<PAGE>
                                       
                                                                EXHIBIT 10.16

                                 PROMISSORY NOTE


U.S. $2,525,000.00                                           Las Vegas, Nevada
                                                             October 14, 1998

         FOR VALUE RECEIVED, SAXTON INCORPORATED, a Nevada corporation
("Maker"), hereby promises to pay to the order of JAMES C. SAXTON, an individual
("Lender"), at 5440 W. Sahara Avenue, Third Floor, Las Vegas, Nevada 89146, or
such other address as the holder hereof may give Maker in writing from time to
time, the principal amount of TWO MILLION FIVE HUNDRED TWENTY FIVE THOUSAND
DOLLARS ($2,525,000.00) (the "Note Amount"), in lawful money of the United
States of America, without set-off or counterclaim, together with interest on
the principal balance hereof outstanding from time to time from the date of this
Note at the interest rate hereinafter set forth. The Note Amount includes the
sum of Twenty Five Thousand Dollars ($25,000.00) representing a loan fee payable
from Maker to Lender. Maker further agrees as follows:

         1. MATURITY DATE. The unpaid principal balance hereof, together with
all unpaid interest accrued thereon, and all other amounts payable by Maker
hereunder shall be due and payable on demand of the Lender. If not sooner paid,
all said amounts shall be due and payable on the earlier of (1) the date Maker
obtains a construction loan for the project known as South Valley or (2) January
14, 1999 (the "Maturity Date").

         2. INTEREST RATE. Interest shall accrue on the Note Amount, from
October 14, 1998 until the Note Amount is paid in full at the rate of twelve
percent (12%) per annum. Interest shall be calculated on the basis of a 360 day
year and actual days elapsed.

         3. PAYMENTS. Interest accrued on the Note Amount as of the last day of
each month, commencing with the month ending October, 1998 shall be due and
payable on the first day of the next following month. All amounts payable by
Maker hereunder shall be due and payable on the Maturity Date if not sooner
paid.

         4. DEFAULT INTEREST. Upon any default hereunder, and continuing until
such time as such default has been fully and completely cured, the Note Amount
shall bear interest at a default rate equal to five percent (5%) over and above
the interest rate then in effect hereunder ("Default Rate"). Such interest shall
begin accruing on the unpaid portion of the Note Amount on the first day of the
default and shall be payable on the first day of each month thereafter, or on
demand if sooner demanded; provided, however, that if the default is a failure
to pay any sum due hereunder, Maker shall have five (5) days from the date such
sum became due to cure such default, during which period the Default Rate shall
not accrue. If such default is not cured within the five (5) day grace period,
the Default Rate will be deemed to have begun accruing on the date such sum
became due. Maker acknowledges that upon the occurrence of an Event of Default,
the damages to Lender would be extremely difficult to ascertain, including the
Lender's lost profit and loss of use of the funds evidenced hereby and expense
incurred in connection with such default and that the accrual of interest at the
Default Rate is a fair and reasonable estimate of the loss to the Lender
incurred by virtue of such default.

                                       

<PAGE>

         5. LATE CHARGE. Maker acknowledges that if any interest payment is not
made when due or if the entire amount due under this Note is not paid by the
Maturity Date, the holder hereof will incur extra administrative expenses (i.e.,
in addition to expenses incident to the receipt of timely payment) and the loss
of the use of funds in connection with the delinquency in payment. Because the
actual damage is suffered by the holder hereof by reason of such extra
administrative expenses and loss of use of funds would be impracticable or
extremely difficult to ascertain, Maker agrees that five percent (5%) of the
amount so delinquent shall be the amount of damages to which such holder is
entitled, upon such breach, in compensation therefore. Therefore, Maker shall,
in the event any payment required under this Note is not paid within five (5)
days after the date when such payment becomes due and payable, without further
notice, pay to the holder to cover such extra administrative expenses and loss
of use of funds, liquidated damages in the amount of five percent (5%) of the
amount of such delinquent payment. The provisions of this paragraph are intended
to govern only the determination of damages in the event of a breach in
performance of the obligations of Maker to make timely payments hereunder.
Nothing in this Note shall be construed as an express or implied agreement by
the holder hereof to forbear any collection of any delinquent payment or in
exercising any of its rights and remedies, or be construed as in any way giving
Maker the right, express or implied, to fail to make timely payments hereunder,
whether upon payment of such damages or otherwise. The right of the holder
hereof to receive payment of such liquidated and actual damages, and receipt
thereof, are without prejudice to the right of such holder to collect such
delinquent payments and any other amounts provided to be paid hereunder or to
declare a default hereunder.

         6. APPLICATION OF PAYMENTS. Every payment received with respect hereto
is to be applied as follows: first to the payment of any costs, expenses,
charges or fees due and owing from Maker to Lender under the terms of this Note;
second, to the payment of accrued interest on the principal balance remaining
unpaid from time to time; and third, to reduce the principal balance hereof.

         7. PREPAYMENT. Any time prior to the Maturity Date Maker may prepay
this Note, in full only, by the payment to Lender of the entire Note Amount then
outstanding, together with any accrued but unpaid interest thereon.

         8. COSTS OF COLLECTION. Maker promises to pay all costs, expenses and
reasonable attorneys' fees ("reasonable" being the fees charged at the normal
hourly rates of Lender's attorneys) incurred by Lender in the exercise of any
remedy (with or without litigation), in any proceeding for the collection of the
debt represented by this Note or the realization upon any security securing this
Note, in protecting or sustaining the lien or priority of said other security;
in any adversary proceeding or contested matter, whether or not brought by
Lender, under the Federal Bankruptcy Code or Rules or arising in or related to a
case under the Federal Bankruptcy Code or Rules, including without limitation
any costs or fees incurred in filing proofs of claim, attending hearings or in
any proceeding relating to the automatic stay provided by 11 U.S.C. ss. 362; or
in any litigation or controversy arising from or in connection with this Note,
including any bankruptcy, receivership, injunction or other proceeding, or any
appeal from or petition for review of any of the foregoing, in which the Lender
prevails. If a judgment is obtained thereon which includes an award

                                       -2-

<PAGE>

of attorneys' fees, such attorneys' fees, costs and expenses shall be in such 
amount as the court shall deem reasonable, which judgment shall bear interest 
at the Default Rate from the date it is rendered to and including the date of 
payment to Lender.

         9. DEFAULTS; ACCELERATION. The occurrence of any Event of Default (as
hereinafter defined) shall be a default hereunder. Upon the occurrence of an
Event of Default, Holder may declare the entire principal balance of the Note
then outstanding (if not then due and payable) and all other obligations of
Borrower hereunder to be due and payable immediately. Subject to the applicable
provisions of law, upon any such declaration, the principal of the Note and
accrued and unpaid interest, and all other amounts to be paid under this Note
shall become and be immediately due and payable, anything in this Note to the
contrary notwithstanding.

         The occurrence of any one or more of the following, whatever the reason
therefor, shall constitute an "Event of Default" hereunder:

                  (a) Maker shall fail to pay any installment of principal or
interest on the Note when due; or

                  (b) Maker shall fail to perform or observe any term, covenant
or agreement contained in this Note on its part to be performed or observed,
other than the failure to make a payment covered by subsection (a), and such
failure shall continue uncured as of the earlier of thirty (30) calendar days
after the occurrence of such failure or ten (10) calendar days after written
notice of such failure is given by Lender to Maker (the cure period set forth in
this subsection (b) shall not apply to any other Event of Default); or

                  (c) Maker (which term shall include any entity comprising
Maker) is dissolved or liquidated, or otherwise ceases to exist, or all or
substantially all of the assets of Maker are sold or otherwise transferred
without Lender's written consent; or

                  (d) Maker is the subject of an order for relief by the
bankruptcy court, or is unable or admits in writing its inability to pay its
debts as they mature, or makes an assignment for the benefit of creditors; or
Maker applies for or consents to the appointment of any receiver, trustee,
custodian, conservator, liquidator, rehabilitator or similar officer
("Receiver"); or any Receiver is appointed without the application or consent of
Maker, as the case may be, and the appointment continues undischarged or
unstayed for thirty (30) calendar days; or Maker institutes or consents to any
bankruptcy, insolvency, reorganization, arrangement, readjustment of debt,
dissolution, custodianship, conservatorship, liquidation, rehabilitation or
similar proceedings relating to it or to all or any part of its property under
the laws of any jurisdiction; or any similar proceeding is instituted without
the consent of Maker, as the case may be, and continues undismissed or unstayed
for thirty (30) calendar days; or any judgment, writ, attachment, execution or
similar process is issued or levied against all or any part of the Property or
Maker, and is not released, vacated or fully bonded within thirty (30) calendar
days after such issue or levy; or

                  (e) there shall occur a material adverse change in the
financial condition of

                                       -3-

<PAGE>

Maker from its financial condition as of the date of this Note, as determined 
by Holder in its reasonable discretion.

         10. INDEMNIFICATION. Maker hereby acknowledges that Lender has pledged
shares of Saxton Incorporated common stock (the "Certificates") as collateral
for a personal loan, the proceeds of which Lender is using to fund this Note.
Maker further acknowledges that if all or part of the Certificates were
negotiated for any reason by the financial institution holding the Certificates
during the pledge period, Lender would suffer irreparable harm for which
compensatory damages would be an inadequate remedy. Accordingly, Maker hereby
agrees that in the event Lender suffers such irreparable harm, Maker shall make
Lender whole by whatever means necessary including, but not limited to the
replacement of the negotiated Certificates with equivalent stock certificates
for Saxton Incorporated common stock.

         11. USURY. Maker hereby represents that this loan is for commercial use
and not for personal, family or household purposes. It is the specific intent of
the Maker and Lender that this Note bear a lawful rate of interest, and if any
court of competent jurisdiction should determine that the rate herein provided
for exceeds that which is statutorily permitted for the type of transaction
evidenced hereby, the interest rate shall be reduced to the highest rate
permitted by applicable law, with any excess interest theretofore collected
being applied against principal or, if such principal has been fully repaid,
returned to Maker upon written demand.

         12. NOTICES. Any and all notices, demands and/or communications
described herein, or which may be necessary or appropriate hereunder, shall be
valid if delivered personally, or if deposited in the U.S. mail, postage
prepaid, certified mail, return receipt requested, to the following addresses:

            If to Maker:
                                    Saxton Incorporated
                                    5440 West Sahara Avenue, Third Floor
                                    Las Vegas, Nevada  89146

           If to Lender:
                                    James C. Saxton
                                    5440 West Sahara Avenue, Third Floor
                                    Las Vegas, Nevada  89146

         Any notice, demand or communication deposited in the U.S. mail as
aforesaid shall be deemed received on the earlier of three (3) business days
after deposit in the U.S. mail, or upon actual receipt.

         13. ASSIGNMENT BY LENDER. Lender may assign its rights hereunder or
obtain participants in this Note at any time, and any such assignee, successor
or participant shall have all rights of the Lender hereunder.

                                       -4-

<PAGE>

         14. MULTIPLE PARTIES. A default on the part of any one entity
comprising Maker of this Note shall be deemed a default on the part of Maker
hereunder.

         15. WAIVERS. Maker hereby waives presentment, demand of payment, notice
of dishonor, protest, and notice of nonpayment, and any and all other notices
and demands whatsoever. No covenant, conditions, right or remedy in this Note
may be waived or modified orally, by course of conduct or previous acceptance or
otherwise unless such waiver or modification is specifically agreed to in
writing executed by the Lender.

         16. CONSTRUCTION. This Note shall be governed by and construed in
accordance with the laws of the State of Nevada, and all sums referred to herein
shall be calculated by reference to and payable in the lawful currency of the
United States. The titles and captions in this Note are inserted for convenience
only and in no way define, limit, extend, or modify the scope of intent of this
Note.

         17. PARTIAL INVALIDITY. If any section of provision of this Note is
declared invalid or unenforceable by any court of competent jurisdiction, said
determination shall not affect the validity or enforceability of the remaining
terms hereof. No such determination in one jurisdiction shall affect any
provision of this Note to the extent it is otherwise enforceable under the laws
of any other applicable jurisdiction.

         18. VENUE. The venue of any action brought in connection with this Note
shall be Clark County, Nevada.

                                 "MAKER":
                                 SAXTON INCORPORATED, a Nevada corporation



                                      By: 
                                          --------------------------
                                          James C. Saxton, President

                                       -5-