<PAGE>
 
                                                                   EXHIBIT 10.47


Recording requested by
and when recorded mail to:

Latham & Watkins                            [NOTARY STAMP APPEARS HERE]
633 W. 5th Street, Suite 4000
Los Angeles, CA 90071-2007
Attn:  Lindsey C. Kozberg, Esq.




--------------------------------------------------------------------------------
                     (Space above line for recorder's use)


                                DEED OF TRUST,

                    ASSIGNMENT OF RENTS, SECURITY AGREEMENT

                               AND FIXTURE FILING



                          THIS DEED OF TRUST SECURES

                A SENIOR SECURED PARTICIPATING PROMISSORY NOTE



          THIS FIRST DEED OF TRUST, ASSIGNMENT OF RENTS, SECURITY ASSIGNMENT
AND FIXTURE FILING ("Deed of Trust"), is made and entered into as of the 18th
                    --------------                                         
day of August, 1998, by and among The Badlands Golf Club Inc., a Nevada
corporation (the "Trustor"), whose principal place of business is 6303 Waterford
                  -------
Blvd., Suite 225, Oklahoma City, Oklahoma 73118, First American Title Company of
Nevada (the "Trustee"), whose principal place of business is 3760 Pecos McLeod
             -------
Interconnect, Suite #7, Las Vegas, Nevada 89121-4253, and National Golf
Operating Partnership, L.P., a Delaware limited partnership (the "Beneficiary"),
                                                                  ----------- 
whose principal place of business is 2951 28th Street, Santa Monica, CA 90405.

          Terms not otherwise defined herein are defined in Exhibit B hereto.

          TRUSTOR HEREBY GRANTS, TRANSFERS, CONVEYS AND ASSIGNS TO TRUSTEE, IN
TRUST, WITH POWER OF SALE, for the benefit and security of the Beneficiary,
under and subject to the terms and conditions hereinafter set forth;
<PAGE>
 
                              GRANTING CLAUSE ONE

                                    (Land)


          The right, title and interest of Trustor under that certain Ground
Lease made and entered into on April 28, 1993, by and between the William
Peccole 1982 Trust, a Nevada trust, and William Peter and Wanda Ruth Peccole
Family Ltd. Partnership, a Nevada limited partnership and Senior Tour Players,
Inc., a Massachusetts corporation, as amended and assigned, and that certain
Ground Lease made and entered into on June 4, 1996, by and between William Peter
and Wanda Lamb Peccole Family Limited Partnership, a Nevada limited
partnership, the Peccole 1982 Trust, William Peter Peccole and Wanda Lamb
Peccole 1971 Trust, William and Wanda Peccole 1991 Trust, Lisa Peccole Miller
1976 Trust, Laurie Peccole Bayne 1976 Trust, Leanne Peccole Goorjian 1976 Trust,
each a Nevada trust, and Senior Tour Players Development Inc., a Nevada
corporation, as assigned (together, the "Ground Leases"), and any other right,
                                         -------------                      
title and interest of Borrower in real property in the City of Las Vegas, County
of Clark, State of Nevada, described in Exhibit A attached hereto and by this
reference incorporated herein (the "Land").
                                    ----


                              GRANTING CLAUSE TWO

                                (Improvements)

          TOGETHER WITH, any and all buildings and improvements now or hereafter
erected on the Land, including, but not limited to, the fixtures, attachments,
appliances, equipment, machinery, and other articles attached to said buildings
and improvements, but specifically excluding personality of tenants of the
Property (the "Improvements") (the Land and Improvements are referred to
               ------------                                            
collectively as the "Property").
                     --------

          For purposes of this Deed of Trust, fixtures shall be deemed to
include, to the fullest extent allowed by law (but specifically excluding the
property of tenants of the Property), all equipment and machinery now or at any
time hereafter located or included in or on or appurtenant to the Property and
used in connection therewith and which are or become so related to the real
property encumbered hereby that an interest arises in them under real estate law
including, but not limited to: all machinery, equipment (including without
limitation pipes, furnaces, conveyors, drums, fire sprinklers and alarm-systems,
and air conditioning, heating, refrigerating, electronic monitoring, food
storage, food processing, trash and garbage removal and maintenance equipment),
office equipment, all built-in tables, chairs, planters, desks, sofas, shelves,
lockers and cabinets, all safes, furnishings, appliances (including without
limitation iceboxes, refrigerators, fans, heaters, water heaters and
incinerators), rugs, carpets and other floor coverings, draperies and drapery
rods and brackets, awnings, window shades, venetian blinds, curtains, lamps,
chandeliers and other lighting fixtures.

                                       2
<PAGE>
 
                             GRANTING CLAUSE THREE

                                    (Rents)

          TOGETHER WITH, all rents, issues, profits, royalties, income and other
benefits derived from the Property (collectively the "Rents"), subject to the
                                                      -----
right, power and authority hereinafter given to Trustor to collect and apply
such rents.

                              GRANTING CLAUSE FOUR

                     (Leases, Deposits and Advance Rentals)

          TOGETHER WITH, all leasehold estate, right, title and interest of
Trustor in and to all leases or subleases covering the Property or any portion
thereof now or hereafter existing or entered into, and all right, title and
interest of Trustor thereunder, including, without limitation, all cash or
security deposits, advance rentals, and deposits or payments of similar nature.

                             GRANTING CLAUSE FIVE

                             (Options to Purchase)

          TOGETHER WITH, all right, title and interest of Trustor in and to all
options, rights of first refusal or similar rights to purchase or lease the
Property or any portion thereof or interest therein, and any greater estate in
the Property owned or hereafter acquired by Trustor.

                              GRANTING CLAUSE SIX

                          (All Additional Interests)

          TOGETHER WITH, all interests, estates or other claims, both in law and
in equity, which Trustor now has or may hereafter acquire in the Property.

                             GRANTING CLAUSE SEVEN

                                  (Easements)

          TOGETHER WITH, all easements, rights-of-way and rights used in
connection therewith or as a means of access thereto or which are otherwise of
benefit thereto to the users thereof, and all tenements, hereditaments and
appurtenances thereof and thereto.

                             GRANTING CLAUSE EIGHT

                                (Right-of-Way)

          TOGETHER WITH, all right, title and interest of Trustor, now owned or
hereafter acquired, in and to any land lying within the right-of-way of any
street, open or proposed, adjoining the Property, and any and all sidewalks,
alleys and strips and gores of land adjacent to or used in connection with the
Property. 

                                       3
<PAGE>
 
                             GRANTING CLAUSE NINE

                              (Personal Property)

          TOGETHER WITH, all right, title and interest of Trustor in and to all
tangible personal property (the "Personal Property") owned or leased by Trustor
                                 -----------------                            
and now or at any time hereafter located on or at the Property or used in
connection therewith, including, but not limited to: all goods, machinery,
tools, insurance proceeds, equipment (including without limitation electric golf
carts, maintenance equipment, fire sprinklers and alarm systems, air
conditioning, heating, refrigerating, electronic monitoring, entertainment,
recreational, window or structural cleaning rigs, maintenance, exclusion of
vermin or insects, removal of dust, refuse or garbage and all other equipment
of every kind), lobby and all other indoor and outdoor furniture (including
without limitation tables, chairs, planters, desks, sofas, shelves, lockers and
cabinets), wall beds, wall safes, furnishings, appliances (including without
limitation ice boxes, refrigerators, fans, heaters, stoves, water heaters and
incinerators), rugs, carpets and other floor coverings, draperies and drapery
rods and brackets, awnings, window shades, venetian blinds, curtains/lamps,
chandeliers and other lighting fixtures and office maintenance and other
supplies, and any and all materials, equipment and other items of personal
property which are stored or otherwise placed on the Land or at other locations
and are intended to be incorporated into the Improvements located or to be
located on the Land.

                              GRANTING CLAUSE TEN

                             (Condemnation Awards)

          TOGETHER WITH, all the estate, interest, right, title, other claim or
demand, which Trustor now has or may hereafter acquire in any and all awards
made for the taking by eminent domain, or by any proceeding or purchase in lieu
thereof, of the whole or any part of the Trust Estate (as defined below),
including without limitation any awards resulting from a change of grade of
streets and awards for severance damages.

                            GRANTING CLAUSE ELEVEN

                             (Insurance Proceeds)

          TOGETHER WITH, all the estate, interest, right, title and other
claim or demand which Trustor now has or may hereafter acquire against anyone
with respect to any damage to all or any part of the Trust Estate, including
without limitation, damage arising from any defect in or with respect to the
design or construction of all or any part of the Improvements and damage
resulting therefrom.

                            GRANTING CLAUSE TWELVE

                             (Claims for Damages)

          TOGETHER WITH, all the estate, interest, right, title and other claim
or demand which Trustor now has or may hereafter acquire against anyone with
respect to any damage to all

                                       4
<PAGE>
 
or any part of the Trust Estate, including without limitation, damage arising
from any defect in or with respect to the design or construction of all or any
part of the Improvements and damage resulting therefrom.

                           GRANTING CLAUSE THIRTEEN

                                (Water Rights)

          TOGETHER WITH, all water rights and privileges pertaining to the use
and enjoyment of the Property, or otherwise appurtenant to the Land, including,
without limitation, the water rights of Trustor under the following Certificates
of Appropriation of Water issued by the State of Nevada (collectively, the
"Certificates"): Permit 51889, Certificate 12107; Permit 29277, Certificate
 ------------                                                            
10490, Permit 47546, Certificate 12106; and Permit 12065, Certificate 4979
(including any applications, deeds or other filings with the State Engineer of
the State of Nevada any and all rights derived therefrom); all right title and
interest in Mortgagor in and to that certain Conditional Water Commitment
Agreement dated April 4, 1995, by and between Mortgagor and the Las Vegas Valley
Water District (the "Commitment Agreement"); all right, title and interest of
                     --------------------                                  
Mortgagor in and to that certain Purchase Agreement dated March 24, 1994, by and
between The William Peccole 1971 Trust, The William Peter and Wanda Ruth Peccole
Family Limited Partnership and Senior Tour Players, Inc. (the "Purchase
                                                               --------
Agreement"); all rents, revenues, income, issues, profits, other payments,
---------                                                               
security deposits and other benefits to which Mortgagor may now or hereafter be
entitled in connection with the Water Rights; and all proceeds, judgments,
claims, compensation, awards of damages and settlements with respect to or
hereafter made as a result of or in lieu of any condemnation or taking of the
Land or the Water Rights by eminent domain, all refunds with respect to the
payment of taxes and assessments, and all other proceeds of the conversion,
voluntary or involuntary, of the Land or the Water Rights, or any part thereof,
into cash or liquidated claims.

          The water rights pertaining to the Land, including, without
limitation, those described in the Certificates, the Commitment Agreement and
the Purchase Agreement are herein sometimes referred to as the "Water Rights."

                           GRANTING CLAUSE FOURTEEN

          (Deposits and Advance Payments of Insurance and Utilities)

          TOGETHER WITH, all deposits or other security or advance payments
including without limitation rental payments made by or on behalf of Trustor to
others with respect to (i) insurance policies relating to all or any part of the
Trust Estate (ii) utility service for all or any part of the Trust Estate.,
(iii) cleaning, maintenance, repair, or similar services for all or any part of
the Trust Estate (iv) refuse removal or sewer service for all or any part of the
Trust Estate, (v) rental of equipment, if any, used in the operation by or on
behalf of Trustor of all or any part of the Trust Estate, and (vi) parking or
similar services or rights afforded to all or any part of the Trust Estate.

          The entire estate, property and interest hereby, conveyed to Trustee
may hereafter be referred to as the "Trust Estate."
                                     ------------ 

                                       5
<PAGE>
 
                         FOR THE PURPOSE OF SECURING:

          a. Payment of indebtedness in the total principal amount of
$22,648,535.49, plus principal in an amount up to $315,000 representing the
Capital Improvement Advance made concurrently herewith or after the date hereof,
evidenced by that certain Secured Participating Promissory Note of even date
herewith (the "Note"), with a maturity date which is 15 years after the date
               ----
hereof, which has been delivered to and is payable to the order of Beneficiary,
and which by this reference is hereby made a part hereof, and any and all
modifications, extensions and renewals thereof.

          b. Payment of the Annual Base Interest, the Additional Interest and
Appreciation Participation (as each such term is defined in the Note).

          c. Payment of all sums advanced by the Beneficiary pursuant to this
Deed of Trust to protect the Trust Estate, with interest thereon at the Overdue
Rate (as defined).

          d. Payment of the other sums, with interest thereon, which may
hereafter be loaned to Trustor, or its successors or assigns, by the Beneficiary
when evidenced by a promissory note or notes reciting that they are secured by
this Deed of Trust.

          e. Payment and performance of all other obligations under this Deed of
Trust, the Loan Agreement, the Note or any other Loan Instrument.

          This Deed of Trust, the Note, the Loan Agreement, any guarantee
thereof and any other instrument given to evidence or further secure the
payment and performance of any obligation secured hereby may hereafter be
referred to as the "Loan Instruments." Capitalized terms used herein have the
                    ----------------
meanings ascribed to such terms in Exhibit B hereto.

          TO PROTECT THE SECURITY OF THIS DEED OF TRUST, TRUSTOR HEREBY
COVENANTS AND AGREES AS FOLLOWS:

                                  ARTICLE I.

                      COVENANTS AND AGREEMENTS OF TRUSTOR
                      
          Trustor hereby covenants and agrees:

          1.1. Payment of Secured Obligations. To pay when due (i) the principal
               ------------------------------                                   
of, and the interest on, the indebtedness evidenced by the Note, (ii) the
Appreciation Participation under the Note, (iii) charges, fees and all other
sums as provided in the Loan Instruments and (iv) the principal of, and interest
on, any future advances secured by this Deed of Trust.

          1.2. Maintenance, Repair, Alterations. To keep or cause to be kept the
               -------------------------------
Trust Estate in good order, repair and appearance, and, except as otherwise
provided in Section 1.4, with reasonable promptness, make or cause to be made
            -----------                                                      
all necessary and appropriate repairs thereto of every kind and nature, whether
interior or exterior, structural or non-structural, ordinary or extraordinary,
foreseen or unforeseen or arising by reason of a condition existing

                                       6
<PAGE>
 
prior to the commencement of this Deed of Trust (concealed or otherwise).
Trustor shall maintain or cause to be maintained the Trust Estate in accordance
with industry standards. Trustor will not take or omit to take, or permit to be
taken or omitted to take, any action the taking or omission of which could
reasonably be expected to impair the value or the usefulness of the Property
or any part thereof for its Primary Intended Use. Nothing herein shall obligate
Trustor to make any capital improvements or replacements to the Property if the
Property can be repaired to the standard required by this Section 1.2, except as
may be required pursuant to the Loan Agreement.

     1.3. Insurance.
          --------- 

          1.3.1.  General Insurance Requirements. To at all times keep, or cause
                  ------------------------------                                
to be kept, the Trust Estate insured with the kinds and amounts of insurance
described below. This insurance shall be written by companies authorized to do
insurance business in the State of Nevada. The policies must name Beneficiary as
an additional insured by way of a standard form of mortgagee's loss payable
endorsement. Losses shall be payable to Beneficiary and/or Trustor (and/or
Trustor's designee) as provided in Section 1.4. Any loss adjustment shall
                                   -----------                           
require the written consent of Beneficiary and Trustor (and/or Trustor's
designee). Trustor shall furnish Beneficiary with original certificates of
insurance. At least thirty (30) days prior to the expiration of each such
policy, Trustor shall furnish Beneficiary with evidence satisfactory to
Beneficiary of the payment of premium and the reissuance of a policy continuing
insurance in force as required by this Deed of Trust. The policies on the Trust
Estate shall insure against the following risks:

          (a) All Risk. Loss or damage by all risks perils including, but not
              --------                                                       
limited to, fire, vandalism, malicious mischief and extended coverages including
but not limited to sprinkler leakage in an amount not less than 100% of the
then Full Replacement Cost thereof.

          (b) Liability. Claims for personal injury or property damage under a
              ---------                                                       
policy of comprehensive general public liability insurance with amounts not less
than $10,000,000 per occurrence and in the aggregate.

          (c) Flood. Flood (when the Property is located in whole or in material
part in a designated flood plain area) and such other hazards and in such
amounts as may be customary for comparable properties in the area; provided
however, that Trustor shall not be required to participate in the National Flood
Insurance Program.

          (d) Worker's Compensation. Adequate worker's compensation insurance
              ---------------------                                           
coverage for all Persons employed by or on behalf of Trustor on the Property in
accordance with the requirements of applicable federal, state and local laws. 

          (e) Other Insurance. Such other insurance on or in connection with any
              ---------------                                                   
of the Property as Beneficiary may reasonably require, which at the time is
usual and commonly obtained in connection with properties similar in type of
building size and use to the Property and located in the geographic area where
the Property is located; provided however, that Beneficiary shall bear the cost
of any such coverage requested under this subsection (e).

                                       7
<PAGE>
 
          1.3.2.  Replacement Cost. In the event either party believes that the
                  ----------------                                             
Full Replacement Cost of the insured property has increased or decreased at any
time, it shall have the right to have such Full Replacement Cost redetermined by
the fire insurance company which is then carrying the largest amount of fire
insurance carried on the Property (the "Impartial Appraiser"). The party
                                        -------------------
desiring to have the Full Replacement Cost so redetermined shall forthwith, on
receipt of such determination by such Impartial Appraiser, give written notice
thereof to the other party hereto. The determination of such Impartial Appraiser
shall be final and binding on Trustor and Beneficiary, and Trustor shall
forthwith increase, or may decrease, the amount of the insurance carried
pursuant to this Section 1.3.2, as the case may be, to the amount so determined
                 -------------                                                 
by the Impartial Appraiser. Each party shall pay one-half of the fee, if any, of
the Impartial Appraiser.

          1.3.3.  Waiver of Subrogation. All insurance policies covering the
                  --------- -----------                                     
Property including contents, fire and casualty insurance, shall expressly waive
any right of subrogation on the part of the insurer against Trustor, Beneficiary
and Lessee. Trustor agrees that the policies will include such waiver clause or
endorsement so long as the same are obtainable without extra cost.

          1.3.4.  Form Satisfactory, Etc., All of the policies of insurance
                  -----------------------                                  
referred to in Section 1.3.1 shall be written in a form reasonably satisfactory
               -------------                                                   
to Beneficiary and by insurance companies rated not less than XV by A.M. Best's
Insurance Guide. Trustor shall pay or shall cause to be paid all premiums for
the policies of insurance referred to in Section 1.3.1 and shall deliver
                                         -------------                  
certificates thereof to Beneficiary prior to their effective date (and with
respect to any renewal policy, at least 10 days prior to the expiration of the
existing policy). En the event Trustor fails to satisfy its obligations under
this Section 1.3, Beneficiary shall be entitled, but shall have no obligation,
to effect such insurance and pay the premiums therefor, which premiums shall be
repayable to Beneficiary upon written demand as Additional Charges. Each insurer
mentioned in Section 1.3.1 shall agree, by endorsement on the policy or policies
             -------------                                                      
issued by it, or by independent instrument furnished to Beneficiary, that it
will give to Beneficiary 30 days' written notice before the policy or policies
in question shall be altered, allowed to expire or canceled. Each such policy
shall also provide that any loss otherwise payable thereunder shall be payable
notwithstanding (i) any act or omission of Trustor or Lessee which might, absent
such provision, result in a forfeiture of all or a part of such insurance
payment, (ii) the occupation or use of the Property for purposes more hazardous
than those permitted by the provisions of such policy, (iii) any foreclosure or
other action or proceeding taken by Beneficiary pursuant to the Loan Instruments
or (iv) any change in title to or ownership of the Property.

          1.3.5.  Change in Limits. In the event that Beneficiary shall at any
                  ----------------                                            
time reasonably determine on the basis of prudent industry practice that the
liability insurance carried by Trustor pursuant to Section 1.3.1(b) is either
                                                   ----------------          
excessive or insufficient, Beneficiary and Trustor shall endeavor to agree on
the proper and reasonable limits for such insurance to be carried; and such
insurance shall thereafter be carried with the limits thus agreed on until
further changed pursuant to the provisions of this Section 1.3.5; provided,
                                                   -------------- --------
however, that the deductibles for such insurance or the amount of such
-------
insurance which is self retained by Trustor (or Lessee) shall be as reasonably
determined by Trustor (or Lessee) so long as Trustor (or Lessee) can reasonably
demonstrate its ability to satisfy such deductible or amount of such self-
retained insurance.

                                       8
<PAGE>
 
          1.3.6. Blanket Policy. Notwithstanding anything to the contrary
                 --------------                                          
contained in this Section 1.3, Trustor's obligations to carry the insurance
                  -----------                                             
provided for herein may be brought within the coverage of a so-called blanket
policy or policies of insurance carried and maintained by or on behalf of
Trustor; provided, however, that the coverage afforded Beneficiary will not be
         --------  -------
reduced or diminished or otherwise be different from that which would exist
under a separate policy meeting all other requirements of this Deed of Trust by
reason of the use of such blanket policy of insurance, and provided further that
the requirements of this Section 1.3 are otherwise satisfied. The amount of the
                         -----------                                          
total insurance allocated to the Property, which amount shall be not less than
the amounts required pursuant to Section 1.3.1, shall be specified either (i)
                                 -------------
in each such "blanket" or umbrella policy or (ii) in a written statement, which
Trustor shall deliver, or cause to be delivered, to Beneficiary, from the
insurer thereunder. A certificate of each such "blanket" or umbrella policy
shall promptly be delivered to Beneficiary.

          1.3.7. Failure to Maintain Insurance. In the event Trustor fails to
                 -----------------------------                               
provide, maintain, keep in force or deliver and furnish to Beneficiary the
policies of insurance required by this Section 1.3, Beneficiary may procure 
                                       -----------
such insurance or single-interest insurance for such risks covering
Beneficiary's interest, and Trustor shall pay all premiums thereon promptly upon
demand by Beneficiary, and until such payment is made by Trustor the amount of
all such premiums together with interest thereon at the Overdue Rate shall be
secured by this Deed of Trust. At any time following the occurrence of an Event
of Default by Trustor hereunder and at the request of Beneficiary, Trustor shall
deposit with Beneficiary in monthly installments an amount equal to one-twelfth
(1/12) of the aggregate annual insurance premiums on all policies of insurance
required by this Deed of Trust as reasonably estimated by Beneficiary. Trustor
further agrees, at any time following the occurrence of an event of default by
Trustor hereunder and upon Beneficiary's request, to cause all bills, statements
or other documents relating to the foregoing insurance premiums to be sent or
mailed directly to Beneficiary. Upon receipt of such bills, statements or other
documents' and providing Trustor has deposited sufficient funds with Beneficiary
pursuant to this Section 1.3.7, Beneficiary shall pay such amounts as may be due
                 -------------
thereunder out of the funds so deposited with Beneficiary. If at any time and
for any reason the funds deposited with Beneficiary are or will be insufficient
to pay such amounts as may then or subsequently be due, Beneficiary shall notify
Trustor and Trustor shall immediately deposit an amount equal to such deficiency
with Beneficiary. Notwithstanding the foregoing, nothing contained herein shall
cause Beneficiary to be deemed a trustee of said funds or to be obligated to pay
any amounts in excess of the amount of funds deposited with Beneficiary pursuant
to this Section 1.3.7. Beneficiary may not commingle said reserve with its own 
        --------------
funds and Trustor shall be entitled to any interest earned thereon.

     1.4. Application of Insurance Proceeds.
          ---------------------------------

          l.4.1. Insurance Proceeds. All proceeds of insurance payable by reason
                 ------------------
of any loss or damage to the Property or any portion thereof, and insured under
any policy of insurance required by Section 1.3 shall (i) if greater than
                                    -----------
$500,000, be paid to Beneficiary and held by Beneficiary and (ii) if less than
such amount, be paid to Trustor or its designee and held by Trustor or such
designee. All such proceeds shall be held in trust and shall be made available
for reconstruction or repair, as the case may be, of any damage to or
destruction of the Property, or any portion thereof.

                                       9
<PAGE>
 
          1.4.2.  Disbursement of Proceeds. Any proceeds held by Beneficiary or
                  ------------------------
Trustor shall be paid out by Beneficiary or Trustor (or its designee) from time
to time for the reasonable costs of such reconstruction or repair; provided,
                                                                   -------- 
however, that Beneficiary shall disburse proceeds subject to the following
-------
requirements:

                       (i)     prior to commencement of restoration, (A) the
                               architects, contracts, contractors, plans and
                               specifications for the restoration shall have
                               been approved by Beneficiary, which approval
                               shall not be unreasonably withheld or delayed
                               and (B) appropriate waivers of mechanics' and
                               materialmen's liens shall have been filed;
                               
                       (ii)    at the time of any disbursement, subject to
                               Article II, no mechanics' or materialmen's liens
                               shall have been filed against any of the Property
                               and remain undischarged, unless a satisfactory
                               bond shall have been posted in accordance with
                               the laws of the State of Nevada;
                               
                       (iii)   disbursements shall be made from time to time
                               in an amount not exceeding the cost of the work
                               completed since the last disbursement, upon
                               receipt of (A) satisfactory evidence, of the
                               stage of completion, the estimated total cost of
                               completion and performance of the work to date in
                               a good and workmanlike manner in accordance with
                               the contracts, plans and specifications, (B)
                               waivers of liens, (C) a satisfactory bringdown of
                               title insurance and (D) other evidence of cost
                               and payment so that Beneficiary can verify that
                               the amounts disbursed from time to time are
                               represented by work that is completed, in place
                               and free and clear of mechanics' and
                               materialmen's lien claims;

                       (iv)    each request for disbursement shall be
                               accompanied by a certificate of Trustor (or
                               Trustor's designee), signed by the president or a
                               vice president of Trustor (or Trustor's
                               designee), describing the work for which payment
                               is requested, stating the cost incurred in
                               connection therewith, stating that Trustor (or
                               Trustor's designee) has not previously received
                               payment for such work and, upon completion of the
                               work, also stating that the work has been fully
                               completed and complies with the applicable
                               requirements of this Deed of Trust;

                                       10
<PAGE>
 
 
                        (v)    to the extent actually held by Beneficiary, (1)
                               the proceeds shall be held in a separate account
                               and shall not be commingled with Beneficiary's
                               other funds, and (2) interest shall accrue on
                               funds so held at the money market rate of
                               interest and such interest shall constitute part
                               of the proceeds;
                               
                        (vi)   such other reasonable conditions as Beneficiary
                               may impose; and
                               
                        (vii)  any excess proceeds of insurance remaining
                               after the completion of the restoration or
                               reconstruction of the Property (or in the event
                               Trustor is not required to restore or
                               reconstruct) shall be paid to Trustor. All
                               salvage resulting from any risk covered by
                               insurance shall belong to Trustor.

          1.4.3. Reconstruction Covered by Insurance.
                 ----------------------------------- 

          (a) Destruction Rendering Facility Unsuitable for its Primary Use. If
              -------------------------------------------------------------    
the Property is totally or partially destroyed from a risk covered by the
insurance described in Section 1.3, and the Facility thereby is rendered
                       -----------                                     
Unsuitable For Its Primary Intended Use, Trustor shall, at its election, either
(A) diligently restore or cause the restoration of the Facility to substantially
the same condition as existed immediately before the damage or destruction.

          (b) Destruction Not Rendering Facility Unsuitable for its Primary Use.
              -----------------------------------------------------------------
If, the Property is totally or partially destroyed from a risk covered by the
insurance described in Section 1.3, but the Facility is not thereby rendered
                       -----------
Unsuitable For Its Primary Intended Use, Trustor shall diligently restore or
cause the restoration of the Facility to substantially the same condition as
existed immediately before the damage or destruction; provided however, that
Trustor shall not be required to restore the Personal Property and/or any
Improvements if failure to do so does not adversely affect the amount of
Additional Interest payable under the Note.

          (c) Costs of Repair. If the cost of the repair or restoration exceeds
              ---------------
the amount of proceeds received by Beneficiary or Trustor (or Trustor's
designee) from the insurance required under Section 1.3, Trustor (or Trustor's
                                            -----------
designee) shall pay for such excess cost of repair or restoration.

          1.4.4. Reconstruction Not Covered by Insurance. If the Facility is
                 ---------------------------------------                    
totally or materially destroyed from a risk not covered by the insurance
described in Section 1.3, whether or not such damage or destruction renders the
             ----------
Facility Unsuitable For Its Primary Intended Use, Trustor shall restore or cause
to be restored the Facility to substantially the same condition as existed
immediately before the damage or destruction.

    1.5.  Assignment of Policies upon Foreclosure. In the event of foreclosure 
          ---------------------------------------
of this Deed of Trust or other transfer of title or assignment of the Trust
Estate in extinguishment, in whole or in part, of the debt secured hereby, all
right, title and interest of Trustor in and to all

                                       11
<PAGE>
 
policies of insurance required by this section shall inure to the benefit of and
pass to the successor in interest to Trustor or the purchaser or grantee of the
Trust Estate.

     1.6. Indemnification; Subrogation; Waiver of Offset.
          ---------------------------------------------- 

          (a) If Beneficiary is made a party defendant to any litigation
concerning this Deed of Trust or the Trust Estate or any part thereof or
interest therein, or the occupancy thereof by Trustor, then Trustor shall
indemnify, defend and hold Beneficiary harmless from all liability by reason of
said litigation, including reasonable attorneys' fees and expenses incurred by
Beneficiary in any such litigation, whether or not any such litigation is
prosecuted to judgment; provided however, that this Section 1.6(a) shall not be
                                                    --------------              
applicable to litigation resulting from the active negligence or willful
misconduct of Beneficiary. If Beneficiary commences an action against Trustor to
enforce any of the terms hereof or because of the breach by Trustor of any of
the terms hereof, or for the recovery of any sum secured hereby, Trustor shall
pay to Beneficiary reasonable attorneys' fees and expenses, and the right to
such attorneys' fees and expenses shall be deemed to have accrued on the
commencement of such action and shall be enforceable whether or not such action
is prosecuted to judgment. if Trustor breaches any term of this Deed of Trust,
Beneficiary may employ an attorney or attorneys to protect its rights hereunder,
and in the event of such employment following any breach by Trustor, Trustor
shall pay Beneficiary reasonable attorneys' fees and expenses incurred by
Beneficiary, whether or not an action is actually commenced against Trustor by
reason of breach.

          (b)  Trustor waives and all right to claim or recover against 
Beneficiary, its officers, employees, agents and representatives, for loss or
damage to Trustor, the Trust Estate, Trustor's property or the property of
others under Trustor's control from any cause insured against or required to be
insured against by the provisions of this Deed of Trust.

          (c) All sums payable by Trustor hereunder shall be paid without
notice, demand, counterclaim, setoff, deduction or defense and without
abatement, suspension, deferment, diminution or reduction, and the obligations
and liabilities of Trustor hereunder shall in no way be released, discharged or
otherwise affected (except as expressly herein) by reason of: (i) any damage to
or destruction of or any condemnation or similar taking of the Trust Estate or
any part thereof; (ii) any restriction or prevention of or interference with any
use of the Trust Estate or any part thereof; (iii) any title defect or
encumbrance or any eviction from the Property or the Improvements or any part
thereof by title paramount or otherwise; (iv) any bankruptcy, insolvency,
reorganization, composition, adjustment, dissolution, liquidation or other like
proceeding relating to Beneficiary, or any action taken with respect to this
Deed of Trust by any trustee or receiver of Beneficiary, or by any court, in any
such proceeding; (v) any claim which Trustor has or might have against
Beneficiary; (vi) any Event of Default or failure on the part of Beneficiary to
perform or comply with any of the terms hereof or of any other agreement with
Trustor; or (vii) any other occurrence whatsoever, whether similar or dissimilar
to the foregoing, whether or not Trustor shall have notice or knowledge of any
of the foregoing. Except as expressly provided herein, Trustor waives all rights
now or hereafter conferred by statute or otherwise to any abatement, suspension,
deferment, diminution or reduction of any sum secured hereby and payable by
Trustor.

                                       12
<PAGE>
 
     1.7. Taxes and Impositions.
          ---------------------

          (a) Trustor agrees to pay or cause to be paid, prior to delinquency,
all real property taxes and assessments, general and special, and all other
taxes and assessments of any kind or nature whatsoever, including without
limitation nongovernmental levies or assessments such as maintenance charges,
owner association dues or charges or fees, levies or charges resulting from
covenants, conditions and restrictions affecting the Trust Estate, which are
assessed or imposed upon the Trust Estate, or become due and payable, and which
create, may create or appear to create a lien upon the Trust Estate, or any part
thereof, or upon any Personal Property (all of which taxes, assessments and
other governmental charges of like nature are hereinafter referred to as
"Impositions") provided, however, that if, by law, any such Imposition is
 -----------                                                            
payable, or may at the option of the taxpayer be paid, in installments, Trustor
may pay the same together with any accrued interest on the unpaid balance of
such Imposition in installments as the same become due and before any fine,
penalty, interest or cost may be added thereto for the nonpayment of any such
installment and interest.

          (b) If at any time after the date hereof there shall be assessed or
imposed (i) a tax or assessment on the Trust Estate in lieu of or in addition to
the Impositions payable by Trustor pursuant to subparagraph (a) hereof, or (ii)
a license fee, tax or assessment imposed on Beneficiary, and measured by or
based in whole or in part upon the amount of the outstanding obligations secured
hereby, then all such taxes, assessments or fees shall be deemed to be included
within the term "Impositions" as defined in subparagraph (a) hereof, and Trustor
shall pay and discharge the same as herein provided with respect to the payment
of Impositions. Anything to the contrary herein notwithstanding, Trustor shall
have no obligation to pay any franchise, estate, inheritance, income, excess
profits or similar tax levied on Beneficiary or on the obligations secured
hereby.

          (c) Subject to the provisions of subparagraph (d) of this Section 1.7,
                                                                    -----------
Trustor covenants to promptly furnish Beneficiary official receipts of the
appropriate taxing authority, or other proof satisfactory to Beneficiary,
evidencing the payments thereof, such as canceled checks.

          (d) Trustor shall have the right before any delinquency occurs to
contest or object to the amount or validity of any such Imposition in accordance
with Article II.

          (e) At any time following an Event of Default by Trustor hereunder and
upon the written request of Beneficiary, Trustor shall deposit with Beneficiary
monthly an amount equal to one-twelfth (1/12) of the annual Impositions
reasonably estimated by Beneficiary to pay the installment of taxes next due on
the Trust Estate. In such event Trustor further agrees to cause all bills,
statements or other documents relating to Impositions to be sent or mailed
directly to Beneficiary or such person as Beneficiary shall designate. Upon
receipt of such bills, statements or other documents, and providing Trustor has
deposited sufficient funds with Beneficiary pursuant to this Section 1.7,
                                                             ----------- 
Beneficiary shall pay such amounts as may be due thereunder out of the funds so
deposited with Beneficiary. If at any time and for any reason the funds
deposited with Beneficiary are or will be insufficient to pay such amounts as
may then or subsequently be due, Beneficiary shall notify Trustor and Trustor
shall immediately deposit an

                                       13
<PAGE>
 
amount equal to such deficiency with Beneficiary. Notwithstanding the foregoing,
nothing contained herein shall cause Beneficiary to be deemed a trustee of said
funds or to be obligated to pay any amounts in excess of the amount of funds
deposited with Beneficiary pursuant to this Section 1.7. Beneficiary may not
                                            -----------                    
commingle said reserve with its own funds and Trustor shall be entitled to any
interest earned thereon pending disbursement or application hereunder. To the
extent said reserve is not used to pay said annual Impositions, Beneficiary may
impound or reserve for future payment of Impositions such portion of such
payments as Beneficiary may in its sole and absolute discretion deem proper,
applying the balance, if any, on the principal of or interest on the obligations
secured hereby.

          Should Trustor fail to deposit with Beneficiary (exclusive of that
portion of said payments which has been applied by Beneficiary on the principal
of or interest on the obligations secured hereunder) sums sufficient to fully
pay such Impositions at least 30 days before delinquency thereof, Beneficiary
may, at Beneficiary's election, but without any obligation so to do, advance any
amounts required to make up the deficiency. Said advances, if any, shall be
secured hereby and shall be repayable to Beneficiary as herein elsewhere
provided, or at Beneficiary's option, in its sole and absolute discretion, and
without making any advance whatever, Beneficiary may apply any sums held by it
upon any obligation of the Trustor secured hereby.

          Should any Event of Default occur or exist under the terms of the Loan
Instruments, Beneficiary may, at any time at Beneficiary's option, in its sole
and absolute discretion, apply any sums or amounts in its hands received
pursuant hereto, or as rents or income of the Trust Estate or otherwise, upon
any indebtedness or obligation of the Trustor secured hereby in such manner and
order as Beneficiary may elect. The receipt, use or application of any such sums
paid by Trustor to Beneficiary hereunder shall not be construed to affect the
maturity of any indebtedness secured by this Deed of Trust or any of the rights
or powers of Beneficiary or Trustee under the terms of the Loan Instruments or
any of the obligations of Trustor under this Loan Instrument.

          (f) Trustor covenants and agrees not to suffer, permit or initiate the
joint assessment of the real and personal property, or any other procedure
whereby the lien of the real property taxes and the lien of the personal
property taxes shall be assessed, levied or charged to the Trust Estate as a
single lien.

          (g) If requested by Beneficiary, Trustor shall at its expense cause to
be furnished to Beneficiary a tax reporting service covering the Trust Estate of
the type and duration and with a company satisfactory to Beneficiary.

     1.8. Utilities. To pay or cause to be paid when due all utility
          ---------
charges which are incurred for the benefit of the Trust Estate or which may
become a charge or lien against the Trust Estate for gas, electricity, water or
sewer services furnished to the Trust Estate and all other assessments or
charges of a similar nature, whether public or private, affecting the Trust
Estate or any portion thereof, whether or not such taxes, assessments or
charges are liens thereon.

                                       14
<PAGE>
 
     1.9. Actions Affecting Trust Estate. To appear in and contest any
          ------------------------------                             
action or proceeding purporting to affect the security hereof or the rights or
powers of Beneficiary or Trustee; and to pay all costs and expenses, including
cost of evidence of title and reasonable attorneys' fees, in any such action or
proceeding-in which Beneficiary or Trustee may appear.

     1.10. Actions by Trustee and/or Beneficiary to Preserve Trust Estate.
           -------------------------------------------------------------- 
That should Trustor fail to make any payment or to do any act as and in the
manner provided in any of the Loan Instruments, Beneficiary and/or Trustee, each
in its own discretion, without obligation to do so, but with private notice to
or demand upon Trustor and without releasing Trustor from any obligation, may
make or do the same in such manner and to such extent as either may deem
necessary to protect the security hereof. In connection therewith (without
limiting their general powers), Beneficiary and/or Trustee shall have and are
hereby given the right, but not the obligation, (i) after the occurrence of an
Event of Default, to enter upon and take possession of the Trust Estate; (ii)
after the occurrence of an Event of Default, to make additions, alterations,
repairs and improvements to the Trust Estate which they or either of them may
consider necessary or proper to keep the Trust Estate in good condition and
repair; (iii) to appear and participate in any action or proceeding affecting or
which may affect the security hereof or the rights or powers of Beneficiary or
Trustee; (iv) to pay, purchase, contest or compromise any encumbrance, claim,
charge, lien or debt which in the judgment of either may affect or appears to
affect the security of this Deed of Trust or be prior or superior hereto; and
(v) in exercising such powers, to pay necessary expenses, including employment
of counsel or other necessary or desirable consultants. Trustor shall,
immediately upon demand therefor by Beneficiary, pay all costs and expenses
incurred by Beneficiary in connection with the exercise by Beneficiary of the
foregoing rights, including without limitation costs of evidence of title, court
costs, appraisals, surveys and reasonable attorneys' fees.

     1.11 Ground Leases.
          -------------

          (a) Trustor agrees to perform, or cause to be performed, in a timely
manner, all of Trustor's obligations pursuant to the Ground Leases.

          (b) Trustor agrees to extend, or cause to be extended, to the maximum
number of years permitted thereunder, the term of the Ground Leases, and to
provide evidence of such action to Beneficiary.

          (c) Trustor agrees to enforce all of the agreements and
obligations of the landlords under the Ground Leases.

          (d) Without the prior written consent of Beneficiary, Trustor will not
(i) modify or amend the Ground Leases or any of the terms thereof, (ii) agree
with landlords to terminate the Ground Leases, or (iii) consent to any
termination of the Ground Leases by landlords.

     1.12 Eminent Domain. That should the Trust Estate, or any part thereof
          ---------------                                          
or interest therein, be taken or damaged by reason of Condemnation, or in any
other manner, or

                                       15
<PAGE>
 
should Trustor receive any notice or other information regarding same Trustor
shall give prompt written notice thereof to Beneficiary.

          (a) In the event of a total taking of the Trust Estate, Beneficiary
shall be entitled to all Awards (only to the extent of debt secured by the Note)
and shall be entitled at its option to commence, appear in and prosecute in its
own name any action or proceedings. Subject to Trustor's written approval,
which approval shall not be unreasonably withheld, Beneficiary shall also be
entitled to make any compromise or settlement in connection with such taking or
damage. All such Awards (only to the extent of debt secured by the Note) are
hereby assigned to Beneficiary and Trustor agrees to execute such further
assignments of the Awards as Beneficiary or Trustee may require. Any Award in
excess of the debt secured by the Note shall be given to Trustor.

          (b) In the event of a partial taking of the Trust Estate, Trustor at
its cost shall accomplish all necessary restoration up to but not exceeding the
amount of the Award payable to Trustor. All Awards payable by reason of a
partial taking shall (i) if greater than $500,000, be paid to Beneficiary and
held by Beneficiary and (ii) if less than such amount, be paid to Trustor or its
designee and held by Trustor or such designee. All such proceeds shall be held
in trust and shall be made available for reconstruction or repair, as the case
may be, of any damage to or destruction of the Trust Estate, or any portion
thereof. All awards held by Beneficiary shall be disbursed pursuant to the
provisions of Section 1.4.2 of this Deed of Trust.
              -------------                       

     1.13 Additional Security. That, in the event Beneficiary at any time
          --------------------                                           
holds additional security for any of the obligations secured hereby, it may
enforce the sale therefor otherwise realize upon the same, at its option, either
before or concurrently herewith or after a sale is made hereunder.

     1.14. Appointment of Successor Trustee. That Beneficiary may, from
           --------------------------------                           
time to time, by a written instrument executed and acknowledged by Beneficiary,
mailed to Trustor and recorded in the County in which the Trust Estate is
located and by otherwise complying with the provisions of the applicable law of
the State of Nevada, substitute a successor or successors to the Trustee named
herein or acting hereunder.

     1.15. Successors and Assigns. That this Deed of Trust applies to,
           ----------------------                                     
inures to the benefit of and binds all parties hereto, their heirs, legatees,
devisees, administrators, executors, successors and assigns. The term
"Beneficiary" shall mean the owner and holder of the Note, whether or not named
------------                                                                   
as Beneficiary herein.

     1.16. Inspections. That Beneficiary, or its agents, representatives or
           -----------                                                     
workmen upon 48 hours' written notice to Trustor, are authorized to enter at any
reasonable time upon or in any part of the Trust Estate for the purpose of
inspecting the same and for the purpose of performing any of the acts it is
authorized to perform under the terms of any of the Loan Instruments.
Beneficiary, its agents, representative and/or workmen shall use all reasonable
efforts to minimize any disturbance to Trustor's operations caused by such
entry. During any such entry, Trustor shall have the right to have a
representative accompany Beneficiary, its agents, representatives and/or
workmen. Beneficiary shall indemnify, defend, protect and hold

                                       16
<PAGE>
 
harmless Trustor from all damages, liabilities, claims, judgments, actions,
attorneys' fees, consultants' fees, costs and expenses arising from any entry
upon the Trust Estate pursuant to this Section 1.15.
                                       ------------ 

     1.17. Liens Encumbrances and Other Title Matters.
           ------------------------------------------ 

           1.17.1. Liens. Subject to the provisions of Article II hereof,
                   -----                               ----------        
Trustor will not directly or indirectly create or allow to be created or to
remain, and will promptly discharge, or caused to be discharged at its expense,
any lien, encumbrance, attachment, title retention agreement or claim upon the
Property or any attachment, levy, claim or encumbrance in respect of the Trust
Estate or rents on the Property, not including, however:

           (a) this Deed of Trust;

           (b) the Lease;

           (c) restrictions, liens and other encumbrances which are consented
 to in writing by Beneficiary, or any easements granted pursuant to the
 provisions of the Lease;

           (d) liens for Impositions or for sums resulting from noncompliance
with Legal Requirements so long as (1) the same are not yet payable or are
payable without the addition of any fine or penalty or (2) such liens are in the
process of being contested as permitted by Article II; and

           (e) liens of mechanics, laborers, materialmen, suppliers or vendors
for sums either disputed (provided that such liens are in the process of being
contested as permitted by Article II) or not yet due.

           1.17.2. Encroachments and Other Title Matters. Subject to the
                   -------------------------------------                
provisions of Article II of this Deed of Trust, if any of the Improvements
shall, at any time, encroach upon any property, street or right-of-way
adjacent to the Property, or shall violate the agreements or conditions
contained in any lawful restrictive covenant or other agreement affecting the
Property, or any part thereof, or shall impair the rights of others under any
easement or right-of-way to which the Property is subject, or the use of the
Property is impaired, limited or interfered with by reason of the exercise of
the right of surface entry or any other rights under a Deed of Trust or
reservation of any oil, gas, water or other minerals, then Trustor shall
promptly protect, indemnify, save harmless and defend Beneficiary from and
against all losses, liabilities, obligations, claims, damages, penalties, causes
of action, costs and expenses (including reasonable attorneys' fees and
expenses) based on or arising by reason of any such encroachment, violation or
impairment and in such case, in the event of an adverse final determination,
either (i) obtain, or cause to be obtained, valid and effective waivers or
settlements of all claims, liabilities and damages resulting from each such
encroachment, violation or impairment, whether the same shall affect Trustor or
Lessee; or (ii) make, or cause to be made, such changes in the Improvements, and
take, or cause to be taken, such other actions, as Trustor in the good faith
exercise of its judgment deems reasonably practicable, to remove such
encroachment, and to end such violation or impairment, including, if necessary,
the alteration of any of the Improvements, and in any event take all such
actions as may be necessary in order to

                                       17
<PAGE>
 
be able to continue the operation of the Improvements for the Primary Intended
Use substantially in the manner and to the extent the Improvements were operated
prior to the assertion of such violation or encroachment. Trustor's obligations
under this Section 1.17.2 shall be in addition to and shall in no way charge or
           --------------                                                      
diminish any obligation of any insurer under any policy of title or other
insurance.

     1.18.  Trustee's Powers. At any time, or from time to time, without
            ----------------                                            
liability therefor and without notice, upon written request of Beneficiary and
presentation of this Deed of Trust and the Note secured hereby for endorsement,
and without affecting the personal liability of any person for payment of the
indebtedness secured hereby or the effect of this Deed of Trust upon the
remainder of said Trust Estate, Trustee may (i) reconvey any part of said Trust
Estate, (ii) consent in writing to the making of any map or plat thereof, (iii)
join with Trustor in granting any easement thereon, or (iv) join with Trustor in
any extension agreement or any agreement subordinating the lien or charge
hereof.

     1.19. Beneficiary's Powers. Without affecting the liability of any
           --------------------                                        
other person liable for the payment of any obligation herein mentioned, and
without affecting the lien or charge of this Deed of Trust upon any portion of
the Property not then or theretofore released as security for the full amount of
all unpaid obligations, Beneficiary may, from time to time and without notice
(i) release any person so liable, (ii) extend the maturity or alter any of the
terms of any such obligation, (iii) grant other indulgences, (iv) release or
reconvey, or cause to be released or reconveyed at any time at Beneficiary's
option any parcel, portion or all of the Trust Estate, (v) take or release any
other or additional security for any obligation herein mentioned, or (vi) make
compositions or other arrangements with debtors in relation thereto.

     1.20. Tradenames. At the request of Beneficiary, Trustor shall execute
           ----------                                                      
a certificate in form satisfactory to Beneficiary listing the tradenames under
which Trustor intends to operate the Trust Estate, and representing and
warranting that Trustor does business under no other tradenames with respect to
the Trust Estate. Trustor shall immediately notify beneficiary in writing of
any change in said tradenames, and shall, upon request of Beneficiary, execute
any additional financing statements and other certificates revised to reflect
the change in tradename.

     1.21. Easement and Other Agreements. That Trustor shall faithfully
           -----------------------------                               
perform each and every obligation assumed under any reciprocal agreement,
easement agreement, operating agreement, parking agreement and/or other
agreement affecting the Property or any portion thereof. All such material
agreements shall be satisfactory in form and substance to Beneficiary and, if
Beneficiary so requests, Trustor's rights and interests under any such agreement
shall be assigned to Beneficiary. Failure by Trustor to perform any obligation
under any such agreement and such failure is not cured within 3 days shall
constitute a default hereunder.

     1.22. Survival of Warranties. To filly and faithfully satisfy and
           ----------------------                                     
perform the obligations of Trustor contained in the Loan Instruments, and each
agreement of Trustor incorporated by reference therein or herein, and any
modification or amendment thereof. All representations, warranties and covenants
of Trustor contained therein or incorporated by reference therein or herein
shall survive the finding of the loan evidenced by the Note and shall

                                       18
<PAGE>
 
remain continuing obligations, warranties and representations of Trustor during
any time when any portion of the obligations secured by this Deed of Trust
remain outstanding.

     1.23. Environmental Covenants. That Trustor shall at all times comply
           -----------------------                                        
with the following requirements:

          (a) Trustor shall not cause, permit or suffer any Hazardous Material
to be brought upon, treated, kept, stored, disposed of, discharged, released,
produced, manufactured, generated, refined or used upon, about or near the
Property or any portion thereof by Trustor, its agents, employees, contractors,
or invitees, or any other person, except in compliance with applicable law.

          (b) Trustor shall not cause, permit or suffer the existence or the
commission by Trustor, its agents, employees, contractors, or invitees, or by
any other person of material violation of any Environmental Law upon, about or
beneath the Property or any portion thereof.

          (c) Trustor shall not create or suffer to exist with respect to the
Property, or permit any of its agents to create or suffer to exist any lien,
security interest or other charge or encumbrance of any kind in favor any
governmental authority regarding the presence of any Hazardous Material or a
violation of Environmental Law, including without limitation, any lien imposed
pursuant to section 107(f) of the Superfund Amendments and Reauthorization Act
of 1986 (42 U.S.C. Section 9607(1)) or any similar state statute.

          (d) Trustor shall promptly take, or cause to be taken, all actions
required by any federal, state or local governmental agency or political
subdivision or reasonably necessary to mitigate Environmental Damages or to
allow full economic use of the Property, which requirements or necessity arise
from the presence upon, about or beneath the Property, of a Hazardous Material
or a violation of Environmental Law for which Trustor is alleged to be liable.
Such actions shall include, but not be limited to, the investigation of the
environmental condition of the Property, the preparation of any feasibility
studies, reports or remedial plans, and the performance of any cleanup,
remediation, containment, operation, maintenance, monitoring or restoration
work, whether on or off of the Property. Trustor shall take, or cause to be
taken, all actions necessary to restore the Property to a condition allowable
under applicable law or governmental policies following the introduction of
Hazardous Material upon, about or beneath the Property. Trustor shall proceed
continuously and diligently with such investigatory and remedial actions,
provided that in all cases such actions shall be in accordance with all
applicable requirements of governmental entities. Any such actions shall be
performed in a good, safe and workmanlike manner and shall minimize any impact
on the business conducted at the Property. Trustor shall pay, or cause to be
paid, all costs in connection with such investigatory and remedial activities,
including but not limited to all power and utility costs, and any and all taxes
or fees that may be applicable to such activities, to the extent that such costs
are not paid or incurred by third parties. Trustor shall promptly provide, or
cause to be provided, to Beneficiary copies of testing results and reports in
Trustor's possession (or that are reasonably available to Trustor) that are
generated in connection with the above activities. Promptly upon completion of
such investigation and remediation, Trustor shall permanently seal or cap all
monitoring wells

                                       19

<PAGE>
 
and test holes to industrial standards in compliance with applicable federal,
state and local laws and regulations, remove all associated equipment, and
restore the Property to the maximum extent possible, which shall include,
without limitation, the repair of any surface damage, including paving, caused
by such investigation or remediation hereunder.

          (e) Immediately upon Trustor's learning, or having reasonable cause to
believe, that any Hazardous Material in a quantity sufficient to require
remediation under applicable law is located in, on or under the Property or any
adjacent property, Trustor shall notify Beneficiary in writing of (a) any
enforcement, cleanup, removal, or other governmental or regulatory action
instituted, completed or threatened; (b) any written claim made or threatened by
any Person against Trustor or the Property relating to damage, contribution,
cost recovery, compensation, loss, or injury resulting from or claimed to result
from any Hazardous Material; and (c) any reports made to any federal, state or
local environmental agency arising out of or in connection with any Hazardous
Material in or removed from the Property, including any complaints, notices,
warnings or asserted violations in connection therewith. Receipt of such notice
shall not be deemed to create any obligation on the part of Beneficiary to
defend or otherwise respond to any such notification.

     1.24. Use of Property. That the uses of the Property shall be limited
           ---------------                                                
as follows:

           1.24.1.  Use. Trustor shall use the Property and the improvements
                    ---                                                     
thereon for its Primary Intended Use and for such other uses as may be necessary
or incidental to such use. Trustor shall not use the Property or any portion
thereof, or permit the Property to be used, for any other use without the prior
written consent of Beneficiary, which consent shall not be unreasonably
withheld. No use shall be made or permitted to be made of the Property, and no
acts shall be done, which will cause the cancellation of any insurance policy
covering the Property or any part thereof, nor shall Trustor sell or otherwise
provide to patrons, or permit to be kept, used or sold in or about the Property
any article which may be Prohibited by law or by the standard form of fire
insurance Policies, or any other insurance policies required to be Carried
hereunder, or fire underwriters regulations. Trustor shall, at its sole cost,
comply with all of the requirements pertaining to the Property or other
improvements of any insurance board, association, organization or company
necessary for the maintenance of insurance, as herein provided, covering the
Property and the Personal Property or Lessee's Personal Property.

           1.24.2.  Specific Prohibited Uses. Trustor shall not use or occupy or
                    ------------------------                                    
permit the Property to be used or occupied nor do or permit anything to be done
in or on the Property, in a manner which would or might (i) violate any law,
rule or regulation or Legal Requirement, (ii) (except as permitted pursuant to
the Lease), cause structural injury to any of the Improvements or (iii)
constitute a public or private nuisance or waste. Trustor shall not allow any
Hazardous Material to be located in, on or under the Property, or any adjacent
property, or incorporated in the Facility or any improvements thereon except in
compliance with applicable law (including any Environmental Law). Trustor shall
not allow the Property to be used as a landfill or a waste disposal site, or a
manufacturing, distribution or disposal facility for any Hazardous Materials.
Trustor shall neither suffer nor permit the Property or any portion thereof or
the Personal Property to be used in such a manner as (i) might reasonably tend
to impair Trustor's title thereto or to any portion thereof, or (ii) may
reasonably make possible a claim or claims of adverse

                                       20
<PAGE>
 
usage or adverse possession by the public, as such, or of implied dedication of
the Property or any portion thereof, or (iii) is in material violation of any
applicable Environmental Law.

     1.25.  Legal Requirements. Subject to Article II regarding permitted
            ------------------                                           
contests, Trustor shall promptly (a) comply, or cause to be complied, with all
Legal Requirements and Insurance Requirements in respect of the use, operation,
maintenance, repair and restoration of the Property, whether or not compliance
therewith shall require structural changes in any of the Improvements or
interfere with the use and enjoyment of the Property; and (b) procure, maintain
and comply with all licenses and other authorizations required for any use of
the Property then being made, and for the proper erection, installation,
operation and maintenance of the Property or any part thereof.

                                  ARTICLE II.

                              PERMITTED CONTESTS

          Trustor, or Lessee on behalf of Trustor, may contest, by appropriate
legal proceedings conducted in good faith and with due diligence, the amount or
validity or application, in whole or in part, of any Imposition or any Legal
Requirement or Insurance Requirement or any lien, attachment, levy, encumbrance,
charge or claim not otherwise permitted by Section 1.17. provided that:
                                           ------------                

          (a) in the case of an unpaid Imposition, lien, attachment, levy,
encumbrance, charge or claim, the commencement and continuation of such
proceedings shall suspend the collection thereof from Trustor and from the
property, and neither the Property nor any rents therefrom nor any part thereof
or interest therein would be in any danger of being sold, forfeited, attached or
lost pending the outcome of such proceedings;

          (b) in the case of a Legal Requirement, Trustor would not be subject
to criminal or material civil liability for failure to comply therewith pending
the outcome of such proceedings. Nothing herein, however, shall permit Trustor
to delay compliance with any requirement of an Environmental Law to the extent
such non-compliance poses an immediate threat of injury to any Person or to the
public health or safety or of material damage to any real or personal property;

          (c) in the case of a Legal Requirement and/or an Imposition, lien,
encumbrance or charge, Trustor shall give or cause to be given such reasonable
security, if any, as may be demanded by Beneficiary to insure ultimate payment
of the same and to prevent any sale or forfeiture of the affected Property or
the rents by reason of such non-payment or noncompliance;

          (d) no such contest shall interfere in any material respect with the
use or occupancy of the Property;

          (e) in the case of an Insurance Requirement, the coverage required by
Section 1.3 shall be maintained; and
-----------                         

                                       21
<PAGE>
 
          (f) if such contest be finally resolved against Trustor or Lessee, as
applicable, Trustor or Lessee shall, promptly pay the amount required to be
paid, together with all interest and penalties accrued thereon, or comply with
the applicable Legal Requirement or Insurance Requirement.


                                  ARTICLE III.

               ASSIGNMENT OF LEASES, RENTS, ISSUES AND PROFITS

          (a) Trustor hereby immediately and absolutely grants, transfers and
assigns to Beneficiary Trustor's entire interest in and to the Lease, written or
oral, and all agreements for the use and occupancy of all or any portion of the
premises, together with any and all extensions and renewals thereof and any and
all further leases, including subleases, upon all or any part of the premises,
and rent therein reserved, and any and all guarantees thereof, which may now or
hereinafter exist (all of such leases, agreements, subleases, guarantees and
tenancies being hereafter collectively referred to as the "leases" and
                                                           ------
individually as a "lease").                                
                   -----

          (b) Trustor warrants that it is the sole owner of the entire lessor's
interest in the leases; that the leases are valid and enforceable and have not
been altered, modified or amended in any manner whatsoever; that the lessees
named therein are not in default under any of the terms, covenants or
conditions thereof; that no rent reserved in the leases has been assigned or
anticipated and that no rent for any period subsequent to the date hereof has
been collected in advance of the time when the same became due under the terms
of the leases.

          (c) Trustor covenants with Beneficiary to observe and perform all the
obligations imposed upon the lessor under the leases and not to do or permit to
be done anything to impair the security thereof; not to collect any of the rent,
income and profits arising or accruing under the leases or from the premises
described in this Deed of Trust in advance of the time when the same shall
become due; not to execute any other assignment of lessor's interest in the
leases or assignment of rents arising or accruing from the leases or from the
premises described in this Deed of Trust.

          (d) So long as there shall exist no Event of Default, Trustor shall
have the right to collect at the time of, but not prior to the date provided for
the payment thereof, all rents, income and profits arising under the leases or
from the premises described therein and to retain, use and enjoy the same, and
all other rights of Trustor under the leases.

          (e) While an Event of Default exists, Beneficiary without in any way
waiving such default may at its option without notice and without regard to the
adequacy of the security for the principal sum, interest and indebtedness
evidenced by the Note or secured hereby, either in person or by agent, with or
without bringing any action or proceeding, or by a receiver appointed by a
court, take possession of the premises described in the leases and/or this Deed
of Trust and have, hold, and cause to be managed, leased and operated the same
on such terms and for such period of time as Beneficiary may deem proper and
either with or without taking possession of the premises in its own name,
demand, sue for or otherwise collect and receive all rents, income and profits
of the premises, including those past due and unpaid with

                                      22

<PAGE>
 
full power to make from time to time all alterations, renovations, repairs or
replacements thereto or thereof as may seem proper to Beneficiary and to apply
such rents, income and profits to the payment of: (a) all expenses of managing
the premises, including, without limitation, the salaries' fees and wages of a
managing agent and such other employees as Beneficiary may deem necessary or
desirable and all expenses of operating and maintaining the premises, including,
without limitation, all taxes, charges, claims, assessments, water and sewer
charges, any liens, and premiums for all insurance which Beneficiary may deem
necessary or desirable, and the cost of all alterations, renovations, repairs or
replacements, and all expenses incident to taking and retaining possession of
the premises; and (b) the principal sum, interest and indebtedness evidenced by
the Note or secured hereby, together with all costs and attorneys' fees, in such
order of priority as to any of the items mentioned in this paragraph (d) as
Beneficiary shall determine in its sole discretion, and collection of the rents,
issues, income and profits and the application thereof as herein provided shall
not be considered a waiver of any default by Trustor under the Note or this Deed
of Trust or under the leases.

          (f) Beneficiary shall not be liable for any loss sustained by Trustor
resulting from Beneficiary's failure to let the premises after an Event of
Default or from any other act or omission of Beneficiary in causing the premises
to be managed after default unless such loss is caused by the active negligence,
willful misconduct or bad faith of Beneficiary. Nor shall Beneficiary be
obligated to perform or discharge nor does Beneficiary hereby undertake to
perform or discharge any obligation, duty or liability under the leases or under
or by reason of this Article III and Trustor shall, and does hereby agree, to
indemnify Beneficiary for, and to hold Beneficiary harmless from, any and all
liability, expense, loss or damage which may or might be incurred under the
leases or under or by reason of this Article III and from any and all claims
                                     -----------                            
and demands whatsoever which may be asserted against Beneficiary by reason of
any alleged obligations or undertakings on its part to perform or discharge any
of the terms, covenants or agreements contained in the leases except those
resulting from Beneficiary's active negligence, willful misconduct or bad
faith. Should Beneficiary incur any such liability under the leases or under or
by reason of this Article III or in defense of any such claims or demands, the
                  -----------                                                 
amount thereof, including costs, expenses and reasonable attorneys' fees shall
be secured hereby and Trustor shall reimburse Beneficiary therefor immediately
upon demand and upon the failure of Trustor so to do Beneficiary may, at its
option, declare all sums evidenced by the Note or secured hereby immediately due
and payable. And it is further understood that this Article III shall not
                                                    -----------          
operate to place responsibility for the control, care, management or repair of
the premises upon Beneficiary, nor for the carrying out of any of the terms and
conditions of the leases; nor shall it operate to make Beneficiary responsible
or liable for any waste committed on the property by the tenants or any other
parties, or for any dangerous or defective condition of the premises, or for any
negligence in the management, upkeep, repair or control of the premises
resulting in loss or injury or death to any tenant, licensee, employee or
stranger.

                                  ARTICLE IV.

                              SECURITY AGREEMENT

          4.1.  Creation of a Security Interest. Trustor hereby grants to
                -------------------------------                          
Beneficiary a security interest in the Personal Property, including without
limitation any and all property of

                                      23

<PAGE>

similar type or kind hereafter located on or at the Property for the purpose of
securing all obligations of Trustor contained in any of the Loan Instruments.

          4.2.  Warranties, Representations and Covenants of Trustor. Trustor
                ----------------------------------------------------         
hereby warrants, represents and covenants as follows:

                (a) Except for the security interest granted hereby, Trustor is,
and as to portions of the Personal Property to be acquired after the date hereof
will be, the sole owner of the Personal Property, free from any adverse: lien,
security interest, encumbrance or adverse claim thereon; of any kind whatsoever.
Trustor will notify Beneficiary of, and will defend the Personal Property
against, all claims and demands of all persons at any time claiming the same or
any interest therein.

                (b) Trustor will not lease, sell, convey or in any manner
transfer the Personal Property without the prior written consent of Beneficiary,
except for replacements or in the ordinary course of business.

                (c) The Personal Property is not used or bought for personal,
family or household purposes.

                (d) The Personal Property will be kept on or at the Property and
Trustor will not remove the Personal Property from the Property without the
prior written consent of Beneficiary, except such portions or items of Personal
Property which are consumed or worn out in ordinary usage, all of which shall be
promptly replaced by Trustor; provided, that Trustor may move items of Personal
Property to another golf course facility owned by it, as long as Trustor
promptly notifies Beneficiary in writing that such items of Personal Property
have been moved and discloses the new location of such items.

                (e) Trustor maintains a chief executive office in the State of
Oklahoma, and Trustor will immediately notify Beneficiary in writing of any
change in its chief executive office as set forth in the beginning of this Deed
of Trust.

                (f) At the request of Beneficiary, Trustor will join Beneficiary
in executing one or more financing statements and all renewals and amendments
thereof pursuant to the Uniform Commercial Code of the State of Nevada in form
satisfactory to Beneficiary and will pay the cost of filing the same in all
public offices wherever filing is deemed by Beneficiary to be necessary or
desirable.

                (g) All covenants and obligations of Trustor contained herein 
relating to the Trust Estate shall be deemed to apply to the Personal Property
whether or not expressly referred to herein.

                (h) This Deed of Trust constitutes a Security Agreement as that
term is used in the Uniform Commercial Code of the State of Nevada.  

                (i) A portion of the goods encumbered hereby are, or are to
become, fixtures as that term is defined in Section 104.9313(l)(a) of the
Uniform Commercial Code of the

                                       24
<PAGE>
 
State of Nevada.

                                  ARTICLE V.

                             REMEDIES UPON DEFAULT

          5.1. Events of Default. Any of the following events shall be deemed an
               -----------------                                                
event of default hereunder (an "Event of Default"):
                                ---------------- 

               (a) if Trustor shall fail to make payment of any installment of
principal or interest or any other sum secured hereby (including the Note) when
the same becomes due and payable and such failure is not cured within 3 days;

               (b) a defined "Event of Default" shall occur under any other
Loan Document; or

               (c) if Trustor shall fail to make payment of any sum due and
payable pursuant to the Ground Leases, or shall otherwise default with respect 
to its obligations thereunder, and such failure or default is not cured within
10 days after the same becomes due and payable;

               (d) if Trustor shall fail to make payment of any sum due and
payable under the terms of the Third Party Loan, or shall otherwise default with
respect thereto and such failure is not cured within 3 days;

               (e) if Trustor shall:

                          (i)   admit in writing its inability to pay its debts
                                generally as they become due,

                          (ii)  file a petition in bankruptcy or a petition to
                                take advantage of any insolvency act,

                          (iii) make an assignment for the benefit of its
                                creditors,

                          (iv)  be unable to pay its debts as they mature,

                          (v)   consent to the appointment of a receiver of
                                itself or of the whole or any substantial part
                                of its property, or

                          (vi)  file a petition or answer seeking reorganization
                                or arrangement under the Federal bankruptcy laws
                                or any other applicable law or statute of the
                                United States of America or any state thereof;
                                
               (f) if Trustor shall, on a petition in bankruptcy filed against
it, be adjudicated as bankrupt or a court of competent jurisdiction shall
enter an order or decree 

                                       25
<PAGE>
 
appointing without the consent of Trustor, a receiver of Trustor or of the whole
or substantially all of its property, or approving a petition filed against it
seeking reorganization or arrangement of Trustor under the federal bankruptcy
laws or any other applicable law or statute of the United States of America or
any state thereof, and such judgment, order or decree shall not be vacated or
set aside or stayed within 60 days from the date of the entry thereof;

               (g) if Trustor shall be liquidated or dissolved, or shall begin
proceedings toward such liquidation or dissolution;

               (h) if an "Event of Default" under and as defined in the Lease
occurs and is not cured within any applicable grace or cure period;

               (i) a default by Trustor in any payment of principal or interest
on any obligations for borrowed money having a principal balance of $500,000 or
more in the aggregate, or in the performance of any other provision contained in
any instrument under which any such obligation is created or secured (including
the breach of any covenant thereunder), if an effect of such default is that
the holder(s) of such obligation cause such obligation to become due prior to
its stated maturity;

               (j) a final, non-appealable judgment or judgments for the
payment of money in excess of $500,000 in the aggregate not fully covered
(excluding deductibles) by insurance shall be rendered against Trustor and the
same shall remain undischarged, unvacated, unbonded or unstayed for a period of
60 consecutive days;

               (k) there occurred a breach of or default under any term,
covenant, agreement, condition, provision, representation or warranty contained
in the Note, this Deed of Trust or the Loan Agreement, and such breach or
default continues uncured or unremedied 5 days after written notice to Trustor
by, Beneficiary, provided that if such breach or default cannot with due
diligence be cured within a period of 5 days, such breach or default shall not
be an Event of Default if Trustor proceeds promptly and with due diligence to
cure the failure and diligently completes the curing thereof; provided further,
however, that the cure period shall not extend beyond 5 days as otherwise
provided above if the facts or circumstances giving rise to the default are
creating a further harm to Beneficiary or the Property and Beneficiary makes a
good faith determination that Trustor is not undertaking remedial steps that
Beneficiary would cause to be taken if Beneficiary were in possession of the
Property;

               (l) if Trustor shall, without complying with the provisions of
the Loan Documents related thereto, engage in a Transfer of the Property; or

               (m) if Trustor shall incur, or permit to be incurred, any Lien
with respect to the Trust Estate or any portion thereof or interest therein,
except as provided in Section 1.17 hereof.
                      ------------        
                                                            
          5.2. Acceleration Upon Default: Additional Remedies. In the event of
               ----------------------------------------------                 
any Event of Default, Beneficiary may declare all indebtedness secured hereby to
be due and payable and the same shall thereupon become due and payable without
any presentment, demand, protest or notice of any kind. Thereafter, Beneficiary
may:

                                       26
<PAGE>
 
               (a) Either in person or by agent, with or without bringing any
action or proceeding, or by a receiver appointed by a court and without regard
to the adequacy of its security, enter upon and take possession of the Trust
Estate, or any part thereof, in its own name or in the name of Trustee, and do
any acts which it deems necessary or desirable to preserve the value,
marketability or rentability of the Trust Estate, or any part thereof or
interest therein, increase the income therefrom or protect the security hereof
and, with or without taking possession of the Trust Estate, sue for or otherwise
collect the rents, issues and profits thereof, including those past due and
unpaid, and apply the same, less costs and expenses of operation and collection
including reasonable attorneys, fees, upon any indebtedness secured hereby, all
in such order as Beneficiary may determine. The entering upon and taking
possession of the Trust Estate, the collection of such rents, issues and profits
and the application thereof as aforesaid, shall not cure or waive any default or
notice of default hereunder or invalidate any act done in response to such
default or pursuant to such notice of default and, notwithstanding the
continuance in Possession of the Trust Estate or the collection, receipt and
application of rents, issues or profits, Trustee or Beneficiary shall be
entitled to exercise every right provided for in any of the Loan Instruments or
by law upon occurrence of any event of default, including the right to exercise
the power of sale;

               (b) Commence an action to foreclose this Deed of Trust as a
mortgage, appoint a receiver, or specifically enforce any of the covenants
hereof;

               (c) Exercise any or all of the remedies available to a secured
party under the Uniform Commercial Code of the State, including, but not limited
to:

                        (1) Either personally or by means of a court appointed
receiver, take possession of all or any of the Personal Property and exclude
therefrom Trustor and all others claiming under Trustor, and thereafter hold,
store, use, operate, manage, maintain and control, make repairs, replacements,
alterations, additions and improvements to and exercise all rights and powers of
Trustor in respect to the Personal Property or any part thereof. In the event
Beneficiary demands or attempts to take possession of the Personal Property in
the exercise of any rights under any of the Loan Instruments, Trustor promises
and agrees to promptly turn over and deliver complete possession thereof to
Beneficiary;

                        (2) Without notice to or demand upon Trustor, make such
payments and do such acts as Beneficiary may deem necessary to protect its
security interest in the Personal Property, including without limitation,
paying, purchasing, contesting or compromising any encumbrance, charge or lien
which is prior to or superior to the security interest granted hereunder, and in
exercising any such powers or authority to pay all expenses incurred in
connection therewith;

                        (3) Require Trustor to assemble the Personal Property
or any portion thereof, at a place designated by Beneficiary and reasonably
convenient to both parties, and promptly to deliver such Personal Property to
Beneficiary, or an agent or representative designated by it. Beneficiary and its
agents and representatives shall have the right to enter upon any or all of
Trustor's premises and property to exercise Beneficiary's rights hereunder;

                                       27
<PAGE>
 
                        (4) Sell, lease or otherwise dispose of the Personal
Property at public sale, with or without having the Personal Property at the
place of sale, and upon such terms and in such manner as Beneficiary may
determine. Beneficiary may be a purchaser at any such sale; and

                        (5) Unless the Personal Property is perishable or
threatens to decline speedily in value or is of a type customarily sold on a
recognized market, Beneficiary shall give Trustor at least 10 days prior written
notice of the time and place of any public sale of the Personal Property or
other intended disposition thereof. Such notice may be mailed to Trustor at the
address set forth at the beginning of this Deed of Trust.

               (d) Direct the Trustee to proceed to foreclose this Deed of Trust
by exercise of the power of sale herein contained in accordance with the Nevada
Revised Statutes Section 107.080 as the same may be amended from time to time.

               (e) Any other remedy permitted to be exercised by the beneficiary
of a deed of trust or a secured party or both under the laws of the State of
Nevada.

          5.3. Foreclosure By Power of Sale. If Beneficiary invokes the power of
               ----------------------------
sale herein contained, Trustee shall advertise and provide notice of sale of the
Trust Estate for the time and in the manner provided by the NRS. Trustee shall
then, without necessity of further demand upon Trustor, sell the Trust Estate at
public auction for the highest total price bid in a form satisfactory to the
Trustee at the time and place and under the terms designated in the notice of
sale. Beneficiary or Beneficiary's designee may purchase the Trust Estate at any
sale. Trustee shall deliver to the purchaser the Trustee's deed conveying all of
the Trustee's right, title and interest in the Trust Estate so sold, but without
any covenant or warranty, express or implied. Trustee shall apply the proceeds
of the sale in accordance with the NRS. Trustee may postpone or cancel any sale
of all or any portion of the Trust Estate in the manner provided by the NRS.

          5.4. Appointment of Receiver. If an Event of Default described in
               -----------------------
Section 5.1 of this Deed of Trust shall have occurred and be continuing,
-----------
Beneficiary, as a matter of right and without notice to Trustor or anyone
claiming under Trustor, and without regard to the then value of the Trust Estate
or the interest of Trustor therein, shall have the right to apply to any court
having jurisdiction to appoint a receiver or receivers of the Trust Estate, and
Trustor hereby irrevocably consents to such appointment and waives notice of any
application therefor. Any such receiver or receivers shall have all the usual
powers and duties of receivers in like or similar cases and all the powers and
duties of Beneficiary in case of entry as provided in Section 5.2 and shall
                                                      -----------
continue as such and exercise all such powers until the date of confirmation of
sale of the Trust Estate unless such receivership is sooner terminated.

          5.5. Remedies Not Exclusive. Trustee and Beneficiary, and each of 
               ----------------------
them, shall be entitled to enforce payment and performance of any indebtedness
or obligations secured hereby and to exercise all rights and powers under this
Deed of Trust or under any Loan Instrument or other agreement or any laws now or
hereafter in force, notwithstanding some or all of the said indebtedness and
obligations secured hereby may now or hereafter be otherwise secured whether by
mortgage, deed of trust, pledge, lien, assignment or otherwise. Neither the 

                                       28
<PAGE>
 
acceptance of this Deed of Trust nor its enforcement whether by court action or
pursuant to the power of sale or other powers herein contained, shall prejudice
or in any manner affect Trustee's or Beneficiary's right to realize upon or
enforce any other security now or hereafter held by Trustee or Beneficiary, it
being agreed that Trustee and Beneficiary, and each of them, shall be entitled
to enforce this Deed of Trust and any other security now or hereafter held by
Beneficiary or Trustee in such order and manner as they or either of them may in
their absolute discretion determine. No remedy herein conferred upon or reserved
to Trustee or Beneficiary is intended to be exclusive of any other remedy herein
or by law provided or permitted, but each shall be cumulative and shall be in
addition to every other remedy given hereunder or now or hereafter existing at
law or in equity or by statute. Every power or remedy given by any of the Loan
Instruments to Trustee or Beneficiary or to which either of them may be
otherwise entitled, may be exercised, concurrently or independently, from time
to time and as often as may be deemed expedient by Trustee or Beneficiary and
either of them may pursue inconsistent remedies.

          5.6. Request for Notice. Trustor hereby requests a copy of any
               ------------------
notice of default and that any notice of sale hereunder be mailed to it at the
address set forth in the first paragraph of this Deed of Trust.

          5.7. Charge for Statement. Trustor shall pay to Beneficiary the
               --------------------                                      
maximum amount allowed by law for each statement requested by Trustor regarding
the obligations secured by this Deed of Trust.

                                  ARTICLE VI.

                                 MISCELLANEOUS

          6.1. Governing Law. This Deed of Trust shall be governed by the
               -------------
internal laws of the State of Nevada. In the event that any provision or clause
of any of the Loan Instruments conflicts with applicable laws, such conflicts
shall not affect other provisions of such Loan Instruments which can be given
effect without the conflicting provision, and to this end the provisions of the
Loan Instruments are declared to be severable. This instrument cannot be waived,
changed, discharged or terminated orally, but only by an instrument in writing
signed by the party against whom enforcement of any waiver, change, discharge or
termination is sought.

          6.2. Trustor Waiver of Rights. Trustor waives the benefit of all laws
               ------------------------
now existing or that hereafter may be enacted providing for (i) any appraisal
before sale of any portion of the Trust Estate, and (ii) the benefit of all laws
that hereafter may be enacted in any way extending the time for the enforcement
of the collection of the Note or the debt evidenced thereby or creating or
extending a period of redemption from any sale made in collecting said debt. To
the fullest extent Trustor may do so, Trustor agrees that Trustor will not at
any time insist upon, plead, claim or take the benefit or advantage of any law
now or hereafter in force providing for any appraisement, valuation, stay,
extension or redemption, and Trustor, for Trustor, Trustor's heirs, devisees'
representatives, successors and assigns, and for any and all persons ever
claiming any interest in the Trust Estate, to the extent permitted by law,
hereby waives and releases all rights of redemption, valuation, appraisement,
stay of execution, notice of election to mature or declare due the whole of the
secured indebtedness and marshalling in the

                                      29
<PAGE>
 
event of foreclosure of the liens hereby created. If any law referred to in this
Section and now in force, of which Trustor, Trustor's heirs, devisees,
representatives, successors and assigns or other person might take advantage
despite this Section, shall hereafter be repealed or cease to be in force, such
law shall not thereafter be deemed to preclude the application of this Section.
Trustor expressly waives and relinquishes any and all rights and remedies which
Trustor may have or be able to assert by reason of the laws of the state
pertaining to the rights and remedies of sureties.

          6.3. Limitation of Interest. It is the intent of Trustor and
               ----------------------
Beneficiary in the execution of this Deed of Trust and the Note and all other
instruments securing the Note to contact in strict compliance with the usury
laws of the State of Nevada governing the loan evidenced by the Note. In
furtherance thereof, Beneficiary and Trustor stipulate and agree that none of
the terms and provisions contained in the Loan Instruments shall ever be
construed to create a contract for the use, forbearance or detention of money
requiring payment of interest at a rate in excess of the maximum interest rate
permitted to be charged by the laws of the State of Nevada governing the loan 
evidenced by the Note. Trustor or any guarantor, endorser or other party now or
hereafter becoming liable for the payment of the Note shall never be liable for
unearned interest on the Note and shall never be required to pay interest on the
Note at a rate in excess of the maximum interest that may be lawfully charged
under the laws of the State of Nevada and the provisions of this Section shall
control over all other provisions of the Note and any other instrument executed
in connection herewith which may be in apparent conflict herewith. In the event
any holder of the Note shall collect moneys which are deemed to constitute
interest which would otherwise increase the effective interest rate on the Note
to a rate in excess of that permitted to be charged by the laws of the State of
Nevada, all such sums deemed to constitute interest in excess of the legal rate
shall be immediately returned to the Trustor upon such determination.

          6.4. Statements by Trustor. Trustor, within 10 days after being given
               ---------------------
notice by mail, will furnish to Beneficiary a written statement stating the
unpaid principal of and interest on the Note and any other amounts secured by
this Deed of Trust and stating whether any offset or defense exists against such
principal and interest.

          6.5. Reconveyance by Trustee. Upon written request of Beneficiary
               -----------------------
stating that all sums secured hereby have been paid, and upon surrender of this
Deed of Trust and the Note to Trustee for cancellation and retention and upon
payment by Trustor of Trustee's fees, Trustee shall reconvey to Trustor, or the
person or persons legally entitled thereto, without warranty, any portion of the
Trust Estate then held hereunder. The recitals in such reconveyance of any
matters or facts shall be conclusive proof of the truthfulness thereof. The
grantee in any reconveyance may be described as "the person or persons legally
entitled thereto."

          6.6. Notices. Whenever Beneficiary, Trustor or Trustee shall desire to
               -------                                                          
give or serve any notice, demand, request or other communication with respect to
this Deed of Trust, each such notice, demand, request or other communication
shall be in writing and shall be addressed and mailed in accordance with the
provisions of the Loan Agreement.

          6.7. Acceptance by Trustee. Trustee accepts this Trust when this Deed
               ---------------------
of Trust, duly executed and acknowledged, is made a public record as provided by
law.

                                       30
<PAGE>
 
          6.8. Captions. The captions or headings at the beginning of each
               ---------                                                  
Section hereof are for the convenience of the parties and are not a part of this
Deed of Trust.

          6.9. Invalidity of Certain Provisions. If the lien of this Deed of
               --------------------------------                               
Trust is invalid or unenforceable as to any part of the debt, or if the lien is
invalid or unenforceable as to any part of the Trust Estate, the unsecured or
partially secured portion of the debt shall be completely paid prior to the
payment of the remaining and secured or partially secured portion of the debt,
and all payments made on the debt, whether voluntary or under foreclosure or
other enforcement action or procedure, shall be considered to have been first
paid on and applied to the full payment of that portion of the debt which is not
secured or fully secured by the lien of this Deed of Trust.

          6.10. Subrogation. To the extent that proceeds of the Note are owed
                -----------                                                 
to pay any outstanding lien, charge or prior encumbrance against the Trust
Estate, such proceeds have been or will be advanced by Beneficiary at Trustor's
request and Beneficiary shall be subrogated to any and all rights and liens owed
by any owner or holder of such outstanding liens, charges and prior
encumbrances, irrespective of whether said liens, charges or encumbrances are
released.

          6.11. No Merger. If both the lessor's and lessee's estates under any
                ---------
lease or any portion thereof which constitutes a part of the Trust Estate shall
at any time become vested in one owner, this Deed of Trust and the lien created
hereby shall not be destroyed or terminated by application of the doctrine of
merger and, in such event, Beneficiary shall continue to have and enjoy all of
the rights in and privileges of Beneficiary as to the separate estates. In
addition, upon the foreclosure of the lien created by this Deed of Trust on the
Trust Estate pursuant to the provisions hereof, any leases or subleases then
existing and created by Trustor shall not be destroyed or terminated by
application of the law of merger or as a matter of law or as a result of such
foreclosure unless Beneficiary or any purchaser at any such foreclosure sale
shall so elect. No act by or on behalf of Beneficiary or any such purchaser
shall constitute a termination of any lease or sublease unless Beneficiary or
such purchaser shall give written notice thereof to such tenant or subtenant.

          6.12. Due on Sale, Encumbrances etc. That (a) if at any time Trustor
                -----------------------------
should, without the prior consent in writing of Beneficiary, hypothecate or
encumber (except as expressly permitted hereby) its interest in the Property or
any part thereof, or if by operation of law the Trustor's interest in the
Property or any part thereof be hypothecated or encumbered, or (b) if a sale of
the Property shall occur, then Beneficiary may, at its option, declare all sums
secured hereby immediately due and payable. Consent to such a transaction shall
not be deemed to be a waiver of Beneficiary's right to require such consent to
further or successive transactions.

          6.13. Use of Trust Estate. Trustor represents to Beneficiary that the
                -------------------
Trust Estate is not used principally for agricultural or farming purposes.

          6.14. Limitations on Recourse. Notwithstanding anything in this Deed
                -----------------------                                       
of Trust to the contrary, Beneficiary's recourse for collection of any amounts
due under the Loan Instruments shall be limited to the interest of Trustor
(including any constituent partners of Trustor and, if Trustor is a trust, the
trustees and beneficiaries of such trust, and all of their respective successors
and assigns) in the Trust Estate under this Deed of Trust; provided,

                                       31
<PAGE>
 
however, the foregoing exculpatory language shall not: (i) constitute a 
release, discharge or waiver of any indebtedness evidenced by the Note, this 
Deed of Trust or the Loan Agreement, but the same shall continue until satisfied
or paid; (ii) affect any of the rights or liens of Beneficiary in and to the 
Trust Estate, or any part thereof, covered by this Deed of Trust, the Note or 
the Loan Agreement; (iii) affect any additional remedies and liens which 
Beneficiary has for the payment of the principal indebtedness, interest, or any 
other amount due under the Note, this Deed of Trust or the Loan Agreement, and 
for the enforcement of any rights which Beneficiary has under said instruments; 
or (iv) apply where Trustor has committed a fraud in connection with the Loan.

          6.15.  Partial Release of Collateral.  Trustor shall be entitled to a 
                 -----------------------------
release and reconveyance of this Deed of Trust in connection with the Second 
Closing or otherwise provided that the following conditions are satisfied:

                 (a)   At the time Trustor seeks a release of the lien of this 
Deed of Trust, there shall then be no uncured Event of Default under any of the 
Loan Instruments, and no event or circumstance which, with the giving of notice 
or passage of time, or both, would constitute an Event of Default under any of 
the Loan Instruments; and

                 (b)   If a release is sought in connection with the Second 
Closing Trustor shall have paid to Beneficiary, prior to or concurrently with 
the release of the lien of this Deed of Trust, $9,648,535.49 of the principal 
balance of the Note on or before November 15, 1998; and

                 (c)   If a release is sought other than in connection with the 
Second Closing Trustor shall have paid to Beneficiary, prior to or concurrently 
with the release of the lien of this Deed of Trust, the sum of (i) the entire 
unpaid principal balance of the Note, together with all accrued and unpaid 
interest thereon, and (ii) the Appreciation Participation as defined in the 
Note.

          6.16.  Effect of Partial Release.  If there is a partial release by 
                 -------------------------
the Trustee of any portion of the Trust Estate, the Trustee and Beneficiary may 
look to the remainder of the Trust Estate as security for the full payment of 
the Note and all other obligations secured by this Deed of Trust.

          6.17.  Venue.  In the case of any dispute arising hereunder, venue 
                 -----
will be determined in accordance with the provisions of the Loan Agreement.

          6.18.  Integration.  This Deed of Trust, the Note and the Loan 
                 -----------
Agreement represent the entire embody the final, entire agreement among the 
parties hereto and supersede any and all prior commitments, term sheets, 
agreements, representations and understandings, whether written or oral, 
relating to the subject matter hereof and may not be contradicted or varies by 
evidence of prior, contemporaneous, or subsequent oral agreements or discussions
of the parties hereto.  There are no unwritten oral agreements among the parties
hereto.  There are no unwritten oral agreements among the parties thereto.

                           (signature page follows)
<PAGE>
 
          IN WITNESS WHEREOF, Trustor has executed this Deed of Trust as of the 
date and year first above written.

                                   TRUSTOR:

                                   BADLANDS GOLD CLUB, INC.



                                   By: /s/ Elby J. Beal
                                      --------------------------
                                   Name:  Elby J. Beal
                                        ------------------------
                                   Its:   President
                                       -------------------------



                                      33


<PAGE>
 
                                ACKNOWLEDGMENT
                                --------------

STATE OF OKLAHOMA                     )
                                      )    SS:
COUNTY OF OKLAHOMA                    )


     The foregoing instrument was acknowledged before me this 15th day of 
August, 1998, by Elby J. Beal as the President of The Badlands Golf Club, Inc., 
a Nevada corporation.

                                         /s/ Carol Carrier
                                        --------------------------------------  
                                        Notary Public

My Commission Expires:

   Aug. 2, 1999
--------------------
     (SEAL)

<PAGE>
 
                                   EXHIBIT A
                                   ---------

                         Legal Description of the Land
                         -----------------------------


                                      A-1

<PAGE>
 
                                                                    LV-823615-RD

                                  DESCRIPTION
                                  -----------

ALL THAT REAL PROPERTY SITUATED IN THE COUNTY OF CLARK, STATE OF NEVADA, BOUNDED
AND DESCRIBED AS FOLLOWS:

PARCEL I:

LOT FIVE (5) OF AMENDED PECCOLE WEST, AS SHOWN BY MAP THEREOF ON FILE IN BOOK 
83 OF PLATS, PAGE 57, IN THE OFFICE OF THE COUNTY RECORDER, CLARK COUNTY, NEVADA
RECORDS.

PARCEL IA:

AN EASEMENT FOR A CART PATH, PRIVATE ROADWAY AND WALKWAY WITH THE RIGHT OF 
INGRESS AND EGREES AS CREATED BY AN INSTRUMENT AND RECORDED DECEMBER 27, 1995 IN
BOOK 951227 OF OFFICIAL RECORDS, CLARK COUNTY, NEVADA, AS DOCUMENT NO. 01654 
OVER AND ACROSS THE FOLLOWING:

COMMENCING AT THE SOUTHWEST CORNER OF SAID SECTION 31 AS SHOWN ON A PARCEL MAP 
RECORDED IN FILE 76 OF PARCEL MAPS, PAGE 65 IN THE OFFICE OF THE CLARK COUNTY 
RECORDER, SAID POINT BEING THE CENTERLINE INTERSECTION OF CHARLESTON BLVD. AND 
HUALAPAI WAY; THENCE NORTH 06 DEGREES 05'57" WEST, ALONG THE CENTERLINE OF 
HUALAPAI WAY AND THE WEST LINE OF SAID SECTION 31, A DISTANCE OF 893.94 FEET; 
THENCE NORTH 83 DEGREES 54'03" EAST, A DISTANCE OF 50.00 FEET TO A POINT ON THE 
EAST LINE OF HUALAPAI WAY; THENCE NORTH 64 DEGREES 15'40" EAST, A DISTANCE OF 
619.87 FEET; THENCE NORTH 72 DEGREES 29'37" EAST, A DISTANCE OF 496.92 FEET; 
THENCE SOUTH 68 DEGREES 25'40" EAST, A DISTANCE OF 319.98 FEET; THENCE SOUTH 87 
DEGREES 40'02" EAST, A DISTANCE OF 513.23 FEET; THENCE NORTH 87 DEGREES 55'09" 
EAST, A DISTANCE OF 1033.86 FEET TO A POINT ON THE WEST LINE OF THE FUTURE 
PALACE COURT (A PRIVATE STREET) SAID POINT BEING THE POINT OF BEGINNING; THENCE 
NORTH 59 DEGREES 55'O5" EAST, A DISTANCE OF 90.00 FEET TO A POINT ON THE EAST 
LINE OF SAID PALACE COURT HEREINAFTER REFERRED TO AS POINT "A"; THENCE NORTH 30 
DEGREES 04'55" WEST, ALONG THE SAID EAST LINE OF PALACE COURT A DISTANCE OF 
248.13 FEET TO POINT ON A CURVE CONCAVE EASTERLY, HAVING A RADIUS OF 295.00 FEET
AND SUBTENDING A CENTRAL ANGLE OF 13 DEGREES 16'62"; THENCE NORTHERLY ALONG 
SAID TANGENT CURVE, TO THE RIGHT AN ARC DISTANCE OF 68.38 FEET; THENCE SOUTH 81
DEGREES 53'08" WEST, A DISTANCE OF 90.80 FEET TO A POINT ON THE SAID WESTERLY 
LINE OF PALACE COURT BEING ON A CURVE CONCAVE EASTERLY, HAVING A RADIUS OF 
385.00 FEET AND SUBTENDING A CENTRAL ANGLE OF 15 DEGREES 15'20"; THENCE 
SOUTHEASTERLY ALONG SAID CURVE, FROM A RADIAL WHICH BEARS SOUTH 75 DEGREES 
14'25" WEST, TO THE RIGHT AN ARC DISTANCE OF 107.96 FEET; THENCE SOUTH 30 
DEGREES 04'55" EAST, ALONG SAID WESTERLY LINE OF PALACE COURT A DISTANCE OF 
248.13 FEET TO THE POINT OF BEGINNING.

PARCEL IB:

                          ("CONTINUED ON NEXT PAGE")
                           ------------------------

                                    - 17 -

<PAGE>
 
                                                                    LV-823615-RD

AN EASEMENT FOR A CART PATH, PRIVATE ROADWAY AND WALKWAY WITH THE RIGHT OF 
INGRESS AND EGRESS AS CREATED BY AN INSTRUMENT RECORDED DECEMBER 27, 1995 IN 
BOOK 951227 OF OFFICIAL RECORDS, CLARK COUNTY, NEVADA, AS DOCUMENT NO. 01654 
OVER AND ACROSS THE FOLLOWING:

COMMENCING AT THE AFORESAID POINT "A"; THENCE SOUTH 30 DEGREES 04'55" EAST,
ALONG THE GOLF COURSE BOUNDARY AND THE EASTERLY LINE OF THE SAID PALACE COURT, A
DISTANCE OF 41.50 FEET; THENCE SOUTH 30 DEGREES 04'58" EAST, A DISTANCE OF
376.81 FEET TO A POINT ON A CURVE CONCAVE WESTERLY HAVING A RADIUS OF 1245.00
FEET AND SUBTENDING A CENTRAL ANGLE OF 23 DEGREES 02'44"; THENCE SOUTHEASTERLY
ALONG SAID CURVE TO THE RIGHT AN ARC DISTANCE OF 500.76 FEET TO A POINT OF
REVERSE CURVATURE WITH A CURVE CONCAVE NORTHEASTERLY HAVING A RADIUS OF 10.00
FEET AND SUBTENDING A CENTRAL ANGLE OF 80 DEGREES 48'41"; THENCE FROM A RADIAL
WHICH BEARS SOUTH 82 DEGREES 57'46" WEST, SOUTHEASTERLY ALONG CURVE TO THE LEFT
AN ARC DISTANCE OF 14.10 FEET; THENCE SOUTH 87 DEGREES 50'55" EAST, TANGENT TO
THE LAST CURVE, A DISTANCE OF 118.78 FEET TO A POINT OF BEGINNING OF A 40.00
FOOT WIDE EASEMENT BEING 20.00 FEET ON EACH SIDE OF THE FOLLOWING DESCRIBED
LINE; THENCE SOUTH 02 DEGREES 09'05" WEST, ACROSS THE PRIVATE ACCESS ROAD TO
PECCOLE WEST LOT 9, A DISTANCE OF 72.00 FEET; THENCE SOUTH 27 DEGREES 15'23"
EAST, A DISTANCE OF 56.89 FEET; THENCE NORTH 66 DEGREES 59'15" EAST, A DISTANCE
OF 113.93 FEET; THENCE SOUTH 54 DEGREES 05'43" EAST, A DISTANCE OF 73.85 FEET TO
A POINT ON THE BOUNDARY LINE OF THE GOLF COURSE BEING THE POINT OF ENDING, THE
POINT OF ENDING IS AT A POINT ON THE BOUNDARY WHICH BEARS SOUTH 64 DEGREES
47'20" WEST, A DISTANCE OF 33.15 FEET FROM THE SOUTHWEST CORNER OF LOT 9 AS
SHOWN ON THE ALTA SURVEY MAP. THE SIDELINES OF THE AFORESAID EASEMENT SHALL BE
LENGTHENED OR SHORTENED TO CREATE A CONTINUOUS STRIP OF LAND AND TERMINATE AT
THE BOUNDARY LINES OF THE GOLF COURSE PROPERTY.

PARCEL II:

LOT 21 OF PECCOLE WEST LOT 10 AS SHOWN BY MAP THEREOF ON FILE IN BOOK 83 OF 
PLATS, PAGE 61, IN THE OFFICE OF THE COUNTY RECORDER, CLARK COUNTY, NEVADA.

                              * * * * * * * * * *



KMI



                                    - 18 -

<PAGE>
 
                                   EXHIBIT B
                                   ---------

                         Defined Terms: Interpretation
                         -----------------------------

Defined Terms. For all purposes of this Deed of Trust, except as otherwise
-------------                                                            
expressly provided or unless the context otherwise requires, the terms defined
below have the meanings assigned to them below.

          Additional Charges: Means all (1) amounts, liabilities, obligations
          ------------------                                                 
and impositions which Trustor assumes or agrees to pay under the Note or this
Deed of Trust and (2) in the event of any failure on the part of Trustor to pay
any of those items referred to in clause (1) above, fines, penalties, interests
and costs which may be added for nonpayment or late payment of such items.

          Affiliate: As applied to any Person, means any other Person directly
          ---------                                                           
or indirectly controlling, controlled by, or under common control with, that
Person.

          Appreciation Participation: As defined in Section 3.1 of the Note.
          --------------------------                -----------             

          Award: Means all compensation, sums or anything of value awarded, paid
          -----                                                                 
or received on a total or partial Condemnation.

          Capital Improvements Advance: Means a loan in an amount of principal
          ----------------------------                                        
up to $315,000 made on or prior to July 31, 1999 the proceeds of which will be
used to fund Initial Capital Improvements to the Property (as defined in the
Note).

          Code: The Internal Revenue Code of 1986, as amended.
          ----

          Condemnation: Means (a) the exercise of any governmental power,
          ------------                                                   
whether by legal proceedings or otherwise, by a Condemnor, and (b) a voluntary
sale or transfer by Trustor to any Condemnor, either under threat of
condemnation or while legal proceedings for condemnation are pending.

          Condemnor: Means any public or quasi-public authority, or private
          ---------                                                         
corporation or individual, having the power of condemnation.

          Control: Means (including, with correlative meanings, the terms
          -------                                                        
"controlling" and "controlled by"), as applied to any Person, the possession,
directly or indirectly, of the power to direct or cause the direction of the
management and policies of that Person, whether through the ownership of voting
securities, by contract or otherwise.

          Deed of Trust: As defined in the Preamble.
          -------------                    --------

          Environmental Damages: Means all liabilities, obligations, claims,
          ---------------------                                             
damages (including punitive damages), penalties, causes of action, demands,
judgments, costs and expenses "including reasonable attorneys' fees and
expenses), to the extent permitted by law,


                                      B-1
<PAGE>
 
imposed upon or incurred by or asserted against Beneficiary or the Property by
reason of any Environmental Law (irrespective of whether there has occurred any
violation of any Environmental Law) in respect of the Property howsoever
arising, without regard to fault on the part of Trustor.

          Environmental Law: Means all applicable statutes, regulations, rules,
          -----------------                                                    
ordinances, codes, licenses, permits, orders, demands, approvals, authorizations
and similar items of all governmental agencies, departments, commissions,
boards, bureaus or instrumentalities of the United States, states and political
subdivisions thereof and all applicable judicial, administrative and regulatory
decrees, judgments and orders relating to the protection of human health or the
environment as in effect on the date hereof or as thereafter amended, including
all requirements as of the date hereof, including but not limited to those
pertaining to reporting, licensing, permitting, investigation, removal and
remediation of emissions, discharges, releases or threatened releases of
"Hazardous Materials," substances, pollutants, contaminants or hazardous or
toxic substances, materials or wastes whether solid, liquid or gaseous in
nature, into the air, surface water, ground water or land, or relating to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of substances, pollutants, contaminants or hazardous or
toxic substances, materials, or wastes, whether solid, liquid or gaseous in
nature, including: (x) the Comprehensive Environmental Response, Compensation
and Liability Act (42 U.S.C. (S)(S) 9601 et seq.), the Resource Conservation
                                         ------                           
and Recovery Act (42 U.S.C. (S)(S) 6901 et seq.), the Clean Air Act (42 U.S.C.
                                      ------       
(S)(S) 7401 et seq.), the Federal Water Pollution Control Act (33 U.S.C. (S)
            ------                                                        
1251), the Safe Drinking Water Act (42 U.S.C. (S)(S) 300f et seq.), the Toxic
                                                          ------
Substances Control Act (15 U.S.C. (S)(S) 2601 et seq.), the Endangered Species
                                              ------                        
Act (16 U.S.C. (S)(S) 1531 et seq.), the Emergency Planning and Community
                           ------                                              
Right-to-Know Act of 1986 (42 U.S.C: (S)(S) 11001 et seq.), and (y) analogous
                                                  ------                  
state and local provisions.

          Event of Default: As defined in Section 5.l.
          ----------------                -----------

          Facility: Means the Property consisting of a 27-hole golf course,
          --------
club house and relating facilities located on the Land.

          Fair Market Value: As defined in the Note.
          -----------------                         

          Full Replacement Cost: Means the actual replacement cost thereof from
          ---------------------                                                
time to time including increased cost of construction endorsement, less
exclusions provided in the normal fire insurance policy.

          Ground Leases: As defined in Granting Clause One.
          -------------                -------------------

          Hazardous Material: Means any chemical substance:
          ------------------                               

               (i)   the presence of which requires investigation or remediation
     under any federal, state or local statute, regulation, ordinance, order,
     action or policy, administrative request or civil complaint under any of
     the foregoing or under common law;


                                      B-2
<PAGE>
 
               (ii)  which is defined as a "hazardous waste" or "hazardous
     substance" under any federal, state or local statute, regulation or
     ordinance or amendments thereto as in effect as of the date hereof, or as
     thereafter amended, including the Comprehensive Environmental Response,
     Compensation and Liability Act (42 U.S.C. Section 9601 et seq.) and or the
     Resource Conservation and Recovery Act (42 U.S.C. Section 6901 et seq.);

               (iii) which is toxic, explosive, corrosive, flammable,
     infectious, radioactive, carcinogenic, mutagenic or otherwise hazardous and
     as of the date hereof, or as thereafter amended, is regulated by any
     governmental authority, agency, department, commission, board, agency or
     instrumentality of the United States, or any state or any political
     subdivision thereof having or asserting jurisdiction over the Property;

               (iv) the presence of which on any of the Property causes a
     nuisance upon such Property or to adjacent properties or poses a hazard to
     the health or safety of persons on or about any of the Property;    

               (v) the presence of which on adjacent properties constitutes a
     trespass by Trustor, Lessee or the Property; or

               (vi) which contains gasoline, diesel fuel or other petroleum
     hydrocarbons, polychlorinated biphenyls (PCBs) or asbestos or
     asbestos-containing materials or urea formaldehyde foam insulation; or

               (vii) radon gas.

          Impositions: As defined in Section 1.7(a).
          -----------                ---------------

          Insurance Requirements: All terms of any insurance policy required by
          ----------------------                                               
this Deed of Trust and all requirements of the issuer of any such policy.

          Land: As defined in Granting Clause One.
          ----

          Lease: Means that certain Lease, dated as of August 18, 1998, between
          -----
Trustor and Lessee.

          Legal Requirements: All federal, state, county, municipal and other
          ------------------                                                 
governmental statutes, laws (including the Americans with Disabilities Act and
any Environmental Laws) rules, orders, regulations, ordinances, judgments,
decrees and injunctions affecting either the Property or the construction, use
or alteration thereof, whether now or hereafter enacted and in force, including
any which may (i) require repairs, modifications or alterations in or to the
Property; (ii) in any way adversely affect the use and enjoyment thereof, and
all permits, licenses and authorizations and regulations relating thereto, and
all covenants, agreements, restrictions and encumbrances contained in any
instruments, either of record or known to Trustor, at any


                                      B-3
<PAGE>
 
time in force affecting the Property; or (iii) require the cleanup or other
treatment of any Hazardous Material.

          Lessee: American Golf Corporation, a California corporation.
          ------                                                      

          Lessee's Personal Property: All machinery, equipment, furniture,
          --------------------------                                      
furnishings, movable walls or partitions, phone system, computers or trade
fixtures or other personal property, and consumable inventory and supplies,
owned by Lessee and used or useful in Lessee's business on the Property,
including all items of furniture, furnishings, equipment, supplies and
inventory, kitchen fixtures, bar equipment, flatware, lawn mowers and other
gardening tools, tractors and other motorized vehicles, and golf carts, except
items, if any, that are fixtures, as defined in Granting Clause Two.
                                                -------------------

          NGP: Means National Golf Operating Partnership, L.P., a Delaware
          ---
limited partnership.

          Note: Means the Secured Participating Promissory Note of even date
          ----                                                              
herewith of Trustor in favor of Beneficiary in the aggregate principle amount of
$22,648,535.49].

          NRS: Means Nevada Revised Statutes.
          ---                                

          Officer's Certificate: A certificate of Trustor signed by an officer
          ---------------------                                               
of Trustor.

          Overdue Rate: On any date, a rate equal to 2.00% above the Base
          ------------                                                   
Interest Rate (as such term is defined in the Note), but in no event greater
than the maximum rate then permitted under applicable law.

          Person: Means and includes natural persons, corporations, limited
          ------                                                           
partnerships, general partnerships, joint stock companies, joint ventures,
associations, companies, trusts, banks, trust companies, land trusts, business
trusts, Indian tribes or other organizations, whether or not legal entities, and
governments and agencies and political subdivisions thereof.

          Personal Property: As defined in Granting Clause Nine.
          -----------------                --------------------

          Primary Intended Use: Means the operation of a golf course, consisting
          --------------------                                                  
of the Facility, and other activities customarily associated with or incidental
to the operation of a golf course, including sale or rental of golf-related
merchandise at a golf professional's shop, sale of memberships, furnishing of
lessons by a golf professional, of a driving range, and sales of food
and beverages, including liquor sales.

          Property:  As defined in Granting Clause Two.
          --------                 -------------------

          Rents: As defined in Granting Clause Three.
          -----                ---------------------

          Second Closing: Means execution of loan documents on or before
          --------------                                                
November 15, 1998 in connection with the Third Party Loan.


                                      B-4
<PAGE>
 


          State: Means the State of Nevada.
          -----

          Third Party Loan: As defined in the Note.
          ----------------

          Transfer of the Property: As defined in the Note.
          ------------------------

          Unsuitable For Its Primary Intended Use: A state or condition of the 
          ---------------------------------------
Facility such that in the good faith judgment of Trustor, reasonably exercised, 
the Facility cannot be operated on a commercially practicable basis for its 
Primary Intended Use.

          Water Rights: Means certain water rights pertaining to the Property as
          ------------
described in Granting Clause Thirteen.
             ------------------------
 
          Interpretation. The foregoing defined terms include the plural as well
          --------------
as the singular. "Including" and variants thereof shall be deemed to mean
"including without limitation." All accounting terms not otherwise defined
herein have the meanings assigned to them in accordance with generally accepted
accounting principles as at the time applicable. All references in this Deed of
Trust to designated "Articles," "Sections" and other subdivisions are to the
designated Articles, Sections and other subdivisions of this Deed of Trust. The
words "herein," "hereof" and "hereunder" and other words of similar import refer
to this Deed of Trust as a whole and not to any particular Article, Section or
other subdivision.


                                      B-5