TEXAS
        ASSOCIATION OF REALTORS*

      


      IMPROVED
        PROPERTY COMMERCIAL LEASE

      


      USE
        OF THE FORMS BY PERSONS WHO ARE NOT MEMBERS OF THE TEXAS ASSOCIATION OF REALTORS
        IS NOT AUTHORIZED

      *Texas
        Association of REALTORS

       

        
          

        

      

       

      
        	
                1.

              	
                PARTIES:
                  The parties to this lease are the owner of the Property Paul
                  & Sherry Vick dba P & S Properties LLC(Landlord) and 
                  

                the
                  tenant Shumate
                  Machine Works Inc.Subsidiary of Excalibur
                  Industries

              


      

      


      
        	
                2.

              	
                LEASED
                  PREMISES: Landlord leases to Tenant the following described real
                  property,
                  known as the “leased premises,” along with all its
                  improvements:

              


      

      


      Number
        Bldg.
        “D”
        (suite
        or unit),
        containing approximately 25,500
        square
        fee of rentable area, located within the 3083
        Industrial Park(building
        or complex name)
        on the
        land known as 12060
        FM 3083 Conroe, TX
        (address,
        city, state)
        which
        is legally described as Or ______________________   £
        as
        described on attached exhibit. “Property” means the building or complex in which
        the leased premises are located, inclusive of any common areas, drives, parking
        areas, and walks. The parties agree that the rentable area of the leased
        premises may not equal the actual or useable area within the leased premises
        and
        may include an allocation of common areas in the Property.

       

      
        
          	
                  3.    
                    

                	
                  TERM:

                


        

      

       

      
        	
                A.

              	
                Term:
                  The term of this lease is    60      months,
                  commencing on July
                  1st,
                  2004(Commencement
                  Date) and ending on  June
                  30th,
                  2009  (Expiration
                  Date).

              
	 	 
	
                B.

              	
                Delay
                  of Occupancy:
                  If Tenant is unable to occupy the leased premises on the Commencement
                  Date
                  because of construction on the leased premises to be completed
                  by Landlord
                  that is not substantially complete or a prior tenant’s holding over of the
                  leased premises, Landlord will not be liable to Tenant for such
                  delay and
                  this lease will remain enforceable. In the event of such a delay,
                  the
                  Commencement Date will automatically be extended to the date Tenant
                  is
                  able to occupy the Property and the Expiration Date will also be
                  extended
                  by a like number of days, so that the term of this lease remains
                  unchanged. If Tenant is unable to occupy the leased premises after
                  the
                  30th
                  day after the Commencement Date because of construction on the
                  leased
                  premises to be completed by Landlord that is not substantially
                  complete or
                  a prior tenant’s holding over of the leased premises, Tenant may terminate
                  this lease by giving written notice to Landlord before the leased
                  premises
                  become available to be occupied by Tenant and Landlord will refund
                  to
                  Tenant any amounts paid to Landlord by Tenant. This Paragraph 3B
                  does not
                  apply to any delay in occupancy caused by cleaning or
                  repairs.

              


      

       

      
        	
                4.

              	
                RENT
                  AND EXPENSES:

              


      

      


      
        	
                A.

              	
                Base
                  Monthly Rent:
                  On or before the first day of each month during this lease, Tenant
                  will
                  pay Landlord base monthly rent in the amount of 22,600.00.
                  The first full base monthly rent is due on or before August
                  1st,
                  2004                                 
                  

              
	 	 
	 	
                *NOTE:
                  Tenant to pay the $3,000.00 extra rent toward last months
                  payment.

              
	 	 
	
                B.

              	
                Prorated
                  Rent:
                  If the Commencement Date is on a day other than the first day of
                  a month,
                  Tenant will pay Landlord as prorated rent, an amount equal to the
                  base
                  monthly rent multiplied by the following fraction; the number of
                  days from
                  the Commencement Date to the first day of the following month divided
                  by
                  the number of days in the month in which this lease commences.
                  The
                  prorated rent is due on or before the Commencement
                  Date.

              
	 	 
	
                C.

              	
                Additional
                  Rent:
                  In addition to any base monthly rent or prorated rent, Tenant will
                  pay
                  landlord all other amounts as provided by the
                  attached:

              


      

      
        	
                £

              	
                (1)

              	
                Net
                  Addendum

              
	
                £

              	
                (2)

              	
                Percentage
                  Rent Addendum

              
	
                £

              	
                (3)

              	
                Expense
                  Reimbursement Addendum

              
	
                £

              	
                (4)

              	
                Expense
                  Addendum for Single-Tenant Property

              
	
                £

              	
                (5)

              	
                Parking
                  Addendum

              
	
                £

              	
                (6)

              	
                 

              


      

       

      
        
          
          

        

        
          1

          
            

          

        

        
          
          

        

      


      Commercial
        Lease concerning: 12060
        FM 3083 Conroe, TX

       

      
        	
                D.

              	
                Place
                  of Payment:
                  Tenant will remit all amounts due Landlord under this lease to
                  P
                  & S Properties LLC at
                  11449
                  Outpost Cove Willis, Tx. 77318
                  or
                  to such other person or at such other place as Landlord may designate
                  in
                  writing.

              
	 	 
	
                E.

              	
                Method
                  of Payment:
                  Tenant must pay all rent timely without demand, deduction, or offset,
                  except as permitted by law or this lease. Time is of the essence
                  for the
                  payment of rent. If Tenant falls to timely pay any amounts due
                  under this
                  lease or if any check of Tenant is returned to landlord by the
                  institution
                  on which it was drawn, Landlord may require Tenant to pay, in addition
                  to
                  any other available remedy, all amounts due under this lease by
                  certified
                  funds by providing written notice to Tenant.

              
	 	 
	
                F.

              	
                Late
                  Charges:
                  If Landlord does not actually
                  receive
                  a
                  rent payment at the designated place of payment within 5 days after
                  the
                  date the rent is due, Tenant will pay Landlord a late charge equal
                  to 5%
                  of the base monthly rent. The mailbox is not the agent for receipt
                  for
                  Landlord. The late charge is a cost associated with the collection
                  of rent
                  and Landlord’s acceptance of a late charge does not waive Landlord’s
                  rights to exercise remedies under Paragraph 20.

              
	 	 
	
                G.

              	
                Returned
                  Checks:
                  Tenant will pay $25.00
                  (not
                  to exceed $25)
                  for each check Tenant tenders to Landlord which is returned by
                  the
                  institution on which it is drawn for any reason, plus any late
                  charges
                  until Landlord receives payment.

              


      

       

      
        	
                5.

              	
                SECURITY
                  DEPOSIT: Upon execution of this lease, Tenant will pay a security
                  deposit
                  to Landlord in the amount of ______________ . Landlord may apply the
                  security deposit to any amounts owed by Tenant under this Lease.
                  If
                  Landlord applies any part of the security deposit during any time
                  this
                  lease is in effect to amounts owed by Tenant, Tenant must, within
                  10 days
                  after receipt of notice from Landlord, restore the security deposit
                  to the
                  amount stated. Within a reasonable time after this lease ends,
                  Landlord
                  will refund the security deposit to Tenant less any amounts applied
                  toward
                  amounts owed by Tenant

              


      

    

    

      
        	
                6.

              	
                TAXES:
                  Unless otherwise agreed by the parties, Landlord will pay all real
                  property ad valorem taxes assessed against the leased premises.
                  Tenant to
                  pay inventory taxes.

              
	 	 
	
                7.

              	
                UTILITIES:
                  Tenant will pay all charges for the use of all utility services
                  to the
                  leased premises and any connection charges except the following
                  which will
                  be paid by Landlord. 

              
	 	
                NOTICE:
                  Tenant should determine if any and all necessary utilities (e.g.,
                  water,
                  gas, electricity, telephone, sewer, etc.) are available to the
                  leased
                  premises, are adequate for Tenant’s intended use, and the cost to provide
                  the necessary utilities.

              
	 	 
	
                8.

              	
                TENANT’S
                  INSURANCE:

              


      

    

    
      
         

      

      
        	
                A.

              	
                During
                  all times this lease is in effect, Tenant must maintain in full
                  force and
                  effect

              


      

      


      
        	
                (1)

              	
                public
                  liability insurance from an insurer acceptable to Landlord in an
                  amount
                  not less than $1,000,000.00                                                         
                   

              
	 	
                           
                  $1,000,000.00     on
                  an occurrence basis naming Landlord as an additional insured;
                  and

              
	
                 

              	
                 

              
	
                (2)

              	
                personal
                  property damage insurance for Tenant’s business operations on the leased
                  premises from an insurer acceptable to Landlord in an amount not
                  less
                  than                                                                                                                  
                   on an occurrence basis.

              


      

      


      
        	
                B.

              	
                Before
                  the Commencement Date, Tenant must provide Landlord with a copy
                  of the
                  insurance certificates evidencing the required coverage. If the
                  Insurance
                  coverage changes in any manner or degree at any time this lease
                  is in
                  effect, Tenant must provide Landlord a copy of an insurance certificate
                  evidencing such change within 10 days of the change.

              
	 	 
	
                C.

              	
                If
                  Tenant fails to maintain the required insurance in full force and
                  effect
                  at all times this lease is in effect, Landlord may: (1) purchase
                  such
                  insurance on behalf of Tenant and Tenant must immediately reimburse
                  Landlord for such expense; or (2) exercise Landlord’s remedies under
                  Paragraph 20.

              
	 	 
	
                D.

              	
                If
                  there is an increase in Landlord’s insurance premiums for the leased
                  premises or Property or its contents that is caused by Tenant,
                  Tenant’s
                  use of the leased premises, or any improvements made by or for
                  Tenant,
                  Tenant will, for each year this lease is in effect, pay Landlord
                  the
                  increase immediately after Landlord notifies Tenant of the
                  increase.

              


      

       

      
        	
                9.

              	
                USE
                  AND HOURS: Tenant may use the leased premises for the following
                  purpose
                  and no other: Operation
                  of machine shop and work related to machine shop
                  operation.

              


      

      


      
        	 	
                £

              	
                A.

              	
                Tenant’s
                  Normal Business Hours:
                  Tenant’s normal business hours are (specify
                  hours, days of week, and if inclusive or exclusive of weekends
                  and
                  holidays):
                  7
                  days a week, 24 hrs. a day if
                  applicable           Tenant
                  will keep the leased premises open substantially during Tenant’s normal
                  business hours.

              


      


      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      


      Commercial
        Lease concerning: 12060
        FM 3083 Conroe, TX

      


      
        	
                £

              	
                B.

              	
                Building
                  Operating Hours:
                  The building in which the leased premises are located maintains
                  operating
                  hours of (specify
                  hours, days of week, and if inclusive or exclusive of weekends
                  and
                  holidays):                     
                  7
                  days a week, 24 hr.s a day if
                  applicable                       
                  

              
	 	 	
                If
                  Landlord is to provide HVAC services to the leased premises under
                  this
                  lease, Landlord is obligated to provide the HVAC services only
                  during the
                  specified building operating hours.

              


      

       

      
        	
                10.

              	
                LEGAL
                  COMPLIANCE:

              


      

      


      
        	
                    
                  A.

              	
                    
                  Tenant may not use or permit any part of the leased premises to
                  be used
                  for:

              


      

       

      
        	
                (1)

              	
                any
                  activity which is a nuisance or is offensive, noisy, or
                  dangerous;

              
	
                (2)

              	
                any
                  activity that interferes with any other tenant’s normal business
                  operations or Landlord’s management of the Property;

              
	
                (3)

              	
                any
                  activity that violates any applicable law, regulation, zoning ordinance,
                  restrictive covenant, governmental order, owners’ association rules,
                  tenants’ association rules, Landlord’s rules or regulations, or this
                  lease;

              
	
                (4)

              	
                any
                  hazardous activity that would require any insurance premium on
                  the
                  Property or leased premises to increase or that would void any
                  such
                  insurance;

              
	
                (5)

              	
                any
                  activity that violates any applicable federal, state, or local
                  law,
                  including but not limited to those laws related to air quality,
                  water
                  quality, hazardous materials, wastewater, waste disposal, air emissions,
                  or other environmental matters;

              
	
                (6)

              	
                the
                  permanent or temporary storage of any hazardous material;
                  or

              
	
                (7)

              	                                                                                                              
                 


      

       

      
        	
                B.

              	
                “Hazardous
                  material” means any pollutant, toxic substance, hazardous waste, hazardous
                  material, hazardous substance, solvent, or oil as defined by any
                  federal,
                  state, or local environmental law, regulation, ordinance, or rule
                  existing
                  as of the date of this lease or later enacted.

              
	 	 
	
                C.

              	
                Landlord
                  does not represent or warrant that the leased premises or Property
                  conform
                  to applicable restrictions, zoning ordinances, setback fines, parking
                  requirements, impervious ground cover ratio requirements, and other
                  matters that may related to Tenant’s intended use. Tenant
                  must satisfy itself that the leased premises may be used as Tenant
                  intends
                  by independently investigating all matters related to the use of
                  the
                  leased premises or Property. Tenant agrees that it is not relying
                  on any
                  warranty or representation made by Landlord, Landlord’s agent, or any
                  broker concerning the use of the leased premises or
                  Property.

              


      

       

      
        	
                11.

              	
                SIGNS:

              


      

      


      
        	
                A.

              	
                Tenant
                  may not post or paint any signs at, on, or about the leased premises
                  or
                  Property without Landlord’s written consent. Landlord may remove any
                  unauthorized sign, and Tenant will promptly reimburse Landlord
                  for any
                  expense related to the removal of any unauthorized sign. Any authorized
                  sign must comply with all laws, restrictions, zoning ordinances,
                  and any
                  governmental order relating to signs on the leased premises or
                  Property.
                  Landlord may temporarily remove any authorized sign to complete
                  repairs or
                  alterations to the leased premises or the Property.

              
	 	 
	
                B.

              	
                By
                  providing written notice to Tenant before this lease ends, Landlord
                  may
                  require Tenant, upon move-out and at Tenant’s expense, to remove, without
                  damage to the Property or leased premises, any or all signs that
                  were
                  placed on the Property or leased premises by or at the request
                  of Tenant.
                  Any signs that Landlord does not require Tenant to remove and that
                  are
                  fixtures become the property of the Landlord and must be surrendered
                  to
                  Landlord at the time this lease
                  ends.

              


      

       

      
        	
                12.

              	
                ACCESS
                  BY LANDLORD:

              


      

      


      
        	
                A.

              	
                During
                  Tenant’s normal business hours Landlord may enter the leased premise for
                  any reasonable purpose, including but not limited to purposes for
                  repairs,
                  maintenance, alterations, and showing the leased premises to prospective
                  tenants or purchases. Landlord may access the leased premises after
                  Tenant’s normal business hours with Tenant’s permission or to complete
                  emergency repairs. Landlord will not unreasonably interfere with
                  Tenant’s
                  business operations when accessing the leased premises.

              
	 	 
	
                B.

              	
                During
                  the last ______ days of this lease, Landlord may place a “For Lease” or
                  similarly worded sign in the leased
                  premises.

              


      

       

      
        	13.	
                MOVE-IN
                  CONDITION: Tenant has inspected the leased premises and accepts
                  it in its
                  present (as-is) condition unless expressly noted otherwise in this
                  lease.
                  Landlord
                  and any agent have made no express or implied warranties as to
                  the
                  condition or permitted use of the leased premises or Property.

              
	 	 
	
                14.

              	
                MOVE-OUT
                  CONDITION AND FORFEITURE OF TENANT’S PERSONAL
                  PROPERTY:

              


      

    

     

    
      	
              A.

            	
              At
                the time this lease ends, Tenant will surrender the leased premises
                in the
                same condition as when received, normal wear and tear excepted. Tenant
                will have the leased premises in a clean condition free of all trash,
                debris, personal property, hazardous materials, and environmental
                contaminants. Before this lease ends, Tenant £
                will T
                will not provide Landlord with a report, by an environmental engineer
                or
                assessor acceptable to landlord, dated not earlier than 20 days before
                the
                date this lease ends that indicates that no hazardous material or
                other
                environmental hazard is on or affects the leased
                premises.

            


    

    


    
      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

    

    


    Commercial
      Lease concerning: 12060
      FM 3083 Conroe, TX

    


    
      	
              B.

            	
              If
                Tenant leases any personal property in the leased premises after
                Tenant
                surrenders possession of the leased premises, Landlord may: (1) require
                Tenant, at Tenant’s expense, to remove the personal property by providing
                written notice to Tenant; or (2) retain such personal property as
                forfeited property to Landlord.

            
	 	 
	
              C.

            	
              “Surrender”
                means vacating the leased premises and returning all keys and access
                devices to Landlord. “Normal wear and tear” means deterioration that
                occurs without negligence, carelessness, accident, or
                abuse.

            
	 	 
	
              D.

            	
              By
                providing written notice to Tenant before this lease ends, Landlord
                may
                require Tenant, upon move-out and at Tenant’s expense, to remove, without
                damage to the Property or leased premises, any or all fixtures that
                were
                placed on the Property or leased premises by or at the request of
                Tenant.
                Any fixtures that Landlord does not require Tenant to remove become
                the
                property of the Landlord and must be surrendered to Landlord at the
                time
                this lease ends.

            


    

     

    
      
        	
                15.   
                  

              	
                MAINTENANCE
                  AND REPAIRS:

              


      

    

     

    
      	
              A.

            	
              Cleaning:
                Tenant must keep the leased premises clean and sanitary and promptly
                dispose of all garbage in appropriate receptacles. 

              £
                Landlord  T 
                Tenant will provide, at its expense, reasonable janitorial services
                to the
                leased premises.

            
	 	 
	
              B.

            	
              Repairs
                of Conditions Caused by a Party:
                Each party must promptly repair a condition caused, either intentionally
                or negligently, by that party or that party’s guests, patrons, invitees,
                contractors or permitted subtenants.

            
	 	
              Note:
                Landlord will provide grounds maintenance, mowing, etc.

            
	 	 
	
              C.

            	
              Repair
                and Maintenance Responsibility:
                Except as provided by Paragraph 15B, the party designated below,
                at its
                expense, is responsible to maintain and repair the following specified
                items in the leased premises. The specified items must be maintained
                in:
                (i) clean condition; (ii) good repair; and (iii) operable condition.
                If a
                modification to any of the specified items is required by law or
                governmental regulation or order, the party designated to maintain
                the
                item must complete and pay the expense of the modification. The
                specified items include and relate only to real property in the leased
                premises.
                Tenant is responsible for the repair and maintenance of its personal
                property.

            


    

     

    
      	 	 	 	
              N/A

            	 	
              Landlord

            	 	
              Tenant

            
	
              (1)

            	
              Foundation,
                exterior walls, roof, and other structural components

            	 	
              £

            	 	
              T

            	 	
              £

            
	 	 	 	 	 	 	 	 
	
              (2)

            	
              Glass
                and windows

            	 	
              £

            	 	
              £

            	 	
              T

            
	 	 	 	 	 	 	 	 
	
              (3)

            	
              Fire
                protection equipment and fire sprinkler systems

            	 	
              £

            	 	
              £

            	 	
              T

            
	 	 	 	 	 	 	 	 
	
              (4)

            	
              Exterior
                & overhead doors, including closure devices, molding, locks, and
                hardware

            	 	
              £

            	 	
              £

            	 	
              T

            
	 	 	 	 	 	 	 	 
	
              (5)

            	
              Grounds
                maintenance, including landscaping and ground sprinklers

            	 	
              £

            	 	
              T

            	 	
              £

            
	 	 	 	 	 	 	 	 
	
              (6)

            	
              Interior
                doors, including closure devices, frames, molding, locks, and
                hardware

            	 	
              £

            	 	
              £

            	 	
              T

            
	 	 	 	 	 	 	 	 
	
              (7)

            	
              Parking
                areas and walks

            	 	
              £

            	 	
              £

            	 	
              T

            
	 	 	 	 	 	 	 	 
	
              (8)

            	
              Plumbing
                systems, drainage system, electrical systems (including ballast and
                lamp
                replacement) & mechanical systems, except those specifically
                designated otherwise

            	 	
              £

            	 	
              £

            	 	
              T

            
	 	 	 	 	 	 	 	 
	
              (9)

            	
              Heating
                Ventilation and Air Conditioning (HVAC) systems

            	 	
              £

            	 	
              £

            	 	
              T

            
	 	 	 	 	 	 	 	 
	
              (10)

            	
              Signs

            	 	
              £

            	 	
              £

            	 	
              T

            
	 	 	 	 	 	 	 	 
	
              (11)

            	
              Extermination
                and pest control, excluding wood-destroying insects

            	 	
              £

            	 	
              £

            	 	
              T

            
	 	 	 	 	 	 	 	 
	
              (12)

            	
              Storage
                yards and storage buildings

            	 	
              £

            	 	
              £

            	 	
              T

            
	 	 	 	 	 	 	 	 
	
              (13)

            	
              Wood-destroying
                insect treatment and repairs

            	 	
              £

            	 	
              £

            	 	
              T

            
	 	 	 	 	 	 	 	 
	
              (14)

            	
              Cranes
                and related systems

            	 	
              £

            	 	
              £

            	 	
              T

            
	 	 	 	 	 	 	 	 
	
              (15)

            	
              Landlord
                will warranty bldg., mechanical, etc. for 1 year (with the exceptionof
                light bulbs)

            	 	
              £

            	 	
              £

            	 	
              £

            
	 	 	 	 	 	 	 	 
	
              (16)

            	
              All
                repairs thereafter will be @ the Tenant’s expense.

            	 	
              £

            	 	
              £

            	 	
              £

            
	 	 	 	 	 	 	 	 
	
              (17)

            	
              all
                other items and systems.

            	 	
              £

            	 	
              £

            	 	
              £

            


    

     

    
      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

    

    


    Commercial
      Lease concerning: 12060
      FM 3083 Conroe, TX

    


    
      	
              D.

            	
              Repair
                Persons:
                Repairs must be completed by trained, qualified, and insured repair
                persons.

            
	 	 
	
              E.

            	
              HVAC
                Service Contract:
                If Tenant is responsible to maintain the HVAC system, Tenant £
                is
                T
                is
                not required to maintain, at its expense, a regularly scheduled
                maintenance and service contract for the HVAC system. The maintenance
                and
                service contract must be purchased from a HVAC maintenance company
                that
                regularly provides such contracts to similar properties. If Tenant
                fails
                to maintain a required HVAC maintenance and service contract in effect
                at
                all times during this lease, Landlord may do so and charge Tenant
                the
                expense of such a maintenance and service contract or exercise Landlord’s
                remedies under Paragraph 20.

            
	 	 
	
              F.

            	
              Common
                Areas:
                Landlord will maintain any common areas in the Property in a manner
                as
                Landlord determines to be in the best interest of the Property. Landlord
                will maintain any elevator and signs in the common area. Landlord
                may
                change the access to the leased premises. If a modification to the
                common
                areas is required by law or governmental regulation or order, Landlord
                will modify the item. Tenant has the non-exclusive license to use
                the
                common areas in compliance with Landlord’s rules and restrictions. Tenant
                may not solicit any business in the common areas or interfere with
                any
                other person’s right to use the common areas.

            
	 	 
	
              G.

            	
              Notice
                of Repairs:
                Tenant must promptly notify Landlord of any item that is in need
                of repair
                and that is Landlord’s responsibility to repair. All requests for repairs
                to landlord must be in writing.

            
	 	 
	
              H.

            	
              Failure
                to Repair:
                Landlord must make a repair for which Landlord is responsible within
                a
                reasonable period of time after Tenant provides Landlord written
                notice of
                the needed repair. If Tenant fails to repair or maintain an item
                for which
                Tenant is responsible within 10 days after Landlord provides Tenant
                written notice of the needed repair or maintenance, Landlord may:
                (1)
                repair or maintain the item, without liability for any damage or
                loss to
                Tenant, and Tenant must immediately reimburse Landlord for the cot
                to
                repair or maintain; or (2) exercise Landlord’s remedies under Paragraph
                20.

            


    

     

    
      
        	
                16.

              	
                ALTERATIONS:

              


      

    

     

    
      	
              A.

            	
              Tenant
                may not alter, improve, or add to the Property or the leased premises
                without Landlord’s written consent. Landlord will not unreasonably
                withhold consent for the Tenant to make reasonable alterations,
                modifications, or improvements to the leased premises.

            
	 	 
	
              B.

            	
              Tenant
                may not alter any locks or any security devices on the Property or
                the
                leased premises without Landlord’s consent. If Landlord authorizes the
                changing, addition, or rekeying of any locks or other security devices,
                Tenant must immediately deliver the new keys and access devices to
                Landlord.

            
	 	 
	
              C.

            	
              If
                a governmental order requires alteration or modification to the leased
                premises, the party obligated to maintain and repair the item to
                be
                modified or altered as designated in Paragraph 15 will, at its expense,
                modify or alter the item in compliance with the order.

            
	 	 
	
              D.

            	
              Any
                alterations, improvements, fixtures or additions to the Property
                or leased
                premises installed by either party during the term of this lease
                will
                become Landlord’s property and must be surrendered to Landlord at the time
                this lease ends, except for those fixtures Landlord requires Tenant
                to
                remove under Paragraph 14 or if the parties agree otherwise in
                writing

            


    

    

      
        	
                17.

              	
                LIENS:
                  Tenant may not do anything that will cause the title of the Property
                  or
                  leased premises to be encumbered in any way. If Tenant causes a
                  lien to be
                  filed against the Property or leased premises, Tenant will within
                  20 days
                  after Landlord demands Tenant to take action to remove the lien,
                  pay the
                  lien or take whatever action is necessary to cause the lien to
                  be released
                  of record. Tenant will provide Landlord a copy of any release Tenant
                  obtains pursuant to this paragraph.

              
	 	 
	
                18.

              	
                LIABILITY:
                  To
                  the extent permitted by law, Landlord is NOT responsible to Tenant
                  or
                  Tenant’s employees, patrons, guests, or invittees for any damages,
                  injuries, or losses to person or property caused
                  by:

              


      

    

     

    
      	
              A.

            	
              an
                act, omission, or neglect of: Tenant; Tenant’s agent; Tenant’s guest;
                Tenant’s employees; Tenant’s patrons; Tenant’s invitees; or any other
                tenant on the Property;

            
	 	 
	
              B.

            	
              fire,
                flood, water leaks, ice, snow, hail, winds, explosion, smoke, riot,
                strike, interruption of utilities, theft, burglary, robbery, assault,
                vandalism, other persons, environmental contaminants, or other occurrences
                or casualty losses.

            


    

     

    
      
        	
                19.

              	
                INDEMNITY:
                  Tenant
                  will indemnify and hold Landlord harmless from any property damage,
                  personal injury, suits, actions, liabilities, damages, cost of
                  repairs or
                  service to the leased premises or Property, or any other loss caused,
                  negligently or otherwise, by Tenant or Tenant’s employees, patrons,
                  guests, or invitees.

              


      

       

      
        	
                20.

              	
                DEFAULT:

              


      

    

     

    
      	
              A.

            	
              If
                Landlord fails to comply with this lease within 30 days after Tenant
                notifies Landlord of Landlord’s failure to comply, Landlord will be in
                default and Tenant may seek any remedy provided by law. If, however,
                Landlord’s non-compliance reasonably requires more than 30 days to cure,
                Landlord will not be in default if the cure is commenced within the
                30 day
                period and is diligently pursued.

            


    

    


    
      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      



    Commercial
      Lease concerning: 12060
      FM 3083 Conroe, TX       

    


    
      	
              B.

            	
              If
                Landlord does not actually receive at the place designated for payment
                any
                rent due under this lease within 5 days after it is due, Tenant will
                be in
                default. If Tenant fails to comply with this lease for any other
                reason
                within 10 days after Landlord notifies Tenant of its failure to comply,
                Tenant will be in default.

            
	 	 
	
              C.

            	
              If
                Tenant is in default, Landlord may: (i) terminate Tenant’s right to occupy
                the leased premises by providing Tenant with at least 3 days written
                notice; and (ii) accelerate all rents which are payable during the
                remainder of this lease or any renewal period without notice or demand.
                Landlord will attempt to mitigate any damage or loss caused by Tenant’s
                breach. If Tenant is in default, Tenant will be liable
                for:

            


    

     

    
      	
              (1)

            	
              any
                lost rent;

            
	
              (2)

            	
              Landlord’s
                cost of relating the leased premises, including brokerage fees,
                advertising fees, and other fees necessary to relet the leased
                premises;

            
	
              (3)

            	
              repairs
                to the leased premises for use beyond normal wear and tear,
                

            
	
              (4)

            	
              all
                Landlord’s costs associated with eviction of Tenant, such as attorney’s
                fees, court costs, and prejudgment interest;

            
	
              (5)

            	
              all
                Landlord’s costs associated with collection of rent such as collection
                fees, late charges, and returned check charges;

            
	
              (6)

            	
              cost
                of removing any equipment and trade-fixtures left on the leased premises
                by Tenant;

            
	
              (7)

            	
              cost
                to remove any trash, debris, personal property, hazardous materials,
                or
                environmental contaminants left by Tenant or Tenant’s employees, patrons,
                guests, or invitees in the leased premises or Property;
                and

            
	
              (8)

            	
              any
                other recovery to which Landlord may be entitled by
                law.

            


    

     

    
      
        	
                21.

              	
                ABANDONMENT,
                  INTERRUPTION OF UTILITIES, REMOVAL OF TENANT’S PROPERTY, AND LOCKOUT:
                  Chapter 93 of the Texas Property Code governs the rights and obligations
                  of the parties with regard to: (a) abandonment of the leased premises;
                  (b)
                  interruption of utilities; (c) removal of Tenant’s personal property; and
                  (d) “lock-out” of Tenant.

              
	 	 
	
                22.

              	
                HOLDOVER:
                  If Tenant fails to vacate the leased premises at the time this
                  lease ends,
                  Tenant will become a tenant-at-will and must vacate the leased
                  premises
                  immediately upon receipt of a demand from Landlord. No holding
                  over by
                  Tenant, with or without the consent of Landlord, will extend this
                  lease.
                  Tenant will indemnify Landlord and any prospective tenants for
                  any and all
                  damages caused by the holdover. Rent for any holdover period will
                  be 2
                  times the base monthly rent plus any additional rent calculated
                  on a daily
                  basis and will be immediately due and payable daily without notice
                  or
                  demand.

              
	 	 
	
                23.

              	
                LANDLORD’S
                  LIEN AND SECURITY INTEREST: To secure Tenant’s performance under this
                  lease, Tenant
                  grants to Landlord a lien and security interest against all of
                  Tenant’s
                  nonexempt personal property that is in the leased premises or
                  Property.
                  This lease is a security agreement for the purposes of the Uniform
                  Commercial Code, Landlord may file a copy of this lease as a financing
                  statement.

              
	 	 
	
                24.

              	
                ASSIGNMENT
                  AND SUBLETTING: Tenant may not assign this lease or sublet any
                  part of the
                  leased premises without Landlord’s written consent,. An assignment of this
                  lease or subletting of the leased premises without Landlord’s written
                  consent is voidable by Landlord. If Tenant assigns this lease or
                  sublets
                  any part of the leased premises, Tenant will remain liable for
                  all of
                  Tenant’s obligations under this lease regardless if the assignment or
                  sublease is made with or without the consent of
                  Landlord.

              
	 	 
	
                25.

              	
                RELOCATION:
                  By providing Tenant with not less than 90 days advanced written
                  notice,
                  Landlord may require Tenant to relocate to another location in
                  the
                  Property, provided that the other location is equal in size or
                  larger than
                  the leased premises than occupied by Tenant and contains similar
                  leasehold
                  improvements. Landlord will pay Tenant’s reasonable out-of-pocket moving
                  expenses for moving to the other location. “Moving expenses” means
                  expenses payable to professional movers, utility companies for
                  connection
                  and disconnection fees, wiring companies for connecting and disconnecting
                  Tenant’s office equipment required by the relocation, and printing
                  companies for reprinting Tenant’s stationary and business cards. A
                  relocation of Tenant will not change or affect any other provision
                  of this
                  lease that is then in effect, including rent and reimbursement
                  amounts,
                  except that the inscription of the suite or unit number will automatically
                  be amended.

              
	 	 
	
                26.

              	
                SUBORDINATION:

              


      

    

     

    
      
        	
                A.

              	
                This
                  lease and Tenant’s leasehold interest are and will be subject,
                  subordinate, and inferior to:

              


      

    

     

    
      	
              (1)

            	
              any
                lien, encumbrance, or ground lease now or hereafter placed on the
                leased
                premises or the Property by Landlord;

            
	
              (2)

            	
              all
                advances made under any such lien, encumbrance, or ground
                lease;

            
	
              (3)

            	
              the
                interest payable on any such lien or encumbrance;

            
	
              (4)

            	
              any
                and all renewals and extensions of any such lien, encumbrance, or
                ground
                lease;

            
	
              (5)

            	
              any
                restrictive covenant affecting the leased premises or the Property;
                and

            
	
              (6)

            	
              the
                rights of any owners’ association affecting the leased premises or
                Property.

            


    

     

    
      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

    

    


    Commercial
      Lease concerning: 12060
      FM 3083 Conroe, TX

    


    
      	
              B.

            	
              Tenant
                must, on demand, execute any instrument subordinating this lease
                as
                Landlord may request, provided that such subordination is made on
                the
                condition that this lease and Tenant’s rights under this lease are
                recognized by the lien-holder.

            


    

     

    
      
        	
                27.

              	
                ESTOPPEL
                  CERTIFICATES: Within 10 days after receipt of a written request
                  from
                  Landlord, Tenant will execute and deliver to Landlord an estoppel
                  certificate that identifies: (a) when this lease commences and
                  ends; (b)
                  any amendments to this lease; (c) any rights that Tenant may have
                  to
                  extend this lease or purchase the Property or leased premises;
                  (d) any
                  default by Landlord; and (e) any other information reasonably requested
                  in
                  the certificate.

              
	 	 
	
                28.

              	
                CASUALTY
                  LOSS:

              


      

    

     

    
      	
              A.

            	
              Tenant
                must immediately notify Landlord of any casualty loss in the leased
                premises. Within 20 days after receipt of Tenant’s notice of casualty
                loss, Landlord will notify Tenant if the leased premises are less
                than or
                more than 50% unusable, on a per square foot basis, and if Landlord
                can
                substantially restore the leased premises within 120 days after Tenant
                notifies Landlord of the casualty loss.

            
	 	 
	
              B.

            	
              If
                the leased premises are less than 50% unusable and Landlord can
                substantially restore the leased premises within 120 days after Tenant
                notifies Landlord of the casualty, Landlord will restore the leased
                premises to substantially the same condition as before the casualty.
                If
                Landlord fails to substantially restore within the time required,
                Tenant
                may terminate this lease.

            
	 	 
	
              C.

            	
              If
                the leased premises are more than 50% unusable and Landlord can
                substantially restore the leased premises within 120 days after Tenant
                notifies Landlord of the casualty, Landlord may: (1) terminate this
                lease;
                or (2) restore the leased premises to substantially the same condition
                as
                before the casualty. If Landlord chooses to restore and does not
                substantially restore the leased premises within the time required,
                Tenant
                may terminate this lease.

            
	 	 
	
              D.

            	
              If
                Landlord notifies Tenant that Landlord cannot substantially restore
                the
                leased premises within 120 days after Tenant notifies Landlord of
                the
                casualty loss, Landlord may: (1) choose not to restore and terminate
                this
                lease; or (2) choose to restore, notify Tenant of the estimated time
                to
                restore, and give Tenant the option to terminate this lease by notifying
                Landlord within 10 days.

            
	 	 
	
              E.

            	
              If
                this lease does not terminate because of a casualty loss, rent will
                be
                reduced from the date Tenant notifies Landlord of the casualty loss
                to the
                date the leased premises are substantially restored by an amount
                proportionate to the extent the leased premises are
                unusable.

            


    

     

    
      
        	
                29.

              	
                CONDEMNATION:
                  If after a condemnation or purchase in lieu of condemnation the
                  leased
                  premises are totally unusable for the purposes stated in this lease,
                  this
                  lease will terminate. If after a condemnation or purchase in lieu
                  of
                  condemnation the leased premises are partially unusable for the
                  purposes
                  stated in this lease, this lease will continue and rent will be
                  reduced in
                  an amount proportionate to the extent the leased premises are unusable.
                  Any condemnation award or proceeds in lieu of condemnation are
                  the
                  property of Landlord and Tenant has no claim to such proceeds or
                  award.
                  Tenant may seek compensation from the condemning authority for
                  the moving
                  expenses and damages to Tenant’s personal property.

              
	 	 
	
                30.

              	
                ATTORNEY’S
                  FEES: Any person who is a prevailing party in any legal proceeding
                  brought
                  under or related to the transaction described in this lease is
                  entitled to
                  recover prejudgment interest, reasonable attorney’s fees, and all other
                  costs of litigation from this nonprevailing party.

              
	 	 
	
                31.

              	
                REPRESENTATIONS:
                  Tenant’s statements in this lease and any application for rental are
                  material representations relied upon by Landlord. Each party signing
                  this
                  lease represents that he or she is of legal age to enter into a
                  binding
                  contract and is authorized to sign the lease. If Tenant makes any
                  misrepresentation in this lease or in any application for rental,
                  Tenant
                  is in default. Landlord is not aware of any material defect on
                  the
                  Property that would affect the health and safety of an ordinary
                  person or
                  any environmental hazard on or effecting the Property that would
                  affect
                  the health or safety of an ordinary person,
                  except:

              


      

    

     

    
      
        	
                32.

              	
                BROKER’S
                  FEES:

              


      

       

    

    
      	
              A.

            	
                           
                N/A                                                                                                                                          
                   (broker
                A) represents

            
	 	
              £
                Landlord

            	
              £
                Tenant. Broker A’s fees will be paid pursuant to (choose 1 or
                2):

            
	 	£ (1)
              a separate written agreement between Broker A and £
              Landlord £
              Tenant £
              Broker ____
	 	
              £
(2)
                the attached Addendum for Broker’s
                Fee.

            


    

     

    
      
        
          
          

        

        
          7

          
            

          

        

        
          
          

        

      

    

    


    Commercial
      Lease concerning: 12060
      FM 3083 Conroe, TX

    

      
        	
                B.

              	
                 
                  __________________________________________________________________(Broker
                  B) represents

              


      

      
        	
                £

              	
                Landlord

              	
                £
                  Tenant. Broker B’s fees will be paid pursuant to (choose 1 or
                  2):

              
	 	 	 	 	 
	
                £

              	
                (1)
                  a separate written agreement between Broker B and 

              	
                £
                  Landlord 

              	
                £
                  Tenant 

              	
                £
                  Broker ____

              
	 	 	 	 	 
	£	
                
                  (2)
                    the attached Addendum for Broker’s Fee.

                

              	
              	 	 


      

       

    

    
      	
              C.

            	
              
                 
                  __________________________________________________________________(Broker
                  C) represents

              

            


    

    
      	 	
              £
                Landlord

            	
              £
                Tenant. Broker C’s fees will be paid pursuant to (choose 1 or
                2):

            
	 	 	 
	 	£
(1)
              a separate written agreement between Broker C and    
              £
              Landlord         £
              Tenant                        
              £
              Broker ____
	 	£
(2)
              the attached Addendum for Broker’s
              Fee.


    

     

    
      
        	
                33.

              	
                ADDENDA:
                  Incorporated into this lease are the addenda, exhibits and other
                  information marked in the Addenda and Exhibit section of the Table
                  of
                  Contents. If Landlord’s Rules and Regulations are made part of this lease,
                  Tenant agrees to comply with the Rules and Regulations as Landlord
                  may, at
                  its discretion, amend from time to
                  time.

              


      

    

     

    
      	
              A.

            	
              Entire
                Agreement:
                This lease contains the entire agreement between Landlord and Tenant
                and
                may not be changed except by written agreement.

            
	
              B.

            	
              Binding
                Effect:
                This lease is binding upon and inures to the benefit of the parties
                and
                their respective heirs, executors, administration, successors, and
                permitted designs.

            
	
              C.

            	
              Joint
                and Several:
                All Tenants are jointly and severally liable for all provisions of
                this
                lease. Any act or notice to, or refund to, or signature of, any one
                or
                more of the Tenants regarding any term of this lease, its renewal,
                or its
                termination is binding on all Tenants.

            
	
              D.

            	
              Controlling
                Law:
                The laws of the State of Texas govern the interpretation, performance,
                and
                enforcement of this lease.

            
	
              E.

            	
              Several
                Clauses:
                If any clause in this lease is found invalid or unenforceable by
                a court
                of law, the remainder of this lease will not be affected and all
                other
                provisions of this lease will remain valid and
                enforceable.

            
	
              F.

            	
              Waiver:
                Landlord’s delay, waiver, or non-enforcement of acceleration, contractual
                or statutory lien, rental due date, or any other right will not be
                deemed
                a waiver of any other or subsequent branch by Tenant or any other
                term in
                this lease.

            
	
              G.

            	
              Quiet
                Enjoyment:
                Provided that Tenant is not in default of this lease, Landlord covenants
                that Tenant will enjoy possession and use of the leased premises
                free from
                serious interference.

            
	
              H.

            	
              Force
                Majeure:
                If Landlord’s performance of a term in this lease is delayed by strike,
                lock-out, shortage of material, governmental restriction, riot, flood,
                or
                any cause outside Landlord’s control, the time for Landlord’s performance
                will be abated until after the
                delay.

            


    

     

    
      
        	
                35.

              	
                NOTICES:
                  All notices under this lease must be in writing and are effective
                  when
                  hand-delivered, sent by mail, or sent by facsimile transmission
                  to:

              


      

    

     

    
      	
              Tenant

            	 	
              Landlord

            
	
              at
                the address of the leased premises.

            	 	
              at
                11449
                Outpost Cove

            
	 	 	
              Willis,
                Tx. 77318

            
	 	 	
              Fax:
                (936)
                756-1755

            
	
              with
                a copy to:

            	 	
              with
                a copy to:

            
	
              at

            	 	
              at

            
	 	 	 
	
              Fax:

            	 	
              Fax:

            


    

    

      
        	
                36.

              	
                SPECIAL
                  PROVISIONS: Upon completion of the 60 month lease, Tenant may have
                  the
                  option to purchase the property & building at fair market value or an
                  agreeable purchase price between owner & Tenant. Tenant must give the
                  owner an advance notice of 180 days if tenant wishes to purchase
                  or
                  continue the lease at that
                  time.

              


      

    

     

    Real
      estate brokers are not qualified to tender legal advice, property inspections,
      surveys, engineering studies (e.g. studies of the structures, drainage, and
      soil
      conditions), environmental assessments, tax advice, financial advice, or
      inspections to determine compliance with zoning, governmental regulations,
      or
      any law (e.g., ADA, Texas Architectural Barriers Statute, etc.). The parties
      should seek experts to render such services. Selection of such experts is the
      responsibility of the parties and not the real estate broker. The terms of
      this
      lease are negotiable among the parties. This is intended to be a legal agreement
      binding upon final acceptance. READ IT CAREFULLY. If you do not understand
      the
      effect of this lease, consult your attorney BEFORE signing.

    


    
      	
              /s/ Paul
                E. Vick Shugalich

            	
              4-8-04

            	 	
              /s/
                Larry S. Shumate

            	
              4/8/04

            
	Landlord   	
              Date

            	 	
              Tenant

            	
              Date

            
	
                                             
                

            	
               

            	 	
               

            	
            
	
              By

            	 	 	 	 
	
              ss

            	
              for
                Landlord

            	 	
              Tenant

            	
              Date

            


    

    
8