Exhibit 10.66

NOTICE OF CONFIDENTIALITY RIGHTS: IF YOU ARE A NATURAL PERSON, YOU MAY REMOVE OR
STRIKE ANY OR ALL OF THE FOLLOWING INFORMATION FROM ANY INSTRUMENT THAT
TRANSFERS AN INTEREST IN REAL PROPERTY BEFORE IT IS FILED FOR RECORD IN THE
PUBLIC RECORDS: YOUR SOCIAL SECURITY NUMBER OR YOUR DRIVER’S LICENSE NUMBER.

NOTICE: THIS INSTRUMENT SECURES, INTER ALIA, OBLIGATIONS THAT PROVIDE FOR A
VARIABLE RATE OF INTEREST AND OBLIGATORY FUTURE ADVANCES. ALL SUCH OBLIGATORY
FUTURE ADVANCES SHALL HAVE THE SAME LIEN PRIORITY AS IF MADE ON THE DATE HEREOF.
[SEE THE FOLLOWING DEED OF TRUST FOR PARTICULARS.]

HC-5101 MEDICAL DRIVE, LLC,

a Delaware limited liability company,

as Grantor

to

GARY S. FARMER,

as Trustee

for the benefit of

KEYBANK NATIONAL ASSOCIATION,

a national banking association,

as Agent,

as Beneficiary

LEASEHOLD DEED OF TRUST, SECURITY AGREEMENT AND ASSIGNMENT OF LEASES AND RENTS

Dated:                          As of November 27, 2013

Property Address:       5101 Medical Drive

                                     San Antonio, Texas

Location:                     Bexar County, Texas

WHEN RECORDED, RETURN TO:

McKenna Long & Aldridge LLP

303 Peachtree Street, N.E., Suite 5300

Atlanta, Georgia 30308

Attention: William F. Timmons, Esq.

ATTENTION: COUNTY CLERK – THIS INSTRUMENT COVERS GOODS THAT ARE OR ARE TO BECOME
FIXTURES ON THE REAL PROPERTY DESCRIBED HEREIN AND IS TO BE FILED FOR RECORD IN
THE RECORDS WHERE DEEDS OF TRUST ON REAL ESTATE ARE RECORDED. ADDITIONALLY, THIS
INSTRUMENT SHOULD BE APPROPRIATELY INDEXED, NOT ONLY AS A DEED OF TRUST, BUT
ALSO AS A FINANCING STATEMENT COVERING GOODS THAT ARE OR ARE TO BECOME FIXTURES
ON THE REAL PROPERTY DESCRIBED HEREIN. THE MAILING ADDRESSES OF GRANTOR (DEBTOR)
AND AGENT (SECURED PARTY) ARE SET FORTH IN THIS INSTRUMENT. THIS DOCUMENT SERVES
AS A FIXTURE FILING UNDER SECTION 9.502 OF THE TEXAS BUSINESS AND COMMERCE CODE.

Grantor’s Organizational Identification Number: 5412317.

--------------------------------------------------------------------------------

THIS LEASEHOLD DEED OF TRUST, SECURITY AGREEMENT AND ASSIGNMENT OF LEASES AND
RENTS (this “Instrument”) is made and entered into as of this 27th day of
November, 2013, by and among HC-5101 MEDICAL DRIVE, LLC, a Delaware limited
liability company (“Grantor”), having a mailing address of 4211 W. Boy Scout
Boulevard, Tampa, Florida 33607, GARY S. FARMER, as trustee (“Trustee”), having
a business address of c/o Heritage Title Company of Austin, Inc., 401 Congress
Avenue, Suite 1500, Austin, Texas 78701, and KEYBANK NATIONAL ASSOCIATION, a
national banking association (“KeyBank”), having a mailing address of 4910
Tiedeman Road, 3rd Floor, Brooklyn, Ohio 44144, Attn: Real Estate Capital
Services, with a copy to KeyBank National Association, 1200 Abernathy Road,
N.E., Suite 1550, Atlanta, Georgia 30328, Attn: Daniel Stegemoeller, as Agent
(KeyBank, in its capacity as Agent, is hereinafter referred to as “Agent”) for
itself and each other lender (collectively, the “Lenders”) which is or may
hereafter become a party to that certain First Amended and Restated Credit
Agreement, dated as of November 19, 2012, by and among Carter/Validus Operating
Partnership, LP, a Delaware limited partnership (“Borrower”), KeyBank, as Agent
and the Lenders, as amended by that certain First Amendment to First Amended and
Restated Credit Agreement and Amendment to Unconditional Guaranty of Payment and
Performance, dated as of March 15, 2013 (the “March 15 Amendment”), that certain
Second Amendment to First Amended and Restated Credit Agreement dated as of
June 11, 2013 and that certain Third Amendment to First Amended and Restated
Credit Agreement and Amendment to Other Loan Documents, dated as of August 9,
2013 (the “August 9 Amendment”) (as the same may be further varied, amended,
restated, renewed, consolidated, extended or otherwise supplemented from time to
time, the “Credit Agreement”). Capitalized terms used herein that are not
otherwise defined herein shall have the meanings set forth in the Credit
Agreement. Grantor is a Guarantor and will benefit from the Credit Agreement, as
more fully set forth in the Guaranty (as hereinafter defined) executed by
Grantor, and is granting this Instrument in consideration for such benefit.

W I T N E S S E T H:

FOR AND IN CONSIDERATION of the sum of Ten and No/100 Dollars ($10.00) and other
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, and in order to secure the indebtedness and other obligations of
Grantor and Borrower hereinafter set forth, Grantor does hereby GRANT, BARGAIN,
SELL, CONVEY, ASSIGN, TRANSFER and SET OVER UNTO Trustee, with GENERAL WARRANTY
in trust WITH POWER OF SALE, for the benefit of Agent and for the ratable
benefit of the Lenders and the holders of the Hedge Obligations, and their
successors and assigns, all of Grantor’s right, title and interest in and to the
following described land and interests in land, estates, easements, rights,
improvements, property, fixtures, equipment, furniture, furnishings, appliances,
general intangibles, and appurtenances, whether now or hereafter existing or
acquired (collectively, the “Property”):

(a) The leasehold interests, leasehold estates and all right of Grantor
(including without limitation, all renewal or purchase options, if any) in and
to all those tracts or parcels of land and easements more particularly described
on Exhibit “A” attached hereto and by this reference made a part hereof (the
“Land”), created pursuant to that certain Lease Agreement dated as of
February 17, 1987, between The San Antonio Medical Foundation, a Texas nonprofit
corporation, as landlord (“Lessor”), and The Warm Springs Rehabilitation
Foundation, Inc., a Texas nonprofit corporation, as tenant, recorded in Volume
4070, Page 70 of the Official Public

 

1

--------------------------------------------------------------------------------

Records of Bexar County, Texas, as amended by that certain First Amendment to
Lease Agreement and Access Easement Agreement dated as of September 25, 2000
between Lessor and The Warm Springs Rehabilitation Foundation, Inc., a Texas
nonprofit corporation, recorded in Volume 8609, Page 1533 of the aforementioned
records, as further amended by that certain Second Amendment to Lease Agreement
and Access Easement Agreement dated as of December 1, 2006 between Lessor and
The Warm Springs Rehabilitation Foundation, Inc., a Texas nonprofit corporation,
recorded as Document No. 20060297650 in the aforementioned records, as assigned
by that certain Assignment and Assumption of Ground Lease dated as of
December 1, 2006 between The Warm Springs Rehabilitation Foundation, Inc., a
Texas nonprofit corporation, as assignor, and MPT Of Warm Springs, L.P., a
Delaware limited partnership, as assignee, recorded as Document No. 20060297650
in the aforementioned records, as affected by that certain Estoppel Certificate
dated as of December 1, 2006 by Lessor, recorded as Document No. 20070080986 in
the aforementioned records, as assigned by that certain Assignment and
Assumption of Ground Lease and Easement Agreement dated as of even date herewith
between MPT of Warm Springs, L.P., a Delaware limited partnership, as assignor,
and Post Acute Medical at San Antonio, LLC, a Delaware limited liability
company, as assignee, recorded on or about the date hereof in the aforementioned
records, as assigned to Grantor pursuant to that certain Assignment and
Assumption of Ground Lease Agreement dated as of even date herewith between Post
Acute Medical at San Antonio, LLC, a Delaware limited liability company, as
assignor, and Grantor, as assignee, recorded on or about the date hereof in the
aforementioned records, and as further amended by that certain Third Amendment
to Lease Agreement and Access Easement Agreement dated as of even date herewith
between Lessor and Grantor, recorded on or about the date hereof in the
aforementioned records (as the same may have been or may hereafter be assigned,
amended, restated, replaced, supplemented or otherwise modified from time to
time, the “Ground Lease”), and all rights, benefits, privileges, and interests
of Grantor in and to the Ground Lease and all modifications, extensions,
renewals, and replacements thereof, and all deposits, credits, options,
privileges, and rights of Grantor as tenant under the Ground Lease, together
with all of the easements, rights, privileges, franchises, tenements,
hereditaments and appurtenances now or hereafter thereunto belonging or in any
way appertaining thereto, and all of the estate, right, title, interest, claim
and demand whatsoever of Grantor therein or thereto, either at law or in equity,
in possession or in expectancy, now or hereafter acquired including, but not
limited to, the right, if any, to renew or extend the Ground Lease for a
succeeding term or terms, and also including all the right, title, claim or
demand whatsoever of Grantor either in law or in equity, in possession or
expectancy, of, in and to Grantor’s right, as tenant under the Ground Lease, to
elect under Section 365(h)(1) of Title 11 U.S.C.A. §101 et seq. and the
regulations adopted and promulgated thereto (as the same may be amended from
time to time, the “Bankruptcy Code”) or any other creditors rights law to
terminate or treat the Ground Lease as terminated or to consent to the transfer
of the Lessor’s interest in the Land and the Improvements free and clear of the
Ground Lease under Section 363 of the Bankruptcy Code or under any other
creditors rights law in the event (i) of any bankruptcy or other debtor relief
proceeding of the Lessor, and (ii) (A) the rejection of the Ground Lease by such
Lessor, as debtor in possession, or by a trustee for such Lessor, pursuant to
Section 365 of the Bankruptcy Code or under any other creditors rights law or
(B) any attempt by such Lessor, as debtor in possession, or by a trustee for
such Lessor, to transfer such Lessor’s interest in the Land and the Improvements
under Section 363 of the Bankruptcy Code or under any other creditors rights
law.

 

2

--------------------------------------------------------------------------------

(b) All present and future buildings, structures, parking areas, annexations and
improvements of every nature whatsoever now or hereafter situated on the Land
(hereinafter referred to as the “Improvements”) and all materials intended for
construction, reconstruction, alteration and repairs of the Improvements now or
hereafter erected, all of which materials shall be deemed to be included within
the Improvements immediately upon the delivery thereof to the Land, and all gas
and electric fixtures, radiators, heaters, engines and machinery, boilers,
ranges, elevators and motors, plumbing and heating fixtures, incinerating,
sprinkling, and waste removal systems, carpeting and other floor coverings, fire
extinguishers and any other safety equipment required by governmental regulation
or law, washers, dryers, water heaters, mirrors, mantels, air conditioning
apparatus, refrigerating plants, refrigerators, cooking apparatus and
appurtenances, storm windows and doors, window and door screens, awnings and
storm sashes, which are or shall be owned by Grantor and attached to said
Improvements and all other furnishings, furniture, glassware, tableware,
uniforms, linen, drapes and curtains and related hardware and mounting devices,
wall to wall carpeting, radios, lamps, telephone systems, televisions and
television systems, computer systems, guest ledgers, vehicles, fixtures,
machinery, equipment, apparatus, appliances, books and records, chattels,
inventory, accounts, farm products, consumer goods, general intangibles and
personal property of every kind and nature whatsoever now or hereafter owned by
Grantor and located in, on or about, or used or intended to be used with or in
connection with the use, operation or enjoyment of the Property, including all
extensions, additions, improvements, betterments, after-acquired property,
renewals, replacements and substitutions, or proceeds from a permitted sale of
any of the foregoing, together with the benefit of any deposits or payments now
or hereafter made by Grantor or on behalf of Grantor, all of which are hereby
declared and shall be deemed to be fixtures and accessions to the Land and a
part of the Property as between the parties hereto and all persons claiming by,
through or under them, and which shall be deemed to be a portion of the security
for the indebtedness herein described and to be secured by this Instrument.

(c) All easements, access rights, rights-of-way, strips and gores of land,
vaults, streets, ways, alleys, passages, sewer rights, waters, water courses,
water rights and powers, irrigation systems (including, without limitation,
underground wiring, pipes, pumps and sprinkler heads), minerals, flowers,
plants, shrubs, crops, trees, timber, fences, signs, bridges, fountains,
monuments and other emblements now or hereafter located on the Land or under or
above the same or any part or parcel thereof, and all estates, rights, titles,
interests, privileges, liberties, servitudes, licenses, tenements, hereditaments
and appurtenances, reversion and reversions, remainder and remainders,
whatsoever, in any way belonging, relating or appertaining to the Land or any
part thereof, or which hereafter shall in any way belong, relate or be
appurtenant thereto, whether now owned or hereafter acquired by Grantor.

(d) All leases and all subleases, tenancies, occupancies and licenses, whether
oral or written (collectively, the “Leases”), and all income, rents, issues,
profits, room rentals, transient or guest payments, fees, charges or other
payments for the use or occupancy of rooms or other facilities, and revenues of
the Property from time to time accruing (including, without limitation, all
payments under Leases, all guarantees of the foregoing or letters of credit
relating to the foregoing, lease termination payments, proceeds of insurance,
condemnation payments, tenant security, damage or other deposits whether held by
Grantor or in a trust account, all escrow agreements relating to any of the
Leases, escrow funds, including, without limitation, any funds escrowed for
tenant improvements, fees, charges, rents, license fees, accounts, royalties,
security,

 

3

--------------------------------------------------------------------------------

damage or other deposits from time to time accruing, all payments under working
interests, production payments, royalties, overriding royalties, operating
interests, participating interest and other such entitlements, and all the
estate, right, title, interest, property, possession, claim and demand
whatsoever at law, as well as in equity, of Grantor of, in and to the same
(collectively, the “Revenues”); reserving only the right to Grantor to collect
the same (other than lease termination payments, insurance proceeds and
condemnation payments) so long as no Event of Default has occurred and is
continuing.

(e) All insurance policies, building service, building maintenance,
construction, development, management, indemnity, and other similar agreements
and contracts and subcontracts, written or oral, express or implied, now or
hereafter entered into, arising or in any manner related to the purchase,
construction, design, improvement, use, operation, ownership, occupation,
enjoyment, sale, conversion or other disposition (voluntary or involuntary) of
the Property, or the buildings and improvements now or hereafter located
thereon, or any other interest in the Property, or any combination thereof,
franchise agreements, property management agreements, cable television
agreements, contracts for the purchase of supplies, telephone service
agreements, yellow pages or other advertising agreements, sales contracts,
construction contracts, architects agreements, general contract agreements,
design agreements, engineering agreements, technical service agreements, sewer
and water and other utility agreements, service contracts, agreements relating
to the collection of receivables or use of customer lists, all bookings and
reservations for space or facilities within the Property, all purchase options,
option agreements, rights of first refusal, contract deposits, earnest money
deposits, prepaid items and payments due and to become due thereunder, and
further including all payment and performance bonds, labor, deposits,
assurances, construction guaranties, guaranties, warranties, indemnities and
other undertakings, architectural plans and specifications, drawings, surveys,
soil reports, engineering reports, inspection reports, environmental audits and
other technical descriptions and reports relating to the Property, renderings
and models, permits, consents, approvals, licenses, variances, agreements,
contracts, building permits, purchase orders and equipment leases, personal
property leases, and all causes of action relating thereto.

(f) All deposit accounts, instruments, accounts receivable, documents, causes of
action, claims, names by which the Property or the improvements thereon may be
operated or known, all rights to carry on business under such names, all
telephone numbers or listings, all rights, interest and privileges of which
Grantor may have in any capacity under any covenants, restrictions or
declarations now or hereafter relating to the Property or the Improvements, and
all notes or chattel paper now or hereafter arising from or by virtue of any
transactions relating to the Property or the Improvements located thereon and
all customer lists, other lists, and business information relating in any way to
the Property or the Improvements or the use thereof, whether now owned or
hereafter acquired;

(g) All assets related to the ownership or operation of the Property or the
Improvements now or hereafter erected thereon, including, without limitation,
accounts (including, without limitation, health-care-insurance receivables),
chattel paper (whether tangible or electronic), deposit accounts, documents,
general intangibles (including, without limitation, payment intangibles, and all
current and after acquired copyrights, copyright rights, advertising materials,
web sites, and web pages, software and software licenses, trademarks and service
marks, trademark rights, trademark applications, service mark rights, service
mark applications,

 

4

--------------------------------------------------------------------------------

trade dress rights, company names, logos, and all domain names, owned or used in
connection with the Grantor’s business, and in each case all goodwill associated
therewith), goods (including, without limitation, inventory, property,
possessions, equipment, fixtures and accessions), instruments (including,
without limitation, promissory notes), investment property, letter-of-credit
rights, letters of credit, money, supporting obligations, as-extracted
collateral, timber to be cut and all proceeds and products of anything described
or referred to above in this Subsection (g), in each case as such terms are
defined under the Uniform Commercial Code as in effect in the applicable
jurisdiction.

(h) All cash funds, deposit accounts and other rights and evidence of rights to
cash, now or hereafter created or held by Trustee or Agent pursuant to this
Instrument, the Credit Agreement or any other of the Loan Documents.

(i) All proceeds, products, substitutions and accessions of the foregoing of
every type.

TO HAVE AND TO HOLD the Property and all parts, rights, members and
appurtenances thereof, to the Trustee, for the use, benefit and behoof of Agent
for the ratable benefit of the Lenders and the holders of the Hedge Obligations
and their respective successors and assigns, IN FEE SIMPLE forever; and Grantor
covenants that Grantor is lawfully seized and possessed of the Property as
aforesaid, and has good right to convey its indefeasible leasehold interest in
the Land, that the same is unencumbered except for those matters expressly set
forth in Exhibit “B” attached hereto and by this reference made a part hereof
(the “Permitted Encumbrances”), and that Grantor does warrant and will forever
defend the title thereto against the claims of all persons whomsoever, except as
to those matters set forth in said Exhibit “B” attached hereto, or otherwise
specifically approved by Agent in writing after the date hereof.

IN TRUST NEVERTHELESS to secure the following described obligations
(collectively, the “Secured Obligations”):

(a) The debt evidenced by (i) those certain Amended and Restated Term Loan Notes
made by Borrower in the aggregate principal amount of Fifty-Five Million and
No/100 Dollars ($55,000,000.00) to the order of the Term Loan Lenders, each of
which has been issued pursuant to the Credit Agreement and is due and payable in
full on or before August 9, 2017, unless extended as provided in the Credit
Agreement, and which evidence a term loan in the initial principal amount of up
to $55,000,000.00 which may be increased pursuant to Section 2.11 of the Credit
Agreement, (ii) those certain Amended and Restated Revolving Credit Notes made
by Borrower in the aggregate principal amount of One Hundred Seventy Million and
No/100 Dollars ($170,000,000.00) to the order of the Revolving Credit Lenders,
each of which has been issued pursuant to the Credit Agreement and is due and
payable in full on or before August 9, 2016, unless extended as provided in the
Credit Agreement, and which evidence a revolving credit loan in the initial
principal amount of up to $170,000,000.00 which may be increased pursuant to
Section 2.11 of the Credit Agreement, (iii) that certain Amended and Restated
Swing Loan Note made by Borrower in the principal amount of Ten Million and
No/100 Dollars ($10,000,000.00) to the order of KeyBank, which has been issued
pursuant to the Credit Agreement and is due and payable in full on or before
August 9, 2016, unless extended as provided in the Credit Agreement, and which
evidences a swing loan in the initial principal

 

5

--------------------------------------------------------------------------------

amount of up to $10,000,000.00, and (iv) each other note as may be issued under
the Credit Agreement, including, without limitation, to reflect any increase of
the term loan described herein (which is due and payable on or before August 9,
2017, unless extended as provided in the Credit Agreement), the revolving credit
loan or the swing loan described herein (each of which is due and payable on or
before August 9, 2016, unless extended as provided in the Credit Agreement),
each as originally executed, or if varied, extended, supplemented, consolidated,
amended, replaced, renewed, modified or restated from time to time as so varied,
extended, supplemented, consolidated, amended, replaced, renewed, modified or
restated; provided, however, that the maximum principal indebtedness under the
promissory notes described in clauses (i) through (iv) above shall not exceed
the aggregate amount of Three Hundred Fifty Million and no/100 Dollars
($350,000,000.00) (collectively, the “Note”);

(b) The payment, performance and discharge of each and every obligation,
covenant and agreement of Grantor contained herein or of Grantor contained in
that certain Unconditional Guaranty of Payment and Performance by Grantor and
others in favor of KeyBank, as Agent for itself and each other Lender, dated as
of March 30, 2012, as amended by that certain First Amendment to Unconditional
Guaranty of Payment and Performance, dated as of June 29, 2012, that certain
Second Amendment to Unconditional Guaranty of Payment and Performance dated as
of July 19, 2012, that certain Omnibus Amendment of Loan Documents dated as of
November 19, 2012, the March 15 Amendment and the August 9 Amendment (as
amended, restated, modified, renewed, supplemented or extended from time to
time, the “Guaranty”), of Borrower contained in the Credit Agreement, and of
Grantor and Borrower in the other Loan Documents, including, without limitation,
the obligation of Borrower to reimburse Issuing Lender for any draws under the
Letters of Credit;

(c) Any and all additional advances made by Agent or any Lender to protect or
preserve the Property or the lien and security title hereof in and to the
Property, or for taxes, assessments or insurance premiums as hereinafter
provided (whether or not Grantor is the owner of the Property at the time of
such advances);

(d) The payment, performance and discharge of each and all of the Hedge
Obligations (as defined in the Credit Agreement);

(e) Any and all other indebtedness now or hereafter owing by Borrower to Agent
or any Lender pursuant to the terms of the Credit Agreement, whether now
existing or hereafter arising or incurred, however evidenced or incurred,
whether express or implied, direct or indirect, absolute or contingent, due or
to become due, including, without limitation, all principal, interest, fees,
expenses, yield maintenance amounts and indemnification amounts, and all
renewals, modifications, consolidations, replacements and extensions thereof;
and

(f) All costs and expenses incurred by the Trustee, Agent, the Lenders and the
holders of the Hedge Obligations in connection with the enforcement and
collection of the Secured Obligations, including, without limitation, all
attorneys’ fees and disbursements, and all other such costs and expenses
described in and incurred pursuant to the Note, the Credit Agreement, the
Guaranty, this Instrument, and the other Loan Documents and the agreements
evidencing or relating to the Hedge Obligations (the “Hedge Documents”)
(collectively, the “Enforcement Costs”).

 

6

--------------------------------------------------------------------------------

Notwithstanding anything to the contrary contained herein, under no
circumstances shall the Secured Obligations include any obligation that
constitutes an Excluded Hedge Obligation (as defined in the Credit Agreement) of
the Grantor. Subject to Section 2.22 hereof, should the Secured Obligations
secured by this Instrument be paid and performed according to the terms and
effect thereof when the same shall become due and payable, and should Grantor
perform all covenants contained herein in a timely manner and the obligation of
the Lenders to make Loans and issue Letters of Credit under the Credit Agreement
has terminated, then this Instrument shall be released.

Grantor hereby further covenants and agrees with Trustee and Agent as follows:

ARTICLE 1

1.01 Payment of Secured Obligations. Grantor will pay and perform or cause to be
paid and performed the Secured Obligations according to the tenor thereof and
all other sums now or hereafter secured hereby as the same shall become due.

1.02 Funds for Impositions. After the occurrence and during the continuance of
an Event of Default, Grantor shall pay to Agent, subject to Agent’s option under
Section 1.03 hereof, on the days that monthly installments of interest are
payable under the Note, until the Note is paid in full, a sum (hereinafter
referred to as the “Funds”) reasonably estimated by Agent to provide an amount
necessary for payment of the following items in full fifteen (15) days prior to
when such items become due (hereinafter collectively referred to as the
“Impositions”): (a) the yearly real estate taxes, ad valorem taxes, personal
property taxes, assessments and betterments, and (b) the yearly premium
installments for the insurance covering the Property and required by the Credit
Agreement. The Impositions shall be reasonably estimated initially and from time
to time by Agent on the basis of assessments and bills and estimates thereof.
The Funds shall be held by Agent in a separate interest bearing account free of
any liens or claims on the part of other creditors of Grantor and as part of the
security for the Secured Obligations. Grantor shall pay all Impositions prior to
delinquency as required by Section 1.03 hereof. In the event Agent elects to
reserve Funds as permitted under this Section 1.02, within ten (10) days after
Grantor furnishes Agent with reasonably satisfactory evidence that Grantor has
paid one or more of the items comprising the Impositions, Agent shall reimburse
Grantor (or the one paying the Impositions) therefor to the extent of the Funds
(plus accrued interest) then held by Agent. Alternatively, Agent shall apply the
Funds to pay the Impositions with respect to which the Funds were paid to the
extent of the Funds then held by Agent and provided Grantor has delivered to
Agent the assessments or bills therefor. Grantor shall be permitted to pay any
Imposition early in order to take advantage of any available discounts. Agent
shall make no charge for so holding and applying the Funds or for verifying and
compiling said assessments and bills. The Funds are pledged as additional
security for the Secured Obligations, and may be applied, at Agent’s option and
without notice to Grantor, to the payment of the Secured Obligations upon the
occurrence of any Event of Default. If at any time the amount of the Funds held
by Agent shall be less than the amount reasonably deemed necessary by Agent to
pay Impositions as such become due, Grantor shall pay to Agent any amount
necessary to make up the deficiency within fifteen (15) business days after
notice from Agent to Grantor requesting payment thereof. Upon payment and
performance in full of the Secured Obligations and termination of the obligation
of the Lenders to make Loans and of Issuing Lender to issue Letters of Credit,
Agent shall promptly refund to Grantor any Funds then held by Agent.

 

7

--------------------------------------------------------------------------------

1.03 Impositions, Liens and Charges. Grantor shall pay all Impositions and other
charges, if any, attributable to the Property prior to delinquency, and at
Agent’s option during the continuance of an Event of Default, Grantor shall pay
in the manner hereafter provided under this Section 1.03. Grantor shall, during
continuance of an Event of Default, furnish to Agent all bills and notices of
amounts due under Section 1.03 as soon as received, and in the event Grantor
shall make payment directly, Grantor shall, as and when available, furnish to
Agent receipts evidencing such payments prior to the dates on which such
payments are delinquent, subject to Grantor’s right to contest taxes,
assessments and other governmental charges as provided in the Credit Agreement.
Grantor shall promptly discharge (by bonding, payment or otherwise) any lien
filed against the Property or Grantor (including federal tax liens) and will
keep and maintain the Property free from the claims of all persons supplying
labor or materials to the Property, subject to Grantor’s right to contest the
same as provided in the Credit Agreement. Grantor shall not claim or be entitled
to any credit against the taxable value of the Property by reason of this
Instrument, or any deduction in or credit on the Secured Obligations by reason
of Impositions paid.

1.04 Taxes, Liens and Other Charges.

(a) In the event of the passage of any state, federal, municipal or other
governmental law, order, rule or regulation, subsequent to the date hereof, in
any manner changing or modifying the laws now in force governing the taxation of
debts secured by deeds of trust or the manner of collecting taxes so as to
adversely affect Agent or the Lenders, Grantor will promptly pay any such tax.
If Grantor fails to make such payment promptly, or if, in the opinion of Agent,
any such state, federal, municipal, or other governmental law, order, rule or
regulation prohibits Grantor from making such payment or would penalize Agent or
the Lenders if Grantor makes such payment or if, in the opinion of Agent, the
making of such payment could reasonably result in the imposition of interest
beyond the maximum amount permitted by applicable law, then the entire balance
of the principal sums secured by this Instrument and all interest accrued
thereon shall, at the option of Agent, become immediately due and payable.

(b) Grantor will pay all taxes, liens, assessments and charges of every
character including all utility charges, whether public or private, already
levied or assessed or that may hereafter be levied or assessed upon or against
the Property as required under the Credit Agreement.

1.05 Insurance.

Grantor shall procure for, deliver to and maintain for the benefit of Agent and
Lenders the insurance policies described in the Credit Agreement. Grantor shall
pay all premiums on such insurance policies. All proceeds of any property or
casualty insurance or awards of damages on account of any taking or condemnation
for public use of or injury to the Property are hereby assigned and shall be
paid to Agent, for the benefit of the Lenders, subject to Borrower’s and
Grantor’s right to adjust certain claims and use such proceeds as provided in
the Credit Agreement. Any such proceeds shall be released and advanced to
Borrower or Grantor in

 

8

--------------------------------------------------------------------------------

accordance with and subject to the requirements of the Credit Agreement and be
applied to the cost of repairing or restoring the Property or the remaining
portion of the Property, with any balance remaining to be applied in accordance
with the terms and provisions of the Credit Agreement. In the event of a
foreclosure sale of all or any part of the Property pursuant to the enforcement
of this Instrument, the purchaser of such Property shall succeed to all rights
of Grantor, including any rights to the proceeds of insurance and to unearned
premiums, in and to all of the policies of insurance. In the event of a
foreclosure sale, Agent is hereby authorized, without the further consent of
Grantor, to take such steps as Agent may deem advisable to cause the interest of
such purchaser to be protected by any of such policies. In case of Grantor’s
failure to keep the Property properly insured as required herein, Agent, after
notice to Grantor, at its option may (but shall not be required to) acquire such
insurance as required herein at Borrower’s and Grantor’s sole expense. TEXAS
FINANCE CODE SECTION 307.052 COLLATERAL PROTECTION INSURANCE NOTICE: (A) GRANTOR
IS REQUIRED TO (i) KEEP THE PROPERTY INSURED AGAINST DAMAGE IN THE AMOUNT
SPECIFIED IN THE CREDIT AGREEMENT; (ii) PURCHASE THE INSURANCE FROM AN INSURER
THAT IS AUTHORIZED TO DO BUSINESS IN THE STATE OF TEXAS OR AN ELIGIBLE SURPLUS
LINES INSURER OR OTHERWISE AS PROVIDED IN THE CREDIT AGREEMENT; AND (iii) NAME
AGENT AS THE PERSON TO BE PAID UNDER THE POLICY IN THE EVENT OF A LOSS AS
PROVIDED IN THE CREDIT AGREEMENT; (B) SUBJECT TO THE PROVISIONS HEREOF AND OF
THE CREDIT AGREEMENT, GRANTOR MUST, IF REQUIRED BY AGENT, DELIVER TO AGENT A
COPY OF THE POLICY AND PROOF OF THE PAYMENT OF PREMIUMS; AND (C) SUBJECT TO THE
PROVISIONS HEREOF AND OF THE CREDIT AGREEMENT, IF GRANTOR FAILS TO MEET ANY
REQUIREMENT LISTED IN THE FOREGOING SUBPARTS (A) OR (B), AGENT MAY OBTAIN
COLLATERAL PROTECTION INSURANCE ON BEHALF OF GRANTOR AT BORROWER’S AND GRANTOR’S
EXPENSE.

1.06 Condemnation. If all or any portion of the Property shall be damaged or
taken through condemnation (which term when used in this Instrument shall
include any damage or taking by any governmental authority or any transfer by
private sale in lieu thereof), either temporarily or permanently, then all
compensation, awards and other payments or relief thereof, shall be paid and
applied in accordance with terms and provisions of the Credit Agreement.

1.07 Care, Use and Management of Property.

(a) Grantor will keep, or cause to be kept, the roads and walkways, landscaping
and all other Improvements of any kind now or hereafter erected on the Land or
any part thereof in good condition and repair, will not commit or suffer any
waste, impairment or deterioration (ordinary wear and tear excepted) and will
not do or suffer to be done anything which will increase the risk of fire or
other hazard to the Property or any part thereof.

(b) Grantor will not remove or demolish nor alter the structural character of
any building located on the Land or any fixtures or personal property relating
thereto except when incidental to the replacement of fixtures and personal
property with items of like kind and value or customary tenant improvements
pursuant to Leases approved or deemed approved pursuant to the Credit Agreement.

 

9

--------------------------------------------------------------------------------

(c) If the Property or any part thereof is materially damaged by fire or any
other cause, Grantor will give immediate written notice thereof to Agent.

(d) Grantor will promptly comply with all present and future laws, ordinances,
rules and regulations of any governmental authority, all restrictive covenants
and other agreements affecting the Property or relating to the operation thereof
affecting the Property or any part thereof and all licenses or permits affecting
the Property or any part thereof, subject to Grantor’s right to contest the same
as provided in the Credit Agreement.

(e) Grantor shall keep the Property, including the Improvements and the Personal
Property (as hereinafter defined), in good order, repair and tenantable
condition and shall replace fixtures, equipment, machinery and appliances on the
Property when necessary to keep such items in good order, repair, and tenantable
condition (ordinary wear and tear excepted).

(f) Grantor shall keep all franchises, trademarks, trade names, service marks
and licenses and permits necessary for the Grantor’s use and occupancy of the
Property in good standing and in full force and effect.

(g) Unless required by applicable law or unless Agent has otherwise agreed in
writing, Grantor shall not allow changes in the nature of the occupancy or use
for which the Property was intended at the time this Instrument was executed.
Grantor shall not abandon the Property. Grantor shall not initiate, fail to
contest or acquiesce in a change in the zoning classification of the Property or
subject the Property to restrictive or negative covenants without Agent’s
written consent. Grantor shall comply with, observe and perform all zoning and
other laws affecting the Property, all agreements and restrictive covenants
affecting the Property, and all licenses and permits affecting the Property,
subject to Grantor’s right to contest compliance with laws to the extent
permitted in the Credit Agreement.

(h) To the extent permitted under the terms of the applicable Leases, Agent may,
at Grantor’s expense, make or cause to be made reasonable entries upon and
inspections of the Property as permitted in the Credit Agreement during normal
business hours and upon reasonable advance notice, or at any other time when
necessary or appropriate in an emergency circumstance or during the continuance
of an Event of Default, in the sole reasonable discretion of Agent, to protect
or preserve the Property.

(i) If all or any part of the Property shall be damaged by fire or other
casualty or loss, then, subject to the provisions of the Credit Agreement,
Grantor will promptly restore the Property to the equivalent of its original
condition; and if a part of the Property shall be damaged through condemnation,
Grantor will promptly restore, repair or alter the remaining portions of the
Property in a manner satisfactory to Agent. Notwithstanding the foregoing,
Grantor shall not be obligated to so restore unless, in each instance, Agent
agrees to make available to Grantor (subject to the terms of the Credit
Agreement) any net insurance or condemnation proceeds actually received by Agent
hereunder in connection with such casualty loss or condemnation, to the extent
such proceeds are required to defray the expense of such restoration; provided,
however, that, subject to the provisions of the Credit Agreement, the
insufficiency of any such insurance or condemnation proceeds to defray the
entire expense of restoration shall in no way relieve Grantor of its obligation
to restore.

 

10

--------------------------------------------------------------------------------

(j) Grantor shall pay all normal and customary operating expenses for the
Property as the same become due.

1.08 Leases and other Agreements Affecting Property.

(a) As additional security for the Secured Obligations, Grantor presently and
unconditionally assigns and transfers to Agent all of Grantor’s right, title and
interest in and to the Leases and the Revenues, including those now due, past
due or to become due by virtue of any of the Leases for the occupancy or use of
all or any part of the Property. Grantor hereby authorizes Agent or Agent’s
agents to collect the Revenues and hereby directs such tenants, lessees and
licensees of the Property to pay the Revenues to Agent or Agent’s agents;
provided, however, Grantor shall have a license (revocable upon the occurrence
and during the continuance of an Event of Default) to collect and receive the
Revenues. Grantor agrees that each and every tenant, lessee and licensee of the
Property may pay, and hereby irrevocably authorizes and directs each and every
tenant, lessee and licensee of the Property to pay, the Revenues to Agent or
Agent’s agents on Agent’s written demand therefor (which demand may be made by
Agent at any time after the occurrence and during the continuance of an Event of
Default) without any obligation on the part of said tenant, lessee or licensee
to inquire as to the existence of an Event of Default and notwithstanding any
notice or claim of Grantor to the contrary, and Grantor agrees that Grantor
shall have no right or claim against said tenant, lessee or licensee for or by
reason of any Revenues paid to Agent following receipt of such written demand.

(b) Grantor hereby covenants that Grantor has not executed any prior assignment
of the Leases or the Revenues, that Grantor has not performed, and will not
perform, any acts and has not executed, and will not execute, any instruments
which would prevent Agent from exercising the rights of the beneficiary of this
Instrument, and that at the time of execution of this Instrument, there has been
no anticipation or prepayment of any of the Revenues for more than one (1) month
prior to the due dates of such Revenues. Grantor further covenants that Grantor
will not hereafter collect or accept payment of any Revenues more than one
(1) month prior to the due dates of such Revenues.

(c) Grantor agrees that neither the foregoing assignment of Leases and Revenues
nor the exercise of any of Agent’s rights and remedies under this Section or
Article 2 hereof shall be deemed to make Agent a mortgagee-in-possession or
otherwise responsible or liable in any manner with respect to the Leases, the
Property or the use, occupancy, enjoyment or operation of all or any portion
thereof, unless and until Agent, in person or by agent, assumes actual
possession thereof. Grantor further agrees that the appointment of any receiver
for the Property by any court at the request of Agent or by agreement with
Grantor, or the entering into possession of any part of the Property by such
receiver, shall not be deemed to make Agent a mortgagee-in-possession or
otherwise responsible or liable in any manner with respect to the Leases, the
Property or the use, occupancy, enjoyment or operation of all or any portion
thereof.

 

11

--------------------------------------------------------------------------------

(d) If Agent exercises its rights and remedies pursuant to this Section or
Article 2 hereof, all Revenues thereafter collected shall be applied in such
order as Agent may elect in its discretion to the reasonable costs of taking
control of and managing the Property and collecting the Revenues, including, but
not limited to, reasonable attorneys’ fees actually incurred, fees, receiver
fees, premiums on receiver’s bonds, costs of repairs to the Property, premiums
on insurance policies, Impositions and other charges on the Property, and the
costs of discharging any obligation or liability of Grantor as landlord, lessor
or licensor of the Property, or to the Secured Obligations. Agent or any
receiver shall have access to the books and records used in the operation and
maintenance of the Property and shall be liable to account only for those
Revenues actually received. Agent shall not be liable to Grantor, anyone
claiming under or through Grantor or anyone having an interest in the Property
by reason of anything done or left undone by Agent pursuant to this Section or
Article 2 hereof, except in the event of Agent’s gross negligence or willful
misconduct. If the Revenues are not sufficient to meet the costs of taking
control of and managing the Property and collecting the Revenues, any monies
reasonably expended by Agent for such purposes shall become a portion of the
Secured Obligations. Unless Agent and Grantor agree in writing to other terms of
payment, such amounts shall be payable upon notice from Agent to Grantor
requesting payment thereof and shall bear interest from the date of disbursement
at the Default Rate stated in the Credit Agreement unless payment of interest at
such rate would be contrary to applicable law, in which event such amounts shall
bear interest at the highest rate which may be collected from Grantor under
applicable law. The entering upon and taking possession of and maintaining of
control of the Property by Agent or any receiver and the application of Revenues
as provided herein shall not cure or waive any Event of Default or invalidate
any other right or remedy of Agent hereunder.

(e) It is the intention of Agent and Grantor that the assignment effectuated by
this Instrument with respect to the Revenues shall be a direct and currently
effective assignment and shall not constitute merely an obligation to grant a
lien, security interest or pledge for the purpose of securing the Secured
Obligations.

(f) In the event that a court of competent jurisdiction determines that,
notwithstanding such expressed intent of the parties, Agent’s interest in the
Revenues constitutes a lien on or security interest in or pledge of the
Revenues, it is agreed and understood that the forwarding of a notice to
Borrower after the occurrence of an Event of Default advising Borrower of the
revocation of Borrower’s license to collect such Revenues, shall be sufficient
action by Agent to (i) perfect such lien on or security interest in or pledge of
the Revenues, (ii) take possession thereof and (iii) entitle Agent to immediate
and direct payment of the Revenues, for application as provided in this
Instrument, all without the necessity of any further action by Agent, including,
without limitation, any action to obtain possession of the Land, Improvements or
any other portion of the Property.

1.09 Leases of the Property.

(a) Except as permitted in the Credit Agreement, Grantor shall not enter into
any Lease of all or any portion of the Property or amend, supplement or
otherwise modify, or terminate or cancel, or accept the surrender of, or consent
to the assignment or subletting of, or grant any concessions to or waive the
performance of any obligations of any tenant, lessee or licensee under, any now
existing or future Lease of the Property, without the prior written consent of
Agent. Grantor, at Agent’s request, shall furnish Agent with executed copies of
all Leases hereafter made of all or any part of the Property. Upon Agent’s
request, Grantor shall make a separate and distinct assignment to Agent, as
additional security, of all Leases hereafter made of all or any part of the
Property.

 

12

--------------------------------------------------------------------------------

(b) There shall be no merger of the leasehold estates created by the Leases with
the fee estate or the leasehold estate of the Land without the prior written
consent of Agent. Agent may at any time and from time to time by specific
written instrument intended for the purpose, unilaterally subordinate the lien
of this Instrument to any Lease, without joinder or consent of, or notice to,
Grantor, any tenant or any other Person, and notice is hereby given to each
tenant under a Lease of such right to subordinate. No such subordination shall
constitute a subordination to any lien or other encumbrance, whenever arising,
or improve the right of any junior lienholder. Nothing herein shall be construed
as subordinating this Instrument to any Lease.

(c) Grantor hereby appoints Agent its attorney-in-fact, coupled with an
interest, empowering Agent to subordinate this Instrument to any Leases.

1.10 Security Agreement.

(a) Insofar as the machinery, apparatus, equipment, fittings, fixtures, building
supplies and materials, general intangibles and articles of personal property
either referred to or described in this Instrument, or in any way connected with
the use and enjoyment of the Property is concerned, Grantor grants unto Agent a
security interest therein and this Instrument is hereby made and declared to be
a security agreement, encumbering each and every item of personal property (the
“Personal Property”) included herein, in compliance with the provisions of the
Uniform Commercial Code as enacted in the applicable jurisdiction as set forth
in Section 3.04 below (the “UCC”). Any notification required by the UCC shall be
deemed reasonably and properly given if sent in accordance with the notice
provisions of this Instrument at least ten (10) days before any sale or other
disposition of the Personal Property. Disposition of the Personal Property shall
be deemed commercially reasonable if made pursuant to a public sale advertised
at least twice in a newspaper of general circulation in the community where the
Property is located. It shall be deemed commercially reasonable for the Trustee
and/or Agent to dispose of the Personal Property without giving any warranties
as to the Personal Property and specifically disclaiming all disposition
warranties. A financing statement or statements affecting all of said personal
property aforementioned, shall be appropriately filed. The remedies for any
violation of the covenants, terms and conditions of the security agreement
herein contained shall be (i) as prescribed herein with respect to the Property,
or (ii) as prescribed by general law, or (iii) as prescribed by the specific
statutory consequences now or hereafter enacted and specified in said UCC, all
at Agent’s sole election. Grantor and Agent agree that the filing of such
financing statement(s) in the records normally having to do with personal
property shall never be construed as in any way derogating from or impairing
this declaration and hereby stated intention of Grantor and Agent that
everything used in connection with the production of income from the Property
and/or adapted for use therein and/or which is described or reflected in this
Instrument, is to the full extent provided by law, and at all times and for all
purposes and in all proceedings both legal or equitable shall be, regarded as
part of the real estate irrespective of whether (i) any such item is physically
attached to the Improvements, (ii) serial numbers are used for the better
identification of certain items capable of being thus identified in a recital
contained herein, or (iii) any such item is referred to or reflected in any such
financing statement(s) so filed at any

 

13

--------------------------------------------------------------------------------

time. Similarly, the mention in any such financing statement(s) of the rights in
and to (1) the proceeds of any fire and/or hazard insurance policy, or (2) any
award in eminent domain proceedings for a taking or for loss of value, or
(3) Grantor’s interest as lessor in any present or future lease or rights to
income growing out of the use and/or occupancy of the Property, whether pursuant
to lease or otherwise, shall never be construed as in any way altering any of
the rights of Agent as determined by this Instrument, subject to the provisions
of the Credit Agreement, or impugning the priority of Agent’s lien granted
hereby or by any other recorded document, but such mention in such financing
statement(s) is declared to be for the protection of Agent in the event any
court shall at any time hold with respect to the foregoing (1), (2) or (3), that
notice of Agent’s priority of interest to be effective against a particular
class of persons, must be filed in the UCC records.

(b) Grantor warrants that (i) Grantor’s (that is, “Debtor’s”) correct legal name
(including, without limitation, punctuation and spacing) indicated on the public
record of Grantor’s jurisdiction of organization, identity or corporate
structure, residence or chief executive office and jurisdiction of organization
are as set forth in Subsection 1.10(c) hereof; (ii) Grantor (that is, “Debtor”)
has been using or operating under said name, identity or corporate structure
without change for the time period set forth in Subsection 1.10(c) hereof, and
(iii) the location of the Personal Property secured by this Instrument is upon
the Land (except that the books and records related to the Property may be
stored and maintained at another site). Grantor covenants and agrees that
Grantor shall not change any of the matters addressed by clauses (i) or (iii) of
this Subsection 1.10(b) unless it has given Agent thirty (30) days prior written
notice of any such change and has executed or authorized at the request of Agent
such additional financing statements or other instruments in such jurisdictions
as Agent may deem necessary or advisable in its sole discretion to prevent any
filed financing statement from becoming misleading or losing its perfected
status.

(c) The information contained in this Subsection 1.10(c) is provided in order
that this Instrument shall comply with the requirements of the Uniform
Commercial Code, as enacted in the State of Texas, for instruments to be filed
as financing statements. The names of the “Debtor” and the “Secured Party”, the
identity or corporate structure, jurisdiction of organization, organizational
number, federal tax identification number, and residence or chief executive
office of “Debtor”, and the time period for which “Debtor” has been using or
operating under said name and identity or corporate structure without change,
are as set forth in Schedule 1 of Exhibit “C” attached hereto and by this
reference made a part hereof; the mailing address of the “Secured Party” from
which information concerning the security interest may be obtained, and the
mailing address of “Debtor”, are as set forth in Schedule 2 of Exhibit “C”
attached hereto; and a statement indicating the types, or describing the items,
of Personal Property secured by this Instrument is set forth hereinabove.

(d) Exhibit “C” correctly sets forth all names and tradenames that Grantor has
used within the last five years, and also correctly sets forth the locations of
all of the chief executive offices of Grantor over the last five years.

(e) The Grantor hereby covenants and agrees that:

 

14

--------------------------------------------------------------------------------

(1) Grantor shall not merge or consolidate into, or transfer any of the Property
to, any other person or entity except as permitted under the Credit Agreement.

(2) Grantor shall, at any time and from time to time, take such steps as Agent
may reasonably request for Agent (A) to obtain an acknowledgment, in form and
substance reasonably satisfactory to Agent, of any bailee having possession of
any of the Property, stating that the bailee holds possession of such Property
on behalf of Agent, (B) to obtain “control” of any investment property, deposit
accounts, letter-of-credit rights, or electronic chattel paper (as such terms
are defined by the UCC with corresponding provisions thereof defining what
constitutes “control” for such items of collateral), with any agreements
establishing control to be in form and substance reasonably satisfactory to
Agent, and (C) otherwise to insure the continued perfection and priority of the
Agent’s security interest in any of the Property and of the preservation of its
rights therein. If Grantor shall at any time, acquire a “commercial tort claim”
(as such term is defined in the UCC) with respect to the Property or any portion
thereof, Grantor shall promptly notify Agent thereof in writing, providing a
reasonable description and summary thereof, and shall execute a supplement to
this Instrument in form and substance acceptable to Agent granting a security
interest in such commercial tort claim to Agent.

(3) Grantor hereby authorizes Agent, its counsel or its representative, at any
time and from time to time, to file financing statements, amendments and
continuations that describe or relate to the Property or any portion thereof in
such jurisdictions as Agent may deem necessary or desirable in order to perfect
the security interests granted by Grantor under this Instrument or any other
Loan Document, and such financing statements may contain, among other items as
Agent may deem advisable to include therein, the federal tax identification
number of Grantor.

(4) Grantor shall not license, lease, sell or otherwise transfer any of the
general intangibles to any third party during the term of this Instrument and
the Credit Agreement without the prior written consent of the Agent (which
consent may be withheld in the Agent’s sole discretion); and the Grantor will
continue to use all trademarks, service marks and trade names in a consistent
manner and shall take all steps necessary to properly maintain any formal
registrations on the general intangibles, and to defend and enforce them, for
the term of this Instrument and the Credit Agreement.

1.11 Further Assurances; After-Acquired Property. At any time and from time to
time, upon request by Agent, Grantor will make, execute and deliver or cause to
be made, executed and delivered, to Trustee and Agent and, where appropriate,
cause to be recorded and/or filed and from time to time thereafter to be
rerecorded and/or refiled at such time and in such offices and places as shall
be deemed desirable by Agent, any and all such other and further deeds of trust,
security agreements, financing statements, notice filings, continuation
statements, instruments of further assurance, certificates and other documents
as may, in the opinion of Agent, be necessary or desirable in order to
effectuate, complete, or perfect, or to continue and preserve (a) the obligation
of Grantor under the Guaranty, this Instrument, the other Loan Documents and the
Hedge Documents and (b) this Instrument as a first and prior lien upon and
security interest in and to all of the Property, whether now owned or hereafter
acquired by Grantor. Upon any failure by Grantor so to do, Agent may make,
execute, record, file, re-record

 

15

--------------------------------------------------------------------------------

and/or refile any and all such deeds of trust, security agreements, financing
statements, continuation statements, instruments, certificates, and documents
for and in the name of Grantor and Grantor hereby irrevocably appoints Agent the
agent and attorney-in-fact of Grantor so to do. The lien hereof will
automatically attach, without further act, to all after acquired property
attached to and/or used in the operation of the Property or any part thereof.

1.12 Expenses. Grantor will pay or reimburse Agent, upon demand therefor, for
all reasonable attorney’s fees, costs and expenses incurred by Agent in any
suit, action, legal proceeding or dispute of any kind in which Lenders, Agent,
Trustee or the holders of the Hedge Obligations is made a party or appears as
party plaintiff or defendant, affecting or arising in connection with the
Secured Obligations secured hereby, this Instrument or the interest created
herein, or the Property, including, but not limited to, the exercise of the
power of sale contained in this Instrument, any condemnation action involving
the Property or any action to protect the security hereof; and any such amounts
paid by Lenders, Agent, the holders of the Hedge Obligations or the Trustee
shall be added to the Secured Obligations secured by the lien of this
Instrument.

1.13 Subrogation. Agent shall be subrogated to the claims and liens of all
parties whose claims or liens are discharged or paid with the proceeds of the
Secured Obligations secured hereby.

1.14 Limit of Validity. If from any circumstances whatsoever fulfillment of any
provision of this Instrument, the Guaranty, the Credit Agreement, the Note, any
other Loan Document or any Hedge Document, at the time performance of such
provision shall be due, shall be subject to the defense of usury or otherwise
transcend or violate applicable law concerning interest or other charges, then
ipso facto the obligation to be fulfilled shall be reduced to the limit, so that
in no event shall any exaction be possible under this Instrument, the Guaranty,
the Note, the Credit Agreement, any other Loan Document or any Hedge Document be
subject to the defense of usury or otherwise transcend or violate applicable law
concerning interest or other charges that is in excess of the current limit, but
such obligation shall be fulfilled to the maximum limit permitted. The
provisions of this Section 1.14 shall control every other provision of this
Instrument, the Guaranty, the Note, the Credit Agreement or any other Loan
Document or any Hedge Document.

1.15 Conveyance of Property. Grantor hereby acknowledges to Agent that (a) the
identity and expertise of Grantor was and continues to be a material
circumstance upon which Agent has relied in connection with, and which
constitute valuable consideration to Agent for, the extending to Borrower of the
loans and other extensions of credit evidenced by the Note and Credit Agreement,
and (b) any change in such identity or expertise could materially impair or
jeopardize the security for the payment of the Secured Obligations granted to
Agent by this Instrument. Grantor therefore covenants and agrees with Agent, as
part of the consideration for the extending to Grantor of the loans evidenced by
the Note, that Grantor shall not convey, transfer, assign, further encumber or
pledge any or all of its interest in the Property except as permitted under the
Credit Agreement.

 

16

--------------------------------------------------------------------------------

ARTICLE 2

2.01 Events of Default. The terms “Default” and “Event of Default” as used
herein shall have the following meanings:

“Default” shall mean any event which, with the giving of notice or the lapse of
time, or both, would become an Event of Default.

“Event of Default” shall mean (a) any default in the payment or performance of
the obligations of Grantor hereunder or of Borrower or any other Guarantor under
any of the other Loan Documents when the same shall become due and payable which
is not cured within any grace or notice and cure period provided in the Credit
Agreement or such other Loan Documents, if any, subject to any limitations in
the Credit Agreement on the right of Grantor, Borrower or any other Guarantor to
receive notices of default, or (b) any representation or warranty of Grantor
hereunder proving to be false or incorrect in any material respect upon the date
when made or deemed to have been repeated, or (c) any default in the performance
of the obligations of Grantor or Borrower or any other Person under any of the
Security Documents beyond the expiration of any applicable notice and cure
period, (d) the occurrence of any “Event of Default” under the Credit Agreement
or any other Loan Document, (e) any amendment to or termination of a financing
statement naming Grantor as debtor and Agent as secured party, or any correction
statement with respect thereto, is filed in any jurisdiction by, or caused by,
or at the instance of Grantor or by, or caused by, or at the instance of any
principal, member, general partner or officer of Grantor (collectively, “Grantor
Party”) without the prior written consent of Agent; or (f) in the event that any
amendment to or termination of a financing statement naming Grantor as debtor
and Agent as secured party, or any correction statement with respect thereto, is
filed in any jurisdiction by any party other than a Grantor Party or Agent or
Agent’s counsel without the prior written consent of Agent and Grantor fails to
use its best efforts to cause the effect of such filing to be completely
nullified to the reasonable satisfaction of Agent within ten (10) days after
notice to Grantor thereof.

2.02 Acceleration of Maturity. If an Event of Default shall have occurred and be
continuing, then the entire Secured Obligations secured hereby shall, at the
option of Agent and as permitted by the terms of the Credit Agreement,
immediately become due and payable without notice or demand except as required
by law, time being of the essence of this Instrument.

2.03 Right to Enter and Take Possession.

(a) If an Event of Default shall have occurred and be continuing, Grantor, upon
demand of Agent, shall forthwith surrender to Agent the actual possession of the
Property, and if and to the extent permitted by law, Agent itself, or by such
officers or agents as it may appoint, may enter and take possession of all the
Property (or such portion or portions as Agent may select) without the
appointment of a receiver, or an application therefor, and may exclude Grantor
and its agents and employees wholly therefrom, and may have joint access with
Grantor to the books, papers and accounts of Grantor.

 

17

--------------------------------------------------------------------------------

(b) If Grantor shall for any reason fail to surrender or deliver the Property or
any part thereof after such demand by Agent, Agent may obtain a judgment or
decree conferring upon Agent the right to immediate possession or requiring
Grantor to deliver immediate possession of the Property to Agent. Grantor will
pay to Agent, upon demand, all expenses of obtaining such judgment or decree,
including reasonable compensation to Agent, its attorneys and agents; and all
such expenses and compensation shall, until paid, be secured by the lien of this
Instrument.

(c) Upon every such entering upon or taking of possession, Agent may hold,
store, use, operate, manage and control the Property and conduct the business
thereof and, from time to time, (i) make all necessary and proper maintenance,
repairs, renewals, replacements, additions, betterments and improvements thereto
and thereon and purchase or otherwise acquire additional fixtures, personalty
and other property; (ii) insure or keep the Property insured; (iii) lease,
manage and operate the Property and exercise all the rights and powers of
Grantor to the same extent as Grantor could in its own name or otherwise with
respect to the same; and (iv) enter into any and all agreements with respect to
the exercise by others of any of the powers herein granted Agent, all as Agent
from time to time may determine to be in its best interest. Agent may collect
and receive all the rents, issues, profits and revenues from the Property,
including those past due as well as those accruing thereafter, and, after
deducting (1) all expenses of taking, holding, managing and operating the
Property (including compensation for the services of all persons employed for
such purposes); (2) the cost of all such maintenance, repairs, renewals,
replacements, additions, betterments, improvements, purchases and acquisitions;
(3) the cost of such insurance; (4) such taxes, assessments and other similar
charges as Agent may at its option pay; (5) other proper charges upon the
Property or any part thereof; and (6) the reasonable compensation, expenses and
disbursements of the attorneys and agents of Agent, Agent shall apply the
remainder of the monies and proceeds so received by Agent in accordance with
Section 12.5 of the Credit Agreement. Agent shall have no obligation to
discharge any duties of a landlord to any tenant or to incur any liability as a
result of any exercise by Agent of any rights under this Instrument or
otherwise. Agent shall not be liable for any failure to collect rents, issues,
profits and revenues from the Property, nor shall Agent be liable to account for
any such rents, issues, profits or revenues unless actually received by Agent.

(d) Whenever all that is due upon the Secured Obligations and under any of the
terms, covenants, conditions and agreements of this Instrument shall have been
paid, the Lenders have no obligation to make further Loans and the Issuing
Lender has no further obligation to issue Letters of Credit, and all Events of
Default cured, Agent shall surrender possession of the Property to Grantor, its
successors or assigns. The same right of taking possession, however, shall exist
if any subsequent Event of Default shall occur and be continuing.

2.04 Performance by Agent. If there shall be a Default or Event of Default in
the payment, performance or observance of any term, covenant or condition of
this Instrument, Agent may, so long as such Default or Event of Default
continues, at its option, pay, perform or observe the same, and all payments
made or costs or expenses incurred by Agent in connection

 

18

--------------------------------------------------------------------------------

therewith, shall be secured hereby and shall be, upon demand, immediately repaid
by Grantor to Agent with interest thereon at the Default Rate. Agent shall be
the sole judge of the necessity for any such actions and of the amounts to be
paid. Agent is hereby empowered to enter and to authorize others to enter upon
the Land or any part thereof for the purpose of performing or observing any such
defaulted term, covenant or condition without thereby becoming liable to Grantor
or any person in possession holding under Grantor.

2.05 Receiver. If an Event of Default shall have occurred and be continuing,
Agent, upon application to a court of competent jurisdiction, shall be entitled
as a matter of strict right without regard to the occupancy or value of any
security for the Secured Obligations secured hereby or the solvency of any party
bound for its payment, to the appointment of a receiver to take possession of
and to operate the Property (or such portion or portions as Agent may select)
and to collect and apply the rents, issues, profits and revenues thereof. The
receiver shall have all of the rights and powers permitted under the laws of the
State of Texas. Grantor will pay to Agent upon demand all reasonable expenses,
including receiver’s fees, attorney’s fees, costs and agent’s compensation,
incurred pursuant to the provisions of this Section 2.05, and all such expenses
shall be secured by this Instrument.

2.06 Enforcement.

(a) If an Event of Default shall have occurred and be continuing, to the extent
permitted by law, Agent, at its option, may effect the foreclosure of this
Instrument by directing the Trustee to sell the Property (or such portion or
portions thereof as the Trustee may select) at public auction at such time and
place and upon such terms and conditions as may be required or permitted by
applicable law, after having first advertised the time, place and terms of sale
not less than once a week for three successive weeks in a newspaper having
general circulation in the city or county in which the Land being sold lies. At
any foreclosure sale, such portion of the Property as is offered for sale may,
at the Trustee’s option, be offered for sale for one total price, and the
proceeds of such sale accounted for in one account without distinction between
the items of security or without assigning to them any proportion of such
proceeds, the Grantor hereby waiving the application of any doctrine of
marshalling.

(b) If an Event of Default shall have occurred and be continuing, Agent may, in
addition to and not in abrogation of the rights covered under subparagraph
(a) of this Section 2.06, either with or without entry or taking possession as
herein provided or otherwise, proceed by a suit or suits in law or in equity or
by any other appropriate proceeding or remedy (i) to enforce payment of the
Secured Obligations or the performance of any term, covenant, condition or
agreement of this Instrument or any other right, and (ii) to pursue any other
remedy available to it, all as Agent shall determine most effectual for such
purposes.

2.07 Purchase by Agent. Upon any foreclosure sale, Agent, on behalf of the
Lenders and the holders of the Hedge Obligations, may bid for and purchase the
Property and shall be entitled to apply all or any part of the Secured
Obligations secured hereby as a credit to the purchase price.

 

19

--------------------------------------------------------------------------------

2.08 Application of Proceeds of Sale. The proceeds received by Agent as a result
of the foreclosure sale of the Property or the exercise of any other rights or
remedies hereunder shall be applied in the manner provided for in Section 12.5
of the Credit Agreement.

2.09 Grantor as Tenant Holding Over. In the event of any such foreclosure sale
by Agent, Grantor shall be deemed a tenant holding over and shall forthwith
deliver possession to the purchaser or purchasers at such sale or be summarily
dispossessed according to provisions of law applicable to tenants holding over.

2.10 Waiver of Appraisement, Valuation, Stay, Extension and Redemption Laws.
Grantor agrees, to the full extent permitted by law, that in case of a Default
or Event of Default, neither Grantor nor anyone claiming through or under it
shall or will set up, claim or seek to take advantage of any appraisement,
valuation, stay, extension, homestead, exemption or redemption laws now or
hereafter in force and Grantor, for itself and all who may at any time claim
through or under it, hereby waives to the full extent that it may lawfully so
do, the benefit of all such laws, and any and all right to have the assets
comprised in the security intended to be created hereby marshaled upon any
foreclosure of the lien hereof.

2.11 Waiver of Homestead. Grantor hereby waives and renounces all homestead and
exemption rights provided for by the Constitution and the laws of the United
States and of any state, in and to the Property as against the collection of the
Secured Obligations, or any part hereof.

2.12 Leases; Licensees. Agent, at its option, is authorized to foreclose this
Instrument subject to the rights of any tenants and licensees of the Property,
and the failure to make any such tenants or licensees parties to any such
foreclosure proceedings and to foreclose their rights will not be, nor be
asserted by Grantor to be a defense to any proceedings instituted by Agent to
collect the sums secured hereby.

2.13 Discontinuance of Proceedings and Restoration of the Parties. In case Agent
shall have proceeded to enforce any right, power or remedy under this Instrument
by foreclosure, entry or otherwise, and such proceedings shall have been
discontinued or abandoned for any reason, or shall have been determined
adversely to Agent, then and in every such case Grantor and Agent shall be
restored to their former positions and rights hereunder, and all rights, powers
and remedies of Agent shall continue as if no such proceeding had been taken.

2.14 Remedies Cumulative. No right, power or remedy conferred upon or reserved
to Agent by this Instrument is intended to be exclusive of any other right,
power or remedy, but each and every such right, power and remedy shall be
cumulative and concurrent and may be exercised against Grantor as Agent may
select and shall be in addition to any other right, power and remedy given
hereunder or now or hereafter existing at law or in equity or by statute.

2.15 Waiver.

(a) No delay or omission of Agent, any Lender or any holder of the Hedge
Obligations to exercise any right, power or remedy accruing upon any Default or
Event of Default shall exhaust or impair any such right, power or remedy or
shall be construed to be a waiver of any such Default or Event of Default, or
acquiescence therein; and every right, power

 

20

--------------------------------------------------------------------------------

and remedy given by this Instrument to Agent may be exercised from time to time
and as often as may be deemed expedient by Agent. No consent or waiver,
expressed or implied, by Agent to or of any Default or Event of Default by
Grantor in the performance of the obligations thereof hereunder shall be deemed
or construed to be a consent or waiver to or of any other Default or Event of
Default in the performance of the same or any other obligations of Grantor
hereunder. Failure on the part of Agent, the Lenders or any holder of the Hedge
Obligations to complain of any act or failure to act or to declare a Default or
Event of Default, irrespective of how long such failure continues, shall not
constitute a waiver by Agent, any Lender or any holder of the Hedge Obligations
of its rights hereunder or impair any rights, powers or remedies consequent on
any Default or Event of Default by Grantor.

(b) If Lenders or Agent on behalf of the Lenders, or any holder of the Hedge
Obligations (i) grant forbearance or an extension of time for the payment of any
sums secured hereby; (ii) take other or additional security for the payment of
any sums secured hereby; (iii) waive or do not exercise any right granted herein
or in the Note, the Credit Agreement, any other Loan Document or any Hedge
Document; (iv) release any part of the Property from the lien of this Instrument
or otherwise change any of the terms, covenants, conditions or agreements of the
Note, this Instrument, any other Loan Document or any Hedge Document;
(v) consent to the filing of any map, plat or replat affecting the Property;
(vi) consent to the granting of any easement or other right affecting the
Property; or (vii) make or consent to any agreement subordinating the lien
hereof, any such act or omission shall not release, discharge, modify, change or
affect the original liability under the Note, the Credit Agreement, the
Guaranty, this Instrument or any other obligation of Grantor, or any subsequent
purchaser of the Property or any part thereof, or any maker, co-signer,
endorser, surety or guarantor; nor shall any such act or omission preclude Agent
from exercising any right, power or privilege herein granted or intended to be
granted in the event of any Default then made or of any subsequent Default; nor,
except as otherwise expressly provided in an instrument or instruments executed
by Agent, shall the lien of this Instrument be altered thereby. In the event of
the sale or transfer by operation of law or otherwise of all or any part of the
Property, Agent, without notice, is hereby authorized and empowered to deal with
any such vendee or transferee with reference to the Property or the Secured
Obligations secured hereby, or with reference to any of the terms, covenants,
conditions or agreements hereof, as fully and to the same extent as it might
deal with the original parties hereto and without in any way releasing or
discharging any liabilities, obligations or undertakings.

2.16 Suits to Protect the Property. Agent shall have power (a) to institute and
maintain such suits and proceedings as it may deem expedient to prevent any
impairment of the Property by any acts which may be unlawful or in violation of
this Instrument, (b) to preserve or protect its interest in the Property and in
the rents, issues, profits and revenues arising therefrom, and (c) to restrain
the enforcement of or compliance with any legislation or other governmental
enactment, rule or order that may be unconstitutional or otherwise invalid, if
the enforcement of or compliance with such enactment, rule or order would impair
the security hereunder or be prejudicial to the interest of Lenders or the
holders of the Hedge Obligations.

2.17 Agent May File Proofs of Claim. In the case of any receivership,
insolvency, bankruptcy, reorganization, arrangement, adjustment, composition or
other proceedings affecting Grantor, its creditors or its property, Agent, to
the extent permitted by law, shall be entitled to

 

21

--------------------------------------------------------------------------------

file such proofs of claim and other documents as may be necessary or advisable
in order to have the claims of Agent, Lenders and the holders of the Hedge
Obligations allowed in such proceedings for the entire amount due and payable by
Grantor under this Instrument at the date of the institution of such proceedings
and for any additional amount which may become due and payable by Grantor
hereunder after such date.

2.18 WAIVER OF GRANTOR’S RIGHTS. BY EXECUTION OF THIS INSTRUMENT, GRANTOR
EXPRESSLY: (A) ACKNOWLEDGES THE RIGHT OF AGENT, THE LENDERS AND/OR THE HOLDERS
OF THE HEDGE OBLIGATIONS TO ACCELERATE THE SECURED OBLIGATIONS AND, TO THE
EXTENT PERMITTED BY LAW, THE POWER OF AGENT TO CAUSE TRUSTEE TO SELL THE
PROPERTY BY NONJUDICIAL FORECLOSURE UPON DEFAULT BY GRANTOR WITHOUT ANY JUDICIAL
HEARING AND WITHOUT ANY NOTICE OTHER THAN SUCH NOTICE (IF ANY) AS IS
SPECIFICALLY REQUIRED TO BE GIVEN UNDER THE PROVISIONS OF THIS INSTRUMENT OR BY
LAW; (B) TO THE FULL EXTENT PERMITTED BY LAW, WAIVES ANY AND ALL RIGHTS WHICH
GRANTOR MAY HAVE UNDER THE CONSTITUTION OF THE UNITED STATES (INCLUDING, WITHOUT
LIMITATION, THE FIFTH AND FOURTEENTH AMENDMENTS THEREOF), THE VARIOUS PROVISIONS
OF THE CONSTITUTIONS FOR THE SEVERAL STATES, OR BY REASON OF ANY OTHER
APPLICABLE LAW, TO NOTICE AND TO JUDICIAL HEARING PRIOR TO THE EXERCISE BY AGENT
OF ANY RIGHT OR REMEDY HEREIN PROVIDED TO AGENT, EXCEPT SUCH NOTICE (IF ANY) AS
IS SPECIFICALLY REQUIRED TO BE PROVIDED IN THIS INSTRUMENT OR BY APPLICABLE LAW;
(C) ACKNOWLEDGES THAT GRANTOR HAS READ THIS INSTRUMENT AND THE OTHER LOAN
DOCUMENTS AND ANY AND ALL QUESTIONS REGARDING THE LEGAL EFFECT OF THIS
INSTRUMENT AND THE OTHER LOAN DOCUMENTS AND THEIR PROVISIONS HAVE BEEN EXPLAINED
FULLY TO GRANTOR AND GRANTOR HAS CONSULTED WITH COUNSEL OF GRANTOR’S CHOICE
PRIOR TO EXECUTING THIS INSTRUMENT; AND (D) ACKNOWLEDGES THAT ALL WAIVERS OF THE
AFORESAID RIGHTS OF GRANTOR HAVE BEEN MADE KNOWINGLY, INTENTIONALLY AND
WILLINGLY BY GRANTOR AS PART OF A BARGAINED FOR LOAN TRANSACTION.

2.19 Claims Against Agent, Lenders and Holders of Hedge Obligations. No action
at law or in equity shall be commenced, or allegation made, or defense raised,
by Grantor against Agent, the Lenders or any holder of the Hedge Obligations for
any claim under or related to this Instrument, the Note, the Credit Agreement,
the Guaranty or any other instrument, document, transfer, conveyance, assignment
or loan agreement given by Grantor with respect to the Secured Obligations
secured hereby, or related to the conduct of the parties thereunder, unless
written notice of such claim, expressly setting forth the particulars of the
claim alleged by Grantor, shall have been given to Agent within sixty (60) days
from and after the initial awareness of Grantor of the event, omission or
circumstances forming the basis of Grantor for such claim. Any failure by
Grantor to timely provide such written notice to Agent shall constitute a waiver
by Grantor of such claim.

2.20 [Intentionally Omitted].

2.21 Indemnification; Subrogation; Waiver of Offset.

 

22

--------------------------------------------------------------------------------

(a) Grantor shall indemnify, defend and hold Agent, the Lenders and the holders
of the Hedge Obligations harmless for, from and against any and all liability,
obligations, losses, damages, penalties, claims, actions, suits, costs and
expenses (including Agent’s reasonable attorneys’ fees, together with reasonable
appellate counsel fees, if any) of whatever kind or nature which may be asserted
against, imposed on or incurred by Agent, or the Lenders or the holders of the
Hedge Obligations in connection with the Secured Obligations, this Instrument,
the Property, or any part thereof, or the exercise by Agent of any rights or
remedies granted to it under this Instrument; provided, however, that nothing
herein shall be construed to obligate Grantor to indemnify, defend and hold
harmless Agent, the Lenders or the holders of the Hedge Obligations for, from
and against any and all liabilities, obligations, losses, damages, penalties,
claims, actions, suits, costs and expenses asserted against, imposed on or
incurred by Agent or a Lender by reason of such Person’s willful misconduct or
gross negligence if a judgment is entered against Agent, a Lender or a holder of
a Hedge Obligation by a court of competent jurisdiction after the expiration of
all applicable appeal periods.

(b) If Agent, a Lender or a holder of a Hedge Obligation is made a party
defendant to any litigation or any claim is threatened or brought against Agent,
a Lender or a holder of a Hedge Obligation concerning the Secured Obligations,
this Instrument, the Property, or any part thereof, or any interest therein, or
the construction, maintenance, operation or occupancy or use thereof, then
Grantor shall indemnify, defend and hold such Person harmless for, from and
against all liability by reason of said litigation or claims, including
reasonable attorneys’ fees (together with reasonable appellate counsel fees, if
any) and expenses incurred by such Person in any such litigation or claim,
whether or not any such litigation or claim is prosecuted to judgment; provided,
however, that nothing in this Section 2.21(b) shall be construed to obligate
Grantor to indemnify, defend and hold harmless Agent, a Lender or a holder of a
Hedge Obligation for, from and against any and all liabilities or claims imposed
on or incurred by such Person by reason of such Person’s willful misconduct or
gross negligence if a judgment is entered against such Person by a court of
competent jurisdiction after expiration of all applicable appeal periods. If
Agent commences an action against Grantor to enforce any of the terms hereof or
to prosecute any breach by Grantor of any of the terms hereof or to recover any
sum secured hereby, Grantor shall pay to Agent its reasonable attorneys’ fees
(together with reasonable appellate counsel, fees, if any) and expenses. The
right to such attorneys’ fees (together with reasonable appellate counsel fees,
if any) and expenses shall be deemed to have accrued on the commencement of such
action, and shall be enforceable whether or not such action is prosecuted to
judgment. If Grantor breaches any term of this Instrument, Agent may engage the
services of an attorney or attorneys to protect its rights hereunder, and in the
event of such engagement following any breach by Grantor, Grantor shall pay
Agent reasonable attorneys’ fees (together with reasonable appellate counsel
fees, if any) and expenses incurred by Agent, whether or not an action is
actually commenced against Grantor by reason of such breach. All references to
“attorneys” in this Subsection and elsewhere in this Instrument shall include
without limitation any attorney or law firm engaged by Agent and Agent’s
in-house counsel, and all references to “fees and expenses” in this Subsection
and elsewhere in this Instrument shall include without limitation any fees of
such attorney or law firm and any allocation charges and allocation costs of
Agent’s in-house counsel.

 

23

--------------------------------------------------------------------------------

(c) A waiver of subrogation shall be obtained by Grantor from its insurance
carrier and, consequently, Grantor waives any and all right to claim or recover
against Agent, the Lenders, the holders of the Hedge Obligations and each of
their respective officers, employees, agents and representatives, for loss of or
damage to Grantor, the Property, Grantor’s property or the property of others
under Grantor’s control from any cause insured against or required to be insured
against by the provisions of this Instrument.

(d) ALL SUMS PAYABLE BY GRANTOR HEREUNDER SHALL BE PAID WITHOUT NOTICE (EXCEPT
AS MAY OTHERWISE BE PROVIDED HEREIN), DEMAND, COUNTERCLAIM, SETOFF, DEDUCTION OR
DEFENSE AND WITHOUT ABATEMENT, SUSPENSION, DEFERMENT, DIMINUTION OR REDUCTION,
AND THE SECURED OBLIGATIONS AND LIABILITIES OF GRANTOR HEREUNDER SHALL IN NO WAY
BE RELEASED, DISCHARGED OR OTHERWISE AFFECTED BY REASON OF: (I) ANY DAMAGE TO OR
DESTRUCTION OF OR ANY CONDEMNATION OR SIMILAR TAKING OF THE PROPERTY OR ANY PART
THEREOF; (II) ANY RESTRICTION OR PREVENTION OF OR INTERFERENCE WITH ANY USE OF
THE PROPERTY OR ANY PART THEREOF; (III) ANY TITLE DEFECT OR ENCUMBRANCE OR ANY
EVICTION FROM THE LAND OR THE IMPROVEMENTS ON THE LAND OR ANY PART THEREOF BY
TITLE PARAMOUNT OR OTHERWISE; (IV) ANY BANKRUPTCY, INSOLVENCY, REORGANIZATION,
COMPOSITION, ADJUSTMENT, DISSOLUTION, LIQUIDATION, OR OTHER LIKE PROCEEDING
RELATING TO AGENT, THE LENDERS OR ANY HOLDER OF THE HEDGE OBLIGATIONS, OR ANY
ACTION TAKEN WITH RESPECT TO THIS INSTRUMENT BY ANY TRUSTEE OR BY ANY RECEIVER
OF AGENT, OR BY ANY COURT, IN SUCH PROCEEDING; (V) ANY CLAIM WHICH GRANTOR HAS,
OR MIGHT HAVE, AGAINST AGENT, THE LENDERS OR ANY HOLDER OF THE HEDGE
OBLIGATIONS; (VI) ANY DEFAULT OR FAILURE ON THE PART OF AGENT, THE LENDERS OR
ANY HOLDER OF THE HEDGE OBLIGATIONS TO PERFORM OR COMPLY WITH ANY OF THE TERMS
HEREOF OR OF ANY OTHER AGREEMENT WITH GRANTOR; OR (VII) ANY OTHER OCCURRENCE
WHATSOEVER, WHETHER SIMILAR OR DISSIMILAR TO THE FOREGOING, WHETHER OR NOT
GRANTOR SHALL HAVE NOTICE OR KNOWLEDGE OF ANY OF THE FOREGOING. GRANTOR WAIVES
ALL RIGHTS NOW OR HEREAFTER CONFERRED BY STATUTE OR OTHERWISE TO ANY ABATEMENT,
SUSPENSION, DEFERMENT, DIMINUTION, OR REDUCTION OF ANY SUM SECURED HEREBY AND
PAYABLE BY GRANTOR.

2.22 Revolving Credit/Future Advance. This Instrument secures Secured
Obligations which may provide for a variable rate of interest as well as
revolving credit advances and other future advances, whether such advances are
obligatory or otherwise. Advances under the Note are subject to the terms and
provisions of the Credit Agreement and the other Security Documents. Grantor
acknowledges that the Secured Obligations may increase or decrease from time to
time and that if the outstanding balance of the Secured Obligations is ever
repaid to zero the security title and security interest created by this
Instrument shall not be deemed released or extinguished by operation of law or
implied intent of the parties. This Instrument shall remain in full force and
effect as to any further advances under the Credit Agreement made after any such
zero balance until the Secured Obligations are paid in full, all agreements to
make further advances or issue letters of credit have been terminated and this
Instrument has been canceled of record. Grantor waives the operation of any
applicable statutes, case law or regulation having a contrary effect.

 

24

--------------------------------------------------------------------------------

ARTICLE 3

3.01 Successors and Assigns. This Instrument shall inure to the benefit of and
be binding upon Grantor, Trustee and Agent and their respective heirs,
executors, legal representatives, successors and assigns. Whenever a reference
is made in this Instrument to Grantor, Trustee or Agent such reference shall be
deemed to include a reference to the heirs, executors, legal representatives,
successors and assigns of Grantor or Agent.

3.02 Terminology. All personal pronouns used in this Instrument whether used in
the masculine, feminine or neuter gender, shall include all other genders; the
singular shall include the plural, and vice versa. Titles and Articles are for
convenience only and neither limit nor amplify the provisions of this Instrument
itself, and all references herein to Articles, Sections or subsections thereof,
shall refer to the corresponding Articles, Sections or subsections thereof, of
this Instrument unless specific reference is made to such Articles, Sections or
subsections thereof of another document or instrument.

3.03 Severability. If any provision of this Instrument or the application
thereof to any person or circumstance shall be invalid or unenforceable to any
extent, the remainder of this Instrument and the application of such provisions
to other persons or circumstances shall not be affected thereby and shall be
enforced to the greatest extent permitted by law.

3.04 Applicable Law. This Instrument will be governed by the substantive laws of
the State of Texas, without giving effect to its principles of choice of law or
conflicts of law (except with respect to choice of law or conflicts of law
provisions of its Uniform Commercial Code), and the laws of the United States
applicable to transactions in the State of Texas. Should any obligation or
remedy under this Instrument be invalid or unenforceable pursuant to the laws
provided herein to govern, the laws of any other state referred to herein or of
another state whose laws can validate and apply thereto shall govern.

3.05 Notices. Except as otherwise provided herein, any notice or other
communication required hereunder shall be in writing, and shall be deemed to
have been validly served, given or delivered if given and delivered as provided
in the Guaranty if given to Grantor or as provided in the Credit Agreement if
given to Agent.

3.06 Conflict with Credit Agreement Provisions. Grantor hereby acknowledges and
agrees that, in the event of any conflict between the terms hereof and the terms
of the Credit Agreement, the terms of the Credit Agreement shall control.

3.07 Assignment. This Instrument is assignable by Agent, and any assignment
hereof by Agent shall operate to vest in the assignee all rights and powers
herein conferred upon and granted to Agent.

3.08 Time of the Essence. Time is of the essence with respect to each and every
covenant, agreement and obligation of Grantor under this Instrument, and any and
all other instruments now or hereafter evidencing, securing or otherwise
relating to the Secured Obligations.

 

25

--------------------------------------------------------------------------------

3.09 Grantor. Unless the context clearly indicates otherwise, as used in this
Instrument, “Grantor” means the grantors named in recitals hereof or any of
them. The obligations of Grantor hereunder shall be joint and several. If any
Grantor, or any signatory who signs on behalf of any Grantor, is a corporation,
partnership or other legal entity, Grantor and any such signatory, and the
person or persons signing for it, represent and warrant to Agent that this
instrument is executed, acknowledged and delivered by Grantor’s duly authorized
representatives.

3.10 Place of Payment; Forum; Waiver of Jury Trial. All Secured Obligations
which may be owing hereunder at any time by Borrower or Grantor shall be payable
at the place designated in the Credit Agreement (or if no such designation is
made, at the address of Agent indicated at the end of this Instrument). Grantor
hereby irrevocably submits generally and unconditionally for itself and in
respect of its property to the non-exclusive jurisdiction of any state court, or
any United States federal court, sitting in the county in which the Secured
Obligations are payable, and to the non-exclusive jurisdiction of any state
court or any United States federal court sitting in the state in which any of
the Property is located, over any suit, action or proceeding arising out of or
relating to this Instrument or the Secured Obligations. Grantor hereby
irrevocably waives, to the fullest extent permitted by law, any objection that
Grantor may now or hereafter have to the laying of venue in any such court and
any claim that any such court is an inconvenient forum. Grantor hereby agrees
and consents that, in addition to any methods of service of process provided for
under applicable law, all service of process in any such suit, action or
proceeding may be made by certified or registered mail, return receipt
requested, directed to Grantor at its address stated in the first paragraph of
this Instrument, or at a subsequent address of Grantor of which Agent received
actual notice from Grantor in accordance with the Credit Agreement, and service
so made shall be completed five (5) days after the same shall have been so
mailed. Nothing herein shall affect the right of Agent to serve process in any
manner permitted by law or limit the right of Agent to bring proceedings against
Grantor in any other court or jurisdiction. TO THE FULLEST EXTENT PERMITTED BY
LAW, GRANTOR WAIVES THE RIGHT TO TRIAL BY JURY IN CONNECTION WITH ANY ACTION,
SUIT OR OTHER PROCEEDING ARISING OUT OF OR RELATING TO THIS INSTRUMENT OR ANY
OTHER LOAN DOCUMENT.

ARTICLE 4–STATE SPECIFIC PROVISIONS

4.01 Principles of Construction. In the event of any inconsistencies between the
terms and conditions of this Article 4 and the terms and conditions of this
Instrument, the terms and conditions of this Article 4 shall control and be
binding.

4.02 Future Advances. This Instrument is given to secure not only the existing
Secured Obligations, but also such future advances, whether such advances are
obligatory or are to be made at the option of Agent or the holder hereof, or
otherwise as are made within twenty (20) years from the date hereof, to the same
extent as if such future advances were made on the date of the execution of this
Instrument. The total amount of Secured Obligations that may be so secured by
this Instrument may be increased or decreased from time to time (as set forth in
the Credit Agreement), but the total unpaid balance so secured at any one time
shall not exceed the face amount of the Secured Obligations secured by this
Instrument on the date hereof, plus interest thereon, and any disbursements made
for the payment of Impositions and any other liens,

 

26

--------------------------------------------------------------------------------

assessments and charges of every character (the “Other Charges”), insurance
premiums, or other costs to be incurred hereunder, with interest on such
disbursements at the rate set forth in the Credit Agreement, plus any increases
in the principal balance as the result of negative amortization or deferred
interest, if any. It is agreed that any additional sum or sums advanced by Agent
pursuant to the terms hereof or pursuant to the Credit Agreement shall be
equally secured with and have the same priority as the original Secured
Obligations and shall be subject to all of the terms, provisions and conditions
of this Instrument, whether or not such additional loans or advances are
evidenced by other promissory notes or other guaranties of Grantor and whether
or not identified by a recital that it or they are secured by this Instrument.
It is further agreed that any additional promissory note or promissory notes
executed and delivered pursuant to this paragraph shall automatically be deemed
to be included in the term “Note” wherever they appear in the context of this
Instrument.

4.03 State-Specific Provisions.

(a) The assignments of Leases and Revenues set forth in this Instrument are not
intended to constitute payment to Agent, Lenders or Trustee unless Grantor’s
license to collect Revenues is terminated, and then only to the extent that the
Revenues are actually received by Agent or any Lender (as opposed to
constituting a portion of the voluntary payments of any amounts due under the
Guaranty or the other Loan Documents) and are not used for the operation or
maintenance of the Property or for the payment of costs and expenses in
connection therewith, taxes, assessments, water charges, sewer rents, and other
charges levied, assessed or imposed against the Property, insurance premiums,
costs and expenses with respect to any litigation affecting the Property, the
leases, the concessions, and the rent, any wages and salaries of employees,
commissions of agents and attorneys fees. It is further the intent of Grantor,
Agent and Lenders that the Revenues hereby absolutely assigned are no longer,
during the term of this Instrument, property of Grantor or property of any
estate of Grantor as defined in 11 U.S.C. § 541 and shall not constitute
collateral, cash or otherwise, of Grantor. The term Revenues as used herein
shall mean the gross rents without deduction or offsets of any kind.

(b) BY EXECUTION OF THIS INSTRUMENT AND TO THE FULL EXTENT PERMITTED BY LAW,
GRANTOR EXPRESSLY WAIVES ANY AND ALL RIGHTS WHICH GRANTOR MAY HAVE UNDER THE
CONSTITUTION OF THE UNITED STATES (INCLUDING, WITHOUT LIMITATION, THE FIFTH AND
FOURTEENTH AMENDMENTS THEREOF), THE VARIOUS PROVISIONS OF THE CONSTITUTIONS FOR
THE SEVERAL STATES, OR BY REASON OF ANY OTHER APPLICABLE LAW, TO NOTICE AND TO
JUDICIAL HEARING PRIOR TO THE EXERCISE BY AGENT OF (1) INTENT TO ACCELERATE THE
LOAN, OR (2) ACCELERATION THE LOAN.

(c) Notwithstanding anything to the contrary herein, all references in this
Instrument to an assignment or transfer of Leases and Revenues is intended to
and shall be deemed to provide to Agent and the Lenders a security interest in
all “Rents” as defined in Chapter 64 of the Texas Property Code. Agent and the
Lenders shall be entitled to all rights and remedies of an assignee as set forth
in said Chapter 64.

4.04 Additional Remedy Provisions.

 

27

--------------------------------------------------------------------------------

(a) Delivery Upon Sale. Upon the completion of any sale or sales pursuant
hereto, Trustee shall execute and deliver to the accepted purchaser or
purchasers a good and sufficient instrument, or good and sufficient instruments,
conveying, assigning and transferring all estate, right, title and interest in
and to the property and rights sold by general warranty of title. Trustee is
hereby irrevocably appointed the true and lawful attorney of Grantor, in its
name and stead, to make all necessary conveyances, assignments, transfers and
deliveries of the Property and rights so sold and for that purpose Trustee may
execute all necessary instruments of conveyance, assignment and transfer, and
may substitute one or more persons with like power, Grantor hereby ratifying and
confirming all that its said attorney or such substitute or substitutes shall
lawfully do by virtue hereof. Any sale or sales made under or by virtue of this
section, whether made under the power of sale herein granted or under or by
virtue of judicial proceedings or of a judgment or decree of foreclosure and
sale, shall operate to divest all the estate, right, title, interest, claim and
demand whatsoever, whether at law or in equity, of Grantor in and to the
properties and rights so sold, and shall be a perpetual bar both at law and in
equity against Grantor and against any and all persons claiming or who may claim
the same, or any part thereof from, through or under Grantor.

(b) Option to Bid. Upon any sale made under or by virtue of this paragraph,
whether made under the power of sale herein granted or under or by virtue of
judicial proceedings or of a judgment or decree of foreclosure and sale, Agent
may bid for and acquire the Property or any part thereof and in lieu of paying
cash therefor may make settlement for the purchase price by crediting upon the
Secured Obligations the net sales price after deducting therefrom the expenses
of the sale and costs of the action and any other sums which Agent is authorized
to deduct under this Instrument.

(c) Remaining Liens. No recovery of any judgment by Agent and no levy of an
execution under any judgment upon the Property shall affect in any manner or to
any extent the lien of this Instrument upon the Property or any part thereof, or
any liens, rights, powers or remedies of Agent hereunder, but such liens,
rights, powers and remedies of Agent shall continue unimpaired as before.

(d) No Waiver of Remedies. Agent may resort to any remedies and the security
given by the Guaranty, this Instrument or the other Loan Documents in whole or
in part, and in such portions and in such order as determined by Agent’s sole
discretion. No such action shall in any way be considered a waiver of any
rights, benefits or remedies evidenced or provided by the Guaranty, this
Instrument or any of the other Loan Documents. The failure of Agent to exercise
any right, remedy or option provided in the Guaranty, this Instrument or any of
the other Loan Documents shall not be deemed a waiver of such right, remedy or
option or of any covenant or obligation secured by the Guaranty, this Instrument
or the other Loan Documents. No acceptance by Agent of any payment after the
occurrence of any Event of Default and no payment by Agent of any obligation for
which Grantor is liable hereunder shall be deemed to waive or cure any Event of
Default with respect to Grantor’s liability to pay such obligation. No sale of
all or any portion of the Property, no forbearance on the part of Agent, and no
extension of time for the payment of the whole or any portion of the Secured
Obligations or any other indulgence given by Agent to Grantor, shall operate to
release or in any manner affect the interest of Agent, any Lender or any holder
of the Hedge Obligations in the remaining Property or the liability of Grantor
to pay the Secured Obligations or the liability of Grantor

 

28

--------------------------------------------------------------------------------

under the Guaranty. No waiver by Agent shall be effective unless it is in
writing and then only to the extent specifically stated. All costs and expenses
of Agent and Lenders in exercising their rights and remedies under this
Instrument (including reasonable attorneys’ fees and disbursements to the extent
permitted by law), shall be paid by Grantor immediately upon notice from Agent,
and such costs and expenses shall constitute a portion of the Secured
Obligations and shall be secured by this Instrument. The interests and rights of
Agent, any Lender or any holder of the Hedge Obligations under the Guaranty,
this Instrument or in any of the other Loan Documents shall not be impaired by
any indulgence, including (i) any renewal, extension or modification which Agent
or any Lender may grant with respect to any of the Secured Obligations, (ii) any
surrender, compromise, release, renewal, extension, exchange or substitution
which Agent, any Lender, or any holder of the Hedge Obligations may grant with
respect to the Property or any portion thereof; or (iii) any release or
indulgence granted to any maker, endorser, guarantor or surety of any of the
Secured Obligations.

(e) Foreclosure. Upon the occurrence and during the continuance of any Event of
Default, Agent may request Trustee to proceed with foreclosure under the power
of sale which is hereby conferred, such foreclosure to be accomplished in
accordance with the following provisions:

(1) Public Sale. Trustee is hereby authorized and empowered, and it shall be
Trustee’s special duty, upon such request of Agent, to sell the Property, or any
part thereof, at public auction to the highest bidder for cash, with or without
having taken possession of same. Any such sale (including notice thereof) shall
comply with the applicable requirements, at the time of the sale, of
Section 51.002 of the Texas Property Code or, if and to the extent such statute
is not then in force, with the applicable requirements, at the time of the sale,
of the successor statute or statutes, if any, governing sales of Texas real
property under powers of sale conferred by deeds of trust. If there is no
statute in force at the time of the sale governing sales of Texas real property
under powers of sale conferred by deeds of trust, such sale shall comply with
applicable law, at the time of the sale, governing sales of Texas real property
under powers of sale conferred by deeds of trust. Trustee or his successor or
substitute may appoint or delegate any one or more persons as agent to perform
any act or acts necessary or incident to any sale held by Trustee, including the
posting of notices, and the conduct of sale, but in the name and on behalf of
Trustee, his successor or substitute.

(2) Right to Require Proof of Financial Ability and/or Cash Bid. To the extent
permitted by applicable law, any time during the bidding, Trustee may require a
bidding party (A) to disclose its full name, state and city of residence,
occupation, and specific business office location, and the name and address of
the principal the bidding party is representing (if applicable), and (B) to
demonstrate reasonable evidence of the bidding party’s financial ability (or, if
applicable, the financial ability of the principal of such bidding party), as a
condition to the bidding party submitting bids at the foreclosure sale. If any
such bidding party (the “Questioned Bidder”) declines to comply with Trustee’s
requirement in this regard, or if such Questioned Bidder does respond but
Trustee, in Trustee’s sole and absolute discretion, deems the information or the
evidence of the financial ability of the Questioned Bidder (or, if applicable,
the principal of such bidding party) to be inadequate, then Trustee may continue
the bidding with reservation; and in such event (1) Trustee shall be authorized
to caution the Questioned Bidder concerning the legal obligations to be incurred
in submitting bids, and (2) if

 

29

--------------------------------------------------------------------------------

the Questioned Bidder is not the highest bidder at the sale, or if having been
the highest bidder the Questioned Bidder fails to deliver the cash purchase
price payment promptly to Trustee, all bids by the Questioned Bidder shall be
null and void. Trustee may, in Trustee’s sole and absolute discretion, determine
that a credit bid may be in the best interest of the Grantor and Agent, and
elect to sell the Property for credit or for a combination of cash and credit;
provided, however, that Trustee shall have no obligation to accept any bid
except an all cash bid. In the event Trustee requires a cash bid and cash is not
delivered within a reasonable time after conclusion of the bidding process, as
specified by Trustee, but in no event later than 3:45 p.m. local time on the day
of sale, then said contingent sale shall be null and void, the bidding process
may be recommenced, and any subsequent bids or sale shall be made as if no prior
bids were made or accepted.

(3) Sale Subject to Unmatured Secured Obligations. In addition to the rights and
powers of sale granted under the preceding provisions of this subsection (e), if
default is made in the payment of any installment of the Secured Obligations and
is not cured within applicable cure periods, Agent may, at Agent’s option, at
once or at any time thereafter while any matured installment remains unpaid,
without declaring the entire Secured Obligations to be due and payable, orally
or in writing direct Trustee to enforce this Instrument and to sell the Property
subject to such unmatured Secured Obligations and to the rights, powers, liens,
security interests, and assignments securing or providing recourse for payment
of such unmatured Secured Obligations, in the same manner, all as provided in
the preceding provisions of this subsection. Sales made without maturing the
Secured Obligations may be made hereunder whenever there is a default in the
payment of any installment of the Secured Obligations, without exhausting the
power of sale granted hereby, and without affecting in any way the power of sale
granted under this subsection, the unmatured balance of the Secured Obligations
or the rights, powers, liens, security interests, and assignments securing or
providing recourse for payment of the Secured Obligations.

(4) Partial Foreclosure. Sale of a part of the Property shall not exhaust the
power of sale, but sales may be made from time to time until the Secured
Obligations are paid in full. It is intended by each of the foregoing provisions
of this subsection that Trustee may, after any request or direction by Agent,
sell not only the Land and the Improvements, but also the fixtures and other
interests constituting a part of the Property or any part thereof, along with
the Land and the Improvements or any part thereof, as a unit and as a part of a
single sale, or may sell at any time or from time to time any part or parts of
the Property separately from the remainder of the Property. It shall not be
necessary to have present or to exhibit any of the Property at any sale. Any
sale of personal property made hereunder shall be deemed to have been a public
sale conducted in a commercially reasonable manner if held contemporaneously
with, or as part of, and upon the same notice as required for the sale of real
property under the power of sale granted herein.

(f) Trustee’s Deeds. After any sale under this subsection, Trustee shall make
good and sufficient deeds, assignments, and other conveyances to the purchaser
or purchasers thereunder in the name of Grantor, conveying the Property or any
part thereof so sold to the purchaser or purchasers with general warranty of
title by Grantor. It is agreed that in any deeds, assignments or other
conveyances given by Trustee, any and all statements of fact or other recitals
therein made as to the identity of Agent, the occurrence or existence of any
Event of

 

30

--------------------------------------------------------------------------------

Default, the notice of intention to accelerate, or acceleration of, the maturity
of the Secured Obligations, the request to sell, notice of sale, time, place,
terms and manner of sale, and receipt, distribution, and application of the
money realized therefrom, the due and proper appointment of a substitute
trustee, and without being limited by the foregoing, any other act or thing
having been duly done by or on behalf of Agent or by or on behalf of Trustee,
shall be taken by all courts of law and equity as prima facie evidence that such
statements or recitals state true, correct, and complete facts and Grantor does
hereby ratify and confirm any and all acts that Trustee may lawfully do in the
premises by virtue hereof.

(g) Inapplicability of Credit Code. In no event shall the provisions of Chapter
346 of the Texas Finance Code (which regulates certain revolving credit loan
accounts and revolving triparty accounts) apply to the Secured Obligations.

(h) Maturity Date. The Secured Obligations relating to the Term Loan Notes have
a final maturity date of August 9, 2017, unless extended as provided in the
Credit Agreement, and all other Secured Obligations have a final maturity date
of August 9, 2016, unless extended as provided in the Credit Agreement.

(i) Notice of Indemnification. GRANTOR ACKNOWLEDGES THAT THIS INSTRUMENT
PROVIDES FOR INDEMNIFICATION OF AGENT, LENDERS, HOLDERS OF THE HEDGE OBLIGATIONS
AND TRUSTEE BY GRANTOR. EXCEPT FOR THE GROSS NEGLIGENCE, WILLFUL MISCONDUCT, BAD
FAITH, FRAUD, OR ILLEGAL ACTS OF AGENT, LENDERS, HOLDERS OF THE HEDGE
OBLIGATIONS OR THEIR RESPECTIVE AGENTS, EMPLOYEES OR CONTRACTORS WHICH SHALL BE
EXCLUDED FROM THE INDEMNIFICATION OF GRANTOR, IT IS SPECIFICALLY INTENDED BY
GRANTOR, AGENT, LENDERS, THE HOLDERS OF THE HEDGE OBLIGATIONS AND TRUSTEE THAT
ALL INDEMNITY OBLIGATIONS AND LIABILITIES ASSUMED BY GRANTOR HEREUNDER BE
WITHOUT LIMIT AND WITHOUT REGARD TO THE CAUSE OR CAUSES THEREOF (INCLUDING
PREEXISTING CONDITIONS), STRICT LIABILITY, OR THE NEGLIGENCE OF ANY PARTY OR
PARTIES (INCLUDING AGENT, LENDERS, HOLDERS OF THE HEDGE OBLIGATIONS AND TRUSTEE)
WHETHER SUCH NEGLIGENCE BE SOLE, JOINT OR CONCURRENT, OR PASSIVE. THE PARTIES
SPECIFICALLY INTEND THAT AGENT, LENDERS, THE HOLDERS OF THE HEDGE OBLIGATIONS
AND TRUSTEE ARE TO BE INDEMNIFIED AGAINST THEIR OWN NEGLIGENCE (BUT NOT THEIR
OWN GROSS NEGLIGENCE OR WILLFUL MISCONDUCT).

(j) Substitute Trustee. In case of the resignation of Trustee, or the inability
(through death or otherwise), refusal or failure of Trustee to act, or at the
option of Agent for any other reason (which reason need not be stated), a
substitute Trustee (herein referred to as the “Substitute Trustee”) may be
named, constituted and appointed by Agent, without other formality than an
appointment and designation in writing, which appointment and designation shall
be full evidence of the right and authority to make the same and of all facts
therein recited, and this conveyance shall vest in the Substitute Trustee the
title, powers and duties herein conferred on Trustee originally named herein,
and the conveyance of the Substitute Trustee to the purchaser(s) at any sale of
the Property or any part thereof shall be equally valid and effective. The right
to appoint a Substitute Trustee shall exist as often and whenever from any of

 

31

--------------------------------------------------------------------------------

said causes, Trustee or Substitute Trustee, resigns or cannot, will not or does
not act, or Agent desires to appoint a new Trustee. No bond shall ever be
required of Trustee or Substitute Trustee. The recitals in any conveyance made
by Trustee or Substitute Trustee, shall be accepted and construed in court and
elsewhere as prima facie evidence and proof of the facts recited, and no other
proof shall be required as to the request by Agent to Trustee to enforce this
Instrument, or as to the notice of or holding of the sale, or as to any
particulars thereof, or as to the resignation of Trustee or Substitute Trustee,
or as to the inability, refusal or failure of Trustee or Substitute Trustee, to
act, or as to the election of Agent to appoint a new Trustee, or as to
appointment of a Substitute Trustee, and all prerequisites of said sale shall be
presumed to have been performed; and each sale made under the powers herein
granted shall be a perpetual bar against Grantor and the successors and assigns
of Grantor. Trustee or Substitute Trustee is hereby authorized and empowered to
appoint any one or more persons as attorney-in-fact to act as Trustee under him
and in his name, place and stead in order to take any actions that Trustee is
authorized and empowered to do hereunder, such appointment to be evidenced by an
instrument signed and acknowledged by said Trustee or Substitute Trustee and all
acts done by said attorney-in-fact shall be valid, lawful and binding as if done
by said Trustee or Substitute Trustee in person. The Agent may appoint or
authorize a mortgage servicer to appoint a substitute trustee, such appointment
or authorization to be made by power of attorney, corporate resolution or other
written instrument. A mortgage servicer may authorize an attorney to appoint a
substitute trustee or substitute trustees on behalf of Agent and the Lenders.
The name and street address of such trustee or substitute trustee shall be
disclosed on the notice of sale required by Section 51.002 of the Texas Property
Code.

(k) Grantor hereby waives any right or remedy which Grantor may have or be able
to assert pursuant to Chapter 34 of the Texas Business and Commerce Code, or any
other provision of Texas law, pertaining to the rights and remedies of sureties.

(l) The remedies in this Section 4.04 shall be available under and governed by
the real property laws of Texas and shall not be governed by the personal
property laws of Texas, including, but not limited to, the power to dispose of
personal property in a commercially reasonable manner under Section 9.504 of the
Texas Uniform Commercial Code, unless Lender elects to proceed as to the
Collateral together with the other Property under and pursuant to the real
property remedies of this Section 4.04.

(m) Waiver. In the event an interest in any of the Property is foreclosed upon
pursuant to a judicial or nonjudicial foreclosure sale, Grantor agrees as
follows: notwithstanding the provisions of Sections 51.003, 51.004, and 51.005
of the Texas Property Code (as the same may be amended from time to time), and
to the extent permitted by law, Grantor agrees that Agent and the Lenders shall
be entitled to seek a deficiency judgment from Grantor and any other party
obligated on the Note equal to the difference between the amount owing on the
Note and the amount for which the Property was sold pursuant to judicial or
nonjudicial foreclosure sale. Grantor expressly recognizes that this
Section 4.04(m) constitutes a waiver of the above cited provisions, to the
extent permitted by applicable law, of the Texas Property Code which would
otherwise permit Grantor and other persons against whom recovery of deficiencies
is sought or Guarantor independently (even absent the initiation of deficiency
proceedings against them) to present competent evidence of the fair market value
of the Property as of the date of the foreclosure sale and offset against any
deficiency the amount by which the foreclosure sale price

 

32

--------------------------------------------------------------------------------

is determined to be less than such fair market value. Grantor further recognizes
and agrees that this waiver creates an irrebuttable presumption that the
foreclosure sale price is equal to the fair market value of the Property for
purposes of calculating deficiencies owed by Grantor, Guarantor, and others
against whom recovery of a deficiency is sought.

4.05 Waiver of Consequential, Punitive and Speculative Damages. Grantor and
Agent agree that, in connection with any action, suit or proceeding relating to
or arising out of this Instrument or any of the other Loan Documents, each
mutually waives to the fullest extent permitted by applicable law, any claim for
consequential, punitive or speculative damages.

4.06 Notice of Insurance Termination/Cancellation. Notwithstanding anything to
the contrary set forth in the Credit Agreement, Borrower and Grantor shall only
be required to provide fifteen (15) days prior written notice of the early
cancellation or termination of any insurance policy covering the Property.

ARTICLE 5–LEASEHOLD MORTGAGE PROVISIONS

5.01 Status of Ground Lease. Grantor hereby warrants and represents as follows:
(i) the Ground Lease constitutes the sole agreement between Grantor and the
Lessor with respect to the Leased Premises and is in full force and effect in
accordance with its terms, covenants and conditions, unmodified by any writing
or otherwise; (ii) that the Ground Lease is a valid and subsisting lease of the
Leased Premises and other property leased pursuant to the Ground Lease;
(iii) all rent, additional rent and other charges reserved therein have been
paid to the extent they are payable to the date hereof; (iv) Grantor enjoys the
quiet and peaceful possession of the Leased Premises demised by the Ground
Lease, subject to the terms thereof; (v) neither Grantor nor, to Grantor’s
knowledge, the Lessor is in default under any of the terms of the Ground Lease
and, to Grantor’s knowledge, there are no circumstances which, with the passage
of time or the giving of notice or both, would constitute a default or event of
default thereunder; (vi) there are no encumbrances of the Ground Lease except as
set forth on Exhibit B hereto and (v) that a true and correct copy of the Ground
Lease has been delivered by Grantor to Agent.

5.02 Continuation of Ground Lease. Grantor shall not, except with the prior
written consent of Agent, (i) cancel, terminate, or surrender the Ground Lease,
or consent to, acquiesce in or accept any cancellation, rejection or termination
thereof, or permit any condition or event to exist which would terminate or
cancel the same or permit such termination or cancellation, or (ii) consent or
fail to object to any attempt by Lessor to sell or transfer its interest in the
Land and the Improvements free and clear of the Ground Lease, or (iii) amend,
modify or otherwise change any term, covenant or condition of the Ground Lease,
or (iv) take any action in connection with the Ground Lease which would have the
effect of materially impairing the value of Grantor’s interest thereunder or of
the Leased Premises, or of materially impairing the interest of Agent or Lenders
therein, or (v) waive, excuse or discharge any of the material obligations and
agreements of any other party under the Ground Lease, or subordinate or consent
to the subordination of the Ground Lease to any mortgage or deed of trust on any
party’s interest in the property demised by the Ground Lease or consent to any
restriction, covenant or agreement affecting the leasehold estate created by the
Ground Lease, or (vi) further assign, transfer, convey, pledge, encumber or
permit the encumbrance of its interest under the Ground Lease. Any attempt on
the part of Grantor to exercise any of the forgoing rights without such written
consent of Agent shall be null and void and of no effect.

 

33

--------------------------------------------------------------------------------

5.03 Assignment of Rights under Ground Lease. As further security for the
payment of the Secured Obligations and for the performance of the covenants
contained in this Instrument, Grantor hereby assigns to Agent, on behalf of the
Lenders, all of its rights, privileges and prerogatives to terminate,
subordinate, cancel, modify, change, supplement, alter, amend, renew, consent or
object to any attempted transfer of Lessor’s interest in the Land and the
Improvements free and clear of the Ground Lease, extend or give consents or
approvals under the Ground Lease (including, without limitation, the right to
elect to accede to any rejection of the Ground Lease in any bankruptcy
proceeding of the landlord thereunder), either orally, by course of conduct or
in writing, and any such termination, subordination, cancellation, modification,
change, supplement, alteration, amendment, extension, consent or approval of or
under the Ground Lease by the Grantor, without the prior written consent thereto
by Agent, shall be void and of no force and effect. Provided that no Event of
Default has occurred and is continuing, Grantor shall be permitted to exercise
its rights, privileges and prerogatives to renew or extend the Ground Lease to
the extent otherwise permitted hereunder.

5.04 Delivery of Notices. Grantor shall furnish to Agent such information and
evidence as Agent may reasonably require concerning the due observance,
performance and compliance with the terms, covenants and provisions, of the
Ground Lease including, but not limited to, any evidence of efforts to cure any
default during any applicable grace period under the Ground Lease. If, pursuant
to the Ground Lease, the Lessor shall deliver to Agent a copy of any written
notice of default or event of default given to Grantor, such notice shall
constitute full authority and protection to Agent for any action taken or
omitted to be taken by Agent in good faith in reliance thereon to cure such
default (and any such cure shall not constitute the curing of any Default or
Event of Default under this Instrument).

5.05 Performance of Ground Lease by Grantor. Grantor will pay or cause to be
paid all rent and other charges required under the Ground Lease as and when the
same are due (without allowance for any cure or grace periods) and Grantor will
keep, observe and perform, or cause to be kept, observed and performed, all of
the other terms, covenants, provisions and agreements of the Ground Lease on the
part of the lessee thereunder to be kept, observed and performed (without
allowance for any cure or grace periods). Grantor will enforce the obligations
of the Lessor under the Ground Lease to the end that Grantor may enjoy all of
the rights granted to it under the Ground Lease.

5.06 Cure. In the event of any default in the observance or performance of any
of the terms, covenants or conditions to be observed or performed under the
Ground Lease, Agent may, at its option, cause the default or defaults to be
remedied and otherwise exercise any and all of the rights of the Grantor under
the Ground Lease in the name of and on behalf of Grantor. Agent shall promptly
provide to Grantor notice of any such action taken by Agent, but Agent’s right
to take any such action shall not be conditioned upon giving any such notice.
For the purposes of curing any breach of Grantor’s covenants contained in this
section, or in order to cure any failure of compliance, default or event of
default referred to in this section, or effecting, in whole or in part, any such
cure, Agent may do (but shall be under no obligation to do) any act or execute
any document in the name of Grantor or as its attorney-in-fact and, to
facilitate this right of Grantor,

 

34

--------------------------------------------------------------------------------

Grantor hereby irrevocably appoints Agent, with full power of substitution, its
true and lawful attorney-in-fact in its name or otherwise to do any and all acts
and to execute any and all documents which may be necessary or in the opinion of
Agent desirable to effect any such cure, or preserve any rights of the Grantor
under, or to effect compliance in whole or in part with, the Ground Lease, and
Agent and any person designated by Agent are hereby granted the right to enter
upon the Property at any time and from time to time for the purpose of taking
such action; and any and all payments made and costs incurred by Agent in
connection therewith, including reasonable attorneys’ fees, shall be secured by
this Instrument and, upon demand, shall be repaid by Grantor to Lenders with
interest thereon at the Default Rate. Grantor hereby expressly agrees that any
“Event of Default” under the Ground Lease shall constitute and be deemed to be
an Event of Default under this Instrument, which shall not be subject to notice
or right to cure prior to becoming an “Event of Default” hereunder.

5.07 No Merger. So long as the Secured Obligations shall remain unpaid, unless
Agent shall otherwise give its written consent, the fee title and the leasehold
estate in the property demised by the Ground Lease shall not merge but shall
always be kept separate and distinct, notwithstanding the union of said estates
in the Lessor, Lenders, Grantor, or any third party, whether by purchase or
otherwise. In case Grantor acquires the fee title or any other estate, title or
interest in the property demised by the Ground Lease, this Instrument shall
automatically attach to and cover and be a lien upon the fee title or such other
estate so acquired, and such fee title or other estate shall, without further
assignment, mortgage or conveyance, become and be subject to the lien of and
covered by this Instrument. Grantor agrees to execute all instruments and
documents which Agent may reasonably require to ratify, confirm and further
evidence Agent’s lien and security title on the acquired estate, title or
interest in respect of the Grantor and to deliver an endorsement to the title
policy for the Land insuring this Instrument as a first priority lien on
Grantor’s fee simple title to the Land without additional exception.
Furthermore, the Grantor hereby appoints Agent its true and lawful attorney in
fact to execute and deliver all such instruments and documents in the name and
on behalf of the Grantor. This power, being coupled with an interest, shall be
irrevocable as long as the Secured Obligations remain outstanding.

5.08 No Release. No release or forbearance of any of Grantor’s obligations under
the Ground Lease, pursuant to the Ground Lease, or otherwise, shall release
Grantor from any of its obligations under this Instrument, including its
obligation with respect to the payment of rent as provided for in the Ground
Lease and the performance of all of the terms, provisions, covenants, conditions
and agreements contained in the Ground Lease, to be kept, performed and complied
with by the tenant therein.

5.09 Elections. Grantor shall not make any election or give any consent or
approval (other than the exercise of a renewal right or extension right pursuant
to Section 5.11 below) for which a right to do so is conferred upon Grantor as
lessee under the Ground Lease without Agent’s prior written consent, which
consent shall not be unreasonably withheld, conditioned or delayed. All such
rights, together with the right of termination, cancellation, modification,
change, supplement, alteration or amendment of the Ground Lease, all of which
have been assigned for collateral purposes to Agent, shall vest in and be
exercisable solely by Agent.

 

35

--------------------------------------------------------------------------------

5.10 Arbitration Proceedings. Grantor will give Agent prompt written notice of
the commencement of any arbitration, mediation, accounting or appraisal
proceeding under and pursuant to the provisions of the Ground Lease. Agent shall
have the right to intervene and participate in any such proceeding and Grantor
shall confer with Agent to the extent which Agent deems reasonably necessary for
the protection of Agent. Upon the written request of Agent, Grantor will
exercise all rights of arbitration, mediation, accounting or appraisal conferred
upon it by the Ground Lease. Grantor shall select an arbitrator, mediator,
accountant or appraiser who is approved in writing by Agent, provided, however,
that if at the time any such proceeding shall be commenced, Grantor shall be in
default in the performance or observance of any covenant, condition or other
requirement of the Ground Lease, or an Event of Default exists under this
Instrument, on the part of Grantor to be performed or observed, or Grantor fails
to select such Person in accordance with the terms of the Ground Lease, Agent
shall have, and is hereby granted, the sole and exclusive right to designate and
appoint on behalf of Grantor the arbitrator, mediator, accountant or appraiser
in such proceeding.

5.11 Exercise of Options. Grantor may exercise any right to renew or extend the
term of the Ground Lease contained therein without the prior written consent of
Agent. Grantor shall give Agent simultaneous written notice of the exercise of
such option or right to renew or extend, together with a copy of the instrument
given to the lessor under the Ground Lease exercising such option or right, and,
thereafter, shall promptly deliver to Agent a copy of any acknowledgment by the
lessor under such Ground Lease with respect to the exercise of such option or
right. If such option or right has not been exercised as aforesaid, then not
more than one hundred eighty (180) and not less than one hundred fifty
(150) days before the right of Grantor to exercise any option or right to renew
or extend the term of the Ground Lease shall expire, Grantor shall give Agent
written notice specifying the date, term and manner for which such option or
renewal is to be exercised. Within fifteen (15) business days of written demand
by Agent, Grantor shall exercise any such option or renewal which is necessary
to extend the term of the Ground Lease beyond the term of this Instrument or to
comply with any law affecting Grantor or Agent or which is necessary, in Agent’s
reasonable judgment, to preserve the value of the security intended to be
afforded by this Instrument. Grantor shall promptly provide evidence of such
exercise of such option or right to Agent’s reasonable satisfaction. In the
event that Grantor fails to so exercise any such option or right or in the event
of any default hereunder which is continuing beyond the applicable cure periods,
Grantor hereby agrees and grants to Agent all right and authority to exercise
such option in the name of Grantor or in its own name. Notwithstanding anything
herein to the contrary, Grantor shall not exercise any purchase options, rights
of first offer or rights of first refusal in the Ground Lease without the prior
written consent of Agent, which consent shall not be unreasonably withheld,
conditioned or delayed including, without limitation, delivery of a mortgage on
the fee interest. Nothing contained herein shall affect or limit any rights of
Agent granted under the Ground Lease.

5.12 Bankruptcy.

(a) The lien of this Instrument shall attach to all of Grantor’s rights and
remedies at any time arising under or pursuant to Subsection 365(h) of the
Bankruptcy Code, 11 U.S.C. § 365(h), including, without limitation, all of
Grantor’s rights to remain in possession of the Property. In the event that the
Lessor should become subject to any bankruptcy proceedings, Grantor shall not
accept any rejection by such Person or trustee on behalf of such Person in

 

36

--------------------------------------------------------------------------------

bankruptcy as terminating the Ground Lease, but, instead, shall remain in
possession of the premises leased pursuant to the Ground Lease to the full
extent permitted by law. Without limiting the foregoing, no such acceptance of
any rejection of the Ground Lease or treatment of the Ground Lease as terminated
by Grantor shall be effective unless consented to in writing by Agent.

(b) Grantor shall not, without Agent’s prior written consent, elect to treat the
Ground Lease as terminated under Subsection 365(h)(1) of the Bankruptcy Code, 11
U.S.C. § 365(h)(1). Any such election made without Agent’s consent shall be
void. If the Ground Lease is rejected in any case, proceeding or other action
commenced by or against the Lessor (or any person or party constituting or
having an interest in the Ground Lease) under the Bankruptcy Code or any
comparable federal or state statute or law, (i) Grantor, promptly after
obtaining notice thereof, shall give written notice thereof to Agent, and
(ii) this Instrument and all the liens, terms, covenants and conditions of this
Instrument shall extend to and cover Grantor’s possessory rights under
Subsection 365(h) of the Bankruptcy Code (including all renewal and extension
rights) and to any offsets and claim for damages due to Lessor’s rejection of
the Ground Lease. In addition, Grantor hereby collaterally assigns to Agent,
Grantor’s rights to remain in possession of the premises demised under the
Ground Lease and to offset rents under the Ground Lease under Subsections
365(h)(1)(A)(ii) and 365(h)(1)(B) of the Bankruptcy Code in the event any case,
proceeding or other action is commenced by or against the Lessor under the
Bankruptcy Code or any comparable federal or state statute or law. Grantor
hereby assigns to Agent Grantor’s right under Subsection 365(d)(4)(B) to seek an
extension of the 120-day period within which Grantor must accept or reject the
Ground Lease under Subsection 365(d)(4)(A) of the Bankruptcy Code or any
comparable federal or state statute or law with respect to any case, proceeding
or other action commenced by or against Grantor under the Bankruptcy Code or
comparable federal or state statute or law. Furthermore, if Grantor shall desire
to reject the Ground Lease under the Bankruptcy Code or any comparable federal
or state statute or law, Grantor shall, at Agent’s request, assign its interest
in the Ground Lease to Agent in lieu of rejecting the Ground Lease as described
above, upon receipt by Grantor of written notice from Agent of such request
together with the agreement of Agent to cure any existing defaults of Grantor
under the Ground Lease to the extent required thereunder. Grantor hereby waives,
for the benefit of Agent, its successors and assigns only, and not enforceable
by anyone else, the provisions of Section 365 of the Bankruptcy Code or of any
other creditors rights law which gives or purports to give Grantor any right of
election to terminate the Ground Lease, to acquiesce in the termination of the
Ground Lease or to surrender possession of the Property in the event of any
bankruptcy or other debtor relief proceeding of Grantor or any other Person
including, without limitation, Lessor.

(c) In the event Lessor, as debtor in possession, or a trustee for Lessor,
attempts to transfer its interest in the Land and the Improvements free and
clear of the Ground Lease pursuant to Section 363 of the Bankruptcy Code or
pursuant to any other creditors rights law, Grantor shall not consent, acquiesce
or fail to object to such attempted transfer. Any such consent, acquiescence or
failure to object shall be null and void. In any event, Grantor hereby waives,
for the benefit of Agent, its successors and assigns only, and not enforceable
by anyone else, the provisions of Section 363 of the Bankruptcy Code or of any
other creditors rights law which gives or purports to give Grantor or Lessor any
right to consent to or acquiesce in the transfer of the Lessor’s interest in the
Land and the Improvements free and clear of the Ground Lease, to acquiesce in
the termination of the Ground Lease or to surrender possession of the Property
in the event of any bankruptcy or other debtor relief proceeding of Lessor or
any other Person.

 

37

--------------------------------------------------------------------------------

(d) Grantor hereby unconditionally assigns, transfers and sets over to Agent all
of Grantor’s claims and rights to offsets and the payment of damages arising
from any rejection of the Ground Lease by Lessor or any other fee owner of the
Property under the Bankruptcy Code. Agent shall have the right to proceed in its
own name or in the name of Grantor in respect of any offsets, claim, suit,
action or proceeding relating to the rejection of the Ground Lease, including,
without limitation, the right to file and prosecute, either in its own name or
in the name of Grantor, any proofs of claim, complaints, motions, applications,
notices and other documents, in any case in respect to the Lessor or any fee
owner under the Bankruptcy Code. This assignment constitutes a present,
irrevocable and unconditional assignment of the foregoing offsets, claims,
rights and remedies, and shall continue in effect until all of the Secured
Obligations have been satisfied and discharged in full. Any amounts received by
Agent as damages arising out of the rejection of the Ground Lease as aforesaid
shall be applied first to all costs and expenses of Agent (including, without
limitation, attorneys’ fees) incurred in connection with the exercise of any of
its rights or remedies under this Section and then in accordance with the
provisions of the Loan Documents. Grantor shall promptly make, execute,
acknowledge and deliver, in form and substance satisfactory to Agent, a UCC
Financing Statement (Form UCC 1) and all such additional instruments, agreements
and other documents, as may at any time hereafter be required by Agent to
effectuate and carry out the assignment made pursuant to this Section and any
other powers granted to Agent.

(e) If pursuant to Subsection 365(h)(1)(B) of the Bankruptcy Code, 11 U.S.C. §
365(h)(1)(B), Grantor shall seek to offset against the rent reserved in the
Ground Lease the amount of any damages caused by the nonperformance by the
Lessor or any fee owner of any of their obligations under the Ground Lease after
the rejection by the Lessor or any fee owner of the Ground Lease under the
Bankruptcy Code, Grantor shall, prior to effecting such offset, notify Agent in
writing of its intent to do so, setting forth the amounts proposed to be so
offset and the basis therefor. Agent shall have the right to object to all or
any part of such offset that, in the reasonable judgment of Agent, would
constitute a breach of the Ground Lease, and in the event of such objection,
Grantor shall not effect any offset of the amounts so objected to by Agent.
Neither Agent’s failure to object as aforesaid nor any objection relating to
such offset shall constitute an approval of any such offset by Agent.

(f) If any action, proceeding, motion or notice shall be commenced or filed in
respect of the Lessor or any fee owner, the Property or the Ground Lease in
connection with any case under the Bankruptcy Code, Agent shall have the option,
exercisable upon written notice from Agent to Grantor, to conduct and control
any such litigation with counsel of Agent’s choice. Agent may proceed in its own
name or in the name of Grantor in connection with any such litigation, and
Grantor agrees to execute any and all powers, authorizations, consents or other
documents reasonably required by Agent in connection therewith. Grantor shall,
upon demand, pay to Agent all costs and expenses (including attorneys’ fees)
paid or incurred by Agent in connection with the prosecution or conduct of any
such proceedings. Any such costs or expenses not paid by Grantor as aforesaid
shall be secured by the lien of this Instrument and shall be added to the
principal amount of the indebtedness secured hereby. Grantor shall not

 

38

--------------------------------------------------------------------------------

commence any action, suit, proceeding or case, or file any application or make
any motion (unless such motion is for the purpose of protecting the Ground Lease
and its value as security for the obligations secured by this Instrument), in
respect of the Ground Lease in any such case under the Bankruptcy Code without
the prior written consent of Agent, which consent shall not be unreasonably
withheld, conditioned or delayed.

(g) Grantor shall, after obtaining knowledge thereof, promptly notify Agent in
writing of any filing by or against the Lessor or other fee owner of a petition
under the Bankruptcy Code. Grantor shall promptly deliver to Agent, following
receipt, copies of any and all notices, summonses, pleadings, applications and
other documents received by Grantor in connection with any such petition and any
proceedings relating thereto.

(h) If there shall be filed by or against Grantor a petition under the
Bankruptcy Code and Grantor, as lessee under the Ground Lease, shall determine
to reject the Ground Lease pursuant to Section 365(a) of the Bankruptcy Code,
Grantor shall give Agent not less than thirty (30) days’ prior written notice of
the date on which Grantor shall apply to the Bankruptcy Court for authority to
reject the Ground Lease. Agent shall have the right, but not the obligation, to
serve upon Grantor within such thirty (30) day period a notice stating that
Agent demands that Grantor assume and assign the Ground Lease to Agent pursuant
to Section 365 of the Bankruptcy Code. If Agent shall serve upon Grantor the
notice described in the preceding sentence, Grantor shall not seek to reject the
Ground Lease and shall comply with the demand provided for in the preceding
sentence.

5.13 No Assumption. Notwithstanding anything to the contrary contained herein,
this Instrument shall constitute an assignment of the Ground Lease for
collateral purposes only and Agent shall have no liability or obligation
thereunder by reason of its acceptance of this Instrument.

5.14 New Lease. If the Ground Lease is canceled or terminated, and if Agent or
its nominee shall acquire an interest in any new lease of the property demised
thereby, Grantor shall have no right, title or interest in or to the new lease
or the leasehold estate created by such new lease.

5.15 Estoppel. Within twenty (20) days after written demand by Agent, Grantor
shall use commercially reasonable efforts to cause the Lessor deliver an
estoppel certificate in a form substantially similar to that estoppel
certificate being delivered by the Lessor to Agent on or around the date hereof,
among other things, setting forth (i) the name of the tenant thereunder,
(ii) that the Ground Lease has not been modified or, if it has been modified,
the date of each modification (together with copies of each such modification),
(iii) the basic rent payable under the Ground Lease, (iv) the date to which all
rental charges have been paid by the tenant under the Ground Lease, (v) whether
there are any alleged defaults of the tenant under the Ground Lease and, if
there are, setting forth the nature thereof in reasonable detail, and (vi) such
other matters as may be reasonably requested by Agent.

5.16 Liability. Agent shall be liable for the obligations of Grantor arising
under the Ground Lease for only that period of time which Agent has acquired, by
foreclosure or otherwise, and is holding all of the Grantor’s right, title and
interest therein.

 

39

--------------------------------------------------------------------------------

5.17 Liens Upon Fee. In the event any lien or encumbrance, other than those
exceptions shown in the title policy in favor of Agent insuring the lien of this
Instrument, now or hereafter exists upon the fee title of Lessor under the
Ground Lease or the leasehold estate, Grantor will do or cause to be done
everything necessary to preserve and protect: (i) the leasehold estate, from
loss by reason of sale under or foreclosure of any such lien or encumbrance; and
(ii) the title and possession of the leasehold estate so that these presents
shall be and continue to be a first and prior lien on all of the Property,
subject only to those exceptions shown in the title policy in favor of Agent
insuring the lien of this Instrument.

ARTICLE 6–COMPLIANCE WITH CREDIT AGREEMENT

6.01 Representations and Warranties. In addition to the representations and
warranties made by Grantor herein, Grantor hereby makes to the Agent and the
Lenders the representations and warranties set forth in the Credit Agreement
applicable to it, as if it were a party thereto, including, without limitation,
those contained in the following sections: Sections 6.1(c) and (d), 6.2, 6.6,
6.7, 6.8, 6.9, 6.10, 6.12, 6.14, 6.15, 6.16, 6.17, 6.20, 6.23, 6.25, 6.26, 6.27,
6.28, 6.29, 6.30 and 6.32.

6.02 Covenants and Agreements. The Grantor covenants and agrees that so long as
any Loan, Note or Letter of Credit is outstanding that Grantor shall comply with
all of the covenants and agreements set forth in the Credit Agreement applicable
to it, as if it were a party thereto, including, without limitation, those
contained in the following sections: Sections 7.2, 7.3, 7.4(e), 7.5(a), (b),
(c), and (d), 7.6, 7.7 (to the extent required by Section 1.05 hereof), 7.8,
7.9, 7.10, 7.11, 7.12, 7.13, 7.14, 7.16, 7.19, 8.1, 8.2, 8.3, 8.4, 8.5, 8.6,
8.8, 8.10, 8.12, 8.13, 8.14, 8.15, 18.9, 21, and 25. For purposes of Sections
7.5(a), (b), (c) and (d) of the Credit Agreement, notice given to Agent by
Borrower shall satisfy any requirement that Grantor deliver notice under the
relevant section.

[SIGNATURES ON NEXT PAGE]

 

40

--------------------------------------------------------------------------------

THIS INSTRUMENT AND THE OTHER LOAN DOCUMENTS EMBODY THE FINAL, ENTIRE AGREEMENT
AMONG THE PARTIES HERETO AND SUPERSEDE ANY AND ALL PRIOR COMMITMENTS,
AGREEMENTS, REPRESENTATIONS AND UNDERSTANDINGS, WHETHER WRITTEN OR ORAL,
RELATING TO THE SUBJECT MATTER HEREOF AND THEREOF AND MAY NOT BE CONTRADICTED OR
VARIED BY EVIDENCE OR PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OR
DISCUSSIONS OF THE PARTIES HERETO. THERE ARE NO ORAL AGREEMENTS AMONG THE
PARTIES HERETO.

IN WITNESS WHEREOF, Grantor has executed this Instrument as of the day and year
first above written.

 

GRANTOR:

 

HC-5101 MEDICAL DRIVE, LLC,

a Delaware limited liability company

 

By:   Carter/Validus Operating Partnership, LP, a Delaware limited partnership,
its sole member

 

By:   Carter Validus Mission Critical REIT, Inc., a Maryland corporation, its
General Partner

              By:   /s/ John E. Carter               Name:   John E. Carter  
            Title:   Chief Executive Officer

[Acknowledgment Appears on Next Page]

KeyBank/Carter/Validus Operating Partnership, LP – Post Acute Warm Springs
Hospital –

Signature Page to Leasehold Deed of Trust, Security Agreement and Assignment of
Leases and Rents

--------------------------------------------------------------------------------

ACKNOWLEDGMENT

 

THE STATE OF Florida

   §    §

COUNTY OF Hillsborough

   §

This instrument was acknowledged before me on November             , 2013, by
John E. Carter, as Chief Executive Officer of Carter Validus Mission Critical
REIT, Inc., a Maryland corporation, which is the general partner of
Carter/Validus Operating Partnership, LP, a Delaware limited partnership, which
is the sole member of HC-5101 Medical Drive, LLC, a Delaware limited liability
company, on behalf of said limited liability company.

 

(SEAL)

     /s/ Demetra Elliott                                              Notary
Public

My Commission Expires:

     Print Name of Notary:

2/11/15

     Demetra Elliott

KeyBank/Carter/Validus Operating Partnership, LP – Post Acute Warm Springs
Hospital –

Signature Page to Leasehold Deed of Trust, Security Agreement and Assignment of
Leases and Rents

--------------------------------------------------------------------------------

EXHIBIT “A”

Legal Description

Real property in the County of Bexar, State of Texas, described as follows:

TRACT I

Parcel “A”

A 4.974 acre (216,660 square foot) tract of land out of an 11.433 acre tract,
out of the Manuel Tejada Survey No. 89, and out of New City Block 13663, San
Antonio, Bexar County, Texas and being more particularly described as follows:

Beginning: at a set  1⁄2” iron pin, the South corner of this tract, which is N
45° 19’ 46” E 269.59 feet along the Northwest right-of-way line of Medical
Drive, 1098.02 feet with the Northwest right-of-way line of Medical Drive and
the arc of a curve to the right, concave to the South, which has a radius of
2060.19 feet, a central angle of 30° 32’ 13”, and a chord bearing of N 60° 35’
49” E, N 28° 16’ 23” W 631.12 feet, and N 31° 43’ 37” E 27.71 feet from the
intersection of the Northeast right-of-way line of Babcock Road with the
Northwest right-of-way line of Medical Drive;

Thence: N 28° 16’ 23” W 171.61 feet to a set  1⁄2” iron pin, the point of
curvature of a curve to the left;

Thence: 36.28 feet with the arc of the curve to the left, concave to the West,
which has a radius of 218.50 feet, a central angle of 09° 30’ 44”, and a chord
bearing of N 33° 01’ 45” W to a set  1⁄2” iron pin, a point of reverse
curvature;

Thence: 30.13 feet with the arc of the curve to the right, concave to the East,
which has a radius of 181.50 feet, a central angle of 09° 30’ 44”, and a chord
bearing of N 33° 01’ 45” W to a set  1⁄2” iron pin, the point of tangency of
this curve;

Thence: N 28° 16’ 23” W 260.42 feet to a set  1⁄2” iron pin, the West corner of
this tract;

Thence: N 31° 43’ 37” E 376.34 feet to a set  1⁄2” iron pin, the North corner of
this tract;

Thence: S 58° 16’ 23” E 434.15 feet to a set  1⁄2” iron pin, the East corner of
this tract;

Thence: S 31° 43’ 37” W 620.65 feet to the point of beginning, containing 4.974
acres (216,660 square feet).

 

EXHIBIT “A” - PAGE 1

--------------------------------------------------------------------------------

TRACT I

Parcel “B”

A 3.502 acre green belt tract (152,564 square feet) of land out of a 11.433 acre
tract of land out of the Manuel Tejada Survey No. 89, and out of NCB 13663, San
Antonio, Bexar County, Texas, and being more particularly described as follows:

Beginning: at a found  1⁄2” iron pin on the North right-of-way line of Medical
Drive for the Southwest corner of this 3.502 acre green belt tract, said point
being N 45° 19’ 43” E 269.59 feet along the Northwest right-of-way line of
Medical Drive to the point of curvature of a curve to the right, concave to the
South, 1098.02 feet with said curve which has a radius of 2060.19 feet, a
central angle of 30° 32’ 13”, a chord bearing of N 60° 35’ 49” E from the
intersection of the Northeast right-of-way line of Babcock Road with the
Northwest right-of-way line of Medical Drive;

Thence: N 28° 16’ 23” W 39.81 feet to a set  1⁄2” iron pin, the point of
curvature of a curve to the right;

Thence: 63.19 feet along the curve to the right, concave to the East, which has
a radius of 181.50 feet, a central angle of 19° 56’ 54”, a chord bearing of N
18° 17’ 56” W to a set  1⁄2” iron pin, the point of reverse curvature of a curve
to the left;

Thence: 76.07 feet along the curve to the left concave to the West, which has a
radius of 218.50 feet, a central angle of 19° 56’ 54”, a chord bearing of N 18°
17’ 66” W to a set  1⁄2” iron pin, the point of tangency of this curve;

Thence: N 28° 16’ 23” W 468.70 feet to a set  1⁄2” iron pin, the West corner of
this tract;

Thence: N 31° 43’ 37” E 620.65 feet to a set  1⁄2” iron pin, the North corner of
this tract;

Thence: S 58° 16’ 23” E 173.65 feet to a set  1⁄2” iron pin, the East corner of
this tract and non-tangent point of curvature of a curve to the right;

Thence: 80.27 feet along said curve to the right, concave to the West, which has
a radius of 200.00 feet, a central angle of 22° 59’ 46”, a chord bearing of S
27° 54’ 23” W, to a set  1⁄2” iron pin, a point of compound curvature;

Thence: 77.89 feet along a curve to the right, concave to the West, which has a
radius of 150.00 feet, a central angle of 29° 45’ 00”, a chord bearing of S 54°
16’ 46” W to a set  1⁄2” iron pin, the point of tangency of this curve;

Thence: S 69° 09’ 16” W 25.00 feet to a set  1⁄2” iron pin, the point of
curvature of a curve to the left;

 

EXHIBIT “A” - PAGE 2

--------------------------------------------------------------------------------

Thence: 239.98 feet along the curve to the left, concave to the East, which has
a radius of 200.00 feet, a central angle of 68° 45’ 00”, a chord bearing of S
34° 46’ 46” W to a set  1⁄2” iron pin, the point of tangency of said curve;

Thence: S 00° 24’ 16” W 63.11 feet to a set  1⁄2” iron pin, the point of
curvature of a curve to the left;

Thence: 166.12 feet along the curve to the left, concave to the East, which has
a radius of 800.00 feet, a central angle of 11° 53’ 50”, a chord bearing of S
05° 32’ 39” E, to a set  1⁄2” iron pin, the point of tangency of this curve;

Thence: S 11° 29’ 34” E 476.05 feet to a set  1⁄2” iron pin on the north
right-of-way line of Medical Drive, a non-tangent point of curvature of a curve
to the left;

Thence: 49.46 feet along the curve to the left, concave to the South, which has
a radius of 2060.19 feet, a central angle of 01° 22’ 32” a chord bearing of S
76° 33’ 12” W to the point of beginning of this 3.502 acre green belt tract.

TRACT I

Parcel “C”

A 0.532 acre (23,186 square foot) access easement out of an 11.433 acre tract,
out of the Manuel Tejada Survey No. 89, and out of New City Block 13663, San
Antonio, Bexar county, Texas; and being more particularly described as follows:

Beginning: at the South corner of this tract, which is S 28° 16’ 23” E 39.81, N
45° 19’ 46” E 269.59 feet along the Northwest right-of-way line of Medical
Drive, 1098.02 feet with the Northwest right-of-way line of Medical Drive and
the arc of a curve to the right, concave to the South, which has a radius of
2060.19 feet, a central angle of 30° 32’ 13”, and a chord bearing of N 60° 35’
49” E, N 28° 16’ 23” W 631.12 feet, and N 31° 43’ 37” E 27.71 feet form the
intersection of the Northeast right-of-way line of Babcock Road with the
Northwest right-of-way line of Medical Drive;

Thence: N 28° 16’ 23” W 1092.62 feet to the Southwest corner;

Thence: N 31° 43’ 37” E 21.36 feet to the Northwest corner;

Thence: S 28° 16’ 23” E 260.42 feet to the point of curvature of a curve to the
left, thence: 30.13 feet with the curve to the left, concave to the Northeast,
which has a radius of 181.50 feet, a central angle of 09° 30’ 44”, a chord
bearing of S 33° 01’ 45” E and a chord distance of 30.10 feet to a point of
reverse curvature;

 

EXHIBIT “A” - PAGE 3

--------------------------------------------------------------------------------

Thence: 36.28 feet with this curve to the right, concave to the Southwest, which
has a radius of 218.50 feet, a central angle of 09° 30’ 44”, a chord bearing of
S 33° 01’ 45” E and a chord distance of 36.23 feet to the point of tangency of
the curve;

Thence: S 28° 16’ 23” E 640.31 feet to the point of curvature of curve to the
right;

Thence: 76.07 feet with the curve to the right, concave to the West, which has a
radius of 218.50 feet, a central angle of 19° 56’ 64”, a chord bearing S 18° 17’
56” E and a chord distance of 75.69 feet to a point of reverse curvature;

Thence: 63.19 feet with this curve to the left, concave to the East, which has a
radius of 181.50 feet, a central angle of 19° 56’ 54”, a chord bearing of S 18°
17’ 56” E and a chord distance of 62.87 feet to the point of beginning,
containing 0.532 acres (23,185 square feet).

TRACT II

A 0.473 acre (20,583 square foot) ingress and egress easement on Lot 8, New City
Block 13663, Villa Rosa Subdivision, San Antonio, Texas, as recorded in Volume
6100 on Page 96 of the deed and plat records of Bexar County, Texas; and being
more particularly described as follows:

Beginning: at a found  1⁄2” iron pin on the Northwest right-of-way line of
Medical Drive, being the South corner of an 11.433 acre tract out of the Manuel
Tejada Survey No. 89, New City Block 13663, and being the East corner, of Lot 8,
and the East corner of this easement, which is, with the Northwest right-of-way
line of Medical Drive, N 45° 19’ 43” E 269.59 feet, 1098.02 feet with a curve to
the right, which has a radius of 2060.19 feet and a central angle of 30° 32’ 19”
from the intersection of the Northwest right-of way line of Medical Drive and
the Northeast right-of-way line of Babcock Road;

Thence: 39.44 feet with the Northwest right-of-way line of Medical Drive and
with a curve to the left, concave to the Southeast, which has a radius of
2060.19 feet, a central angle of 01° 05’ 49”, and a chord bearing of S 75° 19’
01” W for a chord length of 39.44 feet to the end of this curve and the
beginning of a non-tangent curve to the left;

Thence: 6.38 feet with the curve to the left, concave to the West, which has a
radius of 15.00 feet, a central angle of 24° 22’ 28”, and a chord bearing of N
16° 05’ 09” W for a chord length of 6.33 feet to the point of tangency of this
curve;

Thence: N 28° 16’ 23” W 24.35 feet to the point of curvature of a curve to the
right;

Thence: 76.07 feet with the curve to the right, concave to the East, which has a
radius of 218.50 feet, a central angle of 19° 56’ 54” and a chord bearing of N
18° 17’ 56 “W for a chord length of 75.69 feet, to a point of reverse curvature;

Thence: 63.19 feet with a curve to the left, concave to the West, which has a
radius of 181.50 feet, a central angle of 19° 56’ 54”, and a chord bearing of N
18° 17’ 56” W for a chord length of 62.87 feet, to the point of tangency of this
curve;

 

EXHIBIT “A” - PAGE 4

--------------------------------------------------------------------------------

Thence: N 28° 16’ 23” W 640.31 feet to the point of curvature of a curve to the
left;

Thence: 30.12 feet with the curve to the left, concave to the Southwest, which
has a radius of 181.50 feet, a central angle of 09° 30’ 44”, and a chord bearing
of N 33° 01’ 45” W for a chord length of 30.13 feet, to a point of reverse
curvature;

Thence: 36.28 feet with a curve to the right, concave to the Northeast, which
has a radius of 218.05 feet, a central angle of 09° 30’ 44”, and a chord bearing
of N 33° 01’ 45” W for a chord length of 36.23 feet, to the point of tangency of
this curve;

Thence: N 28° 16’ 23” W 348.18 feet to the West corner of this easement;

Thence: N 61° 43’ 37” E 18.50 feet to a found  1⁄2” iron pin on the Northeast
line of Lot 8, the North corner of this easement and the West corner of the
11.433 acre tract;

Thence: S 28° 16’ 23” E 1230.87 feet with the Northeast line of Lot 8, the
Southwest line of the 11.433 acre tract, to the point of beginning, containing
0.473 acres (20,583 square feet).

TRACT III

A 2.425 acre (105,610 square foot) expansion area tract out of an 11.433 acre
tract, out of the Manuel Tejada Survey No. 89, and out of New City Block 13663,
San Antonio, Bexar County, Texas, and being more particularly described as
follows:

Beginning: at a found  1⁄2” iron pin, the Southwest corner of this tract, which
is S 28° 16’ 23” E 1230.87 feet, N 45° 19’ 46” E 269.59 feet along the Northwest
right-of-way line of Medical Drive, 1098.02 feet with the Northwest right-of-way
line of Medical Drive and the arc of a curve to the right, concave to the South,
which has a radius of 2060.19 feet, a central angle of 30° 32’ 13”, and a chord
bearing of N 60° 35’ 49” E, N 28° 16’ 23” W 631.12 feet, and N 31° 43’ 37” E
27.71 feet from the intersection of the North right-of-way line of Babcock Road
with the Northwest right-of-way line of Medical Drive;

Thence: N 31° 43’ 37” E 458.49 feet to a found  1⁄2” iron pin, the North corner
of this tract;

Thence: S 58° 16’ 23” E 646.18 feet to a found  1⁄2” iron pin, the beginning of
a non-tangent curve to the right;

Thence: 18.00 feet with the curve to the right, concave to the West which has a
radius of 250.00 feet, a central angle of 04° 07’ 31”, a chord bearing of S 05°
50’ 30” W, and a chord distance of 18.00 feet, to the point of tangency of the
curve;

Thence: S 07° 54’ 16” W 72.00 feet to the point of curvature of a curve to the
right;

Thence: 29.68 feet with the curve to the right, concave to the West, which has a
radius of 200.00 feet, a central of 08° 30’ 14”, a chord bearing of S 12° 09’
23° W, and a chord distance of 29.66 feet to a corner of this tract;

Thence: N 58° 16’ 23” W 607.80 feet to a found  1⁄2” iron pin, an interior
corner of this tract;

 

EXHIBIT “A” - PAGE 5

--------------------------------------------------------------------------------

Thence: S 31° 43’ 37” W 397.71 feet to a found  1⁄2” iron pin, a corner of this
tract;

Thence: N 28° 16’ 23” W 98.44 feet to the point of beginning containing 2.425
acres (105,610 square feet).

Tract III being also described as that certain 2.424 acre tract, as more fully
described on Exhibit “A” of that certain First Amendment to Lease Agreement and
Access Easement Agreement dated as of September 25, 2000 and recorded on
October 18, 2000 in Volume 8609, Page 1533, of the Official Records of Bexar
County, Texas, which alternative description is incorporated herein by
reference.

TRACT IV:

A 1.348 acre (58,701 square feet) tract being partially out of a called 134.410
acre tract as recorded in Volume 5417, Page 471, and partially out of a called
114.16 acre tract as record in Volume 4703, Page 249, said 134.410 acre tract
and 114.16 acre tract being a portion of the Manuel Tejada Survey No. 89 and
situated within New City Block 13663. City of San Antonio, Bexar County, Texas
and being more particularly described as follows:

Commencing: at a set  1⁄2” iron rod at the, westernmost corner of Lot 22, New
City Block 13663, Warm Springs Subdivision (Plat Book 9517, Page 71) same being
a corner in the Northeasterly line of Lot 8, NCB 13663, Villa Rosa Subdivision
(Plat Book 6100, Page 96);

Thence: N 28° 16’ 23” W 98.44 feet along and with the Northeasterly line of said
Lot 8, to a set  1⁄2” iron rod;

Thence: N 31° 43’ 37” E 456.49 feet to a set  1⁄2” iron rod;

Thence S 58° 16’ 23” E 214.30 feet to a set  1⁄2” iron rod, the Westernmost
point of beginning of the herein described 1.348 acres);

Thence: N 48° 24’ 16” E 662.58 feet to a set  1⁄2” iron rod in the Southwest
right-of-way line of Floyd Curl Drive, an 86 foot right-of-way (Plat Book 9517,
Page 150) said iron rod also being a point on a curve concave Northeasterly;

Thence: 30.00 feet along and with the Southwest right-of-way line of Floyd Curl
Drive and said curve, having a radius of 1,740.88 feet, a central angle of 00°
59’ 15” and a chord bearing and distance of S 42° 15’ 00” E 30.00 feet to a set
 1⁄2” iron rod at the point of intersection of the Southwest right-of-way line
of Floyd Curl Drive and its intersection with the Northwest line of varying
width drainage and sanitary sewer easement as recorded in Plat Book 9522, Page
14;

Thence: S 48° 24’ 16” N 253.12 feet along and with the Northwest line of said
easement to a set  1⁄2” iron rod at the point of curvature of a curve concave to
the East;

Thence: 331.52 feet continuing along with said easement line and curve, having a
radius of 276.29 feet, a central angle of 68° 45’ 00” and a chord bearing and
distance of s 14° 01’ 46” W 311.99 feet to a set  1⁄2” iron rod;

 

EXHIBIT “A” - PAGE 6

--------------------------------------------------------------------------------

Thence: S 20° 20’ 44” E 101.55 feet continuing along and with said easement line
to a set  1⁄2” iron rod at the point of curvature of a curve concave
Southwesterly;

Thence: 35.33 feet continuing along and with said easement line having a radius
of 179.52 feet, a central angle of 11° 16’ 30”, and a chord bearing and distance
of S 14° 42’ 29” E 35.27 feet to a set  1⁄2” iron rod at the Southern most
corner of this description, said iron rod also being at a point in the
Northeasterly line of a proposed 2.424 acre tract;

Thence: N 58° 16’ 23” W 346.84 feet along and with the Northeast line of said
proposed 2.424 acre tract to the point of beginning.

 

EXHIBIT “A” - PAGE 7

--------------------------------------------------------------------------------

EXHIBIT “B”

Permitted Encumbrances

Permitted Encumbrances are such matters as are shown on Schedule B to the Pro
Forma Loan Title Insurance Policy, File No.: NCS-636401-HOU1, issued by First
American Title Insurance Company to the Agent in connection with this
Instrument.

 

EXHIBIT “B” - PAGE 1

--------------------------------------------------------------------------------

EXHIBIT “C”

Schedule 1

(Description of “Debtor” and “Secured Party”)

 

A. Debtor:

 

  1. HC-5101 MEDICAL DRIVE, LLC, a limited liability company organized under the
laws of the State of Delaware. Debtor has been using or operating under said
name and identity or corporate structure without change since October 9, 2013.

 

     Names and Tradenames used within last five years:

None.

 

     Location of all chief executive offices over last five years:

4211 W. Boy Scout Boulevard, Suite 500, Tampa, Florida 33607.

 

    Organizational Number: 5412317

 

    Federal Tax Identification Number: 90-1021746

 

B. Secured Party:

KEYBANK NATIONAL ASSOCIATION, a national banking association, as Agent.

 

EXHIBIT “C” - PAGE 1

--------------------------------------------------------------------------------

Schedule 2

(Notice Mailing Addresses of “Debtor” and “Secured Party”)

 

A. The mailing address of Debtor is:

HC-5101 Medical Drive, LLC

4211 W. Boy Scout Boulevard

Suite 500

Tampa, Florida 33607

Attn: Todd Sakow, Chief Financial Officer

 

B. The mailing address of Secured Party is:

KeyBank National Association

4910 Tiedeman Road

3rd Floor

Brooklyn, Ohio 44144

Attn: Real Estate Capital Services

 

Schedule 2 - Page 1