ex10_3.htm


  
    Exhibit 10.3

     

    
       NOTICE
OF CONFIDENTIALITY RIGHTS

      IF
YOU ARE A NATURAL PERSON, YOU MAY REMOVE OR STRIKE ANY OF THE 

      FOLLOWING
INFORMATION FROM THIS INSTRUMENT BEFORE IT IS FILED 

      FOR
RECORD IN THE PUBLIC RECORDS: YOUR SOCIAL SECURITY NUMBER 

      OR
YOUR DRIVER'S LICENSE NUMBER.

      


      DEED OF
TRUST

      (WITH
SECURITY AGREEMENT, FINANCING STATEMENT

      AND
ASSIGNMENT OF RENTS AND LEASES)

      


      


      This
Deed of Trust (with
Security Agreement, Financing Statement and Assignment of Rents and Leases) is
made on the date stated below by and between the Grantor, Beneficiary and
Trustee who are identified and whose addresses are stated below.

      


      


      
        
          	
                  Date:

                	
                  _________________ ___, 2009

                
	 
      	 
      
	
                  Grantor:

                	
                  WILSON
      FAMILY COMMUNITIES, INC.

                
	
                  Address:

                	
                  8121
      BEE CAVES ROAD, SUITE 100

                
	 
      	
                  AUSTIN,
      TEXAS 78746

                
	 
      	 
      
	
                  Beneficiary:

                	
                  LNZCO,
      LLC

                
	
                  Address:

                	
                  11612
      BEE CAVES ROAD, SUITE 260

                
	 
      	
                  AUSTIN,
      TEXAS 78738

                
	 
      	 
      
	
                  Trustee:

                	
                  A.
      RICK HIGHTOWER

                
	
                  Address:

                	
                  3006
      BEE CAVES ROAD, D-200

                
	 
      	
                  AUSTIN,
      TEXAS 78746

                
	 
      	 
      
	
                  Note:

                	
                  Obligations
      to Beneficiary under that certain Promissory Note dated even date
      herewith, in the original principal amount of $[_____] executed by Grantor
      (“Borrower”) and payable as stated in the Note.

                
	 
      	 
      
	
                  Land:

                	
                  [Insert
      lot description]

                


        

      

      


      


      ARTICLE
I

      SECURITY

      1.01  Conveyance in
Trust.  For value received, the receipt and sufficiency of
which Grantor acknowledges, and to secure the payment of the Indebtedness
described in Section 2.01 and performance of the covenants and agreements of
Grantor stated in this Deed of Trust and in the Loan Documents (as hereafter
defined), Grantor conveys the Property described in Section 1.02, including
without limitation the Land, to the Trustee in trust, with power of sale, TO
HAVE AND TO HOLD the Property, together with the rights, privileges, and
appurtenances thereto belonging unto the Trustee and the Trustee's substitutes
or successors forever.  Grantor binds itself and its heirs, executors,
administrators, personal representatives, successors, and assigns to WARRANT AND
FOREVER DEFEND the Property unto the Trustee, and the Trustee's substitutes or
successors and assigns, against the claim or claims of all persons claiming or
to claim the same or any part thereof.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      


      1.02  Property.  The
Property covered by this Deed of Trust includes the Land and the following items
described in this Section 1.02, whether now owned or hereafter acquired, all of
which, including replacements and additions thereto, shall be deemed to be and
remain a part of the Property covered by this Deed of Trust, and all rights,
hereditaments and appurtenances pertaining thereto, all of which are referred to
as the "Property":

      


      (a)           Any
and all buildings, improvements, and tenements now or hereafter attached to or
placed, erected, constructed, or developed on the Land (the
"Improvements");

      


      (b)           all
equipment, fixtures, furnishings, inventory, and articles of personal property
(the "Personal Property") now or hereafter attached to or used in or about the
Improvements or that are necessary or useful for the complete and comfortable
use and occupancy of the Improvements for the purposes for which they were or
are to be attached, placed, erected, constructed or developed, or which Personal
Property is or may be used in or related to the planning, development, financing
or operation of the Improvements, and all renewals of or replacements or
substitutions for any of the foregoing, whether or not the same are or shall be
attached to the Land or Improvements;

      


      (c)           all
water and water rights, timber, crops, and mineral interests pertaining to the
Land;

      


      (d)           all
building materials and equipment now or hereafter delivered to and intended to
be installed in or on the Land or the Improvements;

      


      (e)           all
plans and specifications for the Improvements;

      


      (f)           all
Grantor's rights (but not Grantor's obligations) under any contracts relating to
the Land, the Improvements or the Personal Property;

      


      (g)           all
deposits (including tenant security deposits), bank accounts, funds,
instruments, notes or chattel paper arising from or by virtue of any
transactions related to the Land, the Improvements or the Personal
Property;

      


      (h)           all
Grantor's rights (but not Grantor's obligations) under any documents, contract
rights, accounts, commitments, construction contracts, architectural contracts,
engineering contracts, and general intangibles (including without limitation
trademarks, trade names, and symbols) arising from or by virtue of any
transactions related to the Land, the Improvements, or the Personal
Property;

      


      (i)           all
permits, licenses, franchises, certificates, and other rights and privileges
obtained in connection with the Land, the Improvements, or the Personal
Property;

      


      (j)           all
proceeds arising from or by virtue of the sale, lease or other disposition of
the Land, the Improvements, or the Personal Property;

      


      (k)           all
proceeds (including premium refunds) of each policy of insurance relating to the
Land, the Improvements, or the Personal Property;

      


      (l)           all
proceeds from the taking of any of the Land, the Improvements, the Personal
Property or any rights appurtenant thereto by right of eminent domain or by
private or other purchase in lieu thereof, including change of grade of streets,
curb cuts or other rights of access, for any public or quasi-public use under
any law;

      


      (m)           all
right, title, and interest of Grantor in and to all streets, roads, public
places, easements, and rights-of-way, existing or proposed, public or private,
adjacent to or used in connection with, belonging or pertaining to the
Land;

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      


      (n)           all
rents, royalties, bonuses, issues, profits, revenues, or other benefits of the
Land or the Improvements or the Personal Property;

      


      (o)           all
consumer goods located in, on, or about the Land or the Improvements or used in
connection with the use or operation thereof; however, neither the term
"consumer goods" nor the term "Personal Property" includes clothing, furniture,
appliances, linens, china, crockery, kitchenware, or personal effects used
primarily for personal, family, or household purposes.

      


      (p)           all
entitlements in any way related to the Land, including, but not limited to (i)
all utility rights, taps, capacity, service, connections, availability, living
unit equivalents, and benefits which are appurtenant to, allocable to, allocated
to, or otherwise accruing to the Property, including but not limited to, all
rights and interests of Assignor, if any, in and to all rights to receive, use,
attach to, connect to, operate or otherwise enjoy the benefits of utilities and
utility services, connect to utilities, sell or assign excess capacity or
capacity rights, realize on utility or capacity values, recover or receive any
sums associated with or to those utility rights, all whether arising by way of
contractual, common law, statutory, ordinance, zoning, appurtenant, or other
means, (ii) all deposits, prepaid tap fees, prepaid capacity fees, allocated
recovery sums and all other rights to receive any refund, rebate, recovery or
allocation relating to utilities, and (iii) all plats, plat approvals, plat
surveys, declarations, declarant rights, condominium regimes, and other rights,
documents, approvals, consents, licenses and other rights relating to the use
and/or development of the Land;

      


      (q)           other
interests of every kind and character that Grantor now has or at any time
hereafter acquires in and to the Land, Improvements, and Personal Property and
all property that is used or useful in connection therewith, including rights of
ingress and egress and all reversionary rights or interests of Grantor with
respect to such property; and

      


      (r)           all
products and proceeds of the Personal Property described in this Section
1.02.

      


      1.03  Subrogation.  Any
of the proceeds of the Note utilized to take up any outstanding liens against
all or any part of the Property have been advanced by Beneficiary at Grantor's
request and upon Grantor's representation that such amounts are due and are
secured by valid liens against the Property.  Beneficiary shall be
subrogated to any and all rights, powers, superior titles, liens, and equities
owned or claimed by any owner or holder of any outstanding liens and debts,
however remote, regardless of whether said liens or debts are acquired by
Beneficiary by assignment or are released by the holder thereof upon
payment.

      


      


      ARTICLE
II

      INDEBTEDNESS AND
PAYMENTS

      


      2.01  Indebtedness.  The
indebtedness secured by this Deed of Trust (the "Indebtedness") shall mean and
include the following:

      


      (a)           Any
and all sums becoming due and payable pursuant to the Note;

      


      (b)           Any
and all other sums becoming due and payable by Grantor to Beneficiary as a
result of advancements made by Beneficiary pursuant to the terms and conditions
of this Deed of Trust or any other Loan Documents securing or executed in
connection with or otherwise relating to the Note, including without limitation
the repayment of any future advances made by Beneficiary to Grantor, as provided
in paragraph (c) below and the repayment of any sums advanced for the protection
of Beneficiary's security pursuant to Section 4.21;

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      


      (c) all
other indebtedness and obligations, fixed or contingent, whether arising by
notes, guaranties, discounts, overdrafts, or in any other manner, which Grantor
or Borrower may now or at any time hereafter owe Beneficiary, whether or not
related to the Note; and

      


      (d)           Any
and all renewals, extensions, replacements, rearrangements, substitutions, or
modifications of the Indebtedness, or any part of the Indebtedness.

      


      2.02  Other Loan
Documents.  In addition to this Deed of Trust and the Note,
Grantor, or Beneficiary may execute various other documents and agreements
relating to the Indebtedness secured by this Deed of Trust, including a loan
agreement relating to the disbursement and use of the proceeds of the Note (the
"Loan Agreement"), all of which documents and agreements, including the Loan
Agreement, are referred to herein as the "Loan Documents."  This Deed
of Trust shall also secure the performance of all obligations and covenants of
Grantor or other obligor under this Deed of Trust, the Loan Agreement, and the
other Loan Documents.

      


      2.03  Payment of Principal and
Interest.  Grantor shall, or shall cause Borrower to, promptly
pay when due the principal of and interest on the indebtedness evidenced by the
Note, any prepayment and late charges provided in the Note, and all other sums
secured by this Deed of Trust.

      


      2.04  Application of
Payments.  Unless applicable law provides otherwise, all
payments received by Beneficiary under the Note or this Deed of Trust shall be
applied by Beneficiary in accordance with Section 6.07.

      


      2.05  Guarantor.  The
term "Guarantor" shall include any person, company or entity obligated to pay or
guaranteeing collection of all or any portion of the Indebtedness, directly or
indirectly.

      


      


      ARTICLE
III

      SECURITY
AGREEMENT

      


      3.01  Uniform Commercial Code
Security Agreement.  This Deed of Trust is also intended to be
a security agreement between Grantor, as debtor, and Beneficiary, as secured
party, pursuant to the Texas Uniform Commercial Code [Texas Business and
Commerce Code Section 1.101, et seq. ("Texas UCC") for any of the items
specified above as part of the Property which, under applicable law, may be
subject to a security interest pursuant to the Texas UCC, and Grantor hereby
grants Beneficiary a security interest in all such items.  Grantor
agrees that Beneficiary may file this Deed of Trust, or a reproduction thereof,
in the real estate records or other appropriate index, as a financing statement
for any of the items specified above as part of the Property.  Any
reproduction of this Deed of Trust or of any other security agreement or
financing statement shall be sufficient as a financing statement.  In
addition, Grantor agrees to execute and deliver to Beneficiary, upon
Beneficiary's request, any financing statement, as well as extensions, renewals,
and amendments thereof, and reproduction of this Deed of Trust in such form as
Beneficiary may require to perfect a security interest with respect to said
items.  Grantor shall pay all costs of filing such financing statement
and any extensions, renewals, amendments, and releases thereof and shall pay all
reasonable costs and expenses of any record searches for financing statements
Beneficiary may reasonable require.  Without the prior written consent
of Beneficiary, Grantor shall not create or suffer to be created pursuant to the
Texas UCC any other security interest in said items, including replacements and
additions thereto.  Upon the occurrence of an Event of default (as
that term is defined in Article V below), including the covenants to pay when
due all sums secured by this Deed of Trust, Beneficiary shall have the remedies
of a secured party under the Texas UCC and, at Beneficiary's option, may also
invoke the remedies provided in Article VI of this Deed of Trust as to such
items.  In exercising any remedies, Beneficiary may proceed against
the items of real property and any items of personal property specified above as
part of the Property separately or together and in any order whatsoever, without
in any way affecting the availability of Beneficiary's remedies under the Texas
UCC or of the remedies provided in Article VI of this Deed of
Trust.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      


      3.02  Notice of
Changes.  Grantor shall give advance notice in writing to
Beneficiary of any proposed change in Grantor's name, identity, or structure and
shall execute and deliver to Beneficiary, prior to or concurrently with the
occurrence of any such change, all additional financing statements that
Beneficiary may require to establish and maintain the validity and priority of
Beneficiary's security interest with respect to any of the
Property.

      


      3.03  Fixtures.  Some
of the items of the Property are goods that are or are to become fixtures,
related to the Land.  Grantor and Beneficiary intend that, as to those
goods, this Deed of Trust shall be effective as a financing statement filed as a
fixture filing from the date of its filing for record in the real estate records
of the county in which the Property is situated.  Information
concerning the security interest created by this Deed of Trust may be obtained
from Beneficiary, as secured party, at the address of Beneficiary stated
above.  The mailing address of the Grantor, as debtor, is as stated
above.

      


      


      ARTICLE
IV

      BORROWER'S
REPRESENTATIONS, WARRANTIES,

      COVENANTS, AND
AGREEMENTS

      


      Grantor
covenants, warrants, and represents to and agrees with Beneficiary as
follows:

      


      4.01  Payment and
Performance.  Grantor shall, or shall cause Borrower to, make
all payments on the Indebtedness when due and shall punctually and properly
perform all of Grantor's covenants, obligations and liabilities under this Deed
of Trust and the other Loan Documents.

      


      4.02  Title to Property and Liens
of This Instrument.  Grantor has good and indefeasible title to
the Land and the Improvements, and good and marketable title to the Personal
Property, free and clear of any liens, charges, encumbrances, security
interests, and adverse claims whatsoever, except as otherwise provided
herein.  If the interest of Beneficiary in the Property or any part
thereof shall be endangered or shall be attacked, directly or indirectly,
Grantor authorizes Beneficiary, at Grantor's expense, to take all necessary and
proper steps for the defense of such interest, including the employment of
attorneys, the prosecution or defense of litigation, and the compromise or
discharge of claims made against such interest.

      


      4.03  Existence of
Borrower.  Grantor shall and shall cause Borrower to, preserve
and keep in full force and effect its existence, rights, franchises, and trade
names.

      


      4.04  Title
Insurance.  Grantor shall, at its sole cost and expense, obtain
and maintain mortgagee title insurance (in the form of a commitment, binder, or
policy as Beneficiary may require) in form reasonably acceptable to Beneficiary
in an amount equal to the amount of the Note.

      


      4.05  Taxes and
Assessments.  Grantor shall pay all taxes and assessments
against or affecting the Property as the same become due and payable, and, upon
request by Beneficiary, Grantor shall deliver to Beneficiary such evidence of
the payment thereof no later than MAY 31 of each year, or as Beneficiary may
otherwise require or request.  If Grantor fails to do so, Beneficiary
may pay them, together with all costs and penalties thereon, at Grantor's
expense; provided, however, that Grantor may in good faith, in lieu of paying
such taxes and assessments as they come due and payable, by appropriate
proceedings, contest their validity.  Pending such contest, Grantor
shall not be deemed in default under this Deed of Trust because of such
nonpayment if:  (a) prior to delinquency of the asserted tax or
assessment, Grantor furnishes Beneficiary an indemnity bond secured by a deposit
in cash or other security acceptable to Beneficiary, or with a surety acceptable
to Beneficiary, in the amount of the tax or assessment being contested by
Grantor plus a reasonable additional sum to pay all costs, interest and
penalties that may be imposed or incurred in connection therewith, conditioned
that such tax or assessment, with interest, cost and penalties, be paid as
herein stipulated; and (b) Grantor promptly pays any amount adjudged by a court
of competent jurisdiction to be due, with all costs, penalties and interest
thereon, on or before the date such judgment becomes final.  In any
event, the tax, assessment, penalties, interest, and costs shall be paid prior
to the date on which any writ or order is issued under which the Property or any
part of the Property may be sold in satisfaction thereof.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      


      4.06           Insurance.  Grantor
shall, at its sole cost and expense, obtain and maintain insurance upon and
relating to all insurable Property by all-risk insurance policies and, if
requested by Beneficiary, shall include perils of collapse, flood, and
earthquake, as well as other insurance coverages, all in form and in companies
acceptable to Beneficiary, in amounts equal to 100% of the replacement cost of
the Improvements during the construction thereof and at least 100% of the
replacement cost of the Improvements not under construction, or in such
additional amounts as Beneficiary may require, with loss made payable to
Beneficiary and with a standard form mortgage clause.  All proceeds
payable upon a loss shall be used to pay the Indebtedness.  Grantor
shall deliver the policies of insurance to Beneficiary promptly as issued; and,
if Grantor fails to do so, Beneficiary, at its option, may procure such
insurance at Grantor's expense.  All renewal and substitute policies
of insurance shall be delivered at the office of Beneficiary, premiums paid, at
least ten (10) days before the termination of such policy(ies).  In
case of loss, Beneficiary, at its option, shall be entitled to receive and
retain the proceeds of the insurance policies, applying the same to payment of
the Indebtedness in such order and manner as Beneficiary, in its sole
discretion, may elect.   If any loss shall occur at any time when
Grantor shall be in default hereof, Beneficiary shall be entitled to the benefit
of all insurance held by or for any Grantor, to the same extent as if it had
been made payable to Beneficiary, and upon foreclosure hereunder Beneficiary
shall become the owner thereof.

      


      


      4.08  Condemnation. (a)
Grantor assigns to Beneficiary all judgments, decrees, and awards for injury or
damage, direct or consequential, to the Property, and all awards pursuant to
proceedings for condemnation or other taking, whether direct or indirect, of the
Property or any part of the Property.  Beneficiary may apply any
condemnation proceeds to the Indebtedness in such manner as Beneficiary may
elect.  Grantor shall promptly notify Beneficiary of any action or
proceeding (or threatened action or proceeding) relating to any condemnation or
other taking, whether direct or indirect, of all or any part of the
Property.  Grantor shall, unless otherwise directed by Beneficiary in
writing, file or defend its claim under any such action and prosecute same with
due diligence to its final disposition and shall cause any awards or settlements
to be paid over to Beneficiary for disposition pursuant to the terms of this
Deed of Trust.  Grantor authorizes Beneficiary, at Beneficiary's
option, as attorney-in-fact for Grantor, to commence, appear in, and prosecute,
in Beneficiary's or Grantor's name, any action or proceeding relating to any
condemnation or other taking of the Property, whether direct or indirect, and to
settle or compromise any claim in connection with such condemnation or other
taking.  The proceeds of any award, payment, or claim for damages,
direct or consequential, in connection with any condemnation or other taking,
whether direct or indirect, of the Property, or part thereof, or for conveyances
in lieu of condemnation, are hereby assigned to and shall be paid to
Beneficiary.  Beneficiary shall be entitled to participate in,
control, and be represented by attorneys of Beneficiary's own choice in any such
action.  Grantor shall deliver, or cause to be delivered, to
Beneficiary such instruments as may be requested by it from time to time to
permit such participation.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      


      (b)           Grantor
authorizes Beneficiary to apply such awards, payments, proceeds, or damages,
after the deduction of Beneficiary's expenses incurred in the collection of such
amounts, at Beneficiary's option, to restoration or repair of the Property, or
to payment of the sums secured by this Deed of Trust, whether or not then due,
in the order of application set forth in Section 2.04, with the balance, if any,
to Grantor or Borrower.  Unless Grantor and Beneficiary otherwise
agree in writing, any application of proceeds to principal shall not extend or
postpone the due date of the installments referred to in Sections 2.03 and 4.06
or change the amount of such installments.  Grantor agrees to execute
such further evidence of assignment of any awards, proceeds, damages, or claims
arising in connection with such condemnation or taking as Beneficiary may
require.

      


      


      4.09  Taxes on Note or
Instrument.  If at any time any law shall be enacted imposing
or authorizing the imposition of any tax upon this Deed of Trust, or upon any
rights, titles, liens, or security interests created by this Deed of Trust, or
upon the Note, or any part of the Indebtedness, Grantor shall immediately pay
all such taxes; provided that, if it is unlawful for Grantor to pay such taxes,
Grantor shall prepay the Note in full without penalty within ninety (90) days
after demand therefore by Beneficiary.

      


      4.10  Statements by
Borrower.  At the request of Beneficiary, Grantor shall furnish
promptly a written statement or affidavit, in such form as may be required by
Beneficiary, stating the unpaid balance of the Note, the date to which interest
has been paid and that there are no offsets or defenses against full payment of
the Note and performance of the terms of the Loan Documents, or, if there are
any such offsets or defenses, specifying them.

      


      4.11  Repair, Waste, Alterations,
Etc.,  Grantor shall keep every part of the Property in good
operating order, repair, and condition and shall not commit or permit any waste
thereof.  Grantor shall make promptly all repairs, renewals, and
replacements necessary to such end.  Grantor shall discharge all
claims for labor performed and material furnished therefore, and shall not
suffer any lien of mechanics or materialmen to attach to any part of the
Property.  Grantor shall have the right to contest in good faith the
validity of any such mechanic's or materialman's lien, provided Grantor shall
first furnish Beneficiary a bond or other security satisfactory to Beneficiary
in such amount as Beneficiary shall reasonably require, but not more than two
hundred percent (200%) of the amount of the claim, and provided further that
Grantor shall thereafter diligently proceed to cause such lien to be removed and
discharged.  If Grantor shall fail to discharge any such lien, then,
in addition to any other right or remedy of Beneficiary, Beneficiary may, but
shall not be obligated to, discharge the lien, either by paying the amount
claimed to be due, or by procuring the discharge of such lien by depositing in
court a bond for the amount claimed, or otherwise giving security for such
claim, or by taking such action as may be prescribed by law.  Grantor
shall guard every part of the Property from removal, destruction, and damage,
and shall not do or suffer to be done any act whereby the value of any part of
the Property may be lessened; provided, nothing herein is intended to limit
Grantor’s right to develop the Property in accordance with the plans as set
forth in the Loan Agreement between the parties.

      


      4.12  No Drilling or
Exploration.  Without the prior written consent of Beneficiary,
there shall be no drilling or exploring for or extraction, removal, or
production of minerals from the surface or subsurface of the
Land.  The term "minerals" as used in this Deed of Trust shall include
without limitation oil, gas, casinghead gas, coal, lignite, hydrocarbons,
methane, carbon dioxide, helium, uranium and all other natural elements,
compounds and substances, including sand and gravel.

      


      4.13  Compliance with
Laws.  Grantor, the Property, and Grantor's use of the Property
shall comply with all laws, rules, ordinances, regulations, covenants,
conditions, restrictions, orders and decrees of any governmental authority or
court applicable to Grantor or the Property and its use, and Grantor shall pay
all fees or charges of any kind in connection therewith.  Grantor
shall not initiate, participate in, or acquiesce in a change in the zoning
classification of the Property without Beneficiary's prior written consent;
provided, nothing herein is intended to limit Grantor’s right to develop the
Property in accordance with the plans as set forth in the Loan Agreement between
the parties as a single family residence.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      


      4.14  Income, Expense and
Financial Statements.  Grantor shall keep and maintain at all
times at Grantor's address stated in this Deed of Trust, or such other place as
Beneficiary may approve in writing, complete and accurate books of accounts and
records adequate to reflect correctly the results of the operation of the
Property and copies of all written contracts, leases, and other instruments
which affect the Property.  Such books, records, contracts, leases,
and other instruments shall be subject to examination and inspection at any
reasonable time by Beneficiary.  At least once each year, and at such
other times as Beneficiary may request, Grantor shall deliver or cause to be
delivered to Beneficiary then current financial statements of Grantor and any
other party liable on all or any portion of the Indebtedness which shall include
a balance sheet, income statement and a statement of cash flows for the
preceding calendar year and pro forma financial statements for the current
calendar year.  All financial statements submitted pursuant to this
provision shall be in form and substance satisfactory to
Beneficiary.  All financial statements shall be certified as true and
correct by the party submitting such statement or, at Beneficiary's request if
an event of default has occurred, audited by an independent certified public
accountant.

      


      4.15  Hold
Harmless.  Grantor shall defend, at Grantor's own cost and
expense, and hold Beneficiary harmless from, any proceeding or claim in any way
relating to the Property or the Loan Documents.  All costs and
expenses incurred by Beneficiary in protecting its interests under this Deed of
Trust, including all court costs and reasonable attorneys' fees and expenses,
shall be borne by Grantor.  The provisions of this Section shall
survive the payment in full of the Indebtedness and the release of this Deed of
Trust as to events occurring and causes of action arising before such payment
and release.

      


      4.16  Further
Assurances.  Grantor, upon the reasonable request of
Beneficiary, shall execute, acknowledge, deliver, and record such further
instruments and do such further acts as may be necessary to carry out the
purposes of this Deed of Trust or the other Loan Documents and to subject to the
liens and security interests created by this Deed of Trust or the other Loan
Documents any property intended to be covered by this Deed of Trust and the
other Loan Documents pursuant to their terms, including without limitation any
renewals, additions, substitutions, replacements, improvements, or appurtenances
to the Property.

      


      4.17  Recording and
Filing.  Grantor shall cause this Deed of Trust and the other
recordable Loan Documents and all amendments, supplements, extensions, and
substitutions thereof to be recorded, filed, re-recorded, and refiled in such
manner and in such places as Beneficiary shall reasonably
request.  Grantor shall pay all such recording, filing, re-recording,
and refiling fees, title insurance premiums, and other charges.

      


      4.18  Payment of
Debts.  Grantor shall promptly pay when due all obligations
regarding the ownership and operation of the Property, except any such
obligations which are being diligently contested in good faith by appropriate
proceedings and as to which Grantor, if requested by Beneficiary, shall have
furnished to Beneficiary security reasonably satisfactory to
Beneficiary.

      


      4.19  Modification by Subsequent
Owners.  Grantor agrees that Grantor shall be bound by any
modification of this Deed of Trust or any of the other Loan Documents made by
Beneficiary and any subsequent owner of the Property, with or without notice to
such Grantor, and no such modifications shall impair the obligations of such
Grantor under this Deed of Trust or any other Loan Document.  Nothing
in this Section shall be construed as permitting any transfer of the Property
which would constitute an Event of Default under other provisions of this Deed
of Trust.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      


      4.20  Inspection.  Beneficiary
may make or cause to be made reasonable entries upon and inspections of the
Property.

      


      4.21  Protection of Lender's
Security. (a) If Grantor fails to perform the covenants and agreements
contained in this Deed of Trust, or if any action or proceeding is commenced
which affects the Property or title thereto or the interest of Beneficiary
therein, including without limitation eminent domain, insolvency, code
enforcement, or arrangements or proceedings involving a bankrupt or decedent,
then Beneficiary, at Beneficiary's option, may make such appearances, disburse
such sums and take such action as Beneficiary deems necessary, in its sole
discretion, to protect Beneficiary's interest.

      


      (b)           Any
amounts disbursed by Beneficiary pursuant to this Section 4.21, with interest
thereon, shall become additional indebtedness of Grantor secured by this Deed of
Trust.  Unless Grantor and Beneficiary agree to other terms of
payment, such amounts shall be immediately due and payable and shall bear
interest from the date of disbursement at the rate stated in the Note unless
collection from Grantor of interest at such rate would be contrary to applicable
law, in which event such amounts shall bear interest at the highest non-usurious
rate which may be collected from Grantor under applicable
law.  Grantor covenants and agrees that Beneficiary shall be
subrogated to the lien of any mortgage or other lien discharged, in whole or in
part, by the Indebtedness.  Nothing contained in this Section 4.21
shall require Beneficiary to incur any expense or take any action under this
Deed of Trust.

      


      4.22  Subordinate Deed of
Trust.  Grantor shall not, without the prior written consent of
Beneficiary, grant any lien, security interest, or other encumbrance (a
"Subordinate Deed of Trust") covering any of the Property.  If
Beneficiary consents to a Subordinate Deed of Trust or if the foregoing
prohibition is determined by a court of competent jurisdiction to be
unenforceable, any such Subordinate Deed of Trust shall contain express
covenants to the effect that:  (a) the Subordinate Deed of Trust is
unconditionally subordinate to this Deed of Trust; and (b) written notice of
default under the Subordinate Deed of Trust and written notice of the
commencement of any action (whether judicial or pursuant to a power of sale) to
foreclose or otherwise enforce the Subordinate Deed of Trust shall be given to
Beneficiary with or immediately after the occurrence of any such default or
commencement.

      


      4.23  Liens.  Grantor
shall promptly discharge any lien which has, or may have, priority over or
equality with, the lien of this Deed of Trust, and Grantor shall pay, when due,
the claims of all persons supplying labor or materials to or in connection with
the Property.  Without Beneficiary's prior written permission, Grantor
shall not allow any lien inferior to this Deed of Trust to be perfected against
the Property.

      


      4.24  Assignment of
Rents.  Grantor assigns to Beneficiary absolutely, not only as
collateral, all present and future rent and other income and receipts from the
Property.  Leases are not assigned.  Grantor warrants the
validity and enforceability of the assignment.  Grantor may as
Beneficiary's licensee collect rent and other income and receipts as long as
Grantor is not in default under the Note or this Deed of
Trust.  Grantor will apply all rent and other income and receipts to
payment of the Note and performance of this Deed of Trust, but if the rent and
other income and receipts exceed the amount due under the Note and Deed of
Trust, Grantor may retain the excess.  If Grantor defaults in payment
of the Note or in performance of this Deed of Trust, Beneficiary may terminate
Grantor's license to collect and then as Grantor's agent may rent the Property
if it is vacant and collect all rent and other income and
receipts.  Beneficiary neither has nor assumes any obligations as
lessor or landlord with respect to any occupant of the
Property.  Beneficiary may exercise Beneficiary's rights and remedies
under this Section without taking possession of the
Property.  Beneficiary shall apply all rent and other income and
receipts collected under this Section first to expenses incurred in exercising
Beneficiary's rights and remedies and then in accordance with Section
2.04.  Beneficiary is not required to act under this Section, and
acting under this Section does not waive any of Beneficiary's other rights and
remedies.  If Grantor becomes a voluntary or involuntary bankrupt,
Beneficiary's filing a proof of claim in bankruptcy will be tantamount to the
appointment of a receiver under Texas law.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      


      4.25  Organization and Power
(Corporate Borrower).  This Section is applicable if Grantor is
a corporation.  Grantor  (a) is a corporation duly
organized, validly existing under the laws of the state of its incorporation and
in good standing under the laws of the state of its incorporation and the laws
of the State of Texas, (b) has complied with all conditions prerequisite to its
lawfully doing business in the state where the Land is situated, and (c) has all
requisite corporate power and all governmental certificates of authority,
licenses, permits, qualifications, and documentation to own, lease, and operate
its properties and to carry on its business as now being, and as proposed to be,
conducted, and the execution of this Deed of Trust, the Note and any and all
other Loan Documents is within Grantor 's powers, has been duly authorized by
all requisite action, and is not in contravention of law or the Grantor 's
corporate charter.

      


      


      ARTICLE
V

      EVENTS OF
DEFAULT

      


      The
occurrence of any one of the following shall be a default under this Deed of
Trust and the Loan Documents ("Event of Default"):

      


      5.01  Failure to Pay
Indebtedness.  Any of the Indebtedness is not paid when due,
whether by acceleration or otherwise and any applicable grace period has
expired.

      


      5.02  Nonperformance of
Covenants.  Any covenant in this Deed of Trust or any of the
other Loan Documents is not fully and timely performed and such nonperformance
continues for 30 days after notice thereof from the Beneficiary or the
occurrence of any default or event of default under this Deed of Trust or any
other Loan Document.

      


      5.03  False
Representation.  Any statement, representation or warranty in
this Deed of Trust or any of the other Loan Documents, any financial statement,
or any other writing delivered to Beneficiary in connection with the
Indebtedness is false, misleading, or erroneous in any material respect when
made or given.

      


      5.04  Bankruptcy or
Insolvency.  The owner of the Property or any person obligated
to pay any part of the Indebtedness:

      


      (a)           does
not pay its debts as they become due or admits in writing its inability to pay
its debts or makes a general assignment for the benefit of creditors;
or

      


      (b)           commences
any case, proceeding, or other action seeking reorganization, arrangement,
adjustment, liquidation, dissolution, or composition of it or its debts under
any law relating to bankruptcy, insolvency, reorganization, or relief of
debtors; or

      


      (c)           in
any involuntary case, proceeding, or other action commenced against it which
seeks to have an order for relief entered against it, as debtor, or seeks
reorganization, arrangement, adjustment, liquidation, dissolution, or
composition of it or its debts under any law relating to bankruptcy, insolvency,
reorganization, or relief of debtors, (i) fails to obtain a dismissal of such
case, proceeding or other action within sixty (60) days of its commencement, or
(ii) converts the case from one chapter of the Federal Bankruptcy Code to
another chapter, or (iii) is the subject of an order for relief; or

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      


      (d)           conceals,
removes, or permits to be concealed or removed, any part of its property, with
intent to hinder, delay, or defraud its creditors or any of them, or makes or
suffers a transfer of any of its property which may be fraudulent under any
bankruptcy, fraudulent conveyance, or similar law; or makes any transfer of its
property to or for the benefit of a creditor at a time when other creditors
similarly situated have not been paid; or suffers or permits, while insolvent,
any creditor to obtain a lien upon any of its property through legal proceedings
which is not vacated within sixty (60) days from the date thereof;
or

      


      (e)           has
a trustee, receiver, custodian, or other similar official appointed for or take
possession of all or any part of the Property or any other of its property or
has any court take jurisdiction of any other of its property which remains
dismissed for a period of sixty (60) days (except where a shorter period is
specified in the immediately following paragraph (f)); or

      


      (f)           fails
to have discharged within a period of ten (10) days any attachment,
sequestration, or similar writ levied upon any property of such person;
or

      


      (g)           fails
to pay immediately any final money judgment against such person.

      


      5.05  Transfer of the
Property.  Title to all or any part of the Property (other than
obsolete or worn Personal Property replaced by adequate substitutes of equal or
greater value than the replaced items when new) shall become vested in any party
other than Grantor , whether by operation of law or
otherwise.  Beneficiary may, in its sole discretion, waive this Event
of Default, but it shall have no obligation to do so, and any waiver may be
conditioned upon such one or more of the following which Beneficiary may
require:  (a) the grantee's integrity, reputation, character,
creditworthiness, and management ability being satisfactory to Beneficiary in
its sole judgment; and (b) grantee executing, prior to such sale or transfer, a
written assumption agreement containing such terms as Beneficiary may require,
such as a principal paydown on the Note, an increase in the rate of interest
payable under the Note, a transfer fee, and any other modification of the Note,
this Deed of Trust or any of the other Loan Documents which Beneficiary may
require.

      


      5.06  Grant of Easement,
Etc.   Without the prior written consent of Beneficiary,
Grantor grants any easement or dedication, files any plat, condominium
declaration, or restriction, or otherwise encumbers the Property, unless such
action is expressly permitted by this Deed of Trust or any of the other Loan
Documents; provided, nothing herein is intended to limit Grantor’s right to
develop the Property in accordance with the plans as set forth in the Loan
Agreement between the parties for a single family residence.

      


      5.07  Abandonment.  Grantor
abandons or vacates any of the Property.

      


      5.08  Foreclosure of Other
Liens.  The holder of any lien, security interest or assignment
on the Property institutes foreclosure or other proceedings for the enforcement
of its remedies thereunder.

      


      


      ARTICLE
VI

      DEFAULT AND
REMEDIES

      


      6.01  Acceleration and Waiver of
Notices.  Subject to any notice and cure allowed under the Note
and Loan Agreement, upon the occurrence of an Event of Default, Beneficiary, at
Beneficiary's option, may declare all of the sums secured by this Deed of Trust
to be immediately due and payable without further demand and may invoke the
power of sale and any other remedies permitted by applicable law or provided
herein.  Grantor  acknowledges that the power of sale
granted to Beneficiary may be exercised by Beneficiary without prior judicial
hearing.  Grantor each Guarantor, surety, and endorser of all or any
part of the Indebtedness expressly waive all presentations for payment, notices
of intention to accelerate maturity, notices of acceleration of maturity,
notices of intention to demand payment, demands for payment, protests, and
notices of protest.  Grantor  and each Guarantor, surety,
and endorser acknowledge and understand that by these waivers they waive any
right they may have to receive notices of default under this Deed of Trust, the
Note, and the other Loan Documents, as well as any opportunity to cure any such
default.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      


      6.02  Notice of
Sale.  Notice of sale of all or part of the Property by the
Trustee shall be given by posting written notice thereof at the courthouse door
(or other area in the courthouse as may be designated for such public notices)
of the county in which the sale is to be made, and by filing a copy of the
notice in the office of the county clerk of the county in which the sale is to
be made, at least twenty-one (21) days preceding the date of the sale, and if
the Property to be sold is in more than one county a notice shall be posted at
the courthouse door (or other area in the courthouse as may be designated for
such public notices) and filed with the county clerk of each county in which the
Property to be sold is situated.  In addition, Beneficiary shall, at
least twenty-one (21) days preceding the date of sale, serve written notice of
the proposed sale by certified mail on Grantor  and each debtor
obligated to pay the Indebtedness secured hereby according to the records of
Beneficiary.  Service of such notice shall be completed upon deposit
of the notice, enclosed in a postpaid wrapper, properly addressed to such debtor
at the most recent address as shown by the records of Beneficiary, in a post
office or official depository under the care and custody of the United States
Postal Service.  The affidavit of any person having knowledge of the
facts to the effect that such service was completed shall be prima facie
evidence of the fact of service.  Any notice that is required or
permitted to be given to Grantor  may be addressed to
Grantor  at Grantor 's address as stated in this Deed of
Trust.  Any notice that is to be given by certified mail to any other
debtor may, if no address for such other debtor is shown by the records of
Beneficiary, be addressed to such other debtor at the address of
Grantor  as is shown by the records of
Beneficiary.  Notwithstanding the foregoing provisions of this
Section, notice of such sale given in accordance with the requirements of the
applicable laws of the State of Texas in effect at the time of such sale shall
constitute sufficient notice of such sale.

      


      6.03  Trustee's
Sale.  Beneficiary may require the Trustee to sell all or part
of the Property, at public auction, to the highest bidder, for cash, at the
county courthouse of the county in Texas in which the Property or any part
thereof is situated, or if the Property is located in more than one county such
sale or sales may be made at the courthouse in any county in which the Property
is situated.  All sales shall take place at such area of the
courthouse as shall be properly designated from time to time by the
commissioners court (or, if not so designated by the commissioners court, at
such other area in the courthouse as may be provided in the notice of sale
hereinafter described) of the specified county, between the hours of 10:00
o'clock a.m. and 4:00 o'clock p.m. (the commencement of such sale to occur
within three hours following the time designated in the above described notice
of sale as the earliest time at which such sale shall occur, if required by
applicable law) on the first Tuesday of any month, after giving notice of the
time, place and terms of said sale (including the earliest time at which such
sale shall occur) and of the Property to be sold in the manner hereinafter
described.  Trustee may sell all or any portion of the Property,
together or in lots or parcels.  In no event shall Trustee be required
to exhibit, present or display at any such sale any of the Personal Property
described herein to be sold at such sale.  Beneficiary may bid and
become the purchaser of all or any part of the Property at any trustee's or
foreclosure sale hereunder, and the amount of Beneficiary's successful bid may
be credited on the Indebtedness.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      


      6.04  Partial
Sales.  The sale by Trustee of less than the whole of the
Property shall not exhaust the power of sale herein granted, and Trustee is
specifically empowered to make successive sales under such power until the whole
of the Property shall be sold; and if the proceeds of such sale of less than the
whole of the Property shall be less than the aggregate of the Indebtedness and
the expenses thereof, this Deed of Trust and the lien, security interest and
assignment hereof shall remain in full force and effect as to the unsold portion
of the Property just as though no sale had been made; provided, however, that
Grantor shall never have any right to require the sale of less than the whole of
the Property, but Beneficiary shall have the right, at its sole election, to
request Trustee to sell less than the whole of the Property.  If there
is a default on the payment of any installment on the Note or any portion of the
Indebtedness, and Beneficiary elects not to accelerate the unpaid balance of the
Note or Indebtedness, Beneficiary shall have the option to proceed with
foreclosure in satisfaction of such unpaid installment or other amount either
through judicial proceedings or by directing Trustee to proceed as if under a
full foreclosure, conducting the sale as herein provided without declaring the
entire Indebtedness due.  It is agreed that such sale, if so made,
shall not in any manner affect the unmatured part of the Indebtedness, but as to
such unmatured part this Deed of Trust shall remain in full force and effect as
though no sale had been made under the provisions of this
Section.  Several sales may be made hereunder without exhausting the
right of sale for any unmatured part of the Indebtedness.

      


      6.05  Foreclosure of all
Property.  The Land, Improvements, and Personal Property may be
sold in one or more public sales pursuant to Texas Property Code Section 51.002
and Texas UCC Section 9.610.  Grantor and all persons obligated to pay
the Indebtedness agree that notice of sale of the Property provided pursuant to
Section 6.02 above and pursuant to Texas Property Code Section 51.002 is and
shall constitute commercially reasonable notice of the sale of the Property or
any part of the Property.  Beneficiary shall also be entitled to
foreclose its security interests against the Personal Property in accordance
with any other rights and remedies Beneficiary may have as a secured party under
the Texas UCC.

      


      6.06  Trustee's
Deed.  Trustee shall deliver to the purchaser a Trustee's deed
and such other assignments and documents of transfer and sale as Trustee may
deem necessary conveying the Property so sold in fee simple with covenants of
general warranty.  Grantor covenants and agrees to defend generally
the purchaser's title to the Property against all claims and
demands.  At any such sale (a) Grantor hereby agrees, in its behalf
and in behalf of Grantor's heirs, executors, administrators, successors,
personal representatives and assigns, that any and all recitals made in any deed
of conveyance given by Trustee with respect to the identity of Beneficiary, the
occurrence or existence of any default, the acceleration of the maturity of any
of the Indebtedness, the request to sell, the notice of sale, the giving of
notice to all debtors legally entitled thereto, the time, place, terms and
manner of sale, and receipt, distribution and application of the money realized
therefrom, or the due and proper appointment of a substitute Trustee, and,
without being limited by the foregoing, with respect to any other act or thing
having been duly done by Beneficiary or by Trustee hereunder, shall be taken by
all courts of law and equity as prima facie evidence that the statements or
recitals state facts and are without further question to be so accepted, and
Grantor hereby ratifies and confirms every act that Trustee or any substitute
Trustee hereunder may lawfully do in the premises by virtue hereof, and (b) the
purchaser may disaffirm any easement granted, subdivision plat filed, or rental,
lease or other contract made in violation of any provision of this Deed of
Trust, and may take immediate possession of the Property free from, and despite
the terms of, such grant of easement, subdivision plat, or rental, lease or
other contract.

      


      6.07  Proceeds of
Sale.  Trustee shall apply the proceeds of the sale in the
following order:  (a) to all reasonable costs and expenses of the
sale, including but not limited to, reasonable Trustee's fees and attorney's
fees and costs of title evidence; (b) to all sums secured by this Deed of Trust
in such order as Beneficiary, in Beneficiary's sole discretion, directs; and (c)
the excess, if any, to the person or persons legally entitled
thereto.

      


      6.08  Possession After
Sale.  If the Property is sold pursuant to Section 6.03,
Grantor or any person holding possession of the Property through Grantor shall
immediately surrender possession of the Property to the purchaser at such sale
upon the purchaser's written demand.  If possession is not surrendered
upon the purchaser's written demand, Grantor or such person shall be a tenant at
sufferance and may be removed by writ of possession or by an action for forcible
entry and detainer.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      


      6.09  Costs and
Expenses.  Beneficiary shall be entitled to collect all costs
and expenses incurred in pursuing such remedies, including but not limited to,
attorney's fees and costs of documentary evidence, abstracts, and title
reports.

      


      6.10  Substitute
Trustee.  Beneficiary, at Beneficiary's option, with or without
cause, may from time to time remove Trustee and appoint a successor trustee to
any Trustee appointed hereunder without other formality than a designation in
writing.  Without conveyance of the Property, the successor trustee
shall succeed to all title, power, and duties conferred upon the Trustee by this
Deed of Trust and by applicable law.

      


      6.11  Remedies
Cumulative.  Each remedy provided in this Deed of Trust is
distinct and cumulative to all other rights or remedies under this Deed of Trust
or afforded by law or equity, and may be exercised concurrently, independently,
or successively, in any order whatsoever.

      


      6.12  Forbearance by Lender Not a
Waiver.  Any forbearance by Beneficiary in exercising any right
or remedy hereunder, or otherwise afforded by applicable law, shall not be a
waiver of or preclude the exercise of any right or remedy.  The
acceptance by Beneficiary of payment of any sum secured by this Deed of Trust
after the due date of such payment shall not be a waiver of Beneficiary's right
to either require prompt payment when due of all other sums so secured or to
declare a default for failure to make prompt payment.  The procurement
of insurance or the payment of taxes or other liens or charges by Beneficiary
shall not be a waiver of Beneficiary's right to accelerate the maturity of the
Indebtedness, nor shall Beneficiary's receipts of any awards, proceeds or
damages under Section 4 operate to cure or waive Grantor 's default in payment
of sums secured by this Deed of Trust.

      


      6.13 Waiver of
Marshalling.  Notwithstanding the existence of any other
security interests in the Property held by Beneficiary or by any other party,
Beneficiary shall have the right to determine the order in which any or all
portions of the Indebtedness are satisfied from the proceeds realized upon the
exercise of the remedies provided in this Article VI.  Grantor, any
party who consents to this Deed of Trust, and any party who now or hereafter
acquires a security interest in the Property and who has actual or constructive
notice of this Deed of Trust and Beneficiary's rights and interests under this
Deed of Trust, hereby waive any and all right to require the marshalling of
assets in connection with the exercise of any of the remedies permitted by
applicable law or provided by this Deed of Trust.

      


      ARTICLE
VII

      HAZARDOUS
MATERIALS

      


      7.01  Hazardous
Materials.  For the purposes of this Deed of Trust, Grantor,
Beneficiary and Trustee agree that, unless the context otherwise specifies or
requires, the following terms shall have the following meanings:

      


      (a)           "Hazardous
Materials" shall mean (i) any "hazardous waste" as defined by the Resource
Conservation and Recovery Act of 1976 (42 U.S.C. Section 6901 et seq.), as
amended from time to time, and regulations promulgated thereunder; (ii) any
"hazardous substance" as defined by the Comprehensive Environmental Response,
Compensation and Liability Act of 1980 (42 U.S.C. Section 9601 et seq.)
("CERCLA"), as amended from time to time, and regulations promulgated
thereunder; (iii) asbestos; (iv) polychlorinated biphenyls; (v) underground
storage tanks, whether empty, filled or partially filled with any substance,
(vi) any substance the presence of which on the Property is prohibited by any
applicable governmental requirements and regulations ("Governmental
Requirements"); and (vii) any other substance which by any Governmental
Requirements requires special handling or notification of any federal, state, or
local governmental entity in its collection, storage, treatment, or
disposal.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      


      (b)           "Hazardous
Materials Contamination" shall mean the contamination (whether presently
existing or hereafter occurring) of any improvements, facilities, soil,
groundwater, air or other elements on or of the Property by Hazardous Materials,
or the contamination of the buildings, facilities, soil, groundwater, air, or
other elements on or of any other property as a result of Hazardous Materials at
any time (whether before or after the date of this Deed of Trust) emanating from
the Property.

      


      7.02  Representations and
Warranties.  Grantor represents and warrants that:

      


      (a)           To
the best of Grantor’s knowledge, and other than as disclosed in any
environmental report delivered by Grantor to Beneficiary prior to the date
hereof, no Hazardous Materials are now located on the Property, and neither
Grantor nor, to Grantor's knowledge, any other person has ever caused or
permitted any Hazardous Materials to be placed, held, located, or disposed of
on, under, or at the Property or any part thereof in violation of the applicable
law;

      


      (b)           No
part of the Property is being used or, to the knowledge of Grantor, has been
used at any previous time for the disposal, storage, treatment, processing, or
other handling of Hazardous Materials in violation of the applicable law, nor is
any part of the Property affected by any Hazardous Materials
Contamination;

      


      (c)           To
the best of the Grantor's knowledge and belief, no property adjoining the
Property is being used, or has ever been used at any previous time, for the
disposal, storage, treatment, processing or other handling of Hazardous
Materials, nor is any other property adjoining the Property affected by
Hazardous Materials Contamination; and

      


      (d)           No
investigation, administrative order, consent order and agreement, litigation or
settlement with respect to Hazardous Materials or Hazardous Materials
Contamination is proposed, threatened, anticipated or in existence with respect
to the Property.  The Property is not currently on, and to Grantor's
knowledge, after diligent investigation and inquiry, has never been on, any
federal or state "Superfund" or "Superlien" list.

      


      7.03  Borrower's
Covenants.  Grantor agrees to (a) give notice to Beneficiary
immediately upon Grantor's acquiring knowledge of the presence of any Hazardous
Materials on the Property or of any Hazardous Materials Contamination with a
full description thereof; (b) promptly comply with any Governmental Requirements
requiring the removal, treatment or disposal of such Hazardous Materials or
Hazardous Materials Contamination and provide Beneficiary with satisfactory
evidence of such compliance; and (c) provide Beneficiary, within thirty (30)
days after demand by Beneficiary, with a bond, letter of credit or similar
financial assurance evidencing to Beneficiary's satisfaction that the necessary
funds are available to pay the cost of removing, treating and disposing of such
Hazardous Materials or Hazardous Materials Contamination and discharging any
assessments which may be established on the Property as a result
thereof.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      


      7.04  Site
Assessments.  Beneficiary (by its officers, employees and
agents) at any time and from time to time after the occurrence of an Event of
Default, may contract for the services of persons (the "Site Reviewers") to
perform environmental site assessments ("Site Assessments") on the Property for
the purpose of determining whether there exists on the Property any
environmental condition which could reasonably be expected to result in any
liability, cost, or expense to the owner, occupier or operator of such Property
arising under any state, federal or local law, rule or regulation relating to
Hazardous Materials.  The Site Assessments may be performed at any
time or times, upon reasonable notice, and under reasonable conditions
established by Grantor which do not impede the performance of the Site
Assessments.  The Site Reviewers are authorized to enter upon the
Property for such purposes.  The Site Reviewers are further authorized
to perform both above and below the ground testing for environmental damage or
the presence of Hazardous Materials on the Property and such other tests on the
Property as may be necessary to conduct the Site Assessments in the reasonable
opinion of the Site Reviewers.  Grantor will supply to the Site
Reviewers such historical and operational information regarding the Property as
may be reasonably requested by the Site Reviewers to facilitate the Site
Assessments and will make available for meetings with the Site Reviewers
appropriate personnel having knowledge of such matters.  On request,
Beneficiary shall make the results of such Site Assessments fully available to
Grantor, which may, at Grantor's election, participate under reasonable
procedures in the direction of such Site Assessments and the description of
tasks of the Site Reviewers.  The cost of performing such Site
Assessments shall be paid by Grantor upon demand of Beneficiary and any such
obligations shall be Indebtedness secured by this Deed of Trust.

      


      7.05  Indemnification.  Regardless
of whether any Site Assessments are conducted hereunder, if any Event of Default
shall have occurred and be continuing or any remedies in respect of the Property
are exercised by Beneficiary, Grantor shall defend, indemnify, and hold harmless
Beneficiary and Trustee from any and all liabilities (including strict
liability), actions, demands, penalties, losses, costs, or expenses (including
without limitation attorneys' fees and expenses, and remedial costs), suits,
costs of any settlement or judgment and claims of any and every kind whatsoever
which may now or in the future (whether before or after the release of this Deed
of Trust) be paid, incurred or suffered by or asserted against Beneficiary or
Trustee by any person or entity or governmental agency for, with respect to, or
as a direct or indirect result of, the presence on or under, or the escape,
seepage, leakage, spillage, discharge, emission or release from the Property of
any Hazardous Materials or any Hazardous Materials Contamination or arise out of
or result from the environmental condition of the Property or the applicability
of any Governmental Requirements relating to Hazardous Materials (including
without limitation CERCLA or any federal, state, or local so-called "Superfund"
or "Superlien" laws, statute, law, ordinance, code, rule, regulation, order of
decree), provided, however, that such indemnity shall not apply to matters
occurring after Benefiicary of Trustee acquires such Property through a
foreclosure sale or has  the Property.  The representations,
covenants, warranties, and indemnifications contained in this Article VII shall
survive the release of this Deed of Trust.

      


      7.06  Rights of
Lender.  Beneficiary shall have the right, but not the
obligation, prior or subsequent to an Event of Default, without in any way
limiting Beneficiary's other rights and remedies under this Deed of Trust, to
enter onto the Property or to take such other actions as it deems necessary or
advisable to clean up, remove, resolve, or minimize the impact of, or otherwise
deal with, any Hazardous Materials or Hazardous Materials Contamination on the
Property following receipt of any notice from any person or entity asserting the
existence of any Hazardous Materials or Hazardous Materials Contamination
pertaining to the Property or any part thereof which, if true, could reasonably
be expected to result in an order, suit, imposition of a lien on the Property,
or other action and/or which, in Beneficiary's sole opinion, could jeopardize
Beneficiary's security under this Deed of Trust.  All costs and
expenses paid or incurred by Beneficiary in the exercise of any such rights
shall be Indebtedness secured by this Deed of Trust and shall be payable by
Grantor upon demand.

      


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      


      ARTICLE
VIII

      MISCELLANEOUS
PROVISIONS

      


      8.01  Borrower and Lien Not
Released.  From time to time, Beneficiary may, at Beneficiary's
option, without giving notice to or obtaining the consent of Grantor , Grantor
's successors or assigns or any junior lienholder or Guarantor, without
liability on Beneficiary's part and notwithstanding the existence of an Event of
Default, extend the time for payment of the Indebtedness or any part thereof,
reduce the payments thereon, release anyone liable on any of the Indebtedness,
accept a renewal note or notes therefor, modify the terms and time of payment of
the Indebtedness, release from the liens of this Deed of Trust any part of the
Property, take or release other or additional security, reconvey any part of the
Property, consent to any map or plan of the Property, consent to the granting of
any easement, join in any extension or subordination agreement, and agree in
writing with Grantor to modify the rate of interest or period of amortization of
the Note or change the amount of the installments payable
thereunder.  Any actions taken by Beneficiary pursuant to the terms of
this Section 8.01 shall not affect the obligation of Grantor or Grantor 's
successors or assigns to pay the sums secured by this Deed of Trust and to
observe the covenants of Grantor contained herein, shall not affect the guaranty
of any person, corporation, partnership, or other entity for payment of the
Indebtedness or any part thereof, and shall not affect the liens or priority of
liens of this Deed of Trust on the Property.  Grantor shall pay
Beneficiary a reasonable charge, together with such title insurance premiums and
attorney's fees as may be incurred at Beneficiary's option, for any such action
if taken at Grantor 's request.

      


      8.02  Notice.  Except
for any notice required under applicable law to be given in another manner, (a)
any notice to Grantor provided for in this Deed of Trust or in the Note shall be
given by mailing such notice by United States mail, postage prepaid, addressed
to Grantor at Grantor 's address stated in this Deed of Trust or at such other
address as Grantor may designate by notice to Beneficiary as provided herein,
and (b) any notice to Beneficiary shall be given by United States mail, postage
prepaid, addressed to Beneficiary at Beneficiary's address stated in this Deed
of Trust or to such other address as Beneficiary may designate by notice to
Grantor as provided herein.  Any notice provided for in this Deed of
Trust or in the Note shall be deemed to have been given to Grantor or
Beneficiary when given in the manner designated herein, but actual notice,
however given or received, shall always be effective.

      


      8.03  Successors and Assigns
Bound.  The covenants and agreements herein contained shall
bind, and the rights hereunder shall inure to, the respective successors and
assigns of Beneficiary and Grantor subject to the provisions of Section
5.05.

      


      8.04  Joint and Several
Liability.  All covenants and agreements of Grantor shall be
joint and several.

      


      8.05  Agents.  In
exercising any rights hereunder or taking any actions provided for herein,
Beneficiary may act through its employees, agents or independent contractors as
authorized by Beneficiary.

      


      8.06  Governing
Law.  This Deed of Trust shall be governed by the applicable
laws of the State of Texas and the United States of America.

      


      8.07  Severability.  In
the event that any provision of this instrument or the Note conflicts with
applicable law, such conflict shall not affect other provisions of this Deed of
Trust or the Note which can be given effect without the conflicting provisions,
and to this end the provisions of this Deed of Trust and the Note are declared
to be severable.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      


      8.08  Usury
Disclaimer.  The term "Maximum Lawful Rate" means the maximum
rate of interest and the term "Maximum Lawful Amount" means the maximum amount
of interest that are permissible under applicable state or federal law for the
type of loan evidenced by the Note and the other Loan
Documents.  Beneficiary does not intend to contract for, charge or
receive more than the Maximum Lawful Rate or Maximum Lawful Amount permitted by
applicable state or federal law, and to prevent such an occurrence Beneficiary
and Grantor agree that all amounts of interest, whenever contracted for, charged
or received by Beneficiary, with respect to the loan of money evidenced by the
Note or with respect to any other amount payable under this Deed of Trust or any
of the other Loan Documents, shall be spread, prorated or allocated over the
full period of time the Note is unpaid, including the period of any renewal or
extension of the Note.  If demand for payment of the Note is made by
Beneficiary prior to the full stated term, the total amount of interest
contracted for, charged or received to the time of such demand shall be spread,
prorated or allocated along with any interest thereafter accruing over the full
period of time that the Note thereafter remains unpaid for the purpose of
determining if such interest exceeds the Maximum Lawful Amount.  At
maturity (including maturity due to Beneficiary's acceleration of the Note) or
on earlier final payment of the Note, Beneficiary shall compute the total amount
of interest that has been contracted for, charged or received by Beneficiary or
payable by Grantor  under this Note and compare such amount to the
Maximum Lawful Amount that could have been contracted for, charged or received
by Beneficiary.  If such computation reflects that the total amount of
interest that has been contracted for, charged or received by Beneficiary or
payable by Grantor  exceeds the Maximum Lawful Amount, then
Beneficiary shall apply such excess to the reduction of the principal balance
and not to the payment of interest; or if such excess interest exceeds the
unpaid principal balance, such excess shall be refunded to Grantor
..  This provision concerning the crediting or refund or excess
interest shall control and take precedence over all other agreements between
Grantor  and Beneficiary so that under no circumstances shall the
total interest contracted for, charged or received by Beneficiary exceed the
Maximum Lawful Amount.

      


      8.09  Partial
Invalidity.  In the event any portion of the sums intended to
be secured by this Deed of Trust cannot be lawfully secured hereby, payments in
reduction of such sums shall be applied first to those portions not secured
hereby.

      


      8.10  Captions.  The
captions and headings of the Articles and Sections of this Deed of Trust are for
convenience only and are not to be used to interpret or define the terms and
provisions of this Deed of Trust.

      


      8.12  Purpose. The Note
secured by this Deed of Trust is for (i) the costs of refinancing the purchase
price for the property described herein and the Beneficiary is expressly
subrogated to all lien rights and priorities of the liens being paid and
extended, and (ii) to finance the development costs of the Property, and this
deed of trust shall be construed as a construction mortgage for all
purposes.  Beneficiary shall have the rights and liens of a
construction lender under the laws of the State of Texas.

      


      


      


      
        
          
            
              	 	GRANTOR:	 
	 	WILSON
      FAMILY COMMUNITIES, INC.	 
	 	 	 	 
	
                       

                    	
                      By:
      

                    	 	 
	 	Name:	 	 
	 	Title	 	 
	 	 	 	 


            

          

        

      

       

       

       

       

       

       

       

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
        
          	
                  STATE
      OF TEXAS

                	
                  §

                
	 
      	
                  §

                
	
                  COUNTY
      OF TRAVIS   

                	
                  §

                


        

      

       

       

      


      This instrument was acknowledged before
me on                    
       ,
2009, by ___________________, _________________________ of WILSON FAMILY
COMMUNITIES, INC., a Delaware corporation, on behalf of said
corporation.

      
        
          	 	 	 	 
	 	 	 	 
	 	 	Notary
      Public, State of Texas	 
	 	 	 	 
	 	 	 	 


        

      

    

     

     

     

     

     

     

    
      


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      After recording, please
return to:

      
        Jud
Cary

      

      
        11612 BEE
CAVES ROAD, SUITE 260

      

      AUSTIN,
TEXAS 78738