AMENDED PROMISSORY NOTE






AMENDED PROMISSORY NOTE

 

$16,200,000 

                 
October 27, 2008 

 

This Amended Promissory Note amends and restates a Promissory Note
originally dated on or about September 7,2007, as follows: 

 

FOR VALUE RECEIVED, NORTHCUT REFINING, LLC, a Wyoming limited
liability company ("Borrower," whether one or more) hereby promises to pay to
the order of PRIVATE CAPITAL GROUP, INC., a Utah corporation, as servicing agent
for loan Participants (together with any and all of its successors and assigns
and/or any other holder of this Note, "Lender"), without offset, in immediately
available funds in lawful money of the United States of America, at 486 West
50th North, American Fork, UT
84003 in the principal sum of SIXTEEN MILLION TWO HUNDRED THOUSAND DOLLARS
($16,200,000) (or the unpaid balance of all principal advanced against this
Note, if that amount is less), together with interest on the unpaid principal
balance of this Note from day to day outstanding as hereinafter provided. 




1.

 Payment
Schedule and Maturity Date. The entire unpaid principal balance of this Note
and all accrued but unpaid interest, costs and fees shall be due and payable in
full on August 1, 2009 (the "Maturity Date"), the final maturity of this Note.
Borrower shall again commence to pay Lender accrued but unpaid interest of Two
Hundred Fifty Thousand Dollars ($250,000) on or before December 1, 2008, and Two
Hundred Fifty Thousand Dollars ($250,000) on or before January 1,2009. On or
before February 1,2009, Borrower shall pay all accrued but unpaid interest,
which is estimated to be Four Million Three Hundred Nineteen Thousand Six
Hundred Five Dollars and 48/100 ($4,319,605.48). Additionally, commencing on
March 1, 2009 and on the first day of each month thereafter, Borrower shall also
pay Lender all other accrued but unpaid interest one (1) month in arrears. No principal need be paid
on this Promissory Note until the Maturity Date of August 1, 2009. 




2.

 Security;
Loan Documents. The security for this Note includes an existing gas refinery
and an oil refinery to be built (which, as it may have been or may be amended,
restated, modified or supplemented from time to time, is herein called the "Deed
of Trust") from Borrower to Lender, covering certain property in Converse
County, Wyoming, described therein (the "Property"). This Note, the Deed of
Trust, the Construction Loan Agreement between Borrower and Lender of even date
herewith (the "Loan Agreement") and all other documents now or hereafter
securing, guaranteeing or executed in connection with the loan evidenced by this
Note (the "Loan"), are, as the same have been or may be amended, restated,
modified or supplemented from time to time, herein sometimes called individually
a "Loan Document" and together the "Loan Documents." 




3.


Interest
Rate. Interest shall accrue on the principal balance at the rate of
twenty-four percent (24%) per annum. The interest shall be calculated daily on
the basis of a three hundred sixty (360) day year for all amounts outstanding
but, in any case, shall be computed on the actual number of days in the period
for which interest is charged, which period shall consist 





of three hundred sixty-five (365) or three hundred sixty-six (366)
days on an annual basis. If any payment of interest under this Promissory Note
would otherwise be due on a day which is not a business day, the payment instead
shall be due on the next succeeding business day, and such extension of time
shall be included in computing the interest due in respect of said payment.
After notice has been given that a Default has occurred under this Promissory
Note or the Construction Loan Agreement, the Deed of Trust or any of the Loan
Documents, and the failure of Borrower to timely cure the Default, the interest
rate payable hereunder, both before and after judgment and in any bankruptcy
proceeding, shall be at the rate of thirty-six percent (36%) per annum until
paid. 

 4. 

Prepayment. This Promissory Note may be prepaid at any time
without penalty. 




5.


Late
Charges. If Borrower shall fail to make any payment under the terms of this
Note within five (5) days after the date such payment is due, Borrower shall pay
to Lender on demand a late charge equal to four percent (4%) of such payment.
Such five (5) day period shall not be construed as in any way extending the due
date of any payment. The "late charge" is imposed for the purpose of defraying
the expenses of Lender incident to handling such delinquent payment. This charge
shall be in addition to, and not in lieu of, any other remedy Lender may have
and is in addition to any fees and charges of any agents or attorneys which
Lender may employ upon the occurrence of a Default (hereinafter defined)
hereunder, whether authorized herein or by law. 




6.


Certain
Provisions Regarding Payments. All payments made as scheduled on this Note
shall be applied, to the extent thereof, to late charges, to accrued but unpaid
interest, unpaid principal, and any other sums due and unpaid to Lender under
the Loan Documents, in such manner and order as Lender may elect in its sole
discretion. All permitted prepayments on this Note shall be applied, to the
extent thereof, to accrued but unpaid interest on the amount prepaid, to the
remaining principal installments, and any other sums due and unpaid to Lender
under the Loan Documents, in such manner and order as Lender may elect in its
sole discretion, including but not limited to application to principal
installments in inverse order of maturity. Except to the extent that specific
provisions are set forth in this Note or another Loan Document with respect to
application of payments, all payments received by Lender shall be applied, to
the extent thereof, to the indebtedness secured by the Deed of Trust in such
manner and order as Lender may elect in its sole discretion, any instructions
from Borrower or anyone else to the contrary notwithstanding. Remittances in
payment of any part of the indebtedness other than in the required amount in
immediately available U.S. funds shall not, regardless of any receipt or credit
issued therefor, constitute payment until the required amount is actually
received by Lender in immediately available U.S. funds and shall be made without
offset, demand, counterclaim, deduction, or recoupment (each of which is hereby
waived) and' accepted subject to the condition that any check or draft may be
handled for collection in accordance with the practice of the collecting bank or
banks. Acceptance by the holder hereof of any payment in an amount less than the
amount then due on any indebtedness shall be deemed an acceptance on account
only, notwithstanding any notation on or accompanying such partial payment to
the contrary, and shall not in any way excuse the existence of a Default. 





8. 

Commercial Purpose. Borrower warrants that the Loan is
being made solely to acquire or carry on a business or commercial enterprise,
and/or Borrower is a business or commercial organization. Borrower further
warrants that all of the proceeds of this Note shall be used for commercial
purposes and stipulates that the Loan shall be construed for all purposes as a
commercial loan, and is made for other than personal, family, household or
agricultural purposes. 

 

9. 

WAIVER OF JURY TRIAL. BORROWER WAIVES TRIAL BY JURY IN
ANY ACTION OR PROCEEDING TO WHICH BORROWER AND LENDER MAY BE PARTIES, ARISING
OUT OF, IN CONNECTION WITH OR IN ANY WAY PERTAINING TO, THIS NOTE, THE LOAN
AGREEMENT, THE DEED OF TRUST OR ANY OF THE OTHER LOAN DOCUMENTS. IT IS AGREED
AND UNDERSTOOD THAT THIS WAIVER CONSTITUTES A WAIVER OF TRIAL BY JURY OF ALL
CLAIMS AGAINST ALL PARTIES TO SUCH ACTION OR PROCEEDINGS, INCLUDING CLAIMS
AGAINST PARTIES WHO ARE NOT PARTIES TO THIS NOTE. THIS WAIVER IS KNOWINGLY,
WILLINGLY AND VOLUNTARILY MADE BY BORROWER, AND BORROWER HEREBY REPRESENTS THAT
NO REPRESENTATIONS OF FACT OR OPINION HAVE BEEN MADE BY ANY INDIVIDUAL TO INDUCE
THIS WAIVER OF TRIAL BY JURY OR TO IN ANY WAY MODIFY OR NULLIFY ITS EFFECT.
BORROWER FURTHER REPRESENTS AND WARRANTS THAT IT HAS BEEN REPRESENTED IN THE
SIGNING OF THIS NOTE AND IN THE MAKING OF THIS WAIVER BY INDEPENDENT LEGAL
COUNSEL, OR HAS HAD THE OPPORTUNITY TO BE REPRESENTED BY INDEPENDENT LEGAL
COUNSEL SELECTED OF ITS OWN FREE WILL, AND THAT IT HAS HAD THE OPPORTUNITY TO
DISCUSS THIS WAIVER WITH COUNSEL. 

 

10. 

Service of Process. Borrower hereby irrevocably designates
and appoints Tim Williams, whose address is 160 West Canyon Crest, Alpine, Utah,
84004, as Borrower's authorized agent to accept and acknowledge on Borrower's
behalf service of any and all process that may be served in any suit, action, or
proceeding instituted in connection with this Note in any state or federal court
sitting in the State of Utah or Wyoming. If such agent shall cease so to act,
Borrower shall irrevocably designate and appoint without delay another such
agent in the State of Utah satisfactory to Lender and shall promptly deliver to
Lender evidence in writing of such agent's acceptance of such appointment and
its agreement that such appointment shall be irrevocable. 

 

Borrower hereby consents to process being served in any suit,
action, or proceeding instituted in connection with this Note by (a) the mailing
of a copy thereof by certified mail, postage prepaid, return receipt requested,
to Borrower and (b) serving a copy thereof upon the agent hereby designated and
appointed by Borrower as Borrower's agent for service of process. Borrower
irrevocably agrees that such service shall be deemed to be service of process
upon Borrower in any such suit, action, or proceeding. Nothing in this Note
shall affect the right of Lender to serve process in any manner otherwise
permitted by law and nothing in this Note will limit the right of Lender
otherwise to bring proceedings against Borrower in the courts of any
jurisdiction or jurisdictions. 




11.


Successors
and Assigns. The terms of this Note and of the other Loan Documents shall
bind and inure to the benefit of the successors and assigns of the parties. The
foregoing sentence shall not be construed to permit Borrower to assign the Loan
except as otherwise permitted under the Loan Documents. As further provided in
the Loan Agreement, Lender may, at any time, sell, transfer, or assign this
Note, the Deed of Trust and the other Loan Documents, and any or all servicing
rights with respect thereto, or grant participations therein or issue mortgage
pass-through certificates or other securities evidencing a beneficial interest
in a rated or unrated public offering or private placement. 




12.


General
Provisions. Time is of the essence with respect to Borrower's obligations
under this Note. If more than one person or entity executes this Note as
Borrower, all of said parties shall be jointly and severally liable for payment
of the indebtedness evidenced hereby. Borrower and all sureties, endorsers,
guarantors and any other party now or hereafter liable for the payment of this
Note in whole or in part, hereby severally (a) waive demand, presentment for
payment, notice of dishonor and of nonpayment, protest, notice of protest,
notice of intent to accelerate, notice of acceleration and all other notices
(except any notices which are specifically required by this Note or any other
Loan Document), filing of suit and diligence in collecting this Note or
enforcing any of the security herefor; (b) agree to any substitution,
subordination, exchange or release of any such security or the release of any
party primarily or secondarily liable hereon; (c) agree that Lender shall not be
required first to institute suit or exhaust its remedies hereon against Borrower
or others liable or to become liable hereon or to perfect or enforce its rights
against them or any security herefor; (d) consent to any extensions or
postponements of time of payment of this Note for any period or periods of time
and to any partial payments, before or after maturity, and to any other
indulgences with respect hereto, without notice thereof to any of them; and (e)
submit (and waive all rights to object) to non-exclusive personal jurisdiction
of any state or federal court sitting in the State of Utah or Wyoming, and venue
in any city or county in those states for the enforcement of any and all
obligations under this Note and the Loan Documents; (f) agree that their liability under this Note
shall not be affected or impaired by any determination that any security
interest or lien taken by Lender to secure this Note is invalid or unperfected;
and (g) hereby subordinate any and all rights against Borrower and any of the
security for the payment of this Note, whether by subrogation, agreement or
otherwise, until this Note is paid in full. A determination that any provision
of this Note is unenforceable or invalid shall not affect the enforceability or
validity of any other provision and the determination that the application of
any provision of this Note to any person or circumstance is illegal or
unenforceable shall not affect the enforceability or validity of such provision
as it may apply to other persons or circumstances. This Note may not be amended
except in a writing specifically intended for such purpose and executed by the
party against whom enforcement of the amendment is sought. Lender is hereby
authorized to disseminate any information it now has or hereafter obtains
pertaining to the Loan, including, without limitation, any security for this
Note and credit or other information on Borrower, any of its principals and any
guarantor of this Note, to any actual or prospective assignee or participant
with respect to the Loan, to any of Lender's affiliates, to any regulatory body
having jurisdiction over Lender, and to any other parties as necessary or
appropriate in Lender's reasonable judgment, as further provided in the Loan
Agreement. Captions and headings in this Note are for convenience only and shall
be disregarded in construing it. THIS NOTE, AND ITS VALIDITY, ENFORCEMENT AND
INTERPRETATION, SHALL BE GOVERNED BY UTAH LAW (WITHOUT REGARD TO ANY CONFLICT OF
LAWS PRINCIPLES) AND APPLICABLE UNITED STATES FEDERAL LAW. 

 

13. 

Notices; Time. All notices, requests, consents, approvals
or demands (collectively, "Notice") required or permitted by this Note to be
given by any party to any other party hereunder shall, unless specified
otherwise, be in writing (including facsimile (fax) transmission) and shall be
given to such party at its address or fax number set forth on the signature
pages hereof, or such other address or fax number as such party may hereafter
specify for the purpose by Notice to the other party. Each such Notice shall be
effective when actually received by the addressee or when the attempted initial
delivery is refused or when it cannot be made because of a change of address of
which the sending party has not been notified; provided, that notices to Lender
and notices of changed address or fax number, shall not be effective until
received. 

 

THE LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE
PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. 

THERE ARE NO ORAL AGREEMENTS BETWEEN THE PARTIES. 

 

IN WITNESS WHEREOF, Borrower has duly executed this Note under
seal as of the date first above written. 

 

Accepted: 

BORROWER: 

PRIVATE CAPITAL GROUP, a Utah 

NORTHCUT REFINING, LLC, a Wyoming corporation
            limited
liability company 

By: Interline Resources Corporation, its Manager




By: /s/ Jared L. Lucero_____________

By: /s/ Michael R. Williams____________

Name: Jared L. Lucero, its President

Name: Michael R. Williams, Its President