the Partners or the holders of
any  class  or  classes  of  limited  partner  interests  of  the  MLP.

          (e)     Any  gain  allocated  to  the  Partners upon the sale or other
taxable  disposition  of  any  Partnership  asset shall, to the extent possible,
after  taking  into  account other required allocations of gain pursuant to this
Section 6.2, be characterized as Recapture Income in the same proportions and to
-----------
the  same  extent as such Partners (or their predecessors in interest) have been
allocated  any deductions directly or indirectly giving rise to the treatment of
such  gains  as  Recapture  Income.

          (f)     All  items  of  income,  gain,  loss,  deduction  and  credit
recognized  by  the Partnership for federal income tax purposes and allocated to
the  Partners  in  accordance  with  the  provisions  hereof shall be determined
without regard to any election under Section 754 of the Code that may be made by
the  Partnership;  provided, however, that such allocations, once made, shall be
adjusted  as  necessary  or  appropriate  to take into account those adjustments
permitted  or  required  by  Sections  734  and  743  of  the  Code.

          (g)     The  General  Partner  may adopt such methods of allocation of
income,  gain,  loss  or  deduction  between  a transferor and a transferee of a
Partnership  Interest  as  it  determines  necessary  or appropriate in its sole
discretion,  to  the extent permitted or required by Section 706 of the Code and
the  regulations  or  rulings  promulgated  thereunder.

          (h)     Allocations  that  would  otherwise be made to a Partner under
the  provisions of this Article VI shall instead be made to the beneficial owner
                        ----------
of  Partnership Interests held by a nominee in any case in which the nominee has
furnished  the  identity  of  such  owner  to the Partnership in accordance with
Section  6031(c)  of  the  Code  or  any  other method acceptable to the General
Partner  in  its  sole  discretion.

     Section  6.3     Distributions.
                      -------------

          (a)     Within  45  days  following the end of each Quarter, an amount
equal  to  100% of Available Cash with respect to such Quarter shall, subject to
Section  17-607  of  the  Delaware  Act,  be distributed in accordance with this
Article  VI  by  the  Partnership  to  the  Partners  in  accordance  with their
-----------
respective  Percentage  Interests.  The immediately preceding sentence shall not
require any distribution of cash if and to the extent such distribution would be
prohibited  by  applicable  law  or  by  any loan agreement, security agreement,
mortgage,  debt  instrument  or  other  agreement  or  obligation  to  which the
Partnership  is  a  party or by which it is bound or its assets are subject. All
distributions  required to be made under this Agreement shall be made subject to
Section  17-607  of  the  Delaware  Act.

                                       26
<PAGE>
          (b)     In  the  event  of  the  dissolution  and  liquidation  of the
Partnership,  all  receipts  received  during  or after the Quarter in which the
Liquidation  Date occurs, other than from borrowings described in (a)(ii) of the
definition  of  Available  Cash,  shall  be  applied  and  distributed solely in
accordance  with,  and  subject  to  the  terms and conditions of, Section 12.4.
                                                                   ------------

          (c)     The  General  Partner shall have the discretion to treat taxes
paid  by  the Partnership on behalf of, or amounts withheld with respect to, all
or  less  than  all of the Partners, as a distribution of Available Cash to such
Partners.

                                   ARTICLE VII

                      MANAGEMENT AND OPERATION OF BUSINESS

     Section  7.1     Management.
                      ----------

          (a)     The  General  Partner  shall  conduct,  direct  and manage all
activities  of  the  Partnership. Except as otherwise expressly provided in this
Agreement,  all  management  powers  over  the  business  and  affairs  of  the
Partnership  shall  be exclusively vested in the General Partner, and no Limited
Partner  or  Assignee  shall  have  any  management  power over the business and
affairs of the Partnership. In addition to the powers now or hereafter granted a
general  partner  of  a  limited  partnership  under  applicable law or that are
granted  to the General Partner under any other provision of this Agreement, the
General  Partner, subject to Section 7.3, shall have full power and authority to
                             -----------
do  all  things  and  on  such  terms  as  it,  in its sole discretion, may deem
necessary or appropriate to conduct the business of the Partnership, to exercise
all  powers set forth in Section 2.5 and to effectuate the purposes set forth in
                         -----------
Section  2.4,  including  the  following:
------------

               (i)     the  making of any expenditures, the lending or borrowing
of money, the assumption or guarantee of, or other contracting for, indebtedness
and  other  liabilities,  the  issuance  of evidences of indebtedness, including
indebtedness  that is convertible into a Partnership Interest, and the incurring
of  any  other  obligations;

               (ii)     the  making  of  tax,  regulatory  and other filings, or
rendering  of periodic or other reports to governmental or other agencies having
jurisdiction  over  the  business  or  assets  of  the  Partnership;

               (iii)     the  acquisition,  disposition,  mortgage,  pledge,
encumbrance,  hypothecation  or  exchange  of  any  or  all of the assets of the
Partnership  or  the merger or other combination of the Partnership with or into
another  Person  (the  matters  described  in  this  clause (iii) being subject,
however,  to  any  prior  approval  that  may  be  required  by  Section  7.3);
                                                                 ------------

               (iv)     the use of the assets of the Partnership (including cash
on  hand) for any purpose consistent with the terms of this Agreement, including
the financing of the conduct of the operations of the Partnership Group; subject
to Section 7.6, the lending of funds to other Persons (including the MLP and any
   -----------
member of the Partnership Group); the repayment of obligations of the MLP or any
member  of  the Partnership Group and the making of capital contributions to any
member  of  the  Partnership  Group;

                                       27
<PAGE>
               (v)     the  negotiation,  execution  and  performance  of  any
contracts,  conveyances  or  other instruments (including instruments that limit
the  liability  of  the  Partnership  under  contractual  arrangements to all or
particular  assets  of  the Partnership, with the other party to the contract to
have  no  recourse  against  the  General  Partner  or its assets other than its
interest  in  the  Partnership,  even  if  same  results  in  the  terms  of the
transaction  being less favorable to the Partnership than would otherwise be the
case);

               (vi)     the  distribution  of  Partnership  cash;

               (vii)     the  selection  and  dismissal  of employees (including
employees  having  titles such as "president," "vice president," "secretary" and
"treasurer")  and  agents,  outside  attorneys,  accountants,  consultants  and
contractors  and  the  determination  of  their  compensation and other terms of
employment  or  hiring;

               (viii)     the  maintenance  of such insurance for the benefit of
the  Partnership  Group  and  the Partners as it deems necessary or appropriate;

               (ix)     the  formation of, or acquisition of an interest in, and
the  contribution of property and the making of loans to, any further limited or
general  partnerships, joint ventures, corporations, limited liability companies
or  other  relationships  subject  to the restrictions set forth in Section 2.4;
                                                                    -----------

               (x)     the  control  of  any  matters  affecting  the rights and
obligations  of the Partnership, including the bringing and defending of actions
at  law or in equity and otherwise engaging in the conduct of litigation and the
incurring  of  legal  expense  and  the settlement of claims and litigation; and

               (xi)     the  indemnification  of  any Person against liabilities
and  contingencies  to  the  extent  permitted  by  law.

          (b)     Notwithstanding any other provision of this Agreement, the MLP
Agreement,  the  Delaware Act or any applicable law, rule or regulation, each of
the Partners and the Assignees and each other Person who may acquire an interest
in  the  Partnership  hereby  (i) approves, ratifies and confirms the execution,
delivery  and  performance by the parties thereto of this Agreement, the Omnibus
Agreement,  the  Contribution  Agreement  and the other agreements and documents
described in or filed as exhibits to the Registration Statement that are related
to the transactions contemplated by the Registration Statement; (ii) agrees that
the  General  Partner  (on its own or through any officer of the Partnership) is
authorized  to execute, deliver and perform the agreements referred to in clause
(i)  of  this  sentence,  as  applicable,  and  the  other  agreements,  acts,
transactions  and  matters  described  in  or  contemplated  by the Registration
Statement on behalf of the Partnership without any further act, approval or vote
of  the  Partners  or  the  Assignees  or  the  other Persons who may acquire an
interest  in  the  Partnership; and (iii) agrees that the execution, delivery or
performance  by  the General Partner, the MLP, any Group Member or any Affiliate
of any of them, of this Agreement or any agreement authorized or permitted under
this  Agreement  (including the exercise by the General Partner or any Affiliate
of the General Partner of the rights accorded pursuant to Article XV), shall not
                                                          ----------
constitute  a breach

                                       28
<PAGE>
by  the  General  Partner  of  any  duty  that  the  General Partner may owe the
Partnership  or  the  Limited Partners or any other Persons under this Agreement
(or  any  other  agreements)  or of any duty stated or implied by law or equity.

     Section  7.2     Certificate  of  Limited Partnership.  The General Partner
                      ------------------------------------
has caused the Certificate of Limited Partnership to be filed with the Secretary
of  State  of the State of Delaware as required by the Delaware Act. The General
Partner  shall  use  all  reasonable  efforts  to  cause  to be filed such other
certificates  or  documents  as  may be determined by the General Partner in its
sole discretion to be reasonable and necessary or appropriate for the formation,
continuation,  qualification  and  operation  of  a  limited  partnership  (or a
partnership  in  which the limited partners have limited liability) in the State
of Delaware or any other state in which the Partnership may elect to do business
or  own  property.  To  the extent that such action is determined by the General
Partner  in  its  sole discretion to be reasonable and necessary or appropriate,
the General Partner shall file amendments to and restatements of the Certificate
of  Limited  Partnership  and  do  all  things  to maintain the Partnership as a
limited  partnership  (or  a  partnership  or  other entity in which the limited
partners  have  limited liability) under the laws of the State of Delaware or of
any  other  state  in  which  the  Partnership  may  elect to do business or own
property.  Subject to the terms of Section 3.4(a), the General Partner shall not
                                   --------------
be  required,  before  or  after  filing,  to  deliver  or  mail  a  copy of the
Certificate  of Limited Partnership, any qualification document or any amendment
thereto  to  any  Limited  Partner  or  Assignee.

     Section  7.3     Restrictions  on  the  General  Partner's  Authority.
                      ----------------------------------------------------

          (a)     The  General  Partner may not, without written approval of the
specific act by the Limited Partners or by other written instrument executed and
delivered by the Limited Partners subsequent to the date of this Agreement, take
any  action  in  contravention of this Agreement, including, except as otherwise
provided in this Agreement, (i) committing any act that would make it impossible
to  carry  on  the  ordinary  business  of  the  Partnership;  (ii)  possessing
Partnership  property, or assigning any rights in specific Partnership property,
for  other  than  a  Partnership purpose; (iii) admitting a Person as a Partner;
(iv)  amending  this  Agreement  in  any manner; or (v) transferring its General
Partner  Interest.

          (b)     Except  as  provided  in  Articles  XII  and  XIV, the General
                                            -----------------------
Partner  may not sell, exchange or otherwise dispose of all or substantially all
of  the  Partnership's  assets  in  a  single transaction or a series of related
transactions (including by way of merger, consolidation or other combination) or
approve  on behalf of the Partnership the sale, exchange or other disposition of
all  or substantially all of the assets of the Partnership, without the approval
of the Limited Partners; provided however that this provision shall not preclude
or limit the General Partner's ability to mortgage, pledge, hypothecate or grant
a security interest in all or substantially all of the assets of the Partnership
and  shall  not  apply  to  any  forced  sale of any or all of the assets of the
Partnership  pursuant to the foreclosure of, or other realization upon, any such
encumbrance.

                                       29
<PAGE>
     Section  7.4     Reimbursement  of  the  General  Partner.
                      ----------------------------------------

          (a)     Except  as  provided in this Section 7.4 and elsewhere in this
                                               -----------
Agreement  or  in  the  Omnibus  Agreement,  the  General  Partner  shall not be
compensated  for  its  services  as  General  Partner  or  as general partner or
managing  member  of  any  Group  Member.

          (b)     The General Partner shall be reimbursed on a monthly basis, or
such  other  reasonable  basis  as the General Partner may determine in its sole
discretion,  for  (i)  all direct and indirect expenses it incurs or payments it
makes  on  behalf  of  the  Partnership  (including  salary,  bonus,  incentive
compensation  and  other  amounts paid to any Person including Affiliates of the
General  Partner  to  perform  services  for  the Partnership or for the General
Partner  in  the discharge of its duties to the Partnership), and (ii) all other
necessary  or  appropriate  expenses  allocable  to the Partnership or otherwise
reasonably  incurred  by  the  General  Partner in connection with operating the
Partnership's  business  (including expenses allocated to the General Partner by
its  Affiliates).  The  General  Partner  shall  determine the expenses that are
allocable  to the Partnership in any reasonable manner determined by the General
Partner  in  its  sole  discretion.  Reimbursements pursuant to this Section 7.4
                                                                     -----------
shall  be in addition to any reimbursement to the General Partner as a result of
indemnification  pursuant  to  Section  7.7.
                               ------------

          (c)     Subject  to  Section  5.7,  the  General  Partner, in its sole
                               ------------
discretion  and  without the approval of the Limited Partners (who shall have no
right  to  vote  in  respect  thereof),  may  propose and adopt on behalf of the
Partnership employee benefit plans, employee programs and employee practices, or
cause  the  Partnership  to  issue  Partnership  Interests in connection with or
pursuant  to  any  employee  benefit plan, employee program or employee practice
maintained or sponsored by the General Partner or any of its Affiliates, in each
case  for  the  benefit of employees of the General Partner, any Group Member or
any  Affiliate,  or  any  of them, in respect of services performed, directly or
indirectly,  for  the benefit of the Partnership Group. Expenses incurred by the
General  Partner in connection with any such plans, programs and practices shall
be reimbursed in accordance with Section 7.4(b).  Any and all obligations of the
                                 --------------
General  Partner under any employee benefit plans, employee programs or employee
practices  adopted  by  the  General Partner as permitted by this Section 7.4(c)
                                                                  --------------
shall  constitute  obligations  of  the  General  Partner hereunder and shall be
assumed  by  any  successor General Partner approved pursuant to Section 11.1 or
                                                                 ---------------
11.2  or  the transferee of or successor to all of the General Partner's General
----
Partner  Interest  pursuant  to  Section  4.2.
                                 ------------

     Section  7.5     Outside  Activities.
                      -------------------

          (a)     After the Closing Date, the General Partner, for so long as it
is  the  General  Partner  of the Partnership, (i) agrees that its sole business
will  be  to act as the General Partner of the Partnership and a general partner
or  managing  member,  as  the  case may be, of any other partnership or limited
liability company of which the Partnership is, directly or indirectly, a partner
or  member,  and  to undertake activities that are ancillary or related thereto,
and  (ii)  shall  not  engage  in any business or activity or incur any debts or
liabilities  except  in  connection with or incidental to (A) its performance as
general  partner of the Partnership or one or more Group Members or as described
in or contemplated by the Registration Statement or (B) the acquiring, owning or
disposing  of  debt  or  equity  securities  in  any  Group  Member.

                                       30
<PAGE>
          (b)     Except  as  specifically  restricted by Section 7.5(a) and the
                                                          --------------
Omnibus  Agreement,  each Indemnitee (other than the General Partner) shall have
the  right  to  engage  in  businesses  of  every type and description and other
activities for profit and to engage in and possess an interest in other business
ventures  of any and every type or description, whether in businesses engaged in
or anticipated to be engaged in by the MLP or any Group Member, independently or
with  others,  including business interests and activities in direct competition
with the business and activities of the MLP or any Group Member, and none of the
same  shall constitute a breach of this Agreement or any duty express or implied
by  law  to  the MLP or any Group Member or any Partner or Assignee. Neither the
MLP  nor  any  Group Member, any Limited Partner nor any other Person shall have
any  rights  by  virtue  of this Agreement, the MLP Agreement or the partnership
relationship  established  hereby  or  thereby  in  any business ventures of any
Indemnitee.

          (c)     Subject to the terms of Section 7.5(a), Section 7.5(b) and the
                                          --------------  -------------
Omnibus  Agreement,  but  otherwise  notwithstanding anything to the contrary in
this  Agreement,  (i)  the  engaging in competitive activities by any Indemnitee
(other  than  the  General  Partner)  in  accordance with the provisions of this
Section  7.5  is  hereby  approved  by the Partnership and all Partners, (ii) it
------------
shall  be  deemed  not to be a breach of the General Partner's fiduciary duty or
any  other  obligation  of  any  type  whatsoever of the General Partner for the
Indemnitees  (other  than  the  General  Partner)  to  engage  in  such business
interests and activities in preference to or to the exclusion of the Partnership
and  (iii)  except  as set forth in the Omnibus Agreement, the Indemnitees shall
have  no  obligation  to  present  business  opportunities  to  the Partnership.

          (d)     The  General  Partner  and  any  of its Affiliates may acquire
Units  or other MLP Securities in addition to those acquired on the Closing Date
and,  except  as  otherwise  provided  in  this  Agreement, shall be entitled to
exercise  all  rights  relating  to  such  Units  or  MLP  Securities.

          (e)     The  term "Affiliates" when used in Section 7.5(a) and Section
                             ----------               --------------------------
7.5(d) with respect to the General Partner shall not include any Group Member or
------
any  Subsidiary  of  the  MLP  or  any  Group  Member.

          (f)     Anything in this Agreement to the contrary notwithstanding, to
the  extent that provisions of Sections 7.7, 7.8, 7.9, 7.10 or other Sections of
                               ----------------------------
this  Agreement purport or are interpreted to have the effect of restricting the
fiduciary  duties  that  might  otherwise,  as  a  result  of  Delaware or other
applicable  law,  be  owed  by  the  General  Partner to the Partnership and its
Limited  Partners,  or to constitute a waiver or consent by the Limited Partners
to  any  such  restriction,  such  provisions  shall be inapplicable and have no
effect  in  determining  whether  the  General  Partner  has  complied  with its
fiduciary duties in connection with determinations made by it under this Section
                                                                         -------
7.5.
---

     Section 7.6     Loans from the General Partner; Loans or Contributions from
                     -----------------------------------------------------------
the  Partnership; Contracts with Affiliates; Certain Restrictions on the General
--------------------------------------------------------------------------------
Partner.
-------

          (a)     The  General  Partner or any of its Affiliates may lend to the
Partnership,  the  MLP  or any Group Member, and the Partnership, the MLP or any
Group Member may

                                       31
<PAGE>
borrow  from  the  General  Partner  or  any  of its Affiliates, funds needed or
desired  by  the  MLP  or  the Group Member for such periods of time and in such
amounts  as  the  General  Partner may determine; provided, however, that in any
such  case  the  lending  party may not charge the borrowing party interest at a
rate  greater  than the rate that would be charged the borrowing party or impose
terms  less favorable to the borrowing party than would be charged or imposed on
the  borrowing  party  by  unrelated  lenders  on  comparable  loans  made on an
arm's-length basis (without reference to the lending party's financial abilities
or  guarantees).  The  borrowing party shall reimburse the lending party for any
costs  (other  than any additional interest costs) incurred by the lending party
in  connection  with  the  borrowing of such funds. For purposes of this Section
                                                                         -------
7.6(a)  and  Section 7.6(b), the term "Group Member" shall include any Affiliate
---------------------------
of  a  Group  Member  that  is  controlled  by  the  Group  Member.

          (b)     The  Partnership  may  lend or contribute to any Group Member,
and  any  Group  Member  may  borrow  from  the  Partnership, funds on terms and
conditions  established in the sole discretion of the General Partner; provided,
however, that the Partnership may not charge the Group Member interest at a rate
less  than the rate that would be charged to the Group Member (without reference
to the General Partner's financial abilities or guarantees) by unrelated lenders
on  comparable  loans. The foregoing authority shall be exercised by the General
Partner  in  its  sole  discretion  and shall not create any right or benefit in
favor  of  any  Group  Member  or  any  other  Person.

          (c)     The General Partner may itself, or may enter into an agreement
with  the  MLP General Partner or any of its Affiliates to, render services to a
Group Member or to the General Partner in the discharge of its duties as general
partner  of  the  Partnership.  Any  services  rendered to a Group Member by the
General  Partner, the MLP General Partner or any of their Affiliates shall be on
terms  that  are fair and reasonable to the Partnership; provided, however, that
the  requirements of this Section 7.6(c) shall be deemed satisfied as to (i) any
                          --------------
transaction  approved  by  Special  Approval, (ii) any transaction, the terms of
which  are no less favorable to the Partnership Group than those generally being
provided  to  or available from unrelated third parties or (iii) any transaction
that,  taking into account the totality of the relationships between the parties
involved  (including  other  transactions  that may be particularly favorable or
advantageous  to  the Partnership Group), is equitable to the Partnership Group.
The provisions of Section 7.4 shall apply to the rendering of services described
                  -----------
in  this  Section  7.6(c).
          ---------------

          (d)     The  Partnership  Group may transfer assets to joint ventures,
other  partnerships, corporations, limited liability companies or other business
entities  in  which  it  is or thereby becomes a participant upon such terms and
subject  to such conditions as are consistent with this Agreement and applicable
law.

          (e)     Neither  the  General  Partner nor any of its Affiliates shall
sell,  transfer  or  convey  any property to, or purchase any property from, the
Partnership,  directly  or  indirectly, except pursuant to transactions that are
fair and reasonable to the Partnership; provided, however, that the requirements
of  this  Section  7.6(e)  shall  be  deemed  to  be  satisfied  as  to  (i) the
          ---------------
transactions  effected  pursuant  to  Sections  5.2  and  5.3,  the Contribution
                                      -----------------------
Agreement  and  any  other  transactions  described  in  or  contemplated by the
Registration Statement, (ii) any transaction approved by Special Approval, (iii)
any  transaction,  the  terms  of which are no less favorable to

                                       32
<PAGE>
the  Partnership  than  those  generally  being  provided  to  or available from
unrelated  third  parties, or (iv) any transaction that, taking into account the
totality  of  the  relationships  between  the parties involved (including other
transactions  that  may  be  particularly  favorable  or  advantageous  to  the
Partnership  Group),  is  equitable  to  the  Partnership.

          (f)     The General Partner and its Affiliates will have no obligation
to  permit  any  Group  Member  to  use  any facilities or assets of the General
Partner  and its Affiliates, except as may be provided in contracts entered into
from  time  to  time  specifically dealing with such use, nor shall there be any
obligation  on  the  part of the General Partner or its Affiliates to enter into
such  contracts.

          (g)     Without  limitation  of  Sections  7.6(a)  through 7.6(f), and
                                           --------------------------------
notwithstanding anything to the contrary in this Agreement, the existence of the
conflicts  of  interest  described  in  the  Registration  Statement  are hereby
approved  by  all  Partners.

     Section  7.7     Indemnification.
                      ---------------

          (a)     To  the  fullest  extent  permitted  by law but subject to the
limitations  expressly  provided  in  this  Agreement,  all Indemnitees shall be
indemnified  and  held  harmless by the Partnership from and against any and all
losses,  claims,  damages,  liabilities,  joint  or several, expenses (including
legal  fees and expenses), judgments, fines, penalties, interest, settlements or
other  amounts  arising  from  any  and  all  claims, demands, actions, suits or
proceedings,  whether civil, criminal, administrative or investigative, in which
any  Indemnitee  may be involved, or is threatened to be involved, as a party or
otherwise, by reason of its status as an Indemnitee; provided, that in each case
the  Indemnitee  acted  in  good  faith  and  in  a  manner that such Indemnitee
reasonably believed to be in, or (in the case of a Person other than the General
Partner) not opposed to, the best interests of the Partnership and, with respect
to  any  criminal proceeding, had no reasonable cause to believe its conduct was
unlawful;  provided,  further,  no  indemnification pursuant to this Section 7.7
                                                                     -----------
shall  be  available  to  the  General  Partner  with respect to its obligations
incurred  pursuant  to  the Underwriting Agreement or the Contribution Agreement
(other  than  obligations  incurred  by  the  General  Partner  on behalf of the
Partnership).  The  termination  of  any action, suit or proceeding by judgment,
order,  settlement,  conviction  or  upon  a  plea  of  nolo  contendere, or its
equivalent, shall not create a presumption that the Indemnitee acted in a manner
contrary  to  that specified above. Any indemnification pursuant to this Section
                                                                         -------
7.7  shall  be  made  only out of the assets of the Partnership, it being agreed
---
that the General Partner shall not be personally liable for such indemnification
and shall have no obligation to contribute or loan any monies or property to the
Partnership  to  enable  it  to  effectuate  such  indemnification.

          (b)     To  the  fullest  extent permitted by law, expenses (including
legal  fees  and expenses) incurred by an Indemnitee who is indemnified pursuant
to  Section  7.7(a)  in  defending any claim, demand, action, suit or proceeding
    ---------------
shall,  from  time  to  time,  be advanced by the Partnership prior to the final
disposition  of  such  claim, demand, action, suit or proceeding upon receipt by
the  Partnership  of  any undertaking by or on behalf of the Indemnitee to repay
such  amount if it shall be determined that the Indemnitee is not entitled to be
indemnified  as  authorized  in  this  Section  7.7.
                                       ------------

                                       33
<PAGE>
          (c)     The  indemnification  provided by this Section 7.7 shall be in
                                                         -----------
addition  to  any  other rights to which an Indemnitee may be entitled under any
agreement,  pursuant  to  any  vote  of  the  Partners,  as  a  matter of law or
otherwise,  both as to actions in the Indemnitee's capacity as an Indemnitee and
as  to  actions  in  any  other  capacity  (including  any  capacity  under  the
Underwriting  Agreement),  and shall continue as to an Indemnitee who has ceased
to  serve  in  such  capacity  and  shall  inure  to  the  benefit of the heirs,
successors,  assigns  and  administrators  of  the  Indemnitee.

          (d)     The  Partnership  may  purchase and maintain (or reimburse the
General  Partner  or its Affiliates for the cost of) insurance, on behalf of the
General  Partner,  its  Affiliates and such other Persons as the General Partner
shall  determine,  against any liability that may be asserted against or expense
that  may  be  incurred  by  such  Person  in  connection with the Partnership's
activities  or such Person's activities on behalf of the Partnership, regardless
of whether the Partnership would have the power to indemnify such Person against
such  liability  under  the  provisions  of  this  Agreement.

          (e)     For  purposes  of  this  Section 7.7, the Partnership shall be
                                           -----------
deemed  to  have  requested  an  Indemnitee to serve as fiduciary of an employee
benefit  plan  whenever  the  performance by it of its duties to the Partnership
also  imposes  duties  on,  or otherwise involves services by, it to the plan or
participants  or  beneficiaries  of  the  plan;  excise  taxes  assessed  on  an
Indemnitee  with  respect to an employee benefit plan pursuant to applicable law
shall  constitute "fines" within the meaning of Section 7.7(a); and action taken
                                                --------------
or omitted by it with respect to any employee benefit plan in the performance of
its  duties for a purpose reasonably believed by it to be in the interest of the
participants  and  beneficiaries of the plan shall be deemed to be for a purpose
that  is  in,  or  not  opposed  to,  the  best  interests  of  the Partnership.

          (f)     In  no event may an Indemnitee subject the Limited Partners to
personal liability by reason of the indemnification provisions set forth in this
Agreement.

          (g)     An  Indemnitee shall not be denied indemnification in whole or
in  part  under  this  Section 7.7 because the Indemnitee had an interest in the
                       -----------
transaction with respect to which the indemnification applies if the transaction
was  otherwise  permitted  by  the  terms  of  this  Agreement.

          (h)     The  provisions of this Section 7.7 are for the benefit of the
                                          -----------
Indemnitees,  their  heirs, successors, assigns and administrators and shall not
be deemed to create any rights for the benefit of any other Persons.

          (i)     No  amendment,  modification  or repeal of this Section 7.7 or
                                                                  -----------
any  provision  hereof shall in any manner terminate, reduce or impair the right
of  any past, present or future Indemnitee to be indemnified by the Partnership,
nor  the  obligations  of the Partnership to indemnify any such Indemnitee under
and  in  accordance  with  the  provisions  of  this  Section  7.7  as in effect
                                                      ------------
immediately  prior  to  such  amendment,  modification or repeal with respect to
claims arising from or relating to matters occurring, in whole or in part, prior
to  such  amendment,  modification or repeal, regardless of when such claims may
arise  or  be  asserted.

                                       34
<PAGE>
     Section  7.8     Liability  of  Indemnitees.
                      --------------------------

          (a)     Notwithstanding  anything  to  the  contrary set forth in this
Agreement,  no  Indemnitee  shall  be  liable  for  monetary  damages  to  the
Partnership,  the  Limited Partners, the Assignees or any other Persons who have
acquired interests in the Units or other MLP Securities, for losses sustained or
liabilities incurred as a result of any act or omission if such Indemnitee acted
in  good  faith.

          (b)     Subject  to  its obligations and duties as General Partner set
forth  in  Section  7.1(a),  the  General Partner may exercise any of the powers
           ---------------
granted  to  it  by this Agreement and perform any of the duties imposed upon it
hereunder  either  directly or by or through its agents, and the General Partner
shall  not  be  responsible  for any misconduct or negligence on the part of any
such  agent  appointed  by  the  General  Partner  in  good  faith.

          (c)     To  the  extent  that,  at law or in equity, an Indemnitee has
duties  (including  fiduciary  duties)  and  liabilities relating thereto to the
Partnership  or  to  the  Partners, the General Partner and any other Indemnitee
acting  in  connection  with  the Partnership's business or affairs shall not be
liable  to  the Partnership or to any Partner for its good faith reliance on the
provisions  of  this  Agreement. The provisions of this Agreement, to the extent
that  they  restrict  or  otherwise  modify  the  duties  and  liabilities of an
Indemnitee otherwise existing at law or in equity, are agreed by the Partners to
replace  such  other  duties  and  liabilities  of  such  Indemnitee.

          (d)     Any  amendment,  modification or repeal of this Section 7.8 or
                                                                  -----------
any  provision  hereof shall be prospective only and shall not in any way affect
the  limitations  on the liability to the Partnership, the Limited Partners, the
General Partner, and the Partnership's and General Partner's directors, officers
and  employees  under  this  Section  7.8 as in effect immediately prior to such
                             ------------
amendment,  modification  or  repeal  with  respect  to  claims  arising from or
relating  to  matters  occurring,  in whole or in part, prior to such amendment,
modification or repeal, regardless of when such claims may arise or be asserted.

     Section  7.9     Resolution  of  Conflicts  of  Interest.
                      ---------------------------------------

          (a)     Unless  otherwise  expressly provided in this Agreement or the
MLP  Agreement,  whenever  a  potential  conflict  of  interest exists or arises
between  the  General Partner or any of its Affiliates, on the one hand, and the
Partnership,  the MLP, any Partner or any Assignee, on the other, any resolution
or  course of action by the General Partner or its Affiliates in respect of such
conflict of interest shall be permitted and deemed approved by all Partners, and
shall  not  constitute  a breach of this Agreement, of the MLP Agreement, of any
agreement  contemplated  herein  or therein, or of any duty stated or implied by
law or equity, if the resolution or course of action is, or by operation of this
Agreement  is  deemed to be, fair and reasonable to the Partnership. The General
Partner  shall  be authorized but not required in connection with its resolution
of such conflict of interest to seek Special Approval of such resolution and the
General  Partner  may  also  adopt a resolution or course of action that has not
received  Special  Approval.  Any  Special  Approval  shall  be  subject  to the
presumption  that,  in  making its decision, the Conflicts Committee acted on an
informed basis, in good faith and in the honest belief that the action taken was
in  the  best  interests  of  the Partnership and the MLP and, in any proceeding

                                       35
<PAGE>
brought by any Limited Partner or by or on behalf of such Limited Partner or any
other  Limited Partners or the Partnership challenging such approval, the Person
bringing or prosecuting such proceeding shall have the burden of overcoming such
presumption.  Any  conflict  of  interest and any resolution of such conflict of
interest  shall be conclusively deemed fair and reasonable to the Partnership if
such  conflict  of  interest  or resolution is (i) approved by Special Approval,
(ii)  on  terms  no less favorable to the Partnership than those generally being
provided  to  or  available  from  unrelated  third parties or (iii) fair to the
Partnership,  taking  into account the totality of the relationships between the
parties  involved  (including  other  transactions  that  may  be  particularly
favorable  or  advantageous  to  the  Partnership). The General Partner may also
adopt  a  resolution or course of action that has not received Special Approval.
The  General Partner shall be authorized in connection with its determination of
what  is  "fair  and  reasonable"  to the Partnership and in connection with its
resolution of any conflict of interest to consider (A) the relative interests of
any party to such conflict, agreement, transaction or situation and the benefits
and  burdens  relating  to such interest; (B) any customary or accepted industry
practices and any customary or historical dealings with a particular Person; (C)
any  applicable  generally  accepted accounting practices or principles; and (D)
such additional factors as the General Partner determines in its sole discretion
to  be  relevant,  reasonable  or  appropriate  under  the circumstances. In any
proceeding  brought  by  any  Limited Partner or by or on behalf of such Limited
Partner  or  any  other Limited Partners or the Partnership alleging that such a
resolution  by  the General Partner is not fair to the Partnership, such Limited
Partner  shall  have  the burden of proof of overcoming such conclusion. Nothing
contained  in  this Agreement, however, is intended to nor shall it be construed
to  require  the  General  Partner to consider the interests of any Person other
than  the  Partnership.  In the absence of bad faith by the General Partner, the
resolution,  action  or  terms so made, taken or provided by the General Partner
with  respect  to such matter shall not constitute a breach of this Agreement or
any  other  agreement contemplated herein or a breach of any standard of care or
duty  imposed  herein  or  therein or, to the extent permitted by law, under the
Delaware  Act  or  any  other  law,  rule  or  regulation.

          (b)     Whenever  this  Agreement  or any other agreement contemplated
hereby  provides  that the General Partner or any of its Affiliates is permitted
or  required  to  make  a decision (i) in its "sole discretion" or "discretion,"
that  it deems "necessary or appropriate" or "necessary or advisable" or under a
grant of similar authority or latitude, except as otherwise provided herein, the
General  Partner  or  such  Affiliate  shall  be  entitled to consider only such
interests and factors as it desires and shall have no duty or obligation to give
any consideration to any interest of, or factors affecting, the Partnership, the
MLP,  any Limited Partner or any Assignee, (ii) it may make such decision in its
sole discretion (regardless of whether there is a reference to "sole discretion"
or  "discretion")  unless  another express standard is provided for, or (iii) in
"good  faith"  or  under  another  express standard, the General Partner or such
Affiliate  shall act under such express standard and shall not be subject to any
other  or  different standards imposed by this Agreement, the MLP Agreement, any
other  agreement contemplated hereby or under the Delaware Act or any other law,
rule  or  regulation.  In  addition, any actions taken by the General Partner or
such  Affiliate  consistent  with  the  standards of "reasonable discretion" set
forth  in  the definition of Available Cash shall not constitute a breach of any
duty  of  the  General  Partner  to the Partnership or the Limited Partners. The
General  Partner  shall  have  no duty, express or implied, to sell or otherwise
dispose  of any asset of the Partnership Group other than in the ordinary course
of  business.  No  borrowing  by  any  Group  Member  or  the  approval  thereof

                                       36
<PAGE>
by the General Partner shall be deemed to constitute a breach of any duty of the
General Partner to the Partnership or the Limited Partners by reason of the fact
that  the  purpose  or effect of such borrowing is directly or indirectly to (A)
enable distributions to the General Partner or its Affiliates to exceed 0.10% of
the total amount distributed to all Partners or (B) hasten the expiration of the
Subordination  Period  or  the  conversion of any Subordinated Units into Common
Units.

          (c)     Whenever  a  particular transaction, arrangement or resolution
of  a  conflict  of  interest  is  required under this Agreement to be "fair and
reasonable"  to  any Person, the fair and reasonable nature of such transaction,
arrangement  or  resolution shall be considered in the context of all similar or
related  transactions.

          (d)     The  Limited Partner hereby authorizes the General Partner, on
behalf  of  the Partnership as a partner or member of a Group Member, to approve
of  actions  by  the  general  partner  or  managing member of such Group Member
similar  to  those actions permitted to be taken by the General Partner pursuant
to  this  Section  7.9.
          ------------

     Section  7.10     Other  Matters  Concerning  the  General  Partner.
                       -------------------------------------------------

          (a)     The  General Partner may rely and shall be protected in acting
or  refraining  from  acting  upon  any  resolution,  certificate,  statement,
instrument, opinion, report, notice, request, consent, order, bond, debenture or
other  paper or document believed by it to be genuine and to have been signed or
presented  by  the  proper  party  or  parties.

          (b)     The  General  Partner  may  consult  with  legal  counsel,
accountants,  appraisers,  management  consultants, investment bankers and other
consultants  and  advisers  selected  by  it, and any act taken or omitted to be
taken  in  reliance  upon  the opinion (including an Opinion of Counsel) of such
Persons  as to matters that the General Partner reasonably believes to be within
such  Person's  professional or expert competence shall be conclusively presumed
to  have been done or omitted in good faith and in accordance with such opinion.

          (c)     The General Partner shall have the right, in respect of any of
its  powers  or obligations hereunder, to act through any of its duly authorized
officers,  a duly appointed attorney or attorneys-in-fact or the duly authorized
officers  of  the  Partnership.

          (d)     Any  standard  of  care  and duty imposed by this Agreement or
under  the  Delaware  Act  or  any  applicable  law, rule or regulation shall be
modified,  waived  or  limited,  to  the extent permitted by law, as required to
permit  the  General  Partner to act under this Agreement or any other agreement
contemplated  by  this  Agreement  and  to  make  any  decision  pursuant to the
authority  prescribed  in  this  Agreement, so long as such action is reasonably
believed  by  the  General  Partner to be in, or not inconsistent with, the best
interests  of  the  Partnership.

     Section  7.11     Reliance  by  Third Parties.  Notwithstanding anything to
                       ---------------------------
the contrary in this Agreement, any Person dealing with the Partnership shall be
entitled  to  assume  that  the  General  Partner and any officer of the General
Partner authorized by the General Partner to act on behalf of and in the name of
the  Partnership  has  full  power  and  authority  to  encumber,  sell  or

                                       37
<PAGE>
otherwise  use  in any manner any and all assets of the Partnership and to enter
into  any  authorized  contracts  on  behalf of the Partnership, and such Person
shall  be entitled to deal with the General Partner or any such officer as if it
were  the  Partnership's  sole party in interest, both legally and beneficially.
Each  Limited  Partner hereby waives any and all defenses or other remedies that
may  be available against such Person to contest, negate or disaffirm any action
of  the General Partner or any such officer in connection with any such dealing.
In  no  event  shall  any  Person  dealing  with the General Partner or any such
officer  or  its representatives be obligated to ascertain that the terms of the
Agreement have been complied with or to inquire into the necessity or expedience
of  any  act  or  action  of  the  General  Partner  or  any such officer or its
representatives.  Each  and  every  certificate,  document  or  other instrument
executed  on  behalf  of  the  Partnership  by  the  General  Partner  or  its
representatives  shall  be  conclusive evidence in favor of any and every Person
relying thereon or claiming thereunder that (a) at the time of the execution and
delivery of such certificate, document or instrument, this Agreement was in full
force  and  effect,  (b)  the  Person executing and delivering such certificate,
document  or  instrument  was  duly authorized and empowered to do so for and on
behalf  of  the Partnership and (c) such certificate, document or instrument was
duly  executed and delivered in accordance with the terms and provisions of this
Agreement  and  is  binding  upon  the  Partnership.

                                  ARTICLE VIII

                          BOOKS, RECORDS AND ACCOUNTING

     Section  8.1     Records and Accounting.  The General Partner shall keep or
                      ----------------------
cause  to  be  kept at the principal office of the Partnership appropriate books
and  records with respect to the Partnership's business, including all books and
records necessary to provide to the Limited Partners any information required to
be  provided  pursuant to Section 3.4(a). Any books and records maintained by or
                          --------------
on  behalf  of  the Partnership in the regular course of its business, including
books  of  account and records of Partnership proceedings, may be kept on, or be
in  the  form  of,  computer  disks,  hard  drives,  punch cards, magnetic tape,
photographs,  micrographics  or  any other information storage device; provided,
that  the  books  and records so maintained are convertible into clearly legible
written  form  within  a reasonable period of time. The books of the Partnership
shall  be  maintained,  for financial reporting purposes, on an accrual basis in
accordance  with  U.S.  GAAP.

     Section 8.2     Fiscal Year.  The fiscal year of the Partnership shall be a
                     -----------
fiscal  year  ending  December  31.

                                   ARTICLE IX

                                   TAX MATTERS

     Section  9.1     Tax Returns and Information.  The Partnership shall timely
                      ---------------------------
file  all  returns  of  the Partnership that are required for federal, state and
local  income tax purposes on the basis of the accrual method and a taxable year
ending  on  December 31. The tax information reasonably required by the Partners
for  federal  and  state income tax reporting purposes with respect to a taxable
year  shall  be  furnished  to  them within 90 days of the close of the calendar

                                       38
<PAGE>
year  in  which  the  Partnership's  taxable  year  ends.  The  classification,
realization  and  recognition  of  income, gain, losses and deductions and other
items  shall  be  on  the  accrual  method  of accounting for federal income tax
purposes.

     Section  9.2     Tax  Elections.
                      --------------

          (a)     To  the extent applicable for federal income tax purposes, the
Partnership  shall make the election under Section 754 of the Code in accordance
with  applicable regulations thereunder, subject to the reservation of the right
to  seek  to  revoke  any such election upon the General Partner's determination
that  such  revocation  is  in  the  best  interests  of  the  Limited Partners.

          (b)     To  the extent applicable for federal income tax purposes, the
Partnership  shall  elect  to  deduct  expenses  incurred  in  organizing  the
Partnership  ratably over a sixty-month period as provided in Section 709 of the
Code.

          (c)     Except as otherwise provided herein, the General Partner shall
determine  whether  the Partnership should make any other elections permitted by
the  Code.

     Section  9.3     Tax  Controversies.  Subject to the provisions hereof, the
                      ------------------
General  Partner  is  designated  as  the Tax Matters Partner (as defined in the
Code)  and  is  authorized  and  required  to  represent the Partnership (at the
Partnership's  expense) in connection with all examinations of the Partnership's
affairs  by  tax  authorities,  including  resulting administrative and judicial
proceedings, and to expend Partnership funds for professional services and costs
associated  therewith. Each Partner agrees to cooperate with the General Partner
and  to  do  or  refrain from doing any or all things reasonably required by the
General  Partner  to  conduct  such  proceedings.

     Section  9.4     Withholding.  Notwithstanding  any other provision of this
                      -----------
Agreement,  the  General  Partner  is  authorized  to  take  any  action that it
determines  in  its  discretion  to  be  necessary  or  appropriate to cause the
Partnership  to  comply  with any withholding requirements established under the
Code  or  any  other  federal, state or local law including, without limitation,
pursuant  to  Sections 1441, 1442, 1445 and 1446 of the Code. To the extent that
the  Partnership  is  required  or elects to withhold and pay over to any taxing
authority  any amount resulting from the allocation or distribution of income to
any  Partner  or  Assignee  (including, without limitation, by reason of Section
1446  of  the  Code),  the  amount withheld may at the discretion of the General
Partner  be  treated  by  the  Partnership as a distribution of cash pursuant to
Section 6.3 in the amount of such withholding from such Partner.
-----------

                                    ARTICLE X

                              ADMISSION OF PARTNERS

     Section  10.1     Admission  of Partners.  As a result of  the consummation
                       ----------------------
of  the  transfers and conveyances described in Section 5.2, the General Partner
                                                -----------
shall  be  the  sole General Partner of the Partnership and the MLP shall be the
sole  Limited  Lartner  of  the  Partnership.

                                       39
<PAGE>
     Section  10.2     Admission of Substituted Limited Partner.  By transfer of
                       ----------------------------------------
a  Limited  Partner Interest in accordance with Article IV, the transferor shall
                                                ----------
be  deemed  to  have  given  the  transferee  the  right  to seek admission as a
Substituted  Limited  Partner  subject  to  the conditions of, and in the manner
permitted  under,  this  Agreement.  A  transferor of a Limited Partner Interest
shall,  however,  only  have  the  authority  to  convey to a purchaser or other
transferee  (a)  the  right  to  negotiate  such  Limited  Partner Interest to a
purchaser  or  other  transferee  and  (b)  the  right to request admission as a
Substituted  Limited Partner to such purchaser or other transferee in respect of
the  transferred Limited Partner Interests. Each transferee of a Limited Partner
Interest  shall  be  an  Assignee  and  be  deemed  to  have applied to become a
Substituted  Limited  Partner  with  respect to the Limited Partner Interests so
transferred  to  such  Person.  Such Assignee shall become a Substituted Limited
Partner  (x) at such time as the General Partner consents thereto, which consent
may  be  given or withheld in the General Partner's discretion, and (y) when any
such  admission  is  shown  on the books and records of the Partnership. If such
consent is withheld, such transferee shall remain an Assignee. An Assignee shall
have an interest in the Partnership equivalent to that of a Limited Partner with
respect  to  allocations and distributions, including liquidating distributions,
of  the  Partnership.  With  respect  to  voting  rights attributable to Limited
Partner  Interests  that  are  held  by  Assignees, the General Partner shall be
deemed  to  be the Limited Partner with respect thereto and shall, in exercising
the  voting  rights  in respect of such Limited Partner Interests on any matter,
vote such Limited Partner Interests at the written direction of the Assignee. If
no  such  written  direction is received, such Partnership Interests will not be
voted. An Assignee shall have no other rights of a Limited Partner.

     Section  10.3     Admission  of  Additional  Limited  Partners.
                       --------------------------------------------

          (a)     A  Person  (other  than  the  General  Partner,  the  MLP or a
Substituted Limited Partner) who makes a Capital Contribution to the Partnership
in  accordance  with  this  Agreement shall be admitted to the Partnership as an
Additional  Limited  Partner  only  upon  furnishing  to  the  General  Partner:

               (i)     evidence  of  acceptance  in  form  satisfactory  to  the
General  Partner of all of the terms and conditions of this Agreement, including
the  power  of  attorney  granted  in  Section  2.6,  and
                                       ------------

               (ii)     such  other  documents or instruments as may be required
in the discretion of the General Partner to effect such Person's admission as an
Additional  Limited  Partner.

          (b)     Notwithstanding anything to the contrary in this Section 10.3,
                                                                   ------------
no Person shall be admitted as an Additional Limited Partner without the consent
of  the  General  Partner, which consent may be given or withheld in the General
Partner's  discretion.  The  admission  of  any  Person as an Additional Limited
Partner shall become effective on the date upon which the name of such Person is
recorded  as  such  in  the  books and records of the Partnership, following the
consent  of  the  General  Partner  to  such  admission.

     Section  10.4     Admission  of Successor or Transferee General Partner.  A
                       -----------------------------------------------------
successor  General  Partner  approved  pursuant  to  Section 11.1 or 11.2 or the
                                                     --------------------
transferee  of or successor to all

                                       40
<PAGE>
of  the  General  Partner's  Partnership Interest pursuant to Section 4.2 who is
                                                              -----------
proposed  to  be  admitted  as  a  successor  General  Partner shall, subject to
compliance  with  the  terms  of Section 11.3, if applicable, be admitted to the
                                 ------------
Partnership  as  the  General  Partner,  effective  immediately  prior  to  the
withdrawal  or  removal  of  the  predecessor  or  transferring  General Partner
pursuant to Section 11.1 or 11.2 or the transfer of the General Partner Interest
            --------------------
pursuant  to  Section  4.2,  provided,  however, that no such successor shall be
              ------------
admitted  to  the Partnership until compliance with the terms of Section 4.2 has
occurred  and  such successor has executed and delivered such other documents or
instruments  as  may  be  required  to effect such admission. Any such successor
shall,  subject to the terms hereof, carry on the business of the members of the
Partnership  Group  without  dissolution.

     Section  10.5     Amendment  of  Agreement  and  Certificate  of  Limited
                       -------------------------------------------------------
Partnership.  To  effect  the  admission  to the Partnership of any Partner, the
-----------
General  Partner  shall  take  all  steps  necessary  and  appropriate under the
Delaware  Act  to amend the records of the Partnership to reflect such admission
and,  if  necessary,  to  prepare  as  soon  as practicable an amendment to this
Agreement and, if required by law, the General Partner shall prepare and file an
amendment to the Certificate of Limited Partnership, and the General Partner may
for  this purpose, among others, exercise the power of attorney granted pursuant
to  Section  2.6.
    ------------

                                   ARTICLE XI

                        WITHDRAWAL OR REMOVAL OF PARTNERS

     Section  11.1     Withdrawal  of  the  General  Partner.
                       -------------------------------------

          (a)     The General Partner shall be deemed to have withdrawn from the
Partnership  upon  the  occurrence of any one of the following events (each such
event  herein  referred  to  as  an  "Event  of  Withdrawal");

               (i)     The  General  Partner  voluntarily  withdraws  from  the
Partnership by giving written notice to the other Partners;

               (ii)     The  General  Partner  transfers  all  of  its rights as
General  Partner  pursuant  to  Section  4.2;
                                ------------

               (iii)     The  General  Partner  is  removed  pursuant to Section
                                                                         -------
11.2;
----

               (iv)     The  General  Partner (A) makes a general assignment for
the  benefit  of creditors; (B) files a voluntary bankruptcy petition for relief
under  Chapter  7  of the United States Bankruptcy Code; (C) files a petition or
answer  seeking for itself a liquidation, dissolution or similar relief (but not
a reorganization) under any law; (D) files an answer or other pleading admitting
or  failing  to contest the material allegations of a petition filed against the
General Partner in a proceeding of the type described in clauses (A)-(C) of this
Section  11.1(a)(iv); or (E) seeks, consents to or acquiesces in the appointment
--------------------
of  a  trustee  (but  not a debtor-in-possession), receiver or liquidator of the
General  Partner  or  of  all  or  any  substantial  part  of  its  properties;

                                       41
<PAGE>
               (v)     A  final and non-appealable order of relief under Chapter
7  of  the  United States Bankruptcy Code is entered by a court with appropriate
jurisdiction  pursuant  to a voluntary or involuntary petition by or against the
General  Partner;  or

               (vi)     (A) in the event the General Partner is a corporation, a
certificate  of  dissolution or its equivalent is filed for the General Partner,
or  90 days expire after the date of notice to the General Partner of revocation
of  its  charter  without  a reinstatement of its charter, under the laws of its
state of incorporation; (B) in the event the General Partner is a partnership or
limited liability company, the dissolution and commencement of winding up of the
General Partner; (C) in the event the General Partner is acting in such capacity
by  virtue  of  being a trustee of a trust, the termination of the trust; (D) in
the  event the General Partner is a natural person, his death or adjudication of
incompetency;  and  (E) otherwise in the event of the termination of the General
Partner.  If  an  Event  of  Withdrawal specified in Section 11.1(a)(iv), (v) or
                                                     ---------------------------
(vi)(A),  (B),  (C)  or  (E)  occurs, the withdrawing General Partner shall give
----------------------------
notice  to  the  Limited  Partners  within  30  days  after such occurrence. The
Partners  hereby  agree  that  only  the  Events of Withdrawal described in this
Section  11.1  shall  result  in  the withdrawal of the General Partner from the
-------------
Partnership.

          (b)     Withdrawal  of  the  General Partner from the Partnership upon
the  occurrence  of an Event of Withdrawal shall not constitute a breach of this
Agreement  under  the following circumstances: (i) at any time during the period
beginning  on  the  Closing  Date and ending at 12:00 midnight, Eastern Time, on
October  31,  2008, the General Partner voluntarily withdraws by giving at least
90  days'  advance  notice of its intention to withdraw to the Limited Partners;
provided  that prior to the effective date of such withdrawal, the withdrawal is
approved  by  the  Limited  Partners  and  the  General  Partner delivers to the
Partnership  an  Opinion  of Counsel ("Withdrawal Opinion of Counsel") that such
withdrawal  (following the selection of the successor General Partner) would not
result  in  the  loss  of the limited liability of any Limited Partner or of the
limited partners of the MLP or cause the Partnership or the MLP to be treated as
an  association  taxable  as a corporation or otherwise to be taxed as an entity
for  federal income tax purposes (to the extent not previously treated as such);
(ii)  at  any  time  after 12:00 midnight, Eastern Standard Time, on October 31,
2008,  the  General  Partner  voluntarily  withdraws by giving at least 90 days'
advance  notice  to  the Limited Partners, such withdrawal to take effect on the
date specified in such notice; (iii) at any time that the General Partner ceases
to  be  the  General  Partner  pursuant  to Section 11.1(a)(ii) or (iii). If the
                                            ----------------------------
General  Partner  gives  a  notice  of withdrawal pursuant to Section 11.1(a)(i)
                                                              ------------------
hereof,  the  Limited  Partners  may,  prior  to  the  effective  date  of  such
withdrawal,  elect  a successor General Partner. If, prior to the effective date
of  the General Partner's withdrawal, a successor is not selected by the Limited
Partners  as  provided  herein  or the Partnership does not receive a Withdrawal
Opinion  of  Counsel,  the  Partnership  shall  be  dissolved in accordance with
Section 12.1. Any successor General Partner elected in accordance with the terms
------------
of  this  Section  11.1  shall  be  subject  to  the provisions of Section 10.3.
          -------------                                            ------------

     Section  11.2     Removal  of the General Partner.  The General Partner may
                       -------------------------------
be  removed  by the MLP. Upon the removal of the General Partner by the MLP, the
MLP  shall  elect a successor general partner for the Partnership. The admission
of any such successor General Partner to the Partnership shall be subject to the
provisions  of  Section  10.3.
                -------------

                                       42
<PAGE>
     Section  11.3     Interest  of  Departing  Partner.
                       --------------------------------

          (a)     The Partnership Interest of the Departing Partner departing as
a  result  of  withdrawal  or  removal pursuant to Section 11.1 or 11.2 shall be
                                                   --------------------
purchased  by the successor to the Departing Partner for an amount in cash equal
to  the  fair  market  value  of  such  Partnership  Interest, such amount to be
determined  and  payable  as  of  the  effective date of the Departing Partner's
departure.  Such  purchase  shall  be  a  condition  to  the  admission  to  the
Partnership  of  the  successor  as  the  General Partner. Any successor General
Partner shall indemnify the Departing Partner as to all debts and liabilities of
the  Partnership  arising  on  or  after the effective date of the withdrawal or
removal  of  the  Departing  Partner.

     For  purposes  of  this  Section  11.3(a),  the  fair  market  value of the
                              ----------------
Departing  Partner's  General  Partner Interest shall be determined by agreement
between  the Departing Partner and its successor or, failing agreement within 30
days  after  the  effective  date  of  such Departing Partner's departure, by an
independent  investment banking firm or other independent expert selected by the
Departing  Partner and its successor, which, in turn, may rely on other experts,
and  the  determination  of which shall be conclusive as to such matter. If such
parties  cannot  agree  upon  one  independent  investment banking firm or other
independent  expert  within  45 days after the effective date of such departure,
then  the  Departing  Partner  shall designate an independent investment banking
firm  or  other  independent  expert,  the  Departing  Partner's successor shall
designate  an  independent  investment banking firm or other independent expert,
and  such  firms or experts shall mutually select a third independent investment
banking  firm  or independent expert, which third independent investment banking
firm  or  other  independent expert shall determine the fair market value of the
General  Partner Interest of the Departing Partner. In making its determination,
such  third  independent investment banking firm or other independent expert may
consider  the  value  of the Partnership's assets, the rights and obligations of
the  Departing  Partner  and  other  factors  it  may  deem  relevant.

          (b)     The  Departing  Partner  shall  be  entitled  to  receive  all
reimbursements due such Departing Partner pursuant to Section 7.4, including any
                                                      -----------
employee-related  liabilities  (including  severance  liabilities),  incurred in
connection  with  the  termination  of  any employees employed by such Departing
Partner  for  the  benefit  of  the  Partnership.

     Section  11.4     Withdrawal  of  a  Limited  Partner.  Without  the  prior
                       -----------------------------------
written  consent of the General Partner, which may be granted or withheld in its
sole  discretion,  and  except  as  provided in Section 10.1, no Limited Partner
                                                ------------
shall  have  the  right  to  withdraw  from  the  Partnership.

                                   ARTICLE XII

                           DISSOLUTION AND LIQUIDATION

     Section  12.1     Dissolution.  The  Partnership  shall not be dissolved by
                       -----------
the  admission of Substituted Limited Partners or Additional Limited Partners or
by  the admission of a successor General Partner in accordance with the terms of
this  Agreement.  Upon  the  removal  or withdrawal of the General Partner, if a
successor  General  Partner  is  elected  pursuant  to Section 11.1 or 11.2, the
                                                       --------------------
Partnership  shall  not  be  dissolved  and such successor General Partner shall

                                       43
<PAGE>
continue  the  business  of the Partnership. The Partnership shall dissolve, and
(subject  to  Section  12.2)  its  affairs  shall  be  wound  up,  upon:
              -------------

          (a)     an  Event  of Withdrawal of the General Partner as provided in
Section  11.1(a) (other than Section 11.1(a)(ii)), unless a successor is elected
----------------             -------------------
and an Opinion of Counsel is received as provided in Section 11.1(b) or 11.2 and
                                                     -----------------------
such  successor  is  admitted  to  the  Partnership  pursuant  to  Section 10.4;
                                                                   ------------

          (b)     an election to dissolve the Partnership by the General Partner
that  is  approved  by  all  of  the  Limited  Partners;

          (c)     the  entry  of  a  decree  of  judicial  dissolution  of  the
Partnership  pursuant  to  the  provisions  of  the  Delaware  Act;

          (d)     the  sale  of  all  or  substantially  all  of  the assets and
properties  of  the  Partnership  Group;  or

          (e)     the  dissolution  of  the  MLP.

     Section  12.2     Continuation  of  the  Business  of the Partnership After
                       ---------------------------------------------------------
Dissolution.  Upon  dissolution  of  the  Partnership  following  an  Event  of
-----------
Withdrawal  caused  by  the  withdrawal  or  removal  of  the General Partner as
provided  in  Section  11.1(a)(i)  or  (iii)  and the failure of the Partners to
              ------------------------------
select  a  successor to such Departing Partner pursuant to Section 11.1 or 11.2,
    -                                                      --------------------
then  within  90  days  thereafter,  all  of  the  Limited Partners may elect to
reconstitute  the  Partnership  and  continue its business on the same terms and
conditions  set  forth in this Agreement by forming a new limited partnership on
terms  identical  to  those  set forth in this Agreement and having as a general
partner  a Person approved by a majority in interest of the Limited Partners. In
addition,  upon  dissolution  of the Partnership pursuant to Section 12.1(e), if
                                                             ---------------
the  MLP  is  reconstituted  pursuant  to Section 12.2 of the MLP Agreement, the
                                          ------------
reconstituted  MLP  may, within 180 days after such event of dissolution, acting
alone,  regardless  of  whether  there  are any other Limited Partners, elect to
reconstitute  the  Partnership  in  accordance  with  the  immediately preceding
sentence. Upon any such election by the Limited Partners or the MLP, as the case
may be, all Partners shall be bound thereby and shall be deemed to have approved
same.  Unless  such an election is made within the applicable time period as set
forth  above, the Partnership shall conduct only activities necessary to wind up
its  affairs.  If  such  an  election  is  so  made,  then:

          (a)     the  reconstituted  Partnership  shall continue unless earlier
dissolved  in  accordance  with  this  Article  XII;
                                       ------------

          (b)     if  the  successor  General  Partner is not the former General
Partner,  then  the interest of the former General Partner shall be purchased by
the  successor  General  Partner;  and

          (c)     all  necessary  steps  shall be taken to cancel this Agreement
and  the Certificate of Limited Partnership and to enter into and, as necessary,
to file, a new partnership agreement and certificate of limited partnership, and
the  successor  General  Partner  may  for  this  purpose exercise the powers of
attorney granted the General Partner pursuant to Section 2.6; provided, that the
                                                 -----------
right  to  approve  a  successor  General  Partner  and  to  reconstitute and to

                                       44
<PAGE>
continue  the  business  of  the  Partnership  shall  not  exist  and may not be
exercised unless the Partnership has received an Opinion of Counsel that (x) the
exercise  of  the right would not result in the loss of limited liability of the
Limited  Partners  or  any  limited  partner  of  the  MLP  and  (y) neither the
Partnership, the reconstituted limited partnership, the MLP nor any Group Member
would  be  treated  as  an  association taxable as a corporation or otherwise be
taxable  as  an entity for federal income tax purposes upon the exercise of such
right  to  continue.

     Section  12.3     Liquidator.  Upon  dissolution of the Partnership, unless
                       ----------
the  Partnership is continued under an election to reconstitute and continue the
Partnership  pursuant  to  Section 12.2, the General Partner shall select one or
                           ------------
more  Persons  to  act  as Liquidator. The Liquidator (if other than the General
Partner)  shall be entitled to receive such compensation for its services as may
be approved by a majority of the Limited Partners. The Liquidator (if other than
the  General  Partner)  shall  agree  not to resign at any time without 15 days'
prior notice and may be removed at any time, with or without cause, by notice of
removal  approved  by  a  majority  in  interest  of  the Limited Partners. Upon
dissolution,  removal  or  resignation  of  the  Liquidator,  a  successor  and
substitute  Liquidator  (who  shall  have  and succeed to all rights, powers and
duties  of  the original Liquidator) shall within 30 days thereafter be approved
by at least a majority in interest of the Limited Partners. The right to approve
a  successor  or  substitute  Liquidator  in the manner provided herein shall be
deemed  to refer also to any such successor or substitute Liquidator approved in
the  manner  herein  provided. Except as expressly provided in this Article XII,
                                                                    -----------
the  Liquidator  approved  in  the  manner  provided  herein  shall have and may
exercise, without further authorization or consent of any of the parties hereto,
all  of  the  powers  conferred upon the General Partner under the terms of this
Agreement  (but  subject  to  all of the applicable limitations, contractual and
otherwise,  upon  the exercise of such powers, other than the limitation on sale
set  forth  in  Section 7.3(b)) to the extent necessary or desirable in the good
                --------------
faith  judgment  of  the Liquidator to carry out the duties and functions of the
Liquidator  hereunder  for and during such period of time as shall be reasonably
required in the good faith judgment of the Liquidator to complete the winding up
and  liquidation  of  the  Partnership  as  provided  for  herein.

     Section  12.4     Liquidation.  The  Liquidator shall proceed to dispose of
                       -----------
the  assets of the Partnership, discharge its liabilities, and otherwise wind up
its  affairs in such manner and over such period as the Liquidator determines to
be  in  the  best  interest  of  the  Partners, subject to Section 17-804 of the
Delaware  Act  and  the  following:

          (a)     Disposition  of  Assets.  The  assets  may  be  disposed of by
                  -----------------------
public  or  private  sale  or by distribution in kind to one or more Partners on
such  terms  as  the  Liquidator  and such Partner or Partners may agree. If any
property  is  distributed  in  kind, the Partner receiving the property shall be
deemed  for  purposes of Section 12.4(c) to have received cash equal to its fair
                         ---------------
market  value;  and  contemporaneously therewith, appropriate cash distributions
must  be  made  to  the  other  Partners.  The  Liquidator  may, in its absolute
discretion,  defer liquidation or distribution of the Partnership's assets for a
reasonable  time  if it determines that an immediate sale or distribution of all
or  some  of  the Partnership's assets would be impractical or would cause undue
loss to the Partners. The Liquidator may, in its absolute discretion, distribute
the  Partnership's  assets, in whole or in part, in kind if it determines that a
sale would be impractical or would cause undue loss to the Partners.

                                       45
<PAGE>
          (b)     Discharge  of  Liabilities.  Liabilities  of  the  Partnership
                  --------------------------
include  amounts  owed  to  the  Liquidator  as compensation for serving in such
capacity  (subject  to  the  terms of Section 12.3) and amounts owed to Partners
                                      ------------
otherwise  than  in respect of their distribution rights under Article VI.  With
                                                               ----------
respect  to  any  liability  that  is contingent, conditional or unmatured or is
otherwise not yet due and payable, the Liquidator shall either settle such claim
for such amount as it thinks appropriate or establish a reserve of cash or other
assets  to provide for its payment. When paid, any unused portion of the reserve
shall  be  distributed  as  additional  liquidation  proceeds.

          (c)     Liquidation Distributions. All property and all cash in excess
                  -------------------------
of  that  required to discharge liabilities as provided in Section 12.4(b) shall
                                                           ---------------
be  distributed  to  the  Partners in accordance with, and to the extent of, the
positive  balances  in  their  respective  Capital Accounts, as determined after
taking  into  account  all Capital Account adjustments (other than those made by
reason  of  distributions pursuant to this Section 12.4(c)) for the taxable year
                                           ---------------
of  the Partnership during which the liquidation of the Partnership occurs (with
such date of occurrence being determined pursuant to Treasury Regulation Section
1.704-1(b)(2)(ii)(g)),  and  such  distribution shall be made by the end of such
taxable  year (or, if later, within 90 days after said date of such occurrence).

     Section  12.5     Cancellation of Certificate of Limited Partnership.  Upon
                       --------------------------------------------------
the  completion of the distribution of Partnership cash and property as provided
in  Section  12.4  in  connection  with  the liquidation of the Partnership, the
    -------------
Partnership  shall be terminated and the Certificate of Limited Partnership, and
all  qualifications  of  the  Partnership  as  a  foreign limited partnership in
jurisdictions other than the State of Delaware, shall be canceled and such other
actions as may be necessary to terminate the Partnership shall be taken.

     Section 12.6     Return of Contributions.  The General Partner shall not be
                      -----------------------
personally  liable  for,  and shall have no obligation to contribute or loan any
monies  or property to the Partnership to enable it to effectuate, the return of
the  Capital  Contributions  of the Limited Partners, or any portion thereof, it
being  expressly  understood  that  any  such  return  shall be made solely from
Partnership  assets.

     Section  12.7     Waiver  of Partition.  To the maximum extent permitted by
                       --------------------
law,  each  Partner  hereby  waives  any  right  to partition of the Partnership
property.

     Section  12.8     Capital  Account  Restoration.  No  Limited Partner shall
                       -----------------------------
have  any obligation to restore any negative balance in its Capital Account upon
liquidation  of  the  Partnership.  The  General  Partner  shall be obligated to
restore  any  negative  balance  in  its Capital Account upon liquidation of its
interest  in  the  Partnership by the end of the taxable year of the Partnership
during  which  such  liquidation  occurs, or, if later, within 90 days after the
date  of  such  liquidation.

                                       46
<PAGE>
                                  ARTICLE XIII

                       AMENDMENT OF PARTNERSHIP AGREEMENT

     Section  13.1     Amendment  to  be  Adopted Solely by the General Partner.
                       --------------------------------------------------------
Each  Partner  agrees  that  the  General  Partner,  without the approval of any
Partner  or  Assignee,  may  amend  any provision of this Agreement and execute,
swear  to,  acknowledge,  deliver,  file  and  record  whatever documents may be
required  in  connection  therewith,  to  reflect:

          (a)     a  change  in the name of the Partnership, the location of the
principal  place  of  business  of  the Partnership, the registered agent of the
Partnership  or  the  registered  office  of  the  Partnership;

          (b)     admission,  substitution, withdrawal or removal of Partners in
accordance  with  this  Agreement;

          (c)     a  change that, in the sole discretion of the General Partner,
is  necessary  or  advisable  to  qualify  or  continue the qualification of the
Partnership  as  a  limited  partnership  or  a partnership in which the Limited
Partners have limited liability under the laws of any state or to ensure that no
Group  Member  will  be  treated  as  an association taxable as a corporation or
otherwise  taxed  as  an  entity  for  federal  income  tax  purposes;

          (d)     a  change  that, in the discretion of the General Partner, (i)
does  not  adversely affect the Limited Partners (including any particular class
of  Partnership Interests as compared to other classes of Partnership Interests)
in  any  material  respect,  (ii)  is  necessary or advisable to (A) satisfy any
requirements,  conditions  or  guidelines  contained  in any opinion, directive,
order, ruling or regulation of any federal or state agency or judicial authority
or contained in any federal or state statute (including the Delaware Act) or (B)
facilitate  the  trading  of limited partner interests of the MLP (including the
division of any class or classes of outstanding limited partner interests of the
MLP  into  different classes to facilitate uniformity of tax consequences within
such  classes  of limited partner interests of the MLP) or comply with any rule,
regulation,  guideline  or  requirement  of  any National Securities Exchange on
which  such  limited  partner  interests  are  or  will  be  listed for trading,
compliance with any of which the General Partner determines in its discretion to
be  in  the best interests of the MLP and the limited partners of the MLP, (iii)
is  required to effect the intent expressed in the Registration Statement or the
intent  of the provisions of this Agreement or is otherwise contemplated by this
Agreement  or  (iv) is required to conform the provisions of this Agreement with
the  provisions  of the MLP Agreement as the provisions of the MLP Agreement may
be  amended,  supplemented  or  restated  from  time  to  time;

          (e)     a change in the fiscal year or taxable year of the Partnership
and any changes that, in the discretion of the General Partner, are necessary or
advisable  as  a  result  of  a change in the fiscal year or taxable year of the
Partnership  including,  if  the General Partner shall so determine, a change in
the  definition of "Quarter" and the dates on which distributions are to be made
by  the  Partnership;

                                       47
<PAGE>
          (f)     an  amendment that is necessary, in the Opinion of Counsel, to
prevent  the  Partnership,  or  the  General  Partner or its members, directors,
officers,  trustees  or  agents  from  in  any  manner  being  subjected  to the
provisions  of  the  Investment  Company Act of 1940, as amended, the Investment
Advisers  Act of 1940, as amended, or "plan asset" regulations adopted under the
Employee  Retirement  Income  Security  Act  of  1974, as amended, regardless of
whether  such  are  substantially  similar  to  plan asset regulations currently
applied  or  proposed  by  the  United  States  Department  of  Labor;

          (g)     any amendment expressly permitted in this Agreement to be made
by  the  General  Partner  acting  alone;

          (h)     an  amendment  effected,  necessitated  or  contemplated  by a
Merger  Agreement  approved  in  accordance  with  Section  14.3;
                                                   -------------

          (i)     an  amendment  that, in the discretion of the General Partner,
is  necessary  or  advisable to reflect, account for and deal with appropriately
the  formation  by  the Partnership of, or investment by the Partnership in, any
corporation,  partnership,  joint  venture,  limited  liability company or other
entity,  in  connection  with  the  conduct  by  the  Partnership  of activities
permitted  by  the  terms  of  Section  2.4;
                               ------------

          (j)     a  merger  or  conveyance  pursuant  to  Section  14.3(d);  or
                                                           ----------------

          (k)     any  other  amendments substantially similar to the foregoing.

     Section  13.2     Amendment  Procedures.  Except with respect to amendments
                       ---------------------
of the type described in Section 13.1, all amendments to this Agreement shall be
                         ------------
made in accordance with the following requirements: Amendments to this Agreement
may  be  proposed  only  by  or  with  the consent of the General Partner, which
consent  may  be  given or withheld in its sole discretion. A proposed amendment
shall  be  effective  upon  its  approval  by  the  Limited  Partners.

                                   ARTICLE XIV

                                     MERGER

     Section  14.1     Authority.  The Partnership may merge or consolidate with
                       ---------
one  or  more  corporations,  limited  liability  companies,  business trusts or
associations, real estate investment trusts, common law trusts or unincorporated
businesses, including a general partnership or limited partnership, formed under
the  laws  of  the  State of Delaware or any other state of the United States of
America,  pursuant  to  a  written agreement of merger or consolidation ("Merger
                                                                          ------
Agreement")  in  accordance  with  this  Article  XIV.
   ------                                ------------

     Section  14.2     Procedure  for  Merger  or  Consolidation.  Merger  or
                       -----------------------------------------
consolidation of the Partnership pursuant to this Article XIV requires the prior
                                                  -----------
approval  of the General Partner. If the General Partner shall determine, in the
exercise  of  its  discretion,  to  consent  to the merger or consolidation, the
General  Partner  shall  approve  the  Merger  Agreement, which shall set forth:

                                       48
<PAGE>
          (a)     the  names  and  jurisdictions of formation or organization of
each  of  the  business  entities  proposing  to  merge  or  consolidate;

          (b)     the  name and jurisdiction of formation or organization of the
business  entity  that  is  to survive the proposed merger or consolidation (the
"Surviving  Business  Entity");
 ---------------------------

          (c)     the  terms  and  conditions  of  the  proposed  merger  or
consolidation;

          (d)     the  manner  and  basis of exchanging or converting the equity
securities  of  each constituent business entity for, or into, cash, property or
general  or  limited partner interests, rights, securities or obligations of the
Surviving  Business Entity; and (i) if any general or limited partner interests,
securities  or rights of any constituent business entity are not to be exchanged
or  converted  solely for, or into, cash, property or general or limited partner
interests,  rights,  securities or obligations of the Surviving Business Entity,
the  cash,  property or general or limited partner interests, rights, securities
or  obligations  of  any limited partnership, corporation, trust or other entity
(other  than  the Surviving Business Entity) that the holders of such general or
limited  partner interests, securities or rights are to receive in exchange for,
or  upon conversion of their general or limited partner interests, securities or
rights, and (ii) in the case of securities represented by certificates, upon the
surrender  of  such  certificates,  which  cash,  property or general or limited
partner  interests,  rights, securities or obligations of the Surviving Business
Entity or any general or limited partnership, corporation, trust or other entity
(other  than  the  Surviving  Business  Entity), or evidences thereof, are to be
delivered;

          (e)     a statement of any changes in the constituent documents or the
adoption  of  new  constituent  documents  (the  articles  or  certificate  of
incorporation, articles of trust, declaration of trust, certificate or agreement
of  limited  partnership  or other similar charter or governing document) of the
Surviving  Business  Entity  to  be  effected  by  such merger or consolidation;

          (f)     the effective time of the merger, which may be the date of the
filing  of  the  certificate  of merger pursuant to Section 14.4 or a later date
                                                    ------------
specified  in or determinable in accordance with the Merger Agreement (provided,
that  if  the  effective  time of the merger is to be later than the date of the
filing  of the certificate of merger, the effective time shall be fixed no later
than  the  time  of the filing of the certificate of merger and stated therein);
and

          (g)     such  other  provisions with respect to the proposed merger or
consolidation  as  are  deemed  necessary or appropriate by the General Partner.

     Section  14.3     Approval  by Limited Partners of Merger or Consolidation.
                       --------------------------------------------------------

          (a)     Except  as  provided  in Section 14.3(d), the General Partner,
                                           ---------------
upon  its  approval  of  the  Merger  Agreement,  shall  direct  that the Merger
Agreement  be  submitted to a vote of the Limited Partners, whether at a special
meeting  or  by  written  consent,  in  either  case  in  accordance  with  the
requirements  of Article XIII. A copy or a summary of the Merger Agreement shall
                 ------------
be  included  in or enclosed with the notice of a special meeting or the written
consent.

                                       49
<PAGE>
          (b)     Except  as  provided  in Section 14.3(d), the Merger Agreement
                                           ---------------
shall  be approved upon receiving the affirmative vote or consent of the Limited
Partners.

          (c)     Except  as provided in Section 14.3(d), after such approval by
                                         ---------------
vote  or consent of the Limited Partners, and at any time prior to the filing of
the  certificate of merger pursuant to Section 14.4, the merger or consolidation
                                       ------------
may  be  abandoned  pursuant  to  provisions  therefor, if any, set forth in the
Merger  Agreement.

          (d)     Notwithstanding anything else contained in this Article XIV or
                                                                  -----------
in  this Agreement, the General Partner is permitted, in its discretion, without
Limited  Partner approval, to merge the Partnership or any Group Member into, or
convey all of the Partnership's assets to, another limited liability entity that
shall be newly formed and shall have no assets, liabilities or operations at the
time  of  such Merger other than those it receives from the Partnership or other
Group  Member if (i) the General Partner has received an Opinion of Counsel that
the  merger  or  conveyance, as the case may be, would not result in the loss of
the  limited  liability of any Limited Partner or any limited partner in the MLP
or cause the Partnership or the MLP to be treated as an association taxable as a
corporation  or  otherwise  to  be  taxed  as  an  entity for federal income tax
purposes  (to  the extent not previously treated as such), (ii) the sole purpose
of such merger or conveyance is to effect a mere change in the legal form of the
Partnership  into  another  limited  liability  entity  and  (iii) the governing
instruments  of  the  new  entity  provide  the Limited Partners and the General
Partner  with  substantially  the  same  rights  and  obligations  as are herein
contained.

     Section  14.4     Certificate of Merger.  Upon the required approval by the
                       ---------------------
General Partner and the Limited Partners of a Merger Agreement, a certificate of
merger  shall  be executed and filed with the Secretary of State of the State of
Delaware  in  conformity  with  the  requirements  of  the  Delaware  Act.

     Section  14.5     Effect  of  Merger.
                       ------------------

          (a)     At  the  effective  time  of  the  certificate  of  merger:

               (i)     all  of  the rights, privileges and powers of each of the
business  entities  that  has  merged  or  consolidated, and all property, real,
personal  and mixed, and all debts due to any of those business entities and all
other  things and causes of action belonging to each of those business entities,
shall  be  vested  in  the  Surviving  Business  Entity  and after the merger or
consolidation  shall  be  the  property  of the Surviving Business Entity to the
extent  they  were  of  each  constituent  business  entity;

               (ii)     the  title  to  any  real  property  vested  by  deed or
otherwise  in any of those constituent business entities shall not revert and is
not  in  any  way  impaired  because  of  the  merger  or  consolidation;

               (iii)     all  rights  of  creditors and all liens on or security
interests  in  property  of  any of those constituent business entities shall be
preserved  unimpaired;  and

                                       50
<PAGE>
               (iv)     all  debts,  liabilities and duties of those constituent
business  entities  shall  attach  to  the  Surviving Business Entity and may be
enforced  against  it to the same extent as if the debts, liabilities and duties
had  been  incurred  or  contracted  by  it.

          (b)     A  merger  or  consolidation effected pursuant to this Article
shall  not  be  deemed  to  result  in  a  transfer  or  assignment of assets or
liabilities  from  one  entity  to  another.

                                   ARTICLE XV

                               GENERAL PROVISIONS

     Section  15.1     Addresses  and  Notices.  Any  notice,  demand,  request,
                       -----------------------
report or proxy materials required or permitted to be given or made to a Partner
or  Assignee  under this Agreement shall be in writing and shall be deemed given
or  made when delivered in person or when sent by first class United States mail
or  by  other  means  of written communication to the Partner or Assignee at the
address appearing on the books and records of the Partnership. Any notice to the
Partnership  shall  be  deemed  given  if received by the General Partner at the
principal  office  of  the  Partnership designated pursuant to Section 2.3.  The
                                                               -----------
General  Partner  may  rely  and  shall be protected in relying on any notice or
other  document from a Partner, Assignee or other Person if believed by it to be
genuine.

     Section 15.2     Further Action.  The parties shall execute and deliver all
                      --------------
documents, provide all information and take or refrain from taking action as may
be necessary or appropriate to achieve the purposes of this Agreement.

     Section  15.3     Binding Effect.  This Agreement shall be binding upon and
                       --------------
inure  to  the  benefit  of  the  parties  hereto  and  their  heirs, executors,
administrators,  successors,  legal  representatives  and  permitted  assigns.

     Section  15.4     Integration.  This  Agreement  constitutes  the  entire
                       -----------
agreement  among  the parties hereto pertaining to the subject matter hereof and
supersedes  all  prior  agreements  and  understandings  pertaining  thereto.

     Section 15.5     Creditors.  None of the provisions of this Agreement shall
                      ---------
be  for  the  benefit  of,  or  shall  be  enforceable  by,  any creditor of the
Partnership.

     Section 15.6     Waiver.  No failure by any party to insist upon the strict
                      ------
performance  of  any covenant, duty, agreement or condition of this Agreement or
to  exercise  any  right  or  remedy  consequent  upon  a  breach  thereof shall
constitute  waiver  of  any  breach  of  any  other covenant, duty, agreement or
condition.

     Section  15.7     Counterparts.  This  Agreement  may  be  executed  in
                       ------------
counterparts, all of which together shall constitute an agreement binding on all
the parties hereto, notwithstanding that all such parties are not signatories to
the  original  or  the  same  counterpart. Each party shall become bound by this
Agreement  immediately  upon affixing its signature hereto, independently of the
signature  of  any  other  party.

                                       51
<PAGE>
     Section  15.8     Applicable  Law.  This  Agreement  shall  be construed in
                       ---------------
accordance  with  and  governed  by  the  laws of the State of Delaware, without
regard  to  the  principles  of  conflicts  of  law.

     Section  15.9     Invalidity  of  Provisions.  If  any  provision  of  this
                       --------------------------
Agreement  is  or  becomes invalid, illegal or unenforceable in any respect, the
validity,  legality  and  enforceability  of  the remaining provisions contained
herein  shall  not  be  affected  thereby.

     Section  15.10     Consent  of  Partners.  Each  Partner  hereby  expressly
                        ---------------------
consents  and  agrees  that,  whenever in this Agreement it is specified that an
action may be taken upon the affirmative vote or consent of less than all of the
Partners,  such  action may be so taken upon the concurrence of less than all of
the  Partners  and  each  Partner  shall be bound by the results of such action.

                  [Remainder of Page Intentionally Left Blank]

                                       52
<PAGE>
     IN  WITNESS  WHEREOF, the parties hereto have executed this Agreement as of
the  date  first  written  above.

                                          GENERAL PARTNER:

                                          RIO VISTA OPERATING GP LLC

                                          By:  Rio Vista Energy Partners, L.P.
                                               its Managing Member

                                               By:  Rio Vista GP LLC
                                               Its: General Partner

                                          By:  /s/ Richard Shore, Jr.
                                               -------------------------
                                                   Richard Shore, Jr.,
                                                   President

                                          LIMITED PARTNERS:

                                          PENN OCTANE CORPORATION

                                          By:  /s/ Richard Shore, Jr.
                                               -------------------------
                                                   Richard Shore, Jr.,
                                                   President

                                          UPON CONSUMMATION OF THE TRANSACTIONS
                                          CONTEMPLATED UNDER SECTION 5.2 OF THIS
                                          AGREEMENT:

                                          RIO VISTA ENERGY PARTNERS L.P.

                                          By: Rio Vista GP LLC
                                          Its General Partner

                                          By:  /s/ Richard Shore, Jr.
                                               -------------------------
                                                   Richard Shore, Jr.,
                                                   President

                                       53
<PAGE>Amended and Restated Line Letter
                        --------------------------------

                                                         September 15, 2004

Penn Octane Corporation
77-530 Enfield Lane
Building D
Palm Desert, CA  92211

Attention:  Mr. Jerome Richter

Gentlemen:

RZB FINANCE LLC ("RZB") and Penn Octane Corporation (the "Borrower") are parties
to  a  Line  Letter dated October 14, 1997 (as heretofore amended, the "Existing
Line  Letter").  The  Borrower  and RZB desire to amend and restate the Existing
Line  Letter.  Accordingly,  the  parties  hereto  agree  that the Existing Line
Letter  is  hereby amended and restated in its entirety as hereinafter set forth
in this Agreement (as amended, modified or supplemented from time to time, "this
Agreement"  or  "this  letter  agreement").  On  or  after the date hereof, when
counterparts  of  this Agreement shall have been executed by all parties hereto,
(a)  all  references to the "Agreement" and words of similar import in the other
Loan  Documents  shall be deemed to refer to the Existing Line Letter as amended
and  restated  hereby,  and  (b)  all outstanding loans and extensions of credit
under the Existing Line Letter shall be loans and extensions of credit under and
subject to the terms and conditions of this Agreement and the Loan Documents (as
hereinafter  defined).

          We  wish  to advise you of the terms and conditions upon which RZB may
in  its  sole  discretion  extend  credit  to  the  Borrower.

          1.   (a)  Subject  to  the provisions hereof, the Borrower may utilize
this  credit  facility  (the  "Credit  Facility") for demand loans ("Loans") and
issuance  of standby and commercial letters of credit ("L/C's") in the aggregate
principal  sum and face amount of up to Fifteen Million Dollars ($15,000,000) at
any one time outstanding.  Notwithstanding the foregoing, and without in any way
limiting  RZB's  sole  and  absolute discretion to determine whether to make any
Loan or issue any L/C, or refrain therefrom (as more fully set forth below), and
without  in  any way limiting RZB's absolute right to demand payment of any Loan
at  any  time or to change any of the Advance Rates (as hereinafter defined), at
any  time in RZB's sole discretion, the Borrower acknowledges that, with respect
to  each  specific  transaction of the Borrower financed by RZB pursuant hereto,
the  sum  of (i) the Loans made by RZB in connection with such transaction, (ii)
the aggregate face amount of L/Cs issued in connection therewith, plus (iii) the
aggregate  unreimbursed amount of all drawings under such L/Cs, shall not exceed
the  amount  obtained by applying the Advance Rates (the "Advance Rates") to the

                                      -1-
<PAGE>
value  of  the  assets of the Borrower being financed by RZB in such transaction
(as  such  value  may  be  determined  by  RZB  in  its  sole  discretion).

          Within  the  above  Credit  Facility, there shall be a sublimit not to
exceed  Three Million Dollars ($3,000,000) at any time outstanding available for
the issuance of standby letters of credit from time to time for the financing of
the  purchase  of  diesel  fuel and gasoline fuel.  The terms and beneficiary of
each  such  letter  of  credit  shall  be  subject to RZB's approval in its sole
discretion.  Prior  to the issuance of any standby letter of credit described in
clause  (i)  above,  the  Borrower  shall deposit cash collateral with RZB in an
amount  equal  to  15% of the maximum face amount of such letter of credit.  The
Borrower  hereby  grants  to  RZB  a  lien on and security interest in such cash
collateral  and  all  deposit  accounts  in  which  such cash collateral and all
proceeds  thereof  shall  be  maintained  as security for all present and future
obligations  of  the  Borrower  to  RZB until the letter of credit expires or is
terminated and all obligations in connection therewith shall have been satisfied
in full in cash to the sole and absolute satisfaction of RZB, provided, however,
that  no  lien on and security interest in cash collateral shall be released nor
shall any cash collateral be released if any Event of Default under any security
agreement delivered in connection with this Agreement shall have occurred and be
continuing  (an  "Event of Default") or any event that with the giving of notice
or lapse of time or both would constitute such an Event of Default (a "Default")
shall  have  occurred  and  be  continuing  or any demand for payment of or cash
collateral  for  the obligations of the Borrower under the Credit Facility shall
have  been  made.

          Within  the  above  Credit  Facility, there shall be a sublimit not to
exceed  Five  Hundred  Thousand  Dollars  ($500,000)  at  any  time  outstanding
available for the issuance of standby letters of credit from time to time (i) to
secure  a  performance  bond with respect to Arizona and Nevada excise taxes and
(ii)  in  favor of Kinder Morgan to secure monthly lease obligations.  The terms
and beneficiary of each such letter of credit shall be subject to RZB's approval
in  its  sole discretion.  Prior to the issuance of any standby letter of credit
described in this paragraph, the Borrower shall deposit cash collateral with RZB
in  an amount equal to 100% of the maximum face amount of such letter of credit.
The  Borrower  hereby grants to RZB a lien on and security interest in such cash
collateral  and  all  deposit  accounts  in  which  such cash collateral and all
proceeds  thereof  shall  be  maintained  as security for all present and future
obligations  of  the  Borrower  to  RZB until the letter of credit expires or is
terminated and all obligations in connection therewith shall have been satisfied
in full in cash to the sole and absolute satisfaction of RZB, provided, however,
that  no  lien on and security interest in cash collateral shall be released nor
shall  any  cash collateral be released if any Default or Event of Default shall
have  occurred and be continuing or any demand for payment of or cash collateral
for  the  obligations  of the Borrower under the Credit Facility shall have been
made.

               (b)  For  purposes  hereof:

                    "Advance Rates" shall mean, with respect to each transaction
of  the  Borrower  financed  by  RZB  pursuant  hereto, the following respective
percentages  of  the  Borrower's  accounts  receivable or inventory which is the
subject  of  such transaction (provided, however, that RZB reserves the right to
change  any  or  all  of  the  following  percentages  or

                                      -2-
<PAGE>
categories of assets in any way whatsoever, at its sole and absolute discretion,
at  any  time  and  from  time to time, with or without notice to the Borrower):

100%  of  CIF  cost  of  eligible inventory or 90% of the net face amount of the
Borrower's eligible accounts receivable (as such eligibility shall be determined
from  time  to  time  by  RZB in its sole and absolute discretion), whichever is
lower.

               (c)  The  Loans  shall  be evidenced by, and subject to the terms
and  conditions contained in, a single grid promissory note (the "Note") made by
the  Borrower  in form and substance satisfactory to RZB.  Interest on the Loans
shall  be  payable  at  the  rate  specified  in the Note (the "Interest Rate").

               (d)  Each  Loan  hereunder  shall be payable on demand, and in no
event  shall  any  Loan  be  outstanding  for  more  than  45  days.

               (e)  (i)   Each  L/C  shall be in form and substance satisfactory
to  RZB,  and, unless otherwise agreed by RZB, shall have an expiration date not
more  than  90  days  after  its  date  of  issuance.

                    (ii)  The  Borrower  shall  pay to RZB a fee with respect to
each  L/C  in  an amount equal to the greater of:  (1) a flat fee of $500, (2) a
fee  at  a  rate  per  annum equal to 2.5% of the maximum face amount of the L/C
(without  regard  to whether conditions to drawing may then be satisfied) or (3)
such  higher  amount  or  percentage  as  shall  be  agreed to in writing by the
Borrower  and  RZB with respect to L/Cs issued after the date of such agreement.
The  fee provided for in clauses (1), (2) and (3) shall be payable upon issuance
of  each L/C and, in the case of any L/C which as issued, amended or renewed has
an expiration date more than 90 days after its original date of issuance, on the
same  day in each calendar quarter thereafter if such L/C is outstanding on such
day.  After  any  such  fee  is  paid  it  shall  be  non-refundable.

               (f)  The  Borrower  shall  reimburse  RZB  for the amount of each
drawing  under  each  L/C  on demand, and shall pay interest on the unreimbursed
portion  of  each drawing as provided in the Continuing Agreement for Letters of
Credit  between  the  Borrower  and  RZB.

               (g)  This  credit  facility  may be terminated at any time at the
sole  and  absolute  discretion  of  RZB.

               (h)  Without  in  any  way  limiting  RZB's  sole  and  absolute
discretion  to  make  any  Loan  or issue any L/C, or refrain therefrom (as more
fully  set  forth  below), and without in any way limiting RZB's right to change
the  Advance  Rates  or  demand  payment of any Loan at any time in its sole and
absolute  discretion,  the Borrower agrees that it shall, from time to time, pay
the  Loans  and  reimbursement  obligations in respect of L/Cs and shall deliver
cash  collateral in respect of outstanding L/Cs, as and when necessary to cause:

the  sum  of  (1)  the  outstanding balance of all Loans, (2) the aggregate face
amount of all outstanding L/Cs, and (3) the aggregate unreimbursed amount of all
drawings  under  L/Cs  (as

                                      -3-
<PAGE>
such  sum may be reduced by the amount of cash collateral maintained with RZB or
a  bank  designated  by  RZB  and pledged in respect of outstanding L/Cs) not to
exceed,  on  any date, the amount obtained by applying the Advance Rates as then
in  effect  to  the  aggregate  value  as  of  such date (as such value shall be
determined by RZB in its sole discretion) of all of the assets then owned by the
Borrower  (without  double  counting)  which  are  the  subject  of transactions
financed  by  RZB  pursuant hereto and are subject to a perfected first priority
security  interest  in  favor  of  RZB.

               (i)   The  Borrower  shall  pay  to  RZB  a  non-refundable
administration  fee  of  $50,000  on  the  date  hereof  and  thereafter on each
anniversary  of  the  date  hereof.

          2.   The  proceeds of the Loans and the L/C's shall be used to finance
the  purchase of inventory, including, within the sublimits set forth in Section
1(a) above, diesel fuel and gasoline fuel, from suppliers which is to be sold to
purchasers  acceptable  to  RZB  in  its sole discretion and accounts receivable
arising  from  the sale of inventory and other transactions acceptable to RZB in
its  sole  discretion.

          3.   Requests  for Loans under this Agreement and directions as to the
disposition  of  the  proceeds  of Loans shall be given in writing (including by
telecopy)  by  the  Borrower  to  RZB,  or  may  be  given  orally (including by
telephone),  provided any such oral communication shall be confirmed promptly to
RZB  in  writing.  Requests  for  L/C's  under  this Agreement shall be given in
writing  (including  telecopy)  by  the  Borrower  to  RZB  by the execution and
delivery  of an application satisfactory in form and substance to RZB.  Any such
Loan  so  made or L/C issued shall be conclusively presumed to have been made to
or  for  the  benefit  of,  or  for  the  account  of, the Borrower when made in
accordance with any such request or direction.  RZB may rely on any such request
or direction which it believes to be genuine, including, without limitation, any
oral  request  whether  or  not  confirmed  in  writing,  and RZB shall be fully
protected  in  so  doing without any duty to make any further inquiry as to such
genuineness  or  to  otherwise  act  in  good  faith  in  the  premises.

          4.   THE  BORROWER  AGREES  AND  ACKNOWLEDGES  THAT,  NOTWITHSTANDING
ANYTHING  TO THE CONTRARY CONTAINED OR IMPLIED IN THIS AGREEMENT, RZB SHALL HAVE
NO OBLIGATION TO MAKE ANY LOAN OR ISSUE ANY L/C, AND RZB SHALL HAVE THE SOLE AND
ABSOLUTE DISCRETION TO MAKE ANY LOAN OR ISSUE ANY L/C OR REFRAIN FROM MAKING ANY
LOAN  OR  ISSUING  ANY  L/C.  THE BORROWER FURTHER AGREES AND ACKNOWLEDGES THAT,
NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED OR IMPLIED IN THIS AGREEMENT,
ALL  OF  THE LOANS SHALL BE PAYABLE ON DEMAND, AND RZB MAY DEMAND PAYMENT OF ANY
LOAN  AND/OR  MAY  DEMAND CASH COLLATERAL FOR ANY OUTSTANDING L/C AT ANY TIME IN
ITS  SOLE  AND  ABSOLUTE  DISCRETION.

          5.   All  payments of principal, interest and other sums in connection
with  the  Loans  and L/C's shall be payable to RZB at such account as RZB shall
designate,  or  in the absence of such designation, to RZB at its office at 1133
Avenue  of the Americas, New York, New York 10036, in lawful money of the United
States in immediately available funds and without setoff or deduction.  Interest
and  fees shall be computed on the basis of a 360 day year and the actual number
of  days  elapsed.  In  the  event  that  such  computation  would  result  in a

                                      -4-
<PAGE>
usurious  rate,  then  the interest or fee shall be recalculated on a 365 or 366
day  year,  as  the  case  may  be.

               All payments of principal, interest, and other sums in connection
with  this  letter  agreement,  the  Loans  and  L/C's  or  in  respect  of  any
participation  in  the  Credit Facility which may be sold in RZB's discretion to
any  participant  acceptable  to  RZB  (a  "Participant")  shall  be made by the
Borrower  to RZB or by RZB to the Participant, as applicable, free and clear of,
and  without deduction or withholding for, any and all present and future taxes,
levies,  duties  or withholdings of any kind or, if any deduction or withholding
from any amount payable hereunder or under any other Loan Document or in respect
of  the  participation of the Participant or in connection herewith or therewith
shall be legally required, such amount shall be increased by the Borrower as may
be  necessary  so  that  after  making  all  required deductions or withholdings
(including  deductions  or withholdings applicable to additional amounts payable
under  this paragraph 5) RZB or the Participant shall receive an amount equal to
the  amount  it  would have received had no such deductions or withholdings been
required. The Borrower shall pay to RZB promptly upon the Participant's request,
and  RZB  shall  promptly  pay  to  the  Participant,  any amount payable to the
Participant  pursuant to the preceding sentence, but RZB shall have no liability
under  this paragraph to the Participant for any amount which is not received by
RZB  from  the  Borrower.

          6.   Without  limiting the discretionary nature of the credit facility
hereunder, the making of each Loan and the issuance of each L/C shall be subject
to  the  fulfillment  (to  the  satisfaction of RZB) of the following conditions
precedent, provided that all of the following conditions precedent to the extent
           --------
relating  to RVEP and the Operating Partnership shall be waived by RZB until RZB
withdraws  such  waiver  and  gives  notice of such withdrawal to the Borrower :

               (a)  The  Borrower  shall  have executed and delivered to RZB the
Note(s) evidencing the Loans and a Continuing Agreement for Letters of Credit in
form  and  substance  satisfactory  to  RZB;

               (b)  The  Borrower,  Rio  Vista Energy Partners L.P. ("RVEP") and
Rio  Vista  Operating  Partnership  L.P.  (the  "Operating  Partnership")  (the
Borrower, RVEP and the Operating Partnership are collectively referred to as the
"Loan  Parties")  shall have delivered to RZB such documents of title, and other
instruments  and  documents, pertaining to the transaction of the Borrower which
is being financed in connection with such Loan or L/C, as RZB shall require, and
all  of  the  foregoing  shall  be  in  form  and  substance,  and  contain such
endorsements,  as  shall  be  satisfactory  to  RZB  in  all  respects;

               (c)  Each  Loan  Party  shall  have complied and shall then be in
compliance with all of the terms, covenants and conditions of this Agreement and
the  Loan  Documents  (as  hereinafter  defined  in  Section  11(c));

               (d)  The  representations  and  warranties  of  the  Loan Parties
contained in each of the Loan Documents shall be true and correct on the date of
such  Loan  or  L/C;

                                      -5-
<PAGE>
               (e)  RZB's  continuing review of and continuing satisfaction with
the  business,  operations,  prospects,  properties, and condition, financial or
otherwise,  of  each  of  the  Loan  Parties;

               (f)  RZB  shall  have  received  (i)  a copy of all corporate and
partnership  action,  as  the  case may be, taken by each of the Loan Parties to
authorize  the  execution  and  delivery  of  the  agreements,  instruments  and
documents  pursuant  hereto  or in connection herewith, and (ii) if requested by
RZB, a legal opinion of counsel to the Loan Parties, together with such opinions
of  special  counsel  to  the  Loan  Parties as RZB shall request, and each such
opinion  shall  be  satisfactory  in  form  and  substance  to  RZB;

               (g)  RZB  shall have received the unlimited personal guarantee by
Mr.  Jerome  Richter  of payment of the obligations of the Borrower, in form and
substance  satisfactory  to  RZB,  and  the  personal financial statement of Mr.
Richter  in  form  and  substance  satisfactory  to  RZB;

               (h)  RZB  shall have received the unlimited guarantees by each of
RVEP  and  the  Operating  Partnership  of  payment  of  the  obligations of the
Borrower,  in  form  and  substance  satisfactory  to  RZB;

               (i)  (A)  Each  of  the  Loan  Parties  shall  have  executed and
delivered  to  RZB  a  general  security agreement granting RZB a first priority
perfected  lien  on  the  Collateral  (as defined therein) in form and substance
satisfactory  to  RZB;  and

                    (B)  RZB  shall  have  obtained  from  the Loan Parties duly
executed  Security  Agreement Questionnaires and such lien search reports as RZB
shall  request,  all  to  be  in  form  and  substance  satisfactory to RZB; and

                    (C)  RZB shall have filed such UCC financing statements with
respect  to  the  Loan  Parties  in  such  jurisdictions  as  RZB shall request;

               (j)  (A)  The  Borrower  and the Operating Partnership shall have
executed  and  delivered  to  RZB  amendments  or  supplements  to  the existing
Mortgages,  Deeds  of  Trust  and Security Agreements previously executed by the
Borrower, which shall be in form and substance satisfactory to RZB, granting RZB
a  first  priority  mortgage  lien and deed of trust on the collateral described
therein,  including  without  limitation, the terminal in Brownsville, Texas and
all  pipelines  and  evidencing  the  assumption  thereof  by  the  Operating
Partnership;  and

                    (B)  Such  amendments  or  supplements  shall have been duly
filed  and  recorded  in  all  filing  offices  deemed  necessary  by  RZB;

               (k)  The  Loan  Parties shall have executed and/or delivered such
agreements,  instruments  and documents, including, without limitation, consents
of  third  parties and lessor, titles insurance policy endorsements and searches
and surveys, as RZB shall request in connection with the Security Agreements and
amendments  or  supplements  referred to in the two preceding paragraphs (i) and
(j);

                                      -6-
<PAGE>
               (l)  The Operating Partnership shall have delivered to RZB copies
of  notices  to  its  account  debtors (including without limitation PMI Trading
Limited  and  its  affiliates), duly executed by such account debtors, directing
that  payment  be  made  directly  to  RZB;

               (m)  The  Loan  Parties  shall  have  delivered  such evidence of
insurance  and  loss  payable  endorsements  as  RZB  may  require;

               (n)  The Loan Parties shall have delivered copies of all of their
supply  and  sales  contracts having a term exceeding 30 days, certified as true
and  complete  by  a  senior  officer;

               (o)  The  Loan Parties shall have instituted lockbox arrangements
satisfactory  to  RZB  in  its  sole  discretion;

               (p)  The  Borrower  shall have delivered to RZB copies, certified
as  true  and complete, of all agreements, instruments and documents, including,
without  limitation,  all  registrations and filings with and notices to the SEC
and  any  other  governmental  authority,  relating  to  the  establishment,
capitalization, operation, administration and management of the Loan Parties and
their  affiliates  and  the transfer by the Borrower of any or all of its assets
and  business  to  any Loan Party or affiliate thereof, and all of the foregoing
shall  be  satisfactory  in  form  and  substance  to  RZB;

               (q)  All  legal  matters  incident  to  such Loan or L/C shall be
reasonably  satisfactory  to  counsel  to  RZB.

          7.   As  long  as  any  of the Loans or L/C's or any other obligations
hereunder  shall  be  outstanding,  the Borrower shall comply with the following
covenants,  provided  that  until  RZB  notifies  the  Borrower  in writing, the
covenants  shall  not  apply  to  RVEP  or  the  Operating  Partnership:

               (a)  Furnish  to RZB within 120 days after the end of each fiscal
year  a  copy  of  the  audited  financial  statements  of the Borrower and RVEP
prepared  in  conformity  with  generally  accepted  accounting  principles
consistently  applied  and  certified without qualification by the relevant Loan
Party's  independent  public  accountants.

               (b)  Furnish  to  RZB, each certified as true and complete in all
respects  by the Borrower's chief financial officer or the person acting in such
capacity,  (i) on a quarterly basis not later than 60 days after the end of each
quarter, a copy of the financial statements of each Loan Party for the preceding
quarter; (ii) on a weekly basis or more frequently if required by RZB, each Loan
Party's  current  inventory  report,  and  on  a  daily basis, each Loan Party's
loading rack tickets evidencing delivery of the commodity and resulting accounts
receivable  which  are  the  subject of any underlying financing; and (iii) on a
monthly  basis  not later than 30 days after the end of each month, a profit and
loss  statement  of  each  Loan  Party.

                                      -7-
<PAGE>
               (c)  Furnish,  to RZB such other information concerning each Loan
Party's  business,  properties, condition or operations, financial or otherwise,
as  RZB may from time to time reasonably request and copies of all reports filed
with  the  Securities  and  Exchange  Commission  from  time  to  time.

               (d)  Maintain  and  preserve,  and cause each other Loan Party to
maintain  and preserve, its corporate existence, and remain in the same lines of
business  as  on  the  date  hereof.

               (e)  Except  as  set  forth on Schedule 7(e) hereto, the Borrower
shall  not,  and  shall  cause  each  other Loan Party not to, create, assume or
permit  to  exist  any  lien,  security  interest,  mortgage,  charge  or  other
encumbrance of any nature whatsoever on any of its properties or assets, whether
now  owned  or  hereafter  acquired,  except  in  favor  of  RZB.

               (f)  The  Borrower  shall cause Rio Vista on a consolidated basis
and  the  Operating Partnership to maintain an excess of total assets over total
liabilities  as  determined  in  accordance  with  generally accepted accounting
principles  of  at  least  $9,000,000  at  all  times.

               (g)  The  Borrower shall not, and shall cause each Loan Party not
to,  declare  or  make at any time any dividend payment or other distribution of
assets,  properties,  cash,  rights, obligations or securities on account of any
shares  of any class of capital stock of the Borrower or such Loan Party, as the
case  may  be, or its partnership interests or other equity, or purchase, redeem
or  otherwise acquire for value (or permit any of its subsidiaries to do so) any
shares  of  any  class  of  capital  stock or the partnership interests or other
equity  of  the  Borrower  or  such other Loan Party, as the case may be, or any
warrants,  rights  or  options  to acquire such shares, partnership interests or
other  equity now or hereafter outstanding, without the prior written consent of
RZB  unless, before and after giving effect to the payment of any such dividends
or  distributions,  such  Loan Party shall be in compliance with all obligations
and  covenants  contained  in this agreement and the other Loan Documents and no
Default or Event of Default shall have occurred and be continuing.  The Borrower
shall  deliver  to RZB a certificate from the Borrower's chief financial officer
or  the  person  acting  in  such  capacity  on  the earlier of the date of each
delivery of the quarterly financial statements under Section 7(b) hereof and the
date  such  quarterly financial statements are required to be delivered, setting
forth  the  amount  of  all  dividends and distributions paid by each Loan Party
during  the  immediately  preceding  fiscal quarter, together with a calculation
with  respect thereto showing compliance with the covenant in this Section 7(g).

          8. Notwithstanding anything to the contrary contained herein or in any
other Loan Document, including without limitation the General Security Agreement
dated  October  17,  1997  between the Borrower and RZB and the General Security
Agreement  between  the  Operating  Partnership  and  RZB:

               (a)  Provided that no Event of Default under any Loan Document
shall have occurred and be continuing, no event that with the giving of notice
or lapse of time or both would constitute such an Event of Default shall have
occurred and be continuing and no demand for payment of any obligations of the
Borrower shall have been made by RZB, RZB shall, upon

                                      -8-
<PAGE>
request of the Borrower, execute and deliver an agreement reasonably
satisfactory to RZB subordinating RZB's mortgage lien and security interest on
the land, buildings and fixtures (but no other assets contained thereon or
therein) constituting (x) the Borrower's terminal in Brownsville, Texas and (y)
the Borrower's pipeline, to any mortgage lien and security interest of a third
party unaffiliated with the Borrower (the "New Lender") which secures financing
provided by the New Lender to the Borrower after the date hereof.  Such
agreement shall contain a covenant by the New Lender to transport at no cost to
RZB from such terminal and/or through such pipeline all inventory of the
Borrower or the Operating Partnership financed by RZB.  The foregoing is not a
consent by RZB to any additional financing or indebtedness of the Borrower.

               (b)  In the event the Borrower intends to obtain additional
financing or incur additional indebtedness, the Borrower shall notify RZB and
request RZB's consent.  RZB agrees to consider such request, but the Borrower
expressly acknowledges and agrees that: (x) RZB shall have sole discretion to
grant or deny such consent or impose conditions on the grant of such consent and
(y) RZB has not committed or agreed to grant such consent, and such consent
shall be effective only if in writing and executed by RZB.

          9.   The  Borrower  represents  and  warrants to RZB and covenants and
agrees  with  RZB  that, with respect to each account receivable of the Borrower
and  any other Loan Party financed by RZB pursuant hereto, there is not nor will
there  be  at  any  time,  any  counterclaim,  dispute  or  any  other matter or
circumstance  whatsoever  which  could  give rise to a right of set-off or other
adverse  claim  that  could  be  asserted  by  the  account debtor to reduce its
obligation  to  pay  under  such  account  receivable.

          10.  The  Borrower  represents  and  warrants to RZB and covenants and
agrees with RZB that the business of RVEP is and shall be solely to be a holding
company  whose  sole  assets  are  and  shall  be its interests in the Operating
Partnership.

          11.  (a)  No  delay  on  the  part  of  RZB  in  exercising any of its
options,  powers  or rights, or partial or single exercise thereof, irrespective
of  any  course  of  dealing,  shall  constitute a waiver thereof.  The options,
powers and rights of RZB specified in the Loan Documents (as hereinafter defined
in Section 11(c)) are in addition to those otherwise created by law or under any
other  agreement  between any Loan Party and RZB.  No amendment, modification or
waiver of any provision of any Loan Document to which any Loan Party is a party,
nor  consent  to  any departure by any Loan Party therefrom, shall be effective,
unless  the  same  shall  be  in  writing and signed by RZB.  Any such waiver or
consent shall be effective only in the specific instance and for the purpose for
which  given.  No  consent  to or demand on any Loan Party in any case shall, of
itself,  entitle it to any other or further notice or demand in similar or other
circumstances.

               (b)  This  Agreement  and  the  other  Loan  Documents embody the
entire  agreement  and  understanding between RZB and Loan Parties and supersede
all  prior  agreements and understandings relating to the subject matter hereof.
THIS  WRITTEN  AGREEMENT  (AND  THE  OTHER  LOAN DOCUMENTS) REPRESENTS THE FINAL
AGREEMENT  AMONG  THE  PARTIES HERETO AND THE OTHER LOAN PARTIES WITH RESPECT TO

                                      -9-
<PAGE>
THE  MATTERS  COVERED HEREBY AND THEREBY AND MAY NOT BE CONTRADICTED BY EVIDENCE
OF  PRIOR,  CONTEMPORANEOUS  OR  SUBSEQUENT  ORAL  AGREEMENTS  OF  THE  PARTIES.

               (c)  The  Borrower  agrees to pay all costs and expenses incurred
or  payable  by  RZB  and  the  Participant  in connection with the preparation,
administration, interpretation, enforcement or collection of this Agreement, the
Note,  any  Participation  Agreement between RZB and the Participant (as amended
from  time  to  time,  the  "Participation  Agreement"),  the  L/C's  and  any
applications  or  other  agreements  pertaining  to  the  issuance  thereof, the
security  agreements  with  and guarantees from the Loan Parties, the mortgages,
and  amendments  and  supplements  referred  to  herein, and all other documents
executed  and delivered in connection herewith or therewith (such agreements and
documents,  including all amendments, modifications and supplements of or to all
such  agreements  and documents are herein referred to as the "Loan Documents"),
including,  without  limitation,  costs  of  examination  and  audit of the Loan
Parties'  books and records and of the collateral security for the Loans and L/C
reimbursement  obligations,  and  court costs and reasonable attorneys' fees and
disbursements.

               (d)  (i)   If  RZB  or the Participant shall have determined that
the  applicability  of  any  law,  rule,  regulation  or  guideline (domestic or
foreign)  adopted  (whether  before  or  after  the  date hereof) pursuant to or
arising  out  of  the  July  1988  report  of  the  Basle  Committee  on Banking
Regulations  and  Supervisory  Practices  entitled "International Convergence of
Capital  Measurement  and  Capital  Standards",  or  the adoption after the date
hereof  of  any  other  law, rule, regulation or guideline (domestic or foreign)
regarding  capital  adequacy,  or  any  change in any of the foregoing or in the
enforcement  or  interpretation or administration of any of the foregoing by any
court  or  any governmental authority, central bank or comparable agency charged
with  the enforcement or interpretation or administration thereof, or compliance
by  RZB  or the Participant or any corporation or other entity which directly or
indirectly  controls  RZB  or  the  Participant  (each such corporation or other
entity  is  hereinafter  referred  to as a "Controlling Person") (or any lending
office of RZB or the Participant or any Controlling Person), with any request or
directive regarding capital adequacy (whether or not having the force of law) of
any  such court, authority, central bank or comparable agency, has or would have
the  effect of reducing the rate of return on RZB's or the Participant's (as the
case  may  be)  capital  or on the capital of a Controlling Person, if any, as a
consequence  of  its  issuance  or maintenance of any L/C or its obligations (if
any)  under  this Agreement or the Participation Agreement to a level below that
which  RZB or the Participant or such Controlling Person could have achieved but
for  such  applicability,  adoption,  change  or  compliance  (taking  into
consideration  RZB's  or the Participant's (as the case may be) policies and the
policies  of  such  Controlling  Person  with respect to capital adequacy) by an
amount deemed by RZB or the Participant to be material, then, upon demand by RZB
                                                        ----
or the Participant, the Borrower shall pay to RZB from time to time as specified
by  RZB  or the Participant such additional amount or amounts as will compensate
RZB  or  the  Participant  or  such  Controlling  Person  for any such reduction
suffered.  Any  such  amount  paid  to  RZB  relating  to  the  Participant or a
Controlling  Person  of  the  Participant  shall  be promptly paid by RZB to the
Participant  pursuant  to  the  Participation  Agreement  between  them.

                                      -10-
<PAGE>
                    (ii)  If  any  change  in law, rule, regulation or guideline
(domestic  or  foreign)  or in the enforcement, interpretation or administration
thereof  by  any court or any governmental authority, central bank or comparable
agency  charged  with  the interpretation or administration thereof shall at any
time  (A)  impose,  modify  or  deem  applicable any reserve, special deposit or
similar  requirement (including, without limitation, pursuant to Regulation D of
the  Board of Governors of the Federal Reserve System) against letters of credit
issued  by  RZB  or  participations  therein purchased by the Participant or (B)
subject  letters  of credit issued by RZB or participations therein purchased by
the  Participant  to any assessment or other cost imposed by the Federal Deposit
Insurance  Corporation  or  any  successor  thereto  or (C) impose on RZB or the
Participant  any  other or similar condition regarding this Agreement or any L/C
or the Participation Agreement, the obligations (if any) of RZB hereunder or the
obligations  of the Participant under the Participation Agreement and the result
of  any  event  referred to in clause (A), (B) or (C) above shall be to increase
the  cost to RZB or the Participant of agreeing to issue, issuing or maintaining
or  confirming any L/C or making, funding or maintaining (or agreeing to fund or
maintain) drawings under any L/C or of participating in any L/C or to reduce any
accounts  receivable  by  RZB or the Participant hereunder or by the Participant
under  the  Participation  Agreement  by  an amount which RZB or the Participant
shall  deem  to  be  material  (which increase in cost or reduction shall be the
result  of  the reasonable allocation by RZB or the Participant of the aggregate
of  such  cost  increases  or reductions resulting from such events), then, upon
                                                                      ----
demand  by  RZB  or  the Participant, the Borrower shall pay to RZB from time to
time  as  specified  by  RZB  or  the  Participant  (as  the  case may be), such
additional  amount  or amounts as will compensate RZB or the Participant (as the
case  may  be)  for  such increased cost from the date of such change.  Any such
amount  paid to RZB relating to the Participant shall be promptly paid by RZB to
the  Participant  pursuant  to  the  Participation  Agreement between them.  The
Borrower's  obligation  to  pay  compensation  contained in this subsection (ii)
shall  be  applicable  as  well  to  any  amount RZB may be obligated to pay any
financial  institution  which confirms or advises any L/C and which incurs or is
subjected  to  any increased cost or reduction of amounts receivable as a result
of  the  imposition,  modification or applicability of any such reserve, special
deposit  or  similar requirement, the subjecting of L/C's to any such assessment
or  other  cost,  or  the  imposition  of  any  such other or similar condition.

                    (iii) The  provisions  of  this subsection (d) shall survive
the  termination  of  this  Agreement.

                    (iv)  RZB  or  the  Participant  shall  notify  the Borrower
within  3  months  after it becomes aware of its right to claim any amount under
paragraphs  (d)(i)  or  (ii) above, provided that (A) if such lender fails to so
                                    --------
notify  the  Borrower  within  such  3  month  period,  such lender shall not be
entitled  to  claim  any  additional amounts pursuant to this subsection for any
period ending on a date which is prior to 3 months before such notification plus
any  additional  period  of  retroactive  effect of the law, rule, regulation or
guideline referred to in paragraph (d)(i) or (ii) above, and (B) neither RZB nor
the  Participant  shall  have  any  right to assert a claim for any amount under
paragraphs (d)(i) or (ii) after the date which is 3 months after payment in full
of  all  Loans,  obligations in respect of L/C's and other obligations hereunder
and  the  termination  of  this  Agreement.

                                      -11-
<PAGE>
               (e)  The  Loan  Documents  to  which  the  Borrower  and the Loan
Parties  are  a  party shall be binding on the Borrower and the Loan Parties and
their  respective  successors and assigns, and shall inure to the benefit of RZB
and  its  successors  and assigns, provided that the Borrower shall not have the
right  to  assign  its  rights hereunder or thereunder or any interest herein or
therein  without  RZB's  prior  written  consent.

               (f)  In  addition  to the rights granted to it by applicable law,
RZB has the right to set-off and apply to any of the Borrower's and Loan Parties
obligations hereunder and under the Loan Documents any amount received by it for
the  Borrower or any of the Loan Parties.  The Participant shall have a right of
set-off  and  banker's lien to the same extent as if its participation under the
Participation  Agreement  were  a  direct  loan  to  the  Borrower.

               (g)  THIS  AGREEMENT  SHALL  BE  CONSTRUED IN ACCORDANCE WITH AND
GOVERNED  BY  THE  LAW OF THE STATE OF NEW YORK (WITHOUT REGARD TO PRINCIPLES OF
CONFLICTS  OF  LAW).

                    CONTRARY  TO  THE  EXPRESS  AGREEMENT OF THE PARTIES IN THIS
SECTION  11(G)  HEREOF,  IF THE LAWS OF ANY STATE OTHER THAN NEW YORK, INCLUDING
THE  LAWS  OF  THE  STATE OF TEXAS, SHALL BE DETERMINED TO BE APPLICABLE TO THIS
AGREEMENT, THE NOTE OR THE OTHER LOAN DOCUMENTS, IT IS THE INTENT OF THE PARTIES
HERETO  TO  COMPLY  WITH  ALL  APPLICABLE  USURY  LAWS AND TO LIMIT ALL INTEREST
CONTRACTED  FOR,  RESERVED,  CHARGED OR RECEIVED UNDER THE LOAN DOCUMENTS TO THE
MAXIMUM  NONUSURIOUS  RATE  OF  INTEREST  PERMITTED  BY  APPLICABLE LAW.  IF THE
APPLICABLE  COMMON  LAW  AND  PRINCIPLES  OF EQUITY AND CONSTITUTIONS, STATUTES,
RULES,  REGULATIONS  AND  ORDERS  OF  GOVERNMENTAL  BODIES  AND AUTHORITIES, AND
ORDERS, WRITS, DECISIONS, INJUNCTIONS AND DECREES OF ALL COURTS, ARBITRATORS AND
GOVERNMENTAL  INSTRUMENTALITIES  (THE  "APPLICABLE  LAW")  IS  EVER  JUDICIALLY
INTERPRETED  SO  AS  TO  RENDER  USURIOUS  ANY  AMOUNT  CALLED  FOR  UNDER OR IN
CONNECTION  WITH THE NOTES, THIS AGREEMENT AND THE LOAN DOCUMENTS, OR CONTRACTED
FOR,  CHARGED,  TAKEN,  RESERVED  OR  RECEIVED  WITH RESPECT TO THE TRANSACTIONS
REFERRED  TO  HEREIN OR THEREIN, OR IF DEMAND OF OR ACCELERATION OF THE MATURITY
OF  THE NOTE OR IF ANY PREPAYMENT BY BORROWER OR ANY OF THE LOAN PARTIES RESULTS
IN  BORROWER  OR  LOAN  PARTIES  OR  ANY  OTHER  PERSON HAVING PAID ANY INTEREST
(HOWEVER  DENOMINATED)  IN EXCESS OF THAT PERMITTED BY LAW FOR THE ACTUAL PERIOD
THE  NOTE  AND  THE  OBLIGATIONS  OF  THE  BORROWER  AND  THE  LOAN  PARTIES ARE
OUTSTANDING,  THEN IT IS THE BORROWER'S, THE LOAN PARTIES' AND RZB'S INTENT THAT
ALL  EXCESS  AMOUNTS  THERETOFORE  RECEIVED  BY  RZB  SHALL  BE  CREDITED ON THE
PRINCIPAL BALANCE OF THE NOTE (OR, IF THE NOTE HAS BEEN OR WOULD THEREBY BE PAID
IN  FULL,  REFUNDED  TO THE BORROWER OR THE LOAN PARTIES), AND THE PROVISIONS OF
THE NOTE AND THIS AGREEMENT IMMEDIATELY SHALL BE DEEMED REFORMED AND THE AMOUNTS
THEREAFTER  COLLECTIBLE  UNDER  THE  NOTE,  THIS  AGREEMENT  AND  THE OTHER LOAN
DOCUMENTS  REDUCED, WITHOUT THE NECESSITY OF THE EXECUTION OF ANY NEW DOCUMENTS,
SO AS TO COMPLY WITH THE APPLICABLE LAW, BUT SO AS TO PERMIT THE RECOVERY OF THE
FULLEST AMOUNT OTHERWISE CALLED FOR UNDER THE NOTE, THIS AGREEMENT AND THE OTHER
LOAN  DOCUMENTS  FOR  THE  ACTUAL  PERIOD  THE NOTE AND OTHER OBLIGATIONS OF THE
BORROWER  AND  THE  LOAN  PARTIES  ARE  OUTSTANDING.

               (h)  THE  BORROWER  AND  THE  LOAN  PARTIES HEREBY AGREE THAT ANY
LEGAL  ACTION  OR PROCEEDING AGAINST THE BORROWER OR ANY LOAN PARTY WITH RESPECT
TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE
STATE  OF  NEW  YORK

                                      -12-
<PAGE>
IN  THE  CITY  OF  NEW  YORK OR OF THE UNITED STATES OF AMERICA FOR THE SOUTHERN
DISTRICT  OF  NEW  YORK AS RZB MAY ELECT, AND, BY EXECUTION AND DELIVERY HEREOF,
EACH  OF THE BORROWER AND THE LOAN PARTIES ACCEPT AND CONSENT TO, FOR ITSELF AND
IN  RESPECT  TO ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF
THE  AFORESAID  COURTS  AND  AGREES  THAT  SUCH JURISDICTION SHALL BE EXCLUSIVE,
UNLESS WAIVED BY RZB IN WRITING, WITH RESPECT TO ANY ACTION, CLAIM OR PROCEEDING
BROUGHT  BY  IT AGAINST RZB AND ANY QUESTIONS RELATING TO USURY.  NOTHING HEREIN
SHALL  LIMIT  THE RIGHT OF RZB TO BRING PROCEEDINGS AGAINST THE BORROWER AND THE
LOAN PARTIES IN THE COURTS OF ANY OTHER JURISDICTION.  THE BORROWER AND THE LOAN
PARTIES  AGREE THAT SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF
THE  STATE  OF NEW YORK SHALL APPLY TO THIS AGREEMENT AND, TO THE MAXIMUM EXTENT
PERMITTED  BY  LAW,  WAIVES  ANY  RIGHT  TO  STAY  OR  TO  DISMISS ANY ACTION OR
PROCEEDING  BROUGHT  BEFORE  SAID  COURTS  ON THE BASIS OF FORUM NON CONVENIENS.
                                                           ----- --- ----------

               (i)  AFTER  REVIEWING  THIS  PROVISION  SPECIFICALLY  WITH  ITS
RESPECTIVE  COUNSEL,  EACH  OF  THE  BORROWER,  THE  LOAN PARTIES AND RZB HEREBY
KNOWINGLY,  VOLUNTARILY  AND INTENTIONALLY WAIVES ANY AND ALL RIGHTS IT MAY HAVE
TO  A  TRIAL  BY  JURY IN RESPECT OF ANY LITIGATION BASED ON, OR ARISING OUT OF,
UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN), OR ACTIONS OF THE BORROWER, THE
LOAN PARTIES OR RZB.  THIS PROVISION IS A MATERIAL INDUCEMENT FOR RZB MAKING THE
LOANS  TO  THE  BORROWER  AND  THE  LOAN  PARTIES.

               (j)  NO  CLAIM  MAY  BE MADE BY THE BORROWER OR ANY LOAN PARTY OR
ANY  OTHER  PERSON  AGAINST  RZB  OR THE PARTICIPANT OR THE OFFICERS, DIRECTORS,
EMPLOYEES  OR  AGENTS  OF  RZB  OR  THE  PARTICIPANT  FOR ANY SPECIAL, INDIRECT,
PUNITIVE OR CONSEQUENTIAL DAMAGES IN RESPECT OF ANY CLAIM FOR BREACH OF CONTRACT
OR  ANY  OTHER THEORY OF LIABILITY ARISING OUT OF OR RELATED TO THE TRANSACTIONS
CONTEMPLATED  BY  THIS  AGREEMENT,  ANY  OBLIGATIONS OF THE BORROWER OR ANY LOAN
PARTY  AND/OR  ANY OF THE COLLATERAL, OR ANY ACT, OMISSION OR EVENT OCCURRING IN
CONNECTION  THEREWITH,  AND  THE  BORROWER  AND  EACH  LOAN PARTY HEREBY WAIVES,
RELEASES  AND  AGREES  NOT  TO  SUE  UPON  ANY  CLAIM  FOR  ANY  SUCH  DAMAGES.

               (k)  Notwithstanding  the  Participation  Agreement, the Borrower
shall  be  permitted, except as otherwise expressly provided herein, to send all
notices, requests and documents solely to RZB and not to the Participant, and to
act  on  instruction,  requests  and  directions  from  RZB alone.  The Borrower
acknowledges  that  pursuant to the Participation Agreement:  (i) RZB shall have
no obligation to make or issue any Loan or L/C unless approved by RZB and by the
Participant  in  accordance  with  the  Participation Agreement, in each case in
their  respective  sole  and  absolute  discretion,  and  (ii) either RZB or the
Participant shall have the right to cause RZB to make any demand under Section 4
of  this  Agreement.

               (l)  The Borrower shall simultaneously deliver to the Participant
at the address provided for in written notice from RZB or the Participant to the
Borrower  a  copy  of  each  request  for a Loan or L/C given to RZB pursuant to
Section  3  of  this Agreement and all financial statements, notices and reports
delivered  to  RZB  pursuant  to  or  in  connection  with  this  Agreement,

                                      -13-
<PAGE>
together with all such documents and information relating to such request as the
Participant shall require.  The Borrower expressly consents to RZB's delivery to
the Participant of any documents and information relating to the Borrower now or
hereafter  in  the  possession  of  RZB.

               (m)  At  any  time when all Loans shall have been paid in full in
cash,  all L/C's shall have expired, terminated or been cash collateralized, and
all  other  obligations hereunder shall have been satisfied, in each case to the
sole  and  absolute  satisfaction  of  RZB,  the Borrower may terminate the Loan
Documents,  and  RZB will take reasonable steps to release the liens in favor of
RZB;  provided,  however,  that  notwithstanding  any  termination  of  the Loan
      --------   -------
Documents,  the  provisions  of  Section  11  of  this  Agreement  shall survive
termination  of  this  Agreement.

                                      -14-
<PAGE>
                                               Very truly yours,

                                               RZB FINANCE LLC

                                               By:  /s/ Pearl Geffers
                                                  ------------------------------
Accepted and Agreed to on this 15th day of        Name:  Pearl Geffers
                               ----               Title: First Vice President
September, 2004
---------

                                               By:  /s/ Griselda Alvizo
                                                  ------------------------------
                                                  Name:  Griselda Alvizo
                                                  Title: Vice President

PENN OCTANE CORPORATION

By:  /s/ Jerome B. Richter
    ---------------------------------
    Name:  Jerome B. Richter
    Title:  Chief Executive Officer

The undersigned hereby acknowledges and consents
to the foregoing Amended and Restated Line Letter
and hereby confirms that the Guaranty and
Agreement dated as of October 14, 1997 is hereby
ratified and confirmed in all respects and shall
extend to all indebtedness, liabilities and
obligations under or in connection with the
foregoing Amended and Restated Line letter, as
amended, modified or supplemented from time to
time.

/s/ Jerome B. Richter
-----------------------------
    Jerome Richter

                                      -15-
<PAGE>

                                  Schedule 7(e)

                                      Liens

                                      -16-
<PAGE>

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