**Exhibit10.15**

 

NOTICE OFCONFIDENTIALITY RIGHTS: IF YOU ARE A NATURAL PERSON, YOU MAY REMOVE OR STRIKEANY OF THE FOLLOWING INFORMATION FROM THIS INSTRUMENT BEFORE IT IS FILED FORRECORD IN THE PUBLIC RECORDS: YOUR SOCIAL SECURITY NUMBER OR YOUR DRIVER’S LICENSENUMBER.

 

DEED OF TRUST, ASSIGNMENT OF RENTS,

SECURITY AGREEMENT AND FINANCING STATEMENT

 
| THE STATE OF  TEXAS | § |                             |
|---------------------|--------|----------------------------------|
|                | § | KNOW ALL MEN  BY THESE PRESENTS: |
| COUNTY OF  BEXAR    | § |                             |

 

THAT I, WE, orEITHER OF US, LANCER PARTNERSHIP, LTD., a Texas limited partnership of the Countyof BEXAR, State of TEXAS, sometimes hereinafter called Grantors (whether one ormore) for the purposes of securing the indebtedness hereinafter described, andin consideration of the sum of TEN DOLLARS ($10.00) to us in hand paid by theTrustee hereinafter named, the receipt and sufficiency of which is herebyacknowledged, and for the further consideration of the uses, purposes and thetrusts hereinafter set forth, have GRANTED, SOLD AND CONVEYED, and by thesepresents do GRANT, SELL and CONVEY, unto STEVE E. EDLUND Trustee, of InternationalBank of Commerce, 130 E. Travis, San Antonio, Bexar County, Texas 78205 and hissubstitutes or successors, all of the following described property situated in BEXARCounty, Texas (hereinafter the “Property”), to-wit:

 

THAT CERTAINREAL PROPERTY LOCATED IN BEXAR COUNTY, TEXAS BEING MORE PARTICULARLY DESCRIBEDON EXHIBIT “A” ATTACHED HERETO AND INCORPORATED HEREIN.

 

TO HAVE AND TOHOLD the above described Property, together with the rights, privileges and appurtenancesthereto belonging unto the said Trustee, and to his substitutes or successorsforever and Grantors do hereby bind themselves, their heirs, executers,administrators and assigns to warrant and forever defend the said premises untothe said Trustee, his substitutes or successors and assigns forever, againstthe claim or claims, of all persons claiming or to claim the same any partthereof.

 

Thisconveyance, however, is made in TRUST to secure payment of one /Promissory Notedated of even date, in the principal sum of FIFTEEN MILLION AND NO/ 100 DOLLARS($15,000,000.00) (the “Note”), executed by the makers of said Note,  LANCERPARTNERSHIP, LTD., a Texas limited partnership who together with the abovenamed Grantors, shall hereinafter collectively and interchangeably be referredto as Grantors, payable to the order of INTERNATIONAL BANK OF COMMERCE,hereinafter referred to as Beneficiary, in the City of SAN ANTONIO, BEXAR County,Texas and payable as therein provided, including late charges; bearing interestas therein stipulated, providing for acceleration of maturity and forreasonable and necessary attorney’s fees;

 

ShouldGrantors do and perform all of the covenants and agreements herein contained,and make payment of said indebtedness as the same shall become due and payable,then this conveyance shall become null and void and of no further force andeffect, and shall be released at the expense of Grantors, by the holderthereof, hereinafter called Beneficiary (whether one or more).

 

Grantors COVENANTand AGREE as follows:

 

That they arelawfully seized of said Property, in fee simple absolute, and have the right toconvey the same; that said Property is free from all liens and encumbrances,except as herein provided.

 

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To protect thetitle and possession of said property and to pay when due all taxes andassessments now existing or hereafter levied or assessed upon said Property, orthe interest therein created by this Deed Of Trust, and to preserve andmaintain the lien hereby created as a first and prior lien on said Propertyincluding any improvements hereafter made a part of the realty.

 

To keep theimprovements on said Property in good repair and condition, and not to permitor commit any waste thereof; to keep said buildings occupied so as not toimpair the insurance carried thereon.

 

To insure andkeep insured all improvements now or hereafter created upon said Propertyagainst loss or damage by fire and wind-storm, and any other hazard or hazardsas may be reasonably required from time to time by Beneficiary during the termof the indebtedness hereby secured, to the extent of the total amount of theindebtedness hereby secured, or to the extent of the full insurable value ofsaid improvements, whichever is the lesser, in such form and with suchinsurance company or companies as may be approved by Beneficiary, and todeliver to Beneficiary*; any proceeds which Beneficiary may receive under suchpolicy or policies, may be applied by Beneficiary, at its option, to reduce theindebtedness hereby secured, whether then matured or to mature in the future,and in such manner as Beneficiary may elect, or Beneficiary may permit Grantorsto use said proceeds to repair or replace all improvements damaged or destroyedand covered by said policy.

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* suchcertificates of insurance as Beneficiary may request;

 

ThatBeneficiary may employ counsel for advice or other legal service at Beneficiary’sdiscretion in connection with any dispute as to the debt hereby secured or liensecuring same or this instrument, or any litigation or arbitration proceedingto which the Beneficiary may be made a party on account of this lien or whichmay affect the title to the Property on account of this lien or which mayaffect the title to the Property securing the indebtedness hereby secured orwhich may affect said debt or lien. Any reasonable and necessary attorney’sfees so incurred shall be added and be part of the debt hereby secured.

 

In addition tothe land and improvements above described, the lien of this Deed Of Trustcovers and includes all abstracts and title papers furnished or to be furnishedin connection with the making of the loan evidenced by said Note, the paymentof which is secured hereby.

 

Grantors agreeto pay on demand for attorney’s fees incurred in connection with either theclosing of the loan secured hereby or the renewal, extension, modificationand/or rearrangement of any part of the indebtedness secured hereby, or, in thealternative, such amounts expended by Beneficiary shall be added to and be apart of the debt hereby secured.

 

That in theevent Grantors shall fail to keep the improvements on the Property herebyconveyed in good repair and condition, or to pay promptly when due all taxesand assessments, as aforesaid, or to preserve the prior lien of this Deed OfTrust on said Property or to keep the buildings and improvements insured, asaforesaid, or to deliver the policy, or policies, of insurance or the renewalthereof to Beneficiary, as aforesaid, then Beneficiary may, at his option, butwithout being required to do so, make such repairs, pay such taxes andassessments, purchase any tax title thereon, remove any prior liens, andprosecute or defend any suits in relation to the preservation of the prior lienof this Deed Of Trust on said Property, or insure and keep insured theimprovements thereon in any amount not to exceed that above stipulated; thatany sums which may be so paid out by Beneficiary, including the costs, expensesand attorney’s fees paid in any suit affecting said Property when necessary toprotect the lien hereof and all other expenses and costs agreed to be paid byGrantors under the Deed Of Trust which are not paid when due shall bearinterest from the dates of such payments at the prematurity interest ratestated in the Note hereby secured, and shall be deemed a part of the debthereby secured and recoverable as such in all respects. In addition, in theevent Grantors shall fail to keep the buildings and improvements insured, as aforesaid,or to deliver the policy or policies, of insurance or the renewal thereof tothe Beneficiary, as aforesaid, the Beneficiary may, at his option, but withoutbeing required to do so, insure and keep insured the improvements thereon inany amount not to exceed that above stipulated (including without limitation,to the extent allowed by law, the purchase of Single Interest Insurance whichmay provide coverage only for Beneficiary); that all sums paid for insurancepremiums by Beneficiary, as aforesaid, shall bear interest from the dates ofsuch payments at the prematurity interest rate contracted for in the Notehereby secured, and shall be paid by Grantors to Beneficiary upon demand, atthe same place at which the above-described Note is payable, and shall bedeemed a part of the debt hereby secured and recoverable as such in allrespects.

 

Grantorsexpressly agree annually to furnish Beneficiary upon request validated receiptsor copies of checks evidencing payment of all taxes assessed against, and insurancecovering, the said Property. If Grantors should fail to furnish such receipts,Beneficiary may require Grantors to deposit monthly with Beneficiary on thepayment dates specified in the Note hereby secured in addition to the monthlypayment of principal and interest provided in the Note hereby secured a sumequal to 1/12 of the estimated annual taxes and insurance premiums coveringsuch Property, such estimates to be made by Beneficiary. Beneficiary shall holdsuch deposits, without bond and without accrual of interest thereon, to paytaxes and insurance premiums as they become due, until the indebtedness securedhereby is fully paid and the balance delivered to Grantors.

 

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**Allagreements between any of the parties hereto are hereby limited by theseprovisions which shall override all such agreements, whether now existing orthereafter arising. If from a construction of any document related to anytransaction between Bank, Grantors and/or any other person or entity executingthis Deed Of Trust, any term(s) or provision(s) of any document is in conflictwith applicable law, such document shall be automatically reformed and modifiedas to comply with applicable law, without the necessity of execution of anyamendment or new document.**

 

That in theevent of default in the payment of any installment, principal or interest, orof a late charge, of the Note hereby secured, or ** in the payment, when due,of any other indebtedness secured hereby, in accordance with the terms thereof,or of a breach of any of the covenants herein contained to be performed byGrantors then and in any of such events Beneficiary shall, at Beneficiary’soption, accelerate the maturity of the Note(s) hereby secured and the entireoutstanding and unpaid principal indebtedness hereby secured together with allaccrued and unpaid interest thereon, all accrued and unpaid late charges, feesand other sums shall thereby become immediately due and payable, and in theevent of default in the payment of said indebtedness when due or declared due,it shall thereupon, or at any time thereafter, be the duty of the Trustee, orhis successor or substitute as hereinafter provided, at the request ofBeneficiary (which request is hereby conclusively presumed), to enforce thistrust; and after advertising the time, place and terms of the sale of the abovedescribed and conveyed Property, then subject to the lien hereof, for at leasttwenty-one (21) days preceding the date of sale by posting written or printednotice thereof at the County Courthouse and by filing a copy of such notice inthe office of the County Clerk of the county where said Property is situated,which notice may be posted by the Trustee acting, or by any person acting forhim, and the Beneficiary (the holder of the indebtedness secured hereby) has,at least twenty-one (21) days preceding the date of sale, served written orprinted notice of the proposed sale by certified mail on each person and/orentity(s) obligated to pay the indebtedness secured by this Deed Of Trustaccording to the records of Beneficiary by the deposit of such notice, enclosedin a postpaid wrapper, properly addressed to such person(s) and/or entity(s) atsuch person’s and/or entity(s) most recent address as shown by the records ofBeneficiary, in a post office or official depository under the care and custodyof the United States Postal Service, the Trustee shall sell the above describedproperty, then subject to the lien hereof, at public auction in accordance withsuch notice at the Courthouse of said county where such Property is situated(provided where said Property is situated in more than one county, the noticeto be posted as herein provided shall be posted at the Courthouse of each ofsuch counties, and filed with the County Clerk of each of such counties wheresaid Property is situated, and said above described and conveyed Property maybe sold at the Courthouse of anyone of such counties, and the notices so postedand filed shall designate the county where the Property will be sold), on thefirst Tuesday in any month between the hours of ten 0’ clock A.M. and four o’clockP.M., to the highest bidder for cash, selling all of the Property as anentirety or in such parcels as the Trustee acting may elect and make dueconveyance to the Purchaser or Purchasers, with general warranty bindingGrantors, their heirs and assigns; and of the money arising from such sale, theTrustee acting shall pay first, all the expenses of advertising the sale andmaking the conveyance, including a reasonable commission to himself, whichcommission shall be due and owing in addition to the attorney’s fees providedfor in said Note, and then to Beneficiary the full amount of principal,interest, attorney’s fees and late charges due and unpaid on said Note and allother indebtedness secured hereby, rendering the balance of the sales price, ifany, to Grantors, their heirs or assigns; and the recitals in the conveyance tothe Purchaser or Purchasers shall be full and conclusive evidence of the truthof the matters therein stated, and all prerequisites to said sale shall bepresumed to have been performed, and such sale and conveyance shall beconclusive against Grantors, their heirs and assigns.

 

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** which isnot cured within any applicable cure period

 

Beneficiarymay remedy any default, without waiving same, or may waive any default withoutwaiving any prior or subsequent default.

 

It is agreedthat in the event a foreclosure hereunder should be commenced by the Trustee,or his substitute or successor, Beneficiary may at any time before the sale ofsaid Property, direct the said Trustee to abandon the sale, and may theninstitute suit for the collection of said Note, and for the foreclosure of thisDeed Of Trust lien; it is further agreed that if the Beneficiary shouldinstitute a suit for the collection thereof, and for a foreclosure of this DeedOf Trust lien, that he may at any time before the entry of a final judgment insaid suit dismiss same and require the Trustee, his substitute or successor, tosell the Property in accordance with the provisions of this Deed Of Trust.

 

Beneficiaryshall have the right to purchase at any sale of the Property, being the highestbidder, and to have the amount for which such Property is sold credited on thedebt secured hereby.

 

Beneficiary,in any event, is hereby authorized to appoint a substitute trustee, or asuccessor trustee, to act instead of the Trustee named herein without otherformality than the designation in writing of a substitute or successor trustee;and the authority hereby conferred

 

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shall extend to the appointment of other successor and substitutetrustees successively until the indebtedness hereby secured has been paid infull, or until said Property is sold hereunder, and each substitute andsuccessor trustee shall succeed to all the rights and powers of the originaltrustee named herein.

 

In the eventany sale is made of the above described Property, or any portion thereof, underthe terms of this Deed Of Trust, Grantors, their heirs and assigns, shallforthwith upon making of such sale surrender and deliver possession of theProperty so sold to the Purchaser at such sale, and in the event of theirfailure to do so they shall thereupon from and after the making of such sale beand continue as tenants at will of such Purchaser, and in the event of theirfailure to surrender possession of said Property upon demand, the Purchaser,his heirs or assigns, shall be entitled to institute and maintain an action forforcible detainer of said Property in the Justice of the Peace Court in theJustice Precinct in which such Property, or any part thereof, is situated.

 

Grantors agreethat any resale by Beneficiary of the Property described in this Deed Of Trustafter foreclosure may be made for a price below the fair market value (i.e. atwholesale) and that Beneficiary is not required to re-sell the Property for aprice equal to or above fair market value (i.e. retail). Grantors agree thatthe sales price obtained by Beneficiary at any such resale will not be used indetermining the fair market value of the Property for the purposes ofdetermining value under Section 51.003 of the Texas Property Code.

 

To thegreatest extent permitted by law, Grantors hereby waive all rights and remediescreated under Section 51.003 of the Texas Property Code including, withoutlimitation, the right introduce evidence of the amount of the sales price ofthe Property sold by Beneficiary following any foreclosure of the lienspursuant to the terms of this Deed Of Trust.

 

It is agreedthat the lien hereby created shall take precedence over and be a prior lien toany other lien of any character whether vendor’s, materialmen’s, or mechanic’slien hereafter created on the above described Property, and in the event theproceeds of the indebtedness secured hereby as set forth herein are used topayoff and satisfy any liens heretofore existing, on said Property, thenBeneficiary is, and shall be, subrogated to all of the rights, liens andremedies of the holders of the indebtedness so paid.

 

It is furtheragreed that if Grantors, their heirs or assigns, while the owner of thehereinabove described property, should commit an act of bankruptcy, orauthorize the filing of a voluntary petition in bankruptcy; or should an act ofbankruptcy be committed and involuntary proceedings instituted or threatened,or should the Property hereinabove described be taken over by a Receiver forGrantors, their heirs or assigns, the Note hereinabove described may, at theoption of Beneficiary, immediately become due and payable, and the actingTrustee may then proceed to sell same under the provisions of this Deed OfTrust.

 

Grantorshereby transfer and assign unto Beneficiary, to be applied on the debt securedhereby: (a) all eminent domain or condemnation award moneys which may hereafterbe awarded or paid for the condemnation of the hereinabove described Property,or any part thereof or for any portion of the premises which may be appropriatefor any public or quasi-public use, or by virtue of private sale in lieuthereof and any sums which may be awarded or become payable to Grantors fordamages caused by public works or construction on or near the Property; (b) allthe bonuses, rents, royalties, damages and delay moneys that may be due or thatmay hereafter become due and payable to the Grantors or their assigns under anyoil, gas, mining or mineral lease or leases of any kind now existing, or whichmay hereafter come into existence (including agricultural and/or huntingcontracts of every kind) covering the above-described Property or any partthereof; (c) all proceeds from the sale of crops grown on the Property, as wellas all pasturage and/or grazing or hunting fees. Grantors authorize and directpayment of such money to said Beneficiary until the debt secured hereby ispaid. Such money may, at the option of the Beneficiary, be applied on the debtwhether due or not. The Beneficiary shall not be obligated, in any manner tocollect said moneys or any part thereof, and shall be responsible only foramounts received by the Beneficiary. Nothing herein contained shall beconstrued as a waiver or prejudice to the priority of this lien or the optionshereunder in favor of said Beneficiary.

 

It is agreedthat an extension, or extensions, may be made as to the time of payment of all,or part, of the indebtedness secured hereby, and that any part of the above described Property may be released fromthis lien without altering or affecting the priority of the lien created bythis Deed Of Trust in favor of any junior encumbrance, mortgage or purchaser,or any person acquiring an interest in the Property hereby conveyed, or anypart thereof; it being the intention of the parties hereto to preserve thislien on the Property herein described and all improvements thereon; and thatmay be hereafter constructed thereon, first and superior to any liens that maybe placed thereon, or that may be fixed, given or imposed by law thereon afterthe execution of this instrument notwithstanding any such extension of the timeof payment, or the release of a portion of said Property from this lien.

 

In the eventany portion of the indebtedness hereinabove described cannot be lawfullysecured by this Deed Of Trust lien on said Property, it is agreed that thefirst payments made on said indebtedness shall be applied to the discharge ofthat portion of said indebtedness.

 

Nothingcontained herein or in the Note shall ever entitle Beneficiary, upon thearising of any contingency whatsoever, to receive or collect interest in excessof the highest rate allowed by the laws of the State of Texas or to the extentFederal Law permits a greater rate, then such greater rate, on the principalindebtedness hereby secured or on any money obligation hereunder and in noevent shall Grantors be obligated to pay interest thereon in excess of suchrate.

 

If this DeedOf Trust is executed by only one person or by a corporation, the pluralreference to Grantors shall be held to include the singular and all of thecovenants and agreements herein undertaken to be performed by and the rightsconferred upon the respective Grantors name herein, shall be binding upon andinure to the benefit of not only said parties respectively but also theirrespective heirs, executors, administrators, grantees, successors and assigns.

 

In the eventthat the hereinabove described Property is sold, conveyed, or otherwisedisposed of without the prior written consent of the Beneficiary, the maturityof the outstanding and unpaid principal, all accrued and unpaid interest, allaccrued and unpaid late charges, and other fees and/or charges arising out ofsaid Note or hereunder may, at the option of the Beneficiary, be acceleratedand the Beneficiary may immediately demand payment of the then outstanding andunpaid principal sum, together with all accrued and unpaid interest duethereon, and all accrued and unpaid late charges, and other fees and/or chargesthen due and owing.

 

In the eventGrantors should seek a temporary restraining order or an injunction or otherlegal action, be it temporary or permanent, to prevent, hinder or delay theexercise by Beneficiary of its rights and remedies under this Deed Of Trust,including, without limitation, its foreclosure rights, upon the occurrence ofas default, as herein provided, then Grantors agree to pay and/or reimburseBeneficiary for all costs and expenses, including its reasonable and necessaryattorney’s fees, incurred by Beneficiary in connection with its

 

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defense,appearance and/or other action taken by Beneficiary with respect thereto, suchpayment and/or reimbursement to be made*** Grantors agree to contact, inwriting, Dennis E. Nixon, prior to the institution of any such legal or arbitrationproceedings so as to permit Beneficiary the opportunity to appear and defenditself.

 

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*******byBeneficiary unless Beneficiary obtains a final, non-appealable judgment infavor of Beneficiary.

 

It shall be anevent of default under this Deed Of Trust should Grantors, or any of them orany guarantor, fail to timely deliver any and all financial statements, incometax returns, inventory reports, cash flow information, accounts receivablereports, or any other business, tax or financial information requested byBeneficiary.

 

Grantorshereby grant Beneficiary the right to protest any and all ad valorem taxes andspecial assessments made against the Property covered by this Deed Of Trust. Inthat regard, Grantors shall deliver to Beneficiary a true and correct copy,when received, of all tax assessments, valuations, re-appraisals and othernotices received by Grantors from all tax authorities. Beneficiary shall havethe right to appear in all tax proceedings and file appeals concerning taxesaffecting the Property or any portion thereof.

 

Grantorsexpressly represent that this Deed Of Trust and the Note hereby secured aregiven for the following purpose, to-wit:

 

TO PROVIDE A SOURCE OF WORKING CAPITAL FOR GRANTORS.

 

To the extentallowed by law, this conveyance is also made in trust to secure and enforce thepayment of any and all other indebtedness of Grantors to Beneficiary presentlyexisting or which may in any manner or means hereafter be incurred or createdby Grantors, which other or future indebtedness Grantors acknowledge to becurrently contemplated by Grantors and evidenced in any manner whatsoever,including without limitation:

 

A.                                   any commercial loanor indebtedness;

B.                                     any credit card orother consumer type of loan;

C.                                     any indebtednessrelating to checking or savings accounts (overdrafts, fees, etc.);

D.                                    any expensesincurred in the protection or maintenance of the collateral securing any ofsuch liabilities, loans, and obligations;

E.                                      any expensesincurred in the collection of any indebtedness and/or obligation of theGrantors to Lender whether arising out of this agreement or otherwise;

F.                                      any letters ofcredit and/or indebtedness arising out of, or advanced to pay, letters ofcredit transactions;

G.                                     any indebtedness,however evidenced, whether by promissory note, bookkeeping entry, electronictransfer or by any other manner or form;

H.                                    any otherindebtedness of Grantors to any financial institution affiliated withInternational Bancshares Corporation, jointly and/or severally, and in anycapacity, whether as maker, guarantor, or otherwise, now or hereafter owing andregardless of how evidenced or arising; and

I.                                         any and allextensions, modifications, substitutions and/or renewals of any of suchindebtedness.

 

To the extentallowed by law, for purposes hereof it is intended that the indebtednessinclude all classes of indebtedness, whether evidenced by notes, open accounts,overdraft, or otherwise, and whether direct, indirect or contingent, regardlessof class, form or purpose and including but not limited to, loans for consumer,agricultural, business or personal purposes. The indebtedness does not includeamounts owing pursuant to a homestead loan, homestead equity loan and/or homeequity line of credit.

 

It beingexpressly agreed and understood that any and all sums now owed to or hereafteradvanced by Beneficiary to Grantors shall be payable at the main offices ofBeneficiary at 130 E. Travis, San Antonio, Bexar County, Texas 78205, and shallbear interest as may be provided in such notes or other evidences ofindebtedness given by Grantors to Beneficiary; and this instrument is alsoexecuted for the purpose of securing and enforcing the payment of any renewal,extension and/or modification of any note or of any part of the saidindebtedness of Grantors and including any further loans and advancements madeby Beneficiary to Grantors. Repayment of all indebtedness of Grantors toBeneficiary shall not terminate this Deed Of Trust unless the same be soreleased by Beneficiary at the request of Grantors, but otherwise it shallremain in full force and effect to secure all future advances and indebtedness,regardless of any additional security that may be taken as to any past orfuture indebtedness, and shall be unaffected by any renewals, extensions or partialreleases hereunder.

 

GRANTORS WILLNEITHER CREATE NOR PERMIT ANY JUNIOR OR SUBSEQUENT LIEN OR ENCUMBRANCE AGAINSTTHE PROPERTY WITHOUT PRIOR WRITTEN CONSENT OF BENEFICIARY.

 

Applicable toPrior Liens. If this Deed Of Trust is or becomessubordinate to any other liens, security interests, assignments of leases orrents or any other encumbrances (collectively, the “Prior Liens”) affecting anyof the Property, all documents creating the Prior Liens and evidencing andgoverning the indebtedness secured shall be collectively called the “Prior LienDocuments” and this section shall

 

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apply.Grantors shall not enter into any renewal, extension, modification, increase orrefinancing of any of the Prior Lien Documents or the indebtedness securedthereby without prior written consent of Beneficiary. Grantors shall pay whendue all indebtedness evidenced and secured by the Prior Lien Documents andshall timely perform all other obligations of the Grantors under the Prior LienDocuments. Beneficiary may, but shall not be obligated to, pay any suchindebtedness or perform any such obligations for the account of Grantors andany sum so expended shall be secured hereby. Grantors shall pay to Beneficiaryall amounts so expended by Beneficiary with interest on such amounts from thedate and at the rate set forth in the Note, but not in excess of the highestrate permitted by applicable law. Beneficiary’s cure of any default under anyof the Prior Lien Documents shall not constitute a cure of the default underthis Deed Of Trust. Grantors shall send to Beneficiary a copy of each notice ofdefault or notice of acceleration or other notice received by Grantors from theholder of any of the Prior Lien Documents within one (I) business day afterreceipt thereof by Grantors. Notwithstanding the foregoing, Beneficiary doesnot consent to any Prior Lien unless otherwise expressly permitted in this DeedOf Trust.

 

SecurityAgreement/Financing Statement. This Deed Of Trust lienshall cover all property now or hereafter affixed or attached or incorporatedinto the Property, described herein and now or hereafter owned by Grantors inwhich Grantors now or hereafter have an interest which, to the fullest extentpermitted by law, shall be deemed fixtures and part of the Property. Inaddition, this Deed Of Trust lien shall cover, and Grantors to the extent ofany present or hereafter created rights of Grantors in such Property herebygrant to Beneficiary, a security interest in (i) all building materials,fixtures, equipment and other personal property, to be incorporated into anyimprovements constructed on the premises; (ii) all goods, materials, supplies,fixtures, equipment, machinery, furniture and furnishings and other personalproperty which are now or may hereafter be appropriated for use on (whethersuch items are stored on the premises or elsewhere), located on or used inconnection with the premises; (iii) all rents, issues and profits, proceeds,profits, renewals, income or other benefit derived from the payments receivedfor lodging from interests and/or materials, and all inventory, accounts,accounts receivable, contract rights, general intangibles, intellectualproperty, chattel paper, instruments, documents, permits, plans, specifications,drawings, governmental approvals, notes, drafts, letters of credit,indebtedness arising from and/or to pay an advance on letters of credit,accounts due from credit, debit and/or charge card companies, insurancepolicies, insurance condemnation awards and proceeds, trade names, trademarksand service marks arising from or related to the premises and any businessconducted on the premises by Grantors; and (iv) all replacements andsubstitutions for or additions to, all products and proceeds of, and all books,records and files relating to any of the foregoing. To the extent any propertycovered by this Deed Of Trust lien consists of rights in action or personalproperty covered by the Texas Business And Commerce Code, this Deed Of Trustlien constitutes a security agreement and is intended to create a securityinterest in such property in favor of Beneficiary. This Deed Of Trust shall beself-operative with respect to such property, and in the event of defaultand/or acceleration of the indebtedness hereby secured, Grantors expresslygrant to Beneficiary the right to enter upon the Property where the collateralis located for the purpose of enforcing its right to such collateral, andGrantors agree to execute and deliver, on demand, such security agreements,financing statements and other instruments as Beneficiary may request in orderto impose the lien hereof made more specifically upon any of such property. Ifthe lien of this Deed Of Trust on any property shall be subject to priorsecurity agreement covering such property, then in the event of any defaulthereunder, all the rights, title and interest of Grantors in and to any and alldeposits made in connection with the transaction whereby such prior securityagreement was made are hereby presently assigned to Beneficiary, together withthe benefit of any payments now or hereafter made in connection with suchtransaction.

 

FinancingStatements. In addition to Beneficiary’s other rightsset forth in this Deed Of Trust, Beneficiary shall have all rights of a securedparty under the Texas Business And Commerce Code (the “Code”). At Beneficiary’srequest, Grantors shall execute and deliver to Beneficiary all financingstatements that may be required by Beneficiary to establish and maintain thevalidity and priority of Beneficiary’s security interest, and Grantors shallbear all costs thereof, including all searches reasonably required byBeneficiary. If Beneficiary should dispose of any of the property covered bythe security interest created under this Deed Of Trust pursuant to the Code,ten (10) days written notice by Beneficiary to Grantors shall be deemed to bereasonable notice; provided however, Beneficiary may dispose of such propertyin accordance with the foreclosure procedures of this Deed Of Trust in lieu ofproceeding under the Code.

 

(i)                            Grantorshereby authorize Beneficiary to file a Financing Statement, an AmendedFinancing Statement and a Continuation Financing Statement (collectivelyreferred to as the “Financing Statement”) describing the Collateral.

 

(ii)                           Grantorshereby authorize Beneficiary to file a Financing Statement describing anyagricultural liens or other statutory liens held by Beneficiary.

 

(iii)                          Grantorsshall receive prior to the Closing an official report from the Secretary ofState of each Collateral State, the Chief Executive Office State, and theDebtor State (each as defined below) (the “SOS Reports”) indicating thatBeneficiary’s security interest is prior to all other security interests orother interests reflected in the report.

 

(iv)                          Beneficiaryshall receive at any time following the Closing an SOS Report indicating thatBeneficiary’s security interest is prior to all other security interests orother interests reflected in the report.

 

Beneficiarymay sell, lease, or otherwise dispose of any of the personal property in accordwith the rights, remedies, and duties of a Beneficiary under Chapters 2 and 9of the Texas Business And Commerce Code after giving notice as required bythose chapters; unless the Collateral threatens to decline rapidly in value, isperishable, or would typically be sold on a recognized market, Beneficiary willgive Grantors reasonable notice of any public sale of the Collateral or of atime after which it may be otherwise disposed of without further notice toGrantors; in this event, notice will be deemed reasonable if it is mailed,postage prepaid, to Grantors at the address specified in this agreement atleast ten days before any public sale or ten days before the time when theCollateral may be otherwise disposed of without further notice to Grantors.Grantors authorize Beneficiary to disclaim or modify any and all warranties setforth in Section 9.610(d) of the Texas Business And Commerce Code andstipulate and agree that such a disclaimer and/or modification will not renderthe sale commercially unreasonable. Beneficiary may retain all or part of theCollateral in full and/or partial satisfaction of the Indebtedness pursuant to Section 9.620of Texas Business And Commerce Code.

 

Without providing Beneficiary with at least thirty (30) days priorwritten notice of Grantors’ intention to do so, Grantors, until theindebtedness is paid in full, agree that they will not:

 

a                                          in onetransaction or a series of related transactions, merge into or consolidate withany other entity, sell all or substantially all of its assets, or in any wayjeopardize its corporate existence,

b                                         change thestate of its incorporation,

c                                          change itscorporate name,

 

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d.                                      change theaddress and/or location of its Chief Executive Office

e.                                       file a UCC-IAmendment form, and/or

f.                                         file a UCC-ITermination form.

 

Grantors shallgive advance notice in writing to Beneficiary of any proposed change inGrantors’ name, identity, or structure and shall execute and deliver toBeneficiary, prior to or concurrently with the occurrence of any such change,all additional financing statements that Beneficiary may require to establishand maintain the validity and priority of Beneficiary’s security interest withrespect to any of the property described or referred to herein.

 

Grantorsexpressly represent that the Property hereinabove mentioned and conveyed to theTrustee forms no part of any property owned, used or claimed by Grantors asexempted from forced sale under the law of the State of Texas as eitherpersonal or business homestead, and Grantors renounce all and every Claimthereto under any such law or laws and hereby expressly designate as theirhomestead, personal and business, and as constituting all the property owned,used or claimed by them as exempt either as personal and/or business under suchlaws the following described property:

 
|                              | County,  Texas. |
|-----------------------------------|-----------------|
| (Personal And Business Homestead) |            |

 

Assignments ofRents, Profits, etc. All of the rents, royalties,bonuses, issues, contracts for deed, proceeds, profits, revenue, income and anyother benefit derived from the Property and improvements thereto, or arisingfrom the use or enjoyment of any portion thereof or from any lease or agreementpertaining thereto and liquidated damages following default under such leases,and all proceeds payable under any policy of insurance covering loss of rentsor caused by damage to any part of the Property, together with any and allrights that Grantors may have against any tenant with any and all rights thatGrantors may have against any tenant under such leases or any subtenants oroccupants of any part of the Property (hereinafter called the “Rents”), arehereby absolutely and unconditionally assigned to Beneficiary. Prior to adefault in payment by Grantors of any portion of the indebtedness secured bythis Deed Of Trust (the “Indebtedness”) or breach of any covenant,representation or warranty made herein by Grantors (collectively, an “Event of Default”),Grantors shall have a license to collect and receive all Rents as Trustee forthe benefit of Beneficiary and Grantors, and Grantors shall apply the funds socollected first to the payment of the Indebtedness in such manner asBeneficiary elects and thereafter to the account of Grantors. The foregoingassignment is intended to be absolute, unconditional and presently effective.It shall never be necessary for Beneficiary to institute legal proceedings ofany kind to enforce the terms of this assignment.

 

Assignment ofLeases. Grantors hereby assign to Beneficiary allexisting and future leases, including subleases thereof, and any and allextensions, renewals, modifications, and replacements thereof, upon any part ofthe Property (the “Leases”). Grantors hereby further assign to Beneficiary allguaranties of tenants’ performance under the Leases. Prior to an Event ofDefault, Grantors shall have the right, without joinder of Beneficiary, toenforce the Leases, unless Beneficiary directs otherwise.

 

Warranties ConcerningLeases and Rents. Grantors represent and warrant that:(a) Grantors have good title to the Leases and Rents hereby assigned andauthority to assign them, and no other person or entity has any right, title orinterest therein; (b) all existing Leases are valid, unmodified and in fullforce and effect, except as indicated herein, and no default exists thereunder;(c) unless otherwise provided herein, no Rents have been or will be assigned,mortgaged or pledged; (d) no Rents have been or will be anticipated, waived,released, discounted, set-off or compromised; and (e) Grantors have notreceived any funds or deposits from any tenant for which credit has not alreadybeen made on account of accrued Rents.

 

Grantor’sCovenants of Performance as to Leases. Grantorscovenant to: (a) perform all of their obligations under the Leases and giveprompt notice to Beneficiary of any failure to do so; (b) give immediate noticeto Beneficiary of any notice Grantors received from any tenant or subtenantunder any leases, specifying any claimed default by any party under suchLeases, excluding, however, notice of defaults under residential leases; (c)enforce the tenant’s obligations under the Leases; (d) defend, at Grantor’sexpense, any proceeding pertaining to the Leases, including, if Beneficiary sorequests, any such proceeding to which Beneficiary is a party; and (e) neithercreate nor permit any encumbrance upon its interest as lessor of the Leases,except this Deed Of Trust and any other encumbrances permitted by this Deed OfTrust.

 

Prior Approvalfor Action Affecting Leases. Grantors shall not,without the prior written consent of Beneficiary, receive or collect Rents morethan one month in advance, encumber or assign future Rents, waive or releaseany obligations of any tenant under the Leases, cancel, terminate or modify anyof the Leases, cause or permit any cancellation, termination or surrender ofany of the Leases, or commence any proceedings for dispossession of any tenantunder any of the Leases, except upon default by the tenant thereunder, orpermit any assignment of the Leases whereby a tenant is released from itsobligation.

 

Rejection ofLeases in Bankruptcy. Grantors agree that nosettlement for damages for termination of any of the Leases under the FederalBankruptcy Code, or under any other federal, state, or local statute, shall bemade without the prior written consent of Beneficiary, and any check in paymentof such damages shall be made payable to both Grantors and Beneficiary.Grantors hereby assign any such payment to Beneficiary, to be applied to theIndebtedness as Beneficiary may elect, and agree to endorse any check for suchpayment to the order of Beneficiary.

 

Beneficiary’sRights. Beneficiary’s acceptance of this assignmentshall not, prior to, upon, or after entry upon and taking possession of theProperty by Beneficiary or any foreclosure of the lien hereunder or conveyanceof the Property herein described in lieu thereof, be deemed to constituteBeneficiary as a “mortgagee in possession”, nor obligate Beneficiary to appearin or defend any proceeding relating to any of the Leases or to the Property,take any action hereunder, expend any money, incur any expenses or perform anyobligation or liability under the Leases, or assume any obligation or liabilityunder the Leases, or assume any obligation including security deposits.Beneficiary shall not be liable for any injury or damage to any person orproperty in or about the Property. Beneficiary shall not be obligated toperform, satisfy, or otherwise adhere to any terms of any of the Leases or anycovenant of Grantors to any tenant unless Beneficiary agrees to do so, inwriting, executed by Beneficiary, which Beneficiary may elect not to do so, inits sole and absolute discretion.

 

Appointment ofAttorney-In-Fact. Grantors hereby appoint Beneficiaryits attorney-in-fact, coupled with an interest, empowering Beneficiary tosubordinate any Leases to this Deed Of Trust.

 

**Indemnification.Grantors hereby indemnify and hold Beneficiary harmless from all liability,damage, or expense incurred by**

 

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**Beneficiaryfrom any claims under the Leases, including, without limitation, claims bytenants for security deposits or for rental payments more than one (1) month inadvance and not delivered to Beneficiary. All amounts indemnified hereunder,including reasonable attorney’s fees, if paid by Beneficiary shall bearinterest at the maximum lawful rate and shall be payable by Grantorsimmediately without demand and shall be secured hereby.**

** **

Records. Etc.Upon request by Beneficiary, Grantors shall deliver to Beneficiary executedoriginals of all Leases and copies of all records relating thereto. There shallbe no merger of the leasehold estates, created by the Leases, with the feeestate of the Mortgaged Property without the prior written consent ofBeneficiary. Upon default, Grantors hereby authorize and direct the tenantsunder the Leases to pay Rents to Beneficiary upon written demand byBeneficiary, without further consent of Grantors, and the tenants may rely uponany written statement delivered by Beneficiary to the tenants. Any such paymentto Beneficiary shall constitute payment to Grantors under the Leases.

 

Fixtures.Some of the items on the Property are goods that are or are to become fixturesrelated to said Property, and it is intended that, as to those goods, this DeedOf Trust shall be effective as a financing statement filed as a fixture filingfrom the date of its filing of record in the real estate records of the countyin which the Property is situated. Information concerning the security interestcreated by this instrument may be obtained from Beneficiary, as secured party,at the address of Beneficiary set forth elsewhere in this Deed Of Trust. Themailing address of the Grantors, as Debtor, is as stated herein.

 

EnvironmentalCompliance. Grantors’ use of the Property will at alltimes comply with all laws, statutes, ordinances, rules and regulations (“Laws”)of any governmental, quasi-governmental or regulatory authority which relate tothe transportation, storage, placement, handling, treatment, discharge,generation, production, removal or disposal (collectively, “Treatment”) of anywaste, petroleum product (including, without limitation, gasoline and dieselfuel), waste products, poly-chlorinated biphenyl, asbestos hazardous materials,and/or any other substance, the Treatment of which is regulated by any laws(collectively, “Waste”). Grantors will comply with all Laws regardingunderground storage tanks used to hold gasoline, diesel fuel, or any otherpetroleum products on the Property.

 

To the best ofGrantors’ knowledge, no Waste is located on the Property, and neither Grantorsnor, to the best of Grantors’ knowledge, any other person has ever caused orpermitted any Treatment of any Waste on, under or at the Property or any partthereof, and to the best of Grantors’ knowledge, no property adjoining theProperty is being used, or has ever been used at any previous time for theTreatment of Waste.

 

To the best ofGrantors’ knowledge, no investigation, administrative order, consent order andagreement, litigation or settlement, with respect to Waste or the Treatment ofWaste is proposed, threatened, anticipated or in existence with respect to theProperty. The Property is not currently on, and to Grantors’ knowledge, afterdiligent investigation and inquiry, has never been on, any federal or state “Superfund”or “Superlien” list.

 

Grantors agreeto (a) give notice to Beneficiary immediately upon Grantors acquiring knowledgeof any Waste on the Property with a full description thereof; (b) promptlycomply with any laws applicable to Grantors or the Property requiring theremoval, treatment or disposal of such Waste and provide Beneficiary with satisfactoryevidence with such compliance; and (c) provide Beneficiary within thirty (30)days after demand by Beneficiary with a bond, letter of credit or similarfinancial assurance evidencing to Beneficiary’s satisfaction that the necessaryfunds are available to pay the cost of removing, treating and disposing of suchWaste and discharging of any assessments that may be established on theProperty as a result thereof.

 

Anyenvironmental spill, discharge or other event upon or adjacent to the Propertywhich Beneficiary determines materially and adversely affects the value and/oruse of the Property, shall be an Event of Default under this Deed Of Trust andthe Note and all other indebtedness secured hereby.

 

Grantors agreeto perform an asbestos survey and obtain a permit, and to provide a copy ofsaid survey to Beneficiary, prior to commencing any renovation and/ordemolition of a public or commercial building. Grantors further agree to complywith all other state and federal statutes and/or regulations regarding asbestosand asbestos removal.

 

SiteAssessments. Beneficiary (by its officers, employeesand agents) at any time and from time to time, either prior to or after theoccurrence of any default, may contract for the services of any person or firm(“Site Reviewers”) to perform environmental site assessments (“Site Assessments”)on the Property for the purposes of determining whether there exists on theProperty any environmental condition which could reasonably be expected toresult in any liability, cost or expense to the owner, occupier or operator ofsuch Property arising under any Laws relating to Waste or the Treatment ofWaste. The Site Assessments may be performed at any time or times, uponreasonable notice, and under reasonable conditions established by Grantorswhich do not impede the performance of the Site Assessments. Grantors agreethat any Site Assessment shall be for the sole and exclusive use, benefit andreliance of Beneficiary in assessing the value of its security interest in theProperty and will not be relied on by Grantors for any purpose. The SiteReviewers are hereby authorized to enter upon the Property for such purposes.The Site Reviewers are further authorized to perform above and below groundtesting for environmental damage or the presence of waste on the Property andsuch other tests on the Property as may be necessary to conduct the SiteAssessments in the reasonable opinion of the Site Reviewers. Grantors willsupply to the Site Reviewers such historical and operational informationregarding the Property as may be reasonably requested by the Site Reviewers tofacilitate the Site Assessments and will be available for meetings with SiteReviewers if requested.

 

**Indemnification.Whether or not any Site Assessments are conducted, and regardless of whether ornot a default occurs under this Deed Of Trust or under the Note or under anyother indebtedness secured hereby and regardless of whether any remedies inrespect of the Property are exercised by Beneficiary, Grantors will defend,indemnify and hold harmless Beneficiary and Trustee from any and allliabilities (including strict liability), actions, demands, penalties, losses,costs or expenses (including, without limitation, attorneys fees and expenses,and remedial costs), suit costs of any settlement or judgment and claims of anyand every kind whatsoever which may now or in the future (whether before orafter the release or foreclosure of this Deed Of Trust) be paid, incurred orsuffered by or asserted against Beneficiary or Trustee by any person or entityor governmental agency for, with respect to, or as a direct or indirect resultof, the presence on or under, or the escape, seepage, leakage, spillage,discharge, emission or release from, on or affecting the Property of any wasteor any spill, or which arise out of or result from the environmental conditionof the Property or the applicability of any laws relating to the waste(including, without limitation, the Comprehensive Environmental Response,Compensation, and Liability Act, 42 V.S.C. 9601 et seq., as arises from time to**

 

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**time, or anyfederal, state or local so-called “Superfund” or “Superlien” law, statute, law,ordinance, code, rule, regulation, order or decree), regardless of whether ornot caused by or within the control of Grantors, Beneficiary or Trustee. Therepresentations, covenants, warranties an indemnification herein containedshall survive the release and/or judicially or non-judicial foreclosure (ortransfer in lieu thereof) of the lien of this Deed Of Trust. For the purpose ofthis paragraph and notwithstanding any other provision contained herein to thecontrary, the term “Grantors” shall refer not only to the Grantors not only tothe Grantors named herein, but also to all other person who may hereafterassume to the Note and the obligations of this**

**Deed OfTrust.**

 

**ARBITRATION.**

 

**GRANTORS,BENEFICIARY AND TRUSTEE FURTHER AGREE AS FOLLOWS:**

 

**I.****                                         CONSUMER-RELATEDCLAIMS OF $75,000.00 OR LESS IN ACTUAL DAMAGES:**

 

**(a)****                                  WITHREGARD TO ALL CONSUMER-RELATED CLAIMS OF $75,000.00 OR LESS IN ACTUAL DAMAGES, ANYAND ALL CONTROVERSIES OR CLAIMS ARISING OUT OF THIS CONTRACT, ITS NEGOTIATIONAND/OR THE BREACH THEREOF, SHALL BE SETTLED BY ARBITRATION ADMINISTERED BY THEAMERICAN ARBITRATION ASSOCIATION UNDER ITS SUPPLEMENTAL PROCEDURES FORRESOLUTION OF CONSUMER-RELATED DISPUTES AND CONSUMER DUE PROCESS PROTOCOL(WHICH ARE INCORPORATED HEREIN FOR ALL PURPOSES), AND JUDGMENT ON THE AWARDRENDERED BY THE ARBITRATOR(S) MAY BE ENTERED IN ANY COURT HAVING JURISDICTIONTHEREOF. IT IS INTENDED BY ALL PARTIES THAT THIS ARBITRATION CLAUSE MEET ANDINCLUDE ALL FAIRNESS STANDARDS AND PRINCIPLES OF THE AMERICAN ARBITRATIONASSOCIATION’S CONSUMER DUE PROCESS PROTOCOL AND DUE PROCESS IN PREDISPUTEARBITRATION.**

 

**(b)****                                  INSTEADOF PROCEEDING IN ARBITRATION, ANY PARTY HERETO MAY PURSUE ITS CLAIM IN THECONSUMER’S LOCAL SMALL CLAIMS COURT, IF THE CONSUMER-RELATED CLAIM MEETS THESMALL CLAIMS COURT JURISDICTIONAL LIMITS. IF THE SMALL CLAIMS COURT OPTION ISCHOSEN, THE PARTY MUST CONTACT THE SMALL CLAIMS COURT DIRECTLY.**

 

**(c)****                                  THEPARTIES FURTHER AGREE THAT (i) NO ARBITRATION PROCEEDING HEREUNDER SHALL BECERTIFIED AS A CLASS ACTION OR PROCEED AS A CLASS ACTION, OR ON A BASISINVOLVING CLAIMS BROUGHT IN A PURPORTED REPRESENTATIVE CAPACITY ON BEHALF OFTHE GENERAL PUBLIC, OTHER CUSTOMERS OR POTENTIAL CUSTOMERS OR PERSONS SIMILARLYSITUATED AND (ii) NO ARBITRATION PROCEEDING HEREUNDER SHALL BE CONSOLIDATEDWITH, OR JOINED IN ANY WAY WITH, ANY OTHER ARBITRATION PROCEEDING ‘**

 

**(d)****                                  THISARBITRATION PROVISION SHALL SURVIVE ANY TERMINATION, AMENDMENT, OR EXPIRATION OFTHE AGREEMENT IN WHICH THIS PROVISION IS CONTAINED, UNLESS ALL OF THE PARTIESOTHERWISE EXPRESSLY AGREE IN WRITING**

 

**(e)****                                  THEPARTIES ACKNOWLEDGE THAT THIS AGREEMENT EVIDENCES A TRANSACTION INVOLVINGINTERSTATE COMMERCE. THE FEDERAL ARBITRATION ACT SHALL GOVERN THEINTERPRETATION, ENFORCEMENT, AND PROCEEDINGS PURSUANT TO THE ARBITRATION CLAUSEOF THIS AGREEMENT.**

 

**II.****                                     CONSUMER-RELATEDCLAIMS ABOVE $75,000.00 IN ACTUAL DAMAGES AND/OR COMMERCIAL**

**CLAIMS:**

 

**(a)****                                  ANYARBITRATION INVOLVING CONSUMER-RELATED CLAIMS ABOVE $75,000.00 IN ACTUALDAMAGES AND/OR COMMERCIAL CLAIMS HEREUNDER SHALL BE BEFORE AT LEAST THREENEUTRAL ARBITRATORS ASSOCIATED WITH THE AMERICAN ARBITRATION ASSOCIATION ANDSELECTED IN ACCORDANCE WITH THE COMMERCIAL ARBITRATION RULES OF THE AMERICANARBITRATION ASSOCIATION. FAILURE OF ANY ARBITRATOR TO DISCLOSE ALL FACTS WHICHMIGHT TO AN OBJECTIVE OBSERVER CREATE A REASONABLE IMPRESSION OF THE ARBITRATOR’SPARTIALITY, AND/OR MATERIAL ERRORS OF LAW SHALL BE GROUNDS [IN ADDITION TO ALLOTHERS] FOR VACATUR OF AN AWARD RENDERED PURSUANT TO THIS AGREEMENT.**

 

**(b)****                                  THEPARTIES FURTHER AGREE THAT (i) NO ARBITRATION PROCEEDING HEREUNDER SHALL BECERTIFIED AS A CLASS ACTION OR PROCEED AS A CLASS ACTION, OR ON A BASISINVOLVING CLAIMS BROUGHT IN A PURPORTED REPRESENTATIVE CAPACITY ON BEHALF OFTHE GENERAL PUBLIC, OTHER CUSTOMERS OR POTENTIAL CUSTOMERS OR PERSONS SIMILARLYSITUATED AND (ii) NO ARBITRATION PROCEEDING HEREUNDER SHALL BE CONSOLIDATEDWITH, OR JOINED IN ANY WAY WITH, ANY OTHER ARBITRATION PROCEEDING**

 

**(c)****                                  THISARBITRATION PROVISION SHALL SURVIVE ANY TERMINATION, AMENDMENT, OR EXPIRATION OFTHE AGREEMENT IN WHICH THIS PROVISION IS CONTAINED, UNLESS ALL OF THE PARTIESOTHERWISE EXPRESSLY AGREE IN WRITING**

 

**(d)****                                  THEPARTIES ACKNOWLEDGE THAT THIS AGREEMENT EVIDENCES A TRANSACTION INVOLVINGINTERSTATE COMMERCE. THE FEDERAL ARBITRATION ACT SHALL GOVERN THEINTERPRETATION, ENFORCEMENT, AND PROCEEDINGS PURSUANT TO THE ARBITRATION CLAUSEOF THIS AGREEMENT.**

 

**III.****                                 ADDITIONALCOMMERCIAL CLAIMS PROVISIONS:**

 

**(a)****                                  ANYAND ALL COMMERCIAL CONTROVERSIES BETWEEN THE PARTIES, SHALL BE RESOLVED BYARBITRATION IN ACCORDANCE WITH THE COMMERCIAL ARBITRATION RULES OF THE AMERICANARBITRATION ASSOCIATION IN EFFECT AT THE TIME OF FILING, UNLESS THE COMMERCIALARBITRATION RULES CONFLICT WITH THIS PROVISION, AND IN SUCH EVENT THE TERMS OFTHIS PROVISION SHALL CONTROL TO THE EXTENT OF THE CONFLICT**

 

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**(b)****                                  THEAWARD OF THE ARBITRATORS, OR A MAJORITY OF THEM SHALL BE FINAL, AND JUDGMENTUPON THE AWARD RENDERED MAY BE ENTERED IN ANY COURT, STATE OR FEDERAL, HAVINGJURISDICTION. THE ARBITRATION AWARD SHALL BE IN WRITING AND SPECIFY THE FACTUALAND LEGAL BASIS FOR THE AWARD. UPON THE REQUEST OF ANY PARTY, THE AWARD SHALLINCLUDE FINDINGS OF FACT AND CONCLUSIONS OF LAW.**

 

**(c)****                                  ARBITRABLEDISPUTES INCLUDE ANY AND ALL CONTROVERSIES OR CLAIMS BETWEEN THE PARTIES OFWHATEVER TYPE OR MANNER, INCLUDING WITHOUT LIMITATION, ANY CLAIM ARISING OUT OFOR RELATING TO THIS DEED OF TRUST, ALL PAST, PRESENT AND/OR FUTURE CREDITFACILITIES AND/OR AGREEMENTS INVOLVING THE PARTIES, ANY TRANSACTIONS BETWEEN ORINVOLVING THE PARTIES, AND/OR ANY ASPECT OF ANY PAST OR PRESENT RELATIONSHIP OFTHE PARTIES, WHETHER BANKING OR OTHERWISE, SPECIFICALLY INCLUDING ANY ALLEGEDTORT COMMITTED BY ANY PARTY.**

 

**(d)****                                  THEPARTIES SHALL ALLOW AND PARTICIPATE IN DISCOVERY IN ACCORDANCE WITH THE FEDERALRULES OF CIVIL PROCEDURE FOR A PERIOD OF ONE HUNDRED TWENTY (120) DAYS AFTERTHE FILING OF THE ORIGINAL RESPONSIVE PLEADING DISCOVERY MAY CONTINUETHEREAFTER AS AGREED BY THE PARTIES OR AS ALLOWED BY THE ARBITRATORS.UNRESOLVED DISCOVERY DISPUTES SHALL BE BROUGHT TO THE ATTENTION OF THEARBITRATORS BY WRITTEN MOTION FOR PROPER DISPOSITION, INCLUDING RULING ON ANYASSERTED OBJECTIONS, PRIVILEGES, AND PROTECTIVE ORDER REQUESTS AND AWARDING REASONABLEATTORNEY’S FEES TO THE PREVAILING PARTY.**

 

**(e)****                                  INTHE EVENT THE AGGREGATE OF ALL AFFIRMATIVE CLAIMS ASSERTED EXCEED $500,000.00,EXCLUSIVE OF INTEREST AND ATTORNEY’S FEES, OR UPON THE WRITTEN REQUEST OF ANYPARTY, (1) PRIOR TO THE DISSEMINATION OF A LIST OF POTENTIAL ARBITRATORS, THEAMERICAN ARBITRATION ASSOCIATION SHALL CONDUCT AN IN PERSON ADMINISTRATIVECONFERENCE WITH THE PARTIES AND THEIR ATTORNEYS FOR THE FOLLOWING PURPOSES ANDFOR SUCH ADDITIONAL PURPOSES AS THE PARTIES OR THE AMERICAN ARBITRATIONASSOCIATION MAY DEEM APPROPRIATE, (A) TO OBTAIN ADDITIONAL INFORMATION ABOUTTHE NATURE AND MAGNITUDE OF THE DISPUTE AND THE ANTICIPATED LENGTH OF HEARINGSAND SCHEDULING; (B) TO DISCUSS THE VIEW OF THE PARTIES ABOUT ANY TECHNICALAND/OR OTHER SPECIAL QUALIFICATIONS OF THE ARBITRATORS; AND (C) TO CONSIDER,WHETHER MEDIATION OR OTHER METHODS OF DISPUTE RESOLUTION MIGHT BE APPROPRIATE,AND (2) AS PROMPTLY AS PRACTICABLE AFTER THE SELECTION OF THE ARBITRATORS, APRELIMINARY HEARING SHALL BE HELD AMONG THE PARTIES, THEIR ATTORNEYS AND THEARBITRATORS. WITH THE AGREEMENT OF THE ARBITRATORS AND THE PARTIES, THE PRELIMINARYHEARING MAY BE CONDUCTED BY TELEPHONE CONFERENCE CALL RATHER THAN IN PERSON. ATTHE PRELIMINARY HEARING THE MATTERS THAT MAY BE CONSIDERED SHALL INCLUDE,WITHOUT LIMITATION, A PREHEARING SCHEDULING ORDER ADDRESSING (A) EACH PARTY’SDUTY TO SUBMIT A DETAILED STATEMENT OF CLAIMS, DAMAGES AND/OR DEFENSES, ASTATEMENT OF THE ISSUES ASSERTED BY EACH PARTY AND ANY LEGAL AUTHORITIES THEPARTIES MAY WISH TO BRING TO THE ATTENTION OF THE ARBITRATORS; (B) RESPONSESAND/OR REPLIES TO THE PLEADINGS FILED IN COMPLIANCE WITH SUBPART 2(A); (C)STIPULATIONS REGARDING ANY UNCONTESTED FACTS; (D) EXCHANGE AND PREMARKING OFALL DOCUMENTS. WHICH EACH PARTY BELIEVES MAY BE OFFERED AT THE FINALARBITRATION HEARING; (E) THE IDENTIFICATION AND AVAILABILITY OF WITNESSES, INCLUDINGEXPERTS, AND SUCH ADDITIONAL MATTERS REGARDING WITNESSES INCLUDING THEIRBIOGRAPHIES AND A SHORT SUMMARY OF THEIR EXPECTED TESTIMONY, (F) WHETHER ASTENOGRAPHIC OR OTHER OFFICIAL RECORD OF THE PROCEEDINGS SHALL BE MAINTAINED;AND (G) THE POSSIBILITY OF UTILIZING MEDIATION OR OTHER ALTERNATIVE METHODS OFDISPUTE RESOLUTION.**

 

**(f)****                                    FORPURPOSES OF THIS PROVISION, “THE PARTIES” MEANS GRANTORS, BENEFICIARY ANDTRUSTEE, AND EACH AND ALL PERSONS AND ENTITIES SIGNING THIS AGREEMENT OR ANYOTHER AGREEMENTS BETWEEN OR AMONG ANY OF THE PARTIES AS PART OF THISTRANSACTION. “THE PARTIES” SHALL ALSO INCLUDE INDIVIDUAL PARTNERS, AFFILIATES,OFFICERS, DIRECTORS, EMPLOYEES, AGENTS AND/OR REPRESENTATIVES OF ANY PARTY TOSUCH DOCUMENTS, AND SHALL INCLUDE ANY OTHER OWNER AND HOLDER OF THIS AGREEMENT.**

 

**(g)****                                 THEPARTIES SHALL HAVE THE RIGHT TO INVOKE SELF- HELP REMEDIES (SUCH AS SET-OFF,NOTIFICATION OF ACCOUNT DEBTORS, SEIZURE AND/OR FORECLOSURE OF COLLATERAL, ANDNON-JUDICIAL SALE OF PERSONAL PROPERTY AND REAL PROPERTY COLLATERAL) BEFORE,DURING OR AFTER ANY ARBITRATION AND/OR REQUEST ANCILLARY OR PROVISIONALJUDICIAL REMEDIES (SUCH AS GARNISHMENT, ATTACHMENT, SPECIFIC PERFORMANCE,RECEIVER, INJUNCTION OR RESTRAINING ORDER, AND SEQUESTRATION) BEFORE OR AFTERANY ARBITRATION. THE PARTIES NEED NOT AWAIT THE OUTCOME OF THE ARBITRATIONBEFORE USING SELF-HELP REMEDIES. USE OF SELF-HELP OR ANCILLARY AND/ORPROVISIONAL JUDICIAL REMEDIES SHALL NOT OPERATE AS A WAIVER OF EITHER PARTY’SRIGHT TO COMPEL ARBITRATION. ANY ANCILLARY OR PROVISIONAL REMEDY WHICH WOULD BEAVAILABLE FROM A COURT AT LAW SHALL BE AVAILABLE FROM THE ARBITRATORS.**

 

**(h)****                                 THEPARTIES AGREE THAT ANY ACTION REGARDING ANY CONTROVERSY BETWEEN THE PARTIES SHALLEITHER BE BROUGHT BY ARBITRATION, AS DESCRIBED HEREIN, OR BY JUDICIALPROCEEDINGS, BUT SHALL NOT BE PURSUED SIMULTANEOUSLY IN DIFFERENT ORALTERNATIVE FORMS. A TIMELY WRITTEN NOTICE OF INTENT TO ARBITRATE PURSUANT TOTHIS AGREEMENT STAYS AND/OR ABATES ANY AND ALL ACTION IN A TRIAL COURT, SAVEAND EXCEPT A HEARING ON AMOTION TO COMPEL ARBITRATION AND/OR THE ENTRY OF ANORDER COMPELLING ARBITRATION AND STAYING AND/OR ABATING THE LITIGATION PENDINGTHE FILING OF THE FINAL AWARD OF THE ARBITRATORS. ALL REASONABLE AND NECESSARYATTORNEY’S FEES AND ALL TRAVEL COSTS SHALL BE AWARDED TO THE PREVAILING PARTYON ANY MOTION TO COMPEL ARBITRATION AND MUST BE PAID TO SUCH PARTY WITHIN TEN(10) DAYS OF THE SIGNING OF THE ORDER COMPELLING ARBITRATION.**

 

**(i)****                                    ANYPARTY SEEKING TO ARBITRATE SHALL SERVE A WRITTEN NOTICE OF INTENT TO ARBITRATETO**

 

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**ANY ANDALL OPPOSING PARTIES WITHIN 360 DAYS AFTER DISPUTE HAS ARISEN. A DISPUTE ISDEFINED TO HAVE ARISEN ONLY UPON RECEIPT OF SERVICE OF JUDICIAL PROCESS,INCLUDING SERVICE OF A COUNTERCLAIM, FAILURE TO SERVE A WRITTEN NOTICE OFINTENT TO ARBITRATE WITHIN THE TIME SPECIFIED ABOVE SHALL BE DEEMED AWAIVER OFTHE AGGRIEVED PARTY’S RIGHT TO COMPEL ARBITRATION OF SUCH CLAIM. THE ISSUE OFWAIVER PURSUANT TO THIS AGREEMENT IS AN ARBITRABLE DISPUTE.**

 

**(j)****                                    ACTIVEPARTICIPATION IN PENDING LITIGATION DURING THE 360 DAY NOTICE PERIOD, WHETHER ASPLAINTIFF OR DEFENDANT, IS NOT A WAIVER OF THE RIGHT TO COMPEL ARBITRATION. ALLDISCOVERY OBTAINED IN THE PENDING LITIGATION MAY BE USED IN ANY SUBSEQUENTARBITRATION PROCEEDING.**

 

**(k)****                                THEPARTIES FURTHER AGREE THAT (i) NO ARBITRATION PROCEEDING HEREUNDER SHALL BE CERTIFIEDAS A CLASS ACTION OR PROCEED AS A CLASS ACTION, OR ON A BASIS INVOLVING CLAIMSBROUGHT IN A PURPORTED REPRESENTATIVE CAPACITY ON BEHALF OF THE GENERAL PUBLIC,OTHER CUSTOMERS OR POTENTIAL CUSTOMERS OR PERSONS SIMILARLY SITUATED AND (ii)NO ARBITRATION PROCEEDING HEREUNDER SHALL BE CONSOLIDATED WITH, OR JOINED INANY WAY WITH, ANY OTHER ARBITRATION PROCEEDING**

 

**(I)****                                    ANYARBITRATOR SELECTED SHALL BE KNOWLEDGEABLE IN THE SUBJECT MATTER OF THEDISPUTE. EACH OF THE PARTIES SHALL PAY AN EQUAL SHARE OF THE ARBITRATION COSTS,FEES, EXPENSES, AND OF THE ARBITRATORS’ FEES, COSTS AND EXPENSES.**

 

**(m)****                              ALLSTATUTES OF LIMITATIONS WHICH WOULD OTHERWISE BE APPLICABLE SHALL APPLY TO ANYAND ALL CLAIMS ASSERTED IN ANY ARBITRATION PROCEEDING HEREUNDER AND THECOMMENCEMENT OF ANY ARBITRATION PROCEEDING TOLLS SUCH STATUTES OF LIMITATIONS.**

 

**(n)****                                 INANY ARBITRATION PROCEEDING SUBJECT TO THIS PROVISION, THE ARBITRATORS, ORMAJORITY OF THEM, ARE SPECIFICALLY EMPOWERED TO DECIDE (BY DOCUMENTS ONLY, ORWITH A HEARING, AT THE ARBITRATORS’ SOLE DISCRETION) PRE-HEARING MOTIONS WHICHARE SUBSTANTIALLY SIMILAR TO PREHEARING MOTIONS TO DISMISS AND MOTIONS FORSUMMARY ADJUDICATION.**

 

**(0)****                                 THISARBITRATION PROVISION SHALL SURVIVE ANY TERMINATION, AMENDMENT, OR EXPIRATION OFTHE AGREEMENT IN WHICH THIS PROVISION IS CONTAINED, UNLESS ALL OF THE PARTIESOTHERWISE EXPRESSLY AGREE IN WRITING**

 

**(p)****                                  THEPARTIES ACKNOWLEDGE THAT THIS AGREEMENT EVIDENCES A TRANSACTION INVOLVINGINTERSTATE COMMERCE. THE FEDERAL ARBITRATION ACT SHALL GOVERN THEINTERPRETATION, ENFORCEMENT, AND PROCEEDINGS PURSUANT TO THE ARBITRATION CLAUSEOF THIS AGREEMENT.**

 

**(q)****                                  THEARBITRATORS, OR A MAJORITY OF THEM, SHALL AWARD ATTORNEY’S FEES AND COSTS TOTHE PREVAILING PARTY PURSUANT TO THE TERMS OF THIS AGREEMENT.**

 

**(r)****                                  NEITHERTHE PARTIES NOR THE ARBITRATORS MAY DISCLOSE THE EXISTENCE, CONTENT, OR RESULTSOF ANY ARBITRATION HEREUNDER WITHOUT PRIOR WRITTEN CONSENT OF ALL PARTIESAND/OR COURT ORDER**

 

**(s)****                                  VENUEOF ANY ARBITRATION PROCEEDING HEREUNDER SHALL BE IN THE COUNTY WHEREBENEFICIARY IS LOCATED.**

 

Notwithstandingthe provision above relating to conducting a foreclosure sale(s) pursuant tothe provisions of this Deed Of Trust, the Trustee shall, and is hereby directedto, comply with the provisions of Chapter 51 of the Texas Property Code (the “PropertyCode”) as it may be amended and in effect as of the date or dates of anyforeclosure proceedings conducted pursuant to this Deed Of Trust. Inparticular, the location and time of sale shall be held in accordance with Section 51.002of the Property Code or any amendments thereto or re-enactment or revisions tosuch law.

 

Grantorsstipulate and agree that for purposes of determining the fair market value ofthe Property (or any portion thereof), as such term is used in Section 51.003of the Texas Property Code, which is sold at a non-judicial foreclosure salepursuant to the terms of this Deed Of Trust (and in accordance with Section 51.002of the Property Code), the following factors shall be used to determine suchProperty’s fair market value, for such purposes: (a) the Property shall bevalued “AS IS” without any value being anticipated for any improvements orrefurbishing to be conducted, or conducted, after the date of the foreclosuresale, (b) the intention of the purchaser to re-sell the Property promptly,without any extensive holding period, (c) any re-sale shall be for cash only,without financing by the seller, (d) all reasonable costs of closing a re-saleshall be deducted from the reasonable costs of closing a re-sale shall bededucted from the estimate of fair market value, such as attorneys’ fees, titlepolicy premiums, surveyor fees and expenses, the then prevailing broker’s or salesmancommission, unpaid ad valorem tax amounts, and (e) the application of adiscount to the value to be applied to any future sales price to arrive at itsthen current fair market value. Grantors further stipulate that any value givento such Property in connection with Grantors’ obtaining of the loan fromBeneficiary to which this Deed Of Trust relates, or not any other time ortimes, shall not be used and shall not be considered for guidance indetermining the fair market value of such Property on the date of any suchforeclosure sale.

 

LeaseholdCovenants. If the interest of Grantors in the Propertyis a leasehold interest and not a fee ownership, then the lien of this Deed OfTrust shall be upon the leasehold rights and benefits of Grantors, but, in noevent shall any of the burdens or obligations under said leasehold be assumedby, or be the obligations of, Beneficiary absent an express written instrument,executed by Beneficiary assuming such obligations, which shall be within thesole discretion of Beneficiary.

 

To the extentGrantors own a leasehold interest in all or any portion of the Property,Grantors hereby covenant and agree as follows:

 

(a)                                  Grantorswill at all times fully perform and comply with all agreements, covenants,terms and conditions imposed upon or assumed by it, as tenant or lessee, underany and all leases affecting the Property (collectively, the “Lease”), true andcorrect copies of

 

11

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which Grantorsshall deliver to Beneficiary, and that if Grantors shall fail to do so,Beneficiary may (but shall not be obligated to) take any action Beneficiarydeems necessary or desirable to prevent or to cure any default by Grantors inthe performance of or compliance with any of Grantor’s covenants or obligationsunder the Lease. Upon receipt by Beneficiary from the landlord wider the Leaseof any written notice of default by Grantors thereunder, default or any writtennotice of default, or the nature thereof be questioned or denied by Grantors orby any party on and on behalf of Grantors, Grantors hereby expressly grant toBeneficiary and agree that Beneficiary shall have the absolute and immediateright to enter in and upon the leased premises or any part thereof thatBeneficiary deems necessary or desirable in order to prevent or to cure anydefault by Grantors under the Lease. Beneficiary may pay and expend such sumsof money as Beneficiary in its sole discretion deems necessary for any suchpurpose, and Grantors hereby agree to pay to Beneficiary, immediately upondemand, all such sums so paid and expended by Beneficiary. All sums so paid andexpended by Beneficiary shall accrue interest at the rates set forth in theNote and be added to and be secured by the lien of this Deed Of Trust.

 

(b) Grantorswill not surrender the leasehold estate and interest hereinabove described, norterminate or cancel the Lease; and it will not; without the express writtenconsent of Beneficiary, modify, change, supplement, alter or amend the Leaseeither orally or in writing. Any such termination, cancellation, modification,change, supplement, alteration or amendment of the Lease without the priorwritten consent thereto by Beneficiary shall be void and of no force andeffect. As further security to Beneficiary, Grantors shall deposit withBeneficiary an original of the Lease and all amendments thereto or a certifiedcopy thereof, to be retained by Beneficiary until the indebtedness securedhereby is fully paid.

 

(c) No releaseor forbearance of any of Grantors’ obligations under the Lease, pursuant to theLease or otherwise, shall release Grantors from any of its obligations underthis Deed Of Trust, including obligations with respect to the payment of rentas provided for in the Lease and the performance of all of the terms,provisions, covenants, conditions and agreements contained in the Lease, to bekept, performed and complied with by Grantors therein.

 

(d) UnlessBeneficiary shall otherwise expressly consent in writing, the fee title to theproperty demised by the Lease and the leasehold estate shall not merge butshall always remain separate and distinct, notwithstanding the union of saidestates either in the landlord or in the tenant, or in a third party bypurchase or otherwise..

 

(e)                                  Ifthere shall be filed by or against Grantors a petition under the BankruptcyCode, 11 U.S.C. § 101 et seq. (the “Bankruptcy Code”), and Grantors, aslessee under the Lease, shall determine to reject the Lease pursuant to Section 365(a)of the Bankruptcy Code, Grantors shall give Beneficiary not less than thirty(30) days prior notice of the date on which Grantors shall apply to theBankruptcy Court for authority to reject the Lease. Beneficiary shall have theright, but not the obligation, to serve upon Grantors within such ten dayperiod a notice stating that (i) Beneficiary demands that Grantors assume andassign the Lease to Beneficiary pursuant to Section 365 of the BankruptcyCode and (ii) Beneficiary covenants to cure or provide adequate assurance ofprompt cure of all defaults and provide adequate assurance of futureperformance under the Lease. If Beneficiary serves upon Grantors the noticedescribed in the preceding sentence, Grantors shall not seek to reject theLease and shall comply with the demand provided for in the clause (i) of thepreceding sentence, within 30 days after the notice shall have been givensubject to the performance by Beneficiary of the covenant provided for inclause (ii) of the preceding sentence. Further, effective upon the entry of anorder for relief in respect of Grantors under Chapter 7 of the Bankruptcy Code,Grantors hereby assign and transfer to Beneficiary a non-exclusive right toapply to the Bankruptcy Court under Subsection 365(d)(I) of the BankruptcyCode for an order extending the period during which the Lease may be rejected orassumed.

 

**NO ORAL AGREEMENTS**

 

**THISWRITTEN AGREEMENT REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAYNOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEOUENT ORALAGREEMENT OF**

**THE PARTIES.**

 

**THERE ARENO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES**.

 

Dated this 17 day of December, 2004.

 
| GRANTOR: | LANCER PARTNERSHIP, LTD.,                | GRANTOR: |
|----------|------------------------------------------|----------|
|     | A Texas limited partnership              |     |
|     | By: Lancer Capital Corporation,          |     |
|     | A Delaware  corporation, General Partner |     |

 

 
| By:    | /s/ Scott  Adams |   | By:      |   |   |
|--------|------------------|--------|----------|--------|--------|
|   |             |
| Name:  | Scott Adams      |   | Address: |   |   |
|   |             |   |     |
| Title: | Secretary        |   |     |   |   |
|        |                  |        |          |        |        |  |  |  |  |

 

(Acknowledgement)

 
| STATE OF TEXAS |   | § |
|----------------|--------|--------|
|           |   |   |
| COUNTY OF      |   |   |   | § |
|                |        |        |  |  |

 

This instrument was acknowledged before me on

by                                                                                                           .

 

 
|   |                          |
|--------|-------------------------------|
|   | Notary Public, State of Texas |
|   |                          |
|   | My commission expires         |   |

 

12

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(Acknowledgment)

 
| STATE OF TEXAS | § |
|----------------|--------|
|           | § |
| COUNTY OF      |   |   | § |
|                |        |  |  |

 

This instrument was acknowledged before me on

by                                                                                                           .

 

 
|   |                          |
|--------|-------------------------------|
|   | Notary Public, State of Texas |
|   |                          |
|   | My commission expires:        |   |

 

 

(Partnership Acknowledgment)

 
| STATE OF TEXAS |   | § |
|----------------|--------|--------|
|           |   | § |
| COUNTY OF      |   |   |   | § |
|                |        |        |  |  |

 

This instrument was acknowledged before me on December 17, 2004 byof Lancer Capital Corporation, a Delaware corporation, General, partner(s) onbehalf of Lancer Partnership, Ltd., a Texas limited partnership, on behalf ofsaid, partnership

 

 
|   | /s/ Scott A. Farrimond |
|--------|---------------------------------------|
|   | Notary Public, State of Texas         |
|   |                                  |
|   | My commission expires:                | 6/28/08 |

 

 

(Corporation Acknowledgement)

 
| STATE OF TEXAS |   | § |
|----------------|--------|--------|
|           |   | § |
| COUNTY OF      |   |   |   | § |
|                |        |        |  |  |

 

 

This instrument was acknowledged before me on                                                                                                                         by                                                                                    as                                                                                                                         a                                                                                                                                 corporation, on behalf of said corporation

 

 
|   |                          |
|--------|-------------------------------|
|   | Notary Public, State of Texas |
|   |                          |
|   | My commission expires:        |   |

 

Afterrecording, return to Beneficiary, at its mailing address, as follow:

 

AFTERRECORDING, PLEASE RETURN TO: 

INTERNATIONALBANK OF COMMERCE

CreditDepartment

130 E. Travis

San Antonio,Texas 78205

 

13

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*** ADDENDUM TO DEED OF TRUST,ASSIGNMENT OF RENTS, SECURITY**

### **AGREEMENT AND FINANCINGSTATEMENT**

 

The Note isgiven in renewal, extension, modification, and rearrangement of that onecertain Promissory Note in the original principal sum of **Forty-fourMillion Eight Hundred Twenty-three Thousand Seven Hundred Fifty and No/100Dollars ($44,823,750.00),** dated June 30, 2000, executed by Grantors,and payable to the order of The Frost National Bank more fully described in andsecured in a Deed of Trust, of even date therewith, executed by Grantors andrecorded in Volume 8634, Page 1641, of the Real Property Records of BexarCounty, Texas, upon the herein described real property, which said liens andnotes, have been assigned and transferred to **INTERNATIONALBANK OF COMMERCE**. It is expressly agreed that said liens are herebyrenewed, extended, and continued in full force and effect to secure the paymentof the Note hereby secured.

 

This Deed of Trust is beingexecuted pursuant to the terms and conditions of that certain Loan Agreement ofeven date herewith between Grantors and Beneficiary and which Loan Agreementwill govern in case of conflict with this Deed of Trust.

 

Executed on this 17 day ofDecember, 2004.

 

**GRANTORS:**

 

**LancerPartnership, Ltd.,**

**a Texaslimited partnership**

 
| **By:**    | **Lancer  Capital Corporation,**            |
|------------|---------------------------------------------|
|       | **a Delaware corporation, General Partner** |
|       |                                        |
| ** ** | **By:**                                     | **     /s**/ Scott Adams |   |
| ** ** | **Name:**                                   |   Scott  Adams |   |
| ** ** | **Title:**                                  | **   Secretary** | ** ** |
|            |                                             |  |  |  |  |  |

 

 
| **STATE OF TEXAS** | ** ** | **§** |
|--------------------|------------|------------|
| ** **         | ** ** | **§** |
| **COUNTY OF**      | ** ** | ** ** | ** ** | **§** |
|                    |            |            |  |  |

 

Beforeme, the undersigned authority, on this day personally appeared                                                               ,                      of Lancer Capital Corporation, a Delaware corporation, General Partner ofLancer Partnership, Ltd., a Texas limited partnership, known to me to be theperson whose name is subscribed to the foregoing instrument, and acknowledgedto me that he executed the same for the purposes and consideration thereinexpressed, in the capacity therein stated and as the act and deed of saidpartnership.

 

Givenunder my hand and seal of office on this 17th day of December, 2004.

 

 
|       |  /s/ Scott A. Farrimond |
|------------|---------------------------------------------|
| ** ** | **Notary Public,  State of Texas**          |

 

----

 

FOR

TRACT “A”

 

Being a 20.000 acre tractof land out of the J.J. Sanchez Survey, No.34, Abstract No. 665, County Block5100, Bexar County, Texas, the said 2O.OOO acre tract of land being a portionof a 189.56 acre tract of land as recorded in Volume 7977, Pages 806–810 of theDeed Records of Bexar County, Texas, and a portion of a 120.935 acre tract ofland as recorded in Volume 7345, Pages 825-829 of the Deed Records of BexarCounty, Texas, and being more particularly described by metes and bounds asfollows:

 
| COMMENCING: |   | At a point for the  southerly end of the cutback line for the intersection of the east  right-of-way line of Foster~ Road with the south right-of-way line of I.H.-10  (U.S. Highway 90), and proceeding along the following course:                                                                  |
|-------------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|        |   |                                                                                                                                                                                                                                                                                                       |
|        |   | 1,244.77 feet in a  southerly direction along the said east right-of-way line of Foster Road to  an iron pin found at the northwest corner of the said 189.56 acre tract of  land;                                                                                                                         |
|        |   |                                                                                                                                                                                                                                                                                                       |
| THENCE:     |   | N 89°29’00” E, a  distance of 800.00 feet departing from the aforementioned east right-of-way  line of Foster Road, along the north line of the said 189.56 acre tract of  land to an iron pin set for the northwest corner, and POINT OF BEGINNING of  the herein described tract of land; |
|        |   |                                                                                                                                                                                                                                                                                                       |
| THENCE:     |   | N 89°29’00” E, a  distance of 670.16 feet continuing along the said north line of the 189.56  acre tract of land to an iron pin set for the northeast corner of the herein  described tract of land;                                                                                        |
|        |   |                                                                                                                                                                                                                                                                                                       |
| THENCE:     |   | S OO°14’O0” E, a  distance of 1,300.00 feet departing from the aforementioned north line of the  189.56 acre tract of land to an iron pin set for the southeast corner of the  herein described tract of land;                                                                              |
|        |   |                                                                                                                                                                                                                                                                                                       |
| THENCE:     |   | S 89°29’00” W, a  distance of 670.16 feet to an iron pin set for the southwest corner of the  herein described tract of land;                                                                                                                                                               |
|        |   |                                                                                                                                                                                                                                                                                                       |
| THENCE:     |   | N O0°14’OO” W, a  distance of 1,300.00 feet to the POINT OF BEGINNING and containing 20.000  acres or 871,200 square feet of land, more or less, in Bexar County, Texas.                                                                                                                    |

 

PREPARED BY: PAPE-DAWSONCONSULTING ENGINEERS, INC.

JOB NO.:                                               2269-60-20

DATE: July 9, 1986;Revised September 26, 1986

DOC. ID:                                                FN10/12

 

UTILITES   ROADS& STREETS   DRAINAGE   LAND PLANNING   SUBDIVISIONS   VISIONS   REPORTS   SURVEYING

 

----

 

FOR

TRACT “B”

 

Being a 20.000 acre tractof land out of the J.J. Sanchez Survey, No.34, Abstract No. 665, County Block5100, Bexar County, Texas, the said 2O.OOO acre tract of land being a portionof a 189.56 acre tract of land as recorded in Volume 7977, Pages 806–810 of theDeed Records of Bexar County, Texas, and a portion of a 120.935 acre tract ofland as recorded in Volume 7345, Pages 825-829 of the Deed Records of BexarCounty, Texas, and being more particularly described by metes and bounds asfollows:

 
| COMMENCING: |   | At a point for the southerly end of the  cutback line for the intersection of the east right-of-way line of  Foster~ Road with the south right-of-way line of I.H.-10 (U.S. Highway 90),  and proceeding along the following course:                                                                    |
|-------------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|        |   |                                                                                                                                                                                                                                                                                                         |
|        |   | 1,244.77 feet in a southerly direction  along the said east right-of-way line of Foster Road to an iron pin found at  the northwest corner of the said 189.56 acre tract of land;                                                                                                                            |
|        |   |                                                                                                                                                                                                                                                                                                         |
| THENCE:     |   | N 89°29’00” E, a distance of 1,470.16 feet  departing from the aforementioned east right-of-way line of Foster Road,  along the north line of the said 189.56 acre tract of land to an iron pin set  for the northwest corner, and POINT OF BEGINNING of the herein described tract  of land; |
|        |   |                                                                                                                                                                                                                                                                                                         |
| THENCE:     |   | N 89°29’00” E, a distance of 670.16 feet  continuing along the said north line of the 189.56 acre tract of land to an  iron pin set for the northeast corner of the herein described tract of land;                                                                                           |
|        |   |                                                                                                                                                                                                                                                                                                         |
| THENCE:     |   | S OO°14’O0” E, a distance of 1,300.00 feet  departing from the aforementioned north line of the 189.56 acre tract of land  to an iron pin set for the southeast corner of the herein described tract of  land;                                                                                |
|        |   |                                                                                                                                                                                                                                                                                                         |
| THENCE:     |   | S 89°29’00” W, a distance of 670.16 feet to  an iron pin set for the southwest corner of the herein described tract of  land;                                                                                                                                                                 |
|        |   |                                                                                                                                                                                                                                                                                                         |
| THENCE:     |   | N O0°14’OO” W, a distance of 1,300.00 feet  to the POINT OF BEGINNING and containing 20.000 acres or 871,200 square feet  of land, more or less, in Bexar County, Texas.                                                                                                                      |

 

PREPARED BY: PAPE-DAWSONCONSULTING ENGINEERS, INC.

JOB NO.:                                               2269-60-20

DATE: July 9, 1986;Revised September 26, 1986

DOC. ID:                                                FN10/11

 

UTILITES   ROADS& STREETS   DRAINAGE   LANDPLANNING   SUBDIVISIONS   VISIONS   REPORTS   SURVEYING

 

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