<PAGE>



                                                                    EXHIBIT 10.8

                                 PROMISSORY NOTE

  REFERENCES IN THE SHADED AREA ARE FOR LENDER'S USE ONLY AND DO NOT LIMIT THE
         APPLICABILITY OF THIS DOCUMENT TO ANY PARTICULAR LOAN OR ITEM.

 ANY ITEM ABOVE CONTAINING **** HAS BEEN OMITTED DUE TO TEXT LENGTH LIMITATIONS.
--------------------------------------------------------------------------------

<TABLE>

<S>                                                     <C>
BORROWER:  US GLOBAL AEROSPACE, INC. F/K/A CARING       LENDER: WESTERN SECURITY BANK
           PRODUCTS INTERNATIONAL, INC. ALSO KNOWN              GREENWAY OFFICE
           AS U.S. GLOBAL NANOSPACE, INC.                       16277 GREENWAY HAYDEN LOOP
           2633 NORTH CARSON STREET, STE. 610S                  SCOTTSDALE, AZ 85260
           CARSON CITY, NV 89706
</TABLE>

<TABLE>
<S>                                        <C>                            <C>
Principal Amount:  $1,650,000.00           Interest Rate:  13.000%        Date of Note: June 30, 2003
</TABLE>

PROMISE TO PAY. US GLOBAL AEROSPACE.  INC. F/K/A CARING PRODUCTS  INTERNATIONAL,
INC. ALSO KNOWN AS U.S. GLOBAL NANOSPACE,  INC.  ("Borrower") promises to pay to
WESTERN SECURITY BANK ("Lender"), or order, in lawful money of the United States
of America,  the principal  amount of One Million Six Hundred  Fifty  Thousand &
00/100  Dollars  ($1,650,000.00),  together with Interest at the rate of 13.000%
per annum on the unpaid  principal  balance  from June 30,  2003,  until paid in
full.

PAYMENT.  Borrower will pay this loan in one principal  payment of $1,650,000.00
plus  Interest on August 31. 2003.  This payment due on August 31, 2003,  win be
for all principal and all accrued interest not yet paid. Unless otherwise agreed
or required by  applicable  law,  payments  will be applied first to any accrued
unpaid Interest;  then to principal;  than to any unpaid  collection  costs; and
than to any late charges.  The annual Interest rate for this Note Is computed on
a 366/360 basis; that is, by applying the ratio of the annual Interest rate over
a year of 360 days, multiplied by the outstanding principal balance,  multiplied
by the actual number of days the principal balance is outstanding. Borrower will
pay Lander at Lender's  address shown above or at such other place as Lender may
designate in writing.

EFFECTIVE  RATE.  Borrower  agrees to an effective  rate of interest that is the
rate  specified in this Note plus any  additional  rate resulting from any other
charges in the nature of  interest  paid or to be paid in  connection  with this
Note.

PREPAYMENT. Borrower agrees that all loan fees and other prepaid finance charges
are  earned  fully as of the date of the loan and will not be  subject to refund
upon early  payment  (whether  voluntary or as a result of  default),  except as
otherwise  required by law.  Except for the foregoing,  Borrower may pay without
penalty  all or a portion  of the  amount  owed  earlier  than it is due.  Early
payments will not,  unless agreed to by Lender in writing,  relieve  Borrower of
Borrower's  obligation to continue to make payments under the payment  schedule.
Rather,  early payments will reduce the principal  balance due.  Borrower agrees
not to send  Lender  payments  marked  "paid in full",  "without  recourse",  or
similar language. If Borrower sands such a payment, Lender may accept it without
losing any of  Lender's  rights  under  this  Note,  and  Borrower  will  remain
obligated to pay any further amount owed to Lender.  All written  communications
concerning  disputed  amounts,  including any check or other payment  instrument
that indicates that the payment constitutes "payment in full" of the amount owed
or that is tendered with other conditions or limitations or as full satisfaction
of a disputed  amount must be mailed or delivered  to:  WESTERN  SECURITY  BANK,
GREENWAY OFFICE, 16277 GREENWAY HAYDEN LOOP SCOTTSDALE, AZ 85260.

LATE  CHARGE.  If a payment  is 11 days or more late,  Borrower  will be charged
5.OOO% of the  unpaid  portion  of the  regularly  scheduled  payment or $25.OO,
whichever is greater.

INTEREST  AFTER  DEFAULT,  Upon  default,  including  failure  to pay upon final
maturity,  Lender,  at its  option,  may, if  permitted  under  applicable  law,
increase the interest rate on this Note to 19.000% per annum.  The interest rate
will not exceed the maximum rate permitted by applicable law.

DEFAULT.  Each of the following shall  constitute an event of default ("Event of
Default") under this

     Note:  Payment  Default.  Borrower fails to make any payment when due under
     this Note.

     Other Defaults. Borrower fails to comply with or to perform any other term,
     obligation,  covenant or condition  contained in this Note or in any of the
     related  documents  or to comply with or to perform  any term,  obligation,
     covenant or condition  contained in any other agreement  between Lender and
     Borrower.

     False  Statements.  Any  warranty,  representation  or  statement  made  or
     furnished to Lender by Borrower or on Borrower's  behalf under this Note or
     the related  documents  is false or  misleading  in any  material  respect,
     either now or at the time made or furnished or becomes  false or misleading
     at any time thereafter.

     Insolvency.  The  dissolution or  termination of Borrower's  existence as a
     going business,  the insolvency of Borrower,  the appointment of a receiver
     for any part of  Borrower's  property,  any  assignment  for the benefit of
     creditors,  any  type  of  creditor  workout,  or the  commencement  of any
     proceeding under any bankruptcy or Insolvency laws by or against Borrower.

     Creditor  or  Forfeiture   Proceedings.   Commencement  of  foreclosure  or
     forfeiture   proceedings,   whether  by  judicial  proceeding,   self-help,
     repossession  or any other  method,  by any  creditor of Borrower or by any
     governmental agency against any collateral securing the loan. This includes
     a garnishment of any of Borrower's  accounts,  including  deposit accounts,
     with Lender.  However,  this Event of Default shall not apply if there is a
     good faith dispute by Borrower as to the validity or  reasonableness of the
     claim which is the basis of the creditor or  forfeiture  proceeding  and If
     Borrower  gives  Lender  written  notice  of  the  creditor  or  forfeiture
     proceeding  and  deposits  with  Lender  monies  or a  surety  bond for the
     creditor or forfeiture  proceeding,  in an amount  determined by Lender, in
     its sole discretion, as being an adequate reserve or bond for the dispute.

     Events Affecting Guarantor. Any of the preceding events occurs with respect
     to any  Guarantor  of any of the  Indebtedness  or any  Guarantor  dies  or
     becomes  incompetent,  or revokes or disputes the validity of, or liability
     under, any guaranty of the Indebtedness evidenced by this Note.

     Change In Ownership.  Any change in ownership of twenty-five  percent (25%)
     or more of the common stock of Borrower.

     Adverse Change.  A material  adverse change occurs in Borrower's  financial
     condition,  or Lender  believes the prospect of payment or  performance  of
     this Note is impaired.

     Insecurity. Lender in good faith believes itself insecure.

LENDER'S  RIGHTS.  Upon default,  Lender may declare the entire unpaid principal
balance on this Note and all accrued unpaid interest  immediately  due, and then
Borrower will pay that amount.

ATTORNEYS' FEES;  EXPENSES.  Lender may hire or pay someone else to help collect
this Note if Borrower does not pay.  Borrower will pay Lender that amount.  This
includes,  subject to any limits under applicable law, Lender's  attorneys' fees
and  Lender's  legal  expenses,  whether  or not there is a  lawsuit,  including
attorneys'  fees,  expenses for  bankruptcy  proceedings  (including  efforts to
modify or vacate  any  automatic  stay or  injunction),  and  appeals.  However,
Borrower  will only pay  attorneys'  fees of an attorney not  Lender's  salaried
employee,  to whom the  matter is  referred  after  Borrower's  default.  If not
prohibited by applicable law, Borrower also will pay any court costs in addition
to all other sums provided by law.

<PAGE>

GOVERNING  LAW.  This  Note will be  governed  by,  construed  and  enforced  in
accordance with federal law and the laws of the State of Arizona.  This Note has
been accepted by Lender In the State of Arizona.

DISHONORED  ITEM FEE.  Borrower  will pay a fee to Lender of $22.50 if  Borrower
makes a payment on Borrower's  loan and the check or  preauthorized  charge with
which Borrower pays is later dishonored.

RIGHT OF SETOFF.  To the extent  permitted by applicable  law, Lender reserves a
right of  setoff in all  Borrower's  accounts  with  Lender  (whether  checking,
savings,  or some other  account).  This  includes all accounts  Borrower  holds
jointly  with  someone  else and all  accounts  Borrower may open in the future.
However,  this does not include any IRA or Keogh accounts, or any trust accounts
for which setoff would be prohibited by law. Borrower  authorizes Lender, to the
extent  permitted by  applicable  law, to charge or setoff all sums owing on the
Indebtedness  against any and all such  accounts,  and, at Lender's  option,  to
administratively  freeze all such  accounts to allow Lender to protect  Lender's
charge and setoff rights provided in this paragraph.

COLLATERAL.  Borrower  acknowledges this Note is secured by Security  Agreements
dated September 30, 2002 and November 27, 2001 with UCC-1's  recorded October 3,
2002  with  Nevada  Secretary  of State,  Delaware  Secretary  of  State,  Texas
Secretary of State and Arizona  Secretary of State and amendments to be recorded
adding the name of U.S. Global Nanospace, Inc.

SUCCESSOR INTERESTS.  The terms of this Note shall be binding upon Borrower, and
upon Borrower's heirs,  personal  representatives,  successors and assigns,  and
shall inure to the benefit of Lender and its successors and assigns.

GENERAL  PROVISIONS.  Lender may delay or forgo  enforcing  any of its rights or
remedies under this Note without losing them.  Borrower and any other person who
signs,  guarantees or endorses this Note,  to the extent  allowed by law,  waive
presentment,  demand for payment, and notice of dishonor. Upon any change in the
terms of this Note, and unless otherwise  expressly stated in writing,  no party
who signs  this  Note,  whether  as  maker,  guarantor,  accommodation  maker or
endorser,  shall be released from liability.  All such parties agree that Lender
may renew or extend (repeatedly and for any length of time) this loan or release
any party or guarantor or collateral; or impair, fail to realize upon or perfect
Lender's security  interest in the collateral;  and take any other action deemed
necessary by Lender without the consent of or notice to anyone. All such parties
also agree that Lender may modify this loan  without the consent of or notice to
anyone other than the party with whom the  modification is made. The obligations
under this Note are joint and several.



PRIOR TO SIGNING THIS NOTE,  BORROWER READ AND  UNDERSTOOD ALL THE PROVISIONS OF
THIS NOTE. BORROWER AGREES TO THE TERMS OF THE NOTE.



BORROWER ACKNOWLEDGES RECEIPT OF A COMPLETED COPY OF THIS PROMISSORY NOTE.



BORROWER


US GLOBAL AEROSPACE,  INC. F/K/A CARING PRODUCTS INTERNATIONAL,  INC. ALSO KNOWN
AS U.S. GLOBAL NANOSPACE, INC.

   BY: /s/JOHN ROBINSON
      ------------------------------------------
        JOHN D. ROBINSON, PRESIDENT OF US GLOBAL
        AEROSPACE, INC. F/K/A CARING PRODUCTS
        INTERNATIONAL, INC. ALSO KNOWN AS U.S.
        GLOBAL NANOSPACE, INC.

   WESTERN SECURITY BANK


   X
    -------------------------
    AUTHORIZED SIGNATURE



<PAGE>



DISBURSEMENT REQUEST AND AUTHORIZATION




  REFERENCES IN THE SHADED AREA ARE FOR LENDER'S USE ONLY AND DO NOT LIMIT THE
         APPLICABILITY OF THIS DOCUMENT TO ANY PARTICULAR LOAN OR ITEM.

 ANY ITEM ABOVE CONTAINING **** HAS BEEN OMITTED DUE TO TEXT LENGTH LIMITATIONS.

-------------------------------------------------------------------------------

Borrower: US GLOBAL AEROSPACE, INC. F/K/A CARING
          PRODUCTS INTERNATIONAL, INC. ALSO KNOWN AS U.S. GLOBAL NANOSPACE, INC.
            2633 NORTH CARSON STREET, STE. 6108
          CARSON CITY, NV 89706

Lender:   WESTERN SECURITY BANK GREENWAY OFFICE 16277 GREENWAY HAYDEN LOOP
            SCOTTSDALE, AZ 85260


LOAN TYPE. This is a Fixed Rate (13.000%)  Nondisclosable  Loan to a Corporation
for $1,660,000.00 due on August 31, 2003.

PRIMARY PURPOSE OF LOAN. The primary purpose of this loan is for:

          [ ] Personal, Family, or Household Purposes or Personal Investment.

          |X| Business (Including Real Estate Investment).

SPECIFIC  PURPOSE.  The  specific  purpose  of this loan is:  RENEWAL OF WORKING
CAPITAL.

DISBURSEMENT  INSTRUCTIONS.  Borrower  understands that no loan proceeds will be
disbursed  until  all of  Lender's  conditions  for  making  the loan  have been
satisfied. Please disburse the loan proceeds of $1,650,000.00 as follows:

          Amount paid on Borrower's account:                       $1,660,000.00
            $1,000,000.00 Payment on Loan
            # 4971309713 $400,000.00 Payment on Loan
            # 4971309714 $250,000.00 Payment on Loan if
            4971309715
                                                                  --------------
          Note Principal:                                          $1,660,000.00

CHARGES  PAID IN  CASH.  Borrower  has paid or will  pay in cash as  agreed  the
following charges:

          Prepaid Finance Charges Paid In Cash:                          $250.00
            $250.00  Documentation Fee

          Other Charges Paid in Cash:                                 $54,810.64
            $33,222.21 Interest thru 6/30/03-Note 4971309713
            $13,288.88 Interest thru 6/30/03-Note 4971309714
            $8,299.65 Interest thru 6/30/03-Note 4971309715
                                                                  --------------

          Total Charges Paid In Cash:                                 $56,060.64

FINANCIAL  CONDITION.  BY SIGNING THIS  AUTHORIZATION,  BORROWER  REPRESENTS AND
WARRANTS TO LENDER THAT THE  INFORMATION  PROVIDED ABOVE IS TRUE AND CORRECT AND
THAT THERE HAS BEEN NO MATERIAL ADVERSE CHANGE IN BORROWER'S FINANCIAL CONDITION
AS DISCLOSED  IN  BORROWER'S  MOST RECENT  FINANCIAL  STATEMENT TO LENDER.  THIS
AUTHORIZATION IS DATED JUNE 30, 2003.



<PAGE>



/S/John Robinson

BORROWER:

US GLOBAL AER081J&CE, INC. r/jf/A CARING PRODUCTS INTERNATIONAL, INC. ALSO KNOWN
AS U.S. GLOBAL NANOSPACE, INC.

     JOHN O.  ROBINSON,  PRESIDENT  of US GLOBAL  AEROSPACE.  INC.  F/K/A CARING
     PRODUCTS INTERNATIONAL, INC. ALSO KNOWN AS U.S. GLOBAL NANOSPACE, INC.


<PAGE>



                          COMMERCIAL SECURITY AGREEMENT





    References in the shaded area are for Lender's use only and do not limit
       the applicability of this document to any particular loan or item.
--------------------------------------------------------------------------------
 Any item above containing **** has been omitted due to text length limitations.

Grantor:  US GLOBAL AEROSPACE, INC. F/K/A CARING
            PRODUCTS INTERNATIONAL. INC. ALSO KNOWN AS U.S. GLOBAL NANOSPACE,
            INC. 2633 NORTH CARSON STREET. STE. BIOS CARSON CITY, NV 89706

Lender:   WESTERN SECURITY BANK
          GREENWAY OFFICE
          16277 GREENWAY HAYDEN LOOP
          SCOTTSDALE, AZ 85260


THIS  COMMERCIAL  SECURITY  AGREEMENT  dated June 30,  2003,  made and  executed
between US GLOBAL AEROSPACE, INC. F/K/A CARING PRODUCTS INTERNATIONAL, INC. ALSO
KNOWN AS U.S.  GLOBAL  NANOSPACE,  INC.  ("Grantor")  and WESTERN  SECURITY BANK
("Lender").

GRANT OF SECURITY INTEREST. For valuable consideration, Grantor grants to Lender
a security interest in the Collateral to secure the Indebtedness and agrees that
Lender  shall  have the  rights  stated in this  Agreement  with  respect to the
Collateral, In addition to all other rights which Lender may have by law.

COLLATERAL  DESCRIPTION.  The word  "Collateral" as used In this Agreement means
the  following  described  property,  whether now owned or  hereafter  acquired,
whether now  existing or  hereafter  arising,  and  wherever  located,  in which
Grantor  is  giving  to  Lender  a  security  interest  for the  payment  of the
Indebtedness  and performance of all other  obligations  under the Note and this
Agreement:

     All  inventory,  equipment,  accounts  (including  but not  limited  to all
     health-care-insurance  receivables),  chattel paper, instruments (including
     but not limited to all promissory notes),  letter-of-credit  rights, letter
     of credit documents,  deposit accounts,  investment property,  money, other
     rights to payment and performance,  and general intangibles  (including but
     not limited to all software and all payment intangibles);  all oil, gas and
     other minerals before extraction; all oil, gas, other minerals and accounts
     constituting  as-extracted collateral;  all fixtures; all timber to be cut;
     all  attachments,  accessions,  accessories,  fittings,  increases,  tools,
     parts,  repairs,  supplies,  and commingled goods relating to the foregoing
     property,  and all additions,  replacements of and substitutions for all or
     any part of the foregoing  property;  all insurance refunds relating to the
     foregoing property;  all good will relating to the foregoing property;  all
     records and data and embedded software relating to the foregoing  property,
     and all equipment,  inventory and software to utilize, create, maintain and
     process any such records and data on electronic  media;  and all supporting
     obligations relating to the foregoing property; all whether now existing or
     hereafter  arising,  whether now owned or hereafter acquired or whether now
     or  hereafter  subject to any  rights In the  foregoing  property;  and all
     products and proceeds (Including but not limited to all insurance payments)
     of or relating to the foregoing property,

In addition, the word "Collateral" also includes all the following,  whether now
owned or hereafter  acquired,  whether now existing or  hereafter  arising,  and
wherever located:

(A)  All  accessions,   attachments,   accessories,   tools,  parts,   supplies,
     replacements  of and additions to any of the collateral  described  herein,
     whether added now or later.

(B)  All  products  and  produce  of any  of  the  property  described  in  this
     Collateral section.

(C)  All accounts,  general intangibles,  instruments,  rents, monies, payments,
     and all other rights arising out of a sale,  lease, or other disposition of
     any of the property described in this Collateral section.

(D)  All proceeds  (including  insurance  proceeds) from the sale,  destruction,
     loss,  or  other  disposition  of any of the  property  described  in  this
     Collateral  section,  and sums due from a third  party who has  damaged  or
     destroyed  the  Collateral  or from that  party's  insurer,  whether due to
     judgment, settlement or other process.

(E)  All records  and data  relating to any of the  property  described  in this
     Collateral  section,  whether  in  the  form  of  a  writing,   photograph,
     microfilm,  microfiche, or electronic media, together with all of Grantor's
     right,  title,  and  interest in and to all computer  software  required to
     utilize,  create,  maintain,  and  process  any  such  records  or  data on
     electronic media.

Despite any other provision of this Agreement,  Lender is not granted,  and will
not have, a  nonpurchase  money  security  interest in household  goods,  to the
extent  such a security  interest  would be  prohibited  by  applicable  law. In
addition,  if because of the type of any Property,  Lender is required to give a
notice of the right to cancel under Truth in-Lending for the Indebtedness,  then
Lender  will not have a security  interest in such  Collateral  unless and until
such a notice is given.

CROSS-COLLATERALIZATION.  In addition to the Note,  this  Agreement  secures all
obligations, debts and liabilities, plus interest thereon, of Grantor to Lender,
or any one or more of them, as well as all claims by Lender  against  Grantor or
any one or more of them,  whether now  existing or  hereafter  arising,  whether
related or unrelated to the purpose of the Note, whether voluntary or otherwise,
whether due or not due, direct or indirect, determined or undetermined, absolute
or  contingent,  liquidated  or  unliquidated  whether  Grantor  may  be  liable
individually  or jointly with others,  whether  obligated as guarantor,  surety,
accommodation party or otherwise, and whether recovery


<PAGE>



                          COMMERCIAL SECURITY AGREEMENT

Loan No: 4971309716           (Continued)                                 Page 2
--------------------------------------------------------------------------------


upon such  amounts  may be or  hereafter  may  become  barred by any  statute of
limitations,  and  whether  the  obligation  to  repay  such  amounts  may be or
hereafter may become otherwise unenforceable.

RIGHT OF SETOFF.  To the extent  permitted by applicable  law. Lender reserves a
right of  setpff  in all  Grantor's  accounts  with  Lender  (whether  checking,
savings,  or some other  account).  This  includes  all accounts  Grantor  holds
jointly  with  someone  else and all  accounts  Grantor  may open in the future.
However,  this does not include any IRA or Keogh accounts, or any trust accounts
for which setoff would be prohibited by law. Grantor  authorizes  Lender, to the
extent  permitted by  applicable  law, to charge or setoff all sums owing on the
Indebtedness  against any and all such  accounts,  and, at Lender's  option,  to
administratively  freeze all such  accounts to allow Lender to protect  Lender's
charge and setoff rights provided in this paragraph.

GRANTOR'S  REPRESENTATIONS  AND WARRANTIES WITH RESPECT TO THE COLLATERAL.  With
respect to the Collateral, Grantor represents and promises to Lender that:

     Perfection  of  Security  Interest.  Grantor  agrees to  execute  financing
     statements  and to take  whatever  other actions are requested by Lender to
     perfect and continue  Lender's  security  interest in the Collateral.  Upon
     request  of  Lender,  Grantor  will  deliver  to Lender  any and ell of the
     documents evidencing or constituting the Collateral,  and Grantor will note
     Lender's interest upon any and all chattel paper if not delivered to Lender
     for possession by Lender.

     Notices  to  Lender.  Grantor  will  promptly  notify  Lender in writing at
     Lender's  address  shown  above (or such  other  addresses  as  Lender  may
     designate from time to time) prior to any (1) change in Grantor's name; (2)
     change in Grantor's assumed business name(s);  (3) change in the management
     of the Corporation  Grantor;  14) change In the authorized  signer(s);  (5)
     change in Grantor's principal office address; (6) change in Grantor's state
     of  organization;  (7)  conversion of Grantor to a new or different type of
     business entity; or (8) change In any other aspect of Grantor that directly
     or indirectly  relates to any  agreements  between  Grantor and Lender.  No
     change in Grantor's  name or state of  organization  will take effect until
     after Lender has received notice

     No Violation. The execution and delivery of this Agreement will not violate
     any law or-agreement  governing Grantor or to which Grantor is a party, and
     its certificate or articles of incorporation and bylaws do not prohibit any
     term or condition of this Agreement.

     Enforceability  of  Collateral.  To the extent the  Collateral  consists of
     accounts, chattel paper, or general intangibles, as. defined by the Uniform
     Commercial  Code,  the  Collateral Is  enforceable  in accordance  with its
     terms,  is  genuine,  and  fully  complies  with  all  applicable  laws and
     regulations   concerning  form,  content  and  manner  of  preparation  and
     execution, and all persons appearing to be obligated on the Collateral have
     authority and capacity to contract and are in fact obligated as they appear
     to be on the  Collateral.  At the time any  Account  becomes  subject  to a
     security interest in favor of Lender, the Account shall be a good and valid
     account representing an undisputed,  bona fide Indebtedness incurred by the
     account debtor for  merchandise  held subject to delivery  instructions  or
     previously  shipped or  delivered  pursuant to a contract  of sale,  or for
     services previously performed by Grantor with or for the account debtor. So
     long as this  Agreement  remains in  effect,  Grantor  shall  not,  without
     Lender's  prior written  consent,  compromise,  settle,  adjust,  or extend
     payment  under or with  regard  to any  such  Accounts.  There  shall be no
     setoffs or  counterclaims  against any of the Collateral,  and no agreement
     shall have been made under which any deductions or discounts may be claimed
     concerning the Collateral except those disclosed to Lender in writing.

     Location of the  Collateral.  Except in the  ordinary  course of  Grantor's
     business,  Grantor  agrees to keep the  Collateral  (or to the  extent  the
     Collateral  consists  of  intangible  property  such as accounts or general
     Intangibles,  the records  concerning the Collateral) at Grantor's  address
     shown above or at such other  locations as are  acceptable to Lender.  Upon
     Lender's  request,  Grantor will deliver to Lender In form  satisfactory to
     Lender a schedule of real properties and Collateral  locations  relating to
     Grantor's operations,  including without limitation the following:  (1) all
     real property Grantor owns, or is purchasing; (2) all real property Grantor
     is renting or leasing;  (3) all storage  facilities  Grantor  owns,  rents,
     leases, or uses; and (4) all other properties where Collateral is or may be
     located.

     Removal  of the  Collateral.  Except in the  ordinary  course of  Grantor's
     business,  including the sales of  inventory.  Grantor shall not remove the
     Collateral  from its  existing  location  without  Lender's  prior  written
     consent. To the extent that the Collateral  consists of vehicles,  or other
     titled  property,  Grantor  shall not take or permit any action which would
     require  application for certificates of title for the vehicles outside the
     State of Arizona,  without Lender's prior written  consent.  Grantor shall,
     whenever requested, advise Lender of the exact location of the Collateral.

     Transactions  Involving Collateral.  Except for inventory sold or accounts'
     collected in the ordinary  course of  Grantor's  business,  or as otherwise
     provided for in this Agreement,  Grantor shall not sell,  offer to sell, or
     otherwise  transfer or dispose of the  Collateral.  While Grantor Is not in
     default under this Agreement,  Grantor may sell Inventory,  but only in the
     ordinary  course of its  business and only to buyers who qualify as a buyer
     in the  ordinary  course  of  business.  A sale in the  ordinary  course of
     Grantor's  business  does  not  include  a  transfer  in  partial  or total
     satisfaction  of a  debt  or any  bulk  sale.  Grantor  shall  not  pledge,
     mortgage,  encumber or otherwise permit the Collateral to be subject to any
     lien, security interest,  encumbrance,  or charge,  other than the security
     interest provided for in this Agreement,  without the prior written consent
     of Lender.  This includes security interests even if junior in right to the
     security  interests granted under this Agreement.  Unless waived by Lender,
     all proceeds from any disposition of the Collateral  (for whatever  reason)
     shall be held in trust for  Lender  and shall  not be  commingled  with any
     other  funds;  provided  however,  this  requirement  shall not  constitute
     consent by Lender to any sale or other disposition.  Upon receipt.  Grantor
     shall immediately deliver any such proceeds to Lender.

     Title.  Grantor  represents  and warrants to Lender that Grantor holds good
     and  marketable  title to the  Collateral,  free and clear of all liens and
     encumbrances except for the lien of this Agreement.  No financing statement
     covering any of the  Collateral  is on file in any public office other than
     those which reflect the security  interest  created by this Agreement or to
     which Lender has  specifically  consented.  Grantor  shall defend  Lender's
     rights


<PAGE>



                          COMMERCIAL SECURITY AGREEMENT

Loan No: 4971309716                (Continued)                            Page 3
--------------------------------------------------------------------------------

     in the Collateral against the claims and demands of all other persons.

     Repairs and Maintenance.  Grantor agrees to keep and maintain, and to cause
     others to keep and  maintain,  the  Collateral  in good  order,  repair and
     condition  at all times  while this  Agreement  remains in effect.  Grantor
     further  agrees to pay when due all  claims  for work done on, or  services
     rendered or material furnished in connection with the Collateral so that no
     lien or encumbrance may ever attach to or be filed against the Collateral.

     Inspection of Collateral.  Lender and Lender's  designated  representatives
     and agents  shall  have the right at all  reasonable  times to examine  and
     inspect the Collateral wherever located.

     Taxes,  Assessments  and  Liens.  Grantor  will  pay  when  due all  taxes,
     assessments and liens upon the Collateral,  its use or operation, upon this
     Agreement,  upon any promissory note or notes evidencing the  Indebtedness,
     or upon any of the other Related  Documents.  Grantor may withhold any such
     payment  or may  elect to  contest  any lien if  Grantor  is in good  faith
     conducting an  appropriate  proceeding to contest the obligation to pay and
     so long as  Lender's  interest  in the  Collateral  is not  jeopardized  in
     Lender's  sole opinion.  If the  Collateral is subjected to a lien which is
     not discharged within fifteen (15) days,  Grantor shall deposit with Lender
     cash, a sufficient corporate surety bond or other security  satisfactory to
     Lender in an amount  adequate to provide for the discharge of the lien plus
     any interest,  costs, attorneys' fees or ether charges that could accrue as
     a result of foreclosure or sale of the  Collateral.  In any contest Grantor
     shall defend itself and Lender and shall satisfy any final adverse judgment
     before enforcement against the Collateral.  Grantor shall name Lender as an
     additional   obligee  under  any  surety  bond  furnished  in  the  contest
     proceedings.  Grantor  further  agrees to furnish Lander with evidence that
     such taxes, assessments,  and governmental and other charges have been paid
     in full and in a timely  manner.  Grantor may  withhold any such payment or
     may elect to contest  any lien if Grantor  is in good faith  conducting  an
     appropriate  proceeding  to contest  the  obligation  to pay and so long as
     Lender's interest in the Collateral is not jeopardized.

     Compliance with  Governmental  Requirements.  Grantor shall comply promptly
     with all  laws,  ordinances,  rules  and  regulations  of all  governmental
     authorities,  now or  hereafter  in effect,  applicable  to the  ownership,
     production,  disposition,  or use of the Collateral,  including all laws or
     regulations  relating  to the  undue  erosion  of  highly-erodible  land or
     relating  to  the   conversion  of  wetlands  for  the   production  of  an
     agricultural  product or  commodity.  Grantor may contest in good faith any
     such law,  ordinance  or  regulation  and  withhold  compliance  during any
     proceeding,  including appropriate appeals, so long as Lender's interest in
     the Collateral, in Lender's opinion, is not jeopardized.

     Hazardous  Substances.  Grantor represents and warrants that the Collateral
     never has been, and never will be so long as this Agreement  remains a lien
     on the Collateral,  used in violation of any Environmental  Laws or for the
     generation,  manufacture,  storage,  transportation,  treatment,  disposal,
     release  or   threatened   release   of  any   Hazardous   Substance.   The
     representations and warranties  contained herein are based on Grantor's due
     diligence in investigating the Collateral for Hazardous Substances. Grantor
     hereby  (1)  releases  and  waives any  future  claims  against  Lender for
     indemnity or  contribution  in the event Grantor becomes liable for cleanup
     or other costs under any  Environmental  Laws,  and (2) agrees to indemnify
     and hold harmless  Lender  against any and all claims and losses  resulting
     from a breach of this  provision  of this  Agreement.  This  obligation  to
     indemnify   shall  survive  the  payment  of  the   Indebtedness   and  the
     satisfaction of this Agreement,

     Maintenance of Casualty  Insurance.  Grantor shall procure and maintain all
     risks  insurance,  including  without  limitation fire, theft and liability
     coverage  together  with such other  insurance  as Lender may require  with
     respect to the Collateral, in form, amounts, coverages and basis reasonably
     acceptable  to  Lender  and  issued by a company  or  companies  reasonably
     acceptable  to Lender.  Grantor,  upon  request of Lender,  will deliver to
     Lender from time to time the policies or  certificates of insurance in form
     satisfactory to Lender,  including  stipulations that coverages will not be
     cancelled  or  diminished  without  at least ten (10) days'  prior  written
     notice  to  Lender  and  not  including  any  disclaimer  of the  insurer's
     liability  for failure to give such a notice.  Each  insurance  policy also
     shall  include an  endorsement  providing  that coverage in favor of Lender
     will not be impaired in any way by any act,  omission or default of Grantor
     or any other person.  In connection  with all policies  covering  assets in
     which Lender holds or is offered a security interest.  Grantor will provide
     Lender with such loss payable or other  endorsements as Lender may require.
     If  Grantor  at any time  fails to  obtain or  maintain  any  insurance  as
     required under this  Agreement,  Lender may (but shall not be obligated to)
     obtain such insurance as Lender deems  appropriate,  including if Lender so
     chooses  "single  interest  insurance,"  which  will  cover  only  Lender's
     interest in the Collateral.

     Application of Insurance Proceeds.  Grantor shall promptly notify Lender of
     any loss or  damage to the  Collateral.  Lender  may make  proof of loss if
     Grantor  fails to do so  within  fifteen  (15)  days of the  casualty.  All
     proceeds of any insurance on the  Collateral,  including  accrued  proceeds
     thereon,  shall be held by  Lender  as part of the  Collateral.  If  Lender
     consents to repair or replacement  of the damaged or destroyed  Collateral,
     Lender shall,  upon  satisfactory  proof of  expenditure,  pay or reimburse
     Grantor from the proceeds for the reasonable cost of repair or restoration.
     If Lender  does not  consent to repair or  replacement  of the  Collateral,
     Lender shall  retain a sufficient  amount of the proceeds to pay all of the
     Indebtedness, and shall pay the balance to Grantor. Any proceeds which have
     not been  disbursed  within six (6) months  after  their  receipt and which
     Grantor has not committed to the repair or  restoration  of the  Collateral
     shall be used to prepay the Indebtedness.

     Insurance  Reserves.  Lender may require  Grantor to  maintain  with Lender
     reserves for payment of insurance premiums, which reserves shall be created
     by  monthly  payments  from  Grantor  of a sum  estimated  by  Lender to be
     sufficient  to produce,  at least  fifteen (15) days before the premium due
     date,  amounts at least  equal to the  insurance  premiums  to be paid.  If
     fifteen  (15)  days  before   payment  is  due,   the  reserve   funds  are
     insufficient,  Grantor shall upon demand pay any deficiency to Lender.  The
     reserve  funds  shall be held by  Lender  as a  general  deposit  and shall
     constitute  a  non-interest-bearing  account  which  Lender may  satisfy by
     payment of the  insurance  premiums  required to be paid by Grantor as they
     become due.  Lender does not hold the reserve  funds in trust for  Grantor,
     and  Lender  is not the  agent of  Grantor  for  payment  of the  insurance
     premiums required to be paid by Grantor. The responsibility for the payment
     of premiums shall remain Grantor's sole responsibility.



<PAGE>



                          COMMERCIAL SECURITY AGREEMENT

Loan No: 4971309716                   (Continued)                         Page 4
--------------------------------------------------------------------------------


     Insurance Reports. Grantor, upon request of Lender, shall furnish to Lender
     reports on each existing  policy of insurance  showing such  Information as
     Lender may reasonably request including the following:  (1) the name of the
     insurer;  {2) the risks  insured;  (3) the  amount of the  policy;  (4) the
     property  insured;  (5) the  than  current  value  on the  basis  of  which
     insurance has been obtained and the manner of determining  that value;  and
     (6) the  expiration  date of the policy.  In addition,  Grantor  shall upon
     request  by  Lender   (however  not  more  often  than  annually)  have  an
     independent appraiser satisfactory to Lender determine, as applicable,  the
     cash value or replacement cost of the Collateral.

     Financing  Statements.  Grantor authorizes Lender to file a UCC-1 financing
     statement,  or alternatively,  a copy of this Agreement to perfect Lender's
     security interest.  At Lender's' request,  Grantor  additionally  agrees to
     sign all other  documents  that are  necessary  to  perfect,  protect,  and
     continue Lender's  security interest in the Property.  Grantor will pay all
     filing fees,  title transfer fees, and other fees and costs involved unless
     prohibited  by law or unless Lender is required by law to pay such fees and
     costs:  Grantor irrevocably appoints Lender to execute financing statements
     and  documents  of title in  Grantor's  name and to execute  all  documents
     necessary to transfer  title if there is a default.  Lender may file a copy
     of this Agreement as a financing  statement.  If Grantor changes  Grantor's
     name or address,  or the name or address of any person  granting a security
     interest under this  Agreement  changes,  Grantor will promptly  notify the
     Lender of such change.

GRANTOR'S RIGHT TO POSSESSION AND TO COLLECT ACCOUNTS.  Until default and except
as  otherwise  provided  below  with  respect  to  accounts,  Grantor  may  have
possession  of the  tangible  personal  property and  beneficial  use of all the
Collateral  and may use it in any  lawful  manner  not  inconsistent  with  this
Agreement or the Related Documents,  provided that Grantor's right to possession
and  beneficial use shall not apply to any  Collateral  where  possession of the
Collateral by Lender is required by law to perfect Lender's security interest in
such Collateral.  Until otherwise notified by Lender, Grantor may collect any of
the Collateral  consisting of accounts.  At any time and even though no Event of
Default  exists,  Lender may  exercise its rights to collect the accounts and to
notify account  debtors to make payments  directly to Lender for  application to
the  Indebtedness.  If  Lender  at any time has  possession  of any  Collateral,
whether  before  or after an Event of  Default,  Lender  shall be deemed to have
exercised  reasonable care in the custody and  preservation of the Collateral if
Lender takes such action for that purpose as Grantor shall request or as Lender,
in Lender's sole discretion, shall deem appropriate under the circumstances, but
failure to honor any  request  by Grantor  shall not of itself be deemed to be a
failure to exercise  reasonable  care.  Lender shall not be required to take any
steps necessary to preserve any rights in the Collateral  against prior parties,
nor to protect,  preserve or maintain any security  interest given to secure the
Indebtedness.

LENDER'S  EXPENDITURES.  If any action or  proceeding  is  commenced  that would
materially  affect  Lender's  interest In the  Collateral or if Grantor fails to
comply with any provision of this Agreement or any Related Documents,  including
but not limited to  Grantor's  failure to  discharge or pay when due any amounts
Grantor is  required to  discharge  or pay under this  Agreement  or any Related
Documents,  Lender on Grantor's  behalf may (but shall not be obligated to) take
any action that Lender deems appropriate,  to the extent permitted by applicable
law,  including  but not  limited to  discharging  or paying  all taxes,  liens,
security  interests,  encumbrances and other claims at any time levied or placed
on the Collateral and paying all costs for insuring,  maintaining and preserving
the  Collateral.  All such  expenditures  incurred  or paid by  Lender  for such
purposes  will then bear  interest at the rate  charged  under the Note from the
date  incurred or paid by Lender to the date of repayment  by Grantor.  All such
expenses will become a part of the Indebtedness  and, at Lender's  option,  will
(A) be  payable  on  demand;  (B) be added to the  balance  of the Note,  and be
apportioned  among and be payable  with any  installment  payments to become due
during  either  (1) the  term of any  applicable  insurance  policy;  or (2) the
remaining term of the Note; or (3) be treated as a balloon payment which will be
due and payable at the Note's  maturity.  The Agreement also will secure payment
of these  amounts.  Such  right  shall be in  addition  to all other  rights and
remedies to which Lender may be entitled upon Default,  and shall be exercisable
by Lender to the extent permitted by applicable law.

DEFAULT.  Each of the following shall  constitute an Event of Default under this
Agreement: Payment Default.

     Grantor falls to make any payment when due under the Indebtedness.

     Other Defaults.  Grantor fails to comply with or to perform any other term,
     obligation,  covenant or condition contained in this Agreement or in any of
     the Related Documents or to comply with or to perform any term, obligation,
     covenant or condition  contained in any other agreement  between Lender and
     Grantor.

     False  Statements.  Any  warranty,  representation  or  statement  made  or
     furnished to Lender by Grantor or on Grantor's  behalf under this Agreement
     or the Related  Documents is false or misleading  in any material  respect,
     either now or at the time made or furnished or becomes  false or misleading
     at any time thereafter.

     Defective Collateralization. This Agreement or any of the Related Documents
     ceases to be in full force and effect (Including  failure of any collateral
     document to create a valid and perfected  security interest or lien) at any
     time and for any reason.

     Insolvency.  The  dissolution or  termination  of Grantor's  existence as a
     going  business,  the insolvency of Grantor,  the appointment of a receiver
     for any part of  Grantor's  property,  any  assignment  for the  benefit of
     creditors,  any  type  of  creditor  workout,  or the  commencement  of any
     proceeding under any bankruptcy or Insolvency laws by or against Grantor.

     Creditor  or  Forfeiture   Proceedings.   Commencement  of  foreclosure  or
     forfeiture  proceedings,  whether  by  judicial  proceeding,  self  -help,.
     repossession  or any other  method,  by any  creditor  of Grantor or by any
     governmental agency against any collateral securing the Indebtedness.  This
     includes a  garnishment  of any of Grantor's  accounts,  including  deposit
     accounts,  with Lender.  However,  this Event of Default shall not apply If
     there  is  a  good  faith   dispute  by  Grantor  as  to  the  validity  or
     reasonableness  of  the  claim  which  is the  basis  of  the  creditor  or
     forfeiture  proceeding  and if Grantor gives Lender  written  notice of the
     creditor or  forfeiture  proceeding  and deposits  with Lender  monies or a
     surety  bond  for  the  creditor  or  forfeiture  proceeding  in an  amount
     determined by Lender, in its sole discretion,  as being an adequate reserve
     or bond for the dispute.

     Events  Affecting  Guarantor,  Any of the-  preceding  events  occurs  with
     respect  to  Guarantor  of any of the  Indebtedness  or  Guarantor  dies or
     becomes  incompetent  or revokes or refutes the  validity  of, or liability
     under, any Guaranty of the Indebtedness.


<PAGE>



                          COMMERCIAL SECURITY AGREEMENT

Loan No: 4971309716                   (Continued)                         Page 5
--------------------------------------------------------------------------------

     Adverse  Change.  A material  adverse change occurs in Grantor's  financial
     condition, or Lender believes the prospect of payment or performance of the
     Indebtedness is impaired.

     Insecurity. Lender in good faith believes itself insecure.

RIGHTS  AND  REMEDIES  ON  DEFAULT.  If an Event of  Default  occurs  under this
Agreement, at any time thereafter, Lender shall have all the rights of a secured
party  under the  Arizona  Uniform  Commercial  Code.  In  addition  and without
limitation.  Lender may  exercise  any one or more of the  following  rights and
remedies:

     Accelerate  Indebtedness.  Lender  may  declare  the  entire  Indebtedness,
     including  any  prepayment  penalty which Grantor would be required to pay,
     immediately due and payable, without notice of any kind to Grantor.

     Assemble Collateral. Lender may require Grantor to deliver to Lender all or
     any portion of the  Collateral  and any and all  certificates  of title and
     other documents  relating to the Collateral.  Lender may require Grantor to
     assemble  the  Collateral  and make it available to Lender at a place to be
     designated  by Lender.  Lender also shall have full power to enter upon the
     property of Grantor to take possession of and remove the Collateral. If the
     Collateral  contains  other goods not covered by this Agreement at the time
     of repossession.  Grantor agrees Lender may take such other goods, provided
     that  Lender  makes  reasonable  efforts to return  them to  Grantor  after
     repossession.

     Sell the Collateral. Lender shall have full power to sell, lease, transfer,
     or otherwise deal with the  Collateral or proceeds  thereof in Lender's own
     name or that of Grantor.  Lender may sell the  Collateral at public auction
     or private sale.  Unless the  Collateral  threatens to decline  speedily in
     value or is of a type customarily sold on a recognized market.  Lender will
     give Grantor,  and other persons as required by law,  reasonable  notice of
     the time and place of any public sale,  or the time after which any private
     sale or any other disposition of the Collateral is to be made.  However, no
     notice need be provided to any person who,  after Event of Default  occurs,
     enters into and  authenticates an agreement  waiving that person's right to
     notification of sale. The requirements of reasonable notice shall be met if
     such  notice is given at least ten (10) days before the time of the sale or
     disposition.  All expenses  relating to the  disposition of the Collateral,
     including without limitation the expenses of retaking,  holding,  insuring,
     preparing for sale and selling the  Collateral,  shall become a part of the
     Indebtedness secured by this Agreement and shall be payable on demand, with
     interest at the Note rate from date of expenditure until repaid.

     Appoint Receiver.  Lender shall have the right to have a receiver appointed
     to take possession of all or any part of the Collateral,  with the power to
     protect and preserve the  Collateral,  to operate the Collateral  preceding
     foreclosure or sale, and to collect the Rents from the Collateral and apply
     the  proceeds,  over and above the cost of the  receivership,  against  the
     Indebtedness.  The  receiver  may serve  without  bond if permitted by law.
     Lender's right to the  appointment of a receiver shall exist whether or not
     the  apparent  value  of  the  Collateral  exceeds  the  Indebtedness  by a
     substantial amount. Employment by Lender shall not disqualify a person from
     serving as a receiver.

     Collect  Revenues,  Apply  Accounts.  Lender,  either  itself or  through a
     receiver,  may collect the payments,  rents,  income, and revenues from the
     Collateral.  Lender may at any time in  Lender's  discretion  transfer  any
     Collateral  into Lender's own name or that of Lender's  nominee and receive
     the payments,  rents,  income,  and revenues therefrom and hold the same as
     security for the Indebtedness or apply it to payment of the Indebtedness in
     such order of preference as Lender may determine. Insofar as the Collateral
     consists of accounts, general intangibles, insurance policies, instruments,
     chattel paper,  choses in action, or similar  property,  Lender may demand,
     collect,  receipt for, settle,  compromise,  adjust, sue for, foreclose, or
     realize  on  the  Collateral  as  Lender  may  determine,  whether  or  not
     Indebtedness or Collateral is then due. For these purposes.  Lender may, on
     behalf of and in the name of  Grantor,  receive,  open and  dispose of mail
     addressed to Grantor;  change any address to which mail and payments are to
     be sent;  and endorse notes,  checks,  drafts,  money orders,  documents of
     title, instruments and items pertaining to payment, shipment, or storage of
     any Collateral. To facilitate collection, Lender may notify account debtors
     and obligors on any Collateral to make payments directly to Lender.

     Obtain Deficiency.  If Lender chooses to sell any or all of the Collateral,
     Lender may obtain a judgment  against Grantor for any deficiency  remaining
     on the Indebtedness due to Lender after application of all amounts received
     from the exercise of the rights provided in this  Agreement.  Grantor shall
     be  liable  for a  deficiency  even if the  transaction  described  in this
     subsection is a sale of accounts or chattel paper.

     Other Rights and Remedies. Lender shall have all the rights and remedies of
     a secured creditor under the provisions of the Uniform  Commercial Code, as
     may be amended from time to time.  In  addition,  Lender shall have and may
     exercise any or all other rights and remedies it may have available at law,
     in equity, or otherwise.

     Election of Remedies. Except as may be prohibited by applicable law, all of
     Lender's  rights and remedies,  whether  evidenced by this  Agreement,  the
     Related Documents,  or by any other writing, shall be cumulative and may be
     exercised  singularly  or  concurrently.  Election  by Lender to pursue any
     remedy shall not exclude  pursuit of any other  remedy,  and an election to
     make  expenditures  or to take action to perform an  obligation  of Grantor
     under this Agreement,  after Grantor's failure to perform, shall not affect
     Lender's right to declare a default and exercise its remedies.

MISCELLANEOUS  PROVISIONS.  The following miscellaneous provisions are a part of
this Agreement:

    Amendments. This Agreement, together with any Related Documents, constitutes
    the entire  understanding and agreement of the parties as to the matters set
    forth in this  Agreement.  No alteration  of or amendment to this  Agreement
    shall be  effective  unless  given in  writing  and  signed  by the party or
    parties sought to be charged or bound by the alteration or amendment.

    Attorneys' Fees; Expenses. Grantor agrees to pay upon demand all of Lender's
    costs and expenses,  including  Lender's  attorneys' fees and Lender's legal
    expenses,  incurred in connection  with the  enforcement of this  Agreement.
    Lender may hire or pay someone  else to help  enforce  this  Agreement,  and
    Grantor  shall pay the costs and  expenses  of such  enforcement.  Costs and
    expenses include Lender's  attorneys' fees and legal expenses whether or not
    there is a  lawsuit,  including  attorneys'  fees  and  legal  expenses  for
    bankruptcy


<PAGE>



                          COMMERCIAL SECURITY AGREEMENT

Loan No: 4971309716                   (Continued)                         Page 6
--------------------------------------------------------------------------------


     proceedings  (including  efforts to modify or vacate any automatic  stay or
     injunction),   appeals,  and  any  anticipated   post-judgment   collection
     services. However, Grantor will only pay attorneys' fees of an attorney not
     Lender's  salaried  employee to whom the matter Is referred after Grantor's
     default. Grantor also shaft pay all court costs and such additional fees as
     may be directed by the court.

     Caption  Headings.  Caption  headings in this Agreement are for convenience
     purposes only and are not to be used to interpret or define the  provisions
     of this Agreement.

     Governing Law. This  Agreement will be governed by,  construed and enforced
     In accordance  with federal law and the laws of the State of Arizona.  This
     Agreement has been accepted by Lender In the State of Arizona.

     No Waiver by Lender.  Lender  shall not be deemed to have waived any rights
     under this  Agreement  unless such waiver is given in writing and signed by
     Lender. No delay or omission on the part of Lender in exercising. any right
     shall  operate  as a waiver of such right or any other  right.  A waiver by
     Lender of a provision of this Agreement shall not prejudice or constitute a
     waiver of Lender's right  otherwise to demand strict  compliance  with that
     provision  or any other  provision  of this  Agreement.  No prior waiver by
     Lender,  nor any  course of  dealing  between  Lender  and  Grantor,  shall
     constitute  a  waiver  of any of  Lender's  rights  or of any of  Grantor's
     obligations as to any future  transactions.  Whenever the consent of Lender
     is required under this Agreement, the granting of such consent by Lender in
     any  instance  shall  not  constitute   continuing  consent  to  subsequent
     instances  where such consent is required and in all cases such consent may
     be granted or withheld in the sole discretion of Lender

     Notices.  Any notice  required  to be given under this  Agreement  shall be
     given in writing,  and shall be effective  when  actually  delivered,  when
     actually received by telefacsimile (unless otherwise required by law), when
     deposited with a nationally  recognized  overnight courier,  or, if mailed,
     when  deposited  in the United  States mail,  as first class,  certified or
     registered mall postage  prepaid,  directed to the addresses shown near the
     beginning of this  Agreement.  Any party may change its address for notices
     under this Agreement by giving formal written notice to the other, parties,
     specifying that the purpose of the notice is to change the party's address.
     For notice purposes, Grantor agrees to keep Lender informed at all times of
     Grantor's current address. Unless otherwise provided or required by law, if
     there is more than one  Grantor,  any notice given by Lender to any Grantor
     is deemed to be notice given to all Grantors.

     Power of Attorney.  Grantor hereby appoints Lender as Grantor's irrevocable
     attorney-in-fact  for the purpose of executing any  documents  necessary to
     perfect,  amend,  or to  continue  the  security  interest  granted in this
     Agreement or to demand  termination  of filings of other  secured  parties.
     Lender may at any time,  and without  further  authorization  from Grantor,
     file  a  carbon,  photographic  or  other  reproduction  of  any  financing
     statement or of this  Agreement for use as a financing  statement.  Grantor
     will  reimburse  Lender  for  all  expenses  for  the  perfection  and  the
     continuation  of  the  perfection  of  Lender's  security  interest  In the
     Collateral.

     Severability.  If a court of competent  jurisdiction finds any provision of
     this  Agreement  to  be  illegal.  Invalid,  or  unenforceable  as  to  any
     circumstance,  that finding shall not make the offending provision illegal,
     invalid,  or unenforceable as to any other circumstance.  If feasible,  the
     offending  provision shall be considered modified so that it becomes legal,
     valid and enforceable. If the offending provision cannot be so modified, it
     shall be considered deleted from this Agreement.  Unless otherwise required
     by law, the illegality, invalidity, or unenforceability of any provision of
     this Agreement shall not affect the legality, validity or enforceability of
     any other provision of this Agreement.

     Successors and Assigns. Subject to any limitations stated in this Agreement
     on transfer of Grantor's interest, this Agreement shall be binding upon and
     inure to the benefit of the  parties,  their  successors  and  assigns.  If
     ownership of the Collateral  becomes vested in a person other then Grantor,
     Lender,  without notice to Grantor, may deal with Grantor's successors with
     reference to this Agreement and the  indebtedness  by way of forbearance or
     extension  without releasing Grantor from the obligations of this Agreement
     or liability under the Indebtedness.

     Survival  of   Representations   and   Warranties.   All   representations,
     warranties,  and agreements made by Grantor in this Agreement shall survive
     the  execution  and  delivery of this  Agreement,  shall be  continuing  in
     nature,  and shall  remain  In full  force and  effect  until  such time as
     Grantor's Indebtedness shall be paid in full.

     Time Is of the Essence.  Time to of the essence in the  performance of this
     Agreement.

DEFINITIONS.  The following capitalized words and terms shall have the following
meanings  when  used  in  this  Agreement.  Unless  specifically  stated  to the
contrary, all references to dollar amounts shall mean amounts in lawful money of
the  United  States of  America.  Words and terms  used in the  singular"  shall
include the plural,  and the plural shall include the  singular,  as the context
may require.  Words and terms not otherwise defined In this Agreement shall have
the meanings attributed to such terms in the Uniform Commercial Code:

     Account.  The word "Account11  means a trade account,  account  receivable,
     other  receivable,  or other  right to payment  for goods sold or  services
     rendered  owing to  Grantor  (or to a third  party  grantor  acceptable  to
     Lender).

     Agreement.  The word "Agreement" means this Commercial  Security Agreement,
     as this Commercial  Security Agreement may be amended or modified from time
     to  time,  together  with  all  exhibits  and  schedules  attached  to this
     Commercial Security Agreement from time to time.

     Borrower. The word "Borrower" means US GLOBAL AEROSPACE,  INC. F/K/A CARING
     PRODUCTS INTERNATIONAL,  INC. ALSO KNOWN AS U.S. GLOBAL NANOSPACE, INC. and
     Includes all co-signers and co-makers signing the Note.

     Collateral.  The word "Collateral"  means alt of Grantor's right, title and
     interest  in and to all  the  Collateral  as  described  in the  Collateral
     Description section of this Agreement.

     Default.  The word "Default"  means the Default sat forth in this Agreement
     fn the section titled "Default".

     Environmental Laws. The words  "Environmental Laws" mean any and all state,
     federal and local  statutes,  regulation*  and  ordinances  relating to the
     protection of human earth or the environment. Including without


<PAGE>




                          COMMERCIAL SECURITY AGREEMENT

Loan No: 4971309716                  (Continued)                          Page 7
--------------------------------------------------------------------------------


     limitation the  Comprehensive  Environmental  Response,  Compensation,  and
     Liability  Act of  1980,  as  amended,  42  U.S.C.  Section  9601,  et seq.
     ("CERCLA"),  the Superfund Amendments and Reauthorization Act of 1986, Pub.
     L. No. 99-499  ("SARA"),  the Hazardous  Materials  Transportation  Act, 49
     U.S.C.  Section 1801, et seq., the Resource  Conservation and Recovery Act,
     42 U.S.C. Section 6901, et seq., or other applicable state or federal laws,
     rules, or regulations adopted pursuant thereto.

     Event of Default.  The words  "Event of Default"  mean any of the events of
     default  set  forth  in  this  Agreement  in the  default  section  of this
     Agreement.

     Grantor.  The word "Grantor" means US GLOBAL  AEROSPACE,  INC. F/K/A CARING
     PRODUCTS INTERNATIONAL, INC. ALSO KNOWN AS U.S. GLOBAL NANOSPACE, INC..

     Guarantor.   The  word  "Guarantor"   means  any  guarantor,   surety,   or
     accommodation party of any or all of the Indebtedness.

     Guaranty.  The word "Guaranty" means the guaranty from Guarantor to Lender,
     including without limitation a guaranty of all or part of the Note.

     Hazardous Substances. The words "Hazardous Substances" mean materials that,
     because  of  their  quantity,   concentration  or  physical,   chemical  or
     infectious characteristics, may cause or pose a present or potential hazard
     to human health or the environment when improperly used,  treated,  stored,
     disposed of, generated, manufactured, transported or otherwise handled. The
     words  "Hazardous  Substances"  are used in their very  broadest  sense and
     include  without  limitation  any and all  hazardous  or toxic  substances,
     materials  or waste as defined by or listed under the  Environmental  Laws.
     The  term  "Hazardous   Substances"  also  includes,   without  limitation,
     petroleum and petroleum by-products or any fraction thereof and asbestos.

     Indebtedness.  The word "Indebtedness" means the Indebtedness  evidenced by
     the  Note or  Related  Documents,  including  all  principal  and  interest
     together  with all other  Indebtedness  and costs  and  expenses  for which
     Grantor is  responsible  under this  Agreement  or under any of the Related
     Documents.  Specifically,  without  limitation,  Indebtedness  includes all
     amounts  that  may be  indirectly  secured  by the  Cross-Collateralization
     provision of this Agreement.

     Lender.  The word "Lender" means WESTERN  SECURITY BANK, its successors and
     assigns.

     Note. The word "Note" means the Note executed by US GLOBAL AEROSPACE,  INC.
     F/K/A  CARING  PRODUCTS  INTERNATIONAL,  INC.  ALSO  KNOWN  AS U.S.  GLOBAL
     NANOSPACE,  INC. in the principal  amount of  $1,650,000.00  dated June 30,
     2003,  together  with all renewals of,  extensions  of,  modifications  of,
     refinancings  of,  consolidations  of,  and  substitutions  for the note or
     credit agreement.

     Property.  The word  "Property"  means all of  Grantor's  right,  title and
     interest  in  and to all  the  Property  as  described  in the  "Collateral
     Description" section of this Agreement.

     Related Documents. The words "Related Documents" mean all promissory notes,
     credit agreements, loan agreements,  environmental agreements,  guaranties,
     security agreements,  mortgages, deeds of trust, security deeds, collateral
     mortgages, and all other instruments, agreements and documents, whether now
     or hereafter existing, executed in connection with the Indebtedness.

GRANTOR HAS READ AND UNDERSTOOD ALL THE PROVISIONS OF THIS  COMMERCIAL  SECURITY
AGREEMENT AND AGREES TO ITS TERMS. THIS AGREEMENT IS DATED JUNE 30, 2003.

GRANTOR:



<PAGE>



US GLOBAL AEROSPACE/, INC. F/K/A CARING PRODUCTS INTERNATIONAL,  INC. ALSO KNOWN
AS U.S. GLOBAL NANOSPACE, INC.


BY: /s/JOHN D. ROBINSON


JOHN D. ROBINSON, PRESIDENT OF US
GLOBAL AEROSPACE, INC. F/K/A CARING PRODUCTS INTERNATIONAL, INC.
ALSO KNOWN AS U.S. GLOBAL NANOSPACE, INC.