Document:

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                                                                    EXHIBIT 10.9

                          NATIONAL AUTO CREDIT, INC.
                                  LETTERHEAD

April 5, 2000

James J. Cotter, Chairman
Reading Entertainment, Inc.
One Penn Square West
30 South Fifteenth Street, Suite 1300
Philadelphia, PA 19103-4831

     Re:  Acquisition of Domestic Cinema Assets

Dear Mr. Cotter:

As we have discussed, National Auto Credit, Inc. ("National") is interested in
entering into the motion picture exhibition business in the United States
through it wholly-owned subsidiary National Cinemas, Inc. ("National Cinemas").
National and National Cinemas have entered into an agreement (the "Angelika
Agreement") with Reading Entertainment, Inc. ("RDG" and collectively with its
consolidated subsidiaries, "Reading") to acquire a 50% membership interest in
Angelika Film Centers, LLC ("AFC"). The purpose of this letter is to set out the
terms under which Reading has agreed to grant to National an option to acquire
the remainder of Reading's domestic cinema assets.

A.   The Option Fee: Promptly following the execution and delivery of this
     --------------
letter agreement, National will transfer to Reading the sum of $500,000, in
consideration of the rights granted by Reading to National pursuant to this
letter agreement.

B.   The Assets Covered: In consideration of the payment of this fee, National
     ------------------
will have the option, as described hereinbelow, to acquire the following assets:

     1.   The City Cinemas Rights: These are the rights held by Reading under
          -----------------------
that certain Agreement in Principle between RDG, James J. Cotter and Michael
Forman dated December 2, 1998, a copy of which is appended as Appendix A to this
letter (the "City Cinemas Agreement"), other than the right to acquire the 1/6th
interest in AFC and the right to acquire by merger Off Broadway, Inc. described
in that Agreement in Principle.  The purchase price of this asset will be an
amount equal to Reading's transaction costs with respect to such transaction
(including reimbursement of the $1 million deposit previously made by Reading
and which counts as a credit against the option fee specified in the City
Cinemas Agreement).

     2.   The Domestic Cinema Assets: These include the following cinema assets:
          --------------------------
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          a)   The remaining interest held by Reading in AFC (including the
               interest being acquired pursuant to the City Cinemas Agreement);
          b)   The Angelika Film Center Houston (Houston, Texas);
          c)   The Reading Mansville 12 (Mansville, New Jersey);
          d)   The St. Anthony Main (Minneapolis, Minnesota);
          e)   The Tower Cinema (Sacramento, California)
          f)   The Angelika Film Center Buffalo (Buffalo, New York); and
          g)   The Angelika Film Center Dallas (under development in Dallas,
               Texas).

          Provided, that Reading is currently in negotiations with respect to
          the Angelika Film Center Buffalo, and may terminate its rights and
          obligations with respect to such cinema complex if it is not satisfied
          with the results of such negotiation.

          The purchase price of the Domestic Cinema Assets will be as follows:

          a)   With respect to the remaining interest in AFC, the million;
               amount of $13.5
          b)   With respect to the cinemas at Houston, Mansville, Minneapolis,
               Sacramento and Buffalo, the lesser of Reading's historic cost
               basis in such assets and the fair market value of such cinemas
               (such fair market value to be determined, in the event of dispute
               between the parties, by binding arbitration under the rules of
               the American Arbitration Association); and
          c)   With respect to the cinema under development in Dallas, Reading's
               cost basis in such asset.

C.   Exercise Option: National will have a period of sixty (60) days, through
     ---------------
and including June 5, 2000 in which to determine whether or not it wishes to
proceed with the acquisition of the City Cinema Rights and the Domestic Cinema
Assets. National shall have the right to extend the sixty (60) day period
provided in the immediately preceding sentence for up to two (2) additional
periods of thirty (30) days, by written notice to Reading given on or before the
expiration of such sixty (60) day period (or extension thereof) accompanied by
payment to Reading of $100,000 in immediately available funds for each such
thirty (30) day extension. If National determines that it wishes to exercise the
option, it will give written notice of that election to Reading within this
period. Thereafter, National and Reading will cooperate and work in good faith
to complete the definitive documentation necessary to complete the transaction,
with an intention to close such transactions within sixty (60) days of the date
of such election. Closing shall be subject to compliance with the Hart-Scott-
Rodino Antitrust Improvements Act.

D.   Citadel Offer: In the event that National elects to exercise the Option
     -------------
that is the subject of this letter agreement, National will offer to Citadel
Holding Corporation ("Citadel") the right to form a joint venture with National
or National Cinemas (as the case may be) to acquire the City Cinemas Rights and
the Domestic Cinema Assets. The joint venture would be structured as a

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Delaware limited liability company, and would be generally on the terms set out
in Appendix B to this letter. Citadel will have until the later of (i) thirty
(30) days following the date on which National offers Citadel such right and
(ii) two (2) business days following the date on which National notifies Citadel
(by coy of its notice to Reading) whether it elects to exercise the option
granted to National by RDG and FA, Inc. by letter of even date herewith to
purchase the additional 1/3 Membership Interest in AFC held by FA, Inc., in
which to elect in writing to accept such offer. Thereafter, if Citadel elects to
accept such offer, National and Citadel will cooperate and work in good faith to
complete the definitive documentation necessary to complete the transaction
within the time periods specified above. If Citadel has elected to participate
in the joint venture and then fails for any reason, other than default by
National or National Cinemas, to close, National will be entitled, at its
option, within ten (10) business days of such default, to revoke through written
notice to Reading, its exercise of the option to acquire the city Cinema Rights
and the Domestic Cinema Assets.

E.   Exclusivity: Reading agrees to deal exclusively with National during the
     -----------
term of this option; provided, however, that Reading will be entitled to
continue its negotiations with Citadel and to enter into agreements with Citadel
with respect to the City Cinema Rights and the Domestic Cinema Assets, so long
as any agreements entered into with Citadel are entered into subject to the
rights of National under this letter agreement. National also acknowledges and
agrees that Reading may elect to dispose of its interest in the Angelika Film
Center Buffalo separate from this agreement.

F.   Return of Option Fee: In the event of failure to close the acquisition of
     --------------------
the City Cinemas Rights and the Domestic Cinema Assets due to default on the
part of Reading, National will be entitled to a refund of the option fee. In all
other cases, such fee will be deemed fully earned by Reading upon the execution
and delivery of this letter agreement by Reading.

G.   Form and Payment of the Purchase Price: The purchase price will be paid in
     --------------------------------------
full at the Closing by wire transfer of currently available funds. In the event
of such a closing, the option fee will be credited to the purchase price
(including any fee paid for the extension thereof).

           [THE REMAINDER OF THIS PAGE IS LEFT INTENTIONALLY BLANK.]

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Should you have any questions, please feel free to contact me at (440) 349-1000.

Sincerely,

/s/ David L. Huber

David L. Huber
Chairman of the Board and
Chief Executive Officer

ACCEPTED AND AGREED
AS OF THIS 5th DAY
           ---
OF APRIL, 2000

READING ENTERTAINMENT, INC.

By:  /s/ S. Craig Tompkins
     --------------------------

Its: Vice Chairman
     --------------------------

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<PAGE>

Addendum

Reading Entertainment, Inc.

Date:  April 3, 2000

To:    David Huber

From:  S. Craig Tompkins

Re:    Revised Term Sheet

Set forth below is a term sheet for a possible acquisition by a joint venture
between an affiliates of CDL and an affiliate of NAC of the RDG Domestic Cinema
Business.

1. Definitions:          CDL means Citadel Holding Corporation, a publicly
                         traded Nevada company, whose shares are listed for
                         trading on the American Stock Exchange.

                         CRG means Craig Corporation, a publicly traded Nevada
                         company, whose shares are listed for trading on the New
                         York Stock Exchange.

                         NAC means National Auto Credit, Inc., a Delaware
                         company whose share are traded in the Over the Counter
                         market.

                         RDG means Reading Entertainment, Inc., a publicly
                         traded Nevada company, whose shares are quoted on the
                         NASD Stock Market, and Reading means RDG together with
                         all of its consolidated subsidiaries.

2. Formation of LLC:     CDL and NAC, through wholly owned affiliates, would
                         form 50/50 Delaware LLC, under the name City Cinemas
                         LLC (the "LLC") to engage in the business of
                         developing, owning and operating cinemas in the United
                         States. CDL and NAC would adopt a members agreement
                         having, in addition to the usual and customary
                         provisions typical for members agreement for LLC's
                         organized under the laws of Delaware, the following
                         provisions.
<PAGE>

                    a) Co-management:

                         The LLC would have self contained cinema  management,
                         which will report to a four member management
                         committee. The initial president of the LLC would be
                         Robert Smerling The LLC may look to CDL to provide
                         certain accounting and financial consulting services,
                         such service to be provided on a cost basis.  CDL and
                         NAC would each have two representatives to the
                         management committee.  James J. Cotter, or his
                         designee, will serve as the Chairman of the management
                         committee.  All decisions will be by majority vote.  In
                         the event of deadlock, the Chairman will cast the
                         deciding vote.

                    b) Rights of first refusal upon any transfer of LLC
                       Interests

                    c) Preemptive Rights with respect to any new capital

                    d) NAC Conversion Right:

                         During the period April 1 2002 to June 30 2002, NAC
                         would have the right to convert its entire interest in
                         the LLC into CDL Class A Non-Voting Common Stock (the
                         "CDL Class A Stock").  The conversion price would be
                         fixed at the time the parties enter into a binding
                         agreement, by reference to the average closing price of
                         CDL Class A Stock over the 28 trading days immediately
                         preceding the announcement of the execution and
                         delivery of definitive documentation between the
                         parties with respect to the formation of the LLC.  The
                         value of NAC's interest in the LLC for purposes of
                         exercising the conversion right would be the balance of
                         its capital account from time to time.

                    e) NAC Put Right:

                         In the event that NAC does not exercise its conversion
                         right, then during the period April 1, 2006 to June 30,
                         2006, NAC will have the right to put its interest in
                         the LLC to CDL at FMV as determined by a third party
                         appraisal process.  CDL will have the right to either
                         pay either cash or CDL Class A Stock for the LLC
                         interest, such CDL Class A Stock to be
<PAGE>

                         valued at market by reference to the average closing
                         price of such securities during the 28 trading days
                         immediately preceding the exercise of such put option.

                    f) Registration Rights:

                         Subject to usual and customary terms and limitations,
                         NAC would have one demand and one piggy back
                         registration right with respect to any CDL Class A
                         Stock issued to it upon the exercise of its conversion
                         or put rights.

                    g) CDL Board Representation:

                         So long as NAC maintains its interest in the LLC or
                         holds equity securities representing not less than 20%
                         of the outstanding equity of CDL, RDG and CRG will use
                         their good faith best efforts, subject to their
                         respective fiduciary obligations, to nominate and elect
                         to the CDL Board two individuals nominated by NAC.

                    h)  Distributions:

                         The members would use their good faith best efforts to
                         distribute each year (distributions to be made on a
                         quarterly basis) an amount equal to at least a 6%
                         return on investment to the members.

                    i)  Reports:

                         Management would be responsible to prepare and
                         distribute timely quarterly and annual reports,
                         prepared on an accrual basis in accordance with
                         generally accepted accounting practices, applied on a
                         consistent basis.  These reports will be provided in
                         sufficient time to allow incorporation of such
                         financial information in the public reports of CDL and
                         NAC.  By not later than November 1 of each year,
                         management will deliver to the management committee a
                         budget for the following year.
<PAGE>

                      j)  Accounting and Tax Matters:

                              The accountants for the LLC will be a Big 5
                              accounting firm, and so long as CDL makes use of
                              such a Big 5 accounting firm, such firm will be
                              the firm retained by the LLC as its independent
                              auditor. At the present time, CDL's independent
                              auditor is Deloitte & Touch. CDL will be the tax
                              matters partner for the LLC.

3. Capital:           CDL and NAC will each initially contribute $20 million,
                      for a total of $40 million. The LLC will seek to achieve a
                      gearing ratio of not less than the lesser of 50% or 5
                      times EBITDA. Neither member will be required to guarantee
                      any such borrowings.

4. Use of Proceeds:   The proceeds will be used for working capital, to acquire
                      the 50% interest in the Angelika Film Center LLC currently
                      being acquired by NAC (valued for purposes of this
                      transaction at $13.5 million) and to acquire the RDG
                      Domestic Cinema Business, currently consisting of the
                      following assets:

                      a) Angelika Film Centers LLC. CDL would acquire from RDG
                      and Sutton Hill and contribute to the LLC as a portion of
                      its capital contribution all of the membership interests
                      of Angelika Film Centers LLC, not owned by NAC (such
                      interest to be valued for purposes of this transaction at
                      $13.5 million).

                      b) City Cinemas Circuit: The LLC will lease from RDG, with
                      the option to purchase at an exercise price of $48
                      million, all of the assets comprising the City Cinemas
                      Circuit in Manhattan. The lease/option transaction will be
                      on substantially the same terms as set forth in the
                      Agreement in Principal between City Cinemas and RDG dated
                      December 2, 1998, and would include an assumption of the
                      obligations to fund the loans contemplated by that
                      agreement. The LLC will reimburse RDG for its out of
                      pocket costs in connection with the negotiation,
                      documentation and closing of the lease/option transaction
                      with Messrs. Cotter and Forman and their affiliates.

                      c) Reading Cinemas USA: The LLC will acquire RDG's
                      interest in the following cinemas, which cinemas
                      (excluding the Angelika Soho)
<PAGE>

                      constitute all of the cinemas owned or leased by RDG in
                      the United States:

                              The Angelika Film Center and Cafe, Houston
                              The Angelika Film Center and Cafe, Buffalo
                              The Reading Cinema, Manville
                              The St Anthony Main Theatre, Minneapolis
                              The Tower Cinema, Sacramento

                      The above cinemas will be acquired at the lesser of
                      historic cost, an amount approximating $15 million, or
                      fair market value. It is understood that the capital of
                      the LLC may not be sufficient to purchase of all of the
                      above assets. In such case, the parties will explore other
                      alternatives, including, by way of example, the sublease
                      of certain cinema facilities. It is to be noted that
                      Reading is currently in the process of renegotiating its
                      rights and obligations with respect to the Angelika Film
                      Complex in Buffalo. If that renegotiation is not
                      successful, Reading currently intends to exercise its
                      rights to terminate its obligations with respect to that
                      cinema complex.

                      d) New and Developmental Cinemas: The LLC will acquire
                      from RDG at cost its rights with respect to the lease and
                      development of the Angelika Film Center and Cafe, Dallas,
                      and with respect to any other acquisitions under
                      negotiation at the time of the formation and funding of
                      the LLC.

                      e) Puerto Rico Management Agreement: The LLC will acquire
                      the management agreement between RDG and Reading Cinemas
                      of Puerto Rico, which provides for RDG to provide
                      executive management services to that company on
                      commercially reasonable rates.

                      f) Covenant Not to Compete: NAC, CRG, RDG, CDL and their
                      respective subsidiary affiliate will agree not to compete
                      with the LLC for a period of ten years, provided, however,
                      that in the event the LLC declines to acquire or develop a
                      cinema opportunity, it will refer that cinema opportunity
                      to CDL and there after to RDG. If CDL or RDG elects to
                      take advantage of such opportunity, the LLC will agree, at
                      the election of CDL or RDG, as the case may be, to manage
                      the cinema on competitive commercial terms. Nothing in
                      this provision, however, will be interpreted to limit
                      RDG's rights as the landlord under the lease referred to
                      in Subclause b) above or to operate the

<PAGE>

                    cinemas subject to that lease in the event of default by the
                    LLC.

5.   Costs:         All costs related to the formation of the LLC and the
                    negotiation and documentation of the acquisition of the
                    initial assets of the LLC will be a cost of the LLC.
                    However, the LLC will not be responsible for the individual
                    costs of the members, including, without limitation, the
                    cost and expenses of their separate counsel, consultants and
                    financial advisors.  Troy & Gould, of Los Angeles,.
                    California, counsel to CDL, will form the LLC, draft the
                    membership agreement, and thereafter represent the LLC with
                    respect to its legal affairs.AGREEMENT

         THIS  AGREEMENT  (this  "Agreement")  is entered  into  effective as of
January 1, 2000, by and between FX Energy,  Inc., a Nevada corporation,  and its
subsidiaries  and  affiliates  through  which it owns  interests and carries out
activities in Poland (collectively,  "FX Energy"), and Apache Overseas,  Inc.. a
Delaware corporation,  and its subsidiaries and affiliates through which it owns
interests and carries out activities in Poland (collectively, "Apache").

                                    Recitals

         A. Apache and FX Energy hold certain  rights to explore for and exploit
natural  gas and oil in certain  lands in the  Republic  of Poland and have been
conducting  exploration  operations  in Poland  pursuant to various  agreements.
Apache and FX Energy jointly hold exploration rights covering approximately 11.5
million acres and options covering approximately 3.4 million acres controlled by
Polski Gornictwo Naftowe i Gazownictwo S.A. ("POGC").

         B. The  strategic  alliance  of Apache and FX Energy  has  historically
focused on an extensive  exploration program. To date, Apache and FX Energy have
jointly participated in the drilling of six wells, and Apache has covered all of
FX Energy's drilling and completion costs for five of the six wells.  Apache and
FX Energy also entered into a Farmin  Agreement with POGC with respect to POGC's
Lachowice  area.  The  Farmin  Agreement  was the  first  agreement  of its kind
executed by POGC with foreign entities.

         C. The close  relationship  that  Apache and FX Energy  have  developed
together.  and with POGC  will  hopefully  lead to an  expanded  program  in the
Republic of Poland that will include the acquisition of producing properties and
the  development  and  enhancement of proven  properties  within the Republic of
Poland. Apache and FX Energy have been evaluating several opportunities, and, as
a result of their  analyses,  executed a Letter of Intent with POGC that,  among
other  things,  establishes  an  exclusive  negotiation  period  for a  proposed
transaction  involving  the  acquisition  of interests  in the Koscian,  Rensko,
Obrzycko,   Paproc  East  and  Stezyca   project   areas  (the   "Zielona   Gora
transaction").

         D. In light of these developments,  Apache and FX Energy wish to modify
certain  provisions  of  their  existing   agreements  and  acknowledge  certain
additional agreements.

                                    Agreement

         NOW, THEREFORE,  in consideration of the foregoing recitals,  which are
incorporated  herein  by  this  reference,  and  for  other  good  and  valuable
consideration,   the  receipt  and  legal   sufficiency   of  which  are  hereby
acknowledged, the parties hereto agree as follows:

1. Interim Funding Agreement (Zielona Gora). Apache and FX Energy are parties to
an Interim Funding Agreement dated as of September 30, 1999. The Interim Funding
Agreement,  among other things, sets forth a timetable for FX Energy's obtaining
of third party financing for the Zielona Gora transaction.  Any capitalized term
used in this Section 1 but not defined shall have the meaning given such term in
the Interim Funding Agreement.

         The Interim Funding Agreement is hereby amended as follows:

<PAGE>

                  (i) Extension. According to Paragraph 1 of the Interim Funding
         Agreement, "[i]f a Definitive Agreement has not been signed by December
         31, 1999,  this Agreement  shall have no further force or effect unless
         extended by mutual agreement of the parties." In addition,  the Interim
         Funding  Agreement states that only Definitive  Agreements signed on or
         before  December  31,  1999  will be  subject  to the  Interim  Funding
         Agreement. The term of the Interim Funding Agreement is hereby extended
         until  July 1, 2000,  and the  deadline  for  execution  of  Definitive
         Agreements subject to the Interim Funding .Agreement is hereby extended
         until July 1, 2000.

                  (ii) Option Period.  The Interim Funding  Agreement  currently
         provides  for a  180-day  option  period  commencing  on  the  date  of
         execution of a Definitive  Agreement among POGC,  Apache and FX Energy.
         The option  period  described  in  Paragraph 4 of the  Interim  Funding
         Agreement is hereby modified and will commence on the Closing  (defined
         below)  of  the  Zielona  Gora   transaction   and  terminate  90  days
         thereafter.

                  (iii)  Determination Date. The Determination Date set forth in
         Paragraph 5 of the Interim  Funding  Agreement  is hereby  modified and
         will occur on the 90th day following the Closing (defined below) of the
         Zielona Gora transaction, or earlier at the election of FX Poland.

                  (iv)   Transaction   Expenses.   All  third  party  legal  and
         accounting expenses of Apache and FX Energy relating to the negotiation
         and  execution  of  the  Definitive  Agreement  for  the  Zielona  Gora
         transaction  will be  shared  by Apache  and FX  Energy  regardless  of
         whether a  Definitive  Agreement is  executed.  Each  party's  share of
         expenses will be based upon each party's participation  interest in the
         Zielona Gora transaction  following FX Energy's exercise of its option.
         Apache will  provide FX Energy with copies of the  invoices  from third
         parties upon  receipt,  and promptly pay the  invoices.  FX Energy will
         reimburse  Apache for the third  party  legal and  accounting  expenses
         within  thirty  days  after  the  first to occur  of:  (i) FX  Energy's
         exercise  of its  option  to  own  an  interest  in  the  Zielona  Gora
         transaction,  or (ii) the termination of the Interim Funding Agreement.
         In the event the Interim Funding Agreement is terminated, Apache and FX
         Energy  will  share  the third  party  legal  and  accounting  expenses
         equally.

                  (v) Partnership  Agreement.  The  Partnership  Agreement to be
         filed of record for the Apache/FX  Energy spolka jawna (the  "Apache/FX
         Partnership")  in the Zielona Gora  transaction  will provide that: (a)
         the Apache/FX  Partnership can be bound only with the signatures of two
         members of management,  one from Apache and one from FX Energy;  (b) it
         will   have  at  least  two   representatives   at   meetings   of  the
         POGC/Apache/FX   Energy   spolka   komandvtowa   (the   "Zielona   Gora
         Partnership"),  at least  one  from FX  Energy  and at  least  one from
         Apache;  and (c) each  representative  will  vote in the  Zielona  Gora
         Partnership in accordance with the consensus mechanism at the Apache/FX
         Partnership level.

         The  term  "Closing  '  means  the  consummation  of the  Zielona  Gora
transaction,  which will take place following the  satisfaction or waiver of the
conditions  precedent set forth in the definitive  documentation for the Zielona
Gora transaction.

         2. Future Well Carries.  FX Energy hereby  acknowledges and agrees that
Apache has satisfied all of its seismic and drilling obligations to FX Energy in
Poland  other than as set forth in this  paragraph.  Apache will carry FX Energy
in: (i) five wells located  within the parties'  Area of Mutual  Interest and in
which both Apache and FX Energy participate (the "Carried Wells"),  and (ii) 350
kilometers  of seismic in Blocks 410,  411,  412,  413, 414, 415, 430, 431, 432,
433, 452, and 453 (the

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<PAGE>

"Carpathian  Blocks").  Each of the Carried  Wells will be drilled at a mutually
agreeable  location and to a depth sufficient to test  Carboniferous or Devonian
or  deeper  formations,  estimated  at a depth of 2,000  to 3,000  meters.  If a
proposed Carried Well is a well required to satisfy a minimum work obligation of
either the Lublin Blocks  (defined below) or Carpathian  Blocks,  then FX Energy
will be  required  to elect to be carried  in that well.  In the event a well is
proposed  outside of the Lublin or  Carpathian  Blocks,  FX Energy will have the
right to elect to be carried in such well,  provided  that  Apache and FX Energy
agree that such well is substantially equivalent to the wells previously drilled
in Poland in terms of cost and depth.

         The  commitments  set forth in the previous  paragraph  are intended to
supersede  Apache's obligations  to drill ten  exploratory  wells within certain
specified time periods, as more fully described in the following Agreements:

                  (i) Lublin Participation  Agreement.  Participation  Agreement
         dated as of April 16, 1997 between Apache Overseas, Inc. and FX Energy,
         Inc. pertaining to the Lublin Area Concessions;

                  (ii)   Carpathian   Participation   Agreement.   Participation
         Agreement dated as of February 27, 1998 between Apache  Overseas,  Inc.
         and FX Energy, Inc.  pertaining to the Western Carpathian  Concessions;
         and

                  (iii) Global Agreement. Agreement dated as of January 1, 1999'
         between Apache Overseas, Inc. and FX Energy, Inc. pertaining to Oil and
         Gas Operations in Poland.

         FX Energy will pay its share of geological and geophysical costs in the
Carpathian  Blocks  commencing  on the later of (i) January 1, 2001, or (ii) the
completion of the 350 kilometer  seismic  acquisition  program in the Carpathian
Blocks.

         The term "Lublin Blocks", as used in this Section 2, means the Komarow,
Lublin, Ciecierzyn (which is Block 298), and Vistula Blocks.

         3. Wilga Appraisal  Well(s).  FX Energy will have the option either (i)
to be  carried in the Wilga  appraisal  well(s),  or (ii) pay its  participation
interest share of the Wilga appraisal well(s).  Such option will be exercised no
later than 60 days  following  the initial cash call for each well. If FX Energy
elects to be carried  on the  appraisal  well(s),  such well(s)  will be used to
satisfy the well carry(ies) defined in Section 2 above.

         4. Lublin Project Area. FX Energy hereby  acknowledges  and agrees that
Apache has satisfied its obligations to date under the usufructs  concerning the
acquisition  and  reprocessing  of seismic and the  drilling of wells within the
Komarow,  Lublin,  Ciecierzyn  (which is Block  298),  and  Vistula  Blocks (the
"Lublin  Project  Area"),  and the parties  will  relinquish  the entire  Lublin
Project Area with the exception of Blocks 255, 275 and 297.

         5. Lachowice  Project Area.  Apache and FX Energy will formally  notify
POGC that Apache and FX Energy do not wish to proceed with further operations in
the Lachowice area.

         6.  Poland  Overhead.  Beginning  July 1, 2000,  FX Energy will pay its
share of  overhead  incurred,  which  shall be  prorated  based on the number of
carried  wells  completed as a percentage  of the total carry  commitment of ten
wells,  excluding  Zielona Gora.  The term  "overhead"  means the direct

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<PAGE>

charges  authorized by Article II of the Accounting  Procedure [Exhibit A to the
Joint Operating  Agreement Covering Oil and Gas Operations in Poland (the "Joint
Operating  Agreement")],  which are identified in the Work Program and Budget as
"G&A."  The  amounts  of G&A are  based  upon the  amount  of  capital  spent on
individual  projects in relation to total capital spent. G&A shall be reduced by
any payments  received by Apache as Operator  from POGC and others in the nature
of direct or indirect charges.

         7. Award of Contract to Geofizyka  Torun.  Apache and FX Energy  hereby
approve  the award of a modified  seismic  acquisition  program  (the  "Modified
Seismic  Program")  for Blocks 85, 86, 87, 88, 89, 105,  108,  109, 129, and 149
(the  "Pomeranian  Blocks") and Blocks 211,  212,  213, 214, 231, 232, 233, 234,
251, 252, 253, 254, and 274 (the "Warsaw West Blocks") to Geofizyka  Torun Sp. z
o.o. ("Geofizyka Torun").  Apache and FX Energy will each further evidence their
approval by executing an Authorization for Expenditure  ("AFE") for the Modified
Seismic  Program in the form of Appendix  "A"  attached  hereto,  as required by
Article 6.6 of the Joint Operating Agreement. FX Energy will use one of its five
remaining Carried Wells to offset its  participation  interest share of the cost
of the Modified Seismic Program.

         The Modified  Seismic Program consists of the acquisition of 2D seismic
data covering: (i) 300 kilometers of seismic lines within the Pomeranian Blocks;
and (ii) 422  kilometers  of seismic  lines within the Warsaw West  Blocks.  For
purposes of  determining  the allocation of G&A, the Carried Well that FX Energy
has elected to use will be deemed  completed upon the conclusion of the Modified
Seismic Program.  If Apache and FX Energy elect to acquire additional seismic in
excess of the amounts  described above for the Modified Seismic Program,  Apache
and FX Energy will share the cost of the additional seismic equally.

         8. 2000 Work Program and Budget.  In accordance  with Article 6.1(B) of
the Joint  Operating  Agreement,  Apache and FX Energy  hereby  approve the Work
Program and Budget for the calendar  year  commencing on January 1, 2000, in the
form attached hereto as Appendix "B."

         9. Outstanding Amounts for Seismic Acquisition. FX Energy hereby agrees
to pay Apache the sum of U.S. $37,000 to settle the dispute arising from charges
incurred during the acquisition of seismic data by Geofizyka Krakow. FX Energy's
payment of this  settlement  amount  shall not be  construed  as an admission of
liability on its part in any respect. Payment shall be made within five business
days of the execution of this Agreement.

         10.      Miscellaneous.

                  (i) Governing  Law. This  Agreement  shall be governed by, and
         construed  and enforced in  accordance  with,  the laws of the State of
         Texas  without  regard to any  conflict of law rules that would  direct
         application of the laws of another jurisdiction.

                  (ii) Severability.  This Agreement is severable,  such that if
         any provision of this Agreement is prohibited or  unenforceable  in any
         jurisdiction  such  provision  shall,  as  to  such  jurisdiction,   be
         ineffective  to the  extent  of such  prohibition  or  unenforceability
         without  invalidating  the remaining  portions  hereof or affecting the
         validity or enforceability of such provision in any other jurisdiction.

                                       4
<PAGE>

                  (iii)  Counterparts.  This Agreement may be executed in one or
         more counterparts,  each of which shall be deemed an original,  but all
         of which together shall constitute one and the same instrument.

                  (iv) Amendments and Prior Agreements.  This Agreement shall be
         effective  when signed by the parties and may not be amended,  modified
         or assigned except by an instrument  executed by all of the parties. To
         the  extent  of any  conflicts  or  inconsistencies,  and  only to such
         extent,  this Agreement  supersedes all prior agreements between Apache
         and FX Energy.

                  (v)  Assignments.  This  Agreement is binding upon the parties
         and their respective successors and assigns; provided that no party may
         assign or transfer  any of its rights or delegate  any of its duties or
         obligations under this Agreement without the prior consent of the other
         parties.

         IN  WITNESS  whereof  this  Agreement  has  been  signed  by  the  duly
authorized  representatives  of the  parties as of the day and year first  above
written.

APACHE OVERSEAS, INC.

By: /s/ W. Steven Farris
    -------------------------------
     W. Steven Farris
     Vice Chairman of the Board

FX ENERGY, INC.

By: /s/ David N. Pierce
    -----------------------
     David N. Pierce
     President and Chief Executive Officer

                                       5

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