AMENDMENT TO
PROMISSORY NOTES
THIS AMENDMENT (the "Amendment") is entered into as of this 20th day of
January, 2000 by and between Greka Energy Corporation f/k/a Horizontal Ventures,
Inc., a Colorado corporation ("Maker") and International Publishing Holding,
Inc., a Cayman Islands corporation and the assignee of International Publishing
Holding, s.a. of Luxembourg, or its designee ("Holder") based upon the following
terms and conditions.
WHEREAS, Xxxxx promised to pay to the order of Holder the principal sum
of five hundred thousand dollars ($500,000), without interest, on December 31,
1998 pursuant to that certain Promissory Note executed October 6, 1998, as
amended, (the "First Note") and that certain Pledge Agreement dated October 6,
1998; and
WHEREAS, Maker promised to pay to the order of Holder the principal sum
of one million five hundred thousand dollars ($1,500,000), with interest at the
rate of 6% per annum, on December 31, 1998 pursuant to that certain Promissory
Note executed November 4, 1998, as amended, (the "Second Note") and that certain
Pledge Agreement dated November 2, 1998; and
WHEREAS, Maker and Holder desire to further amend and modify the First
and Second Notes as set forth below.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
1. Parties. The parties agree that all references in the First and Second
Notes to Maker and Holder shall be deemed to refer to Greka Energy
Corporation and International Publishing Holding, Inc., respectively.
2. Consolidation. Effective as of January 1, 2000, the terms of the First and
Second Notes are consolidated, providing for anaggregate principal amount
of two million dollars ($2,000,000) owed by Maker to Holder (collectively,
the "Consolidated Note").
3. Maturity Date. The Maturity Date of the Consolidated Note shall be extended
to June 30, 2000 whereupon the entire unpaidprincipal and accrued but
unpaid interest shall be paid in full.
4. Interest. The unpaid principal shall accrue simple interest at the rate of
nine percent (9%) per annum commencing January 1,2000 payable quarterly, on
March 31, 2000 and June 30, 2000.
5. Installment Payments. Commencing on February 25, 2000 and continuing on the
25th day of each month thereafter through theMaturity Date, Maker shall pay
Holder as a reduction in principal one hundred thousand dollars ($100,000).
6. Additional Consideration. Interest accrued on the unpaid balance up to
January 1, 2000 is cancelled. Upon the parties' full execution of this
Amendment, Maker shall pay to Holder the amount of one hundred eighty
thousand dollars ($180,000) as a restructuring fee, and such payment shall
not be deemed to be a payable under any other provision of this Amendment.
_/s/_____ /s/______
(initials) (initials)
7. Prepayment. Maker may prepay any or all of the amounts due under the
Consolidated Note at any time, and from time to time, without penalty.
8. Security. The obligations of Maker under the Consolidated Note are secured
pursuant to the provisions of the Pledge Agreements dated October 6, 1998
and November 2, 1998 between Maker and Holder. The reference to
"obligations" in those Pledge Agreements shall be deemed to refer to the
obligations of Maker under the Consolidated Note.
9. Default. If the entire unpaid principal and/or accrued but unpaid interest
is not paid in full on June 30, 2000, then:
a. on July 1, 2000, the amount of principal owed by Maker shall increase
by fifteen percent (15%) of the unpaid principal outstanding on June
30, 2000, and
b. the accrued but unpaid interest as of July 1, 2000 will be added to
the amount of the unpaid principal; and
c. the interest accruing on the unpaid principal as of July 1, 2000 shall
increase to the rate of fifteen percent (15%) per annum commencing
July 1, 2000; however, in no event shall Holder be entitled to collect
any interest in excess of the maximum interest permitted by applicable
law.
10. Place of Payments. All payments by Maker to Holder under the Consolidated
Notes shall be made by wire transfer to:
Bank: United Bank of Switzerland
000 Xxxxxxxxxx Xxxx., Xxxxxxxx, XX 00000 XXX
A/C no: 101WA003611000
ABA #: 000000000
SWIFT code: SBCO US33
For further credit to: VP Bank Luxembourg, Grand Duchy of Luxembourg
Beneficiary: International Publishing Holding Inc. A/C No. 69270
11. Miscellaneous. This Agreement, once executed by a party, may be delivered
to the other party hereto by facsimile transmission of a copy of this
Agreement bearing the signature of the party so delivering this Agreement.
This Amendment supersedes all prior amendments to the First and Second
Notes. All other terms and conditions of the First and Second Notes as
originally stated therein remain in full force and effect.
IN WITNESS WHEREOF, the parties have executed this Amendment effective as
of the day first written above.
Greka Energy Corporation International Publishing Holding, Inc.
By: /s/__________________________ By: /s/__________________________
